1
EXHIBIT 10.3
THIS AGREEMENT FOR LEASE IS
CONFIDENTIAL AND PROPRIETARY
EXECUTION COPY
================================================================================
AGREEMENT FOR LEASE
among
TCA Network Funding, Limited Partnership,
TA Operating Corporation
and
National Auto/Truckstops, Inc.
Dated as of September 9, 1999
===============================================================================
THIS AGREEMENT HAS BEEN ASSIGNED AS SECURITY
FOR INDEBTEDNESS OF THE OWNER. SEE SECTION 17.
This Agreement has been manually executed in 8 counterparts, numbered
consecutively from 1 through 8, of which this is No. __. To the extent, if any,
that this Agreement constitutes chattel paper (as such term is defined in the
Uniform Commercial Code as in effect in any jurisdiction), no security interest
in this Agreement may be created or perfected through the transfer or
possession of any counterpart other than the original counterpart which shall
be the counterpart identified as counterpart No. 1.
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THIS AGREEMENT FOR LEASE IS
CONFIDENTIAL AND PROPRIETARY
Page
TABLE OF CONTENTS
SECTION 1. DEFINITIONS...................................................................1
SECTION 2. APPOINTMENT OF AGENT.........................................................12
SECTION 3. ADVANCES.....................................................................14
SECTION 4. CONDITIONS PRECEDENT TO THE INITIAL ADVANCE WITH RESPECT TO A UNIT...........16
SECTION 5. CONDITIONS PRECEDENT TO OWNER'S OBLIGATION TO MAKE INTERIM ADVANCES
AFTER THE INITIAL ADVANCE WITH RESPECT TO A UNIT.............................20
SECTION 6. CONDITIONS PRECEDENT TO THE FINAL ADVANCE WITH RESPECT TO A UNIT.............22
SECTION 7. CONDITIONS PRECEDENT TO COMPLETION ADVANCES WITH RESPECT TO A UNIT...........24
SECTION 8. REPRESENTATIONS AND WARRANTIES OF EACH AGENT.................................25
SECTION 9. AFFIRMATIVE COVENANTS........................................................32
SECTION 10. NEGATIVE COVENANTS...........................................................40
SECTION 11. EVENTS OF DEFAULT AND EVENTS OF UNIT TERMINATION.............................41
SECTION 12. INDEMNITIES..................................................................49
SECTION 13. LEASEHOLD INTERESTS..........................................................50
SECTION 14. PURCHASES....................................................................50
SECTION 15. TERMINATION OF CERTAIN UNITS.................................................50
SECTION 16. PERMITTED CONTESTS...........................................................51
SECTION 17. SALE OR ASSIGNMENT BY OWNER..................................................52
SECTION 18. GENERAL CONDITIONS...........................................................52
SECTION 19. CERTAIN LIMITATIONS..........................................................59
EXHIBIT A THE LEASE
EXHIBIT B FORM OF AFL UNIT LEASING RECORD
EXHIBIT C FORM OF ACQUISITION CERTIFICATE
EXHIBIT D FORM OF INTERIM ADVANCE CERTIFICATE
EXHIBIT E FORM OF CERTIFICATE OF SUBSTANTIAL COMPLETION
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THIS AGREEMENT FOR LEASE IS
CONFIDENTIAL AND PROPRIETARY
PAGE
EXHIBIT F FORM OF CERTIFICATE OF INCREASED COST
EXHIBIT G FF&E SPECIFICATIONS
EXHIBIT H ENVIRONMENTAL CERTIFICATE
EXHIBIT I APPROVED UNIT PLANS
EXHIBIT J UNIT BUDGET FOR EACH UNIT
EXHIBIT K TA OPERATING CORPORATION UNIT PREMISES
EXHIBIT L NATIONAL AUTO/TRUCKSTOPS, INC. UNIT PREMISES
EXHIBIT M LIST OF ENVIRONMENTAL DOCUMENTS
SCHEDULE 1
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
PAGE
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EXECUTION COPY
EXHIBIT 10.3
THIS AGREEMENT FOR LEASE IS
CONFIDENTIAL AND PROPRIETARY
CONFIDENTIAL AND PROPRIETARY
----------------------------
LEASE AGREEMENT
Dated as of September 9, 1999
among
TCA Network Funding, Limited Partnership,
TA Operating Corporation
and
National Auto/Truckstops, Inc.
THIS LEASE HAS BEEN ASSIGNED AS SECURITY
FOR INDEBTEDNESS OF THE LESSOR. SEE SECTION 21.
This Lease has been manually executed in 8 counterparts, numbered consecutively
from 1 through 8 of which this is No. __. To the extent, if any, that this
Lease 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 may be created or perfected through the transfer or
possession of any counterpart other than the original executed counterpart
which shall be the counterpart identified as counterpart No. 1.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
CONFIDENTIAL
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LEASE AGREEMENT
Lease Agreement, dated as of September 9, 1999 (as the same may be
amended, restated, modified or supplemented from time to time, "THIS LEASE"),
among TCA Network Funding, Limited Partnership, a Delaware limited partnership,
as lessor, and TA Operating Corporation, a Delaware corporation and National
Auto/Truckstops, Inc., a Delaware corporation, as lessees.
SECTION 1. DEFINED TERMS.
Unless the context otherwise requires, each term defined in this
Section 1 shall, when used in this Lease, have the meaning indicated:
"ACCRUED DEFAULT OBLIGATIONS" has the meaning set forth in Section 19
hereof.
"ACQUISITION COST" means, without duplication, (i) in the case of a
Parcel of Property or Unit of Equipment acquired and built or installed
pursuant to the Agreement for Lease, an amount equal to the costs incurred by
the Lessor in connection with the acquisition, construction, installation and
financing of such Parcel or Unit pursuant to the Agreement for Lease; (ii) with
respect to any Unit of Equipment not installed pursuant to the Agreement for
Lease, an amount equal to the sum of (a) amounts paid to the vendor pursuant to
the vendor's invoice price therefor, including any progress payments, costs of
labor, delivery or installation, sales, use, excise or similar taxes and any
other charges included in such invoice (b) similar amounts paid with respect to
such Unit to parties other than the vendor of such Unit, (c) similar costs
incurred with respect to such Unit by the Lessee, and (d) legal, printing,
reproduction, closing and other normally capitalizable administrative fees and
expenses paid by the Lessee; and (iii) with respect to any Parcel of Property
not acquired and built pursuant to the Agreement for Lease, an amount equal to
the amounts included in clause (ii)(d) above which are applicable to such
Parcel plus (A) amounts paid to the vendor pursuant to the vendor's contract
price therefor, (B) vendee's closing costs, including, without limitation,
title insurance premiums, survey and survey inspection charges, recording and
filing fees, title closer fees, vendee's attorneys' fees and brokerage
commissions, (C) other costs related to the acquisition, including, without
limitation, appraisal, architectural, engineering, soil analysis, environmental
analysis and market analysis fees, and (D) any amounts paid by vendee on behalf
of vendor in addition to, and not as a credit against the contract price,
including, without limitation, payments made in satisfaction of prior liens,
and payment of any transfer, transfer gains or similar taxes imposed in respect
of the conveyance of such Property.
"ADDITIONAL RENT" has the meaning set forth in paragraph (d) of
Section 7 hereof.
"ADJUSTED ACQUISITION COST" means, at the time of determination, with
respect to any Parcel of Property or Unit of Equipment, its Acquisition Cost
less the aggregate amount of all Quarterly Rent Components paid as portions of
Basic Rent for such Parcel or Unit for any periods prior to the time of
determination of such Adjusted Acquisition Cost.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
"AFFILIATE" of any Person means any other Person controlling,
controlled by or under direct or indirect common control with such Person. For
the purposes of this definition, "CONTROL," when used with respect to any
specified Person, means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "CONTROLLING" and
"CONTROLLED" have meanings correlative to the foregoing.
"AFL UNIT LEASING RECORD" means an instrument, substantially in the
form of Exhibit C hereto, evidencing the lease or sublease under this Lease of
a Parcel of Property acquired and built pursuant to the Agreement for Lease and
the Unit or Units to be located thereon. The terms "lease" or "leased" when
used in this Lease shall be deemed to mean "sublease" or "subleased" when
referenced to the Property subleased pursuant to the AFL Unit Leasing Record.
"AGREEMENT FOR LEASE" means the Agreement for Lease, dated as of the
date hereof, between the Lessor, as owner, and the Lessee, as agent, providing
for the acquisition of a fee or leasehold interest in real property and the
construction of improvements on certain parcels of real property, as the same
may be amended, restated, modified or supplemented from time to time.
"APPLICABLE USURY LAW" has the meaning set forth in Section 33 hereof.
"APPRAISAL PROCEDURE" means the following procedure whereby an
independent appraiser shall be appointed by the Lessor and the Lessee, to
determine the fair market value rental of any Property or Equipment, if such
determination is required under paragraph (f) of Section 13 of this Lease. If
no such appraiser is appointed by the Lessor and the Lessee within ten (10)
days of the written request of either the Lessor or the Lessee that an
appraiser be appointed, the Lessor and the Lessee shall each appoint an
independent appraiser within fifteen (15) days thereafter, and the two
appraisers so appointed shall appoint a third independent appraiser, which
third appraiser shall have a minimum of three (3) years experience in
appraising property and equipment similar to the Travelstops and the Travelstop
Equipment. Each appraiser appointed pursuant to the foregoing procedure shall,
within ten (10) days after appointment of the last appraiser, independently
determine the fair market value rental. If the Lessor or the Lessee shall fail
to appoint an independent appraiser within the above mentioned fifteen (15) day
period, the appraiser appointed by the other party shall determine such value.
If a single appraiser is appointed, such appraiser's determination shall be
final. If three appraisers are appointed, the values determined by the three
appraisers shall be averaged, the value which differs the most from such
average shall be excluded, the remaining two values shall be averaged and such
average shall be final. The expenses of all appraisers shall be paid by the
Lessee.
"ASSIGNEE" means each Person to which any part of the Lessor's
interest under this Lease shall at the time have been assigned, conditionally
or otherwise, by the Lessor in accordance with Section 21 of this Lease. For
purposes of paragraphs (d), (f), (g) and (s) of Section 2, paragraphs (d) and
(e) of Section 5, paragraph (b) of Section 9, clauses (i) and (v) of paragraph
(d) of Section 10, Section 11, the last sentence of paragraph (b) of Section
21, clause (iii) of paragraph (a) of Section 28, and paragraph (b) of Section
29 hereof, the term "Assignee" shall include each lender to the Lessor that is
a signatory to a Credit Agreement.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
"ASSIGNMENT" means each assignment agreement referred to in Section 21
hereof, between the Lessor and a third party, pursuant to which the Lessor
assigns certain of its rights under this Lease to such third party, as the same
may be amended, restated, modified or supplemented from time to time.
"BASIC RENT" means, with respect to any Parcel of Property or Unit of
Equipment:
(a) At each Basic Rent Payment Date during the Lease Term of
such Parcel or Unit, and in respect of the quarterly period (or partial
quarterly period ) beginning on the first day following the immediately
preceding Basic Rent Payment Date (or, in the case of the first Basic Rent
Payment Date in the Lease Term with respect to such Parcel or Unit, beginning
on the Effective Date), and ending on such Basic Rent Payment Date, the sum of
the Quarterly Rent Component plus an amount (the "VARIABLE COMPONENT OF BASIC
RENT") equal to the sum of (X) plus (Y) plus (Z), where (X), (Y) and (Z) have
the following meanings:
(X) (i) the Equity Capital before payment of
Basic Rent for such quarterly period (or
partial quarterly period), multiplied by
(ii) a fraction having a numerator equal to the
number of days in such quarterly period (or
partial quarterly period) and a denominator
of 360, multiplied by
(iii) the decimal equivalent of a
percentage equal to the LIBOR Rate
plus 9.5 %.
(Y) (i) the Debt Capital before payment of
Basic Rent for such quarterly period (or
partial quarterly period), multiplied by
(ii) a fraction having a numerator equal to the
number of days in such quarterly period (or
partial quarterly period) and a denominator
of 360, multiplied by
(iii) the decimal equivalent of a percentage
equal to the Quarterly Cost of Project
Debt.
(Z) (i) the Adjusted Acquisition Cost before
payment of Basic Rent for such quarterly
period (or partial quarterly period),
multiplied by
(ii) a fraction having a numerator equal to the
number of days in such quarterly period (or
partial quarterly period) and a denominator
of 365, or in a leap year, 366, multiplied
by
(iii) .0015.
(b) For each quarterly period during the Renewal Term, if any,
of such Parcel or Unit, an amount equal to the fair market value rental
thereof, determined as provided in paragraph (e) of Section 13 hereof.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
"BASIC RENT PAYMENT DATE" means March 20th, June 20th, September 20th
and December 20th during the Lease Term or any Renewal Term of any Property or
Equipment or, if such day is not a Business Day, the next succeeding Business
Day.
"BP ENVIRONMENTAL AGREEMENT" means the Environmental Agreement, dated
as of July 22, 1993, among BP Exploration & Oil Inc., TA Operating Corporation
and certain other parties, as the same may be amended, restated, modified or
supplemented from time to time.
"BUSINESS DAY" means any day other than a Saturday, a Sunday or a day
on which banking institutions in the City of New York are authorized by law to
close.
"CERCLA" has the meaning set forth in paragraph (r) of Section 2
hereof.
"CHANGE OF CONTROL" means, with respect to the Guarantor or both
Lessees, any change (whether pursuant to one transaction or a series of
transactions) resulting in direct or indirect legal or beneficial ownership of
fifty-one percent (51%) or more of the ordinary voting stock of the Guarantor
or both Lessees being transferred to parties other than current shareholders
(or their family members or trusts for the benefit of such shareholders or
their family members).
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMPUTATION PERIOD" has the meaning set forth in subclause (a)(iii)
of the definition of Basic Rent in Section 1 hereof.
"CREDIT AGREEMENT" means each credit, loan or participation agreement
which has been entered into between the Lessor and a lender or lenders related
to the financing of Property or Equipment, as the same may be amended,
restated, modified, supplemented or replaced from time to time.
"DEBT CAPITAL" means, at the time of determination, an amount equal to
the Adjusted Acquisition Cost of such Parcel or Unit minus the Equity Capital
with respect to such Parcel or Unit.
"EFFECTIVE DATE" means, with respect to any Parcel of Property or Unit
of Equipment, the date on which such Parcel or Unit becomes subject to this
Lease, as evidenced by execution by the Lessor of an AFL Unit Leasing Record or
a Unit Leasing Record, as the case may be, with respect to such Parcel or Unit.
"ENVIRONMENTAL APPROVALS" means all Governmental Actions, permits,
consents, licenses and other approvals or authorizations required under
Environmental Requirements.
"ENVIRONMENTAL DAMAGES" means all claims, judgments, damages
(including punitive damages), losses, penalties, fines, interest, fees,
liabilities (including strict liability), taxes, obligations, encumbrances,
liens, costs and expenses (including, without limitation, costs and expenses of
investigation and defense of any claim, whether or not such claim is ultimately
defeated, and of any good faith settlement or judgment), of whatever kind or
nature, contingent or otherwise, matured or unmatured, foreseeable or
unforeseeable, direct or indirect, including, without limitation, reasonable
attorneys' fees and disbursements and consultants' fees, any of
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
which are asserted, imposed or incurred at any time pursuant to Environmental
Requirements, including, without limitation:
(i) Damages arising from the past, present or future existence of
any Hazardous Substances at any location or noncompliance
with or violation of any Environmental Requirements other
than to the extent such Damages arise from or relate to acts
or omissions occurring, or circumstances or conditions
created or existing, at any time following the expiration or
earlier termination of this Lease;
(ii) Damages for personal injury or threatened personal injury
(including sickness, disease or death), or injury or
threatened injury to property or natural resources,
foreseeable or unforeseeable, including, without limitation,
the cost of demolition and rebuilding of any improvements on
real property;
(iii) Reasonable fees incurred for the services of attorneys,
consultants, contractors, doctors, experts, laboratories and
all other reasonable costs incurred in connection with any
damages as described in subparagraph (i) of this definition,
and the investigation or remediation of Hazardous Substances
or the suspected presence of Hazardous Substances or the
violation or threatened violation of Environmental
Requirements, including, but not limited to, the preparation
of any feasibility studies or reports or the performance of
any investigation, cleanup, treatment, remediation, removal,
response, abatement, containment, closure, storage, disposal,
transport, restoration or monitoring work required by any
Governmental Authority, or otherwise expended in connection
with such conditions, and including, without limitation, any
reasonable attorneys' fees, costs and expenses incurred in
enforcing the provisions of this Lease or the Agreement for
Lease relating to Environmental Requirements or collecting
any sums due under such provisions; and
(iv) Liability to any third Person or Governmental Authority to
indemnify such Person or Governmental Authority for costs expended in
connection with the items referenced in subparagraphs (i), (ii) and (iii) of
this definition.
"ENVIRONMENTAL DOCUMENTS" has the meaning described in the Agreement
for Lease.
"ENVIRONMENTAL EVENT" has the meaning set forth in paragraph (v) of
Section 2 hereof.
"ENVIRONMENTAL LIEN" means a Lien in favor of any Governmental
Authority for (a) liability under any Environmental Requirement or (b) damages
arising from or costs incurred by, such Governmental Authority in response to a
Release or threatened Release of any Hazardous Substance into the environment.
"ENVIRONMENTAL MATTER" means any matter, fact or situation relating to
or arising from (a) any violation or alleged violation of, or compliance or
noncompliance with, an Environmental Requirement, (b) any Release or threatened
Release of any Hazardous Substance on, under or from the Property or Equipment
or the presence of any Hazardous Substance which has come to be located on,
from or under the Property or Equipment, or (c) any injury or alleged injury to
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
human health or safety or the environment by reason of the matters described in
clauses (a) and (b) above.
"ENVIRONMENTAL REQUIREMENTS" means all applicable federal, state and
local laws (including duties under the common law), statutes, codes,
ordinances, rules, regulations, directives, binding policies, permits,
authorizations, judgments, decrees, requirements or orders of any Governmental
Authority relating to or addressing the environment, natural resources or human
health, including, but not limited to, any law, statute, code, ordinance, rule,
regulation, directive, binding policy, permit, authorization or order relating
to (a) the use, handling or Release or threatened Release of any Hazardous
Substance or (b) worker health. Environmental Requirements shall include all
applicable Environmental Requirements now or hereinafter enacted, made or
issued whether or not presently contemplated.
"EQUIPMENT" means personal property of any type leased or to be leased
hereunder and, when leased, evidenced by Unit Leasing Records or AFL Unit
Leasing Records, and all related appliances, appurtenances, accessions,
furnishings, materials and parts leased or to be leased by the Lessor to the
Lessee as provided herein and including all replacements and subsequent
replacements of such related appliances, appurtenances, accessions,
furnishings, materials and parts. "UNIT", when referring to the personal
property leased under this Lease, means a particular item of Equipment, as the
context may require. Notwithstanding the foregoing, any item of property that
is deemed to be Property shall be deemed not to be Equipment for purposes of
this Lease.
"EQUITY CAPITAL" means, at the time of determination, the aggregate
amount of cash contributions to the Lessor's capitalization made by the
Lessor's general partner and limited partners constituting a part of Adjusted
Acquisition Cost with respect to all Property and Equipment subject to this
Lease, plus any undistributed Return on Equity Capital with respect to such
Property and Equipment, less the aggregate amount of any returns of equity
capital made to such partners at such time with respect to such Property and
Equipment; PROVIDED that, for purposes of the definitions of "Basic Rent" and
"Debt Capital" in this Lease, the reference therein to "Equity Capital" shall
not include any undistributed Return on Equity Capital.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that is, was or hereafter becomes a member of a group of which
the Lessee is a member and which is treated as a single employer under Section
414 of the Code.
"ERISA PLAN" means any pension plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code that
is maintained for employees of the Lessee or any ERISA Affiliate.
"EVENT OF DEFAULT" has the meaning set forth in Section 18 hereof.
"GAAP" means generally accepted accounting principles as in effect
from time to time in the United States, applied on a consistent basis.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
"GENERAL PARTNER" means TCA Network Capital, Inc., a Delaware
corporation, and its successors and assigns, which is the general partner of
the Lessor.
"GOVERNMENTAL ACTION" has the meaning set forth in paragraph (d) of
Section 2 hereof.
"GOVERNMENTAL AUTHORITY" means any nation or government, any state or
other political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"GROUND LEASE" means each ground lease (which must be a Mortgageable
Ground Lease) pursuant to which a leasehold interest in a Parcel of Property is
being leased to the Lessor.
"GUARANTOR" means TravelCenters of America, Inc., a Delaware
corporation (an Affiliate of the Lessee), and its successors.
"GUARANTY" means the Corporate Guaranty, dated as of the date hereof,
from the Guarantor to the Lessor, as the same may be amended, restated,
modified or supplemented from time to time.
"HAZARDOUS SUBSTANCE" means any pollutant, contaminant, substance,
hazardous substance, radioactive substance, toxic substance, hazardous waste,
medical waste, radioactive waste, special waste, petroleum or petroleum-derived
substance or waste, asbestos, polychlorinated biphenyl, or any constituent
thereof which is regulated under Environmental Requirements as potentially
harmful to human health or the environment.
"INDEBTEDNESS" means for any Person (i) all indebtedness or other
obligations of such Person for borrowed money, (ii) all obligations of such
Person to pay the deferred purchase price of property or services, including
any such obligations created under or arising out of any conditional sale or
other title retention agreement, (iii) all obligations of such Person
(contingent or otherwise) under reimbursement or similar agreements with
respect to the issuance of letters of credit, (iv) all indebtedness or other
obligations of such Person under or in respect of any swap, cap, collar or
other financial hedging arrangement, (v) all indebtedness or other obligations
of any other Person of the type specified in clause (i), (ii), (iii) or (iv)
above, the payment or collection of which such Person has guaranteed (except by
reason of endorsement for collection in the ordinary course of business) or in
respect of which such Person is liable, contingently or otherwise, including,
without limitation, liable by way of agreement to purchase products or
securities, to provide funds for payment, to maintain working capital or other
balance sheet conditions or otherwise to assure a creditor against loss, and
(vi) all indebtedness or other obligations of any other Person of the type
specified in clause (i), (ii), (iii), (iv) or (v) above secured by (or for
which the holder of such indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien, upon or in property (including, without
limitation, accounts and contract rights) owned by such Person, whether or not
such Person has assumed or becomes liable for the payment of such indebtedness
or obligations.
"INDEMNIFIED PERSON" has the meaning set forth in Section 11 hereof.
"INSURANCE REQUIREMENTS" means all terms of any insurance policy
covering or applicable to any Property or Equipment, all requirements of the
issuer of any such policy, all statutory
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requirements and all orders, rules, regulations and other requirements of any
governmental body related to insurance applicable to any Property or Equipment.
"LEASE RATE DATE" has the meaning set forth in paragraph (b) of
Section 7 hereof.
"LEASE TERM" means the term commencing on the Effective Date with
respect to any Parcel of Property or Unit of Equipment and ending on the
seventh anniversary of the date of this Lease.
"LEGAL REQUIREMENTS" means all laws, judgments, decrees, ordinances
and regulations and any other governmental rules, orders and determinations and
all requirements having the force of law, now or hereinafter enacted, made or
issued, whether or not presently contemplated, including, without limitation,
compliance with all requirements of labor laws and Environmental Requirements,
compliance with which is required at any time from the date hereof through the
Lease Term and any Renewal Term, whether or not such compliance shall require
structural, unforeseen or extraordinary changes to any Property or Equipment or
the operation, occupancy or use thereof.
"LESSEE" means each of TA Operating Corporation and National
Auto/Truckstops, Inc., in its joint and several capacity. Each of TA Operating
Corporation and National Auto/Truckstops, Inc. are hereinafter sometimes
referred to as "LESSEE" and as "LESSEES". TA Operating Corporation will act as
lessee for each Parcel of Property and Unit of Equipment described on Exhibit E
hereto and National Auto/Truckstops, Inc. will act as lessee for each Parcel of
Property and Unit of Equipment described on Exhibit F hereto; PROVIDED,
HOWEVER, that TA Operating Corporation and National Auto/Truckstops, Inc. will
be jointly and severally liable to the Lessor for any and all obligations of
the Lessee or the Lessees under this Lease.
"LESSOR" means TCA Network Funding, Limited Partnership or any
successor or successors to all of its rights and obligations as the Lessor
hereunder and, for purposes of Section 11 hereof, shall include any partnership
(general or limited), corporation, limited liability company, trust, individual
or other entity which computes its liability for income or other taxes on a
consolidated basis with TCA Network Funding, Limited Partnership or the income
of which for purposes of such taxes is, or may be, determined or affected
directly or indirectly by the income of the Lessor or its successor or
successors.
"LIBOR RATE" shall have the meaning assigned to the term "Reserve
Adjusted LIBOR" in the Loan and Security Agreement, dated as of the date
hereof, between the Lessor and General Electric Capital Corporation, for itself
and as agent for the Loan Participants (as such term is defined therein), as
the same may be amended, restated, modified or supplemented from time to time.
"LIEN" means any security interest, mortgage, pledge, hypothecation,
assignment, encumbrance, lien (statutory or other), or other security agreement
of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing
of any financing statement under the Uniform Commercial Code or comparable law
of any jurisdiction in respect of any of the foregoing).
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
"MANAGEMENT AGREEMENT" means the Management Agreement, dated as of the
date hereof, between the Lessor and ▇▇▇▇▇▇▇ Leasing, as the same may be
amended, restated, modified or supplemented from time to time.
"MAXIMUM RATE" has the meaning set forth in Section 33 hereof.
"▇▇▇▇▇▇▇" means ▇▇▇▇▇▇▇ ▇▇▇▇▇ Money Markets Inc., a Delaware
corporation.
"▇▇▇▇▇▇▇ LEASING" means ML Leasing Equipment Corp., a Delaware
corporation.
"▇▇▇▇▇▇▇ ▇▇▇▇▇" means ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., Inc., a Delaware
corporation.
