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EXHIBIT 10.17
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PARTICIPATION AGREEMENT
Dated as of April 23, 1999
among
THE VARIOUS PARTIES HERETO FROM TIME TO TIME,
as the Guarantors,
VERITAS SOFTWARE CORPORATION
as the Construction Agent and as the Lessee,
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually, except as expressly
stated herein, but solely as the Owner Trustee
under the VS Trust 1999-1,
THE VARIOUS BANKS AND OTHER LENDING INSTITUTIONS WHICH ARE PARTIES
HERETO FROM TIME TO TIME, as the Holders,
THE VARIOUS BANKS AND OTHER LENDING INSTITUTIONS WHICH ARE PARTIES
HERETO FROM TIME TO TIME, as the Lenders,
and
NATIONSBANK, N.A.,
as the Agent for the Lenders
and respecting the Security Documents,
as the Agent for the Lenders and the Holders,
to the extent of their interests
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TABLE OF CONTENTS
Page
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SECTION 1A. SINGLE PROPERTY................................................ 1
SECTION 1. THE LOANS....................................................... 1
SECTION 2. HOLDER ADVANCES................................................. 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......... 3
3.4. Ratable Interests of the Lenders................................. 3
SECTION 4. THE CLOSINGS.................................................... 3
4.1. Initial Closing Date............................................. 3
4.2. Initial Closing Date; Property Closing Dates; Acquisition
Advances; Construction Advances................................ 3
SECTION 5. FUNDING OF ADVANCES; CONDITIONS PRECEDENT; REPORTING
REQUIREMENTS ON COMPLETION DATE; THE LESSEE'S DELIVERY OF NOTICES;
RESTRICTIONS ON LIENS...................................................... 4
5.1. General.......................................................... 4
5.2. Procedures for Funding........................................... 4
5.3. Conditions Precedent for the Lessor, the Agent, the Lenders
and the Holders Relating to the Initial Closing Date and the
Advance of Funds for the Acquisition of a Property............. 7
5.4. Conditions Precedent for the Lessor, the Agent, the Lenders
and the Holders Relating to the Advance of Funds after
the Acquisition Advance........................................ 11
5.5. Additional Reporting and Delivery Requirements on Completion
Date and on Construction Period Termination Date............... 13
5.6. The Construction Agent Delivery of Construction Budget
Modifications.................................................. 14
5.7. Restrictions on Liens............................................ 14
5.8. Payments......................................................... 14
5.9. Unilateral Right to Increase the Holder Commitments and the
Lender Commitments............................................. 15
5.10. Joinder Agreement Requirements.................................. 15
5.11. Property Cost as of the Rent Commencement Date.................. 15
SECTION 6. REPRESENTATIONS AND WARRANTIES.................................. 16
6.1. Representations and Warranties of the Borrower................... 16
6.2. Representations and Warranties of the Credit Parties............. 18
SECTION 6B. GUARANTY....................................................... 23
6B.1. Guaranty of Payment and Performance............................. 23
6B.2. Obligations Unconditional....................................... 24
6B.3. Modifications................................................... 25
6B.4. Waiver of Rights................................................ 25
6B.5. Reinstatement................................................... 26
6B.6. Remedies........................................................ 26
6B.7. Limitation of Guaranty.......................................... 26
6B.8. Payment of Amounts to the Agent................................. 26
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SECTION 7. PAYMENT OF CERTAIN EXPENSES...................................... 27
7.1. Transaction Expenses.............................................. 27
7.2. Brokers' Fees..................................................... 28
7.3. Certain Fees and Expenses......................................... 28
7.4. Commitment Fee.................................................... 29
SECTION 8. OTHER COVENANTS AND AGREEMENTS................................... 29
8.1. Cooperation with the Construction Agent or the Lessee............. 29
8.2. Covenants of the Owner Trustee and the Holders.................... 29
8.3. Credit Party Covenants, Consent and Acknowledgment................ 31
8.3A. Affirmative Covenants............................................ 35
8.3B. Negative Covenants............................................... 40
8.4. Sharing of Certain Payments....................................... 44
8.5. Grant of Easements, etc. ......................................... 45
8.6. Appointment by the Agent, the Lenders, the Holders and the
Owner Trustee..................................................... 45
8.7. Collection and Allocation of Payments and Other Amounts........... 46
8.8. Release of Properties, etc. ...................................... 49
SECTION 9. CREDIT AGREEMENT AND TRUST AGREEMENT............................. 49
9.1. The Construction Agent's and the Lessee's Credit
Agreement Rights.................................................. 49
9.2. The Construction Agent's and the Lessee's Trust
Agreement Rights.................................................. 50
SECTION 10. TRANSFER OF INTEREST............................................ 51
10.1. Restrictions on Transfer......................................... 51
10.2. Effect of Transfer............................................... 52
SECTION 11. INDEMNIFICATION................................................. 52
11.1. General Indemnity................................................ 52
11.2. General Tax Indemnity............................................ 55
11.3. Increased Costs, Illegality, etc. ............................... 59
11.4. Funding/Contribution Indemnity................................... 61
11.5. EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE, STRICT
LIABILITY, ETC. ................................................ 62
11.6. Additional Provisions Regarding Environmental Indemnification.... 63
11.7. Additional Provisions Regarding Indemnification.................. 63
11.8. Indemnifications Provided by the Owner Trustee in Favor of
the Other Indemnified Persons................................... 63
SECTION 12. MISCELLANEOUS
12.1. Survival of Agreements........................................... 64
12.2. Notices.......................................................... 65
12.3. Counterparts..................................................... 66
12.4. Terminations, Amendments, Waivers, Etc.; Unanimous Vote Matters.. 66
12.5. Headings, etc. .................................................. 68
12.6. Parties in Interest.............................................. 68
12.7. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY
TRIAL; VENUE.................................................... 68
12.8. Severability..................................................... 69
12.9. Liability Limited................................................ 69
12.10. Rights of the Credit Parties.................................... 70
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12.11. Further Assurances................................................... 70
12.12. Calculations under Operative Agreements.............................. 71
12.13. Confidentiality...................................................... 71
12.14. Financial Reporting/Tax Characterization............................. 71
12.15. Set-off.............................................................. 72
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SCHEDULES
Schedule 8.3A(a)(iii) - Form of Officer's Compliance Certificate
Schedule 8.3B(a)(ii) - Schedule of Indebtedness
Schedule 8.3B(e) - Schedule of Insignificant Lines of Business
Schedule 8.3B(f) - Schedule of Investments
EXHIBITS
A - Form of Requisition - Sections 4.2, 5.2, 5.3 and 5.4
B - [RESERVED]
C - Form of Officer's Certificate - Section 5.3(z)
D - Form of Secretary's Certificate - Section 5.3(aa)
E - Form of Officer's Certificate - Section 5.3(bb)
F - Form of Secretary's Certificate - Section 5.3(cc)
G - Form of Outside Counsel Opinion for the Owner Trustee - Section 5.3(dd)
H - Form of Outside Counsel Opinion for the Lessee - Section 5.3(ee)
I - Form of Officer's Certificate - Section 5.5
J - Description of Material Litigation - Section 6.2(d)
Appendix A - Rules of Usage and Definitions
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PARTICIPATION AGREEMENT
THIS PARTICIPATION AGREEMENT dated as of April 23, 1999 (as amended,
modified, extended, supplemented, restated and/or replaced from time to time,
this "Agreement") is by and among VERITAS SOFTWARE CORPORATION, a Delaware
corporation (the "Lessee" or the "Construction Agent"); the various parties
hereto from time to time as guarantors (subject to the definition of Guarantors
in Appendix A hereto, individually, a "Guarantor" and collectively, the
"Guarantors"); FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national banking
association, not individually (in its individual capacity, the "Trust
Company"), except as expressly stated herein, but solely as the Owner Trustee
under the VS Trust 1999-1 (the "Owner Trustee", the "Borrower" or the
"Lessor"); the various banks and other lending institutions which are parties
hereto from time to time as holders of certificates issued with respect to the
VS Trust 1999-1 (subject to the definition of Holders in Appendix A hereto,
individually, a "Holder" and collectively, the "Holders"); the various banks
and other lending institutions which are parties hereto from time to time as
lenders (subject to the definition of Lenders in Appendix A hereto,
individually, a "Lender" and collectively, the "Lenders"); and NATIONSBANK,
N.A., a national banking association, as the agent for the Lenders and
respecting the Security Documents, as the agent for the Lenders and the
Holders, to the extent of their interests (in such capacity, the "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 1A. SINGLE PROPERTY.
Notwithstanding the reference to multiple Properties herein and in the
other Operative Agreements, the parties hereto acknowledge and agree that such
Properties, as more particularly described in one or more Lease Supplements,
constitute a single parcel of real property together with any improvements
existing thereon or to be constructed thereon in accordance with the terms and
conditions hereof and of the other Operative Agreements.
SECTION 1. THE LOANS.
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 Lenders
have agreed to make Loans to the Lessor from time to time in an aggregate
principal amount of up to the aggregate amount of the Commitments of the Lenders
in order for the Lessor to acquire the Properties and certain Improvements, 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, and in consideration of the receipt of proceeds of the Loans,
the Lessor will issue the Notes. The Loans shall be made and the Notes shall be
issued pursuant to the Credit Agreement. Pursuant to
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Section 5 of this Agreement and Section 2 of the Credit Agreement, the Loans
will be made to the Lessor from time to time at the request of the Construction
Agent in consideration for the Construction Agent agreeing for the benefit of
the Lessor, pursuant to the Agency Agreement, to acquire the Properties, to
acquire the Equipment, to construct certain Improvements and to cause the
Lessee to lease the Properties, each in accordance with the Agency Agreement
and the other Operative Agreements. The Loans and the obligations of the Lessor
under the Credit Agreement shall be secured by the Collateral.
SECTION 2. HOLDER ADVANCES.
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, on each
date Advances are requested to be made in accordance with Section 5 hereof,
each Holder shall make a Holder Advance on a pro rata basis to the Lessor with
respect to the VS Trust 1999-1 based on its Holder Commitment in an amount in
immediately available funds such that the aggregate of all Holder Advances at
all times shall be no less than three percent (3%) of the amount of all
outstanding Advances; provided, that no Holder shall be obligated for any
Holder Advance in excess of its pro rata share of the Available Holder
Commitment. The aggregate amount of Holder Advances shall be up to the
aggregate amount of the Holder Commitments. No prepayment or any other payment
with respect to Advances shall be permitted such that the aggregate Holder
Advances with respect to such outstanding Advance is less than three percent
(3%) of all outstanding Advances, except in connection with termination or
expiration of the Term or in connection with the exercise of remedies relating
to the occurrence of a Lease Event of Default. The representations, warranties,
covenants and agreements of the Holders herein and in the other Operative
Agreements are several, and not joint or joint and several. The Holder Advances
and the obligations of the Lessor under the Trust Agreement shall be secured by
the Collateral.
SECTION 3. SUMMARY OF TRANSACTIONS.
3.1. OPERATIVE AGREEMENTS.
On the date hereof, each of the respective parties hereto and thereto
shall execute and deliver this Agreement, the Lease, the Agency Agreement, the
Credit Agreement, the Notes, the Trust Agreement, the Certificates, the
Security Agreement, 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 each Property Closing Date and subject to the terms and conditions of
this Agreement (a) the Holders will each make a Holder Advance in accordance
with Sections 2 and 5 of this Agreement and the terms and provisions of the
Trust Agreement, (b) the Lenders will each make
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Loans in accordance with Sections 1 and 5 of this Agreement and the terms and
provisions of the Credit Agreement. (c) the Lessor will purchase and acquire
good and marketable title to the applicable Property, identified by the
Construction Agent, in each case pursuant to a Deed or ▇▇▇▇ of Sale, as the case
may be, and grant the Agent a lien on such Property by execution of the required
Security Documents, (d) the Agent, the Lessee and the Lessor shall execute and
deliver a Lease Supplement relating to such Property and (e) the Basic Term
shall commence with respect to such Property.
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 the
Improvements and the Lessee shall commence to pay Basic Rent as of the Rent
Commencement Date.
3.4. RATABLE INTERESTS OF THE LENDERS.
Each Lender agrees at all times (a) to hold the same ratable portion of
the aggregate Lender Commitment for Tranche A Loans and the aggregate Lender
Commitment for Tranche B Loans and (b) to make advances consistent with such
committed amounts referenced in Section 3.4(a) in accordance with the
requirements of the Operative Agreements.
SECTION 4. THE CLOSINGS.
4.1. INITIAL CLOSING DATE.
All documents and instruments required to be delivered on the Initial
Closing Date shall be delivered at the offices of ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC, Bank
of America Corporate Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, or at such other location as may be determined by the Lessor,
the Agent and the Lessee.
4.2. INITIAL CLOSING DATE; PROPERTY CLOSING DATES; ACQUISITION ADVANCES;
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 (b) each Acquisition Advance pursuant to
Section 5.3 and (c) each Construction Advance pursuant to Section 5.4. No
Requisition shall be required for the Lenders and the Holders to make Advances
pursuant to or in connection with Sections 7.1(a), 7.1(b) and 11.8.
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SECTION 5. FUNDING OF ADVANCES; CONDITIONS PRECEDENT;
REPORTING REQUIREMENTS ON COMPLETION DATE;
THE LESSEE'S DELIVERY OF NOTICES; RESTRICTIONS ON LIENS.
5.1. GENERAL.
(a) To the extent funds have been advanced to the Lessor as Loans by
the Lenders and to the Lessor as Holder Advances by the Holders, the Lessor
will use such funds from time to time in accordance with the terms and
conditions of this Agreement and the other Operative Agreements (i) according
to the directions of the Construction Agent to acquire the Properties 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 Properties (or
components thereof) in accordance with the terms of the Agency Agreement and
the other Operative Agreements, and (iii) to pay Transaction Expenses and other
disbursements payable by the Lessor under Section 11.8.
(b) In lieu of the payment of interest on the Loans and Holder Yield
on the Holder Advances on any Scheduled Interest Payment Date with respect to
any Property during the period prior to the Rent Commencement Date with respect
to such Property and subject to Section 5.9, (i) each Lender's Loan shall
automatically be increased by the amount of interest accrued and unpaid on such
Loan for such period (except to the extent that at any time such increase would
cause such Lender's Loan to exceed such Lender's Available Commitment, in which
case the Lessee shall pay such excess amount to such Lender in immediately
available funds on the date such Lender's Available Commitment was exceeded),
and (ii) each Holder's Holder Advance shall automatically be increased by the
amount of Holder Yield accrued and unpaid on such Holder Advance for such
period (except to the extent that any time such increase would cause the Holder
Advance of such Holder to exceed such Holder's Available Holder Commitment, in
which case the Lessee shall pay such excess amount to such Holder in
immediately available funds on the date the Available Holder Commitment of such
Holder was exceeded). Such increases in a Lender's Loan and a Holder's Holder
Advance shall occur without any disbursement of funds by any Person.
5.2. PROCEDURES FOR FUNDING.
(a) The Construction Agent shall designate the date for Advances
hereunder in accordance with the terms and provisions hereof; provided,
however, it is understood and agreed that no more than two (2) Advances
(excluding any conversion and/or continuation of any Loan or Holder Advance)
may be requested during any calendar month and no such designation from the
Construction Agent is required for funding of Transaction Expenses and other
disbursements payable by the Lessor pursuant to or in
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connection with Section 11.8; provided, further, the Construction Agent shall
deliver to the Agent on the first Business Day of each month following an
Acquisition Advance with respect to a Property until the Completion Date with
respect to such Property, a Requisition for any Construction Advance requested
with respect to such Property for the immediately preceding month. Not less
than (i) three (3) Business Days prior to the date that the first Advance is
requested hereunder and (ii) three (3) Business Days prior to the date on which
any subsequent Acquisition Advance (or on the first Business Day of the month,
in the case of a Construction Advance) is to be made, the Construction Agent
shall deliver to the Agent, (A) with respect to the date that the first Advance
is requested hereunder and each subsequent Acquisition Advance, a Requisition
as described in Section 4.2 hereof (including without limitation a legal
description of the Land, if any, a schedule of the Improvements, if any, and a
schedule of the Equipment, if any, acquired or to be acquired on such date, and
a schedule of the Work, if any, to be performed, each of the foregoing in a
form reasonably acceptable to the Agent) and (B) with respect to each
Construction Advance, a Requisition identifying (among other things) the
Property to which such Construction Advance relates.
(b) Each Requisition shall: (i) be irrevocable, (ii) request funds in an
amount that is not in excess of the total aggregate of the Available
Commitments plus the Available Holder Commitments at such time, and (iii)
request that the Holders make Holder Advances and that the Lenders make Loans
to the Lessor for the payment of Transaction Expenses, Property Acquisition
Costs (in the case of an Acquisition Advance) or other Property 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, on the Property Closing Date or the date on
which the Construction Advance is to be made, as applicable, (i) the Lenders
shall make Loans based on their respective Lender Commitments to the Lessor in
an aggregate amount equal to ninety-seven percent (97%) of the Requested Funds
specified in any Requisition plus any additional amount of Transaction Expenses
as referenced in Sections 7.1(a) and 7.1(b) and any additional amount
respecting any indemnity payment as referenced in Section 11.8, unless any such
funding of Transaction Expenses or any indemnity payment is declined in writing
by each Lender and each Holder (such decision to be in the sole discretion of
each Lender and each Holder) ratably between the Tranche A Lenders and the
Tranche B Lenders with the Tranche A Lenders funding eighty-six percent (86%)
of the Requested Funds and the Tranche B Lenders funding eleven percent (11%)
of the Requested Funds), up to an aggregate principal amount equal to the
aggregate of the Available Commitments, (ii) the Holders shall make Holder
Advances based on their respective Holder Commitments in an aggregate amount
equal to three percent (3%) of the balance of the Requested Funds specified in
such Requisition plus any additional amount of Transaction Expenses as
referenced in Sections 7.1(a) and 7.1(b) and any additional amount respecting
any indemnity payment as referenced in Section 11.8, unless any such funding of
Transaction Expenses or any indemnity payment is declined
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in writing by each Lender and each Holder (such decision to be in the sole
discretion of each Lender and each Holder), up to the aggregate advanced
amount equal to the aggregate of the Available Holder Commitments; and (iii)
the total amount of such Loans and Holder Advances made on such date shall (x)
be used by the Lessor to pay Property Costs including Transaction Expenses
within three (3) Business Days of the receipt by the Lessor of such Advance or
(y) be advanced by the Lessor on the date of such Advance to the Construction
Agent or the Lessee to pay Property Costs, as applicable. 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) With respect to an Advance obtained by the Lessor to pay for Property
Costs and/or Transaction Expenses or other costs payable under Section 11.8
hereof and not expended by the Lessor for such purpose on the date of such
Advance, such amounts shall be held by the Lessor (or the Agent on behalf of the
Lessor) until the applicable closing date or payment date or, if such closing
date or payment date does not occur within three (3) Business Days of the date
of the Lessor's receipt of such Advance, shall be applied regarding the
applicable Advance to repay the Lenders and the Holders and, subject to the
terms hereof, and of the Credit Agreement and the Trust Agreement, shall remain
available for future Advances. Any such amounts held by the Lessor (or the
Agent on behalf of the Lessor) shall be subject to the lien of the Security
Agreement.
(e) All Operative Agreements which are to be delivered to the Lessor, the
Agent, the Lenders or the Holders shall be delivered to the Agent, on behalf of
the Lessor, the Agent, the Lenders or the Holders, and such items (except for
Notes, Certificates, Bills of Sale, the chattel paper originals, with respect
to which in each case there shall be only one original) shall be delivered with
originals sufficient for the Lessor, the Agent, each Lender and each Holder.
All other items which are to be delivered to the Lessor, the Agent, the Lenders
or the Holders shall be delivered to the Agent, on behalf of the Lessor, the
Agent, the Lenders or the Holders, and such other items shall be held by the
Agent. To the extent any such other items are requested in writing from time to
time by the Lessor, any Lender or any Holder, the Agent shall provide a copy of
such item to the party requesting it.
(f) Notwithstanding the completion of any closing under this Agreement
pursuant to Sections 5.3 or 5.4, each condition precedent in connection with
any such closing may be subsequently enforced by the Agent (unless such has been
expressly waived in writing by the Agent).
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5.3. CONDITIONS PRECEDENT FOR THE LESSOR, THE AGENT, THE LENDERS AND THE
HOLDERS RELATING TO THE INITIAL CLOSING DATE AND THE ADVANCE OF FUNDS
FOR THE ACQUISITION OF A PROPERTY.
The obligations (i) on the Initial Closing Date of the Lessor, the Agent,
the Lenders and the Holders 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 Initial
Closing Date, (ii) on the Initial Closing Date of the Holders to make Holder
Advances, and of the Lenders to make Loans in order to pay Transaction Expenses
and (iii) on a Property Closing Date for the purpose of providing funds to the
Lessor necessary to pay the Transaction Expenses and to acquire a Property (an
"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 Initial Closing Date or the
applicable Property Closing Date, as the case may be (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 it 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 of the representations and warranties of the
parties to this Agreement contained herein, in each of the other Operative
Agreements and each certificate delivered pursuant to any Operative
Agreement on each such date;
(b) the performance by the parties to this Agreement of the material
obligations 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 shall have received a fully executed counterpart copy
of the Requisition, appropriately completed;
(d) title to each such Property shall conform to the representations
and warranties set forth in Section 6.2(1) hereof;
(e) the Construction Agent shall have delivered to the Agent a good
standing certificate for the Construction Agent in the state where each
such Property is located, the Deed with respect to the Land and existing
Improvements (if any), and a copy of the ▇▇▇▇ of Sale with respect to the
Equipment (if any), respecting such of the foregoing as are being acquired
on each such date with the proceeds of the Loans and Holder Advances or
which have been previously acquired with the proceeds of the Loans and
Holder Advances and such Land, existing Improvements (if any) and Equipment
(if any) shall be located in and Approved State;
(f) there shall not have occurred and be continuing any Default or
Event of Default under any of the Operative Agreements (other than a
Default that would be cured
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upon application of the proceeds of such Advance, provided that such proceeds
are so applied or provision reasonably satisfactory to the Agent shall have been
made such that the proceeds will be so applied) and no Default or Event of
Default under any of the Operative Agreements will have occurred after giving
effect to the Advance requested by each such Requisition;
(g) the Construction Agent shall have delivered to the Agent title
insurance commitments to issue policies respecting each such Property, with such
endorsements as the Agent deems necessary, in favor of the Lessor and the Agent
from a title insurance company acceptable to the Agent, but only with such title
exceptions thereto as are acceptable to the Agent;
(h) the Construction Agent shall have delivered to the Agent an
environmental site assessment respecting each such Property prepared by an
independent recognized professional reasonably acceptable to the Agent and
evidencing no pre-existing environmental condition (other than any 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 a Survey
respecting the Property;
(j) [RESERVED];
(k) the Agent shall be satisfied that the acquisition, ground leasing
and/or holding of each such Property and the execution of the Mortgage
Instrument and the other Security Documents will not materially and adversely
affect the rights of the Lessor, the Agent, the Holders or the Lenders under or
with respect to the Operative Agreements;
(l) the Construction Agent shall have delivered to the Agent invoices for,
or other reasonably satisfactory evidence of, the various Transaction Expenses;
(m) the Construction Agent shall have caused to be delivered to the Agent
a Mortgage Instrument (in such form as is reasonably acceptable to the Agent,
with revisions as necessary to conform to applicable state law), Lessor
Financing Statements and Lender Financing Statements respecting each such
Property, all fully executed and in recordable form;
(n) the Lessee shall have delivered to the Agent with respect to each such
Property a Lease Supplement and a memorandum (or short form lease) regarding the
Lease and such Lease Supplement (such memorandum or short form lease to be in
the form attached to the Lease as Exhibit B or in such other form as is
reasonably acceptable to the Agent, with modifications as necessary to conform
to applicable state law, and in form suitable for recording);
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(o) with respect to each Acquisition Advance, the sum of the Available
Commitment plus the Available Holder Commitment (after deducting the Unfunded
Amount, if any, and after giving effect to the Acquisition Advance) will be
sufficient to pay all amounts payable therefrom;
(p) [RESERVED];
(q) [RESERVED];
(r) the Construction Agent shall have delivered to the Agent a preliminary
Construction Budget for each such Property, if applicable;
(s) the Construction Agent shall have provided evidence to the Agent of
insurance with respect to each such Property as provided in the Lease;
(t) an Appraisal satisfactory to the Agent regarding each such Property
shall be provided to the Agent from an appraiser selected by the Agent;
(u) (i) the Agent shall cause Uniform Commercial Code lien searches, tax
lien searches and judgment lien searches regarding the Lessee to be conducted
(and copies thereof to be delivered to the Agent) in such jurisdictions as
reasonably determined by the Agent by a nationally recognized search company
acceptable to the Agent and (ii) the Construction Agent shall cause the liens
referenced in such lien searches which are objectionable to the Agent to be
either removed or otherwise handled in a manner reasonably satisfactory to the
Agent;
(v) 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 opinion of the Agent and its respective counsel, the
transactions contemplated by the Operative Agreements do not and will not
subject the Lessor, the Lenders, the Agent or the Holders 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 shall have received a fully
executed copy of each of the Operative Agreements;
(y) since the date of the most recent audited financial statements (as
delivered pursuant to the requirements of the Lessee Credit Agreement) of the
Lessee, there shall not have occurred any event, condition or state of facts
which shall have or could
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reasonably be expected to have a Material Adverse Effect, other than as
specifically contemplated by the Operative Agreements;
(z) as of the Initial Closing Date only, the Agent shall have received an
Officer's Certificate, dated as of the Initial Closing Date, of the Lessee in
the form attached hereto as Exhibit C or in such other form as is acceptable to
the Agent stating that (i) each and every representation and warranty of the
Lessee contained in the Operative Agreements to which it is a party is true and
correct on and as of the Initial Closing Date; (ii) no Default or Event of
Default has occurred and is continuing under any Operative Agreement; (iii)
each Operative Agreement to which the Lessee is a party is in full force and
effect with respect to it; and (iv) the Lessee has duly performed and complied
with all covenants, agreements and conditions contained herein or in any
Operative Agreement required to be performed or complied with by it on or prior
to the Initial Closing Date;
(aa) as of the Initial Closing Date only, the Agent shall have received
(i) a certificate of the Secretary or an Assistant Secretary of the Lessee,
dated as of the Initial Closing Date, in the form attached hereto as Exhibit D
or in such other form as is acceptable to the Agent attaching and certifying as
to (1) the resolutions of its Board of Directors duly authorizing the
execution, delivery and performance by the Lessee of each of the Operative
Agreements to which it is or will be a party, (2) its certificate of
incorporation 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 its behalf the Operative
Agreements to which it is or will be a party and (ii) a good standing
certificate (or local equivalent) from the appropriate office of the respective
states where the Lessee is incorporated and where the principal place of
business of the Lessee is located as to its good standing in each such state;
(bb) as of the Initial Closing Date only, the Agent shall have received an
Officer's Certificate of the Lessor dated as of the Initial Closing Date in
the form attached hereto as Exhibit E or in such other form as is acceptable to
the Agent, stating that (i) each and every representation and warranty of the
Lessor contained in the Operative Agreements to which it is a party is true and
correct on and as of the Initial Closing Date, (ii) each Operative Agreement to
which the Lessor is a party is in full force and effect with respect to it and
(iii) the Lessor has duly performed and complied with all covenants, agreements
and conditions contained herein or in any Operative Agreement required to be
performed or complied with by it on or prior to the Initial Closing Date;
(cc) as of the Initial Closing Date only, the Agent shall have received
(i) a certificate of the Secretary, an Assistant Secretary, Trust Officer or
Vice President of the Trust Company in the form attached hereto as Exhibit F or
in such other form as is acceptable to the Agent, 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
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recent date by an appropriate officer of the Trust Company 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 Office of the Comptroller of the Currency;
(dd) as of the Initial Closing Date only, counsel for the Lessor
acceptable to the Agent shall have issued to the Lessee, the Holders, the
Lenders and the Agent its opinion in the form attached hereto as Exhibit G or
in such other form as is reasonably acceptable to the Agent;
(ee) as of the Initial Closing Date only, the Construction Agent shall have
caused to be delivered to the Agent a legal opinion in the form attached hereto
as Exhibit H or in such other form as is acceptable to the Agent, addressed to
the Lessor, the Agent, the Lenders and the Holders, from ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ LLP;
(ff) [RESERVED];
(gg) [RESERVED]; and
(hh) as of the Initial Closing Date, the Agent shall have received (i) the
Raytheon Indemnity Assignment, (ii) the ▇▇▇▇▇▇▇▇▇ Sublease, (iii) the
Collateral Assignment of Sublease and (iv) the Purchase Agreement Assignment.
5.4 CONDITIONS PRECEDENT FOR THE LESSOR, THE AGENT, THE LENDERS AND THE HOLDERS
RELATING TO THE ADVANCE OF FUNDS AFTER THE ACQUISITION ADVANCE.
The obligations of the Holders to make Holder Advances, and the Lenders to
make Loans in connection with all requests for Advances subsequent to the
acquisition of a Property (and to pay the Transaction Expenses 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 on the date of such Advance 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 (including without limitation the Incorporated
Representations and Warranties);
(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 each such date;
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(c) the Agent 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 Available Commitments and the Available
Commitments and the Available Holder Commitment (after deducting the Unfunded
Amount) will be sufficient to complete the Improvements;
(e) there shall not have occurred and be continuing any Default or Event
of Default under any of the Operative Agreements (other than a Default that
would be cured upon application of the proceeds of such Advance, provided that
such proceeds are so applied or provision reasonably satisfactory to the Agent
shall have been made such that the proceeds will be so applied) and no Default
or Event of Default under any of the Operative Agreements will have occurred
after giving effect to the Construction Advance requested by the applicable
Requisition;
(f) the title insurance policy 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 Construction Budget referred to in subparagraph
(d) above and there shall be no title change or exception objectionable to the
Agent in its reasonable discretion;
(g) prior to or in connection with any request for an Advance for Hard
Costs respecting any Property, the Construction Agent shall have delivered to
the Agent copies of the Plans and Specifications and the final Construction
Budget for the applicable Improvements;
(h) the Construction Agent shall have delivered to the Agent invoices
for, or other reasonably satisfactory evidence of, any Transaction Expenses
that are to be paid with the Advance;
(i) the Construction Agent shall have delivered, or caused to be
delivered to the Agent, invoices, Bills of Sale or other documents reasonably
acceptable to the Agent, in each case with regard to any Equipment or other
components of such Property then being acquired with the proceeds of the Loans
and Holder Advances and naming the Lessor as purchaser and transferee;
(j) 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;
(k) since the date of the most recent audited Financial Statements (as
such term is defined in the Lessee Credit Agreement) of the Lessee, there shall
not have
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occurred any event, condition or state of facts which shall have or could
reasonably be expected to have a Material Adverse Effect, other than as
specifically contemplated by the Operative Agreements;
(l) in the good faith opinion of the Agent and its counsel, the
transactions contemplated by the Operative Agreements do not and will not
subject the Lessor, the Lenders, the Agent or the Holders to any adverse
regulatory prohibitions, constraints, penalties or fines;
(m) prior to or in connection with any request for an Advance for
Hard Costs respecting any Property, the Construction Agent shall have
caused an Appraisal regarding such Property to be provided to the Agent
from an appraiser selected by the Agent;
(n) prior to or in connection with any request for an Advance for
Hard Costs respecting any portion of any Property where existing
improvements are to be removed or demolished, the Construction Agent shall
use commercially reasonable efforts to cause to be delivered to the Agent a
guaranteed maximum price, bonded demolition contract for such removal or
demolition, in form and substance reasonably acceptable to the Agent; and
(o) prior to or in connection with any request for an Advance for
Hard Costs respecting any Property, the Agent shall have received the EPA
Comfort Letter.
5.5. ADDITIONAL REPORTING AND DELIVERY REQUIREMENTS ON COMPLETION DATE AND
ON CONSTRUCTION PERIOD TERMINATION DATE.
On or prior to the Completion Date for each Property, the Construction
Agent shall deliver to the Agent an Officer's Certificate in the form attached
hereto as Exhibit I or in such other form as is acceptable to the Agent
specifying (a) the address for such Property, (b) the Completion Date for such
Property, (c) detailed, itemized documentation supporting the asserted Property
Cost figures and (d) that all representations and warranties of the Construction
Agent and Lessee in each of the Operative Agreements and each certificate
delivered pursuant thereto (including without limitation the Incorporated
Representation and Warranties) are true and correct as of the Completion Date.
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 each
Property, the Construction Agent shall deliver or cause to be delivered to the
Agent (unless previously delivered to the Agent) originals of the following,
each of which shall be in form and substance acceptable to the Agent, in its
reasonable discretion: (w) 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 and, if
endorsed, the endorsement shall not include a title change or exception
objectionable to the Agent; (x) an as-built survey for such Property, (y) ACCORD
Evidence of Insurance and/or a certified copy of the insurance policies
respecting such Property as required hereunder and under the Lease Agreement,
and (z) if reasonably requested by the Agent, amendments to the Lessor Financing
Statements executed by
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the appropriate parties. In addition, on the Completion Date for such Property
the Construction Agent covenants and agrees that the recording fees, documentary
stamp taxes or similar amounts required to be paid in connection with the
related Mortgage Instrument shall be paid in an amount required by applicable
law, subject, however, to the obligations of the Lenders and the Holders to
fund such costs to the extent required pursuant to Section 7.1.
5.6 THE CONSTRUCTION AGENT DELIVERY OF CONSTRUCTION BUDGET MODIFICATIONS.
The Construction Agent covenants and agrees to deliver to the Agent each
month notification of any modification to any Construction Budget regarding any
Property if such modification increases the cost to construct such Property;
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.
5.7 RESTRICTIONS ON LIENS.
On each Property Closing Date, the Construction Agent shall cause each
Property acquired 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). On each date a
Property is either sold to a third party 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 such Property to be free and
clear of all Liens (other than Lessor Liens and such other Liens that are
expressly set forth as title exceptions on the title commitment issued under
Section 5.3(g) with respect to such Property, to the extent such title
commitment has been approved by the Agent).
5.8 PAYMENTS.
All payments of principal, interest, Holder Advances, Holder Yield and
other amounts 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 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, Holder Yield and fees payable pursuant to the Operative Agreements,
as applicable and as the case may be.
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5.9. UNILATERAL RIGHT TO INCREASE THE HOLDER COMMITMENTS AND THE LENDER
COMMITMENTS.
Notwithstanding any other provision of any Operative Agreement or any
objection by any Person (including without limitation any objection by any
Credit Party), (a) each Holder, in its sole discretion, may unilaterally elect
to increase its Holder Commitment in order to fund amounts due and owing
pursuant to Sections 7.1(a), 7.1(b) and/or 11.8, and such other amounts payable
by the Lessor during the Construction Period pursuant to the Operative
Agreements, and (b) each Lender, in its sole discretion, may unilaterally elect
to increase its Lender Commitment in order to fund amounts due and owing
pursuant to Sections 7.1(a), 7.1(b) and/or 11.8, and such other amounts payable
by the Lessor during the Construction Period pursuant to the Operative
Agreements.
5.10. JOINDER AGREEMENT REQUIREMENTS.
Each Domestic Subsidiary of each Credit Party and the Parent formed or
acquired subsequent to the Initial Closing Date shall become a Guarantor and
shall satisfy the following conditions within thirty (30) days after its
formation or acquisition:
(a) such Domestic Subsidiary or Parent, as the case may be, shall
execute and deliver to the Agent a Joinder Agreement in the form attached
hereto as Exhibit K;
(b) such Domestic Subsidiary or Parent, as the case may be, shall
have delivered to the Agent (x) an Officer's Certificate of such Domestic
Subsidiary or Parent, as the case may be, in the form attached hereto as
Exhibit C, (y) a certificate of the Secretary or an Assistant Secretary of
such Domestic Subsidiary or Parent, as the case may be, in the form
attached hereto as Exhibit D and (z) good standing certificates (or local
equivalent) from the respective states where such Domestic Subsidiary or
Parent, as the case may be, is incorporated or organized and where the
principal place of business of such Domestic subsidiary or Parent, as the
case may be, is located as to its good standing in each such state;
(c) such Domestic Subsidiary or Parent, as the case may be, shall
have delivered to the Agent an opinion of counsel (acceptable to the
Agent) in the form attached hereto as Exhibit H-1 or such other form as is
reasonably acceptable to the Agent and such Domestic Subsidiary or Parent,
as the case may be; and
(d) the Agent shall have received such other documents,
certificates and information as the Agent shall have reasonably requested.
5.11. PROPERTY COST AS OF THE RENT COMMENCEMENT DATE.
Upon receipt of the Officer's Certificate from the Construction Agent
pursuant to Section 5.5, the Agent shall promptly deliver a notice to the
Lessee specifying the amount allocable to the Property Cost respecting the
Land, as identified on any Lease Supplement relating to Land,
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and the amount allocable to the Property Cost respecting the Improvements, as
identified on any Lease Supplement relating to Improvements. Such amounts
identified by the Agent shall be conclusive, absent manifest error.
SECTION 6. REPRESENTATIONS AND WARRANTIES.
