EXHIBIT 10.5
PARTICIPATION AGREEMENT
Dated as of December 17, 1998
among
AVIATION SALES COMPANY,
as Construction Agent,
AVIATION SALES COMPANY,
as Lessee,
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually, except as expressly
stated herein, but solely as Owner Trustee
under the Aviation Sales Trust 1998-1,
THE VARIOUS BANKS AND OTHER
LENDING INSTITUTIONS WHICH ARE PARTIES
HERETO FROM TIME TO TIME,
as the Holders,
THE VARIOUS BANKS AND OTHER
LENDING INSTITUTIONS WHICH
ARE PARTIES HERETO FROM TIME TO TIME,
as the Lenders,
and
NATIONSBANK, NATIONAL ASSOCIATION,
as Administrative Agent for the
Lenders
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TABLE OF CONTENTS
SECTION 1. THE LOANS....................................................................................1
SECTION 2. HOLDER FUNDINGS..............................................................................1
SECTION 3. SUMMARY OF TRANSACTIONS......................................................................2
3.1. Operative Agreements..............................................................2
3.2. Property Purchase.................................................................2
3.3. Construction of Improvements; Lease or Disposition of Properties..................2
3.4. Single Property...................................................................2
SECTION 4. THE CLOSINGS.................................................................................2
4.1. Initial Closing Date..............................................................2
4.2. Initial Closing Date; Property Closing Dates; Construction Fundings...............3
SECTION 5. FUNDINGS; REPORTING REQUIREMENTS ON COMPLETION
DATE; LESSEE DELIVERY OF NOTICES................................................................3
5.1. General...........................................................................3
5.2. Procedures for Funding............................................................3
5.3. Conditions to the Holders' and the Lenders' Obligations to advance
funds on the Initial Closing Date or funds for the Acquisition of
Property..........................................................................5
5.4. Conditions to the Holders' and the Lenders' Obligations to Make
Construction Fundings for the Commencement of Construction of any
Improvements......................................................................9
5.5. Conditions to the Holders' and the Lenders' Obligations to Make
Construction Fundings for the Ongoing Construction on any Property
Prior to the Construction Period Termination Date................................10
5.6. Reporting and Delivery Requirements on Completion Date...........................12
5.7. Construction Agent Delivery of Allocation Notice and Construction
Budget Modifications.............................................................13
5.8. Inspection of Documents; Hold Harmless; Removal of Properties....................13
SECTION 6. CONDITIONS OF THE INITIAL CLOSING...........................................................13
6.1. Conditions to the Lessor's and the Holders' Obligations..........................13
6.2. Conditions to the Lessee's Obligations...........................................15
6.3. Conditions to the Agent's Obligations............................................16
SECTION 7. REPRESENTATIONS AND WARRANTIES ON THE INITIAL
CLOSING DATE...................................................................................17
7.1. Representations and Warranties of the Initial Holders............................17
7.2. Representations and Warranties of the Owner Trustee..............................19
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7.3. Representations and Warranties of the Construction Agent and the
Lessee...........................................................................21
7.4. Representations and Warranties of the Agent......................................26
SECTION 8. REPRESENTATIONS AND WARRANTIES ON FUNDING DATES.............................................27
8.1. Representations and Warranties on Property Closing Dates.........................27
8.2. Representations and Warranties Upon Initial Construction Fundings................28
8.3. Representations and Warranties Upon the Date of Each Construction
Funding that is not an Initial Construction Funding..............................30
SECTION 9. PAYMENT OF CERTAIN EXPENSES.................................................................31
9.1. Transaction Expenses.............................................................31
9.2. Certain Fees and Expenses........................................................32
9.3. Unused Fee and Holder Unused Fee. ...............................................33
SECTION 10. OTHER COVENANTS AND AGREEMENTS.............................................................33
10.1. Cooperation with the Construction Agent or the Lessee............................33
10.2. Covenants of the Owner Trustee and the Holders...................................33
10.3. Lessee Covenants, Consent and Acknowledgment; Construction Agent
Covenants........................................................................36
10.4. Sharing of Certain Payments......................................................38
10.5. Grant of Easements, Voting at Meetings, etc......................................38
SECTION 11. CREDIT AGREEMENT AND TRUST AGREEMENT.......................................................38
11.1. Construction Agent's and Lessee's Credit Agreement Rights........................38
11.2. Construction Agent's and Lessee's Trust Agreement Rights.........................39
SECTION 12. TRANSFER OF INTEREST.......................................................................39
12.1. Restrictions on Transfer.........................................................39
12.2. Effect of Transfer...............................................................40
SECTION 13. INDEMNIFICATION............................................................................40
13.1. General Indemnity................................................................40
13.2. General Tax Indemnity............................................................43
13.3. Environmental Indemnity..........................................................47
13.4. Additional Provisions Regarding Indemnification During Construction
Period of a Property.............................................................47
13.5. Indemnification provided by the Owner Trustee in Favor of the Other
Indemnified Persons..............................................................47
SECTION 14. MISCELLANEOUS..............................................................................48
14.1. Survival of Agreements...........................................................48
14.2. No Broker, etc...................................................................49
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14.3. Notices..........................................................................49
14.4. Counterparts.....................................................................51
14.5. Amendments and Termination.......................................................52
14.6. Headings, etc....................................................................52
14.7. Parties in Interest..............................................................52
14.8. GOVERNING LAW; WAIVERS OF JURY TRIAL.............................................52
14.9. Submission to Jurisdiction; Waivers..............................................52
14.10. Severability.....................................................................53
14.11. Liability Limited................................................................53
14.12. Rights of Lessee.................................................................54
14.13. Further Assurances...............................................................54
14.14. Calculations under Operative Agreements..........................................55
14.15. Confidentiality..................................................................55
14.16. Calculation of Rent, Interest, Holder Yield and Fees.............................56
Schedule 1 Initial Holders ..............................................................SCH-1
Schedule 7.3(s) Wetlands..................................................................SCH-7.3-1
Schedule 7.3(t) Environmental Conditions..................................................SCH-7.3-2
EXHIBIT A REQUISITION FORM................................................................A-1
Schedule 1 Legal Description of Land.......................................................A-4
Schedule 2 Description of Improvements.....................................................A-5
Schedule 3 Description of Equipment........................................................A-6
Schedule 4 Work............................................................................A-7
EXHIBIT B AVIATION SALES COMPANY OFFICER'S CERTIFICATE....................................B-1
Schedule 1 [itemized expenditures].........................................................B-3
EXHIBIT C FORM OF OPINION OF COUNSEL TO LESSEE, CONSTRUCTION
AGENT AND GUARANTORS............................................................C-1
EXHIBIT D AVIATION SALES COMPANY OFFICER'S CERTIFICATE....................................D-1
EXHIBIT E AVIATION SALES COMPANY SECRETARY'S CERTIFICATE..................................E-1
EXHIBIT F FIRST SECURITY BANK, NATIONAL ASSOCIATION
OFFICER'S CERTIFICATE...........................................................F-1
EXHIBIT G FIRST SECURITY BANK, NATIONAL ASSOCIATION
CERTIFICATE OF ASSISTANT SECRETARY..............................................G-1
EXHIBIT H FORM OF OPINION OF COUNSEL TO FIRST SECURITY BANK,
NATIONAL ASSOCIATION ...........................................................H-1
EXHIBIT I ADDITIONAL CONDITIONS AND REQUIREMENTS FOR
FUNDINGS........................................................................I-1
Appendix A Rules of Usage and Definitions.........................................Appendix A-1
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PARTICIPATION AGREEMENT
THIS PARTICIPATION AGREEMENT, dated as of December 17, 1998 (as
amended, modified, restated or supplemented from time to time, this
"Agreement"), is by and among AVIATION SALES COMPANY, a Delaware corporation
(the "Construction Agent"); AVIATION SALES COMPANY, as Lessee (the "Lessee");
FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national banking association, not
individually (in its individual capacity, the "Trust Company"), except as
expressly stated herein, but solely as Owner Trustee under the Aviation Sales
Trust 1998-1 (the "Owner Trustee" or the "Lessor"); NATIONSBANK, NATIONAL
ASSOCIATION, as Administrative Agent (in such capacity, the "Agent") for the
Lenders; NATIONSBANK, NATIONAL ASSOCIATION, a national banking association and
the various other banks and lending institutions which are parties hereto from
time to time as Holders; NATIONSBANK, NATIONAL ASSOCIATION and the various other
banks and lending institutions which are parties hereto from time to time as
Lenders. Capitalized terms used but not otherwise defined in this Agreement
shall have the meanings set forth in Appendix A hereto.
In consideration of the mutual agreements herein contained and other
good and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto hereby agree as follows:
SECTION 1. THE LOANS.
The Lenders have agreed to make Loans to the Lessor from time to time
in an aggregate principal amount of up to the aggregate amount of the
Commitments of the Lenders in order for the Lessor to acquire the Properties and
certain Improvements and to develop and construct certain Improvements in
accordance with the Agency Agreement and the terms and provisions hereof, and in
consideration of the receipt of the proceeds of such Loans, the Lessor will
issue the Notes (together with any note or notes issued in exchange or
substitution therefor in accordance with the Credit Agreement, the "Notes"). The
Loans shall be made and the Notes shall be issued pursuant to the Credit
Agreement. Pursuant to SECTION 5 of this Agreement and SECTION 2 of the Credit
Agreement, the Loans will be made to the Lessor from time to time upon the
appropriate submission by the Construction Agent of a Requisition therefor, in
accordance with this Agreement and the other Operative Agreements. The Loans and
the obligations of the Lessor under the Credit Agreement shall be secured by the
Collateral. The Lessee and the Construction Agent agree that each Property shall
be improved for business purposes and shall not merely be held as unimproved
Land for speculative purposes.
SECTION 2. HOLDER FUNDINGS.
Subject to the terms and conditions of this Agreement and in reliance
on the representations and warranties of each of the parties hereto contained
herein or made pursuant hereto on each date Fundings are made in accordance with
SECTION 5 hereof, each Holder shall make a Holder Funding on a pro rata basis to
the Owner Trustee with respect to the Aviation Sales Trust 1998-1 based on its
Holder Commitment in an amount in immediately available funds such that the
aggregate of all Holder Fundings shall be three percent (3%) of the amount of
the
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Funding being funded on such date; provided, no Holder shall be obligated for
any Holder Funding in excess of its pro rata share of the Available Holder
Commitment. The aggregate amount of Holder Fundings shall be up to the aggregate
amount of the Holder Commitments. No prepayment or any other payment with
respect to any Funding shall be permitted such that the Holder Funding with
respect to such Funding is less than 3% of the outstanding amount of such
Funding, except in connection with termination or expiration of the Term or in
connection with the exercise of remedies relating to the occurrence of a Lease
Event of Default. The representations, warranties, covenants and agreements of
the Holders herein and in the other Operative Agreements are several, not joint,
and not joint and several.
SECTION 3. SUMMARY OF TRANSACTIONS.
3.1. OPERATIVE AGREEMENTS. As of the date hereof (the "Initial Closing
Date"), each of the respective parties hereto and thereto shall execute and
deliver this Agreement, the Lease, the Agency Agreement, the Credit Agreement,
the Notes, the Certificates, the Trust Agreement, the Security Agreement and
such other documents, instruments, certificates and opinions of counsel as
agreed to by the parties hereto.
3.2. PROPERTY PURCHASE. On each Property Closing Date and subject to
the terms and conditions of this Agreement (a) the Holders will each make a
Holder Funding in accordance with SECTIONS 2 AND 5 of this Agreement and the
terms and provisions of the Trust Agreement, (b) the Lenders will make Loans in
accordance with SECTIONS 1 AND 5 of this Agreement and the terms and provisions
of the Credit Agreement, and (c) the Lessor will purchase, or lease pursuant to
a Ground Lease, the applicable Property identified by the Construction Agent,
and grant the Agent a Lien on such Property by execution of the required
Security Documents.
3.3. CONSTRUCTION OF IMPROVEMENTS; LEASE OR DISPOSITION OF PROPERTIES.
Construction Fundings will be made with respect to particular Improvements to be
constructed and with respect to ongoing Work regarding the Equipment and ongoing
construction of particular Improvements, in each case, pursuant to the terms and
conditions of this Agreement and the Agency Agreement. The Construction Agent
will act as a construction agent on behalf of the Lessor respecting such Work
and the construction of such Improvements and the expenditures of the
Construction Fundings related thereto. The Construction Agent shall promptly
notify the Lessor upon Completion of the Improvements with respect to each
Property.
3.4. SINGLE PROPERTY. Notwithstanding the foregoing or any other
provision of this Participation Agreement or any other Operative Agreement,
unless and until the definition of "Property" is amended to permit more than one
Property, there shall be only one Property as described in the definition of
"Property" (and, accordingly, there shall be only one Property Closing Date,
only one Initial Construction Funding and only one Completion Date).
SECTION 4. THE CLOSINGS.
4.1. INITIAL CLOSING DATE. All documents and instruments required to be
delivered on the Initial Closing Date shall be delivered at the offices of ▇▇▇▇▇
▇▇▇▇▇ Mulliss & ▇▇▇▇▇, L.L.P.,
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Charlotte, North Carolina, or at such other location as may be determined by the
Lessor, the Agent and the Lessee.
4.2. INITIAL CLOSING DATE; PROPERTY CLOSING DATES; CONSTRUCTION
FUNDINGS. The Construction Agent shall deliver to the Lessor and the Agent a
requisition (a "Requisition"), in the form attached hereto as EXHIBIT A or in
such other form as is reasonably satisfactory to the Lessor, the Construction
Agent and the Agent (together with such additional schedules, affidavits,
releases, waivers, statements, invoices, bills, and other documents,
certificates and information required by the Agent, and any documents required
by Exhibit I or J), in connection with (a) the Initial Closing Date relating to
the Transaction Expenses and other fees, expenses and disbursements payable by
the Lessor pursuant to SECTION 9.1(A) with invoices (in form and substance
reasonably acceptable to the Agent and the Lessor) for such Transaction Expenses
and other fees, expenses and disbursements attached to such Requisition, (b)
each Property Closing Date relating to each Acquisition Funding pursuant to
SECTION 5.3 and (c) each date of a Construction Funding pursuant to SECTIONS 5.4
OR 5.5.
SECTION 5. FUNDINGS; REPORTING REQUIREMENTS ON COMPLETION
DATE; LESSEE DELIVERY OF NOTICES.
5.1. GENERAL. To the extent funds have been made available to the
Lessor as Loans by the Lenders and Holder Fundings by the Holders, the Lessor
will use such funds from time to time in accordance with the terms and
conditions of this Agreement and the other Operative Agreements (i) to pay
interest regarding the Loans relating to a Property and to pay the Holder Yield
regarding the Holder Fundings relating to a Property, in each case to the extent
accrued under the Credit Agreement or Trust Agreement (as the case may be)
during the period prior to the Basic Rent Commencement Date with respect to such
Property, (ii) at the direction of the Construction Agent to acquire Properties
in accordance with the terms of this Agreement, the Agency Agreement, the Lease
and the other Operative Agreements, (iii) to make advances to the Construction
Agent to permit the testing, engineering, installation, development,
construction, modification, design and renovation, as applicable, of
Improvements in accordance with the terms of the Agency Agreement, the Lease and
the other Operative Agreements, and (iv) to pay Transaction Expenses, fees,
expenses and other disbursements payable by the Lessor under SECTIONS 9.1(A) AND
(B).
5.2. PROCEDURES FOR FUNDING.
(a) The Construction Agent shall designate the date for
Fundings hereunder in accordance with the terms and provisions hereof;
provided, however, it is understood and agreed that no more than one
(1) Funding may be requested during any calendar month other than
Fundings which are made solely to fund interest and Holder Yield. Not
less than five (5) Business Days prior to the date of any requested
Base Rate Funding or Eurodollar Funding, the Construction Agent shall
deliver to the Lessor and the Agent, (A) with respect to the Initial
Closing Date and each Property Closing Date, a Requisition as described
in SECTION 4.2 hereof (including without limitation a legal description
of the Land, a schedule of the Improvements, if any, and a schedule of
the Equipment, if any, to
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be acquired on such date, and a schedule of the Work, if any, to be
performed, each of the foregoing in a form reasonably acceptable to the
Lessor and the Agent) and (B) with respect to each Construction
Funding, a Requisition identifying (among other things) the Property to
which such Work relates. Each such Requisition (other than a
Requisition for an Acquisition Funding) shall be delivered to the
Lessor and the Agent on a date between (and including) the first (1st)
and the fifth (5th) Business Day of a calendar month.
(b) Each Requisition shall: (i) be irrevocable, (ii) request
funds in an amount that is not in excess of the total aggregate of the
Available Commitments plus the Available Holder Commitments at such
time, and (iii) request that the Holders make Holder Fundings and that
the Lenders make Loans to the Lessor for the payment of the Property
Acquisition Costs (in the case of an Acquisition Funding) or other
Property Costs, including the cost of Improvements (in the case of a
Construction Funding) that have previously been incurred and were not
subject to a prior Requisition, in each case as specified in the
Requisition.
(c) Subject to the terms and conditions of the Credit
Agreement and the Trust Agreement and subject to the satisfaction of
the conditions precedent set forth in SECTIONS 5.3, 5.4 or 5.5, as
applicable, on each Property Closing Date or the date on which the
Construction Funding is to be made, as applicable,
(i) the Lenders shall make Loans to the Lessor in an
aggregate amount equal to 97% of the sum of (A) the Requested
Funds specified in any Requisition, (B) any additional amount
of Transaction Expenses and other fees, taxes, expenses and
disbursements (as described in SECTION 9.1(A) AND 9.1(B))
(unless such funding of fees, taxes, expenses, disbursements
or Transaction Expenses is declined in writing by each Lender
and each Holder, such decision to be in the sole discretion of
each Lender and each Holder), and (C) any additional amount
respecting any indemnity payment (as described in SECTION
13.5) (unless such indemnity payment is declined in writing by
each Lender and each Holder, in the sole discretion of each
Lender and each Holder) -- up to an aggregate principal amount
equal to the Available Commitments (such Loans to be
apportioned 88% to Series A Loans and 9% to Series B Loans);
(ii) each Holder shall make a pro rata Holder Funding
based on its Holder Commitment in an amount such that the
aggregate of all Holder Fundings at such time shall be 3% of
the sum of (A) the Requested Funds specified in any
Requisition, (B) any additional amount of Transaction Expenses
and other fees, taxes, expenses and disbursements (as
described in SECTION 9.1(A) AND 9.1(B)) (unless such funding
of fees, taxes, expenses, disbursements or Transaction
Expenses is declined in writing by each Lender and each
Holder, such decision to be in the sole discretion of each
Lender and each Holder), and (C) any additional amount
respecting any indemnity payment (as described in SECTION
13.5) (unless such indemnity payment is declined in writing by
each Lender and each Holder, in the sole discretion of each
Lender and each Holder) -- provided no such Holder
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Funding shall exceed such Holder's pro rata share of the
Available Holder Commitments; and
(iii) the total amount of such Loans and Holder
Fundings made on such date shall (w) be used by the Lessor to
pay the Property Acquisition Costs within three (3) Business
Days of the receipt by the Lessor of such Funding (in the case
of a Property Closing Date), (x) be used by the Lessor on the
date of such Funding to pay interest regarding the Loans
relating to a Property and to pay the Holder Yield regarding
the Holder Fundings relating to a Property, in each case to
the extent accrued under the Credit Agreement or Trust
Agreement (as the case may be) during the period prior to the
Completion Date with respect to such Property, (y) be used by
the Lessor to pay Transaction Expenses, fees, taxes, expenses,
other disbursements and indemnities to the extent permitted
under SECTIONS 5.3, 5.4, 5.5, 9.1(A), 9.1(B) OR 13.5 (as
applicable), or (z) be disbursed by the Lessor, on the date of
such Funding, to the Construction Agent or the Lessee to pay
Property Costs, as applicable. Any such amounts held by the
Lessor (or the Agent on behalf of the Lessor) shall be subject
to the lien of the Security Agreement.
5.3. CONDITIONS TO THE HOLDERS' AND THE LENDERS' OBLIGATIONS TO ADVANCE
FUNDS ON THE INITIAL CLOSING DATE OR FUNDS FOR THE ACQUISITION OF PROPERTY.
(a) The obligations of each Holder to make Holder Fundings,
and of each Lender to make Loans, to the Lessor on the Initial Closing
Date for the purpose of providing funds to the Lessor necessary to pay
Transaction Expenses, fees, expenses and other disbursements payable by
the Lessor under SECTION 9.1 of this Agreement, are subject to the
prior or contemporaneous satisfaction or waiver of the following
conditions precedent:
(i) the correctness in all material respects on
such date of the representations and warranties of the
Owner Trustee, the Construction Agent, the Lessee and the
Holders (other than such Holder) contained herein and in
each of the other Operative Agreements;
(ii) the performance in all material respects by
the Construction Agent and the Lessee of their respective
agreements contained herein and in the other Operative
Agreements which covenants are to be performed by them on
or prior to such date;
(iii) the satisfaction of all conditions to any
such Holder Funding or Loan set forth in any Operative
Agreement;
(iv) the Agent and the Owner Trustee shall have
received a fully executed copy of a counterpart of the
respective Requisition, appropriately completed; and
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(v) no Default or Event of Default under any of
the Operative Agreements shall have occurred after giving
effect to the Funding requested by such Requisition.
(b) The obligations of each Holder to make Holder Fundings,
and of each Lender to make Loans, to the Lessor on a Property Closing
Date for the purpose of providing funds to the Lessor necessary to pay
the Transaction Expenses, fees, expenses and other disbursements
payable by Lessor under SECTION 9.1 (B) of this Agreement and to
acquire a Property, are subject to the prior or contemporaneous
satisfaction or waiver of the following conditions precedent:
(i) the correctness in all material respects on
such Property Closing Date of the representations and
warranties of the Owner Trustee, the Construction Agent, the
Lessee and the Holders (other than such Holder) contained
herein and in each of the other Operative Agreements;
(ii) the performance in all material respects by
the Construction Agent and the Lessee of their respective
agreements contained herein and in the other Operative
Agreements which covenants are to be performed by them on or
prior to each such Property Closing Date;
(iii) the satisfaction of all conditions to any such
Holder Funding or Loan set forth in any Operative Agreement;
(iv) the Agent and the Owner Trustee shall have
received a fully executed copy of a counterpart of the
respective Requisition, appropriately completed;
(v) title to each Property being acquired on such
Property Closing Date shall conform to the representations and
warranties set forth in SECTION 8.1(C) hereof;
(vi) the Construction Agent shall have delivered to
the Lessor a copy of the Deed with respect to the Land and
existing Improvements (if any), a copy of the Ground Lease (if
any) with respect to the Land, and a copy of the ▇▇▇▇ of Sale
with respect to the Equipment, in each case for such of the
foregoing as are being acquired on such Property Closing Date;
and such Land and existing Improvements shall be located in an
Approved State;
(vii) there shall not have occurred and be
continuing any Default or Event of Default under any of the
Operative Agreements and no Default or Event of Default under
any of the Operative Agreements shall have occurred after
giving effect to the Funding requested by such Requisition;
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(viii) the Construction Agent shall have delivered to
the Agent and the Owner Trustee, title insurance commitments
to issue policies in favor of the Owner Trustee and the Agent
with respect to each Property being acquired on such Property
Closing Date, such policies being in form and substance
reasonably acceptable to the Owner Trustee and the Agent, with
such title exceptions thereto as are reasonably acceptable to
the Owner Trustee and the Agent; and the Construction Agent
shall deliver to the Owner Trustee and the Agent, as soon as
possible after such Property Closing Date, the final title
insurance policies for each such Property, taking no specific
exception for any Lien filed on account of materials furnished
or labor performed in connection with the Property, and
otherwise showing no additional exceptions to coverage;
(ix) the Construction Agent shall have delivered to
the Agent and the Owner Trustee a "Phase I" environmental site
assessment with respect to each such Property, prepared by an
independent recognized professional reasonably acceptable to
the Agent and the Owner Trustee and in a form and substance
that is reasonably acceptable to the Agent and the Owner
Trustee;
(x) the Construction Agent shall have delivered to
the Agent and the Owner Trustee a survey of each such
Property, prepared by an independent recognized professional
meeting the then current minimum standard detail requirements
for American Land Title Association/American Congress of
Surveying and Mapping (ALTA/ACSM) Land Title Surveys certified
to the Agent and otherwise reasonably acceptable to the Agent;
(xi) the Construction Agent shall have caused to be
delivered to the Agent and the Owner Trustee a legal opinion
(in form and substance reasonably satisfactory to the Agent
and the Owner Trustee) from counsel located in the state where
each such Property is located or, if the Agent and the Owner
Trustee have previously received an opinion from counsel in
such state, the Agent and the Owner Trustee (in their
discretion) may accept an update or a reaffirmation of the
previous opinion, in each case addressed to each Lender;
(xii) the Owner Trustee and the Agent shall be
satisfied, in their sole discretion, that the acquisition or
ground leasing of each such Property and the execution of the
Mortgage Instrument and the other Security Documents will not
adversely affect in any material respect the rights of the
Owner Trustee, the Holders, the Agent or the Lenders under or
with respect to the Operative Agreements in effect as of such
Property Closing Date (it being understood and acknowledged
that the Agent and the Owner Trustee may require that the
Construction Agent deliver an acceptable legal opinion in
connection with this condition);
(xiii) the Construction Agent shall have determined
(as set forth in the related Requisition) that such Property
is appropriate for its business operations;
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and the Agent shall have consented to the Lessor's acquisition
of such Property, which consent (subject to clause (xii)
above) shall not be unreasonably withheld or delayed;
(xiv) the Construction Agent shall have delivered to
the Agent and the Owner Trustee, respecting each such
Property, invoices for the various Transaction Expenses and
other fees, expenses and disbursements referenced in SECTION
9.1 (A) OR (B) of this Agreement;
(xv) the Lessor shall have delivered to the Agent a
Mortgage Instrument and Lender Financing Statements with
respect to each such Property in a form reasonably acceptable
to the Agent and Lessee;
(xvi) the Construction Agent shall have delivered to
the Lessor with respect to each such Property, a Lease
Supplement and a memorandum regarding the Lease and such Lease
Supplement (such memorandum to be substantially in the forms
attached to the Lease as Exhibit B and in each case in form
suitable for recording);
(xvii) the Construction Agent shall have delivered to
the Lessor with respect to each such Property Lessor Financing
Statements executed by the Lessee and the Lessor;
(xviii) if any such Property is subject to a Ground
Lease, the Construction Agent shall have caused a lease
memorandum (in form and substance satisfactory to the Agent)
to be delivered to the Agent for such Ground Lease;
(xix) counsel for the ground lessor of each such
Property subject to a Ground Lease shall have issued to the
Lessor, the Agent and the Holders, an opinion satisfactory to
the Agent;
(xx) all necessary (or in the reasonable opinion of
the Owner Trustee, the Agent, or their respective counsel,
advisable) Governmental Actions, in each case required by any
law or regulation enacted, imposed or adopted on or prior to
each such date or by any change in facts or circumstances on
or prior to each such date, shall have been obtained or made
and be in full force and effect;
(xxi) the Construction Agent shall cause (i) Uniform
Commercial Code lien searches, tax lien searches and judgment
lien searches regarding each of the Lessee and the Lessor to
be conducted (and copies thereof to be delivered to the Agent
and the Owner Trustee) in the state and county (or other
jurisdiction) in which such Property is located, by a
nationally recognized search company acceptable to the Owner
Trustee and the Agent and (ii) the liens referenced in such
lien searches which are objectionable to the Owner Trustee or
the Agent to be
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either removed or otherwise handled in a manner reasonably
satisfactory to the Owner Trustee and the Agent;
(xxii) the Agent shall have received an Appraisal for
such Property showing that such Property has a value at least
equal to ninety-three and one-half percent (93.5%) of the
expected total Property Cost of such Property and all
Improvements constructed or expected to be constructed thereon
(based on a Construction Budget satisfying the requirements of
SECTION 5.4(E)); and
(xxiii) all additional conditions to, and covenants
relating to, such Holder Fundings and Loans, as set forth in
Exhibits I and J attached hereto, shall have been fulfilled to
the satisfaction of the Agent. The terms of Exhibits I and J
are hereby incorporated by reference into this Agreement.
5.4. CONDITIONS TO THE HOLDERS' AND THE LENDERS' OBLIGATIONS TO MAKE
CONSTRUCTION FUNDINGS FOR THE COMMENCEMENT OF CONSTRUCTION OF ANY IMPROVEMENTS.
