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EXHIBIT 10.26
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PARTICIPATION AGREEMENT
(Capital One Services, Inc.)
Dated as of September 3, 1999
among
CAPITAL ONE SERVICES, INC.,
as Construction Agent and as Lessee,
CAPITAL ONE FINANCIAL CORPORATION,
as Guarantor,
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually, except as expressly
stated herein, but solely as Owner Trustee
under the Capital One Realty Trust 1998-1
THE VARIOUS BANKS AND OTHER
LENDING INSTITUTIONS WHICH ARE PARTIES HERETO
FROM TIME TO TIME,
as the Holders,
THE VARIOUS BANKS AND OTHER
LENDING INSTITUTIONS WHICH ARE PARTIES HERETO
FROM TIME TO TIME,
as the Lenders
and
BANK OF AMERICA, N.A.,
as Agent for the
Lenders and respecting
the Security Documents, as Agent for
the Lenders and the Holders,
to the extent of their interests
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TABLE OF CONTENTS
Page
SECTION 1 THE LOANS............................................................................................ 1
SECTION 2 HOLDER FUNDINGS...................................................................................... 2
SECTION 3 SUMMARY OF TRANSACTIONS.............................................................................. 2
3.1 Operative Agreements................................................................................. 2
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3.2 Property Purchase.................................................................................... 2
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3.3 Construction of Improvements; Lease or Disposition of Property....................................... 3
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3.4 Ratable Interests of the Holders and the Lenders in the Commitments and Holder Commitments under the
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▇▇▇▇ Participation Agreement......................................................................... 3
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SECTION 4 THE CLOSINGS......................................................................................... 3
4.1 Initial Closing Date................................................................................. 3
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4.2 Initial Closing Date; Property Closing Dates; Construction Advances.................................. 3
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SECTION 5 FUNDING OF ADVANCES; REPORTING REQUIREMENTS ON COMPLETION DATE; LESSEE DELIVERY OF NOTICES; CERTAIN
COVENANTS........................................................................................................ 4
5.1 General............................................................................................. 4
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5.2 Procedures for Funding.............................................................................. 5
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5.3 Conditions to the Holders' and the Lenders' Obligations to Advance Funds for the Acquisition of
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Property......................................................................................... 6
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5.4 Conditions to the Holders' and the Lenders' Obligations to Make Construction Advances for the
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Ongoing Construction on any Property Prior to the Construction Period Termination Date........... 9
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5.5 Additional Reporting and Delivery Requirements on Completion Date Respecting Each Property.......... 10
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5.6 Construction Agent Delivery of Construction Budget Modifications.................................... 10
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5.7 Maintenance of the Lessee as a Wholly-Owned Entity.................................................. 11
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5.8 Unilateral Right to Increase the Holder Commitments and the Lender Commitments...................... 11
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5.9 Borrower's Right to Increase the Commitments Under the ▇▇▇▇ Credit Agreement and the Holder
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Commitments Allocable to the ▇▇▇▇ Trust Estate................................................... 11
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5.10 Additional Holder Representatives; Lessee's Right to Replace Holder................................ 11
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SECTION 6 CONDITIONS OF THE INITIAL CLOSING.................................................................. 12
6.1 Conditions to the Lessor's and the Holders' Obligations............................................ 12
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6.2 Conditions to the Lessee's Obligations............................................................. 14
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6.3 Conditions to the Agent's Obligations.............................................................. 15
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SECTION 7 REPRESENTATIONS AND WARRANTIES ON THE INITIAL CLOSING DATE......................................... 15
7.1 Representations and Warranties of the Holders...................................................... 15
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7.2 Representations and Warranties of the Borrower..................................................... 17
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7.3 Representations and Warranties of the Construction Agent and the Credit Parties..................... 20
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7.4 Representations and Warranties of the Agent......................................................... 22
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SECTION 8 REPRESENTATIONS AND WARRANTIES ON FUNDING DATES..................................................... 23
8.1 Representations and Warranties on Property Closing Dates............................................ 23
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8.2 Representations and Warranties Upon Initial Construction Advances................................... 24
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8.3 Representations and Warranties Upon the Date of Each Construction Advance That Is Not An Initial
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Advance........................................................................................ 26
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SECTION 8B. GUARANTY............................................................................................ 27
8B.1. Guaranty of Payment and Performance................................................................. 27
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8B.2. Obligations Unconditional........................................................................... 28
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8B.3. Modifications....................................................................................... 29
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8B.4. Waiver of Rights.................................................................................... 29
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8B.5. Reinstatement....................................................................................... 30
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8B.6. Remedies............................................................................................ 30
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8B.7. Limitation of Guaranty.............................................................................. 30
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8B.8. Payment of Amounts to the Agent..................................................................... 30
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8B.9. Denial or Disaffirmance of Guaranty................................................................. 31
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SECTION 9 PAYMENT OF CERTAIN EXPENSES......................................................................... 31
9.1 Transaction Expenses................................................................................ 31
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9.2 [Reserved].......................................................................................... 32
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9.3 Certain Fees and Expenses........................................................................... 32
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9.4 Facility Fee........................................................................................ 33
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SECTION 10 OTHER COVENANTS AND AGREEMENTS...................................................................... 33
10.1 Cooperation with the Construction Agent or the Lessee............................................... 33
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10.2 Covenants of the Owner Trustee and the Holders...................................................... 33
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10.3 Credit Party Covenants, Consent and Acknowledgment.................................................. 35
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10.4 Sharing of Certain Payments......................................................................... 36
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10.5 Grant of Easements, etc............................................................................. 37
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10.6 Appointment by Holders and Owner Trustee............................................................ 37
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SECTION 11 CREDIT AGREEMENT AND TRUST AGREEMENT................................................................ 38
11.1 Construction Agent's and Lessee's Credit Agreement Rights........................................... 38
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11.2 Construction Agent's and Lessee's Trust Agreement Rights............................................ 39
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SECTION 12 TRANSFER OF INTEREST................................................................................ 39
12.1 Restrictions on Transfer............................................................................ 39
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12.2 Effect of Transfer.................................................................................. 40
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SECTION 13 INDEMNIFICATION..................................................................................... 40
13.1 General Indemnity................................................................................... 40
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13.2 General Tax Indemnity............................................................................... 43
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13.3. EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE, STRICT LIABILITY, ETC.............................. 47
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13.4. Additional Provisions Regarding Environmental Indemnification....................................... 48
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13.5. Additional Provisions Regarding Indemnification..................................................... 48
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13.6. Indemnifications Provided by the Owner Trustee in Favor of the Other Indemnified Persons............ 48
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SECTION 14 MISCELLANEOUS....................................................................................... 49
14.1 Survival of Agreements.............................................................................. 49
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14.2 No Broker, etc...................................................................................... 50
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14.3 Notices............................................................................................. 50
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14.4 Counterparts........................................................................................ 51
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14.5 Amendments and Termination.......................................................................... 52
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14.6 Headings, etc....................................................................................... 52
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14.7 Parties in Interest................................................................................. 52
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14.8 GOVERNING LAW; WAIVERS OF JURY TRIAL................................................................ 52
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14.9 Severability........................................................................................ 52
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14.10 Liability Limited................................................................................... 52
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14.11 Rights of the Credit Parties........................................................................ 54
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14.12 Further Assurances.................................................................................. 54
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14.13 Calculations under Operative Agreements............................................................. 54
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14.14 Confidentiality..................................................................................... 55
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EXHIBITS
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A - Forms of Requisition - Sections 4.2 and 5.2
B - Officer's Certificate - Section 5.6
C - Legal Opinion of Lessee's Counsel - Section 6.1(c)
D - Officer's Certificate - Section 6.1(g)
E - Officer's Certificate - Section 6.1(h)
F - Officer's Certificate - Section 6.2(d)
G - Officer's Certificate - Section 6.2(e)
H - Legal Opinion - Section 6.2(f)
I - Description of Material Litigation
J - Confidentiality Agreement
Appendix A Rules of Usage and Definitions
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PARTICIPATION AGREEMENT
(Capital One Services, Inc.)
THIS PARTICIPATION AGREEMENT (Capital One Services, Inc.), dated as of
September 3, 1999 (as amended or supplemented from time to time, this
"Agreement") is by and among CAPITAL ONE SERVICES, INC., a Delaware corporation
("Lessee" or the "Construction Agent"); CAPITAL ONE FINANCIAL CORPORATION, a
Delaware corporation, as guarantor ("Guarantor"); FIRST SECURITY BANK, NATIONAL
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ASSOCIATION, a national banking association, not individually (in its individual
capacity, the "Trust Company"), except as expressly stated herein, but solely as
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Owner Trustee under the Capital One Realty Trust 1998-1 (the "Owner Trustee",
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the "Borrower" or the "Lessor"); the various banks and other lending
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institutions which are parties hereto from time to time as holders of
certificates issued with respect to the Capital One Realty Trust 1998-1 (subject
to the definition of Holders in Appendix A hereto, individually, a "Holder" and
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collectively, the "Holders"); the various banks and other lending institutions
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which are parties hereto from time to time as lenders (subject to the definition
of Lenders in Appendix A hereto, individually, a "Lender" and collectively, the
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"Lenders"); and BANK OF AMERICA, N.A., a national banking association, as the
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agent for the Lenders and respecting the Security Documents, as the agent for
the Lenders and the Holders, to the extent of their interests (in such capacity,
the "Agent"). Capitalized terms used but not otherwise defined in this
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Agreement shall have the meanings set forth in Appendix A hereto.
This Agreement relates to the Lease, the COSI Trust Estate and the
Advances, Commitments and Holder Commitments related thereto.
In consideration of the mutual agreements herein contained and other good
and valuable consideration, receipt of which is hereby acknowledged, the parties
hereto hereby agree as follows:
SECTION 1 THE LOANS.
The Lenders have agreed to make loans to the Lessor from time to time in an
aggregate principal amount of up to the aggregate amount of the Commitments of
the Lenders in order for the Lessor to acquire the Properties and certain
Improvements and to develop and construct certain Improvements in accordance
with the Agency Agreement and the terms and provisions hereof, and in
consideration of the receipt of proceeds of the Loans, the Lessor will issue the
Notes. The Loans shall be made and the Notes shall be issued pursuant to the
Credit Agreement. Pursuant to Section 5 of this Agreement and Section 2 of the
Credit Agreement, the Loans will be made to the Lessor from time to time at the
request of the Construction Agent in consideration for the Construction Agent
agreeing for the benefit of the Lessor, pursuant to the Agency Agreement, to
acquire the Properties, to acquire the Equipment, to construct certain
Improvements and to cause the Lessee to lease the Properties, each in accordance
with the Agency Agreement and the other Operative Agreements. The Loans and the
obligations of the Lessor under the Credit Agreement shall be secured by the
Collateral.
SECTION 2 HOLDER FUNDINGS.
Subject to the terms and conditions of this Agreement and in reliance on
the representations and warranties of each of the parties hereto contained
herein or made pursuant hereto on each date Advances made in accordance with
Section 5 hereof, each Holder shall make a Holder Funding on a pro rata basis to
the Lessor with respect to the Capital One Realty Trust 1998-1 based on its
Holder Commitment in an amount in immediately available funds such that the
aggregate of all Holder Fundings shall be three percent (3%) of the amount of
the Advance being funded on such date; provided, no Holder shall be obligated
for any Holder Funding in excess of its pro rata share of the Available Holder
Commitment; provided, further, that the initial Advance hereunder shall consist
of Holder Fundings in an amount equal to $861,617 and Loans in an amount equal
to $19,525,613. The aggregate amount of Holder Fundings shall be up to the
aggregate amount of the Holder Commitments. No prepayment or any other payment
shall be permitted such that the aggregate outstanding Holder Fundings on the
date of such payment or prepayment are less than 3% of the aggregate outstanding
amount of Advances made as of such date, except as provided in Section 8 of the
Credit Agreement. The representations, warranties, covenants and agreements of
the Holders herein and in the other Operative Agreements are several, and not
joint or joint and several.
SECTION 3 SUMMARY OF TRANSACTIONS.
3.1 OPERATIVE AGREEMENTS.
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On the date hereof, each of the respective parties hereto and thereto shall
execute and deliver this Agreement, the Lease, the Agency Agreement, the Credit
Agreement, the Trust Agreement, the Security Agreement and such other documents,
instruments, certificates and opinions of counsel as agreed to by the parties
hereto.
3.2 PROPERTY PURCHASE.
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On each Property Closing Date and subject to the terms and conditions of
this Agreement (a) the Holders will each make a Holder Funding in accordance
with Sections 2 and 5 of this Agreement and the terms and provisions of the
Trust Agreement, (b) the Lenders will each make Loans in accordance with
Sections 1 and 5 of this Agreement and the terms and provisions of the Credit
Agreement, (c) the Lessor will purchase, or lease pursuant to a Ground Lease,
the applicable Property, each to be within an Approved State, identified by the
Construction Agent, in each case pursuant to a Deed and/or ▇▇▇▇ of Sale or a
Ground Lease, as the case may be, and grant the Agent a lien on such Property by
execution of the required Security Documents, and (d) if the Property Closing
Date for such Property is also the Basic Term Commencement Date for such
Property, the Agent, the Lessee and the Lessor shall execute and deliver a Lease
Supplement relating to such Property.
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3.3 CONSTRUCTION OF IMPROVEMENTS; LEASE OR DISPOSITION OF PROPERTY.
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Construction Advances will be made with respect to particular Improvements
to be constructed and with respect to ongoing construction of particular
Improvements, in each case, pursuant to the terms and conditions of this
Agreement and the Agency Agreement. The Construction Agent will act as a
construction agent on behalf of the Lessor respecting the construction of such
Improvements and the expenditures of the Construction Advances related thereto.
The Construction Agent shall promptly notify the Lessor upon Completion of the
Improvements and the Lessee shall commence to pay Basic Rent as of the Basic
Term Commencement Date.
3.4 RATABLE INTERESTS OF THE HOLDERS AND THE LENDERS IN THE COMMITMENTS
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AND HOLDER COMMITMENTS UNDER THE ▇▇▇▇ PARTICIPATION AGREEMENT.
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Each Holder and Lender agrees at all times (a) (i) that each Tranche A
Lender shall hold the same ratable portion of the aggregate Lender Commitment
for Tranche A Loans as such Tranche A Lender holds with respect to the aggregate
Lender Commitment for Tranche A Loans as defined in the ▇▇▇▇ Participation
Agreement, (ii) that each Tranche B Lender shall hold the same ratable portion
of the aggregate Lender Commitment for Tranche B Loans as such Tranche B Lender
holds with respect to the aggregate Lender Commitment for Tranche B Loans as
defined in the ▇▇▇▇ Participation Agreement, and (iii) that each Holder shall
hold the same ratable portion of the aggregate Holder Commitment as such Holder
holds with respect to the aggregate Holder Commitment as defined in the ▇▇▇▇
Participation Agreement, and (b) to make advances consistent with such committed
amounts referenced in Section 3.4(a) in accordance with the requirements of the
Operative Agreements, as defined in Appendix A hereto, and in accordance with
the requirements of the Operative Agreements, as defined in Appendix A to the
▇▇▇▇ Participation Agreement.
SECTION 4 THE CLOSINGS.
4.1 INITIAL CLOSING DATE.
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All documents and instruments required to be delivered on the Initial
Closing Date shall be delivered at the offices of ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC,
Charlotte, North Carolina, or at such other location as may be determined by the
Lessor, the Agent and the Lessee.
4.2 INITIAL CLOSING DATE; PROPERTY CLOSING DATES; CONSTRUCTION ADVANCES.
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The Construction Agent shall deliver to the Lessor and the Agent a
requisition (a "Requisition"), in the form attached hereto as Exhibit A or in
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such other form as is reasonably satisfactory to the Lessor and the Agent, in
connection with (a) the Initial Closing Date relating to the amounts specified
in the second proviso to the first sentence of Section 2 hereof, the Transaction
Expenses and other fees, expenses and disbursements payable by the Lessor
pursuant to Section 9.1(a); and (b) each Property Closing Date relating to each
Acquisition Advance pursuant to
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Sections 5.3 and 9.1(b); and (c) each date of a Construction Advance pursuant to
Sections 5.4 and 9.1(b). Notwithstanding the foregoing, the Lenders and the
Holders may, in their sole discretion, make Advances pursuant to or in
connection with Article IX and Section 13.6 without a Requisition; provided,
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however, the failure of such amounts so funded to be referenced in a Requisition
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shall not preclude the Lessee from later contesting the reasonableness of the
payment of such amounts, and any amounts required to be refunded by the Lessor
or any third party following a successful contest shall be available for future
Advances to be made in accordance with the provisions of the Operative
Agreements.
SECTION 5 FUNDING OF ADVANCES; REPORTING REQUIREMENTS ON COMPLETION DATE;
LESSEE DELIVERY OF NOTICES; CERTAIN COVENANTS.
5.1 GENERAL.
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(a) To the extent funds have been made available to the Lessor as
Loans by the Lenders and Holder Fundings by the Holders, the Lessor will
use such funds from time to time in accordance with the terms and
conditions of this Agreement and the other Operative Agreements (i) to pay
interest regarding the Loans relating to a Property and to pay the Holder
Yield regarding the Holder Fundings relating to a Property, in each case to
the extent accrued under the Credit Agreement or Trust Agreement (as the
case may be) during the period prior to the Basic Term Commencement Date
with respect to such Property, (ii) at the direction of the Construction
Agent to acquire the Properties in accordance with the terms of this
Agreement, the Agency Agreement and the other Operative Agreements, (iii)
to make Advances to the Construction Agent to permit the development,
construction, modification, design, and renovation, as applicable, of
Improvements in accordance with the terms of the Agency Agreement, and the
other Operative Agreements, and (iv) to pay Transaction Expenses and
disbursements payable by the Lessor under Article IX and Section 13.6.
(b) In lieu of the payment of interest on the Loans and Holder Yield
on the Holder Fundings on any Scheduled Interest Payment Date with respect
to any Property during the period prior to the Basic Term Commencement Date
with respect to such Property and subject to Section 5.8, (i) each Lender's
Loan shall automatically be increased by the amount of interest accrued and
unpaid on such Loan for such period (except to the extent that at any time
such increase would cause such Lender's Loan to exceed such Lender's
Available Commitment, in which case the Lessee shall pay such excess amount
to such Lender in immediately available funds on the Basic Term
Commencement Date, plus interest thereon at the Overdue Rate, and (ii) each
Holder's Holder Funding shall automatically be increased by the amount of
Holder Yield accrued and unpaid on such Holder Funding for such period
(except to the extent that at any time such increase would cause the Holder
Funding of such Holder to exceed such Holder's Available Holder Commitment,
in which case the Lessee shall pay such excess amount to such Holder in
immediately available funds on the Basic Term Commencement Date, plus
interest thereon at the Overdue Rate). Such increases in a Lender's Loan
and a Holder's Holder Funding shall occur without any disbursement of funds
by any Person.
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5.2 PROCEDURES FOR FUNDING.
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(a) The Construction Agent shall designate the date for Advances
hereunder in accordance with the terms and provisions hereof; provided,
however, it is understood and agreed that no more than two Advances may be
requested during any calendar month and the Lenders and the Holders may, in
their sole discretion, fund Transaction Expenses, fees, expenses and other
disbursements payable by the Lessor pursuant to or in connection with
Article IX and Section 13.6 regardless whether the Construction Agent
provides such designation with respect thereto; and provided, further, not
more than one of such Advances may be a Eurodollar Loan. Not less than (i)
three (3) Business Days' prior to the Initial Closing Date and (ii) three
(3) Business Days prior to the date on which any Construction or
Acquisition Advance is to be made, the Construction Agent shall deliver to
the Agent, (A) with respect to the Initial Closing Date and each
Acquisition Advance, a Requisition as described in Section 4.2 hereof and
(B) with respect to each Construction Advance, a Requisition identifying
(among other things) the Property to which such Construction Advance
relates.
(b) Each Requisition shall: (i) be irrevocable, (ii) request funds in
an amount that is not in excess of the total aggregate of the Available
Commitments plus the Available Holder Commitments at such time, and (iii)
request that the Holders make a Holder Funding and that the Lenders make
Loans to the Lessor for the payment of the Property Acquisition Costs (in
the case of an Acquisition Advance) or other Property Costs (in the case of
a Construction Advance) that have previously been incurred and were not
subject to a prior Requisition, in each case as specified in the
Requisition.
(c) Subject to the satisfaction of the conditions precedent set forth
in Sections 5.3, 5.4 or 5.5, as applicable, on each Property Closing Date
or the date on which the Construction Advance is to be made, as applicable,
and further subject to the second proviso to the first sentence of Section
2 hereof respecting the initial Advance to be made hereunder, (i) the
Lenders shall make Loans to the Lessor in an aggregate amount equal to 97%
times the sum of (w) the Requested Funds specified in any Requisition and
(x) any additional amount of Transaction Expenses or other costs as
referenced in Article IX and any additional amount respecting any indemnity
payment as referenced in Section 13.6 (unless any such funding of
Transaction Expenses or any indemnity payment is declined in writing by
each Lender and each Holder (such decision to be in the sole discretion of
each Lender and each Holder)), ratably between the Tranche A Lenders and
the Tranche B Lenders with the Tranche A Lenders funding eighty-six percent
(86%) of the Requested Funds and the Tranche B Lenders funding eleven
percent (11%) of the Requested Funds), up to an aggregate principal amount
equal to the Available Commitments, (ii) each Holder shall make a pro rata
Holder Funding based on its Holder Commitment in an amount such that the
aggregate of all Holder Fundings at such time shall be 3% times the sum of
(y) the Requested Funds specified in such Requisition and (z) any
additional amount of Transaction Expenses or other costs as referenced in
Article IX and any additional amount respecting any indemnity payment as
referenced in Section 13.6 (unless any such funding of Transaction Expenses
or any indemnity payment is declined
5
in writing by each Lender and each Holder (such decision to be in the sole
discretion of each Lender and each Holder)), up to the aggregate advanced
amount equal to the aggregate of the Available Holder Commitments and
provided no such Holder Funding shall exceed such Holder's pro rata share
of the Available Holder Commitments; and (iii) the total amount of such
Loans and Holder Fundings made on such date shall (a) be used by the Lessor
to pay Property Acquisition Costs including Transaction Expenses and other
costs and indemnity payments within three (3) Business Days of the receipt
by the Lessor of such Advance (it being understood and agreed that the
first Advance shall include an amount necessary to cover costs incurred
prior to the Initial Closing Date in connection with the Land and
Improvements owned or ground leased by the Borrower and located in
Hillsborough County, Florida) or (b) be advanced by the Lessor on the date
of such Advance to the Construction Agent or the Lessee to pay Property
Costs, as applicable.
(d) With respect to an Advance obtained by the Lessor to pay for
Property Acquisition Costs and/or Transaction Expenses or other costs
payable under Article IX or Section 13.6 hereof and not expended by Lessor
for such purpose on the date of such Advance, such amounts shall be held by
the Lessor (or the Agent on behalf of the Lessor) until the applicable
Property Closing Date or, if such Property Closing Date does not occur
within three (3) Business Days of the date of the Lessor's receipt of such
Advance, shall be applied to repay the applicable Advance to the Lenders
and the Holders and, subject to the terms hereof, and of the Credit
Agreement and the Trust Agreement, shall remain available for future
Advances. Any such amounts held by the Lessor (or the Agent on behalf of
the Lessor) shall be subject to the lien of the Security Agreement.
5.3 CONDITIONS TO THE HOLDERS' AND THE LENDERS' OBLIGATIONS TO ADVANCE
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FUNDS FOR THE ACQUISITION OF PROPERTY.
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The obligations of the Holders to make a Holder Funding, and of the Lenders
to make Loans to the Lessor, (i) on the Initial Closing Date to pay Transaction
Expenses, fees, expenses and other disbursements payable by the Lessor under
Article IX of this Agreement and (ii) on a Property Closing Date for the purpose
of providing funds to the Lessor necessary to pay the Transaction Expenses,
fees, expenses and other disbursements payable by the Lessor under Article IX of
this Agreement and to acquire a Property (an "Acquisition Advance") in each case
are subject to the satisfaction or waiver of the following conditions precedent:
(a) the correctness in all material respects on such Property Closing
Date of the representations and warranties (including without limitation
the Incorporated Representations and Warranties) of the Lessor, the
Construction Agent, the Lessee and the Holders contained herein and in each
of the other Operative Agreements;
(b) the performance in all material respects by the Construction
Agent and the Lessee of their respective agreements contained herein and in
the other Operative Agreements and to be performed by them on or prior to
each Property Closing Date;
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(c) the Agent shall have received a fully executed counterpart copy
of the Requisition, appropriately completed;
(d) title to each Property being acquired on such Property Closing
Date shall conform to the representations and warranties set forth in
Section 8.1(c) hereof;
(e) the Construction Agent shall have delivered to the Lessor a copy
of the Deed with respect to the Land and existing Improvements and a copy
of the ▇▇▇▇ of Sale with respect to the Equipment, respecting such of the
foregoing as are being acquired on such Property Closing Date, and such
Land and existing Improvements shall be located in an Approved State;
(f) there shall not have occurred and be continuing any Default or
Event of Default under any of the Operative Agreements and no Default or
Event of Default under any of the Operative Agreements will have occurred
after giving effect to the Advance requested by such Requisition;
(g) the Construction Agent shall have delivered to the Agent, title
insurance commitments to issue policies in favor of the Lessor and the
Agent from a title insurance company and in form and substance acceptable
to the Agent, with such title exceptions thereto as are acceptable to the
Agent;
(h) the Construction Agent shall have delivered to the Agent and the
Lessor an environmental site assessment prepared by an independent
recognized professional acceptable to the Agent and the Lessor and in a
form and substance that is acceptable to the Agent and the Lessor;
(i) the Construction Agent shall have delivered to the Agent a survey
prepared by an independent recognized professional acceptable to the Agent
and in a form and substance acceptable to the Agent;
(j) the Construction Agent shall have caused to be delivered to the
Agent and the Lessor (i) a legal opinion (in form and substance
satisfactory to the Agent) from counsel located in the state where the
Property is located and (ii) a good standing certificate for the
Construction Agent from the appropriate officer of the state in which the
Property is located;
(k) the Lessor and the Agent shall be satisfied, in their discretion,
that the acquisition and/or holding of the Property and the execution of
the Mortgage Instrument and the other Security Documents will not adversely
affect the rights of the Lessor, the Holders, the Agent or the Lenders
under or with respect to the Operative Agreements;
(l) the Lessor shall have delivered to the Agent and there shall have
been recorded by the Agent a Mortgage Instrument and the Lender Financing
Statements
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respecting such Property in a form acceptable to the Agent and all
necessary recording fees, documentary stamp taxes and similar amounts shall
have been paid;
(m) the Construction Agent shall have delivered to the Agent with
respect to each Property, a Lease Supplement and a memorandum regarding the
Lease and such Lease Supplement (such memorandum to be substantially in the
form attached as Exhibit B to the Lease and in form suitable for
recording); provided, such items shall be delivered pursuant to this
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Section 5.3(m) on the Property Closing Date for such Property only if the
Basic Term Commencement Date for such Property shall also occur on such
Property Closing Date;
(n) the Construction Agent shall have delivered to the Agent with
respect to each Property or the acquisition of personal property and/or
fixtures in accordance with the Operative Agreements, Lessor Financing
Statements executed by the Lessee and the Lessor;
(o) (i) with respect to each Acquisition Advance, the Available
Commitment and the Available Holder Commitment (after deducting the
Unfunded Amount) will be sufficient to acquire the Property and to pay
interest regarding the Loans and the Holder Yield regarding the Holder
Fundings relating to all Properties to the extent accrued under the Credit
Agreement and the Trust Agreement, as the case may be, during the period
prior to the Basic Term Commencement Date with respect to such Properties;
and (ii) based upon the construction schedule relating to any Construction
Period Property, there is sufficient time for Completion of such
Construction Period Property to occur on or prior to the Construction
Period Termination Date;
(p) if the Property is subject to a Ground Lease the Construction
Agent shall have caused a lease memorandum (in form and substance
satisfactory to the Agent) to be delivered to the Agent for such Ground
Lease;
(q) Counsel for the ground lessor of each Property subject to a
Ground Lease shall have issued to the Lessee, the Holders, the Lenders and
the Agent its opinion (in form and substance satisfactory to the Agent);
(r) the Construction Agent shall have delivered to the Agent a
preliminary construction budget (the "Construction Budget") for the
Improvements (if any) to be constructed on such Property;
(s) the Construction Agent shall have provided evidence of general
and excess liability insurance with respect to such Property as provided in
the Lease; and
(t) in their sole and absolute discretion, the Lenders and the
Holders shall have agreed to accept, and to fund the respective Loans and
Holder Fundings regarding, the particular property then under consideration
as a Property; provided, however, it is hereby understood and agreed that
-------- -------
that certain office building to be constructed at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇
▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, its respective interest in the related 5-story
parking garage and the related ground lease for the real property at such
location is an acceptable Property.
5.4 CONDITIONS TO THE HOLDERS' AND THE LENDERS' OBLIGATIONS TO MAKE
---------------------------------------------------------------
CONSTRUCTION ADVANCES FOR THE ONGOING CONSTRUCTION ON ANY PROPERTY
------------------------------------------------------------------
PRIOR TO THE CONSTRUCTION PERIOD TERMINATION DATE.
--------------------------------------------------
The obligations of the Holders to make a Holder Funding, and the Lenders to
make Loans, to the Lessor, (i) in connection with all requests for Advances
subsequent to the acquisition of a Property (and to pay the Transaction
Expenses, fees, expense and other disbursements payable by the Lessor under
Article IX of this Agreement in connection therewith) and, (ii) to pay the
Holder Yield regarding the Holder Fundings relating to a Property and interest
regarding the Loans relating to a Property, in each case regarding such Holder
Yield and Interest to the extent accrued and payable under the Credit Agreement
or Trust Agreement (as the case may be), during the period prior to the Basic
Term Commencement Date with respect to such Property, are subject to the
satisfaction or waiver of the following conditions precedent:
(a) the correctness in all material respects on such date of the
representations and warranties (including without limitation the
Incorporated Representations and Warranties) of the Lessor, the
Construction Agent, the Lessee and the Holders contained herein and in each
of the other Operative Agreements;
(b) the performance in all material respects by the Construction
Agent and the Lessee of their respective agreements contained herein and in
the other Operative Agreements and to be performed by them on or prior to
each such date;
(c) the Agent shall have received a fully executed counterpart of the
Requisition, appropriately completed;
(d) (i) based upon the applicable Construction Budget, the Available
Commitments and the Available Holder Commitment (after deducting the
Unfunded Amount) will be sufficient to complete the Improvements including
interest on Loans and yield on Holder Fundings related thereto prior to the
Basic Term Commencement Date for such Property; and (ii) based upon the
construction schedule relating to any Construction Period Property, there
is sufficient time for Completion of such Construction Period Property to
occur on or prior to the Construction Period Termination Date;
(e) there shall not have occurred and be continuing any Default or
Event of Default under any of the Operative Agreements and no Default or
Event of Default under any of the Operative Agreements will have occurred
after giving effect to the Construction Advance requested by such
Requisition;
(f) the title insurance policy delivered in connection with the
requirements of Section 5.3(g) shall provide for (or shall be endorsed to
provide for) insurance in an amount at least equal to the maximum total
Property Cost indicated by the Construction Budget
9
referred to in subparagraph (d) above and there shall be no title change or
exception objectionable to the Agent;
(g) the Construction Agent or Lessee shall have delivered to the
Agent copies of the Plans and Specifications for the applicable
Improvements; and
(h) the Construction Agent or Lessee shall have caused an Appraisal
regarding such Property on an as-built basis to be provided to the Agent
from an appraiser selected by the Agent, which Appraisal (including the
cost of Equipment located at such Property) shall indicate that the Fair
Market Sale Value of the Property as of the Property Completion Date shall
be at least equal to 75% of the Property Cost for such Property.
5.5 ADDITIONAL REPORTING AND DELIVERY REQUIREMENTS ON COMPLETION DATE
-----------------------------------------------------------------
RESPECTING EACH PROPERTY.
