Nature of the Transaction. It is the intent of the parties that: (a) the Lease constitutes an operating lease from the Lessor to the Lessees for purposes of the Lessees' financial reporting, (b) the Lease and other transactions contemplated hereby preserve ownership in the Properties in the Lessees for Federal and state income tax and bankruptcy purposes, (c) each Lease Supplement grants to Lessor a Lien on the Property covered thereby, and (d) the obligations of the Lessees to pay Basic Rent (Interest/Yield) and any part of any Property Balance (other than Basic Rent (Interest/Yield)) shall be treated as payments of interest and principal, respectively, for Federal and state income tax and bankruptcy purposes. The Lessor shall be deemed to have a valid and binding security interest in and Lien on the Properties, free and clear of all Liens other than Permitted Property Liens, as security for the obligations of the Lessees under the Operative Documents, (it being understood and agreed that the Lessees do hereby grant a Lien, and convey, transfer, assign, mortgage ▇▇▇ ▇▇▇▇▇▇▇ to Lessor and its successors, transferees and assigns, for the benefit of the Lessor and its successors, transferees and assigns, the Properties and any proceeds or products thereof, to have and hold the same as collateral security for the payment and performance of the obligations of the Lessees under the Operative Documents). Each of the parties hereto agrees that it will not, nor will it permit any Affiliate to at any time, take any action or fail to take any action with respect to the preparation or filing of any income tax return, including an amended income tax return, to the extent that such action or such failure to take action would be inconsistent with the intention of the parties expressed in this Section 5.1. 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 a Lessee, the Company, Lessor, any Participant or any collection actions, the transactions evidenced by the Operative Documents shall be regarded as loans made by the Participants to the Lessees.
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Nature of the Transaction. It is the intent intention of the parties that: :
(a) the Lease Transaction constitutes an operating lease from the Lessor to the Lessees Lessee for purposes of the Lessees' Lessee’s financial reporting, including, without limitation, under Financial Accounting Standards Board Statement No. 13;
(b) for purposes of federal and all state and local income and transfer taxes and bankruptcy, insolvency, conservatorships and receiverships (including the Lease substantive law upon which bankruptcy insolvency, conservatorships and other transactions contemplated hereby preserve receiverships proceedings are based) purposes:
(i) the Transaction constitutes a financing by Lessor and the Lenders to Lessee and preserves beneficial ownership in the Properties Leased Property in Lessee, Lessee will be entitled to all tax benefits ordinarily available to owners of property similar to the Lessees Leased Property for Federal tax purposes and state income tax and bankruptcy purposes, (c) each Lease Supplement grants to Lessor a Lien on the Property covered thereby, and (d) the obligations of the Lessees Lessee to pay Basic Rent (Interest/Yield) and any part of any Property Balance (other than Basic Rent (Interest/Yield)) shall be treated as payments of interest to Lessor and principalthe Lenders, respectively, for Federal and state income tax and bankruptcy purposes. The Lessor the payment by Lessee of any amounts in respect of the Lease Balance shall be treated as payments of principal to Lessor and the Lenders;
(ii) to the extent the Transaction is deemed to have a valid and binding financing, this Memorandum of Lease provides for a security interest in and Lien on the Properties, free and clear of all Liens other than Permitted Property Liens, as security for the obligations of the Lessees under the Operative Documents, (it being understood and agreed that the Lessees do hereby grant or a Lien, as the case may be, in Lessee’s interest in the Mortgaged Property, including without limitation other Lessee Collateral, in favor of Lessor, and convey, transfer, assign, mortgage ▇▇▇ ▇▇▇▇▇▇▇ to Lessor and its successors, transferees and assigns, for the benefit of the Lessor Administrative Agent and its successors, transferees and assigns, the Properties and any proceeds or products thereofLenders, to have and hold the same as collateral security for the secure Lessee’s payment and performance of the obligations Obligations;
(iii) the Lease creates a Lien on and security interest in Lessee Collateral in favor of the Lessees Administrative Agent for the benefit of Lessor and the Lenders to secure Lessor’s payment and performance of its obligations under the Operative Documents). Each ; and
(iv) the Lease is intended as a deed of trust on the Leased Property, notwithstanding the remedies in Section 13.1 of the parties hereto Lease that are more customarily available to lessors of real property. Nevertheless, Lessee acknowledges and agrees that it will notnone of Lessor, nor will it permit the Administrative Agent or Lender has made any Affiliate to at any timerepresentations or warranties concerning the tax, take any action accounting or fail to take any action with respect to the preparation or filing of any income tax return, including an amended income tax return, to the extent that such action or such failure to take action would be inconsistent with the intention legal characteristics of the parties expressed in this Section 5.1. Operative Documents or any aspect of the Transaction and that Lessee has obtained and relied upon such tax, accounting and legal advice concerning the Operative Documents and the Transaction as it deems appropriate.