The obligations of each Holder to make Holder Fundings, and of each Lender to
make Loans, to the Lessor for the purpose of providing funds to the Lessor
necessary to pay the Transaction Expenses, fees, expenses and other
disbursements payable by Lessor under SECTION 9.1(B) of this Agreement, to make
an advance for the commencement of construction of any Improvements on a
Property and acquisition of Equipment, or to pay interest regarding the Loans
relating to a Property and to pay the Holder Yield regarding the Holder Fundings
relating to a Property, in each case regarding such interest and Holder Yield to
the extent accrued and payable under the Credit Agreement or Trust Agreement (as
the case may be), in each case during the period prior to the Completion Date
for such Property, are subject to the satisfaction or waiver of the following
conditions precedent:
(a) the correctness in all material respects on the date of
such Holder Fundings and Loans of the representations and warranties of
the Owner Trustee, the Construction Agent, the Lessee and the Holders
(other than such Holder) contained herein and in each of the other
Operative Agreements;
(b) the performance in all material respects by the
Construction Agent and the Lessee of their respective agreements
contained herein and in the other Operative Agreements and to be
performed by them on or prior to each such date;
(c) the satisfaction of all conditions to any such Holder
Funding or Loan set forth in any Operative Agreement;
(d) the Agent and the Owner Trustee shall have received a copy
of a fully executed counterpart of the respective Requisition
appropriately completed, together with copies of all Bills of Sale with
respect to any Equipment acquired as a part of any Improvements;
9
(e) with respect to each Initial Construction Funding, the
Agent and the Owner Trustee shall have received a copy of the
Construction Budget for the completion of the Improvements to which
such Funding relates, which Construction Budget shall indicate a total
Property Cost for such Improvements and the Land on which such
Improvements are to be constructed of not more than 106% of the
appraised value of such Property as set forth in the most recent
Appraisal thereof;
(f) with respect to each Initial Construction Funding, (i) the
title insurance commitments to issue policies (and any policies)
delivered in connection with the requirements of SECTION 5.3(B)(VIII)
shall be endorsed and down-dated (in a manner satisfactory to the
Agent) to provide insurance in an amount at least equal to the maximum
total Property Cost indicated by the Construction Budget referred to in
subparagraph (e) above (and in any event no less than the total actual
Property Cost after giving effect to such Funding), taking no specific
exception for any Lien filed on account of materials furnished or labor
performed in connection with the Property, and otherwise showing no
title change or any additional exceptions to coverage not approved by
the Agent; and (ii) all necessary recording fees, documentary stamp
taxes or similar amounts will be paid in connection with the related
Mortgage Instrument in an amount sufficient to cover such maximum total
Property Cost;
(g) there shall not have occurred and be continuing any
Default or Event of Default or under any of the Operative Agreements,
and no Default or Event of Default under any of the Operative
Agreements will have occurred after giving effect to the Funding
requested by such Requisition;
(h) with respect to each Initial Construction Funding, based
upon Construction Budgets which satisfy the requirements of
subparagraph (e) above, the Available Commitment and the Available
Holder Commitment (after deducting the Unfunded Amount) will be
sufficient to complete the Improvements;
(i) the Construction Agent shall have determined (as set forth
in the related Requisition) that such Improvements are appropriate to
its business; and the Agent shall have consented to such Improvements,
which consent shall not be unreasonably withheld or delayed; and
(j) all additional conditions to, and covenants relating to,
such Holder Fundings and Loans, as set forth in Exhibits I and J
attached hereto, shall have been fulfilled to the satisfaction of the
Agent. The terms of Exhibits I and J are hereby incorporated by
reference into this Agreement.
5.5. CONDITIONS TO THE HOLDERS' AND THE LENDERS' OBLIGATIONS TO MAKE
CONSTRUCTION FUNDINGS FOR THE ONGOING CONSTRUCTION ON ANY PROPERTY PRIOR TO THE
CONSTRUCTION PERIOD TERMINATION DATE. The obligations of each Holder to make
Holder Fundings, and of each Lender to make Loans, to the Lessor (i) in
connection with all subsequent requests for Fundings to pay the Transaction
Expenses, fees, expense and other disbursements payable by Lessor under SECTION
10
9.1(B) of this Agreement, (ii) to pay interest regarding the Loans relating to a
Property and to pay the Holder Yield regarding the Holder Fundings relating to a
Property, in each case regarding such interest and Holder Yield to the extent
accrued and payable under the Credit Agreement or Trust Agreement (as the case
may be), during the period prior to the Completion Date with respect to such
Property, and (iii) to pay for the construction of Improvements and acquisition
of Equipment with respect to any Property, in each case prior to the Completion
Date for such Property, are subject to the satisfaction or waiver of the
following conditions precedent:
(a) the correctness in all material respects on the date of
such Holder Fundings and Loans of the representations and warranties of
the Owner Trustee, the Construction Agent, the Lessee and the Holders
(other than such Holder) contained herein and in each of the other
Operative Agreements;
(b) the performance in all material respects by the
Construction Agent and the Lessee hereto of their respective agreements
contained herein and in the other Operative Agreements and to be
performed by them on or prior to each such date;
(c) the satisfaction of all conditions to any such Holder
Funding or Loan set forth in any Operative Agreements;
(d) the Agent and the Owner Trustee shall have received a copy
of a fully executed counterpart of the respective Requisition,
appropriately completed;
(e) there shall not have occurred and be continuing any
Default or Event of Default under any of the Operative Agreements, and
no Default or Event of Default under any of the Operative Agreements
will have occurred after giving effect to the Construction Funding
requested by such Requisition;
(f) (with respect to each Construction Funding) based upon
Construction Budgets which satisfy the requirements of SECTION 5.4(E)
of this Agreement, the Available Commitments and the Available Holder
Commitment (after deducting the Unfunded Amount) will be sufficient to
complete the Improvements;
(g) with respect to each Construction Funding, the title
insurance commitments to issue policies (or any policies) delivered in
connection with the requirements of SECTION 5.3(B)(III)) shall be
endorsed and down-dated (in a manner satisfactory to the Agent) to
provide insurance in an amount at least equal to the maximum total
Property Cost indicated by the Construction Budget referred to in
SECTION 5.4(E) (and in any event no less than the total actual Property
Cost after giving effect to such Funding), taking no specific exception
for any Lien filed on account of materials furnished or labor performed
in connection with the Property, and otherwise showing no title change
or any additional exceptions to coverage not approved by the Agent; and
(h) all additional conditions to, and covenants relating to,
such Holder Fundings and Loans, as set forth in Exhibits I and J
attached hereto, shall have been
11
fulfilled to the satisfaction of the Agent. The terms of Exhibits I and
J are hereby incorporated by reference into this Agreement.
5.6. REPORTING AND DELIVERY REQUIREMENTS ON COMPLETION DATE. On the
Completion Date for each Property, the Construction Agent shall deliver to the
Agent, and the Owner Trustee an Officer's Certificate in the form attached
hereto as EXHIBIT B specifying (a) the Completion Date for the construction of
Improvements at the Property, (b) the aggregate Property Cost for the Property
and (c) if any of the Property consists of Tangible Personal Property, a
separate statement of the Property Cost attributable to such Tangible Personal
Property. Such Officer's Certificate shall also include, in form and in detail
reasonably acceptable to the Agent and the Holders, a summary of the Property
Cost figures and a certification to the effect that all Improvements have been
made in accordance with all applicable material Legal Requirements, in a good
and workmanlike manner and otherwise in substantial compliance with the
standards and practices of the Construction Agent with respect to similar
properties and improvements owned by the Construction Agent, and that no consent
or approval of any Person is required for such Improvements except for consents
and approvals which have already been obtained. Furthermore, (i) on the
Completion Date for each Property, the Construction Agent shall deliver or cause
to be delivered originals of the following to the Agent (and copies thereof to
the Owner Trustee) each of which shall be in a form reasonably acceptable to the
Agent: (1) insurance certificates with respect to the Property as required under
the Lease Agreement, and (2) if requested by the Agent or the Owner Trustee,
amendments or modifications to the Lender Financing Statements or the Lessor
Financing Statements executed by the Lessee and the Lessor; and (ii) on or prior
to the Completion Date for each Property (and in no event later than the date of
the last Funding with respect to such Property, as set forth in Exhibit I), the
Construction Agent shall deliver or cause to be delivered originals of the
following to the Agent (and copies thereof to the Owner Trustee) each of which
shall be in a form reasonably acceptable to the Agent: (1) three copies of a
final as-built survey for the applicable Property, (2) an endorsement of the
title insurance policy regarding such Property, amending the effective date of
such policy to the date of such endorsement and taking no exception for any Lien
on account of materials furnished or labor performed in connection with the
Property, and otherwise showing no title changes or any additional exceptions to
coverage that have not been approved by the Agent, and (3) the final Plans and
Specifications for such Property. In addition, on the Completion Date for such
Property the Construction Agent covenants and agrees that the recording fees,
documentary stamp taxes or similar amounts paid or required to be paid in
connection with the related Mortgage Instrument shall be in an amount required
by applicable law. If such Property has been completed in accordance with the
Plans and Specifications (excluding immaterial punch list items) and the total
Property Cost of such Property as of the Completion Date (after giving effect to
any Fundings on such date) is less than the amount of Fundings estimated in the
Construction Budget for such Property (such shortfall not in excess of
$2,000,000 being referred to as the "Funding Shortfall"), then on any date on or
after the Completion Date, at the election of the Lessee, upon notice to the
Agent and the Lessor, (y) the Total Commitment and Total Holder Commitment shall
be permanently reduced (in accordance with the Operative Agreements) by an
aggregate amount (not in excess of $2,000,000) equal to the Funding Shortfall
(such reduction to be applied pro rata among the Commitments and Holder
Commitments), and (z) simultaneously with such
12
reduction in Commitments and Holder Commitments, the amount of the Letter of
Credit shall be reduced by an amount equal to the Funding Shortfall.
5.7. CONSTRUCTION AGENT DELIVERY OF ALLOCATION NOTICE AND CONSTRUCTION
BUDGET MODIFICATIONS. The Construction Agent covenants and agrees to deliver (i)
to the Agent at least five (5) Business Days before any Scheduled Interest
Payment Date during the Commitment Period the Allocation Notice referred to in
the first sentence of SECTION 2.3(B) of the Credit Agreement, and (ii) to the
Agent and the Owner Trustee each month any modification to any Construction
Budget regarding any Property; provided, no Construction Budget may be amended
unless (a) the title insurance policies referenced in SECTION 5.3(B)(VIII) are
also modified or endorsed, if necessary, to provide for insurance in an amount
that satisfies the requirements of SECTION 5.4(F)(I) of this Agreement and, if
necessary, any additional recording fees, documentary stamp taxes or similar
amounts paid in connection with the related Mortgage Instrument in an amount
sufficient to comply with the requirements of SECTION 5.4(F)(II), and (b) after
giving effect to any such amendment the Construction Budget remains in
compliance with the requirements of SECTION 5.4(E) of this Agreement. Any
amendment to the Construction Budget is also subject to the requirements of the
Agency Agreement.
5.8. INSPECTION OF DOCUMENTS; HOLD HARMLESS; REMOVAL OF PROPERTIES. Any
document or item (including without limitation any environmental report)
delivered to the Agent shall be available for inspection at any time during
ordinary business hours upon reasonable notice by any Lender or Holder. The
Agent shall not incur any liability to any Lender, any Holder, the Owner Trustee
or any other Person (and each Lender, each Holder, the Owner Trustee, the Lessee
and the Construction Agent hereby holds the Agent harmless from any such
liability) as a result of any such document or item, any information contained
therein, the failure to receive any such document, or the Agent's approval of
any Property. In the event the Majority Lenders determine that any environmental
site assessment reveals an Environmental Violation and they or the Agent so
notify the Lessee, then the Lessee shall remedy or purchase such Property in
accordance with SECTIONS 15.2, 16.1 AND 16.2 of the Lease, provided that if the
Property is a Construction Period Property, the Construction Agent shall be
responsible for such remedy or purchase.
SECTION 6. CONDITIONS OF THE INITIAL CLOSING.
6.1. CONDITIONS TO THE LESSOR'S AND THE HOLDERS' OBLIGATIONS. The
obligations of the Lessor and the Holders to consummate the transactions
contemplated by this Agreement, including the obligation to execute and deliver
the applicable Operative Agreements to which each is a party on the Initial
Closing Date, are subject to (i) the accuracy and correctness on the Initial
Closing Date of the representations and warranties of the other parties hereto
contained herein, (ii) the accuracy and correctness on the Initial Closing Date
of the representations and warranties of the other parties hereto contained in
any other Operative Agreement or certificate delivered pursuant hereto or
thereto, (iii) the performance by the other parties hereto of their respective
agreements contained herein and in the other Operative Agreements and to be
performed by them on or prior to the Initial Closing Date and (iv) the
satisfaction, or waiver by the Lessor and the Holders, of all of the following
conditions on or prior to the Initial Closing Date:
13
(a) Each of the Operative Agreements to be entered into as of
the Initial Closing Date shall have been duly authorized, executed and
delivered by the parties thereto, other than the Lessor or such Holder,
and shall be in full force and effect, and no Default or Event of
Default shall exist thereunder (both before and after giving effect to
the transactions contemplated by the Operative Agreements), and the
Lessor shall have received a fully executed copy of each of the
Operative Agreements (other than the Notes of which it shall have
received specimens). The Operative Agreements (or memoranda thereof),
any supplements thereto and any financing statements and fixture
filings in connection therewith required under the Uniform Commercial
Code shall have been filed or shall be promptly filed, if necessary, in
such manner as to enable the Lessee's counsel to render its opinion
referred to in SECTION 6.1(G) hereof;
(b) All taxes, fees and other charges in connection with the
execution, delivery, recording, filing and registration of the
Operative Agreements shall have been paid or provision for such payment
shall have been made to the reasonable satisfaction of the Lessor and
the Agent;
(c) No action or proceeding shall have been instituted, nor
shall any action or proceeding be threatened, before any Governmental
Authority, nor shall any order, judgment or decree have been issued or
proposed to be issued by any Governmental Authority (i) to set aside,
restrain, enjoin or prevent the full performance of this Agreement, any
other Operative Agreement or any transaction contemplated hereby or
thereby or (ii) which is reasonably likely to have a Material Adverse
Effect;
(d) In the reasonable opinion of the Lessor and the Holders
and their counsel, the transactions contemplated by the Operative
Agreements do not and will not violate any material Legal Requirements
and do not and will not subject the Lessor or the Holders to any
materially adverse regulatory prohibitions or constraints;
(e) The Lessor and the Agent shall each have received an
Officer's Certificate of the Lessee, dated as of the Initial Closing
Date, in the form attached hereto as EXHIBIT D or in such other form as
is reasonably acceptable to such parties stating that (i) each and
every representation and warranty of the Lessee contained in the
Operative Agreements to which it is a party is true and correct in all
material respects on and as of the Initial Closing Date; (ii) no
Default or Event of Default has occurred and is continuing under any
Operative Agreement; (iii) each Operative Agreement to which Lessee is
a party is in full force and effect with respect to it; and (iv) the
Lessee has performed and complied with all covenants, agreements and
conditions contained herein or in any Operative Agreement required to
be performed or complied with by it on or prior to the Initial Closing
Date;
(f) The Lessor and the Agent shall each have received (i) a
certificate of the Secretary or an Assistant Secretary of each of the
Lessee and each Guarantor in the form attached hereto as EXHIBIT E or
in such other form as is reasonably acceptable to such parties
attaching and certifying as to (A) the resolutions of the Board of
Directors of Lessee or such Guarantor (as the case may be) duly
authorizing the execution, delivery
14
and performance by Lessee or such Guarantor (as the case may be) of
each of the Operative Agreements to which it is or will be a party, (B)
its certificate of incorporation and by-laws, in each case certified as
of a recent date by the Secretary of State of the State of its
incorporation, and (C) the incumbency and signature of persons
authorized to execute and deliver on its behalf the Operative
Agreements to which it is a party and (ii) a good standing certificate
from the appropriate officer of each state in which it is required to
be qualified to do business as to its good standing in such state;
(g) Counsel for the Lessee and the Guarantors reasonably
acceptable to the other parties hereto shall have issued to the Lessor,
the Agent, the Lenders and the Holders an opinion in the form attached
hereto as EXHIBIT C or in such other form as is reasonably acceptable
to such parties; and
(h) As of the Initial Closing Date, there shall not have
occurred any material adverse change in the consolidated assets,
liabilities, operations, business or financial condition of the Lessee
from that set forth in the audited financial statements of the Lessee
dated December 31, 1997.
6.2. CONDITIONS TO THE LESSEE'S OBLIGATIONS. The obligation of the
Lessee to consummate the transactions contemplated by this Agreement, including
the obligation to execute and deliver the Operative Agreements to which it is a
party as of the Initial Closing Date, is subject to (i) the accuracy and
correctness on the Initial Closing Date of the representations and warranties of
the other parties hereto contained herein, (ii) the accuracy and correctness on
the Initial Closing Date of the representations and warranties of the other
parties hereto contained in any other Operative Agreement or certificate
delivered pursuant hereto or thereto, (iii) the performance by the other parties
hereto of their respective agreements contained herein and in the other
Operative Agreements, in each case to be performed by them on or prior to the
Initial Closing Date, and (iv) the satisfaction or waiver by the Lessee of all
of the following conditions on or prior to the Initial Closing Date:
(a) Each of the Operative Agreements to be entered into as of
the Initial Closing Date shall have been duly authorized, executed and
delivered by the parties thereto, other than the Lessee, and shall be
in full force and effect, and no Default, other than Defaults of the
Lessee, shall exist thereunder, and the Lessee shall have received a
fully executed copy of each of the Operative Agreements (other than
Notes of which it shall have received a specimen);
(b) In the reasonable opinion of the Lessee and its counsel,
the transactions contemplated by the Operative Agreements do not
violate any material Legal Requirements and will not subject Lessee to
any materially adverse regulatory prohibitions or constraints;
(c) No action or proceeding shall have been instituted nor
shall any action or proceeding be threatened, before any Governmental
Authority, nor shall any order, judgment or decree have been issued or
proposed to be issued by any Governmental
15
Authority (i) to set aside, restrain, enjoin or prevent the full
performance of this Agreement, any other Operative Agreement or any
transaction contemplated hereby or thereby or (ii) which is reasonably
likely to have a Material Adverse Effect;
(d) The Lessee and the Agent shall each have received an
Officer's Certificate of the Lessor dated as of such Closing Date in
the form attached hereto as EXHIBIT F or in such other form as is
reasonably acceptable to Lessee and the Agent, stating that (i) each
and every representation and warranty of the Lessor contained in the
Operative Agreements to which it is a party is true and correct on and
as of the Initial Closing Date; (ii) each Operative Agreement to which
the Lessor is a party is in full force and effect with respect to it,
and (iii) the Lessor has duly performed and complied with all
covenants, agreements and conditions contained herein or in any
Operative Agreement required to be performed or complied with by it on
or prior to the Initial Closing Date;
(e) The Lessee and the Agent shall each have received (i) a
certificate of the Secretary, an Assistant Secretary, Trust Officer or
Vice President of the Trust Company in the form attached hereto as
EXHIBIT G or in such other form as is reasonably acceptable to Lessee
and the Agent, attaching and certifying as to (A) the signing
resolutions, (B) its articles of incorporation or other equivalent
charter documents, as the case may be, certified as of a recent date by
an appropriate officer of the Trust Company, (C) its by-laws and (D)
the incumbency and signature of persons authorized to execute and
deliver on its behalf the Operative Agreements to which it is a party
and (ii) a good standing certificate from the state of incorporation of
the Trust Company; and
(f) Counsel for the Lessor acceptable to the other parties
hereto shall have issued to the Lessee, the Holders, the Lenders and
the Agent an opinion in the form attached hereto as EXHIBIT H or in
such other form as is reasonably acceptable to such parties.
6.3. CONDITIONS TO THE AGENT'S OBLIGATIONS. The obligation of the Agent
to consummate the transactions contemplated by this Agreement, including the
obligation to execute and deliver each of the Operative Agreements to which it
is a party as of the Initial Closing Date, is subject to (i) the accuracy and
correctness on the Initial Closing Date of the representations and warranties of
the other parties hereto contained herein, (ii) the accuracy and correctness on
the Initial Closing Date of the representations and warranties of the other
parties hereto contained in any other Operative Agreement or certificate
delivered pursuant hereto or thereto, (iii) the performance by the other parties
hereto of their respective agreements contained herein and in the other
Operative Agreements, in each case to be performed by them on or prior to the
Initial Closing Date, and (iv) the satisfaction, or waiver by the Agent, of all
of the following conditions on or prior to the Initial Closing Date:
(a) Each of the Operative Agreements to be entered into as of
the Initial Closing Date shall have been duly authorized, executed and
delivered by the parties thereto, other than the Agent, and shall be in
full force and effect, and no Default or Event of Default shall exist
thereunder (both before and after giving effect to the transactions
16
contemplated by the Operative Agreements), and the Agent shall have
received a fully executed copy of each of the Operative Agreements
(including the Notes). The Operative Agreements (or memoranda thereof),
any supplements thereto and any financing statements and fixture
filings in connection therewith required under the Uniform Commercial
Code shall have been filed or shall be promptly filed, if necessary, in
such manner as to enable the Lessor's counsel to render its opinion
referred to in SECTION 6.2(F) hereof;
(b) The satisfaction of each of the conditions set forth in
SECTIONS 6.1(B), (C), (E), (F) AND (H) and SECTIONS 6.2(D), (E) AND (F)
hereof; and
(c) In the reasonable opinion of the Agent and its counsel,
the transactions contemplated by the Operative Agreements do not and
will not violate any material Legal Requirements and do not and will
not subject the Agent to any materially adverse regulatory prohibitions
or constraints.
SECTION 7. REPRESENTATIONS AND WARRANTIES ON THE INITIAL
CLOSING DATE.
7.1. REPRESENTATIONS AND WARRANTIES OF THE INITIAL HOLDERS. Effective
as of the Initial Closing Date, each Holder on such date represents and warrants
to each of the other parties hereto that:
(a) It is a national banking association, or a corporation
that is a commercial finance company, in each case duly organized,
validly existing and in good standing under the laws of the United
States or the country or state of its organization and has the power
and authority to carry on its business as now conducted and to enter
into and perform its obligations under each Operative Agreement to
which it is or will be a party and each other agreement, instrument and
document to be executed and delivered by it on or before each Closing
Date in connection with or as contemplated by each such Operative
Agreement to which it is or will be a party;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party have been duly authorized
by all necessary action on its part and neither the execution and
delivery thereof, nor the consummation of the transactions contemplated
thereby, nor compliance by it with any of the terms and provisions
thereof (i) requires or will require any approval of the stockholders
of, or approval or consent of any trustee or holder of any indebtedness
or obligations of, such Holder which have not been obtained and in full
force and effect, (ii) violates or will violate any Legal Requirement
applicable to or binding on it (except no representation or warranty is
made as to any Legal Requirement to which it may be subject solely as a
result of the activities of the Lessee) as of the date hereof, (iii)
violates or will violate or result in any breach of or constitute any
default under, or result in the creation of any Lien upon any Property
or any of the Improvements (other than Liens created by the Operative
Agreements) under its certificate of incorporation or other equivalent
charter documents, or any indenture,
17
mortgage, chattel mortgage, deed of trust, conditional sales contract,
bank loan or credit agreement or other agreement or instrument to which
it is a party or by which it or its properties is bound or affected or
(iv) requires or will require any Governmental Action by any
Governmental Authority (other than arising solely by reason of the
business, condition or activities of the Lessee or any Affiliate
thereof or the construction or use of the Properties or the
Improvements);
(c) This Agreement and each other Operative Agreement to which
it is or will be a party have been, or will be, duly executed and
delivered by it and constitute, or upon execution and delivery will
constitute, a legal, valid and binding obligation enforceable against
it in accordance with the terms thereof, subject to the effect of any
applicable bankruptcy, moratorium, insolvency, reorganization or other
similar laws affecting the enforceability of creditors' rights
generally and to the effect of general principles of equity (whether
considered in a proceeding at law or in equity);
(d) There is no action or proceeding pending or, to its
knowledge, threatened against it before any Governmental Authority that
questions the validity or enforceability of any Operative Agreement to
which it is or will become a party or that, if adversely determined,
would materially and adversely affect its ability to perform its
obligations under the Operative Agreements to which it is a party;
(e) It has not assigned or transferred any of its right, title
or interest in or under the Lease except in accordance with the
Operative Agreements;
(f) No Default or Event of Default under the Operative
Agreements attributable to it has occurred and is continuing;
(g) It is not a "holding company" or a "subsidiary company" of
a "holding company" or an "affiliate" of a "holding company" or a
"public utility" within the meaning of the Public Utility Holding
Company Act of 1935, as amended, or a "public utility" within the
meaning of the Federal Power Act, as amended. It is not an "investment
company" or a company "controlled" by an "investment company" within
the meaning of the Investment Company Act or an "investment adviser"
within the meaning of the Investment Advisers Act of 1940, as amended;
and
(h) It is acquiring its interest in the Trust Estate for its
own account for investment and not with a view to any distribution (as
such term is used in Section 2(11) of the Securities Act) thereof, and
if in the future it should decide to dispose of its interest in the
Trust Estate, it understands that it may do so only in compliance with
the Securities Act and the rules and regulations of the Securities and
Exchange Commission thereunder and any applicable state securities
laws. Neither it nor anyone authorized to act on its behalf has taken
or will take any action which would subject, as a direct result of such
action alone, the issuance or sale of any interest in any Property, the
Trust Estate or the Lease to the registration requirements of Section 5
of the Securities Act. No representation or warranty contained in this
SECTION 7.1(I) shall include or cover any
18
action or inaction of the Lessee or any Affiliate thereof whether or
not purportedly on behalf of the Holders, the Owner Trustee or any of
their Affiliates.
7.2. REPRESENTATIONS AND WARRANTIES OF THE OWNER TRUSTEE. Effective as
of the Initial Closing Date, Trust Company in its individual capacity and as the
Owner Trustee, as indicated, represents and warrants to each of the other
parties hereto as follows, provided, that the representations in paragraphs (h),
(i), (j) and (k) below are made solely in its capacity as the Owner Trustee:
(a) It is a national banking association duly organized,
validly existing and in good standing under the laws of the United
States of America and has the power and authority to enter into and
perform its obligations under the Trust Agreement and (assuming due
authorization, execution and delivery of the Trust Agreement by the
Holders) has the corporate and trust power and authority to act as the
Owner Trustee and to enter into and perform the obligations under each
of the other Operative Agreements to which Trust Company or the Owner
Trustee, as the case may be, is or will be a party and each other
agreement, instrument and document to be executed and delivered by it
on or before each Closing Date in connection with or as contemplated by
each such Operative Agreement to which Trust Company or the Owner
Trustee, as the case may be, is or will be a party;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party, either in its individual
capacity or (assuming due authorization, execution and delivery of the
Trust Agreement by the Holders) as the Owner Trustee, as the case may
be, has been duly authorized by all necessary action on its part and
neither the execution and delivery thereof, nor the consummation of the
transactions contemplated thereby, nor compliance by it with any of the
terms and provisions thereof (i) requires or will require any approval
of its stockholders, or any approval or consent of any trustee or
holders of any of its indebtedness or obligations, (ii) violates or
will violate any current law, governmental rule or regulation relating
to its banking or trust powers, (iii) violates or will violate or
result in any breach of or constitute any default under, or result in
the creation of any Lien upon any of its property under, (A) its
charter or by-laws, or (B) any indenture, mortgage, chattel mortgage,
deed of trust, conditional sales contract, bank loan or credit
agreement or other agreement or instrument to which it is a party or by
which it or its properties may be bound or affected, which violation,
breach, default or Lien under clause (B) would materially and adversely
affect its ability, in its individual capacity or as Owner Trustee, to
perform its obligations under the Operative Agreements to which it is a
party or (iv) requires or will require any Governmental Action by any
Governmental Authority regulating its banking or trust powers;
(c) The Trust Agreement and, assuming the Trust Agreement is
the legal, valid and binding obligation of the Holders, each other
Operative Agreement to which the Trust Company or the Owner Trustee, as
the case may be, is or will be a party have been, or will be, duly
executed and delivered by Trust Company or the Owner Trustee, as the
case may
19
be, and the Trust Agreement and each such other Operative Agreement to
which Trust Company or the Owner Trustee, as the case may be, is a
party constitutes, or upon execution and delivery will constitute, a
legal, valid and binding obligation enforceable against Trust Company
or the Owner Trustee, as the case may be, in accordance with the terms
thereof;
(d) There is no action or proceeding pending or, to its
knowledge, threatened to which it is or will be a party, either in its
individual capacity or as the Owner Trustee, before any Governmental
Authority that, if adversely determined, would materially and adversely
affect its ability, in its individual capacity or as Owner Trustee, to
perform its obligations under the Operative Agreements to which it is a
party or would question the validity or enforceability of any of the
Operative Agreements to which it is or will become a party;
(e) It has not assigned or transferred any of its right, title
or interest in or under the Lease or the Agency Agreement except in
accordance with the Operative Agreements;
(f) No Default or Event of Default under the Operative
Agreements attributable to it has occurred and is continuing;
(g) Neither the Owner Trustee nor any Person authorized by the
Owner Trustee to act on its behalf has offered or sold any interest in
the Trust Estate or the Notes, or in any similar security relating to a
Property, or in any security the offering of which for the purposes of
the Securities Act would be deemed to be part of the same offering as
the offering of the aforementioned securities to, or solicited any
offer to acquire any of the same from, any Person other than, in the
case of the Notes, the Lenders, and neither the Owner Trustee nor any
Person authorized by the Owner Trustee to act on its behalf will take
any action which would subject, as a direct result of such action
alone, the issuance or sale of any interest in the Trust Estate or the
Notes to the provisions of Section 5 of the Securities Act, or require
the qualification of any Operative Agreement under the Trust Indenture
Act of 1939, as amended;
(h) The Owner Trustee's chief place of business, chief
executive office and office where the documents, accounts and records
relating to the transactions contemplated by this Agreement and each
other Operative Agreement are kept are located at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇;
(i) The Owner Trustee is not engaged principally in, and does
not have as one of its important activities, the business of extending
credit for the purpose of purchasing or carrying any margin stock
(within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System of the United States), and no part of the
proceeds of the Loans or the Holder Fundings will be used by it to
purchase or carry any margin stock or to extend credit to others for
the purpose of purchasing or carrying any such margin stock
20
or for any purpose that violates, or is inconsistent with, the
provisions of Regulations T, U, or X of the Federal Reserve Board; and
(j) The Owner Trustee is not a "holding company" or a
"subsidiary company" of a "holding company" or an "affiliate" of a
"holding company" or a "public utility" within the meaning of the
Public Utility Holding Company Act of 1935, as amended, or a "public
utility" within the meaning of the Federal Power Act, as amended. The
Owner Trustee is not an "investment company" or a company "controlled"
by an "investment company" within the meaning of the Investment Company
Act or an "investment adviser" within the meaning of the Investment
Advisers Act of 1940, as amended.
7.3. REPRESENTATIONS AND WARRANTIES OF THE CONSTRUCTION AGENT AND THE
LESSEE. Effective as of the Initial Closing Date, Construction Agent and the
Lessee represent and warrant to each of the other parties hereto that:
(a) Each of the Construction Agent and the Lessee is a
corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware; each of their Subsidiaries is listed
on Schedule 5 hereto and each is duly organized and validly existing
under the laws of the jurisdiction of its organization; and each of the
Construction Agent and the Lessee and each of their Subsidiaries is
duly qualified to do business in each other jurisdiction where the
nature of its business makes such qualification necessary, except where
such failure to so qualify would not have a Material Adverse Effect.
