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EXHIBIT 10.30
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MASTER LEASE AGREEMENT
Dated as of April 23, 1999
between
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually,
but solely as the Owner Trustee
under the VS Trust 1999-1,
as Lessor
and
VERITAS SOFTWARE CORPORATION,
as Lessee
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This Master Lease Agreement is subject to a security interest in favor of
NationsBank, N.A., as the agent for the Lenders and respecting the Security
Documents, as the agent for the Lenders and the Holders, to the extent of their
interests (the "Agent") under a Security Agreement dated as of April 23, 1999,
between First Security Bank, National Association, not individually, but solely
as the Owner Trustee under the VS Trust 1999-1 and the Agent, as amended,
modified, extended, supplemented, restated and/or replaced from time to time in
accordance with the applicable provisions thereof. This Lease Agreement has been
executed in several counterparts. To the extent, if any, that this Lease
Agreement constitutes chattel paper (as such term is defined in the Uniform
Commercial Code as in effect in any applicable jurisdiction), no security
interest in this Lease Agreement may be created through the transfer or
possession of any counterpart other than the original counterpart containing the
receipt therefor executed by the Agent on the signature page hereof.
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TABLE OF CONTENTS
ARTICLE I................................................................. 1
1.1 Definitions..................................................... 1
1.2 Interpretation.................................................. 2
ARTICLE II................................................................ 2
2.1 Property........................................................ 2
2.2 Lease Term...................................................... 2
2.3 Title........................................................... 3
2.4 Lease Supplements............................................... 3
ARTICLE III............................................................... 3
3.1 Rent............................................................ 3
3.2 Payment of Basic Rent........................................... 4
3.3 Supplemental Rent............................................... 4
3.4 Performance on a Non-Business Day............................... 5
3.5 Rent Payment Provisions......................................... 5
ARTICLE IV................................................................ 5
4.1 Taxes; Utility Charges.......................................... 5
ARTICLE V................................................................. 6
5.1 Quiet Enjoyment................................................. 6
ARTICLE VI................................................................ 6
6.1 Net Lease....................................................... 6
6.2 No Termination or Abatement..................................... 7
ARTICLE VII............................................................... 7
7.1 Ownership of the Properties..................................... 7
ARTICLE VIII.............................................................. 9
8.1 Condition of the Properties..................................... 9
8.2 Possession and Use of the Properties............................ 9
8.3 Integrated Properties........................................... 11
ARTICLE IX................................................................ 11
9.1 Compliance With Legal Requirements, Insurance Requirements and
Manufacturer's Specifications and Standards..................... 11
ARTICLE X................................................................. 11
10.1 Maintenance and Repair; Return.................................. 11
10.2 Environmental Inspection........................................ 13
ARTICLE XI................................................................ 13
11.1 Modifications................................................... 13
ARTICLE XII............................................................... 15
12.1 Warranty of Title............................................... 15
ARTICLE XIII.............................................................. 16
13.1 Permitted Contests Other Than in Respect of Indemnities......... 16
13.2 Impositions, Utility Charges, Other Matters; Compliance with
Legal Requirements.............................................. 16
ARTICLE XIV............................................................... 17
14.1 Public Liability and Workers' Compensation Insurance............ 17
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14.2 Permanent Hazard and Other Insurance Coverage to be
Maintained by Other......................................... 17
14.3 Coverage...................................................... 18
14.4 Additional Insurance Requirements............................. 20
ARTICLE XV............................................................... 20
15.1 Casualty and Condemnation..................................... 20
15.2 Environmental Matters......................................... 23
15.3 Notice of Environmental Matters............................... 26
ARTICLE XVI.............................................................. 26
16.1 Termination Upon Certain Events............................... 26
16.2 Procedures.................................................... 26
ARTICLE XVII............................................................. 27
17.1 Lease Events of Default....................................... 27
17.2 Surrender of Possession....................................... 31
17.3 Reletting..................................................... 31
17.4 Damages....................................................... 31
17.5 Power of Sale................................................. 32
17.6 Final Liquidated Damages...................................... 32
17.7 Environmental Costs........................................... 33
17.8 Waiver of Certain Rights...................................... 33
17.9 Assignment of Rights Under Contracts.......................... 33
17.10 Remedies Cumulative........................................... 34
ARTICLE XVIII............................................................ 34
18.1 Lessor's Right to Cure Lessee's Lease Defaults................ 34
ARTICLE XIX.............................................................. 35
19.1 Provisions Relating to Lessee's Exercise of its Purchase
Option...................................................... 35
19.2 [Intentionally Omitted]....................................... 35
ARTICLE XX............................................................... 35
20.1 Purchase Option or Sale Option - General Provisions........... 35
20.2 Lessee Purchase Option........................................ 36
20.3 Third Party Sale Option....................................... 37
ARTICLE XXI.............................................................. 38
21.1 [Intentionally Omitted]....................................... 38
ARTICLE XXII............................................................. 38
22.1 Sale Procedure................................................ 38
22.2 Application of Proceeds of Sale............................... 41
22.3 Indemnity for Excessive Wear.................................. 41
22.4 Appraisal Procedure........................................... 42
22.5 Certain Obligations Continue.................................. 42
ARTICLE XXIII............................................................ 43
23.1 Holding Over.................................................. 43
ARTICLE XXIV............................................................. 43
24.1 Risk of Loss.................................................. 43
ARTICLE XXV.............................................................. 44
25.1 Assignment.................................................... 44
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25.2 Subleases........................................................ 44
ARTICLE XXVI................................................................ 45
26.1 No Waiver........................................................ 45
ARTICLE XXVII............................................................... 45
27.1 Acceptance of Surrender.......................................... 45
27.2 No Merger of Title............................................... 45
ARTICLE XXVIII.............................................................. 46
28.1 [RESERVED]....................................................... 46
ARTICLE XXIX................................................................ 46
29.1 Notices.......................................................... 46
ARTICLE XXX................................................................. 46
30.1 Miscellaneous.................................................... 46
30.2 Amendments and Modifications..................................... 46
30.3 Successors and Assigns........................................... 46
30.4 Headings and Table of Contents................................... 46
30.5 Counterparts..................................................... 47
30.6 GOVERNING LAW.................................................... 47
30.7 Calculation of Rent.............................................. 47
30.8 Memoranda of Lease and Lease Supplements......................... 47
30.9 Allocations between the Lenders and the Holders.................. 48
30.10 Limitations on Recourse.......................................... 48
30.11 WAIVERS OF JULY TRIAL............................................ 48
30.12 Exercise of Lessor Rights........................................ 48
30.13 SUBMISSION TO JURISDICTION; VENUE................................ 49
30.14 USURY SAVINGS PROVISION.......................................... 49
EXHIBITS
EXHIBIT A - Lease Supplement No. ____
EXHIBIT B - Memorandum of Lease and Lease Supplement No. ____
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MASTER LEASE AGREEMENT
THIS MASTER LEASE AGREEMENT dated as of April 23, 1999 (as amended,
modified, extended, supplemented, restated and/or replaced from time to time,
this "Lease") is between FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national
banking association, having its principal office at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, not individually, but solely as the Owner Trustee under
the VS Trust 1999-1, as lessor (the "Lessor"), and VERITAS SOFTWARE CORPORATION,
a Delaware corporation, having its principal place of business at ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as lessee (the "Lessee").
WITNESSETH:
A. WHEREAS, subject to the terms and conditions of the Participation
Agreement and the Agency Agreement, Lessor will (i) purchase certain real
property, some of which will (or may) have existing Improvements thereon, from
one (1) or more third parties designated by Lessee and (ii) fund the
acquisition, installation, testing, use, development, construction, operation,
maintenance, repair, refurbishment and restoration of the Properties by the
Construction Agent; and
B. WHEREAS, the Basic Term shall commence with respect to each Property
upon the Property Closing Date with respect thereto; provided, Basic Rent with
respect thereto shall not be payable until the applicable Rent Commencement
Date; and
C. WHEREAS, Lessor desires to lease to Lessee, and Lessee desires to
lease from Lessor, each Property;
NOW, THEREFORE, in consideration of the foregoing, and of other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
1.1 DEFINITIONS.
For purposes of this Lease, capitalized terms used in this Lease and
not otherwise defined herein shall have the meanings assigned to them in
Appendix A to that certain Participation Agreement dated as of April 23, 1999
(as amended, modified, extended, supplemented, restated and/or replaced from
time to time in accordance with the applicable provisions thereof, the
"Participation Agreement") among Lessee, the various parties thereto from time
to time, as the Guarantors, Lessor, the various banks and other lending
institutions which are parties thereto from time to time, as the Holders, the
various banks and other lending institutions which are parties thereto from time
to time, as the Lenders, and NationsBank, N.A.,
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as agent for the Lenders and respecting the Security Documents, as the agent for
the Lenders and the Holders, to the extent of their interests. Unless otherwise
indicated, references in this Lease to articles, sections, paragraphs, clauses,
appendices, schedules and exhibits are to the same contained in this Lease.
1.2 INTERPRETATION.
The rules of usage set forth in Appendix A to the Participation
Agreement shall apply to this Lease.
ARTICLE II
2.1 PROPERTY.
Subject to the terms and conditions hereinafter set forth and
contained in the respective Lease Supplement relating to each Property, Lessor
hereby leases to Lessee and Lessee hereby leases from Lessor, each Property.
2.2 LEASE TERM.
The basic term of this Lease with respect to each Property (the
"Basic Term") shall begin upon the Property Closing Date for such Property (in
each case the "Basic Term Commencement Date") and shall end on the fifth (5th)
annual anniversary of the Initial Closing Date (the "Basic Term Expiration
Date"), unless the Basic Term is earlier terminated or the term of this Lease is
renewed (as described below) in accordance with the provisions of this Lease.
Notwithstanding the foregoing, Lessee shall not be obligated to pay Basic Rent
until the Rent Commencement Date with respect to such Property.
Upon the written request of Lessee and with the consent of all of
the Financing Parties, in their sole discretion, the term of this Lease for each
Property may be extended for up to two (2) additional terms each of one (1)
year's duration from the Basic Term Expiration Date (each, a "Renewal Term");
provided, that the expiration date for the final Renewal Term for each Property
shall not be later than the seventh (7th) annual anniversary of the Initial
Closing Date, unless such later expiration date has been expressly agreed to, at
the request of Lessee, in writing by each of Lessor, the Agent, the Lenders and
the Holders in their sole discretion.
2.3 TITLE.
Each Property is leased to Lessee without any representation or
warranty, express or implied, by Lessor and subject to the rights of parties in
possession (if any), the existing state of title (including without limitation
the Permitted Liens) and all applicable Legal Requirements. Lessee shall in no
event have any recourse against Lessor for any defect in Lessor's title to any
Property or any interest of Lessee therein other than for Lessor Liens.
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2.4 LEASE SUPPLEMENTS.
On or prior to each Basic Term Commencement Date, Lessee and Lessor
shall each execute and deliver a Lease Supplement for the Property to be leased
effective as of such Basic Term Commencement Date in substantially the form of
Exhibit A hereto.
ARTICLE III
3.1 RENT.
(a) Lessee shall pay Basic Rent in arrears on each Payment Date,
and on any date on which this Lease shall terminate with respect to any or
all Properties during the Term; provided, however, with respect to the
Properties in the aggregate Lessee shall have no obligation to pay Basic
Rent until the Rent Commencement Date (notwithstanding that Basic Rent for
such Property shall accrue from and including the Scheduled Interest
Payment Date immediately preceding such Rent Commencement Date).
(b) Each payment of Rent payable by Lessee to Lessor under this
Lease or any other Operative Agreement shall be made by Lessee to the
Agent as the designee of Lessor under Section 5.8 of the Participation
Agreement to such account or accounts as the Agent may designate from time
to time prior to 12:00 p.m., Charlotte, North Carolina time, in
immediately available funds consisting of lawful currency of the United
States of America on the date when such payment shall be due. Payments
received after 12:00 p.m., Charlotte, North Carolina time, on the date due
shall, for the purpose of Section 17.1 hereof be deemed received on such
day; provided, however, that for the purposes of the second sentence of
Section 3.3 hereof, such payments shall be deemed received on the next
succeeding Business Day and, unless the Agent is otherwise able to invest
or employ such funds on the date received, subject to interest at the
Overdue Rate.
(c) Lessee's inability or failure to take possession of all or any
portion of any Property when delivered by Lessor, whether or not
attributable to any act or omission of Lessor, the Construction Agent,
Lessee or any other Person or for any other reason whatsoever, shall not
delay or otherwise affect Lessee's obligation to pay Rent for such
Property in accordance with the terms of this Lease.
(d) On or prior to each Payment Date, Lessor shall deliver, or
cause to be delivered, to Lessee a notice of the exact amount of the Basic
Rent due on such date (the "Invoice"). For the purposes of this Section
3.1(d), delivery of the Invoice by facsimile transmission, receipt
confirmed, will be sufficient.
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3.2 PAYMENT OF BASIC RENT.
Basic Rent shall be paid absolutely net to Lessor or its designee,
so that this Lease shall yield to Lessor the full amount thereof, without
setoff, deduction or reduction.
3.3 SUPPLEMENTAL RENT.
Lessee shall pay to the Person entitled thereto any and all
Supplemental Rent when and as the same shall become due and payable, and if
Lessee fails to pay any Supplemental Rent within three (3) days after the same
is due, Lessor shall have all rights, powers and remedies provided for herein or
by law or equity or otherwise in the case of nonpayment of Basic Rent. All such
payments of Supplemental Rent shall be in the full amount thereof, without
setoff, deduction or reduction. Lessee shall pay to the appropriate Person, as
Supplemental Rent due and owing to such Person, among other things, on demand,
(a) any and all payment obligations (except for amounts payable as Basic Rent)
owing from time to time under the Operative Agreements by any Person to the
Agent, any Lender, any Holder or any other Person, (b) interest at the
applicable Overdue Rate on any installment of Basic Rent not paid when due
(subject to the applicable grace period) for the period for which the same shall
be overdue and on any payment of Supplemental Rent not paid when due or demanded
by the appropriate Person (subject to any applicable grace period) for the
period from the due date or the date of any such demand, as the case may be,
until the same shall be paid and (c) amounts referenced as Supplemental Rent
obligations pursuant to Section 8.3 of the Participation Agreement. The
expiration or other termination of Lessee's obligations to pay Basic Rent
hereunder shall not limit or modify the obligations of Lessee with respect to
Supplemental Rent. Unless expressly provided otherwise in this Lease, in the
event of any failure on the part of Lessee to pay and discharge any Supplemental
Rent as and when due, Lessee shall also promptly pay and discharge any fine,
penalty, interest or cost which may be assessed or added for nonpayment or late
payment of such Supplemental Rent, all of which shall also constitute
Supplemental Rent. During the Construction Period, such Impositions and utility
charges shall be included in the Property Cost to be paid by Lessor; provided,
however the Lessor shall pay such amounts described in this Section 3.3 only if
funds are made available by the Lenders and the Holders in an amount sufficient
to allow such payment.
3.4 PERFORMANCE ON A NON-BUSINESS DAY.
If any Basic Rent is required hereunder on a day that is not a
Business Day, then such Basic Rent shall be due on the corresponding Scheduled
Interest Payment Date. If any Supplemental Rent is required hereunder on a day
that is not a Business Day, then such Supplemental Rent shall be due on the next
succeeding Business Day.
3.5 RENT PAYMENT PROVISIONS.
Lessee shall make payment of all Basic Rent and Supplemental Rent
when due (subject to the applicable grace periods) regardless of whether any of
the Operative Agreements pursuant to which same is calculated and is owing shall
have been rejected, avoided or
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disavowed in any bankruptcy or insolvency proceeding involving any of the
parties to any of the Operative Agreements. Such provisions of such Operative
Agreements and their related definitions are incorporated herein by reference
and shall survive any termination, amendment or rejection of any such Operative
Agreements.
ARTICLE IV
4.1 TAXES; UTILITY CHARGES.
Subject to Lessee's rights of permitted contest pursuant to Section
13.1, Lessee shall pay or cause to be paid all Impositions with respect to the
Properties and/or the use, occupancy, operation, repair, access, maintenance or
operation thereof and all charges for electricity, power, gas, oil, water,
telephone, sanitary sewer service and all other rents, utilities and operating
expenses of any kind or type used in or on any Property and related real
property during the Term. Upon Lessor's request, Lessee shall provide from time
to time Lessor with evidence of all such payments referenced in the foregoing
sentence. Lessee shall be entitled to receive any credit or refund with respect
to any Imposition or utility charge paid by Lessee. Unless an Event of Default
shall have occurred and be continuing, the amount of any credit or refund
received by Lessor on account of any Imposition or utility charge paid by
Lessee, net of the costs and expenses incurred by Lessor in obtaining such
credit or refund, shall be promptly paid over to Lessee. All charges for
Impositions or utilities imposed with respect to any Property for a period
during which this Lease expires or terminates shall be adjusted and prorated on
a daily basis between Lessor and Lessee, and each party shall pay or reimburse
the other for such party's pro rata share thereof. During the Construction
Period, the costs of Impositions and all other utility and other charges or
expenses referenced in this Section 4.1 shall be paid by Lessor; provided,
however, the Lessor shall pay such amounts described in this Section 4.1 only if
funds are made available by the Lenders and the Holders in an amount sufficient
to allow such payment.
