EXHIBIT 10(i)
_____________________________________________________________
PARTICIPATION AGREEMENT
dated as of October 31, 1995
among
FERRO CORPORATION,
STATE STREET BANK AND TRUST COMPANY
not in its individual capacity except as
expressly stated herein, but solely as Trustee,
THE FINANCIAL INSTITUTIONS NAMED HEREIN,
as Purchasers
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and
CITIBANK, N.A.,
as Agent
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__________________________________________________________________
TABLE OF CONTENTS
Page
Preliminary Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE I. FINANCING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 1.01. Agreement to Issue and Purchase . . . . . . . . . . . . . .
SECTION 1.02. Financing Closing Date . . . . . . . . . . . . . . . . . .
SECTION 1.03. Simultaneous Financing Closing
Transactions
SECTION 1.04. Procedures for Fundings
Requisitions . . . . . . . . . . . . . . . . . . . . . .
SECTION 1.05. Commitment Reduction . . . . . . . . . . . . . . . . . . .
SECTION 1.06. Equipment Sale Options . . . . . . . . . . . . . . . . . .
ARTICLE II. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 2.01. Conditions Precedent to the
Financing Closing . . . . . . . . . . . . . . . . . . . .
SECTION 2.02. Conditions Precedent to Funding
Subsequent to the Financing
Closing . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 2.03. Obligations Subsequent . . . . . . . . . . . . . . . . . .
ARTICLE III. REFINANCING OF NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 3.01. Refinancing of Interim Notes . . . . . . . . . . . . . . .
SECTION 3.02. Conditions Precedent to Final
Completion Date
ARTICLE IV. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 4.01. Company Representations and
Warranties . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 4.02. SSBTC Representations and
Warranties
ARTICLE V. COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 5.01. Company's Covenants . . . . . . . . . . . . . . . . . . . .
ARTICLE VI. THE NOTES AND THE CERTIFICATES . . . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 6.01. Determination of Rates . . . . . . . . . . . . . . . . . .
SECTION 6.02. Assignments and Participations . . . . . . . . . . . . . .
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SECTION 6.03. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 6.04. Substitution of Purchaser . . . . . . . . . . . . . . . .
SECTION 6.05. Sharing of Payments, Etc. . . . . . . . . . . . . . . . .
SECTION 6.06. Tax Treatment . . . . . . . . . . . . . . . . . . . . . .
ARTICLE VII. EVENTS OF DEFAULT AND UNWIND EVENTS . . . . . . . . . . . . . . .
SECTION 7.01. Events of Default . . . . . . . . . . . . . . . . . . . .
SECTION 7.02. Remedies upon an Event of Default . . . . . . . . . . . .
SECTION 7.03. Unwind Events . . . . . . . . . . . . . . . . . . . . . .
SECTION 7.04. Remedies upon an Unwind Event . . . . . . . . . . . . . .
SECTION 7.05. Residual Guaranty and Return
Conditions . . . . . . . . . . . . . . . . . . . . . .
ARTICLE VIII. THE AGENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 8.01. Authorization and Action . . . . . . . . . . . . . . . .
SECTION 8.02. Agent's Reliance, Etc. . . . . . . . . . . . . . . . . .
SECTION 8.03. Citicorp and Affiliates . . . . . . . . . . . . . . . . .
SECTION 8.04. Purchaser Credit Decision . . . . . . . . . . . . . . . .
SECTION 8.05. Indemnification . . . . . . . . . . . . . . . . . . . . .
SECTION 8.06. Successor Agent . . . . . . . . . . . . . . . . . . . . .
ARTICLE IX. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.01. Survival . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.02. Notices . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.03. Severability . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.04. Amendments, Etc. . . . . . . . . . . . . . . . . . . . .
SECTION 9.05. Headings . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.06. Compliance Responsibility . . . . . . . . . . . . . . . .
SECTION 9.07. Definitions . . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.08. Benefit . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.09. Place of Payment . . . . . . . . . . . . . . . . . . . .
SECTION 9.10. Counterparts . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.11. Governing Law and Jurisdiction . . . . . . . . . . . . .
SECTION 9.12. Time; Business Day . . . . . . . . . . . . . . . . . . .
SECTION 9.13. The Trustee . . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.14. Transaction Costs; Facility Fees;
Upfront Fees . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.15. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . .
SECTION 9.16. Operative Documents; Further
Assurances . . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.17. Confidentiality . . . . . . . . . . . . . . . . . . . . .
SECTION 9.18. Interest . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.19. Waiver of Trial by Jury . . . . . . . . . . . . . . . . .
SECTION 9.20. Options . . . . . . . . . . . . . . . . . . . . . . . . .
SECTION 9.21. Financial Advisor . . . . . . . . . . . . . . . . . . . .
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SECTION 9.22. Securities Representation . . . . . . . . . . . . . . . . .
SECTION 9.23. UNENFORCEABILITY OF ORAL AGREEMENTS;
(TEXAS STATUTORY LANGUAGE) . . . . . . . . . . . . .
Schedule I - Manner of Payment and Communications to
Parties
Schedule II - Pricing Grid
Schedule 4.01(l) - Existing Encumbrances
Appendix A - Definitions
Exhibit A - Form of Lease
Exhibit B - Form of Agency Agreement
Exhibit C - Form of Declaration of Trust
Exhibit D - Form of Instrument Guaranty
Exhibit E - Form of Services Agreement
Exhibit F - Form of Requisition
Exhibit G - Form of Final Completion Certificate
Exhibit H - Form of Independent Engineer's Certificate
Exhibit I - Form of Commitment Reduction Notice
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Execution Copy
PARTICIPATION AGREEMENT dated as of October 31, 1995 (as it may be
amended from time to time, this "Agreement"), by and among
Ferro Corporation,
an Ohio corporation (the "COMPANY"); State Street Bank and Trust Company, a
Massachusetts trust company ("SSBTC"), not in its individual capacity except as
expressly stated herein, but solely as Trustee under the Declaration (herein,
together with any successor trustee under the Declaration, the "TRUSTEE"); the
financial institutions named as purchasers on Schedule I hereto, and/or any
assignee thereof who may, from time to time, become a party to this Agreement
pursuant to the terms hereof (collectively, the "PURCHASERS"); and Citibank,
N.A. ("CITIBANK"), in its capacity as agent for the Purchasers hereunder.
Capitalized terms used but not otherwise defined in this Agreement shall have
the meanings set forth in Appendix A hereto.
Preliminary Statement
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A. Synthetic Products Company, a Delaware corporation ("SYNPRO"),
is the owner of (i) certain parcels of land described on Schedule A to the Ohio
Deed and located in Cleveland, Ohio (the "OHIO FEE PARCELS"), (ii) an easement
interest in a certain parcel of land described on Schedule A to the Ohio Deed
and located in Cleveland, Ohio (the "OHIO EASEMENT PARCEL" and together with
the Ohio Fee Parcels, the "OHIO PARCELS") (iii) a license interest with respect
to a parcel of land in Cleveland, Ohio as described on Schedule A to the
License Agreement (the "LICENSE PARCEL"), (iv) two parcels of land described on
Schedule A to the Texas Deed and located in Fort Worth, Texas (the "TEXAS FEE
PARCELS", and together with the Ohio Fee Parcels, collectively, the "FEE
PARCELS"), (v) certain parcels of land described in the Easements and Option to
Purchase between Synpro and the Company dated as of October 31, 1995 and
located in Fort Worth, Texas (the "TEXAS EASEMENT PARCELS"), (vi) a leasehold
interest in certain parcels of land described in the Easement and located in
Fort Worth, Texas (the "TEXAS LEASEHOLD PARCELS" and together with the Ohio
Easement Parcel and Texas Easement Parcels, collectively, the "EASEMENT
PARCELS"), (vii) a plant for the manufacture of stearates, lubricants and
stabilizers and related facilities located on the Ohio Fee Parcels (the "OHIO
PLANT"), (viii) a plant for the manufacture of stearates, lubricants and
stabilizers located on the Texas Fee Parcels (the "Texas Plant" and together
with
the Ohio Plant, collectively, the "PLANTS"), (ix) certain improvements located
on the Texas Leasehold Parcel and used in connection with the operation of the
Texas Plant (the "TEXAS LEASEHOLD IMPROVEMENTS"), (x) certain improvements
located on the Texas Easement Parcel and used in connection with the Texas
Plant (the "TEXAS EASEMENT IMPROVEMENTS"), (xi) certain fixtures, equipment and
other personal property used in connection with the Plants and presently
located on (a) the Ohio Fee Parcels (the "INITIAL OHIO FEE IMPROVEMENTS"), (b)
on the Texas Fee Parcels (the "INITIAL TEXAS FEE IMPROVEMENTS") and (c) on the
License Parcel (the "INITIAL LICENSE IMPROVEMENTS") (collectively, the "ASSETS"
and together with the Plants, the "INITIAL IMPROVEMENTS") as described on
Schedule A to the ▇▇▇▇ of Sale.
B. On the Financing Closing Date, the Trustee will
acquire from Synpro fee title to the Ohio Fee Parcels and the Texas Fee
Parcels, an easement interest in the Ohio Easement Parcel, a license to the
License Parcel and title to a portion of the Initial Improvements pursuant to
an Asset Purchase Agreement dated as of October 25, 1995 among Synpro, ▇▇▇▇▇▇▇
Group, plc, ▇▇▇▇▇▇▇ America, Inc. and the Company (as the same may be amended
from time to time, the "PURCHASE AGREEMENT"). In addition, on the Financing
Closing Date, (a) the Company will acquire from Synpro (i) the leasehold estate
to the Texas Leasehold Parcel pursuant to the Purchase Agreement, and (ii)
easements over the Texas Easement Parcel pursuant to the Purchase Agreement,
and (b) the Trustee will acquire from the Company (i) easements over the Texas
Leasehold Parcel and to the Texas Easement Improvements pursuant to the
Easement, and (ii) the easements over the Texas Easement Parcels pursuant to
the Second Easement. Thereafter, certain improvements to the Initial
Improvements (the "FINANCED IMPROVEMENTS") will be constructed, as more fully
described in Exhibit A to the Agency Agreement referred to below. The Initial
Improvements and the Financed Improvements, together with all future
structures, buildings, fixtures and other immovable improvements now or
hereafter on the Fee Parcels, the Easement Parcels and the License Parcel and
all integral equipment to be located thereon or therein are collectively
defined as the "IMPROVEMENTS". The Company shall have a one-time option to
exclude from the Financed Improvements certain equipment and other personal
property (other than Improvements with respect to the installation at the Ohio
Plant of certain
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components of the Connecticut Equipment) (the "EXCLUDED ASSETS"), by submission
to the Agent and the Trustee of a Commitment Reduction Notice in accordance
with Section 1.05 below. The Trustee's fee interest in the Fee Parcels,
easement interests in the Easement Parcels, license to the License Parcel and
interest in the Improvements are sometimes referred to herein as the
"PROPERTY". After acquiring the Property as described above, the Trustee will
lease (or grant a license to portions of) the Property to the Company pursuant
to a lease dated as of the date hereof substantially in the form of Exhibit A
hereto (as the same may be amended from time to time, the "LEASE").
C. The Company, acting as the Trustee's Construction
Agent under an agency agreement dated as of the date hereof substantially in
the form of Exhibit B hereto (as the same may be amended from time to time, the
"AGENCY AGREEMENT"), will complete the construction of the Financed
Improvements.
D. To finance the Trustee's acquisition of the Parcels
and the Initial Improvements, the Trustee, on the Financing Closing Date, will
issue to the Certificate Purchaser the Series 1 Certificates and will issue to
the Note Purchasers Series 1 A-Notes and Series 1 B-Notes pursuant to a
declaration of trust dated as of the date hereof substantially in the form of
Exhibit C hereto (as the same may be amended from time to time, the
"DECLARATION" or "DECLARATION OF TRUST"). To finance the construction of the
Financed Improvements, the Trustee will issue on the Financing Closing Date,
Interim Notes to the Note Purchasers and Series 2 Certificates to the
Certificate Purchasers pursuant to the Declaration.
E. Subject to the terms and conditions hereof and
pursuant to Requisitions, the Note Purchasers shall make Advances on the
Financing Closing Date and from time to time thereafter, and each Certificate
Purchaser shall make Investments for all amounts paid or payable as costs for
the acquisition of the Parcels and the Improvements and the design,
engineering, construction, operation, testing and licensing of the
Improvements, as well as interest, distributions, fees and expenses paid or
payable on or with respect to the Interim Notes and Series 2 Certificates on or
prior to the Interim Note Maturity Date, the Operative Documents or otherwise
related to the transactions contemplated hereby
3
(collectively, the "ACTUAL PROJECT COSTS"). Upon the Interim Note Maturity
Date, the Trustee shall refinance the Interim Notes through the issuance of a
specified proportion of Series 2 A-Notes and Series 2 B-Notes, to be issued
pursuant to the Declaration in the same aggregate principal amount as the
Interim Notes. The Instruments will be issued, dated and mature and be payable
as provided in the Declaration. The Instruments shall be entitled to the
benefit of the Trust Estate held pursuant to the Declaration.
F. The Company shall also enter into a guaranty
agreement dated as of the date hereof substantially in the form of Exhibit D
hereto (as the same may be amended from time to time, the "INSTRUMENT
GUARANTY") pursuant to which the Company will guaranty repayment by the Trustee
of the Instruments to the extent provided therein.
G. In addition, the Company will enter into a services
agreement dated as of the date hereof, substantially in the form of Exhibit E
hereto (as the same may be amended from time to time, the "SERVICES AGREEMENT")
pursuant to which it will be obligated to provide certain services to the
Trustee and with respect to the Property in the event the Company does not
purchase the Property at the expiration or other termination of the Lease.
NOW, THEREFORE, in consideration of the agreements herein and
in the other Operative Documents and in reliance upon the representations and
warranties set forth herein and therein, the parties agree as follows:
ARTICLE I.
FINANCING
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SECTION 1.01. AGREEMENT TO ISSUE AND PURCHASE. (a) Subject to the
terms and conditions of this Article I and of Article II hereof, each of
the Note Purchasers hereby agrees to advance (which obligation to advance is
several and not joint and several) to the Agent in the manner provided in
Section 1.04 below, from time to time, its Percentage of Actual Project Costs,
up to in the aggregate, and in no case exceeding, its Note Commitment, and the
Trustee shall issue to each of the Note
4
Purchasers on the Financing Closing Date, in consideration therefor, Interim
Notes in an aggregate principal amount equal to the Interim Note Commitment of
such Note Purchaser and Series 1 A-Notes and Series 1 B-Notes in an aggregate
amount equal to the Series 1 Note Commitment of such Note Purchaser; and
(b) Subject to the terms and conditions of this Article I
and of Article II hereof, each Certificate Purchaser hereby agrees to make
investments (the "INVESTMENT") in the 1995 Ferro Plant Trust by paying to the
Trustee (i) an amount, up to in the aggregate, and in no case exceeding, its
Series 1 Certificate Commitment (the proceeds of which will be used to pay a
portion of the Actual Project Costs relating to the acquisition of the Parcels
and the Initial Improvements and the transaction costs payable pursuant to
Section 9.14) plus (ii) at the time of the Advance made with respect to the
first Requisition submitted by the Company and from time to time thereafter, an
amount, up to in the aggregate but in no case exceeding, its Series 2
Certificate Commitment (the proceeds of which will be used to pay a portion of
the Actual Project Costs incurred in connection with the Financed Improvements
as well as to fund Distributions on the Series 2 Certificates prior to the
Interim Note Maturity Date), and the Trustee shall issue to each Certificate
Purchaser, in consideration therefor, a Series 1 Certificate in an aggregate
stated amount equal to the Series 1 Certificate Commitment of such Certificate
Purchaser and a Series 2 Certificate in an aggregate stated amount equal to the
Series 2 Certificate Commitment of such Certificate Purchaser.
SECTION 1.02. FINANCING CLOSING DATE. The closing of the
transactions specified in Section 1.03 of this Agreement (the "FINANCING
CLOSING") shall take place on October 31, 1995 (or such earlier or later date
to which the Company and the Agent may agree, at such place as the parties
hereto shall agree (the "FINANCING CLOSING DATE").
SECTION 1.03. SIMULTANEOUS FINANCING CLOSING TRANSACTIONS.
On the Financing Closing Date, subject to the satisfaction of the conditions
set forth in Section 2.01 of this Agreement, the following transactions shall
be consummated simultaneously:
5
(a) This Agreement, the Agency Agreement, the
Declaration, the Lease, the Series 1 Certificates, the Series 2 Certificates,
the Interim Notes, the Series 1 A-Notes, the Series 1 B-Notes, the Instrument
Guaranty, the ▇▇▇▇ of Sale, the Deeds, the Easement, the Second Easement and
the Services Agreement, shall be duly executed and delivered by the parties
thereto.
(b) Each of the Note Purchasers shall make an initial
advance (each, an "INITIAL ADVANCE") equal to the sum of (i) its Percentage of
the Series 1 Note Commitment and each Certificate Purchaser shall make an
Investment in the amount of its Series 1 Certificate Commitment in accordance
with the applicable provisions of Section 1.04.
(c) The Agent, on behalf of the Trustee, shall pay or
disburse, or cause to be paid or disbursed, the aggregate sum of the
Investments and the Advances made on the Financing Closing Date as follows:
first to Synpro, the amount of the acquisition price of the Parcels and the
Initial Improvements by transfer of immediately available funds in accordance
with the disbursement instructions agreed upon by Lessor, the Company, Synpro
and the Agent, and the balance to the Company, or as otherwise directed by the
Construction Agent in accordance with such disbursement instructions.
SECTION 1.04. PROCEDURES FOR FUNDINGS; REQUISITIONS.
(a) ADVANCES AND RELATED MATTERS. (i) Subject to the
satisfaction of the conditions set forth in Section 2.01, with respect to the
Financing Closing, or Section 2.02, with respect to each Funding subsequent to
the Financing Closing (except in the case of Fundings made from time to time
pursuant to Section 1.04(c) hereof), (A) each Interim Note Purchaser agrees to
make an advance (each, an "ADVANCE"), from time to time but not more frequently
than once per calendar month, in an amount equal to its Percentage of Actual
Project Costs specified in any Requisition, up to an aggregate principal amount
equal to its Interim Note Commitment; (B) each Series 1 Note Purchaser agrees
to make an Advance on the Financing Closing Date equal to its Series 1
Note Commitment; (C) each Series 1 Certificate Purchaser agrees to make its
Investment on the Financing Closing Date in an amount equal to its Series 1
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Certificate Commitment; and (D) each Series 2 Certificate Purchaser agrees to
make an Investment on the date of the Funding of the first Requisition in the
amount of such Purchaser's Certificate Percentage of the amount requested in
the first Requisition not to exceed such Purchaser's Certificate Percentage of
$766,621.52 and from time to time thereafter, but not more frequently than once
per calendar month, up to an aggregate amount equal to its Series 2 Certificate
Commitment. Each Purchaser shall record the Advances or Investment, as the
case may be, made by it on the payment schedule attached to its Interim Note or
Certificate.
(ii) On the date specified by the Company for any Funding,
each Note Purchaser and each Certificate Purchaser, shall, before 10:00 A.M.
(
New York City time) make available, or cause to be made available, to the
Agent, on behalf of the Trustee, an amount equal to the Advance or Investment,
as the case may be, to be made by it, at the Agent's address referred to in
Schedule I hereto, in immediately available funds. Upon the Agent's receipt of
funds from the Note and Certificate Purchasers for such Funding and upon
fulfillment of the applicable conditions set forth in Article II, the Agent
will make payments of interest and Distributions due hereunder on the Interim
Notes and Series 2 Certificates and will make the remaining funds representing
such Funding available for credit to and upon the instructions of the
Construction Agent (or the Company, in the case of the Financing Closing) in
immediately available funds in accordance with the Requisition for such
Funding.
(iii) No Note Purchaser shall have any obligation to make any
Advance for any amount in excess of the lesser of (A) its aggregate Note
Commitment and (B) its Percentage of the difference between (1) the aggregate
of the Actual Project Costs (less the amount of the Investment then being made
or theretofore made by the Certificate Purchasers) set forth in the Approved
Construction Budget as such Actual Project Costs may have been reduced pursuant
to Section 1.05 and (2) the aggregate of all prior Advances made by the Note
Purchasers. No Certificate Purchaser shall have any obligation to make an
Investment in excess of its Certificate Commitment.
(iv) The Company acknowledges that if it, as the Construction
Agent, does not provide to the Agent all
7
necessary documentation required hereunder on a timely basis, delays may result
in the making of the Advances and the Investment. The Agent shall have no duty
to verify the authenticity of any signature appearing on any Requisition other
than to compare it with incumbency certificates provided by the Company listing
Officers of the Company authorized to execute Requisitions.
(v) Unless the Agent shall have received notice from a Note
Purchaser prior to the date of any Advance that such Note Purchaser will not
make available to the Agent its Advance, the Agent may assume that such Note
Purchaser has made its funds available to the Agent on such date in accordance
with this Section 1.04(a) and the Agent may, in reliance upon such assumption,
make available to the Construction Agent on such date a corresponding amount.
If and to the extent that such Note Purchaser shall not have so made such
Advance available to the Agent on such date, such Note Purchaser agrees to
repay the Agent forthwith on demand by the Agent such corresponding amount,
together with interest thereon, for each day from the date such amount is made
available to the Construction Agent, until the date such amount is repaid to
the Agent, at the Federal Funds Rate. If such Note Purchaser shall repay to
the Agent such corresponding amount, such amount so repaid shall constitute
such Note Purchaser's funding of its Advance for purposes of this Agreement.
(vi) The failure of any Purchaser to make the Advance or
Investment, as the case may be, to be made by it shall not relieve any other
Purchaser of its obligation, if any, hereunder to make its Advance or
Investment, but no Purchaser shall be responsible for the failure of any other
Purchaser to make the Advance or Investment to be made by such other Purchaser
on the date of any Funding.
(b) REQUISITIONS. Not less than five (5) Business Days
prior to the day on which a Funding is desired, with respect to the financing
of the Financed Improvements, the Construction Agent must submit to the Agent,
with a copy to the Trustee, a requisition (each, a "REQUISITION") substantially
in the form attached as Exhibit F hereto. The Agent will give notice of such
Requisition to the Note Purchasers, the Certificate Purchasers and the Trustee
not less than five (5) Business Days prior to the date of the Funding requested
8
therein. Such notice by the Agent shall specify the amount of the Advance or
Investment, as the case may be, to be made by each Purchaser with respect to
the financing of the Financed Improvements. Each Requisition (i) shall be
irrevocable, (ii) must request a Funding of at least $250,000 or such lesser
amount as shall be equal to the total aggregate principal and stated amount of
the unused Total Commitment available at such time, and (iii) shall request
that the Purchasers make Advances and/or the Investment, as the case may be,
for Actual Project Costs incurred with respect to the financing of the Financed
Improvements as specified in the Requisition. Each Requisition shall
constitute a representation and warranty by the Company that all the conditions
precedent to such Funding have been satisfied. No Requisition may be delivered
prior to the earlier of (x) the last date upon which a Commitment Reduction
Notice may be given pursuant to Section 1.05 hereof, and (y) if a Commitment
Reduction Notice is timely delivered pursuant to Section 1.05 hereof, the date
on which the Commitment Reduction becomes effective in accordance with Section
1.05 hereof.
(c) CERTAIN ADVANCES AND INVESTMENTS. It is intended
that all interest on the Interim Notes, Facility Fees on the Interim Notes,
Upfront Fees and other fees and expenses of the Note Purchasers due hereunder
prior to the Interim Note Maturity Date shall be paid from Advances and that
all Distributions, Facility Fees and other fees and expenses of the Series 2
Certificate Purchasers due hereunder prior to the Interim Note Maturity Date
shall be paid from Investments. No Requisition shall be necessary to permit
the Agent to request the Note Purchasers to make Advances for the account of
any or all Note Purchasers, to pay amounts for interest on the Interim Notes or
Facility Fees due to such Note Purchasers hereunder on or prior to the Interim
Note Maturity Date or to request the Series 2 Certificate Purchasers to make
Investments to pay Distributions on the Series 2 Certificates prior to the
Interim Note Maturity Date, PROVIDED, HOWEVER, that the Purchasers shall make
such Advances or Investments, as the case may be, only (i) after the Agent has
notified the Purchasers and the Company of the date and the Applicable Rate set
for such Funding and the amounts thereof due and owing and unpaid to be made by
each such Purchaser and (ii) on a Payment Date. Notwithstanding anything to
the contrary contained in this Agreement, Advances and Investments
9
shall be limited in the aggregate to the Actual Project Costs, up to each Note
Purchaser's Note Commitment plus each Certificate Purchaser's Certificate
Commitment.
SECTION 1.05. COMMITMENT REDUCTION.
(a) COMMITMENT REDUCTION NOTICE. On or before April 30,
1996, the Company shall deliver to the Agent, the Trustee and the Purchasers
either (i) a notice of its intent to eliminate, from the Financed Improvements,
the Excluded Assets and to reduce correspondingly the Series 2 Note Commitment
and the Series 2 Certificate Commitment (the "COMMITMENT REDUCTION") to reflect
the decrease in the cost of the construction and installation of the Financed
Improvements resulting from such elimination (the "COMMITMENT REDUCTION
NOTICE") in the form of Exhibit I hereto or (ii) its written confirmation that
it will not deliver a Commitment Reduction Notice.
(b) EFFECTIVENESS OF THE COMMITMENT REDUCTION. If in the
reasonable judgment of the Trustee, the Agent and the Majority Purchasers, the
fair market value of the remaining Property would be equal to or greater than
the Adjusted Capitalized Cost of the Property after such Commitment Reduction,
the Agent shall give prompt notice thereof to the Company by countersigning the
Commitment Reduction Notice where indicated, and delivering a copy thereof to
the Company within five Business Days and upon delivery of such notice the
Commitment Reduction specified in the Commitment Reduction Notice shall be
effective. Upon the reasonable request of the Trustee, the Agent and the
Purchasers, the Company shall cause a new Appraisal to be prepared by the
Appraiser to verify that such Commitment Reduction would not have an adverse
effect on the fair market value of the remaining Property.
SECTION 1.06. EQUIPMENT SALE OPTIONS. On or before April 30,
1996, after the satisfaction of the Company's obligations set forth in Section
2.03, the Company may deliver to the Agent, the Trustee and the Purchasers, on
the same date or on different dates, a written offer to sell to the Trustee
certain equipment and other personal property purchased from Synpro and located
in Philadelphia, Pennsylvania (the "PENNSYLVANIA ASSETS") and/or a written
offer to sell certain equipment and other personal property purchased from
Synpro and located in Stratford, Connecticut (the "CONNECTICUT
10
ASSETS") (each such written offer, an "EQUIPMENT SALE OFFER") for a purchase
price equal to the fair market value of such assets. If such assets were not
separately valued in the Appraisal, the Company will cause a new appraisal to
be prepared at its cost and expense. The Trustee shall accept the Equipment
Sale Offer within five (5) Business Days of receipt of such Equipment Sale
Offer or, if such new appraisal has been ordered, within ten (10) Business Days
after receipt of such appraisal unless the appraisal indicates, in the
reasonable judgment of the Agent, the Trustee and the Purchasers, that
acceptance would have an adverse effect on the fair market value of the
Property. If an Equipment Sale Offer is accepted, (i) the Trustee and the
Company shall execute all documents and instruments necessary, in Special
Counsel's determination, to consummate such sale and (ii) the Company shall
cause the Pennsylvania Assets or the Connecticut Assets or both of the
Pennsylvania Assets and the Connecticut Assets, as the case may be, to be moved
to, and installed on, one of the Fee Parcels or Easement Parcels or at the
Bedford Plant. Any sale of the Connecticut Assets shall take place out of the
State of Connecticut. Upon such sale, the Pennsylvania Assets or the
Connecticut Assets, or both of the Pennsylvania Assets and the Connecticut
Assets, as the case may be, will constitute part of the Property and shall be
subject to the Lease.
ARTICLE II.
CONDITIONS PRECEDENT
--------------------
SECTION 2.01. CONDITIONS PRECEDENT TO THE FINANCING CLOSING.
The obligations set forth in Article I shall be subject to the fulfillment, to
the satisfaction of the Agent, on or before the Financing Closing Date, of the
following conditions precedent:
(a) DUE AUTHORIZATION, EXECUTION AND DELIVERY. The
Operative Documents shall have been duly authorized, executed and delivered by
all parties thereto and shall be in full force and effect. No condition or
event shall exist or have occurred which would constitute a Default or Event of
Default under any of the Operative Documents by any party thereto and the
Trustee and the Company shall each have delivered an Officer's Certificate as
to the Company's or the Trustee's respective compliance dated the Financing
Closing Date.
11
(b) REPRESENTATIONS. The representations and warranties
of each of the Company and SSBTC, respectively, set forth in the Operative
Documents shall be true and correct on and as of the Financing Closing Date,
and the Company and SSBTC shall each have delivered an Officer's Certificate
dated the Financing Closing Date to such effect as to their respective
representations and warranties.
(c) OPINIONS. The following opinions, dated the
Financing Closing Date and addressed to the parties indicated below, shall have
been delivered:
(i) [Intentionally Omitted]
(ii) an opinion of Squire, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, special counsel to the Company, addressed to the
Agent, the Purchasers and the Trustee, and in form and
substance satisfactory to the Agent and Special Counsel,
(iii) an opinion of ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇,
special counsel to the Agent and the Purchasers, addressed to
the Agent, the Purchasers and the Trustee, as to matters of
Texas law, and in form and substance satisfactory to the Agent
and Special Counsel;
(iv) an opinion of ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇,
special counsel to the Trustee ("TRUSTEE'S COUNSEL"),
addressed to the Agent, the Purchasers and the Company, and in
form and substance reasonably satisfactory to the Agent and
Special Counsel;
(v) opinions of Special Environmental
Counsel to the Agent and the Purchasers, addressed to the
Agent, the Purchasers and the Trustee, and in form and
substance satisfactory to the Agent with respect to
Environmental Laws; and
(vi) such other opinions of counsel as the
Agent and the Special Counsel may reasonably request,
addressed to the Agent, the Purchasers and the Trustee, and in
form and substance reasonably satisfactory to the Agent and
Special Counsel, and directions from the Company regarding the
opinions referred to in clause (ii) above.
12
(d) PROCEEDINGS SATISFACTORY AND OTHER
EVIDENCE. All corporate and other proceedings taken or to be taken in
connection with the transactions contemplated by the Operative Documents and
all documents, papers and authorizations relating thereto shall be satisfactory
to the Agent, the Company and their respective counsel. The Agent and the
Company, and their respective counsel shall receive copies of such documents
and papers as they have requested, in form and substance satisfactory to them,
including but not limited to the Operative Documents.
(e) LEGALITY. The execution, delivery and
issuance of the Notes and the Certificates by the Trustee and the purchase
thereof by the Note and Certificate Purchasers shall not be subject to the
registration requirements of the Act or any state securities or blue sky Laws,
and shall not be prohibited by any applicable Law (including, without
limitation, Regulation G, Regulation T, Regulation U or Regulation X and any
applicable usury Laws) and shall not subject any Note or Certificate Purchaser
to any Tax (other than Excluded Charges or a Tax paid by the Company pursuant
to Sections 6.03 and 9.14), penalty, liability or other onerous condition under
or pursuant to any applicable Law and the Agent and the Note and Certificate
Purchasers shall receive such evidence as the Agent and the Note and
Certificate Purchasers (through the Agent) may reasonably request to establish
compliance with this condition.
(f) CLOSING FEES. The Trustee shall have paid, or caused to
be paid, from the proceeds of the purchase price to be paid for the
Instruments on the Financing Closing Date (i) to Special Counsel,
Special Environmental Counsel and the Trustee's Counsel, the reasonable fees
and expenses of such counsel that are set forth in invoices submitted by such
counsel to the Company at least two days prior to the Financing Closing Date,
(ii) to CSI, the advisory fee referred to in the engagement letter dated as of
October 16, 1995 (the "ADVISORY FEE"), and (iii) such other amounts as the
Company may be required to pay on or before the Financing Closing Date in
accordance with the terms of the Operative Documents.
(g) TITLE AND SURVEY. (i) Synpro shall
have conveyed to the Trustee good and marketable title to (aa) an indefeasible
fee estate in each of the Texas Fee
13
Parcels and the Ohio Fee Parcels and to the Initial Texas Fee Improvements and
the Initial Ohio Fee Improvements, (bb) an easement interest in the Ohio
Easement Parcel, and (cc) a license interest in the License Parcel and the
Initial License Improvements in each case free and clear of all Liens except
Permitted Encumbrances. The Company shall deliver, or cause to be delivered,
to the Agent, the Trustee, the Purchasers and Special Counsel (I) a Texas
Standard Form T-1 form of extended coverage policy of owner's title insurance
for the Texas Fee Parcels and the Initial Texas Fee Improvements with the Texas
Standard Owner Policy Endorsement and naming the Trustee as the insured (the
"TEXAS TITLE POLICY") in the aggregate amount of $4,656,000, issued by the
Title Company and showing and insuring the record title of the Trustee in the
Texas Fee Parcels, and (II) an ALTA 1970 (amended 10-17-70 and 10-17-84) form
of extended coverage policy of owner's title insurance for the Ohio Fee Parcels
and the Ohio Fee Improvements (the "OHIO TITLE POLICY"), and naming the Trustee
as the insured, in the aggregate amount of $3,104,000 issued by the Title
Company, showing the Trustee as the record owner of the Ohio Fee Parcels and
Ohio Fee Improvements and the holder an easement interest in the Ohio Easement
Parcel and the Ohio Easement Improvements (the Texas Title Policy and the Ohio
Title Policy are collectively referred to herein as the "TITLE POLICY"). The
Title Policy shall be issued subject only to Permitted Encumbrances and
containing such affirmative insurance as Agent or Special Counsel shall
require.
(ii) The Agent and the Trustee shall have received a current,
accurate survey of each of the Parcels showing the location of all
improvements, easements, encroachments and other survey matters, dated a recent
date, in form and substance satisfactory to the Agent, the Trustee and the
Title Company, prepared by licensed surveyors acceptable to the Agent, which
survey is certified to the Company, the Trustee, the Agent and the Note and
Certificate Purchasers.
(h) COMPLIANCE WITH LAW. The Parcels, the Improvements and the
construction thereof, if applicable, and the Construction Agent shall be in
material compliance with all Laws, including, without limitation, all building,
construction and zoning Laws and Environmental Laws applicable to the Property.
14
(i) PERMITS AND CERTAIN PROPERTY MATTERS. (i) All
Permits that are or will become Applicable Permits shall have been obtained,
except Applicable Permits relating to the Financed Improvements customarily
obtained or which are permitted by Law to be obtained after the Financing
Closing Date (in which case the Company, having completed all appropriate
diligence in connection therewith, shall have no reason to believe that such
Permits will not be granted in the usual course of business prior to the date
that such Permits are required by Law). All such obtained Permits shall be in
proper form, shall be in full force and effect and not subject to any further
appeal, consent or further contest or to any unsatisfied condition that may
allow modification or revocation; and
(ii) The Property shall not have suffered a Condemnation or a
Casualty, or any other damage or destruction which renders the Property
unusable in whole or in material part and, under applicable Law, the Property
may be used for the purposes contemplated by the Company in accordance with the
Lease.
(j) DOCUMENTS RELATING TO THE PROPERTY. The Company
shall deliver, or cause to be delivered, to the Trustee, the Agent and the
Purchasers documentation with respect to the condition of the Property or any
part thereof, the real estate Taxes applicable to the Parcels and the Property
and such other documents and agreements (including but not limited to a copy of
the Construction Contracts and any other necessary Facility Agreements to the
extent available, or assignments thereof) relating to the operation of the
Property or any part thereof as the Agent or the Purchasers may reasonably
request, in form and substance reasonably acceptable to the Agent and the
Purchasers.
(k) INSURANCE. The Company shall (i) maintain, and cause
each of its Subsidiaries to maintain, insurance in accordance with the
provisions of Section 5.01(c); and (ii) be in compliance with all Insurance
Requirements. The Company shall deliver, or cause to be delivered, to the
Trustee and the Agent: (i) certificates of insurance, applicable reinsurance
cover notes or other satisfactory assurances, evidencing the coverage of such
policies in compliance with the Insurance Requirements; and (ii) copies of the
exceptions to coverage of such policies.
15
(l) TAXES. All Taxes (other than Excluded Charges), fees
and other charges which have become due and payable in connection with the
execution and delivery of the Operative Documents shall have been paid by the
Company.
(m) ENVIRONMENTAL MATTERS. The Phase II environmental
audit of each of the Parcels and the Plants by the Environmental Consultant
shall have been conducted, at the sole cost and expense of the Company, and the
Agent, the Trustee and the Purchasers shall have received a copy of the
Environmental Consultant's Phase II report, which shall be in form and
substance satisfactory to the Trustee, the Agent and the Purchasers. Except as
may be referenced in the Disclosed Information, no environmental hazard with
respect to the Property shall have arisen, or come to the attention of the
Company, since the date of the Phase II.
(n) [Intentionally Omitted]
(o) APPRAISAL. The Company shall cause an appraisal of
the Property (the "APPRAISAL"), satisfactory in form and substance to the Agent
and the Purchasers, to be delivered to the Agent and the Purchasers. Such
Appraisal shall be prepared by the Appraiser and shall be at the expense of the
Company.
(p) NO MATERIAL ADVERSE EVENT. There shall exist no
action, suit, investigation, litigation or proceeding affecting the Company or
any of its Subsidiaries pending or, to the Company's knowledge, threatened
before any court, governmental agency or arbitrator that could be reasonably
likely to have a Material Adverse Effect.
(q) NOTICE OF FINANCING CLOSING DATE. The Company shall
have delivered or caused to be delivered to the Agent and the Purchasers
sufficient advance notice before the anticipated Financing Closing Date, which
notice shall request that each Purchaser make all necessary arrangements to
fund the Series 1 Note Commitment and the Investment in respect of the Series 1
Certificate Commitment.
(r) RECORDING AND FILING. Each of the Deeds, the Lease (or a
memorandum thereof), the ▇▇▇▇ of Sale, the Easement, the Second Easement and
all financing
16
statements under the UCC shall have been duly recorded, published, registered
and filed by the Company (or arrangements for such recording, publishing,
registering and filing shall have been made), in such manner and in such places
as the Company, the Company's counsel, the Agent and Special Counsel shall
determine to be necessary or appropriate to publish notice thereof and protect
the validity and effectiveness thereof and to establish, create, perfect,
preserve and protect the rights of the parties thereto and their respective
successors and signs, and all Taxes, fees and other charges in connection with
such recording, publishing, registration and filing of the Operative Documents
or any memoranda thereof and any financing statements shall have been paid, or
caused to be paid, by the Company.
(s) PURCHASE AGREEMENT, ETC. The Agent, the Trustee and
each Purchaser shall have received copies, certified by an Officer of the
Company as true, correct and complete, of the Purchase Agreement, which shall
be in full force and effect and shall not have been amended or restated in any
material respect without the prior written consent of the Agent. All of the
conditions precedent set forth in Section 9 of the Purchase Agreement shall
have been satisfied and the Agent shall have received an Officer's Certificate
of the Company certifying satisfaction of all such conditions precedent. The
Sellers, the Trustee, the Agent and the Purchasers shall have delivered the
Release Agreement.
(t) SATISFACTION WITH CONTEMPLATED TRANSACTIONS. The Agent,
the Trustee and each Purchaser shall be satisfied, each in its sole discretion,
with their review of the Property and all material matters in connection with
the acquisition thereof by the Trustee, including without limitation, the
Purchase Agreement and the Facility Agreements, to the extent available, and
each other contract that is material to the ownership, leasing and operation of
the Property.
(u) ADDITIONAL DOCUMENTS. The Agent shall have received
such other approvals, certificates or documents as the Agent may reasonably
request to evidence satisfaction of the conditions set forth in this Section
2.01.
(v) ASSET VALUE ALLOCATION. The Agent shall have
received a schedule of all the equipment and other
17
personal property constituting the Initial Improvements which schedule shall
allocate, individually or by specified lots, the acquisition price among the
scheduled items of property.
SECTION 2.02. CONDITIONS PRECEDENT TO FUNDING SUBSEQUENT TO
THE FINANCING CLOSING. The several (and not joint and several) obligations of
each of the Note Purchasers to make Advances subsequent to the Financing
Closing as set forth in Article I shall be subject to the fulfillment, to the
satisfaction of the Agent, by, on or as of the date of such Funding, of the
following conditions:
(a) REPRESENTATIONS AND WARRANTIES. The representations
and warranties of the Company set forth in the Operative Documents shall be
true and correct as if made on and as of the date of such Funding or, as
applicable, on and as of the date specified in such representation or warranty.
(b) COMPLIANCE; NO DEFAULT, ETC. The Company shall be in
compliance with its obligations under the Operative Documents on such date and
there shall exist no Default, Event of Default, Unwind Event or Environmental
Trigger under the Operative Documents and no Termination Notice shall have been
delivered or been deemed to have been delivered.
(c) REQUISITION; USE OF INVESTMENT PROCEEDS. Except with
respect to Advances made by the Purchasers pursuant to Section 1.04(c), the
Agent shall have received a timely and complete Requisition pursuant to and in
compliance with Section 1.04(b) hereof. All proceeds of the Fundings expended
by or on behalf of the Company shall have been applied solely to Actual Project
Costs, and the Company, in its individual capacity and not as Construction
Agent, shall certify the same in each Requisition and provide such other
evidence with respect to the use of such proceeds as may be reasonably
requested by the Agent.
(d) COMPLIANCE WITH LAW. The Parcels, the Improvements
and the construction thereof and the Construction Agent shall be in material
compliance with all Laws, including, without limitation, all building,
construction and zoning Laws and Environmental Laws applicable to the Property.
18
(e) NO MATERIAL ADVERSE EVENT. There shall exist no
action, suit, investigation, litigation or proceeding affecting the Company or
any of its Subsidiaries pending or, to the Company's knowledge, threatened
before any court, governmental agency or arbitrator that (i) could be
reasonably likely to have a Material Adverse Effect or (ii) purports to affect
the legality, validity or enforceability of this Agreement or any Note or the
consummation of the transactions contemplated hereby, and the Company, in its
individual capacity and not as Construction Agent, shall certify the same in
each Requisition.
(f) LEGALITY. The making of any Advance, and maintenance
thereof, by any Note Purchaser shall not be prohibited by any applicable Law
(including, without limitation, Regulation G, Regulation T, Regulation U or
Regulation X and any applicable usury Laws) and shall not subject any Note
Purchaser to any Tax (other than Excluded Charges and any Tax paid by the
Company pursuant to Sections 6.03 and 9.14), penalty, liability or other
onerous condition under or pursuant to any applicable Law.
(g) PERMITS. All Permits that are or will become
Applicable Permits shall have been obtained, except Applicable Permits
customarily obtained or which are permitted by Law to be obtained after the
date of the requested Advance (in which case the Company, having completed all
appropriate diligence in connection therewith, shall have no reason to believe
that such Permits will not be granted in the usual course of business prior to
the date that such Permits are required by Law). All such obtained Permits
shall be in proper form, in full force and effect and not subject to any
appeal, consent or further contest or to any unsatisfied condition that may
allow modification or revocation.
(h) FINANCING CLOSING. The Financing Closing shall have
been consummated and all conditions precedent thereto shall have been satisfied
or waived in accordance with the terms of this Agreement.
(i) TAXES. All Taxes (other than Excluded Charges)
payable by the Company shall have been paid by the Company, subject to the
Company's rights of contest pursuant to the Lease.
19
(j) ADDITIONAL DOCUMENTS. The Agent shall have received
such other approvals, certificates or documents (including without limitation
an updated title report) as the Agent may reasonably request to evidence
satisfaction of the conditions set forth in this Section 2.02.
SECTION 2.03. OBLIGATIONS SUBSEQUENT. On or before April 30,
1996, the Company shall have delivered a copy of the Construction Budget,
Construction Schedule and, to the extent available, all other Facility
Agreements.
ARTICLE III.
REFINANCING OF NOTES
--------------------
SECTION 3.01. REFINANCING OF INTERIM NOTES. Subject to
Section 3.02, on the Interim Note Maturity Date the remaining unused Interim
Note Commitments of the Note Purchasers, if any, will automatically be canceled
and the Interim Notes will be refinanced through the issuance by the Trustee of
Series 2 A-Notes and Series 2 B-Notes. Each of the Holders of the Interim
Notes on the Interim Note Maturity Date shall receive as payment in full of the
aggregate principal amount thereof Series 2 A-Notes and Series 2 B-Notes in
aggregate principal amounts determined pursuant to the Interim Note Maturity
Formula.
SECTION 3.02. CONDITIONS PRECEDENT TO FINAL COMPLETION DATE.
The following conditions shall be fulfilled to the reasonable satisfaction of
each of the Purchasers on or as of the Final Completion Date:
(a) LIEN RELEASES AND WAIVERS. The Construction Agent
shall have secured final lien releases or waivers by all contractors and all
subcontractors and by materialmen and other parties who have supplied labor,
materials or services for the design and construction, testing, start-up or
operation of the Financed Improvements, or who otherwise might be entitled to
claim a contractual or statutory lien against the Property or any part thereof.
(b) CERTIFICATE OF FINAL COMPLETION; LEGAL COMPLIANCE.
The Company shall deliver to the Agent and the Trustee an Officer's Certificate
of Final Completion,
20
approved by the Independent Engineer in the form of Exhibit G hereto, to the
effect that final completion of the Financed Improvements, as described
therein, has occurred and further certifying to the effect that:
(i) The Property and the construction
and operation of the Improvements are in compliance in all
material respects with all applicable Laws (including, without
limitation, Environmental Laws); and
(ii) All Permits (including without
limitation a permanent certificate of occupancy) that are or
will become Applicable Permits have been obtained, except
Applicable Permits customarily obtained or which are permitted
by Law to be obtained after the Final Completion Date (in
which case the Company, having completed all appropriate
diligence, shall have no reason to believe that such Permits
will not be granted in the usual course of business prior to
the date that such Permits are required by Law and the Company
shall have applied for such Permits and satisfied all legal
requirements necessary to authorize continued operation while
the Permit application is pending). All such obtained Permits
shall be in proper form, in full force and effect and not
subject to any appeal or contest or to any unsatisfied
conditions (other than conditions relating to completion in
the future) that may allow modification or revocation.
(c) INDEPENDENT ENGINEER'S CERTIFICATION. The Company
shall deliver a Certificate in the form of Exhibit H hereto executed by the
Independent Engineer (the "INDEPENDENT ENGINEER'S CERTIFICATE") certifying that
(i) each Plant installation has been mechanically completed and electrically
checked, and piping and equipment have been flushed and pressure tested and
(ii) each Plant (A) has demonstrated production capability during a continuous
72 hour period of at least 90% of nameplate capacity of stearic acid,
stearates, stabilizers and lubricants, as applicable to each such Plant,
meeting product design specifications for such products during such test period
and (B) with respect to the environmental improvements, has demonstrated at
least 90% of the design recovery, in each case at levels of efficiency
acceptable to the Agent, the Trustee and the Majority Purchasers. In making
such certification, the
21
Independent Engineer, in his sole discretion, either may rely on production
records provided by the Company or require a performance test.
(d) INSURANCE. The Company shall be in compliance with
all Insurance Requirements and all insurance policies required thereunder shall
be in full force and effect. To the extent not previously delivered pursuant
hereto, the Company shall deliver, or cause to be delivered, to the Trustee and
the Agent certificates of insurance or applicable reinsurance cover notes
evidencing the coverage of such policies.
(e) REPRESENTATIONS AND WARRANTIES. The representations
and warranties of the Company as set forth in the Operative Documents shall be
true and correct as if made on and as of the Final Completion Date or, as
applicable, on and as of the date specified in such representation or warranty.
(f) ENVIRONMENTAL REMEDIATION. All material remedial
obligations of the Sellers under the Purchase Agreement shall have been
completed under the terms of the Purchase Agreement. The Company shall have
(i) caused the Environmental Consultant to conduct an updated environmental
audit of the Parcels and the Plants and (ii) provided to the Agent, the
Purchasers and the Trustee a copy of the Environmental Consultant's report on
such audit, which report shall evidence such remediation and conclude that no
environmental hazards exist on the Property that are likely, in the reasonable
judgment of the Trustee, the Agent and the Purchasers, to result in a Material
Adverse Effect.
(g) ADDITIONAL DOCUMENTS. The Agent shall have received
such other approvals, certificates or documents (including, without limitation,
an updated, as-built title report and endorsement to the Title Policy) as the
Agent may reasonably request to evidence satisfaction of the conditions set
forth in this Section 3.02.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
------------------------------
SECTION 4.01. COMPANY REPRESENTATIONS AND WARRANTIES. The
Company hereby represents and warrants
22
to the Trustee, the Agent and the Purchasers that the following shall be true
and correct on and as of the Financing Closing Date:
(a) CORPORATE EXISTENCE. The Company is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Ohio and is duly qualified and authorized to do business in the State
of Texas and, if required, in the State of Connecticut and the Commonwealth of
Pennsylvania.
(b) CORPORATE AND GOVERNMENTAL AUTHORIZATION; NO
CONTRAVENTION. The execution, delivery and performance by the Company of this
Agreement and the other Operative Documents to which it is a party are within
the Company's corporate powers, have been duly authorized by all necessary
corporate action, require no action by or in respect of, or filing with, any
governmental body, agency or official and do not contravene, or constitute a
default under, any provision of applicable Law or of the articles of
incorporation or code of regulations of the Company or of any agreement,
judgment, injunction, order, decree or other instrument binding upon the
Company or result in the creation or imposition of any lien on any asset of the
Company (except as contemplated by the Operative Documents) or its
Subsidiaries, except where such contravention, default or lien would not result
in a Material Adverse Effect.
(c) BINDING EFFECT. This Agreement and the other
Operative Documents to which the Company is a party are legal, valid and
binding obligations of the Company enforceable against the Company in
accordance with their respective terms.
(d) FINANCIAL INFORMATION. (i) The consolidated balance
sheet of the Company and its Consolidated Subsidiaries as of December 31, 1994,
and the related consolidated statements of income and cash flows for the fiscal
year then ended, reported on by KPMG Peat Marwick LLP and set forth in the
Company's annual report for the fiscal year ended December 31, 1994 as filed
with the Securities and Exchange Commission (the "COMMISSION") on Form 10-K and
the consolidated balance sheet of the Company and its Consolidated Subsidiaries
as at June 30, 1995 and the related consolidated statements of income and cash
flows of the Company and its
23
Consolidated Subsidiaries for the three months then ended, duly certified by a
financial officer of the Company, copies of which have been delivered to each
of the Note and Certificate Purchasers, fairly present, in conformity with
GAAP, the consolidated financial position of the Company and its Consolidated
Subsidiaries as of such dates and their consolidated results of operations and
changes in financial position for such periods.
(ii) Since December 31, 1994, there has been no Material Adverse Change.
(e) LITIGATION. There is no pending or threatened
action, suit, investigation, litigation or proceeding, including, without
limitation, any Environmental Action, affecting the Company or any of its
Subsidiaries before any court, governmental agency or arbitrator that (i) could
be reasonably likely to have a Material Adverse Effect or (ii) purports to
affect the legality, validity or enforceability of this Agreement or any of the
Operative Documents or the consummation of the transactions contemplated
hereby.
(f) COMPLIANCE WITH ERISA, ETC.
(i) No ERISA Event has occurred or is
reasonably expected to occur with respect to any Plan.
(ii) Neither the Company nor any ERISA
Affiliate has incurred or is reasonably expected to incur any
Withdrawal Liability to any Multiemployer Plan.
(iii) Neither the Company nor any ERISA
Affiliate has been notified by the sponsor of a Multiemployer
Plan that such Multiemployer Plan is in reorganization or has
been terminated, within the meaning of Title IV of ERISA, and
no such Multiemployer Plan is reasonably expected to be in
reorganization or to be terminated, within the meaning of
Title IV of ERISA.
(iv) Except as set forth in the financial
statements referred to in Section 4.01(d), the Company and its
Subsidiaries have no material liability with respect to
"expected post retirement benefit obligations" within the
meaning of Statement of Financial Accounting Standards No.
106.
24
(g) SUBSIDIARIES. Each of the Company's Subsidiaries is
a corporation duly incorporated, validly existing and in good standing, in each
case under the laws of its jurisdiction of incorporation, except where failure
to do so would not constitute a Material Adverse Effect.
(h) STATUS. The Company is not an "investment company"
within the meaning of the Investment Company Act of 1940, as amended, nor is it
subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act or the Interstate Commerce Act, or under any other state or
Federal Law limiting its ability to execute and deliver any Operative Document
or perform its obligations thereunder.
(i) COMPLIANCE WITH MARGIN REGULATIONS. No proceeds of
any Advance or Investment have been used in violation of any applicable Law
(including, without limitation, Regulation G, Regulation T, Regulation U and
Regulation X).
(j) NO DEFAULT. No event has occurred and no condition
exists which constitutes a Default or an Event of Default.
(k) CONSENTS. The execution and delivery by the Company
of each Operative Document to which it is a party and any other agreement which
it has entered into in connection with the transactions contemplated thereby,
the consummation of the transactions contemplated thereby and its compliance
with the terms thereof does not require the consent or the approval or
authorization of, or filing, registration or qualification with, any Federal,
state or local government on the part of the Company as a condition to such
execution, delivery and compliance.
(l) TITLE TO THE PARCELS.
(i) As of the Financing Closing Date, the Trustee
will have good and marketable title to an indefeasible fee estate in each of
the Fee Parcels, subject to no Liens other than Permitted Encumbrances and
those set forth on Schedule 4.01(l) attached hereto.
(ii) Also as of the Financing Closing Date, the
Trustee will have good and marketable title to
25
the easement interests in each of the Ohio Easement Parcel, the Texas Leasehold
Parcel and the Texas Easement Parcels subject to no Liens other than Permitted
Encumbrances.
(ii) Neither the Fee Parcels, the Easement Parcels
nor the Property contain any defect or feature making them unsuitable for the
proper operation of the Improvements.
(m) COMPLIANCE WITH LAW. The Company and, prior to the
Financing Closing Date, Synpro is in material compliance with all Laws
(including all Environmental Laws) with respect to the Parcels or the Property
or with respect to its leasing and operation of the Property, the construction
of the Improvements or the conduct of its business on the Property. Except for
those items referenced in the Disclosed Information, neither the Company nor,
to the knowledge of the Company (and prior to the Financing Closing Date),
Synpro has received any notice of, or citation for, any violation of any Law or
any Environmental Action which has not been resolved or which the Company
reasonably believes can not be resolved in the ordinary course of business,
which notice or citation or Environmental Action relates to the ownership or
operation of the Parcels or the Property.
(n) RECORDATION. The Deeds, the ▇▇▇▇ of Sale, the Lease
(or a memorandum thereof), the Easement, the Second Easement, and all financing
statements under the UCC, to be recorded or filed pursuant to Section 2.01(r)
hereof, are in a form sufficient to create or publish notice of, as the case
may be, the interests in the Fee Parcels, Easement Parcels, the Property and
the Improvements purported to be created thereby. Upon the recordation of the
Deeds, the ▇▇▇▇ of Sale, the Easement, the Second Easement, and the Lease (or a
memorandum thereof), and the filing of such financing statements, each to be
recorded or filed pursuant to Section 2.01(r) hereof in such places as the
Company shall notify the Trustee prior to the Financing Closing Date, such
documents will have been recorded or filed in each place in which recording or
filing is required to publish notice, under Texas and Ohio Law, of the
interests created thereby and to protect the validity and effectiveness
thereof, and all Taxes, fees and other public charges payable in connection
with the publishing and filing of the Deeds, the ▇▇▇▇ of Sale, the Easement,
26
the Second Easement, and the Lease (or a memorandum thereof), shall be
contemporaneously paid in full by the Company.
(o) [Intentionally omitted]
(p) RIGHTS TO PROPERTY; ETC. (i) The Conveyance
Documents conveyed to the Trustee all rights-of-way, easements and real
property licenses, environmental allowances, rights in real property
(including, without limitation, fixtures and appurtenances), utilities and
other services necessary for the day-to-day operation of the Property and (A)
such rights-of-way, easements, licenses, environmental allowances, utilities
and other services are valid and in full force and effect in accordance with
their terms, (B) there is presently no material default with respect to any
such rights-of-way, easements, licenses, utilities and other services, and (C)
all utility services necessary for the construction of the Improvements and
operation of the Property for its intended purposes are or will be available at
the boundaries of the Parcel.
(ii) None of the Permitted Encumbrances will interfere with
the use or possession of the Property or any other material asset used in
connection therewith or the use of or the exercise by the Trustee of its rights
either under any Operative Document or to the Property.
(iii) The Company has given any and all notices required to
be given in connection with the construction of the Improvements pursuant to
any easements, rights-of-way, licenses or other agreements affecting the Parcel
or the Property, or any part thereof.
(iv) The Plants are situated wholly within the boundary lines
of the Texas Fee Parcels, the Texas Easement Parcels or the Ohio Fee Parcels,
as the case may be, and do not encroach upon any contiguous or adjoining
property; neither Parcel is considered part of a larger zoning or tax lot; the
Improvements do not encroach on any easements or rights-of-way affecting the
Property (except as specifically described in one of the Title Policies), or
violate any rights granted thereunder or any covenants or restrictions
affecting the Property, or any part thereof, and any future violation will not
result in a reversion or forfeiture of title, right of
27
re-entry or power of termination; and the easements, rights-of-way, covenants
and restrictions affecting the Property will not interfere with the use or
occupancy of the Property or any part thereof, or any asset owned or used in
connection therewith, nor will the exercise of rights or remedies thereunder
result in any damage to the Improvements or diminution of value of the
Property, or any part thereof.
(q) TRADE SECRETS AND PATENTS. (i) The ownership of the
Property by the Trustee and the leasing and operation of the Property by the
Company, including the construction and proposed operation of the Improvements,
do not and will not conflict with, infringe on, or otherwise violate any
copyright, trade secret or patent rights of any other Person.
(ii) The Company has all rights to all patents, patent
applications, proprietary computer software, "know-how" and copyrights used or
to be used in the ordinary course of the construction and operation of the
Improvements (the "INTELLECTUAL PROPERTY RIGHTS") that are necessary for the
operation thereof, including the right to assign the Intellectual Property
Rights. There is no judicial proceeding pending (or, to the knowledge of the
Company, threatened) involving any claim of any infringement, misuse or
misappropriation by the Company or any Affiliate thereof of any patent,
copyright, license or similar intellectual property right owned by any third
party related to the Intellectual Property Rights.
(r) ENVIRONMENTAL COMPLIANCE. (i) Except as referenced
in the Disclosed Information and where non-compliance would not have a Material
Adverse Effect, the operations and properties of the Company (other than the
Property) and each of its Subsidiaries comply in all material respects with all
Environmental Laws, all necessary Environmental Permits have been obtained and
are in effect for the operations and properties of the Company and its
Subsidiaries, the Company and its Subsidiaries are in compliance in all
material respects with all such Environmental Permits, and no circumstances
exist that could be reasonably likely to (A) form the basis of an Environmental
Action against the Company or any of its Subsidiaries or any of their
properties that could have a Material Adverse Effect or (B) cause any such
property to be subject to any restrictions on
28
ownership, occupancy, use or transferability under any Environmental Law that
could have a Material Adverse Effect. Except as referenced in the Disclosed
Information, the Property complies in all material respects with all
Environmental Laws; all necessary Environmental Permits have been obtained and
are in effect for the Property and no circumstances exist that could be
reasonably likely to (A) form the basis of an Environmental Action against the
Property or (B) cause the Property to be subject to any restrictions on
ownership, occupancy, use or transferability under any Environmental Law.
(ii) Except as referenced in the Disclosed Information, none
of the properties currently or formerly owned or operated by the Company (other
than the Property) or any of its Subsidiaries is listed or proposed for listing
on the National Priorities List under the CERCLA ("NPL") or on CERCLIS or any
analogous state list of sites requiring investigation or cleanup, the listing,
or proposed listing of which would be reasonably likely to have a Material
Adverse Effect. The Property is not listed or proposed for listing on the NPL
or on CERCLIS or any analogous state list of sites requiring investigation or
cleanup.
(iii) Except as referenced in the Disclosed Information,
except where noncompliance would not individually or in the aggregate have a
Material Adverse Effect, (A) neither the Company nor any of its Subsidiaries
has transported or arranged for the transportation of any Hazardous Materials
to any location that is listed or proposed for listing on the NPL or on the
CERCLIS or any analogous state list, and (B) all Hazardous Materials generated,
used, treated, handled or stored at or transported to or from any property
currently or formerly owned or operated by the Company or any of its
Subsidiaries have been disposed of in compliance with all Environmental Laws
and Environmental Permits. Except as referenced in the Disclosed Information,
all Hazardous Materials generated, used, treated, handled or stored at or
transported to or from the Property have been disposed of in compliance with
all Environmental Permits.
(s) NO CONDEMNATION OR CASUALTY. The Property has not
suffered a Condemnation or a Casualty or any other damage or destruction which
renders the Property
29
unusable in whole or in material part, and, under applicable Law, the Property
may be used for the purposes contemplated by the Company in accordance with the
Lease.
(t) PERMITS. Except as otherwise referenced in the
Disclosed Information, all Permits (including Environmental Permits) that are
or will become Applicable Permits have been obtained, except Applicable Permits
relating to the Financed Improvements customarily obtained or which are
permitted by Law to be obtained after the Financing Closing Date (in which case
the Company, having completed all appropriate diligence in connection
therewith, has no reason to believe that such Permits will not be granted in
the usual course of business prior to the date that such Permits are required
by Law). Except as otherwise referenced in the Disclosed Information, all such
obtained Permits are listed in Schedule 5.17 of the Purchase Agreement and are
in proper form, in full force and effect and not subject to any further appeal
or further contest or to any unsatisfied condition (other than conditions
relating to completion in the future) that may allow modification or
revocation.
(u) INSURANCE. The Company is in compliance with all
Insurance Requirements, and all insurance policies required by paragraph 16 of
the Lease are in full force and effect.
(v) TAXES. All Taxes (other than Excluded Charges), fees
and other charges which have become due and payable in connection with the
execution and delivery of the Operative Documents or any memorandum thereof
have been paid.
(w) COMPLIANCE. Except as referenced in the Disclosed
Information, the Property is in material compliance with all existing
applicable Laws.
(x) NO MATERIAL ADVERSE EVENT. No applicable Law
prohibits, and no litigation, governmental investigation or other proceeding is
pending or, to the Company's knowledge, threatened in which there is a
reasonable possibility of an unfavorable judgment, decree, order or other
determination which could prevent or make unlawful, or impose any material
adverse condition upon, the Property or the acquisition, construction, use,
ownership, operation or leasing thereof, or the Trustee's ownership thereof.
30
(y) FULL DISCLOSURE. The statements and materials
furnished by or on behalf of the Company to the Agent, any Note and/or
Certificate Purchaser, the Trustee or Special Counsel, in connection with any
Operative Document or any transaction contemplated thereby do not contain any
untrue statement of a material fact or omit a material fact necessary to make
the statements contained therein or herein not misleading in light of the
circumstances in which such statements or materials were furnished.
SECTION 4.02. SSBTC REPRESENTATIONS AND WARRANTIES. SSBTC,
in its individual capacity and not as Trustee, represents and warrants (with
the exception of subsection (g), which representation and warranty is made by
SSBTC solely in its trust capacity) to the Company and the Purchasers that the
following statements are and shall be true and correct as of the Financing
Closing Date:
(a) ORGANIZATION AND AUTHORITY. (i) SSBTC is a
Massachusetts trust company duly organized, validly existing and in good
standing under the laws of the Commonwealth of Massachusetts.
(ii) SSBTC has all requisite power and authority to execute
and deliver each Operative Document to which it is a party and to comply with
the terms thereof and perform its obligations thereunder.
(b) PENDING LITIGATION. There are no actions, suits or
Proceedings pending or threatened against or affecting SSBTC in any court or
before any governmental body or arbitration tribunal which, if adversely
determined, would adversely affect the Trustee's ownership of the Property or
the business, condition (financial or otherwise), performance, properties,
prospects or results of operation of SSBTC or the Trustee's ability to perform
its obligations as Trustee under any Operative Document to which it is a party
or any other agreement which it has entered into in connection with any
transaction contemplated by any Operative Document.
(c) AUTHORIZATION; NO CONFLICT. The execution and
delivery by SSBTC of, and compliance by SSBTC with all of the provisions of,
each Operative Document to which it is a party and any other agreement entered
into
31
in connection with any transaction contemplated by the Operative Documents are
within the powers of SSBTC and are authorized by SSBTC and will not conflict
with, result in any breach of any of the provisions of, or constitute a default
under, SSBTC's articles of association or by-laws or any agreement, judgment,
injunction, order, decree or other instrument to which SSBTC is a party or by
which SSBTC may be bound or which is applicable to any of SSBTC's property or
result in a violation of any applicable Massachusetts or Federal Law or in the
creation of any lien on any asset of SSBTC (except as contemplated by the
Operative Documents).
(d) ENFORCEABILITY. Each of the Operative Documents to
which SSBTC is a party, and any other agreement entered into by SSBTC in
connection with any transaction contemplated by any Operative Document, has
been duly authorized by all necessary action on the part of SSBTC, and is the
legal, valid and binding obligation of SSBTC enforceable against SSBTC in
accordance with its terms, except as enforceability thereof may be limited by
the effect of any applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting creditors' rights generally and by general principles
of equity.
(e) NO DEFAULT. No event has occurred and no condition
exists which, upon consummation of the transactions contemplated by any
Operative Document, would constitute a default by SSBTC. SSBTC is not in
violation in any respect of any agreement or any other instrument, nor is SSBTC
in violation of its articles of association or any other instrument to which it
is a party or by which it or any of its property may be bound or affected which
would have a material adverse effect on either the business, financial position
or results of operations of SSBTC or SSBTC's ability to perform its obligations
as Trustee under the Operative Documents.
(f) CONSENTS. The nature of SSBTC, its execution and
delivery of each Operative Document to which it is a party, its consummation of
the transactions contemplated thereby, its compliance with the terms thereof or
any circumstance in connection with the transactions contemplated thereby does
not require the consent of any Person or the approval or authorization of, or
filing, registration or qualification with, any Massachusetts or Federal
governmental authority governing
32
the banking or trust powers of SSBTC on the part of SSBTC (other than such as
have been obtained) as a condition to such execution, delivery and compliance.
(g) ENFORCEABILITY AGAINST TRUSTEE. As of the Financing
Closing Date the Instruments have been duly authorized by all necessary
corporate action on the part of the Trustee and the Instruments (other than the
Series 2 A-Notes and Series 2 B-Notes) constitute, and (upon issuance) the
Series 2 A-Notes and Series 2 B-Notes will constitute, the legal, valid and
binding obligations of the Trustee (acting solely as Trustee under the
Declaration, and not in its individual capacity) and are, or (as applicable)
will be, enforceable against the Trustee in accordance with their terms and the
terms of the Declaration.
ARTICLE V.
COVENANTS
SECTION 5.01. COMPANY'S COVENANTS.
(a) INFORMATION. The Company will deliver to the Agent
for distribution to the Note and Certificate Purchasers:
(i) as soon as available and in any event
within 45 days after the end of each of the first three
quarters of each fiscal year of the Company, consolidated
balance sheets of the Company and its Subsidiaries as of the
end of such quarter and consolidated statements of income and
retained earnings and cash flows of the Company and its
Subsidiaries for the period commencing at the end of the
previous fiscal year and ending with the end of such quarter,
certified by the chief financial officer of the Company;
(ii) as soon as available and in any event
within 90 days after the end of each fiscal year of the
Company, a copy of the annual report for such year for the
Company and its Subsidiaries, containing consolidated
financial statements for such year certified in a manner
acceptable to the Majority Purchasers by KPMG Peat Marwick or
other independent public accountants acceptable to the
Majority Purchasers, together with a certificate of
33
such accountants stating that during the course of their
examination no Default or Event of Default existing at the end
of such fiscal year came to their attention or, if any did
come to their attention, briefly describing the same;
(iii) together with each delivery pursuant to
clause (i) or (ii) above, a certificate of an appropriate
financial officer of the Company setting forth the
computations showing compliance or non-compliance, as the case
may be, with the covenants in Sections 5.01(h), 5.01(i),
5.01(j) and 5.01(n) which certificate shall be in form and
detail reasonably satisfactory to the Purchasers and shall
include such officer's certification that he knows of no
Default or Event of Default then existing or, if any does
exist, a brief description thereof and of the Company's
intentions in respect thereof;
(iv) as soon as possible and in any event
within five days after the occurrence of each Default and
Event of Default continuing on the date of such statement, a
statement of the chief financial officer of the Company
setting forth details of such Default or Event of Default and
the action which the Company has taken and proposes to take
with respect thereto;
(v) promptly after the sending or filing
thereof, copies of (A) each Form 10-K, Form 10-Q, Form 8-K or
similar document filed by the Company with the Securities and
Exchange Commission, (B) each effective registration statement
or generally distributed preliminary prospectus filed by the
Company with the Securities and Exchange Commission, but not
including any relating solely to employee benefit plans, and
(C) each proxy statement, annual or quarterly report or other
document sent by the Company to holders of its common stock;
(vi) promptly and in any event within five
days after the receipt thereof by the Company or any of its
Subsidiaries, a copy of each notice, citation or other
communication from the United States Environmental Protection
Agency, any state environmental protection agency, any court
or any other governmental Person, and of each consent
agreement, consent decree, judgment or other
34
document with any such Person, in each case asserting an
actual or potential violation, fine, penalty, enforcement
action or liability of the Company or any Subsidiary under any
law or regulation relating to environmental protection,
hazardous or toxic substances or contaminated materials, the
effect or adverse determination of which would have a Material
Adverse Effect;
(vii) promptly after the commencement thereof,
notice of the commencement and nature of all actions and
proceedings before any court, governmental agency or
arbitrator affecting the Company or any of its Subsidiaries of
the type described in Section 4.01(e);
(viii) promptly and in any event within 10 days
after the Company or any of its ERISA Affiliates knows or has
reason to know that any ERISA Event has occurred, a statement
of an officer of the Company having knowledge of or
responsibility for such matters describing such ERISA Event
and the action, if any, that the Company or such ERISA
Affiliate has taken and proposes to take with respect thereto;
(ix) promptly and in any event within seven
Business Days after receipt thereof by the Company or any of
its ERISA Affiliates, copies of each notice from the PBGC
stating its intention to terminate any Plan or to have a
trustee appointed to administer any such Plan;
(x) promptly and in any event within 30 days
after the receipt thereof by the Company or any of its ERISA
Affiliates, a copy of the latest annual actuarial report for
each Plan if the ratio of the fair market value of the assets
of such Plan to its current liability (as defined in Section
412 of the Code) is less than 60%;
(xi) promptly and in any event within five
Business Days after receipt thereof by the Company or any of
its ERISA Affiliates from the sponsor of a Multiemployer Plan,
copies of each notice concerning (A) the imposition of
Withdrawal Liability by any such Multiemployer Plan, (B) the
reorganization or termination, within the meaning of Title IV
of
35
ERISA, of any such Multiemployer Plan or (C) the amount of
liability incurred, or that may be incurred, by the Company or
any of its ERISA Affiliates in connection with any event
described in clause (A) or (B); and
(xii) such other information respecting the
condition or operations, financial or otherwise, of the
Company or any of its Subsidiaries as any Purchaser or the
Trustee through the Agent may from time to time reasonably
request.