6.1. REPRESENTATIONS AND WARRANTIES OF THE BORROWER.
Effective as of the Initial Closing Date and the date of each Advance, the
Trust Company in its individual capacity and as the Borrower, as indicated,
represents and warrants to each of the other parties hereto as follows,
provided, that the representations in the following paragraphs (h), (j) and (k)
are made solely in its capacity as the Borrower:
(a) It is a national banking association and is duly organized and
validly existing and in good standing under the laws of the United States of
America and has the power and authority to enter into and perform its
obligations under the Trust Agreement and (assuming due authorization, execution
and delivery of the Trust Agreement by the Holders) has the corporate and trust
power and authority to act as the Owner Trustee and to enter into and perform
the obligations under each of the other Operative Agreements to which the Trust
Company or the Owner Trustee, as the case may be, is or will be a party and each
other agreement, instrument and document to be executed and delivered by it on
or before such Closing Date in connection with or as contemplated by each such
Operative Agreement to which the Trust Company or the Owner Trustee, as the case
may be, is or will be a party;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party, either in its individual capacity
or (assuming due authorization, execution and delivery of the Trust Agreement
by the Holders) as the Owner Trustee, as the case may be, has been duly
authorized by all necessary action on its part and neither the execution and
delivery thereof, nor the consummation of the transactions contemplated
thereby, nor compliance by it with any of the terms and provisions thereof (i)
does or will require any approval or consent of any trustee or holders of any
of its indebtedness or obligations, (ii) does or will contravene any Legal
Requirement relating to its banking or trust powers, (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) would materially and adversely affect its ability, in its individual
capacity or as the Owner Trustee, to perform its obligations under the
Operative Agreements to which it is a party or (iv) does or will require any
Governmental Action by any Governmental Authority regulating its banking or
trust powers;
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(c) The Trust Agreement and, assuming the Trust Agreement is the legal,
valid and binding obligation of the Holders, each other Operative Agreement to
which the Trust Company or the Owner Trustee, as the case may be, is or will be
a party have been, or on or before such Closing Date will be, duly executed and
delivered by the Trust Company or the Owner Trustee, as the case may be, and
the Trust Agreement and each such other Operative Agreement to which the Trust
Company or the Owner Trustee, as the case may be, is a party constitutes, or
upon execution and delivery will constitute, a legal, valid and binding
obligation enforceable against the Trust Company or the Owner Trustee, as the
case may be, in accordance with the terms thereof;
(d) There is no action or proceeding pending or, to its knowledge,
threatened to which it is or will be a party, either in its individual
capacity or as the Owner Trustee, before any Governmental Authority that, if
adversely determined, would materially and adversely affect its ability, in its
individual capacity or as the Owner Trustee, to perform its obligations under
the Operative Agreements to which it is a party or would question the validity
or enforceability of any of the Operative Agreements to which it is or will
become a party;
(e) It, either in its individual capacity or as the Owner Trustee, has not
assigned or transferred any of its right, title or interest in or under the
Lease, the Agency Agreement or its interest in any Property or any portion
thereof, except in accordance with the Operative Agreements;
(f) No Default of Event or 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 Loans and Holder Advances shall not be applied by the Owner
Trustee, either in its individual capacity or as the Owner Trustee, for any
purpose other than the purchase and/or lease of the Properties, the
acquisition, installation and testing of the Equipment, the construction of
Improvements and the payment of Transaction Expenses and the fees, expenses and
other disbursements referenced in Sections 7.1(a) and 7.1(b) of this Agreement,
in each case which accrue prior to the Rent Commencement Date with respect to a
particular Property;
(h) Neither the Owner Trustee nor any Person authorized by the Owner
Trustee to act on its behalf has offered or sold any interest in the Trust
Estate or the Notes, or in any similar security relating to a Property, or in
any security the offering of which for the purposes of the Securities Act would
be deemed to be part of the same offering as the offering of the aforementioned
securities to, or solicited any offer to acquire any of the same from, any
Person other than, in the case of the Notes, the Agent, and neither the Owner
Trustee nor any Person authorized by the Owner Trustee to act on its behalf
will take any action which would subject, as a direct result of such action
alone, the issuance or sale of any interest in the Trust Estate or the Notes to
the provisions of
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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 Owner Trustee'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 ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇;
(j) The Owner Trustee 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 or carrying any margin stock (within the
meaning of Regulation U of the Board of Governors of the Federal
Reserve system of the United States), and no part of the proceeds of
the Loans or the Holder Advances 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 G, T,
U, or X of the Board of Governors of the Federal Reserve System of the
United States;
(k) The Owner Trustee is not an "investment company" or a company
controlled by an "investment company" within the meaning of the
Investment Company Act;
(l) Each Property is free and clear of all Lessor Liens attributable to the
Owner Trustee, either in its individual capacity or as the Owner
trustee; and
(m) The Owner Trustee, in its trust capacity, is not a party to any
documents, instruments or agreements other than the Operative
Agreements executed by the Owner Trustee, in its trust capacity.
6.2 REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES.
Effective as of the Initial Closing Date, the date of each Advance, the
date each Domestic Subsidiary or Parent, as the case may be, delivers a Joinder
Agreement and the Rent Commencement Date, each Credit Party represents and
warrants to each of the other parties hereto that:
(a) The Lessee has delivered to the Agent the financial statements and
other reports referred to in Section 8.3A(a)(i) and (ii) hereof;
(b) The execution and delivery by each Credit Party of this Agreement and
the other applicable Operative Agreements as of such date and the
performance by each Credit Party of its respective obligations under
this Agreement and the other applicable Operative Agreements are within
the corporate, partnership or limited liability company (as the case
may be) powers of each Credit Party, have been duly authorized by all
necessary corporate action on the part of each Credit Party (including
without limitation
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any necessary shareholder action), have been duly executed and delivered, have
received all necessary governmental approval, and do not and will not (i)
violate any Legal Requirement which is binding on any Credit Party or any of
its Subsidiaries, (ii) contravene or conflict with, or result in a breach of,
any provision of the Articles of Incorporation, By-Laws or other organizational
documents of any Credit Party or any of its Subsidiaries or of any agreement,
indenture, instrument or other document which is binding on any Credit Party or
any of its Subsidiaries or (iii) 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 any Credit Party or any of its Subsidiaries;
(c) This Agreement and the other applicable Operative Agreements executed
prior to and as of such date by any Credit Party, constitute the legal, valid
and binding obligation of such Credit Party, as applicable, enforceable against
the such Credit Party, as applicable, in accordance with their terms. Each
Credit Party has executed the various Operative Agreements required to be
executed by such Credit Party as of such date;
(d) There are no material actions, suits or proceedings pending or, to
our knowledge, threatened against any Credit Party in any court or before any
Governmental Authority (nor shall any order, judgment or decree have been
issued or proposed to be issued by any Governmental Authority to set aside,
restrain, enjoin or prevent the full performance of any Operative Agreement or
any transaction contemplated thereby) that (i) concern any Property or any
Credit Party's interest therein, (ii) question the validity or enforceability
of any Operative Agreement or any transaction described in the Operative
Agreements or (iii) shall have or could reasonably be expected to have a
Material Adverse Effect; provided, for purposes of disclosure, the Credit
Parties have described the litigation set forth on Exhibit J;
(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, 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 of any Operative Agreement, (ii) the legality, validity, binding
effect or enforceability of any Operative Agreement, (iii) the acquisition,
ownership, construction, completion, occupancy, operation, leasing or
subleasing of any Property or (iv) any Advance, in each case, except those
which have been obtained and are in full force and effect;
(f) Upon the execution and delivery of the Lease and each Lease
Supplement to the Lease, (i) the Lessee will have unconditionally accepted the
Property subject to the Lease Supplement and will have a valid and subsisting
leasehold interest in such Property, subject only to the Permitted Liens, and
(ii) no offset will exist with respect to any Rent or other sums payable under
the Lease;
(g) Except as otherwise contemplated by the Operative Agreements, the
Construction Agent shall not use the proceeds of any Holder Advance or Loan for
any
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purpose other than the purchase and/or lease of the Properties, the
acquisition, installation and testing of the Equipment, the construction of
Improvements and the payment of Transaction Expenses, in each case which accrue
prior to the Rent Commencement Date with respect to a particular Property;
(h) All information (including without limitation the financial statements
and other reports delivered to the Agent pursuant to Section 8.3A(a)(i) and
(ii)) heretofore or contemporaneously herewith furnished by each Credit Party or
its Subsidiaries to the Agent, the Owner Trustee, any Lender or any Holder for
purposes of or in connection with this Agreement and the transactions
contemplated hereby is, and all information hereafter furnished by or on behalf
of each Credit Party or its Subsidiaries to the Agent, the Owner Trustee, any
Lender or any Holder pursuant hereto or in connection herewith will be, true
and accurate in every material respect on the date as of which such information
is dated or certified, and such information, taken as a whole, does not and will
not omit to state any material fact necessary to make such information, taken
as a whole, not misleading;
(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 ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇;
(j) The representations and warranties of each Credit Party set forth in
any of the Operative Agreements are true and correct in all material respects
on and as of each such date as if made on and as of such date. Each Credit
Party is in all material respects in compliance with its respective obligations
under the Operative Agreements and there exists no Default or 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. No Default or Event of Default will occur under
any of the Operative Agreements as a result of, or after giving effect to, the
Advance requested by the Requisition on the date of each Advance;
(k) As of each Property Closing Date, the date of each subsequent Advance
and the Rent Commencement Date only, each Property then being financed consists
of (i) unimproved Land or (ii) Land and existing Improvements thereon which
Improvements are either suitable for occupancy at the time of acquisition or
will be constructed, renovated, modified or demolished in accordance with the
terms of this Agreement. Each Property then being financed is located at the
location set forth on the applicable Requisition, each of which is in one (1)
of the Approved States;
(l) As of each Property Closing Date, the date of each subsequent Advance
and the Rent Commencement Date only, the Lessor has good and marketable fee
simple title to each Property, subject only to (i) such Liens referenced in
Sections 6.2(r)(i) and
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6.2(r)(ii) on the applicable Property Closing Date and (ii) subject to Section
5.7, Permitted Liens after the applicable Property Closing Date;
(m) As of each Property Closing Date, the date of each subsequent Advance
and the Rent Commencement Date only, no portion of any Property is located in
an area identified as a special flood hazard area by the Federal Emergency
Management Agency or other applicable agency, or if any such Property is
located in an area identified as a special flood hazard area by the Federal
Emergency Management Agency or other applicable agency, then flood insurance
has been obtained for such Property in accordance with Section 14.2(b) of the
Lease and in accordance with the National Flood Insurance Act of 1968, as
amended;
(n) As of each Property Closing Date, the date of each subsequent Advance
and the Rent Commencement Date only, each Property complies with all Insurance
Requirements and all standards of Lessee with respect to similar properties
owned by Lessee;
(o) As of each Property Closing Date, the date of each subsequent Advance
and the Rent Commencement Date only, each Property complies with all Legal
Requirements as of such date (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; provided, however,
that solely with respect to the Pre-Existing Environmental Conditions,
compliance with the CD, and with any and all other applicable orders and
directives of federal, state and local Governmental Authorities, shall
constitute compliance with Legal Requirements;
(p) As of each Property Closing Date, the date of each subsequent Advance
and the Rent Commencement Date only, all utility services and facilities
necessary for the construction and operation of the Improvements and the
installation and operation of the Equipment regarding each Property (including
without limitation gas, electrical, water and sewage services and facilities)
are available at the Land or will be constructed prior to the Completion Date
for such Property;
(q) As of each Property Closing Date, the date of each subsequent Advance
and the Rent Commencement Date only, acquisition, installation and testing of
the Equipment (if any) and construction of the Improvements (if any) to such
date shall have been performed in a good and workmanlike manner, substantially
in accordance with the applicable Plans and Specifications;
(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 ratable benefit of the Lenders and the Holders, as their
respective interests appear in the Operative Agreements, and such security
interests and Liens are subject to
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no other Liens other than (A) Liens that are expressly set forth as title
exceptions on the title commitment issued under Section 5.3(g) with respect
to the applicable Property, to the extent such title commitment has been
approved by the Agent and (B) from and after the applicable Property
Closing Date, Permitted Liens. Upon recordation of the Mortgage Instrument
in the real estate recording office in the applicable Approved State
identified by the Construction Agent or the Lessee, the Lien created by the
Mortgage Instrument in the real property described therein shall be a
perfected first priority mortgage Lien on such real property in favor of
the Agent, for the ratable benefit of the Lenders and the Holders, as their
respective interests appear in the Operative Agreements. 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 Lender 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 Lenders and
the Holders, as their respective interests appear in the Operative
Agreements;
(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, each 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 under Section 5.3(g) with respect to the
applicable Property, to the extent such title commitment has been approved
by the Agent. Upon recordation of the memorandum of the Lease Agreement (or
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 such real property in favor
of the Agent, for the ratable benefit of the Lenders and the Holders, as
their respective interests appear in the Operative Agreements. To the
extent that the security interests in the portion of any Property comprised
of personal property can be perfected by the filing in the filing offices
in the State of California or elsewhere identified by the Construction
Agent or the Lessee upon filing of the Lessor Financing Statements in such
filing offices, a security interest 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 ratable benefit of the
Lenders and the Holders, as their respective interests appear in the
Operative Agreements;
(s) The Plans and Specifications for each 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
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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);
(t) As of the Rent Commencement Date only, each Property shall be
improved in accordance with the applicable Plans and Specifications in a
good and workmanlike manner and shall be operational;
(u) As of each Property Closing Date only, each Property has been
acquired at a price that is not in excess of fair market value; and
(v) Each Credit Party has (i) initiated a review and assessment of
all areas within its and each of its Subsidiaries' business and operations
(including those affected by suppliers, vendors and customers of each
Credit Party and its Subsidiaries) that could be adversely affected by the
Year 2000 Problem, (ii) developed a plan and timeline for addressing the
Year 2000 Problem on a timely basis and (iii) to date, implemented that
plan in accordance with that timetable. Based on the foregoing, each Credit
Party believes that all computer applications (including those of
suppliers, vendors and customers of each Credit Party and its Subsidiaries)
that are material to its or any of its Subsidiaries' business and
operations are reasonably expected on a timely basis to be able to perform
properly date-sensitive functions for all dates before and after January 1,
2000 (that is, be "Year 2000 Compliant"), except to the extent that a
failure to do so shall not have and could not reasonably be expected to
have a Material Adverse Effect.
SECTION 6B. GUARANTY
6B.1. GUARANTY OF PAYMENT AND PERFORMANCE.
Subject to Section 6B.7, each Guarantor hereby, jointly and severally,
unconditionally guarantees to each Financing Party the prompt payment and
performance of the Company Obligations in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration or otherwise) or when such
is otherwise to be performed; provided, notwithstanding the foregoing, the
obligations of the Guarantors under this Section 6B shall not constitute a
direct guaranty of the indebtedness of the Lessor evidenced by the Notes but
rather a guaranty of the Company Obligations arising under the Operative
Agreements. This Section 6B is a guaranty of payment and performance and not of
collection and is a continuing guaranty and shall apply to all Company
Obligations whenever arising. All rights granted to the Financing Parties under
this Section 6B shall be subject to the provisions of Section 8.2(h) and 8.6.
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6B.2. OBLIGATIONS UNCONDITIONAL.
Each Guarantor agrees that the obligations of the Guarantors hereunder are
absolute and unconditional, irrespective of the value, genuineness, validity,
regularity or enforceability of any of the Operative Agreements, or any other
agreement or instrument referred to therein, or any substitution, release or
exchange of any other guarantee of or security for any of the Company
Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety, guarantor or
co-obligor, it being the intent of this Section 6B.2 that the obligations of the
Guarantors hereunder shall be absolute and unconditional under any and all
circumstances. Each Guarantor agrees that this Section 6B may be enforced by the
Financing Parties without the necessity at any time of resorting to or
exhausting any other security or collateral and without the necessity at any
time of having recourse to the Notes, the Certificates or any other of the
Operative Agreements or any collateral, if any, hereafter securing the Company
Obligations or otherwise and each Guarantor hereby waives the right to require
the Financing Parties to proceed against the Construction Agent, the Lessee or
any other Person (including without limitation a co-guarantor) or to require the
Financing Parties to pursue any other remedy or enforce any other right. Each
Guarantor further agrees that it hereby waives any and all right of subrogation,
indemnity, reimbursement or contribution against the Lessee and the Construction
Agent or any other Guarantor of the Company Obligations for amounts paid under
this Section 6B until such time as the Loans, Holder Advances, accrued but
unpaid interest, accrued but unpaid Holder Yield and all other amounts owing
under the Operative Agreements have been paid in full. Without limiting the
generality of the waiver provisions of this Section 6B, each Guarantor hereby
waives any rights to require the Financing Parties to proceed against the
Construction Agent, the Lessee or any co-guarantor or to require Lessor to
pursue any other remedy or enforce any other right. Each Guarantor further
agrees that nothing contained herein shall prevent the Financing Parties from
suing on any Operative Agreement or foreclosing any security interest in or Lien
on any collateral, if any, securing the Company Obligations or from exercising
any other rights available to it under any Operative Agreement, or any other
instrument of security, if any, and the exercise of any of the aforesaid rights
and the completion of any foreclosure proceedings shall not constitute a
discharge of any Guarantor's obligations hereunder; it being the purpose and
intent of each Guarantor that its obligations hereunder shall be absolute,
independent and unconditional under any and all circumstances; provided that any
amounts due under this Section 6B which are paid to or for the benefit of any
Financing Party shall reduce the Company Obligations by a corresponding amount
(unless required to be rescinded at a later date). Neither any Guarantor's
obligations under this Section 6B nor any remedy for the enforcement thereof
shall be impaired, modified, changed or released in any manner whatsoever by an
impairment, modification, change, release or limitation of the liability of the
Construction Agent or the Lessee or by reason of the bankruptcy or insolvency of
the Construction Agent or the Lessee. Each Guarantor waives any and all notice
of the creation, renewal, extension or accrual of any of the Company Obligations
and notice of or proof of reliance by any Financing Party upon this Section 6B
or acceptance of this Section 6B. Each Guarantor also expressly waives any and
all benefits under the California Civil Code Sections 2787 to 2855, inclusive.
The Company Obligations shall conclusively be deemed to have been created,
contracted or incurred, or renewed, extended, amended or waived, in reliance
upon this Section 6B. All dealings between the Construction Agent, the Lessee
and any of the guarantors, on the one
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hand, and the Financing Parties, on the other hand, likewise shall be
conclusively presumed to have been had or consummated in reliance upon this
Section 6B.
6B.3. Modifications.
Each Guarantor agrees that (a) all or any part of the security now or
hereafter held for the Company Obligations, if any, may be exchanged,
compromised or surrendered from time to time; (b) no Financing Party shall have
any obligation to protect, perfect, secure or insure any such security
interests, liens or encumbrances now or hereafter held, if any, for the Company
Obligations or the properties subject thereto; (c) the time or place of payment
of the Company Obligations may be changed or extended, in whole or in part, to
a time certain or otherwise, and may be renewed or accelerated, in whole or in
part; (d) the Construction Agent, the Lessee and any other party liable for
payment under the Operative Agreements may be granted indulgencies generally;
(e) any of the provisions of the Notes, the Certificates or any of the other
Operative Agreements may be modified, amended or waived; (f) any party
(including any co-guarantor) liable for the payment thereof may be granted
indulgences or be released; and (g) any deposit balance for the credit of the
Construction Agent, the Lessee or any other party liable for the payment of the
Company Obligations or liable upon any security therefor may be released, in
whole or in part, at, before or after the stated, extended or accelerated
maturity of the Company Obligations, all without notice to or further assent by
such Guarantor, which shall remain bound thereon, notwithstanding any such
exchange, compromise, surrender, extension, renewal, acceleration,
modification, indulgence or release.
6B.4. Waiver of Rights.
Each Guarantor expressly waives to the fullest extent permitted by
applicable law: (a) notice of acceptance of this Section 6B by any Financing
Party and of all extensions of credit or other Advances to the Construction
Agent and the Lessee by the Lenders pursuant to the terms of the Operative
Agreements; (b) presentment and demand for payment or performance of any of the
Company Obligations; (c) protest and notice of dishonor or of default with
respect to the Company Obligations or with respect to any security therefor;
(d) notice of any Financing Party obtaining, amending, substituting for,
releasing, waiving or modifying any security interest, lien or encumbrance, if
any, hereafter securing the Company Obligations, or any Financing Party's
subordinating, compromising, discharging or releasing such security interests,
liens or encumbrances, if any; and (e) all other notices to which such
Guarantor might otherwise be entitled. Notwithstanding anything to the contrary
herein, (i) each Guarantor's payments hereunder shall be due five (5) Business
Days after written demand by the Agent for such payment (unless the Company
Obligations are automatically accelerated pursuant to the applicable provisions
of the Operative Agreements in which case the Guarantors' payments shall be
automatically due) and (ii) any modification of the Operative Agreements which
has the effect of increasing the Company Obligations shall not be enforceable
against a Guarantor unless such Guarantor executes the document evidencing such
modification or otherwise reaffirms its guaranty in writing in connection with
such modification.
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6B.5. REINSTATEMENT.
The obligations of the Guarantors under this Section 6B shall be
automatically reinstated if and to the extent that for any reason any payment
by or on behalf of any Person in respect of the Company Obligations is
rescinded or must be otherwise restored by any holder of any of the Company
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will 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.
6B.6. REMEDIES.
The Guarantors agree that, as between the Guarantors, on the one hand, and
each Financing Party, on the other hand, the Company Obligations may be declared
to be forthwith due and payable as provided in the applicable provisions of the
Operative Agreements (and shall be deemed to have become automatically due and
payable in the circumstances provided therein) notwithstanding any stay,
injunction or other prohibition preventing such declaration (or preventing such
Company Obligations from becoming automatically due and payable) as against any
other Person and that, in the event of such declaration (or such Company
Obligations being deemed to have become automatically due and payable), such
Company Obligations (whether or not due and payable by any other Person) shall
forthwith become due and payable by the Guarantors in accordance with the
applicable provisions of the Operative Agreements.
6B.7. LIMITATION OF GUARANTY.
Notwithstanding any provision to the contrary contained herein or in any
of the other Operative Agreements, to the extent the obligations of any
Guarantor shall be adjudicated to be invalid or unenforceable for any reason
(including without limitation because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations of such
Guarantor hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including without limitation
the Bankruptcy Code).
Subject to Section 6B.5, upon the satisfaction of the Company Obligations
in full, regardless of the source of payment, the Guarantors' obligations
hereunder shall be deemed satisfied, discharged and terminated other than
indemnifications set forth herein that expressly survive.
6B.8. PAYMENT OF AMOUNTS TO THE AGENT.
Each Financing Party hereby instructs each Guarantor, and each Guarantor
hereby acknowledges and agrees, that until such time as the Loans and the
Holder Advances are paid in
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full and the Liens evidenced by the Security Agreement and the Mortgage
Instruments have been released any and all Rent (excluding Excepted Payments
which shall be payable to each Holder or other Person as appropriate) 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 which shall be payable to each Holder or
other Person as appropriate) 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.
SECTION 7. PAYMENT OF CERTAIN EXPENSES.
7.1. TRANSACTION EXPENSES.
(a) The Lessor agrees on the Initial Closing Date, to pay, or cause to
be paid, all Transaction Expenses arising from the Initial Closing Date,
including without limitation all reasonable fees, expenses and
disbursements of the various legal counsels for the Lessor and the Agent in
connection with the transactions contemplated by the Operative Agreements
and incurred in connection with such Initial Closing Date, the initial fees
and expenses of the Owner Trustee due and payable on such Initial 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 Initial Closing Date;
provided, however, the Lessor shall pay such amounts described in this
Section 7.1(a) only if funds are made available by the Lenders and the
Holders in an amount sufficient to allow such payment and without regard to
whether such amounts are referenced in any Requisition. On the Initial
Closing Date after satisfaction of the conditions precedent for such date
(excluding the requirement that a Requisition be delivered), the Holders
shall make Holder Advances and the Lenders shall make Loans to the Lessor
to pay for the Transaction Expenses, fees, expenses and other disbursements
referenced in this Section 7.1(a).
(b) Assuming no Default (other than a Default that would be cured upon
application of the proceeds of such Advance, provided such proceeds are so
applied or provision reasonably satisfactory to the Agent shall have been
made such that such proceeds will be so applied) or Event of Default shall
have occurred and be continuing and only for the period prior to the Rent
Commencement Date, the Lessor agrees on each Property 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 the various legal counsels
for the Lessor and the Agent in connection with the transactions
contemplated by the Operative Agreements and billed in connection with such
Advance or such Completion Date, all amounts described in Section 7.1(a) of
this Agreement which have not been previously paid, the annual fees and
reasonable out-of-pocket expenses of the Owner Trustee, 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) and
all other reasonable fees,
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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), 7.3(d) and 7.4; provided however, the Lessor shall pay such
amounts described in this Section 7.1(b) only if funds are made available by
the Lenders and the Holders in an amount sufficient to allow such payment and
without regard to whether such amounts are referenced in any Requisition. On
each Property Closing Date, on the date of any Construction Advance or any
Completion Date, after satisfaction of the conditions precedent for such date
(excluding the requirement that a Requisition be delivered), the Holders shall
make a Holder Advance and the Lenders shall make Loans to the Lessor to pay for
the Transaction Expenses, fees, expenses and other disbursements referenced in
this Section 7.1(b).
(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.
(d) The Lessor shall use commercially reasonable efforts to cause invoices
respecting the Transaction Expenses set forth in this Section 7.1 of legal
counsel and other professional service providers retained by the Lessor to be
provided to the Lessee; provided, however, the failure of the Lessor to cause
such invoices to be provided shall in no way excuse or otherwise affect the
payment obligations for such Transaction Expenses.
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.
7.3. CERTAIN FEES AND EXPENSES.
The Lessee agrees to pay or cause to be paid (a) the $5,000 initial and
$5,000 annual Owner Trustee's fee and all reasonable expenses of the Owner
Trustee and any co-trustees (including without limitation reasonable counsel
fees and expenses) or any successor owner trustee and/or co-trustee, for acting
as the owner trustee under the Trust Agreement, (b) all reasonable costs and
expenses incurred by the Credit Parties, the Agent, the Lenders, the Holders 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 of consents hereto
or thereto, which have been requested by any Credit Party, the Agent, the
Lenders, the Holders or the Lessor, (c) all reasonable costs and expenses
incurred by the Credit Parties, the Agent, the Lenders, the Holders of the
Lessor in connection with any exercise of remedies under any Operative
Agreement or any purchase of any Property by the Credit Parties or any third
party and (d) all reasonable costs and expenses incurred by the Construction
Agent, the Lessee, the
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Agent, the Lenders, the Holders or the Lessor in connection with any transfer
or conveyance of any Property, whether or not such transfer or conveyance is
ultimately accomplished.
7.4. COMMITMENT FEE.
During the Commitment Period, the Lessee agrees to pay or to cause to
be paid to the Agent for the account of (a) the Lenders, respectively, a
commitment fee (the "Lender Commitment Fee") equal to the product of the
Commitment of each Lender multiplied by a per annum rate equal to the
Applicable Percentage for the Lender Commitment Fee and (b) the Holders,
respectively, a commitment fee (the "Holder Commitment Fee") equal to the
product of the Holder Commitment of each Holder multiplied by a per annum rate
equal to the Applicable Percentage for the Holder Commitment Fee. Such
Commitment Fees shall be calculated on the basis of a year of three hundred
sixty (360) days for the actual days elapsed and shall be payable quarterly in
arrears on each Commitment Fee Payment Date. If all or a portion of any such
Commitment Fee shall not be paid when due, such overdue amount shall bear
interest, payable by the Lessee on demand, at a rate per annum equal to the ABR
(or in the case of overdue amounts relating to Holder Commitment Fees, the ABR
plus 1.00%) plus two percent (2%) from the date of such non-payment until such
amount is paid in full.
SECTION 8. OTHER COVENANTS AND AGREEMENTS.
8.1. COOPERATION WITH THE CONSTRUCTION AGENT OR THE LESSEE.
The Holders, the Lenders, the Lessor (at the direction of the Majority
Secured Parties) 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 Holders, the Lenders, the Lessor (at the direction of the
Majority Secured Parties) and the Agent 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 OWNER TRUSTEE AND THE HOLDERS.
Each of the Owner Trustee and the Holders hereby agrees that so long
as this Agreement is in effect:
(a) Neither the Owner Trustee (in its trust capacity or
in its individual capacity) nor any Holder will create or permit to
exist at any time, and each of them 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 Properties attributable
to it; provided, however, that the Owner Trustee and the Holders shall
not be required to so
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discharge any such Lessor Lien while the same is being contested in good faith
by appropriate proceedings diligently prosecuted so long as such proceedings
shall not materially and adversely affect the rights of the Lessee under the
Lease and the other Operative Agreements or involve any material danger of
impairment of the Liens of the Security Documents or of the sale, forfeiture or
loss of, and shall not interfere with the use or disposition of, any Property
or title thereto or any interest therein or the payment of Rent;
(b) Without prejudice to any right under the Trust Agreement of
the Owner Trustee to resign (subject to the requirement set forth in the Trust
Agreement that such resignation shall not be effective until a successor shall
have agreed to accept such appointment), or the Holders' rights under the Trust
Agreement to remove the institution acting as the Owner Trustee (after consent
to such removal by the Agent as provided in the Trust Agreement), each of the
Owner Trustee and the Holders hereby agrees with the Lessee and the Agent (i)
not to terminate or revoke the trust created by the Trust Agreement except as
permitted by Article VIII of the Trust Agreement, (ii) not to amend,
supplement, terminate or revoke or otherwise modify any provision of the Trust
Agreement in such a manner as to adversely affect the rights of any such party
without the prior written consent of such party and (iii) to comply with all of
the terms of the Trust Agreement, the nonperformance of which would adversely
affect such party;
(c) The Owner Trustee or any successor may resign or be removed
by the Holders as the Owner Trustee, a successor Owner Trustee may be appointed
and a corporation may become the Owner Trustee under the Trust Agreement, only
in accordance with the provisions of Article IX of the Trust Agreement and,
with respect to such appointment, with the consent of the Lessee (so long as
there shall be no Lease Event of Default that shall have occurred and be
continuing), which consent shall not be unreasonably withheld or delayed;
(d) The Owner Trustee, in its capacity as the Owner Trustee under
the Trust Agreement, and not in its individual capacity, shall not contract
for, create, incur or assume any Indebtedness, or enter into any business or
other activity or enter into any contracts or agreements, other than pursuant
to or under the Operative Agreements;
(e) The Holders will not instruct the Owner Trustee to take any
action in violation of the terms of any Operative Agreement;
(f) Neither any Holder nor the Owner Trustee shall (i) commence
any case, proceeding or other action with respect to the Owner Trustee under
any existing or future law of any jurisdiction, domestic or foreign, relating
to bankruptcy, insolvency, reorganization, arrangement, winding-up,
liquidation, dissolution, composition or other relief with respect to it or
its debts, or (ii) seek appointment of a receiver, trustee, custodian or other
similar official with respect to the Owner Trustee or for all or any
substantial benefit of the creditors of the Owner Trustee; and neither any
Holder nor the
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Owner Trustee shall take any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any of the acts set forth in this
paragraph;
(g) The Owner Trustee shall give prompt notice to the Lessee, the Holders
and the Agent if the Owner Trustee's principal place of business or chief
executive office, or the office where the records concerning the accounts or
contract rights relating to any Property are kept, shall cease to be located at
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, or if it shall change its
name; and
(h) The Owner Trustee 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 any Property in each case as directed in writing
by the Agent (until such time as the Loans are paid in full, and then by the
Majority Holders) or, in connection with Sections 8.5 and 9.2 hereof, the
Lessee; provided, however, that notwithstanding the foregoing provisions of
this subparagraph (h) the Owner Trustee, the Agent, the Lenders and the Holders
each acknowledge, covenant and agree that neither the Owner Trustee nor the
Agent shall act or refrain from acting, regarding each Unanimous Vote Matter,
until such party has received the approval of each Lender and each Holder
affected by such matter.
8.3. CREDIT PARTY COVENANTS, CONSENT AND ACKNOWLEDGMENT.
(a) Each Credit Party acknowledges and agrees that the Owner Trustee,
pursuant to the terms and conditions of the Security Agreement and the Mortgage
Instruments, shall create Liens respecting the various personal property,
fixtures and real property described therein in favor of the Agent. Each Credit
Party hereby irrevocably consents to the creation, perfection and maintenance
of such Liens until such liens are subject to release in accordance with this
Agreement and the other Operative Agreements. 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 Loans and the Holder
Advances 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 which shall be payable to each Holder or other Person
entitled thereto) 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 which shall
be payable to each Holder or other Person entitled thereto) 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
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notices, certificates, financial statements, communications and other
information which are delivered, or are required to be delivered, to the
Lessor, to also be delivered at the same time to the Agent.
(c) No Credit Party shall consent to or permit any amendment, supplement
or other modification of the terms or provisions of any Operative Agreement
except in accordance with Section 12.4 of this Agreement.
(d) The Lessee hereby covenants and agrees to cause an Appraisal or
reappraisal (in form and substance satisfactory to the Agent and from an
appraiser selected by the Agent) to be issued respecting any Property as
reasonably 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, the Trust Company, any Lendor and/or any Holder and (ii)
after the occurrence of an Event of Default.
(e) The Lessee hereby covenants and agrees that, except for amounts
payable as Basic Rent, any and all payment obligations owing from time to time
under the Operative Agreements by any Person to the Agent, any Lender, any
Holder or any other Person shall (without further action) be deemed to be
Supplemental Rent obligations payable by the Lessee in accordance with the terms
and conditions of this Agreement and the other Operative Agreements. Without
limitation, such obligations of the Lessee shall include the Supplement Rent
obligations pursuant to Section 3.3 of the Lease, arrangement fees,
administrative fees, participation fees, commitment fees, unused fees,
prepayment penalties, breakage costs, indemnities, trustee fees and transaction
expenses incurred by the parties hereto in connection with the transactions
contemplated by the Operative Agreements.
(f) At any time the Lessor or the Agent is entitled under the Operative
Agreements to possession of a 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).
(g) The Lessee hereby covenants and agrees that, respecting each Property,
Non-Integral Equipment financed under the Operative Agreements may constitute up
to, but shall not exceed, ten percent (10%) of the aggregate Advances extended
at or prior to such time with respect to such Property.
(h) The Lessee hereby covenants and agrees that as of Completion (i) the
aggregate Property Cost shall not exceed $72,000,000 and (ii) each parcel of the
Property shall be a Permitted Facility.
(i) 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 any
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Property are kept, shall cease to be located at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or if it shall change its name.
(j) Unless the Agent otherwise agrees in writing, the Lessee hereby
covenants and agrees that the aggregate Property Cost of Non-Integral Equipment
purchased for any reason by the Lessee prior to the Expiration Date shall not
exceed ten percent (10%) of the aggregate Property Cost for all Properties
funded during the Commitment Period.
(k) The Lessee shall, on or before the first Business Day of each fiscal
quarter of the Lessee, furnish to the Agent a written notice setting forth the
Lessee's calculation, in reasonable detail, of the ratio of Funded Indebtedness
to EBITDA and the level of EBITDA for the immediately preceding fiscal quarter
of the Lessee.
(l) 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.
(m) Each Credit Party shall promptly notify the Agent, or cause the Agent
to be promptly notified, upon such Credit Party gaining knowledge of the
occurrence of any Default or Event of Default which is continuing at such time.
In any event, such notice shall be provided to the Agent within ten (10) days
of when such Credit Party gains such knowledge.
(n) Until all of the obligations under the Operative Agreements have been
finally and indefeasibly paid and satisfied in full and the Commitments and the
Holder Commitments terminated each Credit Party, unless consent has been
obtained from the Majority Secured Paries, will:
(i) except as permitted by Sections 8.3A and 8.3B, preserve and
maintain its separate legal existence and all rights, franchises, licenses
and privileges necessary to the conduct of its business, and qualify and
remain qualified as a foreign corporation (or partnership, limited
liability company or other such similar entity, as the case may be) and
authorized to do business in each jurisdiction in which the failure to do
so qualify would have a Material Adverse Effect;
(ii) pay and perform all obligations of the Credit Parties 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 if not paid would have
a Material Adverse Effect; provided that any Credit Party may contest any
item described in this Section 8.3(n)(ii) in good faith so long as adequate
reserves are maintained with respect thereto in accordance with GAAP;
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(iii) to the extent failure to do so would 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; keep in full force
and effect all licenses, certifications or accreditations necessary
for any Facility to carry on its business; and not permit the
termination of any insurance reimbursement program available to any
Facility; and
(iv) provided that the Agent, the Lenders and the Holders use reasonable
efforts to minimize disruption to the business of the Credit Parties,
permit representatives of the Agent or any Lender or Holder, from
time to time, to visit and inspect its properties; inspect, audit
and make extracts from its books, records and files, including
without limitation management letters prepared by independent
accountants; and discuss with its principal officers, and its
independent accountants, its business, assets, liabilities, financial
condition, results of operations and business prospects.
(o) [RESERVED].
(p) 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.
(q) Each Credit Party will promptly notify the Agent in the event such
Credit Party discovers or determines that any computer application (including
those of any supplier, vendor or customer of such Credit Party or any of its
Subsidiaries) that is material to such Credit Party's or any of its
Subsidiaries' business and operations will not be Year 2000 Compliant, except to
the extent that such failure shall not have and could not reasonably be expected
to have a Material Adverse Effect.
(r) Each Credit Party hereby covenants and agrees that, except for
amounts payable as Basic Rent, any and all payment obligations owing from time
to time under the Operative Agreements by any Person to the Agent, any Lender,
any Holder or any other Person shall (without further action) be deemed to be
Supplemental Rent obligations payable by the Lessee and guaranteed by the other
Credit Parties. Without limitation, such obligations of the Credit Parties shall
include without limitation arrangement fees, administrative fees, unused fees,
breakage costs, indemnities, trustee fees and transaction expenses incurred by
the parties hereto in connection with the transactions contemplated by the
Operative Agreements.
(s) Each Credit Party hereby covenants and agrees to cause each Domestic
Subsidiary of each Credit Party and the Parent formed or acquired after the
Initial Closing Date to execute a Joinder Agreement and to observe the terms of
Sections 5.10(a)-(d) of
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this Agreement, all within thirty (30) days of the formation or acquisition
of such Domestic Subsidiary or the Parent, as the case may be.
(t) The Lessee hereby covenants and agrees that it will (i) cause the
Improvements to be constructed by, and use commercially reasonable efforts
to cause the demolition of existing improvements to be performed by, a
Contractor that is a licensed general contractor, and that shall carry
insurance of the types and in the minimum amounts set forth in Section
14.2(c) of the Lease, under a maximum fixed price contact, and (ii) cause
such Contractor to retain licensed consultants, engineers, architects and
subcontractors, all of whom shall carry insurance of the types and in the
minimum amounts set forth in Section 14.2(c) of the Lease, in connection
with the construction of Improvements and the demolition of existing
improvements in accordance with the terms and conditions of the Operative
Agreements.
8.3A. AFFIRMATIVE COVENANTS.
(a) INFORMATION COVENANTS.