"MORTGAGEABLE GROUND LEASE" means a ground lease for a Parcel of
Property to be subleased to the Lessee which is delivered to the Lessor for
execution by the Lessor, or assigned to the Lessor by an assignment in form and
substance satisfactory to the Lessor, and having such terms and characteristics
as may be required by the Lessor and any Assignee, which terms and
characteristics shall include, without limitation, the following: (a) free
assignability to (i) any lender as security for a borrowed money obligation of
the Lessor and, upon foreclosure of such security, freely assignable by such
lender to any third party, and (ii) any purchaser in connection with a sale of
such Parcel of Property pursuant to the provisions of this Lease or the
Agreement for Lease (the Lessor and any Assignee being released from liability
upon such assignment); (b) a term (including renewals) of at least ten (10)
years in excess of the Lease Term of the Parcel of Property to which such
ground lease relates; (c) no provisions for percentage or variable rent; (d)
permit any lawful use; (e) no provision for a security deposit; (f) a
requirement that any Assignee or any lender will receive copies of all notices
of default delivered under or pursuant to such ground lease; (g) a provision
that any Assignee or any lender shall have the right to cure any defaults
thereunder (whether monetary or nonmonetary in nature), and in the event of
such cure to receive a new ground lease on the same terms as the original
ground lease; (h) a no recourse section in accordance with the language set
forth in Section 31 hereof except substituting the Lessee for the Lessor; (i) a
prohibition of any mortgages or other Liens on the underlying fee, except
Permitted Liens; and (j) no provision requiring the Lessor to indemnify any
Person. A Mortgageable Ground Lease shall be delivered with such estoppel
certificates, recognition and attornment agreements, or confirmation of
customary mortgagee protection as are reasonably acceptable to the Lessor and
any Assignee. Each Ground Lease must be a Mortgageable Ground Lease.
"MULTIEMPLOYER PLAN" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA to which the Lessee or any ERISA Affiliate (other than one
considered an ERISA Affiliate only pursuant to subsection (m) or (o) of Section
414 of the Code) is making or accruing an obligation to make contributions, or
has within any of the preceding five plan years made or accrued an obligation
to make contributions.
"NPL" has the meaning set forth in paragraph (r) of Section 2 hereof.
"OPERATIVE DOCUMENTS" means, collectively, this Lease, the Agreement
for Lease, and all other documents, certificates, instruments and agreements
entered into by the Lessee on the date hereof in connection with the
transactions contemplated hereby.
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THIS LEASE AGREEMENT IS
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PROPRIETARY
"OTHER CHARGES" has the meaning set forth in Section 33 hereof.
"PARTICIPATION AGREEMENT" means that certain Participation Agreement,
dated as of the date hereof, among the Lessor, the Agent (as such term is
defined therein), the Guarantor and the Lessee, as the same may be amended,
restated, modified or supplemented from time to time.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.
"PCBS" has the meaning set forth in paragraph (r) of Section 2 hereof.
"PERMITTED CONTEST" has the meaning set forth in paragraph (a) of
Section 28 hereof.
"PERMITTED LIENS" means the following Liens and other matters
affecting the title of any Parcel of Property or Unit of Equipment: (a) Liens
securing the payment of taxes, assessments and other governmental charges or
levies which are either not delinquent or, if delinquent, are being contested
by the Lessee in good faith as a Permitted Contest; (b) all applicable Legal
Requirements, including Legal Requirements relating to zoning and subdivision
restrictions, (c) easements, rights-of-way, licenses, reservations, covenants,
conditions, waivers, restrictions on the use of any Parcel of Property,
encroachments and other title or survey defects which either (i) are in effect
as of the date hereof and have been disclosed to the Lessor in writing or (ii)
do not individually or in the aggregate materially impair the intended use or
value of such Parcel of Property by the Lessee; (d) reservations of mineral
interests; (e) the Liens created pursuant to a Credit Agreement; (f) leases and
licenses in effect with respect to any Parcel of Property which are permitted
by this Lease or which are delivered to and accepted by the Lessor and any
Assignee prior to such Parcel's Effective Date; (g) mechanics' liens arising in
the ordinary course of business on or in respect of any Parcel of Property and
for amounts the payment of which is either not yet delinquent or is the subject
of a Permitted Contest; (h) the rights and interest of any sublessee permitted
by the terms of this Lease; (i) exceptions to the title of any Parcel of
Property as set forth in the title insurance policy delivered to the Lessor
pursuant to Section 4 of the Agreement for Lease or Section 5 of this Lease;
(j) Liens in connection with financing statements covering "CAT scales" and
other equipment owned by third parties but located on or at a Parcel of
Property pursuant to operating agreements or subleases between such third
parties and the Lessee; and (k) such other or additional matters as may be
approved in writing by the Lessor and any Assignee.
"PERSON" means any individual, corporation, partnership, limited
liability company, private limited company, joint venture, association
joint-stock company, trust, unincorporated organization of government or any
agency or political subdivision thereof.
"PLEDGE AGREEMENT" means the Pledge Agreement, dated as of the date
hereof, by and among the Lessee, as pledgor, and the Lessor, as pledgee, as it
may be amended, restated, modified or supplemented from time to time, a copy of
which is attached as Exhibit D hereto.
"PLEDGED CONTRACTS" means the Unocal Environmental Agreement and the
BP Environmental Agreement, in each case solely as such agreements relate to
any Parcel of Property or Unit of Equipment leased under this Lease from time
to time, and all such other contracts listed on Schedule A to the Pledge
Agreement.
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THIS LEASE AGREEMENT IS
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PROPRIETARY
"POTENTIAL DEFAULT" means any event which, but for the lapse of time,
or giving of notice, or both, would constitute an Event of Default.
"PRIMARY USE" has the meaning set forth in paragraph (f) of Section 9
hereof.
"PROPERTY" means any and all parcels of land together with all
buildings and other improvements (including, without limitation, the
attachments, appliances, equipment, machinery and other affixed property which,
in each case, would constitute "fixtures" under Section 9-313(1)(a) of the
Uniform Commercial Code) now or hereafter located on such parcels of land,
leased or to be leased hereunder and when leased, evidenced by Unit Leasing
Records or AFL Unit Leasing Records, and the respective easements, rights and
appurtenances relating to such parcels of land, buildings and improvements.
"PARCEL" or "PARCEL OF PROPERTY" means a specific parcel or parcels of
Property.
"QUARTERLY COST OF PROJECT DEBT" means the Lessor's weighted average
percentage cost per annum (including, without duplication, any interest
accruing at a default rate and any facility, commitment or other fees under a
Credit Agreement) of borrowings outstanding at any time during the period from
and including the 16th day of the calendar month in which such quarterly period
begins to and including the 15th day of the calendar month in which such Basic
Rent Payment Date occurs (the "COMPUTATION PERIOD") to finance or refinance the
acquisition and ownership of Property and Equipment; PROVIDED, that if the
Effective Date for such Parcel or Unit falls on or after the Lease Rate Date
during the first month of such partial first quarterly period such decimal
shall be the decimal determined as of the next succeeding Lease Rate Date.
"QUARTERLY RENT COMPONENT" means, (i) with respect to each quarterly
period during the Lease Term of any Parcel of Property or Unit of Equipment
(other than a Parcel acquired and built pursuant to the Agreement for Lease),
the amount set forth on Schedule I to the Unit Leasing Record relating to such
Parcel or Unit for such quarterly period, as such schedule may be amended from
time to time pursuant to the terms of this Lease, or (ii) with respect to each
quarterly period during the Lease Term of any Parcel of Property acquired and
built pursuant to the Agreement for Lease, the amount set forth on Schedule I
to the AFL Unit Leasing Record relating to such Parcel for such quarterly
period, as such schedule may be amended from time to time pursuant to the terms
of this Lease.
"RECOGNITION AND ATTORNMENT AGREEMENT" means a Non-Disturbance,
Recognition and Attornment Agreement, substantially in the form attached as
Exhibit G hereto, which may be entered into by the Lessor, the Lessee and
certain subtenants of the Lessee pursuant to paragraph (e) of Section 8 hereof.
"RECONCILIATION AMOUNT" has the meaning set forth in paragraph (f) of
Section 7 hereof.
"RELEASE" means the release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migrating into
the indoor or outdoor environment of any Hazardous Substance through or in the
air, soil, surface water, groundwater, or any structure.
"REMEDIAL ACTION" means actions required or undertaken by a
Governmental Authority, or which are appropriate as a matter of prudent
business practice and commercial reasonableness, to (i) clean up, remove, treat
or in any other way address Hazardous Substances in the indoor or
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THIS LEASE AGREEMENT IS
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PROPRIETARY
outdoor environment; (ii) prevent the Release or threat of Release or minimize
the further Release of Hazardous Substances; or (iii) investigate and determine
if a remedial response is needed, and to design such a response and
post-remedial investigation, monitoring, operation, maintenance and care.
"RENEWAL TERM" has the meaning set forth in paragraph (e) of Section
13 hereof.
"REPORTABLE EVENT" means any reportable event as defined in Section
4043(b) of ERISA or the regulations issued thereunder with respect to an ERISA
Plan (other than a Plan maintained by an ERISA Affiliate that is considered an
ERISA Affiliate only pursuant to subsection (m) or (o) of Section 414 of the
Code).
"RESIDUAL AMOUNT" means, as to any Parcel of Property or Unit of
Equipment, an amount equal to (i) at the end of the Lease Term, seventy-five
point seven five percent (75.75%) of the Adjusted Acquisition Cost of such
Parcel or Unit or (ii) at the end of the Renewal Term, a percentage of the
Adjusted Acquisition Cost of such Parcel or Unit to be agreed to between the
Lessee and the Lessor prior to the commencement of such Renewal Term.
"RESPONSIBLE OFFICER" means with respect to a particular Lessee, any
executive officer or financial officer of such Lessee or, if acting as agent of
such Lessee, any employee of the Guarantor primarily responsible for
administering the obligations of such Lessee hereunder.
"STATED RATE" has the meaning set forth in Section 33 hereof.
"SURRENDER COVENANTS" has the meaning set forth in paragraph (b) of
Section 13 hereof.
"SURRENDER DATE" means the date, if any, the Lessee surrenders any
Property and Equipment under this Lease to the Lessor pursuant to Section 13
hereof, which date shall be either the last Business Day in the Lease Term or
the last Business Day of any Renewal Term with respect to such Property and
Equipment.
"TANKS" has the meaning set forth in paragraph (g) of Section 9
hereof.
"TAKING" has the meaning set forth in paragraph (a) of Section 16
hereof.
"TERMINATION EVENT" has the meaning set forth in paragraph (a) of
Section 14 hereof.
"TRANSACTIONS" has the meaning set forth in Section 33 hereof.
"TRANSACTION DOCUMENTS" has the meaning set forth in Section 33 hereof.
"TRAVELCENTERS CREDIT AGREEMENT" means the Credit Agreement, dated as
of March 21, 1997, as amended and restated as of November 24, 1998, among the
Guarantor, the lenders parties thereto and The Chase Manhattan Bank, as Agent
for such lenders and as the Fronting Bank and Swingline Lender, as the same may
be amended, restated, modified or supplemented from time to time.
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THIS LEASE AGREEMENT IS
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PROPRIETARY
"TRAVELSTOP" means any Property designed for use as a travel center,
fuel station, truck maintenance and repair center and/or convenience store and
related improvements on the same Parcel.
"TRAVELSTOP EQUIPMENT" means all the Equipment, if any, used and (if
such Equipment has been acquired by the Lessor but not yet delivered by the
vendor) to be used, at a particular Travelstop, the lease of which is evidenced
by an AFL Unit Leasing Record.
"UNDEVELOPED PROPERTY" has the meaning set forth in paragraph (c) of
Section 12 hereof.
"UNECONOMIC EQUIPMENT" has the meaning set forth in paragraph (c) of
Section 14 hereof.
"UNIT" has the meaning set forth in the definition of Equipment in
Section 1 hereof.
"UNIT LEASING RECORD" means an instrument, substantially in the form
of Exhibit C hereto, evidencing, except in the case of any Parcel or Parcels of
Property acquired and built pursuant to the Agreement for Lease and the Unit or
Units to be located thereon, the lease of any Parcel or Parcels of Property or
Unit or Units of Equipment under this Lease.
"UNOCAL ENVIRONMENTAL AGREEMENT" means the Environmental Agreement,
dated as of November 23, 1992, between Union Oil Company of California and
National Auto/Truckstops, Inc., as the same may be amended, restated, modified
or supplemented from time to time.
"WITHDRAWAL LIABILITY" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF EACH
LESSEE.
Each Lessee represents, warrants and covenants to the Lessor:
(a) CORPORATE MATTERS. The Lessee (i) has been duly incorporated
and is validly existing as a corporation in good standing under the laws of the
State of Delaware, (ii) has full power, authority and legal right to own and
operate its properties and to conduct its business as presently conducted and
to execute, deliver and perform its obligations under the Operative Documents,
and (iii) is duly qualified to do business as a foreign corporation in good
standing in each jurisdiction in which its ownership or leasing of properties
or the conduct of its business requires such qualification, except where the
failure to comply with the foregoing clauses (ii) and (iii) would not impair
the ability of the Lessee to perform its obligations under the Operative
Documents in a timely manner or the ability of the Guarantor to perform its
obligations under the Guaranty in a timely manner.
(b) BINDING AGREEMENTS. (i) The Operative Documents have been
duly authorized, executed and delivered by the Lessee and, assuming the due
authorization, execution and delivery of the Operative Documents by the Lessor,
the Operative Documents are legal, valid and binding obligations of the Lessee,
enforceable according to their respective terms.
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THIS LEASE AGREEMENT IS
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(ii) The Guaranty has been duly authorized, executed and delivered by the
Guarantor and is a legal, valid and binding obligation of the
Guarantor, enforceable according to its terms.
(c) COMPLIANCE WITH OTHER INSTRUMENTS. The execution, delivery
and performance by the Lessee of the Operative Documents will not result in any
violation of any term of the articles of incorporation or the by-laws of the
Lessee, do not require stockholder approval or the approval or consent of any
trustee or holders of indebtedness of the Lessee except such as have been
obtained prior to the date hereof and will not conflict with or result in a
breach of any terms or provisions of, or constitute a default under, or result
in the creation or imposition of any Lien (other than a Permitted Lien) upon
any property or assets of the Lessee under, any indenture, mortgage or other
agreement or instrument to which the Lessee is a party or by which it or any of
its property is bound, or any existing applicable law, rule, regulation,
license, judgment, order or decree of any Governmental Authority or court
having jurisdiction over the Lessee or any of its activities or properties,
except for any possible conflict with, breach of or default under, any
indenture, mortgage or other agreement or instrument, which conflict, breach,
default or violation could reasonably be expected to have a material adverse
effect on (i) the operation, maintenance, use or value of any Parcel of
Property or Unit of Equipment, (ii) the ability of the Lessee to perform its
obligations under the Operative Documents in a timely manner or the ability of
the Guarantor to perform its obligations under the Guaranty in a timely manner
or (iii) the rights or interests of the Lessor or Assignee under this Lease or
the Agreement for Lease.
(d) GOVERNMENTAL CONSENTS. There are no consents, licenses,
orders, authorizations, approvals, Environmental Approvals, permits, waivers,
extensions or variances of, or notices to or registrations or filings with
(each a "GOVERNMENTAL ACTION"), any Governmental Authority or public body or
authority which are or will be required in connection with the valid execution,
delivery and performance of the Operative Documents, or any Governmental Action
(i) which is or will be required in connection with any participation by the
Lessor or Assignee in the transactions contemplated by any ▇▇▇▇ of sale, deed,
assignment, assumption, ownership agreement, operating agreement, or other
agreement relating to any Property or Equipment or (ii) which is or will be
required to be obtained by the Lessor, the Lessee, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Leasing,
any Assignee or any Affiliate of the foregoing, during the term of this Lease,
with respect to any Property or Equipment except such Governmental Actions, (A)
as have been or will be in a timely manner duly obtained, given or
accomplished, (B) as may be required by applicable law not now in effect, (C)
which may be required as a result of the business, properties or activities of
the Lessor, any Assignee or any Affiliate of the foregoing and which are not
solely dependent on the nature of any Parcel of Property or Unit of Equipment
under this Lease or the business of the Lessee, or (D) which, individually or
in the aggregate, if not obtained or effected, (x) will not place the Lessor or
any Assignee in any danger of civil liability for which the Lessor or any
Assignee is not adequately indemnified for hereunder or subject the Lessor or
any Assignee to any danger of criminal liability as a result of failure to
comply therewith, (y) will not result in a material diminution in the value of
any Parcel of Property or Unit of Equipment and (z) will not impair the ability
of the Lessee to perform its obligations under the Operative Documents in a
timely manner or the ability of the Guarantor to perform its obligations under
the Guaranty in a timely manner.
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THIS LEASE AGREEMENT IS
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PROPRIETARY
(e) FINANCIAL STATEMENTS. The Lessee has furnished to the Lessor
copies of its annual unaudited financial statements for the fiscal year ended
December 31, 1998 and the Guarantor's Annual Report on Form 10-K for the fiscal
year ended December 31, 1998. The financial statements contained in such
documents fairly present the financial position, results of operations and
statements of cash flows of the Lessee and the Guarantor as of the dates and
for the periods indicated therein and have been prepared in accordance with
GAAP.
(f) MATERIAL ADVERSE CHANGE. Since December 31, 1998, there has
been no material adverse change in the assets, properties, operations,
prospects, consolidated financial condition, contingent liabilities or business
of the Guarantor which could reasonably be expected to have a material adverse
effect on (i) the operation, maintenance, use or value of any Parcel of
Property or Unit of Equipment, (ii) the ability of the Lessee to perform its
obligations under this Lease or the Agreement for Lease in a timely manner or
the ability of the Guarantor to perform its obligations under the Guaranty in a
timely manner or (iii) the rights or interests of the Lessor or Assignee under
this Lease or the Agreement for Lease.
(g) LITIGATION. There is no action, suit, proceeding or
investigation at law or in equity by or before any court, governmental body,
agency, commission or other tribunal now pending or, to the knowledge of the
Lessee, threatened against or affecting the Lessee or the Guarantor or any
property or rights of the Lessee or the Guarantor with respect to which there
exists a reasonable possibility of a decision or judgment which would (i)
question the validity or enforceability of this Lease or the Pledged Contracts,
(ii) materially adversely affect any Parcel of Property or Unit of Equipment,
(iii) impair the ability of the Lessee to perform its obligations under this
Lease or the ability of the Guarantor to perform its obligations under the
Guaranty, or (iv) the rights or interests of the Lessor or Assignee under this
Lease or the Agreement for Lease.
(h) DELIVERY OF INFORMATION. The Lessee shall deliver to the
Lessor and any Assignee from time to time, (i) promptly upon their becoming
available, and, in any event, not more than 105 days after the end of each
fiscal year of the Lessee, copies of the Lessee's annual unaudited financial
statements and the Guarantor's Annual Reports on Form 10-K, and, promptly upon
their becoming available, and, in any event, not more than sixty (60) days
after the end of each fiscal quarter of the Lessee, copies of the Lessee's
quarterly unaudited financial statements and the Guarantor's Quarterly Reports
on Form 10-Q and, promptly upon filing, any other reports the Guarantor files
with the Securities and Exchange Commission, (ii) promptly, and in any event
within ten (10) Business Days upon request, such other information with respect
to the Lessee's and the Guarantor's operations, business, property, assets,
financial condition or litigation as the Lessor or any Assignee shall
reasonably request, (iii) promptly, and in any event within five (5) Business
Days after a Responsible Officer obtains knowledge of any Event of Default or
Potential Default hereunder, or any default or alleged default by any party to
a Pledged Contract, a certificate of a Responsible Officer specifying the
nature and period of existence of such Event of Default or Potential Default,
or default under a Pledged Contract, and what action, if any, the Lessee has
taken, is taking, or proposes to take with respect thereto, (iv) promptly, and
in any event within five (5) Business Days after a Responsible Officer obtains
knowledge of any material adverse change in the financial condition or business
of the Lessee or the Guarantor of the type described in paragraph (f) of this
Section 2 or of any litigation of the type described in paragraph (g) of this
Section 2, a certificate of a Responsible Officer describing such change or
litigation as the case may be, (v) promptly, and in any event within five (5)
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THIS LEASE AGREEMENT IS
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PROPRIETARY
Business Days after a Responsible Officer obtains knowledge of any and all
Liens, other than Permitted Liens, on any Parcel of Property or Unit of
Equipment, a detailed statement of a Responsible Officer describing each such
Lien and (vi) simultaneously with the delivery of each set of financial
statements referred to in clause (i) of this paragraph (h), a certificate of a
Responsible Officer stating, to the best knowledge of such Responsible Officer
after reasonable inquiry, (1) whether there exists on the date of such
certificate any Event of Default or Potential Default hereunder or any default
under any Pledged Contract, and if any Event of Default, Potential Default or
default under any Pledged Contract exists, specifying the nature and period of
existence thereof and what action, if any, the Lessee has taken, is taking, or
proposes to take with respect thereto and (2) setting forth computations in
reasonable detail satisfactory to the Lessor and Assignee demonstrating
compliance with the covenant contained in paragraph (u) of this Section 2.
(i) ACCURACY OF APPRAISAL. The information furnished by the
Lessee to the appraiser for use by such appraiser in its appraisal report with
respect to any Parcel of Property or Unit of Equipment is accurate and complete
in all material respects.
(j) COMPLIANCE WITH LEGAL REQUIREMENTS AND INSURANCE
REQUIREMENTS. The operation, use and physical condition of the Property and
Equipment are in full compliance with all Legal Requirements and Insurance
Requirements and all premiums due with respect to such Insurance Requirements
have been paid, except any Legal Requirement, the noncompliance with which,
individually or in the aggregate, (i) will not place the Lessor or any Assignee
in any danger of civil liability for which the Lessor or any Assignee is not
adequately indemnified for hereunder or subject the Lessor or any Assignee to
any danger of criminal liability as a result of failure to comply therewith,
(ii) will not result in a material diminution in the value of any Parcel of
Property or Unit of Equipment and (iii) will not impair the ability of the
Lessee to perform its obligations under the Operative Documents in a timely
manner or the ability of the Guarantor to perform its obligations under the
Guaranty in a timely manner.
(k) LIENS. No Property or Equipment is subject to any Lien,
except for Permitted Liens.
(l) AGREEMENT FOR LEASE. The Property acquired and built
pursuant to the Agreement for Lease was acquired and built in accordance with
the terms of the Agreement for Lease. The representations and warranties of the
Lessee, as agent, in the Agreement for Lease are true and correct in all
material respects.
(m) ERISA. The Lessee and its ERISA Affiliates are in compliance
in all material respects with the applicable provisions of ERISA and the
regulations and published interpretations thereunder. No Reportable Event has
occurred, been waived or exists as to which the Lessee or any ERISA Affiliate
was or is required to file a report with the PBGC, and the present value of all
benefit liabilities under each ERISA Plan (based on those assumptions used to
fund such ERISA Plan) did not, as of the last annual valuation date applicable
thereto, exceed by more than $2,000,000 the value of the assets of such ERISA
Plan. Neither the Lessee nor any ERISA Affiliate has incurred any Withdrawal
Liability that could result in a material adverse effect on (i) the operation,
maintenance, use or value of any Parcel of Property or Unit of Equipment, (ii)
the ability of the Lessee to perform its obligations under the Operative
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THIS LEASE AGREEMENT IS
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Documents in a timely manner or (iii) the rights or interests of the Lessor or
Assignee under this Lease or the Agreement for Lease. Neither the Lessee nor
any ERISA Affiliate has received any notification that any Multiemployer Plan
is in reorganization or has been terminated within the meaning of Title IV of
ERISA, and no Multiemployer Plan is reasonably expected to be in reorganization
or to be terminated where such reorganization or termination has resulted or
could reasonably be expected to result, through increases in the contributions
required to be made to such ERISA Plan or otherwise, in a material adverse
effect on (A) the operation, maintenance, use or value of any Parcel of
Property or Unit of Equipment, (B) the ability of the Lessee to perform its
obligations under the Operative Documents in a timely manner or (C) the rights
or interests of the Lessor or Assignee under this Lease or the Agreement for
Lease.
(n) STATUS OF LESSEE. On the date hereof, not less than
fifty-one percent (51%) of the common stock of each of TA Operating Corporation
and National Auto/Truckstops, Inc. is owned (directly or indirectly)
beneficially and of record by the Guarantor.
(o) TAXES. The Lessee has filed or caused to be filed all tax
returns which are required to be filed by it, and has paid all taxes shown to
be due and payable on said returns or on any assessments made against it or any
of its assets and properties and has paid all other taxes, fees or other
charges imposed on it by any Governmental Authority (except taxes, fees and
charges subject to a Permitted Contest).
(p) GROUND LEASE. Each Ground Lease has been duly authorized,
executed and delivered by the Lessee and is a legal, valid and binding
obligation of the Lessee enforceable according to its terms. Each Ground Lease
is a Mortgageable Ground Lease except to the extent agreed to in writing by the
Lessor and Assignee, and is in full force and effect.
(q) PLEDGE AGREEMENT. The Pledge Agreement has been duly
authorized, executed and delivered by the Lessee and, assuming the due
authorization, execution and delivery of the Pledge Agreement by the Lessor, is
a legal, valid and binding obligation of the Lessee, enforceable according to
its terms. The Pledge Agreement creates a valid security interest in the
Collateral (as defined in the Pledge Agreement) now in existence, securing the
payment of the Secured Obligations (as defined in the Pledge Agreement). All
action necessary to perfect the security interest in the Collateral has been
taken and such security interest has priority over any other Lien on the
Collateral, except for Permitted Liens.
(r) ENVIRONMENTAL DISCLOSURE. Except as expressly identified in
the Pledged Contracts and Environmental Documents:
(1) To the best knowledge of the Lessee, after due inquiry,
the Lessee and the Property and the Equipment comply with, and have at all
times complied with all Environmental Requirements applicable to the Property
and the Equipment, including, without limitation, the use, maintenance and
operation of the Property and the Equipment, and all activities and conduct of
business related thereto, including, without limitation, the use, handling,
management, storage, disposal, removal, transport, treatment and/or remediation
of any Hazardous Substance, except where noncompliance, individually or in the
aggregate, (i) will not place the Lessor or any Assignee in any danger of civil
liability for which the Lessor or any Assignee is not adequately indemnified
hereunder or subject the Lessor or any Assignee to any
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THIS LEASE AGREEMENT IS
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danger of criminal liability, (ii) will not result in a diminution in the value
of any Parcel of Property or Unit of Equipment, (iii) will not impair the
ability of the Lessee to perform its obligations under the Operative Documents
in a timely manner or the ability of the Guarantor to perform its obligations
under the Guaranty in a timely manner and (iv) will not impair the rights or
interests of the Lessor or Assignee under this Lease or the Agreement for
Lease.