(c) Specifically, without limiting the generality of the foregoingclause (a) above, the parties hereto intend and agree that in the event of any insolvency insolvency, conservatorship or receivership proceedings or matters or a petition under the United States bankruptcy laws laws, or any other applicable insolvency insolvency, conservatorship or receivership laws or statute of the United States of America or any State or Commonwealth thereof affecting a Lessee, the Company, Lessor, any Participant Lessee or Guarantor or any collection actions, the transactions evidenced by the Operative Documents (including, without limitation, the Lease) constitute loans made directly to Lessee by Lessor and the Lenders, in each case as unrelated third party lenders, and that Lessor holds title to, and Lessor holds a lien on, the Leased Property for the benefit of the Lessor and the Lenders to secure Lessee’s obligations to repay such loans to Lender and all other amounts due under any of the Operative Documents.
(d) Specifically, but without limiting the generality of subsection (a) above, Lessor and Lessee intend and agree that, for the purpose of securing Lessee’s obligations for the repayment of the Obligations, (i) the Lease shall also be deemed to be a security agreement and financing statement within the meaning of Article 9 of the UCC; (ii) the conveyance provided for hereby shall be regarded deemed to be a grant by Lessee to Lessor, of a security interest in and to the Deed of Trust Trustee of a mortgage and deed of trust lien on all of Lessee’s present and future title and interest in and to the Leased Property and the other Lessee Collateral, and all proceeds of the conversion, voluntary or involuntary, of the foregoing into cash, investments, securities or other property, whether in the form of cash, investments, securities or other property to secure such loans, effective on the date hereof, to have and to hold such interests in the Leased Property and the other Lessee Collateral unto Lessor, (iii) to the extent permitted by Applicable Laws, the possession by Lessor of notes and such other items of property as loans made constitute instruments, money, negotiable documents or tangible chattel paper shall be deemed to be “possession” or “control” by the Participants “secured party” for purposes of perfecting the security interest pursuant to the LesseesUCC; and (iv) to the extent permitted by Applicable Law, notifications to Persons holding such property, and acknowledgments, receipts or confirmations from financial intermediaries, bankers or agents (as applicable) of Lessee shall be deemed to have been given for the purpose of perfecting such security interest under Applicable Law. Lessor and Lessee shall, to the extent consistent with the Lease, take such actions and execute, deliver, file and record such other documents, financing statements, mortgages and deeds of trust as may be necessary to ensure that this Memorandum of Lease creates a mortgage lien and a security interest in the Mortgaged Property and the other Lessee Collateral in accordance with this Section 16 and, such mortgage lien and security interest is a perfected security interest in the Mortgaged Property and the other Lessee Collateral with priority over all Liens, other than Permitted Liens, under Applicable Law and will be maintained as such throughout the Term.
