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EXHIBIT 10.4
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PARTICIPATION AGREEMENT
AMONG
NOVELLUS SYSTEMS, INC.
AND
LEASE PLAN U.S.A., INC.
AND
THE PARTICIPANTS NAMED HEREIN
AND
ABN AMRO BANK N.V.,
AS AGENT FOR THE PARTICIPANTS
OCTOBER 15, 1997
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TABLE OF CONTENTS
PAGE
SECTION 1. INTERPRETATION......................................................2
1.01 Definitions.........................................................2
1.02 Rules of Construction...............................................2
SECTION 2. LEASE FACILITIES....................................................2
2.01 Acquisition, Lease, Etc.............................................2
2.02 Participation Agreement.............................................3
2.03 Advance Requests....................................................4
2.04 Fees................................................................6
2.05 Funding of Advances.................................................6
2.06 Sharing of Payments.................................................7
2.07 Other Payment Terms................................................10
2.08 Commitment Reductions..............................................11
2.09 Extensions.........................................................11
2.10 Nature of the Transactions.........................................13
2.11 Security...........................................................14
2.12 Change of Circumstances............................................15
2.13 Taxes on Payments..................................................18
2.14 Funding Loss Indemnification.......................................19
2.15 Replacement of Participants........................................19
SECTION 3. CONDITIONS PRECEDENT...............................................20
3.01 Acquisition Advances...............................................20
3.02 Improvement/Expense Advances.......................................20
3.03 Other Conditions Precedent.........................................20
3.04 Covenant to Deliver................................................21
SECTION 4. REPRESENTATIONS AND WARRANTIES.....................................21
4.01 Lessee's Representations and Warranties............................21
4.02 Lessor's Representations and Warranties............................26
4.03 Participants' Representations and Warranties.......................27
SECTION 5. COVENANTS..........................................................28
5.01 Lessee's Affirmative Covenants.....................................28
5.02 Lessee's Negative Covenants........................................32
5.03 Lessee's Financial Covenants.......................................38
5.04 Lessor's Covenants.................................................40
5.05 Participants' Covenants............................................41
SECTION 6. LESSOR, AGENT AND THEIR RELATIONS WITH PARTICIPANTS................41
6.01 Appointment of Agent...............................................41
6.02 Powers and Immunities..............................................41
6.03 Reliance...........................................................41
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TABLE OF CONTENTS
(Continued)
PAGE
6.04 Defaults...........................................................42
6.05 Indemnification....................................................42
6.06 Non-Reliance.......................................................42
6.07 Resignation or Removal of Agent....................................43
6.08 Authorization......................................................43
6.09 Lessor and Agent in their Individual Capacities....................43
SECTION 7. MISCELLANEOUS......................................................43
7.01. Notices............................................................43
7.02. Expenses...........................................................45
7.03. Indemnification....................................................45
7.04. Waivers; Amendments................................................46
7.05. Successors and Assigns.............................................46
7.06. Setoff.............................................................51
7.07. No Third Party Rights..............................................51
7.08. Partial Invalidity.................................................51
7.09. JURY TRIAL.........................................................51
7.10. Counterparts.......................................................51
7.11. No Joint Venture, Etc..............................................51
7.12. Usury Savings Clause...............................................51
7.13. Confidentiality....................................................52
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SCHEDULES
I Participants (Preamble, 7.01, Schedule 1.01)
II Pricing Grid (Schedule 3.01)
1.01 Definitions
1.02 Rules of Construction
3.01 Initial Conditions Precedent
4.01(g) Litigation
4.01(q) Subsidiaries
4.01(t) Individual Property Representations
5.02(a) Existing Indebtedness
5.02(b) Existing Liens
5.02(e) Existing Investments
EXHIBITS
A Land (2.01(a))
B(1) Facility 1 Lease Agreement (2.01(a))
B(2) Facility 2 Lease Agreement (2.01(b))
C(1) Facility 1 Purchase Agreement (2.01(a))
C(2) Facility 2 Purchase Agreement (2.01(b))
D Facility 2 Construction Agency Agreement (2.01(b))
E Acquisition Request (2.03(a))
F Improvement/Expense Advance Request (2.03(b))
G(1) Commitment Extension Request (2.09(a))
G(2) Lease Extension Request (2.09(b))
H Assignment of Construction Agreements (2.11(a))
I Cash Collateral Agreement (2.11(a))
J Assignment of Lease (2.11(b))
K Lessor Deed of Trust (2.11(b))
L Lessor Security Agreement (2.11(b))
M Assignment Agreement (7.05(b))
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PARTICIPATION AGREEMENT
THIS PARTICIPATION AGREEMENT (this "Agreement" herein), dated as of
October 15, 1997, is entered into by and among:
(1) NOVELLUS SYSTEMS, INC., a California corporation
("Lessee");
(2) LEASE PLAN U.S.A., INC., a Georgia corporation
("Lessor");
(3) Each of the Persons from time to time listed in
Schedule 1 hereto, as amended from time to time (such Persons to be
referred to collectively as the "Participants"); and
(4) ABN AMRO BANK N.V., acting through its San Francisco
International Branch, as agent for the Participants (in such
capacity, "Agent").
RECITALS
A. Lessee has requested Lessor and the Participants to provide to
Lessee two lease facilities as follows:
(1) Pursuant to the first facility ("Facility 1"), Lessor
would (a) purchase certain land designated by Lessee, (b) lease such
land to Lessee, (c) make advances to finance certain related expenses
and (d) grant to Lessee the right to purchase such property.
(2) Pursuant to the second facility ("Facility 2"), Lessor
would (a) purchase the improvements to the Facility 1 Land and other
property designated by Lessee, (b) lease such property to Lessee, (c)
appoint Lessee as Lessor's agent to make certain improvements to such
property and certain of the Facility 1 Land, (d) make advances to
finance such improvements and to pay certain related expenses and (e)
grant to Lessee the right to purchase such property.
(3) The Participants would participate in such lease
facilities by (a) funding the purchase prices and other advances to
be made by Lessor and (b) acquiring participation interests in the
rental and certain other payments to be made by Lessee.
▇. ▇▇▇▇▇▇ and the Participants are willing to provide such lease
facilities upon the terms and subject to the conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the above Recitals and the mutual
covenants herein contained, the parties hereto hereby agree as follows:
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SECTION 1. INTERPRETATION.
1.01. Definitions. Unless otherwise indicated in this Agreement or
any other Operative Document, each term set forth in Schedule 1.01, when used in
this Agreement or any other Operative Document, shall have the respective
meaning given to that term in Schedule 1.01 or in the provision of this
Agreement or other document, instrument or agreement referenced in Schedule
1.01.
1.02. Rules of Construction. Unless otherwise indicated in this
Agreement or any other Operative Document, the rules of construction set forth
in Schedule 1.02 shall apply to this Agreement and the other Operative
Documents.
SECTION 2. LEASE FACILITIES.
2.01. Acquisition, Lease, Etc.
(a) Facility 1. Subject to the terms and conditions of this
Agreement (including the limitations set forth in Subparagraph
2.01(c)):
(i) Lessor shall, on the Closing Date, purchase
(with funds provided by the Participants) the Tracts of
land described in Exhibit A as the Tract 1 Land and the
Tract 2 Land (as more fully defined in Schedule 1.01, the
"Facility 1 Land"), together with any Appurtenant Rights
thereto; and
(ii) Immediately upon the purchase by Lessor of
the Facility 1 Land on the Closing Date, Lessor and Lessee
shall execute (A) a Facility 1 Lease Agreement in the form
of Exhibit B(1) (the "Facility 1 Lease Agreement"),
pursuant to which Lessor will lease to Lessee such property
and (B) a Facility 1 Purchase Agreement in the form of
Exhibit C(1) (the "Facility 1 Purchase Agreement"),
pursuant to which Lessor grants to Lessee the right to
purchase such property.
(b) Facility 2. Subject to the terms and conditions of this
Agreement (including the limitations set forth in Subparagraph
2.01(c)):
(i) Lessor shall, on the Closing Date, purchase
(with funds provided by the Participants) (A) the
Improvements to the Facility 1 Land (as more fully defined
in Schedule 1.01, the "Facility 2 Improvements"), together
with any Appurtenant Rights thereto and any other related
property;
(ii) Immediately upon the purchase by Lessor of
the Facility 2 Improvements on the Closing Date, Lessor and
Lessee shall execute (A) a Facility 2 Lease Agreement in
the form of Exhibit B(2) (the "Facility 2 Lease
Agreement"), pursuant to which Lessor will lease to Lessee
such property, (B) a Facility 2 Purchase Agreement in the
form of Exhibit C(2) (the "Facility 2 Purchase Agreement"),
pursuant to which Lessor grants to Lessee the right to
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purchase such property and (C) a Facility 2 Construction
Agency Agreement in the form of Exhibit D (the "Facility 2
Construction Agency Agreement"), pursuant to which Lessee
agrees to construct certain improvements to the Facility 2
Improvements; and
(iii) During the period beginning on the Closing
Date and ending on the first Business Day of the first full
calendar month immediately succeeding the earliest of (A)
September 30, 1998 (the "Outside Completion Date"), (B) the
Completion Date and (C) the date on which the Unused Total
Commitment is $0 (such first Business Day to be referred to
as the "Commitment Termination Date"), Lessor shall, at the
request of Lessee, make additional advances (with funds
provided by the Participants) to pay Permitted Improvement
Costs and Permitted Transaction Expenses under Facility 2
("Improvement/Expense Advances").
(c) Advance Limitations. The advances made by Lessor to
purchase property under the Facilities (collectively, the
"Acquisition Advances") and the Improvement/Expense Advances made by
Lessor under Facility 2 (the Acquisition Advances and the
Improvement/Expense Advances to be referred to collectively as the
"Advances") shall be made during the period commencing on the date of
this Agreement and ending on the Commitment Termination Date (such
period to be referred to as the "Commitment Period") and shall be
subject to the following limitations:
(i) The aggregate amount of all Advances made
by Lessor under Facility 1 shall not exceed $23,000,000;
(ii) The aggregate amount of all Advances made
by Lessor under Facility 2 shall not exceed $30,000,000;
and
(iii) The aggregate amount of all Advances made
by Lessor under both Facilities shall not exceed Fifty
Million Dollars ($50,000,000) (the "Total Commitment").
Each Advance shall consist of a Tranche A Portion, a Tranche B
Portion and a Tranche C Portion. For accounting purposes, the Tranche
A Portion and Tranche B Portion of each Advance shall constitute debt
and the Tranche C Portion shall constitute equity.
2.02. Participation Agreement.
(a) Advances. Each Participant severally, unconditionally
and irrevocably agrees with Lessor to participate in each Advance
made by Lessor in an amount equal to such Participant's Proportionate
Share of such Advance; provided, however, that the aggregate amount
of each Participant's Proportionate Share of all Advances shall not
exceed such Participant's Commitment. Each Participant shall fund its
Proportionate Share of each Advance as provided in Subparagraph
2.05(a). Each Participant's
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Proportionate Share of each Advance shall consist of such
Participant's Tranche A Portion, Tranche B Portion and Tranche C
Portion of such Advance.
(b) Payments. In consideration of each Participant's
participation in each Advance made by Lessor, such Participant shall
participate in the payments made by Lessee under this Agreement and
the other Operative Documents as provided in Paragraph 2.06.
(c) Other Rights of Participants and Agent.
(i) Until all amounts payable to Agent and
Participants under this Agreement and the other Operative
Documents are paid in full, Lessee shall deliver all
notices for Lessor under this Agreement and the other
Operative Documents to Agent at the office or facsimile
number and during the hours specified in Paragraph 7.01.
Agent shall promptly furnish to Lessor and each Participant
copies of each such notice and, in the case of each request
for an Advance, shall notify each Participant of the amount
of such Participant's Proportionate Share of the Advance
requested thereby.
(ii) Lessor is not an agent for Participants or
Agent and may exercise or refrain from exercising its
rights under this Agreement and the other Operative
Documents in its discretion; provided, however that, until
all amounts payable to Agent and Participants under this
Agreement and the other Operative Documents are paid in
full, (A) Lessor shall, subject to the limitations set
forth in Section VI, be required to act or to refrain from
acting upon instructions of the Required Participants as
provided in Paragraph 6.03 and (B) Agent may exercise any
or all of the rights and remedies of Lessor, and shall be
entitled to the other benefits afforded Lessor, under this
Agreement and the other Operative Documents.
(iii) Neither Agent nor any Participant shall
have any right, title or interest in the Property except
for the Lien therein granted to Agent, for the benefit of
the Participants, in the Lessor Deed of Trust and the
Lessor Security Agreement.
2.03. Advance Requests.
(a) Acquisition Requests. Lessee shall request Lessor to
make each purchase of property under this Agreement by delivering to
Agent an irrevocable written request in the form of Exhibit E,
appropriately completed (an "Acquisition Request"), which specifies,
among other things:
(i) The Facility under which such purchase is
to be made;
(ii) The Property to be purchased;
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(iii) The amount of the requested Acquisition
Advance to be made for such property, including the amount
of the Acquisition Price for such property and the
Permitted Transaction Expenses included in such Acquisition
Advance; and
(iv) The Acquisition Date for such property,
which shall be a Business Day not later than October 31,
1997. (The Facility 1 Land and Facility 2 Improvements
shall be acquired on the same Acquisition Date.)
(b) Improvement/Expense Advance Requests. Lessee shall
request Lessor to make each Improvement/Expense Advance under
Facility 2 by delivering to Lessor:
(i) An irrevocable written request in the form of
Exhibit F, appropriately completed (an "Improvement/Expense
Advance Request"), which specifies, among other things:
(A) The amount of such Advance, which
shall be an integral multiple of $10,000;
(B) The date of such Advance, which
shall be the Closing Date or the first Business
Day of a month; and
(C) The Permitted Improvement Costs
and Permitted Transaction Expenses to be paid by
such Advance; and
(ii) If the proceeds of such Advance are to be
used to purchase Related Goods:
(A) A Supplement to Exhibit B to the
Facility 2 Lease Agreement in the form of Exhibit
B(1) to the Lease Agreement (an "Exhibit B
Supplement"), which contains a detailed
description of such Related Goods; and
(B) Bills of sale for all such Related
Goods showing Lessor as the purchaser.
Lessee shall not request more than one (1) Improvement/Expense
Advance in any calendar month.
(c) Delivery of Advance Requests. Etc. Lessee shall deliver
each Acquisition Request for each Acquisition Advance to Lessor at
least one (1) Business Days before the Closing Date. Lessee shall
deliver each Improvement/Expense Advance Request to Lessor at least
three (3) Business Days before the date of such Advance. The
Acquisition Requests and Improvement/Expense Advance Requests
(collectively, "Advance Requests") shall be delivered by first-class
mail or facsimile as required by Subparagraph
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2.02(c) and Paragraph 7.01; provided, however, that Lessee shall
promptly deliver to Lessor the original of any Advance Request
initially delivered by facsimile.
(d) Capitalization of Base Rent During Commitment Period.
On each Scheduled Rent Payment Date occurring under Facility 2 during
the Commitment Period, the Base Rent due under the Facility 2 Lease
Agreement on such Scheduled Rent Payment Date shall be capitalized by
automatically treating the amount of such Base Rent as an
Improvement/Expense Advance made under Facility 2 on such Scheduled
Rent Payment Date. Agent shall notify Lessor and each Participant of
the amount of the Base Rent due on each such Scheduled Rent Payment
Date and so treated as an Improvement/Expense Advance. Each such
Improvement/Expense Advance shall be allocated to the Improvements to
Tract 2.
2.04. Fees.
(a) Agent's Fees. Lessee shall pay to Agent, for its own
account, agent's fees in the amounts and at the times set forth in
the Agent's Fee Letter (the "Agent's Fees").
(b) Commitment Fees. Lessee shall pay to Agent, for the
ratable benefit of the Participants as provided in clause (ii) of
Subparagraph 2.06(c), commitment fees (the "Commitment Fees") of
fifteen hundredths of one percent (0.15%) per annum on the daily
average Unused Total Commitment for the period beginning on the
Closing Date and ending on the Commitment Termination Date. Lessee
shall pay the Commitment Fees in arrears on the first Business Day in
each January, April, July and October (commencing January 1, 1998)
and on the Commitment Termination Date (or if the Total Commitment is
cancelled on a date prior to such day, on such prior date).