(b) COMPLIANCE WITH ENVIRONMENTAL LAWS. The
Company will comply, and cause other Persons operating or occupying its
properties to comply, in all material respects, with all applicable
Environmental Laws now existing or hereinafter enacted and Environmental
Permits with respect to the Property; obtain and renew all Environmental
Permits necessary for ownership and operation of the Property; and conduct any
investigation, study, sampling and testing, and undertake any cleanup, removal,
remedial or other action necessary to remove and clean up all Hazardous
Materials from any of the Property pursuant to the lawful order of any
regulatory authority and generally in accordance with the requirements of all
Environmental Laws.
(c) MAINTENANCE OF PROPERTY; INSURANCE;
AS-BUILT SURVEY. (i) The Company will keep, and will cause each of its
Subsidiaries to keep, all property used or useful in its business in good
working order and condition, ordinary wear and tear excepted, except where the
failure to do so would not have a Material Adverse Effect.
(ii) The Company will, and will cause each
of its Subsidiaries to, maintain (either in the name of the Company or in such
Subsidiary's own name) with insurance companies with a Best's rating of A or
better, insurance on all of its properties in at least such amounts and against
at least such risks (and with such risk retention) as the Company in good faith
determines is necessary or appropriate for the prudent management of its
business; and will furnish to the Purchasers, upon request from the Agent,
information presented in reasonable detail as to the insurance so carried.
36
(iii) The Company will deliver to the Agent promptly
after the occurrence of the Final Completion Date, the final as- built plans
and specifications of the Improvements (which in any event shall be provided to
Agent within ninety (90) days after the Final Completion Date).
(d) CONDUCT OF BUSINESS AND MAINTENANCE OF
EXISTENCE. (i) The Company will continue to engage in business of the same
general type as now conducted by the Company and its Subsidiaries, and will
preserve, renew and keep in full force and effect its rights, privileges and
franchises necessary or desirable in the normal conduct of its business to the
extent permitted by Law.
(ii) The Company will preserve and keep in full force
and effect its corporate existence.
(e) COMPLIANCE WITH LAWS. The Company will
comply, and cause each of its Subsidiaries to comply, in all material respects
with all applicable Laws, if non-compliance would have a Material Adverse
Effect; such compliance shall include, without limitation, paying before the
same become delinquent all taxes, assessments and governmental charges imposed
upon it or upon its property; PROVIDED, HOWEVER, that in the event of any
alleged non-compliance, no such Person shall be in violation of this
subsection: (i) if within thirty (30) days after such non-compliance becomes
apparent or is alleged, appropriate corrective measures are commenced and such
measures are diligently pursued to the satisfaction of the applicable court,
agency or governmental authority; or (ii) if and as long as such alleged
non-compliance is being contested in good faith by timely and appropriate
proceedings.
(f) BOOKS AND RECORDS. The Company will keep,
and cause each of its domestic Subsidiaries to keep, proper books of record and
account in which entries in conformity with GAAP shall be made of all financial
transactions and the assets and business of the Company and each such domestic
Subsidiary.
(g) USE OF PROCEEDS; APPLICATION OF PROCEEDS TO
ACTUAL PROJECT COSTS. The Company, as the Construction Agent, will use
proceeds of the Advances received by it solely to pay Actual Project Costs, and
none of such proceeds will be used in violation of any
37
applicable Law, including, without limitation, Regulation G, Regulation T,
Regulation U and Regulation X. The Company shall apply the proceeds of all
Advances solely to Actual Project Costs.
(h) NEGATIVE PLEDGE. (i) The Company will not create, or
suffer to exist, and will not permit any Subsidiary organized in the United
States of America to create or suffer to exist, any Lien upon or with respect
to any of its properties, whether owned at the Financing Closing Date or
thereafter acquired, other than Permitted Liens.
(i) FINANCIAL COVENANTS.
(i) WORKING CAPITAL. Maintain
an excess of consolidated current assets over consolidated
current liabilities of the Company and its Subsidiaries of not
less than $125,000,000. Consolidated current liabilities
shall not include the current portion of the indebtedness
evidenced by the Notes issued under the Revolving Credit
Agreement.
(ii) TANGIBLE NET WORTH.
Maintain an excess of consolidated total tangible assets over
consolidated total liabilities (including Guaranties) of the
Company and its Subsidiaries of not less than the Required Net
Worth. The "Required Net Worth" shall initially be
$208,991,000 and shall increase as of December 31 of each
year, commencing December 31, 1995, by an amount equal to 25%
of the consolidated net income (if any) of the Company and its
Subsidiaries for the fiscal year ending on such December 31.
(iii) TANGIBLE NET WORTH RATIO.
Maintain a ratio of consolidated total liabilities (including
Guaranties but excluding the Transition Obligation) to the sum
of (i) consolidated tangible net worth of the Company and its
Subsidiaries plus (ii) an amount (in no case greater than
fifty-five million dollars ($55,000,000)) equal to the
goodwill acquired by the Company from Synpro, as part of the
Company's acquisition of all or substantially all of the
assets of Synpro of not more than 1.85 to 1.00.
38
(iv) INTEREST COVERAGE RATIO.
Maintain, for each period of four consecutive fiscal quarters,
beginning with the four fiscal quarters ending December 31,
1995, a ratio of consolidated net income (before interest
income, interest expense and income taxes) of the Company and
its Subsidiaries for such period to consolidated interest
expense (net of interest income) for such period of not less
than 2.5 to 1.0.
(j) MERGERS, ASSETS SALES, ETC. The
Company shall not (i) merge or consolidate with or into, or (ii) sell, assign,
lease or otherwise dispose of (whether in one transaction or in a series of
transactions and including, without limitation, by sale of capital stock of the
Person owning such assets), in any period of twelve (12) consecutive calendar
months, assets having an aggregate book value (net of liabilities assumed) on
the consolidated balance sheet of the Company and its Subsidiaries in excess of
$100,000,000 for the Company and its Subsidiaries taken as a whole, except for
sales in the ordinary course of business), or permit any of its Subsidiaries to
do so, except that (i) any Subsidiary of the Company may merge or consolidate
with or into, or dispose of assets to, any other Subsidiary of the Company, and
(ii) any Subsidiary of the Company may merge into or dispose of assets to the
Company and the Company may merge with any other Person so long as the Company
is the surviving corporation, PROVIDED, in each case, that no Default or Event
of Default shall have occurred and be continuing at the time of such proposed
transaction or would result therefrom.
(k) ACCOUNTING CHANGES. The Company shall not
make or permit, or permit any of its Subsidiaries to make or permit, any change
in accounting policies or reporting practices, except as required or permitted
by GAAP.
(l) PERFORMANCE. The Company shall observe and
perform all provisions to be observed or performed by it contained in each
Operative Document to which it is a party, in accordance with the terms thereof
and within the times permitted thereby (including any grace or cure periods
provided thereby) so as to prevent the occurrence of an Event of Default, and
will maintain, or cause to be maintained, the validity and effectiveness as to
the Company of each such Operative Document to which it is a party.
39
(m) INTELLECTUAL PROPERTY RIGHTS. The Company shall
preserve, protect and maintain its rights in and to the Intellectual Property
Rights in accordance with prudent industry practice.
(n) DIVIDENDS. The Company shall not declare or make any
dividend payment or other distribution of assets, properties, cash, rights,
obligations or securities on account of any shares of any class of capital
stock of the Company, now or hereafter outstanding, except that the Company may
(i) declare and make any dividend payment or other distribution payable in
common shares of the Company and (ii) declare or pay cash dividends to its
shareholders in an aggregate amount not in excess of the sum of $55,000,000
plus 50% of consolidated net income of the Company and its subsidiaries arising
after December 31, 1989 and computed on a cumulative consolidated basis (with
losses, if any, taken into account), PROVIDED that, immediately after giving
effect to such proposed action, no Default or Event of Default would exist.
(o) APPROVED CONSTRUCTION BUDGET AND RELATED MATTERS.
The Approved Construction Budget shall be prepared in good faith on the basis
of reasonable assumptions and shall accurately include all Actual Project Costs
anticipated to be incurred or estimated to be incurred and all reserves
expected to be established and maintained in connection with achieving
completion of the Improvements by the Final Completion Date. The Construction
Schedule shall accurately describe estimated dates of completion of the stages
of construction of the Improvements.
ARTICLE VI.
THE NOTES AND THE CERTIFICATES
------------------------------
SECTION 6.01. DETERMINATION OF RATES.
(a) All computations of interest and of any fee payable
hereunder or under any other Operative Document (other than computations made
for purposes of determining the Maximum Rate) shall be made by the Agent on the
basis of a year of 360 days (365 days in the case of the computation of
interest if the Applicable Rate is determined by reference to the Base Rate),
for the actual number of days (including the first day but excluding the
40
last day) occurring in the period for which such interest or fee is payable.
Each determination by the Agent of an interest rate hereunder or under any
other Operative Document shall be conclusive and binding for all purposes,
absent manifest error, but no such interest rate shall ever exceed the Maximum
Rate.
(b) The Company shall notify the Agent two Business Days
before each Interest Setting Date as to the Interest Period or Periods selected
by the Company subject to the limitations set forth in the definition of
Interest Period. On each Interest Setting Date, the Agent shall calculate the
LIBO Rate. Upon determination of the LIBO Rate on the Interest Setting Date,
the Agent shall promptly notify the Purchasers and the Trustee of the LIBO Rate
for the applicable Interest Period.
(c) In the event, and on each occasion, that on the
Interest Setting Date the Agent shall have received notice from any Note
Purchaser of such Purchaser's determination (which determination shall be
conclusive and binding upon the Trustees and the Company absent manifest error)
(i) that United States dollar deposits in the amount of the principal of and
for the relevant Interest Period for such Purchaser's Notes are not generally
available in the London interbank market or (ii) that the rate at which such
dollar deposits are being offered would not adequately and fairly reflect the
cost to such Purchaser of making or maintaining the principal of such Notes
during the relevant Interest Period if the Applicable Rate were to be
determined by reference to the LIBO Rate, then the Agent shall, as soon as
practicable thereafter, give written, telex or facsimile notice of such
determination to the Company, the Trustee and the other Purchasers and in the
case of a determination pursuant to clause (ii) above only, such Purchaser
shall deliver a certificate to the Agent and the Company describing in
reasonable detail the calculations of such Purchaser pursuant to which it made
such determination and stating that such Purchaser is making such determination
on a basis consistent with its treatment of other similar situations, and
thereafter the Applicable Rate on the Notes held only by such Purchaser shall
be determined by reference to an appropriate substitute rate to be negotiated
in good faith by the Company, the Agent and such Purchaser as promptly as
practicable or, failing agreement on an appropriate substitute rate, the Base
Rate, but in no event to exceed
41
the Maximum Rate, until the circumstances giving rise to such notice no longer
exist.
(d) In the event, and on each occasion, that on the
Interest Setting Date the Agent shall have determined (which determination
shall be conclusive and binding upon the Company absent manifest error) that
reasonable means do not exist for ascertaining the LIBO Rate for purposes of
determining the Applicable Rate, then the Agent shall, as soon as practicable
thereafter, give written, telex or facsimile notice of such determination to
the Company, the Purchasers and the Trustee, and thereafter the Applicable Rate
on the Instruments shall be determined by reference to an appropriate
substitute rate to be negotiated in good faith by the Company, the Agent and
the Purchasers (the "SUBSTITUTE RATE") as promptly as practicable or, failing
agreement on the Substitute Rate, the Base Rate, but in no event to exceed the
Maximum Rate, until the circumstances giving rise to such notice no longer
exist.
(e) In the event that, subsequent to the Financing
Closing Date, the introduction of or any change in any United States or foreign
Law, or the interpretation or application thereof, makes it unlawful, or any
central bank or other governmental authority having jurisdiction asserts that
it is unlawful, for any Purchaser (including any branch, subsidiary or
Affiliate office of such Purchaser from which the Instruments are actually
funded or at which the Instruments are actually maintained or held) to fund or
maintain and/or to continue to hold the Instruments if the Applicable Rate
thereon is determined with respect to the LIBO Rate, then the Applicable Rate
on such Instruments shall be converted automatically to the Base Rate plus the
Applicable Margin (but in no event to exceed the Maximum Rate) on and after the
last day of the applicable Interest Period or on and after such earlier date as
may be required by such Law. As soon as practicable thereafter, the Company,
the Agent and the Purchasers shall negotiate a Substitute Rate.
(f) Upon the occurrence and during the continuance of an
Event of Default arising from the nonpayment of the Company's obligations
hereunder, the Applicable Rate on the Instruments shall automatically be
converted to the Base Rate.
42
SECTION 6.02. ASSIGNMENTS AND PARTICIPATIONS. (a)
The Company may not assign its rights or delegate its obligations under this
Agreement without the prior written consent of the Agent and all of the
Purchasers. Upon an assignment to and assumption by a Person of the rights and
obligations of the Company under and in compliance with this Agreement, the
representations, warranties and covenants of the Company and the conditions
applicable to the Company hereunder shall thereafter apply to such Person and
not to the Company.
(b) In addition to the assignments permitted under
Section 6.02(h), each Note Purchaser and each Certificate Purchaser may assign
to one or more Eligible Assignees all or a portion of the Instruments then held
by it and its rights and obligations thereunder and under this Agreement
(including, without limitation, all or a portion of its Interim Note Commitment
and Certificate Commitment and/or the Advances under its Interim Notes and/or
its Investment under its Certificates) and the other Operative Documents;
PROVIDED, HOWEVER, that (i) each assignment shall be of a constant, and not a
varying, percentage of all such rights and obligations; (ii) each such
assignment of Notes shall be of a pro rata share of each series of Notes then
held by such Note Purchaser; (iii) the aggregate principal amount of the Notes
being assigned pursuant to each such assignment (determined as of the date of
the Assignment and Acceptance with respect to such assignment) shall in no
event be less than $5 million in original principal amount and in integral
multiples of $1 million in excess thereof; (iv) no such assignment shall be
made if as a result thereof any Purchaser's aggregate Interim Note Commitment,
after giving effect to such assignment, are less than $5 million (determined as
of the date of the Assignment and Acceptance with respect to such assignment);
PROVIDED, HOWEVER, that this Section 6.02(b)(iii)-(iv) shall not prohibit an
assignment of the entire outstanding principal amount of the Notes then held by
a Purchaser; and (v) the parties to each such assignment shall execute and
deliver to each of the Agent, with (if requested by the Agent) an
administrative fee to be paid by the Assignor (as defined below) of $3,000, and
the Trustee for its acceptance and recording in the Record or the Register as
the case may be, an Assignment and Acceptance; PROVIDED, HOWEVER, the
requirements of Sections 6.02(b)(i)-(iv) shall not apply with respect to
assignments to such Purchaser's
43
Affiliates or to any financial institutions to which the Note Purchaser is
assigning Notes as collateral security pursuant to Regulation A of the Federal
Reserve Board and any operating circular issued by the Federal Reserve System
and/or the Federal Reserve Bank or otherwise. Upon such execution, delivery,
acceptance and recording, from and after the effective date specified in each
Assignment and Acceptance (which effective date shall be at least five Business
Days after the execution of such Assignment and Acceptance, or with respect to
an Assignment and Acceptance for Certificates, such earlier date as the
Assignor and Assignee shall agree), (x) the assignee thereunder (the
"ASSIGNEE") shall be a party hereto and to the other Operative Documents to
which the Purchasers are parties and, to the extent that rights and obligations
hereunder have been assigned to and assumed by it, have the rights and
obligations of a Purchaser hereunder and a Holder of Instruments under the
Operative Documents (including the obligation of confidentiality set forth in
Section 9.17) and (y) the assignor thereunder (the "ASSIGNOR") shall, to the
extent that rights and obligations hereunder have been assigned by it,
relinquish its rights (other than any rights to indemnification it may have
hereunder or under the Operative Documents) and be released from its
obligations under this Agreement (other than the confidentiality
obligations set forth in Section 9.17) and the other Operative Documents with
respect to all or such portion, as the case may be, of its Interim Note and/or
Certificate Commitments (and, in the case of an Assignment and Acceptance
covering all or the remaining portion of Assignor's rights and obligations
under the Agreement and the other Operative Documents, such Assignor shall,
except as set forth above, cease to be a party hereto). To the extent that the
Certificate Purchaser is an Assignor, the term "CERTIFICATE PURCHASER," as used
in the Operative Documents, shall refer to each Holder of the Certificates and
the obligations of each Certificate Purchaser hereunder shall be several and
not joint and several.
(c) By executing and delivering an Assignment and
Acceptance, the Assignor thereunder and the Assignee thereunder confirm to and
agree with each other and the other parties hereto as follows: (i) other than
as provided in such Assignment and Acceptance, such Assignor makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties
44
or representations made in or in connection with this Agreement and the other
Operative Documents or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement, the other Operative
Documents or any other instrument or document furnished pursuant hereto; (ii)
such Assignor makes no representation or warranty and assumes no responsibility
with respect to the financial condition of the Company or the Construction
Agent or the performance or observance by the Company or the Construction Agent
of any of their respective obligations under this Agreement or any other
Operative Document, or any other instrument or document furnished pursuant
hereto; (iii) such Assignee confirms that it has received a copy of this
Agreement, together with copies of the financial statements referred to in
Section 4.01(d) and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision with respect to
entering into such Assignment and Acceptance; (iv) such Assignee will,
independently and without reliance upon the Agent, the Company, the Trustee,
such Assignor or any other Note or Certificate Purchaser and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement; (v) such Assignee confirms that it is an Eligible Assignee; (vi)
such Assignee appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement and the other
Operative Documents as are delegated to the Agent by the terms hereof and
thereof, together with such powers as are reasonably incidental thereto; and
(vii) such Assignee agrees that it will perform in accordance with their terms
all of the obligations which by the terms of this Agreement are required to be
performed by it as a Note and/or Certificate Purchaser.
(d) The Agent shall maintain at its address listed on
Schedule I hereto a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and addresses of
the Note and Certificate Purchasers and the Commitment of, and principal amount
of the Advances and stated amount of the Investment owing to, each Note and
Certificate Purchaser from time to time (the "RECORD"). The entries in the
Record shall be conclusive and binding for all purposes, absent manifest error,
and the Company, the Agent, the Trustee and the Note and Certificate
45
Purchasers may treat each Person whose name is recorded in the Record as a Note
and/or Certificate Purchaser hereunder for all purposes of this Agreement. The
Record shall be available for inspection by the Company or any Note or
Certificate Purchaser at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance
executed by an Assignor and an Assignee representing that it is an Eligible
Assignee, the Agent shall, if such Assignment and Acceptance has been completed
give prompt oral or written notice to the Company and the Trustee and (i)
accept such Assignment and Acceptance, and (ii) record the information
contained therein in the Record. The Agent shall provide the Company with a
current list of all Purchasers no less frequently than quarterly.
(f) Each Note and Certificate Purchaser may sell
participations to one or more banks or other entities in or to all or a portion
of the Instruments then held by it and its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment
and the Instrument or Instruments held by it) and the other Operative
Documents; PROVIDED, HOWEVER, that (i) such Purchaser's obligations under this
Agreement and the other Operative Documents (including without limitation all
or a portion of its Interim Note Commitment to make Advances)
shall remain unchanged; (ii) such Note or Certificate Purchaser shall remain
the Holder of any such Instrument for all purposes under this Agreement and the
other Operative Documents and the Company, the Agent, the Trustee, and the
other Note and Certificate Purchasers shall continue to deal solely and
directly with such Purchaser in connection with such Purchaser's rights and
obligations under this Agreement; (iii) no such participant shall be entitled
to receive any greater payment than such Purchaser would have been entitled to
receive with respect to the rights participated (including, without limitation,
payments for Taxes, Other Charges or Increased Costs) except as a result of
circumstances arising after the date of such participation to the extent that
such circumstances affect other Note or Certificate Purchasers and participants
generally; and (iv) no Note or Certificate Purchaser shall assign or grant a
participation that conveys to the participant the right to vote or consent
under this Agreement, other than
46
the right to vote upon or consent to any reduction of the principal or stated
amount of or the interest or Distributions to be paid on such Purchaser's
Instrument(s) or any postponement of any date for the payment of any amount
payable in respect of such Purchaser's Instruments.
(g) Any Note or Certificate Purchaser may, in connection
with any assignment or participation or proposed assignment or participation
pursuant to this Section 6.02, disclose to the assignee or participant or
proposed assignee or participant, any information relating to the Company
furnished to such Note or Certificate Purchaser by or on behalf of the Company;
PROVIDED, that prior to any such disclosure, the assignee or participant or
proposed assignee or participant shall agree in writing with the Company and
the Agent to preserve the confidentiality of any confidential information
relating to the Company or the transactions contemplated by this Agreement
(including, without limitation, the general structure of this transaction)
received by it from such Note or Certificate Purchaser in a manner consistent
with that set forth in Section 9.17 hereof.
(h) Anything in this Section 6.02 to the contrary
notwithstanding (except that at all times the requirements of Section 6.02(g)
shall be satisfied), any Note Purchaser may assign and pledge, as collateral or
otherwise, and without notice to or consent of the Company, all or any of the
Notes held by it and any of its rights (including, without limitation, rights
to payment of the principal of and interest on the Notes) under this Agreement
to (i) any of its Affiliates and (ii) any Federal Reserve Bank, the United
States Treasury or to any other financial institution as collateral security
pursuant to Regulation A of the Federal Reserve Board and any operating
circular issued by the Federal Reserve System and/or the Federal Reserve Bank
or otherwise; PROVIDED, that any payment made by the Company to the Trustee for
the benefit of such assigning and/or pledging Purchaser in accordance with the
terms of the Operative Documents shall satisfy the Company's obligations under
the Operative Documents in respect thereof to the extent of such payment. No
such assignment and/or pledge set forth in (ii) above shall release the
assigning and/or pledging Note Purchaser from its obligations hereunder.
47
SECTION 6.03. TAXES. (a) Any and all payments by the
Company, the Trustee or the Agent hereunder or under any of the other Operative
Documents (including, without limitation, payments of Fixed Rent, Additional
Rent, interest, Distributions, fees and principal and stated amounts of the
Instruments) shall be made free and clear of and without deduction for any and
all present or future Impositions and all liabilities with respect thereto,
excluding, in the case of payments made to each Purchaser, the Agent or the
Trustee, as the case may be, Excluded Charges. Deduction may be made, if
required to be made by Law, in the case of payments made to each Purchaser, the
Agent or the Trustee, as the case may be, for each of the Excluded Charges.
If the Company, the Agent or the Trustee shall be required by
Law to deduct any Charges from or in respect of any sum payable hereunder or
under any of the Operative Documents to the Trustee, the Agent or any
Purchaser, (i) the sum payable by such deducting party shall be increased as
may be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 6.03) the
Trustee, the Agent or such Purchaser, as the case may be, receives an amount
equal to the sum it would have received had no such deductions been made, (ii)
the Company, the Agent or the Trustee, as the case may be, shall make such
deductions, and (iii) the Company, the Agent or the Trustee as the case may be,
shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable Law. The Company will indemnify the
Agent and the Trustee for the full amount of any sums paid by the Agent and the
Trustee pursuant to the preceding sentence.
(b) Notwithstanding anything to the contrary contained in
this Agreement, each of the Company, the Agent and the Trustee shall be
entitled, to the extent it is required to do so by Law, to deduct or withhold
income or other similar Taxes imposed by the United States of America or any
other jurisdiction on Fixed Rent, Additional Rent, interest, Distributions,
fees, principal and stated amounts of the Instruments or other amounts payable
hereunder or under the other Operative Documents for the account of the
Trustee, the Agent or any Purchaser (without the payment of increased amounts
to such Purchaser, the Agent or the Trustee pursuant to clause (a) of this
Section 6.03 in the case of Excluded
48
Charges) unless the Trustee (or any successor thereto) or a Purchaser, as the
case may be, has timely filed with the Agent (who shall then promptly forward
the same to the Company and the Trustee) the Prescribed Forms for the
applicable year to the extent deduction or withholding of such Taxes is not
required or reduced as a result of the filing of such Prescribed Forms. If the
Agent or the Trustee shall so deduct or withhold any such Taxes, it shall
provide a statement to such Purchaser, and if the Company shall so deduct or
withhold any such Taxes, it shall provide a statement to the Trustee, in each
case setting forth the amount of such Taxes so deducted or withheld, the
applicable rate and any other information or documentation which such Purchaser
or the Trustee may reasonably request for assisting such Purchaser or the
Trustee to obtain any allowable credits or deductions for the Taxes so deducted
or withheld in the jurisdiction or jurisdictions in which such Purchaser is
subject to Taxes.
(c) In addition, the Company agrees to pay and/or
reimburse any present or future stamp or documentary Taxes or any other excise
or property Taxes payable by or on behalf of the Agent, the Trustee or any
Purchaser, including any transfer Taxes with respect to the Trustee's
acquisition of the Property or other property transfer, transfer gains or
mortgage recording Taxes, charges or similar levies which arise from the
acquisition, ownership, operation, occupancy, possession, use, non-use,
financing, leasing or disposition or condition of the Property or any part
thereof by the Trustee or from any payment made to the Agent, the Trustee or
any Purchaser hereunder or under the other Operative Documents or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement or any of the other Operative Documents and arising directly or
indirectly out of the transactions contemplated by this Agreement or any of the
Operative Documents (hereinafter referred to as "OTHER TAXES").
(d) The Company will indemnify the Trustee, the Agent and
each Note and Certificate Purchaser for the full amount of any Charges
(including, without limitation, any Other Taxes imposed by any jurisdiction on
amounts payable under this Section 6.03) paid by the Trustee, the Agent or such
Purchaser as the case may be, and any liability (including penalties, interest
and expenses) arising therefrom or with respect thereto,
49
whether or not such Charges were correctly or legally asserted (it being the
intent to indemnify the Trustee, the Agent and the Purchasers with respect to
Charges resulting from such Person's own negligence). Payments under this
indemnification shall be made within 30 days from the date such Purchaser, the
Agent or the Trustee, as the case may be, makes written demand therefor, which
demand shall include a receipt or a reasonably detailed statement of such
Charges. In no event shall the Company, in connection with this indemnity or
for any other purpose whatsoever under any Operative Document, have any right
to examine any tax return or related books and records of the Trustee, the
Agent or of any Note or Certificate Purchaser.
(e) As soon as practicable but in any event within 15
days after the date of the payment of Charges by the Company, the Company will
furnish to the Trustee the original or a certified copy of a receipt or other
similar instrument (if available) evidencing payment thereof. Should any
Purchaser, the Agent or the Trustee receive any refund, credit or deduction
from any taxing authority (whether before or after payment in full of the
principal and stated amount of, and interest on and Distributions with respect
to, the Instruments) to which such Purchaser, the Agent or the Trustee, as the
case may be, would not be entitled but for the payment by the Company of
Charges as required by this Section 6.03 (it being understood that the decision
whether to make a claim, and if claimed, as to the amount of any such refund,
credit or deduction shall be made by such Purchaser, the Agent or the Trustee
in its sole discretion; such Purchaser, the Agent or the Trustee, as the case
may be, thereupon shall repay, together with any interest paid or allowed by
the refunding, crediting or deducting taxing authority in connection with such
refund, credit or deduction, to the Company an amount with respect to such
refund, credit or reduction equal to any net reduction in Taxes actually
obtained by such Purchaser, the Agent or the Trustee, as the case may be, and
determined by such Purchaser, the Agent or the Trustee, as the case may be, in
its sole discretion to be attributable to such refund, credit or deduction.
(f) Each Note Purchaser organized under the laws of a
jurisdiction outside the United States, on or prior to the date of its
execution and delivery of this Agreement in the case of each initial Note
Purchaser and
50
on the date of the Assignment and Acceptance pursuant to which it becomes a
Note Purchaser in the case of each other Note Purchaser, and from time to time
thereafter if requested in writing by the Company (but only so long as such
Note Purchaser remains lawfully able to do so), shall provide the Company with
Internal Revenue Service form 1001 or 4224, as appropriate, or any successor or
other form prescribed by the Internal Revenue Service, certifying that such
Note Purchaser is exempt from or entitled to a reduced rate of United States
withholding tax on payments of interest pursuant to this Agreement or the
Notes. If the form provided by a Note Purchaser at the time such Note
Purchaser first becomes a party to this Agreement indicates a United States
interest withholding tax rate in excess of zero, withholding tax at such rate
shall be considered excluded from Taxes. If any form or document referred to
in this subsection (e) requires the disclosure of information, other than
information necessary to compute the tax payable and information required on
the date hereof by Internal Revenue Service form 1001 or 4224, that the Note
Purchaser reasonably considers to be confidential, the Note Purchaser shall
give notice thereof to the Company and shall not be obligated to include in
such form or document such confidential information to the extent permitted by
law.
(g) Without prejudice to the survival of any other
agreement of the Company, the Trustee, the Agent or the Purchasers hereunder,
the agreements and obligations of the Company, the Trustee, the Agent and the
Purchasers contained in this Section 6.03 shall survive the payment in full of
both the principal of and interest on the Notes and the Certificate Liquidation
Amount of the Certificates.
SECTION 6.04. SUBSTITUTION OF PURCHASER. If (i) any Note
Purchaser shall have converted the basis for determining the Applicable Rate on
its Instruments from the LIBO Rate to Base Rate pursuant to Section 6.01(c) or
(e) or shall have required the payment of Reserve Costs or Increased Costs, or
(ii) any Note or Certificate Purchaser shall have required the payment of
Charges or Other Taxes, the Company shall have the right, after consultation
and discussion with the Agent, to seek a substitute purchaser or purchasers
satisfactory to the Company (which may be one or more of the Note or
Certificate Purchasers) to assume the Note and/or
51
Certificate Commitments of such Purchaser and to purchase the Instruments held
by such Purchaser (without recourse to or warranty by such Purchaser and
subject to all amounts owing to such Purchaser under this Agreement having been
paid in full).
SECTION 6.05. SHARING OF PAYMENTS, ETC. If any Note or
Certificate Purchaser shall obtain any payment (whether voluntary or
involuntary), on account of the Instruments held by it (other than on account
of Reserve Costs, Funding Costs, Break Costs, Illegality Costs or Increased
Costs and other than pursuant to Section 6.03 or any indemnification provision
of the Operative Documents) in excess of its ratable share of payments on
account of the Instruments obtained by all the Note and Certificate Purchasers,
such Purchaser shall forthwith purchase from the other Note and Certificate
Purchasers such participations in the Instruments held by them as shall be
necessary to cause such purchasing Purchaser to share the excess payment
ratably with each of them; PROVIDED, HOWEVER, that if all or any portion of
such excess payment is thereafter recovered from such purchasing Purchaser,
such purchase from each Note and Certificate Purchaser shall be rescinded and
each Note and Certificate Purchaser shall repay to the purchasing Purchaser the
purchase price to the extent of such Purchaser's ratable share (according to
the proportion of (i) the amount of the participation purchased from such
Purchaser as a result of such excess payment to (ii) the total amount of the
participations purchased in respect of such excess payment) of such recovery
together with an amount equal to such Purchaser's ratable share (according to
the proportion of (i) the amount of such Purchaser's required repayment to (ii)
the total amount so recovered from the purchasing Purchaser) of any interest or
other amounts paid or payable by the purchasing Purchaser in respect of the
total amount so recovered. Notwithstanding that the Purchaser shall have
purchased a participation in such Instruments, the purchasing Purchaser shall
be deemed to have acquired the voting rights under such Instruments to the
extent of, and for the duration of, such participation, as if such Purchaser
shall have been an Assignee thereof.
SECTION 6.06. TAX TREATMENT. (a) The parties hereto agree
that it is the Company's intention that for Federal, state and local income Tax
purposes (i) the Lease be treated as the repayment and security provisions
52
of a loan by the Trustee to the Company, (ii) the Lessee be treated as the
legal and beneficial owner entitled to any and all benefits of ownership of the
Property or any part thereof and (iii) all payments of Fixed Rent during the
Term be treated as payments of interest and principal, as the case may be.
(b) The Company agrees that neither it nor any member of
any affiliated group of which it is or may become a member (whether or not
consolidated or combined returns are filed for such affiliated group for
Federal, state or local income Tax purposes) will at any time take any action,
directly or indirectly, or file any return or other document inconsistent with
the intended income Tax treatment set forth in Section 6.06(a) hereof, and the
Company agrees that the Company and any such Affiliates will file such returns,
maintain such records, take such actions and execute such documents as may be
appropriate to facilitate the realization of such intended income Tax
treatment.
(c) Each of the Trustee, the Agent and the Note and
Certificate Purchasers agrees that neither it nor any member of any affiliated
group of which it is or may become a member (whether or not consolidated or
combined returns are filed for such affiliated group for Federal, state or
local income Tax purposes) will at any time take any action, directly or
indirectly, or file any return or other document claiming, or asserting that it
is entitled to the income Tax benefits, deductions and/or credits which,
pursuant to the intended income Tax treatment set forth in Section 6.06(a)
hereof, would otherwise be claimed or claimable by the Company, and that it and
any such Affiliates will file such returns, maintain such records, take such
actions, and execute such documents (as reasonably requested by the Company
from time to time) as may be appropriate to facilitate the realization of, and
as shall be consistent with, such intended income Tax treatment, other than
engaging in any contest of such treatment with any taxing authority, and if any
such filing, maintenance, action or execution requested by the Company would
result in any additional income Tax liability payable by it or any Affiliate,
or could reasonably be expected to result in liability payable by it or any
Affiliate, other than any liability related to or arising as a result of the
intended income Tax treatment set forth in Section 6.06(a) hereof, then the
Company will provide an indemnity against such
53
unrelated income Tax liability or other liability satisfactory to the Trustee,
the Agent or the Note and Certificate Purchaser, as the case may be, in its
sole opinion.
ARTICLE VII.
EVENTS OF DEFAULT AND UNWIND EVENTS
SECTION 7.01. EVENTS OF DEFAULT. If any of the following
events shall occur and be continuing, it shall constitute an "EVENT OF DEFAULT"
hereunder:
(a) The Company shall (i) fail to observe or perform any
covenant contained in Sections 5.01(a)(iii), 5.01(d)(ii), 5.01(h), 5.01(i),
5.01(j) or 5.01(n) hereof, (ii) not comply with any of its payment obligations
under Section 9.15(c) hereof within five Business Days after its receipt of a
written demand by an Indemnified Party, (iii) not comply with any of its other
obligations under Section 9.15 hereof in a timely manner or (iv) shall fail to
satisfy any obligation subsequent contained in Section 2.03 within the time
periods therein provided.
(b) Other than as is set forth in Section 7.01(a) hereof,
the Company shall fail to observe or perform any covenant or agreement
contained in this Agreement and such failure shall continue unremedied for 10
days after written notice thereof has been given to the Company by the Trustee
or the Agent of such failure.
(c) The Company or any of its Subsidiaries shall fail to
pay any principal of or premium or interest on any Debt that is outstanding in
a principal or notional amount of at least $25,000,000 in the aggregate (but
excluding Debt outstanding hereunder) of the Company or such Subsidiary (as the
case may be), when the same becomes due and payable (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise), and such
failure shall continue after the applicable grace period, if any, specified in
the agreement or instrument relating to such Debt; or any other event shall
occur or condition shall exist under any agreement or instrument relating to
any such Debt and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event or
condition is to accelerate, or to permit the acceleration of, the maturity of
such Debt; or any
54
such Debt shall be declared to be due and payable, or required to be prepaid or
redeemed (other than by a regularly scheduled required prepayment or
redemption), purchased or defeased, or an offer to prepay, redeem, purchase or
defease such Debt shall be required to be made, in each case prior to the
stated maturity thereof; or
(d) The Company or any of its Subsidiaries shall
generally not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general assignment
for the benefit of creditors; or any proceeding shall be instituted by or
against the Company or any of its Subsidiaries seeking to adjudicate it a
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee, custodian or other similar official for it or for any
substantial part of its property and, in the case of any such proceeding
instituted against it (but not instituted by it), either such proceeding shall
remain undismissed or unstayed for a period of 60 days, or any of the actions
sought in such proceeding (including, without limitation, the entry of an order
for relief against, or the appointment of a receiver, trustee, custodian or
other similar official for, it or for any substantial part of its property)
shall occur; or the Company or any of its Subsidiaries shall take any corporate
action to authorize any of the actions set forth above in this subsection (d);
PROVIDED, HOWEVER, that none of the foregoing acts or occurrences in this
subsection (d) with respect to a subsidiary of the Company shall constitute an
Event of Default unless the effect thereof shall be significant in relation to
the Company and its subsidiaries, taken as a whole; or
(e) Any unsatisfied judgment or order for the payment of
money in excess of $5,000,000 shall be rendered against the Company or any of
its Subsidiaries and there shall be any period of 10 consecutive days during
which a stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; or
55
(f) Any non-monetary judgment or order shall be rendered
against the Company or any of its Subsidiaries that could be reasonably
expected to have a Material Adverse Effect, and there shall be any period of 30
consecutive days during which a stay of enforcement of such judgment or order,
by reason of a pending appeal or otherwise, shall not be in effect; or
(g) Any ERISA Event shall have occurred and the sum
(determined as of the date of occurrence of such ERISA Event) of the liability
arising from such ERISA Event, together with the sum of the liabilities under
or attributable to any Employee Benefit Plans has, or is reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect; or (2) the
Company or any ERISA Affiliate fails to make full payment when due of all
amounts which, under the provisions of any Pension Plan or Section 412 of the
Code, the Company or any ERISA Affiliate is required to pay as contributions
thereto and such failure results or is likely to result in a Material Adverse
Effect; (3) an accumulated funding deficiency occurs or exists, whether or not
waived, with respect to any Pension Plan; (4) with respect to any Pension Plan
covered by Title IV of ERISA, the filing of a notice to voluntarily terminate
any such plan in a distress termination; (5) the Company or any ERISA Affiliate
withdraws from any Multiemployer Plan and receives a notice of liability in
such amount as would have a Material Adverse Effect; or (6) the Company or any
ERISA Affiliate terminates a Pension Plan which results in liability that would
have a Material Adverse Effect.
(h) Any certification or any representation or warranty
of the Company set forth herein or in any Operative Document or certificate,
notice, demand, request or other document delivered by or on behalf of the
Company to the Trustee, the Note and/or Certificate Purchasers or the Agent
hereunder or under any Operative Document shall prove to be inaccurate in any
material respect when the same shall have been made.
(i) An "Event of Default" (as defined in any such other
Operative Document but excluding an Unwind Event) under any such other
Operative Document shall have occurred.
(j) (i) Any Operative Document or any obligation of
the Company thereunder shall be revoked or
56
repudiated or attempted to be revoked or repudiated by the Company, or (ii) any
Operative Document or any material obligation of the Company thereunder shall
cease to be in full force and effect, by operation of law or by any other
means.
(k) (i) Any Person or group of Persons ((within the
meaning of Section 13 or 14 of the Securities Exchange Act of 1934, as
amended), other than the
Ferro Corporation Employee Stock Ownership Trust),
shall have acquired beneficial ownership (within the meaning of Rule 13d-3 of
the Securities and Exchange Commission under said Act) of shares representing
30% or more of the outstanding common shares of the Company, or (ii) during any
period of up to 24 consecutive calendar months, commencing after the date of
this Agreement, individuals who were directors of the Company on the first day
of such period, or who were elected to the board of directors of the Company
with the approval of a majority of such directors, shall together cease to
constitute a majority of the Board of Directors of the Company.
SECTION 7.02. REMEDIES UPON AN EVENT OF DEFAULT. (a) If an
Event of Default has occurred and is continuing, the Trustee may exercise any
of the rights or remedies granted to the Trustee under the Lease or any of the
other Operative Documents, in addition to any rights or remedies of such
parties set forth in this
Participation Agreement.
(b) If an Event of Default has occurred and is
continuing, then each of the Trustee, the Agent and the Purchasers may take all
steps necessary or advisable to protect and enforce its rights hereunder,
whether by action, suit or proceeding at law or in equity, for the specific
performance of any covenant, condition or agreement contained herein, or in aid
of the execution of any power herein granted, or for the enforcement of any
other appropriate legal or equitable remedy or otherwise as such party shall
deem necessary or advisable.
(c) No right or remedy hereunder shall be exclusive of
any other right, power or remedy, but shall be cumulative and in addition to
any other right or remedy hereunder or now or hereafter existing by law or in
equity, and the exercise by a party hereto of any one or more of such rights,
power or remedies shall not
57
preclude the simultaneous exercise of any or all of such other rights, powers
or remedies. Any failure to insist upon the strict performance of any provision
hereof or to exercise any option, right, power or remedy contained herein shall
not constitute a waiver or relinquishment thereof for the future. The Trustee
and the Holders from time to time of the Instruments shall be entitled to
injunctive relief in case of the violation or attempted or threatened violation
of any of the provisions hereof by any other party hereto, a decree compelling
performance of any of the provisions hereof or any other remedy allowed by Law
or in equity.
SECTION 7.03. Unwind Events. Any Event of Default (as
defined in the Agency Agreement) arising from the failure of the Construction
Agent to comply with the provisions of Sections 3(a), 3(b) or 3(c) of the
Agency Agreement shall not be deemed an Event of Default hereunder but shall
constitute an "Unwind Event".
SECTION 7.04. Remedies upon an Unwind Event. If an Unwind
Event shall have occurred, the Company either shall (i)(A) if requested by the
Trustee, arrange to sell the Property on behalf of the Trustee to one or more
third parties in arms length transactions, such sale to close on or before 90
days after the occurrence of such Unwind Event, and pay to the Trustee within
five (5) days of the occurrence of such sale an amount (the "Unwind Fee") equal
to the excess of (1) the Termination Value, over (2) the net proceeds realized
by the Trustee from the sale of the Property (and if such sale do not occur
within such 90-day period such sales shall nevertheless be deemed to have
occurred on such 90th day and such net proceeds shall be deemed to be $1.00),
such payment not to exceed 89.9% of Termination Value, and shall also pay all
Fixed Rent, Additional Rent and all costs and expenses incidental to the
unwinding of the transactions, including, without limitation, reasonable fees
of Special Counsel and Trustee's counsel and (B) satisfy each of the Return
Conditions other than the condition set forth in Section 7.05(b)(ii) or (ii)
deliver, or cause to be delivered, an Offer to Purchase the Property and
purchase or cause the Company's designee to purchase, the Property upon payment
of the Offer Purchase Price pursuant to paragraphs 14 and 15 of the Lease.
Upon satisfaction of the conditions set forth in (i) or (ii) above, this
Agreement shall terminate as set forth in Section 9.01.
58
SECTION 7.05. Residual Guaranty and Return Conditions. (a)
Upon the expiration of the Lease, if the Company does not purchase the Property
pursuant to the Lease, the Company shall pay to the Trustee on the Expiration
Date an advance residual guaranty payment equal to the Series A Portion of the
Original Capitalized Cost of the Property (the "Residual Guaranty").
(b) Upon the election of the Company to surrender the
Property to the Trustee pursuant to paragraph 27(a)(ii) of the Lease or Section
7.04(i) hereof, the Company shall provide, or cause to be provided or
accomplished, at the sole cost and expense of the Company, to or for the
benefit of the Trustee and the holders of the Instruments, at least thirty (30)
days but not more than sixty (60) days prior to the Expiration Date or date of
such other termination of the Lease each of the following (collectively, the
"Return Conditions"):
(i) an environmental audit of the Property, together with a
copy of the Environmental Consultant's report on its audit,
satisfactory, in form and substance, to the Agent, the Trustee and the
B-Note and Certificate Purchasers, each in their sole discretion to
the effect that (A) the Property is in compliance with all
Environmental Laws then enacted or then proposed, as determined by the
Environmental Consultant and special counsel selected by the Agent;
(B) no environmental condition exists on the Property on the date the
Property is surrendered that could pose any significant risk to human
health or the environment and (C) there is no pending or overtly
threatened litigation, investigation or other legal proceeding of any
kind that could result in any liability to any Purchaser, the Agent or
the Trustee or in the imposition of any Lien on the Property;
(ii) a report of the Appraiser and/or the Independent
Engineer, satisfactory in form and substance to the Trustee, the Agent
and the B-Note and Certificate Purchasers, to the effect that (A) the
Property has been maintained in accordance with the terms and
conditions of the Lease and that (based on inspection) the Property
(x) meets or exceeds the design specifications as of the Final
Completion Date (taking into account normal wear and tear) and (y) is
capable of operating as lubricant,
59
stearate and stabilizer manufacturing facilities at design capacity,
and at an efficiency and reliability typical of then-current market
standards for similar plants located in the United States and with the
useful life contemplated by and in accordance with the Construction
Plans and applicable Laws, and (z) is capable of meeting the terms of
any material existing contracts involving the Property; and (B) all
Assets and Improvements that have been stored in inventory have been
maintained at, or restored to, operating specifications;
(iii) evidence satisfactory to the Agent, the Trustee and the
Purchasers of the B-Notes and Certificates that the Company is, and
(as of the Expiration Date or date of such other termination of the
Lease) will be, in full compliance with the Services Agreement and has
made arrangements satisfactory to the Agent for the provision of
services required thereunder for the term thereof;
(iv) the Company shall have arranged for (A) a Texas
Standard Form T-1 form of extended coverage owner's title insurance
policy, or a commitment therefor, issued by the Title Company, marked
"premium paid" in an aggregate amount equal to the lesser of (i) the
maximum insurable amount or (ii) the Original Capitalized Cost of the
Property and in form and substance satisfactory to the Purchasers and
Special Counsel, to be delivered to the Purchasers and Special
Counsel, together with copies of all documents relating to title
exceptions referred to therein, showing record title of the Trustee in
the Texas Fee Parcels and the Texas Fee Improvements located thereon
and (B) an ALTA 1970 (amended 10-17-70 and 10-17-84) form of extended
coverage owner's title insurance policy, or a commitment therefor,
issued by the Title Company, marked "premium paid" in an aggregate
amount equal to the lesser of (i) the maximum insurable amount or (ii)
the Original Capitalized Cost of the Property and in form and
substance satisfactory to the Purchasers and Special Counsel, to be
delivered to the Purchasers and Special Counsel, together with copies
of all documents relating to title exceptions referred to therein,
showing record title of the
60
Trustee in the Ohio Fee Parcels and the Ohio Fee Improvements located
thereon;
(v) the Company may and, if directed to do so by the
Trustee, the Company shall remove, or cause the removal of, at the
Company's sole expense, any inventory, fixtures, machinery, equipment
or other property belonging to the Company or third parties in
compliance with paragraph 10(b) of the Lease; and
(vi) if directed to do so by the Trustee, the Company shall
cause all, or any portion of the Improvements not located on one of
the Fee Parcels or one of the Easement Parcels, to be installed in
operating order on such of the Fee Parcels or on such of the Easement
Parcels as the Trustee shall direct; and
(vii) if directed to do so by the Trustee, the Company shall
execute and deliver any and all further instruments, agreements and
documents as may, in the reasonable opinion of the Trustee, be
necessary to confirm the termination and expiration of the Lease and
to acknowledge that the Company, from the date of termination and
expiration, ceases to have any interest in the Property under the
Lease.
ARTICLE VIII.
THE AGENT
SECTION 8.01. Authorization and Action. Each Purchaser
hereby appoints and authorizes the Agent to take such action as the Agent on
such Purchaser's behalf and to exercise such powers under this Agreement and
the other Operative Documents as are delegated to the Agent by the terms hereof
and thereof, together with such powers as are reasonably incidental thereto.
The Trustee hereby appoints and authorizes the Agent to collect, disburse,
invest and otherwise administer on the Trustee's behalf all funds paid or
payable to the Trustee hereunder or under any of the Operative Documents, in
each case in accordance with the terms thereof and the Trustee, in its
individual capacity, shall not be liable for the actions or inactions of the
Agent in connection with the Agent's collection, disbursement, investment and
administration of such funds. As to any matters not
61
expressly provided for by this Agreement or the other Operative Documents, the
Agent shall not be required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be fully
protected in so acting or refraining from acting) upon the instructions of the
Majority Purchasers, and such instructions shall be binding upon all
Purchasers; provided, however, that the Agent shall not be required to take any
action which exposes the Agent to personal liability or which is contrary to
this Agreement or applicable Law. The Agent agrees to give to each Note and
Certificate Purchaser prompt notice of each notice given to it by the Company
and the Trustee pursuant to the terms of the Operative Documents.
SECTION 8.02. Agent's Reliance, Etc. NEITHER THE AGENT NOR
ANY OF ITS DIRECTORS, OFFICERS, AGENTS OR EMPLOYEES SHALL BE LIABLE FOR ANY
ACTION TAKEN OR OMITTED TO BE TAKEN BY IT OR THEM UNDER OR IN CONNECTION WITH
THIS AGREEMENT OR THE OTHER OPERATIVE DOCUMENTS, EXCEPT FOR ITS OR THEIR OWN
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, IT BEING THE INTENT THAT SUCH PERSONS
SHALL NOT BE LIABLE FOR ANY SUCH ACTION OR INACTION THAT CONSTITUTES ORDINARY
NEGLIGENCE. Without limiting the generality of the foregoing, the Agent: (i)
may consult with legal counsel, independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (ii) makes no warranty or representation to any Note or
Certificate Purchaser and shall not be responsible to any Note or Certificate
Purchaser for any statements, warranties or representations made in or in
connection with this Agreement or the other Operative Documents; (iii) shall
not have any duty to ascertain or to inquire as to the performance or
observance of any of the terms, covenants or conditions of this Agreement or
the other Operative Documents on the part of the Company or to inspect the
property (including the books and records) of the Company; (iv) shall not be
responsible to any Note or Certificate Purchaser for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement or the other Operative Documents or any other instrument or document
furnished pursuant hereto; and (v) shall incur no liability under or in respect
of this Agreement or the other Operative Documents by acting upon any notice,
consent, certificate
62
or other instrument or writing in accordance with the terms hereof believed by
it to be genuine and signed or sent by the proper party or parties.
SECTION 8.03. Citicorp and Affiliates. With respect to the
Fundings made by it and the Instruments issued to it, Citicorp, USA, Inc..
shall have the same rights and powers under any Instrument and this Agreement
as any other Purchaser and may exercise the same as though Citibank were not
the Agent; and the terms (x) "Purchaser" or "Purchasers" and (y) "Note
Purchaser" or "Note Purchasers" shall, unless otherwise expressly indicated,
include Citicorp, USA, Inc.. in its individual capacity, and Citicorp and its
Affiliates may accept deposits from, lend money to, act as trustee under
indentures of, and generally engage in any kind of business with, the Company
and any Subsidiary and any Person who may do business with or own securities of
the Company, or any Subsidiary, all as if Citibank were not the Agent and
without any duty to account therefor to the Purchasers.
SECTION 8.04. Purchaser Credit Decision. Each Purchaser
acknowledges that it has, independently and without reliance upon the Agent,
the Trustee or any other Purchaser and based on the financial statements
referred to in Section 4.01(d) and such other documents and information as it
has deemed appropriate, made its own credit analysis and decision to enter into
this Agreement. Each Purchaser also acknowledges that it will, independently
and without reliance upon the Agent, the Trustee or any other Note or
Certificate Purchaser or Holder from time to time of the Instruments and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions with respect to this Agreement or any
of the other Operative Documents.
SECTION 8.05. Indemnification. The Note and Certificate
Purchasers agree to indemnify the Agent, ratably according to the respective
aggregate principal and stated amounts of the Instruments then held by each of
them (or if the Instruments have been fully repaid and retired or if any
Instruments are held by Persons which are not Note or Certificate Purchasers,
ratably according to either (i) the respective aggregate amounts of their Note
and Certificate Commitments, or (ii) if all such Commitments have terminated,
the respective amounts of
63
the Note and Certificate Commitments immediately prior to the time the Note and
Certificate Commitments were terminated), from and against any and all Losses
which may be imposed on, incurred by, or asserted against the Agent in any way
relating to or arising out of this Agreement or any other Operative Document or
any action taken or omitted by the Agent under this Agreement or any other
Operative Document; provided, that no Note or Certificate Purchaser shall be
liable to the Agent for any portion of such Losses resulting from the Agent's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Note or Certificate Purchaser agrees to reimburse the Agent promptly upon
demand for its ratable share of any out-of-pocket expenses (including
reasonable counsel fees) incurred by the Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement
or any other Operative Document to the extent that the Agent is not reimbursed
for such expenses by the Company.
SECTION 8.06. Successor Agent. The Agent may resign at any
time as Agent under this Agreement by giving written notice thereof to the Note
and Certificate Purchasers, the Trustee and the Company and may be removed at
any time with or without cause by the Majority Purchasers. Upon any such
resignation or removal, the Majority Purchasers, subject to the consent of the
Company (which consent shall not be unreasonably withheld), shall have the
right to appoint a successor Agent which shall be a commercial bank or trust
company organized or licensed to conduct banking business under the Laws of the
United States or any state thereof. If no successor Agent shall have been so
appointed by the Majority Purchasers, and shall have accepted such appointment,
within 30 days after the retiring Agent's giving of notice of resignation or
the Majority Purchasers' removal of the retiring Agent, then the retiring Agent
may, on behalf of the Note and Certificate Purchasers, appoint a successor
Agent, which shall be a Note or Certificate Purchaser which is a commercial
bank organized under the laws of the United States of America or of any state
thereof and having a combined capital and surplus of at least $500 million.
Upon the acceptance of any appointment as Agent under this Agreement by a
successor Agent, such successor Agent shall thereupon
64
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Agent and shall function as the Agent under this Agreement, and
the retiring Agent shall be discharged from its duties and obligations as Agent
under this Agreement. After any retiring Agent's resignation or removal
hereunder as Agent, the provisions of this Article VIII shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement, irrespective of any amendments hereto subsequent to such
resignation or removal.
ARTICLE IX.
MISCELLANEOUS
SECTION 9.01. Survival. Except as otherwise expressly
provided, the parties' obligations under this Agreement and in any certificate
or other instrument delivered by any party or on such party's behalf pursuant
to this Agreement shall terminate upon the payment in full of all amounts then
and thereafter due on the Notes and the Certificates and under any of the
Operative Documents. The confidentiality provisions contained in this
Agreement and the provisions of Sections 6.03, 6.06, 9.14, 9.15, 9.17 and 9.20
hereof shall each survive the payment in full of all amounts then and
thereafter due on the Instruments and due under any of the Operative Documents.
Such rights and obligations shall survive the execution and delivery of any
Operative Document, any issuance or disposition of any of the Instruments, any
disposition of any interest in the Property or the termination of any Operative
Document and shall continue in effect regardless of any investigation made by
or on behalf of any party hereto and notwithstanding that any party may waive
compliance with any other provision of any Operative Document.
SECTION 9.02. Notices. Unless otherwise specifically
provided in any Operative Document, all notices, consents, directions,
approvals, instructions, requests and other communications given to any party
hereto under any Operative Document shall be in writing to such party at the
address set forth in Schedule I hereto or at such other address as such party
shall designate by notice to each of the other parties hereto and may be
personally delivered (including delivery by private courier services) or by
telecopy (with a copy of
65
such notice sent by private courier service for overnight delivery or by
registered or certified mail), to the party entitled thereto, and shall be
deemed to be duly given or made when delivered by hand unless such day is not a
Business Day, in which case such delivery shall be deemed to be made as of the
next succeeding Business Day or in the case of telecopy (with a copy of such
notice sent by private courier service for overnight delivery or by registered
or certified mail), when sent, so long as it was received during normal
business hours of the receiving party on a Business Day and otherwise such
delivery shall be deemed to be made as of the next succeeding Business Day.
SECTION 9.03. Severability. If any provision hereof or the
application thereof to any Person or circumstance shall be invalid, illegal or
unenforceable, the remaining provisions or the application of such provision to
Persons or circumstances other than those as to which it is invalid or
enforceable, shall continue to be valid and enforceable.
SECTION 9.04. Amendments, Etc. No amendment or waiver of any
provision of this Agreement, nor consent to any departure by the Company
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Majority Purchasers (unless the Agent is authorized hereunder
or under any Operative Document to act without joinder of the Majority
Purchasers, in which case the Agent may take such action), the Company and the
Trustee, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that, in addition to the requirements above, no amendment, waiver or
consent shall, unless in writing and signed by all of the Note and Certificate
Purchasers, do any of the following: (a) increase the Commitments of the
Purchasers or subject the Note or Certificate Purchasers to any additional
obligations, (b) reduce the Applicable Rate or any fees or other amounts
payable hereunder or under any other Operative Document, (c) take action which
requires the signing of all the Note and Certificate Purchasers pursuant to the
terms of this Agreement, (d) postpone any date fixed for any payment of
principal or stated amount of, or interest or Distributions on the Instruments
or any fees or other amounts payable under the Declaration or (e) amend this
Section 9.04; provided, further, that, in addition to the
66
requirements above, no amendment, waiver or consent shall, unless in writing
and signed by the Agent in addition to the Purchasers required above to take
such action, affect the rights or duties of the Agent under this Agreement or
any of the Operative Documents. Notwithstanding the foregoing, a waiver of any
or all of the conditions set forth in Section 3.02 hereof shall be effective if
in writing and signed by the Agent, the Majority Purchasers and the Trustee.
SECTION 9.05. Headings. The table of contents and headings
of the Articles, Sections and subsections of this Agreement are for convenience
only and shall not affect the meaning of this Agreement.
SECTION 9.06. Compliance Responsibility. None of the Trustee
(notwithstanding the representations and warranties of SSBTC in Section 4.02
hereof), the Agent or any Purchaser shall have any responsibility for
compliance by the Property or by the Company with any Law, architectural or
engineering standards or practices or other matters. The Company expressly
assumes such responsibilities and shall indemnify and hold harmless the
Trustee, the Agent and the Note and Certificate Purchasers with respect thereto
in the manner provided in the Lease.
SECTION 9.07. Definitions. Except as otherwise expressly
provided herein, capitalized terms used in this Agreement and all schedules and
exhibits hereto shall have the respective meanings given in Appendix A hereto.
SECTION 9.08. Benefit. The parties hereto and their
permitted successors and assigns, but no others, shall be bound hereby and
entitled to the benefit hereof.
SECTION 9.09. Place of Payment. So long as a Purchaser or an
Affiliate of a Purchaser or a bank or institutional investor is the owner of
any beneficial interest in the Instruments, the Trustee will cause all amounts
to be paid by the Trustee which become due and payable or owing on such
beneficial interest in the Instruments to be paid by bank wire transfer of
immediately available funds or, at the option of such Purchaser, such
Affiliate, bank or institutional investor, by check of the Trustee, duly
mailed, delivered or made at the address or account referenced in
67
Schedule I hereto or provided in writing by such Person to the Trustee, in all
cases without presentation of the underlying Instrument, provided, that upon
receipt of payment in full the underlying Instruments shall be returned by the
respective Holders thereof to the Trustee marked "cancelled."
SECTION 9.10. Counterparts. The parties may sign this
Agreement in any number of counterparts and on separate counterparts, each of
which shall be an original but all of which together shall constitute one and
the same instrument.
SECTION 9.11. Governing Law and Jurisdiction. (a) THIS
AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF
NEW YORK, INCLUDING SECTION 5-1401 OF THE
NEW YORK GENERAL
OBLIGATIONS LAW (OR ANY SIMILAR SUCCESSOR PROVISION THERETO) BUT EXCLUDING ALL
OTHER CONFLICT-OF-LAWS RULES.
(b) Each of the parties hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any
New York State court or federal court of the United States
of America sitting in
New York City, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this Agreement or any
other Operative Document, or for recognition or enforcement of any judgment,
and each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in any such
New York State court or, to the extent permitted by law,
in such federal court. Each of the parties hereto agrees that a final judgment
in any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law. Nothing in this Agreement shall affect any right that any party may
otherwise have to bring any action or proceeding relating to this Agreement or
the Notes in the courts of any jurisdiction.
(c) Each of the parties hereto irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection that it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement or
any other Operative Document in any
New York
68
State or federal court. Each of the parties hereto hereby irrevocably waives,
to the fullest extent permitted by law, the defense of an inconvenient forum to
the maintenance of such action or proceeding in any such court.
SECTION 9.12. Time; Business Day. (a) TIME IS OF THE
ESSENCE IN THIS AGREEMENT, AND THE TERMS HEREIN SHALL BE SO CONSTRUED.
(b) If the date scheduled for any payment or action under
any Operative Document shall not be a Business Day, then (unless such Operative
Document provides otherwise) such payment shall be made or such action shall be
taken on the next succeeding Business Day.
SECTION 9.13. The Trustee. Except for SSBTC's liability for
SSBTC's representations and warranties in Section 4.02, and for its own gross
negligence and willful misconduct and as otherwise provided in the Operative
Documents, it is expressly understood and agreed by the parties hereto that (a)
this Agreement is executed and delivered by SSBTC, not in its individual
capacity but solely as Trustee, under the Declaration, in the exercise of the
powers and authority conferred and vested in it as the Trustee, (b) each of the
undertakings and agreements herein made on the part of the Trustee is made and
intended not as a personal representation, undertaking and agreement by SSBTC
but is made and intended for the purpose for binding only the Trust Estate
created by the Declaration, (c) nothing herein contained shall be construed as
creating any liability on SSBTC, individually or personally, to perform any
obligation of the Trustee either expressed or implied contained herein or in
the Operative Documents, all such liability, if any, being expressly waived by
the parties to this Agreement and by any Person claiming by, through or under
the parties to this Agreement and (d) under no circumstances shall SSBTC be
personally liable for the payment of any indebtedness or expenses of the
Trustee or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Trustee under
this Agreement or the other Operative Documents.
69
SECTION 9.14. Transaction Costs; Facility Fees; Upfront
Fees.
(a) Transaction Costs. Whether or not the transactions
contemplated by this Agreement are consummated, the Company shall pay and hold
the Trustee, the Agent and the Note and Certificate Purchasers harmless against
any liability for the payment of all reasonable fees, expenses, disbursements
and out-of-pocket costs incurred before, on or after the date hereof in
connection with the preparation, execution and delivery of any Operative
Document, or any other agreement, arrangement, document or paper relating to
the transactions contemplated hereby or any amendment or supplement thereto or
any waivers or enforcement thereof, including, but not limited to:
(i) the reasonable fees, expenses and disbursements
of each of the Agent, the Trustee, Trustee's Counsel, Certificate
Purchaser's Counsel, Special Counsel and Special Environmental Counsel
for services rendered to such parties in connection with such
transactions;
(ii) the out-of-pocket expenses of each of the Trustee
and the Agent incurred in connection with such transactions;
(iii) all fees and expenses in connection with any
appraisal, environmental report, engineering study, survey or
inspection of the Property, or any printing and other document
reproduction and distribution expenses, stamp or other similar Taxes,
fees or excises, including interest and penalties, and all filing fees
and Taxes in connection with the recording or filing of instruments
and financing statements in connection with the transactions described
in this Agreement;
(iv) the out-of-pocket expenses of the Trustee and the
Agent in connection with the placement of the Instruments as
contemplated hereby; and
(v) the fees, expenses and disbursements of the
Agent, the Trustee and the Purchasers, including the fees, expenses
and disbursements of their respective counsel, in connection with the
70
enforcement of any rights of the Purchasers under any of the Operative
Documents.
(b) Facility Fees. From and after the Financing Closing
Date, to and including the Interim Note Maturity Date, the Company shall pay to
the Agent for the account of each Purchaser, on the last day of each March,
June, September and December in each year and on the Interim Note Maturity
Date, a facility fee at the applicable rate per annum set forth on the pricing
grid attached hereto as Schedule II on the unused portion of its respective
Note Commitment or Certificate Commitment, as the case may be ("Facility Fee").
The Facility Fee shall be computed on the basis of the actual number of days
elapsed over a year of 360 days.
(c) Upfront Fees. On the Financing Closing Date, the
Company shall pay to the Agent for the account of each Note Purchaser an
upfront fee at the rate of 0.15% on its respective Note Commitment as of the
Financing Closing Date ("Upfront Fee").
SECTION 9.15. INDEMNIFICATION. (A) THE COMPANY SHALL PAY,
PROTECT, INDEMNIFY AND HOLD HARMLESS EACH INDEMNIFIED PARTY FROM AND AGAINST,
AND SHALL DEFEND ALL ACTIONS AGAINST ANY INDEMNIFIED PARTY WITH RESPECT TO, ANY
AND ALL LIABILITIES (INCLUDING BUT NOT LIMITED TO LIABILITY FOR PATENT OR
TRADEMARK INFRINGEMENT OR MISUSE OR MISAPPROPRIATION OF ANY INTELLECTUAL
PROPERTY RIGHTS, LIABILITY IN TORT (STRICT OR OTHERWISE)), LOSSES, DAMAGES,
COSTS, EXPENSES (INCLUDING BUT NOT LIMITED TO REASONABLE ATTORNEY'S FEES AND
EXPENSES OF COUNSEL), CAUSES OF ACTION, SUITS, CLAIMS, DEMANDS OR JUDGMENTS OF
ANY NATURE WHATSOEVER (COLLECTIVELY, "LOSSES") ARISING FROM (I) ANY INJURY TO,
OR DEATH OF, ANY NATURAL PERSON, OR DAMAGE TO OR LOSS OF PROPERTY, OR ANY
MATTERS OCCURRING ON OR RESULTING FROM ACTIVITIES ON THE PROPERTY OR ANY PART
THEREOF; (II) THE OWNERSHIP, CONSTRUCTION, LEASING (INCLUDING, WITHOUT
LIMITATION, THE FAILURE OF THE TRUSTEE TO HAVE A MORTGAGE ON THE PROPERTY, THE
IMPROVEMENTS OR THE PROPERTY UNDER THE CIRCUMSTANCES SET FORTH IN PARAGRAPH
20(D) OF THE LEASE), SUBLEASING, OPERATION, OCCUPANCY, POSSESSION, USE, NON-USE
OR CONDITION OF THE PROPERTY OR ANY PART THEREOF; (III) ANY VIOLATION BY THE
COMPANY OF ANY OF THE TERMS OR CONDITIONS OF THIS AGREEMENT, THE LEASE OR ANY
OF THE OTHER OPERATIVE DOCUMENTS; (IV) ANY EXERCISE OF RIGHTS OR REMEDIES UPON
THE OCCURRENCE OF ANY DEFAULT OR EVENT OF
71
DEFAULT; (V) ANY ACT OR OMISSION OF THE COMPANY OR ANY OF ITS AGENTS,
CONTRACTORS, LICENSEES, SUBLESSEES, INVITEES, REPRESENTATIVES OR ANY PERSON FOR
WHOSE CONDUCT THE COMPANY IS LEGALLY RESPONSIBLE ON OR RELATING TO OR IN
CONNECTION WITH THE OWNERSHIP, CONSTRUCTION, LEASING, SUBLEASING, OPERATION,
MANAGEMENT, MAINTENANCE, OCCUPANCY, POSSESSION, USE, NON-USE OR CONDITION OF
THE PARCEL, THE IMPROVEMENTS OR THE PROPERTY OR ANY PART THEREOF; (VI) ANY
LIENS (INCLUDING, WITHOUT LIMITATION, ANY PERMITTED ENCUMBRANCES) ON OR WITH
RESPECT OF AND TO THE PARCEL OR THE PROPERTY OR ANY PART THEREOF; (VII) ANY
PERMITTED CONTEST REFERRED TO IN PARAGRAPH 11 OR 18 OF THE LEASE; (VIII) ANY
VIOLATION BY THE COMPANY OF ANY FACILITY AGREEMENT OR ANY CONTRACT OR AGREEMENT
RELATING TO THE PROPERTY OR THE TRANSACTIONS TO BE CONSUMMATED PURSUANT TO THE
OPERATIVE DOCUMENTS TO WHICH THE COMPANY IS A PARTY OR OF ANY LEGAL REQUIREMENT
OR INSURANCE REQUIREMENT; (IX) ANY TERMINATION OR INVALIDITY OF THE ▇▇▇▇ OF
SALE OR THE DEEDS OR THE TRUSTEE'S INTEREST IN THE PROPERTY OR THE IMPROVEMENTS
(OTHER THAN AS A RESULT OF THE PURCHASE OF THE PROPERTY BY THE COMPANY) IN EACH
CASE AFFECTING ANY INDEMNIFIED PARTY, THE PARCEL OR THE PROPERTY OR ANY PART
THEREOF OR THE OWNERSHIP, OPERATION, OCCUPANCY, POSSESSION, USE, NON-USE OR
CONDITION THEREOF AND IN EACH CASE REGARDLESS OF THE ACTS, OMISSIONS OR
NEGLIGENCE OF ANY INDEMNIFIED PARTY (IT BEING THE INTENT TO INDEMNIFY EACH
INDEMNIFIED PARTY FROM SUCH INDEMNIFIED PARTY'S OWN NEGLIGENCE EXCEPT AS
OTHERWISE SET FORTH IN THE FOLLOWING PROVISO); PROVIDED, HOWEVER, THAT THE
COMPANY SHALL NOT BE REQUIRED TO INDEMNIFY OR HOLD HARMLESS ANY INDEMNIFIED
PARTY HEREUNDER AGAINST ANY SUCH LOSSES TO THE EXTENT RESULTING FROM FRAUD,
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED PARTY. FOR PURPOSES
OF THIS SECTION 9.15, "INDEMNIFIED PARTY" MEANS EACH OF THE TRUSTEE (IN BOTH
ITS INDIVIDUAL AND FIDUCIARY CAPACITIES), THE AGENT AND THE HOLDERS FROM TIME
TO TIME OF THE INSTRUMENTS, THEIR AFFILIATES, SUCCESSORS AND ASSIGNS AND ANY
OFFICER, DIRECTOR, EMPLOYEE OR AGENT OF ANY OF THE ABOVE.
(b) THE OBLIGATIONS OF THE COMPANY UNDER THIS SECTION
9.15 SHALL SURVIVE THE EXPIRATION OR ANY TERMINATION OF THE LEASE (WHETHER BY
OPERATION OF LAW OR OTHERWISE) FOR ALL MATTERS DESCRIBED IN THIS SECTION 9.15
WHICH OCCUR OR ARISE PRIOR TO SUCH EXPIRATION OR TERMINATION OR ARISE OUT OF OR
RESULT FROM FACTS, EVENTS, CLAIMS, LIABILITIES, ACTIONS OR CONDITIONS
OCCURRING, ARISING OR EXISTING ON OR BEFORE SUCH EXPIRATION OR
72
TERMINATION. IN CASE ANY ACTION SHALL BE BROUGHT AGAINST ANY INDEMNIFIED PARTY
IN RESPECT OF WHICH INDEMNITY MAY BE SOUGHT AGAINST THE COMPANY, SUCH
INDEMNIFIED PARTY SHALL PROMPTLY NOTIFY THE COMPANY IN WRITING, BUT FAILURE TO
GIVE SUCH PROMPT NOTICE SHALL NOT RELIEVE THE COMPANY FROM ANY LIABILITY
HEREUNDER, UNLESS THE COMPANY IS PREJUDICED BY THE FAILURE TO RECEIVE SUCH
NOTICE. IF NO DEFAULT OR EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING
HEREUNDER, THE COMPANY, AT ITS OWN EXPENSE, MAY ELECT TO ASSUME THE DEFENSE OF
ANY ACTION BROUGHT AGAINST AN INDEMNIFIED PARTY, INCLUDING THE EMPLOYMENT OF
COUNSEL REASONABLY SATISFACTORY TO SUCH INDEMNIFIED PARTY AND THE PAYMENT BY
THE COMPANY OF ALL EXPENSES THEREOF. ANY INDEMNIFIED PARTY SHALL HAVE THE
RIGHT TO EMPLOY SEPARATE COUNSEL AT ITS EXPENSE IN ANY SUCH ACTION AND TO
CONSULT WITH THE COMPANY REGARDING THE DEFENSE THEREOF; PROVIDED, HOWEVER,
THAT, EXCEPT AS OTHERWISE PROVIDED BELOW, THE COMPANY SHALL AT ALL TIMES
CONTROL SUCH DEFENSE. IF THE COMPANY SHALL HAVE FAILED TO EMPLOY COUNSEL
REASONABLY SATISFACTORY TO THE INDEMNIFIED PARTIES, THE FEES AND EXPENSES OF
THE COUNSEL TO THE INDEMNIFIED PARTIES AS A GROUP SHALL BE PAID BY THE COMPANY.