ARTICLE V
5.1 QUIET ENJOYMENT.
Subject to the rights of Lessor contained in Sections 17.2, 17.3 and
20.3 and the other terms of this Lease and the other Operative Agreements and so
long as no Event of Default shall have occurred and be continuing, Lessee shall
peaceably and quietly have, hold and enjoy each Property for the applicable
Term, free of any claim or other action by Lessor or anyone rightfully claiming
by, through or under Lessor (other than Lessee) with respect to any matters
arising from and after the applicable Basic Term Commencement Date.
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ARTICLE VI
6.1 Net Lease.
This Lease shall constitute a net lease, and the obligations of
Lessee hereunder are absolute and unconditional. Lessee shall pay all operating
expenses arising out of the use, operation and/or occupancy of each Property.
Any present or future law to the contrary notwithstanding, this Lease shall not
terminate, nor shall Lessee be entitled to any abatement, suspension, deferment,
reduction, setoff, counterclaim, or defense with respect to the Rent, nor shall
the obligations of Lessee hereunder be affected (except as expressly herein
permitted and by performance of the obligations in connection therewith) for any
reason whatsoever, including without limitation by reason of: (a) any damage to
or destruction of any Property or any part thereof; (b) any taking of any
Property or any part thereof or interest therein by Condemnation or otherwise;
(c) any prohibition, limitation, restriction or prevention of Lessee's use,
occupancy or enjoyment of any Property or any part thereof, or any interference
with such use, occupancy or enjoyment by any Person or for any other reason; (d)
any title defect, Lien or any matter affecting title to any Property; (e) any
eviction by paramount title or otherwise; (f) any default by Lessor hereunder;
(g) any action for bankruptcy, insolvency, reorganization, liquidation,
dissolution or other proceeding relating to or affecting the Agent, any Lender,
Lessor, Lessee, any Holder or any Governmental Authority; (h) the impossibility
or illegality of performance by Lessor, Lessee or both; (i) any action of any
Governmental Authority or any other Person, Lessee's acquisition of ownership of
all or part of any Property (except for any such acquisition of ownership
pursuant to and in accordance with the terms of this Lease); (k) breach of any
warranty or representation with respect to any Property or any Operative
Agreement; (1) any defect in the condition, quality or fitness for use of any
Property or any part thereof; or (m) any other cause or circumstance whether
similar or dissimilar to the foregoing and whether or not Lessee shall have
notice or knowledge of any of the foregoing. Notwithstanding the foregoing
provisions, nothing contained in this Section 6.1 shall provide Lessor with any
right to payment by Lessee under this Lease prior to the Completion Date which
is contrary to Lessor's remedies under the Agency Agreement; it being the
express intention of the parties hereto that Lessee's liability hereunder shall
not exceed the liability of the Construction Agent under the Agency Agreement
prior to the Completion Date. The parties intend that the obligations of Lessee
hereunder shall be covenants, agreements and obligations that are separate and
independent from any obligations of Lessor hereunder and shall continue
unaffected unless such covenants, agreements and obligations shall have been
modified or terminated in accordance with an express provision of this Lease.
Lessor and Lessee acknowledge and agree that the provisions of this Section 6.1
have been specifically reviewed and subjected to negotiation.
6.2 NO TERMINATION OR ABATEMENT.
Lessee shall remain obligated under this Lease in accordance with
its terms and shall not take any action to terminate, rescind or avoid this
Lease, notwithstanding any action for bankruptcy, insolvency, reorganization,
liquidation, dissolution, or other proceeding affecting any Person or any
Governmental Authority, or any action with respect to this Lease or any
Operative Agreement which may be taken by any trustee, receiver or liquidator of
any Person or
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any Governmental Authority or by any court with respect to any Person, or any
Governmental Authority. Lessee hereby waives all right (a) to terminate or
surrender this Lease (except as permitted hereunder or under the terms of the
Operative Agreements) or (b) to avail itself of any abatement, suspension,
deferment, reduction, setoff, counterclaim or defense with respect to any Rent.
Lessee shall remain obligated under this Lease in accordance with its terms and
Lessee hereby waives any and all rights now or hereafter conferred by statute or
otherwise to modify or avoid strict compliance with its obligations under this
Lease. Notwithstanding any such statute or otherwise, Lessee shall be bound by
all of the terms and conditions contained in this Lease.
ARTICLE VII
7.1 OWNERSHIP OF THE PROPERTIES.
(a) Lessor and Lessee intend that for federal and all state and
local income tax purposes, bankruptcy purposes, regulatory purposes,
commercial law and real estate purposes and all other purposes (A) this
Lease will be treated as a financing arrangement, (B) Lessee will be
treated as the beneficial owner of the Properties and will be entitled to
all tax benefits ordinarily available to owners of property similar to the
Properties for such tax purposes and (C) this Lease will be treated as an
operating lease for financial statement reporting purposes.
Notwithstanding the foregoing, neither party hereto has made, or shall be
deemed to have made, any representation or warranty as to the availability
of any of the foregoing treatments under applicable accounting rules, tax,
bankruptcy, regulatory, commercial or real estate law or under any other
set of rules. Lessee shall claim the cost recovery deductions associated
with each Property, and Lessor shall not, to the extent not prohibited by
Law, take on its tax return a position inconsistent with Lessee's claim of
such deductions.
(b) For all purposes described in Section 7.1 (a), Lessor and
Lessee intend this Lease to constitute a finance lease and not a true
lease. In order to secure the obligations of Lessee now existing or
hereafter arising under any and all Operative Agreements, Lessee hereby
conveys, grants, assigns, transfers, hypothecates, mortgages and sets over
to Lessor, for the benefit of all Financing Parties, a first priority
security interest (but subject to the security interest in the assets
granted by Lessee in favor of the Agent in accordance with the Security
Agreement) in and lien on all right, title and interest of Lessee (now
owned or hereafter acquired) in and to all Properties to the extent such
is personal property and irrevocably grants and conveys a lien, deed of
trust and mortgage on all right, title and interest of Lessee (now owned
or hereafter acquired) in and to all Properties to the extent such is a
real property. Lessor and Lessee further intend and agree that, for the
purpose of securing the obligations of Lessee and/or the Construction
Agent now existing or hereafter arising under the Operative Agreements,
(i) this Lease shall be a security agreement and financing statement
within the meaning of Article 9 of the Uniform Commercial Code respecting
each of the Properties and all proceeds (including without limitation
insurance proceeds thereof) to the extent such is personal
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property and an irrevocable grant and conveyance of a lien, deed of trust
and mortgage on each of the Properties and all proceeds (including without
limitation insurance proceeds thereof) to the extent such is real
property; (ii) the acquisition of title by Lessor in each Property
referenced in Article II constitutes a grant by Lessee to Lessor of a
security interest, lien, deed of trust and mortgage in all of Lessee's
right, title and interest in and to each Property and all proceeds
(including without limitation insurance proceeds thereof) of the
conversion, voluntary or involuntary, of the foregoing into cash,
investments, securities or other property, whether in the form of cash,
investments, securities or other property, and an assignment of all rents,
profits and income produced by each Property; and (iii) notifications to
Persons holding such property, and acknowledgments, receipts or
confirmations from financial intermediaries, bankers or agents (as
applicable) of Lessee shall be deemed to have been given for the purpose
of perfecting such lien, security interest, mortgage lien and deed of
trust under applicable law. Lessee shall promptly take such actions as
Lessor may reasonably request (including without limitation the filing of
Uniform Commercial Code Financing Statements, Uniform Commercial Code
Fixture Filings and memoranda (or short forms) of this Lease and the
various Lease Supplements) to ensure that the lien, security interest,
lien, mortgage lien and deed of trust in each Property and the other items
referenced above will be deemed to be a perfected lien, security interest,
mortgage lien and deed of trust of first priority under applicable law and
will be maintained as such throughout the Term.
ARTICLE VIII
8.1 CONDITION OF THE PROPERTIES.
LESSEE ACKNOWLEDGES AND AGREES THAT IT IS LEASING EACH PROPERTY
"AS-IS WHERE-IS" WITHOUT REPRESENTATION, WARRANTY OR COVENANT (EXPRESS OR
IMPLIED) BY LESSOR (EXCEPT THAT LESSOR SHALL KEEP EACH PROPERTY FREE AND CLEAR
OF LESSOR LIENS) AND IN EACH CASE SUBJECT TO (A) THE EXISTING STATE OF TITLE,
(B) THE RIGHTS OF ANY PARTIES IN POSSESSION THEREOF (IF ANY), (C) ANY STATE OF
FACTS REGARDING ITS PHYSICAL CONDITION OR WHICH AN ACCURATE SURVEY MIGHT SHOW,
(D) ALL APPLICABLE LEGAL REQUIREMENTS AND (E) VIOLATIONS OF LEGAL REQUIREMENTS
WHICH MAY EXIST ON THE DATE HEREOF AND/OR THE DATE OF THE APPLICABLE LEASE
SUPPLEMENT. NEITHER LESSOR NOR THE AGENT NOR ANY LENDER NOR ANY HOLDER HAS MADE
OR SHALL BE DEEMED TO HAVE MADE ANY REPRESENTATION, WARRANTY OR COVENANT
(EXPRESS OR IMPLIED) (EXCEPT THAT LESSOR SHALL KEEP EACH PROPERTY FREE AND CLEAR
OF LESSOR LIENS) OR SHALL BE DEEMED TO HAVE ANY LIABILITY WHATSOEVER AS TO THE
TITLE, VALUE, HABITABILITY, USE, CONDITION, DESIGN, OPERATION, MERCHANTABILITY
OR FITNESS FOR USE OF ANY PROPERTY (OR ANY PART THEREOF), OR ANY OTHER
REPRESENTATION, WARRANTY OR COVENANT WHATSOEVER, EXPRESS OR IMPLIED, WITH
RESPECT
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TO ANY PROPERTY (OR ANY PART THEREOF), AND NEITHER LESSOR NOR THE AGENT NOR ANY
LENDER NOR ANY HOLDER SHALL BE LIABLE FOR ANY LATENT, HIDDEN, OR PATENT DEFECT
THEREON OR THE FAILURE OF ANY PROPERTY, OR ANY PART THEREOF, TO COMPLY WITH ANY
LEGAL REQUIREMENT. LESSEE HAS OR PRIOR TO THE BASIC TERM COMMENCEMENT DATE WILL
HAVE BEEN AFFORDED FULL OPPORTUNITY TO INSPECT EACH PROPERTY AND THE
IMPROVEMENTS THEREON (IF ANY), IS OR WILL BE (INSOFAR AS LESSOR, THE AGENT, EACH
LENDER AND EACH HOLDER ARE CONCERNED) SATISFIED WITH THE RESULTS OF ITS
INSPECTIONS AND IS ENTERING INTO THIS LEASE SOLELY ON THE BASIS OF THE RESULTS
OF ITS OWN INSPECTIONS, AND ALL RISKS INCIDENT TO THE MATTERS DESCRIBED IN THE
PRECEDING SENTENCE, AS BETWEEN LESSOR, THE AGENT, THE LENDERS AND THE HOLDERS,
ON THE ONE HAND, AND LESSEE, ON THE OTHER HAND, ARE TO BE BORNE BY LESSEE.
8.2 POSSESSION AND USE OF THE PROPERTIES.
(a) At all times following the Completion Date, the Properties in
the aggregate shall constitute a Permitted Facility and shall be used by
Lessee in the ordinary course of its business. Lessee shall pay, or cause
to be paid, all charges and costs required in connection with the use of
the Properties as contemplated by this Lease. Lessee shall not commit or
permit any waste of the Properties or any part thereof.
(b) The address stated in Section 6.2(i) of the Participation
Agreement is the principal place of business and chief executive office of
Lessee (as such terms are used in Section 9-103(3) of the Uniform
Commercial Code of any applicable jurisdiction), and Lessee will provide
Lessor with prior written notice of any change of location of its
principal place of business or chief executive office. Regarding a
particular Property, each Lease Supplement correctly identifies the
initial location of the related Equipment (if any) and Improvements (if
any) and contains an accurate legal description for the related parcel of
Land. The Equipment and Improvements respecting each particular Property
will be located only at the location identified in the applicable Lease
Supplement.
(c) Lessee will not attach or incorporate any item of Equipment to
or in any other item of equipment or personal property or to or in any
real property in a manner that could give rise to the assertion of any
Lien (in favor of a third party that is prior to the Liens thereon created
by the Operative Agreements) on such item of Equipment by reason of such
attachment or the assertion of a claim that such item of Equipment has
become a fixture and is subject to a Lien in favor of a third party that
is prior to the Liens thereon created by the Operative Agreements.
(d) On the Basic Term Commencement Date for each Property, Lessor
and Lessee shall execute a Lease Supplement in regard to such Property
which shall contain an Equipment Schedule that has a general description
of the Equipment (if any) which
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shall comprise the Property, an Improvement Schedule that has a general
description of the Improvements (if any) which shall comprise the Property
and a legal description of the Land (if any) which shall comprise the
Property. Simultaneously with the execution and delivery of each Lease
Supplement, such Equipment, Improvements, Land, all additional Equipment
and all additional Improvements which are financed under the Operative
Agreements after the Basic Term Commencement Date and the remainder of
such Property shall be deemed to have been accepted by Lessee for all
purposes of this Lease and to be subject to this Lease.
(e) At all times during the Term with respect to each Property,
Lessee will comply with all obligations under and (to the extent no Event
of Default exists and provided that such exercise will not impair the
value, utility or remaining useful life of such Property) shall be
permitted to exercise all rights and remedies under, all operation and
easement agreements and related or similar agreements applicable to such
Property.
8.3 INTEGRATED PROPERTIES.
On the Rent Commencement Date for each Property, Lessee shall, at
its sole cost and expense, cause all Properties in the aggregate to constitute
(and for the duration of the Term shall continue to constitute) all of the
equipment, facilities, rights, other personal property and other real property
necessary or appropriate to operate, utilize, maintain and control a Permitted
Facility in a commercially reasonable manner.
ARTICLE IX
9.1 COMPLIANCE WITH LEGAL REQUIREMENTS, INSURANCE REQUIREMENTS AND
MANUFACTURER'S SPECIFICATIONS AND STANDARDS.
Subject to the terms of Article XIII relating to permitted contests,
Lessee, at its sole cost and expense, shall (a) comply with all applicable Legal
Requirements (including without limitation all Environmental Laws (except as set
forth in Section 15.2)) and all Insurance Requirements relating to the
Properties, (b) procure, maintain and comply with all licenses, permits, orders,
approvals, consents and other authorizations required for the acquisition,
installation, testing, use, development, construction, operation, maintenance,
repair, refurbishment and restoration of the Properties and (c) comply with all
manufacturer's specifications and standards, including without limitation the
acquisition, installation, testing, use, development, construction, operation,
maintenance, repair, refurbishment and restoration of the Properties, whether or
not compliance therewith shall require structural or extraordinary changes in
any Property or interfere with the use and enjoyment of any Property, unless the
failure to procure, maintain and comply with such items identified in
subparagraphs (b) and (c), individually or in the aggregate, shall not have and
could not reasonably be expected to have a Material Adverse Effect. Lessor
agrees to take such actions as may be reasonably requested by Lessee in
connection with the compliance by Lessee of its obligations under this Section
9.1. Notwithstanding the foregoing, Lessee shall be deemed to be in compliance
with all
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Environmental Laws for purposes of this Lease notwithstanding any Environmental
Violation if the severity of such Environmental Violation is less than federal,
state and local standards requiring remediation or removal or, if such standards
are exceeded, remediation or removal is proceeding in accordance with all
applicable Environmental Laws.
ARTICLE X
10.1 MAINTENANCE AND REPAIR; RETURN.
(a) Lessee, at its sole cost and expense, shall maintain each
Property in good condition, repair and working order (ordinary wear and
tear excepted) and make all necessary repairs thereto and replacements
thereof, of every kind and nature whatsoever, whether interior or
exterior, ordinary or extraordinary, structural or nonstructural or
foreseen or unforeseen, in each case as required by Section 9.1 and on a
basis consistent with the operation and maintenance of properties or
equipment comparable in type and function to the applicable Property, such
that such Property is capable of being immediately utilized by a third
party and in compliance with standard industry practice subject, however,
to the provisions of Article XV with respect to Casualty and Condemnation.
(b) Lessee shall not use or locate any component of any Property
outside of the Approved State therefor. Lessee shall not move or relocate
any component of any Property beyond the boundaries of the Land described
in the Lease Supplement with regard to the Land, except for the temporary
removal of Equipment and other personal property for repair or
replacement.
(c) If any component of any Property becomes worn out, lost,
destroyed, damaged beyond repair or otherwise permanently rendered unfit
for use, Lessee, at its own expense, will within a reasonable time replace
such component with a replacement component which is free and clear of all
Liens (other than Permitted Liens and Lessor Liens) and has a value,
utility and useful life at least equal to the component replaced (assuming
the component replaced had been maintained and repaired in accordance with
the requirements of this Lease). Except as otherwise provided in Section
11.1, all components which are added to any Property shall immediately
become the property of (and title thereto shall vest in) Lessor and shall
be deemed incorporated in such Property and subject to the terms of this
Lease as if originally leased hereunder.
(d) Upon reasonable advance notice, Lessor and its agents shall
have the right to inspect each Property and all maintenance records with
respect thereto at any reasonable time during normal business hours but
shall not, in the absence of an Event of Default, materially disrupt the
business of Lessee.
