EXHIBIT 10.1
MASTER AGREEMENT
Dated as of June 11, 1999
among
DOLLAR GENERAL CORPORATION,
as a Lessee and Guarantor,
CERTAIN SUBSIDIARIES OF DOLLAR
GENERAL CORPORATION, as Lessees,
ATLANTIC FINANCIAL GROUP, LTD., as Lessor,
THREE PILLARS FUNDING CORPORATION, as Lender,
CERTAIN FINANCIAL INSTITUTIONS PARTIES HERETO,
as Liquidity Banks,
SUNTRUST BANK, NASHVILLE, N.A., as Agent and as Liquidity Agent
FIRST UNION NATIONAL BANK, as Syndication Agent,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS BANK, as Documentation Agent,
THE FIRST NATIONAL BANK OF CHICAGO and WACHOVIA BANK, N.A., as Co-Agents
and
SUNTRUST EQUITABLE SECURITIES CORPORATION, as Administrator
TABLE OF CONTENTS
Page (1)
SECTION 1 DEFINITIONS; INTERPRETATION ...................................... 2
SECTION 2 ACQUISITION, CONSTRUCTION AND LEASE; FUNDINGS; NATURE OF
TRANSACTION
2
SECTION 2.1 Agreement to Acquire, Construct, Fund and Lease 2
(a) Land .............................................. 2
(b) Building .......................................... 2
SECTION 2.2 Fundings of Purchase Price, Development
Costs and Construction Costs .................. 3
(a) Initial Funding and Payment of Purchase Price
for Land and Development Costs on Closing Date .... 3
(b) Subsequent Fundings and Payments of Construction
Costs during Construction Term .................... 3
(c) Aggregate Limits on Funded Amounts ................ 3
(d) Notice, Time and Place of Fundings ................ 4
(e) Lessees' Deemed Representation for Each Funding ... 4
(f) Not Joint Obligations ............................. 5
(g) Non-Pro Rata Fundings ............................. 5
(h) Pre-Funded Amount.................................. 5
SECTION 2.3 Funded Amounts and Interest and Yield
Thereon; Facility Fee ......................... 6
SECTION 2.4 Lessee Owner for Tax Purposes ................. 6
SECTION 2.5 Amounts Due Under Lease ....................... 6
SECTION 3 CONDITIONS PRECEDENT; DOCUMENTS .................................. 7
SECTION 3.1 Conditions to the Obligations of the
Funding Parties on each Closing Date........... 7
(a) Documents ......................................... 7
(i) Deed and Purchase Agreement................. 7
(ii) Lease Supplement............................ 8
(iii) Mortgage and Assignment of Lease and Rents.. 8
(iv) Security Agreement and Assignment........... 8
(v) Survey...................................... 8
(vi) Title and Title Insurance .................. 9
(vii) Appraisal................................... 9
(viii) Environmental Audit and related
Reliance Letter............................. 9
(ix) Evidence of Insurance....................... 10
(x) UCC Financing Statement; Recording Fees;
Transfer Taxes.............................. 10
(xi) Opinions.................................... 10
(xii) Officer's Certificate....................... 10
(xiii) Good Standing Certificates.................. 11
(1) Page numbers are for original printed document and are not conformed for
filing via Xxxxx
(b) Litigation......................................... 11
(c) Legality........................................... 11
(d) No Events.......................................... 11
(e) Representations.................................... 11
(f) Cutoff Date........................................ 11
(g) Transaction Expenses .............................. 12
SECTION 3.2 Additional Conditions for the Initial
Closing Date................................... 12
(i) Guaranty.................................... 12
(ii) Loan Agreement.............................. 12
(iii) Master Agreement............................ 12
(iv) Construction Agency Agreement............... 12
(v) Lease....................................... 12
(vi) Lessee's Resolutions and Incumbency
Certificate, etc............................ 12
(vii) Opinions of Counsel......................... 13
(viii) Good Standing Certificate................... 13
(ix) Lessor's Consents and Incumbency
Certificate, etc............................ 13
SECTION 3.3 Conditions to the Obligations of Lessee ...... 13
(a) General Conditions ............................... 13
(b) Legality ......................................... 13
(c) Purchase Agreement; Ground Lease ................. 14
SECTION 3.4 Conditions to the Obligations of the
Funding Parties on each Funding Date ......... 14
(a) Funding Request .................................. 14
(b) Condition Fulfilled .............................. 14
(c) Representations .................................. 14
(d) No Bonded Stop Notice or Filed Mechanics Lien .... 14
(e) Lease Supplement ................................. 14
SECTION 3.5 Completion Date Conditions ................... 15
(a) Title Policy Endorsements; Architect's Certificate 15
(b) Construction Completion .......................... 15
(c) Construction Agent Certification ................. 15
SECTION 3.6 Addition of Lessees .......................... 16
SECTION 4 REPRESENTATIONS ................................................. 17
SECTION 4.1 Representations of Lessees ................... 17
(a) Organization; Corporate Powers ................... 17
(b) Authority ........................................ 17
(c) Binding Obligations .............................. 17
(d) No Conflict ...................................... 18
(e) Governmental Consents ............................ 18
(f) Governmental Regulation .......................... 18
(g) Requirements of Law .............................. 18
(h) Rights in Respect of the Leased Property ......... 18
(i) Hazardous Materials - Leased Properties .......... 18
(j) Leased Property .................................. 20
(k) True and Complete Disclosure ..................... 20
(l) Financial Statements ............................. 20
(m) No Material Litigation ........................... 21
(n) Margin Regulations ............................... 21
(o) Subsidiaries ..................................... 21
(p) Compliance With Environmental Laws ............... 21
(q) Insurance ........................................ 22
(r) No Default ................................... 22
(s) No Burdensome Restrictions ....................... 22
(t) Taxes ........................................ 22
(u) Year 2000 Issues ............................. 23
(v) ERISA ............................................ 23
(w) Patents, Trademarks, Licenses, Etc ................ 24
(x) Ownership of Property; Liens ..................... 24
(y) Indebtedness ..................................... 25
(z) Financial Condition .............................. 25
(aa) Labor Matters .................................... 25
(bb) Payment or Dividend Restrictions ................. 25
(cc) Financial Projections ............................ 26
(dd) Notice of Violations ............................. 26
(ee) Filings .......................................... 26
SECTION 4.2 Representations of the Lessor ................ 26
(a) Securities Act ................................... 26
(b) Due Organization, etc ............................ 26
(c) Due Authorization; Enforceability, etc ........... 26
(d) No Conflict ...................................... 27
(e) Litigation ....................................... 27
(f) Lessor Liens ..................................... 27
(g) Employee Benefit Plans ........................... 27
(h) General Partner .................................. 27
(i) Financial Information ............................ 27
(j) No Offering ...................................... 28
SECTION 4.3 Representations of the Lender ................ 28
(a) Securities Act ................................... 28
(b) Employee Benefit Plans ........................... 28
SECTION 5 COVENANTS OF THE LESSEES AND THE LESSOR ......................... 28
SECTION 5.1 Affirmative Covenants ........................ 28
(a) Corporate Existence, Etc ......................... 28
(b) Compliance with Laws, Etc ........................ 28
(c) Payment of Taxes and Claims, Etc ................. 28
(d) Keeping of Books ................................. 29
(e) Visitation, Inspection, Etc ...................... 29
(f) Insurance; Maintenance of Properties ............. 29
(g) Financial Reports ................................ 30
(h) Notices Under Certain Other Indebtedness ......... 32
(i) Notice of Litigation ............................. 32
(j) Subsidiary Guaranties ............................ 32
(k) Existing Business ................................ 33
(l) ERISA information and Compliance ................. 33
(m) Financial Requirements ........................... 33
(n) Liens ............................................ 33
(o) Merger and Sale of Assets ........................ 35
(p) Transactions with Affiliates ..................... 35
(q) Nature of Business ............................... 35
(r) Regulations T, U and X ........................... 35
(s) ERISA Compliance ................................. 36
(t) Investments, Loans, and Advances ................. 36
(u) ................................................... 37
(v) Guaranties ....................................... 37
(w) Acquisitions ..................................... 37
(x) ................................................... 37
SECTION 5.2 Further Assurances ........................... 38
SECTION 5.3 Additional Required Appraisals ............... 38
SECTION 5.4 Lessor's Covenants ........................... 38
SECTION 6 TRANSFERS BY LESSOR AND LENDER .................................. 39
SECTION 6.1 Lessor Transfers ............................. 39
SECTION 6.2 Lender Transfers ............................. 39
SECTION 7 INDEMNIFICATION ................................................. 40
SECTION 7.1 General Indemnification ...................... 40
SECTION 7.2 Environmental Indemnity ...................... 42
SECTION 7.3 Proceedings in Respect of Claims ............. 43
SECTION 7.4 General Tax Indemnity ........................ 45
(a) Tax Indemnity .................................... 45
(b) Exclusions from General Tax Indemnity ............ 45
(c) Contests ......................................... 47
(d) Reimbursement for Tax Savings .................... 49
(e) Payments ......................................... 49
(f) Reports .......................................... 49
(g) Verification ..................................... 50
SECTION 7.5 Increased Costs, etc ......................... 50
(a) Taxes ............................................ 50
(b) Interest Rate Not Ascertainable, etc ............. 53
(c) Illegality ....................................... 53
(d) Increased Costs .................................. 54
(e) Lending Offices .................................. 55
(f) Funding Losses ................................... 56
(g) Assumptions Concerning Funding of LIBOR Advances . 56
(h) Capital Adequacy ................................. 56
(i) Limitation on Certain Payment Obligations ........ 57
SECTION 7.6 End of Term Indemnity ........................ 58
SECTION 8 MISCELLANEOUS ................................................... 59
SECTION 8.1 Survival of Agreements ...................... 59
SECTION 8.2 Notices ...................................... 59
SECTION 8.3 Counterparts ................................. 59
SECTION 8.4 Amendments ................................... 59
SECTION 8.5 Headings, etc ................................ 61
SECTION 8.6 Parties in Interest .......................... 61
SECTION 8.7 GOVERNING LAW ............................... 61
SECTION 8.8 Expenses ..................................... 61
SECTION 8.9 Severability ................................. 61
SECTION 8.10 Liabilities of the Funding Parties ........... 61
SECTION 8.11 Submission to Jurisdiction; Waivers .......... 62
SECTION 8.12 Liabilities of the Agent ..................... 62
APPENDIX A Definitions and Interpretation
SCHEDULES
SCHEDULE 2.2 Commitments
SCHEDULE 4.1(m) Litigation
SCHEDULE 4.1(o) Subsidiaries
SCHEDULE 4.1(p) Environmental Matters
SCHEDULE 4.1(s) Burdensome Restrictions
SCHEDULE 4.1(v) ERISA Matters
SCHEDULE 4.1(w) Patents, Trademarks and Licenses
SCHEDULE 4.1(x) Ownership of Property
SCHEDULE 4.1(y) Indebtedness
SCHEDULE 4.1(aa) Labor Matters
SCHEDULE 4.1(bb) Dividend Restrictions
SCHEDULE 8.2 Notice Information
EXHIBITS
EXHIBIT A Form of Funding Request
EXHIBIT B Form of Assignment of Lease and Rents
EXHIBIT C Form of Security Agreement and Assignment
EXHIBIT D Form of Mortgage
EXHIBIT E Form of Joinder Agreement
EXHIBIT F Form of Certification of Construction Completion
EXHIBIT G Forms of Opinions of Counsel
EXHIBIT H Form of Compliance Certificate
EXHIBIT I Form of Subsidiary Guaranty
MASTER AGREEMENT
THIS MASTER AGREEMENT, dated as of June 11, 1999 (as it may be amended or
modified from time to time in accordance with the provisions hereof, this
"Master Agreement"), is among DOLLAR GENERAL CORPORATION, a Tennessee
corporation ("Dollar"), certain Subsidiaries of Dollar that may hereafter become
parties hereto pursuant to Section 3.6 (together with Dollar in its capacity as
a lessee, individually a "Lessee" and collectively, the "Lessees"), ATLANTIC
FINANCIAL GROUP, LTD., a Texas limited partnership (the "Lessor"), THREE PILLARS
FUNDING CORPORATION, a Delaware corporation ("Lender"), certain financial
institutions parties hereto as liquidity providers (together with any other
financial institution that becomes a party to the Liquidity Agreement as a
liquidity provider, collectively referred to as "Liquidity Banks" and
individually as a "Liquidity Bank"), SUNTRUST BANK, NASHVILLE, N.A., a national
banking association, as agent for the Funding Parties (in such capacity, the
"Agent") and as agent for the Liquidity Banks (in such capacity, the "Liquidity
Agent"), FIRST UNION NATIONAL BANK, as Syndication Agent, BANK OF AMERICA
NATIONAL TRUST AND SAVINGS BANK, as Documentation Agent, THE FIRST NATIONAL BANK
OF CHICAGO and WACHOVIA BANK, N.A., as Co-Agents, and SUNTRUST EQUITABLE
SECURITIES CORPORATION, a Tennessee corporation, as administrator for the Lender
(in such capacity, the "Administrator").
PRELIMINARY STATEMENT
In accordance with the terms and provisions of this Master Agreement,
the Lease, the Loan Agreement and the other Operative Documents, (i) the Lessor
contemplates acquiring Land identified by Dollar from time to time, and leasing
such Land to a Lessee, (ii) Dollar, as Construction Agent for the Lessor, wishes
to construct Buildings on such Land for the Lessor and, when completed, to lease
such Buildings, or to cause such Buildings to be leased, from the Lessor as part
of the Leased Properties under the Lease, (iii) Dollar, as agent, wishes to
obtain, and the Lessor is willing to provide, funding for the acquisition of the
Land and the construction of Buildings, (iv) the Lessor wishes to obtain, and
Lender is willing to provide, from time to time, financing of a portion of the
funding of the acquisition of the Land and the construction of the Buildings,
(v) Dollar is willing to provide its Guaranty Agreement to the Lender and the
Lessor and (vi) Lender will obtain the funds for the Loans either by the
issuance of Commercial Paper or draws under the Liquidity Agreement.
In consideration of the mutual agreements contained in this Master
Agreement and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1 DEFINITIONS; INTERPRETATION
Unless the context shall otherwise require, capitalized terms used and
not defined herein shall have the meanings assigned thereto in Appendix A hereto
for all purposes hereof; and the rules of interpretation set forth in Appendix A
hereto shall apply to this Master Agreement.
SECTION 2 ACQUISITION, CONSTRUCTION AND LEASE; FUNDINGS; NATURE OF TRANSACTION
SECTION 2.1 Agreement to Acquire, Construct, Fund and Lease.
(a) Land. Subject to the terms and conditions of this Master Agreement,
with respect to each parcel of Land identified by Dollar that is
not an IDB Property acquired by an Authority pursuant to the
following sentence, on the related Closing Date (i) the Lessor
agrees to acquire such interest in the related Land from the
applicable Seller as is transferred, sold, assigned and conveyed to
the Lessor pursuant to the applicable Purchase Agreement or other
transfer documentation or to lease such interest in the related
Land from the applicable Ground Lessor as is leased to the Lessor
pursuant to the applicable Ground Lease, (ii) the Lessor hereby
agrees to lease, or sublease, as the case may be, such Land to a
Lessee pursuant to the Lease, and (iii) the related Lessee hereby
agrees to lease, or sublease, as the case may be, such Land from
the Lessor pursuant to the Lease. With respect to each IDB
Property, (i) the applicable Authority may acquire such interest in
the related Land from the applicable Seller as is transferred,
sold, assigned and conveyed to the Authority pursuant to the
applicable Purchase Agreement, (ii) the applicable Authority will
lease such Land to the Lessor pursuant to the related IDB Lease,
and (iii) the related Lessee hereby agrees to sublease such Land
from the Lessor pursuant to the Lease (it being understood that any
reference in the Operative Documents to the lease by a Lessee of an
IDB Property acquired by an Authority shall be deemed to refer to
the sublease thereof pursuant to the Lease).
(b) Building. With respect to each parcel of Land, subject to the terms
and conditions of this Master Agreement, from and after the Closing
Date relating to such Land (i) the Construction Agent agrees,
pursuant to the terms of the Construction Agency Agreement, to
construct and install the Building on such Land for the Lessor
prior to the Scheduled Construction Termination Date, (ii) the
Lenders and the Lessor agree to fund the costs of such construction
and installation (and interest and yield thereon), (iii) the Lessor
shall lease, or sublease, as the case may be, such Building as part
of such Leased Property to the related Lessee pursuant to the
Lease, and (iv) the related
Lessee shall lease, or sublease, as the case may be, such Building
from the Lessor pursuant to the Lease.
SECTION 2.2 Fundings of Purchase Price, Development Costs and
Construction Costs.
(a) Initial Funding and Payment of Purchase Price for Land and
Development Costs on Closing Date. Subject to the terms and
conditions of this Master Agreement, on the Closing Date for any
Land, the Lender shall make available to the Lessor its initial
Loan with respect to such Land in an amount equal to the product of
the Lender's Commitment Percentage (or 100% if the Lessor's
Commitment has been fully funded in accordance with Section 2.2(g))
times the purchase price for the Land, if applicable, and the
development, transaction and closing costs incurred by the
Construction Agent, as agent, through such Closing Date, which
funds the Lessor shall use, together with the Lessor's own funds in
an amount equal to the product of the Lessor's Commitment
Percentage times the purchase price, if applicable, for the related
Land and the development, transaction and closing costs incurred by
the Construction Agent, as agent, through such Closing Date (unless
the Lessor's Commitment has already been fully funded in accordance
with Section 2.2(g)), to purchase the Land from the applicable
Seller pursuant to the applicable Purchase Agreement or lease the
Land from the applicable Ground Lessor pursuant to the applicable
Ground Lease and to pay to the Construction Agent the amount of
such development, transaction and closing costs, and the Lessor
shall lease, or sublease, as the case may be, such Land to the
related Lessee pursuant to the Lease.
(b) Subsequent Fundings and Payments of Construction Costs during
Construction Term. Subject to the terms and conditions of this
Master Agreement, on each Funding Date following the Closing Date
for each parcel of Land until the related Construction Term
Expiration Date, (i) the Lender shall make available to the Lessor
a Loan in an amount equal to the product of the Lender's Commitment
Percentage (or 100% if the Lessor's Commitment has been fully
funded in accordance with Section 2.2(g)) times the amount of
Funding requested by the Construction Agent for such Funding Date,
which funds the Lessor hereby directs the Lender to pay over to the
Construction Agent as set forth in paragraph (d), and (ii) (unless
the Lessor's Commitment has already been fully funded in accordance
with Section 2.2(g)) the Lessor shall pay over to the Construction
Agent its own funds (which shall constitute a part of and an
increase in the Lessor's Invested Amount with respect to such
Leased Property) in an amount equal to the product of the Lessor's
Commitment Percentage times the amount of Funding requested by the
Construction Agent for such Funding Date.
(c) Aggregate Limits on Funded Amounts. The aggregate amount that the
Funding Parties shall be committed to provide as Funded Amounts
under this Master Agreement and the Loan Agreement shall not exceed
(x) with respect to each Leased Property the costs of purchase and
construction of such Leased Property and the related closing and
financing costs, or (y) $200,000,000 in the aggregate for all
Leased
Properties minus the Reduction Amount for each non-renewing
Liquidity Bank; provided, however, that in the event that any
Lessee exercises a Partial Purchase Option, the amount set forth in
this clause (y) shall be reinstated to the extent of the Funded
Amounts paid by such Lessee in connection with such Partial
Purchase Option. The aggregate amount that any Funding Party shall
be committed to fund under this Master Agreement and the Loan
Agreement shall not exceed the lesser of (i) such Funding Party's
Commitment and (ii) such Funding Party's Commitment Percentage of
the aggregate Fundings requested under this Master Agreement.
(d) Notice, Time and Place of Fundings. With respect to each Funding,
the Construction Agent shall give the Lessor, the Agent and the
Administrator an irrevocable prior written notice not later than
11:00 a.m., Nashville, Tennessee time, three Business Days prior to
the proposed Closing Date or other Funding Date, as the case may
be, pursuant, in each case, to a Funding Request in the form of
Exhibit A (a "Funding Request"), specifying the Closing Date or
subsequent Funding Date, as the case may be, and the amount of
Funding requested. All documents and instruments required to be
delivered on such Closing Date pursuant to this Master Agreement
shall be delivered at the offices of Xxxxx, Xxxxx & Xxxxx, 000
Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, or at such other
location as may be determined by the Lessor, the Construction
Agent, the Agent and the Administrator. Each Funding shall occur on
a Business Day and shall be in an amount equal to $3,000,000 or an
integral multiple of $100,000 in excess thereof. There shall be no
more than four Fundings in any calendar month. All remittances made
by the Lender and the Lessor for any Funding shall be made in
immediately available funds by wire transfer to or, as is directed
by, the Construction Agent, with receipt by the Construction Agent
not later than 12:00 noon, Nashville, Tennessee time, on the
applicable Funding Date, upon satisfaction or waiver of the
conditions precedent to such Funding set forth in Section 3; such
funds shall (1) unless no purchase price is payable to the
applicable Seller for the related Land, in the case of the initial
Funding on a Closing Date, be used to pay the purchase price to the
applicable Seller or the rent to the applicable Ground Lessor, as
the case may be, for the related Land and pay the Construction
Agent development, transaction and closing costs related to such
Land, and (2) in the case of each subsequent Funding (or first
Funding in the case of a Leased Property for which no purchase
price was payable for the related Land) be paid to the Construction
Agent, for the payment or reimbursement of Construction costs that
have been incurred on or prior to such Funding Date.