IF THE COMPANY SHALL ELECT IN WRITING NOT TO ASSUME THE DEFENSE OR SHALL FAIL
TO PROSECUTE DILIGENTLY SUCH DEFENSE THEREOF, AN INDEMNIFIED PARTY MAY, AFTER
WRITTEN NOTICE TO THE COMPANY AND THE COMPANY'S FAILURE TO REMEDY PROMPTLY THE
SAME, ASSUME THE DEFENSE THEREOF, INCLUDING THE EMPLOYMENT OF COUNSEL, IN WHICH
CASE THE COMPANY SHALL PAY ALL OF THE LOSSES OF SUCH INDEMNIFIED PARTY INCURRED
IN RESPECT OF SUCH DEFENSE. IF ANY INDEMNIFIED PARTY SHALL HAVE BEEN ADVISED
BY COUNSEL CHOSEN BY IT THAT THERE MAY BE ONE OR MORE LEGAL DEFENSES AVAILABLE
TO SUCH INDEMNIFIED PARTY THAT ARE DIFFERENT FROM OR ADDITIONAL TO THOSE
AVAILABLE TO THE COMPANY OR THE OTHER INDEMNIFIED PARTIES OR IT WOULD BE
INAPPROPRIATE FOR SUCH COUNSEL TO CONTINUE TO REPRESENT IN RESPECT OF A
PARTICULAR LEGAL OR FACTUAL ISSUE OR OTHERWISE, EACH OF THE INDEMNIFIED PARTY
AND THE COMPANY MAY RETAIN ADDITIONAL AND SEPARATE COUNSEL TO REPRESENT IT OR,
AT ITS OPTION, ASSUME THE DEFENSE OF SUCH ACTION AND THE COMPANY WILL REIMBURSE
SUCH INDEMNIFIED PARTY FOR THE REASONABLE FEES AND EXPENSES OF ANY COUNSEL
RETAINED BY THE INDEMNIFIED PARTY. THE COMPANY SHALL NOT BE LIABLE FOR ANY
SETTLEMENT OF ANY ACTION WITHOUT ITS WRITTEN CONSENT. NO SETTLEMENT OF ANY
SUCH ACTION MAY BE MADE BY THE COMPANY WITHOUT THE INDEMNIFIED PARTY'S WRITTEN
CONSENT; PROVIDED, HOWEVER, SUCH CONSENT SHALL NOT BE NECESSARY IF THE
SETTLEMENT RESULTS IN AN
73
UNCONDITIONAL RELEASE OF THE INDEMNIFIED PARTY WITHOUT (1) THE ADMISSION BY THE
INDEMNIFIED PARTY OF GUILT, COMPLICITY OR CULPABILITY OR (2) THE INCURRENCE OF
ANY PAYMENT OBLIGATION ON THE PART OF SUCH INDEMNIFIED PARTY WHICH IS NOT PAID
AT THE TIME OF SUCH SETTLEMENT BY THE COMPANY HEREUNDER.
(c) UPON DEMAND FOR PAYMENT BY ANY INDEMNIFIED PARTY OF
ANY LOSSES INCURRED BY IT FOR WHICH INDEMNIFICATION IS SOUGHT, ALONG WITH A
BRIEF DESCRIPTION IN REASONABLE DETAIL OF THE NATURE AND EXTENT OF THE LOSSES
AS WELL AS THE CIRCUMSTANCES UNDER WHICH INDEMNIFICATION IS SOUGHT, THE COMPANY
SHALL PAY WHEN DUE AND PAYABLE THE FULL AMOUNT OF SUCH LOSSES TO THE
APPROPRIATE PARTY, UNLESS AND SO LONG AS (I) THE COMPANY SHALL HAVE ASSUMED THE
DEFENSE OF SUCH ACTION OR IS CONTESTING SUCH LIABILITY, LOSS, DAMAGE, COST,
EXPENSE, CAUSE OF ACTION, SUIT, CLAIM, DEMAND OR JUDGMENT FOR WHICH INDEMNITY
IS SOUGHT HEREUNDER AND (II) IS DILIGENTLY PROSECUTING THE SAME AND THE COMPANY
HAS TAKEN ALL ACTION AS MAY BE NECESSARY TO PREVENT (A) THE COLLECTION OF SUCH
LOSSES FROM THE INDEMNIFIED PARTY; (B) THE SALE, FORFEITURE OR LOSS OF THE
PROPERTY OR ANY PART THEREOF DURING SUCH DEFENSE OF THE SAME ACTION; AND (C)
THE IMPOSITION OF ANY CIVIL OR CRIMINAL LIABILITY FOR FAILURE TO PAY SUCH
LOSSES WHEN DUE AND PAYABLE.
(d) THE COMPANY ACKNOWLEDGES AND AGREES THAT (I) ITS
OBLIGATIONS UNDER THIS SECTION 9.15 ARE INTENDED TO INCLUDE AND EXTEND TO ANY
AND ALL LIABILITIES, SUMS PAID IN SETTLEMENT OF CLAIMS, OBLIGATIONS, CHARGES,
ACTIONS, CLAIMS, LIENS, TAXES AND DAMAGES (INCLUDING, WITHOUT LIMITATION,
PUNITIVE DAMAGES, PENALTIES, FINES, COURT COSTS, ADMINISTRATIVE SERVICE FEES,
RESPONSE AND REMEDIATION COSTS, STABILIZATION COSTS, ENCAPSULATION COSTS,
TREATMENT, STORAGE OR DISPOSAL COSTS AND LEGAL FEES INCURRED IN NEGOTIATING
WITH GOVERNMENTAL AGENCIES AND OTHER POTENTIALLY RESPONSIBLE PARTIES AND IN
ENFORCING INDEMNITIES) IMPOSED UPON OR INCURRED BY OR ASSERTED AT ANY TIME
AGAINST ANY INDEMNIFIED PARTY (WHETHER OR NOT INDEMNIFIED AGAINST BY ANY OTHER
PARTY) ARISING DIRECTLY OR INDIRECTLY OUT OF: (A) THE TREATMENT, STORAGE,
DISPOSAL, GENERATION, USE, TRANSPORT, MOVEMENT, PRESENCE, RELEASE, THREATENED
RELEASE, SPILL, INSTALLATION, SALE, EMISSION, INJECTION, LEACHING, DUMPING,
ESCAPING OR SEEPING OF ANY HAZARDOUS MATERIALS OR MATERIAL CONTAINING OR
ALLEGED TO CONTAIN HAZARDOUS MATERIALS AT, ON, UNDER, ONTO, THROUGH OR FROM THE
PARCEL
74
OR THE PROPERTY OR ANY PART THEREOF; (B) THE VIOLATION OR ALLEGED VIOLATION OF
ANY ENVIRONMENTAL LAWS RELATING TO OR IN CONNECTION WITH THE PARCEL OR THE
PROPERTY OR ANY PART THEREOF OR ANY ACTS OR OMISSIONS THEREON OR RELATING
THERETO; (C) ALL OTHER FEDERAL, STATE AND LOCAL LAWS DESIGNED TO PROTECT THE
ENVIRONMENT OR PERSONS OR PROPERTY THEREIN, WHETHER NOW EXISTING OR HEREINAFTER
ENACTED, PROMULGATED OR ISSUED BY ANY FEDERAL, STATE, COUNTY, MUNICIPAL OR
OTHER GOVERNMENTAL AUTHORITY; AND (D) THE COMPANY'S FAILURE TO COMPLY WITH ITS
OBLIGATIONS UNDER PARAGRAPH 2(E) OF THE LEASE AND (II) THE INDEMNIFICATION
PROVIDED FOR UNDER THIS SECTION 9.15(D) SHALL BE GOVERNED BY THE PROCEDURES SET
FORTH IN SECTIONS 9.15(B)-(C) HEREOF.
SECTION 9.16. Operative Documents; Further Assurances. Each
of the parties hereto does hereby covenant and agree to perform and be governed
and restricted by the Operative Documents to which it is a party and, subject
to the terms and conditions thereof, to take or cause to be taken, all actions
and to do, or cause to be done, all things necessary, proper or advisable in
connection therewith. Each of the parties hereto shall have the rights and
obligations set forth in the Declaration with respect to such party
notwithstanding that not all of such parties are signatories thereto. The
Company, the Trustee, the Agent and the Note and Certificate Purchasers will,
at the expense of the Company, execute and deliver such further instruments and
do such further acts as may be necessary or proper to carry out more
effectively the purposes of the Operative Documents and the transactions
contemplated thereby. The Company, the Trustee, the Agent and the Note and
Certificate Purchasers may at any time, subject to the conditions and
restrictions contained in the Operative Documents, enter into supplements which
shall form a part hereof, when required or permitted by any of the provisions
of the Operative Documents or to cure any ambiguity, or to cure, correct or
supplement any defective or inconsistent provision contained herein or in any
other Operative Document.
SECTION 9.17. Confidentiality. (a) Each of the parties
hereto, other than Citibank and, as applicable, its Affiliates, agrees that,
subject to Section 6.02, it will maintain the confidentiality of the general
structure of this transaction.
75
(b) Each of the parties hereto agrees that unless
otherwise required by Law or by any governmental authority or body or consented
to by the Company and Citibank, it will maintain the confidentiality of all
non-public information (i) regarding the financial terms of this transaction or
(ii) regarding the Company or the Property which shall be furnished to it by or
on behalf of the Company in connection with the transactions contemplated by
the Operative Documents, including, without limitation, the as-built plans and
specifications delivered pursuant to Section 5.01(b), in accordance with the
procedures it generally applies to confidential material for a period of three
years after all of the Instruments have been repaid in full, but in no event
less than seven years from the date hereof; provided, however, that if the
Lease has been terminated and the Company has not purchased the Property, then
none of the Purchasers, the Agent nor the Trustee shall be bound by the
confidentiality provisions of this Section 9.17(b).
(c) The parties hereto agree not to publish tombstones or
other public announcements in connection with the transactions contemplated
hereby without the consent of the Company, the Agent and the Purchasers.
SECTION 9.18. Interest. It is the intention of the parties
hereto to conform strictly to all usury Laws that are applicable to each such
party, Purchaser, Note or Certificate or to the transactions contemplated by
the Operative Documents (collectively, the "Transactions"). Accordingly,
notwithstanding anything to the contrary in the Instruments, this Agreement or
any other Operative Document or agreement entered into in connection with the
Transactions (collectively, the "Transaction Documents"), it is agreed as
follows: (i) the aggregate of all consideration which constitutes interest
under Applicable Law (hereinafter defined) that is contracted for, taken,
reserved, charged or received by any party under the Transaction Documents or
otherwise in connection with the Transactions shall under no circumstances
exceed the maximum amount of interest that could lawfully be charged by such
party under Applicable Law, (ii) in the event that the maturity of any
indebtedness evidenced by or payable pursuant to the Transaction Documents is
accelerated for any reason, or in the event of any required or permitted
payment or prepayment of all or any part of such indebtedness (including,
without limitation and if applicable, any
76
required or permitted purchase of the Property, or any required or permitted
payment of the Offer Purchase Price, the Residual Guaranty or Termination
Value), then such consideration that constitutes interest as to any such
indebtedness under Applicable Law may never include more than the maximum
amount allowed by such Applicable Law, and (iii) if under any circumstances the
aggregate amounts paid on any Instruments prior to or incident to the final
payment thereof include any amounts which by Applicable Law would be deemed
interest in excess of the maximum amount of interest permitted by Applicable
Law, such excess amounts, if theretofore paid, shall be credited by the
recipient on the principal or stated amount of the affected indebtedness (or,
to the extent that the principal or stated amount of such indebtedness shall
have been or would thereby be paid in full, refunded by such recipient to the
party entitled thereto). If at any time the rate of interest (denominated as
such) or Distributions, as applicable, contractually called for in any
Transaction Document (as the same may vary from time to time pursuant to the
terms of such Transaction Document, the "Stated Rate"), exceeds the maximum
non-usurious rate of interest permitted by Applicable Law (the "Maximum Rate")
in respect of the indebtedness evidenced by such Transaction Document, taking
into account all other amounts paid or payable pursuant to the Transaction
Documents which constitute interest with respect to such indebtedness under
Applicable Law regardless of whether denominated as interest or Distributions
(collectively, the "Other Charges"), then the rate of interest to accrue or
Distributions owing on such indebtedness shall be limited to such Maximum Rate
(taking into account the Other Charges), but any subsequent reduction in the
Stated Rate applicable to such indebtedness shall not reduce the rate of
interest or Distributions to accrue on such indebtedness below such Maximum
Rate (taking into account the Other Charges) until such time as the total
amount of interest or Distributions on such indebtedness equals the amount of
interest or Distributions which would have accrued if the Stated Rate
applicable to such indebtedness had at all times been in effect. If at the
maturity or final payment of any indebtedness the total amount of interest or
Distributions paid or accrued on such indebtedness under the preceding sentence
is less than the total amount of interest or Distributions which would have
accrued if the Stated Rate applicable to such indebtedness had at all times
been in effect, then to the
77
fullest extent permitted by Applicable Law there shall be due and payable or
owing with respect to such indebtedness an amount equal to the excess, if any,
of (a) the lesser of (i) the amount of interest or Distributions (as
applicable) which would have accrued on such indebtedness if such Maximum Rate
in respect of such indebtedness had at all times been in effect and been chosen
as the rate of interest or Distributions to be applicable throughout the term
of such indebtedness (taking into account the Other Charges) and (ii) the
amount of interest or Distributions (as applicable) which would have accrued on
such indebtedness if the Stated Rate applicable to such indebtedness had at all
times been in effect, above (b) the amount of interest or Distributions (as
applicable) accrued in accordance with the provisions of the Transaction
Document evidencing such indebtedness after giving effect to the preceding
sentence. All amounts paid or agreed to be paid for the use, forbearance or
detention of sums pursuant to or in connection with the Transaction Documents
shall, to the extent permitted by Applicable Law, be amortized, prorated,
allocated and spread throughout the full term thereof so that the rate or
amount of interest paid or payable with respect to any amount of indebtedness
evidenced by or payable pursuant to the Transaction Documents does not exceed
the applicable usury ceiling, if any. As used herein, the term "Applicable
Law" means that law, if any, that is applicable to any particular Transaction
and that limits the maximum non-usurious rate of interest that may be taken,
contracted for, charged, reserved or received with respect to such Transaction,
including the law of the State of
New York, the law of the State of Texas, the
law of any other jurisdiction that may be mandatorily applicable to such
Transaction notwithstanding other provisions of this Agreement and the other
Transaction Documents, and the Federal law of the United States of America. As
used herein, the term "interest" means interest as determined under Applicable
Law, regardless of whether denominated as interest in the Transaction Documents
(except to the extent that this Section 9.18 specifically refers to interest
denominated as interest). The right to accelerate maturity of any indebtedness
evidenced by any Instrument or other Transaction Document, and the right to
demand payment of the Offer Purchase Price, the Residual Guaranty or
Termination Value does not include the right to accelerate any interest, or to
receive any other amounts, which would cause the Transactions to be usurious
under
78
Applicable Law. All computations of the maximum amount allowed under
Applicable Law, as well as all computations of interest at the Maximum Rate,
will be made on the basis of the actual number of days elapsed over a 365 or
366 day year, whichever is applicable pursuant to such Applicable Law. The
provisions of this Section 9.18 shall prevail over any contrary provisions in
this Agreement, the Instruments or any of the other Transaction Documents.
SECTION 9.19. WAIVER OF TRIAL BY JURY. IN ANY ACTION OR
PROCEEDING UNDER OR RELATED TO THIS AGREEMENT, THE OPERATIVE DOCUMENTS OR ANY
AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE
FUTURE BE DELIVERED IN CONNECTION WITH THE FOREGOING, THE COMPANY, THE AGENT,
THE TRUSTEE AND EACH NOTE AND CERTIFICATE PURCHASER HEREBY AGREE THAT ANY SUCH
ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY,
IRRESPECTIVE OF WHICH PARTY COMMENCES SUCH ACTION OR PROCEEDING.
SECTION 9.20. Option. At any time prior to the expiration or
termination of the Lease, upon the occurrence of an Environmental Event and at
the direction of the Majority Holders of the B-Notes and Certificates, (i) the
Trustee shall have the right, upon five Business Days' written notice, to
require the Company to purchase all of its right, title and interest in and to
the Property from the Trustee for a purchase price of $1 in which case the
Trustee will convey its right, title and interest in and to the Property to the
Company free and clear of any Lien or other adverse interest of any kind
created by the Trustee or any person claiming by, through or under the Trustee
(except as consented to by the Company and except as to any interest created
upon the exercise of any right under any Operative Document upon any Event of
Default). The exercise by the Trustee of its rights under this Section 9.20
shall not limit the Trustee's other rights under any Operative Document.
SECTION 9.21. Financial Advisor. The parties hereto
acknowledge and agree that neither CSI, the Company's exclusive financial
advisor for the transactions contemplated by the Operative Documents, nor any
of Citicorp's Affiliates, is making any representation or warranty, or is
required to make any disclosure, now or in the future, with respect to the
parties' tax or accounting treatment of the transactions
79
contemplated by the Operative Documents. Each of the parties hereto further
acknowledges and agrees that neither Citicorp nor any of its Affiliates is
responsible, or will be responsible in the future, for tax and accounting
advice with respect to the transactions contemplated by the Operative
Documents, and that it (i) has, independently and without reliance on Citicorp
or its Affiliates, made its own analysis and decisions with respect to such
matters and has had the benefit of the advice of its own independent tax and
accounting advisers with respect to such matters to the extent it has deemed
appropriate and (ii) will, independently and without reliance on Citicorp or
its Affiliates, continue to make its own analyses and decisions with respect to
such matters based on such information and advice as it deems appropriate for
such purposes.
SECTION 9.22. Securities Representation. Each Purchaser
hereby represents that it is acquiring its Instruments for investment for its
own account, and not with a view to or for sale in connection with a
distribution of any Instrument, except in compliance with all applicable
securities laws; provided, however, that, subject to Section 6.02 hereof, the
disposition of any Instrument held by that Purchaser shall at all times be
within its exclusive control.
SECTION 9.23. UNENFORCEABILITY OF ORAL AGREEMENTS; (TEXAS
STATUTORY LANGUAGE). THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THE PARTIES
AGREE THAT THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
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IN WITNESS WHEREOF the parties have caused this
Participation
Agreement to be duly executed by their officers thereunto duly authorized as of
the day and year first above written.
FERRO CORPORATION
By:/s/ D. ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Name: D. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Treasurer
STATE STREET BANK AND TRUST COMPANY, not
in its individual capacity, except as
expressly stated herein, but solely as
Trustee
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Vice President
CITIBANK, N.A., as Agent
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name:
Title:
SIGNATURE PAGE FOR
PARTICIPATION AGREEMENT
CITICORP, USA, Inc., as Note
Purchaser
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name:
Title:
SIGNATURE PAGE FOR
PARTICIPATION AGREEMENT
CITICORP, USA, Inc., as Certificate
Purchaser
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name:
Title:
SCHEDULE I
MANNER OF PAYMENT
AND COMMUNICATIONS TO PARTIES
This Schedule I shows the names and addresses of the parties
to the foregoing
Participation Agreement and the respective principal and
stated amounts of the Instruments to be purchased by each Note and Certificate
Purchaser.
Company and Construction Agent:
Address for all notices:
Ferro Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: Treasurer and Director - Legal Affairs
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Trustee:
(l) Address for all notices:
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Corporate Trust Department
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(2) All payments to the Trustee with respect to the Operative Documents
shall be made by wire transfer of immediately available funds to
Account No. 4068 42224 at Citibank, N.A., ABA# ▇▇▇▇▇▇▇▇▇, Attention:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, with a reference to "1995 Ferro Plant Trust" and with
sufficient information to identify the source and application of such
funds.
3
Agent:
(1) Address for all notices:
Citibank, N.A., as Agent
Bank Loan Syndications
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(2) All payments and transfers of funds to the Agent with respect to the
Operative Documents shall be made by wire transfer of immediately
available funds to Account No. ▇▇▇▇▇▇▇▇ at Citibank, N.A.,
New York,
ABA# ▇▇▇▇▇▇▇▇▇, with a reference to "
Ferro Corporation" and with
sufficient information to identify the source and application of such
funds.
4
Purchasers:
CITICORP, USA, INC.
Interim Note Commitment
$24,787,428.98
Note Commitment
Total: $ 47,045,000
Series 1 A-Note: $ 19,274,597.58
Series 1 B-Note: $2,982,973.44
(1) All payments with respect to the Operative Documents shall be made by
wire transfer of immediately available funds to Credit Account No.
▇▇▇▇▇▇▇▇ (Account Name: Loan Paydown Account) at Citibank, N.A., ABA#
▇▇▇▇▇▇▇▇▇,
New York, New York, with a reference to "1995 Ferro Plant
Trust" and with sufficient information to identify the source and
application of such funds.
(2) Address for all notices in respect of payment:
Citibank, N.A.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇/▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, SSO
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(3) Address for all other communications:
Citibank, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇/▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telex: NYNIC
5
CITICORP, USA
Certificate Commitment
$1,600,000
Series 1 Certificate Commitment
$688,378.48
Series 2 Certificate Commitment
$911,621.52
(1) Address for all notices in respect of payment:
Citibank, N.A.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇/▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, SSO
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(2) Address for all other communications:
Citibank, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇/▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telex: NYNIC
(3) All payments with respect to the Operative Documents shall be made in
accordance with such instructions as the Certificate Purchaser may give from
time to time.
6
SCHEDULE II
--------------------------------------------------------------------------------
Basis for Pricing Company's long term Company's long
senior unsecured term senior
debt is rated at unsecured debt is
least BBB-/Baa3 rated less than
BBB-/Baa3
--------------------------------------------------------------------------------
FACILITY FEE
--------------------------------------------------------------------------------
Facility Fee on 0.1875% 0.25%
unused portion of
Note Commitment
--------------------------------------------------------------------------------
Facility Fee on 0.1875% 0.25%
unused portion of
Certificate
Commitment
--------------------------------------------------------------------------------
APPLICABLE MARGIN
--------------------------------------------------------------------------------
Interim Notes 0.513402% 0.638402%
--------------------------------------------------------------------------------
A-Notes 0.50% 0.625%
--------------------------------------------------------------------------------
B-Notes 0.60% 0.725%
--------------------------------------------------------------------------------
7
Schedule 4.01(l)
Existing Encumbrances
The information on this Schedule 4.01(l) may identify encumbrances
which would constitute Permitted Encumbrances.
8
Annex 5.7.a
Easement rights of public utilities if any, located in Mandalay Avenue, N.E.,
vacated street, within the premises under examination.
Affects Parcel 3.
The premises are subject to an easement for Water Meter Vault, from Dart
Industries Inc., to City of Cleveland, a municipal corporation of State of
Ohio, filed for record May 19, 1978 at 12:56 A.M., established by instrument
recorded in Volume 14801, Page 449 of Cuyahoga County Records.
Affects Parcel 1.
The premises are subject to an easement for Electric Transmission Line from
Javcob, Inc., to The Cleveland Electric Illuminating Company, an Ohio
Corporation, filed for record September 23, 1969 at 3:27 P.M., established by
instrument recorded in Volume 12557, Page 899 of Cuyahoga County Records.
Affects Parcel 3.
ANNEX 5.7.b.
Tract 1:
The following easements as shown by plat recorded in Volume 388-206, Page 26,
Deed Records of Tarrant County, Texas, and as shown on survey plat dated
September 13, 1995, amended October 12, 1995, prepared by ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇,
Registered Public Surveyor No. 1600:
1. Twenty foot by twenty foot (20' x 20') public open space easement across
the Northwest, South and most Southerly Southeast corners;
2. A fifty-six and one-half foot (56.5') fire lane and utility easement and a
utility easement extending across the property in an East to West direction;
3. A twenty-six foot (26') fire lane and utility easement extending across a
portion of the property in a North to South direction; and
4. A twenty-five foot (25') public utility easement along a portion of the
Easterly part of the property.
Fifteen foot (15') storm drain easement crossing Northerly part of property in
an East to West direction, as shown by City of Fort Worth files, and
encroachment of concrete block building, concrete, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇ track, and one-story metal building into said easement, all as shown on
survey dated September 13, 1995, amended October 12, 1995, prepared by ▇▇▇▇▇▇▇▇
▇. ▇▇▇▇, Registered Public Surveyor No. 1600.
The following as shown by survey dated September 13, 1995, amended October 12,
1995, prepared by ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Registered Public Surveyor No. 1600:
1. Horizontal tank and portion of one story metal building encroaching into 26
foot fire lane and utility easement;
2. Electrical lines and power pole outside 26 foot utility easement;
3. Transformer with related underground electric lines located Northeast of
intersection of 26 foot fire lane and utility easement and 56.5 foot fire lane
and utility easement;
4. Rights of the Forth Worth Belt Railway Co. in and to the spur track
extending across the West part of property on the North side;
5. Electric line and power pole extending into Northwest part of property on
the West side;
6. Encroachment of hot well onto property from the Easterly side;
7. Protrusion of fat trap and metal and concrete block building on Easterly
side;
8. Elevated building and tank protruding over the most easterly property line;
9. Fence extending across 26 foot fire lane and utility easement on North side;
10. Telephone line, sprinkler system, water meter, water valve and pipes in the
Southwest corner.
The premises are subject to an easement for Railroad Siding and Switch Tract
between Anchor Rubber Products, Inc. and The Euclon Corporation, and The ▇▇▇▇▇▇
Appliance Company, established by instrument recorded in Volume 6082, Page 291
and in Volume 6212, Page 345 of Cuyahoga County Records.
Affects Parcel 1.
In the deed from ▇▇▇▇▇▇ ▇. Reader and ▇▇▇▇▇▇▇ ▇. Reader, Co-Trustees to
Synthetic Products Company, a Delaware Corporation, filed for record February
5, 1991 at 3:31 P.M. and recorded in Volume 91-0619, Page 44 of Cuyahoga County
Records, conveying premises under examination, the following appears:
"The Grantors, however, SAVE, EXCEPT and RESERVE unto themselves, a future
non-exclusive right of access, at their own risk and under terms and conditions
hereinafter set forth, along any operable railroad sidetrack which may be
installed upon the real property being conveyed hereunder (the "Property"), for
purposes of providing a rail connection between the Grantors' adjoining property
(as shown on the Lot Split and Consolidation Plat, dated August 23, 1989 and
Supplemented January 9, 1991, (the "Plat") prepared by A. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
Surveys Company, Registered Professional Land Surveyor No. 4432 and recorded as
Instrument No. 27976 in Cuyahoga County Records) and the main railroad
right-of-way located northeast of the Property; provided, however, that such
access right shall not arise and vest in the Grantors until such a railroad
sidetrack is actually installed and connected to the main access right, upon
vesting, shall be at all times subject to the Grantee's prior right to use of
such railroad sidetrack in its business operations. The Grantor's adjoining
property, as shown on the Plat, is referred to herein as the "Benefitted
Parcel". In the event such a right of access does not arise and vest in the
Grantors within twenty-one (21) years after the date of this instrument, the
terms and provisions of this reservation and all rights of the Grantors
hereunder, if any, shall expire and terminate, and be of no further force or
effect. This reservation shall never be construed or interpreted as creating any
right or interest in the Grantors in, on, over, under or upon any portion of the
Property other than within or upon the aforementioned railroad sidetrack.
In the event such a railroad sidetrack is installed upon the Property and
connected to the main railroad right-of-way, resulting in such right of access
arising and vesting in the
Grantors, the Grantors hereby release and discharge the Grantee and its
employees, officers, invitees, contractors and agents from any liability
whatsoever for any injury, loss, damage or expense arising from the use or
condition of the railroad sidetrack, or in any way related thereto. The
Grantors hereby indemnify and agree to defend and hold harmless the Grantee
from and against any claim, demand, action, cause of action, loss, expense,
damage or injury relating to or arising from the Grantors' use or the condition
of any railroad sidetrack located upon the Property. The Grantee shall have no
obligation or responsibility to the Grantors with respect to the physical
condition or maintenance of any such railroad sidetrack. Any right of access
arising hereunder shall be appurtenant to and solely for the benefit of the
Benefitted Parcel, and shall expire and terminate, and be of no further force
or effect, upon the first to occur of the following: (1) removal of any
railroad sidetrack from the Property, or (2) removal of the portion of
railroad sidetrack located upon the Benefitted Parcel.
The words "Grantors" and "Grantee" as used in this instrument shall be deemed
to include their respective successors and assigns. The terms and provisions of
this instrument shall run with the land and shall be binding upon the inure to
the benefit of the respective parties hereto and their respective successors
and assigns."
The premises are subject to a Pipeline easement by and between Synthetic
Products Company, an Ohio corporation, and The ▇▇▇▇▇▇ ▇. Reader Trust, filed
for record February 5, 1991 at 3:21 P.M., established by instrument recorded in
Volume 91-0620, Page 11 of Cuyahoga County Records.
Duties and obligations imposed upon the owner of the estate created by the
easements described in Schedule A hereof.
Survey dated October 5, 1995 by ▇▇▇▇▇ Surveys Co. shows the following:
A. Electric wires extend from Parcel 1 onto premises to the West;
B. Chain link fence on Parcel 1 encroaches 5.8' onto premises to the Northwest;
Policy No. 0486912-C2 T-CLV Page: 6
C. Building on Parcel No. 1 encroaches 5.6' onto premises to the Northwest;
D. Building on Parcel 1 encroaches 0.15' over the Southerly line;
E. Building on Parcel 1 encroaches 0.46', 0.32' and 0.10' along the Easterly
line;
F. Chain link fence encroaches 0.3' over the Southwesterly corner of Parcel 3;
G. Overhead wires extend from Parcel 3 onto premises to the North.
Taxes for the year 1995 are a lien, but not yet due and payable.
Exhibit F to the
Participation Agreement
FORM OF REQUISITION
To: Citibank, N.A., as Agent
FERRO CORPORATION
CERTIFIED CONSTRUCTION REQUISITION NO. __________
DATED _____________________, 199__
I, [Name], [Officer] of
Ferro Corporation (the "Company"),
acting as construction agent (the "Construction Agent") for State Street Bank
and Trust Company, as Trustee (the "Trustee") pursuant to the Agency Agreement
dated October 31, 1995 (the "Agency Agreement"), submit this irrevocable
Requisition and certify, on behalf of the Company, the following:
1. The total amount of the Actual Project Costs for which a
Funding is hereby requested is _____________ Dollars ($___________).
Each of the Note Purchasers is hereby requested to make an Advance on
[at least 5 Business Days after the submission date] _______________,
19__, subject to the satisfaction or waiver of all conditions precedent
thereto. The Advance shall be made at [bank], account number [ ].
2. The proceeds of the Funding requested herein shall be used
solely to pay Actual Project Costs.
3. No part of the Actual Project Costs paid with the funds
advanced under any previous Requisition is a basis for this
Requisition, and none of the Actual Project Costs which are the subject
of this Requisition was included in any prior Requisition.
4. Attached to this Requisition is a copy of each invoice,
purchase order, receipt or other such document (the "Invoices") for
Actual Project Costs in an amount in excess of $_______, which Invoices
will be, or have been, paid with the proceeds of this Funding, or, as
applicable, the previous Fundings.
5. Construction of the Financed Improvements to date has been
performed in a good and workmanlike manner, substantially in accordance
with the Construction Plans and in compliance with all Insurance
Requirements, the Facility Agreements, all Laws and Legal Requirements.
6. There has been no material change in the estimated time of
completion of construction of the Improvements and the Construction
Agent has no reason
F-1
to believe that (i) the Final Completion Date cannot be achieved by March 31,
1997 or (ii) the Actual Project Costs of the Construction of the Improvements
will exceed the Total Commitment.
7. No applicable Law prohibits, and no litigation, governmental
investigation or other proceeding is pending or, to the knowledge of the
Company, threatened in which there is a reasonable possibility of an
unfavorable judgment, decree, order or other determination which could prevent
or make unlawful, or impose any material adverse condition upon, the Parcels,
the Improvements or the construction or operation thereof or any transaction
contemplated hereby or by any other Operative Document or the ability of the
Company to perform its obligations hereunder or thereunder or, to the Company's
knowledge, State Street's ownership of the Improvements and the Parcels.
8. All amounts previously advanced pursuant to previous Requisitions
were or will be paid to the parties entitled thereto as specified in such
Requisitions.
9. All proceeds from the Investment have been applied solely to Actual
Project Costs as required under the Operative Documents.
10. [Except as set forth in this item 10,] all conditions precedent to
the Funding requested herein set forth in the
Participation Agreement (as
defined below) have been satisfied: [identify unfulfilled conditions, the
actions being taken by the Construction Agent to satisfy such conditions and
the date(s) by which the Construction Agent plans to satisfy such conditions].*
11. All of the representations and warranties of each of the Company
and the Construction Agent set forth in the Operative Documents are true and
correct on and as of the date hereof or, as applicable, on and as of the date
specified in such representation and warranty. The Company and the Construction
Agent are
----------------------
* Waiver of any such unfulfilled condition precedent shall be effected solely
in accordance with Section 9.04 of the
Participation Agreement.
F-2
each in compliance with all of their obligations under the Operative
Documents and there exists no Default, Event of Default or
Environmental Trigger under the Operative Documents and no Termination
Notice has been delivered or been deemed to have been delivered.
All terms not defined herein shall have the meanings given in the
Participation Agreement dated as of October 31, 1995, among the Company, the
Trustee, the financial institutions and Persons named therein and Citibank,
N.A., as Agent, as the same may be amended, modified or supplemented from time
to time (the "Participation Agreement").
Dated this day of , 199 .
FERRO CORPORATION
as Construction Agent
By: ----------------------------
Name:
Title:
Accepted by:
CITIBANK, N.A., as Agent*
By: ----------------------------
Name:
Title:
--------------
* Acceptance by the Agent shall not constitute waiver of any unfulfilled
condition precedent identified in item 10 above; any such waiver shall only
be effective in accordance with Section 9.04 of the Participation Agreement.
F-3
EXHIBIT G TO THE
PARTICIPATION AGREEMENT
[FORM OF FINAL COMPLETION CERTIFICATE]
OFFICER'S CERTIFICATE
Ferro Corporation furnishes this Officer's Certificate pursuant to the
requirements of Section 3.02(b) of the Participation Agreement dated as of
October 31, 1995, among Ferro Corporation (the "Company"); State Street Bank and
Trust Company, not in its individual capacity, except as set forth herein, but
solely as Trustee (the "Trustee"); Citibank, N.A., as agent ("the Agent"); and
the Persons and financial institutions named therein as Purchasers (as the same
may undergo amendment, modification or supplementation from time to time, the
"Participation Agreement"). Capitalized terms used but not otherwise defined
herein shall have the meanings provided in the Participation Agreement.
The undersigned, on behalf of the Company, hereby certifies that:
1. The Property and the construction and operation of the Improvements are in
compliance in all material respects with all applicable Laws (including,
without limitation, all Environmental Laws); and
2. All Permits (including without limitation permanent certificates of
occupancy) that are or will become Applicable Permits have been obtained,
except Applicable Permits customarily obtained or which are permitted by Law to
be obtained after the Final Completion Date (in which case the Company, having
completed all appropriate diligence, shall have no reason to believe that such
Permits will not be granted in the usual course of business prior to the date
that such Permits are required by Law and the Company shall have applied for
such Permits and satisfied all legal requirements necessary to authorize
continued operation while the Permit application is pending). All such obtained
Permits shall be in proper form, in full force and effect and not subject to
any appeal or contest or to any unsatisfied conditions (other than conditions
relating to completion in the future) that may allow modification or revocation.
3. The construction and operation of the Improvements accords in all material
respects with all representations set forth in, or made in connection with, all
Permits, as
required for occupancy and commencement of operation thereof.
4. The Company complies with all Insurance Requirements and has full force and
effect all insurance policies required thereunder.
5. The representations and warranties of the Company as set forth in the
Operative Documents are true and correct as if made on and as of the date
hereof, or, as applicable and as of the date specified in such representation
or warranty.
6. The Company has performed in all material respects each of its covenants
set forth in Section 3.02 of the Participation Agreement.
Date: FERRO CORPORATION
-------------------
By:
-----------------------------
Name:
Title:
2
EXHIBIT H TO THE
PARTICIPATION AGREEMENT
[FORM OF INDEPENDENT ENGINEER'S CERTIFICATE]
This Independent Engineer's Certificate is being furnished pursuant to
the requirements of Section 3.02(c) of the Participation Agreement dated as of
October 31, 1995, among Ferro Corporation (the "Company"); State Street Bank
and Trust Company, not in its individual capacity, except as set forth therein,
but solely as Trustee (the "Trustee"); Citibank, N.A., as Agent ("the Agent");
and the Persons and financial institutions named therein as Purchasers (as the
same may be amended, modified or supplemented form time to time, the
"Participation Agreement"). Capitalized terms used but not otherwise defined
herein shall have the meanings provided in the Participation Agreement.
The undersigned hereby certifies that:
1. Each Plant installation has been mechanically completed and
electrically checked, and piping and equipment have been flushed and pressure
tested.
2. Each Plant has demonstrated production capability during a
continuous 72 hour period of at least 90% of nameplate capacity of stearic
acid, stearates, stabilizers and lubricants, as applicable to each such Plant,
meeting product design specifications for such products during such test
period and at levels of efficiency acceptable to the Agent, the Trustee and the
Majority Purchasers.
2. With respect to the environmental improvements, each Plant has
demonstrated at least 90% of the design recovery at levels of efficiency
acceptable to the Agent, the Trustee and the Majority Purchasers.
In making this certification, I [relied on production records provided
to me by the Company] [observed performance tests at the Plant].
Dated: _______________ CHEM SYSTEMS, INC.
By: __________________________
H-1
Exhibit I
Form of Commitment Reduction Notice
Citibank, N.A., as Agent
Bank Loan Syndications
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
State Street Bank and Trust Company
▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
The Purchasers as set forth on Schedule I
to the Participation Agreement
Re: 1995 Ferro Plant Trust
Reference is made to the Participation Agreement dated as of October
31, 1995 (the "Participation Agreement") among Ferro Corporation, an Ohio
corporation; State Street Bank and Trust Company, a Massachusetts trust
company, not in its individual capacity except as expressly stated therein, but
solely as Trustee under the Declaration; the financial institutions named as
Purchasers on Schedule I thereto, and/or any assignee thereof who may, from
time to time, become a party thereto; and Citibank, N.A., in its capacity as
agent for the Purchasers thereunder. Capitalized terms used but not otherwise
defined herein shall have the meanings set forth in the Participation Agreement
(including by reference to Appendix A thereto).
This constitutes a Commitment Reduction Notice delivered in accordance
with Section 1.05 of the Participation Agreement.
The Company has elected to eliminate the Excluded Assets from the
Financed Improvements. Pursuant to Section 1.05 of the Participation Agreement,
the Company hereby notifies the Agent and the Trustee as follows:
1. The aggregate Total Commitment is reduced to $ .
2. Attached hereto for your review and approval, as Attachments A, B, C,
D or E respectively, as applicable, are:
(a) a construction budget, prepared in the manner specified for
Approved Construction Budget, taking into account elimination of
costs for the Excluded Assets;
(b) a list of the Excluded Assets;
[(c) if applicable, the Construction Contract(s) reflecting the
elimination of the Excluded Assets;]
[(d) if applicable, the Construction Plans reflecting the elimination
of the Excluded Assets;] and
(e) a revised Exhibit A to the Agency Agreement.
FERRO CORPORATION
By:__________________________________
Name:
Title:
Dated: ___________________, 199______
Confirmed and Accepted:
CITIBANK, N.A., as Agent
By:_________________________________
Name:
Title:
Dated:_____________________, 199____
2
Execution Version
APPENDIX A TO THE PARTICIPATION AGREEMENT
This Appendix A to the Participation Agreement is a glossary
of all or substantially all of the defined terms used in the Operative
Documents. Not all of the terms defined in this Appendix A are used in the
Participation Agreement.
All references herein to one gender shall include the other
and all references to the singular shall include the plural and vice-versa.
"A-Notes" has the meaning set forth in Article I of the
Declaration.
"Act" means the Securities Act of 1933, as amended, and the
Laws promulgated or issued from time to time thereunder.
"Actual Project Costs" has the meaning set forth in Recital E
of the Preliminary Statement to the Participation Agreement.
"Additional Costs" has the meaning set forth in item II of
Schedule B to the Lease.
"Additional Improvements" has the meaning set forth in
paragraph 10(a) of the Lease.
"Additional Rent" has the meaning set forth in paragraph 4(b)
of the Lease.
"Adjusted Capitalized Cost" has the meaning set forth in
Schedule C to the Lease.
"Advance" has the meaning set forth in Section 1.04(a)(i) of
the Participation Agreement.
"Advisory Fee" has the meaning set forth in Section 2.01(f) of
the Participation Agreement.
"Affiliate" when used with respect to a Person, means any
other Person which directly or indirectly through one or more intermediaries
controls, or is controlled by, or is under common control with, such Person.
The term "control" (including the correlative term "controlled") means the
possession, directly or indirectly, of the power to direct or cause the
direction
of the management and policies of a Person, whether through the ownership of
Voting Stock, by contract or otherwise; provided, however, that under no
circumstances shall the Agent or the Purchasers be deemed to be Affiliates of
the Trustee or vice versa.
"Agency Agreement" has the meaning set forth in Recital C to
the Preliminary Statement to the Participation Agreement.
"Agent" means Citibank, N.A., or any successor selected
pursuant to the Participation Agreement, acting as agent for the Purchasers.
"Allocated Assets" has the meaning set forth in paragraph 14A
of the Lease.
"Allocated Termination Value" has the meaning set forth in
paragraph 14A of the Lease.
"Applicable Law" has the meaning set forth in Section 9.18 of
the Participation Agreement.
"Applicable Margin" means:
(i) with respect to the Notes:
(a) for any Applicable Rate determined by reference to the
LIBO Rate, the applicable percentage shown on Schedule II to the Participation
Agreement based on the debt rating of the Company on the first day of such
Interest Period; and
(b) with respect to any Applicable Rate determined by
reference to the Base Rate, 0%.
(ii) with respect to the Certificates:
(a) for any Applicable Rate determined by reference to the
LIBO Rate, 3%; and
(b) for any Applicable Rate determined by reference to the
Base Rate, 2.25%.
"Applicable Percentage" has the meaning set forth in Article I
of the Declaration.
2
"Applicable Permit" means any Permit, including any
Environmental Permit, that is necessary to own, construct, start-up, test,
maintain, operate, lease or use all or any part of the Parcel or the Property
or any part thereof in accordance with the Operative Documents.
"Applicable Rate" means the Applicable Margin plus, subject to
Section 6.01 of the Participation Agreement, either (A) the applicable LIBO
Rate or (B) the Base Rate; provided, however, that the Applicable Rate shall
never exceed the Maximum Rate.
"Appraisal" has the meaning set forth in Section 2.01(o) of
the Participation Agreement.
"Appraiser" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co., SC or another
appraiser satisfactory to the Agent and the Majority Holders.
"Approved Construction Budget" means the budget prepared by
the Company, in form and substance satisfactory to the Agent, which budget
specifies the estimated Actual Project Costs including: (a) all labor,
materials and services necessary for the design, engineering, construction
(including any fees which may be due to the Construction Agent), testing and
start-up of the Improvements in accordance with the Construction Plans and (b)
all interest and Distribution expenses, Facility Fees and Upfront Fees
anticipated by the Company incident to the Advances made under the Interim
Notes and the Investment made under the Certificates and the expenses to be
incurred in connection with the design, engineering, procurement, construction,
testing and start-up of the Improvements, as the same may be amended from time
to time in accordance with the provisions of the Participation Agreement and
the Agency Agreement.
"Assets" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Assignee" has the meaning set forth in Section 6.02(b) of the
Participation Agreement.
"Assignor" has the meaning set forth in Section 6.02(b) of the
Participation Agreement.
3
"Assignment and Acceptance" has the meaning set forth in
Article I of the Declaration.
"B-Notes" has the meaning set forth in Article I of the
Declaration.
"Bankruptcy Law" means Title 11 of the United States Code, and
any applicable Federal, state or local insolvency, reorganization, moratorium,
fraudulent conveyance or similar Law now or hereafter in effect for the relief
of debtors.
"Base Rate" means a fluctuating interest rate per annum as
shall be in effect from time to time which rate per annum shall at all times be
equal to the higher of:
l. the rate of interest announced publicly by Citibank
in New York, New York, from time to time, as its base rate; and
2. one-half of one percent (.5%) per annum above the
Federal Funds Rate.
"Base Rate Funding" means a Funding for which the Applicable
Rate is determined by the Base Rate.
"Bedford Plant" means the production facility of the Company
located in ▇▇▇▇▇▇ Hills, Ohio.
"Best's" means Best's Insurance Reports published by A.M. Best
Company, Inc. or any successor thereto which is a nationally recognized
statistical rating organization.
"▇▇▇▇ of Sale" has the meaning set forth in Recital A to the
Preliminary Statement to the Participation Agreement.
"Break Costs" means an amount equal to the amount (if any)
required to compensate any Purchaser for any losses (including, without
limitation, any loss, cost or expense incurred by reason of the liquidation or
redeployment of deposits or funds acquired by such Purchaser (from third
parties including Affiliates) to fund or maintain such Notes or Certificates)
it may incur as a result of (i) the Company's payment of the Offer Purchase
Price, the Residual Guaranty, Unwind Fee or
4
Termination Value other than on a Payment Date or (ii) any purchase of such
Purchaser's Notes or Certificates in connection with the substitution of such
Purchaser pursuant to Section 6.04(b) of the Participation Agreement other than
on a Payment Date.
"Business Day" means any day other than a Saturday, Sunday or
any other day on which banking institutions in New York, New York or Boston,
Massachusetts are required or authorized by Law to suspend operations.
"Casualty" has the meaning set forth in paragraph 12(a) of the
Lease.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act, as amended by the Superfund Amendments and
Reauthorization Act, 42 U.S.C. Section 9601 et seq. and as further amended
from time to time.
"CERCLIS" means the Comprehensive Environmental Response
Compensation and Liability Information System, which is a list maintained by
the United States Environmental Protection Agency of sites where there is a
known or suspected release or potential release of hazardous substances which
may require remediation.
"Certificate Commitment" of any Purchaser means the commitment
of such Person, if any, to make an Investment pursuant to the Certificates up
to the aggregate stated amount set forth below the name of such Person on
Schedule I to the Participation Agreement under the heading "Total Certificate
Commitment," as the same may be adjusted from time to time pursuant to any
Assignment(s) and Acceptance(s) executed by such Purchaser or reduced pursuant
to the terms of the Participation Agreement.
"Certificate Liquidation Amount" has the meaning set forth in
Article I of the Declaration.
"Certificate Percentage" means, with respect to any
Certificate Purchaser, the percentage that its Certificate Commitment bears to
the aggregate Total Certificate Commitment, as such Certificate Percentage may
be adjusted from time to time pursuant to any
5
Assignment(s) and Acceptance(s) executed by any such Purchaser.
"Certificate Purchaser" means any Purchaser who has a
Certificate Commitment.
"Certificate Purchaser's Counsel" means, collectively, such
law firms, or successors thereto, which from time to time represent the
Certificate Purchasers in connection with the Certificates.
"Certificates" has the meaning set forth in Article I of the
Declaration.
"Charges" means Impositions and all liabilities with respect
thereto, other than Excluded Charges.
"Citibank" has the meaning set forth in the first paragraph of
the Participation Agreement.
"Closing Costs" means all charges incident to any sale of the
Property, including reasonable attorneys' fees of Special Counsel and Trustee's
Counsel and escrow fees, recording fees, broker's fees, any fees, costs
(including, without limitation, Break Costs) or expenses incurred by the
Trustee in connection with the same and with the release of the Declaration,
and all applicable transfer taxes which may be imposed by reason of such sale
and conveyance and the delivery of any and all instruments in connection
therewith.
"Closing Date" has the meaning set forth in paragraph 15(a) of
the Lease.
"CNAI" means Citicorp North America, Inc.
"Code" means the Internal Revenue Code of 1986, as amended,
and the Laws promulgated or issued from time to time thereunder.
"Commission" has the meaning set forth in Section 4.01(d) of
the Participation Agreement.
"Commitment Reduction" has the meaning set forth in Section
1.05(a) of the Participation Agreement.
6
"Commitment Reduction Notice" has the meaning set forth in
Section 1.05(a) of the Participation Agreement.
"Commitments" means the Certificate Commitments and the Note
Commitments of the respective Purchasers.
"Company" means Ferro Corporation, an Ohio corporation, and
any permitted successor or assignee pursuant to the terms of the Participation
Agreement.
"Condemnation" has the meaning set forth in paragraph 12(a) of
the Lease.
"Connecticut Assets" has the meaning set forth in Section 1.06
of the Participation Agreement.
"Consolidated" refers to the consolidation of the accounts of
the Company with its Subsidiaries in accordance with GAAP and with policies,
including principles of consolidation, consistent with those applied in the
preparation of the consolidated financial statements referred to in Section
4.01(d) of the Participation Agreement.
"Construction Agent" means the Company, as Construction Agent,
pursuant to the Agency Agreement.
"Construction Contract" means any agreements between the
Company and each contractor, pursuant to which such contractors have agreed to
construct and install the Financed Improvements.
"Construction Period" has the meaning set forth in paragraph
3(a) of the Lease.
"Construction Plans" means the working drawings and
specifications for the construction of the Financed Improvements including,
without limitation, the documentation provided by the Construction Agent, as
the same may be amended from time to time in accordance with the provisions of
the Agency Agreement.
"Construction Schedule" means the construction schedule for
the Financed Improvements, as the same may be amended or supplemented from time
to time in accordance with the provisions of the Agency Agreement.
7
"Conversion Date" means any date on which the basis for the
determination of the Applicable Rate with respect to any Instrument (or any
portion thereof) is converted pursuant to Article VI of the Participation
Agreement or for any other reason pursuant to the terms of the Operative
Documents from the LIBO Rate to the Base Rate or from the Base Rate to the LIBO
Rate, as the case may be.
"Convert," "Conversion" and "Converted" each refers to a
conversion of Base Rate Fundings into LIBO Rate Fundings or LIBO Rate Fundings
into Base Rate Fundings, as the case may be.
"Conveyance Documents" means the Texas Deed, the Ohio Deed,
the Easement, the Second Easement and the ▇▇▇▇ of Sale.
"Corporate Trust Office" has the meaning set forth in Article
I of the Declaration.
"CSI" means Citicorp Securities, Inc.
"Debt" means (a) indebtedness for borrowed money, (b)
obligations to pay the deferred purchase price of property or services (other
than services of former, present or future directors or employees), (c)
obligations evidenced by notes, bonds, debentures or other similar instruments,
(d) obligations as lessee under leases that have been or should be, in
accordance with GAAP, recorded as capital leases, (e) Guaranties in respect of
indebtedness or obligations of others of the kinds referred to in clauses (a)
through (d) above, and (f) liabilities in respect of unfunded vested benefits
under plans covered by Title IV of ERISA.
"Declaration" or "Declaration of Trust" has the meaning set
forth in Recital D of the Preliminary Statement to the Participation Agreement.
"Deeds" means the Ohio Deed and the Texas Deed.
"Default" means an event which with the lapse of time, the
giving of notice or both would become an Event of Default.
8
"Default Rate" means the lesser of: (i) the Maximum Rate and
(ii) 2% percent in excess of the Applicable Rate then in effect.
"Disclosed Information" means all information contained in any
public report filed by the Company with the Commission and all other
information delivered to Special Environmental Counsel prior to the Financing
Closing Date, including, but not limited to, the Phase II, the Purchase
Agreement and any exhibit or schedule thereto delivered to Special
Environmental Counsel prior to the Financing Closing Date.
"Distribution" has the meaning set forth in Article I of the
Declaration.
"Easement" means the Easement Agreement dated as of the date
hereof among the Company and the Trustee.
"Easement Parcels" means, collectively, the Ohio Easement
Parcels, the Texas Leasehold Parcel and the Texas Easement Parcel.
"Eligible Assignee" means (i) any Person approved by the Agent
and the Company, such approval not to be unreasonably withheld or delayed and
(ii) each financial institution named as a party to the Revolving Credit
Facility.
"Employee Benefit Plan" means any employee benefit plan within
the meaning of Section 3(3) of ERISA which the Company or any ERISA Affiliate
administers or administered, operates or operated, contributes to or
contributed to, sponsors or sponsored, or under which the Company or any ERISA
Affiliate is obligated or was obligated for or on behalf of its current or
former employees, officers or directors.
"Environmental Action" means any administrative, regulatory or
judicial action, suit, demand, demand letter, claim, notice of non-compliance
or violation, notice of liability or potential liability, investigation,
proceeding, consent order or consent agreement arising under any Environmental
Law or Environmental Permit or relating to Hazardous Materials or arising from
alleged injury or threat of injury to health, safety or the environment,
including, without limitation, (a) by any governmental or regulatory
9
authority for enforcement, cleanup, removal, response, remedial or other
actions or damages and (b) by any governmental or regulatory authority or any
third party for damages, contribution, indemnification, cost recovery,
compensation or injunctive relief.
"Environmental Consultant" means ERM-Northeast, Inc. or such
other reputable environmental consulting firm satisfactory to the Agent and the
Purchasers.
"Environmental Condition" has the meaning set forth in Recital
B to the Preliminary Statements of the Services Agreement.
"Environmental Event" has the meaning set forth in paragraph
13(a) of the Lease.
"Environmental Laws" means any and all Federal, state and
local Laws (as well as obligations, duties and requirements relating thereto
under common law) relating to: (a) emissions, discharges, spills, releases or
threatened releases of pollutants, contaminants, Hazardous Materials, materials
containing Hazardous Materials, or hazardous or toxic materials or wastes into
ambient air, surface water, groundwater, watercourses, publicly or
privately-owned treatment works, drains, sewer systems, wetlands, septic
systems or onto land; (b) the use, treatment, storage, disposal, handling,
manufacturing, transportation, or shipment of Hazardous Materials, materials
containing Hazardous Materials or hazardous and/or toxic wastes, material,
products or by-products (or of equipment or apparatus containing Hazardous
Materials); (c) pollution or the protection of human health or the environment;
or (d) land use laws.
"Environmental Permit" means any Permit, approval,
identification number, license or other authorization required under any
Environmental Law.
"Environmental Trigger" has the meaning set forth in paragraph
13(b) of the Lease.
"Equipment Sale Offer" has the meaning set forth in Section
1.06 of the Participation Agreement.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, any
10
regulations and the Laws promulgated or issued from time to time thereunder and
any successor legislation.
"ERISA Affiliate" means any Person that for purposes of Title
IV of ERISA is a member of the Company's controlled group, or under common
control with the Company, within the meaning of Section 414 of the Internal
Revenue Code.
"ERISA Event" means (a) the occurrence of a reportable event,
within the meaning of Section 4043 of ERISA, with respect to any Title IV Plan
unless the 30-day notice requirement with respect to such event has been waived
by the PBGC; (b) the application for a minimum funding waiver with respect to a
Pension Plan required to satisfy Code Section 412; (c) the provision by the
administrator of any Title IV Plan of a notice of intent to terminate such plan
pursuant to Section 4041(a)(2) of ERISA (including any such notice with respect
to a plan amendment referred to in Section 4041(e) of ERISA); (d) the cessation
of operations at a facility of the Company or any of its ERISA Affiliates in
the circumstances described in Section 4062(e) of ERISA; (e) the withdrawal by
the Company or any of its ERISA Affiliates from a Multiple Employer Plan during
a plan year for which it was a substantial employer, as defined in Section
4001(a)(2) of ERISA; (f) the failure by the Company or any of its ERISA
Affiliates to make a payment to a Pension Plan if the conditions for the
imposition of a lien under Section 302(f)(1) of ERISA are satisfied; (g) the
adoption of an amendment to a Pension Plan requiring the provision of security
to such Plan, pursuant to Section 307 of ERISA; or (h) the institution by the
PBGC of proceedings to terminate a Title IV Plan, pursuant to Section 4042 of
ERISA, or the occurrence of any event or condition described in Section 4042 of
ERISA that could reasonably be expected to constitute grounds for the
termination of, or the appointment of a trustee to administer, a Title IV Plan;
or the imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA; or (i) the partial
or complete withdrawal within the meaning of Sections 4203 and 4205 of ERISA of
the Company or any ERISA Affiliate from a Multiemployer Plan; or (j) any event
or condition which results in the reorganization or insolvency of a
Multiemployer Plan under Sections 4241 or 4245 of ERISA; (k) any event or
condition which results in the termination of a
11
Multiemployer Plan under Section 4041A of ERISA or the institution by the PBGC
of proceedings to terminate a Multiemployer Plan under Section 4042 of ERISA;
or (l) the failure to make any required contribution to a Title IV Plan.
"Event of Default" has the meaning set forth in Section 7.01
of the Participation Agreement.
"Excess Funds" has the meaning set forth in paragraph 12(c) of
the Lease.
"Excluded Assets" has the meaning set forth in Recital B to
the Preliminary Statement to the Participation Agreement.
"Excluded Charges" means (1) Taxes imposed on the Trustee's
net income, and franchise Taxes imposed on it, to the extent such Tax is
determined solely by reference to the fees received by the Trustee under the
Operative Documents; (2) United States federal income Taxes (other than Taxes
withheld at the source) imposed on a Purchaser to the extent that such Tax is
determined solely on the basis that such Purchaser is a creditor entitled to
receive only payments of interest and principal (without discount) for such Tax
purposes; (3) Taxes imposed on a Purchaser's net income and franchise Taxes
imposed on it, by the jurisdiction under the Laws of which it is organized or
by any jurisdiction in which it is doing business or by any political
subdivision of the foregoing, to the extent that such Tax is determined solely
on the basis that such Purchaser is a creditor entitled to receive only
payments of interest and principal (without discount) for such Tax purposes;
and (4) any Taxes imposed by the United States of America by means of
withholding at the source if and to the extent that (a) such Taxes shall be in
effect and shall be applicable, on the date hereof or the effective date of the
Assignment and Acceptance pursuant to which such Person became a Note and/or
Certificate Purchaser and (b) such Taxes are determined solely on the basis
that such Purchaser is a creditor entitled to receive only payments of interest
and principal (without discount) for such Tax purposes; provided, however, that
any such Taxes are not incurred or increased directly or indirectly by actions
of the Company on or after the date of the Participation Agreement (other than
actions specifically required of
12
the Company thereunder or under another Operative Document).
"Expiration Date" has the meaning set forth in paragraph 3 of
the Lease.
"Expiration Title Policy" has the meaning set forth in Section
7.05(b) of the Participation Agreement.
"Facility Agreements" has the meaning set forth in paragraph
3(d) of the Agency Agreement.
"Facility Fee" has the meaning set forth in Section 9.14(b) of
the Participation Agreement.
"Federal Funds Rate" means, 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 of
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 Citibank from three Federal funds
brokers of recognized standing selected by it.
"Federal Reserve Board" means the Board of Governors of the
Federal Reserve System or any successor thereto.
"Fee Parcels" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Final Completion Date" means the date on and as of which the
Company has delivered to the Agent and the Trustee (i) a fully executed
Officer's Certificate in the form of Exhibit G to the Participation Agreement
and (ii) a fully executed Independent Engineer's Certificate in the form of
Exhibit H to the Participation Agreement, together with all applicable
attachments, which date shall be no later than March 31, 1997.
"Financed Improvements" has the meaning set forth in Recital B
of the Preliminary Statement to the Participation Agreement.
13
"Financing Closing" has the meaning set forth in Section 1.02
of the Participation Agreement.
"Financing Closing Date" has the meaning set forth in Section
1.02 of the Participation Agreement.
"Fixed Rent" has the meaning set forth in item I.A of Schedule
B to the Lease.
"Funding" means a funding of Actual Project Costs specified in
an approved Requisition, which Funding shall consist of Advances and
Investments made by the Purchasers, pursuant to Section 1.04 of the
Participation Agreement.
"Funding Costs" means any loss, cost or expense incurred by
any Note or Certificate Purchaser as a result of any failure to fulfill on or
before the date specified in any Requisition the applicable conditions set
forth in Article II of the Participation Agreement, including, without
limitation, any loss, cost or expense incurred by reason of the liquidation or
redeployment of deposits or other funds acquired by such Purchaser (from third
parties, including Affiliates) to fund the Advance or make the Investment, as
the case may be, to be made by such Purchaser when such Funding, as a result of
such failure, is not made on such date.
"GAAP" means generally accepted accounting principles
(including principles of consolidation), in effect from time to time,
consistently applied.
"Guaranty" of any Person means and includes any agreement or
arrangement pursuant to which such Person assumes, guarantees, endorses or
otherwise becomes directly or contingently liable (including, without
limitation, liable by way of agreement, contingent or otherwise, to purchase,
to provide funds for payment, to supply funds to or otherwise invest in the
debtor or otherwise to assure the creditor against loss) in connection with any
Debt or indebtedness of any other Person.
"Hazardous Materials" means (1) hazardous materials, hazardous
wastes, and hazardous substances as those or similar terms are defined under
any Environmental Laws, including, but not limited to, the following: the
Hazardous Materials Transportation Act, 49
14
U.S.C. Section 1801 et seq., as amended from time to time, the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq., as amended from
time to time, CERCLA, the Clean Water Act, 33 U.S.C. Section 1251 et seq., as
amended from time to time, the Clean Air Act, 42 U.S.C. Section 7401 et seq.,
as amended from time to time and/or the Toxic Substances Control Act, 15 U.S.C.
Section 2601 et seq., as amended from time to time; (2) petroleum and
petroleum products including crude oil and any fractions thereof; (3) natural
gas, synthetic gas, and any mixtures thereof; (4) asbestos and/or any material
which contains any hydrated mineral silicate, including, but not limited to,
chrysolite, amosite, crocidolite, tremolite, anthophylite and/or actinolite,
whether friable or non-friable; (5) polychlorinated biphenyls ("PCB's"), or
PCB-containing materials, or fluids; (6) radon; (7) any other hazardous
radioactive, toxic or noxious substance, material, pollutant, or solid, liquid
or gaseous waste; and (8) any substance that, whether by its nature or its use,
is subject to regulation under any Environmental Law or with respect to which
any Federal, state or local Environmental Law or governmental agency requires
environmental investigation, monitoring or remediation.
"Holder" has meaning set forth in Article I of the
Declaration.
"Illegality Costs" means any additional amounts as may be
necessary to compensate any Note Purchaser for any losses, costs, interest and
fees incurred by it in making any conversion of Applicable Rate in accordance
with Section 6.01(i) of the Participation Agreement.
"Impositions" means without limitation all Taxes, assessments,
levies, fees, water and sewer rents and charges, inspection fees and other
authorization fees and all other governmental charges, general and special,
ordinary and extraordinary, foreseen and unforeseen, of every character
(including all penalties, additions to tax, fines or interest thereon) arising
directly or indirectly out of the transactions contemplated by the
Participation Agreement and the other Operative Documents, including (i) those
which, at any time prior to or during the Term, may accrue with respect to, be
imposed or levied upon or assessed against or be a Lien upon (A) the Parcel,
the Property or any part thereof, or the Operative Documents, including the
Instruments, (B) the Trustee in connection with the transactions
15
contemplated by the Operative Documents, or (C) the Deeds, the Lease or the
leasehold estate thereby created, or which arise in respect of the acquisition,
ownership, construction, operation, occupancy, possession, disposition, use,
non-use, financing, leasing, sub-leasing or condition of the Parcel, the
Property or any part thereof or of the execution, delivery, expiration or
termination of the Lease, the Instruments or any other Operative Document; (ii)
those which may be imposed or levied upon, assessed against or measured by any
Fixed Rent, Additional Rent or other sum payable under the Lease, the
Instruments, the Participation Agreement or any other Operative Document; (iii)
all sales, value added, use and similar Taxes at any time levied, assessed or
payable on account of the ownership, operation, occupancy, use, leasing, or
subleasing of the Parcel, the Property or any part thereof; (iv) all charges,
levies, fees, rents or assessments for or in respect of utilities,
communications and other services rendered or used on or about the Parcel, the
Property or any part thereof; and (v) payments in lieu of each of the
foregoing.
"Improvements" has the meaning set forth in Recital B of the
Participation Agreement.
"Increased Costs" means any additional amounts, as set forth
in a reasonably detailed certificate submitted to the Company as to the amounts
and basis for such amounts, sufficient to compensate any Purchaser for any
increased costs or reduced return on capital as a result of funding or
maintaining such Purchaser's Notes or Certificates, as the case may be,
(including, without limitation, any such increased costs that are a result of
the imposition of any reserve, special deposit, capital adequacy or similar
requirement against assets of, or deposits with or for the account of, or
credit extended by such Purchaser) as a result of (i) the introduction or
implementation after the Financing Closing Date of any applicable Law or any
change therein, or any change in the interpretation or administration thereof
by any governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or (ii) the compliance by any
Purchaser (or its purchasing office) with any guideline or request (whether or
not having the force of Law) of any such authority, central bank or comparable
agency, which becomes effective after the date hereof, has the effect of
16
increasing the cost or reducing the rate of return on capital to any Purchaser
in respect of its agreeing to make, making, funding or maintaining its Notes or
Certificates. Notwithstanding the foregoing, amounts that relate to periods
prior to six months before the Company's receipt of the certificate notifying
it of such amounts shall not constitute "Increased Costs" hereunder.
"Indemnified Party" has the meaning set forth in Section
9.15(a) of the Participation Agreement.
"Independent Engineer" means Chem Systems, Inc. or any other
construction engineering firm satisfactory to the Agent and the Majority
Purchasers.
"Independent Engineer's Certificate" has the meaning set forth
in Section 3.02(c) of the Participation Agreement.
"Initial Advance" has the meaning set forth in Section 1.03(b)
of the Participation Agreement.
"Initial Improvements" has the meaning set forth in Recital A
to the Preliminary Statement to the Participation Agreement.
"Initial License Improvements" has the meaning set forth in
Recital A to the Preliminary Statement to the Participation Agreement.
"Initial Ohio Fee Improvements" has the meaning set forth in
Recital A to the Preliminary Statement to the Participation Agreement.
"Initial Texas Fee Improvements" has the meaning set forth in
Recital A to the Preliminary Statement to the Participation Agreement.
"Instrument Guaranty" has the meaning set forth in Recital F
of the Preliminary Statement to the Participation Agreement.
"Instruments" has the meaning set forth in Article I of the
Declaration.
"Insufficiency" means, with respect to any Plan, the "unfunded
current liability" of the Plan,
17
within the meaning of Section 412 (or any successor provision thereto) of the
Code.
"Insurance Requirements" has the meaning set forth in
paragraph 1(a) of the Lease.
"Intellectual Property Rights" has the meaning set forth in
Section 4.01(q)(ii) of the Participation Agreement.
"Interest Period" means at any time that the Applicable Rate
is determined by reference to the LIBO Rate,
(i) prior to the Interim Note Maturity Date in the first
instance the period commencing on and including the date of a Funding
(in respect of the Interim Notes and Certificates), including the
Financing Closing Date, and, in the case of each subsequent and
successive Interest Period applicable thereto, respectively, on the
last day of the immediately preceding Interest Period, and
(ii) thereafter the period commencing on and including the
Interim Note Maturity Date and, in the case of each subsequent and
successive Interest Period applicable thereto, on the last day of the
immediately preceding Interest Period,
and, in each case, ending on (x) with respect only to the Short-Term LIBO
Period, the Interim Note Maturity Date or the Expiration Date, as applicable, or
(y) with respect to all periods other than the Short-Term LIBO Period, the same
numerical day in the first, second, third or sixth calendar month thereafter, in
each case to the extent available, as selected by the Company by written notice
(which may, prior to the Interim Note Maturity Date be contained in a
Requisition) to the Agent given at least three (3) Business Days before the
Interest Setting Date with respect to such Interest Period; provided that:
(a) with respect to the Interim Notes, no
Interest Period for any Advance shall extend beyond the Interim Note
Maturity Date, and with respect to the Instruments, no Interest Period
shall extend beyond the Expiration Date;
18
(b) if any Interest Period would otherwise end on
a day which is not a LIBO Business Day, that Interest Period shall be
extended to the next succeeding LIBO Business Day unless the result of
such extension would be to carry such Interest Period into another
calendar month, in which event such Interest Period shall end on the
immediately preceding LIBO Business Day;
(c) for purposes of calculating interest on the
Instruments and/or Fixed Rent for any Interest Period, such
calculations shall include the first day but exclude the last day of
any such Interest Period;
(d) any Interest Period that begins on the last
LIBO Business Day of a calendar month (or on a day for which there is
no numerically corresponding day in the calendar month at the end of
such Interest Period) shall end on the last LIBO Business Day of the
calendar month at the end of such Interest Period; and
(e) there may not be more than an aggregate of
six (6) Interest Periods in effect at any one time.
The Company shall select each Interest Period by giving
written notice, whether by Requisition or otherwise, in accordance with Section
6.01(b) of the Participation Agreement. If the Company fails to provide the
written notice as specified above, the Company shall be deemed to have selected
the Applicable Rate by reference to the Base Rate for the Instruments or the
applicable Advance(s), as the case may be.
"Interest Setting Date" means, (a) with respect to any
Interest Period for which the Applicable Rate is determined by reference to the
LIBO Rate, the date which is three LIBO Business Days before the first day of
such Interest Period or (b) with respect to any period for which the Applicable
Rate is determined by reference to the Base Rate, the date specified by the
Company, in the written notice delivered by the Company pursuant to Section
6.01(a) of the Participation Agreement, as the first day that such Applicable
Rate is to apply.
19
"Interim Note Commitment" of any Purchaser means the
commitment of such Person, if any, to make Advances pursuant to the Interim
Notes up to the aggregate principal amount set forth below the name of such
Person on Schedule I to the Participation Agreement under the heading "Interim
Note Commitment", as the same may be adjusted from time to time pursuant to any
Assignment(s) and Acceptance(s) executed by such Purchaser or reduced pursuant
to the terms of the Participation Agreement.
"Interim Note Maturity Date" means the earlier of (i) the
Final Completion Date and (ii) March 31, 1997.
"Interim Note Maturity Formula" means that, on the Interim
Note Maturity Date, (i) A-Notes shall be issued in an aggregate principal
amount equal to (x) the aggregate outstanding principal and stated amount of
the Interim Notes and Series 2 Certificates times (y) .84; and (ii) B-Notes
shall be issued in an aggregate outstanding principal amount equal to (x) the
aggregate principal and stated amount of the Interim Notes and Series 2
Certificates minus (y) the aggregate outstanding principal and stated amounts
of the A-Notes (to be issued pursuant to clause (i) above) and the Series 2
Certificates.
"Interim Notes" has the meaning set forth in Article I of the
Declaration.
"Interim Trust Estate" has the meaning set forth in Article I
of the Declaration.
"Investment" has the meaning set forth in Section 1.01(b) of
the Participation Agreement.
"ISI" means Insurance Solvency International.
"Law" means any law (including, without limitation, any zoning
law or ordinance, ERISA, any Environmental Law, or Legal Requirements), treaty,
directive, statute, rule, regulation, ordinance, order, directive, code,
interpretation, judgment, decree, injunction, writ, determination, award,
Permit, license, authorization, direction, requirement or decision of or
agreement with or by any government or governmental department, commission,
board, court, authority, agency,
20
official or officer having jurisdiction of the matter in question.
"Lease" has the meaning set forth in Recital B to the
Preliminary Statement to the Participation Agreement.
"Legal Requirements" has the meaning set forth in paragraph
6(b) of the Lease.
"Lessee" means the Company, as Lessee under the Lease.