(e) Lessee shall cause to be delivered to Lessor (at Lessee's sole
expense) one or more additional Appraisals (or reappraisals of Property)
as Lessor may request if any
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one of Lessor, the Agent, the Trust Company, any Lender or any Holder is
required pursuant to any applicable Legal Requirement to obtain such
Appraisals (or reappraisals) and upon the occurrence of any Event of
Default.
(f) Lessor shall under no circumstances be required to build any
improvements or install any equipment on any Property, make any repairs,
replacements, alterations or renewals of any nature or description to any
Property, make any expenditure whatsoever in connection with this Lease or
maintain any Property in any way. Lessor shall not be required to
maintain, repair or rebuild all or any part of any Property, and Lessee
waives the right to (i) require Lessor to maintain, repair, or rebuild all
or any part of any Property, or (ii) make repairs at the expense of Lessor
pursuant to any Legal Requirement, Insurance Requirement, contract,
agreement, covenant, condition or restriction at any time in effect.
(g) Lessee shall, upon the expiration or earlier termination of
this Lease with respect to a Property, if Lessee shall not have exercised
its Purchase Option with respect to such Property and purchased such
Property, surrender such Property (i) pursuant to the exercise of the
applicable remedies upon the occurrence of a Lease Event of Default, to
Lessor or (iii) pursuant to the second paragraph of Section 22.1(a)
hereof, to Lessor or the third party purchaser, as the case may be,
subject to Lessee's obligations under this Lease (including without
limitation the obligations of Lessee at the time of such surrender under
Sections 9.1, 10.1(a) through (f), 10.2, 11.1, 12.1, 22.1 and 23.1).
10.2 ENVIRONMENTAL INSPECTION.
If Lessee has not given notice of exercise of its Purchase Option on
the Expiration Date pursuant to Section 20.1 or for whatever reason Lessee does
not purchase a Property in accordance with the terms of this Lease, then not
more than one hundred twenty (120) days nor less than sixty (60) days prior to
the Expiration Date, Lessee shall cause to be delivered to Lessor environmental
site assessments recently prepared (no more than thirty (30) days prior to the
date of delivery) by an independent recognized professional reasonably
acceptable to Lessor, and in form, scope and content reasonably satisfactory to
Lessor. The cost incurred respecting such environmental site assessments shall
be paid for in accordance with the provisions set forth in Section 20.3(b).
ARTICLE XI
11.1 MODIFICATIONS.
(a) Lessee at its sole cost and expense, at any time and from time
to time without the consent of Lessor may make modifications, alterations,
renovations, improvements and additions to any Property or any part
thereof and substitutions and replacements therefor (collectively,
"Modifications"), and Lessee shall make any and all Modifications required
to be made pursuant to all Legal Requirements, Insurance
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Requirements and manufacturer's specifications and standards; provided,
that: (i) no Modification shall materially impair the value, utility or
useful life of any Property from that which existed immediately prior
to such Modification; (ii) each Modification shall be done
expeditiously and in a good and workmanlike manner; (iii) no
Modification shall adversely affect the structural integrity of any
Property; (iv) to the extent required by Section 14.2(a), Lessee shall
maintain builders' risk insurance at all times when a Modification is
in progress; (v) subject to the terms of Article XIII relating to
permitted contests, Lessee shall pay all costs and expenses and
discharge any Liens arising with respect to any Modification; (vi) each
Modification shall comply with the requirements of this Lease
(including without limitation Sections 8.2 and 10.1); and (vii) except
as otherwise contemplated or provided in any Operative Agreement, no
Improvement shall be demolished or otherwise rendered unfit for use
unless Lessee shall finance the proposed replacement Modification
outside of this lease facility; provided, further, Lessee shall not
make any Modification (unless required by any Legal Requirement) to the
extent any such Modification, individually or in the aggregate, shall
have or could reasonably be expected to have a Material Adverse Effect.
Lessee shall not remove or attempt to remove any Modification from any
Property. Title to each Modification shall vest in Lessee to the extent
such Modification (a) is not financed pursuant to the Operative
Agreements, (b) is not a fixture or other real estate interest, (c) is
readily removable without causing material damage to any Property, (d)
is not required in order for the applicable Property to comply with any
Legal Requirement, any Insurance Requirement or any requirement of
Section 8.3 of this Lease and (e) is not necessary to conform to any
applicable manufacturer's specification and/or standard. Title to all
other Modifications shall immediately and without further action upon
their incorporation into the applicable Property (1) become property of
Lessor, (2) be subject to this Lease and (3) be titled in the name of
Lessor. Lessee at its sole cost and expense shall repair in a good and
workmanlike manner any and all damage done to any Property due to the
removal, detachment, attempted removal or attempted detachment of any
Modification from a Property and all such repairs shall be completed by
the earlier of (a) thirty (30) days after such removal, detachment,
attempted removal or attempted detachment of the applicable
Modification from the applicable Property and (b) the Expiration Date.
Lessee shall not remove, detach or attempt to remove or detach any
Modification from any Property except in accordance with the provisions
of this Section 11.1. The Lessor acknowledges Lessee's right to
finance and to secure under the Uniform Commercial Code, inventory,
furnishings, furniture, equipment, machinery, leasehold improvements
and other personal property located at the Properties, other than the
Equipment and modifications required to be titled in the name of Lessor
and excluding in all cases fixtures, and Lessor agrees, at Lessee's
cost and expenses, to execute Lessor waiver forms, releases of Lessor
Liens and other similar documentation (in form and substance reasonably
satisfactory to Lessor and the Agent) in favor or any purchase money
seller, lessor or lender who has financed or may finance in the future
such items.
(b) The construction process provided for in the Agency
Agreement is acknowledged by Lessor to be consistent with and in
compliance with the terms and provisions of this Article XI.
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appurtenance thereto is the subject of a Condemnation; provided,
however, if a Material Default or an Event of Default shall have
occurred and be continuing or if such award, compensation or insurance
proceeds shall exceed $1,000,000, then such award, compensation or
insurance proceeds shall be paid directly to Lessor or, if received by
Lessee, shall be held in trust for Lessor, and shall be paid over by
Lessee to Lessor and held in accordance with the terms of this Article
XV or, if applicable. applied to the repayment of the Property Cost in
accordance with Section 16 on the Termination Date. All amounts held by
Lessor hereunder on account of any award, compensation or insurance
proceeds either paid directly to Lessor or turned over to Lessor shall
be held as security for the performance of Lessee's obligations
hereunder and under the other Operative Agreements and when all such
obligations of Lessee with respect to such matters (and all other
obligations of Lessee which should have been satisfied pursuant to the
Operative Agreements as of such date) have been satisfied, all amounts
so held by Lessor shall be paid over to Lessee.
(b) Lessee may appear in any proceeding or action to
negotiate, prosecute, adjust or appeal any claim for any award,
compensation or insurance payment on account of any such Casualty or
Condemnation and shall pay all expenses thereof; provided, that during
the Construction Period, such expenses shall be paid by Lessor;
provided, further the Lessor shall pay such amounts described in this
Section 15.1(b) only if funds are made available by the Lenders and the
Holders in an amount sufficient to allow such payment. At Lessee's
reasonable request, and at Lessee's sole cost and expense, Lessor and
the Agent shall participate in any such proceeding, action,
negotiation, prosecution or adjustment; provided, that during the
Construction Period, such expenses shall be paid by Lessor; provided,
further, the Lessor shall pay such amounts described in this Section
15.1(b) only if funds are made available by the Lenders and the Holders
in an amount sufficient to allow such payment. Lessor and Lessee agree
that this Lease shall control the rights of Lessor and Lessee in and to
any such award, compensation or insurance payment.
(c) If Lessee shall receive notice of a Casualty or a
Condemnation of a Property or any interest therein where damage to the
affected Property is estimated to equal or exceed twenty-five percent
(25%) of the Property Cost of such Property, Lessee shall give notice
thereof to Lessor promptly after Lessee's receipt of such notice. In
the event such a Casualty or Condemnation occurs (regardless of whether
Lessee gives notice thereof), then Lessee shall be deemed to have
delivered a Termination Notice to Lessor and the provisions of Sections
16.1 and 16.2 shall apply.
(d) In the event of a Casualty or a Condemnation (regardless
of whether notice thereof must be given pursuant to paragraph (c)),
this Lease shall terminate with respect to the applicable Property in
accordance with Section 16.1 if Lessee, within thirty (30) days after
such occurrence, delivers to Lessor a notice to such effect.
(e) If pursuant to this Section 15.1 this Lease shall continue
in full force and effect following a Casualty or Condemnation with
respect to the affected Property,
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Lessee shall, at its sole cost and expense (subject to reimbursement in
accordance with Section 15.1(a)) promptly and diligently repair any
damage to the applicable Property caused by such Casualty or
Condemnation in conformity with the requirements of Sections 10.1 and
11.1. using the as-built Plans and Specifications or manufacturer's
specifications for the applicable Improvements, Equipment or other
components of the applicable Property (as modified to give effect to
any subsequent Modifications, any Condemnation affecting the applicable
Property and all applicable Legal Requirements). so as to restore the
applicable Property to the same or a greater remaining economic value,
useful life, utility, condition, operation and function as existed
immediately prior to such Casualty or Condemnation (assuming all
maintenance and repair standards have been satisfied). In such event,
title to the applicable Property shall remain with Lessor. Lessor shall
make disbursements from time to time of any award, compensation or
insurance proceeds held by it to Lessee for application to the cost of
restoration subject to the satisfaction of the following conditions:
(1) Lessor shall have received a fully executed counterpart of a
requisition therefor (in form and substance reasonably satisfactory to
Lessor), requesting funds in an amount not exceeding the cost of work
completed or insured since the last disbursement, together with
reasonably satisfactory evidence of the state of completion and of
performance of the work in a good and ▇▇▇▇▇▇▇-like manner and in
accordance with the as-built Plans and Specifications, (ii) at the time
of any such disbursement, no Lease Default or Lease Event of Default
shall have occurred and be continuing, and no mechanic's or
materialmen's liens shall have been filed and remain undischarged,
except those discharged by the disbursement of the requested funds or
which are otherwise bonded, (iii) Lessor shall be reasonably satisfied
that sufficient funds are available to complete such restoration and
(iv) Lessor shall have good and marketable title to all Properties,
subject only to Permitted Liens. Provided no Lease Default or Lease
Event of Default shall have occurred and be continuing, any award,
compensation or insurance proceeds remaining after restoration of any
Property as herein provided shall be paid to Lessee.
(f) In no event shall a Casualty or Condemnation affect
Lessee's obligations to pay Rent pursuant to Article III.
(g) Notwithstanding anything to the contrary set forth in
Section 15.1(a) or Section 15.1(e), if during the Term with respect to
a Property a Casualty occurs with respect to such Property or Lessee
receives notice of a Condemnation with respect to such Property, and
following such Casualty or Condemnation, the applicable Property cannot
reasonably be restored, repaired or replaced on or before the day one
hundred eighty (180) days prior to the Expiration Date or the date nine
(9) months after the occurrence of such Casualty or Condemnation (if
such Casualty or Condemnation occurs during the Term) to the same or a
greater remaining economic value, useful life, utility, condition,
operation and function as existed immediately prior to such Casualty or
Condemnation (assuming all maintenance and repair standards have been
satisfied) or on or before such day such Property is not in fact so
restored, repaired or replaced, then Lessee shall be required to
exercise its Purchase Option for such Property on the next Payment Date
(notwithstanding the limits on such exercise contained in Section 20.2)
and pay Lessor
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the Termination Value for such Property; provided, if any Default or
Event of Default has occurred and is continuing, Lessee shall also
promptly (and in any event within three (3) Business Days) pay Lessor
any award, compensation or insurance proceeds received on account of
any Casualty or Condemnation with respect to any Property; provided,
further, that if no Material Default or Event of Default has occurred
and is continuing, any Excess Proceeds shall be paid to Lessee. If a
Material Default or an Event of Default has occurred and is continuing
and any Loans, Holder Advances or other amounts are owing with respect
thereto, then any Excess Proceeds (to the extent of any such Loans,
Holder Advances or other amounts owing with respect thereto) shall be
paid to Lessor, held as security for the performance of Lessee's
obligations hereunder and under the other Operative Agreements and
applied to such obligations upon the exercise of remedies in connection
with the occurrence of an Event of Default, with the remainder of such
Excess Proceeds in excess of such Loans, Holder Advances and other
amounts owing with respect thereto being distributed to the Lessee.
(h) The provisions of Sections 15.1(a) through 15.1(g) shall
not apply to any Property until after the Construction Period
Termination Date applicable to such Property and the applicable
provisions of the Agency Agreement shall apply to a Casualty or
Condemnation affecting a Construction Period Property.
15.2 ENVIRONMENTAL MATTERS.
(a) Lessee hereby acknowledges and confirms that, as of the
Property Closing Date, the Property (which includes Land) is
contaminated by Hazardous Substances including, but not limited to, the
Pre-Existing Hazardous Substances semiconductor related contamination
("TCE") and ten other compounds (the "Pre-Existing Hazardous
Substances") in concentrations and conditions that constitute an
Environmental Violation. In particular, Lessee acknowledges and
confirms the following facts with regard to the Property (which
includes the Land); provided remediation plans are in effect with
respect thereto which bring such Property (which includes the Land)
into compliance with the applicable Environmental Laws:
(i) In 1984, the California Regional Water Quality
Control Board issued cleanup orders to Raytheon, ▇▇▇▇▇▇▇▇▇
Semiconductor Corporation, Intel Corporation, NEC Electronics,
Inc. and Siltec Corporation with respect to PreExisting
Hazardous Substance contamination in the regional site known
as the Middlefield-▇▇▇▇▇-▇▇▇▇▇▇▇ (MEW) site (of which the
Property (which includes the Land) is a part). Three (3)
Superfund sites exist within the MEW area. The Environmental
Protection Agency ("EPA") is currently overseeing cleanup
measures that are being conducted on the Property (which
includes the Land) and neighboring properties. The Property
(which includes the Land) has been identified in EPA Orders as
containing sources of contamination including underground and
aboveground storage tanks for chemical products and wastes, pH
neutralization systems and industrial wastewater treatment
systems. The Property (which includes the Land) is listed on
the National Priorities List.
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(iii) In April 1985, the EPA issued a "Request for
Information" pursuant to Section 106(c) of CERCLA and took
over as the lead agency at the Property (which includes Land).
Raytheon, ▇▇▇▇▇▇▇▇▇ Semiconductor Corporation and Intel
Corporation entered an Administrative order on Consent with
the EPA on August 15, 1985 to conduct Remedial
Investigation/Feasibility Studies ("RI/FS") at the regional
site referred to above. The RI/FS was finalized in 1988. The
EPA issued a Record of Decision ("ROD") in May 1989. The ROD.
which was later modified in September 1990 and April 1996,
established specific cleanup concentrations for the
Pre-Existing Hazardous Substances, and required the
implementation of site-specific source control remediation
measures and a regional groundwater remediation program.
Raytheon and Intel Corporation entered into a Consent Decree
("CD") with the EPA in May 1991 that was entered by the United
States District Court, Northern District of California on
April 10. 1992.
(iii) The CD referred to above provides that Raytheon
will perform groundwater and soil remediation for the sites it
occupied and operated within the MEW area, including, but not
limited to, the Property (which includes the Land). The
facility specific work at the Property (which includes the
Land) is now in the operation and maintenance phase.
(iv) In 1987, a soil-bentonite, subsurface, slurry
wall was installed by Raytheon around the perimeter of the
Property (which includes the Land) enclosing the soil and
water bearing zones as part of the remedial measures.
Groundwater is extracted from the water bearing zones by
Raytheon within the area enclosed by the slurry wall
maintaining an inward and upward groundwater flow gradient to
keep contaminated groundwater from flowing away from the
Property (which includes the Land).
(v) The groundwater extraction and treatment system
was installed in 1987. Groundwater is extracted from several
▇▇▇▇▇ located both within the Property (which includes the
Land) boundaries and from adjacent property. The groundwater
extraction system is a long term remedial measure that
Raytheon is required to maintain. The groundwater extraction
system, soil vapor extraction system referred to below and
groundwater monitoring are ongoing at the Property (which
includes the Land) to remediate and monitor TCE and other
Pre-Existing Hazardous Substances.
(vi) A soil vapor extraction system was installed by
Raytheon in 1996 to remediate the contaminated soils in or
under the Property (which includes the Land). This system
covers a surface area of approximately four (4) acres and
proceeds to a depth of approximately 15 to 18 feet. The system
is composed of eighty-eight (88) shallow and deep soil vapor
extraction ▇▇▇▇▇ and one soil vapor
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extraction treatment system. Raytheon has petitioned and
obtained approval from the EPA for closure for part of the
soil vapor remedial system.
(b) In light of the environmental condition of the Property
(which includes the Land) existing as of the Property Closing Date (the
"Pre-Existing Environmental Conditions"), the presence of Pre-Existing
Hazardous Substances on the Property (which includes the Land) shall
not violate the terms of this Lease. Responsibility for the cleanup
and/or remediation of the Pre-Existing Environmental Conditions shall
be allocated pursuant to the terms of the Purchase Agreement and the
Indemnity Agreement: provided, notwithstanding any of the provisions of
the Lease or any of the Operative Agreements, to the extent any
Pre-Existing Environmental Condition is not addressed by, any third
party pursuant to the Purchase Agreement and/or the Indemnity Agreement
so as to remediate such Pre-Existing Environmental Condition in
accordance with the applicable Environmental Laws (and to indemnify the
Financing Parties in accordance with the requirements of the
Participation Agreement), then Lessee shall be responsible for (i) the
cleanup and/or remediation of such Pre-Existing Environmental Condition
in accordance with the applicable terms of the Operative Agreements
including without limitation Section 15.2(c) and (ii) the environmental
indemnification of the Financing Parties in accordance with the
Participation Agreement.
