Exhibit 10.2.2
--------------------------------------------------------------------------------
PARTICIPATION AGREEMENT
Dated as of December 5, 2000
among
CAPITAL ONE, F.S.B. AND CAPITAL ONE BANK, jointly and severally as the
Construction Agent and as the Lessee,
CAPITAL ONE FINANCIAL CORPORATION,
as the Guarantor,
FIRST UNION DEVELOPMENT CORPORATION,
as the Borrower and as the Lessor,
THE VARIOUS FINANCIAL INSTITUTIONS AND OTHER INSTITUTIONAL INVESTORS
WHICH ARE PARTIES HERETO FROM TIME TO TIME, as the Tranche A Note Purchasers,
THE VARIOUS BANKS AND OTHER LENDING INSTITUTIONS WHICH ARE PARTIES
HERETO FROM TIME TO TIME, as the Tranche B Lenders,
and
FIRST UNION NATIONAL BANK,
as the Agent for the Primary Financing Parties
and, respecting the Security Documents,
as the Agent for the Secured Parties
and
FIRST UNION NATIONAL BANK,
as the Escrow Agent
--------------------------------------------------------------------------------
TABLE OF CONTENTS
Page
SECTION 1. THE FINANCING.................................................................................... 1
SECTION 2. [RESERVED]....................................................................................... 2
SECTION 3. SUMMARY OF TRANSACTIONS.......................................................................... 2
3.1. Operative Agreements............................................................................. 2
3.2. Property Purchase................................................................................ 2
3.3. Construction of Improvements; Commencement of Basic Rent......................................... 2
SECTION 4. THE CLOSING...................................................................................... 2
4.1. Closing Date..................................................................................... 2
4.2. Closing Date; Acquisition Advance; Construction Advances......................................... 3
SECTION 5. FUNDING OF ADVANCES; CONDITIONS PRECEDENT; REPORTING REQUIREMENTS ON COMPLETION DATE; THE
LESSEE'S DELIVERY OF NOTICES; RESTRICTIONS ON LIENS.............................................. 3
5.1. General.......................................................................................... 3
5.2. Procedures for Funding........................................................................... 3
5.3. Conditions Precedent for the Lessee, the Lessor, the Agent and the Primary Financing
Parties Relating to the Closing Date and the Advance of Funds for the Acquisition of the
Property......................................................................................... 5
5.4. Conditions Precedent for the Lessor, the Agent and the Tranche B Lenders Relating to the
Advance of Funds after the Acquisition Advance................................................... 10
5.5. Additional Reporting and Delivery Requirements on Completion Date................................ 11
5.6. The Construction Agent Delivery of Construction Budget Modifications............................. 12
5.7. Restrictions on Liens............................................................................ 12
5.8. [Reserved]....................................................................................... 13
5.9. [Reserved]....................................................................................... 13
5.10. Payments......................................................................................... 13
5.11. Extension of Construction Period Termination Date................................................ 13
5.12 Escrow Account................................................................................... 14
5.13. Partial Funding of Unreimbursed Costs Following an Agency Agreement Event of Default............. 15
5.14. Lessee's Right to Replace Non-Consenting Primary Financing Parties............................... 15
5.15 Rights of Tranche A Note Purchasers Upon Merger and Change of Director Control of COB, FSB
or COFC or Upon Downgrade of Debt Rating of COB.................................................. 16
SECTION 6. REPRESENTATIONS AND WARRANTIES................................................................... 17
6.1. Representations and Warranties of the Borrower................................................... 17
6.2. Representations and Warranties of the Lessee..................................................... 19
6.3 Additional Representations and Warranties of FSB................................................. 24
6.3.1 Organization; Power and Authority..................................................... 24
6.3.2 Authorization, etc.................................................................... 24
6.3.3 [Reserved]............................................................................ 24
6.3.4 Financial Statements.................................................................. 24
6.3.5 Compliance with Laws, Other Instruments, etc.......................................... 25
i
6.3.6 [Reserved]............................................................................ 25
6.3.7 [Reserved]............................................................................ 25
6.3.8 [Reserved]............................................................................ 25
6.3.9 Compliance with ERISA................................................................. 25
6.3.10 Offering of the Tranche A Notes, etc.................................................. 26
6.3.11 Status under Certain Statutes......................................................... 26
6.3.12 Legal Name; Trade Names............................................................... 26
6.4 Additional Representations, Warranties and Covenants of COB...................................... 26
6.4.1 Organization; Power and Authority..................................................... 26
6.4.2 Authorization, etc.................................................................... 27
6.4.3 [Reserved]............................................................................ 27
6.4.4 Financial Statements.................................................................. 27
6.4.5 Compliance with Laws, Other Instruments, etc.......................................... 28
6.4.6 [Reserved]............................................................................ 28
6.4.7 [Reserved]............................................................................ 28
6.4.8 [Reserved]............................................................................ 28
6.4.9 Compliance with ERISA................................................................. 28
6.4.10 Offering of the Tranche A Notes, etc.................................................. 28
6.4.11 Status under Certain Statutes......................................................... 29
6.4.12 Legal Name; Trade Names............................................................... 29
SECTION 7. PAYMENT OF CERTAIN EXPENSES...................................................................... 29
7.1. Transaction Expenses............................................................................. 29
7.2. Brokers' Fees.................................................................................... 31
7.3. Certain Fees and Expenses........................................................................ 31
7.4. [Reserved]....................................................................................... 31
7.5. Administrative Fee............................................................................... 31
SECTION 8. OTHER COVENANTS AND AGREEMENTS................................................................... 32
8.1. Cooperation with the Construction Agent or the Lessee............................................ 32
8.2. Covenants of the Lessor.......................................................................... 32
8.3. Credit Party Covenants, Consent and Acknowledgment............................................... 33
8.3A Additional Affirmative Covenants of FSB.......................................................... 39
8.3A.1 Financial and Business Information.................................................... 39
8.3A.2 Inspection............................................................................ 42
8.3A.3 Compliance with Law................................................................... 42
8.3A.4 Insurance............................................................................. 43
8.3A.5 Maintenance of Properties............................................................. 43
8.3A.6 Payment of Taxes and Claims........................................................... 43
8.3A.7 Corporate Existence, etc.............................................................. 43
8.3A.8 Litigation............................................................................ 43
8.3B Additional Negative Covenants of FSB............................................................. 44
8.3B.1 Delinquency Ratio..................................................................... 44
8.3B.2 Other Financial Conditions............................................................ 44
8.3B.3 Merger, Consolidation, etc............................................................ 44
8.3B.4 Lines of Business..................................................................... 45
8.3C Additional Affirmative Covenants of COB.......................................................... 45
8.3C.1 Financial and Business Information.................................................... 45
ii
8.3C.2 Inspection............................................................................ 48
8.3C.3 Compliance with Law................................................................... 48
8.3C.4 Insurance............................................................................. 49
8.3C.5 Maintenance of Properties............................................................. 49
8.3C.6 Payment of Taxes and Claims........................................................... 49
8.3C.7 Corporate Existence, etc.............................................................. 49
8.3C.8 Litigation............................................................................ 49
8.3D Additional Negative Covenants of COB............................................................. 50
8.3D.1 Delinquency Ratio..................................................................... 50
8.3D.2 Other Financial Conditions............................................................ 50
8.3D.3 Merger, Consolidation, etc............................................................ 50
8.3D.4 Lines of Business..................................................................... 51
8.4. Sharing of Certain Payments...................................................................... 51
8.5. Grant of Easements, etc.......................................................................... 51
8.6. Appointment of the Agent by the Primary Financing Parties and the Lessor......................... 52
8.7. Collection and Allocation of Payments and Other Amounts.......................................... 56
8.8. Release of Properties, etc....................................................................... 59
8.9. Limitation of Lessor's Obligations............................................................... 60
8.10. No Representations or Warranties as to the Property or Operative Agreements...................... 61
8.11. Reliance; Advice of Counsel...................................................................... 61
8.12. Recordation of the Lease Supplement and/or Memorandum of Lease................................... 62
8.13 Amendments to Guarantor Credit Agreement......................................................... 62
8.14 Joint and Several Liability of the Lessees and Construction Agents............................... 63
8.15 Appointment of COB as Agent for FSB.............................................................. 65
SECTION 9. CREDIT AGREEMENT................................................................................. 65
9.1. The Construction Agent's and the Lessee's Credit Agreement and Note Purchase Agreement
Rights........................................................................................... 65
SECTION 10. TRANSFER OF INTEREST............................................................................. 66
10.1. Restrictions on Transfer......................................................................... 66
10.2. Effect of Transfer............................................................................... 67
SECTION 11. INDEMNIFICATION.................................................................................. 68
11.1. General Indemnity................................................................................ 68
11.2. General Tax Indemnity............................................................................ 71
11.3. Increased Costs, Illegality, etc................................................................. 76
11.4. Funding/Contribution Indemnity................................................................... 77
11.5. EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE, STRICT LIABILITY, ETC........................... 78
11.6. Additional Provisions Regarding Environmental Indemnification.................................... 78
11.7. Indemnity Prior to Completion Date............................................................... 79
SECTION 12. MISCELLANEOUS.................................................................................... 79
12.1. Survival of Agreements........................................................................... 79
12.2. Notices.......................................................................................... 80
12.3. Counterparts..................................................................................... 81
12.4. Terminations, Amendments, Waivers, Etc.; Unanimous Vote Matters.................................. 81
12.5. Headings, etc.................................................................................... 82
iii
12.6. Parties in Interest.............................................................................. 82
12.7. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; VENUE........................... 82
12.8. Severability..................................................................................... 83
12.9. Liability Limited................................................................................ 83
12.10. Rights of the Credit Parties..................................................................... 84
12.11. Further Assurances............................................................................... 84
12.12. Calculations under Operative Agreements.......................................................... 85
12.13. Confidentiality.................................................................................. 85
12.14. Financial Reporting/Tax Characterization......................................................... 86
12.15. Set-off.......................................................................................... 87
12.16. Lease Senior..................................................................................... 87
EXHIBITS
A - Form of Requisition - Sections 4.2, 5.2, 5.3 and 5.4
B - [Reserved]
C - Form of Secretary's Certificate - Section 5.3(z)
D - Form of Officer's Certificate - Section 5.3(aa)
E - Form of Secretary's Certificate - Section 5.3(cc)
F - Form of Officer's Certificate - Section 5.3(dd)
G - [Reserved]
H - [Reserved]
I - Form of Officer's Certificate - Section 5.5
J - [Reserved]
K - Description of Material Litigation - Section 6.2(d)
L - State of Incorporation/Formation and Principal Place of Business of The
Guarantor - Section 6.3(i)
Appendix A - Rules of Usage and Definitions
iv
PARTICIPATION AGREEMENT
THIS PARTICIPATION AGREEMENT dated as of December 5, 2000 (as amended,
modified, extended, supplemented and/or restated from time to time, this
"Agreement") is by and among CAPITAL ONE, F.S.B., a federal savings bank
---------
("FSB"), and CAPITAL ONE BANK, a Virginia banking corporation ("COB")
--- ---
(collectively, FSB and COB may be referred to herein as the "Lessee" or the
------
"Construction Agent"); CAPITAL ONE FINANCIAL CORPORATION, a Delaware corporation
------------------
("COFC"), as the guarantor (the "Guarantor"); FIRST UNION DEVELOPMENT
---- ---------
CORPORATION, a North Carolina corporation (the "Borrower" or the "Lessor"); the
-------- ------
various financial institutions and other institutional investors which are
parties hereto from time to time as holders of the Tranche A Notes (subject to
the definition of Tranche A Note Purchasers in Appendix A hereto, individually,
a "Tranche A Note Purchaser" and collectively, the "Tranche A Note Purchasers");
------------------------ -------------------------
the various banks and other lending institutions which are parties hereto from
time to time as Tranche B Lenders (subject to the definition of Tranche B
Lenders in Appendix A hereto, individually, a "Tranche B Lender" and
----------------
collectively, the "Tranche B Lenders") (each Tranche A Note Purchaser and each
-----------------
Tranche B Lender may be referred to individually as a "Primary Financing Party"
-----------------------
and collectively as the "Primary Financing Parties"); FIRST UNION NATIONAL BANK,
-------------------------
a national banking association, as the agent for the Primary Financing Parties
and respecting the Security Documents, as the agent for the Secured Parties (in
such capacity, the "Agent"); and FIRST UNION NATIONAL BANK, a national banking
-----
association, as the Escrow Agent (the "Escrow Agent"). 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, the receipt of which is hereby acknowledged, the
parties hereto hereby agree as follows:
SECTION 1. THE FINANCING.
Subject to the terms and conditions of this Agreement and the other
Operative Agreements and in reliance on the representations and warranties of
each of the parties hereto contained herein or made pursuant hereto, the Primary
Financing Parties have agreed to make Tranche B Loans to the Lessor or purchase
the Tranche A Notes issued by the Lessor from time to time in an aggregate
principal amount of up to the aggregate amount of the Primary Financing Parties'
Commitments in order for the Lessor to ground lease the Land, and to develop and
construct certain Improvements in accordance with the Agency Agreement and the
terms and provisions hereof and for the other purposes described herein. The
Tranche B Loans shall be made pursuant to the Credit Agreement. The Tranche A
Note Purchasers will purchase the Tranche A Notes pursuant to the Note Purchase
Agreement. The Tranche A Proceeds received by the Lessor from the sale of the
Tranche A Notes (the "Tranche A Proceeds") will be deposited in the Escrow
------------------
Account and disbursed to the Lessor pursuant to the terms of the Operative
Agreements. The obligations of the Lessor under the Notes shall be secured by
the Collateral.
SECTION 2. [RESERVED].
SECTION 3. SUMMARY OF TRANSACTIONS.
3.1. Operative Agreements.
--------------------
On the Closing Date, each of the respective parties hereto and thereto
shall execute and deliver this Agreement, the Lease, the Ground Lease, the
Agency Agreement, the Note Purchase Agreement, the Credit Agreement, the Notes,
the Security Agreement, the Guaranty, each applicable Mortgage Instrument and
such other documents, instruments, certificates and opinions of counsel as
agreed to by the parties hereto.
3.2. Property Purchase.
-----------------
On the Closing Date and subject to the terms and conditions of this
Agreement (a) the Agent will disburse a portion of the Tranche A Proceeds from
the Escrow Account in accordance with Section 5 of this Agreement, (b) the
Tranche B Lenders will each make Tranche B Loans in accordance with Section 5 of
this Agreement and the terms and provisions of the Credit Agreement, and (c) the
Lessor will ground lease, pursuant to the Ground Lease, the Property, pay other
Project Costs, as applicable, and grant the Agent a lien on its leasehold
interest in the Property by execution of the required Security Documents.
3.3. Construction of Improvements; Commencement of Basic Rent.
--------------------------------------------------------
Construction Advances will be made with respect to particular
Improvements to be constructed and with respect to ongoing Work regarding the
Equipment and construction of particular Improvements, in each case, pursuant to
the terms and conditions of this Agreement and the Agency Agreement. The
Construction Agent will act as a construction agent on behalf of the Lessor
respecting the Work regarding the Equipment, the construction of such
Improvements and the expenditures of the Construction Advances related to the
foregoing. The Construction Agent shall promptly notify the Lessor upon
Completion of any Improvements and the Lessee shall commence to pay Basic Rent
as of the Rent Commencement Date.
SECTION 4. THE CLOSING.
4.1. Closing Date.
------------
All documents and instruments required to be delivered on the Closing
Date shall be delivered at the offices of ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC, Charlotte,
North Carolina, or at such other location as may be determined by the Lessor,
the Agent and the Lessee.
2
4.2. Closing Date; Acquisition Advance; Construction Advances.
--------------------------------------------------------
The Construction Agent shall deliver to the Agent a requisition (a
"Requisition"), in the form attached hereto as Exhibit A or in such other form
-----------
as is satisfactory to the Agent, in its reasonable discretion, in connection
with (a) the Transaction Expenses and other fees, expenses and disbursements
payable, pursuant to Section 7.1, by the Lessor, (b) the Acquisition Advance
pursuant to Section 5.3 and (c) each Construction Advance pursuant to Section
5.4.
SECTION 5. FUNDING OF ADVANCES; CONDITIONS PRECEDENT; REPORTING
REQUIREMENTS ON COMPLETION DATE; THE LESSEE'S DELIVERY OF
NOTICES; RESTRICTIONS ON LIENS.
5.1. General.
-------
To the extent funds have been advanced to the Lessor pursuant to this
Section 5, 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
for the following purposes (costs expended for the following purposes are herein
referred to as the "Project Costs") (i) at the direction of the Construction
-------------
Agent to ground lease the Land in accordance with the terms of this Agreement,
the Agency Agreement and the other Operative Agreements, (ii) to make Advances
to the Construction Agent to permit the acquisition, testing, engineering,
installation, development, construction, modification, design, and renovation,
as applicable, of the Property (or components thereof) in accordance with the
terms of the Agency Agreement and the other Operative Agreements, (iii) to pay
interest to the Tranche A Note Purchasers pursuant to the Tranche A Notes,
interest to the Tranche B Lenders pursuant to the Tranche B Notes, Transaction
Expenses, and reasonable fees, expenses and other disbursements payable under
Section 7; provided, however, that Tranche A Non-GAAP Interest Expense and any
-------- -------
other Non-GAAP Expenses shall be included as an amount to be paid in connection
with a Requisition and shall be paid on each Scheduled Interest Payment Date, as
applicable, during the period prior to the Rent Commencement Date out of the
proceeds of the Tranche B Loans made on such date, and (iv) Supplemental Rent
constituting Transaction Expenses payable during the Construction Period.
5.2. Procedures for Funding.
----------------------
(a) Except as expressly provided herein, Advances hereunder
shall only be made on the Closing Date and on the first day of each
calendar month, unless such day is not a Business Day, in which case on
the next occurring Business Day after the first day of such month;
provided, on no more than three (3) separate occasions during any
--------
calendar year, the Construction Agent may designate a Business Day
other than the first day of the month as the date for an Advance. Not
less than (i) three (3) Business Days prior to the Closing Date and
(ii) three (3) Business Days prior to the date on which any Acquisition
Advance or Construction Advance is to be made, the Construction Agent
shall deliver to the Agent, with respect to the Closing Date, the
Acquisition Advance and each Construction Advance, a Requisition as
described in Section 4.2 hereof (including
3
without limitation Tranche A Non-GAAP Interest Expense and any other
Non-GAAP Expenses), in a form reasonably acceptable to the Agent.
(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 Tranche B Lender Commitments plus the balance of funds
in the Escrow Account at such time, and (iii) request that the Agent
disburse funds to Lessor out of the Escrow Account and that the Tranche
B Lenders make Tranche B Loans to the Lessor for the payment of
Transaction Expenses, Property Acquisition Costs (in the case of the
Acquisition Advance) or other Project Costs (in the case of a
Construction Advance) that have previously been incurred or are to be
incurred on the date of such Advance to the extent such were not
subject to a prior Requisition, in each case as specified in the
Requisition.
(c) Subject to the satisfaction of the conditions precedent
set forth in Sections 5.3 or 5.4, as applicable, (i) on the Closing
Date, the Tranche A Note Purchasers shall purchase the Tranche A Notes,
the proceeds from which shall be deposited in the Escrow Account, based
on their respective Tranche A Commitments, (ii) on the Closing Date and
the date on which each Construction Advance is to be made, as
applicable, the Tranche B Lenders shall make Tranche B Loans based on
their respective Tranche B Commitments to the Lessor in an aggregate
amount, together with the Tranche A Proceeds disbursed by the Agent
toward any Requisition, equal to the amount of the Requested Funds
specified in any Requisition (up to an aggregate principal amount equal
to the aggregate of the Available Tranche B Lender Commitments), and
(iii) the total amount of Tranche A Proceeds disbursed by the Agent and
Tranche B Loans made by the Tranche B Lenders on such date shall (x) be
used by the Lessor to pay Project Costs including Transaction Expenses
or (y) be advanced by the Lessor on the date of such Advance to the
Construction Agent or the Lessee to pay Project Costs, as applicable.
The Requested Funds shall be funded with Tranche A Proceeds and Tranche
B Loans, (I) with the Agent disbursing an amount equal to the product
of the Requested Funds (less any Non-GAAP Expenses) set forth in such
Requisition times seventy-five percent (75%) out of the Escrow Account
and (II) with the Tranche B Lenders advancing the sum of (A) an amount
equal to the product of the Requested Funds (less any Non-GAAP
Expenses) set forth in such Requisition times twenty-five percent (25%)
plus (B) the total amount of Non-GAAP Expenses requested pursuant to
such Requisition in the form of Tranche B Loans. Notwithstanding that
the Operative Agreements state that Advances shall be directed to the
Lessor, each Advance shall in fact be directed to the Construction
Agent (for the benefit of the Lessor) and applied by the Construction
Agent (for the benefit of the Lessor) pursuant to the requirements
imposed on the Lessor under the Operative Agreements.
(d) [Reserved].
(e) All Operative Agreements which are to be delivered to
the Lessor, the Agent or the Primary Financing Parties shall be
delivered to the Agent, on behalf of the Lessor, the Agent or the
Primary Financing Parties, and such items (except for Notes, Bills of
Sale, the Ground Lease and chattel paper originals, with respect to
which in each
4
case there shall be only one original) shall be delivered with
originals sufficient for the Lessor, the Agent and each Primary
Financing Party. The Agent shall then deliver such Operative Agreements
to the Lessor and each Primary Financing Party. All other items which
are to be delivered to the Lessor, the Agent or the Primary Financing
Parties shall be delivered to the Agent, on behalf of the Lessor, the
Agent or the Primary Financing Parties or directly to such party as
required by the Operative Agreements. Except as otherwise noted, copies
shall be sufficient for any other deliveries to parties other than the
Agent required under Sections 5.3, 5.4 or 5.5. To the extent any such
other items delivered to the Agent are requested in writing from time
to time by the Lessor or any Primary Financing Party or are required to
be delivered by the Agent pursuant to Section 8.6(g), the Agent shall
provide a copy of such item to the party requesting it or to the
parties entitled thereto, as applicable.
(f) The Agent hereby agrees that it will calculate the
amount of Tranche A Non-GAAP Interest Expense during each period
referenced in Section 5.2(a), and will provide prompt written notice of
such amount to the Construction Agent, for inclusion in the Requisition
referenced in Section 5.2(a).
5.3. Conditions Precedent for the Lessee, the Lessor, the Agent and
--------------------------------------------------------------
the Primary Financing Parties Relating to the Closing Date and
--------------------------------------------------------------
the Advance of Funds for the Acquisition of the Property.
--------------------------------------------------------
The obligations (i) on the Closing Date of the Lessee, the Lessor, the
Agent and the Primary Financing Parties to enter into the transactions
contemplated by this Agreement, including without limitation the obligation to
execute and deliver the applicable Operative Agreements to which each is a party
on the Closing Date and, in the case of the Tranche A Note Purchasers, to
purchase the Tranche A Notes (the proceeds from which shall be deposited in the
Escrow Account), (ii) on the Closing Date of the Agent to disburse Tranche A
Proceeds from the Escrow Account to the Lessor and the Tranche B Lenders to make
Tranche B Loans in order to pay Transaction Expenses, fees, expenses and other
disbursements payable by the Lessor under Section 7.1(a) of this Agreement and
(iii) on the Closing Date for the purpose of providing funds to the Lessor
necessary to pay the Transaction Expenses, fees, expenses and other
disbursements payable by the Lessor under Section 7.1(b) of this Agreement and
to ground lease the Property (the "Acquisition Advance"), in each case (with
-------------------
regard to the foregoing Sections 5.3(i), (ii) and (iii)) are subject to the
satisfaction or waiver of the following conditions precedent on or prior to the
Closing Date (to the extent such conditions precedent require the delivery of
any agreement, certificate, instrument, memorandum, legal or other opinion,
appraisal, commitment, title insurance commitment, lien report or any other
document of any kind or type, such shall be in form and substance satisfactory
to the Agent and the Primary Financing Parties, in their reasonable discretion;
notwithstanding the foregoing, the obligations of each party shall not be
subject to any conditions contained in this Section 5.3 which are required to be
performed by such party):
(a) the correctness in all material respects of the
representations and warranties of the parties to this Agreement
contained herein, in each of the other
5
Operative Agreements and each certificate delivered pursuant to any
Operative Agreement;
(b) the performance by the parties to this Agreement of
their respective agreements contained herein and in the other Operative
Agreements to be performed by them on or prior to such date;
(c) the Agent and the Primary Financing Parties shall have
received a fully executed counterpart copy of the Requisition,
appropriately completed;
(d) [Reserved];
(e) the Construction Agent shall have delivered to the
Agent and the Primary Financing Parties a good standing certificate for
the Construction Agent in the state where the Property is located, a
copy of the Ground Lease, and a copy of the ▇▇▇▇ of Sale with respect
to the Equipment (if any), respecting such of the foregoing as are
being acquired or ground leased on such date with the proceeds of the
Loans;
(f) there shall not have occurred and be continuing any
Default or Event of Default and no Default or Event of Default will
have occurred after giving effect to the Advance requested by the
Requisition;
(g) the Construction Agent shall have delivered to the
Agent and the Primary Financing Parties separate title insurance
commitments for the Tranche A Proceeds and the Tranche B Loans to issue
policies respecting the Property, with such endorsements as the Agent
and the Primary Financing Parties deem reasonably necessary, in favor
of the Lessor and the Agent from a title insurance company reasonably
acceptable to the Agent and the Primary Financing Parties, but only
with such title exceptions thereto as are reasonably acceptable to the
Agent and the Primary Financing Parties;
(h) the Construction Agent shall have delivered to the
Agent and the Primary Financing Parties an environmental site
assessment respecting the Property prepared by an independent
recognized professional reasonably acceptable to the Agent and the
Primary Financing Parties and evidencing no pre-existing environmental
condition with respect to which there is more than a remote risk of
loss;
(i) the Construction Agent shall have delivered to the
Agent and the Primary Financing Parties an ALTA survey (with a flood
hazard certification) respecting the Property prepared by (i) an
independent recognized professional reasonably acceptable to the Agent
and the Primary Financing Parties and (ii) in a manner and including
such information as is reasonably required by the Agent and the Primary
Financing Parties;
(j) the Construction Agent shall have caused to be
delivered to the Agent and the Primary Financing Parties a legal
opinion in such form as is reasonably acceptable to the Agent and the
Primary Financing Parties with respect to local law real property
issues respecting the state in which the Property is located addressed
to the Lessor, the Agent
6
and the Primary Financing Parties, from counsel located in the state
where the Property is located, prepared by counsel reasonably
acceptable to the Agent and the Primary Financing Parties;
(k) the Agent and the Primary Financing Parties shall be
satisfied that the ground leasing of the Property and the execution of
the Mortgage Instruments and the other Security Documents will not
materially and adversely affect the rights of the Lessor, the Agent or
the Primary Financing Parties under or with respect to the Operative
Agreements;
(l) the Construction Agent shall have delivered to the
Agent and the Primary Financing Parties invoices for, or other
reasonably satisfactory evidence of, the various Transaction Expenses
and other fees, expenses and disbursements referenced in Section 7 of
this Agreement, as appropriate;
(m) the Construction Agent shall have caused to be
delivered to the Agent Mortgage Instruments (in such form as is
reasonably acceptable to the Agent and the Primary Financing Parties,
with revisions as necessary to conform to applicable state law), Lessor
Financing Statements and Primary Financing Party Financing Statements
respecting the Property, all fully executed and in recordable form;
(n) [Reserved];
(o) with respect to the Acquisition Advance, the sum of the
Available Tranche B Lender Commitment plus the Tranche A Proceeds in
the Escrow Account (after giving effect to the Acquisition Advance)
will be sufficient to pay all amounts payable therefrom;
(p) the Construction Agent shall have caused a lease
memorandum (or short form lease) to be delivered to the Agent for the
Ground Lease and, if reasonably requested by the Agent, a landlord
waiver and a mortgagee waiver (in each case, in such form as is
reasonably acceptable to the Agent);
(q) counsel (reasonably acceptable to the Agent) for the
ground lessor of the Property or counsel to the Construction Agent
shall have issued to the Lessor, the Agent and the Primary Financing
Parties, its opinion regarding the Ground Lease;
(r) the Construction Agent shall have delivered to the
Agent and the Primary Financing Parties a preliminary Construction
Budget for the Property;
(s) the Construction Agent shall have provided evidence to
the Agent and the Primary Financing Parties of insurance with respect
to the Property as provided in the Lease;
7
(t) the Construction Agent shall have caused an Appraisal
regarding the Property to be provided to the Agent and the Primary
Financing Parties from an appraiser satisfactory to the Agent and the
Primary Financing Parties;
(u) the Construction Agent shall cause (i) Uniform
Commercial Code lien searches, tax lien searches and judgment lien
searches regarding the Lessor and each Credit Party to be conducted
(and copies thereof to be delivered to the Agent and the Primary
Financing Parties) in such jurisdictions as determined by the Agent by
a nationally recognized search company acceptable to the Agent and (ii)
the liens referenced in such lien searches which are objectionable to
the Agent to be either removed or otherwise handled in a manner
satisfactory to the Agent;
(v) subject to Section 8.12, all taxes, fees and other
charges in connection with the execution, delivery, recording, filing
and registration of the Operative Agreements and/or documents related
thereto shall have been paid or provisions for such payment shall have
been made to the satisfaction of the Agent;
(w) in the reasonable opinion of the Agent and the Primary
Financing Parties and their respective counsel, the transactions
contemplated by the Operative Agreements do not and will not subject
the Lessor, the Primary Financing Parties or the Agent to any adverse
regulatory prohibitions, constraints, penalties or fines;
(x) each of the Operative Agreements to be entered into on
such date shall have been duly authorized, executed and delivered by
the parties thereto, and shall be in full force and effect, and the
Agent and the Primary Financing Parties shall have received a fully
executed copy of each of the Operative Agreements;
(y) [Reserved];
(z) the Agent and the Primary Financing Parties shall have
received an Officer's Certificate, dated as of the Closing Date, of
each Credit Party in the form attached hereto as EXHIBIT C or in such
---------
other form as is reasonably acceptable to the Agent and the Primary
Financing Parties stating that (i) each and every representation and
warranty of such Credit Party contained in the Operative Agreements to
which it is a party is true and correct on and as of the Closing Date;
(ii) no Lease Default or Lease Event of Default has occurred and is
continuing under any Operative Agreement; (iii) each Operative
Agreement to which such Credit Party is a party is in full force and
effect with respect to it except as the same may be limited by
applicable bankruptcy, insolvency, fraudulent transfer or conveyance,
reorganization, moratorium or other similar laws relating to or
affecting creditors' or lessors' rights generally and general
principles of equity; and (iv) such Credit Party 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 Closing Date;
(aa) the Agent and the Primary Financing Parties shall have
received (i) a certificate of the Secretary or an Assistant Secretary
of each Credit Party, dated as of the
8
Closing Date, in the form attached hereto as EXHIBIT D or in such other
---------
form as is reasonably acceptable to the Agent and the Primary Financing
Parties attaching and certifying as to (1) the resolutions of the Board
of Directors of such Credit Party duly authorizing the execution,
delivery and performance by such Credit Party of each of the Operative
Agreements to which it is or will be a party, (2) the articles of
incorporation of such Credit Party certified as of a recent date by the
Secretary of State of its state of incorporation and its by-laws and
(3) the incumbency and signature of persons authorized to execute and
deliver on behalf of such Credit Party the Operative Agreements to
which it is or will be a party and (ii) a good standing certificate (or
local equivalent) from the respective states where such Credit Party is
incorporated and where the principal place of business of such Credit
Party is located as to its good standing in each such state;
(bb) there shall not have occurred any material adverse
change in the consolidated assets, liabilities, operations, business or
condition (financial or otherwise) of the Credit Parties (on a
consolidated basis) from that set forth in the most recent audited
consolidated financial statements of COFC which have been provided to
the Agent;
(cc) the Agent, the Lessee and the Primary Financing Parties
shall have received an Officer's Certificate of the Lessor dated as of
the Closing Date in the form attached hereto as EXHIBIT E or in such
---------
other form as is reasonably acceptable to the Agent and the Lessee,
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 Closing Date, (ii) each Operative
Agreement to which the Lessor is a party is in full force and effect
with respect to it, (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 Closing Date and (iv) no Default or Event of Default
attributable solely to Lessor has occurred and is continuing under any
Operative Agreement;
(dd) the Agent, the Lessee and the Primary Financing Parties
shall have received (i) a certificate of the Secretary or an Assistant
Secretary of the Lessor in the form attached hereto as EXHIBIT F or in
---------
such other form as is reasonably acceptable to the Agent and the
Lessee, attaching and certifying as to (A) the signing resolutions duly
authorizing the execution, delivery and performance by the Lessor of
each of the Operative Agreements to which it is or will be a party, (B)
its articles of association or other equivalent charter documents and
its by-laws, as the case may be, certified as of a recent date by an
appropriate officer of the Lessor 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 governmental authority in the
jurisdiction of the Lessor's organization and in Virginia;
(ee) counsel for the Lessor acceptable to the Agent shall
have issued to the Lessee, the Primary Financing Parties and the Agent
its opinion in such form as is reasonably acceptable to the Agent, the
Primary Financing Parties and the Lessee;
9
(ff) the Construction Agent shall have caused to be
delivered to the Agent and the Primary Financing Parties a legal
opinion in such form as is reasonably acceptable to the Agent and the
Primary Financing Parties, addressed to the Lessor, the Agent and the
Primary Financing Parties, from counsel reasonably acceptable to the
Agent;
(gg) The Tranche A Note Purchasers shall have obtained a
private placement number for the Tranche A Notes from Standard & Poor's
CUSIP Service Bureau;
(hh) no Casualty and no Condemnation shall have occurred and
no action shall be pending or threatened by a Governmental Authority to
initiate a Condemnation; and
(ii) Lessee, the Guarantor, Lessor and the Tranche A Note
Purchasers shall have received a certificate from the Placement Agent,
in form and substance satisfactory to them, dated the Closing Date,
with respect to offerees of the Tranche A Notes.
5.4. Conditions Precedent for the Lessor, the Agent and the Tranche
--------------------------------------------------------------
B Lenders Relating to the Advance of Funds after the
----------------------------------------------------
Acquisition Advance.
-------------------
The obligations of the Agent to make Construction Advances from the
Escrow Account, and the Tranche B Lenders to make Tranche B Loans in connection
with all requests for Advances for Project Costs subsequent to the acquisition
of the Property (and to pay the Transaction Expenses, fees, expenses and other
disbursements payable under Section 7 of this Agreement in connection therewith)
are subject to the satisfaction or waiver of the following conditions precedent
(to the extent such conditions precedent require the delivery of any agreement,
certificate, instrument, memorandum, legal or other opinion, appraisal,
commitment, title insurance commitment, lien report or any other document of any
kind or type, such shall be in form and substance satisfactory to the Agent, in
its reasonable discretion; notwithstanding the foregoing, the obligations of
each party shall not be subject to any conditions contained in this Section 5.4
which are required to be performed by such party):
(a) the correctness in all material respects on such date
of the representations and warranties of the parties to this Agreement
contained herein, in each of the other Operative Agreements and in each
certificate delivered pursuant to any Operative Agreement, except to
the extent any such representation or warranty relates to an earlier
date, in which case such representation or warranty shall have been
true and correct in all material respects as of such earlier date;
(b) the performance by the Credit Parties of their
respective agreements contained herein and in the other Operative
Agreements to be performed by them on or prior to each such date;
(c) the Agent and the Primary Financing Parties shall have
received a fully executed counterpart of the Requisition, appropriately
completed;
(d) based upon the applicable Construction Budget which
shall satisfy the requirements of this Agreement, the sum of the
Available Tranche B Lender
10
Commitments plus the balance of funds in the Escrow Account will be
sufficient to complete the Improvements;
(e) there shall not have occurred and be continuing any
Lease Default or Lease Event of Default and no Event of Default by
Lessor shall have occurred and been continuing for sixty (60) days or
more, and no Lease Default or Lease Event of Default or any Event of
Default by Lessor will have occurred as a result of and after giving
effect to the Construction Advance requested by the applicable
Requisition;
(f) the title insurance policies delivered in connection
with the requirements of Section 5.3(g) shall provide for (or shall be
endorsed to provide for) insurance in an amount at least equal to the
maximum total Property Cost indicated by the applicable Construction
Budget referred to in subparagraph (d) above (divided between such
policy in favor of the Tranche A Note Purchasers and the other policy
in favor of the Tranche B Lenders based on the percentages for Advances
as set forth in Section 5.2(c)) and there shall be no title change or
exception reasonably objectionable to the Agent;
(g) [Reserved];
(h) [Reserved];
(i) the Construction Agent shall have delivered, or caused
to be delivered, to the Agent, Bills of Sale or other documents
reasonably requested by the Agent in order to perfect the interest of
the Lessor, in each case with regard to any Equipment or other
components of the Property then being acquired with the proceeds of the
Loans; and
(j) subject to Section 8.12, all taxes, fees and other
charges in connection with the execution, delivery, recording, filing
and registration of the Operative Agreements shall have been paid or
provisions for such payment shall have been made to the reasonable
satisfaction of the Agent.
5.5. Additional Reporting and Delivery Requirements on Completion
------------------------------------------------------------
Date.
----
Within ten (10) days after the Completion Date for the Property, the
Construction Agent shall deliver to the Agent and the Primary Financing Parties
an Officer's Certificate in the form attached hereto as EXHIBIT I or in such
---------
other form as is reasonably acceptable to the Agent specifying the Completion
Date for the Property and the aggregate Property Cost for the Property. The
Agent shall have the right to contest the information contained in such
Officer's Certificate. Furthermore, on or prior to the Completion Date for the
Property, the Construction Agent shall deliver or cause to be delivered to the
Agent and the Primary Financing Parties (unless previously delivered to the
Agent and the Primary Financing Parties) the following, each of which shall be
in form and substance acceptable to the Agent, in its reasonable discretion: (v)
a title insurance endorsement regarding the title insurance policy delivered in
connection with the requirements of Section 5.3(g), but only to the extent such
endorsement is necessary to provide for insurance in an amount at least equal to
the maximum total Property Cost (divided between such policy in favor of the
Tranche A Note Purchasers and the other policy in favor of
11
the Tranche B Lenders based on the percentages for Advances as set forth in
Section 5.2(c)) and, if endorsed, the endorsement shall not include a title
change or exception reasonably objectionable to the Agent; (w) an as-built
survey for the Property, (x) insurance certificates respecting such Property as
required hereunder and under the Lease and (y) if reasonably requested by the
Agent, amendments to the Lessor Financing Statements executed by the appropriate
parties. In addition, on the Completion Date, the Construction Agent covenants
and agrees that, subject to Section 8.12, the recording fees, documentary stamp
taxes or similar amounts required to be paid in connection with the related
Mortgage Instruments shall have been paid in an amount required by applicable
law, subject, however, to the obligation that such costs be funded from Tranche
A Proceeds or Tranche B Loans to the extent required pursuant to Section 7.1.
5.6. The Construction Agent Delivery of Construction Budget
------------------------------------------------------
Modifications.
-------------
(a) The Construction Agent covenants and agrees to deliver
to the Agent each month notification of any modification to the
Construction Budget regarding the Property if such modification
increases the cost to construct the Property by more than four percent
(4.0%) (in the aggregate) over the Construction Budget as of the
Closing Date; provided no Construction Budget may be increased unless
--------
(a) the title insurance policies referenced in Section 5.3(g) are also
modified or endorsed, if necessary, to provide for insurance in an
amount that satisfies the requirements of Section 5.4(f) of this
Agreement and (b) after giving effect to any such amendment, the
Construction Budget remains in compliance with the requirements of
Section 5.4(d) of this Agreement.
(b) In the event any such modification to the Construction
Budget regarding the Property increases the cost to construct the
Property by such amount as would cause the Available Tranche B Lender
Commitments plus the balance of funds remaining in the Escrow Account
to be insufficient to complete the Improvements, at the request of the
Lessee, the Tranche B Lenders may, but shall not be obligated to, in
the Tranche B Lenders' sole and absolute discretion, increase their
Tranche B Lender Commitments up to an additional $5 million without the
consent of the Tranche A Noteholders. Any further modification to the
Construction Budget regarding the Property as would cause the Available
Tranche B Lender Commitments, as increased pursuant to the preceding
sentence, plus the balance of funds remaining in the Escrow Account to
be insufficient to complete the Improvements, may be funded by
additional increases in the Tranche B Lender Commitments at the request
of the Lessee, upon such terms as the Tranche B Lenders and the Lessee
may agree, in their sole and absolute discretion, with the consent of
each of the Tranche A Noteholders.