(c) Commitment Extension Fee. If Lessor and the
Participants consent to any extension of the Commitment Termination
Date requested by Lessee pursuant to Subparagraph 2.09(a), Lessee
shall pay to Agent, for the ratable benefit of the Participants as
provided in clause (iii) of Subparagraph 2.06(c), an extension fee
(the "Commitment Extension Fee") equal to ten hundredths of one
percent (0.10%) of the Unused Total Commitment on the date Lessee is
notified by Agent of such consent. Lessee shall pay the Commitment
Extension Fee on or prior to the Business Day immediately preceding
the original Commitment Termination Date.
2.05. Funding of Advances.
(a) Participant Funding and Disbursement. Each Participant
shall, before 11:00 a.m. on the date of each Advance, make available
to Agent at its office specified in Paragraph 7.01, in same day or
immediately available funds, such Participant's Proportionate Share
of such Advance. After Agent's receipt of such funds and upon
fulfillment of the applicable conditions set forth in Section III,
Agent will promptly disburse such funds on behalf of Lessor, in same
day or immediately available funds, as follows:
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(i) Agent shall disburse each Acquisition Advance on
the Closing Date to an escrow or other account established
for payment of the applicable Acquisition Price and any
related Permitted Transaction Expenses pursuant to the
applicable Acquisition Agreement or otherwise as directed by
Lessee in the Advance Request for such Acquisition Advance
to pay such amounts.
(ii) Agent shall disburse each Improvement/Expense
Advance as directed by Lessee in the Advance Request for
such Improvement/Expense Advance.
(b) Participant Failure to Fund. Unless Agent shall have
received notice from a Participant prior to the date of any Advance
that such Participant will not make available to Agent such
Participant's Proportionate Share of such Advance, Agent may assume
that such Participant has made such portion available to Agent on the
date of such Advance in accordance with Subparagraph 2.05(a), and
Agent may, in reliance upon such assumption, disburse the full amount
of such Advance on such date; provided, however, that neither Agent
nor Lessor shall have any obligation to make an Advance requested
hereunder in an amount which exceeds the aggregate amount of funds
actually received by Agent from the Participants on account of their
respective Proportionate Shares of such Advance. If any Participant
does not make the amount of its Proportionate Share of any Advance
available to Agent on or prior to the date such Advance is made, such
Participant shall pay to Agent, on demand, interest which shall
accrue on such amount until made available to Agent at rates equal to
(i) the daily Federal Funds Rate during the period from the date of
such Advance through the third Business Day thereafter and (ii) the
Base Rate plus two percent (2.0%) thereafter. A certificate of Agent
submitted to any Participant with respect to any amounts owing under
this Subparagraph 2.05(b) shall be conclusive absent manifest error.
If any Participant's Proportionate Share of any Advance is not in
fact made available to Agent by such Participant within three (3)
Business Days after the date of such Advance, Lessee shall pay to
Agent, on demand, an amount equal to such Proportionate Share
together with interest thereon, for each day from the date such
amount was made available to Lessee until the date such amount is
repaid to Agent, at a per annum rate equal to the Base Rate plus two
percent (2.0%).
(c) Participants' Obligations Several. The failure of any
Participant to fund its Proportionate Share of any Advance shall not
relieve any other Participant of its obligation hereunder to fund its
Proportionate Share of such Advance, and no Participant shall be
responsible for the failure of any other Participant to fund its
Proportionate Share of any Advance on the date of such Advance.
2.06. Sharing of Payments.
(a) Outstanding Lease Amount. Payments applied to reduce
the Outstanding Lease Amount under each Facility shall be shared as
follows:
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(i) Each payment of the Outstanding Lease Amount under
a Facility derived from the purchase price paid by Lessee to
purchase the Property under such Facility pursuant to the
Purchase Agreement for such Facility shall be shared by the
Participants pro rata according to their respective
Outstanding Participation Amounts under such Facility at the
time of such payment.
(ii) Each payment of the Outstanding Lease Amount under
a Facility derived from:
(A) The Residual Value Guaranty Amount paid by
Lessee pursuant to the Purchase Agreement for such
Facility; or
(B) The Principal Component of Base Rent;
Shall be shared first by the Tranche A Participants pro rata
according to their respective Outstanding Tranche A
Participation Amounts at the time of such payment; second,
if any amounts remain after all Outstanding Tranche A
Participation Amounts are paid in full, by the Tranche B
Participants pro rata according to their respective
Outstanding Tranche B Participation Amounts at the time of
such payment; and third, if any amounts remain after all
Outstanding Tranche A Participation Amounts and all
Outstanding Tranche B Participation Amounts are paid in
full, by the Tranche C Participants pro rata according to
their respective Outstanding Tranche C Participation Amounts
at the time of such payment.
(iii) Each payment of the Outstanding Lease Amount
under a Facility derived from:
(A) the purchase price paid by a
Designated Purchaser to purchase the Property
under such Facility pursuant to the Purchase
Agreement for such Facility;
(B) the Indemnity Amount paid by
Lessee pursuant to the Purchase Agreement for
such Facility; or
(C) Casualty Proceeds or Condemnation
Proceeds related to any of the Property under
such Facility;
Shall be shared first by the Tranche B Participants pro
rata according to their respective Outstanding Tranche B
Participation Amounts at the time of such payment; second,
if any amounts remain after all Outstanding Tranche B
Participation Amounts are paid in full, by the Tranche C
Participants pro rata according to their respective
Outstanding Tranche C Participation Amounts at the time of
such payment; and third, if any amounts remain after all
Outstanding Tranche B Participation Amounts and all
Outstanding Tranche C Participation
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Amounts are paid in full, by the Tranche A Participants
pro rata according to their respective Outstanding Tranche
A Participation Amounts at the time of such payment.
(iv) Each payment of the Outstanding Lease Amount
under a Facility derived from the purchase price paid by
any other Person to purchase the Property under such
Facility (whether after the retention of such Property by
Lessor following the Expiration Date of the Lease Agreement
for such Facility, upon foreclosure or otherwise) shall be
shared first by the Tranche B Participants pro rata
according to their respective Outstanding Tranche B
Participation Amounts at the time of such payment; second,
if any amounts remain after all Outstanding Tranche B
Participation Amounts are paid in full, by the Tranche A
Participants pro rata according to their respective
Outstanding Tranche A Participation Amounts at the time of
such payment; and third, if any amounts remain after all
Outstanding Tranche B Participation Amounts and all
Outstanding Tranche A Participation Amounts are paid in
full, by the Tranche C Participants pro rata according to
their respective Outstanding Tranche C Participation
Amounts at the time of such payment.
(b) Interest Component of Base Rent.
(i) Each payment applied to the Interest
Component of Base Rent under either Facility and
attributable to the Outstanding Tranche A Amount and
Outstanding Tranche B Amount under such Facility shall be
shared by the Tranche A Participants and Tranche B
Participants which funded such Outstanding Tranche A Amount
and Outstanding Tranche B Amounts pro rata according to (i)
the respective Outstanding Tranche A Participation Amounts
and Outstanding Tranche B Participation Amounts of such
Participants and (ii) the dates on which such Participants
so funded such amounts.
(ii) Each payment applied to the Interest
Component of Base Rent under either Facility and
attributable to the Outstanding Tranche C Amount under such
Facility shall be shared by the Tranche C Participants
which funded such Outstanding Tranche C Amount pro rata
according to (i) the respective Outstanding Tranche C
Participation Amounts of such Participants and (ii) the
dates on which such Participants so funded such amounts.
(c) Supplemental Rent. Each payment applied to Supplemental
Rent under either Facility shall be shared by the Lessor Parties as
follows:
(i) Each payment applied to Agent's Fees shall be
solely for the account of Agent.
(ii) Each payment applied to Commitment Fees shall
be shared by the Participants pro rata according to (A)
their respective Proportionate Shares and
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(B) in the case of each Participant which becomes a
Participant hereunder after the date hereof, the date upon
which such Participant so became a Participant.
(iii) Each payment applied to the Commitment
Extension Fee shall be shared by the Participants pro rata
according to their respective Proportionate Shares on the
date of such payment.
(iv) Each payment applied to reimburse any Lessor
Party for any fees, costs and expenses incurred by such
Lessor Party shall be solely for the account of such Lessor
Party.
(v) Each payment of interest (other than Base Rent)
shall be shared among the Lessor Parties owed the amount
upon which such interest accrues pro rata according to (A)
the respective amounts so owed such Lessor Parties and (B)
the dates on which such amounts became owing to such Lessor
Parties.
(vi) All other payments under this Agreement and
the other Operative Documents shall be for the benefit of
the Person or Persons specified.
(d) Disproportionate Payments, Etc. If any Participant
shall obtain any payment (whether voluntary, involuntary, through the
exercise of any right of setoff, or otherwise) on account of amounts
owed to it in excess of its ratable share of payments on account of
such amounts obtained by all Participants entitled to such payments,
such Participant shall forthwith purchase from the other Participants
such participations in the payments to be made under the Operative
Documents as shall be necessary to cause such purchasing Participant
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 Participant, such purchase
shall be rescinded and each other Participant shall repay to the
purchasing Participant the purchase price to the extent of such
recovery together with an amount equal to such other Participant's
ratable share (according to the proportion of (i) the amount of such
other Participant's required repayment to (ii) the total amount so
recovered from the purchasing Participant) of any interest or other
amount paid or payable by the purchasing Participant in respect of
the total amount so recovered. Lessee agrees that any Participant so
purchasing a participation from another Participant pursuant to this
Subparagraph 2.06(d) may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of setoff)
with respect to such participation as fully as if such Participant
were the direct creditor of Lessee in the amount of such
participation.
2.07. Other Payment Terms.
(a) Place and Manner of Payments by Lessee. Lessee shall
make all payments due to any Lessor Party under this Agreement and
the other Operative Documents by payments to Agent, for the account
of such Person, at Agent's office, located at the address specified
in Paragraph 7.01, with each payment due to a Participant to be for
the
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account of such Participant's Applicable Participating Office. Lessee
shall make all payments in lawful money of the United States and in
same day or immediately available funds not later than 11:00 a.m. on
the date due. Agent shall promptly disburse to the appropriate Person
each such payment received by Agent for such Person.
(b) Date. Whenever any payment due under this Agreement or
any other Operative Document shall fall due on a day other than a
Business Day, such payment shall be made on the next succeeding
Business Day, and such extension of time shall be included in the
computation of Rent, interest or fees, as the case may be.
(c) Late Payments. If any amounts required to be paid by
Lessee under this Agreement or any other Operative Document
(including Rent, interest, fees or other amounts) remain unpaid after
such amounts are due, Lessee shall pay interest on the aggregate,
outstanding balance of such amounts from the date due until those
amounts are paid in full at a per annum rate equal to the Base Rate
plus two percent (2.0%), such rate to change from time to time as the
Base Rate shall change.
(d) Application of Payments. All payments under this
Agreement and the other Operative Documents on account of either
Facility shall be applied first to unpaid fees, costs and expenses
then due and payable under this Agreement or any other Operative
Document on account of such Facility, second to the accrued Interest
Component of Base Rent then due and payable under this Agreement or
any other Operative Document on account of such Facility and finally
to the Principal Component of Base Rent or otherwise to reduce the
Outstanding Lease Amount under such Facility. If any payments are not
clearly on account of either Facility, Lessor may apply such payments
to either Facility in its discretion; provided, however, that Lessee
may direct Lessor to apply such payments to the Facility designated
by Lessee if no Default has occurred and is continuing.
(e) Failure to Pay Agent. Unless Agent shall have received
notice from Lessee at least one (1) Business Day prior to the date on
which any payment is due to Lessor or the Participants under this
Agreement or the other Operative Documents that Lessee will not make
such payment in full, Agent may assume that Lessee has made such
payment in full to Agent on such date and Agent may, in reliance upon
such assumption, cause to be distributed to the appropriate Persons
on such due date an amount equal to the amount then due such Persons.
If and to the extent Lessee shall not have so made such payment in
full to Agent, each such Person shall repay to Agent forthwith on
demand such amount distributed to such Person together with interest
thereon, for each day from the date such amount is distributed to
such Person until the date such Person repays such amount to Agent,
at (i) the Federal Funds Rate for the first three (3) days and (ii)
the Base Rate plus two percent (2.0%) thereafter, such rate to change
from time to time as the Base Rate shall change. A certificate of
Agent submitted to any Person with respect to any amounts owing by
such Person under this Subparagraph 2.07(e) shall be conclusive
absent manifest error.
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2.08. Commitment Reductions.
(a) Reduction or Cancellation of Commitments. Lessee may,
at any time prior to the Commitment Termination Date, upon five (5)
Business Days written notice to Lessor, permanently reduce the Total
Commitment by the amount of Five Million Dollars ($5,000,000) or an
integral multiple of One Million Dollars ($1,000,000) in excess
thereof or cancel the Total Commitment in its entirety.
(b) Effect of Commitment Reductions. From the effective
date of any reduction of the Total Commitment, the Commitment Fees
shall be computed on the basis of the Total Commitment as so reduced.
Once reduced or cancelled, the Total Commitment may not be increased
or reinstated without the prior written consent of Lessor and all
Participants. Any reduction of the Total Commitment pursuant to this
Paragraph 2.08 shall be applied ratably to reduce each Participant's
Commitment pro rata in accordance with its Proportionate Share.
2.09. Extensions.
(a) Commitment Extension. Lessee may request Lessor to
extend the Commitment Termination Date for an additional period of
six (6) months by appropriately completing, executing and delivering
to Agent a written request in the form of Exhibit G(1) (a "Commitment
Extension Request"). Lessee shall deliver the Commitment Extension
Request to Agent not more than three (3) months and not less than two
(2) months before the original Commitment Termination Date. Agent
shall promptly deliver to Lessor and each Participant three (3)
copies of each Commitment Extension Request received by Agent. If
Lessor or a Participant, in its sole and absolute discretion,
consents to the Commitment Extension Request, such Person shall
evidence such consent by executing and returning two (2) copies of
the Commitment Extension Request to Agent not later than the last
Business Day which is not less than twelve (12) Business Days prior
to the original Commitment Termination Date. Any failure by Lessor or
any Participant so to execute and return a Commitment Extension
Request shall be deemed a denial thereof. If Lessee shall deliver a
Commitment Extension Request to Lessor pursuant to the first sentence
of this Subparagraph 2.09(a), then not later than ten (10) Business
Days prior to the original Commitment Termination Date, Agent shall
notify Lessee, Lessor and the Participants in writing whether (i)
Agent has received a copy of the Commitment Extension Request
executed by Lessor and each Participant, in which case the definition
of "Commitment Termination Date" set forth in Subparagraph 2.01(i) of
this Agreement shall be deemed extended to the date which is six (6)
months after the original Commitment Termination Date (subject to
receipt by Agent of the Commitment Extension Fee), or (ii) Agent has
not received a copy of the Commitment Extension Request executed by
Lessor and each Participant, in which case such Commitment Extension
Request shall be deemed denied. Lessee acknowledges that neither
Lessor nor any Participant has promised (either expressly or
implicitly), or has any obligation or commitment, to extend or
consent to the extension of the Commitment Termination Date at any
time.
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(b) Lease Extension. Lessee may request Lessor to extend
the original Scheduled Expiration Date of each Lease Agreement for an
additional period of three (3) years by appropriately completing,
executing and delivering to Agent a written request in the form of
Exhibit G(2), together with an attachment thereto setting forth the
terms upon which Lessee would propose for the requested extension (a
"Lease Extension Request"). Lessee shall deliver each Lease Extension
Request to Agent not more than twelve (12) months and not less than
nine (9) months before the original Scheduled Expiration Date. Agent
shall promptly deliver to Lessor and each Participant three (3)
copies of each Lease Extension Request received by Agent. If Lessor
or a Participant, in its sole and absolute discretion, consents to a
Lease Extension Request, such Person shall evidence such consent by
executing and returning two (2) copies of such Lease Extension
Request to Agent not later than the last Business Day which is not
less than seven (7) months prior to the original Scheduled Expiration
Date for the applicable Lease Agreement. Any failure by Lessor or any
Participant so to execute and return a Lease Extension Request shall
be deemed a denial thereof. If Lessee shall deliver a Lease Extension
Request to Lessor pursuant to the first sentence of this Subparagraph
2.09(b), then not later than the last Business Day which is not less
than six (6) months prior to the original Scheduled Expiration Date
for the applicable Lease Agreement, Agent shall notify Lessee, Lessor
and the Participants in writing whether (i) Agent has received a copy
of the Lease Extension Request executed by Lessor and each
Participant, in which case the definition of "Scheduled Expiration
Date" set forth in Subparagraph 2.02(a) of the applicable Lease
Agreement shall be deemed extended to the date which is three (3)
years after the original Scheduled Expiration Date (subject to the
receipt by Agent of any amounts payable by Lessee in connection with
such extension), or (ii) Agent has not received a copy of the Lease
Extension Request executed by Lessor and each Participant, in which
case such Lease Extension Request shall be deemed denied. Lessee
acknowledges that neither Lessor nor any Participant has promised
(either expressly or implicitly), or has any obligation or
commitment, to extend or consent to the extension of the Scheduled
Expiration Date for either Lease Agreement at any time.