Each of the Construction Agent, the Lessee and each of their
Subsidiaries has the power and authority to carry on its business as
now conducted and to enter into and perform its obligations under each
Operative Agreement to which it is or will be a party and each other
agreement, instrument and document to be executed and delivered by it
on or before each Closing Date in connection with or as contemplated by
each such Operative Agreement to which it is or will be a party;
(b) The execution, delivery and performance by each of the
Construction Agent, the Lessee and any of their Subsidiaries of this
Agreement and the other Operative Agreements to which each is or will
be a party have been duly authorized by all necessary corporate action
on the part of each of the Construction Agent, the Lessee and each such
Subsidiary (including any necessary shareholder action), have received
all necessary governmental approval, and do not and will not (i)
violate any Legal Requirement, decree, judgment or award which is
applicable to or binding on the Construction Agent or the Lessee or any
of their Subsidiaries, (ii) violate or conflict with, or result in a
breach of, any provision of the Certificate of Incorporation, By-Laws
or other organizational documents of either the Construction Agent or
the Lessee or any of their Subsidiaries, or any indenture, mortgage,
chattel mortgage, deed of trust, conditional sales contract, bank loan,
credit agreement or other agreement, instrument or document to which
either the Construction Agent or the Lessee or any of their
Subsidiaries is a party or which is binding on either the Construction
Agent or the Lessee or any of their Subsidiaries or any of their
respective properties, or (iii) result in, or require, the creation or
imposition of any Lien
21
(other than pursuant to the terms of the Operative Agreements) on any
asset of either of the Construction Agent or the Lessee or any of their
Subsidiaries;
(c) Each of this Agreement and each other Operative Agreement
to which the Construction Agent, the Lessee or any of their
Subsidiaries is or will be a party has been, or will be, duly executed
and delivered by it and constitutes, or upon execution and delivery
will constitute, the legal, valid or binding obligation of the
Construction Agent, the Lessee or such Subsidiary, as the case may be,
enforceable against it in accordance with the terms thereof, subject to
the effect of any applicable bankruptcy, moratorium, insolvency,
reorganization or other similar laws affecting the enforceability of
creditors' rights generally and to the effect of general principles of
equity (whether considered in a proceeding at law or in equity). The
Construction Agent, the Lessee and each of their Subsidiaries have each
executed the various Operative Agreements required to be executed as of
the Initial Closing Date;
(d) There are no actions, suits or proceedings (including,
without limitation, any derivative action) pending or, to the knowledge
of either the Construction Agent or the Lessee, threatened with respect
to the Construction Agent or Lessee or any of their Subsidiaries which,
if adversely decided, are reasonably likely to result, either
individually or collectively, in a Material Adverse Effect. None of the
Construction Agent, the Lessee nor any of their Subsidiaries has any
material contingent liabilities not provided for or disclosed in the
financial statements referred to in SECTION 7.3(F), which are required
in accordance with GAAP to be reported in such financial statements;
(e) No Governmental Action by any Governmental Authority or
authorization, registration, consent, approval, waiver, notice or other
action by, to or of any other Person is required to authorize or is
required in connection with (i) the execution, delivery or performance
of any Operative Agreement or (ii) the legality, validity, binding
effect or enforceability of any Operative Agreement, in each case,
except those which have been obtained and are in full force and effect;
(f) (i) The audited consolidated financial statements of each
of the Construction Agent and the Lessee as at December 31, 1997,
copies of which have been furnished to the Agent and the Owner Trustee,
were prepared in accordance with GAAP and fairly present the financial
condition of each of the Construction Agent and the Lessee and their
Subsidiaries on a consolidated basis as of such date and their
consolidated results of operations for the fiscal year then ended and
(ii) the unaudited consolidated financial statements as at September
30, 1998, copies of which have been furnished to the Agent and the
Owner Trustee, were prepared in accordance with GAAP (subject to normal
year-end adjustments) and fairly present the financial condition of the
Construction Agent and the Lessee and their Subsidiaries on a
consolidated basis as of such date and their consolidated results of
operations for the fiscal year then ended and such two-quarter period,
respectively;
22
(g) Since the date of the audited financial statements
described in SECTION 7.3(F)(I), there has been no event or occurrence
which has had or is reasonably likely to have a Material Adverse
Effect;
(h) Neither the Construction Agent nor the Lessee knows of any
proposed material tax assessments against it or any of its
Subsidiaries. No extension of time for assessment or payment of any
material federal, state or local tax by either the Construction Agent
or the Lessee or any of their Subsidiaries is in effect;
(i) ERISA.
(A) None of the employee benefit plans maintained at
any time by the Construction Agent or the Lessee or any of
their Subsidiaries or the trusts created thereunder has
engaged in a prohibited transaction which could subject any
such employee benefit plan or trust to a material tax or
penalty on prohibited transactions imposed under Code Section
4975 or ERISA;
(B) None of the employee benefit plans maintained at
any time by the Construction Agent or the Lessee or any of
their Subsidiaries which are employee pension benefit plans
and which are subject to Title IV of ERISA or the trusts
created thereunder has been terminated nor has any such
employee benefit plan of the Construction Agent or Lessee or
any of their Subsidiaries incurred any liability to the PBGC,
other than for required insurance premiums which have been
paid; neither the Construction Agent nor the Lessee or any of
their Subsidiaries has withdrawn from or caused a partial
withdrawal to occur with respect to any Multi-employer Plan;
the Construction Agent, the Lessee and their Subsidiaries have
made or provided for all contributions to all such employee
pension benefit plans which they maintain and which are
required as of the end of the most recent fiscal year under
each such plan; neither the Construction Agent nor the Lessee
or any of their Subsidiaries has incurred any accumulated
funding deficiency with respect to any such plan, whether or
not waived; nor has there been any reportable event, or other
event or condition, which presents a material risk of
termination of any such employee benefit plan by the PBGC;
(C) The present value of all vested accrued benefits
under the employee pension benefit plans which are subject to
Title IV of ERISA, maintained by the Construction Agent, the
Lessee or any of their Subsidiaries, did not, as of the most
recent valuation date for each such plan, exceed the then
current value of the assets of such employee benefit plans
allocable to such benefits;
(D) The consummation of the transactions contemplated
by the Operative Agreements will not involve any prohibited
transaction under ERISA;
(E) To the best of the Construction Agent's and the
Lessee's knowledge, each employee pension benefit plan subject
to Title IV of ERISA,
23
maintained by the Construction Agent, the Lessee, or any of
their Subsidiaries, has been administered in accordance with
its terms and is in compliance in all material respects with
all applicable requirements of ERISA and other applicable
laws, regulations and rules;
(F) There has been no withdrawal liability incurred
with respect to any Multi-employer Plan to which the
Construction Agent, the Lessee or any of their Subsidiaries is
or was a contributor;
(G) As used in this Agreement, the terms "employee
benefit plan," "employee pension benefit plan," "accumulated
funding deficiency," "reportable event," and "accrued
benefits" shall have the respective meanings assigned to them
in ERISA, and the term "prohibited transaction" shall have the
meaning assigned to it in Code Section 4975 and ERISA;
(H) Neither the Construction Agent nor the Lessee or
any of their Subsidiaries has any liability, contingent or
otherwise, under any plan or program or the equivalent for
unfunded post-retirement benefits, including pension, medical
and death benefits, which liability would have a Material
Adverse Effect;
(j) Upon the execution and delivery of each Lease Supplement
to the Lease, (i) the Lessee will have unconditionally accepted the
Property subject to the Lease Supplement and will have a valid and
subsisting leasehold interest in the Property, subject only to the
Permitted Exceptions, and (ii) no offset will exist with respect to any
Rent or other sums payable under the Lease;
(k) Neither the Construction Agent nor the Lessee or any of
their Subsidiaries has filed a voluntary petition in bankruptcy or been
adjudicated bankrupt or insolvent, or filed any petition or answer
seeking any reorganization, liquidation, receivership, dissolution or
similar relief under any bankruptcy, receivership, insolvency, or other
law relating to relief for debtors, or sought or consented to or
acquiesced in the appointment of any trustee, receiver, conservator or
liquidator of all or any part of its properties or its interest in any
Property. No court of competent jurisdiction has entered an order,
judgment, or decree approving a petition filed against the Construction
Agent, the Lessee or any of their Subsidiaries seeking any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief under any federal or state bankruptcy,
receivership, insolvency or other law relating to relief for debtors,
and no other liquidator has been appointed for the Construction Agent,
the Lessee or any of their Subsidiaries or all or any part of its
properties or its interest in any Property, and no such action is
pending. Neither the Construction Agent nor the Lessee or any of their
Subsidiaries has given notice to any Governmental Authority or any
Person of insolvency or pending insolvency, or suspension or pending
suspension of operations;
24
(l) Each of the Construction Agent, the Lessee and their
Subsidiaries owns marketable title to, or a subsisting leasehold
interest in, all of its Properties free and clear of all Liens, except
Permitted Liens;
(m) Neither the Construction Agent, the Lessee nor any of
their Subsidiaries is (a) an "investment company" or a company
"controlled" by an "investment company", within the meaning of the
Investment Company Act or an "investment adviser" within the meaning of
the Investment Advisers Act of 1940, as amended, or (b) a "holding
company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company", or a "public utility", within the meaning of the
Public Utility Holding Company Act of 1935, as amended, or a "public
utility" within the meaning of the Federal Power Act, as amended;
(n) Neither the Construction Agent, the Lessee nor any of
their Subsidiaries is engaged principally in, or has as one of its
important activities, the business of extending credit for the purpose
of purchasing or carrying any margin stock (within the meaning of
Regulation U of the Federal Reserve Board), and no part of the proceeds
of the Loans or the Holder Fundings will be used for the purpose,
whether immediate, incidental or ultimate, of purchasing or carrying
any margin stock or maintaining or extending credit to others for such
purpose, or for any purpose that violates, or is inconsistent with
Regulations T, U, or X of the Federal Reserve Board;
(o) Each of the Construction Agent, the Lessee and their
Subsidiaries has filed all material tax returns and reports required by
Law to have been filed by it and has paid all Taxes and governmental
charges thereby shown to be owing, except any such Taxes or charges
which are being diligently contested in good faith by appropriate
proceedings and for which adequate reserves shall in accordance with
GAAP have been set aside on its books;
(p) To the best of the knowledge of each of the Construction
Agent and the Lessee, after inquiry it has deemed appropriate, each of
the Construction Agent, the Lessee and their Subsidiaries is in
material compliance with all Environmental Laws and Occupational Safety
and Health Laws where failure to comply could have a Material Adverse
Effect. None of the Construction Agent, the Lessee nor any of their
Subsidiaries has received notice of any claims that any of them is not
in compliance in all material respects with any Environmental Law where
failure to comply could have a Material Adverse Effect;
(q) Each of the Construction Agent, the Lessee and their
Subsidiaries is in compliance with all statutes, judicial and
administrative orders, permits and governmental rules and regulations
which are material to its business or the non-compliance with which
could result in Material Adverse Result;
(r) All information heretofore or contemporaneously herewith
furnished by either the Construction Agent or the Lessee or any of
their Subsidiaries to the Agent, the
25
Owner Trustee, any Lender or any Holder for purposes of or in
connection with this Agreement and the transactions contemplated hereby
is, and all information hereafter prepared and furnished by the
Construction Agent, the Lessee or any of their Subsidiaries to the
Agent, the Owner Trustee, any Lender or any Holder pursuant hereto or
in connection herewith will be, true and accurate in every material
respect on the date as of which such information is dated or certified,
and such information, taken as a whole, does not and will not omit to
state any material fact necessary to make such information, taken as a
whole, not misleading;
(s) WETLANDS. Except as listed on Schedule 7.3(s) there are no
wetlands, tidelands or swamp or overflow lands on any Property;
(t) ON-SITE AND OFF-SITE CONDITIONS. Except as listed on
Schedule 7.3(t), there is no condition arising from or affecting any
Property or arising from or affecting any lands nearby or adjacent to
any Property that is having or is reasonably likely to have a
significant adverse effect upon human health or the environment at such
Property or upon the use or value of such Property; and
(u) CONDEMNATION. The Lessee and the Construction Agent have
done the proper due diligence to determine, and have determined, that
there is no reasonable likelihood that any Property will be condemned,
taken by eminent domain or otherwise taken by any Governmental
Authority.
7.4. REPRESENTATIONS AND WARRANTIES OF THE AGENT. Effective as of the
Initial Closing Date, the Agent represents and warrants to each of the other
parties hereto that:
(a) It is a national banking association duly organized and
validly existing under the laws of the United States of America and has
the full power and authority to enter into and perform its obligations
under this Agreement and each other Operative Agreement to which it is
or will be a party;
(b) The execution, delivery and performance by the Agent of
this Agreement and each other Operative Agreement to which it is or
will be a party are not, and will not be, inconsistent with the
articles of incorporation or by-laws or other charter documents of the
Agent, do not and will not contravene any applicable Law of the State
of Florida or of the United States of America governing its activities
and will not contravene any provision of, or constitute a default under
any indenture, mortgage, contract or other instrument to which it is a
party or by which it or its properties are bound, or require any
consent or approval of any Governmental Authority under any applicable
law, rule or regulation of the State of Florida or any federal law,
rule or regulation of the United States of America governing its
activities; and
(c) Each of this Agreement and each other Operative Agreement
to which it is a party has been, or when executed and delivered will
be, duly authorized by all necessary corporate action on the part of
the Agent and has been, or on such Closing Date will be,
26
duly executed and delivered by the Agent and, assuming the due
authorization, execution and delivery hereof and thereof by the other
parties hereto and thereto, will constitute a legal, valid and binding
obligation enforceable against the Agent in accordance with the terms
thereof.
SECTION 8. REPRESENTATIONS AND WARRANTIES ON FUNDING DATES.
8.1. REPRESENTATIONS AND WARRANTIES ON PROPERTY CLOSING DATES. The
Construction Agent and the Lessee hereby represent and warrant as of each
Property Closing Date as follows:
(a) The representations and warranties of the Construction
Agent and the Lessee set forth in the Operative Agreements (including
without limitation the representations and warranty set forth in
SECTION 7 of this Agreement) are true and correct in all material
respects on and as of such Property Closing Date as if made on and as
of such date. The Construction Agent, the Lessee and their Subsidiaries
are in all material respects in compliance with their respective
obligations under the Operative Agreements and there exists no Default
or Event of Default under any of the Operative Agreements. No Default
or Event of Default will occur under any of the Operative Agreements as
a result of, or after giving effect to, the Funding requested by the
Requisition on such Property Closing Date;
(b) The Properties to be acquired are being acquired at a
price that is not in excess of fair market value and such Properties
consist of (i) unimproved Land, or (ii) Land and existing Improvements
thereon which Improvements are either suitable for occupancy at the
time of acquisition or will be renovated or modified in accordance with
the terms of this Agreement, or (iii) Equipment. Each of the Properties
is located at the site set forth on the applicable Requisition, which
is in one of the Approved States;
(c) Upon the acquisition of each Property on such Property
Closing Date, and at all times thereafter, the Lessor will have
marketable title to such Property, subject only to Permitted
Exceptions;
(d) The execution and delivery of each Operative Agreement
delivered by the Construction Agent, the Lessee or any of their
subsidiaries on such Property Closing Date and the performance of the
obligations of the Construction Agent, the Lessee and each of their
subsidiaries under each Operative Agreement have been duly authorized
by all requisite corporate action of the Construction Agent or the
Lessee, as applicable;
(e) Each Operative Agreement delivered on such Property
Closing Date by the Construction Agent, the Lessee or any of their
subsidiaries has been duly executed and delivered by the Construction
Agent, the Lessee or such subsidiary;
(f) Each Operative Agreement delivered by the Construction
Agent, the Lessee or any of their Subsidiaries on such Property Closing
Date is a legal, valid and binding obligation of the Construction
Agent, the Lessee or such Subsidiary, as applicable,
27
enforceable against the Construction Agent, the Lessee or such
Subsidiary, as applicable, in accordance with its respective terms,
subject to the effect of any applicable bankruptcy, moratorium,
insolvency, reorganization or other similar laws affecting the
enforceability of creditors' rights generally and to the effect of
general principles of equity (whether considered in a proceeding at law
or in equity);
(g) Upon filing of each of the UCC Financing Statements (with
respect to the Property being acquired) in the filing offices
designated by the Construction Agent or the Lessee, such UCC Financing
Statements will have been filed with the appropriate Governmental
Authorities in order to perfect a security interest in the Property
described therein (to the extent perfection can be obtained by filing
under the UCC);
(h) Upon filing in the filing offices designated by the
Construction Agent or the Lessee, the Lender Financing Statements,
together with an assignment to the Agent of the filed Lessor Financing
Statements, will perfect a valid first priority security interest in
all Equipment and other collateral described therein in which a
security interest or mortgage can be perfected by filing under the UCC,
subject only to Permitted Exceptions, and upon filing, the Lessor
Financing Statements will protect Lessor's interest under the Lease to
the extent the Lease is a security agreement and mortgage;
(i) No portion of any Property being acquired by the Lessor on
such Property Closing Date is located in an area identified as a
special flood hazard area by the Federal Emergency Management Agency or
other applicable agency, or if any such Property is located in an area
identified as a special flood hazard area by any such agency, then
flood insurance has been obtained for such Property in accordance with
SECTION 14.2(B) of the Lease and in accordance with the National Flood
Insurance Act of 1968, as amended;
(j) The Construction Agent has obtained insurance coverage for
each Property being acquired by the Lessor on such Property Closing
Date which meets the requirements of ARTICLE XIV of the Lease and all
of such coverage is in full force and effect;
(k) Each Property being acquired by the Lessor on such
Property Closing Date complies with all Legal Requirements (including,
without limitation, all zoning and land use laws and Environmental
Laws), except to the extent that failure to comply therewith would not,
individually or in the aggregate, have a Material Adverse Effect; and
(l) All utility services and facilities necessary for the
construction of the Improvements existing on, or to be constructed
after, such Property Closing Date (including, without limitation, gas,
electrical, water and sewage services and facilities) are available at
the boundaries of the real property upon which such Improvements exist
or will be constructed on each such Property prior to the Completion
Date for such Property.
8.2. REPRESENTATIONS AND WARRANTIES UPON INITIAL CONSTRUCTION FUNDINGS.
The Construction Agent and the Lessee hereby represent and warrant as of each
date on which an Initial Construction Funding is made as follows:
28
(a) The representations and warranties of the Construction
Agent and the Lessee set forth in the Operative Agreements (including
without limitation the representations and warranties set forth in
SECTIONS 7 AND 8.1) are true and correct in all material respects on
and as of the date of such Initial Construction Funding as if made on
and as of such date. The Construction Agent and the Lessee are in all
material respects in compliance with their respective obligations under
the Operative Agreements and there does not exist any Default or Event
of Default under any of the Operative Agreements. No Default or Event
of Default will occur under any of the Operative Agreements as a result
of, or after giving effect to, the Funding requested by the Requisition
on such date;
(b) The Lessor has marketable title to each Property, subject
only to Permitted Exceptions;
(c) Upon filing in the filing offices designated by the
Construction Agent or the Lessee, the Lender Financing Statements,
together with an assignment of the filed Lessor Financing Statements,
will perfect a valid first priority security interest in all the
Properties and other collateral described therein in which a security
interest can be perfected by filing under the UCC, subject only to
Permitted Liens;
(d) All consents, licenses, permits, authorizations,
assignments and building permits required as of the date on which such
Funding is made by all Legal Requirements or pursuant to the terms of
any contract, indenture, instrument or agreement for construction,
completion, occupancy, operation, leasing or subleasing of each
Property with respect to which a Funding is being made have been
obtained and are in full force and effect, except to the extent that
the failure to so obtain would not, individually or in the aggregate,
have a Material Adverse Effect;
(e) The Construction Agent has obtained insurance coverage
covering the Property which is the subject of such Funding which
coverage meets the requirements of SECTION 2.6 of the Agency Agreement
before commencing construction, repairs or modifications, as the case
may be, and such coverage is in full force and effect;
(f) The Improvements which are the subject of the Funding, as
improved in accordance with the Plans and Specifications, will comply
as of the applicable Completion Date with all applicable Legal
Requirements and Insurance Requirements (including, without limitation,
all zoning and land use laws and Environmental Laws), except to the
extent the failure to comply therewith would not, individually or in
the aggregate, have a Material Adverse Effect. The Plans and
Specifications have been or will be prepared in accordance with all
applicable Legal Requirements (including, without limitation, all
applicable Environmental Laws and building, planning, zoning and fire
codes), except to the extent the failure to comply therewith would not,
individually or in the aggregate, have a Material Adverse Effect, and
upon completion of such Improvements in accordance with the Plans and
Specifications, such Improvements will not encroach in any manner onto
any adjoining land (except as permitted by express written easements)
and such Improvements and the use thereof by the Lessee and its agents,
assignees, employees, invitees, lessees,
29
licensees and tenants will comply as of the applicable Completion Date
in all respects with all applicable Legal Requirements (including,
without limitation, all applicable Environmental Laws and building,
planning, zoning and fire codes), except to the extent the failure to
comply therewith would not, individually or in the aggregate, have a
Material Adverse Effect. Upon completion of such Improvements in
accordance with the Plans and Specifications, (i) there will be no
material defects to such Improvements including, without limitation,
the plumbing, heating, air conditioning and electrical systems thereof
and (ii) all water, sewer, electric, gas, telephone and drainage
facilities and all other utilities required to adequately service such
Improvements for their intended use will be available pursuant to
adequate permits (including any that may be required under applicable
Environmental Laws), except to the extent that failure to obtain any
such permit would not, individually or in the aggregate, have a
Material Adverse Effect. There is no action, suit or proceeding
(including any proceeding in condemnation or eminent domain or under
any Environmental Law) pending or, to the best knowledge of the Lessee
or the Construction Agent, threatened which adversely affects the title
to, or the use, operation or value of, such Properties. No fire or
other casualty with respect to such Properties has occurred which (y)
has had a Material Adverse Effect or (2) is not fully covered by
insurance. All utilities serving the related Properties, or proposed to
serve the related Properties in accordance with the Plans and
Specifications, are located in (or will be located in) and vehicular
access to such Improvements is provided by (or will be provided by),
either public rights-of-way abutting the related Property or
Appurtenant Rights. All licenses, approvals, authorizations, consents,
permits (including, without limitation, building, demolition and
environmental permits, licenses, approvals, authorizations and
consents), easements and rights-of-way, including proof of dedication,
required for (i) the use, treatment, storage, transport, disposal or
disposition of any Hazardous Substance on, at, under or from the real
property underlying such Improvements during the construction of such
Improvements and the use and operation of such Improvements following
such construction, (ii) the construction of such Improvements in
accordance with the Plans and Specifications and the Agency Agreement
and (iii) the use and operation of such Improvements following such
construction with the applicable Equipment which such Improvements
support for the purposes for which they were intended have either been
obtained from the appropriate Governmental Authorities or from private
parties, as the case may be, or will be obtained from the appropriate
Governmental Authorities or from private parties, as the case may be,
prior to commencing any such construction or use and operation, as
applicable; and
(g) All conditions precedent contained in this Agreement and
in the other Operative Agreements relating to the Initial Construction
Funding have been substantially satisfied.
8.3. REPRESENTATIONS AND WARRANTIES UPON THE DATE OF EACH CONSTRUCTION
FUNDING THAT IS NOT AN INITIAL CONSTRUCTION FUNDING. The Construction Agent and
the Lessee hereby represent and warrant as of each date on which a Construction
Funding is made, when such advance is not an Initial Construction Funding, as
follows:
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(a) The representations and warranties of the Construction
Agent and the Lessee set forth in the Operative Agreements (including
the representations and warranties set forth in SECTIONS 7, 8.1 AND
8.2) are true and correct in all material respects on and as of the
date of such Construction Funding as if made on and as of such date.
The Construction Agent and the Lessee are in all material respects in
compliance with their respective obligations under the Operative
Agreements and there does not exist any Default or Event of Default
under any of the Operative Agreements. No Default or Event of Default
will occur under any of the Operative Agreements as a result of, or
after giving effect to, the Funding requested by the Requisition on
such date;
(b) Construction of the Improvements to date has been
performed in a good and workmanlike manner, substantially in accordance
with the Plans and Specifications and in compliance with all Insurance
Requirements and Legal Requirements, except to the extent noncompliance
with any Legal Requirements would not, individually or in the
aggregate, have a Material Adverse Effect;
(c) All consents, licenses, permits, authorizations,
assignments and building permits required as of the date on which such
Funding is made by all Legal Requirements or pursuant to the terms of
any contract, indenture, instrument or agreement for construction,
completion, occupancy, operation, leasing or subleasing of each
Property have been obtained and are in full force and effect;
(d) When completed, the Improvements shall be wholly within
any building restriction lines (unless consented to by applicable
Government Authorities), however established; and
(e) The Funding is secured by the Lien of the Security
Agreement, and there have been no Liens against the applicable
Improvements other than Permitted Liens.
SECTION 9. PAYMENT OF CERTAIN EXPENSES.
9.1. TRANSACTION EXPENSES.
(a) Lessor agrees on the Initial Closing Date, to pay, or
cause to be paid, all reasonable fees, expenses and disbursements of
the various outside legal counsels for the Lessor and the Agent in
connection with the transactions contemplated by the Operative
Agreements and incurred in connection with the Initial Closing Date,
including all Transaction Expenses (arising in connection with the
Initial Closing Date), and all other reasonable fees, expenses and
disbursements in connection with the Initial Closing Date, and
including, without limitation, all fees, taxes and expenses for the
recording, registration and filing of documents; PROVIDED, HOWEVER,
that the Lessor shall pay such amounts described in this SECTION 9.1(A)
only if (i) such amounts are properly described in a Requisition
delivered on or before such date (or, in the absence of such a
Requisition, if requested by the Agent, subject to SECTION 5.2(C)), and
(ii) funds are made available by the Lenders and the Holders in
connection with such Requisition in an amount sufficient to
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allow such payment. On the Initial Closing Date, after delivery and
receipt of the Requisition referenced in SECTION 4.2(A) hereof and
satisfaction of the other conditions precedent for such date, the
Holders shall make Holder Fundings and the Lenders shall make Loans to
the Lessor to pay for the Transaction Expenses, fees, expenses and
other disbursements referenced in this SECTION 9.1(A).
(b) Lessor agrees on each Property Closing Date, on the date
of any Construction Funding and on the Completion Date to pay, or cause
to be paid, all reasonable fees, expenses and disbursements of the
various legal counsels for the Lessor and the Agent in connection with
the transactions contemplated by the Operative Agreements and billed in
connection with such Property Closing Date, the date of such Funding,
or such Completion Date, including all Transaction Expenses (arising
with respect to the Initial Closing Date, such Property Closing Date,
the date of such Funding or such Completion Date), all fees, expenses
and disbursements incurred with respect to the various items referenced
in SECTIONS 5.3, 5.4, 5.5 OR 5.6 (including without limitation the cost
of any Appraisals or environmental site assessments, any developer's
fees, any premiums for title insurance policies and charges for any
updates to such policies) and all other reasonable fees, expenses and
disbursements in connection with such Property Closing Date, the date
of such Funding or such Completion Date including, without limitation,
all expenses relating to and all fees (including brokers' fees), taxes
(including any and all stamp, transfer or similar taxes) and expenses
for the recording, registration and filing of documents; PROVIDED,
HOWEVER, the Lessor shall pay such amounts described in this SECTION
9.1(B) only if (i) such amounts are properly described in a Requisition
delivered on the applicable date (or, in the absence of such a
Requisition, if requested by the Agent, subject to SECTION 5.2(C)), and
(ii) funds are made available by the Lenders and the Holders in
connection with such Requisition in an amount sufficient to allow such
payment. On each Property Closing Date, on the date of any Construction
Funding or any Completion Date, after delivery of the applicable
Requisition and satisfaction of the other conditions precedent for such
date, the Holders shall make a Holder Funding and the Lenders shall
make Loans to the Lessor to pay for the Transaction Expenses, fees,
expenses and other disbursements referenced in this SECTION 9.1(B).
9.2. CERTAIN FEES AND EXPENSES. Lessee agrees to pay or cause to be
paid (i) all reasonable costs and expenses (including reasonable counsel fees
and expenses) incurred by the Construction Agent, the Lessee, the Agent, the
Lenders, the Holders or the Lessor in entering into any future amendments or
supplements requested by the Lessee with respect to any of the Operative
Agreements, whether or not such amendments or supplements are ultimately entered
into, or giving or withholding of waivers of consents hereto or thereto which
have been requested by the Lessee, or any purchase of any Property by the Lessee
pursuant to ARTICLE XX of the Lease, (ii) all reasonable costs and expenses
(including reasonable counsel fees and expenses) incurred by the Lessor, the
Construction Agent, the Lessee, the Holders, the Lenders or the Agent in
connection with the enforcement of any Operative Agreement or any exercise of
remedies under any Operative Agreement, and (iii) (following the Completion Date
for the initial Property), the initial and annual Owner Trustee's fee and all
reasonable expenses of the Owner Trustee and any necessary co-trustees
(including reasonable outside counsel fees and expenses) or any
32
successor owner trustee, for acting as owner trustee under the Trust Agreement.
From the date of this Agreement through the Completion Date for the initial
Property, the Owner Trustee shall cause to be paid the initial and annual Owner
Trustee's fee and all reasonable expenses of the Owner Trustee and any necessary
co-trustees (including reasonable outside counsel fees and expenses) or any
successor owner trustee, (a) to the extent, but only to the extent, amounts are
available therefor under the Available Commitments and Available Holder
Commitments and (b) unless each Lender and each Holder has declined in writing
to fund such amount. Notwithstanding any other provision in any other Operative
Agreement to the contrary, all amounts so advanced shall be deemed added to the
Property Cost of all the Properties (ratably with respect to each Property,
based on the ratio of the Property Cost for such Property individually to the
aggregate Property Cost of all Properties at such time).
9.3. UNUSED FEE AND HOLDER UNUSED FEE. From the date hereof through the
Construction Period Termination Date, the Owner Trustee shall pay (a) to the
Agent, for the pro rata benefit of the Lenders of each Category of Loans based
on the Commitment Percentage of each such Lender during the period for which
payment is made, the Unused Fee; and (b) to the Lessor, for the pro rata benefit
of the Holders based on the Holder Commitment of each such Holder during the
period for which payment is made, the Holder Unused Fee; PROVIDED that such
amounts under clauses (a) and (b) shall be paid by the Owner Trustee (i) to the
extent, but only to the extent, amounts are available therefor under the
Available Commitments and Available Holder Commitments and (ii) unless each
Lender and each Holder has declined in writing to fund such amount.