"Lessor" means the Trustee, as Lessor under the Lease.
"Lessor Group" has the meaning set forth in paragraph 2(b) of
the Lease.
"Lessor Termination Notice" has the meaning set forth in
paragraph 12(b)(ii) of the Lease.
"LIBO Business Day" means a day of the year on which dealings
are carried on in the London interbank market and banks are open for business
in London and not required or authorized to close in New York City.
"LIBO Rate" means, for each Interest Period, an interest rate
per annum equal to the rate of interest per annum at which deposits in United
States dollars (approximately equal in amount to the Notes or the applicable
portion thereof) are offered to leading banks in the London interbank market at
11:00 a.m. (London time) on the Interest Setting Date for a period equal to
such Interest Period determined on the basis of the provisions set forth below:
(A) On the Interest Setting Date, CNAI will determine the
interest rate for deposits in United States dollars for a period equal to that
of the Interest Period to which such Interest Setting Date relates which
appears on the Telerate Page 3750 as of 11:00 a.m. (London time) on such date
or if such page on such service ceases to display such information, such other
page as may replace it on that service for the purpose of display of such
information (the "Telerate Rate"). If such rate does not appear on the
Telerate, then the rate will be determined in accordance with (B) below.
21
(B) If CNAI is unable to determine the Telerate Rate,
then on the Interest Setting Date, CNAI will determine the arithmetic mean
(rounded if necessary to the nearest one-hundredth percent (1/100%)) of the
interest rate for a period equal to that of the Interest Period to which such
Interest Setting Date relates quoted on Reuters Screen page "LIBO" or (1) if
such page on such service ceases to display such information, such other page
as may replace it on that service for the purpose of displaying such
information or (2) if that service ceases to display such information, such
page as displays such information on such service (or, if more than one, that
one approved by the Agent) as may replace the Reuters Screen, as at or about
11:00 a.m. (London time) on that Interest Setting Date (the rate quoted as
aforesaid being the "LIBOR Screen Rate"). If CNAI is to make a determination
pursuant to this paragraph and one or more of the LIBO Screen Rates required
for such determination shall be unavailable, the determination shall be made on
the basis of those rates which are available.
"LIBO Rate Funding" means a Funding for which the Applicable
Rate is determined pursuant to the LIBO Rate.
"LIBO Rate Reserve Percentage" for any Interest Period for all
LIBO Rate Fundings means the reserve percentage applicable two Business Days
before the first day of such Interest Period under regulations issued from time
to time by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement (including, without
limitation, any emergency, supplemental or other marginal reserve requirement)
for a member bank of the Federal Reserve System in New York City with respect
to liabilities or assets consisting of or including Eurocurrency Liabilities as
defined in Regulation D (or with respect to any other category of liabilities
that includes deposits by reference to which the interest rate on LIBO Rate
Funding is determined) having a term equal to such Interest Period.
"License Assignment" means the assignment of Synpro's license
interest in the License Parcel to the Trustee.
22
"License Parcel" has the meaning set forth in Recital A to the
Preliminary Statement to the Participation Agreement.
"Lien" means any deed to secure debt, mortgage, deed of trust,
pledge, security interest, security title, encumbrance, lien, judgment lien,
writ of execution, attachment or charge of any kind, including without
limitation any agreement to give any of the foregoing, any conditional sale or
other title retention agreement, any lease in the nature thereof, and the
filing of or agreement to give, any security interest or financing statements
under the UCC or under any applicable personal property security act or any
comparable Law of any jurisdiction.
"Liquidation Event" has the meaning set forth in Article I of
the Declaration.
"Losses" has the meaning set forth in Section 9.15(a) of the
Participation Agreement.
"Majority Holders" has the meaning set forth in Article I of
the Declaration.
"Majority Purchasers" means, at any time, the Purchasers
holding at least 66-2/3% of the aggregate unpaid principal of the Notes and the
aggregate unpaid stated amount of the Certificates.
"Margin Stock" shall have the meaning assigned to that term in
Regulation G and Regulation U.
"Material Adverse Change" means any material adverse change in
the business, condition (financial or otherwise), operations, performance or
properties of the Company or the Company and its Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on
any of: (a) the Company and its Subsidiaries, taken as a whole, or the
Company's ability to perform its obligations under the Operative Documents; (b)
the value, condition, marketability or operation of the Property or the
Trustee's ownership thereof or (c) the validity or enforceability of any of the
Operative Documents.
23
"Maturity Date" has the meaning set forth in Article I of the
Declaration.
"Maximum Budget Amount" has the meaning set forth in paragraph
5(a) of the Agency Agreement.
"Maximum Rate" has the meaning set forth in Section 9.18 of
the Participation Agreement.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and any
successor thereto which is a nationally recognized credit rating organization.
"Mortgage" has the meaning set forth in paragraph 20(d) of the
Lease.
"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) (or any successor provision thereto) of ERISA, to which
the Company or any ERISA Affiliate is making or accruing an obligation to make
contributions, or has within any of the preceding five plan years made or
accrued an obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees
of the Company or any of its ERISA Affiliates and at least one Person other
than the Company and its ERISA Affiliates or (b) was so maintained and in
respect of which the Company or any of its ERISA Affiliates could have
liability under Section 4064 or 4069 of ERISA in the event such plan has been
or were to be terminated.
"Net Proceeds" has the meaning set forth in paragraph 12(a) of
the Lease.
"1995 Ferro Plant Trust" has the meaning set forth in Section
2.01 of the Declaration.
"Notes" has the meaning set forth in Article I of the
Declaration.
"Note Commitment" of any Purchaser means such Purchaser's
Interim Note Commitment plus such Purchaser's Series 1 Note Commitment.
24
"Noteholder" has the meaning set forth in Article I of the
Declaration.
"Note Purchaser" means any Purchaser who has a Note
Commitment.
"NPL" has the meaning set forth in Section 4.01(r)(ii) of the
Participation Agreement.
"Offer Purchase Price" has the meaning set forth in paragraph
15(b) of the Lease.
"Offer to Purchase" has the meaning set forth in paragraph 14
of the Lease.
"Officer" of any Person means the president, any vice
president or any other duly authorized and responsible officer of such Person.
"Officer's Certificate" or "Officers' Certificate" of a Person
means a certificate signed by an Officer or Officers of such Person.
"Ohio Deed" means the warranty deed from Synpro to the Trustee
conveying the Ohio Fee Parcel.
"Ohio Easement Parcel" has the meaning set forth in Recital A
of the Preliminary Statement to the Participation Agreement.
"Ohio Fee Parcels" has the meaning set forth in Recital A of
the Preliminary Statement to the Participation Agreement.
"Ohio Parcels" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Ohio Plant" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Ohio Title Policy" has the meaning set forth in Section
2.01(g) of the Participation Agreement.
"Operative Documents" means the Participation Agreement, the
Deeds, the Agency Agreement, the Lease, the Declaration, the Instruments, the
▇▇▇▇ of Sale, the
25
Instrument Guaranty and the Services Agreement, the Release Agreement, the
Easement and the Second Easement.
"Original Capitalized Cost" has the meaning set forth in item
I.B of Schedule B to the Lease.
"Other Charges" has the meaning set forth in Section 9.18 of
the Participation Agreement.
"Other Taxes" has the meaning set forth in Section 6.03(c) of
the Participation Agreement.
"Outstanding" with respect to any Instrument, has the meaning
set forth in Article I of the Declaration.
"Parcels" means, collectively, the Fee Parcels, the Easement
Parcels and the License Parcel.
"Partial Lease Termination" has the meaning set forth in
Section 14A of the Lease.
"Partial Lease Termination Closing Date" has the meaning set
forth in Section 14A of the Lease.
"Participation Agreement" means the Participation Agreement
dated as of October 31, 1995 by and among the Company, the Trustee, Citibank,
as Agent and the Purchasers, to which this Appendix is appended, as the same
may be amended, modified or supplemented from time to time.
"Payment Date" means:
(a) With respect to the Interim Notes, (i) the Interim Note
Maturity Date, (ii) each Conversion Date and (iii) the last day of
each three month period after the Financing Closing Date through the
Interim Note Maturity Date;
(b) With respect to the Series 1 A-Notes and the Series 1
B-Notes, (i) the Expiration Date, (ii) each Conversion Date and (iii)
the last day of each three month period after the Financing Closing
Date through the Expiration Date;
(c) With respect to the Series 2 A-Notes and the Series 2
B-Notes, (i) the Expiration Date, (ii)
26
each Conversion Date and (iii) the last day of each three month period
after the Interim Note Maturity Date through the Expiration Date;
(d) With respect to the Certificates, (i) the Interim Note
Maturity Date, and (ii) during the Primary Term, each day that is a
Payment Date for the A-Notes and the B-Notes under clause (b) above;
(e) With respect to any Note, the maturity date thereof
(whether by acceleration or otherwise); and
(f) With respect to any Instrument, the date of any
prepayment.
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Pension Plan" means any Employee Benefit Plan which is
subject to the provisions of Title IV of ERISA or Section 412 of the Code and
which the Company or any ERISA Affiliate (a) maintains, sponsors, contributes
to, is obligated under, operates or administers for employees of the Company or
any ERISA Affiliate or (b) has, at any time within the preceding 6 years,
maintained, sponsored, contributed to, been obligated under, operated or
administered for the employees of the Company or any of their current or former
ERISA Affiliates.
"Pennsylvania Assets" has the meaning set forth in Section
1.06 of the Participation Agreement.
"Percentage" means, with respect to any Note Purchaser, the
percentage that its Note Commitment bears to the aggregate Total Note
Commitment, as such Percentage may be adjusted from time to time pursuant to
any Assignment(s) and Acceptance(s) executed by any such Purchaser.
"Permit" means any approval, certificate of occupancy,
consent, waiver, exemption, variance, franchise, order, permit, authorization,
right or license of or from any Federal, state or local government or agency or
subdivision thereof.
27
"Permitted Encumbrances" means, with respect to the Property,
but only to the extent applicable thereto, any of the following: (i) rights
reserved to or vested in any municipality or public authority, by the terms of
any franchise, grant, license, Permit or provision of Law, to purchase,
condemn, appropriate or recapture, or designate a purchaser of, the Property;
(ii) any liens thereon for Impositions and any liens of mechanics, materialmen
and laborers for work or services performed or materials furnished in
connection with the Property, in each instance, which are not due and payable,
or which are being contested in good faith by the Lessee pursuant to paragraphs
11 and 18 of the Lease; (iii) rights reserved to or vested in any municipality
or public authority to control or regulate the use of the Property or to use
the Property in any manner; (iv) easements, rights-of-way, servitudes,
restrictions and other minor defects, encumbrances and irregularities in title
to the Property which do not, individually or in the aggregate, materially and
adversely affect the value, condition, marketability or operation of the
Property or the Trustee's ownership thereof; and (v) the Lease, the ▇▇▇▇ of
Sale, the Deeds and the Declaration; and (vi) Liens existing on the Financing
Closing Date and set forth on a Title Policy.
"Permitted Investments" has the meaning set forth in Article I
of the Declaration.
"Permitted Liens" means any of the following:
(i) any mortgage, lien, encumbrance or pledge
existing on October 31, 1995;
(ii) any mortgage, lien, encumbrance or pledge given
by any Subsidiary to secure indebtedness owing to the Company or to a wholly
owned Subsidiary of the Company;
(iii) any purchase money mortgage or other lien on
property (other than the Property), real or personal, acquired or constructed
by the Company or any Subsidiary to secure the purchase price of such property
(or to secure indebtedness incurred for the purpose of financing the
acquisition or construction of any such property), or any mortgage or other
lien existing on any such property at the time of acquisition, whether or not
assumed, or any mortgage or other lien existing on any
28
property of any corporation at the time it becomes a Subsidiary, or any
conditional sales agreement or other title retention agreement with respect to
any property hereafter acquired; provided, however, that the aggregate
principal amount of the indebtedness secured by all such mortgages and other
liens on a particular parcel of property shall not exceed the cost of such
property, including the improvements thereon; and provided, further, that any
such mortgage or lien does not spread to other property thereafter acquired or
constructed other than additions to such property;
(iv) refundings or extensions of any mortgage,
pledge or other lien or encumbrance permitted by this definition of Permitted
Liens for amounts not exceeding the principal amount of the indebtedness so
refunded or extended at the time of the refunding or extension thereof, and
covering only the same property thertofore securing the same;
(v) any deposit, lien or pledge to enable the
Company or any Subsidiary to exercise any privilege or license, or to secure
payments of workers' compensation, unemployment insurance, old age pensions or
other social security, or to secure the performance of bids, tenders, contracts
or leases to which any such Person is a party, or to secure public or statutory
obligations of any such Person or to secure surety, stay or appeal bonds to
which any such Person is a party; or any other similar deposit or pledge made
in the ordinary course of business;
(vi) any mechanics', workers', repairmen's,
materialmen's or carriers' lien; or any other similar lien arising in the
ordinary course of business; or any deposit or pledge to obtain the release of
any such lien;
(vii) any lien arising out of a judgment or award
against the Company or any subsidiary with respect to which such Person shall
in good faith be prosecuting an appeal or proceedings for review; or any lien
incurred by any such Person for the purpose of obtaining a stay or discharge in
the course of any legal proceeding to which such Person is a party;
(viii) any lien for taxes contested or not yet
subject to penalties for non-payment, or any
29
minor survey exception, or any minor encumbrance, easement, or reservation of,
or right of another for, any right of way, sewer, electric line, telegraph and
telephone line and other similar purposes, or any zoning or other restriction as
to the use of real properties, which encumbrances, easements, reservations,
rights and restrictions do not in the aggregate materially detract from the
value of said properties or materially impair their use in the operation of the
business of the Person owning the same;
(ix) any mortgage, security interest or lien that
secures
(1) the obligations of the Company to the
Purchasers under this Agreement and the other Operative Documents, or
(2) other Debt of the Company or any such
Subsidiary, provided that in each such case the mortgage, security interest or
other lien shall secure the Company's Debt to the banks under the Revolving
Credit Facility and such other Debt ratably in the proportion of their
respective amounts and the Company shall give the Agent not less than seven (7)
days' prior written notice and shall deliver to the Agent on the execution date
thereof an executed counterpart of the mortgage, security agreement or other
lien instrument and the written opinion of the Company's counsel as to the
Company's compliance with this clause (ix);
(x) any lien, security interest or other charge,
encumbrance, or other type of preferential arrangement that (A) secures
obligations of the Company or any of its Subsidiaries organized in the United
States to their respective former, present or future directors or employees in
their capacities as such or (B) secures obligations of the Company or any of
its Subsidiaries to pay any bank fees, commissions or other charges in respect
of, or reimburse any bank for any draft or other item paid or accepted by that
bank pursuant to or otherwise in respect of, any letter of credit issued or
confirmed by that bank to secure all or any part of the obligations described
in the next preceding clause (A); or
(xi) any mortgage, lien encumbrance or pledge (other
than any permitted by any other clause of
30
this definition of Permitted Liens) securing Debt that does not exceed in the
aggregate $2,500,000 at any one time outstanding.
"Permitted Remediation" has the meaning set forth in paragraph
13(b) of the Lease.
"Person" means any individual, corporation, limited liability
partnership, limited liability company, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
government.
"Phase II" means the Synthetic Products Company Supplemental
Environmental Site Assessment Report prepared by the Environmental Consultant
and dated September 19, 1995.
"Plan" means a Single Employer Plan or a Multiple Employer
Plan.
"Plants" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Prescribed Forms" means such duly executed form(s) or
statement(s), and in such number of copies, which may, from time to time, be
prescribed by Law and which, pursuant to applicable provisions of (a) an income
tax treaty between the United States and the country of residence of the
Purchaser providing the form(s) or statement(s), (b) the Code, or (c) any
applicable rule or regulation under the Code, permit the Company and/or the
Trustee to make payments under the Operative Documents for the account of the
Trustee and/or such Purchaser free of deduction or withholding of income or
similar taxes.
"Primary Term" has the meaning set forth in paragraph 3(a) of
the Lease.
"Proceeding" has the meaning set forth in Article I of the
Declaration.
"Proceeds" has the meaning set forth in paragraph 12(a) of the
Lease.
"Proceeds Trustee" has the meaning set forth in paragraph
12(a) of the Lease.
31
"Property" has the meaning set forth in Recital B of the
Preliminary Statement to the Participation Agreement.
"Property Charges" means all Impositions other than Excluded
Charges and any income, gross receipts, franchise or similar Taxes.
"Purchase Agreement" has the meaning set forth in Recital B of
the Preliminary Statement to the Participation Agreement.
"Purchasers" has the meaning set forth in the first paragraph
of the Participation Agreement.
"Qualified Sale" has the meaning set forth in paragraph 27(c)
of the Lease.
"Record" has the meaning set forth in Section 6.02(d) of the
Participation Agreement.
"Regulation A" means Regulation A of the Federal Reserve
Board, as in effect from time to time.
"Regulation D" means Regulation D of the Federal Reserve
Board, as in effect from time to time.
"Regulation G" means Regulation G of the Federal Reserve
Board, as in effect from time to time.
"Regulation T" means Regulation T of the Federal Reserve
Board, as in effect from time to time.
"Regulation U" means Regulation U of the Federal Reserve
Board, as in effect from time to time.
"Regulation X" means Regulation X of the Federal Reserve
Board, as in effect from time to time.
"Reinvestment Account" has the meaning set forth in Article I
of the Declaration.
"Release Agreement" means the Release Agreement among the
Sellers, the Trustee, the Agent and the Purchasers dated as of October 31,
1995.
"Requisition" has the meaning set forth in Section 1.04(b) of
the Participation Agreement.
32
"Reserve Costs" means, so long as a Note Purchaser shall be
required under regulations of the Federal Reserve Board to maintain reserves
with respect to liabilities or assets consisting of or including Eurocurrency
Liabilities (as defined in Regulation D), additional amounts equal to the
product of (l) the aggregate principal amount of the Notes held by it,
multiplied by (2) an interest rate per annum equal, at all times during the
period in which such reserves were assessed, to the remainder obtained by
subtracting (a) the LIBO Rate for such Interest Period from (b) the rate
obtained by dividing such LIBO Rate for such Interest Period by a percentage
equal to 100% minus the LIBO Rate Reserve Percentage of such Holder, which
amounts shall be payable on each Payment Date.
"Residual Guaranty" has the meaning set forth in Section
7.05(a) of the Participation Agreement.
"Return Conditions" has the meaning set forth in Section
7.05(b) of the Participation Agreement.
"Revolving Credit Facility" means the $150,000,000 Credit
Agreement dated as of August 22, 1990 among the Company, the banks named
therein and National City Bank as agent, as amended from time to time.
"S&P" means Standard & Poor's Ratings Group, a division of
▇▇▇▇▇▇-▇▇▇▇, Inc. and any successor thereto which is a nationally recognized
credit rating organization.
"Sales Proceeds" has the meaning set forth in Article I of the
Declaration.
"Second Easement" means the easement agreement with respect to
the Texas Easement Parcels.
"Secured Obligations" means:
(1) Payment when due of all obligations of the
Company under the Instrument Guaranty which accrue to the benefit
(directly or indirectly) of (a) the Holders of the Applicable
Percentage of the Interim Notes, (b) the Holders of the B-Notes, and
(c) the Holders of the Certificates, and the performance and discharge
of each and every obligation of the Company set forth in the
33
Instrument Guaranty which accrue to the benefit (directly or
indirectly) of (i) the Holders of the Applicable Percentage of the
Interim Notes, (ii) the Holders of the B-Notes, and (iii) the Holders
of the Certificates;
(2) Payment of all Fixed Rent and Additional
Rent, with interest, if any, thereon, according to the terms of the
Lease, and any and all extensions, amendments, modifications,
substitutions or renewals thereof, and payment of the Unwind Fee, if
any, pursuant to the Participation Agreement, which accrue to the
benefit (directly or indirectly) of (a) the Holders of the Applicable
Percentage of the Interim Notes, (b) the Holders of the B-Notes, and
(c) the Holders of the Certificates, and the performance and discharge
of each and every obligation of the Company set forth in the Lease
which accrue to the benefit (directly or indirectly) of (i) the
Holders of the Applicable Percentage of the Interim Notes, (ii) the
Holders of the B-Notes, and (iii) the Holders of the Certificates.
(3) Payment of all other sums, with interest
thereon, owing by the Company and becoming due or payable under the
provisions of any of the Operative Documents which accrue to the
benefit (directly or indirectly) of (a) the Holders of the Applicable
Percentage of the Interim Notes, (b) the Holders of the B-Notes, and
(c) the Holders of the Certificates;
(4) Due, prompt and complete observance and
performance of each and every obligation, covenant and agreement of
the Company contained in any of the Operative Documents which accrue
to the benefit (directly or indirectly) of (a) the Holders of the
Applicable Percentage of the Interim Notes, (b) the Holders of the
B-Notes, and (c) the Holders of the Certificates.
"Sellers" means Synpro, ▇▇▇▇▇▇▇ America, Inc. and ▇▇▇▇▇▇▇
Group, plc.
"Series 1 Certificate Commitment" means that portion of the
financing of the acquisition of the Parcels and the Initial Improvements to be
funded by the
34
issuance of Series 1 Certificates on the Financing Closing Date.
"Series 2 Certificate Commitment" means that portion of the
financing of the Financed Improvements to be funded by the issuance of Series 2
Certificates.
"Series 1 Certificates" has the meaning set forth in Article I
of the Declaration.
"Series 2 Certificates" has the meaning set forth in Article I
of the Declaration.
"Series 1 A-Notes" has the meaning set forth in Article I of
the Declaration.
"Series 2 A-Notes" has the meaning set forth in Article I of
the Declaration.
"Series 1 B-Notes" has the meaning set forth in Article I of
the Declaration.
"Series 2 B-Notes" has the meaning set forth in Article I of
the Declaration.
"Series 1 Note Commitment" means that portion of the financing
of the acquisition of the Parcels and the Initial Improvements to be funded by
the issuance of Series 1 Notes.
"Series 1 Notes" has the meaning set forth in Article I of the
Declaration.
"Series 2 Note Commitment" means that portion of the financing
of the acquisition of the Parcels and the Initial Improvements to be funded by
the issuance of Series 2 Notes.
"Series 2 Notes" has the meaning set forth in Article I of the
Declaration.
"Series A Maximum Amount" has the meaning set forth in Section
3.02 of the Declaration.
"Series A Portion" has the meaning set forth in item I.B of
Schedule B to the Lease.
35
"Series A Trust Estate" has the meaning set forth in Article I
of the Declaration.
"Series B Maximum Amount" has the meaning set forth in Section
3.02 of the Declaration.
"Series B Portion" has the meaning set forth in item I.B of
Schedule B to the Lease.
"Series B Trust Estate" has the meaning set forth in Article I
of the Declaration.
"Series C Maximum Amount" has the meaning set forth in Section
3.03(a)(i) of the Declaration.
"Series C Trust Estate" has the meaning set forth in Article I
of the Declaration.
"Series C Portion" has the meaning set forth in item I.B of
Schedule B to the Lease.
"Services Agreement" has the meaning set forth in Recital G of
the Preliminary Statement of the Participation Agreement.
"Short-Term LIBO Period" means any period ending on the
Interim Note Maturity Date or the Expiration Date and during which an
Applicable Rate determined by reference to the LIBO Rate for a minimum Interest
Period of at least one month is not available.
"Special Counsel" has the meaning set forth in Article I of
the Declaration.
"Special Environmental Counsel" means ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
or such other counsel as shall be reasonably satisfactory to the Agent and the
Purchasers.
"SSBTC" has the meaning set forth in the first paragraph of
the Participation Agreement.
"Stated Rate" has the meaning set forth in Section 9.18 of the
Participation Agreement.
"Substitute Rate" has the meaning set forth in Section 6.01 of
the Participation Agreement.
36
"Subsidiary" means any corporation of which at least a
majority of the Voting Stock is at the time owned directly or indirectly by the
Company or by the Company and its other Subsidiaries.
"Synpro" means Synthetic Products Company, a Delaware
corporation.
"Tax" or "Taxes" means, without limitation, any fee (including
license, filing, recording, transfer and registration fees), foreign, Federal,
state or local tax (including any income, gross receipts, withholding,
franchise, excise, sales, use, value added, real, personal, tangible or
intangible property tax or any tax similar to any of the foregoing taxes),
interest equalization, recording, transfer or stamp tax, assessment (including
any maintenance charge, owner association dues or charges), levy, impost, duty,
charge or withholding of any kind or nature whatsoever, imposed or assessed by
any foreign, Federal, state or local government or agency, or governmental
authority, together with any addition to tax, penalty, fine or interest
thereon.
"Term" has the meaning set forth in paragraph 3 of the Lease.
"Termination Notice" has the meaning set forth in paragraph
12(b)(i) of the Lease.
"Termination Value" has the meaning set forth in Schedule C to
the Lease.
"Texas Deed" means the warranty deed from Synpro to the
Trustee conveying the Texas Parcel.
"Texas Easement Improvements" has the meaning set forth in
Recital A of the Preliminary Statement to the Participation Agreement.
"Texas Easement Parcels" has the meaning set forth in Recital
A of the Preliminary Statement to the Participation Agreement.
"Texas Leasehold Parcel" has the meaning set forth in Recital
A of the Preliminary Statement to the Participation Agreement.
37
"Texas Parcel" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Texas Plant" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Texas Title Policy" has the meaning set forth in Section
2.01(g) of the Participation Agreement.
"Title Company" means a title company acceptable to the Agent.
"Title Policy" has the meaning set forth in Section 2.01(g) of
the Participation Agreement.
"Title IV Plan" means any employee pension benefit plan within
the meaning of Section 3(2) of ERISA, which is covered by Title IV of ERISA.
"Total Commitment" means the aggregate Note Commitments and
Certificate Commitments of all of the Purchasers, not to exceed $48,500,000.
"Total Note Commitment" means the aggregate Note Commitments
of all of the Note Purchasers, not to exceed $47,045,000.
"Transaction Documents" has the meaning set forth in Section
9.18 of the Participation Agreement.
"Transactions" has the meaning set forth in Section 9.18 of
the Participation Agreement.
"Transition Obligation" means the obligation in the amount of
$38 million as a non-recurring charge recognized by the Company as of March 31,
1993 as a result of the Company's adoption of an accounting change pursuant to
Financial Accounting Standards Board Statement No. 106, Employer's Accounting
for Post-Retirement Benefits Other Than Pensions.
"Trust Estate" has the meaning set forth in Article I of the
Declaration.
"Trustee" has the meaning set forth in Article I of the
Declaration.
38
"Trustee's Counsel" has the meaning set forth in Section
2.01(c)(v) of the Participation Agreement or such other counsel as shall be
satisfactory to the Trustee.
"UCC" means the Uniform Commercial Code as in effect from time
to time in any jurisdiction whose Law governs the document in which such term
is used and/or rights thereunder.
"Unwind Event" has the meaning set forth in Section 7.03 of
the Participation Agreement.
"Unwind Fee" has the meaning set forth in Section 7.04 of the
Participation Agreement.
"Upfront Fee" has the meaning set forth in Section 9.14(c) of
the Participation Agreement.
"Voting Stock" means outstanding shares of stock having voting
power for the election of directors, whether at all times or only so long as no
senior class of stock has such voting power because of default in dividends or
some other default.
"Withdrawal Liability" has the meaning set forth under Part I
of Subtitle E of Title IV of ERISA.
39
LEASE
dated as of October 31, 1995,
between
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity
except as expressly stated herein, but solely
as Trustee,
-------
Lessor,
------
and
FERRO CORPORATION,
Lessee
------
THIS LEASE HAS BEEN MANUALLY EXECUTED IN COUNTERPARTS NUMBERED CONSECUTIVELY
FROM 1 TO 13. TO THE EXTENT, IF ANY, THAT THIS LEASE CONSTITUTES CHATTEL PAPER
(AS SUCH TERM IS DEFINED IN THE UNIFORM COMMERCIAL CODE AS IN EFFECT IN ANY
APPLICABLE JURISDICTION), NO SECURITY INTEREST IN THIS LEASE MAY BE CREATED
THROUGH THE TRANSFER OR POSSESSION OF ANY COUNTERPART OF THIS LEASE OTHER THAN
COUNTERPART NO. 1.
This is Counterpart No. __
TABLE OF CONTENTS
(Not a part of the Lease)
Paragraph Page
--------- ----
1. Lease of Property; Title and Condition . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Use; Quiet Enjoyment; Hazardous Materials . . . . . . . . . . . . . . . . . . . . . . . . 2
2A. Construction; Financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
3. Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4. Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
5. Net Lease; Non-Terminability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
6. Taxes and Assessments; Compliance with Law; Certain Agreements . . . . . . . . . . . . . . 7
7. Matters of Title; Assignability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
8. [Intentionally Omitted] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
9. Maintenance, Repair and Property Relocation . . . . . . . . . . . . . . . . . . . . . . . 9
10. Additional Improvements; Removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
11. Lessee's Right to Contest Real Property Taxes . . . . . . . . . . . . . . . . . . . . . . 12
12. Condemnation and Casualty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
13. Environmental Event . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
14. Offer to Purchase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
14A. Partial Lease Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
15. Procedure Upon Purchase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
16. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
17. Subletting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
18. Permitted Contests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
18A. Unwind Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
19. Default Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
20. Additional Rights; Mortgage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
i
Paragraph Page
--------- ----
21. Notices, Demands and Other Instruments . . . . . . . . . . . . . . . . . . . . . . . . . . 32
22. No Default Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
23. Surrender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
24. Separability; Binding Effect; Governing Law; Non-Recourse . . . . . . . . . . . . . . . . 35
25. Headings and Table of Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
26. Lessor's Right to Cure Lessee's Default . . . . . . . . . . . . . . . . . . . . . . . . . 36
27. Lessee's Options Upon Expiration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
28. Limitations on Amounts Payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
29. Waiver of Trial by Jury . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
30. No Merger of Title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
31. Payments to the Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Schedule A - Description of the Parcel
Schedule B - Fixed Rent and Additional Rent Schedule
Schedule C - Termination Value
ii
LEASE dated as of October 31, 1995 (this "LEASE") between STATE STREET
BANK AND TRUST COMPANY, not in its individual capacity except as expressly
stated herein, but solely as TRUSTEE, (the "LESSOR"), having an address at ▇
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and FERRO CORPORATION, an Ohio
corporation (the "LESSEE"), having an address at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇. Schedules A, B and C referred to in this Lease are hereby
incorporated by reference herein. Capitalized terms used but not defined herein
shall have the respective meanings set forth in the Participation Agreement
dated as of the date hereof by and among the Lessee, the Lessor, the financial
institutions and Persons named therein and Citibank, N.A. as Agent (as the same
may be amended, modified or supplemented from time to time, the "PARTICIPATION
AGREEMENT").
Preliminary Statement
---------------------
Lessor has acquired (i) fee title to the Fee Parcels described on
Schedule A hereto, (ii) easement interests in the Easement Parcels described in
Schedule A hereto, (iii) a license in the License Parcel described in Schedule A
hereto and (iv) title to the Initial Improvements. Lessor wishes to lease (or
grant license interests in) the Property to Lessee and Lessee wishes to lease
(or receive license interests in) the same from Lessor.
NOW, THEREFORE, the parties do hereby agree as follows:
1. LEASE OF PROPERTY; TITLE AND CONDITION. (a) In consideration of the
rents and covenants herein stipulated to be paid and performed by the Lessee and
upon the terms and conditions herein specified, (i) the Lessor hereby leases (or
licenses) to Lessee the Property, and (ii) the Lessee hereby leases (or
licenses) from the Lessor the Property; it being intended that Lessee shall take
a lease of the Fee Parcels and the portions of the Improvements located thereon,
and shall take a license with respect to the balance of the Property. The
Property is leased (or licensed, as the case may be) to the Lessee subject to
(x) all applicable Legal Requirements and all of the insurance requirements set
forth in paragraphs 16(a) through (c) hereof (collectively, the "INSURANCE
REQUIREMENTS") now or hereafter in effect; (y) all Permitted Encumbrances; and
(z) the terms, covenants and provisions of this Lease. The Lessee has examined
the Property and title thereto and has found the same satisfactory for all
purposes of this Lease.
(b) THE LESSOR MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED,
WITH RESPECT TO THE PROPERTY OR ANY
FIXTURE OR OTHER ITEM CONSTITUTING A PORTION THEREOF, OR THE LOCATION, USE,
DESCRIPTION, DESIGN, MERCHANTABILITY, SUITABILITY, FITNESS FOR USE FOR ANY
PARTICULAR PURPOSE, CONDITION OR DURABILITY THEREOF OR AS TO THE QUALITY OF THE
MATERIAL OR WORKMANSHIP THEREIN, OR AS TO THE LESSOR'S TITLE THERETO OR
OWNERSHIP THEREOF OR OTHERWISE, IT BEING AGREED THAT ALL RISKS INCIDENT THERETO
ARE TO BE BORNE BY THE LESSEE. IN THE EVENT OF ANY DEFECT OR DEFICIENCY OF ANY
NATURE IN THE PROPERTY OR ANY FIXTURE OR OTHER ITEM CONSTITUTING A PORTION
THEREOF, WHETHER PATENT OR LATENT, THE LESSOR SHALL HAVE NO RESPONSIBILITY OR
LIABILITY WITH RESPECT THERETO. THE PROVISIONS OF THIS PARAGRAPH 1(b) HAVE BEEN
NEGOTIATED AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY AND
ALL WARRANTIES, EXPRESS OR IMPLIED, BY THE LESSOR WITH RESPECT TO THE PROPERTY
OR ANY FIXTURE OR OTHER ITEM CONSTITUTING A PORTION THEREOF, WHETHER ARISING
PURSUANT TO THE UCC OR ANY OTHER LAW, NOW OR HEREAFTER IN EFFECT.
2. USE; QUIET ENJOYMENT; HAZARDOUS MATERIALS. (a) The Lessee shall use
the Property primarily as stearic acid, stearates, lubricants and stabilizers
production facilities, storage facilities and related business offices, in a
first class and reputable manner. The Lessee covenants that it will cause the
Improvements at all times to be located on one or both of the Fee Parcels, the
Easement Parcels or at the Bedford Plant.
(b) During the Term, the Lessor covenants that, unless an Event of
Default, Unwind Event or Environmental Trigger has occurred and is continuing,
it will not, and will not permit any party claiming by or under the Lessor to,
interfere with the peaceful and quiet possession and enjoyment of the Property
by the Lessee; PROVIDED, HOWEVER, that the Lessor, the Agent, the Independent
Engineer, the Environmental Consultant, the Appraiser and their respective
successors, assigns, representatives and agents (the "LESSOR GROUP"), at
Lessor's sole cost and expense, may, upon advance written notice to the Lessee
(unless the Lessor in its sole discretion has reason to believe that a Default
or an Event of Default has occurred or other exigent or emergency conditions
exist, in which case, such entrance and examination shall be at Lessee's sole
cost and expense and no such notice shall be necessary), enter upon and examine
the Property or any part thereof at reasonable times in compliance with and
subject to Lessee's standard safety and security procedures, in effect from time
to time; PROVIDED, FURTHER, that if an Event of Default, Unwind Event or
Environmental Trigger has occurred or if the Lessee has exercised its option to
terminate this Lease pursuant to clause (i) or (ii) of paragraph 27(a), then
Lessee shall give the Lessor Group such additional access to the Property and to
Lessee's books and records relating to the operation, use, maintenance,
construction or occupancy of the
2
Property as it may require for any purpose, including, without limitation, for
marketing, selling, operating or otherwise disposing of the Property.
(c) Lessor, at Lessee's sole cost and expense, shall cooperate or
assist with Lessee's efforts to, file tax returns relating to the Property and
to obtain all services, Permits and contracts necessary and useful for the
construction of the Improvements and the acquisition, operation and maintenance
of the Property for the intended purposes thereof, and the Lessor may, and to
the extent required in paragraph 7(c) shall, execute such documents or papers as
may be reasonably necessary for such purposes. Lessee further covenants that it
shall at its own cost and expense on behalf of and in the name of the Lessor,
apply for, obtain and maintain all Permits required in order to permit the
lawful ownership of the Property by the Lessor during the Term.
(d) Any failure by the Lessor or such other Person to comply with the
foregoing provisions of this paragraph 2 or any other provisions of this Lease
shall not give the Lessee any right to cancel or terminate this Lease, or to
▇▇▇▇▇, reduce or make deduction from or offset against any Fixed Rent,
Additional Rent or other sum payable under this Lease, or to fail to perform or
observe any other covenant, agreement or obligation hereunder.
(e) The Lessee shall, and it shall require and ensure that any and all
sublessees, employees,contractors, subcontractors, agents, representatives,
affiliates, consultants, occupants and any and all other Persons, (i) comply in
all material respects with all applicable Environmental Laws, and (ii) use,
employ, process, emit, generate, store, handle, transport, dispose of and/or
arrange for the disposal of any and all Hazardous Materials in, on or, directly
or indirectly, related to or in connection with the Property or any part thereof
in a manner consistent with prudent industry practice and in material compliance
with all applicable Environmental Laws, and in a manner which does not then pose
a significant recognized risk to human health, safety (including occupational
health and safety) or the environment.
2A. CONSTRUCTION; FINANCING. (a) The Lessee has entered into the
Agency Agreement with the Lessor pursuant to which the Lessee as Construction
Agent has agreed to complete the construction of the Improvements. The
Improvements shall, as the construction of same is completed upon the Fee
Parcels, or the Easement Parcels, as the case may be, become a part of the
Improvements, and title thereto shall remain in the Lessor.
3
(b) In order to finance the acquisition by the Lessor of its interest
in the Parcels and the Initial Improvements and to finance the cost of
construction of the Improvements, the Note Purchasers, as contemplated by the
Participation Agreement, will advance to the Trustee the Actual Project Costs up
to their respective Note Commitments and the Certificate Purchasers will make
Investments in the 1995 Ferro Plant Trust equal to its Certificate Commitment,
and in consideration therefor, the Trustee will issue the Interim Notes, Series
1 A- Notes and Series 1 B-Notes to the Note Purchasers and the Certificates to
the Certificate Purchasers pursuant to the Declaration.
(c) On the Interim Note Maturity Date, the Interim Notes will, as
provided in the Participation Agreement, be refinanced through the issuance of a
specified proportion of Series 2 A-Notes and Series 2 B-Notes to be issued under
the Declaration in an aggregate principal amount equal to the aggregate
principal amount of, and accrued but unpaid interest on, the Interim Notes. The
Lessee agrees to execute and deliver such supplements, amendments, certificates
and other documents which shall reasonably be necessary to effect the issuance
of the Series 2 A-Notes and Series 2 B-Notes.
3. TERM. The Property is leased (or licensed, as the case may be) for
(a) a period of construction (the "CONSTRUCTION PERIOD") which shall commence as
of the date hereof and shall end on the Interim Note Maturity Date; and (b)
thereafter, a primary term (the "PRIMARY TERM" and, collectively with the
Construction Period, the "TERM") ending on October 31, 2000 (the "EXPIRATION
DATE"), or such earlier date as this Lease shall be terminated pursuant to any
provision hereof.
4. RENT. (a) During the Term, Lessee shall pay to the Lessor, Fixed
Rent on each Payment Date in the amounts determined in accordance with Schedule
B hereto.
(b) All amounts that the Lessee is required to pay to the Lessor
pursuant to this Lease (other than Fixed Rent), including, but not limited to,
(i) unpaid Charges and all amounts set forth in paragraph 4(e)(ii) hereof, (ii)
all sums, costs and expenses pursuant to paragraphs 23 and 26 hereof, (iii) all
costs and expenses relating to the Property or the Lessee's use or the Lessor's
ownership thereof, (iv) any and all amounts payable upon transfer or purchase of
(or otherwise relating to) the Property, together with every fine, penalty,
interest and cost that may be added for non-payment or late payment thereof and
(v) Additional Costs, shall constitute "ADDITIONAL RENT". The Lessor shall give
Lessee notice of any Additional Rent due hereunder promptly after it has
knowledge
4
of such Additional Rent, and shall use reasonable efforts to notify Lessee in
advance of the due date and amount of such Additional Rent; provided that
failure to give such prompt notice shall not relieve the Lessee of its
obligation to pay such Additional Rent, subject to, as applicable, the
Lessee's rights, if any, under paragraph 18 hereof.
(c) The Lessee shall pay to the Lessor, within 5 Business Days of
demand therefor, interest at the Default Rate on all amounts payable by it to
the Lessor hereunder from the due date thereof until paid in full.
(d) All amounts payable by the Lessee hereunder shall be paid in lawful
money of the United States of America and in immediately available funds by
11:00 a.m. (New York City time) on the applicable Payment Date or on the date
when due, unless any such due date is not a Business Day in which case payment
shall be due and payable on the next succeeding Business Day with the same force
and effect as if paid on the date otherwise due, at the Lessor's address as set
forth in the Participation Agreement, or at such other address or to such other
person in the United States of America or in such other manner as the Lessor
from time to time may designate to the Lessee by written instructions.
(e) The Lessee shall perform all of its obligations under this Lease at
its sole cost and expense and shall pay, when due and without notice or demand
(except as otherwise provided in this Lease), all amounts due hereunder. The
Lessee agrees to pay within 5 Business Days of demand therefor (i) all Charges
(subject to Lessee's rights pursuant to paragraphs 11 and 18) and (ii) all
indemnity obligations and all charges, reasonable fees, expenses and
out-of-pocket costs of the Lessor, the Purchasers, and the Agent, including,
without limitation, the reasonable fees and expenses of the Lessor's Counsel,
the Special Counsel, the Certificate Purchasers' Counsel, the Appraiser, the
Environmental Consultant, the Independent Engineer and the Special Environmental
Counsel (and in the case of (iii) below, attorneys' fees and expenses of other
counsel to the Purchasers), in connection with or arising out of:
(i) the preparation, execution, delivery,
administration, performance, modification and amendment of this
Lease and the other Operative Documents and any other documents
to be delivered in connection herewith or therewith (other than
any Assignment and Acceptance other than the initial assignment
of the particular percentage interest covered by that Assignment
and Acceptance) or delivered to any person who is a party to the
Operative Documents in connection with the Certificate
Purchasers' Investment (solely to the extent such expenses are
caused
5
by the preparation, execution, delivery, administration,
performance, modification or amendment of this Lease and the
other Operative Documents); and
(ii) any refinancing or refunding of the transactions
contemplated by the Operative Documents, with respect to
advising any of them as to their respective rights and
responsibilities hereunder or thereunder.
In addition, the Lessee agrees to pay within five (5) Business Days of
demand therefor all indemnity obligations and all charges, fees, expenses, and
out-of-pocket costs of the Lessor, the Purchasers, and the Agent, including
without limitation, the fees and expenses of the Lessor's Counsel, the Special
Counsel, the Certificate Purchasers' Counsel, the Appraiser, the Environmental
Consultant, the Independent Engineer, the Special Counsel and other counsel to
the Purchaser, in connection with or arising out of, the enforcement (whether
through negotiations, legal proceedings or otherwise) of the Operative Documents
and such other documents.
5. NET LEASE; NON-TERMINABILITY. (a) This Lease is a net lease and,
except as otherwise expressly provided in this Lease, any present or future Law
to the contrary notwithstanding, shall not terminate, nor shall the Lessee be
entitled to any abatement, reduction, set-off, counterclaim, defense or
deduction with respect to any Fixed Rent, Additional Rent or other sum payable
hereunder. Except as otherwise expressly provided in this Lease, the
obligations of the Lessee shall not be affected by reason of: (i) any damage to
or destruction of the Parcels or the Property or any part thereof by any cause
whatsoever (including, without limitation, by fire, Casualty or act of God or
enemy or any other force majeure event); (ii) any Condemnation, including,
without limitation, a temporary Condemnation of the Parcels or the Property or
any part thereof; (iii) any prohibition, limitation, restriction or prevention
of the Lessee's use, occupancy or enjoyment of the Parcels or the Property or
any part thereof by any Person; (iv) any matter affecting title to the Parcel or
the Property or any part thereof; (v) any eviction of the Lessee from, or loss
of possession by the Lessee of, the Parcel or the Property or any part thereof,
by reason of title paramount or otherwise; (vi) any default by the Lessor
hereunder or under any other agreement; (vii) the invalidity or unenforceability
of any provision hereof or the impossibility or illegality of performance by the
Lessor or the Lessee or both; (viii) any action of any Federal, state or local
governmental authority; or (ix) any other cause or occurrence whatsoever,
whether similar or dissimilar to the foregoing. The parties intend that the
obligations of the
6
Lessee hereunder shall continue unaffected unless such obligations shall have
been modified or terminated pursuant to an express provision of this Lease.
(b) The Lessee shall remain obliged under this Lease in accordance with
its terms and shall not take any action to terminate, rescind or avoid this
Lease, notwithstanding any bankruptcy, insolvency, reorganization, liquidation,
dissolution or other proceeding affecting the Lessor or any action with respect
to this Lease which may be taken by any trustee, receiver or liquidator or by
any court. Except as expressly permitted in this Lease, the Lessee waives all
rights to terminate or surrender this Lease, or to any abatement or deferment of
Fixed Rent, Additional Rent or other sums payable hereunder. The Lessee shall
remain obliged under this Lease in accordance with its terms, and the Lessee
hereby waives any and all rights now or hereafter conferred by Law or otherwise
to modify or to avoid strict compliance with its obligations under this Lease.
All payments made to the Lessor hereunder as required hereby shall be final, and
the Lessee shall not seek to recover any such payment or any part thereof for
any reason whatsoever, absent manifest error.
6. TAXES AND ASSESSMENTS; COMPLIANCE WITH LAW; CERTAIN AGREEMENTS. (a)
The Lessee shall pay or cause to be paid, subject to paragraph 18, all Charges
before any fine, penalty, interest or cost may be added or any default may be
claimed or any termination or foreclosure or forfeiture procedures for
nonpayment may be commenced. If any Property Charge may legally be paid in
installments, such Property Charge may be so paid in installments provided that,
if the Lessee has not paid the Offer Purchase Price and purchased the Property
pursuant to the terms hereof, the Lessee shall pay all such installments that
may be due from time to time (whether before or after the Expiration Date) on or
before the Expiration Date or earlier termination of this Lease.
(b) The Lessee shall comply, and cause the Property to comply, in all
material respects, with all Legal Requirements. "LEGAL REQUIREMENTS" means (i)
all Laws, foreseen or unforeseen, ordinary or extraordinary, or arising from
any restriction of record or otherwise, which now or at any time hereafter may
be applicable to the Lessor, as owner of the Improvements, the Parcels, the
Property or any part thereof, or any of the adjoining sidewalks, or the
ownership, construction, operation, mortgaging, occupancy, possessing, use,
non-use or condition of the Parcels, the Property or any part thereof and any
other governmental rules, orders and determinations now or hereafter enacted,
made or issued, and applicable to the Lessor, as owner of the Improvements, the
Parcels, the Property or any part thereof or the ownership, construction,
operation, mortgaging, occupancy, possession,
7
use, non-use or condition thereof whether or not presently contemplated; and
(ii) all agreements (including, without limitation, all Facility Agreements),
Permits, covenants, and restrictions applicable to the Parcels, the Property or
any part thereof or the ownership, construction, operation, mortgaging,
occupancy, possession, use, non-use or conditions thereof.
(c) The Lessee shall, and (unless a Default, Environmental Trigger,
Unwind Event or Event of Default has occurred and is continuing and Lessor has
revoked such authority) is hereby authorized by Lessor to, fully and promptly
keep, observe, perform and satisfy, on behalf of Lessor, any and all
obligations, conditions, covenants and restrictions of or on the Lessor under
any and all Facility Agreements so that there will be no default thereunder and
so that the other parties thereunder shall be and remain at all times obliged
to perform their obligations thereunder, and the Lessee, to the extent within
its control, shall not permit to exist any condition, event or fact that could
allow or serve as a basis or justification for any such Person to avoid such
performance.
7. MATTERS OF TITLE; ASSIGNABILITY. (a) The Lessee shall not create
or permit to be created or exist, and shall promptly remove and discharge, any
Lien upon this Lease, the Parcels or the Property or any part thereof or
interest therein, or upon any Fixed Rent, Additional Rent or other sum paid
hereunder, which Lien arises for any reason, including, without limitation, any
and all Liens which arise out of the ownership, use, condition, occupancy,
construction, possession, repair or rebuilding of the Property or any part
thereof (including, without limitation, by reason of construction and start-up
of the Improvements) or by reason of labor or materials furnished or claimed to
have been furnished to the Lessee or for the Property or any part thereof, but
excluding Permitted Encumbrances. Lessee's obligation to remove any of the
above-described Liens arising prior to the termination of this Lease (or
arising due to circumstances occurring prior to the termination of this Lease)
shall survive the termination of this Lease. Nothing contained in this Lease
shall be considered as constituting the consent or request of the Lessor,
express or implied, to or for the performance by any contractor, laborer,
materialman, or vendor of any labor or services or for the furnishing of any
materials for any construction, alteration, addition, repair or demolition of
or to the Property or any part thereof. NOTICE IS HEREBY GIVEN THAT THE LESSOR
IS NOT AND SHALL NOT BE LIABLE FOR ANY LABOR, SERVICES OR MATERIALS FURNISHED
OR TO BE FURNISHED TO THE LESSEE, OR TO ANYONE HOLDING OR POSSESSING THE
PROPERTY OR ANY PART THEREOF THROUGH OR UNDER THE LESSEE, AND THAT NO
MECHANIC'S OR OTHER SIMILAR STATUTORY LIENS FOR
8
ANY LABOR, SERVICES OR MATERIALS SHALL ATTACH TO OR AFFECT THE LESSOR'S
INTEREST OR ESTATE IN THE PROPERTY OR ANY PART THEREOF.
(b) The Lessor shall not create any Lien upon this Lease, the Parcels
or the Property or any part thereof except Permitted Encumbrances.
(c) Lessor agrees that Lessee during the Term shall have the exclusive
right (so long as no Environmental Trigger, Unwind Event or Event of Default
has occurred and is continuing and no Termination Notice has been delivered or
has been deemed to have been delivered) to secure subdivision approvals, site
plan approvals, annexation or de-annexation approvals, zoning variances and
Permits necessary or desirable for the development, use, operation, maintenance
or condition of the Property or any part thereof; PROVIDED that the fair market
value or use of the Property is not materially lessened by such action taken as
a whole with the actions referred to in paragraphs 9(a), 10(a) and 10(b)
hereof. Lessor agrees to execute such documents and take all other actions as
shall be reasonably necessary, and otherwise cooperate with Lessee, in
connection with the matters described above; PROVIDED, HOWEVER, that all costs
and expenses incurred by the Lessor in connection therewith shall be borne by
Lessee and that Lessor shall not be required to execute any documents which
would, in the reasonable opinion of the Agent, adversely affect the value or
use of the Property or otherwise adversely affect the transactions contemplated
by the Operative Documents or the interests of the Lessor or the Holders from
time to time of the Instruments.
8. [Intentionally Omitted].
9. MAINTENANCE, REPAIR AND PROPERTY RELOCATION. (a) The Lessee, at its
own cost and expense, will manage and maintain the Property in good mechanical
condition and repair, in accordance with prudent industry practice and in a
manner consistent with that of other similar properties owned or operated by it
or its Affiliates, and will take all action, and will make all changes and
repairs, structural and nonstructural, foreseen and unforeseen, ordinary and
extraordinary, which may be required to maintain the Property in good
mechanical condition and repair, in accordance with prudent industry practice,
or which may be required pursuant to any Legal Requirement or Insurance
Requirement at any time in effect. Lessee shall, in accordance with prudent
industry practice, repair or replace each item constituting the Improvements
that shall have become worn out, damaged, inoperative or obsolete in whole or
in part; PROVIDED, HOWEVER, that (i) the fair market value or use of the
Property shall not be materially lessened by such replacements and
9
repairs taken as a whole with the actions referred to in paragraphs 7(c), 10(a)
and 10(b) hereof, and (ii) such replacements shall be of a type suitable for
use in the industry for the same purpose and having a useful life at least as
long as that of the Improvements (or any part thereof) repaired or replaced
(prior to obsolescence, loss or damage and the like). All repairs,
replacements and rebuilding by the Lessee hereunder, to the extent permitted by
Law, shall immediately become and shall remain part of the Property of the
Lessor, subject to this Lease. The Lessor shall not be required to, and Lessee
hereby waives any right to require the Lessor to, manage, maintain, replace,
repair or rebuild the Property or any part thereof and the Lessee waives any
and all rights it may now or hereafter have to make any repairs at the cost and
expense of the Lessor pursuant to any Legal Requirement, Insurance Requirement,
or otherwise, at any time in effect.
(b) Except for Permitted Encumbrances, in the event that all or any
part of the Improvements shall encroach upon any property or right-of-way
adjoining or adjacent to either of the Parcels or any part thereof, or shall
violate any agreements or conditions affecting the Parcels or the Property or
any part thereof, or shall obstruct any easement or right-of-way to which the
Parcels or the Property or any part thereof may be subject, then the Lessee
shall, at its sole cost and expense, either (i) contest such matter pursuant to
paragraph 18 hereof, (ii) obtain valid and effective Permits for or consents to
such encroachments and/or violations (without any liability to Lessor, the
Agent or the Holders of the Instruments for which such parties are not
indemnified by the Lessee) or waivers or settlements of all claims, liabilities
and damages resulting therefrom, or (iii) make such changes, including
alteration or removal, to the Improvements and take such other action as shall
be reasonably necessary to rectify such encroachments, violations, hindrances,
obstructions or impairments, subject to the Lessor's consent if and to the
extent required by paragraph 10(a) hereof.
(c) The Lessee shall give the Lessor and the Agent prompt notice of
any scheduled maintenance or reconditioning or any other activity which
requires shutdown of operations of the Lessee's stearates, lubricants and
stabilizers production facilities (i) to be located on the Parcels or (ii)
which comprise any of the Improvements for a period of time in excess of an
aggregate of ten (10) Business Days in any thirty-day period and shall state
the specific reasons for such shutdown.
10. ADDITIONAL IMPROVEMENTS; REMOVAL. (a) At any time, so long as no
Default, Unwind Event, Environmental
10
Trigger or Event of Default shall have occurred and be continuing and no
Termination Notice has been delivered or has been deemed to have been
delivered, the Lessee may, at its own cost and expense, make Additional
Improvements to the Property or any part thereof; PROVIDED, HOWEVER, that (i)
the fair market value of the Property shall not be materially lessened by such
Additional Improvements taken as a whole; (ii) such Additional Improvements
taken as a whole with the actions referred to in paragraphs 7(c), 9(a) and
10(b) hereof shall not materially diminish the capacity, efficiency or useful
life of the Improvements; and (iii) such work shall be completed in a good and
workmanlike manner free and clear of any Liens for labor, services or materials
(other than Permitted Encumbrances) and in compliance with all applicable Legal
Requirements and Insurance Requirements. "ADDITIONAL IMPROVEMENTS" means
additions to, alterations of or replacements for the Improvements or any part
thereof (other than in connection with the completion of construction of the
Improvements contemplated by the Construction Plans as of the date hereof) made
by or for the Lessee, excluding any replacements installed as part of scheduled
maintenance procedures.
(b) The Lessee shall be permitted at any time during, or upon the
expiration or termination of, the Term, and at its sole cost and expense, to
remove or demolish any portion or part of the Additional Improvements in
accordance with prudent industry practices; PROVIDED, HOWEVER, that, such
removal taken as a whole with the actions referred to in paragraphs 7(c), 9(a)
and 10(a) hereof shall not (i) materially impair the intended use or reduce the
fair market value of the Property or either Plant below its fair market value
at the commencement of the Primary Term; (ii) materially diminish the capacity,
efficiency or useful life of the Improvements or either Plant below the
capacity, efficiency or useful life as of the commencement of the Primary Term;
or (iii) cause a violation of any Legal Requirement or Insurance Requirement or
significantly increase any risk of liability under any Environmental Law or any
risk to human health or the environment. Any damage to the Property or any
part thereof caused by such removal shall promptly be repaired by the Lessee
and the Property or any part thereof shall be restored to its condition (or the
reasonable equivalent thereof) as it existed immediately prior to the
construction of such removed Additional Improvements, at the Lessee's sole cost
and expense. The Lessee may place upon the Property or any part thereof any
inventory, fixtures, machinery, equipment or other property belonging to the
Lessee or third parties and remove the same at any time during the Term and
Lessee may, and at the request of the Lessor shall, remove the same at the
expiration or termination hereof unless the Lessee shall have paid the Offer
Purchase Price and
11
purchased the Property pursuant to the terms of this Lease; PROVIDED that any
damage to the Property or any part thereof caused by such removal shall
promptly be repaired by the Lessee, and the Property or such part thereof
restored to its condition (or the reasonable equivalent thereof) as it existed
immediately prior to the placement of any such property upon the Parcels,
all at the Lessee's sole cost and expense.
(c) The Lessee shall notify the Lessor of any Additional Improvements,
the cost of which is anticipated to exceed in the aggregate $1 million in any
calendar year with respect to the Property, which notice shall include a
reasonably detailed description of the work that will be done. All Additional
Improvements shall become and remain Property of the Lessor and shall be
subject to this Lease, unless and until removed by the Lessee in accordance
with subparagraph 10(b).
11. LESSEE'S RIGHT TO CONTEST REAL PROPERTY TAXES. The Lessee, at its
own cost and expense and in compliance with paragraph 18, shall have the sole
right, at any time, to seek, in good faith, a reduction in the assessed
valuation of the Property or any part thereof or to contest, in good faith, any
real or personal property taxes for the Property or the Additional
Improvements, or any part thereof. Lessor shall not be required to join in any
proceeding or contest brought by Lessee unless the provisions of any Legal
Requirement require that the proceeding or contest be brought by or in the name
of the owner of the Property. In that case Lessor shall join in the proceeding
or contest or permit it to be brought in Lessor's name as long as Lessee
reimburses the Lessor for any and all costs and expenses incurred by Lessor in
connection therewith. Lessee, on a final non-appealable determination of the
proceeding or contest, shall immediately pay, discharge and satisfy any
decision or judgment rendered, together with all costs, interest and penalties
incidental to the decision or judgment.
12. CONDEMNATION AND CASUALTY. (a) GENERAL. The Lessee hereby
irrevocably assigns to the Trustee, on behalf of the Lessor, any award or
compensation or insurance payment or other proceeds to which the Lessee may
become entitled by reason of its interest in the Property or any part thereof
if (i) either of the Parcels, the Improvements or the Property or any part
thereof is damaged or destroyed by fire or other casualty for which the amount
of loss exceeds $25,000 (each, a "CASUALTY") or (ii) the use, occupancy or
title of the Parcels or the Improvements or any part thereof is taken or
requisitioned or sold in, or on account of any actual or threatened
condemnation or eminent domain proceedings, or other action by any Person
having the power of eminent domain (each, a "CONDEMNATION").
12
The Lessee shall promptly notify the Lessor in writing of any such
Casualty or Condemnation and shall appear in any proceeding or action to
defend, negotiate, prosecute or adjust any claim for any award or compensation
or insurance payment on account of any Casualty or Condemnation and shall take
all appropriate action in connection with any Casualty or Condemnation,
including the employment of counsel reasonably satisfactory to the Lessor. The
Lessor shall have the right to appear and participate and to employ counsel in
any such proceeding or action, and the fees and expenses of such counsel shall
be paid by the Lessee. If the Lessee shall elect not to appear or shall fail
to prosecute diligently, the Lessor may assume the prosecution thereof and the
Lessee shall pay all of the costs and expenses of the Lessor (including, but
not limited to, fees and expenses of Lessor's counsel) and the fees and
expenses of the Special Counsel. No settlement of any such proceeding or
action shall be made by the Lessee or the Lessor without the written consent of
the other party hereto, which consent shall not unreasonably be withheld or
delayed.
Any and all amounts representing proceeds paid in connection with any
such Condemnation or Casualty, as the case may be (collectively, the
"PROCEEDS"), shall be paid over to the Proceeds Trustee (as defined below) to
be held in trust by such Proceeds Trustee and distributed pursuant to this
paragraph 12 and paragraph 15 hereof or pursuant to the Declaration of Trust,
as appropriate (all such Proceeds, less the costs and expenses incurred by the
Lessor and the Lessee in collecting such amounts, but including any
reimbursement by the Lessee for costs and expenses in connection therewith to
which the Lessor, the Trustee and the Purchasers are entitled pursuant to this
Lease, are the "NET PROCEEDS"). Any and all Proceeds received by the Lessee in
connection with any such proceeding or action shall be received by the Trustee
and held in trust for the benefit of the Trustee, shall be segregated from
other funds of the Trustee and shall be forthwith paid over to the Proceeds
Trustee. The Lessee agrees that this Lease shall control the rights of the
Lessor and the Lessee in any such Proceeds, and any present or future Law to
the contrary is hereby waived. Any and all reasonable charges, fees and
expenses of the Proceeds Trustee shall be paid from the Net Proceeds. "PROCEEDS
TRUSTEE" shall mean SSBTC or such title company or other independent bank or
trust company as may be designated by the Lessor.
(b) CONDEMNATION OR CASUALTY WITH TERMINATION.
(i) If a Casualty or a Condemnation shall in the
good faith opinion of an Officer of Lessee affect the Property
in such manner as to render it unsuitable for restoration or for
continued use, in whole, or in part
13
and occupancy by the Lessee for the intended purposes thereof,
then the Lessee may deliver to the Lessor, not later than thirty
(30) days after such occurrence a written notice (herein called
a "TERMINATION NOTICE") describing the event giving rise to such
termination and describing the status of any proceeding or
action and the amount of any Proceeds received or expected to be
received in connection therewith, together with the date,
or estimated date, of such receipt.
(ii) If a Casualty or Condemnation occurs during the
Primary Term and the Lessor has received an opinion, which
shall be at the Lessee's sole cost and expense, of the
Independent Engineer to the effect that the restoration of the
Property could not be expected to restore and rebuild the
Property to its previous capacity, efficiency and useful life or
such restoration and rebuilding could not be expected to be
completed in full prior to the Expiration Date (or completed in
full prior to the Interim Note Maturity Date, in the case of a
Casualty or Condemnation during the Construction Period) or that
the cost of such restoration or rebuilding would exceed 25% of
the fair market value of the Property immediately prior to such
Casualty or Condemnation, then the Lessor may, in its sole
discretion, deliver a notice ("LESSOR TERMINATION NOTICE")
declaring Lessor's intention to terminate this Lease and the
Lessee shall be deemed to have delivered a Termination Notice
with respect to the Property to the Lessor as of the date of the
Lessor Termination Notice.
(iii) Simultaneous with the delivery of a Termination
Notice pursuant to (i) above (or a deemed delivery of a
Termination Notice pursuant to (ii) above), the Lessee shall
deliver (or shall be deemed to have delivered in the case of
(ii) above) to the Lessor an Offer to Purchase in accordance
with paragraphs 14 and 15.
(c) CONDEMNATION OR CASUALTY WITHOUT TERMINATION.
If, after a Casualty or Condemnation, the Lessee has not given a Termination
Notice and the Lessor has not given a Lessor Termination Notice in accordance
with subparagraph 12(b), then this Lease shall continue in full force and
effect, and the Lessee shall, at its sole cost and expense, promptly commence
and diligently pursue to completion the rebuilding, replacement or repair of
any damage to the Property caused by such event in conformity with the
requirements of paragraph 9 or 10, as applicable, in order to restore the
Property (in the case of a Condemnation, as nearly as practicable) to the value
and operating condition thereof immediately prior to such event. In connection
with such restoration the Lessee shall, before beginning such restoration,
submit plans and
14
specifications for such restoration, together with an estimate of the cost
thereof, and all necessary construction contracts therefor for the Lessor's and
the Independent Engineer's approval, which will not be unreasonably withheld;
PROVIDED that (i) the capacity, efficiency and useful life of the Improvements,
shall not, after all such restoration taken as a whole, be materially less than
the capacity, efficiency and useful life prior to such Casualty or
Condemnation; (ii) the fair market value of the Property shall not, after all
such restoration taken as a whole, be materially less than its fair market
value prior to such Casualty or Condemnation; and (iii) if the estimated cost
to complete such restoration exceeds the amount of Net Proceeds, the Lessor is,
in its sole judgment, satisfied that the Lessee shall have sufficient funds
(the "EXCESS FUNDS") available to pay such excess, which Excess Funds if in
excess of $25,000, shall be deposited by the Lessee with the Proceeds Trustee
and distributed to the Lessee as hereinafter provided. Such work shall be
completed in a good and workmanlike manner free and clear of all Liens for
labor, services or materials and in compliance with all applicable Legal
Requirements and Insurance Requirements. All fees and expenses of the
Independent Engineer in connection with any rebuilding and restoration shall be
at the Lessee's sole cost and expense.
The Lessee shall be entitled to receive payment from the Net Proceeds
or the Excess Funds, as the case may be, from time to time as such work of
rebuilding, replacement or repair progresses, but only after presentation of
certificates of the Independent Engineer, delivered by the Lessee to the
Proceeds Trustee (with a copy to the Lessor) from time to time as such work of
rebuilding, replacement or repair progresses. Each such certificate of the
Independent Engineer shall describe the work for which the Lessee is requesting
permission to pay or requesting payment and the cost incurred by the Lessee in
connection therewith and shall state that such work has been properly completed
and that the Lessee has not theretofore received payment for such work, and
shall be accompanied by (i) an Officer's Certificate of the Lessee certifying
that no Default, Environmental Trigger, Unwind Event or Event of Default has
occurred and is continuing and that the Net Proceeds and Excess Funds held by
the Proceeds Trustee are adequate to complete such rebuilding, replacement or
repair in accordance with this paragraph 12(c), and (ii) duly executed Lien
waivers executed by each materialman or mechanic furnishing materials or labor
for which the Lessee is requesting permission to pay. The Proceeds Trustee
shall deliver, or cause to be delivered, payment within ten (10) days after its
receipt of the certificates required above. In connection with such payments,
the Proceeds Trustee shall first apply the Excess Funds to the cost of such
restoration prior to the disbursement of any Net Proceeds by the Proceeds
15
Trustee for such purpose. Upon receipt by the Proceeds Trustee (with a copy to
the Lessor) of an Officer's Certificate from the Lessee, to the effect that
final payment has been made for any such work and stating that the rebuilding,
replacement or repair has been completed in compliance with the terms and
conditions of this Lease, the remaining amount of such Net Proceeds shall be
paid to the Lessee. The Lessee shall be responsible for the cost of any such
repair, rebuilding or restoration in excess of such Net Proceeds and Excess
Funds, for which cost the Lessee shall make adequate provision acceptable
to the Lessor.
(d) TEMPORARY CONDEMNATION OR LEASE TERMINATION. Notwithstanding any
provision to the contrary contained in this paragraph 12, in the event of any
temporary Condemnation this Lease shall remain in full force and effect, and
provided no Default or Event of Default, Unwind Event or Environmental Trigger
has occurred and is continuing, the Lessee shall be entitled to receive the Net
Proceeds allocable to such temporary Condemnation, except that if this Lease
shall expire or terminate during such temporary Condemnation, then Lessee shall
be entitled to the Net Proceeds allocable to the period after the termination
or expiration of this Lease only if it has paid the Offer Purchase Price for
the Property.
13. ENVIRONMENTAL EVENT. (a) Except for the matters referenced in
the Disclosed Information, the Lessee shall promptly, but in any case within
five (5) Business Days, notify the Lessor, the Agent and the Purchasers if (i)
any environmental event has occurred or any environmental condition is
discovered in, on, beneath, from or involving the Property or any part thereof
(including, but not limited to, the presence, emission or release of Hazardous
Materials or the violation of any applicable Environmental Law) that could
reasonably be anticipated to result in penalties or other liabilities in excess
of $125,000, or (ii) the Lessee has received notification that it, the Property
or any part thereof is the subject of an Environmental Action that could
reasonably be expected to result in any ordered remediation or corrective
action or other liability related to an environmental event or condition the
cost of which liability is reasonably expected to exceed $125,000 (each of (i)
and (ii) an "ENVIRONMENTAL EVENT").
(b) Following the receipt of a notice pursuant to (a) above, the
Lessor, the Agent, the Holders of the B-Notes and the Certificate Holders,
shall discuss with Lessee the Lessee's anticipated response to such
Environmental Event and, in each case in their sole discretion, may require the
Lessee to conduct, or cause to be conducted, an environmental audit of the
Property, the scope of which audit shall be limited to confirming the magnitude
and anticipated cost of the liability
16
resulting in the Environmental Event and to provide a copy of the Environmental
Consultant's report on its audit to the Lessor, the Agent, the Trustee and the
Purchasers. Notwithstanding the foregoing, if a pattern, in the opinion of the
Lessor and the Holders of the B-Notes and Certificates, of such Environmental
Events exists, the Lessor may conduct a more comprehensive environmental audit
of the Property to determine the scope and nature of such pattern and its
effect on the Property. If it is the opinion of the Agent and the
Environmental Consultant that an Environmental Event has occurred or exists and
a Permitted Remediation is not available or the Environmental Event cannot be
cured through a Permitted Remediation or the Environmental Event will result in
the cessation of operation of the Improvements for 90 days or more (each an
"ENVIRONMENTAL TRIGGER"), the Lessor, the Agent and the Purchasers shall have
the option, each in its sole discretion, to require the Lessee to purchase the
Property for the Offer Purchase Price in the manner provided in paragraphs 14
and 15 hereof. A "PERMITTED REMEDIATION" means any remediation of an
Environmental Event (a) the cost of which remediation is not anticipated, in
the sole opinion of the Agent and the Environmental Consultant (the cost and
expense of which Environmental Consultant shall be borne by the Lessee), to
exceed $750,000, (b) during and after which such Environmental Event could not
be expected to result in any additional environmental liability incurred by
Lessor for which Lessor, the Agent and the Purchasers have not received
additional indemnification in an amount and from a Person satisfactory to the
Lessor, the Agent and the Holders of the B-Notes and the Certificates in their
sole and absolute discretion and (c) permitted and effected in compliance with
all applicable Environmental Laws.
(c) Irrespective of whether an Environmental Trigger has occurred,
Lessee shall immediately initiate, at its sole cost and expense, such actions
as may be necessary to comply in all material respects with all applicable
Environmental Laws. Once Lessee commences such actions, Lessee shall
thereafter diligently and expeditiously proceed to comply materially and in a
timely manner with all Environmental Laws and shall, at the request of the
Lessor or the Agent during the Term, give periodic progress reports on its
compliance efforts and actions.
14. OFFER TO PURCHASE. (a) At any time during the Term but prior to
exercising its options pursuant to paragraph 27(a) hereof, Lessee may (unless
otherwise required to do so, in which case it shall) deliver to Lessor and the
Agent a written offer to purchase the Property in its entirety (an "OFFER TO
PURCHASE") upon and subject to the applicable terms of this Lease.
17
(b) Any Offer to Purchase delivered or deemed to be delivered by the
Lessee hereunder shall, notwithstanding anything to the contrary set forth
therein, be irrevocable and unconditional and shall set forth the Termination
Value to be paid by Lessee.
(c) The Lessor shall be deemed to have accepted such Offer to Purchase
the Property on the date Lessor receives the same. The procedure for the
purchase of the Property and the purchase price therefor shall be governed by
paragraph 15 hereof.
(d) In addition, within five (5) days after the occurrence of an
Unwind Event, Lessee may cause an Offer to Purchase to be delivered by Lessee's
designee to Lessor and Agent.
14A. PARTIAL LEASE TERMINATION. (a) At any time during the
Construction Period but prior to exercising its options pursuant to paragraph
27(a) hereof, Lessee may deliver to Lessor and the Agent a written offer to
purchase a portion of the Assets as to which the Lessee has made a good faith
determination that such portion of the Assets are no longer used or useful in
the business of the Lessee conducted at the Property and a certification that
the Lessee will abandon such portion of the Assets or sell the same to a third
party (a "PARTIAL LEASE TERMINATION") upon and subject to the applicable terms
of this Lease.