5.7. Restrictions on Liens.
---------------------
On the Closing Date, the Construction Agent shall cause the Property
ground leased by the Lessor on such date to be free and clear of all Liens
except those referenced in Sections 6.2(r)(i) and 6.2(r)(ii), such other Liens
that are expressly set forth as title exceptions on the title commitment or
policy issued under Section 5.3(g) with respect to the Property, Liens for Taxes
that are not yet due and payable and such other Liens that have been expressly
approved or
12
agreed to by the Agent. On the date the Property is either sold to a third party
(other than the Lessee or any Affiliate or designee of the Lessee) in accordance
with the terms of the Operative Agreements or, pursuant to Section 22.1(a) of
the Lease Agreement, retained by the Lessor, the Lessee shall cause the Property
to be free and clear of all Liens (other than Lessor Liens, such other Liens
that are expressly set forth as title exceptions on the title commitment or
policy issued under Section 5.3(g) with respect to the Property, to the extent
such title commitment has been approved by the Agent, Liens for Taxes that are
not yet due and payable and such other Liens that have been expressly approved
or agreed to by the Agent).
5.8. [Reserved].
----------
5.9. [Reserved].
----------
5.10. Payments.
--------
All payments of Rent, and other amounts payable to any Financing Party
to be made by the Construction Agent or the Lessee under this Agreement or any
other Operative Agreements (excluding Excepted Payments which shall be paid
directly to the party to whom such payments are owed) shall be made to the Agent
at the office designated by the Agent from time to time by written notice as
provided herein in Dollars and in immediately available funds, without setoff,
deduction, or counterclaim. Subject to the definition of "Interest Period" in
Appendix A attached hereto, whenever any payment under this Agreement or any
----------
other Operative Agreements shall be stated to be due on a day that is not a
Business Day, such payment may be made on the next succeeding Business Day, and
such extension of time in such case shall be included in the computation of
interest and fees payable pursuant to the Operative Agreements, as applicable
and as the case may be.
5.11. Extension of Construction Period Termination Date.
-------------------------------------------------
The parties hereto agree that, so long as no Lease Default or Lease
Event of Default shall have occurred and be continuing, the Construction Agent
shall have the right upon thirty (30) days written notice to the Agent, the
Lessor and the Primary Financing Parties to extend the Construction Period
Termination Date from December 31, 2002 to February 28, 2003. The parties hereto
further agree that, so long as no Lease Default or Lease Event of Default shall
have occurred and be continuing, the Construction Agent shall have the right
upon thirty (30) days written notice to the Agent, the Lessor and the Primary
Financing Parties to further extend the Construction Period Termination Date
from February 28, 2003 to June 30, 2003; provided, in connection with such an
--------
extension until June 30, 2003, the Construction Agent shall pay a monthly
extension fee equal to the product of the Tranche B Commitments times .15% (with
proceeds from Construction Advances made in accordance with the provisions of
the Operative Agreements) to the Tranche B Lenders on each Scheduled Interest
Payment Date for each month or portion of a month during which such extension is
in effect.
13
5.12 Escrow Account.
--------------
(a) On the Closing Date, the Borrower shall cause the proceeds
from the sale of the Tranche A Notes to be deposited with the Escrow Agent in
cash in the Escrow Account, in the name of the Agent, for the benefit of the
Borrower, which will be available to pay amounts requested to be paid on the
Closing Date and for Construction Advances requested in accordance with Section
4 and Sections 5.3 and 5.4.
(b) Upon receipt by the Agent of a Requisition from the
Construction Agent in accordance with Sections 4.2 and 5.2(a) and (b), and upon
satisfaction or express waiver of the conditions set forth in Sections 5.3 or
5.4, as applicable, the Agent shall disburse from the Escrow Account Tranche A
Proceeds to the Construction Agent (on the Lessor's behalf) in the manner and in
amounts as set forth in Section 5.2(c). In the event the Tranche A Proceeds in
the Escrow Account from which such disbursements shall be made are invested in
more than one type of Cash Equivalents, the Construction Agent shall provide to
the Agent (together with the Requisition) written instructions specifying the
Cash Equivalents to be liquidated in order to fund the Advance requested in such
Requisition. In the absence of such written instructions, the Agent (in its sole
discretion) shall fund such Advance with the proceeds from any funds then on
deposit in the Escrow Account. The Lessor and the Construction Agent expressly
acknowledge and agree to release and hold the Agent harmless from any Claim
arising out of the funding of any Advance pursuant to the immediately preceding
sentence.
(c) From the Closing Date until the Completion Date (so long as no
Lease Event of Default shall have occurred and be continuing), the Agent shall
invest any Tranche A Proceeds held in the Escrow Account in cash or Cash
Equivalents, as the Construction Agent shall direct by furnishing a written
notice; provided, if a Lease Event of Default shall have occurred and be
--------
continuing or in the absence of written instructions from the Construction
Agent, all Tranche A Proceeds then on deposit in the Escrow Account shall be
invested in Cash Equivalents of the type described in clause (e) of the
definition of "Cash Equivalents". Any interest or income earned on amounts
invested in Cash Equivalents pursuant to this Section 5.12 shall be added to the
balance of funds in the Escrow Account. The Lessor and the Construction Agent
acknowledge and agree that neither the Agent nor the Escrow Agent shall be
liable or responsible for the loss or diminishment of all or any portion of the
Tranche A Proceeds deposited from time to time in the Escrow Account resulting
from any cause, except to the extent such loss or diminishment is attributable
to the gross negligence or willful misconduct of the Agent or the failure of the
Escrow Agent to use ordinary care in the handling of funds.
(d) On the Completion Date respecting the Property (provided no
Lease Default or Lease Event of Default shall have occurred and be continuing),
the Agent shall (i) disburse to the Construction Agent (on behalf of the Lessor)
any Tranche A Proceeds remaining in the Escrow Account to be used by the
Construction Agent for the construction or purchase of additional tenant
improvements and other personal property to be used in connection with the
Property as a Class A office building and related facilities or (ii) upon the
request of the Construction Agent, apply such Tranche A Proceeds remaining in
the Escrow Account (and any earnings thereon) on such date in partial payment of
the Tranche A Notes then outstanding in accordance with Section 8.2(a) of the
Note Purchase Agreement.
14
(e) The Lessor and the Construction Agent hereby acknowledge and
agree that the Escrow Account (and the Tranche A Proceeds on deposit therein
from time to time) constitutes additional Collateral to secure any and all
obligations of the Lessor and the Construction Agent to the Tranche A Note
Purchasers and the Lessor and the Construction Agent agree to execute and
deliver any agreements, financing statements, instruments or other documents
reasonably requested by the Agent to perfect the security interest of the
Tranche A Note Purchasers in the Escrow Account (including without limitation
the Assignment of Escrow Account and the Control Agreement).
(f) The Escrow Agent acknowledges and agrees to the provisions set
forth in this Section 5.12 as such provisions relate to the Escrow Account.
5.13. Partial Funding of Unreimbursed Costs Following an Agency
---------------------------------------------------------
Agreement Event of Default.
--------------------------
Notwithstanding any provision in any Operative Agreement to the
contrary, each Tranche B Lender agrees that, following an Agency Agreement Event
of Default and upon the payment by the Construction Agent of all amounts
required to be paid by the Construction Agent pursuant to Section 5.4 of the
Agency Agreement (if the Construction Agent has not elected to cure such Agency
Agreement Event of Default by purchasing the Property pursuant to Section 5.3(c)
of the Agency Agreement), such Tranche B Lender will make a Tranche B Loan (up
to such Tranche B Lender's Available Tranche B Lender Commitment) to the
Construction Agent, on behalf of the Borrower, in an amount equal to 10.1% of
the accreted value of any unreimbursed costs actually paid by the Construction
Agent in connection with the construction of the Property; provided, however, no
-------- -------
Tranche B Lender shall be required to make such a Tranche B Loan unless the
Construction Agent shall have submitted to the Agent a Requisition adequately
describing the costs for which the Construction Agent is seeking reimbursement,
together with evidence reasonably satisfactory to the Agent that such amounts
have in fact been paid by the Construction Agent.
5.14. Lessee's Right to Replace Non-Consenting Primary Financing
----------------------------------------------------------
Parties.
-------
In the event that the Construction Agent or the Lessee requests the
consent of any Tranche A Note Purchaser or any Tranche B Lender to any proposed
action, and such Tranche A Note Purchaser or such Tranche B Lender refuses or
fails to provide such consent, the Lessee shall have the right, subject to the
repayment in full (by means of a purchase from an assignee or otherwise) of all
Tranche A Notes or Tranche B Loans, together with all accrued interest through
the date of such purchase or assignment, and all other amounts due such Tranche
A Note Purchaser or Tranche B Lender (including without limitation any
Make-Whole Amount which would have been payable had the Tranche A Notes held by
any Tranche A Note Purchaser prior to the assignment contemplated herein been
repaid on the date of such assignment), to replace such Tranche A Note Purchaser
or such Tranche B Lender by requiring such Tranche A Note Purchaser or such
Tranche B Lender to assign, without recourse, representation or warranty its
interests, rights (except for rights to be indemnified for actions taken while a
party hereunder) and obligations under the Operative Agreements (including,
without limitation the Note Purchase
15
Agreement or the Credit Agreement, as the case may be) in accordance with the
procedure set forth in Section 13.2 of the Note Purchase Agreement or Section
2.11(b) of the Credit Agreement, as the case may be.
5.15 Rights of Tranche A Note Purchasers Upon Merger and Change of
-------------------------------------------------------------
Director Control of COB, FSB or COFC or Upon Downgrade of Debt
--------------------------------------------------------------
Rating of COB.
-------------
(a) If, as of the Rent Commencement Date under the Lease or any
time thereafter, a transaction of merger, consolidation, amalgamation or similar
reorganization of, or sale of all, or substantially all, of the assets of COB,
FSB or COFC has occurred since the Closing Date and has resulted in (i) (A) if
all three Rating Agencies rate COB or FSB, as appropriate, two of the Rating
Agencies lowering their then-current Debt Rating of COB or FSB or any successor
pursuant to this Section 5.15, (B) if only two Rating Agencies rate COB or FSB,
as appropriate, both of the Rating Agencies lowering their then-current Debt
Rating of COB or FSB or any successor pursuant to this Section 5.15, (C) if only
one Rating Agency rates COB or FSB, as appropriate, such Rating Agency lowering
its then-current Debt Rating of COB or FSB or any successor pursuant to this
Section 5.15, or (D) if a "private letter" rating for COB or FSB, as
appropriate, has been issued pursuant to Section 8.3(ii) of the Participation
Agreement, the "private letter" rating for COB or FSB, as appropriate, shall be
lowered from the rating in effect immediately prior to such merger,
consolidation, amalgamation or sale and (ii) a change in the then-current board
of directors of COB, FSB or COFC, as the case may be, such that the directors of
such entity immediately prior to such merger event do not constitute a majority
of the directors of the surviving entity immediately following such event, then
any Tranche A Note Purchaser shall have the right, but not the obligation,
within sixty (60) days thereafter to require the Lessor to pay to the Agent (on
behalf of such Tranche A Note Purchaser), an amount equal to the principal
amount outstanding on the Tranche A Note held by such Tranche A Note Purchaser,
together with interest accrued thereon to the date of such payment and all other
amounts attributable to such Tranche A Note but without any Make Whole Amount,
in full satisfaction of such Tranche A Note. Upon any such payment, any such
Tranche A Note shall be deemed to be discharged. If either COB or FSB has
outstanding unsecured, unsupported, senior long-term debt obligations and such
entity is no longer rated by a Rating Agency, such withdrawal or termination of
its rating, other than by reason of such Rating Agency no longer existing, shall
be deemed a "lowering" of such entity's Debt Rating.
(b) If, after the Rent Commencement Date under the Lease, (i) if
all three Rating Agencies rate COB, two of the Rating Agencies lower their
rating of COB's Debt Rating to B+ or the equivalent or lower, (ii) if only two
Rating Agencies rate COB, both of the Rating Agencies lower their rating of
COB's Debt Rating to B+ or the equivalent or lower, (iii) if only one Rating
Agency rates COB, such Rating Agency lowers its rating of COB's Debt Rating to
B+ or the equivalent or lower, or (iv) if a "private letter" rating has been
issued pursuant to Section 8.3(ii) of the Participation Agreement, the "private
letter" rating for COB shall be lowered to B+ or the equivalent or lower, then
for so long as such Debt Rating remains below such levels, any Tranche A Note
Purchaser shall have the right, but not the obligation, to require the Lessor to
pay the Agent on behalf of such Tranche A Note Purchaser an amount equal to all
principal amounts outstanding under its Tranche A Notes, together with interest
accrued thereon to the date of such prepayment plus the Make-Whole Amount
determined on such purchase date
16
with respect to such principal amount of such Tranche A Notes. Upon such
payment, such Tranche A Notes shall be deemed to be discharged. If COB has
unsecured, unsupported, senior long-term debt obligations and COB is no longer
rated by a Rating Agency, such withdrawal or termination of its rating, other
than by reason of such Rating Agency no longer existing, shall be deemed to be a
downgrade to B+ or equivalent for the foregoing purposes.
SECTION 6. REPRESENTATIONS AND WARRANTIES.
6.1. Representations and Warranties of the Borrower.
---------------------------------------------
The Borrower represents and warrants to each of the other parties
hereto that as of the Closing Date and the date of each Advance (except to the
extent any such representation or warranty relates to an earlier date):
(a) It is a corporation duly organized and validly existing
and in good standing under the laws of the State of North Carolina, is
qualified to do business in Virginia and in each jurisdiction necessary
to permit the Borrower to own and lease the Property and perform its
obligations under the Operative Agreements and has the power and
authority to enter into and perform its obligations under each of the
Operative Agreements 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 such Closing Date in connection with or as contemplated by
each such Operative Agreement to which the Borrower is or will be a
party, and is a multi-purpose, Wholly-Owned Entity of First Union
Corporation;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party has been duly authorized by
all necessary action on its part and neither the execution and delivery
thereof, nor the consummation of the transactions contemplated thereby,
nor compliance by it with any of the terms and provisions thereof (i)
does or will require any approval or consent of any trustee or holders
of any of its indebtedness or obligations or any other consent or
approval that has not previously been obtained, (ii) does or will
contravene any Legal Requirement, (iii) does or will contravene or
result in any breach of or constitute any default under, or result in
the creation of any Lien upon any of its property under, (A) its
charter or by-laws, or (B) any indenture, mortgage, chattel mortgage,
deed of trust, conditional sales contract, bank loan or credit
agreement or other agreement or instrument to which it is a party or by
which it or its properties may be bound or affected, which
contravention, breach, default or Lien under clause (B) could
reasonably be expected to materially and adversely affect its ability
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 or (iv)
does or will require any Governmental Action by any Governmental
Authority;
(c) Each Operative Agreement to which the Borrower is or will
be a party have been, or on or before such Closing Date or date of
Advance will be, duly executed
17
and delivered by the Borrower, and each Operative Agreement to which
the Borrower is a party constitutes, or upon execution and delivery
will constitute, a legal, valid and binding obligation enforceable
against the Borrower 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 before any
Governmental Authority 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 or would question the
validity or enforceability of any of the Operative Agreements to which
it is or will become a party;
(e) The Borrower has not assigned or transferred any of its
right, title or interest in or under the Lease, the Agency Agreement or
its interest in the Property or any portion thereof, 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) Except as otherwise contemplated in the Operative
Agreements, the proceeds of the Advances shall not be applied by the
Borrower for any purpose other than the purchase and/or lease of the
Property, the acquisition, installation and testing of the Equipment,
the construction of Improvements and the payment of interest,
Transaction Expenses and the fees, expenses and other disbursements
referenced in the Operative Agreements, in each case which accrue prior
to the Rent Commencement Date with respect to the Property;
(h) Neither the Borrower nor any Person authorized by the
Borrower to act on its behalf has offered or sold any interest in the
Borrower's Interest or the Notes, or in any similar security relating
to the Property, or in any security the offering of which for the
purposes of the Securities Act would be deemed to be part of the same
offering as the offering of the aforementioned securities to, or
solicited any offer to acquire any of the same from, any Person other
than, in the case of the Notes, the Agent and seventy-one (71) other
institutions, and neither the Borrower nor any Person authorized by the
Borrower 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 Borrower's Interest or the Notes to the provisions of
Section 5 of the Securities Act or require the qualification of any
Operative Agreement under the Trust Indenture Act of 1939, as amended;
(i) The Borrower's principal 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 One First Union
Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇;
(j) The Borrower is not engaged principally in, and does not
have as one (1) of its important activities, the business of extending
credit for the purpose of purchasing
18
or carrying any margin stock (within the meaning of Regulation U), and
no part of the proceeds of the Loans will be used by it to purchase or
carry any margin stock or to extend credit to others for the purpose of
purchasing or carrying any such margin stock or for any purpose that
violates, or is inconsistent with, the provisions of Regulations T, U,
or X;
(k) The Borrower is not an "investment company" or a company
controlled by an "investment company" within the meaning of the
Investment Company Act;
(l) The Property is free and clear of all Lessor Liens
attributable to the Lessor;
(m) [Reserved];
(n) The Borrower's true legal name as registered in the
jurisdiction of its organization is First Union Development Corporation
and its Federal Employer Identification Number is ▇▇-▇▇▇▇▇▇▇. The
Borrower does not use, or transact any business under, any trade name
other than its legal name; and
(o) The Borrower has filed all tax returns and all other
material reports that are required under applicable Law to be filed by
them and has paid all taxes or other charges of any Governmental
Authority due pursuant to such returns or other reports, except for any
taxes or other charges that are being diligently contested in good
faith by appropriate proceedings and for which adequate reserves have
been set aside on the books and records of the Borrower.
6.2. Representations and Warranties of the Lessee.
--------------------------------------------
Lessee represents and warrants to each of the other parties hereto that
as of the Closing Date and the date of each Advance (except to the extent that
any such representation or warranty relates to an earlier date):
(a) [Reserved];
(b) The execution and delivery by the Lessee of this Agreement
and the other applicable Operative Agreements to which the Lessee is a
party as of such date and the performance by the Lessee of its
obligations under this Agreement and the other applicable Operative
Agreements to which the Lessee is a party do not and will not result
in, or require, the creation or imposition of any Lien (other than
pursuant to the terms of the Operative Agreements) on any asset of the
Lessee;
(c) [Reserved];
(d) Except as set forth on EXHIBIT K, there are no actions,
---------
suits or proceedings pending or, to Lessee's knowledge, threatened
against the Lessee in any court or before any Governmental Authority
(nor shall any order, judgment or decree
19
have been issued or, to the knowledge of the Lessee, proposed to be
issued by any Governmental Authority against the Lessee to set aside,
restrain, enjoin or prevent the full performance of any Operative
Agreement or any transaction contemplated thereby) that (i) concern the
Property or Lessee's interest therein, (ii) question the validity or
enforceability of any Operative Agreement to which the Lessee is a
party or the overall transaction described in the Operative Agreements
to which the Lessee is a party or (iii) have or could reasonably be
expected to have a Material Adverse Effect (but only as of the Closing
Date with respect to a Material Adverse Effect of the type referred to
in clause (a) of the definition thereof);
(e) No Governmental Action by any Governmental Authority or
other authorization, registration, consent, approval, waiver, notice or
other action by, to or of any other Person pursuant to any Legal
Requirement or any contract, indenture, instrument or agreement or for
any other reason is required to authorize or is required in connection
with (i) the execution, delivery or performance by Lessee of any
Operative Agreement to which the Lessee is a party, (ii) the legality,
validity, binding effect or enforceability against Lessee of any
Operative Agreement to which the Lessee is a party, (iii) the
acquisition, ownership, construction, completion, occupancy, operation,
leasing or subleasing by Lessee of the Property or (iv) the
Construction Agent's request for any Advance, in each case, except
those which have been obtained and are in full force and effect or
where failure to obtain the same could not reasonably be expected to
have a Material Adverse Effect;
(f) Upon the execution and delivery of the Lease Supplement to
the Lease, (i) the Lessee will have unconditionally accepted the
Property subject to the Lease Supplement, and (ii) no offset will exist
with respect to any Rent or other sums payable under the Lease;
(g) [Reserved];
(h) All information with respect to Lessee or any of its
Affiliates heretofore or contemporaneously herewith furnished in
writing by Lessee (or any of its Affiliates) to the Agent, the Lessor
or any Primary Financing Party for purposes of or in connection with
this Agreement and the transactions contemplated hereby is 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 omit to state any material fact necessary to make such
information, taken as a whole, not misleading; provided, that no
representation is made with respect to competitor, market, forward -
looking or any other information provided to the Credit Parties by
third parties unrelated to any Credit Party and attributed to such
third party;
(i) The principal place of business, chief executive office
and office of the Construction Agent and the Lessee where the
documents, accounts and records relating to the transactions
contemplated by this Agreement and each other Operative Agreement are
kept are located at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
or, following the Completion Date, at the address of the Property, and
the states of formation and the chief
20
executive offices of each other Credit Party are located at the places
set forth in EXHIBIT L;
---------
(j) The representations and warranties of Lessee set forth in
any of the Operative Agreements are true and correct. There exists no
Lease Default or Lease Event of Default under any of the Operative
Agreements which is continuing and which has not been cured within any
cure period expressly granted under the terms of the applicable
Operative Agreement or otherwise waived in accordance with the
applicable Operative Agreement;
(k) The Property being financed consists of (i) a leasehold
interest in unimproved Land or (ii) a leasehold interest in Land and
existing Improvements thereon which Improvements are either suitable
for occupancy at the time of ground leasing or will be demolished,
renovated and/or modified in accordance with the terms of this
Agreement;
(l) [Reserved];
(m) [Reserved];
(n) [Reserved];
(o) [Reserved];
(p) [Reserved];
(q) [Reserved];
(r) (i) The Security Documents create, as security for the
Obligations (as such term is defined in the Security
Agreement), valid and enforceable security interests in, and
Liens on, all of the Collateral, in favor of the Agent, for
the benefit of the Secured Parties and such security interests
and Liens are subject to no other Liens other than Liens that
are expressly set forth as title exceptions on the title
commitment issued in accordance with Section 5.3(g) with
respect to the Property; and
(ii) The Lease Agreement creates, as security for the
obligations of the Lessee under the Lease Agreement, valid and
enforceable security interests in, and Liens on, the Property
leased thereunder, in favor of the Lessor, and such security
interests and Liens are subject to no other Liens other than
Liens that are expressly set forth as title exceptions on the
title commitment issued in accordance with Section 5.3(g) with
respect to the Property.
(s) (i) Neither Lessee nor any Subsidiary of Lessee is
engaged principally, or as one of its more important
activities, in the business of extending
21
credit for the purposes of buying or carrying Margin Stock (as
defined in Regulation U).
(ii) No part of the proceeds of any Advance will be
used, whether directly or indirectly, and whether immediately,
incidentally or ultimately, for any purpose that entails a
violation of, or that is inconsistent with, the provisions of
the Regulations of the Board including Regulation T, U or X.
(t) Except as otherwise could not reasonably be expected to
have a Material Adverse Effect, to Lessee's knowledge, which knowledge
is based solely upon its review of that certain Phase I environmental
report delivered pursuant to Section 5.3(h):
(i) The Property (including soils, surface waters,
groundwaters on, at or under the Property) does not contain
and is not otherwise affected by, and to Lessee's knowledge
has not previously contained or been affected by, any
Hazardous Substance in amounts or concentrations which (A)
constitute or constituted a violation of applicable
Environmental Laws or (B) could give rise to liability or
obligation under applicable Environmental Laws;
(ii) The Property and all operations conducted in
connection therewith are in compliance, and have been in
compliance, with all applicable Environmental Laws, and there
are no Hazardous Substances at, under or about the Property or
such operations which could reasonably be expected to
interfere with the continued operation of the Property;
(iii) Lessee and all Subsidiaries of Lessee have
obtained, are in compliance with, and have made all
appropriate filings for issuance or renewal of, all
environmental permits with respect to the Property, and all
such environmental permits are in full force and effect;
(iv) Neither Lessee nor any Subsidiary thereof has
received any notice of violation, alleged violation,
noncompliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws,
in each case, with respect to the Property, nor does Lessee
have knowledge or reason to believe that any such notice will
be received or is being threatened;
(v) Hazardous Substances have not been transported or
disposed of from the Property in violation of, or in a manner
or to a location which could reasonably be expected to give
rise to liability under, applicable Environmental Laws, nor
have any Hazardous Substances been generated, treated, stored
or disposed of at, on or under the Property in violation of,
or in a manner which could reasonably be expected to give rise
to liability under, any applicable Environmental Laws;
(vi) No judicial proceedings or governmental or
administrative action is pending, or threatened, under any
applicable Environmental Law with respect
22
to the Property to which Lessee or any Subsidiary thereof has
been or will be named as a party, nor are there any consent
decrees or other decrees, consent orders, administrative
orders or other orders, or other administrative or judicial
requirements outstanding under any applicable Environmental
Law with respect to the Property;
(vii) There has been no release, or threat of release,
of Hazardous Substances at or from the Property, in violation
of or in amounts or in a manner that could reasonably be
expected to give rise to liability under applicable
Environmental Laws; and
(viii) Neither Lessee nor any Subsidiary of Lessee (A)
has failed to comply with any applicable Environmental Law or
to obtain, maintain or comply with any applicable permit,
license or other approval required under any applicable
Environmental Law or (B) has become subject to any
Environmental Law or (C) has become subject to any
Environmental Claim.
(u) The issuance, sale and delivery of the Tranche A Notes and
the interests in the Operative Agreements under the circumstances
contemplated hereby do not require the registration or qualification of
such Tranche A Notes or interests under the Securities Act, any state
securities laws, or the Trust Indenture Act of 1939. Neither Lessee nor
Guarantor nor anyone authorized to act on any Credit Party's behalf
has, directly or indirectly, solicited any offers to acquire, offered
or sold: (i) any interest in the Tranche A Notes, the Property, the
Lease or the Operative Agreements in violation of Section 5 of the
Securities Act or any state securities laws, or (ii) any interest in
any security or lease the offering of which, for purposes of the
Securities Act or any state securities laws, would be deemed to be part
of the same offering as the offering of the aforementioned interests.
Neither the Credit Parties nor anyone authorized to act on their behalf
was involved in (y) offering or soliciting offers for the Tranche A
Notes (or any similar securities) or (z) selling Notes (or any similar
securities) to any Person other than the Tranche A Note Purchasers and
Tranche B Lenders identified and contacted by the Placement Agent and
not more than seventy-one (71) other institutional investors.
(v) The Property is located in Fairfax County, Virginia. The
Property and any present use and presently anticipated future use
thereof by Lessee and its agents, assignees, employees, invitees,
lessees, licensees and tenants comply with all Legal Requirements
(including zoning and land use laws and Environmental Laws) and
Insurance Requirements, except for such instances of non-compliance
that could not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect. No notices, complaints or orders
of violation or non-compliance or liability have been issued to a
Credit Party or, to the best of its knowledge, threatened by any Person
with respect to the Property or the present or intended future use
thereof, except for such violations and instances of non-compliance as
could not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect, and Lessee and Guarantor are not
aware of any circumstances which could give rise to the issuance of any
such notices, complaints or orders.
23
6.3 Additional Representations and Warranties of FSB.
------------------------------------------------
FSB represents and warrants to each of the other parties hereto that as
of the Closing Date and the date of each Advance (except to the extent that any
such representation or warranty relates to an earlier date):
6.3.1 Organization; Power and Authority.
---------------------------------
FSB and each of its Subsidiaries: (a) is a corporation,
partnership or other entity duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization;
(b) has all requisite corporate or other power, and has all material
governmental licenses, authorizations, consents and approvals necessary
to own its assets and carry on its business as now being conducted; and
(c) is qualified to do business and is in good standing in Virginia and
in all other jurisdictions in which the nature of the business
conducted by it makes such qualification necessary and where failure so
to qualify could (either individually or in the aggregate) have a
Material Adverse Effect.
6.3.2 Authorization, etc.
------------------
FSB has all necessary corporate power, authority and legal
right to execute, deliver and perform its obligations under each of the
Operative Agreements to which it is a party and to consummate the
transactions contemplated thereby; the execution, delivery and
performance by FSB of each of the Operative Agreements to which it is a
party and the consummation of the transactions contemplated thereby
have been duly authorized by all necessary corporate action on its part
(including, without limitation, any required shareholder approvals);
and this Agreement and each of the Operative Agreements to which it is
a party have been duly and validly executed and delivered by FSB and
constitute its legal, valid and binding obligations, enforceable
against FSB in accordance with its terms, except as may be limited by
(a) bankruptcy, insolvency, receivership, conservatorship,
reorganization, moratorium or similar laws of general applicability
affecting the enforcement of creditors' rights and (b) the application
of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
6.3.3 [Reserved].
--------
6.3.4 Financial Statements.
--------------------
FSB has heretofore furnished to the Agent and each of the
Primary Financing Parties a consolidated balance sheet of Parent and
its Subsidiaries as at December 31, 1999 and the related consolidated
statements of income, changes in stockholders' equity and cash flows of
Parent and its Subsidiaries for the fiscal year ended on said date,
with the opinion thereon of Ernst & Young LLP, and the unaudited
consolidated balance sheet of Parent and its Subsidiaries as at
September 30, 2000 and the related consolidated statements of income,
changes in stockholders' equity and cash flows of Parent and its
24
Subsidiaries for the nine-month period ended on such date. All such
financial statements present fairly, in all material respects, the
consolidated financial condition of Parent and its Subsidiaries as at
said dates and the consolidated results of their operations and their
cash flows for the fiscal year and nine-month period, respectively,
ended on said dates (subject, in the case of such financial statements
as at September 30, 2000, to normal year-end audit adjustments), all in
accordance with GAAP. As of the Closing Date, since December 31, 1999,
there has been no material adverse change in the property, business,
operations, financial condition, prospects or capitalization of Parent
and its Subsidiaries taken as a whole from that set forth in said
financial statements as at said date.
6.3.5 Compliance with Laws, Other Instruments, etc.
--------------------------------------------
None of the execution and delivery of this Agreement or the
other Operative Agreements to which FSB is a party, the consummation of
the transactions herein or therein contemplated or compliance with the
terms and provisions hereof or thereof will conflict with or result in
a breach of, or require any consent under, the charter or by-laws of
FSB, or any applicable law or regulation, or any order, writ,
injunction or decree of any court or governmental authority or agency,
or any agreement or instrument to which FSB or any of its Subsidiaries
is a party or by which any of them or any of their property is bound or
to which any of them is subject, or constitute a default under any such
agreement or instrument, except for any such conflict, breach or
default that, or consent that if not obtained, could not (either
individually or in the aggregate) have a Material Adverse Effect and
could not subject any Financing Party to liability.
6.3.6 [Reserved].
--------
6.3.7 [Reserved].
--------
6.3.8 [Reserved].
--------
6.3.9 Compliance with ERISA.
---------------------
(a) Each Plan, and, to the knowledge of FSB, each
Multiemployer Plan, is in compliance in all material respects
with, and has been administered in all material respects in
compliance with, the applicable provisions of ERISA, the Code
and the Age Discrimination in Employment Act, as amended, and
no event or condition has occurred and is continuing as to
which FSB would be under an obligation to furnish a report to
the Financing Parties under Section 8.3A.1(f) hereof.
(b) The execution and delivery of this Agreement or
other Operative Agreements will not involve any transaction
that is subject to the prohibitions of Section 406 of ERISA or
in connection with which a tax could be imposed pursuant to
Section 4975(c)(1)(A)-(D) of the Code. The representation by
FSB in the first sentence of this Section 6.3.9(b) is made in
reliance upon and subject to the accuracy of the
representations of the Tranche A Note Purchasers in
25
Section 6.2 of the Note Purchase Agreement as to the sources
of the funds used to pay the purchase price of the Tranche A
Notes to be purchased by them thereunder.
6.3.10 Offering of the Tranche A Notes, etc.
------------------------------------
Neither FSB nor anyone authorized to act on its behalf has
offered the Tranche A Notes or any similar securities for sale to, or
solicited any offer to buy any of the same from, or otherwise
approached or negotiated in respect thereof with, any person other than
the Tranche A Note Purchasers and not more than seventy-one (71) other
institutional investors (all such other investors being "accredited
investors" as defined under Rule 501(a) of the Securities Act). Neither
FSB nor anyone authorized to act on its behalf has taken, or will take,
any action that would subject the execution and delivery of this
Agreement and each of the other Operative Agreements or the issuance or
sale of the Tranche A Notes to the registration requirements of Section
5 of the Securities Act.
6.3.11 Status under Certain Statutes.
-----------------------------
(a) None of FSB or any of FSB's Subsidiaries is an
"investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment
Company Act.
(b) None of FSB or any of FSB's Subsidiaries is a
"holding company", or an "affiliate" of a "holding company" or
a "subsidiary company" of a "holding company", within the
meaning of the Public Utility Holding Company Act of 1935, as
amended.
6.3.12 Legal Name; Trade Names.
-----------------------
FSB's true legal name as registered in the
jurisdiction of its organization is "Capital One, F.S.B.", its
federal employer identification number is ▇▇-▇▇▇▇▇▇▇. FSB does
not use, or transact any business under, any trade name other
than its legal name.
6.4 Additional Representations, Warranties and Covenants of COB.
-----------------------------------------------------------
COB represents and warrants to each of the other parties hereto that as
of the Closing Date and the date of each Advance (except to the extent that any
such representation or warranty relates to an earlier date):
6.4.1 Organization; Power and Authority.
---------------------------------
COB and each of its Subsidiaries: (a) is a corporation,
partnership or other entity duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization;
(b) has all requisite corporate or other power, and has all material
governmental licenses, authorizations, consents and approvals necessary
to own its assets
26
and carry on its business as now being conducted; and (c) is qualified
to do business and is in good standing in Virginia and in all other
jurisdictions in which the nature of the business conducted by it makes
such qualification necessary and where failure so to qualify could
(either individually or in the aggregate) have a Material Adverse
Effect. COB is a member in good standing with the Federal Reserve
System, and COB's deposit accounts are insured by the Federal Deposit
Insurance Corporation, and no proceedings for the termination or
revocation of such insurance are pending or, to the knowledge of COB,
threatened.
6.4.2 Authorization, etc.
------------------
COB has all necessary corporate power, authority and legal
right to execute, deliver and perform its obligations under each of the
Operative Agreements to which it is a party and to consummate the
transactions contemplated thereby; the execution, delivery and
performance by COB of each of the Operative Agreements to which it is a
party and the consummation of the transactions contemplated thereby
have been duly authorized by all necessary corporate action on its part
(including, without limitation, any required shareholder approvals);
and this Agreement and each of the other Operative Agreements to which
it is a party have been duly and validly executed and delivered by COB
and constitute its legal, valid and binding obligations, enforceable
against COB in accordance with its terms, except as may be limited by
(a) bankruptcy, insolvency, receivership, conservatorship,
reorganization, moratorium or similar laws of general applicability
affecting the enforcement of creditors' rights and (b) the application
of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
6.4.3 [Reserved].
--------
6.4.4 Financial Statements.
--------------------
COB has heretofore furnished to the Agent and each of the
Primary Financing Parties a consolidated balance sheet of Parent and
its Subsidiaries as at December 31, 1999 and the related consolidated
statements of income, changes in stockholders' equity and cash flows of
Parent and its Subsidiaries for the fiscal year ended on said date,
with the opinion thereon of Ernst & Young LLP, and the unaudited
consolidated balance sheet of Parent and its Subsidiaries as at
September 30, 2000 and the related consolidated statements of income,
changes in stockholders' equity and cash flows of Parent and its
Subsidiaries for the nine-month period ended on such date. All such
financial statements present fairly, in all material respects, the
consolidated financial condition of Parent and its Subsidiaries as at
said dates and the consolidated results of their operations and their
cash flows for the fiscal year and nine-month period, respectively,
ended on said dates (subject, in the case of such financial statements
as at September 30, 2000, to normal year-end audit adjustments), all in
accordance with GAAP. As of the Closing Date, since December 31, 1999,
there has been no material adverse change in the property, business,
operations, financial condition, prospects or capitalization of Parent
and its Subsidiaries taken as a whole from that set forth in said
financial statements as at said date.
27
6.4.5 Compliance with Laws, Other Instruments, etc.
--------------------------------------------
None of the execution and delivery of this Agreement and the
other Operative Agreements to which COB is a party, the consummation of
the transactions herein or therein contemplated or compliance with the
terms and provisions hereof or thereof will conflict with or result in
a breach of, or require any consent under, the charter or by-laws of
COB, or any applicable law or regulation, or any order, writ,
injunction or decree of any court or governmental authority or agency,
or any agreement or instrument to which COB or any of its Subsidiaries
is a party or by which any of them or any of their property is bound or
to which any of them is subject, or constitute a default under any such
agreement or instrument, except for any such conflict, breach or
default that, or consent that if not obtained, could not (either
individually or in the aggregate) have a Material Adverse Effect and
could not subject any Financing Party to liability.
6.4.6 [Reserved].
--------
6.4.7 [Reserved].
--------
6.4.8 [Reserved].
--------
6.4.9 Compliance with ERISA.
---------------------
(a) Each Plan, and, to the knowledge of COB, each
Multiemployer Plan, is in compliance in all material respects
with, and has been administered in all material respects in
compliance with, the applicable provisions of ERISA, the Code
and the Age Discrimination in Employment Act, as amended, and
no event or condition has occurred and is continuing as to
which COB would be under an obligation to furnish a report to
the Financing Parties under Section 8.3C.1(f) hereof.
(b) The execution and delivery of this Agreement and
each of the other Operative Agreements will not involve any
transaction that is subject to the prohibitions of Section 406
of ERISA or in connection with which a tax could be imposed
pursuant to Section 4975(c)(1)(A)-(D) of the Code. The
representation by COB in the first sentence of this Section
6.4.9(b) is made in reliance upon and subject to the accuracy
of the representations of the Tranche A Note Purchasers in
Section 6.2 of the Note Purchase Agreement as to the sources
of the funds used to pay the purchase price of the Tranche A
Notes to be purchased by them thereunder.
6.4.10 Offering of the Tranche A Notes, etc.
------------------------------------
Neither COB nor anyone authorized to act on its behalf has
offered this Agreement or any of the other Operative Agreements or the
Tranche A Notes or any similar securities for sale to, or solicited any
offer to buy any of the same from, or
28
otherwise approached or negotiated in respect thereof with, any person
other than the Tranche A Note Purchasers and not more than seventy-one
(71) other institutional investors (all such other investors being
"accredited investors" as defined under Rule 501(a) of the Securities
Act). Neither COB nor anyone authorized to act on its behalf has taken,
or will take, any action that would subject the execution and delivery
of this Agreement and each of the other Operative Agreements or the
issuance or sale of the Tranche A Notes to the registration
requirements of Section 5 of the Securities Act.
6.4.11 Status under Certain Statutes.
-----------------------------
(a) None of COB or any of COB's Subsidiaries is an
"investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment
Company Act.
(b) None of COB or any of COB's Subsidiaries is a
"holding company", or an "affiliate" of a "holding company" or
a "subsidiary company" of a "holding company", within the
meaning of the Public Utility Holding Company Act of 1935, as
amended.
6.4.12 Legal Name; Trade Names.
-----------------------
(a) COB's true legal name as registered in the
jurisdiction of its organization is "Capital One Bank", its
federal employer identification number is ▇▇-▇▇▇▇▇▇▇. COB does
not use, or transact any business under, any trade name other
than its legal name.
SECTION 7. PAYMENT OF CERTAIN EXPENSES.
7.1. Transaction Expenses.
--------------------
(a) The Lessor agrees on the Closing Date, to pay, or cause to
be paid, all Transaction Expenses arising from the Closing Date,
including without limitation all reasonable fees, expenses and
disbursements of ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC, as counsel for the Agent and
the Lessor, and ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇, as counsel for the Tranche A Note
Purchasers (but excluding the fees, expenses and disbursements of
counsel for any individual Tranche A Note Purchaser), the Lessor and
the Agent in connection with the transactions contemplated by the
Operative Agreements and incurred in connection with such Closing Date,
the reasonable out-of-pocket expenses of the Lessor due and payable on
such Closing Date, all fees, taxes and expenses for the recording,
registration and filing of documents and all other reasonable fees,
expenses and disbursements incurred in connection with such Closing
Date; provided, however, the Lessor shall be required to pay such
-------- -------
amounts described in this Section 7.1(a) only if (i) such amounts are
properly described in a Requisition delivered on or before the Closing
Date, and (ii) funds are made available by the Tranche B Lenders and by
the Agent (from the Escrow Account) in connection with such Requisition
in an amount sufficient to allow such payment. On
29
the 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 Tranche B Lenders shall make
Tranche B Loans, and the Agent shall advance funds from the Escrow
Account, to the Lessor to pay for the Transaction Expenses, fees,
expenses and other disbursements referenced in this Section 7.1(a). The
Lessee agrees to timely pay all amounts referred to in this Section
7.1(a) to the extent the Lessor is not required to pay such amounts.