2.10. Nature of the Transactions. Lessee and the Lessor Parties
intend that the transactions evidenced by this Agreement and the other Operative
Documents constitute operating leases for accounting purposes and loans secured
by the Property for all other purposes, including federal, state and local
income tax purposes and commercial, real estate and bankruptcy law purposes. To
the extent that this Agreement and the other Operative Documents reflect the
lease form alone, they do so for convenience only. Lessee and the Lessor Parties
intend that the Operative Documents have the dual form referred to in the first
sentence of this paragraph, notwithstanding the use of the lease form alone.
(a) Tax Treatment. For purposes of all income, franchise
and other taxes imposed upon or measured by income, Lessee and Lessor
Parties intend that the transactions evidenced by the Operative
Documents shall be treated as loans by the Participants (through
Lessor) to Lessee secured by the Property, with Lessee as owner of
the Property. Lessee and the Lessor Parties may only take deductions,
credits, allowances
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and other reporting positions on their respective returns, reports and
statements which are consistent with such treatment, unless required
to do otherwise by an appropriate taxing authority or after a clearly
applicable change in applicable Governmental Rules; provided, however,
that if an appropriate taxing authority or a clearly applicable change
in applicable Governmental Rules requires any Lessor Party to take
such an inconsistent position, such Lessor Party shall promptly notify
Lessee.
(b) Other Legal Treatment. For purposes of commercial law,
real property law, bankruptcy law and other applicable laws, Lessee
and Lessor Parties also intend that the transactions evidenced by the
Operative Documents shall be treated as loans by the Participants
(through Lessor) to Lessee secured by the Property, with Lessee as
owner of the Property. Consistent with such treatment, Lessee and the
Lessor Parties intend that, among other things for such purposes, (i)
the Advances be treated as loans to Lessee by the Participants
(through Lessor); (ii) the Advances be secured by the Property and
the Lessor Parties have the rights and remedies of secured lenders;
(iii) Base Rent be treated as interest on the Advances; (iv) Lessee
be required to pay on the applicable Expiration Date only the
Residual Value Guaranty Amount, the Indemnity Amount and the other
amounts required by Subparagraph 4.06(b) of the applicable Purchase
Agreement (or Subparagraph 4.06(c) if Lessor is retaining the
Property) if Lessee exercises the Marketing Option in accordance with
the applicable Purchase Agreement; and (v) Lessee be required to pay
on the applicable Expiration Date the applicable Outstanding Lease
Amount and all other amounts outstanding under this Agreement and the
other Operative Documents (including amounts required by Subparagraph
4.06(a) of the applicable Purchase Agreement) if the applicable Lease
Agreement is terminated prior to its Scheduled Expiration Date after
an Event of Default occurs under such Lease Agreement or if Lessee
fails to or is otherwise not entitled to exercise the Marketing
Option in accordance with the applicable Purchase Agreement.
(c) No Reliance by Lessee. Lessee acknowledges and agrees
that no Lessor Party has made any representations or warranties to
Lessee concerning the tax, accounting or legal characteristics of the
Operative Documents and that Lessee has obtained and relied upon such
tax, accounting and legal advice concerning the Operative Documents
as it deems appropriate.
2.11. Security.
(a) Lessee Obligations.
(i) To the extent that the transaction evidenced by the
Lease Agreement, Purchase Agreement and other Operative
Documents for either Facility is treated as a loan by the
Participants (through Lessor) to Lessee secured by the
Property for such Facility, with Lessee as owner of such
Property pursuant to Paragraph 2.10, the Lessee Obligations
under such Facility shall be secured by such Property and
the other Real Property Collateral for such Facility and, in
the case of Facility 2, Personal Property Collateral for
such Facility (collectively, the
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"Property Collateral") as provided in Subparagraphs 2.07(a)
and 2.07(b) of the applicable Lease Agreement and, in the
case of Facility 2, in an Assignment of Construction
Agreements in the form of Exhibit H, duly executed by Lessee
(the "Assignment of Construction Agreements").
(ii) In addition to the Property Collateral for each
Facility, the Lessee Obligations under each Facility may be
secured, at Lessee's election, by a Cash Collateral
Agreement in the form of Exhibit I, duly executed by Lessee
(the "Cash Collateral Agreement") , and Cash Collateral
delivered to Agent or Participants pursuant to the Cash
Collateral Agreement. If Lessee elects to deliver any Cash
Collateral pursuant to the Cash Collateral Agreement to
decrease the Applicable Margin for the LIBOR Rental Rate
under a Lease Agreement, Lessee shall deliver to Agent, five
(5) Business Days' prior to the delivery of such Cash
Collateral, notice of such election and an opinion of its
counsel in form and substance reasonably satisfactory to
Lessor regarding the Cash Collateral Agreement and such Cash
Collateral and shall deliver such Cash Collateral only on a
Scheduled Rent Payment Date under the applicable Lease
Agreement. Lessee may withdraw any Cash Collateral held
pursuant to the Cash Collateral Agreement only as provided
in the Cash Collateral Agreement.
(iii) Lessee shall deliver to Lessor and Agent such
additional mortgages, deeds of trust, security agreements,
pledge agreements, lessor consents and estoppels (containing
appropriate mortgagee and lender protection language) and
other instruments, agreements, certificates, opinions and
documents (including Uniform Commercial Code financing
statements and fixture filings and landlord waivers) as
Lessor or Agent may reasonably request to (A) grant,
perfect, maintain, protect and evidence security interests
in favor of Lessor or Agent in the Property Collateral and
Cash Collateral prior to the Liens or other interests of any
Person, except in the case of the Property Collateral for
Permitted Property Liens; and (B) otherwise establish,
maintain, protect and evidence the rights provided to Lessor
and Agent in the Property Collateral and Cash Collateral.
Lessee shall fully cooperate with Lessor and Agent and
perform all additional acts reasonably requested by Lessor
or Agent to effect the purposes of this Subparagraph
2.11(a).
(b) Lessor Obligations.
(i) The Lessor Obligations shall be secured by the
following:
(A) An Assignment of Lease Agreement and Purchase
Agreement in the form of Exhibit J, duly executed by
Lessor (the "Assignment of Lease");
(B) A Construction Deed of Trust with Assignment
of Rents, Security Agreement and Fixture Filing in the
form of Exhibit K, duly executed by Lessor (the "Lessor
Deed of Trust"); and
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(C) A Security Agreement in the form of Exhibit L,
duly executed by Lessor (the "Lessor Security
Agreement").
(ii) Lessor shall deliver to Agent such additional
mortgages, deeds of trust, security agreements, pledge
agreements, lessor consents and estoppels (containing
appropriate mortgagee and lender protection language) and
other instruments, agreements, certificates, opinions and
documents (including Uniform Commercial Code financing
statements and fixture filings and landlord waivers) as
Agent may reasonably request to (A) grant, perfect,
maintain, protect and evidence security interests in favor
of Agent in Lessor's rights in the Property Collateral and
Cash Collateral; and (B) otherwise establish, maintain,
protect and evidence the rights provided to Agent in the
Property Collateral and Cash Collateral. Lessor shall fully
cooperate with Agent and perform all additional acts
reasonably requested by Agent to effect the purposes of this
Subparagraph 2.11(b).
(iii) Lessee hereby consents to the Assignment of
Lease, the Lessor Deed of Trust and the Lessor Security
Agreement; the Liens granted to Agent therein; and all other
Liens granted to Agent in any of the Operative Documents and
the Property to secure the Lessor Obligations.
2.12. Change of Circumstances.
(a) Inability to Determine Rates. If, on or before the
first day of any Rental Period, (i) any Participant shall advise
Agent that the LIBOR Rental Rate for such Rental Period cannot be
adequately and reasonably determined due to the unavailability of
funds in or other circumstances affecting the London interbank market
or (ii) any Participant shall advise Agent that the LIBOR Rental Rate
for such Rental Period does not adequately and fairly reflect the
cost to such Participant of funding its portion of the Outstanding
Lease Amount under the applicable Facility, Agent shall immediately
give notice of such condition to Lessee, Lessor and the other
Participants. After the giving of any such notice (and until Agent
shall otherwise notify Lessee and Lessor that the circumstances
giving rise to such condition no longer exist), the LIBOR Rental Rate
shall be unavailable and the Rental Rate for each Rental Period shall
be the Alternate Rental Rate.
(b) Illegality. If, after the date of this Agreement, the
adoption of any Governmental Rule, any change in any Governmental
Rule or the application or requirements thereof (whether such change
occurs in accordance with the terms of such Governmental Rule as
enacted, as a result of amendment or otherwise), any change in the
interpretation or administration of any Governmental Rule by any
Governmental Authority, or compliance by Lessor or any Participant
with any request or directive (whether or not having the force of
law) of any Governmental Authority (a "Change of Law") shall make it
unlawful or impossible for any Participant to fund or maintain its
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portion of the Outstanding Lease Amount under either Facility at the
LIBOR Rental Rate, such Participant shall immediately notify Agent
and Agent shall immediately notify Lessee, Lessor and the other
Participants of such Change of Law. After the giving of any such
notice (and until Agent shall otherwise notify Lessee and Lessor that
such Change of Law is no longer in effect), the LIBOR Rental Rate
shall be unavailable and the Rental Rate under both Facilities for
each Rental Period shall be the Alternate Rental Rate.
(c) Increased Costs. If, after the date of this Agreement,
any Change of Law:
(i) Shall subject Lessor or any Participant to any tax,
duty or other charge with respect to the Outstanding Lease
Amount under either Facility, or shall change the basis of
taxation of Base Rent payments by Lessee to Lessor or any
Participant under this Agreement or any other Operative
Document (except for changes in the rate of taxation on the
overall net income of Lessor or any Participant imposed by
its jurisdiction of incorporation, the jurisdiction in which
its principal executive office is located or, in the case of
any Participant, the jurisdiction in which its Applicable
Participating Office is located); or
(ii) Shall impose, modify or hold applicable any
reserve (excluding any Reserve Requirement or other reserve
to the extent included in the calculation of the LIBOR
Rental Rate), special deposit or similar requirement against
assets held by, deposits or other liabilities in or for the
account of, advances or loans by, or any other acquisition
of funds by Lessor or any Participant for its portion of the
Outstanding Lease Amount under either Facility; or
(iii) Shall impose on Lessor or any Participant any
other condition related to the Outstanding Lease Amount
under either Facility, Base Rent under either Facility or
Lessor's or such Participant's commitments hereunder;
And the effect of any of the foregoing is to increase the cost to
Lessor or such Participant of funding or maintaining its portion of
the Outstanding Lease Amount under either Facility or commitments or
to reduce any amount receivable by Lessor or such Participant
hereunder; then Lessee shall from time to time within five (5)
Business Days after demand by Lessor or such Participant, pay to
Lessor or such Participant additional amounts sufficient to reimburse
Lessor or such Participant for such increased costs or to compensate
Lessor or such Participant for such reduced amounts. A certificate as
to the amount of such increased costs or reduced amounts, submitted
by Lessor or such Participant to Lessee shall, in the absence of
manifest error, be conclusive and binding on Lessee for all purposes.
The obligations of Lessee under this Subparagraph 2.12(c) shall
survive the payment and performance of the Lessee Obligations and the
termination of this Agreement.
(d) Capital Requirements. If, after the date of this
Agreement, Lessor or any Participant determines that (i) any Change
of Law affects the amount of capital required or expected to be
maintained by such Person or any other Person controlling such Person
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(a "Capital Adequacy Requirement") and (ii) the amount of capital
maintained by such Person or such other Person which is attributable
to or based upon the Advances, the commitments or this Agreement must
be increased as a result of such Capital Adequacy Requirement (taking
into account such Person's or such other Person's policies with
respect to capital adequacy), Lessee shall pay to such Person or such
other Person, within five (5) Business Days after demand of such
Person, such amounts as such Person or such other Person shall
determine are necessary to compensate such Person or such other
Person for the increased costs to such Person or such other Person of
such increased capital. A certificate of Lessor or any Participant
setting forth in reasonable detail the computation of any such
increased costs, delivered by such Person to Lessee shall, in the
absence of manifest error, be conclusive and binding on Lessee for
all purposes. The obligations of Lessee under this Subparagraph
2.12(d) shall survive the payment and performance of the Lessee
Obligations and the termination of this Agreement.
(e) Mitigation. If Lessor or any Participant becomes aware
of (i) any Change of Law which will make it unlawful or impossible
for such Person to fund or maintain its portion of the Outstanding
Lease Amount under either Facility at the LIBOR Rental Rate or (ii)
any Change of Law or other event or condition which will obligate
Lessee to pay any amount pursuant to Subparagraph 2.12(c) or
Subparagraph 2.12(d), such Person shall notify Lessee and Agent
thereof as promptly as practical. If any Person has given notice of
any such Change of Law or other event or condition and thereafter
becomes aware that such Change of Law or other event or condition has
ceased to exist, such Person shall notify Lessee and Agent thereof as
promptly as practical. Each Person affected by any Change of Law
which makes it unlawful or impossible for such Person to fund or
maintain its portion of the Outstanding Lease Amount under either
Facility at the LIBOR Rental Rate or to which Lessee is obligated to
pay any amount pursuant to Subparagraph 2.12(c) or Subparagraph
2.12(d) shall use reasonable commercial efforts (including changing
the jurisdiction of its Applicable Participating Office) to avoid the
effect of such Change of Law or to avoid or materially reduce any
amounts which Lessee is obligated to pay pursuant to Subparagraph
2.12(c) or Subparagraph 2.12(d) if, in the reasonable opinion of such
Person, such efforts would not be disadvantageous to such Person or
contrary to such Person's normal banking practices.
2.13. Taxes on Payments.
(a) Payments Free of Taxes. All payments made by Lessee
under this Agreement and the other Operative Documents shall be made
free and clear of, and without deduction or withholding for or on
account of, any present or future Indemnified Taxes, now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental
Authority. If any Indemnified Taxes are required to be withheld from
any amounts payable to any Lessor Party hereunder or under the other
Operative Documents, the amounts so payable to such Lessor Party
shall be increased to the extent necessary to yield to such Lessor
Party (after payment of all Indemnified Taxes) the Base Rent or any
such other amounts payable hereunder at the rates or in the amounts
specified in this Agreement and the other Operative Documents.
Whenever any Indemnified Taxes are
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payable by Lessee, as promptly as possible thereafter, Lessee shall
send to Agent for its own account or for the account of Lessor or
such Participant, as the case may be, a certified copy of an original
official receipt received by Lessee showing payment thereof. If
Lessee fails to pay any Indemnified Taxes when due to the appropriate
taxing authority or fails to remit to Agent the required receipts or
other required documentary evidence, Lessee shall indemnify the
Lessor Parties for any incremental taxes, interest or penalties that
may become payable by the Lessor Parties as a result of any such
failure. The obligations of Lessee under this Subparagraph 2.13(a)
shall survive the payment and performance of the Lessee Obligations
and the termination of this Agreement.
(b) Withholding Exemption Certificates. On or prior to the
Closing Date or, if such date does not occur within thirty (30) days
after the date of this Agreement, by the end of such 30-day period,
Lessor, if it is not incorporated under the laws of the United States
of America or a state thereof, and each Participant which is not
incorporated under the laws of the United States of America or a
state thereof shall deliver to Lessee and Agent two duly completed
copies of United States Internal Revenue Service Form 1001 or 4224
(or successor applicable form), as the case may be, certifying in
each case that Lessor or such Participant, as the case may be, is
entitled to receive payments under this Agreement and the other
Operative Documents without deduction or withholding of any United
States federal income taxes. Each Person which delivers to Lessee and
Agent a Form 1001 or 4224 pursuant to the immediately preceding
sentence further undertakes to deliver to Lessee and Agent two
further copies of Form 1001 or 4224 (or successor applicable forms),
or other manner of certification or procedure, as the case may be, on
or before the date that any such form expires or becomes obsolete or
after the occurrence of any event requiring a change in the most
recent form previously delivered by it to Lessee and Agent, and such
extensions or renewals thereof as may reasonably be requested by
Lessee or Agent, certifying in the case of a Form 1001 or 4224 that
such Person is entitled to receive payments under this Agreement and
the other Operative Documents without deduction or withholding of any
United States federal income taxes, unless in any such cases an event
(including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery
would otherwise be required which renders all such forms inapplicable
or which would prevent Lessor or a Participant from duly completing
and delivering any such form with respect to it and Lessor or such
Participant advises Lessee and Agent that it is not capable of
receiving payments without any deduction or withholding of United
States federal income tax.
