Exhibit 10.74
ASSIGNMENT OF LEASE, RENTS AND GUARANTEE
from
HANOVER EQUIPMENT TRUST 2001B, Assignor
to
WILMINGTON TRUST FSB, as Collateral Agent, Assignee
August 31, 2001
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS
1.1 Defined Terms......................................................... 1
SECTION 2. EQUIPMENT AND TERM
2.1 Equipment............................................................. 1
2.2 Lease Term............................................................ 1
2.3 Title................................................................. 1
SECTION 3. RENT
3.1 Rent.................................................................. 2
3.2 Supplemental Rent..................................................... 2
SECTION 4. WARRANTIES
4.1 Warranties............................................................ 2
SECTION 5. QUIET ENJOYMENT
5.1 Quiet Enjoyment....................................................... 3
SECTION 6. NET LEASE
6.1 Net Lease; No Setoff; Ect............................................. 3
6.2 No Termination or Abatement........................................... 4
SECTION 7. OWNERSHIP OF EQUIPMENT
7.1 Ownership of the Equipment............................................ 4
SECTION 8. CONDITION OF EQUIPMENT
8.1 Disclaimer of Warranties.............................................. 6
8.2 Possession and Use of the Equipment................................... 7
SECTION 9. COMPLIANCE
9.1 Compliance with Legal Requirements and Insurance Requirements......... 7
9.2 Environmental Matters................................................. 7
SECTION 10. MAINTENANCE, REPAIR AND RETURN REQUIREMENTS
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10.1 Maintenance and Repair............................................... 8
10.2 Return Requirements.................................................. 9
10.3 Right of Inspection and Location..................................... 10
SECTION 11. MODIFICATIONS
11.1 Modifications........................................................ 10
SECTION 12. TITLE
12.1 Warranty of Title.................................................... 11
12.2 Indentification...................................................... 11
SECTION 13. PERMITTED CONTESTS
13.1 Permitted Contests Other Than in Respect of Impositions.............. 12
SECTION 14. INSURANCE
14.1 Public Liability and Worker's Compensation Insurance................. 12
14.2 Hazard and Other Insurance........................................... 12
14.3 Coverage............................................................. 13
SECTION 15. CONDEMNATION AND CASUALTY
15.1 Casualty and Condemnation............................................ 14
SECTION 16. LEASE TERMINATION
16.1 Termination upon Certain Events...................................... 15
16.2 Procedures........................................................... 15
SECTION 17. DEFAULT
17.1 Lease Events of Default.............................................. 16
17.2 Final Liquidated Damages............................................. 17
17.3 Remedies............................................................. 17
17.4 Additional Remedies.................................................. 19
17.5 Proceeds of Sale; Deficiency......................................... 19
17.6 Waiver of Certain Rights............................................. 19
17.7 Assignment of Rights Under Contracts................................. 19
SECTION 18. XXXXXX'S RIGHT TO CURE
18.1 Lessor's Right to Cure Lessee's Lease Defaults....................... 20
SECTION 19. LEASE TERMINATION
19.1 Provisions Relating to Lessee's Termination of this Lease or
Exercise of Purchase Option.......................................... 20
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SECTION 20. PURCHASE OF OPTION
20.1 Purchase Option...................................................... 20
20.2 Expiration Date Purchase Option...................................... 22
20.3 Obligation to Purchase All Equipment................................. 22
SECTION 21. SALE OF EQUIPMENT
21.1 Sale Procedure....................................................... 23
21.2 Application of Proceeds of Sale...................................... 23
21.3 Indemnity for Excessive Wear......................................... 24
21.4 Appraisal Procedure.................................................. 24
21.5 Certain Obligations Continue......................................... 24
SECTION 22. HOLDING OVER
22.1 Holding Over......................................................... 24
SECTION 23. RISK OF LOSS
23.1 Risk of Loss......................................................... 25
SECTION 24. SUBLETTING AND ASSIGNMENT
24.1 Subletting and Assignment............................................ 25
24.2 Subleases or Licenses................................................ 25
SECTION 25. ESTOPPEL CERTIFICATES
25.1 Estoppel Certificates................................................ 25
SECTION 26. NO WAIVER
26.1 No Waiver............................................................ 26
SECTION 27. ACCEPTANCE OF SURRENDER
27.1 Acceptance of Surrender.............................................. 26
SECTION 28. OWNERSHIP, GRANT OF SECURITY INTEREST AND FURTHER
ASSURANCES