(c) Notwithstanding the foregoing, promptly upon Lessee's
actual knowledge of the presence of Hazardous Substances in any portion
of any Property or Properties (other than the Pre-Existing
Environmental Conditions) in concentrations and conditions that
constitute an Environmental Violation and which, in the reasonable
opinion of Lessee, the cost to undertake any legally required response,
clean up, remedial or other action will or might result in a cost to
Lessee of more than $50,000, Lessee shall notify Lessor in writing of
such condition. In the event of any Environmental Violation (regardless
of whether notice thereof must be given), Lessee shall, not later than
thirty (30) days after Lessee has actual knowledge of such
Environmental Violation, either deliver to Lessor a Termination Notice
with respect to the applicable Property or Properties pursuant to
Section 16. 1, if applicable, or, at Lessee's sole cost and expense,
promptly and diligently undertake and diligently complete any response,
clean up, remedial or other action (including without limitation the
pursuit by Lessee of appropriate action against any off-site or third
party source for contamination) necessary to remove. cleanup or
remediate the Environmental Violation in accordance with all
Environmental Laws; provided, notwithstanding the foregoing provision
of this sentence, Lessee shall only be responsible for Pre-Existing
Environmental Conditions to the extent set forth in Section 15.2(b) and
the other applicable provisions of the Operative Agreements. Any such
undertaking shall be timely completed in accordance with prudent
industry standards. If Lessee does not deliver a Termination Notice
with respect to such Property pursuant to Section 16.1, Lessee shall.,
upon completion of remedial action by Lessee, cause to be prepared by a
reputable environmental consultant acceptable to Lessor a report
describing the Environmental Violation and the actions taken by Lessee
(or its agents) in response to such Environmental Violation, and a
statement by the consultant that the Environmental Violation has been
remedied in full compliance with applicable
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Environmental Law. Not less than sixty (60) days prior to any time that
Lessee elects to cease operations with respect to any Property or to
remarket any Property pursuant to Section 20.1 hereof or any other
provision of any Operative Agreement, Lessee at its expense shall cause
to be delivered to Lessor environmental site assessments respecting such
Property recently prepared (no more than thirty (30) days prior to the
date of delivery) by an independent recognized professional acceptable
to Lessor in its reasonable discretion and in form, scope and content
satisfactory to Lessor in its reasonable discretion. Notwithstanding any
other provision of any Operative Agreement, if Lessee fails to comply
with the foregoing obligation regarding the environmental site
assessments, Lessee shall be obligated to purchase such Property for its
Termination Value and shall not be permitted to exercise (and Lessor
shall have no obligation to honor any such exercise) any rights under
any Operative Agreement regarding a sale of such Property to a Person
other than Lessee.
15.3 NOTICE OF ENVIRONMENTAL MATTERS.
Promptly, but in any event within five (5) Business Days from the
date Lessee has actual knowledge thereof, Lessee shall provide to Lessor
written notice of any pending or threatened claim, action or proceeding
involving any Environmental Law or any Release on or in connection with
any Property or Properties other than notices (provided to Lessor prior
to the Initial Closing Date) relating to the Pre-Existing Environmental
Conditions. All such notices shall describe in reasonable detail the
nature of the claim, action or proceeding and Lessee's proposed response
thereto. In addition, Lessee shall provide to Lessor, within five (5)
Business Days of receipt, copies of all material written communications
with any Governmental Authority relating to any Environmental Law in
connection with any Property. Lessee shall also promptly provide such
detailed reports of any such material environmental claims as may
reasonably be requested by Lessor.
ARTICLE XVI
16.1 TERMINATION UPON CERTAIN EVENTS.
If Lessee has delivered, or is deemed to have delivered, written
notice of a termination of this Lease with respect to the applicable
Property to Lessor in the form described in Section 16.2(a) (a
"Termination Notice") pursuant to the provisions of this Lease, then
following the applicable Casualty, Condemnation or Environmental
Violation (Provided, no such Termination Notice shall be deemed
delivered with respect to any Pre-Existing Environmental Condition),
this Lease shall terminate with respect to the affected Property on the
applicable Termination Date.
16.2 PROCEDURES.
(a) A Termination Notice shall contain: (i) notice of termination
of this Lease with respect to the affected Property on a Payment Date
not more than sixty (60) days
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after Lessor's receipt of such Termination Notice (the "Termination
Date"); and (ii) a binding and irrevocable agreement of Lessee to pay
the Termination Value for the applicable Property and purchase such
Property on such Termination Date.
(b) On each Termination Date, Lessee shall pay to Lessor the
Termination Value for the applicable Property, and Lessor shall convey
such Property or the remaining portion thereof, if any, to Lessee (or
Lessee's designee), all in accordance with Section 20.2.
ARTICLE XVII
17.1 LEASE EVENTS OF DEFAULT.
If any one (1) or more of the following events (each a "Lease
Event of Default") shall occur:
(a) Lessee shall fail to make payment of (i) any Basic Rent
(except as set forth in clause (ii)) within three (3) days after the
same has become due and payable or (ii) any Termination Value, on the
date any such payment is due and payable, or any payment of Basic Rent
or Supplemental Rent due on the due date of any such payment of
Termination Value, or (iii) any amount due on the Expiration Date;
(b) Lessee shall fail to make payment of any Supplemental Rent
(other than Supplemental Rent referred to in Section 17. 1 (a)(ii)) or
any other Credit Party shall fail to make any payment of any amount
under any Operative Agreement which has become due and payable within
three (3) days after receipt of notice that such payment is due;
(c) (i) Lessee shall fail to maintain insurance as required by
Article XIV of this Lease or (ii) Lessee shall fail to deliver any
requisite ACCORD Evidence of Insurance or certified copy of any
insurance policy required thereunder when due under the terms hereof and
such failure to deliver shall continue unremedied for a period of ten
(10) days after an officer of Lessee becoming aware of such failure to
deliver, or notice from the Agent of such failure to deliver;
(d) Any representation or warranty made by Lessee set forth in
this Lease or in any other Operative Agreement or in any document
entered into in connection herewith or therewith or in any document,
certificate or financial or other statement delivered in connection
herewith or therewith shall be false or inaccurate in any material way
when made;
(e) An Agency Agreement Event of Default shall have occurred and
be continuing;
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(f) Any Credit Party or any Subsidiary of any Credit Party
shall default (beyond applicable periods of grace and/or notice and
cure) in the payment when due of any principal of or interest on any
Indebtedness having an outstanding principal amount of at least
$10,000,000; or any other event or condition shall occur which results
in a default of any such Indebtedness or enables the holder of any such
Indebtedness or any Person acting on such holder's behalf to accelerate
the maturity thereof;
(g) The liquidation or dissolution of any Credit Party, or the
suspension of the business of any Credit Party, or the filing by any
Credit Party of a voluntary petition or an answer seeking
reorganization, arrangement, readjustment of its debts or for any other
relief under the United States Bankruptcy Code, as amended, or under
any other insolvency act or law, state or federal, now or hereafter
existing, or any other action of any Credit Party indicating its
consent to, approval of or acquiescence in, any such petition or
proceeding; the application by any Credit Party for, or the appointment
by consent or acquiescence of any Credit Party of a receiver, a trustee
or a custodian of any Credit Party for all or a substantial part of its
property; the making by Lessee of any assignment for the benefit of
creditors; the admission by any Credit Party in writing of its
inability to pay its debts as they mature or is generally not paying
its debts and other financial obligations as they become due and
payable; or any Credit Party taking any corporate action to authorize
any of the foregoing;
(h) The filing of an involuntary petition against any Credit
Party in bankruptcy or seeking reorganization, arrangement,
readjustment of its debts or for any other relief under the United
States Bankruptcy Code, as amended, or under any other insolvency act
or law, state or federal, now or hereafter existing; or the involuntary
appointment of a receiver, a trustee or a custodian of any Credit Party
for all or a substantial part of its property; or the issuance of a
warrant of attachment, execution or similar process against any
substantial part of the property of any Credit Party, and the
continuance of any of such events for ninety (90) days undismissed or
undischarged;
(i) The adjudication of any Credit Party as bankrupt or
insolvent;
(j) The entering of any order in any proceedings against any
Credit Party or any Subsidiary of any Credit Party decreeing the
dissolution, divestiture or split-up of any Credit Party or any
Subsidiary of any Credit Party, and such order remains in effect for
more than sixty (60) days;
(k) Any report, certificate, financial statement or other
instrument delivered to Lessor by or on behalf of any Credit Party
pursuant to the terms of this Lease or any other Operative Agreement is
false or misleading in any material respect when made or delivered;
(l) The Lessee or any other Credit Party shall
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(i) default in the due performance or observance of
any term, covenant or agreement contained in Sections 8.3A(b),
8.3A(h), 8.3A(i) or 8.3B(a) through 8.3B(o) of the
Participation Agreement, inclusive;
(ii) default in the due performance or observance of
any term, covenant or agreement contained in Sections
8.3A(a)(i), (ii), (iii) or (iv) of the Participation Agreement
and such default shall continue unremedied for a period of at
least five (5) days after the earlier of an officer of such
Credit Party becoming aware of such default or notice thereof
by the Agent; or
(iii) default in the due performance or observance by
it of any term, covenant or agreement (other than those
referred to in subsections (a), (b), (c), (l)(i) or (l)(ii) of
this Section 17.1) contained in this Lease or any other
Operative Agreement and such default shall continue
unremediated for a period of at least thirty (30) days after
the earlier of an officer of such Credit Party becoming aware
of such default or notice thereof by the Agent; provided,
however, that if such default is of a nature that is not
capable of being cured within such thirty (30) day period, and
the Lessee or any other such Credit Party promptly commences
appropriate steps to cure such default within such thirty (30)
day period and continues to pursue such cure with diligence
and good faith thereafter, unless the Agent shall determine
that such delay could reasonably be expected to have a
Material Adverse Effect, such thirty (30) day period shall be
extended for an additional sixty (60) days;
(m) A final Judgment or judgments for the payment of money
shall be rendered by a court or courts against any Credit Party or any
Subsidiary of any Credit Party or any of their assets in excess of
$10,000,000 in the aggregate, and (i) the same shall not be discharged
(or provision shall not be made for such discharge), or a stay of
execution thereof shall not be procured, within thirty (30) days from
the date of entry thereof, or (ii) any Credit Party or any such
Subsidiary shall not, within said period of thirty (30) days, or such
longer period during which execution of the same shall have been
stayed, appeal therefrom and cause the execution thereof to be stayed
during such appeal, or (iii) such judgment or judgments shall not be
discharged (or provisions shall not be made for such discharge) within
thirty (30) days after a decision has been reached with respect to such
appeal and the related stay has been lifted;
(n) Any Credit Party or any member of the Controlled Group
shall fail to pay when due an amount or amounts aggregating in excess
of $5,000,000 which it shall have become liable to pay to the PBGC or
to a Pension Plan under Title IV of ERISA; or notice of intent to
terminate a Pension Plan or Pension Plans having aggregate Unfunded
Liabilities in excess of $5,000,000 shall be filed under Title IV of
ERISA by any Credit Party or any member of the Controlled Group, any
plan administrator or any combination of the foregoing; or the PBGC
shall institute proceedings under Title IV of ERISA to terminate or to
cause a trustee to be appointed to administer any such Pension Plan or
Pension Plans or a proceeding shall be instituted by a fiduciary of any
such Pension Plan or Pension Plans against any Credit Party or any
member of the Controlled Group to
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enforce Section 515 or 4219(c)(5) of ERISA; or a condition shall exist
by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any such Pension Plan or Pension Plans must be
terminated;
(o) Any Change of Control shall occur;
(p) Any Operative Agreement shall cease to be in full force
and effect; or
(q) Except as to any Credit Party which is released in
connection with the Operative Agreements, the guaranty given by any
Guarantor under the Participation Agreement or any material provision
thereof shall cease to be in full force and effect, or any Guarantor or
any Person acting by or on behalf of such Guarantor shall deny or
disaffirm such Guarantor's obligations under such guaranty, or any
Guarantor shall default in the due performance or observance of any
term, covenant or agreement on its part to be performed or observed
pursuant to any guaranty;
then, in any such event, Lessor may, in addition to the other rights and
remedies provided for in this Article XVII and in Section 18.1, terminate this
Lease by giving Lessee five (5) days notice of such termination (provided,
notwithstanding the foregoing, this Lease shall be deemed to be automatically
terminated without the giving of notice upon the occurrence of a Lease Event of
Default under Sections 17.1 (g), (h) or (i), and this Lease shall terminate,
and all rights of Lessee under this Lease shall cease. Lessee shall, to the
fullest extent permitted by law, pay as Supplemental Rent all reasonable costs
and expenses incurred by or on behalf of Lessor or any other Financing Party,
including without limitation reasonable fees and expenses of counsel, as a
result of any Lease Event of Default hereunder.
A POWER OF SALE HAS BEEN GRANTED IN THIS LEASE. A POWER OF SALE MAY
ALLOW LESSOR TO TAKE THE PROPERTIES AND SELL THE PROPERTIES WITHOUT GOING TO
COURT IN A FORECLOSURE ACTION UPON THE OCCURRENCE OF A LEASE EVENT OF DEFAULT.
17.2 SURRENDER OF POSSESSION.
If a Lease Event of Default shall have occurred and be continuing,
and whether or not this Lease shall have been terminated pursuant to Section
17.1, Lessee shall, upon thirty (30) days written notice, surrender to Lessor
possession of the Properties. Lessor may enter upon and repossess the Properties
by such means as are available at law or in equity, and may remove Lessee and
all other Persons and any and all personal property and Lessee's equipment and
personalty and severable Modifications from the Properties. Lessor shall have no
liability by reason of any such entry, repossession or removal performed in
accordance with applicable law. Upon the written demand of Lessor, Lessee shall
return the Properties promptly to Lessor, in the manner and condition required
by, and otherwise in accordance with the provisions of, Section 22.1(c) hereof.
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17.3 RELETTING.
If a Lease Event of Default shall have occurred and be continuing,
and whether or not this Lease shall have been terminated pursuant to Section
17.1, Lessor may, but shall be under no obligation to, relet any or all of the
Properties, for the account of Lessee or otherwise, for such term or terms
(which may be greater or less than the period which would otherwise have
constituted the balance of the Term) and on such conditions (which may include
concessions or free rent) and for such purposes as Lessor may determine, and
Lessor may collect, receive and retain the rents resulting from such reletting.
Lessor shall not be liable to Lessee for any failure to relet any Property or
for any failure to collect any rent due upon such reletting.
17.4 DAMAGES.
Neither (a) the termination of this Lease as to all or any of the
Properties pursuant to Section 17.1; (b) the repossession of all or any of the
Properties; nor (c) the failure of Lessor to relet all or any of the Properties,
the reletting of all or any portion thereof, nor the failure of Lessor to
collect or receive any rentals due upon any such reletting, shall relieve Lessee
of its liabilities and obligations hereunder, all of which shall survive any
such termination, repossession or reletting. If any Lease Event of Default shall
have occurred and be continuing and notwithstanding any termination of this
Lease pursuant to Section 17.1, Lessee shall forthwith pay to Lessor all Rent
and other sums due and payable hereunder to and including without limitation the
date of such termination. Thereafter, on the days on which the Basic Rent or
Supplemental Rent, as applicable, are payable under this Lease or would have
been payable under this Lease if the same had not been terminated pursuant to
Section 17.1 and until the end of the Term hereof or what would have been the
Term in the absence of such termination, Lessee shall pay Lessor, as current
liquidated damages (it being agreed that it would be impossible accurately to
determine actual damages) an amount equal to the Basic Rent and Supplemental
Rent that are payable under this Lease or would have been payable by Lessee
hereunder if this Lease had not been terminated pursuant to Section 17.1, less
the net proceeds, if any, which are actually received by Lessor with respect to
the period in question of any reletting of any Property or any portion thereof;
provided, that Lessee's obligation to make payments of Basic Rent and
Supplemental Rent under this Section 17.4 shall continue only so long as Lessor
shall not have received the amounts specified in Section 17.6. In calculating
the amount of such net proceeds from reletting, there shall be deducted all of
Lessor's, any Holder's, the Agent's and any Lender's reasonable expenses in
connection therewith, including without limitation repossession costs, brokerage
or sales commissions, fees and expenses for counsel and any necessary repair or
alteration costs and expenses incurred in preparation for such reletting. To the
extent Lessor receives any damages pursuant to this Section 17.4, such amounts
shall be regarded as amounts paid on account of Rent. Lessee specifically
acknowledges and agrees that its obligations under this Section 17.4 shall be
absolute and unconditional under any and all circumstances and shall be paid
and/or performed, as the case may be, without notice or demand and without any
abatement, reduction, diminution, setoff, defense, counterclaim or recoupment
whatsoever.
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17.5 POWER OF SALE.
Without limiting any other remedies set forth in this Lease,
Lessor and Lessee agree that Lessee has granted, pursuant to Section 7.1 (b)
hereof and each Lease Supplement, a Lien against the Properties WITH POWER OF
SALE, and that, upon the occurrence and during the continuance of any Lease
Event of Default, Lessor shall have the power and authority, to the extent
provided by law, after prior notice and lapse of such time as may be required by
law, to foreclose its interest (or cause such interest to be foreclosed) in all
or any part of the Properties.