(e) If (contrary to the intent of the parties as expressed above and in Section 2.4 of the Participation Agreement) it is determined that Lessee is not, under applicable state law as applied to the Operative Documents, the equitable owner of the Leased Property and the borrower from Lessor in a financing arrangement, but rather is a tenant under the Lease with an option to purchase from Lessor as provided in Sections 14.1 or 17.22 of the Lease (as the case may be, the “Payoff Option”), then the parties intend that the Payoff Option be secured by a lien and security interest against the Leased Property. Accordingly, Lessor does hereby grant to lessee a lien and security interest against the Leased Property, including all rights, title and interests of Lessor from time to time in and to the Land and Improvements, for the sole purpose of securing (1) Lessor’s obligation to convey the Leased Property to lessee if Lessee exercises the Payoff Option and tenders payment of the Purchase Amount to Lessor as provided herein, and (2) Lessee’s right to recover any damages from Lessor caused by a breach of such obligation, including any such breach caused by a rejection or termination of the Payoff Option in any bankruptcy or insolvency proceeding instituted by or against Lessor, as debtor. Lessee may enforce such lien and security interest judicially after any such breach by Lessor, but not otherwise. The foregoing grant shall terminate without further action upon the termination or expiration of the Payoff Option.
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Nature of the Transaction. It is the intent intention of the parties that: :
(a) the Lease Transaction constitutes an operating lease from the Lessor to the Lessees Lessee for purposes of the Lessees' Lessee’s financial reporting, including, without limitation, under Financial Accounting Standards Codification 840;
(b) for purposes of federal and all state and local income and transfer taxes and bankruptcy, insolvency, conservatorships and receiverships (including the Lease substantive law upon which bankruptcy insolvency, conservatorships and other transactions contemplated hereby preserve receiverships proceedings are based) purposes:
(i) the Transaction constitutes a financing by Lessor to Lessee and preserves beneficial ownership in the Properties Leased Property in Lessee, Lessee will be entitled to all tax benefits ordinarily available to owners of property similar to the Lessees Leased Property for Federal tax purposes and state income tax and bankruptcy purposes, (c) each Lease Supplement grants to Lessor a Lien on the Property covered thereby, and (d) the obligations of the Lessees Lessee to pay Basic Rent (Interest/Yield) and any part of any Property Balance (other than Basic Rent (Interest/Yield)) shall be treated as payments of interest to Lessor, and principal, respectively, for Federal and state income tax and bankruptcy purposes. The Lessor the payment by Lessee of any amounts in respect of the Lease Balance shall be treated as payments of principal to Lessor;
(ii) to the extent the Transaction is deemed to have a valid and binding financing, this Memorandum of Lease provides for a security interest in and Lien on the Properties, free and clear of all Liens other than Permitted Property Liens, as security for the obligations of the Lessees under the Operative Documents, (it being understood and agreed that the Lessees do hereby grant or a Lien, and conveyas the case may be, transferin Lessee’s interest in the Mortgaged Property, assignincluding without limitation other Lessee Collateral, mortgage ▇▇▇ ▇▇▇▇▇▇▇ in favor of Lessor to Lessor and its successors, transferees and assigns, for the benefit of the Lessor and its successors, transferees and assigns, the Properties and any proceeds or products thereof, to have and hold the same as collateral security for the secure Lessee’s payment and performance of the obligations Obligations;
(iii) the Lease creates a Lien on and security interest in Lessee Collateral in favor of Lessor; and
(iv) the Lease is intended as a deed of trust on the Leased Property, notwithstanding the remedies in Section 13.1 of the Lessees under Lease that are more customarily available to lessors of real property. Nevertheless, Lessee acknowledges and agrees that Lessor has not made any representations or warranties concerning the tax, accounting or legal characteristics of the Operative Documents). Each Documents or any aspect of the parties hereto agrees Transaction and that Lessee has obtained and relied upon such tax, accounting and legal advice concerning the Operative Documents and the Transaction as it will not, nor will it permit any Affiliate to at any time, take any action or fail to take any action with respect to the preparation or filing of any income tax return, including an amended income tax return, to the extent that such action or such failure to take action would be inconsistent with the intention of the parties expressed in this Section 5.1. deems appropriate.