(2) The Lessee has obtained all Environmental Approvals
necessary in connection with the ownership of and operations at the Property
and any activities or conduct performed thereon, and all such Environmental
Approvals are in good standing (subject to Permitted Contests), and the Lessee
is currently in compliance with all terms and conditions of such Environmental
Approvals, except where noncompliance, individually or in the aggregate, (i)
will not place the Lessor or any Assignee in any danger of civil liability for
which the Lessor or any Assignee is not adequately indemnified hereunder or
subject the Lessor or any Assignee to any danger of criminal liability, (ii)
will not result in a diminution in the value of any Parcel of Property or Unit
of Equipment, (iii) will not impair the ability of the Lessee to perform its
obligations under the Operative Documents in a timely manner or the ability of
the Guarantor to perform its obligations under the Guaranty in a timely manner
and (iv) will not impair the rights or interests of the Lessor or Assignee
under this Lease or the Agreement for Lease. There are no proceedings pending
or threatened as to which there exists a reasonable possibility of a decision
or judgment which would question the validity of any such Environmental
Approvals.
(3) The Lessee has not received, and is not otherwise aware
of, any notice, directive, citation, subpoena, summons, order to show cause,
complaint or other written communication concerning any alleged violation of
Environmental Requirements relating to or affecting the Property or the
Equipment or relating to or arising out of (x) the Release or threatened
Release of Hazardous Substances at, on, from, beneath or affecting a Parcel of
Property, or (y) the condition, ownership, use, maintenance or operation of a
Parcel of Property or Unit of Equipment by the Lessee or by any prior owner or
operator of the Property or Equipment, except with respect to any such alleged
violations that (a) are subject to a Permitted Contest, (b) have been remedied
or (c)(1) individually or in the aggregate, (i) will not place the Lessor or
any Assignee in any danger of civil liability for which the Lessor or any
Assignee is not adequately indemnified for hereunder or subject the Lessor or
any Assignee to any danger of criminal liability, (ii) will not result in a
diminution in the value of any Parcel of Property or Unit of Equipment, (iii)
will not impair the ability of the Lessee to perform its obligations under the
Operative Documents in a timely manner or the ability of the Guarantor to
perform its obligations under the Guaranty in a timely manner and (iv) will not
impair the rights or interests of the Lessor or Assignee under this Lease or
the Agreement for Lease, and (2) which violations will be remedied prior to the
time that such violations, individually or in the aggregate, (i) place the
Lessor or any Assignee in any danger of civil liability for which the Lessor or
any Assignee is not adequately indemnified for hereunder or subject the Lessor
or any Assignee to any danger of criminal liability, (ii) result in a
diminution in the value of any Parcel of Property or Unit of Equipment, (iii)
impair the ability of the Lessee to perform its obligations under the Operative
Documents in a timely manner or the ability of the Guarantor to perform its
obligations under the Guaranty in a timely manner or (iv) impair the rights or
interests of the Lessor or Assignee under this Lease or the Agreement for
Lease.
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(4) To the best knowledge of the Lessee, there has been no
material adverse change in the facts or circumstances reported in or assumed in
the Environmental Documents.
(5) To the best knowledge of the Lessee, there has been no
Release of any Hazardous Substances (i) on, from, or beneath the Property or
Equipment for which a Remedial Action must be taken or which affects the
Property or Equipment, or (ii) at any location where any Hazardous Substances
used, handled, managed, stored, generated, removed or Released at or in
connection with the Property or Equipment have been transported, treated,
stored, handled, disposed of, transferred, recycled or received, either (in the
case of clauses (i) and (ii)) by the Lessee or any other Person for whose
conduct the Lessee is or may be held responsible under applicable Environmental
Requirements and (in the case of clauses (i) and (ii)) which will result in
material costs to the Lessee, the Lessor, any Assignee or any Indemnified
Person pursuant to Environmental Requirements.
(6) To the best knowledge of the Lessee, there are currently
no agreements, consent orders, decrees or other directives (other than
directives of environmental statutes, regulations or permits issued in the
ordinary course of business) of any applicable court or Governmental Authority
requiring any Remedial Actions with respect to the use, handling, management,
storage, Release, removal, transport, treatment or generation of any Hazardous
Substance on, from, beneath or affecting the Property or Equipment.
(7) There are no underground or above-ground storage tanks
(whether or not currently in use) located on or beneath the Property, nor to
the Lessee's knowledge after due inquiry, have there ever been such tanks
located on the Property in a condition not in compliance with Environmental
Requirements.
(8) Neither the Lessee nor any of its Affiliates has given
notice to any insurance broker or insurance carrier that there has been an
occurrence relating to the use, handling, management, storage or Release of
Hazardous Substances on, from, beneath or affecting the Property.
(9) The Lessee has not, by contract, agreement, or otherwise,
arranged for disposal or treatment, or arranged with a transporter for
transport for disposal or treatment, of any Hazardous Substances to any
location which is listed on the National Priorities List ("NPL") as defined
under the Comprehensive Environmental Response Compensation and Liability Act,
as amended, 42 U.S.C. 9601 et seq. ("CERCLA"), or which is listed for possible
inclusion on the NPL, or which is subject to any regulatory action which may
lead to claims under CERCLA.
(10) No Environmental Lien is attached to any portion of the
Property.
(11) Neither the Lessee nor, to the knowledge of the Lessee,
any contractor engaged in connection with the Property has engaged in or
permitted, any operations or activities upon, or any use or occupancy of, the
Property or any portion thereof, for the purpose of or in any way involving the
Release of any Hazardous Substance in a manner not in compliance with
Environmental Requirements or the handling, storage, use or disposal of any
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Hazardous Substance in a manner not in compliance with Environmental
Requirements, except where noncompliance, individually or in the aggregate, (A)
will not place the Lessor or any Assignee in any danger of civil liability for
which the Lessor or any Assignee is not adequately indemnified hereunder or
subject the Lessor or any Assignee to any danger of criminal liability, (B)
will not result in a diminution in the value of any Parcel of Property or Unit
of Equipment, (C) will not impair the ability of the Lessee to perform its
obligations the Operative Documents in a timely manner or the ability of the
Guarantor to perform its obligations under the Guaranty in a timely manner and
(D) will not impair the rights or interests of the Lessor or Assignee under
this Lease or the Agreement for Lease, nor has the Lessee caused any Hazardous
Substance to be released or otherwise come to be located on, under, in or about
the Property, nor to the knowledge of Lessee has any Hazardous Substance
migrated from the Property onto or underneath other properties, in either case
in a condition or under circumstances that could reasonably be expected to (A)
place the Lessor or any Assignee in any danger of civil liability for which the
Lessor or any Assignee is not adequately indemnified for hereunder or subject
the Lessor or any Assignee to any danger of criminal liability, (B) result in a
diminution in the value of any Parcel of Property or Unit of Equipment, (C)
impair the ability of the Lessee to perform its obligations under the Operative
Documents in a timely manner or the ability of the Guarantor to perform its
obligations under the Guaranty in a timely manner or (D) impair the rights or
interests of the Lessor or Assignee under this Lease or the Agreement for
Lease.
(12) To the best knowledge of the Lessee, there is not
constructed, placed, deposited, stored, disposed nor located on the Property
any asbestos in any form which has become or threatens to become friable.
(13) To the best knowledge of the Lessee, there is not
constructed, placed, deposited, released, stored, disposed, leached not located
on the Property any polychlorinated biphenyls ("PCBS") or transformers,
capacitors, ballasts, or other equipment which contain dielectric fluid
containing PCBs in a condition not in compliance with applicable Environmental
Requirements, except where noncompliance, individually or in the aggregate, (i)
will not place the Lessor or any Assignee in any danger of civil liability for
which the Lessor or any Assignee is not adequately indemnified for hereunder or
subject the Lessor or any Assignee to any danger of criminal liability, (ii)
will not result in a diminution in the value of any Parcel of Property or Unit
of Equipment, (iii) will not impair the ability of the Lessee to perform its
obligations under the Operative Documents in a timely manner or the ability of
the Guarantor to perform its obligations under the Guaranty in a timely manner
and (iv) will not impair the rights or interests of the Lessor or Assignee
under this Lease or the Agreement for Lease.
(s) NO DEFAULT. Neither the Lessee nor the Guarantor is in violation
of or in default under or with respect to any Legal Requirement in any respect
which could reasonably be expected to have a material adverse effect on (i) the
operation, maintenance, use or value of any Parcel of Property or Unit of
Equipment, (ii) the ability of the Lessee to perform its obligations under the
Operative Documents in a timely manner or the ability of the Guarantor to
perform its obligations under the Guaranty in a timely manner or (iii) the
rights or interests of the Lessor or Assignee under this Lease or the Agreement
for Lease.
(t) INVESTMENT COMPANY ACT. Neither Lessee is an "investment company"
or a company "controlled" by an "investment company" within the meaning of the
Investment
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Company Act of 1940, as amended, or an "investment advisor" within the meaning
of the Investment Act of 1940, as amended
(u) YEAR 2000 PROBLEM. The Lessee has reviewed the areas within its
business and operations which could be adversely affected by, and has developed
or is developing a program to address on a timely basis, the "Year 2000
Problem" (that is, the risk that computer applications used by the Lessee may
be unable to recognize and perform properly date-sensitive functions involving
certain dates prior to and any date on or after December 31, 1999), and has
made related appropriate inquiry of material suppliers and vendors. Based on
such review and program, the Lessee believes that the "Year 2000 Problem" will
not have a Material Adverse Effect. As used herein "Material Adverse Effect"
shall mean (i) a material adverse effect on the business, condition (financial
or otherwise), operations, performance or properties of the Lessee, or (ii) a
material impairment of the ability of the Lessee to perform its obligations
under or to remain in compliance with the Operative Documents. From time to
time, at the request of the Lessor or any Assignee, the Lessee shall provide to
the Lessor and such Assignee such updated information or documentation as is
requested regarding the status of its efforts to address the Year 2000 Problem.
(v) ENVIRONMENTAL COVENANTS.
(1) The Lessee and the Property and the Equipment shall
comply, and the Lessee shall use all reasonable efforts to cause the compliance
by any contractors engaged in connection with the Property, with all
Environmental Requirements applicable to the Property and the Equipment and
activities and conduct of business performed thereon, including, without
limitation, the use, maintenance and operation of the Property and the
Equipment and all activities and conduct performed thereon, including, without
limitation, the use, storage, removal, transport, treatment and/or remediation
of any Hazardous Substance, except where noncompliance, individually or in the
aggregate, (i) will not place the Lessor or any Assignee in any danger of civil
liability for which the Lessor or any Assignee is not adequately indemnified
for hereunder or subject the Lessor or any Assignee to any danger of criminal
liability, (ii) will not result in a diminution in the value of any Parcel of
Property or Unit of Equipment, (iii) will not impair the ability of the Lessee
to perform its obligations under the Operative Documents in a timely manner or
the ability of the Guarantor to perform its obligations under the Guaranty in a
timely manner and (iv) will not impair the rights or interests of the Lessor or
Assignee under this Lease or the Agreement for Lease.
(2) The Lessee shall maintain all Environmental Approvals
necessary to conduct operations at the Property and shall comply with all such
Environmental Approvals, except where noncompliance, individually or in the
aggregate, (i) will not place the Lessor or any Assignee in any danger of civil
liability for which the Lessor or any Assignee is not adequately indemnified
hereunder or subject the Lessor or any Assignee to any danger of criminal
liability, (ii) will not result in a diminution in the value of any Parcel of
Property or Unit of Equipment, (iii) will not impair the ability of the Lessee
to perform its obligations under the Operative Documents in a timely manner or
the ability of the Guarantor to perform its obligations under the Guaranty in a
timely manner and (iv) will not impair the rights or interests of the Lessor or
Assignee under this Lease or the Agreement for Lease.
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(3) The Lessee shall not cause or suffer or permit the
attachment of any Environmental Lien to the Property or any portion thereof,
except for such Environmental Liens as the Lessee is contesting pursuant to a
Permitted Contest.
(4) The Lessee shall not cause, and shall use all reasonable
efforts not to suffer or permit the transportation or arrangement for the
transport of any Hazardous Substance from the Property to any facility or site
for the purpose of treatment or disposal which is (i) included on the NPL or
(ii) is subject to a Remedial Action requirement (other than routine
anticipated regulatory requirements), except any Remedial Action which (A) will
not place the Lessor or any Assignee in any danger of civil liability for which
the Lessor or any Assignee is not adequately indemnified hereunder or subject
the Lessor or any Assignee to any danger of criminal liability, (B) will not
result in a diminution in the value of any Parcel of Property or Unit of
Equipment, (C) will not impair the ability of the Lessee to perform its
obligations under the Operative Documents in a timely manner or the ability of
the Guarantor to perform its obligations under the Guaranty in a timely manner
and (D) will not impair the rights or interests of the Lessor or Assignee under
this Lease or the Agreement for Lease, or (iii) which has not obtained or
maintained all Environmental Approvals required pursuant to applicable
Environmental Requirements.
(5) The Lessee shall not engage in or permit any operations
or activities upon, or any use or occupancy of, the Property or any portion
thereof, for the purpose of or in any way involving the Release of any
Hazardous Substance in a manner not in compliance with Environmental
Requirements or the handling, storage, use or disposal of any Hazardous
Substance in a manner not in compliance with Environmental Requirements, except
where noncompliance, individually or in the aggregate, (i) will not place the
Lessor or any Assignee in any danger of civil liability for which the Lessor or
any Assignee is not adequately indemnified for hereunder or subject the Lessor
or any Assignee to any danger of criminal liability, (ii) will not result in a
diminution in the value of any Parcel of Property or Unit of Equipment, (iii)
will not impair the ability of the Lessee to perform its obligations under the
Operative Documents in a timely manner or the ability of the Guarantor to
perform its obligations under the Guaranty in a timely manner and (iv) will not
impair the rights or interests of the Lessor or Assignee under this Lease or
the Agreement for Lease, and the Lessee shall not cause any Hazardous Substance
to be released or otherwise come to be located on, under, in or about the
Property, nor to the knowledge of the Lessee has any Hazardous Substance
migrated from the Property onto or underneath other properties, in either case
in a condition or under circumstances that could reasonably be expected to (A)
place the Lessor or any Assignee in any danger of civil liability for which the
Lessor or any Assignee is not adequately indemnified for hereunder or subject
the Lessor or any Assignee to any danger of criminal liability, (B) result in a
diminution in the value of any Parcel of Property or Unit of Equipment, (C)
impair the ability of the Lessee to perform its obligations under the Operative
Documents in a timely manner or the ability of the Guarantor to perform its
obligations under the Guaranty in a timely manner or (D) impair the rights or
interests of the Lessor or Assignee under this Lease or the Agreement for
Lease.
(6) The Lessee shall not cause or suffer the use or Release
of any asbestos-containing material or any article of PCBs in connection with
the remodeling construction of the Property.
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(7) (i) The Lessee shall promptly, but in any case within ten
(10) Business Days of receiving actual notice thereof, notify the Lessor and
Assignee if, after the date of this Lease, (A) any Environmental Matter has
occurred or any environmental condition is discovered in, on, beneath, from or
involving the Property or any part thereof (including, without limitation, the
presence or Release of Hazardous Substances or the violation of Environmental
Requirements) that could reasonably be expected to result in Environmental
Damages against the Lessee, the Lessor, any Assignee or any Indemnified Person
in excess of $300,000, or (B) the Lessee has received notification that it, the
Property or any part thereof is the subject of a proceeding that could
reasonably be expected to result in any ordered remediation or corrective
action or other liability related to an environmental event or condition, the
cost of which liability to the Lessee is reasonably expected to exceed $300,000
(each of (A) and (B) and "ENVIRONMENTAL EVENT").
(ii) Following receipt of a notice pursuant to (i) above, the
Lessor and Assignee, in each case in their reasonable discretion, may require
the Lessee to conduct, or cause to be conducted, an environmental audit of the
Property by an environmental consultant reasonably satisfactory to the Lessor
and Assignee, the scope of which audit shall be limited to confirming the
magnitude and anticipated cost of the liability resulting from the
Environmental Matter and to provide a copy of such environmental consultant's
report to the Lessor and Assignee.
(iii) The Lessee shall initiate, or cause to be initiated at
no cost to the Lessor or Assignee, in a timely fashion, such actions as may be
necessary to comply in all respects with all applicable Environmental
Requirements, except where noncompliance, individually or in the aggregate, (A)
will not place the Lessor or any Assignee in any danger of civil liability for
which the Lessor or any Assignee is not adequately indemnified for hereunder or
subject the Lessor or any Assignee to any danger of criminal liability, (B)
will not result in a diminution in the value of any Parcel of Property or Unit
of Equipment, (C) will not impair the ability of the Lessee to perform its
obligations under the Operative Documents in a timely manner or the ability of
the Guarantor to perform its obligations under the Guaranty in a timely manner
and (D) will not impair the rights or interests of the Lessor or Assignee under
this Lease or the Agreement for Lease and to alleviate any significant risk to
human health or the environment if the same arises from a condition on or in
respect of the Property or any part thereof, whether existing on or prior to
the date of this Lease. Once the Lessee commences such actions, the Lessee
shall thereafter diligently proceed to comply materially and in a timely manner
with all Environmental Requirements.
(w) COMPLIANCE WITH FINANCIAL COVENANTS. The Lessee agrees that it
will cause the Guarantor to comply with the covenants set forth in Sections
7.13, 7.14, 7.15, 7.16 and 7.17 of the TravelCenters Credit Agreement;
PROVIDED, that the Lessee's obligation to cause the Guarantor to comply with
such Sections of the TravelCenters Credit Agreement shall survive the
termination or ceasing to be in effect for any reason whatsoever of the
TravelCenters Credit Agreement and the Lessee agrees to comply with such
covenants, notwithstanding any such termination or ceasing to be in effect
until such date as this Lease shall be terminated in accordance with the terms
hereof.
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SECTION 3. LEASE OF PROPERTY OR EQUIPMENT.
(a) Subject to the terms and conditions hereof, the Lessor
shall lease to the Lessee, and the Lessee shall lease from the Lessor pursuant
to this Lease, any Property or Equipment of the type described on Exhibit A
hereto; PROVIDED, that:
(i) such Property or Equipment is available for
purchase;
(ii) except with respect to any Parcel of Property
or Unit of Equipment acquired and built pursuant to the
Agreement for Lease, the Lessor has approved the purchase
order or acquisition with respect to such Equipment or the
acquisition with respect to such Property (which approval
shall be in the sole discretion of the Lessor);
(iii) at the time any such Property or Equipment is
to be ordered or leased hereunder there exists no Event of
Default or Potential Default;
(iv) with respect to any Property acquired and built
pursuant to the Agreement for Lease, Substantial Completion
(as defined in the Agreement for Lease) shall have occurred;
and
(v) the sum of (A) the Acquisition Cost of such
Property or Equipment and (B) the aggregate Acquisition Cost
of all other Property or Equipment leased hereunder would
not, at the time any such Property or Equipment is to be
leased hereunder, exceed such amount as the Lessor and the
Lessee may from time to time agree.
(b) The lease hereunder of Parcels of Property and related
Units of Equipment acquired and built pursuant to the Agreement for Lease shall
be evidenced by an AFL Unit Leasing Record. Subject to the terms of paragraph
(a) of Section 3 hereof, upon Substantial Completion (as defined in the
Agreement for Lease) of a Parcel or Parcels of Property acquired and built
pursuant to the Agreement for Lease, the Lessee shall prepare an AFL Unit
Leasing Record. The AFL Unit Leasing Record shall give a full description of
the Property (and the applicable Equipment), its Acquisition Cost, its Lease
Term, the Quarterly Rent Component with respect to such Property or Equipment
and such other details as the Lessor and the Lessee may from time to time
agree. Within five (5) Business Days of the Lessor's receipt of the Certificate
of Substantial Completion relating to a Parcel or Parcels of Property and a
Unit or Units of Equipment to be leased hereunder, satisfaction of the other
requirements of the Agreement for Lease and receipt of a completed and executed
AFL Unit Leasing Record, the Lessor shall execute the AFL Unit Leasing Record
and deliver it to the Lessee. The AFL Unit Leasing Record shall have an
Effective Date as of the date of execution by the Lessor of the AFL Unit
Leasing Record. Execution and delivery by the Lessee of an AFL Unit Leasing
Record shall constitute (i) acknowledgment by the Lessee that the Property and
Equipment, if any, specified in such AFL Unit Leasing Record has been delivered
to the Lessee in good condition and has been accepted for lease hereunder by
the Lessee as of the Effective Date of such AFL Unit Leasing Record, (ii)
acknowledgment by the Lessee that the Property and Equipment, if any, specified
in such AFL Unit Leasing Record is subject to all of the covenants, terms and
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conditions of this Lease, (iii) certification by the Lessee that the
representations and warranties contained in Section 2 of this Lease (except for
the representation contained in paragraph (f) and clause (8) of paragraph (r)
of Section 2 hereof) are true and correct in all material respects on and as of
the Effective Date of such AFL Unit Leasing Record as though made on and as of
such date and that there exists on such date no Event of Default or Potential
Default, and (iv) certification by the Lessee that on and as of the Effective
Date of such AFL Unit Leasing Record, there has been no material adverse change
in the assets, properties, operations, prospects, consolidated financial
condition, contingent liabilities or business of the Guarantor since the date
of this Lease, which could reasonably be expected to have a material adverse
effect on (1) the ability of the Lessee to perform its obligations under this
Lease or the Agreement for Lease in a timely manner or the ability of the
Guarantor to perform its obligations under the Guaranty in a timely manner or
(2) the rights or interests of the Lessor or Assignee under this Lease or the
Agreement for Lease.
(c) The lease of each Parcel of Property, other than a Parcel
of Property acquired and built pursuant to the Agreement for Lease, or Unit of
Equipment, other than a Unit of Equipment appropriately included in an AFL Unit
Leasing Record, to the Lessee under this Lease shall be evidenced by a Unit
Leasing Record. The Lessee shall prepare and execute a Unit Leasing Record with
respect to each such Parcel of Property or Unit of Equipment (which Unit
Leasing Record may relate to more than one Unit of Equipment) and deliver it
promptly to the Lessor. Contemporaneously with the payment required by
paragraph (b) of Section 5 hereof, the Lessor shall execute the acceptance of
such Unit Leasing Record and promptly return one copy of such Unit Leasing
Record to the Lessee.
(d) The Lessee shall prepare each Unit Leasing Record
pursuant to the procedures provided by the Lessor. Each Unit Leasing Record
shall give a full description of the Parcel or Parcels of Property or Unit or
Units of Equipment covered thereby, the Acquisition Cost of each such Parcel or
Unit, the Lease Term for each such Parcel or Unit, its location and such other
details as the Lessor and the Lessee may from time to time agree.
(e) Execution by the Lessee of a Unit Leasing Record shall
constitute (i) acknowledgment by the Lessee that the Property or Equipment
specified in such Unit Leasing Record has been delivered to the Lessee in good
condition and has been accepted for lease hereunder by the Lessee as of the
Effective Date, (ii) acknowledgment by the Lessee that the Property or
Equipment specified in such Unit Leasing Record is subject to all of the
covenants, terms and conditions of this Lease, and (iii) certification by the
Lessee that the representations and warranties contained in Section 2 of this
Lease (except for the representation contained in paragraph (f) and clause (8)
of paragraph (r) of Section 2 hereof) are true and correct in all material
respects on and as of the Effective Date as though made on and as of the
Effective Date and that there exists on the Effective Date no Event of Default
or Potential Default.
(f) In connection with any Parcel of Property acquired and
built pursuant to the Agreement for Lease, within six (6) months of the Final
Advance (as defined in the Agreement for Lease) with respect to such Parcel,
the Lessee may deliver to the Lessor a Certificate of Increased Cost (as
defined in the Agreement for Lease) pursuant to the Agreement for Lease setting
forth the actual amount expended by the Lessee for items included in the Unit
Budget (as defined in the Agreement for Lease) with respect to such Parcel
while it was subject to the
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Agreement for Lease. If, based upon such Certificate of Increased Cost, a
Completion Advance (as defined in the Agreement for Lease) is to be made, the
Lessor shall execute within five (5) days of receipt of such Certificate of
Increased Cost from the Lessee a revised AFL Unit Leasing Record to amend the
Adjusted Acquisition Cost for such Parcel to reflect the increase in the
Acquisition Cost.
SECTION 4. OPERATING LEASE.
It is the intent of the Lessee and the Lessor that: (i) this
Lease constitutes an operating lease between the Lessor, as lessor, and the
Lessee, as lessee, for purposes of the Lessee's financial reporting, (ii)
notwithstanding any of the provisions of this Lease, the Agreement for Lease or
the other Transaction Documents to the contrary, the Lessee is and will be the
owner of the Property and Equipment for federal and state income tax purposes,
and (iii) this Lease grants to the Lessor a Lien on all of Lessee's right,
title and interest on and to the Property and Equipment. The Lessee and the
Lessor agree that the Lessor shall be deemed to have a valid and binding
security interest in and Lien on all of the Lessee's right, title and interest
in and to the Property and Equipment, free and clear of all Liens, other than
Permitted Liens, as security for the obligations of the Lessee under this Lease
and the Agreement for Lease (it being understood and agreed that in order to
secure the payment and performance of the obligations of the Lessee under this
Lease and the Agreement for Lease, the Lessee does hereby ▇▇▇▇▇ ▇ ▇▇▇▇ on, and
convey, transfer, assign, mortgage and warrant to the Lessor and its
successors, transferees and assigns as collateral security, for the benefit of
the Lessor and its successors, transferees and assigns, the Property and
Equipment and any proceeds or products thereof (subject to the Lessee retaining
the right, subject to the express provisions of this Lease and the Agreement
for Lease to remain in quiet and peaceful possession of each of the foregoing
and collect, receive and retain the rents, revenues, profits, proceeds, income
and royalties therefrom).
SECTION 5. DELIVERY.
(a) The Lessee shall acquire or order and accept Property
(other than Property or Equipment to be acquired and built pursuant to the
Agreement for Lease) pursuant to the procedures provided by the Lessor. The
Lessor shall not be liable to the Lessee for any failure to obtain, or delay in
obtaining, any Property or Equipment or any delay in the delivery of title to
the Lessor or possession of the Property or Equipment to the Lessee.
