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Exhibit 10.31
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LEASE AGREEMENT
Dated as of February 1, 1999
between
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually,
but solely as the Owner Trustee
under the SRI Realty Trust 1998-1,
as Lessor
and
STERILE RECOVERIES, INC.,
as Lessee
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This Lease Agreement is subject to a security interest in favor of First Union
National Bank ("Bank") under a Security Agreement dated as of February 1, 1999
between First Security Bank, National Association, not individually, but solely
as the Owner Trustee under the SRI Realty Trust 1998-1 and the Bank, as
amended, modified, extended, supplemented, restated and/or replaced from time
to time in accordance with the applicable provisions thereof. This Lease
Agreement has been executed in several counterparts. To the extent, if any,
that this Lease Agreement constitutes chattel paper (as such term is defined in
the Uniform Commercial Code as in effect in any applicable jurisdiction), no
security interest in this Lease Agreement may be created through the transfer
or possession of any counterpart other than the original counterpart containing
the receipt therefor executed by the Bank on the signature page hereof.
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TABLE OF CONTENTS
ARTICLE I ............................................................................................. 1
1.1 Definitions............................................................................... 1
1.2 Interpretation............................................................................ 2
ARTICLE II ............................................................................................ 2
2.1 Property.................................................................................. 2
2.2 Lease Term................................................................................ 2
2.3 Title..................................................................................... 2
2.4 Lease Supplements......................................................................... 3
ARTICLE III ........................................................................................... 3
3.1 Rent...................................................................................... 3
3.2 Payment of Basic Rent..................................................................... 3
3.3 Supplemental Rent......................................................................... 3
3.4 Performance on a Non-Business Day......................................................... 4
3.5 Rent Payment Provisions................................................................... 4
ARTICLE IV ............................................................................................ 5
4.1 Taxes; Utility Charges.................................................................... 5
ARTICLE V ............................................................................................. 5
5.1 Quiet Enjoyment........................................................................... 5
ARTICLE VI ............................................................................................ 5
6.1 Net Lease................................................................................. 5
6.2 No Termination or Abatement............................................................... 6
ARTICLE VII ........................................................................................... 7
7.1 Ownership of the Properties............................................................... 7
ARTICLE VIII .......................................................................................... 8
8.1 Condition of the Properties............................................................... 8
8.2 Possession and Use of the Properties...................................................... 9
8.3 Integrated Properties.....................................................................10
ARTICLE IX ............................................................................................10
9.1 Compliance With Legal Requirements, Insurance Requirements and
Manufacturer's Specifications and Standards.............................................10
ARTICLE X .............................................................................................11
10.1 Maintenance and Repair; Return...........................................................11
10.2 Environmental Inspection.................................................................12
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ARTICLE XI ............................................................................................12
11.1 Modifications............................................................................12
ARTICLE XII ...........................................................................................13
12.1 Warranty of Title........................................................................13
ARTICLE XIII ..........................................................................................14
13.1 Permitted Contests Other Than in Respect of Indemnities..................................14
13.2 Impositions, Utility Charges, Other Matters; Compliance with Legal Requirements..........15
ARTICLE XIV ...........................................................................................15
14.1 Public Liability and Workers' Compensation Insurance.....................................15
14.2 Permanent Hazard and Other Insurance.....................................................15
14.3 Coverage.................................................................................16
ARTICLE XV ............................................................................................17
15.1 Casualty and Condemnation................................................................17
15.2 Environmental Matters....................................................................19
15.3 Notice of Environmental Matters..........................................................20
ARTICLE XVI ...........................................................................................21
16.1 Termination Upon Certain Events..........................................................21
16.2 Procedures...............................................................................21
ARTICLE XVII ..........................................................................................21
17.1 Lease Events of Default..................................................................21
17.2 Surrender of Possession..................................................................24
17.3 Reletting................................................................................25
17.4 Damages..................................................................................25
17.5 Power of Sale............................................................................26
17.6 Final Liquidated Damages.................................................................26
17.7 Environmental Costs......................................................................26
17.8 Waiver of Certain Rights.................................................................27
17.9 Assignment of Rights Under Contracts.....................................................27
17.10 Remedies Cumulative.....................................................................27
ARTICLE XVIII .........................................................................................27
18.1 Lessor's Right to Cure Lessee's Lease Defaults...........................................27
ARTICLE XIX ...........................................................................................28
19.1 Provisions Relating to Lessee's Exercise of its Purchase Option..........................28
19.2 No Purchase or Termination With Respect to Less than All of a Property...................28
ARTICLE XX ............................................................................................28
20.1 Purchase Option or Sale Option-General Provisions........................................28
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20.2 Lessee Purchase Option...................................................................29
20.3 Third Party Sale Option..................................................................30
ARTICLE XXI ...........................................................................................31
21.1 [Intentionally Omitted]..................................................................31
ARTICLE XXII ..........................................................................................31
22.1 Sale Procedure...........................................................................31
22.2 Application of Proceeds of Sale..........................................................34
22.3 Indemnity for Excessive Wear.............................................................34
22.4 Appraisal Procedure......................................................................34
22.5 Certain Obligations Continue.............................................................35
ARTICLE XXIII .........................................................................................35
23.1 Holding Over.............................................................................35
ARTICLE XXIV ..........................................................................................36
24.1 Risk of Loss.............................................................................36
ARTICLE XXV ...........................................................................................36
25.1 Assignment...............................................................................36
25.2 Subleases................................................................................36
ARTICLE XXVI ..........................................................................................37
26.1 No Waiver................................................................................37
ARTICLE XXVII .........................................................................................37
27.1 Acceptance of Surrender..................................................................37
27.2 No Merger of Title.......................................................................37
ARTICLE XXVIII ........................................................................................38
28.1 Incorporation of Covenants...............................................................38
ARTICLE XXIX ..........................................................................................39
29.1 Notices..................................................................................39
ARTICLE XXX ...........................................................................................39
30.1 Miscellaneous............................................................................39
30.2 Amendments and Modifications.............................................................39
30.3 Successors and Assigns...................................................................39
30.4 Headings and Table of Contents...........................................................39
30.5 Counterparts.............................................................................39
30.6 GOVERNING LAW............................................................................39
30.7 Calculation of Rent......................................................................40
30.8 Memoranda of Lease and Lease Supplements.................................................40
30.9 [Intentionally Left Blank]...............................................................40
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30.10 Limitations on Recourse.................................................................40
30.11 WAIVERS OF JURY TRIAL...................................................................40
30.12 Exercise of Lessor Rights...............................................................41
30.13 SUBMISSION TO JURISDICTION; VENUE; ARBITRATION..........................................41
30.14 USURY SAVINGS PROVISION.................................................................41
30.15 ACKNOWLEDGMENT OF HEAD LEASE; BOND DOCUMENTS............................................42
EXHIBITS
EXHIBIT A - Lease Supplement No. ____
EXHIBIT B - Memorandum of Lease and Lease Supplement No. ____
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LEASE AGREEMENT
THIS LEASE AGREEMENT dated as of February 1, 1999 (as amended,
modified, extended, supplemented, restated and/or replaced from time to time,
this "Lease") is between FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national
banking association, having its principal office at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, not individually, but solely as the Owner Trustee under
the SRI Realty Trust 1998-1, as lessor (the "Lessor"), and STERILE RECOVERIES,
INC., a Florida corporation, having its principal place of business at ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, as lessee (the "Lessee").
W I T N E S S E T H:
A. WHEREAS, subject to the terms and conditions of the Participation
Agreement and the Agency Agreement, Lessor will (i) purchase, lease pursuant to
one (1) or more Head Leases or ground lease various parcels of real property,
some of which will (or may) have existing Improvements thereon, from one (1) or
more third parties designated by Lessee and (ii) fund or otherwise finance the
acquisition, installation, testing, use, development, construction, operation,
maintenance, repair, refurbishment and restoration of the Properties by the
Construction Agent; and
B. WHEREAS, the Term shall commence with respect to each Property upon
the Property Closing Date with respect thereto; provided, Basic Rent with
respect thereto shall not be payable until the applicable Rent Commencement
Date; and
C. WHEREAS, Lessor desires to lease or sublease, as the case may be,
to Lessee, and Lessee desires to lease or sublease, as the case may be, from
Lessor, each Property;
NOW, THEREFORE, in consideration of the foregoing, and of other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
1.1 DEFINITIONS.
For purposes of this Lease, capitalized terms used in this Lease
and not otherwise defined herein shall have the meanings assigned to them in
Appendix A to that certain Participation Agreement dated as of February 1, 1999
(as amended, modified, extended, supplemented, restated and/or replaced from
time to time in accordance with the applicable provisions thereof, the
"Participation Agreement") among Lessee, Lessor and First Union National Bank,
as Lender and Holder ("Bank"). Unless otherwise indicated, references in this
Lease to articles, sections, paragraphs, clauses, appendices, schedules and
exhibits are to the same contained in this Lease.
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1.2 INTERPRETATION.
The rules of usage set forth in Appendix A to the Participation
Agreement shall apply to this Lease.
ARTICLE II
2.1 PROPERTY.
Subject to the terms and conditions hereinafter set forth and
contained in the respective Lease Supplement relating to each Property, Lessor
hereby leases to Lessee and Lessee hereby leases from Lessor, each Property.
2.2 LEASE TERM.
The term of this Lease with respect to each Property (the
"Term") shall begin upon the Property Closing Date for such Property (in each
case the "Commencement Date") and shall end on the third annual anniversary of
the Initial Closing Date, unless the Term is earlier terminated; provided,
however, with respect to any Property financed with the proceeds of Bonds, the
Term shall end on an interest payment date with respect to such Bonds, which
interest payment date shall be no later than fifteen (15) days after the third
annual anniversary of the Initial Closing Date; provided, further, that in the
event such interest payment date with respect to such Bonds is later than
fifteen (15) days after the third annual anniversary of the Initial Closing
Date, the Term with respect to such Property shall end on the interest payment
date immediately preceding the third annual anniversary of the Initial Closing
Date. Notwithstanding the foregoing, Lessee shall not be obligated to pay Basic
Rent until the Rent Commencement Date with respect to such Property.
2.3 TITLE.
Each Property is leased to Lessee without any representation or
warranty, express or implied, by Lessor and subject to the rights of parties in
possession (if any), the existing state of title (including without limitation
the Permitted Liens) and all applicable Legal Requirements. Lessee shall in no
event have any recourse against Lessor for any defect in Lessor's title to any
Property or any interest of Lessee therein (other than for Lessor Liens) or as
a result of the lack of validity or enforceability of any provision of any Head
Lease, and the obligations of Lessee hereunder, including without limitation
with respect to the payment of all Rent, shall remain in full force and effect.
The parties hereto acknowledge that, with respect to any Property subject to a
Head Lease, the Lessor has only such interest in such Property as arises under
such Head Lease.
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2.4 LEASE SUPPLEMENTS.
On or prior to each Commencement Date, Lessee and Lessor shall
each execute and deliver a Lease Supplement for the Property to be leased
effective as of such Commencement Date in substantially the form of Exhibit A
hereto.
ARTICLE III
3.1 RENT.
(a) Lessee shall pay Basic Rent in arrears on each Payment Date,
and on any date on which this Lease shall terminate with respect to
any or all Properties during the Term; provided, however, with respect
to each individual Property Lessee shall have no obligation to pay
Basic Rent with respect to such Property until the Rent Commencement
Date with respect to such Property (notwithstanding that Basic Rent
for such Property shall accrue from and including the Scheduled
Interest Payment Date immediately preceding such Rent Commencement
Date).
(b) Basic Rent shall be due and payable in lawful money of the
United States and shall be paid by wire transfer of immediately
available funds on the due date therefor (or within the applicable
grace period) to such account or accounts at such bank or banks as
Lessor shall from time to time direct.
(c) Lessee's inability or failure to take possession of all or
any portion of any Property when delivered by Lessor, whether or not
attributable to any act or omission of Lessor, the Construction Agent,
Lessee or any other Person or for any other reason whatsoever, shall
not delay or otherwise affect Lessee's obligation to pay Rent for such
Property in accordance with the terms of this Lease.
(d) Lessee shall make all payments of Rent prior to 12:00 Noon,
Charlotte, North Carolina time, on the applicable date for payment of
such amount.
3.2 PAYMENT OF BASIC RENT.
Basic Rent shall be paid absolutely net to Lessor or its
designee, so that this Lease shall yield to Lessor the full amount thereof,
without setoff, deduction or reduction.
3.3 SUPPLEMENTAL RENT.
Lessee shall pay to the Person entitled thereto any and all
Supplemental Rent when and as the same shall become due and payable, and if
Lessee fails to pay any Supplemental Rent within three (3) days after the same
is due, Lessor shall have all rights, powers and remedies provided for herein
or by law or equity or otherwise in the case of nonpayment of Basic Rent. All
such payments of Supplemental Rent shall be in the full amount thereof, without
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setoff, deduction or reduction. Lessee shall pay to the appropriate Person, as
Supplemental Rent due and owing to such Person, among other things, on demand,
(a) any and all payment obligations (excluding amounts payable as Basic Rent
but including without limitation LOC Reimbursement Amounts subject to the
provisions of Section 2.3(a) of the Credit Agreement regarding accrual of such
amounts until the Completion Date for each Property, as applicable) owing from
time to time under the Operative Agreements by any Person to the Bank or any
other Person, (b) interest at the applicable Overdue Rate on any installment of
Basic Rent not paid when due (subject to the applicable grace period) for the
period for which the same shall be overdue and on any payment of Supplemental
Rent not paid when due or demanded by the appropriate Person (subject to any
applicable grace period) for the period from the due date or the date of any
such demand, as the case may be, until the same shall be paid and (c) amounts
referenced as Supplemental Rent obligations pursuant to Section 8.3 of the
Participation Agreement. It shall be an additional Supplemental Rent obligation
of Lessee to pay to the appropriate Person all rent and other amounts when such
become due and owing from time to time under each Ground Lease and each Head
Lease and without the necessity of any notice from Lessor with regard thereto.
The expiration or other termination of Lessee's obligations to pay Basic Rent
hereunder shall not limit or modify the obligations of Lessee with respect to
Supplemental Rent. Unless expressly provided otherwise in this Lease, in the
event of any failure on the part of Lessee to pay and discharge any
Supplemental Rent as and when due, Lessee shall also promptly pay and discharge
any fine, penalty, interest or cost which may be assessed or added for
nonpayment or late payment of such Supplemental Rent, all of which shall also
constitute Supplemental Rent.
3.4 PERFORMANCE ON A NON-BUSINESS DAY.
If any Basic Rent is required hereunder on a day that is not a
Business Day, then such Basic Rent shall be due on the corresponding Scheduled
Interest Payment Date. If any Supplemental Rent is required hereunder on a day
that is not a Business Day, then such Supplemental Rent shall be due on the
next succeeding Business Day.
3.5 RENT PAYMENT PROVISIONS.
Lessee shall make payment of all Basic Rent and Supplemental
Rent when due (subject to the applicable grace periods) regardless of whether
any of the Operative Agreements pursuant to which same is calculated and is
owing shall have been rejected, avoided or disavowed in any bankruptcy or
insolvency proceeding involving any of the parties to any of the Operative
Agreements. Such provisions of such Operative Agreements and their related
definitions are incorporated herein by reference and shall survive any
termination, amendment or rejection of any such Operative Agreements.
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ARTICLE IV
4.1 TAXES; UTILITY CHARGES.
Lessee shall pay or cause to be paid all Impositions with
respect to the Properties and/or the use, occupancy, operation, repair, access,
maintenance or operation thereof and all charges for electricity, power, gas,
oil, water, telephone, sanitary sewer service and all other rents, utilities
and operating expenses of any kind or type used in or on any Property and
related real property during the Term. Upon Lessor's request, Lessee shall
provide from time to time Lessor with evidence of all such payments referenced
in the foregoing sentence. Lessee shall be entitled to receive any credit or
refund with respect to any Imposition or utility charge paid by Lessee. Unless
an Event of Default shall have occurred and be continuing, the amount of any
credit or refund received by Lessor on account of any Imposition or utility
charge paid by Lessee, net of the costs and expenses incurred by Lessor in
obtaining such credit or refund, shall be promptly paid over to Lessee. All
charges for Impositions or utilities imposed with respect to any Property for a
period during which this Lease expires or terminates shall be adjusted and
prorated on a daily basis between Lessor and Lessee, and each party shall pay
or reimburse the other for such party's pro rata share thereof.