The Credit Parties will furnish, or cause to be furnished, to the Agent on
behalf of the Lenders:
(i) Annual Financial Statements. As soon as available, and in
any event within 90 days after the close of each fiscal year of the Lessee,
a consolidated and consolidating balance sheet and income statement of the
Credit Parties and their Consolidated Subsidiaries as of the end of such
fiscal year, together with related consolidated and consolidating
statements of operations and retained earnings and of cash flows for such
fiscal year, in each case setting forth in comparative form consolidated
and consolidating figures for the preceding fiscal year, all such financial
information described above to be in reasonable form and detail and audited
by independent certified public accountants of recognized national standing
reasonably acceptable to the Agent and whose opinion shall be to the effect
that such financial statements have been prepared in accordance with GAAP
(except for changes with which such accountants concur) and shall not be
limited as to the scope of the audit or qualified as to the status of the
Credit Parties and their Consolidated Subsidiaries as a going concern or
any other material qualifications or exceptions.
(ii) Quarterly Financial Statements. As soon as available, and
in any event within 45 days after the close of each fiscal quarter of the
Credit Party (other than the fourth fiscal quarter, in which case 90 days
after the end thereof) a consolidated and consolidating balance sheet and
income statement of the Credit Parties and their Consolidated Subsidiaries
as of the end of such fiscal quarter, together with related consolidated
and consolidating statements of operations and retained earnings and of
cash flows for such fiscal quarter, in each case setting forth in
comparative form consolidated and consolidating figures for the
corresponding period of the preceding fiscal year, all such financial
information described above to be in reasonable form and detail and
reasonably
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acceptable to the Agent, and accompanied by a certificate of the chief financial
officer of the Lessee to the effect that such quarterly financial statements
fairly present in all material respects the financial condition of the Credit
Parties and their Consolidated Subsidiaries and have been prepared in accordance
with GAAP, subject to changes resulting from audit and normal year-end audit
adjustments.
(iii) Officer's Certificate. At the time of delivery of the financial
statements provided for in Sections 8.3A(a)(i) and 8.3A(a)(ii) above, a
certificate of the chief financial officer of the Lessee or the Parent, as
applicable, substantially in the form of Schedule 8.3A(a)(iii), (i)
demonstrating compliance with the financial covenants contained in Section
8.3(k) by calculation thereof as of the end of each such fiscal period and (ii)
stating that no Default or Event of Default exists, or if any Default or Event
of Default does exist, specifying the nature and extent thereof and what action
the Credit Parties propose to take with respect thereto.
(iv) Annual Business Plan and Budgets. At least 30 days prior to the end of
each fiscal year of the Lessee, beginning with the fiscal year ending December
31, 1999, an annual budget of the Parent and its Consolidated Subsidiaries
containing, among other things, pro forma financial statements for the next
fiscal year.
(v) Accountant's Certificate. Within 120 days after the close of each
fiscal year of the Lessee, a certificate of the accountants conducting the
annual audit stating that they have reviewed this Credit Agreement and stating
further whether, in the course of their audit, they have become aware of any
Default or Event of Default and, if any such Default or Event of Default exists,
specifying the nature and extent thereof.
(vi) Auditor's Reports. Promptly upon receipt thereof, a copy of any other
report or "management letter" submitted by independent accountants to the Parent
or any of its Consolidated Subsidiaries in connection with any annual, interim
or special audit of the books of such Person.
(vii) Reports. Promptly upon transmission or receipt thereof, (i) copies of
any filings and registrations with, and reports to or from, the Securities and
Exchange Commission, or any successor agency, and copies of all financial
statements, proxy statements, notices and reports as the Parent or any
Consolidated Subsidiary shall send to its shareholders or to a holder of any
Indebtedness owed by the Parent or any Consolidated Subsidiary in its capacity
as such a holder and (ii) upon the request of the Agent, all reports and written
information to and from the United States Environmental Protection Agency, or
any state or local agency responsible for environmental matters, the United
States Occupational Health and Safety Administration, or any state or local
agency responsible for health and safety matters, or any successor agencies or
authorities concerning environmental, health or safety matters.
(viii) ERISA. Upon the Parent, any of its Consolidated Subsidiaries or any
ERISA Affiliate obtaining knowledge thereof, the Lessee will give written notice
to the
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Agent promptly (and in any event within five Business Days) of: (i) any event or
condition, including, but not limited to, any Reportable Event, that
constitutes, or might reasonably lead to, an ERISA Event; (ii) with respect to
any Multiemployer Plan, the receipt of notice as prescribed in ERISA or
otherwise of any withdrawal liability assessed against a Credit Party or any of
its Consolidated Subsidiaries or any ERISA Affiliates, or of a determination
that any Multiemployer Plan is in reorganization or insolvent (both within the
meaning of Title IV of ERISA); (iii) the failure to make full payment on or
before the due date (including extensions) thereof of all amounts which a Credit
Party or any of its Consolidated Subsidiaries or any ERISA Affiliate is required
to contribute to each Plan pursuant to its terms and as required to meet the
minimum funding standard set forth in ERISA and the Code with respect thereto;
or (iv) any change in the funding status of any Plan that could have a Material
Adverse Effect, together with a description of any such event or condition or a
copy of any such notice and a statement by the chief financial officer of the
Lessee briefly setting forth the details regarding such event, condition, or
notice, and the action, if any, which has been or is being taken or is proposed
to be taken by a Credit Party or any of its Consolidated Subsidiaries with
respect thereto. Promptly upon request, the Lessee shall furnish the Agent and
the Lenders with such additional information concerning any Plan as may be
reasonably requested, including, but not limited to, copies of each annual
report/return (Form 5500 series), as well as all schedules and attachments
thereto required to be filed with the Department of Labor and/or the Internal
Revenue Service pursuant to ERISA and the Code, respectively, for each "plan
year" (within the meaning of Section 3(39) of ERISA).
(ix) Environmental.
(A) Upon the reasonable written request of the Agent, the Lessee will
furnish or cause to be furnished to the Agent, at the Lessee's expense, a
report of an environmental assessment of reasonable scope, form and depth,
(including, where appropriate, invasive soil or groundwater sampling) by a
consultant reasonably acceptable to the Agent as to the nature and extent
of the presence of any Hazardous Materials on any Real Properties and as to
the compliance by a Credit Party or any of its Consolidated Subsidiaries
with Environmental Laws at such Real Properties. If the Lessee fails to
deliver such an environmental report within seventy-five (75) days after
receipt of such written request then the Agent may arrange for same, and
the Credit Parties hereby grant to the Agent and their representatives
access to the Real Properties to reasonably undertake such an assessment
(including, where appropriate, invasive soil or groundwater sampling). The
reasonable cost of any assessment arranged for by the Agent pursuant to
this provision will be payable by the Credit Parties on demand (except that
during the Construction Period, such cost shall be paid by Lessor;
provided, however, the Lessor shall pay such amounts described in this
Section 8.3A(a)(ix) only if funds are made available by the Lenders and the
Holders in an amount sufficient to allow such payment) and added to the
obligations secured by the Security Documents.
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(B) The Lessee and its Consolidated Subsidiaries will conduct and
complete (or, in the case of Pre-Existing Environmental Conditions, cause
to be conducted and completed) all investigations, studies, sampling, and
testing and all remedial, removal, and other actions necessary to address
all Hazardous Materials on, from or affecting any of the Real Properties to
the extent necessary to be in compliance with all Environmental Laws and
with the validly issued orders and directives of all Governmental
Authorities with jurisdiction over such Real Properties to the extent any
failure could have a Material Adverse Effect.
(X) Other Information. With reasonable promptness upon any such
request, such other information regarding the business, properties or financial
condition of a Credit Party and any of its Consolidated Subsidiaries as the
Agent or the Majority Secured Parties may reasonably request.
(b) PRESERVATION OF EXISTENCE AND FRANCHISES.
Each of the Credit Parties will, and will cause each of its Consolidated
Subsidiaries to, do all things necessary to preserve and keep in full force and
effect its existence, rights, franchises and authority, except in connection
with any Permitted Acquisition.
(c) BOOKS AND RECORDS.
Each of the Credit Parties will, and will cause each of its Consolidated
Subsidiaries to, keep complete and accurate books and records of its
transactions in accordance with good accounting practices on the basis of GAAP
(including the establishment and maintenance of appropriate reserves).
(d) COMPLIANCE WITH LAW.
Each of the Credit Parties will, and will cause each of its Consolidated
Subsidiaries to, comply with all laws, rules, regulations and orders, and all
applicable restrictions imposed by all Governmental Authorities, applicable to
it and its Property if noncompliance with any such law, rule, regulation, order
or restriction could have a Material Adverse Effect; provided, however, that
solely with respect to the Pre-Existing Environmental Conditions, compliance
with the CD, and with any and all other applicable orders and directives of
federal, state and local Governmental Authorities, shall constitute compliance
with Legal Requirements.
(e) PAYMENT OF TAXES AND OTHER INDEBTEDNESS.
Subject to Lessee's permitted contest rights under Section 11.2 hereof and
Section 13.1 of the Lease, each of the Credit Parties will, and will cause each
of its Consolidated Subsidiaries to, pay and discharge (a) all taxes,
assessments and governmental charges or levies imposed upon it, or upon its
income or profits, or upon any of its properties, before they shall become
delinquent, (b) all lawful claims (including claims for labor, materials
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44
and supplies) which, if unpaid, might give rise to a Lien upon any of its
properties, and (c) except as prohibited hereunder, all of its other
Indebtedness as it shall become due; provided, however, that a Credit Party and
any of its Consolidated Subsidiaries shall not be required to pay any such tax,
assessment, charge, levy, claim or Indebtedness which is being contested in
good faith by appropriate proceedings and as to which adequate reserves
therefor have been established in accordance with GAAP, unless the failure to
make any such payment (i) could give rise to an immediate right to foreclose on
a Lien securing such amounts or (ii) could have a Material Adverse Effect.
(f) MAINTENANCE OF PROPERTY.
Each of the Credit Parties will, and will cause each of its
Consolidated Subsidiaries to, maintain and preserve its properties and
equipment material to the conduct of its business in good repair, working order
and condition, normal wear and tear and casualty and condemnation excepted, and
will make, or cause to be made, in such properties and equipment from time to
time all repairs, renewals, replacements, extensions, additions, betterments
and improvements thereto as may be needed or proper, to the extent and in the
manner customary for companies in similar businesses.
(g) PERFORMANCE OF OBLIGATIONS.
Each of the Credit Parties will, and will cause each of its
Consolidated Subsidiaries to, perform in all material respects all of its
obligations under the terms of all material agreements, indentures, mortgages,
security agreements or other debt instruments to which it is a party or by
which it is bound.
(h) FINANCIAL COVENANTS.
(i) Leverage Ratio. The Leverage Ratio, as of the last day of
each fiscal quarter of the Lessee, shall be less than or equal to:
(A) From the Closing Date to and including December 31,
2000, 1.25 to 1.0; and
(B) From January 1, 2001 and thereafter, 1.0 to 1.0.
(ii) EBITDA. EBITDA, for each period set forth below, as shown on
the financial statements of Credit Parties and their Consolidated Subsidiaries
delivered pursuant to Section 8.3(A)(a)(i), shall not be less than (i)
$130,000,000 for each twelve month period ending December 31, 1999, March 31,
2000, June 30, 2000 and September 30, 2000, (ii) $200,000,000 for each twelve
month period ending December 31, 2000, March 31, 2001, June 30, 2001 and
September 30, 2001 (iii) $230,000,000 for each twelve month period ending
December 31, 2001, March 31, 2002, June 30, 2002 and September 30, 2002, (iv)
$340,000,000 for each twelve month period ending December 31, 2002, March 31,
2003, June 30, 2003 and September 30, 2003 and (v) $450,000,000
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for each twelve month period ending as of December 31, 2003 and each March 31,
June 30, September 30 and December 31 thereafter.
(iii) Quick Ratio. The Quick Ratio, as of the last day of each fiscal
quarter of the Lessee, shall be greater than or equal to 1.50 to 1.0.
(iv) Calculation Method. For purposes of calculating the Leverage
Ratio and the Quick Ratio, unsecured convertible subordinated debentures of a
Credit Party permitted by Section 8.3B(a)(vi) shall not be considered Funded
Debt.
(i) NSMG ACQUISITION.
The Credit Parties hereby agree that they will cause the following events
to occur (in the order designated below) prior to September 30, 1999:
(i) the merger of Merger Sub with and into the Lessee shall occur
(making the Lessee a wholly-owned Subsidiary of the Parent) in accordance with
the terms of the Reorganization Agreement and applicable law;
(ii) each share of Capital Stock of the Lessee will be converted into
one share of Capital Stock of the Parent in accordance with the terms of the
Reorganization Agreement and applicable law; and
(iii) the Parent shall have acquired all of the Capital Stock of NSMG
and the NSMG Business in accordance with the terms of the Reorganization
Agreement and applicable law.
8.3B. NEGATIVE COVENANTS.
(a) INDEBTEDNESS.
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, contract, create, assume or permit to exist any Indebtedness,
except:
(i) Indebtedness arising under this Participation Agreement and the
other Operative Agreements;
(ii) Indebtedness of a Credit Party and its Consolidated Subsidiaries
set forth in Schedule 8.3B(a)(ii) (and renewals, refinancings and extensions
thereof on terms and conditions no less favorable to such Person than such
existing Indebtedness);
(iii) purchase money Indebtedness (including obligations in respect of
Capital Leases) hereafter incurred by a Credit Party or any of its Consolidated
Subsidiaries to finance the purchase of fixed assets provided that (i) the
total of all such Indebtedness for all such Persons taken together (including
any such Indebtedness referred to in subsection
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(b) above) shall not exceed (A) during fiscal year 1999 and 2000, an aggregate
principal amount of $25,000,000 at any one time outstanding and (B) at any time
subsequent to fiscal year 2000, $40,000,000 at any one time outstanding; (ii)
such Indebtedness when incurred shall not exceed the purchase price of the
asset(s) financed; and (iii) no such Indebtedness shall be refinanced for a
principal amount in excess of the principal balance outstanding thereon at the
time of such refinancing;
(iv) other unsecured Indebtedness of the Credit Parties and their
Consolidated Subsidiaries in an aggregate amount not to exceed $150,000,000 on
terms and conditions satisfactory in form and substance to the Majority Secured
Parties;
(v) the Subordinated Debt; and
(vi) Indebtedness of a Credit Party consisting of unsecured
convertible subordinated debentures on terms and conditions (including, without
limitation, the subordination terms) reasonably acceptable to the Agent, and
any renewal, refinancings or extensions thereof on terms and conditions
(including, without limitation, the subordinations terms) reasonably acceptable
to the Agent.
(b) LIENS.
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to contract, create, incur, assume or permit to exist any Lien
with respect to any of its Property, whether now owned or after acquired,
except for Permitted Liens.
(c) NATURE OF BUSINESS.
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, substantively alter the character or conduct of its business
from that conducted as of the Initial Closing Date or engage in any business
other than the business conducted as of the Initial Closing Date other than
activities in the systems management software business substantially similar or
related to such businesses.
(d) CONSOLIDATION, MERGER, DISSOLUTION, ETC.
No Credit Party will, nor will it permit any Consolidated Subsidiaries to,
enter into any transaction of merger or consolidation or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution); provided that,
notwithstanding the foregoing provisions of this Section 8.3B(d), (a) the
Lessee may merge or consolidate with any of its Consolidated Subsidiaries
provided that (i) the Lessee shall be the continuing or surviving corporation,
and (ii) after giving effect to such transaction, no Default or Event of
Default arises, (b) any Consolidated Subsidiary of the Lessee may be merged or
consolidated with or into any other Consolidated Subsidiary of the Lessee
provided that after giving effect to such transaction no Default or Event of
Default exists, (c) any Wholly-Owned Subsidiary of the Lessee may dissolve,
liquidate or wind up its affairs at any time provided that such
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dissolution, liquidation or winding up, as applicable, could not have a
Material Adverse Effect and (d) the Lessee may merge with Merger Sub (as
defined in the Reorganization Agreement) pursuant to the terms of the
Reorganization Agreement provided that after giving effect to such merger no
Default or Event of Default exists.
(e) ASSET DISPOSITIONS.
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, sell, lease, transfer or otherwise dispose of any Property
(including, without limitation, pursuant to any sale/leaseback transaction or
securitization transaction) other than (i) the sale of assets in the ordinary
course of business for fair consideration, (ii) the sale or disposition of
assets no longer used or useful in the conduct of such Person's business and
(iii) the sale by NSMG for fair consideration of those lines of business
identified on Schedule 8.3B(e).
(f) INVESTMENTS.
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, make Investments in or to any Persons, except for Permitted
Investments.
(g) RESTRICTED PAYMENTS.
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, directly or indirectly, declare, order, make or set apart any
sum for or pay any Restricted Payment, except (i) to make dividends payable
solely in the same class of Capital Stock of such Person so long as no Default
or Event of Default exists and is continuing or would be directly or indirectly
caused as a result thereof, (ii) to make dividends or other distributions
payable to the Lessee (directly or indirectly through Subsidiaries), (iii)
prior to the Reorganization, the repurchase by the Lessee of outstanding shares
of Capital Stock of the Lessee so long as no Default or Event of Default exists
and is continuing or would be directly or indirectly caused as a result thereof
and (iv) after the Reorganization, the repurchase by the Parent of outstanding
shares of Capital Stock of the Parent so long as no Default or Event of Default
exists and is continuing or would be directly or indirectly caused as a result
thereof.
(h) OTHER INDEBTEDNESS.
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, (i) after the issuance thereof, amend or modify (or permit the
amendment or modification of) any of the terms of any Indebtedness of a Credit
Party or any of its Consolidated Subsidiaries if such amendment or modification
would add or change any terms in a manner adverse to such Credit Party or any
of its Consolidated Subsidiaries, or shorten the final maturity or average life
to maturity or require any payment to be made sooner than originally scheduled
or increase the interest rate applicable thereto or change any subordination
provision thereof or (ii) make (or give any notice with respect thereto) any
voluntary or optional payment or prepayment or redemption or acquisition for
value of
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(including without limitation, by way of depositing money or securities
with the trustee with respect thereto before due for the purpose of paying
when due), refund, refinance or exchange of any other Indebtedness of a
Credit Party or any of its Consolidated Subsidiaries.
(i) TRANSACTIONS WITH AFFILIATES.
----------------------------
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, enter into or permit to exist any transaction or series of
transactions with any officer, director, shareholder, Subsidiary or
Affiliate of such Person other than (a) transactions permitted by Section
8.3B(d), Section 8.3B(f) or Section 8.3B(g), (b) normal compensation and
reimbursement of expenses of officers and directors, (c) any employment
agreement (including customary benefits thereunder) that is entered into in
the ordinary course of business and (d) other transactions which are
entered into in the ordinary course of such Person's business on terms and
conditions substantially as favorable to such Person as would be obtainable
by it in a comparable arms-length transaction with a Person other than an
officer, director, shareholder, Subsidiary or Affiliate.
(j) FISCAL YEAR; ORGANIZATIONAL DOCUMENTS.
-------------------------------------
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, (a) change its fiscal year without having first provided
30 days prior written notice to the Agent, or (b) amend, modify or change
its articles of incorporation (or corporate charter or other similar
organizational document) or bylaws (or other similar document) in any
manner that would reasonably be likely to adversely affect the rights of
the Lenders and Holders without the prior written consent of the Majority
Secured Parties.
(k) LIMITATION ON RESTRICTED ACTIONS.
--------------------------------
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, directly or indirectly, create or otherwise cause or
suffer to exist or become effective any encumbrance or restriction on the
ability of any such Person to (a) pay dividends or make any other
distributions on such Person's Capital Stock or with respect to any other
interest or participation in, or measured by, its profits, (b) pay any
Indebtedness or other obligation owed to a Credit Party or any of its
Consolidated Subsidiaries, (c) make loans or advances to Credit Party or
any of its Consolidated Subsidiaries, (d) sell, lease or transfer any of
its properties or assets to a Credit Party or any of its Consolidated
Subsidiaries, except (in respect of any of the matters referred to in
clauses (a)-(d) above) for such encumbrances or restrictions existing under
or by reason of (i) this Participation Agreement and the other Operative
Agreements or (ii) applicable law.
(l) OWNERSHIP OF SUBSIDIARIES.
-------------------------
Notwithstanding any other provisions of this Credit Agreement to the
contrary, the Credit Parties will not, nor will they permit any of their
Consolidated Subsidiaries to, (i)
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permit any Person (other than the Parent, the Lessee or any Wholly-Owned
Subsidiary of the Lessee) to own any Capital Stock of any Subsidiary of a
Credit Party, (ii) permit any Subsidiary of a Credit Party to issue any
shares of preferred Capital Stock or (iii) permit, create, incur, assume or
suffer to exist any Lien on any Capital Stock of any Subsidiary of a Credit
Party.
(m) SALE LEASEBACKS.
---------------
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, directly or indirectly, become or remain liable as lessee
or as guarantor or other surety with respect to any lease, whether an
Operating Lease or a Capitalized Lease, of any Property (whether real,
personal or mixed), whether now owned or hereafter acquired, (a) which such
Credit Party or any of its Consolidated Subsidiaries has sold or
transferred or is to sell or transfer to a Person which is not a Credit
Party or any of its Consolidated Subsidiaries or (b) which a Credit Party
or any of its Consolidated Subsidiaries intends to use for substantially
the same purpose as any other Property which has been sold or is to be sold
or transferred by such Credit party or its Consolidated Subsidiaries to
another Person which is not a Credit Party or any of its Consolidated
Subsidiaries in connection with such lease.
(n) NO FURTHER NEGATIVE PLEDGES.
---------------------------
No Credit Party will, nor will it permit any of its Consolidated
Subsidiaries to, enter into, assume or become subject to any agreement
prohibiting or otherwise restricting the creation or assumption of any Lien
upon its properties or assets, whether now owned or hereafter acquired, or
requiring the grant of any security for any obligation if security is given
for any other obligation, except pursuant to this Participation Agreement
and the other Operative Agreements.
(o) CAPITAL EXPENDITURES.
--------------------
The Credit Parties hereby agree that the Credit Parties and their
Consolidated Subsidiaries will not make any Capital Expenditures if any
Default or Event or Default has occurred and is continuing or would be
directly or indirectly caused as a result thereof.
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 8.7
hereof. The Lessor, the Holders, the Agent, the Lenders 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.
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8.5 GRANT OF EASEMENTS, ETC.
The Owner Trustee, the Agent, the Lenders and the Holders hereby
agree that, so long as no Event of Default shall have occurred and be
continuing, the Lessee may take the following actions in the name and stead of
the Owner Trustee (but at Lessee's sole cost and expense) in connection with
the transactions contemplated by the Agency Agreement, the Lease or the other
Operative Agreements, (i) grant easements and other rights in the nature of
easements with respect to any Property, (ii) release existing easements or
other rights in the nature of easements which are for the benefit of any
Property, (iii) execute and deliver to any Person any instrument appropriate to
confirm or effect such grants or releases, and (iv) execute and deliver to any
Person such other documents or materials in connection with the acquisition,
development, construction, testing or operation of any 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 of the type normally executed by the Lessee in the ordinary course
of the Lessee's business and shall be on commercially reasonable terms so as
not to diminish the fair market value of any Property; provided, further, that
nothing in this Section 8.5 shall be deemed to permit the Lessee to modify,
amend, alter, release, terminate or otherwise affect that certain Grant of
Easements, Restriction and Indemnity Agreement dated as of December 24, 1997
and executed by Raytheon Semiconductor, Inc., as grantor, in favor of Raytheon,
together with its successors in title, as grantee, without the consent of the
Agent. The Owner Trustee shall, upon Lessee's reasonable request, promptly
execute and deliver any instrument necessary or appropriate to confirm such
grant, release, dedication or transfer to any Person permitted under this
Section 8.5.
8.6. APPOINTMENT BY THE AGENT, THE LENDERS, THE HOLDERS AND THE
OWNER TRUSTEE.
The Holders hereby appoint the Agent to act as collateral agent for the
Holders in connection with the Lien granted by the Security Documents to secure
the Holder Amount. The Lenders and the Holders 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 Lenders and the
Holders as directed from time to time by the Majority Secured Parties or,
pursuant to Sections 8.2(h) and 12.4, all of the Lenders and the Holders, as
the case may be; 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
Owner Trustee (as determined by the Agent, in its reasonable discretion), to
receive notices under the Operative Agreements on behalf of the Owner Trustee
and (subject to Sections 8.5 and 9.2) to take such other action under the
Operative Agreements on behalf of the Owner Trustee as the Agent shall
determine in its reasonable discretion from time to time. The Agent hereby
accepts such appointments. For purposes hereof, the provisions of Section 7 of
the Credit Agreement, together with such other terms and provisions of the
Credit Agreement and the other Operative Agreements as required for the full
interpretation and operation of Section 7 of the Credit Agreement are hereby
incorporated by reference as if restated for the mutual benefit of the Agent
and each Holder as if each
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Holder were a Lender thereunder. Outstanding Holder Advances and outstanding
Loans shall each be taken into account for purposes of determining Majority
Secured Parties. Further, the Agent shall be entitled to take such action on
behalf of the Owner Trustee as is delegated to the Agent under any Operative
Agreement (whether express or implied) as may be reasonably incidental thereto.
The parties hereto hereby agree to the provisions contained in this Section
8.6. Any appointment of a successor agent under Section 7.9 of the Credit
Agreement shall also be effective as an appointment of a successor agent for
purposes of this Section 8.6.
8.7. COLLECTION AND ALLOCATION OF PAYMENTS AND OTHER AMOUNTS.
(a) Each Credit Party has agreed pursuant to Section 5.8 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 any of the Operative Agreements due and
owing or payable to any Person 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 Holders or any
of the Lenders in connection with the Collateral, the Security Documents or
any of the other Operative Agreements. Ratable distributions among the
Lenders and the Holders under this Section 8.7 shall be made based on (in
the case of the Lenders) the ratio of the outstanding Loans to the
aggregate Property Cost and (in the case of the Holders) the ratio of the
outstanding Holder Advances to the aggregate Property Cost. Ratable
distributions among the Tranche A Lenders under this Section 8.7 shall be
made based on the ratio of the individual Tranche A Lender's Commitment for
Tranche A Loans to the aggregate of all the Tranche A Lenders' Commitments
for Tranche A Loans. 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. Ratable
distributions among the Lenders (in situations where the Tranche A Lenders
are not differentiated from the Tranche B Lenders) shall be made based on
the ratio of the individual Lender's Commitment to the aggregate of all the
Lenders' Commitments. Ratable distributions among the Holders under this
Section 8.7 shall be based on the ratio of the individual Holder's Holder
Commitment to the aggregate of all the Holders' Holder Commitments.
(b) Payments and other amounts received by the Agent 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 first, ratably
to the Lenders and the Holders for application and allocation to the
payment of interest on the Loans and thereafter the principal of the
Loans which is due and payable on such date and to the payment of
accrued Holder Yield with respect to the Holder Advances
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and thereafter the portion of the Holder Advances which is due on such
date; and second, if no Default or Event of Default has occurred and
is continuing, any excess shall be paid to such Person or Persons as
the Lessee may designate; provided, that if a Default or Event of
Default has occurred and is continuing, such excess (if any) shall
instead be held by the Agent until the earlier of (I) the first date
thereafter on which no Default or Event of Default shall be continuing
(in which case such payments or returns shall then be made to such
other Person or Persons as the Lessee may designate) and (II) the
Maturity Date or the Expiration Date, as the case may be (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 (A) any Casualty or Condemnation 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), or (B) the Termination Value in connection with the delivery
of a Termination Notice pursuant to Article XVI of the Lease, or (C)
the Termination Value in connection with the exercise of the Purchase
Option under Section 20.1 of the Lease or the exercise of the option
of the Lessor to transfer the Properties to the Lessee pursuant to
Section 20.3 of the Lease, or (D) any payment required to be made or
elected to be made by the Construction Agent to the Lessor pursuant to
the terms of the Agency Agreement, then in each case, the Lessor shall
be required to pay such amount received (1) if no Acceleration has
occurred, to prepay the principal balance of the Loans and the Holder
Advances, on a pro rata basis, a portion of such amount to be
distributed to the Lenders and the Holders or (2) if an Acceleration
has occurred, to apply and allocate the proceeds respecting Sections
8.7(b)(ii)(A) through 8.7(b)(ii)(D) in accordance with Section
8.7(b)(iii) hereof.
(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 Properties or any portion thereof, whether pursuant to Article
XXII of the Lease or the exercise of remedies under the Security
Documents or otherwise, the execution of remedies set forth in the
Lease and 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, ratably to the payment to the Holders of the outstanding
principal balance of all Holder Advances plus all outstanding Holder
Yield with respect to such outstanding Holder Advances, 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 and interest of the Tranche A Loans then
outstanding, fourth, to any and all other amounts owing under the
Operative Agreements to the Lenders under the Tranche B Loans, fifth,
to any and all other amounts owing under the
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Operative Agreements to the Holders, sixth, to any and all other amounts owing
under the Operative Agreements to the Lenders under the Tranche A Loans, and
seventh, to the extent moneys remain after application and allocation pursuant
to clauses first through sixth above, to the Owner Trustee for application and
allocation to any and all other amounts owing to the Holders or the Owner
Trustee and as the Holders shall determine; provided, where no Event of
Default shall exist and be continuing and a prepayment is made for any reason
with respect to less than the full amount of the outstanding principal amount of
the Loans and the outstanding Holder Advances, the proceeds shall be applied
and allocated ratably to the Lenders and to the Holders.
(iv) An amount equal to (A) any such payment identified as a payment
of the Maximum Amount or any payment pursuant to Section 22.1(b) of the Lease
(or otherwise) of the Maximum Residual Guarantee Amount (and any such lesser
amount as may be required by Section 22.1(b) of the Lease) in respect of the
Properties and (B) any other amount payable upon any exercise of remedies 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 Acceleration which does not represent proceeds from the sale
or liquidation of the Properties) and (C) any other amount payable to any
Guarantor pursuant to Section 6B, shall be applied and allocated by the Agent
first, ratably, to the payment of the principal and interest balance of Tranche
A Loans then outstanding, second, ratably to the payment of the principal and
interest balance of the Tranche B Loans then outstanding, third, ratably to the
payment of the principal balance of all Holder Advances plus all outstanding
Holder Yield with respect to such outstanding Holder Advances, fourth, to the
payment of any other amounts owing to the Lenders hereunder or under any of the
other Operative Agreement, and fifth, to the extent moneys remain after
application and allocation pursuant to clauses first through fourth above, to
the Owner Trustee for application and allocation to Holder Advances and Holder
Yield and any other amounts owing to the Holders or the Owner Trustee as the
Holders shall determine.
(v) An amount equal to any such payment identified as Supplemental Rent
shall be applied and allocated by the Agent to the payment of any amounts then
owing to the Agent, the Lenders, the Holders 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 Rent received upon the exercise of remedies after the occurrence
and continuance of an Event of Default in lieu of or in substitution of the
Maximum Residual Guarantee Amount or as a partial payment thereon shall be
applied and allocated as set forth in Section 8.7(b)(iv).
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(vi) 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) Upon the payment in full of the Loans, the Holder Advances and
all other amounts then due and owing by the Owner Trustee hereunder or
under any Credit Document and the payment in full of all other amounts then
due and owing to the Lenders, the Holders, the Agent, the Owner Trustee and
the other Financing Parties pursuant to the Operative Agreements, any
moneys remaining with the Agent shall be returned to the Lessee. In the
event of an Acceleration it is agreed that, prior to the application and
allocation of amounts received by the Agent in the order described in
Section 8.7(b) above or any distribution of money to the Lessee, any such
amounts shall first be applied and allocated to the payment of (i) any and
all sums advanced by the Agent in order to preserve the Collateral or to
preserve its Lien thereon, (ii) the expenses of retaking, holding,
preparing for sale or lease, selling or otherwise disposing or realizing on
the Collateral, or of any exercise by the Agent of its rights under the
Security Documents, together with reasonable attorneys' fees and expenses
and court costs and (iii) any and all other amounts reasonably owed to the
Agent under or in connection with the transactions contemplated by the
Operative Agreements (including without limitation any accrued and unpaid
administration fees).
8.8. RELEASE OF PROPERTIES, ETC.
If the Lessee shall at any time purchase any Property pursuant to the
Lease, or the Construction Agent shall purchase any Property pursuant to the
Agency Agreement, or if any Property shall be sold in accordance with Article
XXII of the Lease, then, upon satisfaction by the Owner Trustee of its
obligation to prepay the Loans, Holder Advances and all other amounts owing to
the Lenders and the Holders under the Operative Agreements, the Agent is hereby
authorized and directed to release such Properties 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 Holder Commitments and the payment
in full of the Loans, the Holder Advances and all other amounts owing by the
Owner Trustee and the Lessee hereunder or under any other Operative Agreement
the Agent is hereby authorized and directed to release all of the Properties
from the Liens created by the Security Documents to the extent of its interest
therein. Upon request of the Owner Trustee following any such release, the
Agent shall, at the sole cost and expense of the Lessee, execute and deliver to
the Owner Trustee and the Lessee such documents as the Owner Trustee or the
Lessee shall reasonably request to evidence such release.
SECTION 9. CREDIT AGREEMENT AND TRUST AGREEMENT.
9.1. THE CONSTRUCTION AGENT'S AND THE LESSEE'S CREDIT AGREEMENT RIGHTS.
Notwithstanding anything to the contrary contained in the Credit
Agreement, the Agent, the Lenders, the Holders, the Credit Parties and the Owner
Trustee hereby agree that, prior to the
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occurrence and continuation of any Default or 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 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;
(e) the right to replace any Lender pursuant to Section 2.11(b) of
the Credit Agreement;
(f) the right to approve any successor agent pursuant to Section 7.9
of the Credit Agreement;
(g) the right to consent to any assignment by a Lender to which the
Lessor has the right to consent pursuant to Section 9.8 of the Credit
Agreement; and
(h) the right to notice of and the opportunity to cure any Credit
Agreement Event of Default within the applicable period set forth in
Section 6 of the Credit Agreement (except that the Lessee shall not have
any additional right to cure any Credit Agreement Event of Default that is
also a Lease Event of Default beyond such cure rights as are expressly set
forth in Section 17 of the Lease).
9.2. THE CONSTRUCTION AGENT'S AND THE LESSEE'S TRUST AGREEMENT RIGHTS.
Notwithstanding anything to the contrary contained in the Trust Agreement,
the Credit Parties, the Owner Trustee and the Holders hereby agree that, prior
to the occurrence and continuation of any Default or Event of Default, the
Construction Agent or the Lessee, as the case may be, shall have the following
rights:
(a) the right to exercise the conversion and continuation options
pursuant to Section 3.8 of the Trust Agreement;
(b) the right to receive any notice and any certificate, in each case
issued pursuant to Section 3.9(a) of the Trust Agreement;
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(c) the right to replace any Holder pursuant to Section 3.9(b) of the
Trust Agreement;
(d) the right to exercise the removal options contained in Section
9.1 of the Trust Agreement; provided, however, that no removal of the
Owner Trustee and appointment of a successor Owner Trustee by the Holders
pursuant to Section 9.1 of the Trust Agreement shall be made without the
prior written consent (not to be unreasonably withheld or delayed) of the
Lessee.
SECTION 10. TRANSFER OF INTEREST.
10.1 RESTRICTIONS ON TRANSFER.
Each 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, each participant,
assignee or transferee must obtain the same ratable interest in Tranche A Loans,
Tranche A Commitments, Tranche B Loans and Tranche B Commitments (and to the
extent the selling Lender is also a Holder (or an Affiliate of a Holder), each
such participant, assignor or transferee must also obtain the same ratable
interest in and to the Holder Advances, Holder Commitments and the Trust
Estate); provided further, that each 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 a copy of each Assignment and
Acceptance (as referenced in Section 9.8 of the Credit Agreement) for purposes
of maintaining the Register. The Holders may, directly or indirectly, assign,
convey or otherwise transfer any of their right, title or interest in or to the
Trust Estate or the Trust Agreement with the prior written consent of the Agent
and the Lessee (which consent shall not be unreasonably withheld or delayed) and
in accordance with the terms of Section 11.8(b) of the Trust Agreement;
provided, to the extent the selling Holder is also a Lender (or an Affiliate of
a Lender), each such assignee, receiver of a conveyance or other transferee must
also obtain the same ratable interest in and to the Tranche A Loans, Tranche A
Commitments, Tranche B Loans and Tranche B Commitments. The Owner Trustee 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 (which consent may be withheld by the
Agent in its sole discretion) and (provided, no Default or Event of Default has
occurred and is continuing) with the consent of the Lessee, 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 any Property,
the Lease, the Trust Agreement and the other Operative Agreements (including
without limitation any right to indemnification thereunder), or any other
document relating to a Property or any interest in a Property as provided in the
Trust Agreement and the Lease. The provisions of the immediately preceding
sentence shall not apply to the obligations of the Owner Trustee to transfer
Property to the Lessee or a third party purchaser pursuant to Article XXII of
the Lease upon payment for such Property in accordance with the terms and
conditions of the Lease. No Credit Party may assign any of the Operative
Agreements or any of their respective rights or
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obligations thereunder or with respect to any Property in whole or in part to
any Person without the prior written consent of the Agent, the Lenders, the
Holders and the Lessor.
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 Owner
Trustee, a Holder or a Lender as above provided, any such transferee shall
assume the obligations of the Owner Trustee, the Holder or the Lender, as the
case may be, and shall be deemed an "Owner Trustee", "Holder", or "Lender", as
the case may be, for all purposes of such documents and each reference herein to
the transferor shall thereafter be deemed a reference to such transferee for all
purposes, except as provided in the preceding sentence. Notwithstanding any
transfer of all or a portion of the transferor's interest as provided in this
Section 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.
Subject to and limited by in all respects by the provisions of Sections
11.6 through 11.8 and whether or not any of the transactions contemplated hereby
shall be consummated, the Indemnity Provider hereby assumes liability for and
agrees to defend, indemnify and hold harmless each Indemnified Person on an
After Tax Basis from and against any Claims, which may be imposed on, incurred
by or asserted against an Indemnified Person by any 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 itself, as determined by a court of
competent jurisdiction, as opposed to gross negligence or willful misconduct
imputed to such Indemnified Person) 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
any 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, acceptance, nondelivery, leasing,
subleasing, possession, use, occupancy, operation, maintenance repair,
modification, transportation, condition, sale, return, repossession (whether by
summary proceedings or otherwise), or any other disposition of any 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 any Property or any
portion thereof whether or not discoverable by an Indemnified Person or the
Indemnity
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Provider; (c) a violation of Environmental Laws. Environmental Claims 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; (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; and (h) any fees, expenses and/or other
assessments by any business park or any other applicable entity with oversight
responsibility for the applicable Property.