(e) Lessees' Deemed Representation for Each Funding. Each Funding
Request by the Construction Agent shall be deemed a reaffirmation
of each Lessee's indemnity obligations in favor of the Indemnitees
under the Operative Documents and a representation by Dollar to the
Lessor, the Agent, the Lender and the Liquidity Banks that on the
proposed Closing Date or Funding Date, as the case may be, (i) the
amount of Funding requested represents amounts owing in respect of
the purchase price of the related Land and development, transaction
and closing costs in respect of the Leased Property (in the case of
the initial Funding on a Closing Date, unless no purchase price is
payable to the applicable Seller for the related Land) or amounts
that are due from
the Construction Agent to third parties in respect of the
Construction, or amounts paid by the Construction Agent to third
parties in respect of the Construction for which the Construction
Agent has not previously been reimbursed by a Funding (in the case
of any Funding), (ii) no Event of Default or Potential Event of
Default exists, and (iii) the representations of the Lessees set
forth in Section 4.1 are true and correct in all Material respects
as though made on and as of such Funding Date, except to the extent
such representations or warranties relate solely to an earlier
date, in which case such representations and warranties shall have
been true and correct in all Material respects on and as of such
earlier date.
(f) Not Joint Obligations. Notwithstanding anything to the contrary set
forth herein or in the other Operative Documents, the Lender's and
the Lessor's commitments shall be several, and not joint. In no
event shall any Funding Party be obligated to fund an amount in
excess of such Funding Party's Commitment Percentage of any
Funding, or to fund amounts in the aggregate in excess of such
Funding Party's Commitment.
(g) Non-Pro Rata Fundings. Notwithstanding anything to the contrary set
forth in this Master Agreement, at the Agent's option, Fundings may
be made by drawing on the Lessor's Commitment until such Commitment
is fully funded before drawing on the Lender's Commitment. In such
event, when the Lessor's Commitment is fully funded, the Lender
will fund 100% of the amount of the Fundings thereafter. In no
event shall any Funding Party have any obligation to fund any
amount hereunder in excess of the amount of such Funding Party's
Commitment.
(h) Pre-Funded Amount. The Construction Agent may request, by delivery
of an irrevocable prior written notice to the Lessor, the Agent and
the Administrator not later than 11:00 a.m. Nashville, Tennessee
time, three Business Days prior to the proposed funding date, that
the Funding Parties prefund amounts to the Construction Agent for
anticipated acquisitions (the "Pre-Funded Amount"), provided that
at no time shall the Pre-Funded Amount exceed $5,000,000. The
Pre-Funded Amount shall accrue interest or Yield, as the case may
be, commencing on the date such amount is funded to the
Construction Agent. The Funding Parties shall not be obligated to
make such Funding if (i) any Event of Default or Potential Event of
Default has occurred and in continuing or (ii) the representations
of the Lessees set forth in Section 4.1 are not true and correct in
all Material respects as of the date of deposit, except to the
extent such representations and warranties related solely to an
earlier date, in which case such representations and warranties
shall have been true in all Material respects as of such earlier
date. The Construction Agent may disburse the Pre-Funded Amount,
which date of disbursement shall be a Closing Date or a Funding
Date, as applicable, provided that all of the conditions precedent
set forth herein with respect to such Closing Date or Funding Date,
as the case may be, have been satisfied. If any portion of the
Pre-Funded Amount has not been disbursed on the date that is 120
days from the date of the funding thereof by the Funding Parties to
the Construction Agent, such funds, together with accrued interest
and Yield thereon, shall be returned to the Funding Parties.
SECTION 2.3 Funded Amounts and Interest and Yield Thereon; Facility
Fee.
1. The Lessor's Invested Amount for any Leased Property outstanding from time to
time shall accrue yield ("Yield") at the Lessor Rate, computed using the actual
number of days elapsed and a 360 day year. If all or a portion of the principal
amount of or yield on the Lessor's Invested Amounts shall not be paid when due
(whether at the stated maturity, by acceleration or otherwise), such overdue
amount shall, without limiting the rights of the Lessor under the Lease, to the
maximum extent permitted by law, accrue yield at the Overdue Rate, from the date
of nonpayment until paid in full (both before and after judgment).
2. The Lender's Funded Amount for any Leased Property outstanding from time to
time shall accrue interest as provided in the Loan Agreement.
3. During the Construction Term, in lieu of the payment of accrued interest, on
each Payment Date, the Lender's Funded Amount in respect of a Construction Land
Interest shall automatically be increased by the amount of interest accrued and
unpaid on the related Loans pursuant to the Loan Agreement during the Rent
Period ending immediately prior to such Payment Date (except to the extent that
at any time such increase would cause the Lender's Funded Amount to exceed the
Lender's Commitment, in which event the related Lessee shall pay such excess
amount to the Lender in immediately available funds on such Payment Date).
Similarly, in lieu of the payment of accrued Yield, on each Payment Date, the
Lessor's Invested Amount in respect of such Construction Land Interest shall
automatically be increased by the amount of Yield accrued on the Lessor's
Invested Amount in respect of such Construction Land Interest during the Rent
Period ending immediately prior to such Payment Date (except to the extent that
at any time such increase would cause the Lessor's Invested Amount to exceed the
Lessor's Commitment, in which event the related Lessee shall pay such excess
amount to the Lessor in immediately available funds on such Payment Date). Such
increases in Funded Amounts shall occur without any disbursement of funds by the
Funding Parties.
4. Dollar hereby agrees to pay to the Agent, for the benefit of the Lessor and
the Liquidity Banks, a facility fee for each day from June 29, 1999 until the
Lease Termination Date equal to (i) the applicable Facility Fee Percentage per
annum times (ii) the amount of the Aggregate Commitment, whether used or unused,
times (iii) 1/360. Such facility fee shall be payable in arrears on each
Quarterly Payment Date.
SECTION 2.4 Lessee Owner for Tax Purposes.
With respect to each Leased Property, it is the intent of the Lessee
and the Funding Parties that the Lease shall constitute and be interpreted as a
true leasing transaction, except that for federal, state and local tax purposes,
and for bankruptcy, commercial and regulatory law purposes, the Lease shall be
treated as the repayment and security provisions of a loan by the Lessor to such
Lessee, and that such Lessee
shall be treated as the legal and beneficial owner entitled to any and all
benefits of ownership of such Leased Property and all payments of Basic Rent
during the Lease Term shall be treated as payments of interest and principal.
Each of the related Lessee and each Funding Party agrees to file tax returns
consistent with such intent. Nevertheless, each Lessee acknowledges and agrees
that no Funding Party or any other Person has made any representations or
warranties concerning the tax, financial, accounting or legal characteristics or
treatment of the Operative Documents and that each Lessee has obtained and
relied solely upon the advice of its own tax, accounting and legal advisors
concerning the Operative Documents and the accounting, tax, financial and legal
consequences of the transactions contemplated therein.
SECTION 2.5 Amounts Due Under Lease.
With respect to each Leased Property, anything else herein or elsewhere
to the contrary notwithstanding, it is the intention of the Lessees and the
Funding Parties that: (i) the amount and timing of Basic Rent due and payable
from time to time from the related Lessee under the Lease shall be equal to the
aggregate payments due and payable with respect to interest on, and principal
of, the Loans in respect of such Leased Property and Yield on, and principal of,
the Lessor's Invested Amounts in respect of such Leased Property on each Payment
Date; (ii) if the related Lessee elects the Purchase Option or the Partial
Purchase Option with respect to a Leased Property or becomes obligated to
purchase such Leased Property under the Lease, the Funded Amounts in respect of
such Leased Property, all interest and Yield thereon and all other obligations
of such Lessee owing to the Funding Parties in respect of the Leased Property
shall be paid in full by such Lessee, (iii) if the related Lessee properly
elects the Remarketing Option, the principal amount of, and accrued interest on,
the A Loans in respect of such Leased Property, will be paid out of the Recourse
Deficiency Amount, and such Lessee shall only be required to pay to the Lender
in respect of the principal amount of the B Loans in respect of such Leased
Property and to the Lessor in respect of the Lessor's Invested Amounts in
respect of such Leased Property, the proceeds of the sale of such Leased
Property; and (iv) upon an Event of Default resulting in an acceleration of the
related Lessee's obligation to purchase such Leased Property under the Lease,
the amounts then due and payable by such Lessee under such Lease shall include
all amounts necessary to pay in full the Loans in respect of such Leased
Property, and accrued interest thereon, the Lessor's Invested Amounts in respect
of such Leased Property and accrued Yield thereon and all other obligations of
such Lessee owing to the Funding Parties in respect of such Leased Property.
SECTION 3 CONDITIONS PRECEDENT; DOCUMENTS
SECTION 3.1 Conditions to the Obligations of the Funding Parties on
each Closing Date.
The obligations of the Lessor and the Lender to carry out their
respective obligations under Section 2 of this Master Agreement to be performed
on the Closing Date with respect to any Leased Property shall be subject to the
fulfillment to the satisfaction of, or waiver by, each such party hereto (acting
directly or through its counsel) on or prior to such Closing Date of the
following conditions precedent, provided that the obligations of any Funding
Party shall not be subject to any conditions contained in this Section 3.1 which
are required to be performed by such Funding Party:
(a) Documents. The following documents shall have been executed and
delivered by the respective parties thereto:
(i) Deed and Purchase Agreement. The related original Deed duly
executed by the applicable Seller and in recordable form, and
copies of the related Purchase Agreement, duly executed by
such Seller and the Lessor, shall each have been delivered to
the Agent by Dollar, with copies thereof to each Funding
Party, or the related Ground Lease duly executed by the Lessor
and the related Ground Lessor shall have been delivered to the
Agent, with copies thereof to each Funding Party, as
applicable (it being understood, that each Purchase Agreement
and each Ground Lease shall be satisfactory in form and
substance to the Lessor and the Agent). If such Leased
Property is an IDB Property, the IDB Documentation therefor
shall be satisfactory in form and substance to the Lessor and
the Agent.
(ii) Lease Supplement. The original of the related Lease
Supplement, duly executed by the related Lessee and the Lessor
and in recordable form, shall have been delivered to the Agent
by the related Lessee.
(iii) Mortgage and Assignment of Lease and Rents. Counterparts of
the Mortgage (substantially in the form of Exhibit D attached
hereto), duly executed by the Lessor and in recordable form,
shall have been delivered to the Agent (which Mortgage shall
secure all of the debt to the Funding Parties unless such
mortgage is subject to a tax based on the amount of
indebtedness secured thereby, in which case the amount secured
will be limited to debt in an amount equal to 125% of the
projected cost of acquisition and construction of such Leased
Property); and the Assignment of Lease and Rents
(substantially in the form of Exhibit B attached hereto) in
recordable form, duly executed by the Lessor, shall have been
delivered to the Agent by the Lessor.
(iv) Security Agreement and Assignment. If such Leased Property is
a Major Property, counterparts of the Security Agreement and
Assignment (substantially in the form of Exhibit C attached
hereto), duly executed - by the Construction Agent, with an
acknowledgment and consent thereto satisfactory to the Lessor
and the Agent duly executed by the related General Contractor
and the related Architect, as applicable, and complete copies
of the related Construction Contract and the related
Architect's Agreement certified by the Construction Agent,
shall have been delivered to the Lessor and the Agent (it
being understood and agreed that if no related Construction
Contract or Architect's Agreement exists on such Closing Date,
such delivery shall not be a condition precedent to the
Funding on such Closing Date, and in lieu thereof the
Construction Agent shall deliver complete copies of such
Security Agreement and Assignment and consents concurrently
with the Construction Agent's entering into such contracts).
Counterparts of the supplement to the Construction Agency
Agreement for such Leased Property duly executed by the
Construction Agent and the Lessor, shall have been delivered
to the Agent.
(v) Survey. If such Leased Property is a Major Property, the
related Lessee shall have delivered, or shall have caused to
be delivered, to the Lessor and the Agent, at such Lessee's
expense, an accurate survey certified to the Lessor and the
Agent in a form reasonably
satisfactory to the Lessor and the Agent and showing no state
of facts unsatisfactory to the Lessor or the Agent and
prepared within ninety (90) days of the Closing Date by a
Person reasonably satisfactory to the Lessor and the Agent.
Such survey shall (1) be acceptable to the Title Insurance
Company for the purpose of providing extended coverage to the
Lessor and a lender's comprehensive endorsement to the Agent,
(2) show no encroachments on such Land by structures owned by
others, and no encroachments from any part of such Leased
Property onto any land owned by others, and (3) disclose no
state of facts reasonably objectionable to the Lessor, the
Agent or the Title Insurance Company, and be reasonably
acceptable to each such Person.
(vi) Title and Title Insurance. On such Closing Date, the Lessor
shall receive from a title insurance company acceptable to the
Lessor and the Agent an ALTA Owner's Policy of Title Insurance
issued by such title insurance company and the Agent shall
receive from such title insurance company an ALTA Mortgagee's
Policy of Title Insurance issued by such title insurance
company, in each case, in the amount of the projected cost of
acquisition and construction of such Leased Property,
reasonably acceptable in form and substance to the Lessor and
the Agent, respectively (collectively, the "Title Policy").
The Title Policy shall be dated as of the Closing Date, and,
to the extent permitted under Applicable Law, shall include
such affirmative endorsements as the Lessor or the Agent shall
reasonably request.
(vii) Appraisal. If such Leased Property is a Major Property or if
requested by the Agent (provided that the Agent shall not be
entitled to so request an Appraisal with respect to more than
five Minor Properties) each Funding Party shall have received
a report of the Appraiser (an "Appraisal"), paid for by the
related Lessee, which shall meet the requirements of the
Financial Institutions Reform, Recovery and Enforcement Act of
1989, shall be satisfactory to such Funding Party and shall
state in a manner satisfactory to such Funding Party the
estimated "as vacant" value of such Land and the Building to
be constructed thereon. Such Appraisal must show that the "as
vacant" value of the Leased Property (determined as if the
Building had already been completed in accordance with the
related Plans and Specifications and by excluding from such
value the amount of assessments on such Leased Property) is at
least 45% of the total cost of the Leased Property, including
the trade fixtures, equipment and personal property utilized
in connection with the Leased Property and to be funded by the
Funding Parties. Upon request by the related Lessee, the
Funding Parties agree to waive delivery on such Closing Date
of an Appraisal, provided that no subsequent Funding with
respect to such Leased Property shall occur until such
Appraisal has been delivered.
(viii)Environmental Audit and related Reliance Letter. The Lessor
and the Agent shall have received an Environmental Audit for
such Leased Property, which shall be conducted in accordance
with ASTM standards and shall not include a recommendation for
further investigation and is otherwise satisfactory to the
Lessor and the Agent; and the firm that prepared the
Environmental Audit for such Leased Property shall have
delivered to the Lessor and the Agent a letter stating that
the Lessor, the Agent, the Lender and the Liquidity Banks may
rely upon such firm's Environmental Audit of such Land, it
being understood that the Lessor's and the Agent's acceptance
of any such Environmental Audit shall not release or impair
any Lessee's obligations under the Operative Documents with
respect to any environmental liabilities relating to such
Leased Property.
(ix) Evidence of Insurance. If such Leased Property is a Major
Property, the Lessor and the Agent shall have received from
the related Lessee certificates of insurance evidencing
compliance with the provisions of Article VIII of the Lease
(including the naming of the Lessor, the Agent, the Lender and
the Liquidity Banks as additional insured or loss payee with
respect to such insurance as their interests may appear), in
form and substance reasonably satisfactory to the Lessor and
the Agent.
(x) UCC Financing Statement; Recording Fees; Transfer Taxes. Each
Funding Party shall have received satisfactory evidence of (i)
the execution and delivery to Agent of a UCC-1 and, if
required by applicable law, UCC-2 financing statement to be
filed with the Secretary of State of the applicable State (or
other appropriate filing office) and the county where the
related Land is located, respectively, and such other Uniform
Commercial Code financing statements as any Funding Party
deems necessary or desirable in order to perfect such Funding
Party's or the Agent's interests and (ii) the payment of all
recording and filing fees and taxes with respect to any
recordings or filings made of the related Deed, the related
Lease Supplement, the related Mortgage and the related
Assignment of Lease and Rents.
(xi) Opinions. If such Leased Property is a Major Property or if
such Leased Property is the first Leased Property to be
located in a particular state, the opinion of local counsel
for the related Lessee qualified in the jurisdiction in which
such Leased Property is located, substantially in the form set
forth in Exhibit G-2 attached hereto, and containing such
other matters as the parties to whom they are addressed shall
reasonably request, shall have been delivered and addressed to
each of the Lessor, the Agent, the Lender, the Administrator
and the Liquidity Banks. To the extent requested by the Agent,
opinions supplemental to those delivered under Section
3.2(vii) and reasonably satisfactory to the Agent shall have
been delivered and addressed to each of the Lessor, the Agent,
the Lender, the Administrator and the Liquidity Banks.
(xii) Officer's Certificate. The Agent shall have received an
Officer's Certificate of the Lessor stating that, to the best
of such officer's knowledge, (A) each and every representation
and warranty of the Lessor contained in the Operative
Documents is true and correct in all Material respects on and
as of the Closing Date as though made on and as of the Closing
Date, except to the extent such representations or warranties
relate solely to an earlier date, in which case such
representations and warranties shall have been true and
correct in all Material respects on and as of such earlier
date; (B) no Event of Default or Potential Event of Default
has occurred and is continuing; (C) each Operative Document to
which the Lessor is a party is in full force and effect with
respect to it; and (D) no event that could have a Materially
Adverse Effect has occurred since the date of the most recent
financial statements of the Lessor delivered or required to be
delivered to the Agent.
(xiii)Good Standing Certificates. If such Leased Property is a
Major Property or if such Leased Property is the first Leased
Property to be located in a particular state by the related
Lessee, the Agent shall have received good standing
certificates for the Lessor and the related Lessee from the
appropriate offices of the state where the related Land is
located.
(b) Litigation. No action or proceeding shall have been instituted or,
to the knowledge of any Funding Party, threatened nor shall any
governmental action, suit, proceeding or investigation be
instituted or threatened before any Governmental Authority, nor
shall any order, judgment or decree have been issued or proposed to
be issued by any Governmental Authority, to set aside, restrain,
enjoin or prevent the performance of this Master Agreement or any
transaction contemplated hereby or by any other Operative Document
or which is reasonably likely to Materially adversely affect the
Leased Property or any transaction contemplated by the Operative
Documents or which could reasonably be expected to result in a
Materially Adverse Effect.
(c) Legality. In the opinion of such Funding Party or its counsel, the
transactions contemplated by the Operative Documents shall not
violate any Applicable Law, and no change shall have occurred or
been proposed in Applicable Law that would make it illegal for such
Funding Party to participate in any of the transactions
contemplated by the Operative Documents.
(d) No Events. (i) No Event of Default, Potential Event of Default,
Event of Loss or Event of Taking relating to such Leased Property
shall have occurred and be continuing, (ii) no action shall be
pending or threatened by a Governmental Authority to initiate a
Condemnation or an Event of Taking, and (iii) there shall not have
occurred any event that could reasonably be expected to have a
Materially Adverse Effect since January 29, 1999.
(e) Representations. Each representation and warranty of the parties
hereto or to any other Operative Document contained herein or in
any other Operative Document shall be true and correct in all
Material respects as though made on and as of the Closing Date,
except to the extent such representations or warranties relate
solely to an earlier date, in which case such representations and
warranties shall have been true and correct in all Material
respects on and as of such earlier date.
(f) Cutoff Date. No Closing Date shall occur after the Funding
Termination Date.
(g) Transaction Expenses. The related Lessee shall have paid the
Transaction Costs then accrued and invoiced which such Lessee has
agreed to pay pursuant to Section 8.8.
SECTION 3.2 Additional Conditions for the Initial Closing Date.
The obligations of the Lessor and the Lender to carry out their
respective obligations under Section 2 of this Master Agreement to be performed
on the initial Closing Date shall be subject to the satisfaction of, or waiver
by, each such party hereto (acting directly or through its counsel) on or prior
to the initial Closing Date of the following conditions precedent in addition to
those set forth in Section 3.1, provided that the obligations of any Funding
Party shall not be subject to any conditions contained in this Section 3.2 which
are required to be performed by such Funding Party:
(i) Guaranty. Counterparts of the Guaranty Agreement, duly
executed by Dollar, shall have been delivered to each Funding
Party.
(ii) Loan Agreement. Counterparts of the Loan Agreement, duly
executed by the Lessor, the Agent and the Lender shall have
been delivered to each of the Lessor and the Agent. An A Note
and a B Note, duly executed by the Lessor, shall have been
delivered to the Lender.
