[EXECUTION COPY]
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MASTER LEASE AND DEED OF TRUST,
DEED TO SECURE DEBT AND
MORTGAGE
Dated as of December 15, 2004
between
itt industries, inc.,
as Lessee
and
REXUS L.L.C.,
as Lessor
-----------------------------------------------
To the extent, if any, that this Master Lease and Deed of Trust, Deed to
Secure Debt and Mortgage constitutes chattel paper (as such term is defined in
the Uniform Commercial Code as in effect in any applicable jurisdiction), no
lien on this Master Lease and Deed of Trust, Deed to Secure Debt and Mortgage
may be created through the transfer or possession of any counterpart other than
the original counterpart containing the receipt therefor executed by the Lessor
on or following the signature page hereof.
This counterpart is not the original counterpart.
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ARTICLE I DEFINITIONS................................................. 1
Section 1.1. Definitions; Interpretation.............................. 1
ARTICLE II MASTER LEASE................................................ 2
Section 2.1. Acceptance and Lease of Leased Properties................ 2
Section 2.2. Acceptance Procedure..................................... 2
Section 2.3. Lease Term............................................... 2
Section 2.4. Title.................................................... 2
ARTICLE III PAYMENT OF RENT............................................. 2
Section 3.1. Rent..................................................... 2
Section 3.2. Payment of Rent.......................................... 3
Section 3.3. Supplemental Rent........................................ 3
Section 3.4. Method of Payment........................................ 3
Section 3.5. Calculation of Accrual Rent.............................. 3
ARTICLE IV QUIET ENJOYMENT; RIGHT TO INSPECT........................... 4
Section 4.1. Quiet Enjoyment.......................................... 4
Section 4.2. Right to Inspect......................................... 4
ARTICLE V NET LEASE, ETC.............................................. 4
Section 5.1. Net Lease................................................ 4
Section 5.2. No Termination or Abatement.............................. 5
ARTICLE VI SUBLEASES AND ASSIGNMENTS................................... 5
Section 6.1. General.................................................. 5
Section 6.2. Leasing and Subleasing................................... 5
ARTICLE VII LESSEE ACKNOWLEDGMENTS...................................... 6
Section 7.1. Condition of the Property................................ 6
Section 7.2. Risk of Loss............................................. 6
ARTICLE VIII POSSESSION AND USE OF EACH PROPERTY, ETC.................... 6
Section 8.1. Utility Charges.......................................... 6
Section 8.2. Possession and Use of each Property; No Waste............ 6
Section 8.3. Compliance with Applicable Laws and
Insurance Requirements................................ 7
ARTICLE IX MAINTENANCE AND REPAIR; RETURN.............................. 7
Section 9.1. Maintenance and Repair................................... 7
Section 9.2. No Maintenance Obligations of Lessor..................... 7
Section 9.3. Condition Upon Return.................................... 7
ARTICLE X MODIFICATIONS, ETC.......................................... 7
Section 10.1. Modifications, Substitutions and Replacement............. 7
Master Lease
Section 10.2. Notice to the Lessor..................................... 8
ARTICLE XI DISCHARGE OF LIENS; EASEMENTS............................... 8
Section 11.1. Discharge of Liens....................................... 8
Section 11.2. Grants and Releases of Easements; Lessor Waivers......... 9
ARTICLE XII PERMITTED CONTESTS.......................................... 10
Section 12.1. Permitted Contests....................................... 10
ARTICLE XIII INSURANCE................................................... 10
Section 13.1. General.................................................. 10
Section 13.2. Insurance Coverage....................................... 11
ARTICLE XIV CASUALTY AND CONDEMNATION; ENVIRONMENTAL MATTERS............ 12
Section 14.1. Risk of Loss, Damage or Destruction...................... 12
Section 14.2. Casualty and Condemnation................................ 13
Section 14.3. Remediation of Environmental Violations.................. 14
Section 14.4. Notice of Environmental Violations....................... 15
ARTICLE XV PARTIAL Termination of Lease AT LESSOR'S OPTION............. 15
Section 15.1. Partial Termination Upon Certain Events.................. 15
Section 15.2. Partial Termination Procedures........................... 15
ARTICLE XVI LEASE EVENTS OF DEFAULT..................................... 16
Section 16.1. Lease Events of Default.................................. 16
Section 16.2. Remedies................................................. 18
Section 16.3. Waiver of Certain Rights................................. 21
Section 16.4. Mortgage/Deed of Trust Remedies.......................... 21
ARTICLE XVII LESSOR'S RIGHT TO CURE; LESSOR'S
OBLIGATION TO FORWARD NOTICES.......... 22
Section 17.1. The Lessor's Right to Cure the Lessee's Lease Defaults... 22
Section 17.2. Lessor's Obligation to Forward Notices................... 22
ARTICLE XVIII PURCHASE BY LESSEE.......................................... 22
Section 18.1. Purchase Option on Expiration Date....................... 22
Section 18.2. Acceleration of Purchase Obligation...................... 23
ARTICLE XIX TERMINATION OR REPLACEMENT FOR OBSOLESCENCE,
EVENT OF LOSS, ETC....................................... 23
Section 19.1. Right of Termination..................................... 23
Section 19.2. Replacement.............................................. 24
ARTICLE XX RETURN OPTION; RETURN PROVISIONs............................ 26
Section 20.1. Option to Return......................................... 26
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Master Lease
Section 20.2. Return................................................... 27
ARTICLE XXI PROCEDURES RELATING TO CONVEYANCE TO LESSEE................. 28
Section 21.1. Provisions Relating to the Conveyance of
Properties to the Lessee upon Certain Events........... 28
ARTICLE XXII ESTOPPEL CERTIFICATES....................................... 29
Section 22.1. Estoppel Certificates.................................... 29
ARTICLE XXIII ACCEPTANCE OF SURRENDER..................................... 29
Section 23.1. Acceptance of Surrender.................................. 29
ARTICLE XXIV NO MERGER OF TITLE.......................................... 29
Section 24.1. No Merger of Title....................................... 29
ARTICLE XXV INTENT OF THE PARTIES....................................... 30
Section 25.1. Ownership of the Property................................ 30
ARTICLE XXVI MISCELLANEOUS............................................... 30
Section 26.1. Severability............................................. 30
Section 26.2. Amendments and Modifications............................. 31
Section 26.3. No Waiver................................................ 31
Section 26.4. Notices.................................................. 31
Section 26.5. Successors and Assigns................................... 31
Section 26.6. Headings and Table of Contents........................... 31
Section 26.7. Counterparts............................................. 31
Section 26.8. GOVERNING LAW............................................ 31
Section 26.9. Original Lease........................................... 31
Section 26.10. Time of Essence.......................................... 31
Section 26.11. Liability Limited........................................ 31
APPENDIX A -- Definitions
SCHEDULE I -- Fixed Rent Schedule
EXHIBIT A -- Form of Lease Supplement
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MASTER LEASE AND DEED OF TRUST, DEED TO SECURE DEBT AND MORTGAGE
THIS MASTER LEASE AND DEED OF TRUST, DEED TO SECURE DEBT AND MORTGAGE (as
amended, supplemented, amended and restated or otherwise modified from time to
time, this "Master Lease"), dated as of December 15, 2004, among ITT INDUSTRIES,
INC., an Indiana corporation (the "Lessee"), as Lessee and whose principal
offices are located at 0 Xxxx Xxx Xxx Xxxx, Xxxxx Xxxxxx, Xxx Xxxx 00000, and
REXUS L.L.C., a Delaware limited liability company (the "Lessor"), as Lessor and
whose principal offices are located at c/o Societe Generale (Canada), as Lessor
Administrator, 1501 XxXxxx College, Bureau 0000, Xxxxxxxx, Xxxxxx, Xxxxxx X0X
0XX.
W I T N E S S E T H:
WHEREAS, pursuant to a Participation Agreement dated as of the date hereof
(as amended, supplemented, amended and restated or otherwise modified from time
to time, the "Participation Agreement"), among ITT Industries, Inc., as the
Lessee, Rexus L.L.C., as the Lessor, and Air Bail S.A.S. and RBS Lombard, Inc.,
as Investors, the Investors and the Lessor have agreed to finance the
acquisition of the Leased Properties (including the payment of certain
Transaction Expenses in connection therewith);
WHEREAS, subject to the terms and conditions set forth in the
Participation Agreement, on the Acquisition Date the Lessor will purchase from
the Lessee or its Subsidiaries the real properties described on Schedule III to
the Participation Agreement under the heading "Leased Properties";
WHEREAS, the Lessor desires to lease to the Lessee, and the Lessee desires
to lease from the Lessor, the Leased Properties described in the Lease
Supplements;
WHEREAS, to secure the obligations of the Lessee under this Master Lease
and the other Operative Documents, the Lessee will grant to the Lessor a first
priority Lien on each Property (including each Mortgaged Property); and
WHEREAS, each Property will be subject to the terms of this Master Lease
and the Lease Supplement or Lessor Mortgage (as applicable) applicable thereto;
NOW, THEREFORE, in consideration of the foregoing, and of other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions; Interpretation . Capitalized terms used but not
otherwise defined in this Master Lease have the respective meanings specified in
Appendix A hereto; and the rules of interpretation set forth in Appendix A
hereto shall apply to this Master Lease.
Master Lease
ARTICLE II
MASTER LEASE
Section 2.1. Acceptance and Lease of Leased Properties. Subject to the
conditions set forth in the Participation Agreement, including the satisfaction
or waiver of the conditions set forth in Article VI thereof, the Lessor hereby
agrees to accept, pursuant to the terms of the Participation Agreement, (a)
delivery on the Acquisition Date of each real property described on Schedule III
to the Participation Agreement under the heading "Leased Properties" and all
Improvements located thereon and (b) delivery on each Replacement Date of each
Replacement Property and all Improvements thereon, and simultaneously to demise
and lease to the Lessee hereunder and under the Lease Supplements for the Lease
Term, the Lessor's interest in such Property or Properties (including any
Improvements which thereafter may be constructed on such Property in accordance
with this Master Lease), and the Lessee hereby agrees, expressly for the direct
benefit of the Lessor, to lease from the Lessor for the Lease Term the interest
of the Lessor in such Leased Properties together with any Improvements which
thereafter may be constructed on such Leased Properties in accordance with this
Master Lease.
Section 2.2. Acceptance Procedure. The Lessee hereby agrees that the
execution and delivery by it of a Lease Supplement on or as of the Acquisition
Date or a Replacement Date shall, without further act, constitute the
irrevocable acceptance by the Lessee of the Leased Property described in such
Lease Supplement for all purposes of this Master Lease and the other Operative
Documents on the terms set forth herein and therein, and that such Leased
Property, together with any Improvements constructed on the Property pursuant to
this Master Lease, shall be deemed to be included in the leasehold estate of
this Master Lease and shall be subject to the terms and conditions of this
Master Lease as of the Acquisition Date or such Replacement Date, as the case
may be.
Section 2.3. Lease Term. The Lease Term of this Master Lease for each
Leased Property shall commence on (and include) the Acquisition Date of such
Property (or, in the case of a Replacement Property, the Replacement Date for
such Property) and end on (but exclude) the Expiration Date.
Section 2.4. Title. Each Leased Property is leased to the Lessee without
any representation or warranty, express or implied, by the Lessor and subject to
the rights of parties in possession, the existing state of title (including all
Liens other than Lessor Liens) and all Applicable Law. The Lessee shall not in
any event have any recourse against the Lessor for any defect in or exception to
title to any Property or leasehold interest therein other than resulting from
Lessor Liens attributable to the Lessor.
Section 2.5. Mortgaged Properties Also Subject to this Master Lease. Each
of the Lessee and the Lessor hereby agrees that each Mortgaged Property shall be
subject to the terms of this Master Lease for the period commencing on (and
including) the Acquisition Date or Replacement Date for such Property and ending
on (but excluding) the date on which such Property is released from the Lien of
the applicable Lessor Mortgage in accordance with the terms of the Operative
Documents.
ARTICLE III
PAYMENT OF RENT
Section 3.1. Rent. (a) Accrual Rent shall accrue each day during the Lease
Term on the Aggregate Property Cost outstanding on such day. During the Lease
Term, the Lessee shall pay Basic Rent to the Lessor on each Scheduled Payment
Date, on any other date required under Section 20.1 in connection with the
Lessee's exercise of the Return Option, on any other date on which this Master
Lease or any other Operative Document requires such payment and, with respect to
any Leased Property, on any
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Master Lease
other date on which this Master Lease shall terminate with respect to such
Leased Property or with respect to any Mortgaged Property.
(b) Neither the Lessee's inability or failure to take possession of all or
any portion of any Leased Property when delivered by the Lessor, nor the
inability or failure of the Lessor to deliver all or any portion of any Leased
Property to the Lessee on or before the Acquisition Date, whether or not
attributable to any act or omission of the Lessee or any act or omission of the
Lessor, or for any other reason whatsoever, shall delay or otherwise affect such
Lessee's obligation to pay Rent for such Leased Property in accordance with the
terms of this Master Lease.
Section 3.2. Payment of Rent. Rent shall be paid absolutely net to each
Person entitled thereto, so that this Master Lease shall yield to such Person
the full amount thereof, without setoff, deduction or reduction.
Section 3.3. Supplemental Rent. The Lessee shall pay (x) to the Lessor or
(y) in the case of any Supplemental Rent owing to any other Person, directly to
the Person entitled thereto, any and all Supplemental Rent promptly as the same
shall become due and payable, and if the Lessee fails to pay any Supplemental
Rent, the Lessor and such other Persons shall have all rights, powers and
remedies provided for herein or by law or equity or otherwise in the case of
nonpayment of Basic Rent. The Lessee shall pay to the Lessor, as Supplemental
Rent, among other things, on demand, to the extent permitted by Applicable Law,
interest at the applicable Overdue Rate on any Basic Rent or Supplemental Rent
not paid when due for the period from the due date thereof until the same shall
be paid (provided, that any amounts payable by the Lessee pursuant to Article
XIII of the Participation Agreement shall accrue interest as set forth in
Section 13.11 of the Participation Agreement). The expiration or other
termination of the Lessee's obligations to pay Basic Rent hereunder shall not
limit or modify the obligations of the Lessee with respect to Supplemental Rent.
Unless expressly provided otherwise in this Master Lease or in the Participation
Agreement, in the event of any failure on the part of the Lessee to pay and
discharge any Supplemental Rent as and when due, the Lessee shall also promptly
pay and discharge, to the extent incurred as a result of such failure on the
part of the Lessee, any fine, penalty, interest or cost which may be assessed or
added against the Lessor or any Investor by a third party for nonpayment or late
payment of such Supplemental Rent, all of which shall also constitute
Supplemental Rent. Notwithstanding anything in this Section 3.3 to the contrary,
if the Lessee incurs any fine, penalty, interest or cost for nonpayment or late
payment of any tax assessment, levy, duty, or other xxxx received in connection
with any of the Leased Properties as a result of the Lessor's failure to provide
notice to the Lessee of such tax assessment, levy, duty or other xxxx within the
time period required by Section 17.2, an amount equal to such fine, penalty,
interest or cost shall be deducted first from any Supplemental Rent then due and
owing and second from any Accrual Rent then due and owing.
Section 3.4. Method of Payment. Each payment of Rent payable by the Lessee
to the Lessor under this Lease or any other Operative Document shall be made by
the Lessee to the Lessor prior to 10:00 a.m., New York City time to the Account
in immediately available funds consisting of lawful currency of the United
States of America on the date when such payment shall be due. Payments received
after 10:00 a.m., New York City time on the date due shall for the purpose of
Section 16.1 hereof be deemed received on such day; provided, however, that for
the purposes of the second sentence of Section 3.3, such payments shall be
deemed received on the next succeeding Business Day and shall accrue interest at
the Overdue Rate as provided in such Section 3.3.
Section 3.5. Calculation of Accrual Rent. The "Accrual Rent" payable on
any Scheduled Payment Date means an amount equal to (w) the Aggregate Property
Cost outstanding on the immediately preceding Scheduled Payment Date, after
giving effect to all payments made on such preceding Scheduled Payment Date (or,
in the case of the initial Scheduled Payment Date, the Aggregate Property
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Master Lease
Cost outstanding on the Acquisition Date) minus all payments of Termination Base
Amount made during the Rent Period ending on such Scheduled Payment Date
multiplied by (x) the Applicable Rate multiplied by (y) the number of days then
elapsed since the Scheduled Payment Date immediately preceding such date
multiplied by (z) 1/360.
ARTICLE IV
QUIET ENJOYMENT; RIGHT TO INSPECT
Section 4.1. Quiet Enjoyment. Subject to the terms of each of the
Operative Documents, the Lessee shall peaceably and quietly have, hold and enjoy
each Property for the Lease Term, free of any claim or other action by the
Lessor or anyone claiming by, through or under the Lessor with respect to any
matters arising from and after the Acquisition Date. Such right of quiet
enjoyment is independent of, and shall not affect the rights of the Lessor or
any assignee thereof otherwise to initiate legal action to enforce, the
obligations of the Lessee under this Master Lease.
Section 4.2. Right to Inspect. During the Lease Term, the Lessee shall
permit the Lessor, the Investors and their agent and representatives to inspect
the Properties in accordance with Section 10.1(j) of the Participation
Agreement.
ARTICLE V
NET LEASE, ETC.
Section 5.1. Net Lease. This Master Lease shall constitute a net lease.
Any present or future law to the contrary notwithstanding, this Master Lease
shall not terminate, nor shall the Lessee be entitled to any abatement,
suspension, deferment, reduction, setoff, counterclaim, or defense with respect
to the Rent, nor shall the obligations of the Lessee hereunder be affected
(except as expressly herein permitted and by performance of the obligations in
connection therewith) by reason of: (i) any defect in the condition,
merchantability, design, construction, quality or fitness for use of any
Property or any part thereof, or the failure of any Property to comply with all
Applicable Law, including any inability to occupy or use any Property by reason
of such non-compliance; (ii) any damage to, removal, abandonment, salvage, loss,
contamination of or Release from, scrapping or destruction of or any requisition
or taking of any Property or any part thereof; (iii) any restriction, prevention
or curtailment of or interference with the construction on or any use of any
Property or any part thereof including eviction; (iv) any defect in title of or
rights to any Property or any Lien on such title or rights or on any Property
(other than Lessor Liens); (v) any change, waiver, extension, indulgence or
other action or omission or breach in respect of any obligation or liability of
or by the Lessor, any Investor or the Arranger; (vi) any bankruptcy, insolvency,
reorganization, composition, adjustment, dissolution, liquidation or other like
proceedings relating to the Lessee, any Lessee Subsidiary, the Lessor, any
Investor, the Arranger or any other Person, or any action taken with respect to
this Master Lease by any trustee or receiver of the Lessee, any Lessee
Subsidiary, the Lessor, any Investor, the Arranger or any other Person, or by
any court in any such proceeding; (vii) any claim that the Lessee has or might
have against any Person, including the Lessor, any Investor, the Arranger or any
Seller, vendor, manufacturer, contractor of or for any Property; (viii) any
failure on the part of the Lessor to perform or comply with any of the terms of
this Master Lease (other than performance by the Lessor of its obligations set
forth in Section 2.1 hereof), of any other Operative Document or of any other
agreement; (ix) any invalidity or unenforceability or illegality or
disaffirmance of this Master Lease against or by the Lessee or any provision
hereof or any of the other Operative Documents or any provision of any thereof;
(x) the impossibility or illegality of performance by the Lessee, the Lessor or
both of them; (xi) any action by any court, administrative agency or other
Governmental Authority; or (xii) any other cause or circumstances whether
similar or
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Master Lease
dissimilar to the foregoing and whether or not the Lessee shall have notice or
knowledge of any of the foregoing. The Lessee's agreement in this Section 5.1
shall not affect any claim, action or right the Lessee may have against the
Lessor or any Investor. The parties intend that the obligations of the Lessee
hereunder shall be covenants and agreements that are separate and independent
from any obligations of the Lessor hereunder or under any other Operative
Documents, and the obligations of the Lessee shall continue unaffected unless
such obligations shall have been modified or terminated in accordance with an
express provision of this Master Lease.
Section 5.2. No Termination or Abatement. The Lessee shall remain
obligated under this Master Lease in accordance with its terms and shall not
take any action to terminate, rescind or avoid this Master Lease (except as
provided herein), notwithstanding any action for bankruptcy, insolvency,
reorganization, liquidation, dissolution, or other proceeding affecting the
Lessor or any Investor, or any action with respect to this Master Lease which
may be taken by any trustee, receiver or liquidator of the Lessor or any
Investor or by any court with respect to the Lessor or any Investor. The Lessee
hereby waives, to the extent permitted by Applicable Law, all right (i) to
terminate or surrender this Master Lease (except as provided herein) or (ii) to
avail itself of any abatement, suspension, deferment, reduction, setoff,
counterclaim or defense with respect to any Rent except as otherwise provided in
the last sentence of Section 3.3. The Lessee shall remain obligated under this
Master Lease in accordance with its terms and the Lessee hereby waives, to the
extent permitted by Applicable Law, any and all rights now or hereafter
conferred by statute or otherwise to modify or to avoid strict compliance with
its obligations under this Master Lease. Notwithstanding any such statute or
otherwise, the Lessee shall be bound by all of the terms and conditions
contained in this Master Lease, each Lease Supplement and each Lessor Mortgage.