Notwithstanding any other provision in any other Operative Agreement to the
contrary, all amounts so advanced shall be deemed added to the Property Cost of
all the Properties (ratably with respect to each Property, based on the ratio of
the Property Cost for such Property individually to the aggregate Property Cost
of all Properties at such time). Such payments of fees provided for in this
SECTION 9.3 shall be due in arrears on each Unused Fee Payment Date.
Notwithstanding the foregoing, so long as any Lender or Holder fails (in
violation of the Operative Agreements) to make available any portion of its
Commitment or Holder Commitment when requested, such Person shall not be
entitled to receive payment of its pro rata share of its Unused Fee or Holder
Unused Fee (as the case may be) until such Person shall make available such
portion. Each such fee shall be calculated on the basis of a year of 360 days
for the actual number of days elapsed. If all or a portion of any Unused Fee or
Holder Unused Fee shall not be paid when due, such overdue amount shall bear
interest, payable by the Lessee on demand, at a rate per annum equal to the Base
Rate plus 2%, from the date of such non-payment until such amount is paid in
full (as well after as before judgment).
SECTION 10. OTHER COVENANTS AND AGREEMENTS.
10.1. COOPERATION WITH THE CONSTRUCTION AGENT OR THE LESSEE. The
Holders, the Owner Trustee (at the direction of the Holders) and the Agent
shall, to the extent reasonably requested by the Construction Agent or Lessee
(but without assuming additional liabilities on account thereof), at the
Construction Agent's or the Lessee's expense, cooperate with the Construction
Agent or the Lessee in connection with its covenants contained herein including,
without limitation, at any time and from time to time, upon the request of the
Construction Agent or the Lessee, promptly and duly executing and delivering any
and all such further instruments, documents and financing statements (and
continuation statements related thereto) as the Construction Agent or the Lessee
may reasonably request in order to perform such covenants.
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10.2. COVENANTS OF THE OWNER TRUSTEE AND THE HOLDERS. Each of the Owner
Trustee and the Holders hereby agree that so long as this Agreement is in
effect:
(a) None of the Holders and the Owner Trustee (both in its
trust capacity and in its individual capacity) will create or permit to
exist at any time, and each of the Holders and the Owner Trustee will,
at its own cost and expense, promptly take such action (and notify
Lessee of such action) as may be necessary duly to discharge, or to
cause to be discharged, all Lessor Liens attributable to it on the
Properties; PROVIDED, HOWEVER, that the Holders and the Owner Trustee
shall not be required to discharge any such Lessor Lien while the same
is being contested in good faith by appropriate proceedings diligently
prosecuted so long as (a) such proceedings shall not involve any
material danger of impairment of the Liens of the Security Documents or
of the sale, forfeiture or loss of, any Property or title thereto or
any interest therein or the payment of Rent, and (b) such proceedings
shall not materially interfere with the disposition of any Property or
title thereto or interest therein or the payment of Rent;
(b) Without prejudice to any right of the Owner Trustee under
the Trust Agreement to resign (subject to requirement set forth in the
Trust Agreement that such resignation shall not be effective until a
successor shall have agreed to accept such appointment), or the
Holders' rights under the Trust Agreement to remove the institution
acting as Owner Trustee (after consent to such removal by the Agent as
provided in the Trust Agreement), each of the Holders and the Owner
Trustee hereby agrees with the Lessee and the Agent (i) not to
terminate or revoke the trust created by the Trust Agreement except as
permitted by ARTICLE VIII of the Trust Agreement, (ii) not to amend,
supplement, terminate or revoke or otherwise modify any provision of
the Trust Agreement in such a manner as to adversely affect the rights
of the Lessee or the Agent without the prior written consent of such
party and (iii) to comply with all of the terms of the Trust Agreement,
the nonperformance of which would adversely affect any such party;
(c) The Owner Trustee or any successor may resign or be
removed by the Holders as Owner Trustee, a successor Owner Trustee may
be appointed and a corporation may become the Owner Trustee under the
Trust Agreement, only in accordance with the provisions of ARTICLE IX
of the Trust Agreement and, with respect to such appointment, with the
consent of the Lessee, which consent shall not be unreasonably
withheld, conditioned or delayed;
(d) The Owner Trustee, in its capacity as Owner Trustee under
the Trust Agreement, and not in its individual capacity, shall not
contract for, create, incur or assume any indebtedness, or enter into
any business or other activity, other than pursuant to or under the
Operative Agreements;
(e) The Holders will not instruct the Owner Trustee to take
any action in violation of the terms of any Operative Agreement;
(f) Neither any Holder nor the Owner Trustee shall (i)
commence any case, proceeding or other action with respect to the Owner
Trustee under any existing or future law of any jurisdiction, domestic
or foreign, relating to bankruptcy, insolvency,
34
reorganization, arrangement, winding-up, liquidation, dissolution,
composition or other relief with respect to it or its debts, or (ii)
seek appointment of a receiver, trustee, custodian or other similar
official with respect to the Owner Trustee or for all or any
substantial benefit of the creditors of the Owner Trustee; and neither
any Holder nor the Owner Trustee shall take any action in furtherance
of, or indicating its consent to, approval of, or acquiescence in, any
of the acts set forth in this paragraph;
(g) The Owner Trustee shall give prompt notice to the Lessee
and the Agent if the Owner Trustee's chief place of business or chief
executive office, or the office where the records concerning the
accounts or contract rights relating to a Property are kept, shall
cease to be located at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, or if it shall change its name;
(h) Provided that no Lease Event of Default has occurred and
is continuing, neither the Owner Trustee nor any Holder shall, without
the prior written consent of the Lessee, consent to or permit any
amendment, supplement or other modification of the terms and provisions
of the Credit Agreement or the Notes or (to the extent such amendment,
supplement or modification would have an adverse effect on the rights
or obligations of the Lessee under the Lease) any other Operative
Agreement;
(i) Neither the Owner Trustee nor any Holder shall consent to
or permit any amendment, supplement or other modification of the terms
and provisions of any Operative Agreement, in each case without the
prior written consent of the Agent except as described in SECTION 10.5
of this Agreement;
(j) The Owner Trustee (i) shall take such actions and shall
refrain from taking such actions with respect to the Operative
Agreements or the Properties and shall grant such approvals and
otherwise act or refrain from acting with respect to the Operative
Agreements or the Properties in each case as directed in writing by the
Agent or, to the extent required by SECTION 10.5 hereof, the Lessee,
notwithstanding any contrary instruction or absence of instruction by
any Holder or Holders; and (ii) shall not take any action, grant any
approvals or otherwise act under or with respect to the Operative
Agreements or any matters relating to the Properties without first
obtaining the prior written consent of the Agent (and without regard to
any contrary instruction or absence of instruction by any Holder);
PROVIDED, HOWEVER, that notwithstanding the foregoing provisions of
this subparagraph (j) the Owner Trustee, the Agent and the Holders each
acknowledge, covenant and agree that, with respect to all matters under
the Operative Agreements that require the consent or concurrence of all
of the Lenders pursuant to the terms of SECTION 9.1 of the Credit
Agreement (the "Unanimous Vote Matters"), neither the Owner Trustee nor
the Agent shall act or refrain from acting with respect to any
Unanimous Vote Matter until such party has received the approval of
each Lender and each Holder with respect thereto;
(k) Except as otherwise contemplated by the Operative
Agreements, neither the Owner Trustee nor any Holder shall use the
proceeds of any Loan or Holder Funding for any purpose other than the
payment of Transaction Expenses and the fees, expenses and other
disbursements referenced in SECTIONS 9.1(A) and (B) of this Agreement,
the
35
purchase or lease of Properties, the acquisition of Equipment, the
construction of Improvements and the payment of interest regarding the
Loans and the payment of the Holder Yield regarding the Holder
Fundings, in each case accrued under the Credit Agreement or Trust
Agreement, as the case may be, during the period prior to the
Completion Date with respect to a particular Property; and
(l) during the period prior to the Completion Date for the
initial Property, the Lessee shall cause the Lessor to pay (when and as
due) any fees pursuant to the Fee Letter (a) to the extent, but only to
the extent, amounts are available therefor under the Available
Commitments and Available Holder Commitments and (b) unless each Lender
and each Holder has declined in writing to fund such amount; and
(m) following the Completion Date for the initial Property,
the Lessee shall pay (when and as due) any fees pursuant to the Fee
Letter.
10.3. LESSEE COVENANTS, CONSENT AND ACKNOWLEDGMENT; CONSTRUCTION AGENT
COVENANTS.
(a) Lessee acknowledges and agrees that the Owner Trustee,
pursuant to the terms and conditions of the Security Agreement and the
Mortgage Instruments, shall create Liens respecting the various
personal property, fixtures and real property described therein in
favor of the Agent. Lessee hereby irrevocably consents to the creation,
perfection and maintenance of such Liens.
(b) Lessor hereby instructs Lessee, and Lessee hereby
acknowledges and agrees, that until such time as the Loans are paid in
full and the Liens evidenced by the Security Agreement and the Mortgage
Instruments have been released, (i) any and all Rent and any and all
other amounts of any kind or type under any of the Operative Agreements
due and owing or payable to the Lessor or the Owner Trustee shall
instead be paid directly to the Agent or as the Agent may direct from
time to time and (ii) Lessee shall cause all notices, certificates,
financial statements, communications and other information which is
delivered, or is required to be delivered, to the Lessor, the Owner
Trustee or any Holder also to be delivered at the same time to the
Agent.
(c) Lessee shall not consent to or permit any amendment,
supplement or other modification of the terms or provisions of any
Operative Agreement without, in each case, obtaining the prior written
consent of the Agent and, to the extent required by the proviso at the
end of SECTION 10.2(J) hereof, each of the Holders.
(d) Except as otherwise contemplated by the Operative
Agreements, the Construction Agent shall not use the proceeds of any
Holder Funding or Loan for any purpose other than the payment of
Transaction Expenses and the fees, expenses and other disbursements
referenced in Section 9.1(A) and (B) of this Agreement, the purchase or
lease of Properties, the acquisition of Equipment, the construction of
Improvements, the payment of interest regarding the Loans and the
payment of the Holder Yield regarding the Holder Fundings, in each case
accrued under the Credit Agreement or Trust Agreement, as the case may
be, during the period prior to the Basic Rent Commencement Date with
respect to a particular Property.
36
(e) The Construction Agent and the Lessee shall ensure that,
at all times, all of the Equipment consists of Fixtures or other goods
incorporated into a Property that are customarily considered to be part
of a building or structure erected on real property (such as heating,
ventilating, air-conditioning, electrical and mechanical equipment or
systems, escalators, elevators, wall and floor coverings, plumbing,
pumps, tanks, conduits, wiring, lighting, security systems, sprinklers
and other fire prevention and extinguishing apparatus).
(f) Neither the Lessee nor the Construction Agent shall create
or permit to exist at any time (and each of the Lessee and the
Construction Agent shall, at its own expense, take such action as may
be necessary to duly discharge, or cause to be discharged) any Lien
against any Property other than Permitted Liens.
(g) The Lessee and the Construction Agent agree that the
aggregate Property Cost of each Property shall at all times be less
than or equal to 106% of the appraised value of such Property as shown
in the most recent Appraisal of such Property received by the Agent
pursuant to SECTION 5.3(B) or otherwise.
(h) The Lessee and the Construction Agent agree that they
shall, so long as any commitment or Holder Commitment exists, or any
obligation remains unpaid, maintain the Letter of Credit, in form and
substance satisfactory to the Agent, securing the L/C Obligations
(defined below) of the Lessee and the Construction Agent up to an
amount equal to the greatest of (i) $7,995,200, (ii) 20% of the
aggregate of the Commitments and Holder Commitments (from time to
time), or (iii) 20% of the aggregate Property Cost (from time to time)
of all of the Properties, SUBJECT however to reduction in accordance
with SECTION 5.6. "L/C Obligations" means collectively, (i) any
obligations of the Lessee or the Construction Agent under the Guaranty
Agreement, (ii) any payment identified as a payment pursuant to SECTION
22.1(B) of the Lease (or otherwise) of the Maximum Residual Guaranty
Amount (or any such lesser amount as may be required pursuant to such
Section) in respect of the Properties, and (iii) upon and during the
continuation of an Event of Default, any obligations of the Lessee or
the Construction Agent under any Operative Agreement.
(i) The Lessee agrees to perform each of the Incorporated
Covenants and any other covenants set forth in (or incorporated by
reference into) Article XXVIII of the Lease, in accordance with their
respective terms.
(j) The Lessee and the Construction Agent shall take all
reasonable and necessary steps to identify any wetlands, tidelands or
swamp and overflow lands on any Property prior to development of, or
construction of any Improvements on, such Property, and each Property
will be developed in a manner consistent with all applicable wetlands
regulations.
(k) The Lessee and the Construction Agent give immediate
notice to the Agent and the Owner Trustee in the event that any
condition arising from or affecting any Property or arising from or
affecting any lands nearby or adjacent to any Property has or
37
threatens to have a significant adverse effect upon human health or the
environment at such Property or upon the use or value of such Property.
10.4. SHARING OF CERTAIN PAYMENTS. The parties hereto acknowledge and
agree that all payments due and owing by the Lessee to the Lessor under the
Lease or any of the other Operative Agreements shall be made by the Lessee
directly to the Agent as more particularly provided in SECTION 10.3 hereof. The
Holders and the Agent, on behalf of the Lenders, acknowledge the terms of
SECTION 8 of the Credit Agreement regarding the allocation of payments and other
amounts made or received from time to time under the Operative Agreements and
agree all such payments and amounts are to be allocated as provided in SECTION 8
of the Credit Agreement. In connection therewith the Holders hereby (a) appoint
the Agent to act as collateral agent for the Holders in connection with the Lien
granted by the Mortgage Instruments to secure the Holder Amount and (b)
acknowledge and agree and direct that the rights and remedies of the
beneficiaries of the Lien of the Mortgage Instruments shall be exercised by the
Agent on behalf of the Lenders and the Holders as directed from time to time by
the Lenders without notice to or consent from the Holders.
10.5. GRANT OF EASEMENTS, VOTING AT MEETINGS, ETC. The Agent and the
Holders hereby agree that, so long as no Event of Default shall have occurred
and be continuing, and until such time as the Agent gives instructions to the
contrary to the Owner Trustee, the Owner Trustee shall, from time to time at the
request of the Lessee, in connection with the transactions contemplated by the
Agency Agreement, the Lease or the other Operative Agreements, (i) grant
easements and other rights in the nature of easements with respect to any
Property, (ii) release existing easements or other rights in the nature of
easements which are for the benefit of any Property, (iii) execute and deliver
to any Person any instrument appropriate to confirm or effect such grants or
releases, and (iv) execute and deliver to any Person such other documents or
materials in connection with the acquisition, development or operation of any
Property, including, without limitation, reciprocal easement agreements,
operating agreements, development agreements, plats, replats or subdivision
documents; provided, that each of the agreements and documents referred to in
this SECTION 10.5 shall be of the type normally executed by the Lessee in the
ordinary course of the Lessee's business and shall be on commercially reasonable
terms so as not to diminish the value of any Property in any material respect.
SECTION 11. CREDIT AGREEMENT AND TRUST AGREEMENT.
11.1. CONSTRUCTION AGENT'S AND LESSEE'S CREDIT AGREEMENT RIGHTS.
Notwithstanding anything to the contrary contained in the Credit Agreement, the
Agent, the Construction Agent, the Lessee and the Owner Trustee hereby agree
that, prior to the occurrence and continuation of any Lease Default or Lease
Event of Default, the Construction Agent and the Lessee (as designated below)
shall have the following rights:
(a) the Construction Agent shall have the right and obligation
(as more specifically provided in SECTION 5.7 hereof) to designate the
portion of the Loans on which interest is due and payable for purposes
of the definition of "Allocated Interest";
(b) the Construction Agent shall have the right to give the
notice referred to in SECTION 2.3 of the Credit Agreement, to designate
the account to which a borrowing under
38
the Credit Agreement is to be credited pursuant to SECTION 2.3 of the
Credit Agreement and to provide the Allocation Notice;
(c) the Lessee shall have the right to terminate or reduce the
Commitments pursuant to SECTION 2.5(A) of the Credit Agreement;
(d) the Lessee shall have the right to exercise the conversion
and continuation options pursuant to SECTION 2.7 of the Credit
Agreement;
(e) the Lessee shall have the right to approve any successor
agent pursuant to SECTION 7.9 of the Credit Agreement;
(f) the Lessee shall have the right to consent to any
assignment by a Lender to which the Lessor has the right to consent
pursuant to SECTION 9.8 of the Credit Agreement; and
(g) without limiting the foregoing clauses (a) through (f),
and in addition thereto, the Lessee shall have the right to exercise
any other right of the Owner Trustee under the Credit Agreement upon
not less than five (5) Business Days' prior written notice from the
Lessee to the Owner Trustee and the Agent.
11.2. CONSTRUCTION AGENT'S AND LESSEE'S TRUST AGREEMENT RIGHTS.
Notwithstanding anything to the contrary contained in the Trust Agreement, the
Construction Agent, the Lessee, the Owner Trustee and the Holders hereby agree
that, prior to the occurrence and continuation of any Lease Default or Lease
Event of Default, the Construction Agent and the Lessee (as designated below)
shall have the following rights:
(a) the Construction Agent shall have the right and the
obligation (as more specifically provided in SECTION 5.7 hereof) to
designate the portion of the Holder Fundings on which Holder Yield is
due and payable for purposes of the definition of Allocated Return in
this Agreement;
(b) the Lessee shall have the right to exercise the conversion
and continuation options pursuant to SECTION 3.8 of the Trust
Agreement;
(c) no removal of the Owner Trustee or appointment of a
successor Owner Trustee pursuant to SECTION 9.1 of the Trust Agreement
shall be made without the prior written consent (not to be unreasonably
withheld or delayed) of the Lessee; and
(d) the Holders and the Owner Trustee shall not amend,
supplement or otherwise modify any provision of the Trust Agreement in
such a manner as to adversely affect the rights of the Lessee without
the prior written consent (not to be unreasonably withheld or delayed)
of the Lessee.
SECTION 12. TRANSFER OF INTEREST.
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12.1. RESTRICTIONS ON TRANSFER. The Holders may, directly or
indirectly, assign, convey or otherwise transfer any of their right, title or
interest in or to the Trust Estate or the Trust Agreement with the prior written
consent of the Agent, and (provided no Default or Event of Default has occurred
and is continuing) the Lessee, and (only if such proposed assignee is not a
Lender) the Majority Lenders (which consent in each case shall not be
unreasonably withheld or delayed), PROVIDED that such consents shall not be
required for an assignment to a Lender or an Affiliate of a Lender. The Owner
Trustee may, subject to the Lien of the applicable Security Documents, but only
with the prior written consent of the Agent, the Holders (which consent may be
withheld by the Agent or the Holders in their sole discretion) and (provided no
Default or Event of Default has occurred and is continuing) the Lessee, directly
or indirectly, assign, convey, appoint an agent with respect to enforcement of,
or otherwise transfer any of the Owner Trustee's right, title or interest in or
to any Property, the Lease, the Trust Agreement, this Agreement (including,
without limitation, any right to indemnification thereunder), or any other
document relating to a Property or any interest in a Property as provided in the
Trust Agreement and the Lease. The provisions of the immediately preceding
sentence shall not apply to the obligations of the Owner Trustee to transfer
Property to the Lessee or a third party purchaser pursuant to ARTICLE XXII of
the Lease upon payment for such Property in accordance with each of the terms
and conditions of the Lease.
12.2. EFFECT OF TRANSFER. From and after any transfer effected in
accordance with this SECTION 12, the transferor shall be released, to the extent
of such transfer, from its liability hereunder and under the other documents to
which it is a party in respect of obligations to be performed on or after the
date of such transfer; provided, however, that any transferor Holder shall
remain liable under ARTICLE XI of the Trust Agreement to the extent that the
transferee Holder shall not have assumed the obligations of the transferor
Holder thereunder. Upon any transfer by the Owner Trustee or a Holder as above
provided, any such transferee shall assume the obligations of the Owner Trustee
and Lessor or the obligations of a Holder, as the case may be, and shall be
deemed an "Owner Trustee", "Lessor" or "Holder", as the case may be, for all
purposes of such documents and each reference herein to the transferor shall
thereafter be deemed a reference to such transferee for all purposes, except as
provided in the preceding sentence. Notwithstanding any transfer of all or a
portion of the transferor's interest as provided in this SECTION 12, the
transferor shall be entitled to all benefits accrued and all rights vested prior
to such transfer including, without limitation, rights to indemnification under
any such document.
SECTION 13. INDEMNIFICATION.
13.1. GENERAL INDEMNITY. Subject to the provisions of SECTIONS 13.4 AND
13.5, and whether or not any of the transactions contemplated hereby shall be
consummated, the Indemnity Provider hereby assumes liability for and agrees to
defend, indemnify and hold harmless each Indemnified Person on an After Tax
Basis from and against any Claims which may be imposed on, incurred by or
asserted against an Indemnified Person by any other Person (but not to the
extent such Claims arise from the gross negligence or willful misconduct of such
Indemnified Person) in any way relating to or arising, or alleged (by any Person
asserting such a Claim against an Indemnified Person) to arise, out of the
execution, delivery, performance or enforcement of this Agreement, the Lease,
any other Operative Agreement or on or with respect to any Property or any part
thereof, including, without limitation, Claims in any way relating to or arising
or alleged to arise out of (a) the financing, refinancing, purchase, acceptance,
rejection, ownership, design,
40
construction, refurbishment, development, delivery, acceptance, nondelivery,
leasing, subleasing, possession, use, operation, maintenance, repair,
modification, transportation, condition, sale, return, repossession (whether by
summary proceedings or otherwise), or any other disposition of a Property, or
any part thereof, including the acquisition, holding or disposition of any
interest in any Property, lease or agreement comprising a portion of any
thereof; (b) any latent or other defect in any property whether or not
discoverable by an Indemnified Person or the Indemnity Provider; (c) any
Environmental Claim, any violation of Environmental Laws, or any other loss of
or damage to any property or the environment relating to any Property, the
Lease, the Agency Agreement or the Indemnity Provider; (d) the Operative
Agreements, or any transaction contemplated thereby; (e) any breach by the
Construction Agent or the Lessee of any of its representations or warranties
under the Operative Agreements to which it is a party or failure by the
Construction Agent or the Lessee to perform or observe any covenant or agreement
to be performed by it under any of the Operative Agreements; (f) the
transactions contemplated hereby or by any other Operative Agreement, in respect
of the application of Parts 4 and 5 of Subtitle B of Title I of ERISA; (g) any
personal injury, death or property damage, including without limitation Claims
based on strict or absolute liability in tort; (h) any easement, right,
agreement or document referred to in SECTION 10.5 of this Agreement; or (i) any
Lien on any Property (other than Liens created by the Operative Agreements).
If a written Claim is made against any Indemnified Person or if any
proceeding shall be commenced against such Indemnified Person (including a
written notice of such proceeding) for any Claim, such Indemnified Person shall
promptly notify the Indemnity Provider in writing and shall not take action with
respect to such Claim without the consent of the Indemnity Provider for thirty
(30) days after the receipt of such notice by the Indemnity Provider; PROVIDED,
HOWEVER, that, in the case of any such Claim, if action shall be required by law
or regulation to be taken prior to the end of such 30-day period, such
Indemnified Person shall endeavor, in such notice to the Indemnity Provider, to
inform the Indemnity Provider of such shorter period, and no action shall be
taken with respect to such Claim without the consent of the Indemnity Provider
before seven (7) days before the end of such shorter period; PROVIDED, FURTHER,
that the failure of such Indemnified Person to give the notices referred to in
this sentence shall not diminish the Indemnity Provider's obligation hereunder
except to the extent such failure materially precludes the Indemnity Provider
from contesting such Claim.
If, within thirty (30) days of receipt of such notice from the
Indemnified Person (or such shorter period as the Indemnified Person has
notified the Indemnity Provider is required by law or regulation for the
Indemnified Person to respond to such Claim), the Indemnity Provider shall
request in writing that such Indemnified Person respond to such Claim, the
Indemnified Person shall, at the expense of the Indemnity Provider, in good
faith conduct and control such action (including, without limitation by pursuit
of appeals) (provided, however, that (A) if such Claim can be pursued by the
Indemnity Provider on behalf of or in the name of such Indemnified Person, the
Indemnified Person, at the Indemnity Provider's request, shall allow the
Indemnity Provider to conduct and control the response to such Claim and (B) in
the case of any Claim, the Indemnified Person may request the Indemnity Provider
to conduct and control the response to such Claim (with counsel to be selected
by the Indemnity Provider and consented to by such Indemnified Person, such
consent not to be unreasonably withheld, conditioned or delayed; provided,
however, that any Indemnified Person may retain separate counsel at the expense
of the Indemnity Provider in the event of a conflict)) by, in the sole
discretion of the Person conducting and
41
controlling the response to such Claim, (1) resisting payment thereof, (2) not
paying the same except under protest, if protest is necessary and proper, (3) if
the payment be made, using reasonable efforts to obtain a refund thereof in
appropriate administrative and judicial proceedings, or (4) taking such other
action as is reasonably requested by the Indemnity Provider from time to time.
The party controlling the response to any Claim shall consult in good
faith with the non-controlling party and shall keep the non-controlling party
reasonably informed as to the conduct of the response to such Claim; PROVIDED,
that all decisions ultimately shall be made in the discretion of the controlling
party, except that the Indemnity Provider may not agree to any dismissal or
settlement of, or other agreement in connection with, any claim without the
prior written consent of such Indemnified Person, if such dismissal, settlement
or agreement would require any admission or acknowledgment of any culpability or
wrongdoing by such Indemnified Person or provide for any nonmonetary relief to
be performed by such Indemnified Person. The parties agree that an Indemnified
Person may at any time decline to take further action with respect to the
response to such Claim and may settle such Claim if such Indemnified Person
shall waive its rights to any indemnity from the Indemnity Provider that
otherwise would be payable in respect of such Claim (and any future Claim, the
pursuit of which is precluded by reason of such resolution of such Claim) and
shall pay to the Indemnity Provider any amount previously paid or advanced by
the Indemnity Provider pursuant to this SECTION 13.1 by way of indemnification
or advance for the payment of any amount regarding such Claim other than
expenses of the action relating to such Claim.
Notwithstanding the foregoing provisions of this SECTION 13.1, an
Indemnified Person shall not be required to take any action and no Indemnity
Provider shall be permitted to respond to any Claim in its own name or that of
the Indemnified Person unless (A) the Indemnity Provider shall have agreed to
pay and shall pay to such Indemnified Person on demand and on an After Tax Basis
all reasonable costs, losses and expenses that such Indemnified Person actually
incurs in connection with such Claim, including, without limitation, all
reasonable legal, accounting and investigatory fees and disbursements, (B) the
Indemnified Person shall have reasonably determined that the action to be taken
will not result in any material danger of sale, forfeiture or loss of any
Property, or any part thereof or interest therein, will not interfere with the
payment of Rent, and will not result in risk of criminal liability, (C) if such
Claim shall involve the payment of any amount prior to the resolution of such
Claim, the Indemnity Provider shall provide to the Indemnified Person an
interest-free advance in an amount equal to the amount that the Indemnified
Person is required to pay (with no additional net after-tax cost to such
Indemnified Person), (D) in the case of a Claim that must be pursued in the name
of an Indemnified Person (or an Affiliate thereof), the Indemnity Provider shall
have provided to such Indemnified Person an opinion of independent counsel
selected by the Indemnified Person and reasonably satisfactory to the Indemnity
Provider stating that a reasonable basis exists to contest such Claim, (E) such
claim is covered by insurance and (F) no Event of Default shall have occurred
and be continuing. In addition, an Indemnified Person shall not be required to
contest any Claim in its name (or that of an Affiliate) if the subject matter
thereof shall be of a continuing nature and shall have previously been decided
adversely by a court of competent jurisdiction pursuant to the contest
provisions of this SECTION 13.1, unless there shall have been a change in law
(or interpretation thereof) and the Indemnified Person shall have received, at
the Indemnity Provider's expense, an opinion of independent counsel selected by
the Indemnified Person and reasonably acceptable to the
42
Indemnity Provider stating that as a result of such change in law (or
interpretation thereof), it is more likely than not that the Indemnified Person
will prevail in such contest.
13.2. GENERAL TAX INDEMNITY.
(a) Subject to the provisions of SECTIONS 13.4 AND 13.5, and
the Indemnity Provider shall pay and assume liability for, and does
hereby agree to indemnify, protect and defend each Property and all
Indemnified Persons, and hold them harmless against, all Impositions on
an After Tax Basis.
(b) (i) Subject to the terms of SECTION 13.2(F), the Indemnity
Provider shall pay or cause to be paid all Impositions
directly to the taxing authorities where feasible and
otherwise to the Indemnified Person, as appropriate, and the
Indemnity Provider shall at its own expense, upon such
Indemnified Person's reasonable request, furnish to such
Indemnified Person copies of official receipts or other
satisfactory proof evidencing such payment.
(ii) In the case of Impositions for which no contest
is conducted pursuant to SECTION 13.2(F) and which the
Indemnity Provider pays directly to the taxing authorities,
the Indemnity Provider shall pay such Impositions prior to the
latest time permitted by the relevant taxing authority for
timely payment. In the case of Impositions for which the
Indemnity Provider reimburses an Indemnified Person, the
Indemnity Provider shall do so within thirty (30) days after
receipt by the Indemnity Provider of demand by such
Indemnified Person describing in reasonable detail the nature
of the Imposition and the basis for the demand (including the
computation of the amount payable). In the case of Impositions
for which a contest is conducted pursuant to SECTION 13.2(F),
the Indemnity Provider shall pay such Impositions or reimburse
such Indemnified Person for such Impositions, to the extent
not previously paid or reimbursed pursuant to subsection (a),
prior to the latest time permitted by the relevant taxing
authority for timely payment after conclusion of all contests
under SECTION 13.2(F).