(b) Any Partial Lease Termination delivered or deemed to be delivered
by the Lessee hereunder shall, notwithstanding anything to the contrary set
forth therein, be irrevocable and unconditional and shall set forth the pro
rata portion of the Termination Value (the "ALLOCATED TERMINATION VALUE") to be
paid by Lessee. If the portion of the Assets which are the subject of a
Partial Lease Termination (the "ALLOCATED ASSETS") are within a category of
equipment which has not been separately valued, a new appraisal will be
obtained by the Lessee at Lessee's sole expense to determine the Allocated
Termination Value.
(c) The Lessor shall be deemed to have accepted such Partial Lease
Termination on the date Lessor receives the same. Notwithstanding any
provisions of this paragraph to the contrary, no Partial Lease Termination
shall be permitted if, taking into account all previous Partial Lease
Terminations, the aggregate amount of all Allocated Termination Value payments
made or due to be made exceeds 25% of the Total Commitment or (ii) the Partial
Lease Termination would result in a material reduction in the value of the
remaining Property or prevent the Lessee from complying with the conditions set
forth in Section 7.05(b) of the Participation Agreement.
18
(d) The date of the closing of any purchase by the Lessee of the
Allocated Assets (the "PARTIAL LEASE TERMINATION CLOSING DATE") shall be on the
next scheduled Payment Date following the date of Lessor's acceptance or deemed
acceptance of any Partial Lease Termination. On the Partial Lease Termination
Closing Date, upon receipt by the Lessor of the Allocated Termination Value,
the Lessor shall convey, or cause to be conveyed, the Allocated Assets to the
Lessee or its designee by an appropriate ▇▇▇▇ of sale containing no
representation or warranty (expressed or implied) except that the Allocated
Assets are free and clear of any conveyance, mortgage, lease or Lien or other
adverse interest of any kind created or caused by the Lessor or any person
claiming by, through or under the Lessor (except Permitted Encumbrances other
than those described in clause (v) of the definition thereof) and as consented
to or created or caused by the Lessee.
(e) On the Partial Lease Termination Closing Date, the Lessee shall
pay, or cause to be paid, to the Lessor for deposit to the Reinvestment Account
established pursuant to the Declaration, the Allocated Termination Value, as
specified in the Partial Lease Termination related thereto, and all Fixed Rent,
Additional Rent and other sums then due and payable hereunder up to and
including such Partial Lease Termination Closing Date (such amounts, plus all
Closing Costs, are herein referred to as the "PARTIAL LEASE TERMINATION
PRICE"), and the Lessor shall simultaneously (i) deliver to the Lessee or its
designee the instruments referred to in paragraph 14(d) above with respect to
the Allocated Assets and any other instruments reasonably necessary to assign
and convey to the Lessee or its designee the Allocated Assets and any other
related property then required to be assigned pursuant hereto.
15. PROCEDURE UPON PURCHASE. (a) The date of the closing of the
Lessee's purchase of the Property (the "CLOSING DATE") shall be (i) on the
Expiration Date pursuant to paragraph 27 hereof or (ii) if the Lessee shall
deliver (or shall be deemed to have delivered) an Offer to Purchase pursuant to
paragraph 14(a) hereof, on the next scheduled Payment Date following the date
of Lessor's acceptance or deemed acceptance of such Offer to Purchase, (iii) if
the Lessee shall deliver (or be deemed to have delivered) an Offer to Purchase
pursuant to paragraphs 12(b), 13(b) or 18A hereof, on the fifteenth day
following the date of Lessor's acceptance or deemed acceptance of such Offer to
Purchase, or (iv) if the Lessee shall deliver (or be deemed to have delivered)
an Offer to Purchase pursuant to paragraphs 14(d) or 19(h), on the fifth
Business Day following the date of Lessor's acceptance or deemed acceptance of
such Offer to Purchase. On the Closing Date, upon receipt by the Lessor of the
Offer Purchase
19
Price, the Lessor shall convey, or cause to be conveyed, the Property (or, in
the case of Casualty or Condemnation, the remaining portion thereof) to the
Lessee or its designee by an appropriate recordable deed and ▇▇▇▇ of sale to
the Property and Improvements, in each case containing no representation or
warranty (expressed or implied) except that the Property is free and clear of
any conveyance, mortgage, lease or Lien or other adverse interest of any kind
created or caused by the Lessor or any person claiming by, through or under the
Lessor (except Permitted Encumbrances and as consented to or created or caused
by the Lessee and except as to any interest created by the Lessor upon the
exercise of any right hereunder upon any Event of Default).
(b) On the Closing Date, the Lessee shall pay, or cause to be paid, to
the Lessor the Termination Value for the Property, as specified in the Offer to
Purchase related thereto, and all Fixed Rent, Additional Rent and other sums
then due and payable hereunder relating to the Property up to and including
such Closing Date (such amounts, plus all Closing Costs, are herein referred to
as the "OFFER PURCHASE PRICE"), and the Lessor shall simultaneously (i) deliver
to the Lessee or its designee the instruments referred to in paragraph 15(a)
above with respect to the Property and any other instruments reasonably
necessary to assign and convey to the Lessee or its designee the Property and
assign all Facility Agreements related to the Property (other than any rights
of the Lessor to any indemnities thereunder) and any other related property
then required to be assigned pursuant hereto, and (ii) convey, or cause to be
conveyed, to the Lessee or its designee any Net Proceeds related to the
Property and/or the right to receive the same.
(c) Upon the completion of any purchase of the Property in its
entirety pursuant to this paragraph 15, but not prior thereto, this Lease shall
terminate except with respect to obligations and liabilities of the Lessee
actual or contingent which have arisen with respect to the Property on or prior
to such date of purchase, and except as elsewhere expressly provided herein.
16. INSURANCE. (a) The Lessee will purchase and maintain, or cause
to be purchased and maintained, insurance with respect to the Property of the
following types and in the following amounts (or in such greater amounts as may
become necessary from time to time to prevent the Lessor, the Lessee, the Agent
and the Holders from time to time of the Instruments from becoming co-insurers
of any loss), and in no event in amounts less than those maintained by the
Lessee or its Affiliates for other similar facilities or property owned and/or
operated by them:
20
(i) PROPERTY INSURANCE: Insurance against physical
damage to the Property (with sublimits and deductibles as are
acceptable to Lessor and with a maximum self-insured retention
allowable of $100,000) caused by perils now or hereafter
embraced by or defined in a manuscript "all risks" insurance
policy, including flood, earth movement, earthquake, subsidence
and collapse, business interruption/extra expense and boiler and
machinery coverage;
(ii) BUILDER'S RISK INSURANCE: During the
Construction Period and during the construction of any
Additional Improvements, builder's "all risks" and "general
risks" insurance (with sublimits and deductibles as are
acceptable to Lessor), including flood, earth movement,
earthquake, subsidence and collapse, business interruption/extra
expense and boiler and machinery coverage with respect to the
Property and any on-site and off-site work and materials related
thereto protecting the Lessee, the Lessor and all contractors
and subcontractors, in an amount not less than the full
replacement cost of the Property and such on-site and off-site
work;
(iii) GENERAL LIABILITY INSURANCE: Comprehensive
general liability (including contractual, completed operations
and product liability) insurance against claims for bodily
injury (including death), personal injury and property damage
occurring on, in or in respect of the Property or resulting from
activities on or related to the Property, in the minimum
combined single limit amount of $25,000,000 in the annual
aggregate and $25,000,000, for each occurrence for bodily injury
(or death) and/or property damage with a maximum self-insured
retention allowable of $250,000;
(iv) WORKERS' COMPENSATION INSURANCE: Workers'
compensation insurance at statutory levels and employers'
liability insurance, with a limit of $1,000,000, in the
aggregate; and
(v) OTHER INSURANCE: Such other insurance,
including automobile liability, in such amounts and against such
risks, as is either (x) customarily carried by companies owning,
operating or leasing property or conducting businesses
similar and/or similarly situated to the Property and/or the
Lessee, or (y) reasonably requested from time to time by Lessor.
Such insurance shall be written by companies that are nationally
recognized (including Lloyd's of London or other recognized international
insurers with an ISI rating of
21
not less than BBB); primary insurance shall be written by companies rated at
least AXI in the most recent edition of Best's Key Rating Guide, or as
otherwise agreed to by the Agent, the Lessor, the Note Holders and the
Certificate Holders, selected by the Lessee and, other than the insurance
specified in paragraph 16(a)(i), (ii) and (iv), shall name Lessor, SSBTC (in
its individual capacity and as Trustee) and the Agent, on its own behalf and on
behalf of the Holders from time to time of the Instruments and their assignees,
as additional insureds, as their interests may appear. Notwithstanding the
foregoing, insurance coverage shall continue to be based on market conditions,
capacity and costs and in no event will the Lessee be required to maintain
coverage in amounts in excess of those maintained for businesses similar in
size, nature and creditworthiness to the Lessee under prevailing market
conditions.
(b) The insurance referred to in paragraph 16(a)(i) and (ii) for the
Property may be a blanket policy and shall (i) at all times be in an amount at
least equal to the greater of (x) one hundred percent (100%) of the full
replacement cost value (without depreciation) of the Property and the Lessee's
leasehold improvements and (y) Termination Value; (ii) include a lenders' loss
payable endorsement in favor of the Lessor and any loss or damage under such
insurance policies shall be payable solely to the Trustee on behalf of the
Lessor, as Lessor's interest may appear, to be held and applied pursuant to the
terms of this Lease; (iii) provide that the interests of the Lessor, the
Trustee, the Agent and the Holders from time to time of the Instruments shall
be insured regardless of any breach or violation by the Lessee of any
warranties, declarations or conditions contained in such insurance; (iv)
provide that such insurance shall not be invalidated by any act, omission or
negligence of the Lessee, the Lessor, the Trustee, the Agent or the Holders
from time to time of the Instruments, nor by any foreclosure or other
proceedings or notices thereof relating to the Property or any part thereof,
nor by legal title to, or ownership of the Property or any part thereof
becoming vested in or by Lessor or its agents, nor by occupancy or use of the
Property or any part thereof for purposes more hazardous than permitted by
such policy; and (v) provide that all insurance claims pertaining to the
Property or any part thereof shall be adjusted by the insurers thereunder with
the Lessee but that the Lessor must consent to any such adjusted claim.
All policies of insurance required to be maintained pursuant to
paragraph 16(a)(iii) which cover liability for bodily injury or property damage
shall provide that all provisions of such insurance, except the limits of
liability (which shall be applicable to all insureds as a group) and liability
premiums (which shall be solely a liability of the
22
Lessee), shall operate in the same manner as if there were a separate policy
covering each such insured and/or additional insured, without right of
contribution from any other insurance which may be carried by an insured
and/or additional insured.
Every policy required under paragraph 16(a) shall (i) expressly provide
that it will not be canceled or terminated except upon 60 days' written notice
to the Lessor and the Lessee, except in the case of cancellation or termination
due to a lapse for non-payment, in which case only 30 days' written notice
shall be required; (ii) include a waiver of all rights of subrogation against
the Lessor, the Trustee, the Agent and the Holders from time to time of the
Instruments and any recourse against the Lessor, the Trustee, the Agent or the
Holders from time to time of the Instruments for payment of any premiums or
assessments under any policy; and (iii) not contain a provision relieving the
insurer thereunder of liability for any loss by reason of the existence of
other policies of insurance covering the Property or any part thereof against
the peril involved, whether collectible or not, if such other policies do not
name the Lessor, the Trustee, the Agent and the Holders from time to time of
the Instruments as additional insureds with loss payable as provided in the
Lease. The Lessee shall advise the Lessor promptly of any policy cancellation
or any change adversely affecting the coverage provided thereby.
(c) The Lessee shall deliver to the Lessor the certificates of
insurance and any other documentation required by the Lessor evidencing the
existence of all insurance which is required to be maintained by the Lessee
hereunder including descriptions of the previously mentioned Insurance
Requirements, such delivery to be made (i) as provided in Section 2.01(k) of
the Participation Agreement, (ii) within twenty-one (21) days of the issuance
of any additional policies or amendments or supplements to any of such
insurance, and (iii) at least twenty-one (21) days prior to the expiration date
of any such insurance. The Lessee shall notify Lessor and Agent of any
nonrenewal of any policy required hereunder and shall cause each insurer under
each policy required hereunder to give the Lessor notice of any lapse under any
such policy. The Lessee shall not obtain or carry separate insurance
concurrent in form, or contributing in the event of loss, with that required by
this paragraph 16 unless the Lessor, the Trustee, the Agent and the Holders
from time to time of the Instruments are named as additional insureds therein,
with loss payable as provided in this Lease. The Lessee shall immediately
notify the Lessor, the Trustee, the Agent and the Holders from time to time of
the Instruments whenever any such separate insurance is obtained and shall
deliver to the Lessor the certificates of insurance and any
23
other documentation (other than blanket policies) required by Lessor evidencing
the same as is required hereunder.
(d) The requirements of subparagraphs (a) through (c) of this
paragraph 16 shall not be construed to negate or modify the Lessee's
obligations under Section 9.15 of the Participation Agreement.
17. SUBLETTING. (a) The Lessee shall not sublet the Property or any
part thereof, unless (i) at the time of any such sublease, no Default,
Environmental Event, Unwind Event or Event of Default shall have occurred and
be continuing and no Termination Notice has been delivered or has been deemed
to have been delivered; (ii) any such sublease shall by its terms be expressly
made subject and subordinate to the terms of this Lease and shall expire on or
before the last day of the Lease Term; (iii) the Lessee shall provide the
Lessor sixty (60) days prior to the effective date of such sublease with notice
of such sublease; (iv) the Lessee shall provide the Lessor ten (10) Business
Days prior to the effective date of such sublease with a conformed copy of the
instrument creating such sublease; (v) the Lessor has consented to such
sublease such consent not to be unreasonably withheld; and (vi) the Final
Completion Date shall have occurred.
(b) No sublease pursuant to this paragraph 17 shall modify or limit
any right or power of the Lessor hereunder or affect or reduce any obligation
of the Lessee hereunder, and all such obligations of the Lessee shall continue
in full force and effect as obligations of a principal and not of a guarantor
or surety, as though no subletting had been made or occupancy permitted.
(c) If the Lessee shall request, in connection with any sublease, that
the Lessor execute an attornment and non-disturbance agreement with respect to
such sublease, the Lessor shall consider each such sublease on a case-by-case
basis and may give its consent to its execution and delivery of an attornment
and non-disturbance agreement. The Lessee shall not mortgage, pledge or
otherwise encumber its interest in and to this Lease or in and to any sublease
or the rentals payable thereunder without the prior written consent of the
Lessor. Any sublease made, and any mortgage, pledge or assignment of the
Lessee's interest hereunder or under any such sublease granted, otherwise than
as expressly permitted by this paragraph 17, shall be null and void and of no
force or effect.
18. PERMITTED CONTESTS. (a) So long as (w) no Unwind Event,
Environmental Trigger or Event of Default has occurred, (x) no Termination
Notice has been delivered or been
24
deemed to have been delivered, (y) the Lessee shall not have notified the
Lessor pursuant to paragraph 27(a)(ii) that it is terminating this Lease and
abandoning the Property or (z) the Lessee shall not have otherwise surrendered
or be required to surrender the Property to the Lessor for any reason
(including, without limitation, pursuant to paragraph 23(a)), the Lessee shall
not be required, nor shall the Lessor have the right, to pay, discharge or
remove any Charges or to comply or cause the Property or any part thereof to
comply with any applicable Legal Requirement or to pay any materialman's,
laborer's or undischarged or unremoved Lien, as long as the Lessee shall at its
sole cost and expense contest, or cause to be contested, diligently and in good
faith, the existence, amount or validity thereof by appropriate proceedings,
which shall (i) in the case of an unpaid Property Charge or undischarged or
unremoved Lien, prevent the collection thereof from the Lessor or against the
Property or any part thereof, (ii) prevent the sale, forfeiture or loss of the
Property or any part thereof, and (iii) in the case of a Legal Requirement, not
subject the Lessor, the Agent, the Trustee or the Holders from time to time of
the Instruments to the risk of (x) any criminal liability or (y) any civil
liability which in the judgment of the Agent is not adequately indemnified for
failure to comply therewith. The Lessee shall give such assurances as may be
reasonably demanded by the Lessor to insure ultimate payment of such Charges or
the discharge or removal of any such materialman's, laborer's or mechanic's
Lien or to insure compliance with such Legal Requirement and to prevent any
sale or forfeiture of the Property or any part thereof, or any interference
with or deductions from any Fixed Rent, Additional Rent or any other sum
required to be paid by the Lessee hereunder by reason of such non-payment,
non-discharge, non-removal or non-compliance.
(b) The Lessor shall cooperate with the Lessee in any contest and
shall allow the Lessee to conduct such contest (in the name of the Lessor, if
necessary) at the Lessee's sole cost and expense. The Lessee shall notify the
Lessor of each such proceeding at least ten days prior to the commencement
thereof, which notice shall describe such proceeding in reasonable detail.
(c) The Lessee shall, promptly after the final determination
(including appeals) of any contest brought by it pursuant to this paragraph 18,
pay and discharge all amounts which shall be determined to be payable therein
and shall be entitled to receive and retain for its own account all amounts
refunded and/or rebated as a result of any such contest and if the Lessor
receives any amount as a result of such contest to which it is not otherwise
entitled pursuant to this Lease, it shall promptly return such amount to the
Lessee.
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(d) Except as otherwise specifically provided in this Lease, this
paragraph 18 shall not apply in the case of Charges upon, or in respect of, any
Person other than the Lessor or in respect of the property or income of any
such Person.
18A. UNWIND FEE. Upon payment by the Lessee of the Unwind Fee and the
surrender of the Property to the Lessor pursuant to the conditions set forth in
Section 7.05 of the Participation Agreement, this Lease shall terminate.
19. DEFAULT PROVISIONS. (a) Any of the following occurrences or acts
shall constitute an event of default (each, an "EVENT OF DEFAULT") under this
Lease:
(i) if the Lessee shall fail to pay (a) any Fixed
Rent within five days or Additional Rent within ten days after
the date on which payment is due or (b) any other sum required
to be paid hereunder on the date on which such payment is due;
(ii) subject to the terms of paragraphs 11 and 18
relating to permitted contests, if the Lessee shall fail to pay
any Charges when such payment shall become due or within any
grace period provided for payment of such Charges;
(iii) if the Lessee shall fail to comply with any
Insurance Requirement;
(iv) if the Lessee shall fail to comply with the
requirements of paragraph 27(b) within the time periods
provided therein;
(v) if the Lessee shall grant, suffer to exist or
create any Lien (other than Permitted Encumbrances) upon either
Parcel, this Lease, or the Property or any part thereof or
interest therein or upon any Fixed Rent, Additional Rent or
other sum paid hereunder;
(vi) if the Lessee shall fail to observe or perform
any other covenant, condition or other provision hereof and such
failure shall continue for fifteen (15) days after the earlier
of (i) the date on which the Lessee becomes aware of such
failure or (ii) notice by the Lessor, the Agent or the Trustee
to the Lessee of such failure; PROVIDED, HOWEVER, that if such
failure is of such nature that it cannot be corrected by the
payment of money or otherwise within such 15-day period, such
failure shall not constitute an Event of Default so long as (x)
curative action reasonably satisfactory to the Lessor is
instituted within such period and diligently
26
pursued to completion thereafter and (y) periodic progress
reports thereon are delivered to the Lessor;
(vii) if an "Event of Default" (as defined in any such
other Operative Document, but excluding any Unwind Event) under
the Participation Agreement or any other Operative Document
shall have occurred;
(viii) if the Lessee has elected not to purchase the
Lessor's interest in the Property pursuant to paragraph
27(a)(ii), and if, ten (10) Business Days before the Expiration
Date, either (a) the Lessee is then rebuilding or restoring, or
would be required by the terms hereof to rebuild or restore, the
Property pursuant to paragraph 12(c) hereof or (b) a temporary
Condemnation has occurred and is scheduled to continue after the
Expiration Date;
(ix) if any Operative Document shall for any reason
no longer be in full force and effect (except if such is the
result of a purchase of the Property by the Lessee pursuant to
this Lease);
(x) if the Lessee shall have abandoned the Property
or the Improvements or if the Property or the Improvements
become vacant for a period of thirty (30) consecutive days;
(xi) if the Lessee shall lose any real property
interests, licenses or rights to access it currently holds with
respect to any sites on which any portion of the Improvements
are from time to time located and such loss would prevent the
Lessee from using such Improvements as contemplated by the
Operative Documents or hinder the enforcement of the Trustee's
remedies under the Services Agreement.
(b) The Lessor may take all steps to protect and enforce the rights of
the Lessor or obligations of the Lessee hereunder, whether by action, suit or
proceeding at law or in equity (for the specific performance of any covenant,
condition or agreement contained in this Lease, or in aid of the execution of
any power herein granted or for any foreclosure, or for the enforcement of any
other appropriate legal or equitable remedy) or otherwise as the Lessor shall
deem necessary or advisable.
(c)(i) If an Event of Default shall have occurred and be continuing,
including an Event of Default arising from the breach of a covenant, condition
or other provision hereof, then upon five (5) Business Days' prior written
notice by the Lessor to the Lessee, in addition to all other rights, remedies
or recourses available, the Lessor may either (A)
27
terminate this Lease or (B) terminate the Lessee's right to possession of the
Property or any part thereof. If Lessor should elect to terminate this Lease
as provided in subparagraph (c)(i)(A) above, then this Lease and the estate
hereby granted shall expire and terminate at midnight on the fifth (5th)
Business Day (or such later date as may be specified therein) after the date of
such notice, as fully and completely and with the same effect as if such date
was the date herein fixed for the expiration of the Term and all rights of the
Lessee shall terminate, but the Lessee shall remain liable as hereinafter
provided.
(ii) Should the Lessor elect not to terminate this Lease, this Lease
shall continue in effect and Lessor may enforce all Lessor's rights and
remedies under this Lease including the right to recover the Fixed and
Additional Rent as each becomes due under this Lease. For the purposes hereof,
the following do not constitute a termination of this Lease:
(A) Acts of maintenance or preservation of the Property
or any part thereof or efforts to relet the Property or any
part thereof, including, without limitation, termination of any
sublease of the Property to a third party and removal of such
subtenant from the Property; and/or
(B) The appointment of a receiver upon initiative of the
Lessor to protect the Lessor's interest under this Lease.
(d) If an Event of Default shall have occurred and be continuing, and
the Lessor has elected to terminate this Lease or terminate the Lessee's right
to possession of the Property or part thereof, upon five (5) Business Days'
notice, Lessor shall have (i) the right, whether or not this Lease shall have
been terminated pursuant to paragraph 19(c) hereof, to re-enter and repossess
the Property or any part thereof, as the Lessor may elect, by summary
proceedings, ejectment, any other legal action or in any other lawful manner
the Lessor determines to be necessary or desirable and (ii) the right to remove
all Persons and property therefrom. The Lessor shall be under no liability by
reason of any such re-entry, repossession or removal. No such re-entry or
repossession of the Property or any part thereof shall be construed as an
election by the Lessor to terminate this Lease unless a notice of such
termination is given to the Lessee pursuant to paragraph 19(c) hereof, or
unless such termination is decreed by a court or other governmental tribunal of
competent jurisdiction. Should the Lessor elect to re-enter the Property as
herein provided or should the Lessor take possession pursuant to legal
proceedings or pursuant to any
28
notice provided for by Law or upon termination of this Lease of the Lessee's
right to possession of the Property or any part thereof pursuant to paragraph
19(c) hereof or otherwise as permitted by Law, the Lessee shall peaceably quit
and surrender the Property or any part thereof to the Lessor. In any such
event, neither the Lessee nor any Person claiming through or under the Lessee,
by virtue of any Law, shall be entitled to possession or to remain in
possession of the Property or any such part thereof, but shall forthwith
quit and surrender the Property to the Lessor.
(e) At any time or from time to time after the re-entry or
repossession of the Property or any part thereof pursuant to paragraph 19(d)
hereof, whether or not this Lease shall have been terminated pursuant to
paragraph 19(c) hereof, the Lessor may (but shall be under no obligation to)
relet the Property or any part thereof, for the account of the Lessee, without
notice to the Lessee, for such term or terms and on such conditions and for
such uses as the Lessor, in its sole and absolute discretion, may determine.
The Lessor may collect and receive any rents payable by reason of such
reletting. The Lessor shall not be liable for any failure to relet the
Property or any part thereof or for any failure to collect any rent due upon
any such reletting.
(f) No termination of this Lease or of the Lessee's right to
possession of the Property or any part thereof pursuant to paragraph 19(c)
hereof, or by operation of Law, and no re-entry or repossession of the Property
or any part thereof, pursuant to paragraph 19(d) hereof, and no reletting of
the Property or any part thereof pursuant to paragraph 19(e) hereof, shall
relieve the Lessee of its liabilities and obligations hereunder, all of which
shall survive such termination, re-entry, repossession or reletting.
(g) In the event of any termination of this Lease or of the Lessee's
right to possession of the Property or any part thereof by reason of the
occurrence of any Event of Default, the Lessee shall pay to the Lessor all
Fixed Rent, Additional Rent and other sums required to be paid to and including
the date of such termination of this Lease or of the Lessee's right to
possession; and thereafter, until the end of the Term, whether or not the
Property or any part thereof shall have been relet, the Lessee to the extent
permitted by applicable Law shall be liable to the Lessor for, and shall pay to
the Lessor, on the days on which such amounts would be payable under this Lease
in the absence of such termination, re-entry or repossession, as agreed current
damages and not as a penalty: all Fixed Rent, Additional Rent and other sums
which would be payable under this Lease by the Lessee, in the absence of such
termination, re-entry or repossession, and all costs (including attorneys' fees
and expenses incurred by the
29
Lessor hereunder (payable on demand)) and all costs of any environmental
remediation required by Environmental Law. To the extent permitted by Law, at
such time after the termination or expiration of this Lease as the Lessee shall
have paid all amounts required to be paid by it under this Lease and the Lessor
shall have discharged any and all obligations to the Holders from time to time
of the Instruments, then the Lessor shall pay to the Lessee, when received, the
net proceeds, if any, of any reletting effected for the account of the Lessee
pursuant to paragraph 19(e), after deducting from such proceeds all of the
Lessor's expenses in connection with such reletting (including, but not limited
to, all repossession costs, brokerage commissions, attorneys' fees and
expenses, employees' expenses, alteration costs and expenses of preparation for
such reletting and all costs at any environmental remediation required by
Environmental Law).
(h) Notwithstanding the foregoing, if an Event of Default shall have
occurred, the Lessee may within five (5) Business Days of the earliest of the
Lessor's, Agent's or Trustee's notice of such occurrence thereafter pay to the
Lessor an amount equal to the Offer Purchase Price in which event the Lessor
shall be obliged to convey the Property to Lessee in compliance with paragraph
15.
(i) At any time after such termination of the Term of this Lease or
re-entry or repossession of the Property by reason of the occurrence of an
Event of Default, the Lessor shall be entitled to recover from the Lessee, and
the Lessee will pay to the Lessor on demand, in lieu of all liquidated damages
in respect of Fixed Rent beyond the date of such demand (but in addition to any
claim for current damages in respect of Fixed Rent prior to the date of such
demand), an amount equal to the Termination Value.
20. ADDITIONAL RIGHTS; MORTGAGE. (a) No right or
remedy hereunder shall be exclusive of any other right or remedy, but shall be
cumulative and in addition to any other right or remedy hereunder or now or
hereafter existing by Law or in equity and the exercise by the Lessor of any
one or more of such rights, powers or remedies shall not preclude the
simultaneous exercise of any or all of such other rights, powers or remedies.
Failure to insist upon the strict performance of any provision hereof or to
exercise any option, right, power or remedy contained herein shall not
constitute a waiver or relinquishment thereof for the future. Receipt by the
Lessor (or by the Trustee on behalf of the Lessor) of any Fixed Rent,
Additional Rent or other sum payable hereunder with knowledge of the breach by
Lessee of any provision hereof shall not constitute waiver of such breach, and
no waiver by the Lessor or the Trustee of any provision hereof shall be
30
deemed to have been made unless made in writing. The Lessor and the Trustee
shall be entitled to injunctive relief in case of the violation or attempted or
threatened violation of any of the provisions hereof, a decree compelling
performance of any of the provisions hereof or any other remedy allowed to the
Lessor by Law or in equity.
(b) The Lessee hereby waives and surrenders for itself and all those
claiming under it, including creditors of all kinds, (i) any right and
privilege which they may have to redeem the Property or any part thereof or to
have a continuance of this Lease after termination of the Lessee's right of
occupancy by Law or by any legal process or writ, or under the terms of this
Lease, or after the termination of the term of this Lease as herein provided
and (ii) the benefits of any Law which exempts property from liability for debt
or for distress for rent.
(c) If an Event of Default exists hereunder, the Lessee shall pay to
the Trustee, on behalf of the Lessor, all fees and out-of-pocket expenses
incurred by the Lessor or the Trustee in enforcing its rights under this Lease,
including attorneys' fees and expenses.
(d) Lessor and Lessee intend that the Lessee shall treat this Lease,
for accounting purposes, as an operating lease. If a court of competent
jurisdiction determines that the transaction represented by this Lease and the
other Operative Documents will be treated as a financing transaction, then in
such event it is the intention of the parties hereto (i) that this Lease be
treated as a deed of trust and security agreement, mortgage and security
agreement, or other similar instrument with a power of sale (the "MORTGAGE")
from Lessee, as mortgagor, to the Trustee for the benefit of Lessor, as
mortgagees, encumbering the Property, and that the Lessee, as mortgagor, hereby
(A) grants, bargains, conveys, mortgages, sells and sets over in trust, with
power of sale to the Trustee for the benefit of the Lessor and the Trustee, as
mortgagee, or any successor thereto, for the use and benefit of the Holders of
the Applicable Percentage of the Interim Notes, the Holders of the B-Notes and
the Holders of the Certificates, as beneficiaries, a first and paramount Lien
on the Property (subject to Permitted Encumbrances), and (B) grants a security
interest to the Lessor and the Trustee in the Property, (ii) that Lessor and
the Trustee shall have, as a result of such determination, all of the rights,
powers and remedies of a mortgagee and/or secured party available under
applicable Law to take possession of and sell (whether by foreclosure, power of
sale or otherwise) the Property, (iii) that the effective date of the Mortgage
shall be the effective date of this Lease, (iv) that the recording of an
instrument referencing this provision
31
shall be deemed to be the recording of the Mortgage and (v) that the Mortgage
shall secure the Secured Obligations.
(e) If this Lease shall hereafter be treated as the Mortgage as
provided in subparagraph 20(d) above, then the following provisions shall apply
in respect of the Lessor's and Trustee's enforcement of their rights under such
Mortgage: (i) upon request by the Lessor or the Trustee, the Trustee shall
proceed (under Chapter 9 of the Texas Business and Commerce Code with respect
to the Property located in Texas) to sell the Property and any and every part
thereof, at public venue, to the highest bidder, at the customary time and
place in the county where the Property is located, and at the time, place, and
under the terms designated in said notice of sale for cash, first giving the
public notice and notice to the Lessee required by law of the time, terms and
place of sale, and of the property to be sold; and upon such sale shall execute
and deliver a deed of conveyance of the Property sold to the purchaser or
purchasers thereof, and any statement or recital of fact in such deed in
relation to the nonpayment of money hereby secured to be paid, existence of the
indebtedness so secured, notice of advertisement, sale, receipt of money, and
the happening of any of the events whereby any successor Trustee became
successor as herein provided, shall be prima facie evidence of the truth of
such statement or recital; and the Trustee shall receive the proceeds of such
sale, out of which the Trustee shall pay, first the cost and expenses of
executing this trust, including attorneys' fees and compensation to the Trustee
for its services, and next to the Lessor or its endorsees or assignees, upon
the usual vouchers therefor, all monies paid pursuant to or under any
provisions set forth herein or in the Operative Documents; and next all monies
due and owing as to the Secured Obligations then due and unpaid (with interest
and Distributions at the Default Rate on any overdue amounts) up to the time of
such payment, and if not enough therefor, then apply what remains; and next to
all other unpaid sums secured hereby in such order as the Lessor may elect; and
the balance of such proceeds, if any, shall be paid to the person or persons
legally entitled thereto; and the Trustee covenants faithfully to perform the
trust herein created; (ii) until a sale shall be held hereunder, the Trustee
hereby lets the Property to the Lessee, upon the following terms and
conditions, to-wit: the Lessee, and every and all persons claiming or
possessing the Property, and any part thereof, by, through, or under it, shall
or will pay rent therefor during said term at the rate of one cent per month,
payable monthly upon demand, and shall and will surrender peaceable possession
of the Property, and any and every part thereof, to the Trustee, its
successors, assignees, or purchasers thereof, without notice or demand
therefor, upon the occurrence of said sale; (iii) upon any sale or sales made
hereunder, whether made under the power of sale herein granted
32
or under or by virtue of judicial proceedings or of a judgment or decree of
foreclosure and sale, the Lessor or the Trustee may bid for and acquire the
Property or any part thereof and, in lieu of paying cash therefor, may make
settlement for the purchase price by crediting upon the Secured Obligations the
net sales price after deducting therefrom the expenses of sale and the cost of
the action and any other sums which the Lessor is authorized to deduct under
this Lease, and, in such event, this Lease and the Operative Documents
evidencing the Secured Obligations may be presented to the persons or person
conducting the sale in order that the amount so used or applied may be credited
upon the Secured Obligations as having been paid; (iv) the Lessor and the
Trustee shall have the option to proceed with foreclosure in satisfaction of
any part of the Secured Obligations without declaring the whole of the Secured
Obligations as immediately due and payable, and such foreclosure may be made
subject to the part of the Secured Obligations not due and payable, and it is
agreed that such foreclosure, if so made, shall not in any manner affect the
part of the Secured Obligations, but as to such part this Lease, as treated as
the Mortgage, as well as the other Operative Documents, shall remain in full
force and effect just as though no foreclosure had been made. Several
foreclosures may be made without exhausting the right of foreclosure for any
part of the Secured Obligations not due and payable, it being the purpose to
provide for a foreclosure and sale of the security for any due and payable
portion of the Secured Obligations without exhausting the power of foreclosure
and power to sell the Property for any other part of the Secured Obligations;
and (v) the Lessor and the Trustee may, from time to time, substitute another
trustee in place of the Trustee herein named. Upon such appointment, and
without conveyance to the successor trustee, the latter shall be vested with
all the titles, estates, rights, powers and trusts conferred upon the Trustee
herein named. Such appointment shall be made by written instrument executed by
the Lessor and the Trustee which shall be recorded among the public records in
the county where the Property is located, and shall be conclusive proof of the
proper appointment of the successor trustee.
(f) In the exercise of any of the Lessor's and the Trustee's rights
under this paragraph 20, the Lessor and the Trustee shall comply with all
applicable requirements of Section 51.002 of the Texas Property Code, as the
same may be amended from time to time.
21. NOTICES, DEMANDS, AND OTHER INSTRUMENTS. All notices, offers,
consents and other instruments given pursuant to this Lease shall be sent to
the parties hereto at the addresses set forth on Schedule I to the
Participation Agreement and shall be given in the manner and shall be
33
effective at the times and under the terms set forth in Section 9.02 of the
Participation Agreement; PROVIDED that each of the Lessor and the Lessee may
from time to time specify, by giving not less than 15 days' prior written
notice thereof to the other party (i) any other address in the United States as
its address for purposes of this Lease and (ii) any other Person that is to
receive copies of notices, offers, consents and other instruments hereunder;
and PROVIDED that neither party shall be entitled to designate more than two
other Persons to receive copies of notices hereunder. The Lessee shall send to
the Trustee and Agent copies of all notices, offers, consents, advices and
other instruments hereunder sent to the Lessor. Notwithstanding anything to
the contrary herein or in the Operative Documents, all notices, consents and
other instruments required to be given by the Lessor hereunder may
alternatively be given by the Trustee on the Lessor's behalf.
22. NO DEFAULT CERTIFICATE. Each party hereto shall, at the
reasonable request of the other party hereto, deliver to such other party a
certificate stating whether such first party has knowledge of, or has received
notice from any person of, any Casualty, Condemnation, Default, Environmental
Trigger, Unwind Event or Event of Default.
23. SURRENDER. If upon the expiration or termination of the Term or
the termination of Lessee's possession of the Property, Lessee or its designee
has not purchased the Property as provided hereunder, (a) the Lessee shall
surrender (i) the Property to the Lessor in the condition in which the Property
was upon the commencement of the Term hereof (subject to subparagraph (c) below
and further subject to Improvements and other alterations and maintenance made
in accordance herewith) together with such additional easements, rights of way
or other rights as Lessor may require to assure unrestricted access to the
Property and (ii) the Improvements in the operating condition, efficiency and
with the useful life, they were or had upon the commencement of the Primary
Term, except as repaired, rebuilt, altered, added to or built as permitted or
required hereby and except for ordinary wear and tear. To the extent that the
Property is not in compliance with the above upon such expiration or
termination (except as a consequence of a Casualty or Condemnation, as to which
paragraph 12 applies), the Lessee shall pay to the Lessor such additional
amounts as are required to place it in compliance therewith.
(b) The Lessee shall also surrender the Property to the Lessor free
and clear of all Liens, easements, consents and restrictive covenants and
agreements affecting the Property which the Lessee is obliged hereunder to
remove.
34
(c) The Lessee shall also surrender the Property in a condition such
that the Property is in compliance with all applicable Environmental Laws at
surrender (irrespective of whether the deadline for such compliance would
otherwise expire before the end of the Term). Nothing contained in this
paragraph 23 shall relieve or discharge or in any way affect the obligation of
the Lessee to cure promptly pursuant to this Lease any violations of Legal
Requirements referred to in this Lease, or to pay and discharge any Liens and
Impositions against the Property, subject, however, to the right of the Lessee
to contest the same pursuant to the provisions of paragraphs 11 and 18. Lessee
shall cooperate, to the fullest extent, with the Lessor, its subsequent
lessees, operators or purchasers to effect the transfer of all of Lessee's
Applicable Permits for the Property to such Persons.
(d) The Lessee, at its sole cost and expense, shall remove from the
Property on or prior to such expiration or termination all property situated
thereon which is not owned by the Lessor and shall repair any damage caused by
such removal and shall restore the Property to the condition and working order
(or reasonable equivalent thereof) in which they existed immediately prior to
the installation of such property, except for ordinary wear and tear. Lessee
shall indemnify and hold harmless the Lessor, its successors and assigns
against any loss, liability or claim arising out of the Lessee's removal of
such property from the Property including, without limitation, any
environmental liability arising therefrom. Any such property of the Lessee not
so removed shall become the property of the Lessor, and the Lessor may cause
such property to be removed from the Property and disposed of, and the cost of
any such removal and disposition of the Lessee's property and of repairing any
damage caused by such removal and of the restoration of the Property to the
condition and working order (or reasonable equivalent thereof) in which it
existed immediately prior to the installation of such property, ordinary wear
and tear excepted, shall be borne by the Lessee.
(e) The Lessee shall comply with the conditions set forth in Section
7.05(b) of the Participation Agreement in addition to those set forth in this
paragraph 23.
(f) The obligations of the Lessee under this paragraph 23 shall
survive the expiration or any termination of this Lease (whether by operation
of Law or otherwise) for all matters described in this paragraph 23 which occur
or arise prior to such expiration or termination or arise out of or result from
facts, events, claims, liabilities, actions or conditions occurring, arising or
existing on or before such expiration or termination.
35
24. SEPARABILITY; BINDING EFFECT; GOVERNING LAW; NON-RECOURSE. (a)
Except as expressly provided otherwise in this Lease, each provision hereof
shall be separate and independent and the breach of any such provision by the
Lessor shall not discharge or relieve the Lessee from its obligations to
perform each and every covenant to be performed by the Lessee hereunder. If
any provision hereof or the application thereof to any Person or circumstance
shall be invalid or unenforceable, the remaining provisions hereof, or the
application of such provision to persons or circumstances other than those as
to which it is invalid or unenforceable, shall not be affected thereby, and
each provision hereof shall be valid and shall be enforceable to the extent
permitted by Law.
(b) All provisions contained in this Lease shall be binding upon,
inure to the benefit of, and be enforceable by, the respective permitted
successors and assigns of the Lessor and the Lessee to the same extent as if
each successor and assignee were named as a party hereto. Except for subleases
permitted or created in accordance with paragraph 17 hereof, the Lessee may not
assign its rights hereunder or any interest herein without the prior written
consent of the Lessor. Subject to the provisions of the other Operative
Documents, the Lessor may assign all or any part of the Property and/or its
rights under this Lease. This Lease may not be changed, modified or discharged
except by a writing signed by the Lessor and the Lessee. Any change,
modification or discharge made otherwise than as expressly permitted by this
paragraph 24 shall be null and void.
(c) THIS LEASE SHALL BE INTERPRETED, CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF OHIO EXCEPT FOR ISSUES WHICH ARE
MANDATORILY SUBJECT TO THE LAWS OF THE STATE OF TEXAS, WHICH ISSUES SHALL BE
INTERPRETED, CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS.
(d) This Lease, when delivered, shall constitute an original, fully
enforceable counterpart for all purposes except that only the counterpart
stamped or marked "COUNTERPART NUMBER ONE" or "COUNTERPART NUMBER 1" shall
constitute, to the extent applicable, "chattel paper" or other "collateral"
within the meaning of the Uniform Commercial Code in effect in any
jurisdiction.
(e) No recourse shall be had against the Lessor, SSBTC, the Agent or
any Holder of any Instrument or their respective successors, assigns,
directors, officers, employees, agents or shareholders, for any claim based on
any failure by the Lessor in the performance or observance of any of the
agreements, covenants or provisions contained in this
36
Lease and in the event of any such failure, recourse shall be had solely
against the Property; PROVIDED, HOWEVER, that nothing contained in this Lease
shall be taken to prevent enforcement of any claim against the Lessor or
any other Person arising out of or in connection with this Lease based on
fraud, gross negligence or willful misconduct of the Lessor and nothing shall
prevent enforcement against any other Person to which any part thereof shall
have been transferred, or obligations undertaken or assumed in writing by such
Person.
25. HEADINGS AND TABLE OF CONTENTS. The table of contents and the
headings of the various paragraphs and schedules of this Lease are for
convenience only and shall not affect the meaning of the terms and conditions
of this Lease.
26. LESSOR'S RIGHT TO CURE LESSEE'S DEFAULT. If the Lessee shall fail
to make any payment or perform any act required to be made or performed under
this Lease, the Lessor, without waiving any default or releasing Lessee from
any obligation, may (but shall be under no obligation to) make such payment or
perform such act for the account and at the cost and expense of the Lessee, and
may enter upon the Property for such purpose and take all such action thereon
as, at the Lessor's sole discretion, may be necessary or appropriate therefor.
No such entry shall be deemed an eviction of the Lessee or a breach of the
Lessor's covenant for quiet possession pursuant to paragraph 2(b). All sums so
paid by the Lessor and all costs and expenses (including, without limitation,
reasonable attorneys' fees and expenses so incurred, together with interest
thereon to the extent permitted by Law) shall be paid by the Lessee to the
Lessor on demand as Additional Rent.
27. LESSEE'S OPTIONS UPON EXPIRATION. (a) In addition to its rights
under paragraphs 12 and 14 hereof, Lessee shall, by notice given not less than
twelve (12) months prior to the Expiration Date, elect either to (i) deliver an
Offer to Purchase the Property in its entirety and purchase the Property on the
Expiration Date upon payment of an amount equal to the Offer Purchase Price, in
which case the transfer of the Property shall be governed by the terms of
paragraphs 14 and 15 (and in which case, this Lease (with the exception of
paragraph 24(e) or any other provision hereof under which the Lessee
indemnifies the Lessor or others from liability in connection with this Lease)
shall terminate on the Closing Date); or (ii) subject to the satisfaction of
the conditions set forth in paragraph 27(b) hereof, terminate this Lease,
abandon the Property as of the Expiration Date and pay to the Trustee, on
behalf of the Lessor on the Expiration Date, in addition to any Fixed Rent,
Additional Rent and any other amounts then due and payable to the Lessor
hereunder, the Residual Guaranty.
37
(b) Upon the election of the Lessee to terminate this Lease pursuant
to paragraph 27(a)(ii) hereof, Lessee shall provide, or cause to be provided or
accomplished, at the sole cost and expense of the Lessee, to or for the benefit
of the Lessor and the holders of the Instruments, at least thirty (30) days but
not more than sixty (60) days prior to the Expiration Date each of the items
set forth in Section 7.05 of the Participation Agreement.
(c) Upon the Lessee's election to terminate this Lease pursuant to and
in compliance with paragraph 27(a)(ii) hereof, the Lessor shall have the sole
and exclusive right to sell or dispose of the Property and, as of the
Expiration Date, the Lessee shall have no further claim thereto. The proceeds
of any sale or disposition of the Property pursuant to this paragraph 27
(herein called a "QUALIFIED SALE") shall be applied by the Trustee on the
Lessor's behalf as follows: FIRST, to pay all Closing Costs in connection with
the Qualified Sale; and SECOND, as provided in the Declaration.
(d) If Lessee is unable to satisfy one or more of the conditions set
forth in paragraph 27(b) hereof, or fails to elect either (i) or (ii) under
paragraph 27(a) hereof, the Lessee shall be deemed to have elected to proceed
under paragraph 27(a)(i) hereof, in which case Lessee shall purchase the
Property pursuant to and in accordance with said paragraph 27(a)(i).
28. LIMITATIONS ON AMOUNTS PAYABLE. Notwithstanding anything to the
contrary contained in this Lease or any of the other Operative Documents, the
amounts which the Lessee is obliged to pay pursuant to this Lease and the other
Operative Documents, and the amounts which Lessor, the Agent and the Note and
Certificate Purchasers are entitled to receive pursuant to this Lease and other
Operative Documents, are subject to limitations pursuant to Section 9.18 of the
Participation Agreement.
29. WAIVER OF TRIAL BY JURY. IN ANY ACTION OR PROCEEDING UNDER OR
RELATED TO THIS AGREEMENT, THE OPERATIVE DOCUMENTS OR ANY AMENDMENT,
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE
DELIVERED IN CONNECTION WITH THE FOREGOING, THE LESSOR AND THE LESSEE HEREBY
AGREE THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT
BEFORE A JURY, IRRESPECTIVE OF WHICH PARTY COMMENCES SUCH ACTION OR PROCEEDING.
30. NO MERGER OF TITLE. There shall be no merger of this Lease nor of
the leasehold estate created by this Lease with the fee ownership of either of
the Parcels by reason of the fact that the same Person may acquire, own or
hold, directly or indirectly, this Lease or the leasehold
38
estate created by this Lease or any interest in this Lease or interest in the
fee or leasehold ownership of either of the Parcels, and no such merger shall
occur unless and until all Persons having any interest in (x) the leasehold
estate created by this Lease and (y) the ownership of the Parcels or any part
thereof shall join in a written instrument effecting such merger and shall
duly record the same.
31. PAYMENTS TO THE TRUSTEE. The Lessee hereby acknowledges, and the
Lessor hereby directs, that all payments of Fixed Rent, Additional Rent and
other sums due to the Lessor hereunder shall be made to the Lessor, to the
account specified for the Trustee in Schedule I to the Participation Agreement.
39
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be duly
executed by their respective Officers thereunto duly authorized as of the date
hereof.
LESSOR:
------
STATE STREET BANK AND TRUST
COMPANY, not in its individual
capacity but solely as Trustee
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
[Seal]: Title: Assistant Vice President
LESSEE:
------
[Seal]:
FERRO CORPORATION
By: /s/ ▇. ▇. ▇▇▇▇▇▇
---------------------------
Name: D. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Treasurer
[Seal]:
[Seal]:
40
SCHEDULE A
----------
Description of the Parcels
--------------------------
(see attached)
A-1
SCHEDULE A
(Description of Ohio Parcels)
PARCEL NO. 1:
Situated in the City of Cleveland, County of Cuyahoga and State of Ohio and
known as being part of Original ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇. ▇, ▇▇▇▇▇ ▇▇, and more
particularly bounded and described as follows:
Beginning in the Southeasterly line of the Norfolk & Western Railroad Company's
Right-of-Way, 66 feet wide, formerly the New York, Chicago and St. Louis
Railroad Company, at its intersection with the centerline of Wayside Road,
N.E., 60 feet wide, said point of intersection bears North 33 degrees 30' 7"
West, measured along said centerline of Wayside Road, N.E., a
distance of 60.92 feet from a stone monument marking an angle in said
centerline.
Thence South 36 degrees 56' 30" West along said Southeasterly line of the
Norfolk & Western Railroad Company's Right-of-Way, a distance of 31.84 feet to
the Southwesterly line of Wayside Road, N.E., and the principal place of
beginning of the land herein described.
Course No. 1 - Thence South 36 degrees 56' 30" West, continuing along said
Southeasterly Right-of-Way line, a distance of 420.44 feet observed (420.25
feet deed) to the most Westerly corner of Parcel No. 1, conveyed to Synthetic
Products Company, by deed recorded in Volume 88-3864, Page 7 of Cuyahoga County
Official Records.
Course No. 2 - Thence South 53 degrees 03' 30" East, at right angles to said
Southeasterly Right-of-Way line, a distance of 161.24 feet observed (160.83
feet deed) to the most Southerly corner of said Parcel No. 1.
Course No. 3 - Thence North 50 degrees 01' 50" East, along a Southeasterly line
of said Parcel No. 1, a distance of 383.53 feet observed (383.51 feet deed) to
the Southwesterly line of Wayside Road, N.E.
Course No. 4 - Thence North 44 degrees 42' 20" West, along said Southwesterly
line, a distance of 200.08 feet observed (199.87 feet deed) to an angle
therein.
Course No. 5 - Thence North 33 degrees 30 feet, 07 inches West,
continuing along said Southwesterly line of Wayside Road, N.E., a distance of
53.20 feet observed (52.97 feet deed) to the principal place of beginning, and
containing 1.865 Acres of land, according to a survey made by ▇▇▇▇▇ Surveys
Company dated October 5, 1995, per A. ▇▇▇▇▇▇ ▇▇▇▇▇▇, Registered Professional
Land Surveyor No. 4432.
PARCEL NO. 2:
Appurtenant Easement created in the Deed from Anchor Rubber Products, Inc. to
Synthetic Products Company, an Ohio Partnership, filed for record September 17,
1951 at 1:10 P.M., and recorded in Volume 7299, Page 337 of Cuyahoga County
Records, and amended in Volume 91-0620, Page 25 of Cuyahoga County Records,
over the following described premises:
Situated in the City of Cleveland, County of Cuyahoga and State of Ohio and
known as being part of Original Euclid Township Lot Nos. 9, Tract 10, and more
particularly bounded and described as follows:
Beginning in the Northeasterly line of London Road, N.E., 60 feet wide, at a
point distant South 39 degrees 57' 30" East, measured along said Northeasterly
line of London Road N.E., a distance of 33.00 feet from its intersection with
the Southeasterly line of The Norfolk & Western Railroad Company (formerly The
New York, Chicago and St. Louis Railroad Company) right-of-way, 66 feet wide.
Course No. 1: Thence North 51 degrees 34' 00" East along said Southeasterly
right-of-way line, a distance of 175.55 feet to a point.
Course No. 2: Thence South 66 degrees 26' 00" East, a distance of 85.31 feet to
its intersection with the Southeasterly prolongation of the Southeasterly line
of land conveyed to Synthetic Products Company by deed recorded in Volume 7299
of Deeds. Page 337 of Cuyahoga County Records.
Course No. 3: Thence North 50 degrees 01' 50" East along said prolongation and
along said Southeasterly line, a distance of 391.35 feet to the Southwesterly
line of Wayside Road.
Course No. 4: Thence South 44 degrees 42' 20" East along said Southwesterly
line of Wayside Road, a distance of 20.07 feet to a point.
Course No. 5: Thence South 50 degrees 01' 50" West along a line which is
parallel with and distant Southeasterly 20 feet by rectangular measurement
from Course No. 3, a distance of
2
405.39 feet to a point.
Course No. 6: Thence North 66 degrees 26' 00" West along a line which is
parallel with and distant Southwesterly 20 feet by rectangular measurement
from Course No. 2, a distance of 85.68 feet to a point.
Course No. 7: Thence South 51 degrees 34' 00" West along a line which is
parallel with and distant Southeasterly 20 feet by rectangular measurement from
Course No. 1, a distance of 163.00 feet to the Northeasterly line of London
Road N.E.
Course No. 8: Thence North 39 degrees 57' 30" West along said Northeasterly
line of London Road, a distance of 20.01 feet to the place of beginning and
containing 13,063 Square Feet of land according to a survey made by ▇▇▇▇▇
Surveys Company dated September 21, 1988; revised September 28, 1988 and
October 15, 1988 and supplemented on March 31, 1989, per A. ▇▇▇▇▇▇ ▇▇▇▇▇▇,
Registered Professional Land Surveyor No. 4432.
PARCEL NO. 3:
Situated in the City of Cleveland, County of Cuyahoga and State of Ohio and
known as being part of Sublots Nos. 170, 178 and 194, all of Sublots Nos. 171
to 177, both inclusive, all of Sublots 195 to 202, both inclusive, and part of
Mandalay Avenue, N.E., now vacated, in the ▇▇▇▇▇▇▇▇ Realty Company's London
Road-Wayside Subdivision of part of Original Euclid Township Lot Nos. 9 and 42,
as shown by the recorded plat in Volume 54 of Maps, Page 30 of Cuyahoga County
Records, and part of Original ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇. ▇, ▇▇▇▇▇ ▇▇, and together
forming a parcel of land bounded and described as follows:
Beginning on the Southwesterly line of Wayside Road, N.E., 60 feet wide, at the
most Easterly corner of the fourteenth parcel of land conveyed to ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ by deed dated May 21, 1943 and recorded in Volume 5605, Page 506 of
Cuyahoga County Records;
Course No. 1 - Thence South 33 degrees 30' 07" East, along said Southwesterly
line of Wayside Road, N.E., a distance of 550.92 feet observed (550.86 feet
deed), to a point which is distant North 33 degrees 30', 07" West 26.53 feet,
measured along said Southwesterly line, from its intersection with the
Northwesterly line of the Norfolk & Western Railroad Company's Right-of-Way, 66
feet wide, formerly the New York, Chicago and St. Louis Railroad Company.
Course No. 2 - Thence South 36 degrees 56' 30" West, and parallel with the
Northwesterly line of said Right-of-Way, a distance of 271.58 feet deed and
observed, to the most Southerly corner of Parcel No. 4 conveyed to
Synthetic Products
3
Company, by deed recorded in Volume 86-3864, Page 7 of Cuyahoga County Official
Records.
Course No. 3 - Thence North 39 degrees 58' 30" West, along the Southwesterly
line of said Parcel No. 4, a distance of 608.92 feet observed (608.89 feet
deed) to the Northwesterly line of said Sublot No. 178.
Course No. 4 - Thence North 50 degrees 01' 54" East, along the Northwesterly
line of Sublots Nos. 178 to 173, both inclusive, and along the Southeasterly
line of the fourteenth parcel of land conveyed to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ by deed,
as aforesaid, a distance of 326.64 feet observed (326.58 feet deed) to the
place of beginning, and containing 3.901 Acres of land, according to a survey
made by ▇▇▇▇▇ Surveys Company dated October 5, 1995, per A. ▇▇▇▇▇▇ ▇▇▇▇▇▇,
Registered Professional Land Surveyor No. 4432.
4
(Description of Texas Parcels)
▇▇▇▇▇ ▇
▇▇▇ ▇, ▇▇▇▇▇ 2 FERROCHEMICALS ADDITION to the City of Fort Worth, Tarrant
County, Texas, according to plot recorded in Volume 388-206, Page 26, Deed
Records of Tarrant County, Texas.
Tract 4
▇▇▇ ▇, ▇. ▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ADDITION, and part of the
E. LITTLE SURVEY adjoining said Lot on the North, said property being further
described by notes and bounds as follows:
BEGINNING 13.20 feet North of the Northwest corner of the F. C. Killiken
Survey, being the Northeast corner of the ▇. ▇▇▇▇▇ Survey; same being the most
Northerly Northeast corner of said Lot 1 in the Southeasterly line of Central
Avenue;
THENCE North 50 degrees 36 minutes 13 seconds east with the Southeast line of
Central Avenue if extended Northeast 36.88 feet to a 1 inch iron pin found in
the West right-of-way line of the Burlington Northern Railroad;
THENCE South 06 degrees 27 minutes 13 seconds West along said West right-of-way
line 135.45 feet to a point in the West line of said Lot 1:
THENCE North 30 degrees 05 minutes 17 seconds West along the West line of said
Lot 1, 95.39 feet to a 1 inch iron pin found in the Southeasterly line of
Central Avenue, and the Northerly line of said Lot 1:
THENCE North 50 degrees 19 minutes 45 seconds East along the Southeasterly line
of Central Avenue 44.88 feet to the POINT OF BEGINNING.
5
(Description of Burdened Property-Easement Agreement).
TRACT NO. 1:
From the northeast corner of ▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇, ▇. ▇. ▇▇▇▇▇ Addition,
measure east along the south line of ▇▇▇▇ ▇▇▇▇▇▇ extended a distance of 106
feet, more or less, to the point of beginning, said point being 22 feet west of
the centerline of Lessor's main tract, measured perpendicularly thereto;
Thence continue east along the south line of ▇▇▇▇ ▇▇▇▇▇▇ extended a
distance of 211 feet, more or less, to a corner in Lessor's property lines;
Thence South along Lessor's property line 400 feet to a point;
Thence South 18 degrees, 25' W. a distance of 48 feet, more or
less, to a point, said point being 9 feet easterly from the centerline of
Lessor's main track, measured perpendicularly thereto;
Thence, is a northeasterly direction 3 feet from and parallel to
Lessor's main track, a distance of 275 feet to a point;
Thence northeasterly, on a course perpendicular to Lessor's main
track, a distance of 13 feet to a point;
Thence northeasterly, on a course parallel to and 22 feet from
Lessor's main track, a distance of 200 feet, more or less, to the point of
beginning.
Containing 1.1 acres more or less.
TRACT NO. 2:
From the northeast corner of ▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇, ▇. ▇. ▇▇▇▇▇ Addition,
measure south along the east line of lot 12 a distance of 7.5 feet to a point,
thence South 21 degrees, 48' a distance of 7.7 feet, more or less, to
the point of beginning, said point being 15 feet southerly from and at right
angles to the centerline of Lessor's ▇▇▇▇ ▇▇▇▇▇▇ main track;
Thence South 21 degrees, 48' E. a distance of 415 feet, more or
less, to the southern corner of ▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇, said Addition;
Thence South 173.5 feet to a point in Lessor's southerly property
line;
Thence East along said southerly property line 102.2 feet to a point
in Lessor's easterly property line;
Thence North 18 degrees, 25' E. along said easterly property line a
distance of 96 feet, more or less, to a point, said point being 15 feet
westerly from and parallel to the centerline of Lessor's main track;
Thence, in a northeasterly direction, 15 feet westerly from and
parallel to the centerline of Lessor's main track, a distance of 415 feet, more
or less, to a point opposite the point of switch of Lessor's ▇▇▇▇ ▇▇▇▇▇▇ main
track;
Thence, in a northeasterly direction, 15 feet from and concentric with
the centerline of said main track, a distance of 150 feet, more or less, to the
point of beginning.
Containing 1.3 acres, more or less.
6
(Description of Burdened Property
Second Easement Agreement)
Tract 3 as shown on that certain plat entitled "Plat Showing an
ALTA/ACSM Land Title Survey of ▇▇▇▇▇ ▇, (▇▇▇ ▇, ▇▇▇▇▇ 2, Petrochemicals
Addition). ▇▇▇▇▇ ▇, (▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇▇▇ Stockyards Properties).
Tract 4, (Lot 1, ▇. ▇. ▇▇▇▇▇▇ Subdivision & a portion of E. Little Survey) and
▇▇▇▇▇ ▇ (▇▇▇▇ ▇▇ & ▇▇, ▇▇▇▇▇ ▇▇▇, ▇. ▇. ▇▇▇▇▇ Addition). To the City of Forth
Worth, Tarrant County, Texas September 12, 1995, as amended October 12, 1995",
of Area Surveying, Inc.,
AND
Tract 5 as shown on that certain plat entitled "Plat Showing an
ALTA/ACSM Land Title Survey of ▇▇▇▇▇ ▇, (▇▇▇ ▇, ▇▇▇▇▇ 2, Petrochemicals
Addition). ▇▇▇▇▇ ▇, (▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇▇▇ Stockyards Properties).
Tract 4, (Lot 1, ▇. ▇. ▇▇▇▇▇▇ Subdivision & a portion of E. Little Survey) and
▇▇▇▇▇ ▇ (▇▇▇▇ ▇▇ & ▇▇, ▇▇▇▇▇ ▇▇▇, ▇. ▇. ▇▇▇▇▇ Addition). To the City of Forth
Worth, Tarrant County, Texas September 12, 1995, as amended October 12, 1995",
of Area Surveying, Inc.
7
(Description of license agreement property)
MAP
8
SCHEDULE B
----------
Fixed Rent and Additional Rent Schedule
---------------------------------------
Capitalized terms used herein and not defined herein shall have the
meanings assigned to them in the Lease (including terms defined by reference in
the Lease to the other Operative Documents).
I. Fixed Rent
----------
A. Fixed Rent
----------
1. The "ORIGINAL CAPITALIZED COST" of the Property is equal to the sum
of the aggregate principal amounts outstanding of the A-Notes and the
B-Notes plus the aggregate stated amount of the Certificates.
The "SERIES A PORTION" of the Original Capitalized Cost is equal to
the aggregate outstanding principal amount of the A-Notes.
The "SERIES 1-A PORTION" of the Original Certificate Cost is equal to
the aggregate outstanding principal amount of the Series 1
A-Notes.
The "SERIES B PORTION" of the Original Capitalized Cost is equal to
the aggregate outstanding principal amount of the B-Notes.
The "SERIES 1-B PORTION" of the Original Capitalized Cost is equal to
the aggregate outstanding principal amount of the Series 1 B-Notes.
The "SERIES C PORTION" of the Original Capitalized Cost is equal to
the aggregate outstanding stated amount of the Certificates.
The "SERIES 1-C PORTION" of the Original capitalized Cost is equal to
the aggregate outstanding stated amount of the Series 1
Certificates.
B-1
FIXED RENT shall be due and payable in arrears on each Payment Date
in the amounts set forth below.
(a) Construction Period:
For the portion of the Construction Period during which interest
on the Interim Notes can be paid from Advances under the
Participation Agreement, "FIXED RENT" for each Payment Date
shall equal the sum of (A) an amount equal to the product of the
Series 1-A Portion of the Original Capitalized Cost of the
Property times the Applicable Rate, (B) an amount equal to the
product of the Series 1-B Portion of the Original Capitalized
Cost of the Property times the Applicable Rate, and (C) an
amount equal to the product of the Series 1-C Portion of the
Original Capitalized Cost of the Property times the Applicable
Rate, in each case calculated on the basis of a 360-day year and
prorated for the actual number of days of such period.
For the balance of the Construction Period, Fixed Rent shall
include, in addition to the amount set forth above, an amount
equal to the product of the aggregate principal amount of the
Interim Notes times the Applicable Rate, all calculated on the
basis of a 360-day year and prorated for the actual number of
days of such period.
If the Interim Notes are refinanced on a day which is not a
regular Payment Date, Fixed Rent shall be proportionately
adjusted to such date of exchange, and any additional costs
incurred by the Lessor in connection with such refinancing shall
also be payable on such date as Additional Rent under this
Lease, a certificate as to the amount of such costs submitted to
the Lessee by the Lessor shall be conclusive and binding for
all purposes, absent manifest error.
B-2
(b) Primary Term:
"FIXED RENT" for each Payment Date during the Primary Term shall
equal the sum of (A) an amount equal to the product of the
Series A Portion of the Original Capitalized Cost of the
Property times the Applicable Rate, calculated on the basis of a
360-day year and prorated for the actual number of days of such
period, (B) an amount equal to the product of the Series B
Portion of the Original Capitalized Cost of the Property times
the Applicable Rate, calculated on the basis of a 360-day year
and prorated for the actual number of days of such period, and
(C) an amount equal to the product of the Series C Portion of
the Original Capitalized Cost of the Property times the
Applicable Rate, calculated on the basis of a 360-day year and
prorated for the actual number of days of such period since
the last Payment Date.
II. ADDITIONAL RENT
In addition to such Additional Rent as may otherwise be payable under the
Lease, Lessee shall pay within thirty (30) days of a demand therefor but
subject in all cases to Lessee's rights under the Operative Documents, as
Additional Rent, without duplication, all Break Costs, Funding Costs,
Reserve Costs, Increased Costs and Illegality Costs (collectively,
"ADDITIONAL COSTS").
Promptly after Lessor receives notice from any holder of Instruments of
any Additional Costs to be payable as Additional Rent Lessor shall supply
(i) a copy of the same to the Lessee; PROVIDED, HOWEVER, that the failure
to provide such notice of any Additional Costs shall not affect the
Lessor's right to recover Additional Rent for the same but shall merely
affect the timing of such recovery; and (ii) a certificate in reasonable
detail setting forth the basis for and the amount of such Additional Costs
submitted by the Lessor (on behalf of a holder) to the Lessee which notice
shall be conclusive and binding for all purposes, absent manifest error.
B-3
SCHEDULE C
----------
Termination Value
-----------------
A. Termination Value.
-----------------
The "TERMINATION VALUE" of the Property as of any date shall be an
amount equal to the Adjusted Capitalized Cost of the Property and any Closing
Costs incurred in connection with the payment of such Adjusted Capitalized Cost
and/or the sale of the Property.
B. Adjusted Capitalized Cost:
-------------------------
The "ADJUSTED CAPITALIZED COST" of the Property, at any time, as a
whole is (i) after the consummation of the refinancing of the Interim Notes
contemplated by Article III of the Participation Agreement, the sum of the
Series A Portion, Series B Portion and Certificate Portion of the Adjusted
Capitalized Cost; and (ii) prior to the consummation of such refinancing of the
Interim Notes, the sum of the then outstanding aggregate principal amount of
the Interim Notes and the Series 1 Notes, together with interest accrued and
unpaid and all other amounts due thereon or with respect thereto, and the
Certificate Portion of the Adjusted Capitalized Cost.
The "SERIES A PORTION" of the Adjusted Capitalized Cost at any time
shall be equal to the then outstanding aggregate principal amount of the
A-Notes together with interest accrued and unpaid and all other amounts due
thereon or with respect thereto;
The "SERIES B PORTION" of the Adjusted Capitalized Cost at any time
shall be equal to the then outstanding aggregate principal amount of the
B-Notes, together with interest accrued and unpaid and all other amounts due
thereon or with respect thereto; and
The "CERTIFICATE PORTION" of the Adjusted Capitalized Cost at any time
shall be equal to the then outstanding aggregate stated amount of the
Certificates together with Distributions and all other amounts due thereon or
with respect thereto.
Capitalized terms used herein and not defined herein shall have the
meanings ascribed to them in the Lease (and the other Schedules thereto) to
which this Schedule C is attached, including terms defined by reference in the
Lease to the other Operative Documents.
C-1
--------------------------------------------------------------------------------
AMENDED AND RESTATED PARTICIPATION AGREEMENT
dated as of November 30, 2000
among
FERRO CORPORATION,
STATE STREET BANK AND TRUST COMPANY
not in its individual capacity except as
expressly stated herein, but solely as Trustee,
THE FINANCIAL INSTITUTIONS NAMED HEREIN,
as Purchasers
and
CITIBANK, N.A.,
as Agent
--------------------------------------------------------------------------------
TABLE OF CONTENTS
Page
----
Preliminary Statement..................................................................................... 1
ARTICLE I................................................................................................. 3
SECTION 1.01. Simultaneous Amendment Effective Date Transactions................................. 3
SECTION 1.02. Amendment of Prior Transaction..................................................... 3
ARTICLE II. CONDITIONS PRECEDENT.......................................................................... 4
SECTION 2.01. Conditions Precedent to the Amendment Effective Date............................... 4
ARTICLE III. [Intentionally Omitted]...................................................................... 6
ARTICLE IV. REPRESENTATIONS AND WARRANTIES................................................................ 6
SECTION 4.01. Company Representations and Warranties............................................. 6
SECTION 4.02. SSBTC Representations and Warranties............................................... 11
ARTICLE V. COVENANTS...................................................................................... 13
SECTION 5.01. Company's Covenants................................................................ 13
ARTICLE VI. THE NOTES AND THE CERTIFICATES................................................................ 23
SECTION 6.01. Determination of Rates............................................................. 23
SECTION 6.02. Assignments and Participations..................................................... 24
SECTION 6.03. Taxes.............................................................................. 27
SECTION 6.04. Substitution of Purchaser.......................................................... 29
SECTION 6.05. Sharing of Payments, Etc........................................................... 30
SECTION 6.06. Tax Treatment Etc.................................................................. 30
ARTICLE VII. EVENTS OF DEFAULT AND UNWIND EVENTS.......................................................... 31
SECTION 7.01. Events of Default.................................................................. 31
SECTION 7.02. Remedies upon an Event of Default.................................................. 33
SECTION 7.03. [Intentionally Omitted]............................................................ 33
SECTION 7.04. [Intentionally Omitted]............................................................ 33
SECTION 7.05. Residual Guaranty and Return Conditions............................................ 33
ARTICLE VIII. THE AGENT................................................................................... 35
SECTION 8.01. Authorization and Action........................................................... 35
i
Page
----
SECTION 8.02. Agent's Reliance, Etc.............................................................. 35
SECTION 8.03. Citicorp and Affiliates............................................................ 36
SECTION 8.04. Purchaser Credit Decision.......................................................... 36
SECTION 8.05. Indemnification.................................................................... 36
SECTION 8.06. Successor Agent.................................................................... 37
ARTICLE IX. MISCELLANEOUS................................................................................. 37
SECTION 9.01. Survival........................................................................... 37
SECTION 9.02. Notices............................................................................ 37
SECTION 9.03. Severability....................................................................... 38
SECTION 9.04. Amendments, Etc.................................................................... 38
SECTION 9.05. Headings........................................................................... 38
SECTION 9.06. Compliance Responsibility.......................................................... 38
SECTION 9.07. Definitions........................................................................ 39
SECTION 9.08. Benefit............................................................................ 39
SECTION 9.09. Place of Payment................................................................... 39
SECTION 9.10. Counterparts....................................................................... 39
SECTION 9.11. Governing Law and Jurisdiction..................................................... 39
SECTION 9.12. Time; Business Day................................................................. 40
SECTION 9.13. The Trustee........................................................................ 40
SECTION 9.14. Transaction Costs; Upfront Fees.................................................... 40
SECTION 9.15. INDEMNIFICATION.................................................................... 41
SECTION 9.16. Operative Documents; Further Assurances............................................ 44
SECTION 9.17. Confidentiality.................................................................... 45
SECTION 9.18. Interest........................................................................... 45
SECTION 9.19. Waiver of Trial by Jury............................................................ 47
SECTION 9.20. Option............................................................................. 47
SECTION 9.21. Financial Advisor.................................................................. 47
SECTION 9.22. Securities Representation.......................................................... 48
SECTION 9.23. Unenforceability of Oral Agreements; (Texas Statutory
Language).......................................................................... 48
Schedule I Manner of Payment and Communications to Parties
Schedule II Pricing Grid
Schedule 4.01(r) Environmental Compliance
ii
AMENDED AND RESTATED PARTICIPATION AGREEMENT dated as of October 31,
1995 and amended and restated as of November 30, 2000 (as it may be amended from
time to time, this "Agreement"), by and among Ferro Corporation, an Ohio
corporation (the "Company") State Street Bank and Trust Company, a Massachusetts
trust company ("SSBTC"), not in its individual capacity except as expressly
stated herein, but solely as Trustee under the Declaration (herein, together
with any successor trustee under the Declaration, the "Trustee"); the financial
institutions named as purchasers on Schedule I hereto, and/or any assignee
thereof who may, from time to time, become a party to this Agreement pursuant to
the terms hereof (collectively, the "Purchasers") and Citibank, N.A.