(b) Assuming no Lease Default or Lease Event of Default shall
have occurred and be continuing and only for the period prior to the
Rent Commencement Date, the Lessor agrees on the Closing Date, on the
date of any Construction Advance and on the Completion Date to pay, or
cause to be paid, all Transaction Expenses including without limitation
all reasonable fees, expenses and disbursements of ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇,
PLLC, as counsel for the Agent and the Lessor, and ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇,
as counsel for the Tranche A Note Purchasers (but excluding the fees,
expenses and disbursements of counsel for any individual Tranche A Note
Purchaser), in connection with the transactions contemplated by the
Operative Agreements and billed in connection with such Advance or such
Completion Date, all amounts described in Section 7.1(a) of this
Agreement which have not been previously paid, the reasonable
out-of-pocket expenses of the Lessor, all fees, expenses and
disbursements incurred with respect to the various items referenced in
Sections 5.3, 5.4 and/or 5.5 (including without limitation any premiums
for title insurance policies and charges for any updates to such
policies), all fees, expenses and disbursements incurred with respect
to obtaining a rating from the National Association of Insurance
Commissioners and all other reasonable fees, expenses and disbursements
in connection with such Advance or such Completion Date including
without limitation all expenses relating to and all fees, taxes and
expenses for the recording, registration and filing of documents and
during the Commitment Period, all fees, expenses and costs referenced
in Sections 7.3(a), 7.3(b) and 7.3(d); provided, however, the Lessor
-------- -------
shall be required to pay such amounts described in this Section 7.1(b)
only if (i) such amounts are properly described in a Requisition
delivered on the applicable date and (ii) funds are made available by
the Tranche B Lenders and by the Agent (from the Escrow Account), in
connection with such Requisition in an amount sufficient to allow such
payment. On the Closing Date, on the date of any Construction Advance
or the Completion Date, after delivery of the applicable Requisition
and satisfaction or express waiver of the other conditions precedent
for such date, the Agent shall advance Tranche A Proceeds from the
Escrow Account and the Tranche B Lenders shall make Tranche B Loans to
the Lessor to pay for the Transaction Expenses, fees, expenses and
other disbursements referenced in this Section 7.1(b). The Lessee
agrees to timely pay all amounts referred to in this Section 7.1(b) to
the extent the Lessor is not required to pay such amounts.
(c) All fees payable pursuant to the Operative Agreements
shall be calculated on the basis of a year of three hundred sixty (360)
days for the actual days elapsed.
30
7.2. Brokers' Fees.
-------------
The Lessee agrees to pay or cause to be paid any and all brokers' fees,
if any, including without limitation any interest and penalties thereon, which
are payable in connection with the transactions contemplated by this Agreement
and the other Operative Agreements, excluding the fees of any brokers retained
by the Agent, any Primary Financing Party, the Lessor or any Affiliate of any of
the foregoing.
7.3. Certain Fees and Expenses.
-------------------------
The Lessee agrees to pay or cause to be paid (a) all reasonable
out-of-pocket expenses of the Lessor (including without limitation reasonable
counsel fees and expenses) incurred in connection with the transactions
contemplated hereby and by the other Operative Agreements (b) all reasonable
out-of-pocket costs and expenses incurred by the Credit Parties, the Agent, the
Primary Financing Parties or the Lessor in entering into any Lease Supplement
and any future amendments, modifications, supplements, restatements and/or
replacements with respect to any of the Operative Agreements, whether or not
such Lease Supplement, amendments, modifications, supplements, restatements
and/or replacements are ultimately entered into, or giving or withholding of
waivers or consents hereto or thereto, which have been requested by any Credit
Party, (c) all reasonable out-of-pocket costs and expenses incurred by the
Credit Parties, the Agent, the Primary Financing Parties or the Lessor in
connection with any exercise of remedies under any Operative Agreement or any
purchase of the Property pursuant to the terms of the Operative Agreements by
the Construction Agent, the Lessee or its designee and (d) all reasonable
out-of-pocket costs and expenses incurred by the Credit Parties, the Agent, any
Primary Financing Party or the Lessor in connection with any transfer or
conveyance of the Property to the Lessee or its designee or any third party
pursuant to the terms of the Operative Agreements, whether or not such transfer
or conveyance is ultimately accomplished, but in all cases excluding the fees,
expenses and disbursements of counsel for any individual Tranche A Note
Purchaser.
7.4. [Reserved].
----------
7.5. Administrative Fee.
------------------
The Lessee shall pay or cause to paid an administrative fee to the
Agent (for its individual account) in the amount of $60,000.00 per year (or such
other amount as may be agreed upon by the Lessee and the Agent from time to
time) which shall be paid on the Closing Date and each annual anniversary
thereof and such amount shall be deemed to be earned in full by the Agent as of
such Closing Date or annual anniversary thereof, as applicable.
31
SECTION 8. OTHER COVENANTS AND AGREEMENTS.
8.1. Cooperation with the Construction Agent or the Lessee.
-----------------------------------------------------
The Primary Financing Parties, the Lessor and the Agent shall, at the
expense of and to the extent reasonably requested by the Construction Agent or
the Lessee (but without assuming additional liabilities on account thereof and
only to the extent such is acceptable to the Primary Financing Parties, the
Lessor and/or the Agent, as applicable, in their reasonable discretion),
cooperate with the Construction Agent or the Lessee in connection with the
Construction Agent or the Lessee satisfying its covenant obligations contained
in the Operative Agreements including without limitation at any time and from
time to time, promptly and duly executing and delivering any and all such
further instruments, documents and financing statements (and continuation
statements related thereto).
8.2. Covenants of the Lessor.
-----------------------
The Lessor hereby agrees that so long as this Agreement is in effect:
(a) The Lessor will not create or permit to exist at any time,
and it will, at its own cost and expense, promptly take such action as
may be necessary duly to discharge, or to cause to be discharged, all
Lessor Liens on the Property;
(b) [Reserved];
(c) The Lessor shall not (i) commence any case, proceeding or
other action under any existing or future law of any jurisdiction,
domestic or foreign, relating to bankruptcy, insolvency,
reorganization, arrangement, winding-up, liquidation, dissolution,
composition or other relief with respect to it or its debts, or (ii)
seek appointment of a receiver, trustee, custodian or other similar
official for all or any substantial benefit of the creditors of the
Lessor; and the Lessor shall not 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;
(d) The Lessor shall give prompt written notice to the Lessee,
the Primary Financing Parties and the Agent if the Lessor's principal
place of business or chief executive office, or the office where the
records concerning the accounts or contract rights relating to the
Property are kept, shall cease to be located at One First Union Center,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇; and
(e) The Lessor shall take or refrain from taking such actions
and grant or refrain from granting such approvals with respect to the
Operative Agreements and/or relating to the Property in each case as
directed in writing by the Agent or, in connection with Section 8.5
hereof, the Lessee; provided, however, that notwithstanding the
-------- -------
foregoing provisions of this subparagraph (e) the Lessor, the Agent and
the Primary Financing Parties each acknowledge, covenant and agree that
neither the Lessor nor the
32
Agent shall act or refrain from acting except in accordance with the
provisions of the Intercreditor Agreement; provided, further, that each
-------- -------
of the Agent, the Primary Financing Parties and the Lessee
acknowledges, covenants and agrees that it will not instruct the Lessor
to take any action in violation of the terms of any Operative
Agreement.
8.3. Credit Party Covenants, Consent and Acknowledgment.
--------------------------------------------------
(a) Each Credit Party acknowledges and agrees that the
Borrower, pursuant to the terms and conditions of the Security
Agreement and the Mortgage Instruments, shall create Liens respecting
the various personal property, fixtures and real property described
therein in favor of the Agent. Each Credit Party hereby irrevocably
consents to the creation, perfection (subject to the terms of Section
8.12) and maintenance of such Liens. Each Credit Party shall, to the
extent reasonably requested by any of the other parties hereto,
cooperate with the other parties in connection with their covenants
herein or in the other Operative Agreements and shall from time to time
duly execute and deliver any and all such future instruments, documents
and financing statements (and continuation statements related thereto)
as any other party hereto may reasonably request.
(b) The Lessor hereby instructs each Credit Party, and each
Credit Party hereby acknowledges and agrees, that until such time as
the Notes are paid in full and the Liens evidenced by the Security
Agreement and the Mortgage Instruments have been released (i) any and
all Rent (excluding Excepted Payments) and any and all other amounts of
any kind or type under any of the Operative Agreements due and owing or
payable to any Person shall instead be paid directly to the Agent
(excluding Excepted Payments) or as the Agent may direct from time to
time for allocation and distribution in accordance with the procedures
set forth in Section 8.7 hereof, (ii) all rights of the Lessor under
the Lease shall be exercised by the Agent and (iii) each Credit Party
shall cause all notices, certificates, financial statements,
communications and other information which are delivered, or are
required to be delivered, to the Lessor, to be delivered to the Agent,
as Lessor's agent.
(c) No Credit Party shall consent to any amendment, supplement
or other modification of the terms or provisions of any Operative
Agreement to which it is a party except in accordance with Section 12.4
of this Agreement.
(d) Each Credit Party hereby covenants and agrees that, except
for amounts payable as Basic Rent (including without limitation
principal and interest due and owing under the Notes), amounts
specifically excluded from indemnification by the Lessee pursuant to
Sections 11.1 and 11.2 and amounts due and owing or otherwise payable
or incurred as a result of or in connection with any sale of an
assignment or participation interest by any Tranche B Lender or Tranche
A Note Purchaser, and payment obligations of one Financing Party to
another Financing Party, any and all payment obligations owing from
time to time under the Operative Agreements by any Person to the Agent,
the Lessor, the Escrow Agent, any Primary Financing Party or any other
Person shall (without further action) be deemed to be Supplemental Rent
obligations payable by the Lessee and guaranteed by the Guarantor
(provided, unless such obligation is expressly
33
stated as an obligation of the Lessee, the Lessee shall only be
responsible for such obligation to the extent it is reasonable for a
lessee to bear responsibility for such obligation in a transaction of
the type evidenced by the Operative Agreements); provided, however,
-------- -------
during the period prior to the Completion Date, the Construction Agent
may submit a Requisition for such Supplemental Rent obligations and
such Supplemental Rent obligations shall be payable by the Construction
Agent with the proceeds of one or more Advances made in accordance with
the provisions of the Operative Agreements and upon satisfaction or
express waiver of the conditions applicable to such Advance, and such
amounts shall be added to the Property Cost respecting the Property;
provided, further, in the event the Construction Agent shall fail to
-------- -------
comply with the requirements set forth in the immediately preceding
proviso or shall fail to submit a Requisition for such Supplemental
Rent obligations, the Construction Agent shall pay such Supplemental
Rent obligation to such Person from its own funds. Without limitation,
such Supplemental Rent obligations of the Credit Parties shall include
any amounts payable by the Lessor pursuant to Section 5.15,
administrative fees, breakage costs, indemnities, other reasonable fees
and transaction expenses incurred by the parties hereto in connection
with the transactions contemplated by the Operative Agreements.
(e) The Lessee hereby covenants and agrees to cause an
Appraisal or reappraisal (in form and substance reasonably satisfactory
to the Agent and from an appraiser selected by the Agent) to be issued
respecting the Property as requested by the Agent from time to time (i)
at each and every time as such shall be required to satisfy any
regulatory requirements imposed on the Agent, the Lessor and/or any
Primary Financing Party and (ii) after the occurrence of a Lease Event
of Default.
(f) [Reserved].
(g) At any time the Lessor or the Agent is entitled under the
Operative Agreements to possession of the Property or any component
thereof, each of the Construction Agent and the Lessee hereby covenants
and agrees, at its own cost and expense, to assemble and make the same
available to the Agent (on behalf of the Lessor).
(h) The Lessee hereby covenants and agrees that Equipment
(exclusive of any Fixtures) respecting the Property shall at no time
constitute in excess of ten percent (10%) of the aggregate Advances
respecting the Property funded at such time under the Operative
Agreements.
(i) [Reserved].
(j) The Lessee hereby covenants and agrees that it shall give
prompt notice to the Agent if the Lessee's principal place of business
or chief executive office, or the office where the records concerning
the accounts or contract rights relating to the Property are kept,
shall cease to be located at the locations set forth in Section 6.2(i)
or if it shall change its name.
(k) [Reserved].
34
(l) [Reserved].
(m) The Lessee hereby covenants and agrees that the rights of
the Lessee under this Agreement and the Lease shall not impair or in
any way diminish the obligations of the Construction Agent and/or the
rights of the Lessor under the Agency Agreement.
(n) [Reserved].
(o) Lessee shall promptly notify the Agent and each Primary
Financing Party, or cause the Agent and each Primary Financing Party to
be promptly notified, upon a Responsible Officer of such Lessee gaining
knowledge of the occurrence of any Lease Default or Lease Event of
Default which is continuing at such time and describing the same in
reasonable detail with a description of the action the Lessee or any
Affiliate has taken or proposes to take with respect thereto. In any
event, such notice shall be provided to the Agent within five (5)
Business Days of when a Responsible Officer of Lessee gains such
knowledge.
(p) Until all of the obligations under the Operative
Agreements have been finally and indefeasibly paid and satisfied in
full and the Commitments terminated, unless consent has been obtained
from the Majority Secured Parties and the Lessor, the Lessee will:
(i) preserve and maintain its separate legal
existence and, except where failure to do so could reasonably
be expected to have a Material Adverse Effect, all rights,
franchises, licenses, certifications, accreditations and
privileges necessary to the conduct of its business, and
qualify and remain qualified as a foreign corporation and
authorized to do business in Virginia and each other
jurisdiction in which the failure to so qualify could
reasonably be expected to have a Material Adverse Effect;
(ii) pay and perform all obligations of the Lessee
under the Operative Agreements and pay and perform (A) all
taxes, assessments and other governmental charges that may be
levied or assessed upon it or any of its property, and (B) all
other indebtedness, obligations and liabilities in accordance
with customary trade practices, which, in the case of (A) or
(B), if not paid could reasonably be expected to have a
Material Adverse Effect; provided that the Lessee may contest
--------
any item described in this Section 8.3(p)(ii) in good faith so
long as adequate reserves are maintained with respect thereto
in accordance with GAAP; and
(iii) to the extent failure to do so could
reasonably be expected to have a Material Adverse Effect,
observe and remain in compliance with all applicable Laws and
maintain in full force and effect all Governmental Actions, in
each case applicable to the conduct of its business; and,
subject to Section 14.4 of the Lease,
35
not permit the termination of any insurance reimbursement
program available to the Property.
(q) [Reserved].
(r) Lessee shall perform any and all obligations of Lessor
under, and cause Lessor to otherwise remain in full compliance with,
the terms and provisions of the Ground Lease.
(s) Promptly after obtaining any required architectural
approvals by any business park or any other applicable entity with
oversight responsibility for the applicable Improvements, the
Construction Agent shall deliver to the Agent copies of the same.
(t) Except as otherwise contemplated by the Operative
Agreements, the Construction Agent shall not use the proceeds of any
Advance for any purpose other than the lease of the Property, the
acquisition, installation and testing of the Equipment, the
construction of Improvements and the payment of interest, Transaction
Expenses and the fees, expenses and other disbursements by the Lessee
or the Lessor referenced in any Operative Agreement, and other Project
Costs, in each case which accrue prior to the Rent Commencement Date
with respect to the Property.
(u) The Plans and Specifications for the Property will be
prepared prior to the commencement of construction 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,
individually or in the aggregate, shall not have and could not
reasonably be expected to have a Material Adverse Effect. Upon
completion of the Improvements for the Property in accordance with the
applicable Plans and Specifications, such Improvements will be within
any building restriction lines and will not encroach in any manner onto
any adjoining land (except as permitted by express written easements,
which have been approved by the Agent).
(v) The Property shall be improved in all material respects in
accordance with the applicable Plans and Specifications in a good and
workmanlike manner and shall be operational.
(w) The Lessee shall deliver (or cause to be delivered) an
annual certificate evidencing the insurance required to be maintained
by the Lessee under Article XIV of the Lease on the date such
certificate is due thereunder.
(x) The Property shall comply in all material respects with
all Insurance Requirements and all standards of Lessee with respect to
similar properties owned by Lessee and the other Credit Parties.
36
(y) The Property shall comply 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, individually or in the aggregate, shall not have and could
not reasonably be expected to have a Material Adverse Effect.
(z) All utility services and facilities necessary for the
construction and operation of the Improvements and the installation and
operation of the Equipment regarding the Property (including without
limitation gas, electrical, water and sewage services and facilities)
shall be available at the applicable Land or shall be constructed prior
to the Completion Date for the Property.
(aa) The acquisition, installation and testing of the
Equipment (if any) and construction of the Improvements (if any) shall
be performed in a good and workmanlike manner, substantially in
accordance with the applicable Plans and Specifications.
(bb) Upon recordation of a memorandum of the Ground Lease and
the Mortgage Instruments in the real estate recording office in the
applicable Approved State identified by the Construction Agent or the
Lessee, (x) the Lien created by the Tranche B Mortgage Instruments in
the real property described therein shall be a perfected first priority
mortgage Lien on the leasehold estate under the Ground Lease in favor
of the Agent, for the benefit of the Tranche B Lenders and (y) the Lien
created by the Tranche A Mortgage Instruments in the real property
described therein shall be a perfected second priority mortgage Lien
(subject to the Lien created by the Tranche B Mortgage Instruments) on
the leasehold estate under the Ground Lease in favor of the Agent, for
the benefit of the Tranche A Note Purchasers. To the extent that the
security interests in the portion of the Collateral comprised of
personal property can be perfected by filing in the filing offices in
the applicable Approved States or elsewhere identified by the
Construction Agent or the Lessee, upon filing of the Primary Financing
Party Financing Statements in such filing offices, the security
interests created by the Security Agreement shall be perfected first
priority security interests in such personal property in favor of the
Agent, for the ratable benefit of the Secured Parties.
(cc) Upon recordation of the memorandum of the Lease Agreement
and the memorandum of a Ground Lease (or, in either case, a short form
lease) in the real estate recording office in the applicable Approved
State identified by the Construction Agent or the Lessee, the Lien
created by the Lease Agreement in the real property described therein
shall be a perfected first priority mortgage Lien on the leasehold
estate under the Ground Lease in favor of the Agent, for the benefit of
the Secured Parties. To the extent that the security interests in the
portion of the Property comprised of personal property can be perfected
by the filing in the filing offices in the applicable Approved State or
elsewhere identified by the Construction Agent or the Lessee, upon
filing of the Lessor Financing Statements in such filing offices, the
security interests created by the Lease Agreement shall be perfected
first priority security interests in such personal property in favor of
the Lessor, which rights pursuant to the Lessor Financing Statements
are assigned to the Agent, for the benefit of the Secured Parties.
37
(dd) Lessee shall not incur or suffer to exist any Lien on the
Property other than Permitted Liens and as otherwise permitted under
Section 8.5.
(ee) Lessee shall deliver a written notice to Agent and the
Lessor promptly upon Lessee's receiving notice or actual knowledge of a
Responsible Officer of Lessee of the taking by a Governmental Authority
of an action which would constitute a Condemnation, receiving notice of
a material violation of any Legal Requirement on or at the Property,
including any Environmental Law, under which liability may be imposed
upon Lessor, Agent, any Primary Financing Party or Lessee, or receiving
notice or actual knowledge of modification of the Property (other than
routine construction progress, fire, life-safety and similar
inspections) for any violation of Lessor under which criminal liability
may be imposed upon Agent, any Primary Financing Party or Lessee.
(ff) Lessee shall not, nor shall it permit anyone authorized
to act on its behalf to, take any action which would subject the
Property, the Operative Agreements, the issuance or sale of the Notes,
or any security or lease the offering of which, for purposes of the
Securities Act or any state securities laws, would be deemed to be part
of the same offering of the aforementioned items, to the registration
requirements of Section 5 of the Securities Act or any state securities
laws.
(gg) Not less than two (2) Business Days prior to any
prepayment of any Tranche A Note, the Lessee (on behalf of the Lessor)
shall deliver to each affected holder of one or more Tranche A Notes a
certificate of a Responsible Officer specifying the calculation of such
Make-Whole Amount as of the specified prepayment date.
(hh) Without the consent of the Agent, neither COB nor FSB
will change its legal name or use, or transact any business under, any
trade name other than its legal name.
(ii) The Lessee agrees that in the event neither S&P nor
▇▇▇▇▇'▇ provides a rating of either of COB or FSB, the Lessee shall
cause one of the Rating Agencies to issue and maintain at all times a
"private letter" rating for COB or FSB, as the case may be, and to
submit to such Rating Agency the materials and information necessary
for, and a request for, a new "private letter" rating every six (6)
months thereafter and upon the occurrence of any merger or other event
described in Section 5.15(a) of the Participation Agreement. The Lessee
further agrees to provide each of the Tranche A Note Purchasers a copy
of such "private letter" rating and will permit and allow such Tranche
A Note Purchasers to discuss such rating with the Rating Agency.
(jj) The Construction Agent shall deliver (i) evidence of
builder's risk insurance in compliance with the requirements set forth
in Section 2.6(f) of the Agency Agreement and (ii) a certificate of the
Insurance Consultant on or before February 1, 2001 and every three (3)
year anniversary thereof, certifying as to compliance by the
Construction Agent with the requirements of Article XIV of the Lease
and otherwise in form and substance reasonably satisfactory to the
Agent.
38
(kk) The Construction Agent shall deliver to the Lessor, the
Agent and the Primary Financing Parties the Maximum Guaranty Price
Contract in substantially the form approved by the Agent, the Lessor
and the Primary Financing Parties on the Closing Date or otherwise in
form reasonably acceptable to the Agent, together with a consent to the
assignment thereof executed by the Contractor thereunder, no less than
five (5) Business Days prior to the scheduled date for the initial
Construction Advance for payment of Hard Costs.
(ll) The Lessee will not amend the Repurchase Right (as
defined in that certain Real Estate Purchase Agreement dated as of
September 27, 2000 (as amended by that certain First Amendment to Real
Estate Purchase Agreement dated as of December 4, 2000) between COFC
and West*Group Properties LLC, the interest of COFC in which has been
assigned to COB pursuant to that certain Assignment and Assumption of
Real Estate Purchase Agreement dated as of December 5, 2000 by and
between COFC and COB) without the written consent of the Agent.
8.3A Additional Affirmative Covenants of FSB.
---------------------------------------
FSB covenants that commencing on the Closing Date and thereafter so
long as any of the Company Obligations are unpaid:
8.3A.1 Financial and Business Information.
----------------------------------
FSB shall deliver or cause to be delivered or otherwise make
available through electronic media (provided that FSB shall give prior
--------
written notice to the Agent and each Primary Financing Party of such
availability) to each of the Agent and the Primary Financing Parties:
(a) (i) as soon as available and in any event within
60 days after the end of each of the first three quarterly
fiscal periods of each fiscal year of Parent, consolidated
statements of income, changes in stockholders' equity and cash
flows of Parent and its Subsidiaries for such period (with
respect to statements of income only) and for the period from
the beginning of the respective fiscal year to the end of such
period, and the related consolidated balance sheet of Parent
and its Subsidiaries as at the end of such period, setting
forth in each case in comparative form the corresponding
consolidated figures for the corresponding periods in the
preceding fiscal year (except that, in the case of balance
sheets, such comparison shall be to the last day of the prior
fiscal year) and (ii) as soon as available and in any event
within 120 days after the end of each fiscal year of Parent,
consolidated statements of income, changes in stockholders'
equity and cash flows of Parent and its Subsidiaries for such
fiscal year and the related consolidated and consolidating
balance sheets of Parent and its Subsidiaries as at the end of
such fiscal year, setting forth in each case in comparative
form the corresponding consolidated figures as of the end of
and for the preceding fiscal year, and accompanied by an
opinion thereon of independent certified public accountants of
recognized national standing, which opinion shall state that
said financial
39
statements present fairly, in all material respects, the
consolidated financial condition and results of operations and
cash flows of Parent and its Subsidiaries as at the end of,
and for, such fiscal year in accordance with GAAP;
(b) as soon as available and in any event within 120
days after the end of each fiscal year of FSB, consolidated
statements of income, changes in stockholders' equity and cash
flows of FSB and its Subsidiaries for such fiscal year and the
related consolidated and consolidating balance sheets of FSB
and its Subsidiaries as at the end of such fiscal year,
setting forth in each case in comparative form the
corresponding consolidated figures as of the end of and for
the preceding fiscal year, accompanied by a certificate of a
senior financial officer of FSB, which certificate shall state
that said financial statements present fairly, in all material
respects, the consolidated financial condition and results of
operations and cash flows of FSB and its Subsidiaries as at
the end of, and for, such fiscal year in accordance with GAAP;
(c) as soon as available and in any event within 60
days after the end of each quarterly fiscal period of each
fiscal year of FSB, the "Thrift Financial Report" for FSB and
its Insured Subsidiaries, all prepared in accordance with
regulatory accounting principles prescribed by the Federal
Financial Institutions Examination Counsel;
(d) promptly upon their becoming available, copies of
all registration statements (excluding exhibits to such
registration statements, and other than registration
statements filed on Form S-8 or any successor form) and
regular periodic reports filed on Form 10-K, Form 10-Q or Form
8-K (or any successor form), if any, that FSB or any of its
Affiliates shall have filed with the SEC or any national
securities exchange;
(e) promptly upon the mailing thereof to the
shareholders of Parent generally, copies of all financial
statements, reports and proxy statements so mailed;
(f) as soon as possible, and in any event within ten
days after FSB knows or has reason to believe that any of the
events or conditions specified below with respect to any Plan
or Multiemployer Plan has occurred or exists, a statement
signed by a senior financial officer of FSB setting forth
details respecting such event or condition and the action, if
any, that FSB or its ERISA Affiliate proposes to take with
respect thereto (and a copy of any report or notice required
to be filed with or given to the PBGC by FSB or an ERISA
Affiliate with respect to such event or condition, except that
a copy of any notice required to be filed for an event
described in subparagraph (i) below may be provided at a later
date (to be no later than the date such notice is filed) if it
has not been filed as of the date of the signed statement
described above):
(i) any reportable event, as defined in Section
4043(c) of
40
ERISA and the regulations issued thereunder, with
respect to a Plan, as to which the requirement to
provide 30 days' notice to the PBGC under Section
4043(a) or Section 4043(b) of ERISA applies, other
than a reportable event for which the requirement to
provide such notice has been waived by regulation or
for which the PBGC has announced in Technical Update
95-3 (or any subsequent administrative guideline)
that it will not apply a penalty for failure to
provide such notice (provided that a failure to meet
--------
the minimum funding standard of Section 412 of the
Code or Section 302 of ERISA, including, without
limitation, the failure to make on or before its due
date a required installment under Section 412(m) of
the Code or Section 302(e) of ERISA, shall be a
reportable event regardless of the issuance of any
waivers in accordance with Section 412(d) of the
Code); and any request for a waiver under Section
412(d) of the Code for any Plan;
(ii) the distribution under Section 4041(c)
of ERISA of a notice of intent to terminate any Plan
or any action taken by FSB or an ERISA Affiliate to
terminate any Plan under Section 4041(c) of ERISA;
(iii) the institution by the PBGC of
proceedings under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to
administer, any Plan, or the receipt by FSB or any
ERISA Affiliate of a notice from a Multiemployer Plan
that such action has been taken by the PBGC with
respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal from
a Multiemployer Plan by FSB or any ERISA Affiliate
that results in liability under Section 4201 or 4204
of ERISA (including the obligation to satisfy
secondary liability as a result of a purchaser
default) or the receipt by FSB or any ERISA Affiliate
of notice from a Multiemployer Plan that it is in
reorganization or insolvency pursuant to Section 4241
or 4245 of ERISA or that it intends to terminate or
has terminated under Section 4041A of ERISA;
(v) the institution of a proceeding by a
fiduciary of any Multiemployer Plan against FSB or
any ERISA Affiliate to enforce Section 515 of ERISA,
which proceeding is not dismissed within 30 days; and
(vi) the adoption of an amendment to any
Plan that, pursuant to Section 401(a)(29) of the Code
or Section 307 of ERISA, would result in the loss of
tax-exempt status of the trust of which such Plan is
a part if FSB or an ERISA Affiliate fails to timely
provide security to such Plan in accordance with the
provisions of said Sections;
(g) [Reserved].
--------
41
(h) promptly (and in no event more than five (5)
days) after a Responsible Officer of FSB obtains knowledge
thereof, a notice describing any change in its Debt Rating
assigned by any Rating Agency has occurred, or a notice that
FSB has been placed on any watch list by a Rating Agency;
(i) at the time any set of financial statements is
furnished pursuant to paragraph (b) or (c) above, a
certificate of a Responsible Officer of FSB (i) to the effect
that no Lease Default has occurred and is continuing (or, if
any Lease Default has occurred and is continuing, describing
the same in reasonable detail and describing the action that
FSB or an Affiliate has taken or proposes to take with respect
thereto) and (ii) setting forth in reasonable detail
(including, without limitation, as to the component parts of
relevant definitions of accounting terms included in Section 5
hereof) the computations necessary to determine whether FSB is
in compliance with its obligations under Sections 8.3B.1 and
8.3B.2 hereof as of the end of the respective quarterly fiscal
period or fiscal year; and
(j) from time to time such other information
regarding the financial condition, operations, business or
prospects of FSB or any of its Subsidiaries as any Financing
Party may reasonably request, including without limitation,
such information as is required by Rule 144A to be delivered
to a prospective transferee of a Tranche A Note.
8.3A.2 Inspection.
----------
FSB shall permit the representatives of each Financing Party,
during normal business hours, to examine, copy and make extracts from
its books and records, to inspect any of its properties, and to discuss
its business and affairs with its officers, all to the extent
reasonably requested by such Financing Party; provided that FSB shall
--------
not be required to provide (i) the names of, or other information that
could be used to identify, account holders, (ii) any proprietary
strategic insights or statistical models concerning account holders or
potential account holders, (iii) information regarding the specific
nature or application of any of the information-based strategies
employed by FSB and its Subsidiaries in the conduct of their business
or (iv) any proprietary plans or other proprietary information relating
to the development of the business of FSB and its Subsidiaries.
8.3A.3 Compliance with Law.
-------------------
Without limiting the requirements of the Lease, FSB will and
will cause each of its Subsidiaries to comply with the requirements of
all applicable laws, rules, regulations and orders of governmental or
regulatory authorities (including, without limitation, ERISA, all
Environmental Laws and the FDIA and all rules and regulations
promulgated thereunder) if failure to comply with such requirements
could (either individually or in the aggregate) have a Material Adverse
Effect.
42
8.3A.4 Insurance.
---------
Without limiting the requirements of the Lease, FSB will and
will cause each of its Subsidiaries to, maintain (either in its own
name or in the name of an Affiliate) with financially sound and
responsible insurance companies, insurance on all their respective
properties in at least such amounts and against at least such risks
(and with such risk retention) as are usually insured against in the
same general area by companies of established repute engaged in the
same or a similar business; and will furnish to the Primary Financing
Parties, upon request from the Agent, information presented in
reasonable detail as to the insurance so carried.
8.3A.5 Maintenance of Properties.
-------------------------
Without limiting the requirements of the Lease, FSB will and
will cause each of its Subsidiaries to maintain all of its properties
used or useful in its business in good working order and condition
ordinary wear and tear excepted, except to the extent that the failure
to maintain any such property in good working order and condition would
not (either individually or in the aggregate) have a Material Adverse
Effect.
8.3A.6 Payment of Taxes and Claims.
---------------------------
FSB will and will cause each of its Subsidiaries to pay and
discharge all taxes, assessments and governmental charges or levies
imposed on it or on its income or profits or on any of its property
prior to the date on which penalties attach thereto, except for any
such tax, assessment, charge or levy the payment of which is being
contested in good faith and by proper proceedings and against which
adequate reserves are being maintained in accordance with GAAP.
8.3A.7 Corporate Existence, etc.
------------------------
FSB will at all times preserve and maintain its legal
existence and all of its rights, privileges, licenses and franchises
necessary or desirable in the normal conduct of its business (provided
--------
that nothing in this Section 8.3A.7 shall prohibit any transaction
expressly permitted under Section 8.3B.3 hereof).
8.3A.8 Litigation.
----------
FSB will promptly give to each Primary Financing Party notice
of all legal or arbitral proceedings, and of all investigations or
proceedings by or before any governmental or regulatory authority or
agency, and any material development in respect of such legal or other
proceedings, against or affecting FSB or any of its Subsidiaries,
except investigations or proceedings (a) as to which there is no
reasonable possibility of an adverse determination or (b) that, if
adversely determined, would not (either individually or in the
aggregate) have a Material Adverse Effect.
43
8.3B Additional Negative Covenants of FSB.
------------------------------------
FSB covenants that commencing on the Closing Date and thereafter so
long as any of the Company Obligations are unpaid:
8.3B.1 Delinquency Ratio.
-----------------
FSB will not permit its Delinquency Ratio on the last day of
any calendar month to exceed 6.0%.
8.3B.2 Other Financial Conditions.
--------------------------
FSB will not on any date permit
(a) its Tier 1 Capital to Managed Receivables
Ratio to be less than 4.0%, provided that such Tier 1 Capital
to Managed Receivables Ratio may be less than 4.0% during any
period of 90 consecutive days so long as (i) on the last day
of the fiscal quarter ending on or immediately prior to the
first day of such 90-day period, such Tier 1 Capital to
Managed Receivables Ratio was not less than 4.0% and (ii) at
no time during such 90-day period is such Tier 1 Capital to
Managed Receivables Ratio is less than 3.5%;
(b) its Leverage Ratio to exceed 10.0 to 1;
(c) its Tier 1 Capital to Risk Adjusted Assets
Ratio to be less than 6.0%;
(d) its Total Capital to Risk Adjusted Assets
Ratio to be less than 10.0%; or
(e) its Tangible Net Worth to be less than
$192,685,600.
(f) its Total Capital to be less than that
necessary to be "adequately-capitalized", within the meaning
of such term under the Prompt Corrective Action provisions
contained in the FDIA (12 U.S.C. (S).1831(o)) (or any
successor provision), as amended, re-enacted or redesignated
from time to time.
8.3B.3 Merger, Consolidation, etc.
--------------------------
FSB will not: (a) enter into any transaction of merger or
consolidation or amalgamation, or liquidate, wind up or dissolve itself
(or suffer any liquidation or dissolution); or (b) convey, sell, lease,
transfer or otherwise dispose of, in one transaction or a series of
transactions (a "Transfer"), all or substantially all of its business
--------
or property; provided that FSB may be merged or consolidated with or
--------
into, or Transfer all or substantially all of its business or property
to, any Person if (1) the continuing, surviving or transferee
corporation assumes all of FSB's obligations hereunder and under
44
the other Operative Agreements to which it is a party, (2) either: (i)
the continuing, surviving or transferee corporation is an Affiliate of
FSB or (ii) the continuing, surviving or transferee corporation has a
Tangible Net Worth equal to or greater than the Tangible Net Worth of
FSB immediately prior to giving effect to such merger, consolidation or
Transfer, (3) FSB has delivered to the Agent a legal opinion as to
enforceability from counsel reasonably acceptable to the Agent and in
form and substance reasonably acceptable to the Agent, and (4) no Lease
Default or Lease Event of Default shall have occurred and be continuing
after such Transfer.
No such merger, consolidation or Transfer shall have the
effect of releasing FSB or any successor corporation that shall
theretofore have become such in the manner prescribed in this Section
8.3B.3 from its liability under any of the Operative Agreements.
Nothing in this Section 8.3B.3 shall prohibit FSB or any of its
Subsidiaries from the sale of credit card loans and other finance
receivables pursuant to securitizations.
8.3B.4 Lines of Business.
-----------------
FSB will not, nor will it permit any of its Subsidiaries to,
engage to any extent in any line or lines of business activity other
than as permitted by its charter.
8.3C Additional Affirmative Covenants of COB.
---------------------------------------
COB covenants that commencing on the Closing Date and thereafter so
long as any of the Company Obligations are unpaid:
8.3C.1 Financial and Business Information.
----------------------------------
COB shall deliver or cause to be delivered or otherwise make
available through electronic media (provided that COB shall give prior
--------
written notice to the Agent and each Primary Financing Party of such
availability) to each of the Agent and the Primary Financing Parties:
(a) (i) as soon as available and in any event within
60 days after the end of each of the first three quarterly
fiscal periods of each fiscal year of Parent, consolidated
statements of income, changes in stockholders' equity and cash
flows of Parent and its Subsidiaries for such period (with
respect to statements of income only) and for the period from
the beginning of the respective fiscal year to the end of such
period, and the related consolidated balance sheet of Parent
and its Subsidiaries as at the end of such period, setting
forth in each case in comparative form the corresponding
consolidated figures for the corresponding periods in the
preceding fiscal year (except that, in the case of balance
sheets, such comparison shall be to the last day of the prior
fiscal year) and (ii) as soon as available and in any event
within 120 days after the end of each fiscal year of Parent,
consolidated statements of income, changes in stockholders'
equity and cash flows of Parent and its Subsidiaries for such
fiscal year and the related consolidated and
45
consolidating balance sheets of Parent and its Subsidiaries as
at the end of such fiscal year, setting forth in each case in
comparative form the corresponding consolidated figures as of
the end of and for the preceding fiscal year, and accompanied
by an opinion thereon of independent certified public
accountants of recognized national standing, which opinion
shall state that said financial statements present fairly, in
all material respects, the consolidated financial condition
and results of operations and cash flows of Parent and its
Subsidiaries as at the end of, and for, such fiscal year in
accordance with GAAP;
(b) as soon as available and in any event within 120
days after the end of each fiscal year of COB, consolidated
statements of income, changes in stockholders' equity and cash
flows of COB and its Subsidiaries for such fiscal year and the
related consolidated and consolidating balance sheets of COB
and its Subsidiaries as at the end of such fiscal year,
setting forth in each case in comparative form the
corresponding consolidated figures as of the end of and for
the preceding fiscal year, accompanied by a certificate of a
senior financial officer of COB, which certificate shall state
that said financial statements present fairly, in all material
respects, the consolidated financial condition and results of
operations and cash flows of COB and its Subsidiaries as at
the end of, and for, such fiscal year in accordance with GAAP;
(c) as soon as available and in any event within 60
days after the end of each quarterly fiscal period of each
fiscal year of COB, the "Consolidated Reports of Condition and
Income" for COB and its Insured Subsidiaries, all prepared in
accordance with regulatory accounting principles prescribed by
the Federal Financial Institutions Examination Counsel;
(d) promptly upon their becoming available, copies of
all registration statements (excluding exhibits to such
registration statements, and other than registration
statements filed on Form S-8 or any successor form) and
regular periodic reports filed on Form 10-K, Form 10-Q or Form
8-K (or any successor form), if any, that COB or any of its
Affiliates shall have filed with the SEC or any national
securities exchange;
(e) promptly upon the mailing thereof to the
shareholders of Parent generally, copies of all financial
statements, reports and proxy statements so mailed;
(f) as soon as possible, and in any event within ten
days after COB knows or has reason to believe that any of the
events or conditions specified below with respect to any Plan
or Multiemployer Plan has occurred or exists, a statement
signed by a senior financial officer of COB setting forth
details respecting such event or condition and the action, if
any, that COB or its ERISA Affiliate proposes to take with
respect thereto (and a copy of any report or notice required
to be filed with or given to the PBGC by COB or an ERISA
Affiliate with respect to such event or condition, except that
a copy of any notice required to be filed for an event
described in subparagraph (i) below may be provided at a
46
later date (to be no later than the date such notice is filed)
if it has not been filed as of the date of the signed
statement described above):
(i) any reportable event, as defined in
Section 4043(c) of ERISA and the regulations issued
thereunder, with respect to a Plan, as to which the
requirement to provide 30 days' notice to the PBGC
under Section 4043(a) or Section 4043(b) of ERISA
applies, other than a reportable event for which the
requirement to provide such notice has been waived by
regulation or for which the PBGC has announced in
Technical Update 95-3 (or any subsequent
administrative guideline) that it will not apply a
penalty for failure to provide such notice (provided
--------
that a failure to meet the minimum funding standard
of Section 412 of the Code or Section 302 of ERISA,
including, without limitation, the failure to make on
or before its due date a required installment under
Section 412(m) of the Code or Section 302(e) of
ERISA, shall be a reportable event regardless of the
issuance of any waivers in accordance with Section
412(d) of the Code); and any request for a waiver
under Section 412(d) of the Code for any Plan;
(ii) the distribution under Section 4041(c)
of ERISA of a notice of intent to terminate any Plan
or any action taken by COB or an ERISA Affiliate to
terminate any Plan under Section 4041(c) of ERISA;
(iii) the institution by the PBGC of
proceedings under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to
administer, any Plan, or the receipt by COB or any
ERISA Affiliate of a notice from a Multiemployer Plan
that such action has been taken by the PBGC with
respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal
from a Multiemployer Plan by COB or any ERISA
Affiliate that results in liability under Section
4201 or 4204 of ERISA (including the obligation to
satisfy secondary liability as a result of a
purchaser default) or the receipt by COB or any ERISA
Affiliate of notice from a Multiemployer Plan that it
is in reorganization or insolvency pursuant to
Section 4241 or 4245 of ERISA or that it intends to
terminate or has terminated under Section 4041A of
ERISA;
(v) the institution of a proceeding by a
fiduciary of any Multiemployer Plan against COB or
any ERISA Affiliate to enforce Section 515 of ERISA,
which proceeding is not dismissed within 30 days; and
(vi) the adoption of an amendment to any
Plan that, pursuant to Section 401(a)(29) of the Code
or Section 307 of ERISA, would result in the loss of
tax-exempt status of the trust of which such Plan is
a part if
47
COB or an ERISA Affiliate fails to timely provide
security to such Plan in accordance with the
provisions of said Sections;
(g) [Reserved].