(iii) Impositions imposed with respect to a Property
for a billing period during which the Lease expires or
terminates with respect to such Property (unless the Lessee
has exercised the Purchase Option with respect to such
Property or the Lessee has otherwise purchased such Property)
shall be adjusted and prorated on a daily basis between the
Indemnity Provider and the Lessor, whether or not such
Imposition is imposed before or after such expiration or
termination and each party shall pay its pro rata share
thereof.
(iv) At the Indemnity Provider's request, the amount
of any indemnification payment by the Indemnity Provider
pursuant to subsection (a) shall be verified and certified by
an independent public accounting firm mutually acceptable to
the Indemnity Provider and the Indemnified Person. The fees
and expenses of such independent public accounting firm shall
be paid by the Indemnity Provider unless such verification
shall result in an adjustment in the Indemnity
43
Provider's favor of 15% or more of the payment as computed by
the Indemnified Person, in which case such fee shall be paid
by the Indemnified Person.
(v) The Indemnified Persons shall use good faith
efforts to take lawful deductions in their respective tax
returns so as to reduce the Impositions required to be
reimbursed by the Indemnity Provider hereunder; PROVIDED,
HOWEVER, that the failure of any Indemnified Person to take
any deduction shall not impair in any way such Person's right
to indemnification from the Indemnity Provider for any
Impositions.
(c) (i) The Indemnity Provider shall be responsible for
preparing and filing any real and personal property or ad valorem tax
returns with respect to each Property. In case any other report or tax
return shall be required to be made with respect to any obligations of
the Indemnity Provider under or arising out of subsection (a) and of
which the Indemnity Provider has knowledge or should have knowledge,
the Indemnity Provider, at its sole cost and expense, shall notify the
relevant Indemnified Person of such requirement and (except if such
Indemnified Person notifies the Indemnity Provider that such
Indemnified Person intends to file such report or return) (A) to the
extent required or permitted by and consistent with Legal Requirements,
make and file in Indemnity Provider's name such return, statement or
report; and (B) in the case of any other such return, statement or
report required to be made in the name of such Indemnified Person,
advise such Indemnified Person of such fact and prepare such return,
statement or report for filing by such Indemnified Person or, where
such return, statement or report shall be required to reflect items in
addition to any obligations of the Indemnity Provider under or arising
out of subsection (a), provide such Indemnified Person at the Indemnity
Provider's expense with information sufficient to permit such return,
statement or report to be properly made with respect to any obligations
of the Indemnity Provider under or arising out of subsection (a). Such
Indemnified Person shall, upon the Indemnity Provider's request and at
the Indemnity Provider's expense, provide any data maintained by such
Indemnified Person (and not otherwise available to or within the
control of the Indemnity Provider) with respect to any Property which
the Indemnity Provider may reasonably require to prepare any required
tax returns or reports.
(d) If as a result of the payment or reimbursement by the
Indemnity Provider of any Imposition or other reasonable expenses of
the Lessor or the payment of any Transaction Expenses incurred in
connection with the transactions contemplated by the Operative
Agreements, the Lessor, the Holders or partners of any Holder shall
suffer a net increase in any federal, state or local income tax
liability, the Indemnity Provider shall indemnify such Persons (without
duplication of any indemnification required by subsection (a)) on an
After Tax Basis for the amount of such increase. The calculation of any
such net increase shall take into account any current or future tax
savings (including tax deductions, net operating loss carry-forward or
tax credits) realized or reasonably expected to be realized by such
Person in respect thereof, as well as any interest, penalties and
additions to tax payable by such Lessor, or such Holder, or such
Affiliate, in respect thereof.
44
(e) As between the Indemnity Provider on one hand, and the
Lessor or the Agent, any Lender or any Holder on the other hand, the
Indemnity Provider shall be responsible for, and the Indemnity Provider
shall indemnify and hold harmless the Lessor, the Agent, the Lenders
and each Holder (without duplication of any indemnification required by
subsection (a)) on an After Tax Basis against, any obligation for
United States or foreign withholding taxes imposed in respect of
payments on the Notes or Certificates or with respect to Rent payments
under the Lease (and, if the Lessor, the Agent, any Lender or any
Holder receives a demand for such payment from any taxing authority,
the Indemnity Provider shall discharge such demand on behalf of the
Lessor, the Agent, such Lender or such Holder); provided, however, that
the right of any Lender to make a claim for indemnification under this
SECTION 13.2(E) is subject to the compliance by such Lender with the
requirements of SECTION 2.13 of the Credit Agreement.
(f) (i) If a written Claim is made against any Indemnified
Person, or if any proceeding shall be commenced
against such Indemnified Person (including a written
notice of such proceeding), for any Impositions, such
Indemnified Person shall promptly notify the
Indemnity Provider in writing and shall not take
action with respect to such Claim or proceeding
without the consent of the Indemnity Provider for
thirty (30) days after the receipt of such notice by
the Indemnity Provider; PROVIDED, HOWEVER, that, in
the case of any such Claim or proceeding, if action
shall be required by law or regulation to be taken
prior to the end of such 30-day period, such
Indemnified Person shall, in such notice to the
Indemnity Provider, inform the Indemnity Provider of
such shorter period, and no action shall be taken
with respect to such Claim or proceeding without the
consent of the Indemnity Provider before seven (7)
days before the end of such shorter period; PROVIDED,
FURTHER, that the failure of such Indemnified Person
to give the notices referred to this sentence shall
not diminish the Indemnity Provider's obligation
hereunder except to the extent such failure precludes
the Indemnity Provider from contesting such Claim.
(ii) If, within thirty (30) days of receipt of such notice
from the Indemnified Person (or such shorter period
as the Indemnified Person has notified the Indemnity
Provider is required by law or regulation for the
Indemnified Person to commence such contest), the
Indemnity Provider shall request in writing that such
Indemnified Person contest such Imposition, the
Indemnified Person shall, at the expense of the
Indemnity Provider, in good faith conduct and control
such contest (including, without limitation, by
pursuit of appeals) relating to the validity,
applicability or amount of such Imposition (provided,
however, that (A) if such contest can be pursued
independently from any other proceeding involving a
tax liability of such Indemnified Person, the
Indemnified Person, at the Indemnity Provider's
request, shall allow the Indemnity Provider to
conduct and control such contest and (B) in the case
of any contest, the Indemnified Person may request
the Indemnity Provider to conduct and control such
contest (with counsel to be selected by the Indemnity
Provider and consented to by such Indemnified Person,
such consent not to be unreasonably withheld,
conditioned or delayed; provided, however, that any
Indemnified Person may retain separate counsel at the
expense of the Indemnity Provider in the event of a
conflict)) by, in the sole discretion of
45
the Person conducting and controlling such contest, (1)
resisting payment thereof, (2) not paying the same except
under protest, if protest is necessary and proper, (3) if the
payment be made, using reasonable efforts to obtain a refund
thereof in appropriate administrative and judicial
proceedings, or (4) taking such other action as is reasonably
requested by the Indemnity Provider from time to time.
(iii) The party controlling any contest shall consult
in good faith with the non-controlling party and shall keep
the non-controlling party reasonably informed as to the
conduct of such contest; PROVIDED, that all decisions
ultimately shall be made in the sole discretion of the
controlling party, except that the Indemnity Provider may not
agree to any dismissal or settlement of, or other agreement in
connection with, any claim without the prior written consent
of such Indemnified Person, if such dismissal, settlement or
agreement would require any admission or acknowledgment of any
culpability or wrongdoing by such Indemnified Person or
provide for any nonmonetary relief to be performed by such
Indemnified Person. The parties agree that an Indemnified
Person may at any time decline to take further action with
respect to the contest of any Imposition and may settle such
contest if such Indemnified Person shall waive its rights to
any indemnity from the Indemnity Provider that otherwise would
be payable in respect of such Imposition (and any future Claim
by any taxing authority, the contest of which is precluded by
reason of such resolution of such contest) and shall pay to
the Indemnity Provider any amount previously paid or advanced
by the Indemnity Provider pursuant to this SECTION 13.2 by way
of indemnification or advance for the payment of any amount
regarding such Imposition other than expenses of such contest.
(iv) Notwithstanding the foregoing provisions of this
SECTION 13.2, an Indemnified Person shall not be required to
take any action and no Indemnity Provider shall be permitted
to contest any Imposition in its own name or that of the
Indemnified Person unless (A) the Indemnity Provider shall
have agreed to pay and shall pay to such Indemnified Person on
demand and on an After Tax Basis all reasonable costs, losses
and expenses that such Indemnified Person actually incurs in
connection with contesting such Imposition, including, without
limitation, all reasonable legal, accounting and investigatory
fees and disbursements, (B) the Indemnified Person shall have
reasonably determined that the action to be taken will not
result in any material danger of sale, forfeiture or loss of
any Property, or any part thereof or interest therein, will
not interfere with the payment of Rent, and will not result in
risk of criminal liability, (C) if such contest shall involve
the payment of the Imposition prior to or during the contest,
the Indemnity Provider shall provide to the Indemnified Person
an interest-free advance in an amount equal to the Imposition
that the Indemnified Person is required to pay (with no
additional net after-tax cost to such Indemnified Person), (D)
in the case of a Claim that must be pursued in the name of an
Indemnified Person (or an Affiliate thereof), the Indemnity
Provider shall have provided to such Indemnified Person an
opinion of independent tax counsel selected by the Indemnified
Person and reasonably satisfactory to the Indemnity Provider
stating that a reasonable basis exists to contest such Claim,
and (E) no Event of Default shall have occurred and
46
be continuing. In addition, an Indemnified Person shall not be
required to contest any claim in its name (or that of an
Affiliate) if the subject matter thereof shall be of a
continuing nature and shall have previously been decided
adversely by a court of competent jurisdiction pursuant to the
contest provisions of this SECTION 13.2, unless there shall
have been a change in law (or interpretation thereof) and the
Indemnified Person shall have received, at the Indemnity
Provider's expense, an opinion of independent tax counsel
selected by the Indemnified Person and reasonably acceptable
to the Indemnity Provider stating that as a result of such
change in law (or interpretation thereof), it is more likely
than not that the Indemnified Person will prevail in such
contest.
13.3. ENVIRONMENTAL INDEMNITY. Without limiting the generality of the
foregoing, whether or not the transactions contemplated hereby shall be
consummated, the Indemnity Provider hereby assumes liability for and agrees to
defend, indemnify and hold harmless each Indemnified Person on an After Tax
Basis from and against any Claims which may be imposed on, incurred by or
asserted against an Indemnified Person by any other Person (but not to the
extent such Claims arise from the gross negligence or willful misconduct of such
Indemnified Person) in any way relating to or arising, or alleged (by any Person
asserting such a Claim against an Indemnified Person) to arise, out of any
Environmental Claim, any violation of Environmental Laws, or any other loss of
or damage to any Property or the environment (including without limitation the
presence on any Property of wetlands, tidelands or swamp or overflow lands, or
any condition arising from or affecting any Property or arising from or
affecting any lands nearby or adjacent to any Property that has or threatens to
have any adverse effect upon human health or the environment at such Property or
upon the use or value of such Property), in each case relating to any Property,
the Lease, the Agency Agreement or the Indemnity Provider.
13.4. ADDITIONAL PROVISIONS REGARDING INDEMNIFICATION DURING
CONSTRUCTION PERIOD OF A PROPERTY. Notwithstanding the provisions of SECTIONS
13.1, 13.2 AND 13.3, (a) the Owner Trustee shall be the only beneficiary of the
provisions set forth in SECTIONS 13.1, 13.2 AND 13.3, with respect to any
Property during the Construction Period for such Property (except that other
Indemnified Persons may benefit from the Environmental Indemnities to the extent
set forth in clause (c) below); (b) in the case of third-party Claims, the
indemnity benefitting the Owner Trustee referred to in clause (a) above shall be
limited to (i) Claims caused by or resulting from the acts or omissions of the
Indemnity Provider, any contractor or subcontractor of the Indemnity Provider,
or any other Person acting by, through or under the Indemnity Provider or any
such contractor or subcontractor, (ii) Environmental Indemnities, or (iii)
Claims for personal injury or death, property damage, loss or theft, strict
liability, workmen's compensation, and other similar insurable liabilities; and
(c) during the Construction Period of a Property, the indemnity provided with
respect to such Property to Indemnified Persons other than the Owner Trustee
shall be limited to Environmental Indemnities for environmental risks or
conditions that exist on the Property Closing Date for such Property. After the
Construction Period for a Property, each Indemnified Person shall be a
beneficiary of the provisions of SECTIONS 13.1, 13.2 AND 13.3 to the fullest
extent of such provisions.
13.5. INDEMNIFICATION PROVIDED BY THE OWNER TRUSTEE IN FAVOR OF THE
OTHER INDEMNIFIED PERSONS. To the extent the Indemnity Provider is not obligated
to indemnify any Indemnified Person with respect to the various matters
described in this SECTION 13.5, the Owner Trustee shall,
47
and does hereby, provide such indemnities in favor of each Indemnified Person
(subject to clauses (a) and (b) below) and shall pay all such amounts owed
pursuant to this SECTION 13.5 with amounts advanced by the Lenders and the
Holders (a) to the extent, but only to the extent, amounts are available
therefor under the Available Commitments and Available Holder Commitments and
(b) unless each Lender and each Holder has declined in writing to fund such
amount. Notwithstanding any other provision in any other Operative Agreement to
the contrary, all amounts so advanced shall be deemed added to the Property Cost
of all the Properties (ratably with respect to each Property, based on the ratio
of the Property Cost for such Property individually to the aggregate Property
Cost of all Properties at such time).
Whether or not any of the transactions contemplated hereby shall be
consummated, the Owner Trustee hereby assumes liability for and agrees to
defend, indemnify and hold harmless each Indemnified Person on an After Tax
Basis from and against any Claims which may be imposed on, incurred by or
asserted against an Indemnified Person by any other Person (but not to the
extent such Claims arise from the gross negligence or willful misconduct of such
Indemnified Person) in any way relating to or arising, or alleged (by any Person
asserting such a Claim against an Indemnified Person) to arise, out of the
execution, delivery, performance or enforcement of this Agreement, the Lease,
any other Operative Agreement or on or with respect to any Property or any part
thereof, including, without limitation, Claims in any way relating to or arising
or alleged to arise out of any of the matters set forth in SECTION 13.1
(including any Claims that would be indemnified by the Indemnity Provider
pursuant to SECTION 13.1 but for the effect of SECTION 13.4).
The Owner Trustee shall pay and assume liability for, and does hereby
agree to indemnify, protect and defend each Property and all Indemnified
Persons, and hold them harmless against, all Impositions on an After Tax Basis
(including any Impositions that would be paid, assumed or indemnified by the
Indemnity Provider pursuant to SECTION 13.2 but for the effect of SECTION 13.4).
THE INDEMNITY OBLIGATIONS UNDERTAKEN BY THE OWNER TRUSTEE PURSUANT TO
THIS SECTION 13.5 ARE IN ALL RESPECTS SUBJECT TO THE LIMITATIONS ON LIABILITY
DESCRIBED IN SECTION 14.11.
SECTION 14. MISCELLANEOUS.
14.1. SURVIVAL OF AGREEMENTS. The representations, warranties,
covenants, indemnities and agreements of the parties provided for in the
Operative Agreements, and the parties' obligations under any and all thereof,
shall survive the execution and delivery of this Agreement, the transfer of any
Property to the Owner Trustee, the acquisition of any Equipment, the
construction of any Improvements, any disposition of any interest of the Owner
Trustee in any Property or any interest of the Holders in the Owner Trust, the
payment of the Notes and any disposition thereof, and shall be and continue in
effect notwithstanding any investigation made by any party and the fact that any
party may waive compliance with any of the other terms, provisions or conditions
of any of the Operative Agreements. Except as otherwise expressly set forth
herein or in other Operative Agreements, the indemnities of the parties provided
for in the Operative Agreements shall survive the expiration or termination of
any thereof. In furtherance and not in limitation of the foregoing and
notwithstanding the occurrence of any Closing Date or
48
the completion of any Funding under this Agreement pursuant to SECTION 5.3 OR
5.5, each condition precedent in connection with any such Closing Date or
Funding which is not fully satisfied may be subsequently required by the Agent
to be satisfied (unless such has been expressly waived in writing by the Agent).
14.2. NO BROKER, ETC. Each of the parties hereto represents to the
others that it has not retained or employed any broker, finder or financial
adviser to act on its behalf in connection with this Agreement, nor has it
authorized any broker, finder or financial adviser retained or employed by any
other Person so to act. Any party who is in breach of this representation shall
indemnify and hold the other parties harmless from and against any liability
arising out of such breach of this representation.
14.3. NOTICES. Unless otherwise specifically provided herein, all
notices, consents, directions, approvals, instructions, requests and other
communications required or permitted by the terms hereof to be given to any
Person shall be given in writing by United States certified or registered mail
(postage prepaid), by nationally recognized courier service, by hand or by
telecopy with confirming notice and any such notice shall become effective upon
receipt and shall be directed to the address of such Person as indicated:
If to the Construction Agent, to it at the following address:
Aviation Sales Company
▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Chief Financial Officer
Telephone No.: (▇▇▇)▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇)▇▇▇-▇▇▇▇
With a copy to:
Akerman, Senterfitt & ▇▇▇▇▇▇, P.A.
SunTrust International Center, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
provided, however, that the failure to deliver such copy shall not
affect the validity of any notice otherwise delivered in accordance
with this section.
If to the Lessee, to it at the following address:
Aviation Sales Company
▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Chief Financial Officer
Telephone No.: (▇▇▇)▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇)▇▇▇-▇▇▇▇
If to the Owner Trustee, to it at the following address:
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to NationsBank, National Association, as a Holder or a Lender, to it at the
following address:
(i) if by certified or registered mail:
NationsBank, National Association
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) if by hand-delivery, courier service or telecopy:
NationsBank, National Association
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
with all notices of requests for Holder Fundings, or conversion, continuation or
prepayment of any Holder Funding, to be sent to:
NationsBank Agency Services
Independence Center, ▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
50
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Agent, to it at the respective following address:
(i) if by certified or registered mail:
NationsBank, National Association
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) if by hand-delivery, courier service or telecopy:
NationsBank, National Association
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
with all notices of borrowing, conversion, continuation or prepayment of any
Loan to be delivered to the address set forth in Section 9.2 of the Credit
Agreement.
And with a copy of all Requisitions, all title insurance endorsements and
down-dates, and all documents identified on, or delivered pursuant to, SECTION
4.2 or Exhibit I or J, to be sent to:
NationsBank, National Association
One Financial Plaza
6-808-09-02
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to any other Lender or Holder, to it at the address specified in the
signature pages to the Credit Agreement or Trust Agreement (as applicable), any
applicable amendment thereto, or any applicable Assignment and Assumption.
From time to time any party may designate a new address for purposes of notice
hereunder by notice to each of the other parties hereto.
51
14.4. COUNTERPARTS. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same instrument.
14.5. AMENDMENTS AND TERMINATION. Neither this Agreement nor any of the
terms hereof may be terminated, amended, supplemented, waived or modified except
by an instrument in writing signed by the Lessor, the Lessee, the Construction
Agent and (subject to Section 9.1 of the Credit Agreement) the Agent. This
Agreement may be terminated by an agreement signed in writing by the Owner
Trustee, the Holders, the Lenders, the Lessee, the Construction Agent and the
Agent.
14.6. HEADINGS, ETC. The Table of Contents and headings of the various
Articles and Sections of this Agreement are for convenience of reference only
and shall not modify, define, expand or limit any of the terms or provisions
hereof.
14.7. PARTIES IN INTEREST. Except as expressly provided herein, none of
the provisions of this Agreement are intended for the benefit of any Person
except the parties hereto; PROVIDED, that the Lenders are intended to be
third-party beneficiaries of this Agreement.
14.8. GOVERNING LAW; WAIVERS OF JURY TRIAL.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF FLORIDA,
WITHOUT REGARD TO ANY OTHERWISE APPLICABLE PRINCIPLES OF CONFLICT OF
LAWS.
(b) TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH OF
THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY
IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY
OTHER OPERATIVE AGREEMENT AND FOR ANY COUNTERCLAIM THEREIN.
14.9. SUBMISSION TO JURISDICTION; WAIVERS. Each of the parties hereto
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Operative
Agreements to which it is a party, or for recognition and enforcement
of any judgment in respect thereof, to the non-exclusive general
jurisdiction of the courts of the State of Florida and the courts of
the United States of America, in each case sitting in Broward County,
Florida, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter
have to the venue of any such
52
action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead
or claim the same,
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail) postage
prepaid, to the respective party at its address set forth in SECTION
14.3 hereof or at such other address of which the Administrative Agent
shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall
limit the right to ▇▇▇ in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding
referred to in this Section 14.9 any special, exemplary, punitive or
consequential damages.
14.10. SEVERABILITY. Any provision of this Agreement that is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render such
provision unenforceable in any other jurisdiction.
14.11. LIABILITY LIMITED.
(a) The Agent, the Lessee and the Holders each acknowledge and
agree that the Owner Trustee is (except as otherwise expressly provided
herein or therein) entering into this Agreement and the other Operative
Agreements to which it is a party (other than the Trust Agreement and
other than as set forth in SECTION 7.2 of this Agreement), solely in
its capacity as trustee under the Trust Agreement and not in its
individual capacity and that Trust Company shall not be liable or
accountable under any circumstances whatsoever in its individual
capacity for or on account of any statements, representations,
warranties, covenants or obligations stated to be those of the Owner
Trustee, except for its own gross negligence or willful misconduct and
except as otherwise expressly provided herein or in the other Operative
Agreements.
(b) Anything to the contrary contained in this Agreement, the
Credit Agreement, the Notes or in any other Operative Agreement
notwithstanding, neither the Lessor nor any Holder (in its capacity as
a Holder) nor any officer, director, shareholder, or partner thereof,
nor any of the successors or assigns of the foregoing (all such Persons
being hereinafter referred to collectively as the "Exculpated
Persons"), shall be personally liable in any respect for any liability
or obligation hereunder or under any other Operative Agreement
including the payment of the principal of, or interest on, the Notes,
or for monetary damages for the breach of performance of any of the
covenants contained in the Credit Agreement, the Notes, this Agreement,
the Security Agreement or any of the other
53
Operative Agreements. The Agent (for itself and on behalf of the
Lenders) agrees that, in the event the Agent or any Lender pursues any
remedies available to them under the Credit Agreement, the Notes, this
Agreement, the Security Agreement, the Mortgage Instruments or under
any other Operative Agreement, neither the Lenders nor the Agent shall
have any recourse against any Exculpated Person, for any deficiency,
loss or Claim for monetary damages or otherwise resulting therefrom,
and recourse shall be had solely and exclusively against the Trust
Estate and the Lessee (with respect to the Lessee's obligations under
the Lease, the Participation Agreement and the Agency Agreement); but
nothing contained herein shall be taken to prevent recourse against or
the enforcement of remedies against the Trust Estate in respect of any
and all liabilities, obligations and undertakings contained herein, in
the Credit Agreement, in the Notes, in the Security Agreement, the
Mortgage Instruments or in any other Operative Agreement.
Notwithstanding the provisions of this Section, nothing in this
Agreement, the Credit Agreement, the Notes, the Security Agreement, the
Mortgage Instruments or any other Operative Agreement shall: (i)
constitute a waiver, release or discharge of any indebtedness or
obligation evidenced by the Notes or arising under this Agreement, the
Security Agreement, the Mortgage Instruments or the Credit Agreement or
secured by the Security Agreement, the Mortgage Instruments or any
other Operative Agreement, but the same shall continue until paid or
discharged; (ii) relieve the Lessor or any Exculpated Person from
liability and responsibility for (but only to the extent of the damages
arising by reason of): (a) active waste knowingly committed by such
Lessor or such Exculpated Person with respect to the Properties or (b)
any fraud, gross negligence, willful misconduct or willful breach on
the part of such Lessor or such Exculpated Person; (iii) relieve such
Lessor or such Exculpated Person from liability and responsibility for
(but only to the extent of the moneys misappropriated, misapplied or
not turned over) (a) misappropriation or misapplication by such Lessor
(I.E., application in a manner contrary to any Operative Agreement) of
any insurance proceeds or condemnation award paid or delivered to such
Lessor by any Person other than the Agent, (b) any deposits or any
escrows or amounts owed by the Lessee under the Agency Agreement held
by such Lessor or (c) any rents or other income received by such Lessor
from the Lessee that are not turned over to the Agent; or (iv) affect
or in any way limit the Agent's rights and remedies under any Operative
Agreement with respect to the Rents and its rights thereunder or its
right to obtain a judgment against the Lessor's interest in the
Properties.
14.12. RIGHTS OF LESSEE. Notwithstanding any provision of the Operative
Agreements, if at any time all obligations (i) of the Owner Trustee under the
Credit Agreement, the Security Documents, the Trust Agreement and the other
Operative Agreements and (ii) of the Lessee under the Operative Agreements have
in each case been satisfied or discharged in full, then the Lessee shall be
entitled to (a) terminate the Lease and (b) receive all amounts then held under
the Operative Agreements and all proceeds with respect to any of the Properties.
Upon the termination of the Lease pursuant to the foregoing clause (a), the
Lessor shall transfer to the Lessee all of its right, title and interest free
and clear of the Lien of the Lease and all Lessor Liens in and to any Properties
then subject to the Lease and any amounts or proceeds referred to in the
foregoing clause (b) shall be paid over to the Lessee.
54
14.13. FURTHER ASSURANCES. The parties hereto shall promptly cause to
be taken, executed, acknowledged or delivered, at the sole expense of the
Lessee, all such further acts, conveyances, documents and assurances as the
other parties may from time to time reasonably request in order to carry out and
effectuate the intent and purposes of this Participation Agreement, the other
Operative Agreements and the transactions contemplated hereby and thereby
(including, without limitation, the preparation, execution and filing of any and
all Uniform Commercial Code financing statements and other filings or
registrations which the parties hereto may from time to time request to be filed
or effected). The Lessee, at its own expense and without need of any prior
request from any other party, shall take such action as may be necessary
(including any action specified in the preceding sentence), or (if Owner Trustee
shall so request) as so requested, in order to maintain and protect all security
interests provided for hereunder or under any other Operative Agreement.
14.14. CALCULATIONS UNDER OPERATIVE AGREEMENTS. The parties hereto
agree that all calculations and numerical determinations to be made under the
Operative Agreements by the Owner Trustee shall be made by the Agent and that
such calculations and determinations shall be conclusive and binding on the
parties hereto in the absence of manifest error.
14.15. CONFIDENTIALITY. Each of the Owner Trustee, the Holders, the
Agent and the Lenders severally agrees to use reasonable efforts to keep
confidential all non-public information pertaining to the Lessee or its
Subsidiaries which is provided to it by the Lessee or its Subsidiaries, and
shall not intentionally disclose such information to any Person except:
(a) to the extent such information is public when received by
such Person or becomes public thereafter due to the act or omission of
any party other than such Person;
(b) to the extent such information is independently obtained
from a source other than the Lessee or any of its Subsidiaries and such
information from such source is not, to such Person's knowledge,
subject to an obligation of confidentiality or, if such information is
subject to an obligation of confidentiality, that disclosure of such
information is permitted;
(c) to any Affiliate of any such Person or to counsel,
auditors or accountants retained by any such Person or any such
Affiliate, provided they agree to keep such information confidential as
if such Person or Affiliate were party to this Agreement and to
financial institution regulators, including examiners of any Lender,
the Agent or the Owner Trustee, any Holder or any Affiliate in the
course of examinations of such Persons;
(d) in connection with any litigation or the enforcement or
preservation of the rights of the Agent, the Owner Trustee, the Lessor,
any Lender or any Holder under the Operative Agreements;
(e) to the extent required by any applicable statute, rule or
regulation or court order (including, without limitation, by way of
subpoena) or pursuant to the request of any regulatory or Governmental
Authority having jurisdiction over any such Person; PROVIDED,
55
HOWEVER, that such Person shall endeavor (if not otherwise prohibited
by Law) to notify the Lessee prior to any disclosure made pursuant to
this clause (e), except that no such Person shall be subject to any
liability whatsoever for any failure to so notify the Lessee;
(f) to the Agent, any Lender or any Holder; or
(g) to the extent disclosure to any other financial
institution or other Person is appropriate in connection with any
proposed or actual (i) assignment or grant of a participation by any of
the Lenders of interests in the Credit Agreement or any Note to such
other financial institution or (ii) assignment by any Holder of
interests in the Trust Agreement to another Person.
14.16. CALCULATION OF RENT, INTEREST, HOLDER YIELD AND FEES. Except as
otherwise expressly set forth in the Operative Agreements, all calculation of
Rent, interest, Holder Yield, Overdue Rate, Holder Overdue Rate, Unused Fees, or
Holder Unused Fees payable hereunder shall be computed based on the actual
number of days elapsed over a year of 360 days.
IN WITNESS WHEREOF, the parties hereto have caused this Participation
Agreement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
AVIATION SALES COMPANY,
as Construction Agent
By:_________________________________
Name:_______________________________
Title:______________________________
AVIATION SALES COMPANY,
as Lessee
By:_________________________________
Name:_______________________________
Title:______________________________
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not individually, except as
SIGNATURE PAGE 1
expressly stated herein, but solely as Owner
Trustee under the Aviation Sales Trust 1998-1
By:_________________________________
Name:_______________________________
Title:______________________________
SIGNATURE PAGE 2
NATIONSBANK, NATIONAL ASSOCIATION,
as Administrative Agent
By:_________________________________
Name:_______________________________
Title:______________________________
NATIONSBANK, NATIONAL ASSOCIATION,
as a Holder
By:_________________________________
Name:_______________________________
Title:______________________________
NATIONSBANK, NATIONAL ASSOCIATION,
as a Lender
By:_________________________________
Name:_______________________________
Title:______________________________
Applicable Funding Office:
____________________________________
____________________________________
____________________________________
SIGNATURE PAGE 3
--------------------------------------------------------------------------------
Appendix A
Rules of Usage and Definitions
--------------------------------------------------------------------------------
I. Rules of Usage
The following rules of usage shall apply to this Participation
Agreement and the Operative Agreements (and each appendix, schedule, exhibit and
annex to the foregoing) unless otherwise required by the context or unless
otherwise defined therein:
(a) Except as otherwise expressly provided, any definitions
set forth herein or in any other document shall be equally applicable
to the singular and plural forms of the terms defined.