("Citibank"), in its capacity as agent for the Purchasers hereunder. Capitalized
terms used but not otherwise defined in this Agreement shall have the meanings
set forth in Appendix A hereto.
Preliminary Statement
A. Synthetic Products Company, a Delaware corporation ("Synpro"),
was the owner of (i) certain parcels of land described on Schedule A to the Ohio
Deed and located in Cleveland, Ohio (the "Ohio Fee Parcels"), (ii) an easement
interest in a certain parcel of land described on Schedule A to the Ohio Deed
and located in Cleveland, Ohio (the "Ohio Easement Parcel" and together with the
Ohio Fee Parcels, the "Ohio Parcels") (iii) a license interest with respect to a
parcel of land in Cleveland, Ohio as described on Schedule A to the License
Agreement (the "License Parcel"), (iv) two parcels of land described on Schedule
A to the Texas Deed and located in Fort Worth, Texas (the "Texas Fee Parcels",
and together with the Ohio Fee Parcels, collectively, the "Fee Parcels"), (v)
certain parcels of land described in the Easements and Option to Purchase
between Synpro and the Company dated as of October 31, 1995 and located in Fort
Worth, Texas (the "Texas Easement Parcels"), (vi) a leasehold interest in
certain parcels of land described in the Easement and located in Fort Worth,
Texas (the "Texas Leasehold Parcels" and together with the Ohio Easement Parcel
and Texas Easement Parcels, collectively, the "Easement Parcels"), (vii) a plant
for the manufacture of stearates, lubricants and stabilizers and related
facilities located on the Ohio Fee Parcels (the "Ohio Plant"), (viii) a plant
for the manufacture of stearates, lubricants and stabilizers located on the
Texas Fee Parcels (the "Texas Plant" and together with the Ohio Plant,
collectively, the "Plants"), (ix) certain improvements located on the Texas
Leasehold Parcel and used in connection with the operation of the Texas Plant
(the "Texas Leasehold Improvements"), (x) certain improvements located on the
Texas Easement Parcel and used in connection with the Texas Plant (the "Texas
Easement Improvements"), (xi) certain fixtures, equipment and other personal
property used in connection with the Plants and presently located on (a) the
Ohio Fee Parcels (the "Initial Ohio Fee Improvements"), (b) on the Texas Fee
Parcels (the "Initial Texas Fee Improvements") and (c) on the License Parcel
(the "Initial License Improvements") (collectively, the "Assets" and together
with the Plants, the "Initial Improvements") as described on Schedule A to the
▇▇▇▇ of Sale.
B. On the Financing Closing Date, the Trustee acquired from Synpro
fee title to the Ohio Fee Parcels and the Texas Fee Parcels, an easement
interest in the Ohio Easement Parcel, a license to the License Parcel and title
to a portion of the Initial Improvements pursuant to an Asset Purchase Agreement
dated as of October 25, 1995 among Synpro, ▇▇▇▇▇▇▇ Group, plc, ▇▇▇▇▇▇▇ America,
Inc. and the Company (as the same may be amended from time to time, the
"Purchase Agreement"). In addition, on the Financing Closing Date, (a) the
Company acquired from Synpro (i) the leasehold estate to the Texas Leasehold
Parcel pursuant to the Purchase
Agreement, and (ii) easements over the Texas Easement Parcel pursuant to the
Purchase Agreement, and (b) the Trustee acquired from the Company (i) easements
over the Texas Leasehold Parcel and to the Texas Easement Improvements pursuant
to the Easement, and (ii) the easements over the Texas Easement Parcels pursuant
to the Second Easement. Thereafter, certain improvements to the Initial
Improvements (the "Financed Improvements") were constructed, as more fully
described in Exhibit A to the Agency Agreement referred to below. The Initial
Improvements and the Financed Improvements, together with all future structures,
buildings, fixtures and other immovable improvements now or hereafter on the Fee
Parcels, the Easement Parcels and the License Parcel and all integral equipment
to be located thereon or therein are collectively defined as the "Improvements".
The Trustee's fee interest in the Fee Parcels, easement interests in the
Easement Parcels, license to the License Parcel and interest in the Improvements
are sometimes referred to herein as the "Property". After acquiring the Property
as described above, the Trustee leased (or granted a license to portions of) the
Property to the Company pursuant to a lease dated as of October 31, 1995 and
amended as of the date hereof (as the same may be amended from time to time, the
"Lease").
C. The Company, acting as the Trustee's Construction Agent under an
agency agreement dated as of October 31, 1995 (as amended, the "Agency
Agreement"), completed the construction of the Financed Improvements.
D. To finance the Trustee's acquisition of the Parcels and the
Initial Improvements, the Trustee, on the Financing Closing Date, issued to the
Certificate Purchaser the Series 1 Certificates and issued to the Note
Purchasers Series 1 A-Notes and Series 1 B-Notes pursuant to a declaration of
trust dated as of October 31, 1995 (as the same may be amended from time to
time, the "Declaration" or "Declaration of Trust"). To finance the construction
of the Financed Improvements, the Trustee issued on the Financing Closing Date,
Interim Notes to the Note Purchasers and Series 2 Certificates to the
Certificate Purchasers pursuant to the Declaration.
E. Subject to the terms and conditions of the Original Participation
Agreement, the Note Purchasers made Advances on the Financing Closing Date and
from time to time thereafter, and each Certificate Purchaser made Investments
for all amounts paid or payable as: (a) costs for (i) the acquisition of the
Parcels and the Improvements, and (ii) the design, engineering, construction,
operation, testing and licensing of the Improvements; (b) interest,
distributions and fees paid or payable on or with respect to the Interim Notes
and Series 2 Certificates on or prior to the Interim Note Maturity Date, (c)
interest, distributions, fees and expenses paid or payable on any Payment Date
between March 21, 1996 and December 25, 1996 with respect to the Series 1
A-Notes, the Series 1 B-Notes and the Series 1 Certificates and (d) fees and
expenses paid in connection with the Operative Documents and the transactions
contemplated hereby (all amounts specified in the foregoing clauses (a), (b),
(c) and (d), collectively, "Actual Project Costs"). Upon the Interim Note
Maturity Date, the Trustee refinanced the Interim Notes through the issuance of
a specified proportion of Series 2 A-Notes and Series 2 B-Notes, issued pursuant
to the Declaration in the same aggregate principal amount as the Interim Notes.
The Instruments were issued, dated and mature and are payable as provided in the
Declaration. The Instruments shall be entitled to the benefit of the Trust
Estate held pursuant to the Declaration.
F. The Company entered into a guaranty agreement dated as of October
31, 1995 (as the same may be amended from time to time, the "Instrument
Guaranty") pursuant to
2
which the Company guaranties repayment by the Trustee of the Instruments to the
extent provided therein. Pursuant to this amendment, the Company shall confirm
its obligations under the Instrument Guaranty.
G. The Company also entered into a services agreement dated as of
October 31, 1995, (as the same may be amended from time to time, the "Services
Agreement") pursuant to which it will be obligated to provide certain services
to the Trustee and with respect to the Property in the event the Company does
not purchase the Property at the expiration or other termination of the Lease.
H. In addition, the Company entered into the Expiration Date
Amendment dated as of October 30, 2000 (the "Expiration Date Amendment")
pursuant to which the Company desired that the Expiration Date of the Lease and
the Maturity Date of the Instruments be extended from October 31, 2000 to
November 30, 2000.
I. The Company now desires to amend and restate this Agreement and
amend certain of the other Operative Documents to extend the Term of the Lease
and incorporate the provisions from prior amendments of this Agreement. The
Purchasers, the Agent and the Trustee are willing to agree to such amendments
subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the agreements herein and in the
other Operative Documents and in reliance upon the representations and
warranties set forth herein and therein, the parties agree as follows:
ARTICLE I.
SECTION 1.01. Simultaneous Amendment Effective Date Transactions. On
the Amendment Effective Date, subject to the satisfaction of the conditions set
forth in Section 2.01 of this Agreement, the following agreements shall be duly
executed and delivered by the parties thereto.
(a) this Agreement;
(b) the First Amendment to Declaration of Trust;
(c) the First Amendment to Lease;
(d) Confirmation of Instrument Guaranty.
SECTION 1.02. Amendment of Prior Transaction. The Note Holders and
Certificate Holders consent to the execution by the Trustee and the Agent of the
letter agreement dated as of the date hereof among the Company, the Trustee and
the Agent.
3
ARTICLE II.
CONDITIONS PRECEDENT
SECTION 2.01. Conditions Precedent to the Amendment Effective Date.
The effectiveness of the amendment of the Operative Documents contemplated
hereby shall be subject to the fulfillment, to the satisfaction of the Agent, on
or before the Amendment Effective Date, of the following conditions precedent:
(a) Due Authorization, Execution and Delivery. The Amendment
Documents shall have been duly authorized, executed and delivered by all parties
thereto and shall be in full force and effect. No condition or event shall exist
or have occurred which would constitute a Default or Event of Default under any
of the Operative Documents by any party thereto and the Trustee and the Company
shall each have delivered an Officer's Certificate as to the Company's or the
Trustee's respective compliance dated the Amendment Effective Date.
(b) Representations. The representations and warranties of each of
the Company and SSBTC, respectively, set forth in the Operative Documents shall
be true and correct on and as of the Amendment Effective Date, and the Company
and SSBTC shall each have delivered an Officer's Certificate dated the Amendment
Effective Date to such effect as to their respective representations and
warranties.
(c) Opinions. An opinion of Squire, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P.,
special counsel to the Company, dated the Amendment Effective Date and addressed
to the Agent, the Purchasers and the Trustee, shall have been delivered in form
and substance satisfactory to the Agent and Special Counsel.
(d) Proceedings Satisfactory and Other Evidence. All corporate and
other proceedings taken or to be taken in connection with the transactions
contemplated by the Operative Documents and all documents, papers and
authorizations relating thereto shall be satisfactory to the Agent, the Company
and their respective counsel. The Agent and the Company, and their respective
counsel shall receive copies of such documents and papers as they have
requested, in form and substance satisfactory to them, including but not limited
to the Operative Documents.
(e) Closing Fees. The Company shall have paid (i) to Special Counsel
and the Trustee's Counsel, the reasonable fees and expenses of such counsel that
are set forth in invoices submitted by such counsel to the Company at least two
days prior to the Amendment Effective Date, (ii) to Citibank, N.A., the
structuring, advisory and placement fee referred to in the engagement letter
dated as of September 12, 2000 (the "Advisory Fee"), and (iii) such other
amounts as the Company may be required to pay on or before the Amendment
Effective Date in accordance with the terms of the Operative Documents.
(f) [Intentionally Omitted.]
4
(g) Compliance with Law. The Property and the Company shall be in
material compliance with all Laws, including, without limitation, all building,
construction and zoning Laws and Environmental Laws applicable to the Property
or any part thereof.
(h) Permits and Certain Property Matters. (i) All Permits that are
or will become Applicable Permits shall have been obtained. All such Permits
shall be in proper form, shall be in full force and effect and not subject to
any further appeal, consent or further contest or to any unsatisfied condition
that may allow modification or revocation; and
(ii) The Property shall not have suffered a Condemnation or a
Casualty, or any other damage or destruction which renders the Property unusable
in whole or in material part and, under applicable Law, the Property may be used
for the purposes contemplated by the Company in accordance with the Lease.
(i) Documents Relating to the Property. The Company shall deliver,
or cause to be delivered, to the Trustee, the Agent and the Purchasers
documentation with respect to the condition of the Property or any part thereof,
the real estate Taxes applicable to the Parcels and the Property and such other
documents and agreements (including but not limited to a copy of the
Construction Contracts and any other necessary Facility Agreements to the extent
available, or assignments thereof) relating to the operation of the Property or
any part thereof as the Agent or the Purchasers may reasonably request, in form
and substance reasonably acceptable to the Agent and the Purchasers.
(j) Insurance. The Company shall (i) maintain, and cause each of its
Subsidiaries to maintain, insurance in accordance with the provisions of Section
5.01(c); and (ii) be in compliance with all Insurance Requirements. The Company
shall deliver, or cause to be delivered, to the Trustee and the Agent: (i)
certificates of insurance, applicable reinsurance cover notes or other
satisfactory assurances, evidencing the coverage of such policies in compliance
with the Insurance Requirements; and (ii) copies of the exceptions to coverage
of such policies.
(k) Taxes. All Taxes (other than Excluded Charges), fees and other
charges which have become due and payable in connection with the execution and
delivery of the Operative Documents and the Amendment Documents shall have been
paid by the Company.
(1) Environmental Matters. A Phase I and Phase II environmental
audit of each of the Parcels and the Improvements by the Environmental
Consultant shall have been conducted, at the sole cost and expense of the
Company, and the Agent, the Trustee and the Purchasers shall have received a
copy of the Environmental Consultant's Phase I and Phase II reports, which shall
be in form and substance satisfactory to the Trustee, the Agent and the
Purchasers. No environmental hazard with respect to the Property shall have
arisen, or come to the attention of the Company, since the date of the Phase II.
(m) Appraisal. The Agent shall have received an appraisal of the
Property (the "Appraisal"), satisfactory in form and substance to the Agent and
the Purchasers. Such Appraisal shall be prepared by the Appraiser and shall be
at the expense of the Company.
5
(n) No Material Adverse Event. There shall exist no action, suit,
investigation, litigation or proceeding affecting the Company or any of its
Subsidiaries pending or, to the Company's knowledge, threatened before any
court, governmental agency or arbitrator that could be reasonably likely to have
a Material Adverse Effect.
(o) Recording and Filing. Continuation statements under the UCC
shall have been duly recorded, published, registered and filed by the Agent (or
arrangements for such recording, publishing, registering and filing shall have
been made), in such manner and in such places as the Company, the Company's
counsel, the Agent and Special Counsel shall determine to be necessary or
appropriate to publish notice thereof and protect the validity and effectiveness
thereof and to establish, create, perfect, preserve and protect the rights of
the parties thereto and their respective successors and signs, and all Taxes,
fees and other charges in connection with such recording, publishing,
registration and filing of the Operative Documents or any memoranda thereof and
any financing statements shall have been paid, or caused to be paid, by the
Company.
(p) Satisfaction with Contemplated Transactions. The Agent, the
Trustee and each Purchaser shall be satisfied, each in its sole discretion, with
their review of the Property and all material matters in connection with the
acquisition thereof by the Trustee, including without limitation, the Purchase
Agreement and the Facility Agreements, to the extent available, and each other
contract that is material to the ownership, leasing and operation of the
Property.
(q) Additional Documents. The Agent shall have received such other
approvals, certificates or documents as the Agent may reasonably request to
evidence satisfaction of the conditions set forth in this Section 2.01.
ARTICLE III.
[Intentionally Omitted]
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Company Representations and Warranties. The Company
hereby represents and warrants to the Trustee, the Agent and the Purchasers that
the following shall be true and correct on and as of the Amendment Effective
Date:
(a) Corporate Existence. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Ohio and is duly qualified and authorized to do business in the State of Texas
and, if required, in the State of Connecticut and the Commonwealth of
Pennsylvania.
(b) Corporate and Governmental Authorization; No Contravention. The
execution, delivery and performance by the Company of this Agreement and the
other Operative Documents to which it is a party are within the Company's
corporate powers, have been duly authorized by all necessary corporate action,
require no action by or in respect of, or filing with, any governmental body,
agency or official and do not contravene, or constitute a default under, any
provision of applicable Law or of the articles of incorporation or code of
regulations of the
6
Company or of any agreement, judgment, injunction, order, decree or other
instrument binding upon the Company or result in the creation or imposition of
any lien on any asset of the Company (except as contemplated by the Operative
Documents) or its Subsidiaries, except where such contravention, default or lien
would not result in a Material Adverse Effect.
(c) Binding Effect. This Agreement and the other Operative Documents
to which the Company is a party are legal, valid and binding obligations of the
Company enforceable against the Company in accordance with their respective
terms.
(d) Financial Information. (i) The consolidated balance sheet of the
Company and its Consolidated Subsidiaries as of December 31, 1999, and the
related consolidated statements of income and cash flows for the fiscal year
then ended, reported on by KPMG Peat Marwick LLP and set forth in the Company's
annual report for the fiscal year ended December 31, 1999 as filed with the
Securities and Exchange Commission (the "Commission") on Form 10-K and the
consolidated balance sheet of the Company and its Consolidated Subsidiaries as
at June 30, 2000 and the related consolidated statements of income and cash
flows of the Company and its Consolidated Subsidiaries for the six months then
ended, duly certified by a financial officer of the Company, copies of which
have been delivered to each of the Note and Certificate Purchasers, fairly
present, in conformity with GAAP, the consolidated financial position of the
Company and its Consolidated Subsidiaries as of such dates and their
consolidated results of operations and changes in financial position for such
periods.
(ii) Since December 31, 1999, there has been no Material
Adverse Change.
(e) Litigation. There is no pending or threatened action, suit,
investigation, litigation or proceeding, including, without limitation, any
Environmental Action, affecting the Company or any of its Subsidiaries before
any court, governmental agency or arbitrator that (i) could be reasonably likely
to have a Material Adverse Effect or (ii) purports to affect the legality,
validity or enforceability of this Agreement or any of the Operative Documents
or the consummation of the transactions contemplated hereby.
(f) Compliance with ERISA, etc.
(i) No ERISA Event has occurred or is reasonably expected to
occur with respect to any Plan.
(ii) Neither the Company nor any ERISA Affiliate has incurred
or is reasonably expected to incur any Withdrawal Liability to any Multiemployer
Plan.
(iii) Neither the Company nor any ERISA Affiliate has been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or has been terminated, within the meaning of Title IV of
ERISA, and no such Multiemployer Plan is reasonably expected to be in
reorganization or to be terminated, within the meaning of Title IV of ERISA.
(iv) Except as set forth in the financial statements referred
to in Section 4.01(d), the Company and its Subsidiaries have no material
liability with respect to "expected post
7
retirement benefit obligations" within the meaning of Statement of Financial
Accounting Standards No. 106.
(g) Subsidiaries. Each of the Company's Subsidiaries is a
corporation duly incorporated, validly existing and in good standing, in each
case under the laws of its jurisdiction of incorporation, except where failure
to do so would not constitute a Material Adverse Effect.
(h) Status. The Company is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended, nor is it subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act or the Interstate Commerce Act, or under any other state or Federal
Law limiting its ability to execute and deliver any Operative Document or
perform its obligations thereunder.
(i) Use of Proceeds. The Company, as the Construction Agent, has
used the proceeds of the Advances received by it solely to pay Actual Project
Costs, and none of such proceeds have been used in violation of any applicable
Law, including, without limitation, Regulation G, Regulation T, Regulation U and
Regulation X.
(j) No Default. No event has occurred and no condition exists which
constitutes a Default or an Event of Default.
(k) Consents. The execution and delivery by the Company of each
Operative Document to which it is a party and any other agreement which it has
entered into in connection with the transactions contemplated thereby, the
consummation of the transactions contemplated thereby and its compliance with
the terms thereof does not require the consent or the approval or authorization
of, or filing, registration or qualification with, any Federal, state or local
government on the part of the Company as a condition to such execution, delivery
and compliance.
(1) Title to the Parcels.
(i) The Trustee has good and marketable title to an
indefeasible fee estate in each of the Fee Parcels, subject to no Liens other
than Permitted Encumbrances.
(ii) The Trustee has good and marketable title to the easement
interests in each of the Ohio Easement Parcel, the Texas Leasehold Parcel and
the Texas Easement Parcels subject to no Liens other than Permitted
Encumbrances.
(iii) Neither the Fee Parcels, the Easement Parcels nor the
Property contain any defect or feature making them unsuitable for the proper
operation of the Improvements.
(m) Compliance with Law. Except as referenced in Section 4.01(r) and
Schedule 4.01(r), the Company is in material compliance with all Laws (including
all Environmental Laws) with respect to the Parcels or the Property or with
respect to its leasing and operation of the Property, the construction of the
Improvements or the conduct of its business on the Property. The Company has not
received any notice of, or citation for, any violation of any Law or any
Environmental Action which has not been resolved or which the Company reasonably
8
believes can not be resolved in the ordinary course of business, which notice or
citation or Environmental Action relates to the ownership or operation of the
Parcels or the Property.
(n) Recordation. The Deeds, the ▇▇▇▇ of Sale, the Easement, the
Second Easement, and the Lease (or a memorandum thereof), and the financing and
continuation statements have been recorded or filed in each place in which
recording or filing is required to publish notice, under Texas and Ohio Law, of
the interests created thereby and to protect the validity and effectiveness
thereof
(o) [Intentionally omitted]
(p) Rights to Property; Etc. (i) The Conveyance Documents conveyed
to the Trustee all rights-of-way, easements and real property licenses,
environmental allowances, rights in real property (including, without
limitation, fixtures and appurtenances), utilities and other services necessary
for the day-to-day operation of the Property and (A) such rights-of-way,
easements, licenses, environmental allowances, utilities and other services are
valid and in full force and effect in accordance with their terms, (B) there is
presently no material default with respect to any such rights-of-way, easements,
licenses, utilities and other services, and (C) all utility services necessary
for the operation of the Property for its intended purposes are available at the
boundaries of the Parcel.
(ii) None of the Permitted Encumbrances will interfere with
the use or possession of the Property or any other material asset used in
connection therewith or the use of or the exercise by the Trustee of its rights
either under any Operative Document or to the Property.
(iii) The Company has given any and all notices required to be
given in connection with the construction of the Improvements pursuant to any
easements, rights-of-way, licenses or other agreements affecting the Parcel or
the Property, or any part thereof
(iv) The Improvements are situated wholly within the boundary
lines of the Texas Fee Parcels, the Texas Easement Parcels or the Ohio Fee
Parcels, as the case may be, and do not encroach upon any contiguous or
adjoining property; neither Parcel is considered part of a larger zoning or tax
lot; the Improvements do not encroach on any easements or rights-of-way
affecting the Property (except as specifically described in one of the Title
Policies), or violate any rights granted thereunder or any covenants or
restrictions affecting the Property, or any part thereof, and any future
violation will not result in a reversion or forfeiture of title, right of
re-entry or power of termination; and the easements, rights-of-way, covenants
and restrictions affecting the Property will not interfere with the use or
occupancy of the Property or any part thereof, or any asset owned or used in
connection therewith, nor will the exercise of rights or remedies thereunder
result in any damage to the Improvements or diminution of value of the Property,
or any part thereof.
(q) Trade Secrets and Patents. (i) The ownership of the Property by
the Trustee and the leasing and operation of the Property by the Company,
including the construction and proposed operation of the Improvements, do not
and will not conflict with, infringe on, or otherwise violate any copyright,
trade secret or patent rights of any other Person.
9
(ii) The Company has all rights to all patents, patent
applications, proprietary computer software, "know-how" and copyrights used or
to be used in the ordinary course of the construction and operation of the
Improvements (the "Intellectual Property Rights") that are necessary for the
operation thereof, including the right to assign the Intellectual Property
Rights. There is no judicial proceeding pending (or, to the knowledge of the
Company, threatened) involving any claim of any infringement, misuse or
misappropriation by the Company or any Affiliate thereof of any patent,
copyright, license or similar intellectual property right owned by any third
party related to the Intellectual Property Rights.
(r) Environmental Compliance. (i) Except as may be disclosed in the
Company's Annual Report for the year ended December 31, 1999 as filed with the
Securities and Exchange Commission on March 29, 2000, and except where
noncompliance would not reasonably be expected to have a Material Adverse
Effect, the operations and properties of the Company (other than the Property)
and each of its Subsidiaries comply in all material respects with all
Environmental Laws, all necessary Environmental Permits have been obtained and
are in effect for the operations and properties of the Company and its
Subsidiaries, the Company and its Subsidiaries are in compliance in all material
respects with all such Environmental Permits, and no circumstances exist that
could be reasonably likely to (A) form the basis of an Environmental Action
against the Company or any of its Subsidiaries or any of their properties that
could have a Material Adverse Effect or (B) cause any such property to be
subject to any restrictions on ownership, occupancy, use or transferability
under any Environmental Law that could have a Material Adverse Effect. Except as
set forth on Schedule 4.0 1(r), the Property complies in all material respects
with all Environmental Laws; all necessary Environmental Permits have been
obtained and are in effect for the Property and no circumstances exist that
could be reasonably likely to (A) form the basis of an Environmental Action
against the Property or (B) cause the Property to be subject to any restrictions
on ownership, occupancy, use or transferability under any Environmental Law.
(ii) Except as set forth in this Section 4.01(r) or on
Schedule 4.01(r), none of the properties currently or formerly owned or operated
by the Company (other than the Property) or any of its Subsidiaries is listed or
proposed for listing on the National Priorities List under the CERCLA ("NPL")or
on CERCLIS or any analogous state list of sites requiring investigation or
cleanup, the listing, or proposed listing of which would be reasonably likely to
have a Material Adverse Effect. The Property is not listed or proposed for
listing on the NPL or on CERCLIS or any analogous state list of sites requiring
investigation or cleanup.
(iii) Except where noncompliance would not individually or in
the aggregate have a Material Adverse Effect, (A) neither the Company nor any of
its Subsidiaries has transported or arranged for the transportation of any
Hazardous Materials to any location that is listed or proposed for listing on
the NPL or on the CERCLIS or any analogous state list, and (B) all Hazardous
Materials generated, used, treated, handled or stored at or transported to or
from any property currently or formerly owned or operated by the Company or any
of its Subsidiaries have been disposed of in compliance with all Environmental
Laws and Environmental Permits. Except as set forth in this Section 4.01(r) or
on Schedule 4.0 1(r), all Hazardous Materials generated, used, treated, handled
or stored at or transported to or from the Property have been disposed of in
compliance with all Environmental Permits.
10
(s) No Condemnation or Casualty. The Property has not suffered a
Condemnation or a Casualty or any other damage or destruction which renders the
Property unusable in whole or in material part, and, under applicable Law, the
Property may be used for the purposes contemplated by the Company in accordance
with the Lease.
(t) Permits. All Permits (including Environmental Permits) that are
or will become Applicable Permits have been obtained. All such obtained Permits
are in proper form, in full force and effect and not subject to any further
appeal or further contest or to any unsatisfied condition (other than conditions
relating to completion in the future) that may allow modification or revocation.
(u) Insurance. The Company is in compliance with all Insurance
Requirements, and all insurance policies required by paragraph 16 of the Lease
are in full force and effect.
(v) Taxes. All Taxes (other than Excluded Charges), fees and other
charges which have become due and payable in connection with the execution and
delivery of the Operative Documents or any memorandum thereof have been paid.
(w) Compliance. The Property is in material compliance with all
existing applicable Laws.
(x) No Material Adverse Event. No applicable Law prohibits, and no
litigation, governmental investigation or other proceeding is pending or, to the
Company's knowledge, threatened in which there is a reasonable possibility of an
unfavorable judgment, decree, order or other determination which could prevent
or make unlawful, or impose any material adverse condition upon, the Property or
the acquisition, construction, use, ownership, operation or leasing thereof, or
the Trustee's ownership thereof.
(y) Full Disclosure. The statements and materials furnished by or on
behalf of the Company to the Agent, any Note and/or Certificate Purchaser, the
Trustee or Special Counsel, in connection with any Operative Document or any
transaction contemplated thereby do not contain any untrue statement of a
material fact or omit a material fact necessary to make the statements contained
therein or herein not misleading in light of the circumstances in which such
statements or materials were furnished.
SECTION 4.02. SSBTC Representations and Warranties. SSBTC, in its
individual capacity and not as Trustee, represents and warrants (with the
exception of subsection (g), which representation and warranty is made by SSBTC
solely in its trust capacity) to the Company and the Purchasers that the
following statements are and shall be true and correct as of the Amendment
Effective Date:
(a) Organization and Authority. (i) SSBTC is a Massachusetts trust
company duly organized, validly existing and in good standing under the laws of
the Commonwealth of Massachusetts.
11
(ii) SSBTC has all requisite power and authority to execute
and deliver each Operative Document to which it is a party and to comply with
the terms thereof and perform its obligations thereunder.
(b) Pending Litigation. There are no actions, suits or Proceedings
pending or threatened against or affecting SSBTC in any court or before any
governmental body or arbitration tribunal which, if adversely determined, would
adversely affect the Trustee's ownership of the Property or the business,
condition (financial or otherwise), performance, properties, prospects or
results of operation of SSBTC or the Trustee's ability to perform its
obligations as Trustee under any Operative Document to which it is a party or
any other agreement which it has entered into in connection with any transaction
contemplated by any Operative Document.
(c) Authorization; No Conflict. The execution and delivery by SSBTC
of, and compliance by SSBTC with all of the provisions of, each Operative
Document to which it is a party and any other agreement entered into in
connection with any transaction contemplated by the Operative Documents are
within the powers of SSBTC and are authorized by SSBTC and will not conflict
with, result in any breach of any of the provisions of, or constitute a default
under, SSBTC's articles of association or by-laws or any agreement, judgment,
injunction, order, decree or other instrument to which SSBTC is a party or by
which SSBTC may be bound or which is applicable to any of SSBTC's property or
result in a violation of any applicable Massachusetts or Federal Law or in the
creation of any lien on any asset of SSBTC (except as contemplated by the
Operative Documents).
(d) Enforceability. Each of the Operative Documents to which SSBTC
is a party, and any other agreement entered into by SSBTC in connection with any
transaction contemplated by any Operative Document, has been duly authorized by
all necessary action on the part of SSBTC, and is the legal, valid and binding
obligation of SSBTC enforceable against SSBTC in accordance with its terms,
except as enforceability thereof may be limited by the effect of any applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally and by general principles of equity.
(e) No Default. No event has occurred and no condition exists
which,. upon consummation of the transactions contemplated by any Operative
Document, would constitute a default by SSBTC. SSBTC is not in violation in any
respect of any agreement or any other instrument, nor is SSBTC in violation of
its articles of association or any other instrument to which it is a party or by
which it or any of its property may be bound or affected which would have a
material adverse effect on either the business, financial position or results of
operations of SSBTC or SSBTC's ability to perform its obligations as Trustee
under the Operative Documents.
(f) Consents. The nature of SSBTC, its execution and delivery of
each Operative Document to which it is a party, its consummation of the
transactions contemplated thereby, its compliance with the terms thereof or any
circumstance in connection with the transactions contemplated thereby does not
require the consent of any Person or the approval or authorization of, or
filing, registration or qualification with, any Massachusetts or Federal
governmental authority governing the banking or trust powers of SSBTC on the
part of SSBTC (other than such as have been obtained) as a condition to such
execution, delivery and compliance.
12
(g) Enforceability Against Trustee. As of the Financing Closing Date
the Instruments have been duly authorized by all necessary corporate action on
the part of the Trustee and the Instruments (other than the Series 2 A-Notes and
Series 2 B-Notes) constitute, and (upon issuance) the Series 2 A-Notes and
Series 2 B-Notes will constitute, the legal, valid and binding obligations of
the Trustee (acting solely as Trustee under the Declaration, and not in its
individual capacity) and are, or (as applicable) will be, enforceable against
the Trustee in accordance with their terms and the terms of the Declaration.
ARTICLE V.
COVENANTS
SECTION 5.01. Company's Covenants.
(a) Information. The Company will deliver to the Agent for
distribution to the Note and Certificate Purchasers:
(i) as soon as available and in any event within 60 days after
the end of each of the first three quarters of each fiscal year of the
Company, consolidated balance sheets of the Company and its Subsidiaries
as of the end of such quarter and consolidated statements of income and
retained earnings and cash flows of the Company and its Subsidiaries for
the period commencing at the end of the previous fiscal year and ending
with the end of such quarter, certified by the chief financial officer of
the Company;
(ii) as soon as available and in any event within 120 days
after the end of each fiscal year of the Company, a copy of the annual
report for such year for the Company and its Subsidiaries, containing
consolidated financial statements for such year certified in a manner
acceptable to the Majority Purchasers by KPMG Peat Marwick or other
independent public accountants acceptable to the Majority Purchasers,
together with a certificate of such accountants stating that during the
course of their examination no Default or Event of Default existing at the
end of such fiscal year came to their attention or, if any did come to
their attention, briefly describing the same;
(iii) together with each delivery pursuant to clause (i) or
(ii) above, a certificate of an appropriate financial officer of the
Company setting forth the computations showing compliance or
non-compliance, as the case may be, with the covenants in Section 5.01(i)
which certificate shall be in form and detail reasonably satisfactory to
the Purchasers and shall include such officer's certification that he
knows of no Default or Event of Default then existing or, if any does
exist, a brief description thereof and of the Company's intentions in
respect thereof;
(iv) as soon as possible and in any event within five days
after the occurrence of each Default and Event of Default continuing on
the date of such statement, a statement of the chief financial officer of
the Company setting forth details of such Default or Event of Default and
the action which the Company has taken and proposes to take with respect
thereto;
(v) promptly after the sending or filing thereof, copies of
(A) each Form 10-K, Form l0-Q, Form 8-K or similar document filed by the
Company with the Securities and
13
Exchange Commission, (B) each effective registration statement or
generally distributed preliminary prospectus filed by the Company with the
Securities and Exchange Commission, but not including any relating solely
to employee benefit plans, and (C) each proxy statement, annual or
quarterly report or other document sent by the Company to holders of its
common stock;
(vi) promptly and in any event within ten business days after
the receipt thereof by the Company or any of its Subsidiaries, a copy of
each notice, citation or other communication from the United States
Environmental Protection Agency, any state environmental protection
agency, any court or any other governmental Person, and of each consent
agreement, consent decree, judgment or other document with any such
Person, in each case asserting an actual or potential violation, fine,
penalty, enforcement action or liability of the Company or any Subsidiary
under any law or regulation relating to environmental protection,
hazardous or toxic substances or contaminated materials, the effect or
adverse determination of which would have a Material Adverse Effect;
(vii) promptly after the commencement thereof, notice of the
commencement and nature of all actions and proceedings before any court,
governmental agency or arbitrator affecting the Company or any of its
Subsidiaries of the type described in Section 4.01(e);
(viii) promptly and in any event within 15 days after the
Company or any of its ERISA Affiliates knows or has reason to know that
any ERISA Event has occurred, a statement of an officer of the Company
having knowledge of or responsibility for such matters describing such
ERISA Event and the action, if any, that the Company or such ERISA
Affiliate has taken and proposes to take with respect thereto;
(ix) promptly and in any event within seven Business Days
after receipt thereof by the Company or any of its ERISA Affiliates,
copies of each notice from the PBGC stating its intention to terminate any
Plan or to have a trustee appointed to administer any such Plan;
(x) promptly and in any event within 30 days after the receipt
thereof by the Company or any of its ERISA Affiliates, a copy of the
latest annual actuarial report for each Plan if the ratio of the fair
market value of the assets of such Plan to its current liability (as
defined in Section 412 of the Code) is less than 60%;
(xi) promptly and in any event within five Business Days after
receipt thereof by the Company or any of its ERISA Affiliates from the
sponsor of a Multiemployer Plan, copies of each notice concerning (A) the
imposition of Withdrawal Liability by any such Multiemployer Plan, (B) the
reorganization or termination, within the meaning of Title IV of ERISA, of
any such Multiemployer Plan or (C) the amount of liability incurred, or
that may be incurred, by the Company or any of its ERISA Affiliates in
connection with any event described in clause (A) or (B); and
14
(xii) such other information respecting the condition or
operations, financial or otherwise, of the Company or any of its
Subsidiaries as any Purchaser or the Trustee through the Agent may from
time to time reasonably request.
(b) Compliance with Environmental Laws. The Company will comply, and
cause other Persons operating or occupying its properties to comply, in all
material respects, with all applicable Environmental Laws now existing or
hereinafter enacted and Environmental Permits with respect to the Property;
obtain and renew all Environmental Permits necessary for ownership and operation
of the Property; and conduct any investigation, study, sampling and testing, and
undertake any cleanup, removal, remedial or other action necessary to remove and
clean up all Hazardous Materials from any of the Property pursuant to the lawful
order of any regulatory authority and generally in accordance with the
requirements of all Environmental Laws, except to the extent that such
compliance with Environmental Laws is being contested in good faith and by
appropriate proceedings and for which adequate reserves have been established to
the extent required by GAAP, and an adverse outcome in such proceedings is not
reasonably expected to have a Material Adverse Effect.
(c) Maintenance of Property; Insurance; As-Built Survey. (i) The
Company will keep, and will cause each of its Subsidiaries to keep, all property
used or useful in its business in good working order and condition, ordinary
wear and tear excepted, except where the failure to do so would not have a
Material Adverse Effect.
(ii) The Company will, and will cause each of its Subsidiaries
to, maintain (either in the name of the Company or in such Subsidiary's own
name) with insurance companies, insurance on all of its properties in at least
such amounts and against at least such risks (and with such risk retention) as
the Company in good faith determines is necessary or appropriate for the prudent
management of its business; and will furnish to the Purchasers, upon request
from the Agent, information presented in reasonable detail as to the insurance
so carried.
(iii) The Company will deliver to the Agent promptly after the
occurrence of the Final Completion Date, the final as-built plans and
specifications of the Improvements (which in any event shall be provided to
Agent within ninety (90) days after the Final Completion Date).
(d) Conduct of Business and Maintenance of Existence. (i) Neither
the Company nor any of its Subsidiaries will engage in any business if, as a
result, the general nature of the business, taken on a consolidated basis, which
would then be engaged in by the Company and its Subsidiaries, would be
substantially changed from the general nature of the business engaged in by the
Company and its Subsidiaries on the date hereof, and the Company will preserve,
renew and keep in full force and effect its rights, privileges and franchises
necessary or desirable in the normal conduct of its business to the extent
permitted by Law, unless the loss of any such rights, privileges or franchises
could not reasonably by expected to have a Material Adverse Effect.
(ii) The Company will preserve and keep in full force and
effect its corporate existence.
15
(e) Compliance with Laws. The Company will comply, and cause each of
its Subsidiaries to comply, in all material respects with all applicable Laws,
if non-compliance would have a Material Adverse Effect; such compliance shall
include, without limitation, paying before the same become delinquent all taxes,
assessments and governmental charges imposed upon it or upon its property;
provided, however, that in the event of any alleged non-compliance, no such
Person shall be in violation of this subsection: (i) if within thirty (30) days
after such noncompliance becomes apparent or is alleged, appropriate corrective
measures are commenced and such measures are diligently pursued to the
satisfaction of the applicable court, agency or governmental authority; or (ii)
if and as long as such alleged non-compliance is being contested in good faith
by timely and appropriate proceedings.
(f) Books and Records. The Company will keep, and cause each of its
domestic Subsidiaries to keep, proper books of record and account in which
entries in conformity with GAAP shall be made of all financial transactions and
the assets and business of the Company and each such domestic Subsidiary.
(g) Survey. The Company shall deliver to the no later than December
15, 2000 a current, accurate "as built" survey of each of the Parcels showing
the location of all Improvements, easements, encroachments and other survey
matters, dated a recent date, in form and substance satisfactory to the Agent,
prepared by licensed surveyors acceptable to the Agent, which survey is
certified to the Company, the Trustee, the Agent and the Note and Certificate
Purchasers.
(h) [Intentionally Omitted.]
(i) (i) Consolidated Total Debt/Consolidated EBITDA Ratio. The
Company will not at any time permit the ratio of (x) the amount of Consolidated
Total Debt at such time to (y) Consolidated EBITDA for its then most recent
Testing Period, to exceed 3.25 to 1.00.
(ii) Interest Coverage Ratio. The Company will not permit the
ratio of (x) Consolidated EBITDA for any Testing Period, to (y)
Consolidated Interest Expense for such Testing Period, to be less than
4.00 to 1.00.
(j) Consolidation, Merger, Asset Sales, etc. The Company will not,
and will not permit any Subsidiary to, (i) enter into any transaction of merger
or consolidation, (ii) sell all or substantially all of its property and
business, (iii) otherwise make or effect any Asset Sale, or (iv) agree to do any
of the foregoing at any future time, except that the following shall be
permitted:
(A) Certain Intercompany Mergers, etc. If no Default or Event
of Default shall have occurred and be continuing or would result
therefrom:
(1) the merger, consolidation or amalgamation of any
Subsidiary of the Company with or into the Company; provided
the Company is the surviving or continuing or resulting
corporation;
16
(2) the merger, consolidation or amalgamation of any
Subsidiary of the Company with or into another Subsidiary of
the Company; provided that the surviving or continuing or
resulting corporation is a Wholly-Owned Subsidiary of the
Company, and provided, further, that if any such Subsidiary is
a guarantor under the Subsidiary Guaranty, the surviving or
continuing or resulting corporation is or contemporaneously
therewith becomes a guarantor under the Subsidiary Guaranty;
(3) the liquidation, winding up or dissolution of any
Subsidiary of the Company;
(4) the making of any Asset Sale by the Company to any
Wholly-Owned Subsidiary;
(5) the making of any Asset Sale by any Subsidiary to
the Company or any other Wholly-Owned Subsidiary of the
Company; and
(6) the making of any Asset Sale by any Subsidiary of
the Company to any Wholly-Owned Subsidiary of the Company,
provided that if the selling Subsidiary is a guarantor under
the Subsidiary Guaranty the purchasing Subsidiary must be, or
contemporaneously become, a guarantor under the Subsidiary
Guaranty;
shall each be permitted.
(B) Other Mergers, etc. Involving the Company. The Company may
consolidate or merge with any other corporation, or sell, transfer or otherwise
dispose of all or substantially all of the property and assets of the Company
and its Subsidiaries as an entirety to any acquiring Person, if (1) the
surviving, continuing or resulting corporation of such merger or consolidation
(if other than the Company) or the acquiring Person, is a corporation,
partnership or limited liability company formed under the laws of one of the
States of the United States or the District of Columbia and unconditionally
assumes the obligations of the Company under the Operative Documents pursuant to
an assumption agreement delivered to the Agent contemporaneously with the
consummation of such transaction and in form and substance reasonably
satisfactory to the Majority Purchasers, (2) no Event of Default has occurred
and is continuing or would result therefrom, (3) no Change of Control would be
occasioned thereby, and (4) the Consolidated Net Worth of the surviving,
continuing or resulting corporation of such merger or consolidation or the
acquiring Person, as applicable, is at least 95% of the Consolidated Net Worth
of the Company as of the end of its most recent fiscal quarter ended prior to
the date such transaction is consummated.
(C) Asset Sales in Permitted Receivables Programs. The Company
or any of its Subsidiaries may make any Asset Sale consisting of trade
receivables and related collateral, credit support and similar rights, pursuant
to one or more receivables programs, to a Person who is not a Subsidiary of the
Company; provided that (1) the consideration to be received by the Company and
its Subsidiaries for any such Asset Sale consists of cash; (2) no Default or
Event of Default shall have occurred and be continuing or would result
therefrom; and (3) the
17
aggregate outstanding balance of the trade receivables subject to all such
programs at any point in time is not in excess of $150,000,000 (collectively the
"Permitted Receivables Programs").
(D) Other Permitted Asset Sales. In addition to the Asset
Sales permitted in Section 5.01 (j)(C) above, if no Default or Event of Default
shall have occurred and be continuing or would result therefrom, the Company or
any of its Subsidiaries may make any other Asset Sale to a Person who is not a
Subsidiary of the Company; provided that,
(1) in the case of any such Asset Sale or related series
of Asset Sales where the fair value (as determined by
management of the Company) of the property covered thereby
exceeds $50,000,000 in the aggregate, at least 75% of the
consideration to be received by the Company and its
Subsidiaries consists of cash;
(2) the cumulative aggregate consideration for all such
Asset Sales completed during the calendar year ended December
31, 2000, or any subsequent calendar year, does not exceed
$125,000,000 in the case of any such calendar year; and
(3) in the case of any such transaction involving
consideration in excess of $50,000,000, at least five Business
Days prior to the date of completion of such transaction the
Company shall have delivered to the Agent an officer's
certificate executed on behalf of the Company by an Authorized
Officer of the Company, which certificate shall contain (a) a
description of the proposed transaction, the date such
transaction is scheduled to be consummated, and the estimated
purchase price or other consideration for such transaction,
(b) a certification that no Default or Event of Default has
occurred and is continuing, or would result from consummation
of such transaction, and (c) which shall (if requested by the
Agent) include a certified copy of the draft or definitive
documentation pertaining thereto.
For the avoidance of doubt, no amounts in respect of Asset
Sales made in Permitted Receivables Programs pursuant to Section
5.01(j)(C) shall be included in any dollar computations pursuant to this
Section 5.01(j)(D).
Without limitation of the foregoing, the Company will not directly or indirectly
use any proceeds of borrowings under the Company's Credit Agreement to finance
an Acquisition which is actively opposed by the Board of Directors (or similar
governing body) of the selling Person or the Person whose equity interests are
to be acquired, unless all of the Purchasers specifically approve or consent of
such Acquisition in writing.
(k) Fiscal Years, Fiscal Quarters. If the Company shall change any
of its or any of its Subsidiaries' fiscal years or fiscal quarters (other than
the fiscal year or fiscal quarters of a Person which becomes a Subsidiary, made
at the time such Person becomes a Subsidiary to conform to the Company's fiscal
year and fiscal quarters), the Company will promptly, and in any
18
event within 30 days following any such change, deliver a notice to the Agent
and the Purchasers describing such change and any material accounting entries
made in connection therewith and stating whether such change will have any
impact upon any financial computations to be made hereunder, and if any such
impact is foreseen, describing in reasonable detail the nature and extent of
such impact. If the Majority Purchasers determine that any such change will have
any impact upon any financial computations to be made hereunder which is adverse
to the Purchasers, the Company will, if so requested by the Agent, enter into an
amendment to this Agreement, in form and substance reasonably satisfactory to
the Agent and the Majority Purchasers, modifying any of the financial covenants
or related provisions hereof in such manner as the Majority Purchasers determine
is necessary to eliminate such adverse effect.
(l) Performance. The Company shall observe and perform all
provisions to be observed or performed by it contained in each Operative
Document to which it is a party, in accordance with the terms thereof and within
the times permitted thereby (including any grace or cure periods provided
thereby) so as to prevent the occurrence of an Event of Default, and will
maintain, or cause to be maintained, the validity and effectiveness as to the
Company of each such Operative Document to which it is a party.
(m) Intellectual Property Rights. The Company shall preserve,
protect and maintain its rights in and to the Intellectual Property Rights in
accordance with prudent industry practice.
(n) [Intentionally Omitted.]
(o) [Intentionally Omitted]
(p) Restrictions on Secured Debt. The Company will not itself, and
will not permit any Domestic Subsidiary to, incur, issue, assume or guarantee
any indebtedness for money borrowed represented by notes, bonds, debentures or
other similar evidences of indebtedness for money borrowed (such notes, bonds,
debentures or other similar evidences of indebtedness for money borrowed being
hereinafter called "Debt"), secured by a Mortgage on any Principal Domestic
Manufacturing Property of the Company or any Domestic Subsidiary, or any shares
of stock or Debt of any Domestic Subsidiary, without effectively providing that
the obligations of the Company under the Operative Documents (together with, if
the Company shall so determine, any other Debt of the Company or such Domestic
Subsidiary then existing or thereafter created which is not subordinate to the
obligations under the Operative Documents) shall be secured equally and ratably
with (or prior to) such secured Debt, so long as such secured Debt shall be so
secured, unless, after giving effect thereto, the aggregate amount of all such
secured Debt plus all Attributable Debt of the Company and its Domestic
Subsidiaries in respect of sale and leaseback transactions (as defined in
Section 5.01(q)) would not exceed 10% of Consolidated Net Tangible Assets;
provided, however, that this Section 5.01(p) shall not apply to, and there shall
be excluded from secured Debt in any computation under this Section 5.01(p),
Debt secured by:
(i) Mortgages on property of, or on any shares of stock or
Debt of, any corporation existing at the time such corporation becomes a
Domestic Subsidiary;
(ii) Mortgages in favor of the Company or any Domestic
Subsidiary;
19
(iii) Mortgages on property of the Company or a Domestic
Subsidiary in favor of the United States of America or any State thereof,
or Puerto Rico, or any department, agency or instrumentality or political
subdivision of the United States of America or any State thereof, or
Puerto Rico, or in favor of any other country, or any political
subdivision thereof, to secure partial, progress, advance or other
payments pursuant to any contract or statute;
(iv) Mortgages on property, shares of stock or Debt existing
at the time of acquisition thereof (including acquisition through merger
or consolidation) or to secure the payment of all or any part of the
purchase price or construction or improvement cost thereof or to secure
any Debt incurred prior to, at the time of, or within 120 days after, the
acquisition of such property or shares or Debt or the completion of any
such construction or improvement for the purpose of financing all or any
part of the purchase price or construction or improvement cost thereof
(v) Mortgages securing obligations issued by a State,
territory or possession of the United States, any political subdivision of
any of the foregoing, or the District of Columbia, or any instrumentality
of the foregoing to finance the acquisition or construction or property,
and on which the interest is not, in the opinion of tax counsel of
recognized standing or in accordance with a ruling of the Internal Revenue
Service, includable in gross income of the holder by reason of section 1
03(a)( 1) of the Internal Revenue Code (or any successor to such provision
as in effect at the time of issuance of such obligations); and
(vi) any extension, renewal or replacement (or successive
extensions, renewals or replacements), as a whole or in part, of any Debt
secured by any Mortgage referred to in the foregoing clauses (i) to (v),
inclusive; provided, that (A) such extension, or replacement Mortgage
shall be limited to all or a part of the same property, shares of stock or
Debt that secured the Mortgage extended, renewed or replaced (plus
improvements on such property) and (B) the Debt secured by such Mortgage
at such time is not increased.
(q) Limitation on Sales and Leasebacks. The Company will not itself,
and it will not permit any Domestic Subsidiary to, enter into any arrangement
with any bank, insurance company or other lender or investor (not including the
Company or any Subsidiary) or to which any such lender or investor is a party,
providing for the leasing by the Company or any Domestic Subsidiary for a
period, including renewals, in excess of three years of any Principal Domestic
Manufacturing Property which has been or is to be sold or transferred, more than
120 days after the acquisition thereof or the completion of construction and
commencement of full operation thereof, by the Company or any Domestic
Subsidiary to such lender or investor or to any Person to whom funds have been
or are to be advanced by such lender or investor on the security of such
Principal Domestic Manufacturing Property (herein referred to as a "sale and
leaseback transaction") unless either:
(i) the Company or such Domestic Subsidiary could create Debt
secured by a Mortgage pursuant to Section 5.01(p) on the Principal
Domestic Manufacturing Property to be leased back in an amount equal to
the Attributable Debt with
20
respect to such sale and leaseback transaction without equally and ratably
securing the obligations of the Company under the Operative Documents; or
(ii) the Company within 120 days after the sale or transfer
shall have been made by the Company or by any such Domestic Subsidiary,
applies an amount equal to the greater of (A) the net proceeds of the sale
of the Principal Domestic Manufacturing Property sold and leased back
pursuant to such arrangement or (B) the fair market value of the Principal
Domestic Manufacturing Property so sold and leased back at the time of
entering into such arrangements (as determined by any two of the
following: the Chairman of the Board of the Company, its President, any
Vice President, Finance of the Company, its Treasurer and its Controller)
to the retirement of Funded Debt of the Company which is pari passu with
the obligations of the Company under the Operative Documents; provided,
that the amount to be applied to the retirement of Funded Debt of the
Company shall be reduced by (1) the amount by which the general revolving
commitments of the lenders under the Company's Credit Agreement as set
forth on Annex I thereof were permanently reduced during the 120 days
after such sale, if any such reduction in fact occurred, and (2) the
principal amount of such Funded Debt, other than obligations of the
Company under the Operative Documents, voluntarily retired by the Company
within 120 days after such sale. Notwithstanding the foregoing, no
retirement referred to in this clause (ii) may be effected by payment at
maturity or pursuant to any mandatory sinking fund payment or any
mandatory prepayment provision.
(r) Indebtedness. The Company will not, and will not permit any of
its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness of the Company or any of its Subsidiaries, except:
(i) Operative Documents. Indebtedness incurred under the
Company's Credit Agreement;
(ii) Existing Indebtedness. Existing Indebtedness, and any
refinancing, extension, renewal or refunding of any such Existing
Indebtedness not involving an increase in the principal amount thereof or
a reduction of more than 10% in the remaining weighted average life to
maturity thereof (computed in accordance with standard financial
practice); provided that any Existing Indebtedness identified in Annex III
to the Company's Credit Agreement or otherwise referred to in section 6.1
thereof as being intended to be refinanced by loans thereunder or
otherwise retired, may not be otherwise refinanced;
(iii) Intercompany Debts. (A) unsecured Indebtedness of the
Company owed to any of its Subsidiaries; and (B) Indebtedness of any of
the Company's Subsidiaries owed to the Company or to another Subsidiary of
the Company;
(iv) Hedge Agreements. Indebtedness of the Company and its
Subsidiaries under Hedge Agreements; and
(v) Additional Indebtedness and Guaranty Obligations.
Additional Indebtedness and Guaranty Obligations of the Company and/or any
of its Subsidiaries, not
21
otherwise permitted pursuant to the foregoing clauses, without limitation
as to aggregate amount; provided that at the time of incurrence thereof
and after giving effect thereto: (A) no Event of Default shall have
occurred and be continuing or shall result therefrom, (B) if such
Indebtedness or Guaranty Obligations is secured by any collateral, such
Indebtedness is permitted by Section 5.0 1(p) and (C) the Company would
have been in compliance with the covenants contained in Sections 5.01
(i)(iv) and 5.01 (i)(v) hereof if such Indebtedness had been incurred at
the beginning of the most recent Testing Period for which financial
information has been furnished to the Purchasers hereunder, and such
Indebtedness remained outstanding throughout such Testing Period.
(s) No Stock Repurchases While Index Debt is Not Investment Grade,
etc. The Company will not, at any time when its Index Debt is not Investment
Grade, directly or indirectly make, or permit any of its Subsidiaries to
directly or indirectly make, any purchase, redemption, retirement or other
acquisition of (i) any shares of capital stock of any class of the Company
(other than for a consideration consisting solely of capital stock of the same
class of the Company); or (ii) any warrants, rights or options to acquire, or
any securities convertible into or exchangeable for, any capital stock of the
Company.
(t) Transactions with Affiliates. The Company will not, and will not
permit any Subsidiary to, enter into any transaction or series of transactions
with any Affiliate (other than, in the case of the Company, any Subsidiary, and
in the case of a Subsidiary, the Company or another Subsidiary) other than in
the ordinary course of business of and pursuant to the reasonable requirements
of the Company's or such Subsidiary's business and upon fair and reasonable
terms no less favorable to the Company or such Subsidiary than would obtain in a
comparable arm's-length transaction with a Person other than an Affiliate,
except agreements and transactions with and payments to employees, officers,
directors, shareholders and other Affiliates which are either (i) entered into
in the ordinary course of business and not prohibited by any of the provisions
of this Agreement, or (ii) entered into outside the ordinary course of business,
approved by the directors or shareholders of the Company, and not prohibited by
any of the provisions of this Agreement.
(u) Plan Terminations, Minimum Funding. etc. The Company will not,
and will not permit any ERISA Affiliate to (i) terminate any Plan or Plans so as
so result in liability of the Company or any ERISA Affiliate to the PBGC in
excess of, in the aggregate, $5,000,000, (ii) permit to exist one or more events
or conditions which reasonably present a material risk of the termination by the
PBGC of any Plan or Plans with respect to which the Company or any ERISA
Affiliate would, in the event of such termination, incur liability to the PBGC
in excess of such amount in the aggregate, or (iii) fail to comply with the
minimum funding standards of ERISA and the Code with respect to any Plan.
22
ARTICLE VI.
THE NOTES AND THE CERTIFICATES
SECTION 6.01. Determination of Rates.
(a) All computations of interest and of any fee payable hereunder or
under any other Operative Document (other than computations made for purposes of
determining the Maximum Rate) shall be made by the Agent on the basis of a year
of 360 days (365 days in the case of the computation of interest if the
Applicable Rate is determined by reference to the Base Rate), for the actual
number of days (including the first day but excluding the last day) occurring in
the period for which such interest or fee is payable. Each determination by the
Agent of an interest rate hereunder or under any other Operative Document shall
be conclusive and binding for all purposes, absent manifest error, but no such
interest rate shall ever exceed the Maximum Rate.
(b) The Company shall notify the Agent two Business Days before each
Interest Setting Date as to the Interest Period or Periods selected by the
Company subject to the limitations set forth in the definition of Interest
Period. On each Interest Setting Date, the Agent shall calculate the LIBO Rate.
Upon determination of the LIBO Rate on the Interest Setting Date, the Agent
shall promptly notify the Purchasers and the Trustee of the LIBO Rate for the
applicable Interest Period.
(c) In the event, and on each occasion, that on the Interest Setting
Date the Agent shall have received notice from any Note Purchaser of such
Purchaser's determination (which determination shall be conclusive and binding
upon the Trustees and the Company absent manifest error) (i) that United States
dollar deposits in the amount of the principal of and for the relevant Interest
Period for such Purchaser's Notes are not generally available in the London
interbank market or (ii) that the rate at which such dollar deposits are being
offered would not adequately and fairly reflect the cost to such Purchaser of
making or maintaining the principal of such Notes during the relevant Interest
Period if the Applicable Rate were to be determined by reference to the LIBO
Rate, then the Agent shall, as soon as practicable thereafter, give written,
telex or facsimile notice of such determination to the Company, the Trustee and
the other Purchasers and in the case of a determination pursuant to clause (ii)
above only, such Purchaser shall deliver a certificate to the Agent and the
Company describing in reasonable detail the calculations of such Purchaser
pursuant to which it made such determination and stating that such Purchaser is
making such determination on a basis consistent with its treatment of other
similar situations, and thereafter the Applicable Rate on the Notes held only by
such Purchaser shall be determined by reference to an appropriate substitute
rate to be negotiated in good faith by the Company, the Agent and such Purchaser
as promptly as practicable or, failing agreement on an appropriate substitute
rate, the Base Rate, but in no event to exceed the Maximum Rate, until the
circumstances giving rise to such notice no longer exist.
(d) In the event, and on each occasion, that on the Interest Setting
Date the Agent shall have determined (which determination shall be conclusive
and binding upon the Company absent manifest error) that reasonable means do not
exist for ascertaining the LIBO Rate for purposes of determining the Applicable
Rate, then the Agent shall, as soon as practicable thereafter, give written,
telex or facsimile notice of such determination to the Company, the
23
Purchasers and the Trustee, and thereafter the Applicable Rate on the
Instruments shall be determined by reference to an appropriate substitute rate
to be negotiated in good faith by the Company, the Agent and the Purchasers (the
"Substitute Rate") as promptly as practicable or, failing agreement on the
Substitute Rate, the Base Rate, but in no event to exceed the Maximum Rate,
until the circumstances giving rise to such notice no longer exist.
(e) In the event that, subsequent to the Financing Closing Date, the
introduction of or any change in any United States or foreign Law, or the
interpretation or application thereof, makes it unlawful, or any central bank or
other governmental authority having jurisdiction asserts that it is unlawful,
for any Purchaser (including any branch, subsidiary or Affiliate office of such
Purchaser from which the Instruments are actually funded or at which the
Instruments are actually maintained or held) to find or maintain and/or to
continue to hold the Instruments if the Applicable Rate thereon is determined
with respect to the LIBO Rate, then the Applicable Rate on such Instruments
shall be converted automatically to the Base Rate plus the Applicable Margin
(but in no event to exceed the Maximum Rate) on and after the last day of the
applicable Interest Period or on and after such earlier date as may be required
by such Law. As soon as practicable thereafter, the Company, the Agent and the
Purchasers shall negotiate a Substitute Rate.
(f) Upon the occurrence and during the continuance of an Event of
Default arising from the nonpayment of the Company's obligations hereunder, the
Applicable Rate on the Instruments shall automatically be converted to the Base
Rate.
SECTION 6.02. Assignments and Participations. (a) The Company may
not assign its rights or delegate its obligations under this Agreement without
the prior written consent of the Agent and all of the Purchasers. Upon an
assignment to and assumption by a Person of the rights and obligations of the
Company under and in compliance with this Agreement, the representations,
warranties and covenants of the Company and the conditions applicable to the
Company hereunder shall thereafter apply to such Person and not to the Company.
(b) In addition to the assignments permitted under Section 6.02(h),
each Note Purchaser and each Certificate Purchaser may assign to one or more
Eligible Assignees all or a portion of the Instruments then held by it and its
rights and obligations thereunder and under this Agreement (including, without
limitation, all or a portion of its Interim Note Commitment and Certificate
Commitment and/or the Advances under its Interim Notes and/or its Investment
under its Certificates) and the other Operative Documents; provided, however,
that (i) each assignment shall be of a constant, and not a varying, percentage
of all such rights and obligations; (ii) each such assignment of Notes shall be
of a pro rata share of each series of Notes then held by such Note Purchaser;
(iii) the aggregate principal amount of the Notes being assigned pursuant to
each such assignment (determined as of the date of the Assignment and Acceptance
with respect to such assignment) shall in no event be less than $5 million in
original principal amount and in integral multiples of $1 million in excess
thereof; (iv) no such assignment shall be made if as a result thereof any
Purchaser's aggregate Interim Note Commitment, after giving effect to such
assignment, are less than $5 million (determined as of the date of the
Assignment and Acceptance with respect to such assignment); provided, however,
that this Section 6.02(b)(iii)-(iv) shall not prohibit an assignment of the
entire outstanding principal amount of the Notes then held by a Purchaser; and
(v) the parties to each such assignment shall execute and deliver to each of the
Agent, with (if requested by the Agent) an administrative fee to be paid by the
Assignor (as defined
24
below) of $3,000, and the Trustee for its acceptance and recording in the Record
or the Register as the case may be, an Assignment and Acceptance; provided,
however, the requirements of Sections 6.02(b)(i)-(iv) shall not apply with
respect to assignments to such Purchaser's Affiliates or to any financial
institutions to which the Note Purchaser is assigning Notes as collateral
security pursuant to Regulation A of the Federal Reserve Board and any operating
circular issued by the Federal Reserve System and/or the Federal Reserve Bank or
otherwise. Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Assignment and Acceptance (which
effective date shall be at least five Business Days after the execution of such
Assignment and Acceptance, or with respect to an Assignment and Acceptance for
Certificates, such earlier date as the Assignor and Assignee shall agree), (x)
the assignee thereunder (the "Assignee") shall be a party hereto and to the
other Operative Documents to which the Purchasers are parties and, to the extent
that rights and obligations hereunder have been assigned to and assumed by it,
have the rights and obligations of a Purchaser hereunder and a Holder of
Instruments under the Operative Documents (including the obligation of
confidentiality set forth in Section 9.17) and (y) the assignor thereunder (the
"Assignor") shall, to the extent that rights and obligations hereunder have been
assigned by it, relinquish its rights (other than any rights to indemnification
it may have hereunder or under the Operative Documents) and be released from its
obligations under this Agreement (other than the confidentiality obligations set
forth in Section 9.17) and the other Operative Documents with respect to all or
such portion, as the case may be, of its Interim Note and/or Certificate
Commitments (and, in the case of an Assignment and Acceptance covering all or
the remaining portion of Assignor's rights and obligations under the Agreement
and the other Operative Documents, such Assignor shall, except as set forth
above, cease to be a party hereto). To the extent that the Certificate Purchaser
is an Assignor, the term "Certificate Purchaser," as used in the Operative
Documents, shall refer to each Holder of the Certificates and the obligations of
each Certificate Purchaser hereunder shall be several and not joint and several.
(c) By executing and delivering an Assignment and Acceptance, the
Assignor thereunder and the Assignee thereunder confirm to and agree with each
other and the other parties hereto as follows: (i) other than as provided in
such Assignment and Acceptance, such Assignor makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement and
the other Operative Documents or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement, the other
Operative Documents or any other instrument or document furnished pursuant
hereto; (ii) such Assignor makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Company or the
Construction Agent or the performance or observance by the Company or the
Construction Agent of any of their respective obligations under this Agreement
or any other Operative Document, or any other instrument or document furnished
pursuant hereto; (iii) such Assignee confirms that it has received a copy of
this Agreement, together with copies of the financial statements referred to in
Section 4.01(d) and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision with respect to
entering into such Assignment and Acceptance; (iv) such Assignee will,
independently and without reliance upon the Agent, the Company, the Trustee,
such Assignor or any other Note or Certificate Purchaser and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement; (v) such Assignee confirms that it is an Eligible Assignee; (vi) such
Assignee appoints and authorizes the Agent to take such action as agent on its
25
behalf and to exercise such powers under this Agreement and the other Operative
Documents as are delegated to the Agent by the terms hereof and thereof,
together with such powers as are reasonably incidental thereto; and (vii) such
Assignee agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed by
it as a Note and/or Certificate Purchaser.
(d) The Agent shall maintain at its address listed on Schedule I
hereto a copy of each Assignment and Acceptance delivered to and accepted by it
and a register for the recordation of the names and addresses of the Note and
Certificate Purchasers and the Commitment of, and principal amount of the
Advances and stated amount of the Investment owing to, each Note and Certificate
Purchaser from time to time (the "Record"). The entries in the Record shall be
conclusive and binding for all purposes, absent manifest error, and the Company,
the Agent, the Trustee and the Note and Certificate Purchasers may treat each
Person whose name is recorded in the Record as a Note and/or Certificate
Purchaser hereunder for all purposes of this Agreement. The Record shall be
available for inspection by the Company or any Note or Certificate Purchaser at
any reasonable time and from time to time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
Assignor and an Assignee representing that it is an Eligible Assignee, the Agent
shall, if such Assignment and Acceptance has been completed give prompt oral or
written notice to the Company and the Trustee and (i) accept such Assignment and
Acceptance, and (ii) record the information contained therein in the Record. The
Agent shall provide the Company with a current list of all Purchasers no less
frequently than quarterly.
(f) Each Note and Certificate Purchaser may sell participations to
one or more banks or other entities in or to all or a portion of the Instruments
then held by it and its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Commitment and the Instrument or
Instruments held by it) and the other Operative Documents; provided, however,
that (i) such Purchaser's obligations under this Agreement and the other
Operative Documents (including without limitation all or a portion of its
Interim Note Commitment to make Advances) shall remain unchanged; (ii) such Note
or Certificate Purchaser shall remain the Holder of any such Instrument for all
purposes under this Agreement and the other Operative Documents and the Company,
the Agent, the Trustee, and the other Note and Certificate Purchasers shall
continue to deal solely and directly with such Purchaser in connection with such
Purchaser's rights and obligations under this Agreement; (iii) no such
participant shall be entitled to receive any greater payment than such Purchaser
would have been entitled to receive with respect to the rights participated
(including, without limitation, payments for Taxes, Other Charges or Increased
Costs) except as a result of circumstances arising after the date of such
participation to the extent that such circumstances affect other Note or
Certificate Purchasers and participants generally; and (iv) no Note or
Certificate Purchaser shall assign or grant a participation that conveys to the
participant the right to vote or consent under this Agreement, other than the
right to vote upon or consent to any reduction of the principal or stated amount
of or the interest or Distributions to be paid on such Purchaser's Instrument(s)
or any postponement of any date for the payment of any amount payable in respect
of such Purchaser's Instruments.
(g) Any Note or Certificate Purchaser may, in connection with any assignment
or participation or proposed assignment or participation pursuant to this
Section 6.02, disclose to the assignee or
26
participant or proposed assignee or participant, any information relating
to the Company furnished to such Note or Certificate Purchaser by or on
behalf of the Company; provided, that prior to any such disclosure, the
assignee or participant or proposed assignee or participant shall agree in
writing with the Company and the Agent to preserve the confidentiality of
any confidential information relating to the Company or the transactions
contemplated by this Agreement (including, without limitation, the general
structure of this transaction) received by it from such Note or
Certificate Purchaser in a manner consistent with that set forth in
Section 9.17 hereof
(h) Anything in this Section 6.02 to the contrary notwithstanding
(except that at all times the requirements of Section 6.02(g) shall be
satisfied), any Note Purchaser may assign and pledge, as collateral or
otherwise, and without notice to or consent of the Company, all or any of the
Notes held by it and any of its rights (including, without limitation, rights to
payment of the principal of and interest on the Notes) under this Agreement to
(i) any of its Affiliates and (ii) any Federal Reserve Bank, the United States
Treasury or to any other financial institution as collateral security pursuant
to Regulation A of the Federal Reserve Board and any operating circular issued
by the Federal Reserve System and/or the Federal Reserve Bank or otherwise;
provided, that any payment made by the Company to the Trustee for the benefit of
such assigning and/or pledging Purchaser in accordance with the terms of the
Operative Documents shall satisfy the Company's obligations under the Operative
Documents in respect thereof to the extent of such payment. No such assignment
and/or pledge set forth in (ii) above shall release the assigning and/or
pledging Note Purchaser from its obligations hereunder.
SECTION 6.03. Taxes. (a) Any and all payments by the Company, the
Trustee or the Agent hereunder or under any of the other Operative Documents
(including, without limitation, payments of Fixed Rent, Additional Rent,
interest, Distributions, fees and principal and stated amounts of the
Instruments) shall be made free and clear of and without deduction for any and
all present or future Impositions and all liabilities with respect thereto,
excluding, in the case of payments made to each Purchaser, the Agent or the
Trustee, as the case may be, Excluded Charges. Deduction may be made, if
required to be made by Law, in the case of payments made to each Purchaser, the
Agent or the Trustee, as the case may be, for each of the Excluded Charges.
If the Company, the Agent or the Trustee shall be required by Law to
deduct any Charges from or in respect of any sum payable hereunder or under any
of the Operative Documents to the Trustee, the Agent or any Purchaser, (i) the
sum payable by such deducting party shall be increased as may be necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 6.03) the Trustee, the Agent or such
Purchaser, as the case may be, receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Company, the Agent or the
Trustee, as the case may be, shall make such deductions, and (iii) the Company,
the Agent or the Trustee as the case may be, shall pay the full amount deducted
to the relevant taxation authority or other authority in accordance with
applicable Law. The Company will indemnify the Agent and the Trustee for the
full amount of any sums paid by the Agent and the Trustee pursuant to the
preceding sentence.
(b) Notwithstanding anything to the contrary contained in this
Agreement, each of the Company, the Agent and the Trustee shall be entitled, to
the extent it is required to do so by Law, to deduct or withhold income or other
similar Taxes imposed by the United States of America or any other jurisdiction
on Fixed Rent, Additional Rent, interest, Distributions, fees,
27
principal and stated amounts of the Instruments or other amounts payable
hereunder or under the other Operative Documents for the account of the Trustee,
the Agent or any Purchaser (without the payment of increased amounts to such
Purchaser, the Agent or the Trustee pursuant to clause (a) of this Section 6.03
in the case of Excluded Charges) unless the Trustee (or any successor thereto)
or a Purchaser, as the case may be, has timely filed with the Agent (who shall
then promptly forward the same to the Company and the Trustee) the Prescribed
Forms for the applicable year to the extent deduction or withholding of such
Taxes is not required or reduced as a result of the filing of such Prescribed
Forms. If the Agent or the Trustee shall so deduct or withhold any such Taxes,
it shall provide a statement to such Purchaser, and if the Company shall so
deduct or withhold any such Taxes, it shall provide a statement to the Trustee,
in each case setting forth the amount of such Taxes so deducted or withheld, the
applicable rate and any other information or documentation which such Purchaser
or the Trustee may reasonably request for assisting such Purchaser or the
Trustee to obtain any allowable credits or deductions for the Taxes so deducted
or withheld in the jurisdiction or jurisdictions in which such Purchaser is
subject to Taxes.