--------
(h) promptly (and in no event more than five (5)
days) after a Responsible Officer of COB obtains knowledge
thereof, a notice describing any change in its Debt Rating
assigned by any Rating Agency has occurred, or a notice that
COB has been placed on any watch list by a Rating Agency;
(i) at the time any set of financial statements is
furnished pursuant to paragraph (b) or (c) above, a
certificate of a Responsible Officer of COB (i) to the effect
that no Lease Default has occurred and is continuing (or, if
any Lease Default has occurred and is continuing, describing
the same in reasonable detail and describing the action that
COB or an Affiliate has taken or proposes to take with respect
thereto) and (ii) setting forth in reasonable detail the
computations necessary to determine whether COB is in
compliance with its obligations under Sections 8.3D.1 and
8.3D.2 hereof as of the end of the respective quarterly fiscal
period or fiscal year; and
(j) from time to time such other information
regarding the financial condition, operations, business or
prospects of COB or any of its Subsidiaries as any Financing
Party may reasonably request, including without limitation,
such information as is required by Rule 144A to be delivered
to a prospective transferee of a Tranche A Note.
8.3C.2 Inspection.
----------
COB shall permit the representatives of each Financing Party,
during normal business hours, to examine, copy and make extracts from
its books and records, to inspect any of its properties, and to discuss
its business and affairs with its officers, all to the extent
reasonably requested by such Financing Party; provided that COB shall
--------
not be required to provide (i) the names of, or other information that
could be used to identify, account holders, (ii) any proprietary
strategic insights or statistical models concerning account holders or
potential account holders, (iii) information regarding the specific
nature or application of any of the information-based strategies
employed by COB and its Subsidiaries in the conduct of their business
or (iv) any proprietary plans or other proprietary information relating
to the development of the business of COB and its Subsidiaries.
8.3C.3 Compliance with Law.
-------------------
Without limiting the requirements of the Lease, COB will and
will cause each of its Subsidiaries to comply with the requirements of
all applicable laws, rules, regulations and orders of governmental or
regulatory authorities (including, without limitation, ERISA, all
Environmental Laws and the FDIA and all rules and regulations
promulgated
48
thereunder) if failure to comply with such requirements could (either
individually or in the aggregate) have a Material Adverse Effect.
8.3C.4 Insurance.
---------
Without limiting the requirements of the Lease, COB will and
will cause each of its Subsidiaries to, maintain (either in its own
name or in the name of an Affiliate) with financially sound and
responsible insurance companies, insurance on all their respective
properties in at least such amounts and against at least such risks
(and with such risk retention) as are usually insured against in the
same general area by companies of established repute engaged in the
same or a similar business; and will furnish to the Primary Financing
Parties, upon request from the Agent, information presented in
reasonable detail as to the insurance so carried.
8.3C.5 Maintenance of Properties.
-------------------------
Without limiting the requirements of the Lease, COB will and
will cause each of its Subsidiaries to maintain all of its properties
used or useful in its business in good working order and condition
ordinary wear and tear excepted, except to the extent that the failure
to maintain any such property in good working order and condition would
not (either individually or in the aggregate) have a Material Adverse
Effect.
8.3C.6 Payment of Taxes and Claims.
---------------------------
COB will and will cause each of its Subsidiaries to pay and
discharge all taxes, assessments and governmental charges or levies
imposed on it or on its income or profits or on any of its property
prior to the date on which penalties attach thereto, except for any
such tax, assessment, charge or levy the payment of which is being
contested in good faith and by proper proceedings and against which
adequate reserves are being maintained in accordance with GAAP.
8.3C.7 Corporate Existence, etc.
------------------------
COB will at all times preserve and maintain its legal
existence and all of its rights, privileges, licenses and franchises
necessary or desirable in the normal conduct of its business (provided
--------
that nothing in this Section 8.3C.7 shall prohibit any transaction
expressly permitted under Section 8.3D.3 hereof).
8.3C.8 Litigation.
----------
COB will promptly give to each Primary Financing Party notice
of all legal or arbitral proceedings, and of all investigations or
proceedings by or before any governmental or regulatory authority or
agency, and any material development in respect of such legal or other
proceedings, against or affecting COB or any of its Subsidiaries,
except investigations or proceedings (a) as to which there is no
reasonable possibility of
49
an adverse determination or (b) that, if adversely determined, would
not (either individually or in the aggregate) have a Material Adverse
Effect.
8.3D Additional Negative Covenants of COB.
------------------------------------
COB covenants that commencing on the Closing Date and thereafter so
long as any of the Company Obligations are unpaid:
8.3D.1 Delinquency Ratio.
-----------------
COB will not permit its Delinquency Ratio on the last day of
any calendar month to exceed 6.0%.
8.3D.2 Other Financial Conditions.
--------------------------
COB will not on any date permit
(a) its Tier 1 Capital to Managed Receivables
Ratio to be less than 4.0%, provided that such Tier 1 Capital
to Managed Receivables Ratio may be less than 4.0% during any
period of 90 consecutive days so long as (i) on the last day
of the fiscal quarter ending on or immediately prior to the
first day of such 90-day period, such Tier 1 Capital to
Managed Receivables Ratio was not less than 4.0% and (ii) at
no time during such 90-day period is such Tier 1 Capital to
Managed Receivables Ratio is less than 3.5%;
(b) its Leverage Ratio to exceed 10.0 to 1;
(c) its Tier 1 Capital to Risk Adjusted Assets
Ratio to be less than 6.0%;
(d) its Total Capital to Risk Adjusted Assets
Ratio to be less than 10.0%;
(e) its Tangible Net Worth to be less than
$828,588,000; or
(f) its Total Capital to be less than that
necessary to be "well-capitalized", within the meaning of such
term under the Prompt Corrective Action provisions contained
in the FDIA (12 U.S.C. ss.1831(o)) (or any successor
provision), as amended, re-enacted or redesignated from time
to time.
8.3D.3 Merger, Consolidation, etc.
--------------------------
COB will not: (a) enter into any transaction of merger or
consolidation or amalgamation, or liquidate, wind up or dissolve itself
(or suffer any liquidation or dissolution); or (b) convey, sell, lease,
transfer or otherwise dispose of, in one transaction or a series of
transactions (a "Transfer"), all or substantially all of its business
--------
or
50
property; provided that COB may be merged or consolidated with or
--------
into, or Transfer all or substantially all of its business or property
to, any Person if (1) the continuing, surviving or transferee
corporation assumes all of COB's obligations hereunder, (2) either: (i)
the continuing, surviving or transferee corporation is an Affiliate of
COB or (ii) the continuing, surviving or transferee corporation has a
Tangible Net Worth equal to or greater than the Tangible Net Worth of
COB immediately prior to giving effect to such merger, consolidation or
Transfer, (3) COB has delivered to the Agent a legal opinion as to
enforceability from counsel reasonably acceptable to the Agent and in
form and substance reasonably acceptable to the Agent, and (4) no Lease
Default or Lease Event of Default shall have occurred and be continuing
after such Transfer.
No such merger, consolidation or Transfer shall have the
effect of releasing COB or any successor corporation that shall
theretofore have become such in the manner prescribed in this Section
8.3D.3 from its liability under this Agreement or any other Operative
Agreement. Nothing in this Section 8.3D.3 shall prohibit COB or any of
its Subsidiaries from the sale of credit card loans and other finance
receivables pursuant to securitizations.
8.3D.4 Lines of Business.
-----------------
COB will not, nor will it permit any of its Subsidiaries to,
engage to any extent in any line or lines of business activity other
than as permitted by its charter and as necessary to conduct the
business of a limited purpose credit card bank.
8.4. Sharing of Certain Payments.
---------------------------
Except for Excepted Payments, the parties hereto acknowledge and agree
that all payments due and owing by any Credit Party to the Lessor under the
Lease or any of the other Operative Agreements shall be made by such Credit
Party directly to the Agent as more particularly provided in Section 8.3 hereof.
The Lessor, the Agent, the Primary Financing Parties and the Credit Parties
acknowledge the terms of Section 8.7 of this Agreement regarding the allocation
of payments and other amounts made or received from time to time under the
Operative Agreements and agree, that all such payments and amounts are to be
allocated as provided in Section 8.7 of this Agreement.
8.5. Grant of Easements, etc.
-----------------------
The Agent, the Primary Financing Parties and the Lessor hereby agree
that, so long as no Lease Event of Default shall have occurred and be
continuing, and until such time as the Agent gives instructions to the contrary
to the Lessor after the occurrence and continuance of such Lease Event of
Default, the Lessor shall, without the consent of the Agent or the Primary
Financing Parties, 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 with respect to
the Property, (ii) release existing easements or other rights which are for the
benefit of the Property, (iii) execute and deliver to any Person any instrument
appropriate to confirm or effect such grants or releases, and (iv)
51
execute and deliver to any Person such other documents or materials in
connection with the acquisition, development, construction, testing, demolition
or operation of the Property, including without limitation reciprocal easement
agreements, construction contracts, operating agreements, development
agreements, plats, replats or subdivision documents; provided, that each of the
--------
agreements referred to in this Section 8.5 shall be on commercially reasonable
terms so as not to diminish the value of the Property in any material respect or
otherwise have a Material Adverse Effect.
8.6. Appointment of the Agent by the Primary Financing Parties and
-------------------------------------------------------------
the Lessor.
----------
(a) The Secured Parties acknowledge and agree and direct that
the rights and remedies of the beneficiaries of the Lien of the
Security Documents shall be exercised by the Agent on behalf of the
Secured Parties in accordance with the provisions of the Intercreditor
Agreement; provided, in all cases, the Agent shall allocate payments
--------
and other amounts received in accordance with Section 8.7. The Agent is
further appointed to provide notices under the Operative Agreements on
behalf of the Lessor and each Primary Financing Party (as determined by
the Agent, in its reasonable discretion), to receive notices under the
Operative Agreements on behalf of the Lessor and each Primary Financing
Party and (subject to Section 8.5) to take such other action under the
Operative Agreements on behalf of the Lessor as the Agent shall
determine in its reasonable discretion from time to time. The Agent
hereby accepts such appointments. Further, the Agent shall be entitled
to take such action on behalf of the Lessor as is delegated to the
Agent under any Operative Agreement (whether express or implied) as may
be reasonably incidental thereto.
(b) Each Primary Financing Party hereby designates and
appoints the Agent as the agent of such Primary Financing Party under
this Agreement and the other Operative Agreements, and each such
Primary Financing Party authorizes the Agent, in such capacity, to
execute the Operative Agreements as agent for and on behalf of such
Primary Financing Party, to take such action on behalf of such Primary
Financing Party under the provisions of this Agreement and the other
Operative Agreements and to exercise such powers and perform such
duties as are expressly delegated to the Agent by the terms of this
Agreement and other Operative Agreements, together with such other
powers as are reasonably incidental thereto. Subject to the terms of
the Operative Agreements (including without limitation the
Intercreditor Agreement), each of the Primary Financing Parties directs
the Agent to exercise such powers, make such decisions and otherwise
perform such duties as are delegated to the Agent hereunder or
thereunder. Notwithstanding any provision to the contrary elsewhere in
this Agreement, the Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any
fiduciary relationship with any Primary Financing Party, and no implied
covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Operative
Agreement or otherwise exist against the Agent.
(c) The Agent may execute any of its duties under this
Agreement and the other Operative Agreements by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning
all matters pertaining to such duties. The Agent
52
shall not be responsible for the negligence or misconduct of any agents
or attorneys-in-fact selected by it with reasonable care.
(d) Neither the Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates shall be (a) liable
for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement or any other
Operative Agreement (except for its or such Person's own gross
negligence, willful misconduct or its or such Person's failure to use
ordinary care in the handling of funds) or (b) responsible in any
manner to any of the Primary Financing Parties for any recitals,
statements, representations or warranties made by the Borrower or the
Lessee or any officer thereof contained in this Agreement or any other
Operative Agreement or in any certificate, report, statement or other
document referred to or provided for in, or received by the Agent under
or in connection with, this Agreement or any other Operative Agreement
or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Operative Agreement or
for any failure of the Borrower or the Lessee to perform its
obligations hereunder or thereunder. The Agent shall not be under any
obligation to any Primary Financing Party to ascertain or to inquire as
to the observance or performance of any of the agreements contained in,
or conditions of, this Agreement or any other Operative Agreement, or
to inspect the properties, books or records of the Borrower or the
Lessee.
(e) The Agent shall be entitled to rely, and shall be fully
protected in relying, upon any Note, writing, resolution, notice,
consent, certificate, affidavit, letter, telecopy, telex or teletype
message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by
the proper Person or Persons and upon advice and statements of legal
counsel (including without limitation counsel to the Borrower or the
Lessee), independent accountants and other experts selected by the
Agent. The Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Agent.
The Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Operative Agreement unless it
shall first receive such advice or concurrence of the Majority Secured
Parties, the Majority Tranche A Note Purchasers, the Majority Tranche B
Lenders or all the Primary Financing Parties, as the case may be, as
set forth in the Intercreditor Agreement or any other Operative
Agreement or it shall first be indemnified to its satisfaction by the
Primary Financing Parties against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take
any such action. The Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement and the
other Operative Agreements in accordance with the Intercreditor
Agreement, and such and any action taken or failure to act pursuant
thereto shall be binding upon all the Primary Financing Parties and all
future holders of the Notes.
(f) The Agent shall not be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default hereunder unless
the Agent has received written notice from a Primary Financing Party,
any Credit Party or the Borrower referring
53
to this Agreement or such other Operative Agreement, describing such
Default or Event of Default and stating that such notice is a "notice
of default". In the event that the Agent receives such a notice, the
Agent shall give notice thereof to the Primary Financing Parties and
the Lessee. The Agent shall take such action with respect to such
Default or Event of Default as shall be reasonably directed in
accordance with the terms of the Intercreditor Agreement; provided,
--------
that unless and until the Agent shall have received such directions,
the Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event
of Default as it shall deem advisable in the best interests of the
Primary Financing Parties; provided, further, the foregoing shall not
-------- -------
limit the rights of the Majority Secured Parties, the Majority Tranche
A Note Purchasers, the Majority Tranche B Lenders or all the Primary
Financing Parties, as the case may be, as described in this Agreement
or the Intercreditor Agreement.
(g) Each Primary Financing Party expressly acknowledges that
neither the Agent nor any of its officers, directors, employees,
agents, attorneys-in-fact or Affiliates has made any representations or
warranties to it and that no act by the Agent hereinafter taken,
including without limitation any review of the affairs of the Borrower
or the Lessee, shall be deemed to constitute any representation or
warranty by the Agent to any Primary Financing Party. Each Primary
Financing Party represents to the Agent that it has, independently and
without reliance upon the Agent or any other Primary Financing Party,
and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the
business, operations, property, financial and other condition and
creditworthiness of the Borrower and the Lessee and made its own
decision to purchase its Tranche A Notes or make its Tranche B Loans
hereunder and enter into this Agreement. Each Primary Financing Party
also represents that it will, independently and without reliance upon
the Agent or any other Primary Financing Party, and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other
Operative Agreements, and to make such investigation as it deems
necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Borrower and
the Lessee. The Agent agrees to provide to the Primary Financing
Parties notices, reports and other documents that are customarily
provided by the Agent in its capacity as Agent in transactions similar
to the transactions contemplated hereby and by the other Operative
Agreements. Except for notices, reports and other documents expressly
required to be furnished to the Primary Financing Parties by the Agent
hereunder, the Agent shall not have any duty or responsibility to
provide any Primary Financing Party with any credit or other
information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of the Borrower
or the Lessee which may come into the possession of the Agent or any of
its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
(h) The Primary Financing Parties agree to indemnify the
Agent, in its capacity as such (to the extent not reimbursed by the
Borrower or the Lessee or any Credit Party and without limiting any
obligation of the Borrower or the Lessee or any Credit Party under and
in accordance with the terms of the Operative Agreements to do
54
so), ratably according to their respective Commitment Percentages in
effect on the date on which indemnification is sought under this
Section (or, if indemnification is sought after the date upon which the
Commitments shall have terminated and the Notes shall have been paid in
full, ratably in accordance with their Commitment Percentages
immediately prior to such date), from and against any and all
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind
whatsoever which may at any time (including without limitation at any
time following the payment of the Notes) be imposed on, incurred by or
asserted against any of them in any way relating to or arising out of,
the Commitments, this Agreement, any of the other Operative Agreements
or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or any action taken or
omitted by any of them under or in connection with any of the
foregoing; provided, that no Primary Financing Party shall be liable
--------
for the payment of any portion of such liabilities, obligations,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting solely from the gross negligence or willful
misconduct of the Agent, or its failure to use ordinary care in the
handling of funds. The agreements in this Section shall survive the
payment of the Notes and all other amounts payable hereunder.
(i) The Agent and its Affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the
Borrower or the Lessee as though the Agent were not the Agent hereunder
and under the other Operative Agreements. With respect to its Tranche B
Loans made or renewed by it and any Tranche B Note issued to it, the
Agent shall have the same rights and powers under this Agreement and
the other Operative Agreements as any Tranche B Lender and may exercise
the same as though it were not the Agent, and the terms "Tranche B
Lender" and "Tranche B Lenders" shall include the Agent in its
individual capacity.
(j) (i) The Agent may resign at any time as the Agent upon
sixty (60) days' notice to the Primary Financing Parties, the
Borrower and, so long as no Lease Event of Default shall have
occurred and be continuing, the Lessee. If the Agent shall
resign as the Agent under this Agreement, a successor Agent
shall be appointed by the Majority Tranche A Note Purchasers
and the Majority Tranche B Lenders which successor Agent shall
be subject to the approval of, so long as no Lease Event of
Default shall have occurred and be continuing, the Lessee,
such approval not to be unreasonably withheld or delayed. If
no successor Agent is appointed prior to the effective date of
the resignation of the resigning Agent, the Agent may appoint,
after consulting with the Primary Financing Parties and
subject to the approval of, so long as no Lease Event of
Default shall have occurred and be continuing, the Lessee,
such approval not to be unreasonably withheld or delayed, a
successor Agent. Any successor Agent, however appointed, shall
be a bank or trust company incorporated and doing business
within the United States of America and having a combined
capital and surplus of at least $200,000,000, if there be such
an institution willing, able and legally qualified to perform
the duties of the Agent hereunder upon reasonable or customary
terms. If no successor Agent has accepted appointment as the
Agent by the date which is sixty (60) days following a
retiring Agent's notice of
55
resignation, the retiring Agent's notice of resignation shall
nevertheless thereupon become effective and the Primary
Financing Parties shall perform all of the duties of the Agent
until such time, if any, as the Majority Tranche A Note
Purchasers and the Majority Tranche B Lenders appoint a
successor Agent, as provided for above. Upon the effective
date of such resignation, only such successor Agent shall
succeed to all the rights, powers and duties of the retiring
Agent and the term "Agent" shall mean such successor agent and
the retiring Agent's rights, powers and duties in such
capacity shall be terminated. After any retiring Agent resigns
hereunder as the Agent, the provisions of this Section 8.6,
Section 9.5 of the Credit Agreement and Section 15.1 of the
Note Purchase Agreement shall inure to their respective
benefit as to any actions taken or omitted to be taken by it
while it was the Agent under this Agreement.
(ii) The Agent may be removed (x) by either the
Majority Tranche A Note Purchasers or the Tranche B Lenders in
the case of fraud, misappropriation of funds or the commission
of illegal acts by the Agent or where the Agent has failed to
perform its obligations hereunder or under any other Operative
Agreement in any material respect, or (y) any time at the
request of any Primary Financing Party, but only with the
consent of the Majority Tranche A Note Purchasers and the
Majority Tranche B Lenders and so long as no Lease Event of
Default shall have occurred and be continuing, the Lessee. Any
such removal shall be effective upon the acceptance of
appointment of a successor Agent in accordance with the
provisions of paragraph (i) of this Section 8.6(j); provided,
--------
however, to the extent the Agent being replaced pursuant to
-------
clause (x) of this Section 8.6(j)(ii) is also a Tranche A Note
Purchaser or a Tranche B Lender, such Person shall not be
permitted to vote in connection with the appointment or
approval of a successor Agent pursuant to paragraph (i) of
this Section 8.6(j).
(k) Other than the exercise of reasonable care to assure the
safe custody of the Collateral while being held by the Agent hereunder
or under any other Operative Agreement, the Agent shall have no duty or
liability to preserve rights pertaining thereto, it being understood
and agreed that the Lessee shall be responsible for preservation of all
rights in the Collateral, and the Agent shall be relieved of all
responsibility for the Collateral upon surrendering it or tendering the
surrender of it to the Lessee. The Agent shall be deemed to have
exercised reasonable care in the custody and preservation of the
Collateral in its possession if the Collateral is accorded treatment
substantially equal to that which the Agent accords its own property,
which shall be no less than the treatment employed by a reasonable and
prudent agent in the industry, it being understood that the Agent shall
not have responsibility for taking any necessary steps to preserve
rights against any parties with respect to any of the Collateral.
8.7. Collection and Allocation of Payments and Other Amounts.
-------------------------------------------------------
(a) Each Credit Party has agreed pursuant to Section 5.10 and
otherwise in accordance with the terms of this Agreement to pay to (i)
the Agent any and all Rent (excluding Excepted Payments) and any and
all other amounts of any kind or type under
56
any of the Operative Agreements due and owing or payable by the Lessee
or any other Credit Party to any party hereto, and (ii) each Person, as
appropriate, the Excepted Payments. Promptly after receipt, the Agent
shall apply and allocate, in accordance with the terms of this Section
8.7, such amounts received from any Credit Party and all other
payments, receipts and other consideration of any kind whatsoever
received by the Agent pursuant to the Security Agreement or otherwise
received by the Agent, the Lessor or any of the Primary Financing
Parties in connection with the Collateral, the Security Documents or
any of the other Operative Agreements. Ratable distributions among the
Primary Financing Parties under this Section 8.7 shall be made based on
the ratio of the amounts outstanding under the Notes to the aggregate
Property Cost. Ratable distributions among the Tranche A Note
Purchasers under this Section 8.7 shall be made based on the ratio of
the amounts outstanding under an individual Tranche A Note Purchaser's
Tranche A Note to the aggregate of all amounts outstanding under all of
the Tranche A Note Purchasers' Tranche A Notes. Ratable distributions
among the Tranche B Lenders under this Section 8.7 shall be made based
on the ratio of the individual Tranche B Lender's Commitment for
Tranche B Loans to the aggregate of all the Tranche B Lenders'
Commitments for Tranche B Loans.
(b) Payments and other amounts received by the Agent or the
Lessor from time to time in accordance with the terms of subparagraph
(a) shall be applied and allocated as follows (subject in all cases to
Section 8.7(c)):
(i) Any such payment or amount identified as or
deemed to be Basic Rent shall be applied and allocated by the
Agent if no Lease Default or Lease Event of Default is in
effect, first, ratably to the Primary Financing Parties for
-----
application and allocation to the payment of interest on the
Notes and thereafter the principal of the Notes which is due
and payable on such date; second, to any and all other amounts
------
owing under the Operative Agreements to the Primary Financing
Parties; third, any excess shall be paid to the Lessee or such
-----
Person or Persons as the Lessee may designate; provided, that
--------
if a Lease Default or Lease Event of Default is in effect,
such amounts shall instead be held by the Agent until the
earlier of (I) the first date thereafter on which no Lease
Default or Lease Event of Default shall be in effect (in which
case such amounts shall be applied pursuant to this
subparagraph (i) and (II) the Expiration Date, (or, if
earlier, the date of any Acceleration), in which case such
amounts shall be applied and allocated in the manner
contemplated by Section 8.7(b)(iv).
(ii) If on any date the Agent or the Lessor shall
receive any amount in respect of any Casualty, Condemnation or
Environmental Violation pursuant to Sections 15.1(a) or
15.1(g) of the Lease (excluding any payments in respect
thereof which are payable to the Lessee in accordance with the
Lease) and such payment is in an amount less than the
Termination Value at such time, the Lessor or the Agent, as
the case may be, shall be required to pay such amount received
in accordance with Section 8.7(b)(iii) hereof; provided, that
--------
any excess shall be paid to Lessee or its designee in
accordance with Section 15.1 of the Lease.
57
(iii) An amount equal to any payment identified as
proceeds of the sale or other disposition (or lease upon the
exercise of remedies) of the Property to a third party or any
portion thereof, whether pursuant to Article XXII of the Lease
or the exercise of remedies under the Security Documents or
otherwise or the exercise of foreclosure remedies under the
Lease, any payment in respect of excess wear and tear pursuant
to Section 22.3 of the Lease (whether such payment relates to
a period before or after the Construction Period Termination
Date) shall be applied and allocated by the Agent first,
-----
ratably to the payment of the principal and interest of the
Tranche B Loans then outstanding, second, to any and all other
------
amounts owing under the Operative Agreements to the Tranche B
Lenders under the Tranche B Loans, third, to the extent such
-----
amount exceeds the maximum amount to be returned pursuant to
the foregoing provisions of this paragraph (iii), ratably to
the payment of the principal, interest and Make-Whole Amount,
if any, on the Tranche A Notes then outstanding, fourth, to
------
any and all other amounts owing under the Operative Agreements
to the Tranche A Note Purchasers under the Tranche A Notes,
and fifth, to the extent moneys remain after application and
-----
allocation pursuant to clauses first through fourth above, to
----- ------
the Lessor for application and allocation as the Lessor shall
determine.
(iv) An amount equal to (A) any payment pursuant to
Section 22.1(b) of the Lease (or otherwise) of the Maximum
Residual Guarantee Amount in respect of the Property, (B) any
other amount payable after the occurrence of an Event of
Default not covered by Sections 8.7(b)(i) or 8.7(b)(iii) above
(including without limitation any amount received in
connection with an action for liquidated damages pursuant to
Section 17.4 or Section 17.6 of the Lease or a payment of the
Maximum Amount or by set off by the Agent) and (C) any other
amount payable by the Guarantor pursuant to the Guaranty shall
be applied and allocated by the Agent first, ratably, to the
-----
payment of the principal, interest and Make-Whole Amount, if
any, on the Tranche A Notes then outstanding, second, to any
------
and all other amounts owing under the Operative Agreements to
the Tranche A Note Purchasers under the Tranche A Notes,
third, to the extent such amount exceeds the maximum amount to
-----
be retained pursuant to the foregoing provisions of this
paragraph (iv), ratably to the payment of the principal and
interest balance of the Tranche B Loans then outstanding,
fourth, to the payment of any other amounts owing to the
------
Tranche B Lenders under the Tranche B Loans, and fifth, to the
-----
extent moneys remain after application and allocation pursuant
to clauses first through fourth above, to the Lessor for
----- ------
application and allocation as the Lessor shall determine.
(v) An amount equal to any such payment identified as
Supplemental Rent payable to the Agent, the Lessor or any
Primary Financing Party shall be applied and allocated by the
Agent to the payment of any amounts then owing to the Agent,
the Primary Financing Parties, the Lessor and the other
parties to the Operative Agreements (or any of them) (other
than any such amounts payable pursuant to the preceding
provisions of this Section 8.7(b)) as shall be determined by
the Agent in its reasonable discretion; provided, however,
-------- -------
that Supplemental
58
Rent received after the occurrence and continuance of an Event
of Default shall be applied and allocated as set forth in
Section 8.7(b)(iv).
(vi) Except as set forth in subparagraph (ii) of this
Section 8.7(b), any payment of Termination Value shall be
applied and allocated by the Agent if no Lease Default or
Lease Event of Default is in effect, first, ratably to the
-----
Primary Financing Parties for application and allocation to
the payment of the principal, interest and Make-Whole Amount,
if any, on the Notes which is due and payable on such date;
second, to any and all other amounts owing under the Operative
------
Agreements to the Primary Financing Parties; third, any excess
-----
shall be paid to the Lessee or such Person or Persons as the
Lessee may designate; provided, that if a Lease Default or
--------
Lease Event of Default is in effect, such amount shall be
applied and allocated in the manner contemplated by Section
8.7(b)(iv).
(vii) The Agent in its reasonable judgment shall
identify the nature of each payment or amount received by the
Agent and apply and allocate each such amount in the manner
specified above.
(c) Notwithstanding any provision contained herein or in any
other Operative Agreement to the contrary, upon the payment in full of
the Loans and all other amounts then due and owing by the Lessor
hereunder or under any Operative Agreement and the payment in full of
all other amounts then due and owing to the Primary Financing Parties,
the Lessor, the Agent and the other Financing Parties pursuant to the
Operative Agreements, any moneys remaining with the Agent shall be
returned to the Lessee or its designee. Notwithstanding the foregoing,
the obligations of the Lessee to pay all amounts due to any Financing
Party under the Notes or any other Operative Agreement shall be
automatically reinstated if and to the extent that for any reason any
payment by or on behalf of the Lessee is rescinded or must be otherwise
restored by any Financing Party, whether as a result of any proceedings
in bankruptcy or reorganization or otherwise, and the Lessee agrees
that it will, subject to Section 11.7 of the Participation Agreement,
indemnify each Financing Party on demand for all reasonable costs and
expenses (including, without limitation, reasonable fees of counsel)
incurred by any Financing Party in connection with such rescission or
restoration, including without limitation any such costs and expenses
incurred in defending against any claim alleging that such payment
constituted a preference, fraudulent transfer or similar payment under
any bankruptcy, insolvency or similar law.
8.8. Release of Properties, etc.
--------------------------
If the Lessee shall at any time purchase the Property pursuant to the
Lease, or the Construction Agent shall purchase the Property pursuant to the
Agency Agreement, or if the Property shall be sold in accordance with Article
XXII of the Lease, then, upon satisfaction by the Borrower of its obligation to
prepay the Loans and all other amounts owing to the Primary Financing Parties
under the Operative Agreements, the Agent is hereby authorized and directed to
release such Property from the Liens created by the Security Documents to the
extent of its interest therein. In addition, upon the termination of the
Commitments and the payment in full of
59
the Loans and all other amounts owing by the Borrower and the Lessee hereunder
or under any other Operative Agreement, the Agent is hereby authorized and
directed to release the Property from the Liens created by the Security
Documents to the extent of its interest therein. Upon request of the Borrower
following any such release, the Agent shall, at the sole cost and expense of the
Lessee, execute and deliver to the Borrower and the Lessee such documents as the
Borrower or the Lessee shall reasonably request to evidence such release.
8.9. Limitation of Lessor's Obligations.
----------------------------------
(a) The Lessor shall not have any duty or obligation to
manage, control, use, make any payment in respect of, register, record,
insure, inspect, sell, dispose of or otherwise deal with the Property
or any other part of the Borrower's Interest, or to otherwise take or
refrain from taking any action under or in connection with any
Operative Agreement to which the Lessor is a party, except as expressly
provided by the terms of the Operative Agreements or in written
instructions from all the Primary Financing Parties and/or the Majority
Secured Parties, as applicable, received pursuant to Section 8.6; and
no implied duties or obligations shall be read into the Operative
Agreements against the Lessor. The Lessor shall have no duty or
obligation to supervise or monitor the performance of the Construction
Agent by the Agency Agreement, which for all purposes shall be an
independent contractor. The Lessor nevertheless agrees that it will
promptly take all action as may be necessary to discharge any Lessor
Liens on any part of the Property.
(b) The Lessor agrees that it will not manage, control, use,
sell, dispose of or otherwise deal with the Property or any other part
of the Borrower's Interest except (a) as required by the terms of the
Operative Agreements, (b) in accordance with the powers granted to, or
the authority conferred upon, it pursuant to the Operative Agreements
or (c) in accordance with the express terms hereof and with written
instructions from all the Primary Financing Parties and/or the Majority
Secured Parties, as applicable, pursuant to Section 8.6.
(c) Except in accordance with written instructions furnished
pursuant to an applicable provision of the Operative Agreements
(expressly cited in such instructions), and without limitation of the
generality of Section 8.9(a), the Lessor shall not have any duty to (i)
file, record or deposit any Operative Agreement or any other document,
or to maintain any such filing, recording or deposit or to refile,
rerecord or redeposit any such document; (ii) obtain insurance on the
Property or effect or maintain any such insurance, other than to
receive and forward to each Primary Financing Party and the Agent any
notices, policies, certificates or binders furnished to the Lessor
pursuant to the Lease; (iii) maintain the Property; (iv) pay or
discharge any Tax or any Lien owing with respect to or assessed or
levied against any part of the Borrower's Interest, except as provided
in the last sentence of Section 8.9(a), other than to forward notice of
such Tax or Lien received by the Lessor to each Primary Financing Party
and the Agent; (v) confirm, verify, investigate or inquire into the
failure to receive any reports or financial statements of Lessee or any
other Person; (vi) inspect the Property at any time or ascertain or
inquire as to the performance or observance of any of the covenants of
Lessee or any other Person
60
under any Operative Agreement with respect to the Property; or (vii)
manage, control, use, sell, dispose of or otherwise deal with the
Property or any part thereof or any other part of the Borrower's
Interest, except as provided in Section 8.9(b) .
(d) The Lessor, in the exercise or administration of its
powers pursuant to the Operative Agreements, may, at the expense and,
so long as no Lease Default or Lease Event of Default shall have
occurred and be continuing, with the consent of Lessee (which amounts
may be funded prior to the Construction Period Termination Date in
accordance with the Operative Agreements) employ agents, attorneys,
accountants, and auditors and enter into agreements with any of them
and the Lessor shall not be liable for the default or misconduct of any
such agents, attorneys, accountants or auditors if such agents,
attorneys, accountants or auditors shall have been selected by it with
reasonable care.
8.10. No Representations or Warranties as to the Property or
------------------------------------------------------
Operative Agreements.
--------------------
THE LESSOR MAKES (i) NO REPRESENTATION OR WARRANTY, EITHER
EXPRESS OR IMPLIED, AS TO THE TITLE, VALUE, USE, CONDITION, DESIGN, OPERATION,
MERCHANTABILITY OR FITNESS FOR USE OF THE PROPERTY (OR ANY PART THEREOF), OR ANY
OTHER REPRESENTATION, WARRANTY OR COVENANT WHATSOEVER, EXPRESS OR IMPLIED, WITH
RESPECT TO THE PROPERTY (OR ANY PART THEREOF) AND THE LESSOR SHALL NOT BE LIABLE
FOR ANY LATENT, HIDDEN, OR PATENT DEFECT THEREIN OR THE FAILURE OF THE PROPERTY,
OR ANY PART THEREOF, TO COMPLY WITH ANY LEGAL REQUIREMENT except that the Lessor
hereby represents, warrants and covenants to each Primary Financing Party that
it will comply with the last sentence of Section 8.9(a), and (ii) no
representation or warranty as to the validity or enforceability of any Operative
Agreement as against any Person other than the Lessor or as to the correctness
of any statement made by a Person other than the Lessor contained in any
thereof.
8.11. Reliance; Advice of Counsel.
---------------------------
The Lessor shall not incur any liability to any Person in acting upon
any signature, instrument, notice, resolution, request, consent, order,
certificate, report, opinion, bond or other document or paper reasonably
believed by it to be genuine and believed by it in good faith to be signed by
the proper party or parties. The Lessor may accept and rely upon a certified
copy of a resolution of the board of directors or other governing body of any
corporate party as conclusive evidence that such resolution has been duly
adopted by such body and that the same is in full force and effect. As to any
fact or matter the manner of ascertainment of which is not specifically
prescribed herein, the Lessor may for all purposes of the Operative Agreements
rely on an Officer's Certificate of the relevant party, as to such fact or
matter, and such certificate shall constitute full protection to the Lessor for
any action taken or omitted to be taken by it reasonably in good faith in
reliance thereon. In the administration of the Lessor's duties, the Lessor may
execute and perform its powers and duties directly or through agents or
attorneys and may consult with counsel, accountants and other skilled Persons to
be selected and employed
61
by it, and the Lessor shall not be liable for anything done, suffered or omitted
reasonably in good faith by it in accordance with the advice or opinion of any
such counsel, accountants or other skilled Persons and not contrary to the
Operative Agreements.
8.12. Recordation of the Lease Supplement and/or Memorandum of
--------------------------------------------------------
Lease.
-----
The Agent, the Primary Financing Parties and the Lessor hereby covenant
and agree that, so long as the credit rating of the senior, unsecured long-term
indebtedness of Capital One Bank has not fallen below either Baa3 (as rated by
Moody's) or BBB- (as rated by S&P) and so long as no Lease Event of Default
exists, the Agent shall hold in escrow and shall not record the Lease Supplement
and/or Memorandum of Lease executed by the Lessee or the financing statements
executed by the Lessee in regard thereto. In the event that either (a) the
credit rating of the senior, unsecured long-term indebtedness of Capital One
Bank falls below either Baa3 (as rated by Moody's) or BBB- (as rated by S&P) or
(b) a Lease Event of Default occurs and is continuing, then (i) the Agent may,
in its sole discretion, record the Lease Supplement and/or Memorandum of Lease
executed by the Lessee and the financing statements executed by the Lessee in
regard thereto, and (ii) the Lessee covenants and agrees to (A) cause to be
delivered to the Agent, at the expense of the Lessee, a title insurance policy
or policies, which title policy or policies shall be in form and substance
reasonably satisfactory to the Agent in its reasonable discretion, (B) cause to
be delivered to the Agent, at the expense of the Lessee, a legal opinion (in
form and substance reasonably satisfactory to the Agent and from legal counsel
reasonably satisfactory to the Agent) and (C) pay all necessary recording fees,
documentary stamp taxes and similar amounts required to be paid in connection
with the recording of such Lease Supplement and/or Memorandum of Lease and the
financing statements executed by the Lessee in regard thereto.
8.13 Amendments to Guarantor Credit Agreement.
----------------------------------------
The Credit Parties hereby agree to furnish, or cause to be furnished,
to the Agent and each of the Tranche A Note Purchasers, promptly upon the
effectiveness thereof, notice of any additions, amendments or modifications to
the general corporate, financial and negative covenants set forth in the
Guarantor Credit Agreement (including, but not limited to the covenants set
forth in Section 8 thereof but other than the limitations on Liens covenant set
forth in Section 8.06 of the Guarantor Credit Agreement or any covenant relating
solely to COFC) to the extent the same are not included in, or are less
favorable to COB and/or FSB than, the covenants set forth in Sections 8.3, 8.3A,
8.3B, 8.3C and 8.3D. In such event, each of COB and FSB hereby agrees to make
modifications or supplements to the covenants set forth in Sections 8.3, 8.3A,
8.3B, 8.3C and 8.3D in a manner consistent with such addition, amendment,
modification or supplement made to such covenants in the Guarantor Credit
Agreement. Notwithstanding the foregoing, each of COB and FSB hereby further
agree that such changes, additions, modifications or supplements to such
covenants shall be deemed effective hereunder upon the effectiveness of such
modification or addition to such covenants set forth in the Guarantor Creditor
Agreement, without any further action on the part of the Majority Tranche A Note
Purchasers, including, without limitation, the entering into of a written
amendment or supplement to any Operative Agreement. The parties agree to enter
into a written amendment or supplement memorializing any of such changes,
additions, modifications or supplements upon the request of any other party.