(iii) Master Agreement. Counterparts of this Master Agreement, duly
executed by the parties hereto, shall have been delivered to
each of the parties hereto.
(iv) Construction Agency Agreement. Counterparts of the
Construction Agency Agreement, duly executed by the parties
thereto, shall have been delivered to each of the parties
hereto.
(v) Lease. Counterparts of the Lease, duly executed by each Lessee
party hereto on the Initial Closing Date, respectively, and
the Lessor, shall have been delivered to each Funding Party
and the original, chattel paper copy of such Lease shall have
been delivered to the Agent.
(vi) Lessee's Resolutions and Incumbency Certificate, etc. Each of
the Agent and the Lessor shall have received (x) a certificate
of the Secretary or an Assistant Secretary of each Lessee
party hereto on the Initial Closing Date, attaching and
certifying as to (i) the Board of Directors' (or appropriate
committee's) resolution duly authorizing the execution,
delivery and performance by it of each Operative Document to
which it is or will be a party, (ii) the incumbency and
signatures of persons authorized to execute and deliver such
documents on its behalf, (iii) its articles or certificate of
incorporation, certified as of a recent date by the Secretary
of State of the state of its incorporation and (iv) its
by-laws, and (y) good standing certificates for such Lessee
from the appropriate offices of the States of such Person's
incorporation and principal place of business.
(vii) Opinions of Counsel. The opinion of Xxxxx Xxxxxxx, dated the
initial Closing Date, substantially in the form set forth in
Exhibit G-1 attached hereto, and containing such other matters
as the parties to whom it is addressed shall reasonably
request, shall have been delivered and addressed to each of
the Lessor, the Agent, the Lender, the Administrator and the
Liquidity Banks. The opinion of Xxxxx XxXxxxxxx & Oaks
Xxxxxxxx, L.L.P., dated the initial Closing Date,
substantially in the form set forth in Exhibit G-3 attached
hereto, and containing such other matters as the parties to
whom it is addressed shall reasonably request, shall have been
delivered to each of the Agent, the Lender, the Administrator
and the Liquidity Banks.
(viii)Good Standing Certificate. The Agent shall have received a
good standing certificate for the Lessor from the appropriate
offices of the State of Texas.
(ix) Lessor's Consents and Incumbency Certificate, etc. The Agent
shall have received a certificate of the Secretary or an
Assistant Secretary of the General Partner of the Lessor
attaching and certifying as to (i) the consents of the
partners of the Lessor duly authorizing the execution,
delivery and performance by it of each Operative Document to
which it is or will be a party, (ii) the incumbency and
signatures of persons authorized to execute and deliver such
documents on its behalf, and (iii) the Partnership Agreement.
(x) Liquidity Agreement. Counterparts of the Liquidity Agreement,
duly executed by the parties thereto, shall have been
delivered to each of the parties thereto.
(xi) Rating Agency Approval. The Rating Agencies that rate the
Commercial Paper shall have confirmed the rating of the
Commercial Paper, after giving effect to the transactions
contemplated hereby.
(xi) Fee Letter. Counterparts of the Fee Letter, duly executed by
the parties thereto shall have been delivered to the Agent.
SECTION 3.3 Conditions to the Obligations of Lessee.
The obligations of any Lessee to lease a Leased Property from the
Lessor are subject to the fulfillment on the related Closing Date to the
satisfaction of, or waiver by, such Lessee, of the following conditions
precedent:
(a) General Conditions. The conditions set forth in Sections 3.1 and
3.2 that require fulfillment by the Lessor or the Lender shall have
been satisfied, including the delivery of good standing
certificates by the Lessor pursuant to Sections 3.1(a)(xiv) and
3.2(b)(viii) and the delivery of an opinion of counsel for the
Lessor pursuant to Section 3.2(b)(vii).
(b) Legality. In the opinion of such Lessee or its counsel, the
transactions contemplated by the Operative Documents shall not
violate any Applicable Law, and no change shall have occurred or
been proposed in Applicable Law that would make it illegal for such
Lessee to participate in any of the transactions contemplated by
the Operative Documents.
(c) Purchase Agreement; Ground Lease. The Purchase Agreement and, if
applicable, the Ground Lease shall be reasonably satisfactory to
such Lessee.
SECTION 3.4 Conditions to the Obligations of the Funding Parties on
each Funding Date.
The obligations of the Lessor and the Lender to carry out their
respective obligations under Section 2 of this Master Agreement to be performed
on each Funding Date shall be subject to the fulfillment to the satisfaction of,
or waiver by, each such party hereto (acting directly or through their
respective counsel) on or prior to each such Funding Date of the following
conditions precedent, provided that the obligations of any Funding Party shall
not be subject to any conditions contained in this Section 3.4 which are
required to be performed by such Funding Party:
(a) Funding Request. The Lessor, the Agent and the Administrator shall
have received from the Construction Agent the Funding Request
therefor pursuant to Section 2.2(d).
(b) Condition Fulfilled. As of such Funding Date, the condition set
forth in Section 3.1(d)(i) shall have been satisfied.
(c) Representations. As of such Funding Date, both before and after
giving effect to the Funding requested by the Construction Agent on
such date, the representations and warranties that the Lessees are
deemed to make pursuant to Section 2.2(e) shall be true and correct
in all Material respects on and as of such Funding Date as though
made on and as of such Funding Date, except to the extent such
representations or warranties relate solely to an earlier date, in
which case such representations and warranties shall have been true
and correct in all Material respects on and as of such earlier
date.
(d) No Bonded Stop Notice or Filed Mechanics Lien. As of each Funding
Date, and as to any Funded Amount requested for any Leased Property
on each such Funding Date, (i) neither the Lessor, the Agent, the
Lender nor the Administrator has received (with respect to such
Leased Property) a bonded notice to withhold Loan funds that has
not been discharged by the related Lessee or the Construction
Agent, and (ii) no mechanic's liens or materialman's liens have
been filed against such Leased Property that have not been
discharged by the related Lessee, bonded over in a manner
reasonably satisfactory to the Agent or insured over by the Title
Insurance Company.
(e) Lease Supplement. If the Funding relates to a Building that will be
leased under a Lease Supplement separate from the Lease Supplement
for the related Land, the original of such separate Lease
Supplement, duly executed by the related Lessee and the Lessor and
in recordable form, shall have been delivered to the Agent.
SECTION 3.5 Completion Date Conditions.
The occurrence of the Completion Date with respect to any Leased
Property shall be subject to the fulfillment to the satisfaction of, or waiver
by, each party hereto (acting directly or through its counsel) of the following
conditions precedent:
(a) Title Policy Endorsements; Architect's Certificate. If such Leased
Property is a Major Property, the Construction Agent shall have
furnished to each Funding Party (1) the following endorsements to
the related Title Policy (each of which shall be subject to no
exceptions other than those reasonably acceptable to the Agent): a
date-down endorsement (redating and confirming the coverage
provided under the Title Policy and each endorsement thereto) and a
"Form 9" endorsement (if available in the applicable jurisdiction),
in each case, effective as of a date not earlier than the date of
completion of the Construction, and (2) a certificate of the
Architect or the related General Contractor dated at or about the
Completion Date, in form and substance reasonably satisfactory to
the Agent and the Lessor, and stating that (i) the related Building
has been completed substantially in accordance with the Plans and
Specifications therefor, and such Leased Property is ready for
occupancy, (ii) such Plans and Specifications comply in all
Material respects with all Material Applicable Laws in effect at
such time, and (iii) to the best of the Architect's or General
Contractor's knowledge, such Leased Property, as so completed,
complies in all Material respects with all Material Applicable Laws
in effect at such time. If such Leased Property is a Major
Property, the Construction Agent shall also deliver to the Agent
true and complete copies of: (A) an "as built" or "record" set of
the Plans and Specifications, (B) a plat of survey of such Leased
Property "as built" to a standard reasonably acceptable to the
Agent showing all easements, paving, driveways, fences and exterior
improvements, and (C) copies of a certificate or certificates of
occupancy for such Leased Property or other legally equivalent
permission to occupy such Leased Property.
(b) Construction Completion. The related Construction shall have been
completed substantially in accordance with the related Plans and
Specifications, the related Deed and all Applicable Laws, and such
Leased Property shall be ready for occupancy and operation. All
fixtures, equipment and other property contemplated under the Plans
and Specifications to be incorporated into or installed in such
Leased Property shall have been substantially incorporated or
installed, free and clear of all Liens except for Permitted Liens.
(c) Construction Agent Certification. The Construction Agent shall have
furnished the Lessor, the Agent and the Lender with a certification
of the Construction Agent (substantially in the form of Exhibit F)
that:
(i) all amounts owing to third parties for the related
Construction have been paid in full (other than contingent
obligations for which the Construction Agent has made adequate
reserves), and no litigation or proceedings are pending, or to
the best of the Construction Agent's knowledge, are
threatened, against such Leased Property or the Construction
Agent or the related Lessee which could reasonably be expected
to have a Materially Adverse Effect;
(ii) all Material consents, licenses and permits and other
governmental authorizations or approvals required for such
Construction and operation of such Leased Property have been
obtained and are in full force and effect;
(iii) such Leased Property has available all services of public
facilities and other utilities necessary for use and operation
of such Leased Property for its intended purposes including,
without limitation, adequate water, gas and electrical supply,
storm and sanitary sewerage facilities, telephone, other
required public utilities and means of access between the
related Building and public highways for pedestrians and motor
vehicles;
(iv) all Material agreements, easements and other rights, public or
private, which are necessary to permit the lawful use and
operation of such Leased Property as the related Lessee
intends to use the Leased Property under the Lease and which
are necessary to permit the lawful intended use and operation
of all then intended utilities, driveways, roads and other
means of egress and ingress to and from the same have been
obtained and are in full force and effect and neither the
Construction Agent nor the related Lessee has any knowledge of
any pending modification or cancellation of any of the same;
and the use of such Leased Property does not depend on any
variance, special exception or other municipal approval,
permit or consent that has not been obtained and is in full
force and effect for its continuing legal use;
(v) all of the requirements and conditions set forth in Section
3.5(b) hereof have been completed and fulfilled with respect
to such Leased Property and the related Construction; and
(vi) such Leased Property is in compliance in all Material respects
with all applicable zoning laws and regulations.
SECTION 3.6 Addition of Lessees.
After the date hereof, additional Subsidiaries of Dollar may become
Lessees hereunder and under the other Operative Documents upon satisfaction of
the following conditions precedent:
such Subsidiary and the Guarantor shall have executed and delivered to
the Agent and the Lessor a Joinder Agreement, substantially in the form of
Exhibit E;
(a) such Subsidiary shall have delivered to each of the Agent and the
Lessor (x) a certificate of the Secretary or an Assistant Secretary
of such Subsidiary, attaching and certifying as to (i) the Board of
Directors' resolution duly authorizing the execution, delivery and
performance by it of each Operative Document to which it is or will
be a party, (ii) the incumbency and signatures of persons
authorized to execute and deliver such documents on its behalf,
(iii) its certificate of incorporation, certified as of a recent
date by the Secretary of State of its incorporation and (iv) its
by-laws, and (y) good standing certificates from the appropriate
offices of the States of such Subsidiary's incorporation and
principal place of business;
(b) such Subsidiary shall have delivered an opinion of Xxxxx Xxxxxxx,
addressed to each of the Lessor, the Agent, the Lender, the
Administrator and the Liquidity Banks, substantially in the form
set forth in Exhibit G-1; and
(c) the Agent, the Lessor, the Administrator and the Lender shall have
received such other documents, certificates and information as any
of them shall have reasonably requested.
SECTION 4 REPRESENTATIONS
SECTION 4.1 Representations of Lessees.
Effective as of the date of execution hereof (or as of the related
Joinder Agreement, as applicable), as of each Closing Date and as of each
Funding Date, each Lessee (which term, for purposes of this Section 4.1,
includes Dollar in its capacity as Guarantor) represents and warrants to each of
the other parties hereto as follows:
(a) Organization; Corporate Powers. Each of such Lessee and each of its
Subsidiaries (i) is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its
organization, (ii) is duly qualified as a foreign corporation and
in good standing (A) in each jurisdiction where a Leased Property
is located, in the case of such Lessee, and (B) under the laws of
each other jurisdiction where such qualification is required and
where the failure to be duly qualified and in good standing would
have a Materially Adverse Effect, in the case of such Lessee and
each of its Subsidiaries, and (iii) has all requisite corporate
power and authority to own, operate and encumber its property and
assets and to conduct its business as presently conducted and as
proposed to be conducted in connection with and following the
consummation of the transactions contemplated by the Operative
Documents.
(b) Authority. Such Lessee has the requisite corporate power and
authority to execute, deliver and perform the Operative Documents
executed by it, or to be executed by it. The execution, delivery
and performance (or recording or filing, as the case may be) of the
Operative Documents, and the consummation of the transactions
contemplated thereby, have been duly approved by the Board of
Directors of such Lessee, or an appropriate committee thereof, and
no other corporate proceedings on the part of such Lessee are
necessary to consummate the transactions so contemplated.
(c) Binding Obligations. The Operative Documents to which such Lessee
is a party, have been duly executed and delivered (or recorded or
filed, as the case may be) by such Lessee, and constitute its
legal, valid and binding obligation, enforceable against it in
accordance with their respective terms, except as enforcement may
be limited by bankruptcy, insolvency, reorganization, moratorium or
other laws relating to or limiting creditors' rights generally or
by equitable principles generally.
(d) No Conflict. The execution, delivery and performance by such Lessee
of each Operative Document to which it is a party and each of the
transactions contemplated thereby do not and will not (i) violate
the certificate of incorporation, by-laws or other organizational
documents of such Lessee, (ii) violate any Applicable Law or
Contractual Obligation of any Person, the consequences of which
violation, singly or in the aggregate, would have a Materially
Adverse Effect, (iii) result in or require the creation or
imposition of any Lien whatsoever on any Leased Property or upon
any of the properties or assets of such Lessee or any of its
Subsidiaries (other than Permitted Liens), or (iv) require any
approval of the stockholders of such Lessee which has not been
obtained and is in full force and effect.
(e) Governmental Consents. Except as have been made, obtained or given,
and are in full force and effect, and except for routine filings
with the SEC to be made in a timely fashion, no filing or
registration with, consent or approval of, notice to, with or by
any Governmental Authority, is required to authorize, or is
required in connection with, the execution, delivery and
performance by such Lessee of the Operative Documents, the use of
the proceeds of the Fundings made to effect the purchase of the
Land and the Construction, or the legality, validity, binding
effect or enforceability of any Operative Document.
(f) Governmental Regulation. Neither such Lessee nor any Subsidiary of
such Lessee is an "investment company" or a company "controlled" by
an "investment company", within the meaning of the Investment
Company Act of 1940, as amended. Such Lessee is not a "holding
company" or a "subsidiary company," or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company",
within the meaning of the Public Utility Company Act of 1935, as
amended, nor subject to regulation under the Federal Power Act, or
any foreign, federal or local statute or regulation limiting its
ability to incur Indebtedness for Money Borrowed, Guaranty such
indebtedness, pledge its assets to secure such indebtedness or
enter into lease arrangements.
(g) Requirements of Law. Such Lessee and each Subsidiary of such Lessee
and each Person acting on behalf of any of them is in compliance
with all Requirements of Law applicable to them and their
respective businesses, in each case where the failure to so comply
would have a Materially Adverse Effect, either individually or
together with other such cases.
(h) Rights in Respect of the Leased Property. Such Lessee is not a
party to any contract or agreement to sell any interest in any
Leased Property or any part thereof, other than pursuant to the
Operative Documents.
(i) Hazardous Materials - Leased Properties. To the best knowledge of
such Lessee, except as described in the related Environmental
Audit, on the Closing Date for each Leased Property, there are no
Hazardous Materials present at, upon, under or within such Leased
Property or released or transported to or from such Leased Property
(except in compliance in all Material respects with all Applicable
Law).
o On the related Closing Date, no Governmental Actions have been
taken or, to the best knowledge of such Lessee, are in process
or have been threatened, which could reasonably be expected to
subject such Leased Property, the Lender or the Lessor to any
Claims or Liens under any Environmental Law which would have a
Materially Adverse Effect, or would have a Materially adverse
effect on the Lessor or the Lender.
o Such Lessee has, or will obtain on or before the date required
by Applicable Law, all Environmental Permits necessary to
operate such Leased Property in accordance with Environmental
Laws and is complying with and has at all times complied with
all such Environmental Permits, except to the extent the
failure to obtain such Environmental Permits or to so comply
has not had, and would not have, a Materially Adverse Effect.
o Except as set forth in the related Environmental Audit or in
any notice subsequently furnished by such Lessee to the Agent
and approved by the Agent in writing prior to the respective
times that the representations and warranties contained herein
are made or deemed made hereunder, no notice, notification,
demand, request for information, citations, summons, complaint
or order has been issued or filed to or with respect to such
Lessee, no penalty has been assessed on such Lessee and no
investigation or review is pending or, to its best knowledge,
threatened by any Governmental Authority or other Person in
each case relating to the Leased Property with respect to any
alleged Material violation or liability of such Lessee under
any Environmental Law. To the best knowledge of such Lessee,
no Material notice, notification, demand, request for
information, citations, summons, complaint or order has been
issued or filed to or with respect to any other Person, no
Material penalty has been assessed on any other Person and no
investigation or review is pending or threatened by any
Governmental Authority or other Person relating to such Leased
Property with respect to any alleged Material violation or
liability under any Environmental Law by any other Person.
o Such Leased Property and each portion thereof are presently in
compliance in all Material respects with all Environmental
Laws, and, to the best knowledge of such Lessee, there are no
present or past facts, circumstances, activities, events,
conditions or occurrences regarding such Leased Property
(including without limitation the release or presence of
Hazardous Materials) that could reasonably be anticipated to
(A) form the basis of a Material Claim against such Leased
Property, any Funding Party or such Lessee, (B) cause such
Leased Property to be subject to any Material restrictions on
ownership, occupancy, use or transferability under any
Environmental Law, (C) require the filing or recording of any
notice or restriction relating to the presence of Hazardous
Materials in the real estate records in the county or other
appropriate municipality in which such Leased Property is
located, or (D) prevent or Materially interfere with the
continued operation and maintenance of such Leased Property as
contemplated by the Operative Documents.
(j) Leased Property. The present condition and use of such Leased
Property conforms in all Material respects with all conditions or
requirements of all existing Material permits and approvals issued
with respect to such Leased Property, and the present use of such
Leased Property and such Lessee's future intended use of such
Leased Property under the Lease does not, in any Material respect,
violate any Applicable Law. To the best knowledge of such Lessee,
no Material notices, complaints or orders of violation or
non-compliance have been issued or threatened or contemplated by
any Governmental Authority with respect to such Leased Property or
any present or intended future use thereof. All Material
agreements, easements and other rights, public or private, which
are necessary to permit the lawful use and operation of such Leased
Property as such Lessee intends to use such Leased Property under
the Lease and which are necessary to permit the lawful intended use
and operation of all presently intended utilities, driveways, roads
and other means of egress and ingress to and from the same have
been, or to such Lessee's best knowledge will be, obtained and are
or will be in full force and effect, and such Lessee has no
knowledge of any pending Material modification or cancellation of
any of the same.
(k) True and Complete Disclosure. All factual information relating to
such Lessee, or any of its assets or its financial condition, or
any of the Leased Properties heretofore or contemporaneously
furnished by such Lessee or on its behalf in writing to the Agent,
the Administrator or any Funding Party (including without
limitation all information contained in the Operative Documents)
for purposes of or in connection with any transaction contemplated
by this Master Agreement is, and all other such factual information
hereafter furnished by such Lessee or on its behalf in writing to
the Agent, the Administrator or any Funding Party will be, true and
accurate in all Material respects on the date as of which such
information is dated or certified and not incomplete by omitting to
state any Material fact necessary to make such information,
together with past written information supplied hereunder (taken as
a whole) not misleading at such time in light of the circumstances
under which such information was provided.
(l) Financial Statements. The consolidated statement of financial
position of Dollar as of January 29, 1999 and the related
statements of income, shareholders' equity and cash flows for the
fiscal year then ended, reported on by Deloitte & Touche LLP, a
copy of which has been delivered to each of the Agent, the
Administrator, the Liquidity Banks and the Funding Parties, present
fairly in all Material respects, in conformity with GAAP, the
consolidated financial position of Dollar and its Subsidiaries as
of such dates and the results of operations and cash flows of
Dollar and its Subsidiaries for such fiscal year. The Consolidated
Companies taken as a whole did not have any Material contingent
obligations, contingent liabilities or Material liabilities for
known taxes, long-term leases or unusual forward or long-term
commitments required to be reflected in the foregoing financial
statements or the notes thereto that are not so reflected.
(m) No Material Litigation. Except as set forth in Schedule 4.1(m), no
litigation, investigations or proceedings of or before any court,
tribunal, arbitrator or governmental authority is pending or, to
the knowledge of any Executive Officer of such Lessee, threatened
by or against any of the Consolidated Companies, or against any of
their respective Properties or revenues, existing or future (a)
with respect to any Operative Document, or any of the transactions
contemplated hereby or thereby, or (b) which, if adversely
determined, is reasonably likely to have a Materially Adverse
Effect.