(b) Upon acceptance for lease of a Parcel of Property (other
than Property acquired and built pursuant to the Agreement for Lease) or Unit
of Equipment (other than Equipment located on Property acquired and built
pursuant to the Agreement for Lease) by the Lessee and the Lessor and receipt
by the Lessor of:
(i) in the case of a Unit of Equipment, the vendor's
invoice or invoices and, if required by the Lessor,
a ▇▇▇▇ of sale, for such Unit of Equipment, and in
the case of a Parcel of Property, the executed
contract of sale and deed with respect to each fee
interest in such Parcel of Property (or with respect
to a leasehold interest in a Parcel of Property, the
executed Ground Lease), in accordance with such
amounts set forth in the Unit Leasing Record for
such Unit of Equipment or Parcel of Property,
together with such estoppel
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certificates, consents, recognition and attornment
agreements and confirmation of customary mortgagee
protection as are reasonably acceptable to the
Lessor;
(ii) invoices or other evidence
satisfactory to the Lessor for any amounts included
in the Acquisition Cost of such Parcel or Unit
payable to parties other than the vendor in
accordance with such amounts set forth in the Unit
Leasing Record for such Unit of Equipment or Parcel
of Property;
(iii) invoices or other evidence
satisfactory to the Lessor for any amounts included
in the Acquisition Cost of such Parcel or Unit that
have been paid to the vendor or other parties by the
Lessee and for any costs included in the Acquisition
Cost of such Parcel or Unit incurred by the Lessee,
in accordance with such amounts set forth in the
Unit Leasing Record for such Unit of Equipment or
Parcel of Property;
(iv) with respect to each Parcel of
Property or Unit of Equipment, a current MAI
appraisal prepared by an independent, licensed
appraiser and in form and substance acceptable to
the Lessor in all respects;
(v) with respect to each Parcel of
Property, an ALTA form title insurance commitment
from a title insurance company satisfactory to the
Lessor and any Assignee, subject to no title
exceptions or other matters other than those
approved by the Lessor and any Assignee, and
committing to insure the Lessor's and Assignee's
interest in such Parcel of Property upon delivery to
the title insurance company of the title and
financing documents to be recorded and the actual
issuance and prompt delivery of such policies to the
Lessor and the Assignee;
(vi) with respect to each Parcel of
Property, a current as-built survey by an
independent, licensed registered public land
surveyor, certified to the Lessor and any Assignee,
which survey shall show the following: (1) lot lines
of such Parcel shown in metes and bounds, and the
lines of streets abutting such Parcel and the width
thereof, (2) all access and other easements
appurtenant to or used in connection with such
Parcel, (3) all roadways, paths, driveways,
easements, set-backs, encroachments and overhanging
projections and similar encumbrances affecting such
Parcel, whether recorded, apparent from a physical
inspection of such Parcel, or otherwise known to the
surveyor, (4) any encroachments on any adjoining
property by the building structures and improvements
on such Parcel, and (5) if such Parcel is described
by reference to a filed map, a legend relating the
survey to such map, and a certification whether such
Parcel is located in a flood zone;
(vii) with respect to each Parcel of
Property, (1) an environmental certificate
substantially in the form of Exhibit H to the
Agreement for Lease, duly executed by the Lessee,
and (2) an environmental report certified to the
Lessor and any Assignee and satisfactory to the
Lessor and Assignee in all respects, prepared by a
reputable environmental consulting or environmental
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engineering firm acceptable to the Lessor and
Assignee which addresses the matters set forth on
Exhibit I to the Agreement for Lease;
(viii) a Unit Leasing Record with respect
to such Parcel or Unit duly prepared and executed by
the Lessee;
(ix) opinions of counsel for the Lessee, in
form and substance reasonably satisfactory to the
Lessor and any Assignee; and
(x) such other documentation as the Lessor
may reasonably require.
Upon receipt and approval of all documents required by the preceding
clauses, the Lessor shall (A) pay to such vendor the amount of the vendor's
invoice or invoices and/or contract of sale for such Parcel or Unit except to
the extent previously paid by the Lessee, (B) pay to such other parties such
amounts payable, except to the extent previously paid by the Lessee and (C)
reimburse or pay to the Lessee for such amounts paid to the vendor or other
parties by the Lessee, for such costs incurred by the Lessee and, if agreed
between the Lessor and the Lessee, for the appraised value of the Property or
Equipment; PROVIDED, HOWEVER, that in no event shall the sum of all payments
made pursuant to clauses (A), (B) and (C) above exceed the Acquisition Cost of
such Property or Equipment.
(c) The requirements for acceptance for lease hereunder of
the Property acquired and built pursuant to the Agreement for Lease shall be
the requirements set forth in the Agreement for Lease.
(d) This is a net Lease. The obligations of the Lessee to pay
all amounts payable pursuant to this Lease (including specifically and without
limitation amounts payable under Sections 7 and 11 hereof) shall be absolute
and unconditional under any and all circumstances of any character, and such
amounts shall be paid without notice, demand, defense, setoff, deduction or
counterclaim and without abatement, suspension, deferment, diminution or
reduction of any kind whatsoever, except as herein expressly otherwise
provided. The obligation of the Lessee to lease and pay Basic Rent for any and
all Property or Equipment accepted for use pursuant to this Lease is without
any warranty or representation, express or implied, as to any matter whatsoever
on the part of the Lessor or any Assignee or any Affiliate of either, or anyone
acting on behalf of any of them.
THE LESSEE HAS SELECTED AND SHALL SELECT ALL PROPERTY OR EQUIPMENT
ACQUIRED OR ORDERED ON THE BASIS OF ITS OWN JUDGMENT. NEITHER THE LESSOR NOR
ANY ASSIGNEE NOR ANY AFFILIATE OF EITHER, NOR ANYONE ACTING ON BEHALF OF ANY OF
THEM MAKES ANY REPRESENTATION OR WARRANTY OF ANY KIND WHATSOEVER, EXPRESS OR
IMPLIED, INCLUDING, WITHOUT LIMITATION, AS TO THE SAFETY, TITLE, CONDITION,
QUALITY, QUANTITY, FITNESS FOR USE, MERCHANTABILITY, CONFORMITY TO
SPECIFICATION, OR ANY OTHER CHARACTERISTIC, OF ANY PROPERTY OR EQUIPMENT, OR AS
TO WHETHER ANY PROPERTY OR EQUIPMENT OR THE OWNERSHIP, USE, OCCUPANCY OR
POSSESSION THEREOF COMPLIES WITH ANY LAWS, RULES, REGULATIONS OR REQUIREMENTS
OF ANY KIND.
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AS BETWEEN THE LESSEE AND THE LESSOR, ANY ASSIGNEE OR ANY INDEMNIFIED
PERSON, THE LESSEE ASSUMES ALL RISKS AND WAIVES ANY AND ALL DEFENSES, SET-OFFS,
DEDUCTIONS, COUNTERCLAIMS, OR OTHER RIGHTS, EXISTING OR FUTURE, AS TO THE
LESSEE'S OBLIGATION TO PAY BASIC RENT AND ALL OTHER AMOUNTS PAYABLE HEREUNDER,
INCLUDING, WITHOUT LIMITATION, ANY RELATING TO:
(A) THE SAFETY, TITLE, CONDITION, QUALITY, QUANTITY,
FITNESS FOR USE, MERCHANTABILITY, CONFORMITY TO
SPECIFICATION, OR ANY OTHER QUALITY OR CHARACTERISTIC OF ANY
PROPERTY OR EQUIPMENT, LATENT OR NOT;
(B) ANY SET-OFF, COUNTERCLAIM, RECOUPMENT,
ABATEMENT, DEFENSE OR OTHER RIGHT WHICH THE LESSEE MAY HAVE
AGAINST THE LESSOR, ANY ASSIGNEE OR ANY INDEMNIFIED PERSON
FOR ANY REASON WHATSOEVER ARISING OUT OF THIS OR ANY OTHER
TRANSACTION OR MATTER;
(C) ANY DEFECT IN TITLE OR OWNERSHIP OF PROPERTY OR
EQUIPMENT OR ANY TITLE ENCUMBRANCE NOW OR HEREAFTER EXISTING
WITH RESPECT TO THE PROPERTY OR EQUIPMENT;
(D) ANY FAILURE OR DELAY IN DELIVERY OR ANY LOSS,
THEFT OR DESTRUCTION OF, OR DAMAGE TO, ANY PROPERTY OR
EQUIPMENT, IN WHOLE OR IN PART, OR CESSATION OF THE USE OR
POSSESSION OF ANY PROPERTY OR EQUIPMENT BY THE LESSEE FOR ANY
REASON WHATSOEVER AND OF WHATEVER DURATION, OR ANY
CONDEMNATION, CONFISCATION, REQUISITION, SEIZURE, PURCHASE,
TAKING OR FORFEITURE OF ANY PROPERTY OR EQUIPMENT, IN WHOLE
OR IN PART;
(E) ANY INABILITY OR ILLEGALITY WITH RESPECT TO THE
USE, OWNERSHIP, OCCUPANCY OR POSSESSION OF THE PROPERTY OR
EQUIPMENT BY THE LESSEE;
(F) ANY INSOLVENCY, BANKRUPTCY, REORGANIZATION OR
SIMILAR PROCEEDING BY OR AGAINST THE LESSEE OR THE LESSOR OR
ANY ASSIGNEE;
(G) ANY FAILURE TO OBTAIN, OR EXPIRATION, SUSPENSION
OR OTHER TERMINATION OF, OR INTERRUPTION TO, ANY REQUIRED
LICENSES, PERMITS,
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CONSENTS, AUTHORIZATIONS, APPROVALS OR OTHER LEGAL
REQUIREMENTS;
(H) THE INVALIDITY OR UNENFORCEABILITY OF THIS LEASE
OR ANY OTHER INFIRMITY HEREIN OR ANY LACK OF POWER OR
AUTHORITY OF THE LESSOR OR THE LESSEE TO ENTER INTO THIS
CONTRACT;
(I) THE INVALIDITY OR UNENFORCEABILITY OF ANY ▇▇▇▇
OF SALE OF ANY PROPERTY OR EQUIPMENT EXECUTED IN CONNECTION
WITH THIS LEASE OR ANY OTHER INFIRMITY THEREIN OR LACK OF
POWER OR AUTHORITY OF ANY PARTY THERETO TO ENTER INTO SUCH
▇▇▇▇ OF SALE; OR
(J) ANY OTHER CIRCUMSTANCES OR HAPPENING WHATSOEVER,
WHETHER OR NOT SIMILAR TO ANY OF THE FOREGOING.
THE LESSEE HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW,
ANY AND ALL RIGHTS WHICH IT MAY NOW HAVE OR WHICH AT ANY TIME HEREAFTER MAY BE
CONFERRED UPON IT, BY STATUTE OR OTHERWISE, TO TERMINATE, CANCEL, QUIT, RESCIND
OR SURRENDER THIS LEASE EXCEPT IN ACCORDANCE WITH THE EXPRESS TERMS HEREOF.
Each payment of Basic Rent, Additional Rent and any other amount due hereunder
made by the Lessee shall be final, and the Lessee, without waiving any other
remedies it may have, will not seek or have any right to recover all or any
part of such payment from the Lessor or any Assignee for any reason whatsoever,
except as set forth in the second succeeding sentence. Notwithstanding anything
contained herein to the contrary, the making of payments under this Lease by
the Lessee shall not be deemed to be a waiver of any claim or claims that the
Lessee may assert against the Lessor or any other Person. The Lessor agrees to
repay the Lessee amounts paid to the Lessor to the extent such payments were in
error and are not required by any of the terms and provisions of this Lease.
(e) Notwithstanding any other provision contained in this Lease, it is
specifically understood and agreed that neither the Lessor nor any Assignee nor
any Affiliate of either, nor anyone acting on behalf of any of them makes any
warranties or representations or has any responsibility to disclose any
relevant information, nor, except as set forth in Section 22 of this Lease, has
the Lessor or any Assignee or any Affiliate of either, or anyone acting on
behalf of any of them made any covenants or undertakings, as to the accounting
treatment to be accorded the Lessee or as to the U.S. Federal or any state
income or any other tax consequences, if any, to the Lessee as a result of or
by virtue of the transactions contemplated by this Lease.
(f) In the event the title insurance policy insuring the Lessor's
interest in any Parcel of Property would not, in the absence of special
insurance by the Lessee, become effective until the date of recordation of the
deed or the Ground Lease, as applicable, then the Lessee shall
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furnish such indemnity to the title insurance company as it shall require in
order to insure the Lessor's interest in such Parcel of Property, effective as
of the date of the Effective Date.
SECTION 6. LEASE TERM.
(a) The Lease Term with respect to any Parcel of Property or
Unit of Equipment leased hereunder shall commence on the Effective Date set
forth in the Unit Leasing Record or the AFL Unit Leasing Record for such Parcel
of Property or Unit of Equipment and shall continue through the seventh
anniversary of the date of this Lease, unless terminated earlier pursuant to
Section 12, 13, 14, 15, 16, 19 or 29 hereof.
(b) Notwithstanding anything contained in this Section 6, the
provisions of Sections 10 and 11 hereof and paragraph (a) of Section 15 hereof
(if applicable) shall apply with respect to any Property or Equipment from the
time such Property or Equipment is ordered by the Lessee.
SECTION 7. RENT AND OTHER PAYMENTS.
(a) The Lessee hereby agrees to pay the Lessor (i) on each
Basic Rent Payment Date, in immediately available funds, as provided in
paragraph (e) of this Section 7, Basic Rent for the quarterly period (or part
thereof) ending on such Basic Rent Payment Date, with respect to each Parcel of
Property or Unit of Equipment; PROVIDED, that, if the Effective Date is on or
after the first Lease Rate Date with respect to such Parcel or Unit, Basic Rent
for the applicable partial quarterly period shall be payable on the next
succeeding Basic Rent Payment Date.
(b) The Lessor shall furnish to the Lessee on the 16th day of
the month in which each Basic Rent Payment Date occurs the weighted average
percentage cost per annum referred to in paragraph (a)(iii) of the definition
of "Basic Rent" in Section 1 hereof for such quarterly period, or, if such day
is not a Business Day, on the next succeeding Business Day (the "LEASE RATE
DATE"). Prior to each Basic Rent Payment Date the Lessor shall furnish the
Lessee with a summary of the calculations of Basic Rent payable on such Basic
Rent Payment Date.
(c) The Lessee hereby agrees to pay on demand all amounts
(other than Basic Rent) payable hereunder, including, without limitation, all
amounts payable to any Indemnified Person pursuant to Section 11 hereof.
(d) Without prejudice to the full exercise by the Lessor of
its rights under Sections 18 and 19 hereof, the Lessee shall pay to the Lessor
from time to time, on demand, as additional rent ("ADDITIONAL RENT") (i)
amounts required to reimburse the Lessor for its obligations, costs and
expenses (not previously included in Basic Rent or Acquisition Cost) incurred
in acquiring, financing (including equity financing and maintaining security
for and exercising remedies in connection with any such financing) and leasing
the Property or Equipment (including, without limitation, all obligations of
the Lessor under or in respect of any interest rate swap, cap, collar or other
financial hedging arrangement and any amounts payable by the Lessor under any
such arrangement to reduce the notional amount thereof by the amount of any
prepayment of any borrowing to which such interest rate swap, cap, collar or
other financial hedging arrangement relates), and (ii) to the extent legally
enforceable, an amount computed by multiplying (A) all sums not paid by the
Lessee to the Lessor as provided in this
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Lease on or before the date such payments are due, by (B) the decimal
equivalent of the percentage referred to in paragraph (a)(iii) of the
definition of "Basic Rent" as most recently furnished by the Lessor, and by (C)
a fraction having a numerator equal to the number of days in the period from
but excluding such due date to and including the date of payment thereof
(provided that, all full calendar months during such period shall be computed
on the basis of a 30-day month) and a denominator of 360, in each case except
to the extent that the amounts described in clause (i) or (ii) above are
included in the Acquisition Cost or have been paid by the Lessee pursuant to
the provisions of Section 11 hereof. The Lessee shall also pay to the Lessor on
demand an amount equal to any expenses incurred by the Lessor in collecting
such unpaid sums.
(e) Basic Rent and Additional Rent and any other amount
payable by the Lessee to the Lessor shall be paid such that immediately
available funds in the full amount due are available on the date due, to the
account of the Lessor at such bank, or to such account of such other Person at
such bank, or otherwise as the Lessor may from time to time designate.
(f) During the Lease Term of any Parcel of Property or Unit
of Equipment, the Lessor shall calculate, on each Lease Rate Date (except the
first Lease Rate Date hereunder), the difference, if any, between (i) the Basic
Rent paid by the Lessee for the previous quarterly period and (ii) an amount
equal to what the Basic Rent would have been for such quarterly period had the
Basic Rent been calculated using the weighted average percentage cost per annum
of the borrowings outstanding at any time (as specified in subparagraph
(a)(iii) of the definition of Basic Rent) during the previous quarterly period
(rather than during the applicable Computation Period); PROVIDED, that with
respect to the Basic Rent for the last quarter of the Lease Term, such
calculation shall occur on the last day of the Lease Term. On or about August
16, 2000, and thereafter on or about August 16 of each year, and on the last
day of the Lease Term, the Lessor shall furnish to the Lessee a calculation of
the aggregate difference between the amounts determined under clause (i) above
and the correlating amounts determined under clause (ii) above (the
"RECONCILIATION AMOUNT") for each quarterly period since the date of this Lease
or each quarterly period since the last time the Reconciliation Amount was
calculated, whichever is later. The Lessor and the Lessee agree that if the
Reconciliation Amount is a positive number, then such amount shall be credited
against the amount of Basic Rent that the Lessee is required to pay on the next
Basic Rent Payment Date (or Basic Rent Payment Dates, if such amount shall
exceed the amount of Basic Rent payable in the next succeeding quarter), and if
the Reconciliation Amount is a negative number, then such amount shall be
payable by the Lessee on the next Basic Rent Payment Date in addition to the
amount of Basic Rent due and payable on such Basic Rent Payment Date, except
that with respect to the Reconciliation Amount computed on the last day of the
Lease Term, such amount shall be paid by the Lessor to the Lessee (in the case
of a positive number) or by the Lessee to the Lessor (in the case of a negative
number) on the last day of the Lease Term. Any notices required by this
paragraph (f) which are furnished to the Lessee by the Lessor shall be
conclusive, absent manifest error, as to the contents thereof.
SECTION 8. RESTRICTED USE; COMPLIANCE WITH LAWS.
(a) So long as no Event of Default shall have occurred and be
continuing, the Lessee may use the Property or Equipment in the regular course
of its business for any lawful purpose. The Lessee will not do or permit any
act or thing which might materially impair, other
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than normal wear and tear arising out of the proper and normal use thereof, the
value or utility of any Parcel of Property or Unit of Equipment.
(b) The Lessee shall promptly and duly execute, deliver, file
and record, at the Lessee's expense, all such documents, statements, filings
and registrations, and take such further action, as the Lessor shall from time
to time reasonably request in order to establish, perfect and maintain the
Lessor's title to and interest in the Property or Equipment and any Assignee's
security interest in this Lease or any Property or Equipment as against the
Lessee or any third party in any applicable jurisdiction. The Lessee may, after
notice in writing to the Lessor and at the Lessee's own cost and expense,
change the place of principal location of any Equipment. Notwithstanding the
foregoing, no change of location shall be undertaken unless and until all Legal
Requirements shall have been met. At the reasonable request of the Lessor (but
no more often than once each year), the Lessee shall advise the Lessor in
writing where all Equipment leased hereunder as of such date is principally
located.
(c) The Lessee shall use every reasonable precaution to
prevent loss or damage to Property or Equipment and to prevent injury to third
persons or property of third persons. The Lessee shall cooperate fully with the
Lessor and all insurance companies providing insurance pursuant to Section 10
hereof in the investigation and defense of any claims or suits arising from the
ownership, operation or use of any Equipment or ownership, use, or occupancy of
any Property; PROVIDED, that nothing contained in this paragraph (c) shall be
construed as imposing on the Lessor any duty to investigate or defend any such
claims or suits. The Lessee shall comply and shall use diligent efforts to
cause all Persons using or operating Equipment or using or occupying Property
to comply with all Insurance Requirements and Legal Requirements applicable to
such Property or Equipment and to the acquiring, titling, registering, leasing,
insuring, using, occupying, operating and disposing of Property or Equipment,
and the licensing of operators thereof.
(d) The Lessor or any Assignee or any authorized
representative of either may upon reasonable notice (and without notice if an
Event of Default shall have occurred and be continuing) and during reasonable
business hours from time to time inspect Property or Equipment and deeds,
registration certificates, certificates of title and related documents covering
Property or Equipment wherever the same may be located, but neither the Lessor
nor any Assignee shall have any duty to make any such inspection.
(e) The Lessee shall not, without the prior written consent
of the Lessor, permit, or suffer to exist, any Lien, other than Permitted Liens
or those Liens placed thereon by, or arising from, the Lessor's own actions or
which are subject to a Permitted Contest, nor may it assign any right or
interest herein or in any Property or Equipment. The Lessee shall not, without
the prior written consent of the Lessor, which consent shall not be
unreasonably withheld or denied, sublease or otherwise relinquish possession of
any Property or Equipment, except that (i) the Lessee may relinquish possession
of Property or Equipment to any contractor for use in performing work for the
Lessee on such Property or Equipment; PROVIDED, that such relinquishment of
possession shall in no way affect the obligations of the Lessee or the rights
of the Lessor hereunder and with respect to the Property or Equipment and (ii)
the Lessee may sublease any Parcel of Property or Unit of Equipment; PROVIDED,
that (A) each such sublease shall expressly be made subject and subordinate to
the provisions hereof, (B) no such sublease
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shall modify or limit any right or power of the Lessor or Assignee hereunder or
affect or reduce any obligation of the Lessee hereunder, and all such
obligations shall continue in full force and effect as obligations of a
principal and not of a guarantor or surety, as though no such subletting had
been made, and (C) any such sublease made otherwise than as expressly permitted
by this paragraph (e) shall be void and of no force and effect. Notwithstanding
the foregoing, upon the Lessee's written request, the Lessor shall enter into a
Recognition and Attornment Agreement with any subtenant of the Lessee which
subleases space representing at least 1,000 square feet of the total area of
any Parcel of Property, provided that at the time of such written request from
the Lessee, such subtenant is requesting or has requested that the Lessor enter
into such agreement. As security to the Lessor for the performance of the
Lessee's obligations under this Lease, the Lessee hereby assigns to the Lessor
all of its right, title and interest in and to all subleases permitted hereby
and, subject to the preceding sentence, agrees to use reasonable efforts to
cause any sublessee to enter into attornment agreements with the Lessor as the
Lessor shall reasonably request. The Lessor shall have the present and
continuing right to collect and enjoy all rents and other sums of money payable
under any such sublease, and the Lessee hereby irrevocably assigns such rents
and other sums to the Lessor for the benefit and protection of the Lessor;
PROVIDED, that unless an Event of Default shall have occurred and be continuing
hereunder, the Lessee shall be entitled to collect and enjoy such rents and
other sums. The Lessee shall, within thirty (30) days after the execution of
any such sublease, deliver a conformed copy thereof to the Lessor and any
Assignee. Nothing contained in this Lease shall be construed as constituting
the consent or request of the Lessor, express or implied, to or for the
performance by any contractor, laborer, materialman or vendor of any labor or
services or for the furnishing of any materials for any construction,
alteration, addition, repair or demolition of or to such Property or Equipment
or any part thereof. Notice is hereby given that the Lessor will not be liable
for any labor, services or materials furnished or to be furnished to the
Lessee, or to anyone holding any such Property or Equipment or any part thereof
through or under the Lessee, and that no mechanics' or other liens for any such
labor, services or materials shall attach to or affect the interest of the
Lessor in and to such Property or Equipment.
(f) If any Lien or charge of any kind or any judgment, decree
or order of any court or other governmental authority (including, without
limitation, any state or local tax lien affecting such Property or Equipment),
whether or not valid, shall be asserted or entered which might interfere with
the due and timely payment of any sum payable or the exercise of any of the
rights or the performance of any of the duties or responsibilities under this
Lease, the Lessee shall, upon obtaining knowledge thereof or upon receipt of
notice to that effect from the Lessor, promptly take such action as may be
necessary to prevent or terminate such interference.
SECTION 9. MAINTENANCE, IMPROVEMENT AND REPAIR OF PROPERTY OR
EQUIPMENT.
(a) Upon the request of the Lessee, the Lessor will, so long
as no Event of Default shall have occurred and be continuing, assign or
otherwise make available to the Lessee any and all rights the Lessor may have
under any vendor's or manufacturer's warranties or undertakings with respect to
any Property or Equipment.
(b) The Lessee shall pay all costs, expenses, fees and
charges (including, without limitation, charges of any community or property
owner to which any Parcel of Property
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is subject) incurred in connection with the ownership, use or occupancy of any
Parcel of Property or ownership, use and operation of any Unit of Equipment.
The Lessee shall operate and maintain the Property and Equipment in accordance
with prudent industry standards and in a manner reasonably consistent with that
of similar property and equipment owned and operated by the Lessee. Except as
otherwise provided in Section 15 hereof, the Lessee shall at all times, at its
own expense, and subject to reasonable wear and tear, keep the Property and
Equipment in good operating order, repair, condition and appearance. The
foregoing undertaking to maintain the Property and Equipment in good repair
shall apply regardless of the cause necessitating repair and regardless of
whether the Lessee has possession of the Property or Equipment, and as between
the Lessor and the Lessee all risks of damage to Property or Equipment are
assumed by the Lessee. With respect to any Parcel of Property, the undertaking
to maintain in good repair shall include, without limitation, all interior and
exterior repairs, whether structural or nonstructural, foreseen or unforeseen,
ordinary or extraordinary and all common area maintenance including, without
limitation, removal of dirt, snow, ice, rubbish and other obstructions and
maintenance of sidewalks and landscaping. The Lessee hereby agrees to indemnify
and hold the Lessor and any Assignee harmless from and against all costs,
expenses, claims, losses, damages, fines or penalties, including reasonable
counsel fees, arising out of or due to the Lessee's failure to fulfill its
obligations under this paragraph (b). Notwithstanding any other provisions of
this Lease to the contrary, neither the Lessor nor any Assignee shall have any
duty to maintain or repair any Property or Equipment or (except as otherwise
provided in the Agreement for Lease) to make any payments whatsoever in
connection with any maintenance, alteration or repair of any Property or
Equipment, and the Lessee acknowledges that neither the Lessor nor any Assignee
shall have any duty to make any such maintenance, alteration or repair.