62
8.14 Joint and Several Liability of the Lessees and Construction
-----------------------------------------------------------
Agents.
------
(a) Each of FSB and COB (for purposes of this Section 8.14 and
Section 8.15, each of FSB and COB may be referred to as a "Co-Lessee"
---------
or, collectively FSB and COB may be referred to as the "Co-Lessees") is
----------
accepting joint and several liability for the obligations of the Lessee
and the Construction Agent hereunder and under the other Operative
Agreements (including without limitation the Lease and the Agency
Agreement) in consideration of the financial accommodation to be
provided by the Financing Parties under the Operative Agreements, for
the mutual benefit, directly and indirectly, of each of the Co-Lessees.
(b) Notwithstanding any term or provision in any Operative
Agreement to the contrary, each Co-Lessee jointly and severally hereby
irrevocably and unconditionally accepts, not merely as a surety but
also as a co-debtor or co-lessee, joint and several liability with
every other Co-Lessee with respect to the payment and performance of
all of the obligations of the Lessee or the Construction Agent arising
under the Operative Agreements, it being the intention of the parties
hereto that all the obligations of the Lessee or the Construction Agent
shall be the joint and several obligations of each of the Co-Lessees
without preferences or distinction among them.
(c) If and to the extent that any Co-Lessee shall fail to make
any payment with respect to any obligations of the Lessee or the
Construction Agent hereunder as and when due or to perform any of such
obligations in accordance with the terms hereof or under the other
Operative Agreements, then in each such event, the other Co-Lessee will
make such payment with respect to, or perform, such obligation.
(d) The obligations of each Co-Lessee under the provisions of
this Section 8.14 constitute full recourse obligations of such
Co-Lessee, enforceable against it to the full extent of its properties
and assets, irrespective of the validity, regularity or enforceability
of any Operative Agreement or any other circumstances whatsoever.
(e) Except as otherwise expressly provided herein, each
Co-Lessee hereby waives notice of acceptance of its joint and several
liability, notice of occurrence of any Default or Event of Default
(except to the extent notice is expressly required to be given to the
Lessee pursuant to the terms of any Operative Agreement), or of any
demand for any payment of the Lessee or the Construction Agent under
any Operative Agreement, notice of any action at any time taken or
omitted by any Financing Party under or in respect of any of the
obligations of the Lessee or the Construction Agent hereunder, any
requirement of diligence and, generally, all demands, notices and other
formalities of every kind in connection with any Operative Agreement.
Each Co-Lessee hereby assents to, and waives notice of, any extension
or postponement of the time for the payment of any of the obligations
of the Lessee or the Construction Agent hereunder or under the other
Operative Agreements, the acceptance of any partial payment thereon,
any waiver, consent or other action or acquiescence by any Financing
Party at any time or times in respect of any default by any Credit
Party in the performance or satisfaction of any term,
63
covenant, condition or provision of any Operative Agreement, any and
all other indulgences whatsoever by the Financing Parties in respect of
any of the obligations of the Lessee or the Construction Agent
hereunder, and the taking, addition, substitution or release, in whole
or in part, at any time or times, of any security for any of such
obligations or the addition, substitution or release, in whole or in
part, of any Co-Lessee. Without limiting the generality of the
foregoing, each Co-Lessee assents to any other action or delay in
acting or any failure to act on the part of the Financing Parties,
including, without limitation, any failure strictly or diligently to
assert any right or to pursue any remedy or to comply fully with
applicable laws or regulations thereunder which might, but for the
provisions of this Section 8.14, afford grounds for terminating,
discharging or relieving such Co-Lessee, in whole or in part, from any
of its obligations under this Section 8.14, it being the intention of
each Co-Lessee that, so long as any of the obligations of the Lessee or
the Construction Agent hereunder or under the other Operative
Agreements remain unsatisfied, the obligations of such Co-Lessee under
this Section 8.14 shall not be discharged hereunder except by
performance and then only to the extent of such performance. The
obligations of each Co-Lessee hereunder shall not be diminished or
rendered unenforceable by any winding up, reorganization, arrangement,
liquidation, reconstruction or similar proceeding with respect to any
reconstruction or similar proceeding with respect to any Co-Lessee or
any Financing Party. The Co-Lessees hereby waive the application of
Section 502(b)(6) of the Bankruptcy Code or any other analogous
provision of any other applicable Law. The joint and several liability
of the Co-Lessees hereunder and under the other Operative Agreements
shall continue in full force and effect notwithstanding any absorption,
merger, amalgamation or any other change whatsoever in the name,
membership, constitution or place of formation of any Co-Lessee or any
Financing Party.
(f) The provisions of this Section 8.14 are made for the
benefit of the Financing Parties and their respective successors and
assigns, and may be enforced by any such Person from time to time
against any of the Co-Lessees under and in accordance with the terms of
the Operative Agreements as often as occasion therefor may arise and
without requirement on the part of any Financing Party first to marshal
any of its claims or to exercise any of its rights against any of the
other Co-Lessees or to exhaust any remedies available to it against any
of the other Co-Lessees or to resort to any other source or means of
obtaining payment of any of the obligations of the Lessee or the
Construction Agent or to elect any other remedy. Without limiting the
generality of the foregoing, each Co-Lessee hereby specifically waives
the benefits of N.C. Gen. Stat.(S)(S).26-7 through 26-9, inclusive, to
the extent applicable. The provisions of this Section 8.14 shall remain
in effect until all the obligations of the Lessee or the Construction
Agent hereunder and under any of the other Operative Agreements shall
have been paid in full or otherwise fully satisfied. If at any time,
any payment, or any part thereof, made in respect of any of the
obligations of the Lessee or the Construction Agent, is rescinded or
must otherwise be restored or returned by any Financing Party upon the
insolvency, bankruptcy or reorganization of any of the Co-Lessees, or
otherwise, the provisions of this Section 8.14 will forthwith be
reinstated and in effect as though such payment had not been made.
64
(g) Notwithstanding any provision to the contrary contained
herein or in any other of the Operative Agreements, the obligations of
each Co-Lessee hereunder and under the other Operative Agreements shall
be limited to an aggregate amount equal to the largest amount that
would not render its obligations hereunder subject to avoidance under
Section 548 of the Bankruptcy Code or any comparable provisions of any
applicable Law.
8.15 Appointment of COB as Agent for FSB.
-----------------------------------
FSB hereby appoints COB, and COB hereby accepts such appointment, to
act as its agent for all purposes under this Agreement and the other Operative
Agreements. Each of FSB and COB acknowledges and agrees that (a) COB may execute
such documents on behalf of all the Co-Lessees as COB deems appropriate in its
sole discretion and each Co-Lessee shall be bound by and obligated by all of the
terms of any such document executed by COB on its behalf, (b) any notice or
other communication delivered by the Agent or any other Financing Party
hereunder and under the other Operative Agreements to COB shall be deemed to
have been delivered to each of the Co-Lessees and (c) the Agent and each of the
other Financing Parties shall accept (and shall be permitted to rely on) any
document or agreement executed by COB on behalf of the Co-Lessees (or either of
them).
SECTION 9. CREDIT AGREEMENT.
9.1. The Construction Agent's and the Lessee's Credit Agreement and
--------------------------------------------------------------
Note Purchase Agreement Rights.
------------------------------
Notwithstanding anything to the contrary contained in the Credit
Agreement, the Agent, the Tranche A Note Purchasers, the Tranche B Lenders, the
Credit Parties and the Lessor hereby agree that, prior to the occurrence and
continuation of any Lease Default under Sections 17.1(a), (b), (g), (h) or (j)
of the Lease or Lease Event of Default, the Construction Agent or the Lessee, as
the case may be, shall have the following rights:
(a) the right to designate an account to which amounts funded
under the Operative Agreements shall be credited pursuant to Section
2.3(a) of the Credit Agreement;
(b) the right to terminate or reduce the Tranche B Commitments
pursuant to Section 2.5(a) of the Credit Agreement;
(c) the right to exercise the conversion and continuation
options pursuant to Section 2.7 of the Credit Agreement;
(d) the right to receive any notice and any certificate, in
each case issued pursuant to Section 2.11(a) of the Credit Agreement;
65
(e) the right to replace any Tranche B Lender pursuant to
Section 2.11(b) of the Credit Agreement;
(f) the right to approve any successor Escrow Agent; and
(g) the right to consent to any assignment by a Tranche B
Lender to which the Lessor has the right to consent pursuant to Section
9.8 of the Credit Agreement.
SECTION 10. TRANSFER OF INTEREST.
10.1. Restrictions on Transfer.
------------------------
(a) Each Tranche B Lender may participate, assign or
transfer all or a portion of its interest hereunder and under the other
Operative Agreements in accordance with Sections 9.7 and 9.8 of the
Credit Agreement; provided, that each Tranche B Lender that
--------
participates, assigns or transfers all or a portion of its interest
hereunder and under the other Operative Agreements shall deliver to the
Agent and the Lessee a copy of each Assignment and Acceptance (as
referenced in Section 9.8 of the Credit Agreement) for purposes of
maintaining the Register. The Lessor may, subject to the rights of the
Lessee under the Lease and the other Operative Agreements and to the
Lien of the applicable Security Documents, but only with the prior
written consent of the Agent and, so long as no Lease Default under
Sections 17.1(a), (b), (g), (h) or (j) of the Lease or Lease Event of
Default shall have occurred and be continuing, the Lessee (which
consent may be withheld by the Agent or the Lessee in such party's sole
discretion) at Lessor's sole expense, directly or indirectly, assign,
convey, appoint an agent with respect to enforcement of, or otherwise
transfer any of its right, title or interest in or to the Property, the
Lease and the other Operative Agreements (including without limitation
any right to indemnification thereunder), or any other document
relating to the Property or any interest in the Property as provided in
the Lease to any Person with a minimum net worth of at least
$200,000,000.00 and a Debt Rating of a Rating Agency of "A" or higher.
The provisions of the immediately preceding sentence shall not apply to
the obligations of the Lessor to transfer the Property to the Lessee,
its designee or a third party purchaser pursuant to Article XXII of the
Lease upon payment for the Property in accordance with the terms and
conditions of the Lease. Except as otherwise expressly permitted under
the Operative Agreements (including pursuant to Article XXV of the
Lease), no Credit Party may assign any of the Operative Agreements or
any of their respective rights or obligations thereunder or with
respect to the Property in whole or in part to any Person without the
prior written consent of the Agent, each Primary Financing Party and
the Lessor. Each Tranche A Note Purchaser may participate, assign or
transfer all or a portion of its interest hereunder and under the other
Operative Agreements only in accordance with the provisions of the Note
Purchase Agreement.
(b) Notwithstanding anything to the contrary in Section
10.1(a), no consent shall be required from the Agent, the Lessee or any
Primary Financing Party (but Lessor shall provide one hundred eighty
(180) days (or such shorter period as required by the
66
Legal Requirement giving rise to the assignment, conveyance,
appointment or transfer contemplated by this Section 10.1(b)) written
notice to the Agent and the Lessee) in connection with any assignment,
conveyance, appointment or transfer by the Lessor required by any Legal
Requirement of all or any of its right, title or interest in or to the
Property, the Lease and the other Operative Agreements (including
without limitation any right to indemnification thereunder), or any
other document relating to the Property or any interest in the Property
as provided in the Lease to a special purpose entity or any Person with
a minimum net worth of at least $200,000,000.00 and a Debt Rating of a
Rating Agency of "A" or higher; provided, in such case, Lessee shall
--------
have the right to require the Lessor (unless such transfer or
conveyance has already occurred, in which case the Lessee shall have
the right to require such transferee) to transfer its interest to
another Person with a minimum net worth of at least $200,000,000.00 and
a Debt Rating of a Rating Agency of "A" or higher selected by the
Lessee, in its reasonable discretion; provided, further, Lessee shall
-------- -------
be responsible for any cost or expense incurred by the Lessor in
connection with any assignment, conveyance, appointment or transfer by
the Lessor pursuant to this Section 10.1(b).
(c) Subject to Section 11.7, the Lessee agrees to indemnify
the Lessor for any loss, claim or increased costs incurred by the
Lessor and quantified to Lessee in writing by Lessor in reasonable
detail as a result of any change in GAAP that adversely affects the
Lessor; provided, however, in the case of such a change in GAAP that
-------- -------
adversely affects the Lessor, as long as no Lease Default under
Sections 17.1(a), (b), (g), (h) or (j) of the Lease or Lease Event of
Default shall have occurred and be continuing, Lessee shall have the
right to require the Lessor to transfer its interest to another Person
with a minimum net worth of at least $200,000,000.00 and a Debt Rating
of a Rating Agency of "A" or higher selected by the Lessee, in its
reasonable discretion; provided, further, nothing in the preceding
-------- -------
proviso shall limit the obligation of the Lessee to provide the
indemnity set forth in this Section 10.1(c).
(d) Upon the occurrence and during the continuance of an
Event of Default by the Lessor, Lessee shall have the right to require
the Lessor to transfer its interest in the Property and the Operative
Agreements to a Person with a minimum net worth of at least
$200,000,000.00 and a Debt Rating of a Rating Agency of "A" or higher
selected by the Lessee, in its reasonable discretion.
10.2. Effect of Transfer.
------------------
From and after any transfer effected in accordance with this Section
10, 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 shall remain liable hereunder and under
-------- -------
such other documents to the extent that the transferee shall not have assumed
the obligations of the transferor thereunder. Upon any transfer by the Lessor or
a Primary Financing Party as above provided, any such transferee shall assume
the obligations of the Lessor or the Primary Financing Party, as the case may
be, and shall be deemed the "Lessor" or a "Primary Financing Party", as the case
may be, for all purposes of such documents and each reference herein to the
67
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 10, 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 11. INDEMNIFICATION.
11.1. General Indemnity.
-----------------
Whether or not any of the transactions contemplated hereby shall be
consummated, the Indemnity Provider hereby assumes liability for and agrees to
defend, indemnify and hold harmless each Indemnified Person on an After Tax
Basis from and against any Claims which may be imposed on, incurred by or
asserted against an Indemnified Person by any third party, including without
limitation Claims arising from the negligence of an Indemnified Person (but not
to the extent such Claims arise from the gross negligence or willful misconduct
of such Indemnified Person, as determined by a court of competent jurisdiction)
in any way relating to or arising or alleged to arise out of the execution,
delivery, performance or enforcement of this Agreement, the Lease or any other
Operative Agreement or on or with respect to the Property or any component
thereof, including without limitation Claims in any way relating to or arising
or alleged to arise out of (a) the financing, refinancing, purchase, acceptance,
rejection, ownership, design, construction, refurbishment, development,
delivery, nondelivery, leasing, subleasing, possession, use, occupancy,
operation, maintenance repair, modification, transportation, condition, sale,
return, repossession (whether by summary proceedings or otherwise), or any
disposition of the Property or any part thereof, including without limitation
the acquisition, holding or disposition of any interest in the Property, lease
or agreement comprising a portion of any thereof; (b) any latent or other
defects in the Property or any portion thereof whether or not discoverable by an
Indemnified Person or the Indemnity Provider; (c) a violation of, or penalties
arising from any violation of, Environmental Laws, Environmental Claims or other
loss of or damage to any property or the environment, including any Claim
relating to the Property, the Lease, the Agency Agreement or the Indemnity
Provider; (d) the Operative Agreements, or any transaction contemplated thereby;
(e) any breach by the Indemnity Provider of any of its representations or
warranties under the Operative Agreements to which the Indemnity Provider is a
party or failure by the Indemnity Provider to perform or observe any covenant or
agreement to be performed by it under any of the Operative 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)
personal injury, death or property damage, including without limitation Claims
based on strict or absolute liability in tort; (h) any Claim for patent,
trademark or copyright infringement; and (i) any fees, expenses and/or other
assessments by any business park or any other applicable entity with oversight
responsibility for the Property; provided, however, that the Indemnity Provider
-------- -------
shall not be required to indemnify any Indemnified Person under this Agreement
or any of the other Operative Agreements for any of the following:
(i) any Claim by the Lessor resulting from Lessor Liens
which any Indemnified Person is responsible for discharging under the
Operative Agreements; (ii)
68
any Claim by an Indemnified Person arising from a breach or alleged
breach by such Indemnified Person of any agreement entered into in
connection with the assignment or participation by such Indemnified
Person of any Note or any interest therein; (iii) a Claim by an
Indemnified Person arising from the offer, sale or delivery by such
Indemnified Person of the Notes or an interest related thereto not
attributable to acts or omissions of an Indemnity Provider; (iv) a
Claim by an Indemnified Person resulting from a violation of any Legal
Requirement by such Indemnified Person, (v) except to the extent
indemnified hereunder pursuant to Section 11.4, any claim for economic
losses based upon the rate of return on the Notes and (vi) the transfer
of the Property by any Indemnified Person other than pursuant to the
Lease or the Agency Agreement or in connection with the exercise of
rights or remedies under the Operative Agreements.
This Section 11.1 shall be construed as an indemnity only and shall not
be construed as a guaranty of residual value of any of the Property (including,
without limitation, with respect to payment of the Property Cost), or as a
guaranty of the Notes. The parties hereto acknowledge and agree that this
Section 11.1 shall not be construed as an indemnity with respect to Impositions
or any other taxes and that the Lessee's sole indemnification obligation with
respect to Impositions shall be as set forth in Section 11.2.
If a written Claim is made against any Indemnified Person or if any
proceeding shall be commenced against such Indemnified Person (including without
limitation 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 period of
thirty (30) days, such Indemnified Person shall endeavor to, in such notice to
the Indemnity Provider, inform the Indemnity Provider of such shorter period,
and no action shall be taken with respect to such Claim without the consent of
the Indemnity Provider before seven (7) days before the end of such shorter
period unless the Indemnified Person shall be required by such law or regulation
to take action prior to the end of such seven (7) day 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 and adversely affects the ability
of the Indemnity Provider to contest 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 reasonable expense of the Indemnity Provider,
in good faith conduct and control such action (including without limitation by
pursuit of appeals) (provided, however, that (A) if such Claim, in the Indemnity
-------- -------
Provider's reasonable discretion, can be pursued by the Indemnity Provider on
behalf of or in the name of such Indemnified Person, the Indemnified Person, at
the Indemnity Provider's request, shall allow the Indemnity Provider to conduct
and control the response to such Claim and (B) in the case of any Claim (and
notwithstanding the provisions of the foregoing subsection (A)), the Indemnified
Person may request in writing that the Indemnity
69
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 or delayed; provided, however, that
-------- -------
any Indemnified Person may retain separate counsel at the expense of the
Indemnity Provider in the event of a potential conflict of interest between such
Indemnified Person and the Indemnity Provider)) by, in the sole discretion of
the Person conducting and controlling the response to such Claim (1) resisting
payment thereof, (2) not paying the same except under protest, if protest is
necessary and proper, (3) if the payment be made, using reasonable efforts to
obtain a refund thereof in appropriate administrative and judicial proceedings,
or (4) taking such other action as is reasonably requested by the Indemnity
Provider from time to time.
The party controlling the response to any Claim shall consult in good
faith with the non-controlling party and shall keep the non-controlling party
reasonably informed as to the conduct of the response to such Claim; provided,
--------
that all decisions ultimately shall be made in the discretion of the controlling
party. The parties agree that an Indemnified Person may at any time decline to
take further action with respect to the response to such Claim and may settle
such Claim if such Indemnified Person shall waive its rights to any indemnity
from the Indemnity Provider that otherwise would be payable in respect of such
Claim (and any future Claim, the pursuit of which is precluded by reason of such
resolution of such Claim) and shall pay to the Indemnity Provider any amount
previously paid or advanced by the Indemnity Provider pursuant to this Section
11.1 by way of indemnification or advance for the payment of an amount regarding
such Claim, except reasonable expenses therefrom incurred by such Indemnified
Person in connection with the response to such Claim.
Notwithstanding the foregoing provisions of this Section 11.1, an
Indemnified Person shall not be required to take any action and the Indemnity
Provider shall not be permitted to respond to any Claim in its own name or that
of the Indemnified Person unless (A) the Indemnity Provider shall have agreed to
pay and shall pay to such Indemnified Person on demand and on an After Tax Basis
all reasonable costs, losses and expenses that such Indemnified Person actually
incurs in connection with such Claim, including without limitation all
reasonable legal, accounting and investigatory fees and disbursements and the
Indemnity Provider shall have agreed that the Claim is an indemnifiable Claim
hereunder, (B) in the case of a Claim that must be pursued in the name of an
Indemnified Person (or an Affiliate thereof), the amount of the potential
indemnity (taking into account all similar or logically related Claims that have
been or could be raised for which the Indemnity Provider may be liable to pay an
indemnity under this Section 11.1) exceeds $50,000 (or such lesser amount as may
be subsequently agreed between the Indemnity Provider and the Indemnified
Person), (C) the Indemnified Person shall have reasonably determined that the
action to be taken will not result in any material danger of sale, forfeiture or
loss of the Property, or any part thereof or interest therein, will not
interfere with the payment of Rent, and will not result in risk of criminal
liability, (D) if such Claim shall involve the payment of any amount prior to
the resolution of such Claim, the Indemnity Provider shall provide to the
Indemnified Person an interest-free advance in an amount equal to the amount
that the Indemnified Person is required to pay (with no additional net after-tax
cost to such Indemnified Person) prior to the date such payment is due, (E) in
the case of a Claim that must be pursued in the name of an Indemnified Person
(or an Affiliate thereof), the Indemnity Provider shall have provided to such
Indemnified Person an opinion of independent counsel
70
selected by the Indemnity Provider and reasonably satisfactory to the
Indemnified Person stating that a reasonable basis exists to contest such Claim
(or, in the case of an appeal of an adverse determination, an opinion of such
counsel to the effect that a reasonable basis for such appeal exists) and (F) no
Lease Event of Default shall have occurred and be continuing. In no event shall
an Indemnified Person be required to appeal an adverse judicial determination to
the United States Supreme Court. In addition, an Indemnified Person shall not be
required to contest any Claim in its name (or that of an Affiliate) if the
subject matter thereof shall be of a continuing nature and shall have previously
been decided adversely by a court of competent jurisdiction pursuant to the
contest provisions of this Section 11.1, 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 Indemnity Provider and reasonably acceptable to the Indemnified
Person 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. In no event shall the Indemnity Provider be permitted to adjust or
settle any Claim without the consent of the Indemnified Person to the extent any
such adjustment or settlement involves, or is reasonably likely to involve, any
performance by or adverse admission by or with respect to the Indemnified
Person.
11.2. General Tax Indemnity.
---------------------
(a) The Indemnity Provider shall pay and assume liability
for, and does hereby agree to indemnify, protect and defend the
Property and all Indemnified Persons, and hold them harmless against,
all Impositions on an After Tax Basis, and all payments pursuant to the
Operative Agreements shall be made free and clear of and without
deduction for any and all present and future Impositions.
(b) Notwithstanding anything to the contrary in Section
11.2(a) hereof, the following shall be excluded from the indemnity
required by Section 11.2(a):
(i) Taxes (other than Taxes that are, or are in the
nature of, sales, use, rental, value added, transfer or
property taxes) that are imposed on a Indemnified Person
(other than the Lessor) by the United States federal
government that are based on or measured by the net income
(including without limitation taxes based on capital gains and
minimum taxes) of such Person; provided, that this clause (i)
--------
shall not be interpreted to limit or expand the Indemnity
Provider's obligations with respect to withholdings pursuant
to Section 11.2(e) hereof and shall not be interpreted to
prevent a payment from being made on an After Tax Basis if
such payment is otherwise required to be so made;
(ii) Taxes (other than Taxes that are, or are in the
nature of, sales, use, rental, value added, transfer or
property taxes) that are imposed on any Indemnified Person
(other than the 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 (including
without limitation taxes based on capital gains and minimum
taxes) of such Person or are in the nature of franchise taxes;
provided that such Taxes shall not be excluded under this
--------
subparagraph (ii) to the
71
extent such Taxes would have been imposed had the location,
possession or use of the Property in, the location or the
operation of the Lessee in, or the Lessee's making payments
under the Operative Agreements from, the jurisdiction imposing
such Taxes been the sole connection between such Indemnified
Person and the jurisdiction imposing such Taxes; 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 to the extent it relates to any act,
event or omission that occurs after the termination of the
Lease and redelivery or sale of the Property in accordance
with the terms of the Lease (but not any Tax that relates to
such termination, redelivery or sale and/or to any period
prior to such termination, redelivery or sale); and
(iv) any Taxes which are imposed on an Indemnified
Person as a result of the gross negligence or willful
misconduct of such Indemnified Person itself, as determined by
a court of competent jurisdiction (as opposed to gross
negligence or willful misconduct imputed to such Indemnified
Person), but not Taxes imposed as a result of ordinary
negligence of such Indemnified Person;
(v) Withholdings (as defined in Section 11.2(e)
hereof), provided that Withholdings shall be subject to
indemnification as provided in Section 11.2(e) hereof; and
(vi) Taxes to the extent the Indemnity Provider
receives a credit or reduction in other Impositions that would
not have been realized absent the payment of such Taxes that
are indemnified hereunder.
Notwithstanding the foregoing, the exclusions from the definition of
"Impositions" set forth in clauses (i), (ii) and (iii) shall not apply (but the
other exclusions shall apply) to any Taxes or increase in Taxes imposed on an
Indemnified Person net of any decrease in taxes realized by such Indemnified
Person, to the extent that such tax increase or decrease would not have occurred
if on each date of an Advance the Primary Financing Parties has advanced funds
to the Lessee in the form of a loan secured by the Property in an amount equal
to the Acquisition and Construction Advances funded on such date of an Advance,
with debt service equal to the Basic Rent payable on each Schedule Interest
Payment Date and a principal balance at the maturity of such loan in an amount
equal to the then outstanding amount of the Notes at the end of the term of the
Lease.
(c) (i) Subject to the terms of Section 11.2(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.
72
(ii) In the case of Impositions for which no
contest is conducted pursuant to Section 11.2(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
without limitation the computation of the amount payable),
accompanied by receipts or other reasonable evidence of such
demand. In the case of Impositions for which a contest is
conducted pursuant to Section 11.2(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
11.2(f).
(iii) At the Indemnity Provider's request, the
amount of any indemnification payment by the Indemnity
Provider pursuant to subsection (a) shall be verified and
certified by an independent public accounting firm mutually
acceptable to the Indemnity Provider and the Indemnified
Person. The fees and expenses of such independent public
accounting firm shall be paid by the Indemnity Provider unless
such verification shall result in an adjustment in the
Indemnity Provider's favor of fifteen percent (15%) or more of
the payment as computed by the Indemnified Person, in which
case such fee shall be paid by the Indemnified Person.
(d) The Indemnity Provider shall be responsible for
preparing and filing any real and personal property or ad valorem tax
returns in respect of the 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 prepare and file such report or return)
(A) to the extent required or permitted by and consistent with Legal
Requirements, make and file in the 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) no later than fifteen (15) days prior to the due
date thereof. Such Indemnified Person shall, upon the Indemnity
Provider's request and at the
73
Indemnity Provider's expense, provide any data maintained by such
Indemnified Person (and not otherwise available to or within the
control of the Indemnity Provider) with respect to each Property which
the Indemnity Provider may reasonably require to prepare any required
tax returns or reports.
(e) As between the Indemnity Provider on one hand, and each
Financing Party on the other hand, the Indemnity Provider shall be
responsible for, and the Indemnity Provider shall indemnify and hold
harmless each Financing Party (without duplication of any
indemnification required by subsection (a)) on an After Tax Basis
against, any obligation for United States or foreign withholding taxes
or similar levies, imposts, charges, fees, deductions or withholdings
(collectively, "Withholdings") imposed in respect of the interest
------------
payable on the Notes or with respect to any other payments under the
Operative Agreements (all such payments being referred to herein as
"Exempt Payments" to be made without deduction, withholding or set off)
---------------
(and, if any Financing Party receives a demand for such payment from
any taxing authority or a Withholding is otherwise required with
respect to any Exempt Payment, the Indemnity Provider shall discharge
such demand on behalf of such Financing Party); provided, however, that
-------- -------
the obligation of the Indemnity Provider under this Section 11.2(e)
shall not apply to:
(i) Withholdings on any Exempt Payment to any
Financing Party which is a non-U.S. Person unless such
Financing Party is, on the date hereof (or on the date it
becomes a Financing Party hereunder) and on the date of any
change in the principal place of business or the lending
office of such Financing Party, entitled to submit a Form W-
8BEN or Form W-8ECI or successor applicable form, certifying
in each case that such party is entitled under Section 1442 of
the Code or any other applicable provision thereof or under
any applicable tax treaty or convention to receive payments
pursuant to the Operative Agreements without deduction or
withholding of United States federal income tax and is a
foreign Person thereby entitled to an exemption from United
States backup withholding taxes (except where the failure of
the exemption results from a change in the principal place of
business of the Lessee); provided however, if a failure of the
-------- -------
exemption is due to a change in law after the date hereof or
in the case of a Financing Party that acquires its interest
after the date hereof, a change in law occurring after such
date, then the Indemnity Provider shall be liable for
withholding resulting therefrom; or
(ii) Any U.S. Taxes imposed solely by reason of
the failure by a non-U.S. Person to comply with applicable
certification, information, documentation or other reporting
requirements concerning the nationality, residence, identity
or connections with the United States of America of such non-
U.S. Person if such compliance is required by statute or
regulation of the United States of America as a precondition
to relief or exemption from such U.S. Taxes if the Indemnity
Provider has provided such certification, information,
documentation or other reporting requirements to the Financing
Party and the Financing Party is eligible for such relief or
exemption.
74
For the purposes of this Section 11.2(e), (A) "U.S. Person" shall mean
-----------
a citizen, national or resident of the United States of America, a
corporation, partnership or other entity created or organized in or
under any laws of the United States of America or any State thereof, or
any estate or trust that is subject to Federal income taxation
regardless of the source of its income, (B) "U.S. Taxes" shall mean any
----------
present or future tax, assessment or other charge or levy imposed by or
on behalf of the United States of America or any taxing authority
thereof or therein, (C) "Form W-8BEN" shall mean Form W-8BEN
(Certificate of Foreign Status of Beneficial Owner for United States
Withholding) of the Department of the Treasury of the United States of
America and (D) "Form W-8ECI" shall mean Form W-8ECI (Certificate of
Foreign Person's Claim for Exemption from Withholding on Income
Effectively Connected with the Conduct of a Trade or Business in the
United States) of the Department of the Treasury of the United States
of America (or in relation to either such Form such successor and
related forms as may from time to time be adopted by the relevant
taxing authorities of the United States of America to document a claim
to which such Form relates). Each of the Forms referred to in the
foregoing clauses (C) and (D) shall include such successor and related
forms as may from time to time be adopted by the relevant taxing
authorities of the United States of America to document a claim to
which such Form relates.
If a Financing Party or an Affiliate with whom such Financing
Party files a consolidated tax return (or equivalent) subsequently
receives the benefit in any country of a tax credit or an allowance
resulting from U.S. Taxes with respect to which it has received a
payment of an additional amount under this Section 11.2(e), such
Financing Party will pay to the Indemnity Provider such part of that
benefit as in the opinion of such Financing Party will leave it (after
such payment) in a position no more and no less favorable than it would
have been in if no additional payment had been required to be paid,
provided always that (i) such Financing Party will be the sole judge of
--------
the amount of any such benefit and of the date on which it is received,
(ii) such Financing Party will have the absolute discretion as to the
order and manner in which it employs or claims tax credits and
allowances available to it and (iii) such Financing Party will not be
obliged to disclose to the Borrower any information regarding its tax
affairs or tax computations. A subsequent loss of such tax credit or
allowance with respect to which a payment is made pursuant to this
paragraph to an Indemnity Provider shall be treated as an Imposition
that is indemnifiable under Section 11.2(a) hereof without regard to
the exclusions of Section 11.2(b) (i), (ii) and (iii) hereof.
Each non-U.S. Person that shall become a Financing Party after
the date hereof shall, upon the effectiveness of the related transfer
or otherwise upon becoming a Financing Party hereunder, be required to
provide all of the forms and statements referenced above or other
evidences of exemption from Withholdings if the Indemnity Provider has
provided such certification, information, documentation or other
reporting requirements to the Financing Party and the Financing Party
is eligible for such relief or exemption.
(f) If a written Claim is made against any Indemnified
Person or if any proceeding shall be commenced against such Indemnified
Person (including without
75
limitation a written notice of such proceeding), for any Impositions,
the provisions in Section 11.1 relating to notification and rights to
contest shall apply; provided, however, that the Indemnity Provider
-------- -------
shall have the right to conduct and control such contest only if such
contest involves a Tax other than a Tax on net income of the
Indemnified Person that can be pursued independently from any other
proceeding involving a Tax liability of such Indemnified Person.
11.3. Increased Costs, Illegality, etc.
--------------------------------
(a) If, due to either (i) the introduction of or any change
in or in the interpretation of any law or regulation after the Closing
Date or (ii) the compliance with any guideline or request hereafter
adopted, promulgated or made by any central bank or other governmental
authority (whether or not having the force of law), there shall be any
increase in the cost to any Financing Party of agreeing to make or
making, funding or maintaining Advances, then the Lessee shall from
time to time, upon demand by such Financing Party (with a copy of such
demand to the Agent but, in the case of any Tranche B Lender, subject
to the terms of Section 2.11 of the Credit Agreement), pay to the Agent
for the account of such Financing Party additional amounts sufficient
to compensate such Financing Party for such increased cost on an After
Tax Basis. A certificate as to the amount of such increased cost,
submitted to the Lessee and the Agent by such Financing Party, shall be
conclusive and binding for all purposes, absent manifest error.
(b) If any Financing Party determines that compliance with
any law or regulation or any guideline or request from any central bank
or other governmental authority (whether or not having the force of
law, but in each case promulgated or made after the date hereof)
affects or would affect the amount of capital required or expected to
be maintained by such Financing Party or any corporation controlling
such Financing Party and that the amount of such capital is increased
by or based upon the existence of such Financing Party's commitment to
make Advances or upon the Advances, then, upon demand by such Financing
Party (with a copy of such demand to the Agent but, in the case of any
Tranche B Lender, subject to the terms of Section 2.11 of the Credit
Agreement), the Lessee shall pay to the Agent for the account of such
Financing Party, from time to time as specified by such Financing
Party, additional amounts sufficient to compensate such Financing Party
or such corporation on an After Tax Basis in the light of such
circumstances, to the extent that such Financing Party reasonably
determines such increase in capital to be allocable to the existence of
such Financing Party's commitment to make such Advances. A certificate
as to such amounts submitted to the Lessee and the Agent by such
Financing Party shall be conclusive and binding for all purposes,
absent manifest error.
(c) [Reserved].
(d) Without affecting its rights under Sections 11.3(a) or
11.3(b) or any other provision of any Operative Agreement, each
Financing Party agrees that if there is any increase in any cost to or
reduction in any amount receivable by such Financing Party with respect
to which the Lessee would be obligated to compensate such Financing
Party
76
pursuant to Sections 11.3(a) or 11.3(b), such Financing Party shall use
reasonable efforts to select an alternative office for Advances which
would not result in any such increase in any cost to or reduction in
any amount receivable by such Financing Party; provided, however, that
-------- -------
no Financing Party shall be obligated to select an alternative office
for Advances if such Financing Party determines that (i) as a result of
such selection such Financing Party would be in violation of any
applicable law, regulation, treaty, or guideline, or would incur
additional costs or expenses or (ii) such selection would be
inadvisable for regulatory reasons or materially inconsistent with the
interests of such Financing Party.
(e) With reference to the obligations of the Lessee set
forth in Sections 11.3(a) through 11.3(d), the Lessee shall not have
any obligation to pay to any Financing Party amounts owing under such
Sections for any period which is more than one (1) year prior to the
date upon which the request for payment therefor is delivered to the
Lessee.
(f) Notwithstanding any other provision of this Agreement,
if any Tranche B Lender shall notify the Agent and the Agent shall
notify the Borrower and the Lessee that the introduction of or any
change in or in the interpretation of any law or regulation makes it
unlawful, or any central bank or other governmental authority asserts
that it is unlawful, for any Tranche B Lender to perform its
obligations hereunder and under the other Operative Agreements to make
or maintain Eurodollar Loans then (i) each Eurodollar Loan will
automatically, at the earlier of the end of the Interest Period for
such Eurodollar Loan or the date required by law, convert into an ABR
Loan and (ii) the obligation of such Tranche B Lender to make, convert
or continue Eurodollar Loans shall be suspended until the Agent shall
notify the Lessee that such Tranche B Lender has determined that the
circumstances causing such suspension no longer exist.
11.4. Funding/Contribution Indemnity.
------------------------------
Subject to the provisions of Section 2.11(a) of the Credit Agreement,
the Lessee agrees to indemnify each Tranche B Lender and to hold each Tranche B
Lender harmless from any loss or reasonable expense which such Tranche B Lender
may sustain or incur as a consequence of (a) any default by the Construction
Agent in connection with the drawing of funds for any Advance, (b) any default
in making any prepayment after a notice thereof has been given in accordance
with the provisions of the Operative Agreements or (c) the making of a voluntary
or involuntary payment of Eurodollar Loans on a day which is not the last day of
an Interest Period with respect thereto. The Lessee agrees to indemnify each
Tranche A Note Purchaser and to hold each Tranche A Note Purchaser harmless from
any loss or reasonable expense which such Tranche A Note Purchaser may sustain
or incur as a consequence of the making of a voluntary or involuntary payment of
any Tranche A Note on a day which is not the Maturity Date. Such indemnification
shall be (I) respecting Tranche B Loans, in an amount equal to the excess, if
any, of (x) the amount of interest which would have accrued on the amount so
paid, or not so borrowed, accepted, converted or continued for the period from
the date of such payment or of such failure to borrow, accept, convert or
continue to the last day of such Interest Period (or, in the case of a failure
to borrow, accept, convert or continue, the Interest Period that would have
commenced on the date of such failure) in each case at the applicable Eurodollar
Rate plus the
77
Applicable Percentage for such Loan for such Interest Period over (y) the amount
of interest (as determined by such Financing Party in its reasonable discretion)
which would have accrued to such Financing Party on such amount by reemploying
such funds in loans of the same type and amount during the period from the date
of payment or failure to borrow to the last day of the then applicable Interest
Period (or, in the case of a failure to borrow, the Interest Period that would
have commenced on the date of such failure) and (II) respecting the Tranche A
Notes, the Make-Whole Amount. This covenant shall survive the termination of the
Operative Agreements and the payment of all other amounts payable hereunder.
11.5. EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE, STRICT
-------------------------------------------------------
LIABILITY, ETC.
--------------
WITHOUT LIMITING THE GENERALITY OF THE INDEMNIFICATION PROVISIONS OF
ANY AND ALL OF THE OPERATIVE AGREEMENTS AND TO THE EXTENT PERMITTED BY
APPLICABLE LAW, EACH PERSON PROVIDING INDEMNIFICATION OF ANOTHER PERSON UNDER
ANY OPERATIVE AGREEMENT HEREBY FURTHER EXPRESSLY RELEASES EACH BENEFICIARY OF
ANY SUCH INDEMNIFICATION FROM ALL CLAIMS FOR LOSS OR DAMAGE, DESCRIBED IN ANY
OPERATIVE AGREEMENT, CAUSED BY ANY ACT OR OMISSION ON THE PART OF ANY SUCH
BENEFICIARY ATTRIBUTABLE TO THE ORDINARY NEGLIGENCE (WHETHER SOLE OR
CONTRIBUTORY) OR STRICT LIABILITY OF ANY SUCH BENEFICIARY, AND INDEMNIFIES,
EXONERATES AND HOLDS EACH SUCH BENEFICIARY FREE AND HARMLESS FROM AND AGAINST
ANY AND ALL ACTIONS, CAUSES OF ACTION, SUITS, CLAIMS, LOSSES, COSTS,
LIABILITIES, DAMAGES AND EXPENSES (INCLUDING WITHOUT LIMITATION REASONABLE
ATTORNEY'S FEES AND EXPENSES), DESCRIBED ABOVE, INCURRED BY ANY SUCH BENEFICIARY
(IRRESPECTIVE OF WHETHER ANY SUCH BENEFICIARY IS A PARTY TO THE ACTION FOR WHICH
INDEMNIFICATION UNDER THIS AGREEMENT OR ANY OTHER OPERATIVE AGREEMENT IS SOUGHT)
ATTRIBUTABLE TO THE ORDINARY NEGLIGENCE (WHETHER SOLE OR CONTRIBUTORY) OR STRICT
LIABILITY OF ANY SUCH BENEFICIARY.