28.1 Grant of Security Interests.......................................... 26
28.2 UCC Remedies......................................................... 27
28.3 Deficiency........................................................... 28
28.4 Trustee's Appointment as Attorney-in-Fact; Trustee's Performance
of Lessee's Obligations.............................................. 28
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SECTION 29. NOTICES
29.1 Notices............................................................. 29
SECTION 30. SUBSTITUTION
30.1 Substitution........................................................ 31
SECTION 31. SUBORDINATION
31.1 Agreement to Subordinate............................................ 33
31.2 Liquidation, Dissolution, Bankruptcy................................ 33
31.3 Default on Guarantor Senior Indebtedness of Lessee.................. 34
31.4 Acceleration of Payment of Rent..................................... 34
31.5 When Rents Must be Paid Over........................................ 34
31.6 Subrogation......................................................... 35
31.7 Relative Rights..................................................... 35
31.8 Subordination May Not Be Impaired by Lessee......................... 35
31.9 Distribution or Notice to Representative............................ 35
31.10 Section 31 Not to Prevent Events of Default or
Limit Right to Accelerate........................................... 35
31.11 Reliance by Holders of Guarantor Senior Indebtedness
on Subordination Provisions......................................... 35
SECTION 32. MISCELLANEOUS
32.1 Miscellaneous....................................................... 36
32.2 Amendments and Modifications........................................ 36
32.3 Successors and Assigns.............................................. 36
32.4 Headings and Table of Contents...................................... 36
32.5 Counterparts........................................................ 36
32.6 GOVERNING LAW....................................................... 36
32.7 Limitations on Recourse............................................. 36
32.8 Priority............................................................ 37
Description of Equipment........................................... Schedule A
Form of Lease Supplement........................................... Exhibit A
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ASSIGNMENT OF LEASE, RENTS AND GUARANTEE
THIS ASSIGNMENT OF LEASE, RENTS AND GUARANTEE dated as of
August 31, 2001 (this "Assignment"), made by HANOVER EQUIPMENT TRUST 2001B, a
Delaware business trust (the "Assignor"), to WILMINGTON TRUST FSB, a federal
savings bank, in its capacity as Collateral Agent (in such capacity, "Assignee")
under the Indenture dated as of the date hereof (as amended, supplemented or
otherwise modified from time to time, the "Indenture") among the Assignor,
Wilmington Trust FSB, as Indenture Trustee, and the Hanover Guarantors, and
under the Participation Agreement (as defined below), for the first priority
benefit of the Securityholders and the second priority benefit of the
Certificate Holders.
Preliminary Statement
A. On the date hereof, the Assignor and Hanover Compression
Limited Partnership (the "Lessee") entered in a Lease whereby the Assignor
agreed to lease certain Equipment to the Lessee. Simultaneously with the
execution of the Lease, the Guarantors entered into the Hanover Guarantee which,
among other obligations, guarantees all of the Lessee's obligations under the
Lease.
B. Pursuant to the Indenture, the Securityholders have agreed
to advance to the Assignor in an aggregate amount not to exceed $250,000,000
upon the terms and subject to the conditions set forth therein, to be evidenced
by the Securities issued by the Assignor under the Indenture.
C. Pursuant to the Trust Agreement and the Participation
Agreement, the Certificate Holders have agreed to make the Certificate Holder
Contributions to the Assignor in an aggregate amount not to exceed $7,750,000
upon the terms and subject to the conditions set forth therein, to be evidenced
by Certificates issued by Assignor under the Trust Agreement.
D. It is a condition, among others, to the obligation of the
Securityholders to purchase Securities and the Certificate Holders to make
Certificate Holder Contributions to the Assignor that the Assignor shall have
executed and delivered, and the Lessee and the Guarantors shall have consented
to, this Assignment to the Assignee for the ratable benefit of, first, the
Securityholders and thereafter the Certificate Holders.
NOW, THEREFORE, in consideration of the foregoing, the parties
hereto agree as follows:
1. Defined Terms. Capitalized terms used but not
otherwise defined in this Assignment shall have the respective meanings
specified in Annex A to the Participation Agreement dated as of the date hereof
among the Lessor, the Lessee, the Certificate Holders, the Hanover Guarantors,
the Indenture Trustee and the Trust Company, as such Participation Agreement may
be amended, supplemented or otherwise modified from time to time. A copy of the
Participation Agreement or of the other agreements referenced herein or therein
may be obtained from any of the parties hereto at the addresses set forth
herein.