ARTICLE V
5.1 QUIET ENJOYMENT.
Subject to the rights of Lessor contained in Sections 17.2, 17.3
and 20.3 and the other terms of this Lease and the other Operative Agreements
and so long as no Event of Default shall have occurred and be continuing,
Lessee shall peaceably and quietly have, hold and enjoy each Property (or, if
applicable, its subleasehold interest in such Property) for the applicable
Term, free of any claim or other action by Lessor or anyone rightfully claiming
by, through or under Lessor (other than Lessee) with respect to any matters
arising from and after the applicable Commencement Date.
ARTICLE VI
6.1 NET LEASE.
This Lease shall constitute a net lease, and the obligations of
Lessee hereunder are absolute and unconditional. Lessee shall pay all operating
expenses arising out of the use, operation and/or occupancy of each Property
whether arising hereunder, under a Head Lease or otherwise. Any present or
future law to the contrary notwithstanding, this Lease shall not terminate, nor
shall Lessee be entitled to any abatement, suspension, deferment, reduction,
setoff, counterclaim, or defense with respect to the Rent, nor shall the
obligations of Lessee hereunder be affected (except as expressly herein
permitted and by performance of the obligations in connection therewith) for
any reason whatsoever, including without limitation by reason of: (a)
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any damage to or destruction of any Property or any part thereof; (b) any
taking of any Property or any part thereof or interest therein by Condemnation
or otherwise; (c) any prohibition, limitation, restriction or prevention of
Lessee's use, occupancy or enjoyment of any Property or any part thereof, or
any interference with such use, occupancy or enjoyment by any Person or for any
other reason; (d) any title defect, Lien or any matter affecting title to any
Property (whether related to the interest of a Development Authority, the
interest therein purported to be created by a Head Lease or otherwise); (e)
any eviction by paramount title or otherwise; (f) any default by Lessor
hereunder; (g) any action for bankruptcy, insolvency, reorganization,
liquidation, dissolution or other proceeding relating to or affecting the Bank,
Lessor, Lessee or any Governmental Authority; (h) the impossibility or
illegality of performance by Lessor, Lessee or both; (i) any action of any
Governmental Authority or any other Person; (j) Lessee's acquisition of
ownership of all or part of any Property; (k) breach of any warranty or
representation with respect to any Property or any Operative Agreement; (l) any
defect in the condition, quality or fitness for use of any Property or any part
thereof; (m) any default under any Head Lease or any other circumstance arising
under or related to any Head Lease or any other Bond Document (including
without limitation the lack of validity or enforceability of any provision
thereof); or (n) any other cause or circumstance whether similar or dissimilar
to the foregoing and whether or not Lessee shall have notice or knowledge of
any of the foregoing. The parties intend that the obligations of Lessee
hereunder shall be covenants, agreements and obligations that are separate and
independent from any obligations of Lessor hereunder or under any Head Lease
and shall continue unaffected unless such covenants, agreements and obligations
shall have been modified or terminated in accordance with an express provision
of this Lease. Lessee acknowledges that, to the extent any Head Lease imposes
burdens, restrictions or obligations in excess of or in addition to Lessee's
obligations hereunder, Lessee agrees, in addition to Lessee's obligations
hereunder, that Lessee shall perform, satisfy and comply with such burdens,
restrictions and obligations. Lessor and Lessee acknowledge and agree that the
provisions of this Section 6.1 have been specifically reviewed and subject to
negotiation.
6.2 NO TERMINATION OR ABATEMENT.
Lessee shall remain obligated under this Lease in accordance
with its terms and shall not take any action to terminate, rescind or avoid
this Lease, notwithstanding any action for bankruptcy, insolvency,
reorganization, liquidation, dissolution, or other proceeding affecting any
Person or any Governmental Authority, or any action with respect to this Lease
or any Operative Agreement which may be taken by any trustee, receiver or
liquidator of any Person or any Governmental Authority or by any court with
respect to any Person, or any Governmental Authority. Lessee hereby waives all
right (a) to terminate or surrender this Lease (except as permitted under the
terms of the Operative Agreements) or (b) to avail itself of any abatement,
suspension, deferment, reduction, setoff, counterclaim or defense with respect
to any Rent. Lessee shall remain obligated under this Lease in accordance with
its terms and Lessee hereby waives any and all rights now or hereafter
conferred by statute or otherwise to modify or to avoid strict compliance with
its obligations under this Lease. Notwithstanding any such statute or
otherwise, Lessee shall be bound by all of the terms and conditions contained
in this Lease.
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ARTICLE VII
7.1 OWNERSHIP OF THE PROPERTIES.
(a) Lessor and Lessee intend that (i) for financial accounting
purposes with respect to Lessee (A) this Lease will be treated as an
"operating lease" pursuant to Statement of Financial Accounting
Standards No. 13, as amended, (B) Lessor will be treated as the owner
and lessor of each Property and (C) Lessee will be treated as the
lessee of each Property, but (ii) for federal and all state and local
income tax purposes, bankruptcy purposes, regulatory purposes,
commercial law and real estate purposes and all other purposes (A)
this Lease will be treated as a financing arrangement and (B) Lessee
will be treated as the owner of the Properties and will be entitled to
all tax benefits ordinarily available to owners of property similar to
the Properties for such tax purposes. Notwithstanding the foregoing,
neither party hereto has made, or shall be deemed to have made, any
representation or warranty as to the availability of any of the
foregoing treatments under applicable accounting rules, tax,
bankruptcy, regulatory, commercial or real estate law or under any
other set of rules. Lessee shall claim the cost recovery deductions
associated with each Property, and Lessor shall not, to the extent not
prohibited by Law, take on its tax return a position inconsistent with
Lessee's claim of such deductions.
(b) For all purposes other than as set forth in Section
7.1(a)(i), Lessor and Lessee intend this Lease to constitute a finance
lease and not a true lease. In order to secure the obligations of
Lessee now existing or hereafter arising under any and all Operative
Agreements, Lessee hereby conveys, grants, assigns, transfers,
hypothecates, mortgages and sets over to Lessor, for the benefit of
all Financing Parties, a first priority security interest (but subject
to the security interest in the assets granted by Lessee in favor of
the Bank in accordance with the Security Agreement) in and lien on all
right, title and interest of Lessee (now owned or hereafter acquired)
in and to all Properties, to the extent such is personal property and
irrevocably grants and conveys a lien, deed of trust and mortgage on
all right, title and interest of Lessee (now owned or hereafter
acquired) in and to all Properties to the extent such is real
property. Lessor and Lessee further intend and agree that, for the
purpose of securing the obligations of Lessee and/or the Construction
Agent now existing or hereafter arising under the Operative
Agreements, (i) this Lease shall be a security agreement and financing
statement within the meaning of Article 9 of the Uniform Commercial
Code respecting each of the Properties and all proceeds (including
without limitation insurance proceeds thereof) to the extent such is
personal property and an irrevocable grant and conveyance of a lien,
deed of trust and mortgage on each of the Properties and all proceeds
(including without limitation insurance proceeds thereof) to the
extent such is real property; (ii) the acquisition of title by Lessor
(or to the extent applicable, a leasehold interest pursuant to a
Ground Lease or a Head Lease) in each Property referenced in Article
II constitutes a grant by Lessee to Lessor of a security interest,
lien, deed of trust and mortgage in all of Lessee's right, title and
interest in and to each Property and all proceeds (including without
limitation insurance proceeds thereof) of the conversion, voluntary or
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involuntary, of the foregoing into cash, investments, securities or
other property, whether in the form of cash, investments, securities
or other property, and an assignment of all rents, profits and income
produced by each Property; and (iii) notifications to Persons holding
such property, and acknowledgments, receipts or confirmations from
financial intermediaries, bankers or agents (as applicable) of Lessee
shall be deemed to have been given for the purpose of perfecting such
lien, security interest, mortgage lien and deed of trust under
applicable law. Lessee shall promptly take such actions as Lessor may
reasonably request (including without limitation the filing of Uniform
Commercial Code Financing Statements, Uniform Commercial Code Fixture
Filings and memoranda (or short forms) of this Lease and the various
Lease Supplements) to ensure that the lien, security interest, lien,
mortgage lien and deed of trust in each Property and the other items
referenced above will be deemed to be a perfected lien, security
interest, mortgage lien and deed of trust of first priority under
applicable law and will be maintained as such throughout the Term.
ARTICLE VIII
8.1 CONDITION OF THE PROPERTIES.
LESSEE ACKNOWLEDGES AND AGREES THAT IT IS LEASING EACH PROPERTY
"AS-IS WHERE-IS" WITHOUT REPRESENTATION, WARRANTY OR COVENANT (EXPRESS OR
IMPLIED) BY LESSOR (EXCEPT THAT LESSOR SHALL KEEP EACH PROPERTY FREE AND CLEAR
OF LESSOR LIENS) AND IN EACH CASE SUBJECT TO (A) THE EXISTING STATE OF TITLE,
INCLUDING WITHOUT LIMITATION ANY HEAD LEASE FROM A DEVELOPMENT AUTHORITY TO THE
LESSOR, (B) THE RIGHTS OF ANY PARTIES IN POSSESSION THEREOF (IF ANY), (C) ANY
STATE OF FACTS REGARDING ITS PHYSICAL CONDITION OR WHICH AN ACCURATE SURVEY
MIGHT SHOW, (D) ALL APPLICABLE LEGAL REQUIREMENTS AND (E) VIOLATIONS OF LEGAL
REQUIREMENTS WHICH MAY EXIST ON THE DATE HEREOF AND/OR THE DATE OF THE
APPLICABLE LEASE SUPPLEMENT. NONE OF LESSOR, ANY DEVELOPMENT AUTHORITY OR THE
BANK HAS MADE OR SHALL BE DEEMED TO HAVE MADE ANY REPRESENTATION, WARRANTY OR
COVENANT (EXPRESS OR IMPLIED) (EXCEPT THAT LESSOR SHALL KEEP EACH PROPERTY FREE
AND CLEAR OF LESSOR LIENS) OR SHALL BE DEEMED TO HAVE ANY LIABILITY WHATSOEVER
AS TO THE TITLE, VALUE, HABITABILITY, USE, CONDITION, DESIGN, OPERATION,
MERCHANTABILITY OR FITNESS FOR USE OF ANY PROPERTY (OR ANY PART THEREOF), OR
ANY OTHER REPRESENTATION, WARRANTY OR COVENANT WHATSOEVER, EXPRESS OR IMPLIED,
WITH RESPECT TO ANY PROPERTY (OR ANY PART THEREOF), AND NONE OF LESSOR, ANY
DEVELOPMENT AUTHORITY OR THE BANK SHALL BE LIABLE FOR ANY LATENT, HIDDEN, OR
PATENT DEFECT THEREON OR THE FAILURE OF ANY PROPERTY, OR ANY PART THEREOF, TO
COMPLY WITH ANY LEGAL REQUIREMENT. LESSEE HAS OR PRIOR TO THE BASIC TERM
COMMENCEMENT DATE WILL HAVE BEEN AFFORDED FULL OPPORTUNITY TO INSPECT EACH
PROPERTY AND THE
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IMPROVEMENTS THEREON (IF ANY), IS OR WILL BE (INSOFAR AS LESSOR, THE
DEVELOPMENT AUTHORITY AND THE BANK ARE CONCERNED) SATISFIED WITH THE RESULTS OF
ITS INSPECTIONS AND IS ENTERING INTO THIS LEASE SOLELY ON THE BASIS OF THE
RESULTS OF ITS OWN INSPECTIONS, AND ALL RISKS INCIDENT TO THE MATTERS DESCRIBED
IN THE PRECEDING SENTENCE, AS BETWEEN LESSOR, THE DEVELOPMENT AUTHORITY AND THE
BANK, ON THE ONE (1) HAND, AND LESSEE, ON THE OTHER HAND, ARE TO BE BORNE BY
LESSEE.
8.2 POSSESSION AND USE OF THE PROPERTIES.
(a) At all times during the Term with respect to each Property,
such Property shall be a Permitted Facility and shall be used by
Lessee in the ordinary course of its business. Lessee shall pay, or
cause to be paid, all charges and costs required in connection with
the use of the Properties as contemplated by this Lease. Lessee shall
not commit or permit any waste of the Properties or any part thereof.
(b) The address stated in Section 29.1 of this Lease is the
principal place of business and chief executive office of Lessee (as
such terms are used in Section 9-103(3) of the Uniform Commercial Code
of any applicable jurisdiction), and Lessee will provide Lessor with
prior written notice of any change of location of its principal place
of business or chief executive office. Regarding a particular
Property, each Lease Supplement correctly identifies the initial
location of the related Equipment (if any) and Improvements (if any)
and contains an accurate legal description for the related parcel of
Land or a copy of the Ground Lease (if any). The Equipment and
Improvements respecting each particular Property will be located only
at the location identified in the applicable Lease Supplement.
(c) Lessee will not attach or incorporate any item of Equipment
to or in any other item of equipment or personal property or to or in
any real property in a manner that could give rise to the assertion of
any Lien on such item of Equipment by reason of such attachment or the
assertion of a claim that such item of Equipment has become a fixture
and is subject to a Lien in favor of a third party that is prior to
the Liens thereon created by the Operative Agreements.
(d) On the Commencement Date for each Property, Lessor and
Lessee shall execute a Lease Supplement in regard to such Property
which shall contain an Equipment Schedule that has a general
description of the Equipment which shall comprise the Property, an
Improvement Schedule that has a general description of the
Improvements which shall comprise the Property and a legal description
of the Land to be leased hereunder (or in the case of any Property
subject to a Ground Lease or a Head Lease to be subleased hereunder)
as of such date. Each Property subject to a Ground Lease or a Head
Lease shall be deemed to be subleased from Lessor to Lessee as of the
Commencement Date, and such sublease shall be in effect until this
Lease is terminated or expires, in each case in accordance with the
terms and provisions hereof. Lessee shall satisfy and perform all
obligations imposed on Lessor under each Ground Lease or Head Lease.
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Simultaneously with the execution and delivery of each Lease
Supplement, such Equipment, Improvements, Land, subleasehold interest,
all additional Equipment and all additional Improvements which are
financed under the Operative Agreements after the Commencement Date
and the remainder of such Property shall be deemed to have been
accepted by Lessee for all purposes of this Lease and to be subject to
this Lease.
(e) At all times during the Term with respect to each Property,
Lessee will comply with all obligations under and (to the extent no
Event of Default exists and provided that such exercise will not
impair the value, utility or remaining useful life of such Property)
shall be permitted to exercise all rights and remedies under, all
operation and easement agreements and related or similar agreements
applicable to such Property.
8.3 INTEGRATED PROPERTIES.
On the Rent Commencement Date for each Property, Lessee shall,
at its sole cost and expense, cause such Property and the applicable property
subject to a Ground Lease or a Head Lease to constitute (and for the duration
of the Term shall continue to constitute) all of the equipment, facilities,
rights, other personal property and other real property necessary or
appropriate to operate, utilize, maintain and control a Permitted Facility in a
commercially reasonable manner.
ARTICLE IX
9.1 COMPLIANCE WITH LEGAL REQUIREMENTS, INSURANCE REQUIREMENTS AND
MANUFACTURER'S SPECIFICATIONS AND STANDARDS.
Subject to the terms of Article XIII relating to permitted
contests, Lessee, at its sole cost and expense, shall (a) comply with all
applicable Legal Requirements (including without limitation all Environmental
Laws) and all Insurance Requirements relating to the Properties, (b) procure,
maintain and comply with all licenses, permits, orders, approvals, consents and
other authorizations required for the acquisition, installation, testing, use,
development, construction, operation, maintenance, repair, refurbishment and
restoration of the Properties, and (c) comply with all manufacturer's
specifications and standards, including without limitation the acquisition,
installation, testing, use, development, construction, operation, maintenance,
repair, refurbishment and restoration of the Properties, whether or not
compliance therewith shall require structural or extraordinary changes in any
Property or interfere with the use and enjoyment of any Property unless the
failure to procure, maintain and comply with such items identified in
subparagraphs (b) and (c), individually or in the aggregate, shall not and
could not reasonably be expected to have a Material Adverse Effect. In
addition, Lessee agrees to take such action as is required to cause Lessor to
comply with each and every provision of each Head Lease including, if
applicable, any tax-exempt covenants relating to the Properties. Lessor agrees
to take such actions as may be reasonably requested by Lessee in connection
with the compliance by Lessee of its obligations under this Section 9.1.