(c) With respect to any Parcel of Property, the Lessee shall
pay: (i) all taxes, assessments, levies, fees, water and sewer rents and
charges, and all other governmental charges, general and special, ordinary and
extraordinary, foreseen and unforeseen, which are, at any time, imposed or
levied upon or assessed against (A) the Parcel, (B) any Basic Rent, any
Additional Rent or other sum payable hereunder or (C) this Lease, the leasehold
estate hereby created, or which arises in respect of the ownership, operation,
occupancy, possession or use of the Parcel; (ii) all gross receipts or similar
taxes (i.e., taxes based upon gross income which fail to take into account all
customary deductions (e.g., ordinary operating expenses, depreciation and
interest) relating to the Parcel) imposed or levied upon, assessed against or
measured by any Basic Rent, or any Additional Rent or other sum payable
hereunder; (iii) all sales, value added, use and similar taxes at any time
levied, assessed or payable on account of the acquisition, leasing or use of
the Parcel; and (iv) all charges of utilities and communications services
serving the Parcel. Notwithstanding the foregoing, the Lessee shall not be
required to pay any franchise, estate, inheritance, transfer, income or similar
tax of the Lessor (other than any tax referred to in clause (ii) above) unless
(subject to the proviso clause of this sentence) such tax is imposed, levied or
assessed in substitution for any other tax, assessment, charge or levy which
the Lessee is required to pay pursuant to this paragraph (c); PROVIDED,
HOWEVER, that if at any time during the term of this Lease, the method of
taxation shall be such that there shall be levied, assessed or imposed on the
Lessor a capital levy or other tax directly on the rents received therefrom, or
upon the value of any Parcel or any present or any future improvement or
improvements on any Parcel, then all such taxes, assessments, levies or charges
or the part thereof so measured or based, shall be payable by the Lessee, but
only to the extent that such taxes would be payable if the Property affected
were the only property of the Lessor, and the Lessee shall pay and
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discharge the same as herein provided. The Lessee will furnish to the Lessor,
promptly after demand therefor, proof of payment of all items referred to above
which are payable by the Lessee. If any such assessments may legally be paid in
installments, the Lessee may pay such assessment in installments. The Lessee
will pay and discharge, or cause to be paid and discharged, all taxes,
assessments and governmental charges or levies imposed upon it or its income or
properties, prior to the date on which penalties attach thereto, except to the
extent that any such tax, assessment, governmental charge or levy is the
subject of a Permitted Contest.
(d) So long as no Event of Default shall have occurred and be
continuing, the Lessee may, at its expense, make or permit alterations to any
Unit of Equipment; PROVIDED, that upon completion of such alterations (other
than any such alterations that are required by Legal Requirements) (i) such
alterations, individually or in the aggregate, would not materially lessen or
diminish the fair market value, utility or condition of such Unit of Equipment
below the value, utility or condition thereof immediately prior to such action
(assuming such Unit of Equipment was then of a condition and repair required to
be maintained pursuant to paragraph (b) of Section 9 hereof), (ii) such
alterations shall not result in such Unit of Equipment being used in any manner
other than a Primary Use or any other use incidental to, and not inconsistent
with, the Primary Use, (iii) such work shall be completed in a good and
workmanlike manner in accordance with generally accepted and prudent
engineering and construction practices and in compliance with all applicable
Legal Requirements and Insurance Requirements and (iv) the cost of any such
alteration shall not exceed $250,000 without the Lessor's and Assignee's prior
written consent, which consent shall not be unreasonably withheld. Any
improvements or additions to any Equipment shall become and remain the property
of the Lessor, except that any addition to Equipment made by the Lessee shall
remain the property of the Lessee if it can be removed from such Equipment
without impairing the functioning of such Equipment or its resale value,
excluding such addition. Any improvements or additions which do not remain
property of the Lessee shall be evidenced by a revised Unit Leasing Record.
(e) So long as no Event of Default shall have occurred and be
continuing, the Lessee may, at its sole expense, make or permit additions to
and alterations to any Parcel of Property; PROVIDED, that upon completion of
such additions or alterations (other than any such additions or alterations
that are required by Legal Requirements) (i) such additions or alterations,
individually or in the aggregate, would not materially lessen or diminish the
fair market value, utility or condition of such Parcel of Property below the
value, utility or condition thereof immediately prior to such action (assuming
such Parcel of Property was then of a condition and repair required to be
maintained pursuant to paragraph (b) of Section 9 hereof), (ii) such additions
or alterations shall not result in such Parcel of Property being used in any
manner other than a Primary Use and any other uses incidental to, and not
inconsistent with, the Primary Use, (iii) such work shall be completed in a
good and workmanlike manner in accordance with generally accepted and prudent
engineering and construction practices and in compliance with all applicable
Legal Requirements and Insurance Requirements and (iv) no exterior walls of any
building or other improvement constituting a part of a Parcel of Property shall
be demolished unless (A) the Lessee has made adequate provision according to
nationally recognized sound and prudent engineering and architectural standards
to preserve and maintain the structural integrity of the Parcel of Property and
for the restoration of such Parcel of Property to a structurally sound
architectural whole and (B) if such addition or alteration costs more than
$600,000, the obligations of the Lessee to preserve, maintain and restore are
reasonably assured to the Lessor's
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reasonable satisfaction. Any and all such additions and alterations shall be
and remain part of the Parcel of Property and shall be subject to this Lease.
Notwithstanding anything contained herein, the Lessee shall not perform any
addition or alteration to any Parcel of Property which would have an estimated
cost in excess of $250,000, without the Lessor's and Assignee's prior written
consent, which consent shall not be unreasonably withheld, and which consent
may be conditioned upon, among other things, the Lessor's and Assignee's
reasonable approval of the plans and specifications for such additions and
alterations.
(f) The Lessee agrees to use and operate all Travelstops as
travel centers, fuel stations, truck maintenance and repair centers or
convenience stores (collectively, the "PRIMARY USE"), shall not use or operate
any Travelstop for any other purpose other than for purposes incidental to, and
not inconsistent with, the Primary Use. The Lessee further agrees to maintain
at each Travelstop at all times the necessary Travelstop Equipment in such
condition so as to enable the Lessee to use and operate each Travelstop as a
travel center, fuel station, truck maintenance and repair center or convenience
store in the manner of and to standards equivalent to its customary and usual
business practices; PROVIDED, HOWEVER, that so long as no Event of Default
shall have occurred and be continuing, the Lessee shall be permitted to remove
any Travelstop Equipment from a Travelstop, at the Lessee's sole cost and
expense, for the purpose of repairing such Travelstop Equipment for the time
necessary to complete such repair. The Travelstop Equipment consisting of
underground fuel storage tanks and related piping (such tanks and piping being
collectively referred to as the "TANKS"), located at each Travelstop on the
Effective Date of each Travelstop shall be maintained, repaired, upgraded,
refurbished or replaced by the Lessee in accordance with applicable
Environmental Requirements and when necessary in order to ensure that all the
Tanks located at each Travelstop will include the Tanks listed on the AFL Unit
Leasing Record with respect to such Travelstop or replacements for such Tanks
of the kind, quality and in the quantities included in the AFL Unit Leasing
Record with respect to such Travelstop provided that the Lessee may replace
Tanks with tanks and piping of different kind, quality and in different
quantities if such replacement tanks and piping comply with Environmental
Requirements and will be in such condition so as to enable the Lessee to use
and operate each Travelstop as a travel center, fuel station, truck maintenance
and repair center or convenience store in the manner of and to standards
equivalent to its customary and usual business practices. As tanks and piping
are substituted at a Travelstop for Tanks subject to this Lease, title to such
substitute tanks and piping shall automatically be transferred to the Lessor
and such tanks and piping shall be subject to this Lease and title to the
existing Tanks for which such tanks and piping are being substituted shall be
automatically transferred by the Lessor to the Lessee in accordance with
paragraph (e) of Section 30 of this Lease.
(g) The Lessee shall not, directly or indirectly (a) create,
incur, assume or permit to exist any Lien (other than the Lien of the Pledge
Agreement) upon the Lessee's rights with respect to any Pledged Contract, or
sell or assign the Lessee's interest in any Pledged Contract, other than an
permitted pursuant to the Pledge Agreement, or (b) without the prior written
consent of the Lessor, terminate any Pledged Contract (other than as a result
of a default by a party other than the Lessee to such Pledged Contract) or
amend, modify, supplement, restate, replace, grant any consent under, or grant
or request any waiver pursuant to any Pledged Contract.
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(h) The Lessee shall give notice to the Lessor promptly upon
the receipt of any notices from any party to a Pledged Contract that (i) such
party is amending, modifying or waiving any term of any Pledged Contract, (ii)
such party is commencing or proposes to commence any dispute resolution
procedure under the terms of any Pledged Contract, (iii) such party is
terminating or has proposed to terminate any Pledged Contract, (iv) a default
has occurred under any Pledged Contract or any Person has alleged that a
default has occurred under any Pledged Contract, or (v) there are claims for
damages existing as a result of the performance or the failure to perform any
obligations under any Pledged Contract.
SECTION 10. INSURANCE.
(a) Commercial General Liability Insurance with Respect to
Equipment. The Lessee will carry at its own expense commercial general
liability insurance and property damage insurance with respect to all Equipment
(i) in amounts which are not less than the public liability and property damage
insurance applicable to similar equipment owned, leased or held by the
corporations engaged in the same or a similar business, similarly situated with
the Lessee; PROVIDED, that in no event shall such amounts be less than
$5,000,000 per occurrence, (ii) of the types usually carried by corporations
engaged in the same or a similar business, similarly situated with the Lessee,
and owning or operating similar equipment and which cover risk of the kind
customarily insured against by such corporations, and (iii) which are
maintained in effect with insurers of recognized responsibility reasonably
satisfactory to the Lessor. The insurance required by this paragraph (a) may be
maintained with a captive insurance company, may be obtained by the Lessee by
endorsement on its (or any Affiliate's) blanket insurance policies, may be
subject to reasonable deductibles and the Lessee may self-insure with respect
to the required coverage up to an aggregate amount of $250,000 or up to such
other higher amount as may be approved in writing by the Lessor.
(b) Insurance Against Loss or Damage to Equipment. The Lessee
will maintain in effect with insurers of recognized responsibility reasonably
satisfactory to the Lessor, at its own expense, physical damage insurance with
respect to all Equipment, which is of the type usually carried by corporations
engaged in the same or similar business, similarly situated with the Lessee,
and owning or operating similar equipment and which cover risk of the kind
customarily insured against by such corporations, and in substantially the
amount applicable to similar equipment owned, leased or held by the Lessee;
PROVIDED, that such insurance shall at all times be in an amount not less than
the aggregate Adjusted Acquisition Cost of all Equipment. The insurance
required by this paragraph (b) may be maintained with a captive insurance
company, may be obtained by the Lessee by endorsement on its (or any
Affiliate's) blanket insurance policies, may be subject to reasonable
deductibles and the Lessee may self-insure with respect to the required
coverage up to an aggregate amount of $250,000 or up to such other higher
amount as may be approved in writing by the Lessor.
(c) Insurance with Respect to Property. The Lessee will
maintain or cause to be maintained insurance of the following character, on
each Parcel of Property:
(i) All risk insurance coverage against losses by
fire and lightning and other risks for the full insurable
replacement value of each Parcel of Property, with agreed
amount endorsement or endorsements providing equivalent
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protection, including loss by windstorm, flood, hail,
explosion, riot (including riot attending a strike), civil
commotion, aircraft, vehicles, smoke damage, and vandalism
and malicious mischief, in amounts not less than the full
insurable replacement value of all buildings and other
improvements on each Parcel of Property, but in no event less
than the Adjusted Acquisition Cost of each Parcel of
Property. The term "full insurable replacement value" as used
herein means the actual replacement cost, including the costs
of debris removal, but excluding the cost of constructing
foundation and footings.
(ii) Comprehensive general public liability insurance
covering the legal liability of the Lessor and the Lessee
against claims for bodily injury, death or property damage,
occurring on, in or about each Parcel of Property or occurring
as a result of ownership of facilities located on each Parcel
of Property or as a result of the use of products or materials
manufactured, stored, processed, constructed or sold, or
services rendered, on each Parcel of Property, in the minimum
amount of $5,000,000 with respect to any one occurrence,
accident or disaster or incidence of negligence.
(iii) The Lessee shall comply with applicable workers'
compensation laws of the states where each Parcel of Property
is located, and shall maintain such insurance if and to the
extent necessary for such compliance.
(iv) Explosion insurance in respect of any boilers and
similar apparatus located on each Parcel in the minimum amount
of $250,000 or in such greater amounts as are then customary
for property similar in use to each Parcel.
(v) Such other insurance, in such amounts and against
such risks, as is customarily maintained by similarly situated
operators of similar properties for businesses similar to that
conducted by the Lessee.
The insurance required under this paragraph (c) shall be maintained in effect
with insurers of recognized responsibility reasonably satisfactory to the
Lessor. Such insurance may provide for such reasonable deductibles and the
Lessee may self-insure with respect to the required coverage up to an aggregate
amount of $250,000 or up to such other higher amount as may be approved in
writing by the Lessor. In addition, the insurance required by this paragraph
(c) may be maintained with a captive insurance company and may be obtained by
the Lessee by endorsement on its (or any Affiliate's) blanket insurance
policies.
Insurance claims by reason of damage or destruction to any Parcel of
Property shall be adjusted by the Lessee, subject to the approval of the Lessor
and Assignee in the case of claims in excess of $1,000,000, which approval the
Lessor and Assignee agree not to unreasonably withhold or delay; PROVIDED, that
if the amount claimed exceeds $1,000,000, the Lessor may participate in such
adjustment to the extent necessary in the Lessor's sole judgment to protect the
Lessor's interest in such Parcel of Property, at the Lessee's expense.
(d) Additional Insureds; Notice. Any policies of insurance carried in
accordance with this Section 10 and any policies taken out in substitution or
replacement for any
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THIS LEASE AGREEMENT IS
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such policies (i) shall name the Lessor, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇
Leasing, the General Partner and its shareholders, officers and directors, the
limited partners of the Lessor, and each Assignee as additional insureds, as
their respective interests may appear (but without imposing upon any such Person
any obligation imposed on the insured, including, without limitation, the
liability to pay the premium for any such policy), (ii) with respect to
insurance carried in accordance with the preceding paragraphs (b), (c)(i),
(c)(iv) and (c)(v) shall name the Assignee, if any, or the Lessor, if no
assignment has been made, as loss payee, (iii) with respect to insurance carried
in accordance with the preceding paragraphs (b) and (c), shall provide that as
against the Lessor the insurers shall waive any rights of subrogation, (iv)
shall provide that if the insurers cancel such insurance for any reason
whatsoever, or any substantial change is made in the coverage or the same is
allowed to lapse for nonpayment of premium or such insurance coverage is
reduced, such cancellation, change, lapse or reduction shall not be effective as
to the Lessor, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ Leasing, the General Partner and
its shareholders, officers and directors, the limited partners of the Lessor, or
any Assignee for thirty (30) days after receipt by the Lessor and Assignee, of
written notice by such insurers of such cancellation, change, lapse or
reduction, and (v) shall provide that in respect of the interest of the Lessor,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ Leasing, the General Partner and its
shareholders, officers and directors, the limited partners of the Lessor, and
each Assignee in such policies the insurance shall not be invalidated by any
action or inaction of the Lessee or any other Person (other than of the Lessor,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ Leasing, the General Partner and its
shareholders, officers and directors, the limited partners of the Lessor, or any
such Assignee in respect of its own interest) and shall insure the interests of
the Lessor, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ Leasing, the General Partner and its
shareholders, officers and directors, the limited partners of the Lessor, and
each such Assignee, as they appear, regardless of any breach or violation of any
warranties, declarations or conditions contained in such policies by the Lessee
or any other Person. Each liability policy (A) shall be primary without right of
contribution from any other insurance which is carried by the Lessor with
respect to its interest as such in the Property or Equipment and (B) shall
expressly provide that all of the provisions thereof, except the limits of
liability, shall operate in the same manner as if there were a separate policy
covering each insured.
(e) Application of Insurance Proceeds for Loss or Taking. As between
the Lessor and the Lessee it is agreed that any insurance payments received as
the result of the occurrence of (i) any event of loss described in paragraph (c)
of Section 15 hereof with respect to any Parcel of Property or Unit of
Equipment, or (ii) any event of Taking described in Section 16 hereof shall be
paid to an account of the Lessor and disposed of, as set forth in paragraph (c)
of Section 15 hereof.
(f) Application of Insurance Proceeds for Other than Loss or Taking. As
between the Lessor and the Lessee, so long as no Event of Default shall have
occurred and be continuing, insurance proceeds of any property damage loss to
any Property or Equipment will be held in an account of the Lessor and applied
in payment (or to reimburse the Lessee) for repairs or replacement in accordance
with the terms of this paragraph (f). The Lessee shall be entitled (i) to
receive the amounts so deposited against certificates, invoices or bills
reasonably satisfactory to the Lessor, delivered to the Lessor from time to time
as such work or repair progresses, and (ii) to direct the investment of the
amounts so deposited as provided in paragraph (g) of this Section 10. To the
extent that the Lessor reasonably estimates that the cost of such work or repair
shall exceed the amount of proceeds, the Lessee shall make adequate provisions
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for the payment thereof, which provisions shall be reasonably acceptable to the
Lessor. Any moneys remaining in the aforesaid account after final payment for
repairs has been made shall be paid to the Lessee.
(g) Investment. The Lessor, at the Lessee's instruction, may invest the
amounts deposited with the Lessor pursuant to paragraph (f) of this Section 10
in any investments permitted under a Credit Agreement. Such investments shall
mature in such amounts and on such dates so as to provide that amounts shall be
available on the draw dates sufficient to pay the amounts requested by and due
to the Lessee. Any interest earned on investments of such funds shall be paid to
the Lessee. The Lessor shall not be liable for any loss resulting from the
liquidation of each and every such investment and the Lessee shall bear the risk
of such loss, if any.
(h) Application in Default. Any amount referred to in paragraphs (d),
(e) or (f) of this Section 10 which is payable to the Lessee shall not be paid
to the Lessee or, if it has been previously paid to the Lessee, shall not be
retained by the Lessee, if at the time of such payment an Event of Default shall
have occurred and be continuing. In such event, all such amounts shall be paid
to and held by the Lessor as security for the obligations of the Lessee
hereunder or, at the Lessor's option, applied by the Lessor toward payment of
any of such obligations of the Lessee at the time due hereunder as the Lessor
may elect. At such time as there shall not be continuing any Event of Default,
all such amounts at the time held by the Lessor in excess of the amount, if any,
which the Lessor shall have elected to apply as above provided shall be paid to
the Lessee.
(i) Certificates, etc. On or before the execution of this Lease, on the
Effective Date with respect to any Parcel of Property or Unit of Equipment, and
annually on or before the anniversary of the date of this Lease, the Lessee will
furnish to the Lessor certificates or other evidence reasonably acceptable to
the Lessor certifying that the insurance then carried and maintained on each
Parcel of Property or Unit of Equipment complies with the terms hereof.
(j) Use or Operation of Property and Equipment. The Lessee covenants
that it will not use or operate any Equipment or use or occupy any Property or
permit the use or occupancy of any Property or the use or operation of any Unit
of Equipment at a time when the insurance required by this Section 10 is not in
force with respect to such Property or Equipment.
(k) Prosecution of Claims. The Lessee may, at its cost and expense,
prosecute any claim against any insurer or contest any settlement proposed by
any insurer, and the Lessee may bring any such prosecution or contest in the
name of the Lessor, the Lessee, or both, and the Lessor will join therein and
otherwise cooperate at the Lessee's request; PROVIDED, that the Lessee shall
indemnify the Lessor against any losses, costs or expenses (including reasonable
attorneys' fees) which the Lessor may incur in connection with such prosecution
or contest.
SECTION 11. INDEMNITIES.
The Lessee shall indemnify, defend, protect and hold harmless the
Lessor, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ Leasing, any Assignee, any successor or
successors, and any Affiliate of each of them, and their respective officers,
directors, incorporators, shareholders, partners (general and limited,
including, without limitation, the General Partner and the limited partners
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of the Lessor), employees, agents and servants (each of the foregoing an
"INDEMNIFIED PERSON") from and against all liabilities (including, without
limitation, Environmental Damages and strict liability in tort), taxes, losses,
obligations, claims (including, without limitation, Environmental Damages and
strict liability in tort), damages, penalties, causes of action, suits, costs
and expenses (including, without limitation, reasonable attorneys',
accountants', experts' and consultants' fees and expenses) or judgments of any
nature arising out of or relating to any events occurring or conditions or
circumstances existing prior to the expiration or earlier termination of this
Lease and relating to or in any way arising out of:
(a) The ordering, delivery, acquisition, purchase agreement for the
acquisition, construction, title on acquisition, rejection, installation,
possession, titling, retitling, registration, registration, custody by the
Lessee of title and registration documents, ownership, use, non-use, misuse,
lease under the Ground Lease, financing (including, without limitation, all
obligations of the Lessor under or in respect of any interest rate swap, cap,
collar or other financial hedging arrangement and any amounts payable by the
Lessor under any such arrangement to reduce the notional amount thereof by the
amount of any prepayment of any borrowing to which such interest rate swap, cap,
collar or other financial hedging arrangement relates), lease, sublease,
operation, transportation, repair or control of any Property or Equipment, or
Environmental Damages relating to or in any way arising out of any Property or
Equipment, including without limitation, Environmental Damages relating to or
arising out of Environmental Matters, Environmental Requirements, or the past,
present or future presence or the Release or threatened Release of Hazardous
Substances at, on, under, to or from, or the use, storage, handling, disposal
of, import, Release, remediation treatment, recycling, generation or
transportation of Hazardous Substances to or from, or the failure to report,
disclose or remediate the foregoing with respect to any Property, leased or to
be leased hereunder, (i) except to the extent that such costs are included in
the Adjusted Acquisition Cost of such Property or Equipment within the
limitations provided in paragraph (a)(v) of Section 3 hereof (or within any
change of such limitations agreed to in writing by the Lessor and the Lessee),
(ii) except for any internal administrative and overhead expenses of the Lessor
and (iii) except the income taxes with respect to which indemnification is
excluded under paragraph (c) of this Section 11;
(b) The assertion of any claim or demand based upon any infringement or
alleged infringement of any patent or other right, by or in respect of any
Property or Equipment; PROVIDED, HOWEVER, that the Lessor will make available to
the Lessee the Lessor's rights under any similar indemnification arising from
any manufacturer's or vendor's warranties or undertakings with respect to any
Property or Equipment;
(c) All U.S. Federal, state, county, municipal, foreign or other fees
and taxes of whatsoever nature, including but not limited to license,
qualification, franchise, withholding, sales, use, gross income, gross receipts,
ad valorem, business, personal property, real estate, value added, excise, motor
vehicle, occupation fees and stamp or other taxes or tolls of any nature
whatsoever, and penalties and interest thereon, whether assessed, levied against
or payable by the Lessor or otherwise, with respect to any Property or Equipment
or the acquisition, purchase, sale, rental, use, operation, control, ownership
or disposition of any Property or Equipment (including, without limitation, any
claim by any Governmental Authority for transfer tax, transfer gains tax,
mortgage recording tax, filing or other similar taxes or fees in connection with
the acquisition of any Property by the Lessor or otherwise in connection with
this Lease) or
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measured in any way by the value thereof or by the business of, investment in,
or ownership by the Lessor with respect thereto; PROVIDED, that this indemnity
shall not apply to Federal net income taxes, or to state and local net income
taxes, except that such indemnity shall apply to state and local net income
taxes (A) to the extent imposed by reason in whole or in part of (1) a relation
or asserted relation of any such taxing jurisdiction to the Property or
Equipment or to the transactions contemplated herein or (2) the actual or deemed
use by any Person of the Property or Equipment in such taxing jurisdiction,
other than in the case of both clauses (1) and (2), taxes to the extent such
taxes would have been imposed by a taxing jurisdiction because of a relationship
between the Lessor and such taxing jurisdiction without regard to the
circumstances described in clauses (1) and (2), and (B) to the extent imposed as
a result of the inability to claim, disallowance or other loss by TCA Network
Funding, Limited Partnership of deductions customarily allowed in computing net
income (e.g., interest expense, financing, administrative, ordinary operating
expenses and other fees and expenses); and PROVIDED further that this indemnity
shall not apply to taxes that, pursuant to the second sentence of paragraph (c)
of Section 9 hereof, are not the Lessee's responsibility to pay; or
(d) Any violation, or alleged violation by the Lessee, of this Lease or
of any contracts or agreements to which the Lessee is a party or by which it is
bound or of any laws, rules, regulations, orders, writs, injunctions, decrees,
consents, approvals, exemptions, authorizations, licenses and withholdings of
objection, of any governmental or public body or authority and all other Legal
Requirements.
The Lessee shall forthwith upon demand reimburse any Indemnified Person
for any sum or sums expended with respect to any of the foregoing or, upon
request from any Indemnified Person, shall pay such amounts directly. Any
payment made to or on behalf of any Indemnified Person pursuant to this Section
11 shall be increased to such amount as will, after taking into account all
taxes imposed with respect to the accrual or receipt of such payment (as the
same may be increased pursuant to this sentence), equal the amount of the
payment, reduced by the amount of any savings in such taxes actually realized by
the Indemnified Person as a result of the payment or accrual of the amounts in
respect of which the payment to or on behalf of the Indemnified Person hereunder
is made. To the extent that the Lessee in fact indemnifies any Indemnified
Person under the indemnity provisions of this Lease, the Lessee shall be
subrogated to such Indemnified Person's rights in the affected transaction and
shall have a right to determine the settlement of claims therein.
The indemnities contained in this Section 11 shall not be affected by
any termination of this Lease as a whole or in respect of any Parcel of
Property or Unit of Equipment leased hereunder or any failure or refusal of the
Lessee to accept any Property or Equipment acquired or ordered pursuant to the
terms hereof.
Although the foregoing is intended to expressly provide
indemnification for the negligence of Indemnified Persons, notwithstanding any
provisions of this Section 11 to the contrary, the Lessee shall not indemnify
and hold harmless any Indemnified Person against any claims and liabilities
arising from the gross negligence or bad faith of such Indemnified Person.
In the event the Lessor or any Indemnified Person shall be a party
defendant to any litigation arising out of any provision contained in this
Lease for which the Lessee has given
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indemnification, the Lessor or such other Indemnified Person shall give prompt
notice thereof to the Lessee by telephone and in writing and shall consult and
cooperate, at the Lessee's expenses with the Lessee, and if the Lessor shall not
have appeared or pleaded to any such action then the Lessor does hereby empower
any attorney of any court of record appointed by the Lessee (who shall give
prompt written notice to the Lessor of such appointment) to appear for the
Lessor and in good faith and with due diligence defend such action, to enter
counterclaims, to institute actions against third parties and to do all things
necessary or desirable in the judgment of such attorney after consultation with
the Lessor and the Lessee to preserve the rights of the Lessor and the Lessee,
all at the Lessee's own cost and expense. No failure or delay of the Lessor to
give the notice required by this Section 11 shall excuse the obligation of the
Lessee to indemnify the Lessor with respect to such litigation except to the
extent that any increase in liability is a direct result of such failure or
delay.