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2. Assignment. The Assignor hereby irrevocably assigns,
transfers, sets over and conveys to the Assignee, all the following-described
property relating to or arising in connection with the Equipment, whether now
owned or held or hereafter acquired, exclusively and without any reservation
thereof unto the Assignor:
(a) Subject to Section 7 hereof, all of the estate, right,
title, interest, benefits, powers and privileges of the Assignor, as lessor,
under the Lease, as the Lease is supplemented from time to time pursuant to one
or more Lease Supplements, including, without limitation, (i) the immediate and
continuing right to make claim for, receive, collect and receipt for all rents,
income, revenues, issues, profits, insurance proceeds, sales proceeds and other
sums payable to or receivable by the Assignor under the Lease, or pursuant to
any provisions thereof, whether as rent or as the purchase price or termination
payment for any interest in the Equipment or otherwise (including, without
limitation, the Final Rent Payment, the Purchase Option Price, Equity Proceeds
Purchase Price, Control Purchase Price, Excess Proceeds Purchase Price,
Termination Value, Basic Rent, Supplemental Rent, Certificate Holder Yield and
any sales proceeds payable to the Assignor pursuant to the Lease) (collectively,
the "Lease Rents"), including all cash, securities or letters of credit, if any,
delivered or deposited pursuant thereto to secure performance by the Lessee of
its obligations thereunder, (ii) the right and power (which right and power are
coupled with an interest) upon the purchase by the Lessee of the interest of the
Assignor in the Equipment in accordance with the Lease to execute and deliver as
irrevocable agent and attorney-in-fact of the Assignor an appropriate instrument
necessary to convey the interest of the Assignor therein, or to pay over or
assign to the Assignee those sums to which it is entitled if the Lessee becomes
obligated to purchase the interest of the Assignor in the Equipment and to
perform all other necessary or appropriate acts as said agent and
attorney-in-fact with respect to any such purchase and conveyance, (iii) the
right to perform all other necessary or appropriate acts as said agent and
attorney-in-fact with respect to any purchase or conveyance referred to in
clause (ii) above, (iv) the right to declare the Lease to be in default under
Section 17.1 thereof, (v) the right to exercise remedies under or with respect
to the Lease, (vi) the right to make all waivers and agreements on behalf of the
Assignor under the Lease provided for or permitted under the Lease, (vii) the
right to give all notices, consents, releases and other instruments provided
under the Lease, (viii) the right to give all notices of default and to take all
action upon the happening of a Lease Default or a Lease Event of Default,
including the commencement, conduct and consummation of proceedings as shall be
permitted under any provision of the Lease, or by law or in equity, (ix) the
right to receive all notices, certificates, financial statements and other
documents sent to the Assignor under the Lease, (x) the Assignor's interest
under the Lease in the Lessee's tangible and intangible property used or arising
in connection with the Equipment, including, but not limited to, permits,
licenses, contract rights and prepaid expenses, (xi) the grant of lien and
security interest by the Lessee pursuant to the Lease; and (xii) the right to do
any and all other things whatsoever which the Assignor is or any lessor or
mortgagor or secured party is, or may be entitled to do under the Lease;
provided that the Assignor shall retain, and the Lease Rents shall not include,
the Excepted Payments and the Lessor shall retain, and the rights and powers
assigned herein shall in no event include, the Excepted Rights and shall be
subject to the Shared Rights.
(b) All of the estate, right, title, interest, benefits,
powers and privileges of the Assignor in, to and under all other leases,
subleases or licenses of the Equipment, any license,
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concession, management or other agreements of a similar kind that permit the use
or occupancy of the Equipment or any part thereof for any purpose in return for
any payment, now or hereafter entered into by the Assignor (collectively, the
"Other Leases" and, together with the Lease, the "Leases"), together with all
estate, rights, title, interest, benefits, powers and privileges of the
Assignor, as lessor, under the Other Leases including the immediate and
continuing right to make claim for, receive, collect and receipt for all
charges, fees, income, issues, profits, receipts, rents, revenues or royalties
payable under any of the Other Leases (collectively, the "Other Lease Rents")
and all estate, right, title and interest of the Assignor thereunder, including
all cash, securities or letters of credit, if any, delivered or deposited
thereunder to secure performance by the lessees under Other Leases of their
obligations thereunder; provided that the Assignor shall retain, and the Lease
Rents shall not include, the Excepted Payments and the Lessor shall retain and
the rights and powers assigned herein shall in no event include the Excepted
Rights and shall be subject to the Shared Rights.
(c) All of the estate, right, title, interest, benefits,
powers and privileges of the Assignor, to and under all agreements or contracts
for the sale or other disposition of all or any part of the Equipment, now or
hereafter entered into by the Assignor (collectively, the "Contracts"), together
with all estate, rights, title, interest, benefits, powers and privileges of the
Assignor under the Contracts including, without limitation, the immediate and
continuing right to make claim for, receive, collect and receipt for all
charges, fees, income, issues, profits, receipts, rents, revenues or royalties
payable under any of the Contracts (collectively, the "Contract Rents" and,
together with the Lease Rents and the Other Lease Rents, the "Rents" ) and all
right, title and interest of the Assignor thereunder, including all cash,
securities or letters of credit, if any, deposited thereunder to secure
performance by the obligors of their obligations thereunder; provided that the
Assignor shall retain, and the Lease Rents shall not include, the Excepted
Payments and the Lessor shall retain and the rights and powers assigned herein
shall in no event include the Excepted Rights and shall be subject to the Shared
Rights.