(c) In addition, the Company agrees to pay and/or reimburse any
present or future stamp or documentary Taxes or any other excise or property
Taxes payable by or on behalf of the Agent, the Trustee or any Purchaser,
including any transfer Taxes with respect to the Trustee's acquisition of the
Property or other property transfer, transfer gains or mortgage recording Taxes,
charges or similar levies which arise from the acquisition, ownership,
operation, occupancy, possession, use, non-use, financing, leasing or
disposition or condition of the Property or any part thereof by the Trustee or
from any payment made to the Agent, the Trustee or any Purchaser hereunder or
under the other Operative Documents or from the execution, delivery or
registration of, or otherwise with respect to, this Agreement or any of the
other Operative Documents and arising directly or indirectly out of the
transactions contemplated by this Agreement or any of the Operative Documents
(hereinafter referred to as "Other Taxes").
(d) The Company will indemnify the Trustee, the Agent and each Note
and Certificate Purchaser for the full amount of any Charges (including, without
limitation, any Other Taxes imposed by any jurisdiction on amounts payable under
this Section 6.03) paid by the Trustee, the Agent or such Purchaser as the case
may be, and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto, whether or not such Charges were correctly or
legally asserted (it being the intent to indemnify the Trustee, the Agent and
the Purchasers with respect to Charges resulting from such Person's own
negligence). Payments under this indemnification shall be made within 30 days
from the date such Purchaser, the Agent or the Trustee, as the case may be,
makes written demand therefor, which demand shall include a receipt or a
reasonably detailed statement of such Charges. In no event shall the Company, in
connection with this indemnity or for any other purpose whatsoever under any
Operative Document, have any right to examine any tax return or related books
and records of the Trustee, the Agent or of any Note or Certificate Purchaser.
(e) As soon as practicable but in any event within 15 days after the
date of the payment of Charges by the Company, the Company will furnish to the
Trustee the original or a certified copy of a receipt or other similar
instrument (if available) evidencing payment thereof Should any Purchaser, the
Agent or the Trustee receive any refund, credit or deduction from any taxing
authority (whether before or after payment in full of the principal and stated
amount of, and interest on and Distributions with respect to, the Instruments)
to which such Purchaser, the Agent
28
or the Trustee, as the case may be, would not be entitled but for the payment by
the Company of Charges as required by this Section 6.03 (it being understood
that the decision whether to make a claim, and if claimed, as to the amount of
any such refund, credit or deduction shall be made by such Purchaser, the Agent
or the Trustee in its sole discretion; such Purchaser, the Agent or the Trustee,
as the case may be, thereupon shall repay, together with any interest paid or
allowed by the refunding, crediting or deducting taxing authority in connection
with such refund, credit or deduction, to the Company an amount with respect to
such refund, credit or reduction equal to any net reduction in Taxes actually
obtained by such Purchaser, the Agent or the Trustee, as the case may be, and
determined by such Purchaser, the Agent or the Trustee, as the case may be, in
its sole discretion to be attributable to such refund, credit or deduction.
(f) Each Note Purchaser organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and delivery
of this Agreement in the case of each initial Note Purchaser and on the date of
the Assignment and Acceptance pursuant to which it becomes a Note Purchaser in
the case of each other Note Purchaser, and from time to time thereafter if
requested in writing by the Company (but only so long as such Note Purchaser
remains lawfully able to do so), shall provide the Company with Internal Revenue
Service form 1001 or 4224, as appropriate, or any successor or other form
prescribed by the Internal Revenue Service, certifying that such Note Purchaser
is exempt from or entitled to a reduced rate of United States withholding tax on
payments of interest pursuant to this Agreement or the Notes. If any form
provided by a Note Purchaser at the time such Note Purchaser first becomes a
party to this Agreement indicates a United States interest withholding tax rate
in excess of zero, withholding tax at such rate shall be considered excluded
from Taxes. If any form or document referred to in this subsection (e) requires
the disclosure of information, other than information necessary to compute the
tax payable and information required on the date hereof by Internal Revenue
Service form 1001 or 4224, that the Note Purchaser reasonably considers to be
confidential, the Note Purchaser shall give notice thereof to the Company and
shall not be obligated to include in such form or document such confidential
information to the extent permitted by law.
(g) Without prejudice to the survival of any other agreement of the
Company, the Trustee, the Agent or the Purchasers hereunder, the agreements and
obligations of the Company, the Trustee, the Agent and the Purchasers contained
in this Section 6.03 shall survive the payment in full of both the principal of
and interest on the Notes and the Certificate Liquidation Amount of the
Certificates.
SECTION 6.04. Substitution of Purchaser. If (i) any Note Purchaser
shall have converted the basis for determining the Applicable Rate on its
Instruments from the LIBO Rate to Base Rate pursuant to Section 6.0 1(c) or (e)
or shall have required the payment of Reserve Costs or Increased Costs, or (ii)
any Note or Certificate Purchaser shall have required the payment of Charges or
Other Taxes, the Company shall have the right, after consultation and discussion
with the Agent, to seek a substitute purchaser or purchasers satisfactory to the
Company (which may be one or more of the Note or Certificate Purchasers) to
assume the Note and/or Certificate Commitments of such Purchaser and to purchase
the Instruments held by such Purchaser (without recourse to or warranty by such
Purchaser and subject to all amounts owing to such Purchaser under this
Agreement having been paid in full).
29
SECTION 6.05. Sharing of Payments, Etc. If any Note or Certificate
Purchaser shall obtain any payment (whether voluntary or involuntary), on
account of the Instruments held by it (other than on account of Reserve Costs,
Funding Costs, Break Costs, Illegality Costs or Increased Costs and other than
pursuant to Section 6.03 or any indemnification provision of the Operative
Documents) in excess of its ratable share of payments on account of the
Instruments obtained by all the Note and Certificate Purchasers, such Purchaser
shall forthwith purchase from the other Note and Certificate Purchasers such
participations in the Instruments held by them as shall be necessary to cause
such purchasing Purchaser to share the excess payment ratably with each of them;
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Purchaser, such purchase from each
Note and Certificate Purchaser shall be rescinded and each Note and Certificate
Purchaser shall repay to the purchasing Purchaser the purchase price to the
extent of such Purchaser's ratable share (according to the proportion of (i) the
amount of the participation purchased from such Purchaser as a result of such
excess payment to (ii) the total amount of the participations purchased in
respect of such excess payment) of such recovery together with an amount equal
to such Purchaser's ratable share (according to the proportion of (i) the amount
of such Purchaser's required repayment to (ii) the total amount so recovered
from the purchasing Purchaser) of any interest or other amounts paid or payable
by the purchasing Purchaser in respect of the total amount so recovered.
Notwithstanding that the Purchaser shall have purchased a participation in such
Instruments, the purchasing Purchaser shall be deemed to have acquired the
voting rights under such Instruments to the extent of, and for the duration of,
such participation, as if such Purchaser shall have been an Assignee thereof.
SECTION 6.06. Tax Treatment, Etc.. (a) The parties hereto agree that
it is the Company's intention that for Federal, state and local income Tax
purposes and for bankruptcy purposes (i) the Lease be treated as the repayment
and security provisions of a loan by the Trustee to the Company, (ii) the Lessee
be treated as the legal and beneficial owner entitled to any and all benefits of
ownership of the Property or any part thereof and (iii) all payments of Fixed
Rent during the Term be treated as payments of interest and principal, as the
case may be.
(b) The Company agrees that neither it nor any member of any
affiliated group of which it is or may become a member (whether or not
consolidated or combined returns are filed for such affiliated group for
Federal, state or local income Tax purposes) will at any time take any action,
directly or indirectly, or file any return or other document inconsistent with
the intended income Tax treatment set forth in Section 6.06(a) hereof, and the
Company agrees that the Company and any such Affiliates will file such returns,
maintain such records, take such actions and execute such documents as may be
appropriate to facilitate the realization of such intended income Tax treatment.
(c) Each of the Trustee, the Agent and the Note and Certificate
Purchasers agrees that neither it nor any member of any affiliated group of
which it is or may become a member (whether or not consolidated or combined
returns are filed for such affiliated group for Federal, state or local income
Tax purposes) will at any time take any action, directly or indirectly, or file
any return or other document claiming, or asserting that it is entitled to the
income Tax benefits, deductions and/or credits which, pursuant to the intended
income Tax treatment set forth in Section 6.06(a) hereof, would otherwise be
claimed or claimable by the Company, and that it and any such Affiliates will
file such returns, maintain such records, take such actions, and execute such
documents (as reasonably requested by the Company from time to time) as may be
30
appropriate to facilitate the realization of, and as shall be consistent with,
such intended income Tax treatment, other than engaging in any contest of such
treatment with any taxing authority, ..ad if any such filing, maintenance,
action or execution requested by the Company would result in any additional
income Tax liability payable by it or any Affiliate, or could reasonably be
expected to result in liability payable by it or any Affiliate, other than any
liability related to or arising as a result of the intended income Tax treatment
set forth in Section 6.06(a) hereof, then the Company will provide an indemnity
against such unrelated income Tax liability or other liability satisfactory to
the Trustee, the Agent or the Note and Certificate Purchaser, as the case may
be, in its sole opinion.
ARTICLE VII.
EVENTS OF DEFAULT AND UNWIND EVENTS
SECTION 7.01. Events of Default. If any of the following events
shall occur and be continuing, it shall constitute an "Event of Default"
hereunder:
(a) The Company shall (i) fail to observe or perform any covenant
contained in Sections 5.01(a)(iii), 5.01(d)(ii), 5.01(i), 5.01(j), 5.01(p) or
5.01(q) hereof, (ii) not comply with any of its payment obligations under
Section 9.15(c) hereof within five Business Days after its receipt of a written
demand by an Indemnified Party, (iii) not comply with any of its other
obligations under Section 9.15 hereof in a timely manner or (iv) shall fail to
satisfy any obligation subsequent contained in Section 2.03 within the time
periods therein provided.
(b) Other than as is set forth in Section 7.01(a) hereof, the
Company shall fail to observe or perform any covenant or agreement contained in
this Agreement and such failure shall continue unremedied for 10 days after
written notice thereof has been given to the Company by the Trustee or the Agent
of such failure.
(c) The Company or any of its Subsidiaries shall fail T~ pay any
principal of or premium or interest on any Indebtedness that is outstanding in a
principal or notional amount of at least $25,000,000 in the aggregate (but
excluding Indebtedness outstanding hereunder) of the Company or such Subsidiary
(as the case may be), when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or otherwise), and
such failure shall continue after the applicable grace period, if any, specified
in the agreement or instrument relating to such Indebtedness; or any other event
shall occur or condition shall exist under any agreement or instrument relating
to any such Indebtedness and shall continue after the applicable grace period,
if any, specified in such agreement or instrument, if the effect of such event
or condition is to accelerate, or to permit the acceleration of, the maturity of
such Indebtedness; or any such Indebtedness shall be declared to be due and
payable, or required to be prepaid or redeemed (other than by a regularly
scheduled required prepayment or redemption), purchased or defeased, or an offer
to prepay, redeem, purchase or defease such Indebtedness shall be required to be
made, in each case prior to the stated maturity thereof; or
(d) The Company or any of its Subsidiaries shall generally not pay
its debts as such debts become due, or shall admit in writing its inability to
pay its debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against the Company or
any of its Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or
31
seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for it or for any substantial part of its
property and, in the case of any such proceeding instituted against it (but not
instituted by it), either such proceeding shall remain undismissed or unstayed
for a period of 60 days, or any of the actions sought in such proceeding
(including, without limitation, the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official for, it
or for any substantial part of its property) shall occur; or the Company or any
of its Subsidiaries shall take any corporate action to authorize any of the
actions set forth above in this subsection (d); provided, however, that none of
the foregoing acts or occurrences in this subsection (d) with respect to a
subsidiary of the Company shall constitute an Event of Default unless the effect
thereof shall be significant in relation to the Company and its subsidiaries,
taken as a whole; or
(e) Any unsatisfied judgment or order for the payment of money in
excess of $5,000,000 shall be rendered against the Company or any of its
Subsidiaries and there shall be any period of 10 consecutive days during which a
stay of enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
(f) Any non-monetary judgment or order shall be rendered against the
Company or any of its Subsidiaries that could be reasonably expected to have a
Material Adverse Effect, and there shall be any period of 30 consecutive days
during which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect; or
(g) Any ERISA Event shall have occurred and the sum (determined as
of the date of occurrence of such ERISA Event) of the liability arising from
such ERISA Event, together with the sum of the liabilities under or attributable
to any Employee Benefit Plans has, or is reasonably likely to have, individually
or in the aggregate, a Material Adverse Effect; or (2) the Company or any ERISA
Affiliate fails to make full payment when due of all amounts which, under the
provisions of any Pension Plan or Section 412 of the Code, the Company or any
ERISA Affiliate is required to pay as contributions thereto and such failure
results or is likely to result in a Material Adverse Effect; (3) an accumulated
funding deficiency occurs or exists, whether or not waived, with respect to any
Pension Plan; (4) with respect to any Pension Plan covered by Title IV of ERISA,
the filing of a notice to voluntarily terminate any such plan in a distress
termination; (5) the Company or any ERISA Affiliate withdraws from any
Multiemployer Plan and receives a notice of liability in such amount as would
have a Material Adverse Effect; or (6) the Company or any ERISA Affiliate
terminates a Pension Plan which results in liability that would have a Material
Adverse Effect.
(h) Any certification or any representation or warranty of the
Company set forth herein or in any Operative Document or certificate, notice,
demand, request or other document delivered by or on behalf of the Company to
the Trustee, the Note and/or Certificate Purchasers or the Agent hereunder or
under any Operative Document shall prove to be inaccurate in any material
respect when the same shall have been made.
(i) An "Event of Default" (as defined in any such other Operative
Document but excluding an Unwind Event) under any such other Operative Document
shall have occurred.
32
(j) (i) Any Operative Document or any obligation of the Company
thereunder shall be revoked or repudiated or attempted to be revoked or
repudiated by the Company, or (ii) any Operative Document or any material
obligation of the Company thereunder shall cease to be in full force and effect,
by operation of law or by any other means.
SECTION 7.02. Remedies upon an Event of Default. (a) If an Event of
Default has occurred and is continuing, the Trustee may exercise any of the
rights or remedies granted to the Trustee under the Lease or any of the other
Operative Documents, in addition to any rights or remedies of such parties set
forth in this Participation Agreement.
(b) If an Event of Default has occurred and is continuing, then each
of the Trustee, the Agent and the Purchasers may take all steps necessary or
advisable to protect and enforce its rights hereunder, whether by action, suit
or proceeding at law or in equity, for the specific performance of any covenant,
condition or agreement contained herein, or in aid of the execution of any power
herein granted, or for the enforcement of any other appropriate legal or
equitable remedy or otherwise as such party shall deem necessary or advisable.
(c) No right or remedy hereunder shall be exclusive of any other
right, power or remedy, but shall be cumulative and in addition to any other
right or remedy hereunder or now or hereafter existing by law or in equity, and
the exercise by a party hereto of any one or more of such rights, power or
remedies shall not preclude the simultaneous exercise of any or all of such
other rights, powers or remedies. Any failure to insist upon the strict
performance of any provision hereof or to exercise any option, right, power or
remedy contained herein shall not constitute a waiver or relinquishment thereof
for the future. The Trustee and the Holders from time to time of the Instruments
shall be entitled to injunctive relief in case of the violation or attempted or
threatened violation of any of the provisions hereof by any other party hereto,
a decree compelling performance of any of the provisions hereof or any other
remedy allowed by Law or in equity.
SECTION 7.03. [Intentionally Omitted]
SECTION 7.04. [Intentionally Omitted]
SECTION 7.05. Residual Guaranty and Return Conditions. (a) Upon the
expiration of the Lease, if the Company does not purchase the Property pursuant
to the Lease, the Company shall pay to the Trustee on the Expiration Date an
advance residual guaranty payment equal to the Series A Portion of the Original
Capitalized Cost of the Property (the "Residual Guaranty").
(b) Upon the election of the Company to surrender the Property to
the Trustee pursuant to paragraph 27(a)(ii) of the Lease or Section 7.04(i)
hereof, the Company shall provide, or cause to be provided or accomplished, at
the sole cost and expense of the Company, to or for the benefit of the Trustee
and the holders of the Instruments, at least thirty (30) days but not more than
sixty (60) days prior to the Expiration Date or date of such other termination
of the Lease each of the following (collectively, the "Return Conditions"):
33
(i) an environmental audit of the Property, together with a copy of the
Environmental Consultant's report on its audit, satisfactory, in form and
substance, to the Agent, the Trustee and the B-Note and Certificate Purchasers,
each in their sole discretion to the effect that (A) the Property is in
compliance with all Environmental Laws then enacted or then proposed, as
determined by the Environmental Consultant and special counsel selected by the
Agent; (B) no environmental condition exists on the Property on the date the
Property is surrendered that could pose any significant risk to human health or
the environment and (C) there is no pending or overtly threatened litigation,
investigation or other legal proceeding of any kind that could result in any
liability to any Purchaser, the Agent or the trustee or in the imposition of any
Lien on the Property;
(ii) a report of the Appraiser and/or the Independent
Engineer, satisfactory in form and substance to the Trustee, the Agent and
the B-Note and Certificate Purchasers, to the effect that (A) the Property
has been maintained in accordance with the terms and conditions of the
Lease and that (based on inspection) the Property (x) meets or exceeds the
design specifications as of the Final Completion Date (taking into account
normal wear and tear) and (y) is capable of operating as lubricant,
stearate and stabilizer manufacturing facilities at design capacity, and
at an efficiency and reliability typical of then-current market standards
for similar plants located in the United States and with the useful life
contemplated by and in accordance with the Construction Plans and
applicable Laws, and (z) is capable of meeting the terms of any material
existing contracts involving the Property; and (B) all Assets and
Improvements that have been stored in inventory have been maintained at,
or restored to, operating specifications;
(iii) evidence satisfactory to the Agent, the Trustee and the
Purchasers of the B-Notes and Certificates that the Company is, and (as of
the Expiration Date or date of such other termination of the Lease) will
be, in full compliance with the Services Agreement and has made
arrangements satisfactory to the Agent for the provision of services
required thereunder for the term thereof;
(iv) the Company shall have arranged for (A) a Texas Standard
Form T-1 form of extended coverage owner's title insurance policy, or a
commitment therefor, issued by the Title Company, marked "premium paid" in
an aggregate amount equal to the lesser of (i) the maximum insurable
amount or (ii) the Original Capitalized Cost of the Property and in form
and substance satisfactory to the Purchasers and Special Counsel, to be
delivered to the Purchasers and Special Counsel, together with copies of
all documents relating to title exceptions referred to therein, showing
record title of the Trustee in the Texas Fee Parcels and the Texas Fee
Improvements located thereon and (B) an ALTA 1970 (amended 10-17-70 and
10-17-84) form of extended coverage owner's title insurance policy, or a
commitment therefor, issued by the Title Company, marked "premium paid" in
an aggregate amount equal to the lesser of (i) the maximum insurable
amount or (ii) the Original Capitalized Cost of the Property and in form
and substance satisfactory to the Purchasers and Special Counsel, to be
delivered to the Purchasers and Special Counsel, together with copies of
all documents relating to title exceptions referred to therein, showing
record title of the Trustee in the Ohio Fee Parcels and the Ohio Fee
Improvements located thereon;
34
(v) the Company may and, if directed to do so by the Trustee,
the Company shall remove, or cause the removal of, at the Company's sole
expense, any inventory, fixtures, machinery, equipment or other property
belonging to the Company or third parties in compliance with paragraph
10(b) of the Lease; and
(vi) if directed to do so by the Trustee, the Company shall
cause all, or any portion of the Improvements not located on one of the
Fee Parcels or one of the Easement Parcels, to be installed in operating
order on such of the Fee Parcels or on such of the Easement Parcels as the
Trustee shall direct; and
(vii) if directed to do so by the Trustee, the Company shall
execute and deliver any and all further instruments, agreements and
documents as may, in the reasonable opinion of the Trustee, be necessary
to confirm the termination and expiration of the Lease and to acknowledge
that the Company, from the date of termination and expiration, ceases to
have any interest in the Property under the Lease.
ARTICLE VIII.
THE AGENT
SECTION 8.01. Authorization and Action. Each Purchaser hereby
appoints and authorizes the Agent to take such action as the Agent on such
Purchaser's behalf and to exercise such powers under this Agreement and the
other Operative Documents as are delegated to the Agent by the terms hereof and
thereof, together with such powers as are reasonably incidental thereto. The
Trustee hereby appoints and authorizes the Agent to collect, disburse, invest
and otherwise administer on the Trustee's behalf all funds paid or payable to
the Trustee hereunder or under any of the Operative Documents, in each case in
accordance with the terms thereof and the Trustee, in its individual capacity,
shall not be liable for the actions or inactions of the Agent in connection with
the Agent's collection, disbursement, investment and administration of such
funds. As to any matters not expressly provided for by this Agreement or the
other Operative Documents, the Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Majority Purchasers, and such instructions shall be
binding upon all Purchasers; provided, however, that the Agent shall not be
required to take any action which exposes the Agent to personal liability or
which is contrary to this Agreement or applicable Law. The Agent agrees to give
to each Note and Certificate Purchaser prompt notice of each notice given to it
by the Company; and the Trustee pursuant to the terms of the Operative
Documents.
SECTION 8.02. Agent's Reliance, Etc. Neither the Agent nor any of
its directors, officers, agents or employees shall be liable for any action
taken or omitted to be taken by it or them under or in connection with this
Agreement or the other Operative Documents, except for its or their own gross
negligence or willful misconduct, it being the intent that such Persons shall
not be liable for any such action or inaction that constitutes ordinary
negligence. Without limiting the generality of the foregoing, the Agent: (i) may
consult with legal counsel, independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or
35
experts; (ii) makes no warranty or representation to any Note or Certificate
Purchaser and shall not be responsible to any Note or Certificate Purchaser for
any statements, warranties or representations made in or in connection with this
Agreement or the other Operative Documents; (iii) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the terms,
covenants or conditions of this Agreement or the other Operative Documents on
the part of the Company or to inspect the property (including the books and
records) of the Company; (iv) shall not be responsible to any Note or
Certificate Purchaser for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement or the other Operative
Documents or any other instrument or document furnished pursuant hereto; and (v)
shall incur no liability under or in respect of this Agreement or the other
Operative Documents by acting upon any notice, consent, certificate or other
instrument or writing in accordance with the terms hereof believed by it to be
genuine and signed or sent by the proper party or parties.
SECTION 8.03. Citicorp and Affiliates. With respect to the Fundings
made by it and the Instruments issued to it, Citicorp, USA, Inc. shall have the
same rights and powers under any Instrument and this Agreement as any other
Purchaser and may exercise the same as though Citibank were not the Agent; and
the terms (x) "Purchaser" or "Purchasers" and (y) "Note Purchaser" or "Note
Purchasers" shall, unless otherwise expressly indicated, include Citicorp, USA,
Inc. in its individual capacity, and Citicorp and its Affiliates may accept
deposits from, lend money to, act as trustee under indentures of, and generally
engage in any kind of business with, the Company and any Subsidiary and any
Person who may do business with or own securities of the Company, or any
Subsidiary, all as if Citibank were not the Agent and without any duty to
account therefor to the Purchasers.
SECTION 8.04. Purchaser Credit Decision. Each Purchaser acknowledges
that it has, independently and without reliance upon the Agent, the Trustee or
any other Purchaser and based on the financial statements referred to in Section
4.01(d) and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Purchaser also acknowledges that it will, independently and without reliance
upon the Agent, the Trustee or any other Note or Certificate Purchaser or Holder
from time to time of the Instruments and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions with respect to this Agreement or any of the other Operative
Documents.
SECTION 8.05. Indemnification. The Note and Certificate Purchasers
agree to indemnify the Agent, ratably according to the respective aggregate
principal and stated amounts of the Instruments then held by each of them (or if
the Instruments have been fully repaid and retired or if any Instruments are
held by Persons which are not Note or Certificate Purchasers, ratably according
to either (i) the respective aggregate amounts of their Note and Certificate
Commitments, or (ii) if all such Commitments have terminated, the respective
amounts of the Note and Certificate Commitments immediately prior to the time
the Note and Certificate Commitments were terminated), from and against any and
all Losses which may be imposed on, incurred by, or asserted against the Agent
in any way relating to or arising out of this Agreement or any other Operative
Document or any action taken or omitted by the Agent under this Agreement or any
other Operative Document; provided, that no Note or Certificate Purchaser shall
be liable to the Agent for any portion of such Losses resulting from the Agent's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Note or Certificate Purchaser agrees to
36
reimburse the Agent promptly upon demand for its ratable share of any
out-of-pocket expenses (including reasonable counsel fees) incurred by the Agent
in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement or any other Operative Document to the
extent that the Agent is not reimbursed for such expenses by the Company.
SECTION 8.06. Successor Agent. The Agent may resign at any time as
Agent under this Agreement by giving written notice thereof to the Note and
Certificate Purchasers, the Trustee and the Company and may be removed at any
time with or without cause by the Majority Purchasers. Upon any such resignation
or removal, the Majority Purchasers, subject to the consent of the Company
(which consent shall not be unreasonably withheld), shall have the right to
appoint a successor Agent which shall be a commercial bank or trust company
organized or licensed to conduct banking business under the Laws of the United
States or any state thereof. If no successor Agent shall have been so appointed
by the Majority Purchasers, and shall have accepted such appointment, within 30
days after the retiring Agent's giving of notice of resignation or the Majority
Purchasers' removal of the retiring Agent, then the retiring Agent may, on
behalf of the Note and Certificate Purchasers, appoint a successor Agent, which
shall be a Note or Certificate Purchaser which is a commercial bank organized
under the laws of the United States of America or of any state thereof and
having a combined capital and surplus of at least $500 million. Upon the
acceptance of any appointment as Agent under this Agreement by a successor
Agent, such successor Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Agent and shall
function as the Agent under this Agreement, and the retiring Agent shall be
discharged from its duties and obligations as Agent under this Agreement. After
any retiring Agent's resignation or removal hereunder as Agent, the provisions
of this Article VIII shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent under this Agreement, irrespective
of any amendments hereto subsequent to such resignation or removal.
ARTICLE IX.
MISCELLANEOUS
SECTION 9.01. Survival. Except as otherwise expressly provided, the
parties' obligations under this Agreement and in any certificate or other
instrument delivered by any party or on such party's behalf pursuant to this
Agreement shall terminate upon the payment in full of all amounts then and
thereafter due on the Notes and the Certificates and under any of the Operative
Documents. The confidentiality provisions contained in this Agreement and the
provisions of Sections 6.03, 6.06, 9.14, 9.15, 9.17 and 9.20 hereof shall each
survive the payment in full of all amounts then and thereafter due on the
Instruments and due under any of the Operative Documents. Such rights and
obligations shall survive the execution and delivery of any Operative Document,
any issuance or disposition of any of the Instruments, any disposition of any
interest in the Property or the termination of any Operative Document and shall
continue in effect regardless of any investigation made by or on behalf of any
party hereto and notwithstanding that any party may waive compliance with any
other provision of any Operative Document.
SECTION 9.02. Notices. Unless otherwise specifically provided in any
Operative Document, all notices, consents, directions, approvals, instructions,
requests and other
37
communications given to any party hereto under any Operative Document shall be
in writing to such party at the address set forth in Schedule I hereto or at
such other address as such party shall designate by notice to each of the other
parties hereto and may be personally delivered (including delivery by private
courier services) or by telecopy (with a copy of such notice sent by private
courier service for overnight delivery or by registered or certified mail), to
the party entitled thereto, and shall be deemed to be duly given or made when
delivered by hand unless such day is not a Business Day, in which case such
delivery shall be deemed to be made as of the next succeeding Business Day or in
the case of telecopy (with a copy of such notice sent by private courier service
for overnight delivery or by registered or certified mail), when sent, so long
as it was received during normal business hours of the receiving party on a
Business Day and otherwise such delivery shall be deemed to be made as of the
next succeeding Business Day.
SECTION 9.03. Severability. If any provision hereof or the
application thereof to any Person or circumstance shall be invalid, illegal or
unenforceable, the remaining provisions or the application of such provision to
Persons or circumstances other than those as to which it is invalid or
enforceable, shall continue to be valid and enforceable.
SECTION 9.04. Amendments, Etc. No amendment or waiver of any
provision of this Agreement, nor consent to any departure by the Company
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Majority Purchasers (unless the Agent is authorized hereunder
or under any Operative Document to act without joinder of the Majority
Purchasers, in which case the Agent may take such action), the Company and the
Trustee, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided, however, that,
in addition to the requirements above, no amendment, waiver or consent shall,
unless in writing and signed by all of the Note and Certificate Purchasers, do
any of the following: (a) increase the Commitments of the Purchasers or subject
the Note or Certificate Purchasers to any additional obligations, (b) reduce the
Applicable Rate or any fees or other amounts payable hereunder or under any
other Operative Document, (c) take action which requires the signing of all the
Note and Certificate Purchasers pursuant to the terms of this Agreement, (d)
postpone any date fixed for any payment of principal or stated amount of, or
interest or Distributions on the Instruments or any fees or other amounts
payable under the Declaration or (e) amend this Section 9.04; provided, further,
that, in addition to the requirements above, no amendment, waiver or consent
shall, unless in writing and signed by the Agent in addition to the Purchasers
required above to take such action, affect the rights or duties of the Agent
under this Agreement or any of the Operative Documents. Notwithstanding the
foregoing, a waiver of any or all of the conditions set forth in Section 3.02
hereof shall be effective if in writing and signed by the Agent, the Majority
Purchasers and the Trustee.
SECTION 9.05. Headings. The table of contents and headings of the
Articles, Sections and subsections of this Agreement are for convenience only
and shall not affect the meaning of this Agreement.
SECTION 9.06. Compliance Responsibility. None of the Trustee
(notwithstanding the representations and warranties of SSBTC in Section 4.02
hereof), the Agent or any Purchaser shall have any responsibility for compliance
by the Property or by the Company with any Law, architectural or engineering
standards or practices or other matters. The Company expressly assumes such
responsibilities and shall indemnify and hold harmless the Trustee, the
38
Agent and the Note and Certificate Purchasers with respect thereto in the manner
provided in the Lease.
SECTION 9.07. Definitions. Except as otherwise expressly provided
herein, capitalized terms used in this Agreement and all schedules and exhibits
hereto shall have the respective meanings given in Appendix A hereto.
SECTION 9.08. Benefit. The parties hereto and their permitted
successors and assigns, but no others, shall be bound hereby and entitled to the
benefit hereof.
SECTION 9.09. Place of Payment. So long as a Purchaser or an
Affiliate of a Purchaser or a bank or institutional investor is the owner of any
beneficial interest in the Instruments, the Trustee will cause all amounts to be
paid by the Trustee which become due and payable or owing on such beneficial
interest in the Instruments to be paid by bank wire transfer of immediately
available funds or, at the option of such Purchaser, such Affiliate, bank or
institutional investor, by check of the Trustee, duly mailed, delivered or made
at the address or account referenced in Schedule I hereto or provided in writing
by such Person to the Trustee, in all cases without presentation of the
underlying Instrument, provided, that upon receipt of payment in full the
underlying Instruments shall be returned by the respective Holders thereof to
the Trustee marked "cancelled."
SECTION 9.10. Counterparts. The parties may sign this Agreement in
any number of counterparts and on separate counterparts, each of which shall be
an original but all of which together shall constitute one and the same
instrument.
SECTION 9.11. Governing Law and Jurisdiction. (a) THIS AGREEMENT
SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, INCLUDING SECTION 5-1 401 OF THE NEW YORK GENERAL OBLIGATIONS LAW (OR
ANY SIMILAR SUCCESSOR PROVISION THERETO) BUT EXCLUDING ALL OTHER
CONFLICT-OF-LAWS RULES.
(b) Each of the parties hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any New York State court or federal court of the United States
of America sitting in New York City, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this Agreement or any
other Operative Document, or for recognition or enforcement of any judgment, and
each of the parties hereto hereby irrevocably and unconditionally agrees that
all claims in respect of any such action or proceeding may be heard and
determined in any such New York State court or, to the extent permitted by law,
in such federal court. Each of the parties hereto agrees that a final judgment
in any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law. Nothing in this Agreement shall affect any right that any party may
otherwise have to bring any action or proceeding relating to this Agreement or
the Notes in the courts of any jurisdiction.
(c) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have
39
to the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement or any other Operative Document in any New York State
or federal court. Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
SECTION 9.12. Time: Business Day. (a) TIME IS OF THE ESSENCE IN THIS
AGREEMENT, AND THE TERMS HEREIN SHALL BE SO CONSTRUED.
(b) If the date scheduled for any payment or action under any
Operative Document shall not be a Business Day, then (unless such Operative
Document provides otherwise) such payment shall be made or such action shall be
taken on the next succeeding Business Day.
SECTION 9.13. The Trustee. Except for SSBTC's liability for SSBTC's
representations and warranties in Section 4.02, and for its own gross negligence
and willful misconduct and as otherwise provided in the Operative Documents, it
is expressly understood and agreed by the parties hereto that (a) this Agreement
is executed and delivered by SSBTC, not in its individual capacity but solely as
Trustee, under the Declaration, in the exercise of the powers and authority
conferred and vested in it as the Trustee, (b) each of the undertakings and
agreements herein made on the part of the Trustee is made and intended not as a
personal representation, undertaking and agreement by SSBTC but is made and
intended for the purpose for binding only the Trust Estate created by the
Declaration, (c) nothing herein contained shall be construed as creating any
liability on SSBTC, individually or personally, to perform any obligation of the
Trustee either expressed or implied contained herein or in the Operative
Documents, all such liability, if any, being expressly waived by the parties to
this Agreement and by any Person claiming by, through or under the parties to
this Agreement and (d) under no circumstances shall SSBTC be personally liable
for the payment of any indebtedness or expenses of the Trustee or be liable for
the breach or failure of any obligation, representation, warranty or covenant
made or undertaken by the Trustee under this Agreement or the other Operative
Documents.
SECTION 9.14. Transaction Costs; Upfront Fees.
(a) Transaction Costs. Whether or not the transactions contemplated
by this Agreement are consummated, the Company shall pay and hold the Trustee,
the Agent and the Note and Certificate Purchasers harmless against any liability
for the payment of all reasonable fees, expenses, disbursements and
out-of-pocket costs incurred before, on or after the date hereof in connection
with the preparation, execution and delivery of any Operative Document, or any
other agreement, arrangement, document or paper relating to the transactions
contemplated hereby or any amendment or supplement thereto or any waivers or
enforcement thereof, including, but not limited to:
(i) the reasonable fees, expenses and disbursements of each of
the Agent, the Trustee, Trustee's Counsel, Certificate Purchaser's
Counsel, Special Counsel and Special Environmental Counsel for services
rendered to such parties in connection with such transactions;
(ii) the out-of-pocket expenses of each of the Trustee and the
Agent incurred in connection with such transactions;
40
(iii) all fees and expenses in connection with any appraisal,
environmental report, engineering study, survey or inspection of the
Property, or any printing and other document reproduction and distribution
expenses, stamp or other similar Taxes, fees or excises, including
interest and penalties, and all filing fees and Taxes in connection with
the recording or filing of instruments and financing statements in
connection with the transactions described in this Agreement;
(iv) the out-of-pocket expenses of the Trustee and the Agent
in connection with the placement of the Instruments as contemplated
hereby; and
(v) the fees, expenses and disbursements of the Agent, the
Trustee and the Purchasers, including the fees, expenses and disbursements
of their respective counsel, in connection with the enforcement of any
rights of the Purchasers under any of the Operative Documents.
(b) Upfront Fees. On the Amendment Effective Date, the Company shall
pay to the Agent for the account of each Purchaser an extension fee at the rate
of 0.075% on outstanding principal or stated amount, as the case may be, of its
Notes and/or Certificates.
SECTION 9.15. INDEMNIFICATION. (a) THE COMPANY SHALL PAY, PROTECT,
INDEMNIFY AND HOLD HARMLESS EACH INDEMNIFIED PARTY FROM AND AGAINST, AND SHALL
DEFEND ALL ACTIONS AGAINST ANY INDEMNIFIED PARTY WITH RESPECT TO, ANY AND ALL
LIABILITIES (INCLUDING BUT NOT LIMITED TO LIABILITY FOR PATENT OR TRADEMARK
INFRINGEMENT OR MISUSE OR MISAPPROPRIATION OF ANY INTELLECTUAL PROPERTY RIGHTS,
LIABILITY IN TORT (STRICT OR OTHERWISE)), LOSSES, DAMAGES, COSTS, EXPENSES
(INCLUDING BUT NOT LIMITED TO REASONABLE ATTORNEY'S FEES AND EXPENSES OF
COUNSEL), CAUSES OF ACTION, SUITS, CLAIMS, DEMANDS OR JUDGMENTS OF ANY NATURE
WHATSOEVER (COLLECTIVELY, "LOSSES") ARISING FROM (i) ANY INJURY TO, OR DEATH OF,
ANY NATURAL PERSON, OR DAMAGE TO OR LOSS OF PROPERTY, OR ANY MATTERS OCCURRING
ON OR RESULTING FROM ACTIVITIES ON THE PROPERTY OR ANY PART THEREOF; (ii) THE
OWNERSHIP, CONSTRUCTION, LEASING (INCLUDING, WITHOUT LIMITATION, THE FAILURE OF
THE TRUSTEE TO HAVE A MORTGAGE ON THE PROPERTY, THE IMPROVEMENTS OR THE PROPERTY
UNDER THE CIRCUMSTANCES SET FORTH IN PARAGRAPH 20(d) OF THE LEASE), SUBLEASING,
OPERATION, OCCUPANCY, POSSESSION, USE, NON-USE OR CONDITION OF THE PROPERTY OR
ANY PART THEREOF; (iii) ANY VIOLATION BY THE COMPANY OF ANY OF THE TERMS OR
CONDITIONS OF THIS AGREEMENT, THE LEASE OR ANY OF THE OTHER OPERATIVE DOCUMENTS;
(iv) ANY EXERCISE OF RIGHTS OR REMEDIES UPON THE OCCURRENCE OF ANY DEFAULT OR
EVENT OF DEFAULT; (v) ANY ACT OR OMISSION OF THE COMPANY OR ANY OF ITS AGENTS,
CONTRACTORS, LICENSEES, SUBLESSEES, INVITEES, REPRESENTATIVES OR ANY PERSON FOR
WHOSE CONDUCT THE COMPANY IS LEGALLY RESPONSIBLE ON OR RELATING TO OR IN
CONNECTION WITH THE OWNERSHIP, CONSTRUCTION, LEASING, SUBLEASING, OPERATION,
MANAGEMENT, MAINTENANCE,
41
OCCUPANCY, POSSESSION, USE, NON-USE OR CONDITION OF THE PARCEL, THE IMPROVEMENTS
OR THE PROPERTY OR ANY PART THEREOF; (vi) ANY LIENS (INCLUDING, WITHOUT
LIMITATION, ANY PERMITTED ENCUMBRANCES) ON OR WITH RESPECT OF AND TO THE PARCEL
OR THE PROPERTY OR ANY PART THEREOF; (vii) ANY PERMITTED CONTEST REFERRED TO IN
PARAGRAPH 11 OR 18 OF THE LEASE; (viii) ANY VIOLATION BY THE COMPANY OF ANY
FACILITY AGREEMENT OR ANY CONTRACT OR AGREEMENT RELATING TO THE PROPERTY OR THE
TRANSACTIONS TO BE CONSUMMATED PURSUANT TO THE OPERATIVE DOCUMENTS TO WHICH THE
COMPANY IS A PARTY OR OF ANY LEGAL REQUIREMENT OR INSURANCE REQUIREMENT; (ix)
ANY TERMINATION OR INVALIDITY OF THE ▇▇▇▇ OF SALE OR THE DEEDS OR THE TRUSTEE'S
INTEREST IN THE PROPERTY OR THE IMPROVEMENTS (OTHER THAN AS A RESULT OF THE
PURCHASE OF THE PROPERTY BY THE COMPANY) IN EACH CASE AFFECTING ANY INDEMNIFIED
PARTY, THE PARCEL OR THE PROPERTY OR ANY PART THEREOF OR THE OWNERSHIP,
OPERATION, OCCUPANCY, POSSESSION, USE, NON-USE OR CONDITION THEREOF AND IN EACH
CASE REGARDLESS OF THE ACTS, OMISSIONS OR NEGLIGENCE OF ANY INDEMNIFIED PARTY
(IT BEING THE INTENT TO INDEMNIFY EACH INDEMNIFIED PARTY FROM SUCH INDEMNIFIED
PARTY'S OWN NEGLIGENCE EXCEPT AS OTHERWISE SET FORTH IN THE FOLLOWING PROVISO);
PROVIDED, HOWEVER, THAT THE COMPANY SHALL NOT BE REQUIRED TO INDEMNIFY OR HOLD
HARMLESS ANY INDEMNIFIED PARTY HEREUNDER AGAINST ANY SUCH LOSSES TO THE EXTENT
RESULTING FROM FRAUD, GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED
PARTY. FOR PURPOSES OF THIS SECTION 9.15, "INDEMNIFIED PARTY" MEANS EACH OF THE
TRUSTEE (IN BOTH ITS INDIVIDUAL AND FIDUCIARY CAPACITIES), THE AGENT AND THE
HOLDERS FROM TIME TO TIME OF THE INSTRUMENTS, THEIR AFFILIATES, SUCCESSORS AND
ASSIGNS AND ANY OFFICER, DIRECTOR, EMPLOYEE OR AGENT OF ANY OF THE ABOVE.
(b) THE OBLIGATIONS OF THE COMPANY UNDER THIS SECTION 9.15 SHALL
SURVIVE THE EXPIRATION OR ANY TERMINATION OF THE LEASE (WHETHER BY OPERATION OF
LAW OR OTHERWISE) FOR ALL MATTERS DESCRIBED IN THIS SECTION 9.15 WHICH OCCUR OR
ARISE PRIOR TO SUCH EXPIRATION OR TERMINATION OR ARISE OUT OF OR RESULT FROM
FACTS, EVENTS, CLAIMS, LIABILITIES, ACTIONS OR CONDITIONS OCCURRING, ARISING OR
EXISTING ON OR BEFORE SUCH EXPIRATION OR TERMINATION. IN CASE ANY ACTION SHALL
BE BROUGHT AGAINST ANY INDEMNIFIED PARTY IN RESPECT OF WHICH INDEMNITY MAY BE
SOUGHT AGAINST THE COMPANY, SUCH INDEMNIFIED PARTY SHALL PROMPTLY NOTIFY THE
COMPANY IN WRITING, BUT FAILURE TO GIVE SUCH PROMPT NOTICE SHALL NOT RELIEVE THE
COMPANY FROM ANY LIABILITY HEREUNDER, UNLESS THE COMPANY IS PREJUDICED BY THE
FAILURE TO RECEIVE SUCH NOTICE. IF NO DEFAULT OR EVENT OF DEFAULT HAS OCCURRED
AND IS CONTINUING HEREUNDER, THE COMPANY, AT ITS OWN EXPENSE, MAY ELECT TO
ASSUME THE DEFENSE OF ANY ACTION BROUGHT AGAINST AN INDEMNIFIED PARTY, INCLUDING
THE EMPLOYMENT OF COUNSEL REASONABLY SATISFACTORY
42
TO SUCH INDEMNIFIED PARTY AND THE PAYMENT BY THE COMPANY OF ALL EXPENSES
THEREOF. ANY INDEMNIFIED PARTY SHALL HAVE THE RIGHT TO EMPLOY SEPARATE COUNSEL
AT ITS EXPENSE IN ANY SUCH ACTION AND TO CONSULT WITH THE COMPANY REGARDING THE
DEFENSE THEREOF; PROVIDED, HOWEVER, THAT, EXCEPT AS OTHERWISE PROVIDED BELOW,
THE COMPANY SHALL AT ALL TIMES CONTROL SUCH DEFENSE. IF THE COMPANY SHALL HAVE
FAILED TO EMPLOY COUNSEL REASONABLY SATISFACTORY TO THE INDEMNIFIED PARTIES, THE
FEES AND EXPENSES OF THE COUNSEL TO THE INDEMNIFIED PARTIES AS A GROUP SHALL BE
PAID BY THE COMPANY. IF THE COMPANY SHALL ELECT IN WRITING NOT TO ASSUME THE
DEFENSE OR SHALL FAIL TO PROSECUTE DILIGENTLY SUCH DEFENSE THEREOF, AN
INDEMNIFIED PARTY MAY, AFTER WRITTEN NOTICE TO THE COMPANY AND THE COMPANY'S
FAILURE TO REMEDY PROMPTLY THE SAME, ASSUME THE DEFENSE THEREOF, INCLUDING THE
EMPLOYMENT OF COUNSEL, IN WHICH CASE THE COMPANY SHALL PAY ALL OF THE LOSSES OF
SUCH INDEMNIFIED PARTY INCURRED IN RESPECT OF SUCH DEFENSE. IF ANY INDEMNIFIED
PARTY SHALL HAVE BEEN ADVISED BY COUNSEL CHOSEN BY IT THAT THERE MAY BE ONE OR
MORE LEGAL DEFENSES AVAILABLE TO SUCH INDEMNIFIED PARTY THAT ARE DIFFERENT FROM
OR ADDITIONAL TO THOSE AVAILABLE TO THE COMPANY OR THE OTHER INDEMNIFIED PARTIES
OR IT WOULD BE INAPPROPRIATE FOR SUCH COUNSEL TO CONTINUE TO REPRESENT IN
RESPECT OF A PARTICULAR LEGAL OR FACTUAL ISSUE OR OTHERWISE, EACH OF THE
INDEMNIFIED PARTY AND THE COMPANY MAY RETAIN ADDITIONAL AND SEPARATE COUNSEL TO
REPRESENT IT OR, AT ITS OPTION, ASSUME THE DEFENSE OF SUCH ACTION AND THE
COMPANY WILL REIMBURSE SUCH INDEMNIFIED PARTY FOR THE REASONABLE FEES AND
EXPENSES OF ANY COUNSEL RETAINED BY THE INDEMNIFIED PARTY. THE COMPANY SHALL NOT
BE LIABLE FOR ANY SETTLEMENT OF ANY ACTION WITHOUT ITS WRITTEN CONSENT. NO
SETTLEMENT OF ANY SUCH ACTION MAY BE MADE BY THE COMPANY WITHOUT THE INDEMNIFIED
PARTY'S WRITTEN CONSENT; PROVIDED, HOWEVER, SUCH CONSENT SHALL NOT BE NECESSARY
IF THE SETTLEMENT RESULTS IN AN UNCONDITIONAL RELEASE OF THE INDEMNIFIED PARTY
WITHOUT (1) THE ADMISSION BY THE INDEMNIFIED PARTY OF GUILT, COMPLICITY OR
CULPABILITY OR (2) THE INCURRENCE OF ANY PAYMENT OBLIGATION ON THE PART OF SUCH
INDEMNIFIED PARTY WHICH IS NOT PAID AT THE TIME OF SUCH SETTLEMENT BY THE
COMPANY HEREUNDER.
(c) UPON DEMAND FOR PAYMENT BY ANY INDEMNIFIED PARTY OF ANY LOSSES
INCURRED BY IT FOR WHICH INDEMNIFICATION IS SOUGHT, ALONG WITH A BRIEF
DESCRIPTION IN REASONABLE DETAIL OF THE NATURE AND EXTENT OF THE LOSSES AS WELL
AS THE CIRCUMSTANCES UNDER WHICH INDEMNIFICATION IS SOUGHT, THE COMPANY SHALL
PAY WHEN DUE AND PAYABLE THE FULL AMOUNT OF SUCH LOSSES TO THE APPROPRIATE
PARTY, UNLESS AND SO LONG AS (I) THE COMPANY SHALL HAVE ASSUMED THE DEFENSE OF
SUCH ACTION OR IS CONTESTING SUCH LIABILITY, LOSS, DAMAGE, COST, EXPENSE, CAUSE
OF ACTION, SUIT, CLAIM, DEMAND OR
43
JUDGMENT FOR WHICH INDEMNITY IS SOUGHT HEREUNDER AND (II) IS DILIGENTLY
PROSECUTING THE SAME AND THE COMPANY HAS TAKEN ALL ACTION AS MAY BE NECESSARY TO
PREVENT (A) THE COLLECTION OF SUCH LOSSES FROM THE INDEMNIFIED PARTY; (B) THE
SALE, FORFEITURE OR LOSS OF THE PROPERTY OR ANY PART THEREOF DURING SUCH DEFENSE
OF THE SAME ACTION; AND (C) THE IMPOSITION OF ANY CIVIL OR CRIMINAL LIABILITY
FOR FAILURE TO PAY SUCH LOSSES WHEN DUE AND PAYABLE.
(d) THE COMPANY ACKNOWLEDGES AND AGREES THAT (I) ITS OBLIGATIONS
UNDER THIS SECTION 9.15 ARE INTENDED TO INCLUDE AND EXTEND TO ANY AND ALL
LIABILITIES, SUMS PAID IN SETTLEMENT OF CLAIMS, OBLIGATIONS, CHARGES, ACTIONS,
CLAIMS, LIENS, TAXES AND DAMAGES (INCLUDING, WITHOUT LIMITATION, PUNITIVE
DAMAGES, PENALTIES, FINES, COURT COSTS, ADMINISTRATIVE SERVICE FEES, RESPONSE
AND REMEDIATION COSTS, STABILIZATION COSTS, ENCAPSULATION COSTS, TREATMENT,
STORAGE OR DISPOSAL COSTS AND LEGAL FEES INCURRED IN NEGOTIATING WITH
GOVERNMENTAL AGENCIES AND OTHER POTENTIALLY RESPONSIBLE PARTIES AND IN ENFORCING
INDEMNITIES) IMPOSED UPON OR INCURRED BY OR ASSERTED AT ANY TIME AGAINST ANY
INDEMNIFIED PARTY (WHETHER OR NOT INDEMNIFIED AGAINST BY ANY OTHER PARTY)
ARISING DIRECTLY OR INDIRECTLY OUT OF: (A) THE TREATMENT, STORAGE, DISPOSAL,
GENERATION, USE, TRANSPORT, MOVEMENT, PRESENCE, RELEASE, THREATENED RELEASE,
SPILL, INSTALLATION, SALE, EMISSION, INJECTION, LEACHING, DUMPING, ESCAPING OR
SEEPING OF ANY HAZARDOUS MATERIALS OR MATERIAL CONTAINING OR ALLEGED TO CONTAIN
HAZARDOUS MATERIALS AT, ON, UNDER, ONTO, THROUGH OR FROM THE PARCEL OR THE
PROPERTY OR ANY PART THEREOF; (B) THE VIOLATION OR ALLEGED VIOLATION OF ANY
ENVIRONMENTAL LAWS RELATING TO OR IN CONNECTION WITH THE PARCEL OR THE PROPERTY
OR ANY PART THEREOF OR ANY ACTS OR OMISSIONS THEREON OR RELATING THERETO; (C)
ALL OTHER FEDERAL, STATE AND LOCAL LAWS DESIGNED TO PROTECT THE ENVIRONMENT OR
PERSONS OR PROPERTY THEREIN, WHETHER NOW EXISTING OR HEREINAFTER ENACTED,
PROMULGATED OR ISSUED BY ANY FEDERAL, STATE, COUNTY, MUNICIPAL OR OTHER
GOVERNMENTAL AUTHORITY; AND (D) THE COMPANY'S FAILURE TO COMPLY WITH ITS
OBLIGATIONS UNDER PARAGRAPH 2(e) OF THE LEASE AND (II) THE INDEMNIFICATION
PROVIDED FOR UNDER THIS SECTION 9.15(d) SHALL BE GOVERNED BY THE PROCEDURES SET
FORTH IN SECTIONS 9.15(b)-(c) HEREOF.
SECTION 9.16. Operative Documents; Further Assurances. Each of the
parties hereto does hereby covenant and agree to perform and be governed and
restricted by the Operative Documents to which it is a party and, subject to the
terms and conditions thereof, to take or cause to be taken, all actions and to
do, or cause to be done, all things necessary, proper or advisable in connection
therewith. Each of the parties hereto shall have the rights and obligations set
forth in the Declaration with respect to such party notwithstanding that not all
of such parties are signatories thereto. The Company, the Trustee, the Agent and
the Note and Certificate Purchasers
44
will, at the expense of the Company, execute and deliver such further
instruments and do such further acts as may be necessary or proper to carry out
more effectively the purposes of the Operative Documents and the transactions
contemplated thereby. The Company, the Trustee, the Agent and the Note and
Certificate Purchasers may at any time, subject to the conditions and
restrictions contained in the Operative Documents, enter into supplements which
shall form a part hereof, when required or permitted by any of the provisions of
the Operative Documents or to cure any ambiguity, or to cure, correct or
supplement any defective or inconsistent provision contained herein or in any
other Operative Document.
SECTION 9.17. Confidentiality. (a) Each of the parties hereto, other
than Citibank and, as applicable, its Affiliates, agrees that, subject to
Section 6.02, it will maintain the confidentiality of the general structure of
this transaction.
(b) Each of the parties hereto agrees that unless otherwise required
by Law or by any governmental authority or body or consented to by the Company
and Citibank, it will maintain the confidentiality of all non-public information
(i) regarding the financial terms of this transaction or (ii) regarding the
Company or the Property which shall be furnished to it by or on behalf of the
Company in connection with the transactions contemplated by the Operative
Documents, including, without limitation, the as-built plans and specifications
delivered pursuant to Section 5.01(b), in accordance with the procedures it
generally applies to confidential material for a period of three years after all
of the Instruments have been repaid in full, but in no event less than seven
years from the date hereof; provided, however, that if the Lease has been
terminated and the Company has not purchased the Property, then none of the
Purchasers, the Agent nor the Trustee shall be bound by the confidentiality
provisions of this Section 9.17(b).
(c) The parties hereto agree not to publish tombstones or other
public announcements in connection with the transactions contemplated hereby
without the consent of the Company, the Agent and the Purchasers.
SECTION 9.18. Interest. It is the intention of the parties hereto to
conform strictly to all usury Laws that are applicable to each such party,
Purchaser, Note or Certificate or to the transactions contemplated by the
Operative Documents (collectively, the "Transactions"). Accordingly,
notwithstanding anything to the contrary in the Instruments, this Agreement or
any other Operative Document or agreement entered into in connection with the
Transactions (collectively, the "Transaction Documents"), it is agreed as
follows: (i) the aggregate of all consideration which constitutes interest under
Applicable Law (hereinafter defined) that is contracted for, taken, reserved,
charged or received by any party under the Transaction Documents or otherwise in
connection with the Transactions shall under no circumstances exceed the maximum
amount of interest that could lawfully be charged by such party under Applicable
Law, (ii) in the event that the maturity of any indebtedness evidenced by or
payable pursuant to the Transaction Documents is accelerated for any reason, or
in the event of any required or permitted payment or prepayment of all or any
part of such indebtedness (including, without limitation and if applicable, any
required or permitted purchase of the Property, or any required or permitted
payment of the Offer Purchase Price, the Residual Guaranty or Termination
Value), then such consideration that constitutes interest as to any such
indebtedness under Applicable Law may never include more than the maximum amount
allowed by such Applicable Law, and (iii) if under any circumstances the
aggregate amounts paid on any Instruments prior to or incident to the final
45
payment thereof include any amounts which by Applicable Law would be deemed
interest in excess of the maximum amount of interest permitted by Applicable
Law, such excess amounts, if theretofore paid, shall be credited by the
recipient on the principal or stated amount of the affected indebtedness (or, to
the extent that the principal or stated amount of such indebtedness shall have
been or would thereby be paid in full, refunded by such recipient to the party
entitled thereto). If at any time the rate of interest (denominated as such) or
Distributions, as applicable, contractually called for in any Transaction
Document (as the same may vary from time to time pursuant to the terms of such
Transaction Document, the "Stated Rate"), exceeds the maximum non-usurious rate
of interest permitted by Applicable Law (the "Maximum Rate") in respect of the
indebtedness evidenced by such Transaction Document, taking into account all
other amounts paid or payable pursuant to the Transaction Documents which
constitute interest with respect to such indebtedness under Applicable Law
regardless of whether denominated as interest or Distributions (collectively,
the "Other Charges"), then the rate of interest to accrue or Distributions owing
on such indebtedness shall be limited to such Maximum Rate (taking into account
the Other Charges), but any subsequent reduction in the Stated Rate applicable
to such indebtedness shall not reduce the rate of interest or Distributions to
accrue on such indebtedness below such Maximum Rate (taking into account the
Other Charges) until such time as the total amount of interest or Distributions
on such indebtedness equals the amount of interest or Distributions which would
have accrued if the Stated Rate applicable to such indebtedness had at all times
been in effect. If at the maturity or final payment of any indebtedness the
total amount of interest or Distributions paid or accrued on such indebtedness
under the preceding sentence is less than the total amount of interest or
Distributions which would have accrued if the Stated Rate applicable to such
indebtedness had at all times been in effect, then to the fullest extent
permitted by Applicable Law there shall be due and payable or owing with respect
to such indebtedness an amount equal to the excess, if any, of (a) the lesser of
(i) the amount of interest or Distributions (as applicable) which would have
accrued on such indebtedness if such Maximum Rate in respect of such
indebtedness had at all times been in effect and been chosen as the rate of
interest or Distributions to be applicable throughout the term of such
indebtedness (taking into account the Other Charges) and (ii) the amount of
interest or Distributions (as applicable) which would have accrued on such
indebtedness if the Stated Rate applicable to such indebtedness had at all times
been in effect, above (b) the amount of interest or Distributions (as
applicable) accrued in accordance with the provisions of the Transaction
Document evidencing such indebtedness after giving effect to the preceding
sentence. All amounts paid or agreed to be paid for the use, forbearance or
detention of sums pursuant to or in connection with the Transaction Documents
shall, to the extent permitted by Applicable Law, be amortized, prorated,
allocated and spread throughout the full term thereof so that the rate or amount
of interest paid or payable with respect to any amount of indebtedness evidenced
by or payable pursuant to the Transaction Documents does not exceed the
applicable usury ceiling, if any. As used herein, the term "Applicable Law"
means that law, if any, that is applicable to any particular Transaction and
that limits the maximum non-usurious rate of interest that may be taken,
contracted for, charged, reserved or received with respect to such Transaction,
including the law of the State of New York, the law of the State of Texas, the
law of any other jurisdiction that may be mandatorily applicable to such
Transaction notwithstanding other provisions of this Agreement and the other
Transaction Documents, and the Federal law of the United States of America. As
used herein, the term "interest" means interest as determined under Applicable
Law, regardless of whether denominated as interest in the Transaction Documents
(except to the extent that this Section 9.18 specifically refers to interest
denominated as interest). The right to accelerate
46
maturity of any indebtedness evidenced by any Instrument or other Transaction
Document, and the right to demand payment of the Offer Purchase Price, the
Residual Guaranty or Termination Value does not include the right to accelerate
any interest, or to receive any other amounts, which would cause the
Transactions to be usurious under Applicable Law. All computations of the
maximum amount allowed under Applicable Law, as well as all computations of
interest at the Maximum Rate, will be made on the basis of the actual number of
days elapsed over a 365 or 366 day year, whichever is applicable pursuant to
such Applicable Law. The provisions of this Section 9.18 shall prevail over any
contrary provisions in this Agreement, the Instruments or any of the other
Transaction Documents.
SECTION 9.19. WAIVER OF TRIAL BY JURY. IN ANY ACTION OR PROCEEDING
UNDER OR RELATED TO THIS AGREEMENT, THE OPERATIVE DOCUMENTS OR ANY AMENDMENT,
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE
DELIVERED IN CONNECTION WITH THE FOREGOING, THE COMPANY, THE AGENT, THE TRUSTEE
AND EACH NOTE AND CERTIFICATE PURCHASER HEREBY AGREE THAT ANY SUCH ACTION OR
PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY, IRRESPECTIVE OF
WHICH PARTY COMMENCES SUCH ACTION OR PROCEEDING.
SECTION 9.20. Option. At any time prior to the expiration or
termination of the Lease, upon the occurrence of an Environmental Event and at
the direction of the Majority Holders of the B-Notes and Certificates, (i) the
Trustee shall have the right, upon five Business Days' written notice, to
require the Company to purchase all of its right, title and interest in and to
the Property from the Trustee for a purchase price of $1 in which case the
Trustee will convey its right, title and interest in and to the Property to the
Company free and clear of any Lien or other adverse interest of any kind created
by the Trustee or any person claiming by, through or under the Trustee (except
as consented to by the Company and except as to any interest created upon the
exercise of any right under any Operative Document upon any Event of Default).
The exercise by the Trustee of its rights under this Section 9.20 shall not
limit the Trustee's other rights under any Operative Document.
SECTION 9.21. Financial Advisor. The parties hereto acknowledge and
agree that neither Citibank, the Company's exclusive financial advisor for the
transactions contemplated by the Operative Documents, nor any of Citibank's
Affiliates, is making any representation or warranty, or is required to make any
disclosure, now or in the future, with respect to the parties' tax or accounting
treatment of the transactions contemplated by the Operative Documents. Each of
the parties hereto further acknowledges and agrees that neither Citibank nor any
of its Affiliates is responsible, or will be responsible in the future, for tax
and accounting advice with respect to the transactions contemplated by the
Operative Documents, and that it (i) has, independently and without reliance on
Citibank or its Affiliates, made its own analysis and decisions with respect to
such matters and has had the benefit of the advice of its own independent tax
and accounting advisers with respect to such matters to the extent it has deemed
appropriate and (ii) will, independently and without reliance on Citibank or its
Affiliates, continue to make its own analyses and decisions with respect to such
matters based on such information and advice as it deems appropriate for such
purposes.
47
SECTION 9.22. Securities Representation. Each Purchaser hereby
represents that it is acquiring its Instruments for investment for its own
account, and not with a view to or for sale in connection with a distribution of
any Instrument, except in compliance with all applicable securities laws;
provided, however, that, subject to Section 6.02 hereof, the disposition of any
Instrument held by that Purchaser shall at all times be within its exclusive
control.
SECTION 9.23. UNENFORCEABILITY OF ORAL AGREEMENTS; (TEXAS STATUTORY
LANGUAGE). THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THE PARTIES AGREE THAT THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
48
SIGNATURE PAGE FOR AMENDED AND RESTATED PARTICIPATION
AGREEMENT
IN WITNESS WHEREOF the parties have caused this Agreement to be duly
executed by their officers thereunto duly authorized as of the day and year
first above written.
FERRO CORPORATION
By:
---------------------------------
Name: D. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Treasurer
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity,
except as expressly stated herein,
but solely as Trustee
By:
---------------------------------
Name:
Title:
49
SIGNATURE PAGE TO AMENDED AND RESTATED PARTICIPATION
AGREEMENT
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity,
except as expressly stated herein,
but solely as Trustee
By:
---------------------------------
Name:
Title:
50
SIGNATURE PAGE FOR AMENDED AND RESTATED PARTICIPATION
AGREEMENT
CITIBANK, N.A., as Agent
By:
---------------------------------
Name: D. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Treasurer
CITICORP, USA, Inc., as Note
Purchaser and Certificate
Purchaser
By:
---------------------------------
Name:
Title:
51
SIGNATURE PAGE TO AMENDED AND RESTATED PARTICIPATION
AGREEMENT
BANK HAPOALIM B.M., as Note
Purchaser and Certificate
Purchaser
By:
---------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
52
SIGNATURE PAGE TO AMENDED AND RESTATED PARTICIPATION
AGREEMENT
BANK ONE, N.A., as
Note Purchaser
By:
---------------------------------
Name:
Title:
53
SIGNATURE PAGE TO AMENDED AND RESTATED PARTICIPATION
AGREEMENT
NATIONAL CITY BANK, as
Note Purchaser
By:
---------------------------------
Name:
Title:
54
SIGNATURE PAGE TO AMENDED AND RESTATED PARTICIPATION
AGREEMENT
KEY BANK NATIONAL ASSOCIATION, as
Note Purchaser
By:
---------------------------------
Name:
Title:
55
APPENDIX A TO THE PARTICIPATION AGREEMENT
This Appendix A to the Participation Agreement is a glossary of all
or substantially all of the defined terms used in the Operative Documents. Not
all of the terms defined in this Appendix A are used in the Participation
Agreement.
All references herein to one gender shall include the other and all
references to the singular shall include the plural and vice-versa.
"A-Notes" has the meaning set forth in Article I of the Declaration.
"Acquisition" shall mean and include (i) any acquisition on a going
concern basis. (whether by purchase, lease or otherwise) of any facility and/or
business operated by any Person who is not a Subsidiary of the Company, and (ii)
acquisitions of a majority of the outstanding equity or other similar interests
in any such Person (whether by merger, stock purchase or otherwise).
"Act" means the Securities Act of 1933, as amended, and the Laws
promulgated or issued from time to time thereunder.
"Actual Project Costs" has the meaning set forth in Recital E of the
Preliminary Statement to the Participation Agreement.
"Additional Costs" has the meaning set forth in item II of Schedule
B to the Lease.
"Additional Improvements" has the meaning set forth in paragraph
10(a) of the Lease.
"Additional Rent" has the meaning set forth in paragraph 4(b) of the
Lease.
"Adjusted Capitalized Cost" has the meaning set forth in Schedule C
to the Lease.
"Advance" means the advances made by the Note Purchasers to pay
Actual Project Costs.
"Advisory Fee" has the meaning set forth in Section 2.01(e) of the
Participation Agreement.
"Affiliate" when used with respect to a Person, means any other
Person which directly or indirectly through one or more intermediaries controls,
or is controlled by, or is under common control with, such Person. The term
"control" (including the correlative term "controlled") means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of Voting
Stock, by contract or otherwise; provided, however, that under no circumstances
shall the Agent or the Purchasers be deemed to be Affiliates of the Trustee or
vice versa.
"Agency Agreement" has the meaning set forth in Recital C to the
Preliminary Statement to the Participation Agreement.
"Agent" means Citibank, N.A., or any successor selected pursuant to
the Participation Agreement, acting as agent for the Purchasers.
"Allocated Assets" has the meaning set forth in paragraph 14A of the
Lease.
"Allocated Termination Value" has the meaning set forth in paragraph
14A of the Lease.
"Amendment Documents" means the Amended and Restated Participation
Agreement, the First Amendment to Declaration of Trust, the First Amendment to
Lease and the Confirmation of Instrument Guaranty.
"Amendment Effective Date" means November 30, 2000.
"Applicable Law" has the meaning set forth in Section 9.18 of the
Participation Agreement.
"Applicable Margin" means:
(i) with respect to the Notes:
(a) for any Applicable Rate determined by reference to the LIBO
Rate, the applicable percentage shown on Schedule II to the Participation
Agreement based on the debt rating of the Company on the first day of such
Interest Period; and
(b) with respect to any Applicable Rate determined by reference to
the Base Rate, 0%.
(ii) with respect to the Certificates:
(a) for any Applicable Rate determined by reference to the' LIBO
Rate, 3%; and
(b) for any Applicable Rate determined by reference to the Base
Rate, 2.25%.
"Applicable Percentage" has the meaning set forth in Article I of
the Declaration.
"Applicable Permit" means any Permit, including any Environmental
Permit, that is necessary to own, construct, start-up, test, maintain, operate,
lease or use all or any part of the Parcel or the Property or any part thereof
in accordance with the Operative Documents.
"Applicable Rate" means the Applicable Margin plus, subject to
Section 6.01 of the Participation Agreement, either (A) the applicable LIBO Rate
or (B) the Base Rate; provided, however, that the Applicable Rate shall never
exceed the Maximum Rate.
2
"Appraisal" has the meaning set forth in Section 2.01(m) of the
Participation Agreement.
"Appraiser" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co., SC or another appraiser
satisfactory to the Agent and the Majority Holders.
"Approved Construction Budget" means the budget prepared by the
Company, in form and substance satisfactory to the Agent, which budget specifies
the estimated Actual Project Costs including: (a) all labor, materials and
services necessary for the design, engineering, construction (including any fees
which may be due to the Construction Agent), testing and start-up of the
Improvements in accordance with the Construction Plans and (b) all interest and
Distribution expenses, Facility Fees and Upfront Fees anticipated by the Company
incident to the Advances made under the Interim Notes and the Investment made
under the Certificates and the expenses to be incurred in connection with the
design, engineering, procurement, construction, testing and start-up of the
Improvements, as the same may be amended from time to time in accordance with
the provisions of the Participation Agreement and the Agency Agreement.
"Asset Sale" shall mean the sale, transfer or other disposition
(including by means of sale and lease-back transaction, and by means of mergers,
consolidations, and liquidations of a corporation, partnership or limited
liability company of the interests therein of the Company or any Subsidiary) by
the Company or any Subsidiary to any Person other than the Company or any
Subsidiary of any of their respective assets (other than sales, transfers or
other dispositions of inventory, or obsolete or excess furniture, fixtures,
equipment or other property, tangible or intangible, in the ordinary course of
business).
"Assets" has the meaning set forth in Recital A of the Preliminary
Statement to the Participation Agreement.
"Assignee" has the meaning set forth in Section 6.02(b) of the
Participation Agreement.
"Assignor" has the meaning set forth in Section 6.02(b) of the
Participation Agreement.
"Assignment and Acceptance" has the meaning set forth in Article I
of the Declaration.
"Attributable Debt" shall mean, as to any particular lease under
which any Person is at the time liable, at any date as of which the amount
thereof is to be determined, the total net amount of rent required to be paid by
such Person under such lease during the remaining term thereof (after giving
effect to any extensions at the option of the lessor), discounted from the
respective due dates thereof to such date at the rate of 1% per annum over the
interest rate which would then be applicable to a new borrowing of eurodollar
loans under the credit facility evidenced by the general revolving commitments
of the lenders under the Company's Credit Agreement as set forth on Annex I
thereof with an interest period of six months, compounded ( semi-annually. The
net amount of rent required to be paid under any such lease for any such period,
after excluding amounts required to be paid on account of maintenance and
repairs, insurance, taxes, assessments, water rates and similar charges. In the
case of any lease which is
3
terminable by the lessee upon the payment of a penalty, such net amount shall
also include the amount of such penalty, but no rent shall be considered as
required to be paid under such lease subsequent to the first date upon which it
may be so terminated.
"Authorized Officer" shall mean any officer or employee of the
Company designated as such in writing to the Agent by the Company.
"B-Notes" has the meaning set forth in Article I of the Declaration.
"Bankruptcy Law" means Title 11 of the United States Code, and any
applicable Federal, state or local insolvency, reorganization, moratorium,
fraudulent conveyance or similar Law now or hereafter in effect for the relief
of debtors.
"Base Rate" means a fluctuating interest rate per annum as shall be
in effect from time to time which rate per annum shall at all times be equal to
the higher of:
1. the rate of interest announced publicly by Citibank in New York,
New York, from time to time, as its base rate; and
2. one-half of one percent (.5%) per annum above the Federal Funds
Rate.
"Base Rate Funding" means a Funding for which the Applicable Rate is
determined by the Base Rate.
"Bedford Plant" means the production facility of the Company located
in ▇▇▇▇▇▇ Hills, Ohio.
"Best's" means Best's Insurance Reports published by A.M. Best
Company, Inc. or any successor thereto which is a nationally recognized
statistical rating organization.
"▇▇▇▇ of Sale" has the meaning set forth in Recital A to the
Preliminary Statement to the Participation Agreement.
