Exhibit 10.69
LAND LEASE AGREEMENT
by and between
Neste Oy,
a Finnish Company having its head office at
Keilaniemi, SF-02150 Espoo, Finland
(hereinafter referred to as "Neste"),
and
Styrochem Finland Oy,
a Finnish Company having an office at
Kilpilahti, FIN-06100 Porvoo, Finland
(hereinafter referred to as the "Lessee"),
and
Radnor Holdings Corporation,
a Delaware Corporation having an office at
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▇.▇.▇.
as Guarantor under Article 15 hereof
Dated as of 15 October, 1997.
WITNESSETH
WHEREAS Neste and the Lessee, among others, have entered into a Sale of
Assets Agreement dated as of September 17, 1997 (hereinafter referred to
as the "Main Agreement"). This Agreement is subject to the Main
Agreement whereby Neste agreed, among other things, to transfer Neste's
polystyrene ("Polystyrene") plant in Kulloo, Porvoo (hereinafter
referred to as the "Plant");
WHEREAS, Neste is the owner of the land on which the Plant is located
(the "Real Property");
WHEREAS, Neste wishes to lease to the Lessee the Real Property for the
manufacture of Polystyrene and the running of the associated business
and the Lessee wishes to occupy the Real Property;
NOW, THEREFORE, both parties hereby agree as follows:
DEFINITIONS:
The following capitalized words and phrases shall have the meanings
described below:
"Affiliate": means in relation to any Party:
a) any person which owns and controls more than fifty per
cent (50%) of the capital stock and voting rights of
such Party;
b) any person more than fifty per cent (50%) of the capital
stock and voting rights of which are owned and
controlled by such Party; or any
c) person more than fifty per cent (50%) of the capital
stock and voting rights of which are owned and
controlled by one or more persons qualifying as
Affiliates under a) or b) above.
"Agreement" means this Agreement and the Appendices attached hereto
which form an integral part hereof.
1. LEASED PROPERTY
Neste hereby agrees to lease out and the Lessee hereby agrees to accept
the lease of the Real Property being the parcel of approximately (77130
+ 6860) 83.990 square metres in Porvoo as described in the map appended
hereto as Appendix 1 and forming part of the registered units numbers
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1:62, 4:109, 4:81 and 4:82. The Lessee has the option (the "Option") to
extend the said Real Property by a parcel of approximately 46680 square
metres (the "Opted Real Property"), as described on the said map,
subject to conditions hereinunder. After the Lessee has exercised such
Option the term "Real Property" shall incorporate both the original Real
Property and the Opted Real Property, and all rights and obligations
provided for in this Agreement shall apply to this Real Property.
2. PURPOSES OF THE LEASE
The Real Property leased under Article 1 hereof, will be used by the
Lessee for the sole purpose of operating the Plant to manufacture
Polysytrene and related products and/or products which use or
incorporate such Polystyrene and/or related products and managing and
running the associated business.
3. LESSEE'S RIGHTS TO POSSESSION OF LAND
3.1 Without prejudice to the obligations and rights of the parties pursuant
to the Neste Service Agreement dated as of the date hereof (hereinafter
referred to the "Neste Service Agreement"), and subject to the Main
Agreement, Neste hereby represents and warrants that the Lessee has the
full rights to
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possession and use of the Real Property throughout the term of this
agreement as it may deem proper for the fulfillment of the purposes of
the lease specified in Article 2 above, including without limitation the
right to improve the Real Property, install machinery, equipment or
tooling, construct any building or structure, including the right of the
Lessee to design, control construction and recruit engineers, architects
or any other person relating to the said construction without having to
obtain Neste's authorization or consent unless mandatory safety or
environmental regulations require it (in which case Neste's consent will
not be unreasonably withheld).
3.2 In the case where it is necessary to make contact with any government
agency to obtain any government approval or license for construction of
the Plant or license for operating the business or manufacturing
Polystyrene, the Lessee shall be responsible therefor in its own name
and with its own expense. However, in a case where Neste's consent is
required for the acquisition of the said licenses or government
approval, Neste agrees to cooperate with and facilitate the Lessee in
all respects, including granting such consent without limitation, where
required.
4. LEASE PERIOD
4.1 The period of the lease shall be thirty (30) years from the date of
Closing (as defined in the Main Agreement).