(d) All of the estate, right, title, interest, benefits,
powers and privileges of the Assignor under the Hanover Guarantee including,
without limitation, (i) the immediate and continuing right to make claim for,
receive, collect and receipt for all Guaranteed Obligations and other sums
payable to or receivable by the Assignor under the Hanover Guarantee, or
pursuant to any provisions thereof, (ii) the right to exercise remedies under or
with respect to the Hanover Guarantee, (iii) the right to make all waivers and
agreements on behalf of the Assignor under the Hanover Guarantee provided for or
permitted under the Hanover Guarantee, (iv) the right to give all notices,
consents, releases and other instruments provided under the Hanover Guarantee,
and (v) the right to give all notices of default and to take all action as shall
be permitted under any provision of the Hanover Guarantee or by law or in
equity; provided that the Assignor shall retain the Excepted Payments and the
Lessor shall retain, and the rights and powers assigned herein shall in no event
include, the Excepted Rights and shall be subject to the Shared Rights.
(e) All of the right, title and interest of the Assignor in
and to all claims and rights to the payment of money at any time arising in
connection with any repudiation, rejection or breach of the Lease by the Lessee
or a trustee or receiver of the Lessee (whether pursuant to the Lease, the
Hanover Guarantee or any Other Lease by any lessee thereunder, trustee or
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receiver of any such lessee) under any insolvency statute, law or regulation,
including all rights to recover damages arising out of such breach or rejection,
all rights to charges payable by the Lessee or such trustee or receiver (or by
such lessee, trustee or receiver) in respect of the Equipment or any portions
thereof following rejection, repudiation or disaffirmance of the Lease or
following the entry of an order for relief under any insolvency statute, law or
regulation in respect of the Lessee (or such lessee) and all rentals and other
charges outstanding under the Lease (or Other Lease) as of the date of entry of
such order for relief; provided that the Assignor shall retain and the Lease
Rents shall not include, the Excepted Payments and the Lessor shall retain and
the rights and powers assigned herein shall in no event include, the Excepted
Rights and shall be subject to the Shared Rights.
The Assignor hereby agrees that any action taken by Assignee (or its designee)
pursuant to this Assignment shall be exclusive, and no party relying on such
action of the Assignee (or such designee) pursuant hereto shall be required to
obtain the concurrence or consent of the Assignor to such action or to a request
for such action. The Assignor further agrees that this Agreement shall not
relieve Assignor from any obligations it may have as lessor under the Lease.
3. Receipt of Payments. The Assignor hereby irrevocably
designates the Assignee (or its designee) to receive all payments of (i) the
Lease Rents, the Other Lease Rents and the Contract Rents and any other sums
payable to the Assignor under the Lease, any Other Lease or any Contract and
(ii) all Guaranteed Obligations and any other sums payable to the Assignor under
the Hanover Guarantee. The Assignor agrees to direct (and hereby directs) the
Lessee, any other lessees and any contracting parties to deliver to the Assignee
(or its designee), at its address provided herein or at such other address or to
such other Person as the Assignee shall designate, all such payments and sums on
account of the Rents, and no delivery thereof by the Lessee, such other lessee
or such contracting party shall be of any force or effect unless made to the
Assignee (or its designee), as herein provided. The Rents shall for all purposes
be considered the property of the Assignee and not of the Assignor, whether
before or after the occurrence of an Event of Default.
The Assignor shall at all times retain the right, but not to the exclusion of
the Assignee, (A) to receive from the Lessee all notices, certificates and other
documents and all information that the Lessee is permitted or required to give
or furnish to the "Lessor" pursuant to the Lease, the Participation Agreement or
any other Operative Document, (B) to inspect the Equipment, (C) to retain all
rights with respect to insurance that Section 14 of the Lease specifically
confers upon the "Lessor", (D) to provide such insurance as the Lessee shall
have failed to maintain or as the Assignor may desire and (E) to enforce
compliance by the Lessee with the provisions of Section 8, 9, 10, 11 and 14 of
the Lease.
4. Receipt of Notices. The Assignor hereby designates
the Assignee (or its designee) to receive (in addition to, and not to the
exclusion of, the Assignor) duplicate originals or copies of all notices,
undertakings, demands, statements, documents, financial statements and other
communications which the Lessee, the Guarantors, any other lessee or any
contracting party is required or permitted to give, make, deliver to or serve
pursuant to the Lease, the Hanover Guarantee, any Other Lease or any Contract.
The Assignor agrees to direct (and hereby directs) the Lessee, the Guarantors,
and such other lessees and contracting parties to deliver to
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the Assignee (or its designee), at its address provided herein or at such other
address or to such other Person as the Assignee shall designate, duplicate
originals or copies of all such notices, undertakings, demands, statements,
documents, financial statements and other communications, and no delivery
thereof by the Lessee, the Guarantors, such other lessee or such contracting
party shall be of any force or effect unless made to the Assignor and also made
to the Assignee (or its designee), as herein provided. The Assignor further
agrees that upon receipt by the Assignor of any such notices, undertakings,
demands, statements, documents, financial statements and other communications,
the Assignor shall promptly deliver copies thereof to the Assignee unless the
Assignor shall reasonably believe that the Assignee has already received such
copies.