-------------------------
On the Completion Date for each Property, the Construction Agent shall
deliver to the Agent (with a copy to counsel for the Agent) an Officer's
Certificate in the form attached hereto as Exhibit B specifying (a) the
---------
Completion Date for the construction of Improvements at the Property and (b) the
aggregate Property Cost for the Property. Such Officer's Certificate shall also
include, in form reasonably acceptable to the Agent, detailed, itemized
documentation supporting the asserted Property Cost figures and a certification
to the effect that all Improvements have been made in accordance with all
applicable material Legal Requirements, in a good and workmanlike manner in
accordance with the Plans and Specifications and otherwise in full compliance
with the standards and practices of the Construction Agent with respect to
properties and improvements owned by the Construction Agent. The Agent shall
have the right to contest the information contained in such Officer's
Certificate. Furthermore, on the Completion Date for each Property, the
Construction Agent shall deliver or cause to be delivered to the Agent (unless
previously delivered to the Agent) originals of the following, each of which
shall be in form reasonably acceptable to the Agent: (u) an as-built survey for
the applicable Property; (v) insurance certificates respecting the Property as
required hereunder and under the Lease Agreement; (w) a Lease Supplement, (x) a
memorandum of the Lease and such Lease Supplement (in form suitable for
recording), and (y) Lessor Financing Statements executed by the Lessee and the
Lessor. In addition, as of the Completion Date for such Property the
Construction Agent covenants and agrees that the recording fees, documentary
stamp taxes or similar amounts required to be paid in connection with the
related Mortgage Instrument shall be paid (or shall have been paid) in an amount
required by applicable law.
5.6 CONSTRUCTION AGENT DELIVERY OF CONSTRUCTION BUDGET MODIFICATIONS.
-----------------------------------------------------------------
The Construction Agent covenants and agrees to deliver to the Agent each
month notification of any modification to any Construction Budget regarding each
Property if such modification increases the cost to construct such Property;
provided, no Construction Budget shall be increased unless (a) the title
insurance policies referenced in Section 5.3(g) are also modified or endorsed,
if necessary, to provide for insurance in an amount that satisfies the
requirements of
10
Section 5.4(f) of this Agreement, and (b) after giving effect to any such
amendment the Construction Budget remains in compliance with the requirements of
Section 5.4(d) and 5.4(h) of this Agreement.
5.7 MAINTENANCE OF THE LESSEE AS A WHOLLY-OWNED ENTITY.
---------------------------------------------------
From the Initial Closing Date and thereafter until such time as all
obligations of all Credit Parties under the Operative Agreements have been
satisfied and performed in full, Capital One Financial Corporation shall retain
the Lessee as a Wholly-Owned Entity.
5.8 UNILATERAL RIGHT TO INCREASE THE HOLDER COMMITMENTS AND THE LENDER
------------------------------------------------------------------
COMMITMENTS.
------------
Notwithstanding any other provision of any Operative Agreement or any
objection by any Person (including without limitation any objection by any
Credit Party), (a) each Holder, in its sole discretion, may unilaterally elect
to increase its Holder Commitment in order to fund amounts due and owing
pursuant to Article IX and/or Section 13.6 and (b) each Lender, in its sole
discretion, may unilaterally elect to increase its Lender Commitment in order to
fund amounts due and owing pursuant to Article IX and/or Section 13.6.
5.9 BORROWER'S RIGHT TO INCREASE THE COMMITMENTS UNDER THE ▇▇▇▇ CREDIT
------------------------------------------------------------------
AGREEMENT AND THE HOLDER COMMITMENTS ALLOCABLE TO THE ▇▇▇▇ TRUST
----------------------------------------------------------------
ESTATE.
------
The parties hereto hereby acknowledge and agree that, so long as no Default
or Event of Default shall have occurred and be continuing, the Borrower may, at
any one time during the Commitment Period upon five (5) Business Days written
notice to the Agent, increase the Commitments under that certain Credit
Agreement (Capital One Realty, Inc.) dated as of the Initial Closing Date among
the Borrower, the several Lenders, Partners thereto from time to time and Bank
of America, N.A., as Administrative Agent to up to $115,400,000 and the Holder
Commitments allocable to the ▇▇▇▇ Trust Estate to up to $4,600,000; provided,
--------
however, that such increase shall only be effective if the Agent has received
-------
(i) pursuant to Section 2.5(a) of the Credit Agreement notice of a corresponding
reduction in the Commitments thereunder and (ii) pursuant to the Trust
Agreement, notice of a corresponding reduction in Holder Commitments allocable
to the COSI Trust Estate.
5.10 ADDITIONAL HOLDER REPRESENTATIONS; LESSEE'S RIGHT TO REPLACE HOLDER.
-------------------------------------------------------------------
(a) At the reasonable written request of the Lessee, each of the
Holders hereby agrees to use commercially reasonable efforts to provide
additional representations and warranties (in addition to the
representations and warranties set forth in Section 7.1(j)) concerning the
nature and type of financing of Holder Fundings made by each such Holder;
provided, in no
--------
event shall any Holder be obligated (under this Section 5.10 or otherwise)
to provide any representation or warranty regarding the ultimate financial
or
11
accounting treatment accorded to, or tax characterization of, any such
Holder Fundings, nor shall the Lessee be entitled to rely on any such
representation or warranty made by any Holder.
(b) In the event that any Holder is unable to make a representation,
as described in Section 5.10(a) to the reasonable satisfaction of the
Lessee, the Lessee shall have the right, subject to the repayment in full
of all Advances and all other amounts due such Holder (including all
amounts due to such Person in its capacity as a Lender), to replace such
Holder by requiring such Holder to assign, without recourse, its interests,
rights (except for rights to be indemnified for actions taken while a party
hereunder) and obligations under the Operative Agreements (including,
without limitation the Trust Agreement) in accordance with the procedure
set forth in Section 3.11(c) of the Trust Agreement; provided, to the
--------
extent such Holder is also a Lender, the Lessee shall also cause such
Lender to assign, without recourse, its interests, rights (except for
rights to be indemnified for actions taken while a party hereunder) and
obligations under the Operative Agreements (including, without limitation,
the Credit Agreement) in accordance with the procedure set forth in Section
2.14(b) of the Credit Agreement.
SECTION 6 CONDITIONS OF THE INITIAL CLOSING.
6.1 CONDITIONS TO THE LESSOR'S AND THE HOLDERS' OBLIGATIONS.
-------------------------------------------------------
The obligations of the Lessor and the Holders to consummate the
transactions contemplated by this Agreement, including the obligation to execute
and deliver the applicable Operative Agreements to which each is a party on the
Initial Closing Date, are subject to (i) the accuracy and correctness on the
Initial Closing Date of the representations and warranties of the other parties
hereto contained herein, (ii) the accuracy and correctness on the Initial
Closing Date of the representations and warranties of the other parties hereto
contained in any other Operative Agreement or certificate delivered pursuant
hereto or thereto, (iii) the performance by the other parties hereto of their
respective agreements contained herein and in the other Operative Agreements and
to be performed by them on or prior to the Initial Closing Date and (iv) the
satisfaction or waiver by the Lessor and the Holders of all of the following
conditions on or prior to the Initial Closing Date:
(a) Each of the Operative Agreements to be entered into on the
Initial Closing Date shall have been duly authorized, executed and
delivered by the parties thereto, other than the Lessor, and shall be in
full force and effect, and no Default or Event of Default shall exist
thereunder (both before and after giving effect to the transactions
contemplated by the Operative Agreements), and the Lessor shall have
received a fully executed copy of each of the Operative Agreements (other
than the Notes of which it shall have received specimens). The Operative
Agreements (or memoranda thereof), any supplements thereto and any
financing statements and fixture filings in connection therewith required
under the Uniform Commercial Code shall have been filed or shall be
promptly filed, if necessary, in such manner as to enable the Lessee's
counsel to render its opinion referred to in Section 6.1(c) hereof;
12
(b) All taxes, fees and other charges in connection with the
execution, delivery, recording, filing and registration of the Operative
Agreements shall have been paid or provisions for such payment shall have
been made to the satisfaction of the Lessor and the Agent;
(c) Counsel for the Lessee acceptable to the other parties hereto
shall have issued to the Lessor, the Agent, the Lenders and the Holders its
opinion in the form attached hereto as Exhibit C or in such other form as
---------
is reasonably acceptable to such parties;
(d) All necessary (or in the reasonable opinion of the Agent or its
counsel, advisable) Governmental Actions, in each case required by any law
or regulation enacted, imposed or adopted on or after the date hereof or by
any change in fact or circumstances since the date hereof, shall have been
obtained or made and be in full force and effect unless the failure to
obtain such item would not have a Material Adverse Effect;
(e) No action or proceeding shall have been instituted, nor shall any
action or proceeding be overtly threatened, before any Governmental
Authority, nor shall any order, judgment or decree have been issued or
proposed to be issued by any Governmental Authority or to set aside,
restrain, enjoin or prevent the full performance of this Agreement, any
other Operative Agreement or any transaction contemplated hereby or thereby
which is reasonably likely to have a Material Adverse Effect;
(f) In the reasonable opinion of the Lessor, the Agent, the Holders
and their counsel, the transactions contemplated by the Operative
Agreements do not and will not violate any Legal Requirements and do not
and will not subject the Lessor, the Lenders, the Agent or the Holders to
any adverse regulatory prohibitions or constraints;
(g) The Lessor, the Agent and the Holders shall each have received an
Officer's Certificate, dated as of the Initial Closing Date, of each Credit
Party in the form attached hereto as Exhibit D or in such other form as is
---------
reasonably acceptable to such parties stating that (i) each and every
representation and warranty of such Credit Party contained in the Operative
Agreements to which it is a party is true and correct in all material
respects on and as of the Initial Closing Date; (ii) no Default or Event of
Default has occurred and is continuing under any Operative Agreement; (iii)
each Operative Agreement to which such Credit Party is a party is in full
force and effect with respect to it; and (iv) such Credit Party has
performed and complied with all covenants, agreements and conditions
contained herein or in any Operative Agreement required to be performed or
complied with by it on or prior to the Initial Closing Date;
(h) The Lessor, the Agent and the Holders shall each have received
(i) a certificate of the Secretary or an Assistant Secretary of each Credit
Party in the form attached hereto as Exhibit E or in such other form as is
---------
reasonably acceptable to such parties attaching and certifying as to (1)
the resolutions of its Board of Directors duly authorizing the execution,
delivery and performance by such Credit Party of each of the Operative
13
Agreements to which it is or will be a party, (2) its certificate of
incorporation and by-laws, in each case certified as of a recent date by
the Secretary of State of the state of its incorporation and (3) the
incumbency and signature of persons authorized to execute and deliver on
its behalf the Operative Agreements to which it is a party and (ii) a good
standing certificate from the appropriate officer of each Credit Party's
state of incorporation or formation and the state where such Credit Party's
principal place of business is located as to its good standing in such
state(s); and
(i) As of the Initial Closing Date, there shall not have occurred any
material adverse change in the consolidated assets, liabilities,
operations, business or financial condition of the Guarantor and its
Subsidiaries, taken as a whole, from that set forth in the consolidated
financial statements of the Guarantor dated March 31, 1999.
6.2 CONDITIONS TO THE LESSEE'S OBLIGATIONS.
--------------------------------------
The obligation of the Lessee to consummate the transactions contemplated by
this Agreement, including the obligation to execute and deliver the Operative
Agreements to which it is a party on the Initial Closing Date, is subject to (i)
the accuracy and correctness on the Initial Closing Date of the representations
and warranties of the other parties hereto contained herein, (ii) the accuracy
and correctness on the Initial Closing Date of the representations and
warranties of the other parties hereto contained in any other Operative
Agreement or certificate delivered pursuant hereto or thereto, (iii) the
performance by the other parties hereto of their respective agreements contained
herein and in the other Operative Agreements, in each case to be performed by
them on or prior to the Initial Closing Date, and (iv) the satisfaction or
waiver by the Lessee of all of the following conditions on or prior to the
Initial Closing Date:
(a) In the reasonable opinion of the Lessee and its counsel, the
transactions contemplated by the Operative Agreements do not violate any
material Legal Requirements and shall not subject Lessee to any adverse
regulatory prohibitions or constraints, in each case enacted, imposed,
adopted or proposed since the date hereof;
(b) No action or proceeding shall have been instituted nor shall any
action or proceeding be threatened, before any Governmental Authority, nor
shall any order, judgment or decree have been issued or proposed to be
issued by any Governmental Authority or to set aside, restrain, enjoin or
prevent the full performance of this Agreement, any other Operative
Agreement or any transaction contemplated hereby or thereby which is
reasonably likely to have a Material Adverse Effect;
(c) Each of the Operative Agreements shall have been duly authorized,
executed and delivered by the parties thereto, other than the Lessee, and
shall be in full force and effect, and no Default, other than Defaults of
the Lessee, shall exist thereunder, and the Lessee shall have received a
fully executed copy of each of the Operative Agreements;
(d) The Lessee and the Agent shall have received an Officer's
Certificate of the Lessor dated as of such Closing Date in the form
attached hereto as Exhibit F or in
---------
14
other form as is reasonably acceptable to Lessee and the Agent, stating
that (i) each and every representation and warranty of the Lessor contained
in the Operative Agreements to which it is a party is true and correct on
and as of the Initial Closing Date; (ii) each Operative Agreement to which
the Lessor is a party is in full force and effect with respect to it, and
(iii) the Lessor has duly performed and complied with all covenants,
agreements and conditions contained herein or in any Operative Agreement
required to be performed or complied with by it on or prior to the Initial
Closing Date;
(e) The Lessee and the Agent shall have received (i) a certificate of
the Secretary, an Assistant Secretary, Trust Officer or Vice President of
the Trust Company in the form attached hereto as Exhibit G or in such other
---------
form as is reasonably acceptable to Lessee and the Agent, attaching and
certifying as to (A) the signing resolutions, (B) its articles of
incorporation or other equivalent charter documents, as the case may be,
certified as of a recent date by an appropriate officer of the Trust
Company, (C) its by-laws and (D) the incumbency and signature of persons
authorized to execute and deliver on its behalf the Operative Agreements to
which it is a party and (ii) a good standing certificate from the Office of
the Comptroller of the Currency regarding the Trust Company; and
(f) Counsel for the Lessor acceptable to the other parties hereto
shall have issued to the Lessee, the Holders, the Lenders and the Agent its
opinion in the form attached hereto as Exhibit H or in such other form as
---------
is reasonably acceptable to such parties.
6.3 Conditions to the Agent's Obligations.
-------------------------------------
The obligation of the Agent to consummate the transactions contemplated by
this Agreement on the Initial Closing Date, including the obligation to execute
and deliver each of the Operative Agreements to which it is a party on the
Initial Closing Date, is subject to (i) the accuracy and correctness on the
Initial Closing Date of the representations and warranties of the other parties
hereto contained herein, (ii) the accuracy and correctness on the Initial
Closing Date of the representations and warranties of the other parties hereto
contained in any other Operative Agreement or certificate delivered pursuant
hereto or thereto, (iii) the performance by the other parties hereto of their
respective agreements contained herein and in the other Operative Agreements, in
each case to be performed by them on or prior to the Initial Closing Date, and
(iv) the receipt by the Agent of the items required to be delivered to the Agent
pursuant to this Section 6.
SECTION 7 REPRESENTATIONS AND WARRANTIES ON THE INITIAL CLOSING DATE.
7.1 Representations and Warranties of the Holders.
---------------------------------------------
Effective as of the Initial Closing Date, each Holder severally as to
itself, and not jointly, represents and warrants to each of the other parties
hereto that:
15
(a) It is duly organized, validly existing and in good standing under
the laws of the United States of America or the jurisdiction of its
formation or organization and has the power and authority to carry on its
business as now conducted and to enter into and perform its obligations
under each Operative Agreement to which it is or is to be a party and each
other agreement, instrument and document to be executed and delivered by it
on or before each Closing Date in connection with or as contemplated by
each such Operative Agreement to which it is or will be a party;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party have been duly authorized by
all necessary action on its part and neither the execution and delivery
thereof, nor the consummation of the transactions contemplated thereby, nor
compliance by it with any of the terms and provisions thereof (i) requires
or will require any approval of the partners or stockholders of, or
approval or consent of any trustee or holder of any indebtedness or
obligations of, the Holder which have not been obtained, (ii) contravenes
or will contravene any Legal Requirement applicable to or binding on it
(except no representation or warranty is made as to any Legal Requirement
to which it may be subject solely as a result of the activities of the
Lessee) as of the date hereof, (iii) does or will contravene or result in
any breach of or constitute any default under, or result in the creation of
any Lien upon any Property or any of the Improvements (other than Liens
created by the Operative Agreements) under its certificate of incorporation
or other equivalent charter documents, as the case may be, or any material
indenture, mortgage, chattel mortgage, deed of trust, conditional sales
contract, bank loan or credit agreement or other agreement or instrument to
which it is a party or by which it or its properties is bound or affected
or (iv) does or will require any Governmental Action by any Governmental
Authority (other than arising solely by reason of the business, condition
or activities of the Lessee or any Affiliate thereof or the construction or
use of the Properties or the Improvements);
(c) Each Operative Agreement to which it is or will be a party has
been, or will be, duly executed and delivered by it and constitutes, or
upon execution and delivery will constitute, a legal, valid and binding
obligation enforceable against it in accordance with the terms thereof;
(d) To its knowledge, there is no action or proceeding pending or
threatened against it before any Governmental Authority that questions the
validity or enforceability of any Operative Agreement to which it is or
will become a party or that, if adversely determined, would materially and
adversely affect its ability to perform its obligations under the Operative
Agreements to which it is a party;
(e) It has not assigned or transferred any of its right, title or
interest in or under the Lease except in accordance with the Operative
Agreements;
(f) [Reserved];
16
(g) It is not a "holding company" or a "subsidiary company" of a
"holding company" or an "affiliate" of a "holding company" or a "public
utility" within the meaning of the Public Utility Holding Company Act of
1935, as amended, or a "public utility" within the meaning of the Federal
Power Act, as amended. It is not an "investment company" or a company
controlled by an "investment company" within the meaning of the Investment
Company Act or an "investment adviser" within the meaning of the Investment
Advisers Act of 1940, as amended;
(h) Except as otherwise contemplated by the Operative Agreements, it
shall not, nor shall it direct the Lessor to, use the proceeds of any Loan
or Holder Funding for any purpose other than purchase and/or lease of the
Properties, the construction of Improvements, the payment of the
Transaction Expenses and the fees, expenses and other disbursements
referenced in Sections 9.1 or 13.6 of this Agreement and the payment of the
interest regarding the Loans and the Holder Yield regarding the Holder
Fundings which accrues prior to the Rent Commencement Date with respect to
the Property; and
(i) It is acquiring its interest in the COSI Trust Estate for its own
account for investment and not with a view to any distribution. Neither it
nor anyone authorized to act on its behalf has taken or will take any
action which would subject the issuance or sale of any interest in the
Property, the COSI Trust Estate or the Lease to the registration
requirements of Section 5 of the Securities Act. No representation or
warranty contained in this Section 7.1(i) shall include or cover any action
or inaction of the Lessee or any Affiliate thereof whether or not
purportedly on behalf of the Holders, the Borrower or any of their
Affiliates; and
(j) It has not and will not (i) finance Holder Advances with
nonrecourse debt that is collateralized by a Lien on the Construction
Period Properties, the Properties, or the Lease or cashflows therefrom; or
(ii) obtain a residual guarantee on the Holder Advances through a letter of
credit or other form of guarantee.
7.2 Representations and Warranties of the Borrower.
----------------------------------------------
Effective as of the Initial Closing Date, Trust Company in its individual
capacity and as the Borrower, as indicated, represents and warrants to each of
the other parties hereto as follows, provided, that the representations in the
following paragraphs (h), (i), (j) and (k) are made solely in its capacity as
the Borrower:
(a) It is a national banking association and is duly organized and
validly existing and in good standing under the laws of the United States
of America and has the power and authority to enter into and perform its
obligations under the Trust Agreement and (assuming due authorization,
execution and delivery of the Trust Agreement by the Holders) has the
corporate and trust power and authority to act as the Owner Trustee and to
enter into and perform the obligations under each of the other Operative
Agreements to which Trust Company or the Owner Trustee, as the case may be,
is or will be a party and each other agreement, instrument and document to
be executed and delivered by it on or
17
before such Closing Date in connection with or as contemplated by each such
Operative Agreement to which Trust Company or the Owner Trustee, as the
case may be, is or will be a party;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party, either in its individual
capacity or (assuming due authorization, execution and delivery of the
Trust Agreement by the Holders) as the Owner Trustee, as the case may be,
has been duly authorized by all necessary action on its part and neither
the execution and delivery thereof, nor the consummation of the
transactions contemplated thereby, nor compliance by it with any of the
terms and provisions thereof (i) does or will require any approval or
consent of any trustee or holders of any of its indebtedness or
obligations, (ii) does or will contravene any current law, governmental
rule or regulation relating to its banking or trust powers, (iii) does or
will contravene or result in any breach of or constitute any default under,
or result in the creation of any Lien upon any of its property under, (A)
its charter or by-laws, or (B) any indenture, mortgage, chattel mortgage,
deed of trust, conditional sales contract, bank loan or credit agreement or
other agreement or instrument to which it is a party or by which it or its
properties may be bound or affected, which contravention, breach, default
or Lien under clause (B) would materially and adversely affect its ability,
in its individual capacity or as Owner Trustee, to perform its obligations
under the Operative Agreements to which it is a party or (iv) does or will
require any Governmental Action by any Governmental Authority regulating
its banking or trust powers;
(c) The Trust Agreement and, assuming the Trust Agreement is the
legal, valid and binding obligation of the Holders, each other Operative
Agreement to which Trust Company or the Owner Trustee, as the case may be,
is or will be a party have been, or on or before such Closing Date will be,
duly executed and delivered by Trust Company or the Owner Trustee, as the
case may be, and the Trust Agreement and each such other Operative
Agreement to which Trust Company or the Owner Trustee, as the case may be,
is a party constitutes, or upon execution and delivery will constitute, a
legal, valid and binding obligation enforceable against Trust Company or
the Owner Trustee, as the case may be, in accordance with the terms
thereof;
(d) There is no action or proceeding pending or, to its knowledge,
threatened to which it is or will be a party, either in its individual
capacity or as the Owner Trustee, before any Governmental Authority that,
if adversely determined, would materially and adversely affect its ability,
in its individual capacity or as Owner Trustee, to perform its obligations
under the Operative Agreements to which it is a party or would question the
validity or enforceability of any of the Operative Agreements to which it
is or will become a party;
(e) It has not assigned or transferred any of its right, title or
interest in or under the Lease or the Agency Agreement except in accordance
with the Operative Agreements;
18
(f) No Default or Event of Default under the Operative Agreements
attributable to it has occurred and is continuing;
(g) Except as otherwise contemplated in the Operative Agreements, the
proceeds of the Loans and Holder Fundings shall not be applied by the Owner
Trustee for any purpose other than the payment of Transaction Expenses and
the fees, expenses and other disbursements referenced in Sections 9.1(a),
9.1(b) and 13.6 of this Agreement, the purchase and/or lease of the
Properties, the acquisition of the Equipment, the construction of
Improvements and the payment of interest regarding the Loans and the
payment of the Holder Yield regarding the Holder Fundings, in each case to
the extent accrued under the Credit Agreement or Trust Agreement (as the
case may be) during the period prior to the Basic Term Commencement Date
with respect to a particular Property;
(h) Neither the Owner Trustee nor any Person authorized by the Owner
Trustee to act on its behalf has offered or sold any interest in the COSI
Trust Estate or the Notes, or in any similar security relating to a
Property, or in any security the offering of which for the purposes of the
Securities Act would be deemed to be part of the same offering as the
offering of the aforementioned securities to, or solicited any offer to
acquire any of the same from, any Person other than, in the case of the
Notes, the Agent, and neither the Owner Trustee nor any Person authorized
by the Owner Trustee to act on its behalf will take any action which would
subject, as a direct result of such action alone, the issuance or sale of
any interest in the COSI Trust Estate or the Notes to the provisions of
Section 5 of the Securities Act or require the qualification of any
Operative Agreement under the Trust Indenture Act of 1939, as amended;
(i) The Owner Trustee's chief place of business, chief executive
office and office where the documents, accounts and records relating to the
transactions contemplated by this Agreement and each other Operative
Agreement are kept are located at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇;
(j) The Owner Trustee is not engaged principally in, and does not
have as one of its important activities, the business of extending credit
for the purpose of purchasing or carrying any margin stock (within the
meaning of Regulation U of the Board of Governors of the Federal Reserve
System of the United States), and no part of the proceeds of the Loans or
the Holder Fundings will be used by it to purchase or carry any margin
stock or to extend credit to others for the purpose of purchasing or
carrying any such margin stock or for any purpose that violates, or is
inconsistent with, the provisions of Regulations G, T, U, or X of the Board
of Governors of the Federal Reserve System of the United States; and
(k) The Owner Trustee is not an "investment company" or a company
controlled by an "investment company" within the meaning of the Investment
Company Act.
19
7.3 Representations and Warranties of the Construction Agent and the
----------------------------------------------------------------
Credit Parties.
--------------
Effective as of the Initial Closing Date and the Basic Term Commencement
Date, as applicable, respecting each applicable Property, the Construction Agent
and each Credit Party, unless otherwise specified hereunder, represents and
warrants, as to itself, to each of the other parties hereto that:
(a) With respect to the Guarantor, the Incorporated Representations
and Warranties are true and correct and the Guarantor has delivered to each
of the Lenders and Holders the financial statements referred to in Section
8.01 of the Capital One Credit Agreement.
(b) The execution and delivery by the Construction Agent or such
Credit Party of this Agreement and the other Operative Agreements to which
the Construction Agent or such Credit Party is a party and the performance
by the Construction Agent or such Credit Party of its respective
obligations under this Agreement and the other Operative Agreements is
within the corporate powers of the Construction Agent or such Credit Party,
has been duly authorized by all necessary corporate action on the part of
the Construction Agent or such Credit Party (including any necessary
shareholder action), has received all necessary governmental approval, and
does not and will not (i) violate any material provision of applicable Law,
decree, judgment or award which is binding on the Construction Agent or
such Credit Party or any of their Subsidiaries unless such violation would
not have a Material Adverse Effect, (ii) contravene or conflict with, or
result in a breach of, any provision of the Certificate of Incorporation,
By-Laws or other organizational documents of the Construction Agent or such
Credit Party or any of their Subsidiaries or of any agreement, indenture,
instrument or other document which is binding on the Construction Agent or
such Credit Party or any of their Subsidiaries unless such conflict or
breach would not have a Material Adverse Effect or (iii) result in, or
require, the creation or imposition of any Lien (other than pursuant to the
terms of the Operative Agreements) on any asset of the Construction Agent
or such Credit Party or any of their Subsidiaries.
(c) This Agreement is, and upon the execution and delivery thereof
the other Operative Agreements will be, the legal, valid and binding
obligation of the Construction Agent or such Credit Party that is a party
thereto, enforceable against the Construction Agent or such Credit Party
that is a party thereto in accordance with their terms, except (i) as may
be limited by bankruptcy, insolvency, receivership, conservatorship,
reorganization, moratorium or similar laws of general applicability
affecting the enforcement of creditors' rights and (ii) such enforceability
may be limited by the application of general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law). The Construction Agent or such Credit Party has executed
the various Operative Agreements required to be executed as of such date.
(d) [Intentionally Omitted].
20
(e) No Governmental Action by any Governmental Authority or
authorization, registration, consent, approval, waiver, notice or other
action by, to or of any other Person is required to authorize or is
required in connection with (i) the Construction Agent's or such Credit
Party's execution, delivery or performance of any Operative Agreement or
(ii) the legality, validity, binding effect or enforceability of any
Operative Agreement on the Construction Agent or such Credit Party that is
a party thereto, in each case, except those which have been obtained or
where failure to obtain would not cause a Material Adverse Effect.
(f) Upon the execution and delivery of each Lease Supplement to the
Lease, (i) the Lessee will have unconditionally accepted the Property
subject to the Lease Supplement and will have a valid and subsisting
leasehold interest in the Property, subject only to the Permitted
Exceptions, and (ii) no offset will exist with respect to any Rent or other
sums payable under the Lease.
(g) Except as otherwise contemplated by the Operative Agreements, the
Construction Agent shall not use the proceeds of any Holder Funding or Loan
for any purpose other than the purchase of the Properties, the acquisition
of the Equipment and the construction of Improvements.
(h) All information heretofore or contemporaneously herewith
furnished by any Credit Party or any of their Subsidiaries to the Agent,
the Owner Trustee, any Lender or any Holder for purposes of or in
connection with this Agreement and the transactions contemplated hereby is,
and all information hereafter furnished by or on behalf of any Credit Party
or any of their Subsidiaries to the Agent, the Owner Trustee, any Lender or
any Holder pursuant hereto or in connection herewith will be, true and
accurate (when taken as a whole) in every material respect on the date as
of which such information is dated or certified, and such information,
taken as a whole, does not and will not omit to state any material fact
necessary to make such information, taken as a whole, not misleading.
(i) Each Credit Party has (i) initiated a review and assessment of
all areas within its and each of its Subsidiaries' business and operations
that would be adversely affected by the "Year 2000 Problem" (that is, the
risk that computer applications used by such Credit Party or any of its
Subsidiaries may be unable to recognize and perform properly date-sensitive
functions involving certain dates prior to, in and following the Year
2000), (ii) developed a plan for addressing the Year 2000 Problem on a
timely basis and (iii) initiated implementation of that plan. Based on the
foregoing, each Credit Party believes that any reprogramming or
replacements required to permit the proper functioning, prior to, in and
following the Year 2000, of (i) such Credit Party's material computer
systems and (ii) material equipment of such Credit Party containing
embedded microchips (including systems and equipment supplied by others or
with which such Credit Party's systems interface) and the verification of
all such systems and equipment, as so reprogrammed or replaced, as the case
may be, will be completed by September 1, 1999, except to the extent the
failure to so complete such reprogramming or replacement
21
could not reasonably be expected to have a Material Adverse Effect. Each
Credit Party believes that any reprogramming or replacements required to
permit the proper functioning in and following the Year 2000 of its
computer systems and any necessary equipment of such Credit Party
containing embedded microchips and the testing of all such systems and
equipment as so reprogrammed or replaced will be completed in a manner and
to the extent that any failure by such Credit Party to complete any such
reprogramming, replacement or testing will not result in a Default or could
not reasonably be expected to have a Material Adverse Effect.
7.4 Representations and Warranties of the Agent.
-------------------------------------------
Effective as of the Initial Closing Date, the Agent represents and warrants
to each of the other parties hereto that:
(a) It is a national banking association duly organized and validly
existing under the laws of the United States of America and has the full
power and authority to enter into and perform its obligations under this
Agreement and each other Operative Agreement to which it is or will be a
party;
(b) This Agreement and each other Operative Agreement to which it is
a party have been, or when executed and delivered will be, duly authorized
by all necessary corporate action on the part of the Agent and have been,
or on such Closing Date will have been, duly executed and delivered by the
Agent and, assuming the due authorization, execution and delivery hereof
and thereof by the other parties hereto and thereto, are, or upon execution
and delivery thereof will be, legal, valid and binding obligations of the
Agent, enforceable against it in accordance with their respective terms;
(c) The execution, delivery and performance by the Agent of this
Agreement and each other Operative Agreement to which it is or will be a
party are not, and will not be, inconsistent with the articles of
incorporation or by-laws or other charter documents of the Agent, do not
and will not contravene any applicable Law of the State of Texas or of the
United States of America governing its activities and will not contravene
any provision of, or constitute a default under any indenture, mortgage,
contract or other instrument of which it is a party or by which it or its
properties are bound, or require any consent or approval of any
Governmental Authority under any applicable law, rule or regulation of the
State of Texas or any federal law, rule or regulation of the United States
of America governing its activities; and
(d) Except as otherwise contemplated by the Operative Agreements, the
Agent shall not, nor shall it direct the Lessor to, use the proceeds of any
Loan for any purpose other than the purchase of the Properties, the
acquisition of Equipment, the construction of Improvements and the payment
of Transaction Expenses, interest regarding the Loans which accrue under
the Credit Agreement during the period prior to the Basic Term Commencement
Date with respect to a particular Property and other uses authorized under
the Operative Agreements.
22
SECTION 8 REPRESENTATIONS AND WARRANTIES ON FUNDING DATES.