(b) Except as otherwise expressly provided, references in any
document to articles, sections, paragraphs, clauses, annexes,
appendices, schedules or exhibits are references to articles, sections,
paragraphs, clauses, annexes, appendices, schedules or exhibits in or
to such document.
(c) The headings, subheadings and table of contents used in
any document are solely for convenience of reference and shall not
constitute a part of any such document nor shall they affect the
meaning, construction or effect of any provision thereof.
(d) References to any Person shall include such Person, its
successors and permitted assigns and transferees.
(e) Except as otherwise expressly provided, reference to any
agreement means such agreement as amended, modified, extended,
supplemented, restated or replaced from time to time in accordance with
the applicable provisions thereof.
(f) Except as otherwise expressly provided, references to any
law includes any amendment or modification to such law and any rules or
regulations issued thereunder or any law enacted in substitution or
replacement therefor.
(g) When used in any document, words such as "hereunder",
"hereto", "hereof" and "herein" and other words of like import shall,
unless the context clearly indicates to the contrary, refer to the
whole of the applicable document and not to any particular article,
section, subsection, paragraph or clause thereof.
(h) References to "including" means including without limiting
the generality of any description preceding such term and for purposes
hereof the rule of ejusdem generis shall not be applicable to limit a
general statement, followed by or referable to an enumeration of
specific matters, to matters similar to those specifically mentioned.
Appendix A-1
(i) Unless the context indicates otherwise, the disjunctive
"or" shall include the conjunctive "and."
(j) Each of the parties to the Operative Agreements and their
counsel have reviewed and revised, or requested revisions to, the
Operative Agreements, and the usual rule of construction that any
ambiguities are to be resolved against the drafting party shall be
inapplicable in the construing and interpretation of the Operative
Agreements and any amendments or exhibits thereto.
II. Definitions
"Acceleration" shall have the meaning given to such term in SECTION 6
of the Credit Agreement.
"Accommodation Obligation" shall have the meaning given to such term in
SECTION 1.01 of the Existing Aviation Sales Credit Agreement.
"acquire" or "purchase" shall mean, with respect to any Property,
unless the context indicates otherwise, the acquisition or purchase of such
Property by the Owner Trustee from any Person.
"Acquisition" means the acquisition of (i) a controlling equity
interest in another Person, whether by purchase of such equity interest or upon
exercise of an option or warrant for, or conversion of securities into, such
equity interest, or (ii) assets of another Person which constitute all or
substantially all of the assets of such Person or of a line or lines of business
conducted by such Person.
"Acquisition Funding" shall mean an advance of funds (consisting of
Loans by the Lenders and Holder Fundings by the Holders) to the Lessor on a
specified date to pay Property Acquisition Costs and other expenses pursuant to
SECTION 5.3(B) of the Participation Agreement.
"Acquisition Loan" shall mean any Loan made in connection with and as
part of an Acquisition Funding.
"Administrative Agent" or "Agent" shall mean, collectively, (a)
NationsBank, together with its Affiliates, as the administrative agent for the
Lenders under this Agreement and the other Operative Agreements and any
successor Administrative Agent who may be appointed pursuant to SECTION 7.9 of
the Credit Agreement, and (b) NationsBank, together with its affiliates, as
agent and collateral agent for itself, the Lenders and the Holders under the
Security Documents.
"Administrator" shall have the meaning given to such term in SECTION
1.01 of the Existing Aviation Sales Credit Agreement.
"Affiliate" shall mean, with respect to any Person, any Person or group
acting in concert in respect of the Person in question that, directly or
indirectly, controls or is controlled by or is under common control with such
Person. For the purposes of this definition, "control (including, with
correlative meanings, the terms "controlled by" and "under common control with")
shall mean the possession, directly or indirectly, of the power to direct or
cause the direction of
Appendix A-2
management and policies of a Person, whether through the ownership of voting
securities or by contract or otherwise.
"After Tax Basis" shall mean, with respect to any payment to be
received, the amount of such payment increased so that, after deduction of the
amount of all taxes required to be paid by the recipient calculated at the rate
believed by such recipient to be the highest marginal rate then applicable to
the recipient (less any tax savings realized as a result of the payment of the
indemnified amount) with respect to the receipt by the recipient of such
amounts, such increased payment (as so reduced) is equal to the payment
otherwise required to be made.
"Agency Agreement" shall mean the Agency Agreement, dated as of the
Initial Closing Date, between the Construction Agent and the Lessor, as such
agreement may be amended, modified, restated or supplemented from time to time
in accordance with the terms thereof.
"Agency Agreement Event of Default" shall mean an "Event of Default" as
defined in SECTION 5.1 of the Agency Agreement.
"Allocated Interest" with respect to any Construction Period Property
shall mean as of any Scheduled Interest Payment Date, the amount of interest due
and payable on such date with respect to a portion of the Loans (which portion
shall be designated by the Borrower by written notice (an "ALLOCATION NOTICE")
to the Administrative Agent) having an aggregate principal amount equal to the
Loan Property Cost of such Property as of such date.
"Allocated Return" with respect to any Construction Period Property
shall mean, as of any Scheduled Interest Payment Date, the amount of Holder
Yield due and payable on such date with respect to a portion of the Holder
Fundings (which portion shall be designated by the Owner Trustee by written
notice to the Holders) having an aggregate stated amount equal to the Holder
Property Cost of such Property as of such date.
"Allocation Notice" shall have the meaning given to such term in the
definition of "Allocated Interest."
"Applicable Base Rate Margin" shall mean that percent per annum set
forth below, which shall be based upon the Consolidated Funded Debt-to-EBITDA
Ratio for the Four-Quarter Period most recently ended as specified below:
--------------------------------------------------------------------------------------------------------------
Consolidated Funded Debt-to-EBITDA
Tier Ratio Applicable Base Rate Margin
--------------------------------------------------------------------------------------------------------------
I Less than or equal to 2.75 to 1.00 0.000%
--------------------------------------------------------------------------------------------------------------
II Greater than 2.75 to 1.00 and less than or
equal to 3.25 to 1.00 0.000%
--------------------------------------------------------------------------------------------------------------
III Greater than 3.25 to 1.00 and less than or
equal to 3.75 to 1.00 0.000%
--------------------------------------------------------------------------------------------------------------
IV Greater than 3.75 to 1.00 and less than or
equal to 4.25 to 1.00 0.250%
--------------------------------------------------------------------------------------------------------------
Appendix A-3
--------------------------------------------------------------------------------------------------------------
Consolidated Funded Debt-to-EBITDA
Tier Ratio Applicable Base Rate Margin
--------------------------------------------------------------------------------------------------------------
V Greater than 4.25 to 1.00 and less than or
equal to 4.75 to 1.00 0.500%
--------------------------------------------------------------------------------------------------------------
VI Greater than 4.75 to 1.00 and less than or
equal to 5.25 to 1.00 0.750%
--------------------------------------------------------------------------------------------------------------
VII Greater than 5.25 to 1.00 0.750%
--------------------------------------------------------------------------------------------------------------
The Applicable Base Rate Margin shall be established at the end of each Fiscal
Quarter of Aviation Sales (the "Determination Date"). Any change in the
Applicable Base Rate Margin following each Determination Date shall be
determined based upon the computations set forth in the certificate furnished to
the Agent pursuant to SECTION 28.1(A)(I) of the Lease, subject to review and
approval of such computations by the Agent, and shall be effective commencing on
the date following the date such certificate is received (or, if earlier, the
date such certificate was required to be delivered) until the date following the
date on which a new certificate is delivered or is required to be delivered,
whichever shall first occur; PROVIDED however, if Aviation Sales shall fail to
deliver any such certificate within five (5) days after the time period required
for delivery of the related financial statements pursuant to SECTION 28.1(A)(I)
of the Lease, then the Applicable Base Rate Margin shall be Tier VI from the
date such certificate was required to be delivered until the appropriate
certificate is so delivered. The foregoing notwithstanding, from the Initial
Closing Date to the date following the date the certificate first delivered
pursuant to SECTION 28.1(A)(II) of the Lease is received (or, if earlier, the
date such certificate was required to be delivered), the Applicable Base Rate
Margin shall be .750%.
"Applicable Funding Office" means for each Lender or Holder and for
each Type of Loan or Holder Funding, the "Funding Office" of such Lender aor
Holder (or of an affiliate of such Lender or Holder) designated for such Type of
Loan or Holder Funding on the signature pages of the Participation Agreement or
the respective Assignment and Acceptance, or such other office of such Lender or
Holder (or an affiliate of such Lender or Holder) as such Lender or Holder may
from time to time specify to the Agent and the Borrower by written notice in
accordance with the terms of the Operative Agreements as the office by which its
Loans or Holder Fundings of such Type are to be made and maintained.
"Applicable Margin" shall mean, for each Eurodollar Loan, that percent
per annum set forth below, which shall be based upon the Consolidated Funded
Debt-to-EBITDA Ratio for the Four-Quarter Period most recently ended as
specified below:
-----------------------------------------------------------------------------------------------------------
Tier Consolidated Funded Debt-to-EBITDA Ratio Applicable Margin
-----------------------------------------------------------------------------------------------------------
I Less than or equal to 2.75 to 1.00 1.375%
-----------------------------------------------------------------------------------------------------------
II Greater than 2.75 to 1.00 and less than or equal
to 3.25 to 1.00 1.500%
-----------------------------------------------------------------------------------------------------------
Appendix A-4
-----------------------------------------------------------------------------------------------------------
Tier Consolidated Funded Debt-to-EBITDA Ratio Applicable Margin
-----------------------------------------------------------------------------------------------------------
III Greater than 3.25 to 1.00 and less than or equal
to 3.75 to 1.00 1.750%
-----------------------------------------------------------------------------------------------------------
IV Greater than 3.75 to 1.00 and less than or equal
to 4.25 to 1.00 2.000%
-----------------------------------------------------------------------------------------------------------
V Greater than 4.25 to 1.00 and less than or equal
to 4.75 to 1.00 2.250%
-----------------------------------------------------------------------------------------------------------
VI Greater than 4.75 to 1.00 and less than or equal
to 5.25 to 1.00 2.500%
-----------------------------------------------------------------------------------------------------------
VII Greater than 5.25 to 1.00 2.750%
-----------------------------------------------------------------------------------------------------------
The Applicable Margin shall be established at the end of each Fiscal Quarter of
Aviation Sales (each, a "Determination Date"). Any change in the Applicable
Margin following each Determination Date shall be determined based upon the
computations set forth in the certificate furnished to the Agent pursuant to
SECTION 28.1(A)(I) of the Lease, subject to review and approval of such
computations by the Agent, and shall be effective commencing on the date
following the date such certificate is received (or, if earlier, the date such
certificate was required to be delivered) until the date following the date on
which a new certificate is delivered or is required to be delivered, whichever
shall first occur; PROVIDED however, if Aviation Sales shall fail to deliver any
such certificate within five (5) days after the time period required for
delivery of the related financial statements pursuant to SECTION 28.1(A)(I) of
the Lease, then the Applicable Margin shall be Tier VI from the date such
certificate was required to be delivered until the appropriate certificate is so
delivered. The foregoing notwithstanding, from the Initial Closing Date to the
date following the date the certificate first delivered pursuant to SECTION
28.1(A)(II) of the Lease is received (or, if earlier, the date such certificate
was required to be delivered), the Applicable Margin shall be 2.50%.
"Applicable Unused Fee Rate" shall mean one-half of one percent (.50%)
per annum.
"Appraisal" shall mean, with respect to any Property an appraisal to be
delivered in connection with SECTION 5.3 of the Participation Agreement, SECTION
3.2 of the Agency Agreement, SECTION 10.1(E) of the Lease, or any other
provision of the Operative Agreements, in each case prepared by a reputable
appraiser reasonably acceptable to the Agent, which in the judgment of counsel
to the Agent, complies with all of the provisions of the Financial Institutions
Reform, Recovery and Enforcement Act of 1989, as amended, the rules and
regulations adopted pursuant thereto, and all other applicable Legal
Requirements.
"Appraisal Procedure" shall have the meaning given such term in SECTION
22.4 of the Lease.
"Approved State" shall mean any state located in the continental United
States.
Appendix A-5
"Appurtenant Rights" shall mean (i) all agreements, easements, rights
of way or use, rights of ingress or egress, privileges, appurtenances,
tenements, hereditaments and other rights and benefits at any time belonging or
pertaining to the Land underlying any Improvements, or the Improvements,
including, without limitation, the use of any streets, ways, alleys, vaults or
strips of land adjoining, abutting, adjacent or contiguous to the Land and (ii)
all permits, licenses and rights, whether or not of record, appurtenant to such
Land.
"Assets" means all "Property", as defined in Section 1.01 of the
Existing Aviation Sales Credit Agreement, to the extent all property or assets
described therein are owned by the Lessee or its Subsidiaries.
"Assignment and Acceptance" shall mean the Assignment and Acceptance in
the form attached as EXHIBIT C to the Credit Agreement.
"Assignment of Project Rights" shall mean the Assignment of Project
Rights and Contract Documents dated as of the Initial Closing Date, between the
Owner Trustee and the Agent, as such agreement may be amended, modified,
restated or supplemented from time to time in accordance with the terms thereof.
"Available Commitment" shall mean, as to any Lender at any time, an
amount equal to the excess, if any, of (a) the amount of such Lender's
Commitment over (b) the aggregate principal amount of all Loans made by such
Lender.
"Available Holder Commitments" shall mean an amount equal to the
excess, if any, of (i) the amount of the Holder Commitments over (ii) the
aggregate amount of the Holder Fundings made since the Initial Closing Date.
"Aviation Sales" shall mean Aviation Sales Company, a Delaware
corporation.
"Aviation Sales Credit Agreement Event of Default" shall mean an "Event
of Default" as defined in the Existing Aviation Sales Credit Agreement (as
amended, modified or restated heretofore or hereafter) or any New Facility,
PROVIDED that an Aviation Sales Credit Agreement Event of Default shall be
deemed to occur on the earlier of (a) the date that the Existing Credit Agent or
other applicable agent or any lender under such credit agreement or New Facility
exercises any remedy thereunder, or (b) twenty (20) days after the occurrence of
such "Event of Default"; and PROVIDED FURTHER that if the applicable agent and
required lenders under such credit agreement or New Facility waive such "Event
of Default" within such 20-day period (without exercising any remedies), then
such "Event of Default" shall not be deemed an "Aviation Sales Credit Agreement
Event of Default".
"Aviation Sales Trust 1998-1" shall mean the grantor trust created
pursuant to the terms and conditions of the Trust Agreement.
"Bankruptcy Code" shall mean Title 11 of the U.S. Code entitled
"Bankruptcy" as now or hereafter in effect, or any successor thereto;
Appendix A-6
"Base Rate" means, for any day, the rate per annum equal to the higher
of (i) the Federal Funds Rate for such day plus one-half of one percent (0.5%)
plus the Applicable Base Rate Margin, or (ii) the Prime Rate for such day plus
the Applicable Base Rate Margin. Any change in the Base Rate due to a change in
the Prime Rate or the Federal Funds Rate shall be effective on the effective
date of such change in the Prime Rate or Federal Funds Rate.
"Base Rate Funding" shall mean a Funding that bears interest (with
respect to the Loans included therein) and Holder Yield (with respect to the
Holder Fundings included therein) based on the Base Rate.
"Base Rate Holder Funding" shall mean a Holder Funding bearing a Holder
Yield based on the Base Rate.
"Base Rate Loans" shall mean Loans the rate of interest applicable to
which is based upon the Base Rate.
"Basic Rent" shall mean, the sum of (i) the Loan Basic Rent and (ii)
the Lessor Basic Rent, calculated as of the applicable date on which Basic Rent
is due.
"Basic Rent Commencement Date" shall have the meaning set forth in
Section 3.1(a)(ii) of the Lease.
"Basic Term" shall have the meaning specified in Section 2.2 of the
Lease.
"Basic Term Commencement Date" or "Term Commencement Date" shall have
the meaning specified in SECTION 2.2 of the Lease.
"Basic Term Expiration Date" shall have the meaning specified in
SECTION 2.2 of the Lease.
"Benefit Plan" shall have the meaning given to such term in SECTION
1.01 of the Existing Aviation Sales Credit Agreement.
"▇▇▇▇ of Sale" shall mean a ▇▇▇▇ of Sale regarding Equipment in form
and substance satisfactory to the Owner Trustee, the Holders and the Agent.
"Board" shall mean the Board of Governors of the Federal Reserve System
of the United States (or any successor).
"Borrowing Date" shall mean any Business Day specified in a notice
delivered pursuant to SECTION 2.3 of the Credit Agreement as a date on which the
Borrower requests the Lenders to make Loans hereunder.
"Bridge Note" shall mean that certain Promissory Note dated October 15,
1998, by the Owner Trustee in favor of NationsBank.
Appendix A-7
"Budgeted Total Loan Property Cost" shall mean, at any date of
determination, with respect to any Construction Period Property, an amount equal
to the aggregate amount which the Construction Agent in good faith expects to be
expended in order to achieve Completion with respect to such Property (including
amounts expected to be expended to pay Allocated Interest and Allocated Return
with respect to such Property).
"Business Day" shall mean a day other than a Saturday, Sunday or other
day on which commercial banks in Fort Lauderdale, Florida or Charlotte, North
Carolina are authorized or required by law to close; PROVIDED, HOWEVER, that
when used in connection with a Eurodollar Loan, the term "Business Day" shall
also exclude any day on which banks are not open for dealings in dollar deposits
in the London interbank market.
"Capital Expenditures" means, with respect to Aviation Sales and its
Subsidiaries, for any period the SUM of (without duplication) (i) all
expenditures (whether paid in cash or accrued as liabilities) by Aviation Sales
or any Subsidiary during such period for items that would be classified as
"property, plant or equipment" or comparable items on the consolidated balance
sheet of Aviation Sales and its Subsidiaries, including without limitation all
transactional costs incurred in connection with such expenditures provided the
same have been capitalized, excluding, however, the amount of any Capital
Expenditures paid for with proceeds of casualty insurance as evidenced in
writing and submitted to the Agent together with any compliance certificate
delivered pursuant to SECTION 28.1(A)(III) of the Lease and (ii) with respect to
any Capital Lease entered into by Aviation Sales or its Subsidiaries during such
period, the present value of the lease payments due under such Capital Lease
over the term of such Capital Lease applying a discount rate equal to the
interest rate provided in such lease (or in the absence of a stated interest
rate, that rate used in the preparation of the financial statements described in
SECTION 7.3(F)(I), and (iii) all Synthetic Lease Indebtedness (other than
Synthetic Lease Indebtedness incurred under the Operative Agreements), all the
foregoing in accordance with GAAP applied on a Consistent Basis.
"Capital Lease" shall have the meaning given to such term in SECTION
1.01 of the Existing Aviation Sales Credit Agreement.
"Capital Stock" shall have the meaning given to such term in SECTION
1.01 of the Existing Aviation Sales Credit Agreement.
"Cash Interest Expense" means, for any Person for any period, total
interest expense, whether paid or accrued, but without duplication, (including
the interest component of Capital Leases and including Synthetic Lease Basic
Rent, but net of the difference between payments received by such Person and its
Subsidiaries on all Hedge Agreements and payments made by such Person and its
Subsidiaries on all Hedge Agreements other than the initial payments made to
enter into such Hedge Agreements) of such Person and its Subsidiaries, which is
payable in cash, all as determined in conformity with GAAP.
Appendix A-8
"Casualty" shall mean any damage or destruction of all or any portion
of a Property as a result of a fire or other casualty.
"Category" with respect to any Commitment or Loan shall mean a
Commitment or Loan with respect to Series A Loans or Series B Loans, as the case
may be.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, 42 U.S.C. /section/ 9601 et seq., as
amended by the Superfund Amendments and Reauthorization Act of 1986.
"Certificate" shall mean a Certificate in favor of each Holder
evidencing the Holder Fundings made by such Holder and issued pursuant to the
Trust Agreement.
"Change of Control" means (i)the occurrence of any "Change of Control"
as defined in the Existing Aviation Sales Credit Agreement or (ii) if any Person
or group of Persons acting in concert shall own or control, directly or
indirectly, more than 50% of the outstanding ssecurities of the Lessee having
voting rights in the election of directors..
"Claims" shall mean any and all obligations, liabilities, losses,
actions, suits, penalties, claims, demands, costs and expenses (including,
without limitation, reasonable attorney's fees and expenses) of any nature
whatsoever (including without limitation claims brought against the Owner
Trustee by an Indemnified Person pursuant to SECTION 13.5).
"Closing Date" shall mean the Initial Closing Date and each Property
Closing Date.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, or any successor statute thereto.
"Collateral" shall mean all assets of the Lessor or the Lessee, now
owned or hereafter acquired, upon which a lien is purported to be created by the
Security Documents.
"Commitment" shall mean, as to any Lender, the obligation of such
Lender to make Series A Loans or Series B Loans, as the case may be, to the
Borrower hereunder in an aggregate principal amount at any one time outstanding
not to exceed the respective amounts for such Category set forth opposite such
Lender's name on SCHEDULE 1.2 of the Credit Agreement, as such amounts may be
reduced or increased from time to time in accordance with the provisions of this
Agreement, the Credit Agreement or the Lease.
"Commitment Percentage" shall mean, as to any Lender at any time, the
percentage which such Lender's Commitment with respect to a Category of Loans
then constitutes of the aggregate Commitments of all Lenders with respect to the
same Category (or, at any time after the Commitments of any such Category shall
have expired or terminated, the percentage which the aggregate principal amount
of such Lender's Loans of such Category then outstanding constitutes of the
aggregate principal amount of all of the Loans of such Category then
outstanding).
Appendix A-9
"Commitment Period" shall mean the period from the Initial Closing Date
to and including the Construction Period Termination Date, or such earlier date
as the Commitments shall terminate as provided in the Credit Agreement.
"Completed Property" shall mean a Property for which Completion has
occurred or will occur on the date of determination or on the respective
Property Closing Date.
"Completion" shall mean, with respect to a Property, such time as final
completion of the Improvements on such Property has been achieved in accordance
with the Plans and Specifications (excluding punch list items), the Agency
Agreement and the Lease, and in compliance in all material respects with all
Legal Requirements and Insurance Requirements, a certificate of occupancy has
been issued with respect to such Property by the appropriate Governmental
Authority, and no additional Fundings are needed for such Property. If the
Lessor purchases a Property that includes existing Improvements that are to be
immediately occupied by the Lessee, the date of Completion for such Property
shall be the Property Closing Date.
"Completion Date" shall mean, with respect to a Property, the earlier
of (i) the date on which Completion for such Property has occurred, and (ii) the
Construction Period Termination Date. The foregoing notwithstanding, for the
purposes of Section 2.1, 2.6(b), 3.2(a)(x) or 3.3 of the Agency Agreement,
"Completion Date" shall mean, with respect to a Property, the date on which
Completion for such Property has occurred.
"Condemnation" shall mean any taking or sale of the use, access,
occupancy, easement rights or title to any Property or any part thereof, wholly
or partially (temporarily or permanently), by or on account of: (a) any actual
or threatened eminent domain proceeding or other taking of action by any Person
having the power of eminent domain, including any action by a Governmental
Authority to change the grade of, or widen the streets adjacent to, any Property
or alter the pedestrian or vehicular traffic flow to any Property so as to
result in a change in access to such Property, or (b) an eviction by paramount
title or any transfer made in lieu of any such proceeding or action.
"Consistent Basis" in reference to the application of GAAP means the
accounting principles observed in the period referred to are comparable in all
material respects to those applied in the preparation of the audited financial
statements of Aviation Sales referred to in SECTION 7.3(F).
"Consolidated EBITDA" means, with respect to Aviation Sales and its
Subsidiaries for any Four-Quarter Period ending on the date of computation
thereof, the SUM of, without duplication, (i) Consolidated Net Income, (ii)
Consolidated Interest Expense, (iii) taxes on income, (iv) amortization, (v)
depreciation, all determined on a consolidated basis in accordance with GAAP
applied on a Consistent Basis; PROVIDED, HOWEVER, that with respect to an
Acquisition that is accounted for as a "purchase", for the four (4) Four-Quarter
Periods ending next following the date of such Acquisition, Consolidated EBITDA
shall include the results of operations of the Person or assets so acquired,
which amounts shall be determined on a
Appendix A-10
historical pro forma basis as if such Acquisition had been consummated as a
"pooling of interests".
"Consolidated Fixed Charge Ratio" means, with respect to Aviation Sales
and its Subsidiaries for any Four-Quarter Period ending on the date of
computation thereof, the ratio of (i) Consolidated EBITDA plus Basic Rent for
such period less (without duplication) Capital Expenditures for such period to
(ii) Consolidated Fixed Charges for such period.
"Consolidated Fixed Charges" means, with respect to Aviation Sales and
its Subsidiaries for any Four-Quarter Period ending on the date of computation
thereof, the SUM of, without duplication, (i) Consolidated Interest Expense,
(ii) one-twentieth (1/20) of average daily outstanding Property Cost, (iii)
current maturities of Consolidated Indebtedness, (iv) income taxes accrued
during such period, and (v) all dividends and other distributions (other than
distributions in the form of capital stock of Aviation Sales) paid during such
period (regardless of when declared) on any shares of capital stock of Aviation
Sales then outstanding, all determined on a consolidated basis in accordance
with GAAP applied on a Consistent Basis; PROVIDED, HOWEVER, that with respect to
an Acquisition that is accounted for as a "purchase", for the four (4)
Four-Quarter Periods ending next following the date of such Acquisition,
Consolidated Fixed Charges shall include the Consolidated Fixed Charges of the
Person or assets so acquired, which amounts shall be determined on a historical
pro forma basis as if such Acquisition had been consummated as a "pooling of
interests"..
"Consolidated Funded Debt" means all Funded Debt of Aviation Sales and
its Subsidiaries, determined on a consolidated basis.
"Consolidated Funded Debt-to-EBITDA Ratio" means, as of the date of
computation thereof, the ratio of (i) the sum of (without duplication)
Consolidated Funded Debt (determined as at such date) to (ii) Consolidated
EBITDA (for the Four-Quarter Period ending on (or most recently ended prior to)
such date).
"Consolidated Interest Expense" means, with respect to any period of
computation thereof, (a) the sum of the gross interest expense of Aviation Sales
and its Subsidiaries, including without limitation (i) the current amortized
portion of debt discounts to the extent included in gross interest expense, (ii)
the current amortized portion of all fees (including fees payable in respect of
any Hedge Agreement) payable in connection with the incurrence of Indebtedness
to the extent included in gross interest expense and (iii) the portion of any
payments made in connection with Capital Leases allocable to interest expense,
plus (b) Synthetic Lease Basic Rent of Aviation Sales and its Subsidiaries, all
determined on a consolidated basis in accordance with GAAP applied on a
Consistent Basis.
"Consolidated Lease Payments" means the gross amount of all lease or
rental payments, whether or not characterized as rent, of Aviation Sales and its
Subsidiaries, excluding payments in respect of Capital Leases constituting
Indebtedness, all determined on a consolidated basis in accordance with GAAP
applied on a Consistent Basis.
Appendix A-11
"Consolidated Net Income" means, for any period of computation thereof,
the gross revenues from operations of Aviation Sales and its Subsidiaries
(including payments received by Aviation Sales and its Subsidiaries of (i)
interest income, and (ii) dividends and distributions made in the ordinary
course of their businesses by Persons in which investment is permitted pursuant
to the Operating Agreements and not related to an extraordinary event), less all
operating and non-operating expenses of Aviation Sales and its Subsidiaries
including taxes on income, all determined on a consolidated basis in accordance
with GAAP applied on a Consistent Basis; but excluding (for all purposes other
than compliance with SECTION 28.4(A)) as income: (i) net gains on the sale,
conversion or other disposition of capital assets, (ii) net gains on the
acquisition, retirement, sale or other disposition of capital stock and other
securities of Aviation Sales or its Subsidiaries, (iii) net gains on the
collection of proceeds of life insurance policies, (iv) any write-up of any
asset, and (v) any other net gain or credit of an extraordinary nature as
determined in accordance with GAAP applied on a Consistent Basis.
"Consolidated Senior Debt" shall mean the Senior Debt of Aviation Sales
and its Subsidiaries, determined on a consolidated basis in accordance with GAAP
applied on a Consistent Basis.
"Consolidated Shareholders' Equity" means, as of any date on which the
amount thereof is to be determined, the sum of the following in respect of
Aviation Sales and its Subsidiaries (determined on a consolidated basis and
excluding any upward adjustment after the Initial Closing Date due to
revaluation of assets): (i) the amount of issued and outstanding share capital,
plus (ii) the amount of additional paid-in capital and retained earnings (or, in
the case of a deficit, minus the amount of such deficit), plus (iii) the amount
of any foreign currency translation adjustment (if positive, or, if negative,
minus the amount of such translation adjustment), minus (iv) the amount of any
treasury stock, all as determined in accordance with GAAP applied on a
Consistent Basis.
"Consolidated Tangible Net Worth" means, as of any date on which the
amount thereof is to be determined, Consolidated Shareholders' Equity minus
(without duplication of deductions in respect of items already deducted in
arriving at surplus and retained earnings) the net book value of all assets
which would be treated as intangible assets, such as (without limitation)
goodwill (whether representing the excess of cost over book value of assets
acquired or otherwise), capitalized expenses, unamortized debt discount and
expense, consignment inventory rights, patents, trademarks, trade names,
copyrights, franchises and licenses, all as determined on a consolidated basis
in accordance with GAAP applied on a Consistent Basis.
"Construction Agent" shall mean Aviation Sales , as construction agent
under the Agency Agreement.
"Construction Agent Options" shall have the meaning given to such term
in SECTION 2.1 of the Agency Agreement.
Appendix A-12
"Construction Budget" shall mean, with respect to any Property, the
cost of constructing and developing any Improvements on such Property as
determined by the Construction Agent in its reasonable, good faith judgment.
"Construction Commencement Date" shall mean, with respect to
Improvements, the date on which construction of such Improvements commences
pursuant to the Agency Agreement.
"Construction Consultant" means ▇▇▇▇▇▇ Construction Consultants or any
other construction consultant approved by the Agent in its sole discretion.