11.6. Additional Provisions Regarding Environmental Indemnification.
-------------------------------------------------------------
Without limiting the generality of Section 11.1, each and every
Indemnified Person shall at all times have the rights and benefits, and the
Indemnity Provider shall have the obligations, in each case provided pursuant to
the Operative Agreements with respect to environmental matters, violations of
any Environmental Law, any Environmental Claim or other loss of or damage to any
property or the environment relating to the Property, the Lease, the Agency
Agreement or the Indemnity Provider (including without limitation the rights and
benefits provided pursuant to Section 11.1(c)).
78
11.7. Indemnity Prior to Completion Date.
----------------------------------
Notwithstanding the provisions of Sections 11.1, 11.2, 11.3, 11.4, 11.5 and
11.6 (other than with respect to matters concerning indemnification for
environmental conditions existing on or before the Closing Date) and any other
indemnity obligations of the Indemnity Provider under the Operative Agreements,
(a) the Lessor shall be the only beneficiary of the provisions set forth in
Sections 11.1, 11.2, 11.3, 11.4, 11.5 and 11.6 (again, subject to the
immediately preceding parenthetical phrase) and any other indemnity obligations
of the Indemnity Provider under the Operative Agreements with respect to any
Claim arising thereunder solely for the period prior to the Completion Date
related to the Property, and (b) such limited rights of indemnification
referenced in Section 11.7(a) (to the extent relating to third-party claims)
shall be limited to third-party claims caused by or resulting from the Indemnity
Provider's acts or omissions and/or all other Persons acting by, through or
under the Indemnity Provider (including, without limitations, contractors,
subcontractors and other Persons contracted or controlled by the Construction
Agent). After the Completion Date for the Property, each Indemnified Person
shall be a beneficiary of the provisions set forth in Sections 11.1 through
11.6.
To the extent the Indemnity Provider is not obligated to indemnify any
Indemnified Person with respect to Claims arising under Sections 11.1, 11.2,
11.3, 11.4, 11.5 or 11.6 and any other indemnity obligations of the Indemnity
Provider under the Operative Agreements prior to the Completion Date, the Lessor
shall provide such indemnities in favor of such Indemnified Person in accordance
with the relevant provisions of Sections 11.1, 11.2, 11.3, 11.4, 11.5 or 11.6
and any other indemnity obligations of the Indemnity Provider under the
Operative Agreements as the case may be. It is acknowledged and agreed that any
amount for which the Lessor becomes obligated to any Indemnified Person pursuant
hereto shall become a Claim for which the Lessor is entitled to indemnity from
the Indemnity Provider pursuant to the preceding paragraph.
THE INDEMNITY OBLIGATIONS UNDERTAKEN BY THE LESSOR PURSUANT TO THIS SECTION
11.7 ARE IN ALL RESPECTS SUBJECT TO THE LIMITATIONS ON LIABILITY REFERENCED IN
SECTION 12.9.
SECTION 12. MISCELLANEOUS.
12.1. 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 the Property to the Lessor, the acquisition
of the Property (or any of its components), the construction of any
Improvements, the Completion of the Property, any disposition of any interest of
the Lessor in the Property, 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,
79
the indemnities of the parties provided for in the Operative Agreements shall
survive the expiration or termination of any thereof with respect to matters
occurring prior to such expiration or termination.
12.2. Notices.
-------
All notices required or permitted to be given under any Operative Agreement
shall be in writing. Notices may be served by certified or registered mail,
postage paid with return receipt requested; by private courier, prepaid; by
telex, facsimile, or other telecommunication device capable of transmitting or
creating a written record; or personally. Mailed notices shall be deemed
delivered five (5) days after mailing, properly addressed. Couriered notices
shall be deemed delivered when delivered as addressed, or if the addressee
refuses delivery, when presented for delivery notwithstanding such refusal.
Telex or telecommunicated notices shall be deemed delivered when receipt is
either confirmed by confirming transmission equipment or acknowledged by the
addressee or its office. Personal delivery shall be effective when accomplished.
Unless a party changes its address by giving notice to the other party as
provided herein, notices shall be delivered to the parties at the following
addresses:
If to the Construction Agent, the Lessee or any Guarantor, to such
entity at the following address:
c/o Capital One Services, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Director of Corporate Funding
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Borrower or the Lessor, to such entity at the following
address:
First Union Development Corporation
c/o First Union Securities, Inc.
One First Union Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
80
If to the Agent, to it at the following address:
First Union National Bank
c/o First Union Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Escrow Agent, to it at the following address:
First Union National Bank
CMG/Corporate Trust Group - VA 3279
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
If to any Primary Financing Party, to it at the address set forth for
such Primary Financing Party in Exhibit A to the Note Purchase Agreement or
---------
in Schedule 2.1 of the Credit Agreement, as applicable.
------------
From time to time any party may designate additional parties and/or
another address for notice purposes by notice to each of the other parties
hereto. Each notice hereunder shall be effective upon receipt or refusal
thereof.
12.3. 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 (1) and the same
instrument.
12.4. Terminations, Amendments, Waivers, Etc.; Unanimous Vote Matters.
---------------------------------------------------------------
Each Operative Agreement may be terminated, amended, supplemented, waived
or modified only by an instrument in writing signed by the Agent (as directed by
the Secured Parties in accordance with the terms of the Intercreditor
Agreement), the Lessor and each Credit Party (to the extent such Credit Party is
a party to such Operative Agreement); provided, to the extent no Lease Default
--------
under Sections 17.1(a), (b), (g), (h) and (j) of the Lease or Lease Event of
Default shall have occurred and be continuing, the Agent and the Lessor shall
not amend, supplement, waive or modify any provision of any Operative Agreement
in such a manner as to adversely affect the rights of any Credit Party without
the prior written consent (not to be unreasonably withheld or delayed) of such
Credit Party.
81
12.5. 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.
12.6. 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.
12.7. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL;
---------------------------------------------------------------
VENUE.
-----
(a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED, INTERPRETED AND ENFORCED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING
EFFECT TO THE PRINCIPLES THEREOF RELATING TO CONFLICTS OF LAW), EXCEPT TO
THE EXTENT THE LAWS OF THE STATE WHERE THE PROPERTY IS LOCATED ARE REQUIRED
TO APPLY. Any legal action or proceeding with respect to this Agreement or
any other Operative Agreement may be brought in the courts of the State of
New York or of the United States for the Southern District of New York,
and, by execution and delivery of this Agreement, each of the parties to
this Agreement hereby irrevocably accepts for itself and in respect of its
property, generally and unconditionally, the nonexclusive jurisdiction of
such courts. Each of the parties to this Agreement further irrevocably
consents to the service of process out of any of the aforementioned courts
in any such action or proceeding by the mailing of copies thereof by
registered or certified mail, postage prepaid, to it at the address set out
for notices pursuant to Section 12.2, such service to become effective five
(5) days after such mailing. Nothing herein shall affect the right of any
party to serve process in any other manner permitted by Law or to commence
legal proceedings or to otherwise proceed against any party in any other
jurisdiction permitted by Law.
(b) EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY,
TO THE FULLEST EXTENT ALLOWED BY APPLICABLE LAW, WAIVES TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO ANY DISPUTE OR THIS AGREEMENT,
ANY OTHER OPERATIVE AGREEMENT AND FOR ANY COUNTERCLAIM THEREIN.
(c) Each of the parties to this Agreement hereby irrevocably
waives any objection which it may now or hereafter have to the laying of
venue of any of the aforesaid actions or proceedings arising out of or in
connection with this Agreement or any other Operative Agreement brought in
the courts referred to in subsection (a) above and hereby further
irrevocably waives and agrees not to plead or claim in any such court
82
that any such action or proceeding brought in any such court has been
brought in an inconvenient forum.
Subject to the other applicable provisions of the Operative Agreements, the
parties shall have the right to proceed in any court of proper jurisdiction or
by self-help to exercise or prosecute the following remedies after the
occurrence and during the continuance of a Lease Event of Default, as
applicable: (i) all rights to foreclose against any real or personal property or
other security by exercising a power of sale or under applicable law by judicial
foreclosure including a proceeding to confirm the sale; (ii) all rights of self-
help including peaceful occupation of real property and collection of rents,
set-off and peaceful possession of personal property; (iii) obtaining
provisional or ancillary remedies including injunctive relief, sequestration,
garnishment, attachment, appointment of receiver and filing an involuntary
bankruptcy proceedings; and (iv) when applicable, a judgment by confession of
judgment. Any claim or controversy with regard to any party's entitlement to
such remedies is a Dispute.
Each party to this Agreement agrees that it shall not have a remedy of
punitive or exemplary damages against any other party in any Dispute and hereby
waives any right or claim to punitive or exemplary damages it has now or which
may arise in the future in connection with any Dispute.
12.8. Severability.
------------
Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
12.9. Liability Limited.
-----------------
(a) [Reserved].
(b) Anything to the contrary contained in this Agreement, the
Credit Agreement, the Notes or in any other Operative Agreement
notwithstanding, no Exculpated Person shall be personally liable in any
respect for any liability or obligation arising hereunder or in any other
Operative Agreement including without limitation the payment of the
principal of, or interest on, the Notes, or for monetary damages for the
breach of performance of any of the covenants contained in the Credit
Agreement, the Notes, this Agreement, the Security Agreement or any of the
other Operative Agreements. The Primary Financing Parties and the Agent
agree that, in the event any remedies under any Operative Agreement are
pursued, neither the Primary Financing Parties 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 Borrower's Interest (excluding
Excepted Payments) and the Credit Parties (with respect to the Credit
Parties' obligations under the Operative Agreements); but nothing contained
herein shall be taken to prevent
83
recourse against or the enforcement of remedies against the Borrower's
Interest (excluding Excepted Payments) in respect of any and all
liabilities, obligations and undertakings contained herein and/or in any
other Operative Agreement. Notwithstanding the provisions of this Section,
nothing in any Operative Agreement shall: (i) constitute a waiver, release
or discharge of any indebtedness or obligation evidenced by the Notes
arising under any Operative Agreement or secured by any Operative
Agreement, but the same shall continue until paid or discharged; (ii)
relieve any Exculpated Person from liability and responsibility for (but
only to the extent of the damages arising by reason of): active waste
knowingly committed by any Exculpated Person with respect to the Property,
any fraud, gross negligence or willful misconduct on the part of any
Exculpated Person; (iii) relieve any Exculpated Person from liability and
responsibility for (but only to the extent of the moneys misappropriated,
misapplied or not turned over) (A) except for Excepted Payments,
misappropriation or misapplication by the Lessor (i.e., application in a
manner contrary to any of the Operative Agreements) of any insurance
proceeds or condemnation award paid or delivered to the Lessor by any
Person other than the Agent, (B) except for Excepted Payments, any deposits
or any escrows or amounts owed by the Construction Agent under the Agency
Agreement held by the Lessor or (C) except for Excepted Payments, any rent
or other income or funds received by the Lessor from any Credit Party that
is 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 rights and powers of the Agent under the Operative Agreements
or to obtain a judgment against the Lessee's interest in the Property
pursuant to the terms of the Operative Agreements or the Agent's rights and
powers to obtain a judgment against the Lessor or any Credit Party
(provided, that no deficiency judgment or other money judgment shall be
--------
enforced against any Exculpated Person except to the extent of the Lessor's
interest in the Borrower's Interest (excluding Excepted Payments) or to the
extent the Lessor may be liable as otherwise contemplated in clauses (ii)
and (iii) of this Section 12.9(b)).
12.10. Rights of the Credit Parties.
----------------------------
If at any time all obligations (i) of the Borrower under the Credit
Agreement, the Notes, the Security Documents and the other Operative Agreements
and (ii) of the Credit Parties under the Operative Agreements have in each case
been satisfied or discharged in full, then the Credit Parties shall be entitled
to (a) terminate the Lease and guaranty obligations under the Guaranty and (b)
receive all amounts then held under the Operative Agreements and all proceeds
with respect to the Property. Upon the termination of the Lease and the Guaranty
pursuant to the foregoing clause (a), the Lessor shall transfer to the Lessee or
its designee all of its right, title and interest free and clear of the Lien of
the Lease, the Lien of the Security Documents and all other Operative Agreements
and all Lessor Liens in and to the Property and any amounts or proceeds referred
to in the foregoing clause (b) shall be paid over to the Lessee or its designee.
12.11. 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
84
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, filings of
Mortgage Instruments 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 without limitation any action
specified in the preceding sentence), or (if the Lessor shall so request) as so
requested, in order to maintain and protect all security interests provided for
hereunder or under any other Operative Agreement. In addition, in connection
with the sale or other disposition of the Property or any portion thereof, the
Lessee agrees to execute such instruments of conveyance as reasonably required
pursuant to the Operative Agreements in connection therewith.
12.12. Calculations under Operative Agreements.
---------------------------------------
The parties hereto agree that all calculations and numerical determinations
to be made under the Operative Agreements by the Lessor 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, provided that
all such calculations affecting the Lessee, or the rights or obligations of the
Lessee, shall be promptly provided to the Lessee in writing.
12.13. Confidentiality.
---------------
Each Financing Party severally agrees to use reasonable efforts to keep
confidential all non-public information pertaining to any Credit Party or any of
its Subsidiaries which is provided to it by any Credit Party or any of its
Subsidiaries and which an officer of any Credit Party or any of its Subsidiaries
has requested in writing be kept confidential, and shall not intentionally
disclose such information to any Person except:
(a) to the extent such information is public when received by
such Person or becomes public thereafter due to the act or omission of any
party other than such Person;
(b) to the extent such information is lawfully and independently
obtained from a source other than any Credit Party 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 counsel, auditors or accountants retained by any such
Person or any Affiliates of any such Person (if such Affiliates are
permitted to receive such information pursuant to clause (f) or (g) below),
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 Financing Party or any Affiliate
thereof in the course of examinations of such Persons;
85
(d) in connection with any litigation or the enforcement or
preservation of the rights of any Financing Party under the Operative
Agreements;
(e) to the extent, and only 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 (including, but not limited to, the National Association of
Insurance Commissioners); provided, however, that such Person shall
-------- -------
endeavor (if not otherwise prohibited by Law) to notify the Lessee prior to
any disclosure made pursuant to this clause (e), except that no such Person
shall be subject to any liability whatsoever for any failure to so notify
the Lessee;
(f) any Financing Party may disclose such information to another
Financing Party or to any Affiliate of a Financing Party that is a direct
or indirect owner of any Financing Party (provided, in each case that such
--------
Affiliate has agreed to maintain confidentiality as if it were such
Financing Party);
(g) any Financing Party may disclose such information to an
Affiliate of any Financing Party to the extent required in connection with
the transactions contemplated hereby or to the extent such Affiliate is
involved in, or provides advice or assistance to such Person with respect
to, such transactions (provided, in each case that such Affiliate has
--------
agreed to maintain confidentiality as if it were such Financing Party);
(h) in connection with any proposed or actual assignment or
grant of a participation by any of the Primary Financing Parties of
interests in the Note Purchase Agreement, the Credit Agreement or any Note
to such other financial institution (who shall in turn agree in writing to
maintain confidentiality as if it were a Primary Financing Party originally
party to this Agreement); or
(i) any Financing Party may disclose the Operative Agreements to
any rating agency requesting the same.
Subject to the terms of Sections 12.13(a)-12.13(i), under the terms of any
one or more of which circumstances disclosure shall be permitted, each Financing
Party severally agrees to use reasonable efforts to keep confidential all non-
public information pertaining to the financing structure described in the
unrecorded Operative Agreements.
12.14. Financial Reporting/Tax Characterization.
----------------------------------------
Lessee agrees to obtain advice from its own accountants and tax counsel
regarding the financial reporting treatment and the tax characterization of the
transactions described in the Operative Agreements. Lessee further agrees that
Lessee shall not rely upon any statement of any Financing Party or any of their
respective Affiliates and/or Subsidiaries regarding any such financial reporting
treatment and/or tax characterization.
86
12.15. Set-off.
-------
In addition to any rights now or hereafter granted under applicable Law and
not by way of limitation of any such rights, after the occurrence of any Lease
Event of Default and during the continuance thereof, the Primary Financing
Parties, the Lessor and any assignee of a Primary Financing Party or the Lessor
in accordance with the applicable provisions of the Operative Agreements are
hereby authorized by the Credit Parties at any time or from time to time,
without notice to the Credit Parties or to any other Person, any such notice
being hereby expressly waived, to set-off and to appropriate and to apply any
and all deposits (general or special, time or demand, including without
limitation indebtedness evidenced by certificates of deposit, whether matured or
unmatured) and any other indebtedness at any time held or owing by the Primary
Financing Parties, the Lessor, their respective Affiliates or any assignee or
participant of a Primary Financing Party in accordance with the applicable
provisions of the Operative Agreements to or for the credit or the account of
any Credit Party against and on account of the obligations of any Credit Party
under the Operative Agreements irrespective of whether or not (a) the Primary
Financing Parties or the Lessor shall have made any demand under any Operative
Agreement or (b) the Agent shall have declared any or all of the obligations of
any Credit Party under the Operative Agreements to be due and payable and
although such obligations shall be contingent or unmatured. Notwithstanding the
foregoing, neither the Agent nor any other Financing Party shall exercise, or
attempt to exercise, any right of setoff, banker's lien, or the like, against
any deposit account or property of any Credit Party held by the Agent or any
other Financing Party, without the prior written consent of the Agent (acting
upon the direction of the Secured Parties in accordance with the Intercreditor
Agreement). The contractual restriction on the exercise of setoff rights
provided in the foregoing sentence is solely for the benefit of the Agent and
the Financing Parties and may not be enforced by any Credit Party.
12.16. Lease Senior.
------------
Anything contained herein or in any of the other Operative Agreements to
the contrary notwithstanding, provided no Lease Event of Default shall have
occurred and be continuing, in each case whether or not the Lease (or a
memorandum thereof) is recorded, or if it is recorded, whether or not it is
recorded prior to the recordation of any of the other Operative Agreements, (i)
the rights of Lessee under the Lease are prior and senior to any Lien created
under or pursuant to this Agreement or any of the other Operative Agreements and
the rights of the Lessor, the Agent and the Primary Financing Parties hereunder
or thereunder, (ii) Lessee's tenancy under the Lease shall not be disturbed nor
shall the Lease be affected by any Default or Event of Default under this
Agreement or any of the other Operative Agreements (other than a Lease Event of
Default), (iii) in the event of a foreclosure or other enforcement of any such
other Operative Agreement, or sale in lieu thereof, the purchaser at such
foreclosure sale or pursuant to a deed in lieu thereof shall be bound to Lessee
for the Term of the Lease and any extensions thereof, (iv) the rights of Lessee
under the Lease shall expressly survive and the Lease shall in all respects
continue in full force and effect, and (v) Lessee shall not be named as a party
defendant in any such foreclosure suit, except as may be required by law. In the
event and during the continuance of a Lease Event of Default, the Lease and the
rights of Lessee and the Lessor thereunder are subordinated to any Lien created
under or pursuant to this Agreement or any of the other Operative Agreements.
87
[signature pages follow]
88
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized as of the
day and year first above written.
CONSTRUCTION AGENTS
AND LESSEES: CAPITAL ONE BANK
By: ______________________________
Name: ____________________________
Title: ___________________________
CAPITAL ONE, F.S.B.
By: ______________________________
Name: ____________________________
Title: ___________________________
GUARANTOR: CAPITAL ONE FINANCIAL CORPORATION
By: ______________________________
Name: ____________________________
Title: ___________________________
BORROWER AND LESSOR: FIRST UNION DEVELOPMENT CORPORATION
By: ______________________________
Name: ____________________________
Title: ___________________________
THE AGENT AND
TRANCHE B LENDERS: FIRST UNION NATIONAL BANK,
as a Tranche B Lender and as the
Agent
By: ______________________________
Name: ____________________________
Title: ___________________________
ESCROW AGENT: FIRST UNION NATIONAL BANK,
as the Escrow Agent
By: ______________________________
Name: ____________________________
Title: ___________________________
TRANCHE A NOTE PURCHASERS: TRANSAMERICA LIFE INSURANCE AND
ANNUITY COMPANY
By: ______________________________
Name: ____________________________
Title: ___________________________
MONUMENTAL LIFE INSURANCE COMPANY
By: ______________________________
Name: ____________________________
Title: ___________________________
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
By _____________________________
Name ___________________________
Title __________________________
NEW YORK LIFE INSURANCE COMPANY
By _____________________________
Name ___________________________
Title __________________________
NEW YORK LIFE INSURANCE AND
ANNUITY CORPORATION
By: New York Life Investment
Management LLC, its Investment
Manager
By _____________________________
Name ___________________________
Title __________________________
MINNESOTA LIFE INSURANCE COMPANY
By: Advantus Capital Management,
Inc.
By _____________________________
Name ___________________________
Title __________________________
FARM BUREAU LIFE INSURANCE COMPANY
OF MICHIGAN
By: Advantus Capital Management,
Inc.
By _____________________________
Name ___________________________
Title __________________________
AMERICAN FIDELITY ASSURANCE
COMPANY
By: Advantus Capital Management,
Inc.
By _____________________________
Name ___________________________
Title __________________________
MTL INSURANCE COMPANY
By: Advantus Capital Management,
Inc.
By _____________________________
Name ___________________________
Title __________________________
INTER-STATE ASSURANCE COMPANY/LIFE
& CAPITAL
By: Advantus Capital Management,
Inc.
By _____________________________
Name ___________________________
Title __________________________
GREAT WESTERN INSURANCE COMPANY
By: Advantus Capital Management,
Inc.
By _____________________________
Name ___________________________
Title __________________________
FARM BUREAU MUTUAL INSURANCE
COMPANY OF MICHIGAN
By: Advantus Capital Management,
Inc.
By _____________________________
Name ___________________________
Title __________________________
FARM BUREAU GENERAL INSURANCE
COMPANY OF MICHIGAN
By: Advantus Capital Management,
Inc.
By _____________________________
Name ___________________________
Title __________________________
EXHIBIT A
REQUISITION FORM
----------------
(Pursuant to Sections 4.2, 5.2, 5.3 and 5.4 of the Participation Agreement)
CAPITAL ONE BANK, a Virginia banking corporation (the "Company"), for
-------
itself and as agent for Capital One, F.S.B., a federal savings bank ("FSB"),
hereby certifies as true and correct and delivers the following Requisition to
FIRST UNION NATIONAL BANK, as the agent for the Primary Financing Parties
(hereinafter defined) and respecting the Security Documents, as the agent for
the Secured Parties (the "Agent"):
-----
Reference is made herein to that certain Participation Agreement dated as
of December 5, 2000 (as amended, modified, extended, supplemented and/or
restated from time to time, the "Participation Agreement") among the Company and
-----------------------
FSB, jointly and severally as the Lessee and as the Construction Agent, and
Capital One Financial Corporation, as the guarantor (the "Guarantor"), First
---------
Union Development Corporation, as the lessor (the "Lessor"), the various
------
financial institutions and other institutional investors which are parties
thereto from time to time as purchasers of Tranche A Notes (the "Tranche A Note
--------------
Purchasers"), the various banks and other lending institutions which are parties
----------
thereto from time to time as lenders (the "Tranche B Lenders") (the Tranche A
-----------------
Note Purchasers and the Tranche B Lenders may be referred to collectively as the
"Primary Financing Parties"), the Agent and First Union National Bank, as the
-------------------------
Escrow Agent (the "Escrow Agent"). Capitalized terms used herein but not
otherwise defined herein shall have the meanings set forth therefor in the
Participation Agreement.
Check one:
____ CLOSING DATE: _________________
(three (3) Business Days prior notice required for Advance)
____ CONSTRUCTION ADVANCE DATE:_____________
(three (3) Business Days prior notice required for Advance)
1. Transaction Expenses and other fees, expenses and disbursements under
Sections 7.1(a) or 7.1(b) of the Participation Agreement and any and
all other amounts contemplated to be financed under the Participation
Agreement including without limitation any Work, broker's fees, taxes,
recording fees and the like: See attached Schedule 1.
2. Description of Land (which shall be a legal description of the Land
subject to the Ground Lease): See attached Schedule 2
3. Description of Equipment (other than Fixtures): See attached Schedule
3.
A-1
4. Aggregate Loans and disbursements from the Escrow Account requested
since the Closing Date with respect to the Property, including without
limitation all amounts requested under this Requisition:
Amount Drawn Prior to Current Requisition: $_______ (a)
Current Draw for Project Costs: $_______ (b)
A-Note Interest on Escrow Principal (Fixed): $_______ (c)
Calculation of Non-GAAP Expense for Current Period:
A-Note Interest on Drawn Balance $_______ (d)
A-Note Interest on Undrawn Balance $_______ (e)
Less Returns on Reinvested Funds $_______ (f)
Tranche A Non-GAAP Interest Expense (e-f) $_______ (g)
Other Non-GAAP Expenses (itemize) $_______ (h)
Total Non-GAAP Expenses (g + h) $_______ (i)
B-Loan Interest for Current Period $_______ (j)
Calculation of A-Note Request = 75% (b+d+j)
Calculation of B-Loan Request = 25% (b+d+j) + i
In connection with this Requisition, the Company hereby requests that
the Tranche B Lenders make Loans to the Lessor in the amount of $______________
and that the Agent disburse Tranche A Proceeds from the Escrow Account in the
amount of $________________. The Company hereby certifies (i) that the foregoing
amounts requested do not exceed the total aggregate of the Available Tranche B
Lender Commitments plus Tranche A Proceeds currently on deposit in the Escrow
Account and (ii) each of the provisions of the Participation Agreement
applicable to the Tranche B Loans and disbursements of Tranche A Proceeds from
the Escrow Account requested hereunder have been complied with as of the date of
this Requisition.
The Company requests the Tranche B Loans be allocated as follows:
$______________ ABR Loans
$______________ Eurodollar Loans
5. Each and every representation and warranty of each Credit Party
contained in the Operative Agreements to which it is a party is true
and correct on and as of the date hereof (except to the extent any
such representation or warranty relates to an earlier date, in which
case such representation or warranty shall have been true and correct
as of such earlier date).
6. No Lease Default or Lease Event of Default has occurred and is
continuing under any Operative Agreement, and no Lease Default or
Lease Event of Default will occur under
A-2
any of the Operative Agreements as a result of, or after giving effect to,
the Advance requested hereby on the date of such Advance.
7. Each Operative Agreement to which any Credit Party is a party is in full
force and effect with respect to it, except as the same may be limited by
applicable bankruptcy, insolvency, fraudulent transfer or conveyance,
reorganization, moratorium or other similar laws relating to or affecting
creditors' or lessors' rights generally and general principles of equity.
8. Each Credit Party has duly performed and complied with all covenants,
agreements and conditions contained in the Participation Agreement or in
any Operative Agreement required to be performed or complied with by it on
or prior to the date hereof.
9. After giving effect to the Advance requested in this Requisition, the sum
of the Available Tranche B Lender Commitments plus the balance of funds in
the Escrow Account will be sufficient to complete the Improvements.
The Company has caused this Requisition to be executed by its duly
authorized officer as of this _____ day of __________, ______.
CAPITAL ONE BANK
By:__________________________________
Name:________________________________
Title:_______________________________
Acknowledged as of _________________.
FIRST UNION NATIONAL BANK, as Agent
By:_________________________________
Name:_______________________________
Title:______________________________
A-3
Schedule 1
----------
[Schedule of Transaction Expense and other Fees]
A-4
Schedule 2
----------
Description of Land
(Legal Description and Street Address)
A-5
Schedule 3
----------
Description of Equipment (other than Fixtures)
A-6
EXHIBIT B
---------
[Reserved]
B-1
EXHIBIT C
---------
[NAME OF CREDIT PARTY]
OFFICER'S CERTIFICATE
---------------------
(Pursuant to Section 5.3(z) of the Participation Agreement)
___________________, a [__________] (the "Company"), DOES HEREBY
CERTIFY as follows:
1. Each and every representation and warranty of each Credit Party
contained in the Operative Agreements to which it is a party is true
and correct on and as of the date hereof, except to the extent any
such representation or warranty relates to an earlier date, in which
case such representation or warranty shall have been true and correct
as of such earlier date.
2. No Lease Default or Lease Event of Default has occurred and is
continuing under any Operative Agreement.
3. Each Operative Agreement to which any Credit Party is a party is in
full force and effect with respect to it, except as the same may be
limited by applicable bankruptcy, insolvency, fraudulent transfer or
conveyance, reorganization, moratorium or other similar laws relating
to or affecting creditors' or lessors' rights generally and general
principles of equity.
4. Each Credit Party has duly performed and complied with all covenants,
agreements and conditions contained in the Participation Agreement
(hereinafter defined) or in any Operative Agreement required to be
performed or complied with by it on or prior to the date hereof.
Capitalized terms used in this Officer's Certificate and not otherwise
defined herein have the respective meanings ascribed thereto in the
Participation Agreement dated as of December 5, 2000 among the Capital One Bank
and Capital One, F.S.B., jointly and severally as the Lessee and as the
Construction Agent, Capital One Financial Corporation, as the Guarantor, First
Union Development Corporation, as the Lessor, the various financial institutions
and other institutional investors which are parties thereto from time to time,
as Tranche A Note Purchasers (the "Tranche A Note Purchasers"), the various
-------------------------
banks and other lending institutions which are parties thereto from time to
time, as Tranche B Lenders (the "Tranche B Lenders"), First Union National Bank,
-----------------
as the agent for the Primary Financing Parties and respecting the Security
Documents, as the agent for the Secured Parties (the "Agent") and First Union
-----
National Bank, as the escrow agent (the "Escrow Agent").
------------
C-1
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be
duly executed and delivered as of this _____ day of __________, ______.
By:___________________________
Name:_________________________
Title:________________________
C-2
EXHIBIT D
---------
[NAME OF CREDIT PARTY]
SECRETARY'S CERTIFICATE
-----------------------
(Pursuant to Section 5.3(aa) of the Participation Agreement)
[NAME OF CREDIT PARTY], a [__________] corporation (the "Company") DOES
-------
HEREBY CERTIFY as follows:
1. Attached hereto as Schedule 1 is a true, correct and complete
----------
copy of the resolutions of the Board of Directors of the
Company duly adopted by the Board of Directors of the Company
on __________. Such resolutions have not been amended,
modified or rescinded since their date of adoption and remain
in full force and effect as of the date hereof.
2. Attached hereto as Schedule 2 is a true, correct and complete
----------
copy of the Articles of Incorporation of the Company on file
in the Office of the Secretary of State of __________. Such
Articles of Incorporation have not been amended, modified or
rescinded since their date of adoption and were in full force
and effect on the date of the resolutions referenced in
paragraph 1 and remain in full force and effect as of the date
hereof.
3. Attached hereto as Schedule 3 is a true, correct and complete
----------
copy of the Bylaws of the Company. Such Bylaws have not been
amended, modified or rescinded since their date of adoption
and remain in full force and effect as of the date hereof.
4. The persons named below now hold the offices set forth
opposite their names, and the signatures opposite their names
and titles are their true and correct signatures.
Name Office Signature
______________________ ____________________ _____________________
______________________ ____________________ _____________________
D-1
IN WITNESS WHEREOF, the Company has caused this Secretary's Certificate to be
duly executed and delivered as of this _____ day of ___________, ______.
[NAME OF CREDIT PARTY]
By:___________________________
Name:_________________________
Title:________________________
D-2
Schedule 1
----------
Board Resolutions
D-3
Schedule 2
----------
Articles of Incorporation
D-4
Schedule 3
----------
Bylaws
D-5
EXHIBIT E
---------
FIRST UNION DEVELOPMENT CORPORATION
OFFICER'S CERTIFICATE
---------------------
(Pursuant to Section 5.3(cc) of the Participation Agreement)
FIRST UNION DEVELOPMENT CORPORATION, a North Carolina corporation (the
"Lessor"), DOES HEREBY CERTIFY as follows:
1. 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 date hereof.
2. Each Operative Agreement to which the Lessor is a party is in
full force and effect with respect to it.
3. The Lessor has duly performed and complied with all covenants,
agreements and conditions contained in the Participation
Agreement (hereinafter defined) or in any Operative Agreement
required to be performed or complied with by it on or prior to
the date hereof, other than those conditions which have been
expressly waived.
4. No Default or Event of Default attributable solely to the Lessor
has occurred and is continuing under any Operative Agreement.
Capitalized terms used in this Officer's Certificate and not otherwise defined
herein have the respective meanings ascribed thereto in the Participation
Agreement dated as of December 5, 2000 among Capital One Bank and Capital One,
F.S.B., jointly and severally as the Lessee and as the Construction Agent,
Capital One Financial Corporation, as the guarantor (the "Guarantor"), the
---------
Lessor, the various financial institutions and other institutional investors
which are parties thereto from time to time, Tranche A Note Purchasers (the
"Tranche A Note Purchasers"), the various banks and other lending institutions
-------------------------
which are parties thereto from time to time, as Tranche B Lenders (the "Tranche
B Lenders"), First Union National Bank, as the agent for the Primary Financing
Parties and respecting the Security Documents, as the agent for the Secured
Parties (the "Agent") and First Union National Bank, as the escrow agent (the
-----
"Escrow Agent").
------------
E-1
IN WITNESS WHEREOF, the Lessor has caused this Officer's Certificate to be duly
executed and delivered as of this _____ day of __________________, ______.
FIRST UNION DEVELOPMENT
CORPORATION
By: ____________________________
Name: __________________________
Title: _________________________
E-2
EXHIBIT F
---------
FIRST UNION DEVELOPMENT CORPORATION
SECRETARY'S CERTIFICATE
-----------------------
(Pursuant to Section 5.3(dd) of the Participation Agreement)
CERTIFICATE OF [ASSISTANT] SECRETARY
I, ______________________, duly elected and qualified [Assistant]
Secretary of First Union Development Corporation (the "Company"), hereby certify
as follows:
1. Attached hereto as Schedule 1 is a true, correct and complete
----------
copy of the resolutions of the Board of Directors of the
Company duly adopted by the Board of Directors of the Company
on __________. Such resolutions have not been amended,
modified or rescinded since their date of adoption and remain
in full force and effect as of the date hereof.
2. Attached hereto as Schedule 2 is a true, correct and complete
----------
copy of the Articles of Incorporation of the Company on file
in the Office of the Secretary of State of North Carolina.
Such Articles of Incorporation have not been amended, modified
or rescinded since their date of adoption and were in full
force and effect on the date of the resolutions referenced in
paragraph 1 and remain in full force and effect as of the date
hereof.
3. Attached hereto as Schedule 3 is a true, correct and complete
----------
copy of the Bylaws of the Company. Such Bylaws have not been
amended, modified or rescinded since their date of adoption
and remain in full force and effect as of the date hereof.
4. The persons named below now hold the offices set forth
opposite their names, and the signatures opposite their names
and titles are their true and correct signatures.
Name Office Signature
_____________________ ______________________ ___________________
_____________________ ______________________ ___________________
F-1
IN WITNESS WHEREOF, the Company has caused this ________ Secretary's Certificate
to be duly executed and delivered as of this _____ day of ___________, ______.
FIRST UNION DEVELOPMENT
CORPORATION
By: ___________________________
Name: _________________________
Title: ________________________
F-2
EXHIBIT G
---------
[Reserved]
G-1
EXHIBIT H
---------
[Reserved]
H-1
EXHIBIT I
---------
_____________________
OFFICER'S CERTIFICATE
---------------------
(Pursuant to Section 5.5 of the Participation Agreement)
CAPITAL ONE BANK, a Virginia banking corporation (the "Company"), for
-------
itself and as agent for Capital One, F.S.B., a federal savings bank, DOES HEREBY
CERTIFY as follows:
1. The address for the subject Property is _______________________________
________________________________.
2. The Completion Date for the construction of Improvements at the
Property occurred on ______________.
3. The aggregate Property Cost for the Property was $___________.
4. All representations and warranties of the Company in each Operative
Agreement and in each certificate delivered pursuant thereto are true
and correct as of the Completion Date, except to the extent any such
representation or warranty relates to an earlier date, in which case
such representation or warranty shall have been true and correct as of
such earlier date.
5. No changes or modifications other than those approved by the Agent were
made to the Plans and Specifications as provided to the appraiser for
purposes of preparing the Appraisal that, to our knowledge individually
or in the aggregate have caused or reasonably could cause the Fair
Market Sales Value of the Improvements to be materially less than the
Fair Market Sales Value at Completion as set forth in the Appraisal.
Capitalized terms used in this Officer's Certificate and not otherwise defined
have the respective meanings ascribed thereto in the Participation Agreement
dated as of December 5, 2000 among the Capital One Bank and Capital One, F.S.B.,
jointly and severally as the Lessee and as the Construction Agent, Capital One
Financial Corporation, as the guarantor (the "Guarantor"), First Union
---------
Development Corporation, as the lessor (the "Lessor"), the various financial
------
institutions and other institutional investors which are parties thereto from
time to time as purchasers of Tranche A Notes (the "Tranche A Note Purchasers"),
-------------------------
the various banks and other lending institutions which are parties thereto from
time to time as lenders (the "Tranche B Lenders") (the Tranche A Note
-----------------
Purchasers) and the Tranche B Lenders may be referred to as the "Primary
-------
Financing Parties"), First Union National Bank, as the agent for the Primary
-----------------
Financing Parties and respecting the Security Documents, as the agent for the
Secured Parties and First Union National Bank, as the escrow agent (the "Escrow
Agent").
[The remainder of this page has been intentionally left blank.]
I-1
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate
to be duly executed and delivered as of this ____ day of ______________, ______.
_______________________________
By: ___________________________
Name: _________________________
Title:_________________________
I-2
Schedule I
----------
(Documentation in Support of Aggregate Property Cost)
I-3
EXHIBIT J
---------
[Reserved]
J-1
EXHIBIT K
---------
[Description of Material Litigation]
(Pursuant to Section 6.2(d) of the Participation Agreement)
In connection with the transfer of substantially all of Signet Bank's
credit card business to the COB in November 1994, COFC and the COB agreed to
indemnify Signet Bank (which was acquired by First Union Bank on November 30,
1997) for certain liabilities incurred in litigation arising from that business,
which may include liabilities, if any, incurred in the purported class action
case described below.
During 1995, COFC and COB became involved in a purported class action
suit relating to certain collection practices engaged in by Signet Bank and,
subsequently, by COB. The complaint in this case alleges that Signet Bank and/or
COB violated a variety of California state statutes and constitutional and
common law duties by filing collection lawsuits, obtaining judgements and
pursuing garnishment proceedings in the Virginia state courts against defaulted
credit card customers who were not residents of Virginia. This case was filed in
the Superior Court of California in the County of Alameda, Southern Division, on
behalf of a class of California residents. The complaint in this case seeks
unspecified statutory damages, compensatory damages, punitive damages,
restitution, attorneys' fees and costs, a permanent injunction and other
equitable relief.
In early 1997, the California court entered judgement in favor of COB
on all of the plaintiffs' claims. The plaintiffs appealed the ruling to the
California Court of Appeals First Appellate District Division 4. In early 1999,
the Court of Appeals affirmed the trial court's ruling in favor of COB on six
counts, but reversed the trial court's ruling on two counts of the plaintiffs'
complaint. The California Supreme Court rejected COB's Petition for Review of
the remaining two counts and remitted them to the trial court for further
proceedings. In August 1999, the trial court denied without prejudice
plaintiffs' motion to certify a class on the one remaining common law claim. In
November 1999, the United States Supreme Court denied COB's writ of certiorari
on the remaining two counts, declining to exercise its discretionary power to
review these issues.
Subsequently, COB moved for summary judgement on the two remaining
counts and for a ruling that a class cannot be certified in this case. The
motion for summary judgement was granted in favor of COB on both counts, but the
plaintiffs were granted leave to amend the complaint. Plaintiff has filed an
Amended Complaint and COB's Demurrer is pending.
Because no specific measure of damages is demanded in the complaint of
the California case and the trial court entered judgement in favor of COB before
the parties completed any significant discovery, an informed assessment of the
ultimate outcome of this case cannot be made at this time. Management believes,
however, that there are meritorious defenses to this lawsuit and intends to
defend it vigorously.
COFC and its Subsidiaries are commonly subject to various other pending
and threatened legal actions arising from the conduct of its normal business
activities. In the opinion of
K-1
management, the ultimate aggregate liability, if any, arising out of any pending
or threatened action will not have a material adverse effect on the consolidated
financial condition of COFC and its Consolidated Subsidiaries. At the present
time, however, management is not in a position to determine whether the
resolution of pending or threatened litigation will have a material effect on
the COFC and its Consolidated Subsidiaries results of operations in any future
reporting period.