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; 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
precludes in all respects the Indemnity Provider from contesting such Claim.
If, within thirty (30) days of receipt of such notice from the Indemnified
Person (or such shorter period as the Indemnified Person has notified the
Indemnity Provider is required by law or regulation for the Indemnified Person
to respond to such Claim), the Indemnity Provider shall request in writing that
such Indemnified Person respond to such Claim, the Indemnified Person shall, at
the expense of the Indemnity Provider, in good faith conduct and control such
action (including without limitation by pursuit of appeals) (provided, however,
that (A) if such Claim, 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
the Indemnity Provider to conduct and control the response to such Claim (with
counsel to be selected by the Indemnity Provider and consented to by such
Indemnified Person, such consent not to be unreasonably withheld; provided,
however, that any Indemnified Person may retain separate counsel at the expense
of the Indemnity Provider in the event of a 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
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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.
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, if
the Indemnified Person has informed the Indemnity Provider that it intends to
contest such Claim (whether or not the control of the contest is then assumed
by the Indemnity Provider), 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
$25,000 (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 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 the position asserted in such appeal will more
likely than not prevail) and (F) no Event of Default shall have occurred and be
continuing. In no event shall an Indemnified Person be required to appeal an
adverse judicial
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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) Subject to and limited by in all respects the provisions of
Sections 11.6 through 11.8 and Section 3.9(a) of the Trust Agreement, the
Indemnity Provider shall pay and assume liability for, and does hereby agree to
indemnify, protect and defend each Property and all Indemnified Persons, and
hold them harmless against, all Impositions on an After Tax Basis, 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) (collectively, the "Excluded Taxes"):
(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, the
Owner Trustee and the Trust) 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
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, the
Owner Trustee and the Trust) 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; provided, however, that the Indemnity Provider shall not
have any obligation to indemnify any Indemnified Person for any
California unitary tax obligations of the Indemnified Person that
are not attributable to the payments received under the Operative
Agreements or otherwise attributable to the
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transactions contemplated thereby; provided, further, that such Taxes shall not
be excluded under this subparagraph (ii) to the extent such Taxes would have
been imposed had the location, possession or use of any 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;
(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.
(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).
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(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 each
Property and any other tax returns required for the Owner Trustee respecting the
transactions described in the Operative Agreements. 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). Such Indemnified Person shall, upon the Indemnity Provider's
request and at the Indemnity Provider's expense, provide any data maintained by
such Indemnified Person (and not otherwise available to or within the control of
the Indemnity Provider) with respect to 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, Holder Yield payable on the Certificates 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
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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 1001 (relating to such Financing
Party and entitling it to a complete exemption from Withholding on such
Exempt Payment) or Form 4224 or is otherwise subject to exemption from
Withholding with respect to such Exempt Payment (except where the failure
of the exemption results from a change in the principal place of business
of the Lessee; provided if a failure of exemption for any Financing Party
results from a change in the principal place of business or lending office
of any other Financing Party, then such other Financing Party shall be
liable for any Withholding or indemnity with respect thereto), 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.
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
Untied 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 1001" shall mean Form 1001 (Ownership,
Exemption, or Reduced Rate Certificate) of the Department of the Treasury of the
United States of America and (D) "Form 4224" shall mean Form 4224(R) (Exemption
from Withholding of Tax on Income Effectively Connected with the Conduct of a
Trade or Business in the United States) of the Department of 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
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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 Indemnity Provider any information regarding
its tax affairs or tax computations.
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.
(f) 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 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 and 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 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 subject to the terms of Section 2.11 of the Credit Agreement
and 3.9 of the Trust Agreement, as the case may be), pay to the Agent for the
account of such Financing Party additional amounts sufficient to compensate
such Financing Party for such increased cost. 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
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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 and
other commitments of this type or upon the Advances, then, upon demand by such
Financing Party (with a copy of such demand to the Agent but subject to the
terms of Section 2.11 of the Credit Agreement and 3.9 of the Trust 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 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) Without limiting the effect of the foregoing, the Lessee shall pay to
each Financing Party on the last day of the Interest Period therefor so long as
such Financing Party is maintaining reserves against "Eurocurrency liabilities"
under Regulation D an additional amount (determined by such Financing Party and
notified to the Lessee through the Agent) equal to the product of the following
for each Eurodollar Loan or Eurodollar Holder Advance, as the case may be, for
each day during such Interest Period:
(i) the principal amount of such Eurodollar Loan or Eurodollar Holder
Advance, as the case may be, outstanding on such day; and
(ii) the remainder of (x) a fraction the numerator of which is the
rate (expressed as a decimal) at which interest accrues on such Eurodollar Loan
or Eurodollar Holder Advance, as the case may be, for such Interest Period as
provided in the Credit Agreement or the Trust Agreement, as the case may be
(less the Applicable Percentage), and the denominator of which is one (1) minus
the effective rate (expressed as a decimal) at which such reserve requirements
are imposed on such Financing Party on such day minus (y) such numerator; and
(iii) 1/360.
(d) Without affecting its rights under Sections 11.3(a), 11.3(b) or
11.3(c) 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 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
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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
Financing Party shall notify the Agent 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 Financing Party to perform its obligations hereunder to make or maintain
Eurodollar Loans or Eurodollar Holder Advances, as the case may be, then (i)
each Eurodollar Loan or Eurodollar Holder Advance, as the case may be, will
automatically, at the earlier of the end of the Interest Period for such
Eurodollar Loan or Eurodollar Holder Advance, as the case may be, or the date
required by law, convert into an ABR Loan or an ABR Holder Advance, as the case
may be, and (iii) the obligation of the Financing Parties to make, convert or
continue Eurodollar Loans or Eurodollar Holder Advances, as the case may be,
shall be suspended until the Agent shall notify the Lessee that such Financing
Party has determined that the circumstances causing such suspension no longer
exist.
(g) If, with respect to any Advances consisting of Eurodollar Loans and
Eurodollar Holder Advances required by the Borrower, the Agent or the Majority
Secured Parties shall have determined in good faith (which determination
shall, save for manifest error, be conclusive and binding upon the Borrower)
that (a) deposits of sufficient amount and maturity for funding such Advances
are not available to the Lenders or the Holders in the relevant market in the
ordinary course of business or (b) by reason of circumstances affecting the
relevant market, adequate and fair means do not exist for ascertaining the rate
of interest to be applicable to such Advances, then (i) the Agent or the
Majority Secured Parties, as the case may be, shall promptly give notice
thereof to the Borrower, (ii) the notice requesting such Borrowing shall,
unless the Borrower otherwise notifies the Agent, automatically be amended to
request ABR Loans and ABR Holder Advances instead of Eurodollar Loans and
Eurodollar Holder Advances, and (iii) no Lender or Holder, as the case may be,
shall be under any obligation to make additional Eurodollar Loans and
Eurodollar Holder Advances to the Borrower, unless and until the Agent shall
have notified the Borrower that such Eurodollar Loans and Eurodollar Holder
Advances are again available hereunder.
11.4. FUNDING/CONTRIBUTION INDEMNITY.
Subject to the provisions of Section 2.11(a) of the Credit Agreement and
3.9(a) of the Trust Agreement, as the case may be, the Lessee agrees to
indemnify each Financing Party and to hold each Financing Party harmless from
any loss or reasonable expense which such Financing Party may sustain or incur
as a consequence of (a) any default in connection with the drawing of
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funds for any Advance, (b) any default in making any repayment 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 or Eurodollar Holder Advances, as the case may be, on a day which is not
the last day of an Interest Period with respect thereto. Such indemnification
shall be in an amount equal to the excess, if any, of (x) the amount of interest
or Holder Yield, as the case may be, 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 Applicable Percentage for such Loan or Holder Advance, as the case
may be, 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 (i) (in the case of the Lenders)
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) (in the
case of the Holders) placing such amount on deposit for a comparable period with
leading banks in the relevant interest rate market. 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.
SUBJECT TO AND LIMITED BY IN ALL RESPECTS THE PROVISIONS OF SECTION 11.6
THROUGH 11.8 AND WITHOUT LIMITING THE GENERALITY OF THE INDEMNIFICATION
PROVISIONS OF ANY AND ALL OF THE OPERATIVE AGREEMENTS, 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 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.
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11.6 ADDITIONAL PROVISIONS REGARDING ENVIRONMENTAL INDEMNIFICATION.
Subject to the following sentence, 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 any Property, the Lease, the Agency Agreement or the
Indemnity Provider (including without limitation the rights and benefits
provided pursuant to Section 11.1(c). Notwithstanding any provision in this
Section 11 to the contrary, the Indemnity Provider shall not be obligated to
indemnify any Person for any Claim arising from or out of with respect to
environmental matters, violations of any Environmental Law, any Environmental
Claim or loss of or damage to any Property or the environment relating to any
Property, the Lease, the Agency Agreement or the Indemnity Provider to the
extent such Claim is subject to indemnification by Raytheon or ▇▇▇▇▇▇▇▇▇ and
Raytheon or ▇▇▇▇▇▇▇▇▇, as the case may be, has actually indemnified such Person
with respect to such Claim.
11.7 ADDITIONAL PROVISIONS REGARDING INDEMNIFICATION.
Notwithstanding the provisions of Sections 11.1, 11.2 and 11.5 (other than
with respect to matters concerning environmental indemnification referenced in
Section 11.6), (a) the Owner Trustee shall be the only beneficiary of the
provisions set forth in Sections 11.1, 11.2 and 11.5 (again, subject to the
immediately preceding parenthetical phrase) with respect to each Property solely
for the period prior to the earlier to occur of the applicable Completion Date
or Construction Period Termination Date for such Property, as applicable, 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. After the
earlier to occur of the applicable Completion Date or Construction Period
Termination Date for such Property, as applicable, each Indemnified Person shall
be a beneficiary of the provisions set forth in Sections 11.1, 11.2 and 11.5
11.8 INDEMNIFICATIONS PROVIDED BY THE OWNER TRUSTEE IN FAVOR OF THE OTHER
INDEMNIFIED PERSONS.
To the extent the Indemnity Provider is not obligated to indemnify each
Indemnified Person with respect to the various matters described in this Section
11.8, the Owner Trustee shall provide such indemnities (but only to the extent
amounts sufficient to pay such indemnity are funded by the Lenders and the
Holders) in favor of each Indemnified Person in accordance with this Section
11.8 and shall pay all such amounts owed with respect to this Section 11.8 with
amounts advanced by the Lenders and the Holders(a) to the extent, but only to
the extent, amounts are available therefor with respect to the Available
Commitments and the Available Holder Commitments (subject to the rights of the
Lenders and the Holders to increase their respective commitment amounts in
accordance with the provisions of Sections 5.9) and (b) unless each Lender and
each Holder has declined in writing to fund such amount. Notwithstanding any
other provision in any other Operative Agreement to the contrary, all
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amounts so advanced shall be deemed added (ratably, based on the ratio of the
Property Cost for each Property individually to the Aggregate Property Cost of
all Properties at such time) to the Property Cost of all Properties then
subject to the terms of the Operative Agreements.
Whether or not any of the transactions contemplated hereby shall be
consummated, the Owner Trustee hereby assumes liability for and agrees to
defend, indemnify and hold harmless each Indemnified Person on an After Tax
Basis from and against any Claims, which may be imposed on, incurred by or
asserted against an Indemnified Person by any 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 itself, as determined by a court of competent
jurisdiction, as opposed to gross negligence or willful misconduct imputed to
such Indemnified Person or breach of such Indemnified Person's obligations
under this Agreement, the Lease or any other Operative Agreement) 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 any Property or any component thereof,
including without limitation Claims in any way relating to or arising or
alleged to arise out of the matters set forth in Sections 11.1(a) through
11.1(h).
The Owner Trustee shall pay and assume liability for, and does hereby
agree to indemnify, protect and defend each Property and all Indemnified
Persons, and hold them harmless against, all Impositions on an After Tax Basis,
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.
Notwithstanding anything to the contrary in this paragraph, the Excluded Taxes
shall be excluded from the indemnity provisions afforded by this paragraph.
THE INDEMNITY OBLIGATIONS UNDERTAKEN BY THE OWNER TRUSTEE PURSUANT TO THIS
SECTION 11.8 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 any Property to the Owner Trustee, the
acquisition of any Property (or any of its components), the construction of any
Improvements, the Completion of any Property, any disposition of any interest
of the Owner Trustee in any Property or any interest of the Holders in the
Trust Estate, the payment of the Notes and any disposition thereof and shall be
and continue in effect notwithstanding any investigation made by any party and
the fact that any party may waive compliance with any of the other terms,
provisions or conditions of any of the Operative Agreements. Except as
otherwise expressly set forth herein or in other Operative Agreements, the
indemnities of the
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parties provided for in the Operative Agreements shall survive the expiration or
termination of any thereof.
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) business 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 or the Lessee, or to any Guarantor, to
such entity at the following address:
Veritas Software Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Owner Trustee, to it at the following address:
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Holders, to each such Holder at the address set forth for
such Holder on Schedule I of the Trust Agreement.
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If to the Agent, to it at the following address:
NationsBank, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to any Lender, to it at the address set forth for such Lender in
Schedule 2.1 of the Credit Agreement.
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 Basic Document may be terminated, amended, supplemented, waived or
modified only by an instrument in writing sign by, subject to Article VIII of
the Trust Agreement regarding termination of the Trust Agreement, the Majority
Secured Parties, the Agent and each Credit Party (to the extent such Credit
Party is a party to such Basic Document); provided, to the extent no Default or
Event of Default shall have occurred and be continuing, the Majority Secured
Parties shall not amend, supplement, waive or modify any provision of any Basic
Document 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. Each Operative Agreement which is not a Basic Document
may be terminated, amended, supplemented, waived or modified only by an
instrument in writing signed by the parties thereto and (without the consent of
any other Financing Party) the Agent. In addition, the Unanimous Vote Matters
shall require the consent of each Lender and each Holder affected by such
matter.
Notwithstanding the foregoing, no such termination, amendment,
supplement, waiver or modification shall, without the consent of the Agent and,
to the extent affected thereby, each Lender and each Holder (collectively, the
"Unanimous Vote Matters") (i) reduce the amount of any Note or any Certificate,
extend the scheduled date of maturity of any Note, extend the scheduled
Expiration Date, extend any payment date of any Note or Certificate, reduce the
stated rate of interest payable on any Note, reduce the stated Holder Yield
payable on any Certificate (other than as a result of waiving the applicability
of any post-default increase in interest rates or Holder Yields), modify the
priority of any Lien in favor of the Agent under any Security
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Document, subordinate any obligation owed to such Lender or Holder, reduce any
Lender Commitment Fees or any Holder Commitment Fees payable to such Lender or
Holder (as the case may be) under this Participation Agreement, extend the
scheduled date of payment of any Lender Commitment Fees or any Holder Commitment
Fees payable to such Lender or Holder (as the case may be), fund any Advance
referenced in Section 2.1 of the Agency Agreement in excess of the then current
aggregate sum of the Available Commitments and the Available Holder Commitments,
elect to decline the funding of any Transaction Expense with respect to Sections
7.1(a) or 7.1(b), elect to decline the funding of any indemnity payment by the
Owner Trustee with respect to Section 11.8 or increase the amount or extend the
expiration date of such Lender's Commitment or the Holder Commitment of such
Holder, or (ii) terminate, amend, supplement, waive or modify any provision of
this Section 12.4 or reduce the percentages specified in the definitions of
Majority Lenders, Majority Holders or Majority Secured Parties, or consent to
the assignment or transfer by the Owner Trustee of any of its rights and
obligations under any Credit Document or release a material portion of the
Collateral (except in accordance with Section 8.8) or release any Credit Party
from its obligations under any Operative Agreement or otherwise alter any
payment obligations of any Credit Party to the Lessor or any Financing Party
under the Operative Agreements, or (iii) terminate, amend, supplement, waive or
modify any provision of Section 7 of the Credit Agreement (which shall also
require the consent of the Agent), or (iv) eliminate the automatic option under
Section 5.3(b) of the Agency Agreement requiring that the Construction Agent pay
certain liquidated damages in exchange for the conveyance of a Property to the
Construction Agent, or (v) permit the extension of the Construction Period
beyond the date that is two (2) years from the Initial Closing Date. Any such
termination, amendment, supplement, waiver or modification shall apply equally
to each of the Lenders and the Holders and shall be binding upon all the parties
to this Agreement. In the case of any waiver, each party to this Agreement shall
be restored to its former position and rights under the Operative Agreements,
and any Default or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon.
If at a time when the conditions precedent set forth in the Operative
Agreements to any Loan are, in the opinion of the Majority Lenders, satisfied,
any Lender shall fail to fulfill its obligations to make such Loan (any such
Lender, a "Defaulting Lender") then, for so long as such failure shall continue,
the Defaulting Lender shall (unless the Lessee and the Majority Lenders,
determined as if the Defaulting Lender were not a "Lender", shall otherwise
consent in writing) be deemed for all purposes relating to terminations,
amendments, supplements, waivers or modifications under the Operative Agreements
to have no Loans, shall not be treated as a "Lender" when performing the
computation of Majority Lenders or Majority Secured Parties, and shall have no
rights under this Section 12.4; provided that any action taken pursuant to the
second paragraph of this Section 12.4 shall not be effective as against the
Defaulting Lender.
If at a time when the conditions precedent set forth in the Operative
Agreements to any Holder Advance are, in the opinion of the Majority Holders,
satisfied, any Holder shall fail to fulfill its obligations to make such Holder
Advance (any such Holder, a "Defaulting Holder") then, for so long as such
failure shall continue, the Defaulting Holder shall (unless the Lessee and the
Majority Holders, determined as if the Defaulting Holder were not a "Holder",
shall
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otherwise consent in writing) be deemed for all purposes relating to
terminations, amendments, supplements, waivers or modifications under the
Operative Agreements to have no Holder Advances, shall not be treated as a
"Holder" when performing the computation of Majority Holders or Majority
Secured Parties, and shall have no rights under this Section 12.4; provided
that any action taken pursuant to the second paragraph of this Section 12.4
shall not be effective as against the Defaulting Holder.
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 LAWS OF THE STATE OF NEW YORK. 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 California in ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ for the Northern District of California, 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 three (3) 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.
(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 THIS AGREEMENT, ANY OTHER OPERATIVE AGREEMENT
AND FOR ANY COUNTERCLAIM THEREIN.
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(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 that any such action or
proceeding brought in any such court has been brought in an inconvenient
forum.
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) The Lenders, the Agent, the Credit Parties, the Owner Trustee and
the Holders each acknowledge and agree that the Owner Trustee is (except as
otherwise expressly provided herein or therein) entering into this
Agreement and the other Operative Agreements to which it is a party (other
than the Trust Agreement and to the extent otherwise provided in Section
6.1 of this Agreement), solely in its capacity as trustee under the Trust
Agreement and not in its individual capacity and that the Trust Company
shall not be liable or accountable under any circumstances whatsoever in
its individual capacity for or on account of any statements,
representations, warranties, covenants or obligations stated to be those of
the Owner Trustee, except for its own gross negligence or willful
misconduct and as otherwise expressly provided herein or in the other
Operative Agreements.
(b) Anything to the contrary contained in this Agreement, the Credit
Agreement, the Notes or in any other Operative Agreement notwithstanding,
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, 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 Lenders,
the Holders and the Agent agree that, in the event any remedies under any
Operative Agreement are pursued, neither the Lenders, the Holders nor the
Agent shall have any recourse against any Exculpated Person, for any
deficiency, loss or Claim for monetary damages or otherwise resulting
therefrom and recourse shall be had solely and exclusively against the
Trust Estate (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 recourse against or
the enforcement of remedies against the Trust Estate (excluding Excepted
Payments) in
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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 and/or the Certificates 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 any to the extent of the damages
arising by reason of): active waste knowingly committed by any Exculpated
Person with respect to any 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
Lesser (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 Lesser 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 Lesser or (C)
except for Excepted Payments, any rent or other income 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 Properties 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
Trust Estate (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 Owner Trustee under the Credit
Agreement, 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 Section 6B and (b)
receive all amounts then held under the Operative Agreements and all proceeds
with respect to any of the Properties. Upon the termination of the Lease and
Section 6B pursuant to the foregoing clause (a), the Lessor shall transfer to
the Lessee all of its right, title and interest free and clear of the Lien of
the Lease, the Lien of the Security Documents and all Lessor Liens in and to any
Properties then subject to the Lease and any amounts or proceeds referred to in
the foregoing clause (b) be paid over to the Lessee.
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 assurances as the other parties may from time to time
reasonably request in order to carry out and effectuate
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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 Owner Trustee shall so request) as so requested, in order to
maintain and protect all security interests provided for hereunder or under any
other Operative Agreement. In addition, in connection with the sale or other
disposition of any Property or any portion thereof, the Lessee agrees to
execute such instruments of conveyance as may be reasonably required 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 Owner Trustee
shall be made by the Agent and that such calculations and determinations shall
be conclusive and binding on the parties hereto in the absence of manifest
error.
12.13. CONFIDENTIALITY.
Each Financing Party agrees to keep confidential any information furnished
or made available to it by any Credit Party or any of its Subsidiaries pursuant
to this Agreement that is marked confidential; provided that nothing herein
shall prevent any Financing Party from disclosing such information (a) to any
other Financing Party or any Affiliate of any Financing Party, or any officer,
director, employee, agent, or advisor of any Financing Party of Affiliate of
any Financing Party, (b) to any other Person if reasonably incidental to the
administration of the credit facility provided herein, (c) as required by any
law, rule, or regulation, (d) upon the order of any court or administrative
agency, (e) upon the request or demand of any regulatory agency or authority,
(f) that is or becomes available to the public or that is or becomes available
to any Financing Party other than as a result of a disclosure by any Financing
Party prohibited by this Agreement, (g) in connection with any litigation to
which such Financing Party or any of its Affiliates may be a party, (h) to the
extent necessary in connection with the exercise of any remedy under this
Agreement or any other Operative Agreement, and (i) subject to provisions
substantially similar to those contained in this Section, to any actual or
proposed participant or assignee.
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.
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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, upon and after the occurrence
of any Event of Default and during the continuance thereof, the Lenders, the
Holders, their respective Affiliates and any assignee or participant of a
Lender or a Holder 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 Lenders, the Holders, their respective Affiliates or any assignee
or participant of a Lender or a Holder 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 Lenders
or the Holders 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 Majority Secured
Parties, and any Financing Party violating this provision shall indemnify the
Agent and the other Financing Parties from any and all costs, expenses,
liabilities and damages resulting therefrom. 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.
[signature pages follow]
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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 AGENT
AND LESSEE: VERITAS SOFTWARE CORPORATION, as the
Construction Agent and as the Lessee
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Title: Senior Vice President
------------------------------------
OWNER TRUSTEE
AND LESSOR: FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually, except as expressly
stated herein, but solely as the Owner
Trustee under the VS Trust 1999-1
By:
------------------------------------
Name:
------------------------------------
Title:
------------------------------------
AGENT AND LENDERS: NATIONSBANK, N.A., as a Lender and as the
Agent
By:
------------------------------------
Name:
------------------------------------
Title:
------------------------------------
COMMERCIA BANK-CALIFORNIA, as a Lender
By:
------------------------------------
Name:
------------------------------------
Title:
------------------------------------
79
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 AGENT
AND LESSEE: VERITAS SOFTWARE CORPORATION, as the
Construction Agent and as the Lessee
By:
------------------------------------
Name:
------------------------------------
Title:
------------------------------------
OWNER TRUSTEE
AND LESSOR: FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually, except as expressly
stated herein, but solely as the Owner
Trustee under the VS Trust 1999-1
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Title: Vice President
------------------------------------
AGENT AND LENDERS: NATIONSBANK, N.A., as a Lender and as the
Agent
By:
------------------------------------
Name:
------------------------------------
Title:
------------------------------------
COMERICA BANK-CALIFORNIA, as a Lender
By:
------------------------------------
Name:
------------------------------------
Title:
------------------------------------
80
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 AGENT
AND LESSEE: VERITAS SOFTWARE CORPORATION, as the
Construction Agent and as the Lessee
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
OWNER TRUSTEE
AND LESSOR: FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not individually, except as
expressly stated herein, but solely as the
Owner Trustee under the VS Trust 1999-1
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
AGENT AND LENDERS: NATIONSBANK, N.A., as a Lender and as the
Agent
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------
Title: VICE PRESIDENT
--------------------------------
COMERICA BANK-CALIFORNIA, as a Lender
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
81
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 AGENT
AND LESSEE: VERITAS SOFTWARE CORPORATION, as the
Construction Agent and as the Lessee
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
OWNER TRUSTEE
AND LESSOR: FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not individually, except as
expressly stated herein, but solely as the
Owner Trustee under the VS Trust 1999-1
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
AGENT AND LENDERS: NATIONSBANK, N.A., as a Lender and as the
Agent
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
COMERICA BANK-CALIFORNIA, as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. Ways
----------------------------------
Name: ▇▇▇▇▇▇ ▇. Ways
--------------------------------
Title: Corporate Banking Officer
-------------------------------
82
KEY BANK NATIONAL ASSOCIATION, as a
Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Title: Assistant Vice President
-------------------------------
FLEET NATIONAL BANK, as a Lender
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
[signature pages continued]
83
KEY BANK NATIONAL ASSOCIATION, as a
Lender
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
FLEET NATIONAL BANK, as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Title: VP
------------------------------------
[signature pages continued]
84
HOLDERS: NATIONSBANK, N.A., as a Holder
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: VICE PRESIDENT
------------------------------------
KEY BANK NATIONAL ASSOCIATION as a
Holder
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
FLEET NATIONAL BANK, as a Holder
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
85
HOLDERS: NATIONSBANK, N.A., as a Holder
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
KEY BANK NATIONAL ASSOCIATION as a
Holder
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Title: Assistant Vice President
---------------------------------
FLEET NATIONAL BANK, as a Holder
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
86
HOLDERS: NATIONSBANK, N.A., as a Holder
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
KEY BANK NATIONAL ASSOCIATION as a
Holder
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
FLEET NATIONAL BANK, as a Holder
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Title: VP
---------------------------------
87
Schedule 8.3A(a)(iii)
[FORM OF OFFICER'S COMPLIANCE CERTIFICATE]
For the fiscal quarter ended _____________, 19__.
I, ___________________, _____________________ of VERITAS SOFTWARE
CORPORATION (the "Lessee") hereby certify that, to the best of my knowledge and
belief, with respect to that certain Participation Agreement dated as of April
23, 1999 (as amended, modified, restated or supplemented from time to time, the
"Participation Agreement"; all of the defined terms in the Credit Agreement are
incorporated herein by reference) among the Lessee, the Lessor, the Guarantors,
the Lenders, the Holders and NationsBank, N.A., as Agent:
a. The company-prepared financial statements which accompany this
certificate are true and correct in all material respects and have
been prepared in accordance with GAAP applied on a consistent basis,
subject to changes resulting from normal year-end audit adjustments.
b. Since ________________ (the date of the last similar certification,
or, if none, the Initial Closing Date) no Default or Event of Default
has occurred; and
Delivered herewith are detailed calculations demonstrating compliance by
the Credit Parties with the financial covenants contained in Section 8.3A (h)
of the Participation Agreement, and setting forth the ratio of Funded
Indebtedness to EBITDA and level of EBITDA, pursuant to Section 8.3(k) of the
Participation Agreement as of the end of the fiscal period referred to above.
This ____ day of _____________, 19__.
VERITAS SOFTWARE CORPORATION
By:_________________________________
Name:_______________________________
Title:______________________________
88
Attachment to Officer's Certificate
COMPUTATION OF FINANCIAL COVENANTS
89
Schedule 8.3B(a)(ii)
[SCHEDULE OF INDEBTEDNESS]
1. $100,000,000 5 1/4% CONVERTIBLE SUBORDINATED NOTES DUE 2004
1. LETTER OF CREDIT FOR $231,000 IN FAVOR OF SGI
90
Schedule 8.3B(e)
[SCHEDULE OF INSIGNIFICANT LINES OF BUSINESS]
None
91
Schedule 8.3B(f)
[SCHEDULE OF INVESTMENTS]
None
92
EXHIBIT A
REQUISITION FORM
(Pursuant to Sections 4.2, 5.2, 5.3 and 5.4 of the Participation Agreement)
VERITAS SOFTWARE CORPORATION, a Delaware corporation (the "Company")
hereby certifies as true and correct and delivers the following Requisition to
NATIONSBANK, N.A., as the agent for the Lenders (hereinafter defined) and
respecting the Security Documents, as the agent for the Lenders and the Holders
(hereinafter defined), to the extent of their interests (the "Agent"):
Reference is made herein to that certain Participation Agreement dated as
of April 23, 1999 (as amended, modified, extended, supplemented, restated and/or
replaced from time to time, the "Participation Agreement") among the Company,
in its capacity as the Lessee and as the Construction Agent, the various
parties thereto from time to time, as the guarantors (the "Guarantors"), First
Security Bank, National Association, as the Owner Trustee, the various banks
and other lending institutions which are parties thereto from time to time, as
holders (the "Holders"), the various banks and other lending institutions which
are parties thereto from time to time, as lenders (the "Lenders"), and the
Agent. Capitalized terms used herein but not otherwise defined herein shall
have the meanings set forth therefor in the Participation Agreement.
Check one:
____ INITIAL CLOSING DATE:_____________________________
(three (3) Business Days prior notice required for Advance)
____ PROPERTY 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 (with supporting invoices or closing
statement attached):
A-1
93
Party to Whom Amount Owed
Amount is Owed (in U.S. Dollars)
---------------- ----------------
---------------- ----------------
---------------- ----------------
---------------- ----------------
---------------- ----------------
2. Description of Land (which shall be a legal description of the Land in
connection with an Advance to pay Property Acquisition Costs): See
attached Schedule 1
3. Description of Improvements: See attached Schedule 2
4. Description of Equipment: See attached Schedule 3
5. Description of Work: See attached Schedule 4
6. Aggregate Loans and Holder Advances requested since the Initial Closing
Date with respect to each Property for which Advances are requested under
this Requisition (listed on a Property by Property basis), including
without limitation all amounts requested under this Requisition: [IDENTIFY
ON A PROPERTY BY PROPERTY BASIS]
$ [Property]
------------------
In connection with this Requisition, the Company hereby requests that the
Lenders make Loans to the Lessor in the amount of $----------- and that the
Holders make Holder Advances to the Lessor in the amount of $-----------------.
The Company hereby certifies (i) that the foregoing amounts requested do not
exceed the total aggregate of the Available Commitments plus the Available
Holder Commitments and (ii) each of the provisions of the Participation
Agreement applicable to the Loans and Holder Advances requested hereunder have
been complied with as of the date of this Requisition.
The Company requests the Loans be allocated as follows:
$------------------ ABR Loans
$------------------ Eurodollar Loans
The Company requests the Holder Advances be allocated as follows:
$------------------ ABR Holder Advances
$------------------ Eurodollar Holder Advances
A-2
94
The Company has caused this Requisition to executed by its duly
authorized officer as of this --------- day of -----------------, -------.
VERITAS SOFTWARE CORPORATION
By:
----------------------------------
Name:
----------------------------------
Title:
----------------------------------
A-3
95
Schedule 1
Description of Land
(Legal Description and Street Address)
A-4
96
Schedule 2
Description of Improvements
A-5
97
Schedule 3
Description of Equipment
General Description Make Model Serial Number
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
A-6
98
Schedule 4
Work
Work Performed for which the Advance is requested:
----------------------------------------------------------
----------------------------------------------------------
A-7
99
EXHIBIT B
[Reserved]
▇-▇
▇▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇ SOFTWARE CORPORATION
OFFICER'S CERTIFICATE
(Pursuant to Section 5.3(z) of the Participation Agreement)
VERITAS SOFTWARE CORPORATION, a Delaware corporation (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.
2. No Default or 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.
4. The Company 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 April 23, 1999 among the Company, as the Lessee and as the
Construction Agent, the various parties thereto from time to time, as guarantors
(the "Guarantors"), First Security Bank, National Association, as the Owner
Trustee, the various banks and other lending institutions which are parties
thereto from time to time, as holders (the "Holders"), the various banks and
other lending institutions which are parties thereto from time to time, as
lenders (the "Lenders") and NationsBank, N.A., as the agent for the Lenders and
respecting the Security Documents, as the agent for the Lenders and the Holders,
to the extent of their interests (the "Agent").
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be
duly executed and delivered as of this ______ day of __________, ____.
VERITAS SOFTWARE CORPORATION
By: __________________________
Name: ________________________
Title: _______________________
▇-▇
▇▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇ SOFTWARE CORPORATION
SECRETARY'S CERTIFICATE
(Pursuant to Section 5.3(aa) of the Participation Agreement)
VERITAS SOFTWARE CORPORATION, a Delaware 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 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
102
IN WITNESS WHEREOF, the Company has caused this Secretary's Certificate to
be duly executed and delivered as of this day of , .
VERITAS SOFTWARE CORPORATION
By:
---------------------------
Name:
---------------------------
Title:
--------------------------
D-2
103
Schedule I
Board Resolutions
D-3
104
Schedule 2
Articles of Incorporation
▇-▇
▇▇▇
▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇
▇-▇
106
EXHIBIT E
FIRST SECURITY BANK, NATIONAL ASSOCIATION
OFFICER'S CERTIFICATE
(Pursuant to Section 5.3(bb) of the Participation Agreement)
FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national banking association,
not individually (except with respect to paragraph 1 below, to the extent any
such representations and warranties are made in its individual capacity) but
solely as the owner trustee under the VS Trust 1999-1 (the "Owner Trustee"),
DOES HEREBY CERTIFY as follows:
1. Each and every representation and warranty of the Owner Trustee
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 Owner Trustee is a party is in
full force and effect with respect to it.
3. The Owner Trustee 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 April 23, 1999 (the "Participation Agreement") among
Veritas Software Corporation, as the Lessee and as the Construction Agent, the
various parties thereto from time to time, as guarantors (the "Guarantors"), the
Owner Trustee, the various banks and other lending institutions which are
parties thereto from time to time, as holders (the "Holders"), the various banks
and other lending institutions which are parties thereto from time to time, as
lenders (the "Lenders") and NationsBank, N.A., as the agent for the Lenders and
respecting the Security Documents, as the agent for the Lenders and the Holders,
to the extent of their interests (the "Agent").
E-1
107
IN WITNESS WHEREOF, the Owner Trustee has caused this Officer's Certificate
to be duly executed and delivered as of this ___ day of ________, _________.
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually, except as expressly
stated herein, but solely as the Owner
Trustee under the VS Trust 1999-1
By: ________________________________
Name: ______________________________
Title: _____________________________
▇-▇
▇▇▇
▇▇▇▇▇▇▇ ▇
FIRST SECURITY BANK NATIONAL ASSOCIATION
SECRETARY'S CERTIFICATE
(Pursuant to Section 5.3(cc) of the Participation Agreement)
CERTIFICATE OF ASSISTANT SECRETARY
I, _____________________, duly elected and qualified Assistant Secretary of
the Board of Directors of First Security Bank, National Association (the
"Association"), hereby certify as follows:
1. The Association is a National Banking Association duly organized,
validly existing and in good standing under the laws of the United States. With
respect thereto the following is noted:
A. Pursuant to Revised Statutes 324, et seq., as amended, 12 U.S.C. 1, et
seq., the Comptroller of the Currency charters and exercises
regulatory and supervisory authority over all National Banking
Associations;
B. On December 9, 1881, the First National Bank of Ogden, Utah was
chartered as a National Banking Association under the laws of the
United States and under Charter No. 2597;
C. On October 2, 1922, in connection with a consolidation of The First
National Bank of Ogden, Ogden, Utah and The Utah National Bank of Ogden,
Ogden, Utah, the title was changed to "The First & Utah National Bank of
Ogden", on January 18, 1923, The First & Utah National Bank of Ogden
changed its title to "First Utah National Bank of Ogden"; on January
19, 1926, the title was changed to "First National Bank of Ogden"; on
February 24, 1934, the title was changed to "First Security Bank of
Utah, National Association"; on June 21, 1996, the title was changed
to "First Security Bank, National Association"; and
D. First Security Bank, National Association, Ogden, Utah, continues to
hold a valid certificate to do business as a National Banking
Association.
2. The Association's Articles of Association, as amended, are in full
force and effect, and a true, correct and complete copy is attached hereto as
Schedule A and incorporated herein by reference. Said Articles were last
amended October 20, 1975, as required by law on notice at a duly called special
meeting of the shareholders of the Association.
F-1
109
3. The Association By-Laws, as amended, are in full force and effect;
and a true, correct and complete copy is attached hereto as Schedule B and
incorporated herein by reference. Said By-Laws, still in full force and effect,
were adopted September 17, 1942, by resolution, after proper notice of
consideration and adoption of By-Laws was given to each and every shareholder,
at a regularly called meeting of the Board of Directors with a quorum present.
4. Pursuant to the authority vested in it by an Act of Congress approved
December 23, 1913 and known as the Federal Reserve Act, as amended, the Federal
Reserve Board (now the Board of Governors of the Federal Reserve System) has
granted to the Association now known as "First Security Bank, National
Association" of Ogden, Utah, the right to act, when not in contravention of
State or local law, as trustee, executor, administrator, registrar of stocks
and bonds, guardian of estates, assignee, receiver, committee of estates of
lunatics, or in any other fiduciary capacity in which State banks, trust
companies or other corporations which come into competition with National Banks
are permitted to act under the laws of the State of Utah; and under the
provisions of applicable law, the authority so granted remains in full force
and effect.