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ARTICLE X
10.1 MAINTENANCE AND REPAIR; RETURN.
(a) Lessee, at its sole cost and expense, shall maintain each
Property in good condition, repair and working order (ordinary wear
and tear excepted) and in the repair and condition as when originally
delivered to Lessor and make all necessary repairs thereto and
replacements thereof, of every kind and nature whatsoever, whether
interior or exterior, ordinary or extraordinary, structural or
nonstructural or foreseen or unforeseen, in each case as required by
Section 9.1 and on a basis consistent with the operation and
maintenance of properties or equipment comparable in type and function
to the applicable Property, such that such Property is capable of
being immediately utilized by a third party and in compliance with
standard industry practice subject, however, to the provisions of
Article XV with respect to Casualty and Condemnation.
(b) Lessee shall not move or relocate any component of any
Property beyond the boundaries of the Land (comprising part of such
Property) described in the applicable Lease Supplement, except for the
temporary removal of Equipment and other personal property for repair
or replacement.
(c) If any component of any Property becomes worn out, lost,
destroyed, damaged beyond repair or otherwise permanently rendered
unfit for use, Lessee, at its own expense, will within a reasonable
time replace such component with a replacement component which is free
and clear of all Liens (other than Permitted Liens and Lessor Liens)
and has a value, utility and useful life at least equal to the
component replaced (assuming the component replaced had been
maintained and repaired in accordance with the requirements of this
Lease). All components which are added to any Property shall
immediately become the property of (and title thereto shall vest in)
Lessor or, with respect to any Property subject to a Head Lease, the
applicable Development Authority and shall be deemed incorporated in
such Property and subject to the terms of the applicable Head Lease
and/or this Lease as if originally leased thereunder and/or hereunder.
(d) Upon reasonable advance notice, Lessor and its agents shall
have the right to inspect each Property and all maintenance records
with respect thereto at any reasonable time during normal business
hours but shall not, in the absence of an Event of Default, materially
disrupt the business of Lessee.
(e) Lessee shall cause to be delivered to Lessor (at Lessee's
sole expense) one (1) or more reappraisals of Property as Lessor may
request if any one (1) of Lessor, the Trust Company or the Bank is
required pursuant to any applicable Legal Requirement to obtain such
reappraisals.
(f) Lessor shall under no circumstances be required to build any
improvements or install any equipment on any Property, make any
repairs, replacements,
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alterations or renewals of any nature or description to any Property,
make any expenditure whatsoever in connection with this Lease or
maintain any Property in any way. Lessor shall not be required to
maintain, repair or rebuild all or any part of any Property, and
Lessee waives the right to (i) require Lessor to maintain, repair, or
rebuild all or any part of any Property, or (ii) make repairs at the
expense of Lessor pursuant to any Legal Requirement, Insurance
Requirement, contract, agreement, covenant, condition or restriction
at any time in effect.
(g) Lessee shall, upon the expiration or earlier termination of
this Lease with respect to a Property, if Lessee shall not have
exercised its Purchase Option with respect to such Property (or
Lessor's leasehold interest therein, as the case may be) and purchased
such Property (or Lessor's leasehold interest therein, as the case may
be), surrender such Property (i) to Lessor pursuant to the exercise of
the applicable remedies upon the occurrence of a Lease Event of
Default or (ii) pursuant to the second paragraph of Section 22.1(a)
hereof, to Lessor or the third party purchaser, as the case may be,
subject to Lessee's obligations under this Lease (including without
limitation the obligations of Lessee at the time of such surrender
under Sections 9.1, 10.1(a) through (f), 10.2, 11.1, 12.1, 22.1 and
23.1).
10.2 ENVIRONMENTAL INSPECTION.
If Lessee has not given notice of exercise of its Purchase
Option on the Expiration Date pursuant to Section 20.1 or for whatever reason
Lessee does not purchase a Property in accordance with the terms of this Lease,
then not more than one hundred twenty (120) days nor less than sixty (60) days
prior to the Expiration Date, Lessee at its expense shall cause to be delivered
to Lessor a Phase I environmental site assessment recently prepared (no more
than thirty (30) days prior to the date of delivery) by an independent
recognized professional reasonably acceptable to Lessor, and in form, scope and
content reasonably satisfactory to Lessor.
ARTICLE XI
11.1 MODIFICATIONS.
(a) Lessee at its sole cost and expense, at any time and from
time to time without the consent of Lessor may make modifications,
alterations, renovations, improvements and additions to any Property
or any part thereof and substitutions and replacements therefor
(collectively, "Modifications"), and Lessee shall make any and all
Modifications required to be made pursuant to all Legal Requirements,
Insurance Requirements and manufacturer's specifications and
standards; provided, that: (i) no Modification shall materially impair
the value, utility or useful life of any Property from that which
existed immediately prior to such Modification; (ii) each Modification
shall be done expeditiously and in a good and workmanlike manner;
(iii) no Modification shall adversely affect the structural integrity
of any Property; (iv) to the extent required by
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Section 14.2(a), Lessee shall maintain builders' risk insurance at all
times when a Modification is in progress; (v) subject to the terms of
Article XIII relating to permitted contests, Lessee shall pay all
costs and expenses and discharge any Liens arising with respect to any
Modification; (vi) each Modification shall comply with the
requirements of this Lease (including without limitation Sections 8.2
and 10.1); and (vii) no Improvement shall be demolished or otherwise
rendered unfit for use unless Lessee shall finance the proposed
replacement Modification outside of this lease facility; provided,
further, Lessee shall not make any Modification (unless required by
any Legal Requirement) to the extent any such Modification,
individually or in the aggregate, shall or could reasonably be
expected to have a Material Adverse Effect. All Modifications shall
immediately and without further action upon their incorporation into
the applicable Property (1) become property of Lessor or, with respect
to any Property subject to a Head Lease, the applicable Development
Authority, (2) be subject to the applicable Head Lease, if any, and
this Lease and (3) be titled in the name of Lessor or, with respect to
any Property subject to a Head Lease, the applicable Development
Authority. Lessee shall not remove or attempt to remove any
Modification from any Property. Each Ground Lease for a Property shall
expressly provide for the provisions of the foregoing sentence.
Lessee, at its own cost and expense, will pay for the repairs of any
damage to any Property caused by the removal or attempted removal of
any Modification.
(b) The construction process provided for in the Agency
Agreement is acknowledged by Lessor to be consistent with and in
compliance with the terms and provisions of this Article XI.
ARTICLE XII
12.1 WARRANTY OF TITLE.
(a) Lessee hereby acknowledges and shall cause title in each
Property (including without limitation all Equipment, all
Improvements, all replacement components to each Property and all
Modifications) immediately and without further action to vest in and
become the property of Lessor and to be subject to the terms of this
Lease (provided, respecting each Property subject to a Ground Lease or
Head Lease, Lessor's interest therein is acknowledged to be a
leasehold interest pursuant to such Ground Lease or Head Lease) from
and after the date hereof or such date of incorporation into any
Property. Lessee agrees that, subject to the terms of Article XIII
relating to permitted contests, Lessee shall not directly or
indirectly create or allow to remain, and shall promptly discharge at
its sole cost and expense, any Lien, defect, attachment, levy, title
retention agreement or claim upon any Property, any component thereof
or any Modifications or any Lien, attachment, levy or claim with
respect to the Rent or with respect to any amounts held by Lessor or
the Bank pursuant to any Operative Agreement, other than Permitted
Liens and Lessor Liens. Lessee shall promptly notify Lessor in the
event it receives actual knowledge that a Lien other than a Permitted
Lien or Lessor Lien has occurred with respect to a Property, the Rent
or any other such amounts, and Lessee
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represents and warrants to, and covenants with, Lessor that the Liens
in favor of Lessor and/or the Bank created by the Operative Agreements
are (and until the Financing Parties under the Operative Agreements
have been paid in full shall remain) first priority perfected Liens
subject only to Permitted Liens and Lessor Liens. At all times
subsequent to the Commencement Date respecting a Property, Lessee
shall (i) cause a valid, perfected, first priority Lien on each
applicable Property to be in place in favor of the Bank and (ii) file,
or cause to be filed, all necessary documents under the applicable
real property law and Article 9 of the Uniform Commercial Code to
perfect such title and Liens.
(b) Nothing contained in this Lease shall be construed as
constituting the consent or request of any Development Authority or
the Lessor, expressed or implied, to or for the performance by any
contractor, mechanic, laborer, materialman, supplier or vendor of any
labor or services or for the furnishing of any materials for any
construction, alteration, addition, repair or demolition of or to any
Property or any part thereof. NOTICE IS HEREBY GIVEN THAT NONE OF ANY
DEVELOPMENT AUTHORITY OR THE LESSOR IS OR SHALL BE LIABLE FOR ANY
LABOR, SERVICES OR MATERIALS FURNISHED OR TO BE FURNISHED TO LESSEE,
OR TO ANYONE HOLDING A PROPERTY OR ANY PART THEREOF THROUGH OR UNDER
LESSEE, AND THAT NO MECHANIC'S OR OTHER LIENS FOR ANY SUCH LABOR,
SERVICES OR MATERIALS SHALL ATTACH TO OR AFFECT THE INTEREST OF ANY
DEVELOPMENT AUTHORITY OR LESSOR IN AND TO ANY PROPERTY.
ARTICLE XIII
13.1 PERMITTED CONTESTS OTHER THAN IN RESPECT OF INDEMNITIES.
Except to the extent otherwise provided for in Section 11 of the
Participation Agreement, Lessee, on its own or on Lessor's or any Development
Authority's behalf, as the case may be, but at Lessee's sole cost and expense,
may contest, by appropriate administrative or judicial proceedings conducted in
good faith and with due diligence, the amount, validity or application, in
whole or in part, of any Legal Requirement, Imposition or utility charge
payable pursuant to Section 4.1 or any Lien, attachment, levy, encumbrance or
encroachment, and Lessor agrees not to pay, settle or otherwise compromise any
such item, provided, that (a) the commencement and continuation of such
proceedings shall suspend the collection of any such contested amount from, and
suspend the enforcement thereof against, the applicable Properties, the
applicable Development Authority, Lessor and the Bank; (b) there shall not be
imposed a Lien (other than Permitted Liens and Lessor Liens) on any Property
and no part of any Property nor any Rent (or amount due under any Head Lease or
with respect to any Bonds) would be in any danger of being sold, forfeited,
lost or deferred; (c) at no time during the permitted contest shall there be a
risk of the imposition of criminal liability or material civil liability on the
Development Authority, the Lessor or the Bank for failure to comply therewith;
and (d) in the event that, at any time, there shall be a material risk of
extending the application of such item
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beyond the end of the Term, then Lessee shall deliver to Lessor an Officer's
Certificate certifying as to the matters set forth in clauses (a), (b) and (c)
of this Section 13.1. Lessor, at Lessee's sole cost and expense, shall execute
and deliver to Lessee such authorizations and other documents as may reasonably
be required in connection with any such contest and, if reasonably requested by
Lessee, shall join as a party therein at Lessee's sole cost and expense.
13.2 IMPOSITIONS, UTILITY CHARGES, OTHER MATTERS; COMPLIANCE WITH
LEGAL REQUIREMENTS.
Except with respect to Impositions, Legal Requirements, utility
charges and such other matters referenced in Section 13.1 which are the subject
of ongoing proceedings contesting the same in a manner consistent with the
requirements of Section 13.1, Lessee shall cause (a) all Impositions, utility
charges and such other matters to be timely paid, settled or compromised, as
appropriate, with respect to each Property and (b) each Property to comply with
all applicable Legal Requirements.
ARTICLE XIV
14.1 PUBLIC LIABILITY AND WORKERS' COMPENSATION INSURANCE.
During the Term for each Property, Lessee shall procure and
carry, at Lessee's sole cost and expense, commercial general liability and
umbrella liability insurance for claims for injuries or death sustained by
persons or damage to property while on such Property or respecting the
Equipment and such other public liability coverages as are then customarily
carried by similarly situated companies conducting business similar to that
conducted by Lessee. Such insurance shall be on terms and in amounts that are
no less favorable than insurance maintained by Lessee with respect to similar
properties and equipment that it owns and are then carried by similarly
situated companies conducting business similar to that conducted by Lessee, and
in no event shall have a minimum combined single limit per occurrence coverage
(i) for commercial general liability of less than $5,000,000 and (ii) for
umbrella liability of less than $25,000,000. The policies shall name Lessee as
the insured and shall be endorsed to name the applicable Development Authority
(if any), the applicable Bond Trustee (if any), the Lessor and the Bank as
additional insureds. The policies shall also specifically provide that such
policies shall be considered primary insurance which shall apply to any loss or
claim before any contribution by any insurance which the applicable Development
Authority (if any), the applicable Bond Trustee (if any), the Lessor or the
Bank may have in force. In the operation of the Properties, Lessee shall comply
with applicable workers' compensation laws and protect the applicable
Development Authority (if any), the applicable Bond Trustee (if any), the
Lessor and the Bank against any liability under such laws.
14.2 PERMANENT HAZARD AND OTHER INSURANCE.
(a) During the Term for each Property, Lessee shall keep such
Property insured against all risk of physical loss or damage by fire
and other risks and shall
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maintain builders' risk insurance during construction of any
Improvements or Modifications in each case in amounts no less than
the then current replacement value of such Property (assuming that
such Property was in the condition required by the terms of this Lease
immediately prior to such loss) and on terms that (i) are no less
favorable than insurance covering other similar properties owned by
Lessee and (ii) are then carried by similarly situated companies
conducting business similar to that conducted by Lessee. The policies
shall name Lessee as the insured and shall be endorsed to name each of
Lessor and the Bank (and, respecting any particular Property, each
other party as may be required under the terms of any Head Lease with
respect to such Property) as an additional insured and as a loss
payee, to the extent of their respective interests; provided, so long
as no Event of Default exists, any loss payable under the insurance
policies required by this Section for losses up to $1,000,000 will be
paid to Lessee.
(b) If, during the Term with respect to a Property the area in
which such Property is located is designated a "flood-prone" area
pursuant to the Flood Disaster Protection Act of 1973, or any
amendments or supplements thereto or is in a zone designated A or V,
then Lessee shall comply with the National Flood Insurance Program as
set forth in the Flood Disaster Protection Act of 1973. In addition,
Lessee will fully comply with the requirements of the National Flood
Insurance Act of 1968 and the Flood Disaster Protection Act of 1973,
as each may be amended from time to time, and with any other Legal
Requirement, concerning flood insurance to the extent that it applies
to any such Property. During the Term, Lessee shall, in the operation
and use of each Property, maintain workers' compensation insurance
consistent with that carried by similarly situated companies
conducting business similar to that conducted by Lessee and containing
minimum liability limits of no less than $100,000. In the operation of
each Property, Lessee shall comply with workers' compensation laws
applicable to Lessee, and protect the applicable Development Authority
(if any), the applicable Bond Trustee (if any), the Lessor and the
Bank against any liability under such laws.
14.3 COVERAGE.
(a) As of the date of this Lease and annually thereafter during
the Term, Lessee shall furnish the applicable Development Authority
(if any), the applicable Bond Trustee (if any) and the Bank (on behalf
of Lessor) with certificates prepared by the insurers or insurance
broker of Lessee showing the insurance required under Sections 14.1
and 14.2 to be in effect, naming (to the extent of their respective
interests) Lessor and the Bank as additional insureds and loss payees
and evidencing the other requirements of this Article XIV. All such
insurance shall be at the cost and expense of Lessee and provided by
nationally recognized, financially sound insurance companies having an
A or better rating by A.M. Best's Key Rating Guide. Lessee shall cause
such certificates to include a provision for thirty (30) days' advance
written notice by the insurer to the applicable Development Authority
(if any), the applicable Bond Trustee (if any) and the Bank (on behalf
of Lessor) in the event of cancellation or material alteration of such
insurance. If an Event of Default has occurred and is continuing and
the Bank
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(on behalf of Lessor) so requests, Lessee shall deliver to the Bank
(on behalf of Lessor) copies of all insurance policies required by
Sections 14.1 and 14.2.
(b) Lessee agrees that the insurance policy or policies required
by Sections 14.1, 14.2(a) and 14.2(b) shall include an appropriate
clause pursuant to which any such policy shall provide that it will
not be invalidated should Lessee or any Contractor, as the case may
be, waive, at any time, any or all rights of recovery against any
party for losses covered by such policy or due to any breach of
warranty, fraud, action, inaction or misrepresentation by Lessee or
any Person acting on behalf of Lessee. Lessee hereby waives any and
all such rights against the applicable Development Authority (if any),
the applicable Bond Trustee (if any), the Lessor and the Bank to the
extent of payments made to any such Person under any such policy.