SECTION 12. LESSEE'S RIGHT OF PURCHASE.
(a) So long as no Event of Default has occurred and is continuing, the
Lessee shall have the right after January 9, 2002, upon not less than thirty
(30) days' written notice to the Lessor, to purchase any Parcel of Property or
Unit of Equipment under this Lease on the next Basic Rent Payment Date following
the expiration of such notice period during the Lease Term or any Renewal Term
for an amount equal to its Adjusted Acquisition Cost; PROVIDED, HOWEVER, that if
a Change of Control has occurred, the Lessee shall have the right at any time
during the term of this Lease, upon not less than thirty (30) days' written
notice to the Lessor, to purchase any Parcel of Property or Unit of Equipment
under this Lease on the next Basic Rent Payment Date following the expiration of
such notice period during the Lease Term or any Renewal Term for an amount equal
to its Adjusted Acquisition Cost; PROVIDED, FURTHER, that the Lessee shall be
entitled to purchase Travelstop Equipment pursuant to this paragraph (a) only in
conjunction with a purchase pursuant to this Section 12 of the Lessor's interest
in the Travelstop at which such Travelstop Equipment is used, or is to be used,
and conversely, the Lessee shall be entitled to purchase the Lessor's interest
in a Travelstop pursuant to this paragraph (a) only in conjunction with a
purchase pursuant to this Section 12 of the Travelstop Equipment used, or to be
used, at such Travelstop. In connection with, and as a condition to, any
purchase under this Section 12, on the Basic Rent Payment Date upon which such
purchase occurs, the Lessee shall pay to the Lessor (i) the Adjusted Acquisition
Cost of such Property or Equipment under this Lease, (ii) all Basic Rent due and
payable, (iii) any Additional Rent owing, (iv) all amounts payable pursuant to
Sections 11, 25 and 27 hereof, (v) all losses, damages, costs and expenses
(including, without limitation, reasonable attorneys' fees and expenses, filing
fees and sales or transfer taxes) sustained by the Lessor by reason of such
purchase (PROVIDED that, if the provisions set forth in this paragraph (a) are
applicable, such losses and damages shall not include any losses or damages for
foregone rent, lost profits or loss of the Lessor's benefit of the bargain
arising after the Lessee has paid in full all amounts due hereunder, has
purchased such Property or Equipment from the Lessor free and clear of all
Liens, and has otherwise performed all its obligations under this paragraph
(a)), and (vi) all other amounts owing hereunder. Upon receipt of such amounts,
the Lessor shall deliver to the Lessee a ▇▇▇▇ of sale and assignment agreement
assigning and conveying to the Lessee all of the Lessor's right, title and
interest in and to such Unit of Equipment and shall execute and deliver to the
Lessee a quitclaim deed or an assignment of any Ground Lease related to such
Parcel of Property. When the Lessor transfers title, such transfer shall be on
an as-is, non-installment sale basis, without warranty by, or
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recourse to, the Lessor, except that such title shall be free of any Liens
resulting from the Lessor's willful or knowing act or omission.
(b) Upon the occurrence of an Event of Default and upon the written
request of the Lessee, which shall be received no later than thirty (30)
Business Days subsequent to receipt of notice from the Lessor or any Assignee
pursuant to this Lease that an Event of Default has occurred, the Lessee shall
have the right, not later than thirty (30) Business Days after the Lessor's
receipt of such request, to purchase any Parcel of Property or Unit of Equipment
under this Lease at a price equal to its Adjusted Acquisition Cost; PROVIDED,
that the Lessee shall be entitled to purchase Travelstop Equipment pursuant to
this paragraph (b) only in conjunction with a purchase pursuant to this
paragraph (b) of the Lessor's interest in the Travelstop at which such
Travelstop Equipment is used, or is to be used, and conversely, the Lessee shall
be entitled to purchase the Lessor's interest in a Travelstop pursuant to this
paragraph (b) only in conjunction with a purchase pursuant to this paragraph (b)
of the Travelstop Equipment used, or to be used, at such Travelstop. In
connection with, and as a condition to, the purchase of the Property and
Equipment pursuant hereto, (i) the Lessee shall pay at the time of purchase, in
addition to the purchase price, (A) all Basic Rent due and payable, (B) any
Additional Rent owing, (C) all amounts payable pursuant to Sections 11, 25 and
27 hereof, (D) all losses, damages, costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses, filing fees and sales or
transfer taxes), sustained by the Lessor by reason of such purchase, (PROVIDED
that, if the provisions set forth in this paragraph (b) are applicable, such
losses and damages shall not include any losses or damages for foregone rent,
lost profits or loss of the Lessor's benefit of the bargain arising after the
Lessee has paid in full all amounts due hereunder, has purchased such Property
or Equipment from the Lessor free and clear of all Liens, and has otherwise
performed all its obligations under this paragraph (b)), and (E) all other
amounts owing by the Lessee hereunder as of the date of termination, including,
without limitation, all Accrued Default Obligations. Upon receipt of such
amounts, the Lessor shall deliver to the Lessee a ▇▇▇▇ of sale and assignment
agreement assigning and conveying to the Lessee all of the Lessor's right, title
and interest in and to such Unit of Equipment and shall execute and deliver to
the Lessee a quitclaim deed or an assignment of any Ground Lease related to such
Parcel of Property. When the Lessor transfers title, such transfer shall be on
an as-is, non-installment sale basis, without warranty by, or recourse to, the
Lessor, except that such title shall be free of any Liens resulting from the
Lessor's willful or knowing act or omission.
(c) The Lessee shall have the right, upon fifteen (15) days' notice to
the Lessor, to terminate the lease of any portion of any Parcel of Property
constituting undeveloped land acquired pursuant to this Lease or the Agreement
for Lease (the "UNDEVELOPED PROPERTY"), at any time during the Lease Term or any
Renewal Term, by arranging, at its own cost and expense, for the sale of such
Undeveloped Property in an arms' length transaction on the date of termination
and the receipt by the Lessor of the proceeds of such sale; PROVIDED, that as a
condition to any such sale (i) the Lessee shall determine, in its reasonable
business judgment, that such Undeveloped Property shall not be necessary for the
use, maintenance or operation of any Travelstop, and (ii) the Lessee shall
provide to the Lessor, upon the Lessor's request, evidence reasonably
satisfactory to the Lessor that such sale will not materially impair the value,
utility or condition of any Travelstop. The proceeds of any sale pursuant to
this paragraph (c) shall be remitted to and retained by the Lessor and the
Adjusted Acquisition Cost of such Parcel of Property shall be reduced by the
Lessor by the amount of such proceeds. Upon receipt by the
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Lessor of the proceeds of sale, the Lessor shall transfer title to such
Undeveloped Property to the purchaser at the sale designated by the Lessee. In
connection with any sale pursuant to this paragraph (c), (1) when the Lessor
transfers title, such transfer shall be on an as-is, non-installment sale basis,
without warranty by, or recourse to, the Lessor, but free of any Liens resulting
from the Lessor's willful or knowing act or omission, (2) the purchase price for
any such sale shall be paid entirely in cash and in immediately available funds
and (3) the Lessee shall pay or shall cause the purchaser to pay, in addition to
the purchase price, all mortgage recording taxes, if any, recording and filing
fees and all other similar taxes, fees, expenses and closing costs (including
reasonable attorneys' fees) in connection with the conveyance to any purchaser.
The Lessee hereby acknowledges and agrees that any sale by the Lessor of
Undeveloped Property pursuant to this paragraph (c) shall be subject to the
provisions of paragraph (d) of Section 7 and Section 11 of this Lease.
SECTION 13. LESSEE'S RIGHTS OF SURRENDER AND RENEWAL.
(a) So long as no Potential Default or Event of Default has occurred
and is continuing, the Lessee shall have the right, upon not less than two
hundred seventy (270) days' prior written notice to the Lessor and subject to
satisfaction of the Surrender Covenants set forth in paragraph (b) below, to
terminate this Lease and surrender the lease of any Parcel of Property or Unit
of Equipment under this Lease to the Lessor on a Surrender Date.
(b) In the event the Lessee provides the termination notice
contemplated in paragraph (a) above, the Lessee hereby covenants to the Lessor
(the "SURRENDER COVENANTS") as follows: (A) on the Surrender Date, (i) no Event
of Default or Potential Default shall have occurred and be continuing, (ii) the
Property and Equipment shall not be undergoing any repairs, additions or
alterations that could reasonably be expected to diminish the fair market value,
utility or remaining economic useful life which the Parcel or Unit would have
had at such time had such repair, addition or alteration not been undergoing
(assuming the Parcel or Unit is in the condition required hereby), and (iii)
each Parcel of Property and Unit of Equipment being surrendered shall be in
compliance with all Legal Requirements, (B) on or prior to the Surrender Date,
but in no event greater than ninety (90) days prior to the Surrender Date, the
Lessee shall, at its expense, deliver to the Lessor an environmental audit
satisfactory in scope and content to the Lessor and Assignee in their reasonable
discretion, to the effect that each such Parcel of Property and Unit of
Equipment being surrendered have been operated and maintained in compliance
with, and at the applicable time each Parcel and Unit is in compliance with, and
is not subject to any unperformed Remedial Actions with respect to,
Environmental Requirements, (C) on or prior to the Surrender Date, but in no
event greater than ninety (90) days prior to the Surrender Date, the Lessee
shall deliver to the Lessor and Assignee an appraisal from a nationally
recognized appraisal firm satisfactory to the Lessor and Assignee in their
reasonable discretion, to the effect that each such Parcel of Property and Unit
of Equipment has been maintained in accordance with the terms and conditions of
Section 9 of this Lease and prudent industry practices, (D) on the Surrender
Date, the Lessor shall have good and marketable title to each such Parcel of
Property and Unit of Equipment, free and clear of all Liens other than Permitted
Liens, and (E) on the Surrender Date, the Lessee shall provide evidence
satisfactory in the reasonable discretion of each of the Lessor and the Assignee
that the Lessor has all rights of way, easements, licenses, utilities,
Governmental Actions, permits, services, manuals, records
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and other information necessary to own, operate and maintain each such Parcel of
Property and Unit of Equipment from and after the termination of this Lease.
(c) In the event the Lessee has complied with each of the Surrender
Covenants, the Lessee shall, on the Surrender Date, terminate the lease of and
surrender such Parcel of Property or Unit of Equipment to the Lessor and pay to
the Lessor the Residual Amount and all other amounts owing by the Lessee
hereunder. In the event the Lessee has failed to comply with any of the
Surrender Covenants, the Lessee shall not be permitted on the Surrender Date to
terminate this Lease and surrender such Property and Equipment under this Lease
to the Lessor. Upon such surrender, the Lessor shall assume control of such
Property and Equipment, subject to the provisions of this paragraph (c), the
Lessor or Assignee (acting on behalf of the Lessor) shall have the right to sell
such Property and Equipment to a third party and the Lessee shall have no
further right, claim or interest in such Property and Equipment (except as set
forth in the immediately following sentence) (it being understood that the
Lessor shall be entitled to commence the marketing of such Property and
Equipment at any time subsequent to the first day of the sixth month prior to
the Surrender Date, and the Lessee agrees that it shall cooperate in connection
therewith). The proceeds of sale received by the Lessor or Assignee, as the case
may be, from any sale of such Property and Equipment shall be retained by the
Lessor or Assignee, as the case may be, PROVIDED that if the proceeds of sale
exceed the sum of (x) Adjusted Acquisition Cost of such Property and Equipment
less the Residual Amount of such Property and Equipment, and (y) all other
amounts owing by the Lessee hereunder, including, without limitation, (i) all
Basic Rent due and payable, (ii) any Additional Rent owing, (iii) all amounts
payable pursuant to Sections 11, 25 and 27 hereof, (iv) all losses, damages,
costs and expenses (including, without limitation, reasonable attorneys' fees
and expenses, filing fees and sales or transfer taxes) sustained by the Lessor
by reason of such sale, and (v) all other amounts owing hereunder, such excess
shall be paid by the Lessor or Assignee, as the case may be, to the Lessee (or,
if such sale occurs on the Surrender Date, such excess shall reduce the Residual
Amount owing by the Lessee pursuant to the first sentence of this paragraph by
the amount of such excess). The Lessee shall use reasonable efforts commencing
six (6) months prior to the Surrender Date to seek on behalf of the Lessor bona
fide arm's-length bids for the Property and Equipment from prospective
purchasers who are financially capable of purchasing the Property and Equipment
for cash, on an as-is, non-installment sale basis, without warranty by, or
recourse to, the Lessor. The Lessee shall notify the Lessor of the amount of
each such bid, and the name and address of the Person submitting such bid. In
its notice given pursuant to the immediately preceding sentence, the Lessee
shall advise the Lessor if the bid provided for in such notice will result in
the payment of Adjusted Acquisition Cost of such Property and Equipment by the
proposed purchaser on the Surrender Date. If the Lessee advises the Lessor that
such payment of Adjusted Acquisition Cost will be applicable, the Lessor shall
arrange for such sale to be made to such purchaser designated by the Lessee, if
such purchaser will pay an amount equal to the Adjusted Acquisition Cost of such
Property and Equipment on the Surrender Date; provided, that the Lessor shall
only be obligated to sell Travelstop Equipment to such purchaser in conjunction
with a sale of the Travelstop at which such Travelstop Equipment is used, or is
to be used, and conversely, the Lessor shall only be obligated to sell a
Travelstop to a purchaser in conjunction with a sale of the Travelstop Equipment
used, or to be used, at such Travelstop.
(d) In the event the Lessee shall surrender any Parcel of Property or
Unit of Equipment to the Lessor or to a purchaser of any Parcel of Property or
Unit of Equipment from
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the Lessor pursuant to the provisions of this Section 13, on the Surrender Date,
the Lessee shall pay to the Lessor (i) all Basic Rent due and payable and
accrued through the Surrender Date, (ii) any Additional Rent owing, (iii) all
amounts payable pursuant to Sections 11, 25 and 27 hereof, (iv) all losses,
damages, costs and expenses (including, without limitation, reasonable
attorneys' fees and expenses, filing fees and sales or transfer taxes) sustained
by the Lessor by reason of such surrender, and (v) any other amounts owing
hereunder as of the Surrender Date. Upon payment by the Lessee to the Lessor of
all amounts owing under this Section 13 and delivery of the Property and
Equipment to the Lessor or such purchaser, this Lease shall terminate, except to
the extent otherwise provided in this Lease. In addition, the Lessor may require
the Lessee to assign to the Lessor (or to a purchaser designated by the Lessor
or Assignee), at no cost, all right, title and interest of the Lessee in, to and
under the Pledged Contracts, and in the event any additional consent of any
party to a Pledged Contract is required as a precondition thereunder to an
assignment to any other third party assignee designated by the Lessor or
Assignee, to use diligent efforts to obtain any such required consent to such
proposed assignment and assumption of the Pledged Contracts.
(e) Provided that no Event of Default has occurred and is continuing as
at the date of such request, if the Lessee shall, not earlier than 450 days and
not later than six (6) months prior to the last day of the Lease Term, request
in writing that the Lessor obtain bank borrowings on terms reasonably acceptable
to it and the Lessee in order to finance the Lessor's ownership of any Parcel of
Property or Unit of Equipment for a renewal term to be agreed upon between the
Lessee and the Lessor (the "RENEWAL TERM"), commencing on the first day of the
calendar month following the last day of the Lease Term, at the fair market
value rental, the Lessor shall make reasonable efforts to arrange for bank
commitments to provide such financing. The Lessor will notify the Lessee of all
bona fide offers of refinancing that the Lessor deems reasonable and advise the
Lessee in writing not later than sixty (60) days prior to the last day of the
Lease Term as to whether it has been able to obtain bank commitments on terms
and conditions reasonably acceptable to it to finance such Property or Equipment
for the Renewal Term. In such notice, the Lessor shall identify such terms and
conditions. In order to renew the lease of such Property or Equipment for the
Renewal Term, the Lessee must notify the Lessor in writing within ten (10) days
of its receipt of the foregoing notice of the Lessor, indicating (i) whether the
terms and conditions of such financing are acceptable to it and (ii) whether the
Lessee agrees to lease such Property or Equipment for the Renewal Term. The
notice of the Lessee contemplated by the preceding sentence (i) shall be
irrevocable and (ii) shall supercede any notice of termination and surrender
delivered to the Lessor with respect to such Property or Equipment pursuant to
paragraph (a) of this Section 13. The Lessor shall schedule the closing of the
financing contemplated by the bank commitments on or before the date which is
one (1) month prior to the end of the Lease Term. The Lessor shall notify the
Lessee in writing promptly of the closing of such financing or that such
financing shall have failed to close on such scheduled date. At such closing the
Lessee and the Lessor shall agree that such Property or Equipment shall, subject
to the terms and conditions of this Lease, be leased hereunder for the Renewal
Term. If the closing shall not occur on or before the date which is one (1)
month prior to the last day of the Lease Term, then the lease of such Property
and Equipment shall terminate on the last day of the Lease Term.
(f) The fair market value rental of any Parcel of Property or Unit of
Equipment for purposes of paragraph (e) of this Section 13 shall be as agreed
upon by the Lessor and the
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Lessee or, if they are unable to agree, at an amount of Basic Rent determined
pursuant to the Appraisal Procedure.
SECTION 14. TERMINATION UPON CERTAIN EVENTS.
(a) Notwithstanding any other provisions of this Lease or the Agreement
for Lease, this Lease shall terminate with respect to any Parcel of Property and
Unit of Equipment subject to any Termination Event described below and the
Lessee shall be required to purchase such Parcel of Property and Unit of
Equipment from the Lessor upon the happening of the following event during the
term of this Lease with respect to such Parcel of Property and Unit of Equipment
and the Lessor's written notice to the Lessee of the Lessor's election to
terminate this Lease with respect to such Parcel of Property and Unit of
Equipment (a "TERMINATION EVENT"): the occurrence of any event or circumstance
relating to Environmental Matters, Environmental Damages or Environmental
Requirements with respect to any Parcel of Property and Unit of Equipment that
could reasonably be expected to have a material adverse effect on (i) the
operation, maintenance, leasing, ownership, use or value of any Parcel of
Property and Unit of Equipment, (ii) the ability of the Lessee to perform its
obligations under this Lease or the Agreement for Lease in a timely manner, or
(iii) the rights or interests of the Lessor or Assignee under this Lease or the
Agreement for Lease.
(b) Upon the occurrence of a Termination Event, the Lessee shall be
obligated on the next Basic Rent Payment Date to purchase the affected Parcel of
Property and Unit of Equipment for an amount equal to its Adjusted Acquisition
Cost; PROVIDED, that the Lessee shall be obligated to purchase Travelstop
Equipment pursuant to this paragraph (b) in conjunction with a purchase pursuant
to this paragraph (b) of the Lessor's interest in the Travelstop at which such
Travelstop Equipment is used, or is to be used, and conversely, the Lessee shall
be obligated to purchase the Lessor's interest in a Travelstop pursuant to this
paragraph (b) in connection with a purchase pursuant to this paragraph (b) of
the Travelstop Equipment used, or to be used, at such Travelstop. In connection
with such purchase, on the Basic Rent Payment Date upon which such purchase
occurs, the Lessee shall pay to the Lessor (i) the Adjusted Acquisition Cost of
such Property and Equipment, (ii) all Basic Rent due and payable, (iii) any
Additional Rent owing, (iv) all amounts payable pursuant to Sections 11, 25 and
27 hereof, (v) all losses, damages, costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses, filing fees and sales or
transfer taxes) sustained by the Lessor by reason of such purchase (PROVIDED
that, if the provisions set forth in this paragraph (b) are applicable, such
losses and damages shall not include any losses or damages for foregone rent,
lost profits or loss of the Lessor's benefit of the bargain arising after the
Lessee has paid in full all amounts due hereunder, has purchased such Property
or Equipment from the Lessor free and clear of all Liens, and has otherwise
performed all its obligations under this paragraph (b)), and (vi) all other
amounts owing hereunder with respect to such Property or Equipment.
(c) If, at any time, in the good faith judgment of the Lessee, any
Travelstop Equipment shall have become obsolete, useless or uneconomic for
continued use and occupancy by the Lessee for its Primary Use (such Travelstop
Equipment hereinafter called "UNECONOMIC EQUIPMENT"), then the Lessee shall
deliver to the Lessor a written notice containing (A) notice of the Lessee's
intention to terminate the Lease as to such Uneconomic Equipment as of a Basic
Rent Payment Date specified in such notice, and (B) a certificate of a
Responsible Officer stating
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that the Lessee has determined that such Travelstop Equipment has become
obsolete, useless or uneconomic for continued use and occupancy by the Lessee
for its Primary Use. The Lessee shall terminate this Lease with respect to such
Travelstop Equipment and shall (1) in the case of any Travelstop Equipment with
an Adjusted Acquisition Cost equal to or less than $100,000: (x) purchase such
Travelstop Equipment for one dollar, so long as the aggregate Acquisition Cost
of all such Travelstop Equipment does not exceed $250,000 per annum or
$1,000,000 during the term of this Lease and (y) where the aggregate Adjusted
Acquisition Cost of such Travelstop Equipment exceeds the amounts set forth in
clause (x) above, purchase such Travelstop Equipment at its Adjusted Acquisition
Cost or arrange, at its own cost and expense, to sell such Travelstop Equipment
to a third party purchaser in an arm's length transaction, for an amount equal
to its Adjusted Acquisition Cost, and (2) in the case of any Travelstop
Equipment with an Adjusted Acquisition Cost in excess of $100,000, purchase such
Travelstop Equipment at its Adjusted Acquisition Cost, on the Basic Rent Payment
Date specified in such notice. In connection with such purchase or sale (as the
case may be), on the Basic Rent Payment Date upon which such purchase or sale
occurs, the Lessee shall pay to the Lessor (i) the purchase price or sale price
(as the case may be) of such Uneconomic Equipment, (ii) all Basic Rent due and
payable, (iii) any Additional Rent owing, (iv) all amounts payable pursuant to
Sections 11, 25 and 27 hereof, (v) all losses, damages, costs and expenses
(including, without limitation, reasonable attorneys' fees and expenses, filing
fees and sales or transfer taxes) sustained by the Lessor by reason of such
purchase or sale (PROVIDED that, if the provisions set forth in this paragraph
(c) are applicable, such losses and damages shall not include any losses or
damages for foregone rent, lost profits or loss of the Lessor's benefit of the
bargain arising after the Lessee has paid in full all amounts due hereunder, has
purchased such Travelstop Equipment from the Lessor free and clear of all Liens,
and has otherwise performed all its obligations under this paragraph (c)), and
(vi) all other amounts owing hereunder with respect to such Uneconomic
Equipment.
SECTION 15. LOSS OF OR DAMAGE TO PROPERTY OR EQUIPMENT.
(a) The Lessee hereby assumes all risk of loss of or damage to Property
or Equipment, however caused. Except as expressly provided herein, no loss of or
damage to any Property or Equipment shall impair any obligation of the Lessee
under this Lease, which shall continue in full force and effect with respect to
any lost or damaged Property or Equipment.
(b) In the event of damage of any kind whatsoever to any Property or
Equipment (unless the same is determined to be damaged beyond repair) the
Lessee, at its own cost and expense, shall replace the same pursuant to the
requirements of clause (A) of paragraph (c) below or place the same in good
operating order, repair, condition and appearance. The Lessee's right to any
proceeds paid under any insurance policy or policies required under Section 10
of this Lease with respect to any such damage to any Property or Equipment is
governed by paragraph (f) of Section 10 hereof.
(c) If (i) any Property or Equipment is lost, stolen, destroyed,
seized, confiscated, rendered unfit for use or damaged beyond repair, (ii) the
use thereof by the Lessee in the ordinary course of business is prevented by the
act of any third Person or Persons or governmental instrumentality for a period
exceeding one hundred eighty (180) consecutive days, (iii) any such Property or
Equipment is attached (other than on a claim against the Lessor as to
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which the Lessee is not obligated to indemnify the Lessor) and the attachment is
not removed within sixty (60) consecutive days, or (iv) a Taking as described in
paragraph (a) of Section 16 hereof occurs, then in any such event, either (A)
the Lessee shall promptly replace such Property or Equipment with real property
or equipment of a similar like and kind, and of a value not less than the
Property or Equipment being replaced, and the Lessee and the Lessor shall
execute a revised Unit Leasing Record or AFL Unit Leasing Record, as the case
may be, to amend, among other things, the description of such Property or
Equipment, PROVIDED that the replacement of any Property with other real
property shall be subject to the prior written consent of the Lessor (which
consent shall not be unreasonably withheld), and to receipt by the Lessor and
Assignee of all documentation required with respect to the acquisition of
Property by the Lessor under the terms of the Agreement for Lease, this Lease
and the Credit Agreement, and provided further, that any insurance proceeds
relating to such Property or Equipment will be distributed in accordance with
paragraph (f) of Section 10 hereof, or (B) (i) the Lessee shall promptly notify
the Lessor in writing of such event, (ii) on a Basic Rent Payment Date within
one hundred eighty (180) days following such event, the Lessee shall pay to the
Lessor an amount equal to the Adjusted Acquisition Cost of such Property or
Equipment, (iii) the Lease Term or Renewal Term of the applicable Property and
Equipment shall continue until the Basic Rent Payment Date on which the Lessor
receives payment from the Lessee of the amount payable pursuant to this
paragraph (c) and of Basic Rent due and payable, any Additional Rent and other
amounts owing hereunder with respect to such Property or Equipment, and shall
thereupon terminate, and the lease of all other Property and Equipment shall
continue hereunder and (iv) the Lessor shall on such Basic Rent Payment Date
transfer title to such Property and Equipment to the Lessee, and the Lessee
shall be subrogated to the Lessor's rights resulting from such event. Insurance
and condemnation proceeds, if any, received by the Lessor in excess of the
Adjusted Acquisition Cost of the affected Property and Equipment, so long as no
Event of Default has occurred and is continuing, shall be paid by the Lessor to
the Lessee upon the payment by the Lessee of all amounts referred to in the
preceding sentence. If the lease of a Travelstop or Travelstop Equipment is
terminated pursuant to this paragraph (c), then the lease of both the affected
Travelstop and the Travelstop Equipment used, or to be used, at such Travelstop
shall be terminated in accordance with the terms of this paragraph (c).
SECTION 16. CONDEMNATION AND DEDICATION OF PROPERTY; EASEMENTS.