5. Pursuant to authority vested by Act of Congress (12 ▇.▇.▇. ▇▇▇ ▇▇▇ ▇▇
▇.▇.▇. ▇▇▇, as amended) the Comptroller of the Currency has issued Regulation
9, as amended, dealing, in part, with the Fiduciary Powers of National Banks,
said regulation providing in subparagraph 9.7(a)(1-2):
(1) The board of directors is responsible for the proper exercise of
fiduciary powers by the Bank. All matters pertinent thereto,
including the determination of policies, the investment and
disposition of property held in fiduciary capacity, and the
direction and review of the actions of all officers, employees,
and committees utilized by the Bank in the exercise of its
fiduciary powers, are the responsibility of the board. In
discharging this responsibility, the board of directors may
assign, by action duly entered in the minutes, the administration
of such of the Bank's fiduciary powers as it may consider proper
to assign to such director(s), officer(s), employee(s) or
committee(s) as it may designate.
(2) No fiduciary account shall be accepted without the prior approval
of the board, or of the director(s), officer(s), or committee(s) to
whom the board may have designated the performance of that
responsibility....
6. A Resolution relating to Exercise of Fiduciary Powers was adopted
by the Board of Directors at a meeting held July 26, 1994 at which time there
was a quorum present, said resolution is still in full force and effect and has
not been rescinded. Said resolution is attached hereto as Schedule C and
incorporated herein by reference.
F-2
110
7. A Resolution relating to the Designation of Officers and Employees to
Exercise Fiduciary Powers was adopted by the Trust Policy Committee at a
meeting held February 7, 1996 at which time a quorum was present; said
resolution is still in full force and effect and has not been rescinded. Said
resolution is attached hereto as Schedule D and is incorporated herein by
reference.
8. Attached hereto as Schedule E and incorporated herein by reference,
is a listing of facsimile signatures of persons authorized (herein "Authorized
Signatory or Signatories") on behalf of the Association and its Trust Group to
act in exercise of its fiduciary powers subject to the resolutions in Paragraphs
6 and 7, above.
9. The principal office of the First Security Bank, National
Association, Trust Group and of its departments, except for the St. ▇▇▇▇▇▇,
Utah, Ogden, Utah, and Provo, Utah, branch offices, is located at ▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ and all records relating to fiduciary
accounts are located at such principal office of the Trust Group or in storage
facilities within Salt Lake County, Utah, except for those of the Ogden, Utah,
St. ▇▇▇▇▇▇, Utah, and Provo, Utah, branch offices, which are located at said
office.
10. Each Authorized Signatory (i) is a duly elected or appointed, duly
qualified officer or employee of the Association; (ii) holds the office or job
title set forth below his or her name on the date hereof; (iii) and the
facsimile signature appearing opposite the name of each such officer or
employee is a true replica of his or her signature.
F-3
111
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the
Association this ------------- day of -----------------, --------.
(SEAL)
--------------------------------
R. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Senior Vice President
Assistant Secretary
F-4
112
Schedule A
Articles of Association
F-5
113
Schedule B
Bylaws
F-6
114
Schedule C
Resolution Relating to
Exercise of Fiduciary Powers
F-7
115
Schedule D
Resolution Relating to the
Designation of Officers and Employees
To Exercise Fiduciary Powers
F-8
116
Schedule E
Authorized Signatory or Signatories
F-9
117
EXHIBIT G
[Outside Counsel Opinion for the Owner Trustee]
(Pursuant to Section 5.3(dd) of the
Participation Agreement)
----------------, ----
TO THOSE ON THE ATTACHED DISTRIBUTION LIST
Re: Trust Agreement dated as of April 23, 1999
Dear Sirs:
We have acted as special counsel for First Security Bank, National
Association, a national banking association, in its individual capacity ("FSB")
and in its capacity as trustee (the "Owner Trustee") under the Trust Agreement
dated as of April 23, 1999 (the "Trust Agreement") by and among it and the
various banks and other lending institutions which are parties thereto from time
to time, as holders (the "Holders"), in connection with the execution and
delivery by the Owner Trustee of the Operative Agreements to which it is a
party. Except as otherwise defined herein, the terms used herein shall have the
meanings set forth in Appendix A to the Participation Agreement dated as of
April 23, 1999 (the "Participation Agreement") by and among Veritas Software
Corporation (the "Lessee"), the various parties thereto from time to time, as
guarantors (the "Guarantors"), First Security Bank, National Association, as the
Owner Trustee, the Holders, the various banks and other lending institutions
which are parties thereto from time to time, as lenders (the "Lenders") and
NationsBank, N.A., as the agent for the Lenders and respecting the Security
Documents, as the agent for the Lenders and the Holders, to the extent of their
interests (the "Agent").
We have examined originals or copies, certified or otherwise identified to
our satisfaction, of such documents, corporate records and other instruments as
we have deemed necessary or advisable for the purpose of rendering this opinion.
Based upon the foregoing, we are of the opinion that:
1. FSB is a national banking association duly organized, validly existing
and in good standing under the laws of the United States of America and each of
FSB and the Owner Trustee has under the laws of the State of Utah and federal
banking law the power and authority to enter into and perform its obligations
under the Trust Agreement and each other Operative Agreement to which it is a
party.
2. The Owner Trustee is the duly appointed trustee under the Trust
Agreement.
G-1
118
3. The Trust Agreement has been duly authorized, executed and delivered
by one (1) of the officers of FSB and, assuming due authorization, execution and
delivery by the Holders, is a legal, valid and binding obligation of the Owner
Trustee (and to the extent set forth therein, against FSB), enforceable against
the Owner Trustee (and to the extent set forth therein, against FSB) in
accordance with its terms, and the Trust Agreement creates under the laws of the
State of Utah for the Holders the beneficial interest in the Trust Estate it
purports to create and is a valid trust under the laws of the State of Utah.
4. The Operative Agreements to which it is party have been duly
authorized, executed and delivered by FSB, and, assuming due authorization,
execution and delivery by the other parties thereto, are legal, valid and
binding obligations of FSB, enforceable against FSB in accordance with their
respective terms.
5. The Operative Agreements to which it is party have been duly
authorized, executed and delivered by Owner Trustee, and, assuming due
authorization, execution and delivery by the other parties thereto, are legal,
valid and binding obligations of the Owner Trustee, enforceable against the
Owner Trustee in accordance with their respective terms. The Notes and
Certificates have been duly issued, executed and delivered by the Owner Trustee,
pursuant to authorization contained in the Trust Agreement, and the Certificates
are entitled to the benefits and security afforded by the Trust Agreement in
accordance with its terms and the terms of the Trust Agreement.
6. The execution and delivery by each of FSB and the Owner Trustee of the
Trust Agreement and the Operative Agreements to which it is a party, and
compliance by FSB or the Owner Trustee, as the case may be, with all of the
provisions thereof do not and will not contravene any Laws applicable to or
binding on FSB, or as the Owner Trustee, or contravene the provisions of, or
constitute a default under, its charter documents or by-laws or, to our
knowledge after due inquiry, any indenture, mortgage contract or other agreement
or instrument to which FSB or Owner Trustee is a party or by which it or any of
its property may be bound or affected.
7. The execution and delivery of the Operative Agreements by each of FSB
and the Owner Trustee and the performance by each of FSB and the Owner Trustee
of their respective obligations thereunder does not require on or prior to the
date hereof the consent or approval of, the giving of notice to, the
registration or filing with, or the taking of any action in respect of any
Governmental Authority or any court.
8. Assuming that the trust created by the Trust Agreement is treated as a
grantor trust for federal income tax purposes within the contemplation of
Section 671 through 678 of the Internal Revenue Code of 1986, there are no fees,
taxes, or other charges (except taxes imposed on fees payable to the Owner
Trustee) payable to the State of Utah or any political subdivision thereof in
connection with the execution, delivery or performance by the Owner Trustee, the
Agent, the Lenders, the Lessee or the Holders, as the case may be, of the
Operative Agreements or in connection with the acquisition of any Property by
the Owner Trustee or in connection with the making by any Holder of its
investment in the Trust or its acquisition of the beneficial
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interest in the Trust Estate or in connection with the issuance and acquisition
of the Certificates, or the Notes, and neither the Owner Trustee, the Trust
Estate nor the trust created by the Trust Agreement will be subject to any fee,
tax or other governmental charge (except taxes on fees payable to the Owner
Trustee) under the laws of the State of Utah or any political subdivision
thereof on, based on or measured by, directly or indirectly, the gross
receipts, net income or value of the Trust Estate by reason of the creation or
continued existence of the trust under the terms of the Trust Agreement
pursuant to the laws of the State of Utah or the Owner Trustee's performance of
its duties under the Trust Agreement.
9. There is no fee, tax or other governmental charge under the laws of the
State of Utah or any political subdivision thereof in existence on the date
hereof on, based on or measured by any payments under the Certificates, Notes or
the beneficial interest in the Trust Estate, by reason of the creation of the
trust under the Trust Agreement pursuant to the laws of the State of Utah or the
Owner Trustee's performance of its duties under the Trust Agreement within the
State of Utah.
10. Upon the filing of the financing statement on form UCC-1 in the form
attached hereto as Schedule 1 with the Utah Division of Corporation and
Commercial Code, the Agent's security interest in the Trust Estate, for the
benefit of the Lenders and the Holders, will be perfected, to the extent that
such perfection is governed by Article 9 of the Uniform Commercial Code as in
effect in the State of Utah (the "Utah UCC").
Your attention is directed to the Utah UCC, which provides, in part, that a
filed financing statement which does not state a maturity date or which states a
maturity date of more than five (5) years is effective only for a period of five
(5) years from the date of filing, unless within six (6) months prior to the
expiration of said period a continuation statement is filed in the same office
or offices in which the original statement was filed. The continuation statement
must be signed by the secured party, identify the original statement by file
number and state that the original statement is still effective. Upon the timely
filing of a continuation statement, the effectiveness of the original financing
statement is continued for five (5) years after the last date to which the
original statement was effective. Succeeding continuation statements may be
filed in the same manner to continue the effectiveness of the original
statement.
The foregoing opinions are subject to the following assumptions, exceptions and
qualifications:
A. We are attorneys admitted to practice in the State of Utah and in
rendering the foregoing opinions we have not passed upon, or purported to pass
upon, the laws of any jurisdictions other than the State of Utah and the federal
banking law governing the banking and trust powers of FSB. In addition, without
limiting the foregoing we express no opinion with respect to (i) federal
securities laws, including the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, and the Trust Indenture Act of
1939, as amended, (ii) the Federal Aviation Act of 1958, as amended, (iii) the
Federal Communications Act of 1934, as amended, or (iv) state securities or blue
sky laws. Insofar as the foregoing opinions relate to the legality, validity,
binding effect and enforceability of the documents involved in these
transactions, which by their terms are governed by the laws of a state other
than Utah, we have
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assumed that the laws of such state (as to which we express no opinion), are in
all material aspects identical to the laws of the State of Utah.
B. The opinions set forth in paragraphs 3, 4, and 5 above are subject to
the qualification that enforceability of the Trust Agreement and the other
Operative Agreements to which FSB and the Owner Trustee are parties, in
accordance with their respective terms, may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium, receivership or similar laws affecting
enforcement of creditors' rights generally, and (ii) general principles of
equity, regardless of whether such enforceability is considered in a proceeding
in equity or at law.
C. As to the documents involved in these transactions, we have assumed
that each is a legal, valid and binding obligation of each party thereto, other
than FSB or the Owner Trustee, and is enforceable against each such party in
accordance with their respective terms.
D. We have assumed that all signatures, other than those of the Owner
Trustee or FSB, on documents and instruments involved in these transactions are
genuine, that all documents and instruments submitted to us as originals are
authentic, and that all documents and instruments submitted to us as copies
conform with the originals, which facts we have not independently verified.
E. We do not purport to be experts in respect of, or express any opinion
concerning laws, rules or regulations applicable to the particular nature of the
equipment or property involved in these transactions.
F. We have made no investigation of, and we express no opinion
concerning, the nature of the title to any part of the equipment or property
involved in these transactions or the priority of any mortgage or security
interest.
G. We have assumed that the Participation Agreement and the transactions
contemplated thereby are not within the prohibitions of Section 406 of the
Employee Retirement Income Security Act of 1974.
H. In addition to any other limitation by operation of law upon the
scope, meaning, or purpose of this opinion, the opinions expressed herein speak
only as of the date hereof. We have no obligation to advise the recipients of
this opinion (or any third party) and make no undertaking to amend or supplement
such opinions if facts come to our attention or changes in the current law of
the jurisdictions mentioned herein occur which could affect such opinions the
legal analysis, a legal conclusion or any information confirmation herein.
I. This opinion is for the sole benefit of the Lessee, the Construction
Agent, the Guarantors, the Owner Trustee, the Holders, the Lenders, the Agent
and their respective successors and assigns in matters directly related to the
Participation Agreement or the transaction contemplated thereunder and may not
be relied upon by any other person other than such parties and their respective
successors and assigns without the express written consent of
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the undersigned. The opinions expressed in this letter are limited to the
matter set forth in this letter, and no other opinions should be inferred
beyond the matters expressly stated.
Very truly yours,
RAY, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
M. ▇▇▇▇ ▇▇▇▇▇▇
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Distribution List
NationsBank, N.A., as the Agent, a Holder and a Lender
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as additional Holders
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as additional Lenders
Veritas Software Corporation, as the Construction Agent and the Lessee
The various parties to the Participation Agreement from time to time, as the
Guarantors.
First Security Bank, National Association, not individually, but solely as the
Owner Trustee under the VS Trust 1999-1.
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EXHIBIT H
[In-House and Outside Counsel Opinion for the Lessee]
(Pursuant to Section 5.3(ee) of the Participation Agreement)
[Form of In-House Counsel Opinion for the Lessee]
April , 1999
TO THOSE ON THE ATTACHED DISTRIBUTION LIST
Re: Synthetic Lease Financing Provided in favor of Veritas Software
Corporation
Ladies and Gentlemen:
I have acted as general counsel to Veritas Software Corporation, a Delaware
corporation (the "Lessee") in connection with certain transactions contemplated
by the Participation Agreement dated as of April , 1999 (the "Participation
Agreement"), among the Lessee, the various parties thereto from time to time as
guarantors (the "Guarantors"), First Security Bank, National Association, as the
Owner Trustee (the "Owner Trustee"), the various banks and other lending
institutions which are parties thereto from time to time, as holders (the
"Holders"), the various banks and other lending institutions which are parties
thereto from time to time, as lenders (the "Lenders") and NationsBank, N.A., as
the agent for the Lenders and respecting the Security Documents, as the agent
for the Lenders and the Holders, to the extent of their interests (the "Agent").
This opinion is delivered pursuant to Section 5.3(ee) of the Participation
Agreement. All capitalized terms used herein, and not otherwise defined herein,
shall have the meanings assigned thereto in Appendix A to the Participation
Agreement.
In connection with the foregoing, I have examined originals, or copies
certified to my satisfaction, of such corporate documents and records of the
Lessee, certificates of public officials and representatives of the Lessee as
to certain factual matters, and such other instruments and documents which I
have deemed necessary or advisable to examine for the purpose of this opinion.
With respect to such examination, I have assumed (i) the statements of fact
made in all such certificates, documents and instruments are true, accurate and
complete; (ii) the genuineness of all signatures (other than the signatures of
persons signing on behalf of the Lessee) and (iii) the authenticity and
completeness of all documents, certificates, instruments, records and corporate
records submitted to us as originals and the conformity to the original
instruments of all documents submitted to us as copies, and the authenticity
and completeness of the originals of such copies.
Based on the foregoing, and having due regard for such legal
considerations as I deem relevant, and subject to the limitations and
assumptions set forth herein, I am of the opinion that:
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1. Lessee has the corporate power and authority to conduct its business
as presently conducted.
2. Lessee (i) is not subject to, or is exempt from, regulation under (A)
the Federal Power Act, the Public Utility Holding Company Act of 1935 or other
federal or state laws and regulations applicable to public utilities. (B) any
federal or state laws and regulations applicable to banks, finance companies
and other financial institutions, or (C) any other federal or state laws and
regulations limiting Lessee's ability to borrow money; and (ii) is not an
investment company or a company controlled by an investment company, within the
meaning of the Investment Company Act of 1940.
This opinion is limited to the matters stated herein and no opinion is implied
or may be inferred beyond the matters stated herein. This opinion is based on
and is limited to the laws of the State of California and the federal laws of
the United States of America. Insofar as the foregoing opinion relates to
matters of law other than the foregoing, no opinion is hereby given.
This opinion is for the sole benefit of the addressees and their respective
successors and assigns and may not be relied upon by any other person other
than such parties and their respective successors and assigns without the
express written consent of the undersigned. The opinions expressed herein are
as of the date hereof and I make no undertaking to amend or supplement such
opinions if facts come to my attention or changes in the current law of the
jurisdictions mentioned herein occur which could affect such opinions.
Very truly yours,
▇▇▇ ▇▇▇▇▇
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Distribution List
First Security Bank, National Association, individually, and as the Lessor, the
Borrower and the Owner Trustee
NationsBank, N.A., as the Agent, a Lender and a Holder
Comerica Bank--California, as a Lender
Key Bank National Association, as a Lender and a Holder
Fleet National Bank, as a Lender and a Holder
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[▇▇▇▇▇▇▇ ▇▇▇▇ AND ▇▇▇▇ INTERNATIONAL LETTERHEAD]
April 23, 1999
To Each of the Parties Listed
on Schedule A Attached Hereto
Re: Veritas Software Corporation Synthetic Leasing Financing
Ladies and Gentlemen:
We have acted as special counsel to Veritas Software Corporation, a
Delaware corporation doing business in California as Veritas Storage Management
Corp. ("LESSEE"), in connection with the execution and delivery of the documents
listed below, each dated the date hereof unless otherwise specified below,
related to the funding on the date hereof of a synthetic lease (off-balance
sheet) financing in the total funded amount of $72,000,000 for the acquisition
of certain land and improvements and the development of corporate facilities to
be located in Mountain View, California (the "TRANSACTION").
For purposes of this opinion, we have examined the following documents:
1. Master Lease Agreement by and between First Security Bank, National
Association, a national banking association, not in its individual
capacity, but solely as Trustee of the VS Trust 1999-1 ("LESSOR"), and
Lessee (the "LEASE");
2. Participation Agreement by and among the Lessee, Lessor, the holders of
Certificates issued with respect to the VS Trust 1999-1 (the "HOLDERS"),
the lenders party thereto ("LENDERS"), and Nationsbank, N.A., as agent for
the Lenders and the Holders ("AGENT") (the "PARTICIPATION AGREEMENT");
3. Agency Agreement between Lessor and Lessee;
4. Trust Agreement between the Holders and Lessor;
5. Credit Agreement between the Lenders, Lessor and Agent;
6. The Tranche A Notes and the Tranche B Notes;
7. Security Agreement between Lessor and Agent, as accepted and agreed to by
Lessee;
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To Each of the Parties April 23, 1999
Listed on Schedule A Page 2
Attached Hereto
8. Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing
by Lessor, as grantor, to Chicago Title Company, as trustee ("TRUSTEE"), in
favor of Agent, for the benefit of the Lenders and the Holders (the "LENDER
DEED OF TRUST") and that certain Joinder of Lessee thereto, whereby Lessee
is joined as an additional guarantor of its interest in the leasehold
estate encumbered by the Lender Deed of Trust (the "JOINDER OF LESSEE").
9. Memorandum of Lease Agreement and Lease Supplement No. 1 and Deed of Trust
between Lessor, Lessee and Trustee (the "LAND LEASE SUPPLEMENT") and
Memorandum of Lease Agreement and Lease Supplement No. 2 and Deed of Trust
between Lessor, Lessee and Trustee (the "IMPROVEMENTS LEASE SUPPLEMENT")
(the Land Lease Supplement and the Improvements Lease Supplement are
together referred to herein as the "LESSOR DEED OF TRUST");
10. Lease Supplement No. 1 between Lessee and Lessor and Lease Supplement No. 2
between Lessee and Lessor (each a "LEASE SUPPLEMENT");
11. (a) a UCC-1 financing statement to be filed with the California
Secretary of State executed by Veritas Software Corporation ("VERITAS"), as
debtor, and a UCC-1 financing statement to be filed with the California
Secretary of State executed by Veritas Storage Management Corp. ("VSMC"),
as debtor, each in favor of Agent, as secured party relating to the
Collateral encumbered by such a security interest as arises under the
Security Agreement (collectively, the "LESSEE SECURITY AGREEMENT FINANCING
STATEMENTS");
(b) a UCC-1 financing statement to be filed with the California
Secretary of State executed by Lessor, as debtor, in favor of Agent, as
secured party relating to the Collateral encumbered by such a security
interest as arises under the Security Agreement (the "LESSOR SECURITY
AGREEMENT FINANCING STATEMENT") (the Lessee Security Agreement Financing
Statements and the Lessor Security Agreement Financing Statement are
collectively referred to herein as the "SECURITY AGREEMENT FINANCING
STATEMENTS");
(c) a UCC-1 financing statement to be filed with the California
Secretary of State executed by Veritas, as debtor, and a UCC-1 financing
statement to be filed with the California Secretary of State executed by
VSMC, as debtor, each in favor of Agent, as secured party, relating to the
Collateral encumbered by such a security interest as arises under the
Joinder of Lessee (collectively, the "LESSEE DEED OF TRUST FINANCING
STATEMENTS");
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To Each of the Parties April 23, 1999
Listed on Schedule A Page 3
Attached Hereto
(d) a UCC-1 financing statement to be filed with the California
Secretary of State executed by Lessor, as debtor, in favor of Agent, as
secured party, relating to the Collateral encumbered by such a security
interest as arises under the Lender Deed of Trust (the "LESSOR DEED OF
TRUST FINANCING STATEMENT") (the Lessee Deed of Trust Financing Statements
and the Lessor Deed of Trust Financing Statement are collectively referred
to herein as the "DEED OF TRUST FINANCING STATEMENTS");
(e) a UCC-1 financing statement to be filed with the California
Secretary of State executed by Veritas, as debtor, and a UCC-1 financing
statement to be filed with the California Secretary of State executed by
VSMC, as debtor, each in favor of Lessor, as secured party, relating to
the Collateral encumbered by such a security interest as arises under the
Lessor Deed of Trust (collectively, the "LEASE FINANCING STATEMENTS")
(collectively with (a), (b), (c) and (d), the "FINANCING STATEMENTS" with
each a "FINANCING STATEMENT");
13. Agreement of Purchase and Sale dated as of March 29, 1999 by and between
▇▇▇▇▇▇▇▇▇ Semiconductor Corporation of California (the "SELLER") and
Lessee, as amended (the "PURCHASE AGREEMENT");
14. Fixture filings to be recorded in the Official Records of Santa ▇▇▇▇▇
County, California, executed by Lessor, as debtor, and fixture filings to
be recorded in the Official Records of Santa ▇▇▇▇▇ County, California,
executed by Lessee, as debtor (collectively, the "FIXTURE FILINGS);
15. Assignment of Purchase Agreement between Lessor and Lessee (the
"ASSIGNMENT");
16. Grant Deed from Seller to Lessor (the "DEED");
17. Sublease Agreement between Lessee, as sublessor, and Seller, as sublessee
(the "SUBLEASE");
18. Collateral Assignment of Sublease by Lessee in favor of Agent (the
"COLLATERAL ASSIGNMENT"); and
19. Subordination, Non-Disturbance and Attornment Agreement between Lessee,
Lessor and Agent (the "SNDA").
The documents listed above as documents 2-6 are collectively referred
to herein as the "LOAN DOCUMENTS" and the documents listed above as documents
7-13 are collectively referred to herein as the "SECURITY DOCUMENTS." Together,
the Lease, the Loan Documents, the
129
To Each of the Parties April 23, 1999
Listed on Schedule A Page 4
Attached Hereto
Security Documents and the documents listed above as documents 14-18 are
collectively referred to herein as the "OPERATIVE DOCUMENTS." This opinion is
being delivered to you pursuant to Section 5.3(ee) of the Participation
Agreement. The Agent, Lenders and Holders are sometimes collectively referred
to herein as the "LENDER PARTIES." Unless otherwise defined herein, capitalized
terms used and not defined herein shall have the meanings given to them in
Appendix A of the Participation Agreement.
For purposes of this opinion, we have examined the following documents:
1. Executed copies of the Operative Documents;
2. An executed copy of the Certificate of Lessee ("CERTIFICATE OF
LESSEE"), executed by ▇▇▇ ▇. ▇▇▇▇▇, the Secretary of Lessee, for the benefit of
the undersigned, dated April 23, 1999 a copy of which is attached hereto as
Exhibit A;
3. A copy of the Certificate of Incorporation of Lessee, certified by the
Delaware Secretary of State on April 13, 1999 and further certified as current
by the Secretary of Lessee on April 23, 1999 ("LESSEE CERTIFICATE OF
INCORPORATION");
4. A copy of the Bylaws of Lessee, certified as current by the Secretary
of Lessee on April 23, 1999 ("LESSEE BYLAWS");
5. A Certificate of Good Standing for Lessee, issued on April 13, 1999 by
the Secretary of State of the State of Delaware;
6. A Certificate of Good Standing (Foreign Corporation) for Lessee, issued
on April 14, 1999 by the Secretary of State of the State of California; and
7. A copy of the Unanimous Written Consent by the Board of Directors of
the Lessee, on March 25, 1999, certified by the Secretary of Lessee on April
23, 1999.
The documents listed above as documents 3, 4 and 7 are collectively
referred to herein as the "CONSTITUENT DOCUMENTS."
We represent Lessee only with respect to specific matters and our
relationship with Lessee is such that we have no detailed or continuing
familiarity with any of its day-to-day operations, business or financial
affairs. Although attorneys in our firm have been involved in the governmental
approval process for the Property, we have made no independent review of that
process, nor have we made any physical inspection of the Property, nor have we
undertaken independent investigation respecting any fire or public health laws
or compliance with the regulations of any insurance company. Our opinion is
based exclusively upon a review of the
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To Each of the Parties April 23, 1999
Listed on Schedule A Page 5
Attached Hereto
Operative Documents, the Constituent Documents, the Certificate of Lessee and
the Certificates of the Secretaries of State referred to above, (and for
purposes of our opinion in Paragraph 3 below, any Material Agreements identified
in the Certificate of Lessee). In addition, we have relied upon the
representations and warranties of Lessee set forth in the Certificate of Lessee
with respect to the factual determinations underlying the legal conclusions set
forth herein.
Whenever any opinion expressed herein with respect to the existence or
absence of facts is qualified by the phrase "to our current actual knowledge,"
such knowledge is limited solely to (i) the representations of Lessee set forth
in the Certificate of Lessee and the Operative Documents, (ii) an examination of
documents in those of our files solely related to the Transaction and (iii) the
actual knowledge of those attorneys in our firm who have substantively
represented Lessee with respect to the Transaction (but not including any
constructive or imputed notice of any information) or who have had an active
involvement in the preparation of this opinion ("Primary Lawyer Group"). We have
not attempted to verify independently the representations of Lessee; and we have
not conducted any investigation, nor do we intend to undertake for purposes of
this opinion any investigation, of any facts that may be ascertained by the
examination of all of the other files or attorneys of our firm or any court
files or third parties.
In our examination and review we have assumed the genuineness of all
signatures other than the officers of Lessee, the legal capacity of natural
persons, the authenticity of the documents submitted to us as originals, the
conformity to the original documents of all documents submitted to us as
certified, facsimile or photostatic copies, and the authenticity of the
originals of such copies.
The law covered by the opinions expressed herein is limited to the federal
law of the United States and the General Corporation Law of the State of
Delaware, the laws of the State of New York and the laws of the State of
California, in each case as expressly provided below. We express no opinion with
respect to the effect or applicability of the laws of any other jurisdiction.
For purposes of our opinions expressed in Paragraph 1 below, with respect
to due incorporation, valid existence and good standing of Lessee, we are
relying solely on our review and examination of the certificates received from
the Secretary of State of the State of Delaware, and the Secretary of State of
the State of California, without further investigation of the corporate records
of Lessee. Our opinions expressed in Paragraphs 1 and 2 below relate solely to
the laws of the State of California, the General Corporation Law of the State of
Delaware, and applicable federal laws of the United States, and we express no
opinion in Paragraphs 1 and 2 below with respect to the effect or applicability
of the laws of any other jurisdiction.
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To Each of the Parties April 23, 1999
Listed on Schedule A Page 6
Attached Hereto
Our opinions expressed in clauses (ii) and (iii) of Paragraph 3 below are
limited to laws and regulations normally applicable to transactions of the type
contemplated in the Operative Documents and do not extend to licenses, permits
and approvals necessary for the development of the Property or the conduct of
Lessee's business.
Our opinions expressed in Paragraphs 4(a) and 9(a) below relate solely to
the laws of the State of New York (and, in the case of Paragraph 9(a) insofar as
matters of California law are relevant to the opinions relating to perfection
expressed therein, the laws of the State of California), and we express no
opinion in Paragraphs 4(a) and 9(a) below with respect to the effect or
applicability of the laws of any other jurisdiction. Such opinion is limited to
laws and regulations normally applicable to transactions of the type
contemplated in the Operative Documents and do not extend to licenses, permits
and approvals necessary for the conduct of Lessee's business. We have made no
investigation of New York law with respect to the creation of any leasehold
estate, with respect to the creation, perfection or priority of any real estate
lien or security interest in real property, or with respect to the exercise of
any remedies relating to any leasehold estate, real estate lien or security
interest in real property, nor have we consulted with counsel admitted to
practice law in the State of New York regarding such matters, and we express no
opinion herein relating to New York law with respect to any such matters.
Our opinions expressed in Paragraphs 4(b), 6, 7, 8, 9(b), 10, 11, 12 and 13
below relate solely to the laws of the State of California (except for the
opinions expressed in Paragraph 11 below which also relate to the federal laws
of the United States), and we express no opinion in Paragraphs 4(b), 6, 7, 8,
9(b), 10, 11, 12 and 13 below with respect to the effect or applicability of the
laws of any other jurisdiction (except as expressly set forth in this sentence).
Such opinions are limited to laws and regulations normally applicable to
transactions involving California real property interests as contemplated in the
Operative Documents. We invite your attention to the fact that the Operative
Documents state that they are governed by the law of the State of New York. We
have not, for purposes of our opinions expressed in Paragraphs 4(b), 6, 7, 8,
9(b), 10, 11, 12 and 13 examined the question of, and express no opinion as to,
what law would govern the interpretation, characterization or enforcement of the
Operative Documents, and our opinions with regard to the Operative Documents in
Paragraphs 4(b), 6, 7, 8, 9(b), 10, 11, 12 and 13 respectively, are based on the
assumption that the internal law of the State of California would govern the
provisions thereof, and in addition, in the case of Paragraphs 6 and 7, upon the
assumptions set forth therein, respectively.
Insofar as our opinion expressed in Paragraph 13 below concerns the law of
the State of California limiting the rates of interest legally chargeable or
collectible, we have relied upon our understanding that each of the Lender
Parties (as defined below) is a subsidiary of a bank holding company or is a
bank organized under the laws of the United States or any State thereof and, as
a result thereof, is exempt from the restrictions of Section 1 of Article XV of
the
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To Each of the Parties
Listed on Schedule A April 23, 1999
Attached Hereto Page 7
Constitution of the State of California relating to rates of interest upon the
loan of money. We further assume in this regard that all Advances have been and
will be made by each of the Lender Parties for its own account and without
intent to circumvent otherwise applicable interest rate limitations under
California law and that there is no present express or implied agreement or
plan to sell participations or any other interest in the Operative Documents to
any Person other than a Person that also qualifies for an exemption from the
interest rate limitations of California law.
In addition and without limiting the previous six paragraphs, we express
no opinion herein with respect to the effect of any pension, employee benefit
or tax laws (except as provided in Paragraph 10 below), or any zoning or
similar land use law, any state or federal antitrust law, state or federal
securities laws. Further, we express no opinion as to compliance or
noncompliance by Lessor, Agent, Holders or Lenders with any federal, state or
other law (i) requiring any of Lessor, Agent, Holders or Lenders to be licensed
as a bank, finance company or other type of financial institution, (ii)
pertaining to matters regulating the assets held by the Lenders on the basis of
portfolio requirements or Lessor's, Agent's, Holders' or Lenders'
capitalization, such as loan limits and capital adequacy requirements, and
(iii) otherwise applicable to Lessor, Agent, Holders or Lenders and relating to
their legal or regulatory status or the nature of their business.
In rendering this opinion, with your permission and without independent
investigation (unless otherwise noted), we are making and relying on the
following assumptions:
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To Each of the Parties April 23, 1999
Listed on Schedule A Page 8
Attached Hereto
A. THERE ARE NO DOCUMENTS OR AGREEMENTS THAT WOULD MODIFY OR CONFLICT WITH THE
OPERATIVE DOCUMENTS, BETWEEN OR AMONG ANY OF THE PARTIES THERETO AND/OR ANY
OTHER PERSON OR ENTITY ("Person");
B. EACH OF LESSOR, AGENT, EACH HOLDER AND EACH LENDER IS DULY ORGANIZED, VALIDLY
EXISTING AND IN GOOD STANDING UNDER THE LAWS OF ITS RESPECTIVE JURISDICTION OF
FORMATION AND ANY OTHER RELEVANT JURISDICTION, AND HAS ALL REQUISITE POWER AND
AUTHORITY TO CARRY ON ITS BUSINESS AS NOW CONDUCTED, TO ENTER INTO THE OPERATIVE
DOCUMENTS TO WHICH IT IS A PARTY AND TO CARRY OUT THE TERMS AND TO EXERCISE THE
REMEDIES OF THE OPERATIVE DOCUMENTS TO WHICH IT IS A PARTY;
C. ALL OF THE OPERATIVE DOCUMENTS TO WHICH THEY ARE PARTIES, RESPECTIVELY, HAVE
BEEN DULY AUTHORIZED, EXECUTED AND DELIVERED BY LESSOR, AGENT, EACH HOLDER AND
EACH LENDER, AND ALL THE OPERATIVE DOCUMENTS TO WHICH THEY ARE PARTIES,
RESPECTIVELY, ARE LEGAL, VALID, BINDING AND ENFORCEABLE AS TO LESSOR (EXCEPT FOR
PURPOSES OF OUR OPINIONS IN PARAGRAPHS 4, 8 AND 9 BELOW AS SET FORTH IN SUCH
OPINIONS), AGENT, EACH HOLDER AND EACH LENDER; AND
▇. ▇▇▇▇▇▇, AGENT, EACH HOLDER AND EACH LENDER HAS FILED ANY REQUIRED CALIFORNIA
AND NEW YORK STATE FRANCHISE, INCOME OR SIMILAR TAX RETURNS AND HAS PAID ANY
REQUIRED CALIFORNIA AND NEW YORK STATE FRANCHISE, INCOME OR SIMILAR TAXES.
Based upon the foregoing and our reliance thereon and having regard for
legal considerations which we deem relevant, we are of the opinion that:
1. Lessee is a duly incorporated and validly existing corporation in good
standing under the laws of the State of Delaware, is in good standing as a
foreign corporation in the State of California and has the corporate power and
authority to enter into and perform its obligations under the Operative
Documents to which it is or is to be a party and each other agreement,
instrument and document to be executed and delivered by it in connection with
the transactions contemplated by the Operative Documents.
2. Lessee has taken all necessary corporate action to authorize the
execution, delivery and performance of the Operative Documents to which it is a
party and has duly executed and delivered each Operative Document to which it is
a party.
3. The execution and delivery by Lessee of the Operative Documents to which
it is a party and compliance by Lessee with the material provisions thereto, do
not and will not (i) violate or conflict with the Lessee Certificate of
Incorporation or the Lessee Bylaws, (ii) to our current actual knowledge,
conflict with, or require any consents, authorizations, registrations,
declarations or filings (except as may relate to the perfection of liens or
security interests) by Lessee under, the laws of any state having applicability
to Lessee, as presently in effect and interpreted, or any order of any
Governmental Authority applicable to or binding on Lessee, (iii) conflict with,
or require any consents, authorizations, registrations, declarations or
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filings (except as may relate to the perfection of liens or security interests)
by Lessee, or any stockholders, or any trustee or holder of indebtedness, of
the Lessee (except for such approvals and consents which have been already
obtained), under the laws of the State of California or, to our current actual
knowledge, the State of New York having applicability to Lessee, in each case
as presently in effect and interpreted, (iv) to our current actual knowledge,
conflict with or constitute a violation of any court orders, writs, judgments
or decrees of any court, or any arbitrator or governmental agency or authority,
(v) constitute a material breach of any Material Agreement (as defined in the
Certificate of Lessee) to which Lessee is a party or by which Lessee is bound
or, to our current actual knowledge, any other agreement or instrument to which
Lessee is a party or by which Lessee or any of its properties may be bound or
affected, or (vi) result in the creation of any Lien (other than Permitted
Liens and Lessor Liens) upon the Property under the express terms of the Lessee
Certificate of Incorporation, the Lessee Bylaws or, to our current actual
knowledge, any other agreement or instrument to which Lessee is a party or by
which any of its properties may be bound or affected.
4. (a) Under the laws of the State of New York, the Operative Documents
(other than the Lease) to which Lessee and/or Lessor is a party constitute the
legal, valid and binding obligation of Lessee, enforceable against Lessee and
the Lessor in accordance with their terms.
(b) Under the laws of the State of California, the Operative
Documents (other than the Lease) to which Lessee and/or Lessor is a party
constitute the legal, valid and binding obligation of Lessee, enforceable
against Lessee and Lessor in accordance with their terms.
5. We have no current actual knowledge of any pending or threatened
actions, suits, litigation or other proceedings against Lessee or the Property
before any court, arbitrator or Governmental Authority that question or
challenge the legality, validity or enforceability of the Operative Documents
or the Transaction, that concern the Property or the Lessee's interest therein
or which, if determined adversely to Lessee, would be likely to have a Material
Adverse Effect (as defined in the Certificate of Lessee) on Lessee.
6. Assuming that the Transaction, insofar as the Lease is concerned, is
recharacterized by a court of competent jurisdiction as a loan from Lessor or
Lessee, (i) the Lease constitutes a legally valid and binding obligation of
Lessee, enforceable against Lessee in accordance with its terms, and (ii)
Lessee's obligations to make the payments characterized as "Basic Rent" and
"Supplemental Rent" under the Lease will entitle Lessor to pursue its rights
and remedies under the Loan Documents against the Collateral covered thereby
upon a material breach of such obligations (provided, however, we express no
opinion as to the nature or characterization of such payments as "Basic Rent"
or "Supplemental Rent" or otherwise).