(n) Margin Regulations. No part of the proceeds of any of the Fundings
will be used for any purpose which violates, or which would be
inconsistent or not in compliance with, the provisions of the
applicable Margin Regulations.
(o) Subsidiaries. The jurisdiction of incorporation or organization,
and the ownership of all issued and outstanding capital stock, for
each Subsidiary of Dollar, and the identity of each joint venture
or partnership in which Dollar or any Subsidiary of Dollar is a
partner is accurately described on Schedule 4.1(o). The foregoing
representation is made as of the date of this Master Agreement.
(p) Compliance With Environmental Laws.
o The Consolidated Companies have received no notices of claims
or potential liability under, and are in compliance with, all
applicable Environmental Laws, where such claims and
liabilities under, and failures to comply with, such statutes,
regulations, rules, ordinances, laws or licenses, is
reasonably likely to result in penalties, fines, claims or
other liabilities to the Consolidated Companies in amounts
that would have a Materially Adverse Effect, either
individually or in the aggregate (including any such
penalties, fines, claims, or liabilities relating to the
matters set forth on Schedule 4.1(p)), except as set forth on
Schedule 4.1(p)).
o Except as set forth on Schedule 4.1(p), none of the
Consolidated Companies has received any notice of violation,
or notice of any action, either judicial or administrative,
from any governmental authority (whether United States or
foreign) relating to the actual or alleged violation of any
Environmental Law, including, without limitation any notice of
any actual or alleged spill, leak, or other release of any
Hazardous Substance, waste or hazardous waste by any
Consolidated Company or its employees or agents, or as to the
existence of any continuation on any Properties owned by any
Consolidated Company, where any such violation, spill, leak,
release or contamination is reasonably likely to result in
penalties, fines, claims or other liabilities to the
Consolidated Companies in amounts that would have a Materially
Adverse Effect, either individually or in the aggregate.
o Except as set forth on Schedule 4.1(p), the Consolidated
Companies have obtained all necessary governmental permits,
licenses and approvals for the operations conducted on their
respective Properties, including without limitation, all
required Material permits, licenses and approvals for (i) the
emission of air pollutants or contaminants, (ii) the treatment
or pretreatment and discharge of waste water or storm water,
(iii) the treatment, storage, disposal or generation of
hazardous wastes, (iv) the withdrawal and usage of ground
water or surface water, and (v) the disposal of solid wastes,
in any such case where the failure to have such license,
permit or approval is reasonably likely to have a Materially
Adverse Effect.
(q) Insurance. The Consolidated Companies currently maintain such
insurance with respect to their Properties and business with
financially sound and reputable insurers, and in such amounts and
having such coverages against losses and damages which such Lessee
in the exercise of its reasonable prudent business judgment has
determined to be necessary to prevent the Consolidated Companies
from experiencing a loss which would cause a Materially Adverse
Effect. The Consolidated Companies have paid all Material amounts
of insurance premiums now due and owing with respect to such
insurance policies and coverages, and such policies and coverages
are in full force and effect.
(r) No Default. None of the Consolidated Companies is in default under
or with respect to any Contractual Obligation in any respect which
has had or is reasonably likely to have a Materially Adverse
Effect.
(s) No Burdensome Restrictions. Except as set forth on Schedule 4.1(s),
none of the Consolidated Companies is a party to or bound by any
Contractual Obligation or Requirement of Law or any provision of
its respective articles or certificate of incorporation, bylaws, or
other organizational or governing documents which has had or is
reasonably likely to have a Materially Adverse Effect.
(t) Taxes. The Consolidated Companies have filed all Federal tax
returns and, to the knowledge of any Executive Officer of such
Lessee, the Consolidated Companies have filed all other tax returns
which are required to have been filed in any jurisdiction; the
Consolidated Companies have paid all taxes shown to be due and
payable on such Federal returns and other returns and all other
taxes, assessments, fees and other charges payable by them, in each
case, to the extent the same have become due and payable and before
they have become delinquent, except for the filing of any such
returns or the payment of any taxes, assessments, fees and other
charges the amount, applicability or validity of which is currently
being contested in good faith by appropriate proceedings and with
respect to which any Consolidated Company has set aside on its
books reserves (segregated to the extent required by GAAP) deemed
by it in good faith to be adequate. Such Lessee has not received
written notice of any proposed Material tax assessment with respect
to Federal income taxes against any of the Consolidated Companies
nor does any Executive Officer of such Lessee know of any Material
Federal income tax liability on the part of the Consolidated
Companies other than any such assessment or liability which is
adequately reserved for on the books of the Consolidated Companies
in accordance with GAAP. 2.
(u) Year 2000 Issues. Dollar and the other Consolidated Companies (i)
have done a comprehensive review of their computer programs to
identify the systems that would be affected by Year 2000 Issues and
as such issues pertain to the computer programs and systems of the
Consolidated Companies (but not those of their third party
customers, suppliers or vendors), and are in the process of
reviewing their Year 2000 exposure to third party consumers,
suppliers and vendors, and evaluating the costs of modifications to
program logic control systems, (ii) have developed or are in the
process of developing a realistic and achievable program for
remediating in all material respects all currently known Year 2000
Issues on a timely basis as such issues pertain to the computer
programs and systems of the Consolidated Companies (but not those
of their third party customers, suppliers, or vendors), and (iii)
based on their review, consultants' reports, and all other
information currently available to them, do not reasonably
anticipate that Year 2000 Issues will have a Materially Adverse
Effect.
(v) ERISA. Except as disclosed on Schedule 4.1(v):
o Identification of Plans. None of the Consolidated Companies
nor any of their respective ERISA Affiliates maintains or
contributes to, or has during the past seven years maintained
or contributed to, any Plan that is subject to Title IV of
ERISA;
o Compliance. Each Plan maintained by the Consolidated Companies
has at all times been maintained, by their terms and in
operation, in compliance with all applicable laws, and the
Consolidated Companies are subject to no tax or penalty with
respect to any Plan of such Consolidated Company or any ERISA
Affiliate thereof, including without limitation, any tax or
penalty under Title I or Title IV of ERISA or under Chapter 43
of the Tax Code, or any tax or penalty resulting from a loss
of deduction under Section 162, 404 or 419 of the Tax Code,
where the failure to comply with such laws, and such taxes and
penalties, together with all other liabilities referred to in
this Section 4.1(v) (taken as a whole), would in the aggregate
have a Materially Adverse Effect;
o Liabilities. The Consolidated Companies are subject to no
liabilities (including withdrawal liabilities) with respect to
any Plans of such Consolidated Companies or any of their ERISA
Affiliates, including without limitation, any liabilities
arising from Title I or IV of ERISA, other than obligations to
fund benefits under an ongoing Plan and to pay current
contributions, expenses and premiums with respect to such
Plans, where such liabilities, together with all other
liabilities referred to in this Section 4.1(v) (taken as a
whole), would in the aggregate have a Materially Adverse
Effect;
o Funding. The Consolidated Companies and, with respect to any
Plan which is subject to Title IV of ERISA, each of their
respective ERISA Affiliates, have made full and timely payment
of all amounts (A) required to be contributed under the terms
of each Plan and applicable law, and (B) required to be paid
as expenses (including PBGC or other premiums) of each Plan,
where the failure to pay such amounts (when taken as a whole,
including any penalties attributable to such amounts) would
have a Materially Adverse Effect. No Plan subject to Title IV
of ERISA has an "amount of unfunded benefit liabilities" (as
defined in Section 4001(a)(18) of ERISA), determined as if
such Plan terminated on any date on which this representation
and warranty is deemed made, in any amount which, together
with all other liabilities referred to in this Section 4.1(v)
(taken as a whole) would have a Materially Adverse Effect if
such amount were then due and payable. The Consolidated
Companies are subject to no liabilities with respect to
post-retirement medical benefits in any amounts which,
together with all other liabilities referred to in this
Section 4.1(v)(taken as a whole), would have a Materially
Adverse Effect if such amounts were then due and payable.
(w) Patents, Trademarks, Licenses, Etc. Except as set forth on Schedule
4.1(w), (i) the Consolidated Companies have obtained and hold in
full force and effect all Material governmental authorizations,
consents, approvals, patents, trademarks, service marks,
franchises, trade names, copyrights, licenses and other such
rights, free from burdensome restrictions, which are necessary for
the operation of their respective businesses as presently
conducted, and (ii) to the best of such Lessee's knowledge, no
product, process, method, service or other item presently sold by
or employed by any Consolidated Company in connection with such
business infringes any patents, trademark, service xxxx, franchise,
trade name, copyright, license or other right owned by any other
Person and there is not presently pending, or to the knowledge of
such Lessee, threatened, any claim or litigation against or
affecting any Consolidated Company contesting such Person's right
to sell or use any such product, process, method, substance or
other item where the result of such failure to obtain and hold such
benefits or such infringement would have a Materially Adverse
Effect.
(x) Ownership of Property; Liens.
o Except as set forth on Schedule 4.1(x), (i) each Consolidated
Company has good and marketable fee simple title to or a valid
leasehold interest in all of its real property and good title
to all of its other Property, as such Properties are reflected
in the consolidated balance sheet of the Consolidated
Companies as of January 29, 1999, except where the failure to
hold such title, leasehold interest, or possession would not
have a Materially Adverse Effect, other than Properties
disposed of in the ordinary course of business since such date
or as otherwise permitted by the terms of this Master
Agreement, subject to no known Lien or title defect of any
kind, except Liens permitted hereunder and (ii) the
Consolidated Companies enjoy peaceful and undisturbed
possession under all of their respective leases except where
the failure to enjoy peaceful and undisturbed possession would
not have a Materially Adverse Effect.
o As of the date of this Master Agreement, the Property owned by
each Consolidated Company is not subject to any Lien securing
any Indebtedness or other obligation of such Consolidated
Company in excess of $2,500,000, individually or in the
aggregate, other than as described on Schedule 4.1(x) hereof.
(y) Indebtedness. As of the date of this Master Agreement, other than
as described on Schedule 4.1(y), the Consolidated Companies, on a
consolidated basis, are not obligors (singularly or in the
aggregate) in respect of any Indebtedness for Borrowed Money in
excess of $2,500,000 or any commitment to create or incur any
Indebtedness for Borrowed Money in excess of $2,500,000.
(z) Financial Condition. On the Initial Closing Date and after giving
effect to the transactions contemplated by this Master Agreement
and the other Operative Documents, the Property of each of Dollar,
on a stand alone basis, and of Dollar and the Consolidated
Companies, taken as a whole, at fair valuation and based on their
present fair saleable value will exceed Dollar's or such
consolidated group's, as applicable, debts, including contingent
liabilities, (ii) the remaining capital of Dollar or such
consolidated group, as applicable, will not be unreasonably small
to conduct Dollar's or such consolidated group's, as applicable,
business, and (iii) Dollar or such consolidated group, as
applicable, will not have incurred debts, or have intended to incur
debts, beyond Dollar's or such consolidated group's, as applicable,
ability to pay such debts as they mature. For purposes of this
Section 4.1(z), "debt" means any liability on an obligation, and
"obligation" means (a) the right to payment, whether or not such
right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal,
equitable, secured or unsecured, or (b) the right to an equitable
remedy for breach of performance if such breach gives rise to a
right to payment, whether or not such right to an equitable remedy
is reduced to judgment, fixed, contingent, matured, unmatured,
disputed, undisputed, secured or unsecured.
(aa) Labor Matters. Except as set forth in Schedule 4.1(aa), the
Consolidated Companies have experienced no strikes, labor disputes,
slow downs or work stoppages due to labor disagreements which is
reasonably likely to have, a Materially Adverse Effect, and, to the
best knowledge of the Executive Officers of such Lessee, there are
no such strikes, disputes, slow downs or work stoppages threatened
against any Consolidated Company except as disclosed in writing to
the Agent. The hours worked and payment made to employees of the
Consolidated Companies have not been in violation in any Material
respect of the Fair Labor Standards Act or any other applicable law
dealing with such matters, and all payments due from the
Consolidated Companies, or for which any claim may be made against
the Consolidated Companies, on account of wages and employee health
and welfare insurance and other benefits have been paid or accrued
as liabilities on the books of the Consolidated Companies, in each
case where the failure to comply with such laws or to pay or accrue
such liabilities is reasonably likely to have a Materially Adverse
Effect.
(bb) Payment or Dividend Restrictions. Except as described on Schedule
4.1(bb), none of the Consolidated Companies is party to or subject
to any agreement or understanding restricting or limiting the
payment of any dividends or other distributions by any such
Consolidated Company.
(cc) Financial Projections. The financial projections and other pro
forma financial information delivered to the Agent, any Liquidity
Bank or the Administrator on or prior to the date of this Master
Agreement were based on good faith estimates and assumptions
believed by the applicable Consolidated Companies to be reasonable
at the time made and at the time furnished to the Agent and/or the
Administrator, it being recognized by the Funding Parties and the
Liquidity Banks that such projections and other pro forma financial
information as to future events such projections and other pro
forma financial information may differ from the projected results
for such period
or periods.
(dd) Notice of Violations. Such Lessee has not received notice, and no
Consolidated Company has received notice, that it is in violation
of any Requirement of Law, judgment, court order, rule, or
regulation that would be expected to have a Materially Adverse
Effect.
(ee) Filings. Such Lessee has filed all reports and statements required
to be filed with the Securities and Exchange Commission. As of
their respective dates, the reports and statements referred to
above complied in all Material respects with all rules and
regulations promulgated by the Securities and Exchange Commission
and did not contain any untrue statement of a Material fact or omit
to state a Material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under
which they were made, not misleading.
SECTION 4.2 Representations of the Lessor.
Effective as of the date of execution hereof, as of each Closing Date
and as of each Funding Date, in each case, with respect to each of the Leased
Properties, the Lessor represents and warrants to the other parties hereto as
follows:
(a) Securities Act. The interest being acquired or to be acquired by
the Lessor in such Leased Property is being acquired for its own
account, without any view to the distribution thereof or any
interest therein, provided that the Lessor shall be entitled to
assign, convey or transfer its interest in accordance with Section
6.1.
(b) Due Organization, etc. The Lessor is a limited partnership duly
organized and validly existing in good standing under the laws of
Texas and each state in which a Leased Property is located and has
full power, authority and legal right to execute, deliver and
perform its obligations under the Lease, this Master Agreement and
each other Operative Document to which it is or will be a party.
(c) Due Authorization; Enforceability, etc. This Master Agreement and
each other Operative Document to which the Lessor is or will be a
party have been or will be duly authorized, executed and delivered
by or on behalf of the Lessor and are, or upon execution and
delivery will be, legal, valid and binding obligations of the
Lessor enforceable against it in accordance with their respective
terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting creditors' rights
generally and by general equitable principles.
(d) No Conflict. The execution and delivery by the Lessor of the Lease,
this Master Agreement and each other Operative Document to which
the Lessor is or will be a party, are not or will not be, and the
performance by the Lessor of its obligations under each thereof
will not be, inconsistent with its Partnership Agreement, do not
and will not contravene any Applicable Law and do not and will not
contravene any provision of, or constitute a default under, any
Contractual Obligation of Lessor, do not and will not require the
consent or approval of, the giving of notice to, the registration
with or taking of any action in respect of or by, any Governmental
Authority, except such as have been obtained, given or
accomplished, and the Lessor possesses all requisite regulatory
authority to undertake and perform its obligations under the
Operative Documents to which it is a party.
(e) Litigation. There are no pending or, to the knowledge of the
Lessor, threatened actions or proceedings against the Lessor before
any court, arbitrator or administrative agency with respect to any
Operative Document or that would have a material adverse effect
upon the ability of the Lessor to perform its obligations under
this Master Agreement or any other Operative Documents to which it
is or will be a party.
(f) Lessor Liens. No Lessor Liens (other than those created by the
Operative Documents) exist on any Closing Date on the Leased
Property, or any portion thereof, and the execution, delivery and
performance by the Lessor of this Master Agreement or any other
Operative Document to which it is or will be a party will not
subject the Leased Property, or any portion thereof, to any Lessor
Liens (other than those created by the Operative Documents).
(g) Employee Benefit Plans. The Lessor is not and will not be making
its investment hereunder, and is not performing its obligations
under the Operative Documents, with the assets of an "employee
benefit plan" (as defined in Section 3(3) of ERISA) which is
subject to Title I of ERISA, or "plan" (as defined in Section
4975(e)(1)) of the Code.
(h) General Partner. The sole general partner of the Lessor is Atlantic
Financial Managers, Inc.
(i) Financial Information. (A) The unaudited balance sheet of the
Lessor as of December 31, 1998 and the related statements of
income, partners' capital and cash flows for the year then ended,
copies of which have been delivered to the Agent, fairly present,
in conformity with sound accounting principles, the financial
condition of the Lessor as of such dates and the results of
operations and cash flows for such periods. (B) Since December 31,
1998, there has been no event, act, condition or occurrence having
a material adverse effect upon the financial condition, operations,
performance or properties of the Lessor, or the ability of the
Lessor to perform in any material respect under the Operative
Documents.
(j) No Offering. The Lessor has not offered the Notes to any Person in
any manner that would subject the issuance thereof to registration
under the Securities Act.
SECTION 4.3 Representations of the Lender.
Effective as of the date of execution hereof, as of each Closing Date
and as of each Funding Date, the Lender represents and warrants to the Lessor
and to the Lessees as follows:
(a) Securities Act. The interest being acquired or to be acquired by
the Lender in the Funded Amounts is being acquired for its own
account, without any view to the distribution thereof or any
interest therein, provided that the Lender shall be entitled to
assign, convey or transfer its interest in accordance with Section
6.2.
(b) Employee Benefit Plans. The Lender is not and will not be making
its investment hereunder, and is not performing its obligations
under the Operative Documents, with the assets of an "employee
benefit plan" (as defined in Section 3(3) of ERISA) which is
subject to Title I of ERISA, or "plan" (as defined in Section
4975(e)(1)) of the Code.
SECTION 5 COVENANTS OF THE LESSEES AND THE LESSOR
SECTION 5.1 Affirmative Covenants.
Each Lessee will:
(a) Corporate Existence, Etc. Preserve and maintain, and cause each of
the Consolidated Companies to preserve and maintain, its corporate
existence, its Material rights, franchises, and licenses, and its
Material patents and copyrights (for the scheduled duration
thereof), trademarks, trade names, and service marks, necessary or
desirable in the normal conduct of its business, and its
qualification to do business as a foreign corporation in all
jurisdictions where it conducts business or other activities making
such qualification necessary, where the failure to be so qualified
would reasonably be expected to have a Materially Adverse Effect.
(b) Compliance with Laws, Etc. Comply, and cause each Consolidated
Company to comply, with all Requirements of Law and Contractual
Obligations applicable to or binding on any of them where the
failure to comply with such Requirements of Law and Contractual
Obligations would reasonably be expected to have a Materially
Adverse Effect.
(c) Payment of Taxes and Claims, Etc. File, and cause each Consolidated
Company to file, all Federal, state, local and foreign tax returns
that are required to be filed by each of them and pay all taxes
that have become due pursuant to such returns or pursuant to any
assessment in respect thereof received by any Consolidated Company;
and each Consolidated Company will pay or cause to be paid all
other taxes, assessments, fees and other governmental charges and
levies which, to the knowledge of any of the Executive Officers of
any Consolidated Company, are due and payable before the same
become delinquent, except any such taxes and assessments as are
being contested in good faith by appropriate and timely proceedings
and as to which adequate reserves have been established in
accordance with GAAP.
(d) Keeping of Books. Keep, and cause each Consolidated Company to
keep, proper books of record and account, containing complete and
accurate entries of all their respective financial and business
transactions.
(e) Visitation, Inspection, Etc. Permit, and cause each Consolidated
Company to permit, any representative of the Lessor, the Agent, the
Administrator or any Liquidity Bank, at the Lessor's, the Agent's,
the Administrator's or such Liquidity Bank's expense, to visit and
inspect any of its Property and to discuss its affairs, finances
and accounts with its officers, all at such reasonable times and as
often as the Lessor, the Agent, the Administrator or such Liquidity
Bank may reasonably request after reasonable prior notice to
Dollar; provided, however, that at any time following the
occurrence and during the continuance of a Potential Event of
Default or an Event of Default, no prior notice to Dollar shall be
required.
(f) Insurance; Maintenance of Properties.
o Maintain or cause to be maintained with financially sound and
reputable insurers, such insurance with respect to its
Properties and business in such amounts as Dollar has
determined in the exercise of its reasonable prudent business
judgment is necessary to prevent the Consolidated Companies,
singularly or in the aggregate from experiencing a loss which
would cause a Materially Adverse Effect.
o Cause, and cause each of the Consolidated Companies to cause,
all Properties used or useful in the conduct of its business
to be maintained and kept in good condition, repair and
working order and supplied with all necessary equipment and
cause to be made all necessary repairs, renewals,
replacements, settlements and improvements thereof, all as in
the reasonable judgment of Dollar may be necessary so that the
business carried on in connection therewith may be properly
and advantageously conducted at all times; provided, however,
that nothing in this Section shall prevent Dollar from
discontinuing the operation or maintenance of any such
Properties if such discontinuance is, in the reasonable
judgment of Dollar, desirable in the conduct of its business
or the business of any Consolidated Company.
o Cause a summary, set forth in format and detail reasonably
acceptable to the Agent, of the types and amounts of insurance
(property and liability) maintained by the Consolidated
Companies to be delivered to the Agent on or before thirty
(30) days after the Initial Closing Date.