(c) Neither Lessor nor Lessee shall carry separate insurance
concurrent in kind or form or contributing in the event of loss with
any insurance required under this Article XIV, except that Lessor may
carry separate liability insurance at Lessor's sole cost so long as
(i) Lessee's insurance is designated as primary and in no event excess
or contributory to any insurance Lessor may have in force which would
apply to a loss covered under Lessee's policy and (ii) each such
insurance policy will not cause Lessee's insurance required under this
Article XIV to be subject to a coinsurance exception of any kind.
(d) Lessee shall pay as they become due all premiums for the
insurance required by Section 14.1 and Section 14.2, shall renew or
replace each policy prior to the expiration date thereof or otherwise
maintain the coverage required by such Sections without any lapse in
coverage.
ARTICLE XV
15.1 CASUALTY AND CONDEMNATION.
(a) Subject to the provisions of the Agency Agreement and this
Article XV and Article XVI (in the event Lessee delivers, or is
obligated to deliver or is deemed to have delivered, a Termination
Notice) and except as otherwise provided in any applicable Bond
Document (including without limitation any Head Lease), and prior to
the occurrence and continuation of a Default or an Event of Default,
Lessee shall be entitled to receive (and Lessor hereby irrevocably
assigns to Lessee all of Lessor's right, title and interest in) any
condemnation proceeds, award, compensation or insurance proceeds under
Sections 14.2(a) or 14.2(b) hereof to which Lessee or Lessor may
become entitled by reason of their respective interests in a Property
(i) if all or a portion of such Property is damaged or destroyed in
whole or in part by a Casualty or (ii) if the use, access, occupancy,
easement rights or title to such Property or any part thereof is the
subject of a Condemnation; provided, however, if a Default or an Event
of Default shall have occurred and be continuing or if such award,
compensation or insurance proceeds shall
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exceed $1,000,000, then such award, compensation or insurance proceeds
shall be paid directly to Lessor or, if received by Lessee, shall be
held in trust for Lessor, and shall be paid over by Lessee to Lessor
and held in accordance with the terms of this paragraph (a). All
amounts held by Lessor hereunder on account of any award, compensation
or insurance proceeds either paid directly to Lessor or turned over to
Lessor shall be held as security for the performance of Lessee's
obligations hereunder and under the other Operative Agreements and
when all such obligations of Lessee with respect to such matters (and
all other obligations of Lessee which should have been satisfied
pursuant to the Operative Agreements as of such date) have been
satisfied, all amounts so held by Lessor shall be paid over to Lessee.
(b) Lessee may appear in any proceeding or action to negotiate,
prosecute, adjust or appeal any claim for any award, compensation or
insurance payment on account of any such Casualty or Condemnation and
shall pay all expenses thereof. At Lessee's reasonable request, and at
Lessee's sole cost and expense, Lessor and the Bank shall participate
in any such proceeding, action, negotiation, prosecution or
adjustment. Lessor and Lessee agree that this Lease shall control the
rights of Lessor and Lessee in and to any such award, compensation or
insurance payment.
(c) If Lessee shall receive notice of a Casualty or a
Condemnation of a Property or any interest therein where damage to the
affected Property is estimated to equal or exceed twenty-five percent
(25%) of the Property Cost of such Property (or where such claim is
estimated to exceed twenty-five percent (25%) of "Project Costs",
"Costs of the Project" or other similar term used in any Head Lease),
Lessee shall give notice thereof to Lessor promptly after Lessee's
receipt of such notice. In the event such a Casualty or Condemnation
occurs (regardless of whether Lessee gives notice thereof), then
Lessee shall be deemed to have delivered a Termination Notice to
Lessor and the provisions of Sections 16.1 and 16.2 shall apply.
(d) In the event of a Casualty or a Condemnation (regardless of
whether notice thereof must be given pursuant to paragraph (c)), this
Lease shall terminate with respect to the applicable Property in
accordance with Section 16.1 if Lessee, within thirty (30) days after
such occurrence, delivers to Lessor a notice to such effect.
(e) If pursuant to this Section 15.1 this Lease shall continue
in full force and effect following a Casualty or Condemnation with
respect to the affected Property, Lessee shall, at its sole cost and
expense (subject to reimbursement in accordance with Section 15.1(a))
promptly and diligently repair any damage to the applicable Property
caused by such Casualty or Condemnation in conformity with the
requirements of Sections 10.1 and 11.1, using the as-built Plans and
Specifications or manufacturer's specifications for the applicable
Improvements, Equipment or other components of the applicable Property
(as modified to give effect to any subsequent Modifications, any
Condemnation affecting the applicable Property and all applicable
Legal Requirements), so as to restore the applicable Property to the
same or a greater remaining economic value, useful life, utility,
condition, operation and function as existed immediately prior
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to such Casualty or Condemnation (assuming all maintenance and repair
standards have been satisfied). In such event, title to the applicable
Property shall remain with Lessor (or with the applicable Development
Authority (if any)) and be subject to this Lease and the applicable
Head Lease (if any).
(f) In no event shall a Casualty or Condemnation affect Lessee's
obligations to pay Rent pursuant to Article III.
(g) Notwithstanding anything to the contrary set forth in
Section 15.1(a) or Section 15.1(e), if during the Term with respect to
a Property a Casualty occurs with respect to such Property or Lessee
receives notice of a Condemnation with respect to such Property, and
following such Casualty or Condemnation, the applicable Property
cannot reasonably be restored, repaired or replaced on or before the
date six (6) months prior to the Expiration Date or the date nine (9)
months after the occurrence of such Casualty or Condemnation (if such
Casualty or Condemnation occurs during the Term) to the same or a
greater remaining economic value, useful life, utility, condition,
operation and function as existed immediately prior to such Casualty
or Condemnation (assuming all maintenance and repair standards have
been satisfied) or on or before such day such Property is not in fact
so restored, repaired or replaced, then Lessee shall be required to
exercise its Purchase Option for such Property on the next Payment
Date (notwithstanding the limits on such exercise contained in Section
20.2) and pay Lessor the Termination Value for such Property;
provided, if any Default or Event of Default has occurred and is
continuing, Lessee shall also promptly (and in any event within three
(3) Business Days) pay Lessor any award, compensation or insurance
proceeds received on account of any Casualty or Condemnation with
respect to any Property; provided, further, that if no Default or
Event of Default has occurred and is continuing, any Excess Proceeds
shall be paid to Lessee. If a Default or an Event of Default has
occurred and is continuing and any Loans, Holder Advances or other
amounts are owing with respect thereto, then any Excess Proceeds (to
the extent of any such Loans, Holder Advances or other amounts owing
with respect thereto) shall be paid to Lessor, held as security for
the performance of Lessee's obligations hereunder and under the other
Operative Agreements and applied to such obligations upon the exercise
of remedies in connection with the occurrence of an Event of Default,
with the remainder of such Excess Proceeds in excess of such Loans,
Holder Advances and other amounts owing with respect thereto being
distributed to the Lessee.
15.2 ENVIRONMENTAL MATTERS.
Promptly upon Lessee's actual knowledge of the presence of
Hazardous Substances in any portion of any Property or Properties in
concentrations and conditions that constitute an Environmental Violation and
which, in the reasonable opinion of Lessee, the cost to undertake any legally
required response, clean up, remedial or other action will or might result in a
cost to Lessee of more than $15,000. Lessee shall notify Lessor in writing of
such condition. In the event of any Environmental Violation (regardless of
whether notice thereof must be given), Lessee shall, not later than thirty (30)
days after Lessee has actual knowledge of such
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Environmental Violation, either deliver to Lessor a Termination Notice with
respect to the applicable Property or Properties pursuant to Section 16.1, if
applicable, or, at Lessee's sole cost and expense, promptly and diligently
undertake and diligently complete any response, clean up, remedial or other
action (including without limitation the pursuit by Lessee of appropriate
action against any off-site or third party source for contamination) necessary
to remove, cleanup or remediate the Environmental Violation in accordance with
all Environmental Laws. Any such undertaking shall be timely completed in
accordance with prudent industry standards. If Lessee does not deliver a
Termination Notice with respect to such Property pursuant to Section 16.1,
Lessee shall, upon completion of remedial action by Lessee, cause to be
prepared by a reputable environmental consultant acceptable to Lessor a report
describing the Environmental Violation and the actions taken by Lessee (or its
agents) in response to such Environmental Violation, and a statement by the
consultant that the Environmental Violation has been remedied in full
compliance with applicable Environmental Law. Not less than sixty (60) days
prior to any time that Lessee elects to cease operations with respect to any
Property or to remarket any Property pursuant to Section 20.1 hereof or any
other provision of any Operative Agreement, Lessee at its expense shall cause
to be delivered to Lessor a Phase I environmental site assessment respecting
such Property recently prepared (no more than thirty (30) days prior to the
date of delivery) by an independent recognized professional acceptable to
Lessor in its reasonable discretion and in form, scope and content satisfactory
to Lessor in its reasonable discretion. Notwithstanding any other provision of
any Operative Agreement, if Lessee fails to comply with the foregoing
obligation regarding the Phase I environmental site assessment, Lessee shall be
obligated to purchase such Property for its Termination Value and shall not be
permitted to exercise (and Lessor shall have no obligation to honor any such
exercise) any rights under any Operative Agreement regarding a sale of such
Property to a Person other than Lessee or any Affiliate of Lessee.
15.3 NOTICE OF ENVIRONMENTAL MATTERS.
Promptly, but in any event within five (5) Business Days from
the date Lessee has actual knowledge thereof, Lessee shall provide to Lessor
written notice of any pending or threatened claim, action or proceeding
involving any Environmental Law or any Release on or in connection with any
Property or Properties. All such notices shall describe in reasonable detail
the nature of the claim, action or proceeding and Lessee's proposed response
thereto. In addition, Lessee shall provide to Lessor, within five (5) Business
Days of receipt, copies of all material written communications with any
Governmental Authority relating to any Environmental Law in connection with any
Property. Lessee shall also promptly provide such detailed reports of any such
material environmental claims as may reasonably be requested by Lessor.
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ARTICLE XVI
16.1 TERMINATION UPON CERTAIN EVENTS.
If Lessee has delivered, or is deemed to have delivered, written
notice of a termination of this Lease with respect to the applicable Property
to Lessor in the form described in Section 16.2(a) (a "Termination Notice")
pursuant to the provisions of this Lease, then following the applicable
Casualty, Condemnation or Environmental Violation, this Lease shall terminate
with respect to the affected Property on the applicable Termination Date.
16.2 PROCEDURES.
(a) A Termination Notice shall contain: (i) notice of
termination of this Lease with respect to the affected Property on a
Payment Date not more than sixty (60) days after Lessor's receipt of
such Termination Notice (the "Termination Date"); and (ii) a binding
and irrevocable agreement of Lessee to pay the Termination Value for
the applicable Property (or, if applicable, for Lessor's leasehold
interest and/or other rights existing under the Head Lease with
respect to such Property) and purchase such Property (or, if
applicable, Lessor's leasehold interest and/or other rights existing
under the Head Lease with respect to such Property) on such
Termination Date.
(b) On each Termination Date, Lessee shall pay to Lessor the
Termination Value for the applicable Property (or, if applicable, for
Lessor's leasehold interest and/or other rights existing under the
Head Lease with respect to such Property), and Lessor shall convey
such Property (or, if applicable, Lessor's leasehold interest and/or
other rights existing under the Head Lease with respect to such
Property) or the remaining portion thereof, if any, to Lessee (or
Lessee's designee), all in accordance with Section 20.2.
ARTICLE XVII
17.1 LEASE EVENTS OF DEFAULT.
If any one (1) or more of the following events (each a "Lease
Event of Default") shall occur:
(a) Lessee shall fail to make payment of (i) any Basic Rent
(except as set forth in clause (ii)) within five (5) Business Days
after the same has become due and payable or (ii) any Termination
Value, on the date any such payment is due and payable, or any payment
of Basic Rent or Supplemental Rent due on the due date of any such
payment of Termination Value, or any amount due on the Expiration
Date;
(b) Lessee shall fail to make payment of any Supplemental Rent
(other than Supplemental Rent referred to in Section 17.1(a)(ii)) or
shall fail to make any payment of
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any amount under any Operative Agreement which has become due and
payable within five (5) Business Days after receipt of notice that
such payment is due;
(c) Lessee shall fail to maintain insurance as required by
Article XIV of this Lease or to deliver any requisite annual
certificate with respect thereto within ten (10) days of the date such
certificate is due under the terms hereof;
(d) (i) Lessee shall fail to observe or perform any term,
covenant, obligation or condition of Lessee under this Lease
(including without limitation the Incorporated Covenants) or any other
Operative Agreement to which Lessee is a party other than those set
forth in Sections 17.1(a), (b) or (c) hereof and such failure shall
continue for fifteen (15) days (or with respect to the Incorporated
Covenants, the grace period, if any, applicable thereto) after notice
thereof to the Lessee, or (ii) any representation or warranty made by
Lessee set forth in this Lease (including without limitation the
Incorporated Representation and Warranties) or in any other Operative
Agreement or in any document entered into in connection herewith or
therewith or in any document, certificate or financial or other
statement delivered in connection herewith or therewith shall be false
or inaccurate in any material way when made;
(e) An Agency Agreement Event of Default shall have occurred and
be continuing;
(f) The Lessee or any Subsidiary of the Lessee shall default
(beyond applicable periods of grace and/or notice and cure) in the
payment when due of any principal of or interest on any Indebtedness
having an outstanding principal amount of at least $5,000,000; or any
other event or condition shall occur which results in a default of any
such Indebtedness or enables the holder of any such Indebtedness or
any Person acting on such holder's behalf to accelerate the maturity
thereof;
(g) The liquidation or dissolution of the Lessee, or the
suspension of the business of the Lessee, or the filing by the Lessee
of a voluntary petition or an answer seeking reorganization,
arrangement, readjustment of its debts or for any other relief under
the United States Bankruptcy Code, as amended, or under any other
insolvency act or law, state or federal, now or hereafter existing, or
any other action of Lessee indicating its consent to, approval of or
acquiescence in, any such petition or proceeding; the application by
Lessee for, or the appointment by consent or acquiescence of Lessee of
a receiver, a trustee or a custodian of Lessee for all or a
substantial part of its property; the making by Lessee of any
assignment for the benefit of creditors; the inability of Lessee or
the admission by Lessee in writing of its inability to pay its debts
as they mature; or Lessee taking any corporate action to authorize any
of the foregoing;
(h) The filing of an involuntary petition against Lessee in
bankruptcy or seeking reorganization, arrangement, readjustment of its
debts or for any other relief under the United States Bankruptcy Code,
as amended, or under any other insolvency act or law, state or federal,
now or hereafter existing; or the involuntary appointment of a
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receiver, a trustee or a custodian of Lessee for all or a substantial
part of its property; or the issuance of a warrant of attachment,
execution or similar process against any substantial part of the
property of Lessee, and the continuance of any of such events for
ninety (90) days undismissed or undischarged;
(i) The adjudication of Lessee as bankrupt or insolvent;
(j) The entering of any order in any proceedings against the
Lessee or any Subsidiary of the Lessee decreeing the dissolution,
divestiture or split-up of the Lessee or any Subsidiary of the Lessee,
and such order remains in effect for more than sixty (60) days;
(k) Any report, certificate, financial statement or other
instrument delivered to Lessor by or on behalf of the Lessee pursuant
to the terms of this Lease or any other Operative Agreement is false
or misleading in any material respect when made or delivered;
(l) Any Lessee Credit Agreement Event of Default shall have
occurred and be continuing and shall not have been waived;
(m) A final judgment or judgments for the payment of money shall
be rendered by a court or courts against the Lessee or any Subsidiary
of the Lessee in excess of $500,000 in the aggregate, and (i) the same
shall not be discharged (or provision shall not be made for such
discharge), or a stay of execution thereof shall not be procured,
within thirty (30) days from the date of entry thereof, or (ii) the
Lessee or any such Subsidiary shall not, within said period of thirty
(30) days, or such longer period during which execution of the same
shall have been stayed, appeal therefrom and cause the execution
thereof to be stayed during such appeal, or (iii) such judgment or
judgments shall not be discharged (or provisions shall not be made for
such discharge) within thirty (30) days after a decision has been
reached with respect to such appeal and the related stay has been
lifted;
(n) The Lessee or any member of the Controlled Group shall fail
to pay when due an amount or amounts aggregating in excess of
$2,000,000 which it shall have become liable to pay to the PBGC or to
a Pension Plan under Title IV of ERISA; or notice of intent to
terminate a Pension Plan or Pension Plans having aggregate Unfunded
Liabilities in excess of $2,000,000 shall be filed under Title IV of
ERISA by the Lessee or any member of the Controlled Group, any plan
administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate or to cause
a trustee to be appointed to administer any such Pension Plan or
Pension Plans or a proceeding shall be instituted by a fiduciary of
any such Pension Plan or Pension Plans against the Lessee or any
member of the Controlled Group to enforce Section 515 or 4219(c)(5) of
ERISA; or a condition shall exist by reason of which the PBGC would be
entitled to obtain a decree adjudicating that any such Pension Plan or
Pension Plans must be terminated;
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(o) (i) As a result of one (1) or more transactions after the
date of this Lease, any "person" or "group" of persons shall have
"beneficial ownership" (within the meaning of Section 13(d) or 14(d)
of the Securities Exchange Act of 1934, as amended, and the applicable
rules and regulations thereunder) other than ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. of twenty percent
(20%) or more of the outstanding common stock of Lessee; or (ii)
without limiting the generality of the foregoing, during any period of
twenty-four (24) consecutive months, commencing after the date of this
Lease, individuals who at the beginning of such period of twenty-four
(24) months were directors of Lessee shall cease for any reason to
constitute a majority of the board of directors of Lessee, provided,
that the relationships among the respective shareholders of Lessee on
the Initial Closing Date shall not be deemed to constitute all or any
combination of them as a "group" for purposes of clause (o)(i);
(p) Any Operative Agreement shall cease to be in full force and
effect; or
(q) Any default shall occur under the Head Lease or any other
Bond Document after the expiration of any express cure or grace
periods;
then, in any such event, Lessor may, in addition to the other rights and
remedies provided for in this Article XVII and in Section 18.1, terminate this
Lease by giving Lessee five (5) days notice of such termination (provided,
notwithstanding the foregoing, this Lease shall be deemed to be automatically
terminated without the giving of notice upon the occurrence of a Lease Event of
Default under Sections 17.1(g), (h) or (i)), and this Lease shall terminate,
and all rights of Lessee under this Lease shall cease. Lessee shall, to the
fullest extent permitted by law, pay as Supplemental Rent all costs and
expenses incurred by or on behalf of Lessor or any other Financing Party,
including without limitation reasonable fees and expenses of counsel, as a
result of any Lease Event of Default hereunder.