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7. Assuming that the Transaction, insofar as the Lease is concerned, is
characterized by a court of competent jurisdiction as an operating lease between
Lessor and Lessee, (i) the Lease constitutes a legally valid and binding
obligation of Lessee, enforceable against Lessee in accordance with its terms,
(ii) the Lease and the applicable Lease Supplement are in a form sufficient to
demise to Lessee a valid leasehold interest in the Property described in such
Lease Supplement and (iii) the Lessee's obligations to make the payments
characterized as "Basic Rent" and "Supplemental Rent" under the Lease are
enforceable; provided, however, we express no opinion as to the nature or
characterization of such payments as "Basic Rent" or "Supplemental Rent" or
otherwise; and further provided that we express no opinion as to the
enforceability of the Lease remedies obligating Lessee to pay the Termination
Value or any other amount in excess of accrued and unpaid "Basic Rent,"
including, but not limited to, the availability to Lessor of any rights or
remedies under the Lease with respect to payments of "Supplemental Rent", where
a court of competent jurisdiction has not recharacterized the Transaction,
insofar as the Lease is concerned, as a loan from Lessor to Lessee.
8. The Deed, the Lender Deed of Trust (and the Joinder of Lessee attached
thereto), the Lessor Deed of Trust, the Collateral Assignment and the Fixture
Filings are each in a form sufficient for recording in the Official Records of
Santa ▇▇▇▇▇ County. Upon proper recording in the Official Records in Santa ▇▇▇▇▇
County and the payment of all fees required in connection therewith the Lender
Deed of Trust, the Joinder of Lessee, the Collateral Assignment and the Fixture
Filings related thereto will create in favor of the Agent a valid and
enforceable record lien on and security interest in the Lessee's and Lessor's
interests in the Collateral described therein. Upon proper recording in the
Official Records in Santa ▇▇▇▇▇ County and the payment of all fees required in
connection therewith the Lessor Deed of Trust and the Fixture Filings related
thereto will create in favor of the Lessor a valid and enforceable record lien
on and security interest in the Lessee's interests in the Collateral described
therein. No other recordations or filings are necessary in order to provide such
constructive notice of the lien of the Lender Deed of Trust or the Lessor Deed
of Trust with respect to the real property described therein.
9. (a)(i) Under the laws of the State of New York, the Security Agreement
creates in favor of the Agent, for the benefit of the secured parties named
therein, a security interest in the Collateral described therein to which
Article 9 of the New York Uniform Commercial Code ("NYUCC") is applicable (the
"ARTICLE 9 COLLATERAL"). The Security Agreement Financing Statements are in
appropriate form for filing with the California Secretary of State. Upon the
filing of the Security Agreement Financing Statements with the California
Secretary of State, the Agent, as secured party, will have a perfected security
interest in that portion of the Article 9 Collateral in which a security
interest is perfected by the filing of a financing statement with the California
Secretary of State under the NYUCC and Division 9 of
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the California Uniform Commercial Code (the "CUCC"). Upon proper filing of the
Security Agreement Financing Statements pursuant to the filing system
established under applicable California law, no other action is necessary under
the NYUCC to perfect such security interests in the Article 9 Collateral.
(ii) Under the laws of the State of New York, the security interests in
the Collateral described in the Deed of Trust Financing Statements and the
Lease Financing Statements will be perfected upon the proper filing of the Deed
of Trust Financing Statements and the Lease Financing Statements covering such
Collateral with the California Secretary of State. Upon proper filing of the
Deed of Trust Financing Statements and the Lease Financing Statements pursuant
to the filing system established under applicable California law, no other
action is necessary under the NYUCC to perfect the security interests in the
Collateral described in the Deed of Trust Financing Statements and the Lease
Financing Statements.
(b)(i) Under the laws of the State of California, the Security Agreement
creates in favor of the Agent, for the benefit of the secured parties named
therein, a security interest in the Article 9 Collateral. The Security
Agreement Financing Statements are in appropriate form for filing with the
California Secretary of State. Upon the filing of the Security Agreement
Financing Statements with the California Secretary of State, the Agent, as
secured party, will have a perfected security interest in that portion of the
Article 9 Collateral in which a security interest is perfected by the filing of
a financing statement with the California Secretary of State under Division 9
of the CUCC. Upon proper filing of the Security Agreement Financing Statements
pursuant to the filing system established under applicable California law, no
other action is necessary under the CUCC to perfect such security interests in
the Article 9 Collateral.
(ii) Under the laws of the State of California, the security interests
in the Collateral described in the Deed of Trust Financing Statements and the
Lease Financing Statements will be perfected upon the proper filing of the Deed
of Trust Financing Statements and the Lease Financing Statements covering such
Collateral with the California Secretary of State. Upon proper filing of the
Deed of Trust Financing Statements and the Lease Financing Statements pursuant
to the filing system established under applicable California law, no other
action is necessary under the CUCC to perfect the security interests in the
Collateral described in the Deed of Trust Financing Statements and the Lease
Financing Statements.
10. There are no mortgage taxes or filing fees payable to any public
body solely in connection with the recording of the Lender Deed of Trust, the
Lessor Deed of Trust or the Fixture Filings in the Official Records of Santa
▇▇▇▇▇ County except filing fees payable to the County Recorder of Santa ▇▇▇▇▇
County.
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11. No Governmental Action by, and no notice to or filing with, any
Governmental Authority is required for the acquisition of the Property by
Lessee or, to our current actual knowledge, Lessor.
12. To our current actual knowledge, title to the Properties located in
the State of California may be held in the name of the Lessor.
13. The Transaction and, particularly, Lessee's obligations to make
payments of "Basic Rent" and "Supplemental Rent" will not violate the usury
laws of the State of California.
The opinions expressed herein with respect to the laws of the State of New
York are subject to and limited by the following qualifications, assumptions,
limitations and exceptions:
(a) The enforceability of Lessee's and Lessor's obligations under the
Operative Documents may be subject to or limited by (i) bankruptcy, insolvency,
reorganization, arrangement, moratorium, fraudulent transfer and other similar
laws affecting the rights of creditors generally; and (ii) general equitable
principles (whether relief is sought in a proceeding at law or in equity),
including, without limitation, concepts of materiality, reasonableness, good
faith, and fair dealing.
(b) We express no opinion as to provisions of the Operative Documents
purporting to establish an evidentiary standard or to authorize conclusive
determinations by the Agent, Lenders, Holders or Lessor (collectively, "Lender
Parties") or any other Person or allowing the Lender Parties or any other
Person to make determinations in its sole discretion.
(c) We also express no opinion as to:
(i) the enforceability of provisions of the Operative Documents pursuant to
which Lessee or Lessor agrees to make payments without set-off, defense or
counterclaim;
(ii) the enforceability of provisions relating to indemnification,
contribution or exculpation, to the extent any such provision is contrary to
public policy or prohibited by law (including, without limitation, federal and
state securities laws);
(iii) any provision providing for the exclusive jurisdiction of a particular
court or purporting to waive rights to trial by jury, service of process or
objections to the laying of venue or to forum on the basis of forum non
conveniens, in connection with any litigation arising out of or pertaining to
the Operative Documents;
(iv) provisions contained in the Operative Documents purporting to waive
either illegality as a defense to the performance of contract obligations or
any other defense to such performance which cannot, as a matter of law, be
effectively waived;
(v) any provision of the Operative Documents insofar as it provides that any
Person purchasing a participation from any Lender Party or other Person may
exercise set-off or
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similar rights with respect to such participation or that any Lender Party or
other Person may exercise set-off or similar rights other than in accordance
with applicable law;
(vi) any provision of the Operative Documents permitting modification
thereof only by means of an agreement in writing signed by the parties thereto;
(vii) any provision of the Operative Documents requiring payment of
attorneys' fees, except to the extent a court determines such fees to be
reasonable;
(viii) the effect of the law of any jurisdiction other than the State of New
York which limits the rates of interest legally chargeable or collectible;
(ix) any provisions purporting to exclude conflict of law principles under
New York law or otherwise select the laws of New York to govern any of the
Operative Documents or any security interest;
(x) any provision purporting to waive any right to claim punitive damages;
(xi) any provision providing for arbitration of disputes; and
(xii) any Collateral which is an accession to, or commingled or processed
with, other goods to the extent that the security interest of the Lender
Parties is limited by Section 9-314 or 9-315 of the NYUCC or Section 9314 or
9315 of the CUCC.
(d) The enforceability of any provisions of the Operative Documents which
are deemed to constitute a subordination of the rights of Lessee or Lessor may
be limited by exoneration and other defenses similar to those that may be
asserted by any guarantor.
(e) The enforceability of certain remedial and other provisions of the
Security Documents, including, without limitation, certain of the waivers
therein, may be limited by applicable state and federal laws (including
judicial decisions), but such laws do not, in our opinion (subject to the
limitations, qualifications and assumptions expressed herein), render any
Security Document, taken as a whole, invalid or unenforceable, and each of the
Security Documents, taken as a whole, contains adequate provisions for the
practical realization by the Lender Parties of the material rights and benefits
afforded thereby.
(f) The effectiveness of any Financing Statement will lapse five years
from the date the same if filed unless a continuation statement is filed within
six months prior to the expiration of that five year period.
(g) Under the NYUCC and CUCC events occurring subsequent to the date
hereof may affect any security interest subject to the NYUCC and CUCC. Without
limiting the generality of the foregoing, to the extent provided by Article 9 of
the NYUCC and Division 9 of the CUCC, additional filings with respect to the
Collateral may be necessary to continue perfection of all or certain of the
Collateral if (i) Lessee or Lessor changes its name (or any of the Financing
Statements otherwise becomes seriously misleading), (ii) any item of Collateral
located in California is removed from that state or (iii) Lessee or Lessor
changes the jurisdiction in which its chief executive office is located to a
jurisdiction other than California.
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(h) To the extent that any of the Collateral consists of or constitutes
"proceeds" (as such term is defined in sec. 9-306 of the NYUCC), the security
interest therein is limited and conditioned as set forth in such Section.
(i) The opinions expressed herein with respect to the creation, attachment or
perfection of any security interest: (i) are limited to the opinions expressed
in Paragraphs 9(a)(i) and (ii) above and to the Collateral specifically
described in the Security Agreement, the Joinder of Lessee, the Lessor Deed of
Trust and Lender Deed of Trust, respectively, which is governed by relevant
provisions as currently in effect of Article 9 of the NYUCC (for purposes of
this paragraph only, the "Covered Collateral"); (ii) do not apply to Collateral
requiring perfection procedures other than the filing of a financing statement
in the office of the California Secretary of State; and (iii) by reason of the
operation of Section 9-103 of the NYUCC, are limited as to our perfection
opinions in Paragraphs 9(a)(i) and (ii)(insofar as such opinion governs goods
and such other items of the Covered Collateral described in Section 9-103(1)(a)
of the NYUCC) to goods and such other items located in the State of California.
We express no opinion with respect to the priority of any security interest. We
have assumed for purposes of the opinions in Paragraphs 9(a)(i) and (ii) above
that the Lessee and Lessor are located in California for purposes of sec.
9-103(3)(b) and sec. 9-103(6)(f) of the NYUCC. We have also assumed for purposes
of such opinions that Lessee and Lessor have rights in the Covered Collateral
within the meaning of the NYUCC and the CUCC, that all required consents of
third parties to the grant of security interests in the Covered Collateral have
been obtained and that the Lender Parties (except for Lessor with respect to the
attachment and/or and perfection of Lessor's security interests) have given
"value" within the meaning of the NYUCC and the CUCC. We have assumed for the
purposes of our opinions in Paragraph 9(a)(ii) that the security interests (to
which the Deed of Trust Financing Statements and the Lease Financing Statements,
respectively, pertain) in the Collateral described in the Deed of Trust
Financing Statements in favor of the Agent and in the Collateral described in
the Lease Financing Statements in favor of the Lessor, respectively, have
attached for purposes of the NYUCC and the CUCC.
(j) We also express no opinion as to the title of Lessee or Lessor to any
Collateral or the classification of the Collateral.
(k) We express no opinion (i) with respect to any Collateral of a type
described in Section 9-401(1)(a) or (b) of the NYUCC or Section 9401(1)(a) or
(b) of the CUCC or represented by any certificate of title and (ii) as to the
accuracy or completeness of any description of the Collateral (including the
scope of the term "general intangibles") or the characterization of any
Collateral as real property, personal property, equipment or fixtures.
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The opinions expressed herein with respect to the laws of the State of
California are subject to and limited by the following qualifications,
assumptions, limitations and exceptions:
(a) Our opinions are subject to the effect of the limitations imposed by the
CUCC relating to or affecting the rights and remedies available to secured
creditors.
(l) Our opinions are subject to the effect of judicial decisions which may
permit the introduction of extrinsic evidence to interpret the terms of written
contracts.
(m) The legality, validity, binding nature and enforceability of obligations of
Lessee or Lessor under the Operative Documents may be subject to or limited by
(1) bankruptcy, insolvency, reorganization, arrangement, moratorium, fraudulent
transfer and other similar laws affecting the rights of landlords and of
creditors; (2) general principles of equity (whether relief is sought in a
proceeding at law or in equity), including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing and the discretion of
any court of competent jurisdiction in awarding specific performance or
injunctive relief and other equitable remedies; and (3), without limiting the
generality of the foregoing, in the event that a court applies California law
when interpreting any Operative Document, the effect of California court
decisions and statutes which indicate that provisions of any Operative Document
which permit any Lender Party or any other Person to take action or make
determinations may be subject to a requirement that such action be taken or
such determinations be made on a reasonable basis in good faith or that it be
shown that such action is reasonably necessary for the protection of such Lender
Party or such other Person.
(n) With respect to our opinion above concerning enforcement of the assignment
of rents set forth in any of the Operative Documents, we note the limitations
and requirements with respect to the enforcement thereof set forth in Section
2938 of the California Civil Code ("CC").
(o) With respect to the opinions set forth above, we note that if any of the
obligations of Lessee under the Lease or any Operative Document relating thereto
are determined by a court applying California law to be obligations that are
secured by a deed of trust or mortgage on the real property covered thereby of
which is located in the State of California, such obligations may be affected by
the California antideficiency, one-action and related laws, and laws relating to
default cure rights, including, without limitation, the following:
(i) Section 726 of the California Code of Civil Procedure ("CCP") provides that
any action to recover on a debt or other right secured by a mortgage or a deed
of trust on real property must comply with the requirements of that section,
which requirements relate to and specify the procedures for the sale of
encumbered property, the application of proceeds, the rendition in certain cases
of a deficiency judgment and other related matters. In such an
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action or proceeding, the debtor may require the creditor to exhaust all of its
security before a personal judgment may be obtained against the debtor for a
deficiency, and failure to comply with the provisions of Section 726 (including
an attempt to exercise a right to set off with respect to any funds of the
debtor that may be deposited with the creditor from time to time) may result in
the creditor's loss of its lien on real property collateral;
(ii) Section 580b of the CCP provides that no deficiency judgment shall be
rendered upon a purchase money obligation in favor of the vendor arising from
the sale of real property where such purchase money obligation is secured by a
lien on the real property purchased from the vendor or in favor of a lender
where the proceeds of the loan are used to purchase a one-to-four family
dwelling occupied entirely or in part by the borrower and where such loan is
secured by a lien on such dwelling;
(iii) Sections 580a and 580d of the CCP, respectively, which (i) limit any
deficiency after judicial foreclosure to the excess of the debt over the fair
market value of the foreclosed property at the time of sale, and (ii) prevent a
deficiency judgment after a nonjudicial or trustee's foreclosure sale pursuant
to a power of sale;
(iv) Section 2924c of the CC provides for certain default cure rights following
acceleration of the maturity of an obligation secured by a deed of trust or
mortgage on real property, which may be exercised at any time within the
reinstatement period described in such Section;
(v) Section 726.5 of the CCP authorizes, under certain circumstances, a real
estate-secured commercial lender to waive its lien against a parcel of
"environmentally impaired" security (as therein defined) and ▇▇▇ the borrower
without foreclosing on the real property collateral for the loan;
(vi) Section 9501 of the CUCC prescribes the rights and remedies of secured
creditors with both real and personal property security;
(vii) CCP Sections 729.010 through 729.090 provide for certain redemption and
other rights following any judicial foreclosure sale;
(viii) Section 736 of the CCP permits a lender, under certain circumstances, to
▇▇▇ for breach of contract relating to any "environmental provisions" (as
therein defined) concerning real property security without foreclosing on the
real property security or in an action brought following foreclosure, whether
judicial or non-judicial; and
(ix) CC Sections 2924, 2924b and 2924c require that certain procedures be
followed by the holder of a deed of trust or mortgage with power of sale before
exercising any power of sale thereunder.
(p) The enforceability of any "environmental provision" of the Operative
Documents is also limited by, and also subject to compliance by the
beneficiaries thereunder with, statutory or other legal requirements, including,
without limitation, CCP Sections 564, 726.5 and 736 and CC Section 2929.5. As
used above, the term "environmental provision" has the meaning set forth in CCP
Section 736(f)(2).
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(q) The effectiveness of the Financing Statements will lapse five years from
the date the same is filed unless a continuation statement is filed within six
months prior to the expiration of that five year period.
(r) To the extent provided by Division 9 of the CUCC, additional filings with
respect to the Collateral may also be necessary to continue perfection of the
security interest in all or certain of the Collateral if Lessee or Lessor
changes its name (or any Financing Statement otherwise becomes seriously
misleading), if any item of Collateral that is located in California is removed
from that State or if Lessee or Lessor changes the jurisdiction in which its
chief executive office is located to a jurisdiction other than California.
(s) To the extent that any of the Collateral consists of or constitutes
"proceeds" (as such term is defined in Section 9306 of the CUCC), the security
interest therein is limited and conditioned as set forth in such Section 9306.
(t) The opinions expressed herein with respect to the creation, attachment or
perfection of any security interest (except to the extent expressly stated in
Paragraph 8 above): (i) are limited to the opinions expressed in Paragraphs
9(b)(i) and (ii) above and to the Collateral specifically described in the
Security Agreement, the Joinder of Lessee, the Lessor Deed of Trust and Lender
Deed of Trust, respectively, which is governed by relevant provisions as
currently in effect of Division 9 of the CUCC (for purposes of this paragraph
only, the "Covered Collateral"); (ii) do not apply to Collateral requiring
perfection procedures other than the filing of a financing statement in the
office of the California Secretary of State; and (iii) by reason of the
operation of Section 9103 of the CUCC, are limited as to our perfection opinions
in Paragraphs 9(a)(i) and (ii)(insofar as such opinion governs goods and such
other items of the Covered Collateral described in Section 9103(1)(a) of the
CUCC) to goods and such other items located in the State of California. We
express no opinion with respect to the priority of any security interest. We
have assumed for purposes of the opinions in Paragraphs 9(b)(i) and (ii) above
that Lessee and Lessor are each located in California for purposes of Section
9103(3)(b) and Section 9103(6)(f) of the CUCC. We have also assumed for purposes
of such opinions that Lessee and Lessor each have rights in the Covered
Collateral within the meaning of the CUCC, that all required consents of third
parties to the grant of security interests in the Covered Collateral have been
obtained and that the Lender Parties (except for Lessor with respect to the
attachment and/or and perfection of Lessor's security interests) have given
"value" within the meaning of the CUCC. We have assumed for the purposes of our
opinions in Paragraph 9(b)(ii) that the security interests (to which the Deed of
Trust Financing Statements and the Lease Financing Statements, respectively,
pertain) in the Collateral described in the Deed of Trust Financing Statements
in favor of the Agent and in the Collateral described in the Lease Financing
Statements in favor of the Lessor, respectively, have attached for purposes of
the CUCC.
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(u) We also express no opinion (i) as to the title of the Lessee or Lessor to
any Collateral or (ii) as to whether the Lease constitutes a security interest
or creates a security interest within the meaning of the CUCC.
(v) We express no opinion (i) with respect to any Collateral of a type
described in Section 9401(1)(a) or (b) of the CUCC or represented by any
certificate of title, (ii) as to the accuracy or completeness of any
description of the Property or any other property or Collateral (including the
scope of the term "general intangibles"), or the characterization of any
Collateral as real property, personal property, equipment or fixtures and (iii)
as to any Collateral which is an accession to, or commingled or processed with,
other goods to the extent that the security interest of the Lender Parties is
limited by Section 9314 or 9315 of the CUCC.
(w) The rights of Lender Parties in respect of fixtures may be limited by CC
Sections 1013, 1013.5 and 1019 and CUCC Section 9313 which concern fixtures and
their removal except to the extent that appropriate agreements are obtained
from owners and encumbrancers of, and others claiming an interest in, the real
property on which such fixtures are located.
(x) We express no opinion as to whether any divisions of real property or any
interests therein contemplated by the Operative Documents comply with the
Subdivision Map Act (as defined in Section 66410 of the California Government
Code) or any city, county or other local rules, ordinances or regulations
promulgated by authority thereof or in connection therewith.
(y) We express no opinion as to the title of the Lessee or the Lessor to the
Property or any Improvements pursuant to the Lease.
(z) We further advise you that if a court of competent jurisdiction applies
the laws of the State of California to a lease of real property located in the
State of California, the obligations of Lessee under the Lease may also be
affected under California law by the provisions of CC Sections 1932 and 1933
(relating, inter alia, to termination of a lease upon casualty to the leasehold
estate) or by Section 1265.130 of the CCP (relating to termination of a lease
upon a taking of the leasehold estate for public use in certain circumstances).
(aa) We express no opinion as to the validity, binding nature or enforceability
of any provisions of the Operative Documents that:
(i) purport to waive regulatory, constitutional, statutory or common law
rights, including the right to receive notice or to be allowed to cure,
reinstate or redeem in the event of default, or that expressly or by
implication waive broadly or vaguely stated rights, unknown future rights and
defenses to obligations, in each case to the extent such rights or defenses are
not waivable under applicable law;
(ii) purport to require the Lessee or Lessor to make payments without set-off,
defense or counterclaim;
(iii) specify the manner of foreclosure or exercise of remedies in respect of
deposit accounts insofar as the CUCC does not address the same;
144
To Each of the Parties April 23, 1999
Listed on Schedule A Page 19
Attached Hereto
(iv) purport to require the award or payment of attorneys' fees, expenses or
costs in any action where any Person is not the prevailing party, or the impact
of CC Section 1717 et seq. on any such provisions;
(v) provide that rights or remedies are not exclusive, that every right or
remedy is cumulative and may be exercised in addition to or with any other
right or remedy, that the election of some particular remedy or remedies does
not preclude recourse to one or another remedy or that failure to exercise or
delay in exercising rights or remedies will not operate as a waiver of any such
right or remedy;
(vi) prohibit waiver of any terms or provisions of the Operative Documents
other than in writing or prohibit oral modifications thereof or modification by
course of dealing to the extent such provisions are inconsistent with
applicable law;
(vii) address arbitration of disputes;
(viii) purport to waive statutes of limitation;
(ix) authorize Lessor or any other Person to set off and apply any deposits at
any time held, and any other indebtedness at any time owing, by Lessee or
Lessor to or for the account of Lessor;
(x) purport to limit the standards imposed upon any Person for the care of the
Collateral in such Person's possession;
(xi) purport to exclude conflict of law principles under California law or
otherwise select the laws of New York to govern any of the Operative Documents
or any security interest in real property located in the State of California;
(xii) require the Lessee or Lessor to provide hazard insurance coverage
against risks in an amount exceeding the replacement value of any improvements
to real property;
(xiii) impose requirements respecting impound accounts in conflict with
applicable law;
(xiv) provide for the application of insurance or condemnation proceeds to
reduce indebtedness;
(xv) purport to assign rents, issues and profits absolutely and not as
security;
(xvi) indemnify any Person against, or require contributions toward, that
Person's liability for its own wrongful or negligent acts or where such
indemnification or contribution is contrary to public policy or prohibited by
law;
(xvii) provide for penalties, liquidated damages, acceleration of future
amounts due (other than principal) without appropriate discount to present
value, late charges, prepayment charges and increased interest rates upon
default;
(xviii) provide that time is of the essence;
(xix) provide for the confession of judgment;
(xx) attempt to change or waive rules of evidence or fix the method or quantum
of proof to be applied in litigation or similar proceedings;
(xxi) provide for the exclusive jurisdiction of a particular court or purport
to waive rights to trial by jury, service of process or objections to the
laying of venue or to forum on the
145
To Each of the Parties
Listed on Schedule A April 23, 1999
Attached Hereto Page 20
basis of forum non conveniens, in connection with any litigation arising out of
or pertaining to the Operative Documents;
(xxii) appoint any Lender Party as Lessee's or Lessor's agent or
attorney-in-fact; or
(xxiii) any provision purporting to waive any right to claim punitive damages.
(bb) The enforceability of any provisions of the Operative Documents which
are deemed to constitute a subordination of the rights of Lessee or Lessor may
be limited by exoneration and other defenses similar to those that may be
asserted by any guarantor.
(cc) With respect to the provisions of the Operative Documents relating to
the application of condemnation proceeds, you should be aware that CCP Section
1265.225 provides that where there is a partial taking of property encumbered
by a lien, the lienholder may share in the award only to the extent determined
by the court to be necessary to prevent impairment of the security, and the
lien shall continue upon the part of the property not taken as security for the
unpaid portion of the indebtedness. However, the lienholder and the property
owner may at any time after commencement of the condemnation proceeding agree
that some or all of the award shall be apportioned to the lienholder on the
indebtedness.
(dd) Notwithstanding our opinions above, we express no opinion as to the
enforceability of the power of sale (and the related remedies of Lessor
consistent with the characterization of the Transaction as a loan) in the Lease
and the Lessor Deed of Trust, where a court of competent jurisdiction has not
recharacterized the Transaction, insofar as the Lease is concerned, as a loan
from Lessor to Lessee.
(ee) We wish to point out that the Lenders, as holders of the Tranche A
Notes and Tranch B Notes, may be required to prove the outstanding amount
thereof. We further wish to point out that under Section 18104 of the
California Probate Code, the Holders may be required to prove their interests
as beneficiaries under the VS Trust 1999-1.
Without qualification of the opinions rendered above, we express
no opinion as to (i) whether the Lease or any of the other Operative Documents
will be construed to create the legal relationships they purport to create for
purposes of determining the rights and obligations of the parties thereto; (ii)
whether the legal relationships purported to be created by the Lease or any of
the other Operative Documents will be binding and conclusive with respect to
the rights of persons who are not parties thereto; or (iii) whether the legal
relationships purported to be created by the Lease or any of the other
Operative Documents will be respected for tax, accounting, financial or other
regulatory purposes.
The opinions expressed herein are solely for your benefit and
for the benefit of your successors and assigns in connection with the
Transaction, and such opinions may not be relied on in any manner or for any
purpose by any other Person. In addition, this opinion is rendered as of the
date hereof and speaks only to the addresses set forth on Schedule A, and it
shall not be deemed to have been updated to any date upon which any such other
Person may
146
To Each of the Parties April 23, 1999
Listed on Schedule A Page 21
Attached Hereto
rely hereon. Further, we do not undertake to advise you or such other Person of
matters which occur subsequent to the date hereof and which affect the opinions
expressed herein.
Very truly yours,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
147
SCHEDULE A
NATIONSBANK, N.A., as the Agent, a Lender and a Holder
FIRST SECURITY BANK, NATIONAL ASSOCIATION, individually and as Borrower, Lessor
and Owner Trustee
COMERICA BANK - CALIFORNIA, as a Lender
KEYBANK, NATIONAL ASSOCIATION, as a Lender and a Holder
FLEET NATIONAL BANK, as a Lender and a Holder
Together with such parties' successors and assigns
148
EXHIBIT A
CERTIFICATE OF LESSEE
THIS CERTIFICATE OF LESSEE ("Certificate") is made as of April 23, 1999,
by Veritas Software Corporation, a Delaware corporation doing business in
California as Veritas Storage Management Corp. ("Lessee"). This Certificate is
made for the benefit of ▇▇▇▇▇▇▇, Phleger & ▇▇▇▇▇▇▇▇ LLP ("BPH") in connection
with BPH's opinion (the "Opinion") delivered to these parties listed in Schedule
A attached to the Opinion. Capitalized terms not defined herein are used herein
as defined in the Opinion.
After due inquiry and investigation, the undersigned hereby represents to
and for the benefit of BPH as follows:
1. I am an officer of Lessee (specifically, the Secretary of Lessee), and I
am familiar with the day-to-day operations of Lessee.
2. Lessee is party to no Material Agreements as of the date hereof (other
than the Operative Documents, except as set forth on Schedule 1 hereto.
"Material Agreement" means an agreement of Lessee involving borrowed money in an
amount (whether or not funded) in excess of $5,000,000, where Lessee is a
borrower or guarantor of the amount.
3. The Lessee Constituent Documents remain in full force and effect and
have not been altered or amended in any respect.
4. The Operative Documents do not and will not conflict with any Material
Agreement or other indenture, mortgage, deed of trust, contract, or other
material agreement or other instrument to which Lessee is a party or by which
Lessee is bound.
5. Except as set forth on Schedule 2 hereto, the representations and
warranties of Lessee contained in the Operative Documents to which it is a party
are true and correct on and as of the date hereof as though made on and as of
such date.
6. The Operative Documents do not and will not result in the creation or
imposition of any lien on any material asset of Lessee (other than liens
permitted under the Operative Documents).
7. The Operative Documents do not and will not violate or contravene any
judgment, decree, injunction or order of any federal, New York or California
court or other tribunal, or any arbitrator or governmental agency or authority
having jurisdiction over Lessee or the Property of Lessee and by which Lessee is
bound.
8. There are no proceedings pending, threatened or contemplated for the
dissolution, merger, consolidation or liquidation of Lessee or for the sale of
all or substantially all of the assets of Lessee.
149
9. There are no actions, suits or proceedings pending or, to the best of
my knowledge, threatened against or affecting the Lessee or the properties of
Lessee before any court, board of arbitration, governmental agency or authority
which (i) challenge or question the validity or enforceability of the Operative
Documents or the rights and remedies of the Lessor with respect to Lessee or
the Property under the Operative Documents, or (ii) which, if determined
adversely to Lessee, would be reasonably likely to have a Material Adverse
Effect (as such term is defined in Appendix A to the Participation Agreement).
10. All tax returns and payments due and owing with respect to Lessee
have been filed with or paid to the proper authorities in the State of
California.
11. The chief executive office of Lessee is located at ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇.
12. Lessee neither engages or holds itself out as being engaged
primarily, nor proposes to engage primarily, in the business of investing,
reinvesting or trading in securities.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as
Secretary of Lessee (and solely in such capacity) as of the day and year first
above written.
------------------------------------
Name:
-------------------------------
Title:
------------------------------
150
SCHEDULE 1
----------
Material Agreements
$100,000,000 5 1/4% Convertible Subordinated Notes Due November 1, 2004.
151
EXHIBIT H-1
[Outside Counsel Opinion of the Additional Credit Parties]
(Pursuant To Section 5.10(c) of the Participation Agreement)
TO THOSE ON THE ATTACHED DISTRIBUTION LIST
Re: Synthetic Lease Financing Provided in favor of Veritas Software
Corporation
Dear Sirs:
We have acted as special counsel to _______________, a _______________
corporation (the "Joinder Party") in connection with certain transactions
contemplated by the Participation Agreement dated as of April 23, 1999 (the
"Participation Agreement"), among Veritas Software Corporation, a Delaware
corporation (the "Lessee"), the various parties thereto from time to time, as
guarantors (the "Guarantors"), First Security Bank, National Association, as the
Owner Trustee (the "Owner Trustee"), the various banks and other lending
institutions which are parties thereto from time to time, as holders (the
"Holders"), the various banks and other lending institutions which are parties
thereto from time to time, as lenders (the "Lenders") and NationsBank, N.A., as
the agent for the Lenders and respecting the Security Documents, as the agent
for the Lenders and the Holders, to the extent of their interests (the "Agent").
This opinion is delivered pursuant to Section 5.10(c) of the Participation
Agreement. All capitalized terms used herein, and not otherwise defined herein,
shall have the meanings assigned thereto in Appendix A to the Participation
Agreement.
In connection with the foregoing, we have examined originals, or copies
certified to our satisfaction, of the Operative Agreements (including without
limitation that certain Joinder Agreement dated as of , (the
"Joinder Agreement"), between the Joinder Party and the Agent, and such other
corporate, partnership or limited liability company documents and records of
the Joinder Party, certificates of public officials and representatives of the
Joinder Party as to certain factual matters, and such other instruments and
documents which we have deemed necessary or advisable to examine for the
purpose of this opinion. With respect to such examination, we have assumed (i)
the statements of fact made in all such certificates, documents and instruments
are true, accurate and complete; (ii) the due authorization, execution and
delivery of the Operative Agreements by the parties thereto other than the
Joinder Party; (iii) the genuineness of all signatures (other than the
signatures of persons signing on behalf of the Joinder Party), the authenticity
and completeness of all documents, certificates, instruments, records and
corporate records submitted to us as originals and the conformity to the
original
152
instruments of all documents submitted to us as copies, and the authenticity
and completeness of the originals of such copies; (iv) that all parties other
than the Joinder Party have all requisite corporate power and authority to
execute, deliver and perform the Operative Agreements; and (v) the
enforceability of the Operative Agreements against all parties thereto other
than the Joinder Party. We have further assumed that the laws of the States of
[STATE OF LAWYER'S ADMISSION] and New York are substantively identical.
Based on the foregoing, and having due regard for such legal considerations as
we deem relevant, and subject to the limitations and assumptions set forth
herein, including without limitation the matters set forth in the last two (2)
paragraphs hereof, we are of the opinion that:
(a) The Joinder Party is a corporation, duly incorporated, validly
existing and in good standing under the laws of _____________ and has the power
and authority to conduct its business as presently conducted and to execute,
deliver and perform its obligations under the Operative Agreements to which it
is a party. The Joinder Party is duly qualified to do business in all
jurisdictions in which its failure to so qualify would materially impair its
ability to perform its obligations under the Operative Agreements to which it is
a party or its financial position or its business as now and now proposed to
be conducted.
(b) The execution, delivery and performance by the Joinder Party of the
Operative Agreements to which it is a party have been duly authorized by all
necessary corporate action on the part of the Joinder Party and the Operative
Agreements to which the Joinder Party is a party have been duly executed and
delivered by the Joinder Party.
(c) The Operative Agreements to which the Joinder Party is a party
constitute valid and binding obligations of the Joinder Party enforceable
against the Joinder Party in accordance with the terms thereof, subject to
bankruptcy, insolvency, liquidation, reorganization, fraudulent conveyance, and
similar laws affecting creditors' rights generally, and general principles of
equity (regardless of whether the application of such principles is considered
in a proceeding in equity or at law).
(d) The execution and delivery by the Joinder Party of the Operative
Agreements to which it is a party and compliance by the Joinder Party with all
of the provisions thereof do not and will not (i) contravene the provisions of,
or result in any breach of or constitute any default under, or result in the
creation of any Lien (other than Permitted Liens and Lessor Liens) upon any of
its property under, its Articles of Incorporation and By-Laws or any indenture,
mortgage, chattel mortgage, deed of trust, lease, conditional sales contract,
bank loan or credit agreement or other agreement or instrument to which the
Joinder Party is a party or by which it or any of its property may be bound or
affected, or (ii) contravene any Laws or any order of any Governmental
Authority applicable to or binding on the Joinder Party.
(e) No Governmental Action by, and no notice to or filing with, any
Governmental Authority is required for the due execution, delivery or
performance by the Joinder Party of any of the Operative Agreements to which it
is a party or for the acquisition, ownership, construction and completion of the
Properties, except for those which have been obtained.
▇-▇-▇
▇▇▇
(▇) Except as set forth on Schedule 1 hereto, there are no actions, suits
or proceedings pending or to our knowledge, threatened against the in any court
or before any Governmental Authority that concern the Properties or the Joinder
Party's interest therein or that question the validity or enforceability of any
Operative Agreement to which the Joinder Party is a party or the overall
transaction described in the Operative Agreements to which the Joinder Party is
a party.
(g) Neither the nature of the Properties, nor any relationship between the
Joinder Party and any other Person, nor any circumstance in connection with the
execution, delivery and performance of the Operative Agreements to which the
Joinder Party is a party is such as to require any approval of stockholders of,
or approval or consent of any trustee or holders of indebtedness of, the Joinder
Party, except for such approvals and consents which have been duly obtained and
are in full force and effect.
(h) Except with respect to (i) perfection and the effect of perfection or
nonperfection of the security interest in the Collateral, and (ii) usury law, in
any action or proceeding arising out of or related to any of the
Operative Agreements in any court of the State of California or in any federal
court sitting in the State of California, such court would recognize and give
effect to the New York choice of law provisions of the Operative Agreements.
This opinion is limited to the matter stated herein and no opinion is
implied or may be inferred beyond the matters state herein. This opinion is
based on and is limited to the laws of the States of [ ], and the federal
laws of the United States of America. Insofar as the foregoing opinion relates
to matters of law other than the foregoing, no opinion is hereby given.
This opinion is for the sole benefit of the Joinder Party, the Lessee, the
Construction Agent, the Guarantors, the Owner Trustee, the Holders, the Lenders,
the Agent and their respective successors and assigns and may not be relied upon
by any other person other than such parties and their respective successors and
assigns without the express written consent of the undersigned. The opinions
expressed herein are as of the date hereof and we make no undertaking to amend
or supplement such opinions if facts come to our attention or changes in the
current law of the jurisdictions mentioned herein occur which could affect such
opinions.
Very truly yours,
[JOINDER PARTY'S OUTSIDE COUNSEL]
H-1-3
154
Distribution List
NATIONSBANK, N.A., as the Agent, a Holder and a Lender
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as additional Holders
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as additional Lenders
Veritas Software Corporation, as the Construction Agent and the Lessee
The various parties to the Participation Agreement from time to time as
Guarantors
First Security Bank, National Association, not individually, but solely as the
Owner Trustee under the VS Trust 1999-1
, as the Joinder Party
--------------------------------
H-1-4
155
Schedule 1
(Litigation)
H-1-5
156
EXHIBIT I
VERITAS SOFTWARE CORPORATION
OFFICER'S CERTIFICATE
(Pursuant to Section 5.5 of the Participation Agreement)
VERITAS SOFTWARE CORPORATION, a Delaware corporation (the "Company") 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. Attached hereto as Schedule 1 is the detailed, itemized documentation
supporting the asserted Property Cost figures.