K-2
EXHIBIT L
[States of Incorporation/Formation and Principal Place of Business of the
Guarantor]
(Pursuant to Section 6.2(i) of the Participation Agreement)
State of State of Principal
-------- ------------------
Guarantor Incorporation/Formation Place of Business
--------- ----------------------- ------------------
COFC Delaware Virginia
L-1
--------------------------------------------------------------------------------
Appendix A
Rules of Usage and Definitions
--------------------------------------------------------------------------------
I. Rules of Usage
The following rules of usage shall apply to this Appendix A and the Operative
Agreements (and each appendix, schedule, exhibit and annex to the foregoing)
unless otherwise required by the context or unless otherwise defined therein:
(a) Except as otherwise expressly provided, any definitions set forth
herein or in any other document shall be equally applicable to the singular and
plural forms of the terms defined.
(b) Except as otherwise expressly provided, references in any document
to articles, sections, paragraphs, clauses, annexes, appendices, schedules or
exhibits are references to articles, sections, paragraphs, clauses, annexes,
appendices, schedules or exhibits in or to such document.
(c) The headings, subheadings and table of contents used in any
document are solely for convenience of reference and shall not constitute a part
of any such document nor shall they affect the meaning, construction or effect
of any provision thereof.
(d) References to any Person shall include such Person, its successors,
permitted assigns and permitted transferees.
(e) Except as otherwise expressly provided, reference to any agreement
means such agreement as amended, modified, extended, supplemented and/or
restated 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.
A-1
(i) References herein to "attorney's fees", "legal fees", "costs of
counsel" or other such references shall be deemed to include the allocated cost
of in-house counsel.
(j) Each of the parties to the Operative Agreements and their counsel
have reviewed and revised, or requested revisions to, the Operative Agreements,
and the usual rule of construction that any ambiguities are to be resolved
against the drafting party shall be inapplicable in the construction and
interpretation of the Operative Agreements and any amendments or exhibits
thereto.
(k) Capitalized terms used in any Operative Agreements which are not
defined in this Appendix A but are defined in another Operative Agreement shall
have the meaning so ascribed to such term in the applicable Operative Agreement.
(l) In computing any period of time for purposes of any Operative
Agreement, the mechanics for counting the number of days set forth in Rule 6 of
the Federal Rules of Civil Procedure shall be observed.
II. Definitions
"ABR" shall mean, for any day, a rate per annum equal to the greater of
(a) the Prime Lending Rate in effect on such day, and (b) the Federal Funds
Effective Rate in effect on such day plus one-half of one percent (0.5%). For
purposes hereof: "Prime Lending Rate" shall mean the rate announced by the Agent
from time to time as its prime lending rate as in effect from time to time. The
Prime Lending Rate is a reference rate and is one of several interest rate bases
used by the Agent and does not necessarily represent the lowest or most
favorable rate offered by the Agent actually charged to any customer. Any
Tranche B Lender may make commercial loans or other loans at rates of interest
at, above or below the Prime Lending Rate. The Prime Lending Rate shall change
automatically and without notice from time to time as and when the prime lending
rate of the Agent changes. "Federal Funds Effective Rate" shall mean, for any
period, a fluctuating interest rate per annum equal for each day during such
period to the weighted average of the rates on overnight Federal funds
transactions with members or the Federal Reserve System arranged by Federal
funds brokers, as published for such day (or, if such day is not a Business Day,
for the next preceding Business Day) by the Federal Reserve Bank of New York,
or, if such rate is not so published for any day which is a Business Day, the
average of the quotations for such day on such transactions received by the
Agent from three (3) Federal funds brokers of recognized standing selected by
it. Any change in the ABR due to a change in the Prime Lending Rate or the
Federal Funds Effective Rate shall be effective as of the opening of business on
the effective day of such change in the Prime Lending Rate or the Federal Funds
Effective Rate, respectively.
"ABR Loans" shall mean Tranche B Loans the rate of interest applicable
to which is based upon the ABR.
A-2
"Acceleration" shall have the meaning given to such term in Section 6
of the Credit Agreement and/or Section 11 of the Note Purchase Agreement.
"Accounts" shall have the meaning given to such term in Section 1 of
the Security Agreement.
"Acquisition Advance" shall have the meaning given to such term in
Section 5.3 of the Participation Agreement.
"Advance" shall mean a Construction Advance or an Acquisition Advance.
"Affiliate" means, with respect to any specified Person, any other
Person that directly or indirectly controls, or is under common control with, or
is controlled by, the specified Person. As used in this definition, "control"
(including, with its correlative meanings, "controlled by" and "under common
control with") shall mean possession, directly or indirectly, of power to direct
or cause the direction of management or policies (whether through ownership of
securities or partnership or other ownership interests, by contract or
otherwise). Notwithstanding the foregoing, no individual shall be an Affiliate
of a specified Person solely by reason of his or her being a director, officer
or employee of such specified Person or any of its Subsidiaries.
"After Tax Basis" shall mean, with respect to any payment to be
received, the amount of such payment increased so that, after deduction of the
amount of all taxes required to be paid by the recipient calculated at the then
maximum marginal rates generally applicable to Persons of the same type as the
recipients with respect to the receipt by the recipient of such amounts (less
any tax savings realized as a result of the payment of the indemnified amount),
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
Closing Date between the Construction Agent and the Lessor.
"Agency Agreement Default" shall mean any event or condition which,
with the lapse of time or the giving of notice, or both, would constitute an
Agency Agreement Event of Default.
"Agency Agreement Event of Default" shall have the meaning given to
such term in Section 5.1 of the Agency Agreement.
"Agent" shall mean First Union National Bank, as agent for the Primary
Financing Parties pursuant to the Credit Agreement and the Note Purchase
Agreement, or any successor agent appointed in accordance with the terms of the
Credit Agreement and the Note Purchase Agreement and respecting the Security
Documents, as agent for the Secured Parties.
"Applicable Percentage" shall mean for Eurodollar Loans, 1.40%.
"Appraisal" shall mean, with respect to the Property, an "as-built"
appraisal to be delivered in connection with the Participation Agreement or in
accordance with the terms of the Lease, in each case prepared by a reputable
appraiser reasonably acceptable to the Agent, which
A-3
in the reasonable 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 Bank" shall mean any bank whose short-term commercial paper
rating from S&P is at least A-1 or the equivalent thereof or from ▇▇▇▇▇'▇ is at
least P-1 or the equivalent thereof.
"Approved State" shall mean the Commonwealth of Virginia.
"Appurtenant Rights" shall mean (a) all agreements, easements, rights
of way or use, rights of ingress or egress, privileges, appurtenances,
tenements, hereditaments and other rights and benefits at any time belonging or
pertaining to the Land underlying the Improvements or the Improvements,
including without limitation the use of any streets, ways, alleys, vaults or
strips of land adjoining, abutting, adjacent or contiguous to the Land and (b)
all permits, licenses and rights, whether or not of record, appurtenant to such
Land or the Improvements.
"Assignment and Acceptance" shall mean the Assignment and Acceptance in
the form attached to the Credit Agreement as Exhibit B.
"Assignment of Escrow Account" shall mean the Assignment of Escrow
Account dated on the Closing Date executed by the Lessor and agreed and accepted
by the Construction Agent and the Agent.
"Available Tranche B Lender Commitment" shall mean, as to any Tranche B
Lender at any time, an amount equal to the excess, if any, of (a) the amount of
such Tranche B Lender's Commitment over (b) the aggregate principal amount of
all Tranche B Loans made by such Tranche B Lender as of such date (but without
giving effect to any repayments or prepayments of any Tranche B Loans under the
Credit Agreement).
"Bank Regulatory Authority" shall mean with respect to any Person, the
Board, the Comptroller of the Currency, the Federal Deposit Insurance
Corporation and all other bank regulatory authorities (including, without
limitation, relevant state bank regulatory authorities) having jurisdiction over
such person.
"Bankruptcy Code" shall mean Title 11 of the U. S. Code entitled
"Bankruptcy," as now or hereafter in effect or any successor thereto.
"Bankruptcy Event" means with respect to Borrower or any Credit Party,
any voluntary or involuntary dissolution, winding-up, total or partial
liquidation or reorganization, or bankruptcy, insolvency, receivership or other
statutory or common law proceedings or arrangements involving the Borrower or
such Credit Party or the readjustment of its liabilities or any assignment for
the benefit of creditors or any marshalling of its assets or liabilities.
A-4
"Basic Documents" shall mean the following: the Participation
Agreement, the Agency Agreement, the Credit Agreement, the Note Purchase
Agreement, the Notes, the Lease, the Guaranty and the Security Agreement.
"Basic Rent" shall mean an amount equal to the scheduled interest due
on the Notes on any Scheduled Interest Payment Date (but not including interest
on (a) any Note due prior to the Rent Commencement Date with respect to the
Property or (b) any overdue amounts under Section 2.8(b) of the Credit
Agreement, Section 7.1(b) of the Note Purchase Agreement or otherwise) payable
in accordance with the Lease and the Participation Agreement.
"Basic Term" shall have the meaning given to such term in Section 2.2
of the Lease.
"Benefitted Lender" shall have the meaning specified in Section 9.10(a)
of the Credit Agreement.
"Benefitted Note Purchaser" shall have the meaning specified in Section
22.6(a) of the Note Purchase Agreement.
"▇▇▇▇ of Sale" shall mean a ▇▇▇▇ of Sale regarding Equipment in form
and substance satisfactory to the Agent.
"Board" shall mean the Board of Governors of the Federal Reserve System
of the United States (or any successor).
"Borrower" shall mean First Union Development Corporation, a North
Carolina corporation, and any successor, replacement and/or additional borrower
or lessor expressly permitted under the Operative Agreements.
"Borrower's Interest" shall mean the Borrower's rights in, to and under
the Property, the Operative Agreements, any other property contributed on behalf
of the Lessee and any and all other property or assets from time to time of the
Borrower obtained with respect to the Operative Agreements, including, without
limitation, Modifications, and all amounts of Rent, insurance proceeds and
condemnation awards, indemnity or other payments of any kind received by the
Borrower pursuant to the Operative Agreements.
"Borrowing Date" shall mean any Business Day specified in a notice
delivered pursuant to Section 2.3 of the Credit Agreement as a date on which the
Lessor requests the Tranche B Lenders to make Loans thereunder.
"Budgeted Total Property Cost" shall mean, at any date of determination
with respect to the Property during the Construction Period, 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 the Property.
A-5
"Business Day" shall mean a day other than a Saturday, Sunday or other
day on which commercial banks in Virginia, North Carolina or any other states
from which the Agent or any Tranche B Lender funds the transactions contemplated
by the Operative Agreements 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.
"Called Principal" shall mean, with respect to any Tranche A Note, the
principal of such Tranche A Note that is to be prepaid or has become or is
declared to be immediately due and payable, as the context requires.
"Capitalized Lease" shall mean, as applied to any Person, any lease of
property (whether real, personal, tangible, intangible or mixed of such Person)
by such Person as the lessee which would be capitalized on a balance sheet of
such Person prepared in accordance with GAAP.
"Capital Adequacy Guidelines" means the Capital Adequacy Guidelines for
State Member Banks published by the Board (12 C.F.R. Part 208, Appendix A,
including related definitions in Section 208.31, in each case as amended,
modified and supplemented and in effect from time to time or any replacement
thereof).
"Capital Lease Obligations" shall mean, for any Person, all obligations
of such Person to pay rent or other amounts under a Capitalized Lease.
"Capital Stock" shall mean any nonredeemable capital stock of any
Credit Party or any of its Subsidiaries or of any other applicable Person,
whether common or preferred.
"Casualty" shall mean any damage or destruction of all or any portion
of the Property as a result of a fire or other casualty.
"Cash Equivalents" shall mean (a) securities issued or directly and
fully guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof), (b) U.S. dollar denominated
time and demand deposits and certificates of deposit of any Approved Bank having
capital and surplus in excess of $500,000,000, in each case with maturities of
not more than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof), or issued or guaranteed by any domestic corporation rated A-1
(or the equivalent thereof) or better by S&P or P-1 (or the equivalent thereof)
or better by Moody's (d) repurchase agreements with a bank or trust company
(including any of the Tranche B Lenders) or recognized securities dealer having
capital and surplus in excess of $500,000,000 for direct obligations issued by
or fully guaranteed by the United States of America and having, on the date of
purchase thereof, a fair market value of at least 100% of the amount of the
repurchase obligations, and (e) investments, classified in accordance with GAAP
as current assets, in money market investment programs registered under the
Investment Company Act of 1940, as amended, which are administered by reputable
financial institutions having capital of at least $500,000,000 and the
portfolios of which are limited to investments of the character described in the
foregoing subdivisions (a) through (c).
A-6
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, 42 U.S.C.(S) 9601 et seq., as amended
by the Superfund Amendments and Reauthorization Act of 1986.
"Chattel Paper" shall have the meaning given to such term in Section 1
of the Security Agreement.
"Claims" shall mean any and all obligations, liabilities, losses,
actions, suits, penalties, claims, demands, costs and expenses (including
without limitation reasonable attorney's fees and expenses) of any nature
whatsoever.
"Closing" shall have the meaning given to such term in Section 3 of the
Note Purchase Agreement.
"Closing Date" shall mean December 5, 2000.
"Code" shall mean the Internal Revenue Code of 1986 together with rules
and regulations promulgated thereunder, as amended from time to time, or any
successor statute thereto.
"COB" shall mean Capital One Bank, a Virginia banking corporation.
"COFC" shall mean Capital One Financial Corporation, a Delaware
corporation.
"Collateral" shall mean all assets of the Lessor, the Construction
Agent and the Lessee, now owned or hereafter acquired, upon which a Lien is
purported to be created by one or more of the Security Documents.
"Commencement Date" shall have the meaning specified in Section 2.2 of
the Lease.
"Commitments" shall mean the Tranche A Commitments of each Tranche A
Note Purchaser as set forth in Schedule A to the Note Purchase Agreement, as
----------
such Schedule A may be amended or replaced from time to time, and the Tranche B
----------
Commitments of each Tranche B Lender as set forth in Schedule 2.1 to the Credit
Agreement, as such Schedule 2.1 may be amended and replaced from time to time.
"Commitment Percentage" shall mean, as to any Primary Financing Party
at any time, the percentage which such Primary Financing Party's Commitment then
constitutes of the aggregate Commitments (or, with respect to the Tranche B
Lenders, at any time after the Commitments shall have expired or terminated, the
percentage which the aggregate principal amount of such Primary Financing
Party's Financing then outstanding constitutes of the aggregate principal amount
of all of the Financing then outstanding).
"Commitment Period" shall mean the period from and including the
Closing Date to and including the Construction Period Termination Date, or such
earlier date as the Tranche B Commitments shall terminate as provided in the
Credit Agreement.
A-7
"Company Obligations" shall mean the joint and several obligations of
Capital One, F.S.B., a federal savings bank, and Capital One Bank, a Virginia
banking corporation, in any and all capacities under and with respect to, and in
accordance with, the Operative Agreements, including, without limitation, the
obligation to pay Basic Rent, Supplemental Rent, Termination Value and Maximum
Residual Guarantee Amount.
"Completion" shall mean, with respect to the Property, such time as the
acquisition, installation, testing and final completion (subject to completion
of punch list items) of the Improvements on the Property has been achieved in
accordance with the Plans and Specifications, the Agency Agreement and/or the
Lease, and in compliance with all Legal Requirements and Insurance Requirements
and a certificate of occupancy has been issued with respect to the Property by
the appropriate governmental entity (except if non-compliance, individually or
in the aggregate, shall not have and could not reasonably be expected to have a
Material Adverse Effect or if compliance with any of the foregoing is otherwise
waived by the Agent upon instruction from the Secured Parties in accordance with
the terms of the Intercreditor Agreement).
"Completion Date" shall mean the date on which Completion for the
Property has occurred.
"Condemnation" shall mean any taking or sale of the use, access,
occupancy, easement rights or title to the Property or any part thereof, wholly
or partially (temporarily or permanently), by or on account of any actual or
threatened eminent domain proceeding or other taking of action by any Person
having the power of eminent domain, including without limitation an action by a
Governmental Authority to change the grade of, or widen the streets adjacent to,
the Property or alter the pedestrian or vehicular traffic flow to the Property
so as to result in a change in access to the Property, or by or on account of an
eviction by paramount title or any transfer made in lieu of any such proceeding
or action.
"Consolidated Subsidiary" shall mean, as to any Person, any Subsidiary
of such Person which under the rules of GAAP consistently applied should have
its financial results consolidated with those of such Person for purposes of
financial accounting statements.
"Construction Advance" shall mean an advance of funds to pay Project
Costs pursuant to Section 5.4 of the Participation Agreement.
"Construction Agent" shall mean Capital One, F.S.B., a federal savings
bank, and Capital One Bank, a Virginia banking corporation, jointly and
severally as the construction agent under the Agency Agreement.
"Construction Budget" shall mean the cost of acquisition, installation,
testing, constructing, equipping and developing the Property and other Project
Costs as determined by the Construction Agent in its reasonable, good faith
judgment.
A-8
"Construction Commencement Date" shall mean, with respect to
Improvements, the date on which construction of such Improvements commences
pursuant to the Agency Agreement.
"Construction Contract" shall mean any contract entered into between
the Construction Agent or the Lessee with a Contractor for the construction of
Improvements or any portion thereof on the Property.
"Construction Period" shall mean the period commencing on the
Construction Commencement Date for the Property and ending on the Completion
Date for the Property.
"Construction Period Property" shall have the meaning given to such
term in Section 5.3(b) of the Agency Agreement.
"Construction Period Termination Date" shall mean (a) the earlier of
(i) the date that the Tranche B Commitments have been terminated in their
entirety in accordance with the terms of Section 2.5(a) of the Credit Agreement,
or (ii) December 31, 2002 (subject to extension in accordance with Section 5.11
of the Participation Agreement) or (b) any such later date as shall be agreed to
by the Majority Secured Parties.
"Contractor" shall mean each entity with whom the Construction Agent or
the Lessee contracts to construct any Improvements or any portion thereof on the
Property.
"Control Agreement" shall mean that certain Control Agreement dated as
of the Closing Date among the Agent, the Lessor, the Construction Agent and the
Escrow Agent.
"Controlled Group" shall mean all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with any Credit Party, are treated as a single
employer under Section 414 of the Code.
"Credit Agreement" shall mean the Credit Agreement, dated as of the
Closing Date, among the Borrower, the Agent and the Tranche B Lenders, as
specified therein.
"Credit Agreement Default" shall mean any event or condition which,
with the lapse of time or the giving of notice, or both, would constitute a
Credit Agreement Event of Default.
"Credit Agreement Event of Default" shall mean any event or condition
defined as an "Event of Default" in Section 6 of the Credit Agreement.
"Credit Documents" shall mean the Participation Agreement, the Credit
Agreement, the Note Purchase Agreement, the Notes and the Security Documents.
"Credit Parties" shall mean the Construction Agent, the Lessee and the
Guarantor.
"Debt Rating" shall mean, as of any date of determination thereof and
with respect to any Person, the ratings most recently published by the Rating
Agencies relating to the unsecured, unsupported senior long-term debt
obligations of such Person.
A-9
"Deed" shall mean a warranty deed regarding the Land and/or
Improvements in form and substance satisfactory to the Agent.
"Deed of Trust Trustee" shall have the meaning given to such term in
Section 17.5(c) of the Lease.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Delinquency Ratio" shall mean, on any date and with respect to any
Person, the ratio of (a) all Past Due Receivables with respect to such Person on
such date to (b) the aggregate amount of all Managed Receivables with respect to
such Person on such date; provided that with respect to FSB, "Delinquency Ratio"
--------
shall mean the ratio (computed with respect to COB and FSB on a combined basis,
but without any intercompany eliminations) of (i) all Past Due Receivables of
COB and FSB on such date to (ii) the aggregate amount of all Managed Receivables
of COB and FSB on such date.
"Discounted Value" shall mean, with respect to the Called Principal of
any Tranche A Note, the amount obtained by discounting all Remaining Scheduled
Payments with respect to such Called Principal from their respective scheduled
due dates to the Settlement Date with respect to such Called Principal, in
accordance with accepted financial practice and at a discount factor (applied on
the same periodic basis as that on which interest on the Notes is payable) equal
to the Reinvestment Yield with respect to such Called Principal.
"Dispute" shall mean any claim or controversy arising out of, or
relating to, the Operative Agreements between or among the parties thereto.
"Documents" shall have the meaning given to such term in Section 1 of
the Security Agreement.
"Dollars" and "$" shall mean dollars in lawful currency of the United
States of America.
"Domestic Subsidiary" shall mean, with respect to any Person, any
Subsidiary of such Person which is incorporated or organized under the laws of
any State of the United States or the District of Columbia.
"Election Date" shall have the meaning given to such term in Section
20.1 of the Lease.
"Election Notice" shall have the meaning given to such term in Section
20.1 of the Lease.
"Employee Benefit Plan" or "Plan" shall mean an employee benefit plan
(within the meaning of Section 3(3) of ERISA, including without limitation any
Multiemployer Plan), or any "plan" as defined in Section 4975(e)(1) of the Code
and as interpreted by the Internal Revenue Service and the Department of Labor
in rules, regulations, releases or bulletins in effect on the Closing Date.
A-10
"Environmental Claims" shall mean any investigation, notice, violation,
demand, allegation, action, suit, injunction, judgment, order, consent decree,
penalty, fine, lien, proceeding, or claim (whether administrative, judicial, or
private in nature) relating to or affecting the Property arising (a) pursuant
to, or in connection with, an actual or alleged violation of, any Environmental
Law, (b) in connection with any Hazardous Substance, (c) from any abatement,
removal, remedial, corrective, or other response action in connection with a
Hazardous Substance, Environmental Law, or other order of a Tribunal or (d) from
any actual or alleged damage, injury, threat, or harm to health, safety, natural
resources, or the environment.
"Environmental Laws" shall mean any Law, permit, consent, approval,
license, award, or other authorization or requirement of any Tribunal relating
to emissions, discharges, releases, threatened releases of any Hazardous
Substance into ambient air, surface water, ground water, publicly owned
treatment works, septic system, or land, or otherwise relating to the handling,
storage, treatment, generation, use, or disposal of Hazardous Substances,
pollution or to the protection of health or the environment, including without
limitation CERCLA, the Resource Conservation and Recovery Act, 42 U.S.C. (S)
6901, et seq., and state statutes analogous thereto.
"Environmental Violation" shall mean any activity, occurrence or
condition that violates or threatens (if the threat requires remediation under
any Environmental Law and is not remediated during any grace period allowed
under such Environmental Law) to violate or results in or threatens (if the
threat requires remediation under any Environmental Law and is not remediated
during any grace period allowed under such Environmental Law) to result in
noncompliance with any Environmental Law relating to or affecting the Property.
"Equipment" shall mean equipment, apparatus and fixtures of every kind
and nature whatsoever purchased or otherwise acquired using the proceeds of
Advances by the Construction Agent, the Lessee or the Lessor and all
improvements and modifications thereto and replacements thereof, whether or not
now owned or hereafter acquired or now or subsequently attached to, contained in
or used or usable in any way in connection with any operation of any
Improvements, including but without limiting the generality of the foregoing,
all equipment described in the Appraisal including without limitation all
heating, electrical, and mechanical equipment, lighting fixtures, switchboards,
plumbing, ventilation, air conditioning and air-cooling apparatus,
refrigerating, and incinerating equipment, escalators, elevators, loading and
unloading equipment and systems, cleaning systems (including without limitation
window cleaning apparatus), sprinkler systems and other fire prevention and
extinguishing apparatus and materials, motors, engines, machinery, pipes, pumps,
tanks, conduits, appliances, fittings and fixtures of every kind and
description, and any other personal property described on Schedule 3 to any
Requisition, but excluding Lessee Equipment.
"Equipment Schedule" shall mean (a) each Equipment Schedule attached to
the applicable Requisition and (b) each Equipment Schedule attached to the
applicable Lease Supplement.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
A-11
"ERISA Affiliate" shall mean each entity required to be aggregated with
any Credit Party pursuant to the requirements of Section 414(b) or (c) of the
Code.
"Escrow Account" shall mean that certain deposit account (including
without limitation the deposits and other property in such account) which is
held at First Union National Bank as account number 507 2000 148.
"Escrow Agent" shall mean First Union National Bank, CMG/Corporate
Trust Department, a national banking association.
"Eurocurrency Reserve Requirements" shall mean for any day as applied
to a Eurodollar Loan, the aggregate (without duplication) of the maximum rates
(expressed as a decimal) of reserve requirements in effect on such day
(including without limitation basic, supplemental, marginal and emergency
reserves under any regulations of the Board or other Governmental Authority
having jurisdiction with respect thereto) dealing with reserve requirements
prescribed on eurocurrency funding (currently referred to as "Eurocurrency
liabilities" in Regulation D) maintained by a member bank of the Federal Reserve
System.
"Eurodollar Loans" shall mean Tranche B Loans the rate of interest
applicable to which is based upon the Eurodollar Rate.
"Eurodollar Rate" shall mean for the Interest Period for each
Eurodollar Loan comprising part of the same borrowing or advance (including
without limitation conversions, extensions and renewals), a per annum interest
rate equal to a fraction (a) expressed as a percentage (rounded upward to the
nearest one sixteenth (1/16) of one percent (1%)) (i) with the numerator equal
to a per annum interest rate determined by the Agent on the basis of the offered
rates for deposits in dollars for a period of time corresponding to such
Interest Period (and commencing on the first day of such Interest Period),
reported on Telerate page 3750 as of 11:00 a.m. (London time) two (2) Business
Days before the first day of such Interest Period and (ii) the denominator equal
to 100% minus the Eurocurrency Reserve Requirements. In the event no such
offered rates appear on Telerate page 3750, "Eurodollar Rate" shall mean for the
Interest Period for each Eurodollar Loan comprising part of the same borrowing
or advance (including without limitation conversions, extensions and renewals),
a per annum interest rate equal to a fraction (b) expressed as a percentage
(rounded upward to the nearest one sixteenth (1/16) of one percent (1%)) (i)
with the numerator equal to a per annum interest rate determined by the Agent on
the basis of the offered rates for deposits in dollars for a period of time
corresponding to such Interest Period (and commencing on the first day of such
Interest Period), which appear on the Reuters Screen LIBO Page as of 11:00 a.m.
(London time) two (2) Business Days before the first day of such Interest Period
(provided that if at least two (2) such offered rates appear on the Reuters
Screen LIBO Page, the rate in respect of such Interest Period will be the
arithmetic mean of such offered rates) and (ii) the denominator equal to 100%
minus the Eurocurrency Reserve Requirements. As used herein, "Reuters Screen
LIBO Page" means the display designated as page "LIBO" on the Reuters Monitor
Money Rates Service (or such other page as may replace the LIBO page on that
service for the purpose of displaying London interbank offered rates of major
banks) ("RMMRS"). In the event the RMMRS is not then quoting such offered rates,
-----
"Eurodollar Rate"
A-12
shall mean for the Interest Period for each Eurodollar Loan comprising part of
the same borrowing or advance (including without limitation conversions,
extensions and renewals), a per annum interest rate equal to a fraction (c)
expressed as a percentage (rounded upward to the nearest one-sixteenth (1/16) of
one percent (1%)) (i) with the numerator equal to the average per annum rate of
interest determined by the office of the Agent (each such determination to be
conclusive and binding) as of two (2) Business Days prior to the first day of
such Interest Period, as the effective rate at which deposits in immediately
available funds in U.S. dollars are being, have been, or would be offered or
quoted by the Agent to major banks in the applicable interbank market for
Eurodollar deposits at any time during the Business Day which is the second
Business Day immediately preceding the first day of such Interest Period, for a
term comparable to such Interest Period and in the amount of the requested
Eurodollar Loan and (ii) the denominator equal to 100% minus the Eurocurrency
Reserve Requirements. If no such offers or quotes are generally available for
such amount, then the Agent shall be entitled to determine the Eurodollar Rate
from another recognized service or interbank quotation, or by estimating in its
reasonable judgment the per annum rate (as described above) that would be
applicable if such quote or offers were generally available.
"Event of Default" shall mean a Lease Event of Default, an Agency
Agreement Event of Default, a Credit Agreement Event of Default or a Note
Purchase Agreement Event of Default.
"Event of Loss" shall mean any Casualty, Condemnation or Environmental
Violation that causes or results in the delivery of a Termination Notice by the
Lessee in accordance with Section 16.1 of the Lease.
"Excepted Payments" shall mean:
(a) all indemnity payments (including without limitation
indemnity payments made pursuant to Section 11 of the Participation
Agreement), whether made by adjustment to Basic Rent or otherwise, to
which any Financing Party or any of its Affiliates, agents, officers,
directors or employees is entitled;
(b) any amounts (other than Basic Rent or Termination Value)
payable under any Operative Agreement to reimburse any Financing Party
or any of its Affiliates (including without limitation the reasonable
expenses of a Financing Party incurred in connection with any such
payment) for performing or complying with any of the obligations of any
Credit Party under and as permitted by any Operative Agreement;
(c) any amount payable to the Lessor or any Primary Financing
Party by any transferee permitted under the Operative Agreements of the
Lessor or such Primary Financing Party as the purchase price of the
Lessor's interest in the Borrower's Interest (which amount shall not
include any amounts necessary to pay the principal, interest and
Make-Whole Amount on the Notes or any other amount payable to the Agent
or the Primary Financing Parties) or such Primary Financing Party's
interest in the transactions contemplated by the Operative Agreements
(or a portion thereof);
A-13
(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 any Financing Party;
(e) any insurance proceeds under policies maintained by
the Lessor or any other Financing Party pursuant to or in accordance
with the terms of the Operative Agreements;
(f) Transaction Expenses or other amounts, fees,
disbursements or expenses paid or payable to or for the benefit of the
Lessor or any other Financing Party;
(g) any payments in respect of interest to the extent
attributable to payments referred to in clauses (a) through (f) above;
and
(h) any rights of the Financing Parties 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.
"Excess Proceeds" shall mean the excess, if any, of the aggregate of
all awards, compensation or insurance proceeds payable in connection with a
Casualty or Condemnation over the Termination Value paid by the Lessee pursuant
to the Lease with respect to such Casualty or Condemnation.
"Exculpated Persons" shall mean the Lessor (except with respect to the
representations and warranties and the other obligations of the Lessor pursuant
to the Operative Agreements expressly undertaken by it in its capacity as a
Primary Financing Party), its officers, directors, shareholders and partners.
"Exempt Payments" shall have the meaning specified in Section 11.2(e)
of the Participation Agreement.
"Expiration Date" shall mean the last day of the Term; provided, in no
--------
event shall the Expiration Date be later than the tenth anniversary of the
Closing Date, unless a later date has been expressly agreed to in writing by
each of the Lessor, the Lessee, the Agent, and the Primary Financing Parties in
accordance with the terms and conditions set forth in Section 2.2 of the Lease.
"Fair Market Sales Value" shall mean, with respect to the Property, the
amount, which in any event, shall not be less than zero (0), 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, the Property. Fair Market Sales Value of the
Property shall be determined based on the assumption that, except for purposes
of Section 17 of the Lease, the Property is in the condition and state of repair
required under Section 10.1 of the Lease and each Credit Party is in compliance
with the other requirements of the Operative Agreements.
A-14
"FDIA" shall mean the Federal Deposit Insurance Act.
"Federal Funds Effective Rate" shall have the meaning given to such
term in the definition of ABR.
"Financing" shall mean the financing extended pursuant to the Credit
Agreement or the Note Purchase Agreement and shall include both the Tranche A
Proceeds and the Tranche B Loans.
"Financing Parties" shall mean the Lessor, the Agent, the Escrow Agent
and the Primary Financing Parties.
"First Priority Liens" shall have the meaning given to such term in
Section 3.1 of the Intercreditor Agreement.
"Fixtures" shall mean all fixtures, as defined in accordance with
Virginia law, relating to the Improvements, including without limitation all
components thereof, located in or on the Improvements, together with all
replacements, modifications, alterations and additions thereto, excluding Lessee
Equipment.
"Force Majeure Event" shall mean any event beyond the control of the
Construction Agent, other than a Casualty or Condemnation, including without
limitation strikes, lockouts, adverse soil conditions, acts of God, adverse
weather conditions, inability to obtain labor or materials, governmental
activities, civil commotion and enemy action; but excluding any event, cause or
condition that results from the Construction Agent's financial condition.
"Form W-8BEN" shall have the meaning specified in Section 11.2(e) of
the Participation Agreement.
"Form W-8ECI" shall have the meaning specified in Section 11.2(e) of
the Participation Agreement.
"FSB" shall mean Capital One, F.S.B., a federal savings bank.
"GAAP" shall mean generally accepted accounting principles,
consistently applied, set forth in the opinions and pronouncements of the
accounting principles board of the American Institute of Certified Public
Accountants, and statements and pronouncements of the Financial Accounting
Standards Board or in such other statements by such other entity as may be
approved by a significant segment of the accounting profession, that are
applicable to the circumstances as of the date of determination.
"Governmental Action" shall mean all permits, authorizations,
registrations, consents, approvals, waivers, exceptions, variances, orders,
judgments, written interpretations, decrees, licenses, exemptions, publications,
filings, notices to and declarations of or with, or required by, any
Governmental Authority, or required by any Legal Requirement, and shall include,
without
A-15
limitation, all environmental and operating permits and licenses that are
required for the full use, occupancy, zoning and operating of the 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.
"Ground Lease" shall mean that certain Ground Lease dated as of the
Closing Date respecting the Property between COB, as lessor, and Lessor, as
lessee.
"Guarantor" shall mean Capital One Financial Corporation, a Delaware
corporation, as a guarantor of the Construction Agent and the Lessee under the
Guaranty.
"Guarantor Credit Agreement" shall mean that certain Second Amended and
Restated Credit Agreement dated as of May 25, 1999 among Capital One Financial
Corporation, Capital One Bank and Capital One, F.S.B., as borrowers, The Chase
Manhattan Bank, as Administrative Agent and the other financial institutions
party thereto, as such may hereafter be amended, modified, supplemented and/or
restated (including by a refinancing transaction) from time to time.
"Guaranty" shall mean that certain Guaranty dated as of the Closing
Date and executed by COFC in favor of the Financing Parties; provided, however,
--------
that for purposes of Sections 6.3, 6.4, 8.3A, 8.3B, 8.3C and 8.3D of the
Participation Agreement (and defined terms used in connection therewith), the
term "Guaranty" shall also mean a guarantee, an endorsement, a contingent
agreement to purchase or to furnish funds for the payment or maintenance of, or
otherwise to be or become contingently liable under or with respect to, the
Indebtedness, other obligations, net worth, working capital or earnings of any
Person, or a guarantee of the payment of dividends or other distributions upon
the stock or equity interests of any Person, or an agreement to purchase, sell
or lease (as lessee or lessor) property, products, materials, supplies or
services primarily for the purpose of enabling a debtor to make payment of such
debtor's obligations or an agreement to assure a creditor against loss, and
including, without limitation, causing a bank or other financial institution to
issue a letter of credit or other similar instrument for the benefit of another
Person, but excluding endorsements for collection or deposit in the ordinary
course of business. The terms "Guarantee" and "Guaranteed" used as a verb shall
have a correlative meaning.
"Hard Costs" shall mean all costs and expenses payable for supplies,
materials, labor and profit with respect to the Improvements under any
Construction Contract.
"Hazardous Substance" shall mean any of the following: (a) any
petroleum or petroleum product, explosives, radioactive materials, asbestos,
formaldehyde, polychlorinated biphenyls, lead and radon gas; (b) 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 (c) any substance, material, product, derivative,
compound or mixture, mineral,
A-16
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.
"Impositions" shall mean any and all liabilities, losses, expenses,
costs, charges and Liens of any kind whatsoever for fees, taxes, levies,
imposts, duties, charges, assessments or withholdings of any nature whatsoever
("Taxes") including but not limited to (i) real and personal property taxes,
-----
including without limitation personal property taxes on any property covered by
the Lease that is classified by Governmental Authorities as personal property,
and real estate or ad valorem taxes in the nature of property taxes; (ii) sales
taxes, use taxes and other similar taxes (including rent taxes and intangibles
taxes); (iii) excise taxes; (iv) real estate transfer taxes, conveyance taxes,
stamp taxes and documentary recording taxes and fees; (v) taxes that are or are
in the nature of franchise, income, value added, privilege and doing business
taxes, license and registration fees; (vi) assessments on the Property,
including without limitation all assessments for public Improvements or
benefits, whether or not such improvements are commenced or completed within the
Term; and (vii) taxes, Liens, assessments or charges asserted, imposed or
assessed by the PBGC or any governmental authority succeeding to or performing
functions similar to, the PBGC; and all interest, additions to tax and
penalties, 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 Indemnified Person, the Property or
any part thereof or interest therein; (b) the leasing, financing, refinancing,
purchase, acceptance, rejection, demolition, construction, substitution,
subleasing, assignment, control, condition, occupancy, servicing, maintenance,
repair, ownership, possession, activity conducted on or in, delivery, insuring,
use, rental, lease, operation, improvement, sale, transfer of title, return or
other disposition of the Property or any part thereof or interest therein; (c)
the Notes, other indebtedness with respect to the Property, or any part thereof
or interest therein; (d) the rentals, receipts or earnings arising from the
Property or any part thereof or interest therein; (e) the Operative Agreements,
the execution, performance or enforcement thereof, or any payment made or
accrued pursuant thereto; (f) the income or other proceeds received with respect
to the 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 Notes; (i) the Borrower or
the Borrower's Interest; or (j) otherwise in connection with the transactions
contemplated by the Operative Agreements.
"Improvements" shall mean, with respect to the construction,
renovations and/or Modifications on the Land, all buildings, structures,
Fixtures, and other improvements of every kind existing at any time and from
time to time on or under the Land which is subject to the Ground Lease, together
with any and all appurtenances to such buildings, structures or improvements,
including without limitation sidewalks, utility pipes, conduits and lines,
parking areas and roadways, and including without limitation all Modifications
and other additions to or changes in the Improvements at any time, including
without limitation (a) any Improvements existing as of the Closing Date as such
Improvements may be referenced on the applicable Requisition and (b) any
Improvements made subsequent to the Closing Date, excluding in all circumstances
Lessee Equipment.
A-17
"Indebtedness" for any Person, means: (a) obligations created, issued
or incurred by such Person for borrowed money (whether by loan, the issuance and
sale of debt securities or the sale of property to another Person subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
from such Person); (b) obligations of such Person to pay the deferred purchase
or acquisition price of property or services, other than trade accounts payable
(other than for borrowed money) arising, and accrued expenses incurred, in the
ordinary course of business so long as such trade accounts payable are payable
within 90 days of the date the respective goods are delivered or the respective
services are rendered; (c) Indebtedness of others secured by a Lien on the
property of such Person, whether or not the respective indebtedness so secured
has been assumed by such Person; (d) non-contingent obligations of such Person
in respect of letters of credit, bankers' acceptances or similar instruments
issued or accepted by banks and other financial institutions for account of such
Person; (e) Capital Lease Obligations of such Person; and (f) Indebtedness of
others Guaranteed by such Person.
"Indemnified Person" shall mean the Lessor, the Agent, the Placement
Agent, the Escrow Agent, the Primary Financing Parties and their respective
successors, assigns, directors, trustees, shareholders, partners, officers,
employees, agents and Affiliates.
"Indemnity Provider" shall mean the Lessee.
"Initial Construction Advance" shall mean any initial Advance to pay
for: (a) Property Costs for construction of any Improvements; and (b) the
Property Costs of restoring or repairing the Property in accordance with Section
15.1(e) of the Lease.
"Instruments" shall have the meaning given to such term in Section 1 of
the Security Agreement.
"Insurance Consultant" shall mean ▇▇▇▇▇ USA Inc.
"Insurance Requirements" shall mean all terms and conditions of any
insurance policy either required by the Lease to be maintained by the Lessee or
required by the Agency Agreement to be maintained by the Construction Agent, and
all requirements of the issuer of any such policy and, regarding self insurance,
any other requirements of the Lessee or the Construction Agent, as the case may
be.
"Insured Subsidiary" shall mean any insured depositary institution (as
defined in 12 U.S.C. ss.1813(c) (or any successor provision), as amended,
re-enacted or redesignated from time to time), that is controlled (within the
meaning of 12 U.S.C. ss.1841 (or any successor provision), as amended,
re-enacted or redesignated from time to time) by any Credit Party.