"Construction Funding" shall mean an advance of funds (consisting of
Loans by the Lenders and Holder Fundings by the Holders) on a specified date to
pay Property Costs pursuant to SECTION 5.4 OR 5.5 of the Participation
Agreement.
"Construction Loan" shall mean any Loan made in connection with and as
part of a Construction Funding .
"Construction Loan Property Cost" shall mean, with respect to each
Construction Period Property at any date of determination, an amount equal to
(a) the aggregate principal amount of Construction Loans and Interest Payment
Loans made on or prior to such date with respect to such Property minus (b) the
aggregate principal amount of prepayments or repayments, as the case may be, of
the Loans allocated to reduce the Construction Loan Property Cost of such
Property pursuant to SECTION 2.6(C) of the Credit Agreement.
"Construction Period" shall mean, with respect to a Property, the
period commencing on the Construction Commencement Date for such Property and
ending on the Completion Date for such Property.
"Construction Period Property" shall mean, at any date of
determination, any Property as to which the Basic Rent Commencement Date has not
occurred on or prior to such date.
"Construction Period Termination Date" shall mean the earlier of (i)
the date that the Commitments have been terminated in their entirety in
accordance with the terms of Section 2.5(a) of the Credit Agreement, or (ii)
December 17, 2000.
"Contaminant" shall have the meaning given to such term in SECTION 1.01
of the Existing Aviation Sales Credit Agreement.
"Contractual Obligation" shall mean, as to any Person, any provision of
any security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Control" (including the correlative meanings of the terms "controlled
by" and "under common control with"), as used with respect to any Person, shall
mean the possession directly or
Appendix A-13
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or
by contract or otherwise.
"Co-Owner Trustee" shall have the meaning specified in SECTION 9.2 of
the Trust Agreement.
"Credit Agreement" shall mean the Credit Agreement, dated as of the
Initial Closing Date, among the Lessor, the Agent, and the Lenders, as specified
therein, as such agreement may be amended, modified, restated or supplemented
from time to time in accordance with the terms thereof.
"Credit Agreement Default" shall mean any event or condition which,
with the lapse of time or the giving of notice, or both, would constitute a
Credit Agreement Event of Default.
"Credit Agreement Event of Default" shall mean any event or condition
defined as an "Event of Default" in Section 6 of the Credit Agreement.
"Credit Documents" shall mean the Credit Agreement, the Notes, and the
Security Documents.
"Deed" shall mean a warranty deed regarding Land or Improvements in
form and substance satisfactory to the Owner Trustee, the Holders and the Agent.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"DOL" shall have the meaning given to such term in SECTION 1.01 of the
Existing Aviation Sales Credit Agreement.
"Dollars" and "$" shall mean dollars in lawful currency of the United
States of America.
"Election Notice" shall have the meaning given to such term in SECTION
20.1 of the Lease.
"Environmental Claim" shall mean any investigation, notice, violation,
demand, allegation, action, suit, injunction, judgment, order, consent decree,
penalty, fine, lien, proceeding, or claim (whether administrative, judicial, or
private in nature) arising (a) pursuant to, or in connection with, any actual or
alleged violation of, any Environmental Law, (b) in connection with any
Hazardous Substance, (c) from or with respect to any abatement, removal,
remedial, corrective, or other response action in connection with a Hazardous
Material, Environmental Law, or other similar order of a Governmental Authority
or (d) from or with respect to any actual or alleged damage, injury, threat, or
harm to health, safety, natural resources, or the environment.
"Environmental, Health or Safety Requirement of Law" shall have the
meaning given to such term in SECTION 1.01 of the Existing Aviation Sales Credit
Agreement.
Appendix A-14
"Environmental Indemnity" means any indemnity pursuant to SECTION 13.3,
or any indemnity with respect to an Environmental Claim.
"Environmental Law" shall mean any Law, permit, consent, approval,
license, award, or other authorization or requirement of any Governmental
Authority relating to emissions, discharges, releases, threatened releases of
any Hazardous Substance into ambient air, surface water, ground water, publicly
owned treatment works, septic system, or land, or otherwise relating to the
handling, storage, treatment, generation, use, emission or disposal of any
Hazardous Substance or pollution or to the protection of health or the
environment, including without limitation CERCLA, the Resource Conservation and
Recovery Act, 42 U.S.C. /section/ 6901, et seq., and state or local statutes
analogous thereto.
"Environmental Lien" shall have the meaning given to such term in
SECTION 1.01 of the Existing Aviation Sales Credit Agreement.
"Environmental Violation" shall mean any activity, occurrence or
condition that violates or threatens to violate (if the threat requires
correction or remediation under any Environmental Law and is not corrected or
remediated during any grace period allowed under such Environmental Law) or
results in or threatens (if the threat requires correction or remediation under
any Environmental Law and is not corrected or remediated during any grace period
allowed under such Environmental Law) to result in noncompliance with any
Environmental Law.
"Equipment" shall mean equipment, apparatus, furnishings, fittings and
personal property of every kind and nature whatsoever purchased, leased or
otherwise acquired using the proceeds of the Loans or the Holder Fundings by the
Construction Agent, the Lessee or the Lessor as specified or described in either
a Requisition or a Lease Supplement, whether or not now or subsequently attached
to, contained in or used or usable in any way in connection with any operation
of any Improvements or other improvements to real property, including without
limitation, all equipment described in the Appraisal, all heating, electrical,
and mechanical equipment, lighting, switchboards, plumbing, ventilation, air
conditioning and air-cooling apparatus, refrigerating, and incinerating
equipment, escalators, elevators, loading and unloading equipment and systems,
sprinkler systems and other fire prevention and extinguishing apparatus and
materials, security systems, motors, engines, machinery, pipes, pumps, tanks,
conduits, fittings and fixtures of every kind and description.
"Equipment Schedule" shall mean (a) each Equipment Schedule attached to
the applicable Requisition and (b) each Equipment Schedule attached to the
applicable Lease Supplement as Schedule I-A.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"ERISA Affiliate" shall mean each entity required to be aggregated with
the Lessee pursuant to the requirements of SECTION 414(B) OR (C) of the Code.
Appendix A-15
"Eurodollar Funding" shall mean a Funding that bears interest (with
respect to the Loans included therein) and Holder Yield (with respect to the
Holder Fundings included therein) based on the Eurodollar Rate.
"Eurodollar Holder Funding" shall mean a Holder Funding bearing a
Holder Yield based on the Eurodollar Rate.
"Eurodollar Loans" shall mean Loans the rate of interest applicable to
which is based upon the Eurodollar Reserve Rate.
"Eurodollar Rate" or "Eurodollar Reserve Rate" shall mean the interest
rate per annum calculated according to the following formula:
Eurodollar = INTERBANK OFFERED RATE + Applicable
----------------------
Rate 1 - Reserve Requirement Margin
"Event of Default" shall mean a Lease Event of Default, a Guaranty
Event of Default, an Agency Agreement Event of Default or a Credit Agreement
Event of Default.
"Excepted Payments" shall mean:
(a) all indemnity payments (including indemnity payments made pursuant
to SECTION 13 of the Participation Agreement), whether made by adjustment to
Basic Rent or otherwise, to which the Owner Trustee, any Holder or any of their
respective Affiliates, agents, officers, directors or employees is entitled;
(b) any amounts (other than Basic Rent, Termination Value, or Purchase
Option Price) payable under any Operative Agreement to reimburse the Owner
Trustee, any Holder or any of their respective Affiliates for performing or
complying with any of the obligations of the Lessee under and as permitted by
any Operative Agreement (including without limitation any reimbursement of the
reasonable expenses of the Owner Trustee, the Trust Company and the Holders
incurred in connection with any such payment);
(c) any amount payable to a Holder by any transferee of such interest
of a Holder as the purchase price of such Holder's interest in the Trust Estate
(or portion thereof);
(d) any insurance proceeds (or payments with respect to risks
self-insured or policy deductibles) under liability policies other than such
proceeds or payments payable to the Agent or any Lender;
(e) any insurance proceeds under policies maintained by the Owner
Trustee or any Holder other than such proceeds payable to the Agent or any
Lender;
(f) Transaction Expenses or other amounts or expenses paid or payable
to or for the benefit of the Owner Trustee or any Holder;
Appendix A-16
(g) all right, title and interest of any Holder or the Owner Trustee to
any Property or any portion thereof or any other property to the extent any of
the foregoing has been released from the Liens of the Security Documents and the
Lease pursuant to the terms thereof;
(h) upon termination of the Credit Agreement pursuant to the terms
thereof, all remaining property covered by the Lease or Security Documents;
(i) all payments in respect of the Holder Yield;
(j) any payments in respect of interest to the extent attributable to
payments referred to in clauses (a) through (i) above; and
(k) any rights of either the Owner Trustee or Trust Company to demand,
collect, ▇▇▇ for or otherwise receive and enforce payment of any of the
foregoing amounts, provided that such rights shall not include the right to
terminate the Lease.
"Excepted Rights" shall mean the rights retained by the Owner Trustee
pursuant to SECTION 8.2(A) of the Credit Agreement.
"Excess Proceeds" shall mean the excess, if any, of the aggregate of
all awards, compensation or insurance proceeds payable in connection with a
Casualty or Condemnation over the Termination Value paid by the Lessee pursuant
to the Lease with respect to such Casualty or Condemnation.
"Existing Credit Agent" shall mean the "Agent" as defined in the
Existing Aviation Sales Credit Agreement.
"Existing Aviation Sales Credit Agreement" means that certain Third
Amended and Restated Credit Agreement dated as of October 17, 1997, as amended
by Amendment No. 1 thereto dated as of March 31, 1998, Amendment No. 2 and
Consent thereto dated as of September 18, 1998, Amendment No. 3 dated as of
November 24, 1998 and Amendment No. 4 dated as of December 16, 1998, among
Aviation Sales Operating Company, Aerocell Structures, Inc, AVS/▇▇▇▇▇-▇▇▇▇▇
Machine Company, Whitehall Corporation and Triad International Maintenance
Corporation, as borrowers, Aviation Sales, the lenders party thereto, Citicorp
USA, Inc., as agent and Citicorp Securities, Inc., as arranger
"Expected Maximum Property Cost" at any time shall mean the sum of (a)
the then outstanding aggregate Property Cost of all Properties (whether or not
subject to the Lease), plus (b) the maximum total additional Property Cost
expected to be advanced or incurred, on such date or at any time thereafter,
with respect to any Properties (including without limitation any expected
Acquisition Funding, Contribution Funding or other expected Property Costs, and
including without limitation any expected Property Cost referred to in a
Construction Budget).
"Expiration Date" shall mean the Basic Term Expiration Date.
Appendix A-17
"Expiration Date Purchase Option" shall mean the Lessee's option to
purchase all (but not less than all) of the Properties on the Expiration Date.
"Fair Market Sales Value" shall mean, with respect to any Property, the
amount, which in any event, shall not be less than zero, that would be paid in
cash in an arms-length transaction between an informed and willing purchaser and
an informed and willing seller, neither of whom is under any compulsion to
purchase or sell, respectively, such Property. Fair Market Sales Value of any
Property shall be determined based on the assumption that, except for purposes
of SECTION 17 of the Lease, such Property is in the condition and state of
repair required under SECTION 10.1 of the Lease and the Lessee is in compliance
with the other requirements of the Operative Agreements.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided that (a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to the Agent (in its
individual capacity) on such day on such transactions as determined by the
Agent.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System or any successor thereto.
"Fee Letter" shall mean that certain letter agreement dated October 14,
1998 between Aviation Sales and NMS.
"Finance Affiliate Indebtedness" shall have the meaning given to such
term in SECTION 1.01 of the Existing Aviation Sales Credit Agreement.
"Fiscal Quarter" means any quarter of a Fiscal Year.
"Fiscal Year" means any period of twelve consecutive calendar months
ending on the December 31; references to a Fiscal Year with a number
corresponding to any calendar year (E.G., the "1996 Fiscal Year") refer to the
Fiscal Year ending on December 31 of such calendar year.
"Fixtures" shall mean all fixtures relating to the Improvements,
including all components thereof, located in or on the Improvements, together
with all replacements, modifications, alterations and additions thereto.
"Force Majeure Event" shall mean any event beyond the control of the
Construction Agent, other than a Casualty or Condemnation, including, but not
limited to, strikes or lockouts (but only when the Construction Agent is legally
prevented from securing replacement labor or
Appendix A-18
materials as a result thereof), adverse soil conditions, acts of God, adverse
weather conditions, inability to obtain labor or materials after all possible
efforts have been expended by the Construction Agent, governmental activities,
civil commotion and enemy action; but excluding any event, cause or condition
that results from the Construction Agent's financial condition.
"Foreign Subsidiary" shall have the meaning given to such term in
SECTION 1.01 of the Existing Aviation Sales Credit Agreement.
"Four-Quarter Period" shall have the meaning given to such term in the
Existing Aviation Sales Credit Agreement.
"Funded Debt" means, with respect to any Person, the sum of, without
duplication, (i) Indebtedness of such Person and its Subsidiaries for borrowed
money (determined in accordance with GAAP), including, without limitation,
Indebtedness under Capital Leases (as defined in the Existing Aviation Sales
Credit Agreement), and (ii) Synthetic Lease Indebtedness of such Person and its
Subsidiaries.
"Funding" shall mean a Construction Funding, an Acquisition Funding, or
any other advance of funds (consisting of Loans by the Lenders and Holder
Fundings by the Holders).
"GAAP" shall mean "Generally Accepted Accounting Principles" as defined
in the Existing Aviation Sales Credit Agreement.
"Governmental Action" shall mean all permits, authorizations,
registrations, consents, approvals, waivers, exceptions, variances, orders,
judgments, written interpretations, decrees, licenses, exemptions, publications,
filings, notices to and declarations of or with, or required by, any
Governmental Authority, or required by any Legal Requirement, and shall include,
without limitation, all environmental and operating permits and licenses that
are required for the full use, occupancy, zoning and operation of any Property.
"Governmental Authority" shall mean any nation or government, any state
or other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, including without limitation any court or governmental body,
agency, department, commission, board, bureau or instrumentality of a
governmental body.
"Ground Lease" shall mean (a) a ground lease (in form and substance
satisfactory to the Agent and the Lessor) with respect to any Property owned by
the Lessee and leased to the Lessor where such lease has a ninety-nine year term
and payments set at $1.00 per year, or (b) a ground lease or ground sub-lease of
any Property by any Person to the Lessor, where such lease or sublease (as well
as any other lease or sub-lease with respect to such Property) is in form and
substance, and contains such terms and conditions, as are satisfactory in all
respects to the Agent and the Lessor.
Appendix A-19
"Guarantors" shall mean, collectively, Aviation Sales and each of the
Subsidiaries of Aviation Sales.
"Guaranty Agreement" or "Guaranty" shall mean, collectively, (a) the
Guaranty Agreement (Series A Obligations) dated as of the Initial Closing Date
among each Guarantor and the Agent, (b) the Guaranty Agreement dated as of the
Initial Closing Date by each Guarantor (other than Aviation Sales) to the
Lessor, the Agent, the Lenders and the Holder, and (c) any other Guaranty
Agreement by any Guarantor in favor of the Lessor, the Agent, the Lenders and
the Holders, as each such agreement may be amended, supplemented, restated or
modified from time to time in accordance with the terms thereof.
"Guaranty Event of Default" shall mean any an "Event of Default" as
defined in the Guaranty Agreement.
"Hazardous Substance" shall mean any of the following: (i) any
petroleum or petroleum product, explosives, radioactive material, asbestos,
formaldehyde, polychlorinated biphenyls, lead and radon gas; (ii) any substance,
material, product, derivative, compound or mixture, mineral, chemical, waste,
gas, medical waste, or pollutant, in each case whether naturally occurring,
man-made or the by-product of any process, that is toxic, harmful or hazardous
to the environment or human health or safety as determined in accordance with
any Environmental Law; or (iii) any substance, material, product, derivative,
compound or mixture, mineral, chemical, waste, gas, medical waste or pollutant
that would support the assertion of any claim under any Environmental Law,
whether or not defined as hazardous as such under any Environmental Law.
"Hedge Agreement" shall have the meaning specified in the Existing
Aviation Sales Credit Agreement.
"Hedging Obligations" shall mean, with respect to any Person, all
liabilities of such Person under interest rate swap agreements, interest rate
cap agreements and interest rate collar agreements, and all other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates or currency exchange rates.
"Holder Amount" shall mean as of any date, the aggregate amount of
Holder Fundings made by each Holder to the Trust Estate pursuant to SECTION 2 of
the Participation Agreement or SECTION 3.1 of the Trust Agreement less any
payments of any Holder Fundings received by the Holders pursuant to SECTION 3.4
of the Trust Agreement.
"Holder Applicable Margin" shall mean a rate per annum equal to
three-fourths of one percent (.75%).
"Holder Commitment" shall mean, as to any Holder, the obligation of
such Holder to make Holder Fundings to the Lessor in an aggregate principal
amount at any time outstanding not to exceed the respective amount set forth
opposite such Holder's name on Schedule 1, as such amounts may be increased or
reduced from time to time in accordance with the provisions of this Agreement,
the Trust Agreement or the Lease.
Appendix A-20
"Holder Commitments" shall mean the aggregate of all Holder
Commitments.
"Holder Construction Property Cost" shall mean, with respect to any
Construction Period Property at any date of determination, an amount equal to
(a) the outstanding Holder Fundings made on or prior to such date in connection
with and as part of any Construction Funding for such Property, PLUS (b) the
outstanding Holder Fundings made on or prior to such date to fund the payment of
Allocated Holder Return with respect to such Property, MINUS (c) the aggregate
principal amount of prepayments or repayments, as the case may be, of Holder
Fundings described in clause (a) or clause (b).
"Holder Funding" shall mean any Funding made by any Holder to the Owner
Trustee pursuant to the terms of the Trust Agreement or the Participation
Agreement.
"Holder Overdue Rate" shall mean the rate specified in SECTION 3.13 of
the Trust Agreement.
"Holder Property Cost" shall mean with respect to a Property an amount
equal to the outstanding Holder Fundings with respect thereto (including Holder
Fundings with respect to Allocated Return allocated to such Property).
"Holder Unused Fee" shall mean, at any time, the product of (a) the
Applicable Unused Fee Rate, MULTIPLIED BY (b) the average daily amount by which
(i) the aggregate Holder Commitments of the Holders (under the Operative
Agreements) exceeds (ii) the aggregate outstanding principal amount of Holder
Fundings.
"Holder Yield" shall mean with respect to Holder Fundings from time to
time either the Eurodollar Rate (including the Applicable Margin) plus the
Holder Applicable Margin, or the Base Rate plus the Holder Applicable Margin, as
elected by the Owner Trustee from time to time with respect to such Holder
Fundings in accordance with the terms of the Trust Agreement; PROVIDED, HOWEVER,
that (i) upon delivery of the notice described in SECTION 3.7(C) of the Trust
Agreement, the outstanding Holder Fundings of each Holder shall bear a yield at
the Base Rate plus the Holder Applicable Margin from time to time from and after
the dates and during the periods specified in SECTION 3.7(C) of the Trust
Agreement, and (ii) upon the delivery by a Holder of the notice described in
SECTION 3.9(E) of the Trust Agreement or as otherwise set forth in SECTION 3.8
of the Trust Agreement, the Holder Fundings of such Holder shall bear a yield at
the Base Rate plus the Holder Applicable Margin applicable from time to time
after the dates and during the periods specified in SECTION 3.9(E) or 3.8 (as
the case may be) of the Trust Agreement.
"Holders" shall mean the several banks and other financial institutions
which are from time to time holders of Certificates in connection with the
Aviation Sales Trust 1998-1.
"Impositions" shall mean, except to the extent described in the
following sentence, any and all liabilities, losses, expenses, costs, charges
and Liens of any kind whatsoever for fees, taxes, levies, imposts, duties,
charges, assessments or withholdings ("Taxes") including without limitation (i)
any real and personal property taxes, including personal property taxes on any
Appendix A-21
property covered by the Lease that is classified by Governmental Authorities as
personal property, frontage taxes and real estate or ad valorem taxes in the
nature of property taxes; (ii) any sales taxes, use taxes and other similar
taxes (including rent taxes and intangibles taxes); (iii) any excise taxes; (iv)
any real estate transfer taxes, conveyance taxes, mortgage taxes, stamp taxes
and documentary recording taxes and fees; (v) any taxes that are or are in the
nature of franchise, income, value added, privilege and doing business taxes,
license and registration fees; (vi) any assessments on any Property, including
all assessments for public Improvements or benefits, whether or not such
improvements are commenced or completed within the Term; and (vii) any tax,
Lien, assessment or charge asserted, imposed or assessed by the PBGC or any
governmental authority succeeding to or performing functions similar to, the
PBGC; and in each case all interest, additions to tax and penalties thereon,
which at any time prior to, during or with respect to the Term or in respect of
any period for which the Lessee shall be obligated to pay Supplemental Rent, may
be levied, assessed or imposed by any Governmental Authority upon or with
respect to (a) any Property or any part thereof or interest therein; (b) the
leasing, financing, refinancing, demolition, construction, substitution,
subleasing, assignment, control, condition, occupancy, servicing, maintenance,
repair, ownership, possession, activity conducted on, delivery, insuring, use,
operation, improvement, transfer of title, return or other disposition of any
Property or any part thereof or interest therein; (c) the Certificates or the
Notes or other indebtedness with respect to any Property or any part thereof or
interest therein; (d) the rentals, receipts or earnings arising from any
Property or any part thereof or interest therein; (e) the Operative Agreements,
the performance thereof, or any payment made or accrued pursuant thereto; (f)
the income or other proceeds received with respect to any Property or any part
thereof or interest therein upon the sale or disposition thereof; (g) any
contract (including the Agency Agreement) relating to the construction,
acquisition or delivery of the Improvements or any part thereof or interest
therein; (h) the issuance of the Certificates or the Notes; or (i) otherwise in
connection with the transactions contemplated by the Operative Agreements.
The term "Imposition" shall not mean or include:
(i) Taxes and impositions (other than Taxes that are, or are
in the nature of, withholding, sales, use, rental, value added,
transfer or property taxes) that are imposed on an Indemnified Person
(other than Lessor) by the United States federal government or (in the
case of a Person organized under the laws of a foreign country) by a
Governmental Authority of such country, and that are in each case based
on or measured by the net income (including taxes based on capital
gains and minimum taxes or franchise taxes) of such Person; PROVIDED
that this clause (i) shall not apply to (and shall not exclude) any Tax
or imposition imposed with respect to a payment (including any Rent
payment) except for (A) the portion of such payment constituting
interest on a Loan or Holder Yield or (B) any such Tax or imposition to
the extent it arises because an Indemnified Person has previously
written off as uncollectible (and reduced the tax basis for) an
Obligation which it has subsequently collected, and PROVIDED, FURTHER
that this clause (i) shall not be interpreted to prevent a payment from
being made on an After Tax Basis if such payment is otherwise required
to be so made;
Appendix A-22
(ii) Taxes and impositions (other than Taxes that are, or are
in the nature of, sales, use, rental, value added, transfer or property
taxes) that are imposed on any Indemnified Person (other than Lessor)
by any state or local jurisdiction or taxing authority within any state
or local jurisdiction and that are based upon or measured by the net
income or net receipts; PROVIDED that this clause (ii) shall not apply
to (and shall not exclude) (A) any Tax or imposition imposed with
respect to a payment (including any Rent payment) except for (I) the
portion of such payment constituting interest on a Loan or Holder Yield
or (II) any such Tax or imposition to the extent it arises because an
Indemnified Person has previously written off (and reduced the tax
basis for) an Obligation which it has subsequently collected, or (B)
any Tax or imposition imposed on an Indemnified Person by any state or
local jurisdiction if such Tax or imposition would not arise as to such
Person but for the location, possession or use of any Property in such
jurisdiction; and PROVIDED, FURTHER, that this clause (ii) shall not be
interpreted to prevent a payment from being made on an After Tax Basis
if such payment is otherwise required to be so made;
(iii) any Tax or imposition to the extent, but only to such
extent, it relates to any act, event or omission that occurs after the
termination of the Lease and redelivery or sale of the property in
accordance with the terms of the Lease (but not any Tax or imposition
that relates to such termination, redelivery or sale or to any period
prior to such termination, redelivery or sale); or
(iv) any Taxes which are imposed on an Indemnified Person as a
result of the gross negligence or willful misconduct of such
Indemnified Person itself (as opposed to any gross negligence or
willful misconduct imputed to such Indemnified Person), but not Taxes
imposed as a result of the ordinary negligence of such Person.
Any Tax or imposition excluded from the defined term "Imposition" by any one of
the foregoing clauses (i) through (iv) shall not be construed as constituting an
Imposition by any provision of any other of the aforementioned clauses.
"Improvements" shall mean, with respect to the construction, renovation
or Modification of a Property, all buildings, structures, Fixtures, and other
improvements of every kind existing at any time and from time to time on or
under the Land purchased, leased or otherwise acquired using the proceeds of the
Loans or the Holder Fundings, together with any and all appurtenances to such
buildings, structures or improvements, including sidewalks, utility pipes,
conduits and lines, parking areas and roadways, and including all Modifications
and other additions to or changes in the Improvements at any time, including
without limitation (a) any Improvements existing as of the Property Closing Date
as such Improvements may be referenced on the applicable Requisition and (b) any
Improvements made subsequent to such Property Closing Date.
"Indebtedness" shall have the meaning assigned thereto in the Existing
Aviation Sales Credit Agreement.
Appendix A-23
"Indemnified Person" shall mean each of the Lessor, the Owner Trustee,
in its individual and its trust capacity, the Agent, NMS, the Holders, the
Lenders and their respective successors, assigns, directors, shareholders,
partners, officers, employees, agents and Affiliates.
"Indemnity Provider" shall mean, collectively, the Construction Agent,
the lessee and the Guarantors, whose obligations as Indemnity Provider under the
Operative Agreements shall be joint and several.
"Initial Closing Date" shall mean the date of the Participation
Agreement.
"Initial Construction Funding" shall mean any initial Funding to pay
for: (i) Property Costs for construction of any Improvements; and (ii) the
Property Costs of restoring or repairing any Property which is required to be
restored or repaired in accordance with SECTION 15.1(E) of the Lease.
"Insurance Requirements" shall mean (a) all terms and conditions of any
insurance policy either required by the Lease to be maintained by the Lessee or
required by the Agency Agreement to be maintained by the Construction Agent, and
(b) all requirements of the issuer of any such policy.
"Interbank Offered Rate" or "Applicable Interbank Offered Rate" shall
mean, with respect to any Eurodollar Rate Loan or Eurodollar Holder Funding for
the Interest Period applicable thereto, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any
successor page) as the London interbank offered rate for deposits in Dollars at
approximately 11:00 A.M. (London time) two Business Days prior to the first day
of such Interest Period for a term comparable to such Interest Period. If for
any reason such rate is not available, the term "Interbank Offered Rate" shall
mean, with respect to any Eurodollar Rate Loan or Eurodollar Holder Funding for
the Interest Period applicable thereto, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as
the London interbank offered rate for deposits in Dollars at approximately 11:00
A.M. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period, PROVIDED, HOWEVER; if more
than one rate is specified on Reuters Screen LIBO Page, the applicable rate
shall be the arithmetic mean of all such rates.
"Interest Payment Loan" shall mean any Loan made to fund the payment of
Allocated Interest with respect to a Construction Period Property.
"Interest Period" shall mean, for each Eurodollar Loan and Eurodollar
Holder Fundings for a specified Property (a) prior to the Completion Date for
such Property, the period beginning on the date the first Eurodollar Loan (and
related Eurodollar Holder Funding) are extended, continued or converted pursuant
to the terms of the Operative Agreements and ending one month later, and
thereafter, the period commencing on the last day of the preceding Interest
Period and ending one month later, and (b) during the period from and after the
Completion Date for such Property, (i) initially, the period commencing on the
conversion or continuation date, as the case may be, with respect to such
Eurodollar Loan or Eurodollar Holder Funding and ending, in the
Appendix A-24
case of any Eurodollar Loan or Eurodollar Holder Funding, one, two or three
months thereafter, as selected by the Borrower (in the case of a Eurodollar
Loan) or the Owner Trustee (in the case of a Eurodollar Holder Funding) in its
notice of borrowing, Funding, continuation or conversion, as the case may be,
given with respect thereto; and (ii) thereafter, each period commencing on the
last day of the next preceding Interest Period applicable to such Eurodollar
Loan or Eurodollar Holder Funding and ending one, two or three months
thereafter, as selected by the Borrower by irrevocable notice to Administrative
Agent (in the case of a Eurodollar Loan) or by the Owner Trustee by irrevocable
notice to the Holders (in the case of a Eurodollar Holder Funding) in each case
not less than three Business Days prior to the last day of the then current
Interest Period with respect thereto; PROVIDED, HOWEVER, that all of the
foregoing provisions relating to Interest Periods are subject to the following:
(A) if any Interest Period would end on a day which is not a Business Day, such
Interest Period shall be extended to the next succeeding Business Day (except
that where the next succeeding Business Day falls in the next succeeding
calendar month, then on the next preceding Business Day), (B) no Interest Period
shall extend beyond the Maturity Date, (C) where an Interest Period begins on a
day for which there is no numerically corresponding day in the calendar month in
which the Interest Period is to end, such Interest Period shall end on the last
Business Day of such calendar month, and (D) from and after all the Commitment
Period, on any day the sum of the Interest Periods in effect under the Operative
Agreements for all Eurodollar Loans and Eurodollar Holder Funding shall not
exceed five (5) in the aggregate.
"Investment" shall have the meaning given to such term in SECTION 1.01
of the Existing Aviation Sales Credit Agreement.
"Investment Company Act" shall mean the Investment Company Act of 1940,
as amended, together with the rules and regulations promulgated thereunder.
"IRS" shall mean the United States Internal Revenue Service, or any
successor or analogous organization.
"Land" shall mean (a) a parcel or parcels of real property that is
described on (i) the Requisition issued by the Construction Agent on the
Property Closing Date relating to such parcel or (ii) Schedule I-C to each
applicable Lease Supplement executed and delivered in accordance with the
requirements of SECTION 2.4 of the Lease and, to the extent set forth in any
such Requisition or Schedule, may include without limitation a leasehold
interest (pursuant to a Ground Lease) in such Land, and (b) all Appurtenant
Rights with respect to such Land.