A POWER OF SALE HAS BEEN GRANTED IN THIS LEASE. A POWER OF SALE MAY
ALLOW LESSOR TO TAKE THE PROPERTIES AND SELL THE PROPERTIES WITHOUT GOING TO
COURT IN A FORECLOSURE ACTION UPON THE OCCURRENCE OF A LEASE EVENT OF DEFAULT.
17.2 SURRENDER OF POSSESSION.
If a Lease Event of Default shall have occurred and be
continuing, and whether or not this Lease shall have been terminated pursuant
to Section 17.1, Lessee shall, upon thirty (30) days written notice, surrender
to Lessor possession of the Properties. Lessor may enter upon and repossess the
Properties by such means as are available at law or in equity, and may remove
Lessee and all other Persons and any and all personal property and Lessee's
equipment and personalty and severable Modifications from the Properties.
Lessor shall have no liability by reason of any such entry, repossession or
removal performed in accordance with applicable law. Upon the written demand of
Lessor, Lessee shall return the Properties promptly to Lessor, in the
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manner and condition required by, and otherwise in accordance with the
provisions of, Section 22.1(c) hereof.
17.3 RELETTING.
If a Lease Event of Default shall have occurred and be
continuing, and whether or not this Lease shall have been terminated pursuant
to Section 17.1, Lessor may, but shall be under no obligation to, relet any or
all of the Properties, for the account of Lessee or otherwise, for such term or
terms (which may be greater or less than the period which would otherwise have
constituted the balance of the Term) and on such conditions (which may include
concessions or free rent) and for such purposes as Lessor may determine, and
Lessor may collect, receive and retain the rents resulting from such reletting.
Lessor shall not be liable to Lessee for any failure to relet any Property or
for any failure to collect any rent due upon such reletting.
17.4 DAMAGES.
Neither (a) the termination of this Lease as to all or any of
the Properties pursuant to Section 17.1; (b) the repossession of all or any of
the Properties; nor (c) the failure of Lessor to relet all or any of the
Properties, the reletting of all or any portion thereof, nor the failure of
Lessor to collect or receive any rentals due upon any such reletting, shall
relieve Lessee of its liabilities and obligations hereunder, all of which shall
survive any such termination, repossession or reletting. If any Lease Event of
Default shall have occurred and be continuing and notwithstanding any
termination of this Lease pursuant to Section 17.1, Lessee shall forthwith pay
to Lessor all Rent and other sums due and payable hereunder to and including
without limitation the date of such termination. Thereafter, on the days on
which the Basic Rent or Supplemental Rent, as applicable, are payable under
this Lease or would have been payable under this Lease if the same had not been
terminated pursuant to Section 17.1 and until the end of the Term hereof or
what would have been the Term in the absence of such termination, Lessee shall
pay Lessor, as current liquidated damages (it being agreed that it would be
impossible accurately to determine actual damages) an amount equal to the Basic
Rent and Supplemental Rent that are payable under this Lease or would have been
payable by Lessee hereunder if this Lease had not been terminated pursuant to
Section 17.1, less the net proceeds, if any, which are actually received by
Lessor with respect to the period in question of any reletting of any Property
or any portion thereof; provided, that Lessee's obligation to make payments of
Basic Rent and Supplemental Rent under this Section 17.4 shall continue only so
long as Lessor shall not have received the amounts specified in Section 17.6.
In calculating the amount of such net proceeds from reletting, there shall be
deducted all of Lessor's and the Bank's reasonable expenses in connection
therewith, including without limitation repossession costs, brokerage or sales
commissions, fees and expenses for counsel and any necessary repair or
alteration costs and expenses incurred in preparation for such reletting. To
the extent Lessor receives any damages pursuant to this Section 17.4, such
amounts shall be regarded as amounts paid on account of Rent. Lessee
specifically acknowledges and agrees that its obligations under this Section
17.4 shall be absolute and unconditional under any and all circumstances and
shall be paid and/or performed, as the case may be, without notice or demand
and without any abatement, reduction, diminution, setoff, defense, counterclaim
or recoupment whatsoever.
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17.5 POWER OF SALE.
Without limiting any other remedies set forth in this Lease,
Lessor and Lessee agree that Lessee has granted, pursuant to Section 7.1(b)
hereof and each Lease Supplement, a Lien against the Properties WITH POWER OF
SALE, and that, upon the occurrence and during the continuance of any Lease
Event of Default, Lessor shall have the power and authority, to the extent
provided by law, after prior notice and lapse of such time as may be required
by law, to foreclose its interest (or cause such interest to be foreclosed) in
all or any part of the Properties.
17.6 FINAL LIQUIDATED DAMAGES.
If a Lease Event of Default shall have occurred and be
continuing, whether or not this Lease shall have been terminated pursuant to
Section 17.1 and whether or not Lessor shall have collected any current
liquidated damages pursuant to Section 17.4, Lessor shall have the right to
recover, by demand to Lessee and at Lessor's election, and Lessee shall pay to
Lessor, as and for final liquidated damages, but exclusive of the indemnities
payable under Section 11 of the Participation Agreement (which, if requested,
shall be paid concurrently), and in lieu of all current liquidated damages
beyond the date of such demand (it being agreed that it would be impossible
accurately to determine actual damages) the Termination Value. Upon payment of
the amount specified pursuant to the first sentence of this Section 17.6,
Lessee shall be entitled to receive from Lessor, either at Lessee's request or
upon Lessor's election, in either case at Lessee's cost, an assignment of
Lessor's entire right, title and interest in and to the Properties,
Improvements, Fixtures, Modifications, Equipment and all components thereof
(including Lessor's leasehold interests under any Head Lease), in each case in
recordable form and otherwise in conformity with local custom and free and
clear of the Lien of this Lease (including without limitation the release of
any memoranda of Lease and/or the Lease Supplement recorded in connection
therewith) and any Lessor Liens. The Properties (and Lessor's leasehold
interests under any Head Leases) shall be conveyed to Lessee "AS-IS, WHERE-IS"
and in their then present physical condition. If any statute or rule of law
shall limit the amount of such final liquidated damages to less than the amount
agreed upon, Lessor shall be entitled to the maximum amount allowable under
such statute or rule of law; provided, however, Lessee shall not be entitled to
receive an assignment of Lessor's interest in the Properties, the Improvements,
Fixtures, Modifications, Equipment or the components thereof (including
Lessor's leasehold interests under any Head Leases) unless Lessee shall have
paid in full the Termination Value. Lessee specifically acknowledges and agrees
that its obligations under this Section 17.6 shall be absolute and
unconditional under any and all circumstances and shall be paid and/or
performed, as the case may be, without notice or demand and without any
abatement, reduction, diminution, setoff, defense, counterclaim or recoupment
whatsoever.
17.7 ENVIRONMENTAL COSTS.
If a Lease Event of Default shall have occurred and be
continuing, and whether or not this Lease shall have been terminated pursuant
to Section 17.1, Lessee shall pay directly to any third party (or at Lessor's
election, reimburse Lessor) for the cost of any environmental
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testing and/or remediation work undertaken respecting any Property, as such
testing or work is deemed appropriate in the reasonable judgment of Lessor.
Lessee shall pay all amounts referenced in the immediately preceding sentence
within ten (10) days of any request by Lessor for such payment. The provisions
of this Section 17.7 shall not limit the obligations of Lessee under any
Operative Agreement regarding indemnification obligations, environmental
testing, remediation and/or work.
17.8 WAIVER OF CERTAIN RIGHTS.
If this Lease shall be terminated pursuant to Section 17.1,
Lessee waives, to the fullest extent permitted by Law, (a) any notice of
re-entry or the institution of legal proceedings to obtain re-entry or
possession; (b) any right of redemption, re-entry or possession; (c) the
benefit of any laws now or hereafter in force exempting property from liability
for rent or for debt; and (d) any other rights which might otherwise limit or
modify any of Lessor's rights or remedies under this Article XVII.
17.9 ASSIGNMENT OF RIGHTS UNDER CONTRACTS.
If a Lease Event of Default shall have occurred and be
continuing, and whether or not this Lease shall have been terminated pursuant
to Section 17.1, Lessee shall upon Lessor's demand immediately assign, transfer
and set over to Lessor all of Lessee's right, title and interest in and to each
agreement executed by Lessee in connection with the acquisition, installation,
testing, use, development, construction, operation, maintenance, repair,
refurbishment and restoration of the Properties (including without limitation
all right, title and interest of Lessee with respect to all warranty,
performance, service and indemnity provisions), as and to the extent that the
same relate to the acquisition, installation, testing, use, development,
construction, operation, maintenance, repair, refurbishment and restoration of
the Properties or any of them.
17.10 REMEDIES CUMULATIVE.
The remedies herein provided shall be cumulative and in addition
to (and not in limitation of) any other remedies available at law, equity or
otherwise, including without limitation any mortgage foreclosure remedies.
ARTICLE XVIII
18.1 LESSOR'S RIGHT TO CURE LESSEE'S LEASE DEFAULTS.
Lessor, without waiving or releasing any obligation or Lease
Event of Default, may (but shall be under no obligation to) remedy any Lease
Event of Default for the account and at the sole cost and expense of Lessee,
including without limitation the failure by Lessee to maintain the insurance
required by Article XIV, and may, to the fullest extent permitted by law, and
notwithstanding any right of quiet enjoyment in favor of Lessee, enter upon any
Property, and take all such action thereon as may be necessary or appropriate
therefor. No such entry shall
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be deemed an eviction of any lessee. All out-of-pocket costs and expenses so
incurred (including without limitation fees and expenses of counsel), together
with interest thereon at the Overdue Rate from the date on which such sums or
expenses are paid by Lessor, shall be paid by Lessee to Lessor on demand.
ARTICLE XIX
19.1 PROVISIONS RELATING TO LESSEE'S EXERCISE OF ITS PURCHASE OPTION.
Subject to Section 19.2, in connection with any termination of
this Lease with respect to any Property pursuant to the terms of Section 16.2,
or in connection with Lessee's exercise of its Purchase Option, upon the date
on which this Lease is to terminate with respect to any Property, and upon
tender by Lessee of the amounts set forth in Sections 16.2(b) or 20.2, as
applicable, Lessor shall execute and deliver to Lessee (or to Lessee's
designee) at Lessee's cost and expense an assignment (by deed or other
appropriate instrument) of Lessor's entire interest in such Property (including
Lessor's leasehold interests under any Head Lease), in each case in recordable
form and otherwise in conformity with local custom and free and clear of any
Lessor Liens attributable to Lessor but without any other warranties (of title
or otherwise) from Lessor. Such Property (or leasehold interests under any Head
Lease) shall be conveyed to Lessee "AS-IS, WHERE-IS" and in then present
physical condition.
19.2 NO PURCHASE OR TERMINATION WITH RESPECT TO LESS THAN ALL OF A
PROPERTY.
Lessee shall not be entitled to exercise its Purchase Option or
the Sale Option separately with respect to a portion of any Property consisting
of Land, Equipment, Improvements and/or any interest pursuant to a Ground Lease
or Head Lease but shall be required to exercise its Purchase Option or the Sale
Option with respect to an entire Property.
ARTICLE XX
20.1 PURCHASE OPTION OR SALE OPTION-GENERAL PROVISIONS.
Not less than one hundred eighty (180) days (or respecting the
Purchase Option only, not less than sixty (60) days) and no more than two
hundred forty (240) days prior to the third annual anniversary of the date of
this Lease, the Expiration Date or, respecting the Purchase Option only, any
Payment Date (such third annual anniversary date, such Expiration Date or,
respecting the Purchase Option only, any such Payment Date being hereinafter
referred to as the "Election Date"), Lessee may give Lessor irrevocable written
notice (the "Election Notice") that Lessee is electing to exercise either (a)
the option to purchase all, but not less than all, the Properties (including
Lessor's leasehold interests in all Properties subject to Head Leases) on the
applicable Election Date (the "Purchase Option") or (b) with respect to an
Election Notice given in connection with the third annual anniversary of the
date of this Lease or the Expiration Date only, the option to remarket all, but
not less than all, the Properties (including Lessor's leasehold
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interests in all Properties subject to Head Leases) to a Person other than
Lessee or any Affiliate of Lessee and cause a sale of such Properties
(including Lessor's leasehold interests in all Properties subject to Head
Leases) to occur on the applicable Election Date pursuant to the terms of
Section 22.1 (the "Sale Option"). If Lessee does not give an Election Notice
indicating the Purchase Option or the Sale Option at least one hundred eighty
(180) days and not more than two hundred forty (240) days prior to the
Expiration Date, then Lessee shall be deemed to have elected for the Purchase
Option to apply on the Expiration Date. If Lessee shall either (i) elect (or be
deemed to have elected) to exercise the Purchase Option or (ii) elect the Sale
Option and fail to cause all, but not less than all, the Properties (including
Lessor's leasehold interests in all Properties subject to Head Leases) to be
sold in accordance with the terms of Section 22.1 on the applicable Election
Date, then in either case Lessee shall pay to Lessor on the date on which such
purchase or sale is scheduled to occur an amount equal to the Termination Value
for all, but not less than all, the Properties (including Lessor's leasehold
interests in all Properties subject to Head Leases) (which amount the parties
do not intend to be a "bargain" purchase price) and, upon receipt of such
amounts and satisfaction of such obligations, Lessor shall transfer to Lessee
all of Lessor's right, title and interest in and to all, but not less than all,
the Properties (including Lessor's leasehold interests in all Properties
subject to Head Leases) in accordance with Section 20.2.
20.2 LESSEE PURCHASE OPTION.
Provided, no Default or Event of Default shall have occurred and
be continuing (other than those that will be cured by the payment of the
Termination Value for all the Properties) and provided, that the Election
Notice has been appropriately given specifying the Purchase Option, Lessee
shall purchase all the Properties (including Lessor's leasehold interests in
all Properties subject to Head Leases) on the applicable Election Date at a
price equal to the Termination Value for such Properties (which price the
parties do not intend to be a "bargain" purchase price).