(c) Mitigation. If any Lessor Party claims any additional
amounts to be payable to it pursuant to this Paragraph 2.13, such
Lessor Party shall use reasonable commercial efforts to file any
certificate or document requested in writing by Lessee (including
copies of Internal Revenue Service Form 1001 (or successor forms)
reflecting a reduced rate of withholding) or to change the
jurisdiction of its Applicable Participating Office if the making of
such a filing or such change in the jurisdiction of its Applicable
Participating Office would avoid the need for or materially reduce
the amount of any such additional amounts which may thereafter accrue
and if, in the reasonable opinion of a Participant, in the case of a
change in the jurisdiction of its Applicable Participating
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Office, such change would not be disadvantageous to such Person or
contrary to such Person's normal banking practices.
(d) Tax Returns. Nothing contained in this Paragraph 2.13
shall require any Lessor Party to make available any of its tax
returns (or any other information relating to its taxes which it
deems to be confidential).
2.14. Funding Loss Indemnification. If Lessee shall (a) pay any
portion of the Outstanding Lease Amount under either Facility on any day other
than the last day of a Rental Period (whether an optional payment, a mandatory
payment or otherwise) or (b) cancel or otherwise fail to consummate any Advance
Request which has been delivered to Agent (whether as a result of the failure to
satisfy any applicable conditions or otherwise), Lessee shall, upon demand by
Lessor or any Participant, reimburse such Person for and hold such Person
harmless from all costs and losses incurred by such Person as a result of such
payment, cancellation or failure. Lessee understands that such costs and losses
may include, without limitation, losses incurred by Lessor or a Participant as a
result of funding and other contracts entered into by such Person to fund its
portion of the Outstanding Lease Amount under the applicable Facility. Each
Person demanding payment under this Paragraph 2.14 shall deliver to Lessee, with
a copy to Agent, a certificate setting forth the amount of costs and losses for
which demand is made, which certificate shall set forth in reasonable detail the
calculation of the amount demanded. Such a certificate so delivered to Lessee
shall constitute prima facie evidence of such costs and losses. The obligations
of Lessee under this Paragraph 2.14 shall survive the payment and performance of
the Lessee Obligations and the termination of this Agreement.
2.15. Replacement of Participants. If any Participant shall (a)
become a Defaulting Participant more than two (2) times in a period of twelve
(12) consecutive months, (b) continue as a Defaulting Participant for more than
five (5) Business Days at any time, (c) deliver, pursuant to Subparagraph
2.12(b), a notice of a Change of Law which does not affect Required
Participants, or (d) demand any payment under Subparagraph 2.12(c), 2.12(d) or
2.13(a) for a reason which is not applicable to Required Participants, then
Agent may (or upon the written request of Lessee if no Event of Default has
occurred and is continuing, shall) replace such Participant (the "affected
Participant"), or cause such affected Participant to be replaced, with another
Person (the "replacement Participant") satisfying the requirements of an
Eligible Assignee under Subparagraph 7.05(b), by having the affected Participant
sell and assign all of its rights and obligations under this Agreement and the
other Operative Documents to the replacement Participant pursuant to
Subparagraph 7.05(b); provided, however, that if Lessee seeks to exercise such
right, it must do so within sixty (60) days after it first knows or should have
known of the occurrence of the event or events giving rise to such right, and no
Lessor Party shall have any obligation to identify or locate a replacement
Participant for Lessee. Upon receipt by any affected Participant of a written
notice from Agent stating that Agent is exercising the replacement right set
forth in this Paragraph 2.15, such affected Participant shall sell and assign
all of its rights and obligations under this Agreement and the other Operative
Documents to the replacement Participant pursuant to an Assignment Agreement and
Subparagraph 7.05(b) for a purchase price equal to the sum of its portion of the
Outstanding Lease Amount, the accrued
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and unpaid portion of the Base Rent relating to such portion and its ratable
share of all fees to which it is entitled.
SECTION 3. CONDITIONS PRECEDENT
3.01. Acquisition Advances. The obligation of Lessor to make the
Acquisition Advances (and the obligations of the Participants to fund their
respective Proportionate Shares of the Acquisition Advances) on the Closing Date
is (are) subject to receipt by Agent, on or prior to the Closing Date, of each
item listed in Schedule 3.01, each in form and substance satisfactory to Lessor,
Agent and each Participant, and with sufficient copies for, Lessor, Agent and
each Participant.
3.02. Improvement/Expense Advances. The obligation of Lessor to make
each Improvement/Expense Advance for each Tract of Property (and the obligations
of the Participants to fund their respective Proportionate Shares of such
Advance) is (are) subject to (a) satisfaction of the conditions set forth in
Paragraph 3.01; (b) receipt by Agent pursuant to Paragraph 2.03 of the Advance
Request for such Advance, appropriately completed and duly executed by Lessee;
and (c) receipt by Agent of date-down endorsements to Agent's and Lessor's title
insurance policies covering such Tract or binders acceptable to Agent and
Lessor.
3.03. Other Conditions Precedent. The occurrence of each Credit Event
(including the making of each Advance by Lessor and the funding of each Advance
by the Participants) is subject to the further conditions that, on the date such
Credit Event is to occur and after giving effect to such Credit Event, the
following shall be true and correct:
(a) The representations and warranties of Lessee set forth
in Paragraph 4.01 and in the other Operative Documents are true and
correct in all material respects as if made on such date (except for
representations and warranties expressly made as of a specified date,
which shall be true as of such date);
(b) No Default has occurred and is continuing or will
result from such Credit Event; and
(c) All of the Operative Documents are in full force and
effect.
The submission by Lessee to Lessor and Agent of each Advance Request, each
Notice of Rental Period Selection and a Notice of Marketing Option Exercise
shall be deemed to be a representation and warranty by Lessee that each of the
statements set forth above in this Paragraph 3.03 is true and correct as of the
date of such request and notice.
3.04. Covenant to Deliver. Lessee agrees (not as a condition but as a
covenant) to deliver to Lessor and Agent each item required to be delivered to
Lessor and Agent as a condition to each Advance if such Advance is made. Lessee
expressly agrees that the making of any Advance prior to the receipt by Lessor
and Agent of any such item shall not constitute a
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waiver by Lessor, Agent or any Participant of Lessee's obligation to deliver
such item, unless expressly waived in writing.
SECTION 4. REPRESENTATIONS AND WARRANTIES
4.01. Lessee's Representations and Warranties. In order to induce the
Lessor Parties to enter into this Agreement and the other Operative Documents to
which they are parties, Lessee hereby represents and warranties to the Lessor
Parties as follows:
(a) Due Incorporation, Qualification, etc. Each of Lessee
and Lessee's Subsidiaries (i) is a corporation duly organized,
validly existing and in good standing under the laws of its state of
incorporation; (ii) has the power and authority to own, lease and
operate its properties and carry on its business as now conducted;
and (iii) is duly qualified, licensed to do business and in good
standing as a foreign corporation in each jurisdiction where the
failure to be so qualified or licensed is reasonably likely to have a
Material Adverse Effect.
(b) Authority. The execution, delivery and performance by
Lessee of each Operative Document executed, or to be executed, by
Lessee and the consummation of the transactions contemplated thereby
(i) are within the power of Lessee and (ii) have been duly authorized
by all necessary actions on the part of Lessee.
(c) Enforceability. Each Operative Document executed, or to
be executed, by Lessee has been, or will be, duly executed and
delivered by Lessee and constitutes, or will constitute, a legal,
valid and binding obligation of Lessee, enforceable against Lessee in
accordance with its terms, except as limited by bankruptcy,
insolvency or other laws of general application relating to or
affecting the enforcement of creditors' rights generally and general
principles of equity.
(d) Non-Contravention. The execution and delivery by Lessee
of the Operative Documents executed by Lessee and the performance and
consummation of the transactions contemplated thereby do not (i)
violate any Requirement of Law applicable to Lessee; (ii) violate any
provision of, or result in the breach or the acceleration of, or
entitle any other Person to accelerate (whether after the giving of
notice or lapse of time or both), any Contractual Obligation of
Lessee; or (iii) result in the creation or imposition of any Lien (or
the obligation to create or impose any Lien) upon any property, asset
or revenue of Lessee (except such Liens as may be created in favor of
Lessor or Agent pursuant to this Agreement or the other Operative
Documents).
(e) Approvals. No consent, approval, order or authorization
of, or registration, declaration or filing with, any Governmental
Authority or other Person (including, without limitation, the
shareholders of any Person) is required in connection with the
execution and delivery of the Operative Documents executed by Lessee
and the performance and consummation by Lessee of the transactions
contemplated thereby, except such as have been made or obtained and
are in full force and effect.
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(f) No Violation or Default. Neither Lessee nor any of its
Subsidiaries is in violation of or in default with respect to (i) any
Requirement of Law applicable to such Person; (ii) any Contractual
Obligation of such Person (nor is there any waiver in effect which,
if not in effect, would result in such a violation or default),
where, in each case, such violation or default is reasonably likely
to have a Material Adverse Effect. Without limiting the generality of
the foregoing, neither Lessee nor any of its Subsidiaries (A) has
violated any Environmental Laws, (B) has any liability under any
Environmental Laws or (C) has received notice or other communication
of an investigation or is under investigation by any Governmental
Authority having authority to enforce Environmental Laws, where such
violation, liability or investigation is reasonably likely to have a
Material Adverse Effect. No Default has occurred and is continuing.
(g) Litigation. Except as set forth in Schedule 4.01(g), no
actions (including, without limitation, derivative actions), suits,
proceedings or investigations are pending or, to the knowledge of
Lessee, threatened against Lessee or any of its Subsidiaries at law
or in equity in any court or before any other Governmental Authority
which (i) is reasonably likely (alone or in the aggregate) to have a
Material Adverse Effect or (ii) seeks to enjoin, either directly or
indirectly, the execution, delivery or performance by Lessee of the
Operative Documents or the transactions contemplated thereby. The
representations and warranties set forth in Schedule 4.01(g) are true
and correct.
(h) Title; Possession Under Leases. Except as set forth in
Schedule 4.01(g), Lessee and its Subsidiaries own and have good and
marketable title, or a valid leasehold interest in, all their
respective properties and assets as reflected in the most recent
Financial Statements delivered to Agent (except those assets and
properties disposed of in the ordinary course of business or
otherwise in compliance with this Agreement since the date of such
Financial Statements) and all respective assets and properties
acquired by Lessee and its Subsidiaries since such date (except those
disposed of in the ordinary course of business or otherwise in
compliance with this Agreement), except in any case where the failure
so to own or to have such title is not reasonably likely to have a
Material Adverse Effect. Such assets and properties are subject to no
Lien, except for Permitted Liens. Each of Lessee and its Subsidiaries
has complied with all material obligations under all material leases
to which it is a party and all such leases are in full force and
effect. Each of Lessee and its Subsidiaries enjoys peaceful and
undisturbed possession under such leases.
(i) Financial Statements. The Financial Statements of
Lessee and its Subsidiaries which have been delivered to Agent, (i)
are in accordance with the books and records of Lessee and its
Subsidiaries, which have been maintained in accordance with good
business practice; (ii) have been prepared in conformity with GAAP;
and (iii) fairly present the financial conditions and results of
operations of Lessee and its Subsidiaries as of the date thereof and
for the period covered thereby. Neither Lessee nor any of its
Subsidiaries has any Contingent Obligations, liability for taxes or
other outstanding obligations which are material in the aggregate,
except as disclosed in the audited
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Financial Statements dated December 31, 1996, furnished by Lessee to
Agent prior to the date hereof, or in the Financial Statements
delivered to Agent pursuant to clause (i) or (ii) of Subparagraph
5.01(a).
(j) Equity Securities. All outstanding Equity Securities of
Lessee are duly authorized, validly issued, fully paid and
non-assessable. All Equity Securities of Lessee have been offered and
sold in compliance with all federal and state securities laws and all
other Requirements of Law.
(k) No Agreements to Sell Assets; Etc. Neither Lessee nor
any of its Subsidiaries has any legal obligation, absolute or
contingent, to any Person to sell the assets of Lessee or any of its
Subsidiaries (other than sales in the ordinary course of business),
or to effect any merger, consolidation or other reorganization of
Lessee or any of its Subsidiaries or to enter into any agreement with
respect thereto, except for sales permitted by Subparagraph 5.02(c).
(l) Employee Benefit Plans.
(i) Based on the latest valuation of each
Employee Benefit Plan that either Lessee or any ERISA
Affiliate maintains or contributes to, or has any
obligation under (which occurred within twelve months of
the date of this representation), the aggregate benefit
liabilities of such plan within the meaning of Section 4001
of ERISA did not exceed the aggregate value of the assets
of such plan. Neither Lessee nor any ERISA Affiliate has
any liability with respect to any post-retirement benefit
under any Employee Benefit Plan which is a welfare plan (as
defined in section 3(1) of ERISA), other than liability for
health plan continuation coverage described in Part 6 of
Title I(B) of ERISA, which liability for health plan
contribution coverage is not reasonably likely to have a
Material Adverse Effect.
(ii) Each Employee Benefit Plan complies, in both
form and operation, in all material respects, with its
terms, ERISA and the IRC, and no condition exists or event
has occurred with respect to any such plan which would
result in the incurrence by either Lessee or any ERISA
Affiliate of any material liability, fine or penalty. Each
Employee Benefit Plan, related trust agreement, arrangement
and commitment of Lessee or any ERISA Affiliate is legally
valid and binding and in full force and effect. No Employee
Benefit Plan is being audited or investigated by any
government agency or is subject to any pending or
threatened claim or suit. Neither Lessee nor any ERISA
Affiliate nor any fiduciary of any Employee Benefit Plan
has engaged in a prohibited transaction under section 406
of ERISA or section 4975 of the IRC.
(iii) Neither Lessee nor any ERISA Affiliate
contributes to or has any material contingent obligations
to any Multiemployer Plan. Neither Lessee nor any ERISA
Affiliate has incurred any material liability (including
secondary
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liability) to any Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer
Plan under Section 4201 of ERISA or as a result of a sale
of assets described in Section 4204 of ERISA. Neither
Lessee nor any ERISA Affiliate has been notified that any
Multiemployer Plan is in reorganization or insolvent under
and within the meaning of Section 4241 or Section 4245 of
ERISA or that any Multiemployer Plan intends to terminate
or has been terminated under Section 4041A of ERISA.
(m) Other Regulations. Lessee is not subject to regulation
under the Investment Company Act of 1940, the Public Utility Holding
Company Act of 1935, the Federal Power Act, the Interstate Commerce
Act, any state public utilities code or to any other Governmental
Rule limiting its ability to incur indebtedness.
(n) Patent and Other Rights. Except as set forth in
Schedule 4.01(g), Lessee and its Subsidiaries own, license or
otherwise have the right to use, under validly existing agreements,
all patents, licenses, trademarks, trade names, trade secrets,
service marks, copyrights and all rights with respect thereto, which
are required to conduct their businesses as now conducted.
(o) Governmental Charges. Lessee and its Subsidiaries have
filed or caused to be filed all tax returns which are required to be
filed by them. Lessee and its Subsidiaries have paid, or made
provision for the payment of, all taxes and other Governmental
Charges which have or may have become due pursuant to said returns or
otherwise and all other indebtedness, except such Governmental
Charges or indebtedness, if any, which are being contested in good
faith and as to which adequate reserves (determined in accordance
with GAAP) have been provided or which are not reasonably likely to
have a Material Adverse Effect if unpaid.
(p) Margin Stock. Lessee owns no Margin Stock which, in the
aggregate, would constitute a substantial part of the assets of
Lessee, and no proceeds of any Loan will be used to purchase or
carry, directly or indirectly, any Margin Stock or to extend credit,
directly or indirectly, to any Person for the purpose of purchasing
or carrying any Margin Stock.
(q) Subsidiaries, etc. Set forth in Schedule 4.01(q) (as
supplemented by Lessee from time to time in a written notice to
Agent) is a complete list of all of Lessee's Subsidiaries, the
jurisdiction of incorporation of each, the classes of Equity
Securities of each and the number of shares and percentages of shares
of each such class owned directly or indirectly by Lessee. Except for
such Subsidiaries, Lessee has no Subsidiaries, is not a partner in
any partnership or a joint venturer in any joint venture.