8.1 Representations and Warranties on Property Closing Dates.
--------------------------------------------------------
The Construction Agent and each Credit Party hereby represents and warrants
as to itself as of each Property Closing Date as follows:
(a) The representations and warranties (including the Incorporated
Representations and Warranties in the case of the Guarantor) of the
Construction Agent or such Credit Party set forth in the Operative
Agreements are true and correct in all material respects on and as of such
Property Closing Date as if made on and as of such date. The Construction
Agent or such Credit Party is in all material respects in compliance with
its respective obligations under the Operative Agreements and there exists
no Default or Event of Default under any of the Operative Agreements which
is continuing and which has not been cured within any cure period expressly
granted under the terms of the applicable Operative Agreement. No Default
or Event of Default will occur under any of the Operative Agreements as a
result of, or after giving effect to, the Advance requested by the
Requisition on such Property Closing Date;
(b) The Properties to be acquired or leased pursuant to a Ground
Lease are being acquired or ground leased at a price that is not in excess
of fair market value or fair market rental value, as the case may be, and
such Properties consist of (i) unimproved Land, or (ii) Land and existing
Improvements thereon which Improvements are either suitable for occupancy
at the time of acquisition or will be renovated and/or modified in
accordance with the terms of this Agreement. Each of the Properties is
located at the location set forth on the applicable Requisition, all of
which are in one of the Approved States;
(c) Upon the acquisition of each Property on such Property Closing
Date, and at all times thereafter, the Lessor will have good and marketable
fee simple title to such Property, or, if such Property is the subject of a
Ground Lease, the Lessor will have a lessee's interest enforceable against
the ground lessor of such Property in accordance with the terms of such
Ground Lease, subject only to Permitted Liens;
(d) The execution and delivery of each Operative Agreement delivered
by the Construction Agent or such Credit Party on such Property Closing
Date and the performance of the obligations of the Construction Agent or
such Credit Party under each Operative Agreement have been duly authorized
by all requisite corporate action of the Construction Agent or such Credit
Party, as applicable;
(e) Each Operative Agreement delivered on such Property Closing Date
by the Construction Agent or such Credit Party has been duly executed and
delivered by the Construction Agent or such Credit Party;
23
(f) Each Operative Agreement delivered by the Construction Agent or
such Credit Party on such Property Closing Date is a legal, valid and
binding obligation of the Construction Agent or such Credit Party,
enforceable against the Construction Agent or such Credit Party, in
accordance with its respective terms, except (i) as may be limited by
bankruptcy, insolvency, receivership, conservatorship, reorganization,
moratorium or similar laws of general applicability affecting the
enforcement of creditors' rights and (ii) such enforceability may be
limited by the application of general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at
law);
(g) No portion of any Property being acquired by the Lessor on such
Property Closing Date is located in an area identified as a special flood
hazard area by the Federal Emergency Management Agency or other applicable
agency, or if any such Property is located in an area identified as a
special flood hazard area by the Federal Emergency Management Agency or
other applicable agency, then flood insurance has been obtained for such
Property in accordance with Section 14.2(b) of the Lease and in accordance
with the National Flood Insurance Act of 1968, as amended;
(h) The Construction Agent has obtained insurance coverage for each
Property being acquired by the Lessor on such Property Closing Date which
meet the requirements of the Lease and all of such coverage is in full
force and effect;
(i) Each Property being acquired by the Lessor on such Property
Closing Date complies with all Legal Requirements (including, without
limitation, all zoning and land use laws and Environmental Laws), except to
the extent that failure to comply therewith would not, individually or in
the aggregate, have a Material Adverse Effect; and
(j) All utility services and facilities necessary for the
construction of the Improvements existing on, or to be constructed after,
such Property Closing Date (including, without limitation, gas, electrical,
water and sewage services and facilities) are available at the boundaries
of the real property upon which such Improvements exist or will be
constructed on each such Property prior to the Completion Date for such
Property.
8.2 Representations and Warranties Upon Initial Construction Advances.
-----------------------------------------------------------------
The Construction Agent and each Credit Party hereby represents and warrants
as to itself as of each date on which an Initial Construction Advance is made as
follows:
(a) The representations and warranties (including the Incorporated
Representations and Warranties in the case of the Guarantor) of the
Construction Agent or such Credit Party set forth in the Operative
Agreements are true and correct in all material respects on and as of the
date of such Initial Construction Advance as if made on and as of such
date. The Construction Agent or such Credit Party is in all material
respects in compliance with its respective obligations under the Operative
Agreements and there exists no Default or Event of Default under any of the
Operative Agreements. No Default or
24
Event of Default will occur under any of the Operative Agreements as a
result of, or after giving effect to, the Advance requested by the
Requisition on such date;
(b) The Lessor has good and marketable fee simple title to each
Property, or, if such Property is the subject of a Ground Lease, the Lessor
has a lessee's interest enforceable against the ground lessor in accordance
with the terms of such Ground Lease, subject only to Permitted Liens;
(c) [Intentionally Omitted]
(d) All consents, licenses, permits, authorizations, assignments and
building permits required as of the date on which such Advance is made by
all material Legal Requirements or pursuant to the terms of any contract,
indenture, instrument or agreement for construction, completion, occupancy,
operation, leasing or subleasing of each Property with respect to which an
Advance is being made have been obtained and are in full force and effect,
except to the extent that the failure to so obtain would not, individually
or in the aggregate, have a Material Adverse Effect;
(e) The Construction Agent has obtained insurance coverage covering
the Property which is the subject of such Advance which meets the
requirements of Section 2.6 of the Agency Agreement before commencing
construction, repairs or modifications, as the case may be, and such
coverage is in full force and effect;
(f) The Improvements which are the subject of the Advance, as
improved in accordance with the Plans and Specifications, will comply as of
the applicable Completion Date with all material Legal Requirements and
Insurance Requirements (including, without limitation, all zoning and land
use laws and Environmental Laws), except to the extent the failure to
comply therewith would not, individually or in the aggregate, have a
Material Adverse Effect. The Plans and Specifications have been or will be
prepared in accordance with all applicable Legal Requirements (including,
without limitation, all applicable Environmental Laws and building,
planning, zoning and fire codes), except to the extent the failure to
comply therewith would not, individually or in the aggregate, have a
Material Adverse Effect, and upon completion of such Improvements in
accordance with the Plans and Specifications, such Improvements will not
encroach in any manner onto any adjoining land (except as permitted by
express written easements) and such Improvements and the use thereof by the
Lessee and its agents, assignees, employees, invitees, lessees, licensees
and tenants will comply as of the applicable Completion Date in all
respects with all applicable Legal Requirements (including, without
limitation, all applicable Environmental Laws and building, planning,
zoning and fire codes), except to the extent the failure to comply
therewith would not, individually or in the aggregate, have a Material
Adverse Effect. Upon completion of such Improvements in accordance with the
Plans and Specifications, (i) there will be no material defects to such
Improvements including, without limitation, the plumbing, heating, air
conditioning and electrical systems thereof and (ii) all water, sewer,
electric, gas, telephone and drainage facilities and all other utilities
required to adequately service such Improvements for their intended use
will be available pursuant to adequate
25
permits (including any that may be required under applicable Environmental
Laws), except to the extent that failure to obtain any such permit would
not, individually or in the aggregate, have a Material Adverse Effect.
There is no action, suit or proceeding (including any proceeding in
condemnation or eminent domain or under any Environmental Law) pending or,
to the best knowledge of the Lessee or the Construction Agent, overtly
threatened which adversely affects the title to, or the use, operation or
value of, such Properties. No fire or other casualty with respect to such
Properties has occurred which fire or other casualty has had a Material
Adverse Effect. All utilities serving the related Properties, or proposed
to serve the related Properties in accordance with the Plans and
Specifications, are located in (and in the future will be located in) and
vehicular access to such Improvements is provided by (or will be provided
by), either public rights-of-way abutting the related Property or
Appurtenant Rights. All licenses, approvals, authorizations, consents,
permits (including, without limitation, building, demolition and
environmental permits, licenses, approvals, authorizations and consents),
easements and rights-of-way, including proof of dedication, required for
(i) the use, treatment, storage, transport, disposal or disposition of any
Hazardous Substance on, at, under or from the real property underlying such
Improvements during the construction of such Improvements and the use and
operation of such Improvements following such construction, (ii) the
construction of such Improvements in accordance with the Plans and
Specifications and the Agency Agreement and (iii) the use and operation of
such Improvements following such construction with the applicable Equipment
which such Improvements support for the purposes for which they were
intended have either been obtained from the appropriate Governmental
Authorities having jurisdiction or from private parties, as the case may
be, or will be obtained from the appropriate Governmental Authorities
having jurisdiction or from private parties, as the case may be, prior to
commencing any such construction or use and operation, as applicable; and
(g) All conditions precedent contained in this Agreement and in the
other Operative Agreements relating to the initial Advance to the
Construction Agent of funds for the purpose of commencing construction,
repairs or modifications on any Property have been substantially satisfied.
8.3 Representations and Warranties Upon the Date of Each Construction
-----------------------------------------------------------------
Advance That Is Not An Initial Advance.
---------------------------------------
The Construction Agent and each Credit Party hereby represents and warrants
as to itself as of each date on which a Construction Advance is made, when such
Advance is not an Initial Construction Advance, as follows:
(a) The representations and warranties of the Construction Agent or
such Credit Party set forth in the Operative Agreements (including the
representations and warranties set forth in Section 8.2 and, in the case of
the Guarantor, the Incorporated Representations and Warranties) are true
and correct in all material respects on and as of the date of such
Construction Advance as if made on and as of such date. The Construction
Agent or such Credit Party is in all material respects in compliance with
its respective obligations
26
under the Operative Agreements and there exists no Default or Event of
Default under any of the Operative Agreements which is continuing and which
has not been cured within any cure period expressly granted under the terms
of the applicable Operative Agreement. No Default or Event of Default will
occur under any of the Operative Agreements as a result of, or after giving
effect to, the Advance requested by the Requisition on such date;
(b) Construction of the Improvements to date has been performed in
a good and workmanlike manner, substantially in accordance with the Plans
and Specifications and in compliance with all Insurance Requirements and
material Legal Requirements, except to the extent noncompliance with any
Legal Requirements would not, individually or in the aggregate, have a
Material Adverse Effect;
(c) All consents, licenses, permits, authorizations, assignments
and building permits required as of the date on which such Advance is made
by all material Legal Requirements or pursuant to the terms of any
contract, indenture, instrument or agreement for construction, completion,
occupancy, operation, leasing or subleasing of each Property have been
obtained and are in full force and effect except to the extent the failure
to so obtain would not, individually or in the aggregate, have a Material
Adverse Effect;
(d) When completed, the Improvements shall be wholly within any
building restriction lines (unless consented to by applicable Government
Authorities), however established; and
(i) Assuming that the applicable UCC Financing Statements and
Mortgage Instruments have been filed in the filing offices designated by
the Lessee or the Construction Agent, the Advance is secured by the Liens
of the Security Agreement and such Mortgage Instruments, and (ii) there
have been no Liens against the applicable Improvements since the filing of
the Lender Financing Statements and such Mortgage Instruments other than
Permitted Liens.
The Construction Agent and each Credit Party further acknowledges that upon
the acceptance and use of the funds by the Construction Agent or the Lessee, as
the case may be, on behalf of the Lessor that all such representations and
warranties remain true and correct on the date of such Advance and that all
consents and approvals have been obtained prior to the date of such Advance.
SECTION 8B. GUARANTY
8B.1. Guaranty of Payment and Performance.
-----------------------------------
Subject to Section 8B.7, the Guarantor hereby unconditionally and
irrevocably guarantees to each Financing Party the prompt payment and
performance of the Company Obligations in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration or otherwise) or when such
is otherwise to be performed; provided, notwithstanding the foregoing, the
--------
obligations of the Guarantor under this Section 8B shall not constitute a direct
guaranty of the indebtedness of
27
the Lessor evidenced by the Notes but rather a guaranty of the Company
Obligations arising under the Operative Agreements. This Section 8B is a
guaranty of payment and performance and not of collection and is a continuing
guaranty and shall apply to all Company Obligations whenever arising. The
exercise of any rights granted to the Financing Parties under this Section 8B
shall be in accordance with the provisions of Section 10.2(j) and 10.6.
8B.2. Obligations Unconditional.
-------------------------
The Guarantor agrees that the obligations of the Guarantor hereunder are
irrevocable, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Operative Agreements, or
any other agreement or instrument referred to therein, or any substitution,
release or exchange of any other guarantee of or security for any of the Company
Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety, guarantor or
co-obligor, it being the intent of this Section 8B.2 that the obligations of the
Guarantor hereunder shall be absolute and unconditional under any and all
circumstances. The Guarantor agrees that this Section 8B may be enforced by the
Financing Parties without the necessity at any time of resorting to or
exhausting any other security or collateral and without the necessity at any
time of having recourse to the Notes, the Certificates or any other of the
Operative Agreements or any collateral, if any, hereafter securing the Company
Obligations or otherwise and the Guarantor hereby waives the right to require
the Financing Parties to proceed against the Construction Agent, the Lessee or
any other Person (including without limitation a co-guarantor) or to require the
Financing Parties to pursue any other remedy or enforce any other right. The
Guarantor further agrees that it hereby waives any and all right of subrogation,
indemnity, reimbursement or contribution against the Lessee and the Construction
Agent or any other guarantor of the Company Obligations for amounts paid under
this Section 8B until such time as the Loans, Holder Fundings, accrued but
unpaid interest, accrued but unpaid Holder Yield and all other amounts owing
under the Operative Agreements have been paid in full. Without limiting the
generality of the waiver provisions of this Section 8B, the Guarantor hereby
waives any rights to require the Financing Parties to proceed against the
Construction Agent, the Lessee or any co-guarantor or to require Lessor to
pursue any other remedy or enforce any other right, including without
limitation, any and all rights under N.C. Gen. Stat. (S) 26-7 through 26-9. The
Guarantor further agrees that nothing contained herein shall prevent the
Financing Parties from suing on any Operative Agreement or foreclosing any
security interest in or Lien on any collateral, if any, securing the Company
Obligations or from exercising any other rights available to it under any
Operative Agreement, or any other instrument of security, if any, and the
exercise of any of the aforesaid rights and the completion of any foreclosure
proceedings shall not constitute a discharge of the Guarantor's obligations
hereunder; it being the purpose and intent of the Guarantor that its obligations
hereunder shall be absolute, independent and unconditional under any and all
circumstances; provided that any amounts due under this Section 8B which are
--------
paid to or for the benefit of any Financing Party shall reduce the Company
Obligations by a corresponding amount (unless required to be rescinded at a
later date). Neither any Guarantor's obligations under this Section 8B nor any
remedy for the enforcement thereof shall be impaired, modified, changed or
released in any manner whatsoever by an impairment, modification, change,
release or limitation of the liability of the Construction Agent or the Lessee
or by reason of the bankruptcy or insolvency of
28
the Construction Agent or the Lessee. The Guarantor waives any and all notice of
the creation, renewal, extension or accrual of any of the Company Obligations
and notice of or proof of reliance by any Financing Party upon this Section 8B
or acceptance of this Section 8B. The Company Obligations shall conclusively be
deemed to have been created, contracted or incurred, or renewed, extended,
amended or waived, in reliance upon this Section 8B. All dealings between the
Construction Agent, the Lessee and the Guarantor, on the one hand, and the
Financing Parties, on the other hand, likewise shall be conclusively presumed to
have been had or consummated in reliance upon this Section 8B.
8B.3. Modifications.
-------------
The Guarantor agrees that (a) all or any part of the security now or
hereafter held for the Company Obligations, if any, may be exchanged,
compromised or surrendered from time to time; (b) no Financing Party shall have
any obligation to protect, perfect, secure or insure any such security
interests, liens or encumbrances now or hereafter held, if any, for the Company
Obligations or the properties subject thereto; (c) the time or place of payment
of the Company Obligations may be changed or extended, in whole or in part, to a
time certain or otherwise, and may be renewed or accelerated, in whole or in
part; (d) the Construction Agent, the Lessee and any other party liable for
payment under the Operative Agreements may be granted indulgences generally; (e)
any of the provisions of the Notes, the Certificates or any of the other
Operative Agreements may be modified, amended or waived; (f) any party
(including any co-guarantor) liable for the payment thereof may be granted
indulgences or be released; and (g) any deposit balance for the credit of the
Construction Agent, the Lessee or any other party liable for the payment of the
Company Obligations or liable upon any security therefor may be released, in
whole or in part, at, before or after the stated, extended or accelerated
maturity of the Company Obligations, all without notice to or further assent by
the Guarantor, which shall remain bound thereon, notwithstanding any such
exchange, compromise, surrender, extension, renewal, acceleration, modification,
indulgence or release.
8B.4. Waiver of Rights.
----------------
The Guarantor expressly waives to the fullest extent permitted by
applicable law: (a) notice of acceptance of this Section 8B by any Financing
Party and of all extensions of credit or other Advances to the Construction
Agent and the Lessee by the Lenders pursuant to the terms of the Operative
Agreements; (b) presentment and demand for payment or performance of any of the
Company Obligations; (c) protest and notice of dishonor or of default with
respect to the Company Obligations or with respect to any security therefor; (d)
notice of any Financing Party obtaining, amending, substituting for, releasing,
waiving or modifying any security interest, lien or encumbrance, if any,
hereafter securing the Company Obligations, or any Financing Party's
subordinating, compromising, discharging or releasing such security interests,
liens or encumbrances, if any; and (e) all other notices to which the Guarantor
might otherwise be entitled. Notwithstanding anything to the contrary herein,
the Guarantor's payments hereunder shall be due five (5) Business Days after
written demand by the Agent to the Lessee or the Guarantor for such payment
(unless the Company Obligations are automatically accelerated pursuant to the
applicable
29
provisions of the Operative Agreements or are deemed accelerated as provided in
Section 8B.6 in which case the Guarantor's payments shall be automatically due).
8B.5. Reinstatement.
-------------
The obligations of the Guarantor under this Section 8B shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Company Obligations is rescinded or
must be otherwise restored by any holder of any of the Company Obligations,
whether as a result of any proceedings in bankruptcy or reorganization or
otherwise, and the Guarantor agrees that it will indemnify each Financing Party
on demand for all reasonable costs and expenses (including, without limitation,
reasonable fees of counsel) incurred by any Financing Party in connection with
such rescission or restoration, including without limitation any such costs and
expenses incurred in defending against any claim alleging that such payment
constituted a preference, fraudulent transfer or similar payment under any
bankruptcy, insolvency or similar law.
8B.6. Remedies.
--------
The Guarantor agrees that, as between the Guarantor, on the one hand, and
each Financing Party, on the other hand, the Company Obligations may be declared
to be forthwith due and payable as provided in the applicable provisions of the
Operative Agreements (and shall be deemed to have become automatically due and
payable on an Event of Default specified in Section 17.1(h), (i) or (j) of the
Lease) notwithstanding any stay, injunction or other prohibition preventing such
declaration (or preventing such Company Obligations from becoming automatically
due and payable) as against any other Person and that, in the event of such
declaration (or such Company Obligations being deemed to have become
automatically due and payable), such Company Obligations (whether or not due and
payable by any other Person) shall forthwith become due and payable by the
Guarantor in accordance with the applicable provisions of the Operative
Agreements.
8B.7. Termination of Guaranty.
-----------------------
Subject to Section 8B.5, upon the satisfaction of the Company Obligations
in full, regardless of the source of payment, the Guarantor's obligations
hereunder shall be deemed satisfied, discharged and terminated other than
indemnifications set forth herein that expressly survive.
8B.8. Payment of Amounts to the Agent.
-------------------------------
Each Financing Party hereby instructs the Guarantor, and the Guarantor
hereby acknowledges and agrees, that until such time as the Loans and the Holder
Fundings are paid in full and the Liens evidenced by the Security Agreement and
the Mortgage Instruments have been released any and all Rent (excluding Excepted
Payments which shall be payable to each Holder or other Person as appropriate)
and any and all other amounts of any kind or type under any of the Operative
Agreements due and owing or payable to any Person shall instead be paid directly
30
to the Agent (excluding Excepted Payments which shall be payable to each Holder
or other Person as appropriate) or as the Agent may direct from time to time for
allocation and distribution in accordance with the procedures set forth in
Section 10.4 hereof and Section 8 of the Credit Agreement.
8B.9. Denial Or Disaffirmance Of Guaranty.
-----------------------------------
Notwithstanding any provision to the contrary contained herein or in any
other Operative Agreement, the parties hereto agree that, unless released in
connection with the Operative Agreements, if the guaranty given by the Guarantor
under Section 8B of the Participation Agreement or any material provision
thereof shall cease to be in full force or effect, or the Guarantor or any
Person acting on behalf of the Guarantor shall deny or disaffirm the Guarantor's
obligations under such guaranty, then the Guarantor shall automatically, without
notice and without any further act, be deemed to be an additional construction
agent (or a co-construction agent) and/or an additional lessee (or co-lessee)
under the Operative Agreements with the Construction Agent and/or the Lessee, as
the case may be, and shall be jointly and severally liable with the Construction
Agent and/or the Lessee for the payment and performance of any obligations of
the Construction Agent and/or the Lessee under the Operative Agreements as
though the Guarantor was originally a party to such Operative Agreements in such
capacity or capacities.
SECTION 9 PAYMENT OF CERTAIN EXPENSES.
9.1 Transaction Expenses.
--------------------
(a) Lessor agrees on the Initial Closing Date, to pay, or cause to be
paid, all reasonable fees, expenses and disbursements of the various legal
counsels for the Lessor, the Lessee and the Agent in connection with the
transactions contemplated by the Operative Agreements and incurred in
connection with such Initial Closing Date, including all Transaction
Expenses (arising from the Initial Closing Date), and all other reasonable
fees, expenses and disbursements in connection with such Initial Closing
Date, including, without limitation, all fees, taxes and expenses for the
recording, registration and filing of documents; provided, however, the
Lessor shall pay such amounts described in this Section 9.1(a) only if
funds are made available by the Lenders and the Holders in an amount
sufficient to allow such payment and without regard to whether such amounts
are referenced in any Requisition; provided, the failure of such amounts so
--------
funded to be referenced in a Requisition shall not preclude the Lessee from
later contesting the reasonableness of the payment of such amounts. On the
Initial Closing Date after satisfaction of the conditions precedent for
such date (excluding the requirement that a Requisition be delivered), the
Holders shall make Holder Fundings and the Lenders shall make Loans to the
Lessor to pay for the Transaction Expenses, fees, expenses and other
disbursements referenced in this Section 9.1(a).
(b) Lessor agrees on each Property Closing Date, on the date of any
Construction Advance and on the Completion Date to pay, or cause to be
paid, all
31
reasonable fees, expenses and disbursements of the various legal counsels
for the Lessor, the Lessee and the Agent in connection with the
transactions contemplated by the Operative Agreements and billed in
connection with such Advance or such Completion Date including all
Transaction Expenses, all fees, expenses and disbursements incurred with
respect to the various items referenced in Sections 5.3, 5.4, 5.5 and/or
5.6 (including without limitation any premiums for title insurance policies
and charges for any updates to such policies) and all other reasonable
fees, expenses and disbursements in connection with such Advance or such
Completion Date including, without limitation, all expenses relating to and
all fees, taxes and expenses for the recording, registration and filing of
documents; provided, however, the Lessor shall pay such amounts described
in this Section 9.1(b) only if funds are made available by the Lenders and
the Holders in an amount sufficient to allow such payment and without
regard to whether such amounts are referenced in any Requisition; provided,
--------
the failure of such amounts so funded to be referenced in a Requisition
shall not preclude the Lessee from later contesting the reasonableness of
the payment of such amounts. On each Property Closing Date, on the date of
any Construction Advance or any Completion Date, after satisfaction of the
conditions precedent for such date (excluding the requirement that a
Requisition be delivered), the Holders shall make a Holder Funding and the
Lenders shall make Loans to the Lessor to pay for the Transaction Expenses,
fees, expenses and other disbursements referenced in this Section 9.1(b).
9.2 [Reserved].
--------
9.3 Certain Fees And Expenses.
-------------------------
Lessor agrees to pay or cause to be paid (i) the initial and annual Owner
Trustee's fee and all reasonable expenses of the Owner Trustee and any necessary
co-trustees (including without limitation reasonable counsel fees and expenses)
or any successor owner trustee, for acting as owner trustee under the Trust
Agreement and (ii) all reasonable costs and expenses incurred by the Credit
Parties, the Construction Agent, the Agent, the Lenders, the Holders or the
Lessor in entering into any Lease Supplement and any future amendments or
supplements with respect to any of the Operative Agreements, whether or not such
Lease Supplement, amendments or supplements are ultimately entered into, or
giving or withholding of waivers of consents hereto or thereto, which have been
requested by the Lessor, the Holders, any Credit Party, the Construction Agent,
or the Agent; provided, however, the Lessor shall pay such amounts described in
-------- -------
this Section 9.3 only if funds are made available by the Lenders and the Holders
in an amount sufficient to allow such payment and without regard to whether such
amounts are referenced in any Requisition. Notwithstanding the foregoing, the
Lessee agrees to pay or cause to be paid any amounts referenced in the
immediately preceding sentence to the extent such amounts are due and payable
after the Construction Period Termination Date. The Lessee agrees to pay or
cause to be paid (i) all reasonable costs and expenses incurred by the Lessor,
the Holders, the Lenders or the Agent in connection with any exercise of
remedies under any Operative Agreement or any purchase of any Property by the
Lessee pursuant to Article XX of the Lease and (ii) all reasonable costs and
expenses incurred by the Credit Parties, the Construction Agent, the Agent, the
Lenders, the Holders or the Lessor in connection with any transfer or conveyance
of any Property, whether or not such transfer or conveyance is ultimately
accomplished.
32
9.4 Facility Fee.
------------
The Lessor agrees to pay to the Agent for the account of the Lenders and
the Holders a facility fee (the "Facility Fee") computed at a rate per annum
equal to Applicable Percentage for the Facility Fee multiplied times the sum of
(x) the aggregate Commitments (whether used or unused) and (y) the aggregate
Holder Commitments (whether used or unused); provided, however, the Lessor shall
-------- -------
pay such amounts described in this Section 9.4 only if funds are made available
by the Lenders and the Holders in an amount sufficient to allow such payment and
without regard to whether such amounts are referenced in any Requisition.
Notwithstanding the foregoing, the Lessee agrees to pay or cause to be paid any
amounts referenced in the immediately preceding sentence to the extent such
amounts are due and payable or are outstanding after the earlier of the last
Completion Date for all Properties or the Construction Period Termination Date.
Such Facility Fee shall be calculated on the basis of 360-day year from the
actual days elapsed and shall be payable quarterly in arrears on each Facility
Fee Payment Date. If all or a portion of any such Facility Fee shall not be paid
when due, such overdue amount shall bear interest, payable on demand, at a rate
per annum equal to the ABR plus three percent (3%) from the date of such non-
payment until such amount is paid in full (after as well as before judgment).
SECTION 10 OTHER COVENANTS AND AGREEMENTS.
10.1 Cooperation With The Construction Agent Or The Lessee.
-----------------------------------------------------
The Holders, the Lessor (at the direction of the Holders) and the Agent
shall, to the extent reasonably requested by the Construction Agent or Lessee
(but without assuming additional liabilities on account thereof), cooperate with
the Construction Agent or the Lessee in connection with its covenants contained
herein including, without limitation, at any time and from time to time, upon
the request of the Construction Agent or the Lessee to promptly and duly execute
and deliver any and all such further instruments, documents and financing
statements (and continuation statements related thereto) as the Construction
Agent or the Lessee may reasonably request in order to perform such covenants.
10.2 Covenants Of The Owner Trustee And The Holders.
----------------------------------------------
Each of the Owner Trustee and the Holders hereby agree that so long as this
Agreement is in effect:
(a) The Owner Trustee (both in its trust capacity and in its
individual capacity) will not create or permit to exist at any time, and
will, at its own cost and expense, promptly take such action as may be
necessary duly to discharge, or to cause to be discharged, all Lessor Liens
on the Properties attributable to it; provided, however, that the Owner
Trustee shall not be required to so discharge any such Lessor Lien while
the same is being contested in good faith by appropriate proceedings
diligently prosecuted so long as such proceedings shall not involve any
material danger of impairment of the Liens of the Security Documents
33
or of the sale, forfeiture or loss of, and shall not interfere with the use
or disposition of, any Property or title thereto or any interest therein or
the payment of Rent;
(b) Without prejudice to any right under the Trust Agreement of the
Owner Trustee to resign (subject to the requirement set forth in the Trust
Agreement that such resignation shall not be effective until a successor
shall have agreed to accept such appointment), or the Holders' rights under
the Trust Agreement to remove the institution acting as Owner Trustee
(after consent to such removal by the Agent as provided in the Trust
Agreement), each of the Holders and the Owner Trustee hereby agrees with
the Lessee and the Agent (i) not to terminate or revoke the trust created
by the Trust Agreement except as permitted by Article VIII of the Trust
Agreement, (ii) not to amend, supplement, terminate or revoke or otherwise
modify any provision of the Trust Agreement in such a manner as to
adversely affect the rights of any such party without the prior written
consent of such party and (iii) to comply with all of the terms of the
Trust Agreement, the nonperformance of which would adversely affect such
party;
(c) The Owner Trustee or any successor may resign or be removed by
the Holders as Owner Trustee, a successor Owner Trustee may be appointed
and a corporation may become the Owner Trustee under the Trust Agreement,
only in accordance with the provisions of Article IX of the Trust Agreement
and, with respect to such appointment, with the consent of the Lessee,
which consent shall not be unreasonably withheld or delayed;
(d) The Owner Trustee, in its capacity as Owner Trustee under the
Trust Agreement, and not in its individual capacity, shall not contract
for, create, incur or assume any indebtedness, or enter into any business
or other activity, other than pursuant to or under the Operative
Agreements;
(e) The Holders will not instruct the Owner Trustee to take any
action in violation of the terms of any Operative Agreement;
(f) Neither any Holder nor the Owner Trustee shall (i) commence any
case, proceeding or other action with respect to the Owner Trustee under
any existing or future law of any jurisdiction, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, arrangement, winding-
up, liquidation, dissolution, composition or other relief with respect to
it or its debts, or (ii) seek appointment of a receiver, trustee, custodian
or other similar official with respect to the Owner Trustee or for all or
any substantial benefit of the creditors of the Owner Trustee; and neither
any Holder nor the Owner Trustee shall take any action in furtherance of,
or indicating its consent to, approval of, or acquiescence in, any of the
acts set forth in this paragraph;
(g) The Owner Trustee shall give prompt notice to the Lessee and the
Agent if the Owner Trustee's chief place of business or chief executive
office, or the office where the records concerning the accounts or contract
rights relating to the Property are kept, shall cease to be located at ▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, or if it shall change its
name;
34
(h) Provided that no Lease Default or Lease Event of Default has
occurred and is continuing, the Owner Trustee shall not, without the prior
written consent of the Lessee and the Guarantor, consent to or permit any
amendment, supplement or other modification of the terms and provisions of
the Credit Agreement or the Notes;
(i) The Owner Trustee shall not consent to or permit any amendment,
supplement or other modification of the terms and provisions of any
Operative Agreement, without the prior written consent of the Agent and, so
long as no Default or Event of Default shall have occurred and be
continuing and, in the case of any amendment, supplement or other
modification of Section 8.1 of the Credit Agreement, so long as Lessee
continues to have rights in any Property, the Lessee (such consent not to
be unreasonably withheld or delayed) except as described in Section 10.5 of
this Agreement; and
(j) The Owner Trustee (i) shall take such actions and shall refrain
from taking such actions with respect to the Operative Agreements and/or
relating to the Properties and shall grant such approvals and otherwise act
or refrain from acting with respect to the Operative Agreements and/or
relating to the Properties in each case as directed in writing by the Agent
or, in connection with Section 10.5 hereof, the Lessee, notwithstanding any
contrary instruction or absence of instruction by any Holder or Holders;
and (ii) shall not take any action, grant any approvals or otherwise act
under or with respect to the Operative Agreements and/or any matters
relating to the Properties without first obtaining the prior written
consent of the Agent (and without regard to any contrary instruction or
absence of instruction by any Holder); provided, however, that
notwithstanding the foregoing provisions of this subparagraph (j) the Owner
Trustee, the Agent and the Holders each acknowledge, covenant and agree
that, with respect to all matters under the Operative Agreements that
require the consent and/or concurrence of all of the Lenders pursuant to
the terms of Section 9.1 of the Credit Agreement (the "Unanimous Vote
Matters"), neither the Owner Trustee nor the Agent shall act or refrain
from acting with respect to any Unanimous Vote Matter until such party has
received the approval of each Lender and each Holder with respect thereto.