Subject to Section 19.2, in connection with any termination of
this Lease with respect to any Property pursuant to the terms of Section 16.2,
or in connection with Lessee's exercise of its Purchase Option, upon the date
on which this Lease is to terminate with respect to a Property or all of the
Properties, and upon tender by Lessee of the amounts set forth in Section
16.2(b) or this Section 20.2, as applicable, Lessor shall execute, acknowledge
(where required) and deliver to Lessee, at Lessee's cost and expense, each of
the following: (a) an assignment of Lessor's leasehold interest under each Head
Lease and a termination or assignment (as requested by the Lessee) of each
applicable Ground Lease and special or limited warranty Deeds conveying each
Property (to the extent it is real property not subject to a Ground Lease or a
Head Lease) to Lessee free and clear of the Lien of this Lease, the Lien of the
Credit Documents and any Lessor Liens; (b) a ▇▇▇▇ of Sale conveying each
Property (to the extent it is personal property not subject to a Head Lease) to
Lessee free and clear of the Lien of this Lease, the Lien of the Credit
Documents and any Lessor Liens; (c) any real estate tax affidavit or other
document required by law to be executed and filed in order to record the
applicable Deed and/or the applicable Ground Lease termination; and (d) FIRPTA
affidavits. All of the foregoing documentation must be in form and substance
reasonably satisfactory to Lessor. The applicable
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Property (or leasehold interest under each applicable Head Lease) shall be
conveyed without warranty to Lessee "AS-IS, WHERE-IS" and in then present
physical condition.
If any Property is the subject of remediation efforts respecting
Hazardous Substances at the applicable Election Date which could materially and
adversely impact the Fair Market Sales Value of such Property (or leasehold
interest under such applicable Head Lease) (with materiality determined in
Lessor's discretion), then Lessee shall be obligated to purchase each such
Property (or leasehold interest under such applicable Head Lease) pursuant to
Section 20.2.
On the applicable Election Date on which Lessee has elected to
exercise its Purchase Option, Lessee shall pay (or cause to be paid) to Lessor,
the Bank and all other parties, as appropriate, the sum of all costs and
expenses incurred by any such party in connection with the election by Lessee
to exercise its Purchase Option and all Rent and all other amounts then due and
payable or accrued under this Lease and/or any other Operative Agreement.
20.3 THIRD PARTY SALE OPTION.
(a) Provided, that (i) no Default or Event of Default shall have
occurred and be continuing and (ii) the Election Notice has been
appropriately given specifying the Sale Option, Lessee shall undertake
to cause a sale of the Properties (including Lessor's leasehold
interests in all Properties subject to Head Leases) on the applicable
Election Date (all as specified in the Election Notice), in accordance
with the provisions of Section 22.1 hereof. Such Election Date on
which a sale is required may be hereafter referred to as the "Sale
Date".
(b) In the event Lessee exercises the Sale Option then, as soon
as practicable and in all events not less than sixty (60) days prior
to the Sale Date, Lessee at its expense shall cause to be delivered to
Lessor a Phase I environmental site assessment for each of the
Properties recently prepared (no more than thirty (30) days old prior
to the Sale Date) by an independent recognized professional reasonably
acceptable to Lessor and in form, scope and content reasonably
satisfactory to Lessor. In the event that Lessor shall not have
received such environmental site assessment by the date sixty (60)
days prior to the Sale Date or in the event that such environmental
assessment shall reveal the existence of any material violation of
Environmental Laws, other material Environmental Violation or
potential material Environmental Violation (with materiality
determined in each case by Lessor in its reasonable discretion), then
Lessee on the Sale Date shall pay to Lessor an amount equal to the
Termination Value for all the Properties (including Lessor's leasehold
interests in all Properties subject to Head Leases) and any and all
other amounts due and owing hereunder. Upon receipt of such payment
and all other amounts due under the Operative Agreements, Lessor shall
transfer to Lessee all of Lessor's right, title and interest in and to
all the Properties in accordance with Section 19.1.
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ARTICLE XXI
21.1 [INTENTIONALLY OMITTED].
ARTICLE XXII
22.1 SALE PROCEDURE.
(a) During the Marketing Period, Lessee, on behalf of Lessor,
shall obtain bids for the cash purchase of all the Properties
(including Lessor's leasehold interests in all Properties subject to
Head Leases) in connection with a sale to one (1) or more third party
purchasers to be consummated on the Sale Date for the highest price
available, shall notify Lessor promptly of the name and address of
each prospective purchaser and the cash price which each prospective
purchaser shall have offered to pay for each such Property (including
Lessor's leasehold interests in all Properties subject to Head Leases)
and shall provide Lessor with such additional information about the
bids and the bid solicitation procedure as Lessor may reasonably
request from time to time. All such prospective purchasers must be
Persons other than Lessee or any Affiliate of Lessee. On the Sale
Date, Lessee shall pay (or cause to be paid) to Lessor and all other
parties, as appropriate, the sum of all costs and expenses incurred by
Lessor and/or the Bank (as the case may be) in connection with such
sale of one or more Properties (including Lessor's leasehold interests
with respect to one or more Properties subject to Head Leases), all
Rent and all other amounts then due and payable or accrued under this
Lease and/or any other Operative Agreement.
Lessor may reject any and all bids and may solicit and obtain
bids by giving Lessee written notice to that effect; provided,
however, that notwithstanding the foregoing, Lessor may not reject the
bids submitted by Lessee if such bids, in the aggregate, are greater
than or equal to the sum of the Limited Recourse Amount for all the
Properties (including Lessor's leasehold interests in all Properties
subject to Head Leases), and represent bona fide offers from one (1)
or more third party purchasers. If the highest price which a
prospective purchaser or the prospective purchasers shall have offered
to pay for all the Properties (including Lessor's leasehold interests
in all Properties subject to Head Leases) on the Sale Date is less
than the sum of the Limited Recourse Amount for all the Properties
(including Lessor's leasehold interests in all Properties subject to
Head Leases) or if such bids do not represent bona fide offers from
one (1) or more third parties or if there are no bids, Lessor may
elect to retain one or more of the Properties (or Lessor's leasehold
interest in one or more of the Properties subject to any Head Lease)
by giving Lessee prior written notice of Lessor's election to retain
the same, and promptly upon receipt of such notice, Lessee shall
surrender, or cause to be surrendered, each of the Properties
specified in such notice in accordance with the terms and conditions
of Section 10.1. Upon acceptance of any bid, Lessor agrees, at
Lessee's request and expense, to execute a contract of sale with
respect to such sale, so long as the
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same is consistent with the terms of this Article 22 and provides by
its terms that it is nonrecourse to Lessor.
Unless Lessor shall have elected to retain one or more of the
Properties (or Lessor's leasehold interest in one or more of the
Properties subject to any Head Lease) pursuant to the provisions of
the preceding paragraph, Lessee shall arrange for Lessor to sell all
the Properties (including Lessor's leasehold interests in all
Properties subject to Head Leases) free and clear of the Lien of this
Lease and any Lessor Liens attributable to Lessor, without recourse or
warranty (of title or otherwise), for cash on the Sale Date to the
purchaser or purchasers offering the highest cash sales price, as
identified by Lessee or Lessor, as the case may be; provided, however,
solely as to Lessor or the Trust Company, in its individual capacity,
any Lessor Lien shall not constitute a Lessor Lien so long as Lessor
or the Trust Company, in its individual capacity, is diligently and in
good faith contesting, at the cost and expense of Lessor or the Trust
Company, in its individual capacity, such Lessor Lien by appropriate
proceedings in which event the applicable Sale Date, all without
penalty or cost to Lessee, shall be delayed for the period of such
contest. To effect such transfer and assignment, Lessor shall execute,
acknowledge (where required) and deliver to the appropriate purchaser
each of the following: (a) special or limited warranty Deeds conveying
each such Property (to the extent it is real property titled to
Lessor) and an assignment of the Ground Lease or Head Lease conveying
the leasehold interest of Lessor in each such Property (to the extent
it is real property and subject to a Ground Lease or a Head Lease) to
the appropriate purchaser free and clear of the Lien of this Lease,
the Lien of the Credit Documents and any Lessor Liens; (b) a ▇▇▇▇ of
Sale conveying each such Property (to the extent it is personal
property not subject to a Head Lease) titled to Lessor to the
appropriate purchaser free and clear of the Lien of this Lease, the
Lien of the Credit Documents and any Lessor Liens; (c) any real estate
tax affidavit or other document required by law to be executed and
filed in order to record each Deed and/or each Ground Lease or Head
Lease assignment; and (d) FIRPTA affidavits, as appropriate. All of
the foregoing documentation must be in form and substance reasonably
satisfactory to Lessor. Lessee shall surrender the Properties
(including Lessor's leasehold interests in all Properties subject to
Head Leases) so sold or subject to such documents to each purchaser in
the condition specified in Section 10.1, or in such other condition as
may be agreed between Lessee and such purchaser. Lessee shall not take
or fail to take any action which would have the effect of unreasonably
discouraging bona fide third party bids for any Property. If each of
the Properties is not either (i) sold on the Sale Date in accordance
with the terms of this Section 22.1, or (ii) retained by Lessor
pursuant to an affirmative election made by Lessor pursuant to the
second sentence of the second paragraph of this Section 22.1(a), then
(x) Lessee shall be obligated to pay Lessor on the Sale Date an amount
equal to the aggregate Termination Value for all the Properties
(including Lessor's leasehold interests in all Properties subject to
Head Leases) less any sales proceeds received, and (y) Lessor shall
transfer each applicable Property (or Lessor's leasehold interest in
each applicable Property subject to a Head Lease) to Lessee in
accordance with Section 20.2.
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(b) If the Properties (including Lessor's leasehold interests in
all Properties subject to Head Leases) are sold on a Sale Date to one
(1) or more third party purchasers in accordance with the terms of
Section 22.1(a) and the aggregate purchase price paid for all the
Properties (including Lessor's leasehold interests in all Properties
subject to Head Leases) is less than the sum of the aggregate Property
Cost for all the Properties (including Lessor's leasehold interests in
all Properties subject to Head Leases) (hereinafter such difference
shall be referred to as the "Deficiency Balance"), then Lessee hereby
unconditionally promises to pay to Lessor on the Sale Date the lesser
of (i) the Deficiency Balance, or (ii) the Maximum Residual Guarantee
Amount for all the Properties (including Lessor's leasehold interests
in all Properties subject to Head Leases). On a Sale Date if (x)
Lessor receives the aggregate Termination Value for all the Properties
(including Lessor's leasehold interests in all Properties subject to
Head Leases) from one (1) or more third party purchasers, (y) Lessor
and such other parties receive all other amounts specified in the last
sentence of the first paragraph of Section 22.1(a) and (z) the
aggregate purchase price paid for all the Properties (including
Lessor's leasehold interests in all Properties subject to Head Leases)
on such date exceeds the sum of the aggregate Property Cost for all
the Properties (including Lessor's leasehold interests in all
Properties subject to Head Leases), then Lessee may retain such
excess. If one or more of the Properties (or Lessor's leasehold
interests in one or more Properties subject to one or more Head
Leases) are retained by Lessor pursuant to an affirmative election
made by Lessor pursuant to the provisions of Section 22.1(a), then
Lessee hereby unconditionally promises to pay to Lessor on the Sale
Date an amount equal to the Maximum Residual Guarantee Amount for the
Properties so retained. Any payment of the foregoing amounts described
in this Section 22.1(b) shall be made together with a payment of all
other amounts referenced in the last sentence of the first paragraph
of Section 22.1(a).
(c) In the event that all the Properties (including Lessor's
leasehold interests in all Properties subject to Head Leases) are
either sold to one (1) or more third party purchasers on the Sale Date
or retained by Lessor in connection with an affirmative election made
by Lessor pursuant to the provisions of Section 22.1(a), then in
either case on the applicable Sale Date Lessee shall provide Lessor or
such third party purchaser (unless otherwise agreed by such third
party purchaser) with (i) all permits, certificates of occupancy,
governmental licenses and authorizations necessary to use, operate,
repair, access and maintain each such Property for the purpose it is
being used by Lessee, and (ii) such manuals, permits, easements,
licenses, intellectual property, know-how, rights-of-way and other
rights and privileges in the nature of an easement as are reasonably
necessary or desirable in connection with the use, operation, repair,
access to or maintenance of each such Property for its intended
purpose or otherwise as Lessor or such third party purchaser(s) shall
reasonably request (and a royalty-free license or similar agreement to
effectuate the foregoing on terms reasonably agreeable to Lessor or
such third party purchaser(s), as applicable). All assignments,
licenses, easements, agreements and other deliveries required by
clauses (i) and (ii) of this paragraph (c) shall be in form reasonably
satisfactory to Lessor or such third party purchaser(s), as
applicable, and shall be fully assignable (including without
limitation both primary
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assignments and assignments given in the nature of security) without
payment of any fee, cost or other charge. Lessee shall also execute
any documentation requested by Lessor or such third party
purchaser(s), as applicable, evidencing the continuation or assignment
of each Ground Lease.
22.2 APPLICATION OF PROCEEDS OF SALE.
Lessor shall apply the proceeds of sale of any Property (or sale
of any leasehold interest in any Property subject to a Head Lease) in the
following order of priority:
(a) FIRST, to pay or to reimburse Lessor (and/or the Bank, as
the case may be) for the payment of all reasonable costs and expenses
incurred by Lessor (and/or the Bank, as the case may be) in connection
with the sale (to the extent Lessee has not satisfied its obligation
to pay such costs and expenses);
(b) SECOND, so long as the Credit Agreement is in effect and any
Loans or Holder Advances or any amount is owing to the Financing
Parties under any Operative Agreement, to the Bank to be allocated in
accordance with Section 8.7 of the Participation Agreement; and
(c) THIRD, to Lessee.
22.3 INDEMNITY FOR EXCESSIVE WEAR.
If the proceeds of the sale described in Section 22.1 with
respect to Lessor's interest in the Properties shall be less than the Limited
Recourse Amount with respect to the Properties, and at the time of such sale it
shall have been reasonably determined (pursuant to the Appraisal Procedure)
that the Fair Market Sales Value of Lessor's interest in the Properties shall
have been impaired by greater than expected wear and tear during the term of
the Lease, Lessee shall pay to Lessor within ten (10) days after receipt of
Lessor's written statement (i) the amount of such excess wear and tear
determined by the Appraisal Procedure or (ii) the amount of the Sale Proceeds
Shortfall, whichever amount is less.
22.4 APPRAISAL PROCEDURE.
For determining the Fair Market Sales Value of the Properties
(including Lessor's leasehold interests in all Properties subject to Head
Leases) or any other amount which may, pursuant to any provision of any
Operative Agreement, be determined by an appraisal procedure, Lessor and Lessee
shall use the following procedure (the "Appraisal Procedure"). Lessor and
Lessee shall endeavor to reach a mutual agreement as to such amount for a
period of ten (10) days from commencement of the Appraisal Procedure under the
applicable section of the Lease, and if they cannot agree within ten (10) days,
then two (2) qualified appraisers, one (1) chosen by Lessee and one (1) chosen
by Lessor, shall mutually agree thereupon, but if either party shall fail to
choose an appraiser within twenty (20) days after notice from the other party
of the selection of its appraiser, then the appraisal by such appointed
appraiser shall be binding on Lessee and
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Lessor. If the two (2) appraisers cannot agree within twenty (20) days after
both shall have been appointed, then a third appraiser shall be selected by the
two (2) appraisers or, failing agreement as to such third appraiser within
thirty (30) days after both shall have been appointed, by the American
Arbitration Association. The decisions of the three (3) appraisers shall be
given within twenty (20) days of the appointment of the third appraiser and the
decision of the appraiser most different from the average of the other two (2)
shall be discarded and such average shall be binding on Lessor and Lessee;
provided, that if the highest appraisal and the lowest appraisal are
equidistant from the third appraisal, the third appraisal shall be binding on
Lessor and Lessee. The fees and expenses of the appraiser appointed by Lessee
shall be paid by Lessee; the fees and expenses of the appraiser appointed by
Lessor shall be paid by Lessor (such fees and expenses not being indemnified
pursuant to Section 11 of the Participation Agreement); and the fees and
expenses of the third appraiser shall be divided equally between Lessee and
Lessor.
22.5 CERTAIN OBLIGATIONS CONTINUE.
During the Marketing Period, the obligation of Lessee to pay
Rent with respect to the Properties (including without limitation the
installment of Basic Rent due on the Sale Date) shall continue undiminished
until payment in full to Lessor of the sale proceeds, if any, the Maximum
Residual Guarantee Amount, the amount due under Section 22.3, if any, and all
other amounts due to Lessor or any other Person with respect to all Properties
or any Operative Agreement. Lessor shall have the right, but shall be under no
duty, to solicit bids, to inquire into the efforts of Lessee to obtain bids or
otherwise to take action in connection with any such sale, other than as
expressly provided in this Article XXII.