(r) Catastrophic Events. Neither Lessee nor any of its
Subsidiaries and none of their properties is or has been affected by
any fire, explosion, accident, strike, lockout or other labor
dispute, drought, storm, hail, earthquake, embargo, act of God or
other casualty that is reasonably likely to have a Material Adverse
Effect. There are no
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disputes presently subject to grievance procedure, arbitration or
litigation under any of the collective bargaining agreements,
employment contracts or employee welfare or incentive plans to which
Lessee or any of its Subsidiaries is a party, and there are no
strikes, lockouts, work stoppages or slowdowns, or, to the best
knowledge of Lessee, jurisdictional disputes or organizing activities
occurring or threatened which alone or in the aggregate are
reasonably likely to have a Material Adverse Effect.
(s) No Material Adverse Effect. No event has occurred and
is continuing and no condition exists which is reasonably likely to
have a Material Adverse Effect.
(t) The Property. The representations and warranties
relating to each Tract set forth in Parts 1 and 2 of Schedule 4.01(t)
are true and correct. The following representations and warranties
apply to all of the Property:
(i) All of the Property complies and will comply
at all times (whether before commencement of any
construction, during any construction or after completion
of construction of any New Improvements) with all
applicable Governmental Rules (including Title III of the
Americans with Disabilities Act; Environmental Laws; and
zoning, land use, building, planning and fire laws, rules,
regulations and codes) and Insurance Requirements, except
for violations which are not reasonably likely to have a
Material Adverse Effect. None of the Property is or has
been a site for the use, generation, manufacture, storage,
treatment, release, discharge, disposal or transportation
of any Hazardous Materials, and no Hazardous Materials
(except as set forth in Schedule 1 to each Lease Agreement)
are located on any of the Property. There are no claims or
actions pending or, to Lessee's knowledge, threatened
against any of the Property by any Governmental Authority
or any other Person relating to Hazardous Materials or
pursuant to any Environmental Laws.
(ii) None of the Improvements (whether before
commencement of any construction, during any construction
or after completion of construction of any New
Improvements) encroach or will at any time encroach in any
manner onto any adjoining land, except as permitted by
express written and recorded encroachment agreements
approved by Agent or as affirmatively insured against by
appropriate title insurance.
(iii) All licenses, approvals, authorizations,
consents, permits, easements and rights-of-way required for
the use of any of the Property have been obtained or, if
not yet required, will be obtained before required.
(iv) After the purchase of each Tract of Property
on the Acquisition Date therefor, Lessor will have good and
valid fee simple title to such Property, subject to no
Liens except for Permitted Property Liens.
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(u) Chief Place of Business. Lessee's chief place of
business is located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇.
(v) Accuracy of Information Furnished. None of the
Operative Documents and none of the other certificates, statements or
information furnished to Lessor, Agent or any Participant by or on
behalf of Lessee or any of its Subsidiaries in connection with the
Operative Documents or the transactions contemplated thereby contains
or will contain any untrue statement of a material fact or omits or
will omit to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made,
not misleading.
Lessee shall be deemed to have reaffirmed, for the benefit of the Lessor
Parties, each representation and warranty contained in this Paragraph 4.01 on
and as of the date of each Credit Event (except for representations and
warranties expressly made as of a specified date, which shall be true as of such
date).
4.02. Lessor's Representations and Warranties. In order to induce
Lessee, Agent and the Participants to enter into this Agreement and the other
Operative Documents to which they are parties, Lessor hereby represents and
warranties to Lessee, Agent and the Participants as follows:
(a) Due Incorporation, Qualification, etc. Lessor (i) is a
corporation duly organized, validly existing and in good standing
under the laws of its state of incorporation and (ii) has the power
and authority to own, lease and operate its properties and carry on
its business as now conducted.
(b) Authority. The execution, delivery and performance by
Lessor of each Operative Document executed, or to be executed, by
Lessor and the consummation of the transactions contemplated thereby
(i) are within the power of Lessor and (ii) have been duly authorized
by all necessary actions on the part of Lessor.
(c) Enforceability. Each Operative Document executed, or to
be executed, by Lessor has been, or will be, duly executed and
delivered by Lessor and constitutes, or will constitute, a legal,
valid and binding obligation of Lessor, enforceable against Lessor in
accordance with its terms, except as limited by bankruptcy,
insolvency or other laws of general application relating to or
affecting the enforcement of creditors' rights generally and general
principles of equity.
(d) Non-Contravention. The execution and delivery by Lessor
of the Operative Documents executed by Lessor and the performance and
consummation of the transactions contemplated thereby do not (i)
violate any Requirement of Law applicable to Lessor; (ii) violate any
provision of, or result in the breach or the acceleration of, or
entitle any other Person to accelerate (whether after the giving of
notice or lapse of time or both), any Contractual Obligation of
Lessor; or (iii) result in the creation or imposition of any Lien (or
the obligation to create or impose any Lien) upon any property, asset
or
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revenue of Lessor (except such Liens as may be created in favor of
Agent pursuant to this Agreement or the other Operative Documents).
(e) Approvals. No consent, approval, order or authorization
of, or registration, declaration or filing with, any Governmental
Authority or other Person (including, without limitation, the
shareholders of any Person) is required in connection with the
execution and delivery of the Operative Documents executed by Lessor
and the performance and consummation of the transactions contemplated
thereby, except such as have been made or obtained and are in full
force and effect.
(f) Litigation. No actions (including, without limitation,
derivative actions), suits, proceedings or investigations are pending
or, to the knowledge of Lessor, threatened against Lessor at law or
in equity in any court or before any other Governmental Authority
which (i) is reasonably likely (alone or in the aggregate) to
materially and adversely affect the ability of Lessor to perform its
obligations under the Operative Documents to which it is a party or
(ii) seeks to enjoin, either directly or indirectly, the execution,
delivery or performance by Lessor of the Operative Documents or the
transactions contemplated thereby.
(g) Other Regulations. Lessor is not subject to regulation
under the Investment Company Act of 1940, the Public Utility Holding
Company Act of 1935, the Federal Power Act, the Interstate Commerce
Act, any state public utilities code or to any other Governmental
Rule limiting its ability to incur indebtedness.
(h) Chief Place of Business. Lessor's chief place of
business is located at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇.
4.03. Participants' Representations and Warranties. In order to
induce Lessee, Lessor and Agent to enter into this Agreement and the other
Operative Documents to which they are parties, each Participant hereby
represents and warranties to Lessee, Lessor and Agent as follows:
(a) Due Incorporation, Qualification, etc. Such Participant
(i) is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation and (ii)
has the power and authority to own, lease and operate its properties
and carry on its business as now conducted.
(b) Authority. The execution, delivery and performance by
such Participant of each Operative Document executed, or to be
executed, by such Participant and the consummation of the
transactions contemplated thereby (i) are within the power of such
Participant and (ii) have been duly authorized by all necessary
actions on the part of such Participant.
(c) Enforceability. Each Operative Document executed, or to
be executed, by such Participant has been, or will be, duly executed
and delivered by such Participant and
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constitutes, or will constitute, a legal, valid and binding
obligation of such Participant, enforceable against such Participant
in accordance with its terms, except as limited by bankruptcy,
insolvency or other laws of general application relating to or
affecting the enforcement of creditors' rights generally and general
principles of equity.
(d) Non-Contravention. The execution and delivery by such
Participant of the Operative Documents executed by such Participant
and the performance and consummation of the transactions contemplated
thereby do not (i) violate any Requirement of Law applicable to such
Participant; (ii) violate any provision of, or result in the breach
or the acceleration of, or entitle any other Person to accelerate
(whether after the giving of notice or lapse of time or both), any
Contractual Obligation of such Participant; or (iii) result in the
creation or imposition of any Lien (or the obligation to create or
impose any Lien) upon any property, asset or revenue of such
Participant (except such Liens as may be created in favor of Lessor
or Agent pursuant to this Agreement or the other Operative
Documents).
(e) Approvals. No consent, approval, order or authorization
of, or registration, declaration or filing with, any Governmental
Authority or other Person (including, without limitation, the
shareholders of any Person) is required in connection with the
execution and delivery of the Operative Documents executed by such
Participant and the performance and consummation of the transactions
contemplated thereby, except such as have been made or obtained and
are in full force and effect.
(f) Litigation. No actions (including, without limitation,
derivative actions), suits, proceedings or investigations are pending
or, to the knowledge of such Participant, threatened against such
Participant at law or in equity in any court or before any other
Governmental Authority which (i) is reasonably likely (alone or in
the aggregate) to materially and adversely affect the ability of such
Participant to perform its obligations under the Operative Documents
to which it is a party or (ii) seeks to enjoin, either directly or
indirectly, the execution, delivery or performance by such
Participant of the Operative Documents or the transactions
contemplated thereby.
(g) Own Account. Such Participant is acquiring its
participation interest hereunder for its own account for investment
and not with a view to any distribution (as such term is used in
Section 2(11) of the Securities Act of 1933) thereof, and, if in the
future it should decide to dispose of its participation interest, it
understands that it may do so only in compliance with the Securities
Act of 1933 and the rules and regulations of the Securities and
Exchange Commission thereunder and any applicable state securities
laws.
SECTION 5. COVENANTS
5.01. Lessee's Affirmative Covenants. Until the termination of this
Agreement and the satisfaction in full by Lessee of all Lessee Obligations,
Lessee will comply, and will cause compliance, with the following affirmative
covenants, unless Lessor and Required Participants shall otherwise consent in
writing:
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35
(a) Financial Statements, Reports, etc. Lessee shall
furnish to Agent, with sufficient copies for Lessor and each
Participant, the following, each in such form and such detail as
Agent, Lessor or the Required Participants shall reasonably request:
(i) As soon as available and in no event later
than fifty (50) days after the last day of each fiscal
quarter of Lessee (other than the last quarter in any
fiscal year), a copy of the Financial Statements of Lessee
and its Subsidiaries (prepared on a consolidated basis) for
such quarter and for the fiscal year to date, certified by
the president or chief financial officer of Lessee to
present fairly the financial condition, results of
operations and other information reflected therein and to
have been prepared in accordance with GAAP (subject to
normal year-end audit adjustments);
(ii) As soon as available and in no event later
than one hundred (100) days after the close of each fiscal
year of Lessee, (A) copies of the audited Financial
Statements of Lessee and its Subsidiaries (prepared on a
consolidated basis) for such year, prepared by Ernst &
Young or by other independent certified public accountants
of recognized national standing acceptable to Agent, (B)
copies of the unqualified opinions (or qualified opinions
reasonably acceptable to Required Participants) and
management letters delivered by such accountants in
connection with all such Financial Statements and (C)
certificates of such accountants to Agent stating that in
making the examination necessary for their opinion they
have reviewed this Agreement and have obtained no knowledge
of any Default which has occurred and is continuing, or if,
in the opinion of such accountants, a Default has occurred
and is continuing, a statement as to the nature thereof;
(iii) Contemporaneously with the quarterly and
year-end Financial Statements required by the foregoing
clauses (i) and (ii), a compliance certificate of the
president or chief financial officer of Lessee which (A)
states that no Default has occurred and is continuing, or,
if any such Default has occurred and is continuing, a
statement as to the nature thereof and what action Lessee
proposes to take with respect thereto and (B) sets forth,
for the quarter or year covered by such Financial
Statements or as of the last day of such quarter or year
(as the case may be), the calculation of the financial
ratios and tests provided in Paragraph 5.03;
(iv) As soon as available and in no event later
than fifty (50) days after the last day of each fiscal
quarter of Lessee, a certificate of the chief financial
officer of Lessee which sets forth the calculation of the
annualized Funded Indebtedness/EBITDA Ratio for the
consecutive two-quarter period ending on such day;
(v) As soon as possible and in no event later
than five (5) Business Days after any Senior Officer of
Lessee knows of the occurrence or existence of
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36
(A) any Reportable Event under any Employee Benefit Plan
or Multiemployer Plan; (B) any actual or threatened
litigation, suits, claims or disputes against Lessee or
any of its Subsidiaries involving potential monetary
damages payable by Lessee or its Subsidiaries of
$2,500,000 or more (alone or in the aggregate); (C) any
other event or condition which is reasonably likely to
have a Material Adverse Effect; or (D) any Default; the
statement of the president or chief financial officer of
Lessee setting forth details of such event, condition or
Default and the action which Lessee proposes to take with
respect thereto;
(vi) As soon as available and in no event later
than five (5) Business Days after they are sent, made
available or filed, copies of (A) all registration
statements and reports filed by Lessee or any of its
Subsidiaries with any securities exchange or the Securities
and Exchange Commission (including, without limitation, all
10-Q, 10-K and 8-Q reports); (B) all reports, proxy
statements and financial statements sent or made available
by Lessee or any of its Subsidiaries to its security
holders; and (C) all press releases and other similar
public concerning any material developments in the business
of Lessee or any of its Subsidiaries made available by
Lessee or any of its Subsidiaries to the public generally;
(vii) As soon as available and in no event later
than five (5) Business Days after they are filed, copies of
all IRS Form 5500 reports for all Employee Benefit Plans
required to file such form;
(viii) As soon as available and in no event later
than ten (10) days before the first day of each fiscal year
of Lessee, the consolidated plan and forecast of Lessee and
its Subsidiaries for such fiscal year, including quarterly
cash flow projections and quarterly projections of Lessee's
compliance with each of the covenants set forth in
Paragraph 5.03;
(ix) As soon as possible and in no event later
than (A) ten (10) days prior to the acquisition by Lessee
or any of its Subsidiaries of any new Subsidiary or all or
substantially all of the assets of any other Person,
written notice thereof; and
(x) Such other instruments, agreements,
certificates, opinions, statements, documents and
information relating to the operations or condition
(financial or otherwise) of Lessee or its Subsidiaries, and
compliance by Lessee with the terms of this Agreement and
the other Operative Documents as Lessor or Agent may from
time to time reasonably request.
For the purposes of this Subparagraph 5.01(a), (1) the timely
delivery by Lessee to Agent pursuant to clause (vi) of a copy of the
Form 10-Q report filed by Lessee with the Securities and Exchange
Commission for any quarter shall satisfy the requirements of clause
(i) for such quarter and (2) the timely delivery by Lessee to Agent
pursuant to
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clause (vi) of a copy of the Form 10-K report filed by Lessee with
the Securities and Exchange Commission for any year shall satisfy the
requirements of clause (ii)(A) for such year, provided that such
reports are required to contain the same information as required by
clause (i) and clause (ii)(A), respectively.
(b) Books and Records. Lessee and its Subsidiaries shall at
all times keep proper books of record and account in which full, true
and correct entries will be made of their transactions in accordance
with GAAP.
(c) Inspections. Lessee and its Subsidiaries shall permit
any Person designated by any Participant, upon reasonable notice and
during normal business hours, to visit and inspect any of the
properties and offices of Lessee and its Subsidiaries, to examine the
books and records of Lessee and its Subsidiaries and make copies
thereof and to discuss the affairs, finances and business of Lessee
and its Subsidiaries with, and to be advised as to the same by, their
officers, auditors and accountants, all at such times and intervals
as any Participant may reasonably request.
(d) Insurance. In addition to the insurance requirements
set forth in the Lease Agreement with respect to the property, Lessee
and its Subsidiaries shall:
(i) Carry and maintain insurance of the types and
in the amounts customarily carried from time to time during
the term of this Agreement by others engaged in
substantially the same business as such Person and
operating in the same geographic area as such Person,
including, but not limited to, fire, public liability,
property damage and worker's compensation; and
(ii) Carry and maintain each policy for such
insurance with financially sound insurers.
(e) Governmental Charges and Other Indebtedness. Lessee and
its Subsidiaries shall promptly pay and discharge when due (i) all
taxes and other Governmental Charges prior to the date upon which
penalties accrue thereon, (ii) all indebtedness which, if unpaid,
could become a Lien upon the property of Lessee or its Subsidiaries
and (iii) subject to any subordination provisions applicable thereto,
all other Indebtedness which, if unpaid, is reasonably likely to have
a Material Adverse Effect, except such Indebtedness as may in good
faith be contested or disputed, or for which arrangements for
deferred payment have been made, provided that in each such case
appropriate reserves as required by GAAP are maintained.