5. Irrevocability; Supplemental Instruments. The
Assignor agrees that this Assignment and the designation and direction to the
Lessee set forth in Sections 3 and 4 of this Assignment are irrevocable and that
it will not take any action as lessor under the Lease, or under the Hanover
Guarantee, or otherwise which is inconsistent with this Assignment and that any
action, assignment, designation or direction inconsistent herewith shall be
void. The Assignor will from time to time execute and deliver all instruments of
further assurance and do such further acts as may be necessary or proper to
carry out more effectively the purpose of this Assignment.
6. Validity. The Assignor represents and warrants and
covenants to the Assignee that (i) the Assignor has not assigned or executed any
assignment of, and will not assign or execute any assignment of its interest in
the Lease, of the Hanover Guarantee, of any Other Lease, of any Contract or of
any Rents or of any other subject matter of this Assignment to anyone other than
the Assignee and any assignment, designation or direction by the Assignor
inconsistent herewith shall be void, (ii) no Lease Event of Default has occurred
and is continuing and (iii) the Assignor has not done any act or executed any
document that impairs the rights of the Assignee to the Lease or the Lease Rents
or to the Hanover Guarantee under this Assignment.
7. The Assignor Remains Liable. While the assignment
made hereby is present, direct, absolute and continuing, it has been made for
the purpose of providing the Assignee with security for the performance of the
Assignor's obligations under the Indenture, the Securities, the Participation
Agreement and the other Operative Agreements to which it is a party and the
execution and delivery hereof shall not impair or diminish in any way the
obligations of the Assignor under the Lease or impose any of such obligations on
the Assignee. Neither the Assignee nor its designee shall be responsible or
liable for performing any of the obligations of the Assignor under the Lease,
any Other Lease or any Contract, for any waste by the Lessee or others, for any
dangerous or defective conditions of the Equipment, for negligence in the
management, upkeep, repair or control of the Equipment or any other act or
omission by any other Person. Nothing contained herein shall operate or be
construed to (i) obligate the Assignee (or its designee) to assume the
obligations of the Assignor under the Lease, any Other Lease or any Contract, to
perform any of the terms and conditions contained in the Lease, any Other Lease
or any Contract or otherwise to impose any obligation upon the Assignee with
respect to the Lease, any Other Lease or any Contract or (ii) place upon the
Assignee (or its designee) any responsibility for the operation, control, care,
management or repair of any of the Equipment or any part thereof. Subject at all
times to the terms and conditions of this Assignment, the
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Assignor will at all times promptly and faithfully perform in all respects, or
cause to be performed in all respects, all of its covenants, conditions and
agreements contained in the Lease, any Other Lease or any Contract now or
hereafter existing on the part of the Assignor to be kept and performed.
8. Amendments; Lessee's Consent. The Assignor will not
enter into any agreement subordinating, amending, extending or terminating the
Lease or the Hanover Guarantee, or any waiver of the terms thereof, without the
prior written consent thereto of the Assignee, which consent may be withheld in
Assignee's sole discretion, and any such attempted waiver, subordination,
amendment, modification, extension or termination without such consent shall be
void. If the Lease, the Hanover Guarantee, any Other Lease or any Contract shall
be amended, it shall continue to be subject to the provisions hereof without the
necessity of any further act by any of the parties hereto. The Assignor and the
Assignee hereby consent to the provisions of Xxxxxx's and Guarantor's Consent
attached to this Assignment and agree to be bound thereby.
9. Absolute Assignment. The Assignor has, subject to and
in accordance with the terms and conditions of this Assignment, assigned and
transferred unto the Assignee all of the Assignor's right, title and interest in
and to Rents now or hereafter arising from (i) the Lease, any Other Lease or any
Contract heretofore or hereafter made or agreed to by the Assignor and (ii) the
Hanover Guarantee, it being intended to establish an absolute transfer and
assignment, subject to and in accordance with the terms and conditions of this
Assignment, of all such Rents, Guaranteed Obligations, the Lease, the Hanover
Guarantee, the Other Leases and the Contracts to the Assignee and not merely to
grant a security interest therein. Subject to the terms of the Lease and
Xxxxxx's rights thereunder, the Assignee (or its designee) may in the Assignor's
name and stead operate the Equipment and rent, lease or let all or any portion
of the Equipment to any party or parties at such rental and upon such terms as
the Assignee (or its designee) shall, in its discretion, determine.
10. Ongoing Right to Collect Rents; Receivers. If
notwithstanding the terms of this Assignment, a petition or order for
sequestration of rents, or the appointment of a receiver or some similar
judicial action or order is deemed required under applicable state law to allow
the Assignee to continue to collect the moneys described in paragraphs 2 (a),
(b), (c), (d) and (e) of this Assignment, then it is agreed by the Assignor that
any proof of claim or similar document filed by the Assignee in connection with
the breach or rejection of the Lease by the Lessee thereunder or the trustee of
any lessee under any federal or state insolvency statute shall for the purpose
of perfecting the Assignee' s rights conferred in said paragraph 2(e) and to the
extent permitted under applicable law be deemed to constitute action required
under such state law. Upon the occurrence and during the continuance of an Event
of Default, the Assignor hereby consents to the appointment of a receiver for
any or all of the Equipment as a matter of right and without any requirement for
notice to the Assignor and without regard to the solvency of the Assignor or to
the collateral that may be available for the satisfaction of the Securities and
all other obligations under the Indenture and the other Operative Agreements.