ARTICLE XXIII
23.1 HOLDING OVER.
If Lessee shall for any reason remain in possession of a
Property after the expiration or earlier termination of this Lease as to such
Property (unless such Property is conveyed to Lessee), such possession shall be
as a tenancy at sufferance during which time Lessee shall continue to pay
Supplemental Rent that would be payable by Lessee hereunder were the Lease then
in full force and effect with respect to such Property and Lessee shall
continue to pay Basic Rent at the lesser of the highest lawful rate and one
hundred ten percent (110%) of the last payment of Basic Rent due with respect
to such Property prior to such expiration or earlier termination of this Lease.
Such Basic Rent shall be payable from time to time upon demand by Lessor and
such additional amount of Basic Rent shall be applied by Lessor ratably to the
Lenders and the Holders based on their relative amounts of the then outstanding
aggregate Property Cost for all Properties. During any period of tenancy at
sufferance, Lessee shall, subject to the second preceding sentence, be
obligated to perform and observe all of the terms, covenants and conditions of
this Lease, but shall have no rights hereunder other than the right, to the
extent given by law to tenants at sufferance, to continue their occupancy and
use of such Property. Nothing contained in this Article XXIII shall constitute
the consent, express or implied, of Lessor to the holding over of Lessee after
the expiration or earlier termination of this
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Lease as to any Property (unless such Property (or Lessor's leasehold interest
therein) is conveyed to Lessee) and nothing contained herein shall be read or
construed as preventing Lessor from maintaining a suit for possession of such
Property or exercising any other remedy available to Lessor at law or in
equity.
ARTICLE XXIV
24.1 RISK OF LOSS.
During the Term, unless Lessee shall not be in actual possession
of any Property in question solely by reason of Lessor's exercise of its
remedies of dispossession under Article XVII, the risk of loss or decrease in
the enjoyment and beneficial use of such Property as a result of the damage or
destruction thereof by fire, the elements, casualties, thefts, riots, wars or
otherwise is assumed by Lessee, and Lessor shall in no event be answerable or
accountable therefor.
ARTICLE XXV
25.1 ASSIGNMENT.
(a) Lessee may not assign this Lease or any of its rights or
obligations hereunder or with respect to any Property in whole or in
part to any Person without the prior written consent of the Bank and
Lessor.
(b) No assignment by Lessee (referenced in this Section 25.1 or
otherwise) or other relinquishment of possession to any Property shall
in any way discharge or diminish any of the obligations of Lessee to
Lessor hereunder and Lessee shall remain directly and primarily liable
under the Operative Agreements as to any rights or obligations
assigned by Lessee or regarding any Property in which rights or
obligations have been assigned or otherwise transferred.
25.2 SUBLEASES.
(a) Promptly, but in any event within five (5) Business Days,
following the execution and delivery of any sublease permitted by this
Article XXV, Lessee shall notify Lessor of the execution of such
sublease. As of the date of each Lease Supplement, Lessee shall lease
the respective Properties (or sublease Lessor's leasehold interest
therein, as the case may be) described in such Lease Supplement from
Lessor, and any existing tenant respecting such Property shall
automatically be deemed to be a subtenant of Lessee and not a tenant
of Lessor.
(b) So long as no Lease Event of Default shall have occurred and
be continuing, without the prior written consent of the Bank or Lessor
and subject to the
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other provisions of this Section 25.2, Lessee may sublet any Property
or portion thereof (or Lessor's leasehold interest therein, as the
case may be) to any wholly-owned Subsidiary of Lessee. Except as
referenced in the immediately preceding sentence, no other subleases
shall be permitted unless consented to in writing by Lessor. All
subleasing shall be done on market terms and shall in no way diminish
the fair market value or useful life of any applicable Property (or
Lessor's leasehold interest therein, as the case may be).
(c) No sublease (referenced in this Section 25.2 or otherwise)
or other relinquishment of possession to any Property shall in any way
discharge or diminish any of Lessee's obligations to Lessor hereunder
and Lessee shall remain directly and primarily liable under this Lease
as to such Property, or portion thereof, so sublet. The term of any
such sublease shall not extend beyond the Term. Each sublease shall be
expressly subject and subordinate to this Lease.
ARTICLE XXVI
26.1 NO WAIVER.
No failure by Lessor or Lessee to insist upon the strict
performance of any term hereof or to exercise any right, power or remedy upon a
default hereunder, and no acceptance of full or partial payment of Rent during
the continuance of any such default, shall constitute a waiver of any such
default or of any such term. To the fullest extent permitted by law, no waiver
of any default shall affect or alter this Lease, and this Lease shall continue
in full force and effect with respect to any other then existing or subsequent
default.
ARTICLE XXVII
27.1 ACCEPTANCE OF SURRENDER.
No surrender to Lessor of this Lease or of all or any portion of
any Property or of any part of any thereof or of any interest therein shall be
valid or effective unless agreed to and accepted in writing by Lessor and no
act by Lessor or the Bank or any representative or agent of Lessor or the Bank,
other than a written acceptance, shall constitute an acceptance of any such
surrender.
27.2 NO MERGER OF TITLE.
There shall be no merger of this Lease or of the leasehold
estate created hereby by reason of the fact that the same Person may acquire,
own or hold, directly or indirectly, in whole or in part, (a) this Lease or the
leasehold estate created hereby or any interest in this Lease or such leasehold
estate, (b) any right, title or interest in any Property, (c) any Notes, or (d)
a beneficial interest in Lessor.
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ARTICLE XXVIII
28.1 INCORPORATION OF COVENANTS.
Reference is made to the Lessee Credit Agreement and the
representations and warranties of Lessee contained in Article VI of the Lessee
Credit Agreement (hereinafter referred to as the "Incorporated Representations
and Warranties") and the covenants contained in Articles VII, VIII, IX and X of
the Lessee Credit Agreement (hereinafter referred to as the "Incorporated
Covenants"). Lessee agrees with Lessor that the Incorporated Representations
and Warranties and the Incorporated Covenants (and all other relevant
provisions of the Lessee Credit Agreement related thereto, including without
limitation the defined terms contained in Article I thereof which are used in
the Incorporated Representations and Warranties and the Incorporated Covenants,
hereinafter referred to as the "Additional Incorporated Terms") are hereby
incorporated by reference into this Lease to the same extent and with the same
effect as if set forth fully herein and shall inure to the benefit of Lessor,
without giving effect to any waiver, amendment, modification or replacement of
the Lessee Credit Agreement or any term or provision of the Incorporated
Representations and Warranties or the Incorporated Covenants occurring
subsequent to the date of this Lease, except to the extent otherwise
specifically provided in the following provisions of this paragraph. In the
event a waiver is granted under the Lessee Credit Agreement or an amendment or
modification is executed with respect to the Lessee Credit Agreement, and such
waiver, amendment and/or modification affects the Incorporated Representations
and Warranties, the Incorporated Covenants or the Additional Incorporated
Terms, then such waiver, amendment or modification shall be effective with
respect to the Incorporated Representations and Warranties, the Incorporated
Covenants and the Additional Incorporated Terms as incorporated by reference
into this Lease. In the event of any replacement of the Lessee Credit Agreement
with a similar credit facility (the "New Facility") the representations and
warranties, covenants and additional terms contained in the New Facility which
correspond to the representations and warranties, covenants contained in
Article VI and Articles VII, VIII, IX and X, respectively, and such additional
terms (each of the foregoing contained in the Lessee Credit Agreement) shall
become the Incorporated Representations and Warranties, the Incorporated
Covenants and the Additional Incorporated Terms and, if the Lessee Credit
Agreement is terminated and not replaced, then the representations and
warranties and covenants contained in Article VI and Articles VII, VIII, IX and
X, respectively, and such additional terms (each of the foregoing contained in
the Lessee Credit Agreement (together with any modifications or amendments
approved in accordance with this paragraph)) shall continue to be the
Incorporated Representations and Warranties, the Incorporated Covenants and the
Additional Incorporated Terms hereunder.
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ARTICLE XXIX
29.1 NOTICES.
All notices required or permitted to be given under this Lease
shall be in writing and delivered as provided in the Participation Agreement.
ARTICLE XXX
30.1 MISCELLANEOUS.
Anything contained in this Lease to the contrary
notwithstanding, all claims against and liabilities of Lessee or Lessor arising
from events commencing prior to the expiration or earlier termination of this
Lease shall survive such expiration or earlier termination. If any provision of
this Lease shall be held to be unenforceable in any jurisdiction, such
unenforceability shall not affect the enforceability of any other provision of
this Lease and such jurisdiction or of such provision or of any other provision
hereof in any other jurisdiction.
30.2 AMENDMENTS AND MODIFICATIONS.
Neither this Lease nor any Lease Supplement may be amended,
waived, discharged or terminated except in accordance with the provisions of
Section 12.4 of the Participation Agreement.
30.3 SUCCESSORS AND ASSIGNS.
All the terms and provisions of this Lease shall inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
30.4 HEADINGS AND TABLE OF CONTENTS.
The headings and table of contents in this Lease are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
30.5 COUNTERPARTS.
This Lease may be executed in any number of counterparts, each
of which shall be an original, but all of which shall together constitute one
(1) and the same instrument.
30.6 GOVERNING LAW.
THIS LEASE SHALL BE GOVERNED BY AND CONSTRUED, INTERPRETED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
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OF NORTH CAROLINA, EXCEPT TO THE EXTENT THE LAWS OF THE STATE WHERE A
PARTICULAR PROPERTY IS LOCATED ARE REQUIRED TO APPLY.
30.7 CALCULATION OF RENT.
All calculation of Rent payable hereunder shall be computed
based on the actual number of days elapsed over a year of three hundred sixty
(360) days or, to the extent such Rent is based on the Prime Lending Rate,
three hundred sixty-five (365) (or three hundred sixty-six (366), as
applicable) days.
30.8 MEMORANDA OF LEASE AND LEASE SUPPLEMENTS.
This Lease shall not be recorded; provided, Lessor and Lessee
shall promptly record (a) a memorandum of this Lease and the applicable Lease
Supplement (in substantially the form of Exhibit B attached hereto) or a short
form lease (in form and substance reasonably satisfactory to Lessor) regarding
each Property promptly after the acquisition thereof in the local filing office
with respect thereto, in all cases at Lessee's cost and expense, and as
required under applicable law to sufficiently evidence this Lease and any such
Lease Supplement in the applicable real estate filing records.
30.9 [INTENTIONALLY LEFT BLANK].
30.10 LIMITATIONS ON RECOURSE.
Notwithstanding anything contained in this Lease to the
contrary, Lessee agrees to look solely to Lessor's estate and interest in the
Properties (and in no circumstance to the Bank or otherwise to Lessor) for the
collection of any judgment requiring the payment of money by Lessor in the
event of liability by Lessor, and no other property or assets of Lessor or any
shareholder, owner or partner (direct or indirect) in or of Lessor, or any
director, officer, employee, beneficiary, Affiliate of any of the foregoing
shall be subject to levy, execution or other enforcement procedure for the
satisfaction of the remedies of Lessee under or with respect to this Lease, the
relationship of Lessor and Lessee hereunder or Lessee's use of the Properties
or any other liability of Lessor to Lessee. Nothing in this Section shall be
interpreted so as to limit the terms of Sections 6.1 or 6.2 or the provisions
of Section 12.9 of the Participation Agreement.
30.11 WAIVERS OF JURY TRIAL.
EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY, TO
THE FULLEST EXTENT ALLOWED BY APPLICABLE LAW, WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS LEASE AND FOR ANY
COUNTERCLAIM THEREIN.
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30.12 EXERCISE OF LESSOR RIGHTS.
Lessee hereby acknowledges and agrees that the rights and powers
of Lessor under this Lease have been assigned to the Bank pursuant to the terms
of the Security Agreement and the other Operative Agreements. Lessor and Lessee
hereby acknowledge and agree that (a) the Bank shall, in its discretion, direct
and/or act on behalf of Lessor pursuant to the provisions of Sections 8.2(h)
and 8.6 of the Participation Agreement, (b) all notices to be given to Lessor
shall be given to the Bank and (c) all notices to be given by Lessor may be
given by the Bank, at its election.
30.13 SUBMISSION TO JURISDICTION; VENUE; ARBITRATION.
THE PROVISIONS OF THE PARTICIPATION AGREEMENT RELATING TO
SUBMISSION TO JURISDICTION, VENUE AND ARBITRATION ARE HEREBY INCORPORATED BY
REFERENCE HEREIN, MUTATIS MUTANDIS.
30.14 USURY SAVINGS PROVISION.
IT IS THE INTENT OF THE PARTIES HERETO TO CONFORM TO AND
CONTRACT IN STRICT COMPLIANCE WITH APPLICABLE USURY LAW FROM TIME TO TIME IN
EFFECT. TO THE EXTENT ANY RENT OR PAYMENTS HEREUNDER ARE HEREINAFTER
CHARACTERIZED BY ANY COURT OF COMPETENT JURISDICTION AS THE REPAYMENT OF
PRINCIPAL AND INTEREST THEREON, THIS SECTION 30.14 SHALL APPLY. ANY SUCH RENT
OR PAYMENTS SO CHARACTERIZED AS INTEREST MAY BE REFERRED TO HEREIN AS
"INTEREST." ALL AGREEMENTS AMONG THE PARTIES HERETO ARE HEREBY LIMITED BY THE
PROVISIONS OF THIS PARAGRAPH WHICH SHALL OVERRIDE AND CONTROL ALL SUCH
AGREEMENTS, WHETHER NOW EXISTING OR HEREAFTER ARISING AND WHETHER WRITTEN OR
ORAL. IN NO WAY, NOR IN ANY EVENT OR CONTINGENCY (INCLUDING WITHOUT LIMITATION
PREPAYMENT OR ACCELERATION OF THE MATURITY OF ANY OBLIGATION), SHALL ANY
INTEREST TAKEN, RESERVED, CONTRACTED FOR, CHARGED, OR RECEIVED UNDER THIS LEASE
OR OTHERWISE, EXCEED THE MAXIMUM NONUSURIOUS AMOUNT PERMISSIBLE UNDER
APPLICABLE LAW. IF, FROM ANY POSSIBLE CONSTRUCTION OF ANY OF THE OPERATIVE
AGREEMENTS OR ANY OTHER DOCUMENT OR AGREEMENT, INTEREST WOULD OTHERWISE BE
PAYABLE IN EXCESS OF THE MAXIMUM NONUSURIOUS AMOUNT, ANY SUCH CONSTRUCTION
SHALL BE SUBJECT TO THE PROVISIONS OF THIS PARAGRAPH AND SUCH AMOUNTS UNDER
SUCH DOCUMENTS OR AGREEMENTS SHALL BE AUTOMATICALLY REDUCED TO THE MAXIMUM
NONUSURIOUS AMOUNT PERMITTED UNDER APPLICABLE LAW, WITHOUT THE NECESSITY OF
EXECUTION OF ANY AMENDMENT OR NEW DOCUMENT OR AGREEMENT. IF LESSOR SHALL EVER
RECEIVE ANYTHING OF VALUE WHICH IS CHARACTERIZED AS INTEREST
41
47
WITH RESPECT TO THE OBLIGATIONS OWED HEREUNDER OR UNDER APPLICABLE LAW AND
WHICH WOULD, APART FROM THIS PROVISION, BE IN EXCESS OF THE MAXIMUM LAWFUL
AMOUNT, AN AMOUNT EQUAL TO THE AMOUNT WHICH WOULD HAVE BEEN EXCESSIVE INTEREST
SHALL, WITHOUT PENALTY, BE APPLIED TO THE REDUCTION OF THE COMPONENT OF
PAYMENTS DEEMED TO BE PRINCIPAL AND NOT TO THE PAYMENT OF INTEREST, OR REFUNDED
TO LESSEE OR ANY OTHER PAYOR THEREOF, IF AND TO THE EXTENT SUCH AMOUNT WHICH
WOULD HAVE BEEN EXCESSIVE EXCEEDS THE COMPONENT OF PAYMENTS DEEMED TO BE
PRINCIPAL. THE RIGHT TO DEMAND PAYMENT OF ANY AMOUNTS EVIDENCED BY ANY OF THE
OPERATIVE AGREEMENTS DOES NOT INCLUDE THE RIGHT TO RECEIVE ANY INTEREST WHICH
HAS NOT OTHERWISE ACCRUED ON THE DATE OF SUCH DEMAND, AND LESSOR DOES NOT
INTEND TO CHARGE OR RECEIVE ANY UNEARNED INTEREST IN THE EVENT OF SUCH DEMAND.