(f) Use of Proceeds. Lessee shall not use any part of the
proceeds of any Advance, directly or indirectly, for the purpose of
purchasing or carrying any Margin Stock or for the purpose of
purchasing or carrying or trading in any securities under such
circumstances as to involve Lessee or any Lessor Party in a violation
of Regulations G, T, U or X issued by the Federal Reserve Board.
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(g) General Business Operations. Each of Lessee and its
Subsidiaries shall (i) preserve and maintain its corporate existence
and all of its rights, privileges and franchises reasonably necessary
to the conduct of its business, (ii) conduct its business activities
in compliance with all Requirements of Law and Contractual
Obligations applicable to such Person, the violation of which is
reasonably likely to have a Material Adverse Effect and (iii) keep
all property useful and necessary in its business in good working
order and condition, ordinary wear and tear excepted; provided,
however, that Lessee and its Subsidiaries may dissolve or liquidate
any Subsidiary if such Subsidiary is not a Material Subsidiary and
such dissolution or liquidation is not reasonably likely to have a
Material Adverse Effect. Lessee shall maintain its chief executive
office and principal place of business in the United States and shall
not relocate its chief executive office or principal place of
business outside of California except upon not less than thirty (30)
days prior written notice to Agent.
5.02. Lessee's Negative Covenants. Until the termination of this
Agreement and the satisfaction in full by Lessee of all Lessee Obligations,
Lessee will comply, and will cause compliance, with the following negative
covenants, unless Lessor and Required Participants shall otherwise consent in
writing:
(a) Indebtedness. Neither Lessee nor any of its
Subsidiaries shall create, incur, assume or permit to exist any
Indebtedness except for the following ("Permitted Indebtedness"):
(i) The Lessee Obligations under the Operative
Documents;
(ii) The Related Credit Obligations and Related
Lease Obligations;
(iii) Indebtedness of Lessee and its Subsidiaries
listed in Schedule 5.02(a) and existing on the date of this
Agreement;
(iv) Indebtedness of Lessee and its Subsidiaries
arising from the endorsement of instruments for collection
in the ordinary course of Lessee's or a Subsidiary's
business;
(v) Indebtedness of Lessee and its Subsidiaries
for trade accounts payable, provided that (A) such accounts
arise in the ordinary course of business and (B) no
material part of any such account is more than ninety (90)
days past due (unless subject to a bona fide dispute and
for which adequate reserves as required by GAAP have been
established);
(vi) Indebtedness of Lessee and its Subsidiaries
under Rate Contracts, provided that all such Rate Contracts
are entered into in connection with bona fide hedging
operations and not for speculation;
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(vii) Indebtedness of Lessee and its Subsidiaries
under purchase money loans and Capital Leases incurred by
Lessee or any of its Subsidiaries to finance the
acquisition by such Person of real property, fixtures or
equipment provided that in each case, (A) such Indebtedness
is incurred by such Person at the time of, or not later
than thirty (30) days after, the acquisition by such Person
of the property so financed, (B) such Indebtedness does not
exceed the purchase price of the property so financed, and
(C) no Default has occurred and is continuing at the time
such Indebtedness is incurred or will occur after giving
effect to such Indebtedness;
(viii) Indebtedness of Lessee and its
Subsidiaries under initial or successive refinancings of
any Indebtedness permitted by clause (iii) above, provided
that (A) the principal amount of any such refinancing does
not exceed the principal amount of the Indebtedness being
refinanced (except to the extent otherwise permitted by
clause (x) below) and (B) the material terms and provisions
of any such refinancing (including maturity, redemption,
prepayment, default and subordination provisions) are no
less favorable to the Participants than the Indebtedness
being refinanced;
(ix) Indebtedness of Lessee and its Subsidiaries
with respect to surety, appeal, indemnity, performance or
other similar bonds in the ordinary course of business; and
(x) Other Indebtedness of Lessee and its
Subsidiaries, provided that the aggregate principal amount
of all such other Indebtedness does not exceed $25,000,000
at any time.
(b) Liens. Neither Lessee nor any of its Subsidiaries shall
create, incur, assume or permit to exist any Lien on or with respect
to any of its assets or property of any character, whether now owned
or hereafter acquired, except for the following ("Permitted Liens"):
(i) Liens in favor of Lessor, Agent or any
Participant securing the Lessee Obligations;
(ii) Liens in favor of Agent or any Participant
securing the Related Credit Obligations or Related Lease
Obligations;
(iii) Liens listed in Schedule 5.02(b) and
existing on the date of this Agreement;
(iv) Liens for taxes or other Governmental
Charges not at the time delinquent or thereafter payable
without penalty or being contested in good faith, provided
that adequate reserves for the payment thereof as required
by GAAP have been established;
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(v) Liens of carriers, warehousemen, mechanics,
materialmen, vendors, and landlords and other similar Liens
imposed by law incurred in the ordinary course of business
for sums not overdue or being contested in good faith,
provided that adequate reserves for the payment thereof as
required by GAAP have been established;
(vi) Deposits under workers' compensation,
unemployment insurance and social security laws or to
secure the performance of bids, tenders, contracts (other
than for the repayment of borrowed money) or leases, or to
secure statutory obligations of surety or appeal bonds or
to secure indemnity, performance or other similar bonds in
the ordinary course of business;
(vii) Zoning restrictions, easements,
rights-of-way, title irregularities and other similar
encumbrances, which alone or in the aggregate are not
substantial in amount and do not materially detract from
the value of the property subject thereto or interfere with
the ordinary conduct of the business of Lessee or any of
its Subsidiaries;
(viii) Banker's Liens and similar Liens (including
set-off rights) in respect of bank deposits;
(ix) Liens on property or assets of any
corporation which becomes a Subsidiary of Lessee or on any
property or assets acquired by Lessee or any of its
Subsidiaries after the date of this Agreement, provided
that (A) such Liens exist at the time the stock of such
corporation or such assets or property is or are acquired
by Lessee and (B) such Liens were not created in
contemplation of such acquisition by Lessee;
(x) Judgement Liens, provided that such Liens do
not have a value in excess of $2,500,000 or such Liens are
released, stayed, vacated or otherwise dismissed within
twenty (20) days after issue or levy and, if so stayed,
such stay is not thereafter removed;
(xi) Rights of vendors or lessors under
conditional sale agreements, Capital Leases or other title
retention agreements, provided that, in each case, (A) such
rights secure or otherwise relate to Permitted
Indebtedness, (B) such rights do not extend to any property
other than property acquired with the proceeds of such
Permitted Indebtedness and (C) such rights do not secure
any Indebtedness other than such Permitted Indebtedness;
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(xii) Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of
customs duties and in connection with the importation of
goods in the ordinary course of Lessee's and its
Subsidiaries' businesses;
(xiii) Liens securing Indebtedness which
constitutes Permitted Indebtedness under clause (vii) of
Subparagraph 5.02(a) provided that, in each case, such Lien
(A) covers only those assets, the acquisition of which was
financed by such Permitted Indebtedness, and (B) secures
only such Permitted Indebtedness;
(xiv) Liens on the property or assets of any
Subsidiary of Lessee in favor of Lessee or any other
Subsidiary of Lessee;
(xv) Liens incurred in connection with the
extension, renewal or refinancing of the Indebtedness
secured by the Liens described in clause (iii) above,
provided that any extension, renewal or replacement Lien
(A) is limited to the property covered by the existing Lien
and (B) secures Indebtedness which is no greater in amount
and has material terms no less favorable to the
Participants than the Indebtedness secured by the existing
Lien;
(xvi) Liens on insurance proceeds in favor of
insurance companies with respect to the financing of
insurance premiums;
(xvii) Permitted Property Liens in the Property;
and
(xviii) Other Liens on the property of Lessee and
its Subsidiaries, provided that the aggregate principal
amount of all Indebtedness secured by such other Liens does
not exceed at any time ten percent (10%) of the
consolidated total assets of Lessee and its Subsidiaries at
such time.
(c) Asset Dispositions. Neither Lessee nor any of its
Subsidiaries shall sell, lease, transfer or otherwise dispose of any
of its assets or property, whether now owned or hereafter acquired,
except for the following:
(i) Sales of inventory by Lessee and its
Subsidiaries in the ordinary course of their businesses;
(ii) Sales of surplus, damaged, worn or obsolete
equipment or inventory for not less than fair market value;
(iii) Sales or other dispositions of Investments
permitted by clauses (i) and (iii) of Subparagraph 5.02(e)
for not less than fair market value;
(iv) Sales or assignments of defaulted
receivables to a collection agency in the ordinary course
of business;
(v) Licenses by Lessee or its Subsidiaries of its
patents, copyrights, trademarks, trade names and service
marks in the ordinary course of its business
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provided that, in each case, the terms of the transaction
are terms which then would prevail in the market for similar
transactions between unaffiliated parties dealing at arm's
length;
(vi) Sales or other dispositions of assets and
property by Lessee to any of Lessee's Subsidiaries or by
any of Lessee's Subsidiaries to Lessee or any of its other
Subsidiaries, provided that the terms of any such sales or
other dispositions by or to Lessee are terms which are no
less favorable to Lessee then would prevail in the market
for similar transactions between unaffiliated parties
dealing at arm's length;
(vii) Sales of accounts receivable of Lessee and
its Subsidiaries, provided that (A) each such sale is (1)
for not less than fair market value and (2) for cash, and
(B) the aggregate book value of all such accounts
receivable so sold in any consecutive four-quarter period
does not exceed ten percent (10%) of the consolidated total
accounts receivable of Lessee and its Subsidiaries on the
last day immediately preceding such four-quarter period;
and
(viii) Other sales, leases, transfers and
disposals of assets and property for not less than fair
market value, provided that the aggregate book value of all
such assets and property so sold, leased, transferred or
otherwise disposed of in any consecutive four-quarter
period does not exceed five percent (5%) of the
consolidated total assets of Lessee and its Subsidiaries on
the last day immediately preceding such four-quarter
period.
(d) Mergers, Acquisitions, Etc. Neither Lessee nor any of
its Subsidiaries shall consolidate with or merge into any other
Person or permit any other Person to merge into it, establish any new
Subsidiary, acquire any Person as a new Subsidiary or acquire all or
substantially all of the assets of any other Person, except for the
following:
(i) Any Subsidiary of Lessee may merge or
consolidate with any other Subsidiary of Lessee;
(ii) Any Subsidiary of Lessee may merge or
consolidate with Lessee, provided that Lessee is the
surviving corporation; and
(iii) Lessee may merge or consolidate with any
other corporation, establish a new Subsidiary, acquire any
Person as a new Subsidiary or acquire all or substantially
all of the assets of any other Person, provided that:
(A) In the case of any merger or
consolidation, either (1) Lessee is the surviving
corporation or (2) the surviving corporation (y)
is a Solvent United States corporation with a
financial condition equal to or better than the
financial condition of Lessee immediately prior to
such
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merger or consolidation and (z) assumes all of the
Lessee Obligations in a manner reasonably
acceptable to the Required Participants;
(B) No Default has occurred and is
continuing at the time of such merger,
consolidation, establishment or acquisition or
will occur after giving effect to such merger,
consolidation or acquisition; and
(C) The aggregate cost of any such
merger, consolidation, establishment or
acquisition does not exceed the amounts permitted
under Subparagraph 5.02(e)(iv).
(e) Investments. Neither Lessee nor any of its Subsidiaries
shall make any Investment except for Investments in the following:
(i) Investments of Lessee and its Subsidiaries
in Cash Equivalents;
(ii) Any transaction permitted by Subparagraph
5.02(a);
(iii) Money market mutual funds registered with
the Securities and Exchange Commission, meeting the
requirements of Rule 2a-7 promulgated under the Investment
Company Act of 1940;
(iv) Investments listed in Schedule 5.02(e)
existing on the date of this Agreement; and
(v) Other Investments, provided that the
aggregate amount of such other Investments plus the
aggregate cost of all mergers and consolidations
consummated, Subsidiaries established and Subsidiaries and
assets acquired by Lessee pursuant to Subparagraph 5.02(d)
does not exceed in any fiscal year (A) $100,000,000 for any
amounts paid in cash and (B) $500,000,000 for any amounts
paid with shares of common stock of Lessee (as determined
according to the stock price of such shares on the date of
transfer) and accounted for on a pooling basis in
accordance with GAAP.
(f) Dividends, Redemptions, Etc. Neither Lessee nor any of
its Subsidiaries shall pay any dividends or make any distributions on
its Equity Securities; purchase, redeem, retire, defease or otherwise
acquire for value any of its Equity Securities; return any capital to
any holder of its Equity Securities as such; make any distribution of
assets, Equity Securities, obligations or securities to any holder of
its Equity Securities as such; or set apart any sum for any such
purpose; except as follows:
(i) Either Lessee or any of its Subsidiaries may
pay dividends on its capital stock payable solely in such
Person's own capital stock;
(ii) Any Subsidiary of Lessee may pay dividends to
Lessee;
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(iii) Lessee may purchase shares of its capital
stock for its employee stock option plans, provided that
(A) the aggregate amount of such purchases does not exceed
$50,000,000 in any fiscal year and (B) no Default has
occurred and is continuing at the time of such purchase or
will occur after giving effect to such purchase; and
(iv) Lessee may purchase shares of its capital
stock with the proceeds received by it from a substantially
concurrent issue of new shares of its capital stock
(g) Change in Business. Neither Lessee nor any of its
Subsidiaries shall engage, either directly or indirectly through
Affiliates, in any material line of business other than the
semiconductor capital equipment business and other businesses
incidental or reasonably related thereto.
(h) ERISA. Neither Lessee nor any ERISA Affiliate shall (i)
adopt or institute any Employee Benefit Plan that is an employee
pension benefit plan within the meaning of Section 3(2) of ERISA,
(ii) take any action which will result in the partial or complete
withdrawal, within the meanings of sections 4203 and 4205 of ERISA,
from a Multiemployer Plan, (iii) engage or permit any Person to
engage in any transaction prohibited by section 406 of ERISA or
section 4975 of the IRC involving any Employee Benefit Plan or
Multiemployer Plan which would subject either Lessee or any ERISA
Affiliate to any tax, penalty or other liability including a
liability to indemnify, (iv) incur or allow to exist any accumulated
funding deficiency (within the meaning of section 412 of the IRC or
section 302 of ERISA), (v) fail to make full payment when due of all
amounts due as contributions to any Employee Benefit Plan or
Multiemployer Plan, (vi) fail to comply with the requirements of
section 4980B of the IRC or Part 6 of Title I(B) of ERISA, or (vii)
adopt any amendment to any Employee Benefit Plan which would require
the posting of security pursuant to section 401(a)(29) of the IRC,
where singly or cumulatively, the above would have a Material Adverse
Effect.
(i) Transactions With Affiliates. Neither Lessee nor any of
its Subsidiaries shall enter into any Contractual Obligation with any
Affiliate or engage in any other transaction with any Affiliate
except upon terms at least as favorable to Lessee or such Subsidiary
as an arms-length transaction with unaffiliated Persons.
(j) Accounting Changes. Neither Lessee nor any of its
Subsidiaries shall change (i) its fiscal year (currently January 1
through December 31) or (ii) its accounting practices except as
permitted by GAAP.
5.03. Lessee's Financial Covenants. Until the termination of this
Agreement and the satisfaction in full by Lessee of all Lessee Obligations,
Lessee will comply, and will cause compliance, with the following financial
covenants, unless Lessor and Required Participants shall otherwise consent in
writing:
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(a) Funded Indebtedness/Capital Ratio. Lessee shall not
permit its Funded Indebtedness/Capital Ratio on any day set forth
below to be greater than the ratio set forth opposite such day below:
June 30, 1997;
September 30, 1997................................................0.55 to 1.00;
December 31, 1997;
March 31, 1998;
June 30, 1998.....................................................0.50 to 1.00;
September 30, 1998;
December 31, 1998
March 31, 1999
June 30, 1999.....................................................0.45 to 1.00;
The last day of each
fiscal quarter thereafter.........................................0.40 to 1.00.
(b) Quick Ratio. Lessee shall not permit its Quick Ratio on
any day set forth below to be less than the ratio set forth opposite
such day below:
June 30, 1997;
September 30, 1997;
December 31, 1997...................................1.00 to 1.00;
March 31, 1998;
June 30, 1998;
September 30, 1998..................................1.25 to 1.00;
The last day of each
fiscal quarter thereafter...........................1.50 to 1.00.
(c) Debt Service Coverage Ratio. Lessee shall not permit
its Debt Service Coverage Ratio for any fiscal quarter ending on any
day set forth below to be less than the ratio set forth opposite such
day below:
June 30, 1997;
September 30, 1997;
December 31, 1997;
March 31, 1998;
June 30, 1998;
September 30, 1998......................................2.50 to 1.00;
December 31, 1998;
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March 31, 1999..........................................3.50 to 1.00;
The last day of each
fiscal quarter thereafter...........................4.50 to 1.00.