ARTICLE VI
SUBLEASES AND ASSIGNMENTS
Section 6.1. General. THE LESSEE SHALL NOT, WITHOUT THE PRIOR WRITTEN
CONSENT OF THE LESSOR (SUCH CONSENT TO BE GIVEN OR WITHHELD IN THE SOLE
DISCRETION OF THE LESSOR), TRANSFER, ASSIGN OR ENCUMBER THIS MASTER LEASE OR ANY
LEASE SUPPLEMENT OR ANY OF ITS RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER,
SUBLEASE ANY LEASED PROPERTY OR ANY PART THEREOF OR LEASE ANY MORTGAGED PROPERTY
OR ANY PART THEREOF EXCEPT, IN EACH CASE, AS PERMITTED BY SECTION 6.2, AND ANY
SUCH TRANSFER, ASSIGNMENT, ENCUMBRANCE, SUBLEASE OR LEASE THAT IS NOT PERMITTED
BY SECTION 6.2 AND MADE WITHOUT SUCH WRITTEN CONSENT THERETO SHALL BE NULL AND
VOID.
Section 6.2. Leasing and Subleasing. The Lessee may lease or sublease (as
applicable) any Property or any portion thereof to any Person; provided,
however, that: (a) no lease, sublease or other relinquishment of possession of
any Property shall in any way discharge or diminish any of the Lessee's
obligations to the Lessor hereunder and the Lessee shall remain directly and
primarily liable under this Master Lease and the Lease Supplement; (b) each
lease or sublease of a Property shall expressly be made subject to and
subordinate to this Master Lease, any applicable Lease Supplement and any Lessor
Mortgage and to the rights of the Lessor hereunder and thereunder; (c) each
lease or sublease (as applicable) of a Property shall expressly provide for the
surrender of the Property or portion thereof by the applicable sublessee at the
election of the Lessor after the occurrence of a Lease Event of Default; (d)
unless the Lessor otherwise consents in writing (such consent to be given or
withheld in the sole discretion of the Lessor), each lease or sublease (as
applicable) shall expressly provide for termination prior to the Expiration
Date; (e) the use or uses under any lease or sublease (as applicable) shall be
such that they shall not impair the value or utility of such Property or violate
any Applicable Law or Insurance
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Master Lease
Requirement; and (f) the Lessee shall not lease or sublease (as applicable) any
Property or any portion thereof to any Person (i) that is named as a "specially
designated national and blocked person" on the most current list published by
the United States Department of the Treasury's Office of Foreign Assets Control
at its official website or any replacement website or other replacement official
publication of such list or (ii) that is listed in the annex to, or otherwise
subject to the provisions of, Executive Order No. 13224 on Terrorist Financing,
effective September 24, 2001. The Lessee shall, upon the request of the Lessor
from time to time, furnish to the Lessor a list of all leases and subleases
affecting the Properties, specifying the name and address of each applicable
lessee or sublessee, the identity of the Property affected, the current term and
expiration date of the applicable lessee or sublease and the terms of any
renewal options under the applicable lease or sublease.
ARTICLE VII
LESSEE ACKNOWLEDGMENTS
Section 7.1. Condition of the Property. THE LESSEE ACKNOWLEDGES AND AGREES
THAT ALTHOUGH THE LESSOR WILL OWN AND HOLD TITLE TO THE IMPROVEMENTS RELATING TO
EACH LEASED PROPERTY, THE LESSEE IS SOLELY RESPONSIBLE FOR THE DESIGN,
DEVELOPMENT, BUDGETING AND CONSTRUCTION OF THE IMPROVEMENTS AND ANY ALTERATIONS
OR MODIFICATIONS. THE LESSEE FURTHER ACKNOWLEDGES AND AGREES THAT IT IS LEASING
EACH LEASED PROPERTY "AS IS" WITHOUT REPRESENTATION, WARRANTY OR COVENANT
(EXPRESS OR IMPLIED) BY THE LESSOR OR ANY INVESTOR AND IN EACH CASE SUBJECT TO
(A) THE EXISTING STATE OF TITLE (EXCLUDING LESSOR LIENS), (B) THE RIGHTS OF ANY
PARTIES IN POSSESSION THEREOF, (C) ANY STATE OF FACTS WHICH AN ACCURATE SURVEY
OR PHYSICAL INSPECTION MIGHT SHOW AND (D) VIOLATIONS OF APPLICABLE LAW WHICH MAY
EXIST ON THE DATE HEREOF OR ON THE ACQUISITION DATE. NEITHER THE LESSOR NOR ANY
INVESTOR HAS MADE OR SHALL BE DEEMED TO HAVE MADE ANY REPRESENTATION, WARRANTY
OR COVENANT (EXPRESS OR IMPLIED) OR SHALL BE DEEMED TO HAVE ANY LIABILITY
WHATSOEVER AS TO THE TITLE (OTHER THAN FOR LESSOR LIENS ATTRIBUTABLE TO THE
LESSOR), VALUE, SUITABILITY, USE, CONDITION, DESIGN, OPERATION, OR FITNESS FOR
USE OF ANY LEASED PROPERTY (OR ANY PART THEREOF), OR ANY OTHER REPRESENTATION,
WARRANTY OR COVENANT WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO ANY LEASED
PROPERTY (OR ANY PART THEREOF) AND NEITHER THE LESSOR NOR ANY INVESTOR NOR THE
ARRANGER SHALL BE LIABLE FOR ANY LATENT, HIDDEN, OR PATENT DEFECT THEREIN (OTHER
THAN FOR LESSOR LIENS ATTRIBUTABLE TO THE LESSOR OR SUCH INVESTOR) OR THE
FAILURE OF ANY LEASED PROPERTY, OR ANY PART THEREOF, TO COMPLY WITH ANY
APPLICABLE LAW.
Section 7.2. Risk of Loss. During the Lease Term the risk of loss of or
decrease in the enjoyment and beneficial use of each Property as a result of the
damage or destruction thereof by fire, the elements, casualties, thefts, riots,
wars or otherwise is assumed by the Lessee, and the Lessor shall not in any
event be answerable or accountable therefor.
ARTICLE VIII
POSSESSION AND USE OF EACH PROPERTY, ETC.
Section 8.1. Utility Charges. The Lessee shall pay or cause to be paid all
charges for electricity, power, gas, oil, water, telephone, sanitary sewer
service and all other rents and utilities used in or on each Property during the
Lease Term. The Lessee shall be entitled to receive any credit or refund
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Master Lease
with respect to any utility charge paid by the Lessee and the amount of any
credit or refund received by the Lessor on account of any utility charges paid
by the Lessee, net of the costs and expenses reasonably incurred by the Lessor
in obtaining such credit or refund, shall be promptly paid over to the Lessee.
Section 8.2. Possession and Use of each Property; No Waste. The Lessee
covenants that each Property will be used solely for the intended purpose
thereof and applying standards of use no lower than the standards applied by the
Lessee and its Affiliates for other comparable properties owned or leased by the
Lessee or its Affiliates. The Lessee shall pay, or cause to be paid, all charges
and costs required in connection with the use of the Properties as contemplated
by this Master Lease and each Lease Supplement. The Lessee shall not commit or
permit any waste of any Property or any part thereof.
Section 8.3. Compliance with Applicable Laws and Insurance Requirements.
Subject to the terms of Article XII relating to permitted contests, the Lessee,
at its sole cost and expense, shall (a) comply in all material respects with all
Applicable Laws (including all Environmental Laws) and Insurance Requirements
relating to each Property, including the use, construction, operation,
maintenance, repair and restoration thereof and the return thereof pursuant to
Article XX, whether or not such compliance shall require structural or
extraordinary changes in the Improvements or interfere with the use and
enjoyment of each Property, and (b) procure, maintain and comply with all
licenses, permits (including Environmental Permits), orders, approvals, consents
and other authorizations required for the construction, use, maintenance and
operation of each Property and for the use, operation, maintenance, repair and
restoration of the Improvements.
ARTICLE IX
MAINTENANCE AND REPAIR; RETURN
Section 9.1. Maintenance and Repair. The Lessee, at its sole cost and
expense, shall maintain each Property in good condition (ordinary wear and tear
excepted) and make all necessary repairs thereto, of every kind and nature
whatsoever, whether ordinary or extraordinary or foreseen or unforeseen, in each
case as required by all Applicable Law and Insurance Requirements and in no
event applying standards of maintenance and repair lower than the standards
applied by the Lessee in the operation and maintenance and repair of other
comparable properties owned or leased by the Lessee or its Affiliates.
Section 9.2. No Maintenance Obligations of Lessor. The Lessor shall not
under any circumstances be required to build any improvements on any Property,
make any repairs, replacements, alterations or renewals of any nature or
description to any Property, make any expenditure whatsoever in connection with
this Master Lease or the Lease Supplements (other than for Property Costs paid
by the Lessor with respect to the Leased Properties in accordance with and
pursuant to the terms of the Participation Agreement) or maintain any Property
in any way. The Lessee waives any right to (i) require the Lessor to maintain,
repair, or rebuild all or any part of any Property or (ii) make repairs at the
expense of the Lessor pursuant to any Applicable Law, Insurance Requirement,
contract, agreement, or covenant, condition or restriction in effect at any time
during the Lease Term.
Section 9.3. Condition Upon Return. The Lessee shall, upon the expiration
or earlier termination of this Master Lease with respect to each Leased Property
(other than as a result of the Lessee's purchase of such Property from the
Lessor as provided herein), vacate and surrender such Property to the Lessor in
the condition such Property is required to be maintained in accordance with the
Operative Documents.
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ARTICLE X
MODIFICATIONS, ETC.
Section 10.1. Modifications, Substitutions and Replacement. During the
Lease Term, the Lessee, at its sole cost and expense, (x) shall make or cause to
be made all alterations, renovations, improvements and additions to each
Property or any part thereof (collectively, "Modifications") that are required
to be made pursuant to Applicable Law or Insurance Requirements (a "Required
Modification") and (y) may at any time make Modifications to any Property or any
part thereof; provided, however, that:
(a) except for any Required Modification, no Modification shall be
made if it would materially and adversely affect the marketability, Fair
Market Sales Value, utility or residual value of such Property or any part
thereof;
(b) the Modification shall be done in a good and workmanlike manner;
(c) the Modification shall comply with all Insurance Requirements
and shall comply in all material respects with all Applicable Law
applicable to the Modification, including the obtaining of any necessary
permits;
(d) subject to the terms of Article XII relating to permitted
contests, the Lessee shall pay all costs and expenses and shall discharge
(or cause to be insured or bonded over) within sixty (60) days after the
same shall be filed (or otherwise become effective) any Liens arising with
respect to the Modification;
(e) such Modifications shall comply with Sections 8.3 and 9.1; and
(f) The Lessee shall be required to obtain the prior written
approval (which approval shall not be unreasonably withheld) of the Lessor
with respect to any Modifications that shall cost in excess of $3,000,000
in the aggregate if a building permit is required in connection therewith.
All Modifications shall remain part of the realty. Title to all
Modifications made with respect to any Leased Property shall immediately vest in
the Lessor and be subject to this Master Lease and the Lease Supplement for the
applicable Property; provided, however, that Modifications that (x) are not
Required Modifications, (y) were not financed or otherwise paid for by the
Lessor, and (z) can be removed without causing (A) material damage to any
Property, (B) any diminution in the Fair Market Sales Value of any Property or
the remaining useful life of the Property, or (C) any impairment in the utility
or residual value of any Property, shall be the property of the Lessee or other
third party and may be removed by the Lessee during the Lease Term and shall not
be subject to this Master Lease or any Lease Supplement. The Lessee may place
upon any Property any trade fixtures, machinery, equipment, inventory or other
property belonging to the Lessee or third parties and may remove the same,
subject, however, to the terms of Section 9.1; provided, however, that such
trade fixtures, machinery, equipment, inventory or other property can be removed
without causing damage to the Property, reduction of the Fair Market Sales Value
of the Property or any diminution in the remaining useful life of the Property
or any impairment in the utility or residual value of the Property.
Section 10.2. Notice to the Lessor. If the Lessee reasonably expects the
cost of any Modification to exceed the greater of $1,000,000 in the aggregate
and five percent (5%) of the Termination Base Amount of the relevant Property,
the Lessee shall deliver to the Lessor a brief written narrative of the work to
be performed in connection with such Modification prior to making such
Modification.
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Master Lease
ARTICLE XI
DISCHARGE OF LIENS; EASEMENTS
Section 11.1. Discharge of Liens. (a) The Lessee agrees that except as
otherwise provided herein and subject to the terms of Article XII relating to
permitted contests, the Lessee shall not directly or indirectly create or allow
to remain, and shall promptly (and in any event within sixty (60) days after
notice thereof is received by the Lessee from any Person) discharge at its sole
cost and expense, any Lien (other than any Lessor Lien), defect, attachment,
levy, title retention agreement or claim upon any Property or any Lien,
attachment, levy or claim with respect to any Basic Rent, Supplemental Rent or
amounts held by the Lessor pursuant to this Master Lease as collateral security
for the Lessee's obligations or pending performance by the Lessee, other than
Permitted Property Liens.
(a) Nothing contained in this Master Lease shall be construed as
constituting the consent or request of the Lessor or any Investor, expressed or
implied, to or for the performance by any contractor, mechanic, laborer,
materialman, supplier or vendor of any labor or services or for the furnishing
of any materials for any construction, alteration, addition, repair or
demolition of or to any Property or any part thereof. NOTICE IS HEREBY GIVEN
THAT NEITHER THE LESSOR NOR ANY INVESTOR IS OR SHALL BE LIABLE FOR ANY LABOR,
SERVICES OR MATERIALS FURNISHED OR TO BE FURNISHED TO THE LESSEE, OR TO ANYONE
HOLDING ANY PROPERTY OR ANY PART THEREOF THROUGH OR UNDER THE LESSEE, AND THAT
NO MECHANIC'S OR OTHER LIENS FOR ANY SUCH LABOR, SERVICES OR MATERIALS SHALL
ATTACH TO OR AFFECT THE INTEREST OF THE LESSOR OR ANY INVESTOR IN AND TO ANY
PROPERTY.
Section 11.2. Grants and Releases of Easements; Lessor Waivers. So long as
no Lease Event of Default shall have occurred and be continuing and subject to
the provisions of Sections 8.2, 8.3, 9.1, 10.1 and 11.1 hereof, the Lessor
hereby consents in each instance to the following actions by the Lessee at the
Lessee's sole cost and expense (but, in the case of Leased Properties, in the
name and stead of the Lessor): (a) the granting of easements, licenses,
rights-of-way and other rights and privileges in the nature of easements
reasonably necessary or desirable for the use, repair, or maintenance of any
Property or burdening any Property as herein provided; (b) the release of
existing easements or other rights in the nature of easements which are for the
benefit of any Property; (c) if required by applicable Governmental Authority in
connection with the making of any Modification permitted under this Master
Lease, the dedication or transfer of unimproved portions of any Property for
road, highway or other public purposes; (d) the execution of amendments to any
covenants and restrictions affecting any Property; and (e) the execution or
release of any similar agreement; provided, however, that in each case (i) the
Lessee provides no less than thirty (30) days prior written notice thereof to
the Lessor, (ii) such grant, release, dedication, transfer or amendment does not
materially impair the Fair Market Sales Value, utility, condition, residual
value or remaining useful life of any Property (iii) such grant, release,
dedication, transfer or amendment is, in the Lessee's judgment, reasonably
necessary in connection with the use, maintenance, alteration or improvement of
any Property, (iv) such grant, release, dedication, transfer or amendment will
not cause any Property or any portion thereof to fail to comply with the
provisions of this Master Lease or any other Operative Document to which the
Lessee is a party or fail to comply in any material respect with any Applicable
Law (including all applicable zoning, planning, building and subdivision
ordinances, all applicable restrictive covenants and all applicable
architectural approval requirements), (v) all governmental consents or approvals
required prior to such grant, release, dedication, transfer, annexation or
amendment have been obtained, and all filings required prior to such action have
been made, (vi) the Lessee shall remain obligated under this Master Lease and
each of the Lease Supplements in accordance with their respective terms, as
though such grant, release, dedication, transfer or amendment had not been
effected, (vii) the Lessee shall pay and perform any obligations of the Lessor
under such grant, release, dedication, transfer or amendment and (viii) such
grant, release, dedication,
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transfer or amendment would not result in the Lessor or the Lessee being
required to offer to sell the Xxxxxxx Property or any portion thereof to the
holder of the right of first offer relating to the Xxxxxxx Property. Without
limiting the effectiveness of the foregoing, provided that no Lease Event of
Default shall have occurred and be continuing, the Lessor shall, upon the
request of Lessee, and at the Lessee's sole cost and expense, execute and
deliver any instruments necessary or appropriate to confirm any such grant,
release, dedication, transfer, annexation or amendment to any Person permitted
under this Section 11.2, including landlord waivers with respect to any of the
foregoing.
ARTICLE XII
PERMITTED CONTESTS
Section 12.1. Permitted Contests. Except to the extent otherwise provided
in Section 13.4(b) of the Participation Agreement regarding Impositions and
other Taxes, if, to the extent and for so long as (a) a test, challenge, appeal
or proceeding for review of any Applicable Law or any Lien, encumbrance, levy,
attachment or encroachment relating to any Property shall be prosecuted
diligently and in good faith in appropriate proceedings by the Lessee, or (b)
compliance with such Applicable Law shall have been excused or exempted by a
valid nonconforming use, variance permit, waiver, extension or forbearance,
Lessee shall not be required to comply with such Applicable Law or remove or
discharge such Lien, encumbrance, levy, attachment or encroachment but only if
and so long as any such test, challenge, appeal, proceeding, waiver, extension,
forbearance or noncompliance shall not (in the reasonable opinion of the Lessor)
involve (A) any risk of criminal liability being imposed on the Lessor, any
Investor or the Arranger for failure to comply therewith or (B) any material
risk of (1) foreclosure, forfeiture or loss of any Property, or any material
part thereof, or (2) the nonpayment of Rent or (C) any substantial risk of (1)
the creation of any Lien (other than a Permitted Property Lien) on any part of
any Property, (2) civil liability being imposed on the Lessor, any Investor, the
Arranger or any Property unless, in the case of any risk of such civil liability
being imposed on a Property, the Lessee shall have otherwise bonded or secured
such amounts in a manner satisfactory to the Lessor, or (3) enjoinment of, or
interference with, the use, possession or disposition of any Property in any
material respect.
The Lessor shall not be required to join in any proceedings pursuant to
this Section 12.1 unless a provision of any Applicable Law requires or, in the
good faith opinion of the Lessee, it is advisable for the prosecution of such
contest, that such proceedings be brought by or in the name of such party; and
in that event the Lessor will join in the proceedings or permit them or any part
thereof to be brought in its name if and so long as (i) no Lease Default shall
have occurred and be continuing, and (ii) the Lessee pays all related expenses
and indemnifies the Lessor with respect to such proceedings.
ARTICLE XIII
INSURANCE
Section 13.1. General. During the Lease Term the Lessee shall, at its sole
cost and expense, maintain insurance as set forth in this Section 13.1.
(a) Public Liability Insurance. For so long as any Property is subject to
the provisions of this Master Lease, the Lessee shall procure and carry, at the
Lessee's sole cost and expense, commercial general liability/umbrella insurance
for claims for injuries or death sustained by third-party persons and
third-party property damage and such other public liability coverages as are
ordinarily procured by the Lessee and its Affiliates that own or operate similar
properties, but in any case shall provide liability coverage of at least
$5,000,000 per occurrence. Such insurance shall be on terms that are consistent
with prudent industry standards for a company the size of the Lessee.
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Master Lease
(b) Worker's Compensation. The Lessee shall comply with all applicable
workers' compensation laws.
(c) Hazard and Other Insurance. The Lessee shall keep, or cause to be
kept, each Property insured against loss or damage by fire, windstorm and other
risks on terms and in amounts that are consistent with prudent industry
standards for a company the size of the Lessee, but in any case shall provide
coverage for each Property in an amount not less than the lesser of the
Termination Base Amount or the replacement cost thereof; provided that the
Lessee shall also obtain (i) with respect to any Property located at a site that
shall have been assigned to a seismic zone of 3 or 4 under the Uniform Building
Code published from time to time by the International Conference of Building
Officials (or any successor code published by such entity or any successor
entity), coverage for earthquakes, and (ii) with respect to any Property located
within an area identified as a special flood hazardous area by the Federal
Emergency Management Agency, coverage for floods. The settlement of any loss or
occurrence shall be negotiated by the Lessee; provided the Lessor shall have the
right to approve (which approval shall not be unreasonably withheld) any
settlement involving proceeds greater than $2,000,000 that apply to a Property
and provided, further, that if any Lease Event of Default shall have occurred
and be continuing, any such settlement shall, unless the Lessor otherwise
agrees, be negotiated by the Lessor. All insurance proceeds that apply to a
Property payable with respect to any Casualty shall be paid to the Lessee or the
Lessor as provided in Section 14.2.
(d) Pollution Liability Coverage. For so long as any Property is subject
to the provisions of this Master Lease, the Lessee shall procure and carry, at
the Lessee's sole cost and expense, pollution liability coverage for the
Properties with a liability limit of no less than $5,000,000 per occurrence and
$10,000,000 in the aggregate for a term expiring no earlier than the Scheduled
Lease Termination Date and with no retroactive date, insuring third party bodily
injury, property damage and clean-up costs. The pollution liability coverage
shall include losses arising out of existing conditions at the Properties as
well as conditions that arise during the Lease Term. If coverage is on a "claims
made" rather than an "occurrence" basis, the insurance must be maintained for at
least five (5) years after the Lease Expiration Date.