"Break Costs" means an amount equal to the amount (if any) required
to compensate any Purchaser for any losses (including, without limitation, any
loss, cost or expense incurred by reason of the liquidation or redeployment of
deposits or funds acquired by such Purchaser (from third parties including
Affiliates) to fund or maintain such Notes or Certificates) it may incur as a
result of (i) the Company's payment of the Offer Purchase Price, the Residual
Guaranty Fee or Termination Value other than on a Payment Date or (ii) any
purchase of such Purchaser's Notes or Certificates in connection with the
substitution of such Purchaser pursuant to Section 6.04(b) of the Participation
Agreement other than on a Payment Date.
"Business Day" means any day other than a Saturday, Sunday or any
other day on which banking institutions in New York, New York or Boston,
Massachusetts are required or authorized by Law to suspend operations.
4
"Capital Lease" as applied to any Person shall me any lease of any
property (whether real, personal or mixed) by that Person as lessee which, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
"Capitalized Lease Obligations" shall mean all obligations under
Capital Leases of the Company or any of its Subsidiaries in each case taken at
the amount thereof accounted for as liabilities identified as "capital lease
obligations" (or any similar words) on a consolidated balance sheet of the
Company and its Subsidiaries prepared in accordance with GAAP.
"Casualty" has the meaning set forth in paragraph 12(a) of the
Lease.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act, as amended by the Superfund Amendments and
Reauthorization Act, 42 U.S.C. Section 960f1 et seq. and as further amended from
time to time.
"CERCLIS" means the Comprehensive Environmental Response
Compensation and Liability Information System, which is a list maintained by the
United States Environmental Protection Agency of sites where there is a known or
suspected release or potential release of hazardous substances which may require
remediation.
"Certificate Commitment" of any Purchaser means the commitment of
such Person, if any, to make an Investment pursuant to the Certificates up to
the aggregate stated amount set forth below the name of such Person on Schedule
I to the Participation Agreement under the heading "Total Certificate
Commitment," as the same may be adjusted from time to time pursuant to any
Assignment(s) and Acceptance(s) executed by such Purchaser or reduced pursuant
to the terms of the Participation Agreement.
"Certificate Liquidation Amount" has the meaning set forth in
Article I of the Declaration.
"Certificate Percentage" means, with respect to any Certificate
Purchaser, the percentage that its Certificate Commitment bears to the aggregate
Total Certificate Commitment, as such Certificate Percentage may be adjusted
from time to time pursuant to any Assignment(s) and Acceptance(s) executed by
any such Purchaser.
"Certificate Purchaser" means any Purchaser who has a Certificate
Commitment.
"Certificate Purchaser's Counsel" means, collectively, such law
firms, or successors thereto, which from time to time represent the Certificate
Purchasers in connection with the Certificates.
"Certificates" has the meaning set forth in Article I of the
Declaration.
"Change of Control" shall mean and include any of the following:
(i) during any period of two consecutive calendar years,
individuals who at the beginning of such period constituted the
Company's Board of
5
Directors (together with any new directors (x) whose election by the
Company's Board of Directors was, or (y) whose nomination for
election by the Company's shareholders was (prior to the date of the
proxy or consent solicitation relating to such nomination), approved
by a vote of at least two-thirds of the 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), shall cease for any reason to constitute a majority of
the directors then in office;
(ii) any Person or group (as such term is defined in section 1
3(d)(3) of the Securities and Exchange Act of 1934, as amended (the
"1934 Act"), other than the Company, any trustee or other fiduciary
holding securities under an employee benefit plan of the Company and
the Current Holder Group, shall acquire, directly or indirectly,
beneficial ownership (within the meaning of Rule 13d-3 and 13d-5 of
the ▇▇▇▇ ▇▇▇) of more than 50%, on a fully diluted basis, of the
economic or voting interest in the Company's capital stock;
(iii) the shareholders of the Company approve a merger or
consolidation of the Company with any other Person, other than a
merger or consolidation which would result in the voting securities
of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted or
exchanged for voting securities of the surviving or resulting
entity) more than 50% of the combined voting power of the voting
securities of the Company or such surviving or resulting entity
outstanding after such merger or consolidation; and/or
(iv) the shareholders of the Company approve a plan of
complete liquidation of the Company or an agreement or agreements
for the sale or disposition by the Company of all or substantially
all of the Company's assets.
"Charges" means Impositions and all liabilities with respect
thereto, other than Excluded Charges.
"Citibank" has the meaning set forth in the first paragraph of the
Participation Agreement.
"Closing Costs" means all charges incident to any sale of the
Property, including reasonable attorneys' fees of Special Counsel and Trustee's
Counsel and escrow fees, recording fees, broker's fees, any fees, costs
(including, without limitation, Break Costs) or expenses incurred by the Trustee
in connection with the same and with the release of the Declaration, and all
applicable transfer taxes which may be imposed by reason of such sale and
conveyance and the delivery of any and all instruments in connection therewith.
"Closing Date" has the meaning set forth in paragraph 15(a) of the
Lease.
"CNAI" means Citicorp North America, Inc.
"Code" means the Internal Revenue Code of 1986, as amended, and the
Laws promulgated or issued from time to time thereunder.
6
"Commission" has the meaning set forth in Section 4.01(d) of the
Participation Agreement.
"Commitments" means the Certificate Commitments and the Note
Commitments of the respective Purchasers.
"Company" means Ferro Corporation, an Ohio corporation, and any
permitted successor or assignee pursuant to the terms of the Participation
Agreement.
"Company's Credit Agreement" means that certain Credit Agreement
dated as of May 9, 2000 among the Company, the banks parties thereto and
National City Bank, as agent.
"Company's Original Credit Agreement" means that certain Credit
Agreement dated as of August 22, 1990, as amended, among the Company, the banks
parties thereto and National City Bank, as agent.
"Condemnation" has the meaning set forth in paragraph 12(a) of the
Lease.
"Consolidated" refers to the consolidation of the accounts of the
Company with its Subsidiaries in accordance with GAAP and with policies,
including principles of consolidation, consistent with those applied in the
preparation of the consolidated financial statements referred to in Section
4.01(d) of the Participation Agreement.
"Consolidated Amortization Expense" shall mean, for any period, all
amortization expenses of the Company and its Subsidiaries, all as determined for
the Company and its Subsidiaries on a consolidated basis in accordance with
GAAP.
"Consolidated Depreciation Expense" shall mean, for any period, all
depreciation on expenses of the Company and its Subsidiaries, all as determined
for the Company and its Subsidiaries on a consolidated basis in accordance with
GAAP.
"Consolidated EBITDA" shall mean, for any period, Consolidated Net
Income for such period; plus (A) the sum of the amounts for such period included
in determining such Consolidated Net Income of (i) Consolidated Interest
Expense, (ii) Consolidated Income Tax Expense, (iii) Consolidated Depreciation
Expense, (iv) Consolidated Amortization Expense, and (v) non-cash losses and
charges which are properly classified as extraordinary or nonrecurring; less (B)
gains on sales of assets (excluding sales in the ordinary course of business)
and other gains which are properly classified as extraordinary or nonrecurring;
all as determined for the Company and its Subsidiaries on a consolidated basis
in accordance with GAAP.
Notwithstanding the foregoing, in determining Consolidated Net
Income for purposes of this definition there shall be excluded therefrom (i) the
income, (or loss) of any entity (other than Subsidiaries of the Company) in
which the Company or any of its Subsidiaries has a joint interest, except to the
extent of the amount of dividends or other distributions actually paid to the
Company or any of its Subsidiaries during such period, and (ii) the income of
any Subsidiary of the Company to the extent that the declaration or payment of
dividends or similar distributions by that Subsidiary of that income is not at
the time permitted by operation of the terms of its charter or
7
any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to that Subsidiary.
In addition and notwithstanding the foregoing, the Company's
Consolidated EBITDA for any Testing Period shall (x) include the appropriate
financial items for any Person or business unit which has been acquired by the
Company for any portion of such Testing Period prior to the date of acquisition,
and (y) exclude the appropriate financial items for any Person or business unit
which has been disposed of by the Company, for the portion of such Testing
Period prior to the date of disposition.
"Consolidated Income Tax Expense" shall mean, for any period, all
provisions for taxes based on the net income of the Company or any of its
Subsidiaries (including, without limitation, any additions to such taxes, and
any penalties and interest with respect thereto), all as determined for the
Company and its Subsidiaries on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" shall mean, for any period, total
interest expense (including that which is capitalized, that which is
attributable to Capital Leases or Synthetic Leases and the pre-tax equivalent of
dividends payable on Redeemable Stock) of the Company and its Subsidiaries on a
consolidated basis with respect to all outstanding Indebtedness of the Company
and its Subsidiaries including, without limitation, all commissions, discounts
and other fees and charges owed with respect to letters of credit and net costs
under Hedge Agreements, but excluding, however, any amortization or write-off of
deferred financing costs and any charges for prepayment penalties on prepayment
of Indebtedness.
"Consolidated Net Income" shall mean for any period, the net income
(or loss), without deduction for minority interests, of the Company and its
Subsidiaries on a consolidated basis for such period taken as a single
accounting period determined in conformity with GAAP.
"Consolidated Net Tangible Assets" shall mean the aggregate amount
of assets (less applicable reserves and other properly deductible items), after
deducting therefrom (i) all current liabilities (excluding any thereof
constituting Indebtedness by reason of being renewable or extendible for a
maturity longer than one year), and (ii) all goodwill and intangibles, including
trade names, trademarks, patents and unamortized debt discount and expense, all
as determined for the Company and its Subsidiaries on a consolidated basis in
accordance with GAAP.
"Consolidated Net Worth" shall mean at any time for the
determination thereof all amounts which, in conformity with GAAP, would be
included under the caption "total stockholders' equity" (or any like caption) on
a consolidated balance sheet of the Borrower as at such date; provided that in
no event shall Consolidated Net Worth include any amounts in respect of
Redeemable Stock.
"Consolidated Total Debt" shall mean the sum (without duplication)
of all Indebtedness of the Company and of each of its Subsidiaries, all as
determined on a consolidated basis.
"Construction Agent" means the Company, as Construction Agent,
pursuant to the Agency Agreement.
8
"Construction Contract" means any agreements between the Company and
each contractor, pursuant to which such contractors have agreed to construct and
install the Financed Improvements.
"Construction Period" has the meaning set forth in paragraph 3(a) of
the Lease.
"Construction Plans" means the working drawings and specifications
for the construction of the Financed Improvements including, without limitation,
the documentation provided by the Construction Agent, as the same may be amended
from time to time in accordance with the provisions of the Agency Agreement.
"Construction Schedule" means the construction schedule for the
Financed Improvements, as the same may be amended or supplemented from time to
time in accordance with the provisions of the Agency Agreement.
"Conversion Date" means any date on which the basis for the
determination of the Applicable Rate with respect to any Instrument (or any
portion thereof) is converted pursuant to Article VI of the Participation
Agreement or for any other reason pursuant to the terms of the Operative
Documents from the LIBO Rate to the Base Rate or from the Base Rate to the LIBO
Rate, as the case may be.
"Convert," "Conversion" and "Converted" each refers to a conversion
of Base Rate Fundings into LIBO Rate Fundings or LIBO Rate Fundings into Base
Rate Fundings, as the case may be.
"Conveyance Documents" means the Texas Deed, the Ohio Deed, the
Easement, the Second Easement and the ▇▇▇▇ of Sale.
"Corporate Trust Office" has the meaning set forth in Article I of
the Declaration.
"Credit Agreement Closing Date" has the meaning set forth in the
definition of "Existing Indebtedness".
"Credit Documents" shall mean the Company's Credit Agreement and the
notes, the subsidiary guaranty (if executed and delivered) and any letter of
credit document made or issued in connection therewith.
"Current Holder Group" shall mean (i) those Persons who are officers
and directors of the Company at the Effective Date, (ii) the spouses, heirs,
legatees, descendants and blood relatives to the third degree of consanguinity
of any such Person, (iii) the executors and administrators of the estate of any
such Person, and any court appointed guardian of any such Person, and/or (iv)
any trust for the benefit of any such Person referred to in the foregoing
clauses (i) and (ii) or any other Persons, so long as one or more members of the
Current Holder Group has the exclusive right to control the voting and
disposition of securities held by such trust.
"Debt" shall have the meaning provided in Section 5.01(p).
9
"Declaration" or "Declaration of Trust" has the meaning set forth in
Recital D of the Preliminary Statement to the Participation Agreement.
"Deeds" means the Ohio Deed and the Texas Deed.
"Default" means an event which with the lapse of time, the giving of
notice or both would become an Event of Default.
"Default Rate" means the lesser of: (i) the Maximum Rate and (ii) 2%
percent in excess of the Applicable Rate then in effect.
"Distribution" has the meaning set forth in Article I of the
Declaration.
"Domestic Subsidiary" shall mean any Subsidiary organized under the
laws of the United States of America, any State thereof, the District of
Columbia, or any United States possession, the chief executive office and
principal place of business of which is located in, and which conducts the
majority of business within, the United States of America and its territories
and possessions.
"Easement" means the Easement Agreement dated as of the date hereof
among the Company and the Trustee.
"Easement Parcels" means, collectively, the Ohio Easement Parcels,
the Texas Leasehold Parcel and the Texas Easement Parcel.
"Eligible Assignee" means (i) any Person approved by the Agent and
the Company, such approval not to be unreasonably withheld or delayed and (ii)
each financial institution named as a party to the Revolving Credit Facility.
"Employee Benefit Plan" means any employee benefit plan within the
meaning of Section 3(3) of ERISA which the Company or any ERISA Affiliate
administers or administered, operates or operated, contributes to or contributed
to, sponsors or sponsored, or under which the Company or any ERISA Affiliate is
obligated or was obligated for or on behalf of its current or former employees,
officers or directors.
"Environmental Action" means any administrative, regulatory or
judicial action, suit, demand, demand letter, claim, notice of non-compliance or
violation, notice of liability or potential liability, investigation,
proceeding, consent order or consent agreement arising under any Environmental
Law or Environmental Permit or relating to Hazardous Materials or arising from
alleged injury or threat of injury to health, safety or the environment,
including, without limitation, (a) by any governmental or regulatory authority
for enforcement, cleanup, removal, response, remedial or other actions or
damages and (b) by any governmental or regulatory authority or any third party
for damages, contribution, indemnification, cost recovery, compensation or
injunctive relief.
"Environmental Consultant" means ERM-Northeast, Inc. or such other
reputable environmental consulting firm satisfactory to the Agent and the
Purchasers.
10
"Environmental Condition" has the meaning set forth in Recital B to
the Preliminary Statements of the Services Agreement.
"Environmental Event" has the meaning set forth in paragraph 13(a)
of the Lease.
"Environmental Laws" means any and all Federal, state and local Laws
(as well as obligations, duties and requirements relating thereto under common
law) relating to: (a) emissions, discharges, spills, releases or threatened
releases of pollutants, contaminants, Hazardous Materials, materials containing
Hazardous Materials, or hazardous or toxic materials or wastes into ambient air,
surface water, groundwater, watercourses, publicly or privately-owned treatment
works, drains, sewer systems, wetlands, septic systems or onto land; (b) the
use, treatment, storage, disposal, handling, manufacturing, transportation, or
shipment of Hazardous Materials, materials containing Hazardous Materials or
hazardous and/or toxic wastes, material, products or by-products (or of
equipment or apparatus containing Hazardous Materials); (c) pollution or the
protection of human health or the environment; or (d) land use laws.
"Environmental Permit" means any Permit, approval, identification
number, license or other authorization required under any Environmental Law.
"Environmental Trigger" has the meaning set forth in paragraph 13(b)
of the Lease.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, any regulations and the Laws promulgated or issued
from time to time thereunder and any successor legislation.
"ERISA Affiliate" means any Person that for purposes of Title IV of
ERISA is a member of the Company's controlled group, or under common control
with the Company, within the meaning of Section 414 of the Internal Revenue
Code.
"ERISA Event" means (a) the occurrence of a reportable event, within
the meaning of Section 4043 of ERISA, with respect to any Title IV Plan unless
the 30-day notice requirement with respect to such event has been waived by the
PBGC; (b) the application for a minimum funding waiver with respect to a Pension
Plan required to satisfy Code Section 412; (c) the provision by the
administrator of any Title IV Plan of a notice of intent to terminate such plan
pursuant to Section 4041(a)(2) of ERISA (including any such notice with respect
to a plan amendment referred to in Section 4041(e) of ERISA); (d) the cessation
of operations at a facility of the Company or any of its ERISA Affiliates in the
circumstances described in Section 4062(e) of ERISA; (e) the withdrawal by the
Company or any of its ERISA Affiliates from a Multiple Employer Plan during a
plan year for which it was a substantial employer, as defined in Section
4001(a)(2) of ERISA; (f) the failure by the Company or any of its ERISA
Affiliates to make a payment to a Pension Plan if the conditions for the
imposition of a lien under Section 302(f)(1) of ERISA are satisfied; (g) the
adoption of an amendment to a Pension Plan requiring the provision of security
to such Plan, pursuant to Section 307 of ERISA; or (h) the institution by the
PBGC of proceedings to terminate a Title IV Plan, pursuant to Section 4042 of
ERISA, or the occurrence of any event or condition described in Section 4042 of
ERISA that could reasonably be expected to constitute grounds for the
termination of, or the appointment of a trustee to administer, a Title IV Plan;
or the imposition of any liability under Title IV of ERISA, other than for PBGC
premiums
11
due but not delinquent under Section 4007 of ERISA; or (i) the partial
or complete withdrawal within the meaning of Sections 4203 and 4205 of ERISA of
the Company or any ERISA Affiliate from a Multiemployer Plan; or (j) any event
or condition which results in the reorganization or insolvency of a
Multiemployer Plan under Sections 4241 or 4245 of ERISA; (k) any event or
condition which results in the termination of a Multiemployer Plan under Section
4041A of ERISA or the institution by the PBGC of proceedings to terminate a
Multiemployer Plan under Section 4042 of ERISA; or (1) the failure to make any
required contribution to a Title IV Plan.
"Event of Default" has the meaning set forth in Section 7.01 of the
Participation Agreement.
"Excess Funds" has the meaning set forth in paragraph 12(c) of the
Lease.
"Excluded Charges" means (1) Taxes imposed on the Trustee's net
income, and franchise Taxes imposed on it, to the extent such Tax is determined
solely by reference to the fees received by the Trustee under the Operative
Documents; (2) United States federal income Taxes (other than Taxes withheld at
the source) imposed on a Purchaser to the extent that such Tax is determined
solely on the basis that such Purchaser is a creditor entitled to receive only
payments of interest and principal (without discount) for such Tax purposes; (3)
Taxes imposed on a Purchaser's net income and franchise Taxes imposed on it, by
the jurisdiction under the Laws of which it is organized or by any jurisdiction
in which it is doing business or by any political subdivision of the foregoing,
to the extent that such Tax is determined solely on the basis that such
Purchaser is a creditor entitled to receive only payments of interest and
principal (without discount) for such Tax purposes; and (4) any Taxes imposed by
the United States of America by means of withholding at the source if and to the
extent that (a) such Taxes shall be in effect and shall be applicable, on the
date hereof or the effective date of the Assignment and Acceptance pursuant to
which such Person became a Note and/or Certificate Purchaser and (b) such Taxes
are determined solely on the basis that such Purchaser is a creditor entitled to
receive only payments of interest and principal (without discount) for such Tax
purposes; provided, however, that any such Taxes are not incurred or increased
directly or indirectly by actions of the Company on or after the date of the
Participation Agreement (other than actions specifically required of the Company
thereunder or under another Operative Document).
"Existing Indebtedness" shall mean all Indebtedness of the Company
and each of its Subsidiaries, on a consolidated basis, listed on Annex III to
the Company's Credit Agreement, which (i) has an outstanding principal amount of
at least $5,000,000, or may be incurred pursuant to existing commitments or
lines of credit, or (ii) is secured by any Lien on any property of the Company
or any Subsidiary, and which will be outstanding on the closing date of the
Company's Credit Agreement (the "Credit Agreement Closing Date") after giving
effect to any borrowing thereunder which is expected to be made on the Credit
Agreement Closing Date, other than the Indebtedness created under the Credit
Documents (all such Indebtedness, whether or not in a principal amount meeting
such threshold and required to be so listed on such Annex III, herein the
"Existing Indebtedness").
"Expiration Date" has the meaning set forth in paragraph 3 of the
Lease.
12
"Expiration Title Policy" has the meaning set forth in Section
7.05(b) of the Participation Agreement.
"Facility Agreements" has the meaning set forth in paragraph 3(d) of
the Agency Agreement.
"Federal Funds Rate" means, 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 finds transactions with members of 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 Citibank from three Federal funds brokers of recognized
standing selected by it.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System or any successor thereto.
"Fee Parcels" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Final Completion Date" means September 30, 1998.
"Financed Improvements" has the meaning set forth in Recital B of
the Preliminary Statement to the Participation Agreement.
"Financing Closing Date" means October 31, 1995.
"First Amendment to Declaration of Trust" means the First Amendment
to Declaration of Trust dated as of November 30, 2000 by the Trustee.
"First Amendment to Lease" means the First Amendment to Lease dated
as of November 30, 2000 between the Company and the Trustee.
"Fixed Rent" has the meaning set forth in item I.A of Schedule B to
the Lease.
"Funded Debt" shall mean all indebtedness for money borrowed having
a maturity of more than 12 months from the date as of which the amount thereof
is to be determined or having a maturity of less than 12 months but by its terms
being renewable or extendible beyond 12 months from such date at the option of
the borrower or issuer.
"Funding" means a finding of Actual Project Costs specified in an
approved Requisition, which Funding shall consist of Advances and Investments
made by the Purchasers, pursuant to Section 1.04 of the Original Participation
Agreement.
"Funding Costs" means any loss, cost or expense incurred by any Note
or Certificate Purchaser as a result of any failure to fulfill on or before the
date specified in any Requisition the applicable conditions set forth in Article
II of the Participation Agreement, including, without limitation, any loss, cost
or expense incurred by reason of the liquidation or
13
redeployment of deposits or other funds acquired by such Purchaser (from third
parties, including Affiliates) to fund the Advance or make the Investment, as
the case may be, to be made by such Purchaser when such Funding, as a result of
such failure, is not made on such date.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect from time to time; it being understood and agreed
that determinations in accordance with GAAP for purposes of Section 5.01 of the
Participation Agreement, including defined terms as used therein, are subject
(to the extent provided therein) to the following: (A) except as otherwise
specifically provided in the Operative Documents, all terms of an accounting or
financial nature shall be construed in accordance with GAAP, as in effect from
time to time provided that, if the Company notifies the Agent that the Company
requests an amendment to any provision of Section 5.01 of the Participation
Agreement to eliminate the effect of any change occurring after the Amendment
Effective Date in GAAP or in the application thereof to such provision (or if
the Agent notifies the Company that the Majority Purchasers request an amendment
to any such provision hereof for such purposes), regardless of whether any such
notice is given before or after such change in GAAP or in the application
thereof, then such provision shall be interpreted on the basis of GAAP as in
effect and applied immediately before such change shall have become effective
until such notice shall have been withdrawn or such provision amended in
accordance with the requirements of the Participation Agreement, and (B) the
financial statements to be furnished to the Purchasers pursuant to the
Participation Agreement shall be made and prepared in accordance with GAAP
consistently applied throughout the periods involved (except as set forth in the
notes thereto or as otherwise disclosed in writing by the Company to the
Purchasers); provided, that if at any time the computations determining
compliance with Section 5.01 of the Participation Agreement utilize accounting
principles different from those utilized in the financial statements furnished
to the Purchasers, such computations shall set forth in reasonable detail a
description of the differences and the effect upon such computations.
"Guaranty Obligations" shall mean as to any Person (without
duplication) any obligation of such Person guaranteeing any Indebtedness
("primary Indebtedness") of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, including, without limitation, any
obligation of such Person, whether or not contingent, (a) to purchase any such
primary Indebtedness or any property constituting direct or indirect security
therefor, (b) to advance or supply funds (i) for the purchase or payment of any
such primary Indebtedness or (ii) to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (c) to purchase property, securities or services primarily for
the purpose of assuring the owner of any such primary Indebtedness of the
ability of the primary obligor to make payment of such primary Indebtedness, or
(d) otherwise to assure or hold harmless the owner of such primary Indebtedness
against loss in respect thereof; provided, however, that the term Guaranty
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Guaranty
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary Indebtedness in respect of which such Guaranty Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith.
14
"Hazardous Materials" means (1) hazardous materials, hazardous
wastes, and hazardous substances as those or similar terms are defined under any
Environmental Laws, including, but not limited to, the following: the Hazardous
Materials Transportation Act, 49 U.S.C. Section 1801 et seq., as amended from
time to time, the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901
et seq., as amended from time to time, CERCLA, the Clean Water Act, 33
U.S.C. Section 1251 et seq., as amended from time to time, the Clean Air Act, 42
U.S.C. Section 7401 et seq., as amended from time to time and/or the Toxic
Substances Control Act, 15 U.S.C. Section 2601 et seq., as amended from time to
time; (2) petroleum and petroleum products including crude oil and any fractions
thereof; (3) natural gas, synthetic gas, and any mixtures thereof; (4) asbestos
and/or any material which contains any hydrated mineral silicate, including, but
not limited to, chrysolite, amosite, crocidolite, tremolite, anthophylite and/or
actinolite, whether friable or non-friable; (5) polychlorinated biphenyls
("PCB's"), or PCB-containing materials, or fluids; (6) radon; (7) any other
hazardous radioactive, toxic or noxious substance, material, pollutant, or
solid, liquid or gaseous waste; and (8) any substance that, whether by its
nature or its use, is subject to regulation under any Environmental Law or with
respect to which any Federal, state or local Environmental Law or governmental
agency requires environmental investigation, monitoring or remediation.
"Hedge Agreement" shall mean (i) any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other similar
agreement or arrangement designed to protect against fluctuations in interest
rates, (ii) any currency swap agreement, forward currency purchase agreement or
similar agreement or arrangement designed to protect against fluctuations in
currency exchange rates, and (iii) any forward commodity purchase agreement or
similar agreement or arrangement designed to protect against fluctuations in raw
material or other commodity prices.
"Holder" has meaning set forth in Article I of the Declaration.
"Illegality Costs" means any additional amounts as may be necessary
to compensate any Note Purchaser for any losses, costs, interest and fees
incurred by it in making any conversion of Applicable Rate in accordance with
Section 6.01(i) of the Participation Agreement.
"Impositions" means without limitation all Taxes, assessments,
levies, fees, water and sewer rents and charges, inspection fees and other
authorization fees and all other governmental charges, general and special,
ordinary and extraordinary, foreseen and unforeseen, of every character
(including all penalties, additions to tax, fines or interest thereon) arising
directly or indirectly out of the transactions contemplated by the Participation
Agreement and the other Operative Documents, including (i) those which, at any
time prior to or during the Term, may accrue with respect to, be imposed or
levied upon or assessed against or be a Lien upon (A) the Parcel, the Property
or any part thereof, or the Operative Documents, including the Instruments, (B)
the Trustee in connection with the transactions contemplated by the Operative
Documents, or (C) the Deeds, the Lease or the leasehold estate thereby created,
or which arise in respect of the acquisition, ownership, construction,
operation, occupancy, possession, disposition, use, non-use, financing, leasing,
subleasing or condition of the Parcel, the Property or any part thereof or of
the execution, delivery, expiration or termination of the Lease, the Instruments
or any other Operative Document; (ii) those which may be imposed or levied upon,
assessed against or measured by any Fixed Rent, Additional Rent or other sum
payable under the Lease, the Instruments, the Participation Agreement or any
other Operative Document; (iii) all sales, value
15
added, use and similar Taxes at any time levied, assessed or payable on account
of the ownership, operation, occupancy, use, leasing, or subleasing of the
Parcel, the Property or any part thereof; (iv) all charges, levies, fees, rents
or assessments for or in respect of utilities, communications and other services
rendered or used on or about the Parcel, the Property or any part thereof; and
(v) payments in lieu of each of the foregoing.
"Improvements" has the meaning set forth in Recital B of the
Participation Agreement.
"Increased Costs" means any additional amounts, as set forth in a
reasonably detailed certificate submitted to the Company as to the amounts and
basis for such amounts, sufficient to compensate any Purchaser for any increased
costs or reduced return on capital as a result of funding or maintaining such
Purchaser's Notes or Certificates, as the case may be, (including, without
limitation, any such increased costs that are a result of the imposition of any
reserve, special deposit, capital adequacy or similar requirement against assets
of, or deposits with or for the account of, or credit extended by such
Purchaser) as a result of (i) the introduction or implementation after the
Financing Closing Date of any applicable Law or any change therein, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or (ii) the compliance by any Purchaser (or its
purchasing office) with any guideline or request (whether or not having the
force of Law) of any such authority, central bank or comparable agency, which
becomes effective after the date hereof, has the effect of increasing the cost
or reducing the rate of return on capital to any Purchaser in respect of its
agreeing to make, making, funding or maintaining its Notes or Certificates.
Notwithstanding the foregoing, amounts that relate to periods prior to six
months before the Company's receipt of the certificate notifying it of such
amounts shall not constitute "Increased Costs" hereunder.
"Indebtedness" of any Person shall mean without duplication:
(i) all indebtedness of such Person for borrowed money;
(ii) all bonds, notes, debentures and similar debt securities of
such Person;
(iii) the deferred purchase price of capital assets or services
which in accordance with GAAP would be shown on the liability side of the
balance sheet of such Person;
(iv) the face amount of all letters of credit issued for the account
of such Person and, without duplication, all drafts drawn thereunder;
(v) all obligations, contingent or otherwise, of such Person in
respect of bankers' acceptances;
(vi) all Indebtedness of a second Person secured by any Lien on any
property owned by such first Person, whether or not such indebtedness has
been assumed;
(vii) all Capitalized Lease Obligations of such Person;
16
(viii) the present value, determined on the basis of the implicit
interest rate, of all basic rental obligations under all Synthetic Leases
of such Person;
(ix) all obligations of such Person to pay a specified purchase
price for goods or services whether or not delivered or accepted, i.e.,
take-or-pay and similar obligations;
(x) all net obligations of such Person under Hedge Agreements;
(xi) the full outstanding balance of trade receivables, notes or
other instruments sold with full recourse (and the portion thereof subject
to potential recourse, if sold with limited recourse), other than in any
such case any thereof sold for purposes of collection of delinquent
accounts;
(xii) the stated value, or liquidation value if higher, of all
Redeemable Stock of such Person; and
(xiii) all Guaranty Obligations of such Person;
provided that (x) neither trade payables nor other similar accrued expenses, in
each case arising in the ordinary course of business, nor obligations in respect
of insurance policies or performance or surety bonds which themselves are not
guarantees of Indebtedness (nor drafts, acceptances or similar instruments
evidencing the same nor obligations in respect of letters of credit supporting
the payment of the same), shall constitute Indebtedness; and (y) the
Indebtedness of any Person shall in any event include (without duplication) the
Indebtedness of any other entity (including any general partnership in which
such Person is a general partner) to the extent such Person is liable thereon as
a result of such Person's ownership interest in or other relationship with such
entity, except to the extent the terms of such Indebtedness provide expressly
that such Person is not liable thereon.
"Indemnified Party" has the meaning set forth in Section 9.15(a) of
the Participation Agreement.
"Independent Engineer" means Chem Systems, Inc. or any other
construction engineering firm satisfactory to the Agent and the Majority
Purchasers.
"Index Debt" shall mean senior, unsecured, long-term debentures or
other debt securities of the Company that are not guaranteed by any other person
or subject to any other credit support or enhancement.
"Initial Improvements" has the meaning set forth in Recital A to the
Preliminary Statement to the Participation Agreement.
"Initial License Improvements" has the meaning set forth in Recital
A to the Preliminary Statement to the Participation Agreement.
"Initial Ohio Fee Improvements" has the meaning set forth in Recital
A to the Preliminary Statement to the Participation Agreement.
17
"Initial Texas Fee Improvements" has the meaning set forth in
Recital A to the Preliminary Statement to the Participation Agreement.
"Instrument Guaranty" has the meaning set forth in Recital F of the
Preliminary Statement to the Participation Agreement.
"Instruments" has the meaning set forth in Article I of the
Declaration.
"Insufficiency" means, with respect to any Plan, the "unfunded
current liability" of the Plan, within the meaning of Section 412 (or any
successor provision thereto) of the Code.
"Insurance Requirements" has the meaning set forth in paragraph 1(a)
of the Lease.
"Intellectual Property Rights" has the meaning set forth in Section
4.01 (q)(ii) of the Participation Agreement.
"Interest Period" means at any time that the Applicable Rate is
determined by reference to the LIBO Rate,
(i) prior to the Interim Note Maturity Date in the first instance
the period commencing on and including the date of a Funding (in respect
of the Interim Notes and Certificates), including the Financing Closing
Date, and, in the case of each subsequent and successive Interest Period
applicable thereto, respectively, on the last day of the immediately
preceding Interest Period, and
(ii) thereafter the period commencing on and including the Interim
Note Maturity Date and, in the case of each subsequent and successive
Interest Period applicable thereto, on the last day of the immediately
preceding Interest Period,
and, in each case, ending on (x) with respect only to the Short-Term LIBO
Period, the Interim Note Maturity Date or the Expiration Date, as applicable, or
(y) with respect to all periods other than the Short-Term LIBO Period, the same
numerical day in the first, second, third or sixth calendar month thereafter, in
each case to the extent available, as selected by the Company by written notice
(which may, prior to the Interim Note Maturity Date be contained in a
Requisition) to the Agent given at least three (3) Business Days before the
Interest Setting Date with respect to such Interest Period; provided that:
(a) with respect to the Interim Notes, no Interest Period for
any Advance shall extend beyond the Interim Note Maturity Date, and with
respect to the Instruments, no Interest Period shall extend beyond the
Expiration Date;
(b) if any Interest Period would otherwise end on a day which
is not a LIBO Business Day, that Interest Period shall be extended to the
next succeeding LIBO Business Day unless the result of such extension
would be to carry such Interest Period into another calendar month, in
which event such Interest Period shall end on the immediately preceding
LIBO Business Day;
18
(c) for purposes of calculating interest on the Instruments
and/or Fixed Rent for any Interest Period, such calculations shall include
the first day but exclude the last day of any such Interest Period;
(d) any Interest Period that begins on the last LIBO Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last LIBO Business Day of the calendar month at
the end of such Interest Period; and
(e) there may not be more than an aggregate of six (6)
Interest Periods in effect at any one time.
The Company shall select each Interest Period by giving written
notice, whether by Requisition or otherwise, in accordance with Section 6.01(b)
of the Participation Agreement. If the Company fails to provide the written
notice as specified above, the Company shall be deemed to have selected the
Applicable Rate by reference to the Base Rate for the Instruments or the
applicable Advance(s), as the case may be.
"Interest Setting Date" means, (a) with respect to any Interest
Period for which the Applicable Rate is determined by reference to the LIBO
Rate, the date which is three LIBO Business Days before the first day of such
Interest Period or (b) with respect to any period for which the Applicable Rate
is determined by reference to the Base Rate, the date specified by the Company,
in the written notice delivered by the Company pursuant to Section 6.01(a) of
the Participation Agreement, as the first day that such Applicable Rate is to
apply.
"Interim Note Commitment" of any Purchaser means the commitment of
such Person, if any, to make Advances pursuant to the Interim Notes up to the
aggregate principal amount set forth below the name of such Person on Schedule I
to the Participation Agreement under the heading "Interim Note Commitment", as
the same may be adjusted from time to time pursuant to any Assignment(s) and
Acceptance(s) executed by such Purchaser or reduced pursuant to the terms of the
Participation Agreement.
"Interim Note Maturity Date" means the earlier of (i) the Final
Completion Date and (ii) September 30, 1998.
"Interim Note Maturity Formula" means that, on the Interim Note
Maturity Date, (i) A-Notes shall be issued in an aggregate principal amount
equal to (x) the aggregate outstanding principal and stated amount of the
Interim Notes and Series 2 Certificates times (y) .84; and (ii) B-Notes shall be
issued in an aggregate outstanding principal amount equal to (x) the aggregate
principal and stated amount of the Interim Notes and Series 2 Certificates minus
(y) the aggregate outstanding principal and stated amounts of the A-Notes (to be
issued pursuant to clause (i) above) and the Series 2 Certificates.
"Interim Notes" has the meaning set forth in Article I of the
Declaration.
"Interim Trust Estate" has the meaning set forth in Article I of the
Declaration.
19
"Investment" has the meaning set forth in Section 1.01(b) of the
Participation Agreement.
"Investment Grade" shall mean at any date of determination that the
Index Debt of the Company has (i) a rating from Moody's not lower than Baa3 (or
the equivalent thereof used by Moody's) and (ii) a rating from S&P not lower
than BBB(or the equivalent thereof used by S&P).
"ISI" means Insurance Solvency International.
"Law" means any law (including, without limitation, any zoning law
or ordinance, ERISA, any Environmental Law, or Legal Requirements), treaty,
directive, statute, rule, regulation, ordinance, order, directive, code,
interpretation, judgment, decree, injunction, writ, determination, award,
Permit, license, authorization, direction, requirement or decision of or
agreement with or by any government or governmental department, commission,
board, court, authority, agency, official or officer having jurisdiction of the
matter in question.
"Lease" has the meaning set forth in Recital B to the Preliminary
Statement to the Participation Agreement.
"Legal Requirements" has the meaning set forth in paragraph 6(b) of
the Lease.
"Lessee" means the Company, as Lessee under the Lease.
"Lessee Mortgage" has the meaning set forth in paragraph 20(d) of
the Lease.
"Lessor" means the Trustee, as Lessor under the Lease.
"Lessor Group" has the meaning set forth in paragraph 2(b) of the
Lease.
"Lessor Termination Notice" has the meaning set forth in paragraph
l2(b)(ii) of the Lease.
"LIBO Business Day" means a day of the year on which dealings are
carried on in the London interbank market and banks are open for business in
London and not required or authorized to close in New York City.
"LIBO Rate" means, for each Interest Period, an interest rate per
annum equal to the rate of interest per annum at which deposits in United States
dollars (approximately equal in amount to the Notes or the applicable portion
thereof) are offered to leading banks in the London interbank market at 11:00
a.m. (London time) on the Interest Setting Date for a period equal to such
Interest Period determined on the basis of the provisions set forth below:
(A) On the Interest Setting Date, CNAI will determine the interest
rate for deposits in United States dollars for a period equal to that of the
Interest Period to which such Interest Setting Date relates which appears on the
Telerate Page 3750 as of 11:00 a.m. (London time) on such date or if such page
on such service ceases to display such information, such other page as may
replace it on that service for the purpose of display of such information (the
"Telerate
20
Rate"). If such rate does not appear on the Telerate, then the rate will be
determined in accordance with (B) below.
(B) If CNAI is unable to determine the Telerate Rate, then on the
Interest Setting Date, CNAI will determine the arithmetic mean (rounded if
necessary to the nearest one-hundredth percent (1/100%)) of the interest rate
for a period equal to that of the Interest Period to which such Interest Setting
Date relates quoted on Reuters Screen page "LIBO" or (1) if such page on such
service ceases to display such information, such other page as may replace it on
that service for the purpose of displaying such information or (2) if that
service ceases to display such information, such page as displays such
information on such service (or, if more than one, that one approved by the
Agent) as may replace the Reuters Screen, as at or about 11:00 a.m. (London
time) on that Interest Setting Date (the rate quoted as aforesaid being the
"LIBOR Screen Rate"). If CNAI is to make a determination pursuant to this
paragraph and one or more of the LIBO Screen Rates required for such
determination shall be unavailable, the determination shall be made on the basis
of those rates which are available.
"LIBO Rate Funding" means a Funding for which the Applicable Rate is
determined pursuant to the LIBO Rate.
"LIBO Rate Reserve Percentage" for any Interest Period for all LIBO
Rate Fundings means the reserve percentage applicable two Business Days before
the first day of such Interest Period under regulations issued from time to time
by the Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including, without limitation, any
emergency, supplemental or other marginal reserve requirement) for a member bank
of the Federal Reserve System in New York City with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities as defined in
Regulation D (or with respect to any other category of liabilities that includes
deposits by reference to which the interest rate on LIBO Rate Funding is
determined) having a term equal to such Interest Period.
"License Assignment" means the assignment of Synpro's license
interest in the License Parcel to the Trustee.
"License Parcel" has the meaning set forth in Recital A to the
Preliminary Statement to the Participation Agreement.
"Lien" means any deed to secure debt, mortgage, deed of trust,
pledge, security interest, security title, encumbrance, lien, judgment lien,
writ of execution, attachment or charge of any kind, including without
limitation any agreement to give any of the foregoing, any conditional sale or
other title retention agreement, any lease in the nature thereof, and the filing
of or agreement to give, any security interest or financing statements under the
UCC or under any applicable personal property security act or any comparable Law
of any jurisdiction.
"Liquidation Event" has the meaning set forth in Article I of the
Declaration.
"Losses" has the meaning set forth in Section 9.15(a) of the
Participation Agreement.
"Majority Holders" has the meaning set forth in Article I of the
Declaration.
21
"Majority Purchasers" means, at any time, the Purchasers holding at
least 66-2/3% of the aggregate unpaid principal of the Notes and the aggregate
unpaid stated amount of the Certificates.
"Margin Stock" shall have the meaning assigned to that term in
Regulation G and Regulation U.
"Material Adverse Change" means any material adverse change in the
business, condition (financial or otherwise), operations, performance or
properties of the Company or the Company and its Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on any of:
(a) the Company and its Subsidiaries, taken as a whole, or the Company's ability
to perform its obligations under the Operative Documents; (b) the value,
condition, marketability or operation of the Property or the Trustee's ownership
thereof or (c) the validity or enforceability of any of the Operative Documents.
"Maturity Date" has the meaning set forth in Article I of the
Declaration.
"Maximum Budget Amount" has the meaning set forth in paragraph 5(a)
of the Agency Agreement.
"Maximum Rate" has the meaning set forth in Section 9.18 of the
Participation Agreement.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and any successor
thereto which is a nationally recognized credit rating organization.
"Mortgage" shall mean and include any mortgage, pledge, lien,
security interest, conditional sale or other title retention agreement or other
similar encumbrance.
"Multiemployer Plan" means a "multiemployer plan" as defined in
Section 400l(a)(3) (or any successor provision thereto) of ERISA, to which the
Company or any ERISA Affiliate is making or accruing an obligation to make
contributions, or has within any of the preceding five plan years made or
accrued an obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Company or any of its ERISA Affiliates and at least one Person other than the
Company and its ERISA Affiliates or (b) was so maintained and in respect of
which the Company or any of its ERISA Affiliates could have liability under
Section 4064 or 4069 of ERISA in the event such plan has been or were to be
terminated.
"Net Proceeds" has the meaning set forth in paragraph 12(a) of the
Lease.
"1995 Ferro Plant Trust" has the meaning set forth in Section 2.01
of the Declaration.
22
"Notes" has the meaning set forth in Article I of the Declaration.
"Note Commitment" of any Purchaser means such Purchaser's Interim
Note Commitment plus such Purchaser's Series 1 Note Commitment.
"Noteholder" has the meaning set forth in Article I of the
Declaration.
"Note Purchaser" means any Purchaser who has a Note Commitment.
"NPL" has the meaning set forth in Section 4.01 (r)(ii) of the
Participation Agreement.
"Offer Purchase Price" has the meaning set forth in paragraph 15(b)
of the Lease.
"Offer to Purchase" has the meaning set forth in paragraph 14 of the
Lease.
"Officer" of any Person means the president, any vice president or
any other duly authorized and responsible officer of such Person.
"Officer's Certificate" or "Officers' Certificate" of a Person means
a certificate signed by an Officer or Officers of such Person.
"Ohio Deed" means the warranty deed from Synpro to the Trustee
conveying the Ohio Fee Parcel.
"Ohio Easement Parcel" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Ohio Fee Parcels" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Ohio Parcels" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Ohio Plant" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Operating Lease" as applied to any Person shall mean any lease of
any property (whether real, personal or mixed) by that Person as lessee which,
in conformity with GAAP, is not accounted for as a Capital Lease on the balance
sheet of that Person.
"Operative Documents" means the Participation Agreement, the Deeds,
the Agency Agreement, the Lease, the Declaration, the Instruments, the ▇▇▇▇ of
Sale, the Instrument Guaranty and the Services Agreement, the Release Agreement,
the Easement and the Second Easement, each as amended from time to time.
"Original Participation Agreement" means the Participation Agreement
dated as of October 31, 1995 among the Company, the Trustee, the Purchasers and
the Agent.
23
"Original Capitalized Cost" has the meaning set forth in item I.B of
Schedule B to the Lease.
"Other Charges" has the meaning set forth in Section 9.18 of the
Participation Agreement.
"Other Taxes" has the meaning set forth in Section 6.03(c) of the
Participation Agreement.
"Outstanding" with respect to any Instrument, has the meaning set
forth in Article I of the Declaration.
"Parcels" means, collectively, the Fee Parcels, the Easement Parcels
and the License Parcel.
"pari passu" shall mean, when used with reference to the ranking of
any Debt of any person in relation to any other Debt of such person, that each
such Debt (a) either (i) is not subordinate in right of payment to any other
Debt of such person or (ii) is subordinate in right of payment to the same Debt
of such person as is the other and is so subordinate to the same extent and (b)
is not subordinate in right of payment to the other or to any Debt of such
person as to which the other is not so subordinate.
"Partial Lease Termination" has the meaning set forth in Section 14A
of the Lease.
"Partial Lease Termination Closing Date" has the meaning set forth
in Section 14A of the Lease.
"Participation Agreement" means the Amended and Restated
Participation Agreement dated as of October 31, 1995 and amended and restated as
of November 30, 2000 by and among the Company, the Trustee, Citibank, as Agent
and the Purchasers, to which this Appendix is appended, as the same may be
amended, modified or supplemented from time to time.
"Payment Date" means:
(a) With respect to the Interim Notes, (i) the Interim Note Maturity
Date, (ii) each Conversion Date and (iii) the last day of each Interest
Period after the Financing Closing Date through the Interim Note Maturity
Date, but in no event less frequently than quarterly during such period;
(b) With respect to the Series 1 A-Notes and the Series 1 B-Notes,
(i) the Expiration Date, (ii) each Conversion Date and (iii) the last day
of each Interest Period after the Financing Closing Date through the
Expiration Date, but in no event less frequently than quarterly during
such period;
(c) With respect to the Series 2 A-Notes and the Series 2 B-Notes,
(i) the Expiration Date, (ii) each Conversion Date and (iii) the last day
of each Interest Period after the Interim Note Maturity Date through the
Expiration Date, but in no event less frequently than quarterly during
such period;
24
(d) With respect to the Certificates, (i) the Interim Note Maturity
Date and (ii) during the Primary Term, each day that is a Payment Date for
the A-Notes and the B-Notes under clause (b) above; and
(e) With respect to any Note, the maturity date thereof (whether by
acceleration or otherwise).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means any Employee Benefit Plan which is subject to
the provisions of Title IV of ERISA or Section 412 of the Code and which the
Company or any ERISA Affiliate (a) maintains, sponsors, contributes to, is
obligated under, operates or administers for employees of the Company or any
ERISA Affiliate or (b) has, at any lime within the preceding 6 years,
maintained, sponsored, contributed to, been obligated under, operated or
administered for the employees of the Company or any of their current or former
ERISA Affiliates.
"Percentage" means, with respect to any Note Purchaser, the
percentage that its Note Commitment bears to the aggregate Total Note
Commitment, as such Percentage may be adjusted from time to time pursuant to any
Assignment(s) and Acceptance(s) executed by any such Purchaser.
"Permit" means any approval, certificate of occupancy, consent,
waiver, exemption, variance, franchise, order, permit, authorization, right or
license of or from any Federal, state or local government or agency or
subdivision thereof.
"Permitted Encumbrances" means, with respect to the Property, but
only to the extent applicable thereto, any of the following: (i) rights reserved
to or vested in any municipality or public authority, by the terms of any
franchise, grant, license, Permit or provision of Law, to purchase, condemn,
appropriate or recapture, or designate a purchaser of, the Property; (ii) any
liens thereon for Impositions and any liens of mechanics, materialmen and
laborers for work or services performed or materials furnished in connection
with the Property, in each instance, which are not due and payable, or which are
being contested in good faith by the Lessee pursuant to paragraphs 11 and 18 of
the Lease; (iii) rights reserved to or vested in any municipality or public
authority to control or regulate the use of the Property or to use the Property
in any manner; (iv) easements, rights-of-way, servitudes, restrictions and other
minor defects, encumbrances and irregularities in title to the Property which do
not, individually or in the aggregate, materially and adversely affect the
value, condition, marketability or operation of the Property or the Trustee's
ownership thereof; and (v) the Lease, the ▇▇▇▇ of Sale, the Deeds and the
Declaration; and (vi) Liens existing on the Financing Closing Date and set forth
on a Title Policy.
"Permitted Investments" has the meaning set forth in Article I of
the Declaration.
"Permitted Liens" means any of the following:
(i) any mortgage, lien, encumbrance or pledge existing on
October 31, 1995;
25
(ii) any mortgage, lien, encumbrance or pledge given by any
Subsidiary to secure indebtedness owing to the Company or to a wholly
owned Subsidiary of the Company;
(iii) any purchase money mortgage or other lien on property
(other than the Property), real or personal, acquired or constructed by
the Company or any Subsidiary to secure the purchase price of such
property (or to secure indebtedness incurred for the purpose of financing
the acquisition or construction of any such property), or any mortgage or
other lien existing on any such property at the time of acquisition,
whether or not assumed, or any mortgage or other lien existing on any
property of any corporation at the time it becomes a Subsidiary, or any
conditional sales agreement or other title retention agreement with
respect to any property hereafter acquired; provided, however, that the
aggregate principal amount of the indebtedness secured by all such
mortgages and other liens on a particular parcel of property shall not
exceed the cost of such property, including the improvements thereon; and
provided, further, that any such mortgage or lien does not spread to other
property thereafter acquired or constructed other than additions to such
property;
(iv) refundings or extensions of any mortgage, pledge or other
lien or encumbrance permitted by this definition of Permitted Liens for
amounts not exceeding the principal amount of the indebtedness so refunded
or extended at the time of the refunding or extension thereof, and
covering only the same property theretofore securing the same;
(v) any deposit, lien or pledge to enable the Company or any
Subsidiary to exercise any privilege or license, or to secure payments of
workers' compensation, unemployment insurance, old age pensions or other
social security, or to secure the performance of bids, tenders, contracts
or leases to which any such Person is a party, or to secure public or
statutory obligations of any such Person or to secure surety, stay or
appeal bonds to which any such Person is a party; or any other similar
deposit or pledge made in the ordinary course of business;
(vi) any mechanics', workers', repairmen's, materialmen's or
carriers' lien; or any other similar lien arising in the ordinary course
of business; or any deposit or pledge to obtain the release of any such
lien;
(vii) any lien arising out of a judgment or award against the
Company or any subsidiary with respect to which such Person shall in good
faith be prosecuting an appeal or proceedings for review; or any lien
incurred by any such Person for the purpose of obtaining a stay or
discharge in the course of any legal proceeding to which such Person is a
party;
(viii) any lien for taxes contested or not yet subject to
penalties for non-payment, or any minor survey exception, or any minor
encumbrance, easement, or reservation of, or right of another for, any
right of way, sewer, electric line, telegraph and telephone line and other
similar purposes, or any zoning or other restriction as to the use of real
properties, which encumbrances, easements, reservations, rights and
restrictions do
26
not in the aggregate materially detract from the value of said properties
or materially impair their use in the operation of the business of the
Person owning the same;
(ix) any mortgage, security interest or lien that secures
(1) the obligations of the Company to the Purchasers
under this Agreement and the other Operative Documents, or
(2) other Debt of the Company or any such Subsidiary,
provided that in each such case the mortgage, security interest or other
lien shall secure the Company's Debt to the banks under the Revolving
Credit Facility and such other Debt ratably in the proportion of their
respective amounts and the Company shall give the Agent not less than
seven (7) days' prior written notice and shall deliver to the Agent on the
execution date thereof an executed counterpart of the mortgage, security
agreement or other lien instrument and the written opinion of the
Company's counsel as to the Company's compliance with this clause (ix);
(x) any lien, security interest or other charge, encumbrance,
or other type of preferential arrangement that (A) secures obligations of
the Company or any of its Subsidiaries organized in the United States to
their respective former, present or future directors or employees in their
capacities as such or (B) secures obligations of the Company or any of its
Subsidiaries to pay any bank fees, commissions or other charges in respect
of, or reimburse any bank for any draft or other item paid or accepted by
that bank pursuant to or otherwise in respect of, any letter of credit
issued or confirmed by that bank to secure all or any part of the
obligations described in the next preceding clause (A); or
(xi) any mortgage, lien encumbrance or pledge (other than any
permitted by any other clause of this definition of Permitted Liens)
securing Debt that does not exceed in the aggregate $2,500,000 at any one
time outstanding.
"Permitted Receivables Programs" shall have the meaning provided in
Section 5.01(j)(C) of the Participation Agreement.
"Permitted Remediation" has the meaning set forth in paragraph 13(b)
of the Lease.
"Person" means any individual, corporation, limited liability
partnership, limited liability company, partnership, joint venture, association,
joint stock company, trust, unincorporated organization or government.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Plants" has the meaning set forth in Recital A of the Preliminary
Statement to the Participation Agreement.
"Prescribed Forms" means such duly executed form(s) or statement(s),
and in such number of copies, which may, from time to time, be prescribed by Law
and which, pursuant to applicable provisions of (a) an income tax treaty between
the United States and the country of residence of the Purchaser providing the
form(s) or statement(s), (b) the Code, or (c) any
27
applicable rule or regulation under the Code, permit the Company and/or the
Trustee to make payments under the Operative Documents for the account of the
Trustee and/or such Purchaser free of deduction or withholding of income or
similar taxes.
"Primary Term" has the meaning set forth in paragraph 3(a) of the
Lease.
"Principal Domestic Manufacturing Property" shall mean any building,
structure or other facility, together with the land upon which it is erected and
fixtures comprising a part thereof, used primarily for manufacturing, processing
or warehousing of the Company's products and located in the United States of
America, owned or leased by the Company or any Subsidiary, the gross book value
(without deduction of any depreciation reserves) of which on the date as of
which the determination is being made exceeds 1% of Consolidated Net Tangible
Assets, other than any such building, structure or other facility or portion
thereof or any such land or fixture (i) which is financed by obligations issued
by a State, a Territory, or a possession of the United States, or any political
subdivision of any of the foregoing, or the District of Columbia, the interest
on which is excludable from gross income of the holders thereof pursuant to the
provisions of section 745 of Title 48 of the United States Code (or any
successor to such provisions) as in effect at the time of the issuance of such
obligations, or (ii) which, in the opinion of the Board of Directors of the
Company, is not of material importance to the total business conducted by the
Company and its Subsidiaries as an entirety.
"Proceeding" has the meaning set forth in Article I of the
Declaration.
"Proceeds" has the meaning set forth in paragraph 12(a) of the
Lease.
"Proceeds Trustee" has the meaning set forth in paragraph 12(a) of
the Lease.
"Property" has the meaning set forth in Recital B of the Preliminary
Statement to the Participation Agreement.
"Property Charges" means all Impositions other than Excluded Charges
and any income, gross receipts, franchise or similar Taxes.
"Purchase Agreement" has the meaning set forth in Recital B of the
Preliminary Statement to the Participation Agreement.
"Purchasers" has the meaning set forth in the first paragraph of the
Participation Agreement.
"Qualified Sale" has the meaning set forth in paragraph 27(c) of the
Lease.
"Record" has the meaning set forth in Section 6.02(d) of the
Participation Agreement.
"Redeemable Stock" shall mean with respect to any Person any capital
stock or similar equity interests of such Person that (i) is by its terms
subject to mandatory redemption, in whole or in part, pursuant to a sinking
fund, scheduled redemption or similar provisions, at any time prior to the
Maturity Date; or (ii) otherwise is required to be repurchased or retired on a
28
scheduled date or dates, upon the occurrence of any event or circumstance, at
the option of the holder or holders thereof, or otherwise, at any time prior to
the Maturity Date, other than any such repurchase or retirement occasioned by a
"change of control" or similar event.
"Regulation A" means Regulation A of the Federal Reserve Board, as
in effect from time to time.
"Regulation D" means Regulation D of the Federal Reserve Board, as
in effect from time to time.
"Regulation G" means Regulation G of the Federal Reserve Board, as
in effect from time to time.
"Regulation T" means Regulation T of the Federal Reserve Board, as
in effect from time to time.
"Regulation U" means Regulation U of the Federal Reserve Board, as
in effect from time to time.
"Regulation X" means Regulation X of the Federal Reserve Board, as
in effect from time to time.
"Reinvestment Account" has the meaning set forth in Article I of the
Declaration.
"Release Agreement" means the Release Agreement among the Sellers,
the Trustee, the Agent and the Purchasers dated as of October 31, 1995.
"Requisition" means a requisition for Funding delivered in
connection with the Original Participation Agreement.
"Reserve Costs" means, so long as a Note Purchaser shall be required
under regulations of the Federal Reserve Board to maintain reserves with respect
to liabilities or assets consisting of or including Eurocurrency Liabilities (as
defined in Regulation D), additional amounts equal to the product of (1) the
aggregate principal amount of the Notes held by it, multiplied by (2) an
interest rate per annum equal, at all times during the period in which such
reserves were assessed, to the remainder obtained by subtracting (a) the LIBO
Rate for such Interest Period from (b) the rate obtained by dividing such LIBO
Rate for such Interest Period by a percentage equal to 100% minus the LIBO Rate
Reserve Percentage of such Holder, which amounts shall be payable on each
Payment Date.
"Residual Guaranty" has the meaning set forth in Section 7.05(a) of
the Participation Agreement.
"Return Conditions" has the meaning set forth in Section 7.05(b) of
the Participation Agreement.
29
"Revolving Credit Facility" means the $150,000,000 Credit Agreement
dated as of August 22, 1990 among the Company, the banks named therein and
National City Bank as agent, as amended from time to time.
"S&P" means Standard & Poor's Ratings Group, a division of
▇▇▇▇▇▇-▇▇▇▇, Inc. and any successor thereto which is a nationally recognized
credit rating organization.
"sale and lease-back transaction" shall have the meaning provided in
Section 5.01(q) of the Participation Agreement.
"Sales Proceeds" has the meaning set forth in Article I of the
Declaration.
"Second Easement" means the easement agreement with respect to the
Texas Easement Parcels.
"Secured Obligations" means:
(1) Payment when due of all obligations of the Company under
the Instrument Guaranty which accrue to the benefit (directly or
indirectly) of (a) the Holders of the Applicable Percentage of the Interim
Notes, (b) the Holders of the B-Notes, and (c) the Holders of the
Certificates, and the performance and discharge of each and every
obligation of the Company set forth in the Instrument Guaranty which
accrue to the benefit (directly or indirectly) of (i) the Holders of the
Applicable Percentage of the Interim Notes, (ii) the Holders of the
B-Notes, and (iii) the Holders of the Certificates;
(2) Payment of all Fixed Rent and Additional Rent, with
interest, if any, thereon, according to the terms of the Lease, and any
and all extensions, amendments, modifications, substitutions or renewals
thereof, which accrue to the benefit (directly or indirectly) of (a) the
Holders of the Applicable Percentage of the Interim Notes, (b) the Holders
of the B-Notes, and (c) the Holders of the Certificates, and the
performance and discharge of each and every obligation of the Company set
forth in the Lease which accrue to the benefit (directly or indirectly) of
(i) the Holders of the Applicable Percentage of the Interim Notes, (ii)
the Holders of the B-Notes, and (iii) the Holders of the Certificates.
(3) Payment of all other sums, with interest thereon, owing by
the Company and becoming due or payable under the provisions of any of the
Operative Documents which accrue to the benefit (directly or indirectly)
of (a) the Holders of the Applicable Percentage of the Interim Notes, (b)
the Holders of the B-Notes, and (c) the Holders of the Certificates;
(4) Due, prompt and complete observance and performance of
each and every obligation, covenant and agreement of the Company contained
in any of the Operative Documents which accrue to the benefit (directly or
indirectly) of (a) the Holders of the Applicable Percentage of the Interim
Notes, (b) the Holders of the B-Notes, and (c) the Holders of the
Certificates.
"Sellers" means Synpro, ▇▇▇▇▇▇▇ America, Inc. and ▇▇▇▇▇▇▇ Group,
plc.
30
"Series 1 Certificate Commitment" means that portion of the
financing of the acquisition of the Parcels and the Initial Improvements to be
funded by the issuance of Series 1 Certificates on the Financing Closing Date.
"Series 2 Certificate Commitment" means that portion of the
financing of the Financed Improvements to be funded by the issuance of Series 2
Certificates.
"Series 1 Certificates" has the meaning set forth in Article I of
the Declaration.
"Series 2 Certificates" has the meaning set forth in Article I of
the Declaration.
"Series 1 A-Notes" has the meaning set forth in Article I of the
Declaration.
"Series 2 A-Notes" has the meaning set forth in Article I of the
Declaration.
"Series 1 B-Notes" has the meaning set forth in Article I of the
Declaration.
"Series 2 B-Notes" has the meaning set forth in Article I of the
Declaration.
"Series 1 Note Commitment" means that portion of the financing of
the acquisition of the Parcels and the Initial Improvements to be funded by the
issuance of Series 1 Notes.
"Series 1 Notes" has the meaning set forth in Article I of the
Declaration.
"Series 2 Note Commitment" means that portion of the financing of
the acquisition of the Parcels and the Initial Improvements to be funded by the
issuance of Series 2 Notes.
"Series 2 Notes" has the meaning set forth in Article I of the
Declaration. "Series A Maximum Amount" has the meaning set forth in Section 3.02
of the Declaration.
"Series A Portion" has the meaning set forth in item I.B of Schedule
B to the Lease.
"Series A Trust Estate" has the meaning set forth in Article I of
the Declaration.
"Series B Maximum Amount" has the meaning set forth in Section 3.02
of the Declaration.
"Series B Portion" has the meaning set forth in item I.B of Schedule
B to the Lease.
"Series B Trust Estate" has the meaning set forth in Article I of
the Declaration.
"Series C Maximum Amount" has the meaning set forth in Section
3.03(a)(i) of the Declaration.
"Series C Trust Estate" has the meaning set forth in Article I of
the Declaration.
"Series C Portion" has the meaning set forth in item I.B of Schedule
B to the Lease.
31
"Services Agreement" has the meaning set forth in Recital G of the
Preliminary Statement of the Participation Agreement.
"Short-Term LIBO Period" means any period ending on the Interim Note
Maturity Date or the Expiration Date and during which an Applicable Rate
determined by reference to the LIBO Rate for a minimum Interest Period of at
least one month is not available.
"Special Counsel" has the meaning set forth in Article I of the
Declaration.
"Special Environmental Counsel" means ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP or such
other counsel as shall be reasonably satisfactory to the Agent and the
Purchasers.
"SSBTC" has the meaning set forth in the first paragraph of the
Participation Agreement.
"Stated Rate" has the meaning set forth in Section 9.18 of the
Participation Agreement.
"Subordinated Indebtedness" shall mean any Indebtedness which has
been subordinated to the Obligations in such manner and to such extent as the
Agent (acting on instructions from the Majority Purchasers) may require.
"Subsidiary" means any corporation of which at least a majority of
the Voting Stock is at the time owned directly or indirectly by the Company or
by the Company and its other Subsidiaries.
"Subsidiary Guaranty" means a guaranty delivered by any Subsidiary
of the Company pursuant to Section 8.11 of the Company's Credit Agreement.
"Substitute Rate" has the meaning set forth in Section 6.01 of the
Participation Agreement.
"Synpro" means Synthetic Products Company, a Delaware corporation.
"Synthetic Lease" shall mean any lease (i) which is accounted for by
the lessee as an Operating Lease, and (ii) under which the lessee is intended to
be the "owner" of the leased property for federal income tax purposes.
"Tax" or "Taxes" means, without limitation, any fee (including
license, filing, recording, transfer and registration fees), foreign, Federal,
state or local tax (including any income, gross receipts, withholding,
franchise, excise, sales, use, value added, real, personal, tangible or
intangible property tax or any tax similar to any of the foregoing taxes),
interest equalization, recording, transfer or stamp tax, assessment (including
any maintenance charge, owner association dues or charges), levy, impost, duty,
charge or withholding of any kind or nature whatsoever, imposed or assessed by
any foreign, Federal, state or local government or agency, or governmental
authority, together with any addition to tax, penalty, fine or interest thereon.
"Term" has the meaning set forth in paragraph 3 of the Lease.
32
"Termination Notice" has the meaning set forth in paragraph l2(b)(i)
of the Lease.
"Termination Value" has the meaning set forth in Schedule C to the
Lease.
"Testing Period" shall mean for any determination a single period
consisting of the four consecutive fiscal quarters of the Company then last
ended (whether or not such quarters are all within the same fiscal year), except
that if a particular provision of this Agreement indicates that a Testing Period
shall be of a different specified duration, such Testing Period shall consist of
the particular fiscal quarter or quarters then last ended which are so indicated
in such provision.
"Texas Deed" means the warranty deed from Synpro to the Trustee
conveying the Texas Parcel.
"Texas Easement Improvements" has the meaning set forth in Recital A
of the Preliminary Statement to the Participation Agreement.
"Texas Easement Parcels" has the meaning set forth in Recital A of
the Preliminary Statement to the Participation Agreement.
"Texas Leasehold Parcel" has the meaning set forth in Recital A of
the Preliminary Statement to the Participation Agreement.
"Texas Parcel" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Texas Plant" has the meaning set forth in Recital A of the
Preliminary Statement to the Participation Agreement.
"Title Company" means a title company acceptable to the Agent.
"Title IV Plan" means any employee pension benefit plan within the
meaning of Section 3(2) of ERISA, which is covered by Title IV of ERISA.
"Total Commitment" means the aggregate Note Commitments and
Certificate Commitments of all of the Purchasers, not to exceed $25,000,000.
"Total Note Commitment" means the aggregate Note Commitments of all
of the Note Purchasers, not to exceed $24,238,792.52.
"Transaction Documents" has the meaning set forth in Section 9.18 of
the Participation Agreement.
"Transactions" has the meaning set forth in Section 9.18 of the
Participation Agreement.
"Transition Obligation" means the obligation in the amount of $38
million as a non-recurring charge recognized by the Company as of March 31, 1993
as a result of the
33
Company's adoption of an accounting change pursuant to Financial Accounting
Standards Board Statement No. 106, Employer's Accounting for Post-Retirement
Benefits Other Than Pensions.
"Trust Estate" has the meaning set forth in Article I of the
Declaration.
"Trustee" has the meaning set forth in Article I of the Declaration.
"Trustee's Counsel" means ▇▇▇▇▇▇▇ ▇▇▇▇ LLP or such other counsel as
shall be satisfactory to the Trustee.
"UCC" means the Uniform Commercial Code as in effect from time to
time in any jurisdiction whose Law governs the document in which such term is
used and/or rights thereunder.
"Voting Stock" means outstanding shares of stock having voting power
for the election of directors, whether at all times or only so long as no senior
class of stock has such voting power because of default in dividends or some
other default.
"Wholly-Owned Subsidiary" shall mean each Subsidiary of the Company
at least 95% of whose capital stock, equity interests and partnership interests,
other than director's qualifying shares or similar interests, are owned directly
or indirectly by the Company.
"Withdrawal Liability" has the meaning set forth under Part I of
Subtitle E of Title IV of ERISA.
34
FIRST AMENDMENT TO LEASE
FIRST AMENDMENT TO LEASE dated as of November 30, 2000 (this "First
Amendment to Lease") between STATE STREET BANK AND TRUST COMPANY, not in its
individual capacity but solely as Trustee under the Declaration (the "Lessor"),
and FERRO CORPORATION, an Ohio corporation (the "Lessee"). Capitalized terms
used but not defined herein shall have the respective meanings set forth in the
Participation Agreement dated as of October 31, 1995 and amended and restated as
of the date hereof by and among the Lessee, the Lessor, the financial
institutions and Persons named therein and Citibank, N.A. as Agent (as the same
may be amended, modified or supplemented from time to time, the "Participation
Agreement").
PRELIMINARY STATEMENTS
(1) The Lessor and the Lessee are parties to the Lease dated as of
October 31, 1995 (as amended from time to time, the "Lease")
(2) The Lessor and the Lessee have agreed to amend the Lease as set
forth below.
NOW, THEREFORE, the parties agree as follows:
SECTION 1. Amendments to Lease. The Lease shall be amended as
follows:
(a) Paragraph 3 of the Lease is hereby amended to change the
Expiration Date from November 30, 2000 to October 31, 2005.
(b) Paragraph 20 of the Lease is hereby amended by deleting each
reference to "Mortgage" and inserting "Lessee Mortgage" in lieu thereof.
SECTION 2. Confirmation of Lease. Except as herein expressly
amended, the Lease is ratified and confirmed in all respects and shall remain in
full force and effect in accordance with its terms. Each reference in the Lease
to "this Lease", "the Lease", "hereunder", "hereof" or words of like import
referring to the Lease, and each reference in the Participation Agreement, the
Certificates, the Notes or in any other documents delivered in connection
therewith to "the Lease", "thereunder", "thereof" or words of like import
referring to the Lease, shall (unless otherwise specifically provided) mean the
Lease as amended by this First Amendment to Lease, and as hereinafter amended or
restated.
SECTION 3. GOVERNING LAW. THIS FIRST AMENDMENT TO LEASE SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF OHIO.
SECTION 4. Execution in Counterparts. This First Amendment to Lease
may be executed in any number of counterparts and by any combination of the
parties herein in separate counterparts, each of which shall be an original and
all of which when taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this First Amendment
to Lease by telecopier shall be effective as delivery of a manually executed
counterpart of this First Amendment to Lease.
- 2 -
SIGNATURE PAGE FOR FIRST AMENDMENT TO LEASE.
IN WITNESS WHEREOF, the parties hereto have caused this First
Amendment to Lease to be duly executed by their respective Officers thereunto
duly authorized as of the date hereof.
LESSOR:
STATE STREET BANK AND TRUST
COMPANY, as Trustee
Attest:
By:
-------------------------
Name:
Title:
[Seal]
- 3 -
STATE OF __________________ )
: ss:
COUNTY OF _________________ )
On this __ day of October, 2000, before me personally appeared
__________, to me personally known, who being by me duly sworn, did say
that [he/she] is the ____________ of State Street Bank and Trust Company,
and that the seal affixed to the foregoing instrument is the corporate
seal of said corporation and that said instrument was signed and sealed on
behalf of said corporation by authority of its Board of Directors, and
said _____________________acknowledged said instrument to be the free act
and deed of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal at my office in _______________________ the day and year last
above written.
(SEAL)
Printed Name:
---------------------
Notary Public in and for said State
Commissioned in ___________ County
My Commission Expires:
----------------------
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SIGNATURE PAGE FOR FIRST AMENDMENT TO LEASE
LESSEE:
FERRO CORPORATION
Attest: By:
-----------------------
Name: D. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Treasurer
- 5 -
STATE OF OHIO )
) ss:
COUNTY OF CUYAHOGA )
On this 29th day of November, 2000, before me personally appeared D.
▇▇▇▇▇▇ ▇▇▇▇▇▇, to me personally known, who being by me duly sworn, did say that
he is the treasurer of Ferro Corporation, and that the seal affixed to the
foregoing instrument is the corporate seal of said corporation and that said
instrument was signed and sealed on behalf of said corporation by authority of
its Board of Directors, and said officer acknowledged said instrument to be the
free act and deed of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal at my office in Cleveland, Ohio the day and year last above
written.
(SEAL)
--------------------------------------------
Printed Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Notary Public in and for said State of Ohio
Commissioned in Cuyahoga County
My Commission Expires:
September 1, 2002
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