4. All representations and warranties of the Company in each Operative
Agreement and in each certificate delivered pursuant thereto (including
without limitation the Incorporated Representations and Warranties) are
true and correct as of the Completion Date.
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 April 23, 1999 among the Company, as the Lessee and as the
Construction Agent, the various parties thereto from time to time, as
guarantors (the "Guarantors"), First Security Bank, National Association, as
the Owner Trustee, the various banks and other lending institutions which are
parties thereto from time to time, as holders (the "Holders"), the various
banks and other lending institutions which are parties thereto from time to
time, as lenders (the "Lenders"), NationsBank, N.A., as the agent for the
Lenders and respecting the Security Documents, as the agent for the Lenders and
the Holders, to the extent of their interests.
[The remainder of this page has been intentionally left blank.]
I-1
157
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to
be duly executed and delivered as of this ___ day of ______________, ______.
VERITAS SOFTWARE CORPORATION
By: _________________________________
Name: _______________________________
Title: ______________________________
I-2
158
Schedule 1
(Itemized Documentation in Support of Asserted Property Cost)
I-3
159
EXHIBIT J
[Description of Material Litigation]
(Pursuant to Section 6.2(d) of the Participation Agreement)
EXHIBIT J
The following are pre-litigation matters in which Lessee is currently
involved and for which Lessee could face liability:
1. NETWORK CATALYST, INC. ("NCI")
NCI alleges that Lessee (formerly OpenVision) may have underreported
royalties for the System Detective software product over the past four years.
NCI also alleges that Lessee failed to collect monies owed by customers for
renewals of maintenance contracts for System Detective software and that Lessee
owed NCI a responsibility for renewing such contracts.
2. THE SCRIPPS RESEARCH INSTITUTE ("TSRI")
Lessee (formerly OpenVision) is currently in settlement negotiations with
TSRI. TSRI alleges that the HSM software purchased from Lessee was not fully
functional on its systems.
3. FUSION
Three former principals of Fusion ("Fusion Affiliates") allege that Lessee
(formerly OpenVision) failed to furnish royalty reports to them and/or sent
reports lacking reasonable detail, in accordance with an agreement executed in
1993, regarding revenue from AXXION/HA and DTS products.
4. ▇▇▇▇▇ ▇▇▇▇▇▇▇
An employment matter in which ▇▇. ▇▇▇▇▇▇▇ has alleged wrongful termination
based on violations of his religious, constitutional and political beliefs.
J-1
160
EXHIBIT K
[Form of Joinder Agreement]
(Pursuant to Section 5.10(a) of the Participation Agreement)
THIS JOINDER AGREEMENT (as amended, modified, supplemented, restated and/or
replaced from time to time, the "Agreement"), dated as of , , is by and
between , a (the "Company"), and NationsBank, N.A., as the Agent
for the Lenders and respecting the Security Documents, as the Agent for the
Lenders and the Holders, to the extent of their interests (the "Agent").
Capitalized terms not otherwise defined herein shall have the meanings set forth
therefor in the Participation Agreement dated as of April 23, 1999 (as amended,
modified, supplemented, restated and/or replaced from time to time, the
"Participation Agreement") among Veritas Software Corporation, as the
Construction agent and the Lessee, the various parties thereto from time to
time, as the Guarantors, First Security Bank, National Association, as the Owner
Trustee under the VS Trust 1999-1, the various banks and other lending
institutions which are parties thereto from time to time, as the Lenders, the
various banks and other lending institutions which are parties thereto from time
to time, as the Holders, and the Agent.
The Company is either a Domestic Subsidiary or the Parent, and,
consequently, the Credit Parties are required by Section 8.3(s) of the
Participation Agreement to cause the Company to become a "Guarantor".
Accordingly, the Company hereby agrees as follows with the Agent, for the
benefit of the Financing Parties:
1. The Company hereby acknowledges, agrees and confirms that, by its
execution of this Agreement, the Company will be deemed to be a party to the
Participation Agreement and a "Guarantor" for all purposes of the Participation
Agreement and all other Operative Agreements, and shall have all of the
obligations of a Guarantor under the Operative Agreements as if the Company had
executed the Participation Agreement. The Company hereby ratifies, as of the
date hereof, and agrees to be bound by, all of the terms, provisions and
conditions applicable to the Guarantors contained in the Operative Agreements.
Without limiting the generality of the foregoing terms of this paragraph 1, the
Company hereby (i) jointly and severally together with the other Guarantors,
guarantees to each Financing Party, as provided in Section 6B.1 through 6B.8 of
the Participation Agreement, the prompt payment and performance of the Company
Obligations in full when due (whether at stated maturity, as a mandatory
prepayment, by acceleration or otherwise) strictly in accordance with the terms
thereof.
2. THE COMPANY HEREBY EXPRESSLY ACKNOWLEDGES AND AGREES TO THE
PROVISIONS OF SECTION 12.7 OF THE PARTICIPATION AGREEMENT, INCLUDING WITHOUT
LIMITATION THOSE PROVISIONS REGARDING GOVERNING LAW, SUBMISSION TO
JURISDICTION, WAIVER OF
K-1
161
JURY TRIAL AND VENUE. THIS PROVISION HAS BEEN SPECIFICALLY REVIEWED BY THE
COMPANY.
3. The chief executive office and principal place of business of the
Company are located at the location(s) set forth on Schedule 1 attached hereto.
4. All notices and other communications to be delivered to the Company
shall be directed to [__________] at its address set forth in Section 12.2 of
the Participation Agreement or such other address as may be specified, in
accordance with the terms of the Participation Agreement by [__________] from
time to time.
5. The Company hereby waives acceptance by the Financing Parties of the
guaranty by the Company under Sections 6B.1 through 6B.8 of the Participation
Agreement upon the execution of this Agreement by the Company.
6. This Agreement may be executed in multiple counterparts, each of
which shall constitute an original but all of which when taken together shall
constitute one contract.
7. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed by its authorized officers, and the Agent, for the benefit of the
Financing Parties, has caused the same to be accepted by its authorized
officer, as of the day and year first above written.
[COMPANY]
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
Acknowledged and accepted:
[BANK],
as the Agent
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
K-2
162
Schedule 1
[Chief Executive Office and
Principal Place of Business of the Company]
K-3
163
-------------------------------------------------------------------------------
Appendix A
Rules of Usage, Accounting Terms 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, restated
and/or replaced from time to time in accordance with the applicable provisions
thereof.
(f) Except as otherwise expressly provided, references to any law includes
any amendment or modification to such law and any rules or regulations issued
thereunder or any law enacted in substitution or replacement therefor.
(g) When used in any document, words such as "hereunder", "hereto",
"hereof" and "herein" and other words of like import shall, unless the context
clearly indicates to the contrary, refer to the whole of the applicable
document and not to any particular article, section, subsection, paragraph or
clause thereof.
(h) References to "including" means including without limiting the
generality of any description preceding such term and for purposes hereof the
rule of ejusdem generis shall not be
A-1
164
applicable to limit a general statement, followed by or referable to an
enumeration of specific matters, to matters similar to those specifically
mentioned.
(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.
II. Accounting Terms
Except as otherwise expressly provided herein, all accounting terms used
herein shall be interpreted, and all financial statements and certificates and
reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Agreement and the other Operative Agreements shall (except as otherwise
expressly provided herein or therein) be made by application of GAAP applied on
a basis consistent with the most recent annual or quarterly financial statements
delivered pursuant to Section 8.3A(a) (or, prior to the delivery of the first
financial statements pursuant to Section 8.3A(a), consistent with the financial
statements as at December 31, 1997); provided, however, if (a) the Credit
Parties shall reasonably object to determining such compliance on such basis at
the time of delivery of such financial statements due to any change in GAAP or
the rules promulgated with respect thereto or (b) the Agent or the Majority
Secured Parties shall so object in writing within 60 days after delivery of such
financial statements, then such calculations shall be made on a basis consistent
with the most recent financial statements delivered by the Credit Parties to the
Lenders as to which no such objection shall have been made.
Notwithstanding the above, the parties hereto acknowledge and agree that, for
purposes of all calculations made under the financial covenants set forth in
Section 8.3A(h) so long as the Lessee shall have provided the Agent with a Pro
Forma Compliance Certificate with respect to any Permitted Acquisition, income
statement items (whether positive or negative) attributable to the Property
acquired in such Permitted Acquisition and any Indebtedness incurred by the
applicable Credit Parties in order to consummate such Permitted Acquisition
shall be included to the extent relating to any period applicable in such
calculations occurring after the date of such Permitted Acquisition (and,
notwithstanding the foregoing, during the first four fiscal quarters following
the date of such Permitted Acquisition, such Permitted Acquisition and any
Indebtedness incurred by the applicable Credit Parties in order to consummate
such Permitted
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Acquisition (A) shall be deemed to have occurred on the first day of the four
fiscal quarter period immediately preceding the date of such Permitted
Acquisition and (B) if such Indebtedness has a floating or formula rate, then
the implied rate of interest for such Indebtedness for the applicable period
shall be determined by utilizing the rate which is or would be in effect with
respect to such Indebtedness as at the relevant date of determination.
III. 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 which the Agent
announces 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 does not necessarily
represent the lowest or best rate actually charged to any customer. Any 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 Holder Advance" shall mean a Holder Advance bearing a Holder Yield
based on the ABR.
"ABR Loans" shall mean Loans the rate of interest applicable to which is
based upon the ABR.
"Acceleration" shall have the meaning given to such term in Section 6 of
the Credit Agreement.
"ACCORD Evidence of Insurance" shall mean an ACCORD Evidence of Insurance
or other similar evidence of insurance reasonably acceptable to the Agent.
"Accounts" shall have the meaning given to such term in Section 1 of the
Security Agreement.
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"Acquisition Advance" shall have the meaning given to such term in Section
5.3 of the Participation Agreement.
"Acquisition Loan" shall mean any Loan made in connection with an
Acquisition Advance.
"Advance" shall mean a Construction Advance or an Acquisition Advance.
"Affiliate" shall mean, with respect to any Person, any Person or group
acting in concert in respect of the Person in question that, directly or
indirectly, controls or is controlled by or is under common control with such
Person.
"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 on or about the
Initial Closing Date between the Construction Agent and the Lessor.
"Agency Agreement Event of Default" shall mean an "Event of Default" as
defined in Section 5.1 of the Agency Agreement.
"Agent" shall mean NationsBank, N.A., as agent for the Lenders pursuant to
the Credit Agreement, or any successor agent appointed in accordance with the
terms of the Credit Agreement and respecting the Security Documents, for the
Lenders and the Holders, to the extent of their interests.
"Applicable Percentage" shall mean for Eurodollar Loans, Eurodollar Holder
Advances and Commitment Fees, the appropriate applicable percentages
corresponding to the Pricing Level in effect as of the most recent Calculation
Date as shown below;
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==================================================================================================
Ratio of Funded Applicable Applicable
Indebtedness Applicable Percentage for Percentage for
Pricing to EBITDA and level Percentage for Eurodollar Commitment
Level of EBITDA Eurodollar Loans Holder Advances Fee
--------------------------------------------------------------------------------------------------
I Funded Indebtedness .875% 1.875% .225%
(EBITDA < or equal to
.80 and EBITDA > or
equal to $250 million
--------------------------------------------------------------------------------------------------
II Funded Indebtedness/ 1.000% 2.000% .250%
EBITDA < or equal to
.80 and EBITDA > or
equal to $150 million
but < $250 million
--------------------------------------------------------------------------------------------------
III Funded Indebtedness/ 1.125% 2.125% .275%
EBITDA > .80 and EBITDA
> or equal to $250 million
--------------------------------------------------------------------------------------------------
IV Funded Indebtedness/ 1.250% 2.250% .300%
EBITDA < or equal to
.80 and EBITDA > or equal
to $75 million but < $150
million or Funded
Indebtedness/EBITDA >
.80 and EBITDA > or equal
to $150 million but <
$250 million
--------------------------------------------------------------------------------------------------
V Funded Indebtedness/ 1.50% 2.500% .375%
EBITDA < or equal to
.80 and EBITDA < $75
million or Funded
Indebtedness/EBITDA
> .80 and EBITDA > or
equal to $75 million
but < $150 million
--------------------------------------------------------------------------------------------------
VI Funded Indebtedness/ 1.750% 2.750% .450%
EBITDA > .80 and EBITDA
< $75 million
==================================================================================================
The Applicable Percentage for Eurodollar Loans, Eurodollar Holder Advances
and the Commitment Fees shall, in each case, be determined and adjusted
quarterly on the first day of
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each fiscal quarter of the Lessee (each a "Calculation Date"); provided,
however, that (i) the initial Applicable Percentage, in each case, shall be
based on Pricing Level V (as shown above) and shall remain at Pricing Level V
until the occurrence of the Calculation Date relating to the second fiscal
quarter of the Lessee occurring in fiscal year 1999 and, thereafter, the
Pricing Level shall be determined as shown above, and (ii) if the Lessee fails
to provide the written notice required by Section 8.3(k) of the Participation
Agreement to the Agent on or before the most recent Calculation Date, the
Applicable Percentage, in each case, from such Calculation Date shall be based
on Pricing Level VI until such time that such written notice is provided
whereupon the Pricing Level shall be determined as specified in such notice.
Each Applicable Percentage shall be effective from one Calculation Date until
the next Calculation Date. Any adjustment in the Applicable Percentage shall be
applicable to all existing Eurodollar Loans and Eurodollar Holder Advances as
well as any new Eurodollar Loans and Eurodollar Holder Advances made or issued.
"Appraisal" shall mean, with respect to any Property or the Properties,
taken as a whole, an 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 in the judgment of counsel to the Agent, complies with all of the
provisions of the Financial Institutions Reform, Recovery and Enforcement Act
of 1989, as amended, the rules and regulations adopted pursuant thereto, and
all other applicable Legal Requirements.
"Appraisal Procedure" shall have the meaning given such term in Section
22.4 of the Lease.
"Approved State" shall mean each of the following: California and any
other state within the continental United States proposed by the Lessee and
consented to in writing by the Agent.
"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.
"Available Commitment" shall mean, as to any Lender at any time, an amount
equal to the excess, if any, of (a) the amount of such Lender's Commitment over
(b) the aggregate principal amount of all Loans made by such Lender as of such
date after giving effect to Section 5.2(d) of the Participation Agreement (but
without giving effect to any other repayments or prepayments of any Loans
hereunder).
"Available Holder Commitments" shall mean an amount equal to the excess,
if any, of (a) the aggregate amount of the Holder Commitments over (b) the
aggregate amount of the Holder
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Advances made since the Initial Closing Date after giving effect to Section
5.2(d) of the Participation Agreement (but without giving effect to any other
repayments or prepayments of any Holder Advances).
"Bankruptcy Code" shall mean title 11 of the U.S. Code entitled
"Bankruptcy," as now or hereafter in effect or any successor thereto.
"Basic Documents" shall mean the following: the Participation Agreement,
the Agency Agreement, the Trust Agreement, the Certificates, the Credit
Agreement, the Notes, the Lease and the Security Agreement.
"Basic Rent" shall mean, the sum of (a) the Loan Basic Rent and (b) the
Lessor Basic Rent, calculated as of the applicable date on which Basic Rent is
due.
"Basic Term" shall have the meaning specified in Section 2.2 of the Lease.
"Basic Term Commencement Date" shall have the meaning specified in Section
2.2 of the Lease.
"Basic Term Expiration Date" shall have the meaning specified in Section
2.2 of the Lease.
"Benefited Lender" shall have the meaning specified in Section 9.10(a) of
the Credit 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 the Owner Trustee, not in its individual capacity but
as Borrower under the Credit Agreement.
"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 Lenders to make Loans hereunder.
"Budgeted Total Property Cost" shall mean, at any date of determination
with respect to any Construction Period Property, an amount equal to the
aggregate amount which the Construction Agent in good faith expects to be
expended in order to achieve Completion with respect to such Property.
"Business Day" shall mean a day other than a Saturday, Sunday or other day
on which commercial banks in North Carolina or any other states from which the
Agent, any Lender or any
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Holder funds or engages in administrative activities with respect to the
transactions under 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.
"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 Expenditures" shall mean all expenditures of the Credit Parties
and their Consolidated Subsidiaries which, in accordance with GAAP, would be
classified as capital expenditures, including, without limitation, Capitalized
Leases.
"Capital Stock" shall mean any nonredeemable capital stock of any Credit
Party or any of its Subsidiaries, whether common or preferred.
"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) having maturities of not more
than twelve months from the date of acquisition, (b) U.S. dollar denominated
time and demand deposits and certificates of deposit of (i) any Lender, (ii) any
domestic commercial bank having capital and surplus in excess of $500,000,000 or
(iii) 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 (any such bank being an "Approved Bank"), 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 any variable rate notes issued by, 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 and maturing within six
months of the date of acquisition, (d) repurchase agreements with a bank or
trust company (including any of the 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 in which the
Lessee shall have a perfected first priority security interest (subject to no
other Liens) 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 (d).
"Casualty" shall mean any damage or destruction of all or any portion of
the Property as a result of a fire or other casualty.
"CD" shall have the meaning given to such term in Section 15.2(a) of the
Lease.
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"CERCLA" shall mean the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, 42 U.S.C. Section 9601 et seq., as amended by the
Superfund Amendments and Reauthorization Act of 1986.
"Certificate" shall mean a Certificate in favor of each Holder regarding
the Holder Commitment of such Holder issued pursuant to the terms and conditions
of the Trust Agreement in favor of each Holder.
"Change of Control" shall mean the occurrence of any of the following
events: (a) prior to the Reorganization, a "person" or a "group" (within the
meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act) shall
have acquired beneficial ownership, directly or indirectly, of, or shall have
acquired by contract or otherwise, or shall have entered into a contract or
arrangement that, upon consummation, will result in its or their acquisition of,
control over, 30% or more of the outstanding voting stock of the Lessee, (b)
after the Reorganization, (i) the Parent shall fail to own directly 100% of the
outstanding Capital Stock of the Lessee, (ii) a "person" or a "group" (within
the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act)
(other than SSI) shall have acquired beneficial ownership, directly or
indirectly, of, or shall have acquired by contract or otherwise, or shall have
entered into a contract or arrangement that, upon consummation, will result in
its or their acquisition of, control over, 30% or more of the outstanding voting
stock of the Parent or (iii) SSI shall have acquired beneficial ownership,
directly or indirectly, of, or shall have acquired by contract or otherwise, or
shall have entered into a contract or arrangement that, upon consummation, will
result in its acquisition of, control over, 45% or more of the outstanding
voting stock of the Parent or (c) during any period of two consecutive calendar
years, individuals who at the beginning of such period constituted either the
board or the board of directors of the Lessee or the Parent, as the case may be,
together with any new members of such board or board of directors (i) whose
elections by such board or board of directors or whose nomination for election
by the stockholders of the Lessee or the stockholders of the Parent, as the case
may be, was approved by a vote of a majority of the members of such board or
board of directors then still in office who either were directors at the
beginning of such period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority of the
directors of the Lessee or of the Parent, as the case may be, then in office.
Notwithstanding the foregoing in subsection (c), the three new board members
appointed to the board of directors of the Parent in connection with the
Reorganization shall be an acceptable change to the board of directors of the
Parent. As used herein, "beneficial ownership" shall have the meaning provided
in Rule 13(d)-3 of the Securities and Exchange Commission under the Securities
Act of 1934.
"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 Date" shall mean the Initial Closing Date and each Property
Closing Date.
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"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.
"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.
"Collateral Assignment of Sublease" shall mean, with respect to the
▇▇▇▇▇▇▇▇▇ Sublease, that certain Collateral Assignment dated on or about the
applicable Property Closing Date executed by the Lessee in favor of the Agent.
"Commitment" shall mean, as to any Lender, the obligation of such Lender
to make the portion of the Loans to the Lessor in an aggregate principal amount
at any time outstanding not to exceed the amount set forth opposite such
Lender's name on Schedule 2.1 of the Credit Agreement, as such amount may be
increased or reduced from time to time in accordance with the provisions of the
Operative Agreements.
"Commitment Fee" shall mean, collectively, the Holder Commitment Fee and
the Lender Commitment Fee.
"Commitment Fee Payment Date" shall mean the last Business Day of each
March, June, September and December and the last Business Day of the Commitment
Period, or such earlier date as the Commitments shall terminate as provided in
the Credit Agreement or the Holder Commitment shall terminate as provided in
the Trust Agreement.
"Commitment Percentage" shall mean, as to any Lender at any time, the
percentage which such Lender's Commitment then constitutes of the aggregate
Commitments (or, at any time after the Commitments shall have expired or
terminated, the percentage which the aggregate principal amount of such
Lender's Loans then outstanding constitutes of the aggregate principal amount
of all of the Loans then outstanding), and such Commitment Percentage shall
take into account both the Lender's Tranche A Commitment and the Lender's
Tranche B Commitment.
"Commitment Period" shall mean the period from and including the Initial
Closing Date to and including the Construction Period Termination Date, or such
earlier date as the Commitments shall terminate as provided in the Credit
Agreement or the Holder Commitment shall terminate as provided in the Trust
Agreement.
"Company Obligations" shall mean the obligations of VSC, in any and all
capacities under and with respect to the Operative Agreements and each Property.
"Completion" shall mean, with respect to the Properties, such time as the
acquisition, installation, testing and final completion of the Improvements has
been substantially 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 (except if non-compliance,
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individually or in the aggregate, shall not have and could not reasonably be
expected to have a Material Adverse Effect), a certificate of occupancy has
been issued by the appropriate governmental entity and the Lessee shall have
the obligation under the Lease to pay Rent as of such date. If the Lessor
purchases a Property that includes existing Improvements that are to be
immediately occupied by the Lessee without any improvements financed pursuant
to the Operative Agreements, the date of Completion for such Property shall be
the Property Closing Date.
"Completion Date" shall mean, with respect to the Properties, the earlier
of (a) the date on which Completion for the Properties has occurred or (b) the
Construction Period Termination Date.
"Condemnation" shall mean any taking or sale of the use, access,
occupancy, easement rights or title to any Property or any part thereof, wholly
or partially (temporarily or permanently), by or on account of 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, any Property or alter the pedestrian or vehicular traffic flow to any
Property so as to result in a change in access to such Property, or 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 Property
Costs pursuant to Section 5.4 of the Participation Agreement.
"Construction Agent" shall mean Veritas Software Corporation, a Delaware
corporation, as the construction agent under the Agency Agreement.
"Construction Agent Options" shall have the meaning given to such term in
Section 2.1 of the Agency Agreement.
"Construction Budget" shall mean the cost of acquisition, installation,
testing, constructing and developing the Properties as determined by the
Construction Agent in its reasonable, good faith judgment.
"Construction Commencement Date" shall mean, with respect to Improvements,
the date on which construction of such Improvements commences pursuant to the
Agency Agreement.
"Construction 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.
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"Construction Loan" shall mean any Loan made in connection with a
Construction Advance.
"Construction Loan Property Cost" shall mean with respect to the
Construction Period Properties at the date of determination, an amount equal to
(a) the aggregate principal amount of Construction Loans made on or prior to
such date with respect to the Properties minus (b) the aggregate principal
amount of prepayments or repayments of the Loans allocated to reduce the
Construction Loan Property Cost of such Properties pursuant to Section 2.6(c) of
the Credit Agreement.
"Construction Period" shall mean, with respect to the Properties, the
period commencing on the Construction Commencement Date and ending on the
Completion Date.
"Construction Period Property" means, at any date of determination, the
Properties as to which the Rent Commencement Date has not occurred on or prior
to such date.
"Construction Period Termination Date" shall mean, subject to the
extension of such date by the Lenders and the Holders, in their sole and
absolute discretion, in accordance with the provisions set forth in Sections 2.1
and 2.6(c) of the Agency Agreement, (a) the earlier of (i) the date that the
Commitments have been terminated in their entirety in accordance with the terms
of Section 2.5(a) of the Credit Agreement, or (ii) the second anniversary of the
Initial Closing Date or (b) such later date as may 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.
"Contributed Companies" shall mean NSMG, Seagate Software Limited, a
corporation formed under the laws of the United Kingdom, Seagate Software GmbH,
a corporation formed under the laws of Germany, Seagate Software International
Holdings Ltd., a limited liability company organized under the laws of the
Cayman Islands and Seagate Software Storage Management Group, Inc., a Delaware
corporation.
"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.
"Co-Owner Trustee" shall have the meaning specified in Section 9.2 of the
Trust Agreement.
"Credit Agreement" shall mean the Credit Agreement, dated on or about the
Initial Closing Date, among the Lessor, the Agent and the 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.
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"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 Agency
Agreement, the Credit Agreement, the Notes and the Security Documents.
"Credit Parties" shall mean the Construction Agent, the Lessee and each
Guarantor.
"Deed" shall mean a warranty deed regarding the Land and/or Improvements
in form and substance satisfactory to the Agent.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Holder" shall have the meaning given to such term in Section
12.4 of the Participation Agreement.
"Defaulting Lender" shall have the meaning given to such term in Section
12.4 of the Participation Agreement.
"Deficiency Balance" shall have the meaning given in Section 22.1(b) of
the Lease Agreement.
"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.
"EBITDA" shall mean, for any period, with respect to the Credit Parties
and their Consolidated Subsidiaries on a consolidated basis, without
duplication, the sum of (a) Net Income for such period plus (b) an amount
which, in the determination of Net Income for such period has been deducted for
(i) Interest Expense for such period, (ii) total Federal, state, foreign or
other income taxes for such period, as determined in accordance with GAAP,
(iii) all depreciation and amortization for such period, as determined in
accordance with GAAP, and (iv) during any period within four years of the
closing of any Permitted Acquisition or the Reorganization, all non-cash
restructuring charges for such period taken in connection with such Permitted
Acquisition or the Reorganization (excluding any non-cash charges that require
an accrual or reserve for cash charges for any future period) minus (c) an
amount equal to any software development expenses occurring during such period
which have been classified as a capital expenditure.
"Election Notice" shall have the meaning given to such term in Section
20.1 of the Lease.
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"Eligible Assignee" shall mean (i) a Lender or a Holder, as the case may
be: (ii) an Affiliate of a Lender or a Holder, as the case may be; and (iii)
any other Person approved by the Agent and, unless an Event of Default has
occurred and is continuing at the time any assignment is effected in accordance
with the Operative Agreements, the Lessee or the Construction Agent, such
approval not to be unreasonably withheld or delayed by the Lessee or the
Construction Agent and such approval to be deemed given by the Lessee or the
Construction Agent if no objection is received by the assigning Lender or
Holder and the Agent from the Lessee or the Construction Agent within two
Business Days after notice of such proposed assignment has been provided by the
assigning Lender or Holder to the Lessee or the Construction Agent; provided,
however, that neither the Lessee or the Construction Agent nor an Affiliate of
the Lessee or the Construction Agent shall qualify as an Eligible Assignee.
"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 any Closing Date.
"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) 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) form any actual or alleged damage,
injury, threat, or harm to health, safety, natural resources, or the
environment.
"Environmental Laws" shall mean any current or future legal requirement of
any Governmental Authority pertaining to (a) the protection of health, safety,
and the indoor or outdoor environment, (b) the conservation, management, or use
of natural resources and wildlife, (c) the protection or use of surface water
and groundwater or (d) the management, manufacture, possession, presence, use,
generation, transportation, treatment, storage, disposal, release, threatened
release, abatement, removal, remediation or handling of, or exposure to, any
hazardous or toxic substance or material or (e) pollution (including any
release to land surface water and groundwater and includes, without limitation,
the Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended by the Superfund Amendments and Reauthorization Act of 1986,
42 USC 9601 et seq., Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act of 1976 and Hazardous and Solid Waste Amendments
of 1984, 42 USC 6901 et seq., Federal Water Pollution Control Act, as amended
by the Clean Water Act of 1977, 33 USC 1251 et seq., Clean Air Act of 1966, as
amended, 42 USC 7401 et seq., Toxic Substances Control Act of 1976, 15 USC 2601
et seq., Hazardous Materials Transportation Act, 49 USC App. 1801 et seq.,
Occupational Safety and Health Act of 1970, as amended, 29 USC 651 et seq., Oil
Pollution Act of 1990, 33 USC 2701 et seq., Emergency Planning and Community
Right-to-Know Act of 1986, 42 USC 11001 et seq., National Environmental Policy
Act of 1969, 42 USC
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4321 et seq., Safe Drinking Water Act of 1974, as amended, 42 USC 300(f) et
seq., any analogous implementing or successor law, and any amendment, rule,
regulation, order, or directive issued thereunder.
"EPA" shall have the meaning given to such term in Section 15.2(a) of the
Lease.
"EPA Comfort Letter" shall mean, with respect to any Property, a letter
from the EPA respecting compliance with the CD, remediation of the Pre-Existing
Environmental Conditions and related matters, in form and substance acceptable
to the Agent.
"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.
"Equipment" shall mean equipment, apparatus, furnishings, fittings and
personal property of every kind and nature whatsoever purchased, leased or
otherwise acquired using the proceeds of the Loans or the Holder 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, 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), telephones, communication systems (including without limitation
satellite dishes and antennae), televisions, computers, sprinkler systems and
other fire prevention and extinguishing apparatus and materials, security
systems, motors, engines, machinery, pipes, pumps, tanks, conduits, appliances,
fittings and fixtures of every kind and description.
"Equipment Schedule" shall mean (a) each Equipment Schedule attached to
the applicable Requisition and (b) each Equipment Schedule attached to the
applicable Lease Supplement.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"ERISA Affiliate" shall mean an entity, whether or not incorporated, which
is under common control with any Credit Party or any of its Consolidated
Subsidiaries within the meaning of Section 4001(a)(14) of ERISA, or is a member
of a group which includes any Credit Party or any
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of its Consolidated Subsidiaries and which is treated as a single employer under
Sections 414(b), (c), (m), or (o) of the Code.
"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 Holder Advance" shall mean a Holder Advance bearing a Holder
Yield based on the Eurodollar Rate.
"Eurodollar Loans" shall mean Loans the rate of interest applicable to
which is based upon the Eurodollar Rate.
"Eurodollar Rate" means for any Eurodollar Loan or Eurodollar Holder
Advance comprising part of the same borrowing or advance (including without
limitation conversions, extensions and renewals), for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as the
London interbank offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period. If for any reason such
rate is not available, the term "Eurodollar Rate" shall mean, for any Eurodollar
Loan or Eurodollar Holder Advance for any Interest Period therefor, the rate per
annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on
Reuters Screen LIBO Page as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period for a term comparable to such Interest Period;
provided, however, if more than one rate is specified on Reuters Screen LIBO
Page, the applicable rate shall be the arithmetic mean of all such rates
(rounded upwards, if necessary, to the nearest 1/100 of 1%). 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" shall mean for the Interest Period for each
Eurodollar Loan or Eurodollar Holder Advance comprising part of the same
borrowing or advance (including without limitation conversions, extensions and
renewals), the average (rounded upward to the nearest one sixteenth (1/16) of
one percent (1%)) 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/or Eurodollar Holder Advance.
If no such offers or quotes are generally available for such
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amount, then the Agent shall be entitled to determine the Eurodollar Rate 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 or a Credit Agreement Event of Default.
"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 the Owner Trustee, any Holder or any of their respective
Affiliates, agents, officers, directors or employees is entitled;
(b) any amounts (other than Basic Rent or Termination Value) payable
under any Operative Agreement to reimburse the Owner Trustee, any Holder or any
of their respective Affiliates (including without limitation the reasonable
expenses of the Owner Trustee, the Trust Company and the Holders 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 a Holder by any transferee of such interest of
a Holder as the purchase price of such Holder's interest in the Trust Estate
(or a portion thereof);
(d) any insurance proceeds (or payments with respect to risks
self-insured or policy deductibles) under liability policies other than such
proceeds or payments payable to the Agent or any Lender;
(e) any insurance proceeds under policies maintained by the Owner Trustee
or any Holder;
(f) Transaction Expenses or other amounts, fees, disbursements or
expenses paid or payable to or for the benefit of the Owner Trustee or any
Holder;
(g) all right, title and interest of any Holder or the Owner Trustee to
any Property or any portion thereof or any other property to the extent any of
the foregoing has been released from the Liens of the Security Documents and
the Lease pursuant to the terms thereof;
(h) upon termination of the Credit Agreement pursuant to the terms
thereof, all remaining property covered by the Lease or Security Documents;
(i) all payments in respect of the Holder Yield;
(j) any payments in respect of interest to the extent attributable to
payments referred to in clauses (a) through (i) above; and
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(k) any rights of either the Owner Trustee or the Trust Company to
demand, collect, ▇▇▇ for or otherwise receive and enforce payment of any of the
foregoing amounts, provided that such rights shall not include the right to
terminate the Lease.
"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.
"Excluded Taxes" shall have the meaning given to such term in Section
11.2(b) of the Participation Agreement.
"Exculpated Persons" shall mean the Trust Company (except with respect to
the representations and warranties and the other obligations of the Trust
Company pursuant to the Operative Agreements expressly undertaken in its
individual capacity, including without limitation the representations and
warranties of the Trust Company pursuant to Section 6.1 of the Participation
Agreement, the obligations of the Trust Company pursuant to Section 8.2 of the
Participation Agreement and the obligations of the Trust Company pursuant to
the Trust Agreement), the Holders (except with respect to the obligations of
the Holders pursuant to the Participation Agreement and the Trust Agreement
expressly undertaken in their respective individual capacities), their
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 either (a) the Basic Term Expiration Date or
(b) the last day of the applicable Renewal Term; provided, in no event shall
the Expiration Date be later than the annual anniversary of the Initial Closing
Date occurring in the year 2006, unless such later date has been expressly
agreed to in writing by each of the Lessor, the Lessee, the Agent, the Lenders
and the Holders.
"Fair Market Sales Value" shall mean, with respect to the Properties,
taken as a whole, 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, such
Properties. Fair Market Sales Value shall be determined based on the assumption
that, except for purposes of Section 17 of the Lease, such Properties are 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.
"Fairchild" shall mean ▇▇▇▇▇▇▇▇▇ Semiconductor Corporation of California,
a Delaware corporation, and its successors and assigns.
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"Fairchild SNDA" shall mean that certain Subordination, Non-Disturbance and
Attornment Agreement dated as of April 23, 1999, among ▇▇▇▇▇▇▇▇▇, the Lessee,
the Owner Trustee and the Agent.
"▇▇▇▇▇▇▇▇▇ Sublease" shall mean that certain Sublease Agreement dated on or
about the applicable Property Closing Date between VSC, as sub-landlord, and
▇▇▇▇▇▇▇▇▇, as sub-tenant.
"Federal Funds Effective Rate" shall have the meaning given to such term in
the definition of ABR.
"Financing Parties" shall mean the Lessor, the Owner Trustee, in its trust
capacity, the Agent, the Holders and the Lenders.
"Fixtures" shall mean all fixtures 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.
"Force Majeure Event" shall mean any event beyond the control of the
Construction Agent, other than a Casualty or Condemnation, including without
limitation strikes or lockouts (but only when the Construction Agent is legally
prevented from securing replacement labor or materials as a result thereof),
adverse soil conditions, acts of God, adverse weather conditions, inability to
obtain labor or materials after all possible efforts have been expended by the
Construction Agent, governmental activities, civil commotion and enemy action;
but excluding any event, cause or condition that results from the Construction
Agent's financial condition.
"Form 1001" shall have the meaning specified in Section 11.2(e) of the
Participation Agreement.
"Form 4224" shall have the meaning specified in Section 11.2(e) of the
Participation Agreement.
"Funded Indebtedness" shall mean, with respect to the Lessee and its
Consolidated Subsidiaries determined in accordance with GAAP on a consolidated
basis, without duplication, (a) all obligations for borrowed money of the Lessee
or any of its Consolidated Subsidiaries, (b) all obligations of the Lessee or
any of its Consolidated Subsidiaries evidenced by bonds, debentures, notes or
similar instruments, or upon which interest payments are customarily made, (c)
all purchase money Indebtedness of the Lessee or any of its Consolidated
Subsidiaries, including without limitation the principal portion of all
obligations under Capitalized Leases, (d) the maximum amount of all standby
letters of credit issued or bankers' acceptance facilities created for the
account of the Lessee or any of its Consolidated Subsidiaries and, without
duplication, all drafts drawn thereunder (to the extent unreimbursed), (e) the
principal balance outstanding under any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing product to
which the Lessee or any of its Consolidated Subsidiaries is a party, where such
transaction is considered borrowed money indebtedness for tax purposes but is
classified as an operating lease in accordance with GAAP, (f) all Indebtedness
of another Person of the type
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referred to in clause (a) - (e) above secured by (or for which the holder of
such indebtedness has an existing right, contingent or otherwise, to be secured
by) any lien on, or payable out of the proceeds of production from, property
owned or acquired by the Lessee or any of its Consolidated Subsidiaries, whether
or not the obligations secured thereby have been assumed, (g) all Guaranty
Obligations of the Lessee or any of its Consolidated Subsidiaries with respect
to Indebtedness of the type referred to in clauses (a) - (e) above of another
Person and (h) Indebtedness of the type referred to in clauses (a) - (e) above
of any partnership or incorporated joint venture in which the Lessee or any of
its Consolidated Subsidiaries is legally obligated or has a reasonable
expectation of being liable with respect thereto.
"GAAP" shall mean generally accepted accounting principles 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 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.
"Guarantors" shall mean the various parties to the Participation Agreement
from time to time, as guarantors of the Construction Agent and the Lessee with
respect to the Operative Agreements and the Properties.