17.6 FINAL LIQUIDATED DAMAGES.
Subject to the limitations of the Agency Agreement, if a Lease
Event of Default shall have occurred and be continuing, whether or not this
Lease shall have been terminated pursuant to Section 17.1 and whether or not
Lessor shall have collected any current liquidated damages pursuant to Section
17.4, Lessor shall have the right to recover, by demand to Lessee and at
Lessor's election, and Lessee shall pay to Lessor, as and for final liquidated
damages, but exclusive of the indemnities payable under Section 11 of the
Participation Agreement (which, if requested, shall be paid concurrently), and
in lieu of all current liquidated damages beyond the date of such demand (it
being agreed that it would be impossible accurately to determine actual damages)
the Termination Value. Upon payment of the amount specified pursuant to the
first sentence of this Section 17.6, Lessee shall be entitled to receive from
Lessor, either at Lessee's request or upon Lessor's election, in either case at
Lessee's cost, an assignment of Lessor's entire right, title and interest in and
to the Properties, Improvements, Fixtures, Modifications, Equipment and all
components thereof, in each case in recordable form and otherwise in conformity
with local custom and free and clear of the Lien of this Lease (including
without limitation the release of any memoranda of Lease and/or the Lease
Supplement recorded in connection therewith) and any Lessor Liens. The
Properties shall be conveyed to Lessee "AS-IS, WHERE-IS" and in their then
present physical condition. Concurrent with such conveyance, Lessor shall assign
(free and clear of all Lessor Liens but subject to any and all other Liens) to
Lessee all right, title and interest of Lessor in and to the Indemnity Agreement
regarding matters and events arising from and after the date of such assignment
(provided, Lessor shall retain its right, title and interest in and to the
Indemnity Agreement regarding matters and events arising during the period when
Lessor held title to any Property). If any statute or rule of law shall limit
the amount of such final liquidated damages to less than the amount agreed upon,
Lessor shall be entitled to the maximum amount allowable under such statute or
rule of law; provided, however, Lessee shall not be entitled to receive an
assignment of Lessor's interest in the Properties, the Improvements, Fixtures,
Modifications, Equipment or the components thereof unless Lessee shall have paid
in full the Termination Value. Lessee specifically acknowledges and agrees that
its obligations under this Section 17.6 shall be absolute and unconditional
under any and all circumstances and shall be paid and/or performed, as the case
may be, without notice or demand and without any abatement, reduction,
diminution, setoff, defense, counterclaim or recoupment whatsoever.
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17.7 ENVIRONMENTAL COSTS.
If a Lease Event of Default shall have occurred and be continuing,
and whether or not this Lease shall have been terminated pursuant to Section
17.1, Lessee shall pay directly to any third party (or at Lessor's election,
reimburse Lessor) for the cost of any environmental testing and/or remediation
work undertaken respecting any Property (subject to the provisions of Section
15.2(b)), as such testing or work is deemed appropriate in the reasonable
judgment of Lessor, and shall indemnify and hold harmless Lessor and each other
Indemnified Person therefrom. Lessee shall pay all amounts referenced in the
immediately preceding sentence within ten (10) days of any request by Lessor for
such payment. The provisions of this Section 17.7 shall not limit the
obligations of Lessee under any Operative Agreement regarding indemnification
obligations, environmental testing, remediation and/or work.
17.8 WAIVER of Certain Rights.
If this Lease shall be terminated pursuant to Section 17.1, Lessee
waives, to the fullest extent permitted by Law, (a) any notice of re-entry or
the institution of legal proceedings to obtain re-entry or possession; (b) any
right of redemption, re-entry or possession; (c) the benefit of any laws now or
hereafter in force exempting property from liability for rent or for debt; and
(d) any other rights which might otherwise limit or modify any of Lessor's
rights or remedies under this Article XVII.
17.9 ASSIGNMENT OF RIGHTS UNDER CONTRACTS.
If a Lease Event of Default shall have occurred and be continuing,
and whether or not this Lease shall have been terminated pursuant to Section
17.1, Lessee shall upon Lessor's demand immediately assign, transfer and set
over to Lessor all of Lessee's right, title and interest in and to each
agreement executed by Lessee in connection with the acquisition, installation,
testing, use, development, construction, operation, maintenance, repair,
refurbishment and restoration of the Properties (including without limitation
all right, title and interest of Lessee with respect to all warranty,
performance, service and indemnity provisions), as and to the extent that the
same relate to the acquisition, installation, testing, use, development,
construction, operation, maintenance, repair, refurbishment and restoration of
the Properties or any of them.
17.10 REMEDIES CUMULATIVE.
Lessor shall be entitled to enforce payment of all amounts and
performance of obligations evidenced hereby and to exercise all rights and
powers under this instrument or under any of the other Operative Agreements or
other agreement or any laws now or hereafter in force, notwithstanding some or
all of the obligations evidenced hereby may now or hereafter be otherwise
secured, whether by mortgage, security agreement, pledge, lien, assignment or
otherwise. Neither the acceptance of this instrument nor its enforcement, shall
prejudice or in any manner affect Lessor's right to realize upon or enforce any
other security now or hereafter held by the Lessor, it being agreed that Lessor
shall be entitled to enforce this instrument and any other security now or
hereafter held by Lessor in such order and manner as Lessor may
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determine in its absolute discretion. No remedy herein conferred upon or
reserved to Lessor is intended to be exclusive of any other remedy herein or by
law provided or permitted, but each shall be cumulative and shall be in addition
to every other remedy given hereunder or now or hereafter existing at law or in
equity or by statute. Every power or remedy given by any of the Operative
Agreements to Lessor or to which it may otherwise be entitled, may be exercised,
concurrently or independently, from time to time and as often as may be deemed
expedient by Lessor. In no event shall Lessor, in the exercise of the remedies
provided in this instrument, be deemed a "mortgagee in possession," and Lessor
shall not In any way be made liable for any act, either of commission or
omission, in connection with the exercise of such remedies.
ARTICLE XVIII
18.1 LESSOR'S RIGHT TO CURE LESSEE'S LEASE DEFAULTS.
Lessor, without waiving or releasing any obligation or Lease Event
of Default, may (but shall be under no obligation to) remedy any Lease Event of
Default for the account and at the sole cost and expense of Lessee, including
without limitation the failure by Lessee to maintain the insurance required by
Article XIV, and may, to the fullest extent permitted by law, and
notwithstanding any right of quiet enjoyment in favor of Lessee, enter upon any
Property, and take all such action thereon as may be necessary or appropriate
therefor. No such entry shall be deemed an eviction of any lessee. All
out-of-pocket costs and expenses so incurred (including without limitation fees
and expenses of counsel), together with interest thereon at the Overdue Rate
from the date on which such sums or expenses are paid by Lessor, shall be paid
by Lessee to Lessor on demand.
ARTICLE XIX
19.1 PROVISIONS RELATING TO LESSEE'S EXERCISE OF ITS PURCHASE OPTION.
Subject to Section 19.2, in connection with any termination of
this Lease with respect to any Property pursuant to the terms of Section 16.2,
or in connection with Lessee's exercise of its Purchase Option, upon the date on
which this Lease is to terminate with respect to any Property, and upon tender
by Lessee of the amounts set forth in Sections 16.2(b) or 20.2, as applicable,
Lessor shall execute and deliver to Lessee (or to Lessee's designee) at Lessee's
cost and expense an assignment (by deed or other appropriate instrument) of
Lessor's entire interest in such Property, in each case in recordable form and
otherwise in conformity with local custom and free and clear of any Lessor Liens
attributable to Lessor but without any other warranties (of title or otherwise)
from Lessor. Such Property shall be conveyed to Lessee "AS-IS, "WHERE-IS" and in
then present physical condition.
19.2 [INTENTIONALLY OMITTED]
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ARTICLE XX
20.1 PURCHASE OPTION OR SALE OPTION-GENERAL PROVISIONS.
Not less than one hundred twenty (120) days and no more than one
hundred eighty (180) days prior to the Expiration Date or (respecting the
Purchase Option only) any Payment Date, Lessee may give Lessor irrevocable
written notice (the "Election Notice") that Lessee is electing to exercise
either (a) the option to purchase all, but not less than all, the Properties on
the Expiration Date or on the Payment Date specified in the Election Notice or
in accordance with the Parcel Sale Requirements, the option to purchase at least
one year prior to the Expiration Date one or more, but less than all, the
Properties (or a portion of any Property) on the Payment Date specified in the
Election Notice for purchase (the "Purchase Option") or (b) with respect to an
Election Notice given in connection with the Expiration Date only, the option to
remarket all, but not less than all, the Properties to a Person other than
Lessee or any Affiliate of Lessee and cause a sale of such Properties to occur
on the Expiration Date pursuant to the terms of Section 22.1 (the "Sale
Option"). Regarding the purchase of one or more, but less than all, the
Properties (or a portion of any Property), at Lessee's option and without the
consent of any Financing Party, Lessee may provide irrevocable written notice to
Lessor not less than one hundred twenty (120) days and no more than one hundred
eighty days prior to any Payment Date (in all cases at least one year prior to
the Expiration Date) that Lessee desires to purchase one or more, but less than
all, the Properties (or a portion of any Property), if (i) such Property or
portion of any Property to be purchased by Lessee has a separate legal and tax
parcel, (ii) the conveyance of such Property or portion of such Property will
not impair the access, use, occupancy or fair market value of the Properties
remaining in the Trust, (iii) the Properties remaining in the Trust (A) shall
constitute one or more legal and tax parcels, (B) shall contain at least one
building, (C) shall be viable as a separate property in compliance with Legal
Requirements and (D) shall have a fair market value of 100% or more of the
Property Cost allocable to such remaining Properties and (iv) at the time of
sale to Lessee of such Property or portion of any Property, no Default or Event
of Default shall have occurred and be continuing (other than those that will be
cured by the payment of the Termination Value for such Property (or a portion of
any Property)) (the terms referenced in the foregoing subsections (i), (ii),
(iii) and (iv), may be referred to as the "Parcel Sale Requirements"). To the
extent the Parcel Sale Requirements are satisfied, Lessor shall sell such
Property or portion of such Property to Lessee. If Lessee does not give an
Election Notice indicating the Purchase Option or the Sale Option at least one
hundred twenty (120) days and not more than one hundred eighty (180) days
prior to the Expiration Date, then, unless such Expiration Date is the final
Expiration Date to which the Term may be extended, the term of this Lease shall
be extended in accordance with Section 2.2 hereof; if such Expiration Date is
the final Expiration Date, then Lessee shall be deemed to have elected the
Purchase Option. If Lessee shall either (i) elect (or be deemed to have elected)
to exercise the Purchase Option or (ii) elect the Sale Option and fail to cause
all, but not less than all, the Properties to be sold in accordance with the
terms of Section 22.1 on the Expiration Date, then in either case Lessee shall
pay to Lessor on the date on which such purchase or sale is scheduled to occur
an amount equal to the Termination Value for all, but not less than all, the
Properties (which the parties do not intend to be a "bargain" purchase price)
and, upon receipt of such amounts and satisfaction of such obligations, Lessor
shall transfer to Lessee all of Lessor's
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right, title and interest in and to all, but not less than all, the Properties
in accordance with Section 20.2.
20.2 LESSEE PURCHASE OPTION.
Provided, no Default or Event of Default shall have occurred and
be continuing (other than those that will be cured by the payment of the
Termination Value for all the Properties) and provided, that the Election Notice
has been appropriately given specifying the Purchase Option, Lessee shall
purchase all the Properties (or if applicable, and upon satisfaction of all
Parcel Sale Requirements, one or more, but less than all, the Properties or a
portion of any Property pursuant to a notice provided in accordance with Section
20.1) on the Expiration Date or Payment Date at a price equal to the Termination
Value for such Properties (which the parties do not intend to be a "bargain"
purchase price).
Subject to Section 19.2, in connection with any termination of
this Lease with respect to any Property pursuant to the terms of Section 16.2,
or in connection with Lessee's exercise of its Purchase Option, upon the date on
which this Lease is to terminate with respect to a Property or all of the
Properties, and upon tender by Lessee of the amounts set forth in Section
16.2(b) or this Section 20.2, as applicable, Lessor shall execute, acknowledge
(where required) and deliver to Lessee, at Lessee's cost and expense, each of
the following: (a) a special or limited warranty Deed conveying each Property to
Lessee free and clear of the Lien of this Lease, the Lien of the Credit
Documents and any Lessor Liens; (b) a ▇▇▇▇ of Sale conveying each Property (to
the extent it is personal property) to Lessee free and clear of the Lien of this
Lease, the Lien of the Credit Documents and any Lessor Liens; (c) any real
estate tax affidavit or other document required by law to be executed and filed
in order to record the applicable Deed; and (d) FIRPTA affidavits. All of the
foregoing documentation must be in form and substance reasonably satisfactory to
Lessor. The applicable Property shall be conveyed to Lessee "AS-IS, WHERE-IS"
and in then present physical condition.
If any Property is the subject of remediation efforts respecting
Hazardous Substances at the Expiration Date (other than with respect to
Pre-Existing Environmental Conditions then being addressed by Raytheon or
▇▇▇▇▇▇▇▇▇, pursuant to the Indemnity Agreement or the Purchase Agreement) which
could materially and adversely impact the Fair Market Sales Value of such
Property (with materiality determined in each case in Lessor's reasonable
discretion), then Lessee shall be obligated to purchase each such Property
pursuant to Section 20.2.
On the Expiration Date and/or any Payment Date on which Lessee has
elected to exercise its Purchase Option, Lessee shall pay (or cause to be paid)
to Lessor, the Agent and all other parties, as appropriate, the sum of all costs
and expenses incurred by any such party in connection with the election by
Lessee to exercise its Purchase Option and all Rent and all other amounts then
due and payable or accrued under this Lease and/or any other Operative
Agreement.
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20.3 THIRD PARTY SALE OPTION.
(a) Provided, that (i) no Default or Event of Default shall
have occurred and be continuing and (ii) the Election Notice has been
appropriately given specifying the Sale Option. Lessee shall undertake
to cause a sale of the Properties on the Expiration Date (all as
specified in the Election Notice) in accordance with the provisions of
Section 22.1 hereof.
(b) In the event Lessee exercises the Sale Option then, as
soon as practicable and in all events not less than sixty (60) days
prior to the Expiration Date, Lessee shall cause to be delivered to
Lessor environmental site assessments for each of the Properties
recently prepared (no more than thirty (30) days old prior to the Sale
Date) by an independent recognized professional reasonably acceptable
to Lessor and in form, scope and content reasonably satisfactory to
Lessor. Lessor (at the direction of the Agent) shall elect whether the
costs incurred respecting the above-referenced environmental site
assessments shall be paid by either (i) sales proceeds from the
Properties, (ii) Lessor (but only the extent amounts are available
therefor with respect to the Available Commitments and the Available
Holder Commitments or each Lender and each Holder approves the
necessary increases in the Available Commitments and the Available
Holder Commitments to fund such costs) or (iii) Lessee; provided,
amounts funded by the Lenders and the Holders with respect to the
foregoing shall be added to the Property Cost of each applicable
Property; provided, further, amounts funded by Lessee with respect to
the foregoing shall be a part of (and limited by) the Maximum Residual
Guarantee Amount. In the event that Lessor shall not have received such
environmental site assessments by the date sixty (60) days prior to the
Expiration Date or in the event that such environmental assessment
shall reveal the existence of any material violation of Environmental
Laws, other material Environmental Violation or potential material
Environmental Violation (with materiality determined in each case by
Lessor in its reasonable discretion) other than the Pre-Existing
Environmental Conditions, then Lessee on the Expiration Date shall pay
to Lessor an amount equal to the Termination Value for all the
Properties and any and all other amounts due and owing hereunder. Upon
receipt of such payment and all other amounts due under the Operative
Agreements, Lessor shall transfer to Lessee all of Lessor's right,
title and interest in and to all the Properties in accordance with
Section 19.1.
ARTICLE XXI
21.1 [INTENTIONALLY OMITTED].
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ARTICLE XXII
22.1 SALE PROCEDURE.
(a) During the Marketing Period, Lessee, on behalf of Lessor,
shall obtain bids for the cash purchase of all the Properties in
connection with a sale to one (1) or more third party purchasers to be
consummated on the Expiration date or such earlier date as is
acceptable to the Agent and the Lessee (the "Sale Date") for the
highest price available, shall notify Lessor promptly of the name and
address of each prospective purchaser and the cash price which each
prospective purchaser shall have offered to pay for each such Property
and shall provide Lessor with such additional information about the
bids and the bid solicitation procedure as Lessor may reasonably
request from time to time. On the Sale Date, all Properties then
subject to this Lease shall be sold for one aggregate cash price amount
for all such Properties, without differentiation of such amount on a
Property-by-Property basis. All such prospective purchasers must be
Persons other than Lessee or any Affiliate of Lessee. On the Sale Date,
Lessee shall pay (or cause to be paid) to Lessor and all other parties,
as appropriate, all Rent and all other amounts then due and payable or
accrued under this Lease and/or any other Operative Agreement and
Lessor (at the direction of the Agent) shall elect whether the costs
and expenses incurred by Lessor and/or the Agent respecting the sale of
one or more Properties shall be paid by either (i) sales proceeds from
the Properties, (ii) Lessor (but only the extent amounts are available
therefor with respect to the Available Commitments and the Available
Holder Commitments or each Lender and each Holder approves the
necessary increases in the Available Commitments and the Available
Holder Commitments to fund such costs and expenses) or (iii) Lessee;
provided, amounts funded by the Lenders and the Holders with respect to
such costs and expenses shall be added to the Property Cost of each
applicable Property; provided, further, amounts funded by Lessee with
respect to such costs and expenses shall be a part of (and limited by)
the Maximum Residual Guarantee Amount.