(e) Deductibles. The insurance required to be obtained by the Lessee under
this Section 13.1 may be subject to such deductible amounts and self-insured
retentions as is consistent with prudent industry standards for a company the
size of the Lessee; provided that such deductible amounts and self-insured
retentions shall not exceed (i) $1,000,000 per occurrence with respect to the
insurance required by Sections 13.1(a) and 13.1(b), (ii) $500,000 per occurrence
with respect to the insurance required by Section 13.1(c) (provided, that higher
deductibles will be permitted with respect to earthquake and wind coverage under
Section 13.1(c) so long as such deductibles do not exceed 5% of the replacement
cost of the applicable Property) or (iii) $5,000,000 per occurrence with respect
to the insurance required by Section 13.1(d).
Section 13.2. Insurance Coverage. The Lessee shall cause the insurance
required to be maintained by the Lessee under this Article XIII to comply with
the provisions of this Section 13.2.
(a) Coverage and Endorsements. All insurance required to be maintained
pursuant to Section 13.1 shall provide in the policy or by special endorsement
as follows:
(i) in the case of insurance required to be maintained under
Sections 13.1(a) and 13.1(d), the Lessor, the Lessor Administrator and
each Investor are included as additional insureds as their interests may
appear;
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Master Lease
(ii) in the case of insurance required to be maintained under
Section 13.1(c), the Lessor is named as loss payee and each such insurance
policy shall include a standard mortgage loss payee endorsement in favor
of the Lessor;
(iii) such insurance shall not be cancelled nor shall the coverage
thereunder be materially reduced except upon no less than thirty (30)
days' advance written notice by the insurer to the Lessor thereof;
(iv) the insurer thereunder waives all rights of subrogation against
the Lessor, the Lessor Administrator and each Investor and waives any
right of set-off and counterclaim and any other right to deduction whether
by attachment or otherwise;
(v) the insurance in favor of the Lessor and the Investors and their
respective rights under and interests in such policies shall not be
invalidated or reduced by any act or omission (including breach of
warranty) or negligence of the Lessee or any other Person having any
interest in the Property; and
(vi) such insurance shall be primary and noncontributable and shall
apply to any loss or claim before any contribution of any other insurance
carried by or on behalf of the Lessor or any Investor.
(b) Insurance Providers. All such insurance shall be written by reputable
insurance companies that are financially sound and solvent and otherwise
reasonably appropriate considering the amount and type of insurance being
provided by such companies. Any insurance company selected by the Lessee to
provide property damage insurance shall have a rating from A.M. Best Company of
at least "A-" for financial strength and at least Class X for financial size (or
comparable ratings by a nationally or internationally recognized rating group of
comparable stature).
(c) Payment of Premiums. The Lessee shall pay as they become due all
premiums for the insurance required by Section 13.1 and Section 13.2, and shall
renew or replace each policy prior to the expiration date thereof.
(d) Initial Delivery of Insurance Certificates. With respect to each
Property, the Lessee shall furnish the Lessor with certificates showing the
insurance required under Section 13.1 to be in effect with respect to such
Property on or prior to the Acquisition Date or Replacement Date (as applicable)
for such Property. With respect to the insurance coverage described in Section
13.1(d), the Lessee shall furnish the Lessor with a copy of the insurance
provider's acknowledgment that the Properties are covered by such insurance.
(e) Annual Delivery of Insurance Certificates; Delivery of Insurance
Certificates upon Renewal of Policies. The Lessee shall, at the time each of the
Lessee's insurance policies is renewed (but in no event less frequently than
once each year) and upon reasonable request of the Investors, deliver to the
Lessor and the Investors certificates of insurance evidencing that all insurance
required by this Article XIII is being maintained by the Lessee and is in
effect.
ARTICLE XIV
CASUALTY AND CONDEMNATION; ENVIRONMENTAL MATTERS
Section 14.1. Risk of Loss, Damage or Destruction. (a) At all times that
any Property is subject to the provisions of this Master Lease, the Lessee bears
all risk of loss, damage, theft, taking,
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destruction, confiscation, requisition or commandeering, partial or complete, of
or to such Property or any part thereof, however caused or occasioned. The
Lessee agrees that no occurrence specified in the preceding sentence shall
affect, in whole or in part, any obligation of the Lessee under this Master
Lease, including the obligation to pay Rent. Without limiting the generality of
the foregoing, in the event that during the Lease Term the use of any Property
is requisitioned or taken by any Governmental Authority under the power of
eminent domain or otherwise for a period which does not constitute an Event of
Loss, all of Lessee's obligations under the Operative Documents, including the
Lessee's obligation to pay all installments of Basic Rent, shall continue for
the duration of such requisitioning or taking.
(b) If any Event of Loss occurs and such Event of Loss does not constitute
a Lease Event of Default under Section 16.1(p), then the Lessee shall exercise
its Replacement Option or its Termination Option, in each case with respect to
the affected Property, and shall consummate such replacement or termination no
later than sixty (60) days following the occurrence of such Event of Loss.
Section 14.2. Casualty and Condemnation. (a) Insurance Proceeds and
Condemnation Awards. Subject to the provisions of this Article XIV, (x) if all
or a portion of any Property is damaged or destroyed in whole or in part by a
Casualty while such Property is subject to the provisions of this Master Lease,
any insurance proceeds payable with respect to such Casualty shall be paid
directly to the Lessee, or if received by the Lessor, shall be paid over to the
Lessee for the reconstruction, refurbishment and repair of the affected
Property, and (y) if the use, access, occupancy, easement rights or title to any
Property or any part thereof is the subject of a Condemnation while such
Property is subject to the provisions of this Master Lease, then any award or
compensation relating thereto shall be paid to the Lessee; provided, however,
that, in each case, if (A) any Lease Default or Lease Event of Default shall
have occurred and be continuing or (B) the Lessee shall not have Ratings of
"BBB-" or better by S&P and "Baa3" or better by Xxxxx'x, then such award,
compensation or insurance proceeds shall be paid directly to the Lessor or, if
received by the Lessee, shall be held in trust for the Lessor and shall be paid
over by the Lessee to the Lessor, and the Lessor shall hold such amounts in a
segregated account and, upon presentation by the Lessee of paid invoices or
other evidence reasonably satisfactory to the Lessor as to the Lessee's prior
payment of reasonable costs required for repair of the applicable Property, the
Lessor shall pay such amounts over to the Lessee to reimburse the Lessee for the
reasonable cost of repair and restoration of the applicable Property (provided
that, so long as no Lease Default or Lease Event of Default shall have occurred
and be continuing, any such insurance proceeds, awards or compensation shall be
paid to the Lessee in an amount, in the aggregate with all such proceeds, awards
and compensation relating to the applicable Property, not to exceed the lesser
of $5,000,000 and 25% of the Termination Base Amount of the affected Property
(with any excess over such lesser amount to be paid over to the Lessor in
accordance with the foregoing proviso); provided, further, however, that in the
case of (x) a Lease Default or Lease Event of Default, (y) the delivery by the
Lessor of a Partial Termination Notice with respect to such Property or (z) the
Lessee's election (if applicable) of its Termination Option with respect to such
Property, then such amounts shall, in the Lessor's discretion, be applied toward
the payment of the Termination Price or Termination Base Amount (as applicable)
of the affected Property and related amounts in accordance with Section 16.2,
15.1 or 19.1 (as applicable).
(b) Participation in Proceedings. The Lessee may appear in any proceeding
or action to negotiate, prosecute, adjust or appeal any claim for any award,
compensation or insurance payment on account of any Casualty or Condemnation
with respect to any Property and shall pay all expenses thereof. At the Lessee's
reasonable request, and at the Lessee's sole cost and expense, the Lessor shall
participate in any such proceeding, action, negotiation, prosecution or
adjustment. The Lessor and the Lessee agree that this Master Lease shall control
the rights of the Lessor and the Lessee in and to any such award, compensation
or insurance payment.
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Master Lease
(c) Notices of Casualty or Condemnation. The Lessee shall, within fifteen
(15) Business Days after obtaining knowledge of the occurrence of (x) any
Casualty with respect to any Property for which the reasonable anticipated cost
of restoration equals or exceeds $2,000,000, (y) an actual, pending or
threatened Condemnation of any Property or any material interest therein or (z)
any Casualty or Condemnation affecting a Property that could reasonably be
expected to result in a Termination Event, notify the Lessor in writing of such
occurrence. If the Lessor receives any notice of a Condemnation affecting any
Property directly from any Governmental Authority, the Lessor will promptly (and
in no event later than fifteen (15) Business Days) forward such notice to the
Lessee.
(d) Repair. If this Master Lease shall continue in full force and effect
with respect to any Property following a Casualty or Condemnation affecting such
Property, then the Lessee shall, at its sole cost and expense, promptly and
diligently repair any damage to such Property caused by such Casualty or
Condemnation in conformity with the requirements of Sections 8.2, 8.3, 9.1, 10.1
and 11.1 so as to restore such Property to at least the same or substantially
similar (assuming no Lease Default or Lease Event of Default was then
continuing) condition, operation, function and value as existed immediately
prior to such Casualty or Condemnation with such Modifications as the Lessee may
elect in accordance with Section 10.1. In such event, title to any such Property
that is a Leased Property shall remain with the Lessor subject to the terms of
this Master Lease. Upon completion of such restoration, the Lessee shall furnish
to the Lessor a Responsible Officer's Certificate of the Lessee confirming that
such restoration has been completed pursuant to this Master Lease.
(e) Obligations Continue. In no event shall a Casualty or Condemnation
affect the Lessee's obligations to pay Rent pursuant to Section 3.1 hereof or to
perform its obligations and pay any amounts due on the Expiration Date or
pursuant to Articles XVIII and XX hereof.
(f) Excess Casualty/Condemnation Proceeds. Upon the earliest of (x) the
date on which all damage to a Property caused by a Casualty or Condemnation
shall have been repaired in accordance with Section 14.2(d), (y) the date on
which the Termination Base Amount or Termination Price (as applicable) of the
affected Property and all other amounts due and payable under Section 15.1 or
19.1, as applicable, shall have been paid to the Lessor, and (z) the date on
which the affected Property shall have been replaced with a Replacement Property
under Section 19.2, any Net Proceeds received by the Lessor or any Investor in
respect of such Casualty or Condemnation, to the extent remaining after any
application of such Net Proceeds to the repair or restoration of the applicable
Property or to the payment of the Termination Base Amount or Termination Price
(as applicable) for such Property and such other amounts, as the case may be
(any such Net Proceeds remaining after such application, "Excess
Casualty/Condemnation Proceeds"), shall be promptly paid to the Lessee.
Section 14.3. Remediation of Environmental Violations. If any
Environmental Violation exists or occurs with respect to any Property and either
(x) such Environmental Violation shall not constitute a Termination Event or (y)
such Environmental Violation shall constitute a Termination Event but the Lessee
shall not have exercised its Termination Option or Replacement Option within the
thirty (30)-day period following the date on which the Lessee shall have
knowledge of the occurrence of such Environmental Violation (or, if the Lessee
shall have so exercised its Termination Option or Replacement Option but shall
not have consummated such Termination Option or Replacement Option in accordance
with the terms of this Master Lease), then the Lessee shall, at the Lessee's
sole cost and expense, diligently commence and prosecute to completion with all
deliberate speed any response, clean up, Remedial Action or other action
necessary to remove, clean up or remediate any such Environmental Violation in
accordance with the terms of Section 8.3. The Lessee shall, upon completion of
Remedial Action by the Lessee, cause to be prepared by a reputable environmental
consultant of the sort typically hired by sophisticated parties, a report
describing the Environmental Violation and the actions taken by the Lessee (or
its agents) in response to such Environmental Violation, and a statement by the
consultant
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Master Lease
that the Environmental Violation has been remedied in compliance in all material
respects with applicable Environmental Laws. Nothing in this Article XIV shall
reduce or limit the Lessee's obligations under Article XIII of the Participation
Agreement.
Section 14.4. Notice of Environmental Violations. (a) The Lessee shall,
within twenty (20) Business Days after obtaining knowledge of the existence of
an Environmental Violation with respect to any Property, notify the Lessor in
writing of such Environmental Violation.
(a) Promptly, but in any event within twenty (20) Business Days from the
date the Lessee has actual knowledge thereof, the Lessee shall provide to the
Lessor written notice of any notice of any pending or threatened claim, action
or proceeding involving any Environmental Laws, any Release or Remedial Action
on or in connection with any Property. All such notices shall describe in
reasonable detail the nature of the claim, action or proceeding and the Lessee's
proposed response thereto. In addition, the Lessee shall provide to the Lessor,
within twenty (20) Business Days of receipt, copies of all written
communications with the Governmental Authority relating to any Environmental
Violation in connection with any Property. The Lessee shall also promptly
provide such detailed reports of any such material environmental claims as may
reasonably be requested by the Lessor or any Investor. In the event that the
Lessor receives written notice of any pending or threatened claim, action or
proceeding involving any Environmental Laws, any Release or Remedial Action on
or in connection with any Property, the Lessor shall promptly give notice
thereof to the Lessee.
ARTICLE XV
PARTIAL TERMINATION OF LEASE AT LESSOR'S OPTION
Section 15.1. Partial Termination Upon Certain Events. If, with respect to
any Property: (a) an Event of Loss occurs or (b) an Environmental Violation
occurs or is discovered and the cost of remediation of which the Lessee
determines in its reasonable good faith judgment could reasonably be expected to
exceed the lesser of $5,000,000 and twenty percent (20%) of the Termination Base
Amount of such Property; and the Lessor shall have given prior written notice (a
"Partial Termination Notice") to the Lessee that, as a consequence of such
event, this Master Lease is to be terminated with respect to such Property, then
the Lessee shall be obligated, on the date specified by the Lessor (which date
shall be a Business Day no earlier than sixty (60) days after delivery of the
applicable Partial Termination Notice but in any event not later than the
Expiration Date), to (1) in the case of an affected Leased Property, purchase
the affected Property and pay to the Lessor, as the purchase price thereof, or
(2) in the case of an affected Mortgaged Property, cause the release of such
Property from the Lien of the Lessor Mortgage applicable thereto and pay to the
Lessor, in exchange for such release, an amount equal to the sum of (x) the
Termination Base Amount of the affected Property on such date plus (y) all
accrued and unpaid Accrual Rent allocable to an amount of Property Cost equal to
such Termination Base Amount, plus (z) without duplication all Basic Rent and
Supplemental Rent, including Break Costs, due and owing on such date (after
giving effect to such purchase), and the Lessor shall, as set forth in Section
15.2, on such date of payment transfer to the Lessee all of the interest of the
Lessor in the affected Property (in the case of a Leased Property) and release
any Lessor Mortgage encumbering Property; provided, however, that the Lessee
shall not be obligated to purchase the affected Property if the Lessee delivers
a Replacement Notice within ten (10) days after receiving the Partial
Termination Notice and completes the replacement in accordance with Section 19.2
within sixty (60) days after receiving the Partial Termination Notice.
Section 15.2. Partial Termination Procedures. On the date of the payment
by the Lessee of all amounts required to be paid under Section 15.1 in
accordance with the procedures set forth in Section 15.1 (such date, the
"Partial Termination Date"), the Lease Supplement relating to the affected
Property shall terminate (or if the relevant Property is a Mortgaged Property,
the Lessor Mortgage relating
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to such Mortgage shall be released) and this Master Lease shall terminate with
respect to such affected Property, and the Lessor shall, at the Lessee's sole
cost and expense, take the following actions in respect of the applicable
affected Property upon the Lessor's receipt of all amounts due with respect to
such affected Property and all other amounts then due in accordance with Section
15.1:
(a) if the relevant Property is a Leased Property, the Lessor shall
execute and deliver to the Lessee (or to the Lessee's designee) at the
Lessee's sole cost and expense: (x) a quitclaim deed with respect to the
affected Property, containing representations and warranties of grantor
regarding the absence of Lessor Liens (but no other representations or
warranties), and (y) an assignment of the entire interest of the Lessor in
such affected Property (which shall include an assignment of all of the
right, title and interest of the Lessor in and to any Excess
Casualty/Condemnation Proceeds), in each case in recordable form and
otherwise in conformity with local custom to the extent consistent with
the foregoing scope of the Lessor's representations and warranties and
free and clear of the Lien of the Lessor Mortgage and any Lessor Liens;
(b) if the relevant Property is a Leased Property, such affected
Property shall be conveyed to the Lessee (or to the Lessee's designee) "AS
IS" and in its then present physical condition;
(c) the Lessor shall convey to the Lessee any Excess
Casualty/Condemnation Proceeds with respect to the affected Property;
(d) if the relevant Property is a Leased Property, the Lessor shall
execute and deliver to the Lessee (or its designee) and, if requested by
the Lessee, the Lessee's title insurance company, an affidavit as to the
absence of Lessor Liens; and
(e) (i) the Lessee and the Lessor shall execute and deliver to each
other a statement of termination of this Master Lease with respect to such
affected Property and, if the relevant Property is a Leased Property, a
termination of the Lease Supplement covering such affected Property, and
(ii) the Lessor shall execute such terminations, releases or other
instruments as the Lessee may reasonable request to evidence the release
of any Lessor Mortgage encumbering such Property.
ARTICLE XVI
LEASE EVENTS OF DEFAULT
Section 16.1. Lease Events of Default. The occurrence of any one or more
of the following events (whether such event shall be voluntary or involuntary or
come about or be effected by operation of law or pursuant to or in compliance
with any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body) shall constitute a "Lease Event of
Default":
(a) any representation or warranty made or deemed made by the Lessee
in or in connection with the execution and delivery of this Master Lease
or the other Operative Documents or the transactions contemplated hereby
or thereby (including any representation or warranty contained in any
certificate, document or financial or other statement furnished at any
time under or in connection with any Operative Document) shall prove to
have been false or misleading in any material respect when so made, deemed
made or furnished;
(b) any default shall be made in the payment of any Basic Rent,
Property Cost, Aggregate Property Cost, Termination Price, Termination
Base Amount or Lease Balance when
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and as the same shall become due and payable, whether at the due date
thereof or at a date fixed for prepayment thereof or by acceleration
thereof or otherwise;
(c) the Lessee shall fail to pay any Fee or Supplemental Rent (other
than an amount referred to in paragraph (b) above) when due under the
Operative Documents and such failure shall be continuing on the tenth
(10th) Business Day following the date on which the Lessee receives
written notice that such amount is due and payable;
(d) any default shall be made in the due observance or performance
of any covenant, condition or agreement contained in Section 10.1(a),
10.1(e), 10.2(a), 10.2(b), 10.2(c) or 10.2(d) of the Participation
Agreement and, in the case of any default under Section 10.2(b) of the
Participation Agreement, such default shall continue for thirty (30) days;
(e) any default shall be made in the due observance or performance
of any covenant, condition or agreement contained herein or in any other
Operative Document (other than those specified in paragraph (b), (c) or
(d) above or paragraph (l) below) and (i) in the case of any such
covenant, condition or agreement contained in clauses (a) through (i) of
Section 10.1 of the Participation Agreement or contained in Section 10.2
of the Participation Agreement, such default shall continue unremedied for
a period of thirty (30) days after notice thereof from the Lessor or any
Investor to the Lessee and (ii) in the case of any other such covenant,
condition or agreement, such default shall continue unremedied for a
period of thirty (30) days after notice thereof from the Lessor or any
Investor to the Lessee or, if such default cannot reasonably be remedied
within such thirty (30) day period, the Lessee shall have failed to remedy
such default prior to the period ending on the 120th day following such
notice to the Lessee or shall have failed to diligently pursue such remedy
during such period;
(f) the Lessee or any Lessee Subsidiary shall (i) fail to pay any
principal or interest, regardless of amount, due in respect of any
Indebtedness in a principal amount in excess of $20,000,000, beyond the
period of grace, if any, provided in the agreement or instrument under
which such Indebtedness was created, or (ii) fail to observe or perform
any other term, covenant, condition or agreement contained in any
agreement or instrument evidencing or governing any such Indebtedness, or
any other event shall occur or condition shall exist, beyond the period of
grace, if any, provided in such agreement or instrument, if the effect of
any failure referred to in this clause (ii) is to cause, or to permit the
holder or holders of such Indebtedness or a trustee on its or their behalf
(with or without the giving of notice) to cause, such Indebtedness to
become due prior to its stated maturity;
(g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i)
relief in respect of the Lessee, or of a substantial part of the property
or assets of the Lessee or any Lessee Subsidiary with assets having gross
book value in excess of $25,000,000, under Title 11 of the United States
Code, as now constituted or hereafter amended, or any other Federal or
state bankruptcy, insolvency, receivership or similar law, (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator
or similar official for the Lessee or for a substantial part of the
property or assets of the Lessee or any Lessee Subsidiary with assets
having gross book value in excess of $25,000,000 or (iii) the winding up
or liquidation of the Lessee; and such proceeding or petition shall
continue undismissed for sixty (60) days or an order or decree approving
or ordering any of the foregoing shall be entered;
(h) the Lessee or any Lessee Subsidiary with assets having a gross
book value in excess of $25,000,000 shall (i) voluntarily commence any
proceeding or file any petition seeking
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relief under Title 11 of the United States Code, as now constituted or
hereafter amended, or any other Federal or state bankruptcy, insolvency,
receivership or similar law, (ii) consent to the institution of, or fail
to contest in a timely and appropriate manner, any proceeding or the
filing of any petition described in paragraph (g) above, (iii) apply for
or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Lessee or for a
substantial part of the property or assets of the Lessee, (iv) file an
answer admitting the material allegations of a petition filed against it
in any such proceeding, (v) make a general assignment for the benefit of
creditors, (vi) become unable, admit in writing its inability or fail
generally to pay its debts as they become due or (vii) take any action for
the purpose of effecting any of the foregoing;
(i) one or more final judgments shall be entered by any court
against the Lessee or any of the Lessee Subsidiaries for the payment of
money in an aggregate amount in excess of $100,000,000 and such judgment
or judgments shall not have been paid, covered by insurance, discharged or
stayed for a period of sixty (60) days, or a warrant of attachment or
execution or similar process shall have been issued or levied against
property of the Lessee or any of the Subsidiaries to enforce any such
judgment or judgments;
(j) an ERISA Event shall have occurred that, in the opinion of the
Lessor, when taken together with all other such ERISA Events, could
reasonably be expected to result in a Material Adverse Effect;
(k) a Change in Control shall occur;
(l) any insurance required to be maintained by the Lessee pursuant
to Article XIII of this Master Lease shall fail to be in effect or any
default shall be made in the due observance or performance of any
covenant, condition or agreement contained in Article VI or Section
11.1(a);
(m) any Operative Document to which the Lessee is a party or any
Lien granted by the Lessee under any Operative Document shall, in whole or
in material part, terminate, cease to be effective against, or (other than
as expressly provided therein) cease to be the legal, valid, binding and
enforceable obligation of the Lessee other than as permitted under, or
pursuant to the terms of, or in connection with a transaction permitted
by, any Operative Document;
(n) the Lessee shall directly or indirectly contest the
effectiveness, validity, binding nature or enforceability of any Operative
Document or any Lien granted under any Operative Document;
(o) any contract, permit or license in connection with any Property
(including any in connection with the use, occupancy, zoning or operation
of any Property) shall cease to be in full force and effect and such
cessation, in the aggregate with any such cessation affecting any other
Property, shall have had, or could reasonably be expected to have, a
Material Adverse Effect or a material adverse effect on the Fair Market
Sales Value, condition, utility, remaining useful life or residual value
of any Property; or
(p) any Casualty or Condemnation affecting any Property shall have
occurred and the aggregate Termination Base Amounts of all Properties then
unaffected by any Casualty or Condemnation shall be less than 30% of the
Aggregate Original Property Cost.