10.3 Credit Party Covenants, Consent And Acknowledgment.
--------------------------------------------------
(a) Each Credit Party acknowledges and agrees that the Owner Trustee,
pursuant to the terms and conditions of the Security Agreement and the
Mortgage Instruments, shall create Liens respecting the various personal
property, fixtures and real property described therein in favor of the
Agent. Each Credit Party hereby irrevocably consents to the creation,
perfection and maintenance of such Liens. Each Credit Party shall, to the
extent reasonably requested by any of the other parties hereto, cooperate
with the other parties in connection with their covenants herein or in the
other Operative Agreements and shall from time to time duly execute and
deliver any and all such future instruments, documents and financing
statements (and continuation statements related thereto) as any other party
hereto may reasonably request.
35
(b) Lessor hereby instructs each Credit Party, and each Credit Party
hereby acknowledges and agrees, that until such time as the Loans are paid
in full and the Liens evidenced by the Security Agreement and the Mortgage
Instruments have been released (i) any and all Rent and any and all other
amounts of any kind or type under any of the Operative Agreements due and
owing or payable to the Lessor or the Owner Trustee shall instead be paid
directly to the Agent or as the Agent may direct from time to time and (ii)
each Credit Party shall cause all notices, certificates, financial
statements, communications and other information which is delivered, or is
required to be delivered, to the Lessor, to also to be delivered at the
same time to the Agent and each Holder.
(c) No Credit Party shall consent to or permit any amendment,
supplement or other modification of the terms or provisions of any
Operative Agreement without, in each case, obtaining the prior written
consent of the Agent and, to the extent required by the proviso at the end
of Section 10.2(j) hereof, each of the Holders. The Lessee acknowledges
that the actions of the Owner Trustee are subject to the consent of the
Agent as set forth in Section 10.2(j).
(d) [Intentionally Omitted]
(e) Each Credit Party hereby covenants and agrees that, except for
amounts payable as Basic Rent and as otherwise expressly specified in the
Operative Agreements, any and all payment obligations owing from time to
time under the Operative Agreements to the Agent, any Lender or any Holder
shall (without further action) be deemed to be Supplemental Rent
obligations payable by Lessee and guaranteed by the Guarantor. Without
limitation, such obligations shall include commitment fees, unused fees,
prepayment penalties, indemnities, trustee fees and transaction expenses
incurred by the parties hereto in connection with the transactions
contemplated by the Operative Agreements.
(f) Consistent with the terms and conditions of the Security
Agreement, each of the Construction Agent and Lessee hereby covenants and
agrees, at its own cost and expense, to assemble and make available to the
Agent (on behalf of Lessor) any and all personal property components of any
and all Properties.
10.4 Sharing Of Certain Payments.
---------------------------
The parties hereto acknowledge and agree that all payments due and owing by
any Credit Party to the Lessor under the Lease or any of the other Operative
Agreements shall be made by such Credit Party directly to the Agent as more
particularly provided in Section 10.3 hereof. The Holders and the Agent, on
behalf of the Lenders, acknowledge the terms of Section 8 of the Credit
Agreement regarding the allocation of payments and other amounts made or
received from time to time under the Operative Agreements and agree, that all
such payments and amounts are to be allocated as provided in Section 8 of the
Credit Agreement. In connection therewith the Holders hereby (a) appoint the
Agent to act as collateral agent for the Holders in connection with the Lien
granted by the Security Documents to secure the Holder Amount and (b)
acknowledge and agree
36
and direct that the rights and remedies of the beneficiaries of the Lien of the
Security Documents shall be exercised by the Agent on behalf of the Lenders and
the Holders as directed from time to time by the Lenders without notice to or
consent from the Holders.
10.5 Grant Of Easements, Etc.
------------------------
The Agent and the Holders hereby agree that, so long as no Event of Default
shall have occurred and be continuing, and until such time as the Agent gives
instructions to the contrary to the Owner Trustee, the Owner Trustee shall, from
time to time at the request of the Lessee, in connection with the transactions
contemplated by the Agency Agreement, the Lease or the other Operative
Agreements, (i) grant easements and other rights in the nature of easements with
respect to any Property, (ii) release existing easements or other rights in the
nature of easements which are for the benefit of any Property, (iii) execute and
deliver to any Person any instrument appropriate to confirm or effect such
grants or releases, and (iv) execute and deliver to any Person such other
documents or materials in connection with the acquisition, development or
operation of any Property, including, without limitation, reciprocal easement
agreements, operating agreements, development agreements, plats, replats or
subdivision documents; provided, that each of the agreements referred to in this
--------
Section 10.5 shall be of the type normally executed by the Lessee in the
ordinary course of the Lessee's business and shall be on commercially reasonable
terms so as not to diminish the value of any Property in any material respect.
10.6 Appointment By Holders And Owner Trustee.
----------------------------------------
Except as expressly provided in any Operative Agreement where the Owner
Trustee is required to act for or on behalf of the Holders, each Holder hereby
designates and appoints the Agent as the Agent of such Holder under this
Agreement and the other Operative Agreements, to take such action on behalf of
such Holder under the provisions of this Agreement and the other Operative
Agreements and exercise such powers and perform such duties as are expressly
delegated to the Agent by the terms of this Agreement (including, without
limitation, provisions of other agreements incorporated herein by reference) and
other Operative Agreements with respect to the Lenders and as specifically
delegated to the Owner Trustee on behalf of such Holder in any Operative
Agreement. For purposes hereof, and except as expressly provided herein to the
contrary, the provisions of Section 7 of the Credit Agreement, together with
such other terms and provisions of the Credit Agreement and the other Operative
Agreements as required for the full interpretation and operation of Section 7 of
the Credit Agreement are hereby incorporated by reference as if restated herein
for the mutual benefit of the Agent and each Holder as if such Holder were a
Lender thereunder. Except as may be expressly provided to the contrary, for
purposes hereof, outstanding Holder Fundings shall be taken into account and
treated as Loans for purposes of determining Majority Lenders; provided,
however, in any case, under the Operative Agreements where the consent of the
Holder is expressly required or the Holder is entitled to take any action, such
consent shall be given or action taken, whether directly by the Holder or by the
Agent (without the requirement that the consent of any Lender be obtained or
permission for such action be granted by any Lender); and, provided, further, no
amendment to any provision expressly requiring the consent of the Holder or
permitting the Holder to take action (whether directly or through the Agent),
shall be
37
effective without the written consent of the Holder. Further, the Agent shall be
entitled to take such action on behalf of the Owner Trustee as is delegated to
the Agent under any Operative Agreement (whether express or implied) as may be
reasonably incidental thereto. Each Lender hereby agrees to the provisions
contained in this Section 10.6.
SECTION 11 CREDIT AGREEMENT AND TRUST AGREEMENT.
11.1 Construction Agent's And Lessee's Credit Agreement Rights.
---------------------------------------------------------
Notwithstanding anything to the contrary contained in the Credit Agreement,
the Agent, the Lenders, the Holders, the Credit Parties and the Owner Trustee
hereby agree that, prior to the occurrence and continuation of any Default or
Event of Default, the Construction Agent and the Lessee (as designated below)
shall have the following rights:
(a) [Intentionally Omitted];
(b) the Construction Agent shall have the right to give the notice
referred to in Section 2.3 of the Credit Agreement and to designate the
account to which a borrowing under the Credit Agreement is to be credited
pursuant to Section 2.3 of the Credit Agreement;
(c) the Lessee shall have the right to terminate or reduce the
Commitments pursuant to Section 2.5(a) of the Credit Agreement;
(d) the Lessee shall have the right to exercise the conversion and
continuation options pursuant to Section 2.7 of the Credit Agreement;
(e) the Lessee shall have the right to replace any Lender pursuant to
Section 2.14(b) of the Credit Agreement;
(f) the Lessee shall have the right to approve any successor agent
pursuant to Section 7.9 of the Credit Agreement;
(g) the Lessee shall have the right to consent to any assignment by a
Lender to which the Lessor has the right to consent pursuant to Section 9.8
of the Credit Agreement;
(h) without limiting the foregoing clauses (a) through (g), and in
addition thereto, provided that no Event of Default then exists, the Lessee
shall have the right to exercise any other right of the Owner Trustee under
the Credit Agreement upon not less than five (5) Business Days' prior
written notice from the Lessee to the Owner Trustee and the Agent;
(i) [Reserved]; and
(j) the Lessee shall have the right to give the notice respecting any
prepayment of any Loan, as provided in Section 2.6(a) of the Credit
Agreement.
38
11.2 Construction Agent's And Lessee's Trust Agreement Rights.
--------------------------------------------------------
Notwithstanding anything to the contrary contained in the Trust Agreement,
the Credit Parties, the Owner Trustee and the Holders hereby agree that neither
the Construction Agent nor any Credit Party controls the Lessor and, prior to
the occurrence and continuation of any Lease Default or Lease Event of Default,
the Construction Agent and the Lessee (as designated below) shall have the
following rights:
(a) [Intentionally Omitted];
(b) the Lessee shall have the right to exercise the conversion and
continuation options pursuant to Section 3.8 of the Trust Agreement;
(c) no removal of the Owner Trustee and appointment of a successor
Owner Trustee pursuant to Section 9.1 of the Trust Agreement shall be made
without the prior written consent (not to be unreasonably withheld or
delayed) of the Lessee;
(d) [Reserved]; and
(e) the Lessee shall have the right to give the notice respecting
any prepayment of any amount under any Certificate, as provided in Section
3.4(a) of the Trust Agreement.
SECTION 12 TRANSFER OF INTEREST.
12.1 Restrictions On Transfer.
------------------------
Each Lender may assign or transfer all or a portion of its interest
hereunder and under the other Operative Agreements in accordance with Section
9.8 of the Credit Agreement; provided, (i) each assignee or transferee with
--------
respect to Tranche A Loans and Tranche A Commitments must obtain the same
ratable interest in Tranche A Loans and Tranche A Commitments as defined in the
▇▇▇▇ Participation Agreement, and (ii) each assignee or transferee with respect
to Tranche B Loans and Tranche B Commitments must obtain the same ratable
interest in Tranche B Loans and Tranche B Commitments as defined in the ▇▇▇▇
Participation Agreement. The Holders may, directly or indirectly, assign, convey
or otherwise transfer any of their right, title or interest in or to the ▇▇▇▇
Trust Estate (together with the same ratable interest in the ▇▇▇▇ Trust Estate)
or the Trust Agreement with the prior written consent of the Agent and, so long
as no Lease Default or Lease Event of Default shall have occurred and be
continuing and the Lessee has rights in one or more of the Properties under the
Lease, the Lessee (which consent shall not be unreasonably withheld or delayed).
The Owner Trustee may, subject to the Lien of the applicable Security Documents
but only with the prior written consent of the Agent, the Holders (which consent
may be withheld by the Agent and/or the Holders in their sole discretion) and
(provided no Default or Event of Default has occurred and is continuing) with
the consent of the Lessee, directly or indirectly, assign, convey, appoint an
agent with respect to enforcement of, or otherwise transfer any of its right,
title or interest in or to any Property, the Lease, the Trust Agreement, this
39
Agreement (including, without limitation, any right to indemnification
thereunder), or any other document relating to a Property or any interest in a
Property as provided in the Trust Agreement and the Lease. The provisions of the
immediately preceding sentence shall not apply to the obligations of the Owner
Trustee to transfer Property to the Lessee or a third party purchaser pursuant
to Article XXII of the Lease upon payment for such Property in accordance with
the terms and conditions of the Lease.
12.2 Effect Of Transfer.
------------------
From and after any transfer effected in accordance with this Section 12,
the transferor shall be released, to the extent of such transfer, from its
liability hereunder and under the other documents to which it is a party in
respect of obligations to be performed on or after the date of such transfer;
provided, however, that any transferor Holder shall remain liable under Article
XI of the Trust Agreement to the extent that the transferee Holder shall not
have assumed the obligations of the transferor Holder thereunder. Upon any
transfer by the Owner Trustee, a Holder or a Lender as above provided, any such
transferee shall assume the obligations of the Owner Trustee, the Lessor, the
Holder or the Lender, as the case may be, and shall be deemed an "Owner
Trustee", "Lessor", "Holder", or "Lender", as the case may be, for all purposes
of such documents and each reference herein to the transferor shall thereafter
be deemed a reference to such transferee for all purposes, except as provided in
the preceding sentence. Notwithstanding any transfer of all or a portion of the
transferor's interest as provided in this Section 12, the transferor shall be
entitled to all benefits accrued and all rights vested prior to such transfer
including, without limitation, rights to indemnification under any such
document.
SECTION 13 INDEMNIFICATION.
13.1 General Indemnity.
-----------------
Subject to and limited by in all respects the provisions of Sections 13.5
and 13.6 and whether or not any of the transactions contemplated hereby shall be
consummated, the Indemnity Provider hereby assumes liability for and agrees to
defend, indemnify and hold harmless each Indemnified Person on an After Tax
Basis from and against any Claims, which may be imposed on, incurred by or
asserted against an Indemnified Person (by any third party, including Claims
arising from the negligence of an Indemnified Person (but not to the extent such
Claims arise from the gross negligence, willful misconduct or willful breach of
such Indemnified Person or are otherwise solely attributable to acts or events
occurring after the expiration of the Lease or after the transfer of all of the
Properties to the Lessee or a third party)) in any way relating to or arising or
alleged to arise out of the execution, delivery, performance or enforcement of
this Agreement, the Lease or any other Operative Agreement or on or with respect
to any Property or any component thereof, including, without limitation, Claims
in any way relating to or arising or alleged to arise out of (a) the financing,
refinancing, purchase, acceptance, rejection, ownership, design, construction,
refurbishment, development, delivery, acceptance, nondelivery, leasing,
subleasing, possession, use, operation, maintenance repair, modification,
transportation, condition, sale, return, repossession (whether by summary
proceedings or otherwise), or any other disposition of any Property or any part
thereof, including the acquisition, holding or disposition of any interest in
the
40
Property, lease or agreement comprising a portion of any thereof; (b) any latent
or other defects in any Property or any portion thereof whether or not
discoverable by an Indemnified Person or the Indemnity Provider; (c) a violation
of Environmental Laws, Environmental Claims or other loss of or damage to any
property or the environment relating to the Property, the Lease, the Agency
Agreement or the Indemnity Provider; (d) the Operative Agreements, or any
transaction contemplated thereby; (e) any breach by the Indemnity Provider of
any of its representations or warranties under the Operative Agreements to which
the Indemnity Provider is a party or failure by the Indemnity Provider to
perform or observe any covenant or agreement to be performed by it under any of
the Operative Agreement; (f) the transactions contemplated hereby or by any
other Operative Agreement, in respect of the application of Parts 4 and 5 of
Subtitle B of Title I of ERISA; and (g) personal injury, death or property
damage, including Claims based on strict or absolute liability in tort.
If a written Claim is made against any Indemnified Person or if any
proceeding shall be commenced against such Indemnified Person (including a
written notice of such proceeding), for any Claim, such Indemnified Person shall
promptly notify the Indemnity Provider in writing and shall not take action with
respect to such Claim without the consent of the Indemnity Provider for thirty
(30) days after the receipt of such notice by the Indemnity Provider; provided,
however, that, in the case of any such Claim, if action shall be required by law
or regulation to be taken prior to the end of such 30-day period, such
Indemnified Person shall endeavor to, in such notice to the Indemnity Provider,
inform the Indemnity Provider of such shorter period, and no action shall be
taken with respect to such Claim without the consent of the Indemnity Provider
before 7 days before the end of such shorter period; provided, further, that the
failure of such Indemnified Person to give the notices referred to in this
sentence shall not diminish the Indemnity Provider's obligation hereunder except
to the extent such failure precludes the Indemnity Provider from contesting such
Claim.
If, within thirty (30) days of receipt of such notice from the Indemnified
Person (or such shorter period as the Indemnified Person has notified the
Indemnity Provider is required by law or regulation for the Indemnified Person
to respond to such Claim), the Indemnity Provider shall request in writing that
such Indemnified Person respond to such Claim, the Indemnified Person shall, at
the expense of the Indemnity Provider, in good faith conduct and control such
action (including, without limitation, by pursuit of appeals) (provided,
however, that (A) if such Claim, in the Indemnity Person's reasonable
discretion, can be pursued by the Indemnity Provider on behalf of or in the name
of such Indemnified Person, the Indemnified Person, at the Indemnity Provider's
request, shall allow the Indemnity Provider to conduct and control the response
to such Claim and (B) in the case of any Claim, the Indemnified Person may
request the Indemnity Provider to conduct and control the response to such Claim
(with counsel to be selected by the Indemnity Provider and consented to by such
Indemnified Person, such consent not to be unreasonably withheld; provided,
however, that any Indemnified Person may retain separate counsel at the expense
of the Indemnity Provider in the event of a conflict)) by, in the sole
discretion of the Person conducting and controlling the response to such Claim
(1) resisting payment thereof, (2) not paying the same except under protest, if
protest is necessary and proper, (3) if the payment be made, using reasonable
efforts to obtain a refund thereof in appropriate administrative and judicial
proceedings,
41
or (4) taking such other action as is reasonably requested by the Indemnity
Provider from time to time.
The party controlling the response to any Claim shall consult in good faith
with the non-controlling party and shall keep the non-controlling party
reasonably informed as to the conduct of the response to such Claim; provided,
that all decisions ultimately shall be made in the discretion of the controlling
party. The parties agree that an Indemnified Person may at any time decline to
take further action with respect to the response to such Claim and may settle
such Claim if such Indemnified Person shall waive its rights to any indemnity
from the Indemnity Provider that otherwise would be payable in respect of such
Claim (and any future Claim, the pursuit of which is precluded by reason of such
resolution of such Claim) and shall pay to the Indemnity Provider any amount
previously paid or advanced by the Indemnity Provider pursuant to this Section
13.1 by way of indemnification or advance for the payment of an amount regarding
such Claim.
Notwithstanding the foregoing provisions of this Section 13.1, an
Indemnified Person shall not be required to take any action and no Indemnity
Provider shall be permitted to respond to any Claim in its own name or that of
the Indemnified Person unless (A) the Indemnity Provider shall have agreed to
pay and shall pay to such Indemnified Person on demand and on an After Tax Basis
all reasonable costs, losses and expenses that such Indemnified Person actually
incurs in connection with such Claim, including, without limitation, all
reasonable legal, accounting and investigatory fees and disbursements and, if
the Indemnified Person has informed the Indemnity Provider (in its initial
notice of the Claim) that it intends to contest such Claim (whether or not the
control of the contest is then assumed by the Indemnity Provider), the Indemnity
Provider shall have agreed that the Claim is an indemnifiable Claim hereunder,
(B) in the case of a Claim that must be pursued in the name of an Indemnified
Person (or an Affiliate thereof), the amount of the potential indemnity (taking
into account all similar or logically related Claims that have been or could be
raised for which the Indemnity Provider may be liable to pay an indemnity under
this Section 13.1) exceeds $25,000, (C) the Indemnified Person shall have
reasonably determined that the action to be taken will not result in any
material danger of sale, forfeiture or loss of the Property, or any part thereof
or interest therein, will not interfere with the payment of Rent, and will not
result in risk of criminal liability, (D) if such Claim shall involve the
payment of any amount prior to the resolution of such Claim, the Indemnity
Provider shall provide to the Indemnified Person an interest-free advance in an
amount equal to the amount that the Indemnified Person is required to pay (with
no additional net after-tax cost to such Indemnified Person), (E) in the case of
a Claim that must be pursued in the name of an Indemnified Person (or an
Affiliate thereof), the Indemnity Provider shall have provided to such
Indemnified Person an opinion of independent counsel selected by the Indemnified
Person and reasonably satisfactory to the Indemnity Provider stating that a
reasonable basis exists to contest such Claim (or, in the case of an appeal of
an adverse determination, an opinion of such counsel to the effect that the
position asserted in such appeal will more likely than not prevail) and (F) no
Event of Default shall have occurred and be continuing. In no event shall an
Indemnified Person be required to appeal an adverse judicial determination to
the United States Supreme Court. In addition, an Indemnified Person shall not be
required to contest any Claim in its name (or that of an Affiliate) if the
subject matter thereof shall be of a continuing nature and shall have previously
been decided adversely by a court of competent jurisdiction pursuant to the
contest provisions of this Section 13.1, unless there shall have been a change
in law (or interpretation
42
thereof) and the Indemnified Person shall have received, at the Indemnity
Provider's expense, an opinion of independent counsel selected by the
Indemnified Person and reasonably acceptable to the Indemnity Provider stating
that as a result of such change in law (or interpretation thereof), it is more
likely than not that the Indemnified Person will prevail in such contest.
13.2 General Tax Indemnity.
---------------------
(a) Subject to and limited by in all respects the provisions of
Sections 13.5 and 13.6, the Indemnity Provider shall pay and assume
liability for, and does hereby agree to indemnify, protect and defend each
Property and all Indemnified Persons, and hold them harmless against, all
Impositions on an After Tax Basis, and all payments pursuant to the
Operative Agreements shall be made free and clear of and without deduction
for any and all present and future Impositions.
(b) Notwithstanding anything to the contrary in Section 13.2(a)
hereof, the following shall be excluded from the indemnity required by
Section 13.2(a):
(i) Taxes (other than Taxes that are, or are in the nature of,
sales, use, rental, value added, transfer or property taxes) that are
imposed on a Indemnified Person (other than Lessor) by the United
States federal government that are based on or measured by the net
income (including taxes based on capital gains and minimum taxes) of
such Person; 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;
(ii) Taxes (other than Taxes that are, or are in the nature of,
sales, use, rental, value added, transfer or property taxes) that are
imposed on any Indemnified Person (other than Lessor) by any state or
local jurisdiction or taxing authority within any state or local
jurisdiction and that are based upon or measured by the net income or
net receipts, except that this clause (ii) shall not apply to (and
thus shall not exclude) any such Taxes imposed on an Indemnified
Person by a state (or any local taxing authority thereof or therein)
where any Property is located, possessed or used under the Lease;
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) any Tax to the extent it relates to any act, event or
omission that occurs after the termination of the Lease and redelivery
or sale of the property in accordance with the terms of the Lease (but
not any Tax that relates to such termination, redelivery or sale
and/or to any period prior to such termination, redelivery or sale);
and
(iv) any Taxes which are imposed on an Indemnified Person as a
result of the gross negligence or willful misconduct of such
Indemnified Person itself (as opposed to gross negligence or willful
misconduct imputed to such Indemnified
43
Person), but not Taxes imposed as a result of ordinary negligence of
such Indemnified Person;
(c) (i) Subject to the terms of Section 13.2(f), the Indemnity
Provider shall pay or cause to be paid all Impositions directly to the
taxing authorities where feasible and otherwise to the Indemnified Person,
as appropriate, and the Indemnity Provider shall at its own expense, upon
such Indemnified Person's reasonable request, furnish to such Indemnified
Person copies of official receipts or other satisfactory proof evidencing
such payment.
(ii) In the case of Impositions for which no contest is
conducted pursuant to Section 13.2(f) and which the Indemnity Provider
pays directly to the taxing authorities, the Indemnity Provider shall
pay such Impositions prior to the latest time permitted by the
relevant taxing authority for timely payment. In the case of
Impositions for which the Indemnity Provider reimburses an Indemnified
Person, the Indemnity Provider shall do so within thirty (30) days
after receipt by the Indemnity Provider of demand by such Indemnified
Person describing in reasonable detail the nature of the Imposition
and the basis for the demand (including the computation of the amount
payable). In the case of Impositions for which a contest is conducted
pursuant to Section 13.2(f), the Indemnity Provider shall pay such
Impositions or reimburse such Indemnified Person for such Impositions,
to the extent not previously paid or reimbursed pursuant to subsection
(a), prior to the latest time permitted by the relevant taxing
authority for timely payment after conclusion of all contests under
Section 13.2(f).
(iii) At the Indemnity Provider's request, the amount of any
indemnification payment by the Indemnity Provider pursuant to
subsection (a) shall be verified and certified by an independent
public accounting firm mutually acceptable to the Indemnity Provider
and the Indemnified Person. The fees and expenses of such independent
public accounting firm shall be paid by the Indemnity Provider unless
such verification shall result in an adjustment in the Indemnity
Provider's favor of 15% or more of the payment as computed by the
Indemnified Person, in which case such fee shall be paid by the
Indemnified Person.
(d) The Indemnity Provider shall be responsible for preparing and
filing any real and personal property or ad valorem tax returns in respect
of each Property. In case any other report or tax return shall be required
to be made with respect to any obligations of the Indemnity Provider under
or arising out of subsection (a) and of which the Indemnity Provider has
knowledge or should have knowledge, the Indemnity Provider, at its sole
cost and expense, shall notify the relevant Indemnified Person of such
requirement and (except if such Indemnified Person notifies the Indemnity
Provider that such Indemnified Person intends to file such report or
return) (A) to the extent required or permitted by and consistent with
Legal Requirements, make and file in Indemnity Provider's name such return,
statement or report; and (B) in the case of any other such return,
statement or report required to be made in the name of such Indemnified
Person, advise such Indemnified
44
Person of such fact and prepare such return, statement or report for filing
by such Indemnified Person or, where such return, statement or report shall
be required to reflect items in addition to any obligations of the
Indemnity Provider under or arising out of subsection (a), provide such
Indemnified Person at the Indemnity Provider's expense with information
sufficient to permit such return, statement or report to be properly made
with respect to any obligations of the Indemnity Provider under or arising
out of subsection (a). Such Indemnified Person shall, upon the Indemnity
Provider's request and at the Indemnity Provider's expense, provide any
data maintained by such Indemnified Person (and not otherwise available to
or within the control of the Indemnity Provider) with respect to each
Property which the Indemnity Provider may reasonably require to prepare any
required tax returns or reports.
(e) As between the Indemnity Provider on one hand, and the Lessor or
the Agent, any Lender or any Holder on the other hand, the Indemnity
Provider shall be responsible for, and the Indemnity Provider shall
indemnify and hold harmless the Lessor, the Agent, the Lenders and each
Holder (without duplication of any indemnification required by subsection
(a)) on an After Tax Basis against, any obligation for United States or
foreign withholding taxes imposed in respect of the interest payable on the
Notes or with respect to Rent payments under the Lease (and, if the Lessor,
the Agent, any Lender or any Holder receives a demand for such payment from
any taxing authority, the Indemnity Provider shall discharge such demand on
behalf of the Lessor, the Agent, such Lender or such Holder); provided,
however, that the right of any Lender to make a claim for indemnification
under this Section 13.2(e) is subject to the compliance by such Lender with
the requirements of Section 2.13 of the Credit Agreement.
(f) (i) If a written Claim is made against any Indemnified Person or
if any proceeding shall be commenced against such Indemnified Person
(including a written notice of such proceeding), for any Impositions, such
Indemnified Person shall promptly notify the Indemnity Provider in writing
and shall not take action with respect to such Claim or proceeding without
the consent of the Indemnity Provider for thirty (30) days after the
receipt of such notice by the Indemnity Provider; provided, however, that,
in the case of any such Claim or proceeding, if action shall be required by
law or regulation to be taken prior to the end of such 30-day period, such
Indemnified Person shall, in such notice to the Indemnity Provider, inform
the Indemnity Provider of such shorter period, and no action shall be taken
with respect to such Claim or proceeding without the consent of the
Indemnity Provider before 7 days before the end of such shorter period;
provided, further, that the failure of such Indemnified Person to give the
notices referred to this sentence shall not diminish the Indemnity
Provider's obligation hereunder except to the extent such failure
materially precludes the Indemnity Provider from contesting such Claim.
(ii) If, within thirty (30) days of receipt of such notice
from the Indemnified Person (or such shorter period as the Indemnified
Person has notified the Indemnity Provider is required by law or
regulation for the Indemnified Person to commence such contest), the
Indemnity Provider shall request in writing that such Indemnified
Person contest such Imposition, the Indemnified Person shall, at
45
the expense of the Indemnity Provider, in good faith conduct and
control such contest (including, without limitation, by pursuit of
appeals) relating to the validity, applicability or amount of such
Impositions (provided, however, that (A) if such contest involves a
tax other than a tax on net income and can be pursued independently
from any other proceeding involving a tax liability of such
Indemnified Person, the Indemnified Person, at the Indemnity
Provider's request, shall allow the Indemnity Provider (and the
Indemnity Provider shall be obligated) to conduct and control such
contest and (B) in the case of any contest, the Indemnified Person may
request the Indemnity Provider to conduct and control such contest
(with counsel to be selected by the Indemnity Provider and consented
to by such Indemnified Person, such consent not to be unreasonably
withheld; provided, however, that any Indemnified Person may retain
separate counsel at the expense of the Indemnity Provider in the event
of a conflict)) by, in the sole discretion of the Person conducting
and controlling such contest, (1) resisting payment thereof, (2) not
paying the same except under protest, if protest is necessary and
proper, (3) if the payment be made, using reasonable efforts to obtain
a refund thereof in appropriate administrative and judicial
proceedings, or (4) taking such other action as is reasonably
requested by the Indemnity Provider from time to time.
(iii) The party controlling any contest shall consult in
good faith with the non-controlling party and shall keep the non-
controlling party reasonably informed as to the conduct of such
contest; provided, that all decisions ultimately shall be made in the
sole discretion of the controlling party. The parties agree that an
Indemnified Person may at any time decline to take further action with
respect to the contest of any Imposition and may settle such contest
if such Indemnified Person shall waive its rights to any indemnity
from the Indemnity Provider that otherwise would be payable in respect
of such Claim (and any future Claim by any taxing authority, the
contest of which is precluded by reason of such resolution of such
Claim) and shall pay to the Indemnity Provider any amount previously
paid or advanced by the Indemnity Provider pursuant to this Section
13.2 by way of indemnification or advance for the payment of an
Imposition other than expenses of such contest.
(iv) Notwithstanding the foregoing provisions of this
Section 13.2, an Indemnified Person shall not be required to take any
action and no Indemnity Provider shall be permitted to contest any
Impositions in its own name or that of the Indemnified Person unless
(A) the Indemnity Provider shall have agreed to pay and shall pay to
such Indemnified Person on demand and on an After Tax Basis all
reasonable costs, losses and expenses that such Indemnified Person
actually incurs in connection with contesting such Impositions,
including, without limitation, all reasonable legal, accounting and
investigatory fees and disbursements, and, if the Indemnified Person
has informed the Indemnity Provider (in its initial notice of the
Imposition) that it intends to contest such Imposition (whether or not
the control of the contest is then assumed by the Indemnity Provider),
the Indemnity Provider shall have agreed that the Imposition is an
46
indemnifiable Imposition hereunder, (B) in the case of a Claim that
must be pursued in the name of an Indemnified Person (or an Affiliate
thereof), the amount of the potential indemnity (taking into account
all similar or logically related Claims that have been or could be
raised in any audit involving such Indemnified Person for which the
Indemnity Provider may be liable to pay an indemnity under this
Section 13.2) exceeds $25,000, (C) the Indemnified Person shall have
reasonably determined that the action to be taken will not result in
any material danger of sale, forfeiture or loss of any Property, or
any part thereof or interest therein, will not interfere with the
payment of Rent, and will not result in risk of criminal liability,
(D) if such contest shall involve the payment of the Imposition prior
to the contest, the Indemnity Provider shall provide to the
Indemnified Person an interest-free advance in an amount equal to the
Imposition that the Indemnified Person is required to pay (with no
additional net after-tax cost to such Indemnified Person), (E) in the
case of a Claim that must be pursued in the name of an Indemnified
Person (or an Affiliate thereof), the Indemnity Provider shall have
provided to such Indemnified Person an opinion of independent tax
counsel selected by the Indemnified Person and reasonably satisfactory
to the Indemnity Provider stating that a reasonable basis exists to
contest such Claim (or, in the case of an appeal or an adverse
determination, an opinion of such counsel to the effect that the
position asserted in such appeal will more likely than not prevail)
and (F) no Default or Event of Default shall have occurred and be
continuing. In no event shall an Indemnified Person be required to
appeal an adverse judicial determination to the United States Supreme
Court. In addition, an Indemnified Person shall not be required to
contest any Claim in its name (or that of an Affiliate) if the subject
matter thereof shall be of a continuing nature and shall have
previously been decided adversely by a court of competent jurisdiction
pursuant to the contest provisions of this Section 13.2, unless there
shall have been a change in law (or interpretation thereof) and the
Indemnified Person shall have received, at the Indemnity Provider's
expense, an opinion of independent tax counsel selected by the
Indemnified Person and reasonably acceptable to the Indemnity Provider
stating that as a result of such change in law (or interpretation
thereof), it is more likely than not that the Indemnified Person will
prevail in such contest.
13.3. EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE, STRICT LIABILITY,
------------------------------------------------------------------
ETC.