Lessor may reject any and all bids and may solicit and obtain
bids by giving Lessee written notice to that effect; provided, however,
that notwithstanding the foregoing, Lessor may not reject any bid
submitted by Lessee if such bid, in the aggregate, is greater than or
equal to the sum of the Limited Recourse Amount for all the Properties,
and represents a bona fide offer from one (1) or more third party
purchasers. If the highest price which a prospective purchaser or the
prospective purchasers shall have offered to pay for all the Properties
on the Sale Date is less than the sum of the Limited Recourse Amount
for all the Properties or if such bids do not represent bona fide
offers from one (1) or more third parties or if there are no bids,
Lessor may elect to retain one or more of the Properties by giving
Lessee at least five (5) Business Days prior written notice of Lessor's
election to retain the same, and promptly upon receipt of such notice,
Lessee shall surrender, or cause to be surrendered, each of the
Properties specified in such notice in accordance with the terms and
conditions of Section 10.1. If Lessor does not elect to retain all the
Properties, then Lessee shall cause the sale of all of the Properties
to be completed on the Sale Date in accordance with this Section 22.1
and the
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maximum liability of the Lessee with respect thereto shall be as
provided pursuant to Section 22.1(b). Upon acceptance of any bid.
Lessor agrees, at Lessee's request and expense, to execute a contract
of sale with respect to such sale, so long as the same Is consistent
with the terms of this Article 22 and provides by its terms that it is
nonrecourse to Lessor.
Unless Lessor shall have elected to retain one or more of the
Properties, pursuant to the provisions of the preceding paragraph,
Lessee shall arrange for Lessor to sell all the Properties free and
clear of the Lien of this Lease and any Lessor Liens, without recourse
or warranty (of title or otherwise), for cash on the Sale Date to the
purchaser or purchasers offering the highest cash sales price, as
identified by Lessee or Lessor, as the case may be. To effect such
transfer and assignment, Lessor shall execute, acknowledge (where
required) and deliver to the appropriate purchaser each of the
following: (a) special or limited warranty Deeds conveying each such
Property (to the extent it is real property titled to Lessor) to the
appropriate purchaser free and clear of the Lien of this Lease, the
Lien of the Credit Documents and any Lessor Liens; (b) a ▇▇▇▇ of Sale
conveying each such Property (to the extent it is personal property)
titled to Lessor to the appropriate purchaser free and clear of the
Lien of this Lease, the Lien of the Credit Documents and any Lessor
Liens; (c) any real estate tax affidavit or other document required by
law to be executed and filed in order to record each Deed; and (d)
FIRPTA affidavits, as appropriate. All of the foregoing documentation
must be in form and substance reasonably satisfactory to Lessor. Lessee
shall surrender the Properties so sold or subject to such documents to
each purchaser in the condition specified in Section 10.1, or in such
other condition as may be agreed between Lessee and such purchaser.
Neither Lessor nor Lessee shall take or fail to take any action which
would have the effect of unreasonably discouraging bona fide third
party bids for any Property. If each of the Properties is not either
(i) sold on the Sale Date in accordance with the terms of this Section
22.1, or (ii) retained by Lessor pursuant to an affirmative election
made by Lessor pursuant to the second sentence of the second paragraph
of this Section 22.1 (a), then (x) Lessee shall be obligated to pay
Lessor on the Sale Date an amount equal to the aggregate Termination
Value for all the Properties less any sales proceeds received by the
Lessor, and (y) Lessor shall transfer each applicable Property to
Lessee in accordance with Section 20.2.
(b) If the Properties are sold on a Sale Date to one (1) or
more third party purchasers in accordance with the terms of Section
22.1(a) and the aggregate purchase price paid for all the Properties is
less than the sum of the aggregate Property Cost for all the Properties
(hereinafter such difference shall be referred to as the "Deficiency
Balance"), then Lessee hereby unconditionally promises to pay to Lessor
on the Sale Date all Rent and all other amounts then due and owing
pursuant to the Operative Agreements and the lesser of (i) the
Deficiency Balance, or (ii) the Maximum Residual Guarantee Amount for
all the Properties. On a Sale Date if (x) Lessor receives the aggregate
Termination Value for all the Properties from one (1) or more third
party purchasers, (y) Lessor and such other parties receive all other
amounts specified in the last sentence of the first paragraph of
Section 22.1(a) and (z) the aggregate purchase price paid for all the
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Properties on such date plus the amount paid by Lessee to Lessor
pursuant to the terms of this Section 22.(b) exceeds the sum of the
aggregate Property Cost for all the Properties, then Lessor shall
promptly pay Lessee such excess. The obligation to pay any such excess
to Lessee shall survive the termination of this Lease. If one or more
of the Properties are retained by Lessor pursuant to an affirmative
election made by Lessor pursuant to the provisions of Section 22.1(a),
then Lessee hereby unconditionally promises to pay to Lessor on the
Sale Date all Rent and all other amounts then due and owing pursuant to
the Operative Agreements and an amount equal to the Maximum Residual
Guarantee Amount for the Properties so retained. Any payment of the
foregoing amounts described in this Section 22.1(b) shall be made
together with a payment of all other amounts referenced in the last
sentence of the first paragraph of Section 22.1 (a).
(c) In the event that all the Properties are either sold to
one (1) or more third party purchasers on the Sale Date or retained by
Lessor in connection with an affirmative election made by Lessor
pursuant to the provisions of Section 22.1(a), then in either case on
the applicable Sale Date Lessee shall provide Lessor or such third
party purchaser (unless otherwise agreed by such third party purchaser)
with (i) all non-proprietary permits, certificates of occupancy,
governmental licenses and authorizations necessary to use, operate,
repair, access and maintain each such Property for the purpose it is
being used by Lessee, and (ii) such non-proprietary manuals, permits,
easements, licenses, intellectual property, know-how, rights-of-way and
other rights and privileges in the nature of an easement as are
reasonably necessary or desirable in connection with the use,
operation, repair, access to or maintenance of each such Property for
its intended purpose or otherwise as Lessor or such third party
purchaser(s) shall reasonably request (and a royalty-free license or
similar agreement to effectuate the foregoing on terms reasonably
agreeable to Lessor or such third party purchasers), as applicable).
All such assignments, licenses, easements, agreements and other
deliveries required by clauses (i) and (ii) of this paragraph (c) shall
be in form reasonably satisfactory to Lessor or such third party
purchaser(s), as applicable, and shall be fully assignable (including
without limitation both primary assignments and assignments given in
the nature of security) without payment of any fee, cost or other
charge.
22.2 APPLICATION OF PROCEEDS OF SALE.
In the event Lessee receives any proceeds of sale of any
Property, such proceeds shall be deemed to have been received in trust
on behalf of Lessor and Lessee shall promptly remit such proceeds to
Lessor. Lessor shall apply the proceeds of sale of any Property in the
following order of priority:
(a) FIRST, to pay or to reimburse Lessor (and/or the Agent, as
the case may be) for the payment of all reasonable costs and expenses
incurred by Lessor (and/or the Agent, as the case may be) in connection
with the sale (to the extent Lessee has not satisfied its obligation to
pay such costs and expenses);
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(b) SECOND, so long as the Credit Agreement is in effect and
any Loans or Holder Advances or any amount is owing to the Financing
Parties under any Operative Agreement, to the Agent to be applied
pursuant to intercreditor provisions among Lessor, the Lenders and the
Holders contained in the Operative Agreements; and
(c) THIRD, to Lessee.
22.3 INDEMNITY FOR EXCESSIVE WEAR.
If the proceeds of the sale described in Section 22.1 with respect to
the Properties shall be less than the Limited Recourse Amount with respect to
the Properties, and at the time of such sale it shall have been reasonably
determined (pursuant to the Appraisal Procedure) that the Fair Market Sales
Value of the Properties shall have been impaired by greater than normal and
expected wear and tear during the term of the Lease, Lessee shall pay to Lessor
within ten (10) days after receipt of Lessor's written statement (i) the amount
of such excess wear and tear determined by the Appraisal Procedure or (ii) the
amount of the Sale Proceeds Shortfall, whichever amount is less.
22.4 APPRAISAL PROCEDURE.
For determining the Fair Market Sales Value of the Properties or any
other amount which may, pursuant to any provision of any Operative Agreement, be
determined by an appraisal procedure, Lessor and Lessee shall use the following
procedure (the "Appraisal Procedure"). Lessor and Lessee shall endeavor to reach
a mutual agreement as to such amount for a period of ten (10) days from
commencement of the Appraisal Procedure under the applicable section of the
Lease, and if they cannot agree within ten (10) days, then two (2) qualified
appraisers, one (1) chosen by Lessee and one (1) chosen by Lessor, shall
mutually agree thereupon, but if either party shall fail to choose an appraiser
within twenty (20) days after notice from the other party of the selection of
its appraiser, then the appraisal by such appointed appraiser shall be binding
on Lessee and Lessor. If the two (2) appraisers cannot agree within twenty (20)
days after both shall have been appointed, then a third appraiser shall be
selected by the two (2) appraisers or, failing agreement as to such third
appraiser within thirty (30) days after both shall have been appointed, by the
American Arbitration Association. The decisions of the three (3) appraisers
shall be given within twenty (20) days of the appointment of the third appraiser
and the decision of the appraiser most different from the average of the other
two (2) shall be discarded and such average shall be binding on Lessor and
Lessee; provided, that if the highest appraisal and the lowest appraisal are
equidistant from the third appraisal, the third appraisal shall be binding on
Lessor and Lessee. The fees and expenses of the appraiser appointed by Lessee
shall be paid by Lessee; the fees and expenses of the appraiser appointed by
Lessor shall be paid by Lessor (such fees and expenses not being indemnified
pursuant to Section 11 of the Participation Agreement); and the fees and
expenses of the third appraiser shall be divided equally between Lessee and
Lessor.
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22.5 CERTAIN OBLIGATIONS CONTINUE.
During the Marketing Period, the obligation of Lessee to pay Rent with
respect to the Properties (including without limitation the installment of Basic
Rent due on the Expiration Date) shall continue undiminished until payment in
full to Lessor of the sale proceeds, if any, the Maximum Residual Guarantee
Amount, the amount due under Section 22.3, if any, and all other amounts due to
Lessor or any other Person with respect to all Properties or any Operative
Agreement. Lessor shall have the right, but shall be under no duty, to solicit
bids, to inquire into the efforts of Lessee to obtain bids or otherwise to take
action in connection with any such sale, other than as expressly provided in
this Article XXII.
ARTICLE XXIII
23.1 HOLDING OVER.
If Lessee shall for any reason remain in possession of a Property after
the expiration or earlier termination of this Lease as to such Property (unless
such Property is conveyed to Lessee), such possession shall be as a tenancy at
sufferance during which time Lessee shall continue to pay Supplemental Rent that
would be payable by Lessee hereunder were the Lease then in full force and
effect with respect to such Property and Lessee shall continue to pay Basic Rent
at the lesser of the highest lawful rate and one hundred ten percent (110%) of
the last payment of Basic Rent due with respect to such Property prior to such
expiration or earlier termination of this Lease. Such Basic Rent shall be
payable from time to time upon demand by Lessor and such additional amount of
Basic Rent shall be applied by Lessor ratably to the Lenders and the Holders
based on their relative amounts of the then outstanding aggregate Property Cost
for all Properties. During any period of tenancy at sufferance, Lessee shall,
subject to the second preceding sentence, be obligated to perform and observe
all of the terms, covenants and conditions of this Lease, but shall have no
rights hereunder other than the right, to the extent given by law to tenants at
sufferance, to continue their occupancy and use of such Property. Nothing
contained in this Article XXIII shall constitute the consent, express or
implied, of Lessor to the holding over of Lessee after the expiration or earlier
termination of this Lease as to any Property (unless such Property is conveyed
to Lessee) and nothing contained herein shall be read or construed as preventing
Lessor from maintaining a suit for possession of such Property or exercising any
other remedy available to Lessor at law or in equity.
ARTICLE XXIV
24.1 RISK OF LOSS.
Subject to the terms and limitations of the Agency Agreement, during
the Term, unless Lessee shall not be in actual possession of any Property in
question solely by reason of Lessor's exercise of its remedies of dispossession
under Article XVII, the risk of loss or decrease in the enjoyment and beneficial
use of such Property as a result of the damage or destruction
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thereof by fire, the elements, casualties, thefts, riots, wars or otherwise is
assumed by Lessee, and Lessor shall in no event be answerable or accountable
therefor, except for Lessor's obligation to advance in accordance with the terms
of this Lease insurance proceeds received by Lessor pursuant to the coverages
referenced in Article XIV.
ARTICLE XXV
25.1 ASSIGNMENT.
(a) Lessee may not assign this Lease or any of its rights or
obligations hereunder or with respect to any Property in whole or in
part to any Person (other than to a wholly-owned Subsidiary of Lessee
or the Parent) without the prior written consent of the Agent, the
Lenders, the Holders and Lessor.
(b) No assignment by Lessee (referenced in this Section 25.1
or otherwise) or other relinquishment of possession to any Property
shall in any way discharge or diminish any of the obligations of Lessee
to Lessor hereunder and Lessee shall remain directly and primarily
liable under the Operative Agreements as to any rights or obligations
assigned by Lessee or regarding any Property in which rights or
obligations have been assigned or otherwise transferred.
25.2 SUBLEASES.
(a) Promptly, but in any event within five (5) Business Days,
following the execution and delivery of any sublease permitted by this
Article XXV, Lessee shall notify Lessor of the execution of such
sublease and shall collaterally assign such sublease to the Lessor as
security for Lessee's obligations hereunder and under any other
Operative Agreement. Any such collateral assignment shall be in form
and substance reasonably acceptable to the Lessor and the Agent. As of
the date of each Lease Supplement, Lessee shall lease the respective
Properties described in such Lease Supplement from Lessor, and any
existing tenant respecting such Property shall automatically be deemed
to be a subtenant of Lessee and not a tenant of Lessor.
(b) Without the prior written consent of the Agent, any
Lender, any Holder or Lessor and subject to the other provisions of
this Section 25.2, Lessee may sublet (i) any Property or portion
thereof to any wholly-owned Subsidiary of Lessee and (ii) up to 50% of
the Properties (based on the square footage of the Improvements
constituting a Permitted Facility) then subject to this Lease to any
Person which is not an Affiliate of Lessee. Except as referenced in the
immediately preceding sentence, no other subleases shall be permitted
unless consented to in writing by Lessor which consent shall not be
unreasonably withheld or delayed. All subleasing shall be done on
market terms and shall in no way diminish the fair market value or
useful life of any applicable Property.
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(c) No sublease (referenced in this Section 25.2 or otherwise)
or other relinquishment of possession to any Property shall in any way
discharge or diminish any of Lessee's obligations to Lessor hereunder
or diminish the fair market value of any Property. Lessee shall remain
directly and primarily liable under this Lease as to such Property, or
portion thereof, so sublet. During the Basic Term, the term of any such
sublease shall not extend beyond the Basic Term. During any Renewal
Term, the term of any such sublease shall not extend beyond such
Renewal Term. Each sublease shall be expressly subject and subordinate
to this Lease.
ARTICLE XXVI
26.1 NO WAIVER.
No failure by Lessor or Lessee to insist upon the strict performance of
any term hereof or to exercise any right, power or remedy upon a default
hereunder, and no acceptance of full or partial payment of Rent during the
continuance of any such default, shall constitute a waiver of any such default
or of any such term. To the fullest extent permitted by law, no waiver of any
default shall affect or alter this Lease, and this Lease shall continue in full
force and effect with respect to any other then existing or subsequent default.
ARTICLE XXVII
27.1 ACCEPTANCE OF SURRENDER.
No surrender to Lessor of this Lease or of all or any portion of any
Property or of any part of any thereof or of any interest therein shall be valid
or effective unless agreed to and accepted in writing by Lessor and no act by
Lessor or the Agent or any representative or agent of Lessor or the Agent, other
than a written acceptance, shall constitute an acceptance of any such surrender.
27.2 NO MERGER OF TITLE.
There shall be no merger of this Lease or of the leasehold estate
created hereby by reason of the fact that the same Person may acquire, own or
hold, directly or indirectly, in whole or in part, (a) this Lease or the
leasehold estate created hereby or any interest in this Lease or such leasehold
estate, (b) any right, title or interest in any Property, (c) any Notes, or (d)
a beneficial interest in Lessor.
ARTICLE XXVIII
28.1 [RESERVED]
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ARTICLE XXIX
29.1 NOTICES.
All notices required or permitted to be given under this Lease shall be
in writing and delivered as provided in the Participation Agreement.
ARTICLE XXX
30.1 MISCELLANEOUS.
Anything contained in this Lease to the contrary notwithstanding, all
claims against and liabilities of Lessee or Lessor arising from events
commencing prior to the expiration or earlier termination of this Lease shall
survive such expiration or earlier termination. If any provision of this Lease
shall be held to be unenforceable in any Jurisdiction, such unenforceability
shall not affect the enforceability of any other provision of this Lease and
such jurisdiction or of such provision or of any other provision hereof in any
other jurisdiction.