Section 16.2. Remedies. Upon the occurrence of any Lease Event of Default
and at any time thereafter, the Lessor may, so long as such Lease Event of
Default is continuing, do one or more of the
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following (and in such order) as the Lessor in its sole discretion shall
determine, without limiting any other right or remedy the Lessor may have on
account of such Lease Event of Default (including the obligation of the Lessee
to purchase all of the Properties as set forth in Section 18.2):
(a) The Lessor may declare the entire outstanding Lease Balance to
be immediately due and payable, whereupon the Lease Balance shall become
forthwith due and payable, without presentment, demand, protest or any
notice of any kind, all of which are hereby expressly waived by the
Lessee; provided, however, that upon the occurrence of an Event of Default
described in clause (g) or (h) of Section 16.1, (A) the obligation of the
Lessor to acquire any Leased Property on the Acquisition Date shall
automatically terminate and (B) the Lease Balance shall automatically
become and be due and payable, without presentment, demand, protest or any
notice of any kind, all of which are hereby expressly waived by the
Lessee;
(b) The Lessor may make demand upon the Lessee for the amounts due
under the Operative Documents;
(c) The Lessor may, by notice to the Lessee, rescind or terminate
this Master Lease as of the date specified in such notice; however, (i) no
reletting, reentry or taking of possession of any Leased Property (or any
portion thereof) by the Lessor (or its agents) will be construed as an
election on the Lessor's part to terminate this Master Lease unless a
written notice of such intention is given to the Lessee, (ii)
notwithstanding any reletting, reentry or taking of possession, the Lessor
may at any time thereafter elect to terminate this Master Lease for a
continuing Lease Event of Default, and (iii) no act or thing done by the
Lessor or any of its agents, representatives or employees and no agreement
accepting a surrender of any Leased Property shall be valid unless the
same be made in writing and executed by the Lessor;
(d) The Lessor may (i) demand that the Lessee, and the Lessee shall
upon the written demand of the Lessor, return all of the Leased Properties
promptly to the Lessor in the manner and condition required by, and
otherwise in accordance with all of the provisions of this Lease
(including Sections 8.2, 8.3, 9.1, 10.1 and 11.1 hereof) as if the
Properties were being returned on the Scheduled Lease Termination Date,
and the Lessor shall not be liable for the reimbursement of the Lessee for
any costs and expenses incurred by the Lessee in connection therewith, and
(ii) without prejudice to any other remedy that the Lessor may have for
possession of the Properties, and to the extent and in the manner
permitted by Applicable Law and any applicable DOD Restrictions, enter
upon any Leased Property and take immediate possession of (to the
exclusion of the Lessee) the Leased Properties or any part thereof and
expel or remove the Lessee and any other Person who may be occupying any
Leased Property, by summary proceedings or otherwise, all without
liability to the Lessor for or by reason of such entry or taking of
possession, whether for the restoration of damage to any property caused
by such taking or otherwise and, in addition to the other damages of the
Lessor, the Lessee shall be responsible for all costs and expenses
incurred by the Lessor, the Investors and/or the Arranger in connection
with any reletting, including reasonable brokers' fees and all costs of
any alterations or repairs required to be made by the Lessor so that the
Properties achieve the standard of condition required by this Master
Lease;
(e) As more fully set forth in Section 16.4 hereof, in each Lease
Supplement (and consistent with the intent of the parties as detailed in
Article XXV hereof) and in each Lessor Mortgage, the Lessor may exercise
all remedies available to a mortgagee, secured party, beneficiary or
trustee under law or equity, including, to the extent permitted by law,
the right to sell all or any part of the Properties at public or private
sale, as the Lessor may determine;
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(f) The Lessor may, at its option, elect not to terminate this
Master Lease and continue to collect all Basic Rent, Supplemental Rent,
and all other amounts due to the Lessor (together with all costs of
collection) and enforce the Lessee's obligations under this Master Lease
as and when the same become due, or are to be performed, and at the option
of the Lessor, upon any abandonment of any Leased Property by the Lessee
or re-entry of same by the Lessor, the Lessor may, in its sole and
absolute discretion, elect not to terminate this Master Lease and may make
the necessary repairs in order to relet any Leased Property, and relet
such Leased Property or any part thereof for such term or terms (which may
be for a long term extending beyond the Lease Term of this Master Lease)
and at such rental or rentals and upon such other terms and conditions as
the Lessor in its reasonable discretion may deem advisable; and upon each
such reletting, all rentals actually received by the Lessor from such
reletting shall be applied to the Lessee's Obligations in the manner
provided in Section 7.4 of the Participation Agreement. If such rentals
received from such reletting during any period are less than the Rent to
be paid during that period by the Lessee hereunder, the Lessee shall pay
any deficiency, as calculated by the Lessor, to the Lessor on the next
Scheduled Payment Date;
(g) Unless all of the Leased Properties have been sold in their
entirety, the Lessor may, whether or not the Lessor shall have exercised
or shall thereafter at any time exercise any of its rights under clause
(d), (e) or (f) of this Section 16.2 with respect to any or all of the
Properties or any portions thereof, demand, by written notice to the
Lessee specifying a date not earlier than twenty (20) days after the date
of such notice, that the Lessee purchase, on the date specified in such
notice, all of the unsold Properties in accordance with the provisions of
Article XXI and Section 18.2 for an amount equal to the then outstanding
Lease Balance;
(h) The Lessor may exercise any other right or remedy that may be
available to it under Applicable Law, or proceed by appropriate court
action (legal or equitable) to enforce the terms hereof or to recover
damages for the breach hereof. Separate suits may be brought to collect
any such damages for any period(s), and such suits shall not in any manner
prejudice the Lessor's rights to collect any such damages for any
subsequent period(s), or the Lessor may defer any such suit until after
the Expiration Date, in which event such suit shall be deemed not to have
accrued until the Expiration Date;
(i) The Lessor may retain and apply against the Lease Balance all
sums which the Lessor would, absent such Lease Event of Default, be
required to pay to, or turn over to, the Lessee pursuant to the terms of
this Master Lease (including any amounts held by the Lessor pursuant to
Section 14.2); or
(j) The Lessor, to the extent permitted by Applicable Law, as a
matter of right and with notice to the Lessee, shall have the right to
apply to any court having jurisdiction to appoint a receiver or receivers
of any part of each Property, and the Lessee hereby irrevocably consents
to any such appointment. Any such receivers shall have all of the usual
powers and duties of receivers in like or similar cases and all of the
powers and duties of the Lessor in case of entry, and shall continue as
such and exercise such powers until the date of confirmation of the sale
of the applicable Property unless such receivership is sooner terminated.
The Lessor shall be entitled to enforce payment of the indebtedness and
performance of the Obligations secured hereby and to exercise all rights and
powers under this instrument or under any of the other Operative Documents or
other agreement or any laws now or hereafter in force, notwithstanding some or
all of the Obligations secured hereby may now or hereafter be otherwise secured,
whether by mortgage, security agreement, pledge, lien, assignment or otherwise.
Neither the acceptance of this instrument nor its enforcement shall prejudice or
in any manner affect the Lessor's right to realize upon or
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enforce any other security now or hereafter held by the Lessor, it being agreed
that the Lessor shall be entitled to enforce this instrument and any other
security now or hereafter held by the Lessor in such order and manner as the
Lessor may determine in its absolute discretion. No remedy herein conferred upon
or reserved to the Lessor is intended to be exclusive of any other remedy herein
or by law provided or permitted, but each shall be cumulative and shall be in
addition to every other remedy given hereunder or now or hereafter existing at
law or in equity or by statute. Every power or remedy given by any of the
Operative Documents to the Lessor or to which the Lessor may otherwise be
entitled, may be exercised, concurrently or independently, from time to time and
as often as may be deemed expedient by the Lessor. In no event shall the Lessor,
in the exercise of the remedies provided in this instrument (including in
connection with the assignment of rents to the Lessor, or the appointment of a
receiver and the entry of such receiver onto all or any part of the Properties),
be deemed a "mortgagee in possession," and the Lessor shall not in any way be
made liable for any act, either of commission or omission, in connection with
the exercise of such remedies.
If, pursuant to the exercise by the Lessor of its remedies pursuant to
this Section 16.2, the Lease Balance and all other amounts due and owing from
the Lessee under this Master Lease and the other Operative Documents have been
paid in full, then the Lessor shall remit to the Lessee any excess amounts
received by the Lessor.
If requested by the Lessor in connection with the exercise of its remedies
pursuant to this Section 16.2, subject to the good faith mutual agreement of the
Lessor and the Lessee, the Lessee hereby agrees to enter into an operating
agreement with respect to the Properties having a term no longer than one year
and in connection therewith to serve as the operator of the Properties; provided
that such agreement shall be on market terms established in good faith and
reasonably acceptable to the Lessor and the Lessee.
Section 16.3. Waiver of Certain Rights. (a) To the maximum extent
permitted by law, the Lessee hereby waives the benefit of any appraisement,
valuation, stay, extension, reinstatement and redemption laws now or hereafter
in force and all rights of marshalling in the event of any sale of any Property
or any interest therein, (b) if this Master Lease shall be terminated pursuant
to Section 16.2, the Lessee waives, to the fullest extent permitted by law, (i)
any notice of re-entry or the institution of legal proceedings to obtain
re-entry or possession; (ii) any right of redemption, re-entry or repossession;
(iii) the benefit of any laws now or hereafter in force exempting property from
liability for rent or for debt or limiting the Lessor with respect to the
election of remedies; and (iv) any other rights that might otherwise limit or
modify any of the Lessor's rights or remedies under this Article XVI.
Section 16.4. Mortgage/Deed of Trust Remedies. Without limiting any other
remedies set forth in this Master Lease, and also, without limiting the
generality of Article XXV hereof, the Lessor may proceed by a suit or suits in
equity or at law, whether for a foreclosure hereunder or under the Lease
Supplements, or (to the extent permitted by law) for the sale of each Property,
pursuant to a power of sale, or against the Lessee on a recourse basis for the
Lease Balance, or for the specific performance of any covenant or agreement
contained herein or in aid of the execution of any power granted herein, or for
the appointment of a receiver pending any foreclosure hereunder (or under the
Lease Supplements) or the sale of any Property, or for the enforcement of any
other appropriate legal or equitable remedy. The Lessor shall have all rights
available to a mortgagee (or of a beneficiary under a deed of trust) or a
secured party under the laws of the state where the relevant Property is
located, including all rights granted under the specific statutes referenced in
each Lease Supplement, if any (each such statute, as amended, is hereinafter
referred to as a "Mortgage Foreclosure Act"). In the event that any provisions
of this Master Lease shall be inconsistent with any Mortgage Foreclosure Act,
the provisions of such Mortgage Foreclosure Act shall take precedence over such
provision of this Master Lease, but shall not invalidate or render unenforceable
any other provision of this Master Lease that can be construed in a manner
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consistent with such Mortgage Foreclosure Act. If any provision of this Master
Lease shall grant the Lessor any rights or remedies upon default of the Lessee
that are more limited than the rights that would otherwise be vested in the
Lessor under such Mortgage Foreclosure Act in the absence of such provision, the
Lessor shall be vested with the broader rights granted in such Mortgage
Foreclosure Act to the full extent permitted by law. The Lessee agrees that the
agreements of Lessee herein contained shall be specifically enforceable by
injunction or any other appropriate equitable remedy and that for the purpose of
any suit brought pursuant hereto, the Lessee hereby waives, to the fullest
extent permitted by law, the defense of laches and any applicable statute of
limitations. In the event of foreclosure, the Lessee authorizes and empowers the
Lessor to effect insurance upon the Properties in amounts aforesaid for a period
covering the time of redemption from foreclosure sale provided by law, and if
necessary therefor, to cancel any or all existing insurance policies required to
be maintained under this Master Lease.
ARTICLE XVII
LESSOR'S RIGHT TO CURE; LESSOR'S OBLIGATION TO FORWARD NOTICES
Section 17.1. The Lessor's Right to Cure the Lessee's Lease Defaults. The
Lessor, without waiving or releasing any obligation or Lease Event of Default,
may (but shall be under no obligation to) remedy any Lease Event of Default for
the account and at the sole cost and expense of the Lessee, including the
failure by the Lessee to maintain the insurance required by Article XIII, and
may, to the fullest extent permitted by law, and notwithstanding any right of
quiet enjoyment in favor of the Lessee (but subject to any applicable DOD
Restrictions), enter upon any Property for such purpose and take all such action
thereon as may be necessary or appropriate therefor. No such entry shall be
deemed an eviction of the Lessee. All reasonable out-of-pocket costs and
expenses so incurred (including fees and expenses of counsel), together with
interest thereon at the Overdue Rate from the date on which such sums or
expenses are paid by the Lessor, shall be paid by the Lessee to the Lessor as
Supplemental Rent.
Section 17.2. Lessor's Obligation to Forward Notices. The Lessor shall
deliver to the Lessee copies of all notices received by the Lessor from any
Governmental Authority (including all notices of any tax assessment, levy, duty
or other xxxx from any Governmental Authority) with respect to the Lessee or any
Property promptly but in any event within ten (10) Business Days after the
Lessor's receipt thereof.
ARTICLE XVIII
PURCHASE BY LESSEE
Section 18.1. Purchase Option on Expiration Date. The Lessee shall have
the right at its option to purchase the Lessor's interest in all (but not less
than all) of the Leased Properties on the Scheduled Lease Termination Date in
accordance with this Section 18.1 (the "Purchase Option") by delivering prior
written notice thereof not later than one hundred eighty (180) days prior to the
Scheduled Lease Termination Date to the Lessor and, unless the Lessee shall have
properly exercised the Return Option and shall have fulfilled all of the
requirements of Article XX, the Lessee shall be deemed to have elected to
purchase the Lessor's interest in all of the Leased Properties pursuant to this
Section 18.1. Any such notice or deemed election shall be irrevocable. If the
Lessee shall have elected (or shall have been deemed to have elected) to
purchase all of the Leased Properties under this Section, then, subject to the
terms, conditions and provisions set forth in this Section, and in accordance
with the procedures set forth in Section 21.1, the Lessee (or its designee)
shall purchase from the Lessor, and the Lessor shall convey to the Lessee (or
its designee), on the Scheduled Lease Termination Date all of the interest of
the Lessor in all of the Leased Properties for an amount equal to one dollar
($1); provided that the Lessee shall have paid all accrued and unpaid Basic Rent
and all Supplemental Rent owing on the Scheduled Lease
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Termination Date (including the final payment of Fixed Rent) after giving effect
to such purchase. The Lessee may designate, in a notice given to the Lessor not
less than ten (10) Business Days prior to the closing of such purchase, the
transferee or transferees to whom the conveyance shall be made (if other than to
the Lessee), in which case such conveyance shall (subject to the terms and
conditions set forth herein) be made to such designee; provided, however, that
such designation of a transferee or transferees shall not cause the Lessee to be
released, fully or partially, from any of its obligations under this Master
Lease, including the obligation to pay the Lessor the final Basic Rent payment
on the Scheduled Lease Termination Date.
Section 18.2. Acceleration of Purchase Obligation. The Lessee shall be
obligated to purchase for an amount equal to the Lease Balance all of the
interest of the Lessor in all of the Leased Properties automatically and without
notice upon the occurrence of any Lease Event of Default described in clause (g)
or (h) of Section 16.1. Any purchase under this Section 18.2 shall be in
accordance with the procedures set forth in Section 21.1.
ARTICLE XIX
TERMINATION OR REPLACEMENT FOR OBSOLESCENCE, EVENT OF LOSS, ETC.
Section 19.1. Right of Termination.
(a) Termination Option. The Lessee shall have the right at its option (the
"Termination Option") to terminate the Lease with respect to one or more
Properties (including any Mortgaged Property) if: (i) such Property or
Properties are no longer being used by the Lessee or any of its Affiliates in
its business as a result of such Property or Properties (x) becoming obsolete or
surplus to the Lessee's or such Affiliate's requirements, (y) suffering a
Casualty or Condemnation or (z) suffering a title defect or Environmental
Violation or (ii) the Indemnitees shall have demanded payment from the Lessee of
amounts owing under Article XIII of the Participation Agreement as a result of
events outside of the control of the Lessee, the payment of which, in the
aggregate, cause the implicit rate of return on the Aggregate Property Cost to
increase by more than 0.20% above the implicit rate of return anticipated on the
Acquisition Date or (iii) such Property or Properties are intended to be held
for sale (any event described in clause (iii), a "Sale Termination Event" and
any event described in clause (i), (ii) or (iii), a "Termination Event," and the
applicable Property to which the Termination Event relates, the "Terminated
Property"). To exercise this option the Lessee shall deliver a written notice (a
"Termination Notice") to the Lessor and each Investor specifying a proposed date
of termination for such Property that is no earlier than thirty (30) days after
the date such Termination Notice is delivered (the "Termination Date"). Any such
termination shall be effective on the Termination Date upon the Lessee's
compliance with this Section 19.1; provided that:
(A) in the case of a Termination Event described in clause (i), (1)
the Lessee shall not have the right to exercise its Termination Option at
any time prior to the third (3rd) anniversary of the Acquisition Date
(except in the case of a Termination Option exercised pursuant to clause
(y) of such clause (i), which may be exercised at any time), (2) the
determination that the applicable Property qualifies for termination
pursuant to clause (i) shall be made by the Lessee in good faith, and (3)
the Termination Notice shall contain a certificate executed by the Chief
Financial Officer of the Lessee certifying that the applicable Property
qualifies for termination pursuant to clause (i) of this Section 19.1(a);
(B) in the case of a Termination Event described in clause (ii), (1)
the Lessee shall exercise its Termination Option with respect to all and
not less than all of the Properties
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Master Lease
and (2) the determination that the Properties qualify for termination
pursuant to clause (ii) shall be made jointly by the Lessor and Lessee in
good faith; and
(C) in the case of a Termination Event described in clause (iii),
(1) the Lessee shall not have the right to exercise its Termination Option
prior to the third (3rd) anniversary of the Acquisition Date and (2) the
Termination Notice shall contain a certificate executed by the Chief
Financial Officer of the Lessee certifying that such Property is intended
to be held for sale.
The Lessee will reimburse the Lessor and each Investor for all Break Costs and
all reasonable out-of-pocket costs and expenses (including reasonable legal fees
and expenses) incurred by any thereof in connection with such termination or
proposed termination. On the Termination Date, the Lessee shall pay or cause to
be paid to the Lessor (or in the case of Supplemental Rent, to the Persons
entitled thereto) in funds of the type specified in Section 3.4, an amount equal
to the sum of (x) the Termination Price of the Terminated Property (or, if the
applicable Termination Event is a Sale Termination Event, an amount equal to the
unamortized Termination Base Amount of the Terminated Property plus the
Termination Indemnity Amount for such Property on the applicable Termination
Date) plus (y) all accrued and unpaid Accrual Rent allocable to an amount of
Property Cost equal to the Termination Base Amount to be paid on such
Termination Date plus (z) without duplication, all Basic Rent and Supplemental
Rent (including Break Costs) then due and owing after giving effect to such
termination (including all Supplemental Rent that shall have been demanded
pursuant to Article XIII of the Participation Agreement), in each case
calculated as of the Termination Date, it being understood that until such sums
are paid, there shall be no abatement or reduction of Basic Rent on account of
the applicable Termination Event or otherwise. All payments received by the
Lessor from the Lessee pursuant to this Section 19.1 will be distributed and
applied by the Lessor in accordance with Article VII of the Participation
Agreement.