ALL INTEREST PAID OR AGREED TO BE PAID TO LESSOR SHALL, TO THE EXTENT PERMITTED
BY APPLICABLE LAW, BE AMORTIZED, PRORATED, ALLOCATED, AND SPREAD THROUGHOUT THE
FULL STATED TERM (INCLUDING WITHOUT LIMITATION ANY RENEWAL OR EXTENSION) OF
THIS LEASE SO THAT THE AMOUNT OF INTEREST ON ACCOUNT OF SUCH PAYMENTS DOES NOT
EXCEED THE MAXIMUM NONUSURIOUS AMOUNT PERMITTED BY APPLICABLE LAW.
30.15 ACKNOWLEDGMENT OF HEAD LEASE; BOND DOCUMENTS.
Lessee acknowledges and agrees that Lessor has entered into or may
enter into one or more Head Leases and related Bond Documents at the request
and direction of Lessee in order to make the property the subject of such Head
Leases available to Lessee pursuant to this Lease. Further, Lessee acknowledges
and agrees that it will incur a substantial benefit as a result of the Lessor
entering into such Head Leases and the related Bond Documents, including
without limitation a partial abatement of ad valorem taxes accruing in
connection with the property the subject of such Head Leases and this Lease.
Further, Lessee acknowledges and agrees that it has reviewed or will review the
terms and conditions of each Head Lease and the related Bond Documents.
Accordingly, Lessee specifically acknowledges and agrees that it shall pay and
perform, or cause to be paid and performed, each and every obligation of Lessor
arising under or in connection with any such Head Lease and the related Bond
Documents. The obligations arising hereunder shall survive the expiration or
termination of this Lease.
[signature pages follow]
42
48
IN WITNESS WHEREOF, the parties have caused this Lease to be duly
executed and delivered as of the date first above written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not individually, but
solely as the Owner Trustee under the
SRI Realty Trust 1998-1, as Lessor
By: /s/ Authorized Officer
----------------------------------
Name: Authorized Officer
--------------------------------
Title:
-------------------------------
STERILE RECOVERIES, INC., as Lessee
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------
Title: EVP
-------------------------------
Receipt of this original
counterpart of the foregoing
Lease is hereby acknowledged
as the date hereof
FIRST UNION NATIONAL BANK,
as Lender and Holder
By: /s/ ▇▇▇▇ Solatario
----------------------------------
Name: ▇▇▇▇ Solatario
--------------------------------
Title: Vice President
-------------------------------
49
EXHIBIT A TO THE LEASE
LEASE SUPPLEMENT NO. ___
THIS LEASE SUPPLEMENT NO. ___ (this "Lease Supplement") dated as of
___________, 199___ between FIRST SECURITY BANK, NATIONAL ASSOCIATION, a
national banking association, not individually, but solely as the Owner Trustee
under the SRI Realty Trust 1998-1, as lessor (the "Lessor"), and STERILE
RECOVERIES, INC., a Florida corporation, as lessee (the "Lessee").
WHEREAS, Lessor is the [owner or will be the owner of the
Property][lessee or will be the lessee of the Property pursuant to the Head
Lease attached as Schedule 1C] described on Schedule 1 hereto (the "Leased
Property") and wishes to lease the same to Lessee;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
SECTION 1. DEFINITIONS; RULES OF USAGE. For purposes of this Lease
Supplement, capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to them in Appendix A to the Participation
Agreement, dated as of February 1, 1999, among Lessee, Lessor, not
individually, except as expressly stated therein, but solely as the Owner
Trustee under the SRI Realty Trust 1998-1, and First Union National Bank, as
Lender and Holder, as such may be amended, modified, extended, supplemented,
restated and/or replaced from time to time.
SECTION 2. THE PROPERTIES. Attached hereto as Schedule 1 is the
description of the Leased Property, with an Equipment Schedule attached hereto
as Schedule 1 A, an Improvement Schedule attached hereto as Schedule 1 B and [a
legal description of the Land/a copy of the Ground Lease or a copy of the
Head Lease] attached hereto as Schedule 1 C. Effective upon the execution and
delivery of this Lease Supplement by Lessor and Lessee, the Leased Property
shall be subject to the terms and provisions of the Lease. Without further
action, any and all additional Equipment funded under the Operative Agreements
and any and all additional Improvements made to the Land shall be deemed to be
titled to the Lessor and subject to the terms and conditions of the Lease and
this Lease Supplement.
This Lease Supplement shall constitute a mortgage, deed of trust,
security agreement and financing statement under the laws of the state in which
the Leased Property is situated. The maturity date of the obligations secured
hereby shall be [___________] unless extended to not later than [___________].
For purposes of provisions of the Lease and this Lease Supplement
related to the creation and enforcement of the Lease and this Lease Supplement
as a security agreement and a fixture filing, Lessee is the debtor and Lessor
is the secured party. The mailing addresses of the debtor
A-1
50
(Lessee herein) and of the secured party (Lessor herein) from which information
concerning security interests hereunder may be obtained are set forth on the
signature pages hereto. A carbon, photographic or other reproduction of the
Lease and this Lease Supplement or of any financing statement related to the
Lease and this Lease Supplement shall be sufficient as a financing statement
for any of the purposes referenced herein.
SECTION 3. USE OF PROPERTY. At all times during the Term with respect
to each Property, Lessee will comply with all obligations under and (to the
extent no Event of Default exists and provided, that such exercise will not
impair the value of such Property) shall be permitted to exercise all rights
and remedies under, all operation and easement agreements and related or
similar agreements applicable to such Property.
SECTION 4. RATIFICATION; INCORPORATION BY REFERENCE. Except as
specifically modified hereby, the terms and provisions of the Lease and the
Operative Agreements are hereby ratified and confirmed and remain in full force
and effect. The Lease is hereby incorporated herein by reference as though
restated herein in its entirety.
SECTION 5. ORIGINAL LEASE SUPPLEMENT. The single executed original of
this Lease Supplement marked "THIS COUNTERPART IS THE ORIGINAL EXECUTED
COUNTERPART" on the signature page thereof and containing the receipt of the
Agent therefor on or following the signature page thereof shall be the original
executed counterpart of this Lease Supplement (the "Original Executed
Counterpart"). To the extent that this Lease Supplement constitutes chattel
paper, as such term is defined in the Uniform Commercial Code as in effect in
any applicable jurisdiction, no security interest in this Lease Supplement may
be created through the transfer or possession of any counterpart other than the
Original Executed Counterpart.
SECTION 6. GOVERNING LAW. THIS LEASE SUPPLEMENT SHALL BE GOVERNED BY
AND CONSTRUED, INTERPRETED TO AND ENFORCED IN ACCORDANCE WITH THE LAW OF THE
STATE OF NORTH CAROLINA, EXCEPT TO THE EXTENT THE LAWS OF THE STATE WHERE A
PARTICULAR PROPERTY IS LOCATED ARE REQUIRED TO APPLY.
SECTION 7. MORTGAGE; POWER OF SALE. Without limiting any other
remedies set forth in the Lease, in the event that a court of competent
jurisdiction rules that the Lease constitutes a mortgage, deed of trust or
other secured financing as is the intent of the parties, then Lessor and Lessee
agree that Lessee hereby grants a Lien against the Leased Property WITH POWER
OF SALE, and that, upon the occurrence of any Lease Event of Default, Lessor
shall have the power and authority, to the extent provided by law, after prior
notice and lapse of such time as may be required by law, to foreclose its
interest (or cause such interest to be foreclosed) in all or any part of the
Leased Property.
SECTION 8. COUNTERPART EXECUTION. This Lease Supplement may be
executed in any number of counterparts and by each of the parties hereto in
separate counterparts, all such counterparts together constituting but one (1)
and the same instrument.
A-2
51
For purposes of the provisions of this Lease Supplement concerning
this Lease Supplement constituting a security agreement and fixture filing, the
addresses of the debtor (Lessee herein) and the secured party (Lessor herein),
from whom information may be obtained about this Lease Supplement, are as set
forth on the signature pages hereto.
[The remainder of this page has been intentionally left blank.]
A-3
52
IN WITNESS WHEREOF, each of the parties hereto has caused this Lease
Supplement to be duly executed by an officer thereunto duly authorized as of
the date and year first above written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not individually, but
solely as the Owner Trustee under the
SRI Realty Trust 1998-1, as Lessor
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
First Security Bank, National
Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇. ▇▇▇▇▇
Vice President
STERILE RECOVERIES, INC.,
as Lessee
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
Sterile Recoveries, Inc.
▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Receipt of this original counterpart of the foregoing Lease Supplement is
hereby acknowledged as the date hereof.
FIRST UNION NATIONAL BANK, as
Lender and Holder
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
A-4
53
First Union National Bank
c/o First Union Capital Markets Group
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ 6
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
[CONFORM TO STATE LAW REQUIREMENTS]
STATE OF )
-----------------
) ss:
COUNTY OF )
----------------
The foregoing Lease Supplement was acknowledged before me, the
undersigned Notary Public, in the County of _________________ this _____ day of
______________, by ________________, as __________________ of FIRST SECURITY
BANK, NATIONAL ASSOCIATION, a national banking association, not individually,
but solely as the Owner Trustee under the SRI Realty Trust 1998-1, on behalf of
the Owner Trustee.
[Notarial Seal] --------------------------------------
Notary Public
My commission expires:
---------------
STATE OF )
-----------------
) ss:
COUNTY OF )
----------------
The foregoing Lease Supplement was acknowledged before me, the
undersigned Notary Public, in the County of _________________ this _____ day of
______________, by ________________, as __________________ of STERILE
RECOVERIES, INC., a Florida corporation, on behalf of the corporation.
[Notarial Seal] -------------------------------------
Notary Public
My commission expires:
---------------
STATE OF )
-----------------
) ss:
COUNTY OF )
----------------
The foregoing Lease Supplement was acknowledged before me, the
undersigned Notary Public, in the County of ________________ this ____ day of
___________, by _____________, as __________________ of FIRST UNION NATIONAL
BANK, a national banking association.
[Notarial Seal] -------------------------------------
Notary Public
My commission expires:
---------------
A-5
54
SCHEDULE 1
TO LEASE SUPPLEMENT NO. ____
(Description of the Leased Property)
A-6
55
SCHEDULE 1A
TO LEASE SUPPLEMENT NO. ____
(Schedule of Equipment)
56
SCHEDULE 1B
TO LEASE SUPPLEMENT NO. ____
(Schedule of Improvements)
57
SCHEDULE 1C
TO LEASE SUPPLEMENT NO. ____
(Legal Description of Land\copy of Ground Lease\copy of Head Lease)
58
EXHIBIT B TO THE LEASE
[MODIFY OR SUBSTITUTE SHORT FORM LEASE AS
NECESSARY FOR LOCAL LAW REQUIREMENTS]
Recordation requested by:
▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC
After recordation return to:
▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC (WMA)
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Space above this line
for Recorder's use
-------------------------------------------------------------------------------
MEMORANDUM OF LEASE AGREEMENT
AND
LEASE SUPPLEMENT NO. ____
THIS MEMORANDUM OF LEASE AGREEMENT AND LEASE SUPPLEMENT NO. ____
("Memorandum"), dated as of _____________, 1999, is by and between FIRST
SECURITY BANK, NATIONAL ASSOCIATION, a national banking association, not
individually, but solely as the Owner Trustee under the SRI Realty Trust
1998-1, with an office at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
(hereinafter referred to as "Lessor") and STERILE RECOVERIES, INC., a Florida
corporation with an office at ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇ (hereinafter referred to as "Lessee").
WITNESSETH:
That for value received, Lessor and Lessee do hereby covenant, promise
and agree as follows:
1. DEMISED PREMISES AND DATE OF LEASE. Lessor has leased to Lessee,
and Lessee has leased from Lessor, for the Term (as hereinafter defined),
certain real property and other property located in ________________ [subject
to a ground lease/head lease], which [ground lease/head lease] is described in
the attached Schedule 1 (the "Property"), pursuant to the terms of a Lease
Agreement between Lessor and Lessee dated as of February 1, 1999 (as such may
be amended, modified, extended, supplemented, restated and/or replaced from
time to time,
59
"Lease") and a Lease Supplement No. _____ between Lessor and Lessee dated as of
______________ (the "Lease Supplement").
The Lease and the Lease Supplement shall constitute a mortgage, deed
of trust and security agreement and financing statement under the laws of the
state in which the Property is situated. The maturity date of the obligations
secured thereby shall be ___________, unless extended to not later than
___________.
For purposes of provisions of the Lease and the Lease Supplement
related to the creation and enforcement of the Lease and the Lease Supplement
as a security agreement and a fixture filing, Lessee is the debtor and Lessor
is the secured party. The mailing addresses of the debtor (Lessee herein) and
of the secured party (Lessor herein) from which information concerning security
interests hereunder may be obtained are as set forth on the signature pages
hereof. A carbon, photographic or other reproduction of this Memorandum or of
any financing statement related to the Lease and the Lease Supplement shall be
sufficient as a financing statement for any of the purposes referenced herein.
2. TERM, RENEWAL, EXTENSION AND PURCHASE OPTION. The term of the Lease
for the Property ("Term") commenced as of __________, 19__ and shall end as of
_________, 19__, unless the Term is extended or earlier terminated in
accordance with the provisions of the Lease. The Lease contains provisions for
renewal and extension. The tenant has a purchase option under the Lease.
3. TAX PAYER NUMBERS.
Lessor's tax payer number: __________________.
Lessee's tax payer number: __________________.
4. MORTGAGE; POWER OF SALE. Without limiting any other remedies set
forth in the Lease, in the event that a court of competent jurisdiction rules
that the Lease constitutes a mortgage, deed of trust or other secured financing
as is the intent of the parties, then Lessor and Lessee agree that Lessee has
granted, pursuant to the terms of the Lease and the Lease Supplement, a Lien
against the Property WITH POWER OF SALE, and that, upon the occurrence and
during the continuance of any Lease Event of Default, Lessor shall have the
power and authority, to the extent provided by law, after prior notice and
lapse of such time as may be required by law, to foreclose its interest (or
cause such interest to be foreclosed) in all or any part of the Property.
5. EFFECT OF MEMORANDUM. The purpose of this instrument is to give
notice of the Lease and the Lease Supplement and their respective terms,
covenants and conditions to the same extent as if the Lease and the Lease
Supplement were fully set forth herein. This Memorandum shall not modify in any
manner the terms, conditions or intent of the Lease or the Lease Supplement and
the parties agree that this Memorandum is not intended nor shall it be
60
used to interpret the Lease or the Lease Supplement or determine the intent of
the parties under the Lease or the Lease Supplement.
[The remainder of this page has been intentionally left blank.]
61
IN WITNESS WHEREOF, the parties hereto have duly executed this
instrument as of the day and year first written.
LESSOR:
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not individually, but
solely as the Owner Trustee under the
SRI Realty Trust 1998-1, as Lessor
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
First Security Bank, National
Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇. ▇▇▇▇▇
Vice President
LESSEE:
STERILE RECOVERIES, INC.,
as Lessee
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
Sterile Recoveries, Inc.
▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
62
SCHEDULE 1
(Description of Property)
63
[CONFORM TO STATE LAW REQUIREMENTS]
STATE OF )
-----------------
) ss:
COUNTY OF )
----------------
The foregoing Memorandum of Lease Agreement and Lease Supplement No.
_____ was acknowledged before me, the undersigned Notary Public, in the County
of _________________ this _____ day of ______________, by ________________, as
__________________ of FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national
banking association, not individually, but solely as the Owner Trustee under
the SRI Realty Trust 1998-1, on behalf of the Owner Trustee.
[Notarial Seal] --------------------------------------
Notary Public
My commission expires:
---------------
STATE OF )
-----------------
) ss:
COUNTY OF )
----------------
The foregoing Memorandum of Lease Agreement and Lease Supplement No.
_____ was acknowledged before me, the undersigned Notary Public, in the County
of _________________ this _____ day of ______________, by ________________, as
______________________ of STERILE RECOVERIES, INC., a Florida corporation, on
behalf of the corporation.
[Notarial Seal] --------------------------------------
Notary Public
My commission expires:
---------------