30.2 AMENDMENTS AND MODIFICATIONS.
Neither this Lease nor any Lease Supplement may be amended, waived,
discharged or terminated except in accordance with the provisions of Section
12.4 of the Participation Agreement.
30.3 SUCCESSORS AND ASSIGNS.
All the terms and provisions of this Lease shall inure to the benefit
of the parties hereto and their respective successors and permitted assigns.
30.4 HEADINGS AND TABLE OF CONTENTS.
The headings and table of contents in this Lease are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof
30.5 COUNTERPARTS.
This Lease may be executed in any number of counterparts, each of which
shall be an original, but all of which shall together constitute one (1) and the
same instrument.
30.6 GOVERNING LAW.
THIS LEASE SHALL BE GOVERNED BY AND CONSTRUED, INTERPRETED AND ENFORCED
IN ACCORDANCE WITH THE LAWS OF THE STATE
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OF NEW YORK, EXCEPT TO THE EXTENT THE LAWS OF THE STATE WHERE A PARTICULAR
PROPERTY IS LOCATED ARE REQUIRED TO APPLY.
30.7 CALCULATION OF RENT.
All calculation of Rent payable hereunder shall be computed based on
the actual number of days elapsed over a year of three hundred sixty (360) days
or, to the extent such Rent is based on the Prime Lending Rate, three hundred
sixty-five (365) (or three hundred sixty-six (366), as applicable) days.
30.8 MEMORANDA OF LEASE AND LEASE SUPPLEMENTS.
This Lease shall not be recorded; provided, Lessor and Lessee shall
promptly record (a) a memorandum of this Lease and the applicable Lease
Supplement (in substantially the form of Exhibit B attached hereto) or a short
form lease (in form and substance reasonably satisfactory to Lessor) regarding
each Property promptly after the acquisition thereof in the local filing office
with respect thereto and as required under applicable law to sufficiently
evidence this Lease and any such Lease Supplement in the applicable real estate
filing records. Lessor (at the direction of the Agent) shall elect whether the
costs and expenses incurred by Lessor and/or the Agent respecting the
recordation of the above-referenced items shall be paid by either (i) Lessor
(but only the extent amounts are available therefor with respect to the
Available Commitments and the Available Holder Commitments or each Lender and
each Holder approves the necessary increases in the Available Commitments and
the Available Holder Commitments to fund such costs and expenses) or (ii)
Lessee; provided, amounts funded by the Lenders and the Holders with respect to
such costs and expenses shall be added to the Property Cost of each applicable
Property; provided, further, amounts funded by Lessee with respect to such costs
and expenses shall be a part of (and limited by) the Maximum Residual Guarantee
Amount.
30.9 ALLOCATIONS BETWEEN THE LENDERS AND THE HOLDERS.
Notwithstanding any other term or provision of this Lease to the
contrary, the allocations of the proceeds of the Properties and any and all
other Rent and other amounts received hereunder shall be subject to the
inter-creditor provisions between the Lenders and the Holders contained in the
Operative Agreements (or as otherwise agreed among the Lenders and the Holders
from time to time).
30.10 LIMITATIONS ON RECOURSE.
Notwithstanding anything contained in this Lease to the contrary,
Lessee agrees to look solely to Lessor's estate and interest in the Properties,
the proceeds of any sale thereof, any insurance proceeds from insurance coverage
required pursuant to the Lease or any condemnation or similar proceeds received
by Lessor in connection with any Property (and in no circumstance to the Agent,
the Lenders, the Holders or otherwise to Lessor) for the collection of any
judgment requiring the payment of money by Lessor in the event of liability by
Lessor, and no other property or assets of Lessor or any shareholder, owner or
partner (direct or indirect) in or of
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Lessor, or any director, officer, employee, beneficiary, Affiliate of any of the
foregoing shall be subject to levy, execution or other enforcement procedure for
the satisfaction of the remedies of Lessee under or with respect to this Lease,
the relationship of Lessor and Lessee hereunder or Lessee's use of the
Properties or any other liability of Lessor to Lessee; provided, that Lessor
shall be liable in its individual capacity for (a) its own willful misconduct or
gross negligence and (b) breach of any of its representations and warranties or
covenants under the Operative Agreements. Nothing in this Section shall be
interpreted so as to limit the terms of Sections 6.1 or 6.2 or the provisions of
Section 12.9 of the Participation Agreement.
30.11 WAIVERS OF JURY TRIAL.
EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY, TO
THE FULLEST EXTENT ALLOWED BY APPLICABLE LAW, WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS LEASE AND FOR ANY
COUNTERCLAIM THEREIN.
30.12 EXERCISE OF LESSOR RIGHTS.
Lessee hereby acknowledges and agrees that the rights and powers of
Lessor under this Lease have been assigned to the Agent pursuant to the terms of
the Security Agreement and the other Operative Agreements. Lessor and Lessee
hereby acknowledge and agree that (a) the Agent shall, in its discretion, direct
and/or act on behalf of Lessor pursuant to the provisions of Sections 8.2(h) and
8.6 of the Participation Agreement, (b) all notices to be given to Lessor shall
be given to the Agent and (c) all notices to be given by Lessor may be given by
the Agent, at its election.
30.13 SUBMISSION TO JURISDICTION; VENUE.
THE PROVISIONS OF THE PARTICIPATION AGREEMENT RELATING TO SUBMISSION TO
JURISDICTION AND VENUE ARE HEREBY INCORPORATED BY REFERENCE HEREIN, MUTATIS
MUTANDIS.
30.14 USURY SAVINGS PROVISION.
IT IS THE INTENT OF THE PARTIES HERETO TO CONFORM TO AND CONTRACT IN
STRICT COMPLIANCE WITH APPLICABLE USURY LAW FROM TIME TO TIME IN EFFECT. TO THE
EXTENT ANY RENT OR PAYMENTS HEREUNDER ARE HEREINAFTER CHARACTERIZED BY ANY COURT
OF COMPETENT JURISDICTION AS THE REPAYMENT OF PRINCIPAL AND INTEREST THEREON,
THIS SECTION 30.14 SHALL APPLY. ANY SUCH RENT OR PAYMENTS SO CHARACTERIZED AS
INTEREST MAY BE REFERRED TO HEREIN AS "INTEREST." ALL AGREEMENTS AMONG THE
PARTIES HERETO ARE HEREBY LIMITED BY THE PROVISIONS OF THIS PARAGRAPH WHICH
SHALL OVERRIDE AND CONTROL ALL SUCH
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AGREEMENTS, WHETHER NOW EXISTING OR HEREAFTER ARISING AND WHETHER WRITTEN OR
ORAL. IN NO WAY, NOR IN ANY EVENT OR CONTINGENCY (INCLUDING WITHOUT LIMITATION
PREPAYMENT OR ACCELERATION OF THE MATURITY OF ANY OBLIGATION), SHALL ANY
INTEREST TAKEN, RESERVED, CONTRACTED FOR, CHARGED, OR RECEIVED UNDER THIS LEASE
OR OTHERWISE. EXCEED THE MAXIMUM NONUSURIOUS AMOUNT PERMISSIBLE UNDER APPLICABLE
LAW. IF, FROM ANY POSSIBLE CONSTRUCTION OF ANY OF THE OPERATIVE AGREEMENTS OR
ANY OTHER DOCUMENT OR AGREEMENT, INTEREST WOULD OTHERWISE BE PAYABLE IN EXCESS
OF THE MAXIMUM NONUSURIOUS AMOUNT, ANY SUCH CONSTRUCTION SHALL BE SUBJECT TO THE
PROVISIONS OF THIS PARAGRAPH AND SUCH AMOUNTS UNDER SUCH DOCUMENTS OR AGREEMENTS
SHALL BE AUTOMATICALLY REDUCED TO THE MAXIMUM NONUSURIOUS AMOUNT PERMITTED UNDER
APPLICABLE LAW, WITHOUT THE NECESSITY OF EXECUTION OF ANY AMENDMENT OR NEW
DOCUMENT OR AGREEMENT. IF LESSOR SHALL EVER RECEIVE ANYTHING OF VALUE WHICH IS
CHARACTERIZED AS INTEREST WITH RESPECT TO THE OBLIGATIONS OWED HEREUNDER OR
UNDER APPLICABLE LAW AND WHICH WOULD, APART FROM THIS PROVISION, BE IN EXCESS OF
THE MAXIMUM LAWFUL AMOUNT, AN AMOUNT EQUAL TO THE AMOUNT WHICH WOULD HAVE BEEN
EXCESSIVE INTEREST SHALL, WITHOUT PENALTY, BE APPLIED TO THE REDUCTION OF THE
COMPONENT OF PAYMENTS DEEMED TO BE PRINCIPAL AND NOT TO THE PAYMENT OF INTEREST,
OR REFUNDED TO LESSEE OR ANY OTHER PAYOR THEREOF, IF AND TO THE EXTENT SUCH
AMOUNT WHICH WOULD HAVE BEEN EXCESSIVE EXCEEDS THE COMPONENT OF PAYMENTS DEEMED
TO BE PRINCIPAL. THE RIGHT TO DEMAND PAYMENT OF ANY AMOUNTS EVIDENCED BY ANY OF
THE OPERATIVE AGREEMENTS DOES NOT INCLUDE THE RIGHT TO RECEIVE ANY INTEREST
WHICH HAS NOT OTHERWISE ACCRUED ON THE DATE OF SUCH DEMAND, AND LESSOR DOES NOT
INTEND TO CHARGE OR RECEIVE ANY UNEARNED INTEREST IN THE EVENT OF SUCH DEMAND.
ALL INTEREST PAID OR AGREED TO BE PAID TO LESSOR SHALL, TO THE EXTENT PERMITTED
BY APPLICABLE LAW, BE AMORTIZED, PRORATED, ALLOCATED, AND SPREAD THROUGHOUT THE
FULL STATED TERM (INCLUDING WITHOUT LIMITATION ANY RENEWAL OR EXTENSION) OF THIS
LEASE SO THAT THE AMOUNT OF INTEREST ON ACCOUNT OF SUCH PAYMENTS DOES NOT EXCEED
THE MAXIMUM NONUSURIOUS AMOUNT PERMITTED BY APPLICABLE LAW.
[signature page follows]
41
46
IN WITNESS WHEREOF, the parties have caused this Lease to be duly
executed and delivered as of the date first above written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not individually,
but solely as the Owner Trustee
under the VS Trust 1999-1, as
Lessor
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Title: Vice President
----------------------------------
VERITAS SOFTWARE CORPORATION, as Lessee
By:
------------------------------------
Name:
------------------------------------
Title:
----------------------------------
Receipt of this original
counterpart of the foregoing
Lease is hereby acknowledged
as the date hereof
NATIONSBANK, N.A.,
as the Agent
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
47
IN WITNESS WHEREOF, the parties have caused this Lease to be duly
executed and delivered as of the date first above written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not individually,
but solely as the Owner Trustee
under the VS Trust 1999-1, as
Lessor
By:
------------------------------------
Name:
------------------------------------
Title:
----------------------------------
VERITAS SOFTWARE CORPORATION, as Lessee
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Title: Senior Vice President
----------------------------------
Receipt of this original
counterpart of the foregoing
Lease is hereby acknowledged
as the date hereof
NATIONSBANK, N.A.,
as the Agent
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
48
EXHIBIT A TO THE LEASE
LEASE SUPPLEMENT NO. _
THIS LEASE SUPPLEMENT NO. _ (this "Lease Supplement") dated as of
_____________, 1999 between FIRST SECURITY BANK, NATIONAL ASSOCIATION, a
national banking association, not individually, but solely as the Owner Trustee
under the VS Trust 1999-1, as lessor (the "Lessor"), and VERITAS SOFTWARE
CORPORATION, a Delaware corporation, as lessee (the "Lessee").
WHEREAS, Lessor is the owner or will be the owner of the Property
described on Schedule 1 hereto (the "Leased Property") and wishes to lease the
same to Lessee;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
SECTION 1. DEFINITIONS; RULES OF Usage. For purposes of this Lease
Supplement, capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to them in Appendix A to the Participation Agreement,
dated as of April 23, 1999, among Lessee, the various parties thereto from time
to time, as the Guarantors, Lessor, not individually, except as expressly stated
therein, but solely as the Owner Trustee under the VS Trust 1999-1, the various
banks and other lending institutions which are parties thereto from time to
time, as the Holders, the various banks and other lending institutions which are
parties thereto from time to time, as the Lenders, and NationsBank, N.A., as the
Agent for the Lenders and respecting the Security Documents, as the Agent for
the Lenders and Holders, to the extent of their interests, as such may be
amended, modified, extended, supplemented, restated and/or replaced from time to
time.
SECTION 2. THE PROPERTIES. Attached hereto as Schedule 1 is the
description of the Leased Property, with an Equipment Schedule attached hereto
as Schedule 1-A, an Improvement Schedule attached hereto as Schedule 1-B and a
legal description of the Land attached hereto as Schedule 1-C. Effective upon
the execution and delivery of this Lease Supplement by Lessor and Lessee, the
Leased Property shall be subject to the terms and provisions of the Lease.
Without further action, any and all additional Equipment funded under the
Operative Agreements and any and all additional Improvements made to the Land
shall be deemed to be titled to the Lessor and subject to the terms and
conditions of the Lease and this Lease Supplement.
SECTION 3. USE OF PROPERTY. At all times during the Term with respect to
each Property, Lessee will comply with all obligations under and (to the extent
no Event of Default exists and provided, that such exercise will not impair the
value of such Property) shall be permitted to exercise all rights and remedies
under, all operation and easement agreements and related or similar agreements
applicable to such Property.
49
SECTION 4. RATIFICATION; INCORPORATION by REFERENCE. Except as
specifically modified hereby, the terms and provisions of the Lease and the
Operative Agreements are hereby ratified and confirmed and remain in full force
and effect. The Lease is hereby incorporated herein by reference as though
restated herein in its entirety.
SECTION 5. ORIGINAL LEASE SUPPLEMENT. The single executed original of
this Lease Supplement marked "THIS COUNTERPART IS THE ORIGINAL EXECUTED
COUNTERPART" on the signature page thereof and containing the receipt of the
Agent therefor on or following the signature page thereof shall be the original
executed counterpart of this Lease Supplement (the "Original Executed
Counterpart"). To the extent that this Lease Supplement constitutes chattel
paper, as such term is defined in the Uniform Commercial Code as in effect in
any applicable jurisdiction, no security interest in this Lease Supplement may
be created through the transfer or possession of any counterpart other than the
Original Executed Counterpart.
SECTION 6. GOVERNING LAW. THIS LEASE SUPPLEMENT SHALL BE GOVERNED BY AND
CONSTRUED, INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE LAW OF THE STATE OF
NEW YORK, EXCEPT TO THE EXTENT THE LAWS OF THE STATE WHERE A PARTICULAR PROPERTY
IS LOCATED ARE REQUIRED TO APPLY.
SECTION 7. COUNTERPART EXECUTION. This Lease Supplement may be executed
in any number of counterparts and by each of the parties hereto in separate
counterparts, all such counterparts together constituting but one (1) and the
same instrument.
SECTION 8. MAXIMUM RESIDUAL GUARANTEE AMOUNT. The Maximum Residual
Guarantee Amount shall mean an amount equal to [THE LAND COST] [THE PRODUCT OF
THE AGGREGATE PROPERTY COST FOR ALL OF THE LEASED PROPERTY TIMES ____ PERCENT
( _%)].
For purposes of the provisions of this Lease Supplement concerning this
Lease Supplement constituting a security agreement and fixture filing, the
addresses of the debtor (Lessee herein) and the secured party (Lessor herein),
from whom information may be obtained about this Lease Supplement, are as set
forth on the signature pages hereto.
[The remainder of this page has been intentionally left blank.]
2
50
IN, WITNESS WHEREOF, each of the parties hereto has caused this Lease
Supplement to be duly executed by an officer thereunto duly authorized as of the
date and year first above written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not Individually, but solely
as the Owner Trustee under the VS Trust
1999-1, as Lessor
By:_______________________________________
Name:_____________________________________
Title:____________________________________
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇. ▇▇▇▇▇
Vice President
VERITAS SOFTWARE CORPORATION,
as Lessee
By:_______________________________________
Name:_____________________________________
Title:____________________________________
Veritas Software Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇
Receipt of this original counterpart
of the foregoing Lease Supplement
is hereby acknowledged as the date
hereof
NATIONSBANK, N.A., as the Agent
By:_________________________________
Name:_______________________________
Title:______________________________
NationsBank, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: Ms. ▇▇▇▇▇▇ ▇▇▇▇▇
51
STATE OF ______________ )
) ss:
COUNTY OF _____________ )
The foregoing Lease Supplement was acknowledged before me, the undersigned
Notary Public, in the County of _______________ this ____ day of ________, 1999,
by ___________________, as _________________ of FIRST SECURITY BANK, NATIONAL
ASSOCIATION, a national banking association, not individually, but solely as
the Owner Trustee under the VS Trust 1999-1, on behalf of the Owner Trustee.
[Notarial Seal] ----------------------------------
Notary Public
My commission expires: ____________
STATE OF ______________ )
) ss:
COUNTY OF _____________ )
The foregoing Lease Supplement was acknowledged before me, the undersigned
Notary Public, in the County of _______________ this ____ day of ________, 1999,
by ___________________, as _________________ of VERITAS SOFTWARE CORPORATION, a
Delaware corporation, on behalf of the corporation.