11. Amendment. This Assignment may not be amended or
otherwise modified except by a writing signed by the Assignor and the Assignee
in accordance with the terms of the Indenture and the Participation Agreement.
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12. Notices. All notices, demands, requests, consents,
approvals and other instruments under this Assignment shall be made in
accordance with the notice provisions of the Participation Agreement.
13. Successors and Assigns. All covenants, agreements,
representations and warranties in this Assignment by the Assignor and the
Assignee shall bind, and shall inure to the benefit of and be enforceable by,
their respective successors and permitted assigns.
14. Severability. If any provision or provisions, or if
any portion of any provision or provisions, in this Assignment is found by a
court of law of competent jurisdiction to be in violation of any local, state or
Federal ordinance, statute, law, administrative or judicial decision, or public
policy, and if such court should declare such portion, provision or provisions
to be illegal, invalid, unlawful, void or unenforceable as written, then it is
the intent of the parties hereto that such portion, provision or provisions
shall be given force to the fullest possible extent that they are legal, valid
and enforceable, that the remainder of this Assignment shall be construed as if
such illegal, invalid, unlawful, void or unenforceable portion, provision or
provisions were not contained therein, and that the obligations of the Assignor
under the remainder of this Assignment shall continue in full force and effect.
15. Governing Law. THIS ASSIGNMENT SHALL BE GOVERNED BY,
AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, EXCEPT AS TO MATTERS RELATING TO THE CREATION OF LIENS AND THE EXERCISE OF
REMEDIES WITH RESPECT THERETO, WHICH SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE IN WHICH THE EQUIPMENT IS LOCATED.
16. Obligations Are Without Recourse. Anything to the
contrary herein notwithstanding, the Assignor's liability for any sums due
hereunder shall be limited in accordance with Section 9.8 of the Indenture.
17. Counterparts. This Assignment may be executed in any
number of counterparts, each of which shall be an original, but all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the Assignor has caused this Assignment to
be duly executed as of the day and year first above written.
HANOVER EQUIPMENT TRUST 2001B
By: Wilmington Trust Company, not in its
individual capacity but solely as Trustee
By:
--------------------------------------
Name:
Title:
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By execution of this Assignment, the Certificate Holders
hereby irrevocably assign, transfer, set over and convey to
the Assignee all of the estate, right, title, interest,
benefits, powers and privileges of the Certificate Holders
under the Hanover Guarantee, which transfer shall be in
accordance with all of the terms and provisions of this
Assignment (provided, however, that the Certificate Holders
shall not be liable for any of the obligations of the
Assignor under this Agreement).
GENERAL ELECTRIC CAPITAL CORPORATION, as
a Certificate Holder
By:
--------------------------------------
Name:
Title:
XXXXXX'S AND GUARANTOR'S CONSENT
As of this 31st day of August, 2001, HANOVER COMPRESSOR
COMPANY, a Delaware corporation, HANOVER COMPRESSION LIMITED PARTNERSHIP, a
Delaware limited partnership ("Lessee"), and certain of their Subsidiaries
listed on the signature pages hereto (collectively the "Guarantors",
individually a "Guarantor"), hereby consent and agree to all of the terms of the
Assignment of Lease, Rents and Guarantee dated as of the date hereof (the
"Assignment") made by HANOVER EQUIPMENT TRUST 2001B, a Delaware business trust
("Assignor"), and joined in by the Certificate Holders, in favor of Wilmington
Trust FSB, as Collateral Agent under the Indenture and the Participation
Agreement, and further agree as follows:
1. Definitions. Each capitalized term used herein and
not otherwise defined herein shall have the respective meanings ascribed thereto
in the Assignment, as such Assignment may be amended, supplemented or otherwise
modified from time to time.
2. Acknowledgments, Confirmations and Agreements. (a)
The Lessee acknowledges, confirms and agrees that: (i) the Lessee has the right,
power and authority to enter into this consent (this "Consent"); (ii) the Lease
is in full force and effect and enforceable in accordance with its terms; (iii)
neither the Lessee nor, to the Lessee's knowledge, the Assignor is in default in
the observance or performance of any condition or agreement to be observed or
performed by the Lessee or the Assignor, respectively, thereunder; (iv) no Lease
Rents have been paid by the Lessee except as provided in the Lease; (v) no Rent
has been waived, released, reduced, discounted or otherwise discharged or
compromised by the Assignor; and (vi) the Lessee has not received notice of any
other assignment of the Lessor's interest in the Lease.
(b) The Guarantors acknowledge, confirm and agree that: (i)
the Guarantors have the right, power and authority to enter into this Consent;
and (ii) the Hanover Guarantee is in full force and effect and enforceable in
accordance with its terms.