4.2 Neste covenants that upon the expiration of the lease under Article 4.1,
if the Lessee wishes to renew the lease, Neste will renew this Agreement
for an additional period requested by Lessee (provided such additional
period shall not exceed sixty-nine (69) years) upon the same terms and
conditions hereof, with the exception of the amount of the rent to be
paid under this Agreement which shall then be renegotiated (but in no
event shall exceed fair market price) and with such modifications as may
be required to comply with applicable laws. In order to renew such rent
period, (i) the Lessee shall give to Neste prior notice not less than
twelve (12) months before the expiration date of the lease period under
Article 4.1 and (ii) the Lessee must not be in material breach of any of
the provisions of this Agreement.
4.3 The Option shall be valid as of the date hereof until the lease period,
whether original or renewed, has expired.
4.4 The Parties agree that at the expiration of the initial term of this
Agreement the Parties shall also discuss in good faith the alternative
of Lessee purchasing the Real Property outright for a purchase price to
be negotiated but in no event to exceed the fair market value of the
Real Property.
5. RENT AND RENTAL PAYMENT
5.1 The rent shall be one (1) Finnish Markka per annum, payable to Neste
each year on or before the 5th of November. Lessee will reimburse any
real estate taxes borne by Neste as a result of ownership of the Real
Property, such reimbursement to be made on an annual basis within thirty
(30) days after
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receipt by Lessee of a notice from Neste specifying the amount to be
reimbursed.
5.2 The rent for the Opted Real Property shall be agreed separately, on the
basis of the fair market value of such real property.
6. DELIVERY OF REAL PROPERTY
Neste shall deliver the Real Property under Article 1 hereof to the
Lessee, in good condition to enable the Lessee to conduct the operations
referred to in Article 2, and subject to the terms of the Main Agreement
without any liens or charges or mortgages or encumbrances on or against
the title of the same throughout the term of this lease, including any
agreement which might prejudice or impair the rights of the Lessee to
use or enjoy the full benefit of such Real Property.
7. NESTE'S COVENANTS
Neste covenants with the Lessee that the Lessee is entitled to take out
a mortgage on the Real Property (pysyvyyskiinnitys vuokraoikeuden
vakuudeksi) in surety of this Agreement and the rights of the Lessee
under and in connection with this Agreement without hearing Neste.
8. LESSEE'S COVENANTS
The Lessee covenants with Neste as follows:
8.1 that the Lessee shall punctually pay the rent in full as may fall due
throughout the period of this Agreement;
8.2 that the Lessee shall not keep illegal material or merchandise on the
Real Property;
8.3 that the Lessee shall strictly comply with the laws, rules, orders and
regulations of the government, state and local authorities as well as
reasonable general safety rules established from time to time by Neste
affecting the general operations and facilities in Neste's Porvoo works.
Neste shall keep the Lessee informed of the said rules prior to the
rules taking effect;
8.4 that the Lessee must keep the Real Property in good condition according
to what is customary in the field of industry of the Lessee at its own
expense throughout the term of this Agreement and shall not commit any
waste upon the Real Property and shall keep the Real Property and the
property thereon in accordance with applicable local regulations
concerning building, zoning, fire, health and other ordinances and
Neste's reasonable general rules regarding such matters provided Lessee
is informed of all such rules prior to such rules taking effect;
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8.5 that the Lessee shall not sublease the Real Property, either wholly or
partially, to a third person. The Lessee shall have the right to
sublease any building situated on the Real Property, provided that the
Lessor shall have given its prior written consent for such sublease,
which consent shall not be unreasonably withheld;
8.6 that the Lessee shall not suffer the Real Property or any erection or
improvement on the Plant to become subject to any lien, charge or
encumbrance whatsoever, other than a mortgage as set out in Article 7.
For the avoidance of doubt, nothing in this Agreement shall prevent the
Lessee from granting a business mortgage (yrityskiinnitys) in respect of
movable assets of the Lessee located on the Real Property, nor granting
other security interest in respect of movable property to secure any
financing obtained by the Lessee;
8.7 that Lessee shall immediately upon termination of this Agreement release
the Real Property from any mortgage or other security interest it has
taken out on the Real Property.
9. TAXES AND FEES
The lessor shall be responsible for all real estate taxes related to the
ownership of the Real Property which shall be reimbursed to the Lessor
in accordance with Article 5.