"Guaranty Obligations" shall mean, with respect to any Person, without
duplication, any obligations (other than endorsements in the ordinary course of
business of negotiable instruments for deposit or collection) guaranteeing any
Indebtedness of any other Person in any manner, whether direct or indirect, and
including without limitation any obligation, whether or not contingent, (a) to
purchase any such Indebtedness or other obligation or any property constituting
security therefor, (b) to advance or provide funds or other support for the
payment or purchase of such Indebtedness or obligation or to maintain working
capital, solvency or other balance sheet condition of such other Person
(including, without limitation, maintenance agreements, comfort letters, take or
pay arrangements, put agreements or similar agreements or arrangements) for the
benefit of the holder of Indebtedness of such other Person, (c) to lease or
purchase property, securities or services primarily for the purpose of assuring
the owner of such Indebtedness or (d) to otherwise assure or hold harmless the
owner of such Indebtedness or obligation against loss in respect thereof. The
amount of any Guaranty Obligation hereunder shall (subject to any limitations
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set forth therein) be deemed to be an amount equal to the outstanding principal
amount (or maximum principal amount, if larger) of the Indebtedness in respect
of which such Guaranty Obligation is made.
"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 Materials" shall mean any substance, material or waste defined
in or regulated under any Environmental Laws.
"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, 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.
"Holder Advance" shall mean any advance made by any Holder to the Owner
Trustee pursuant to the terms of the Trust Agreement or the Participation
Agreement.
"Holder Amount" shall mean as of any date, the aggregate amount of Holder
Advances made by each Holder to the Trust Estate pursuant to Section 2 of the
Participation Agreement and Section 3.1 of the Trust Agreement less any
payments of any Holder Advances received by the Holders pursuant to Section 3.4
of the Trust Agreement.
"Holder Commitments" shall mean $2,160,000, as such amount may be
increased or reduced from time to time in accordance with the provisions of the
Operative Agreements; provided, if there shall be more than one (1) Holder, the
Holder Commitment of each Holder shall be as set forth in Schedule I to the
Trust Agreement as such Schedule I may be amended and replaced from time to
time.
"Holder Construction Property Cost" shall mean, with respect to the
Construction Period Properties, taken as a whole, at any date of determination,
an amount equal to the outstanding Holder Advances made with respect thereto
under the Trust Agreement.
"Holder Overdue Rate" shall mean the lesser of (a) the then current rate
of Holder Yield respecting the particular amount in question plus two percent
(2%) and (b) the highest rate permitted by applicable law.
"Holder Property Cost" shall mean with respect to the Properties an amount
equal to the outstanding Holder Advances with respect thereto.
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"Holder Commitment Fee" shall have the meaning given to such term in
Section 7.4 of the Participation Agreement.
"Holder Yield" shall mean with respect to Holder Advances from time to time
either the Eurodollar Rate plus the Applicable Percentage or the ABR as elected
by the Owner Trustee from time to time with respect to such Holder Advances in
accordance with the terms of the Trust Agreement; provided, however, (a) upon
delivery of the notice described in Section 3.7(c) of the Trust Agreement, the
outstanding Holder Advances of each Holder shall bear yield at the ABR
applicable from time to time from and after the dates and during the periods
specified in Section 3.7(c) of the Trust Agreement, and (b) upon the delivery by
a Holder of the notice described in Section 11.3(f) of the Participation
Agreement, the Holder Advances of such Holder shall bear a yield at the ABR
applicable from time to time after the dates and during the periods specified in
Section 11.3(f) of the Participation Agreement.
"Holders" shall mean NationsBank, N.A. and shall include the other banks
and financial institutions which may be from time to time holders of
Certificates in connection with the VS Trust 1999-1.
"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 ("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 any 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 in each case all interest, additions to tax and penalties thereon,
which at any time prior to, during or with respect to the Term or in respect of
any period for which the Lessee shall be obligated to pay Supplemental Rent, may
be levied, assessed or imposed by any Governmental Authority upon or with
respect to (a) any Property or any part thereof or interest therein; (b) the
leasing, financing, refinancing, demolition, construction, substitution,
subleasing, assignment, control, condition, occupancy, servicing, maintenance,
repair, ownership, possession, activity conducted on, delivery, insuring, use,
operation, improvement, sale, transfer of title, return or other disposition of
such Property or any part thereof or interest therein; (c) the Notes, other
indebtedness with respect to any Property, or the Certificates, or any part
thereof or interest therein; (d) the rentals, receipts or earnings arising from
any Property or any part thereof or interest therein; (e) the Operative
Agreements, the performance thereof, or any payment made or accrued pursuant
thereto; (f) the income or other proceeds received with respect to any Property
or any part thereof or interest therein upon the sale of disposition thereof;
(g) any
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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 or the Certificates; (i) the Owner
Trustee, the Trust or the Trust Estate; 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 of any 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 purchased or otherwise acquired using the proceeds of the Loans
or the Holder Advances, 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 Property Closing Date as such Improvements may be referenced
on the applicable Requisition and (b) any Improvements made subsequent to such
Property Closing Date.
"Indebtedness" of a Person shall mean, without duplication, such
Person's:
(a) obligations for borrowed money;
(b) obligations representing the deferred purchase price of Property
(whether real, personal, tangible, intangible or mixed) or services (other
than accounts payable arising in the ordinary course of such Person's
business payable on terms customary in the trade);
(c) obligations, whether or not assumed, secured by liens or payable
out of the proceeds or production from property now or hereafter owned or
acquired by such Person;
(d) obligations which are evidenced by notes, acceptances or other
instruments;
(e) Capitalized Lease obligations;
(f) net liabilities under interest rate swap, exchange or cap
agreements; and
(g) contingent obligations;
(h) all obligations of such Person evidenced by bonds, debentures,
notes or similar instruments, or upon which interest payments are
customarily made;
(i) all Guaranty Obligations of such Person with respect to
Indebtedness of another Person (obligations of a Person under an Operating
Lease shall not be considered Indebtedness);
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(j) the maximum amount of all standby letters of credit issued or
bankers' acceptances facilities created for account of such Person and,
without duplication, all drafts drawn thereunder (to the extent
unreimbursed);
(k) all preferred Capital Stock issued by such Person and which by
the terms thereof could be (at the request of the holders thereof or
otherwise) subject to mandatory sinking fund payments, redemption or other
acceleration; and
(l) the principal portion of all obligations of such Person under any
synthetic, tax retention operating lease, off-balance sheet loan or similar
off-balance sheet financing product of such Person where such transaction
is considered borrowed money indebtedness for tax but is classified as an
operating lease in accordance with GAAP.
"Indemnified Person" shall mean the Lessor, the Owner Trustee, in its
individual and its trust capacity, the Trust, the Trust Company, the Agent, the
Holders, the Lenders and their respective successors, assigns, directors,
shareholders, partners, officers, employees, agents and Affiliates.
"Indemnity Agreement" shall mean that certain Environmental Indemnity
Agreement dated on or about the applicable Property Closing Date between VSC
and ▇▇▇▇▇▇▇▇▇ and that certain Grant of Easements, Restriction and Indemnity
Agreement dated as of December 24, 1997 executed by Raytheon Semiconductor,
Inc., as grantor, in favor of Raytheon, together with its successors in title,
as grantee.
"Indemnity Provider" shall mean, respecting each Property, the Lessee.
"Initial Closing Date" shall mean April 23, 1999.
"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 any Property which is required to be restored or
repaired 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 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.
"Interest Expense" shall mean for any period, with respect to the Credit
Parties and their Consolidated Subsidiaries on a consolidated basis, all
interest expense, including the interest component under Capitalized Leases, as
determined in accordance with GAAP.
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"Interest Period" shall mean (a) during the Commitment Period and
thereafter as to any Eurodollar Loan or Eurodollar Holder Advance (i) with
respect to the initial Interest Period, the period beginning on the date of the
first Eurodollar Loan and Eurodollar Holder Advance and ending one (1) month,
two (2) months, three (3) months or six (6) months thereafter, as selected by
the Lessor (in the case of a Eurodollar Loan) or the Owner Trustee (in the case
of a Eurodollar Holder Advance) 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 or Eurodollar
Holder Advance and ending one (1) month, two (2) months, three (3) months or six
(6) months thereafter, as selected by the Lessor by irrevocable notice to the
Agent (in the case of a Eurodollar Loan) or by the Owner Trustee (in the case of
a Eurodollar Holder Advance) 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 Maturity Date or 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.
"Investment" means (a) the acquisition (whether for cash, property,
services, assumption of Indebtedness, securities or otherwise) of assets,
Capital Stock, bonds, notes, debentures, partnership, joint ventures or other
ownership interests or other securities of any Person or (b) any deposit with,
or advance, loan or other extension of credit to, any Person (other than
deposits made in connection with the purchase of equipment or other assets in
the ordinary course of business) or (c) any other capital contribution to or
investment in any Person, including, without limitation, any Guaranty
Obligations (including any support for a letter of credit issued on behalf of
such Person) incurred for the benefit of such Person.
"Investment Company Act" shall mean the Investment Company Act of 1940, as
amended, together with the rules and regulations promulgated thereunder.
"Joinder Agreement" shall mean a joinder agreement, in the form of Exhibit
K to the Participation Agreement, executed from time to time between the Parent
or a Domestic Subsidiary of any Credit Party and the Agent.
"Joinder of Lessee" shall mean that certain joinder dated as of April 23,
1999, executed by the Lessee, as grantor, in favor of the Agent, as beneficiary,
attached to and made a part of that certain deed of trust dated as of such date,
executed by the Owner Trustee, as grantor, in favor of the Agent, as
beneficiary.
"Land" shall mean a parcel of real property described on (a) the
Requisition issued by the Construction Agent on the Property Closing Date
relating to such parcel and (b) the schedules to
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each applicable Lease Supplement executed and delivered in accordance with the
requirements of Section 2.4 of the Lease.
"Land Cost" shall mean one hundred percent (100%) of the cost of the Land
for all, but not less than all, the Properties.
"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 Master Lease Agreement dated
on or about the Initial Closing Date, between the Lessor and the Lessee,
together with any Lease Supplements 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 each 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 Owner Trustee, any
Holder, the Lessor, any Credit Party, the Agent, any Lender or any Property,
Land, Improvement, Equipment or the taxation, demolition, construction, use or
alteration of such Improvements, whether now or hereafter enacted and in force,
including without limitation any that require repairs, modifications or
alterations in or to any 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. Section 12101 et. seq.,
and any other similar federal, state or local laws or ordinances and the
regulations promulgated thereunder) and any that may relate to environmental
requirements (including 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 any Property or the Appurtenant Rights.
"Lender Commitments" shall mean $69,840,000, as such amount may be
increased or reduced from time to time in accordance with the provisions of the
Operative Agreements; provided, if there shall be more than one (1) Lender, the
Lender Commitment of each Lender shall be 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.
"Lender 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.
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"Lender Commitment Fee" shall have the meaning given to such term in
Section 7.4 of the Participation Agreement.
"Lenders" shall mean NationsBank, N.A. and shall include the other banks
and financial institutions which may be from time to time party to the
Participation Agreement and the Credit Agreement.
"Lessee" shall have the meaning set forth in the Lease.
"Lessor" shall mean the Owner Trustee, not in its individual capacity, but
as the Lessor under the Lease.
"Lessor Basic Rent" shall mean the scheduled Holder Yield due on the
Holder Advances on any Scheduled Interest Payment Date pursuant to the Trust
Agreement (but not including interest on (a) any such scheduled Holder Yield
due on the Holder Advances prior to the Rent Commencement Date with respect to
the Property to which such Holder Advances relate or (b) overdue amounts under
the Trust Agreement or otherwise).
"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 or the Trust
Company, in its individual capacity, not resulting from the transactions
contemplated by the Operative Agreements, (b) any act or omission of the Lessor
or the Trust Company, in its individual capacity, which is not required by the
Operative Agreements or is in violation of any of the terms of the Operative
Agreements, (c) any claim against the Lessor or the Trust Company, in its
individual capacity, with respect to Taxes or Transaction Expenses against
which the Lessee is not required to indemnify the Lessor or the Trust Company,
in its individual capacity, 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
Properties, the Trust Estate or the Operative Agreements other than the
transfer of title to or possession of any Properties by the Lessor pursuant to
and in accordance with the Lease, the Credit Agreement, the Security Agreement
or the Participation Agreement or pursuant to the exercise of the remedies set
forth in Article XVII of the Lease.
"Leverage Ratio" shall mean, as of the end of each fiscal quarter of the
Lessee, with respect to the Credit Parties and their Consolidated Subsidiaries
on a consolidated basis, the ratio of (a) Funded Indebtedness minus
Subordinated Debt on such date to (b) EBITDA for the twelve month period ending
on such date.
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"Lien" shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, security interest, encumbrance, lien (statutory or
otherwise), preference, priority or charge of any kind, including, without
limitation, any agreement to give any of the foregoing, any conditional sale or
other title retention agreement, and any lease in the nature thereof.
"Limited Recourse Amount" shall mean with respect to all the Properties
on an aggregate basis, an amount equal to the sum of the Termination Values with
respect to all the Properties on an aggregate basis on each Payment Date, less
the Maximum Residual Guarantee Amount as of such date with respect to all the
Properties on an aggregate basis.
"Loan Basic Rent" shall mean the scheduled interest due on the Loans on
any Scheduled Interest Payment Date pursuant to the Credit Agreement (but not
including interest on (a) any such Loan due prior to the Rent Commencement Date
with respect to the Property to which such Loan relates or (b) any overdue
amounts under Section 2.8(b) of the Credit Agreement or otherwise).
"Loan Property Cost" shall mean, with respect to the Properties, taken as
a whole, at any date of determination, an amount qual to (a) the aggregate
principal amount all Loans (including without limitation all Acquisition Loans
and Construction Loans) made on or prior to such date with respect to such
Properties minus (b) the aggregate amount of prepayments or repayments as the
case may be of the Loans allocated to reduce the Loan Property Cost of such
Properties pursuant to Section 2.6(c) of the Credit Agreement.
"Loans" shall mean the loans extended pursuant to the Credit Agreement
and shall include both the Tranche A Loans and the Tranche B Loans.
"Majority Holders" shall mean at any time, Holders whose Holder Advances
outstanding represent at least fifty-one percent (51%) of (a) the aggregate
Holder Advances outstanding or (b) to the extent there are no Holder Advances
outstanding, the aggregate Holder Commitments.
"Majority Lenders" shall mean at any time, Lenders whose Loans
outstanding represent at least fifty-one percent (51%) of (a) the aggregate
Loans outstanding or (b) to the extent there are no Loans outstanding, the
aggregate of the Lender Commitments.
"Majority Secured Parties" shall mean at any time, Lenders and Holders
whose Loans and Holder Advances outstanding represent at least fifty-one percent
(51%) of (a) the aggregate Advances outstanding or (b) to the extent there are
no Advances outstanding, the sum of the aggregate Holder Commitments plus the
aggregate Lender Commitments; provided, however, any amendment to Section
8.3(A)(h)(ii) shall require the consent of Lenders and Holders whose Loans and
Holder Advances outstanding represent at least sixty-six and two-thirds percent
(66 2/3%) of (x) the aggregate Advances outstanding or (y) to the extent there
are no Advances outstanding, the sum of the aggregate Holder Commitments plus
the aggregate Lender Commitments.
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"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.
"Material Adverse Effect" shall mean any event, circumstance, occurrence,
fact, condition or change materially adversely affecting (a) the acquisition,
construction, equipping, financing, operation, maintenance, leasing, ownership,
use or regulatory status of any Property, (b) the business, assets, properties,
financial condition, operations, prospects or rights or interests of the Credit
Parties, on a consolidated basis, which individually or in the aggregate has
caused directly or indirectly Net Income for any fiscal quarter (plus, within
four years of the closing of the Reorganization, to the extent deducted in the
determination of Net Income for such fiscal quarter (x) non-cash charges taken
in such fiscal quarter in connection with the Reorganization and (y) the
write-down of goodwill taken in such fiscal quarter in connection with the
Reorganization) to be less than zero, (c) the value, utility or useful life of
any Property or the use, or ability of the Lessee to use, any Property for the
purpose for which it was intended, (d) the validity or enforceability of any
Operative Agreements or the rights and remedies of the Agent, the Lenders, the
Holders or the Lessor thereunder or (e) the validity, priority or
enforceability of any Lien on any Property created by any of the Operative
Agreements.
"Material Default" shall mean any Default under Sections 17.1(a), (b),
(g), (h), (i), (j) or (l)(i) of the Lease.
"Maturity Date" shall mean the Expiration Date.
"Maximum Amount" shall mean (a) the Land Cost, plus (b) the product of
eighty-nine and nine tenths percent (89.9%) multiplied by the following: (the
aggregate Termination Value for all, but not less than all, the Properties,
minus the Land Cost, minus all structuring fees payable in connection with the
transactions evidenced by the Operative Agreements to NationsBanc ▇▇▇▇▇▇▇▇▇▇
Securities LLC, NationsBank, N.A. and/or any Affiliates of either of the
foregoing, minus accrued, unpaid Holder Yield respecting any and all
Construction Period Properties) minus (c) the accreted value (calculated at a
rate of six and one-half percent (6.50%) per annum) of any payments previously
made by the Construction Agent or the Lessee regarding any and all Construction
Period Properties and not reimbursed.
"Maximum Residual Guarantee Amount" shall mean (i) with respect to the
Property constituting the Land, an amount equal to the Land Cost and (ii) with
respect to the Property constituting the Improvements on the Land, the product
of the aggregate Property Cost for all of the Properties (exclusive of the
Land Cost) times eighty-four percent (84%), in each case as set forth in the
applicable Lease Supplement.
"Merger Sub" shall mean the newly formed, wholly owned subsidiary of the
Parent formed in connection with the Reorganization.
"Modifications" shall have the meaning specified in Section 11.1(a) of the
Lease.
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"Mortgage Instrument" shall mean any mortgage, deed of trust or any other
instrument executed by the Owner Trustee and/or the Lessee in favor of the
Agent (for the benefit of the Lenders and the Holders) (including, without
limitation, the Joinder of Lessee), and evidencing a Lien on the Property, in
form and substance reasonably acceptable to the Agent.
"Multiemployer Plan" shall mean a Plan covered by Title IV of ERISA which
is a multiemployer plan as defined in Section 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" shall mean a Plan covered by Title IV of ERISA,
other than a Multiemployer Plan, which any Credit Party or any of its
Subsidiaries or any ERISA Affiliate and at least one employer other than a
Credit Party or any of its Subsidiaries or any ERISA Affiliate are contributing
sponsors.
"Net Income" shall mean for any period, the net income after taxes for
such period of the Credit Parties and their Consolidated Subsidiaries on a
consolidated basis, as determined in accordance with GAAP.
"New Facility" shall have the meaning given to such term in Section 28.1
of the Lease.
"Non-Integral Equipment" shall mean Equipment which (a) is personal
property that is readily removable without causing material damage to the
applicable Property and (b) is not integral or necessary, respecting the
applicable Property, for compliance with Section 8.3 of the Lease or otherwise
to the structure thereof, the mechanical operation thereof, the electrical
systems thereof or otherwise with respect to any aspect of the physical plant
thereof.
"Notes" shall mean those notes issued to the Lenders pursuant to the
Credit Agreement and shall include both the Tranche A Notes and the Tranche B
Notes.
"NSMG" shall mean Seagate Software Network & Storage Management Group,
Inc., a Delaware corporation.
"NSMG Business" shall mean the business of the network software management
group of SSI as set forth in the Reorganization Agreement.
"Obligations" shall have the meaning given to such term in Section 1 of
the Security Agreement.
"Officer's Certificate" with respect to any person shall mean a
certificate executed on behalf of such person by a Responsible Officer who has
made or caused to be made such examination or investigation as is necessary to
enable such Responsible Officer to express an informed opinion with respect to
the subject matter of such Officer's Certificate.
"Operating Lease" shall mean, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the lessee
at any time) of any Property (whether real,
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personal or mixed) which is not a Capitalized Lease other than any such lease
in which that Person is the lessor.
"Operative Agreements" shall mean the following: the Participation
Agreement, the Agency Agreements, the Trust Agreement, the Certificates, the
Credit Agreement, the Notes, the Lease, the Lease Supplements (and memoranda of
the Lease and each Lease supplement in a form reasonably acceptable to the
Agent), the ▇▇▇▇▇▇▇▇▇ Sublease, the Collateral Assignment of Sublease, the
Joinder Agreements, the Security Agreement, the Mortgage Instruments, the other
Security Documents, the Deeds and Bills of Sale, the Veritas SNDA, the ▇▇▇▇▇▇▇▇▇
SNDA, the Purchase Agreement, the Purchase Agreement Assignment, the Indemnity
Agreements, the Raytheon Indemnity Assignment and any and all other agreements,
documents and instruments executed in connection with any of the foregoing.
"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 the Loan Basic Rent, and any
other amount owed or with respect to the Credit Agreement or the Security
Documents, the rate specified in Section 2.8(b) of the Credit Agreement, (b)
with respect to the Lessor Basic Rent, the Holder Yield and any other amount
owed under or with respect to the Trust Agreement, the Holder Overdue Rate, and
(c) with respect to any other amount, the amount referred to in clause (y) of
Section 2.8(b) of the Credit Agreement.
"Owner Trustee," "Borrower" or "Lessor" shall mean First Security Bank,
National Association, not individually, except as expressly stated in the
various Operative Agreements, but solely as the Owner Trustee under the VS
Trust 1999-1, and any successor, replacement and/or additional Owner Trustee
expressly permitted under the Operative Agreements.
"Parcel Sale Requirements" shall have the meaning given to such term in
Section 20.1 of the Lease.
"Parent" shall mean Veritas Holding 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 on
or about the Initial Closing Date, among the Lessee, the Guarantors, the owner
Trustee, not in its individual capacity except as expressly stated therein, the
Holders, the Lenders and the Agent.
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"Payment Date" shall mean any Scheduled Interest Payment Date and any date
on which interest or Holder Yield in connection with a prepayment of principal
on the Loans or of the Holder Advances is due under the Credit Agreement or the
Trust Agreement.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and 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 Acquisition" shall mean a statutory merger, the acquisition of
all of the Capital Stock of another Person or all or substantially all of the
assets of another Person, provided that each of the following conditions are
satisfied: (a) prior to such acquisition, the Lessee shall deliver to the Agent
and the Majority Secured Parties a Pro Forma Compliance Certificate
demonstrating that after giving effect to such acquisition on a pro forma
basis, as if such acquisition had occurred on the first day of the twelve month
period ending on the last day of the Lessee's most recently completed fiscal
year, the Credit Parties would have been in compliance with all the financial
covenants set forth in Section 8.3A(b), (b) the acquisition is consummated
pursuant to a negotiated acquisition agreement and involves the purchase of a
business similar to the business of the Lessee as of the Initial Closing Date,
(c) after giving effect to the acquisition, the representations and warranties
set forth in Section 6 hereof shall be true and correct in all material
respects on and as of the date of such acquisition with the same effect as
though made on and as of such date and (d) no Default or Event of Default
exists and is continuing or would result from such acquisition.
"Permitted Facility" shall mean a Class A office building to be used and
operated by the Lessee in its ordinary course of business as of the Initial
Closing Date.
"Permitted Investments" shall mean Investments which are (i) cash and Cash
Equivalents; (ii) accounts receivable created, acquired or made by the Lessee
or any of its Consolidated Subsidiaries in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms; (iii)
Investments consisting of Capital Stock, obligations, securities or other
property received by the Lessee or any of its Consolidated Subsidiaries in
settlement of accounts receivable (created in the ordinary course of business)
from bankrupt obligors; (iv) Investments existing as of the Closing Date and
set forth in Schedule 8.3B(f); (vi) advances or loans to directors, officers,
employees, agents, customers or suppliers that do not exceed $5,000,000 in the
aggregate at any one time outstanding for the Lessee and its Consolidated
Subsidiaries; and (vii) Permitted Acquisitions.
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"Permitted Liens" shall mean:
(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 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 or permitted under Section 8.5 of the Participation Agreement;
(h) Liens and other matters set forth as exceptions on the title
commitment issued under Section 5.3(g) with respect to a particular Property,
to the extent such title commitment has been approved by the Agent; and
(i) Such other additional matters as may be approved in writing by Lessor.
"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.
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"Plan" shall mean any employee benefit plan (as defined in Section 3(3) of
ERISA) which is covered by ERISA and with respect to which the Lessee or any of
its Consolidated Subsidiaries or any ERISA Affiliate is (or, if such plan were
terminated at such time, would under Section 4069 of ERISA be deemed to be) an
"employer" within the meaning of Section 3(5) of ERISA.
"Plans and Specifications" shall mean, with respect to Improvements, the
plans and specifications for such Improvements to be constructed or already
existing, as such Plans and Specifications may be amended, modified or
supplemented from time to time in accordance with the terms of the Operative
Agreements.
"Pre-Existing Environmental Condition" shall have the meaning given to
such term in Section 15.2(b) of the Lease.
"Pre-Existing Hazardous Substances" shall have the meaning given to such
term in Section 15.2(a) of the Lease.
"Prime Lending Rate" shall have the meaning given to such term in the
definition of ABR.
"Pro Forma Compliance Certificate" shall mean a certificate of the chief
financial officer of the Lessee delivered to the Agent in connection with any
Permitted Acquisition and containing reasonably detailed calculations, upon
giving effect to the applicable transaction on a pro forma basis, of the
financial covenants set forth in Section 8.3A(h).
"Property" shall mean the Land and/or each item of Equipment and the
various Improvements in each case as more particularly described on any
applicable Lease Supplement, including without limitation each Construction
Period Property and each Property for which the Basic Term has commenced. For
purposes of Sections 8.3A and 8.3B of the Participation Agreement only, the
term "Property" shall mean any interest in any kind of property or asset,
whatever real, personal or mixed, or tangible or intangible.
"Property Acquisition Cost" shall mean the cost to the Lessor to purchase
a Property on a Property Closing Date.
"Property Closing Date" shall mean the date on which the Lessor purchases a
Property or, with respect to the first Advance, the date on which the Lessor
seeks reimbursement for Property previously purchased by the Lessor.
"Property Cost" shall mean with respect to the Properties the aggregate
amount (and/or the various items and occurrences giving rise to such amounts) of
the Loan Property Cost plus the Holder Property Cost for such Property (as such
amounts shall be increased equally among all Properties respecting the Holder
Advances and the Loans extended from time to time to pay for the Transaction
Expenses and indemnity payments pursuant to Section 11.8, in each case of the
Participation Agreement).
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"Purchase Agreement" shall mean that certain Agreement of Purchase and
Sale dated as of March 29, 1999 between ▇▇▇▇▇▇▇▇▇, as seller, and VSC, as
purchaser.
"Purchase Agreement Assignment" shall mean that certain Assignment of
Purchase Agreement dated on or about the applicable Property Closing Date
between VSC and the Owner Trustee.
"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.
"Quick Ratio" shall mean, with respect to the Credit Parties and their
Consolidated Subsidiaries on a consolidated basis as of the last day of any
fiscal quarter, the ratio of (a) the sum of (i) cash and Cash Equivalents on
such date plus (ii) the aggregate book value of all accounts receivable on such
date to (b) the sum of (i) current liabilities on such date, as determined in
accordance with GAAP plus (ii) Operating Lease commitments on such date, as
determined in accordance with GAAP plus (iii) the principal balance outstanding
of the Indebtedness permitted under Section 8.3B(a)(iv) on such date.
"Raytheon" shall mean Raytheon Company, a Delaware corporation and its
successors and assigns.
"Raytheon Indemnity Assignment" shall mean that certain Assignment dated
as of April 23, 1999 and executed by ▇▇▇▇▇▇▇▇▇ in favor of the Owner Trustee.
"Real Properties" shall mean the real properties that the Lessee or any
Consolidated Subsidiary may own or lease (as lessee or sublessee) from third
parties from time to time.
"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 of Governors of the
Federal Reserve System (or any successor), as the same may be modified and
supplemented and in effect from time to time.
"Release" shall mean any release, pumping, pouring, emptying, injecting,
escaping, leaching, dumping, seepage, spill, leak, flow, discharge, disposal
or emission of a Hazardous Substance.
"Renewal Term" shall have the meaning specified in Section 2.2 of the
Lease.
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"Rent" shall mean, collectively, the Basic Rent and the Supplemental Rent,
in each case payable under the Lease.
"Rent Commencement Date" shall mean the final Completion Date for all
Properties in the aggregate.
"Reorganization" shall mean that certain plan of reorganization described
in Section 1 of the Reorganization Agreement whereby (i) the Lessee will become
a Wholly Owned Subsidiary of the Parent and each share of Capital Stock of the
Lessee will be converted into one share of Capital Stock of the Parent and (ii)
each of the Contributed Companies shall have become a Wholly-Owned Subsidiary
of the Parent.
"Reorganization Agreement" shall mean that certain Agreement and Plan of
Reorganization dated as of October 5, 1998 by and among Veritas Software
Corporation (including for all purposes Veritas Surviving Corporation), the
Parent, Seagate Technology, Inc., SSI and Seagate Software Network & Storage
Management Group, Inc.
"Reportable Event" shall have the meaning specified in ERISA.
"Reportable Event" shall mean a "reportable event" as defined in Section
4043 of ERISA with respect to which the notice requirements to the PBGC have
not been waived.
"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 Chairman or Vice Chairman of the Executive Committee of
the Board of Directors, the President, any Senior Vice President or Executive
Vice President, any Vice President, the Secretary, any Assistant Secretary, the
Treasurer, or any Assistant Treasurer, except that when used with respect to
the Trust Company or the Owner Trustee, "Responsible Officer" shall also include
the Cashier, any Assistant Cashier, any Trust Officer or Assistant Trust
Officer, the Controller and any Assistant Controller or any other officer of
the Trust Company or the Owner Trustee customarily performing functions similar
to those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of his knowledge of and familiarity with the
particular subject.
"Restricted Payment" means (i) any dividend or other payment or
distribution, direct or indirect, on account of any shares of any class of
Capital Stock of the Lessee or any of its Consolidated Subsidiaries, now or
hereafter outstanding (including without limitation any payment in connection
with any dissolution, merger, consolidation or disposition involving the Lessee
or any of its Consolidated Subsidiaries), or to the holders, in their capacity
as such, of any shares of
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any class of Capital Stock of the Lessee or any of its Consolidated
Subsidiaries, now or hereafter outstanding, (ii) any redemption, retirement,
sinking fund or similar payment, purchase or other acquisition for value, direct
or indirect, of any shares of any class of Capital Stock of the Lessee or any of
its Consolidated Subsidiaries, now or hereafter, outstanding and (iii) any
payment made to retire, or to obtain the surrender of, any outstanding warrants,
options or other rights to acquire shares of any class of Capital Stock of the
Lessee or any of its Consolidated Subsidiaries, now or hereafter outstanding.
"RI/FS" shall have the meaning given to such term in Section 15.2(a) of the
Lease.
"ROD" shall have the meaning given to such term in Section 15.2(a) of the
Lease.
"Sale Date" shall have the meaning given to such term in Section 22.1(a) of
the Lease.
"Sale Notice" shall mean a notice given to the Lessor 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 Properties if it has been determined that the Fair
Market Sales Value of the Properties at the expiration of the term of the Lease
has been impaired by greater than ordinary wear and tear during the Term of the
Lease.
"Scheduled Interest Payment Date" shall mean (a) as to any Eurodollar Loan
or Eurodollar Holder Advance, the last day of the Interest Period applicable to
such Eurodollar Loan or Eurodollar Holder Advance, (except that with respect to
any Eurodollar Loan having an Interest Period of six (6) months or any
Eurodollar Holder Advance with Holder Yield calculated on the basis of six (6)
month Eurodollar Rate, the term "Scheduled Interest Payment Date" shall mean
each applicable three (3) month anniversary date of such Eurodollar Loan or
Eurodollar Holder Advance) (b) as to any ABR Loan or any ABR Holder Advance, the
fifteenth date 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 Loans and Holder
Advances, the date of any voluntary or involuntary payment, prepayment, return
or redemption, and the Maturity Date or the Expiration Date, as the case may
be.
"Secured Parties" shall have the meaning given to such term in the Security
Agreement.
"Securities Act" shall mean the Securities Act of 1993, as amended,
together with the rules and regulations promulgated thereunder.
"Security Agreement" shall mean the Security Agreement dated on or about
the Initial Closing Date between the Lessor and the Agent, for the benefit of
the Secured Parties, and accepted and agreed to by the Lessee.
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"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 Credit Agreement and/or under any of the other Credit Documents or to
secure any guarantee of any such obligations and liabilities.
"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 Properties 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 Lender Unused Fee, the
Holder Unused Fee, fees and expenses of the Owner Trustee 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.
"SSI" shall mean Seagate Software, Inc., a Delaware corporation.
"Subordinated Debt" shall mean the $100,000,000 5 1/4% Convertible
Subordinated Notes due November 1, 2004 issued by the Lessee pursuant to that
certain Indenture dated on or about October 1, 1997 between the Lessee and State
Street Bank and Trust Company of California, N.A., as trustee.
"Subsidiary" shall mean, as to any Person, any corporation of which at
least a majority of the outstanding stock having by the terms thereof ordinary
voting power to elect a majority of the board of directors of such corporation
(irrespective of whether or not at the time stock of any other class or classes
of such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person, or by one (1)
or more Subsidiaries, or by such Person and one (1) or more Subsidiaries.
"Supplemental Amounts" shall have the meaning given to such term in Section
9.18 of the Credit Agreement.
"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 Trust Company, the Holders, the Agent, the Lenders or any other Person under
the Lease or under any of the other Operative Agreements including without
limitation payments of the Termination Value and the Maximum Residual Guarantee
Amount and all indemnification amounts, liabilities and obligations.
"Survey" shall mean that certain Survey of the Lands of Raytheon Company
dated as of November 21, 1997 and revised as of December 22, 1997, prepared by
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, and approved by the Agent.
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"Taxes" shall have the meaning specified in the definition of
"Impositions".
"TCE" shall have the meaning given to such term in Section 15.2(a) of the
Lease.
"Term" shall mean the Basic Term and each Renewal Term, if any.
"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) any of (i) with respect to
all Properties, an amount equal to the aggregate outstanding Property Cost for
all the Properties, in each case as of the last occurring Payment Date, or (ii)
with respect to a particular Property, an amount equal to the Property Cost
allocable to such Property, or (iii) with respect to any portion of any Property
for which Lessee has provided a notice of its desire to purchase such portion of
such Property pursuant to Section 20.1 of the Lease, an amount equal to the pro
rata portion of the Property Cost for such Property allocable to such portion of
such Property plus (b) respecting the amounts described in each of the foregoing
subclause (i), (ii) or (iii), as applicable, any and all accrued but unpaid
interest on the Loans and any and all Holder Yield on the Holder Advances
related to the applicable Property Cost, plus (c) to the extent the same is not
duplicative of the amounts payable under clause (b) 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).
"Tranche A Commitments" shall mean the obligation of the Tranche A Lenders
to make the Tranche A Loans to the Lessor in an aggregate principal amount at
any one (1) time outstanding not to exceed the aggregate of the amounts set
forth opposite each Tranche A 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
A Lender shall be obligated to make Tranche A Loans in excess of such Tranche A
Lender's share of the Tranche A Commitments as set forth adjacent to such
Tranche A Lender's name on Schedule 2.1 to Credit Agreement.
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"Tranche A Lenders" shall mean NationsBank, N.A. 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 A Loans.
"Tranche A Loans" shall mean the Loans made pursuant to the Tranche A
Commitment.
"Tranche A Note" shall have the meaning given to it in Section 2.2 of the
Credit Agreement.
"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 (1) 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 Credit Agreement.
"Tranche B Lenders" shall mean NationsBank, N.A. 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 Note" shall have the meaning given to it in Section 2.2 of the
Credit Agreement.
"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 7.1 of the Participation Agreement and the following:
(a) the reasonable fees, out-of-pocket expenses and disbursements of
counsel in negotiating the terms of the Operative Agreements and the other
transaction documents, preparing for the closings under, and rendering
opinions in connection with, such transactions and in rendering other
services customary for counsel representing parties to transactions of the
types involved in the transactions contemplated by the Operative
Agreements;
(b) 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;
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(c) any and all other reasonable fees, charges or other amounts
payable to the Lenders, the Agent, the Holders, the Owner Trustee
or any broker which arises under any of the Operative Agreements;
(d) any other reasonable fee, out-of-pocket expenses, disbursement or
cost of any party to the Operative Agreements or any of the other
transaction documents; 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
Agreement.
"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.
"Trust" shall mean the VS Trust 1999-1.
"Trust Agreement" shall mean the Trust Agreement dated on or about the
Initial Closing Date between the Holders and the Owner Trustee.
"Trust Company" shall mean First Security Bank, National Association, in
its individual capacity, and any successor owner trustee under the Trust
Agreement in its individual capacity.
"Trust Estate" shall have the meaning specified in Section 2.2 of the
Trust Agreement.
"Type" shall mean, as to any Loan, whether it is an ABR Loan or a
Eurodollar Loan.
"UCC Financing Statements" shall mean collectively the Lender Financing
Statements and the Lessor Financing Statements.
"Unanimous Vote Matters" shall have the meaning given it in Section 12.4
of the Participation Agreement.
"Unfunded Amount" shall have the meaning specified in Section 3.2 of the
Agency Agreement.
"Unfunded Liability" shall mean, with respect to any Plan, at any time,
the amount (if any) by which (a) the present value of all 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 Company or any member of the Controlled Group to the PBGC or such Plan
under Title IV of ERISA.
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"Uniform Commercial Code" and "UCC" shall mean the Uniform Commercial Code
as in effect in any applicable jurisdiction.
"United States Bankruptcy Code" shall mean Title 11 of the United States
Code.
"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.
"Veritas SNDA" shall mean that certain Subordination, Non-Disturbance and
Attornment Agreement dated as of April 23, 1999 among the Agent, the Owner
Trustee and the Lessee.
"VSC" shall mean Veritas Software Corporation, a Delaware corporation, and
its successors and permitted assigns.
"VS Trust 1999-1" shall mean the grantor trust created pursuant to the
terms and conditions of the Trust Agreement.
"Wholly Owned Subsidiary" of any Person shall mean any Subsidiary 100% of
whose voting stock or other equity interests is at the time owned by such
Person directly or indirectly through other Wholly Owned Subsidiaries.
"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
any Property.
"Year 2000 Compliant" shall have the meaning specified in Section 6.2(v)
of the Participation Agreement.
"Year 2000 Problem" shall mean the risk that computer applications used by
any Credit Party or any of its Subsidiaries or any supplier, vendor or customer
of any Credit Party or any of its Subsidiaries may be unable to recognize and
perform properly date-sensitive functions involving certain dates prior to and
any date after December 31, 1999.
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