---
SUBJECT TO AND LIMITED BY IN ALL RESPECTS THE PROVISIONS OF SECTION 13.5
AND 13.6 AND WITHOUT LIMITING THE GENERALITY OF THE INDEMNIFICATION PROVISIONS
OF ANY AND ALL OF THE OPERATIVE AGREEMENTS, EACH PERSON PROVIDING
INDEMNIFICATION OF ANOTHER PERSON UNDER ANY OPERATIVE AGREEMENT HEREBY FURTHER
EXPRESSLY RELEASES EACH BENEFICIARY OF ANY SUCH INDEMNIFICATION FROM ALL CLAIMS
FOR LOSS OR DAMAGE, DESCRIBED IN ANY OPERATIVE AGREEMENT, CAUSED BY ANY ACT OR
OMISSION ON THE PART OF ANY SUCH BENEFICIARY ATTRIBUTABLE TO THE ORDINARY
NEGLIGENCE (WHETHER
47
SOLE OR CONTRIBUTORY) OR STRICT LIABILITY OF ANY SUCH BENEFICIARY, AND
INDEMNIFIES, EXONERATES AND HOLDS EACH SUCH BENEFICIARY FREE AND HARMLESS FROM
AND AGAINST ANY AND ALL ACTIONS, CAUSES OF ACTION, SUITS, CLAIMS, LOSSES, COSTS,
LIABILITIES, DAMAGES AND EXPENSES (INCLUDING WITHOUT LIMITATION REASONABLE
ATTORNEY'S FEES AND EXPENSES), DESCRIBED ABOVE, INCURRED BY ANY SUCH BENEFICIARY
(IRRESPECTIVE OF WHETHER ANY SUCH BENEFICIARY IS A PARTY TO THE ACTION FOR WHICH
INDEMNIFICATION UNDER THIS AGREEMENT OR ANY OTHER OPERATIVE AGREEMENT IS SOUGHT)
ATTRIBUTABLE TO THE ORDINARY NEGLIGENCE (WHETHER SOLE OR CONTRIBUTORY) OR STRICT
LIABILITY OF ANY SUCH BENEFICIARY.
13.4. Additional Provisions Regarding Environmental Indemnification.
-------------------------------------------------------------
Each and every Indemnified Person shall at all times have the rights and
benefits, and the Indemnity Provider shall have the obligations, in each case
provided pursuant to the Operative Agreements with respect to environmental
matters, violations of any Environmental Law, any Environmental Claim or other
loss of or damage to any property or the environment relating to any Property,
the Lease, the Agency Agreement or the Indemnity Provider (including without
limitation the rights and benefits provided pursuant to Section 13.1(c).
13.5. Additional Provisions Regarding Indemnification.
-----------------------------------------------
Notwithstanding the provisions of Sections 13.1, 13.2, 13.3 and 13.4 (other
than with respect to matters concerning indemnification for pre-existing
environmental conditions and for environmental conditions arising out of the
Construction Agent's use or possession of the Property), (a) the Owner Trustee
shall be the only beneficiary of the provisions set forth in Sections 13.1,
13.2, 13.3 and 13.4 (again, subject to the immediately preceding parenthetical
phrase) with respect to each Property solely for the period prior to the
applicable Completion Date for such Property, and (b) such limited rights of
indemnification referenced in Section 13.5(a) (to the extent relating to third-
party claims) shall be limited to third-party claims caused by or resulting from
the Indemnity Provider's acts or omissions and/or all other Persons acting by,
through or under the Indemnity Provider. After the applicable Completion Date
for such Property, each Indemnified Person shall be a beneficiary of the
provisions set forth in Sections 13.1, 13.2, 13.3 and 13.4.
13.6. Indemnifications Provided by the Owner Trustee in Favor of the Other
--------------------------------------------------------------------
Indemnified Persons.
-------------------
To the extent the Indemnity Provider is not obligated to indemnify each
Indemnified Person with respect to the various matters described in this Section
13.6, the Owner Trustee shall provide such indemnities (but only to the extent
amounts sufficient to pay such indemnity are funded by the Lenders and the
Holders) in favor of each Indemnified Person in accordance with this Section
13.6 and shall pay all such amounts owed with respect to this Section 13.6 with
amounts advanced by the Lenders and the Holders (a) to the extent, but only to
the extent,
48
amounts are available therefor with respect to the Available Commitments and the
Available Holder Commitments (subject to the rights of the Lenders and the
Holders to increase their respective commitment amounts in accordance with the
provisions of Section 5.8) and (b) unless each Lender and each Holder has
declined in writing to fund such amount. Notwithstanding any other provision in
any other Operative Agreement to the contrary, all amounts so advanced shall be
deemed added (ratably, based on the ratio of the Property Cost for each Property
individually to the Aggregate Property Cost of all Properties at such time) to
the Property Cost of all Properties then subject to the terms of the Operative
Agreements.
Whether or not any of the transactions contemplated hereby shall be
consummated, the Owner Trustee hereby assumes liability for and agrees to
defend, indemnify and hold harmless each Indemnified Person on an After Tax
Basis from and against any Claims, which may be imposed on, incurred by or
asserted against an Indemnified Person by any third party, including without
limitation Claims arising from the negligence of an Indemnified Person (but not
to the extent such Claims arise from the gross negligence or willful misconduct
of such Indemnified Person itself, as determined by a court of competent
jurisdiction, as opposed to gross negligence or willful misconduct imputed to
such Indemnified Person or breach of such Indemnified Person's obligations under
this Agreement, the Lease or any other Operative Agreement) in any way relating
to or arising or alleged to arise out of the execution, delivery, performance or
enforcement of this Agreement, the Lease or any other Operative Agreement or on
or with respect to any Property or any component thereof, including without
limitation Claims in any way relating to or arising or alleged to arise out of
the matters set forth in clauses (a) through (g) of the first paragraph of
Section 13.1.
The Owner Trustee shall pay and assume liability for, and does hereby agree
to indemnify, protect and defend each Property and all Indemnified Persons, and
hold them harmless against, all Impositions on an After Tax Basis, and all
payments pursuant to the Operative Agreements shall be made free and clear of
and without deduction for any and all present and future Impositions.
Notwithstanding anything to the contrary in this paragraph, the Excluded Taxes
shall be excluded from the indemnity provisions afforded by this paragraph.
THE INDEMNITY OBLIGATIONS UNDERTAKEN BY THE OWNER TRUSTEE PURSUANT TO THIS
SECTION 13.6 ARE IN ALL RESPECTS SUBJECT TO THE LIMITATIONS ON LIABILITY
REFERENCED IN SECTION 14.10.
SECTION 14 MISCELLANEOUS.
14.1 Survival of Agreements.
----------------------
The representations, warranties, covenants, indemnities and agreements of
the parties provided for in the Operative Agreements, and the parties'
obligations under any and all thereof, shall survive the execution and delivery
of this Agreement, the transfer of any Property to the Owner Trustee, the
acquisition of any Equipment, the construction of any Improvements, any
disposition of any interest of the Owner Trustee in any Property or any interest
of the Holders in the Owner Trust, the payment of the Notes and any disposition
thereof and shall be and continue in
49
effect notwithstanding any investigation made by any party and the fact that any
party may waive compliance with any of the other terms, provisions or conditions
of any of the Operative Agreements. Except as otherwise expressly set forth
herein or in other Operative Agreements, the indemnities of the parties provided
for in the Operative Agreements shall survive the expiration or termination of
any thereof.
14.2 No Broker, etc.
--------------
Except as expressly provided in that certain engagement letter agreement
dated as of April 13, 1999 among Bank of America, N.A., a national banking
association, which is the successor to NationsBank, N.A., BancAmerica Securities
LLC, which is the successor to NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities, LLC, Capital
One Bank and Capital One Financial Corporation, each of the parties hereto
represents to the others that it has not retained or employed any broker, finder
or financial adviser to act on its behalf in connection with this Agreement, nor
has it authorized any broker, finder or financial adviser retained or employed
by any other Person so to act. Any party who is in breach of this
representation shall indemnify and hold the other parties harmless from and
against any liability arising out of such breach of this representation.
14.3 Notices.
-------
Unless otherwise specifically provided herein, all notices, consents,
directions, approvals, instructions, requests and other communications required
or permitted by the terms hereof to be given to any Person shall be given in
writing by United States mail, by nationally recognized courier service or by
hand and any such notice shall become effective upon receipt and shall be
directed to the address of such Person as indicated:
If to the Lessee or the Construction Agent, to it at the following address:
Capital One Services, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Director of Capital Markets
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to :
Capital One Financial Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Director of Capital Markets
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
50
If to the Guarantor, to it at the following address:
Capital One Financial Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Director of Capital Markets
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to the Legal Department of Capital One Financial Corporation at
the immediately preceding address.
If to the Owner Trustee, to it at the following address:
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇
Corporate Trust Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Holders, to each such Holder at the address set forth for such
Holder on the signature page of the Trust Agreement.
If to the Agent, to it at the following address:
Bank of America, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to any Lender, to it at the address set forth for such Lender in
Schedule 1.1 of the Credit Agreement.
From time to time any party may designate a new address for purposes of
notice hereunder by notice to each of the other parties hereto.
14.4 Counterparts.
------------
This Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original,
but all such counterparts shall together constitute but one and the same
instrument.
51
14.5 Amendments and Termination.
--------------------------
Neither this Agreement nor any of the terms hereof may be terminated,
amended, supplemented, waived or modified except by an instrument in writing
signed by the party against which the enforcement of the termination, amendment,
supplement, waiver or modification shall be sought. This Agreement may be
terminated by an agreement signed in writing by the Owner Trustee, the Holders,
the Lenders, each Credit Party and the Agent.
14.6 Headings, etc.
--------------
The Table of Contents and headings of the various Articles and Sections of
this Agreement are for convenience of reference only and shall not modify,
define, expand or limit any of the terms or provisions hereof.
14.7 Parties in Interest.
-------------------
Except as expressly provided herein, none of the provisions of this
Agreement are intended for the benefit of any Person except the parties hereto.
14.8 GOVERNING LAW; WAIVERS OF JURY TRIAL.
------------------------------------
(a) THIS AGREEMENT SHALL IN ALL RESPECTS BE GOVERNED BY THE LAW OF
THE COMMONWEALTH OF VIRGINIA AS TO ALL MATTERS OF CONSTRUCTION, VALIDITY
AND PERFORMANCE.
(b) EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVE
TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT
AND FOR ANY COUNTERCLAIM THEREIN.
14.9 Severability.
------------
Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
14.10 Liability Limited.
-----------------
(a) The Agent, the Credit Parties, the Lenders and the Holders each
acknowledge and agree that the Owner Trustee is (except as otherwise
expressly provided herein or therein) entering into this Agreement and the
other Operative Agreements to which it is a party (other than the Trust
Agreement and to the extent otherwise provided in
52
Section 7.2 of this Agreement), solely in its capacity as trustee under the
Trust Agreement and not in its individual capacity and that Trust Company
shall not be liable or accountable under any circumstances whatsoever in
its individual capacity for or on account of any statements,
representations, warranties, covenants or obligations stated to be those of
the Owner Trustee, except for its own gross negligence or willful
misconduct and as otherwise expressly provided herein or in the other
Operative Agreements.
(b) Anything to the contrary contained in this Agreement, the Credit
Agreement, the Notes or in any other Operative Agreement notwithstanding,
neither the Lessor nor any Holder nor any officer, director, shareholder,
or partner thereof, nor any of the successors or assigns of the foregoing
(all such Persons being hereinafter referred to collectively as the
"Exculpated Persons"), shall be personally liable in any respect for any
liability or obligation hereunder or in any other Operative Agreement
including the payment of the principal of, or interest on, the Notes, or
for monetary damages for the breach of performance of any of the covenants
contained in the Credit Agreement, the Notes, this Agreement, the Security
Agreement or any of the other Operative Agreements. The Agent (for itself
and on behalf of the Lenders) agrees that, in the event the Agent or any
Lender pursues any remedies available to them under the Credit Agreement,
the Notes, this Agreement, the Security Agreement, the Mortgage Instruments
or under any other Operative Agreement, neither the Lenders nor the Agent
shall have any recourse against any Exculpated Person, for any deficiency,
loss or Claim for monetary damages or otherwise resulting therefrom and
recourse shall be had solely and exclusively against the COSI Trust Estate
and the Credit Parties (with respect to the Credit Parties' obligations
under the Lease, the Participation Agreement and the Agency Agreement); but
nothing contained herein shall be taken to prevent recourse against or the
enforcement of remedies against the COSI Trust Estate in respect of any and
all liabilities, obligations and undertakings contained herein, in the
Credit Agreement, in the Notes, in the Security Agreement, the Mortgage
Instruments or in any other Operative Agreement. Notwithstanding the
provisions of this Section, nothing in this Agreement, the Credit
Agreement, the Notes, the Security Agreement, the Mortgage Instruments or
any other Operative Agreement shall: (i) constitute a waiver, release or
discharge of any indebtedness or obligation evidenced by the Notes or
arising under this Agreement, the Security Agreement, the Mortgage
Instruments or the Credit Agreement or secured by the Security Agreement,
the Mortgage Instruments or any other Operative Agreement, but the same
shall continue until paid or discharged; (ii) relieve the Lessor or any
Exculpated Person from liability and responsibility for (but only to the
extent of the damages arising by reason of): (a) active waste knowingly
committed by the Lessor or any Exculpated Person with respect to the
Properties or (b) any fraud, gross negligence, willful misconduct or
willful breach on the part of the Lessor or any such Exculpated Person;
(iii) relieve the Lessor or any Exculpated Person from liability and
responsibility for (but only to the extent of the moneys misappropriated,
misapplied or not turned over) (a) except for Excepted Payments,
misappropriation or misapplication by the Lessor (i.e., application in a
manner contrary to any Operative Agreement) of any insurance proceeds or
condemnation award paid or delivered to the Lessor by any Person other than
the Agent, (b) except for Excepted Payments, any deposits or any escrows or
amounts owed by the Lessee under the Agency Agreement held by the Lessor or
(c) except for Excepted
53
Payments, any rents or other income received by the Lessor from any Credit
Party that are not turned over to the Agent; or (iv) affect or in any way
limit the Agent's rights and remedies under any Operative Agreement with
respect to the Rents and its rights and powers thereunder or to obtain a
judgment against the Lessee's interest in the Properties or to the extent
the Lessee may be personally liable as otherwise contemplated in clauses
(ii) and (iii) of this Section.
14.11 Rights of the Credit Parties.
----------------------------
Notwithstanding any provision of the Operative Agreements, if at any time
all obligations (i) of the Owner Trustee under the Credit Agreement and the
Security Documents and (ii) of the Credit Parties under the Operative Agreements
have in each case been satisfied or discharged in full, then the Credit Parties
shall be entitled to (a) terminate the Lease and the guaranty obligations under
Section 8B (other than the obligations under Section 8B.5) and (b) receive all
amounts then held under the Operative Agreements and all proceeds with respect
to any of the Properties. Upon the termination of the Lease and the guaranty
obligations under Section 8B (other than the obligations under Section 8B.5)
pursuant to the foregoing clause (a), except as provided under Section 22.1 of
the Lease, the Lessor at the Lessee's expense shall transfer to the Lessee all
of its right, title and interest free and clear of the Lien of the Lease and all
Lessor Liens in and to any Properties then subject to the Lease and any amounts
or proceeds referred to in the foregoing clause (b) shall be paid over to the
Lessee.
14.12 Further Assurances.
------------------
The parties hereto shall promptly cause to be taken, executed, acknowledged
or delivered all such further acts, conveyances, documents and assurances as the
other parties may from time to time reasonably request in order to carry out and
effectuate the intent and purposes of this Participation Agreement, the other
Operative Agreements and the transactions contemplated hereby and thereby
(including, without limitation, the preparation, execution and filing of any and
all Uniform Commercial Code financing statements and other filings or
registrations which the parties hereto may from time to time request to be filed
or effected). The Lessee, without need of any prior request from any other
party, shall take such action as may be necessary (including any action
specified in the preceding sentence), or (if Owner Trustee shall so request) as
so requested, in order to maintain and protect all security interests provided
for hereunder or under any other Operative Agreement.
14.13 Calculations under Operative Agreements.
---------------------------------------
The parties hereto agree that all calculations and numerical determinations
to be made under the Operative Agreements by the Owner Trustee shall be made by
the Agent and that such calculations and determinations shall be conclusive and
binding on the parties hereto in the absence of manifest error.
54
14.14 Confidentiality.
---------------
Each of the Owner Trustee, the Holders, the Agent and the Lenders severally
hereby agrees to use reasonable efforts to keep confidential all non-public
information pertaining to any Credit Party or such Credit Party's Subsidiaries
which is provided to it by any Credit Party or such Credit Party's Subsidiaries
and which an officer of any Credit Party or any of such Credit Party's
Subsidiaries has requested in writing be kept confidential, and shall not
intentionally disclose such information to any Person except:
(a) to the extent such information is public when received by such
Person or becomes public thereafter due to the act or omission of any party
other than such Person;
(b) to the extent such information is lawfully and independently
obtained from a source other than a Credit Party or any of such Credit
Party's Affiliates and such Person neither knows or has reason to know that
such information from such source is subject to an obligation of
confidentiality or, if such information is subject to an obligation of
confidentiality, that disclosure of such information is permitted;
(c) to counsel, auditors, accountants or agents retained by any such
Person or any Affiliates of any such Person provided they agree to keep
such information confidential as if such Person or Affiliate were party to
this Agreement and to financial institution regulators, including examiners
of any Lender, the Agent or the Owner Trustee, any Holder or any Affiliate
in the course of examinations of such Persons;
(d) in connection with any litigation or the enforcement or
preservation of the rights of the Agent, the Owner Trustee, the Lessor, any
Lender or any Holder under the Operative Agreements;
(e) to the extent required by any applicable statute, rule or
regulation or court order (including, without limitation, by way of
subpoena) or pursuant to the request of any regulatory or Governmental
Authority having jurisdiction over any such Person; provided, however, that
such Person shall endeavor (if not otherwise prohibited by Law) to notify
the Lessee prior to any disclosure made pursuant to this clause (e), except
that no such Person shall be subject to any liability whatsoever for any
failure to so notify the Lessee;
(f) the Agent may disclose such information to the Lenders; or
(g) to the extent disclosure to other financial institutions or other
Persons is appropriate in connection with any proposed or actual (i)
assignment or grant of a participation by any of the Lenders of interests
in the Credit Agreement and/or any Note to such other financial
institutions or (ii) assignment by any Holder of interests in the Trust
Agreement to another Person; so long as such financial institution or other
Person first executes and delivers a "Confidentiality Agreement" in the
form attached hereto as Exhibit J.
55
The obligations of any such financial institution or other Person that has
executed a Confidentiality Agreement in the form of Exhibit J hereto shall be
---------
superseded by this Section 14.14 upon the date upon which such financial
institution or other Person becomes a Lender or Holder hereunder.
[signature pages follow]
56
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers thereunto duly authorized as of
the day and year first above written.
CAPITAL ONE SERVICES, INC., as Construction Agent
and as Lessee
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------------
Title: Director of Corporate Funding
-----------------------------------------
CAPITAL ONE FINANCIAL CORPORATION,
as Guarantor
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------------
Title: Director of Corporate Funding
-----------------------------------------
(Signature pages continue)
FIRST SECURITY BANK, NATIONAL ASSOCIATION, not
individually, except as expressly stated
herein, but solely as Owner Trustee under
the Capital One Realty Trust 1998-1
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------
Title: Assistant Trust Officer
-----------------------------------------
(Signature pages continue)
BANK OF AMERICA, N.A., as a Holder, as a Lender
and as Administrative Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Title: Vice President
-----------------------------------------
(Signature pages continue)
FIRST NATIONAL BANK OF CHICAGO, as a Holder and a
Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
Title: Vice President
-----------------------------------------
(Signature pages continue)
BARCLAYS BANK PLC, as a Holder and a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------
Title: Director
-----------------------
(Signature pages continue)
FIRST UNION NATIONAL BANK, as a Holder and a
Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
------------------------
Title: Vice President
------------------------
(Signature pages continue)
BMO GLOBAL CAPITAL SOLUTIONS, INC., as a Holder
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------
Title: Vice President
-----------------------
(Signature pages continue)
BMO GLOBAL CAPITAL SOLUTIONS, INC., as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------
Title: Vice President
-----------------------
(Signature pages continue)
BANK OF MONTREAL, as a Lender
By: /s/ ▇▇▇▇ ▇▇▇▇
-----------------------
Name: ▇▇▇▇ ▇▇▇▇
-----------------------
Title: Director
-----------------------
(Signature pages continue)
KBC BANK N.V., as a Lender
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------
Title: First Vice President
-------------------------
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
-------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
-------------------------
Title: Vice President
-------------------------
(Signature page continues)
CREDIT LYONNAIS - NY BRANCH, as a Lender
By: /s/ W. ▇▇▇ ▇▇▇▇▇▇▇
-------------------------
Name: W. ▇▇▇ ▇▇▇▇▇▇▇
-------------------------
Title: Vice President
-------------------------
(Signature pages end)
EXHIBIT A
---------
REQUISITION FORM
----------------
(Capital One Services, Inc.)
(Pursuant to Sections 4.2 and 5.2 of the Participation Agreement)
Capital One Services, Inc., a Delaware corporation (the "Company") hereby
certifies as true and correct and delivers the following Requisition to First
Security Bank, National Association, not individually, except as expressly
stated in the Participation Agreement (hereinafter defined), but solely as Owner
Trustee under the Capital One Realty Trust 1998-1 ("Lessor"), the banks and
------
other lending institutions parties thereto from time to time, as the holders
(the "Holders"), the banks and other lending institutions parties thereto from
-------
time to time, as lenders (the "Lenders") and Bank of America, N.A., as
Administrative Agent for the Lenders and respecting the Security Documents, as
Administrative Agent for the Lenders and the Holders, to the extent of their
interests (the "Agent"):
-----
Reference is made herein to that certain Participation Agreement (Capital
One Services, Inc.), dated as of September 3, 1999 (as such may be amended from
time to time, the "Participation Agreement") among the Company, in its capacity
-----------------------
as Lessee and as Construction Agent, the Guarantor, the Lessor, the Holders, the
Lenders and the Agent. Capitalized terms used herein but not otherwise defined
herein shall have the meanings set forth therefor in the Participation
Agreement.
Check one:
____ INITIAL CLOSING DATE: _________________
(three Business Days prior notice required for Advance)
____ PROPERTY CLOSING DATE: _________________
(three Business Days prior notice required for Advance)
____ CONSTRUCTION ADVANCE DATE: _____________
(three Business Days prior notice required for Advance)
1. Transaction Expenses and other fees, expenses and disbursements under
Article IX of the Participation Agreement and any and all other amounts
contemplated to be financed under the Participation Agreement including
without limitation any Work, broker's fees, taxes, recording fees and the
like (with supporting invoices or closing statement attached):
Party to Whom Amount Owed
Amount is Owed (in U.S. Dollars)
-------------- ---------------
__________ __________
__________ __________
__________ __________
__________ __________
A-1
______________ _______________
2. Legal Description of Land (which shall be a legal description of the Land
in connection with an Advance to pay Property Acquisition Costs and which
shall otherwise be a street address for the applicable Property): See
attached Schedule 1
----------
3. Aggregate Loans and Holder Fundings requested since the Initial Closing
Date with respect to each Property for which Advances are requested under
this Requisition (listed on a Property by Property basis), including all
amounts requested under this Requisition:
$______________ [Property]
In connection with this Requisition, the Company hereby requests that the
Lenders make Loans to the Lessor in the amount of $______________ and that the
Holders make Holder Fundings to the Lessor in the amount of $________________.
The Company hereby certifies (i) that the foregoing amounts requested do not
exceed the total aggregate of the Available Commitments plus the Available
Holder Commitments and (ii) each of the provisions of the Participation
Agreement applicable to the Loans and Holder Fundings requested hereunder have
been complied with as of the date of this Requisition.
The Company has caused this Requisition to the executed by its duly
authorized officer as of this _____ day of __________, ___.
CAPITAL ONE SERVICES, INC.
By: __________________________________
Name: ________________________________
Title: _______________________________
A-2
Schedule 1
----------
Legal Description of Land
A-3
EXHIBIT B
---------
CAPITAL ONE BANK
OFFICER'S CERTIFICATE
---------------------
(Pursuant to Section 5.5 of the Participation Agreement)
CAPITAL ONE SERVICES, INC., a Delaware corporation (the "Company") DOES HEREBY
CERTIFY as follows:
1. The address for the subject Property is ___________________
__________________________________.
2. The Completion Date for the construction of Improvements at the Property
occurred on ______________.
3. The aggregate Property Cost for the Property was $___________.
4. All Improvements have been made in accordance with all applicable Legal
Requirements, in a good and workmanlike manner and otherwise in full
compliance with the standards and practices of the Company with respect to
Company-owned properties and improvements.
Capitalized terms used in this Officer's Certificate and not otherwise defined
have the respective meanings ascribed thereto in the Participation Agreement
(Capital One Services, Inc.) dated as of September 3, 1999 among the Company, as
Lessee and as Construction Agent, Capital One Financial Corporation, as
Guarantor, First Security Bank, National Association, as Owner Trustee, the
various banks and other lending institutions which are parties thereto from time
to time, as Holders, the various banks and other lending institutions which are
parties thereto from time to time, as Lenders and Bank of America, N.A., as the
Administrative Agent.
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be duly
executed and delivered as of this ____ day of ______________, _____.
CAPITAL ONE SERVICES, INC.
By: _________________________________
Name: _______________________________
Title: ______________________________
B-1
Schedule I
----------
B-2
EXHIBIT C
---------
[Counsel Opinion for Lessee]
(Pursuant to Section 6.1(c) of the Participation Agreement)
__________ ___, 1999
TO THOSE ON THE ATTACHED DISTRIBUTION LIST
Re: Tax Retention Operating Lease Financing Provided in favor of
Capital One Services, Inc.
Dear Sirs:
We have acted as special counsel to Capital One Services, Inc., a Delaware
corporation (the "Lessee") and Capital One Financial Corporation, a Delaware
corporation (the "Guarantor") in connection with certain transactions
contemplated by the Participation Agreement (Capital One Services, Inc.) dated
as of September 3, 1999 (the "Participation Agreement"), among the Lessee, the
Guarantor, First Security Bank, National Association, not individually, but
solely as Owner Trustee under the Capital One Realty Trust 1998-1 (the "Owner
Trustee"), the various banks and other lending institutions parties thereto from
time to time, as the holders (the "Holders), the various banks and other lending
institutions parties thereto from time to time, as the lenders (the "Lenders"),
and Bank of America, N.A., as the administrative agent for the Lenders and
respecting the Security Documents, as the administrative agent for the Lenders
and the Holders, to the extent of their interests (the "Administrative Agent").
This opinion is delivered pursuant to Section 6.1(c) of the Participation
Agreement. All capitalized terms used herein, and not otherwise defined herein,
shall have the meanings assigned thereto in Appendix A to the Participation
Agreement.
In connection with the foregoing, we have examined originals, or copies
certified to our satisfaction, of the Operative Agreements, and such other
corporate documents and records of the Credit Parties, certificates of public
officials and representatives of the Credit Parties as to certain factual
matters, and such other instruments and documents which we have deemed necessary
or advisable to examine for the purpose of this opinion. With respect to such
examination, we have assumed (i) the statements of fact made in all such
certificates, documents and instruments are true, accurate and complete; (ii)
the due authorization, execution and delivery of the Operative Agreements by the
parties thereto other than the Credit Parties; (iii) the genuineness of all
signatures (other than the signatures of persons signing on behalf of the Credit
Parties), the authenticity and completeness of all documents, certificates,
instruments, records and corporate records submitted to us as originals and the
conformity to the original instruments of all documents
C-1
submitted to us as copies, and the authenticity and completeness of the
originals of such copies; (iv) that all parties other than the Credit Parties
have all requisite corporate power and authority to execute, deliver and perform
the Operative Agreements; and (v) the enforceability of the Operative Agreements
against all parties thereto other than the Credit Parties.
Based on the foregoing, and having due regard for such legal considerations as
we deem relevant, and subject to the limitations and assumptions set forth
herein, including the matters set forth in the last two paragraphs hereof, we
are of the opinion that:
(a) Each Credit Party is a corporation duly incorporated, validly existing
and in good standing under the laws of the state of its incorporation or
formation and has the power and authority to conduct its business as presently
conducted and to execute, deliver and perform its obligations under the
Operative Agreements to which it is a party. Each Credit Party is duly
qualified to do business in all jurisdictions in which its failure to so qualify
would materially impair its ability to perform its obligations under the
Operative Agreements to which it is a party or its financial position or its
business as now and now proposed to be conducted.
(b) The execution, delivery and performance by each Credit Party of the
Operative Agreements to which it is a party have been duly authorized by all
necessary corporate action on the part of such Credit Party and the Operative
Agreements to which such Credit Party is a party have been duly executed and
delivered by such Credit Party.
(c) The Operative Agreements to which each Credit Party is a party
constitute valid and binding obligations of such Credit Party enforceable
against such Credit Party in accordance with the terms thereof, subject to
bankruptcy, insolvency, liquidation, reorganization, fraudulent conveyance, and
similar laws affecting creditors' rights generally, and general principles of
equity (regardless of whether the application of such principles is considered
in a proceeding in equity or at law).
(d) The execution and delivery by each Credit Party of the Operative
Agreements to which it is a party and compliance by such Credit Party with all
of the provisions thereof do not and will not (i) contravene the provisions of,
or result in any breach of or constitute any default under, or result in the
creation of any Lien (other than Permitted Liens) upon any of its property
under, its Articles of Incorporation or By-Laws or any indenture, mortgage,
chattel mortgage, deed of trust, lease, conditional sales contract, bank loan or
credit agreement or other agreement or instrument to which such Credit Party is
a party or by which it or any of its property may be bound or affected, or (ii)
contravene any Laws or any order of any Governmental Authority applicable to or
binding on such Credit Party.
(e) No Governmental Action by, and no notice to or filing with, any
Governmental Authority is required for the due execution, delivery or
performance by any Credit Party of any of the Operative Agreements to which it
is a party.
(f) Except as set forth on Schedule 1 hereto, there are no actions, suits
or proceedings pending or to our knowledge, threatened against any Credit Party
in any court or before any
C-2
Governmental Authority, that concern the Property or any Credit Party's interest
therein or that question the validity or enforceability of any Operative
Agreement to which such Credit Party is a party or the overall transaction
described in the Operative Agreements to which such Credit Party is a party.
(g) Neither the nature of the Property, nor any relationship between any
Credit Party and any other Person, nor any circumstance in connection with the
execution, delivery and performance of the Operative Agreements to which such
Credit Party is a party is such as to require any approval of stockholders of,
or approval or consent of any trustee or holders of indebtedness of, such Credit
Party, except for such approvals and consents which have been duly obtained and
are in full force and effect.
(h) The Security Documents which have been executed and delivered as of
the date of this opinion create, for the benefit of the holders of the Notes,
the security interest in the C Collateral described therein which by their terms
such Security Documents purports to create. Upon filing of the UCC-1 financing
statements with ________________________ [identify filing offices], the Agent
will have a perfected security interest in that portion of the Collateral which
can be perfected by such filing under Article 9 of the UCC.
(i) The Operative Agreements to which First Security Bank, National
Association, as Owner Trustee, is a party constitute are enforceable against
First Security Bank, National Association, as Owner Trustee, as the case may be,
enforceable against First Security Bank, National Association, individually or
as Owner Trustee, in accordance with the terms thereof, subject to bankruptcy,
insolvency, liquidation, reorganization, fraudulent conveyance, and similar laws
affecting creditors, rights generally, and general principles of equity
(regardless of whether the application of such principles is considered in a
proceeding in equity or at law).
(j) The execution and delivery by First Security Bank, National
Association, individually or as Owner Trustee, as the case may be, of the
Operative Agreements (other than the Trust Agreement) to which it is a party and
compliance by First Security Bank, National Association, individually or as
Owner Trustee, with all of the provisions thereof do not and will not contravene
any law, rule or regulation of ___________________.
(k) The Mortgage Instrument and UCC fixture filings relating thereto are
in proper form for recording and/or filing with the _________________ and
___________________ [identify filing offices in state], respectively.
This opinion is limited to the matters stated herein and no opinion is
implied or may be inferred beyond the matters stated herein. This opinion is
based on and is limited to the laws of the ______________________, and the
federal laws of the United States of America. Insofar as the foregoing opinion
relates to matters of law other than the foregoing, no opinion is hereby given.