10. USE OF ROADS AND TERMINAL
Neste shall permit the Lessee reasonable rights to use the roads that
give access to the Real Property and to use the nearest available
railway terminal.
11. NESTE'S RIGHT TO TERMINATE THE AGREEMENT
Neste shall have the right to terminate this Agreement upon the
occurrence of any of the following events during the period of the lease
under this Agreement:
11.1 The Lessee does not pay the rent required to be paid under the
provisions of this Agreement and such non-payment is occurring more than
thirty (30) days from the date Neste sends written notice to the Lessee
reminding the Lessee of such non-payment and threatening to terminate
this Agreement if such non-payment continues;
11.2 The Lessee neglects, omits to perform, does not observe or comply with
any provision of this Agreement, provided that, so long as such failure
or omission of the Lessee is continuing, Neste shall first give a
written notice informing such cause to the Lessee and the Lessee does
not rectify or remedy the cause thereof within thirty (30) days from the
date of the receiving of such notice. However, if the Lessee commences
the rectification or remedy within the said thirty (30) days and has
completed the rectification
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or remedy of such cause within Neste's reasonably specified time in such
notice which in no event shall be less than ninety (90) days thereafter,
it shall not be deemed a breach of this Agreement on the part of the
Lessee. Neste shall have no right to give the notice nor terminate this
Agreement after a date three (3) months from the date Neste became aware
of such failure or omission;
11.3 The Lessee becomes bankrupt by judgement of the court or the whole
facilities situated on the Real Property or the rights under this
Agreement have been seized or attached by judgement or court order,
provided however that Neste may not so terminate this Agreement if the
Lessee provides adequate security in respect of the obligations of the
Lessee under this Agreement;
11.4 The Lessee ceases the commercial manufacture of Polystyrene or related
products or products using or incorporating polystyrene or any such
related product in the Plant.
12. LESSEE'S RIGHT TO TERMINATE THE AGREEMENT
The Lessee shall have the right to terminate this Agreement upon the
occurrence of any of the following events during the period of the lease
under this Agreement:
12.1 Neste neglects, omits to perform, does not observe or comply with any
provision of this Agreement, provided that the Lessee shall first give a
written notice informing such cause to Neste and Neste does not rectify
or remedy the cause thereof within thirty (30) days from the date of
receipt of such notice. However, if Neste commences the rectification or
remedy within the said thirty (30) days and has completed the
rectification or remedy of such cause within the Lessee's specified time
in such notice which in no event shall be less than ninety (90) days
thereafter, it shall not be deemed a breach of this Agreement on the
part of Neste.
However, if the Lessee chooses not to exercise its right to terminate
this Agreement under the preceding paragraph, it may rectify or remedy
such cause or may authorize a third person to do so. In this instance,
Neste shall be responsible for and promptly pay, at the Lessee's
request, all expenses incurred by the Lessee in connection therewith.
12.2 The Real Property and/or any structure thereon, either wholly or
partially, is, for reasons not attributable to the Lessee, expropriated,
seized, attached or under possession whatsoever by law, notification or
order of the government, judgement or court order.
12.3 The Real Property and/or any structure thereon is in a totally
unsuitable condition for the purposes of the lease which is caused by
fire, flood, war, riot, calamity, force majeure or any event or act,
except those resulting from the negligence or willful act of the Lessee
or resulting from the Lessee's breach of the provisions of this
Agreement.
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13. RIGHTS OF NESTE UPON TERMINATION OF THIS AGREEMENT
Upon any termination of this Agreement, Neste shall have an option to
repossess the buildings and other assets and general purpose equipment
in the Plant at a price to be agreed between the parties. If such
agreement is not reached between the parties within 30 days from any
termination of this Agreement, the Lessee is obligated at his cost to
remove any and all buildings together with any and all machines,
equipment or tooling used therefor, in or on the Real Property (other
than such buildings, machines and equipment located on the leased
property as of the date hereof) not later than 120 days from the said 30
day period so that the Real Property is left to Neste in a condition
free from such properties (other than such buildings, machines or
tooling located on the leased property as of the date hereof). Subject
to any rights that Lessee may have against Neste under the Main
Agreement, the Lessee shall leave the leased property to Neste free from
waste, toxic materials and other environmental liabilities attributable
to the lease period, including the original and renewed lease period (if
any).