(b) Transfer of Property. Upon the payment of all sums required to be paid
pursuant to Section 19.1(a) in respect of any Terminated Property or Terminated
Properties, the Lessor shall (x) in the case of Terminated Properties that are
Leased Properties, transfer the applicable Terminated Property or Terminated
Properties to the Lessee or its designee in accordance with the procedures set
forth in Section 21.1 or (y) in the case of any Terminated Property that is a
Mortgaged Property, comply with the procedures set forth in clause s(c) and (e)
of Section 21.1.
(c) Termination of Lease. In the event of any such sale and receipt by the
Lessor of all of the amounts provided in Section 19.1(a) in respect of a
Terminated Property that is a Leased Property and upon compliance by the Lessee
with the other provisions of this Section 19.1, the obligation of Lessee to pay
Basic Rent hereunder for such Terminated Property shall cease and the Lease Term
for the Terminated Property shall end.
Section 19.2. Replacement. Following the occurrence of any Termination
Event described in clause (i) or (iii) of Section 19.1(a), the Lessee shall have
the right at its option (the "Replacement Option") to replace the applicable
Terminated Property in accordance with this Section 19.2.
(a) Requirements. To exercise the Replacement Option the Lessee shall
deliver a written notice (a "Replacement Notice") to the Lessor and each
Investor specifying a proposed date of replacement for such Property that is no
earlier than thirty (30) days after the date such Termination Notice is
delivered (the date of such replacement in accordance with Section 19.2(b)
below, the "Replacement Date"). The Lessee shall comply with the provisions of
clause (b) below applicable to such replacement and shall either (x) if the
applicable Terminated Property is a Leased Property, convey or cause to be
conveyed to the Lessor on the Replacement Date one or more replacement
Properties (each such Property, a "Replacement Property") for the applicable
Terminated Property or Terminated
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Master Lease
Properties, with such Replacement Properties to be leased to the Lessee
hereunder from and after the Replacement Date or (y) if the applicable
Terminated Property is a Mortgaged Property, grant to the Lessor a Lien on a
Replacement Property pursuant to a Lessor Mortgage in form and substance
reasonably satisfactory to the Lessor; provided that, in each case, (1) the
determination that the applicable Property qualifies for replacement as a result
of satisfying the requirements of clause (i) or (iii) of Section 19.1(a) shall
be made by the Lessee in good faith and (2) the Replacement Notice shall contain
a certificate executed by the Chief Financial Officer of the Lessee certifying
that the applicable Property qualifies for replacement as a result of satisfying
the requirements of clause (i) or (iii) of Section 19.1(a); and provided,
further, that the following conditions are satisfied:
(i) each Replacement Property shall be located in the continental
United States,
(ii) each Replacement Property shall be free and clear of all Liens
(other than Permitted Property Liens);
(iii) such Replacement Property or Replacement Properties shall have
a Fair Market Sales Value, in the aggregate, at least equal to unamortized
Termination Base Amount of the applicable Terminated Property;
(iv) in no event shall such Replacement Property or Replacement
Properties have a remaining economic useful life of less than fifteen (15)
years;
(v) there shall be no fewer than three (3) Properties subject to
this Master Lease after giving effect to such replacement;
(vi) each of the conditions set forth in Section 6.1 of the
Participation Agreement shall have been satisfied (except that each
reference to a Subject Property shall be deemed to refer to the
Replacement Property and each reference to the Acquisition Date shall be
deemed to refer to the applicable Replacement Date); and
(vii) the representations and warranties of the Lessee set forth in
Section 8.2 of the Participation Agreement shall be true and correct with
respect to the Lessee and such Replacement Property on and as of the
applicable Replacement Date.
(b) Items to be delivered. Prior to any replacement of any Property and as
a condition to such replacement, the Lessee, at its own expense, will:
(i) furnish to the Lessor each of the items set forth in Section 6.1
of the Participation Agreement in each case with respect to the proposed
Replacement Property and on and as of the Replacement Date (instead of the
Acquisition Date),
(ii) cause a Lease Supplement substantially in the form of Exhibit A
hereto and dated as of the Replacement Date, subjecting such Replacement
Property to this Lease and duly executed by the Lessee, to be delivered to
the Lessor (or, if the applicable Terminated Property is a Mortgaged
Property, cause a Lessor Mortgage covering such Replacement Property and
dated as of the Replacement Date and duly executed by the Lessee to be
delivered to the Lessor),
(iii) upon execution of the Lease Supplement described in clause
(ii) by the Lessee and the Lessor (or, if the applicable Terminated
Property is a Mortgaged Property, upon execution of the Lessor Mortgage
described in clause (ii) by the Lessee), cause such Lease Supplement (or
Lessor Mortgage) to be filed for recordation in the same manner as
provided for
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Master Lease
the original Lease Supplement (or original Lessor Mortgage, as the case
may be) in the Participation Agreement,
(iv) furnish to the Lessor a Responsible Officer's Certificate of
the Lessee certifying that the Replacement Property is free and clear of
all Liens (other than Permitted Property Liens), and
(v) furnish such other documents and evidence as the Lessor, any
Investor or their respective counsel may reasonably request in order to
establish the consummation of the transactions contemplated by this
Section 19.2.
For all purposes hereof, (i) the Replacement Date shall be deemed to occur on
the earliest date on which the Lessee shall have complied with all of the
requirements of this clause (b) with respect to a replacement made in accordance
with clause (a) above, (ii) title to each Replacement Property conveyed in
connection with a Terminated Property that is a Leased Property shall be deemed
to have been transferred to the Lessor as of the Replacement Date and (iii) (x)
in the case of a Terminated Property that is a Leased Property, upon such
passage of title thereto to the Lessor, and (y) in the case of a Terminated
Property that is a Mortgaged Property, upon the recordation of the applicable
Lessor Mortgage as required under Section 6.1(n) of the Participation Agreement,
the Replacement Property shall be deemed a "Property" for all purposes of the
Operative Documents and the original Property shall no longer be deemed to be a
"Property" for purposes of the Operative Documents and, in the case of a
Replacement Property for a Leased Property, the Replacement Property shall be
deemed part of the Properties leased hereunder.
(c) Transfer or Release of Replaced Property. Upon (i) the passage of
title with respect to a Leased Property described in clause (b) above, the
Lessor will transfer to the Lessee all Lessor's right, title and interest in and
to the replaced Property or (ii) the recordation of a Lessor Mortgage with
respect to a Mortgaged Property described in clause (b) above, the Lessor will
release the Lessor Mortgage encumbering the replaced Property, in each case in
accordance with the procedures set forth in Section 21.1. The Lessee shall
promptly pay all reasonable out-of-pocket costs and expenses (including
reasonable legal fees and expenses) incurred by the Lessor, the Lessor
Administrator or any Investor in connection with any replacement pursuant to
this Section 19.2, provided that the Lessee shall be responsible for the legal
fees and expenses of only one set of lawyers for the Investors (in addition to
any local counsel reasonably required by the Lessor or any Investor) unless the
Investors and/or such counsel reasonably determines that such representation
could create a conflict of interest. The Lessee further agrees that, upon
receipt of fully signed counterparts of the Lease Supplement referred to in
clause (ii) of Section 19.2(b), it will, at its sole cost and expense, cause
such documents to be filed or recorded in the manner contemplated by Section
6.1(n) of the Participation Agreement.
ARTICLE XX
RETURN OPTION; RETURN PROVISIONs
Section 20.1. Option to Return. Subject to the fulfillment of each of the
conditions set forth in this Section 20.1 and Section 20.2 (collectively, the
"Return Conditions"), the Lessee shall have the option (the "Return Option") to
return all (but not less than all) of the Leased Properties to the Lessor on the
Expiration Date.
The Lessee's effective exercise and consummation of the Return Option
shall be subject to the due and timely fulfillment of each of the following
provisions and the provisions of Section 20.2 as to each of the Leased
Properties as of the dates set forth below:
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Master Lease
(a) Unless a longer period is called for pursuant to any Applicable
Law, on the date not later than one hundred eighty (180) days prior to the
Scheduled Lease Termination Date, the Lessee shall give to the Lessor
written notice of the Lessee's exercise of the Return Option.
(b) Not later than one hundred and twenty (120) days prior to the
Expiration Date, the Lessee shall deliver to the Lessor an Environmental
Audit for each Property. Such Environmental Audit shall be prepared by an
environmental consultant selected by the Lessor in the Lessor's discretion
and shall contain conclusions satisfactory to the Lessor as to the
environmental status of each Property as to which the Lessor shall be
entitled to rely in accordance with the terms of the scope of services as
set forth in the Environmental Audit prepared by the environmental
consultant. If any such Environmental Audit indicates any exceptions
calling for a Phase Two environmental assessment, the Lessee shall have
also delivered prior to the Expiration Date a Phase Two environmental
assessment by such environmental consultant and a written statement by
such environmental consultant indicating that all such exceptions have
been remedied in compliance with Applicable Law.
(c) The Lessee shall have substantially completed all Modifications,
restoration and rebuilding of the relevant Properties pursuant to Sections
10.1 and 14.1 (as the case may be) and shall have fulfilled all of the
conditions and requirements in connection therewith pursuant to such
Sections. The Lessee shall have also paid the cost of all Modifications
commenced prior to the Expiration Date. The Lessee shall not have been
excused pursuant to Section 12.1 from complying with any Applicable Law
that involved the extension of the ultimate imposition of such Applicable
Law beyond the Expiration Date. Any Permitted Property Liens (other than
Lessor Liens) on any Property that were contested by the Lessee shall have
been removed and the Lessor shall have received evidence satisfactory to
it that all Liens (other than Lessor Liens and uncontested Permitted
Property Liens of the type described in clauses (i), (ii), (vii), (viii)
and (ix) of the definition thereof) shall have been removed.
(d) Not later than sixty (60) days prior to the Expiration Date, the
Lessee shall have cured or caused to be cured all Environmental Violations
affecting any Property and if ISRA is applicable, provide proof that it is
in Compliance with ISRA.
(e) The Lessee shall pay to the Lessor (or in the case of
Supplemental Rent, to the Person entitled thereto) on or prior to the
Expiration Date an amount equal to the outstanding Lease Balance in the
type of funds specified in Section 3.4 hereof.
(f) The Lessee shall return all of the Leased Properties in
accordance with Section 20.2.
Section 20.2. Return. If the Lessee elects its Return Option, the Lessee
shall do each of the following with respect to each Leased Property at its own
cost and expense, on or prior to the Expiration Date:
(a) execute and deliver to the Lessor (or to the Lessor's designee)
(A) a deed (warranting against acts and Liens of the Lessee and its
Affiliates) with respect to its interest in the applicable Property, (B) a
xxxx of sale with respect to its interest in all personalty and Equipment
(if any) included in the applicable Property and (C) an assignment of the
Lessee's entire interest in the applicable Property (which shall include
an assignment of all of the Lessee's right, title and interest in and to
all awards, compensation and insurance proceeds payable with respect to
the applicable Property in connection with any Casualty or Condemnation
affecting the applicable Property and an assignment of leases of the
applicable Property), in each case in
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Master Lease
recordable form and otherwise in conformity with local custom and free and
clear of any Liens attributable to the Lessee or its Affiliates other than
Permitted Property Liens referenced in clauses (i), (ii), (vii), (viii),
and (ix) of the definition thereof;
(b) execute and deliver to the Lessor and the Lessor's title
insurance company an affidavit as to the absence of any Liens (other than
Permitted Property Liens of the type described in clause (i), (ii), (vii),
(viii) and (ix) of the definition thereof);
(c) execute and deliver to the Lessor a statement of termination of
this Master Lease and each Lease Supplement;
(d) vacate each Leased Property and transfer possession of each
Leased Property to the Lessor or any Person designated by the Lessor by
surrendering the same into the possession of the Lessor or such Person, as
the case may be, in the condition required by this Master Lease and in
compliance with Applicable Law; and
(e) cooperate fully with the Lessor and/or any Person designated by
the Lessor to receive such Leased Property, which cooperation shall
include: (i) if requested by the Lessor, subject to the good faith mutual
agreement of the Lessor and the Lessee, the entering into of an operating
agreement with respect to such Property having a term no longer than one
year and in connection therewith serving as the operator of the such
Property; (provided that such agreement shall be on market terms
established in good faith and reasonably acceptable to the Lessor and the
Lessee), (ii) providing copies of all records regarding the maintenance of
such Property and all non-proprietary data and technical information
relating thereto, (iii) providing a current copy of the applicable Plans
and Specifications for each Property (if any), (iv) granting or assigning
all assignable licenses necessary for the operation and maintenance of
each Property and (v) cooperating reasonably in the seeking and obtaining
of all necessary Governmental Action.
ARTICLE XXI
PROCEDURES RELATING TO CONVEYANCE TO LESSEE
Section 21.1. Provisions Relating to the Conveyance of Properties to the
Lessee upon Certain Events. In connection with (x) the Lessee's exercise of its
Termination Option with respect to any Property pursuant to Section 19.1, (y)
the Lessee's exercise of its Replacement Option with respect to any Terminated
Property to be replaced or (z) the Lessee's purchase of all of the Properties
pursuant to Section 18.1, or in connection with the Lessee's obligations under
Section 16.2(g) or 18.2, then, upon the date on which this Master Lease is to
terminate with respect to the relevant Property and upon tender by the Lessee of
the amounts set forth in Section 19.1, 19.2, 16.2(g), 18.1 or 18.2, as
applicable:
(a) if the relevant Property is a Leased Property, the Lessor shall
execute and deliver to the Lessee (or to the Lessee's designee) at the
Lessee's cost and expense: (x) a quitclaim deed with respect to the
relevant Property, containing representations and warranties of grantor
regarding the absence of Lessor Liens (but no other representations or
warranties), and (y) an assignment of the entire interest of the Lessor in
such Property (which shall include an assignment of all of the right,
title and interest of the Lessor in and to any Excess
Casualty/Condemnation Proceeds), in each case in recordable form and
otherwise in conformity with local custom to the extent consistent with
the foregoing scope of the Lessor's representations and warranties and
free and clear of the Lien of the Lessor Mortgage and any Lessor Liens;
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Master Lease
(b) if the relevant Property is a Leased Property, such Property
shall be conveyed to the Lessee (or to the Lessee's designee) "AS IS" and
in its then present physical condition;
(c) the Lessor shall convey to the Lessee any Excess
Casualty/Condemnation Proceeds with respect to the Property;
(d) if the relevant Property is a Leased Property, the Lessor shall
execute and deliver to the Lessee (or its designee) and, if requested by
the Lessee, the Lessee's title insurance company, an affidavit as to the
absence of Lessor Liens; and
(e) (i) the Lessee and the Lessor shall execute and deliver to each
other a statement of termination of this Master Lease with respect to such
Property and, if such Property is a Leased Property, a statement of
termination of the Lease Supplement covering such Property, and (ii) the
Lessor shall execute such terminations, releases or other instruments as
the Lessee may reasonably request to evidence the release of any Lessor
Mortgage encumbering such Property.
ARTICLE XXII
ESTOPPEL CERTIFICATES
Section 22.1. Estoppel Certificates. At any time and from time to time
upon not less than twenty (20) Business Days' prior request by the Lessor or the
Lessee (the "Requesting Party"), the other party (whichever party shall have
received such request, the "Certifying Party") shall furnish to the Requesting
Party a certificate signed by (i) in the case of the Lessee, a Responsible
Officer of the Lessee and (ii) in the case of the Lessor, the Lessor
Administrator, certifying that this Master Lease is in full force and effect (or
that this Master Lease is in full force and effect as modified and setting forth
the modifications); the dates to which the Basic Rent and Supplemental Rent have
been paid; to the best knowledge of the signer of such certificate, whether or
not the Requesting Party is in default under any of its obligations hereunder
and, if so, the nature of such alleged default; and such other matters under
this Master Lease as the Requesting Party may reasonably request.
Any such certificate furnished pursuant to this Article XXII may be relied
upon by, and any existing or prospective mortgagee, purchaser or lender.
ARTICLE XXIII
ACCEPTANCE OF SURRENDER
Section 23.1. Acceptance of Surrender. No surrender to the Lessor of this
Master Lease or of all or any of the Leased Properties or of any part of any
thereof or of any interest therein shall be valid or effective unless agreed to
and accepted in writing by the Lessor, and no act by the Lessor or any
representative or agent of Lessor, other than a written acceptance, shall
constitute an acceptance of any such surrender.
ARTICLE XXIV
NO MERGER OF TITLE
Section 24.1. No Merger of Title. There shall be no merger of this Master
Lease or of the leasehold estate created hereby by reason of the fact that the
same Person may acquire, own or hold, directly or indirectly, in whole or in
part, (a) this Master Lease or the leasehold estate created hereby or
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Master Lease
any interest in this Master Lease or such leasehold estate, (b) the fee estate
in any Property, except as may expressly be stated in a written instrument duly
executed and delivered by the Lessor, or (c) a beneficial interest in the
Lessor.
ARTICLE XXV
INTENT OF THE PARTIES
Section 25.1. Ownership of the Property. (a) The parties hereto intend
that for (i) financial accounting purposes with respect to the Lessee, (ii)
United States federal and all United States state and local income tax purposes
and (iii) United States state real estate and commercial law and bankruptcy
purposes,
(A) the Lease will be treated as a financing arrangement,
(B) the Lessor will be deemed a lender making a loan to the Lessee
in an aggregate amount equal to the Aggregate Original Property Cost which
loan is secured by the Properties, and
(C) the Lessee will be treated as the owner of the Leased Properties
described in the Lease Supplements and will be entitled to all tax
benefits ordinarily available to an owner of properties similar to the
Properties for such tax purposes.
Specifically, without limiting the generality of the foregoing, the parties
hereto intend and agree that in the event of any insolvency or receivership
proceedings or a petition under the United States bankruptcy laws or any other
applicable insolvency laws or statute of the United States of America or any
state or commonwealth thereof affecting the Lessee, the Lessor or the Investors
or any collection actions, the transactions evidenced by the Operative Documents
shall be regarded as loans made to the Lessee by the Lessor and the Investors as
unrelated third party lenders of the Lessee. Nevertheless, the Lessee
acknowledges and agrees that none of the Lessor, the Arranger or any Investor
has made any representations or warranties to the Lessee concerning the tax,
accounting or legal characteristics of the Operative Documents and that the
Lessee has obtained and relied upon such tax, accounting and legal advice
concerning the Operative Documents as it deems appropriate. The parties hereto
will not take any position inconsistent with the intentions expressed herein.
(b) It is the intent of the parties hereto that this Lease grants a
security interest and mortgage or deed to secure debt or deed of trust, as the
case may be, in and on each Property to the Lessor for the benefit of the Lessor
to secure the performance of the Lessee under and payment of all amounts under
this Master Lease and the other Operative Documents all as more specifically set
forth in each Lease Supplement.
(c) Tax Ownership. The Lessor represents and warrants to the Lessee that
it will not, prior to the termination of the Lease with respect to a Property,
claim ownership of (or any tax benefits, including depreciation, with respect
to) such Property for any United States income tax purposes (unless required to
do so by a Governmental Authority), it being understood that the Lessee is and
will remain the owner of such Property for such United States income tax
purposes until the termination of the Lease with respect thereto.
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Master Lease
ARTICLE XXVI
MISCELLANEOUS
Section 26.1. Severability. If any term or provision of this Master Lease
or any application thereof shall be declared invalid or unenforceable, the
remainder of this Master Lease and any other application of such term or
provision shall not be affected thereby.
Section 26.2. Amendments and Modifications. Subject to the requirements,
restrictions and conditions set forth in the Participation Agreement, neither
this Master Lease nor any provision hereof may be amended, waived, discharged or
terminated except by an instrument in writing signed by the Lessee and the
Lessor.
Section 26.3. No Waiver. No failure by the Lessor, any Investor or the
Lessee to insist upon the strict performance of any term hereof or to exercise
any right, power or remedy upon a default hereunder, and no acceptance of full
or partial payment of Rent during the continuance of any such default, shall
constitute a waiver of any such default or of any such term. To the fullest
extent permitted by law, no waiver of any default shall affect or alter this
Master Lease, and this Master Lease shall continue in full force and effect with
respect to any other then existing or subsequent default.
Section 26.4. Notices. All notices, demands, requests, consents, approvals
and other communications hereunder shall be in writing and directed to the
address described in, and deemed received in accordance with the provisions of,
Section 14.3 of the Participation Agreement.
Section 26.5. Successors and Assigns. All the terms and provisions of this
Master Lease shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns; provided, that the Lessee may not
assign or otherwise transfer any of its rights or obligations hereunder without
the prior written consent of the Lessor (and any attempted assignment or
transfer by the Lessee without such consent shall be null and void).
Section 26.6. Headings and Table of Contents. The headings and table of
contents in this Master Lease are for convenience of reference only and shall
not limit or otherwise affect the meaning hereof.
Section 26.7. Counterparts. This Master Lease may be executed in any
number of counterparts, each of which shall be an original, but all of which
shall together constitute one and the same instrument.
Section 26.8. GOVERNING LAW. THIS MASTER LEASE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS, EXCEPT TITLE 14 OF
ARTICLE 5 OF THE NEW YORK GENERAL OBLIGATIONS LAW (EXCEPT AS OTHERWISE SET FORTH
IN THE LEASE SUPPLEMENT WITH RESPECT TO THE CREATION AND PERFECTION OF THE LIENS
AND SECURITY INTERESTS IN EACH PROPERTY AND THE RIGHTS AND REMEDIES OF THE
LESSOR WITH RESPECT TO EACH PROPERTY).