This opinion is for the sole benefit of Lessee, the Guarantor, Bank of America,
N.A., as the Administrative Agent, the Holders, the Lenders, First Security
Bank, National Association, not individually, but solely as Owner Trustee under
the Capital One Realty Trust 1998-1 and their
C-3
respective successors and assigns and may not be relied upon by any other person
other than such parties and their respective successors and assigns without the
express written consent of the undersigned. The opinions expressed herein are as
of the date hereof and we make no undertaking to amend or supplement such
opinions if facts come to our attention or changes in the current law of the
jurisdictions mentioned herein occur which could affect such opinions.
Very truly yours,
[LESSEE'S COUNSEL]
C-4
Distribution List
Bank of America, N.A., as Administrative Agent
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as the Lenders.
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as the Holders.
First Security Bank, National Association, not individually, but solely as Owner
Trustee under the Capital One Realty Trust 1998-1
C-5
EXHIBIT D
---------
[NAME OF CREDIT PARTY]
OFFICER'S CERTIFICATE
(Pursuant to Section 6.1(g) of the Participation Agreement)
[NAME OF CREDIT PARTY], a ________ corporation (the "Company"), DOES HEREBY
CERTIFY as follows:
1. Each and every representation and warranty of the Company contained in the
Operative Agreements to which it is a party is true and correct on and as
of the date hereof.
2. No Default or Event of Default has occurred and is continuing under any
Operative Agreement.
3. Each Operative Agreement to which the Company is a party is in full force
and effect with respect to it.
4. The Company has duly performed and complied with all covenants, agreements
and conditions contained in the Participation Agreement (hereinafter
defined) or in any Operative Agreement required to be performed or complied
with by it on or prior to the date hereof.
Capitalized terms used in this Officer's Certificate and not otherwise defined
herein have the respective meanings ascribed thereto in the Participation
Agreement (Capital One Services, Inc.) dated as of September 3, 1999 among the
Capital One Services, Inc., as Lessee and as Construction Agent, Capital One
Financial Corporation, as guarantor (the "Guarantor"), First Security Bank,
---------
National Association, not individually, but solely as owner Trustee under the
Capital One Realty Trust 1998-1, the various banks and other lending
institutions which are parties thereto from time to time, as holders (the
"Holders"), the various banks and other lending institutions which are parties
-------
thereto from time to time, as lenders (the "Lenders") and Bank of America, N.A.,
as Administrative Agent for the Lenders and respecting the Security Documents,
as Administrative Agent for the Lenders and the Holders, to the extent of their
interests (the "Agent")
-----
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be duly
executed and delivered as of this _____ day of __________, 1999.
[NAME OF CREDIT PARTY]
By:________________________________
Name:______________________________
Title:_____________________________
D-1
EXHIBIT E
---------
[NAME OF CREDIT PARTY]
OFFICER'S CERTIFICATE
---------------------
(Pursuant to Section 6.1(h) of the Participation Agreement)
[NAME OF CREDIT PARTY], a __________________ corporation (the "Company")
DOES HEREBY CERTIFY as follows:
1. Attached hereto as Schedule I is a true, correct and complete copy of the
----------
resolutions of the Board of Directors of the Company duly adopted by the
Board of Directors of the Company on __________. Such resolutions have not
been amended, modified or rescinded since their date of adoption and remain
in full force and effect as of the date hereof.
2. Attached hereto as Schedule II is a true, correct and complete copy of the
-----------
Articles of Incorporation of the Company on file in the Office of
_____________. Such Articles of Incorporation have not been amended,
modified or rescinded since their date of adoption and remain in full force
and effect as of the date hereof.
3. Attached hereto as Schedule III is a true, correct and complete copy of the
------------
Bylaws of the Company. Such Bylaws have not been amended, modified or
rescinded since their date of adoption and remain in full force and effect
as of the date hereof.
4. The persons named below now hold the offices set forth opposite their
names, and the signatures opposite their names and titles are their true
and correct signatures.
Name Office Signature
---- ------ ---------
_________________ _________________ ____________________
_________________ _________________ ____________________
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be duly
executed and delivered as of this _____ day of ___________, 1999.
[NAME OF CREDIT PARTY]
By:________________________________
Name:______________________________
Title:_____________________________
E-1
SCHEDULE I
----------
BOARD RESOLUTIONS
E-2
SCHEDULE II
-----------
ARTICLES OF INCORPORATION
E-3
SCHEDULE III
------------
BYLAWS
E-4
EXHIBIT F
---------
FIRST SECURITY BANK, NATIONAL ASSOCIATION
OFFICER'S CERTIFICATE
(Pursuant to Section 6.2(d) of the Participation Agreement)
FIRST SECURITY BANK, NATIONAL ASSOCIATION, not individually (except with
respect to paragraph 1 below, to the extent any such representations and
warranties are made in its individual capacity) but solely as owner trustee
under the Capital One Realty Trust 1998-1 (the "Owner Trustee"), DOES HEREBY
CERTIFY as follows:
(a) Each and every representation and warranty of the Owner Trustee contained
in the Operative Agreements to which it is a party is true and correct on
and as of the date hereof.
(b) Each Operative Agreement to which the Owner Trustee is a party is in full
force and effect with respect to it.
(c) The Owner Trustee has duly performed and complied with all covenants,
agreements and conditions contained in the Participation Agreement
(hereinafter defined) or in any Operative Agreement required to be
performed or complied with by it on or prior to the date hereof.
Capitalized terms used in this Officer's Certificate and not otherwise defined
herein have the respective meanings ascribed thereto in the Participation
Agreement (Capital One Services, Inc.) dated as of September 3, 1999 among
Capital One Services, Inc., as Lessee and as Construction Agent, Capital One
Financial Corporation, as guarantor (the "Guarantor"), the Owner Trustee, the
---------
various banks and other lending institutions which are parties thereto from time
to time, as holders (the "Holders"), the various banks and other lending
-------
institutions which are parties thereto from time to time, as lenders (the
"Lenders") and Bank of America, N.A., as Administrative Agent for the Lenders
and respecting the Security Documents, as Administrative Agent for the Lenders
and the Holders, to the extent of their interests (the "Agent").
-----
IN WITNESS WHEREOF, the Owner Trustee has caused this Officer's Certificate to
be duly executed and delivered as of this _____ day of __________ 1999.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not individually,
except as expressly stated herein,
but solely as Owner Trustee under
the Capital One Realty Trust 1998-1
By:________________________________
Name:______________________________
Title:_____________________________
F-1
EXHIBIT G
---------
FIRST SECURITY BANK, NATIONAL ASSOCIATION
OFFICER'S CERTIFICATE
---------------------
(Pursuant to Section 6.2(e) of the Participation Agreement)
CERTIFICATE OF ASSISTANT SECRETARY
I, ______________________, duly elected and qualified Assistant Secretary
of the Board of Directors of First Security Bank, National Association (the
"Association"), hereby certify as follows:
1. The Association is a National Banking Association duly organized,
validly existing and in good standing under the laws of the United States. With
respect thereto the following is noted:
A. Pursuant to Revised Statutes 324, et seq., as amended, 12 U.S.C. 1, et
seq., the Comptroller of the Currency charters and exercises
regulatory and supervisory authority over all National Banking
Associations;
B. On December 9, 1881, the First National Bank of Ogden, Utah was
chartered as a National Banking Association under the laws of the
United States and under Charter No. 2597;
C. On October 2, 1922, in connection with a consolidation of The First
National Bank of Ogden, Ogden, Utah, and The Utah National Bank of
Ogden, Ogden, Utah, the title was changed to "The First & Utah
National Bank of Ogden"; on January 18, 1923, The First & Utah
National Bank of Ogden changed its title to "First Utah National Bank
of Ogden"; on January 19, 1926, the title was changed to "First
National Bank of Ogden"; on February 24, 1934, the title was changed
to "First Security Bank of Utah, National Association"; on June 21,
1996, the title was changed to "First Security Bank, National
Association"; and
D. First Security Bank, National Association, Ogden, Utah, continues to
hold a valid certificate to do business as a National Banking
Association.
2. The Association's Articles of Association, as amended, are in full
force and effect, and a true, correct and complete copy is attached hereto as
Schedule A and incorporated herein by reference. Said Articles were last amended
October 20, 1975, as required by law on notice at a duly called special meeting
of the shareholders of the Association.
3. The Association's By-Laws, as amended, are in full force and effect;
and a true, correct and complete copy is attached hereto as Schedule B and
incorporated herein by reference. Said By-Laws, still in full force and effect,
were adopted September 17, 1942, by resolution, after proper notice of
consideration and adoption of By-Laws was given to each and every shareholder,
at a regularly called meeting of the Board of Directors with a quorum present.
4. Pursuant to the authority vested in it by an Act of Congress approved
December 23, 1913 and known as the Federal Reserve Act, as amended, the Federal
Reserve Board (now the Board of Governors of the Federal Reserve System) has
granted to the Association now known as "First Security Bank, National
Association" of Ogden, Utah, the right to act, when not in contravention of
State or local law, as trustee, executor, administrator, registrar of stocks and
bonds, guardian of estates, assignee, receiver, committee of estates of
lunatics, or in any other fiduciary capacity in which State banks, trust
companies or other corporations which come into competition with National Banks
are permitted to act under the laws of the State of Utah; and under the
provisions of applicable law, the authority so granted remains in full force and
effect.
5. Pursuant to authority vested by Act of Congress (12 ▇.▇.▇. ▇▇▇ ▇▇▇ ▇▇
▇.▇.▇. ▇▇▇, as amended) the Comptroller of the Currency has issued Regulation 9,
as amended, dealing, in part, with the Fiduciary Powers of National Banks, said
regulation providing in subparagraph 9.7 (a) (1-2):
(1) The board of directors is responsible for the proper exercise of
fiduciary powers by the Bank. All matters pertinent thereto,
including the determination of policies, the investment and
disposition of property held in fiduciary capacity, and the direction
and review of the actions of all officers, employees, and committees
utilized by the Bank in the exercise of its fiduciary powers, are the
responsibility of the board. In discharging this responsibility, the
board of directors may assign, by action duly entered in the minutes,
the administration of such of the Bank's fiduciary powers as it may
consider proper to assign to such director(s), officer(s), employee(s)
or committee(s) as it may designate.
(2) No fiduciary account shall be accepted without the prior approval of
the board, or of the director(s), officer(s), or committee(s) to whom
the board may have designated the performance of that responsibility.
....
6. A Resolution relating to Exercise of Fiduciary Powers was adopted by
the Board of Directors at a meeting held July 26, 1994 at which time there was a
quorum present; said resolution is still in full force and effect and has not
been rescinded. Said resolution is attached hereto as Schedule C and
incorporated herein by reference.
7. A Resolution relating to the Designation of Officers and Employees to
Exercise Fiduciary Powers was adopted by the Trust Policy Committee at a meeting
held February 7, 1996 at which time a quorum was present; said resolution is
still in full force and effect and has not been rescinded. Said resolution is
attached hereto as Schedule D and is incorporated herein by reference.
8. Attached hereto as Schedule E and incorporated herein by reference, is
a listing of facsimile signatures of persons authorized (herein "Authorized
Signatory or Signatories") on behalf of the Association and its Trust Group to
act in exercise of its fiduciary powers subject to the resolutions in Paragraphs
6 and 7, above.
9. The principal office of the First Security Bank, National Association,
Trust Group and of its departments, except for the St. ▇▇▇▇▇▇, Utah, Ogden,
Utah, and Provo, Utah, branch offices, is located at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ and all records relating to fiduciary accounts are located
at such principal office of the Trust Group or in storage facilities within Salt
Lake County, Utah, except for those of the Ogden, Utah, St. ▇▇▇▇▇▇, Utah, and
Provo, Utah, branch offices, which are located at said office.
10. Each Authorized Signatory (i) is a duly elected or appointed, duly
qualified officer or employee of the Association; (ii) holds the office or job
title set forth below his or her name on the date hereof; (iii) and the
facsimile signature appearing opposite the name of each such officer or employee
is a true replica of his or her signature.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the
Association this __________ day of _________________, ______.
(SEAL)
__________________________________
R. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Senior Vice President
Assistant Secretary
Schedule A
----------
Articles of Association
Schedule B
----------
Bylaws
Schedule C
----------
Resolution Relating to
Exercise of Fiduciary Powers
Schedule D
----------
Resolution Relating to the
Designation of Officers and Employees
To Exercise Fiduciary Powers
Schedule E
----------
Authorized Signatory or Signatories
EXHIBIT H
---------
[Owner Trustee's Outside Counsel Opinion]
(Pursuant to Section 6.2(f) of the
Participation Agreement)
__________ __, 1999
TO THOSE ON THE ATTACHED DISTRIBUTION LIST
RE: AMENDED AND RESTATED TRUST AGREEMENT DATED AS OF SEPTEMBER 3, 1999
Dear Sirs:
We have acted as special counsel for First Security Bank, National Association,
a national banking association, in its individual capacity ("FSB") and in its
capacity as trustee (the "Owner Trustee") under the Amended and Restated Trust
Agreement dated as of September 3, 1999 (the "Trust Agreement") by and among it
and the Holders, in connection with the execution and delivery by the Owner
Trustee of the Operative Agreements to which it is a party. Except as otherwise
defined herein, the terms used herein shall have the meanings set forth in
Appendix A to the Participation Agreement (Capital One Services, Inc.) dated as
of September 3, 1999 among Capital One Services, Inc., as Lessee and as
Construction Agent, Capital One Financial Corporation, as guarantor (the
"Guarantor"), the Owner Trustee, the various banks and other lending
---------
institutions which are parties thereto from time to time, as holders (the
"Holders"), the various banks and other lending institutions which are parties
-------
thereto from time to time, as lenders (the "Lenders") and Bank of America, N.A.,
as Administrative Agent for the Lenders and respecting the Security Documents,
as Administrative Agent for the Lenders and the Holders, to the extent of their
interests (the "Agent").
-----
We have examined originals or copies, certified or otherwise identified to our
satisfaction, of such documents, corporate records and other instruments as we
have deemed necessary or advisable for the purpose of rendering this opinion.
Based upon the foregoing, we are of the opinion that:
1. FSB is a national banking association duly organized, validly existing
and in good standing under the laws of United States of America and each of
FSB and the Owner Trustee has under the laws of the State of Utah and
federal banking law the power and authority to enter into and perform its
obligations under the Trust Agreement and each other Operative Agreement to
which it is a party.
2. The Owner Trustee is the duly-appointed trustee under the Trust
Agreement.
3. The Trust Agreement has been duly authorized, executed and delivered
by one of the officers of FSB and, assuming due authorization, execution
and delivery by the Holders, is a legal, valid and binding obligation of
the Owner Trustee (and to the extent set forth therein, against FSB),
enforceable against the Owner Trustee (and to the extent set forth therein,
against FSB) in accordance with its terms, and the Trust Agreement creates
under the laws of the State of Utah for the Holders the beneficial interest
in the COSI Trust Estate it purports to create and is a valid trust under
the laws of the State of Utah.
4. The Operative Agreements to which it is party have been duly
authorized, executed and delivered by FSB, and, assuming due authorization,
execution and delivery by the other parties thereto, are legal, valid and
binding obligations of FSB, enforceable against FSB in accordance with
their respective terms.
5. The Operative Agreements to which it is party have been duly
authorized, executed and delivered by the Owner Trustee, and, assuming due
authorization, execution and delivery by the other parties thereto, are
legal, valid and binding obligations of the Owner Trustee, enforceable
against the Owner Trustee in accordance with their respective terms. The
Notes and the Certificates have been duly issued, executed and delivered by
the Owner Trustee, pursuant to authorization contained in the Trust
Agreement, and the Certificates are entitled to the benefits and security
afforded by the Trust Agreement in accordance with its terms and the terms
of the Trust Agreement.
6. The execution and delivery by each of FSB and the Owner Trustee of the
Trust Agreement and the Operative Agreements to which it is a party, and
compliance by FSB or Owner Trustee, as the case may be, with all of the
provisions thereof do not and will not contravene any Laws applicable to or
binding on FSB, or as Owner Trustee, or contravene the provisions of, or
constitute a default under, its charter documents or by-laws or, to our
knowledge after due inquiry, any indenture, mortgage contract or other
agreement or instrument to which FSB or Owner Trustee is a party or by
which it or any of its property may be bound or affected.
7. The execution and delivery of the Operative Agreements by each of FSB
and the Owner Trustee and the performance by each of FSB and the Owner
Trustee of their respective obligations thereunder does not require on or
prior to the date hereof the consent or approval of, the giving of notice
to, the registration or filing with, or the taking of any action in respect
of any Governmental Authority or any court.
8. Assuming that the trust created by the Trust Agreement is treated as a
grantor trust for federal income tax purposes within the contemplation of
Section 671 through 678 of the Internal Revenue Code of 1986, there are no
fees, taxes, or other charges (except taxes imposed on fees payable to the
Owner Trustee) payable to the State of Utah or any political subdivision
thereof in connection with the execution, delivery or performance by the
Owner Trustee, the Agent, the Lenders, the Lessee or the Holders, as the
case may be, of the
Operative Agreements or in connection with the acquisition of any Property
by the Owner Trustee or in connection with the making by any Holder of its
investment in the Trust or its acquisition of the beneficial interest in
the COSI Trust Estate or in connection with the issuance and acquisition of
the Certificate, or the Notes, and neither the Owner Trustee, the COSI
Trust Estate nor the trust created by the Trust Agreement will be subject
to any fee, tax or other governmental charge (except taxes on fees payable
to the Owner Trustee) under the laws of the State of Utah or any political
subdivision thereof on, based on or measured by, directly or indirectly,
the gross receipts, net income or value of the COSI Trust Estate by reason
of the creation or continued existence of the trust under the terms of the
Trust Agreement pursuant to the laws of the State of Utah or the Owner
Trustee's performance of its duties under the Trust Agreement.
9. There is no fee, tax or other governmental charge under the laws of
the State of Utah or any political subdivision thereof in existence on the
date hereof on, based on or measured by any payments under the
Certificates, Notes or the beneficial interests in the COSI Trust Estate,
by reason of the creation of the trust under the Trust Agreement pursuant
to the laws of the State of Utah or the Owner Trustee's performance of its
duties under the Trust Agreement within the State of Utah.
10. Upon the filing of the financing statement on form UCC-1 in the form
attached hereto as Exhibit A with the _____________, the Administrative
Agent's security interest in the COSI Trust Estate, for the benefit of the
Lenders, will be perfected, to the extent that such perfection is governed
by Article 9 of the Uniform Commercial Code as in effect in the State of
Utah (the "Utah UCC").
Your attention is directed to the Utah UCC, which provides, in part, that a
filed financing statement which does not state a maturity date or which states a
maturity date of more than five years is effective only for a period of five
years from the date of filing, unless within six months prior to the expiration
of said period a continuation statement is filed in the same office or offices
in which the original statement was filed. The continuation statement must be
signed by the secured party, identify the original statement by file number and
state that the original statement is still effective. Upon the timely filing of
a continuation statement, the effectiveness of the original financing statement
is continued for five years after the last date to which the original statement
was effective. Succeeding continuation statements may be filed in the same
manner to continue the effectiveness of the original statement.
The opinions set forth in paragraphs 3 and 4 above are subject to the
qualification that enforceability of the Trust Agreement and the other Operative
Agreements to which the Owner Trustee is a party, in accordance with their
respective terms, may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting enforcement of creditors' rights generally.
We are attorneys admitted to practice in the State of Utah and in rendering the
foregoing opinions we have not passed upon, or purported to pass upon, the laws
of any jurisdictions other than the State of Utah and the federal banking law
governing the banking and trust powers of FSB.
This opinion is for the sole benefit of Capital One Services, Inc., Capital One
Financial Corporation, Bank of America, N.A., as the Administrative Agent, the
Lenders, the Holders, FSB, not individually, but solely as Owner Trustee under
the Capital One Realty Trust 1998-1 and their respective successors and assigns
and may not be relied upon by any other person other than such parties and their
respective successors and assigns without the express written consent of the
undersigned. The opinions expressed herein are as of the date hereof and we
make no undertaking to amend or supplement such opinions if facts come to our
attention or changes in the current law of the jurisdictions mentioned herein
occur which could affect such opinions.
Very truly yours,
RAY, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
M. ▇▇▇▇ ▇▇▇▇▇▇
Distribution List
-----------------
Bank of America, N.A., as Administrative Agent
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as Holders
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as Lenders
Capital One Services, Inc., as the Lessee and as the Construction Agent
Capital One Financial Corporation, as Guarantor
First Security Bank, National Association, not individually, but solely as Owner
Trustee under the Capital One Realty Trust 1998-1
EXHIBIT I
---------
[Description of Material Litigation]
In connection with the transfer of substantially all of Signet Bank's
credit card business to Capital One Bank in November 1994, Capital One Financial
Corporation and Capital One Bank agreed to indemnify Signet Bank (which has
since been acquired by First Union Bank on November 30, 1997) for certain
liabilities incurred in litigation arising from that business, which may include
liabilities, if any, incurred in the purported class action case described
below.
During 1995, Capital One Financial Corporation and Capital One Bank became
involved in a purported class action suit relating to certain collection
practices engaged in by Signet Bank and, subsequently, by Capital One Bank. The
complaint in this case alleges that Signet Bank and/or Capital One Bank violated
a variety of California state statutes and constitutional and common law duties
by filing collection lawsuits, obtaining judgments and pursuing garnishment
proceedings in the Virginia state courts against defaulted credit card customers
who were not residents of Virginia. This case was filed in the Superior Court
of California in the County of Alameda, Southern Division, on behalf of a class
of California residents. The complaint in this case seeks unspecified statutory
damages, compensatory damages, punitive damages, restitution, attorneys' fees
and costs, a permanent injunction and other equitable relief.
In early 1997, the California court entered judgment in favor of Capital
One Bank on all of the plaintiffs' claims. The plaintiffs appealed the ruling
to the California Court of Appeal First Appellate District Division 4. In early
1999, the Court of Appeals affirmed the trial court's ruling in favor of Capital
One Bank on six counts, but reversed the trial court's ruling on two counts of
the plaintiffs' complaint. The California Supreme Court rejected Capital One
Bank's Petition for Review of the remaining two counts and remitted them to the
trial court. The Bank intends to petition for further appellate review of the
ruling on the two remaining counts.
Because no specific measure of damages is demanded in the complaint of the
California case and the trial court entered judgment in favor of Capital One
Bank before the parties completed any significant discovery, an informed
assessment of the ultimate outcome of this case cannot be made at this time.
Management believes, however, that there are meritorious defenses to this
lawsuit and intends to continue to defend it vigorously.
Capital One Financial Corporation is commonly subject to various other
pending and threatened legal actions arising from the conduct of its normal
business activities. In the opinion of management, the ultimate aggregate
liability, if any, arising out of any pending or threatened action will not have
a material adverse effect on the consolidated financial condition of Capital One
Financial Corporation. At the present time, however, management is not in a
position to determine whether the resolution of pending or threatened litigation
will have a material effect on Capital One Financial Corporation's results of
operations in any future reporting period.
1
EXHIBIT J
---------
[Form of Confidentiality Agreement]
______________, 1999
[Address]
Attention:
Re: Confidentiality Agreement
-------------------------
Dear __________________:
In the course of further discussions between you and Capital One Financial
Corporation and/or any one or more of its subsidiaries or affiliates
(individually and collectively, "Capital One"), you may be supplied with
materials and information concerning Capital One and its subsidiaries or
affiliates and our business, which information is non-public, confidential or
proprietary in nature ("Confidential Information"). Because the use or
disclosure of such Confidential Information would be damaging to Capital One,
Capital One is willing to supply you with such information only if you agree to
the conditions set forth in this confidentiality agreement (this "Agreement").
1. The Transaction. The services you are contemplating providing to
---------------
Capital One are in connection with those certain Participation Agreements dated
as of September 3, 1999 (together, the "Participation Agreement"), among (i)
Capital One Reality, Inc., as Construction Agent and Lessee, Capital One Bank,
as Guarantor, First Security Bank, National Association, as Owner Trustee, the
Holders named therein and the Lenders named therein and (ii) Capital One
Services, Inc., as Construction Agent and Lessee, Capital One Financial
Corporation, as Guarantor, First Security Bank, National Association, as Owner
Trustee, the Holders named therein and the Lenders named therein (the
"Transaction"). Terms used herein but not defined herein have the meanings set
forth in the respective Participation Agreements.
2. Description of Information. Confidential Information includes
--------------------------
without limitation (i) information transmitted in written, oral, magnetic or any
other medium, and (ii) all copies and reproductions, in whole or in part, of
such information and (iii) all summaries, analyses, compilations, studies, notes
or other records which contain, reflect, or are generated from such information.
Confidential Information does not include information that (w) has become part
of the public domain through no act or omission of you; (x) was lawfully
disclosed
J-1
to you without restriction on disclosure by a third party; (y) was developed
independently by you; or (z) is or was lawfully and independently provided to
you prior to disclosure hereunder, from a third party who is not subject to an
obligation of confidentiality or otherwise prohibited from transmitting such
information.
3. Nondisclosure of Information. You agree that you will use the
----------------------------
Confidential Information solely for the purpose of the Transaction and, except
as provided in paragraph 7 hereof, agree to reveal the Confidential Information
only to your affiliates, subsidiaries, directors, officers, employees and agents
(collectively "Affiliates") with a need to know the Confidential Information for
the purpose of the Transaction. Except as provided in paragraph 7 hereof, you
agree not to disclose to any third party any of the Confidential Information now
or hereafter received or obtained by you without our prior written consent;
provided, however, that you may disclose any such Confidential Information to
your respective accountants, attorneys and other confidential advisors
(collectively "Advisors") who need to know such information for the purpose of
assisting you in connection with the Transaction. You agree to be responsible
for any breach of this Agreement by your Affiliates and Advisors, and you agree
that your Affiliates and Advisors will be advised by you of the confidential
nature of such information and shall agree to be bound by this Agreement.
4. Nondisclosure of Transaction. Neither you nor your Agents or
----------------------------
Advisors, without our prior written consent, will disclose to any person the
fact that Confidential Information has been provided to you or them, that
discussions or negotiations are taking place with respect to the Transaction, or
the existence, terms, conditions, or other facts of such Transaction, including
the status thereof.
5. Ownership of Information. You acknowledge and agree that any
------------------------
Confidential Information provided to you, in whatever form, is the sole property
of Capital One. Neither you nor your Affiliates or Advisors shall use any of
the Confidential Information now or hereafter received or obtained from Capital
One in furtherance of your business or the business of anyone else whether or
not in competition with Capital One, or for any other purpose whatsoever, other
than as contemplated by the Transaction. You agree that if we should request
that you destroy or return the Confidential Information, you shall return or
destroy such Confidential Information as so directed.
6. Remedies. You acknowledge that all Confidential Information is
--------
considered to be proprietary and of competitive value, and in many instances
trade secrets. You agree that because of the unique nature of the Confidential
Information any breach of this Agreement would cause Capital One irreparable
harm, and money damages and other remedies available at law in the event of a
breach would not be adequate to compensate Capital One for any such breach.
Accordingly, you agree that we shall be entitled, without the requirement of
posting a bond or other security, to equitable relief, including, without
limitation, injunctive relief and specific performance, as a remedy for any such
breach. Such relief shall be in addition to, and not in lieu of, all other
remedies available to us whether at law or in equity.
J-2
7. Compelled Disclosure. If you or any of your Affiliates or
--------------------
Advisors is legally compelled (whether by deposition, interrogatory, request for
documents, subpoena, civil investigation, demand or similar process) to disclose
any of the Confidential Information (including the fact that discussions or
negotiations are taking place with respect to the Transaction) you shall use
your best efforts to notify Capital One in writing of such requirement prior to
disclosure thereof so that we may seek a protective order or other appropriate
remedy and/or waive compliance with the provisions hereof; provided, that you
--------
shall not be subject to any liability whatsoever for any failure to so notify
Capital One.
8. No Waiver of Rights. It is understood and agreed that no failure
-------------------
or delay by Capital One in exercising any right, power or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
right, power or privilege hereunder.
9. No Representations and Warranties. You understand and acknowledge
---------------------------------
that Capital One is not making any representation or warranty, expressed or
implied, as to the accuracy or completeness of the Confidential Information and
we shall not be liable to you or to any other person resulting from the use of
the Confidential Information. Only those representations or warranties that are
made in any definitive agreement executed in connection with the Transaction,
and subject to any limitations and restrictions as may be specified in such
definitive agreement, shall have any legal effect.
10. Indemnification; Expenses. You agree to indemnify Capital One
-------------------------
for any and all losses, liabilities, obligations, damages, penalties, judgments,
suits, costs, expenses or disbursements of any kind (including, without
limitation, attorneys' fees and expenses) arising out of, or incurred by us, as
the result of a violation, breach or non-performance by you of any of the terms
of this Agreement.
11. Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the laws of the Commonwealth of Virginia, shall be binding
upon you and your successors and assigns, and shall inure to the benefit of the
Capital One and its successors and assigns.
12. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be an original, but which together shall
constitute one and the same instrument.
13. Facsimile Signatures. This Agreement may be executed and
--------------------
delivered by facsimile. Any facsimile signatures shall have the same legal
effect as manual signatures.
14. Term. This Agreement shall terminate on the date definitive
----
documentation is executed by you and any other appropriate parties in connection
with the Transaction.
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PLEASE ACKNOWLEDGE YOUR ACCEPTANCE OF THIS AGREEMENT, INCLUDING YOUR
AGREEMENT TO HOLD ALL MATTERS STRICTLY CONFIDENTIAL AS DISCUSSED HEREIN, BY
SIGNING IN THE SPACE PROVIDED BELOW.
Very truly yours,
CAPITAL ONE FINANCIAL CORPORATION
By:___________________________
Name:_________________________
Title:________________________
ACCEPTED AND AGREED TO AS OF THIS ___
DAY OF ____________, 1999
By:__________________________
J-4
--------------------------------------------------------------------------------
Appendix A
Rules of Usage and Definitions
--------------------------------------------------------------------------------
Rules of Usage
The following rules of usage shall apply to this Appendix A and the
Operative Agreements (and each appendix, schedule, exhibit and annex to the
foregoing) unless otherwise required by the context or unless otherwise defined
therein:
(a) Except as otherwise expressly provided, any definitions set forth
herein or in any other document shall be equally applicable to the singular
and plural forms of the terms defined.
(b) Except as otherwise expressly provided, references in any
document to articles, sections, paragraphs, clauses, annexes, appendices,
schedules or exhibits are references to articles, sections, paragraphs,
clauses, annexes, appendices, schedules or exhibits in or to such document.
(c) The headings, subheadings and table of contents used in any
document are solely for convenience of reference and shall not constitute a
part of any such document nor shall they affect the meaning, construction
or effect of any provision thereof.
(d) References to any Person shall include such Person, its
successors and permitted assigns and transferees.
(e) Except as otherwise expressly provided, reference to any
agreement means such agreement as amended, modified, extended,
supplemented, restated and/or replaced from time to time in accordance with
the applicable provisions thereof.
(f) Except as otherwise expressly provided, references to any law
includes any amendment or modification to such law and any rules or
regulations issued thereunder or any law enacted in substitution or
replacement therefor.
(g) When used in any document, words such as "hereunder", "hereto",
"hereof" and "herein" and other words of like import shall, unless the
context clearly indicates to the contrary, refer to the whole of the
applicable document and not to any particular article, section, subsection,
paragraph or clause thereof.
Appendix - 1
(h) References to "including" means including without limiting the
generality of any description preceding such term and for purposes hereof
the rule of ejusdem generis shall not be applicable to limit a general
statement, followed by or referable to an enumeration of specific matters,
to matters similar to those specifically mentioned.
(i) References herein to "attorney's fees", "legal fees", "costs of
counsel" or other such references shall be deemed to include the allocated
cost of in-house counsel.
(j) Each of the parties to the Operative Agreements and their counsel
have reviewed and revised, or requested revisions to, the Operative
Agreements, and the usual rule of construction that any ambiguities are to
be resolved against the drafting party shall be inapplicable in the
construing and interpretation of the Operative Agreements and any
amendments or exhibits thereto.
(k) Capitalized terms used in any Operative Agreements which are not
defined in this Appendix A but are defined in another Operative Agreement
----------
shall have the meaning so ascribed to such term in the applicable Operative
Agreement.