"Law" shall mean any statute, law, ordinance, code, regulation, rule,
directive, order, writ, injunction or decree of any Governmental Authority.
"Lease" or "Lease Agreement" shall mean the Lease Agreement dated as of
the Initial Closing Date, between the Lessor and the Lessee, together with any
Lease Supplements thereto, as such Lease Agreement may from time to time be
supplemented, amended, restated or modified in accordance with the terms
thereof.
Appendix A-25
"Lease Default" shall mean any event or condition which, with the lapse
of time or the giving of notice, or both, would constitute a Lease Event of
Default.
"Lease Event of Default" shall have the meaning specified in SECTION
17.1 of the Lease.
"Lease Supplement" shall mean each Lease Supplement substantially in
the form of Exhibit A to the Lease, together with all attachments and schedules
thereto, as such Lease Supplement may be supplemented, amended, restated or
modified from time to time.
"Leasing Affiliate Liabilities" shall have the meaning given to such
term in SECTION 1.01 of the Existing Aviation Sales Credit Agreement.
"Legal Requirements" shall mean all foreign, Federal, state, county,
municipal and other governmental statutes, laws, rules, orders, regulations,
ordinances, judgments, decrees and injunctions affecting the Owner Trustee, the
Holders, the Agent, any Lender or any Improvements or the taxation, demolition,
construction, use or alteration of such Improvements, whether now or hereafter
enacted and in force, including without limitation any that require appraisals,
repairs, modifications or alterations in or to any Property or in any way limit
the use and enjoyment thereof (including all building, zoning and fire codes and
the Americans with Disabilities Act of 1990, 42 U.S.C. /section/ 12101 et seq.,
and any other similar Federal, state or local laws or ordinances and the
regulations promulgated thereunder) and any that may relate to environmental
requirements (including all Environmental Laws), and all permits, certificates
of occupancy, licenses, authorizations and regulations relating thereto, and all
covenants, agreements, restrictions and encumbrances contained in any
instruments which are either of record or known to the Lessee affecting any
Property or the Appurtenant Rights.
"Lender Financing Statements" shall mean UCC financing statements and
fixture filings appropriately completed and executed for filing in the
applicable jurisdiction in order to evidence or perfect the Agent's security
interest (for itself and on behalf of the Lenders) in any Equipment or in any
Improvements.
"Lenders" shall mean the several banks and other financial institutions
from time to time party to the Credit Agreement.
"Lessee" shall have the meaning set forth in the Lease.
"Lessor" shall mean the Owner Trustee, not in its individual capacity,
but as Lessor under the Lease.
"Lessor Basic Rent" shall mean the scheduled Holder Yield due on the
Holder Fundings on any Scheduled Interest Payment Date pursuant to the Trust
Agreement (but not including interest on (i) any such scheduled Holder Yield due
on the Holder Fundings prior to the Basic Rent Commencement Date with respect to
the Property to which such Holder Fundings relate or (ii) overdue amounts under
the Trust Agreement or otherwise).
Appendix A-26
"Lessor Financing Statements" shall mean UCC financing statements and
fixture filings appropriately completed and executed for filing in the
applicable jurisdictions in order to evidence or perfect the Lessor's interest
under the Lease to the extent the Lease is a security agreement or a mortgage.
"Lessor Lien" shall mean any Lien, true lease or sublease or
disposition of title arising as a result of (a) any claim against the Lessor or
Trust Company, in its individual capacity, not resulting from the transactions
contemplated by the Operative Agreements, (b) any act or omission of the Lessor
or Trust Company, in its individual capacity, which is not required by the
Operative Agreements or is in violation of any of the terms of the Operative
Agreements, (c) any claim against the Lessor or Trust Company, in its individual
capacity, with respect to Taxes or Transaction Expenses against which the Lessee
is not required to indemnify Lessor or Trust Company, in its individual
capacity, pursuant to SECTION 13 of the Participation Agreement or (d) any claim
against the Lessor or Trust Company, in its individual capacity, arising out of
any transfer by the Lessor of all or any portion of the interest of the Lessor
in the Properties, the Trust Estate or the Operative Agreements other than the
transfer of title to or possession of any Properties by the Lessor pursuant to
and in accordance with the Lease, the Credit Agreement, the Security Agreement
or the Participation Agreement or pursuant to the exercise of the remedies set
forth in ARTICLE XVII of the Lease.
"Letter of Credit" shall mean that certain standby letter of credit
dated as of the Initial Closing Date, issued by Citicorp USA, Inc. in favor of
the Lessor and the Agent (for itself and on behalf of the Series A Lenders) and
securing the obligations of the Lessee and the Construction Agent under the
Operative Agreements, as such letter of credit may be amended, modified,
restated or supplemented from time to time.
"Liabilities and Costs" shall have the meaning given to such term in
SECTION 1.01 of the Existing Aviation Sales Credit Agreement.
"Lien" shall mean any mortgage, pledge, security interest, encumbrance,
lien, option or charge of any kind.
"Limited Recourse Amount" shall mean, with respect to any Properties on
an aggregate basis as of a specified date, an amount equal to the sum of the
Termination Values with respect to such Properties on such date, less the
Maximum Residual Guarantee Amount as of such date with respect to the
Properties.
"Loan Basic Rent" shall mean the interest due on the Loans on any
Scheduled Interest Payment Date pursuant to the Credit Agreement (but not
including interest on (i) any such Loan prior to the Basic Rent Commencement
Date with respect to the Property to which such Loan relates or (ii) any overdue
amounts under SECTION 2.8(C) of the Credit Agreement or otherwise).
"Loan Property Cost" shall mean, with respect to each Property at any
date of determination, an amount equal to (a) the aggregate principal amount of
Acquisition Loans, Construction Loans and Interest Payment Loans made on or
prior to such date with respect to
Appendix A-27
such Property minus (b) the aggregate amount of prepayments or repayments as the
case may be of the Loans allocated to reduce the Loan Property Cost of such
Property pursuant to SECTION 2.6(C) of the Credit Agreement.
"Loans" shall mean, collectively, the Series A Loans and the Series B
Loans.
"Majority Lenders" shall mean at any time, Lenders whose Commitment
Percentages represent at least 51% of the aggregate Commitments.
"Marketing Period" shall mean, if the Lessee has given an Election
Notice in accordance with SECTION 20.1 of the Lease, the period commencing on
the date such Sale Notice is given and ending on the Expiration Date.
"Material Adverse Effect" shall mean a material adverse effect on (a)
the business, condition (financial or otherwise) assets, liabilities or
operations of Aviation Sales or any of its Subsidiaries, (b) the ability of the
Lessee, the Construction Agent or any of their Subsidiaries to perform its
respective obligations under any Operative Agreement to which it is a party, (c)
the validity or enforceability of any Operative Agreement or the rights and
remedies of the Agent, the Lenders, the Holders, or the Lessor thereunder, (d)
the validity, priority or enforceability of any Lien on any Property created by
any of the Operative Agreements, or (e) the value, utility or useful life of any
Property or the use, or ability of the applicable Lessee to use, any Property
for the purpose for which it was intended.
"Maturity Date" shall mean December 17, 2003, or such earlier date as
the Lease may terminate.
"Maximum Amount" shall mean:
(a) one hundred percent (100%) of the cost of the Land or the
Ground Lease (as the case may be) for all, but not less than all, of
the Properties (collectively, the "Land Cost"), PLUS
(b) the product of eighty-nine and nine-tenths percent (89.9%)
multiplied by the following: (i) the aggregate Property Cost of all,
but not less than all, of the Properties, minus (ii) the Land Cost,
minus (iii) all structuring fees payable to NMS pursuant to the Fee
Letter, minus (iv) accrued, unpaid Holder Yield respecting any and all
Construction Period Properties, MINUS
(c) the accreted value (calculated at a rate of _______
percent (__%) per annum) of any payments previously made by the
Construction Agent or the Lessee regarding any and all Construction
Period Properties and not reimbursed; PLUS
(d) one hundred percent (100%) of all Rent and other amounts
then due and owing by the Lessee or the Construction Agent pursuant to
the Operative Agreements.
Appendix A-28
"Maximum Property Cost" shall mean the aggregate amount of the Property
Costs for all Properties subject to the Lease as of the applicable determination
date.
"Maximum Residual Guarantee Amount", with respect to any Properties,
shall mean an amount equal to the sum of (a) eighty-eight percent (88%) of the
aggregate Property Cost for all of such Properties plus (b) one hundred percent
(100%) of all Rent and other amounts then due and owing by the Lessee or the
Construction Agent under the Lease and the other Operative Agreements.
"MIS" shall have the meaning given to such term in SECTION 1.01 of the
Existing Aviation Sales Credit Agreement.
"Modifications" shall have the meaning specified in SECTION 11.1(A) of
the Lease.
"Mortgage Instrument" shall mean any mortgage, deed of trust or any
other instrument executed by the Owner Trustee in favor of the Agent and
evidencing a Lien on a Property, in form and substance reasonably acceptable to
the Agent.
"Multiemployer Plan" shall mean any plan described in Section
4001(a)(3) of ERISA to which contributions are or have been made or are required
to be made by Aviation Sales or any of its Subsidiaries or ERISA Affiliates.
"National Accounting Firm" shall mean any of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP,
Deloitte & Touch LLP, Ernst & Young LLP, KPMG Peat Marwick LLP or
PricewaterhouseCoopers LLP.
"NationsBank" shall mean NationsBank, National Association, a national
banking association.
"NMS" means NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities, LLC.
"Net Proceeds" shall mean all amounts paid in connection with any
Casualty or Condemnation, and all interest earned thereon, less the expense of
claiming and collecting such amounts, including all costs and expenses in
connection therewith for which the Agent or Lessor is entitled to be reimbursed
pursuant to the Lease.
"Net Sale Proceeds Shortfall" shall mean the amount by which the
proceeds of a sale described in SECTION 22.1 of the Lease (net of all expenses
of sale) are less than the Limited Recourse Amount with respect to the
Properties if it has been determined that the Fair Market Sales Value of the
Properties at the expiration of the term of the Lease has been impaired by
greater than expected wear and tear during the Term of the Lease.
"Non-Excluded Taxes" shall have the meaning given to such term in
SECTION 2.13 of the Credit Agreement.
"Notes" shall mean, collectively, the Series A Notes and the Series B
Notes.
Appendix A-29
"Occupational Safety and Health Law" shall mean the Occupational Safety
and Health Act of 1970 and any other federal, state or local statute, law,
ordinance, code, rule, regulation, order or decree regulating or relating to, or
imposing liability or standards of conduct concerning, employee health or
safety, as now or at any time hereafter in effect.
"Officer's Certificate" shall mean a certificate signed by any
individual holding the office of vice president or higher, which certificate
shall certify as true and correct the subject matter being certified to in such
certificate.
"Operating Lease" shall have the meaning given to such term in SECTION
1.01 of the Existing Aviation Sales Credit Agreement.
"Operative Agreements" shall mean, collectively, the Participation
Agreement, the Agency Agreement, the Trust Agreement, the Certificates, the
Credit Agreement, the Notes, the Lease (and a memorandum thereof in a form
reasonably acceptable to the Agent), each Lease Supplement (and a memorandum
thereof in a form reasonably acceptable to the Agent), the Guaranty Agreement,
the Security Agreement, the Letter of Credit, the Assignment of Project Rights,
each Ground Lease, each Mortgage Instrument, the Side Letter, the Bridge Note
and any agreements or documents related to the Bridge Note.
"Organizational Documents" shall have the meaning given to such term in
SECTION 1.01 of the Existing Aviation Sales Credit Agreement.
"Overdue Interest" shall mean any interest payable pursuant to SECTION
2.8(C) of the Credit Agreement.
"Overdue Rate" shall mean (i) with respect to Loan Basic Rent, and any
other amount owed under or with respect to the Credit Agreement or the Security
Documents, the rate specified in SECTION 2.8(C) of the Credit Agreement, (ii)
with respect to Lessor Basic Rent, the Holder Yield and any other amount owed
under or with respect to the Trust Agreement, the Holder Overdue Rate and (iii)
with respect to any other amount, the Base Rate plus 2%.
"Owner Trustee" shall mean First Security Bank, National Association,
not individually, except as expressly stated in the various Operative
Agreements, but solely as Owner Trustee under the Aviation Sales Trust 1998-1,
and any successor or replacement Owner Trustee expressly permitted under the
Operative Agreements.
"Participant" shall have the meaning given to such term in SECTION 9.7
of the Credit Agreement.
"Participation Agreement" shall mean the Participation Agreement dated
as of the date hereof among the Construction Agent, the Lessee, the Owner
Trustee, the Holders party thereto, the Lenders party thereto, and the
Administrative Agent, as amended, supplemented, restated or otherwise modified
from time to time in accordance with the terms thereof.
Appendix A-30
"Payment Date" shall mean any Scheduled Interest Payment Date and any
date on which interest or Holder Yield in connection with a prepayment of
principal on the Loans or of the Holder Fundings is due under the Credit
Agreement or the Trust Agreement.
"PBGC" shall mean the Pension Benefit Guaranty Corporation created by
Section 4002(a) of ERISA or any successor thereto.
"Permit" shall have the meaning given to such term in SECTION 1.01 of
the Existing Aviation Sales Credit Agreement.
"Permitted Equity Securities Options" shall have the meaning given to
such term in SECTION 1.01 of the Existing Aviation Sales Credit Agreement.
"Permitted Exceptions" shall mean:
(i) Liens of the types described in clauses (i), (ii) and (v)
of the definition of Permitted Liens;
(ii) Liens for Taxes not yet due; and
(iii) all encumbrances, exceptions, restrictions, easements,
rights of way, servitudes, encroachments and irregularities in title,
other than Liens which, in the reasonable assessment of the Agent,
materially impair the use of any Property for its intended purpose.
"Permitted Liens" shall mean:
(i) the respective rights and interests of the parties to the
Operative Agreements as provided in the Operative Agreements;
(ii) the rights of any sublessee or assignee under a sublease
or an assignment expressly permitted by the terms of the Lease;
(iii) Liens for Taxes that either are not yet due or are being
contested in accordance with the provisions of SECTION 13.1 of the
Lease;
(iv) Liens arising by operation of law, materialmen's,
mechanics', workmen's, repairmen's, employees', carriers',
warehousemen's and other like Liens relating to the construction of the
Improvements or in connection with any Modifications or arising in the
ordinary course of business, which Liens have been bonded (within 20
days of the earlier of the date of filing or the date of Lessee's
knowledge of such liens) for not less than the full amount in dispute
(or as to which other security arrangements satisfactory to the Lessor
and the Agent have been made), which bonding (or arrangements) shall
comply with applicable Legal Requirements, and shall have effectively
stayed any execution or enforcement of such Liens;
Appendix A-31
(v) Liens arising out of judgments or awards with respect to
which appeals or other proceedings for review are being prosecuted in
good faith and for the payment of which adequate reserves have been
provided as required by GAAP or other appropriate provisions have been
made, so long as such proceedings have the effect of staying the
execution of such judgments or awards and satisfy the conditions for
the continuation of proceedings to contest Taxes set forth in SECTION
13.1 of the Lease;
(vi) Liens in favor of municipalities to the extent agreed to
by the Lessor and the Agent; and
(vii) Permitted Exceptions.
"Person" shall mean any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company, limited liability partnership, governmental authority
or any other entity.
"Plan" shall have the meaning given to such term in SECTION 1.01 of the
Existing Aviation Sales Credit Agreement.
"Plans and Specifications" shall mean, with respect to Improvements,
the plans and specifications for such Improvements to be constructed or already
existing, as such Plans and Specifications may be amended, modified or
supplemented from time to time in accordance with the terms of the Participation
Agreement and the Agency Agreement.
"Prime Rate" shall mean the per annum rate of interest established from
time to time by NationsBank as its prime rate, which rate may not be the lowest
rate of interest charged by NationsBank to its customers.
"Property" shall mean, with respect to each real property site that is
acquired, constructed or renovated pursuant to the terms of the Operative
Agreements, the Land and each item of Equipment and the various Improvements, in
each case located on such Land. Notwithstanding any provision to the contrary in
this Participation Agreement or any other Operative Agreement, unless and until
this definition of "Property" is amended to permit more than one Property, there
shall be only one Property and such Property shall be located in Miramar,
Florida, and shall be suitable for use by the Lessee as a corporate headquarters
building and warehouse facility.
"Property Acquisition Cost" shall mean the cost to Lessor to purchase a
Property on a Property Closing Date.
"Property Closing Date" shall mean each date on which the Lessor
purchases a Property, or leases the Land included in a Property pursuant to a
Ground Lease.
"Property Cost" shall mean with respect to a Property the aggregate
amount of the Loan Property Cost plus the Holder Property Cost for such Property
(as such amounts shall be increased equally among all Properties respecting the
Holder Fundings and the Loans extended
Appendix A-32
from time to time to pay for the Transaction Expenses, fees, taxes, expenses and
other disbursements referenced in SECTIONS 9.1(A) AND (B) of the Participation
Agreement and indemnity payments referenced in SECTION 13.5 of the Participation
Agreement).
"Purchase Option" shall have the meaning given to such term in SECTION
20.1 of the Lease.
"Purchase Option Price" shall have the meaning specified in SECTION
20.1 of the Lease.
"Purchasing Lender" shall have the meaning given to such term in
SECTION 9.8(A) of the Credit Agreement.
"Register" shall have the meaning given to such term in SECTION 9.9(A)
of the Credit Agreement.
"Release" shall mean any release, pumping, pouring, emptying,
injecting, escaping, leaching, dumping, seepage, spill, leek, flow, discharge,
disposal or emission of a Hazardous Substance.
"Remedial Action" shall have the meaning given to such term in SECTION
1.01 of the Existing Aviation Sales Credit Agreement.
"Rent" shall mean, collectively, the Basic Rent and the Supplemental
Rent, in each case payable under the Lease.
"Reportable Event" shall have the meaning specified in ERISA.
"Requested Funds" shall mean any funds requested by the Lessee or the
Construction Agent, as applicable, in accordance with SECTION 5 of the
Participation Agreement.
"Requirement of Law" shall mean, as to any Person, the Certificate of
Incorporation and By-laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"Requisition" shall have the meaning specified in SECTION 4.2 of the
Participation Agreement.
"Reserve Requirement" shall mean, at any time, the maximum rate at
which reserves (including, without limitation, any marginal, special,
supplemental, or emergency reserves) are required to be maintained under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) by member banks of the Federal Reserve System
against "Eurocurrency liabilities" (as such term is used in Regulation D).
Without limiting the effect of the foregoing, the Reserve Requirement shall
reflect any other reserves required to be maintained by such member banks with
respect to (i) any category of liabilities which includes
Appendix A-33
deposits by reference to which the Eurodollar Rate is to be determined, or (ii)
any category of extensions of credit or other assets which include Eurodollar
Loans or Eurodollar Holder Fundings. The Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in the Reserve
Requirement.
"Responsible Officer" shall mean the __________, __________ or
__________ of Aviation Sales or with respect to financial matters, the Chief
Financial Officer or ____________, of Aviation Sales except that when used with
respect to the Trust Company or the Owner Trustee, "Responsible Officer" shall
also include the Cashier, any Assistant Cashier, any Trust Officer or Assistant
Trust Officer, the Controller and any Assistant Controller or any other officer
of the Trust Company or the Owner Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of his or her knowledge of and familiarity
with the particular subject.
"Restricted Junior Payment" shall have the meaning given to such term
in SECTION 1.01 of the Existing Aviation Sales Credit Agreement.
"Revolver Borrowers" means, collectively, Aviation Sales Operating
Company, Arocell Structures, Inc., AVS/▇▇▇▇▇ ▇▇▇▇▇ Machine Company, Whitehall
Corporation and Triad International Maintenance Corporation.
"Sale Date" shall have the meaning given to such term in SECTION
22.1(A) of the Lease.
"Sale Notice" shall mean a notice given to Lessor in connection with
the election by Lessee of its Sale Option.
"Sale Option" shall have the meaning given to such term in SECTION 20.1
of the Lease.
"Scheduled Interest Payment Date" shall mean (a) as to any Eurodollar
Loan (or Eurodollar Holder Funding), the last day of the Interest Period
applicable to such Eurodollar Loan (or Holder Funding), and if such Interest
Period is for more than three months, at intervals of three months after the
first day of such Interest Period and (b) as to any Base Rate Loan (or Base Rate
Holder Funding), the first day of each calendar quarter, and the date of
conversion of such Loan to a Eurodollar Loan (or conversion of such Holder
Funding to a Eurodollar Holder Funding), and (c) as to any Loan (or Holder
Funding), the Maturity Date.
"SEC" means the Securities and Exchange Commission of the United States
(or any successor).
"Securities" shall have the meaning given to such term in SECTION 1.01
of the Existing Aviation Sales Credit Agreement.
"Securities Act" shall mean the Securities Act of 1933, as amended,
together with the rules and regulations promulgated thereunder.
Appendix A-34
"Security Agreement" shall mean the Security Agreement dated as of the
Initial Closing Date between the Owner Trustee and NationsBank, National
Association, as agent, as such agreement may be amended, supplemented, restated
or otherwise modified from time to time in accordance with the terms thereof.
"Security Documents" shall mean the collective reference to the Lease,
the Lease Supplements, the Security Agreement, the Mortgage Instruments, and all
other security documents hereafter delivered to the Administrative Agent
granting a lien on any asset or assets of any Person to secure the obligations
and liabilities of the Borrower hereunder or under any of the other Credit
Documents or to secure any guarantee of any such obligations and liabilities.
"Senior Debt" shall mean collectively, the sum of, without duplication,
(a) "Senior Debt" as defined in the Subordinated Debt Indenture, and (b) the
Synthetic Lease Indebtedness. Nothing contained in this definition shall be
deemed to imply that any obligations under the Operative Agreements do not
constitute "Senior Debt" as defined in the Subordinated Debt Indenture.
"Series A Loans" shall mean the loans described as such in SECTION 2.1
of the Credit Agreement.
"Series A Notes" shall mean the promissory notes issued to the Lenders
pursuant to SECTION 2.2 of the Credit Agreement evidencing the Series A Loans.
"Series B Loans" shall mean the loans described as such in SECTION 2.1
of the Credit Agreement.
"Series B Notes" shall mean the promissory notes issued to the Lenders
pursuant to SECTION 2.2 of the Credit Agreement evidencing the Series B Loans.
"Side Letter" shall mean the Side Letter Agreement dated as of the
Initial Closing Date by the Lessee and the Construction Agent in favor of the
Agent, the Lenders, the Holders and the Owner Trustee.
"Subordinated Debt" shall mean 8 1/8% Senior Subordinated Notes, due
2008, as described more fully in the Subordinated Debt Prospectus (as amended or
modified from time to time) or the Subordinated Debt Indenture (as amended or
modified from time to time).
"Subordinated Debt Indenture" means that certain Indenture dated as of
February 17, 1998, among Aviation Sales, Aviation Sales Operating Company,
Aviation Sales Bearing Company, Aviation Sales Leasing Company, Aviation Sales
Finance Company, Aviation Sales Manufacturing & Repair Company, AVS/▇▇▇▇▇ Wilde
Machine Company, Aerocell Structures, Inc., Apex Manufacturing, Inc., and
SunTrust Bank, Central Florida, National Association, as trustee, without regard
to any amendments to such Indenture after the date thereof.
Appendix A-35
"Subordinated Debt Prospectus" means that certain Offering Memorandum
dated February 11, 1998, describing the Senior Debt, without regard to any
amendments to such Offering Memorandum after the date thereof. A copy of the
Subordinated Debt Prospectus is maintained by the Agent.
"Subsidiary" shall mean, as to any Person, any corporation or other
entity in which more than 50% of its outstanding voting stock or more than 50%
of all equity interests is owned directly or indirectly by such Person and/or by
one or more of such Persons's Subsidiaries.
"Supplemental Rent" shall mean all amounts, liabilities and obligations
(other than Basic Rent) which the Lessee assumes or agrees to pay to Lessor, the
Holders, the Agent, the Lenders or any other Person under the Lease or under any
of the other Operative Agreements including, without limitation, payments of the
Purchase Option Price, the Termination Value, the Deficiency Balance and the
Maximum Residual Guarantee Amount and all indemnification amounts, liabilities
and obligations.
"Synthetic Lease Agreements" means, collectively, (i) the Operative
Agreements, (ii) any other synthetic leases, and (iii) any other operative
documents in connection with any synthetic lease.
"Synthetic Lease Basic Rent" means, with respect to any Person that is
a lessee under any Synthetic Lease Agreements, (i) in the case of the Operative
Agreements, the Basic Rent, and (ii) in the case of any other Synthetic Lease
Agreements, the rent paid by such Person under such Agreement to the extent such
rent is intended to repay, or the amount of such rent is determined by reference
to, any interest on Indebtedness, or yield on equity, owed by the lessor under
such Synthetic Lease Agreements.
"Synthetic Lease Indebtedness" means, with respect to any Person that
is a lessee under any Synthetic Lease Agreements, (i) in the case of the
Operative Agreements, the aggregate Property Cost and (ii) in the case of any
other Synthetic Lease Agreements, the aggregate purchase price of any property
that the lessor under such Synthetic Lease Agreements acquired, through one or a
series of related transactions, and thereafter leased to such Person pursuant to
such Synthetic Lease Agreements. "Synthetic Lease Indebtedness" of Person shall
also include any guaranty by that Person of the Synthetic Lease Indebtedness of
any other Person.
"Tangible Personal Property" shall mean that portion of the Equipment
which is subject to the 5% limitation referred to in SECTION 10.3(E) of the
Participation Agreement.
"Taxes" shall have the meaning specified in the definition of
Impositions.
"Term" shall mean the Basic Term.
"Termination Date" shall have the meaning specified in SECTION 16.2(A)
of the Lease.
"Termination Notice" shall have the meaning specified in SECTION 16.1
of the Lease.
Appendix A-36
"Termination Value" shall mean, as of any date of determination, the
sum of (a) either (i) with respect to all Properties, an amount equal to the
aggregate outstanding Property Cost for all the Properties, or (ii) with respect
to a particular Property, an amount equal to the outstanding Property Cost
allocable to the particular Property in question, plus (b) respecting the
amounts described in each of the foregoing subclause (i) or (ii), as applicable,
any and all accrued interest on the Loans and any and all Holder Yield on the
Holder Advances related to the applicable Property Cost, plus (c) to the extent
not otherwise paid on such date of determination, all other Rent and other
amounts then due and payable for all Properties under the Agency Agreement, the
Lease or any other Operative Agreement (including without limitation all amounts
due and payable under SECTIONS 13.1 or 13.2 of the Participation Agreement and
all costs and expenses referred to in clause FIRST of SECTION 22.2 of the
Lease).
"Total Commitment" shall mean (a) with respect to the Series A Loans,
$31,252,056, and (b) with respect to the Series B Loans, $3,196,233.
"Total Condemnation" shall mean a Condemnation that involves a taking
of Lessor's entire title to a Property.
"Total Holder Commitment" shall mean $1,065,411.
"Transaction Expenses" shall mean all costs and expenses incurred in
connection with the preparation, execution and delivery of the Operative
Agreements and the transactions contemplated by the Operative Agreements
including without limitation:
(a) the reasonable fees, out-of-pocket expenses and
disbursements of counsel in negotiating the terms of the Operative
Agreements and the other transaction documents, preparing for the
closings under, and rendering opinions in connection with, such
transactions and in rendering other services customary for counsel
representing parties to transactions of the types involved in the
transactions contemplated by the Operative Agreements;
(b) any and all reasonable fees, charges or other amounts
payable to the Lenders, Agent, the Holders, the Owner Trustee or any
broker which arise under any of the Operative Agreements;
(c) any other reasonable fee, out-of-pocket expenses,
disbursement or cost of any party to the Operative Agreements or any of
the other transaction documents;
(d) any and all Taxes and fees incurred in recording or filing
any Operative Agreement or any other transaction document, any deed,
declaration, mortgage, security agreement, notice or financing
statement with any public office, registry or governmental agency in
connection with the transactions contemplated by the Operative
Agreement; and
(e) real estate taxes on a Property paid during the
Construction Period.
Appendix A-37
"Trust Agreement" shall mean the Trust Agreement dated as of the
Initial Closing Date between the Holders and the Owner Trustee, as such
agreement may be amended, modified, restated or supplemented from time to time
in accordance with the terms thereof.
"Trust Company" shall mean First Security Bank, National Association in
its individual capacity, and any successor owner trustee under the Trust
Agreement, in each case in its individual capacity.
"Trust Estate" shall have the meaning specified in SECTION 2.2 of the
Trust Agreement.
"Type" shall mean, as to any Loan, whether it is a Base Rate Loan or a
Eurodollar Loan.
"UCC Financing Statements" shall mean collectively the Lender Financing
Statements and the Lessor Financing Statements.
"Unfunded Amount" shall have the meaning specified in SECTION 3.2 of
the Agency Agreement.
"Uniform Commercial Code" and "UCC" shall mean the Uniform Commercial
Code as in effect in any applicable jurisdiction.
"United States Bankruptcy Code" shall mean Title 11 of the United
States Code.
"Unused Fee" shall mean, at any time, the product of (a) the Applicable
Unused Fee Rate, MULTIPLIED BY (b) the average daily amount by which (i) the
aggregate Commitments of the Lenders for all Categories of Loans (under the
Operative Agreements) exceeds (ii) the outstanding principal amount of all
Categories of Loans.
"Unused Fee Payment Date" shall mean last Business Day of each March,
June, September and December and the last day of the Commitment Period, or such
earlier date as the Commitments shall terminate as provided in the Credit
Agreement.
"U.S." shall mean the United States of America, its territories, its
possessions and all other areas subject to its jurisdiction.
"Voting Stock" shall mean, with respect to any Person, capital stock
issued by a corporation or equivalent interests in any other Person, the holders
of which are ordinarily, in the absence of contingencies, entitled to vote for
the election of directors (or persons performing similar functions) of such
Person, even though the right to vote may have been suspended by the happening
of such a contingency.
"Work" shall mean the furnishing of labor, materials, components,
furniture, furnishings, fixtures, appliances, machinery, equipment, tools,
power, water, fuel, lubricants, supplies, goods or services with respect to any
Property.
Appendix A-38