[Notarial Seal] ----------------------------------
Notary Public
My commission expires: ____________
STATE OF ______________ )
) ss:
COUNTY OF _____________ )
The foregoing Lease Supplement was acknowledged before me, the undersigned
Notary Public, in the County of _______________ this ____ day of ________, 1999,
by ___________________, as _________________ of NATIONSBANK, N.A., a national
banking association, as the Agent.
[Notarial Seal] ----------------------------------
Notary Public
My commission expires: ____________
52
SCHEDULE I
TO LEASE SUPPLEMENT NO.__
(Description of the Leased Property)
53
SCHEDULE 1-A
TO LEASE SUPPLEMENT NO.__
(Equipment)
54
SCHEDULE 1-B
TO LEASE SUPPLEMENT NO. __
(Improvements)
55
SCHEDULE I-C
TO LEASE SUPPLEMENT NO. __
(Land)
56
EXHIBIT B TO THE LEASE
[MODIFY OR SUBSTITUTE SHORT FORM LEASE AS
NECESSARY FOR LOCAL LAW REQUIREMENTS]
Recording Requested By
CHICAGO TITLE COMPANY.
and When Recorded Return to:
▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
MEMORANDUM OF LEASE AGREEMENT
AND
LEASE SUPPLEMENT NO.
AND
DEED OF TRUST
dated as of April __, 1999
among
VERITAS SOFTWARE CORPORATION,
as the Lessee,
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually but solely as Owner Trustee under the
VS Trust 1999-1,
as the Lessor,
and
CHICAGO TITLE COMPANY,
as Trustee
Location of Premises:
County of Santa ▇▇▇▇▇
State of California
57
THIS MEMORANDUM OF LEASE AGREEMENT AND LEASE SUPPLEMENT NO. __ AND DEED
OF TRUST ("Memorandum"), dated as of April ____________, 1999, is by and among
FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national banking association, not
individually, but solely as the Owner Trustee under the VS Trust 1999-1, with an
office at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ (hereinafter
referred to as "Lessor"), VERITAS SOFTWARE CORPORATION, a Delaware corporation,
with an office at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(hereinafter referred to as "Lessee") and CHICAGO TITLE COMPANY, a __________
corporation, with an office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ (hereinafter referred to as "Trustee").
WITNESSETH:
That for value received, Lessor and Lessee do hereby covenant, promise and
agree as follows:
1. CERTAIN DEFINITIONS AND REFERENCE TERMS. To the extent any
capitalized term is not defined herein, such term shall have the meaning set
forth in Appendix A to that certain Participation Agreement dated as of April
23, 1999 by and among the Grantor, Veritas Software Corporation, a Delaware
corporation, the various parties thereto from time to time, as the Guarantors,
the various banks and other lending institutions which are parties thereto from
time to time, as Holders and Lenders, and NationsBank, N.A., as Agent for the
Lenders and the Holders.
2. DEMISED PREMISES AND DATE OF LEASE. Lessor has leased to Lessee, and
Lessee has leased from Lessor, for the Term (as hereinafter defined), certain
real property and other property located in Santa ▇▇▇▇▇ County, California which
is described in the attached Schedule I (the "Property"), pursuant to the terms
of a Master Lease Agreement between Lessor and Lessee dated as of April 23, 1999
(as such may be amended, modified, extended, supplemented, restated and/or
replaced from time to time, "Lease") and a Lease Supplement No. __ between
Lessor and Lessee dated as of April __, 1999 (the "Lease Supplement")
3. TERM, RENEWAL, EXTENSION AND PURCHASE OPTION. The term of the Lease
for the Property ("Term") commenced as of _________ __, 1999 and shall end as of
19__, unless the Term is extended or earlier terminated in accordance with the
provisions of the Lease. The Lease contains provisions for renewal and
extension. The tenant has a purchase option under the Lease.
4. TAX PAYER NUMBERS.
Lessor's tax payer number:____________
Lessee's tax payer number:____________
58
5. DEED OF TRUST; POWER OF SALE. (a) It is the intent of the parties
that: (i) the Lease constitutes an operating lease from Lessor to the Lessee for
purposes of the Lessee's financial reporting, (ii) the Lease and other
transactions contemplated hereby preserve ownership of the Properties in the
Lessee for federal and state income tax and bankruptcy purposes, (ii) the Lease
grants to Lessor a Lien on the Property covered thereby, and (iv) the
obligations of the Lessee to pay Basic Rent and any part of the Termination
Value shall be treated as payments of interest and principal, respectively, for
federal and state income tax and bankruptcy purposes. Lessor shall be deemed to
have a valid and binding security interest in and Lien on the Property, free and
clear of all Liens other than Permitted Liens, as security for the obligations
of the Lessee under the Operative Agreements (it being understood and agreed
that the Lessee does hereby ▇▇▇▇▇ ▇ ▇▇▇▇, and convey, transfer, assign, mortgage
and warrant to Lessor and its successors, transferees and assigns, the Property
and any proceeds or products thereof, to have and hold the same as collateral
security for the payment and performance of the obligations of the Lessee under
the Operative Agreements) each of the parties hereto agrees that it will not,
nor will it permit any Affiliate to at any time, take any action or fail to take
any action with respect to the preparation or filing or any income tax return,
including an amended income tax return, to the extent that such action or such
failure to take action would be inconsistent with the intention of the parties
expressed in this Section 5.
(b) Specifically, without limiting the generality of Section 5(a), the
parties hereto intend and agree that in the event of any insolvency or
receivership proceeds or a petition under the United States bankruptcy laws or
any other applicable insolvency laws or statute of the United States of America
or any state or commonwealth thereof affecting Lessee or Lessor or any
collection actions, the transactions evidenced by the Lease and the Operative
Agreements shall be regarded as loans made by the Lenders and the Holders to the
Lessee.
(c) Specifically, without limiting the generality of Section 5(b), the
Lessor and the Lessee intend and agree that with respect to the nature of the
transactions evidenced by the Lease in the context of the exercise of remedies
under the Operative Agreements, including, without limitation, in the case of
any insolvency or receivership proceedings or a petition under the United States
bankruptcy laws or any other applicable insolvency laws or statute of the United
States of America or any state or commonwealth thereof affecting the Lessee and
the Lessor, or any enforcement or collection actions, the transactions evidenced
by the Lease are loans made by the Lenders and the Holders as unrelated third
party lenders to the Lessee secured by the Property (it being understood that
the Lessee hereby mortgages, grants, bargains, sells, releases, confirms,
conveys, assigns, transfers and sets over to the Lessor, and grants a security
interest in, the Property (consisting of a leasehold deed of trust with respect
to all right, title and interest of the Lessee in and to the Land and a fee deed
of trust with respect to all right, title and interest of Lessee in and to the
fee title to, and reversionary interest in, the Property) and a leasehold deed
of trust on the Lessee's leasehold estate under the Lease, all to secure such
loans, effective on the date hereof, to have and to hold such interests in the
Property unto the Lessor and its successors and assigns, forever, provided
always that these presents are upon the express condition that, if all amounts
due under the Lease and the other Operative Agreements shall have been paid and
satisfied in full, then this instrument and the estate hereby granted shall
cease and become void.
2
59
As additional security for the Rent, the Termination Value and all other
sums owed to the Lessor by the Lessee under the Lease, the Lessee does hereby
grant, bargain, sell, transfer and convey unto the Trustee, its successors in
trust and assigns, IN TRUST, WITH POWER OF SALE, all of the Lessee's right,
title and interest in and to the Property, together with all of the right, power
and authority of the Lessee to alter, modify or change the terms, conditions and
provisions of the Lease and any other lease pertaining to the Property, to
consent to any request made by a tenant or landlord pursuant thereto, or to
surrender, cancel or terminate the same or to accept any surrender, cancellation
or termination of the same, together with all of the options, rights, powers and
privileges of the Lessee under any lease pertaining to the Property, whether
heretofore or hereafter existing, including, without limitation, the rights and
options to purchase the Property contained in Articles XIX and XX of the Lease,
and all present and future right, title and interest of the Lessee in and to (i)
all refunds, tax abatement agreements, rebates, reserves, deferred payments,
deposits, cost; savings, awards and payments of any kind due from or payable by
(a) any Governmental Authority, or (b) any insurance or utility company, in each
case under clause (a) or (b) above in respect of the Property, and (ii) all
refunds, rebates and payments of any kind due from or payable by any
Governmental Authority for any taxes, assessments, or governmental or
quasi-governmental charges or levies imposed upon the Lessee in respect of the
Property, and all plans and specifications, designs, drawings and other
information, materials and matters heretofore or hereafter prepared relating to
the Property or any construction on the Property, all proceeds (including claims
and demands therefor) of the conversion, voluntary or involuntary, of any of the
foregoing into cash or liquidated claims, including without limitation the
proceeds of insurance and condemnation awards in respect of the Property or any
portion thereof, all additional estates, rights and interests hereafter acquired
by the Lessee in the Property, or any portion thereof, together with all
proceeds of the conversion, whether voluntary or involuntary, of any of the
Property into cash or other liquid claims, including without limitation, all
awards, payments or proceeds, including interest thereon, and the right to
receive the same, which may be made as a result of any casualty, any exercise of
the right of eminent domain or deed in lieu thereof, any injury to the Property
and any defect in title in the Property or other matter insured under any policy
of title insurance, together with attorney's fees, costs and disbursements
incurred by the Lessor in connection with the collection of such awards,
payments and proceeds, and the Lessee further grants to the Lessor, pursuant to
the California Uniform Commercial Code (the "UCC"), a security interest in all
present and future right, title and interest of the Lessee in and to any portion
of the foregoing property for which a security interest may be created under the
UCC.
To have and to hold the same whether now owned or held or hereafter
acquired unto the Trustee, its successors-in-trust forever, IN TRUST, WITH POWER
OF SALE, to secure to the Lessor the payment of the Rent, the Termination Value
and all other sums owing to the Lessor under the Lease and the performance and
observance of the terms, covenants, warranties, conditions, agreements and
obligations under the Lease. If the Lessee shall pay all sums due under the
Lease when due according to the terms thereof and shall otherwise fully and
properly perform and comply with all of the obligations, agreements, terms and
conditions of the Lease, then this conveyance shall become null and void.
3
60
In the event of the occurrence of a Lease Event of Default, then the
Lessor shall have all rights and remedies set forth in the Lease including,
without limitation the right to foreclose its interest (or cause such interest
to be foreclosed) in any or all of the Property in accordance with applicable
law. The Trustee and the Lessor and each of them are authorized prior or
subsequent to the institution of any foreclosure proceedings to enter upon the
Property or any part thereof and to take possession of the Property and exercise
without interference from the Lessee, any and all rights which the Lessee has
with respect to the management, possession, operation, protection or
preservation of the Property: provided, however, that Lessee shall be entitled,
up to 30 days after the termination of the Lessee's occupancy of the Property to
enter the Property during normal business hours for the purpose of removing its
personal property and trade fixtures therefrom at its expense, provided that
such personal property and trade fixtures are not Improvements and Lessee
repairs any damage to the Improvements caused by such removal.
It is acknowledged that A POWER OF SALE HAS BEEN GRANTED IN THIS
INSTRUMENT; A POWER OF SALE MAY ALLOW THE LESSOR TO TAKE THE PROPERTY AND SELL
THEM WITHOUT GOING TO COURT IN A FORECLOSURE ACTION UPON DEFAULT BY THE LESSEE
UNDER THIS INSTRUMENT.
The proceeds of any sale held by Trustee or Lessor or any receiver or
public officer in foreclosure of the liens and security interests evidenced
hereby shall be applied first to all costs and expenses of the sale, including
but not limited to, reasonable Trustee's fees and then as provided in Section
22.2 of the Lease.
If the Lessor so elects, the Trustee may sell any personal property
covered by this instrument at one or more separate sales in any manner permitted
by the UCC. One or more exercises of the powers herein granted shall not
extinguish nor exhaust such powers until the entire Property is sold or until
the entire amounts evidenced and/or secured by the Lease and the Operative
Agreements is paid in full.
(d) Specifically, but without limiting the generality of Section 5(b),
the Lessor and the Lessee further intend and agree that, with respect to that
portion of the Property constituting personal property, for the purpose of
securing the Lessee's obligations for the repayment, of the above-described
obligations to the Lessor, (i) the Lease shall also be deemed to be a security
agreement and financing statement within the meaning of Article 9 of the UCC;
(ii) the conveyance provided for hereby shall be deemed to be a grant by the
Lessee to the Lessor of a lien and security interest in all of the Lessee's
present and future right, title and interest in and to such portion of the
Property, including but not limited to the Lessee's leasehold estate therein and
all proceeds of the conversion, voluntary or involuntary, of the foregoing into
cash, investments, securities or other property, whether in the form of cash,
investments, securities or other property to secure such obligations, effective
on the date hereof, to have and to hold such interests in the Property unto the
Lessor and its successors and assigns, forever, provided always that these
presents are upon the express condition that, if all amounts due under the Lease
shall have been paid and satisfied in full, then this instrument and the estate
hereby granted shall cease and become void; (iii) the possession by the Lessor
of notes and such other items of property as constitute instruments, money,
negotiable documents or chattel paper shall be deemed to be
4
61
"possession by the secured party" for purposes of perfecting the security
interest pursuant to Section 9-305 of the UCC: and (iv) notifications to Persons
holding such property, and acknowledgments, receipts or confirmations from
financial intermediaries, bankers or agents (as applicable) of the Lessee shall
be deemed to have been given for the purpose of perfecting such security
interest under applicable law. The Lessor and the Lessee shall, to the extent
consistent with this Memorandum, take such actions and execute, deliver, file
and record such other documents, Financing statements, mortgages and deeds of
trust as may be necessary to ensure that. if the Lease were deemed create a
security interest in the Property in accordance with this Section, such security
interest would be deemed to be a perfected security interest with priority over
all Liens other than Permitted Liens, under applicable law and will be
maintained as such throughout the Term.
6. EFFECT OF MEMORANDUM. The purpose of this instrument is to give
notice of the Lease and the Lease Supplement and their respective terms,
covenants and conditions to the same extent as if the Lease and the Lease
Supplement were fully set forth herein. This Memorandum shall not modify in any
mariner the terms, conditions or intent of the Lease or the Lease Supplement and
the parties agree that this Memorandum is not intended nor shall it be used to
interpret the Lease or the Lease Supplement or determine the intent of the
parties under the Lease or the Lease Supplement.
7. PURCHASE OPTION IN FAVOR OF Lessee. Lessee has a Purchase Option (as
such term is defined in Section 20.1 of the Lease) respecting the Property
pursuant to and in accordance with the terms and provisions of the Lease.
8. RATIFICATION. The terms and provisions of the Lease are hereby
ratified and confirmed and remain in full force and effect. In the event of any
conflict between the terms of the Lease and the terms of this Memorandum, the
terms of the Lease shall control.
9. GOVERNING LAW. THE LEASE AND THIS MEMORANDUM SHALL BE GOVERNED BY,
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF EXCEPT TO THE EXTENT
THE LAWS OF CALIFORNIA ARE REQUIRED TO APPLY WITH RESPECT TO THE RECORDING AND
ENFORCEMENT OF THIS MEMORANDUM.
10. COUNTERPART EXECUTION. This Memorandum may be executed in any number
of counterparts and by each of the parties hereto in separate counterparts, all
such counterparts together constituting but one and the same instrument.
11. FUTURE ADVANCES; REVOLVING CREDIT. In the event a court of competent
jurisdiction rules that this instrument constitutes a mortgage, deed of trust or
other secured financing as is the intent of the parties pursuant to Section 5
hereof, then this instrument will be deemed given to secure not only existing
financing, but also future advances made pursuant to or as provided in the
Lease, whether such advances are obligatory or to be made at the option of the
Lessor, or otherwise, to the same extent as if such future advances were made on
the date of
5
62
execution of this instrument, although there may be no advance made at the time
of execution hereof, and although there may be no financing outstanding at the
time any advance is made. To the fullest extent permitted by law, the lien of
this instrument shall be valid as to all such amounts, including all future
advances, from the time this instrument is recorded.
[The remainder of this page has been intentionally left blank.]
6
63
IN WITNESS WHEREOF, the parties hereto have duly executed this
instrument as of the day and year first written.
LESSOR:
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not individually, but
solely as the Owner Trustee under
the VS Trust 1999-1
By:______________________________________
Name:____________________________________
Title:___________________________________
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇. ▇▇▇▇▇
Vice President
LESSEE:
VERITAS SOFTWARE CORPORATION
By:______________________________________
Name:____________________________________
Title:___________________________________
Veritas Software Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇
64
STATE OF____________________
COUNTY OF___________________
On_________________before me,________________________, Notary Public in
and for said County and State, personally appeared__________________________ as
______________________of First Security Bank, National Association, not
individually but solely as Owner Trustee under the VS Trust 1999-1 personally
known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s) acted
executed the instrument.
WITNESS my hand and official seal.
Signature___________________________
(Seal)
65
STATE OF____________________
COUNTY OF___________________
On_____________________ before me,__________________________, Notary
Public in and for said County and State, personally
appeared___________________________ , as_________________________ of Veritas
Software Corporation, a Delaware corporation, personally known to me (or proved
to me on the basis of satisfactory evidence) to be the person(s) whose name(s)
is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and
that by his/her/their signature(s) on the instrument the person(s), or the
entity upon behalf of which the person(s) acted executed the instrument.
WITNESS my hand and official seal.
Signature___________________________
(Seal)
66
SCHEDULE 1
(Description of Property)
B-1