Definitions
"ABR" shall mean, for any day, a rate per annum equal to the greater of (a)
the Prime Lending Rate in effect on such day, and (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. For purposes hereof:
"Prime Lending Rate" shall mean the rate which the Administrative Agent
------------------
announces from time to time as its prime lending rate as in effect from time to
time. The Prime Lending Rate is a reference rate and does not necessarily
represent the lowest or best rate actually charged to any customer. Any Lender
may make commercial loans or other loans at rates of interest at, above or below
the Prime Lending Rate. The Prime Lending Rate shall change automatically and
without notice from time to time as and when the prime lending rate of the
Administrative Agent changes. "Federal Funds Effective Rate" shall mean, for
----------------------------
any period, a fluctuating interest rate per annum equal for each day during such
period to the weighted average of the rates on overnight Federal funds
transactions with members or the Federal Reserve System arranged by Federal
funds brokers, as published for such day (or, if such day is not a Business Day,
for the next preceding Business Day) by the Federal Reserve Bank of New York,
or, if such rate is not so published for any day which is a Business Day, the
average of the quotations for such day on such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by it. Any change in the ABR due to a change in the Prime Lending Rate
or the Federal Funds Effective Rate shall be effective as of the opening of
business on the effective day of such change in the Prime Lending Rate or the
Federal Funds Effective Rate, respectively.
"ABR Holder Funding" shall mean a Holder Funding bearing a Holder Yield
based on the ABR.
Appendix - 2
"ABR Loans" shall mean Loans the rate of interest applicable to which is
based upon the ABR.
"Acceleration" shall have the meaning given to such term in Section 6 of
the Credit Agreement.
"acquire" or "purchase" shall mean, with respect to any Property, the
acquisition or purchase of such Property by the Lessor from any Person.
"Acquisition Advance" shall have the meaning given to such term in Section
5.3 of the Participation Agreement.
"Administration Fee" shall mean a construction administration fee payable
to the Agent pursuant to Section 9.5 of the Participation Agreement.
"Advance" shall mean a Construction Advance or an Acquisition Advance.
"Affiliate" shall mean, with respect to any Person, any Person or group
acting in concert in respect of the Person in question that, directly or
indirectly, controls or is controlled by or is under common control with such
Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlled by" and "under common control with")
shall mean the possession, directly or indirectly, of the power to direct or
cause the direction of management and policies of a Person, whether through the
ownership of voting securities or by contract or otherwise.
"After Tax Basis" shall mean, 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 calculated at the then maximum
marginal rates generally applicable to Persons of the same type as the
recipients (less any tax savings realized 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.
"Agency Agreement" shall mean the Agency Agreement (Capital One Services,
Inc.), dated as of the Initial Closing Date between the Construction Agent and
the Lessor.
"Agency Agreement Event of Default" shall mean an "Event of Default" as
defined in Section 5.1 of the Agency Agreement.
"Agent" or "Administrative Agent" shall mean Bank of America, N.A., as
Administrative Agent for the Lenders pursuant to the Credit Agreement, or any
successor agent appointed in accordance with the terms of the Credit Agreement
and respecting the Security Documents, for the Lenders and the Holders, to the
extent of their interests.
Appendix - 3
"Applicable Percentage" shall mean with respect to the applicable Level
Status, the applicable rate per annum set forth opposite such Level Status:
========================================================================================================
Applicable Percentage Applicable Percentage
Level Status for for
Eurodollar Loans Facility Fee
--------------------------------------------------------------------------------------------------------
Level I Status .375% .125%
--------------------------------------------------------------------------------------------------------
Level II Status .55% .15%
--------------------------------------------------------------------------------------------------------
Level III Status .675% .175%
--------------------------------------------------------------------------------------------------------
Level IV Status 1.10% .25%
--------------------------------------------------------------------------------------------------------
Level V Status 1.725% .375%
--------------------------------------------------------------------------------------------------------
========================================================================================================
Changes in the Applicable Percentage resulting from changes in the Debt Rating
shall become effective on the date on which such Debt Rating is announced to the
public by S&P, ▇▇▇▇▇'▇ or Fitch, as applicable, and shall remain in effect until
the next change in such Debt Rating; provided, that, until the effectiveness of
--------
any change in the Applicable Percentage based upon a Debt Rating announced after
the Initial Closing Date, Level III Status shall apply.
"Appraisal" shall mean, with respect to any Property, an appraisal to be
delivered in connection with the Participation Agreement or in accordance with
the terms of the Lease, in each case prepared by a reputable appraiser
reasonably acceptable to the Agent, which in the judgment of counsel to the
Agent, complies 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 Legal Requirements.
"Appraisal Procedure" shall have the meaning given such term in Section
22.4 of the Lease.
"Approved State" means Florida, Washington and any other state within the
continental United States proposed by the Lessee and consented to in writing by
the Agent.
"Appurtenant Rights" shall mean (i) all agreements, easements, rights of
way or use, rights of ingress or egress, privileges, appurtenances, tenements,
hereditaments and other rights and benefits at any time belonging or pertaining
to the Land underlying the Improvements or the Improvements, including, without
limitation, the use of any streets, ways, alleys, vaults or strips of land
adjoining, abutting, adjacent or contiguous to the Land and (ii) all permits,
licenses and rights, whether or not of record, appurtenant to such Land or the
Improvements.
"Assignment and Acceptance" shall mean the Assignment and Acceptance in the
form attached to the Credit Agreement as Exhibit B.
---------
Appendix - 4
"Available Commitment" shall mean, as to any Lender at any time, an amount
equal to the excess, if any, of (a) the amount of such Lender's Commitment over
(b) the aggregate principal amount of all Loans made by such Lender as of such
date after giving effect to any repayments pursuant to Section 5.2(d) of the
Participation Agreement (but without giving effect to any other repayments or
prepayments of any Loans hereunder).
"Available Holder Commitments" shall mean an amount equal to the excess, if
any, of (i) the amount of the Holder Commitments over (ii) the aggregate amount
of the Holder Fundings made since the Initial Closing Date after giving effect
to any repayments pursuant to Section 5.2(d) of the Participation Agreement (but
without giving effect to any other repayments or prepayments of any Holder
Fundings).
"Bankruptcy Code" shall mean Title 11 of the U. S. Code entitled
"Bankruptcy," as now or hereafter in effect or any successor thereto.
"Basic Rent" shall mean, the sum of (i) the Loan Basic Rent and (ii) the
Lessor Basic Rent, calculated as of the applicable date on which Basic Rent is
due.
"Basic Term" shall have the meaning specified in Section 2.2 of the Lease.
"Basic Term Commencement Date" shall have the meaning specified in the
recitals to of the Lease.
"Basic Term Expiration Date" shall have the meaning specified in Section
2.2 of the Lease.
"▇▇▇▇ of Sale" shall mean a ▇▇▇▇ of Sale regarding Equipment in form and
substance satisfactory to the Holders, the Agent and the Owner Trustee.
"Board" shall mean the Board of Governors of the Federal Reserve System of
the United States (or any successor).
"Borrowing Date" shall mean any Business Day specified in a notice
delivered pursuant to Section 2.3 of the Credit Agreement as a date on which the
Lessor requests the Lenders to make Loans hereunder.
"Budgeted Total Loan Property Cost" shall mean, at any date of
determination with respect to any Construction Period Property, an amount equal
to the aggregate amount which the Construction Agent in good faith expects to be
expended in order to achieve Completion with respect to such Property, including
interest on Loans and yield on Holder Fundings through the Basic Term
Commencement Date respecting such Construction Period Property.
"Business Day" shall mean a day other than a Saturday, Sunday or other day
on which commercial banks in Dallas, Texas or New York, New York are authorized
or required by law to close; provided, however, that when used in connection
-------- -------
with a Eurodollar Loan, the term "Business
Appendix - 5
Day" shall also exclude any day on which banks are not open for dealings in
dollar deposits in the London interbank market.
"Capital One Bank" shall mean Capital One Bank, a Virginia banking
corporation, and its successors and permitted assigns.
"Capital One Credit Agreement" shall have the meaning given such term in
Section 28.1 of the Lease.
"Capital One Credit Agreement Event of Default" shall mean the Event of
Default under Section 9 of the Capital One Credit Agreement.
"Capitalized Lease" shall mean, as applied to any Person, any lease of
property (whether real, personal, tangible, intangible or mixed of such Person)
by such Person as lessee which would be capitalized on a balance sheet of such
Person prepared in accordance with GAAP.
"Casualty" shall mean any damage or destruction of all or any portion of
the Property as a result of a fire or other casualty.
"CERCLA" shall mean the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, 42 U.S.C. (S)(S) 9601 et seq., as amended by the
Superfund Amendments and Reauthorization Act of 1986.
"Certificate" shall mean a Certificate (Capital One Services, Inc.) in
favor of each Holder regarding the Holder Commitment of such Holder issued
pursuant to the terms and conditions of the Trust Agreement in favor of each
Holder.
"Claims" shall mean any and all obligations, liabilities, losses, actions,
suits, penalties, claims, demands, costs and expenses (including, without
limitation, reasonable attorney's fees and expenses) of any nature whatsoever.
"Closing Date" shall mean the Initial Closing Date and each Property
Closing Date.
"Capital One Realty Trust 1998-1" shall mean the grantor trust created
pursuant to the terms and conditions of the Trust Agreement.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time, or any successor statute hereto.
"COFC" shall mean Capital One Financial Corporation, a Delaware
corporation, and its successors and assigns.
"Collateral" shall mean all assets of the Lessor, now owned or hereafter
acquired, upon which a lien is purported to be created by the Security
Documents.
Appendix - 6
"Commitment" shall mean, as to any Lender, the obligation of such Lender to
make the portion of the Loans to the Lessor in an aggregate principal amount at
any time outstanding not to exceed the amount set forth opposite such Lender's
name on Schedule 1.1 of the Credit Agreement, as such amount may be increased or
reduced from time to time in accordance with the provisions of the Credit
Agreement.
"Commitment Percentage" shall mean, as to any Lender at any time, the
percentage which such Lender's Commitment then constitutes of the aggregate
Commitments (or, at any time after the Commitments shall have expired or
terminated, the percentage which the aggregate principal amount of such Lender's
Loans then outstanding constitutes of the aggregate principal amount of all of
the Loans then outstanding), and such Commitment Percentage shall take into
account both the Lender's Tranche A Commitment and the Lender's Tranche B
Commitment.
"Commitment Period" shall mean the period from and including the Initial
Closing Date to and including the Construction Period Termination Date, or such
earlier date as the Commitments shall terminate as provided in the Credit
Agreement.
"Company Obligations" shall mean the obligations of ▇▇▇▇, in any and all
capacities under and with respect to the Operative Agreements and each Property.
"Completion" shall mean, with respect to a Property, such time as
substantial completion of the Improvements on such Property has been achieved in
accordance with the Plans and Specifications, the Agency Agreement and/or the
Lease, and in compliance with all material Legal Requirements and Insurance
Requirements and a certificate of occupancy has been issued with respect to such
Property by the appropriate governmental entity. If the Lessor purchases a
Property that includes existing Improvements that are to be immediately occupied
by the Lessee, the date of Completion for such Property shall be the Property
Closing Date.
"Completion Date" shall mean, with respect to a Property, the date on which
Completion for such Property has occurred.
"Condemnation" shall mean any 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, any Property
or alter the pedestrian or vehicular traffic flow to any Property so as to
result in a 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.
"Contractor" shall mean each entity with whom the Construction Agent or the
Lessee contracts to construct any Improvements or any portion thereof on the
Property.
"Construction Advance" shall mean an advance of funds to pay Property Costs
pursuant to Section 5.4 of the Participation Agreement.
Appendix - 7
"Construction Agent" shall mean Capital One Services, Inc., a Delaware
corporation, as construction agent under the Agency Agreement.
"Construction Agent Options" shall have the meaning given to such term in
Section 2.1(c) of the Agency Agreement.
"Construction Budget" shall mean the cost of constructing and developing
any Improvements as determined by the Construction Agent in its reasonable, good
faith judgment.
"Construction Commencement Date" shall mean, with respect to Improvements,
the date on which construction of such Improvements commences pursuant to the
Agency Agreement.
"Construction Contract" shall mean any contract entered into between the
Construction Agent or the Lessee with a Contractor for the construction of
Improvements or any portion thereof on the Property.
"Construction Loan" shall mean any Loan made in connection with a
Construction Advance, including Loans to pay interest thereon.
"Construction Loan Property Cost" shall mean with respect to each
Construction Period Property at the date of determination, an amount equal to
(a) the aggregate principal amount of Construction Loans made on or prior to
such date with respect to the Property minus (b) the aggregate principal amount
-----
of prepayments or repayments of the Loans allocated to reduce the Construction
Loan Property Cost of such Property pursuant to Section 2.6(c) of the Credit
Agreement.
"Construction Period" shall mean, with respect to a Property, the period
commencing on the Construction Commencement Date for such Property and ending on
the Completion Date for such Property.
"Construction Period Property" means, at any date of determination, any
Property as to which the Basic Term has not commenced on or prior to such date.
"Construction Period Termination Date" shall mean the earlier of (i) the
date that the Commitments have been terminated in their entirety in accordance
with the terms of Section 2.5(a) of the Credit Agreement, or (ii) the third
anniversary of the Initial Closing Date.
"Contingent Obligation" shall mean, as applied to any Person, any
agreement, undertaking or arrangement by which such Person assumes, guarantees,
endorses, contingently agrees to purchase or provide funds for the payment of,
or otherwise becomes or is contingently liable upon, the obligation or liability
of any other Person or agrees to maintain the net worth or working capital or
other financial condition of any other Person, or otherwise assures any creditor
of such other Person against loss, including, without limitation, any comfort
letter, operating agreement, take-or-pay contract or application for a letter of
credit (or similar instrument which is issued upon the
Appendix - 8
application of such Person or upon which such Person becomes an account party or
for which such Person is in any way liable), but excluding the endorsement of
instruments for deposit or collection in the ordinary course of business.
"Control" shall mean (including the correlative meanings of the terms
"controlled by" and "under common control with"), as used with respect to any
Person, the possession directly or indirectly, of the power to direct or cause
the direction of the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise.
"Co-Owner Trustee" shall have the meaning specified in Section 9.2 of the
Trust Agreement.
"▇▇▇▇" shall mean Capital One Realty, Inc., a Delaware corporation, and its
successors and permitted assigns.
"▇▇▇▇ Participation Agreement" shall have the meaning given to such term in
Section 1.1 of the Trust Agreement.
"▇▇▇▇ Trust Estate" shall have the meaning given to such term in Section
2.2 of the Trust Agreement.
"COSI" shall mean Capital One Services, Inc., a Delaware corporation, and
its successors and permitted assigns.
"COSI Participation Agreement" shall have the meaning given to such term in
Section 1.1 of the Trust Agreement.
"COSI Trust Estate" shall have the meaning given to such term in Section
2.2 of the Trust Agreement.
"Credit Agreement" shall mean the Credit Agreement (Capital One Services,
Inc.), dated as of the Initial Closing Date, among the Lessor, the Agent and the
Lenders, as specified therein.
"Credit Agreement Default" shall mean any event or condition which, with
the lapse of time or the giving of notice, or both, would constitute a Credit
Agreement Event of Default.
"Credit Agreement Event of Default" shall mean any event or condition
defined as an "Event of Default" in Section 6 of the Credit Agreement.
"Credit Documents" shall mean the Credit Agreement, the Notes and the
Security Documents.
"Credit Parties" shall mean the Lessee and the Guarantor.
Appendix - 9
"Debt Rating" shall mean, as of any date of determination thereof, the
ratings most recently published by the Rating Agencies relating to the
unsecured, unsupported senior long-term debt obligations of the Guarantor.
"Deed" shall mean a warranty deed regarding the Land and/or Improvements in
form and substance satisfactory to the Holders, the Agent and the Owner Trustee.
"Default" shall mean any event, act or condition which with notice or lapse
of time, or both, would constitute an Event of Default.
"Defaulting Lender" shall have the meaning given to such term in Section
9.1 of the Credit Agreement.
"Dollars" and "$" shall mean dollars in lawful currency of the United
States of America.
"Election Notice" shall have the meaning given to such term in Section 20.1
of the Lease.
"Employee Benefit Plan" or "Plan" shall mean an employee benefit plan
(within the meaning of Section 3(3) of ERISA, including any Multiemployer Plan),
or any "plan" as defined in Section 4975(e)(1) of the Code and as interpreted by
the Internal Revenue Service and the Department of Labor in rules, regulations,
releases or bulletins in effect on any Closing Date.
"Environmental Claims" shall mean any investigation, notice, violation,
demand, allegation, action, suit, injunction, judgment, order, consent decree,
penalty, fine, lien, proceeding, or claim (whether administrative, judicial, or
private in nature) arising (a) pursuant to, or in connection with, an actual or
alleged violation of, any Environmental Law, (b) in connection with any
Hazardous Substance, (c) from any abatement, removal, remedial, corrective, or
other response action in connection with a Hazardous Substance, Environmental
Law, or other order of a Tribunal or (d) from any actual or alleged damage,
injury, threat, or harm to health, safety, natural resources, or the
environment.
"Environmental Laws" shall mean any Law, permit, consent, approval,
license, award, or other authorization or requirement of any Tribunal relating
to emissions, discharges, releases, threatened releases of any Hazardous
Substance into ambient air, surface water, ground water, publicly owned
treatment works, septic system, or land, or otherwise relating to the handling,
storage, treatment, generation, use, or disposal of Hazardous Substances,
pollution or to the protection of health or the environment, including without
limitation CERCLA, the Resource Conservation and Recovery Act, 42 U.S.C. (S)
6901, et seq., and state statutes analogous thereto.
"Environmental Violation" shall mean any activity, occurrence or condition
that violates or threatens (if the threat requires remediation under any
Environmental Law and is not remediated during any grace period allowed under
such Environmental Law) to violate or results in or threatens (if the threat
requires remediation under any Environmental Law and is not remediated during
any grace period allowed under such Environmental Law) to result in
noncompliance with any Environmental Law.
Appendiix - 10
"Equipment" shall mean equipment, apparatus, furnishings, fittings and
personal property of every kind and nature whatsoever purchased, leased or
otherwise acquired using the proceeds of the Loans or the Holder Fundings by the
Construction Agent, the Lessee or the Lessor as specified or described in either
a requisition or a Lease Supplement, whether or not now or subsequently attached
to, contained in or used or usable in any way in connection with any operation
of any Improvements or other improvements to real property, including but
without limiting the generality of the foregoing, all equipment described in the
Appraisal including, without limitation, all heating, electrical, and mechanical
equipment, lighting, switchboards, plumbing, ventilation, air conditioning and
air-cooling apparatus, refrigerating, and incinerating equipment, escalators,
elevators, loading and unloading equipment and systems, cleaning systems
(including window cleaning apparatus), telephones, communication systems
(including satellite dishes and antennae), televisions, computers, sprinkler
systems and other fire prevention and extinguishing apparatus and materials,
security systems, motors, engines, machinery, pipes, pumps, tanks, conduits,
appliances, fittings and fixtures of every kind and description.
"Equipment Schedule" shall mean (a) each Equipment Schedule attached to the
applicable Requisition and (b) each Equipment Schedule attached to the
applicable Lease Supplement.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Affiliate" shall mean each entity required to be aggregated with the
Construction Agent or any Credit Party pursuant to the requirements of Section
414(b) or (c) of the Code.
"Eurocurrency Reserve Requirements" shall mean for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the maximum rates
(expressed as a decimal fraction) of reserve requirements in effect on such day
(including, without limitation, basic, supplemental, marginal and emergency
reserves under any regulations of the Board or other Governmental Authority
having jurisdiction with respect thereto) dealing with reserve requirements
prescribed or eurocurrency funding (currently referred to as "Eurocurrency
liabilities" in Regulation D) maintained by a member bank of the Federal Reserve
System.
"Eurodollar Holder Funding" shall mean a Holder Funding bearing a Holder
Yield based on the Eurodollar Rate.
"Eurodollar Loans" shall mean Loans the rate of interest applicable to
which is based upon the Eurodollar Rate.
"Eurodollar Rate" shall mean for the Interest Period for each Eurodollar
Loan or Eurodollar Holder Funding comprising part of the same borrowing or
advance (including conversions, extensions and renewals), a per annum interest
rate equal to the per annum rate determined by the Administrative Agent on the
basis of the offered rates for deposits in dollars for a period of time
corresponding to such Interest Period (and commencing on the first day of such
Interest Period), which appear on the Reuters Screen LIBO Page as of 11:00 a.m.
(London time) two (2) Business Days before the first day of such Interest Period
(provided that, if at least two such offered rates
--------
Appendix - 11
appear on the Reuters Screen LIBO Page, the rate in respect of such Interest
Period will be the arithmetic mean of such offered rates). As used herein,
"Reuters Screen LIBO Page" means the display designated as page "LIBO" on the
Reuters Monitor Money Rates Service (or such other page as may replace the LIBO
page on that service for the purpose of displaying London interbank offered
rates of major banks) ("RMMRS"). In the event the RMMRS is not then quoting such
offered rates, "Eurodollar Rate" shall mean for the Interest Period for each
Eurodollar Loan or Eurodollar Holder Funding comprising part of the same
borrowing or advance (including conversions, extensions and renewals), the
average (rounded upward to the nearest one-sixteenth (1/16) of one percent) per
annum rate of interest determined by the office of the Administrative Agent
(each such determination to be conclusive and binding) as of two Business Days
prior to the first day of such Interest Period, as the effective rate at which
deposits in immediately available funds in U.S. dollars are being, have been, or
would be offered or quoted by the Administrative Agent to major banks in the
applicable interbank market for Eurodollar deposits at any time during the
Business Day which is the second Business Day immediately preceding the first
day of such Interest Period, for a term comparable to such Interest Period and
in the amount of the requested Eurodollar Loan and Eurodollar Holder Funding. If
no such offers or quotes are generally available for such amount, then the
Administrative Agent shall be entitled to determine the Eurodollar Rate by
estimating in its reasonable judgment the per annum rate (as described above)
that would be applicable if such quote or offers were generally available.
"Event of Default" shall mean a Lease Event of Default, an Agency Agreement
Event of Default or a Credit Agreement Event of Default.
"Excepted Payments" shall mean: (a) all indemnity payments (including
indemnity payments made pursuant to Section 13 of the Participation Agreement),
whether made by adjustment to Basic Rent or otherwise, to which the Owner
Trustee, any Holder or any of their respective Affiliates, agents, officers,
directors or employees is entitled;
(b) any amounts (other than Basic Rent or Termination Value) payable under
any Operative Agreement to reimburse the Owner Trustee, any Holder or any of
their respective Affiliates (including the reasonable expenses of the Owner
Trustee, the Trust Company and the Holders incurred in connection with any such
payment) for performing or complying with any of the obligations of any Credit
Party under and as permitted by any Operative Agreement;
(c) any amount payable to a Holder by any transferee of such interest of a
Holder as the purchase price of such Holder's interest in the COSI Trust Estate
(or a portion thereof);
(d) any insurance proceeds (or payments with respect to risks self-insured
or policy deductibles) under liability policies other than such proceeds or
payments payable to the Agent or any Lender;
(e) any insurance proceeds under policies maintained by the Owner Trustee
or any Holder;
Appendix - 12
(f) Transaction Expenses or other amounts or expenses paid or payable to or
for the benefit of the Owner Trustee or any Holder;
(g) all right, title and interest of any Holder or the Owner Trustee to any
Property or any portion thereof or any other property to the extent any of the
foregoing has been released from the Liens of the Security Documents and the
Lease pursuant to the terms thereof;
(h) upon termination of the Credit Agreement pursuant to the terms thereof,
all remaining property covered by the Lease or Security Documents;
(i) all payments in respect of the Holder Yield;
(j) any payments in respect of interest to the extent attributable to
payments referred to in clauses (a) through (i) above; and
(k) any rights of either the Owner Trustee or Trust Company to demand,
collect, ▇▇▇ for or otherwise receive and enforce payment of any of the
foregoing amounts, provided that such rights shall not include the right to
terminate the Lease.
"Excepted Rights" shall mean the rights retained by the Owner Trustee
pursuant to Section 8.2(a)(i) of the Credit Agreement.
"Excess Proceeds" shall mean the excess, if any, of the aggregate of all
awards, compensation or insurance proceeds payable in connection with a Casualty
or Condemnation over the Termination Value paid by the Lessee pursuant to the
Lease with respect to such Casualty or Condemnation.
"Exculpated Persons" shall have the meaning given to such term in Section
14.10 of the Participation Agreement.
"Expiration Date" shall mean the later of (i) the Basic Term Expiration
Date and (ii) the last day of the Renewal Term.
"Expiration Date Purchase Option" shall mean the Lessee's option to
purchase all (but not less than all) of the Properties on the Expiration Date.
"Facility" shall mean a facility used for the treatment, storage or
disposal of Hazardous Substances.
"Facility Fee" shall mean that fee payable by the Lessee pursuant to
Section 9.4 of the Participation Agreement.
"Facility Fee Payment Date" shall mean the 15th day of each January, April,
July and October of each year and the last day of the Term.
Appendix - 13
"Fair Market Sales Value" shall mean, 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 arms-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, such Property. Fair Market Sales Value of any
Property shall be determined based on the assumption that, except for purposes
of Section 17 of the Lease, such Property is in the condition and state of
repair required under Section 10.1 of the Lease and each Credit Party is in
compliance with the other requirements of the Operative Agreements.
"Federal Funds Effective Rate" shall have the meaning given to such term in
the definition of ABR.
"Financing Parties" shall mean the Lessor, the Owner Trustee, in its trust
capacity, the Agent, the Holders and the Lenders.
"Fitch" shall mean Fitch Investors Service, Inc.
"Fixtures" shall mean all fixtures relating to the Improvements, including
all components thereof, located in or on the Improvements, together with all
replacements, modifications, alterations and additions thereto.
"Force Majeure Event" shall mean any event beyond the control of the
Construction Agent, other than a Casualty or Condemnation, including, but not
limited to, strikes or lockouts (but only when the Construction Agent is legally
prevented from securing replacement labor or materials as a result thereof),
adverse soil conditions, acts of God, adverse weather conditions, inability to
obtain labor or materials, governmental activities or regulations, civil
commotion and enemy action; but excluding any event, cause or condition that
results from the Construction Agent's financial condition.
"Future Amounts" shall have the meaning given to such term in Section 2.1
of the Agency Agreement.
"GAAP" shall mean generally accepted accounting principles set forth in the
opinions and pronouncements of the accounting principles board of the American
Institute of Certified Public Accountants, and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession, that are applicable to the circumstances as of the date of
determination.
"Governmental Action" shall mean 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, or required by any Legal Requirement, and shall include,
without limitation, all environmental and operating permits and licenses that
are required for the full use, occupancy, zoning and operating of the Property.
Appendix - 14
"Governmental Authority" shall mean any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Ground Lease" shall mean a ground lease (in form and substance
satisfactory to the Agent and the Holder) respecting any Property owned by the
Lessee and leased to the Lessor where such lease (i) has a 99 year term and
payments set at $1.00 per year, or (ii) is subject to such other terms and
conditions as are satisfactory to the Agent, the Lenders and the Holders.
"Guarantor" shall mean Capital One Financial Corporation, a Delaware
corporation.
"Hard Costs" shall mean all costs and expenses payable for supplies,
materials, labor and profit with respect to the Improvements under any
Construction Contract.
"Hazardous Substance" shall mean any of the following: (i) any petroleum
or petroleum product, explosives, radioactive materials, asbestos, formaldehyde,
polychlorinated biphenyls, lead and radon gas; (ii) any substance, material,
product, derivative, compound or mixture, mineral, chemical, waste, gas, medical
waste, or pollutant, in each case whether naturally occurring, man-made or the
by-product of any process, that is toxic, harmful or hazardous to the
environment or human health or safety as determined in accordance with any
Environmental Law; or (iii) any substance, material, product, derivative,
compound or mixture, mineral, chemical, waste, gas, medical waste or pollutant
that would support the assertion of any claim under any Environmental Law,
whether or not defined as hazardous as such under any Environmental Law.
"Holder Funding" shall mean any advance made by any Holder to the Owner
Trustee pursuant to the terms of the Trust Agreement (solely as it relates to
the COSI Trust Estate) or the Participation Agreement.
"Holder Amount" shall mean as of any date, the aggregate amount of Holder
Fundings made by each Holder to the COSI Trust Estate pursuant to Section 2 of
the Participation Agreement and Section 3.1 of the Trust Agreement less any
payments of any Holder Fundings received by the Holders pursuant to Section 3.4
of the Trust Agreement.
"Holder Applicable Margin" shall mean (i) with respect to Eurodollar Holder
Fundings, the Applicable Percentage for Eurodollar Loans of the same Interest
Period as such Eurodollar Holder Funding, plus one percent (1.00%), or (ii) with
respect to ABR Holder Fundings, a percentage equal to the ABR plus one percent
(1.00%).
"Holder Commitments" shall mean $1,150,000 respecting the COSI Trust
Estate, provided, that the Holder Commitment of each Holder shall be as set
forth on the Holder Certificate issued in favor of such Holder pursuant to the
Trust Agreement.
"Holder Construction Property Cost" shall mean, with respect to each
Construction Period Property for which the Basic Term has not commenced, at any
date of determination, an amount equal to the outstanding Holder Fundings made
with respect thereto under the Trust Agreement.
Appendix - 15
"Holder Overdue Rate" shall mean the lesser of (i) the ABR plus two percent
(2%) and (ii) the highest rate permitted by applicable law.
"Holder Property Cost" shall mean with respect to a Property an amount
equal to the outstanding Holder Fundings with respect thereto.
"Holders" shall mean Bank of America, N.A. and shall include the other
banks and other financial institutions which are from time to time holders of
Certificates in connection with the Capital One Realty Trust 1998-1.
"Holder Yield" shall mean with respect to Holder Fundings from time to time
either the Eurodollar Rate plus the Holder Applicable Margin or the ABR as
elected by the Owner Trustee from time to time with respect to such Holder
Fundings in accordance with the terms of the Trust Agreement; provided, however,
(i) upon delivery of the notice described in Section 3.7(c) of the Trust
Agreement, the outstanding Holder Fundings of each Holder shall bear a yield at
the ABR applicable from time to time from and after the dates and during the
periods specified in Section 3.7(c) of the Trust Agreement, and (ii) upon the
delivery by a Holder of the notice described in Section 3.9(d) of the Trust
Agreement, the Holder Fundings of such Holder shall bear a yield at the ABR
applicable from time to time after the dates and during the periods specified in
Section 3.9(d) of the Trust Agreement.
"Impositions" shall mean any and all liabilities, losses, expenses, costs,
charges and Liens of any kind whatsoever for fees, taxes, levies, imposts,
duties, charges, assessments or foreign withholdings ("Taxes") and all interest,
additions to tax and penalties thereon, which at any time prior to, during or
with respect to the Term or in respect of any period for which the Lessee shall
be obligated to pay Supplemental Rent, may be levied, assessed or imposed by any
Governmental Authority upon or with respect to (a) any Property or the leasing,
financing, refinancing, demolition, construction, substitution, subleasing,
assignment, control, condition, occupancy, servicing, maintenance, repair,
ownership, possession, activity conducted on, delivery, insuring, use,
operation, improvement, sale, transfer of title, return or other disposition of
such Property or any part thereof or interest therein or any rentals, receipts
or earnings arising therefrom; (b) the Notes or Certificates or any part thereof
or interest therein; or (c) the Operative Agreements, the performance thereof,
or any payment made or accrued pursuant thereto or otherwise in connection with
the transactions contemplated thereby.
"Improvements" shall mean, with respect to the construction, renovations
and/or Modifications on any Land, all buildings, structures, Fixtures, and other
improvements of every kind existing at any time and from time to time on or
under the Land purchased, leased or otherwise acquired using the proceeds of the
Loans or the Holder Fundings, 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, including
without limitation (a) any Improvements existing as of the Property Closing Date
as such Improvements may be referenced on the applicable Requisition and (b) any
Improvements made subsequent to such Property Closing Date.
Appendix - 16
"Incorporated Covenants" shall have the meaning given to such term in
Section 28.1 of the Lease.
"Incorporated Representations and Warranties" shall have the meaning given
to such term in Section 28.1 of the Lease.
"Indebtedness" of a Person shall mean, without duplication, such Person's:
(i) obligations for borrowed money;
(ii) obligations representing the deferred purchase price of
Property (whether real, personal, tangible, intangible or mixed) or
services (other than accounts payable arising in the ordinary course of
such Person's business payable on terms customary in the trade);
(iii) obligations, whether or not assumed, secured by liens or
payable out of the proceeds or production from property now or hereafter
owned or acquired by such Person;
(iv) obligations which are evidenced by notes, acceptances or other
instruments;
(v) Capitalized Lease Obligations;
(vi) net liabilities under interest rate swap, exchange or cap
agreements; and
(vii) contingent obligations.