(d) Tangible Net Worth. Lessee shall not permit its
Tangible Net Worth on the last day of any fiscal quarter (such date
to be referred to herein as a "determination date") which occurs
after June 30, 1997 (such date to be referred to herein as the "base
date") to be less than the sum on such determination date of the
following:
(i) Ninety percent (90%) of the Tangible Net Worth
of Lessee and its Subsidiaries on the base date;
plus
(ii) Seventy-five percent (75%) of the sum of
Lessee's consolidated quarterly net income (ignoring any
quarterly losses) for each fiscal quarter after the base
date through and including the fiscal quarter ending on the
determination date;
plus
(iii) One hundred percent (100%) of the Net
Proceeds of all Equity Securities issued by Lessee and its
Subsidiaries (to Persons other than Lessee or its
Subsidiaries) during the period commencing on the base date
and ending on the determination date;
plus
(iv) One hundred percent (100%) of the principal
amount of all debt securities of Lessee and its
Subsidiaries converted into Equity Securities of Lessee and
its Subsidiaries during the period commencing on the base
date and ending on the determination date;
minus
(v) The lesser of (A) the sum of all
non-recurring, non-cash charges taken by Lessee and its
Subsidiaries during the period commencing on the date of
this Agreement and ending on the earlier of the
determination date and December 31, 1997 and (B)
$40,000,000.
5.04. Lessor's Covenants. Until the termination of this Agreement and
the satisfaction in full by Lessee of all Lessor Obligations, Lessor will
comply, and will cause compliance, with the following covenants, unless Lessee
and Required Participants shall otherwise consent in writing:
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(a) Use of Proceeds. Lessor shall use the proceeds of all
amounts delivered to Lessor by Participants pursuant to Subparagraph
2.05(a) solely to fund Advances.
(b) Lessor Liens. Lessor shall not create, incur, assume or
permit to exist any Lessor Lien and shall promptly discharge, at its
sole cost and expense, any Lessor Lien on the Property; provided,
however, that Lessor shall not be required so to discharge any such
Lessor Lien if (i) the same is being contested in good faith by
appropriate proceedings diligently prosecuted and (ii) any such
contest is completed and all Lessor Liens are discharged on or prior
to the Expiration Date.
(c) Property Disposition. Lessor shall not sell, lease,
transfer or otherwise dispose of its right, title and interest in the
Property and the Operative Documents except as provided in
Subparagraph 2.11(b) or Subparagraph 7.05(d) or after retaining the
Property following the Expiration Date.
(d) Chief Place of Business. Lessor shall not change its
chief place of business without giving Agent prompt written notice.
5.05. Participants' Covenants. Each Participant covenants that it
will not fund its portion of any Advance with the assets of any "employee
benefit plan" (as defined in Section 3(3) of ERISA) which is subject to Title I
of ERISA or any "plan" (as defined in Section 4975(e)(1) of the IRC.
SECTION 6. LESSOR, AGENT AND THEIR RELATIONS WITH PARTICIPANTS
6.01. Appointment of Agent. Each Participant hereby appoints and
authorizes Agent to act as its agent hereunder and under the other Operative
Documents with such powers as are expressly delegated to Agent by the terms of
this Agreement and the other Operative Documents, together with such other
powers as are reasonably incidental thereto. Lessor is not an agent for the
Participants or Agent, and neither this Agreement nor any other Operative
Document shall be construed to constitute or evidence a partnership among the
Lessor Parties or otherwise to impose upon Lessor or Agent any fiduciary duty.
6.02. Powers and Immunities. Neither Lessor nor Agent shall have any
duties or responsibilities except those expressly set forth in this Agreement or
in any other Operative Document, be a trustee for any Participant or have any
fiduciary duty to any Participant. Notwithstanding anything to the contrary
contained herein, neither Lessor nor Agent shall be required to take any action
which is contrary to this Agreement or any other Operative Document or any
applicable Governmental Rule. Neither Lessor nor Agent nor any Participant shall
be responsible to any Participant for any recitals, statements, representations
or warranties made by Lessee or any of its Subsidiaries contained in this
Agreement or in any other Operative Document, for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Operative Document or for any failure by Lessee or any of its
Subsidiaries to perform their respective obligations hereunder or thereunder.
Lessor and Agent may employ agents and attorneys-in-fact and shall not be
responsible to any Participant for the
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negligence or misconduct of any such agents or attorneys-in-fact selected by it
with reasonable care. Neither Lessor nor Agent nor any of their respective
directors, officers, employees, agents or advisors shall be responsible to any
Participant for any action taken or omitted to be taken by it or them hereunder
or under any other Operative Document or in connection herewith or therewith,
except for its or their own gross negligence or willful misconduct. Except as
otherwise provided under this Agreement, Lessor and Agent shall take such action
with respect to the Operative Documents as shall be directed by the Required
Participants.
6.03. Reliance. Lessor or Agent shall be entitled to rely upon any
certificate, notice or other document (including any cable, telegram, facsimile
or telex) believed by it in good faith to be genuine and correct and to have
been signed or sent by or on behalf of the proper Person or Persons, and upon
advice and statements of legal counsel, independent accountants and other
experts selected by Lessor or Agent with reasonable care. As to any other
matters not expressly provided for by this Agreement, neither Lessor nor Agent
shall be required to take any action or exercise any discretion, but shall be
required to act or to refrain from acting upon instructions of the Required
Participants and shall in all cases be fully protected by the Participants in
acting, or in refraining from acting, hereunder or under any other Operative
Document in accordance with the instructions of the Required Participants, and
such instructions of the Required Participants and any action taken or failure
to act pursuant thereto shall be binding on all of the Participants.
6.04. Defaults. Neither Lessor nor Agent shall be deemed to have
knowledge or notice of the occurrence of any Default unless Lessor and Agent
have received a written notice from a Participant or Lessee, referring to this
Agreement, describing such Default and stating that such notice is a "Notice of
Default". If Lessor and Agent receive such a notice of the occurrence of a
Default, Agent shall give prompt notice thereof to the Participants. Lessor and
Agent shall take such action with respect to such Default as shall be reasonably
directed by the Required Participants; provided, however, that until Lessor and
Agent shall have received such directions, Lessor or Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default as it shall deem advisable in the best interest of the
Participants.
6.05. Indemnification. Without limiting the Obligations of Lessee
hereunder, each Participant agrees to indemnify Lessor and Agent, ratably in
accordance with such Participant's Proportionate Share, for any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may at
any time be imposed on, incurred by or asserted against Lessor or Agent in any
way relating to or arising out of this Agreement or any documents contemplated
by or referred to herein or therein or the transactions contemplated hereby or
thereby or the enforcement of any of the terms hereof or thereof; provided,
however, that no Participant shall be liable for any of the foregoing to the
extent they arise from Lessor's or Agent's gross negligence or willful
misconduct. Lessor or Agent shall be fully justified in refusing to take or in
continuing to take any action hereunder unless it shall first be indemnified to
its satisfaction by the Participants against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take any such
action. The obligations of each Participant under this Paragraph 6.05 shall
survive the payment and performance of the Lessee Obligations, the termination
of this Agreement and any
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Participant ceasing to be a party to this Agreement (with respect to events
which occurred prior to the time such Participant ceased to be a Participant
hereunder).
6.06. Non-Reliance. Each Participant represents that it has,
independently and without reliance on Lessor, Agent, or any other Participant,
and based on such documents and information as it has deemed appropriate, made
its own appraisal of the business, prospects, management, financial condition
and affairs of Lessee and the Subsidiaries and its own decision to enter into
this Agreement and agrees that it will, independently and without reliance upon
Lessor, Agent or any other Participant, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
appraisals and decisions in taking or not taking action under this Agreement or
any other Operative Document. Neither Lessor nor Agent nor any of their
respective affiliates nor any of their respective directors, officers,
employees, agents or advisors shall (a) be required to keep any Participant
informed as to the performance or observance by Lessee or any of its
Subsidiaries of the obligations under this Agreement or any other document
referred to or provided for herein or to make inquiry of, or to inspect the
properties or books of Lessee or any of its Subsidiaries; (b) have any duty or
responsibility to provide any Participant with any credit or other information
concerning Lessee or any of its Subsidiaries which may come into the possession
of Lessor or Agent, except for notices, reports and other documents and
information expressly required to be furnished to the Participants by Lessor or
Agent hereunder; or (c) be responsible to any Participant for (i) any recital,
statement, representation or warranty made by Lessee or any officer, employee or
agent of Lessee in this Agreement or in any of the other Operative Documents,
(ii) the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any Operative Document, (iii) the value or
sufficiency of the Property or the validity or perfection of any of the liens or
security interests intended to be created by the Operative Documents, or (iv)
any failure by Lessee to perform its obligations under this Agreement or any
other Operative Document.
6.07. Resignation or Removal of Agent. Agent may resign at any time
by giving thirty (30) days prior written notice thereof to Lessee and the
Participants, and Agent may be removed at any time with or without cause by the
Required Participants; provided, however, that Agent shall not resign and may
not be removed without cause prior to the Commitment Termination Date without
the consent of Lessee unless a Change of Law makes it unlawful or unreasonably
burdensome for Agent to continue to act in such capacity. Upon any such
resignation or removal, the Required Participants shall have the right to
appoint a successor Agent, which Agent, if not a Participant, shall be
reasonably acceptable to Lessee; provided, however, that Lessee shall have no
right to approve a successor Agent if a Default has occurred and is continuing.
Upon the acceptance of any appointment as Agent hereunder 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 the retiring
Agent shall be discharged from the duties and obligations thereafter arising
hereunder. After any retiring Agent's resignation or removal hereunder as Agent,
the provisions of this Section VI and any other provision of this Agreement or
any other Operative Document which by its terms survives the termination of this
Agreement shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as Agent.
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6.08. Authorization. Agent is hereby authorized by the Participants
to execute, deliver and perform, each of the Operative Documents to which Agent
is or is intended to be a party and each Participant agrees to be bound by all
of the agreements of Agent contained in the Operative Documents.
6.09. Lessor and Agent in their Individual Capacities. Lessor, Agent
and their respective affiliates may make loans to, accept deposits from and
generally engage in any kind of banking or other business with Lessee and its
Subsidiaries and affiliates as though Lessor were not Lessor hereunder and Agent
were not Agent hereunder. With respect to Advances, if any, made by Agent in its
capacity as a Participant, Agent in its capacity as a Participant shall have the
same rights and powers under this Agreement and the other Operative Documents as
any other Participant and may exercise the same as though it were not Agent, and
the terms "Participant" or "Participants" shall include Agent in its capacity as
a Participant.
SECTION 7. MISCELLANEOUS
7.01. Notices. Except as otherwise provided herein, all notices,
requests, demands, consents, instructions or other communications to or upon
Lessor, Lessee, any Participant or Agent under this Agreement or the other
Operative Documents shall be in writing and faxed, mailed or delivered, if to
Lessor, Lessee or Agent, at its respective facsimile number or address set forth
below or, if to any Participant, at the address or facsimile number specified
beneath the heading "Address for Notices" under the name of such Participant in
Part B of Schedule I (or to such other facsimile number or address for any party
as indicated in any notice given by that party to the other parties). All such
notices and communications shall be effective (a) when sent by Federal Express
or other overnight service of recognized standing, on the Business Day following
the deposit with such service; (b) when mailed, first class postage prepaid and
addressed as aforesaid through the United States Postal Service, upon receipt;
(c) when delivered by hand, upon delivery; and (d) when faxed, upon confirmation
of receipt; provided, however, that any Advance Request, Notice of Rental Period
Selection, Extension Request, Notice of Term Purchase Option Exercise, Notice of
Marketing Option Exercise or Notice of Expiration Date Purchase Option Exercise
delivered to Lessor or Agent shall not be effective until received by Lessor or
Agent.
Lessee: Novellus Systems, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No: (▇▇▇) ▇▇▇-▇▇▇▇
Lessor: Lease Plan U.S.A., Inc.
c/o ABN AMRO Bank N.V.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No: (▇▇▇) ▇▇▇-▇▇▇▇
Agent: ABN AMRO Bank N.V.
ABN AMRO Bank North America, Inc.
Capital Markets-Syndications Group
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
ABN AMRO Bank N.V.
ABN AMRO Bank North America, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Each Advance Request, Notice of Rental Period Selection, Extension Request,
Notice of Term Purchase Option Exercise, Notice of Marketing Option Exercise and
Notice of Expiration Date Purchase Option Exercise shall be given by Lessee to
Agent's office located at its address referred to above during its normal
business hours; provided, however, that any such notice received by Agent after
10:00 a.m. on any Business Day shall be deemed received by Agent on the next
Business Day. In any case where this Agreement authorizes notices, requests,
demands or other communications by Lessee to any Lessor Party to be made by
telephone or facsimile, any Lessor Party may conclusively presume that anyone
purporting to be a person designated in any incumbency certificate or other
similar document received by such Lessor Party is such a person.
7.02. Expenses. Lessee shall pay on demand, whether or not any
Advance is made hereunder, (a) all reasonable fees and expenses, including
reasonable attorneys' fees and expenses, incurred by Lessor and Agent in
connection with the preparation, negotiation, execution and delivery of, the
consummation of the transactions contemplated by and the exercise of their
duties under, this Agreement and the other Operative Documents, and the
preparation, negotiation, execution and delivery of amendments and waivers
hereunder and thereunder and (b) all reasonable fees and expenses, including
reasonable attorneys' fees and expenses, incurred by the Lessor Parties in the
enforcement or attempted enforcement of any of the Lessee Obligations or in
preserving any of the Lessor Parties' rights and remedies (including all such
fees and expenses incurred in connection with any "workout" or restructuring
affecting
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the Operative Documents or the Lessee Obligations or any bankruptcy or
similar proceeding involving Lessee or any of its Subsidiaries). As used herein,
the term "reasonable attorneys' fees and expenses" shall include, without
limitation, allocable costs and expenses of Agent's and Participants' in-house
legal counsel and staff. The obligations of Lessee under this Paragraph 7.02
shall survive the payment and performance of the Lessee Obligations and the
termination of this Agreement.
7.03. Indemnification. To the fullest extent permitted by law, Lessee
agrees to protect, indemnify, defend and hold harmless, on an after-tax basis,
the Lessor Parties and the other Indemnitees from and against any and all
liabilities, losses, damages or expenses of any kind or nature (including
Indemnified Taxes) and from any suits, claims or demands (including in respect
of or for reasonable attorney's fees and other expenses) arising on account of
or in connection with any matter or thing or action or failure to act by
Indemnitees, or any of them, arising out of or relating to the Operative
Documents, any transaction contemplated thereby or the Property (including any
use by Lessee of the Property or the Advances), except to the extent such
liability arises from the willful misconduct or gross negligence of such
Indemnitee. Upon receiving knowledge of any suit, claim or demand asserted by a
third party that any Lessor Party believes is covered by this indemnity, such
Lessor Party promptly shall give Lessee notice of the matter and an opportunity
to defend it, at Lessee's sole cost and expense, with legal counsel reasonably
satisfactory to such Lessor Party. Such Lessor Parties may also require Lessee
to defend the matter. Any failure or delay of any Lessor Party to notify Lessee
of any such suit, claim or demand shall not relieve Lessee of its obligations
under this Paragraph 7.03. The obligations of Lessee under this Paragraph 7.03
shall survive the payment and performance of the Lessee Obligations and the
termination of this Agreement.
7.04. Waivers; Amendments. Any term, covenant, agreement or condition
of this Agreement or any other Operative Document may be amended or waived if
such amendment or waiver is in writing and is signed by Lessor, Lessee and the
Required Participants; provided, however that:
(a) Any amendment, waiver or consent which (i) increases
the Total Commitment, (ii) extends the Scheduled Expiration Date,
(iii) reduces the Rental Rate or any fees or other amounts payable
for the account of the Participants hereunder, (iv) postpones any
date scheduled for any payment of Base Rent or any fees or other
amounts payable for the account of the Participants hereunder or
thereunder, (v) amends this Paragraph 7.04, (vi) amends the
definition of Required Participants or (vii) releases Lessor's
interest in any substantial part of the Property, must be in writing
and signed or approved in writing by all Participants;
(b) Any amendment, waiver or consent which amends Paragraph
2.06 and adversely affects the Tranche A Participants, the Tranche B
Participants or the Tranche C Participants as a group must be in
writing and signed by each Participant that is a member of such
group;
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(c) Any amendment, waiver or consent which increases or
decreases the Proportionate Share of any Participant must be in
writing and signed by such Participant; and
(d) Any amendment, waiver or consent which affects the
rights or obligations of Agent must be in writing and signed by
Agent.