Section 26.9. Original Lease. The single executed original of this Master
Lease marked "THIS COUNTERPART IS THE ORIGINAL EXECUTED COUNTERPART" on the
signature page thereof and containing the receipt thereof of the Lessor therefor
on or following the signature page thereof shall be the Original Executed
Counterpart of this Master Lease (the "Original Executed Counterpart"). To the
extent that this Master Lease constitutes chattel paper, as such term is defined
in the Uniform Commercial
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Master Lease
Code as in effect in any applicable jurisdiction, no security interest in this
Master Lease may be created through the transfer or possession of any
counterpart other than the Original Executed Counterpart.
Section 26.10. Time of Essence. With respect to each of the Lessee's
obligations under this Master Lease, time is of the essence, and the Lessee
hereby acknowledges and confirms the foregoing.
Section 26.11. Liability Limited. The obligations of the Lessor hereunder
are subject to the limitations set forth in Section 14.10 of the Participation
Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have caused this Master Lease to be duly
executed and delivered as of the date first above written.
ITT INDUSTRIES, INC., as Lessee
By /s/ Xxxxxx Xxxxx
---------------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President, Treasurer and
Director of Tax
MASTER LEASE
REXUS L.L.C., as Lessor
By /s/ Xxxxx Xxxxxx
----------------------------------
Name: Xxxxx Xxxxxx
Title: President
MASTER LEASE
THIS COUNTERPART IS THE ORIGINAL EXECUTED COUNTERPART, Receipt of this
original counterpart of the foregoing Master Lease is hereby acknowledged as of
the date hereof.
REXUS L.L.C., as Lessor
By /s/ Xxxxx Xxxxxx
----------------------------------
Name: Xxxxx Xxxxxx
Title: President
MASTER LEASE
SCHEDULE I
TO MASTER LEASE
FIXED RENT
FIXED RENT ACCRUAL RENT BASIC RENT
DATE (*) (1) (2) = (1) + (2)
-------- --- --- -----------
December 31, 2004 0.231213% 0.182810% 0.414023%
December 30, 2005 6.052098% 4.742075% 10.794173%
December 29, 2006 6.339758% 4.454415% 10.794173%
December 31, 2007 6.606862% 4.187311% 10.794173%
December 31, 2008 6.934026% 3.860147% 10.794173%
December 31, 2009 7.275057% 3.519116% 10.794173%
December 31, 2010 7.621795% 3.172378% 10.794173%
December 30, 2011 7.992755% 2.801418% 10.794173%
December 31, 2012 8.352699% 2.441475% 10.794173%
December 31, 2013 8.764104% 2.030070% 10.794173%
December 17, 2014 33.829632% 1.550518% 35.380150%
---------- --------- ----------
Total 100.000000% 32.941733% 132.941733%
---------- --------- ----------
(*) Basic Rent is payable on the exact scheduled date before 10:00 a.m., New
York City time
MASTER LEASE
APPENDIX A
TO MASTER LEASE
A. Interpretation. In each Operative Document, unless a clear contrary
intention appears:
(i) the singular number includes the plural number and vice versa;
(ii) reference to any Person includes such Person's successors and assigns
but, if applicable, only if such successors and assigns are permitted by the
Operative Documents, and reference to a Person in a particular capacity excludes
such Person in any other capacity or individually;
(iii) reference to any gender includes each other gender;
(iv) reference to any agreement, document or instrument (including any
Operative Document) means such agreement, document or instrument as amended or
modified and in effect from time to time in accordance with the terms thereof
and, if applicable, the terms of the other Operative Documents, and reference to
any promissory note includes any promissory note which is an extension or
renewal thereof or a substitute or replacement therefor;
(v) reference to any Applicable Law means such Applicable Law as amended,
modified, codified, replaced or reenacted, in whole or in part, and in effect
from time to time, including rules and regulations promulgated thereunder, and
reference to any section or other provision of any Applicable Law means that
provision of such Applicable Law from time to time in effect and constituting
the substantive amendment, modification, codification, replacement or
reenactment of such section or other provision;
(vi) reference in any Operative Document to any Article, Section,
Appendix, Schedule or Exhibit means such Article or Section thereof or Appendix,
Schedule or Exhibit thereto, and reference in any Section of any Operative
Document to any clause means such clause of such Section;
(vii) "hereunder," "hereof, "hereto" and words of similar import shall be
deemed references to an Operative Document as a whole and not to any particular
Article, Section or other provision thereof;
(viii) "including" (and with correlative meaning "include") means
including without limiting the generality of any description preceding such
term; and
(ix) with respect to any rights and obligations of the parties under the
Operative Documents, all such rights and obligations shall be construed to the
extent permitted by Applicable Law.
B. Computation of Time Periods. Unless otherwise specified in any
Operative Document, for purposes of computation of periods of time under the
Operative Documents, the word "from" means "from and including" and the words
"to" and "until" each mean "to but excluding."
C. Accounting Terms and Determinations. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided,
however, that for purposes of determining compliance with any covenant set forth
in Section 10.1 or 10.2 of the Participation Agreement, such terms shall be
construed in accordance with GAAP as in effect on the Acquisition Date applied
on a basis consistent with the application used in preparing the Lessee's
audited financial statements referred to in Section 8.1(e)(i) of the
Participation Agreement; provided that, if the Lessee notifies the Lessor that
the Lessee requests an amendment to any
Appendix A
provision hereof to eliminate the effect of any change occurring after the
Acquisition Date in GAAP or in the application thereof on the operation of such
provision (or if the Lessor notifies the Lessee that the Investors request an
amendment to any provision hereof for such purpose), regardless of whether any
such notice is given before or after such change in GAAP or in the application
thereof, then such provision shall be interpreted on the basis of GAAP as in
effect and applied immediately before such change shall have become effective
until such notice shall have been withdrawn or such provision amended in
accordance herewith; provided further that GAAP as used in the Operative
Documents shall be applied without application of FAS 133.
D. Conflict in Operative Documents. If there is any conflict between any
Operative Documents, such Operative Documents shall be interpreted and
construed, if possible, so as to avoid or minimize such conflict but, to the
extent (and only to the extent) of such conflict, the Participation Agreement
shall prevail and control.
E. Legal Representation of the Parties. The Operative Documents were
negotiated by the parties with the benefit of legal representation and any rule
of construction or interpretation otherwise requiring the Operative Documents to
be construed or interpreted against any party shall not apply to any
construction or interpretation hereof or thereof.
F. Defined Terms. Unless a clear contrary intention appears, terms defined
herein have the respective indicated meanings when used in each Operative
Document.
"1940 Act" is defined in Section 8.1 of the Participation Agreement.
"Account" means the account identified by the Lessor in a writing
delivered to Lessee into which all payments by the Lessee under the Operative
Documents shall be made. The initial Account shall be specified on Schedule II
to the Participation Agreement.
"Accrual Rent" means the portion of Basic Rent that is described in
Section 3.5 of the Master Lease.
"Acquisition Date" is defined in Section 6.1 of the Participation
Agreement.
"Acquisition Date Notice" is defined in Section 3.4 of the Participation
Agreement.
"Affected Party" means the Lessor or any Investor.
"Affiliate" means, when used with respect to a specified person, another
person that directly or indirectly controls or is controlled by or is under
common control with the person specified.
"After Tax Basis" means, with respect to any payment to be received, the
amount of such payment increased so that, after deduction of the amount of all
taxes required to be paid by the recipient (less any tax savings realized and
the present value of any tax savings projected to be realized by the recipient
as a result of the payment of the indemnified amount) with respect to the
receipt by the recipient of such amounts, such increased payment (as so reduced)
is equal to the payment otherwise required to be made.
"Aggregate Original Property Cost" means the sum of the Original Property
Costs for all Leased Properties.
-2-
Appendix A
"Aggregate Property Cost" means, as of any date, the sum of the Property
Costs for all Leased Properties then subject to the Master Lease.
"Allocated Payments" means, with respect to any Leased Property, any
payment (or portion of any payment) applied to the Property Cost of such
Property pursuant to clause fifth of Section 7.2 of the Participation Agreement.
"Applicable Law" means all Federal, state, county, municipal and other
governmental statutes, laws, rules, orders, regulations, ordinances, judgments,
decrees and injunctions affecting any applicable Person, any Property, the
Improvements thereon or the demolition, construction, use or alteration thereof,
whether now or hereafter enacted and in force, including any that require
repairs, modifications or alterations in or to any Property or in any way
limited the use and enjoyment thereof (including all building, zoning and fire
codes and the Americans with Disabilities Act of 1990, 42 U.S.C. Section 1201 et
seq. and any other similar federal, state or local laws or ordinances and the
regulations promulgated thereunder) and any that may relate to environmental
requirements (including all Environmental Laws), and all permits, certificates
of occupancy, licenses, authorizations and regulations relating thereto, and all
covenants, agreements, restrictions and encumbrances contained in any
instruments that are of record affecting any Property, the Appurtenant Rights
and any easements, licenses or other agreements.
"Applicable Rate" means 4.700834% per annum.
"Appraisal" means, with respect to any Replacement Property, an appraisal
of the Fair Market Sales Value of such Replacement Property, which Appraisal
complies in all material respects with all of the provisions of the Financial
Institutions Reform, Recovery and Enforcement Act of 1989, as amended, the rules
and regulations adopted pursuant thereto, and all other Applicable Law, and is
addressed to the Lessor. Each Appraisal shall be prepared by a qualified real
estate appraiser selected by the Lessor and reasonably acceptable to the Lessee.
"Appurtenant Rights" means, with respect to any Land or Property, (i) all
agreements, easements, rights of way or use, rights of ingress or egress,
privileges, appurtenances, tenements, and other rights and benefits at any time
belonging or pertaining to such Land or the Improvements thereon, including the
use of any streets, ways, alleys, vaults or strips of land adjoining, abutting,
adjacent or contiguous to such Land and (ii) all permits, licenses and rights,
whether or not of record, appurtenant to such Land and (iii) all of the Lessee's
right, title and interest in all general intangibles relating to the design,
development, operation, management and use of the applicable Property, all
certificates of occupancy, zoning variances, building, use or other permits,
approvals, authorizations and consents obtained from and all materials prepared
for filing or filed with any Governmental Authority in connection with the
development, use, operation or management of the applicable Property, all
construction, service, engineering, consulting, leasing, architectural and other
similar contracts concerning the design, construction, management, operation,
occupancy and/or use of the applicable Property, all architectural drawings,
plans, specifications, soil tests, feasibility studies, appraisals,
environmental studies, engineering reports and similar materials relating to any
portion of or all of the applicable Property, and all payment and performance
bonds or warranties or guarantees relating to the applicable Property, all to
the extent assignable.
"Arrangement Letter" means the letter agreement dated November 26, 2003
between Air Bail and the Lessee with respect to the engagement of Air Bail as
the arranger in connection with the transactions described therein.
"Arranger" means Air Bail S.A.S., in its capacity as arranger.
-3-
Appendix A
"Bankruptcy Code" means Title 11 of the United States Code entitled
"Bankruptcy" as now or hereafter in effect or any successor thereto.
"Basic Rent" means, as determined on any date, the sum of (a) the amount
of accrued and unpaid Accrual Rent then due and (b) the amount of Fixed Rent due
and unpaid on such date.
"Board" means the Board of Governors of the Federal Reserve System of the
United States.
"Break Costs" means an amount equal to the amount, if any, required to
compensate an Affected Party for all losses, costs and expenses (including any
loss, cost or expense incurred by reason of any funding, hedging or other
contracts entered into by the Affected Party to fund its capital contribution to
the Lessor (in the case of an Investor) or its payment of the Property Costs (in
the case of the Lessor) or by reason of the liquidation or reemployment of
deposits or funds acquired by the Affected Party to fund its obligations under
the Operative Documents, but excluding loss of anticipated profit) it may incur
as a result of (x) the Lessee's payment of Rent other than on a Scheduled
Payment Date (except for Rent not due on a Scheduled Payment Date), (y) any
Property Cost not being paid by the Lessor on the date specified therefor in the
Acquisition Date Notice (other than as a result of a breach by an Investor of
its obligation under Section 4.02(a)(i) of the Lessor LLC Agreement to make
certain capital contributions to the Lessor) or (z) the Lessee's payment of the
Aggregate Property Cost, any Property Cost, any Termination Price or any
Termination Base Amount. A statement as to the amount of such loss, cost or
expense, prepared in good faith and in reasonable detail and submitted by an
Affected Party to the Lessee shall be correct and binding on the Lessee absent
manifest error.
"Business Day" means any day (other than a day which is a Saturday, Sunday
or legal holiday in the State of New York) on which banks are open for business
in New York City.
"Capitalized Lease-Back Obligation" means with respect to a Principal
Property, at any date as of which the same is to be determined, the total net
rental obligations of the Lessee or a Restricted Subsidiary under a lease of
such Principal Property, entered into as part of an arrangement to which the
provisions of Section 5.11 of the Existing Credit Agreement are applicable (or
would have been applicable had such Restricted Subsidiary been a Restricted
Subsidiary at the time it entered into such lease), discounted to the date of
computation at the rate of interest per annum implicit in the lease (determined
in accordance with GAAP). The amount of the net rental obligation for any
calendar year under any lease shall be the sum of the rental and other payments
required to be paid in such calendar year by the lessee thereunder, not
including, however, any amounts required to be paid by such lessee (whether or
not herein designated as rental or additional rental) on account of maintenance
and repairs, insurance, taxes, assessments, water rates and similar charges.
"Casualty" means any damage or destruction of all or any portion of any
Property as a result of a fire, flood, earthquake or other casualty.
"CERCLA" means the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, 42 U.S.C. Sections 9601 et seq., as amended by the
Superfund Amendments and Reauthorization Act of 1986.
"Certifying Party" is defined in Section 22.1 of the Master Lease.
"Change in Control" shall be deemed to have occurred if (a) any person or
group of persons shall have acquired beneficial ownership of more than 30% of
the outstanding Voting Shares of the Lessee (within the meaning of Section 13(d)
or 14(d) of the Exchange Act and the applicable rules and regulations
thereunder), or (b) during any period of 12 consecutive months, commencing after
the
-4-
Appendix A
Documentation Date, individuals who on the first day of such period were
directors of the Lessee (together with any replacement or additional directors
who were nominated or elected by a majority of directors then in office) cease
to constitute a majority of the Board of Directors of the Lessee.
"Claims" means any and all obligations, liabilities, losses, actions,
suits, judgments, penalties, fines, claims, demands, settlements, costs and
expenses (including reasonable legal fees and expenses) of any nature
whatsoever, but shall not include Taxes or Impositions.
"Clifton Property" means the Property located in Clifton, New Jersey and
described on Schedule III to the Participation Agreement.
"Code" means the Internal Revenue Code of 1986, as the same may be amended
from time to time.
"Commitment Percentage" means, with respect to any Investor, the
percentage set forth opposite such Investor's name under the heading "Commitment
Percentage" on Schedule I to the Participation Agreement, as such Schedule may
be amended, supplemented, amended and restated or otherwise modified from time
to time.
"Compliance with ISRA" is defined in Section 10.1(k) of the Participation
Agreement.
"Condemnation" means any condemnation, requisition, confiscation, seizure
or other taking or sale of the use, access, occupancy, easement rights or title
to any Property or any part thereof, wholly or partially (temporarily or
permanently), by or on account of any actual or threatened eminent domain
proceeding or other taking of action by any Person having the power of eminent
domain, including an action by a Governmental Authority to change the grade of,
or widen the streets adjacent to, such Property or alter the pedestrian or
vehicular traffic flow to such Property so as to result in change in access to
such Property, or by or on account of an eviction by paramount title or any
transfer made in lieu of any such proceeding or action. A "Condemnation" shall
be deemed to have occurred on the earliest of the dates that use, occupancy or
title vests in the condemning authority.
"Consolidated EBITDA" means, for any period, (a) Consolidated Net Income
for such period, plus (b) provisions for taxes based on income during such
period, plus (c) Consolidated Interest Expense for such period, plus (d) total
depreciation expense for such period, plus (e) total amortization expense for
such period, plus (f) restructuring charges recorded during such period minus
(g) cash expenditures during such period that are applied against restructuring
charges recorded during such period or any prior period, all of the foregoing as
determined on a consolidated basis for the Lessee and the Subsidiaries in
accordance with GAAP; provided there shall be excluded from such calculation the
net gains or losses associated with the sale of any asset not in the ordinary
course of business.
"Consolidated Interest Expense" means, for any period, the gross interest
expense of the Lessee and the Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP.
"Consolidated Net Income" means, for any period, net income or loss of the
Lessee and the Subsidiaries for such period determined on a consolidated basis
in accordance with GAAP.
"Consolidated Net Tangible Assets" means the total of all assets appearing
on a consolidated balance sheet of the Lessee and its Restricted Subsidiaries,
prepared in accordance with GAAP (and as of a date not more than 90 days prior
to the date as of which Consolidated Net Tangible Assets are to be determined),
less the sum of the following items as shown on said consolidated balance sheet:
-5-
Appendix A
(i) the book amount of all segregated intangible assets, including
such items as good will, trademarks, trademark rights, trade names, trade
name rights, copyrights, patents, patent rights and licenses and
unamortized debt discount and expense less unamortized debt premium;
(ii) all depreciation, valuation and other reserves;
(iii) current liabilities;
(iv) any minority interest in the shares of stock (other than
Preferred Stock) and surplus of Restricted Subsidiaries of the Lessee;
(v) the investment of the Lessee and its Restricted Subsidiaries in
any Unrestricted Subsidiary of the Lessee;
(vi) the total indebtedness of the Lessee and its Restricted
Subsidiaries incurred in any manner to finance or recover the cost to the
Lessee or any Restricted Subsidiary of any physical property, real or
personal, which prior to or simultaneously with the creation of such
indebtedness shall have been leased by the Lessee or a Restricted
Subsidiary to the United States of America or a department or agency
thereof at an aggregate rental, payable during that portion of the initial
term of such lease (without giving effect to any options of renewal or
extension) which shall be unexpired at the date of the creation of such
indebtedness, sufficient (taken together with any amounts required to be
paid by the lessee to the lessor upon any termination of such lease) to
pay in full at the stated maturity date or dates thereof the principal of
and the interest on such indebtedness;
(vii) deferred income and deferred liabilities; and
(viii) other items deductible under GAAP.
"Deed" means a limited warranty deed (or its equivalent) with respect to
the real property comprising a Leased Property, in conformity with Applicable
Law and appropriate for recording with the applicable Governmental Authorities,
conveying fee simple title to such real property to the Lessor, subject only to
Permitted Property Liens.
"Documentation Date" is defined in Section 2.1 of the Participation
Agreement.
"DOD Restrictions" is defined in Section 10.1(j) of the Participation
Agreement.
"Dollars" and "$" mean dollars in lawful currency of the United States.
"Environmental Audit" means, with respect to any Property, a Phase I
Environmental Site Assessment (the scope and performance of which meets or
exceeds the then most current ASTM Standard practice E1527 for Environmental
Site Assessments: Phase I Environmental Site Assessment Process or the All
Appropriate Inquiry rule, whichever is in effect at the time the Phase I
Environmental Site Assessment is conducted) of each Property.
"Environmental Laws" means any and all applicable federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
permits, licenses, authorizations, decrees or other legal requirement
regulating, relating to or imposing liability or standards of conduct concerning
protection of human health, the environment, natural resources (including
ambient air, surface water, groundwater, wetlands and surface or subsurface
strata, wildlife, aquatic species and vegetation) and the use, storage,
-6-
Appendix A
recycling, handling, disposal, discharge, transport, treatment or generation of
Hazardous Materials, as now or may at any time be in effect during the Lease
Term, including but not limited to, CERCLA, RCRA, the Clean Air Act, 42 USC
Section 7401 et seq., the Toxic Substances Control Act 15 USC Section 2601 et
seq. and any rules and regulations promulgated thereunder.
"Environmental Permit" means any consent, license, permit, permission,
grant, waiver, order, registration, authorization, approval, exemption or
similar right or privilege issued by any Governmental Authority pursuant to any
Environmental Law.
"Environmental Violation" means, with respect to any Property, any
activity, occurrence or condition that results in a notice of non-compliance
with any Environmental Law from any Governmental Authority.
"Equipment" means any equipment the removal of which could reasonably be
expected to affect the value or utility of any Land or Improvements, taken
together or separately, including heating, electrical, switch gear, power
supply, lighting, plumbing, ventilation, air conditioning and air cooling
systems, refrigerating equipment, generators, locking and unlocking equipment,
communication systems, sprinkler system and fire prevention systems, security
systems and fixtures of all kinds; provided, however, that the term "Equipment"
shall expressly exclude all inventory, furniture and furnishings.
"ERISA" means the Employee Retirement Income Security Act of 1974, as the
same may be amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Lessee, is treated as a single employer
under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in Section 4043
of ERISA or the regulations issued thereunder, with respect to a Plan; (b) the
adoption of any amendment to a Plan that would require the provision of security
pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA; (c) the
existence with respect to any Plan of an "accumulated funding deficiency" (as
defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (d) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (e) the incurrence of any liability under Title IV of ERISA
with respect to the termination of any Plan or the withdrawal or partial
withdrawal of the Lessee or any of its ERISA Affiliates from any Plan or
Multiemployer Plan; (f) the receipt by the Lessee or any ERISA Affiliate from
the PBGC or a plan administrator of any notice relating to the intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan; (g)
the receipt by the Lessee or any ERISA Affiliate of any notice that Withdrawal
Liability is being imposed or a determination that a Multiemployer Plan is, or
is expected to be, insolvent or in reorganization, within the meaning of Title
IV of ERISA; and (h) the occurrence of a "prohibited transaction" with respect
to which the Lessee or any of its Subsidiaries is a "disqualified person"
(within the meaning of Section 4975) of the Code, or with respect to which the
Lessee or any such Subsidiary could otherwise be liable.