3. Consent. (a) The Lessee, as lessee under the Lease,
consents to the Assignment and each of the terms thereof, and agrees to pay and
deliver to the Assignee (or its designee) all Lease Rents and other sums payable
under the Lease without any offset, deduction, defense, abatement, deferment,
diminution or counterclaim, and the Lessee will not assert any offset,
deduction, defense (other than the defense of payment to the Assignee (or its
designee)), abatement, deferment, diminution or counterclaim in any proceeding
brought under the Assignment or with respect to the transactions contemplated
therein or herein. The Lessee will not, for any reason whatsoever, seek to
recover from the Assignee (or its designee) any moneys paid to the Assignee (or
its designee) by virtue of the Assignment. Lessee agrees (i) to deliver to the
Assignee (or its designee) and the Assignor, at their addresses provided in the
Participation Agreement or at such other addresses as the Assignee or the
Assignor, as the case may be, may designate, duplicate original or copies of all
notices, undertakings, demands, statements, documents and other communications
which the Lessee is required or permitted to deliver pursuant to the Lease or
the Assignment; (ii) that, subject to the Excepted Rights, any notice delivered
or declaration made to the Lessee by the Assignee (or its designee) pursuant to
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the Lease shall be effective as a notice given or declaration made to the Lessee
by the Assignor as lessor under the Lease; (iii) that the Assignee (and its
designee) shall not by reason of the Assignment be subject to any liability or
obligation under the Lease; and (iv) that, subject to the Excepted Rights, any
waiver, consent or approval by the Assignor under the Lease shall not be valid
unless approved in writing by the Assignee (or its designee).
(b) The Guarantors consent to the Assignment and each of the
terms thereof, and agrees to pay and deliver to the Assignee (or its designee)
the Guaranteed Obligations, subject to the Excepted Rights, and other sums
payable under the Hanover Guarantee without any offset, deduction, defense,
abatement, deferment, diminution or counterclaim, and the Guarantors will not
assert any offset, deduction, defense (other than the defense of payment to the
Assignee (or its designee)), abatement, deferment, diminution or counterclaim in
any proceeding brought under the Assignment or with respect to the transactions
contemplated therein or herein. The Guarantors will not, for any reason
whatsoever, seek to recover from the Assignee (or its designee) any moneys paid
to the Assignee (or its designee) by virtue of the Assignment.
(c) Subject to the Excepted Rights, the Lessee shall cause the
Lease Rents and other sums payable to the Assignor under the Lease to be
delivered to the Assignee (or its designee), as Collateral Agent under the
Indenture, as an absolute net sum, in such manner that the Assignee (or its
designee) shall have "collected funds" on the date and at the time payments are
due under the Lease.
(d) The Guarantors shall cause the Guaranteed Obligations,
subject to the Excepted Rights, and other sums payable to the Assignor under the
Hanover Guarantee to be delivered to the Assignee (or its designee), as
Collateral Agent under the Indenture, at its address set forth in Section 14.3
of the Participation Agreement.
(e) The Lessee hereby agrees to remain obligated under the
Lease and this Consent in accordance with their respective terms, and to take no
action to terminate (except in accordance with the express terms of the Lease),
annul, rescind or avoid the Lease or this Consent or to xxxxx, reduce, offset,
suspend or defer or make any counterclaim or raise any defense (other than the
defense of payment to the Assignee (or its designee)) with respect to the Lease
Rents payable thereunder or to cease paying such Lease Rents to the Assignee (or
its designee) as provided herein.
(f) The Guarantors hereby agree to remain obligated under the
Hanover Guarantee and this Consent in accordance with their respective terms,
and to take no action to terminate (except in accordance with the express terms
of the Hanover Guarantee), annul, rescind or avoid the Hanover Guarantee or this
Consent or to xxxxx, reduce, offset, suspend or defer or make any counterclaim
or raise any defense (other than the defense of payment to the Assignee (or its
designee)) with respect to the Guaranteed Obligations payable thereunder.
(g) The Lessee and the Guarantors hereby agree that upon the
occurrence of a Default or an Event of Default, the Assignee (or its designee)
shall have the right to deliver a
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notice of such default and make demand for payment under the Hanover Guarantee,
which shall be effective for all purposes as if sent by the Assignor.
(h) The Lessee shall notify the Assignee (or its designee) at
its address specified in the Participation Agreement, or such other address as
the Assignee may designate, of any Lease Event of Default and agrees that no
such default shall entitle the Lessee to terminate, annul, rescind or avoid the
Lease or reduce or xxxxx the Lease Rents or other sums payable thereunder.