(c) Specifically, without limiting the generality of the foregoingclause (a) above, the parties hereto intend and agree that in the event of any insolvency insolvency, conservatorship or receivership proceedings or matters or a petition under the United States bankruptcy laws laws, or any other applicable insolvency insolvency, conservatorship or receivership laws or statute of the United States of America or any State or Commonwealth thereof affecting a Lessee, the Company, Lessor, any Participant Lessee or any collection actions, the transactions evidenced by the Operative Documents (including, without limitation, the Lease) constitute loans made directly to Lessee by Lessor as an unrelated third party lender, and that Lessor holds title to, and Lessor holds a lien on, the Leased Property for the benefit of the Lessor to secure Lessee’s obligations to repay such loans to Lessor and all other amounts due under any of the Operative Documents.
(d) Specifically, but without limiting the generality of subsection (a) above, Lessor and Lessee intend and agree that, for the purpose of securing Lessee’s obligations for the repayment of the Obligations, (i) the Lease shall also be deemed to be a security agreement and financing statement within the meaning of Article 9 of the UCC; (ii) the conveyance provided for hereby shall be regarded deemed to be a grant by Lessee to Lessor, of a security interest in and to the Deed of Trust Trustee of a mortgage and deed of trust lien on all of Lessee’s present and future title and interest in and to the Leased Property and the other Lessee Collateral, and all proceeds of the conversion, voluntary or involuntary, of the foregoing into cash, investments, securities or other property, whether in the form of cash, investments, securities or other property to secure such loans, effective on the date hereof, to have and to hold such interests in the Leased Property and the other Lessee Collateral unto Lessor, (iii) to the extent permitted by Applicable Laws, the possession by Lessor of notes and such other items of property as loans made constitute instruments, money, negotiable documents or tangible chattel paper shall be deemed to be “possession” or “control” by the Participants “secured party” for purposes of perfecting the security interest pursuant to the LesseesUCC; and (iv) to the extent permitted by Applicable Law, notifications to Persons holding such property, and acknowledgments, receipts or confirmations from financial intermediaries, bankers or agents (as applicable) of Lessee shall be deemed to have been given for the purpose of perfecting such security interest under Applicable Law. Lessor and Lessee shall, to the extent consistent with the Lease, take such actions and execute, deliver, file and record such other documents, financing statements, mortgages and deeds of trust as may be necessary to ensure that this Memorandum of Lease creates a mortgage lien and a security interest in the Mortgaged Property and the other Lessee Collateral in accordance with this Section 15 and, such mortgage lien and security interest is a perfected security interest in the Mortgaged Property and the other Lessee Collateral with priority over all Liens, other than Permitted Liens, under Applicable Law and will be maintained as such throughout the Term.
(e) If (contrary to the intent of the parties as expressed above and in Section 2.4 of the Participation Agreement) it is determined that Lessee is not, under applicable state law as applied to the Operative Documents, the equitable owner of the Leased Property and the borrower from Lessor in a financing arrangement, but rather is a tenant under the Lease with an option to purchase from Lessor as provided in Sections 14.1 or 17.22 of the Lease (as the case may be, the “Payoff Option”), then the parties intend that the Payoff Option be secured by a lien and security interest against the Leased Property. Accordingly, Lessor does hereby grant to Lessee a lien and security interest against the Leased Property, including all rights, title and interests of Lessor from time to time in and to the Land and Improvements, for the sole purpose of securing (1) Lessor’s obligation to convey the Leased Property to Lessee if Lessee exercises the Payoff Option and tenders payment of the Purchase Amount to Lessor as provided herein, and (2) Lessee’s right to recover any damages from Lessor caused by a breach of such obligation, including any such breach caused by a rejection or termination of the Payoff Option in any bankruptcy or insolvency proceeding instituted by or against Lessor, as debtor. Lessee may enforce such lien and security interest judicially after any such breach by Lessor, but not otherwise. The foregoing grant shall terminate without further action upon the termination or expiration of the Payoff Option.
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