(g) Financial Reports. Furnish to the Lessor, the Agent, the
Administrator and each Liquidity Bank:
o Within fifty (50) days after the end of each of the first
three quarter-annual periods of each Fiscal Year (and, in any
event, in each case as soon as prepared), the quarterly
Financial Report of Dollar as of the end of that period,
prepared on a consolidated basis and accompanied by a
certificate, dated the date of furnishing, signed by a
Financial Officer of Dollar to the effect that such Financial
Report accurately presents in all Material respects the
consolidated financial condition of the Consolidated Companies
and that such Financial Report has been prepared in accordance
with GAAP consistently applied (subject to year end
adjustments), except that such Financial Report need not be
accompanied by notes.
o Within one hundred (100) days after the end of each Fiscal
Year (and, in any event, as soon as available), the annual
Financial Report of Dollar (with accompanying notes) for that
Fiscal Year prepared on a consolidated basis (which Financial
Report shall be reported on by Dollar's independent certified
public accountants, such report to state that such Financial
Report fairly presents in all Material respects the
consolidated financial condition and results of operation of
the Consolidated Companies in accordance with GAAP and to be
without any Material qualifications or exceptions). The audit
opinion in respect of the consolidated Financial Report shall
be the unqualified opinion of one of the nationally recognized
"Big Five" firms of independent certified public accountants
acceptable to Agent.
o Within fifty (50) days after the end of each of its first
three quarterly accounting periods and within one hundred
(100) days after the end of each Fiscal Year, a statement
certified as true and correct by a Financial Officer of
Dollar, substantially in the form of Exhibit H hereto, with
back-up material setting forth in reasonable detail such
calculations attached thereto and stating whether any
Potential Event of Default or Event of Default has occurred
and is continuing, and if a Potential Event of Default or
Event of Default has occurred and is continuing, stating
Dollar's intentions with respect thereto;
o Within fifty (50) days after the end of each of its quarterly
accounting periods (including the year end quarterly period),
a statement certified as true and correct by a Financial
Officer of Dollar setting forth the Consolidated Funded Debt
to Total Capitalization Ratio and the Fixed Charge Coverage
Ratio as of the last day of such quarterly accounting period.
o Promptly upon the filing thereof or otherwise becoming
available, copies of all financial statements, annual,
quarterly and special reports (including, without limitation,
Dollar's 8-K, 10-K, and 10-Q reports), proxy statements and
notices sent or made available generally by Dollar to its
public security holders, of all regular and periodic reports
and all registration statements and prospectuses, if any,
filed by any of them with any securities exchange or with the
Securities and Exchange Commission, and of all press releases
and other statements made available generally to the public
containing Material developments in the business or financial
condition of Dollar and the other Consolidated Companies.
o Promptly upon receipt thereof, copies of all financial
statements of, and all reports submitted by, independent
public accountants to Dollar in connection with each annual
and interim financial statement, including without limitation,
restatement of its financial statements or other special audit
of Dollar's financial statements that would be required to be
disclosed pursuant to Applicable Law.
o As soon possible and in any event within thirty (30) days
after Dollar or any Consolidated Company knows or has reason
to know that any "Reportable Event" (as defined in Section
4043(b) of ERISA) with respect to any Plan has occurred (other
than such a Reportable Event for which the PBGC has waived the
30-day notice requirement under Section 4043(a) of ERISA) and
such Reportable Event involves a matter that has had, or is
reasonably likely to have, a Materially Adverse Effect, a
statement of a Financial Officer of the applicable
Consolidated Company setting forth details as to such
Reportable Event and the action which the applicable
Consolidated Company proposes to take with respect thereto,
together with a copy of the notice of such Reportable Event
given to the PBGC if a copy of such notice is available to the
applicable Consolidated Company.
o With reasonable promptness, such other information relating to
Dollar's performance of this Master Agreement or its financial
condition as may reasonably be requested from time to time by
the Agent.
o Concurrently with the furnishing of the annual consolidated
Financial Report required pursuant to Section 5.1(g)(ii)
hereof, furnish or cause to be furnished to the Lessor, the
Agent, the Administrator and each Liquidity Bank a certificate
of compliance in a form reasonably satisfactory to the Agent
prepared by one of the nationally recognized "Big Five"
accounting firms stating that in making the examination
necessary for their audit, they have obtained no knowledge of
any Potential Event of Default or Event of Default, or if they
have obtained such knowledge, disclosing the nature, details
and period of existence of such event.
o Promptly after the formation or acquisition of any new
Subsidiary, notice thereof, together with the name and
jurisdiction of incorporation of such Subsidiary.
(h) Notices Under Certain Other Indebtedness. Immediately upon its
receipt thereof, furnish the Agent a copy of any notice received by
it or any other Consolidated Company from the holder(s) of
Indebtedness (or from any trustee, agent, attorney, or other party
acting on behalf of such holder(s)) in an amount which, in the
aggregate, exceeds $10,000,000.00 where such notice states or
claims (i) the existence or occurrence of any default or event of
default with respect to such Indebtedness under the terms of any
indenture, loan or credit agreement, debenture, note, or other
document evidencing or governing such Indebtedness, or (ii) the
existence or occurrence of any event or condition which requires or
permits holder(s) of any Indebtedness of the Consolidated Companies
to exercise rights under any Change in Control Provision.
(i) Notice of Litigation. Notify the Agent of any actions, suits or
proceedings instituted by any Person against the Consolidated
Companies where the uninsured portion of the money damages sought
(which shall include any deductible amount to be paid by Dollar or
any Consolidated Company) is singularly in an amount in excess of
$25,000,000.00 or where unreserved amounts in the aggregate are in
excess of $25,000,000.00 or which is reasonably likely to have a
Materially Adverse Effect. Said notice is to be given along with
the quarterly and annual reports required by Section 5.1(g) hereof,
and is to specify the amount of damages being claimed or other
relief being sought, the nature of the claim, the Person
instituting the action, suit or proceeding, and any other
significant features of the claim.
(j) Subsidiary Guaranties.
o Subject to subsection (iii) below, Dollar shall cause all of
the Consolidated Companies existing as of the Initial Closing
Date to execute and deliver on or before the Initial Closing
Date a Subsidiary Guaranty in substantially the same form as
set forth in Exhibit I. The delivery of such documents shall
be accompanied by such other documents as the Agent may
reasonably request (e.g., certificates of incorporation,
articles of incorporation and bylaws, membership operating
agreements, opinion letters and appropriate resolutions of the
Board of Directors of any such Subsidiary Guarantor).
o Subject to subsection (iii) below, Dollar shall cause each
Consolidated Company not existing as of the Initial Closing
Date to execute and deliver Subsidiary Guaranties in
substantially the same form as set forth in Exhibit I
simultaneously with the creation or acquisition of any such
Consolidated Company by Dollar or any other such Consolidated
Company. The delivery of such documents shall be accompanied
by such other documents as the Agent may reasonably request
(e.g., certificates of incorporation, articles of
incorporation and bylaws, membership operating agreements,
opinion letters and appropriate resolutions of the Board of
Directors of any such Subsidiary Guarantor).
o Notwithstanding the foregoing subsections (i) and (ii), Dollar
shall not be required to cause any Consolidated Company to
deliver a Subsidiary Guaranty if the delivery of such
documents would cause such Consolidated Company to violate any
Requirement of Law.
(k) Existing Business. Remain and cause each Consolidated Company to
remain engaged in business of the same general nature and type as
conducted by the Consolidated Companies, taken as a whole, on the
Initial Closing Date.
(l) ERISA information and Compliance. Comply and cause each
Consolidated Company to comply with ERISA and all other applicable
laws governing any pension or profit sharing plan or arrangement to
which any Consolidated Company is a party. Dollar shall provide and
shall cause each Consolidated Company to provide the Agent with
notice of any "reportable event" or "prohibited transaction" or the
imposition of a "withdrawal liability" within the meaning of ERISA.
(m) Financial Requirements. Not:
o Fixed Charge Coverage Ratio. Suffer or permit, as of the last
day of any fiscal quarter, the ratio of (A) Consolidated EBITR
to (B) the sum of (i) Consolidated Interest Expense, plus (ii)
Consolidated Rental Expense to be less than 2.0 to 1.0, as
calculated for the most recently concluded quarter and the
immediately three (3) preceding fiscal quarters.
o Consolidated Funded Debt to Total Capitalization Ratio.
Permit, as of the last day of any fiscal quarter, the ratio of
Consolidated Funded Debt to Total Capitalization to be greater
than .50 to 1.0.
(n) Liens. Not, and will not permit any Consolidated Company to,
create, assume or suffer to exist any Lien upon any of their
respective Properties whether now owned or hereafter acquired;
provided, however, that this Section 5.1(n) shall not apply to the
following:
o any Lien for taxes not yet due or taxes or assessments or
other governmental charges which are being actively contested
in good faith by appropriate proceedings and as to which
adequate reserves have been established in accordance with
GAAP;
o any customary Liens, pledges or deposits in connection with
worker's compensation, unemployment insurance, or social
security, or deposits incidental to the conduct of the
business of any Consolidated Company or the ownership of any
of their Properties which were not incurred in connection with
the borrowing of money or the obtaining of advances or credit
and which do not in the aggregate Materially detract from the
value of their Properties or Materially impair the use thereof
in the operation of their businesses;
o any customary Liens to secure the performance of tenders,
statutory obligations, surety and appeal bonds, and similar
obligations and as to which adequate reserves have been
established in accordance with GAAP;
o any Lien incurred in connection with Purchase Money
Indebtedness and placed upon any Property (other than
inventory) at the time of its acquisition (or within 60 days
thereafter) by any Consolidated Company to secure all or a
portion of the purchase price therefor; provided, that any
such Lien shall not encumber any other Properties of any
Consolidated Company;
o statutory Liens of carriers, warehousemen, mechanics,
materialmen and other Liens imposed by law created in the
ordinary course of business for amounts not yet due or which
are being contested in good faith by appropriate proceedings
and as to which adequate reserves have been established in
accordance with GAAP or bonded off;
o Liens consisting of encumbrances in the nature of zoning
restrictions, easements, rights and restrictions of record on
the use of real property on the date of the acquisition
thereof and statutory Liens of landlords and lessors which in
any case do not Materially detract from the value of such real
property or impair the use thereof;
o any Lien in favor of the United States of America or any
department or agency thereof, or in favor of any state
government or political subdivision thereof, or in favor of a
prime contractor under a government contract of the United
States, or of any state government or any political
subdivision thereof, and, in each case, resulting from
acceptance of partial, progress, advance or other payments in
the ordinary course of business under government contracts of
the United States, or of any state government or any political
subdivision thereof, or subcontracts thereunder;
o any Lien existing on the date hereof and disclosed on the
consolidated Financial Reports of Dollar, and Liens incurred
in connection with the refinancing of the Indebtedness related
thereto, provided that the principal amount of such
Indebtedness is not increased in connection with such
refinancing;
o statutory Liens arising under ERISA created in the ordinary
course of business for amounts not yet due and as to which
adequate reserves have been established in accordance with
GAAP; and
o Liens not otherwise permitted above securing Indebtedness in
an aggregate cumulative amount of $5,000,000 or less.
(o) Merger and Sale of Assets. Not, without the prior written consent
of the Required Liquidity Banks, merge or consolidate with any
other corporation or sell, lease or transfer or otherwise dispose
of all or, during any twelve-month period, a Material part of its
Property to any Person, nor permit any Consolidated Company to take
any of the above actions; provided that notwithstanding any of the
foregoing limitations, if no Potential Event of Default or Event of
Default shall then exist or immediately thereafter will exist,
Consolidated Companies may take the following actions:
o Any Consolidated Company may merge with (i) Dollar (provided
that Dollar shall be the continuing or surviving corporation)
or (ii) any one or more other Subsidiaries provided that
either the continuing or surviving corporation shall remain a
Consolidated Company;
o Any Consolidated Company may sell, lease, transfer or
otherwise dispose of any of its assets to (i) Dollar or (ii)
any other Consolidated Company;
o Dollar may sell for fair value Scottsville, Kentucky office
buildings (exclusive of its Scottsville, Kentucky distribution
center); (iv) Dollar may enter into any sale and leaseback
transaction that does not violate the provisions of Section
5.1(u); and (v) Any Consolidated Company may sell inventory in
the ordinary course of its business.
(p) Transactions with Affiliates. Not, and will not permit any
Consolidated Company to, enter into or be a party to any
transaction or arrangement with any Affiliate (including, without
limitation, the purchase from, sale to or exchange of property
with, or the rendering of any service by or for, any Affiliates),
except in the ordinary course of and pursuant to the reasonable
requirements of such Consolidated Company's business and upon fair
and reasonable terms no less favorable to such Consolidated Company
than such party would obtain in a comparable arm's-length
transaction with a Person other than an Affiliate.
(q) Nature of Business. Not, and will not permit any Consolidated
Company to, engage in any business if, as a result, the general
nature of the business, taken on a consolidated basis, which would
then be engaged in by any Consolidated Company would be
fundamentally changed from the general nature of the business
engaged in by the Consolidated Companies on the date of this Master
Agreement.
(r) Regulations T, U and X. Not, nor permit any Consolidated Company to
take any action that would result in any non-compliance of the
Fundings made hereunder with Regulations T, U and X of the Board of
Governors of the Federal Reserve System.
(s) ERISA Compliance. Not, and will not permit any Consolidated Company
to, incur any Material "accumulated funding deficiency" within the
meaning of Section 302(a)(2) of ERISA, or any Material liability
under Section 4062 of ERISA to the PBGC established thereunder in
connection with any Plan.
(t) Investments, Loans, and Advances. Not, and will not permit any
Consolidated Company to, make or permit to remain outstanding any
loans or advances to or investments in any Person, except that,
subject to all other provisions of this Section 5.1(t), the
foregoing restriction shall not apply to:
o investments in direct obligations of the United States of
America or any agency thereof having maturities of less than
one year;
o investments in commercial paper maturing within one year from
the date of creation thereof of the highest credit rating of a
Rating Agency (or, in the case of Standard & Poor's, one of
the two highest credit ratings);
o investments in bankers' acceptances and certificates of
deposit having maturities of less than one year issued by
commercial banks in the United States of America having
capital and surplus in excess of $50,000,000;
o the endorsement of negotiable or similar instruments in the
ordinary course of business;
o investments in stock of any of the Consolidated Companies;
o investments in stock or assets, or any combination thereof, of
any Subsidiary created or acquired after the Initial Closing
Date;
o investments received in settlement of debt created in the
ordinary course of business;
o advances to officers and employees of Dollar made in the
ordinary course of business and not in excess of amounts
customarily and historically loaned to such officers and
employees not to exceed $5,000,000 in the aggregate;
o repurchase obligations with a term of not more than one year
for underlying securities of the types described in clauses
(i) and (iii) above entered into with a counterparty whose
short-term securities are of the highest credit rating of a
Rating Agency (or, in the case of Standard & Poor's, one of
the two highest credit ratings); and
o freely redeemable shares in money market funds which invest
solely in securities of the types described in clauses (i),
(ii), (iii) and (ix) and rated in the highest rating category
by a Rating Agency (or, in the case of Standard & Poor's, one
of the two highest rating categories).
(u) Sales and Leasebacks. Not, and will not permit any Consolidated
Company to, enter into one or more arrangements or transactions,
directly or indirectly, in any Fiscal Year, with any Person by
which any Consolidated Company shall sell or transfer any Property
and by which any Consolidated Company shall then or thereafter rent
or lease as lessee such Property or any part thereof or other
Property that such Consolidated Company intends to use for
substantially the same purpose or purposes as the Property sold or
transferred if the aggregate fair market value of all Property sold
or transferred in sale and leaseback transactions in any Fiscal
Year exceeds an amount equal to ten percent (10%) of Dollar's
consolidated total assets calculated in accordance with GAAP as
measured at Dollar's most recently concluded Fiscal Year and as
reported on its most recent Form 10-K (filed with the Securities
and Exchange Commission pursuant to ss. 13 of the Exchange Act) for
each Fiscal Year. The calculation of Dollar's consolidated assets
shall be recalculated on each occasion that Dollar delivers to the
Agent its most recently filed Form 10-K.
(v) Guaranties. Not, and will not permit any Consolidated Company to,
enter into any Guaranty, except that, subject to all other
provisions of this Section 5, the foregoing restriction shall not
apply to:
o Subsidiary Guaranties;
o the execution by Dollar of a Guaranty for the Synthetic Lease;
o Guaranties executed by one Consolidated Company in favor of or
to another Consolidated Company for the obligations of another
Consolidated Company;
o endorsements of instruments for deposit or collection in the
ordinary course of business; and
o such other Guaranties that do not cause a breach or violation
of the Consolidated Funded Debt to Total Capitalization Ratio.
(w) Acquisitions. Not permit any Consolidated Company to make
Acquisitions for a purchase price in excess of $50,000,000 in the
aggregate in any twelve (12) month period. For the purpose hereof,
the purchase price shall be determined by the sum of: (A) all cash
paid, plus (B) the principal amount of any promissory notes given,
plus (C) the value of any stock given, and (D) the value of any
other Property given or transferred in respect of such Acquisition.
(x) Year 2000 Issues. Take, and cause its Subsidiaries to take, all
actions reasonably necessary to assure that the Year 2000 Issues,
as such Year 2000 Issues pertain to the computer programs and
systems of the Consolidated Companies, will not have a Materially
Adverse Effect. Dollar and the other Consolidated Companies will
use their reasonable efforts to assure that its third-party
customers, suppliers and vendors develop and implement programs to
remediate in all material respects all Year 2000 Issues reasonably
anticipated by Dollar or the other Consolidated Companies to have a
Materially Adverse Effect. Upon request by the Agent or any
Liquidity Bank, Dollar will provide the Agent and the Liquidity
Banks a written description of its Year 2000 program, including
updates and progress reports. Dollar will advise Agent and the
Liquidity Banks promptly of any reasonably anticipated Materially
Adverse Effect as a result of Year 2000 Issues.
SECTION 5.2 Further Assurances.
Upon the written request of the Lessor or the Agent, each Lessee, at
its own cost and expense, will cause all financing statements (including
precautionary financing statements), fixture filings and other similar
documents, to be recorded or filed at such places and times in such manner, as
may be necessary to preserve, protect and perfect the interest of the Lessor,
the Agent, the Liquidity Banks and the Lender in the related Leased Property as
contemplated by the Operative Documents.
SECTION 5.3 Additional Required Appraisals.
If, as a result of any change in Applicable Law after the date hereof,
an appraisal of all or any of the Leased Property is required during the Lease
Term under Applicable Law with respect to any Funding Party's interest therein,
such Funding Party's Funded Amount with respect thereto or the Operative
Documents, then the related Lessee or Lessees shall pay the reasonable cost of
such appraisal.
SECTION 5.4 Lessor's Covenants.
The Lessor covenants and agrees that, unless the Agent, the Lender and
the Required Liquidity Banks shall have otherwise consented in writing:
(a) it shall not amend its Partnership Agreement, except to admit
limited partners in connection with lease transactions similar
to the Transaction;
(b) it shall not incur any indebtedness or other monetary
obligation or liability, other than (i) non-recourse
indebtedness incurred in connection with the Transaction or
similar transactions and (ii) operating expenses incurred in
the ordinary course of business that are not delinquent;
(c) the proceeds of the Loans received from the Lender will be
used by the Lessor solely to acquire the Leased Property and
to pay the Construction Agent for certain closing and
transaction costs associated therewith and for the costs of
Construction. No portion of the proceeds of the Loans will be
used by the Lessor (i) in connection with, whether directly or
indirectly, any tender offer for, or other acquisition of,
stock of any corporation with a view towards obtaining control
of such other corporation, (ii) directly or indirectly, for
the purpose, whether immediate, incidental or ultimate, of
purchasing or carrying any Margin Stock, or (iii) for any
purpose in violation of any Applicable Law;
(d) it shall not engage in any business or activity, or invest in
any Person, except for activities similar to its activities
conducted on the date hereof, the Transactions and lease
transactions similar to the Transactions;
(e) it will maintain tangible net worth in an amount no less than
the sum of (i) $100,000 plus (ii) 3% of its total assets
(calculated assuming no reduction in the value of any leased
property from its original cost to the Lessor);
(f) it will deliver to the Agent, as soon as available and in any
event within 90 days after the end of each fiscal year, a
balance sheet of the Lessor as of the end of such fiscal year
and the related statements of income, partners' capital and
cash flows for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal year,
together with copies of its tax returns, all certified by an
officer of the General Partner (and if the Lessor ever
prepares audited financial statements, it shall deliver copies
thereto the Agent);
(g) it will permit the Agent and its representatives to examine,
and make copies from, the Lessor's books and records, and to
visit the offices and properties of the Lessor for the purpose
of examining such materials, and to discuss the Lessor's
performance hereunder with any of its, or its General
Partner's, officers and employees;
(h) it shall not consent to or suffer or permit any Lien against
the Leased Property, other than as expressly contemplated
pursuant to the Operative Documents;
(i) it shall not consent to or suffer or permit the creation of
any easement or other restriction against the Leased Property
other than as permitted pursuant to Article VI of the Lease;
and
(j) it shall promptly discharge each Lessor Lien and shall
indemnify the Lender and the related Lessee for any diminution
in value of any Leased Property resulting from such Lessor
Liens.