"Intangibles" means, as at any date and with respect to any Person, the
aggregate amount (to the extent reflected in determining the consolidated
stockholders' equity of such Person and its consolidated Subsidiaries) of (a)
all write-ups (other than write-ups resulting from foreign currency translations
and write-ups of assets of a going concern business made within 12 months after
the acquisition of such business) subsequent to September 30, 2000 in the book
value of
A-18
any asset of such Person or any of its consolidated Subsidiaries, (b) all
Investments in unconsolidated Subsidiaries of such Person and all equity
investments in Persons that are not Subsidiaries of such Person and (c) all
unamortized debt discount and expense, unamortized deferred charges, goodwill,
patents, trademarks, service marks, trade names, anticipated future benefit of
tax loss carry-forwards, copyrights, organization or developmental expenses and
other intangible assets.
"Intercreditor Agreement" shall mean that certain Intercreditor and
Lien Subordination Agreement dated as of the Closing Date among the Lessee, the
Guarantor, the Lessor, the Tranche A Note Purchasers, the Tranche B Lenders and
the Agent.
"Interest Period" shall mean during the Commitment Period and
thereafter as to any Eurodollar Loan (i) with respect to the initial Interest
Period, the period beginning on the date of the first Eurodollar Loan and ending
one (1) month, two (2) months, three (3) months or six (6) months thereafter, as
selected by the Lessee on behalf of the Lessor in its applicable notice given
with respect thereto and (ii) thereafter, each period commencing on the last day
of the next preceding Interest Period applicable to such Eurodollar Loan and
ending one (1) month, two (2) months, three (3) months or six (6) months
thereafter, as selected by the Lessee on behalf of the Lessor by irrevocable
notice to the Agent in each case not less than three (3) Business Days prior to
the last day of the then current Interest Period with respect thereto; provided,
--------
however, that all of the foregoing provisions relating to Interest Periods are
-------
subject to the following: (A) if any Interest Period would end on a day which is
not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day (except that where the next succeeding Business Day
falls in the next succeeding calendar month, then on the next preceding Business
Day), (B) no Interest Period shall extend beyond the Expiration Date, as the
case may be, (C) where an Interest Period begins on a day for which there is no
numerically corresponding day in the calendar month in which the Interest Period
is to end, such Interest Period shall end on the last Business Day of such
calendar month, (D) there shall not be more than four (4) Interest Periods
outstanding at any one (1) time.
"Interim Term" shall have the meaning given to such term in Section 2.2
of the Lease.
"Investment" shall mean, for any Person: (a) the acquisition (whether
for cash, property, services or securities or otherwise) of capital stock,
bonds, notes, debentures, partnership or other ownership interests or other
securities of any other Person or any agreement to make any such acquisition
(including, without limitation, any "short sale" or any sale of any securities
at a time when such securities are not owned by the Person entering into such
sale); (b) the making of any deposit with, or advance, loan or other extension
of credit to, any other Person (including the purchase of property from another
Person subject to an understanding or agreement, contingent or otherwise, to
resell such property to such Person), but excluding any such advance, loan or
extension of credit having a term not exceeding 90 days arising in connection
with the sale of inventory or supplies by such Person in the ordinary course of
business; or (c) the entering into of any Guarantee of, or other contingent
obligation with respect to, Indebtedness or other liability of any other Person
and (without duplication) any amount committed to be advanced, lent or extended
to such Person.
A-19
"Investment Company Act" shall mean the Investment Company Act of 1940,
as amended, together with the rules and regulations promulgated thereunder.
"Land" shall mean a parcel of real property described on (a) the
Requisition issued by the Construction Agent on the Closing Date relating to
such parcel and (b) the schedules to each applicable Lease Supplement executed
and delivered in accordance with the requirements of Section 2.4 of the Lease.
"Law" shall mean any statute, law, ordinance, regulation, rule,
directive, order, writ, injunction or decree of any Tribunal.
"Lease" or "Lease Agreement" shall mean the Lease Agreement dated as of
the Closing Date, between the Lessor and the Lessee, together with the Lease
Supplement thereto.
"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 the Lease Supplement substantially in the
form of Exhibit A to the Lease, together with all attachments and schedules
thereto.
"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 Lessor, any Credit
Party, the Agent, any Primary Financing Party or the Property, Land,
Improvement, Equipment or the taxation, demolition, construction, use or
alteration of such Property, Land, Improvements or Equipment, whether now or
hereafter enacted and in force, including without limitation any that require
repairs, modifications or alterations in or to the Property or in any way limit
the use and enjoyment thereof (including without limitation all building, zoning
and fire codes and the Americans with Disabilities Act of 1990, 42 U.S.C. ss.
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 without limitation all Environmental
Laws), and all permits, certificates of occupancy, licenses, authorizations and
regulations relating thereto, and all covenants, agreements, restrictions and
encumbrances contained in any instruments which are either of record or known to
any Credit Party affecting the Property or the Appurtenant Rights.
"Lessee" shall have the meaning set forth in the Lease.
"Lessee Equipment" shall mean all signs, exterior lighting standards,
machinery, apparatus, furniture, furnishings, telephone systems,
telecommunication systems, computers, computer terminals, all items relating to
data transmission, trash compactors, shelving, snow removal and lawn maintenance
equipment and other related equipment, movable or demountable partitions,
motorized vehicles, trade fixtures and temporary auxiliary structures, tools,
supplies, materials, security systems, wiring, fibers, PBX, data connections,
video equipment, cafeteria furnishings and equipment, public address system,
inventory and other personal property and all
A-20
renewals and replacements thereof, in each case, now owned or hereafter acquired
by the Lessee (without the proceeds of any Advance and which is not attached to
the Improvements in such a manner as to become a fixture under applicable law)
or any subtenant or permitted assignee of the Lessee (without the proceeds of
any Advances and which is not attached to the Improvements in such a manner as
to become a fixture under applicable law) and installed or located at or on the
Property or necessary for the operations of the Lessee's business.
"Lessor" shall mean First Union Development Corporation, a North
Carolina corporation, and any successor, replacement and/or additional lessor or
lessor expressly permitted under the Operative Agreements.
"Lessor Financing Statements" shall mean UCC financing statements and
fixture filings appropriately completed and executed for filing in the
applicable jurisdictions in order to protect the Lessor's interest under the
Lease to the extent the Lease is a security agreement or a mortgage.
"Lessor Lien" shall mean any Lien, true lease or sublease or
disposition of title arising as a result of (a) any claim against the Lessor not
resulting from the transactions contemplated by the Operative Agreements, (b)
any act or omission of the Lessor 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 with respect to Taxes or Transaction Expenses
against which the Lessee is not required to indemnify the Lessor pursuant to
Section 11 of the Participation Agreement or (d) any claim against the Lessor
arising out of any transfer by the Lessor of all or any portion of the interest
of the Lessor in the Property, the Borrower's Interest or the Operative
Agreements other than the transfer of title to or possession of any Property by
the Lessor pursuant to and in accordance with the Lease, the Note Purchase
Agreement, 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.
"Leverage Ratio" means, on any date and with respect to any Person, the
ratio of (a) the sum (determined for such Person and its consolidated
Subsidiaries on a consolidated basis without duplication in accordance with
GAAP) of (i) the aggregate amount of Indebtedness outstanding on such date (not
including non-brokered deposit liabilities incurred by such Person in the
ordinary course of business) minus (ii) the aggregate amount of all on-balance
-----
sheet loans held for securitization on such date to (b) Tangible Net Worth with
respect to such Person on such date.
"Lien" shall mean any mortgage, pledge, security interest, encumbrance,
lien, option or charge of any kind.
"Limited Recourse Amount" shall mean with respect to the Property, an
amount equal to the Termination Value with respect to the Property on each
Payment Date, less the Maximum Residual Guarantee Amount as of such date with
respect to the Property.
"Majority Secured Parties" shall mean at any time, Primary Financing
Parties whose Financings outstanding represent at least fifty-one percent (51%)
of (a) the aggregate Financings
A-21
outstanding or (b) to the extent there are no Financings outstanding, the
aggregate of the Primary Financing Party Commitments.
"Majority Tranche A Note Purchasers" shall mean at any time, Tranche A
Note Purchasers whose Tranche A Proceeds outstanding represent at least
fifty-one percent (51%) of the aggregate Tranche A Proceeds outstanding.
"Majority Tranche B Lenders" shall mean at any time, Tranche B Lenders
whose Tranche B Loans outstanding represent at least fifty-one percent (51%) of
(a) the aggregate Tranche B Loans outstanding or (b) to the extent there are no
Tranche B Loans outstanding, the aggregate of the Tranche B Commitments.
"Make-Whole Amount" shall mean, with respect to any Tranche A Note, an
amount equal to the excess, if any, of the Discounted Value of the Remaining
Scheduled Payments with respect to the Called Principal of such Tranche A Note
over the amount of such Called Principal; provided that the Make-Whole Amount
--------
may in no event be less than zero.
"Managed Receivables" means, on any date, the sum for any Person and
its consolidated Subsidiaries (determined on a consolidated basis in accordance
with GAAP) of (a) all on-balance sheet credit card loans and other finance
receivables plus (b) all on-balance sheet credit card loans and other finance
----
receivables held for securitization plus (c) all securitized credit card loans
----
and other finance receivables managed by such Person and its consolidated
Subsidiaries, provided that, as the term "Managed Receivables" is used in the
--------
definition of "Tier 1 Capital to Managed Receivables Ratio", clauses (a), (b)
and (c) above shall be determined exclusive of securitized non-revolving finance
receivables.
"Marketing Notice" shall have the meaning given to such term in Section
3.2(c) of the Intercreditor Agreement.
"Marketing Period" shall mean, if the Lessee has given a Sale Notice in
accordance with Section 20.1 of the Lease, the period commencing on the date
such Sale Notice is given and ending on the Expiration Date.
"Marketing Price" shall have the meaning given to such term in Section
3.2(c) of the Intercreditor Agreement.
"Material" means material in relation to the business, operations,
affairs, financial condition, assets, properties, or prospects of any Person and
its Subsidiaries taken as a whole.
"Material Adverse Effect" shall mean a material adverse effect on (a)
the business, condition (financial or otherwise), assets, liabilities or
operations of COFC and its Consolidated Subsidiaries taken as a whole, (b) the
ability of any Credit Party to perform its respective obligations under any
Operative Agreement to which it is a party, (c) the validity or enforceability
of any Operative Agreement or the rights and remedies of the Agent, the Primary
Financing Parties, or the Lessor thereunder, (d) the validity, priority or
enforceability of any Lien on the Property or the Collateral created by any of
the Operative Agreements, or (e) the fair
A-22
market value, utility or useful life of the Property or the use, or ability of
the Lessee to use, the Property for the purpose for which it was intended.
"Material Subsidiary" means any Subsidiary of any Person except a
special purpose vehicle.
"Maturity Date" shall mean the Expiration Date.
"Maximum Amount" shall have the meaning given to such term in Section
5.4 of the Agency Agreement.
"Maximum Guaranty Price Contract" shall mean that certain construction
contract to be entered into prior to the commencement of construction of the
Improvements by and between the Construction Agent and ▇▇▇▇▇ ▇. ▇▇▇▇▇
Construction Corporation.
"Maximum Residual Guarantee Amount" shall mean, at any date of
determination, an amount equal to the sum of all amounts due and owing to the
Tranche A Note Purchasers under the Note Purchase Agreement, the Tranche A Notes
and under any other Operative Agreement.
"Modifications" shall have the meaning specified in Section 11.1(a) of
the Lease.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc.
"Mortgage Instruments" shall mean each deed of trust and any other
instrument executed by the Lessor and the Lessee (or to the extent the Property
is subject to a Ground Lease, the applicable Affiliate of the Lessee) in favor
of the Agent (for the benefit of the Primary Financing Parties and the Lessor)
and evidencing a Lien on the Property, in form and substance reasonably
acceptable to the Agent, including without limitation the Tranche A Mortgage
Instrument and the Tranche B Mortgage Instrument.
"Multiemployer Plan" shall mean a multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions have been made by any Credit Party
or any ERISA Affiliate and that is covered by Title IV of ERISA.
"Multiple Employer Plan" shall mean a plan to which any Credit Party or
any ERISA Affiliate and at least one (1) other employer other than an ERISA
Affiliate is making or accruing an obligation to make, or has made or accrued an
obligation to make, contributions.
"Non-GAAP Expenses" shall mean Tranche A Non-GAAP Interest Expense,
up-front structuring fees and any monthly extension fees paid or payable to the
Tranche B Lenders, any other non-capitalized expenses relating to the Property
determined in accordance with GAAP as such term was defined on the Closing Date,
and any other non-capitalized expenses expressly approved by Lessor and each
Tranche B Lender (in their sole discretion) from time to time.
"Note Purchase Agreement" shall mean that certain Note Purchase
Agreement dated as of the Closing Date among the Tranche A Note Purchasers, the
Borrower and the Agent.
A-23
"Note Purchase Agreement Default" shall mean any event or condition
which, with the lapse of time or the giving of notice, or both, would constitute
a Note Purchase Agreement Event of Default.
"Note Purchase Agreement Event of Default" shall have the meaning
given to such term in Section 11 of the Note Purchase Agreement.
"Notes" shall mean those notes issued to the Primary Financing Parties
pursuant to the Note Purchase Agreement or the Credit Agreement and shall
include both the Tranche A Notes and the Tranche B Notes.
"Obligations" shall have the meaning given to such term in Section 1 of
the Security Agreement.
"Officer's Certificate" means a certificate of a Senior Financial
Officer or of any other officer of any Person whose responsibilities extend to
the subject matter of such certificate.
"Operative Agreements" shall mean the following: the Participation
Agreement, the Agency Agreement, the Note Purchase Agreement, the Credit
Agreement, the Notes, the Lease, the Lease Supplement, the Guaranty, the
Security Agreement, the Assignment of Escrow Account, the Control Agreement, the
Intercreditor Agreement, the Mortgage Instruments, the other Security Documents
and the Ground Lease.
"Original Executed Counterpart" shall have the meaning given to such
term in Section 5 of Exhibit A to the Lease.
---------
"Overdue Interest" shall mean any interest payable pursuant to Section
2.8(b) of the Credit Agreement.
"Overdue Rate" shall mean (a) with respect to Basic Rent and
Supplemental Rent, and any other amount owed under or with respect to the Credit
Agreement, the Note Purchase Agreement, the Notes or the Security Documents, the
rate specified in Section 2.8(b) of the Credit Agreement or 7.1(b) of the Note
Purchase Agreement, as applicable, and (b) with respect to any other amount, the
amount referred to in clause (y) of Section 2.8(b) of the Credit Agreement or
clause (y) of Section 7.1(b) of the Note Purchase Agreement, as applicable.
"Parent" means Capital One Financial Corporation, a Delaware
corporation.
"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 Closing Date, among the Lessee, the Guarantor, the Lessor, the Primary
Financing Parties, the Agent and the Escrow Agent.
A-24
"Past-Due Receivables" means, on any date, the sum (determined with
respect to any Person and its Subsidiaries on a consolidated basis in accordance
with GAAP) of (a) all Managed Receivables the minimum payments on which are at
least 90 days overdue on such date plus (b) all other non-performing assets;
provided that Managed Receivables that are credit card loans, whether or not at
least 90 days overdue, shall not constitute "Past-Due Receivables" to the extent
of any cash balance of the account debtor on such loan on deposit with the
creditor (but only to the extent such creditor is entitled under an agreement
governing such credit card loan to set-off such cash balances against the
obligations of the account debtor under such loan and to the extent such cash
balances are not subject to any other set-off or deduction by such creditor or
any of its affiliates against a matured obligation owing by such debtor).
"Payment Date" shall mean any Scheduled Interest Payment Date and any
date on which interest in connection with a prepayment of principal on the
Financing is due under the Credit Agreement, the Note Purchase Agreement or the
Notes.
"PBGC" shall mean the Pension Benefit Guaranty Corporation created by
Section 4002(a) of ERISA or any successor thereto.
"Pension Plan" shall mean a "pension plan", as such term is defined in
section 3(2) of ERISA, which is subject to title IV of ERISA (other than a
Multiemployer Plan), and to which any Credit Party or any ERISA Affiliate may
have any liability, including without limitation any liability by reason of
having been a substantial employer within the meaning of section 4063 of ERISA
at any time during the preceding five (5) years, or by reason of being deemed to
be a contributing sponsor under section 4069 of ERISA.
"Permitted Facility" shall mean each parcel of real property (together
with improvements existing or to be built thereon) selected by the Lessee and
acceptable to the Agent.
"Permitted Liens" shall mean, with respect to the Property:
(a) the respective rights and interests of the parties to
the Operative Agreements as provided in the Operative Agreements;
(b) the rights of any sublessee or assignee under a
sublease or an assignment expressly permitted by the terms of the Lease
for no longer than the duration of the Lease;
(c) 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;
(d) Liens arising by operation of law, materialmen's,
mechanics', workmen's, repairmen's, employees', carriers',
warehousemen's and other like Liens relating to the construction of the
Improvements or in connection with any Modifications or arising in the
ordinary course of business for amounts that either are not more than
thirty (30) days past due or are being diligently contested in good
faith by appropriate proceedings, so
A-25
long as such proceedings satisfy the conditions for the continuation of
proceedings to contest Taxes set forth in Section 13.1 of the Lease;
(e) Liens of any of the types referred to in clause (d)
above that have been bonded for not less than the full amount in
dispute (or as to which other security arrangements satisfactory to the
Lessor and the Agent have been made), which bonding (or arrangements)
shall comply with applicable Legal Requirements, and shall have
effectively stayed any execution or enforcement of such Liens;
(f) 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;
(g) Liens in favor of municipalities to the extent agreed
to by the Lessor and the Agent;
(h) 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, will have a Material Adverse Effect; and
(i) any other Lien expressly consented to or approved by
the Agent.
"Person" shall mean any individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company, trust,
unincorporated organization, governmental authority or any other entity.
"Placement Agent" shall mean First Union Securities, Inc., in its
capacity as the Placement Agent under the Note Purchase Agreement.
"Plan" means an employee benefit or other plan established or
maintained by any Credit Party or any ERISA Affiliate and that is covered by
Title IV of ERISA, other than a Multiemployer Plan.
"Plans and Specifications" shall mean, with respect to Improvements,
Equipment and other components of the Property, the plans and specifications for
such Improvements, Equipment and other components of the Property to be
constructed, as such Plans and Specifications may be amended, modified or
supplemented from time to time in accordance with the terms of the Operative
Agreements.
"Primary Financing Party Commitments" shall mean the Primary Financing
Party Commitment of (i) each Tranche A Note Purchaser as set forth on Schedule A
to the Note Purchase Agreement, as such Schedule A may be amended and replaced
----------
from time to time and
A-26
(ii) each Tranche B Lender as set forth in Schedule 2.1 to the Credit Agreement
as such Schedule 2.1 may be amended and replaced from time to time.
"Primary Financing Party Financing Statements" shall mean UCC financing
statements and fixture filings appropriately completed and executed for filing
in the applicable jurisdiction in order to procure a security interest in favor
of the Agent in the Collateral subject to the Security Documents.
"Primary Financing Parties" shall mean the Tranche A Note Purchasers,
the Tranche B Lenders and any other banks, financial institutions or other
institutional investors which may be from time to time a Tranche A Note
Purchaser or a Tranche B Lender to the Participation Agreement and either the
Credit Agreement or the Note Purchase Agreement pursuant to the terms thereof.
"Prime Lending Rate" shall have the meaning given to such term in the
definition of ABR.
"Project Cost" shall have the meaning given to such term in Section 5.1
of the Participation Agreement.
"Property" shall mean the Permitted Facility that is (or is to be)
acquired, ground leased, constructed and/or renovated pursuant to the terms of
the Operative Agreements, the leasehold interest in the Land and each item of
Equipment and the various Improvements, in each case located on such Land.
"Property Acquisition Cost" shall mean the cost to the Lessor to ground
lease the Property on the Closing Date.
"Property Cost" shall mean, with respect to the Property at any date of
determination, an amount equal to (a) the aggregate principal amount of all
Advances made on or prior to such date and advanced to or for the benefit of the
Construction Agent pursuant to and for the purposes set forth in Section 5.1(a)
of the Participation Agreement with respect to the Property minus (b) the
-----
aggregate amount of prepayments or repayments as the case may be of the Tranche
A Notes or the Tranche B Loans allocated to reduce the Property Cost of the
Property pursuant to Section 8 of the Note Purchase Agreement or Section 2.6(c)
of the Credit Agreement, respectively.
"PTE" shall have the meaning given to such term in Section 6.2(a) of
the Note Purchase Agreement.
"Purchase Option" shall have the meaning given to such term in Section
20.1 of the Lease.
"Purchasing Lender" shall have the meaning given to such term in
Section 9.8(a) of the Credit Agreement.
A-27
"QPAM Exemption" shall mean Prohibited Transaction Class Exemption
84-14 issued by the United States Department of Labor.
"Rating Agencies" shall mean ▇▇▇▇▇'▇, S&P and Fitch Investors Service,
L.P. or, in each case, any successor nationally recognized statistical rating
organization.
"Register" shall have the meaning given to such term in Section 9.9(a)
of the Credit Agreement.
"Regulation D" shall mean Regulation D of the Board, as the same may be
modified and supplemented and in effect from time to time.
"Regulation T" shall mean Regulation T of the Board, as the same may be
modified and supplemented and in effect from time to time.
"Regulation U" shall mean Regulation U of the Board, as the same may be
modified and supplemented and in effect from time to time.
"Regulation X" shall mean Regulation X of the Board, as the same may be
modified and supplemented and in effect from time to time.
"Reinvestment Yield" shall mean, with respect to the Called Principal
of any Tranche A Note, 0.50% over the yield to maturity implied by (a) the
yields reported, as of 10:00 A.M. (New York City time) on the third Business Day
preceding the Settlement Date with respect to such Called Principal, on the
display designated as "Page USD" of the Bloomberg Financial Markets Services
Screen (or, if not available, any other nationally recognized trading screen
reporting on-line intraday trading in U.S. Treasury securities) for actively
traded U.S. Treasury securities having a maturity equal to the Remaining Average
Life of such Called Principal as of such Settlement Date, or (b) if such yields
are not reported as of such time or the yields reported as of such time are not
ascertainable, the Treasury Constant Maturity Series Yields reported, for the
latest day for which such yields have been so reported as of the second Business
Day preceding the Settlement Date with respect to such Called Principal, in
Federal Reserve Statistical Release H.15 (519) (or any comparable successor
publication) for actively traded U.S. Treasury securities having a constant
maturity equal to the Remaining Average Life of such Called Principal as of such
Settlement Date. Such implied yield will be determined, if necessary, by (i)
converting U.S. Treasury ▇▇▇▇ quotations to bond-equivalent yields in accordance
with accepted financial practice and (ii) interpolating linearly between (1) the
actively traded U.S. Treasury security with the maturity closest to and greater
than the Remaining Average Life and (2) the actively traded U.S. Treasury
security with the maturity closest to and less than the Remaining Average Life.
"Related Financing Party" shall have the meaning given to such term in
Section 3.12 of the Intercreditor Agreement.
A-28
"Release" shall mean any release, pumping, pouring, emptying,
injecting, escaping, leaching, dumping, seepage, spill, leak, flow, discharge,
disposal or emission of a Hazardous Substance.
"Remaining Average Life" shall mean, with respect to any Called
Principal, the number of years (calculated to the nearest one-twelfth year)
obtained by dividing (a) such Called Principal into (b) the sum of the products
obtained by multiplying (i) the principal component of each Remaining Scheduled
Payment with respect to such Called Principal by (ii) the number of years
(calculated to the nearest one-twelfth year) that will elapse between the
Settlement Date with respect to such Called Principal and the scheduled due date
of such Remaining Scheduled Payment.
"Remaining Scheduled Payments" shall mean, with respect to the Called
Principal of any Tranche A Note, all payments of such Called Principal and
interest thereon that would be due after the Settlement Date with respect to
such Called Principal if no payment of such Called Principal were made prior to
its scheduled due date; provided that if such Settlement Date is not a date on
which interest payments are due to be made under the terms of the Tranche A
Notes, then the amount of the next succeeding scheduled interest payment will be
reduced by the amount of interest accrued to such Settlement Date and required
to be paid on such Settlement Date.
"Rent" shall mean, collectively, the Basic Rent and the Supplemental
Rent, in each case payable under the Lease.
"Rent Commencement Date" shall mean the Completion Date.
"Reportable Event" shall have the meaning specified in Section 4043 of
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.
"Requisition" shall have the meaning specified in Section 4.2 of the
Participation Agreement.
"Responsible Officer" shall mean the Chairman or Vice Chairman of the
Board of Directors, the Chief Executive Officer, the President, any Senior Vice
President or Executive Vice President, any Vice President, the Secretary, any
Assistant Secretary, the Treasurer, any Assistant Treasurer or the Director of
Corporate Funding.
"Risk Adjusted Assets" means, on any date, the amount, for any Person
and its consolidated Subsidiaries (determined on a consolidated basis), of
"weighted risk assets", within the meaning given to such term in the Capital
Adequacy Guidelines.
"Rule 144A" shall mean Rule 144A of the Securities Act.
A-29
"S&P" shall mean Standard and Poor's Rating Group, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Sale Date" shall have the meaning given to such term in Section
20.3(a) of the Lease.
"Sale Notice" shall mean a notice given to the Agent in connection with
the election by the Lessee of its Sale Option.
"Sale Option" shall have the meaning given to such term in Section 20.1
of the Lease.
"Sale Proceeds Shortfall" shall mean the amount by which the proceeds
of a sale described in Section 22.1 of the Lease are less than the Limited
Recourse Amount with respect to the Property if it has been determined that the
Fair Market Sales Value of the Property at the expiration of the term of the
Lease has been impaired by greater than ordinary wear and tear during the Term
of the Lease.
"Scheduled Interest Payment Date" shall mean (a) as to any Eurodollar
Loan, the last day of the Interest Period applicable to such Eurodollar Loan (or
respecting any Eurodollar Loan having an Interest Period of six (6) months, the
three (3) month anniversary of such Interest Period), (b) as to any ABR Loan and
any interest payment payable on any Tranche A Note, the first day of each month,
unless such day is not a Business Day and in such case on the next occurring
Business Day and (c) as to all Financings, the date of any voluntary or
involuntary payment, prepayment, return or redemption of any principal amount
thereof, and the Maturity Date, as the case may be.
"Second Priority Liens" shall have the meaning given to such term in
Section 3.1 of the Intercreditor Agreement.
"Secured Parties" shall have the meaning given to such term in the
Security Agreement.
"Securities Act" shall mean the Securities Act of 1933, as amended,
together with the rules and regulations promulgated thereunder.
"Security Agreement" shall mean the Security Agreement dated as of the
Closing Date between the Borrower and the Agent, for the benefit of the Secured
Parties, and accepted and agreed to by the Lessee.
"Security Assets" shall have the meaning given to such term in Section
2 of the Security Agreement.
"Security Documents" shall mean the collective reference to the
Security Agreement, the Mortgage Instruments, (to the extent the Lease is
construed as a security instrument) the Lease, the UCC Financing Statements and
all other security documents hereafter delivered to the Agent granting a Lien on
any asset or assets of any Person to secure the obligations and liabilities of
the Lessor under the Note Purchase Agreement, the Credit Agreement and/or under
any of the other Credit Documents.
A-30
"Senior Financial Officer" means the chief financial officer, principal
accounting officer, treasurer, assistant treasurer or comptroller of any Credit
Party.
"Settlement Date" shall mean, with respect to the Called Principal of
any Tranche A Note, the date on which such Called Principal is to be prepaid or
has become or is declared to be immediately due and payable, as the context
requires.
"Soft Costs" shall mean all costs which are ordinarily and reasonably
incurred in relation to the acquisition, development, installation,
construction, improvement and testing of the Property other than Hard Costs,
including without limitation structuring fees, administrative fees, legal fees,
upfront fees, fees and expenses related to appraisals, title examinations, title
insurance, document recordation, surveys, environmental site assessments,
geotechnical soil investigations and similar costs and professional fees
customarily associated with a real estate closing, the fees and expenses of the
Lessor payable or reimbursable under the Operative Agreements and costs and
expenses incurred pursuant to Sections 7.3(a) and 7.3(b) of the Participation
Agreement.
"Source" shall have the meaning given to such term in Section 6.2 of
the Note Purchase Agreement.
"Subsidiary" shall mean, with respect to any Person, any corporation,
partnership or other entity of which at least a majority of the Voting
Securities issued by such corporation, partnership or other entity is at the
time directly or indirectly owned or controlled by such Person or one or more
Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person.
"Supplemental Amounts" shall have the meaning given to such term in
Section 9.18 of the Credit Agreement and Section 22.14 of the Note Purchase
Agreement, respectively.
"Supplemental Rent" shall mean all amounts, liabilities and obligations
(other than Basic Rent) which the Lessee assumes or agrees to pay to the Lessor,
the Agent, the Primary Financing Parties or any other Person under the Lease or
under any of the other Operative Agreements including without limitation
payments of the Termination Value and the Maximum Residual Guarantee Amount and
all indemnification amounts, liabilities and obligations.
"Tangible Net Worth" means, on any date and with respect to any Person,
the consolidated stockholders' equity of such Person and its consolidated
Subsidiaries less Intangibles of such Person and its consolidated Subsidiaries,
all determined as of such date on a consolidated basis without duplication in
accordance with GAAP.
"Tax Affiliate" means, with respect to any corporate Person, any member
of an affiliated group (within the meaning of Section 1504(a) of the Code or any
similar provision of state or local law) in which such Person is a member,
"former Tax Affiliate" means, with respect to any corporate Person, any other
Person that had been but is not currently affiliated (within the
A-31
meaning of Section 1504(a) of the Code or any similar provision of state or
local law) with such Person, with respect to the period of their affiliation.
"Taxes" shall have the meaning specified in the definition of
"Impositions".
"Term" shall mean, collectively, the Interim Term and the Basic Term.
"Termination Date" shall have the meaning specified in Section 16.2(a)
of the Lease.
"Termination Event" shall mean (a) with respect to any Pension Plan,
the occurrence of a Reportable Event or an event described in Section 4062(e) of
ERISA, (b) the withdrawal of any Credit Party or any ERISA Affiliate from a
Multiple Employer Plan during a plan year in which it was a substantial employer
(as such term is defined in Section 4001(a)(2) of ERISA), or the termination of
a Multiple Employer Plan, (c) the distribution of a notice of intent to
terminate a Plan or Multiemployer Plan pursuant to Section 4041(a)(2) or 4041A
of ERISA, (d) the institution of proceedings to terminate a Plan or
Multiemployer Plan by the PBGC under Section 4042 of ERISA, (e) any other event
or condition which might constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan or
Multiemployer Plan, or (f) the complete or partial withdrawal of any Credit
Party or any ERISA Affiliate from a Multiemployer Plan.
"Termination Notice" shall have the meaning specified in Section 16.1
of the Lease.
"Termination Value" shall mean the sum of (a) the outstanding aggregate
purchase price paid by the Tranche A Note Purchasers for the Tranche A Notes
(minus any amounts then on deposit in the Escrow Account), plus (b) the
outstanding aggregate principal amount of Tranche B Loans, plus (c) any accrued
and unpaid interest owing to the Tranche A Note Purchasers or the Tranche B
Lenders under the Tranche A Notes and the Tranche B Notes, plus (d) with respect
to the Tranche B Lenders, any amounts payable pursuant to Section 11.4 of the
Participation Agreement, and (other than in the case of an Event of Loss) with
respect to the Tranche A Note Purchasers, the Make-Whole Amount, plus (e) to the
extent the same is not duplicative of the amounts payable under clauses (a)
through (d) above, all other Rent and other amounts then due and payable or
accrued under the Agency Agreement, Lease and/or under any other Operative
Agreement (including without limitation amounts under Sections 11.1 and 11.2 of
the Participation Agreement and all costs and expenses referred to in clause
FIRST of Section 22.2 of the Lease).
-----
"Tier 1 Capital" means, on any date, the amount, for any Person and its
consolidated Subsidiaries (determined on a consolidated basis) on such date, of
"Tier 1 Capital", within the meaning given to such term in the Capital Adequacy
Guidelines.
"Tier 1 Capital to Managed Receivables Ratio" means, on any date, the
ratio (expressed as a percentage) of (a) Tier 1 Capital with respect to any
Person on such date to (b) Managed Receivables with respect to such Person on
such date.
A-32
"Tier 1 Capital to Risk Adjusted Assets Ratio" means, on any date, the
ratio (expressed as a percentage) of (a) Tier 1 Capital with respect to any
Person on such date to (b) Risk Adjusted Assets with respect to such Person on
such date.
"Total Assets" means, on any date, the amount, for any Person and its
consolidated Subsidiaries (determined on a consolidated basis) on such date of
"average total consolidated assets", within the meaning given to such term in
the Capital Adequacy Guidelines.
"Total Capital" means, on any date, the amount, for any Person and its
consolidated Subsidiaries (determined on a consolidated basis) on such date, of
"total capital", within the meaning given to such term in the Capital Adequacy
Guidelines.
"Total Capital to Risk Adjusted Assets Ratio" means, on any date, the
ratio (expressed as a percentage) of (a) Total Capital with respect to any
Person on such date to (b) Risk Adjusted Assets with respect to such Person on
such date.
"Tranche A Commitments" shall mean the obligation of the Tranche A Note
Purchasers to purchase the Tranche A Notes from the Borrower in an aggregate
principal amount not to exceed the aggregate of the amounts set forth opposite
each Tranche A Note Purchaser's name on Schedule A to the Note Purchase
----------
Agreement; provided, no Tranche A Note Purchaser shall be obligated to purchase
--------
Tranche A Notes in excess of such Tranche A Note Purchaser's share of the
Tranche A Commitments as set forth adjacent to such Tranche A Note Purchaser's
name on Schedule A to the Note Purchase Agreement.
----------
"Tranche A Mortgage Instruments" means each deed of trust and any other
instrument executed by the Borrower and the Lessee in favor of the Agent (for
the benefit of the Tranche A Note Purchasers) and evidencing a Lien on the
Property, in form and substance reasonably acceptable to the Tranche A Note
Purchasers.
"Tranche A Non-GAAP Interest Expense" shall mean, for any Interest
Period during the Construction Period, the interest payable pursuant to the
Tranche A Notes on that portion of the Tranche A Proceeds then remaining in the
Escrow Account minus any income earned from the investment of Tranche A Proceeds
in Cash Equivalents pursuant to Section 5.12 of the Participation Agreement.
"Tranche A Note" shall have the meaning given to it in Section 1 of the
Note Purchase Agreement.
"Tranche A Note Purchasers" shall mean the several institutional
investors from time to time party to the Note Purchase Agreement that commit to
purchase or otherwise hold from time to time the Tranche A Notes.
"Tranche A Obligations" means the collective reference to all
obligations, now existing or hereafter arising, owing by the Borrower and/or the
Credit Parties and/or any of their affiliates to the Tranche A Note Purchasers
under or pursuant to the Operative Agreements whether direct or indirect,
absolute or contingent, due or to become due, now existing or hereafter
incurred,
A-33
which may arise under, out of, or in connection with the Participation
Agreement, the Note Purchase Agreement, the Lease Agreement, the Agency
Agreement, the Tranche A Notes or any of the other Operative Agreements, whether
on account of principal, advanced amounts, interest, Make-Whole Amount,
reimbursement obligations, fees, indemnities, costs, expenses or otherwise
(including, without limitation, all reasonable fees and disbursements of counsel
to the Agent or to the Tranche A Note Purchasers) that are required to be paid
by the Borrower and/or the Credit Parties pursuant to the terms of the Operative
Agreements.
"Tranche A Proceeds" shall mean the proceeds from the sale of the
Tranche A Notes to the Tranche A Note Purchasers pursuant to the Tranche A
Commitment.
"Tranche B Commitments" shall mean the obligation of the Tranche B
Lenders to make the Tranche B Loans to the Lessor in an aggregate principal
amount at any one time outstanding not to exceed the aggregate of the amounts
set forth opposite each Tranche B Lender's name on Schedule 2.1 to the Credit
------------
Agreement, as such amount may be increased or reduced from time to time in
accordance with the provisions of the Operative Agreements; provided, no Tranche
--------
B Lender shall be obligated to make Tranche B Loans in excess of such Tranche B
Lender's share of the Tranche B Commitments as set forth adjacent to such
Tranche B Lender's name on Schedule 2.1 to the Credit Agreement.
------------
"Tranche B Lenders" shall mean First Union National Bank and shall
include the several banks and other financial institutions from time to time
party to the Credit Agreement that commit to make the Tranche B Loans.
"Tranche B Loan" shall mean the loans made pursuant to the Tranche B
Commitment.
"Tranche B Mortgage Instruments" means each deed of trust and any other
instrument executed by the Borrower and the Lessee in favor of the Agent (for
the benefit of the Tranche B Lenders) and evidencing a Lien on the Property, in
form and substance reasonably acceptable to the Tranche B Lenders.
"Tranche B Note" shall have the meaning given to it in Section 2.2 of
the Credit Agreement.
"Tranche B Obligations" means the collective reference to all
obligations, now existing or hereafter arising, owing by the Borrower and/or the
Credit Parties and/or any of their affiliates to the Tranche B Lenders under or
pursuant to the Operative Agreements whether direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter incurred, which may
arise under, out of, or in connection with the Participation Agreement, the
Credit Agreement, the Lease Agreement, the Agency Agreement, the Tranche B
Notes, or any of the other Operative Agreements, whether on account of
principal, advanced amounts, interest, reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without limitation, all
reasonable fees and disbursements of counsel to the Agent or to the Tranche B
Lenders) that are required to be paid by the Borrower and/or the Credit Parties
pursuant to the terms of the Operative Agreements.
A-34
"Transaction Expenses" shall mean all Soft Costs and all other 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 all costs and expenses described in
Section 7 of the Participation Agreement and the following:
(a) the reasonable fees, out-of-pocket expenses and
disbursements of ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC and ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇, as
counsel to the Financing Parties, and of counsel to the Credit Parties
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, but excluding in all cases the fees, expenses and
disbursements of counsel to any individual Tranche A Note Purchaser;
(b) the reasonable fees, out-of-pocket expenses and
disbursements of accountants for any Credit Party in connection with
the transaction contemplated by the Operative Agreements;
(c) any and all other reasonable fees, charges or other
amounts payable to the Primary Financing Parties, the Agent, the Escrow
Agent, the Lessor or any broker which arises under any of the Operative
Agreements;
(d) any other reasonable fees, out-of-pocket expenses,
disbursements or costs of any party to the Operative Agreements or any
of the other transaction documents; and
(e) 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
Agreements.
"Tribunal" shall mean any state, commonwealth, federal, foreign,
territorial, or other court or government body, subdivision agency, department,
commission, board, bureau or instrumentality of a governmental body.
"Type" shall mean, as to any Tranche B Loan, whether it is an ABR Loan
or a Eurodollar Loan.
"UCC Financing Statements" shall mean collectively the Primary
Financing Party Financing Statements and the Lessor Financing Statements.
"Unfunded Liability" shall mean, with respect to any Plan, at any time,
the amount (if any) by which (a) the present value of all accrued benefits under
such Plan exceeds (b) the fair market value of all Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plan, but only to the extent that such excess represents a potential liability
of the Lessee or any member of the Controlled Group to the PBGC or such Plan
under Title IV of ERISA.
A-35
"Uniform Commercial Code" and "UCC" shall mean the Uniform Commercial
Code as in effect in any applicable jurisdiction.
"U.S. Person" shall have the meaning specified in Section 11.2(e) of
the Participation Agreement.
"U.S. Taxes" shall have the meaning specified in Section 11.2(e) of the
Participation Agreement.
"Voting Securities" shall mean, with respect to any Person, securities
or other ownership interests having by the terms thereof ordinary voting power
to elect a majority of the board of directors or other persons performing
similar functions of such Person (irrespective of whether or not at the time
securities or other ownership interests of any other class or classes of such
Person shall have or might have voting power by reason of the happening of any
contingency).
"Wholly-Owned Entity" shall mean a Person all of the shares of capital
stock or other ownership interest of which are owned by a referent Person and/or
one of such referent Person's wholly-owned Subsidiaries or other wholly-owned
entities.
"Withdrawal Liability" shall have the meaning given such term under
Part I of Subtitle E of Title IV of ERISA.
"Withholdings" shall have the meaning specified in Section 11.2(e) of
the Participation Agreement.
"Work" shall mean the furnishing of labor, materials, components,
furniture, furnishings, fixtures, appliances, machinery, equipment, tools,
power, water, fuel, lubricants, supplies, goods and/or services with respect to
the Property.
A-36