14. GENERAL TERMS AND CONDITIONS
14.1 Should any provision of this Agreement be held invalid or unenforceable
under any applicable law, the other provisions of this Agreement shall
be binding on the parties as if such provision were not included therein
and the parties, according to their intent at the date of signature of
this Agreement, shall mutually agree upon modifications of such
provision to the extent necessary to render it lawful and enforceable.
14.2 This Agreement is executed in two originals by the parties hereto. In
the event that this Agreement is translated into Finnish or any other
language, and any inconsistency of interpretations results therefrom,
the Agreement in English shall take precedent and be controlling between
the parties hereto.
14.3 This Agreement sets forth the entire agreement and understanding between
the parties and supersedes any and all prior negotiations, discussions
and agreements between the parties with regards to the subject matter
contained herein.
14.4 Neither Party shall be permitted to assign this Agreement without the
prior written consent of the other Party, which shall not be
unreasonably withheld. This Agreement shall inure to the benefit of, and
be binding upon the parties hereto and their respective successors and
permitted assigns.
Notwithstanding the preceding provisions of this Article 14.4, either
Party may assign the benefit and burden of this Agreement to an
Affiliate of such Party; provided that
a) such Affiliate agrees in writing to assume the obligations of the
assigning Party hereunder; and
b) in the case of an assignment to an Affiliate of StyroChem Finland
Oy, the guarantee in Article 15 continues to apply; and
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c) in the case of an assignment to an Affiliate of Neste Oy, Neste
Oy shall remain liable with the assignee Affiliate.
14.5 This Agreement shall become effective on the Closing Date as defined in
the Main Agreement.
14.6 This Agreement shall be governed and construed in accordance with the
Land Lease law and other laws of Finland.
The Parties hereto shall endeavour to solve amicably any dispute arising
under this Agreement.
Any disputes arising under this Agreement, which cannot be solved by
amicable means, shall be submitted to arbitration according to the rules
of Arbitration of the Finnish Central Chamber of Commerce.
Notwithstanding the above, the arbitrators shall be nominated as
follows: Each party shall nominate one arbitrator within fifteen (15)
days from the date notice was first given by the other party of that
party's intention to have the matter submitted to arbitration, together
with that party's nomination of an arbitrator. The arbitrators so
nominated shall agree upon a third arbitrator as chairman of the
arbitral tribunal within fifteen (15) days of the nomination of the
second arbitrator. Failing nomination of an arbitrator by one of the
parties, or agreement on the chairman by the two arbitrators within the
time specified, the Finnish Central Chamber of Commerce shall, in
accordance with the rules of arbitration of the Finnish Central Chamber
of Commerce appoint the arbitrator and/or the chairman.
The arbitral award rendered in accordance with Finnish law shall be
final and enforceable.
The arbitrators shall conduct the matter at their own discretion. The
arbitrators shall, unless the parties otherwise agree, convene in
Helsinki, Finland. The proceedings shall be conducted in the English
language.
14.7 In the event Neste attempts to sell all or a portion of the Real
Property during the term of this Agreement as a separate parcel of
property from the remainder of the Porvoo Site then lessee shall have a
right of first refusal to purchase such portion of the Real Property on
the same terms and conditions being offered by the potential purchasers.
14.8 All notices required or permitted to be given hereunder shall be in
writing in English and will be valid and sufficient if dispatched by
courier, telefax, registered mail, postage prepaid to the addresses
written below:
If to NESTE OY:
NESTE OY
Keilaniemi
SF-02150 ESPOO
FINLAND
Telefax: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
Attention: Kyosti Sysio, Senior Vice President
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If to STYROCHEM:
RADNOR HOLDINGS CORPORATION
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Telefax: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
or to such address as either party shall have specified by a notice in
writing given to the other party in the manner set forth above. Notices
given as herein provided shall be deemed to be effective upon receipt.
15. PARENT COMPANY GUARANTEE
Radnor Holdings Corporation hereby irrevocably guarantees any obligation
of the Lessee and its successors permitted assignees and permitted
transferees, set forth in this Agreement and undertakes to fulfill them
as its own obligations.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives or officers as of the
year and date first above written.
NESTE OY STYROCHEM FINLAND OY
By: /s/ KYOSTI SYSIO By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: KYOSTI SYSIO Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: SR. VP Title: SR. VP
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RADNOR HOLDINGS CORPORATION
as Guarantor under Article 15 hereof
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: SR. VP
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