SECTION 6 TRANSFERS BY LESSOR AND LENDER
SECTION 6.1 Lessor Transfers.
The Lessor shall not assign, convey or otherwise transfer all or any
portion of its right, title or interest in, to or under any Leased Property or
any of the Operative Documents without the prior written consent of the
Liquidity Banks, the Administrator and Dollar. Any proposed transferee of the
Lessor shall make the representation set forth in Section 4.2(b) to the other
parties hereto.
SECTION 6.2 Lender Transfers.
The Lender shall not assign, convey or otherwise transfer all or any
portion of its Loans, the Notes or its interests, rights and obligations under
this Master Agreement and the Loan Agreement without the prior written consent
of the Administrator and Dollar, except to (i) the Liquidity Banks, or the
Liquidity Agent on behalf of the Liquidity Banks, (ii) any other Program Support
Provider or (iii) any other commercial paper conduit administered by the
Administrator or an Affiliate thereof. If all of the Loans have been funded
pursuant to the Liquidity Agreement, at the request of the Administrator,
Dollar, the other Lessees, the Lessor and the Liquidity Banks hereby agree to
enter into such amendments to this Master Agreement and the other Operative
Documents as shall be necessary, in the reasonable judgment of the
Administrator, to evidence an assignment by the Lender, and the assumption by
the Liquidity Banks, of all rights and obligations (including the Loans and the
Lender's Commitment) of the Lender under the Operative Documents to the
Liquidity Banks (in which case, the Lender shall be released from all such
obligations).
SECTION 7 INDEMNIFICATION
SECTION 7.1 General Indemnification.
Each Lessee, jointly and severally, agrees, whether or not any of the
transactions contemplated hereby shall be consummated, to assume liability for,
and to indemnify, protect, defend, save and hold harmless each Indemnitee, on an
After-Tax Basis, from and against, any and all Claims that may be imposed on,
incurred by or asserted, or threatened to be asserted, against such Indemnitee,
whether or not such Indemnitee shall also be indemnified as to any such Claim by
any other Person and whether or not such Claim arises or accrues prior to any
Closing Date or after the Lease Termination Date, in any way relating to or
arising out of:
(a) any of the Operative Documents or any of the transactions
contemplated thereby, and any amendment, modification or
waiver in respect thereof; or
(b) any Land, any Building or any part thereof or interest
therein, including any Ground Lease and any IDB Documentation;
(c) the purchase, design, construction, preparation, installation,
inspection, delivery, non-delivery, acceptance, rejection,
ownership, management, possession, operation, rental, lease,
sublease, repossession, maintenance, repair, alteration,
modification, addition, substitution, storage, transfer of
title, redelivery, use, financing, refinancing, disposition,
operation, condition, sale (including, without limitation, any
sale pursuant to the Lease), return or other disposition of
all or any part of any interest in any Leased Property or the
imposition of any Lien, other than a Lessor Lien (or incurring
of any liability to refund or pay over any amount as a result
of any Lien, other than a Lessor Lien) thereon, including,
without limitation: (1) Claims or penalties arising from any
violation or alleged violation of law or in tort (strict
liability or otherwise), (2) latent or other defects, whether
or not discoverable, (3) any Claim based upon a violation or
alleged violation of the terms of any restriction, easement,
condition or covenant or other matter affecting title to any
Leased Property or any part thereof, (4) the making of any
Alterations in violation of any standards imposed by any
insurance policies required to be maintained by any Lessee
pursuant to the Lease which are in effect at any time with
respect to any Leased Property or any part thereof, (5) any
Claim for patent, trademark or copyright infringement, (6)
Claims arising from any public improvements with respect to
any Leased Property resulting in any charge or special
assessments being levied against any Leased Property or any
Claim for utility "tap-in" fees, and (7) Claims for personal
injury or real or personal property damage occurring, or
allegedly occurring, on any Land, Building or Leased Property;
(d) the offer, issuance, sale or delivery of the Notes;
(e) the breach or alleged breach by any Lessee of any
representation, warranty or covenant made by it or deemed made
by it in any Operative Document or any certificate required to
be delivered by any Operative Document;
(f) the retaining or employment of any broker, finder or financial
advisor by any Lessee to act on its behalf in connection with
this Master Agreement, or the incurring of any fees or
commissions to which the Lessor, the Agent, the Lender, the
Administrator or any Liquidity Bank might be subjected by
virtue of their entering into the transactions contemplated by
this Master Agreement (other than fees or commissions due to
any broker, finder or financial advisor retained by the
Lessor, the Agent, the Lender, the Administrator or any
Liquidity Bank);
(g) the existence of any Lien on or with respect to any Leased
Property, the Construction, any Basic Rent or Supplemental
Rent, title thereto, or any interest therein, including any
Liens which arise out of the possession, use, occupancy,
construction, repair or rebuilding of any Leased Property or
by reason of labor or materials furnished or claimed to have
been furnished to the Construction Agent, any Lessee, or any
of its contractors or agents or by reason of the financing of
any personalty or equipment purchased or leased by any Lessee
or Alterations constructed by any Lessee, except in all cases
the Liens listed as items (a) and (b) in the definition of
Permitted Liens;
(h) the transactions contemplated hereby or by any other Operative
Document, in respect of the application of Parts 4 and 5 of
Subtitle B of Title I of ERISA and any prohibited transaction
described in Section 4975(c) of the Code; or
(i) any act or omission by any Lessee under any Purchase Agreement
or any other Operative Document, and any breach of any
requirement, condition, restriction or limitation in any Deed,
Purchase Agreement, IDB Documentation or Ground Lease;
provided, however, the Lessees shall not be required to
indemnify any Indemnitee under this Section 7.1 for any of the
following: (1) any Claim to the extent that such Claim results
from the willful misconduct, gross negligence or
misrepresentation of such Indemnitee, (2) any Claim resulting
from Lessor Liens which the Lessor Indemnitee Group is
responsible for discharging under the Operative Documents, or
(3) any Claim to the extent attributable to events occurring
after the return of all of the Leased Properties to the Lessor
in accordance with the Leases; and, provided, further, that
with respect to each Construction Land Interest, each Lessee's
indemnity obligations with respect to such Leased Property
shall be governed by Section 3.3 of the Construction Agency
Agreement during the Construction Term therefor. It is
expressly understood and agreed that the indemnity provided
for herein shall survive the expiration or termination of, and
shall be separate and independent from any other remedy under
this Master Agreement, the Lease or any other Operative
Document.
SECTION 7.2 Environmental Indemnity.
In addition to and without limitation of Section 7.1 or Section 3.3 of
the Construction Agency Agreement, each Lessee, jointly and severally, agrees to
indemnify, hold harmless and defend each Indemnitee, on an After-Tax Basis, from
and against any and all claims (including without limitation third party claims
for personal injury or real or personal property damage), losses (including but
not limited to any loss of value of any Leased Property), damages, liabilities,
fines, penalties, charges, suits, settlements, demands, administrative and
judicial proceedings (including informal proceedings) and orders, judgments,
remedial action, requirements, enforcement actions of any kind, and all
reasonable costs and expenses actually incurred in connection therewith
(including, but not limited to, reasonable attorneys' and/or paralegals' fees
and expenses), including, but not limited to, all costs incurred in connection
with any investigation or monitoring of site conditions or any clean-up,
remedial, removal or restoration work by any federal, state or local government
agency, arising directly or indirectly, in whole or in part, out of
(a) the presence on or under any Land of any Hazardous Materials,
or any releases or discharges of any Hazardous Materials on,
under, from or onto any Land,
(b) any activity, including, without limitation, construction,
carried on or undertaken on or off any Land, and whether by a
Lessee or any predecessor in title or any employees, agents,
contractors or subcontractors of any Lessee or any predecessor
in title, or any other Person, in connection with the
handling, treatment, removal, storage, decontamination,
clean-up, transport or disposal of any Hazardous Materials
that at any time are located or present on or under or that at
any time migrate, flow, percolate, diffuse or in any way move
onto or under any Land,
(c) loss of or damage to any property or the environment
(including, without limitation, clean-up costs, response
costs, remediation and removal costs, cost of corrective
action, costs of financial assurance, fines and penalties and
natural resource damages), or death or injury to any Person,
and all expenses associated with the protection of wildlife,
aquatic species, vegetation, flora and fauna, and any
mitigative action required by or under Environmental Laws, in
each case to the extent related to any Leased Property,
(d) any claim concerning any Leased Property's lack of compliance
with Environmental Laws, or any act or omission causing an
environmental condition on or with respect to any Leased
Property that requires remediation or would allow any
governmental agency to record a Lien or encumbrance on the
land records, or
(e) any residual contamination on or under any Land, or affecting
any natural resources on any Land, and to any contamination of
any property or natural resources arising in connection with
the generation, use, handling, storage, transport or disposal
of any such Hazardous Materials on or from any Leased
Property; in each case irrespective of whether any of such
activities were or will be undertaken in accordance with
applicable laws, regulations, codes and ordinances; in any
case with respect to the matters described in the foregoing
clauses (i) through (v) that arise or occur (w) prior to or
during the Lease Term, (x) at any time during which any Lessee
or any Affiliate thereof owns any interest in or otherwise
occupies or possesses any Leased Property or any portion
thereof, or (y) during any period after and during the
continuance of any Event of Default; provided, however, the
Lessees shall not be required to indemnify any Indemnitee
under this Section 7.2 for any Claim to the extent that such
Claim results from the willful misconduct or gross negligence
of such Indemnitee. It is expressly understood and agreed that
the indemnity provided for herein shall survive the expiration
or termination of and shall be separate and independent from
any other remedy under this Master Agreement, the Lease or any
other Operative Document.
SECTION 7.3 Proceedings in Respect of Claims.
With respect to any amount that a Lessee is requested by an Indemnitee
to pay by reason of Section 7.1 or 7.2, such Indemnitee shall, if so requested
by a Lessee and prior to any payment, submit such additional information to such
Lessee as such Lessee may reasonably request and which is in the possession of,
or under the control of, such Indemnitee to substantiate properly the requested
payment. In case any action, suit or proceeding shall be brought against any
Indemnitee, such Indemnitee promptly shall notify Dollar of the commencement
thereof (provided that the failure of such Indemnitee to promptly notify Dollar
shall not affect any Lessee's obligation to indemnify hereunder except to the
extent that such Lessee's ability to contest is Materially prejudiced by such
failure), and any Lessee shall be entitled, at its expense, to participate in,
and, to the extent that such Lessee desires to, assume and control the defense
thereof with counsel reasonably satisfactory to such Indemnitee; provided,
however, that such Indemnitee may pursue a motion to dismiss such Indemnitee
from such action, suit or proceeding with counsel of such Indemnitee's choice at
the Lessees' expense; and provided further that a Lessee may assume and control
the defense of such proceeding only if such Lessee shall have acknowledged in
writing its obligations to fully indemnify such Indemnitee in respect of such
action, suit or proceeding, such Lessee shall pay all reasonable costs and
expenses related to such action, suit or proceeding as and when incurred and
such Lessee shall keep such Indemnitee fully apprised of the status of such
action suit or proceeding and shall provide such Indemnitee with all information
with respect to such action suit or proceeding as such Indemnitee shall
reasonably request; and, provided further, that no Lessee shall be entitled to
assume and control the defense of any such action, suit or proceeding if and to
the extent that, (A) in the reasonable opinion of such Indemnitee, (x) such
action, suit or proceeding involves any possibility of imposition of criminal
liability or any Material risk of Material civil liability on such Indemnitee or
(y) such action, suit or proceeding will involve a Material risk of the sale,
forfeiture or loss of, or the creation of any Lien (other than a Permitted Lien)
on any Leased Property or any part thereof unless a Lessee shall have posted a
bond or other security satisfactory to the relevant Indemnitees in respect to
such risk or (z) the control of such action, suit or proceeding would involve an
actual or potential conflict of interest, (B) such proceeding involves Claims
not fully indemnified by the Lessees which the Lessees and the Indemnitee have
been unable to sever from the indemnified claim(s), or (C) an Event of Default
has occurred and is continuing. The Indemnitee may participate in a reasonable
manner at its own expense and with its own counsel in any proceeding conducted
by a Lessee in accordance with the foregoing.
If a Lessee fails to fulfill the conditions to such Lessee's assuming
the defense of any claim after receiving notice thereof on or prior to the date
that is 15 days prior to the date that an answer or response is required, the
Indemnitee may undertake such defense, at the Lessees' expense. No Lessee shall
enter into any settlement or other compromise with respect to any Claim in
excess of $1,000,000 which is entitled to be indemnified under Section 7.1 or
7.2 without the prior written consent of the related Indemnitee, which consent
shall not be unreasonably withheld. Unless an Event of Default shall have
occurred and be continuing, no Indemnitee shall enter into any settlement or
other compromise with respect to any claim which is entitled to be indemnified
under Section 7.1 or 7.2 without the prior written consent of Dollar, which
consent shall not be unreasonably withheld, unless such Indemnitee waives its
right to be indemnified under Section 7.1 or 7.2 with respect to such Claim.
Upon payment in full of any Claim by a Lessee pursuant to Section 7.1
or 7.2 to or on behalf of an Indemnitee, such Lessee, without any further
action, shall be subrogated to any and all claims that such Indemnitee may have
relating thereto (other than claims in respect of insurance policies maintained
by such Indemnitee at its own expense), and such Indemnitee shall execute such
instruments of assignment and conveyance, evidence of claims and payment and
such other documents, instruments and agreements as may be reasonably necessary
to preserve any such claims and otherwise cooperate with such Lessee and give
such further assurances as are reasonably necessary or advisable to enable such
Lessee vigorously to pursue such claims.
Any amount payable to an Indemnitee pursuant to Section 7.1 or 7.2
shall be paid to such Indemnitee promptly upon, but in no event later than 30
days after, receipt of a written demand therefor from such Indemnitee,
accompanied by a written statement describing in reasonable detail the basis for
such indemnity and the computation of the amount so payable.
If for any reason the indemnification provided for in Section 7.1 or
7.2 is unavailable to an Indemnitee or is insufficient to hold an Indemnitee
harmless, then each Lessee, jointly and severally, agrees to contribute to the
amount paid or payable by such Indemnitee as a result of such loss, claim,
damage or liability in such proportion as is appropriate to reflect not only the
relative benefits received by such Indemnitee on the one hand and by the Lessees
on the other hand but also the relative fault of such Indemnitee as well as any
other relevant equitable considerations. It is expressly understood and agreed
that the right to contribution provided for herein shall survive the expiration
or termination of and shall be separate and independent from any other remedy
under this Master Agreement, the Lease or any other Operative Document.
SECTION 7.4 General Tax Indemnity.
(a) Tax Indemnity. Except as otherwise provided in this Section 7.4,
each Lessee, jointly and severally, shall pay on an After-Tax
Basis, and on written demand shall indemnify and hold each Tax
Indemnitee harmless from and against, any and all fees (including,
without limitation, documentation, recording, license and
registration fees), taxes (including, without limitation, income,
gross receipts, sales, rental, use, turnover, value-added,
property, excise and stamp taxes), levies, imposts, duties,
charges, assessments or withholdings of any nature whatsoever,
together with any penalties, fines or interest thereon or additions
thereto (any of the foregoing being referred to herein as "Taxes"
and individually as a "Tax" (for the purposes of this Section 7.4,
the definition of "Taxes" includes amounts imposed on, incurred by,
or asserted against each Tax Indemnitee as the result of any
prohibited transaction, within the meaning of Section 406 or 407 of
ERISA or Section 4975(c) of the Code, arising out of the
transactions contemplated hereby or by any other Operative
Document)) imposed on or with respect to any Tax Indemnitee, any
Lessee, any Leased Property or any portion thereof or any Land, or
any sublessee or user thereof, by the United States or by any state
or local government or other taxing authority in the United States
in connection with or in any way relating to (i) the acquisition,
financing, mortgaging, construction, preparation, installation,
inspection, delivery, non-delivery, acceptance, rejection,
purchase, ownership, possession, rental, lease, sublease,
maintenance, repair, storage, transfer of title, redelivery, use,
operation, condition, sale, return or other application or
disposition of all or any part of any Leased Property or the
imposition of any Lien (or incurrence of any liability to refund or
pay over any amount as a result of any Lien) thereon, (ii) Basic
Rent or Supplemental Rent or the receipts or earnings arising from
or received with respect to any Leased Property or any part
thereof, or any interest therein or any applications or
dispositions thereof, (iii) any other amount paid or payable
pursuant to the Notes or any other Operative Documents, (iv) any
Leased Property, any Land or any part thereof or any interest
therein (including, without limitation, all assessments payable in
respect thereof, including, without limitation, all assessments
noted on the related Title Policy), (v) all or any of the Operative
Documents, any other documents contemplated thereby, any amendments
and supplements thereto, and (vi) otherwise with respect to or in
connection with the transactions contemplated by the Operative
Documents.
(b) Exclusions from General Tax Indemnity. Section 7.4(a) shall not
apply to:
o Taxes on, based on, or measured by or with respect to net
income of the Lessor, the Agent, the Liquidity Banks and the
Lender (including, without limitation, minimum Taxes, capital
gains Taxes, Taxes on or measured by items of tax preference
or alternative minimum Taxes) other than (A) any such Taxes
that are, or are in the nature of, sales, use, license, rental
or property Taxes, and (B) withholding Taxes imposed by the
United States or any state in which Leased Property is located
(i) on payments with respect to the Notes, to the extent
imposed by reason of a change in Applicable Law occurring
after the date on which the holder of such Note became the
holder of such Note or (ii) on Rent, to the extent the net
payment of Rent after deduction of such withholding Taxes
would be less than amounts currently payable with respect to
the Funded Amounts;
o Taxes on, based on, or in the nature of or measured by Taxes
on doing business, business privilege, franchise, capital,
capital stock, net worth, or mercantile license or similar
taxes other than (A) any increase in such Taxes imposed on
such Tax Indemnitee by any state in which Leased Property is
located, net of any decrease in such taxes realized by such
Tax Indemnitee, to the extent that such tax increase would not
have occurred if on each Funding Date the Lessor and the
Lender had advanced funds to the related Lessee or the
Construction Agent in the form of loans secured by the Leased
Property in an amount equal to the Funded Amounts funded on
such Funding Date, with debt service for such loans equal to
the Basic Rent payable on each Payment Date and a principal
balance at the maturity of such loans in a total amount equal
to the Funded Amounts at the end of the Lease Term, or (B) any
Taxes that are or are in the nature of sales, use, rental,
license or property Taxes relating to any Leased Property;
o Taxes that are based on, or measured by, the fees or other
compensation received by a Person acting as Agent (in its
individual capacities) or any Affiliate of any thereof for
acting as trustee under the Loan Agreement;
o Taxes that result from any act, event or omission, or are
attributable to any period of time, that occurs after the
earliest of (A) the expiration of the Lease Term with respect
to any Leased Property and, if such Leased Property is
required to be returned to the Lessor in accordance with the
Lease, such return and (B) the discharge in full of the
related Lessee's obligations to pay the Lease Balance, or any
amount determined by reference thereto, with respect to any
Leased Property and all other amounts due under the Lease,
unless such Taxes relate to acts, events or matters occurring
prior to the earliest of such times or are imposed on or with
respect to any payments due under the Operative Documents
after such expiration or discharge;
o Taxes imposed on a Tax Indemnitee that result from any
voluntary sale, assignment, transfer or other disposition or
bankruptcy by such Tax Indemnitee or any related Tax
Indemnitee of any interest in any Leased Property or any part
thereof, or any interest therein or any interest or obligation
arising under the Operative Documents, or from any sale,
assignment, transfer or other disposition of any interest in
such Tax Indemnitee or any related Tax Indemnitee, it being
understood that each of the following shall not be considered
a voluntary sale: (A) any substitution, replacement or removal
of any of the Leased Property by a Lessee, (B) any sale or
transfer resulting from the exercise by a Lessee of any
termination option, any purchase option or sale option, (C)
any sale or transfer while an Event of Default shall have
occurred and be continuing under the Lease, and (D) any sale
or transfer resulting from the Lessor's exercise of remedies
under the Lease;
o any Tax which is being contested in accordance with the
provisions of Section 7.4(c), during the pendency of such
contest;
o any Tax that is imposed on a Tax Indemnitee as a result of
such Tax Indemnitee's gross negligence or willful misconduct
(other than gross negligence or willful misconduct imputed to
such Tax Indemnitee solely by reason of its interest in any
Leased Property);
o any Tax that results from a Tax Indemnitee engaging, with
respect to any Leased Property, in transactions other than
those permitted by the Operative Documents;
o to the extent any interest, penalties or additions to tax
result in whole or in part from the failure of a Tax
Indemnitee to file a return or pay a Tax that it is required
to file or pay in a proper and timely manner, unless such
failure (A) results from the transactions contemplated by the
Operative Documents in circumstances where a Lessee did not
give timely notice to such Tax Indemnitee (and such Tax
Indemnitee otherwise had no actual knowledge) of such filing
or payment requirement that would have permitted a proper and
timely filing of such return or payment of such Tax, as the
case may be, or (B) results from the failure of a Lessee to
supply information necessary for the proper and timely filing
of such return or payment of such Tax, as the case may be,
that was not in the possession of such Tax Indemnitee; and
o any Tax that results from the breach by the Lessor of its
representation and warranty made in Section 4.2(b) or the
breach of the Lender of its representation and warranty made
in Section 4.3(b).