"Event of Loss" means any Significant Casualty or any Significant
Condemnation.
"Excess Casualty/Condemnation Proceeds" is defined in Section 14.2(f) of
the Master Lease.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
-7-
Appendix A
"Existing Credit Agreement" means the Five-Year Competitive Advance and
Revolving Credit Facility Agreement dated as of November 10, 2000 among the
Lessee, the lenders named therein, The Chase Manhattan Bank, as issuing bank,
and The Chase Manhattan Bank, as administrative agent, as amended, supplemented,
amended and restated or otherwise modified from time to time.
"Expiration Date" means, with respect to the Master Lease, the earlier of
(a) the date the Master Lease shall have been terminated in accordance with the
provisions of the Master Lease and (b) the Scheduled Lease Termination Date.
"Expiration Date Purchase Obligation" means the Lessee's obligation,
pursuant to Section 18.1 of the Master Lease, to purchase all (but not less than
all) of the Leased Properties on the Expiration Date.
"Fair Market Sales Value" means, with respect to any Property, the amount,
which in any event shall not be less than zero, that would be paid in cash in an
arm's-length transaction between an informed and willing purchaser and an
informed and willing seller, neither of whom is under any compulsion to purchase
or sell, respectively, for the ownership of such Property.
"Fair Value", when used with respect to property, means the fair value as
determined in good faith by the board of directors of the Lessee.
"Fees" means the Structuring Fee described in Section 4.2 of the
Participation Agreement.
"Financial Officer" of any corporation means the chief financial officer,
principal accounting officer, treasurer, associate or assistant treasurer or
director of treasury services of such corporation.
"Fixed Rent" means, with respect to a Scheduled Payment Date, an amount
equal to (a) the sum of the Original Property Costs for each Leased Property
then subject to the Master Lease multiplied by (b) the percentage set forth on
Schedule I to the Master Lease under the column heading "Fixed Rent" for such
Scheduled Payment Date.
"Funding Office" means the office of each Investor identified on Schedule
II to the Participation Agreement as its funding office.
"GAAP" means United States generally accepted accounting principles,
applied on a consistent basis.
"Go Dark Value" means (a) with respect to any Leased Property acquired by
the Lessor on the Acquisition Date or any Mortgaged Property upon which a Lien
is granted to the Lessor on the Acquisition Date, the amount set forth on
Schedule III to the Participation Agreement as the "Go Dark Value of such
Property" and (b) with respect to any Replacement Property, an amount equal to
(x) the sum of the Go Dark Values of the applicable Terminated Properties
relating to such Replacement Property multiplied by (y) a fraction, the
numerator of which is the Fair Market Sales Value of such Replacement Property
as set forth in the Property Appraisal thereof and the denominator of which is
the aggregate Fair Market Sales Value of all Replacement Properties (including
such Replacement Property) acquired by or mortgaged to the Lessor on the same
Replacement Date as such Replacement Property and with respect to the same
Terminated Properties, in each case as set forth in the Property Appraisal
thereof.
"Governmental Action" means all permits, authorizations, registrations,
consents, approvals, waivers, exceptions, variances, orders, judgments, written
interpretations, decrees, licenses, exemptions, publications, filings, notices
to and declarations of or with, or required by, any Governmental Authority,
-8-
Appendix A
or required by any Applicable Law, including all Environmental Permits,
operating permits and licenses that are required for the full use, occupancy,
zoning and operation of any Property.
"Governmental Authority" means any Federal, state, local or foreign court
or governmental agency, authority, instrumentality or regulatory body.
"Hazardous Activity" means any activity, process, procedure or undertaking
that directly or indirectly (i) produces, generates or creates any Hazardous
Material; (ii) causes or results in (or threatens to cause or result in) the
Release of any Hazardous Material into the environment (including air, water
vapor, surface water, groundwater, drinking water, land (including surface or
subsurface), plant, aquatic and animal life); (iii) involves the containment or
storage of any Hazardous Material; or (iv) would be regulated as hazardous waste
treatment, storage or disposal within the meaning of any Environmental Law.
"Hazardous Materials" means any hazardous, toxic or dangerous materials,
explosives, substances, contaminants, chemicals, wastes or pollutants that from
time to time are defined by or pursuant to or are regulated under any
Environmental Laws, including asbestos, polychlorinated biphenyls, petroleum,
petroleum derivatives or by-products, other hydrocarbons, urea formaldehyde and
any material, substance, pollutant or waste that is now or hereafter defined,
prohibited, limited or regulated in any way under any Environmental Law.
"Impositions" means any and all liabilities, losses, expenses and costs of
any kind whatsoever for fees, taxes, levies, imposts, duties, charges,
assessments or withholdings of any nature whatsoever (all of the foregoing being
defined as "Taxes") (including: (i) real and personal property taxes, including
personal property taxes on any property covered by the Master Lease that is
classified by Governmental Authorities as personal property, and real estate or
ad valorem taxes in the nature of property taxes; (ii) sales taxes, use taxes
and other similar taxes (including rent taxes and intangibles taxes); (iii) any
excise taxes; (iv) real estate transfer taxes, conveyance taxes, mortgage taxes,
intangible taxes, stamp taxes and documentary recording taxes and fees; (v)
taxes that are or are in the nature of franchise, income, value added, gross
receipts, privilege and doing business taxes, license and registration fees;
(vi) assessments on any Property, including all assessments for public
improvements or benefits (whether or not such improvements are commenced or
completed within the Lease Term); (vii) all filing and reporting fees and
expenses relating thereto, for such Property; and (viii) all interest, additions
to tax and penalties), in each case that at any time may be levied, assessed or
imposed by any U.S. Federal, state or local authority upon or with respect to
(a) any Tax Indemnitee, any Property or any part thereof or interest therein, or
the Lessee or any sublessee or user of any Property; (b) the financing,
refinancing, demolition, construction, substitution, subleasing, assignment,
control, condition, occupancy, servicing, maintenance, repair, ownership,
possession, purchase, rental, lease, activity conducted on, delivery, insuring,
use, operation, improvement, transfer, return or other disposition of any
Property or any part thereof or interest therein; (c) the Property Cost, the
Termination Price or other indebtedness with respect to any Property or any part
thereof or interest therein or transfer thereof; (d) the rentals, receipts or
earnings arising from any Property or any part thereof or interest therein; (e)
the Operative Documents or any payment made or accrued pursuant thereto; (f) the
income or other proceeds received with respect to any Property or any part
thereof or interest therein upon the sale or disposition thereof; (g) any
contract relating to the construction, acquisition or delivery of the
Improvements or any part thereof or interest therein; (h) the issuance of the
Lessor Interests and payments and distributions with respect thereto; or (i)
otherwise in connection with the transactions contemplated by the Operative
Documents.
For the avoidance of doubt, the term "Imposition" also includes any Taxes
that are imposed by the government of France with respect to any period
occurring on or after the fifth anniversary of the
-9-
Appendix A
Documentation Date as a result of a change after the Acquisition Date in the
participation exemption regime applicable under the laws of France.
Notwithstanding anything in the first paragraph of this definition (except
as provided in the final paragraph of this definition) the term "Imposition"
shall not mean or include:
(i) Taxes (other than Taxes that are, or are in the nature of,
withholding, sales, use, rental, value added transfer or property taxes)
that are imposed by the U.S. federal government and that are based upon or
measured by or with respect to the net income (including any minimum
taxes, capital gains taxes, or taxes on, measured by or with respect to or
in the nature of capital, net worth, excess profits, items of tax
preference and capital stock) of any Tax Indemnitee; provided, that this
clause (i) shall not be interpreted to prevent a payment from being made
on an After Tax Basis if such payment is otherwise required to be so made
and provided, further, that Taxes described in this clause (i) shall not
include Taxes that are, or are in the nature of, withholding, sales, use,
rental, value added, transfer or property taxes;
(ii) Taxes (other than Taxes that are, or are in the nature of,
withholding, sales, use, rental, value added, transfer or property taxes)
that are (A) imposed by any U.S. state jurisdiction or any taxing
authority within any U.S. state jurisdiction to the extent that such Tax
Indemnitee is organized or has its Funding Office in such jurisdiction and
(B) based upon or measured by income, except that this clause (ii) shall
not apply to (and thus shall not exclude) any such Taxes imposed on a Tax
Indemnitee by a state or political subdivision thereof where any Property
is located, possessed or used under the Master Lease unless the Tax
Indemnitee was subject to income taxes in such jurisdiction without regard
to the transactions contemplated by the Operative Documents; provided,
that this clause (ii) shall not be interpreted to prevent a payment from
being made on an After Tax Basis if such payment is otherwise required to
be so made;
(iii) Taxes that are imposed by the government of France with
respect to any period occurring prior to the fifth anniversary of the
Documentation Date as a result of a change after the Acquisition Date in
the participation exemption regime applicable under the laws of France;
(iv) any Tax with respect to any Property to the extent, but only to
such extent, it relates to any act, event or omission that occurs, or
relates to a period, after the termination of the Master Lease and the
payment of all Obligations, except that when such termination of the
Master Lease is the result of the exercise of remedies after a Lease Event
of Default, such exclusion shall commence only after the sale of all of
the Lessor's interest in all of the Leased Properties and the foreclosure
by the Lessor on all of the Lessee's interests in the Mortgaged
Properties; provided, that the Taxes described in this clause (iv) shall
not include any Tax or Imposition that relates to any period prior to the
expiration or earlier termination of the last Lease Term to expire or
otherwise terminate;
(v) any interest or penalties imposed on a Tax Indemnitee as a
result of a Tax Indemnitee's failure to file any return or other documents
timely and as prescribed by Applicable Law; provided, that this clause
(iv) shall not apply (A) if such interest or penalties arise as a result
of a position taken (or requested to be taken) by the Lessee in a contest
controlled by the Lessee under Section 13.4(b) of the Participation
Agreement or (B) if such failure is attributable to a failure by the
Lessee to fulfill its obligations under the Participation Agreement and
other Operative Documents;
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Appendix A
(vi) any Taxes imposed upon a Tax Indemnitee with respect to any
voluntary transfer, sale, financing or other voluntary disposition of any
interest in any Property or any part thereof, or any interest therein or
any interest or obligation under the Operative Documents or from any sale,
assignment, transfer or other disposition of any interest in a Tax
Indemnitee or any Affiliate thereof (other than any transfer, sale or
other disposition (A) pursuant to the terms of the Operative Documents in
connection with the exercise by the Lessee of its Termination Option,
Replacement Option or Return Option or any other purchase of any Property
by the Lessee or any release or termination of any Lessor Mortgage by the
Lessor at the request of the Lessee, (B) after the occurrence of a Lease
Event of Default, (C) in connection with a Casualty or Condemnation
affecting any Property or (D) in connection with any sublease (or lease,
in the case of a Mortgaged Property), modification or addition to any
Property by the Lessee);
(vii) any Taxes imposed against or payable by a Tax Indemnitee to
the extent resulting from, or that would not have been imposed but for,
the gross negligence or willful misconduct of such Tax Indemnitee;
(viii) Taxes imposed on or payable by a Tax Indemnitee to the extent
such Taxes solely result from, or would not have been imposed solely but
for, a breach by such Tax Indemnitee of any representations, warranties or
covenants set forth in the Operative Documents (unless such breach is
caused by the Lessee's breach of its representations, warranties or
covenants set forth in the Operative Documents);
(ix) Taxes imposed on a Tax Indemnitee to the extent resulting from
such Tax Indemnitee's failure to comply with the provisions of Section
13.4(b) of the Participation Agreement, which failure precludes the
ability to conduct a contest pursuant to Section 13.4(b) of the
Participation Agreement (unless such failure is caused by the Lessee's
breach of its obligations under the Operative Documents);
(x) Taxes that would have been imposed in the absence of the
transactions contemplated by the Operative Documents;
(xi) Taxes imposed on or with respect to or payable by a Tax
Indemnitee solely resulting from, or that would not have been imposed
solely but for the existence of, any Lessor Lien created by or through
such Tax Indemnitee or an Affiliate thereof, unless caused by acts or
omissions of the Lessee;
(xii) Taxes imposed on or with respect to or payable by a Tax
Indemnitee that would not have been imposed but for an amendment,
supplement, modification, consent or waiver to any Operative Document not
initiated, requested or consented to by the Lessee, unless such amendment,
supplement, modification, consent or waiver (A) arises due to, or in
connection with there having occurred a Lease Event of Default or (B) is
required by the terms of the Operative Documents or is executed in
connection with any amendment to the Operative Documents required by
Applicable Law;
(xiii) any Tax imposed against or payable by a Tax Indemnitee that
is a direct or indirect transferee or assignee of an original Tax
Indemnitee to the extent that, based on the Applicable Law in effect on
the date such Tax is imposed or becomes payable, the amount of such Tax
exceeds the amount of such Tax that would have been imposed against or
payable by such original Tax Indemnitee;
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Appendix A
(xiv) any fines, penalties, interest or costs for nonpayment or late
payment of any Tax resulting from a failure by the Lessor to provide
notice to the Lessee of any tax assessment, levy, duty or other xxxx
within the time period required by Section 17.2 of the Master Lease; and
(xv) Taxes that are or are in the nature of franchise, income, value
added, gross receipts, privilege or doing business taxes and are imposed
by any taxing jurisdiction where the applicable Tax Indemnitee's
activities other than its participation in the transactions contemplated
by the Participation Agreement, the Master Lease and the Lease Supplements
have created or could create taxable nexus.
Notwithstanding the foregoing, the exclusions from the definition of
Impositions set forth in clauses (i) through (xv) (other than clause (iii))
above shall not apply to any Taxes or any increase in Taxes imposed on a Tax
Indemnitee as the result of any non-superseded determination by the applicable
taxing authority that the transactions contemplated by the Operative Documents
should be treated other than as a financing arrangement tantamount to a loan
secured by the Properties for the relevant jurisdiction's tax purposes.
"Improvements" means all buildings, structures, fixtures, Equipment and
other improvements of every kind existing at any time and from time to time on
or under any parcel of Land to be acquired or leased pursuant to the terms of
the Operative Documents, together with any and all appurtenances to such
buildings, structures or improvements, including sidewalks, utility pipes,
conduits and lines, parking areas and roadways, and including all Modifications
and other additions to or changes in the Improvements at any time; provided
however that the term "Improvements" shall expressly exclude all trade fixtures
purchased or otherwise acquired by the Lessee using funds other than the
proceeds of the Property Costs.
"Indebtedness" of any Person means all indebtedness representing money
borrowed or the deferred purchase price of property (other than trade accounts
payable) or any capitalized lease obligation, which in any case is created,
assumed, incurred or guaranteed in any manner by such corporation or for which
such corporation is responsible or liable (whether by agreement to purchase
indebtedness of, or to supply funds to or invest in, others or otherwise).
"Indemnitee" means the Lessor, the Lessor Administrator, each Investor,
the Arranger, their respective Affiliates and their respective successors,
assigns, directors, shareholders, partners, members, officers, employees and
agents.
"Insurance Requirements" means the terms and conditions of any insurance
policy, and the requirements of the issuer of any such policy, which insurance
policy is required to be maintained by the Lessee under the Master Lease, in
each case the failure to comply with which terms, conditions and/or requirements
would under applicable law or the terms of such insurance policy constitute a
valid defense to the insurer against payment of insurance proceeds thereunder.
"Investors" means, collectively, Air Bail S.A.S., a French corporation
duly registered as a Societe par Actions Simplifiee, and RBS Lombard, Inc., a
New York corporation.
"IRS" is defined in Section 2.1(m) of the Participation Agreement.
"ISRA" means the New Jersey Industrial Site Recovery Act, N.J.S.A. 13:K
and its implementing regulations N.J.A.C. 7:26 B.
-12-
Appendix A
"Land" means each individual fee interest in real property described on
Schedule I to each Lease Supplement or described in a Lessor Mortgage that is
not also a Lease Supplement, together with, in each case, all Appurtenant Rights
attached thereto.
"Lease" means, collectively, the Master Lease and each Lease Supplement.
"Lease Balance" means, as of any date of determination, an amount equal to
the aggregate Termination Prices for all Properties plus all accrued and unpaid
Accrual Rent and all Supplemental Rent then owing (after giving effect to the
consummation of any termination, purchase or other transaction occurring on such
date pursuant to the Operative Documents).
"Lease Default" means any event or condition that, with the lapse of time
or the giving of notice, or both, would constitute a Lease Event of Default.
"Leased Property" means, on any date, each real property then leased by
the Lessor to the Lessee pursuant to the Master Lease, including each parcel of
Land described on a Schedule I to a Lease Supplement and all of the Improvements
at any time located on or under such Land and including, until any such Property
is terminated or replaced in accordance with the Master Lease, each real
property described as a "Leased Property" on Schedule III to the Participation
Agreement.
"Lease Event of Default" is defined in Section 16.1 of the Master Lease.
"Lease Supplement" means each Lease Supplement substantially in the
applicable form set forth in Exhibit A to the Master Lease, executed by the
Lessee, the Lessor and, if appropriate in the applicable jurisdiction, the
trustee described therein, dated the Acquisition Date or a Replacement Date and
covering the Land identified on Schedule I thereto and Improvements thereon, as
the same may be amended, supplemented, amended and restated or otherwise
modified from time to time.
"Lease Term" means, with respect to each Property, the period commencing
on (and including) the Acquisition Date for such Property (or, if such Property
is a Replacement Property, the Replacement Date for such Property) and ending on
(but excluding) the earlier of (x) the date on which such Property has been
returned to the Lessor pursuant to the Lessee's Return Option or transferred to
the Lessee pursuant to the Lessee's Termination Option or Replacement Option, in
each case, strictly in accordance with the Master Lease, and (y) the Expiration
Date.
"Lessee" means ITT Industries, Inc., an Indiana corporation.
"Lessee Subsidiary" means a subsidiary of the Lessee.
"Lessor" means Rexus L.L.C., a Delaware limited liability company.
"Lessor Administration Agreement" means the Lessor Administration
Agreement, dated as of December 15, 2004, between the Lessor and the Lessor
Administrator.
"Lessor Administrator" means Societe Generale (Canada), wholly-owned
(directly or indirectly) by Societe Generale.
"Lessor Commitment Amount" means, on any date, $120,000,000.
"Lessor Financing Statements" means UCC financing statements appropriately
completed and executed for filing in the applicable jurisdiction in order to
protect the Lessor's interests under the Master
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Appendix A
Lease and each Lease Supplement to the extent the Master Lease and the Lease
Supplements are security agreements.
"Lessor Interest" means an "Interest" as defined in the Lessor LLC
Agreement.
"Lessor Lien" means any Lien arising as a result of (a) any claim against
the Lessor or any Investor not resulting from the transactions contemplated by
the Operative Documents, (b) any act or omission of the Lessor or any Investor
that is not required or permitted by the Operative Documents or is in violation
of any of the terms of the Operative Documents or (c) any claim against the
Lessor or any Investor with respect to Taxes or Transaction Expenses against
which the Lessee is not required to indemnify such Person pursuant to Article IX
or XIII of the Participation Agreement.
"Lessor LLC Agreement" means the Limited Liability Company Agreement of
Rexus L.L.C. dated as of December 15, 2004, made and entered into by the
Investors.
"Lessor Mortgage" means, with respect to each Property, the applicable
Lease Supplement for such Property (if such Property is a Leased Property) and
any and all other mortgages, deeds of trust and security instruments in
appropriate recordable form in the relevant jurisdiction sufficient to grant to
the Lessor a first priority Lien on such Property.
"Lien" means, with respect to any property or asset, any mortgage, deed of
trust, lien, pledge, security interest, charge or other encumbrance on, of, or
in such property or asset.
"Margin Regulations" means Regulations T, U and X of the Board as from
time to time in effect, and all official rulings and interpretations thereunder
or thereof.
"Margin Stock" has the meaning given such term under Regulation U of the
F.R.S. Board.
"Master Lease" means the Master Lease and Deed of Trust, Deed to Secure
Debt and Mortgage, dated as of December 15, 2004, between the Lessor and the
Lessee, as the same may be amended, supplemented, amended and restated or
otherwise modified from time to time.
"Material Adverse Effect" means a materially adverse effect on the
business, assets, operations or condition, financial or otherwise, of the Lessee
and Lessee Subsidiaries taken as a whole.
"Modifications" is defined in Section 10.1 of the Master Lease.
"Moody's" means Xxxxx'x Investors Service, Inc. or any of its successors.
"Mortgaged Property" means, on any date, each real property that is then
subject to a Lessor Mortgage and is not a Leased Property, including, until any
such Property is terminated or replaced in accordance with the Master Lease,
each real property described as a "Mortgaged Property" on Schedule III to the
Participation Agreement.
"Mortgage Foreclosure Act" is defined in Section 16.4 of the Master Lease.
"Multiemployer Plan" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA to which the Lessee or any ERISA Affiliate (other than one
considered an ERISA Affiliate only pursuant to subsection (m) or (o) of Code
Section 414) is making or accruing an obligation to make contributions, or has
within any of the preceding five plan years made or accrued an obligation to
make contributions.