No failure or delay by any Lessor Party in exercising any right hereunder shall
operate as a waiver thereof or of any other right nor shall any single or
partial exercise of any such right preclude any other further exercise thereof
or of any other right. Unless otherwise specified in such waiver or consent, a
waiver or consent given hereunder shall be effective only in the specific
instance and for the specific purpose for which given.
7.05. Successors and Assigns.
(a) Binding Effect. This Agreement and the other Operative
Documents shall be binding upon and inure to the benefit of Lessee,
Lessor, the Participants, Agent and their respective permitted
successors and assigns. All references in this Agreement to any
Person shall be deemed to include all successors and assigns of such
Person.
(b) Participant Assignments.
(i) Any Participant may, at any time, sell and
assign to any other Participant or any Eligible Assignee
(individually, an "Assignee Participant") all or a portion
of its rights and obligations under this Agreement and the
other Operative Documents (such a sale and assignment to be
referred to herein as an "Assignment") pursuant to an
assignment agreement in the form of Exhibit M (an
"Assignment Agreement"), executed by each Assignee
Participant and such assignor Participant (an "Assignor
Participant") and delivered to Agent for its acceptance and
recording in the Register; provided, however, that:
(A) Without the written consent of
Lessor, Agent and, if no Default has occurred and
is continuing, Lessee (which consent of Lessor,
Agent and Lessee shall not be unreasonably
withheld), no Participant may make any Assignment
to any Assignee Participant which is not,
immediately prior to such Assignment, a
Participant hereunder or an Affiliate thereof; or
(B) Without the written consent of
Lessor, Agent and, if no Default has occurred and
is continuing, Lessee (which consent of Lessor,
Agent and Lessee shall not be unreasonably
withheld), no Participant may make any Assignment
of its Outstanding Tranche A Participation Amount
or its Outstanding Tranche B Participation Amount
under either Facility which does not assign and
delegate an equal pro rata interest in (1) such
Participant's Outstanding Tranche A Participation
Amount and its
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Outstanding Tranche B Participation Amount under
both Facilities, (2) such Participant's Tranche A
Percentage and its Tranche B Percentage under both
Facilities, and (3) such Participant's other
rights, duties and obligations relating to the
Tranche A Portion and the Tranche B Portion of
both Facilities under this Agreement and the other
Operative Documents; or
(C) Without the written consent of
Lessor, Agent and, if no Default has occurred and
is continuing, Lessee (which consent of Lessor,
Agent and Lessee shall not be unreasonably
withheld), no Tranche C Participant may make any
Assignment of its Outstanding Tranche C
Participation Amount under either Facility which
does not assign and delegate an equal pro rata
interest in (1) such Participant's Outstanding
Tranche C Participation Amount under both
Facilities, (2) such Participant's Tranche C
Percentage under both Facilities, and (3) such
Participant's other rights, duties and
obligations relating to the Tranche C Portion of
both Facilities under this Agreement and the
other Operative Documents; or
(D) Without the written consent of
Lessor, Agent and, if no Default has occurred and
is continuing, Lessee (which consent of Lessor,
Agent and Lessee shall not be unreasonably
withheld), no Participant may make any Assignment
to any Assignee Participant if, after giving
effect to such Assignment, the Commitment of such
Participant or such Assignee Participant
hereunder would be less than Five Million Dollars
($5,000,000.00); provided, however, that a
Participant may, without the written consent of
Lessor, Lessee and Agent, make an Assignment
hereunder that reduces its Commitment hereunder
to zero.
Upon such execution, delivery, acceptance and
recording of each Assignment Agreement, from and after the
Assignment Effective Date determined pursuant to such
Assignment Agreement, (y) each Assignee Participant
thereunder shall be a Participant hereunder with a Tranche
A Percentage, Tranche B Percentage, Tranche C Percentage
and Proportionate Share under each Facility as set forth on
Attachment 1 to such Assignment Agreement (under the
caption "Tranche Percentages and Proportionate Shares After
Assignment") and shall have the rights, duties and
obligations of such a Participant under this Agreement and
the other Operative Documents, and (z) the Assignor
Participant thereunder shall be a Participant with a
Tranche A Percentage, Tranche B Percentage, Tranche C
Percentage and Proportionate Share under each Facility as
set forth on Attachment 1 to such Assignment Agreement
(under the caption "Tranche Percentages and Proportionate
Shares After Assignment") , or, if the Proportionate Share
of the Assignor Participant has been reduced to 0%, the
Assignor Participant shall cease to be a Participant and to
have any obligation to fund any portion of any Advance;
provided, however, that any such Assignor Participant which
ceases to be a
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Participant shall continue to be entitled to the benefits of
any provision of this Agreement which by its terms survives
the termination of this Agreement. Each Assignment Agreement
shall be deemed to amend Schedule I to the extent, and only
to the extent, necessary to reflect the addition of each
Assignee Participant, the deletion of each Assignor
Participant which reduces its Proportionate Share to 0% and
the resulting adjustment of Tranche A Percentages, Tranche B
Percentages, Tranche C Percentages and Proportionate Shares
arising from the purchase by each Assignee Participant of
all or a portion of the rights and obligations of an
Assignor Participant under this Agreement and the other
Operative Documents. Each Assignee Participant which was not
previously a Participant hereunder and which is not
incorporated under the laws of the United States of America
or a state thereof shall, within three (3) Business Days of
becoming a Participant, deliver to Lessee and Agent two duly
completed copies of United States Internal Revenue Service
Form 1001 or 4224 (or successor applicable form), as the
case may be, certifying in each case that such Participant
is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income
taxes. (Without limiting the generality of any of the
preceding provisions of this clause (i) of Subparagraph
7.05(b), no Participant may, if Lessee shall object in
writing, make any Assignment to any Assignee Participant
that, at the time of such Assignment, (1) has a basis for
demanding any payment under Subparagraph 2.12(c) or
Subparagraph 2.12(d) in excess of the pro rata amount that
then could be demanded thereunder by the Participant
proposing to make such Assignment or (2) would require
Borrower to make any payment under Subparagraph 2.13(a) on
account of payments to such Assignee Participant in excess
of the pro rata amount that Lessee was then required to make
thereunder on account of payments to the Participant
proposing to make such Assignment.)
(ii) Agent shall maintain at its address referred
to in Paragraph 7.01 a copy of each Assignment Agreement
delivered to it and a register (the "Register") for the
recordation of the names and addresses of the Participants
and the Tranche A Percentage, Tranche B Percentage, Tranche
C Percentage and Proportionate Share of each Participant
under each Facility from time to time. The entries in the
Register shall be conclusive in the absence of manifest
error, and Lessee, Agent and the Participants may treat each
Person whose name is recorded in the Register as the owner
of the interests recorded therein for all purposes of this
Agreement. The Register shall be available for inspection by
Lessee or any Participant at any reasonable time and from
time to time upon reasonable prior notice.
(iii) Upon its receipt of an Assignment Agreement
executed by an Assignor Participant and an Assignee
Participant (and, to the extent required by clause (i) of
this Subparagraph 7.05(b), by Lessor, Agent and Lessee),
together with payment to Agent by Assignor Participant of a
registration and processing fee of $2,500, Agent shall (A)
promptly accept such Assignment Agreement and (B) on the
Assignment Effective Date determined pursuant thereto record
the
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information contained therein in the Register and give
notice of such acceptance and recordation to Lessor, the
Participants and Lessee. Agent may, from time to time at its
election, prepare and deliver to Lessor, the Participants
and Lessee a revised Schedule I reflecting the names,
addresses and respective Proportionate Shares of all
Participants then parties hereto.
(iv) Subject to Subparagraph 7.13(g), the Lessor
Parties may disclose the Operative Documents and any
financial or other information relating to Lessee or any
Subsidiary to each other or to any potential Assignee
Participant.
(c) Participant Subparticipations. Any Participant may at
any time sell to one or more Persons ("Subparticipants")
subparticipation interests in the rights and interests of such
Participant under this Agreement and the other Operative Documents.
In the event of any such sale by a Participant of subparticipation
interests, such Participant's obligations under this Agreement and
the other Operative Documents shall remain unchanged, such
Participant shall remain solely responsible for the performance
thereof and Lessee and the other Lessor Parties shall continue to
deal solely and directly with such Participant in connection with
such Participant's rights and obligations under this Agreement. Any
agreement pursuant to which any such sale is effected may require the
selling Participant to obtain the consent of the Subparticipant in
order for such Participant to agree in writing to any amendment,
waiver or consent of a type specified in clause (i), (ii), (iii) or
(iv) of Subparagraph 7.04(a) but may not otherwise require the
selling Participant to obtain the consent of such Subparticipant to
any other amendment, waiver or consent hereunder. Lessee agrees that
any Participant which has transferred any subparticipation interest
shall, notwithstanding any such transfer, be entitled to the full
benefits accorded such Participant under Paragraph 2.12, Paragraph
2.13, and Paragraph 2.14, as if such Participant had not made such
transfer.
(d) Lessor Assignments. Lessor may, upon one (1) month's
prior written notice to Lessee and Agent, sell and assign all of its
right, title and interest in the Property and its rights, powers,
privileges, duties and obligations under this Agreement and the other
Operative Documents, provided that:
(i) If such sale and assignment is effected after
either (A) the occurrence of a Change of Law which makes it
unlawful or unreasonably burdensome for Lessor to hold legal
or beneficial title to the Property or to perform its
obligations and duties under this Agreement and the other
Operative Documents or (B) the resignation or removal of the
Agent which was the Agent at the time Lessor became the
Lessor, the purchaser/assignee (the "successor Lessor")
shall be either (1) a Participant or an Eligible Assignee
that is a multi-asset Person having substantial assets
beyond its interest in the Property and the Operative
Documents or (2) a Person approved as provided in clause
(ii) below; or
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(ii) If such sale and assignment is effected in
any other circumstance, the successor Lessor shall be
approved in writing by Agent, Required Participants and, if
no Default has occurred and is continuing, Lessee (which
consents of Agent, Required Participants and Lessee shall
not be unreasonably withheld), provided that Lessee shall
have no obligation to consent to any such sale and
assignment prior to the Commitment Termination Date; and
(iii) The successor Lessor executes such
documents, instruments and agreements as may reasonably be
necessary to evidence its agreement to assume all of the
obligations and duties of the Lessor under this Agreement
and the other Operative Documents.
Upon the consummation of any such sale and assignment, (A) the
successor Lessor shall become the "Lessor" and shall succeed to and
become vested with all the rights, powers, privileges, duties and
obligations of the Lessor under this Agreement and the other
Operative Documents and (B) the retiring Lessor shall be discharged
from the duties and obligations of the Lessor thereafter arising
under this Agreement and the other Operative Documents. After any
retiring Lessor's discharge as the Lessor, the provisions of Section
VI and any other provision of this Agreement or any other Operative
Document which by its terms survives the termination of this
Agreement shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by it while it was acting as the
Lessor. Unless a sale and assignment by Lessor of its right, title
and interest in the Property under this subparagraph is made by
Lessor pursuant to clause (i) above, Lessor shall pay any real
property transfer taxes payable as a result of such sale and
assignment.
7.06. Setoff. In addition to any rights and remedies of the
Participants provided by law, each Participant shall have the right, with the
prior written consent of Agent, but without prior notice to or consent of
Lessee, any such notice and consent being expressly waived by Lessee to the
extent permitted by applicable law, upon the occurrence and during the
continuance of an Event of Default, to set-off and apply against the Lessee
Obligations, whether matured or unmatured, any amount owing from such
Participant to Lessee, at or at any time after, the occurrence of such Event of
Default. The aforesaid right of set-off may be exercised by such Participant
against Lessee or against any trustee in bankruptcy, debtor in possession,
assignee for the benefit of creditors, receiver or execution, judgment or
attachment creditor of Lessee or against anyone else claiming through or against
Lessee or such trustee in bankruptcy, debtor in possession, assignee for the
benefit of creditors, receiver, or execution, judgment or attachment creditor,
notwithstanding the fact that such right of set-off shall not have been
exercised by such Participant prior to the occurrence of an Event of Default.
Each Participant agrees promptly to notify Lessee after any such set-off and
application made by such Participant, provided that the failure to give such
notice shall not affect the validity of such set-off and application.
7.07. No Third Party Rights. Nothing expressed in or to be implied
from this Agreement is intended to give, or shall be construed to give, any
Person, other than the parties hereto and their permitted successors and assigns
hereunder, any benefit or legal or equitable
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right, remedy or claim under or by virtue of this Agreement or under or by
virtue of any provision herein.
7.08. Partial Invalidity. If at any time any provision of this
Agreement or any other Operative Document is or becomes illegal, invalid or
unenforceable in any respect under the law or any jurisdiction, neither the
legality, validity or enforceability of the remaining provisions of this
Agreement or the other Operative Documents nor the legality, validity or
enforceability of such provision under the law of any other jurisdiction shall
in any way be affected or impaired thereby.
7.09. JURY TRIAL. EACH OF LESSEE AND THE LESSOR PARTIES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY AS TO ANY ISSUE RELATING TO THE OPERATIVE DOCUMENTS IN ANY
ACTION, PROCEEDING, OR COUNTERCLAIM ARISING OUT OF OR RELATING TO ANY OPERATIVE
DOCUMENT.
7.10. Counterparts. This Agreement may be executed in any number of
identical counterparts, any set of which signed by all the parties hereto shall
be deemed to constitute a complete, executed original for all purposes.
7.11. No Joint Venture, Etc. Neither this Agreement nor any other
Operative Document nor any transaction contemplated hereby or thereby shall be
construed to (a) constitute a partnership or joint venture between Lessee and
any Lessor Party or (b) impose upon any Lessor Party any agency relationship
with or fiduciary duty to Lessee.
7.12. Usury Savings Clause. Nothing contained in this Agreement or
any other Operative Documents shall be deemed to require the payment of interest
or other charges by Lessee in excess of the amount the applicable Lessor Parties
may lawfully charge under applicable usury laws. In the event any Lessor Party
shall collect monies which are deemed to constitute interest which would
increase the effective interest rate to a rate in excess of that permitted to be
charged by applicable law, all such sums deemed to constitute excess interest
shall, upon such determination, at the option of Lessor, be returned to Lessee
or credited against other Lessee Obligations.
7.13. Confidentiality. No Lessor Party shall disclose to any Person
any information with respect to Lessee or any of its Subsidiaries which is
furnished pursuant to this Agreement or under the other Operative Documents,
except that any Lessor Party may disclose any such information (a) to its own
directors, officers, employees, auditors, counsel and other advisors and to its
Affiliates; (b) to any other Lessor Party; (c) which is otherwise available to
the public; (d) if required or appropriate in any report, statement or testimony
submitted to any Governmental Authority having or claiming to have jurisdiction
over such Lessor Party; (e) if required or appropriate in response to any
summons or subpoena or in connection with any litigation; (f) to comply with any
Requirement of Law applicable to such Lessor Party; (g) to any Assignee
Participant or Subparticipant or any prospective Assignee Participant or
Subparticipant, provided that such Assignee Participant or Subparticipant or
prospective Assignee Participant or Subparticipant agrees to be bound by this
Paragraph 7.13; or (h) otherwise with the prior consent
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of Lessee; provided, however, that any disclosure made in violation of this
Agreement shall not affect the obligations of Lessee and its Subsidiaries under
this Agreement and the other Operative Documents.
[The first signature page follows.]
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IN WITNESS WHEREOF, Lessee, Lessor, the Participants and Agent have
caused this Agreement to be executed as of the day and year first above written.
LESSEE: NOVELLUS SYSTEMS, INC.
By:_____________________________
Name:________________________
Title:_______________________
LESSOR: LEASE PLAN U.S.A., INC.
By:_____________________________
Name:________________________
Title:_______________________
AGENT: ABN AMRO BANK N.V.
By:______________________________
Name:_________________________
Title:________________________
By:___________________________
Name:_________________________
Title:________________________
PARTICIPANTS: ABN AMRO BANK N.V.
By:______________________________
Name:_________________________
Title:________________________
By:______________________________
Name:_________________________
Title:________________________
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PARTICIPANTS: LEASE PLAN NORTH AMERICA, INC.
By:_____________________________
Name:________________________
Title:_______________________
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