(c) Contests. If any claim shall be made against any Tax Indemnitee or
if any proceeding shall be commenced against any Tax Indemnitee
(including a written notice of such proceeding) for any Taxes as to
which the Lessee may have an indemnity obligation pursuant to
Section 7.4, or if any Tax Indemnitee shall determine that any
Taxes as to which the Lessees may have an indemnity obligation
pursuant to Section 7.4 may be payable, such Tax Indemnitee shall
promptly notify Dollar. A Lessee shall be entitled, at its expense,
to participate in, and, to the extent that such Lessee desires to,
assume and control the defense thereof; provided, however, that
such Lessee shall have acknowledged in writing its obligation to
fully indemnify such Tax Indemnitee in respect of such action if
requested to do so by such Lessee, suit or proceeding if the
contest is unsuccessful; and, provided further, that no Lessee
shall be entitled to assume and control the defense of any such
action, suit or proceeding (but the Tax Indemnitee shall then
contest, at the sole cost and expense of the Lessee, on behalf of
the related Lessee with representatives reasonably satisfactory to
such Lessee) if and to the extent that, (A) in the reasonable
opinion of such Tax Indemnitee, such action, suit or proceeding (x)
involves any meaningful risk of imposition of criminal liability or
any Material risk of Material civil liability on such Tax
Indemnitee or (y) will involve a Material risk of the sale,
forfeiture or loss of, or the creation of any Lien (other than a
Permitted Lien) on any Leased Property or any part thereof unless
the Lessees shall have posted a bond or other security satisfactory
to the relevant Tax Indemnitees in respect to such risk, (B) such
proceeding involves Claims not fully indemnified by the Lessees
which the Lessees and the Tax Indemnitee have been unable to sever
from the indemnified claim(s), (C) an Event of Default has occurred
and is continuing, (D) such action, suit or proceeding involves
matters which extend beyond or are unrelated to the Transaction and
if determined adversely could be Materially detrimental to the
interests of such Tax Indemnitee notwithstanding indemnification by
the Lessees or (E) such action, suit or proceeding involves the
federal or any state income tax liability of the Tax Indemnitee.
With respect to any contests controlled by a Tax Indemnitee, (i) if
such contest relates to the federal or any state income tax
liability of such Tax Indemnitee, such Tax Indemnitee shall be
required to conduct such contest only if the Lessees shall have
provided to such Tax Indemnitee an opinion of independent tax
counsel selected by the Tax Indemnitee and reasonably satisfactory
to the Lessees stating that a reasonable basis exists to contest
such claim or (ii) in the case of an appeal of an adverse
determination of any contest relating to any Taxes, an opinion of
such counsel to the effect that such appeal is more likely than not
to be successful, provided, however, such Tax Indemnitee shall in
no event be required to appeal an adverse determination to the
United States Supreme Court. The Tax Indemnitee may participate in
a reasonable manner at its own expense and with its own counsel in
any proceeding conducted by a Lessee in accordance with the
foregoing.
Each Tax Indemnitee shall at the Lessees' expense supply the
related Lessee with such information and documents in such Tax
Indemnitee's possession reasonably requested by such Lessee as are
necessary or advisable for such Lessee to participate in any
action, suit or proceeding to the extent permitted by this Section
7.4. Unless an Event of Default shall have occurred and be
continuing, no Tax Indemnitee shall enter into any settlement or
other compromise with respect to any Claim which is entitled to be
indemnified under this Section 7.4 without the prior written
consent of Dollar, which consent shall not be unreasonably
withheld, unless such Tax Indemnitee waives its right to be
indemnified under this Section 7.4 with respect to such Claim.
Notwithstanding anything contained herein to the contrary, (a) a
Tax Indemnitee will not be required to contest (and no Lessee shall
be permitted to contest) a claim with respect to the imposition of
any Tax if such Tax Indemnitee shall waive its right to
indemnification under this Section 7.4 with respect to such claim
(and any related claim with respect to other taxable years the
contest of which is precluded as a result of such waiver) and (b)
no Tax Indemnitee shall be required to contest any claim if the
subject matter thereof shall be of a continuing nature and shall
have previously been decided adversely, unless there has been a
change in law which in the opinion of Tax Indemnitee's counsel
creates substantial authority for the success of such contest. Each
Tax Indemnitee and each Lessee shall consult in good faith with
each other regarding the conduct of such contest controlled by
either.
(d) Reimbursement for Tax Savings. If (x) a Tax Indemnitee shall obtain
a credit or refund of any Taxes paid by a Lessee pursuant to this
Section 7.4 or (y) by reason of the incurrence or imposition of any
Tax for which a Tax Indemnitee is indemnified hereunder or any
payment made to or for the account of such Tax Indemnitee by a
Lessee pursuant to this Section 7.4, such Tax Indemnitee at any
time realizes a reduction in any Taxes for which the Lessees are
not required to indemnify such Tax Indemnitee pursuant to this
Section 7.4, which reduction in Taxes was not taken into account in
computing such payment by a Lessee to or for the account of such
Tax Indemnitee, then such Tax Indemnitee shall promptly pay to such
Lessee (xx) the amount of such credit or refund, together with the
amount of any interest received by such Tax Indemnitee on account
of such credit or refund or (yy) an amount equal to such reduction
in Taxes, as the case may be; provided that no such payment shall
be made so long as an Event of Default shall have occurred and be
continuing and, provided, further, that the amount payable to a
Lessee by any Tax Indemnitee pursuant to this Section 7.4(d) shall
not at any time exceed the aggregate amount of all indemnity
payments made by such Lessee under this Section 7.4 to such Tax
Indemnitee with respect to the Taxes which gave rise to the credit
or refund or with respect to the Tax which gave rise to the
reduction in Taxes less the amount of all prior payments made to
such Lessee by such Tax Indemnitee under this Section 7.4(d). Each
Tax Indemnitee agrees to act in good faith to claim such refunds
and other available Tax benefits, and take such other actions as
may be reasonable to minimize any payment due from the Lessees
pursuant to this Section 7.4. The disallowance or reduction of any
credit, refund or other tax savings with respect to which a Tax
Indemnitee has made a payment to a Lessee under this Section 7.4(d)
shall be treated as a Tax for which the Lessees are obligated to
indemnify such Tax Indemnitee hereunder without regard to Section
7.4(b) hereof.
(e) Payments. Any Tax indemnifiable under this Section 7.4 shall be
paid by the Lessees directly when due to the applicable taxing
authority if direct payment is practicable and permitted. If direct
payment to the applicable taxing authority is not permitted or is
otherwise not made, any amount payable to a Tax Indemnitee pursuant
to Section 7.4 shall be paid within thirty (30) days after receipt
of a written demand therefor from such Tax Indemnitee accompanied
by a written statement describing in reasonable detail the amount
so payable, but not before the date that the relevant Taxes are
due. Any payments made pursuant to Section 7.4 shall be made to the
Tax Indemnitee entitled thereto or a Lessee, as the case may be, in
immediately available funds at such bank or to such account as
specified by the payee in written directions to the payor, or, if
no such direction shall have been given, by check of the payor
payable to the order of the payee by certified mail, postage
prepaid at its address as set forth in this Master Agreement. Upon
the request of any Tax Indemnitee with respect to a Tax that a
Lessee is required to pay, such Lessee shall furnish to such Tax
Indemnitee the original or a certified copy of a receipt for the
Lessee's payment of such Tax or such other evidence of payment as
is reasonably acceptable to such Tax Indemnitee.
(f) Reports. If any Lessee knows of any report, return or statement
required to be filed with respect to any Taxes that are subject to
indemnification under this Section 7.4, such Lessee shall, if such
Lessee is permitted by Applicable Law, timely file such report,
return or statement (and, to the extent permitted by law, show
ownership of the applicable Leased Property in such Lessee);
provided, however, that if such Lessee is not permitted by
Applicable Law or does not have access to the information required
to file any such report, return or statement, such Lessee will
promptly so notify the appropriate Tax Indemnitee, in which case
Tax Indemnitee will file such report. In any case in which the Tax
Indemnitee will file any such report, return or statement, a Lessee
shall, upon written request of such Tax Indemnitee, prepare such
report, return or statement for filing by such Tax Indemnitee or,
if such Tax Indemnitee so requests, provide such Tax Indemnitee
with such information as is reasonably available to such Lessee.
(g) Verification. At a Lessee's request, the amount of any indemnity
payment by the Lessees or any payment by a Tax Indemnitee to a
Lessee pursuant to this Section 7.4 shall be verified and certified
by an independent public accounting firm selected by Dollar and
reasonably acceptable to the Tax Indemnitee. Unless such
verification shall disclose an error in the Lessees' favor of 5% or
more of the related indemnity payment, the costs of such
verification shall be borne by the Lessees. In no event shall any
Lessee have the right to review the Tax Indemnitee's tax returns or
receive any other confidential information from the Tax Indemnitee
in connection with such verification. The Tax Indemnitee agrees to
cooperate with the independent public accounting firm performing
the verification and to supply such firm with all information
reasonably necessary to permit it to accomplish such verification,
provided that the information provided to such firm by such Tax
Indemnitee shall be for its confidential use. The parties agree
that the sole responsibility of the independent public accounting
firm shall be to verify the amount of a payment pursuant to this
Master Agreement and that matters of interpretation of this Master
Agreement are not within the scope of the independent accounting
firm's responsibilities.
SECTION 7.5 Increased Costs, etc.
(a) Taxes.
Except as otherwise specifically provided herein, all payments
under this Master Agreement and the other Operative Documents,
other than the payments specified in clause (ii)(c) below, shall be
made without defense, set-off, or counterclaim.
(a) All such payments shall be made free and clear of and without
deduction or withholding for any Taxes in respect of this
Master Agreement, the Notes or other Operative Documents, or
any payments of principal, interest, fees or other amounts
payable hereunder or thereunder (but excluding, except as
provided in paragraph (iii) hereof, in the case of each
Affected Party, taxes imposed on or measured by its net
income, and franchise taxes and branch profit taxes imposed on
it (A) by the jurisdiction under the laws of which such
Affected Party is organized or any political subdivision
thereof, and in the case of each Affected Party, taxes imposed
on or measured by its net income, and franchise taxes and
branch profit taxes imposed on it, by the jurisdiction of such
Affected Party's appropriate Lending Office or any political
subdivision thereof, and (B) by a jurisdiction in which any
payments are to be made by any Lessee under the Operative
Documents, other than the United States of America, or any
political subdivision thereof, and that would not have been
imposed but for the existence of a connection between such
Affected Party and the jurisdiction imposing such taxes (other
than a connection arising as a result of this Master Agreement
or the transactions contemplated by this Master Agreement),
except in the case of taxes described in this clause (B), to
the extent such taxes are imposed as a result of a change in
the law or regulations of any jurisdiction or any applicable
treaty or regulations or in the official interpretation of any
such law, treaty or regulations by any government authority
charged with the interpretation or administration thereof
after the date of this Master Agreement). If any such Taxes
are so levied or imposed, the Lessees, jointly and severally
agree (A) to pay the full amount of such Taxes, and such
additional amounts as may be necessary so that every net
payment of all amounts due hereunder and under the Notes, the
Lease and other Operative Documents, after withholding or
deduction for or on account of any such Taxes (including
additional sums payable under this Section 7.5(a)), will not
be less than the full amount provided for herein or therein
had no such deduction or withholding been required, (B) to
make such withholding or deduction and (C) to pay the full
amount deducted to the relevant authority in accordance with
applicable law. Dollar will furnish to the Agent, within 30
days after the date the payment of any Taxes is due pursuant
to applicable law, certified copies of tax receipts evidencing
such payment by a Lessee. The Lessees, jointly and severally,
will indemnify and hold harmless each Affected Party and
reimburse each Affected Party upon written request for the
amount of any such Taxes so levied or imposed and paid by such
Affected Party and any liability (including penalties,
interest and expenses) arising therefrom or with respect
thereto, whether or not such Taxes were correctly or illegally
asserted. A certificate as to the amount of such payment by
such Affected Party, absent manifest error, shall be final,
conclusive and binding for all purposes.
(b) Each Liquidity Bank that is organized under the laws of any
jurisdiction other than the United States of America or any
State thereof (including the District of Columbia) agrees to
furnish to Dollar and the Agent, prior to the time it becomes
a Liquidity Bank under the Liquidity Agreement, two copies of
either U.S. Internal Revenue Service Form 4224 or U.S.
Internal Revenue Service Form 1001 or any successor forms
thereto (wherein such Liquidity Bank claims entitlement to
complete exemption from U.S. Federal withholding tax on Rent
paid by the Lessees) and to provide to Dollar and the Agent a
new Form 4224 or Form 1001 or any successor forms thereto if
any previously delivered form is found to be incomplete or
incorrect in any Material respect or upon the obsolescence of
any previously delivered form; provided, however, that no
Liquidity Bank shall be required to furnish a form under this
paragraph (b) after the date that it becomes a Liquidity Bank
under the Liquidity Agreement if it is not entitled to claim
an exemption from withholding under applicable law.
(c) The Lessees, jointly and severally, shall also reimburse each
Affected Party, upon written request, for any Taxes imposed
(including, without limitation, Taxes imposed on the overall
net income of such Affected Party or its applicable Lending
Office pursuant to the laws of the jurisdiction in which the
principal executive office or the applicable Lending Office of
the Affected Party is located) as such Affected Party shall
determine are payable by Affected Party in respect of amounts
paid by or on behalf of a Lessee to or on behalf of such
Affected Party pursuant to this Section 7.5.
(d) In addition to the documents to be furnished pursuant to
Section 7.5(b), each Affected Party shall, promptly upon the
reasonable written request of Dollar to that effect, deliver
to Dollar such other accurate and complete forms or similar
documentation as such Affected Party is legally able to
provide and as may be required from time to time by any
applicable law, treaty, rule or regulation or any jurisdiction
in order to establish such Affected Party's tax status for
withholding purposes or as may otherwise be appropriate to
eliminate or minimize any Taxes on payments under this Master
Agreement or the Notes.
(e) No Lessee shall be required to pay any amounts pursuant to
Section 7.5(a) to any Liquidity Bank for the account of any
Lending Office of such Liquidity Bank in respect of any United
States withholding taxes payable hereunder (and the Lessees,
if required by law to do so, shall be entitled to withhold
such amounts and pays such amounts to the United States
Government) if the obligation to pay such additional amounts
would not have arisen but for a failure by such Liquidity Bank
to comply with its obligations under Section 7.5(b), and such
Liquidity Bank shall not be entitled to an exemption from
deduction or withholding of United Stated Federal income tax
in respect of the payment of such sum by the Lessees hereunder
for the account of such Lending Office for, in each case, any
reason other than a change in United States law or regulations
by any governmental authority charged with the interpretation
or administration thereof (whether or not having the force of
law) after the date such Liquidity Bank became a Liquidity
Bank under the Liquidity Agreement.
(f) Within sixty (60) days of the written request of Dollar, each
Affected Party shall execute and deliver such certificates,
forms or other documents, which can be reasonably furnished
consistent with the facts and which are reasonably necessary
to assist in applying for refunds of Taxes remitted hereunder.
(b) Interest Rate Not Ascertainable, etc. In the event that the Agent
shall have determined (which determination shall be made in good
faith and, absent manifest error, shall be final, conclusive and
binding upon all parties) that on any date for determining the
Adjusted LIBO Rate for any Rent Period, by reason of any changes
arising after the date of this Master Agreement affecting the
London interbank market, or the Agent's position in such market,
adequate and fair means do not exist for ascertaining the
applicable interest rate on the basis provided for in the
definition of Adjusted LIBO Rate, then, and in any such event, the
Agent shall forthwith give notice (by telephone confirmed in
writing) to Dollar and to the Liquidity Banks, of such
determination and a summary of the basis for such determination.
Until the Agent notifies Dollar that the circumstances giving rise
to the suspension described herein no longer exist, the portions of
the Fundings funded under the Liquidity Agreement, if any, shall
bear interest at the Base Rate.
(c) Illegality.
o In the event that any Liquidity Bank shall have determined
(which determination shall be made in good faith and, absent
manifest error, shall be final, conclusive and binding upon
all parties) at any time that the making or continuance of any
LIBOR Advance has become unlawful by compliance by such
Liquidity Bank in good faith with any applicable law,
governmental rule, regulation, guideline or order (whether or
not having the force of law and whether or not failure to
comply therewith would be unlawful), then, in any such event,
such Liquidity Bank shall give prompt notice (by telephone
confirmed in writing) to Dollar and to the Agent of such
determination and a summary of the basis for such
determination (which notice the Agent shall promptly transmit
to the other Liquidity Banks).
o Upon the giving of the notice to Dollar referred to in
subsection (i) above, (x) that portion of the Funded Amounts
funded under the Liquidity Agreement, if any, shall bear
interest at the Base Rate, and (y) if the affected LIBOR
Advance or Advances are then outstanding, such LIBOR Advances
shall immediately, or if subject to applicable law, no later
than the date permitted by applicable law, upon at least one
Business Day's written notice to the Agent and the affected
Liquidity Bank, be converted into a Base Rate Advance or
Advances, provided that if more than one Liquidity Bank is
affected at any time, then all affected Liquidity Banks must
be treated the same pursuant to this Section 7.5(c)(ii).
(d) Increased Costs.
If, by reason of (x) after the date hereof, the introduction
of or any change (including, without limitation, any change by
way of imposition or increase of reserve requirements) in or
in the interpretation of any law or regulation, or (y) the
compliance with any guideline or request from any central bank
or other governmental authority or quasi-governmental
authority exercising control over banks or financial
institutions generally (whether or not having the force of
law):
(a) any Affected Party (or its applicable Lending Office) shall be
subject to any tax, duty or other charge with respect to its
Advances, or its obligation to make such Advances, or its
obligations under any Program Support Agreement, or the basis
of taxation of payments to any Affected Party of the principal
of or interest on its Advances or its obligation to make
Advances or its obligations under any Program Support
Agreement, shall have changed (except for changes in the tax
on the overall net income of such Affected Party or its
applicable Lending Office imposed by the jurisdiction in which
such Affected Party's principal executive office or applicable
Lending Office is located); or
(b) any reserve (including, without limitation, any imposed by the
Board of Governors of the Federal Reserve System), special
deposit or similar requirement against assets of, deposits
with or for the account of, or credit extended by, any
Affected Party's applicable Lending Office shall be imposed or
deemed applicable or any other condition affecting its
Advances or its obligation to make Advances or its obligations
under any Program Support Agreement, shall be imposed on any
Affected Party or its applicable Lending Office or the London
interbank market;and as a result thereof there shall be any
increase in the cost to such Affected Party of agreeing to
make or making, funding or maintaining Advances (except to the
extent already included in the determination of the applicable
Adjusted LIBO Rate for LIBOR Advances) or its obligation to
make Advances, or its obligations under any Program Support
Agreement, or there shall be a reduction in the amount
received or receivable by such Affected Party or its
applicable Lending Office, then the Lessees, jointly and
severally, shall from time to time, upon written notice from
and demand by such Affected Party to Dollar (with a copy of
such notice and demand to the Agent), pay to the Agent for the
account of such Affected Party within ten (10) Business Days
after the date of such notice and demand, additional amounts
sufficient to indemnify such Affected Party against such
increased cost or reduction. A certificate as to the amount of
such increased cost or reduction, submitted to Dollar and the
Agent by such Affected Party in good faith and accompanied by
a statement prepared by such Affected Party describing in
reasonable detail the basis for and calculation of such
increased cost, shall, except for manifest error, be final
conclusive and binding for all purposes.
If any Affected Party shall advise the Agent that at any time,
because of the circumstances described in Section 7.5(c)(i) or any
other circumstances beyond such Affected Party's reasonable control
arising after the date of this Master Agreement affecting such
Affected Party or the London interbank market or such Affected
Party's position in such market, the Adjusted LIBO Rate as
determined by the Agent will not adequately and fairly reflect the
cost to such Affected Party of funding its LIBOR Advances then, and
in any such event:
(a) the Agent shall forthwith give notice (by telephone confirmed
in writing) to Dollar and to the other Liquidity Banks of such
advice; and
(b) that portion of the Funded Amounts funded pursuant to the
Liquidity Agreement, if any, shall be converted, continued
and/or made as Base Rate Advances.