(a) If the use, occupancy or title to all or a substantial portion of a
Parcel of Property is taken, requisitioned or sold in, by or on account of
eminent domain proceedings or other action by any Person or authority having the
power of eminent domain (such events collectively referred to as a "TAKING"),
then the Lease Term or Renewal Term of such Parcel of Property and all Equipment
thereat shall terminate, as provided in paragraph (c) of Section 15 hereof. Upon
receipt of proceeds from any award or sale made in connection with such Taking,
if the Lessee has paid all amounts owing under paragraph (c) of Section 15
hereof, the Lessor shall remit to the Lessee the net amount of such proceeds
remaining after reimbursement for all costs and expenses (including, without
limitation, reasonable attorneys' fees) incurred by the Lessor in connection
with the negotiation and settlement of any proceedings related to such Taking. A
Taking shall be deemed to affect a "substantial portion" of a Unit if, after
such Taking, such Parcel of Property has suffered a material diminution in value
and is, or will be, unusable for the Lessee's ordinary business purposes.
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(b) If less than a substantial portion of a Parcel of Property is
subject to a Taking, then this Lease shall continue in effect as to the portion
of the Parcel not taken and, so long as no Event of Default has occurred and is
continuing, any net proceeds shall be paid to the Lessee.
(c) So long as no Event of Default hereunder has occurred and is
continuing, the Lessee shall have the right (i) to grant easements and enter
into covenants and restrictions for the benefit of any Parcel of Property or the
business thereat, (ii) to voluntarily dedicate or convey, as required, portions
of any Parcel of Property for road, highway and other public purposes, (iii) to
voluntarily execute petitions to have any Parcel of Property or a portion
thereof annexed to any municipality or included within any utility, highway or
other improvement or service district, provided that no more than minor
restoration is required and (iv) to contest on its own and the Lessor's behalf
any proposed Taking or the amount of any award in connection therewith. If any
monetary consideration is paid for such easement or dedication, the Lessee shall
be entitled to receive or retain such consideration.
The Lessee shall exercise the above power to grant without the joinder
of the Lessor, except that the Lessor will cooperate, without unreasonable
delay and at the Lessee's request and expense, as necessary and join in the
execution of any appropriate instrument or shall execute any separate
instrument as necessary. As a condition precedent to the Lessee's exercise of
any of the Lessee's powers under this Section 16, (i) the Lessee shall give the
Lessor five (5) Business Days' prior written notice of the proposed action and
(ii) the Lessee shall provide to the Lessor a certificate of the Lessee stating
that such action will not adversely affect either the fair market value of such
Property or the use of such Property for its intended purpose, will not affect
the Lessor's ability to exercise its rights and remedies under this Lease and
that the Lessee undertakes to remain obligated under this Lease to the same
extent as if the Lessee had not exercised its powers under this Section 16 and
the Lessee will perform all obligations under such instrument and shall prepare
all required documents and provide all other instruments and certificates as
the Lessor may reasonably request.
SECTION 17. SURRENDER OF PROPERTY OR EQUIPMENT.
(a) Subject to the provisions of Sections 12, 13, 14, 15, 16, 19 and 29
hereof, upon termination of the lease of any Property or Equipment hereunder,
the Lessee shall surrender such Property or Equipment to the Lessor. Equipment
shall be surrendered by delivering the same to the Lessor at such location as
the Lessor and the Lessee may agree and, if they are unable to agree, at such
location as the Lessor may reasonably direct. Such Property or Equipment shall
be surrendered in the condition required by paragraph (b) of Section 9 hereof.
(b) Upon the surrender of the Property and Equipment, the Lessee shall
deliver to the Lessor or its designee all non-proprietary logs, manuals,
inspection data, books and records or copies thereof and other information,
which are necessary to operate the Property and Equipment and which are in
accordance with applicable Legal Requirements or sound industry practice
customarily retained (or that the Lessee actually did retain) or are required by
Legal Requirements to be retained with respect to operations at the Property,
including, without limitation, all non-proprietary software and manuals
applicable to the Property or Equipment and all design plans, know-how, records
and information used by the Lessee and necessary for the
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non-proprietary operation of the Property or Equipment, and all non-proprietary
records relating to the operation of the Tanks.
SECTION 18. EVENTS OF DEFAULT.
Any of the following events of default shall constitute an "EVENT OF
DEFAULT" and shall give rise to the rights on the part of the Lessor described
in Section 19 hereof:
(a) Failure of the Lessee to pay amounts due to the Lessor at the time
of any scheduled sale of any Parcel of Property or Unit of Equipment hereunder,
failure of the Lessee to pay Basic Rent for more than five (5) Business Days
after such payment is due pursuant to Section 7 hereof, or failure of the Lessee
to pay any other amount payable by the Lessee hereunder within ten (10) Business
Days after written demand from the Lessor that such other payment is due; or
(b) Failure to maintain the insurance required by Section 10 hereof, or
default in the performance of the covenant contained in paragraph (j) of Section
10 hereof; or
(c) Default in the performance of any other obligation or covenant of
the Lessee pursuant to this Lease and, in the case of such default (other than a
default arising under paragraph (u) of Section 2 hereof), the continuance of
such default for thirty (30) days after written notice to the Lessee by the
Lessor specifying such default and requiring such default to be remedied;
PROVIDED, that if such default is of a nature that is not capable of being cured
within such thirty (30) day period and the Lessee shall have diligently
commenced curing such default and proceeds diligently and in good faith
thereafter to complete curing such default, such thirty (30) day period shall be
extended to such period as should be necessary to cure such default, not to
exceed one hundred twenty (120) days; or
(d) An involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i) relief
in respect of the Lessee or the Guarantor, or of a substantial part of the
property or assets of the Lessee or the Guarantor, under Title 11 of the United
States Code, as now constituted or hereafter amended, or any other Federal or
state bankruptcy, insolvency, receivership or similar law, (ii) the appointment
of a receiver, trustee, custodian, sequestrator, conservator or similar official
for the Lessee or the Guarantor or for a substantial part of the property or
assets of the Lessee or the Guarantor or (iii) the winding-up or liquidation of
the Lessee or the Guarantor and such proceeding or petition shall continue
undismissed for thirty (30) days or an order or decree approving or ordering any
of the foregoing shall be entered; or
(e) The Lessee or the Guarantor shall (i) voluntarily commence any
proceeding or file any petition seeking relief under Title 11 of the United
States Code, as now constituted or hereafter amended, or any other Federal or
state bankruptcy, insolvency, receivership or similar law, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner (but
within thirty (30) days in any event), any proceeding or the filing of any
petition described in paragraph (d) above, (iii) apply for or consent to the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Lessee or the Guarantor or for a substantial part of
the property or assets of the Lessee or the Guarantor, (iv) file an answer
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
admitting the material allegations of a petition filed against it in any such
proceeding, (v) make a general assignment for the benefit of creditors, (vi)
become unable, admit in writing its inability or fail generally to pay its debts
as they become due or (vii) take any action for the purpose of effecting any of
the foregoing; or
(f) A default or event of default, the effect of which is to permit the
holder or holders of any Indebtedness, or a trustee or agent on behalf of such
holder or holders, to cause such Indebtedness to become due prior to its stated
maturity, shall occur under the provisions of any agreement pursuant to which
such Indebtedness was created or instrument evidencing such Indebtedness of the
Lessee or the Guarantor in excess of $2,000,000 in the aggregate or any
obligation of the Lessee or the Guarantor for the payment of such Indebtedness
shall become or be declared to be due and payable prior to its stated maturity,
or shall not be paid when due; PROVIDED, that the provisions of this paragraph
(f) shall not be deemed to apply to any default or event of default or
obligation for the payment of Indebtedness arising solely as a result of a
reduction in the rating of the Guarantor's senior unsecured debt to less than
BBB by Standard & Poor's Ratings Group or less than Baa2 by ▇▇▇▇▇'▇ Investor
Service, Inc.; or
(g) Any representation or warranty made by the Lessee in this Lease or
any document contemplated hereby or thereby shall prove to have been false or
inaccurate in any material respect on or as of the date made or deemed made; or
(h) Any final non-appealable judgment or judgments for the payment of
money in excess of $2,000,000 in the aggregate shall be rendered against the
Lessee or the Guarantor by any court of competent jurisdiction and the same
shall remain undischarged for a period of sixty (60) days during which execution
of such judgment or judgments shall not be effectively stayed; or
(i) The Guarantor shall fail to own (directly or indirectly)
beneficially and of record fifty-one percent (51%) or more of all the common
stock of TA Operating Corporation or National Auto/Truckstops, Inc. (the
"Applicable Agent"), unless at the time the Guarantor also owns (directly or
indirectly) beneficially and of record less than 51% of the common stock of the
Lessee that is not the Applicable Agent; or
(j) An Event of Default (as defined in the Agreement for Lease) shall
occur under the Agreement for Lease; or
(k) The Pledge Agreement ceases to be in full force and effect, the
Lessee defaults in the performance of any obligation or covenant contained in
the Pledge Agreement, or the representation contained in the third sentence of
paragraph (q) of Section 2 hereof shall at any time become untrue in any
material respect; or
(l) Default in the performance of the covenant contained in paragraph
(v) of Section 2 hereof; or
(m) (i) The Guaranty ceases to be in full force and effect or (ii) the
Guarantor defaults in the performance of any obligation or covenant contained in
the Guaranty or any other document contemplated thereby, any required notice of
such default shall have been given, and any applicable grace period shall have
expired; or
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
(n) Any representation or warranty made by the Guarantor in the
Guaranty or any document contemplated hereby or thereby proves to be false,
misleading or inaccurate in any material respect.
SECTION 19. RIGHTS UPON DEFAULT.
Upon the occurrence and continuation of any Event of Default the
Lessor may do any one or more of the following:
(a) Terminate the lease of any or all Property or Equipment leased
hereunder by written notice to the Lessee;
(b) Whether or not the lease of any Property or Equipment is
terminated, take immediate possession of and remove any or all Equipment and
other equipment or property of the Lessor in the possession of the Lessee,
wherever situated, and for such purpose, enter upon any premises without
liability to the Lessee for so doing;
(c) Whether or not any action has been taken under paragraph (a) or (b)
above, take immediate possession of any Property or Equipment and sell or relet
any Property or Equipment (with or without the concurrence or request of the
Lessee); PROVIDED, HOWEVER, that notwithstanding any such reletting or taking of
possession, the Lessor may at any time thereafter elect to terminate this Lease
for a continuing Event of Default; PROVIDED, FURTHER, that the Lessee shall
remain liable for all of its monetary obligations hereunder, subject to
applicable law and the provisions of this Section 19;
(d) Hold, use, occupy, operate, repair, remove, lease or keep idle any
or all Property or Equipment as the Lessor in its sole discretion may determine,
without any duty to account to the Lessee with respect to any such action or
inaction or for any proceeds thereof; and
(e) Exercise any other right or remedy which may be available under
applicable law and in general proceed by appropriate judicial proceedings,
either at law or in equity, to enforce the terms hereof or to recover damages
for the breach hereof; PROVIDED, HOWEVER, that no act or thing done by the
Lessor or any of its agents, representatives or employees and no agreement
accepting a surrender of any Property or Equipment shall be valid unless the
same be made in writing and executed by the Lessor.
Suit or suits for the recovery of any default in the payment of any
sum due hereunder or for damages may be brought by the Lessor from time to time
at the Lessor's election, and nothing herein contained shall be deemed to
require the Lessor to await the date whereon this Lease or the term hereof
would have expired by limitation had there been no such default by the Lessee
or no such termination or cancellation.
The receipt of any payments under this Lease by the Lessor with
knowledge of any breach of this Lease by the Lessee or of any default by the
Lessee in the performance of any of the terms, covenants or conditions of this
Lease, shall not be deemed to be a waiver of any provision of this Lease.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
No receipt of moneys by the Lessor from the Lessee after the
termination or cancellation hereof in any lawful manner shall reinstate,
continue or extend the Lease Term or any Renewal Term, or affect any notice
theretofore given to the Lessee, or operate as a waiver of the right of the
Lessor to enforce the payment of Basic Rent or Additional Rent or other charges
payable hereunder, or operate as a waiver of the right of the Lessor to recover
possession of any Unit of Equipment or Parcel of Property by proper suit,
action, proceedings or remedy; it being agreed that, after the service of
notice to terminate or cancel this Lease, and the expiration of the time
therein specified, if the default has not been cured in the meantime, or after
the commencement of any suit, action or summary proceedings or of any other
remedy, or after a final order, warrant or judgment for the possession of any
Unit of Equipment or Parcel of Property, the Lessor may demand, receive and
collect any moneys payable hereunder, without in any manner affecting such
notice, proceedings, suit, action, order, warrant or judgment; and any and all
such moneys so collected shall be deemed to be payments on account of the
Lessee's liability hereunder. Acceptance of the keys to any Parcel of Property,
or any similar act, by the Lessor, or any agent or employee of the Lessor,
during the term hereof, shall not be deemed to be an acceptance of a surrender
of any Parcel of Property unless the Lessor and Assignee shall consent thereto
in writing.
After any Event of Default, the Lessee shall be liable for, and the
Lessor may recover from the Lessee (i) all Basic Rent accrued to date of
payment, (ii) any Additional Rent owing as of such date, (iii) all amounts
payable pursuant to Sections 11, 25 and 27 hereof, (iv) all losses, damages,
costs and expenses (including, without limitation, attorneys' fees and
expenses, , filing fees and sales or transfer taxes) sustained by the Lessor by
reason of such Event of Default and the exercise of the Lessor's remedies with
respect thereto, including without limitation, in the event of a sale by the
Lessor of the Property or Equipment pursuant to this Section 19, all costs and
expenses associated with such sale (PROVIDED that, if the provisions set forth
in this Section 19 are applicable, such losses and damages shall not include
any losses or damages for foregone rent, lost profits or loss of the Lessor's
benefit of the bargain arising after the Lessee has paid in full all amounts
due hereunder, has purchased the Property or Equipment from the Lessor free and
clear of all Liens, and has otherwise performed all its obligations under this
Section 19) and (v) all other amounts owing hereunder. The amounts payable in
clauses (i) through (v) above are hereinafter sometimes referred to as the
"ACCRUED DEFAULT OBLIGATIONS".
After an Event of Default, the Lessor may sell its interest in the
Property and Equipment upon any terms that the Lessor deems satisfactory, free
of any rights of the Lessee or any Person claiming through or under the Lessee
(including, without limitation, any rights hereunder or under the Pledged
Contracts). In the event of any such sale, in addition to the Accrued Default
Obligations, the Lessor shall be entitled to recover from the Lessee, as
liquidated damages and not as a penalty, and subject to the second succeeding
sentence, an amount equal to the Adjusted Acquisition Cost of all Property and
Equipment under this Lease. Proceeds of sale received by the Lessor in excess
of the Adjusted Acquisition Cost of such Property or Equipment shall be
credited against the Accrued Default Obligations the Lessee is required to pay
under this Section 19. If such proceeds exceed the sum of (i) the Accrued
Default Obligations and (ii) the Adjusted Acquisition Cost of all Property and
Equipment under this Lease, such excess shall be paid by the Lessor to the
Lessee. As an alternative to any such sale, in addition to the Accrued Default
Obligations, the Lessor may require the Lessee to pay to the Lessor, and the
Lessee shall pay to the Lessor, as liquidated damages and not as a penalty, an
amount equal to the Adjusted
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
Acquisition Cost of all Property and Equipment under this Lease. If the Lessor
subsequently sells its interest in the Property or Equipment, the proceeds of
any such sale and/or any such amounts realized (net of any unreimbursed costs or
liabilities incurred by the Lessor or Assignee with respect to the Property or
Equipment after the termination of the Lease, which are not included in the
Accrued Default Obligations) shall be distributed as provided in the third and
fourth sentences of this paragraph. Notwithstanding anything to the contrary
contained herein, if the Lessee converts the Property and Equipment or any part
thereof after an Event of Default, or if the Property and Equipment is lost or
destroyed by the Lessee at the time of the Event of Default, in addition to the
Accrued Default Obligations, the Lessor may require the Lessee to pay to the
Lessor, and the Lessee shall pay to the Lessor, as liquidated damages and not as
a penalty, an amount equal to the Adjusted Acquisition Cost of all Property and
Equipment under this Lease.
In the event of a sale pursuant to this Section 19, upon receipt by
the Lessor of the amounts payable hereunder, the Lessor shall transfer all of
the Lessor's right, title and interest in and to the Property and Equipment to
a purchaser other than the Lessee or to the Lessee, as the case may be.
No remedy referred to in this Section 19 is intended to be exclusive,
but each shall be cumulative and in addition to any other remedy referred to
above or otherwise available to the Lessor at law or in equity, and the
exercise in whole or in part by the Lessor of any one or more of such remedies
shall not preclude the simultaneous or later exercise by the Lessor of any or
all such other remedies.
No waiver by the Lessor of any Event of Default hereunder shall in any
way be, or be construed to be, a waiver of any future or subsequent Event of
Default.
With respect to the termination of this Lease as a result of an Event
of Default, the Lessee hereby waives, to the fullest extent permitted by law,
(1) service of any notice of intention to re-enter or the institution of legal
proceedings to obtain re-entry or possession, (2) the benefit of any laws now
or hereafter in force exempting property from liability for rent or limiting
the Lessor with respect to the election of remedies; and (3) any other rights
which might otherwise limit or modify any of the Lessor's rights or remedies
under this Section 19. The Lessee hereby waives any and all rights to recover
or regain possession of the Property and Equipment or to reinstate this Lease
as permitted or provided by or under any statute, law or decision now or
hereafter in force and effect.
SECTION 20. EQUIPMENT TO BE PERSONAL PROPERTY.
It is the intention and understanding of the Lessor and the Lessee
that all Equipment shall be and at all times remain personal property.
SECTION 21. SALE OR ASSIGNMENT BY LESSOR.
(a) Subject to paragraph (b) of this Section 21, the Lessor shall have
the right to obtain equity and debt financing for the acquisition and ownership
of the Property or Equipment by selling or assigning its right, title and
interest in any or all amounts due from the Lessee or any third party under this
Lease and granting a security interest in this Lease to a lender or
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lenders under a Credit Agreement; PROVIDED, that any such sale or assignment
shall be subject to the rights and interests of the Lessee under this Lease.
(b) Any Assignee shall, except as otherwise agreed by the Lessor and
such Assignee, have all the rights, powers, privileges and remedies of the
Lessor hereunder, provided that the Lessee's obligations as between itself and
such Assignee hereunder shall be subject to any claims or defenses that the
Lessee may have against the Lessor. Upon written notice to the Lessee of any
such assignment, the Lessee shall thereafter make payments of Basic Rent,
Additional Rent and other sums due hereunder to such Assignee, to the extent
specified in such notice, and such payments shall discharge the obligation of
the Lessee to the Lessor hereunder to the extent of such payments. Anything
contained herein to the contrary notwithstanding, no Assignee shall be obligated
to perform any duty, covenant or condition required to be performed by the
Lessor hereunder, and any such duty, covenant or condition shall be and remain
the sole obligation of the Lessor.
(c) The provisions of this Section 21 are subject to the terms and
conditions of the Participation Agreement.
SECTION 22. INCOME TAXES.
Each of the Lessor and the Lessee agrees that it will not file any
Federal, state or local income tax returns during the Lease Term or Renewal
Term, if any, with respect to any Property or Equipment that are inconsistent
with the treatment of the Lessee as owner of such Property or Equipment for
Federal, state and local income tax purposes.
SECTION 23. NOTICES AND REQUESTS.
All notices, offers, acceptances, approvals, waivers, requests,
demands and other communications hereunder or under any other instrument,
certificate or other document delivered in connection with the transactions
described herein shall be in writing, shall be addressed as provided below and
shall be considered as properly given (a) if delivered in person, (b) if sent
by reputable express courier service (including, without limitation, Federal
Express, ▇▇▇▇▇, DHL, Airborne Express, and other similar express delivery
services), (c) if mailed through the United States Postal Service, postage
prepaid, registered or certified with return receipt requested, or (d) if sent
by telecopy and confirmed; PROVIDED, that in the case of a notice by telecopy,
the sender shall in addition confirm such notice by writing sent in the manner
specified in clauses (a), (b) or (c) of this Section 23. All notices shall be
effective upon receipt by the addressee; PROVIDED, HOWEVER, that if any notice
is tendered to an addressee and the delivery thereof is refused by such
addressee, such notice shall be effective upon such tender. For the purposes of
notice, the addresses of the parties shall be as set forth below; PROVIDED,
HOWEVER, that any party shall have the right to change its address for notice
hereunder to any other location by giving written notice to the other party in
the manner set forth herein. The initial addresses of the parties hereto are as
follows:
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
If to the Lessor:
TCA Network Funding, Limited Partnership
c/o ML Leasing Equipment Corp.
North Tower
World Financial Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy of all notices under this Section 23 to be simultaneously given,
delivered or served to ▇▇▇▇ ▇▇▇▇▇ at the following address:
ML Leasing Equipment Corp.
Controller's Office
World Financial Center
South Tower - 14th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
If to any Lessee:
c/o TravelCenters of America, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy of all notices under this Section 23 to any Assignee at such
address as such Assignee may specify by written notice to the Lessor and the
Lessee.
SECTION 24. QUIET ENJOYMENT.
During the Lease Term or Renewal Term, if any, of any Property or
Equipment hereunder and so long as no Event of Default shall have occurred and
be continuing, the Lessor recognizes the Lessee's right to quiet enjoyment of
the Property and Equipment on the terms and conditions provided in this Lease
and the Agreement for Lease without any interference from the Lessor or anyone
claiming through or under the Lessor.
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SECTION 25. RIGHT TO PERFORM FOR LESSEE.
(a) If the Lessee fails to perform or comply with any of its covenants
or agreements contained in this Lease, the Lessor may, upon not less than ten
(10) Business Days' notice to the Lessee but without waiving or releasing any
obligations or default, itself perform or comply with such covenant or
agreement, and the amount of the reasonable expenses of the Lessor incurred in
connection with such performance or compliance, shall be payable by the Lessee,
not later than ten (10) days after written notice by the Lessor.
(b) Without in any way limiting the obligations of the Lessee
hereunder, the Lessee hereby irrevocably appoints the Lessor as its agent and
attorney at the time at which the Lessee is obligated to deliver possession of
any Parcel of Property or Unit of Equipment to the Lessor, to demand and take
possession of such Parcel of Property or Unit of Equipment in the name and on
behalf of the Lessee from whomsoever shall be at the time in possession thereof.
SECTION 26. MERGER, CONSOLIDATION OR SALE OF ASSETS.
The Lessee may not consolidate with or merge into another corporation
or sell all or substantially all of its assets to any Person, except that the
Lessee may consolidate with or merge into another corporation, or sell all or
substantially all of its assets to any Person; PROVIDED, that the surviving
corporation or transferee Person shall assume, by execution and delivery of
instruments satisfactory to the Lessor, the obligations of the Lessee hereunder
and become successor to the Lessee, but the Lessee shall not thereby be
released, without the consent of the Lessor, from its obligations hereunder and
provided, further, that such surviving corporation or transferee Person will,
on a pro forma basis, immediately after such consolidation, merger or sale,
possess a consolidated net worth substantially equivalent to or greater than
that of the Lessee immediately prior to such consolidation, merger or sale.
Notwithstanding the immediately preceding sentence, nothing contained in this
Section 26 shall prevent any consolidation or merger of TA Operating
Corporation with or into National Auto/Truckstops, Inc. or the consolidation or
merger of National Auto/Truckstops, Inc. with or into TA Operating Corporation.
The terms and provisions of this Lease shall be binding upon and inure to the
benefit of the Lessee and its respective successors and assigns.
SECTION 27. EXPENSES.
The Lessee shall pay all of the out-of-pocket costs and expenses
incurred by the Lessor, and any Assignee in connection with this Lease
including, without limitation, the reasonable fees and disbursements of counsel
to the Lessor and counsel to any Assignee.
SECTION 28. PERMITTED CONTESTS.
(a) The Lessee shall not be required, nor shall the Lessor have the
right, to pay, discharge or remove any tax, assessment, levy, fee, rent, charge
or Lien, or to comply or cause any Parcel of Property or Unit of Equipment to
comply with any Legal Requirements applicable to any Parcel of Property or Unit
of Equipment or the occupancy, use or operation thereof, so long as no Event of
Default exists under this Lease with respect to any Parcel of Property or Unit
of Equipment, and, in the reasonable judgment of the Lessee's counsel, the
Lessee shall have reasonable grounds to contest the existence, amount,
applicability or validity thereof by
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
appropriate proceedings, which proceedings in the reasonable judgment of the
Lessor and Assignee, (i) shall not involve any material danger that any Parcel
of Property or Unit of Equipment or any Basic Rent or any Additional Rent would
be subject to sale, forfeiture or loss, as a result of failure to comply
therewith, (ii) shall not affect the payment of any Basic Rent or any Additional
Rent or other sums due and payable hereunder or result in any such sums being
payable to any Person other than the Lessor or any Assignee, (iii) will not
place either the Lessor or any Assignee in any danger of civil liability for
which the Lessor or any Assignee is not adequately indemnified (for purposes of
this Section 28(a), the Lessee's obligations under Section 11 of this Lease
shall be deemed to be adequate indemnification if no Event of Default or
Termination Event exists and if such civil liability is reasonably likely to be
less than $250,000 per Parcel or Unit and $1,000,000 in the aggregate) or to any
criminal liability, (iv) if involving taxes, shall suspend the collection of
taxes, and (v) shall be permitted under and be conducted in accordance with the
provisions of any other instrument to which the Lessee or the Parcel of Property
or Unit of Equipment is subject and shall not constitute a default thereunder
(the "PERMITTED CONTEST"). The Lessee shall conduct all Permitted Contests in
good faith and with due diligence and shall promptly after the final
determination (including appeals) of any Permitted Contest, pay and discharge
all amounts which shall be determined to be payable therein. The Lessor shall
cooperate in good faith with the Lessee with respect to all Permitted Contests
conducted by the Lessee pursuant to this Section 28.
(b) In the event the Lessor or any Assignee deems, in its reasonable
discretion, that its interests under this Lease or in any Parcel of Property or
Unit of Equipment are not adequately protected in connection with a Permitted
Contest brought by the Lessee under this Section 28, the Lessee shall, at its
option, either provide security to the Lessor in the form of a reserve fund
established by the Lessee in an amount reasonably acceptable to the Lessor, or
provide such other reasonable security as may be demanded by the Lessor or any
Assignee to ensure payment of such tax, assessment, levy, fee, rent, charge or
Lien and compliance with Legal Requirements and to prevent any sale or
forfeiture of any Parcel of Property or Unit of Equipment, any Basic Rent or any
Additional Rent by reason of such nonpayment or noncompliance. The Lessee hereby
agrees that the Lessor may assign such security provided by the Lessee to any
Assignee.