-14-
Appendix A
"Net Proceeds" means the aggregate of all awards, compensation, insurance
proceeds or other amounts received by the Lessor or any Investor in connection
with any Casualty or Condemnation of any Property and all interest earned
thereon, less, to the extent not previously reimbursed by the Lessee, the
expense of claiming and collecting such amounts, including all costs and
expenses in connection therewith for which the Lessor or any Investor is
entitled to be reimbursed pursuant to the Lease.
"NFA Letter" is defined in Section 10.1(k) of the Participation Agreement.
"NJDEP" means the New Jersey Department of Environmental Protection.
"Non-U.S. Transferee" is defined in Section 12.3 of the Participation
Agreement.
"Obligations" means all obligations (monetary or otherwise) of the Lessee
arising under or in connection with any of the Operative Documents.
"Operative Documents" means the following:
(a) the Participation Agreement;
(b) the Master Lease;
(c) each Lease Supplement;
(d) the Lessor LLC Agreement;
(e) the Lessor Administration Agreement;
(f) each Deed;
(g) each Lessor Mortgage;
(h) the Lessor Financing Statements; and
(i) each other document, agreement, certificate or instrument
delivered in connection with any of the foregoing (including any amendment
or other modification to any of the foregoing).
"Original Executed Counterpart" is defined in Section 26.9 of the Master
Lease.
"Original Property Cost" means (a) with respect to any Leased Property
acquired by the Lessor on the Acquisition Date, the amount set forth on Schedule
III to the Participation Agreement as the "Original Property Cost" of such
Property and (b) with respect to any Replacement Property that is or is to be a
Leased Property, an amount equal to (x) the sum of the Original Property Costs
of the applicable Terminated Properties relating to such Replacement Property
multiplied by (y) a fraction, the numerator of which is the Fair Market Sales
Value of such Replacement Property as set forth in the Property Appraisal
thereof and the denominator of which is the aggregate Fair Market Sales Value of
all Replacement Properties (including such Replacement Property) acquired by the
Lessor on the same Replacement Date as such Replacement Property and with
respect to the same Terminated Properties, in each case as set forth in the
Property Appraisal thereof.
-15-
Appendix A
"Overdue Rate" means, for each applicable day, a rate per annum equal to
the Overnight LIBOR for such day plus 200 basis points.
"Overnight LIBOR" means, on any day, the rate appearing on Page 3750 of
the Telerate Service (or on any successor or substitute page of such Service, or
any successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Lessor from time to time for purposes of providing quotations
of interest rates applicable to dollar deposits in the London interbank market)
at approximately 11:00 a.m., London time, two Business Days prior to such day,
as the rate for overnight dollar deposits on such day.
"Partial Termination Date" is defined in Section 15.2 of the Master Lease.
"Partial Termination Notice" is defined in Section 15.1 of the Master
Lease.
"Participation Agreement" means the Participation Agreement, dated as of
December 15, 2004, among the Lessee, the Lessor and the Investors, as the same
may be amended, supplemented, amended and restated or otherwise modified from
time to time.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA.
"Permitted Property Liens" means, with respect to any Property, any of the
following:
(i) the respective rights and interests of the parties to the
Operative Documents as provided in the Operative Documents (including any
Lien created pursuant to the Operative Documents);
(ii) the rights of any sublessee under a sublease and, in the case
of a Mortgaged Property, the rights of any lessee under a lease, in each
case to the extent such sublease or lease is permitted by the terms of the
Master Lease;
(iii) Liens for Taxes that either are not yet due or are being
contested in accordance with the provisions of Section 12.1 of the Master
Lease;
(iv) Liens arising by operation of law, materialmen's, mechanics',
workers', repairmen's, employees', carriers', warehousemen's and other
like liens in connection with any Modifications made subsequent to the
Acquisition Date or arising in the ordinary course of business in
connection with actions occurring after the Acquisition Date for amounts
that either are not more than sixty (60) days past due or are being
diligently contested in good faith by appropriate proceedings, so long as
such proceedings satisfy the conditions for the contest proceedings set
forth in Section 12.1 of the Master Lease;
(v) Liens of any of the types referred to in clause (iii) or (iv)
above that have been bonded for not less than the full amount in dispute
(or as to which other security arrangements satisfactory to the Lessor
have been made), which bonding (or arrangements) complies with Applicable
Law and has effectively stayed any execution or enforcement of such Liens;
(vi) Liens arising out of judgments or awards with respect to which
appeals or other proceedings for review are being prosecuted in good faith
and for the payment of which adequate reserves have been provided as
required by GAAP or other appropriate provisions have been made, so long
as such proceedings have the effect of staying the execution of such
judgments or
-16-
Appendix A
awards and satisfy the conditions for contest proceedings set forth in
Section 12.1 of the Master Lease;
(vii) easements, licenses, rights-of-way and other encumbrances on
title to real property permitted pursuant to Section 11.2 of the Master
Lease;
(viii) Lessor Liens;
(ix) Liens created by the Lessee with the consent of the Lessor or
otherwise permitted by the Operative Documents; and
(x) any Liens described on the applicable Lease Supplement that are
consented to by the Lessor in its sole discretion.
"Person" shall mean an individual, partnership, limited liability company,
corporation, trust or unincorporated organization, and a government or agency or
political subdivision thereof.
"Plan" means any employee pension benefit plan (other than a Multiemployer
Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code
or Section 307 of ERISA, and in respect of which the Lessee or any ERISA
Affiliate is (or, if such plans were terminated, would under Section 4069 of
ERISA be deemed to be) an "employer" as defined in Section 3(5) of ERISA.
"Plans and Specifications" means, with respect to each Property, the final
plans and specifications or detailed construction drawings for such Property.
"Preferred Stock" means any capital stock entitled by its terms to a
preference (a) as to dividends or (b) upon a distribution of assets.
"Principal Property" means any single manufacturing or processing facility
owned by the Lessee or any Restricted Subsidiary having a gross book value in
excess of the greater of (i) 5% of Consolidated Net Tangible Assets and (ii)
$40,000,000, except any such facility or portion thereof which the board of
directors of the Lessee by resolution declares is not of material importance to
the total business conducted by the Lessee and its Restricted Subsidiaries as an
entirety.
"Property" means any Leased Property or any Mortgaged Property; and
"Properties" means all Leased Properties and all Mortgaged Properties,
collectively.
"Property Appraisal" means, with respect to any Replacement Property, the
Appraisal thereof delivered pursuant to Section 19.2 of the Master Lease.
"Property Cost" means, with respect to any Leased Property as of any date,
(a) the Original Property Cost for such Property less (b) the aggregate Property
Fixed Rent paid by the Lessee prior to such date for such Leased Property and,
if such Property is a Replacement Property, the aggregate Property Fixed Rent
paid with respect to the Property so replaced (to the extent allocable to such
Leased Property) less (c) any Allocated Payments paid with respect to such
Property.
"Property Fixed Rent" means the portion of Fixed Rent due on any Scheduled
Payment Date that is allocable to any particular Leased Property, with such
allocation to be made by the Lessor based on the ratio of the Property Cost of
such Property to the Aggregate Property Cost (in each case determined prior to
such payment of Fixed Rent on such Scheduled Payment Date).
-17-
Appendix A
"Purchase Option" is defined in Section 18.1 of the Master Lease.
"Rating Agencies" means Moody's and S&P.
"Ratings" means the ratings from time to time established by the Rating
Agencies for senior, unsecured, non-credit-enhanced long-term debt of the
Lessee.
"RCRA" means the Resource Conservation and Recovery Act of 1976, as
amended by the Solid and Hazardous Waste Amendments of 1984, 42 U.S.C. Sections
6901 et seq.
"Recognized Environmental Condition" means the presence or likely presence
of any Hazardous Materials or petroleum products on a property under conditions
that indicate an existing Release, a past Release or a material threat of a
Release of any Hazardous Material or petroleum products into structures on the
property or into the ground, groundwater or surface water of the property.
"Release" means any release, pumping, pouring, emptying, injecting,
escaping, leaching, dumping, seepage, spill, leak, flow, discharge, disposal,
depositing, dispersal, migration or emission into the indoor or outdoor
environment, including the movement of Hazardous Materials through ambient air,
soil, surface water, groundwater, wetlands, land or subsurface strata.
"Remedial Action" means (a) "remedial action" as such term is defined in
CERCLA, and (b) all other actions required by any Governmental Authority or
voluntarily undertaken to: (i) clean up, remove, treat, xxxxx or in any other
way address any Hazardous Materials in the environment; (ii) prevent the Release
or threat of Release, or minimize the further Release, of any Hazardous
Materials so that it does not migrate or endanger or threaten to endanger public
health, welfare or the environment; or (iii) perform studies and investigations
in connection with, or as a precondition to, any action described in clause (i)
or (ii) above.
"Remediation In Progress Waiver" means the waiver described in Section
6.1(j) of the Participation Agreement.
"Rent" means, collectively, the Basic Rent and the Supplemental Rent, in
each case payable under the Master Lease.
"Rent Period" means each period commencing on (but excluding) a Scheduled
Payment Date (or, in the case of the initial Rent Period, commencing on (and
including) the Acquisition Date) and ending on (and including) the next
succeeding Scheduled Payment Date.
"Replacement Date" is defined in Section 19.2(a) of the Master Lease.
"Replacement Notice" is defined in Section 19.2(a) of the Master Lease.
"Replacement Option" is defined in Section 19.2 of the Master Lease.
"Replacement Property" is defined in Section 19.2(a) of the Master Lease.
"Requesting Party" is defined in Section 22.1 of the Master Lease.
"Required Modification" is defined in Section 10.1 of the Master Lease.
-18-
Appendix A
"Responsible Officer" of any corporation means any executive officer or
the chief financial officer, principal accounting officer or treasurer of such
corporation and any other officer or similar official thereof responsible for
the administration of the obligations of such corporation in respect of the
Operative Documents.
"Responsible Officer's Certificate" means a certificate signed by any
Responsible Officer, which certificate shall certify as true and correct the
subject matter being certified to in such certificate.
"Restricted Subsidiary" means any Lessee Subsidiary other than an
Unrestricted Subsidiary.
"Return Conditions" is defined in Section 20.1 of the Master Lease.
"Return Option" is defined in Section 20.1 of the Master Lease.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc., or any of its successors.
"Sale Termination Event" is defined in clause (iii) of Section 19.1(a) of
the Master Lease.
"Scheduled Lease Termination Date" means December 17, 2014.
"Scheduled Payment Date" means each December 31 of each calendar year and
the Scheduled Lease Termination Date, or if any such day is not a Business Day,
the immediately preceding Business Day.
"SEC" means the Securities and Exchange Commission or any Governmental
Authority succeeding to any of its principal functions.
"Securities Act" means the Securities Act of 1933, as amended from time to
time.
"Seller" means, with respect to any Leased Property, the Lessee or, with
the consent of the Lessor, any other Person transferring such Property to the
Lessor on the Acquisition Date.
"Significant Casualty" with respect to a Property means a Casualty that in
the reasonable, good faith judgment of the Lessor (a) renders such Property
unsuitable for continued use in accordance with its intended use or (b) is so
substantial in nature that restoration of such Property to substantially its
condition as it existed immediately prior to such Casualty would be
impracticable or impossible.
"Significant Condemnation" with respect to a Property means (a) a
Condemnation that involves a taking of the Lessor's entire title to the Land or
Improvements, or (b) a Condemnation that in the reasonable, good faith judgment
of the Lessor (i) renders such Property unsuitable for continued use in
accordance with its intended use or (ii) is so substantial in nature that
restoration of the remaining portion of such Property to substantially its
condition as it existed immediately prior to such Condemnation would be
impracticable or impossible.
"Structuring Fee" means the "Arrangement Fee" payable to the Arranger and
described in the Arrangement Letter.
"Subject Property" is defined in each Lease Supplement and, as used in the
Participation Agreement and the Master Lease, means each applicable Property (x)
being acquired by the Lessor on the
-19-
Appendix A
applicable Acquisition Date or Replacement Date or (y) being mortgaged by the
Lessee to the Lessor on the applicable Acquisition Date or Replacement Date.
"Subsidiary" means, with respect to any person (the "parent"), any
corporation, association or other business entity of which securities or other
ownership interests representing more than 50% of the ordinary voting power are,
at the time as of which any determination is being made, owned or controlled by
the parent or one or more subsidiaries of the parent or by the parent and one or
more subsidiaries of the parent.
"Supplemental Rent" means all amounts, liabilities and obligations (other
than Basic Rent) that the Lessee assumes or agrees to pay to the Lessor, any
Investor or the Arranger under any of the Operative Documents, including amounts
for rent, taxes and insurance, Fees, Break Costs, amounts due pursuant to
Article IX or XIII of the Participation Agreement and payments pursuant to
Section 15.2 of the Master Lease or Article XVIII, XIX or XX of the Master
Lease.
"Survey" means an ALTA/ACSM survey of the Subject Property (and all
Improvements thereon) (i) prepared by a surveyor or engineer licensed to perform
surveys in the jurisdiction in which such Subject Property is located, (ii)
dated (or redated) not earlier than six months prior to the date of delivery
thereof, (iii) complying in all respects with the minimum detail requirements of
the American Land Title Association as such requirements are in effect on the
date of preparation of such survey (including all Table A requirements) and (iv)
sufficient for a title company to remove all standard survey exceptions from a
title insurance policy (or commitment) relating to such Subject Property and
issue customary endorsements thereto.
"Tax Indemnitee" means the Lessor, the Lessor Administrator, each
Investor, the Arranger, their respective Affiliates and their respective
successors, assigns, directors, shareholders, partners, members, officers,
employees and agents.
"Taxes" is defined in the definition of Impositions.
"Terminated Property" is defined in Section 19.1(a) of the Master Lease.
"Termination Base Amount" means, with respect to any Property on any date,
an amount equal to (I) (a) 150% multiplied by (b) the Go Dark Value for such
Property multiplied by (c) the Aggregate Property Cost on such date divided by
(II) the Aggregate Original Property Cost on such date; provided, that any
reference in any Operative Document to the "unamortized" Termination Base Amount
of any Property shall mean 150% of the Go Dark Value for such Property.
"Termination Date" is defined in Section 19.1(a) of the Master Lease.
"Termination Event" is defined in Section 19.1(a) of the Master Lease.
"Termination Indemnity Amount" means with respect to any Property on any
date, (a) if such date occurs on or prior to the fifth anniversary of the
Acquisition Date, 1.0% of the Termination Base Amount of such Property and (b)
if such date occurs after the fifth anniversary of the Acquisition Date, 0.5% of
the Termination Base Amount of such Property; provided, however, that the
Termination Indemnity Amount shall be zero in the case of (x) the Lessee's
exercise of its Termination Option with respect to a Property that has suffered
an Event of Loss outside of the control of the Lessee and its Affiliates or (y)
the Lessee's exercise of its Termination Option with respect to all of the
Properties pursuant to clause (ii) of Section 19.1(a) of the Master Lease or (z)
the Lessee's purchase of all of the Properties during the continuance of a Lease
Event of Default described in clause (m), (o) or (p) of
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Appendix A
Section 16.1 of the Lease the occurrence and continuance of which is outside of
the control of the Lessee and its Affiliates.
"Termination Notice" is defined in Section 19.1(a) of the Master Lease.
"Termination Option" is defined in Section 19.1(a) of the Master Lease.
"Termination Price" means, with respect to any Property on any date, the
sum of (a) the Termination Base Amount for such Property on such date plus (b)
the Termination Indemnity Amount (if any) for such Property on such date.
"Title Abstract" is defined in Section 6.1(e) of the Participation
Agreement.
"Title Insurance Policy" means a policy of title insurance issued by a
nationally recognized title insurance company that is rated no lower than "AA-"
(by S&P) and no lower than "Aa3" (by Moody's) and approved by the Lessor (which
approval shall not be unreasonably withheld or delayed), insuring the Lessor's
fee, leasehold or mortgagee interest (as applicable) in the applicable Property
and the first lien priority of (x) in the case of a Leased Property, the Master
Lease, the Lease Supplement and any other applicable Lessor Mortgage applicable
to such Property and (y) in the case of a Mortgaged Property, the Lessor
Mortgage applicable to such Property, and subject to no Liens (including any
easements, covenants, leases, agreements or other items), claims or lawsuits
except as may be approved in writing by the Lessor its sole discretion.
"Transaction Expenses" means all costs and expenses incurred in connection
with the preparation, execution and delivery of the Operative Documents and the
transactions contemplated by the Operative Documents including:
(a) the reasonable fees, out-of-pocket expenses and disbursements of
Xxxxx Day, special counsel for Air Bail S.A.S., in negotiating the terms
of the Operative Documents and the other transaction documents, preparing
for the closings under (including the transactions contemplated to occur
on the Acquisition Date, each Termination Date and each Replacement Date),
and rendering opinions in connection with, the transactions contemplated
thereby and in rendering other services customary for counsel representing
parties to transactions of the types involved in the transactions
contemplated by the Operative Documents;
(b) (i) the reasonable fees, out-of-pocket expenses and
disbursements of special counsel for the Lessee, in negotiating the terms
of the Operative Documents and the other transaction documents, preparing
for the closings under, and rendering opinions in connection with, the
transactions contemplated thereby and in rendering other services in
connection with the transactions contemplated thereby customary for
counsel representing parties to transactions of the types involved in the
transactions contemplated by the Operative Documents, and the reasonable
fees, out-of-pocket expenses and disbursements of special counsel for the
Lessee in connection with the transactions contemplated to occur on each
Acquisition Date; and (ii) the reasonable fees, out-of-pocket expenses and
disbursements of local counsel for the Lessee in each applicable
jurisdiction in negotiating the terms of the Operative Documents and the
other transaction documents, preparing for the closings under, and
rendering opinions in connection with, the transactions contemplated to
occur on each Acquisition Date and in rendering other services in
connection with the transactions contemplated by the Operative Documents
which are customary for counsel representing parties to transactions of
the types involved in the transactions contemplated by the Operative
Documents;
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Appendix A
(c) any and all Taxes and fees incurred in recording, registering or
filing any Operative Document or any other transaction document, any deed,
declaration, mortgage, security agreement, notice or financing statement
with any public office, registry or governmental agency required by the
Operative Documents in connection with the transactions contemplated by
the Operative Documents;
(d) all reasonable out-of-pocket expenses, disbursements and costs
of the Arranger, the Investors, the Lessor and the Lessor Administrator
paid or incurred in connection with the transactions contemplated by the
Operative Documents (including the transactions contemplated to occur on
the Acquisition Date, each Termination Date and each Replacement Date);
(e) all fees, premiums and escrow costs and other expenses relating
to title abstracts and the closings contemplated by the Operative
Documents;
(f) all expenses relating to Environmental Audits required to be
delivered pursuant to Section 6.1(c) of the Participation Agreement or
required to be delivered in connection with the Lessee's exercise of its
Replacement Option;
(g) all fees and other expenses relating to Appraisals delivered to
the Investors prior to the Acquisition Date or required to be delivered in
connection with the Lessee's exercise of its Replacement Option; and
(h) the Fees payable by the Lessee pursuant to the Participation
Agreement.
"Transactions" is defined in Section 8.1(b) of the Participation
Agreement.
"Uniform Commercial Code" and "UCC" means the Uniform Commercial Code as
in effect in any applicable jurisdiction.
"United States" or "U.S." means the United States of America.
"Unrestricted Subsidiary" means (a) any Lessee Subsidiary which has been
designated an Unrestricted Subsidiary by resolution of the board of directors of
the Lessee (which resolution has been communicated in a notice delivered by the
Lessee to the Lessor) as an Unrestricted Subsidiary, other than any such Lessee
Subsidiary as to which such a designation has been rescinded by resolution of
said board of directors and not hereafter, or after some subsequent such
rescission, restored by resolution of said board, or (b) any Lessee Subsidiary
50% or less of the Voting Shares of which is owned directly by the Lessee and/or
one or more Restricted Subsidiaries. A Lessee Subsidiary may not be designated
as (or otherwise permitted to become) an Unrestricted Subsidiary unless,
immediately after such Subsidiary becomes an Unrestricted Subsidiary, such
Lessee Subsidiary would not own any capital stock of, or hold any indebtedness
of, any Restricted Subsidiary. A designation as an Unrestricted Subsidiary may
not be rescinded (or an Unrestricted Subsidiary otherwise permitted to become a
Restricted Subsidiary) unless such Lessee Subsidiary (i) is not a party to any
lease which it would have been prohibited by the Participation Agreement from
entering into had it been a Restricted Subsidiary at the time it entered into
such lease, unless (x) such Lessee Subsidiary had not been a Restricted
Subsidiary prior to its entering into such lease, or (y) the property subject to
such lease shall be owned by the Lessee and/or one or more Lessee Subsidiaries,
or (z) such Lessee Subsidiary would not be prohibited by the Participation
Agreement from entering into such lease immediately after it becomes a
Restricted Subsidiary, and (ii) does not have outstanding upon any of its
property any mortgage, pledge or other lien which it would be prohibited by the
Participation Agreement from creating, suffering to be created, or assuming,
immediately after it becomes a Restricted Subsidiary.
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Appendix A
"U.S. Transferee" is defined in Section 12.3 of the Participation
Agreement.
"Voting Shares" means, as to a particular corporation or other person,
outstanding shares of stock or other equity interests of any class of such
person entitled to vote in the election of directors, or otherwise to
participate in the direction of the management and policies, of such person,
excluding shares or interests entitled so to vote or participate only upon the
happening of some contingency.
"Withdrawal Liability" shall have the meaning given such term under Part I
of Subtitle E of Title IV of ERISA.
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