"Indemnified Person" shall mean the Lessor, the Owner Trustee, in its
individual and its trust capacity, the Agent, the Holders, the Lenders, and
their respective successors, assigns, directors, shareholders, partners,
officers, employees, agents and Affiliates.
"Indemnity Provider" shall mean, respecting each Property, the Lessee.
"Individual Property Sale Requirements" shall have the meaning given to
such term in Section 20.1 of the Lease.
"Initial Closing Date" shall mean September 3, 1999.
"Initial Construction Advance" shall mean any initial Advance to pay for:
(i) Property Costs for construction of any Improvements; and (ii) the Property
Costs of restoring or repairing any Property which is required to be restored or
repaired in accordance with Section 15.1(e) of the Lease.
"Inspector" shall mean any Person engaged by the Agent to oversee the
monitoring of the progress of any Improvements and reviewing of Requisitions and
to provide related services relating to administration of such Improvements
during the Construction Period.
Appendix - 17
"Insurance Requirements" shall mean all terms and conditions of any
insurance policy either required by the Lease to be maintained by the Lessee or
required by the Agency Agreement to be maintained by the Construction Agent, and
all requirements of the issuer of any such policy and, regarding self insurance,
any other requirements of Lessee.
"Interest Period" shall mean during the Commitment Period and thereafter as to
any Eurodollar Loan or Eurodollar Holder Funding (i) with respect to the initial
Interest Period, the period beginning on the date of the first Eurodollar Loan
and Eurodollar Holder Funding and ending one (1) month, two (2) months, three
(3) months or (to the extent available to all Lenders and all Holders) six (6)
months thereafter, as selected by the Lessor (in the case of a Eurodollar Loan)
or the Owner Trustee (in the case of a Eurodollar Holder Funding) in its
applicable notice given with respect thereto and (ii) thereafter, each period
commencing on the last day of the next preceding Interest Period applicable to
such Eurodollar Loan or Eurodollar Holder Funding and ending one (1) month, two
(2) months, three (3) months or (to the extent available to all Lenders and all
Holders) six (6) months thereafter, as selected by the Lessor by irrevocable
notice to the Agent (in the case of a Eurodollar Loan) or by the Owner Trustee
(in the case of a Eurodollar Holder Funding) in each case not less than three
(3) Business Days prior to the last day of the then current Interest Period with
respect thereto; provided, however, that all of the foregoing provisions
-------- -------
relating to Interest Periods are subject to the following: (A) if any Interest
Period would end on a day which is not a Business Day, such Interest Period
shall be extended to the next succeeding Business Day (except that where the
next succeeding Business Day falls in the next succeeding calendar month, then
on the next preceding Business Day), (B) no Interest Period shall extend beyond
the Maturity Date or the Expiration Date, as the case may be, (C) where an
Interest Period begins on a day for which there is no numerically corresponding
day in the calendar month in which the Interest Period is to end, such Interest
Period shall end on the last Business Day of such calendar month, (D) there
shall not be more than four (4) Interest Periods outstanding at any one (1)
time.
"Investment Company Act" shall mean the Investment Company Act of 1940, as
amended, together with the rules and regulations promulgated thereunder.
"IRS" shall mean the United States Internal Revenue Service, or any
successor or analogous organization.
"Land" shall mean a parcel of real property described on (a) the
Requisition issued by the Construction Agent on the Property Closing Date
relating to such parcel and (b) the schedules to each applicable Lease
Supplement executed and delivered in accordance with the requirements of Section
2.4 of the Lease.
"Law" shall mean any statute, law, ordinance, regulation, rule, directive,
order, writ, injunction or decree of any Tribunal.
"Lease" or "Lease Agreement" shall mean the Lease Agreement (Capital One
Services, Inc.) (Tax Retention Operating Lease) dated as of the Initial Closing
Date, between the Lessor and
Appendix - 18
the Lessee, together with any Lease Supplements thereto, as such Lease Agreement
may from time to time be supplemented, amended or modified in accordance with
the terms thereof.
"Lease Default" shall mean any event or condition which, with the lapse of
time or the giving of notice, or both, would constitute a Lease Event of
Default.
"Lease Event of Default" shall have the meaning specified in Section 17.1
of the Lease.
"Lease Supplement" shall mean each Lease Supplement substantially in the
form of Exhibit A to the Lease, together with all attachments and schedules
thereto, as such Lease Supplement may be supplemented, amended or modified from
time to time.
"Legal Requirements" shall mean all foreign, federal, state, county,
municipal and other governmental statutes, laws, rules, orders, regulations,
ordinances, judgments, decrees and injunctions affecting the Owner Trustee, the
Holders, the Lessor, any Credit Party, the Agent, any Lender or any Property,
Land, Improvement, Equipment or the taxation, demolition, construction, use or
alteration of such Improvements, 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 limit the use and enjoyment thereof (including all
building, zoning and fire codes and the Americans with Disabilities Act of 1990,
42 U.S.C. (S) 12101 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 which are either of record or known to any Credit
Party affecting any Property or the Appurtenant Rights.
"Lender Commitments" shall mean $28,850,000 as such amount may be increased
or reduced from time to time pursuant to the Credit Agreement; provided if there
shall be more than one Lender, the Lender Commitment of each Lender shall be as
set forth in Schedule 1.1 to the Credit Agreement as such Schedule 1.1 may be
amended and replaced from time to time.
"Lender Financing Statements" shall mean UCC financing statements and
fixture filings appropriately completed and executed for filing in the
applicable jurisdiction in order to procure a security interest in favor of the
Agent in any Equipment or in any Improvements.
"Lenders" shall mean the several banks and other financial institutions
from time to time party to the Credit Agreement.
"Lessee" shall mean Capital One Services, Inc., a Delaware corporation.
"Lessor" shall mean the Owner Trustee, not in its individual capacity, but
as Lessor under the Lease.
"Lessor Basic Rent" shall mean the scheduled Holder Yield due on the Holder
Fundings on any Scheduled Interest Payment Date pursuant to the Trust Agreement
(but not including interest
Appendix - 19
on (i) any such scheduled Holder Yield due on the Holder Fundings prior to the
Basic Term Commencement Date with respect to the Property to which such Holder
Fundings relate or (ii) overdue amounts under the Trust Agreement or otherwise).
"Lessor Financing Statements" shall mean UCC financing statements and
fixture filings appropriately completed and executed for filing in the
applicable jurisdictions in order to protect the Lessor's interest under the
Lease to the extent the Lease is a security agreement or a mortgage.
"Lessor Lien" shall mean any Lien, true lease or sublease or disposition of
title arising as a result of (a) any claim against the Lessor or Trust Company,
in its individual capacity, not resulting from the transactions contemplated by
the Operative Agreements, (b) any act or omission of the Lessor or Trust
Company, in its individual capacity, which is not required by the Operative
Agreements or is in violation of any of the terms of the Operative Agreements,
(c) any claim against the Lessor or Trust Company, in its individual capacity,
with respect to Taxes or Transaction Expenses against which the Lessee is not
required to indemnify Lessor or Trust Company, in its individual capacity,
pursuant to Section 13 of the Participation Agreement or (d) any claim against
the Lessor arising out of any transfer by the Lessor of all or any portion of
the interest of the Lessor in the Properties, the COSI Trust Estate or the
Operative Agreements other than the transfer of title to or possession of any
Properties by the Lessor pursuant to and in accordance with the Lease, the
Credit Agreement, the Security Agreement or the Participation Agreement or
pursuant to the exercise of the remedies set forth in Article XVII of the Lease.
"Level Status" means the applicable Level Status set forth in the table
below (with Level Status V being the lowest Level Status and Level Status I
being the highest Level Status), it being agreed that the applicable Level
Status as of any date of determination shall be deemed to be the lowest Level
Status which includes the applicable Debt Rating by at least two of the Rating
Agencies:
==========================================================================================================
▇▇▇▇▇'▇ Investors Standard & Poor's Fitch Investors
Level Status Service, Inc. Ratings Services Service, Inc.
----------------------------------------------------------------------------------------------------------
Level Status I Baa1 or higher BBB+ or higher BBB+ or higher
----------------------------------------------------------------------------------------------------------
Level Status II Baa2 or higher BBB or higher BBB or higher
----------------------------------------------------------------------------------------------------------
Level Status III Baa3 or higher BBB- or higher BBB- or higher
----------------------------------------------------------------------------------------------------------
Level Status IV Ba1 or higher BB+ or higher BB+ or higher
----------------------------------------------------------------------------------------------------------
Level Status V Below Ba1 or unrated Below BB+ or unrated Below BB+ or unrated
==========================================================================================================
"Lien" shall mean any mortgage, pledge, security interest, encumbrance,
lien, option or charge of any kind.
Appendix - 20
"Limited Recourse Amount" shall mean with respect to the Properties on an
aggregate basis, an amount equal to the sum of the Termination Values with
respect to all of the Properties on each Payment Date, less the Maximum Residual
Guarantee Amount as of such date with respect to the Properties.
"Loans" shall have the meaning given to such term in Section 2.1(a) in the
Credit Agreement and shall include both the Tranche A Loans and the Tranche B
Loans.
"Loan Basic Rent" shall mean the interest due on the Loans on any Scheduled
Interest Payment Date pursuant to the Credit Agreement (but not including
interest on (i) any such Loan prior to the Basic Term Commencement Date with
respect to the Property to which such Loan relates or (ii) any overdue amounts
under Section 2.8(c) of the Credit Agreement or otherwise).
"Loan Property Cost" shall mean, with respect to each Property at any date
of determination, an amount equal to (a) the aggregate principal amount all
Loans (including without limitation all Acquisition Loans and Construction
Loans) made on or prior to such date with respect to such Property (including
any Loans made to fund interest, Transaction Expenses and indemnity payments
prior to the Basic Term Commencement Date for each Property Date attributed or
allocated to such Property), minus (b) the aggregate amount of prepayments or
-----
repayments as the case may be of the Loans allocated to reduce the Loan Property
Cost of such Property pursuant to Section 2.6(c) of the Credit Agreement.
"Majority Lenders" shall mean at any time, Lenders whose Loans outstanding
represent at least fifty-one percent (51%) of the aggregate Loans outstanding.
"Marketing Period" shall mean, if the Lessee has given a Sale Notice in
accordance with Section 20.1 of the Lease, the period commencing on the date
such Sale Notice is given and ending on the Expiration Date.
"Material Adverse Effect" shall, mean a material adverse effect on (a) the
business, condition (financial or otherwise), assets, liabilities or operations
of the Credit Parties and their Affiliates taken as a whole, (b) the ability of
any Credit Party to perform its respective obligations under any Operative
Agreement to which it is a party, (c) the validity or enforceability of any
Operative Agreement or the rights and remedies of the Agent, the Lenders, the
Holders, or the Lessor thereunder, (d) the validity, priority or enforceability
of any Lien on any Property created by any of the Operative Agreements, or (e)
the value, utility or useful life of any Property or the use, or ability of the
applicable Lessee to use, any Property for the purpose for which it was
intended.
"Maturity Date" shall mean the Expiration Date.
"Maximum Amount" shall mean, as of any date of payment, without
duplication, (a) one hundred percent (100%) of the cost of acquiring the Land
for all, but not less than all, the Construction Period Properties
(collectively, the "Land Cost"), plus (b) the product of eighty-nine and nine-
tenths percent (89.9%) multiplied by the following: aggregate Termination Value
for all, but not less than all, the Construction Period Properties, minus the
-----
Land Cost, minus all
-----
Appendix - 21
structuring fees payable in connection with the transactions evidenced by the
Operative Agreements to Bank of America Securities LLC, Bank of America, N.A.
and/or any Affiliates of either of the foregoing, minus accrued, unpaid Holder
-----
Yield respecting any and all Construction Period Properties) minus (c) the
-----
accreted value (calculated at a rate of six and twenty-five one hundreths
percent (6.25%) per annum) of any payments previously made by the Construction
Agent or the Lessee regarding any and all Construction Period Properties and not
reimbursed minus (d) the product of ten and one-tenth percent (10.1%) multiplied
-----
by the aggregate Future Amounts deposited into escrow with the Agent pursuant to
Section 2.1 of the Agency Agreement.
"Maximum Property Cost" shall mean the aggregate amount of the Property
Costs for all Properties subject to the Lease as of the applicable determination
date (calculated without regard to the purchase or sale of any Property).
"Maximum Residual Guarantee Amount" shall mean an amount equal to the
product of the aggregate Property Cost for all of Properties times 85%.
"Modifications" shall have the meaning specified in Section 11.1(a) of the
Lease.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc.
"Mortgage Instrument" shall mean any mortgage, deed of trust or any other
instrument executed by the Owner Trustee and the Lessee in favor of the Agent
(for the benefit of the Lenders and the Holders) and evidencing a Lien on the
Property, in form and substance reasonably acceptable to the Agent.
"Multiemployer Plan" shall mean any plan described in Section 4001(a)(3) of
ERISA to which contributions are or have been made or required by the
Construction Agent or any Credit Party or any of its Subsidiaries or ERISA
Affiliates.
"Multiple Employer Plan" shall mean a plan to which the Construction Agent
or any Credit Party or any ERISA Affiliate and at least one other employer other
than an ERISA Affiliate is making or accruing an obligation to make, or has made
or accrued an obligation to make, contributions.
"Net Proceeds" shall mean all amounts paid in connection with any Casualty
or Condemnation, and all interest earned thereon, less the expense of claiming
and collecting such amounts, including all costs and expenses in connection
therewith for which the Agent or Lessor are entitled to be reimbursed pursuant
to the Lease.
"Net Sale Proceeds Shortfall" shall mean the amount by which the proceeds
of a sale described in Section 22.1 of the Lease (net of all expenses of sale)
are less than the Limited Recourse Amount with respect to the Properties to the
extent it has been determined that the Fair Market Sales Value of the Properties
at the expiration of the term of the Lease has been impaired by greater than
expected wear and tear during the Term of the Lease.
Appendix - 22
"Non-Excluded Taxes" shall have the meaning given to such term in Section
2.13 of the Credit Agreement.
"Notes" shall mean those notes issued to the Lenders pursuant to the Credit
Agreement and shall include both the Tranche A Notes and the Tranche B Notes.
"Occupational Safety and Health Law" shall mean the Occupational Safety and
Health Act of 1970 and any other federal, state or local statute, law,
ordinance, code, rule, regulation, order or decree regulating or relating to, or
imposing liability or standards of conduct concerning, employee health and/or
safety, as now or at any time hereafter in effect.
"Officer's Certificate" with respect to any person shall mean a certificate
executed on behalf of such person by a Responsible Officer who has made or
caused to be made such examination or investigation as is necessary to enable
such Responsible Officer to express an informed opinion with respect to the
subject matter of such Officer's Certificate.
"Operative Agreements" shall mean the following: the Participation
Agreement, the Agency Agreement, the Trust Agreement, the Certificates, the
Credit Agreement, the Notes, the Lease (and a memorandum thereof in a form
reasonably acceptable to the Agent), each Lease Supplement (and a memorandum
thereof in a form reasonably acceptable to the Agent), the Security Documents
and each Ground Lease.
"Overdue Interest" shall mean any interest payable pursuant to Section
2.8(b) of the Credit Agreement.
"Overdue Rate" shall mean (i) with respect to Loan Basic Rent, and any
other amount owed under or with respect to the Credit Agreement or the Security
Documents, the rate specified in Section 2.8(b) of the Credit Agreement, (ii)
with respect to Lessor Basic Rent, the Holder Yield and any other amount owed
under or with respect to the Trust Agreement, the applicable rate specified in
the Trust Agreement, and (iii) with respect to any other amount, the lesser of
the ABR plus two percent (2%) or the amount referred to in clause (y) of Section
2.8(b) of the Credit Agreement.
"Owner Trustee," "Borrower" or "Lessor" shall mean First Security Bank,
National Association, not individually, except as expressly stated in the
various Operative Agreements, but solely as Owner Trustee under the Capital One
Realty Trust 1998-1, and any successor or replacement Owner Trustee expressly
permitted under the Operative Agreements.
"Participant" shall have the meaning given to such term in Section 9.7 of
the Credit Agreement.
"Participation Agreement" shall mean the Participation Agreement (Capital
One Services, Inc.), dated as of the Initial Closing Date, among the Lessee, the
Guarantor, the Owner Trustee, not in its individual capacity except as expressly
stated therein, the Holders, the Lenders and the Agent,
Appendix - 23
as such Participation Agreement may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof or of any other
Operative Agreement.
"Payment Date" shall mean any Scheduled Interest Payment Date and any date
on which interest or Holder Yield in connection with a prepayment of principal
on the Loans or of the Holder Fundings is due under the Credit Agreement or the
Trust Agreement.
"PBGC" shall mean the Pension Benefit Guaranty Corporation created by
Section 4002(a) of ERISA or any successor thereto.
"Pension Plan" shall mean a "pension plan", as such term is defined in
section 3(2) of ERISA, which is subject to title IV of ERISA (other than a
Multiemployer Plan), and to which the Lessee or any ERISA Affiliate may have any
liability, including any liability by reason of having been a substantial
employer within the meaning of section 4063 of ERISA at any time during the
preceding five (5) years, or by reason of being deemed to be a contributing
sponsor under section 4069 of ERISA.
"Permitted Exceptions" shall mean Liens of the types described in clauses
(i), (ii), (iii), (v) and (viii) of the definition of Permitted Liens.
"Permitted Facility" shall mean that certain 4-story office building at
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, its respective interest in the
related 5-story parking garage and the related ground lease for the real
property at such location or such other facility proposed by the Lessee and
acceptable to the Lenders and the Holders, as provided in Section 5.3(t) of the
Participation Agreement.
"Permitted Liens" shall mean:
(i) the respective rights and interests of the parties to the
Operative Agreements as provided in the Operative Agreements;
(ii) the rights of any sublessee or assignee under a sublease or
an assignment expressly permitted by the terms of the Lease;
(iii) Liens for Taxes that either are not yet due or are being
contested in accordance with the provisions of Section 13.1 of the Lease;
(iv) Liens arising by operation of law, materialmen's,
mechanics', workmen's, repairmen's, employees', carriers', warehousemen's
and other like Liens relating to the construction of the Improvements or in
connection with any Modifications or arising in the ordinary course of
business for amounts that either are not more than 30 days past due or are
being diligently contested in good faith by appropriate proceedings, so
long as such proceedings satisfy the conditions for the continuation of
proceedings to contest Taxes set forth in Section 13.1 of the Lease;
Appendix - 24
(v) Liens of any of the types referred to in clause (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 and the
Agent have been made), which bonding (or arrangements) shall comply with
applicable Legal Requirements, and shall have 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 awards and satisfy the conditions for the continuation of proceedings to
contest Taxes set forth in Section 13.1 of the Lease;
(vii) Liens in favor of municipalities to the extent agreed to
by the Lessor; and
(viii) all encumbrances, exceptions, restrictions, easements,
rights of way, servitudes, encroachments and irregularities in title, other
than Liens which, in the reasonable assessment of the Agent, do not
materially impair the value or the use of the Property for its intended
purpose.
"Person" shall mean any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
governmental authority or any other entity.
"Plans and Specifications" shall mean, with respect to Improvements, the
plans and specifications for such Improvements to be constructed or already
existing, as such Plans and Specifications may be amended, modified or
supplemented from time to time in accordance with the terms of the Participation
Agreement.
"Prime Lending Rate" shall have the meaning given to such term in the
definition of ABR.
"Property" shall mean, with respect to each Permitted Facility that is (or
is to be) acquired, constructed and/or renovated pursuant to the terms of the
Operative Agreements, the Land and each item of Equipment and the various
Improvements, in each case located on such Land, including without limitation
each Construction Period Property and each Property for which the Basic Term has
commenced.
"Property Acquisition Cost" shall mean the cost to Lessor to purchase a
Property on a Property Closing Date.
"Property Closing Date" shall mean the date on which the Lessor purchases
or leases (pursuant to a Ground Lease) a Property or, with respect to the first
Advance, the date on which the Lessor seeks reimbursement for Property
previously purchased or leased by the Lessor.
Appendix - 25
"Property Cost" shall mean with respect to a Property the aggregate amount
of the Loan Property Cost, plus the Holder Property Cost for such Property (as
such amounts shall be increased equally among all Properties respecting the
Holder Fundings and the Loans extended from time to time to pay for the
Transaction Expenses, fees, expenses and other disbursements referenced in
Article IX and indemnity payments pursuant to Section 13.6, in each case of the
Participation Agreement).
"Purchase Option" shall have the meaning given to such term in Section 20.1
of the Lease.
"Purchasing Lender" shall have the meaning given to such term in Section
9.8(a) of the Credit Agreement.
"Rating Agencies" shall mean ▇▇▇▇▇'▇, S&P and Fitch or, in each case, any
successor nationally recognized statistical rating organization.
"Redemption Date" shall have the meaning given to such term in Section
3.1(d) of the Trust Agreement.
"Register" shall have the meaning given to such term in Section 9.9(a) of
the Credit Agreement.
"Release" shall mean any release, pumping, pouring, emptying, injecting,
escaping, leaching, dumping, seepage, spill, leek, flow, discharge, disposal or
emission of a Hazardous Substance.
"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System (or any successor), as the same may be modified and
supplemented and in effect from time to time.
"Renewal Term" shall have the meaning specified in Section 2.2 of the
Lease.
"Rent" shall mean, collectively, the Basic Rent and the Supplemental Rent,
in each case payable under the Lease.
"Reportable Event" shall have the meaning specified in ERISA.
"Requested Funds" shall mean any funds requested by the Lessee or the
Construction Agent, as applicable, in accordance with Section 5 of the
Participation Agreement.
"Requirement of Law" shall mean, as to any Person, the Certificate of
Incorporation and By-laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
Appendix - 26
"Requisition" shall have the meaning specified in Section 4.2 of the
Participation Agreement.
"Responsible Officer" shall mean the Chairman or Vice Chairman of the Board
of Directors, the Chairman or Vice Chairman of the Executive Committee of the
Board of Directors, the President, any Senior Vice President or Executive Vice
President, any Vice President, the Secretary, any Assistant Secretary, the
Treasurer, or any Assistant Treasurer or any other officer with responsibility
for and knowledge of the subject matter, except that when used with respect to
the Trust Company or the Owner Trustee, "Responsible Officer" shall also include
the Cashier, any Assistant Cashier, any Trust Officer or Assistant Trust
Officer, the Controller and any Assistant Controller or any other officer of the
Trust Company or the Owner Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of his knowledge of and familiarity with the
particular subject.
"S&P" shall mean Standard and Poors Rating Group, a division of McGraw
Hill, Inc.
"Sale Date" shall have the meaning given to such term in Section 22.1(a) of
the Lease.
"Sale Notice" shall mean a notice given to Lessor in connection with the
election by Lessee of its Sale Option.
"Sale Option" shall have the meaning given to such term in Section 20.1 of
the Lease.
"Scheduled Interest Payment Date" shall mean (a) as to any Eurodollar Loan
or Eurodollar Holder Funding, the last day of the Interest Period applicable to
such Eurodollar Loan or Eurodollar Holder Funding (or respecting any Eurodollar
Loan or Eurodollar Holder Funding having an Interest Period of six (6) months,
the three (3) month anniversary of such Interest Period), (b) as to any ABR Loan
or any ABR Holder Funding, the fifteenth day of each month, unless such day is
not a Business Day and in such case on the next occurring Business Day and (c)
as to all Loans and Holder Fundings, the date of any voluntary or involuntary
payment, prepayment, return or redemption, and the Redemption Date or the
Expiration Date, as the case may be.
"Securities Act" shall mean the Securities Act of 1933, as amended,
together with the rules and regulations promulgated thereunder.
"Security Agreement" shall mean the Security Agreement (Capital One
Services, Inc.), dated as of the Initial Closing Date between the Lessor and the
Agent, for the benefit of the Lenders and, respecting the Security Documents,
the Holders, as amended, supplemented or otherwise modified from time to time.
"Security Documents" shall mean the collective reference to the Security
Agreement, the Mortgage Instruments, and all other security documents hereafter
delivered to the Agent granting a lien on any asset or assets of any Person to
secure the obligations and liabilities of the Lessor under
Appendix - 27
the Credit Agreement and/or under any of the other Credit Documents or to secure
any guarantee of any such obligations and liabilities.
"Soft Costs" shall mean all costs related to the development and
construction of the Improvements other than Hard Costs.
"Subsidiary" shall mean, as to any Person, any corporation of which at
least a majority of the outstanding stock having by the terms thereof ordinary
voting power to elect a majority of the board of directors of such corporation
(irrespective of whether or not at the time stock of any other class or classes
of such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person, or by one or
more Subsidiaries, or by such Person and one or more Subsidiaries.
"Supplemental Rent" shall mean all amounts, liabilities and obligations
(other than Basic Rent) which the Lessee assumes or agrees to pay to Lessor, the
Trust Company, the Holders, the Agent, the Lenders or any other Person under the
Lease or under any of the other Operative Agreements including, without
limitation, payments of the Termination Value and the Maximum Residual Guarantee
Amount and all indemnification amounts, liabilities and obligations.
"Taxes" shall have the meaning specified in the definition of Impositions.
"Term" shall mean the Basic Term (including any Renewal Term).
"Termination Date" shall have the meaning specified in Section 16.2(a) of
the Lease.
"Termination Event" shall mean (a) with respect to any Pension Plan, the
occurrence of a Reportable Event or an event described in Section 4062(e) of
ERISA, (b) the withdrawal of the Construction Agent or any Credit Party or any
ERISA Affiliate from a Multiple Employer Plan during a plan year in which it was
a substantial employer (as such term is defined in Section 4001(a)(2) of ERISA),
or the termination of a Multiple Employer Plan, (c) the distribution of a notice
of intent to terminate a Plan or Multiemployer Plan pursuant to Section
4041(a)(2) or 4041A of ERISA, (d) the institution of proceedings to terminate a
Plan or Multiemployer Plan by the PBGC under Section 4042 of ERISA, (e) any
other event or condition which might constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to administer, any
Plan or Multiemployer Plan, or (f) the complete or partial withdrawal of the
Construction Agent or any Credit Party or any ERISA Affiliate from a
Multiemployer Plan.
"Termination Notice" shall have the meaning specified in Section 16.1 of
the Lease.
"Termination Value" shall mean, without duplication, the sum of (a) either
(i) with respect to all Properties, an amount equal to the aggregate outstanding
Property Cost for all the Properties, in each case as of the last occurring
Payment Date, or (ii) with respect to a particular Property, an amount equal to
the product of the Termination Value of all the Properties times a fraction, the
numerator of which is the Property Cost allocable to the particular Property in
question and the denominator of which is the aggregate Property Cost for all the
Properties, in each case as of the
Appendix - 28
last occurring Payment Date, plus (b) respecting the amounts described in each
of the foregoing subclause (i) or (ii), as applicable, any and all accrued and
unpaid interest on the Loans and any and all accrued and unpaid Holder Yield on
the Holder Fundings related to the applicable Property Cost plus (c) all other
Rent and other amounts then due and payable or accrued and unpaid under the
Agency Agreement, Lease and/or under any other Operative Agreement (including
without limitation all costs and expenses referred to in clause FIRST of Section
-----
22.2 of the Lease).
"Total Condemnation" shall mean a Condemnation that involves a taking of
Lessor's entire title to a Property.
"Tranche A Commitments" shall mean the obligation of the Tranche A Lenders
to make the Tranche A Loans to the Lessor in an aggregate principal amount at
any one time outstanding not to exceed the aggregate of the amounts set forth
opposite each Tranche A Lender's name on Schedule 1.1 to the Credit Agreement,
as such amount may be reduced from time to time in accordance with the
provisions of the Operative Agreements; provided no Tranche A Lender shall be
obligated to make Tranche A Loans in excess of such Tranche A Lender's share of
the Tranche A Commitments as set forth adjacent to such Tranche A Lender's name
on Schedule 1.1 to Credit Agreement.
"Tranche A Lenders" shall mean the several banks and other financial
institutions from time to time party to the Credit Agreement that commit to make
the Tranche A Loans, together with their successors and assigns.
"Tranche A Loans" shall mean the Loans made pursuant to the Tranche A
Commitment.
"Tranche A Note" shall have the meaning given to it in Section 2.2 of the
Credit Agreement.
"Tranche B Commitments" shall mean the obligation of the Tranche B Lenders
to make the Tranche B Loans to the Lessor in an aggregate principal amount at
any one time outstanding not to exceed the aggregate of the amounts set forth
opposite each Tranche B Lender's name on Schedule 1.1 to the Credit Agreement,
as such amount may be reduced from time to time in accordance with the
provisions of the Operative Agreements; provided no Tranche B Lender shall be
obligated to make Tranche B Loans in excess of such Tranche B Lender's share of
the Tranche B Commitments as set forth adjacent to such Tranche B Lender's name
on Schedule 1.1 to Credit Agreement.
"Tranche B Lenders" shall mean the several banks and other financial
institutions from time to time party to the Credit Agreement that commit to make
the Tranche B Loans, together with their successors and assigns.
"Tranche B Loan" shall mean the Loans made pursuant to the Tranche B
Commitment.
"Tranche B Note" shall have the meaning given to it in Section 2.2 of the
Credit Agreement.
Appendix - 29
"Transaction Expenses" shall mean all costs and expenses incurred in
connection with the preparation, execution and delivery of the Operative
Agreements and the transactions contemplated by the Operative Agreements
including without limitation:
(a) the reasonable fees, out-of-pocket expenses and disbursements of
counsel in negotiating the terms of the Operative Agreements and the other
transaction documents, preparing for the closings under, and rendering
opinions in connection with, such transactions and in rendering other
services customary for counsel representing parties to transactions of the
types involved in the transactions contemplated by the Operative
Agreements;
(b) any and all other reasonable fees, charges or other amounts
payable to the Lenders, Agent, the Holders, the Owner Trustee or any broker
which arises under any of the Operative Agreements;
(c) any other reasonable fee, out-of-pocket expenses, disbursement or
cost of any party to the Operative Agreements or any of the other
transaction documents; and
(d) any and all Taxes and fees incurred in recording or filing any
Operative Agreement or any other transaction document, any deed,
declaration, mortgage, security agreement, notice or financing statement
with any public office, registry or governmental agency in connection with
the transactions contemplated by the Operative Agreement.
"Tribunal" shall mean any state, commonwealth, federal, foreign,
territorial, or other court or government body, subdivision agency, department,
commission, board, bureau or instrumentality of a governmental body.
"Trust Agreement" shall mean the Amended and Restated Trust Agreement dated
as of the Initial Closing Date between the Holders and the Owner Trustee.
"Trust Company" shall mean First Security Bank, National Association, in
its individual capacity, and any successor owner trustee under the Trust
Agreement in its individual capacity.
"Trust Estate" shall have the meaning specified in Section 2.2 of the Trust
Agreement.
"Type" shall mean, as to any Loan, whether it is an ABR Loan or a
Eurodollar Loan.
"UCC Financing Statements" shall mean collectively the Lender Financing
Statements and the Lessor Financing Statements.
"Unanimous Vote Matters" shall have the meaning given it in Section 10.2(j)
of the Participation Agreement.
"Unfunded Amount" shall have the meaning specified in Section 3.2 of the
Agency Agreement.
Appendix - 30
"Uniform Commercial Code" and "UCC" shall mean the Uniform Commercial Code
as in effect in any applicable jurisdiction.
"United States Bankruptcy Code" shall mean Title 11 of the United States
Code.
"Voting Power" shall mean, with respect to securities issued by any Person,
the combined voting power of all securities of such person which are issued and
outstanding at the time of determination and which are entitled to vote in the
election of directors or such Person, other than securities having such power
only by reason of the happening of a contingency.
"Wholly-Owned Entity" shall mean a Person all of the shares of capital
stock or other ownership interest of which are owned by the referenced Person
and/or one of its wholly-owned Subsidiaries or other wholly-owned entities.
"Withdrawal Liability" shall mean liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
"Work" shall mean the furnishing of labor, materials, components,
furniture, furnishings, fixtures, appliances, machinery, equipment, tools,
power, water, fuel, lubricants, supplies, goods and/or services with respect to
any Property.
"Year 2000 Problem" shall have the meaning specified in Section 7.3(i) of
the Participation Agreement.
Appendix - 31