(c) At least ten (10) days prior to the commencement of any Permitted
Contest, the Lessee shall notify the Lessor and any Assignee in writing thereof
if the amount in contest exceeds $250,000, and shall describe such proceeding in
reasonable detail. In the event that a taxing authority or subdivision thereof
proposes an additional assessment or levy of any tax for which the Lessee is
obligated to reimburse the Lessor under this Lease, or in the event that the
Lessor is notified of the commencement of an audit or similar proceeding which
could result in such an additional assessment, then the Lessor shall in a timely
manner notify the Lessee in writing of such proposed levy or proceeding.
SECTION 29. LEASEHOLD INTERESTS.
(a) The Lessee hereunder covenants and agrees to perform and to observe
all of the terms, covenants, provisions, conditions and agreements of each
Ground Lease on the Lessor's part as lessee thereunder to be performed and
observed (including, without limitation, payment of all rent, additional rent
and other amounts payable by the Lessor as lessee under the
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
Ground Lease) to the end that all things shall be done which are necessary to
keep unimpaired the rights of the Lessor as lessee under the Ground Lease. The
Lessee further covenants that it shall cause to be exercised any renewal option
contained in the Ground Lease which relates to renewal occurring in whole or in
part during the term of this Lease.
(b) The Lessee covenants and agrees pursuant to Section 11 hereof to
indemnify and hold harmless the Lessor and any Assignee from and against any and
all liability, loss, damage, suits, penalties, claims and demands of every kind
and nature (including, without limitation, reasonable attorneys' fees and
expenses) by reason of the Lessee's failure to comply with the Ground Lease or
the provisions of this Section 29.
(c) The Lessor and the Lessee agree that the Lessor shall have no
obligation or responsibility to provide services or equipment required to be
provided or repairs or restorations required to be made in accordance with the
provisions of the Ground Lease by the lessor thereunder. The Lessor shall in no
event be liable to the Lessee nor shall the obligations of the Lessee hereunder
be impaired or the performance thereof excused because of any failure or delay
on the part of the lessor under the Ground Lease in providing such services or
equipment or making such restorations or repairs and such failure or delay shall
not constitute a basis for any claim against the Lessor or any offset against
any amount payable to the Lessor under this Lease.
(d) If the Lessor's interest under any Ground Lease shall expire,
terminate or otherwise be extinguished, the lease of the Parcel of Property to
which such Ground Lease relates shall thereupon terminate as provided in this
paragraph (d). Upon such expiration, termination or extinguishment, the Lessee
shall be required to purchase the Lessor's interest in such Parcel of Property
at its Adjusted Acquisition Cost. If the Lessee shall be required to purchase
the Lessor's interest in such affected Parcel, then (i) on the Basic Rent
Payment Date next succeeding such event, the Lessee shall pay to the Lessor an
amount equal to the Adjusted Acquisition Cost of such Property, (ii) the Lease
Term or Renewal Term of such Property shall continue until the date on which the
Lessor receives payment from the Lessee of the amount payable pursuant to this
paragraph (d) and of all Basic Rent payable, and any Additional Rent and other
amounts owing hereunder, and shall then terminate upon the payment of such
amounts and (iii) the Lessor shall on such date transfer title to the Lessor's
interest in such Parcel to the Lessee.
(e) The Lessee shall ensure that each Ground Lease shall be a
Mortgageable Ground Lease.
SECTION 30. MISCELLANEOUS.
(a) All agreements, indemnities, representations and warranties set
forth herein and the obligation set forth herein to pay Basic Rent and
Additional Rent and other amounts payable under this Lease, shall survive until
the expiration or other termination of this Lease, provided that (i) any
monetary obligation under this Lease accrued at the time of or related to
periods prior to such expiration or other termination shall survive such
expiration or other termination to the extent that such obligations have not yet
been satisfied, and (ii) any non-monetary obligation under this Lease which is
expressly provided to be performed after or to
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THIS LEASE AGREEMENT IS
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PROPRIETARY
survive the expiration or termination of this Lease shall survive the expiration
or other termination hereof.
(b) This Lease, the Unit Leasing Records and the AFL Unit Leasing
Records covering Property or Equipment leased pursuant hereto and the
instruments, documents or agreements referred to herein constitute the entire
agreement between the parties with respect to this Lease and no representations,
warranties, promises, guarantees or agreements, oral or written, express or
implied, have been made by any party hereto with respect to this Lease, except
as provided herein or therein.
(c) This Lease may not be amended, modified or terminated, nor may any
obligation hereunder be waived orally, and no such amendment, modification,
termination or waiver shall be effective for any purpose unless it is in
writing, signed by the party against whom enforcement thereof is sought. A
waiver on one occasion shall not be construed to be a waiver with respect to any
other occasion.
(d) The captions in this Lease are for convenience of reference only
and shall not be deemed to affect the meaning or construction of any of the
provisions hereof. Any provision of this Lease which is prohibited by law or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and the parties hereto shall negotiate in good
faith appropriate modifications to reflect such changes as may be required by
law, and, as nearly as possible, to produce the same economic, financial and tax
effects as the provision which is prohibited or unenforceable; and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the Lessee and the Lessor hereby waive any
provision of law which renders any provision hereof prohibited or unenforceable
in any respect. THIS LEASE HAS BEEN EXECUTED AND DELIVERED IN THE STATE OF NEW
YORK. THE LESSEE AND THE LESSOR AGREE THAT, TO THE MAXIMUM EXTENT PERMITTED BY
THE LAW OF THE STATE OF NEW YORK, THIS LEASE, AND THE RIGHTS AND DUTIES OF THE
LESSEE AND THE LESSOR HEREUNDER, SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW)
IN ALL RESPECTS, INCLUDING WITHOUT LIMITATION IN RESPECT OF ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE. THE LESSEE HEREBY IRREVOCABLY SUBMITS,
FOR ITSELF AND ITS PROPERTY, TO THE JURISDICTION OF THE UNITED STATES DISTRICT
COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND THE SUPREME COURT OF THE STATE
OF NEW YORK IN THE COUNTY OF NEW YORK IN ANY ACTION, SUIT OR PROCEEDING BROUGHT
AGAINST IT AND RELATED TO OR IN CONNECTION WITH THIS LEASE OR THE TRANSACTIONS
CONTEMPLATED HEREBY, AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE LESSEE
HEREBY WAIVES AND AGREES NOT TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR
OTHERWISE IN ANY SUCH SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT
PERSONALLY SUBJECT TO THE JURISDICTION OF SUCH COURT, THAT THE SUIT, ACTION OR
PROCEEDING IS BROUGHT IN AN
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THIS LEASE AGREEMENT IS
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PROPRIETARY
INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS
IMPROPER, OR THAT THIS LEASE OR ANY DOCUMENT OR ANY INSTRUMENT REFERRED TO
HEREIN OR THE SUBJECT MATTER HEREOF MAY NOT BE LITIGATED IN OR BY SUCH COURT. TO
THE EXTENT PERMITTED BY APPLICABLE LAW, THE LESSEE AGREES NOT TO SEEK AND HEREBY
WAIVES THE RIGHT TO ANY REVIEW OF THE JUDGMENT OF ANY SUCH COURT BY ANY COURT OF
ANY OTHER NATION OR JURISDICTION WHICH MAY BE CALLED UPON TO GRANT AN
ENFORCEMENT OF SUCH JUDGMENT. THE LESSEE AGREES THAT SERVICE OF PROCESS MAY BE
MADE UPON IT BY CERTIFIED OR REGISTERED MAIL TO THE ADDRESS FOR NOTICES SET
FORTH IN THIS LEASE OR ANY METHOD AUTHORIZED BY THE LAWS OF NEW YORK. THE LESSOR
AND THE LESSEE EXPRESSLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM RELATED TO THIS LEASE OR THE TRANSACTIONS
CONTEMPLATED HEREBY. THE LESSOR AND THE LESSEE ACKNOWLEDGE THAT THE PROVISIONS
OF THIS PARAGRAPH (D) OF SECTION 30 HAVE BEEN BARGAINED FOR AND THAT THEY HAVE
BEEN REPRESENTED BY COUNSEL IN CONNECTION THEREWITH.
(e) In connection with any sale of Property or Equipment pursuant to
Section 12, 13, 14, 15, 19 or 29 of this Lease, when the Lessor transfers title,
such transfer shall be on an as-is, non-installment sale basis, without warranty
by, or recourse to, the Lessor, except that such title shall be free of any
Liens resulting from the Lessor's willful or knowing act or omission. The
purchase price for any such sale shall be paid entirely in cash in immediately
available funds.
(f) In connection with the sale or purchase of Property or Equipment
pursuant to Section 12, 13, 14, 15, 19 or 29 of this Lease, the Lessee shall pay
or shall cause the purchaser of such Property or Equipment to pay in addition to
the purchase price, all transfer taxes, transfer gains taxes, mortgage recording
tax, if any, recording and filing fees and all other similar taxes, fees
(including, without limitation, brokerage fees), expenses and closing costs
(including reasonable attorneys' fees) in connection with the conveyance of such
Property or Equipment to the Lessee or any purchaser.
(g) If any costs of the Lessor related to the Agreement for Lease which
were not included in the Acquisition Cost of a Parcel of Property are allocated
to such Parcel of Property pursuant to the definition of Unit Acquisition Cost
in the Agreement for Lease, the Lessee and the Lessor shall execute a revised
AFL Unit Leasing Record to amend the Acquisition Cost for such Parcel to reflect
the increase in the Acquisition Cost.
(h) Each time that any Adjusted Acquisition Cost is increased or
decreased pursuant to the terms of this Lease (other than a decrease in
connection with the scheduled payments of Quarterly Rent Components), the Lessee
shall promptly revise the AFL Unit Leasing Record or Unit Leasing Record, as the
case may be, for such Parcel of Property or Unit of Equipment to reflect such
increase or decrease and shall provide the Lessor and the Assignee a copy of
such revised AFL Unit Leasing Record or Unit Leasing Record within three (3)
Business Days of such increase or decrease.
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THIS LEASE AGREEMENT IS
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PROPRIETARY
(i) All consents or approvals required to be given by the Lessor
pursuant to the provisions of this Lease shall be deemed given if not otherwise
specifically granted or denied within ten (10) Business Days of receipt by the
Lessor of written request from the Lessee.
SECTION 31. NO RECOURSE.
The Lessor's obligations hereunder are intended to be the obligations
of the limited partnership and of the corporation which is the general partner
thereof only and no recourse for the payment of any amount due under this
Lease, the Ground Lease or any other agreement contemplated hereby or for any
claim based thereon or otherwise in respect thereof, shall be had against any
limited partner of the Lessor or any incorporator, shareholder, officer,
director or Affiliate, as such, past, present or future of the corporate
general partner or of any corporate limited partner or of any successor
corporation to such corporate general partner or any corporate limited partner
of the Lessor, or against any direct or indirect parent corporation of the
corporate general partner or of any limited partner of the Lessor or any other
subsidiary or Affiliate of any such direct or indirect parent corporation or
any incorporator, shareholder, officer or director, as such, past, present or
future, of any such parent or other subsidiary or Affiliate. Nothing contained
in this Section 31 shall be construed to limit the exercise or enforcement, in
accordance with the terms of this Lease and any other documents referred to
herein, of rights and remedies against the limited partnership or the corporate
general partner of the Lessor or of the Lessor or the assets of the limited
partnership or the corporate general partner of the Lessor.
SECTION 32. NO MERGER.
There shall be no merger of this Lease or of the leasehold estate
hereby created with the fee estate or ground leasehold estate in any Parcel of
Property by reason of the fact that the same person acquires or holds, directly
or indirectly, this Lease or the leasehold estate hereby created or any
interest herein or in such leasehold estate as well as the fee estate in any
Parcel of Property or any interest in such fee estate.
SECTION 33. CERTAIN LIMITATIONS.
It is the intention of the parties hereto to conform strictly to all
usury laws that are applicable to each such party, this Lease and to each of
the transactions contemplated by this Lease (collectively the "TRANSACTIONS").
Accordingly, notwithstanding anything to the contrary in this Lease, or any
other document, certificate, instrument or agreement entered in connection with
the Transactions (collectively the "TRANSACTION DOCUMENTS"), it is agreed as
follows: (i) the aggregate of all consideration which constitutes interest
under Applicable Usury Law (hereinafter defined) that is contracted for, taken,
reserved, charged or received by any party under the Transaction Documents or
otherwise in connection with the Transactions shall under no circumstances
exceed the maximum amount of interest that would lawfully be charged by such
party under Applicable Usury Law, (ii) in the event that maturity of any
indebtedness evidenced by or payable pursuant to the Transaction Documents is
accelerated for any reason, or in the event of any required or permitted
payment or prepayment of all or any part of such indebtedness (including,
without limitation, and if applicable, any required or permitted purchase of
any Unit Premises, Unit Improvements, Unit FF&E or Unit, or any required or
permitted payment of the Unit Acquisition Cost), then such consideration that
constitutes interest as to any
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THIS LEASE AGREEMENT IS
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PROPRIETARY
such indebtedness under Applicable Usury Law may never include more than the
maximum amount allowed by such Applicable Usury Law, and (iii) excess interest,
if any, provided for in the Transaction Documents or otherwise in connection
with the Transactions shall be, in accordance with the following provisions of
this Section 33, cancelled automatically and, if theretofore paid, shall be
credited by the recipient on the principal or stated amount of the affected
indebtedness (or, to the extent that the principal or stated amount of such
indebtedness shall have been or would thereby be paid in full, refunded by such
recipient to the party entitled thereto). If at any time the rate of interest
(denominated as such) contractually called for in any Transaction Document (as
the same may vary from time to time pursuant to the terms of such Transaction
Document, the "STATED RATE"), exceeds the maximum non-usurious rate of interest
permitted by Applicable Usury Law (the "MAXIMUM RATE") in respect of the
indebtedness evidenced by such Transaction Document, taking into account all
other amounts paid or payable pursuant to the Transaction Documents which
constitute interest with respect to such indebtedness under Applicable Usury Law
regardless of whether denominated as interest (collectively, the "OTHER
CHARGES"), then the rate of interest to accrue on such indebtedness shall be
limited to such Maximum Rate (taking into account the Other Charges), but any
subsequent reduction in the Stated Rate applicable to such indebtedness shall
not reduce the rate of interest or yield to accrue on such indebtedness to a
rate that is less than such Maximum Rate (taking into account the Other Charges)
until such time as the total amount of interest or yield on such indebtedness
equals the amount of interest or yield which would have accrued if the Stated
Rate applicable to such indebtedness had at all times been in effect. If at the
maturity or final payment of any indebtedness the total amount of interest or
yield paid or accrued on such indebtedness under the preceding sentence is less
than the total amount of interest or yield which would have accrued if the
Stated Rate applicable to such indebtedness had at all times been in effect,
then to the fullest extent permitted by Applicable Usury Law there shall be due
and payable with respect to such indebtedness an amount equal to the excess, if
any, of (a) the lesser of (i) the amount of interest which would have accrued on
such indebtedness if such Maximum Rate in respect of such indebtedness had at
all times been in effect and been chosen as the rate of interest or yield to be
applicable throughout the term of such indebtedness (taking into account the
Other Charges) and (ii) the amount of interest which would have accrued on such
indebtedness if the Stated Rate applicable to such indebtedness had at all times
been in effect, over (b) the amount of interest accrued in accordance with the
provisions of the Transaction Document evidencing such indebtedness after giving
effect to the preceding sentence. All amounts paid or agreed to be paid for the
forbearance or detention of sums pursuant to or in connection with the
Transaction Documents shall, to the extent permitted by Applicable Usury Law, be
amortized, prorated, allocated and spread throughout the full term thereof so
that the rate or amount of interest paid or payable with respect to any amount
of indebtedness evidenced or payable pursuant to the Transaction Documents does
not exceed the applicable usury ceiling, if any. As used herein, the term
"APPLICABLE USURY LAW" means that law, if any, that is applicable to any
particular Transaction and that limits the maximum non-usurious rate of interest
that may be taken, contracted for, charged, reserved or received with respect to
such Transaction, including the Federal laws of the United States of America,
the laws of the State of New York, the laws of the State of Texas, and the laws
of any other jurisdiction that may be mandatorily applicable to such Transaction
notwithstanding other provisions of this Lease and the other Transaction
Documents. As used herein, the term "INTEREST" means interest as determined
under Applicable Usury Law, regardless of whether denominated as interest in the
Transaction
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
Documents (except to the extent that this Section 33 specifically refers to
interest denominated as interest). The right to accelerate maturity of any
indebtedness evidenced by any Transaction Document, and the right to demand
payment of the Unit Acquisition Cost does not include the right to accelerate
any interest, or to receive any other amounts, which would cause the
Transactions to be usurious under Applicable Usury Law. To the extent (if any)
that Texas law determines the Maximum Rate, such Maximum Rate shall be
determined by utilizing the indicated rate (weekly) ceiling from time to time in
effect pursuant to Texas Revised Civil Statutes Annotated Article 5069-1.04, as
amended. In no event will the provisions of Texas Revised Civil Statues
Annotated Articles 5069-2.01 through 5069-8.06 or 5069-15.01 through 5069-15.11
be applicable to the Transactions. All computations of the maximum amount
allowed under Applicable Usury Law will be made on the basis of the actual
number of days elapsed over a 365 or 366 day year, whichever is applicable
pursuant to such Applicable Usury Law. The provisions of this Section 33 shall
prevail over any contrary provisions of this Lease or any of the other
Transaction Documents.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
IN WITNESS WHEREOF, the Lessor and the Lessee have caused
this Lease to be executed and delivered as of the day and year first above
written.
TCA Network Funding, Limited Partnership
By: TCA Network Capital, Inc.,
its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
TA Operating Corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
National Auto/Truckstops, Inc.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
EXHIBIT A
Real Property
Furniture, fixtures and
equipment
Other*
----------
* As agreed between the Lessee and the Lessor.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
EXHIBIT B
AFL UNIT LEASING RECORD to Lessor: TCA Network Funding, Limited
the Lease Agreement, dated Partnership
as of September __, 1999 Lessee: TA Operating Corporation
between TCA Network Funding, and National
Limited Partnership, as lessor, Auto/Truckstops, Inc.
and TA Operating Corporation and
National Auto/Truckstops, Inc.,
as lessee (the "LEASE AGREEMENT").
A. AFL ULR NO.: __________
Effective Date of this AFL Unit Leasing Record ("AFL ULR") _________
___.
B. PLEASE COMPLETE THE FOLLOWING STATEMENTS, IF APPLICABLE:
1. This AFL ULR relates to [Deed/Ground Lease] dated _______ ___.
PROPERTY DESCRIPTION AND RENTAL INFORMATION.
C. Type of Property (use category specified in Exhibit A to the Lease
Agreement)
D. Specific Description: (See Schedule A hereto if more space needed)
------------------------------------------------------------------------------
------------------------------------------------------------------------------
E. Location of
Property -----------------------------------------------------
State County City
F. Unit Acquisition Cost under the Agreement for Lease is $ .
------------
G. The Lease Term and Renewal Term, if any, for the Property placed under
lease pursuant to this AFL ULR will be in accordance with the Lease
Agreement.
H. The Basic Rent is as defined in the Lease Agreement. Each Quarterly
Rent Component will be in accordance with Schedule I hereto.
I. The Basic Rent for the Renewal Term equals fair market value rental.
J. Termination of the lease of the Property leased pursuant to this AFL
ULR will be in accordance with the Lease Agreement.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
K. ACKNOWLEDGMENT AND EXECUTION
The undersigned Lessor hereby leases to the undersigned Lessee, and
the Lessee acknowledges delivery to it of the Property described on
this AFL ULR. The Lessee agrees to pay the Basic Rent, Additional Rent
and additional payments set forth in the Lease Agreement. The
covenants, terms and conditions of this lease are those appearing in
the Lease Agreement, as it may from time to time be amended, which
covenants, terms and conditions are hereby incorporated by reference.
The terms used herein have the meaning assigned to them in the Lease
Agreement.
TA Operating Corporation, TCA Network Funding, Limited
Lessee Partnership, Lessor By TCA Network
Capital, Inc., as General Partner
By: By:
---------------------------- ------------------------------
Name: Name:
Title: Title:
National Auto/Truckstops, Inc.,
Lessee
By:
----------------------------
Name:
Title:
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
EXHIBIT C
UNIT LEASING RECORD to Lessor: TCA Network Funding, Limited
the Lease Agreement, dated Partnership
as of September __, 1999 Lessee: TA Operating Corporation and
between TCA Network Funding, National Auto/Truckstops,
Limited Partnership, as lessor, Inc.
and TA Operating Corporation and
National Auto/Truckstops, Inc.,
as lessee (the "LEASE AGREEMENT").
A. ULR No.: ______
Effective Date of this
Unit Leasing Record ("ULR")
-------------- -------------.
B. PLEASE COMPLETE THE FOLLOWING STATEMENTS, IF APPLICABLE:
1. This ULR relates to [Deed/Ground Lease/▇▇▇▇ of Sale/Invoice] dated
-----------------.
PROPERTY OR EQUIPMENT DESCRIPTION AND RENTAL INFORMATION
C. Type of Property or Equipment (use category specified in Exhibit A to
the Lease Agreement)
-----------------------
D. Specific Description (See Schedule A hereto if more space needed)
-----------------------------------------------------------------
-----------------------------------------------------------------
E. Location of Property
or Equipment
-----------------------------------------------
State County City
F. Basic Cost Additional Charges Sale & Use Tax Acquisition Cost
$ + $ + $ = $
--------- ----------------- ------------- ---------------
G. The Lease Term and Renewal Term, if any, for the Property or Equipment
placed under lease pursuant to this ULR will be in accordance with the
Lease Agreement.
H. The Basic Rent is as defined in the Lease Agreement. Each Quarterly
Rent Component will be as set forth on Schedule I hereto.
I. The Basic Rent for the Renewal Term equals fair market value rental.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
J. Termination of the lease of the Property or Equipment leased pursuant
to this ULR will be in accordance with the Lease Agreement.
K. ACKNOWLEDGMENT AND EXECUTION
The undersigned Lessor hereby leases to the undersigned Lessee, and
the Lessee acknowledges delivery to it in good condition of the
Property or Equipment described on this ULR. The Lessee agrees to pay
the Basic Rent, Additional Rent and additional payments set forth in
the Lease Agreement. The covenants, terms and conditions of this lease
are those appearing in the Lease Agreement, as it may from time to
time be amended, which covenants, terms and conditions are hereby
incorporated by reference. The terms used herein have the meaning
assigned to them in the Lease Agreement.
TA Operating Corporation, TCA Network Funding, Limited
Lessee Partnership, Lessor
By TCA Network Capital, Inc.,
as General Partner
By: By:
--------------------------- --------------------------------
Name: Name:
Title: Title:
National Auto/Truckstops, Inc.,
Lessee
By:
---------------------------
Name:
Title:
C-2
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
EXHIBIT D
PLEDGE AGREEMENT
See Tab 6.3
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
EXHIBIT E
TA OPERATING CORPORATION PARCEL OF PROPERTY
1. The Property located at San Antonio, Texas.
2. The Property located at Cartersville, Georgia.
3. The Property located at Monroe, Michigan.
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
EXHIBIT F
NATIONAL AUTO/TRUCKSTOPS, INC. PARCEL OF PROPERTY
1. The Property located at Amarillo, Texas.
F-1
82
This Lease Agreement is
Confidential and Proprietary
EXHIBIT G
FORM OF NON-DISTURBANCE, RECOGNITION AND ATTORNMENT AGREEMENT
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THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
TABLE OF CONTENTS
PAGE
SECTION 1. DEFINED TERMS.............................................................1
SECTION 2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF EACH LESSEE................13
SECTION 3. LEASE OF PROPERTY OR EQUIPMENT...........................................24
SECTION 4. OPERATING LEASE..........................................................26
SECTION 5. DELIVERY.................................................................26
SECTION 6. LEASE TERM...............................................................31
SECTION 7. RENT AND OTHER PAYMENTS..................................................31
SECTION 8. RESTRICTED USE; COMPLIANCE WITH LAWS.....................................32
SECTION 9. MAINTENANCE, IMPROVEMENT AND REPAIR OF PROPERTY OR EQUIPMENT.............34
SECTION 10. INSURANCE................................................................38
SECTION 11. INDEMNITIES..............................................................41
SECTION 12. LESSEE'S RIGHT OF PURCHASE...............................................44
SECTION 13. LESSEE'S RIGHTS OF SURRENDER AND RENEWAL.................................46
SECTION 14. TERMINATION UPON CERTAIN EVENTS..........................................49
SECTION 15. LOSS OF OR DAMAGE TO PROPERTY OR EQUIPMENT...............................50
SECTION 16. CONDEMNATION AND DEDICATION OF PROPERTY; EASEMENTS.......................51
SECTION 17. SURRENDER OF PROPERTY OR EQUIPMENT.......................................52
SECTION 18. EVENTS OF DEFAULT........................................................53
SECTION 19. RIGHTS UPON DEFAULT......................................................55
SECTION 20. EQUIPMENT TO BE PERSONAL PROPERTY........................................57
SECTION 21. SALE OR ASSIGNMENT BY LESSOR.............................................57
SECTION 22. INCOME TAXES.............................................................58
SECTION 23. NOTICES AND REQUESTS.....................................................58
SECTION 24. QUIET ENJOYMENT..........................................................59
SECTION 25. RIGHT TO PERFORM FOR LESSEE..............................................60
SECTION 26. MERGER, CONSOLIDATION OR SALE OF ASSETS..................................60
SECTION 27. EXPENSES.................................................................60
SECTION 28. PERMITTED CONTESTS.......................................................60
84
THIS LEASE AGREEMENT IS
CONFIDENTIAL AND
PROPRIETARY
SECTION 29. LEASEHOLD INTERESTS......................................................61
SECTION 30. MISCELLANEOUS............................................................62
SECTION 31. NO RECOURSE..............................................................65
SECTION 32. NO MERGER................................................................65
SECTION 33. CERTAIN LIMITATIONS......................................................65
EXHIBIT A Categories of Equipment and Property
EXHIBIT B Form of AFL Unit Leasing Record
EXHIBIT C Form of Unit Leasing Record
EXHIBIT D Pledge Agreement
EXHIBIT E TA Operating Corporation Property and Equipment
EXHIBIT F National Auto/Truckstops, Inc. Property and Equipment
EXHIBIT G Form of Non-Disturbance, Recognition and Attornment Agreement
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