(e) Lending Offices.
o Each Affected Party agrees that, if requested by Dollar, it
will use reasonable efforts (subject to overall policy
considerations of such Affected Party) to designate an
alternate Lending Office with respect to any of its LIBOR
Advances affected by the matters or circumstances described in
Section 7.5(a), (b), (c) or (d) to reduce the liability of the
Lessees or avoid the results provided thereunder, so long as
such designation is not disadvantageous to such Affected Party
as reasonably determined by such Affected Party, which
determination shall be conclusive and binding on all parties
hereto. Nothing in this Section 7.5(e) shall affect or
postpone any of the obligations of any Lessee or any right of
any Lessee provided hereunder or under the other Operative
Documents.
o If any Affected Party that is organized under the laws of any
jurisdiction other than the United States of America or any
State thereof (including the District of Columbia) issues a
public announcement with respect to the closing of its Lending
Offices in the United States such that any withholdings or
deductions and additional payments with respect to Taxes may
be required to be made by a Lessee thereafter pursuant to
Section 7.5(a)(ii), such Affected Party shall use reasonable
efforts to furnish Dollar notice thereof as soon as
practicable thereafter; provided, however, that no delay or
failure to furnish such notice shall in any event release or
discharge any Lessee from its obligations to such Affected
Party pursuant to Section 7.5(a) or otherwise result in any
liability of such Affected Party.
(f) Funding Losses. The Lessees, jointly and severally, shall
compensate each Affected Party, upon its written request to Dollar
(which request shall set forth the basis for requesting such
amounts in reasonable detail and which request shall be made in
good faith and, absent manifest error, shall be final, conclusive
and binding upon all of the parties hereto), for all actual losses,
expenses and liabilities (including, without limitation, any
interest paid by such Affected Party to lenders of funds borrowed
by it to make or carry its Advances to the extent not recovered by
such Affected Party in connection with the re-employment of such
funds but excluding loss of anticipated profits), which such
Affected Party may sustain: (i) if for any reason (other than a
default by such Affected Party) a funding of any Advances does not
occur on the date specified therefor in a Funding Request (whether
or not withdrawn), (ii) if any repayment (including mandatory
prepayments and any conversions) of any Advance occurs on a date
which is not the last day of a Rent Period applicable thereto, or
(iii), if, for any reason, any Lessee defaults in its obligation to
pay Basic Rent when required by the terms of the Lease.
(g) Assumptions Concerning Funding of LIBOR Advances. Calculation of
all amounts payable to an Affected Party under this Section 7.5
shall be made as though that Affected Party had actually funded its
relevant LIBOR Advances through the purchase of deposits in the
relevant market bearing interest at the rate applicable to such
LIBOR Advances in an amount equal to the amount of the LIBOR
Advances and having a maturity comparable to the relevant Rent
Period and through the transfer of such LIBOR Advances from an
offshore office of that Affected Party to a domestic office of that
Affected Party in the United States of America; provided, however
that each Affected Party may fund each of its LIBOR Advances in any
manner it sees fit and the foregoing assumption shall be used only
for calculation of amounts payable under this Section 7.5.
(h) Capital Adequacy. Without limiting any other provision of this
Master Agreement, in the event that any Affected Party shall have
determined that any law, treaty, governmental (or
quasi-governmental) rule, regulation, guideline or order regarding
capital adequacy not currently in effect or fully applicable as of
the Initial Closing Date, or any change therein or in the
interpretation or application thereof after the Initial Closing
Date, or compliance by such Affected Party with any request or
directive regarding capital adequacy not currently in effect or
fully applicable as of the Initial Closing Date (whether or not
having the force of law and whether or not failure to comply
therewith would be unlawful) from a central bank or governmental
authority or body having jurisdiction, does or shall have the
effect of reducing the rate of return on such Affected Party's
capital as a consequence of its obligations hereunder, under any
other Operative Document or under any Program Support Agreement to
a level below that which such Affected Party could have achieved
but for such law, treaty, rule, regulation, guideline or order, or
such change or compliance (taking into consideration such Affected
Party's policies with respect to capital adequacy) by an amount
deemed by such Affected Party to be Material, then within ten (10)
Business Days after written notice and demand by such Affected
Party (with copies thereof to the Agent), the Lessees, jointly and
severally, shall from time to time pay to such Affected Party
additional amounts sufficient to compensate such Affected Party for
such reduction (but, in the case of outstanding Base Rate Advances,
without duplication of any amounts already recovered by such
Affected Party by reason of an adjustment in the applicable Base
Rate). Each certificate as to the amount payable under this Section
7.5(h) (which certificate shall set forth the basis for requesting
such amounts in reasonable detail), submitted to Dollar by any
Affected Party in good faith, shall, absent manifest error, be
final, conclusive and binding for all purposes.
(i) Limitation on Certain Payment Obligations.
(a) Each Affected Party or the Agent shall make written demand on
Dollar for indemnification or compensation pursuant to Section
7.5(a)(ii) no later than six months after the earlier of (i)
on the date on which such Affected Party or the Agent makes
payment of any such Taxes and (ii) the date on which the
relevant taxing authority or other governmental authority
makes written demand upon such Affected Party or the Agent for
the payment of such Taxes.
(b) Each Affected Party or the Agent shall make written demand on
Dollar for indemnification or compensation pursuant to Section
7.5(f) no later than six months after the event giving rise to
the claim for indemnification or compensation occurs.
(c) Each Affected Party or the Agent shall make written demand on
Dollar for identification or compensation pursuant to Section
7.5(d) or Section 7.5(h) no later than six months after such
Affected Party or the Agent receives actual notice or obtains
actual knowledge of the promulgation of a law, rule, order,
interpretation or occurrence of another event giving rise to a
claim pursuant to such provisions.
(d) In the event that an Affected Party or the Agent fail to give
Dollar notice within the time limitations set forth above, no
Lessee shall have any obligation to pay amounts with respect
to such claims accrued prior to six months preceding any
written demand therefor.
SECTION 7.6 End of Term Indemnity.
In the event that at the end of the Lease Term: (i) the Lessees elect
the option set forth in Section 14.6 of the Lease, and (ii) after the Lessor
receives the sales proceeds from the Leased Properties under Section 14.6 or
14.7 of the Lease, together with such Lessees' payment of the Recourse
Deficiency Amount, the Lessor shall not have received the entire Lease Balance,
then, within 90 days after the end of the Lease Term, the Lessor or the Agent
may obtain, at the Lessees' sole cost and expense, a report from the Appraiser
(or, if the Appraiser is not available, another appraiser reasonably
satisfactory to the Lessor or the Agent, as the case may be, and approved by
Dollar, such approval not to be unreasonably withheld) in form and substance
satisfactory to the Lessor and the Agent (the "Report") to establish the reason
for any decline in value of one or more Leased Properties from the Leased
Property Balances therefor. The related Lessee or Lessees shall promptly
reimburse the Lessor for the amount equal to such decline in value to the extent
that the Report indicates that such decline was due to
(w) extraordinary use, failure to maintain, to repair, to restore,
to rebuild or to replace, failure to comply with all Applicable
Laws, failure to use good workmanship, method of installation or
removal or maintenance, repair, rebuilding or replacement, or any
other cause or condition within the power of the related Lessee to
control or effect resulting in the Building failing to be a store,
office building or warehouse, as the case may be, of the type and
quality contemplated by the Appraisal (excepting in each case
ordinary wear and tear), or
(x) any Alteration made to, or any rebuilding of, the Leased
Property or any part thereof by the related Lessee, or
(y) any restoration or rebuilding carried out by the related Lessee
or any condemnation of any portion of the Leased Property pursuant
to Article X of the Lease, or
(z) any use of such Leased Property or any part thereof by the
related Lessee other than as permitted by the Lease, or any act or
omission constituting a breach of any requirement, condition,
restriction or limitation set forth in the related Deed or the
related Purchase Agreement.
SECTION 8 MISCELLANEOUS
SECTION 8.1 Survival of Agreements.
The representations, warranties, covenants, indemnities and agreements
of the parties provided for in the Operative Documents, and the parties'
obligations under any and all thereof, shall survive the execution and delivery
and the termination or expiration of this Master Agreement and any of the
Operative Documents, the transfer of any Land to the Lessor as provided herein
(and shall not be merged into any Deed), any disposition of any interest of the
Lessor in any Leased Property, the purchase and sale of the Notes, payment
therefor and any disposition thereof and shall be and continue in effect
notwithstanding any investigation made by any party hereto or to any of the
other Operative Documents and the fact that any such party may waive compliance
with any of the other terms, provisions or conditions of any of the Operative
Documents.
SECTION 8.2 Notices.
Unless otherwise specified herein, all notices, requests, demands or
other communications to or upon the respective parties hereto shall be addressed
to such parties at the addresses therefor as set forth in Schedule 8.2, or such
other address as any such party shall specify to the other parties hereto, and
shall be deemed to have been given (i) the Business Day after being sent, if
sent by overnight courier service; (ii) the Business Day received, if sent by
messenger; (iii) the day sent, if sent by facsimile and confirmed electronically
or otherwise during business hours of a Business Day (or on the next Business
Day if otherwise sent by facsimile and confirmed electronically or otherwise);
or (iv) three Business Days after being sent, if sent by registered or certified
mail, postage prepaid.
SECTION 8.3 Counterparts.
This Master Agreement may be executed by the parties hereto in separate
counterparts (including by facsimile), each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 8.4 Amendments.
No Operative Document nor any of the terms thereof may be terminated,
amended, supplemented, waived or modified with respect to the Lessees or any
Funding Party, except (a) in the case of a termination, amendment, supplement,
waiver or modification to be binding on the Lessees, with the written agreement
or consent of Dollar, and (b) in the case of a termination, amendment,
supplement, waiver or modification to be binding on the Funding Parties, with
the written agreement or consent of the Administrator and the Required Liquidity
Banks; provided, however, that (w) notwithstanding the foregoing provisions of
this Section 8.4, the consent of the Administrator and each Liquidity Bank
affected thereby shall be required for any amendment, modification or waiver:
o modifying any of the provisions of this Section 8.4, or
changing the definition of "Required Liquidity Bank";
o reducing any amount payable to, or for the benefit of, Lender
or such Liquidity Banks under the Operative Documents or
extending the time for payment of any such amount; or
o consenting to any assignment of the Lease or the extension of
the Lease Term, releasing any of the collateral assigned to
the Agent pursuant to any Mortgage and any Assignment of Lease
and Rents (but excluding a release of any rights that the
Agent may have in any Leased Property, or the proceeds thereof
as contemplated in the definition of "Release Date"),
releasing any Lessee from its obligations in respect of the
payments of Rent and the Lease Balance, releasing Dollar from
its obligations under the Guaranty Agreement or the other
Operative Documents or changing the absolute and unconditional
character of any such obligation;
(x) notwithstanding the foregoing provisions of this Section 8.4,
the consent of each Funding Party affected thereby shall be
required for any amendment, modification or waiver:
(i) amending, modifying, waiving or supplementing any of the
provisions of Section 3 of the Loan Agreement or the
representations of such Funding Party in Section 4.2 or 4.3 or
the covenants of such Funding Party in Section 6 of this
Master Agreement;
(ii) reducing any amount payable to such Funding Party under the
Operative Documents or extending the time for payment of any
such amount, including, without limitation, any Rent, any
Funded Amount, any fees, any indemnity, the Leased Property
Balance, the Lease Balance, any Funding Party Balance,
Recourse Deficiency Amount, interest or Yield; and
(y) no such termination, amendment, supplement, waiver or
modification shall, without the written agreement or consent
of the Lessor, the Agent and the Required Liquidity Banks, be
made to the Lease or the Construction Agency Agreement; and
(z) subject to the foregoing clauses (w), (x) and (y), so long as
no Event of Default has occurred and is continuing, the
Lessor, the Agent and the Lender may not amend, supplement,
waive or modify any terms of the Loan Agreement, the Notes,
the Mortgages and the Assignments of Lease and Rents without
the consent of Dollar (such consent not to be unreasonably
withheld or delayed); provided that in no event may the Loan
Agreement or the Notes be amended so as to increase the amount
of Basic Rent payable by any Lessee without the consent of
Dollar.
The Administrator shall promptly provide copies of each such amendment,
supplement, waiver and modification to the Rating Agencies.
SECTION 8.5 Headings, etc.
The Table of Contents and headings of the various Articles and Sections
of this Master Agreement are for convenience of reference only and shall not
modify, define, expand or limit any of the terms or provisions hereof.
SECTION 8.6 Parties in Interest.
Except as expressly provided herein, none of the provisions of this
Master Agreement is intended for the benefit of any Person except the parties
hereto and their respective successors and permitted assigns.
SECTION 8.7 GOVERNING LAW.
THIS MASTER AGREEMENT HAS BEEN DELIVERED IN, AND SHALL IN ALL RESPECTS
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
TENNESSEE APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH
STATE, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
SECTION 8.8 Expenses.
Whether or not the transactions herein contemplated are consummated,
each Lessee, jointly and severally, agrees to pay, as Supplemental Rent, all
actual, reasonable and documented out-of-pocket costs and expenses of the
Lessor, the Agent, the Administrator and the Lender in connection with the
preparation, execution and delivery of the Operative Documents and the documents
and instruments referred to therein and any amendment, waiver or consent
relating thereto (including, without limitation, the reasonable fees and
disbursements of Xxxxx, Xxxxx & Xxxxx, but not including any fees and
disbursements for any other outside counsel representing any Liquidity Bank) and
of the Lessor, the Agent, the Lender, the Administrator and the Liquidity Banks
in connection with the enforcement of the Operative Documents and the documents
and instruments referred to therein (including, without limitation, the
reasonable fees actually incurred and disbursements of counsel for the Lessor,
the Agent, the Lender, the Administrator and the Liquidity Banks). All
references in the Operative Documents to "attorneys' fees" or "reasonable
attorneys fees" shall mean reasonable attorneys' fees actually incurred, without
regard to any statutory definition thereof.
SECTION 8.9 Severability.
Any provision of this Master Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 8.10 Liabilities of the Funding Parties.
No Funding Party shall have any obligation to any other Funding Party
or to any Lessee with respect to the transactions contemplated by the Operative
Documents except those obligations of such Funding Party expressly set forth in
the Operative Documents or except as set forth in the instruments delivered in
connection therewith, and no Funding Party shall be liable for performance by
any other party hereto of such other party's obligations under the Operative
Documents except as otherwise so set forth. Each of the parties hereto hereby
agrees that it will not institute against Lender, or join any other Person in
instituting against Lender, any insolvency, bankruptcy, reorganization or
similar proceeding so long as there shall not have elapsed one year and one day
since the last day on which any Commercial Paper shall be outstanding.
Notwithstanding any other provision of this Master Agreement or any other
Operative Document, all obligations and liabilities of the Lender hereunder and
under the other Operative Documents shall be limited recourse to the Lender,
such recourse being limited to funds available therefor after payment of all
obligations on Commercial Paper pursuant to the Lender's Program Support
Agreements. Any amount which the Lender does not pay pursuant to the operation
of the preceding sentence shall not constitute a claim (as defined in ss.101 of
the Bankruptcy Code) against the Lender, unless and until such payment may be
made in accordance with the preceding sentence. The provisions of this Section
8.10 shall survive the termination of this Master Agreement and the Lease.
SECTION 8.11 Submission to Jurisdiction; Waivers.
Each party hereto hereby irrevocably and unconditionally:
o submits for itself and its property in any legal action or
proceeding relating to this Master Agreement or any other
Operative Document, or for recognition and enforcement of any
judgment in respect thereof, to the non-exclusive general
jurisdiction of the Courts of the State of Tennessee sitting
in Davidson County, the courts of the United States of America
for the Middle District of Tennessee, and appellate courts
from any thereof;
o consents that any such action or proceedings may be brought to
such courts, and waives any objection that it may now or
hereafter have to the venue of any such action or proceeding
in any court or that such action or proceeding was brought in
an inconvenient court and agrees not to plead or claim the
same;
o agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar
form of mail), postage prepaid, to such party at its address
set forth in Schedule 8.2 or at such other address of which
the other parties hereto shall have been notified pursuant to
Section 8.2; and
o agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law.
SECTION 8.12 Liabilities of the Agent.
The Agent shall have no duty, liability or obligation to any party to
this Master Agreement with respect to the transactions contemplated hereby
except those duties, liabilities or obligations expressly set forth in this
Master Agreement, the Loan Agreement or the Liquidity Agreement, and any such
duty, liability or obligations of the Agent shall be as expressly limited by
this Master Agreement, the Loan Agreement or the Liquidity Agreement, as the
case may be. All parties to this Master Agreement acknowledge that the Agent is
not, and will not be, performing any due diligence with respect to documents and
information received pursuant to this Master Agreement or any other Operative
Agreement including, without limitation, any Environmental Audit, Title Policy
or survey. The acceptance by the Agent of any such document or information shall
not constitute a waiver by any Funding Party of any representation or warranty
of any Lessee or Guarantor even if such document or information indicates that
any such representation or warranty is untrue. None of First Union National
Bank, in its capacity as Syndication Agent, Bank of America National Trust and
Savings Association, in its capacity as Documentation Agent, The First National
Bank of Chicago, in its capacity as Co-Agent, or Wachovia Bank, N.A., in its
capacity as Co-Agent, shall have any obligations or duties under the Operative
Documents, provided that the foregoing shall not affect such institutions'
obligations as Liquidity Banks.
MASTER
AGREEMENT
IN WITNESS WHEREOF, the parties hereto have caused this Master Agreement to be
duly executed by their respective officers thereunto duly authorized as of the
day and year first above written.
DOLLAR GENERAL CORPORATION, as a Lessee and as Guarantor
By:
Name Printed:
Title:
ATLANTIC FINANCIAL GROUP, LTD., as Lessor
By: Atlantic Financial Managers, Inc., its
General Partner
By:
Name Printed: Xxxxxxx Xxxxxxxxxx
Title: President
SUNTRUST BANK, NASHVILLE, N.A., as Agent,
Liquidity Agent and a Liquidity Bank
By:
Name Printed:
Title:
By:
Name Printed:
Title:
THREE PILLARS FUNDING CORPORATION,
as Lender
By:
Name Printed:
Title:
FIRST UNION NATIONAL BANK, as
Syndication Agent and as a Liquidity Bank
By:
Name Printed:
Title:
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as
Documentation Agent and as a Liquidity
Bank:
By:
Name Printed:
Title:
THE FIRST NATIONAL BANK OF CHICAGO, as a
Co-Agent and as a Liquidity Bank
By:
Name Printed:
Title:
WACHOVIA BANK, N.A., as a Co-Agent and a
Liquidity Bank
By:
Name Printed:
Title:
BARCLAYS BANK, PLC, as a Liquidity Bank
By:
Name Printed:
Title:
PNC BANK, N.A., as a Liquidity Bank
By:
Name Printed:
Title:
FIRSTAR CORPORATION, as a Liquidity Bank
By:
Name Printed:
Title:
SUNTRUST EQUITABLE SECURITIES
CORPORATION, as Administrator
By:
Name Printed:
Title:
SCHEDULE 2.2
AMOUNT OF EACH FUNDING PARTY'S COMMITMENT
Lessor Commitment Percentage: 3.5%
Lessor Commitment: $7,000,000
Lender Commitment Percentage: 96.5%
Lender Commitment: $193,000,000
SCHEDULE 8.2
ADDRESSES FOR NOTICES
Lessee: Dollar General Corporation
000 Xxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx Xxxxxxx
Fax No.: 502/000-0000
Dollar General Corporation
000 Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Chief Financial Officer
Fax No.: 615/000-0000
Administrator: SunTrust Equitable Securities Corporation
000 Xxxxxxxxx Xxxxxx
Xxxxx 0000
MC 3943
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx Xxxxxxx
Fax No.: 404/000-0000
Lessor: Atlantic Financial Group, Ltd.
c/o Grogan & Xxxxxxx
0000 Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attn: Xxxxxxx Xxxxxxxxxx
Fax No.: 214/000-0000
Lender and Agent: SunTrust Bank, Nashville, N.A.
000 0xx Xxxxxx Xxxxx
Xxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxx Xxxxxx
Fax No.: 615/000-0000
Liquidity Banks: First Union National Bank
c/o First Union Capital Markets Corporation
000 Xxxxx Xxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxx
Fax No.: 704/000-0000
Bank of America
Bank of America Xxxxxxxxx Xxxxxx
XX0000-00-00
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxx Xxxxx
Fax No.: 704/000-0000
Wachovia Bank
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Xxx Xxxxxxxxxx
Fax No.: 404/000-0000
The First National Bank of Chicago
Mail Suite 0086
One First Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxxx
Fax No.: 312/000-0000
PNC Bank
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx Xxxxxxx
Fax No.: 502/000-0000
Barclays Bank
Miami Agency
Domestic Banking Group
000 Xxxxxxxx Xxxxxx
00xx Xxxxx
Xxxxx, Xxxxxxx 00000
Attn: Xxxxxx Xxxx
Fax No.: 305/000-0000
Firstar Bank
000 Xxxxxx Xxxxxx
XX 0000
Xxxxxxxxxx, Xxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
Fax No.: 513/000-0000