4. Amendment or Termination; Assignee's Designation. (a)
The Lessee agrees that it will not, unilaterally or by agreement, subordinate,
amend, supplement, modify, extend (except in accordance with the express terms
of the Lease), discharge, waive or terminate (except in accordance with the
express terms of the Lease) the Lease or this Consent or any provision of any
thereof without the Assignee' s prior written consent, which consent may be
withheld in the Assignee's sole discretion, and that any attempted
subordination, amendment, supplement, modification, extension, discharge, waiver
or termination without such consent shall be null and void. In the event that
the Lease shall be amended or supplemented as herein permitted, the Lease, as so
amended or supplemented, shall continue to be subject to the provisions of the
Assignment and this Consent without the necessity of any further act by any of
the parties hereto. Nothing in this Section 4 shall be construed as limiting or
otherwise affecting in any way the Assignor's Excepted Rights or Shared Rights.
(b) The Guarantors agree that they will not, unilaterally or
by agreement, subordinate, amend, supplement, modify, extend (except in
accordance with the express terms of the Hanover Guarantee), discharge, waive or
terminate (except in accordance with the express terms of the Hanover Guarantee)
the Hanover Guarantee or this Consent or any provision of any thereof without
the Assignee's prior written consent, which consent may be withheld in the
Assignee's sole discretion, and that any attempted subordination, amendment,
supplement, modification, extension, discharge, waiver or termination without
such consent shall be null and void. In the event that the Hanover Guarantee
shall be amended or supplemented as herein permitted, the Hanover Guarantee, as
so amended or supplemented, shall continue to be subject to the provisions of
the Assignment and this Consent without the necessity of any further act by any
of the parties hereto. Nothing in this Section 4 shall be construed as limiting
or otherwise affecting in any way the Assignor's Excepted Rights or Shared
Rights.
5. Continuing Obligations of the Assignor and the
Lessee. Neither the execution and delivery of the Assignment, nor any action or
inaction on the part of the Assignee shall impair or diminish any obligations of
the Assignor or the Lessee under the Lease or the Guarantors under the Hanover
Guarantee, and shall not impose on the Assignee (or its designee) any such
obligations, nor shall it impose on the Assignee (or its designee) a duty to
produce Rents or cause the Assignee to be a mortgagee in possession for any
purpose.
6. Severability. If any provision or provisions, or if
any portion of any provision or provisions, in this Consent is found by a court
of law of competent jurisdiction to be in violation of any local, state or
Federal ordinance, statute, law, administrative or judicial
4
decision, or public policy, and if such court should declare such portion,
provision or provisions to be illegal, invalid, unlawful, void or unenforceable
as written, then it is the intent of the Lessee that such portion, provision or
provisions shall be given force to the fullest possible extent that they are
legal, valid and enforceable, that the remainder of this Consent shall be
construed as if such illegal, invalid, unlawful, void or unenforceable portion,
provision or provisions were not contained herein, and that the obligations of
the Lessee under the remainder of this Consent shall continue in full force and
effect.
7. Governing Law. THIS CONSENT SHALL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
EXCEPT AS TO MATTERS RELATING TO THE CREATION OF LIENS AND THE EXERCISE OF
REMEDIES WITH RESPECT THERETO, WHICH SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE IN WHICH THE EQUIPMENT IS LOCATED.
5
IN WITNESS WHEREOF, the Lessee and the Guarantors have caused
this Consent to be duly executed as of the date first written above.
HANOVER COMPRESSION LIMITED PARTNERSHIP,
as Lessee
By:
--------------------------------------
Name:
Title:
HANOVER COMPRESSOR COMPANY, as a
Guarantor
By:
--------------------------------------
Name:
Title:
HANOVER APPLIED PROCESS SOLUTIONS, INC.,
as a Guarantor
By:
--------------------------------------
Name:
Title:
EUREKA ENERGY LIMITED PARTNERSHIP, as a
Guarantor
By:
--------------------------------------
Name:
Title:
HANOVER ACQUISITION LIMITED PARTNERSHIP,
as a Guarantor
By:
--------------------------------------
Name:
Title:
6
HANOVER COMPRESSOR LIMITED HOLDINGS LLC,
as a Guarantor
By:
--------------------------------------
Name:
Title:
HANOVER LAND LIMITED PARTNERSHIP, as a
Guarantor
By:
--------------------------------------
Name:
Title:
HANOVER MAINTECH LIMITED PARTNERSHIP, as
a Guarantor
By:
--------------------------------------
Name:
Title:
HANOVER/XXXXX LIMITED PARTNERSHIP, as a
Guarantor
By:
--------------------------------------
Name:
Title:
HANOVER OEC COMPRESSION CORPORATION, as a
Guarantor
By:
--------------------------------------
Name:
Title:
PRODUCTION OPERATORS CORPORATION, as a
Guarantor
By:
--------------------------------------
Name:
Title:
7
PRODUCTION OPERATORS, INC., as a
Guarantor
By:
--------------------------------------
Name:
Title:
For purposes of Section 5 hereof:
HANOVER EQUIPMENT TRUST 2001B
By: Wilmington Trust Company, not in
its individual capacity but solely
as Trustee
By:
--------------------------------------
Name:
Title:
