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FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the Fiscal Year Ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT
OF 1934 (NO FEE REQUIRED) For the transition period from ____ to ____
Commission File Number 1-9753
GEORGIA GULF CORPORATION
(Exact name of Registrant as specified in its Charter)
Delaware 58-1563799
(State of Incorporation) (I.R.S. Employer Identification No.)
400 Perimeter Center Terrace, Suite 595, Atlanta, Georgia 30346
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (770) 395-4500
Securities registered pursuant to Section 12(b) of the Securities Exchange
Act of 1934:
Title of each class Name of each exchange on which registered
Common Stock, $0.01 par value New York Stock Exchange, Inc.
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. X
Aggregate market value of the voting stock held by nonaffiliates of the
Registrant, computed using the closing price on the New York Stock Exchange
for the Registrant's common stock on March 21, 1996 was $1,360,000,000.
Indicate the number of shares outstanding of the Registrant's common stock
as of the latest practicable date.
Class Outstanding at March 21, 1996
Common Stock, $0.01 par value 36,885,872 shares
DOCUMENTS INCORPORATED BY REFERENCE
(To the Extent Indicated Herein)
1995 Annual Report to Stockholders in Parts II and IV of this Form 10-K.
Proxy Statement for the Annual Meeting of Stockholders to be held on
May 21, 1996 in Part III of this Form 10-K.
TABLE OF CONTENTS
PART I
ITEM PAGE NUMBER
1) Business
General Description of Business 1-2
Electrochemical Products 2-3
Aromatic Chemical Products 3-4
Natural Gas Product 4
Great River Oil & Gas Corporation 4
Georgia-Pacific Contract 5
Marketing 5
Raw Materials 5
Competition 5
Employees 5
Environmental Regulation 6
2) Properties 7
3) Legal Proceedings 8
4) Submission of Matters to a Vote of Security Holders 8
PART II
5) Market Price of and Dividends on the Registrant's Common
Equity and Related Stockholder Matters 8
6) Selected Financial Data 8
7) Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
8) Financial Statements and Supplementary Data 8
9) Changes in and Disagreements With Accountants on
Accounting and Financial Disclosure 8
PART III
10) Directors and Executive Officers of the Registrant 9
11) Executive Compensation 9
12) Security Ownership of Certain Beneficial Owners
and Management 10
13) Certain Relationships and Related Transactions 10
PART IV
14) Exhibits, Financial Statement Schedule and Reports on
Form 8-K 10-13
SIGNATURES
PART I
Item 1. BUSINESS.
General Description of Business
Georgia Gulf Corporation (the "Company") is a leading manufacturer and
marketer of quality chemical and plastic products. The Company's products
are manufactured through two highly integrated lines categorized into
electrochemicals and aromatic chemicals; and also include a third product
line, methanol, a natural gas chemical. The Company's electrochemical
products include chlorine, caustic soda, sodium chlorate, vinyl chloride
monomer ("VCM"), vinyl resins and compounds; the Company's aromatic chemical
products include cumene, phenol and acetone.
The Company has operated as an independent corporation since its
acquisition on December 31, 1984, of a major portion of the business and
assets of the chemical division of Georgia-Pacific Corporation
("Georgia-Pacific"). The Company's operations include production units at
five locations, several marketing organizations responsible for the sale
of the Company's products, a research and development laboratory and a
purchasing organization responsible for the acquisition of all major raw
materials. In most product areas, the Company's marketing program is
supported by an ongoing technical service effort. At the Company's five
manufacturing locations, there are twelve plants, six of which are located at
Plaquemine, Louisiana. The Company also leases storage terminals and
warehouses from which a portion of its products are distributed to customers.
The Company's products are generally intermediate chemicals that are sold
for further processing and use in a wide variety of applications. Some of
the more significant end-use applications include plastic piping, siding and
window frames made from vinyl resins; bonding agents for wood products and
high quality plastics made from phenol; acrylic sheeting for automotive and
architectural products made from acetone; and MBTE, a gasoline additive made
from methanol. The following percentages of sales were made in 1995 to the
manufacturers in the industries listed: 32% housing and construction, 26%
plastics and fibers, 17% solvents and chemicals, 14% consumer products, 6%
pulp and paper and 5% miscellaneous.
In the commodity chemical industry, a company's cost position as well as
the balance of supply and demand in particular product lines significantly
affect earnings and cash flow. Management believes that the Company is
among the lowest cost providers in each of its product lines. In addition,
the Company has invested over $440 million in the past five years to
maintain, expand and/or improve the efficiency of its operating facilities.
Management believes that with its low cost position and integrated product
lines, the Company is well positioned to compete in its various markets.
The Company's major capital projects during 1995 included a rigid vinyl
compound expansion of the plant at Gallman, Mississippi; a product quality
upgrade and expansion of the cumene plant at Pasadena, Texas; and a
modernization and expansion of the VCM plant in Plaquemine, Louisiana. The
Company spends approximately ten percent of its capital budget, before
capital expansion projects, on environmental and safety programs, which has
enabled the Company to continue to meet or exceed various regulatory
standards. The remaining expenditures are typically used to expand,
modernize and/or improve the efficiency of existing facilities.
The major planned capital expenditures for 1996 include the completion of
expansions to the VCM and rigid vinyl compound plants and the completion of
the cumene quality upgrade and expansion project, as well as continuing work
on the expansion of the phenol/acetone plant in Plaquemine, Louisiana,
scheduled for completion in the second quarter of 1997. Also at the
Plaquemine, Louisiana complex, an air separation plant is being constructed
to provide, at considerable savings, required oxygen and nitrogen that are
currently being purchased. This project is scheduled for completion during
the fourth quarter of 1996.
The Company's long-term strategy is to continue to concentrate its efforts
on products and services in the chemical and plastic industries, particular
in its core product areas. These efforts include the continuing investment
in maintaining and improving the Company's low cost position, as well as
selective and prudent capacity additions or expansions that will promote
growth in present and closely related product lines.
Electrochemical Products
Chlorine/Caustic Soda/Sodium Chlorate. The Company's facility at Plaquemine,
Louisiana has the annual capacity to produce 452 thousand tons of chlorine and
501 thousand tons of chlorine's co-product, caustic soda, as well as 27
thousand tons of sodium chlorate.
The major raw materials for these products are salt and electric power. The
Company has a long-term lease on a salt dome near the Plaquemine, Louisiana
facility with sufficient reserves of salt for the foreseeable future. The
lease grants the Company the exclusive use of the salt dome.
Electric power is the most significant cost component in the production of
chlorine, caustic soda and sodium chlorate. The Company's electrical
requirements are currently supplied by Louisiana Power and Light Company
("LP&L"), at rates that recognize the lower cost of supplying a very large,
high load-factor customer. The agreement with LP&L is terminable by the
Company upon six months notice, but is not terminable by LP&L prior to
September 1998.
As a major event in 1995, the Company announced a 250 megawatt
co-generation facility will be constructed at the Plaquemine, Louisiana,
complex which will supply under a long-term lease agreement, essentially all
the electricity and steam requirements for six of the Company's manufacturing
plants. Completion of the co-generation facility is scheduled for the third
quarter of 1997. Management believes the co-generation facility will
significantly reduce electrical costs as well as limit exposure to potential
problems arising from rapidly changing regulatory and rate environments.
Chlorine is used in the production of various chemicals, including those used
to make plastics and vinyl resins. Other applications include water
purification, waste water disinfection, pulp and paper bleaching,
agricultural products, laundry aids and pharmaceuticals. A majority of the
Company's chlorine production is consumed by the Company in the production of
VCM, which is then used to produce vinyl resins. The Company sells the
remaining chlorine principally to the pulp and paper and chemical industries.
The major uses of caustic soda are in the production of pulp and paper,
aluminum, oil, soaps and detergents. Caustic soda also has significant
applications in the production of other chemicals and chemical processes
where caustic soda is used to control pH levels aiding in waste
neutralization. Another use is in the textile industry where it makes
fabrics more absorbent and improves the strength of dyes. Caustic soda is
also used, to a lesser extent, in food processing and electroplating.
Sodium chlorate has major applications in the bleaching process for pulp and
paper. Sodium chlorate is also an ingredient in blasting agents, explosives and
solid rocket fuels.
Vinyl Chloride Monomer. The Company produces VCM at its Plaquemine,
Louisiana complex as the feedstock for the production of vinyl resins. The
major raw materials used in VCM production are purchased ethylene and
Company-produced chlorine. The VCM plant's annual capacity is presently 1.26
billion pounds, which is being expanded to 1.6 billion pounds with the
capability of also producing an additional 400 million pounds of ethylene
dichloride ("EDC"), the intermediate of the manufacture of VCM. The
expansion is scheduled for completion by the 1996 fourth quarter. A majority
of the VCM production in 1995 was used by the Company's vinyl resins
operations with the remainder being sold to other vinyl resins producers,
particularly in the export market.
Vinyl Suspension Resins. The Company operates a vinyl suspension resins
plant at Plaquemine, Louisiana. The plant is located adjacent to its major
raw material supplier, the Company's VCM facility, thereby minimizing
transportation and handling costs. The annual production capacity is 1.12
billion pounds, of which approximately one-fourth is used internally to
produce rigid vinyl compounds.
Vinyl suspension resins are one of the most widely used plastics in the
world today. After being formulated to desired properties, vinyl resins are
heated and shaped into finished products by various extrusion, calendaring and
molding processes. Applications are diverse and include pipe, window frames,
siding, flooring, shower curtains, packaging, bottles, film, medical tubing
and business machine housings. These vinyl resins are also important to the
automotive industry for use in seats, trim, floormats and vinyl tops.
Vinyl Emulsion Resins. The Company's Delaware City, Delaware facility
produces special purpose vinyl emulsion resins with an annual capacity of 48
million pounds. Vinyl emulsion resins, once compounded, are generally
semi-liquid and are processed with heat. All sales of vinyl emulsion resins
are to outside customers. Typical applications include filter gaskets,
battery separators, caulking compounds, sealants, surgical gloves, bottle cap
liners and squeeze toys.
Subsequent to December 31, 1995, the Company entered into an agreement to
sell its vinyl emulsion business, including the property and buildings at the
Delaware City location. The Company will continue to produce rigid vinyl
compounds at the Delaware City facility for a period of time. Closing of the
sale is contingent upon customary conditions. Assuming the consummation of
the sale, neither the proceeds or gain from the sale of the vinyl emulsion
business are expected to be material.
Rigid Vinyl Compounds. The Company's rigid vinyl compounding plants, had
an aggregate annual capacity of 290 million pounds for 1995, and are located
in Gallman, Mississippi; Delaware City, Delaware; and Tiptonville, Tennessee.
During the first half of 1996, the Company will start-up an 80 million pound
rigid vinyl compound expansion at the Gallman, Mississippi facility, which
has not been included in the stated annual capacity for 1995. A second phase
of the expansion, which includes 88 million pounds of additional capacity,
will be brought on-line as the market dictates. Rigid vinyl compound
production of approximately 80 million pounds at the Delaware City, Delaware
facility will be phased out as a result of the sale of that facility and the
majority of the rigid vinyl compound production will be transferred to the
lower cost Gallman plant.
Rigid vinyl compounds are formulated to provide specific end-use
properties that allow the material to be thermoformed directly into a
finished product. All sales of rigid vinyl compounds are to outside
customers. The product line can be segregated into three major product areas
according to the following fabrication methods:
Blow Molding -- The Company is a supplier of blow molding compounds,
which are primarily used for both food-grade and general purpose
bottles. Supplied in both clear and opaque colors, the materials
are used to package edible oils, cosmetics, shampoos, charcoal
lighter fluid and bottled water.
Injection Molding -- The Company supplies compounds used in the
business machine market for computer housings and keyboards. It also
supplies compounds to produce electrical outlet boxes. These
proprietary compounds, with extensive approval procedures by
customers or regulatory bodies, are sold to some of the leading
international producers of injection molded products. The Company
also manufactures compounds for use in pipe and furniture fittings.
Profile Extrusion -- The Company supplies profile extrusion markets,
which have applications in window and furniture profiles and extruded
sheets for household fixtures and decorative overlays. Profile
extrusions are an end-product for both pelletized and powder compounds.
Aromatic Chemical Products
Cumene. Cumene is produced at the Company's Pasadena, Texas facility
located on the Houston ship channel. The Company's cumene plant, the world's
largest, has an annual stated capacity of 1.42 billion pounds, which is
presently being expanded to 1.5 billion pounds. The expansion, due for
completion during the second quarter of 1996, includes a modernization of
technology, which will reduce overall manufacturing cost and increase
effective annual capacity by 300 million pounds. Cumene is produced from
benzene and propylene, which are purchased from various suppliers from the
numerous petroleum complexes located in the surrounding area. A large
portion of the Company's 1995 cumene output was consumed internally in the
production of phenol and its co-product acetone.
Phenol/Acetone. Phenol and acetone are produced at the Company's
Plaquemine, Louisiana facility which has 440 million pounds of annual phenol
capacity and 270 million pounds of annual acetone capacity, as well as at the
Pasadena, Texas, facility where annual capacity is 160 million pounds of
phenol and 100 million pounds of acetone. The Plaquemine, Louisiana
phenol/acetone plant is in the process of being expanded, which will add 60
million pounds of phenol and 36 million pounds of acetone, bringing name
plate capacity for the plant to 500 and 406 million pounds, respectively.
Phenol is a major ingredient in phenolic resins, which are used
extensively as bonding agents and adhesives for wood products such as plywood
and granulated wood panels, as well as in insulation, electrical parts, nylon
carpeting, oil additives and pharmaceuticals. Phenol is also a precursor to
high performance plastics used in automobiles, household appliances,
electronics and protective coating applications.
The largest uses for acetone are as a key ingredient to methyl
methacrylate, which is used to produce acrylic sheeting, and as an ingredient
for surface coating resins for automotive and architectural markets. Acetone
is also an intermediate for the production of engineering plastics and
several major industrial solvents. Other uses range from wash solvents for
automotive and industrial applications to pharmaceutical and cosmetics.
As a result of the phenol/acetone manufacturing process, the Company also
produces small amounts of a by-product, alpha-methylstyrene ("AMS"), which is
primarily used as a polymer modifier and as a chemical intermediate.
Natural Gas Product
Methanol. Methanol is produced at the Company's facility at Plaquemine,
Louisiana which has an annual capacity of 160 million gallons. Natural gas
represents the majority of the cost of methanol. The Plaquemine facility is
located in the center of Louisiana's oil and gas producing region and has
three separate pipeline systems delivering gas to the plant. The natural gas
is purchased by the Company under contracts at market prices from both producers
and gas pipeline suppliers.
A key use for methanol is in the production of methyl tertiary-butyl ether,
or MTBE, an additive that promotes cleaner burning gasoline by adding oxygen.
Methanol is also used as a raw material in the manufacture of formaldehyde,
which is an ingredient in bonding agents for building materials such as
granulated wood panels and plywood. Other applications for methanol include
windshield washer fluid, solvents, and components of acrylic sheeting,
coatings, fibers and household adhesives.
Great River Oil & Gas Corporation
The Company owns Great River Oil & Gas Corporation, a small oil and gas
exploration company with activities centered in southern Louisiana. This
subsidiary enhances the reliability of a small portion of the natural gas
requirements at the Company's Plaquemine, Louisiana complex.
Georgia-Pacific Contract
The Company has supply contracts, subject to certain limitations, for a
substantial percentage of Georgia-Pacific's requirements for certain
chemicals at market prices. These supply contracts have various expiration
dates (depending on the product) from 1996 through 1999 and may be extended
year-to-year upon expiration. The sales to Georgia-Pacific under these
supply contracts for the years ended December 31, 1995, 1994 and 1993 amounted
to approximately 14%, 15% and 15% of the Company's sales, respectively.
Marketing
The Company markets its products primarily to industrial customers
throughout the United States and also internationally. The Company's
products are sold by its sales force, which is organized by product line.
The sales organization, which is located predominantly in the southeastern
and midwestern United States, is supported by the Company's technical service
staff.
The Company's marketing program has been aimed at expanding and
diversifying its customer base both domestically and internationally. Other
than Georgia-Pacific, no single customer represents more than 10% of the
Company's net sales. Export sales accounted for approximately 15%, 13% and
14% of the Company's net sales for the years ended December 31, 1995, 1994
and 1993, respectively. The principal international markets served by the
Company include Canada, Mexico, Central and South America, Europe and Asia.
Raw Materials
The most important raw materials purchased by the Company are salt,
electricity, ethylene, benzene, propylene and natural gas. Raw materials
used for production of the Company's products are usually purchased from
various suppliers under supply contracts. Since raw materials account for a
significant portion of the Company's total production costs, the Company's
ability to pass on increases in these costs to its customers has a
significant impact on operating results which is, to a large extent, related
to market conditions. Management believes the Company has a reliable supply
base of raw materials under normal market conditions. The impact of any
future raw material shortages cannot be accurately predicted.
Competition
The Company experiences competition from numerous manufacturers in all of
its product lines. In some product areas, the Company's competitors have
substantially greater financial resources and are more highly diversified
than the Company. The Company competes on a variety of factors such as
price, product quality, delivery and technical service.
Management believes that the Company is well-positioned to compete as a
result of integrated product lines, the operational efficiency of its plants
and the location of its facilities near major water and rail transportation
terminals.
Employees
As of December 31, 1995, the Company had 1,143 full-time employees.
The Company has one collective bargaining agreement, which covered 55
employees at the Tiptonville, Tennessee, facility as of December 31, 1995.
Environmental Regulation
The Company's operations are subject to various federal, state and local
laws and regulations relating to environmental quality. These regulations,
which are enforced principally by the United States Environmental Protection
Agency and comparable state agencies, govern the management of solid and
hazardous waste; emissions into the air and discharges into surface and
underground waters; and the manufacture of chemical substances. All of the
plants operated by the Company meet current environmental standards.
Management believes that the Company is in material compliance with all
current environmental laws and regulations. The Company estimates that any
expenses incurred in maintaining compliance with these requirements will
not materially affect earnings or cause the Company to exceed its level of
anticipated capital expenditures. However, there can be no assurance that
regulatory requirements will not change, and therefore, it is not possible to
accurately predict the aggregate cost of compliance resulting from any such
changes.
Item 2. PROPERTIES
The Company's asset base was established from 1971 to the present with
construction of the Plaquemine, Louisiana, complex, the construction of the
Pasadena, Texas, cumene plant; the purchase of the three vinyl resin and/or
compound plants and the purchase of the Bound Brook, New Jersey,
phenol/acetone facility subsequently relocated to Pasadena, Texas, and
modernized in 1990. Subsequent to December 31, 1995, the Company entered
into an agreement to sell its vinyl emulsion business including the property
and buildings at the Delaware City location as described in Item 1 of this
Form 10-K. The Company continues to explore ways to expand both its plant
capacities and product lines. The Company believes current and additional
planned capacity will adequately meet anticipated demand requirements. The
average capacity utilization of the Company's production facilities in 1995
was 94%.
The following table sets forth the location of each chemical manufacturing
facility owned by the Company, the products manufactured at each facility and
the approximate processing capability of each, assuming normal plant
operation, as of December 31, 1995:
Locations Products Annual Capacity
Delaware City, DE Vinyl Emulsion Resins, in million pounds 48
Delaware City, DE Rigid Vinyl Compounds, in million pounds (1) 290
Gallman, MS
Tiptonville, TN
Pasadena, TX Cumene, in billion pounds (2) 1.42
Phenol, in million pounds 160
Acetone, in million pounds 100
Plaquemine, LA Chlorine, in thousand tons 452
Caustic Soda, in thousand tons 501
Sodium Chlorate, in thousand tons 27
Vinyl Chloride Monomer, in billion pounds (2) 1.26
Vinyl Suspension Resins, in billion pounds 1.12
Phenol, in million pounds (2) 440
Acetone, in million pounds (2) 270
Methanol, in million gallons 160
(1) Rigid vinyl compounds production capacity will be changing during
1996 as discussed in Item 1 of this Form 10-K.
(2) Production capacity is being expanded as discussed in Item 1 of this
Form 10-K.
The Company's manufacturing facilities are located near major water and
rail transportation terminals facilitating efficient delivery of raw
materials and prompt shipment of finished products. In addition, the Company
has a fleet of 2,430 railcars of which 756 are owned and the remainder leased
pursuant to operating leases with varying terms through the year 2010. The
total lease expense for the Company's railcars and other transportation
equipment was approximately $9,903,000 for 1995.
The Company leases office space for its principal executive offices in
Atlanta, Georgia. The Company also leases office space for information
services in Baton Rouge, Louisiana; and for sales and marketing offices in
Houston, Texas; Schaumburg, Illinois; and Lawrenceville, New Jersey; as well
as numerous storage terminals located throughout the United States.
Item 3. LEGAL PROCEEDINGS.
The Company is subject to claims and legal actions that arise in the
ordinary course of its business. Management believes that the ultimate
liability, if any, with respect to these claims and legal actions will not
have a material effect on the financial position or on the results of
operations of the Company.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matters were submitted to a vote of security holders during the fourth
quarter of 1995.
PART II
Item 5. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS.
The information set forth under the captions "Corporate Information
- --Common Stock Data" and Notes 5, 6, 7 and 13 of the "Notes to Consolidated
Financial Statements" of the Company's 1995 Annual Report to Stockholders is
hereby incorporated by reference herein in response to this item.
Item 6. SELECTED FINANCIAL DATA.
The information set forth under the caption "Ten-Year Selected Financial
Data" of the Company's 1995 Annual Report to Stockholders is hereby
incorporated by reference herein in response to this item.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
The information set forth under the caption "Management's Discussion and
Analysis" of the Company's 1995 Annual Report to Stockholders is hereby
incorporated by reference herein in response to this item.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The information set forth on pages 19 through 33 of the Company's 1995
Annual Report to Stockholders is hereby incorporated by reference herein in
response to this item.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
The Company has not changed its independent public accountants and has had
no disagreements with its independent public accountants on accounting and
financial disclosure during the Registrant's two most recent fiscal years
prior to, or in any period subsequent to, the date of the most recent
financial statements included herein.
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The information set forth under the caption "Election of Directors" in the
Company's Proxy Statement for the Annual Meeting of Stockholders to be held
May 21, 1996, is hereby incorporated by reference in response to this item.
The following is certain information regarding the executive officers of
the Company who are not Directors:
Richard B. Marchese, 54, has served as Vice President --Finance,
Chief Financial Officer and Treasurer of the Company since
May 1989, and prior thereto served as Corporate Controller from
its inception.
Thomas G. Swanson, 54, has served as Vice President -- Supply and
Corporate Development since August 1993. Mr. Swanson served as
Vice President -- Commodity Chemicals Group from December 1989 to
August 1993; as General Manager -- Commodity Chemicals Group from
November 1988 until December 1989; and prior thereto as Director
of Corporate Development for the Company from July 1987. Prior
thereto, Mr. Swanson was Manager -- Supply and Distribution for
the Company since its inception.
Mark J. Seal, 44, has served as Vice President -- Polymer Group
since August 1993. Mr. Seal served as Business and Manufacturing
Director -- Vinyl Resins from May 1992 until August 1993 and as
Business Manager PVC Resins and Compounds from May 1989 until
May 1992. Prior thereto, Mr. Seal served as Business Manager --
Electrochemicals from January 1987 until May 1989 and as Midwest
Regional Sales Manager for the Company from its inception until
January 1987.
Gary L. Elliott, 51, has served as Vice President -- Marketing and
Sales Commodity Chemicals Group since August 1993. Mr. Elliott
served as Business Manager -- Electrochemicals and Midwest
Regional Sales Manager from June 1989 until August 1993. Prior
thereto, Mr. Elliott served as Northeast Regional Sales Manager
from May 1987 until June 1989; as VCM Product Manager from
November 1985 to May 1987; and as a Sales Representative for the
Company from its inception until November 1985.
Edward A. Schmitt, 49, has served as Vice President -- Operations
Commodity Chemicals Group since August 1993. Mr. Schmitt served
as General Manager -- Chemical Operations from March 1992 until
August 1993; as General Manager -- Plaquemine Division from May
1989 until March 1992; and as Plant Manager - Plaquemine Division
from February 1988 until May 1989. Prior thereto, Mr. Schmitt
served as Manufacturing Manager from October 1985 until
February 1988 and as VCM Production Manager for the Company from
its inception until October 1985.
Joel I. Beerman, 46, has served as Vice President, General Counsel
and Secretary since February 1994 and as General Counsel since
February 1992. Prior thereto, Mr. Beerman served as Associate
General Counsel for the Company since its inception.
Executive officers are elected by, and serve at the pleasure of, the
Board of Directors.
Item 11. EXECUTIVE COMPENSATION.
The information set forth under the captions "Election of Directors" and
"Executive Compensation" in the Company's Proxy Statement for the Annual
Meeting of Stockholders to be held on May 21, 1996, is hereby incorporated
by reference in response to this item.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The information set forth under the captions "Principal Stockholders"
and "Security Ownership of Management" in the Company's Proxy Statement for
the Annual Meeting of Stockholders to be held on May 21, 1996, is hereby
incorporated by reference in response to this item.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The Company has not had any transactions required to be reported under this
item for the calendar year 1995, or for the period from January 1, 1996 to the
date of this report.
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
(a) The following documents are filed as a part of this 1995 Annual
Report for Georgia Gulf Corporation:
(1) The Consolidated Financial Statements, the Notes to Consolidated
Financial Statements, the Report of Management and the Report of
Independent Public Accountants listed below are incorporated
herein by reference from pages 19 through 33 of the Company's
1995 Annual Report to Stockholders:
Consolidated Balance Sheets as of December 31, 1995 and 1994
Consolidated Statements of Income for the years ended
December 31, 1995, 1994 and 1993
Consolidated Statements of Cash Flows for the years ended
December 31, 1995, 1994 and 1993
Consolidated Statements of Changes in Stockholders' Equity
(Deficit) for the years ended December 31, 1995, 1994 and 1993
Notes to Consolidated Financial Statements
Report of Management
Report of Independent Public Accountants.
(2) Financial Statement Schedules:
Report of Independent Public Accountants on Financial Statement
Schedule
The following financial statement schedule is for the years ended
December 31, 1995, 1994 and 1993:
II Valuation and Qualifying Accounts
Schedules other than the one listed above are omitted because they
are not required and are inapplicable or the information is
otherwise shown in the Consolidated Financial Statements or notes
thereto.
(3) Exhibits. Each management contract or compensatory plan or
arrangement is preceded by an asterisk.
The following exhibits are filed as part of this Form 10-K Annual Report:
EXHIBIT
NO. DESCRIPTION
The following exhibits relate to the Company's operating lease
agreement for its co-generation project:
10(a) Trust Agreement dated February 6, 1996, between NationsBanc
Leasing Corporation of North Carolina and First Security Bank
of Utah, N.A.
10(b) Leasehold Mortgage, Assignment of Leases, Security Agreement
and Financing Statement dated February 16, 1996, between the
Company, First Security Bank of Utah, N.A., and Val T. Orton.
10(c) Participation Agreement dated February 6, 1996, between the
Company, First Security Bank of Utah, N.A., NationsBanc
Leasing Corporation of North Carolina, NationsBank, N.A.
(South), ABN AMRO Bank N.V., Bank of Montreal, Bank of New
York, Bank of Nova Scotia, Bank of Tokyo Trust Company,
Chase Manhattan Bank, The Dai-Ichi Kangyo Bank, Limited,
Atlanta Agency, The Fuji Bank, Ltd., The Industrial Bank of
Japan, Limited, the Sakura Bank Limited, Atlanta Agency,
Rabobank Nederland, New York Branch, The Tokai Bank,
Limited, Atlanta Agency, Wachovia Bank of Georgia, N.A., and
Val T. Orton.
10(d) Lease Agreement (Tax Retention Operating Lease) dated February
6, 1996, between the Company and First Security Bank of
Utah, N.A.
10(e) Credit Agreement dated February 6, 1996, between First
Security Bank of Utah, N.A. and NationsBank, N.A. (South).
10(f) Security Agreement dated February 6, 1996, between First
Security Bank of Utah, N.A., Val T. Orton, NationsBank,
N.A. (South), and NationsBanc Leasing Corporation of North
Carolina.
10(g) Ground Lease Agreement dated February 16, 1996, between the
Company and First Security Bank of Utah, N.A.
13 1995 Annual Report to Stockholders
23 Consent of Independent Public Accountants
The following exhibit is incorporated herein by reference to the Company's Form
S-8 (File No. 33-64749) filed December 5, 1995:
EXHIBIT
NO. DESCRIPTION
10 Georgia Gulf Corporation Employee Stock Purchase Plan
The following exhibit is incorporated herein by reference to the Company's
Form S-3 (File No. 33-63051) filed September 28, 1995:
EXHIBIT
NO. DESCRIPTION
4 Indenture, dated as of November 15, 1995, between the Company
and LaSalle National Bank, as trustee (including form of
Notes).
The following exhibits are incorporated by reference to the Company's 1995 Form
10-Q Quarterly Report for the period ending June 30, 1995, filed August 2, 1995.
EXHIBIT
NO. DESCRIPTION
10(i) Receivables Transfer Agreement dated May 12, 1995, between the
Company, as Transferor, and Dynamic Funding Corporation.
10(ii) Term Loan Agreement dated June 29, 1995, between the Company and
The Industrial Bank of Japan, Limited as Administrative Agent.
The following exhibit is incorporated by reference to the Company's 1995 Form
10-Q Quarterly Report for the period ending March 31, 1995, filed May 15, 1995.
EXHIBIT
NO. DESCRIPTION
10 Credit Agreement, dated March 30, 1995, between the Company and The
Chase Manhattan Bank (National Association) as Administrative
Agent.
The following exhibits are incorporated herein by reference to the Company's
1991 Form 10-K Annual Report filed March 30, 1992.
EXHIBIT
NO. DESCRIPTION
3(a) Certificate of Amendment of Certificate of Incorporation
3(b) Amended and Restated By-Laws
*10 Georgia Gulf Corporation 1990 Incentive Equity Plan
22 Subsidiaries of the Registrant
The following exhibit is incorporated herein by reference to Exhibit 2 to the
Company's Registration Statement on Form 8-A filed May 11, 1990, as amended:
EXHIBIT
NO. DESCRIPTION
4 Amended and Restated Rights Agreement effective as of
August 31, 1990
The following exhibits are incorporated herein by reference to the Company's
Registration Statement on Form S-1 (file No. 33-9902) declared effective on
December 17, 1986:
EXHIBIT
NO. DESCRIPTION
3(a) Certificate of Agreement of Merger, with Certificate of
Incorporation of Company as Exhibit A thereto, dated
December 31, 1984, and amendments thereto
10(e) Stock Purchase Agreement between the Company and Georgia-Pacific
dated December 31, 1984, and Letter re: Stock Purchase
Agreement dated December 31, 1984
10(f) Chemical Sales Agreement between the Company and Georgia-Pacific
dated December 31, 1984 and Letter re: Chemical Sales Agreement
dated December 31, 1984
10(g) Agreement re: Liabilities among Georgia-Pacific, Georgia-Pacific
Chemicals, Inc. and others dated December 31, 1984
10(o) Georgia Gulf Savings and Capital Growth Plan
10(p) Georgia Gulf Salaried Employees Retirement Plan
10(q) Georgia Gulf Hourly Employees Retirement Plan
*10(u) Executive Retirement Agreements
10(v) Salt Contract
(b) Reports on Form 8-K
No report on Form 8-K was filed with the Securities and Exchange
Commission during the last quarter of 1995.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
GEORGIA GULF CORPORATION
(Registrant)
Date: March 28, 1996 By: /s/ Jerry R. Satrum
Jerry R. Satrum, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
/s/ Jerry R. Satrum
Jerry R. Satrum President, Chief Executive March 28, 1996
Officer and Director
(Principal Executive Officer)
/s/ Richard B. Marchese
Richard B. Marchese Vice President - Finance, March 28, 1996
Chief Financial Officer and
Treasurer (Principal
Financial and Accounting Officer)
/s/ James R. Kuse
James R. Kuse Chairman of the Board and March 28, 1996
Director
/s/ John D. Bryan
John D. Bryan Director March 28, 1996
/s/ Dennis M. Chorba
Dennis M. Chorba Director March 28, 1996
/s/ Alfred C. Eckert III
Alfred C. Eckert III Director March 28, 1996
/s/ Robert E. Flowerree
Robert E. Flowerree Director March 28, 1996
/s/ Holcombe T. Green, Jr.
Holcombe T. Green, Jr. Director March 28, 1996
/s/ Edward S. Smith
Edward S. Smith Director March 28, 1996
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON
FINANCIAL STATEMENT SCHEDULE
To Georgia Gulf Corporation:
We have audited in accordance with generally accepted auditing standards,
the financial statements included in Georgia Gulf Corporation's Annual Report
to Stockholders incorporated by reference in this Form 10-K, and have issued
our report thereon dated February 15, 1996. Our audit was made for the
purpose of forming an opinion on those statements taken as a whole. The
schedule listed in Item 14 of this Form 10-K is the responsibility of the
Company's management and is presented for purposes of complying with the
Securities and Exchange Commission's rules and is not part of the basic
financial statements. This schedule has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, fairly states in all material respects the financial data required to
be set forth therein in relation to the basic financial statements taken as a
whole.
ARTHUR ANDERSEN LLP
Atlanta, Georgia
February 15, 1996
GEORGIA GULF CORPORATION AND SUBSIDIARIES
SCHEDULE II --- VALUATION AND QUALIFYING ACCOUNTS
(Dollars in thousands)
Additions
Charged
Balance at Charged to to other Balance at
beginning costs and accounts-- Deductions end of
Description of period expenses describe --describe period
1993
Allowance for
doubtful accounts $3,200 $1,900 $ --- $(1,900) (1) $3,200
1994
Allowance for
doubtful accounts $3,200 $1,800 $ --- $(2,600) (1) $2,400
1995
Allowance for
doubtful accounts $2,400 $ 1,000 $ --- $(1,000) (1) $2,400
NOTES:
(1) Accounts receivable balances written off during the period.
INDEX TO EXHIBITS
EXHIBIT
NO. DESCRIPTION PAGE (1)
10(a) Trust Agreement dated February 6, 1996, between
NationsBanc Leasing Corporation of North Carolina
and First Security Bank of Utah, N.A. . . . . . . ___
10(b) Leasehold Mortgage, Assignment of Leases, Security
Agreement and Financing Statement dated
February 16, 1996, between the Company, First Security
Bank of Utah, N.A., and Val T. Orton. . . . . . . ___
10(c) Participation Agreement dated February 6, 1996,
between the Company, First Security Bank of Utah, N.A.,
NationsBanc Leasing Corporation of North Carolina,
NationsBank, N.A. (South), ABN AMRO Bank N.V., Bank
of Montreal, Bank of New York, Bank of Nova Scotia,
Bank of Tokyo Trust Company, Chase Manhattan Bank,
The Dai-Ichi Kangyo Bank, Limited, Atlanta Agency,
The Fuji Bank, Ltd., The Industrial Bank of Japan,
Limited, the Sakura Bank Limited, Atlanta Agency,
Rabobank Nederland, New York Branch, The Tokai Bank,
Limited, Atlanta Agency, Wachovia Bank of Georgia,
N.A., and Val T. Orton. . . . . . . . . . . . . . ___
10(d) Lease Agreement (Tax Retention Operating Lease)
dated February 6, 1996, between the Company and
First Security Bank of Utah, N.A. . . . . . . . . ___
10(e) Credit Agreement dated February 6, 1996, between
First Security Bank of Utah, N.A. and NationsBank,
N.A. (South). . . . . . . . . . . . . . . . . . . ___
10(f) Security Agreement dated February 6, 1996, between
First Security Bank of Utah, N.A., Val T. Orton,
NationsBank, N.A. (South), and NationsBanc
Leasing Corporation of North Carolina. . . . . . ___
10(g) Ground Lease Agreement dated February 16, 1996,
between the Company and First Security Bank of
Utah, N.A. . . . . . . . . . . . . . . . . . . . ___
13 1995 Annual Report to Stockholders . . . . . . . ___
23 Consent of Independent Public Accountants . . . . ___
(1) Page numbers appear on the manually signed Form 10-K's only.
EXHIBIT 10(a)
TRUST AGREEMENT
dated as of February 6, 1996
among
NATIONSBANC LEASING CORPORATION OF NORTH CAROLINA,
as the Holder,
and
FIRST SECURITY BANK OF UTAH, N.A.,
as Owner Trustee
GGC TRUST 1996-1
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS
SECTION 1.1 Definitions. . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.2 Interpretation.. . . . . . . . . . . . . . . . . . . . 1
ARTICLE II AUTHORITY TO EXECUTE AND PERFORM VARIOUS DOCUMENTS;
DECLARATION OF TRUST BY TRUST COMPANY
SECTION 2.1 Authority To Execute and Perform Various Documents.. . 2
SECTION 2.2 Declaration of Trust by Trust Company. . . . . . . . . 2
ARTICLE III CONTRIBUTIONS AND PAYMENTS
SECTION 3.1 Procedure for Holder Fundings; Certificates. . . . . . 3
SECTION 3.2 Certificate Yield. . . . . . . . . . . . . . . . . . . 4
SECTION 3.3 Scheduled Return of Holder Fundings. . . . . . . . . . 4
SECTION 3.4 Early Return of Holder Fundings. . . . . . . . . . . . 4
SECTION 3.5 Payments from Trust Estate Only. . . . . . . . . . . . 5
SECTION 3.6 Method of Payment. . . . . . . . . . . . . . . . . . . 5
SECTION 3.7 Computation of Yield . . . . . . . . . . . . . . . . . 5
SECTION 3.8 Conversion and Continuation Options. . . . . . . . . . 6
SECTION 3.9 Increased Costs, Illegality, etc . . . . . . . . . . . 6
SECTION 3.10 Contribution Indemnity . . . . . . . . . . . . . . . . 8
SECTION 3.11 Notice of Amounts Payable. . . . . . . . . . . . . . . 8
ARTICLE IV COLLECTIONS AND DISTRIBUTIONS
SECTION 4.1 Collections and Remittances by the Owner Trustee . . . 9
SECTION 4.2 Priority of Distributions. . . . . . . . . . . . . . 10
SECTION 4.3 Holder Excepted Payments . . . . . . . . . . . . . . 10
SECTION 4.4 Distributions after Default. . . . . . . . . . . . . 10
ARTICLE V DUTIES OF THE OWNER TRUSTEE
SECTION 5.1 Notice of Certain Events . . . . . . . . . . . . . . 10
SECTION 5.2 Action Upon Instructions . . . . . . . . . . . . . . 11
SECTION 5.3 Indemnification. . . . . . . . . . . . . . . . . . . 11
SECTION 5.4 No Duties Except as Specified In Trust Agreement or
Instructions . . . . . . . . . . . . . . . . . . . . 11
SECTION 5.5 No Action Except Under Specified Documents or
Instructions . . . . . . . . . . . . . . . . . . . . 12
SECTION 5.6 Absence of Duties. . . . . . . . . . . . . . . . . . 12
ARTICLE VI THE OWNER TRUSTEE
SECTION 6.1 Acceptance of Trust and Duties . . . . . . . . . . . 12
SECTION 6.2 Furnishing of Documents. . . . . . . . . . . . . . . 13
SECTION 6.3 No Representations or Warranties as to the Facility
or Operative Agreements. . . . . . . . . . . . . . . 13
SECTION 6.4 No Segregation of Moneys; No Interest. . . . . . . . 13
SECTION 6.5 Reliance; Advice of Counsel. . . . . . . . . . . . . 13
SECTION 6.6 Liability With Respect to Documents. . . . . . . . . 14
SECTION 6.7 Not Acting In Individual Capacity. . . . . . . . . . 14
SECTION 6.8 Books and Records; Tax Returns . . . . . . . . . . . 14
SECTION 6.9 Substitute Owner Trustee; Owner Trustee Advisor. . . 15
ARTICLE VII INDEMNIFICATION OF THE OWNER TRUSTEE
SECTION 7.1 Indemnification Generally. . . . . . . . . . . . . . 15
SECTION 7.2 Compensation and Expenses. . . . . . . . . . . . . . 16
ARTICLE VIII TERMINATION OF TRUST AGREEMENT
SECTION 8.1 Termination of Trust Agreement . . . . . . . . . . . 16
SECTION 8.2 Termination at Option of the Holder. . . . . . . . . 16
SECTION 8.3 Termination at Option of the Owner Trustee . . . . . 16
SECTION 8.4 Actions by the Owner Trustee Upon Termination. . . . 17
ARTICLE IX SUCCESSOR OWNER TRUSTEES, CO-OWNER TRUSTEES AND SEPARATE
OWNER TRUSTEES
SECTION 9.1 Resignation of the Owner Trustee; Appointment of
Successor . . . . . . . . . . . . . . . . . . . . . 17
SECTION 9.2 Co-Trustees and Separate Trustees. . . . . . . . . . 18
SECTION 9.3 Notice . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE X SUPPLEMENTS AND AMENDMENTS
SECTION 10.1 Supplements and Amendments . . . . . . . . . . . . . 21
SECTION 10.2 Limitation on Amendments . . . . . . . . . . . . . . 21
ARTICLE XI MISCELLANEOUS
SECTION 11.1 No Legal Title to Trust Estate in the Holder . . . . 21
SECTION 11.2 Sale of the Facility by the Owner Trustee is Binding 21
SECTION 11.3 Limitations on Rights of Others. . . . . . . . . . . 22
SECTION 11.4 Notices. . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 11.5 Severability . . . . . . . . . . . . . . . . . . . . 22
SECTION 11.6 Limitation on the Holder's Liability . . . . . . . . 22
SECTION 11.7 Separate Counterparts; Dating. . . . . . . . . . . . 22
SECTION 11.8 Successors and Assigns . . . . . . . . . . . . . . . 22
SECTION 11.9 Headings . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 11.10 Governing Law. . . . . . . . . . . . . . . . . . . . 23
SECTION 11.11 Performance by the Holder. . . . . . . . . . . . . . 23
SECTION 11.12 Conflict with Operative Agreements . . . . . . . . . 23
SECTION 11.13 No Implied Waiver. . . . . . . . . . . . . . . . . . 23
TRUST AGREEMENT
THIS TRUST AGREEMENT, dated as of February 6, 1996, is between
NATIONSBANC LEASING CORPORATION OF NORTH CAROLINA, a North Carolina
corporation (the "Holder"), and FIRST SECURITY BANK OF UTAH, N.A., in its
individual capacity ("Trust Company"), and in its capacity as owner trustee
hereunder, together with its successors and assigns (the "Owner Trustee").
WHEREAS, in order to provide a portion of the funds for carrying out
the other transactions contemplated by the Operative Agreements, the Holder
will fund Holder Fundings pursuant to this Trust Agreement and the
Participation Agreement (as defined below);
WHEREAS, the Holder desires to form the Trust created hereby for the
purpose of developing, acquiring, installing, constructing and testing the
Facility and all components thereof and for carrying out certain transactions
contemplated by the Operative Agreements; and
WHEREAS, Trust Company is willing to act as trustee hereunder and to
accept the trust created hereby (the "Trust").
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained and of other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions. For purposes of this Trust Agreement
(including the "WHEREAS" clauses set forth above), capitalized terms used in
this Trust Agreement and not otherwise defined herein shall have the meanings
assigned to them in Appendix A to that certain Participation Agreement, dated
as of February 6, 1996 (the "Participation Agreement"), among Georgia Gulf
Corporation, the Owner Trustee, the Holder, the various banks and other
lending institutions which are Lenders thereunder from time to time
(individually, a "Lender" and collectively, the "Lenders") and NationsBank,
N.A. (South), as Administrative Agent for the Lenders. Unless otherwise
indicated, references in this Trust Agreement to articles, sections,
paragraphs, clauses, appendices, schedules and exhibits are to the same
contained in this Trust Agreement.
SECTION 1.2 Interpretation. The rules of usage set forth in Appendix
A to the Participation Agreement shall apply to this Trust Agreement.
ARTICLE II
AUTHORITY TO EXECUTE AND PERFORM VARIOUS DOCUMENTS;
DECLARATION OF TRUST BY TRUST COMPANY
SECTION 2.1 Authority To Execute and Perform Various Documents. The
Holder hereby authorizes and directs the Owner Trustee (i) to execute and
deliver, as trustee for and on behalf of the Holder, each Operative Agreement
to which the Owner Trustee is a party and any other agreements, instruments,
certificates or documents related to the transactions contemplated hereby to
which the Owner Trustee is a party, (ii) to take whatever action shall be
required to be taken by the Owner Trustee by the terms of, and exercise its
rights and perform its duties under, each of the documents, agreements,
instruments and certificates referred to in clause (i) above as set forth in
such documents, agreements and certificates, and (iii) subject to the terms
of this Trust Agreement, to take such other action in connection with the
foregoing as the Holder may from time to time direct.
SECTION 2.2 Declaration of Trust by Trust Company.
(a) Trust Company hereby declares that it will hold all estate,
right, title and interest of the Owner Trustee in and to the
Facility, each Holder Funding, the Operative Agreements and any other
property contributed by the Holder, including, without limitation, all
amounts of Rent, insurance proceeds and condemnation awards, indemnity
or other payments of any kind (collectively, the "Trust Estate") as
Owner Trustee upon the trusts set forth herein and for the use and
benefit of the Holder, subject, however, to the provisions of the
Credit Agreement and the Security Documents. The name of the Trust
shall be "GGC Trust 1996-1".
(b) The purpose of the Trust is to hold title to the Trust Estate
for the benefit of the Holder and to engage in activities ancillary and
incidental thereto as the Holder shall determine to be desirable.
Except in connection with the foregoing, the Owner Trustee shall not
(i) engage in any business activity, (ii) have any property, rights or
interest, whether real or personal, tangible or intangible, (iii) incur
any legal liability or obligation, whether fixed or contingent,
matured or unmatured, other than in the normal course of the
administration of the Trust or (iv) subject any of its property or
assets to any mortgage, Lien, security interest or other claim or
encumbrance, other than in favor of the Lenders or the Holder
pursuant to the provisions of the Operative Agreements and this Trust
Agreement. THIS TRUST IS NOT A BUSINESS TRUST. THE SOLE PURPOSE OF
THE TRUST IS TO ACQUIRE AND HOLD TITLE TO THE TRUST ESTATE, SUBJECT
TO THE RIGHTS OF THE LENDERS, FOR THE BENEFIT OF THE HOLDER. THE OWNER
TRUSTEE MAY NOT TRANSACT BUSINESS OF ANY KIND WITH RESPECT TO THE
FACILITY COMPRISING THE TRUST ESTATE NOR SHALL THIS AGREEMENT BE
DEEMED TO BE, OR CREATE OR EVIDENCE THE EXISTENCE OF A CORPORATION
DE FACTO OR DE JURE, OR A MASSACHUSETTS TRUST, OR ANY OTHER TYPE OF
BUSINESS TRUST, ASSOCIATION OR JOINT VENTURE BETWEEN THE OWNER
TRUSTEE, THE HOLDER, THE ADMINISTRATIVE AGENT AND THE LENDERS.
ARTICLE III
CONTRIBUTIONS AND PAYMENTS
SECTION 3.1 Procedure for Holder Fundings; Certificates.
(a) Upon receipt from the Lessee by the Administrative Agent of
the Requisition specified in Section 5.2 of the Participation Agreement,
and subject to the terms and conditions of the Participation Agreement,
the Administrative Agent shall request from the Holder a Holder Funding
and the Holder shall make a Holder Funding under the Holder Commitment
on each date Fundings are made pursuant to Section 5 of the
Participation Agreement. The Administrative Agent may request a Holder
Funding under the Holder Commitment during the Commitment Period on
any date that a Funding may be requested pursuant to the terms of
Section 5.2(a) of the Participation Agreement, provided that the
Administrative Agent shall give the Holder irrevocable notice (which
notice must be received by the Holder prior to 12:00 Noon, Atlanta,
Georgia time, three Business Days prior to the requested date of
Holder Funding, specifying (A) the amount to be funded, (B) the
requested date of funding, (C) whether the Holder Funding is to be a
Eurodollar Holder Funding or an ABR Holder Funding or a combination
thereof, (D) if the Holder Funding is to be a combination of
Eurodollar Holder Fundings and ABR Holder Fundings, the respective
amounts of each type of Holder Funding and (E) the Interest Period
applicable to any Eurodollar Holder Fundings; provided, however, that
any Holder Funding by the Holder in an amount less than $100,000
shall be an ABR Holder Funding. Pursuant to the terms of the
Participation Agreement, the Administrative Agent shall be deemed to
have delivered such notice upon the delivery of a notice by the
Construction Agent or the Lessee containing such required information.
(b) Upon receipt of any such notice delivered pursuant to Section
3.1(a), the Holder shall make the amount of its Holder Funding available
to the Owner Trustee at the office of the Owner Trustee referred to in
Section 11.4 prior to 12:00 Noon, Atlanta, Georgia time on the date
requested by the Lessee in funds immediately available to the Owner
Trustee.
(c) On each date during the Commitment Period which is three
Business Days prior to any Scheduled Interest Payment Date for the
Loans, the Owner Trustee shall be deemed to have requested an ABR Holder
Funding pursuant to Section 3.1(a) in an amount equal to the
aggregate amount of Holder Yield due and payable on such date with
respect to the Facility. The date such Holder Funding shall be made
with respect to any such request shall be the relevant Scheduled
Interest Payment Date for the Loans and the proceeds of such Holder
Funding shall be applied to pay such Holder Yield. On each such
date, the Holder Facility Cost shall be increased by an amount equal to
the Holder Yield paid on such date with respect to the Facility with the
proceeds of such Holder Funding.
(d) The Holder Fundings made by the Holder to the Trust Estate
shall be evidenced by a Certificate of the Owner Trustee, substantially
in the form of Exhibit A hereto, issued in the name of the Holder and in
an amount equal to the Holder Commitment. Each Certificate shall (i)
be dated as of the Initial Closing Date, (ii) be stated to be due on
the Expiration Date, subject to scheduled redemptions in accordance with
Schedule 1 of the Participation Agreement and (iii) bear a yield on
the aggregate Holder Amount thereof from time to time outstanding at the
Holder Yield.
(e) To the extent that the Owner Trustee, in its capacity as
Borrower under the Credit Agreement, shall have elected to terminate
or reduce the amount of the Commitments pursuant to Section 2.5(a) of
the Credit Agreement, a pro rata election shall be deemed to have
been made with respect to the Holder Commitment. On any date on
which the Commitments shall be reduced to zero as a result of a
Credit Agreement Event of Default, the Holder Commitment shall
automatically be reduced to zero and the Owner Trustee shall redeem
the Certificate in full for the outstanding Holder Amount, together
with accrued but unpaid Holder Yield thereon and all other amounts
owing under the Certificate.
SECTION 3.2 Certificate Yield.
(a) The Owner Trustee shall pay to the Holder, from the Trust
Estate, its pro rata portion of Holder Yield on Holder Fundings made
hereunder. Payment of Holder Yield to the Holder shall be made in
arrears on each Scheduled Interest Payment Date for the Loans occurring
after the Basic Term Commencement Date or as otherwise provided herein
or in Sections 2.6 or Section 10.7 of the Participation Agreement.
If the date on which such payment of Holder Yield is due shall not be
a Business Day, such payment shall be made on the next succeeding
Business Day.
(b) If all or a portion of Holder Yield shall not be received by
the Holder when due (for any reason), such overdue amount shall, without
limiting the rights of the Holder hereunder or under any Operative
Agreement, bear an increased yield at the Holder Overdue Yield, in
each case from the date of nonpayment until paid (whether after or
before judgment).
SECTION 3.3 Scheduled Return of Holder Fundings. The outstanding
Holder Amount shall be due in full on the Expiration Date and shall be redeemed
in part on the dates and in amounts equal to the product of (i) the percentage
for the applicable date multiplied by (ii) the aggregate amount of Holder
Fundings calculated as of the Basic Term Commencement Date, as set forth in
Schedule 1 of the Participation Agreement. On each such date and on the
Expiration Date, subject to the terms of the Participation Agreement, the Owner
Trustee shall return to the Holder the portion of the aggregate Holder Amount
then due, together with all accrued but unpaid Holder Yield.
SECTION 3.4 Early Return of Holder Fundings.
(a) The Owner Trustee may at any time and from time-to-time redeem
the Certificates, in whole or in part, without premium or penalty (but
excluding for these purposes amounts due under Sections 3.9 and 3.10),
upon at least five (5) Business Days' irrevocable notice to the
Administrative Agent, on behalf of the Holder, specifying the date and
amount of any such redemption and whether the redemption is of ABR
Holder Fundings or Eurodollar Holder Fundings or a combination
thereof, and, if a combination thereof, the amount allocable to each.
Upon receipt of such notice, the Administrative Agent shall promptly
notify the Holder thereof. If such notice is given, the amount
specified in such notice shall be due and payable on the date
specified therein.
(b) If on any date the Administrative Agent or the Owner Trustee
shall receive any payment in respect of (i) any Casualty or Condemnation
pursuant to Section 15.1(a) or 15.1(g) of the Lease (excluding any
payments in respect thereof which are payable to Lessee in accordance
with the Lease), or (ii) the Termination Value in connection with the
delivery of a Termination Notice pursuant to Article XVI of the Lease,
or (iii) the Termination Value or such other applicable amount in
connection with the exercise of a Purchase Option under Article XX of
the Lease or (iv) any payment required to be made or elected to be made
by the Construction Agent to the Owner Trustee pursuant to the Agency
Agreement, then in each case, the Holder shall receive proceeds in
accordance with Section 10.7(b)(ii) of the Participation Agreement.
SECTION 3.5 Payments from Trust Estate Only. All payments to be made
by the Owner Trustee under this Trust Agreement (including, without limitation,
any payments pursuant to Section 3.10) shall be made only from the income and
proceeds from the Trust Estate and only to the extent that the Owner Trustee
shall have received income or proceeds from the Trust Estate to make such
payments in accordance with the terms hereof, except as specifically provided in
Section 6.1. The Holder agrees that it will look solely to the income and
proceeds from the Trust Estate to the extent available for payment as herein
provided and that, except as specially provided herein, Trust Company shall not
be liable to the Holder for any amounts payable under this Trust Agreement
and shall not be subject to any liability under this Trust Agreement.
SECTION 3.6 Method of Payment. All amounts payable to the Holder
pursuant to this Trust Agreement shall be paid or caused to be paid by the Owner
Trustee to, or for the account of, the Holder, or its nominee, by transferring
such amount in immediately available funds to a bank institution or banking
institutions with bank wire transfer facilities for the account of the Holder or
as otherwise instructed in writing from time to time by the Holder.
SECTION 3.7 Computation of Yield.
(a) Whenever it is calculated on the basis of the Prime Lending
Rate, Holder Yield shall be calculated on the basis of a 365- (or 366-,
as the case may be) day year for the actual days elapsed; and,
otherwise, Holder Yield shall be calculated on the basis of a 360-day
year for the actual days elapsed. Any change in the Holder Yield
resulting from a change in the ABR or the Eurocurrency Reserve
Requirements shall become effective as of the opening of business on
the day on which such change becomes effective.
(b) Pursuant to Section 14.13 of the Participation Agreement, the
calculation of Holder Yield under this Section 3.7 shall be made by the
Administrative Agent. Each determination of an interest rate by the
Administrative Agent shall be conclusive and binding on the Owner
Trustee and the Holder in the absence of manifest error.
(c) If the Eurodollar Rate cannot be determined by the
Administrative Agent in the manner specified in the definition of the
term "Eurodollar Rate", the Owner Trustee shall give telecopy or
telephonic notice thereof to the Holder as soon as practicable after
receipt of same from the Administrative Agent. Commencing on the
Scheduled Interest Payment Date for the Loans next occurring after the
delivery of such notice and continuing until such time as the
Eurodollar Rate can be determined by the Administrative Agent in the
manner specified in the definition of such term, all outstanding
Holder Fundings shall bear a yield at the ABR applicable from time to
time. Until such time as the Eurodollar Rate can be determined by
the Administrative Agent in the manner specified in the definition of
such term, no further Eurodollar Holder Fundings shall be made or shall
be continued as such at the end of the then current Interest Period nor
shall the Owner Trustee have the right to convert ABR Holder Fundings to
Eurodollar Holder Fundings.
SECTION 3.8 Conversion and Continuation Options. (a) The Lessee may
elect from time to time to convert Eurodollar Holder Fundings to ABR
Holder Fundings by giving the Owner Trustee at least three Business
Days' prior irrevocable notice of such election, provided that any such
conversion of Eurodollar Holder Fundings may only be made on the last
day of an Interest Period with respect thereto. The Lessee may elect
from time to time to convert ABR Holder Fundings to Eurodollar Holder
Fundings by giving the Owner Trustee at least five Business Days' prior
irrevocable notice of such election. Any such notice of conversion to
Eurodollar Holder Fundings shall specify the length of the initial
Interest Period or Interest Periods therefor. Upon receipt of any
such notice, the Owner Trustee shall promptly notify the Holder
thereof. All or any part of outstanding Eurodollar Holder Fundings or
ABR Holder Fundings may be converted as provided herein, provided that
no ABR Holder Funding may be converted into a Eurodollar Holder Funding
after the date that is one month prior to the Expiration Date.
(b) Any Eurodollar Holder Funding may be continued as such upon
the expiration of the then current Interest Period with respect thereto
by the Lessee giving irrevocable notice to the Owner Trustee, in
accordance with the applicable notice provisions for the conversion of
ABR Holder Fundings to Eurodollar Holder fundings set forth above
herein, of the length of the next Interest Period to be applicable to
such Eurodollar Holder Funding, provided that no Eurodollar Holder
Funding may be continued as such after the date that is one month
prior to the Expiration Date and provided, further, that if the Lessee
shall fail to give any required notice as described above or if such
continuation is not permitted pursuant to the preceding proviso or
otherwise, such Eurodollar Holder Fundings automatically be converted
to ABR Holder Fundings on the last day of such then expiring Interest
Period.
SECTION 3.9 Increased Costs, Illegality, etc.
(a) If, due to either (i) the introduction of or any change in or
in the interpretation of any law or regulation or (ii) the compliance
with any guideline or request hereafter adopted, promulgated or made
by any central bank or other governmental authority (whether or not
having the force of law), there shall be any increase in the cost to the
Holder of agreeing to make or making, funding or maintaining Holder
Fundings, then the Owner Trustee shall from time to time, upon demand by
the Holder, pay to the Holder additional amounts sufficient to
compensate the Holder for such increased cost. A certificate as to
the amount of such increased cost, submitted to the Owner Trustee by
the Holder, shall be conclusive and binding for all purposes, absent
manifest error.
(b) If the Holder determines that compliance with any law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law, but
in each case promulgated or made after the date hereof) affects or
would affect the amount of capital required or expected to be
maintained by the Holder or any corporation controlling the Holder
and that the amount of such capital is increased by or based upon the
existence of the Holder's commitment to make Holder Fundings
hereunder and other commitments of this type, then, upon demand by
the Holder, the Owner Trustee shall immediately pay to the Holder,
from time to time as specified by the Holder, additional amounts
sufficient to compensate the Holder or such corporation in the light
of such circumstances, to the extent that the Holder reasonably
determines such increase in capital to be allocable to the existence of
the Holder's Commitment to make Holder Fundings hereunder. A
certificate as to such amounts submitted to the Owner Trustee by the
Holder shall be conclusive and binding for all purposes, absent
manifest error.
(c) Without limiting the effect of the foregoing, the Owner
Trustee shall pay to the Holder on the last day of the Interest
Period therefor so long as the Holder is maintaining reserves against
"Eurocurrency liabilities" under Regulation D an additional amount
(determined by the Holder and notified to the Owner Trustee) equal to
the product of the following for each Eurodollar Holder Funding for
each day during such Interest Period:
(i) the principal amount of such Eurodollar Holder
Funding outstanding on such day; and
(ii) the remainder of (x) a fraction the numerator of
which is the rate (expressed as a decimal) at which interest
accrues on such Eurodollar Holder Funding for such Interest Period
(less the Holder Applicable Margin) and the denominator of which is
one minus the effective rate (expressed as a decimal) at which such
reserve requirements are imposed on the Holder on such day minus
(y) such numerator; and
(iii) 1/360.
(d) Without affecting its rights under Section 3.9(a) or 3.9(b) or
any other provision of this Trust Agreement, the Holder agrees that if
there is any increase in any cost to or reduction in any amount
receivable by the Holder with respect to which the Owner Trustee would
be obligated to compensate the Holder pursuant to Sections 3.9(a) or
3.9(b), the Holder shall use reasonable efforts to select an
alternative office from which to fund Holder Fundings which would not
result in any such increase in any cost to or reduction in any amount
receivable by the Holder; provided, however, that the Holder shall
not be obligated to select such an alternate office if the Holder
determines that (i) as a result of such selection the Holder would be
in violation of any applicable law, regulation, treaty, or guideline, or
would incur additional costs or expenses or (ii) such selection would be
inadvisable for regulatory reasons or inconsistent with the interests of
the Holder.
(e) Notwithstanding any other provision of this Trust Agreement,
if the Holder shall notify the Owner Trustee that the introduction of or
any change in or in the interpretation of any law or regulation makes it
unlawful, or any central bank or other governmental authority asserts
that it is unlawful, for the Holder to perform its obligations hereunder
to make or maintain Holder Fundings bearing a yield based on the
Eurodollar Rate, then (x) all Eurodollar Holder Fundings outstanding
at such time shall thereafter bear a yield at the ABR from and after
the earlier of (i) the Scheduled Interest Payment Date for the Loans
next occurring after the date of such notice or (ii) such date as
required by law and (y) the obligation of the Holder to make, convert or
continue Eurodollar Holder Fundings shall be suspended until the Holder
has provided notification to the Owner Trustee of the Holder's
determination that the circumstances causing such suspension no
longer exist.
SECTION 3.10 Contribution Indemnity. Subject to the provisions of
Section 3.11, the Owner Trustee agrees to indemnify the Holder and to hold the
Holder harmless from any loss or reasonable expense which the Holder may sustain
or incur as a consequence of (a) default by the Owner Trustee in accepting any
Holder Funding hereunder after the Owner Trustee has given a notice requesting
the same in accordance with the provisions of this Trust Agreement, (b) default
by the Owner Trustee in making any redemption or other return of a Holder
Funding after the Owner Trustee has given a notice thereof in accordance with
the provisions of this Trust Agreement, or (c) the making of a voluntary or
involuntary redemption or other return of a Holder Funding on a day which is
not the last day of an Interest Period with respect thereto (unless such
Holder Funding is bearing a yield at the ABR in accordance with the terms
hereof). Such indemnification shall be in an amount equal to the excess, if
any, of (i) the amount of Holder Yield which would have accrued on the amount
so redeemed or returned or not accepted for the period from the date of such
redemption or other return or of such failure to accept on the last day of
such Interest Period (or, in the case of a failure to accept the Interest Period
that would have commenced on the date of such failure) in each case at the
applicable Eurodollar Rate for such Holder Fundings provided for herein over
(ii) the amount of yield (as determined by the Holder) which would have
accrued to the Holder on such amount by placing such amount on deposit for a
comparable period with leading banks in the relevant interest rate market.
This covenant shall survive the termination of this Trust Agreement and the
payment of all other amounts payable hereunder.
SECTION 3.11 Notice of Amounts Payable. (a) In the event that the
Holder becomes aware that any amounts are or will be owed to it pursuant to
Section 3.9 or 3.10 or that it is unable to make Holder Fundings which bear
a yield based on the Eurodollar Rate, then it shall promptly notify the Owner
Trustee thereof and, as soon as possible thereafter, the Holder shall submit
to the Owner Trustee a certificate indicating the amount owing to it and the
calculation thereof. The amounts set forth in such certificate shall be
prima facie evidence of the obligations of the Owner Trustee hereunder. If
the Holder receives a refund or realizes a return of any of the amounts
charged by the Holder pursuant to Section 3.9, the Holder shall promptly
credit such amounts to the Owner Trustee.
(b) Relocation. If the Holder claims any additional amounts payable
pursuant to Section 3.9 or that it is unable to make the Holder Funding which
bears a yield based on the Eurodollar Rate, it shall use its reasonable efforts
(consistent with legal and regulatory restrictions) to avoid or reduce the need
for paying such additional amounts or remedy such inability, including changing
the jurisdiction of its applicable lending office; provided, however, that the
taking of any such action would not in the sole judgment of the Holder, be
disadvantageous to the Holder.
(c) Mandatory Assignment. In the event that the Holder delivers to the
Owner Trustee a certificate in accordance with paragraph (a), or the Owner
Trustee is required to pay any additional amounts or other payments or the
Holder is required to make a Holder Funding bearing a yield at the ABR, subject
to the terms of the Participation Agreement, the Owner Trustee may, at its own
expense and in its sole discretion, (i) require the Holder to transfer or
assign, in whole or in part, without recourse (in accordance with Section
11.8), all or part of its interests, rights (except for rights to be
indemnified for actions taken while a party hereunder) and obligations under
this Agreement to a replacement bank or institution (provided, however, that,
subject to the Participation Agreement, the Owner Trustee, with the full
cooperation of the Holder, can identify a Person who is ready, willing and
able to be such replacement bank or institution with respect thereto) which
shall assume such assigned obligations, or (ii) during such time as no
Default or Event of Default has occurred and is continuing, terminate the
Holder Commitment of the Holder and redeem in full the outstanding Holder
Fundings of the Holder, provided, however, that (y) subject to the Participation
Agreement, the Owner Trustee or such replacement bank or institution, as the
case may be, shall have paid to the Holder in immediately available funds the
aggregate Holder Amount and accrued but unpaid Holder Yield to the date of
such payment and (subject to Section 3.9) all other amounts owed to it
hereunder and (z) such assignment or termination of the Holder Commitment and
redemption in full of the Holder Fundings do not conflict with any law, rule
or regulation or order of any court or Governmental Authority.
ARTICLE IV
COLLECTIONS AND DISTRIBUTIONS
SECTION 4.1 Collections and Remittances by the Owner Trustee. The
Owner Trustee agrees that, subject to the provisions of this Trust Agreement,
it will during the term of this Trust administer the Trust Estate and, at the
direction of the Holder (or, so long as the Credit Agreement shall continue,
subject to the provisions of the Credit Agreement and the Security
Documents), take steps to collect all Rent and other sums payable to the
Owner Trustee by the Lessee under the Lease. The Owner Trustee agrees to
distribute all proceeds received from the Trust Estate in accordance with
Article III and Sections 4.2 and 4.3. The Owner Trustee shall make such
distribution promptly upon receipt of such proceeds (provided such proceeds
are available for distribution) by the Owner Trustee, it being understood
and agreed that the Owner Trustee shall not be obligated to make such
distribution until the funds for such distribution have been received by the
Owner Trustee in cash or its equivalent reasonably acceptable to the Owner
Trustee.
SECTION 4.2 Priority of Distributions. Subject to the terms and
requirements of the Operative Agreements, all payments and amounts received
by Trust Company as Owner Trustee or on its behalf shall be distributed to
the Administrative Agent for allocation by the Administrative Agent in
accordance with the terms of Section 10.7 of the Participation Agreement or,
if such payments or amounts are received by the Owner Trustee from the
Administrative Agent, then they shall be distributed forthwith upon receipt
in the following order of priority: first, in accordance with the Holder
Yield protection provisions set forth in Article III; and, second, the
balance, if any, of such payment or amount remaining thereafter shall be
distributed to the Holder.
SECTION 4.3 Holder Excepted Payments. Anything in this Article IV or
elsewhere in this Trust Agreement to the contrary notwithstanding, any Holder
Excepted Payment received at any time by the Owner Trustee shall be distributed
promptly to the Person entitled to receive such Holder Excepted Payment.
SECTION 4.4 Distributions after Default. Subject to the terms of
Section 5.1 hereof, the proceeds received by the Owner Trustee from the
exercise of any remedy under the Lease shall be distributed pursuant to
Section 4.2 above. This Trust shall cease and terminate in accordance with
the terms set forth in Section 8.1 and upon the final disposition by the
Owner Trustee of all of the Trust Estate pursuant to this Section 4.4.
ARTICLE V
DUTIES OF THE OWNER TRUSTEE
SECTION 5.1 Notice of Certain Events. In the event the Owner Trustee
shall have knowledge of any Lease Default, Lease Event of Default, Credit
Agreement Default, Credit Agreement Event of Default, Agency Agreement
Default or Agency Agreement Event of Default, the Owner Trustee shall give
written notice thereof within five (5) Business Days to the Holder, the
Lessee and the Administrative Agent unless such Default or Event of Default
no longer exists before the giving of such notice. Subject to the provisions
of Section 5.3, the Owner Trustee shall take or refrain from taking such
action as Administrative Agent shall direct so long as the Credit Agreement
is in effect (and as more specifically provided in Section 10.2(j) of the
Participation Agreement) and thereafter as the Holder shall direct, in each
case by written instructions to the Owner Trustee. If the Owner Trustee
shall have given the Administrative Agent and the Holder notice of any event
and shall not have received written instructions as above provided within 30
days after mailing notice of such event to the Administrative Agent and the
Holder, the Owner Trustee may, but shall be under no duty to, and shall have
no liability for its failure or refusal to, take or refrain from taking any
action with respect thereto, not inconsistent with the provisions of the
Operative Agreements, as the Owner Trustee shall deem advisable and in the
best interests of the Lenders and the Holder. For all purposes of this Trust
Agreement, in the absence of actual knowledge of a Responsible Officer
in the Corporate Trust Department of Trust Company, the Owner Trustee shall be
deemed not to have knowledge of any Default or Event of Default unless a
Responsible Officer of the Corporate Trust Department of Trust Company
receives notice thereof given by or on behalf of the Holder, the Lessee or
the Administrative Agent.
SECTION 5.2 Action Upon Instructions. Subject to the provisions of
Sections 5.1 and 5.3, upon the written instructions of the Administrative Agent
or the Holder (as applicable) or, as permitted expressly by the Operative
Agreements, the Lessee, as the case may be, the Owner Trustee will take or
refrain from taking such action or actions as may be specified in such
instructions.
SECTION 5.3 Indemnification. The Owner Trustee shall not be required
to take or refrain from taking any action under this Trust Agreement or any
other Operative Agreement (other than the actions specified in the first
sentence of Section 5.1 and in the last sentence of Section 5.4) unless Trust
Company shall have been indemnified by the Lessee or, if Owner Trustee
reasonably believes such indemnity to be inadequate, by either the Lenders or
the Holder in manner and form reasonably satisfactory to Owner Trustee,
against any liability, fee, cost or expense (including reasonable attorneys'
fees and expenses) that may be incurred or charged in connection therewith,
other than such as may result from the willful misconduct or gross negligence
or willful breach of the Owner Trustee; and, if the Administrative Agent
and/or the Holder shall have directed the Owner Trustee to take or refrain
from taking any action under any Operative Agreement, the Lenders and/or
the Holder, as applicable, agree to furnish such indemnity by a written
undertaking of indemnification and, in addition, to pay the reasonable
compensation of Owner Trustee for the services performed or to be performed
by the Owner Trustee pursuant to such direction. The Owner Trustee shall not
be required to take any action under any Operative Agreement if Owner Trustee
shall reasonably determine, or shall have been advised by counsel, that such
action is likely to result in personal liability for which Owner Trustee has
not been and will not be adequately indemnified or is contrary to the terms
hereof or of any Operative Agreement to which the Owner Trustee is a party or
is otherwise contrary to law. The Owner Trustee shall be under no liability
with respect to any action taken or omitted to be taken by the Owner Trustee
in accordance with instructions of the Administrative Agent or the Holder
pursuant to Section 5.2 hereof.
SECTION 5.4 No Duties Except as Specified In Trust Agreement or
Instructions. The Owner Trustee shall not have any duty or obligation to
manage, control, use, make any payment in respect of, register, record,
insure, inspect, sell, dispose of or otherwise deal with the Facility or any
other part of the Trust Estate, or to otherwise take or refrain from taking
any action under or in connection with any Operative Agreement to which the
Owner Trustee is a party, except as expressly provided by the terms of this
Trust Agreement or in written instructions from the Administrative Agent
and/or the Holder, as applicable, received pursuant to Section 5.1, 5.2 or
8.4; and no implied duties or obligations shall be read into this Trust
Agreement against the Owner Trustee. The Owner Trustee shall have no duty or
obligation to supervise or monitor the performance of the Construction Agent
pursuant to the Agency Agreement which for all purposes shall be an independent
contractor. Owner Trustee nevertheless agrees that it will (in its individual
capacity and at its own cost and expense), promptly take all action as may be
necessary to discharge any Lessor Liens on any part of the Trust Estate.
SECTION 5.5 No Action Except Under Specified Documents or
Instructions. The Owner Trustee agrees that it will not manage, control,
use, sell, dispose of or otherwise deal with the Facility or any other part
of the Trust Estate except (i) as required by the terms of the Operative
Agreements, (ii) in accordance with the powers granted to, or the authority
conferred upon, it pursuant to this Trust Agreement or (iii) in accordance
with the express terms hereof or with written instructions from the
Administrative Agent and/or the Holder, as applicable, pursuant to Section
5.1, 5.2 or 8.4.
SECTION 5.6 Absence of Duties.
(a) Except in accordance with written instructions furnished
pursuant to Section 5.1, 5.2 or 8.4, and without limitation of the
generality of Section 5.4, the Owner Trustee shall not have any duty to
(i) file, record or deposit any Operative Agreement or any other
document, or to maintain any such filing, recording or deposit or to
refile, rerecord or redeposit any such document; (ii) obtain
insurance on the Facility or effect or maintain any such insurance,
other than to receive and forward to the Holder any notices,
policies, certificates or binders furnished to the Owner Trustee
pursuant to the Lease; (iii) maintain the Facility; (iv) pay or
discharge any Tax or any Lien owing with respect to or assessed or
levied against any part of the Trust Estate, except as provided in
the last sentence of Section 5.4, other than to forward notice of
such Tax or Lien received by the Owner Trustee to the Holder and the
Administrative Agent; (v) confirm, verify, investigate or inquire
into the failure to receive any reports or financial statements of
the Lessee; (vi) inspect the Facility any time or ascertain or
inquire as to the performance or observance of any of the covenants of
the Lessee or any other Person under any Operative Agreement with
respect to the Facility; or (vii) manage, control, use, sell, dispose of
or otherwise deal with the Facility or any part thereof or any other
part of the Trust Estate, except as provided in Section 5.5.
(b) The Owner Trustee, in the exercise or administration of the
trusts and powers hereunder, including its obligations under Section 5.2
hereof, may, at the expense of the Lessee, employ agents, attorneys,
accountants, and auditors and enter into agreements with any of them and
Owner Trustee shall not be liable, either in its individual capacity or
in its capacity as Owner Trustee, for the default or misconduct of any
such agents, attorneys, accountants or auditors if such agents,
attorneys, accountants or auditors shall have been selected by it in
good faith.
ARTICLE VI
THE OWNER TRUSTEE
SECTION 6.1 Acceptance of Trust and Duties. Owner Trustee accepts
the trust and duties hereby created and agrees to perform the same, but only
upon the terms of this Trust Agreement. Owner Trustee agrees to receive,
manage and disburse all moneys constituting part of the Trust Estate actually
received by it as Owner Trustee in accordance with the terms of this Trust
Agreement. Owner Trustee shall not be answerable or accountable under any
circumstances, except for (i) its own willful misconduct or gross negligence
or willful breach, (ii) the inaccuracy of any of is representations or
warranties contained in Section 6.3 of this Trust Agreement or Section 7.2 of
the Participation Agreement, (iii) its failure to perform obligations
expressly undertaken by it in the last sentence of Section 5.4 of this Trust
Agreement or in Section 10.2(a) of the Participation Agreement, (iv) Taxes
based on or measured by any fees, commissions or compensation received by it
for acting as Owner Trustee in connection with any of the transactions
contemplated by the Operative Agreements, or (v) its failure to use ordinary
care to receive, manage and disburse moneys actually received by it in
accordance with the terms hereof.
SECTION 6.2 Furnishing of Documents. The Owner Trustee will furnish
to the Holder and to the Administrative Agent, promptly upon receipt thereof,
duplicates or copies of all reports, notices, requests, demands, opinions,
certificates, financial statements and any other instruments or writings
furnished to the Owner Trustee hereunder or under the Operative Agreements,
unless by the express terms of any Operative Agreement a copy of the same is
required to be furnished by some other Person directly to the Holder and/or
the Administrative Agent, or the Owner Trustee shall have determined that the
same has already been furnished to the Holder and the Administrative Agent.
SECTION 6.3 No Representations or Warranties as to the Facility or
Operative Agreements. OWNER TRUSTEE MAKES (i) NO REPRESENTATION OR WARRANTY,
EITHER EXPRESS OR IMPLIED, AS TO THE TITLE, VALUE, USE, CONDITION, DESIGN,
OPERATION, MERCHANTABILITY OR FITNESS FOR USE OF THE FACILITY (OR ANY PART
THEREOF), OR ANY OTHER REPRESENTATION, WARRANTY OR COVENANT WHATSOEVER,
EXPRESS OR IMPLIED, WITH RESPECT TO THE FACILITY (OR ANY PART THEREOF) AND
OWNER TRUSTEE SHALL NOT BE LIABLE FOR ANY LATENT, HIDDEN, OR PATENT DEFECT
THEREIN OR THE FAILURE OF THE FACILITY, OR ANY PART THEREOF, TO COMPLY WITH
ANY LEGAL REQUIREMENT except that Owner Trustee hereby represents, warrants
and covenants to the Holder that it will comply with the last sentence of
Section 5.4, and (ii) no representation or warranty as to the validity or
enforceability of any Operative Agreement or as to the correctness of any
statement made by a Person other than Owner Trustee or the Owner Trustee
contained in any thereof, except that Owner Trustee represents, warrants and
covenants to the Holder that this Trust Agreement has been and each of the other
Operative Agreements which contemplates execution thereof by the Owner Trustee
has been or will be executed and delivered by its officers who are, or will be,
duly authorized to execute and deliver documents on its behalf.
SECTION 6.4 No Segregation of Moneys; No Interest. Except as
otherwise provided herein or in any of the other Operative Agreements, moneys
received by the Owner Trustee hereunder need not be segregated in any manner
except to the extent required by law, and may be deposited under such general
conditions as may be prescribed by law, and neither Trust Company nor the
Owner Trustee shall be liable for any interest thereon, except as may be
agreed to in writing by Owner Trustee or the Trust Company.
SECTION 6.5 Reliance; Advice of Counsel. Owner Trustee shall not
incur any liability to any Person in acting upon any signature, instrument,
notice, resolution, request, consent, order, certificate, report, opinion,
bond or other document or paper believed by it to be genuine and believed by
it in good faith to be signed by the proper party or parties. Owner Trustee
may accept and rely upon a certified copy of a resolution of the board of
directors or other governing body of any corporate party as conclusive
evidence that such resolution has been duly adopted by such body and that the
same is in full force and effect. As to any fact or matter the manner of
ascertainment of which is not specifically prescribed herein, Owner Trustee
may for all purposes hereof rely on an Officers' Certificate of the relevant
party, as to such fact or matter, and such certificate shall constitute full
protection to Owner Trustee for any action taken or omitted to be taken by it
in good faith in reliance thereon. In the administration of the trusts
hereunder, the Owner Trustee may execute any of the trusts or powers hereof and
perform its powers and duties hereunder directly or through agents or attorneys
and may consult with counsel, accountants and other skilled Persons to be
selected and employed by it, and Owner Trustee shall not be liable for
anything done, suffered or omitted in good faith by it in accordance with the
advice or opinion of any such counsel, accountants or other skilled Persons
and not contrary to this Trust Agreement.
SECTION 6.6 Liability With Respect to Documents. The Owner Trustee,
either in its trust or individual capacities, shall not incur any liability to
any Person for or in respect of the recitals herein, the validity or sufficiency
of this Trust Agreement or for the due execution hereof by the Holder or for the
form, character,genuineness, sufficiency, value or validity of the Facility or
for or in respect of the validity or sufficiency of any of the Operative
Agreements and the Owner Trustee, either in its trust or individual
capacities, shall in no event assume or incur any liability, duty or
obligation to any Person or to the Holder, other than as expressly provided
for herein or in any of the other Operative Agreements.
SECTION 6.7 Not Acting In Individual Capacity. All Persons having
any claim against Owner Trustee by reason of the transactions contemplated by
the Operative Agreements shall look only to the Trust Estate (or a part
thereof, as the case maybe) for payment or satisfaction thereof, except as
specifically provided in this Article VI and except to the extent that Owner
Trustee shall otherwise expressly agree in any Operative Agreement to which
it is a party.
SECTION 6.8 Books and Records; Tax Returns.
(a) The Owner Trustee shall be responsible for the keeping of all
appropriate books and records relating to the receipt and disbursement
of all moneys that it may receive hereunder, or under any other
Operative Agreement. The Owner Trustee shall, at the expense of the
Owner Trustee (in its individual capacity), file an application with
the Internal Revenue Service for a taxpayer identification number
with respect to the trust created hereby. The Owner Trustee shall,
at the expense of the Owner Trustee (in its individual capacity),
prepare or cause to be prepared and the Owner Trustee shall sign
and/or file the federal fiduciary tax return with respect to Taxes
due and payable by the trust created hereby in connection with the
transactions contemplated hereby and by any other Operative Agreement.
The Holder shall furnish the Owner Trustee with all such information as
may be reasonably required from the Holder in connection with the
preparation of such tax returns. The Owner Trustee shall keep copies of
all returns delivered to or filed by it.
(b) The Owner Trustee, either in its trust or individual
capacities, shall be under no obligation to appear in, prosecute or
defend any action, which in its opinion may require it to incur any
out-of-pocket expense or any liability unless it shall be furnished
with such reasonable security and indemnity against such expense or
liability as it may require. The Owner Trustee may, but shall be
under no duty to, undertake such action as it may deem necessary at
any and all times, without any further action by the Administrative
Agent or the Holder to protect the Facility and the rights and
interests of the Holder pursuant to the terms of this Trust Agreement;
provided, however, that Owner Trustee may obtain reimbursement for the
out-of-pocket expenses and costs of such actions, undertakings or
proceedings from the Lessee.
SECTION 6.9 Substitute Owner Trustee; Owner Trustee Advisor. First
Security Bank of Utah, N.A. has entered into this Trust Agreement and the other
Operative Agreements not individually, except as expressly stated herein or
therein (as the case may be), but solely as Owner Trustee under the Trust;
provided, notwithstanding the foregoing provisions of this Section 6.9, solely
to the extent that the Louisiana Trust Code (L.A. R.S. 9:1721 et. seq.) is
deemed to apply to the Trust, then (a) Mr. Val T. Orton, a resident of Davis
County, Utah shall be deemed to be the sole Owner Trustee with respect to the
Trust and (b) First Security Bank of Utah, N.A. (and any replacement or
successor thereto appointed by the Holder with the consent of the Majority
Lenders) shall be deemed to be the Owner Trustee Advisor. To the extent not
prohibited by the relevant provisions of the Louisiana Trust Code, in his
capacity as Owner Trustee, Mr. Val T. Orton shall act in accordance with the
express, written directions of the Owner Trustee Advisor and any actions not
in accordance with such directions shall be deemed null and void and of no
force or effect under the Operative Agreements or otherwise. In its capacity
as Owner Trustee Advisor, First Security Bank of Utah, N.A. shall act (x) in
accordance with the directions, limitations, terms and provisions of the
Operative Agreements otherwise applicable to the Owner Trustee and (y) to the
extent the Operative Agreements do not contain any direction, limitation,
term or provision with regard to any particular situation, in accordance with
the written instructions of the Holder. Actions taken by the Owner Trustee
Advisor which are not in accordance with the requirements of the immediately
preceding sentence shall be deemed null and void and of no force or effect
under the Operative Agreements or otherwise. In the event Mr. Val T. Orton
shall become the Owner Trustee, he shall not be required to post a bond of
any kind. To the extent the Louisiana Trust Code is deemed to apply to
the Trust, Mr. Val T. Orton hereby accepts the trust and duties hereby
created and agrees to perform the same, but only upon the terms of this
Trust Agreement.
ARTICLE VII
INDEMNIFICATION OF THE OWNER TRUSTEE
SECTION 7.1 Indemnification Generally. The Owner Trustee is
indemnified for matters related to the transactions described herein by the
Lessee pursuant to Section 13 of the Participation Agreement. Except as may
be specifically provided from time to time hereafter in writing by the
Holder, the Owner Trustee shall not have any right of indemnification from
the Holder with respect to the transactions described herein or in any of the
other Operative Agreements.
SECTION 7.2 Compensation and Expenses. The Lessee has agreed to pay
the fees and expenses of the Owner Trustee, the Holder Unused Fees and Holder
Participation Fees as provided in Sections 9.3, 9.4 and 9.5, respectively, of
the Participation Agreement.
ARTICLE VIII
TERMINATION OF TRUST AGREEMENT
SECTION 8.1 Termination of Trust Agreement. This Trust Agreement and
the trusts created hereby shall terminate and the Trust Estate shall, subject to
the provisions of the Participation Agreement, the other Operative Agreements
and Article IV hereof, be distributed to the Holder, and this Trust Agreement
shall be of no further force or effect, upon the earliest of (i) the written
request of the Holder following the sale or other final disposition by the
Owner Trustee of all property constituting part of the Trust Estate and the
final distribution by the Owner Trustee of all moneys or other property or
proceeds constituting part of the Trust Estate in accordance with the terms
hereof; provided, however, that the Trust Estate shall not be subject to sale
or other final disposition by the Owner Trustee prior to the payment in full
and discharge of the Loans and all other indebtedness secured by the Credit
Documents and the release of the Credit Documents and the liens and security
interest granted thereby and the payment in full of the Holder Amount and
Holder Yield thereon and all other amounts owing to the Holder under any of
the Operative Agreements; and (ii) 110 years after the date hereof.
SECTION 8.2 Termination at Option of the Holder. Notwithstanding
Section 8.1, this Trust Agreement and the trusts created hereby shall
terminate and the Trust Estate shall be distributed to the Holder, and this
Trust Agreement shall be of no further force and effect, upon the election of
the Holder by notice to the Owner Trustee, if such notice shall be
accompanied by the written agreement of the Holder assuming all the
obligations of the Owner Trustee under or contemplated by the Operative
Agreements and all other obligations of the Owner Trustee incurred by it as
trustee hereunder; provided, however, that the Holder agrees for the express
benefit of the Administrative Agent and the Lenders, that without the consent
of the Administrative Agent, no such election shall be effective until the
Liens and security interests of the Security Documents on the Collateral
shall have been released and until full payment of the principal of, and
interest on the Loans and all other sums due to the Lenders shall have been
made. Such written agreement shall be reasonably satisfactory in form and
substance to the Owner Trustee and shall release the Owner Trustee from all
further obligations of the Owner Trustee hereunder and under the agreements
and other instruments mentioned in the preceding sentence.
SECTION 8.3 Termination at Option of the Owner Trustee.
Notwithstanding any other section hereof, at any time that the Lease shall no
longer be in full force and effect and the Administrative Agent shall have
confirmed in writing to the Owner Trustee that the Lenders have received
payment in full of the principal of and interest on the Loans and that all
other sums due to the Administrative Agent and the Lenders under the
Operative Documents shall have been made, then the Holder hereby authorizes
the Owner Trustee to: (a) terminate this Trust Agreement and the trusts
created hereby and (b) distribute and convey the Trust Estate to the Holder
by executing the necessary transfer documents as contemplated by Section 8.4
hereof. The exercise of such option by the Owner Trustee shall cause this Trust
Agreement to be of no further force and effect and shall release the Owner
Trustee from all further obligations of the Owner Trustee hereunder and under
the agreements and other instruments mentioned in the preceding sentence.
SECTION 8.4 Actions by the Owner Trustee Upon Termination. Upon
termination of this Trust Agreement and the trusts created hereby pursuant to
Section 8.1, Section 8.2 or Section 8.3, the Owner Trustee shall upon notice
of such event take such action as may be necessary or as may be requested by
the Holder to transfer the Trust Estate to the Holder, including, without
limitation, the execution of instruments of transfer or assignment with
respect to any of the Operative Agreements to which the Owner Trustee is a
party.
ARTICLE IX
SUCCESSOR OWNER TRUSTEES, CO-OWNER TRUSTEES
AND SEPARATE OWNER TRUSTEES
SECTION 9.1 Resignation of the Owner Trustee; Appointment of
Successor.
(a) The Owner Trustee may resign at any time without cause by
giving at least 30 days' prior written notice to the Holder, the
Administrative Agent and the Lessee; provided, however that such
resignation shall not be effective until the acceptance of
appointment by a successor Owner Trustee under Section 9.1(b). The
Owner Trustee may be removed with or without cause at any time by the
Holder upon consent to such removal by the Administrative Agent and
with 30 days' prior written notice to the Owner Trustee, a copy of
which notice shall be concurrently delivered by the Holder to the
Administrative Agent and the Lessee. Any such removal shall be
effective upon the acceptance of appointment by a successor Owner
Trustee under Section 9.1(b). In case of the resignation or removal of
the Owner Trustee, the Holder may appoint a successor Owner Trustee by
an instrument signed by the Holder; provided, however, that such
successor Owner Trustee must be approved by the Administrative Agent.
In the event the Owner Trustee shall be an individual, his death or
incapacity, or termination of employment (whether voluntary or
involuntary) with First Security Bank of Utah, N.A. (or a successor
corporate Owner Trustee or Owner Trustee Advisor) shall be treated
as a resignation hereunder and shall be effective immediately. If a
successor Owner Trustee shall not have been appointed within 30 days
after the giving of written notice of such resignation or the
delivery of the written instrument with respect to such removal, the
Owner Trustee or the Holder may apply to any court of competent
jurisdiction to appoint a successor Owner Trustee to act until such
time, if any, as a successor shall have been appointed and shall have
accepted its appointment as above provided. Any successor Owner
Trustee so appointed by such court shall immediately and without
further act be superseded by any successor Owner Trustee appointed as
above provided within one year from the date of the appointment by
such court.
(b) Any successor Owner Trustee, however appointed, shall execute
and deliver to the predecessor Owner Trustee an instrument accepting
such appointment, and thereupon such successor Owner Trustee, without
further act shall become vested with all the estates, properties,
rights, powers, duties and trusts of the predecessor Owner Trustee in
the trusts hereunder with like effect as if originally named an Owner
Trustee herein; but nevertheless, upon the written request of such
successor Owner Trustee such predecessor Owner Trustee shall execute
and deliver an instrument transferring to such successor Owner
Trustee, upon the trusts herein expressed, all the estates,
properties, rights, powers, duties and trusts of such predecessor Owner
Trustee, and such predecessor Owner Trustee shall duly assign, transfer,
deliver and pay over to such successor Owner Trustee all moneys or other
property then held by such predecessor Owner Trustee upon the trusts
herein expressed.
(c) Any successor Owner Trustee, however appointed, shall, to the
extent the provisions of the Louisiana Trust Code shall then be deemed
to apply to the Trust, be an individual, and otherwise, a bank or trust
company incorporated and doing business within the United States of
America and having a combined capital and surplus of at least
$50,000,000, if there be such an institution willing, able and
legally qualified to perform the duties of Owner Trustee hereunder
upon reasonable or customary terms.
(d) Any corporation into which the Owner Trustee may be merged or
converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the
Owner Trustee shall be a party, or any corporation to which
substantially all the corporate trust business of the Owner Trustee
may be transferred, shall, subject to the terms of Section 9.1(c), be
the Owner Trustee under this Trust Agreement without further act.
SECTION 9.2 Co-Trustees and Separate Trustees. Whenever the Owner
Trustee or the Holder shall deem it necessary or prudent in order either (i)
to conform to any law of any jurisdiction in which all or any part of the
Trust Estate shall be situated or to which it may be subject or to make any
claim or bring any suit with respect to the Trust Estate or any Operative
Agreement, or (ii) shall be advised by counsel satisfactory to it that it is
so necessary or prudent, or (iii) the Owner Trustee shall have been directed
to do so by the Holder and the Administrative Agent, the Owner Trustee and
the Holder shall execute and deliver an agreement supplemental hereto and all
other instruments and agreements, and shall take all other action, necessary
or proper to constitute one or more Persons who need not meet the
requirements of Section 9.1(c) (and the Owner Trustee may appoint one or more
of its officers) either as co-trustee or co-trustees (the "Co-Owner Trustee"),
jointly with the Owner Trustee, of all or any part of the Trust Estate, or as
separate trustee or separate trustees of all or any part of the Trust Estate,
and to vest in such Persons, in such capacity, such title to the Trust Estate
or any part thereof and such rights or duties as may be necessary or
desirable, all for such period and under such terms and conditions as are
satisfactory to the Owner Trustee and the Holder. In accordance with the
foregoing:
(a) Owner Trustee shall appoint a Co-Owner Trustee hereunder in
part so that if, under any present or future law of any State where the
Facility is located or of any jurisdiction in which it may be necessary
to perform any act in carrying out the trusts herein created, Owner
Trustee or any of its successors may be incompetent or unqualified or
incapacitated or unwilling to perform certain acts as such Owner
Trustee, then upon the written request of Owner Trustee of any of its
successors received by any Co-Owner Trustee, all of such acts
required to be performed in such jurisdiction in the execution of the
trust hereby created, shall and will be performed by any Co-Owner
Trustee, or any of his successors, in trust acting alone, as if he or
such successor had been specifically authorized so to do or had been
the sole Owner Trustee hereunder. Any Co-Owner Trustee shall
continue to perform such acts until otherwise directed in writing by
Owner Trustee or any of its successors. Any request in writing by
Owner Trustee or any of its successors to the Co-Owner Trustee shall
be sufficient warrant for him to take such action as may be so
requested.
(b) Except as it may be deemed necessary for any Co-Owner Trustee
or any of his successors solely or jointly to execute the trusts herein
created, Owner Trustee or any of its successors shall solely have and
exercise the powers, and shall be solely charged with the performance
of the duties, hereinbefore declared on the part of the Owner Trustee
to be had, exercised and performed; and any Co-Owner Trustee shall not
be liable therefor. Any Co-Owner Trustee or any successor to him may
delegate to Owner Trustee or its successor hereunder the exercise of
any power, discretion or otherwise, conferred by any provision of
this Trust Agreement.
(c) Any act of the Owner Trustee herein required or authorized
shall and will be jointly or separately performed by Owner Trustee or
its successors hereunder and by any Co-Owner Trustee or any of his
successors appointed hereunder, if such joint performance or separate
performance shall be necessary to the legality of such act and when so
acting all references herein to "First Security Bank of Utah, N.A."
shall be deemed to be references to such Co-Owner Trustee in its
individual capacity and all references to "Owner Trustee" shall be
deemed to be references to any Co-Owner Trustee, and such Co-Owner
Trustee shall be entitled to all the protection, indemnification,
immunity and compensation herein provided to Owner Trustee acting
singly in reference to such acts (subject to the limitations to such
a protection, indemnification, immunity and compensation set forth
herein).
(d) Owner Trustee or its successor in trust shall have and is
hereby given the power at any time by an instrument in writing duly
executed by a Vice President, and under its corporate seal, to remove
any Co-Owner Trustee or his successor, from his position as Co-Owner
Trustee hereunder. In the case of death, resignation, removal,
incapacity or inability to act hereunder of the Co-Owner Trustee, or
his successor as Co-Owner Trustee, any adult citizen of the United
States of America may be appointed Co-Owner Trustee hereunder by the
person who shall at the time be a Vice President of the corporation
then acting as Owner Trustee hereunder by an instrument in writing
duly executed and, subject to its right to revoke such appointment or
to appoint another person, Owner Trustee shall appoint a successor
Co-Owner Trustee, such appointment to be immediately effective in
case of the death, resignation, removal or inability or incapacity to
act hereunder of the Co-Owner Trustee. In the event a vacancy occurs
in the office of the Co-Owner Trustee, either by reason of
resignation, removal, incapacity or inability to act and no successor
is appointed pursuant to the foregoing provisions within 30 days
after such vacancy occurs, the Holder and the Administrative Agent
may jointly appoint a successor to the Co-Owner Trustee in the same
manner as is provided for the appointment of a successor to the
Co-Owner Trustee hereunder.
(e) At any time or times, for the purposes of meeting the legal
requirements of any jurisdiction in which any part of the Trust Estate
hereunder may at the time be located, or to avoid any violation of law
or imposition of taxes not otherwise imposed on the Owner Trustee, or
if the Owner Trustee shall deem it desirable for its own protection,
Owner Trustee shall have power to appoint one or more persons (who
may be officers of Owner Trustee either to act as an additional
co-trustee, jointly with Owner Trustee) of all or any part of the
Trust Estate hereunder, or of any property constituting part thereof,
or to act as separate trustee of any part of the Trust Estate in
either case with such powers as may be provided in the instrument of
appointment and are consistent with the terms hereof, and to vest in
such person or persons in the capacity as aforesaid, any property,
title, right or power deemed necessary or desirable, subject to the
remaining provisions of this Section 9.2.
(f) Notwithstanding any provision of this Trust Agreement to the
contrary, any additional co-trustee shall act upon and be subject to the
following terms and conditions:
All rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred or imposed solely
upon and solely exercised and performed by Owner Trustee except to
the extent that under any law of any jurisdiction in which any
particular act or acts are to be performed Owner Trustee or the
Owner Trustee shall be incompetent or unqualified to perform
such act or acts or to avoid any violation of law or imposition
of taxes not otherwise imposed on the Owner Trustee, or if the
Owner Trustee shall deem it desirable for their own protection,
in which event such rights, powers, duties and obligations shall
be exercised and performed by such co-trustee or Co-Owner Trustee.
(g) No power granted by this Trust Agreement to, or which this
Trust Agreement provides may be exercised by, the Owner Trustee in
respect of the custody, control and management of moneys may be
exercised by any Co-Owner Trustee or any subsequently appointed
co-trustee except jointly with, or with the consent in writing of,
Owner Trustee for disbursement or application in accordance with the
terms hereof.
(h) All moneys which may be received or collected by any Co-Owner
Trustee or such subsequently appointed co-trustees shall be paid over to
Owner Trustee to be distributed in accordance with this Trust Agreement
and the other Operative Agreements.
(i) Any Co-Owner Trustee, or any subsequently appointed
co-trustee to the extent permitted by law, does hereby constitute
Owner Trustee or its successors hereunder his or her agent or
attorney in fact, with full power and authority to do any and all
acts and things and exercise any and all discretion authorized or
permitted by the Co-Owner Trustee or such subsequently appointed
co-trustee, in its behalf or in its name.
(j) No trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder.
SECTION 9.3 Notice. At all times that a successor Owner Trustee is
appointed pursuant to Section 9.1, an Owner Trustee resigns pursuant to Section
9.1 or the Co-Owner Trustee, a co-trustee or separate trustee, is appointed
pursuant to Section 9.2, the Holder shall give notice of such fact within 30
days of its occurrence to (x) the Lessee, if the Lease is then in effect and
(y) the Administrative Agent, if the Credit Agreement is in effect.
ARTICLE X
SUPPLEMENTS AND AMENDMENTS
SECTION 10.1 Supplements and Amendments. Subject to Section 10.2 of
this Trust Agreement, and Section 10.2 of the Participation Agreement, at the
written request of the Holder, this Trust Agreement shall be amended by a
written instrument signed by Owner Trustee and the Holder.
SECTION 10.2 Limitation on Amendments. Notwithstanding Section 10.1,
Owner Trustee shall not, without the consent of the Administrative Agent
execute any amendment that might result in the trusts created hereunder being
terminated prior to the satisfaction and discharge of the Lien and security
interest of the Security Documents on the Collateral and the payment in full
of the principal of and interest on the Loans and other than in accordance
with the terms of the Credit Agreement.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 No Legal Title to Trust Estate in the Holder. The Holder
shall not have legal title to any part of the Trust Estate; provided, however,
that the Holder has a beneficial interest in the Trust Estate. No transfer, by
operation of law or otherwise, of any right, title or interest of the Holder in
and to the Trust Estate or hereunder shall operate to terminate this Trust
Agreement or the Trust or the trusts hereunder or entitle any successor or
transferee to an accounting or to the transfer to it of legal title to any
part of the Trust Estate.
SECTION 11.2 Sale of the Facility by the Owner Trustee is Binding.
Any sale, transfer, or other conveyance of the Facility or any part thereof by
the Owner Trustee made pursuant to the terms of this Trust Agreement or any
other Operative Agreement shall bind the Holder and shall be effective to
sell, transfer and convey all right, title and interest of the Owner Trustee
and the Holder in and to the Facility or any part thereof. No purchaser or
other grantee shall be required to inquire as to the authorization,
necessity, expediency or regularity of such sale or conveyance or as to the
application of any sale or other proceeds with respect thereto by the Owner
Trustee.
SECTION 11.3 Limitations on Rights of Others. Nothing in this Trust
Agreement whether express or implied, shall be construed to give to any Person,
other than Owner Trustee and the Holder, any legal or equitable right, remedy or
claim under or in respect of this Trust Agreement, any covenants, conditions or
provisions contained herein or in the Trust Estate; but this Trust Agreement
shall be held for the sole and exclusive benefit of the Owner Trustee and the
Holder. The Administrative Agent shall have the right to enforce the
provisions of Sections 5.1, 5.2, 5.3, 5.4, 6.2, 6.8, 8.1, 8.2, 8.3, 9.1, 9.2,
9.3, 10.1 and 10.2 hereof prior to the payment in full of the principal of
and interest on the Loans and such other amounts due and payable to the
Lenders or the Administrative Agent under the Operative Agreements.
SECTION 11.4 Notices. Unless otherwise expressly specified or
permitted by the terms hereof, all notices hereunder shall be given as
provided in the Participation Agreement.
SECTION 11.5 Severability. Any provision of this Trust Agreement that
may be determined by competent authority to be prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.
SECTION 11.6 Limitation on the Holder's Liability. The Holder shall
have no liability for the performance of this Trust Agreement except as
expressly set forth herein.
SECTION 11.7 Separate Counterparts; Dating. This Trust Agreement may
be executed by the parties hereto in separate counterparts, each of which when
so executed and delivered shall be an original, but all such counterparts shall
together constitute but one and the same instrument.
SECTION 11.8 Successors and Assigns.
(a) All covenants and agreements contained herein shall be binding
upon, and inure to the benefit of, Trust Company, the Owner Trustee and
its successors and assigns and the Holder and its successors and
assigns, all as herein provided. Any request, notice, direction,
consent, waiver or other instrument or action by the Holder shall
bind the successors and assigns of the Holder.
(b) Subject to the terms of Section 12.1 of the Participation
Agreement, the Holder may transfer or assign all or any portion of
its right, title and interest in the Trust Estate, this Trust
Agreement and the Certificate of the Holder pursuant to an assignment
agreement in a form acceptable to the Owner Trustee, which assignment
agreement shall provide, without limitation, that the assignee
undertakes and assumes all obligations and covenants of the Holder
under this Trust Agreement and the other Operative Documents. The
Holder proposing the transfer or assignment shall notify the Owner
Trustee in writing of the effective date of the transfer or
assignment, which effective date shall be at least three (3) Business
Days after the date of such notification. The Owner Trustee shall
maintain a register showing the Holder and its interests in the Trust
Estate and, upon the occurrence of a permitted assignment pursuant to
this Section 11.8(b), shall issue a Certificate to the assignee and, if
the assigning Holder is maintaining an interest hereunder, a new
Certificate to such assigning Holder representing its revised
interest in the Trust Estate.
SECTION 11.9 Headings. The headings of the various articles and
sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 11.10 Governing Law. THIS TRUST AGREEMENT HAS BEEN DELIVERED
IN, AND SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAW OF, THE STATE OF GEORGIA.
SECTION 11.11 Performance by the Holder. Any obligation of the Owner
Trustee hereunder or under any Operative Document or other document contemplated
herein may be performed by the Holder and any such performance shall not be
construed as a revocation of the trusts created hereby.
SECTION 11.12 Conflict with Operative Agreements. If this Trust
Agreement (or any instructions given by the Holder pursuant hereto) shall
require that any action be taken with respect to any matter and any other
Operative Agreement (or any instructions duly given in accordance with the
terms thereof) shall require that a different action be taken with respect to
such matter, and such actions shall be mutually exclusive, the provisions of
such other Operative Agreement, in respect thereof, shall control.
SECTION 11.13 No Implied Waiver. No term or provision of this Trust
Agreement may be changed, waived, discharged or terminated orally, but only
by an instrument in writing entered into as provided in Section 10.1; and any
such waiver of the term hereof shall be effective only in the specific
instance and for the specific purpose given.
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed by their respective officers hereunto duly authorized, as of
the date set forth above.
FIRST SECURITY BANK OF UTAH, N.A.
By:
Name:
Title:
First Security Bank of Utah, N.A.
79 South Main Street
Salt Lake City, Utah 84111
Attention: Val T. Orton
Telecopy Number: (801) 246-5053
Telephone Number: (801) 246-5300
WITNESSES AS TO
FIRST SECURITY BANK OF UTAH, N.A.,
not individually, except as
expressly stated herein, but solely
as Owner Trustee under the GGC Trust 1996-1
STATE OF )
) ss:
COUNTY OF )
The foregoing Trust Agreement was acknowledged before me, the undersigned
Notary Public, in the County of _____________ this ______ day of ______________,
1996 by
_____________________, as ________________ of First Security Bank of Utah, N.A.,
a national banking association, on behalf of the bank.
FIRST SECURITY BANK OF UTAH, N.A.
By:
Name:
Title:
[Notarial Seal]
Notary Public
My commission expires: ________________
NATIONSBANC LEASING CORPORATION OF
NORTH CAROLINA, as the Holder
By:
Name:
Title:
NationsBanc Leasing Corporation
of North Carolina
101 South Tryon Street
NC1-002-38-20
Charlotte, North Carolina 28255
Attention: M. Randall Ross
Senior Vice President
Telephone: (704) 386-8234
Telecopy: (740) 386-0892
WITNESSES AS TO
NATIONSBANC LEASING CORPORATION
OF NORTH CAROLINA, as the Holder
STATE OF )
) ss:
COUNTY OF )
The foregoing Trust Agreement was acknowledged before me, the undersigned
Notary Public, in the County of _____________ this ______ day of ______________,
1996 by _____________________, as ________________ of NationsBanc Leasing
Corporation of North Carolina, a North Carolina corporation, on behalf of the
corporation.
NATIONSBANC LEASING CORPORATION OF
NORTH CAROLINA
By:
Name:
Title:
[Notarial Seal]
Notary Public
My commission expires: ________________
AGREED TO:
Val T. Orton, in his individual capacity
c/o First Security Bank of Utah, N.A.
79 South Main Street
Salt Lake City, Utah 84111
Telecopy Number: (801) 246-5053
Telephone Number: (801) 246-5300
WITNESSES AS TO
Val T. Orton, in his individual capacity
STATE OF )
) ss:
COUNTY OF )
The foregoing Trust Agreement was acknowledged before me, the undersigned
Notary Public, in the County of _____________ this ______ day of ______________,
1996 by Val T. Orton.
Val T. Orton, in his individual capacity
[Notarial Seal]
Notary Public
My commission expires: ________________
EXHIBIT A
FORM OF HOLDER CERTIFICATE
FIRST SECURITY BANK OF UTAH, N.A.
TRUSTEE UNDER
TRUST AGREEMENT DATED AS OF FEBRUARY 6, 1996
HOLDER CERTIFICATE
GGC TRUST 1996-1
$_______________ February 6, 1996
First Security Bank of Utah, N.A., as trustee (herein in such capacity called
the "Owner Trustee") under that certain Trust Agreement dated as of February 6,
1996 (herein called the "Trust Agreement", the defined terms therein not
otherwise defined herein being used herein with the same meanings), between
NationsBanc Leasing Corporation of North Carolina as the Holder and the Owner
Trustee, hereby certifies as follows: (i) this Holder Certificate is the
Holder Certificate referred to in the Section 3.1(d) of the Trust Agreement,
which Holder Certificate has been issued by the Trustee pursuant to the Trust
Agreement and (ii) subject to the prior payment of, and to the assignment,
pledge or mortgage of the Trust Estate to secure the Notes as set forth in
the applicable Operative Agreements, the holder of this Holder Certificate
has an undivided beneficial interest in properties of the Owner Trustee
constituting part of the Trust Estate and is entitled to receive as provided
in the Trust Agreement, a portion of the Rent received or to be received by
the Owner Trustee for the Facility, as well as a portion of certain other
payments which may be received by the Trustee or the Holder pursuant to the
terms of the Operative Agreements as more particularly set forth therein.
All amounts payable hereunder and under the Trust Agreement shall be paid
only from the income and proceeds from the Trust Estate and only to the
extent that the Owner Trustee shall have received sufficient income or
proceeds from the Trust Estate to make such payments in accordance with the
terms of the Trust Agreement, except as specifically provided in Section 6.1
of the Trust Agreement; and the holder hereof, by its acceptance of this
Holder Certificate, agrees that it will look solely to the income and
proceeds from the Trust Estate to the extent available for distribution to the
holder hereof as provided in the Trust Agreement and to the income and proceeds
of the Holder Collateral under the Security Documents and that, except as
specifically provided in the Trust Agreement, the Owner Trustee is not
personally liable to the holder hereof for any amount payable under this
Holder Certificate or the Trust Agreement.
The amounts payable to the holder hereof pursuant to the Trust Agreement
shall be paid or caused to be paid by the Owner Trustee to, or for the
account of, the Holder, or its nominee, by transferring such amount in
immediately available funds to a bank institution or banking institutions
with bank wire transfer facilities for the account of the Holder or as
otherwise instructed in writing from time to time by the Holder.
This Holder Certificate shall be due on the Expiration Date. The Holder
Amount hereof, pursuant to the Trust Agreement, shall be redeemed in part in
the amounts and on the dates set forth in Schedule 1 of the Participation
Agreement.
This Holder Certificate shall bear a yield on the Holder Amount hereof from
time to time outstanding hereunder and under the Trust Agreement at the Holder
Yield as provided in the Trust Agreement. The Holder Yield on this Holder
Certificate shall be computed as provided in the Trust Agreement and shall be
payable at the rates, at the times and from the dates specified in the Trust
Agreement.
From and after the execution of the Participation Agreement, the rights of
the holder of this Holder Certificate under the Trust Agreement as well as
the beneficial interest of the holder of this Holder Certificate in and to
the properties of the Owner Trustee constituting part of the Trust Estate,
are subject and subordinate to the rights of the holders of the Notes to the
extent provided in the applicable Operative Agreements. The Trust Estate has
been or will be assigned, pledged and mortgaged to the Administrative Agent,
on behalf of the Lenders, as security for the Notes. Reference is hereby
made to the Trust Agreement, the Participation Agreement, the Credit
Agreement, the Security Agreement and the Notes for statements of the rights
of the holder of this Holder Certificate and of the rights of the holders of,
and the nature and extent of the security for, the Notes, as well as for a
statement of the terms and conditions of the trusts created by the Trust
Agreement, to all of which terms and conditions the holder hereof agrees by
its acceptance of this Holder Certificate.
The holder hereof, by its acceptance of this Holder Certificate, agrees not
to transfer this Holder Certificate except in accordance with the terms of the
Trust Agreement and the other Operative Agreements.
THIS HOLDER CERTIFICATE SHALL BE INTERPRETED AND THE RIGHTS AND
LIABILITIES OF THE PARTIES HERETO DETERMINED IN ACCORDANCE WITH THE
INTERNAL LAWS (AS OPPOSED TO CONFLICTS OF LAW PROVISIONS) AND DECISIONS
OF THE STATE OF GEORGIA. WHENEVER POSSIBLE EACH PROVISION OF THIS
HOLDER CERTIFICATE SHALL BE INTERPRETED IN SUCH MANNER AS TO BE
EFFECTIVE AND VALID UNDER APPLICABLE LAW, BUT IF ANY PROVISION OF THIS
HOLDER CERTIFICATE SHALL BE PROHIBITED BY OR INVALID UNDER APPLICABLE
LAW, SUCH PROVISION SHALL BE INEFFECTIVE TO THE EXTENT OF SUCH
PROHIBITION OR INVALIDITY, WITHOUT INVALIDATING THE REMAINDER OF SUCH
PROVISION OR THE REMAINING PROVISIONS OF THIS HOLDER CERTIFICATE.
IN WITNESS WHEREOF, the undersigned authorized officer of the Owner Trustee
has executed this Holder Certificate as of the date first set forth above.
FIRST SECURITY BANK OF UTAH, N.A.
as Owner Trustee
By:
Name:
Title:
AGREED TO:
Val T. Orton, subject to Section 6.9 of the Trust
Agreement, as Owner Trustee
EXHIBIT 10(b)
Drawn By and Mail To:
Moore & Van Allen, PLLC
NationsBank Corporate Center
100 North Tryon Street, Floor 47
Charlotte, North Carolina 28202-4003
Attention: Lea Stromire Johnson
LEASEHOLD MORTGAGE, ASSIGNMENT OF LEASES,
SECURITY AGREEMENT AND FINANCING STATEMENT
BE IT KNOWN, that on the dates and in the places hereinbelow set forth but
effective as of February 16, 1996, before the undersigned notaries public, duly
commissioned and qualified in and for the jurisdictions hereinbelow set forth,
and in the presence of the undersigned competent witnesses, personally came and
appeared:
FIRST SECURITY BANK OF UTAH, N.A., a national banking association,
represented herein by Brett R. King, its Trust Officer, duly
authorized by resolutions of the board of directors of said bank, a
certified copy of which resolutions is attached hereto and made a
part hereof, appearing herein and executing and delivering this
instrument not individually but solely as Owner Trustee under the
GGC Trust 1996-1 (hereinafter the "Grantor");
GEORGIA GULF CORPORATION, a Delaware corporation, represented herein
by Richard B. Marchese, its Vice President, duly authorized by
resolutions of the board of directors of said corporation, a
certified copy of which resolutions is attached hereto and made a
part hereof (hereinafter "Georgia Gulf");
VAL T. ORTON, subject to Section 6.9 of the Trust Agreement, as Owner
Trustee;
who declare that they do execute and deliver this Leasehold Mortgage, Assignment
of Leases, Security Agreement and Financing Statement (as amended, supplemented
or otherwise modified from time to time, the "Mortgage") for the benefit of
NATIONSBANC LEASING CORPORATION OF NORTH CAROLINA, for itself as Holder (as
referred to herein, either the "Holder" or the "Grantee") and for the
Administrative Agent in its capacity as agent for the Lenders and for the
purposes and on the terms and conditions hereinbelow set forth:
ARTICLE 1 - Certain Definitions; Granting Clauses;
Secured Obligations
Section 1.1. Certain Definitions and Reference Terms. For purposes
hereof, "Ground Lease" shall mean that certain ground lease dated as of the
date hereof from Georgia Gulf (as hereinafter defined), as landlord, to
Grantor, as tenant. To the extent any capitalized term is not defined herein,
such term shall have the meaning set forth in Appendix A to that certain
Participation Agreement dated as of February 6, 1996 (as amended, modified,
extended, supplemented, restated and/or replaced from time to time in
accordance with the terms thereof, the "Participation Agreement") by and
among Georgia Gulf, Grantor, Holder, various banks and other lending
institutions which are parties thereto (the "Lenders") and NationsBank of
Georgia, N.A., as administrative agent for the Lenders (the "Administrative
Agent").
Section 1.2. Mortgaged Property. Grantor does hereby, and GEORGIA GULF,
where applicable, does hereby, specifically mortgage, affect, hypothecate, and
grant a security interest in, to Grantee, for the benefit of Holder and the
Administrative Agent, the following:
(a) as to Grantor only, the Grantor's leasehold estate, as lessee
under a Ground Lease dated as of February 16, a memorandum of which was
recorded at Entry No. ________, COB ________, Page _________, on
__________, 1996 in the Conveyance Records of Iberville Parish, in the
real estate (herein called the "Land") described in Exhibit A which is
attached hereto and incorporated herein by reference and, as to Grantor
and Georgia Gulf, (i) all interests in the Land, all improvements now or
hereafter situated or to be situated on the Land (herein together called
the "Improvements"); and (ii) all right, title and interest of such party
in and to (1) all rights of ingress and egress to the roadway described
in Exhibit B which is attached hereto and incorporated herein by
reference; (2) any strips or gores between the Land and abutting or
adjacent properties; and (3) all water and water rights, timber, crops and
mineral interests on or pertaining to the Land (the Land, Improvements and
other rights, titles and interests referred to in this clause (a) being
herein sometimes collectively called the "Premises");
(b) as to Grantor and Georgia Gulf, all fixtures, equipment,
systems, machinery, furniture, furnishings, appliances, inventory, goods,
building and construction materials, supplies, and articles of personal
property, of every kind and character, now owned or hereafter acquired
by such party, which are now or hereafter attached to or situated in, on
or about the Land or the Improvements, or used in or necessary to the
complete and proper planning, development, use, occupancy or operation
thereof, or acquired (whether delivered to the Land or stored elsewhere)
for use or installation in or on the Land or the Improvements, and all
renewals and replacements of, substitutions for and additions to the
foregoing (the properties referred to in this clause (b) being herein
sometimes collectively called the "Accessories," all of which are hereby
declared to be permanent accessions to the Land);
(c) as to Grantor and Georgia Gulf, all (i) plans and specifications
for the Improvements; (ii) such party's rights, but not liability for any
breach by such party, under all insurance policies and other contracts and
general intangibles related to the Premises or the Accessories or the
operation thereof; (iii) deposits (including, but not limited to, such
party's rights in tenants' security deposits, deposits with respect to
utility services to the Premises, and any deposits or reserves for
taxes, insurance or otherwise), money, accounts, instruments, documents,
notes and chattel paper arising from or by virtue of any transactions
related to the Premises or the Accessories; (iv) to the extent
assignable, permits, licenses, franchises, certificates, development
rights, commitments and rights for utilities, and other rights and
privileges obtained in connection with the Premises or the Accessories;
(v) all leases for real and personal property, security deposits, rents,
royalties, bonuses, issues, profits, revenues and other benefits of the
Premises and the Accessories, including all accounts receivable, credit
card receivables, petty cash, guest room charges, reservation deposits,
advance payments and all income and revenue derived from guests,
conventions, room rentals, food sales, beverage sales, telephone usage,
vending machines, parking, catering, and all miscellaneous other income
(the "Rents and Profits"); (vi) oil, gas and other hydrocarbons and
other minerals produced from or allocated to the Land and all products
processed or obtained therefrom, and the proceeds thereof; and (vii)
engineering, accounting, title, legal and other technical or business data
concerning the Mortgaged Property (as hereinafter defined) which are in
the possession of such party or in which such party otherwise can grant
a security interest; and
(d) as to Grantor and Georgia Gulf, all (i) proceeds of or arising
from the properties, rights, titles and interests referred to above in
this Section 1.2, including but not limited to proceeds of any sale,
lease or other disposition thereof, proceeds of each policy of insurance
relating thereto, proceeds of the taking thereof or of any rights
appurtenant thereto, including change of grade of streets, curb cuts or
other rights of access, by eminent domain, expropriation or transfer in
lieu thereof for public or quasi-public use under any law, and proceeds
arising out of any damage thereto; and (ii) other interests of every
kind and character which such party now has or hereafter acquires in, to
or for the benefit of the properties, rights, titles and interests
referred to above in this Section 1.2 and all property used or useful in
connection therewith, including but not limited to rights of ingress and
egress and remainders, reversions and reversionary rights or interests;
and, as to Grantor only, if the estate of such party in any of the
property referred to above in this Section 1.2 is a leasehold estate,
this conveyance shall include, and the lien and security interest
created hereby shall encumber and extend to, all other or additional
title, estates, interests or rights which are now owned or may be
acquired hereafter by such party in or to the property demised under the
lease creating the leasehold estate;
TO HAVE AND TO HOLD the foregoing rights, interests and properties,
and all rights, estates, powers and privileges appurtenant thereto
(herein collectively called the "Mortgaged Property"), unto Grantee, and
its successors or successors and assigns. No part of the Mortgaged
Property constitutes all or any part of the homestead of Grantor or
Georgia Gulf.
Section 1.3. Security Interest. Grantor and Georgia Gulf hereby assign to
Grantee and grant to Grantee a security interest in all of the Mortgaged
Property which constitutes movable property (personal property) owned by such
party or fixtures (herein sometimes collectively called the "Collateral").
In addition to its rights hereunder or otherwise, Grantee shall have all of the
rights of a secured party under the Uniform Commercial Code in force in the
state where the Mortgaged Property is located or in any other state to the
extent the same is applicable law (the "UCC").
Section 1.4. Certificates, Note, Operative Agreements, Other Obligations.
This Mortgage is made to secure and enforce the payment and performance of the
following amounts, obligations, indebtedness, liabilities, certificates and
promissory notes and all renewals, extensions, supplements, increases, and
modifications thereof in whole or in part from time to time: (a) the amounts
and other obligations of any kind or type owing to the Grantee and/or the
Holder under any of the Operative Agreements, including specifically without
limitation any and all amounts evidenced by the Certificates and/or the Trust
Agreement; and (b) the indebtedness, amounts and other obligations of any
kind or type owing to Grantee, the Administrative Agent and/or any Lender
under any of the Operative Agreements, including specifically without
limitation any and all amounts evidenced by or owing under the Notes and/or
the Credit Agreement. The amounts, obligations, indebtedness, liabilities
and other items referred to in this Section 1.4, whether now existing or
hereafter arising, are hereinafter sometimes referred to as the "Secured
Obligations".
Section 1.5. Maximum Amount. The maximum amount secured that may be
outstanding at any time and from time to time that this Mortgage secures,
including without limitation as a mortgage and as a security agreement, and
including any advances made under Section 1.4 hereof and elsewhere as
authorized by this Mortgage and included within the secured amount, is One
Hundred Twenty Million Dollars ($120,000,000.00).
Section 1.6. Advances by Grantee. Grantor and Georgia Gulf authorize
Grantee to advance any sums necessary, limited only as hereinafter set forth,
for the purpose of paying (a) insurance premiums, (b) taxes, forced
contributions, service charges, local assessments and government charges, (c)
any liens or encumbrances affecting the Mortgaged Property (whether superior
or subordinate to the lien of this Mortgage) not permitted by this Mortgage,
(d) necessary repairs and maintenance expenses or (e) any other amounts which
Grantee deems necessary and appropriate to preserve the validity and ranking
of this Mortgage or as otherwise permitted hereunder, of whatever nature or
kind; provided, however, that nothing herein contained shall be construed as
making such advances obligatory upon Grantee, or as making Grantee liable for
any loss, damage, or injury resulting from the nonpayment thereof. Such
advances, up to additional maximum amount equal to 50% of the original
principal amount of the Secured Obligations, shall be exclusive of and in
addition to the principal and interest due on the Secured Obligations, and
shall be included in the amount secured hereby.
Section 1.6. Possession. Unless and until an Event of Default occurs (as
defined in Article 4), Grantor, or its designee, may remain in possession and
control of and operate and manage the Premises.
ARTICLE 2 - Representations, Warranties and Covenants
Section 2.1. Subject to the provisions of Section 6.18 hereof, Grantor and
Georgia Gulf represent, warrant, and covenant as follows:
(a) Performance of Obligation. Each of Grantor and Georgia Gulf will
timely and properly perform and comply with all of the covenants, agreements,
and conditions imposed upon such entity by this Mortgage within all
applicable grace periods.
(b) Creation of Lien Interest. Each of Grantor and Georgia Gulf warrants
that such entity has the valid right and power to grant this Mortgage.
(c) Nature of Transaction. Each of Grantor and Georgia Gulf warrants that
such entity is engaging in this transaction exclusively for business, commercial
or investment purposes.
(d) Ownership of Land. Georgia Gulf warrants that it holds unencumbered
title to the Land in full ownership, except for the Permitted Exceptions.
ARTICLE 3 - Assignment of Leases, Rents and Profits
Section 3.1 No Assignee Duties. With respect to the assignment of the
leases and agreements affecting the Premises and the Rents and Profits, the
Grantee shall not be obligated to perform or discharge any obligation or duty
to be performed or discharged by Grantor or Georgia Gulf, as applicable,
under any of the leases or agreements assigned under this Mortgage. Grantor
or Georgia Gulf, as applicable, hereby agrees to indemnify the Grantee for,
and to save it harmless from, any and all liability arising from any such
agreements or from such assignment in accordance with the Operative
Agreements. Such assignment shall not place responsibility for the control,
care, management or repair of the Premises upon the Grantee, or make the
Grantee responsible or liable for any negligence in the management,
operation, upkeep, repair or control of the Premises resulting in loss or
injury or death to any tenant, licensee, employee or stranger.
ARTICLE 4 - Event of Default
Section 4.1. Events of Default. The occurrence of any Event of Default
shall be an event of default under this Mortgage.
ARTICLE 5 - Remedies
Section 5.1. Certain Remedies. If an Event of Default shall occur,
Grantee may exercise (but shall have no obligation to exercise) any one or
more of the following remedies, without notice (unless notice is required by
applicable statute):
(a) Collection of Rents and Profits. Subject to the terms and conditions
of the Operative Agreements, Grantee may revoke the right of Grantor and
Georgia Gulf to collect Rents and Profits from the Premises and may collect
the rents and profits either itself or through a receiver.
(b) Foreclosure. Grantee shall have the right to foreclose the interest
of Grantor and Georgia Gulf in all or any part of the Mortgaged Property in
accordance with applicable law.
(c) Uniform Commercial Code. Without limitation of Grantee's rights of
enforcement with respect to the Collateral or any part thereof in accordance
with the procedures for foreclosure of real estate, Grantee may exercise its
rights of enforcement with respect to the Collateral or any part thereof
under the UCC as amended and in conjunction with, in addition to or in
substitution for those rights and remedies: (1) after appropriate court
approval, Grantee may enter upon the premises of the Grantor and/or Georgia
Gulf to take possession of, assemble and collect the Collateral or, to the
extent and for those items of the Collateral permitted under applicable law,
to render it unusable; (2) Grantee may require Grantor and Georgia Gulf to
assemble the Collateral and make it available at a place Grantee designates
which is mutually convenient to allow Grantee to take possession or dispose
of the Collateral; (3) written notice mailed to Grantor and Georgia Gulf as
provided herein at least five (5) days prior to the date of public sale of
the Collateral or prior to the date after which private sale of the
Collateral will be made shall constitute reasonable notice; (4) any sale made
pursuant to the provisions of this paragraph shall be deemed to have been a
public sale conducted in a commercially reasonable manner if held
contemporaneously with and upon the same notice as required for the sale of
the Mortgaged Property; (5) in the event of a foreclosure sale, whether made
under the terms hereof, or under judgment of a court, the Collateral and the
other Mortgaged Property, at the option of Grantee, may be sold as a whole;
(6) it shall not be necessary that Grantee take possession of the Collateral
or any part thereof prior to the time that any sale pursuant to the provisions
of this Section is conducted and it shall not be necessary that the Collateral
or any part thereof be present at the location of such sale; (7) with respect
to application of proceeds of disposition of the Collateral under Section 5.2
hereof, the costs and expenses incident to disposition shall include the
reasonable expenses of retaking, holding, preparing for sale or lease,
selling, leasing and the like and the reasonable attorneys' fees and legal
expenses incurred by Grantee; (8) any and all statements of fact or other
recitals made in any bill of sale or assignment or other instrument
evidencing any foreclosure sale hereunder as to nonpayment of the secured
amount or as to the occurrence of any default, or as to Grantee having
declared all of such amount to be due and payable, or as to notice of time,
place and terms of sale and of the properties to be sold having been duly
given, or as to any other act or thing having been duly done by Grantee,
shall be taken as prima facie evidence of the truth of the facts so stated
and recited; and (9) Grantee may appoint or delegate, or seek the appointment
of, any one or more persons as agent to perform any act or acts necessary or
incident to any sale held by Grantee, including the sending of notices and
the conduct of the sale, but in the name and on behalf of Grantee.
(d) Lawsuits. Grantee may proceed by a suit or suits in equity or at law,
whether for collection of the amount secured hereby, the specific performance of
any covenant or agreement herein contained or in aid of the execution of any
power herein granted, or for any foreclosure hereunder or for the sale of the
Mortgaged Property under the judgment or decree of any court or courts of
competent jurisdiction. Grantor and Georgia Gulf, for themselves, their
respective successors and assigns, do by these presents agree and stipulate
that it shall be lawful for, and Grantor and Georgia Gulf hereby authorize,
Grantee, upon the occurrence of a default, without making a demand or putting
in default (demand and putting in default being expressly waived), to cause all
and singular the Mortgaged Property to be seized and sold by executory or
ordinary process, without appraisement (appraisement being expressly waived),
either in its entirety or in lots or parcels, all as Grantee may determine,
to the highest bidder for cash or on such terms as the Grantee in such
proceedings may direct and otherwise exercise all rights, powers and remedies
afforded herein and otherwise afforded under applicable law.
(e) Entry on Mortgaged Property. Grantee is authorized, prior or
subsequent to the institution of any foreclosure proceedings, to the fullest
extent permitted by applicable law, to enter upon the Mortgaged Property, or
any part thereof, and to take possession of the Mortgaged Property and all
books and records relating thereto, and to exercise without interference from
Grantor or Georgia Gulf any and all rights which Grantor or Georgia Gulf has
with respect to the management, possession, operation, protection or
preservation of the Mortgaged Property. Grantee shall not be deemed to have
taken possession of the Mortgaged Property or any part thereof except upon
the exercise of its right to do so, and then only to the extent evidenced by
its demand and overt act specifically for such purpose. All costs, expenses
and liabilities of every character incurred by Grantee in managing,
operating, maintaining, protecting or preserving the Mortgaged Property shall
constitute a demand obligation of Grantor or Georgia Gulf (which obligation
each such entity hereby promises to pay) to Grantee pursuant to this Mortgage
except to the extent such costs, expenses or liabilities result from
Grantee's bad faith or through Grantee's gross negligence or willful
misconduct. If necessary to obtain the possession provided for above,
Grantee may invoke any and all legal remedies to dispossess Grantor and/or
Georgia Gulf. In connection with any action taken by Grantee pursuant to this
Section, Grantee shall not be liable for any loss sustained by Grantor and/or
Georgia Gulf resulting from any failure to let the Mortgaged Property or any
part thereof, or from any act or omission of Grantee in managing the
Mortgaged Property unless such loss is caused by the willful misconduct,
gross negligence and bad faith of Grantee, nor shall Grantee be obligated to
perform or discharge any obligation, duty or liability of Grantor or Georgia
Gulf arising under any lease or other agreement relating to the Mortgaged
Property or arising under any Permitted Lien or otherwise arising. Grantor
and Georgia Gulf hereby assent to, ratify and confirm any and all actions of
Grantee with respect to the Mortgaged Property taken under this Section.
(f) Keeper. In the event the Mortgaged Property, or any part thereof, is
seized as an incident to an action for the recognition or enforcement of this
Mortgage by executory process, ordinary process, sequestration, writ of fieri
facias or otherwise, Grantor, Georgia Gulf and Grantee agree that the court
issuing any such order shall, if petitioned for by Grantee, direct the
applicable sheriff to appoint as a keeper of the Mortgaged Property, the
Grantee or any agent designated by Grantee or any other person named by
Grantee at the time such seizure is effected. This designation is pursuant
to Louisiana Revised Statutes 9:5136 through 5140.2 inclusive, as the same
may be amended from time to time, and Grantee shall be entitled to all the
rights and benefits afforded thereunder. It is hereby agreed that the keeper
shall be entitled to receive as compensation, in excess of its reasonable
costs and expenses incurred in the administration or preservation of the
Mortgaged Property, an amount equal to $200.00 per month. The designation of
keeper made herein shall not be deemed to require Grantee to provoke the
appointment of such a keeper. Nothing herein is to be construed to deprive
Grantee of any other right, remedy or privilege it may have under the law to
have a keeper or receiver appointed. Any money advanced by Grantee in
connection with any such receivership shall be a demand obligation (which
obligation Grantor and Georgia Gulf hereby promise to pay) owing by Grantor
or Georgia Gulf to Grantee pursuant to this Mortgage.
(g) Confession of Judgment. For purposes of foreclosure under Louisiana
executory process procedures, Grantor and Georgia Gulf hereby acknowledge the
Secured Obligations and confess judgment in favor of Grantee for the full
amount of the secured amount.
Section 5.2. Proceeds of Foreclosure. The proceeds of any sale held by
Grantee or any receiver or public officer in foreclosure of the liens and
security interests evidenced hereby shall be applied as provided in Section
10.7 of the Participation Agreement attached hereto as Exhibit C.
Section 5.3. Grantee, Lenders as Purchaser. Grantee, the Holder, the
Administrative Agent or any Lender shall have the right to become the
purchaser at any sale held by Grantee or by any receiver or public officer
or at any public sale, and Grantee, the Holder, the Administrative Agent or any
Lender shall have the right to credit upon the amount of such party's successful
bid, to the extent necessary to satisfy such bid, all or any part of the
Secured Obligations in such manner and order as such party may elect.
Section 5.4. Foreclosure as to Matured Debt. Upon the occurrence of an
Event of Default, Grantee shall have the right to proceed with foreclosure
(judicial or nonjudicial) of the liens and security interests hereunder
without declaring the entire Secured Obligations due, and in such event any
such foreclosure sale may be made subject to the unmatured part of the
Secured Obligations; and any such sale shall not in any manner affect the
unmatured part of the Secured Obligations, but as to such unmatured part this
Mortgage shall remain in full force and effect just as though no sale had been
made. The proceeds of such sale shall be applied as provided in Section 10.7
of the Participation Agreement. Several sales may be made hereunder without
exhausting the right of sale for any unmatured part of the secured amount.
Section 5.5. Remedies Cumulative. All rights and remedies provided for
herein and in any other Operative Agreements are cumulative of each other and
of any and all other rights and remedies existing at law or in equity, and
Grantee, in addition to the rights and remedies provided herein or in any
other Operative Agreements (but subject to the provisions thereof), shall be
entitled to avail itself of all such other rights and remedies as may exist
now or hereafter at law or in equity for the collection of the secured amount
and the enforcement of the covenants herein and the foreclosure of the liens
and security interests evidenced hereby, and the resort to any right or
remedy provided for hereunder or under any such other Operative Agreements or
provided for by law or in equity shall not prevent the concurrent or
subsequent employment of any other appropriate right or rights or remedy or
remedies.
Section 5.6. Grantee's Discretion as to Security. Grantee may resort to
any security given by this Mortgage or to any other security now existing or
hereafter given to secure the payment of the Secured Obligations, in whole or
in part, and in such portions and in such order as may seem best to Grantee
in its sole and uncontrolled discretion, and any such action shall not in any
way be considered as a waiver of any of the rights, benefits, liens or
security interests evidenced by this Mortgage.
Section 5.7. Waiver of Certain Rights by Grantor and Georgia Gulf. To the
full extent Grantor and Georgia Gulf may do so, Grantor and Georgia Gulf agree
that Grantor and Georgia Gulf will not at any time insist upon, plead, claim or
take the benefit or advantage of any law now or hereafter in force providing
for any appraisement, valuation, stay, extension or redemption, and Grantor and
Georgia Gulf, for themselves, their respective heirs, devisees, representatives,
successors and assigns, and for any and all persons ever claiming any interest
in the Mortgaged Property, to the extent permitted by applicable law, hereby
waives and releases all rights of redemption, valuation, appraisement, stay
of execution, notice of intention to mature or declare due the whole of the
Secured Obligations, notice of election to mature or declare due the whole of
the Secured Obligations and all rights to a marshaling of assets of Grantor
and Georgia Gulf, including the Mortgaged Property, or to a sale in inverse
order of alienation in the event of foreclosure of the liens and/or security
interests hereby created. Grantor and Georgia Gulf shall not have or assert
any right under any statute or rule of law pertaining to the marshaling of
assets, sale in inverse order of alienation, the exemption of homestead, the
administration of estates of decedents, or other matters whatever to defeat,
reduce or affect the right of Grantee under the terms of this Mortgage to a
sale of the Mortgaged Property for the collection of the Secured Obligations
without any prior or different resort for collection, or the right of Grantee
under the terms of this Mortgage to the payment of the secured amount out of the
proceeds of sale of the Mortgaged Property in preference to every other
claimant whatever. Grantor and Georgia Gulf waive any right or remedy which
Grantor or Georgia Gulf may have or be able to assert pursuant to applicable
law, pertaining to the rights and remedies of sureties. If any law referred
to in this Section and now in force, of which Grantor, Georgia Gulf or their
respective heirs, devisees, representatives, successors or assigns or any
other persons claiming any interest in the Mortgaged Property might take
advantage despite this Section, hereafter shall be repealed or cease to be in
force, such law shall not thereafter be deemed to preclude the application of
this Section.
Section 5.8. Delivery of Possession After Foreclosure. In the event there
is a foreclosure sale hereunder and at the time of such sale, Grantor, Georgia
Gulf or their respective heirs, devisees, representatives, successors or assigns
are occupying or using the Mortgaged Property, or any part thereof, each and all
immediately shall become the tenant of the purchaser at such sale, which tenancy
shall be a tenancy from day to day, terminable at the will of either landlord or
tenant, at a reasonable rental per day based upon the value of the property
occupied, such rental to be due daily to the purchaser; and to the extent
permitted by applicable law, the purchaser at such sale, notwithstanding any
language herein apparently to the contrary, shall have the sole option to demand
possession immediately following the sale or to permit the occupants to remain
as tenants at will. In the event the tenant fails to surrender possession of
said property upon demand, the purchaser shall be entitled to institute and
maintain a summary action for possession of the property (such as an action
for eviction) in the court having jurisdiction.
ARTICLE 6 - Miscellaneous
Section 6.1. Scope of Mortgage. This Mortgage is a mortgage of both
immovable and movable property (both real and personal property), an
assignment of leases, a security agreement, a financing statement and a
collateral assignment, and also covers proceeds and fixtures.
Section 6.2. Effective as a Financing Statement. This Mortgage shall be
effective as a financing statement filed as a fixture filing with respect to
all fixtures included within the Mortgaged Property and is to be filed for
record in any parish in Louisiana. This Mortgage also shall be effective as a
financing statement covering any other Mortgaged Property and may be filed in
any other appropriate filing or recording office. The mailing addresses of
Grantor and Georgia Gulf are the addresses of Grantor and Georgia Gulf set
forth at the end of this Mortgage and the address of Grantee from which
information concerning the security interests hereunder may be obtained is
the address of Grantee set forth at the end of this Mortgage. A carbon,
photographic or other reproduction of this Mortgage or of any financing
statement relating to this Mortgage shall be sufficient as a financing
statement for any of the purposes referred to in this Section.
Section 6.3. Notice to Account Debtors. In addition to the rights granted
elsewhere in this Mortgage, Grantee at any time after an Event of Default may
notify the account debtors or obligors of any accounts, chattel paper,
negotiable instruments or other evidences of amounts included in the
Collateral to pay Grantee directly.
Section 6.4. Waiver by Grantee. Grantee at any time and from time to time
by a specific writing intended for the purpose may: (a) waive compliance by
Grantor or Georgia Gulf with any covenant herein made by Grantor or Georgia
Gulf to the extent and in the manner specified in such writing; (b) consent
to Grantor's or Georgia Gulf's doing any act which hereunder Grantor or Georgia
Gulf is prohibited from doing, or to Grantor's or Georgia Gulf's failing to do
any act which hereunder Grantor or Georgia Gulf is required to do, to the
extent and in the manner specified in such writing; (c) release any part of
the Mortgaged Property or any interest therein from the lien and security
interest of this Mortgage; or (d) release any party liable, either directly
or indirectly, for the secured amount or for any covenant herein or in any
other Operative Agreements, without impairing or releasing the liability of
any other party. No such act in any way shall affect the rights or powers of
Grantee hereunder except to the extent specifically agreed to by Grantee in
such writing.
Section 6.5. Special Louisiana Waivers. Grantor and Georgia Gulf waive in
favor of the Grantee, any and all homestead exemptions and other exemptions of
seizure or otherwise to which Grantor or Georgia Gulf is or may be entitled
under the constitution and statutes of the State of Louisiana insofar as the
Mortgaged Property is concerned. Grantor and Georgia Gulf further waive (a)
the benefit of appraisement as provided in Louisiana Code of Civil Procedure
Articles 2332, 2336, 2723 and 2724, and all other laws conferring the same;
(b) the demand and three days' delay accorded by Louisiana Code of Civil
Procedure Articles 2639 and 2721; (c) the notice of seizure required by
Louisiana Code of Civil Procedure Articles 2293 and 2721; (d) the three days'
delay provided by Louisiana Code of Civil Procedure Articles 2331 and 2772;
and (e) the benefit of the other provisions of Louisiana Code of Civil
Procedure Articles 2331, 2722 and 2723, not specifically mentioned above.
Section 6.6. No Impairment of Security. The lien, security interest and
other security rights of Grantee hereunder or under any other Operative
Agreements shall not be impaired by any indulgence, moratorium or release
granted by Grantee including, but not limited to, any renewal, extension or
modification which Grantee may grant with respect to any secured amount, or
any surrender, compromise, release, renewal, extension, exchange or
substitution which Grantee may grant in respect of the Mortgaged Property, or
any part thereof or any interest therein, or any release or indulgence
granted to any endorser, guarantor or surety of any secured amount. The taking
of additional security by Grantee shall not release or impair the lien, security
interest or other security rights of Grantee hereunder or affect the liability
of Grantor, Georgia Gulf or of any endorser, guarantor or surety, or improve
the right of any junior lienholder in the Mortgaged Property (without
implying hereby Grantee's consent to any junior lien).
Section 6.7. Acts Not Constituting Waiver by Grantee. Grantee may waive
any default without waiving any other prior or subsequent default. Grantee
may remedy any default without waiving the default remedied. Neither failure
by Grantee to exercise, nor delay by Grantee in exercising, nor
discontinuance of the exercise of any right, power or remedy (including but not
limited to the right to accelerate the maturity of the secured amount or any
part thereof) upon or after any default shall be construed as a waiver of
such default or as a waiver of the right to exercise any such right, power
or remedy at a later date. No single or partial exercise by Grantee of any
right, power or remedy hereunder shall exhaust the same or shall preclude any
other or further exercise thereof, and every such right, power or remedy
hereunder may be exercised at any time and from time to time. No
modification or waiver of any provision hereof nor consent to any departure
by Grantor or Georgia Gulf therefrom in any event shall be effective unless
the same shall be in writing and signed by Grantee and then such waiver or
consent shall be effective only in the specific instance, for the purpose for
which given and to the extent therein specified. No notice to nor demand on
Grantor or Georgia Gulf in any case shall of itself entitle Grantor or
Georgia Gulf to any other or further notice or demand in similar or other
circumstances. Remittances in payment of any part of the secured amount
other than in the required amount in immediately available U.S. funds shall
not, regardless of any receipt or credit issued therefor, constitute payment
until the required amount is actually received by Grantee in immediately
available U.S. funds and shall be made and accepted subject to the condition
that any check or draft may be handled for collection in accordance with the
practice of the collecting bank or banks. Acceptance by Grantee of any
payment in an amount less than the amount then due on any secured amount
shall be deemed an acceptance on account only and shall not in any way excuse
the existence of a default hereunder.
Section 6.8. Grantor's and Georgia Gulf's Successors. If the ownership of
the Mortgaged Property or any part thereof becomes vested in a person other than
Grantor or Georgia Gulf, Grantee, without notice to Grantor or Georgia Gulf,
may deal with such successor or successors in interest with reference to this
Mortgage and to the amount secured hereby in the same manner as with Grantor
or Georgia Gulf, without in any way vitiating or discharging Grantor's or
Georgia Gulf's liability hereunder or for the payment of the amount or
performance of the obligations secured hereby. No transfer of the Mortgaged
Property, no forbearance on the part of Grantee, and no extension of the
time for the payment of the amount secured hereby given by Grantee shall
operate to release, discharge, modify, change or affect, in whole or in part,
the liability of Grantor or Georgia Gulf hereunder for the payment of the
amount or performance of the obligations secured hereby or the liability of
any other person hereunder for the payment of the amounts secured hereby. The
Grantor and Georgia Gulf agree that they shall be bound by any modification of
this Mortgage or any of the other Operative Agreements made by Grantee and any
subsequent owner of the Mortgaged Property, with or without notice to such
party, and no such modifications shall impair the obligations of such party
under this Mortgage or any other Operative Agreement. Nothing in this
Section or elsewhere in this Mortgage shall be construed to imply Grantee's
consent to any transfer of the Mortgaged Property unless in accordance with
the Operative Agreements.
Section 6.9. Application of Payments to Certain Amount. If any part of the
secured amount cannot be lawfully secured by this Mortgage or if any part of the
Mortgaged Property cannot be lawfully subject to the lien and security interest
hereof to the full extent of such amount, then all payments made shall be
applied on said amount first in discharge of that portion thereof which is not
secured by this Mortgage.
Section 6.10. Notices. Unless otherwise specifically provided herein,
all notices, consents, directions, approvals, instructions, requests and other
communications required or permitted by the terms hereof to be given to any
Person shall be given in writing by United States mail, by nationally
recognized courier service or by hand and any such notice shall become
effective upon receipt and shall be directed to the address of such Person as
indicated on the signature pages to this Mortgage. From time to time any
party may designate a new address for purposes of notice hereunder by notice
to each of the other parties hereto and beneficiaries hereof.
Section 6.11. Invalidity of Certain Provisions. A determination that any
provision of this Mortgage is unenforceable or invalid shall not affect the
enforceability or validity of any other provision and the determination that
the application of any provision of this Mortgage to any person or
circumstance is illegal or unenforceable shall not affect the enforceability,
or validity of such provision as it may apply to other persons or circumstances.
Section 6.12. Gender; Titles; Construction. Within this Mortgage, words of
any gender shall be held and construed to include any other gender, and words in
the singular number shall be held and construed to include the plural, unless
the context otherwise requires. Titles appearing at the beginning of any
subdivisions hereof are for convenience only, do not constitute any part of
such subdivisions, and shall be disregarded in construing the language
contained in such subdivisions. The use of the words "herein," "hereof,"
"hereunder" and other similar compounds of the word "here" shall refer to
this entire Mortgage and not to any particular Article, Section, paragraph or
provision. The term "person" and words importing persons as used in this
Mortgage shall include firms, associations, partnerships (including limited
partnerships), joint ventures, trusts, corporations and other legal entities,
including public or governmental bodies, agencies or instrumentalities, as well
as natural persons.
Section 6.13. Execution; Recording. This Mortgage has been executed in
several counterparts, all of which are identical, and all of which
counterparts together shall constitute one and the same instrument. The date
or dates reflected on the signature pages hereto indicate the date or dates of
actual execution of this Mortgage, but such execution is as of the date shown on
the first page hereof, and for purposes of identification and reference the date
of this Mortgage shall be deemed to be the date reflected on the first page
hereof. Grantor and Georgia Gulf will cause this Mortgage and all amendments
and supplements thereto and substitutions therefor and all financing
statements and continuation statements relating thereto to be recorded,
filed, re-recorded and refiled in such manner and in such places as Grantee
shall reasonably request and will pay all such recording, filing,
re-recording and refiling taxes, fees and other charges.
Section 6.14. Successors and Assigns. The terms, provisions, covenants and
conditions hereof shall be binding upon Grantor and Georgia Gulf, and the heirs,
devisees, representatives, successors and assigns of Grantor and Georgia Gulf,
and shall inure to the benefit of Grantee and shall constitute covenants running
with the Land. All references in this Mortgage to Grantor and Georgia Gulf
shall be deemed to include all respective heirs, devisees, representatives,
successors and assigns of Grantor or Georgia Gulf, as the case may be.
Section 6.15. Modification or Termination. This Mortgage may be modified
or terminated only by a written instrument or instruments intended for that
purpose and executed by the party against which enforcement of the
modification or termination is asserted. Any alleged modification or
termination which is not so documented shall not be effective as to any party.
Section 6.16. Applicable Law. THIS MORTGAGE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF LOUISIANA AND THE LAWS OF THE
UNITED STATES APPLICABLE TO TRANSACTIONS IN LOUISIANA.
Section 6.17. Non-Recourse Obligations. The obligations under this
Mortgage and the other Operative Agreements are non-recourse as set forth in
the Operative Agreements.
Section 6.18. Georgia Gulf as a Party. Notwithstanding the terms and
provisions hereof, Georgia Gulf has executed this Mortgage not as Grantor but
for the purpose of subjecting to the lien hereof all of its right, title,
estate and interest, if any, in and to the Premises, Accessories and other
items set forth in Section 1.2 and for the purposes as otherwise specified
herein. Georgia Gulf acknowledges and agrees that, upon the occurrence of
an Event of Default, the Grantee shall have the right to exercise any or all
of its rights and remedies hereunder (or such as are otherwise available at
law or in equity) as against any such right, title, estate or interest of
Georgia Gulf in or to the items set forth in Section 1.2. Georgia Gulf
acknowledges and agrees that in the event it is deemed to have any interest
in the Mortgaged Property that it will undertake all covenants, obligations,
liabilities, responsibilities or duties under this Mortgage with respect to
such Mortgaged Property.
Section 6.19 Authentic Evidence. Any and all declarations of facts made
by authentic act before a notary public in the presence of two witnesses by a
person declaring that such facts lie within his or her knowledge, shall
constitute authentic evidence of such facts for the purpose of executory
process.
Section 6.20 Certificates. The production of mortgage, conveyance, tax
research or other certificates is waived by consent, and Grantor, Georgia Gulf
and Grantee agree to hold me, Notary, harmless for any failure to procure and
attach same.
THE WRITTEN OPERATIVE AGREEMENTS REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
THUS DONE AND PASSED in ___________________, ______________ on the ____
day of February, 1996, effective as of the effective date set forth above, in
the presence of the undersigned competent witnesses who hereunto sign their
names with Grantor, Val T. Orton and me, Notary, after due reading of the
whole.
WITNESSES: GRANTOR:
FIRST SECURITY BANK OF UTAH,
N.A., not individually but
solely as Owner Trustee under the GGC
Trust 1996-1
By
Title
Val T. Orton, subject to Section 6.9 of the Trust
Agreement, as Owner Trustee individual capacity
Notary Public
Printed Name:
My Commission Expires:
The address of
Grantor and Val T. Orton
is:
79 South Main Street
Salt Lake City, Salt Lake County, Utah 84111
Attn: Val T. Orton
Telecopy No: (801) 246-5053
First Security Bank of Utah N.A. Federal Tax No. 87-0131890
GGC Trust 1996-1 Federal Tax No. 87-6233127
Val T. Orton Social Security No. 528-68-9120
THUS DONE AND PASSED in ___________________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with Georgia Gulf and me, Notary, after due reading of the whole.
GEORGIA GULF:
WITNESSES: GEORGIA GULF CORPORATION
By
Title
Notary Public
Printed Name:
My Commission Expires:
The address and federal tax
identification number are:
Georgia Gulf Corporation
400 Perimeter Center Terrace
Suite 595
Atlanta, Georgia 30346
Attention: Samuel M. Hensley, Corporate Controller
Telephone: (770) 395-4577
Telecopy: (770) 395-4529
Federal Tax No. 58-1563799
The address of Grantee is:
NationsBanc Leasing Corporation of North Carolina
101 South Tryon Street
NC1-002-38-20
Charlotte, North Carolina 28255
Attention: M. Randall Ross
Senior Vice President
Telephone: (704) 386-8234
Telecopy: (704) 386-0892
Federal Tax No. 56-1047851
EXHIBIT 10(c)
PARTICIPATION AGREEMENT
Dated as of February 6, 1996
among
GEORGIA GULF CORPORATION,
as Construction Agent and as Lessee,
FIRST SECURITY BANK OF UTAH, N.A.,
not individually, except as expressly
stated herein, but solely as Owner Trustee
under the GGC Trust 1996-1
NATIONSBANC LEASING CORPORATION OF NORTH CAROLINA,
as the Holder
THE VARIOUS BANKS AND OTHER LENDING
INSTITUTIONS WHICH ARE PARTIES HERETO,
as the Lenders
and
NATIONSBANK, N.A. (SOUTH),
as Administrative Agent for the
Lenders
TABLE OF CONTENTS
Page
SECTION 1. THE LOANS.. . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 2. HOLDER FUNDINGS . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 3. SUMMARY OF TRANSACTIONS . . . . . . . . . . . . . . . . . . 2
3.1. Operative Agreements. . . . . . . . . . . . . . . . . . . . 2
3.2. Facility Acquisition. . . . . . . . . . . . . . . . . . . . 2
3.3. Acquisition and Installation of Equipment and Construction
of Additions; Lease or Disposition of the Facility . . . . 2
3.4. Ownership of the Facility . . . . . . . . . . . . . . . . . 2
SECTION 4. THE CLOSINGS. . . . . . . . . . . . . . . . . . . . . . . . 3
4.1. Initial Closing Date. . . . . . . . . . . . . . . . . . . . 3
4.2. Initial Closing Date; Facility Closing Date . . . . . . . . 4
SECTION 5. FUNDINGS; REPORTING REQUIREMENTS ON COMPLETION DATE;
LESSEE DELIVERY OF NOTICES; CERTAIN COVENANTS.. . . . . . . 4
5.1. General . . . . . . . . . . . . . . . . . . . . . . . . . . 4
5.2. Procedures for Funding. . . . . . . . . . . . . . . . . . . 4
5.3. Conditions to the Holder's and the Lenders' Obligations
to Fund Amounts on the Initial Closing Date and . . . . . . 5
5.4. Conditions to the Holder's and the Lenders' Obligations
to Make Construction Fundings for the Ongoing Construction
of the Facility Prior to the Basic Term Commencement Date . 8
5.5. Additional Reporting and Delivery Requirements on
Completion Date and on Construction Period Termination Date 10
5.6. Construction Agent Delivery of Construction Budget
Modifications 11
5.7. Final Schedules for Redemption of Holder Fundings and
Repayment of Loans; Final Percentages for Maximum Residual
Guarantee Amount 11
SECTION 6. CONDITIONS OF THE INITIAL CLOSING . . . . . . . . . . . . 11
6.1. Conditions to the Lessor's and the Holder's Obligations . 11
6.2. Conditions to the Lessee's Obligations. . . . . . . . . . 13
6.3. Conditions to the Obligations of the Administrative Agent
and the Lenders . . . . . . . . . . . . . . . . . . . . . 14
SECTION 7. REPRESENTATIONS AND WARRANTIES ON THE INITIAL CLOSING
DATE. . . . . . . . . . . . . . . . . . . . . . . . . . . 15
7.1. Representations and Warranties of the Holder. . . . . . . 15
7.2. Representations and Warranties of the Borrower. . . . . . 16
7.3. Representations and Warranties of the Construction Agent
and the Lessee. . . . . . . . . . . . . . . . . . . . . . 18
7.4. Representations and Warranties of the Administrative Agent 20
SECTION 8. REPRESENTATIONS AND WARRANTIES ON FUNDING DATES. . . . . . 21
8.1. Representations and Warranties on the Facility Closing Date 21
8.2. Representations and Warranties Upon Initial Construction
Fundings 23
8.3. Representations and Warranties Upon the Date of Each
Construction Funding that is not the Initial Funding. . . . 25
SECTION 9. PAYMENT OF CERTAIN EXPENSES.. . . . . . . . . . . . . . . 26
9.1. Transaction Expenses. . . . . . . . . . . . . . . . . . . 26
9.2. Brokers' Fees and Stamp Taxes . . . . . . . . . . . . . . 27
9.3. Certain Fees and Expenses . . . . . . . . . . . . . . . . 27
9.4. Unused Fee. . . . . . . . . . . . . . . . . . . . . . . . 28
9.5. Participation Fee.. . . . . . . . . . . . . . . . . . . . 28
SECTION 10. OTHER COVENANTS AND AGREEMENTS. . . . . . . . . . . . . . 28
10.1. Cooperation with the Construction Agent or the Lessee . . 28
10.2. Covenants of the Owner Trustee and the Holder . . . . . . 28
10.3. Lessee Covenants, Consent and Acknowledgment. . . . . . . 31
10.4. Sharing of Certain Payments . . . . . . . . . . . . . . . 33
10.5. Grant of Easements, etc.. . . . . . . . . . . . . . . . . 33
10.6. Appointment by the Administrative Agent, the Lenders,
the Holder and the Owner Trustee . . . . . . . . . . . . . 33
10.7. Collection and Allocation of Payments and Other Amounts . 35
10.8. Relative Rights of the Lenders and the Holder . . . . . . 38
SECTION 11. CREDIT AGREEMENT AND TRUST AGREEMENT. . . . . . . . . . . 39
11.1. Construction Agent's and Lessee's Credit Agreement Rights 39
11.2. Construction Agent's and Lessee's Trust Agreement Rights. 40
SECTION 12. TRANSFER OF INTEREST. . . . . . . . . . . . . . . . . . . 40
12.1. Restrictions on Transfer. . . . . . . . . . . . . . . . . 40
12.2. Effect of Transfer. . . . . . . . . . . . . . . . . . . . 40
SECTION 13. INDEMNIFICATION.. . . . . . . . . . . . . . . . . . . . . 41
13.1. General Indemnity . . . . . . . . . . . . . . . . . . . . 41
13.2 General Tax Indemnity . . . . . . . . . . . . . . . . . . 43
SECTION 14. MISCELLANEOUS.. . . . . . . . . . . . . . . . . . . . . . 48
14.1. Survival of Agreements. . . . . . . . . . . . . . . . . . 48
14.2. No Broker, etc. . . . . . . . . . . . . . . . . . . . . . 48
14.3. Notices . . . . . . . . . . . . . . . . . . . . . . . . . 48
14.4. Counterparts. . . . . . . . . . . . . . . . . . . . . . . 50
14.5. Amendments and Termination. . . . . . . . . . . . . . . . 50
14.6. Headings, etc.. . . . . . . . . . . . . . . . . . . . . . 50
14.7. Parties in Interest . . . . . . . . . . . . . . . . . . . 50
14.8. GOVERNING LAW; WAIVERS OF JURY TRIAL. . . . . . . . . . . 50
14.9. Severability. . . . . . . . . . . . . . . . . . . . . . . 51
14.10. Liability Limited . . . . . . . . . . . . . . . . . . . . 51
14.11. Rights of Lessee. . . . . . . . . . . . . . . . . . . . . 52
14.12. Further Assurances. . . . . . . . . . . . . . . . . . . . 52
14.13. Calculations under Operative Agreements . . . . . . . . . 52
14.14. Confidentiality . . . . . . . . . . . . . . . . . . . . . 53
14.15. Conversion of Transaction into a Secured Loan . . . . . . 54
14.16. Swap Agreement. . . . . . . . . . . . . . . . . . . . . . 54
14.17. Substitute Owner Trustee; Owner Trustee Advisor . . . . . 54
EXHIBITS
A - Forms of Requisition - Sections 4.2 and 5.2
B - Officer's Certificate - Section 5.6
C - Legal Opinion of Lessee's Counsel - Section 6.1(c)
D - Officer's Certificate - Section 6.1(g)
E - Officer's Certificate - Section 6.1(h)
F - Officer's Certificate - Section 6.2(d)
G - Officer's Certificate - Section 6.2(e)
H - Legal Opinion of Owner Trustee's Counsel - Section 6.2(f)
I - Description of Material Litigation
J - Form of Ground Lease - Section 5.3(e)
K- Form of Mortgage- Section 5.3(l)
L - Form of Memorandum of Ground Lease - Section 5.3(o)
SCHEDULES
1 - Redemption of Holder Amount
2 - Repayment of Loans
3 - Changes in Incorporated Representations and Warranties
Appendix A Rules of Usage and Definitions
PARTICIPATION AGREEMENT
THIS PARTICIPATION AGREEMENT dated as of February 6, 1996 (as amended,
modified, extended, supplemented, restated and/or replaced from time to time
in accordance with the applicable provisions hereof, this "Agreement") is by
and among GEORGIA GULF CORPORATION, a Delaware corporation ("Lessee" or the
"Construction Agent"); FIRST SECURITY BANK OF UTAH, N.A., a national banking
association, not individually (in its individual capacity, the "Trust
Company"), except as expressly stated herein, but solely as Owner Trustee
under the GGC Trust 1996-1 (the "Owner Trustee", the "Borrower" or the
"Lessor"); the lenders listed on the signature pages hereto (subject to the
definition of Lenders in Appendix A hereto, individually, a "Lender" and
collectively, the "Lenders"); NATIONSBANK, N.A. (SOUTH), a national banking
association, as administrative agent for the Lenders (in such capacity, the
"Administrative Agent"); and NATIONSBANC LEASING CORPORATION OF NORTH
CAROLINA, a North Carolina corporation, as the holder of the certificate
issued with respect to the GGC Trust 1996-1 (the "Holder"). Capitalized
terms used but not otherwise defined in this Agreement shall have the
meanings set forth in Appendix A hereto.
In consideration of the mutual agreements herein contained and other good
and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto hereby agree as follows:
SECTION I THE LOANS.
The Lenders have agreed to make Loans to the Lessor from time to time in an
aggregate principal amount of up to the aggregate amount of the Commitments of
the Lenders in order for the Lessor to acquire the Facility and the Equipment
and to construct the Additions in accordance with the Agency Agreement and the
terms and provisions hereof, and in consideration of the receipt of proceeds
of the Loans, the Lessor will issue the Notes. The Loans shall be made and
the Notes shall be issued pursuant to the Credit Agreement. Pursuant to
Section 5 of this Agreement and Section 2 of the Credit Agreement, the Loans
will be made to the Lessor from time to time at the request of the
Construction Agent in consideration for the Construction Agent agreeing for
the benefit of the Lessor, pursuant to the Agency Agreement, to acquire the
Facility, to acquire the Equipment, to construct the Additions and to cause
the Lessee to lease the Facility, each in accordance with the Agency
Agreement and the other Operative Agreements. The Loans and the obligations
of the Lessor under the Credit Agreement shall be secured by the Collateral.
SECTION II HOLDER FUNDINGS.
Subject to the terms and conditions of this Agreement and in reliance on
the representations and warranties of each of the parties hereto contained
herein or made pursuant hereto on each date Fundings are made in accordance
with Section 5 hereof, the Holder shall make a Holder Funding to the Lessor
with respect to the GGC Trust 1996-1 based on the Holder Commitment in an
amount in immediately available funds such that the Holder Funding on such
date shall be fifteen percent (15%) of the amount of the Requested Funds on
such date (except that in each case the Holder Funding shall be sufficient
to fund Holder Yield); provided, the Holder shall not be obligated for any
Holder Funding in excess of the Available Holder Commitment. The aggregate
amount of Holder Fundings shall be up to the amount of the Holder Commitment.
No redemption or any other return with respect to any Funding shall be
permitted such that the Holder Funding with respect to such Funding is less
than fifteen percent (15%) of the outstanding amount of such Funding, except
in connection with termination or expiration of the Term or in connection
with the exercise of remedies relating to the occurrence of an Event of
Default.
SECTION III SUMMARY OF TRANSACTIONS.
3.1 Operative Agreements. On the date hereof, each of the respective
parties hereto and thereto shall execute and deliver this Agreement, the
Lease, the Ground Lease, the Agency Agreement, the Credit Agreement, the
Notes, the Trust Agreement, the Certificate, the Security Agreement, the
Mortgage Instrument and such other documents, instruments, certificates and
opinions of counsel as agreed to by the parties hereto.
3.2 Facility Acquisition. On the Facility Closing Date and subject to
the terms and conditions of this Agreement (a) the Holder will make a Holder
Funding in accordance with Sections 2 and 5 of this Agreement and the terms
and provisions of the Trust Agreement, (b) the Lenders will each make Loans
in accordance with Sections 1 and 5 of this Agreement and the terms and
provisions of the Credit Agreement, and (c) the Lessor will lease the Land
pursuant to the Ground Lease and acquire good and marketable title to the
remainder of the Facility and grant to the Holder (for the benefit of itself
and the Administrative Agent (for the benefit of itself and the Lenders)) a
lien on such Ground Lease and the remainder of the Facility (and related
items) by execution of the required Security Documents.
3.3 Acquisition and Installation of Equipment and Construction of
Additions; Lease or Disposition of the Facility. Construction Fundings will
be made with respect to the Equipment to be acquired and installed, the
Additions to be constructed and with respect to ongoing Work regarding the
Equipment and construction of the Additions, in each case, pursuant to the
terms and conditions of this Agreement and the Agency Agreement. The
Construction Agent will act as a construction agent on behalf of the Lessor
respecting the Work regarding the acquisition, installation and testing
of the Equipment, the construction and testing of the Additions and the
expenditures of the Construction Fundings related to either of the foregoing.
The Construction Agent shall promptly notify the Lessor upon Completion and,
on or before the Construction Period Termination Date, the Lessee shall
execute and deliver to the Lessor the Lease Supplement, whereupon the Basic
Term shall commence.
3.4 Ownership of the Facility.
(a) The Lessor and the Lessee intend that (i) for financial
accounting purposes with respect to the Lessee (A) the Lease will be
treated as an "operating lease" pursuant to Statement of Financial
Accounting Standards No. 13, as amended, (B) the Lessor will be treated
as the owner and lessor of the Facility and (C) the Lessee will be
treated as the lessee of the Facility, but (ii) for federal and all
state and local income tax purposes, bankruptcy purposes, regulatory,
commercial law and real estate purposes and all other purposes (A) the
Lease will be treated as a financing arrangement and (B) the Lessee will
be treated as the owner of the Facility and will be entitled to all tax
benefits ordinarily available to owners of property similar to the
Facility for such tax purposes. Notwithstanding the foregoing, no 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, commercial or real estate
law or under any other set of rules. The Lessee shall claim the cost
recovery deductions associated with the Facility, and the Lessor shall not,
to the extent not prohibited by Law or GAAP, (and the Lessor shall cause
the Holder not to) take on its tax return a position inconsistent with
the Lessee's claim of such deductions.
(b) For all purposes other than as set forth in Section 3.4(a), the
Lessor and the Lessee intend the Lease to constitute a finance lease and
not a true lease. The Lessor and the Lessee further intend and agree
that, for the purpose of securing the Lessee's obligations thereunder,
(i) the Lease shall be deemed to be a security agreement and financing
statement within the meaning of Article 9 of the Uniform Commercial Code
respecting the Facility 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 and mortgage on the
Facility and all proceeds (including without limitation insurance
proceeds) thereof to the extent such is real property; (ii) the
acquisition of title in the Facility (excluding the Land) and a
leasehold interest in the Land pursuant to the Ground Lease referenced
in Article II of the Lease shall be deemed to be a grant by the Lessee
to the Lessor of, and the Lessee hereby grants to the Lessor, a lien on
and security interest, mortgage lien and deed of trust in all of the
Lessee's right, title and interest in and to the Facility (including the
Land) and all proceeds (including without limitation insurance proceeds)
of the conversion, voluntary or 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 the Facility; and (iii)
notifications to Persons holding such property, and acknowledgements,
receipts or confirmations from financial intermediaries, bankers or
agents (as applicable) of the 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. The Lessor and the Lessee
shall promptly take such actions as may be necessary or advisable in
either party's opinion (including without limitation the filing of
Uniform Commercial Code Financing Statements, Uniform Commercial Code
Fixture Filings and memoranda of the Lease and the Lease Supplement) to
ensure that the lien, security interest, mortgage lien and deed of trust
in the Facility 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.
SECTION IV THE CLOSINGS.
4.1 Initial Closing Date. All documents and instruments required to be
delivered on the Initial Closing Date shall be delivered at the offices of
Moore & Van Allen, PLLC, Charlotte, North Carolina, or at such other location
as may be determined by the Lessor, the Administrative Agent and the Lessee.
4.2 Initial Closing Date; Facility Closing Date; Construction Fundings.
The Construction Agent shall deliver to the Lessor and the Administrative Agent
a requisition (a "Requisition"), in the form attached hereto as Exhibit A or in
such other form as is reasonably satisfactory to the Lessor and the
Administrative Agent, in connection with (a) the Initial Closing Date
relating to the Transaction Expenses and other fees, expenses and
disbursements payable, pursuant to Section 9.1(a), by the Lessor and (b) on
the Facility Closing Date relating to the Acquisition Funding pursuant to
Section 5.3 and (c) each date of a Construction Funding pursuant to Section
5.4.
SECTION V FUNDINGS; REPORTING REQUIREMENTS ON COMPLETION DATE; LESSEE
DELIVERY OF NOTICES; CERTAIN COVENANTS.
5.1 General. To the extent funds have been advanced to the Lessor as
Loans by the Lenders and funded to the Lessor as Holder Fundings by the
Holder, the Lessor will use such funds from time to time in accordance with
the terms and conditions of this Agreement and the other Operative Agreements
(i) to pay interest on the Loans and to pay the Holder Yield on the Holder
Fundings, in each case to the extent accrued under the Credit Agreement or
Trust Agreement (as the case may be) during the period prior to the Basic
Term Commencement Date, (ii) to fund amounts to the Construction Agent to
permit the acquisition, design, engineering, construction, installation,
development, modification, renovation and testing, as applicable, of the
Facility in accordance with the terms of the Agency Agreement, and the other
Operative Agreements, and (iii) to pay Transaction Expenses.
5.2 Procedures for Funding.
(a) The Construction Agent shall designate the date for Fundings
hereunder in accordance with the terms and provisions hereof; provided,
however, it is understood and agreed that no more than two Fundings may
be requested during any calendar month; and provided, further, not more
than one of such Fundings may be based on a Eurodollar Rate. Not less
than (i) three (3) Business Days prior to the Initial Closing Date and
(ii) three (3) Business Days prior to the date on which any Construction
Funding is to be made, the Construction Agent shall deliver to the
Administrative Agent, (A) with respect to the Initial Closing Date and
the Facility Closing Date, a Requisition as described in Section 4.2
hereof (including without limitation a legal description of the Land, a
schedule of the Additions, if any, and a schedule of the Equipment, if
any, acquired or to be acquired on such date, each of the foregoing in
a form reasonably acceptable to the Administrative Agent) and (B) with
respect to each Construction Funding, a Requisition for which a Funding
is requested.
(b) Each Requisition shall: (i) be irrevocable, (ii) request funds
in an amount that is not in excess of the total aggregate of the
Available Commitments plus the Available Holder Commitment at such time,
and (iii) request that the Holder make a Holder Funding and that the
Lenders make Loans to the Lessor for the payment of the Facility Costs
(in the case of the Facility Closing Date) or other Facility Costs (in
the case of a Construction Funding) that have previously been incurred
and were not subject to a prior Requisition, in each case as specified
in the Requisition.
(c) Subject to the satisfaction of the conditions precedent set
forth in Sections 5.3, 5.4 or 5.5, as applicable, on the Facility
Closing Date or the date on which any Construction Funding is to be
made, as applicable, (i) the Lenders shall make Loans to the Lessor in
an aggregate amount equal to eighty-five percent (85%) of the Requested
Funds specified in any Requisition (except that in each case the Loans
shall be sufficient to pay interest then due and owing on the Loans), up
to an aggregate principal amount equal to the Available Commitments,
(ii) the Holder shall make a Holder Funding in an amount equal to fifteen
percent (15%) of the balance of the Requested Funds specified in such
Requisition (except that in each case the Holder Funding shall be
sufficient to fund Holder Yield), provided no such Holder Funding shall
exceed the Holder's Available Holder Commitment; and (iii) the total
amount of such Loans and the Holder Funding made on such date shall (x)
be used by the Lessor to pay Facility Costs within ten (10) Business Days
of the receipt by the Lessor of such Funding or if earlier, prior to the
date of the next Funding, (y) be used by the Lessor on the date of such
Funding to pay interest on the Loans and to pay the Holder Yield on the
Holder Fundings, in each case to the extent accrued under the Credit
Agreement or Trust Agreement (as the case may be) during the period
prior to the Basic Term Commencement Date, or (z) be funded by the
Lessor on the date of such Funding to the Construction Agent or the
Lessee to pay Facility Costs, as applicable.
(d) With respect to a Funding obtained by the Lessor to pay for
Facility Costs and not expended by Lessor for such purpose on the date
of such Funding, such amounts shall be held by the Lessor (or the
Administrative Agent on behalf of the Lessor) until the Facility Closing
Date or, if the Facility Closing Date does not occur within three (3)
Business Days of the date of the Lessor's receipt of such Funding, shall
be applied regarding the applicable Funding to repay the Lenders and to
return amounts to the Holder and, subject to the terms hereof, and of
the Credit Agreement and the Trust Agreement, shall remain available for
future Fundings. Any such amounts held by the Lessor (or the
Administrative Agent on behalf of the Lessor) shall be subject to the
lien of the Security Agreement.
(e) All items described in Sections 5.3, 5.4 or 5.5 which are to be
delivered to Lessor shall be delivered to Moore & Van Allen, PLLC, on
behalf of Lessor, and copies thereof shall be delivered to the
Administrative Agent and the Holder.
5.3 Conditions to the Holder's and the Lenders' Obligations to Fund
Amounts on the Initial Closing Date and on the Facility Closing Date. The
obligations of the Holder to make a Holder Funding, and of the Lenders to
make Loans to the Lessor, (i) on the Initial Closing Date to pay Transaction
Expenses, fees, expenses and other disbursements payable by the Lessor under
Section 9.1(a) of this Agreement and (ii) on the Facility Closing Date for
the purpose of providing funds to the Lessor necessary to pay the Transaction
Expenses, fees, expenses and other disbursements payable by the Lessor under
Section 9.1(b) of this Agreement (an "Acquisition Funding") in each case are
subject to the satisfaction on each such date of the following conditions
precedent (To the extent such conditions precedent require the delivery of
any agreement, certificate, instrument, memorandum, extract, legal opinion,
appraisal, commitment, title insurance commitment, lien report, opinion or any
other document of any kind or type, such shall be in form and substance
reasonably satisfactory to the Administrative Agent, the Holder and the
Lessor.):
(a) the correctness in all material respects of the representations
and warranties (including without limitation the Incorporated
Representations and Warranties) on each such date of the Lessor, the
Construction Agent and the Lessee contained herein and in each of the
other Operative Agreements;
(b) the performance in all material respects by the Construction
Agent and the Lessee of their respective agreements contained herein and
in the other Operative Agreements and to be performed by them on or
prior to such date;
(c) the Lessor shall have received a fully executed counterpart
copy of the Requisition, appropriately completed;
(d) title to the Facility shall conform in all material respects to
the representations and warranties set forth in Section 8.1(c) hereof;
(e) the Construction Agent shall have delivered to the Lessor a copy
of the Ground Lease (substantially in form of Exhibit J hereto) with
respect to the Land and existing Additions (if any) and a copy of the
Bill of Sale with respect to the Equipment (if any), respecting such of
the foregoing as are being acquired on each such date, and such Land,
existing Additions (if any) and Equipment (if any) shall be located in
the Approved State;
(f) there shall not have occurred and be continuing any Default or
Event of Default under any of the Operative Agreements and no Default or
Event of Default under any of the Operative Agreements will have occurred
after giving effect to the Funding requested by such Requisition;
(g) the Construction Agent shall have delivered to the Lessor, title
insurance commitments to issue policies in favor of the Administrative
Agent, the Holder and the Lessor from a title insurance company
reasonably acceptable to the Administrative Agent, the Holder and the
Lessor, with such title exceptions thereto as are reasonably acceptable
to the Administrative Agent, the Holder and the Lessor;
(h) the Construction Agent shall have delivered to the Lessor a
survey prepared by an independent recognized professional reasonably
acceptable to the Administrative Agent, the Holder and the Lessor;
(i) the Construction Agent shall have caused to be delivered to the
Lessor a legal opinion from Louisiana counsel reasonably acceptable to
the Administrative Agent, the Holder and the Lessor;
(j) the Administrative Agent, the Holder and the Lessor shall be
satisfied, in their reasonable discretion, that the acquisition and/or
holding of the Facility and the execution of the Mortgage Instrument and
the other Security Documents will not adversely affect the rights of the
Lessor, the Holder, the Administrative Agent or the Lenders under or
with respect to the Operative Agreements (it being understood and
acknowledged that the Administrative Agent, the Holder or the Lessor may
require that the Construction Agent deliver an acceptable legal opinion
in connection with this condition);
(k) the Construction Agent shall have delivered to the Lessor,
respecting the Facility, invoices for the various Transaction Expenses
and other fees, expenses and disbursements referenced in Sections 9.1(a)
or (b) of this Agreement, as appropriate;
(l) the Construction Agent shall have caused to be delivered to the
Lessor and there shall have been recorded by the Lessor a Mortgage
Instrument (substantially in form of Exhibit K hereto), Lessor Financing
Statements and the Lender Financing Statements and in the case of each
of the above, all necessary recording fees, documentary stamp taxes and
similar amounts shall have been paid by the Construction Agent;
(m) the Construction Agent shall have delivered to the Lessor a
memorandum regarding the Lease (such memorandum to be substantially in
the form attached as Exhibit B-2 to the Lease and in form suitable for
recording);
(n) with respect to the Acquisition Funding, the Available
Commitment (after giving effect to the Acquisition Funding) will be
sufficient to pay all amounts payable therefrom and to pay interest on
the Loans and the Holder Yield on the Holder Fundings to the extent
accrued under the Credit Agreement and the Trust Agreement, as the case
may be, during the period prior to the Basic Term Commencement Date;
(o) the Construction Agent shall have caused a lease memorandum
(substantially in form of Exhibit L hereto) to be delivered to the
Lessor for the Ground Lease;
(p) Counsel for the Lessee shall have issued to the Lessor, the
Holder, the Lenders and the Administrative Agent its opinion and
delivered the same to the Lessor;
(q) the Construction Agent shall have delivered to the Lessor a
preliminary construction budget (the "Construction Budget") for the
Equipment to be acquired and installed and the Additions to be
constructed on the Facility;
(r) the Construction Agent shall have provided evidence to the
Lessor of general and excess liability insurance with respect to the
Facility as provided in the Lease;
(s) the Construction Agent shall have caused an Appraisal to be
provided to the Lessor and the Holder from an appraiser selected by the
Administrative Agent and the Holder;
(t) all necessary (or in the reasonable opinion of the
Administrative Agent, the Holder, the Lessor or their respective
counsel, advisable) Governmental Actions, in each case required by any
law or regulation enacted, imposed or adopted on or prior to each such
date or by any change in facts or circumstances on or prior to each such
date, shall have been obtained or made and be in full force and effect;
(u) the Construction Agent shall cause an independent engineering
firm or other consultant (in any case, reasonably acceptable to the
Administrative Agent, the Holder and the Lessor) to certify to the
Administrative Agent on behalf of the Lenders, the Holder and the Lessor
(and to deliver the certificate to the Lessor) that (i) the Facility is
to be completed in accordance with the GE Construction Contract and (ii)
if so completed, (A) the Facility shall be both technically and
economically viable in view of the Lessee's proposed use of the Facility
and (B) no design, operational or other feature of the Facility shall
preclude the Facility from being a Qualifying Facility;
(v) the Construction Agent shall cause (i) Uniform Commercial Code
lien searches, tax lien searches and judgment lien searches regarding
each of the Lessee and the Lessor to be conducted (and copies thereof to
be delivered to the Lessor) in such jurisdictions as determined by the
Administrative Agent or the Holder by a nationally recognized search
company reasonably acceptable to the Administrative Agent, the Holder
and the Lessor and (ii) the liens referenced in such lien searches which
are objectionable to either the Administrative Agent or the Holder to be
either removed or otherwise handled in a manner satisfactory to the
Administrative Agent and the Holder;
(w) the Construction Agent shall have caused an extract regarding the
Trust Agreement to be delivered to the Lessor;
(x) the Construction Agent shall have caused the Contract Collateral
Assignment and the Contract Collateral Financing Statements to be
delivered to the Lessor;
(y) on or prior to the Facility Closing Date, the Construction Agent
shall have caused the Letter of Credit to be delivered to the Lessor.
5.4 Conditions to the Holder's and the Lenders' Obligations to Make
Construction Fundings for the Ongoing Construction of the Facility Prior to
the Basic Term Commencement Date. The obligations of the Holder to make a
Holder Funding, and the Lenders to make Loans, to the Lessor, (i) in
connection with all requests for Fundings subsequent to the acquisition of
the Facility (and to pay the Transaction Expenses, fees, expenses and other
disbursements payable by the Lessor under Section 9.1 of this Agreement in
connection therewith) and, (ii) to pay the Holder Yield on the Holder
Fundings and interest on the Loans, in each case regarding such Holder Yield
and Interest to the extent accrued and payable under the Trust Agreement or
the Credit Agreement (as the case may be), during the period prior to the
Basic Term Commencement Date, are subject to the satisfaction on each such
date of the following conditions precedent (To the extent such conditions
precedent require the delivery of any agreement, certificate, instrument,
memorandum, extract, legal opinion, appraisal, commitment, title insurance
commitment, lien report, opinion or any other document of any kind or type,
such shall be in form and substance reasonably satisfactory to the
Administrative Agent and the Lessor.):
(a) the correctness in all material respects on such date of the
representations and warranties (including without limitation the
Incorporated Representations and Warranties) of the Lessor, the
Construction Agent, the Lessee and the Holder contained herein and in
each of the other Operative Agreements;
(b) the performance in all material respects by the Construction
Agent and the Lessee of their respective agreements contained herein and
in the other Operative Agreements and to be performed by them on or
prior to each such date;
(c) the Lessor shall have received a fully executed counterpart of
the Requisition, appropriately completed;
(d) based upon the Construction Budget which shall satisfy the
requirements of this Agreement, the Available Commitments and the
Available Holder Commitment will be sufficient to complete the Facility;
(e) there shall not have occurred and be continuing any Default or
Event of Default under any of the Operative Agreements and no Default or
Event of Default under any of the Operative Agreements will have occurred
after giving effect to the Construction Funding requested by such
Requisition;
(f) the title insurance policy delivered in connection with the
requirements of Section 5.3(g) shall provide for (or shall be endorsed
to provide for) insurance in an amount at least equal to the maximum
total Facility Cost indicated by the Construction Budget referred to in
subparagraph (d) above and there shall be no title change or exception
objectionable to the Administrative Agent, the Holder or the Lessor;
(g) the Construction Agent shall have delivered to the Lessor
invoices for any Transaction Expenses and other fees, expenses and
disbursements referenced in Section 9.1 that are to be paid with the
Funding;
(h) the Construction Agent shall have delivered to the Lessor copies
of the Plans and Specifications for the Facility (or relevant portions
thereof, as applicable);
(i) all consents, licenses, permits, authorizations, assignments and
building permits required as of such date by all material Legal
Requirements or pursuant to the terms of any contract, indenture,
instrument or agreement for the acquisition, ownership, construction,
completion, occupancy, operation, leasing or subleasing of the Facility
have been obtained and are in full force and effect, except to the
extent that the failure to so obtain would not reasonably be expected
to, individually or in the aggregate, have a Material Adverse Effect;
and
(j) the Construction Agent shall have delivered, or cause to be
delivered, invoices, Bills of Sale or other documents reasonably
acceptable to the Administrative Agent, the Holder and the Lessor in
each case with regard to any Equipment then being acquired and naming
the Lessor as purchaser and transferee.
5.5 Additional Reporting and Delivery Requirements on Completion Date and
on Construction Period Termination Date. On the Completion Date for the
Facility, the Construction Agent shall deliver to the Lessor an Officer's
Certificate in the form attached hereto as Exhibit B specifying (a) the
address for the Facility, (b) the Completion Date for the Facility, (c) the
aggregate Facility Cost for the Facility, (d) detailed, itemized
documentation supporting the asserted Facility Cost figures, (e) the amount
of the asserted Facility Cost for personal property cost and real property
cost, in each case for purposes of determining appropriate amounts therefor
under the applicable Louisiana sales tax Laws, (f) all Equipment has been
acquired, installed and is operational and all Additions have been made in
accordance with all applicable material Legal Requirements in a good and
workmanlike manner in accordance with the Plans and Specifications (except to
the extent that any deviation from the Plans and Specifications could not
reasonably be expected to materially impair the value, utility, economic life
or operation of the Facility) and otherwise in full compliance with the
standards and practices of the Construction Agent with respect to equipment,
properties and additions owned by the Construction Agent, (g) the Facility is
a Qualifying Facility, (h) all consents, licenses, permits, authorizations,
assignments and building permits required as of such date by all material
Legal Requirements or pursuant to the terms of any contract, indenture,
instrument or agreement for the acquisition, ownership, construction,
completion, occupancy, operation, leasing or subleasing of the Facility have
been obtained and are in full force and effect, except to the extent that the
failure to so obtain would not reasonably be expected to, individually or in
the aggregate, have a Material Adverse Effect and (i) the Construction Agent
is satisfied that Final Completion (as such term is defined in the GE
Construction Contract) has been achieved in accordance with the terms and
provisions of the GE Construction Contract. The Administrative Agent, the
Holder and the Lessor shall have the right to contest the information
contained in such Officer's Certificate. Furthermore, on the Completion Date
for the Facility, the Construction Agent shall deliver or cause to be
delivered originals of the following to the Lessor each of which shall be in
form reasonably acceptable to the Administrative Agent, the Holder and the
Lessor: (u) certification from General Electric that Final Completion (as
such term is defined in the GE Construction Contract) has been achieved in
accordance with the terms and provisions of the GE Construction Contract,
(v) insurance certificates respecting the Facility as required hereunder and
under the Lease Agreement; (w) the Lease Supplement, (x) a memorandum of the
Lease and the Lease Supplement (in form suitable for recording), (y) if
requested by the Administrative Agent, the Holder or the Lessor, amendments to
the Lessor Financing Statements executed by the appropriate parties, and (z)
an Appraisal regarding the Facility. In addition, on the Completion Date for
the Facility the Construction Agent covenants and agrees that the recording
fees, documentary stamp taxes or similar amounts required to be paid in
connection with the related Mortgage Instrument shall be paid in an amount
required by applicable law.
5.6 Construction Agent Delivery of Construction Budget Modifications.
The Construction Agent covenants and agrees to deliver to the Administrative
Agent and the Lessor each month any modification to any Construction Budget
regarding the Facility; provided, no Construction Budget may be increased
unless (a) the title insurance policies referenced in Section 5.3(g) are also
modified or endorsed, if necessary, to provide for insurance in an amount
that satisfies the requirements of Section 5.4(f) of this Agreement, and (b)
after giving effect to any such amendment the Construction Budget remains in
compliance with the requirements of Section 5.4(d) of this Agreement.
5.7 Final Schedules for Redemption of Holder Fundings and Repayment of
Loans; Final Percentages for Maximum Residual Guarantee Amount. On or prior
to the Basic Term Commencement Date, the Administrative Agent (acting upon
the instruction of the Majority Lenders, excluding the Holder) and the Holder
shall revise Schedules 1 and 2 hereto and the percentages set forth in the
definition of "Maximum Residual Guarantee Amount" in Appendix A hereto based
on the Appraisal required to be delivered pursuant to Section 5.5 hereof, the
aggregate Facility Cost and the end of Term purchase option in favor of
Lessee. The revisions to Schedules 1 and 2 and to the percentages set forth
in the definition of "Maximum Residual Guarantee Amount" shall be subject to
the prior written consent of the Lessee, not to be unreasonably withheld.
Once Lessee has consented to the revised Schedules 1 and 2 and the revised
percentages for the definition of "Maximum Residual Guarantee Amount", such
schedules and percentages shall be deemed, for all purposes of the Operative
Agreement, to replace the versions of Schedules 1 and 2 attached to this
Participation Agreement and the percentages set forth in the definition of
"Maximum Residual Guarantee Amount" as of the Initial Closing Date. To the
extent such Lessee consent is not provided by Lessee, then Completion may not
be deemed to occur for purposes of the Operative Agreements unless such
Lessee consent is waived by the Administrative Agent (acting upon the
instruction of the Majority Lenders, excluding the Holder) and the Holder.
SECTION VI CONDITIONS OF THE INITIAL CLOSING.
6.1 Conditions to the Lessor's and the Holder's Obligations. The
obligations of the Lessor and the Holder to consummate the transactions
contemplated by this Agreement, including the obligation to execute and
deliver the applicable Operative Agreements to which each is a party on the
Initial Closing Date, are subject to (i) the accuracy and correctness in all
material respects on the Initial Closing Date of the representations and
warranties of the other parties hereto contained herein, (ii) the accuracy
and correctness in all material respects on the Initial Closing Date of the
representations and warranties of the other parties hereto contained in any
other Operative Agreement or certificate delivered pursuant hereto or
thereto, (iii) the performance in all material respects by the other parties
hereto of their respective agreements contained herein and in the other
Operative Agreements and to be performed by them on or prior to the Initial
Closing Date and (iv) the satisfaction or waiver by the Lessor and the Holder
of all of the following conditions on or prior to the Initial Closing Date:
(a) Each of the Operative Agreements to be entered into on the
Initial Closing Date shall have been duly authorized, executed and
delivered by the parties thereto, other than the Lessor, and shall be
in full force and effect, and no Default or Event of Default shall exist
thereunder (both before and after giving effect to the transactions
contmplated by the Operative Agreements), and the Lessor shall have
received a fully executed copy of each of the Operative Agreements (other
than the Notes of which it shall have received specimens). The Operative
Agreements (or memoranda or extracts thereof), any supplements thereto
and any financing statements and fixture filings in connection therewith
required under the Uniform Commercial Code shall have been filed or
shall be promptly filed, if necessary, in such manner as to enable the
Lessee's counsel to render its opinion referred to in Section 6.1(c)
hereof;
(b) All taxes, fees and other charges in connection with the
execution, delivery, recording, filing and registration of the
Operative Agreements shall have been paid or provisions for such
payment shall have been made to the reasonable satisfaction of the
Administrative Agent, the Holder and the Lessor;
(c) Counsel for the Lessee reasonably acceptable to the other
parties hereto shall have issued to the Lessor, the Administrative
Agent, the Lenders and the Holder its opinion in the form attached
hereto as Exhibit C or in such other form as is reasonably acceptable to
such parties;
(d) All necessary (or in the reasonable opinion of the
Administrative Agent, the Holder or the Lessor or their respective
counsel, advisable) Governmental Actions, in each case required by any
law or regulation enacted, imposed or adopted on or prior to the date
hereof or by any change in fact or circumstances on or prior to the
date hereof, shall have been obtained or made and be in full force and
effect;
(e) No action or proceeding shall have been instituted, nor shall
any action or proceeding be overtly threatened, before any Governmental
Authority, nor shall any order, judgment or decree have been issued or
proposed to be issued by any Governmental Authority, to set aside,
restrain, enjoin or prevent the full performance of this Agreement, any
other Operative Agreement or any transaction contemplated hereby or
thereby which is reasonably likely to have a Material Adverse Effect;
(f) In the reasonable opinion of the Lessor, the Administrative
Agent, the Holder and their counsel, the transactions contemplated by
the Operative Agreements do not and will not violate any material Legal
Requirements and do not and will not subject the Lessor, the Lenders,
the Administrative Agent or the Holder to any adverse regulatory
prohibitions or constraints, penalties or fines;
(g) The Lessor, the Administrative Agent and the Holder shall each
have received an Officer's Certificate, dated as of the Initial Closing
Date, of the Lessee in the form attached hereto as Exhibit D or in such
other form as is reasonably acceptable to such parties stating that (i)
each and every representation and warranty of the Lessee contained in
the Operative Agreements to which it is a party is true and correct in
all material respects on and as of the Initial Closing Date; (ii) no
Default or Event of Default has occurred and is continuing under any
Operative Agreement; (iii) each Operative Agreement to which Lessee is a
party is in full force and effect with respect to it; and (iv) the
Lessee has performed and complied with all covenants, agreements and
conditions contained herein or in any Operative Agreement required to be
performed or complied with by it on or prior to the Initial Closing
Date;
(h) The Lessor, the Administrative Agent and the Holder shall each
have received (i) a certificate of the Secretary or an Assistant Secretary
of Lessee in the form attached hereto as Exhibit E or in such other form
as is reasonably acceptable to such parties attaching and certifying as
to (1) the resolutions of its Board of Directors duly authorizing the
execution, delivery and performance by the Lessee of each of the
Operative Agreements to which it is or will be a party, (2) its
certificate of incorporation certified as of a recent date by the
Secretary of State of the State of Delaware and its by-laws, and (3)
the incumbency and signature of persons authorized to execute and
deliver on its behalf the Operative Agreements to which it is a party
and (ii) a good standing certificate from the appropriate officer of the
State of Delaware as to its good standing in such state; and
(i) As of the Initial Closing Date, there shall not have occurred
any material adverse change in the consolidated assets, liabilities,
operations, business or financial condition of the Lessee from that set
forth in the audited financial statements of the Lessee dated December
31, 1995.
6.2 Conditions to the Lessee's Obligations. The obligation of the Lessee
to consummate the transactions contemplated by this Agreement, including the
obligation to execute and deliver the Operative Agreements to which it is a
party on the Initial Closing Date, is subject to (i) the accuracy and
correctness on the Initial Closing Date of the representations and warranties
of the other parties hereto contained herein, (ii) the accuracy and correctness
on the Initial Closing Date of the representations and warranties of the other
parties hereto contained in any other Operative Agreement or certificate
delivered pursuant hereto or thereto, (iii) the performance by the other
parties hereto of their respective agreements contained herein and in the
other Operative Agreements, in each case to be performed by them on or prior
to the Initial Closing Date, and (iv) the satisfaction or waiver by the
Lessee of all of the following conditions on or prior to the Initial Closing
Date:
(a) In the reasonable opinion of the Lessee and its counsel, the
transactions contemplated by the Operative Agreements do not and will
not violate any material Legal Requirements and do not and will not
subject the Lessee to any adverse regulatory prohibitions or
constraints;
(b) No action or proceeding shall have been instituted nor shall any
action or proceeding be overtly threatened, before any Governmental
Authority, nor shall any order, judgment or decree have been issued or
proposed to be issued by any Governmental Authority, to set aside,
restrain, enjoin or prevent the full performance of this Agreement, any
other Operative Agreement or any transaction contemplated hereby or
thereby which is reasonably likely to have a Material Adverse Effect;
(c) Each of the Operative Agreements to be entered into on the
Initial Closing Date shall have been duly authorized, executed and
delivered by the parties thereto, other than the Lessee, and shall be
in full force and effect, and the Lessee shall have received a fully
executed copy of each of the Operative Agreements;
(d) The Lessee, the Holder and the Administrative Agent shall have
received an Officer's Certificate of the Lessor dated as of the Initial
Closing Date in the form attached hereto as Exhibit F or in such other
form as is reasonably acceptable to Lessee and the Administrative Agent,
stating that (i) each and every representation and warranty of the
Lessor contained in the Operative Agreements to which it is a party is
true and correct on and as of the Initial Closing Date; (ii) each
Operative Agreement to which the Lessor is a party is in full force and
effect with respect to it, and (iii) the Lessor has duly performed and
omplied with all covenants, agreements and conditions contained herein
or in any Operative Agreement required to be performed or complied with
by it on or prior to the Initial Closing Date;
(e) The Lessee, the Holder and the Administrative Agent shall have
received (i) a certificate of the Secretary, an Assistant Secretary,
Trust Officer or Vice President of the Trust Company in the form
attached hereto as Exhibit G or in such other form as is reasonably
acceptable to Lessee and the Administrative Agent, attaching and
certifying as to (A) the signing resolutions duly authorizing the
execution, delivery and performance by the Lessor of each of the
Operative Agreements to which it is or will be a party (B) its articles
of association or other equivalent charter documents and its by-laws,
as the case may be, certified as of a recent date by an appropriate
officer of the Trust Company, and (C) the incumbency and signature of
persons authorized to execute and deliver on its behalf the Operative
Agreements to which it is a party and (ii) a good standing certificate
from the Office of the Comptroller of the Currency; and
(f) Counsel for the Lessor acceptable to the other parties hereto
shall have issued to the Lessee, the Holder, the Lenders and the
Administrative Agent its opinion in the form attached hereto as Exhibit
H or in such other form as is reasonably acceptable to such parties.
6.3 Conditions to the Obligations of the Administrative Agent and the
Lenders. The obligations of the Administrative Agent and the Lenders to
consummate the transactions contemplated by this Agreement, including the
obligation to execute and deliver each of the Operative Agreements to which
any such entity is a party on the Initial Closing Date, is subject to (i) the
accuracy and correctness in all material respects on the Initial Closing
Date of the representations and warranties of the other parties hereto
contained herein, (ii) the accuracy and correctness in all material respects
on the Initial Closing Date of the representations and warranties of the
other parties hereto contained in any other Operative Agreement or
certificate delivered pursuant hereto or thereto, (iii) the performance in
all material respects by the other parties hereto of their respective
agreements contained herein and in the other Operative Agreements, in each
case to be performed by them on or prior to the Initial Closing Date, and
(iv) the receipt by the Administrative Agent of the items required
to be delivered to the Administrative Agent pursuant to this Section 6.
SECTION VII REPRESENTATIONS AND WARRANTIES ON THE INITIAL CLOSING DATE.
7.1 Representations and Warranties of the Holder. Effective as of the
Initial Closing Date, the Holder represents and warrants to each of the
other parties hereto that:
(a) NationsBanc Leasing Corporation of North Carolina is a
corporation duly organized, validly existing and in good standing under
the laws of the State of North Carolina and has the power and authority
to carry on its business as now conducted and to enter into and perform
its obligations under each Operative Agreement to which it is or is to
be a party and each other agreement, instrument and document to be
executed and delivered by it on or before each Closing Date in
connection with or as contemplated by each such Operative Agreement to
which it is or will be a party;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party have been duly authorized
by all necessary action on its part and neither the execution and
delivery thereof, nor the consummation of the transactions contemplated
thereby, nor compliance by it with any of the terms and provisions
thereof (i) requires or will require any approval of the stockholders
of, or approval or consent of any trustee or holder of any indebtedness
or obligations of, the Holder which have not been obtained, (ii)
contravenes or will contravene any Legal Requirement applicable to or
binding on it (except no representation or warranty is made as to any
Legal Requirement to which it may be subject solely as a result of the
activities of the Lessee) as of the date hereof, (iii) contravenes or
will contravene or result in any breach of or constitute any default
under, or result in the creation of any Lien upon the Facility, any of
the Equipment or any of the Additions (other than Liens created by the
Operative Agreements) or any of its other property under its certificate
of incorporation or other equivalent charter documents, by-laws or any
indenture, mortgage, chattel mortgage, deed of trust, conditional sales
contract, bank loan or credit agreement or other agreement or instrument
to which it is a party or by which it or its properties is bound or
affected or (iv) does or will require any Governmental Action by any
Governmental Authority (other than arising solely by reason of the
business, condition or activities of the Lessee or any Affiliate thereof
or the construction or use of the Facility, the Equipment or the
Additions);
(c) Each Operative Agreement to which it is or will be a party has
been, or will be, duly executed and delivered by it and constitutes, or
upon execution and delivery will constitute, a legal, valid and binding
obligation enforceable against it in accordance with the terms thereof;
(d) There is no action or proceeding pending or, to its knowledge,
threatened against it before any Governmental Authority that questions
the validity or enforceability of any Operative Agreement to which it
is or will become a party or that, if adversely determined, would
materially and adversely affect its ability to perform its obligations
under the Operative Agreements to which it is a party;
(e) It has not assigned or transferred any of its right, title or
interest in or under the Lease except in accordance with the Operative
Agreements;
(f) No Default or Event of Default under the Operative Agreements
attributable to it has occurred and is continuing;
(g) It is not a "holding company" or a "subsidiary company" of a
"holding company" or an "affiliate" of a "holding company' or a "public
utility" within the meaning of the Public Utility Holding Company Act of
1935, as amended, or a "public utility" within the meaning of the
Federal Power Act, as amended. It is not an "investment company" or a
company controlled by an "investment company" within the meaning of the
Investment Company Act or an "investment adviser" within the meaning of
the Investment Advisers Act of 1940, as amended;
(h) Except as otherwise contemplated by the Operative Agreements, it
shall not, nor shall it direct the Lessor to, use the proceeds of any Loan
or Holder Funding for any purpose other than the purchase and/or lease of
the Facility, the acquisition and installation of the Equipment, the
construction of the Additions, the payment of the Transaction Expenses
and the fees, expenses and other disbursements referenced in Section 9.1
of this Agreement and the payment of the interest on the Loans and the
Holder Yield on the Holder Fundings which accrues prior to the Basic
Term Commencement Date; and
(i) It is acquiring its interest in the Trust Estate for its own
account for investment and not with a view to any distribution (as such
term is used in Section 2(11) of the Securities Act) thereof, and if in
the future it should decide to dispose of its interest in the Trust
Estate, it understands that it may do so only in compliance with the
Securities Act and the rules and regulations of the Securities and
Exchange Commission thereunder and any applicable state securities laws.
Neither it nor anyone authorized to act on its behalf has taken or will
take any action which would subject the issuance or sale of any interest
in the Facility, the Trust Estate or the Lease to the registration
requirements of Section 5 of the Securities Act. No representation or
warranty contained in this Section 7.1(i) shall include or cover any
action or inaction of the Lessee or any Affiliate thereof whether or
not purportedly on behalf of the Holder, the Borrower or any of their
Affiliates.
7.2 Representations and Warranties of the Borrower. Effective as of the
Initial Closing Date, Trust Company in its individual capacity and as the
Borrower, as indicated, represents and warrants to each of the other parties
hereto as follows, provided, that the representations in the following
paragraphs (h), (i), (j) and (k) are made solely in its capacity as the
Borrower:
(a) It is a national banking association and is duly organized and
validly existing and in good standing under the laws of the United States
of America and has the power and authority to enter into and perform its
obligations under the Trust Agreement and (assuming due authorization,
execution and delivery of the Trust Agreement by the Holder) has the
corporate and trust power and authority to act as the Owner Trustee and
to enter into and perform the obligations under each of the other
Operative Agreements to which Trust Company or the Owner Trustee, as
the case may be, is or will be a party and each other agreement,
instrument and document to be executed and delivered by it on or before
such Closing Date in connection with or as contemplated by each such
Operative Agreement to which Trust Company or the Owner Trustee, as the
case may be, is or will be a party;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party, either in its individual
capacity or (assuming due authorization, execution and delivery of the
Trust Agreement by the Holder) as the Owner Trustee, as the case may be,
have been duly authorized by all necessary action on its part and
neither the execution and delivery thereof, nor the consummation of the
transactions contemplated thereby, nor compliance by it with any of the
terms and provisions thereof (i) requires or will require any approval
or consent of any trustee or holders of any of its indebtedness or
obligations, (ii) contravenes or will contravene any Legal Requirement
relating to its banking or trust powers, (iii) contravenes or will
contravene or result in any breach of or constitute any default under,
or result in the creation of any Lien upon any of its property under,
(A) its charter or by-laws, or (B) any indenture, mortgage, chattel
mortgage, deed of trust, conditional sales contract, bank loan or credit
agreement or other agreement or instrument to which it is a party or by
which it or its properties may be bound or affected, which
contravention, breach, default or Lien under clause (B) would materially
and adversely affect its ability, in its individual capacity or as Owner
Trustee, to perform its obligations under the Operative Agreements to
which it is a party or (iv) requires or will require any Governmental
Action by any Governmental Authority regulating its banking or trust
powers;
(c) The Trust Agreement and, assuming the Trust Agreement is the
legal, valid and binding obligation of the Holder, each other Operative
Agreement to which Trust Company or the Owner Trustee, as the case may
be, is or will be a party have been, or on or before such Closing Date
will be, duly executed and delivered by Trust Company or the Owner
Trustee, as the case may be, and the Trust Agreement and each such other
Operative Agreement to which Trust Company or the Owner Trustee, as the
case may be, is a party constitutes, or upon execution and delivery will
constitute, a legal, valid and binding obligation enforceable against
Trust Company or the Owner Trustee, as the case may be, in accordance
with the terms thereof;
(d) There is no action or proceeding pending or, to its knowledge,
threatened to which it is or will be a party, either in its individual
capacity or as the Owner Trustee, before any Governmental Authority
that, if adversely determined, would materially and adversely affect its
ability, in its individual capacity or as Owner Trustee, to perform its
obligations under the Operative Agreements to which it is a party or
would question the validity or enforceability of any of the Operative
Agreements to which it is or will become a party;
(e) It has not assigned or transferred any of its right, title or
interest in or under the Lease or the Agency Agreement except in
accordance with the Operative Agreements;
(f) No Default of Event of Default under the Operative Agreements
attributable to it has occurred and is continuing;
(g) Except as otherwise contemplated in the Operative Agreements,
the proceeds of the Loans and Holder Fundings shall not be applied by
the Owner Trustee for any purpose other than the payment of Transaction
Expenses and the fees, expenses and other disbursements referenced in
Sections 9.1(a) and (b) of this Agreement, the purchase and/or lease of
the Facility, the acquisition and installation of the Equipment, the
construction of the Additions and the payment of interest on the Loans
and the payment of the Holder Yield on the Holder Fundings, in each case
to the extent accrued under the Credit Agreement or Trust Agreement (as
the case may be) during the period prior to the Basic Term Commencement
Date;
(h) Neither the Owner Trustee nor any Person authorized by the Owner
Trustee to act on its behalf has offered or sold any interest in the Trust
Estate or the Notes, or in any similar security relating to the Facility,
or in any security the offering of which for the purposes of the Securities
Act would be deemed to be part of the same offering as the offering of
the aforementioned securities to, or solicited any offer to acquire any
of the same from, any Person other than, in the case of the Notes, the
Administrative Agent, and neither the Owner Trustee nor any Person
authorized by the Owner Trustee to act on its behalf will take any
action which would subject, as a direct result of such action alone, the
issuance or sale of any interest in the Trust Estate or the Notes to the
provisions of Section 5 of the Securities Act or require the
qualification of any Operative Agreement under the Trust Indenture Act
of 1939, as amended;
(i) The Owner Trustee's chief place of business, chief executive
office and office where the documents, accounts and records relating to
the transactions contemplated by this Agreement and each other Operative
Agreement are kept are located at 79 South Main Street, Salt Lake City,
Utah 84111;
(j) The Owner Trustee is not engaged principally in, and does not
have as one of its important activities, the business of extending
credit for the purpose of purchasing or carrying any margin stock
(within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System of the United States), and no part of the
proceeds of the Loans or the Holder Fundings will be used by it to
purchase or carry any margin stock or to extend credit to others for the
purpose of purchasing or carrying any such margin stock or for any
purpose that violates, or is inconsistent with, the provisions of
Regulations G, T, U, or X of the Board of Governors of the Federal
Reserve System of the United States; and
(k) The Owner Trustee is not an "investment company" or a company
controlled by an "investment company" within the meaning of the
Investment Company Act.
7.3 Representations and Warranties of the Construction Agent and the
Lessee. Effective as of the Initial Closing Date the Construction Agent and
the Lessee represent and warrant to each of the other parties hereto that:
(a) The Incorporated Representations and Warranties are true and
correct in all material respects except for such matters set forth on
Schedule 3 hereto and the Lessee has delivered to each of the Lenders
and Holder the most recent audited and quarterly financial statements
and other reports required to be delivered pursuant to Section 9.01 of
the GGC Credit Agreement.
(b) The execution and delivery by each of the Construction Agent and
the Lessee of this Agreement and the other Operative Agreements and the
performance by each of the Construction Agent and the Lessee of its
respective obligations under this Agreement and the other Operative
Agreements are within the corporate powers of each of the Construction
Agent and the Lessee, have been duly authorized by all necessary
corporate action on the part of each of the Construction Agent and the
Lessee (including any necessary shareholder action), have received all
necessary governmental approval, and do not and will not (i) violate
any material Legal Requirement which is binding on any of the
Construction Agent, the Lessee or any of their Subsidiaries, (ii)
contravene or conflict with, or result in a breach of, any provision of
the Certificate of Incorporation, By-Laws or other organizational
documents of any of the Construction Agent or the Lessee or any of their
Subsidiaries or of any agreement, indenture, instrument or other
document which is binding on any of the Construction Agent or the Lessee
or any of their Subsidiaries or (iii) result in, or require, the
creation or imposition of any Lien (other than pursuant to the terms of
the Operative Agreements) on any asset of any of the Construction Agent
or the Lessee or any of their Subsidiaries.
(c) This Agreement is, and upon the execution and delivery thereof
the other Operative Agreements will be, the legal, valid and binding
obligation of each of the Construction Agent and the Lessee, enforceable
against each of the Construction Agent and the Lessee in accordance with
their terms. The Construction Agent and the Lessee have each executed
the various Operative Agreements required to be executed as of the
Initial Closing Date.
(d) The GE Construction Contract is in full force and effect, is
enforceable in accordance with its terms and provides for Completion in
accordance with (i) the terms thereof, (ii) the Plans and Specifications
and (iii) the representations and warranties regarding the Facility made
by Georgia Gulf Corporation in or in connection with the Operative
Agreements. Georgia Gulf Corporation is not in default under the GE
Construction Contract, and to the best knowledge of Georgia Gulf
Corporation, General Electric is not in default under the GE
Construction Contract.
(e) No Governmental Action by any Governmental Authority or
authorization, registration, consent, approval, waiver, notice or other
action by, to or of any other Person is required to authorize or is
required in connection with (i) the execution, delivery or performance
of any Operative Agreement, (ii) the legality, validity, binding effect
or enforceability of any Operative Agreement or (iii) the acquisition,
ownership, construction or operation of the Facility, in each case,
except those which have been obtained;
(f) Upon the execution and delivery of the Lease Supplement to the
Lease, (i) the Lessee will have unconditionally accepted the Facility and
will have a valid and subsisting leasehold interest in the Facility,
subject only to the Permitted Exceptions, and (ii) no offset will exist
with respect to any Rent or other sums payable under the Lease;
(g) Except as otherwise contemplated by the Operative Agreements,
the Construction Agent shall not use the proceeds of any Funding for any
purpose other than the purchase of the Facility, the acquisition and
installation of the Equipment, the payment of the Transaction Expenses,
the construction of the Additions and the testing thereof and the
payment of interest on the Loans and Holder Yield on the Holder
Fundings, in each case which accrue prior to the Basic Term Commencement
Date.
(h) All information heretofore or contemporaneously herewith
furnished by either the Construction Agent or the Lessee or any of their
Subsidiaries to the Administrative Agent, the Owner Trustee, any Lender
or the Holder for purposes of or in connection with this Agreement and
the transactions contemplated hereby is, and all information hereafter
furnished by or on behalf of the Construction Agent, the Lessee or any
of their Subsidiaries to the Administrative Agent, the Owner Trustee,
any Lender or the Holder pursuant hereto or in connection herewith will
be, true and accurate in every material respect on the date as of which
such information is dated or certified, and such information, taken as
a whole, does not and will not omit to state any material fact
necessary to make such information, taken as a whole, not misleading.
7.4 Representations and Warranties of the Administrative Agent.
Effective as of the Initial Closing Date, the Administrative Agent represents
and warrants to each of the other parties hereto that:
(a) It is a national banking association duly organized and validly
existing under the laws of the United States of America and has the full
power and authority to enter into and perform its obligations under this
Agreement and each other Operative Agreement to which it is or will be a
party;
(b) This Agreement and each other Operative Agreement to which it is
a party have been, or when executed and delivered will be, duly authorized
by all necessary corporate action on the part of the Administrative Agent
and have been, or on such Closing Date will have been, duly executed and
delivered by the Administrative Agent and, assuming the due authorization,
execution and delivery hereof and thereof by the other parties hereto and
thereto, are, or upon execution and delivery thereof will be, legal, valid
and binding obligations of the Administrative Agent, enforceable against
it in accordance with their respective terms;
(c) The execution, delivery and performance by the Administrative
Agent of this Agreement and each other Operative Agreement to which it
is or will be a party do not, and will not contravene the articles of
association or by-laws or other charter documents of the Administrative
Agent, or any applicable Law of the State of Georgia or of the United
States of America governing its activities and will not contravene any
provision of, or constitute a default under any indenture, mortgage,
contract or other instrument of which it is a party or by which it or
its properties are bound, or require any consent or approval of any
Governmental Authority under any applicable law, rule or regulation of
the State of Georgia or any federal law, rule or regulation of the
United States of America governing its activities;
and
(d) Except as otherwise contemplated by the Operative Agreements,
the Administrative Agent shall not, nor shall it direct the Lessor to,
use the proceeds of any Loan for any purpose other than the purchase of
the Facility, the acquisition and installation of Equipment, the payment
of the Transaction Expenses, the construction of the Additions and
testing thereof and the payment of interest on the Loans during the
period prior to the Basic Term Commencement Date.
SECTION VIII REPRESENTATIONS AND WARRANTIES ON FUNDING DATES.
8.1 Representations and Warranties on the Facility Closing Date. The
Construction Agent and the Lessee hereby represent and warrant as of the
Facility Closing Date as follows (which representations and warranties shall
continue until satisfaction of all obligations of the Lessee and the
Construction Agent under the Operative Agreements):
(a) The representations and warranties of the Construction Agent and
the Lessee set forth in the Operative Agreements are true and correct in
all material respects on and as of the Facility Closing Date as if made
on and as of such date. The Construction Agent and the Lessee are in
all material respects in compliance with their respective obligations
under the Operative Agreements and there exists no Default or Event of
Default under any of the Operative Agreements which is continuing and
which has not been cured within any cure period expressly granted under
the terms of the applicable Operative Agreement. No Default or Event
of Default will occur under any of the Operative Agreements as a result
of, or after giving effect to, the Funding requested by the Requisition
on the Facility Closing Date;
(b) The Ground Lease for the Facility provides for ground lease
rental payments that are not in excess of fair market rental value, and
the Facility consists of, among other things a leasehold interest in the
land pursuant to the Ground Lease, located at the location set forth
on the applicable Requisition, all of which is in the Approved State;
(c) Upon the leasing of the Land on the Facility Closing Date, and
at all times thereafter, the Lessor will have a leasehold interest in the
Land enforceable against the Lessee, as ground lessor, in accordance with
the terms of the Ground Lease and upon the acquisition of the remainder
of the Facility, and at all times thereafter, the Lessor will have good
and marketable title to the remainder of the Facility, subject only, in
each case, to Permitted Liens;
(d) The execution and delivery of each Operative Agreement delivered
by the Construction Agent and/or the Lessee on the Facility Closing Date
and the performance of the obligations of the Construction Agent and the
Lessee under each Operative Agreement have been duly authorized by all
requisite corporate action of the Construction Agent or the Lessee, as
applicable;
(e) Each Operative Agreement delivered on the Facility Closing Date
by the Construction Agent and/or the Lessee has been duly executed and
delivered by the Construction Agent and/or the Lessee;
(f) Each Operative Agreement delivered by the Construction Agent
and/or the Lessee on such Facility Closing Date is a legal, valid and
binding obligation of the Construction Agent or the Lessee, as
applicable, enforceable against the Construction Agent or the Lessee,
as applicable, in accordance with its respective terms;
(g) Flood insurance has been obtained for the Facility in accordance
with Section 14.2(a) of the Lease;
(h) The Construction Agent has obtained insurance coverage for the
Facility which meets the requirements of the Lease and all of such coverage
is in full force and effect;
(i) The Facility complies with all Legal Requirements applicable as
of such date (including, without limitation, all zoning and land use laws
and Environmental Laws), except to the extent that failure to comply
therewith would not, individually or in the aggregate, have a Material
Adverse Effect;
(j) All utility services and facilities necessary for the
installation and operation of the Equipment and the construction and
operation of the Additions existing on, or to be constructed after, the
Facility Closing Date (including, without limitation, gas, electrical,
water and sewage services and facilities) are available at the
boundaries of the Land or will be constructed on the Land prior to the
Completion Date for the Facility;
(k) (i) The Security Documents create, as security for the
Obligations (as such term is defined in the Security Agreement), valid
and enforceable security interests in, and Liens on, all of the
Collateral, in favor of the Administrative Agent and the Holder, for
the ratable benefit of the Lenders, and the Holder, as their respective
interests appear in the Security Documents, and such security interests
and Liens are subject to no other Liens. To the extent that the Lien
on the portion of the Collateral comprised of real property can be
perfected by recordation in the real estate recording office in the
State of Louisiana identified by the Construction Agent or the Lessee,
upon recordation of the Mortgage Instrument in such real estate
recording office, the Lien created by the Mortgage Instrument shall be
a perfected first priority mortgage Lien on such real property in favor
of the Holder (for the benefit of itself and the Administrative Agent,
on behalf of the Lenders). To the extent that the security interests
in the portion of the Collateral comprised of personal property can be
perfected by filing in the filing offices in the States of Louisiana,
Georgia or elsewhere identified by the Construction Agent or the Lessee,
upon filing of the Lender Financing Statements in such filing offices,
the security interests created by the Security Agreement shall be
perfected first priority security interests in such personal property
in favor of the Administrative Agent, for the ratable benefit of the
Lenders, and the Holder, as their respective interests appear therein.
(ii) The Lease Agreement creates, as security for the
obligations of the Lessee under the Lease Agreement, valid and
enforceable security interests in, and Liens on, the Facility leased
thereunder, in favor of the Lessor, and such security interests and
Liens are subject to no other Liens. To the extent that the Lien on the
portion of the Facility comprised of real property can be perfected by
recordation in the real estate recording office in the State of
Louisiana identified by the Lessee, upon recordation of the memorandum
of the Lease Agreement and the memorandum of the Ground Lease in such
real estate recording office, the Lien created by the Lease Agreement
shall be a perfected first priority mortgage Lien on such real property
in favor of the Holder (for the benefit of itself and the Administrative
Agent, on behalf of the Lenders). To the extent that the security
interests in the portion of the Facility comprised of personal property
can be perfected by the filing in the filing offices in the States
of Louisiana, Georgia or elsewhere identified by the Construction Agent
or the Lessee upon filing of the Lessor Financing Statements in such
filing offices, a security interest created by the Lease Agreement shall
be perfected first priority security interests in such personal property
in favor of the Lessor, which rights pursuant to the Lessor Financing
Statements are assigned to the Administrative Agent, for the ratable
benefit of the Lenders, and the Holder, as their respective interests
appear therein;
(l) All necessary (or in the reasonable opinion of the
Administrative Agent, the Holder, the Lessor or any of their respective
counsel, advisable) Governmental Action, in each case required by any
Law enacted, imposed or adopted on or prior to the date thereof or by
any change in facts or circumstances on or prior to the date thereof,
shall have been obtained or made and be in full force and effect; and
(m) In the aggregate, the Facility and the personal property
(movable property) and real property (immovable property) subject to the
Ground Lease 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 cogeneration facility and related
facilities at the level of production required for Final Completion (as
such term is defined in the GE Construction Contract) and otherwise in
a commercially reasonable manner. Furthermore, the Facility and the
personal property (movable property) and real property (immovable
property) subject to the Ground Lease are capable of operating on an
independent, stand alone basis to the extent such are not operated in
connection with or as part of the Lessee's chemical production complex
located in or about Plaquemine, Louisiana.
8.2 Representations and Warranties Upon Initial Construction Fundings.
The Construction Agent and the Lessee hereby represent and warrant as of the
date on which the Initial Construction Funding is made as follows:
(a) The representations and warranties of the Construction Agent and
the Lessee set forth in the Operative Agreements are true and correct in
all material respects on and as of the date of the Initial Construction
Funding as if made on and as of such date. The Construction Agent and
the Lessee are in all material respects in compliance with their
respective obligations under the Operative Agreements and there exists
no Default or Event of Default under any of the Operative Agreements
which is continuing and which has not been cured within any cured period
expressly granted under the terms of the applicable Operative
Agreements. No Default or Event of Default will occur under any of the
Operative Agreements as a result of, or after giving effect to, the
Funding requested by the Requisition on such date;
(b) The Lessor has a leasehold interest in the Land enforceable
against the Lessee, as ground lessor, in accordance with the terms of
the Ground Lease and good and marketable title to the remainder of the
Facility, subject only, in each case, to Permitted Liens;
(c) All consents, licenses, permits, authorizations, assignments
and building permits required as of such date by all material Legal
Requirements or pursuant to the terms of any contract, indenture,
instrument or agreement for the acquisition, ownership, construction,
completion, occupancy, operation, leasing or subleasing of the Facility
have been obtained and are in full force and effect, except to the
extent that the failure to so obtain would not reasonably be expected
to, individually or in the aggregate, have a Material Adverse Effect;
(d) The Construction Agent has obtained insurance covering the
Facility which meets the requirements of Section 2.6 of the Agency
Agreement before commencing construction, repairs or modifications, as
the case may be, and such coverage is in full force and effect;
(e) The Facility, as constructed in accordance with the Plans and
Specifications, will comply as of the Completion Date with all material
Legal Requirements and Insurance Requirements (including, without
limitation, all zoning and land use laws and Environmental Laws),
except to the extent the failure to comply therewith would not,
individually or in the aggregate, have a Material Adverse Effect. The
Plans and Specifications have been or will be prepared in accordance
with all applicable Legal Requirements (including, without limitation,
all applicable Environmental Laws and building, planning, zoning and
fire codes), except to the extent the failure to comply therewith would
not, individually or in the aggregate, have a Material Adverse Effect,
and upon completion of the Facility in accordance with the Plans and
Specifications, the Facility will not encroach in any manner onto any
adjoining land (except as permitted by express written easements),
shall not be subject to any Lien except Permitted Liens, and the use of
the Facility by the Lessee and its agents, assignees, employees,
invitees, lessees, licensees and tenants will comply as of the
Completion Date in all respects with all applicable Legal Requirements
(including, without limitation, all applicable Environmental Laws and
building, planning, zoning and fire codes), except to the extent the
failure to comply therewith would not, individually or in the aggregate,
have a Material Adverse Effect. Upon installation of the Equipment and
completion of the Facility in accordance with the Plans and
Specifications, (i) there will be no material defects to the Facility
including, without limitation, the plumbing, heating, air conditioning
and electrical systems thereof and (ii) all water, sewer, electric, gas,
telephone and drainage facilities and all other utilities required to
adequately service the Facility for its intended use will be available
pursuant to adequate permits (including any that may be required under
applicable Environmental Laws), except to the extent that failure to
obtain any such permit would not, individually or in the aggregate, have
a Material Adverse Effect. There is no action, suit or proceeding
(including any proceeding in condemnation or eminent domain or under any
Environmental Law) pending or, to the best knowledge of the Lessee or
the Construction Agent, overtly threatened which adversely affects the
title to, or the use, operation or value of, the Facility. No fire or
other casualty with respect to the Facility has occurred which fire
or other casualty has had a Material Adverse Effect. All utilities
serving the Facility, or proposed to serve the Facility in accordance
with the Plans and Specifications, are located in (and in the future
will be located in) and vehicular access to the Additions is provided
by (or will be provided by), either public rights-of-way abutting the
Facility or Appurtenant Rights. All licenses, approvals,
authorizations, consents, permits (including, without limitation,
building, demolition and environmental permits, licenses, approvals,
authorizations and consents), easements and rights-of-way, including
proof of dedication, required for (i) the use, treatment, storage,
transport, disposal or disposition of any Hazardous Substance on, at,
under or from the Land underlying the Facility during the construction
of the Facility and the use and operation of the Facility following
such construction, (ii) the installation of the Equipment and
construction of the Facility in accordance with the Plans and
Specifications and the Agency Agreement and (iii) the use and operation
of the Facility after Completion, in each case have either been obtained
from the appropriate Governmental Authorities having jurisdiction or
from private parties, as the case may be, or will be obtained from the
appropriate Governmental Authorities having jurisdiction or from private
parties, as the case may be, prior to commencing any such installation
and construction or use and operation, as applicable; and
(f) All conditions precedent contained in this Agreement and in the
other Operative Agreements relating to the initial Funding to the
Construction Agent have been substantially satisfied.
8.3 Representations and Warranties Upon the Date of Each Construction
Funding that is not the Initial Funding. The Construction Agent and the
Lessee hereby represent and warrant as of each date on which a Construction
Funding is made, when such Funding is not the Initial Construction Funding,
as follows:
(a) The representations and warranties of the Construction Agent and
the Lessee set forth in the Operative Agreements (including the
representations and warranties set forth in Section 8.2) are true and
correct in all material respects on and as of the date of such
Construction Funding as if made on and as of such date. The
Construction Agent and the Lessee are in all material respects in
compliance with their respective obligations under the Operative
Agreements and there exists no Default or Event of Default under any of
the Operative Agreements which is continuing and which has not been
cured within any cure period expressly granted under the terms of the
applicable Operative Agreement. No Default or Event of Default will
occur under any of the Operative Agreements as a result of, or after
giving effect to, the Funding requested by the Requisition on such date;
(b) Acquisition and installation of the Equipment and the
construction of the Additions to date has been performed in a good and
workmanlike manner, substantially in accordance with the Plans and
Specifications and the Construction Contracts and in compliance with all
Insurance Requirements and material Legal Requirements, except to the
extent noncompliance with any Legal Requirements would not, individually
or in the aggregate, have a Material Adverse Effect;
(c) All consents, licenses, permits, authorizations, assignments and
building permits required as of the date on which such Funding is made by
all material Legal Requirements or pursuant to the terms of any contract,
indenture, instrument or agreement for the acquisition, ownership,
construction, completion, occupancy, operation, leasing or subleasing of
the Facility have been obtained and are in full force and effect except
to the extent the failure to so obtain would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect;
(d) When completed, the Equipment and the Additions shall be wholly
within any building restriction lines and otherwise in compliance with all
Insurance Requirements and material Legal Requirements (unless consented
to by applicable Government Authorities), however established; and
(e) The Funding is secured by the Liens of the Security Agreement
and such Mortgage Instruments, and there have been no Liens against the
Equipment or the Additions or any other portion of the Facility since
the filing of such UCC Financing Statements and such Mortgage
Instruments other than Permitted Liens.
The Construction Agent and the Lessee further acknowledge that upon the
acceptance and use of the funds by the Construction Agent or the Lessee, as
the case may be, on behalf of the Lessor that all such representations and
warranties remain true and correct on the date of such Funding and that all
consents and approvals have been obtained prior to the date of such Funding.
SECTION IX PAYMENT OF CERTAIN EXPENSES.
9.1 Transaction Expenses. (a) Lessor agrees on the Initial Closing Date,
to pay, or cause to be paid, all reasonable fees, expenses and disbursements of
the various legal counsels for the Lessor and the Administrative Agent in
connection with the transactions contemplated by the Operative Agreements and
incurred in connection with such Initial Closing Date, including all Transaction
Expenses (arising from the Initial Closing Date), and all other reasonable fees,
expenses and disbursements in connection with such Initial Closing Date,
including, without limitation, all fees, taxes and expenses for the
recording, registration and filing of documents; provided, however, the
Lessor shall pay such amounts described in this Section 9.1(a) only if (i)
such amounts are properly described in a Requisition delivered on or before
the Initial Closing Date, and (ii) funds are made available by the Lenders
and the Holder in connection with such Requisition in an amount sufficient
to allow such payment. On the Initial Closing Date after delivery and
receipt of the Requisition referenced in Section 4.2(a) hereof and
satisfaction of the other conditions precedent for such date, the Holder
shall make a Holder Funding and the Lenders shall make Loans to the Lessor to
pay for the Transaction Expenses, fees, expenses and other disbursements
referenced in this Section 9.1(a). The Lessee agrees to timely pay all
amounts referred to in this Section 9.1(a) to the extent not paid by Lessor.
(b) Assuming no Default or Event of Default shall have occurred and be
continuing and only for the period prior to the Basic Term Commencement Date,
Lessor agrees on the Facility Closing Date, on the date of any Construction
Funding and on the Completion Date to pay, or cause to be paid, all
Transaction Expenses including without limitation all reasonable fees, expenses
and disbursements of the various legal counsels for the Lessor and the
Administrative Agent in connection with the transactions contemplated by the
Operative Agreements and billed in connection with such Funding or such
Completion Date, all fees, expenses and disbursements incurred with respect
to the various items referenced in Sections 5.3, 5.4, 5.5 and/or 5.6
(including without limitation any premiums for title insurance policies and
charges for any updates to such policies) and all other reasonable fees,
expenses and disbursements in connection with such Funding or such Completion
Date including, without limitation, all expenses relating to and all fees,
taxes and expenses for the recording, registration and filing of documents
and during the Commitment Period, all fees, expenses and costs referenced in
Sections 9.3 (i) or (ii) and all fees referenced in Sections 9.3, 9.4 or 9.5;
provided, however, the Lessor shall pay such amounts described in this
Section 9.1(b) only if (i) such amounts are properly described in a
Requisition delivered on the applicable date and (ii) funds are made
available by the Lenders and the Holder in connection with such Requisition
in an amount sufficient to allow such payment. On the Facility Closing Date,
on the date of any Construction Funding or the Completion Date, after
delivery of the applicable Requisition and satisfaction of the other
conditions precedent for such date, the Holder shall make a Holder Funding
and the Lenders shall make Loans to the Lessor to pay for the Transaction
Expenses, fees, expenses and other disbursements referenced in this Section
9.1(b). The Lessee agrees to timely pay all amounts referred to in this
Section 9.1(b) to the extent not paid by the Lessor.
9.2 Brokers' Fees and Stamp Taxes. Lessee agrees to pay or cause to be
paid any brokers' fees and any and all stamp, transfer, general intangible and
other similar taxes, fees and excises, if any, including any interest and
penalties, which are payable in connection with the transactions contemplated
by this Agreement and the other Operative Agreements.
9.3 Certain Fees and Expenses. Lessee agrees to pay or cause to be paid
(i) the initial and annual Owner Trustee's fee and all reasonable expenses of
the Owner Trustee and any co-trustees (including without limitation
reasonable counsel fees and expenses) or any successor owner trustee, for
acting as owner trustee under the Trust Agreement, (ii) all reasonable costs
and expenses incurred by the Construction Agent, the Lessee, the
Administrative Agent, the Lenders, the Holder or the Lessor in entering into
the Lease Supplement and any future amendments or supplements with respect
to any of the Operative Agreements, whether or not the Lease Supplement,
amendments or supplements are ultimately entered into, or giving or
withholding of waivers of consents hereto or thereto, which have been
requested by the Lessor, the Holder, the Construction Agent, the Lessee, or
the Administrative Agent, (iii) all reasonable costs and expenses incurred by
the Lessor, the Holder, the Lenders or the Administrative Agent in connection
with any exercise of remedies under any Operative Agreement or any purchase
of the Facility by the Lessee pursuant to Article XX of the Lease and (iv)
all reasonable costs and expenses incurred by the Construction Agent, Lessee,
the Administrative Agent, the Lenders, the Holder or the Lessor in connection
with any transfer or conveyance of the Facility, whether or not such transfer
or conveyance is ultimately accomplished.
9.4 Unused Fee. During the Commitment Period, the Lessee agrees to pay
to the Administrative Agent for the account of (a) the Lenders, respectively,
an unused fee (the "Lender Unused Fee") computed at a rate per annum equal to
the Applicable Percentage for the Lender Unused Fee multiplied by the Available
Commitment of each Lender during the Commitment Period and (b) the Holder for
the account of the Holder an unused fee (the "Holder Unused Fee") computed at a
rate per annum equal to the Applicable Percentage (for the Holder) for the
Holder Unused Fee multiplied by the then current unfunded portion of the
Holder Commitment during the Commitment Period. Such Unused Fees shall be
calculated on the basis of 360-day year from the actual days elapsed and
shall be payable quarterly in arrears on each Unused Fee Payment Date. If
all or a portion of any such Unused Fee shall not be paid when due, such
overdue amount shall bear interest, payable by the Lessee on demand, at a
rate per annum equal to the ABR plus two percent (2%) from the date of such
non-payment until such amount is paid in full (as well as before judgment).
9.5 Participation Fee. On the Initial Closing Date, the Lessee agrees to
pay to the Administrative Agent for the account of (a) the Lenders,
respectively, a participation fee (the "Lender Participation Fee") equal to
the Commitment of such Lender multiplied by 0.001 and (b) the Holder a
participation fee (the "Holder Participation Fee") equal to the Holder
Commitment multiplied by 0.005. If all or a portion of any such
Participation Fee shall not be paid when due, such overdue amount shall bear
interest payable by Lessee on demand, at a rate per annum equal to the ABR
plus two percent (2%) from the date of such non-payment until such amount is
paid in full (after as well as before judgment).
SECTION X OTHER COVENANTS AND AGREEMENTS.
10.1 Cooperation with the Construction Agent or the Lessee. The Holder,
the Lessor (at the direction of the Holder) and the Administrative Agent
shall, to the extent reasonably requested by the Construction Agent or Lessee
(but without assuming additional liabilities on account thereof), at the
Construction Agent's or the Lessee's expense cooperate with the Construction
Agent or the Lessee in connection with its covenants contained herein
including, without limitation, at any time and from time to time, upon the
request of the Construction Agent or the Lessee to promptly and duly execute
and deliver any and all such further instruments, documents and financing
statements (and continuation statements related thereto) as the Construction
Agent or the Lessee may reasonably request in order to perform such covenants.
10.2 Covenants of the Owner Trustee and the Holder. Each of the Owner
Trustee and the Holder hereby agree that so long as this Agreement is in
effect:
(a) Each of the Holder and the Owner Trustee (both in its trust
capacity and in its individual capacity) will not create or permit to
exist at any time, and will, at its own cost and expense, promptly take
such action as may be necessary duly to discharge, or to cause to be
discharged, all Lessor Liens on the Facility attributable to it;
provided, however, that the Holder and the Owner Trustee shall not be
required to so discharge any such Lessor Lien while the same is being
contested in good faith by appropriate proceedings diligently
prosecuted so long as such proceedings shall not involve any material
danger of impairment of the Liens of the Security Documents or of the
sale, forfeiture or loss of, and shall not interfere with the use or
disposition of, the Facility or title thereto or any interest therein or
the payment of Rent;
(b) Without prejudice to any right under the Trust Agreement of the
Owner Trustee to resign (subject to requirement set forth in the Trust
Agreement that such resignation shall not be effective until a successor
shall have agreed to accept such appointment), or the Holder's rights
under the Trust Agreement to remove the institution acting as Owner
Trustee(after consent to such removal by the Administrative Agent as
provided in the Trust Agreement), each of the Holder and the Owner
Trustee hereby agrees with the Lessee and the Administrative Agent (i)
not to terminate or revoke the trust created by the Trust Agreement
except as permitted by Article VIII of the Trust Agreement, (ii) not to
amend, supplement, terminate or revoke or otherwise modify any provision
of the Trust Agreement in such a manner as to adversely affect the
rights of any such party without the prior written consent of such
party and (iii) to comply with all of the terms of the Trust Agreement,
the nonperformance of which would adversely affect such party;
(c) The Owner Trustee or any successor may resign or be removed by
the Holder as Owner Trustee, a successor Owner Trustee may be appointed
and a corporation may become the Owner Trustee under the Trust
Agreement, only in accordance with the provisions of Article IX of the
Trust Agreement and, with respect to such appointment, with the consent
of the Lessee, which consent shall not be unreasonably withheld or
delayed;
(d) The Owner Trustee, in its capacity as Owner Trustee under the
Trust Agreement, and not in its individual capacity, shall not contract
for, create, incur or assume any Indebtedness, or enter into any
business or other activity, other than pursuant to or under the
Operative Agreements (including without limitation Section 14.16 hereof);
(e) The Holder will not instruct the Owner Trustee to take any
action in violation of the terms of any Operative Agreement;
(f) Neither the Holder nor the Owner Trustee shall (i) commence any
case, proceeding or other action with respect to the Owner Trustee under
any existing or future law of any jurisdiction, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, arrangement,
winding-up, liquidation, dissolution, composition or other relief with
respect to it or its debts, or (ii) seek appointment of a receiver,
trustee, custodian or other similar official with respect to the Owner
Trustee or for all or any substantial benefit of the creditors of the
Owner Trustee; and neither the Holder nor the Owner Trustee shall take
any action in furtherance of, or indicating its consent to, approval of,
or acquiescence in, any of the acts set forth in this paragraph;
(g) The Owner Trustee shall give prompt notice to the Lessee, the
Holder and the Administrative Agent if the Owner Trustee's chief place
of business or chief executive office, or the office where the records
concerning the accounts or contract rights relating to the Facility are
kept, shall cease to be located at 79 South Main Street, Salt Lake City,
Utah 84111, or if it shall change its name;
(h) Provided that no Lease Default or Lease Event of Default has
occurred and is continuing, neither the Owner Trustee nor the Holder
shall, without the prior written consent of the Lessee, consent to or
permit any amendment, supplement or other modification of the terms and
provisions of the Credit Agreement or the Notes;
(i) Neither the Owner Trustee nor the Holder shall consent to or
permit any amendment, supplement or other modification of the terms and
provisions of any Operative Agreement, in each case without the prior
written consent of the Administrative Agent, subject to the approval of
the Majority Lenders, except as described in Section 10.5 of this
Agreement; and
(j) The Owner Trustee (i) shall take such actions and shall refrain
from taking such actions with respect to the Operative Agreements
(excluding any matter relating to the Facility) and shall grant such
approvals and otherwise act or refrain from acting with respect to the
Operative Agreements (excluding any matter relating to the Facility) in
each case as directed in writing by the Administrative Agent or, in
connection with Sections 10.5 or 10.8 hereof, the Lessee,
notwithstanding any contrary instruction or absence of instruction by
the Holder; and (ii) shall not take any action, grant any approvals or
otherwise act under or with respect to the Operative Agreements
(excluding any matter relating to the Facility) without first obtaining
the prior written consent of the Administrative Agent (and without
regard to any contrary instruction or absence of instruction by the
Holder); provided, however, that notwithstanding the foregoing
provisions of this subparagraph (j) the Owner Trustee, the
Administrative Agent and the Holder each acknowledge, covenant and
agree that, with respect to all matters under the Operative Agreements
that require the consent and/or concurrence of all of the Lenders
pursuant to the terms of Section 9.1 of the Credit Agreement (the
"Unanimous Vote Matters"), neither the Owner Trustee nor the
Administrative Agent shall act or refrain from acting with respect to
any Unanimous Vote Matter until such party has received the approval of
each Lender and the Holder with respect thereto. The Owner Trustee
(x) shall take such actions and shall refrain from taking such actions
with respect to the Facility and shall grant such approvals and
otherwise act or refrain from acting with respect to the Facility in
each case as directed in writing by the Holder or, in connection with
Sections 10.5 or 10.8 hereof, the Lessee, notwithstanding any contrary
instruction or absence of instruction by the Administrative Agent or
any Lender; and (y) shall not take any action, grant any approvals or
otherwise act under any Operative Agreement or with respect to the
Facility without first obtaining the prior written consent of the Holder
(and without regard to any contrary instruction or absence of
instruction by the Administrative Agent or any Lender).
10.3 Lessee Covenants, Consent and Acknowledgment.
(a) Lessee acknowledges and agrees that the Owner Trustee, pursuant
to the terms and conditions of the Security Agreement and the Mortgage
Instruments, shall create Liens respecting the various personal
property, fixtures and real property described therein in favor of the
Administrative Agent and the Holder. Lessee hereby irrevocably consents
to the creation, perfection and maintenance of such Liens. Each of the
Construction Agent and Lessee shall, to the extent reasonably requested
by any of the other parties hereto, cooperate with the other parties in
connection with their covenants herein or in the other Operative
Agreements and shall from time to time duly execute and deliver any and
all such future instruments, documents and financing statements (and
continuation statements related thereto) as any other party hereto may
reasonably request.
(b) Lessor hereby instructs Lessee, and Lessee hereby acknowledges
and agrees, that until such time as the Loans are paid in full and the
Liens evidenced by the Security Agreement and the Mortgage Instruments
have been released (i) any and all Rent and any and all other amounts of
any kind or type under any of the Operative Agreements due and owing or
payable to the Lessor or the Owner Trustee shall instead be paid directly
to the Administrative Agent or as the Administrative Agent may direct
from time to time for allocation and distribution in accordance with the
procedures set forth in Section 10.7 hereof and (ii) Lessee shall cause
all notices, certificates, financial statements, communications and
other information delivered, or required to be delivered, to the Lessor,
to also to be delivered at the same time to the Administrative Agent and
the Holder.
(c) The Lessee shall not consent to or permit any amendment,
supplement or other modification of the terms or provisions of any
Operative Agreement without, in each case, obtaining the prior written
consent of the Administrative Agent and/or, to the extent required by
Section 10.2(j) hereof, the Holder. The Lessee acknowledges that the
actions of the Owner Trustee are subject to the consent of the
Administrative Agent and the Holder as set forth in Section 10.2(j).
(d) The Lessee hereby covenants and agrees to cause an Appraisal (in
form and substance reasonably satisfactory to the Administrative Agent and
the Lessor and from an appraiser selected by Administrative Agent and the
Holder) to be issued respecting the Facility as requested by the
Administrative Agent and/or the Holder from time to time but no more
frequently than every three (3) years; provided, notwithstanding the
foregoing, the Lessee agrees to cause such Appraisals to be issued as
requested by the Administrative Agent and/or the Holder from time to
time (i) at each and every time as such shall be required to satisfy any
regulatory requirements imposed on the Administrative Agent, the Lenders
and/or the Holder and (ii) after the occurrence of an Event of Default.
(e) The Lessee hereby covenants and agrees that, except for amounts
payable as Basic Rent and as otherwise expressly specified in the
Operative Agreements, any and all payment obligations owing from time
to time under the Operative Agreements to the Administrative Agent, any
Lender or the Holder shall (without further action) be deemed to be (i)
obligations payable by the Construction Agent prior to the commencement
of the Basic Term and (ii) Supplemental Rent obligations payable by the
Lessee after the commencement of the Basic Term. Without limitation,
such obligations shall include arrangement fees, administration fees,
participation fees, commitment fees, unused fees, breakage costs,
indemnities, trustee fees and transaction expenses incurred by the
parties hereto in connection with the transactions contemplated by the
Operative Agreements.
(f) At any time the Lessor or the Holder is entitled under the
Operative Agreements to possession of the Facility or any component
thereof, each of the Construction Agent and the Lessee hereby covenants
and agrees, at its own cost and expense, to assemble and make available
to the Holder (or its designee) any and all personal property components
of the Facility.
(g) On or prior to April 1, 1996, the Construction Agent shall
deliver to the Administrative Agent, the Holder and the Lessor a Phase I
environmental site assessment respecting the Facility prepared by an
independent recognized professional acceptable to the Administrative
Agent, the Holder and the Lessor and in form and substance satisfactory
to the Administrative Agent, the Holder and the Lessor. To the extent
such site assessment identifies or references any Hazardous Substance or
Environmental Violation at the Facility, the Construction Agent shall,
on or prior to June 1, 1996, cause such matter to be appropriately
remediated and a certification from an independent recognized
professional acceptable to the Administrative Agent, the Holder and the
Lessor regarding such completed remediation to be delivered to the
Administrative Agent, the Holder and the Lessor. To the extent such
site assessment is not delivered by April 1, 1996 or any such
remediation is not completed by June 1, 1996, the Administrative Agent
(in accordance with the instructions of the Majority Lenders) shall
determine within 90 days of either such missed deadline if the Facility
shall be conveyed to the Lessee. The Lessor and the Lessee shall act in
accordance with such determination by the Administrative Agent, and any
such conveyance of the Facility by the Lessor to the Lessee shall be
pursuant to the terms of the provisions of Section 22.1(c) of the Lease,
without regard to whether the Basic Term Commencement Date as occurred
at such time.
(h) The Lessee may add one or more Approved Turbines to the Facility
upon the satisfaction (but not prior thereto) of the following terms and
conditions respecting each such Approved Turbine prior to the date of
installation thereof at the Facility:
(i) the Lessee shall (A) deliver to the Administrative Agent,
each Lender and the Holder fully executed copies of all documents
relating to the operation or financing of such proposed Approved
Turbine and all other information regarding such proposed Approved
Turbine, as reasonably requested by any such party, and (B) obtain
the prior written consent of the Administrative Agent, each Lender
and the Holder regarding the addition of such proposed Approved
Turbine;
(ii) the Lessee shall demonstrate to the reasonable satisfaction
of the Administrative Agent, each Lender and the Holder that (A) such
proposed Approved Turbine shall have no adverse impact on the rights
of such parties under the Operative Agreements or otherwise with
regard to the financing transactions contemplated thereby, (B) the
Liens pursuant to the Security Documents shall not be negatively
impacted by financing arrangements concerning such proposed
Approved Turbine and (C) such proposed Approved Turbine may be
installed at, and detached and removed from, the Facility without
causing damage thereto; and
(iii) the Lessee shall cause General Electric (or such other
independent, certified professional acceptable to the Administrative
Agent, each Lender and the Holder) to certify to the Administrative
Agent, each Lender and the Holder that the addition and use of such
proposed Approved Turbine shall not adversely affect the operation,
value, utility or useful life of the Facility.
10.4 Sharing of Certain Payments. Except for Holder Excepted Payments,
the parties hereto acknowledge and agree that all payments due and owing by
the Lessee to the Lessor under the Lease or any of the other Operative
Agreements shall be made by the Lessee directly to the Administrative Agent
as more particularly provided in Section 10.3 hereof. The Holder, the
Administrative Agent, the Lenders and the Lessee, acknowledge the terms of
Section 10.7 of the Participation Agreement regarding the allocation of
payments and other amounts made or received from time to time under the
Operative Agreements and agree, that all such payments and amounts are to be
allocated as provided in Section 10.7 of the Participation Agreement.
10.5 Grant of Easements, etc. The Administrative Agent and the Holder
hereby agree that, so long as no Event of Default shall have occurred and be
continuing, and until such time as the Holder gives instructions to the
contrary to the Owner Trustee, the Owner Trustee shall, from time to time at
the request of the Lessee, in connection with the transactions contemplated
by the Agency Agreement, the Lease or the other Operative Agreements, (i)
consent to any easements and other rights in the nature of easements with
respect to the Facility, (ii) consent to the release of existing easements or
other rights in the nature of easements which are for the benefit of the
Facility, (iii) execute and deliver to any Person any instrument appropriate
to confirm or effect such consents or releases, and (iv) execute and deliver
to any Person such other documents or materials in connection with the
acquisition, development, construction, testing or operation of the Facility,
including, without limitation, reciprocal easement agreements, construction
contracts, operating agreements, development agreements, plats, replats or
subdivision documents; provided, that each of the agreements referred to in
this Section 10.5 shall be of the type normally executed by the Lessee in the
ordinary course of the Lessee's business and shall be on commercially
reasonable terms so as not to diminish the value of the Facility in any
material respect.
10.6 Appointment by the Administrative Agent, the Lenders, the Holder and
the Owner Trustee. With regard to any interest in the Facility (including
without limitation contract rights, permits, intellectual property, manuals
and all other materials and items necessary or appropriate for the operation,
use and maintenance of the Facility), the Administrative Agent and the Lenders
hereby designate and appoint the Holder as their administrative agent under
this Agreement and the other Operative Agreements to take such actions,
exercise powers and perform duties in connection with the Holder Collateral
(in good faith and in accordance with all the other Operative Agreements) on
behalf of the Administrative Agent and/or the Lenders under this Agreement
and the other Operative Agreements.
Neither the Holder nor any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates shall be (a) liable for any action lawfully
taken or omitted to be taken by it or such Person under or in connection with
this Agreement or any other Operative Agreement (except for its or such
Person's own gross negligence or willful misconduct) or (b) responsible in
any manner to the Administrative Agent or any of the Lenders for any
recitals, statements, representations or warranties made by the Owner Trustee
or the Lessee or any officer thereof contained in this Agreement or any other
Operative Agreement or in any certificate, report, statement or other
document referred to or provided for in, or received by the Holder under or
in connection with, this Agreement or any other Operative Agreement or for
the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Operative Agreement or for any
failure of the Owner Trustee or the Lessee to perform its obligations
hereunder or thereunder. The Holder shall not be under any obligation to the
Administrative Agent or any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Operative Agreement, or to inspect
the properties, books or records of the Owner Trustee or the Lessee.
The Lenders agree to indemnify the Holder, in its capacity as agent for
the Administrative Agent and the Lenders (to the extent not reimbursed by the
Owner Trustee and without limiting the obligation of the Owner Trustee to do
so), ratably according to their respective Commitment Percentages in effect
on the date on which indemnification is sought under this Section 10.6 (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably in accordance
with their Commitment Percentages immediately prior to such date), from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
whatsoever which may at any time (including, without limitation, at any time
following the payment of the Notes) be imposed on, incurred by or asserted
against any of them in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Operative Agreements or any
documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted by
any of them under or in connection with any of the foregoing; provided that
no Lender shall be liable for the payment or any portion of such liabilities,
obligations, damages, penalties, actions, judgments, suits, costs, expenses
or disbursements resulting solely from the gross negligence or willful
misconduct of the Holder. The agreements in this Section 10.6 shall survive
the payment of the Notes and all other amounts payable hereunder.
Other than the exercise of reasonable care to assure the safe custody of
the Holder Collateral while being held by the Holder hereunder and under the
other Operative Agreements, the Holder shall have no duty or liability to
preserve rights pertaining thereto, it being understood and agreed that the
Lessee shall be responsible for preservation of all rights in the Holder
Collateral, and the Holder shall be relieved of all responsibility for the
Holder Collateral upon surrendering it or tendering the surrender of it to
the Lessee. The Holder shall be deemed to have exercised reasonable care in
the custody and preservation of the Holder Collateral in its possession if
the Holder Collateral is accorded treatment substantially equal to that
which the Holder accords its own property, which shall be no less than the
treatment employed by a reasonable and prudent agent in the industry, it
being understood that the Holder shall not have responsibility for taking
any necessary steps to preserve rights against any parties with respect to
any of the Holder Collateral.
With regard to any interest in the Lease (excluding any interest in the
Facility (including without limitation those items referenced in the
parenthetical phrase of the first sentence of this Section 10.6)), and the
application of proceeds regarding the Lender Collateral, the Holder hereby
designates and appoints the Administrative Agent as the administrative agent
of the Holder under this Agreement and the other Operative Agreements, to
take such actions, exercise powers and perform duties in connection with the
Lender Collateral on behalf of the Holder under the provisions of this
Agreement and the other Operative Agreements (in good faith and in accordance
with the other Operative Agreements). For purposes hereof, and except as
expressly provided herein to the contrary and except with regard to any
interest in the Facility (including without limitation those items referenced
in the parenthetical phrase of the first sentence of this Section 10.6), the
provisions of Section 7 of the Credit Agreement, together with such other
terms and provisions of the Credit Agreement and the other Operative
Agreements as required for the full interpretation and operation of Section 7
of the Credit Agreement are hereby incorporated by reference as if restated
herein for the mutual benefit of the Administrative Agent and the Holder as
if the Holder were a Lender thereunder. Except as may be expressly provided
to the contrary, for purposes hereof, outstanding Holder Fundings shall be
taken into account and treated as Loans for purposes of determining Majority
Lenders; provided, however, in any case, under the Operative Agreements
where the consent of the Holder is expressly required or the Holder is
entitled to take any action, such consent shall be given or action taken,
whether directly by the Holder or by the Administrative Agent (without the
requirement that the consent of any Lender be obtained or permission for such
action be granted by any Lender); and, provided, further, no amendment to any
provision expressly requiring the consent of the Holder or permitting the
Holder to take action (whether directly or through the Administrative Agent),
shall be effective without the written consent of the Holder. Further, the
Administrative Agent shall be entitled to take such action on behalf of the
Owner Trustee as is delegated to the Administrative Agent under any Operative
Agreement (whether express or implied) as may be reasonably incidental
thereto. Each Lender and the Holder hereby agree to the provisions contained
in this Section 10.6.
10.7 Collection and Allocation of Payments and Other Amounts. (a) The
Lessee and the Construction Agent have agreed pursuant to the terms of this
Participation Agreement to pay to the Administrative Agent any and all Rent
(excluding Holder Excepted Amounts) and any and all other amounts of any kind
or type owing by the Lessee or the Construction Agent to the Lessor or the
Owner Trustee under the Lease or any of the other Operative Agreements.
Promptly after receipt, the Administrative Agent shall apply and allocate, in
accordance with the terms of this Section 10.7, such amounts received by the
Lessee or the Construction Agent and all other payments, receipts and other
consideration of any kind whatsoever received by the Administrative Agent
pursuant to the Security Agreement or otherwise received by the
Administrative Agent, the Holder or any of the Lenders in connection with the
Collateral, the Security Documents or any of the other Operative Agreements.
(b) Payments and other amounts received by the Administrative Agent
from time to time in accordance with the terms of subparagraph (a) shall be
applied and allocated as follows:
(i) Any such payment or amount identified as or deemed to be
Basic Rent shall be applied and allocated by the Administrative Agent
first, ratably to the Lenders and the Holder for application and
allocation to the payment of interest on the Loans and thereafter the
principal of the Loans which is due and payable on such date and to the
payment of accrued Holder Yield with respect to the Holder Facility Cost
and thereafter the portion of the Holder Funding which is to be returned
on such date; and second, if no Default or Event of Default is in
effect, any excess shall be paid to such Person or Persons as the Lessee
may designate; provided, that if a Default or Event of Default is in
effect, such excess (if any) shall instead be held by the
Administrative Agent until the earlier of (I) the first date thereafter
on which no Default or Event of Default shall be in effect (in which
case such payments or returns shall then be made to such other Person or
Persons) and (II) the Maturity Date or the Expiration Date, as the case
may be (or, if earlier, the date of any Acceleration), in which case
such amounts shall be applied and allocated in the manner contemplated
by Section 10.7(b)(iv). The Administrative Agent shall distribute to
(x) the Lenders, ratably based on their respective Commitments, all
proceeds of Interest Payment Loans which shall be applied and allocated
to the interest on the Loans due and payable prior to the Basic Term
Commencement Date and (y) the Holder, based on the Holder Commitment,
all proceeds of Holder Fundings made with respect to the aggregate
amount of Holder Yield on the Holder Fundings prior to the Basic Term
Commencement Date.
(ii) If on any date the Administrative Agent or the Lessor shall
receive any amount in respect of (A) any Casualty or Condemnation pursuant
to Section 15.1(a) or 15.1(g) of the Lease (excluding any payments in
respect thereof which are payable to Lessee in accordance with the
Lease), or (B) the Termination Value in connection with the delivery of
a Termination Notice pursuant to Article XVI of the Lease, or (C) the
Termination Value in connection with the exercise of the Purchase Option
under Section 20.1 of the Lease or the exercise of the option of the
Lessor to transfer the Facility to the Lessee pursuant to Section 20.3
of the Lease, or (D) any payment required to be made or elected to be
made by the Construction Agent to the Lessor pursuant to the terms of
the Agency Agreement, then in each case, the Borrower shall be required
(1) if no Acceleration has occurred, to prepay the principal balance of
the Loans and apply and allocate to the Holder Funding, on a pro rata
basis, a portion of such amount to be distributed to the Lenders and the
Holder, such amount computed (x) in the case of the Loans, based on the
ratio of the Loans to the aggregate Facility Cost and (y) in the case of
the Holder Funding, based on the ratio of the Holder Funding to the
aggregate Facility Cost or (2) if an Acceleration has occurred, to apply
and allocate the proceeds respecting Sections 10.7(b)(ii)(A) and
10.7(b)(ii)(D) in accordance with Section 10.7(b)(iii) hereof and to
apply and allocate the proceeds respecting Sections 10.7(b)(ii)(B)
and 10.7(b)(ii)(C) in accordance with Section 10.7(b)(iv) hereof.
(iii) An amount equal to any payment identified as proceeds of
the sale (or lease upon the exercise of remedies) of the Facility or any
portion thereof, whether pursuant to Article XXII of the Lease, the
Contract Collateral Assignment, the Letter of Credit or pursuant to the
exercise of remedies under the Security Documents or otherwise, the
execution of remedies set forth in Section 17.6 of the Lease and any
payment in respect of excess wear and tear pursuant to Section 22.3 of
the Lease (whether such payment relates to a period before or after the
Construction Period Termination Date) shall be applied and allocated by
the Administrative Agent first, to the return to the Holder of an amount
not to exceed the outstanding Holder Fundings plus all outstanding
Holder Yield with respect to such outstanding Holder Fundings, second,
to the extent such amount exceeds the maximum amount to be returned
pursuant to the foregoing provisions of this paragraph (iii), ratably to
the payment of the principal and interest of the Loans then outstanding
plus any and all other amounts owing to the Administrative Agent and the
Lenders hereunder or under any of the other Operative Agreements, and
third, to the extent moneys remain after application and allocation
pursuant to clauses first through second above, to the Owner Trustee for
application and allocation to any and all other amounts owing to the
Holder or the Owner Trustee and as the Owner Trustee and the Holder
shall determine; provided, where no Event of Default shall exist and be
continuing and a prepayment is made for any reason with respect to less
than the full amount of the outstanding principal amount of the Loans
and the outstanding Holder Fundings, the proceeds shall be applied and
allocated ratably to the Lenders and to the Holder based on the ratio of
the outstanding principal balance of the Loans and the outstanding
Holder Fundings to the aggregate of such outstanding amounts of the
Loans and the Holder Fundings.
(iv) An amount equal to (A) any such payment identified as a
payment pursuant to Section 22.1(b) of the Lease (or otherwise) of the
Maximum Residual Guarantee Amount (and (B) any such lesser amount as may
be required by Section 22.1(b) of the Lease) in respect of the Facility
and (B) any other amount payable upon any exercise of remedies after the
occurrence of an Event of Default not covered by Section 10.7(b)(i) or
(iii) above (including any amount received in connection with an
Acceleration which does not represent proceeds from the sale or
liquidation of the Facility), shall be applied and allocated by the
Administrative Agent first, ratably, to the payment of the principal and
interest balance of the Loans then outstanding, second to the payment of
any other amounts owing to the Administrative Agent or the Lenders
hereunder or under any of the other Operative Agreement, and third, to
the extent moneys remain after application and allocation pursuant to
clauses first through second above, to the Owner Trustee for application
and allocation to Holder Fundings and Holder Yield and any other amounts
owing to the Holder or the Owner Trustee as the Owner Trustee and the
Holder shall determine.
(v) An amount equal to any such payment identified as
Supplemental Rent shall be applied and allocated by the Administrative
Agent to the payment of any amounts then owing to the Administrative
Agent, the Lenders, the Holder and the other parties to the Operative
Agreements (or any of them) (other than any such amounts payable
pursuant to the preceding provisions of this Section 10.7(b)) as shall
be determined by the Administrative Agent in its reasonable discretion;
provided, however, that Supplemental Rent received upon the exercise of
remedies after the occurrence and continuance of an Event of Default in
lieu of or in substitution of the Maximum Residual Guarantee Amount or
as a partial payment thereon shall be applied and allocated as set forth
in Section 10.7(b)(iv).
(vi) The Administrative Agent in its reasonable judgment shall
identify the nature of each payment or amount received by the
Administrative Agent and apply and allocate each such amount in the
manner specified above.
(c) Upon the termination of the Commitments and the payment in full
of the Loans and all other amounts owing by the Owner Trustee hereunder or
under any other Credit Document and the return in full of all amounts owing
to the Holder and the Owner Trustee under the Trust Agreement, any moneys
remaining with the Administrative Agent shall be returned to the Owner
Trustee or such other Person or Persons as the Owner Trustee may designate.
In the event of an Acceleration it is agreed that, prior to the application
and allocation of amounts received by the Administrative Agent in the order
described in Section 10.7(b) above, any such amounts shall first be applied
and allocated to the payment or return of (i) any and all sums advanced or
funded, as the case may be, by the Administrative Agent or the Holder in
order to preserve the Collateral or preserve its security interest therein,
(ii) the expenses of retaking, holding, preparing for sale or lease, selling
or otherwise disposing or realizing on the Collateral, or of any exercise by
the Administrative Agent or the Holder of its rights under the Security
Documents, together with reasonable attorneys' fees and court costs and (iii)
any and all other amounts reasonably owed to the Administrative Agent under or
in connection with the transactions contemplated by the Operative Agreements
(including without limitation any accrued and unpaid administration fees).
10.8 Relative Rights of the Lenders and the Holder. Upon the occurrence
and during the continuation of any Default or Event of Default and with respect
to the Facility, the remainder of the Holder Collateral and each of the
Security Documents to the extent relating to the Holder Collateral or the
rights and benefits of the Holder, the Holder in its sole discretion shall
make any and all elections and/or decisions and shall take such actions as
the Holder deems necessary or appropriate including without limitation with
regard to foreclosure, repossession, disposition and all other matters
relating to the Facility and/or the remainder of the Holder Collateral.
Upon the occurrence and during the continuation of any Default or Event of
Default and with respect to the Lease, the remainder of the Lender Collateral
and each of the Security Documents to the extent relating to the Lender
Collateral or the rights and benefits of the Lenders (excluding the Holder),
the Administrative Agent (in accordance with the instructions of the Majority
Lenders) shall make any and all elections and/or decisions and shall take
such actions as the Administrative Agent (in accordance with the instructions
of the Majority Lenders) deems necessary or appropriate including without
limitation with regard to foreclosure and all other matters relating to the
Lease and/or the remainder of the Lender Collateral. For purposes of this
paragraph and determining "Majority Lenders", the Holder shall not be deemed
a Lender and the Holder Fundings shall not be deemed Loans.
Upon the occurrence and during the continuation of both an Agency
Agreement Event of Default and a Lease Event of Default, the Administrative
Agent (in accordance with the instructions of the Majority Lenders) shall
determine whether to cause the Lessor to exercise remedies under (a) the
Agency Agreement respecting the Agency Agreement Event of Default or (b) the
Lease Agreement respecting the Lease Event of Default. For purposes of this
paragraph and determining "Majority Lenders", the Holder shall be deemed a
Lender and the Holder Fundings shall be deemed Loans.
SECTION XI CREDIT AGREEMENT AND TRUST AGREEMENT.
11.1 Construction Agent's and Lessee's Credit Agreement Rights.
Notwithstanding anything to the contrary contained in the Credit Agreement,
the Administrative Agent, the Lenders, the Holder, the Construction Agent,
the Lessee and the Owner Trustee hereby agree that, prior to the occurrence
and continuation of any Default or Event of Default, the Construction Agent
or the Lessee, as the case may be, shall have the following rights:
(a) the right to give the notice referred to in Section 2.3 of the
Credit Agreement, to designate the account to which a borrowing under the
Credit Agreement is to be credited pursuant to Section 2.3 of the Credit
Agreement;
(b) the right to terminate or reduce the Commitments pursuant to
Section 2.5(a) of the Credit Agreement;
(c) the right to exercise the conversion and continuation options
pursuant to Section 2.7 of the Credit Agreement;
(d) the right to receive any certificate issued pursuant to Section
2.11(a) of the Credit Agreement;
(e) the right to receive any certificate issued pursuant to Section
2.11(b) of the Credit Agreement;
(f) the right to receive any payment from a Lender pursuant to
Section 2.13(c) of the Credit Agreement;
(g) the right to receive any notice and any certificate, in each
case issued pursuant to Section 2.14(a) of the Credit Agreement;
(h) the right to replace any Lender pursuant to Section 2.14(b) of
the Credit Agreement;
(i) the right to approve any successor agent pursuant to Section 7.9
of the Credit Agreement;
(j) the right to consent to any assignment by a Lender to which the
Lessor has the right to consent pursuant to Section 9.8 of the Credit
Agreement;
(k) the right to consent to any replacement Lender to which the
Lessor has the right to consent pursuant to Section 9.20 of the Credit
Agreement; and
(l) without limiting the foregoing clauses (a) through (g), and in
addition thereto, provided that no Event of Default then exists, the
Construction Agent or the Lessee, as the case may be, shall have the
right to exercise any other right of the Owner Trustee under the Credit
Agreement upon not less than five (5) Business Days' prior written
notice from the Construction Agent or the Lessee, as the case may be, to
the Owner Trustee and the Administrative Agent.
11.2 Construction Agent's and Lessee's Trust Agreement Rights.
Notwithstanding anything to the contrary contained in the Trust Agreement,
the Construction Agent, the Lessee, the Owner Trustee and the Holder hereby
agree that, prior to the occurrence and continuation of any Default or Event
of Default, the Construction Agent or the Lessee, as the case may be, shall
have the following rights:
(a) the right to exercise the conversion and continuation options
pursuant to Section 3.8 of the Trust Agreement;
(b) no removal of the Owner Trustee and appointment of a successor
Owner Trustee pursuant to Section 9.1 of the Trust Agreement shall be
made without the prior written consent (not to be unreasonably withheld
or delayed) of the Construction Agent or the Lessee, as the case may be;
and
(c) the Holder and the Owner Trustee shall not amend, supplement or
otherwise modify any provision of the Trust Agreement in such a manner as
to adversely affect the rights of the Construction Agent or the Lessee,
as the case may be.
SECTION XII TRANSFER OF INTEREST.
12.1 Restrictions on Transfer. Each Lender may assign or transfer all or
a portion of its interest hereunder and under the other Operative Agreements in
accordance with Section 9.8 of the Credit Agreement. The Holder may, directly
or indirectly, assign, convey or otherwise transfer any of its right, title or
interest in or to the Trust Estate or the Trust Agreement in its sole
discretion. The Owner Trustee may, subject to the Lien of the applicable
Security Documents but only with the prior written consent of the
Administrative Agent, the Holder (which consents may be withheld by the
Administrative Agent and/or the Holder in their sole discretion) and
(provided no Event of Default has occurred and is continuing) with the
consent of the Lessee, directly or indirectly, assign, convey, appoint an
agent with respect to enforcement of, or otherwise transfer any of its right,
title or interest in or to the Facility, the Lease, the Trust Agreement, this
Agreement (including, without limitation, any right to indemnification
thereunder), or any other document relating to the Facility or any interest
in the Facility as provided in the Trust Agreement and the Lease. The
provisions of the immediately preceding sentence shall not apply to the
obligations of the Owner Trustee to transfer the Facility to the Lessee or a
third party purchaser pursuant to Article XXII of the Lease upon payment for
the Facility in accordance with the terms and conditions of the Lease.
12.2 Effect of Transfer. From and after any transfer effected in
accordance with this Section 12, the transferor shall be released, to the
extent of such transfer, from its liability hereunder and under the other
documents to which it is a party in respect of obligations to be performed on
or after the date of such transfer; provided, however, that any transferor
Holder shall remain liable under Article XI of the Trust Agreement to the
extent that the transferee Holder shall not have assumed the obligations of
the transferor Holder thereunder. Upon any transfer by the Owner Trustee, the
Lessor, the Holder or a Lender as above provided, any such transferee shall
assume the obligations of the Owner Trustee, the Lessor, the Holder or the
Lender, as the case may be, and shall be deemed an "Owner Trustee", "Lessor",
"Holder", or "Lender", as the case may be, for all purposes of such documents
and each reference herein to the transferor shall thereafter be deemed a
reference to such transferee for all purposes, except as provided in the
preceding sentence. Notwithstanding any transfer of all or a portion of the
transferor's interest as provided in this Section 12, the transferor shall be
entitled to all benefits accrued and all rights vested prior to such transfer
including, without limitation, rights to indemnification under any such
document.
SECTION XIII INDEMNIFICATION.
13.1 General Indemnity. Whether or not any of the transactions
contemplated hereby shall be consummated, the Indemnity Provider hereby
assumes liability for and agrees to defend, indemnify and hold harmless each
Indemnified Person on an After Tax Basis from and against any Claims, which
may be imposed on, incurred by or asserted against an Indemnified Person (by
any third party, including Claims arising from the negligence of an
Indemnified Person (but not to the extent such Claims arise from the gross
negligence, willful misconduct or willful breach of such Indemnified Person
or are otherwise solely attributable to acts or events occurring after the
expiration of the Lease or after the transfer of the Facility to the Lessee
or a third party)) in any way relating to or arising or alleged to arise out
of the execution, delivery, performance or enforcement of this Agreement, the
Lease or any other Operative Agreement or on or with respect to the Facility
or any component thereof, including, without limitation, Claims in any way
relating to or arising or alleged to arise out of (a) the financing,
refinancing, purchase, acceptance, rejection, ownership, design, construction,
refurbishment, development, delivery, acceptance, nondelivery, leasing,
subleasing, possession, use, operation, maintenance repair, modification,
transportation, condition, sale, return, repossession (whether by summary
proceedings or otherwise), or any other disposition of the Facility or any part
thereof, including the acquisition, holding or disposition of any interest in
the Facility, lease or agreement comprising a portion of any thereof; (b) any
latent or other defects in the Facility or any portion thereof whether or not
discoverable by an Indemnified Person or the Indemnity Provider; (c) a
violation of Environmental Laws, Environmental Claims or other loss of or
damage to any property or the environment relating to the Facility, the
Lease, the Agency Agreement or the Indemnity Provider; (d) the Operative
Agreements, or any transaction contemplated thereby; (e) any breach by
the Indemnity Provider of any of its representations or warranties under the
Operative Agreements to which the Indemnity Provider is a party or failure by
the Indemnity Provider to perform or observe any covenant or agreement to be
performed by it under any of the Operative Agreements; (f) the transactions
contemplated hereby or by any other Operative Agreement, in respect of the
application of Parts 4 and 5 of Subtitle B of Title I of ERISA; (g) personal
injury, death or property damage, including Claims based on strict or
absolute liability in tort; and (h) any failure or default by any Swap
Counterparty under or in connection with any Swap Agreement.
If a written Claim is made against any Indemnified Person or if any
proceeding shall be commenced against such Indemnified Person (including a
written notice of such proceeding), for any Claim, such Indemnified Person
shall promptly notify the Indemnity Provider in writing and shall not take
action with respect to such Claim without the consent of the Indemnity
Provider for thirty (30) days after the receipt of such notice by the
Indemnity Provider; provided, however, that, in the case of any such Claim,
if action shall be required by law or regulation to be taken prior to the end
of such 30-day period, such Indemnified Person shall, in such notice to the
Indemnity Provider, inform the Indemnity Provider of such shorter period, and
no action shall be taken with respect to such Claim without the consent of
the Indemnity Provider before 7 days before the end of such shorter period;
provided, further, that the failure of such Indemnified Person to give the
notices referred to in this sentence shall not diminish the Indemnity
Provider's obligation hereunder except to the extent such failure precludes
in all respects the Indemnity Provider from contesting such Claim.
If, within thirty (30) days of receipt of such notice from the Indemnified
Person (or such shorter period as the Indemnified Person has notified the
Indemnity Provider is required by law or regulation for the Indemnified
Person to respond to such Claim), the Indemnity Provider shall request in
writing that such Indemnified Person respond to such Claim, the Indemnified
Person shall, at the expense of the Indemnity Provider, in good faith conduct
and control such action (including, without limitation, by pursuit of appeals)
(provided, however, that (A) if such Claim, in the Indemnity Person's
reasonable discretion, can be pursued by the Indemnity Provider on behalf of
or in the name of such Indemnified Person, the Indemnified Person, at the
Indemnity Provider's request, shall allow the Indemnity Provider to conduct
and control the response to such Claim and (B) in the case of any Claim, the
Indemnified Person may request the Indemnity Provider to conduct and control
the response to such Claim (with counsel to be selected by the Indemnity
Provider and consented to by such Indemnified Person, such consent not to be
unreasonably withheld; provided, however, that any Indemnified Person may
retain separate counsel at the expense of the Indemnity Provider in the event
of a conflict)) by, in the sole discretion of the Person conducting and
controlling the response to such Claim (1) resisting payment thereof, (2)
not paying the same except under protest, if protest is necessary and proper,
(3) if the payment be made, using reasonable efforts to obtain a refund thereof
in appropriate administrative and judicial proceedings, or (4) taking such
other action as is reasonably requested by the Indemnity Provider from time
to time.
The party controlling the response to any Claim shall consult in good
faith with the non-controlling party and shall keep the non-controlling party
reasonably informed as to the conduct of the response to such Claim;
provided, that all decisions ultimately shall be made in the discretion of
the controlling party. The parties agree that an Indemnified Person may at
any time decline to take further action with respect to the response to such
Claim and may settle such Claim if such Indemnified Person shall waive its
rights to any indemnity from the Indemnity Provider that otherwise would be
payable in respect of such Claim (and any future Claim, the pursuit of which
is precluded by reason of such resolution of such Claim) and shall pay to the
Indemnity Provider any amount previously paid or advanced by the Indemnity
Provider pursuant to this Section 13.1 by way of indemnification or advance
for the payment of an amount regarding such Claim.
Notwithstanding the foregoing provisions of this Section 13.1, an
Indemnified Person shall not be required to take any action and no Indemnity
Provider shall be permitted to respond to any Claim in its own name or that
of the Indemnified Person unless (A) the Indemnity Provider shall have agreed
to pay and shall pay to such Indemnified Person on demand and on an After
Tax Basis all reasonable costs, losses and expenses that such Indemnified
Person actually incurs in connection with such Claim, including, without
limitation, all reasonable legal, accounting and investigatory fees and
disbursements and, if the Indemnified Person has informed the Indemnity
Provider (in its initial notice of the Claim) that it intends to contest such
Claim (whether or not the control of the contest is then assumed by the
Indemnity Provider), the Indemnity Provider shall have agreed that the Claim is
an indemnifiable Claim hereunder, (B) in the case of a Claim that must be
pursued in the name of an Indemnified Person (or an Affiliate thereof), the
amount of the potential indemnity (taking into account all similar or
logically related Claims that have been or could be raised for which the
Indemnity Provider may be liable to pay an indemnity under this Section 13.1)
exceeds $25,000, (C) the Indemnified Person shall have reasonably determined
that the action to be taken will not result in any material danger of sale,
forfeiture or loss of the Facility, or any part thereof or interest therein,
will not interfere with the payment of Rent, and will not result in risk of
criminal liability, (D) if such Claim shall involve the payment of any amount
prior to the resolution of such Claim, the Indemnity Provider shall provide
to the Indemnified Person an interest-free advance in an amount equal to the
amount that the Indemnified Person is required to pay (with no additional net
after-tax cost to such Indemnified Person), (E) in the case of a Claim that
must be pursued in the name of an Indemnified Person (or an Affiliate
thereof), the Indemnity Provider shall have provided to such Indemnified
Person an opinion of independent counsel selected by the Indemnified Person
and reasonably satisfactory to the Indemnity Provider stating that a
reasonable basis exists to contest such Claim (or, in the case of an appeal
of an adverse determination, an opinion of such counsel to the effect that the
position asserted in such appeal will more likely than not prevail) and (F) no
Event of Default shall have occurred and be continuing. In no event shall an
Indemnified Person be required to appeal an adverse judicial determination to
the United States Supreme Court. In addition, an Indemnified Person shall not
be required to contest any Claim in its name (or that of an Affiliate) if the
subject matter thereof shall be of a continuing nature and shall have
previously been decided adversely by a court of competent jurisdiction
pursuant to the contest provisions of this Section 13.1, unless there shall
have been a change in law (or interpretation thereof) and the Indemnified
Person shall have received, at the Indemnity Provider's expense, an opinion
of independent counsel selected by the Indemnified Person and reasonably
acceptable to the Indemnity Provider stating that as a result of such change
in law (or interpretation thereof), it is more likely than not that the
Indemnified Person will prevail in such contest.
13.2 General Tax Indemnity. (a) The Indemnity Provider shall pay and
assume liability for, and does hereby agree to indemnify, protect and defend
each Facility and all Indemnified Persons, and hold them harmless against,
all Impositions on an After Tax Basis, and all payments pursuant to the
Operative Agreements shall be made free and clear of and without deduction
for any and all present and future Impositions.
(b) Notwithstanding anything to the contrary in Section 13.2(a)
hereof, the following shall be excluded from the indemnity required by
Section 13.2(a):
(i) Taxes (other than Taxes that are, or are in the nature of,
sales, use, rental, value added, transfer or property taxes) that are
imposed on a Indemnified Person (other than Lessor) by the United
States federal government that are based on or measured by the net
income (including taxes based on capital gains and minimum taxes)
of such Person; provided, that this clause (i) shall not be
interpreted to prevent a payment from being made on an After Tax
Basis if such payment is otherwise required to be so made;
(ii) Taxes (other than Taxes that are, or are in the nature of,
sales, use, rental, value added, transfer or property taxes) that
are imposed on any Indemnified Person (other than Lessor) by any
state or local jurisdiction or taxing authority within any state
or local jurisdiction and that are based upon or measured by the
net income or net receipts, except that this clause (ii) shall not
apply to (and thus shall not exclude) any such Taxes imposed on an
Indemnified Person by the Approved State (or any local taxing
authority thereof or therein); provided, that this clause (ii)
shall not be interpreted to prevent a payment from being made on
an After Tax Basis if such payment is otherwise required to be so
made;
(iii) any Tax to the extent it relates to any act, event or
omission that occurs after the termination of the Lease and
redelivery or sale of the property in accordance with the terms of
the Lease (but not any Tax that relates to such termination,
redelivery or sale and/or to any period prior to such termination,
redelivery or sale); and
(iv) any Taxes which are imposed on an Indemnified Person as a
result of the gross negligence, wilful misconduct or wilful breach
of such Indemnified Person itself (as opposed to gross negligence,
wilful misconduct or wilful breach imputed to such Indemnified
Person), but not Taxes imposed as a result of ordinary negligence
of such Indemnified Person;
(c) (i) Subject to the terms of Section 13.2(f), the Indemnity
Provider shall pay or cause to be paid all Impositions directly to the
taxing authorities where feasible and otherwise to the Indemnified
Person, as appropriate, and the Indemnity Provider shall at its own
expense, upon such Indemnified Person's reasonable request, furnish to
such Indemnified Person copies of official receipts or other
satisfactory proof evidencing such payment.
(ii) In the case of Impositions for which no contest is
conducted pursuant to Section 13.2(f) and which the Indemnity
Provider pays directly to the taxing authorities, the Indemnity
Provider shall pay such Impositions prior to the latest time
permitted by the relevant taxing authority for timely payment. In
the case of Impositions for which the Indemnity Provider reimburses
an Indemnified Person, the Indemnity Provider shall do so within
thirty (30) days after receipt by the Indemnity Provider of demand
by such Indemnified Person describing in reasonable detail the
nature of the Imposition and the basis for the demand (including
the computation of the amount payable). In the case of Impositions
for which a contest is conducted pursuant to Section 13.2(f), the
Indemnity Provider shall pay such Impositions or reimburse such
Indemnified Person for such Impositions, to the extent not previously
paid or reimbursed pursuant to subsection (a), prior to the latest
time permitted by the relevant taxing authority for timely payment
after conclusion of all contests under Section 13.2(f).
(iii) At the Indemnity Provider's request, the amount of any
indemnification payment by the Indemnity Provider pursuant to
subsection (a) shall be verified and certified by an independent
public accounting firm mutually acceptable to the Indemnity
Provider and the Indemnified Person. The reasonable fees and
expenses of such independent public accounting firm shall be paid
by the Indemnity Provider unless such verification shall result in
an adjustment in the Indemnity Provider's favor of 15% or more of
the payment as computed by the Indemnified Person, in which case
such fee shall be paid by the Indemnified Person.
(d) The Indemnity Provider shall be responsible for preparing and
filing any real and personal property or ad valorem tax returns in
respect of the Facility. In case any other report or tax return shall
be required to be made with respect to any obligations of the Indemnity
Provider under or arising out of subsection (a) and of which the
Indemnity Provider has knowledge or should have knowledge, the Indemnity
Provider, at its sole cost and expense, shall notify the relevant
Indemnified Person of such requirement and (except if such Indemnified
Person notifies the Indemnity Provider that such Indemnified Person
intends to file such report or return) (A) to the extent required or
permitted by and consistent with Legal Requirements, make and file in
the Indemnity Provider's name such return, statement or report; and (B)
in the case of any other such return, statement or report required to
be made in the name of such Indemnified Person, advise such Indemnified
Person of such fact and prepare such return, statement or report for
filing by such Indemnified Person or, where such return, statement or
report shall be required to reflect items in addition to any obligations
of the Indemnity Provider under or arising out of subsection (a),
provide such Indemnified Person at the Indemnity Provider's expense
with information sufficient to permit such return, statement or report
to be properly made with respect to any obligations of the Indemnity
Provider under or arising out of subsection (a). Such Indemnified
Person shall, upon the Indemnity Provider's request and at the Indemnity
Provider's expense, provide any data maintained by such Indemnified
Person (and not otherwise available to or within the control of the
Indemnity Provider) with respect to the Facility which the Indemnity
Provider may reasonably require to prepare any required tax returns or
reports.
(e) As between the Indemnity Provider on one hand, and the Lessor or
the Administrative Agent, any Lender or the Holder on the other hand, the
Indemnity Provider shall be responsible for, and the Indemnity Provider
shall indemnify and hold harmless the Lessor, the Administrative Agent,
the Lenders and the Holder (without duplication of any indemnification
required by subsection (a)) on an After Tax Basis against, any
obligation for United States or foreign withholding taxes imposed in
respect of the interest payable on the Notes or with respect to Rent
payments under the Lease (and, if the Lessor, the Administrative Agent,
any Lender or the Holder receives a demand for such payment from any
taxing authority, the Indemnity Provider shall discharge such demand on
behalf of the Lessor, the Administrative Agent, such Lender or the
Holder); provided, however, that the right of any Lender to make a claim
for indemnification under this Section 13.2(e) is subject to the
compliance by such Lender with the requirements of Section 2.13 of the
Credit Agreement.
(f) (i) If a written Claim is made against any Indemnified Person or
if any proceeding shall be commenced against such Indemnified Person
(including a written notice of such proceeding), for any Impositions,
such Indemnified Person shall promptly notify the Indemnity Provider in
writing and shall not take action with respect to such Claim or
proceeding without the consent of the Indemnity Provider for thirty (30)
days after the receipt of such notice by the Indemnity Provider;
provided, however, that, in the case of any such Claim or proceeding, if
action shall be required by law or regulation to be taken prior to the
end of such 30-day period, such Indemnified Person shall, in such notice
to the Indemnity Provider, inform the Indemnity Provider of such shorter
period, and no action shall be taken with respect to such Claim or
proceeding without the consent of the Indemnity Provider before 7 days
before the end of such shorter period; provided, further, that the
failure of such Indemnified Person to give the notices referred to this
sentence shall not diminish the Indemnity Provider's obligation
hereunder except to the extent such failure precludes in all respects
the Indemnity Provider from contesting such Claim.
(ii) If, within thirty (30) days of receipt of such notice
from the Indemnified Person (or such shorter period as the
Indemnified Person has notified the Indemnity Provider is required
by law or regulation for the Indemnified Person to commence such
contest), the Indemnity Provider shall request in writing that such
Indemnified Person contest such Imposition, the Indemnified Person
shall, at the expense of the Indemnity Provider, in good faith
conduct and control such contest (including, without limitation, by
pursuit of appeals) relating to the validity, applicability or
amount of such Impositions (provided, however, that (A) if such
contest involves a tax other than a tax on net income and can be
pursued independently from any other proceeding involving a tax
liability of such Indemnified Person, the Indemnified Person, at
the Indemnity Provider's request, shall allow the Indemnity
Provider (and the Indemnity Provider shall be obligated) to conduct
and control such contest and (B) in the case of any contest, the
Indemnified Person may request the Indemnity Provider to conduct
and control such contest (with counsel to be selected by the
Indemnity Provider and consented to by such Indemnified Person,
such consent not to be unreasonably withheld; provided, however,
that any Indemnified Person may retain separate counsel at the
expense of the Indemnity Provider in the event of a conflict)) by,
in the sole discretion of the Person conducting and controlling
such contest, (1) resisting payment thereof, (2) not paying the
same except under protest, if protest is necessary and proper, (3)
if the payment be made, using reasonable efforts to obtain a refund
thereof in appropriate administrative and judicial proceedings, or
(4) taking such other action as is reasonably requested by the
Indemnity Provider from time to time.
(iii) The party controlling the contest of any Imposition
shall consult in good faith with the non-controlling party and
shall keep the non-controlling party reasonably informed as to the
conduct of such contest; provided, that all decisions ultimately
shall be made in the sole discretion of the controlling party. The
parties agree that an Indemnified Person may at any time decline to
take further action with respect to the contest of any Imposition
and may settle such contest if such Indemnified Person shall waive
its rights to any indemnity from the Indemnity Provider that
otherwise would be payable in respect of such Claim (and any future
Claim by any taxing authority, the contest of which is precluded by
reason of such resolution of such Claim) and shall pay to the
Indemnity Provider any amount previously paid or advanced by the
Indemnity Provider pursuant to this Section 13.2 by way of
indemnification or advance for the payment of an Imposition other
than expenses of such contest.
(iv) Notwithstanding the foregoing provisions of this
Section 13.2, an Indemnified Person shall not be required to take
any action and no Indemnity Provider shall be permitted to contest
any Impositions in its own name or that of the Indemnified Person
unless (A) the Indemnity Provider shall have agreed to pay and
shall pay to such Indemnified Person on demand and on an After Tax
Basis all reasonable costs, losses and expenses that such
Indemnified Person actually incurs in connection with contesting
such Impositions, including, without limitation, all reasonable
legal, accounting and investigatory fees and disbursements, and, if
the Indemnified Person has informed the Indemnity Provider (in its
initial notice of the Imposition) that it intends to contest such
Imposition (whether or not the control of the contest is then
assumed by the Indemnity Provider), the Indemnity Provider shall
have agreed that the Imposition is an indemnifiable Imposition
hereunder, (B) in the case of a Claim that must be pursued in the
name of an Indemnified Person (or an Affiliate thereof), the amount
of the potential indemnity (taking into account all similar or
logically related Claims that have been or could be raised in any
audit involving such Indemnified Person for which the Indemnity
Provider may be liable to pay an indemnity under this Section 13.2)
exceeds $25,000, (C) the Indemnified Person shall have reasonably
determined that the action to be taken will not result in any
material danger of sale, forfeiture or loss of any Facility, or any
part thereof or interest therein, will not interfere with the
payment of Rent, and will not result in risk of criminal liability,
(D) if such contest shall involve the payment of the Imposition
prior to the contest, the Indemnity Provider shall provide to the
Indemnified Person an interest-free advance in an amount equal to
the Imposition that the Indemnified Person is required to pay (with
no additional net after-tax cost to such Indemnified Person), (E) in
the case of a Claim that must be pursued in the name of an
Indemnified Person (or an Affiliate thereof), the Indemnity Provider
shall have provided to such Indemnified Person an opinion of
independent tax counsel selected by the Indemnified Person and
reasonably satisfactory to the Indemnity Provider stating that a
reasonable basis exists to contest such Claim (or, in the case of an
appeal or an adverse determination, an opinion of such counsel to
the effect that the position asserted in such appeal will more
likely than not prevail) and (F) no Default or Event of Default
shall have occurred and be continuing. In no event shall an
Indemnified Person be required to appeal an adverse judicial
determination to the United States Supreme Court. In addition, an
Indemnified Person shall not be required to contest any Claim in
its name (or that of an Affiliate) if the subject matter thereof
shall be of a continuing nature and shall have previously been
decided adversely by a court of competent jurisdiction pursuant to
the contest provisions of this Section 13.2, unless there shall have
been a change in law (or interpretation thereof) and the Indemnified
Person shall have received, at the Indemnity Provider's expense, an
opinion of independent tax counsel selected by the Indemnified
Person and reasonably acceptable to the Indemnity Provider stating
that as a result of such change in law (or interpretation thereof),
it is more likely than not that the Indemnified Person will prevail
in such contest.
SECTION XIV MISCELLANEOUS.
14.1 Survival of Agreements. The representations, warranties, covenants,
indemnities and agreements of the parties provided for in the Operative
Agreements, and the parties' obligations under any and all thereof, shall
survive the execution and delivery of this Agreement, the transfer of the
Facility to the Owner Trustee, the Completion of the Facility, any
disposition of any interest of the Owner Trustee in the Facility or any
interest of the Holder in the Owner Trust, the payment of the Notes and any
disposition thereof and shall be and continue in effect notwithstanding any
investigation made by any party and the fact that any party may waive
compliance with any of the other terms, provisions or conditions of any of
the Operative Agreements. Except as otherwise expressly set forth herein or
in other Operative Agreements, the indemnities of the parties provided for in
the Operative Agreements shall survive the expiration or termination of any
thereof.
14.2 No Broker, etc. Each of the parties hereto represents to the others
that it has not retained or employed any broker, finder or financial adviser to
act on its behalf in connection with this Agreement, nor has it authorized any
broker, finder or financial adviser retained or employed by any other Person so
to act. Any party who is in breach of this representation shall indemnify and
hold the other parties harmless from and against any liability arising out of
such breach of this representation.
14.3 Notices. All notices required or permitted to be given under this
Agreement shall be in writing. Notices may be served by certified or
registered mail, postage paid with return receipt requested; by private
courier, prepaid; by telex, facsimile, or other telecommunication device
capable of transmitting or creating a written record; or personally. Mailed
notices shall be deemed delivered five days after mailing, properly addressed.
Couriered notices shall be deemed delivered when delivered as addressed, or
if the addressee refuses delivery, when presented for delivery notwithstanding
such refusal. Telex or telecommunicated notices shall be deemed delivered when
receipt is either confirmed by confirming transmission equipment or
acknowledged by the addressee or its office. Personal delivery shall be
effective when accomplished. Unless a party changes its address by giving
notice to the other party as provided herein, notices shall be delivered to the
parties at the following addresses:
If to the Lessee or the Construction Agent, to it at the following address:
Georgia Gulf Corporation
400 Perimeter Center Terrace
Suite 595
Atlanta, Georgia 30346
Attention: Samuel M. Hensley, Corporate Controller
Telephone: (770) 395-4577
Telecopy: (770) 395-4529
If to the Owner Trustee, to it at the following address:
First Security Bank of Utah, N.A.
79 South Main Street
Salt Lake City, Utah 84111
Attention: Val T. Orton
Corporate Trust Counsel
Telephone: (801) 246-5300
Telecopy: (801) 246-5053
or to the extent that Mr. Val T. Orton is hereafter deemed to be the Owner
Trustee pursuant to the terms and provisions of Section 14.17 hereof, to
him at the following address:
Mr. Val T. Orton
c/o First Security Bank of Utah, N.A.
79 South Main Street
Salt Lake City, Utah 84111
Telephone: (801) 246-5300
Telecopy: (801) 246-5053
If to the Holder, at the address set forth for the Holder on the signature
page of the Trust Agreement.
If to the Administrative Agent, to it at the following address:
NationsBank, N.A. (South)
600 Peachtree Street, NE
21st Floor
Atlanta, Georgia 30308
Attention: Catherine S. Rhodes, Vice President
Telephone: (404) 607-5531
Telecopy: (404) 607-6484
with a copy to:
NationsBank, N.A.
101 North Tryon Street, NC1-001-15-04
15th Floor
Charlotte, N.C. 28255
Attention: Melissa P. Mullis, Corporate Credit Services
Representative
Telephone: (704) 386-2881
Telecopy: (704) 386-9923
If to any Lender, to it at the address set forth for such Lender in
Schedule 1.1 of the Credit Agreement.
From time to time any party may designate additional parties and/or
another address for notice purposes by notice to each of the other
parties hereto. Notice shall be effective upon receipt or refusal
thereof.
14.4 Counterparts. This Agreement may be executed by the parties hereto
in separate counterparts, each of which when so executed and delivered shall be
an original, but all such counterparts shall together constitute but one and
the same instrument.
14.5 Amendments and Termination. This Section 14.5 is subject to the
terms and provisions of Section 10.8 hereof. Neither this Agreement nor any
of the terms hereof or any other Operative Agreement may be terminated,
amended, supplemented, waived or modified except by an instrument in writing
signed by the party against which the enforcement of the termination,
amendment, supplement, waiver or modification shall be sought; provided,
notwithstanding the foregoing, to the extent any Operative Agreement
contemplates consideration of any issue by (a) the Majority Lenders, then
consideration of such issue shall be governed by the judgment of the Majority
Lenders or (b) all the Lenders, then consideration of such issue shall be
governed by the judgment of all the Lenders. This Agreement may be
terminated only by an agreement signed in writing by the Owner Trustee, the
Holder, the Lessee, the Lenders and the Administrative Agent.
14.6 Headings, etc. The Table of Contents and headings of the various
Articles and Sections of this Agreement are for convenience of reference only
and shall not modify, define, expand or limit any of the terms or provisions
hereof.
14.7 Parties in Interest. Except as expressly provided herein, none of
the provisions of this Agreement are intended for the benefit of any Person.
14.8 GOVERNING LAW; WAIVERS OF JURY TRIAL. (a) THIS AGREEMENT
SHALL IN ALL RESPECTS BE GOVERNED BY THE LAW OF THE STATE OF GEORGIA AS
TO ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
(b) 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 AGREEMENT AND FOR ANY
COUNTERCLAIM THEREIN.
14.9 Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
14.10 Liability Limited.
(a) The Administrative Agent, the Lenders, the Lessee and the Holder
each acknowledge and agree that the Owner Trustee is (except as otherwise
expressly provided herein or therein) entering into this Agreement and the
other Operative Agreements to which it is a party (other than the Trust
Agreement and to the extent otherwise provided in Section 7.2 of this
Agreement), solely in its capacity as trustee under the Trust Agreement
and not in its individual capacity and that Trust Company shall not be
liable or accountable under any circumstances whatsoever in its
individual capacity for or on account of any statements,
representations, warranties, covenants or obligations stated to be those
of the Owner Trustee, except for its own gross negligence, willful
misconduct or wilful breach and as otherwise expressly provided herein
or in the other Operative Agreements.
(b) Anything to the contrary contained in this Agreement, the Credit
Agreement, the Notes or in any other Operative Agreement notwithstanding,
neither the Lessor nor the Holder nor any officer, director or
shareholder, nor any of the successors or assigns of the foregoing (all
such Persons being hereinafter referred to collectively as the
"Exculpated Persons"), shall be personally liable in any respect for
any liability or obligation hereunder or in any other Operative
Agreement including the payment of the principal of, or interest on,
the Notes, or for monetary damages for the breach of performance of any
of the covenants contained in the Credit Agreement, the Notes, this
Agreement, the Security Agreement or any of the other Operative
Agreements. The Administrative Agent and the Lenders agree that, in
the event the Administrative Agent or any Lender pursues any remedies
available to them under the Credit Agreement, the Notes, this Agreement,
the Security Agreement or under any other Operative Agreement, neither
the Administrative Agent nor the Lenders shall have any recourse against
any Exculpated Person, for any deficiency, loss or Claim for monetary
damages or otherwise resulting therefrom and recourse shall be had
solely and exclusively against the Trust Estate and the Lessee (with
respect to the Lessee's obligations under the Lease, the Participation
Agreement and the Agency Agreement); but nothing contained herein
shall be taken to prevent recourse against or the enforcement of
remedies against the Trust Estate in respect of any and all
liabilities, obligations and undertakings contained herein, in the
Credit Agreement, in the Notes, in the Security Agreement or in any
other Operative Agreement. Notwithstanding the provisions of this
Section, nothing in this Agreement, the Credit Agreement, the Notes,
the Security Agreement or any other Operative Agreement shall:
(i) constitute a waiver, release or discharge of any indebtedness or
obligation evidenced by the Notes or arising under this Agreement, the
Security Agreement, the Credit Agreement or any other Operative
Agreement or secured by the Security Agreement or any other Operative
Agreement, but the same shall continue until paid or discharged; (ii)
relieve the Lessor or any Exculpated Person from liability and
responsibility for (but only to the extent of the damages arising by
reason of): any fraud, gross negligence, willful misconduct or willful
breach on the part of the Lessor or any such Exculpated Person; (iii)
relieve the Lessor or any Exculpated Person from liability and
responsibility for (but only to the extent of the moneys
misappropriated, misapplied or not turned over) (a) except for Holder
Excepted Amounts, misappropriation or misapplication by the Lessor
(i.e., application in a manner contrary to any Operative Agreement) of
any insurance proceeds or condemnation award paid or delivered to
the Lessor by any Person other than the Administrative Agent, (b)
except for Holder Excepted Amounts, any deposits or any escrows or
amounts owed by the Lessee under the Agency Agreement held by the
Lessor or (c) except for Holder Excepted Amounts, any rents or other
income received by the Lessor from the Lessee that are not turned over
to the Administrative Agent; or (iv) affect or in any way limit the
Administrative Agent's rights and remedies under any Operative Agreement
with respect to the Rents and its rights and powers thereunder or to
obtain a judgment against the Lessee's interest in the Facility or to
the extent the Lessee may be personally liable as otherwise contemplated
in clauses (ii) and (iii) of this Section.
14.11 Rights of Lessee. Notwithstanding any provision of the Operative
Agreements, if at any time all obligations (i) of the Owner Trustee under the
Credit Agreement and the Security Documents and (ii) of the Lessee under the
Operative Agreements have in each case been satisfied or discharged in full,
then the Lessee shall be entitled to (a) terminate the Lease and (b) receive
all amounts then held under the Operative Agreements and all proceeds with
respect to any of the Facility. Upon the termination of the Lease pursuant
to the foregoing clause (a), the Lessor shall transfer to the Lessee all of
its right, title and interest free and clear of the Lien of the Lease and all
Lessor Liens in and to the Facility then subject to the Lease and any amounts
or proceeds referred to in the foregoing clause (b) shall be paid over to the
Lessee.
14.12 Further Assurances. The parties hereto shall promptly cause to
be taken, executed, acknowledged or delivered, at the sole expense of the
Lessee, all such further acts, conveyances, documents and assurances as the
other parties may from time to time reasonably request in order to carry out
and effectuate the intent and purposes of this Participation Agreement, the
other Operative Agreements and the transactions contemplated hereby and
thereby (including, without limitation, the preparation, execution and filing
of any and all Uniform Commercial Code financing statements, filings of
Mortgage Instruments and other filings or registrations which the parties
hereto may from time to time request to be filed or effected). The Lessee,
at its own expense and without need of any prior request from any other
party, shall take such action as may be necessary (including any action
specified in the preceding sentence), or (if Owner Trustee shall so request)
as so requested, in order to maintain and protect all security interests
provided for hereunder or under any other Operative Agreement.
14.13 Calculations under Operative Agreements. The parties hereto agree
that all calculations and numerical determinations to be made under the
Operative Agreements by the Owner Trustee shall be made by the
Administrative Agent and that such calculations and determinations shall be
conclusive and binding on the parties hereto in the absence of manifest error.
14.14 Confidentiality. Each of the Owner Trustee, the Holder, the
Administrative Agent and the Lenders severally agrees to use reasonable
efforts to keep confidential all non-public information pertaining to the
Lessee or its Subsidiaries which is provided to it by the Lessee or its
Subsidiaries and which an officer of the Lessee or any of its Subsidiaries
has requested in writing be kept confidential, and shall not intentionally
disclose such information to any Person except:
(a) to the extent such information is public when received by such
Person or becomes public thereafter due to the act or omission of any
party other than such Person;
(b) to the extent such information is independently obtained from a
source other than the Lessee or any of its Subsidiaries and such
information from such source is not, to such Person's knowledge, subject
to an obligation of confidentiality or, if such information is subject
to an obligation of confidentiality, that disclosure of such information
is permitted;
(c) to counsel, auditors, accountants or agents retained by any such
Person or any Affiliates of any such Person provided they agree to keep
such information confidential as if such Person or Affiliate were party
to this Agreement and to financial institution regulators, including
examiners of any Lender, the Administrative Agent or the Owner Trustee,
the Holder or any Affiliate in the course of examinations of such
Persons;
(d) in connection with any litigation or the enforcement or
preservation of the rights of the Administrative Agent, the Owner
Trustee, the Lessor, any Lender or the Holder under the Operative
Agreements;
(e) to the extent required by any applicable statute, rule or
regulation or court order (including, without limitation, by way of
subpoena) or pursuant to the request of any regulatory or Governmental
Authority having jurisdiction over any such Person; provided, however,
that such Person shall endeavor (if not otherwise prohibited by Law) to
notify the Lessee prior to any disclosure made pursuant to this clause
(e), except that no such Person shall be subject to any liability
whatsoever for any failure to so notify the Lessee;
(f) the Administrative Agent may disclose such information to the
Lenders; or
(g) to the extent disclosure to other financial institutions or
other Persons is appropriate in connection with any proposed or actual
(i) assignment or grant of a participation by any of the Lenders of
interests in the Credit Agreement and/or any Note to such other
financial institutions (who will in turn be required by the
Administrative Agent to agree in writing to maintain confidentiality as
if they were Lenders originally party to the Credit Agreement) or (ii)
assignment by the Holder of interests in the Trust Agreement to another
Person (who will in turn be required by the transferring Holder to
agree in writing to maintain confidentiality as if it were a Holder
originally party to this Participation Agreement).
14.15 Conversion of Transaction into a Secured Loan. At any time during
the Construction Period or the Term of the Lease, Lessee, at its option, may
elect to convert this Transaction into a secured loan on the same general
terms, conditions and economics set forth in the Operative Agreements. Such
conversion shall be subject to negotiation, execution and delivery of
documentation reasonably satisfactory to all parties. Lessee shall pay any
and all Transaction Expenses.
14.16 Swap Agreement. Upon the request of the Lessee, the Owner Trustee
shall within 30 days of such request enter into a Swap Agreement; provided, the
Owner Trustee shall have no obligation under any such Swap Agreement except to
pay an amount equal to Contingent Rent received by the Owner Trustee from the
Lessee. The Owner Trustee hereby authorizes and directs the Lessee to pay
from time to time Contingent Rent directly to the appropriate Swap Counterparty
in amounts due and owing from time to time under the applicable Swap Agreement
and shall request and direct any Swap Counterparty to make payments owed to the
Owner Trustee under the Swap Agreement directly to the Lessee. The Lessee
shall cause Contingent Rent to be excluded from the Collateral. The Swap
Counterparty shall be deemed a third party beneficiary of this Agreement for
purposes of this Section 14.16.
14.17 Substitute Owner Trustee; Owner Trustee Advisor. First Security
Bank of Utah, N.A. has entered into this Agreement and the other Operative
Agreements not individually, except as expressly stated herein or therein
(as the case may be), but solely as Owner Trustee under the GGC Trust 1996-1;
provided, notwithstanding the foregoing provisions of this Section 14.17,
solely to the extent that the Louisiana Trust Code (L.A. R.S. 9:1721 et. seq.)
is deemed to apply to the GGC Trust 1996-1, then (a) Mr. Val T. Orton, a
resident of Davis County, Utah shall be deemed to be the sole Owner Trustee
with respect to the GGC Trust 1996-1 and (b) First Security Bank of Utah,
N.A. (and any replacement or successor thereto appointed by the Holder with
the consent of the Majority Lenders) shall be deemed to be the Owner Trustee
Advisor. To the extent not prohibited by the Louisiana Trust Code, in his
capacity as Owner Trustee, Mr. Val T. Orton shall act in accordance with the
express, written directions of the Owner Trustee Advisor and any actions not
in accordance with such directions shall be deemed null and void and of no
force or effect under the Operative Agreements or otherwise. In its capacity
as Owner Trustee Advisor, First Security Bank of Utah, N.A. shall act (x) in
accordance with the directions, limitations, terms and provisions of the
Operative Agreements otherwise applicable to the Owner Trustee and (y) to the
extent the Operative Agreements do not contain any direction, limitation,
term or provision with regard to any particular situation, in accordance with
the written instructions of the Holder. Actions taken by the Owner Trustee
Advisor which are not in accordance with the requirements of the immediately
preceding sentence shall be deemed null and void and of no force or effect
under the Operative Agreements or otherwise.
[signature pages follow]
THUS DONE AND PASSED in _____________, ___________ on the ___ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: GEORGIA GULF CORPORATION, as
Construction Agent and as Lessee
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in _____________, __________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: FIRST SECURITY BANK OF UTAH, N.A.,
not individually, except as expressly stated herein,
but solely as Owner Trustee under the GGC Trust 1996-1
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in ___________________, _________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: NATIONSBANC LEASING CORPORATION OF
NORTH CAROLINA, as the Holder
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in ______________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: NATIONSBANK, N.A.(SOUTH), as the Administrative
Agent for the Lenders
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in ______________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: ABN AMRO BANK N.V., as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in _________________, ___________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: BANK OF MONTREAL, as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in ___________________, ________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: THE BANK OF NEW YORK, as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in _______________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: THE BANK OF NOVA SCOTIA, as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in _____________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: THE BANK OF TOKYO TRUST COMPANY, as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in ___________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: THE CHASE MANHATTAN BANK, N.A., as a Lender
By:
Name:
Title
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in ____________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: THE DAI-ICHI KANGYO BANK, LIMITED, ATLANTA
AGENCY, as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in _____________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: THE FUJI BANK, LTD., as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in ____________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: THE INDUSTRIAL BANK OF JAPAN, LIMITED,
as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in _____________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: THE SAKURA BANK, LIMITED, ATLANTA
AGENCY, as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in ______________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: RABOBANK NEDERLAND, NEW YORK BRANCH, as
a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in _____________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: RABOBANK NEDERLAND, NEW YORK BRANCH, as
a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in _____________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: THE TOKAI BANK, LIMITED, ATLANTA
AGENCY, as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in ____________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: WACHOVIA BANK OF GEORGIA, N.A., as a Lender
By:
Name:
Title:
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in ____________, ______________ on the ____ day
of February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with the undersigned party and me, Notary, after due reading of the whole.
WITNESSES: AGREED:
Val T. Orton, subject to Section 6.9 of the Trust
Agreement, as Owner Trustee
Notary Public
Printed Name:
My Commission Expires:
EXHIBIT A
REQUISITION FORM
(Pursuant to Sections 4.2 and 5.2 of the Participation Agreement)
GEORGIA GULF CORPORATION, a Delaware corporation (the "Company") hereby
certifies as true and correct and delivers the following Requisition to
First Security Bank of Utah, N.A., not individually, except as expressly
stated in the Participation Agreement (hereinafter defined), but solely as
Owner Trustee under the GGC Trust 1996-1 ("Lessor"), NationsBanc Leasing
Corporation of North Carolina, as the holder (the "Holder"), the Lenders
party thereto (subject to the definition of Lenders in Appendix A hereto,
individually, a "Lender" and collectively, the "Lenders") and NationsBank,
N.A. (South), as administrative agent for the Lenders pursuant to the Credit
Agreement (the "Administrative Agent"):
Reference is made herein to that certain Participation Agreement dated as
of February 6, 1996 (as such may be amended from time to time, the
"Participation Agreement") among the Company, in its capacity as Lessee and
as Construction Agent, the Lessor, the Holder, the Lenders and the
Administrative Agent. Capitalized terms used herein but not otherwise
defined herein shall have the meanings set forth therefor in the
Participation Agreement.
Check one:
____ INITIAL CLOSING DATE: _________________
(three Business Days prior notice required for Funding)
____ FACILITY CLOSING DATE:_________________
(three Business Days prior notice required for Funding)
____ CONSTRUCTION FUNDING DATE:_____________
(three Business Days prior notice required for Funding)
1. Transaction Expenses and other fees, expenses and disbursements under
Section 9.1(a) or (b) of the Participation Agreement and any and all
other amounts contemplated to be financed under the Participation
Agreement including without limitation any Work, broker's fees, taxes,
recording fees and the like (with supporting invoices or closing
statement attached):
Party to Whom Amount Owed
Amount is Owed (in U.S. Dollars)
2. Legal Description of Land (which shall be a legal description of the Land
in connection with Facility Closing Date and which is otherwise
unnecessary): See attached Schedule 1
3. Description of Additions: See attached Schedule 2
4. Description of Equipment: See attached Schedule 3
5. Description of Work: See attached Schedule 4
6. Aggregate Loans and Holder Fundings requested since the Closing Date,
including all the amounts requested under this Requisition: $____________
In connection with this Requisition, the Company hereby requests that the
Lenders make Loans to the Lessor in the amount of $______________ and that the
Holder make Holder Fundings to the Lessor in the amount of $________________.
The Company hereby certifies (i) that the foregoing amounts requested do not
exceed the total aggregate of the Available Commitments plus the Available
Holder Commitment and (ii) each of the provisions of the Participation
Agreement applicable to the Loans and Holder Fundings requested hereunder
have been complied with as of the date of this Requisition.
The Company has caused this Requisition to the executed by its duly
authorized officer as of this _____ day of __________, 199__.
GEORGIA GULF CORPORATION
By:
Name:
Title:
Schedule 1
Legal Description of Land
Schedule 2
Description of Additions
Schedule 3
Description of Equipment
General Description Make Model Serial Number
Schedule 4
Work
Work Performed for which the Funding is requested:
EXHIBIT B
GEORGIA GULF CORPORATION
OFFICER'S CERTIFICATE
(Pursuant to Section 5.5 of the Participation Agreement)
GEORGIA GULF CORPORATION, a Delaware corporation (the "Company") DOES HEREBY
CERTIFY as follows:
1. The address for the Facility is _______________________________________.
2. The Completion Date for the Facility occurred on ______________.
3. The aggregate Facility Cost for the Facility is $___________.
4. Attached hereto as Schedule I is the detailed, itemized documentation
supporting the asserted expenditure amounts referenced above in Section
3 of this Officer's Certificate.
5. The amount of the asserted Facility Cost for (a) personal property cost is
$________ and (b) real property cost is $________, in each case for
purposes of determining appropriate amounts therefor under the
applicable Louisiana sales tax Laws.
6. All Equipment has been acquired, installed and is operational and all
Additions have been made in accordance with all applicable material
Legal Requirements and the Construction Contracts in a good and
workmanlike manner in accordance with the Plans and Specifications
(except to the extent that any deviation from the Plans and
Specifications could not reasonably be expected to materially impair
the value, utility, economic life or operation of the Facility)
and otherwise in full compliance with the standards and practices of
the Company with respect to Company-owned equipment, properties and
additions.
7. The Facility is a Qualifying Facility.
8. All consents, licenses, permits, authorizations, assignments and building
permits required as of such date by all material Legal Requirements or
pursuant to the terms of any contract, indenture, instrument or
agreement for the acquisition, ownership, construction, completion,
occupancy, operation, leasing or subleasing of the Facility have been
obtained and are in full force and effect, except to the extent that
the failure to so obtain would not reasonably be expected to,
individually or in the aggregate, have a Material Adverse Effect.
9. Final Completion (as such term is defined in the GE Construction Contract)
of the Facility has been achieved in accordance with the terms and
provisions of the GE Construction Contract.
Capitalized terms used in this Officer's Certificate and not otherwise defined
have the respective meanings ascribed thereto in the Participation Agreement
dated as of February __, 1996 among the Company, as Lessee, NationsBanc
Leasing Corporation of North Carolina, as the Holder, the Lenders party
thereto, First Security Bank of Utah, N.A., as Owner Trustee and
NationsBank, N.A. (South), as the Administrative Agent.
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be
duly executed and delivered as of this ____ day of ______________, 199__.
GEORGIA GULF CORPORATION
By:
Name:
Title:
Schedule I
Detailed, Itemized Documentation Supporting Facility Cost
EXHIBIT C
[Outside Counsel Opinion for Lessee]
(Pursuant to Section 6.1(c) of the Participation Agreement)
__________ ___, 1996
TO THOSE ON THE ATTACHED DISTRIBUTION LIST
Re: Tax Retention Operating Lease Financing Provided in favor of Georgia
Gulf Corporation
Dear Sirs:
We have acted as special counsel to Georgia Gulf Corporation, a Delaware
corporation (the "Lessee") in connection with certain transactions
contemplated by the Participation Agreement dated as of February 6, 1996
(the "Participation Agreement"), among the Lessee, First Security Bank of Utah,
N.A. (the "Owner Trustee"), NationsBanc Leasing Corporation of North Carolina,
as the Holder (the "Holder"), the lenders party thereto (individually, a
"Lender" and collectively, the "Lenders"), and NationsBank, N.A. (South), as
the administrative agent for the Lenders pursuant to the Credit Agreement
(the "Administrative Agent"). This opinion is delivered pursuant to Section
6.1(c) of the Participation Agreement. All capitalized terms used herein,
and not otherwise defined herein, shall have the meanings assigned thereto in
Appendix A to the Participation Agreement.
In connection with the foregoing, we have examined originals, or copies
certified to our satisfaction, of the Operative Agreements, and such other
corporate documents and records of the Lessee, certificates of public
officials and representatives of the Lessee as to certain factual matters,
and such other instruments and documents which we have deemed necessary or
advisable to examine for the purpose of this opinion. With respect to such
examination, we have assumed (i) the statements of fact made in all such
certificates, documents and instruments are true, accurate and complete;
(ii) the due authorization, execution and delivery of the Operative
Agreements by the parties thereto other than the Lessee; (iii) the
genuineness of all signatures (other than the signatures of persons signing
on behalf of the Lessee), the authenticity and completeness of all documents,
certificates, instruments, records and corporate records submitted to us as
originals and the conformity to the original instruments of all documents
submitted to us as copies, and the authenticity and completeness of the
originals of such copies; (iv) that all parties other than the Lessee have
all requisite corporate power and authority to execute, deliver and perform
the Operative Agreements; and (v) the enforceability of the Operative
Agreements against all parties thereto other than the Lessee.
Based on the foregoing, and having due regard for such legal considerations
as we deem relevant, and subject to the limitations and assumptions set
forth herein, including the matters set forth in the last two paragraphs
hereof, we are of the opinion that:
(a) The Lessee is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware and has the power and
authority to conduct its business as presently conducted and to execute,
deliver and perform its obligations under the Operative Agreements to which
it is a party. The Lessee is duly qualified to do business in all
jurisdictions in which its failure to so qualify would materially impair its
ability to perform its obligations under the Operative Agreements to which it
is a party or its financial position or its business as now and now proposed
to be conducted.
(b) The execution, delivery and performance by the Lessee of the
Operative Agreements to which it is a party have been duly authorized by all
necessary corporate action on the part of the Lessee and the Operative
Agreements to which the Lessee is a party have been duly executed and
delivered by the Lessee.
(c) The Operative Agreements to which the Lessee is a party constitute
valid and binding obligations of the Lessee enforceable against the Lessee in
accordance with the terms thereof, subject to bankruptcy, insolvency,
liquidation, reorganization, fraudulent conveyance, and similar laws
affecting creditors' rights generally, and general principles of equity
(regardless of whether the application of such principles is considered in a
proceeding in equity or at law).
(d) The execution and delivery by the Lessee of the Operative Agreements
to which it is a party and compliance by the Lessee with all of the provisions
thereof do not and will not (i) contravene the provisions of, or result in
any breach of or constitute any default under, or result in the creation of
any Lien (other than Permitted Liens) upon any of its property under, its
Articles of Incorporation or By-Laws or any indenture, mortgage, chattel
mortgage, deed of trust, lease, conditional sales contract, bank loan or
credit agreement or other agreement or instrument to which the Lessee is a
party or by which it or any of its property may be bound or affected, or (ii)
contravene any Laws or any order of any Governmental Authority applicable to
or binding on the Lessee.
(e) No Governmental Action by, and no notice to or filing with, any
Governmental Authority is required for the due execution, delivery or
performance by the Lessee of any of the Operative Agreements to which it is
a party or for the acquisition, ownership, construction and completion of
the Facility, except for those which have been obtained.
(f) There are no actions, suits or proceedings pending or to our
knowledge, threatened against the Lessee in any court or before any
Governmental Authority, that concern the Facility or the Lessee's interest
therein or that question the validity or enforceability of any Operative
Agreement to which the Lessee is a party or the overall transaction described
in the Operative Agreements to which the Lessee is a party.
(g) Neither the nature of the Facility, nor any relationship between the
Lessee and any other Person, nor any circumstance in connection with the
execution, delivery and performance of the Operative Agreements to which the
Lessee is a party is such as to require any approval of stockholders of, or
approval or consent of any trustee or holders of indebtedness of, the Lessee,
except for such approvals and consents which have been duly obtained and are
in full force and effect.
(h) The Security Agreement creates, for the benefit of the holders of the
Notes and the Holder, the security interest in the Collateral described therein
which by its terms it purports to create. Upon filing of the UCC-1 financing
statements with ______________ [identify filing offices], the Administrative
Agent and the Holder will have a perfected security interest in that portion
of the Collateral which can be perfected by such filing under Article 9 of
the UCC.
(i) The Contract Collateral Agreement creates, for the benefit of the
holders of the Notes and the Holder, the security interest in the Contract
Collateral described therein which by its terms it purports to create. Upon
filing of the UCC-1 financing statements with ______________ [identify
filing offices], the Administrative Agent and the Holder will have a
perfected security interest in that portion of the Contract Collateral which
can be perfected by such filing under Article 9 of the UCC.
(j) The issuance, sale and delivery of the Notes and the issuance and
delivery of the Certificates under the circumstances contemplated by the
Participation Agreement do not, under existing law, require registration of
the Notes or the certificates being issued on the date hereof under the
Securities Act of 1933, as amended, or the qualification of the Loan
Agreement under the Trust Indenture Act of 1939, as amended.
(k) The Operative Agreements (other than the Trust Agreement) to which
First Security Bank of Utah, N.A., individually or as Owner Trustee, as the
case may be, is a party constitute valid and binding obligations of First
Security Bank of Utah, N.A., individually or as Owner Trustee, as the case
may be, enforceable against First Security Bank of Utah, N.A., individually
or as Owner Trustee, in accordance with the terms thereof, subject to
bankruptcy, insolvency, liquidation, reorganization, fraudulent conveyance,
and similar laws affecting creditors rights generally, and general principles
of equity (regardless of whether the application of such principles is
considered in a proceeding in equity or at law).
(l) The execution and delivery by First Security Bank of Utah, N.A.,
individually or as Owner Trustee, as the case may be, of the Operative
Agreements (other than the Trust Agreement) to which it is a party and
compliance by First Security Bank of Utah, N.A., individually or as Owner
Trustee, with all of the provisions thereof do not and will not contravene
any law, rule or regulation of the State of Georgia.
(m) By reason of their participation in the transaction contemplated
under the Operative Agreements, none of the Administrative Agent, the
Lenders, the Holder or the Owner Trustee has to (a) qualify as a foreign
corporation in the State of Georgia, (b) file any application or any
designation for service of process in the State of Georgia or (c) pay any
franchise, income, sales, excise, stamp or other taxes of any kind to the
State of Georgia.
This opinion is limited to the matters stated herein and no opinion is
implied or may be inferred beyond the matters stated herein. This opinion is
based on and is limited to the laws of the State of Delaware, the State of
Georgia and the federal laws of the United States of America. Insofar as the
foregoing opinion relates to matters of law other than the foregoing, no
opinion is hereby given.
This opinion is for the sole benefit of Lessee, the Administrative Agent, the
Holder, the Lenders, First Security Bank of Utah, N.A., not individually, but
solely as Owner Trustee under the GGC Trust 1996-1 and their respective
successors and assigns and may not be relied upon by any other person other
than such parties and their respective successors and assigns without the
express written consent of the undersigned. The opinions expressed herein
are as of the date hereof and we make no undertaking to amend or supplement
such opinions if facts come to our attention or changes in the current law of
the jurisdictions mentioned herein occur which could affect such opinions.
Very truly yours,
[LESSEE'S OUTSIDE COUNSEL]
Distribution List
First Security Bank of Utah, N.A., not individually, but solely as Owner
Trustee under the GGC Trust 1996-1
NationsBanc Leasing Corporation of North Carolina, as the Holder
ABN Amro Bank N.V., as a Lender
Bank of Montreal, as a Lender
The Bank of New York, as a Lender
The Bank of Nova Scotia, as a Lender
The Bank of Tokyo Trust Company, as a Lender
The Chase Manhattan Bank, N.A., as a Lender
The Dai-Ichi Kangyo Bank, Limited, Atlanta Agency, as a Lender
The Fuji Bank, Ltd., as a Lender
The Industrial Bank of Japan, Limited, as a Lender
The Sakura Bank, Limited, Atlanta Agency, as a Lender
Rabobank Nederland, New York Branch, as a Lender
The Tokai Bank, Limited, Atlanta Agency, as a Lender
Wachovia Bank of Georgia, N.A., as a Lender
NationsBank, N.A. (South), as the Administrative Agent
EXHIBIT D
GEORGIA GULF CORPORATION
OFFICER'S CERTIFICATE
(Pursuant to Section 6.1(g) of the Participation Agreement)
GEORGIA GULF CORPORATION, a Delaware corporation (the "Company"), DOES
HEREBY CERTIFY as follows:
1. Each and every representation and warranty of the Company contained in the
Operative Agreements to which it is a party is true and correct in all
material respects on and as of the date hereof.
2. No Default or Event of Default has occurred and is continuing under any
Operative Agreement.
3. Each Operative Agreement to which the Company is a party is in full force
and effect with respect to it.
4. The Company has performed and complied with all covenants, agreements and
conditions contained in the Participation Agreement (hereinafter defined)
or in any Operative Agreement required to be performed or complied with by
it on or prior to the date hereof.
Capitalized terms used in this Officer's Certificate and not otherwise defined
herein have the respective meanings ascribed thereto in the Participation
Agreement dated as of February 6, 1996 among the Company, as Lessee,
NationsBanc Leasing Corporation of North Carolina, as the holder (the
"Holder"), the lenders party thereto (subject to the definition of Lenders in
Appendix A hereto, individually, a "Lender" and collectively, the "Lenders")
and NationsBank, N.A. (South), as administrative agent for the Lenders
pursuant to the Credit Agreement (the "Administrative Agent").
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be
duly executed and delivered as of this _____ day of __________, 1996.
GEORGIA GULF CORPORATION
By:
Name:
Title:
EXHIBIT E
GEORGIA GULF CORPORATION
OFFICER'S CERTIFICATE
(Pursuant to Section 6.1(h) of the Participation Agreement)
GEORGIA GULF CORPORATION, a Delaware corporation (the "Company") DOES
HEREBY CERTIFY as follows:
1. Attached hereto as Schedule I is a true, correct and complete copy of the
resolutions of the Board of Directors of the Company duly adopted by the
Board of Directors of the Company on __________. Such resolutions have
not been amended, modified or rescinded since their date of adoption and
remain in full force and effect as of the date hereof.
2. Attached hereto as Schedule II is a true, correct and complete copy of the
Articles of Incorporation of the Company on file in the Office of the
Secretary of State of the State of Delaware. Such Articles of
Incorporation have not been amended, modified or rescinded since their
date of adoption and remain in full force and effect as of the date
hereof.
3. Attached hereto as Schedule III is a true, correct and complete copy of
the Bylaws of the Company. Such Bylaws have not been amended, modified
or rescinded since their date of adoption and remain in full force and
effect as of the date hereof.
4. The persons named below now hold the offices set forth opposite their
names, and the signatures opposite their names and titles are their
true and correct signatures.
Name Office Signature
____________________ _________________ __________________
____________________ _________________ __________________
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be
duly executed and delivered as of this _____ day of ___________, 1996.
GEORGIA GULF CORPORATION
By:
Name:
Title:
Schedule I
Board Resolutions
Schedule II
Articles of Incorporation
Schedule III
Bylaws
EXHIBIT F
FIRST SECURITY BANK OF UTAH, N.A.
OFFICER'S CERTIFICATE
(Pursuant to Section 6.2(d) of the Participation Agreement)
FIRST SECURITY BANK OF UTAH, N.A., not individually (except with respect
to paragraph 1 below, to the extent any such representations and warranties
are made in its individual capacity) but solely as owner trustee under the
GGC Trust 1996-1 (the "Owner Trustee"), DOES HEREBY CERTIFY as follows:
(a) Each and every representation and warranty of the Owner Trustee contained
in the Operative Agreements to which it is a party is true and correct on
and as of the date hereof.
(b) Each Operative Agreement to which the Owner Trustee is a party is in full
force and effect with respect to it.
(c) The Owner Trustee has duly performed and complied with all covenants,
agreements and conditions contained in the Participation Agreement
(hereinafter defined) or in any Operative Agreement required to be
performed or complied with by it on or prior to the date hereof.
Capitalized terms used in this Officer's Certificate and not otherwise defined
herein have the respective meanings ascribed thereto in the Participation
Agreement dated as of February 6, 1996 among Georgia Gulf Corporation, as
Lessee, NationsBanc Leasing Corporation of North Carolina, as the holder (the
"Holder"), the lenders party thereto (subject to the definition of Lenders in
Appendix A hereto, individually, a "Lender" and collectively, the "Lenders")
and NationsBank, N.A. (South), as administrative agent for the Lenders
pursuant to the Credit Agreement (the "Administrative Agent").
IN WITNESS WHEREOF, the Owner Trustee has caused this Officer's Certificate to
be duly executed and delivered as of this _____ day of __________ 1996.
FIRST SECURITY BANK OF UTAH, N.A., not
individually, except as expressly stated herein,
but solely as Owner Trustee under the GGC Trust
1996-1
By:
Name:
Title:
EXHIBIT G
FIRST SECURITY BANK OF UTAH, N.A.
OFFICER'S CERTIFICATE
(Pursuant to Section 6.2(e) of the Participation Agreement)
FIRST SECURITY BANK OF UTAH, N.A., a national banking association (the
"Owner Trustee") DOES HEREBY CERTIFY as follows:
1. Attached hereto as Schedule I is a true, correct and complete copy of the
resolutions of the Board of Directors of the Owner Trustee duly adopted
by the Board of Directors of the Owner Trustee on __________. Such
resolutions have not been amended, modified or rescinded since their
date of adoption and remain in full force and effect as of the date
hereof.
2. Attached hereto as Schedule II is a true, correct and complete copy of the
Articles of Association of the Owner Trustee on file in the Office of the
Comptroller of the Currency. Such Articles of Association have not been
amended, modified or rescinded since their date of adoption and remain
in full force and effect as of the date hereof.
3. Attached hereto as Schedule III is a true, correct and complete copy of
the Bylaws of the Owner Trustee. Such Bylaws have not been amended,
modified or rescinded since their date of adoption and remain in full
force and effect as of the date hereof.
4. The persons named below now hold the offices set forth opposite their
names, and the signatures opposite their names and titles are their true
and correct signatures.
Name Office Signature
____________________ _________________ __________________
____________________ _________________ __________________
IN WITNESS WHEREOF, the Owner Trustee has caused this Officer's Certificate to
be duly executed and delivered as of this _____ day of __________ 1996.
FIRST SECURITY BANK OF UTAH, N.A.
By:
Name:
Title:
Schedule I
Board Resolutions
Schedule II
Articles of Association
Schedule III
Bylaws
EXHIBIT H
[Outside Counsel Opinion for Owner Trustee]
(Pursuant to Section 6.2(f) of the
Participation Agreement)
__________ __, 1996
TO THOSE ON THE ATTACHED DISTRIBUTION LIST
Re: Trust Agreement dated as of February 6, 1996
Dear Sirs:
We have acted as special counsel for First Security Bank of Utah, N.A., a
national banking association, in its individual capacity ("FSB") and in its
capacity as trustee (the "Owner Trustee") under the Trust Agreement dated as
of February 6, 1996 (the "Trust Agreement") by and among it and NationsBanc
Leasing Corporation of North Carolina (the "Holder"), in connection with the
execution and delivery by the Owner Trustee of the Operative Agreements to
which it is a party. Except as otherwise defined herein, the terms used
herein shall have the meanings set forth in Appendix A to the Participation
Agreement dated as of February 6, 1996 (the "Participation Agreement") by and
among Georgia Gulf Corporation, the Holder, First Security Bank of Utah,
N.A., in its individual capacity as expressly set forth therein and otherwise
as Owner Trustee and the lenders party thereto (individually, a "Lender" and
collectively, the "Lenders") and NationsBank, N.A. (South), as the
administrative agent for the Lenders pursuant to the Credit Agreement (the
"Administrative Agent").
We have examined originals or copies, certified or otherwise identified to our
satisfaction, of such documents, corporate records and other instruments as
we have deemed necessary or advisable for the purpose of rendering this
opinion.
Based upon the foregoing, we are of the opinion that:
1. FSB is a national banking association duly organized, validly
existing and in good standing under the laws of United States of
America and each of FSB and the Owner Trustee has under the laws of the
State of Utah and federal banking law the power and authority to enter
into and perform its obligations under the Trust Agreement and each
other Operative Agreement to which it is a party.
2. The Owner Trustee is the duly-appointed trustee under the Trust
Agreement.
3. The Trust Agreement has been duly authorized, executed and delivered
by one of the officers of FSB and, assuming due authorization, execution
and delivery by the Holder, is a legal, valid and binding obligation of
the Owner Trustee (and to the extent set forth therein, against FSB),
enforceable against the Owner Trustee (and to the extent set forth
therein, against FSB) in accordance with its terms, and the Trust
Agreement creates under the laws of the State of Utah for the Holder the
beneficial interest in the Trust Estate it purports to create and is a
valid trust under the laws of the State of Utah.
4. The Operative Agreements to which it is party have been duly
authorized, executed and delivered by FSB, and, assuming due
authorization, execution and delivery by the other parties thereto, are
legal, valid and binding obligations of FSB, enforceable against FSB in
accordance with their respective terms.
5. The Operative Agreements to which it is party have been duly
authorized, executed and delivered by the Owner Trustee, and, assuming
due authorization, execution and delivery by the other parties thereto,
are legal, valid and binding obligations of the Owner Trustee,
enforceable against the Owner Trustee in accordance with their
respective terms. The Notes and the Certificates have been duly issued,
executed and delivered by the Owner Trustee, pursuant to authorization
contained in the Trust Agreement, and the Certificates are entitled
to the benefits and security afforded by the Trust Agreement in
accordance with its terms and the terms of the Trust Agreement.
6. The execution and delivery by each of FSB and the Owner Trustee of
the Trust Agreement and the Operative Agreements to which it is a party,
and compliance by FSB or Owner Trustee, as the case may be, with all of
the provisions thereof do not and will not contravene any Laws
applicable to or binding on FSB, or as Owner Trustee, or contravene the
provisions of, or constitute a default under, its charter documents or
by-laws or, to our knowledge after due inquiry, any indenture, mortgage
contract or other agreement or instrument to which FSB or Owner Trustee
is a party or by which it or any of its property may be bound or
affected.
7. The execution and delivery of the Operative Agreements by each of FSB
and the Owner Trustee and the performance by each of FSB and the Owner
Trustee of their respective obligations thereunder does not require on
or prior to the date hereof the consent or approval of, the giving of
notice to, the registration or filing with, or the taking of any action
in respect of any Governmental Authority or any court.
8. Assuming that the trust created by the Trust Agreement is treated as
a grantor trust for federal income tax purposes within the contemplation
of Section 671 through 678 of the Internal Revenue Code of 1986, there
are no fees, taxes, or other charges (except taxes imposed on fees
payable to the Owner Trustee) payable to the State of Utah or any
political subdivision thereof in connection with the execution, delivery
or performance by the Owner Trustee, the Administrative Agent, the
Lenders, Georgia Gulf Corporation or the Holder, as the case may be, of
the Operative Agreements or in connection with the acquisition of any
Facility by the Owner Trustee or in connection with the making by the
Holder of its investment in the Trust or its acquisition of the
beneficial interest in the Trust Estate or in connection with the
issuance and acquisition of the Certificate, or the Notes, and neither
the Owner Trustee, the Trust Estate nor the trust created by the Trust
Agreement will be subject to any fee, tax or other governmental charge
(except taxes on fees payable to the Owner Trustee) under the laws of
the State of Utah or any political subdivision thereof on, based on
or measured by, directly or indirectly, the gross receipts, net income
or value of the Trust Estate by reason of the creation or continued
existence of the trust under the terms of the Trust Agreement pursuant
to the laws of the State of Utah or the Owner Trustee's performance of
its duties under the Trust Agreement.
9. There is no fee, tax or other governmental charge under the laws of
the State of Utah or any political subdivision thereof in existence on
the date hereof on, based on or measured by any return of Holder Amounts
under the Certificates, Notes or the beneficial interests in the Trust
Estate, by reason of the creation of the trust under the Trust Agreement
pursuant to the laws of the State of Utah or the Owner Trustee's
performance of its duties under the Trust Agreement within the State of
Utah.
10. Upon the filing of the financing statement on form UCC-1 in the form
attached hereto as Exhibit A with the Secretary of State of the State of
Utah, the security interest of the Administrative Agent, for the benefit
of the Lenders, and of the Holder, will be perfected, to the extent that
such perfection is governed by Article 9 of the Uniform Commercial Code
as in effect in the State of Utah (the "Utah UCC").
Your attention is directed to the Utah UCC, which provides, in part, that a
filed financing statement which does not state a maturity date or which
states a maturity date of more than five years is effective only for a period
of five years from the date of filing, unless within six months prior to the
expiration of said period a continuation statement is filed in the same
office or offices in which the original statement was filed. The
continuation statement must be signed by the secured party, identify the
original statement by file number and state that the original statement is
still effective. Upon the timely filing of a continuation statement, the
effectiveness of the original financing statement is continued for five years
after the last date to which the original statement was effective. Succeeding
continuation statements may be filed in the same manner to continue the
effectiveness of the original statement.
The opinions set forth in paragraphs 3 and 4 above are subject to the
qualification that enforceability of the Trust Agreement and the other
Operative Agreements to which the Owner Trustee is a party, in accordance
with their respective terms, may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting enforcement of
creditors' rights generally.
We are attorneys admitted to practice in the State of Utah and in rendering the
foregoing opinions we have not passed upon, or purported to pass upon, the laws
of any jurisdictions other than the State of Utah and the federal banking law
governing the banking and trust powers of FSB.
This opinion is for the sole benefit of Georgia Gulf Corporation, the
Administrative Agent, the Lenders, the Holder, FSB, not individually, but
solely as Owner Trustee under the GGC Trust 1996-1 and their respective
successors and assigns and may not be relied upon by any other person other
than such parties and their respective successors and assigns without the
express written consent of the undersigned. The opinions expressed herein
are as of the date hereof and we make no undertaking to amend or supplement
such opinions if facts come to our attention or changes in the current law of
the jurisdictions mentioned herein occur which could affect such opinions.
Very truly yours,
[Owner Trustee's Outside Counsel]
Distribution List
Georgia Gulf Corporation
First Security Bank of Utah, N.A., not individually, but solely as Owner
Trustee under the GGC Trust 1996-1
NationsBanc Leasing Corporation of North Carolina, as the Holder
ABN Amro Bank N.V., as a Lender
Bank of Montreal, as a Lender
The Bank of New York, as a Lender
The Bank of Nova Scotia, as a Lender
The Bank of Tokyo Trust Company, as a Lender
The Chase Manhattan Bank, N.A., as a Lender
The Dai-Ichi Kangyo Bank, Limited, Atlanta Agency, as a Lender
The Fuji Bank, Ltd., as a Lender
The Industrial Bank of Japan, Limited, as a Lender
The Sakura Bank, Limited, Atlanta Agency, as a Lender
Rabobank Nederland, New York Branch, as a Lender
The Tokai Bank, Limited, Atlanta Agency, as a Lender
Wachovia Bank of Georgia, N.A., as a Lender
NationsBank, N.A. (South), as the Administrative Agent
EXHIBIT A
Form of Lender UCC Filings
EXHIBIT I
Description of Material Litigation
None
EXHIBIT J
[Form of Ground Lease]
(Pursuant to Section 5.3(e) of the Participation Agreement)
EXHIBIT K
[Form of Mortgage]
(Pursuant to Section 5.3(l) of the Participation Agreement)
EXHIBIT L
[Form of Memorandum of Ground Lease]
(Pursuant to Section 5.3(o) of the Participation Agreement)
Schedule 1
Redemption of Holder Amount
Percentage of Holder
Date Amount to be Redeemed
Schedule 2
Repayment of Loans
Percentage of Loan
Date to be Repaid
Schedule 3
Changes in Incorporated Representations and Warranties
None
Appendix A
Rules of Usage and Definitions
I. Rules of Usage
The following rules of usage shall apply to this Appendix A and the
Operative Agreements (and each appendix, schedule, exhibit and annex to the
foregoing) unless otherwise required by the context or unless otherwise
defined therein:
(a) Except as otherwise expressly provided, any definitions set
forth herein or in any other document shall be equally applicable to the
singular and plural forms of the terms defined.
(b) Except as otherwise expressly provided, references in any
document to articles, sections, paragraphs, clauses, annexes, appendices,
schedules or exhibits are references to articles, sections, paragraphs,
clauses, annexes, appendices, schedules or exhibits in or to such
document.
(c) The headings, subheadings and table of contents used in any
document are solely for convenience of reference and shall not
constitute a part of any such document nor shall they affect the meaning,
construction or effect of any provision thereof.
(d) References to any Person shall include such Person, its
successors and permitted assigns and transferees.
(e) Except as otherwise expressly provided, reference to any
agreement means such agreement as amended, modified, extended,
supplemented, restated and/or replaced from time to time in accordance
with the applicable provisions thereof.
(f) Except as otherwise expressly provided, references to any law
includes any amendment or modification to such law and any rules or
regulations issued thereunder or any law enacted in substitution or
replacement therefor.
(g) When used in any document, words such as "hereunder", "hereto",
"hereof" and "herein" and other words of like import shall, unless the
context clearly indicates to the contrary, refer to the whole of the
applicable document and not to any particular article, section,
subsection, paragraph or clause thereof.
(h) References to "including" means including without limiting the
generality of any description preceding such term and for purposes hereof
the rule of ejusdem generis shall not be applicable to limit a general
statement, followed by or referable to an enumeration of specific
matters, to matters similar to those specifically mentioned.
(i) Each of the parties to the Operative Agreements and their
counsel have reviewed and revised, or requested revisions to, the
Operative Agreements, and the usual rule of construction that any
ambiguities are to be resolved against the drafting party shall
be inapplicable in the construing and interpretation of the Operative
Agreements and any amendments or exhibits thereto.
(j) Capitalized terms used in any Operative Agreements which are not
defined in this Appendix A but are defined in another Operative Agreement
shall have the meaning so ascribed to such term in the applicable
Operative Agreement.
II. Definitions
"ABR" shall mean, for any day, a rate per annum equal to the greater of
(a) the Prime Lending Rate in effect on such day, and (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. For purposes hereof:
"Prime Lending Rate" shall mean the rate which the Administrative Agent
announces from time to time as its prime lending rate as in effect from time to
time. The Prime Lending Rate is a reference rate and does not necessarily
represent the lowest or best rate actually charged to any customer. Any
Lender may make commercial loans or other loans at rates of interest at,
above or below the Prime Lending Rate. The Prime Lending Rate shall change
automatically and without notice from time to time as and when the prime
lending rate of the Administrative Agent changes. "Federal Funds Effective
Rate" shall mean, for any period, a fluctuating interest rate per annum equal
for each day during such period to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for such day (or, if
such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for
any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by it. Any change in the ABR
due to a change in the Prime Lending Rate or the Federal Funds Effective Rate
shall be effective as of the opening of business on the effective day of
such change in the Prime Lending Rate or the Federal Funds Effective Rate,
respectively.
"ABR Holder Funding" shall mean a Holder Funding bearing a Holder Yield
based on the ABR.
"ABR Loans" shall mean Loans bearing interest based upon the ABR.
"Acceleration" shall have the meaning given to such term in Section 6 of
the Credit Agreement.
"acquire" or "purchase" shall mean, with respect to the Facility, the
acquisition or purchase of the Facility by the Lessor from any Person.
"Acquisition Funding" shall have the meaning given to such term in Section
5.3 of the Participation Agreement.
"Acquisition Loan" shall mean a Loan made in connection with an
Acquisition Funding.
"Additions" shall mean, with respect to the construction, renovations
and/or Modifications on the Land, all buildings, structures, Fixtures, and
other improvements of every kind existing at any time and from time to time
on or under the Land, together with any and all appurtenances to such
buildings, structures or improvements, including sidewalks, utility pipes,
conduits and lines, parking areas and roadways, and including all
Modifications and other additions to or changes in the Additions at any time,
including without limitation (a) any Additions existing as of the Closing Date
as such Additions may be referenced on the applicable Requisition and (b) any
Additions made subsequent to the Closing Date.
"Administrative Agent" shall mean NationsBank, N.A. (South), a national
banking association, in its capacity as administrative agent for the Lenders.
"Affiliate" shall mean, with respect to any Person, any Person or group
acting in concert in respect of the Person in question that, directly or
indirectly, controls or is controlled by or is under common control with such
Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlled by" and "under common control
with") shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of management and policies of a Person, whether
through the ownership of voting securities or by contract or otherwise.
"After Tax Basis" shall mean, with respect to any payment to be received,
the amount of such payment increased so that, after deduction of the amount of
all taxes required to be paid by the recipient calculated at the then maximum
marginal rates generally applicable to Persons of the same type as the
recipients (less any tax savings realized as a result of the payment of the
indemnified amount) with respect to the receipt by the recipient of such
amounts, such increased payment (as so reduced) is equal to the payment
otherwise required to be made.
"Agency Agreement" shall mean the Agency Agreement, dated as of the
Initial Closing Date between the Construction Agent and the Lessor.
"Agency Agreement Event of Default" shall mean an "Event of Default" as
defined in Section 5.1 of the Agency Agreement.
"Agent" or "Administrative Agent" shall mean NationsBank, N.A. (South),
a national banking association, as administrative agent for the Lenders
pursuant to the Credit Agreement, or any successor agent appointed in
accordance with the terms of the Credit Agreement.
"Applicable Percentage" shall mean with respect to the applicable Funded
Debt Ratio, the applicable rate per annum set forth opposite such Funded Debt
Ratio:
Funded Debt Ratio Applicable Percentage Applicable Applicable
for Percentage Percentage
Eurodollar Loans for Lender for Holder
Unused Fee Unused Fee
Less than or equal
to 0.75 to 1.00 .425% .100% .100%
Greater than 0.75 to
1.00 and less than or
equal to 2.00 to 1.00 .475% .125% .125%
Greater than 2.00 to 1.00 .700% .250% .250%
Changes in the Applicable Percentage resulting from changes in the Funded Debt
Ratio shall become effective on the date on which financial statements and a
compliance certificate evidencing the same are delivered to the
Administrative Agent and the Holder and shall remain in effect until financial
statements and a compliance certificate evidencing a different Funded Debt
Ratio are delivered to the Administrative Agent and the Holder; provided, to
the extent any such financial statements and/or compliance certificates are
not delivered to the Administrative Agent and the Holder on a date required
for such delivery under the Operative Agreements, then the largest Applicable
Percentage shall apply until the date the appropriate financial statements
and/or compliance certificates are delivered; provided, further, until the
effectiveness of any change in the Applicable Percentage based upon a Funded
Debt Ratio announced after the Initial Closing, the smallest Applicable
Percentage shall apply.
"Appraisal" shall mean, with respect to the Facility, an appraisal to be
delivered in connection with the Participation Agreement or in accordance with
the terms of the Lease, in each case prepared by a reputable appraiser selected
by the Administrative Agent and the Holder, which in the judgment of counsel to
the Administrative Agent, complies with all of the provisions of the Financial
Institutions Reform, Recovery and Enforcement Act of 1989, as amended, the
rules and regulations adopted pursuant thereto, and all other applicable
Legal Requirements.
"Appraisal Procedure" shall have the meaning given such term in Section
22.4 of the Lease.
"Approved State" means Louisiana.
"Approved Turbine" shall mean each GE 7EA combustion turbine and
associated air cooled generator or other combustion turbine and associated
air cooled generator, in all cases reasonably acceptable to the
Administrative Agent, each Lender and the Holder and satisfying the
requirements of Section 10.3(h) of the Participation Agreement.
"Appurtenant Rights" shall mean (i) all agreements, easements, rights of
way or use, rights of ingress or egress, privileges, appurtenances, tenements,
hereditaments and other rights and benefits at any time belonging or pertaining
to the Land underlying the Additions, including, without limitation, the use of
any streets, ways, alleys, vaults or strips of land adjoining, abutting,
adjacent or contiguous to the Land and (ii) all permits, licenses and rights,
whether or not of record, appurtenant to such Land or the Additions.
"Assignment and Acceptance" shall mean the Assignment and Acceptance in
the form attached to the Credit Agreement as Exhibit B.
"Available Commitment" shall mean, as to any Lender at any time, an amount
equal to the excess, if any, of (a) the amount of such Lender's Commitment over
(b) the aggregate principal amount of all Loans made by such Lender as of such
date after giving effect to Section 5.2(d) of the Participation Agreement (but
without giving effect to any repayments or prepayments of any Loans hereunder).
"Available Holder Commitment" shall mean an amount equal to the excess, if
any, of (i) the amount of the Holder Commitment over (ii) the aggregate amount
of the Holder Fundings made since the Initial Closing Date after giving effect
to Section 5.2(d) of the Participation Agreement (but without giving effect to
any other returns of any Holder Fundings).
"Bankruptcy Code" shall mean Title 11 of the U. S. Code entitled
"Bankruptcy," as now or hereafter in effect or any successor thereto.
"Basic Rent" shall mean, the sum of (i) the Loan Basic Rent and (ii) the
Lessor Basic Rent, calculated as of the applicable date on which Basic Rent is
due.
"Basic Term" shall have the meaning specified in Section 2.2 of the Lease.
"Basic Term Commencement Date" shall have the meaning specified in Section
2.2 of the Lease.
"Basic Term Expiration Date" shall have the meaning specified in Section
2.2 of the Lease.
"Bill of Sale" shall mean a Bill of Sale regarding Equipment in form and
substance satisfactory to the Holder, the Administrative Agent and the Owner
Trustee.
"Board" shall mean the Board of Governors of the Federal Reserve System
of the United States (or any successor).
"Borrowing Date" shall mean any Business Day specified in a notice
delivered pursuant to Section 2.3 of the Credit Agreement as a date on which
the Lessor requests the Lenders to make Loans hereunder.
"Budgeted Total Facility Cost" shall mean, at any date of determination,
an amount equal to the aggregate amount which the Construction Agent in good
faith expects to be expended in order to achieve Completion of the Facility
(including amounts expected to be expended to pay interest on the Loans and
Holder Yield on the Holder Fundings).
"Business Day" shall mean a day other than a Saturday, Sunday or other
day on which commercial banks in Dallas, Texas, Atlanta, Georgia or Charlotte,
North Carolina are authorized or required by law to close; provided, however,
that when used in connection with a Eurodollar Loan, the term "Business Day"
shall also exclude any day on which banks are not open for dealings in dollar
deposits in the London interbank market.
"Capitalized Lease" shall mean, as applied to any Person, any lease of
property (whether real, personal, tangible, intangible or mixed of such
Person) by such Person as lessee which would be capitalized on a balance
sheet of such Person prepared in accordance with GAAP.
"Cash Flow" shall mean, for any period, the sum (without duplication),
determined on a consolidated basis for the Construction Agent or the Lessee,
as the case may be, and its Subsidiaries, of (i) net operating income of the
Construction Agent or the Lessee, as the case may be, and its Subsidiaries
(calculated before provision for income taxes, interest expense,
extraordinary items and income attributable to equity in Affiliates) for such
period plus (ii) depreciation, amortization and other non-cash items (to the
extent deducted in determining operating income) for such period plus (iii)
accrued interest income (to the extent not included in determining operating
income) for such period.
"Casualty" shall mean any damage or destruction of all or any portion of
the Facility as a result of a fire or other casualty.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, 42 U.S.C. Sections 9601 et seq., as
amended by the Superfund Amendments and Reauthorization Act of 1986.
"Certificate" shall mean the Certificate in favor of the Holder regarding
the Holder Commitment of the Holder issued pursuant to the terms and conditions
of the Trust Agreement.
"Claims" shall mean any and all obligations, liabilities, losses, actions,
suits, penalties, claims, demands, costs and expenses (including, without
limitation, reasonable attorney's fees and expenses) of any nature whatsoever.
"Closing Date" shall mean the Initial Closing Date and the Facility
Closing Date.
"Code" shall mean the Internal Revenue Code of 1986, together with the
rules and regulationspromulgated thereunder, as amended from time to time, or
any successor statute thereto.
"Collateral" shall mean all assets of the Lessor, now owned or hereafter
acquired, upon which a lien is purported to be created by the Security
Documents.
"Commitment" shall mean, as to any Lender, the obligation of such Lender
to make the portion of the Loans to the Lessor in an aggregate principal amount
at any time outstanding not to exceed the amount set forth opposite such
Lender's name on Schedule 1.1 of the Credit Agreement, as such amount may be
reduced from time to time in accordance with the provisions of the Credit
Agreement.
"Commitment Percentage" shall mean, as to any Lender at any time, the
percentage which such Lender's Commitment then constitutes of the aggregate
Commitments (or, at any time after the Commitments shall have expired or
terminated, the percentage which the aggregate principal amount of such
Lender's Loans then outstanding constitutes of the aggregate principal amount
of all of the Loans then outstanding).
"Commitment Period" shall mean the period from and including the Initial
Closing Date to and including the Construction Period Termination Date, or
such earlier date as the Commitments shall terminate as provided in the
Credit Agreement.
"Completion" shall mean such time as final completion of the acquisition,
installation and testing of the Equipment and the final completion of the
construction and testing of the Additions, in each case respecting the
Facility, has been achieved in accordance with the Plans and Specifications
and the GE Construction Contract, the Agency Agreement and/or the Lease, and
in compliance with all material Legal Requirements and Insurance Requirements
and a certificate of completion has been issued with respect to the Facility
by General Electric in form and substance satisfactory to the Administrative
Agent and the Holder.
"Completion Date" shall mean, the earlier of (i) the date on which
Completion of the Facility has occurred or (ii) February 6, 1998, which date
may be extended for up to an additional six months thereafter, to the extent
Completion is delayed because of a Force Majeure Event.
"Condemnation" shall mean any taking or sale of the use, access,
occupancy, easement rights or title to the Facility or any part thereof,
wholly or partially (temporarily or permanently), by or on account of any
actual or threatened eminent domain proceeding or other taking of action by any
Person having the power of eminent domain, including an action by a
Governmental Authority to change the grade of, or widen the streets adjacent
to, the Facility or alter the pedestrian or vehicular traffic flow to the
Facility so as to result in a change in access to the Facility, or by or on
account of an eviction by paramount title or any transfer made in lieu of any
such proceeding or action.
"Construction Agent" shall mean Georgia Gulf Corporation, a Delaware
corporation, as construction agent under the Agency Agreement.
"Construction Budget" shall mean the cost of acquiring, installing and
testing the Equipment and constructing and developing the Additions as
determined by the Construction Agent in its reasonable, good faith judgment.
"Construction Commencement Date" shall mean the date on which the
acquisition of Equipment or the construction of the Additions (whichever is
earlier) commences pursuant to the Agency Agreement.
"Construction Contract" shall mean any contract entered into between the
Construction Agent or the Lessee with a Contractor for the construction of
Additions or any portion thereof on the Facility, including the GE Construction
Contract.
"Construction Funding" shall mean a funding to pay Facility Costs pursuant
to Section 5.4 of the Participation Agreement.
"Construction Loan" shall mean any Loan made in connection with a
Construction Funding.
"Construction Period" shall mean the period commencing on the Construction
Commencement Date and ending on the Completion Date.
"Construction Period Termination Date" shall mean the earlier of (i) the
date that the Commitments have been terminated in their entirety in accordance
with the terms of Section 2.5(a) of the Credit Agreement, or (ii) the second
anniversary of the Initial Closing Date.
"Contingent Obligation" shall mean, as applied to any Person, any
agreement, undertaking or arrangement by which such Person assumes,
guarantees, endorses, contingently agrees to purchase or provide funds for
the payment of, or otherwise becomes or is contingently liable upon, the
obligation or liability of any other Person or agrees to maintain the net
worth or working capital or other financial condition of any other Person, or
otherwise assures any creditor of such other Person against loss, including,
without limitation, any comfort letter, operating agreement, take-or-pay
contract or application for a letter of credit (or similar instrument which
is issued upon the application of such Person or upon which such Person
becomes an account party or for which such Person is in any way liable),
but excluding the endorsement of instruments for deposit or collection in the
ordinary course of business.
"Contingent Rent" shall mean amounts from time to time payable by Lessee
equal to amounts then due and owing by the Owner Trustee under the Swap
Agreement.
"Contract Collateral" shall have the meaning given to such term in the
Contract Collateral Assignment.
"Contract Collateral Assignment" shall mean the Assignment and Security
Agreement dated as of the Initial Closing Date from Georgia Gulf Corporation,
as grantor, in favor of the Owner Trustee, as secured party thereunder.
"Contract Collateral Financing Statements" shall mean UCC financing
statements and fixture filings appropriately completed and executed for
filing in the applicable jurisdictions in order to protect the Owner
Trustee's interest under the Contract Collateral Assignment.
"Contractor" shall mean each entity with whom the Construction Agent or
the Lessee contracts to acquire or install any Equipment, construct any
Additions or any portion thereof on the Facility or otherwise perform
services respecting the Facility.
"Control" shall mean (including the correlative meanings of the terms
"controlled by" and "under common control with"), as used with respect to any
Person, the possession directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person, whether
through the ownership of voting securities or by contract or otherwise.
"Controlled Group" shall mean all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with Lessee, are treated as a single employer
under Section 414 of the Code.
"Co-Owner Trustee" shall have the meaning specified in Section 9.2 of the
Trust Agreement.
"Credit Agreement" shall mean the Credit Agreement, dated as of the Initial
Closing Date, among the Lessor, the Administrative Agent and the Lenders, as
specified therein.
"Credit Agreement Default" shall mean any event or condition which, with
the lapse of time or the giving of notice, or both, would constitute a Credit
Agreement Event of Default.
"Credit Agreement Event of Default" shall mean any event or condition
defined as an "Event of Default" in Section 6 of the Credit Agreement.
"Credit Documents" shall mean the Credit Agreement, the Notes and the
Security Documents.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" shall have the meaning given to such term in Section
9.1 of the Credit Agreement.
"Dollars" and "$" shall mean dollars in lawful currency of the United
States of America.
"Election Notice" shall have the meaning given to such term in Section
20.1 of the Lease.
"Employee Benefit Plan" or "Plan" shall mean an employee benefit plan
(within the meaning of Section 3(3) of ERISA, including any Multiemployer
Plan), or any "plan" as defined in Section 4975(e)(1) of the Code and as
interpreted by the Internal Revenue Service and the Department of Labor in
rules, regulations, releases or bulletins in effect on any Closing Date.
"Environmental Claims" shall mean any investigation, notice, violation,
demand, allegation, action, suit, injunction, judgment, order, consent
decree, penalty, fine, lien, proceeding, or claim (whether administrative,
judicial, or private in nature) arising (a) pursuant to, or in connection with,
an actual or alleged violation of, any Environmental Law, (b) in connection
with any Hazardous Substance, (c) from any abatement, removal, remedial,
corrective, or other response action in connection with a Hazardous
Substance, Environmental Law, or other order of a Tribunal or (d) from any
actual or alleged damage, injury, threat, or harm to health, safety, natural
resources, or the environment.
"Environmental Laws" shall mean any Law, permit, consent, approval,
license, award, or other authorization or requirement of any Tribunal
relating to emissions, discharges, releases, threatened releases of any
Hazardous Substance into ambient air, surface water, ground water, publicly
owned treatment works, septic system, or land, or otherwise relating to the
handling, storage, treatment, generation, use, or disposal of Hazardous
Substances, pollution or to the protection of health or the environment,
including without limitation CERCLA, the Resource Conservation and Recovery
Act, 42 U.S.C. Section 6901, et seq., and state statutes analogous thereto.
"Environmental Violation" shall mean any activity, occurrence or condition
that violates or threatens (if the threat requires remediation under any
Environmental Law and is not remediated during any grace period allowed
under such Environmental Law) to violate or results in or threatens (if the
threat requires remediation under any Environmental Law and is not remediated
during any grace period allowed under such Environmental Law) to result in
noncompliance with any Environmental Law.
"Equipment" shall mean equipment, apparatus, furnishings, fittings and
personal property of every kind and nature whatsoever purchased, leased or
otherwise acquired using the proceeds of the Loans or the Holder Fundings by
the Construction Agent, the Lessee or the Lessor as specified or described in
either a Requisition or the Lease Supplement, whether or not now or subsequently
attached to, contained in or used or usable in any way in connection with any
operation of any Additions or other improvements to real property, including
but without limiting the generality of the foregoing, all equipment described
in the Appraisal including, without limitation, all cogeneration, heating,
electrical, and mechanical equipment, lighting, switchboards, plumbing,
ventilation, air conditioning and air-cooling apparatus, refrigerating, and
incinerating equipment, escalators, elevators, loading and unloading
equipment and systems, cleaning systems (including window cleaning apparatus),
telephones, communication systems (including satellite dishes and antennae),
televisions, computers, sprinkler systems and other fire prevention and
extinguishing apparatus and materials, security systems, motors, engines,
machinery, pipes, pumps, tanks, conduits, appliances, fittings and fixtures
of every kind and description.
"Equipment Schedule" shall mean (a) each Equipment Schedule attached to
the applicable Requisition and (b) the Equipment Schedule attached to the
Lease Supplement.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"ERISA Affiliate" shall mean each entity required to be aggregated with
any Lessee pursuant to the requirements of Section 414(b) or (c) of the Code.
"Eurocurrency Reserve Requirements" shall mean for any day as applied to
a Eurodollar Loan, the aggregate (without duplication) of the maximum rates
(expressed as a decimal fraction) of reserve requirements in effect on such
day (including, without limitation, basic, supplemental, marginal and
emergency reserves under any regulations of the Board or other Governmental
Authority having jurisdiction with respect thereto) dealing with reserve
requirements prescribed for eurocurrency funding (currently referred to as
"Eurocurrency liabilities" in Regulation D) maintained by a member bank of
the Federal Reserve System.
"Eurodollar Holder Funding" shall mean a Holder Funding bearing a Holder
Yield based on the Eurodollar Rate.
"Eurodollar Loans" shall mean Loans bearing interest based upon the
Eurodollar Rate.
"Eurodollar Rate" shall mean for the Interest Period for each Eurodollar
Loan or Eurodollar Holder Funding comprising part of the same borrowing or
funding (including conversions, extensions and renewals), a per annum
interest rate equal to the per annum rate determined by the Administrative
Agent on the basis of the offered rates for deposits in dollars for a period
of time corresponding to such Interest Period (and commencing on the first
day of such Interest Period), which appear on the Reuters Screen LIBO Page as
of 11:00 a.m. (London time) two (2) Business Days before the first day of
such Interest Period (provided that, if at least two such offered rates
appear on the Reuters Screen LIBO Page, the rate in respect of such Interest
Period will be the arithmetic mean of such offered rates). As used herein,
"Reuters Screen LIBO Page" means the display designated as page "LIBO"
on the Reuters Monitor Money Rates Service (or such other page as may replace
the LIBO page on that service for the purpose of displaying London interbank
offered rates of major banks).
"Event of Default" shall mean a Lease Event of Default, an Agency
Agreement Event of Default or a Credit Agreement Event of Default.
"Excess Proceeds" shall mean the excess, if any, of the aggregate of all
awards, compensation or insurance proceeds payable in connection with a
Casualty or Condemnation over the Termination Value paid by the Lessee
pursuant to the Lease with respect to such Casualty or Condemnation.
"Excluded Property" shall mean any Approved Turbine and any portion of,
and any building, structure or other improvement located on, the Land that is
the site of a water treatment plant or similar facility (and not a part of
the Facility); provided, the value, utility, economic life and operation of
the Facility is not materially impaired due to (i) the existence of such
plant or facility or (ii) the exclusion of such plant or facility (or the
operational benefits thereof) from the Facility.
"Expiration Date" shall mean either (a) the Basic Term Expiration Date,
(b) to the extent there is a first Renewal Term and Lessee elects in
accordance with the terms and provisions of Article XX of the Lease the
Purchase Option or the Sale Option at the end of such first Renewal Term,
then the Expiration Date shall be the fourth annual anniversary of the Basic
Term Commencement Date or (c) to the extent there is a second Renewal Term and
Lessee elects in accordance with the terms and provisions of Article XX of the
Lease the Purchase Option or the Sale Option at the end of such second Renewal
Term, then the Expiration Date shall be the fifth annual anniversary of the
Basic Term Commencement Date; provided, in no event shall the Expiration Date
be later than February 6, 2003 unless such later date has been expressly
agreed to in writing by each of Lessor, Lessee, the Agent, the Lenders and
the Holder.
"Expiration Date Purchase Option" shall mean the Lessee's option to
purchase all (but not less than all) of the Facility on the Expiration Date.
"Facility" shall mean the 250 megawatt cogeneration facility to be located
on the Land subject to the Ground Lease that is (or is to be) acquired,
installed, constructed and/or renovated pursuant to the terms of the
Operative Agreements, including without limitation all components of the power
production plant and the switchyard (in each case located on the Land), the
Land subject to the Ground Lease, each item of Equipment and the Additions,
prior to and subsequent to the commencement of the Basic Term other than the
Excluded Property.
"Facility Closing Date" shall mean the date on which the Lessor initially
acquires an interest in the Facility, but in no event later than March 31,
1996.
"Facility Cost" shall mean the aggregate amount of the Loan Facility Cost,
plus the Holder Facility Cost (as such amounts shall be increased respecting
the Holder Fundings and the Loans extended from time to time to pay for the
Transaction Expenses, fees, expenses and other disbursements referenced in
Sections 9.1(a) and (b) of the Participation Agreement).
"Fair Market Sales Value" shall mean, with respect to the Facility, the
amount, which in any event, shall not be less than zero, that would be paid
in cash in an arms-length transaction between an informed and willing
purchaser and an informed and willing seller, neither of whom is under any
compulsion to purchase or sell, respectively, the Facility. Fair Market
Sales Value of the Facility shall be determined based on the assumption that,
except for purposes of Section 17 of the Lease, the Facility is in the
condition and state of repair required under Section 10.1 of the Lease and
the Lessee is in compliance with the other requirements of the Operative
Agreements.
"Federal Funds Effective Rate" shall have the meaning given to such term
in the definition of ABR.
"Fitch" shall mean Fitch Investors Service, Inc.
"Fixtures" shall mean all fixtures relating to the Additions, including
all components thereof, located in or on the Additions, together with all
replacements, modifications, alterations and additions thereto.
"Force Majeure Event" shall mean any event beyond the control of the
Construction Agent, other than a Casualty or Condemnation, including, but
not limited to, strikes, lockouts, adverse soil conditions, acts of God,
adverse weather conditions, inability to obtain labor or materials,
governmental activities, civil commotion and enemy action; but excluding any
event, cause or condition that results from the Construction Agent's financial
condition.
"Funded Debt" shall mean, as to any Person (determined without
duplication): (i) indebtedness of such Person for borrowed money (whether by
loan or the issuance and sale of debt securities) or for the deferred
purchase or acquisition price of property or services, other than accounts
payable (other than for borrowed money) incurred in the ordinary course of
business; (ii) obligations of such Person in respect of letter of credit or
similar instruments issued or accepted by banks and other financial
institutions for the account of such Person; (iii) obligations under
Capitalized Leases of such Person; (iv) obligations of such Person to redeem
or otherwise retire shares of capital stock of such Person or, in the case of
the Construction Agent or the Lessee, as the case may be, any such obligation
to redeem or retire shares of capital stock of the Construction Agent or the
Lessee, as the case may be, prior to November 15, 2000 (other than any such
obligation the payment of which would constitute a Restricted Payment
permitted by Section 9.13 of the GGC Credit Agreement); (v) indebtedness of
others of the type described in clause (i), (ii), (iii) or (iv) above secured
by a Lien on the property of such Person, whether or not the respective
obligation so secured has been assumed by such Person; (vi) indebtedness of
others of the type described in clause (i), (ii), (iii) or (iv) above
Guaranteed by such Person and (vii) deferred insurance premiums.
"Funded Debt Ratio" shall mean, as of any date of determination thereof,
the ratio of Funded Debt to Cash Flow.
"Funding" shall mean a Construction Funding or an Acquisition Funding and
shall include the Loans and the Holder Fundings.
"GAAP" shall mean generally accepted accounting principles set forth in
the opinions and pronouncements of the accounting principles board of the
American Institute of Certified Public Accountants, and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession, that are applicable to the circumstances as of the
date of determination.
"GE Construction Contract" shall mean, collectively, the Agreement dated
as of October 17, 1995 between Georgia Gulf Corporation and General Electric
providing for the construction of the electrical substation and the Agreement
dated as of October 17, 1995 between Georgia Gulf Corporation and General
Electric providing for the construction of the cogeneration system, in each
case as supplemented by the Turnkey Scope Documents for the Design,
Engineering, Procurement, Construction and Start-Up of the Cogeneration Plant
at Placquemine, as produced in October 1995.
"GGC Credit Agreement" shall have the meaning given to such term in
Section 28.1 of the Lease.
"GGC Credit Agreement Event of Default" shall mean an event of default
under the GGC Credit Agreement.
"GGC Trust 1996-1" shall mean the grantor trust created pursuant to the
terms and conditions of the Trust Agreement.
"General Electric" shall mean General Electric Company, a New York
corporation.
"Georgia Gulf Corporation" shall mean Georgia Gulf Corporation, a Delaware
corporation.
"Governmental Action" shall mean all permits, authorizations,
registrations, consents, approvals, waivers, exceptions, variances, orders,
judgments, written interpretations, decrees, licenses, exemptions,
publications, filings, notices to and declarations of or with, or required
by, any Governmental Authority, or required by any Legal Requirement, and
shall include, without limitation, all environmental and operating permits
and licenses that are required for the full use, occupancy, zoning,
construction, operation and maintenance of the Facility.
"Governmental Authority" shall mean any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Ground Lease" shall mean a ground lease of the Land (in form and
substance satisfactory to the Administrative Agent and the Holder) from the
Lessee to the Lessor having a 40 year term and annual rent set at $1.00 per
year, or such other terms and conditions as are satisfactory to the
Administrative Agent and the Holder.
"Guaranty" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Funded Debt of any other
Person and, without limiting the generality of the foregoing, any obligation,
direct or indirect, contingent or otherwise, of such Person (i) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Funded Debt (whether arising by virtue of partnership arrangements, by
agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise,
other than arrangements to purchase goods at an arms's length price in the
ordinary course of business) or (ii) entered into for the purpose of assuring
in any other manner the holder of such Funded Debt of the payment thereof or
to protect such holder against loss in respect thereof (in whole or in part),
provided that the term Guaranty shall not include endorsements for collection
or deposit in the ordinary course of business. The term "Guarantee" used as a
verb has a corresponding meaning.
"Hard Costs" shall mean all costs and expenses payable for supplies,
materials, labor and profit with respect to the Additions under any
Construction Contract.
"Hazardous Substance" shall mean any of the following: (i) any petroleum
or petroleum product, explosives, radioactive materials, asbestos,
formaldehyde, polychlorinated biphenyls, lead and radon gas; (ii) any
substance, material, product, derivative, compound or mixture, mineral,
chemical, waste, gas, medical waste, or pollutant, in each case whether
naturally occurring, man-made or the by-product of any process, that is
toxic, harmful or hazardous to the environment or human health or safety as
determined in accordance with any Environmental Law; or (iii) any substance,
material, product, derivative, compound or mixture, mineral, chemical, waste,
gas, medical waste or pollutant that would support the assertion of any claim
under any Environmental Law, whether or not defined as hazardous as such under
any Environmental Law.
"Hazardous Substances Facility" shall mean a facility used for the
treatment, storage or disposal of Hazardous Substances.
"Holder" shall mean NationsBanc Leasing Corporation of North Carolina, a
North Carolina corporation, as the holder of the Certificate in connection
with the GGC Trust 1996-1.
"Holder Amount" shall mean as of any date, the aggregate amount of Holder
Fundings made by the Holder to the Owner Trustee pursuant to Section 2 of the
Participation Agreement and Section 3.1 of the Trust Agreement less any return
of any Holder Fundings received by the Holder pursuant to Section 3.4 of the
Trust Agreement.
"Holder Applicable Margin" shall mean one percent (1.00%).
"Holder Collateral" shall have the meaning given to such term in Section 2
of the Security Agreement.
"Holder Commitment" shall mean $18,000,000.
"Holder Excepted Amounts" shall mean: (a) all indemnity payments
(including indemnity payments made pursuant to Section 13 of the
Participation Agreement), whether made by adjustment to Basic Rent or
otherwise, to which the Owner Trustee, the Holder or any of their respective
Affiliates, agents, officers, directors or employees is entitled;
(b) any payments (other than Basic Rent or Termination Value) payable
under any Operative Agreement to reimburse the Owner Trustee, the Holder or
any of their respective Affiliates (including the reasonable expenses of the
Owner Trustee, the Trust Company and the Holder incurred in connection with
any such payment) for performing or complying with any of the obligations of
the Lessee under and as permitted by any Operative Agreement;
(c) any amount payable to the Holder by any transferee of such interest
of the Holder as the purchase price of the Holder's interest in the Trust
Estate (or a portion thereof);
(d) any insurance proceeds (or payments with respect to risks self-
insured or policy deductibles) under liability policies other than such
proceeds or payments payable to the Administrative Agent or any Lender;
(e) any insurance proceeds under policies maintained by the Owner Trustee
or the Holder;
(f) Transaction Expenses or other amounts or expenses paid or payable to
or for the benefit of the Owner Trustee or the Holder;
(g) all right, title and interest of the Holder or the Owner Trustee to
the Facility or any portion thereof or any other property to the extent any of
the foregoing has been released from the Liens of the Security Documents and
the Lease pursuant to the terms thereof;
(h) upon termination of the Credit Agreement pursuant to the terms
thereof, all remaining property covered by the Lease or Security Documents;
(i) all payments in respect of the Holder Yield;
(j) any payments in respect of interest or yield to the extent
attributable to payments or other amounts referred to in clauses (a) through
(i) above; and
(k) any rights of either the Owner Trustee or Trust Company to demand,
collect, sue for or otherwise receive and enforce payment or return of any of
the foregoing amounts, provided that such rights shall not include the right
to terminate the Lease.
"Holder Excepted Rights" shall mean the rights retained by the Owner
Trustee pursuant to Section 8.2(a) of the Credit Agreement.
"Holder Facility Cost" shall mean with respect to the Facility an amount
equal to the outstanding Holder Fundings with respect thereto.
"Holder Funding" shall mean any funding made by the Holder to the Owner
Trustee pursuant to the terms of the Trust Agreement or the Participation
Agreement.
"Holder Overdue Yield" shall mean the lesser of (i) the ABR plus two
percent (2%) and (ii) the highest rate permitted by applicable law.
"Holder Participation Fee" shall have the meaning given to such term in
Section 9.5 of the Participation Agreement.
"Holder Unused Fee" shall have the meaning given to such term in Section
9.4 of the Participation Agreement.
"Holder Yield" shall mean with respect to Holder Fundings from time to
time either the Eurodollar Rate plus the Holder Applicable Margin or the ABR
as elected by the Owner Trustee from time to time with respect to such Holder
Fundings in accordance with the terms of the Trust Agreement; provided,
however, (i) upon delivery of the notice described in Section 3.7(c) of the
Trust Agreement, the Holder Fundings of the Holder shall bear a yield at the
ABR applicable from time to time from and after the dates and during the
periods specified in Section 3.7(c) of the Trust Agreement, and (ii) upon the
delivery by the Holder of the notice described in Section 3.9(e) of the Trust
Agreement, the Holder Fundings of the Holder shall bear a yield at the ABR
applicable from time to time after the dates and during the periods specified
in Section 3.9(e) of the Trust Agreement.
"Impositions" shall mean any and all liabilities, losses, expenses, costs,
charges and Liens of any kind whatsoever for fees, taxes, levies, imposts,
duties, charges, assessments or foreign withholdings ("Taxes") and all
interest, additions to tax and penalties thereon, which at any time prior to,
during or with respect to the Term or in respect of any period for which the
Lessee shall be obligated to pay Supplemental Rent, may be levied, assessed
or imposed by any Governmental Authority upon or with respect to (a) the
Facility or the leasing, financing, refinancing, demolition, construction,
substitution, subleasing, assignment, control, condition, occupancy,
servicing, maintenance, repair, ownership, possession, activity conducted on,
delivery, insuring, use, operation, improvement, sale, transfer of title,
return or other disposition of the Facility or any part thereof or interest
therein or any rentals, receipts or earnings arising therefrom; (b) any Swap
Agreement, the Notes or Certificates or any part thereof or interest therein;
or (c) the Operative Agreements, the performance thereof, or any payment made
or accrued pursuant thereto or otherwise in connection with the transactions
contemplated thereby.
"Incorporated Covenants" shall have the meaning given to such term in
Section 28.1 of the Lease.
"Incorporated Representations and Warranties" shall have the meaning given
to such term in Section 28.1 of the Lease.
"Indebtedness" of a Person shall mean, without duplication, such Person's:
(i) obligations for borrowed money;
(ii) obligations representing the deferred purchase price of the
Facility (whether real, personal, tangible, intangible or mixed) or
services (other than accounts payable arising in the ordinary course of
such Person's business payable on terms customary in the trade);
(iii) obligations, whether or not assumed, secured by liens or
payable out of the proceeds or production from property now or hereafter
owned or acquired by such Person;
(iv) obligations which are evidenced by notes, acceptances or other
instruments;
(v) all obligations under Capitalized Leases;
(vi) net liabilities under interest rate swap, exchange or cap
agreements; and
(vii) Contingent Obligations.
"Indemnified Person" shall mean the Lessor, the Owner Trustee, in its
individual and its trust capacity, the Administrative Agent, the Holder, the
Lenders, and their respective successors, assigns, directors, shareholders,
partners, officers, employees, agents and Affiliates.
"Indemnity Provider" shall mean the Construction Agent from the date of
the Participation Agreement to and including the Basic Term Commencement Date
and the Lessee for the duration of the Term for the Facility.
"Initial Closing Date" shall mean the date of the Participation Agreement.
"Initial Construction Funding" shall mean the initial Funding to fund the
Facility Costs for the acquisition and/or installation of any Equipment and the
construction of any Additions.
"Inspector" shall mean any Person engaged by the Administrative Agent to
oversee the monitoring of the progress of any Additions and reviewing of
Requisitions and to provide related services relating to administration of
such Additions during the Construction Period.
"Insurance Requirements" shall mean all terms and conditions of any
insurance policy either required by the Lease to be maintained by the Lessee
or required by the Agency Agreement to be maintained by the Construction
Agent, and all requirements of the issuer of any such policy and, regarding
self insurance, any other requirements of Lessee.
"Interest Payment Loan" shall mean any Loan made to fund the payment of
interest on any Loan with respect to the Facility prior to the Basic Term
Commencement Date.
"Interest Period" shall mean (a) as to any Eurodollar Loan or Eurodollar
Holder Funding (i) with respect to the initial Interest Period, the period
beginning on the date of such Eurodollar Loan or Eurodollar Holder Funding,
as the case may be, extended pursuant to the terms of Section 2.1 of the
Credit Agreement and ending one month, two months or three months thereafter,
as selected by the Lessor (in the case of a Eurodollar Loan) or the Owner
Trustee (in the case of a Eurodollar Holder Funding) in its applicable
notice given with respect thereto; and (ii) thereafter, each period
commencing on the last day of the next preceding Interest Period applicable to
such Eurodollar Loan or Eurodollar Holder Funding and ending one month, two
months or three months thereafter, as selected by the Lessor by irrevocable
notice to Administrative Agent (in the case of a Eurodollar Loan) or by the
Owner Trustee (in the case of a Eurodollar Holder Funding) in each case not
less than three Business Days prior to the last day of the then current
Interest Period with respect thereto; provided, however, that all of the
foregoing provisions relating to Interest Periods are subject to the
following: (A) if any Interest Period would end on a day which is not a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day (except that where the next succeeding Business Day falls in the
next succeeding calendar month, then on the next preceding Business Day),
(B) no Interest Period shall extend beyond the Maturity Date or the
Expiration Date, as the case may be, (C) where an Interest Period begins on
a day for which there is no numerically corresponding day in the calendar
month in which the Interest Period is to end, such Interest Period shall end
on the last Business Day of such calendar month and (D) during the period
from and after the Commitment Period, there shall not be more than four (4)
Interest Periods outstanding at any one time.
"Investment Company Act" shall mean the Investment Company Act of 1940, as
amended, together with the rules and regulations promulgated thereunder.
"IRS" shall mean the United States Internal Revenue Service, or any
successor or analogous organization.
"Land" shall mean the parcel of real property subject to the Ground Lease
and described on (a) the Requisition issued by the Construction Agent on the
Facility Closing Date relating to such parcel and (b) the schedules to the
Lease Supplement executed and delivered in accordance with the requirements
of Section 2.4 of the Lease.
"Law" shall mean any statute, law, ordinance, regulation, rule, directive,
order, writ, injunction or decree of any Tribunal.
"Lease" or "Lease Agreement" shall mean the Lease Agreement (Tax Retention
Operating Lease) dated as of the Initial Closing Date, between the Lessor and
the Lessee, together with the Lease Supplement thereto, as such Lease Agreement
may from time to time be supplemented, amended or modified in accordance with
the terms thereof.
"Lease Default" shall mean any event or condition which, with the lapse of
time or the giving of notice, or both, would constitute a Lease Event of
Default.
"Lease Event of Default" shall have the meaning specified in Section 17.1
of the Lease.
"Lease Supplement" shall mean the Lease Supplement substantially in the
form of Exhibit A to the Lease, together with all attachments and schedules
thereto.
"Legal Requirements" shall mean all foreign, federal, state, county,
municipal and other governmental statutes, laws, rules, orders, regulations,
ordinances, judgments, awards, decrees and injunctions affecting the Owner
Trustee, the Holder, the Lessor, the Lessee, the Administrative Agent, any
Lender or the Facility, the Land, any Addition, any Equipment or the taxation,
demolition, construction, use or alteration of such Additions, whether now or
hereafter enacted and in force, including any that require repairs,
modifications or alterations in or to the Facility or in any way limit the
use and enjoyment thereof (including all building, zoning and fire codes and
the Americans with Disabilities Act of 1990, 42 U.S.C. Section 12101 et. seq.,
and any other similar federal, state or local laws or ordinances and the
regulations promulgated thereunder) and any that may relate to environmental
requirements (including all Environmental Laws), and all permits, certificates
of occupancy, licenses, authorizations and regulations relating thereto, and
all covenants, agreements, restrictions and encumbrances contained in any
instruments which are either of record or known to the Lessee affecting the
Facility or the Appurtenant Rights.
"Lender Collateral" shall have the meaning given to such term in Section 2
of the Security Agreement.
"Lender Commitments" shall mean the commitment of each Lender as set forth
in Schedule 1.1 to the Credit Agreement, as such Schedule 1.1 may be amended
and replaced from time to time.
"Lender Excepted Payments" shall mean: (a) all indemnity payments
(including indemnity payments made pursuant to Section 13 of the
Participation Agreement), whether made by adjustment to Basic Rent or
otherwise, to which the Lenders, the Administrative Agent or any of their
respective Affiliates, agents, officers, directors or employees is entitled;
(b) any amounts (other than Basic Rent or Termination Value) payable
under any Operative Agreement to reimburse the Lenders, the Administrative
Agent or any of their respective Affiliates (including the reasonable
expenses of the Lenders and the Administrative Agent incurred in connection
with any such payment) for performing or complying with any of the
obligations of the Lessee under and as permitted by any Operative Agreement;
(c) any amount payable to the Lenders or the Administrative Agent by any
transferee of such interest of such person as the purchase price of its
interest in the Lender Collateral or its Loans (or a portion thereof);
(d) any insurance proceeds (or payments with respect to risks self-
insured or policy deductibles) under liability policies payable to the
Administrative Agent or any Lender;
(e) any insurance proceeds under policies maintained by the Lenders or
the Administrative Agent;
(f) Transaction Expenses or other amounts or expenses paid or payable to
or for the benefit of the Lenders or the Administrative Agent;
(g) all payments in respect of the Loans and the Notes;
(h) any payments in respect of interest to the extent attributable to
payments referred to in clauses (a) through (g) above.
"Lender Excepted Rights" shall mean the rights of either the Lenders or
the Administrative Agent to demand, collect, sue for or otherwise receive
and enforce payment of the Lender Excepted Payments.
"Lender Financing Statements" shall mean UCC financing statements and
fixture filings appropriately completed and executed for filing in the
applicable jurisdiction in order to procure a security interest in favor of
the Administrative Agent and the Holder in any Equipment or in any Additions.
"Lender Participation Fee" shall have the meaning given to such term in
Section 9.5 of the Participation Agreement.
"Lender" or "Lenders" shall mean each of the several banks and other
financial institutions from time to time party to the Credit Agreement and
also including the Holder for purposes of any matter requiring unanimous
consent of the Lenders or any matter requiring the consent of each Lender;
provided, notwithstanding the foregoing, with respect to any matter where the
Holder has (separate and apart from the Lenders) an independent vote or right
of consent, then with respect to such matter the Holder shall not be deemed a
Lender.
"Lender Unused Fee" shall have the meaning given to such term in Section
9.4 of the Participation Agreement.
"Lessee" shall have the meaning set forth in the Lease.
"Lessee Scheduled Termination Date" shall mean the final day of the Term
as specified in the final Election Notice (which shall be a Payment Date or
the Expiration Date) after the Basic Term has commenced for the Facility and
on which date Lessee shall purchase all, but not less than all, of the
Facility pursuant to the Purchase Option or cause all, but not less than all,
of the Facility to be sold pursuant to the Sale Option.
"Lessor" shall mean the Owner Trustee, not in its individual capacity, but
as Lessor under the Lease.
"Lessor Basic Rent" shall mean the scheduled return of Holder Amount on
any date specified therefor in Schedule 1 to the Participation Agreement and
the scheduled Holder Yield due on the Holder Amount on any Scheduled Interest
Payment Date pursuant to the Trust Agreement (but not including interest on
(i) any such scheduled Holder Yield due on the Holder Amount prior to the Basic
Term Commencement Date or (ii) overdue amounts under the Trust Agreement or
otherwise).
"Lessor Financing Statements" shall mean UCC financing statements and
fixture filings appropriately completed and executed for filing in the
applicable jurisdictions in order to protect the Lessor's interest under the
Lease to the extent the Lease is a security agreement or a mortgage.
"Lessor Lien" shall mean any Lien, true lease or sublease or disposition of
title arising as a result of (a) any claim against the Lessor or Trust Company,
in its individual capacity, not resulting from the transactions contemplated by
the Operative Agreements, (b) any act or omission of the Lessor or Trust
Company, in its individual capacity, which is not required by the Operative
Agreements or is in violation of any of the terms of the Operative Agreements,
(c) any claim against the Lessor or Trust Company, in its individual capacity,
with respect to Taxes or Transaction Expenses against which the Lessee is not
required to indemnify Lessor or Trust Company, in its individual capacity,
pursuant to Section 13 of the Participation Agreement or (d) any claim against
the Lessor arising out of any transfer by the Lessor of all or any portion of
the interest of the Lessor in the Facility, the Trust Estate or the Operative
Agreements other than the transfer of title to or possession of the Facility
by the Lessor pursuant to and in accordance with the Lease, the Credit
Agreement, the Security Agreement or the Participation Agreement or pursuant
to the exercise of the remedies set forth in Article XVII of the Lease.
"Letter of Credit" shall mean that certain irrevocable standby letter of
credit issued pursuant to the terms and conditions of the GE Construction
Contract in favor of the Owner Trustee.
"Lien" shall mean any mortgage, pledge, security interest, encumbrance,
lien, option or charge of any kind.
"Limited Recourse Amount" shall mean an amount equal to the sum of the
Termination Value on each Payment Date, less the Maximum Residual Guarantee
Amount as of such date.
"Limited Termination Value" means the sum of (a) the product of (i) an
amount equal to the aggregate outstanding Facility Cost for the Facility, in
each case as of the last occurring Payment Date, multiplied by (ii) .89999,
plus (b) respecting the aggregate outstanding Facility Cost for the Facility,
any and all accrued interest on the Loans and any and all Holder Yield on the
Holder Fundings related to the Facility Cost, plus (c) all other Rent and
other amounts then due and payable or accrued under the Agency Agreement,
Lease and/or under any other Operative Agreement.
"Loans" shall have the meaning given to such term in Section 2.1(a) in the
Credit Agreement.
"Loan Basic Rent" shall mean the scheduled repayment of Loan amounts on
any date specified therefor in Schedule 2 to the Participation Agreement and
the interest due on the Loans on any Scheduled Interest Payment Date pursuant
to the Credit Agreement (but not including interest on (i) any such Loan
prior to the Basic Term Commencement Date or (ii) any overdue amounts under
Section 2.8(b) of the Credit Agreement or otherwise).
"Loan Facility Cost" shall mean, with respect to the Facility at any date
of determination, an amount equal to (a) the aggregate principal amount of all
Loans (including without limitation all Acquisition Loans, Construction Loans
and Interest Payment Loans) made on or prior to such date with respect to the
Facility minus (b) the aggregate amount of prepayments or repayments as the
case may be of the Loans allocated to reduce the Loan Facility Cost of the
Facility pursuant to Section 2.6(c) of the Credit Agreement.
"Majority Lenders" shall mean at any time, Lenders whose Loans outstanding
represent at least 58% of the aggregate Loans outstanding. For purposes of
determining "Majority Lenders", the Holder shall be deemed a Lender and the
Holder Fundings shall be deemed Loans, except in connection with any actions
to be taken or omitted to be taken by the Administrative Agent or the Lenders
in respect of the Lender Collateral.
"Marketing Period" shall mean, if the Lessee has given a Sale Notice in
accordance with Section 20.1 of the Lease, the period commencing on the date
such Sale Notice is given and ending on the Expiration Date.
"Material Adverse Effect" shall, mean a material adverse effect on (a) the
business, condition (financial or otherwise), assets, liabilities or operations
of the Lessee and its Subsidiaries taken as a whole, (b) the ability of the
Lessee or any Subsidiary to substantially perform its respective obligations
under any Operative Agreement to which it is a party, (c) the validity or
enforceability of any Operative Agreement or the rights and remedies of the
Administrative Agent, the Lenders, the Holder, or the Lessor thereunder, (d)
the validity, priority or enforceability of any Lien on the Facility created
by any of the Operative Agreements, or (e) the value, utility or useful life of
the Facility or the use, or ability of the applicable Lessee to use, the
Facility for the purpose for which it was intended as of the Initial Closing
Date.
"Material Subsidiary" means any Subsidiary of Lessee which either (a) has
assets which constitute 10% or more of the consolidated assets of Lessee and
its Subsidiaries or (b) has revenues during its most recently-ended fiscal
year which constitute more than 10% of the consolidated revenues of Lessee
and its Subsidiaries during the most recently-ended fiscal year of Lessee.
"Maturity Date" shall mean the same date as the Expiration Date.
"Maximum Residual Guarantee Amount" shall mean an amount equal to the
product of the Facility Cost for the Facility times
(a) if the Expiration Date is the Basic Term Expiration Date, 76.7080519%
(b) if the Expiration Date is the first annual anniversary of the Basic
Term Expiration Date, 74.9828495%; and
(c) if the Expiration Date is the second annual anniversary of the Basic
Term Expiration Date, 70.9554394%;
but in no event less than the aggregate outstanding principal balance of the
Loans as of such Expiration Date. On or prior to the Basic Term Commencement
Date, the percentages set forth above in this definition of "Maximum Residual
Guarantee Amount" shall be revised pursuant to the terms and provisions of
Section 5.7 of the Participation Agreement.
"Modifications" shall have the meaning specified in Section 11.1(a) of the
Lease.
"Moody's" shall mean Moody's Investors Service, Inc.
"Mortgage Instrument" shall mean any mortgage, deed of trust or any other
instrument executed by the Owner Trustee and the Lessee in favor of the
Holder (for the benefit of itself and the Administrative Agent) and
evidencing a Lien on the Facility, in form and substance reasonably
acceptable to the Holder and the Administrative Agent.
"Multiemployer Plan" shall mean any plan described in Section 4001(a)(3)
of ERISA to which contributions are or have been made or required by the
Lessee or any of its Subsidiaries or ERISA Affiliates.
"Multiple Employer Plan" shall mean a plan to which the Lessee or any
ERISA Affiliate and at least one other employer other than an ERISA Affiliate
is making or accruing an obligation to make, or has made or accrued an
obligation to make, contributions.
"Net Proceeds" shall mean all amounts paid in connection with any Casualty
or Condemnation, and all interest earned thereon, less the expense of claiming
and collecting such amounts, including all costs and expenses in connection
therewith for which the Administrative Agent or Lessor are entitled to be
reimbursed pursuant to the Lease.
"Net Sale Proceeds Shortfall" shall mean the amount by which the proceeds
of a sale described in Section 22.1 of the Lease (net of all expenses of sale)
are less than the Limited Recourse Amount with respect to the Facility if it
has been determined that the Fair Market Sales Value of the Facility at the
expiration of the term of the Lease has been impaired by greater than
expected wear and tear during the Term of the Lease.
"New Facility" shall have the meaning specified in Section 28.1 of the
Lease.
"Non-Excluded Taxes" shall have the meaning given to such term in Section
2.13 of the Credit Agreement.
"Notes" shall mean those notes issued to the Lenders pursuant to the
Credit Agreement.
"Occupational Safety and Health Law" shall mean the Occupational Safety
and Health Act of 1970 and any other federal, state or local statute, law,
ordinance, code, rule, regulation, order or decree regulating or relating to,
or imposing liability or standards of conduct concerning, employee health
and/or safety, as now or at any time hereafter in effect.
"Officer's Certificate" with respect to any person shall mean a
certificate executed on behalf of such person by a Responsible Officer who
has made or caused to be made such examination or investigation as is
necessary to enable such Responsible Officer to express an informed opinion
with respect to the subject matter of such Officer's Certificate.
"Operative Agreements" shall mean the following: the Participation
Agreement, the Agency Agreement, the Trust Agreement (and an extract thereof
in a form reasonably acceptable to the Administrative Agent and the Holder),
the Certificates, the Credit Agreement, the Notes, the Lease (and a
memorandum thereof in a form reasonably acceptable to the Administrative Agent
and the Holder), the Lease Supplement (and a memorandum thereof in a form
reasonably acceptable to the Administrative Agent and the Holder), the
Ground Lease (and a memorandum thereof in a form reasonably acceptable to the
Administrative Agent and the Holder), any Bills of Sale, the Security
Agreement, the Mortgage Instrument, the Contract Collateral Assignment, the
Letter of Credit and the GE Construction Contract.
"Overdue Interest" shall mean any interest payable pursuant to Section
2.8(b) of the Credit Agreement.
"Overdue Rate" shall mean (i) with respect to Basic Rent, and any other
amount owed under or with respect to the Credit Agreement or the Security
Documents, the rate specified in Section 2.8(b) of the Credit Agreement,
(ii) with respect to Lessor Basic Rent, the Holder Yield and any other
amount owed under or with respect to the Trust Agreement, the applicable
rate specified in the Trust Agreement, and (iii) with respect to any other
amount, the amount referred to in clause (y) of Section 2.8(b) of the Credit
Agreement.
"Owner Trustee," "Borrower" or "Lessor" shall mean First Security Bank of
Utah, N.A., not individually, except as expressly stated in the various
Operative Agreements, but solely as Owner Trustee under the GGC Trust 1996-1,
and any successor or replacement Owner Trustee expressly permitted under the
Operative Agreements, including without limitation Mr. Val T. Orton pursuant
to the terms and provisions of Section 14.17 of the Participation Agreement.
"Owner Trustee Advisor" shall mean First Security Bank of Utah, N.A., in
its capacity as advisor to Mr. Val T. Orton, solely to the extent that he is
deemed to be the Owner Trustee pursuant to the terms and provisions of
Section 14.17 of the Participation Agreement, and any successor or
replacement Owner Trustee Advisor expressly permitted under the Operative
Agreements.
"Participant" shall have the meaning given to such term in Section 9.7 of
the Credit Agreement.
"Participation Agreement" shall mean the Participation Agreement dated as
of the Initial Closing Date, among the Lessee, the Owner Trustee, not in its
individual capacity except as expressly stated therein, the Holder, the
Lenders and the Administrative Agent, as such Participation Agreement may be
amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof or of any other Operative Agreement.
"Participation Fee" shall mean, collectively, the Holder Participation Fee
and the Lender Participation Fee.
"Payment Date" shall mean any Scheduled Interest Payment Date and any date
on which interest or Holder Yield in connection with a prepayment of principal
on the Loans or a redemption of the Holder Fundings is due under the Credit
Agreement or the Trust Agreement.
"PBGC" shall mean the Pension Benefit Guaranty Corporation created by
Section 4002(a) of ERISA or any successor thereto.
"Permitted Exceptions" shall mean:
(i) Liens of the types described in clauses (i), (ii) and (v)
of the definition of Permitted Liens;
(ii) Liens for Taxes not yet due; and
(iii) all encumbrances, exceptions, restrictions, easements,
rights of way, servitudes, encroachments and irregularities in title,
other than Liens which, in the reasonable assessment of the
Administrative Agent, do not materially impair the use of the Facility for
its intended purpose.
"Permitted Liens" shall mean:
(i) the respective rights and interests of the parties to the
Operative Agreements as provided in the Operative Agreements;
(ii) the rights of any sublessee or assignee under a sublease or
an assignment expressly permitted by the terms of the Lease;
(iii) Liens for Taxes that either are not yet due or are being
contested in accordance with the provisions of Section 13.1 of the Lease;
(iv) Liens arising by operation of law, materialmen's,
mechanics', workmen's, repairmen's, employees', carriers',
warehousemen's and other like Liens relating to the construction of the
Additions or in connection with any Modifications or arising in the
ordinary course of business for amounts that either are not more than
30 days past due or are being diligently contested in good faith by
appropriate proceedings, so long as such proceedings satisfy the
conditions for the continuation of proceedings to contest Taxes set
forth in Section 13.1 of the Lease;
(v) Liens of any of the types referred to in clause (iv) above
that have been bonded for not less than the full amount in dispute (or as
to which other security arrangements satisfactory to the Lessor and the
Administrative Agent have been made), which bonding (or arrangements)
shall comply with applicable Legal Requirements, and shall have
effectively stayed any execution or enforcement of such Liens;
(vi) Liens arising out of judgments or awards with respect to
which appeals or other proceedings for review are being prosecuted in
good faith and for the payment of which adequate reserves have been
provided as required by GAAP or other appropriate provisions have been
made, so long as such proceedings have the effect of staying the
execution of such judgments or awards and satisfy the conditions for
the continuation of proceedings to contest Taxes set forth in Section
13.1 of the Lease;
(vii) Liens in favor of municipalities to the extent agreed to by
the Lessor;
and
(viii) Permitted Exceptions.
"Pension Plan" shall mean a "pension plan", as such term is defined in
section 3(2) of ERISA, which is subject to title IV of ERISA (other than a
Multiemployer Plan), and to which the Lessee or any ERISA Affiliate may have
any liability, including any liability by reason of having been a substantial
employer within the meaning of section 4063 of ERISA at any time during the
preceding five (5) years, or by reason of being deemed to be a contributing
sponsor under section 4069 of ERISA.
"Person" shall mean any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated
organization, governmental authority or any other entity.
"Plans and Specifications" shall mean, with respect to Additions, the
plans and specifications for such Additions to be constructed or already
existing, as set forth in the Construction Contracts, as such Plans and
Specifications may be amended, modified or supplemented from time to time in
accordance with the terms of the Participation Agreement.
"Prime Lending Rate" shall have the meaning given to such term in the
definition of ABR.
"Purchase Option" shall have the meaning given to such term in Section
20.1 of the Lease.
"Purchasing Lender" shall have the meaning given to such term in Section
9.8(a) of the Credit Agreement.
"Qualifying Facility" shall mean a cogeneration facility that has
satisfied the definition set forth in 18 C.F.R. Section 292.,201 et seq.,
promulgated under the Public Utility Regulatory Policies Act of 1978, as the
same may be amended, modified, extended, supplemented, restated and/or replaced
from time to time.
"Rating Agencies" shall mean Moody's, S&P and Fitch or, in each case, any
successor nationally recognized statistical rating organization.
"Register" shall have the meaning given to such term in Section 9.9(a) of
the Credit Agreement.
"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System (or any successor), as the same may be modified and
supplemented and in effect from time to time.
"Release" shall mean any release, pumping, pouring, emptying, injecting,
escaping, leaching, dumping, seepage, spill, leek, flow, discharge, disposal or
emission of a Hazardous Substance.
"Relevant Collateral" shall have the meaning given to such term in Section
1 of the Security Agreement.
"Relevant Collateral Agent" shall have the meaning given to such term in
Section 1 of the Security Agreement.
"Renewal Term" shall have the meaning specified in Section 2.2 of the
Lease.
"Rent" shall mean, collectively, the Basic Rent and the Supplemental Rent,
in each case payable under the Lease.
"Reportable Event" shall have the meaning specified in ERISA.
"Requested Funds" shall mean any funds requested by the Lessee or the
Construction Agent, as applicable, in accordance with Section 5 of the
Participation Agreement.
"Requirement of Law" shall mean, as to any Person, the Certificate of
Incorporation and By-laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject.
"Requisition" shall have the meaning specified in Section 4.2 of the
Participation Agreement.
"Responsible Officer" shall mean the Chairman or Vice Chairman of the
Board of Directors, the Chairman or Vice Chairman of the Executive Committee
of the Board of Directors, the President, any Senior Vice President or
Executive Vice President, any Vice President, the Controller, the Secretary,
any Assistant Secretary, the Treasurer, or any Assistant Treasurer, except that
when used with respect to the Trust Company or the Owner Trustee,
"Responsible Officer" shall also include the Cashier, any Assistant Cashier,
any Trust Officer or Assistant Trust Officer, the Controller and any
Assistant Controller or any other officer of the Trust Company or the Owner
Trustee customarily performing functions similar to those performed by any of
the above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Restricted Payment" shall mean dividends (in cash, property or
obligations) on, or other payments or distributions on account of, or the
setting apart of money for a sinking or other analogous fund for the
purchase, redemption, retirement or other acquisition of, any shares of any
class of capital stock of the Construction Agent or the Lessee, as the case
may be, or the exchange or conversion of any shares of any class of capital
stock of the Construction Agent or the Lessee, as the case may be, for or
into any obligations of or shares of any other class of capital stock of the
Construction Agent or the Lessee, as the case may be, or any other property,
but excluding dividends payable solely in, or exchanges or conversions for or
into, shares of common stock of the Construction Agent or the Lessee, as the
case may be.
"S&P" shall mean Standard and Poors Rating Group, a division of McGraw
Hill, Inc.
"Sale Date" shall have the meaning given to such term in Section 22.1(a)
of the Lease.
"Sale Notice" shall mean a notice given to Lessor in connection with the
election by Lessee of its Sale Option.
"Sale Option" shall have the meaning given to such term in Section 20.1 of
the Lease.
"Scheduled Interest Payment Date" shall mean (i) as to any Eurodollar Loan
or Eurodollar Holder Funding, the last day of the Interest Period applicable to
such Eurodollar Loan or Eurodollar Holder Funding, (ii) as to any ABR Loan or
any ABR Holder Funding, the fifteenth day of each month and (iii) as to all
Loans and Holder Fundings, the date of any voluntary or involuntary payment,
prepayment, return or redemption, and the Maturity Date or the Expiration
Date, as the case may be.
"Securities Act" shall mean the Securities Act of 1933, as amended,
together with the rules and regulations promulgated thereunder.
"Security Agreement" shall mean the Security Agreement dated as of the
Initial Closing Date among the Lessor, the Holder and the Administrative
Agent, for the benefit of the Lenders.
"Security Documents" shall mean the collective reference to the Security
Agreement, the Mortgage Instruments, and all other security documents hereafter
delivered to the Administrative Agent or the Holder granting a lien on any
asset or assets of any Person to secure the obligations and liabilities of
the Lessor under the Credit Agreement and/or under any of the other Credit
Documents or the Trust Agreement or to secure any guarantee of any such
obligations and liabilities.
"Soft Costs" shall mean all costs related to the development and
construction of the Facility other than Hard Costs, including without
limitation fees and expenses related to appraisals, title examinations,
title insurance, surveys, environmental site assessments, geotechnical soil
investigations and similar costs, the Lender Unused Fee, the Holder Unused Fee,
the Lender Participation Fee, the Holder Participation Fee, fees and expenses
of the Owner Trustee payable or reimbursable under the Operative Agreements
and costs and expenses incurred pursuant to Sections 9.3 (i) and (ii).
"Subsidiary" shall mean, as to any Person, any corporation of which at
least a majority of the outstanding stock having by the terms thereof
ordinary voting power to elect a majority of the board of directors of such
corporation (irrespective of whether or not at the time stock of any other
class or classes of such corporation shall have or might have voting power
by reason of the happening of any contingency) is at the time owned by such
Person, or by one or more Subsidiaries, or by such Person and one or more
Subsidiaries.
"Supplemental Rent" shall mean all amounts, liabilities and obligations
(other than Basic Rent) which the Lessee assumes or agrees to pay or return
amounts to Lessor, the Trust Company, the Holder, the Administrative Agent,
the Lenders or any other Person under the Lease or under any of the other
Operative Agreements including, without limitation, payments of Contingent
Rent, the Termination Value and the Maximum Residual Guarantee Amount and
all indemnification amounts, liabilities and obligations.
"Swap Agreement" shall mean an interest rate protection agreement or any
other hedging arrangement between the Owner Trustee and a Swap Counterparty.
"Swap Counterparty" shall mean one or more financial institutions
reasonably acceptable to the Majority Lenders.
"Taxes" shall have the meaning specified in the definition of Impositions.
"Term" shall mean the Basic Term and each Renewal Term (if any).
"Termination Date" shall have the meaning specified in Section 16.2(a) of
the Lease.
"Termination Event" shall mean (a) with respect to any Pension Plan, the
occurrence of a Reportable Event or an event described in Section 4062(e) of
ERISA, (b) the withdrawal of the Lessee or any ERISA Affiliate from a
Multiple Employer Plan during a plan year in which it was a substantial
employer (as such term is defined in Section 4001(a)(2) of ERISA), or the
termination of a Multiple Employer Plan, (c) the distribution of a notice of
intent to terminate a Plan or Multiemployer Plan pursuant to Section
4041(a)(2) or 4041A of ERISA, (d) the institution of proceedings to
terminate a Plan or Multiemployer Plan by the PBGC under Section 4042 of ERISA,
(e) any other event or condition which might constitute grounds under Section
4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan or Multiemployer Plan, or (f) the complete or partial
withdrawal of the Lessee or any ERISA Affiliate from a Multiemployer Plan.
"Termination Notice" shall have the meaning specified in Section 16.1 of
the Lease.
"Termination Value" shall mean the sum of (a) an amount equal to the
aggregate outstanding Facility Cost for the Facility, in each case as of the
last occurring Payment Date, plus (b) respecting the amounts described in the
foregoing subclause (a), any and all accrued interest on the Loans and any
and all Holder Yield on the Holder Fundings related to the Facility Cost,
plus (c) all other Rent and other amounts then due and payable or accrued
under the Agency Agreement, Lease and/or under any other Operative Agreement
(including without limitation all costs and expenses referred to in clause
FIRST of Section 22.2 of the Lease).
"Total Condemnation" shall mean a Condemnation that involves a taking of
Lessor's entire title to the Facility.
"Transaction Expenses" shall mean all Soft Costs and all other costs and
expenses incurred in connection with the preparation, execution and delivery of
the Operative Agreements and the transactions contemplated by the Operative
Agreements including without limitation:
(a) the reasonable fees, out-of-pocket expenses and disbursements of
counsel in negotiating the terms of the Operative Agreements and the other
transaction documents, negotiating (pursuant to Section 14.15 of the
Participation Agreement) the terms of the conversion (if any) of the
Transactions described in the Operative Agreements into a secured loan,
preparing for the closings under, and rendering opinions in connection
with, such transactions and in rendering other services customary for
counsel representing parties to transactions of the types involved in
the transactions contemplated by the Operative Agreements;
(b) the reasonable fees, out-of-pocket expenses and disbursements of
accountants for the Lessee or the Construction Agent in connection with
the transaction contemplated by the Operative Agreements;
(c) any and all other reasonable fees, charges or other amounts
payable to the Lenders, the Administrative Agent, the Holder, the Owner
Trustee or any broker which arises under any of the Operative Agreements;
(d) any other reasonable fee, out-of-pocket expenses, disbursement
or cost of any party to the Operative Agreements or any of the other
transaction documents; and
(e) any and all Taxes and fees incurred in recording or filing any
Operative Agreement or any other transaction document, any deed,
declaration, mortgage, security agreement, notice or financing statement
with any public office, registry or governmental agency in connection
with the transactions contemplated by the Operative Agreement.
"Tribunal" shall mean any state, commonwealth, federal, foreign,
territorial, or other court or government body, subdivision agency,
department, commission, board, bureau or instrumentality of a governmental
body.
"Trust Agreement" shall mean the Trust Agreement dated as of the Initial
Closing Date between the Holder and the Owner Trustee.
"Trust Company" shall mean First Security Bank of Utah, N.A. in its
individual capacity, and any successor owner trustee under the Trust
Agreement in its individual capacity.
"Trust Estate" shall have the meaning specified in Section 2.2 of the
Trust Agreement.
"Type" shall mean, as to any Loan, whether it is an ABR Loan or a
Eurodollar Loan.
"UCC Financing Statements" shall mean collectively the Lender Financing
Statements and the Lessor Financing Statements.
"Unanimous Vote Matters" shall have the meaning given it in Section
10.2(j) of the Participation Agreement.
"Unfunded Liability" shall mean, with respect to any Plan, at any time,
the amount (if any) by which (a) the present value of all benefits under such
Plan exceeds (b) the fair market value of all Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plan, but only to the extent that such excess represents a potential
liability of the Company or any member of the Controlled Group to the PBGC or
such Plan under Title IV of ERISA.
"Uniform Commercial Code" and "UCC" shall mean the Uniform Commercial Code
as in effect in any applicable jurisdiction.
"United States Bankruptcy Code" shall mean Title 11 of the United States
Code.
"Unused Fee" shall mean, collectively, the Holder Unused Fee and the
Lender Unused Fee.
"Unused Fee Payment Date" shall mean the last day of each January, April,
July and October and the last day of the Commitment Period, or such earlier
date as the Commitments shall terminate as provided in the Credit Agreement
or the Holder Commitment shall terminate as provided in the Trust Agreement.
"Voting Power" shall mean, with respect to securities issued by any
Person, the combined voting power of all securities of such person which are
issued and outstanding at the time of determination and which are entitled to
vote in the election of directors of such Person, other than securities
having such power only by reason of the happening of a contingency.
"Withdrawal Liability" shall mean liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.
"Work" shall mean the furnishing of labor, materials, components,
furniture, furnishings, fixtures, appliances, machinery, equipment, tools,
power, water, fuel, lubricants, supplies, goods and/or services with respect
to the Facility.
EXHIBIT 10(d)
LEASE AGREEMENT
(Tax Retention Operating Lease)
Dated as of February 6, 1996
between
FIRST SECURITY BANK OF UTAH, N.A.,
not individually,
but solely as Owner Trustee
under the GGC Trust 1996-1,
as Lessor
and
GEORGIA GULF CORPORATION,
as Lessee
This Lease Agreement is subject to a security interest in favor of NationsBank,
N.A. (South), as Administrative Agent (the "Administrative Agent") and
NationsBanc Leasing Corporation of North Carolina, as the holder (the
"Holder") under a Security Agreement dated as of February 6, 1996, among
First Security Bank of Utah, N.A., not individually except as expressly stated
therein, but solely as Owner Trustee under the GGC Trust 1996-1, the Holder and
the Administrative Agent, 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 Administrative Agent on the signature page hereof.
TABLE OF CONTENTS
ARTICLE I. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
1.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . .1
1.2 Interpretation. . . . . . . . . . . . . . . . . . . . . . .1
ARTICLE II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
2.1 Facility. . . . . . . . . . . . . . . . . . . . . . . . . .2
2.2 Lease Term. . . . . . . . . . . . . . . . . . . . . . . . .2
2.3 Title . . . . . . . . . . . . . . . . . . . . . . . . . . .2
2.4 Lease Supplement. . . . . . . . . . . . . . . . . . . . . .2
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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
4.1 Taxes; Utility Charges. . . . . . . . . . . . . . . . . . .4
ARTICLE V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
5.1 Quiet Enjoyment . . . . . . . . . . . . . . . . . . . . . .4
ARTICLE VI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
6.1 Net Lease . . . . . . . . . . . . . . . . . . . . . . . . .5
6.2 No Termination or Abatement . . . . . . . . . . . . . . . .5
ARTICLE VII. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
7.1 Ownership of the Facility . . . . . . . . . . . . . . . . .6
ARTICLE VIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
8.1 Condition of the Facility . . . . . . . . . . . . . . . . .7
8.2 Possession and Use of the Facility. . . . . . . . . . . . .7
8.3 Integrated Facility . . . . . . . . . . . . . . . . . . . .8
ARTICLE IX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
9.1 Compliance With Legal Requirements and Insurance
Requirements 9
ARTICLE X. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
10.1 Maintenance and Repair; Return. . . . . . . . . . . . . . .9
10.2 Environmental Inspection. . . . . . . . . . . . . . . . . 10
ARTICLE XI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
11.1 Modifications . . . . . . . . . . . . . . . . . . . . . . 11
11.2 Approved Turbines . . . . . . . . . . . . . . . . . . . . 11
ARTICLE XII. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
12.1 Warranty of Title . . . . . . . . . . . . . . . . . . . . 12
ARTICLE XIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
13.1 Permitted Contests Other Than in Respect of Indemnities . 12
ARTICLE XIV. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
14.1 Public Liability and Workers' Compensation Insurance. . . 13
14.2 Permanent Hazard and Other Insurance. . . . . . . . . . . 13
14.3 Coverage. . . . . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE XV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
15.1 Casualty and Condemnation . . . . . . . . . . . . . . . . 15
15.2 Environmental Matters . . . . . . . . . . . . . . . . . . 17
15.3 Notice of Environmental Matters . . . . . . . . . . . . . 18
ARTICLE XVI. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
16.1 Termination Upon Certain Events . . . . . . . . . . . . . 18
16.2 Procedures. . . . . . . . . . . . . . . . . . . . . . . . 18
ARTICLE XVII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
17.1 Lease Events of Default . . . . . . . . . . . . . . . . . 19
17.2 Surrender of Possession . . . . . . . . . . . . . . . . . 22
17.3 Reletting . . . . . . . . . . . . . . . . . . . . . . . . 22
17.4 Damages . . . . . . . . . . . . . . . . . . . . . . . . . 22
17.5 Power of Sale.. . . . . . . . . . . . . . . . . . . . . . 23
17.6 Final Liquidated Damages. . . . . . . . . . . . . . . . . 23
17.7 [Intentionally Omitted].. . . . . . . . . . . . . . . . . 24
17.8 Waiver of Certain Rights. . . . . . . . . . . . . . . . . 24
17.9 Assignment of Rights Under Contracts. . . . . . . . . . . 24
17.10 Remedies Cumulative . . . . . . . . . . . . . . . . . . . 24
ARTICLE XVIII. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
18.1 Lessor's Right to Cure Lessee's Lease Defaults. . . . . . 24
ARTICLE XIX. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
19.1 Provisions Relating to Lessee's Exercise of its
Purchase Option 24
19.2 No Purchase or Termination With Respect to Less than
All of the Facility 25
ARTICLE XX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
20.1 Purchase Option or Sale Option-General Provisions . . . . 25
20.2 Lessee Purchase Option. . . . . . . . . . . . . . . . . . 25
20.3 Third Party Sale Option . . . . . . . . . . . . . . . . . 26
ARTICLE XXI. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
21.1 [Intentionally Omitted] . . . . . . . . . . . . . . . . . 27
ARTICLE XXII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
22.1 Sale Procedure. . . . . . . . . . . . . . . . . . . . . . 27
22.2 Application of Proceeds of Sale . . . . . . . . . . . . . 29
22.3 Indemnity for Excessive Wear. . . . . . . . . . . . . . . 29
22.4 Appraisal Procedure . . . . . . . . . . . . . . . . . . . 29
22.5 Certain Obligations Continue. . . . . . . . . . . . . . . 30
ARTICLE XXIII. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
23.1 Holding Over. . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE XXIV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
24.1 Risk of Loss. . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE XXV. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
25.1 Assignment. . . . . . . . . . . . . . . . . . . . . . . . 31
25.2 Subleases . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE XXVI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
26.1 No Waiver . . . . . . . . . . . . . . . . . . . . . . . . 32
ARTICLE XXVII. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
27.1 Acceptance of Surrender . . . . . . . . . . . . . . . . . 32
27.2 No Merger of Title. . . . . . . . . . . . . . . . . . . . 32
ARTICLE XXVIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
28.1 Incorporation of Covenants. . . . . . . . . . . . . . . . 32
ARTICLE XXIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
29.1 Notices . . . . . . . . . . . . . . . . . . . . . . . . . 33
ARTICLE XXX. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
30.1 Miscellaneous . . . . . . . . . . . . . . . . . . . . . . 35
30.2 Amendments and Modifications. . . . . . . . . . . . . . . 35
30.3 Successors and Assigns. . . . . . . . . . . . . . . . . . 35
30.4 Headings and Table of Contents. . . . . . . . . . . . . . 35
30.5 Counterparts. . . . . . . . . . . . . . . . . . . . . . . 35
30.6 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . 35
30.7 Calculation of Rent . . . . . . . . . . . . . . . . . . . 35
30.8 Memoranda of Lease and Lease Supplement . . . . . . . . . 35
30.9 Allocations between the Lenders and the Holder. . . . . . 35
30.10 Limitations on Recourse . . . . . . . . . . . . . . . . . 36
30.11 WAIVERS OF JURY TRIAL . . . . . . . . . . . . . . . . . . 36
30.12 Acknowledgement of Security Agreement . . . . . . . . . . 36
30.13 Submission To Jurisdiction; Waivers . . . . . . . . . . . 36
30.14 USURY SAVINGS PROVISION . . . . . . . . . . . . . . . . . 37
EXHIBITS
EXHIBIT A - Lease Supplement No. ___
EXHIBIT B-1 - Memorandum of Lease and Lease Supplement No.___
EXHIBIT B-2 - Memorandum of Lease
LEASE AGREEMENT
(Tax Retention Operating Lease Agreement)
THIS LEASE AGREEMENT (Tax Retention Operating Lease) (as amended, modified,
extended, supplemented, restated and/or replaced from time to time in
accordance with the applicable provisions thereof, this "Lease"), dated as of
February 6, 1996, is between FIRST SECURITY BANK OF UTAH, N.A., a national
banking association, having its principal office at 79 South Main Street,
Salt Lake City, Utah 84111, not individually, but solely as Owner Trustee
under the GGC Trust 1996-1, as lessor (the "Lessor"), and GEORGIA GULF
CORPORATION, a Delaware corporation, having its principal place of business
at 400 Perimeter Center Terrace, Suite 595, Atlanta, Georgia 30346, as
lessee (the "Lessee").
W I T N E S E T H:
A. WHEREAS, subject to the terms and conditions of the Participation
Agreement and the Agency Agreement, Lessor will (i) ground lease the Land
from the Lessee, as ground lessor, pursuant to the Ground Lease and (ii)
fund the development, acquisition, installation, construction and testing by
the Construction Agent of the Equipment and the Additions on such Land; and
B. WHEREAS, the Basic Term shall commence with respect to the Facility
upon the earlier to occur of the Completion of the Facility or the date of any
Agency Agreement Event of Default; and
C. WHEREAS, Lessor desires to lease to Lessee, and Lessee desires to
lease from Lessor, the Facility;
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. Capitalized terms used but not otherwise defined in
this Lease have the respective meanings specified in Appendix A to the
Participation Agreement of even date herewith (as such may be amended,
modified, extended, supplemented, restated and/or replaced from time to time
in accordance with the applicable provisions thereof, the "Participation
Agreement") among the Lessee, the Construction Agent, First Security Bank of
Utah, N.A., not individually, except as expressly stated therein, as Owner
Trustee under the GGC Trust 1996-1, the Holder, the Lenders and the
Administrative Agent.
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 Facility. Subject to the terms and conditions hereinafter set forth
and contained in the Lease Supplement relating to the Facility, Lessor hereby
leases to Lessee and Lessee hereby leases from Lessor, the Facility.
2.2 Lease Term. The basic term of this Lease with respect to the
Facility (the "Basic Term") shall begin upon the earlier to occur of (i)
the Completion Date, (ii) the second annual anniversary of the Initial
Closing Date, or (iii) the date of any Agency Agreement Event of Default
(in each case the "Basic Term Commencement Date") and shall end on the third
annual anniversary of the Basic Term Commencement Date (the "Basic Term
Expiration Date"), unless the Basic Term is earlier terminated or the term
of this Lease is renewed (as described below) in accordance with the
provisions of this Lease.
To the extent no Default or Event of Default has occurred and is
continuing, and if Lessee has not provided written notice to the Lessor, the
Administrative Agent and the Holder at least 120 days prior to the first day
of the applicable Renewal Term of its determination to exercise its purchase
option or sale option under Article XX hereof, the term of this Lease shall
be automatically extended for one year following the Basic Term Expiration
Date, and if so renewed, thereafter for an additional one year period from
the one-year anniversary of the Basic Term Expiration Date (each, a "Renewal
Term"); provided, that the expiration date for the second Renewal Term shall
not be later than February 6, 2003 unless such later expiration date has been
expressly agreed to, at the request of the Lessee, in writing by each of
Lessor, the Agent, the Lenders and the Holder in their sole discretion;
and provided, further, that such date shall in no event extend beyond five
years after the end of the second Renewal Term.
2.3 Title. The Facility 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 Exceptions) and all applicable Legal
Requirements. Lessee shall in no event have any recourse against Lessor for
any defect in Lessor's title to the Facility or any interest of the Lessee
therein other than for Lessor Liens.
2.4 Lease Supplement. On or prior to the Basic Term Commencement Date,
Lessee and Lessor shall each execute and deliver the Lease Supplement in
substantially the form of Exhibit A hereto. Lessee hereby irrevocably
appoints Lessor as Lessee's attorney-in-fact, with power of substitution, in
the name of Lessor or the name of Lessee or otherwise, to execute the Lease
Supplement to the extent Lessee fails or refuses to sign in accordance with
the terms of this Section 2.4 (including specifically without limitation the
Lease Supplement required in connection with the Facility upon the occurrence
of an Agency Agreement Event of Default).
ARTICLE III
3.1 Rent.
(i) Lessee shall pay Basic Rent in arrears on each Payment Date, and
on any date on which this Lease shall terminate; provided, however, with
respect to the Facility Lessee shall have no obligation to pay Basic Rent
until the Basic Term has commenced.
(ii) 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.
(iii) Lessee's inability or failure to take possession of all or
any portion of the Facility 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 the
Facility in accordance with the terms of this Lease.
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, Lessor shall have
all rights, powers and remedies provided for herein or by law r equity or
otherwise in the case of nonpayment of Basic Rent. Lessee shall pay to
Lessor, as Supplemental Rent due and owing to Lessor, among other things, on
demand, to the extent permitted by applicable Legal Requirements, (a) any and
all unpaid fees, charges, payments and other obligations (other than the
obligations of Lessor to pay the principal amount of the Loans and the Holder
Amount) due and owing by Lessor under the Credit Agreement, under the Trust
Agreement and/or under any other Operative Agreement (including specifically
without limitation any amounts owing to the Lenders under Section 2.11,
Section 2.12, Section 2.13 and Section 9.5 of the Credit Agreement and any
amounts owing to the Holder under Section 3.9 or Section 3.10 of the Trust
Agreement) and (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 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. 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 the Ground
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.
ARTICLE IV
4.1 Taxes; Utility Charges. Lessee shall pay or cause to be paid all
Impositions with respect to the Facility and/or the operation, use, repair,
access or maintenance 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 the Facility 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 or accrued for its benefit. 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 the Facility 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,
as appropriate, 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
the Facility 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 Basic Term
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. 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: (i) any damage to or destruction of the Facility or any part thereof;
(ii) any taking of the Facility or any part thereof or interest therein by
Condemnation or otherwise; (iii) any prohibition, limitation, restriction
or prevention of Lessee's use, occupancy or enjoyment of the Facility or any
part thereof, or any interference with such use, occupancy or enjoyment by
any Person or for any other reason; (iv) any title defect, Lien or any
matter affecting title to the Facility; (v) any eviction by paramount title or
otherwise; (vi) any default by Lessor hereunder; (vii) any action for
bankruptcy, insolvency, reorganization, liquidation, dissolution or other
proceeding relating to or affecting the Administrative Agent, any Lender,
Lessor, Lessee, the Holder, any Governmental Authority or any other Person;
(viii) the impossibility or illegality of performance by Lessor, Lessee or
both; (ix) any action of any Governmental Authority or any other Person; (x)
Lessee's acquisition of ownership of all or part of the Facility; (xi)
breach of any warranty or representation with respect to the Facility or any
Operative Agreement; (xii) any defect in the condition, quality or fitness
for use of the Facility or any part thereof; or (xiii) 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 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. 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 (i) to terminate or surrender this
Lease (except as permitted under the terms of the Operative Agreements) or
(ii) 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.
ARTICLE VII
7.1 Ownership of the Facility.
(i) 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 the Facility and (C) Lessee will be treated as the lessee
of the Facility, 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 Facility and will be entitled to all tax benefits
ordinarily available to owners of property similar to the Facility 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, commercial or real
estate law or under any other set of rules. Lessee shall claim the
cost recovery deductions associated with the Facility, and Lessor shall
not (and Lessor shall cause the Holder not to), to the extent not
prohibited by Law, take on its tax return a position inconsistent with
Lessee's claim of such deductions.
(ii) For all purposes other than as set forth in Section 7.1(a),
Lessor and Lessee intend this Lease to constitute a finance lease and
not a true lease. Lessor and Lessee further intend and agree that, for
the purpose of securing Lessee's obligations hereunder, (i) this Lease
shall be deemed to be a security agreement and financing statement
within the meaning of Article 9 of the Uniform Commercial Code (Chapter
9 of the Louisiana Uniform Commercial Code) respecting the Facility and
all proceeds (including without limitation insurance proceeds) thereof
to the extent such is personal (movable) property and an irrevocable
grant and conveyance of a lien and mortgage on the Facility and all
proceeds (including without limitation insurance proceeds) thereof to
the extent such is real (immovable) property; (ii) the acquisition of
title in the Facility (excluding the Land) and a leasehold interest in
the Land pursuant to the Ground Lease referenced in Article II shall be
deemed to be a grant by Lessee to Lessor of, and Lessee hereby grants
to Lessor, a lien on and security interest, mortgage lien and deed of
trust in all of Lessee's right, title and interest (if any) in and to
the Facility (including the Land) and all proceeds (including without
limitation insurance proceeds) of the conversion, voluntary or
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 the Facility; and (iii) notifications to Persons holding
such property, and acknowledgements, 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. Lessor and Lessee shall promptly take such actions as may
be necessary or advisable in either party's opinion (including without
limitation the filing of Uniform Commercial Code Financing Statements,
Uniform Commercial Code Fixture Filings and memoranda of this Lease and
the Lease Supplement) to ensure that the lien, security interest,
mortgage lien and deed of trust in the Facility 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 Facility. LESSEE ACKNOWLEDGES AND AGREES THAT IT IS
LEASING THE FACILITY "AS-IS", "WHERE-IS" WITHOUT REPRESENTATION,
WARRANTY OR COVENANT (EXPRESS OR IMPLIED) BY LESSOR AND IN EACH CASE
SUBJECT TO (A) THE EXISTING STATE OF TITLE, (B) THE RIGHTS OF ANY PARTIES IN
POSSESSION THEREOF (IF ANY), (C) ANY STATE OF FACTS REGARDING THE PHYSICAL
CONDITION OF THE FACILITY AND/OR ITS COMPONENTS, (D) ALL APPLICABLE LEGAL
REQUIREMENTS AND (E) VIOLATIONS OF LEGAL REQUIREMENTS WHICH MAY EXIST
ON THE DATE HEREOF AND/OR THE DATE OF THE LEASE SUPPLEMENT. NEITHER
LESSOR NOR THE ADMINISTRATIVE AGENT NOR ANY LENDER NOR THE HOLDER HAS
MADE OR SHALL BE DEEMED TO HAVE MADE ANY REPRESENTATION, WARRANTY
OR COVENANT (EXPRESS OR IMPLIED) 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 THE FACILITY (OR
ANY PART THEREOF), OR ANY OTHER REPRESENTATION, WARRANTY OR COVENANT
WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE FACILITY (OR ANY PART
THEREOF), AND NEITHER LESSOR NOR THE ADMINISTRATIVE AGENT NOR ANY
LENDER NOR THE HOLDER SHALL BE LIABLE FOR ANY LATENT, HIDDEN, OR PATENT
DEFECT THEREON OR THE FAILURE OF THE FACILITY, OR ANY PART THEREOF, TO
COMPLY WITH ANY LEGAL REQUIREMENT. THE LESSEE HAS OR PRIOR TO THE BASIC
TERM COMMENCEMENT DATE WILL HAVE BEEN AFFORDED FULL OPPORTUNITY TO
INSPECT THE FACILITY AND THE ADDITIONS THEREON (IF ANY), IS OR WILL BE
(INSOFAR AS THE LESSOR, THE ADMINISTRATIVE AGENT, EACH LENDER AND THE
HOLDER 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 THE LESSOR, THE ADMINISTRATIVE AGENT,
THE LENDERS AND THE HOLDER, ON THE ONE HAND, AND THE LESSEE, ON THE
OTHER HAND, ARE TO BE BORNE BY LESSEE.
8.2 Possession and Use of the Facility.
(i) At all times during the Term with respect to the Facility, the
Facility 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 Facility as contemplated by this Lease.
Lessee shall not commit or permit any waste of the Facility or any part
thereof.
(ii) The address stated in Section 29.1 of this Lease is the chief
executive office of Lessee (as such term is 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 chief executive office. Regarding the Facility, the Lease
Supplement correctly identifies the initial location of the related
Equipment and Additions and contains an accurate legal description for
the related parcel of Land. Lessee has no other places of business
where the Equipment or Additions will be located other than those
identified on the Lease Supplement.
(iii) Lessee will not attach or incorporate any item of Equipment
(or any other item of personal property) to or in any other item of
equipment or personal property or to or in any real property in a manner
that would reasonably be expected to 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.
(iv) On the Basic Term Commencement Date, Lessor and Lessee shall
execute the Lease Supplement which shall contain an Equipment Schedule
that has a complete description of each item of Equipment, an Addition
Schedule that has a complete description of each Addition and a legal
description of the Land which is subject to the Ground Lease, all of
which is to be leased (or in the case of the Land, subleased) hereunder
as of such date. The Land shall be deemed to be ground subleased from
Lessor to Lessee as of the Basic Term Commencement Date, and such
ground sublease shall be in effect until the Lease is terminated
or expires, in each case in accordance with the terms and provisions
hereof. Lessee's satisfaction and performance of all obligations
imposed on Lessor under the Ground Lease shall be deemed to satisfy the
obligations of Lessee under such ground sublease. Simultaneously with
the execution and delivery of the Lease Supplement, such Equipment,
Additions, subleasehold interest in the Land and the remainder of the
Facility 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 the Facility,
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 the Facility) shall be
permitted to exercise all rights and remedies under all operation and
easement agreements and related or similar agreements applicable to the
Facility.
8.3 Integrated Facility. In the aggregate, the Facility and the personal
property (movable property) and real property (immovable property) subject to
the Ground Lease 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 cogeneration facility and related facilities
at the level of production required for Final Completion (as such term is
defined in the GE Construction Contract) and otherwise in a commercially
reasonable manner. Furthermore, the Facility and the personal property
(movable property) and real property (immovable property) subject to the
Ground Lease are capable of operating on an independent, stand alone basis
to the extent such are not operated in connection with or as part of the
Lessee's chemical production complex located in or about Plaquemine,
Louisiana.
ARTICLE IX
9.1 Compliance With Legal Requirements and Insurance Requirements.
Subject to the terms of Article XIII relating to permitted contests, Lessee,
at its sole cost and expense, shall (i) comply with all material Legal
Requirements (including without limitation all Environmental Laws), and all
Insurance Requirements relating to the Facility and each of its components,
including without limitation the acquisition, installation, development,
construction, testing, use, maintenance, repair, refurbishment, restoration
and operation thereof, whether or not compliance therewith shall require
structural or extraordinary changes in the Facility or interfere with the use
and enjoyment thereof, and (ii) procure, maintain and comply with all
material licenses, permits, orders, approvals, consents and other
authorizations required for the acquisition, installation, development,
construction, testing, use, maintenance, repair, refurbishment, restoration
and operation of the Facility and each of its components. The Lessee shall
maintain the Facility at all times as a Qualifying Facility.
ARTICLE X
10.1 Maintenance and Repair; Return.
(i) Lessee, at its sole cost and expense, shall maintain the
Facility, and each of its components, in good condition, repair and
working order and in the repair and condition as when originally
delivered to Lessor (ordinary wear and tear excepted) 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 all applicable material Legal Requirements,
Insurance Requirements, and manufacturer's specifications and standards
and on a basis consistent with the operation and maintenance of
properties and/or equipment comparable in type and function to the
Facility, as necessary such that the Facility is capable of being
immediately operated by a third party and in compliance with standard
industry practice subject, however, to the provisions of Article XV with
respect to Condemnation and Casualty.
(ii) Lessee shall not use or locate any component of the Facility
outside of the Approved State. Lessee shall not move or relocate any
component of the Facility beyond the boundaries of the Land.
(iii) If any component of the Facility 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 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).
(iv) Upon reasonable advance notice, Lessor and its agents shall have
the right to inspect the Facility 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.
(v) Lessee shall cause to be delivered to Lessor or any designee of
Lessor (at Lessee's sole expense) Appraisals (or reappraisals) from time
to time as Lessor may request if any one or more of Lessor, the
Administrative Agent, any Lender or the Holder is required pursuant to
any applicable Legal Requirement to obtain such an Appraisal (or
reappraisal), and such Appraisal (or reappraisal) shall be provided by
an appraiser selected by the Person required to obtain such Appraisal
and be in form and substance reasonably satisfactory to the party
required to obtain it.
(vi) Lessor shall under no circumstances be required to build any
improvements or install any equipment at the Facility, make any repairs,
replacements, alterations or renewals of any nature or description to
the Facility, make any expenditure whatsoever in connection with this
Lease or maintain the Facility in any way. Lessor shall not be required
to maintain, repair or rebuild all or any part of the Facility, and
Lessee waives the right to (i) require Lessor to maintain, repair, or
rebuild all or any part of the Facility, or (ii) make repairs at the
expense of Lessor pursuant to any Legal Requirement, Insurance
Requirement, contract, agreement, covenants, condition or restriction at
any time in effect.
(vii) Lessee shall, upon the expiration or earlier termination of
this Lease with respect to the Facility, if Lessee shall not have exercised
its Purchase Option with respect to the Facility and purchased the
Facility, surrender the Facility to Lessor pursuant to (i) the exercise
of certain remedies upon the occurrence of a Lease Event of Default or
(ii) the second paragraph of Section 22.1(a), or the third party
purchaser, as the case may be, subject to Lessee's obligations under
this Lease (including without limitation the obligations of the Lessee
at the time of such surrender under Sections 9.1, 10.1(a)-(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, then not more than 120 days nor less than 60 days prior to the
Expiration Date, Lessee shall, at its sole cost and expense, cause to be
provided to Lessor a Phase I environmental site assessment regarding the
Facility prepared (no more than 30 days prior to the date of delivery) by an
independent recognized professional acceptable to Lessor, the Holder and the
Administrative Agent and in form, scope and content satisfactory to Lessor, the
Holder and the Administrative Agent.
ARTICLE XI
11.1 Modifications.
(i) Lessee at its sole cost and expense, at any time and from time
to time without the consent of Lessor may make alterations, renovations,
improvements and additions to the Facility or any part thereof and
substitutions and replacements therefor, but excluding Approved Turbines
(collectively, "Modifications"), and Lessee shall make any and all
Modifications required to be made pursuant to any applicable Legal
Requirement; provided, that: (i) except for any Modification required
to be made pursuant to a Legal Requirement, no Modification shall
materially impair the value, utility or useful life of the Facility
from that which existed immediately prior to such Modification; (ii)
each Modification shall be done expeditiously and in a good and
workmanlike manner; (iii) Lessee shall comply with all material Legal
Requirements (including all Environmental Laws) and Insurance Requirements
applicable to each Modification, including the obtaining of all permits,
licenses, consents and certificates, and neither the structural integrity
of the Facility nor the steam or power production output shall be
adversely affected; (iv) to the extent required by 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 each Modification;
(vi) each Modification shall comply with the requirements of this Lease
(including without limitation Sections 8.2 and 10.1); and (vii) no
component of the Facility shall be demolished or otherwise rendered
unfit for use unless Lessee shall finance the proposed replacement
Modification therefor outside of this lease facility or such demolition
or alteration will not have a material adverse effect upon the
usefulness, operation, value or economic life of the Facility. All
Modifications shall immediately and without further action upon their
incorporation into the Facility (1) become property of the Lessor, (2)
be subject to this Lease and (3) be titled in the name of Lessor.
Lessee shall not remove or attempt to remove any Modification from the
Facility. The Ground Lease for the Facility 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 the Facility caused
by the removal or attempted removal of any Modification.
(ii) The construction process provided for in the Agency Agreement is
acknowledged by Lessor and the Administrative Agent to be consistent with
and in compliance with the terms and provisions of this Article XI.
11.2 Approved Turbines. Lessee shall comply in full with all its
obligations relating to Approved Turbines set forth in Section 10.3(h) of the
Participation Agreement.
ARTICLE XII
12.1 Warranty of Title.
(i) Title in the Facility (including without limitation all
Equipment, all Additions, all replacement components to the Facility and
all Modifications) shall immediately and without further action vest in
and such shall become the property of Lessor and be subject to the terms
of this Lease (provided Lessor's interest in the Land is acknowledged to
be a leasehold interest pursuant to the Ground Lease) from and after the
date hereof or such date of incorporation into the Facility. 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
the Facility, 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 the Lessor, the Administrative Agent or the Holder
pursuant to the Operative Agreements, 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 the Facility, the Rent or any
other such amounts, and Lessee represents and warrants to, and covenants
with, Lessor that the Liens in favor of the Lessor created by the
Operative Agreements are first priority perfected Liens subject only to
Permitted Liens.
(ii) Nothing contained in this Lease shall be construed as
constituting the consent or request of 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 the Facility or any part thereof. NOTICE
IS HEREBY GIVEN THAT LESSOR IS NOT AND SHALL NOT BE LIABLE FOR ANY
LABOR, SERVICES OR MATERIALS FURNISHED OR TO BE FURNISHED TO LESSEE, OR
TO ANYONE HOLDING THE FACILITY 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 LESSOR
IN AND TO THE FACILITY.
ARTICLE XIII
13.1 Permitted Contests Other Than in Respect of Indemnities. Except to
the extent otherwise provided for in Section 13 of the Participation Agreement,
Lessee, on its own or on Lessor's behalf 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, or utility charges 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 Facility, Lessor, the
Holder, the Administrative Agent and each Lender; (b) there shall not be
imposed a Lien (other than Permitted Liens) on the Facility and no part of
the Facility nor any Rent 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
Lessor, the Holder, the Administrative Agent or any Lender 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 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.
ARTICLE XIV
14.1 Public Liability and Workers' Compensation Insurance. During the
Term for the Facility, 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 the Facility or the premises where the Equipment is located. 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 in no event shall have a minimum combined single
limit per occurrence coverage (i) for commercial general liability of less
than $1,000,000 and (ii) for umbrella liability of less than $25,000,000.
The policies shall name the Lessee as the insured and shall be endorsed to
name Lessor, the Holder, the Administrative Agent and the Lenders 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 Lessor, the Holder,
the Administrative Agent or any Lender may have in force. In the operation
of the Facility, Lessee shall comply with workers' compensation laws
applicable to Lessee and protect Lessor, the Holder, the Administrative Agent
and each Lender against any liability under such laws.
14.2 Permanent Hazard and Other Insurance.
(i) During the Term for the Facility, Lessee shall keep the Facility
insured against all risk of physical loss or damage, including by flood
and shall maintain builders' risk insurance prior to Completion and the
commencement of commercial operation of the Facility in each case in
amounts no less than the Termination Value from time to time and on terms
that are no less favorable than insurance covering other similar
properties owned by Lessee. The policies shall name the Lessee as the
insured and shall be endorsed to name Lessor as a named additional
insured and loss payee and the Holder and the Administrative Agent, on
behalf of itself and the Lenders to the extent of their respective
interests, as mortgagee and an additional named insured and loss payee;
provided, so long as no Event of Default exists, any loss payable under
the insurance policies required by this Section for losses up to
$5,000,000 will be paid to Lessee.
(ii) During the Term, Lessee shall, in the operation and use of the
Facility, 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. Lessee shall, in the operation of the Facility,
comply with workers' compensation laws applicable to Lessee, and
protect Lessor, the Holder, the Administrative Agent and each Lender
against any liability under such laws.
(iii) In addition, during the Term and with respect to the
Facility, the Lessee shall require that its general contractor(s)
procure and carry (i) commercial general liability insurance meeting the
requirements set forth above but taking into account the business of the
Contractors and having a minimum combined single limit coverage of not
less than $1,000,000 and (ii) workers' compensation insurance meeting
the requirements set forth above.
14.3 Coverage.
(i) As of the date of this Lease and annually thereafter during the
Term, Lessee shall furnish Lessor, the Holder and the Administrative Agent
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, the
Holder, the Administrative Agent and the Lender as additional insureds
and loss payees and evidencing the other requirements of this Article
XIV; provided, that liability policies shall specifically name the
Lenders and Holder as additional insureds; provided, further, with
respect to builders' risk insurance and permanent hazard insurance,
Lessee shall provide (and Lessee shall procure from Lessee's
Contractors) evidence of insurance. All such insurance shall be at the
cost and expense of Lessee (or the Lessee's Contractors with respect to
insurance required to be maintained by such Contractors) and provided by
financially sound insurance companies having a claims-paying ability no
less favorable than the companies providing insurance covering similar
properties owned by Lessee. Lessee shall cause such certificates to
include a provision for reasonable advance written notice by the
insurer to Lessor and the Administrative Agent in the event of
cancellation or material alteration of such insurance. If an Event of
Default has occurred and is continuing and Lessor so requests, Lessee
shall deliver to Lessor copies of all insurance policies required by
Sections 14.1 and 14.2.
(ii) Lessee agrees that the insurance policy or policies required by
Sections 14.1 and 14.2(a) shall include an appropriate clause pursuant to
which any such policy shall provide that (i) 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 and (ii) that coverage will continue notwithstanding any
negligence or breach by Lessee or the general contractor, as the case
may be, any Affiliate thereof, any agent of Lessee or any Person;
provided, such waiver of negligence provision need not provide a waiver
of the gross negligence or willful misconduct or willful breach of an
Indemnified Person seeking coverage under any policy. Lessee hereby
waives any and all such rights against the Lessor, the Holder, the
Administrative Agent and the Lenders to the extent of payments made to
any such Person under any such policy.
(iii) 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.
(iv) 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.
(i) Subject to the provisions of 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 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 award, compensation or
insurance proceeds under Sections 14.2(a) or (b) hereof to which Lessee
or Lessor may become entitled by reason of their respective interests
in the Facility (i) if all or a portion of the Facility is damaged or
destroyed in whole or in part by a Casualty or (ii) if the use, access,
occupancy, easement rights or title to the Facility or any part thereof
is the subject of a Condemnation; provided, however, if a Default or
Event of Default shall have occurred and be continuing or if such
award, compensation or insurance proceeds shall exceed $5,000,000, 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.
(ii) 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 Administrative Agent
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.
(iii) If Lessee shall receive notice of a Casualty or a possible
Condemnation of the Facility or any interest therein where damage to the
Facility is estimated to equal or exceed ten percent (10%) of the
Facility Cost, Lessee shall give notice thereof to the Lessor and to
the Administrative Agent promptly after the receipt of such notice. In
such event or in the event that a condemnation award or other
compensation or insurance proceeds in excess of $12,000,000 are
received by Lessee or Lessor in respect of any Casualty or Condemnation,
then Lessee shall be deemed to have delivered a Termination Notice and
the provisions of Sections 16.1 and 16.2 shall apply.
(iv) 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 in accordance with Section 16.1 if Lessee, within
thirty (30) days after such occurrence, delivers to Lessor and the
Administrative Agent a notice to such effect.
(v) 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 Facility, Lessee shall, at its sole cost and expense and using,
if available, the proceeds of any award, compensation or insurance with
respect to such Casualty or Condemnation (including, without limitation,
any such award, compensation or insurance which has been received by the
Administrative Agent and which should be turned over to Lessee pursuant
to the terms of the Operative Agreements, and if not available or
sufficient, using its own funds), promptly and diligently repair any
damage to the Facility 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 Equipment, Additions or other components of the Facility
(as modified to give effect to any subsequent Modifications and all
applicable Legal Requirements), to restore the Facility to substantially
the same 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 had been
satisfied). In such event, title to the Facility shall remain with Lessor.
(vi) In no event shall a Casualty or Condemnation with respect to
which this Lease remains in full force and effect under this Section
15.1 affect Lessee's obligations to pay Rent pursuant to Article III.
(vii) Notwithstanding anything to the contrary set forth in
Section 15.1(a) or Section 15.1(e), if during the Term with respect to
the Facility a Casualty occurs with respect to the Facility or Lessee
receives notice of a Condemnation with respect to the Facility, and
following such Casualty or Condemnation, the Facility cannot reasonably
be restored, repaired or replaced on or before the 180th day prior to
the Expiration Date or the date twelve (12) months after the occurrence
of such Casualty or Condemnation (if such Casualty or Condemnation
occurs during the Term) to the substantially same remaining economic value,
useful life, utility, condition and operation and function as existed
immediately prior to such Casualty or Condemnation (assuming all
maintenance and repair standards had been satisfied) or on or before
such day the Facility is not in fact so restored, repaired or replaced,
then Lessee shall be required to exercise its Purchase Option for the
Facility on the next Payment Date (notwithstanding the limits on such
exercise contained in Section 20.2) and pay Lessor the Termination Value
for the Facility; 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 the Facility; 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 has occurred and is continuing and any
Loans, Holder Fundings or other amounts are owing with respect thereto,
then any Excess Proceeds (to the extent of any such Loans, Holder
Fundings or other amounts owing with respect thereto) shall be paid to
the 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.
15.2 Environmental Matters. Promptly upon Lessee's actual knowledge of
the presence of Hazardous Substances in any portion of the Facility 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 $1,000,000, Lessee shall notify Lessor in
writing of such condition. In the event of any such Environmental Violation
with respect to the Facility (regardless of whether notice thereof must be
given), Lessee shall, not later than thirty (30) days after Lessee has actual
knowledge of such Environmental Violation, either deliver to Lessor a
Termination Notice with respect to the Facility pursuant to Section 16.1, if
applicable, or, at Lessee's sole cost and expense, promptly and diligently
undertake 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 the Facility 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. Prior to any time that Lessee elects to cease
operations with respect to the Facility to a level below that required by
Section 8.2(a) hereof or to remarket the Facility pursuant to Section 20.1
hereof or any other provision of any Operative Agreement, Lessee shall
deliver to Lessor a Phase I environmental site prepared (no more than 30 days
prior to the date of delivery) by an independent recognized professional
acceptable to Lessor, the Holder and the Administrative Agent and in form,
scope and content satisfactory to Lessor, the Holder and the Administrative
Agent. 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 the
Facility for an amount equal 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 the Facility
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) days from the date a Responsible Officer of Lessee has actual
knowledge thereof, Lessee shall provide to Lessor written notice of any
material pending or threatened claim, action or proceeding involving any
Environmental Law applicable to the Facility or any Release on or in
connection with the Facility. 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 the Facility. Lessee shall also promptly provide such detailed reports
of any such material environmental claims as may reasonably be requested by
Lessor.
ARTICLE XVI
16.1 Termination Upon Certain Events. If any of the following occur: (i)
Lessee has delivered a notice pursuant to Section 15.1(d), or is deemed to have
delivered such notice pursuant to Section 15.1(c), then following the
applicable Casualty or Condemnation this Lease shall terminate, or (ii)
Lessee has delivered notice pursuant to the second sentence of Section 15.2
that, due to the occurrence of an Environmental Violation, this Lease shall
terminate, then Lessee shall be obligated to deliver, within thirty (30) days
of its receipt of notice of the applicable Condemnation or the occurrence of
the applicable Casualty or Environmental Violation, a written notice to the
Lessor in the form described in Section 16.2(a) (a "Termination Notice") of
the termination of this Lease.
16.2 Procedures.
(i) A Termination Notice shall contain: (i) notice of termination
of this Lease 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 and purchase the Facility on such Termination Date.
(ii) On the Termination Date, Lessee shall pay to Lessor the
Termination Value for the Facility, and Lessor shall convey the
Facility 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 or more of the following events
(each a "Lease Event of Default") shall occur:
(i) Lessee shall fail to make payment of (i) any portion of Basic
Rent allocable to the principal of the Loans or to the Holder Amount on
the date any such payment is due and payable or (ii) the 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
or (iii) any portion of Basic Rent allocable to interest on the Loans or
Holder Yield within one Business Day after the same has become due and
payable;
(ii) Lessee shall fail to make payment of any Supplemental Rent
(other than Supplemental Rent referred to in Section 17.1(a)(ii)) which
has become due and payable within three Business Days after receipt of
notice that such payment is due;
(iii) Lessee shall fail to maintain insurance as required by
Article XIV of this Lease or deliver any requisite annual certificate
with respect thereto within fifteen (15) days of the date such
certificate is due under the terms hereof;
(iv) Lessee shall fail to observe or perform any material term,
covenant 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, or Lessee shall fail to pay, or cause to be
paid, any Imposition or shall fail to observe any Legal Requirement
regarding the Facility, or 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, and, to the extent such failure, misrepresentation or
breach of warranty is capable of being cured, such failure,
misrepresentation or breach of warranty shall remain uncured for a
period of thirty (30) days after the Lessee has notice thereof;
provided, that if such failure misrepresentation or breach is not
capable of being cured the grace period referred to in this subclause
(d) shall not apply;
(v) An Agency Agreement Event of Default shall have occurred and be
continuing;
(vi) Lessee or any of its Subsidiaries shall default 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 event or
condition shall occur which results in the acceleration of the maturity
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;
(vii) The breach by the Lessee of its obligations (i) under
Sections 9.08 through 9.16 of the GGC Credit Agreement and (ii) under
any other provision of the GGC Credit Agreement incorporated herein
pursuant to Article XXVIII hereof which, in the case of this clause
(ii), shall continue unremedied for a period of 30 days after notice
thereof to the Lessee by the Lessor (through the Holder or the
Administrative Agent or any Lender);
(viii) Lessee or any of its Subsidiaries shall default in the
payment when due of any obligation in an amount of at least $5,000,000
(other than Rent owing hereunder) with regard to any material contract
or agreement relating to the purchase or lease (without regard to
whether such lease is or is not a Capitalized Lease) of goods, machinery
or equipment or the provision of services by or in favor of such entity;
(ix) The Lessee or any of its Subsidiaries shall admit in writing its
inability to, or be generally unable to, pay its debts as such debts
become due;
(x) The Lessee or any of its Subsidiaries shall (i) apply for or
consent to the appointment of, or the taking of possession by, a
receiver, custodian, trustee or liquidator of itself or of all or a
substantial part of its property, (ii) make a general assignment for the
benefit of its creditors, (iii) commence a voluntary case under the
United States Bankruptcy Code, (iv) file a petition seeking to take
advantage of any other law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or readjustment of debts, (v)
fail to controvert in a timely and appropriate manner, or acquiesce in
writing to, any petition filed against it in an involuntary case under
the United States Bankruptcy Code, or (vi) take any corporate or
partnership action for the purpose of effecting any of the foregoing;
(xi) A proceeding or case shall be commenced, without the application
or consent of the Lessee or any of its Subsidiaries in any court of
competent jurisdiction, seeking (i) its liquidation, reorganization,
dissolution or winding-up, or the composition or readjustment of its
debts, (ii) the appointment of a trustee, receiver, custodian,
liquidator or the like of such Person or of all or any substantial part
of its assets, or (iii) similar relief in respect of such Person under
an law relating to bankruptcy, insolvency, reorganization, winding-up,
or composition or adjustment of debts, and such proceeding or case shall
continue undismissed, or an order, judgment or decree approving or
ordering any of the foregoing shall be entered and continue unstayed and
in effect, for a period of 60 days; or an order for relief against such
Person shall be entered in an involuntary case under the United States
Bankruptcy Code;
(xii) The entering of any order in any proceedings against Lessee
or any Material Subsidiary decreeing the dissolution, divestiture or
split-up of Lessee or any Material Subsidiary, and such order remains in
effect for more than sixty (60) days;
(xiii) Any material report, certificate, financial statement or
other instrument delivered to Lessor by or on behalf of Lessee pursuant
to the terms of this Lease or any other Operative Agreement is false or
misleading in any material adverse respect when made or delivered;
(xiv) A final judgment or judgments for the payment of money
shall be rendered by a court or courts against Lessee or any of its
Material Subsidiaries in excess of $5,000,000 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
30 days from the date of entry thereof, or (ii) Lessee or such Material
Subsidiary shall not, within said period of 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 judgements shall not be discharged (or
provisions shall not be made for such discharge) within 30 days after a
decision has been reached with respect to such appeal and the related
stay has been lifted;
(xv) 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 Plan under Title IV of
ERISA; or notice of intent to terminate a Plan or Plans having aggregate
Unfunded Liabilities in excess of $2,000,000 shall be filed under Title
IV of ERISA by 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 Plan or Plans or a
proceeding shall be instituted by a fiduciary of any such Plan or Plans
against 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 Plan or Plans must be terminated;
(xvi)(i) As a result of one 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) of 50% or more of the outstanding common
stock of Lessee; or (ii) without limiting the generality of the
foregoing, during any period of 12 consecutive months, commencing after
the date of this Lease, individuals who at the beginning of such 12-
month period 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 (p)(i); or
(q) Any Operative Agreement shall cease to be in full force and
effect;
then, in any such event, (i) the Facility (whether or not the Basic Term has
previously commenced) shall automatically become subject to the terms of this
Lease as more specifically provided in Section 2.2 and (ii) 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, 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, including without limitation reasonable fees and
expenses of counsel, as a result of any Lease Event of Default hereunder.
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 Facility. Lessor may
enter upon and repossess the Facility 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 from the Facility.
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 Facility promptly to Lessor, in the 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 Facility, for the account of Lessor 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 the Facility 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 Facility pursuant to Section 17.1, (b) the repossession of all or any
of the Facility, nor (c) the failure of Lessor to relet all or any of the
Facility, 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
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
the Facility 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, the Holder's, the
Administrative Agent's and any Lender's reasonable expenses in connection
therewith, including 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.
17.5 Power of Sale. Without limiting any other remedies set forth in this
Lease, in the event that a court of competent jurisdiction rules that this Lease
constitutes a mortgage, deed of trust or other secured financing as is the
intent of the parties, then the Lessor and the Lessee agree that the Lessee
has granted, pursuant to Section 7.1(b) hereof and the Lease Supplement, a
Lien against the Facility WITH POWER OF SALE, and that, upon the occurrence
and during the continuance of any Lease Event of Default, the 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
Facility.
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 13 of the Participation
Agreement, 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 Facility, the Equipment, the
Additions, Fixtures, Modifications and all components thereof, in each case
in recordable form and otherwise in conformity with local custom and free and
clear of the Lien of this Lease (including the release of any memorandum of
Lease and Lease Supplement recorded in connection therewith) and any Lessor
Liens. The Facility shall be conveyed to Lessee "AS IS" and in its 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 Facility, the Equipment, the Additions,
Fixtures, Modifications, any component thereof or related documents unless
Lessee shall have paid in full the Termination Value. 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.
17.7 [Intentionally Omitted].
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 purchase, installation, construction, development,
testing, use or operation of the Facility (including, without limitation, all
right, title and interest of Lessee with respect to all warranty, performance,
service and indemnity provisions).
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 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 the Facility, or real property owned or leased by
Lessee and take all such action thereon as may be necessary or appropriate
therefor. No such entry shall be deemed an eviction of any lessee. All
reasonable out-of-pocket costs and expenses so incurred (including without
limitation fees and expenses of outside 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 the Facility 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, 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 of Lessor's entire interest in the Facility, 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 the Lessor. The Facility 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 the
Facility. Lessee shall not be entitled to exercise its Purchase Option or
the Sale Option separately with respect to the Facility consisting of the
leasehold interest in the Land, the Equipment and/or Additions but shall be
required to exercise its Purchase Option or the Sale Option with respect to
the entire Facility.
ARTICLE XX
20.1 Purchase Option or Sale Option-General Provisions. Not less than 120
days and no more than 180 days prior to the Expiration Date or any Payment Date
after the Basic Term has commenced for the Facility, Lessee may give Lessor and
Administrative Agent irrevocable written notice (the "Election Notice") that
Lessee is electing to exercise either (a) the option to purchase the Facility
on the Expiration Date or on the Payment Date specified in the Election Notice
(the "Purchase Option") or (b) with respect to an Election Notice given in
connection with the Expiration Date only, the option to remarket the Facility
to a Person other than Lessee or any Affiliate of Lessee and cause a sale of
the Facility to occur on the Expiration 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 120 days and not more than 180
days prior to the Expiration Date, then, unless such Expiration Date is the
final Expiration Date to which the Term may be extended, the Term of the
Lease shall be extended in accordance with Section 2.2 hereof; if such
Expiration Date is the final Expiration Date, then Lessee shall be deemed to
have elected the Purchase Option. If Lessee shall elect (or be deemed to
have elected) to exercise the Purchase Option, then Lessee shall pay to Lessor
on the date on which such purchase is scheduled to occur an amount equal to
the Termination Value (which the parties do not intend to be a "bargain"
purchase), and, upon receipt of such amount, Lessor shall transfer to Lessee
all of Lessor's right, title and interest in and to the Facility in
accordance with Section 20.2. If Lessee shall elect the Sale Option and for
any reason shall not cause the Facility to be sold in accordance with the
terms of Section 22.1 on the Expiration Date, then Lessee shall, subject
Section 20.3(b), pay to Lessor on the Expiration Date an amount equal to the
sum of (a) the Maximum Residual Guarantee Amount, plus (b) all Rent and other
amounts then due and owing or accrued under the Operative Agreements, plus
(c) all reasonable out-of-pocket costs incurred by Lessor in connection with
the marketing of the Facility and, in connection therewith, Lessee shall
comply with the terms and provisions of Section 22.1(c) to the same extent as
if the Lessor had exercised its option to retain the Facility pursuant to
Section 22.1(a).
20.2 Lessee Purchase Option. Provided that the Election Notice has been
appropriately given specifying the Purchase Option, Lessee shall purchase all
of the Facility on the Expiration Date or Payment Date (all as specified in the
Election Notice) at a price equal to the Termination Value (which the parties
do not intend to be a "bargain" purchase price).
Subject to Section 19.2, in connection with any termination of this Lease
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, 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: (i) a termination of the Ground Lease (in form and substance
reasonably satisfactory to Lessor and Lessee) and a special or limited
warranty Deed conveying the Facility, excluding the leasehold interest of
Lessor in the Land pursuant to the Ground Lease and only to the extent such
is real (immovable) property, to Lessee free and clear of the Lien of this
Lease, the Lien of the Credit Documents and any Lessor Liens; (ii) a Bill of
Sale conveying the Facility (to the extent it is personal (movable) property)
to Lessee free and clear of the Lien of this Lease, the Lien of the Credit
Documents and any Lessor Liens; (iii) any real estate tax affidavit or other
document required by law to be executed and filed in order to record the Deed
and/or the Ground Lease termination; and (iv) a FIRPTA affidavit. The
Facility shall be conveyed to Lessee "AS IS" "WHERE IS" and in then present
physical condition.
If the Facility is the subject of remediation efforts respecting Hazardous
Substances at the Expiration Date which could materially and adversely impact
the Fair Market Sales Value of the Facility, then Lessee shall be obligated to
repurchase the Facility pursuant to this Section 20.2.
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 Facility on the Expiration Date (all as specified
in the Election Notice) in accordance with the provisions of Section
22.1 hereof.
(b) In the event the Lessee exercises the Sale Option then, as soon
as practicable and in all events not less than 60 days prior to the
Expiration Date, the Lessee at its expense shall cause to be delivered
to Lessor a Phase I environmental site assessment for the Facility
recently prepared (no more than 30 days old) by an independent
recognized professional reasonably acceptable to Lessor, the Holder and
the Administrative Agent and in form, scope and content satisfactory to
Lessor, the Holder and the Administrative Agent. In the event that
Lessor, the Holder and the Administrative Agent shall not have received
such environmental assessment by the date 60 days prior to the
Expiration 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 in
Holder's sole discretion), then Lessee on the Expiration Date shall pay
to Lessor an amount equal to the Termination Value 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 the
Facility in accordance with Section 19.1.
ARTICLE XXI
21.1 [Intentionally Omitted]
ARTICLE XXII
22.1 Sale Procedure.
(i) During the Marketing Period, Lessee, on behalf of the Lessor,
shall use commercially reasonable efforts to obtain bids for the cash
purchase of the Facility in connection with a sale to one or more third
party purchasers to be consummated on the Expiration Date (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
the Facility 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 unless such amounts have been otherwise paid at such time,
Lessee shall pay (or cause to be paid) to Lessor and all other
parties, as appropriate, the sum of all costs and expenses referred to
in clause FIRST of Section 22.2, 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 assume sole responsibility
for obtaining bids by giving Lessee written notice to that effect;
provided, however, that notwithstanding the foregoing, Lessor may not
reject the bids submitted by the Lessee if such bids, in the aggregate,
are greater than or equal to the sum of the Limited Recourse Amount, and
represent bona fide offers from one or more third party purchasers. If
the price which a prospective purchaser or the prospective purchasers
shall have offered to pay for the Facility on the Expiration Date is
less than the sum of the Limited Recourse Amount or if such bids do not
represent bona fide offers from one or more third parties, Lessor may
elect to retain the Facility by giving Lessee written notice of Lessor's
election to retain the Facility, and upon receipt of such notice, Lessee
shall surrender, or cause to be surrendered, the Facility in accordance
with the terms and conditions of Section 10.1.
Unless Lessor shall have elected to retain the Facility pursuant to
the provisions of the final sentence of the preceding paragraph, Lessee
shall arrange for Lessor to sell the Facility free and clear of the
Lien of this Lease and any Lessor Liens attributable to it, without
recourse or warranty (of title or otherwise), for cash on the Sale Date
to the purchaser or purchasers 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 contesting such Lessor Lien by appropriate
proceedings. To effect such transfer and assignment, Lessor shall
execute, acknowledge (where required) and deliver to the appropriate
purchaser each of the following: (i) a special or limited warranty Deed
conveying the Facility (to the extent such is real property titled to
Lessor) and an assignment of the Ground Lease, to the appropriate
purchaser free and clear of the Lien of this Lease, the Lien of the
Security Documents and any Lessor Liens; (ii) a Bill of Sale conveying
the Facility (to the extent it is personal property 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; (iii) any real estate
tax affidavit or other document required by law to be executed and filed
in order to record the Deed and/or the Ground Lease assignment; and (iv)
a FIRPTA affidavit. Lessee shall surrender the Facility so sold or
subject to such documents to each purchaser in the condition specified
in Section 10.1. Lessee shall not take or fail to take any action which
would have the effect of unreasonably discouraging bona fide third party
bids for the Facility. If the Facility is not either (i) sold on the
Sale Date in accordance with the terms of this Section 22.1, or (ii)
retained by the Lessor pursuant to an affirmative election made by the
Lessor pursuant to the second sentence of the second paragraph of this
Section 22.1(a), then the Lessee shall be obligated to pay the Lessor on
the Sale Date an amount equal to the aggregate amount described in the
last sentence of Section 20.1 and to comply with the terms and
provisions of Section 22.1(c).
(ii) If the Facility is sold on a Sale Date to one or more third
party purchasers in accordance with the terms of Section 22.1(a) and the
aggregate purchase price paid for the Facility is less than the sum of
the aggregate Facility Cost (hereinafter such difference shall be
referred to as the "Deficiency Balance"), then the Lessee hereby
unconditionally promises to pay to the Lessor on the Sale Date the
lesser of (i) the Deficiency Balance and (ii) the Maximum Residual
Guarantee Amount. If the Facility is retained by the Lessor pursuant to
an affirmative election made by the Lessor pursuant to the provisions of
Section 22.1(a), then the Lessee hereby unconditionally promises to pay
to the Lessor on the Sale Date an amount equal to the Maximum Residual
Guarantee Amount. Any payment of the foregoing amounts described in
this Section 22.1(b) shall be made together with all amounts referenced
in the last sentence of the first paragraph of Section 22.1(a).
(iii) In the event that the Facility is either sold to one or
more third party purchasers on the Sale Date or retained by the Lessor
in connection with an affirmative election made by the Lessor pursuant
to the provisions of Section 22.1(a), then in either case on the
applicable Sale Date the Lessee shall provide the Lessor or such third
party purchaser(s) with (i) all certificates of Completion, governmental
licenses and authorizations necessary to operate, use, repair, access
and maintain the Facility for its intended purposes, (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 operation, use,
repair, access to or maintenance of the Facility for its intended
purpose or otherwise as the 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), and (iii) a
services agreement covering such services and supplies to be provided by
the Lessee as Lessor or such third party purchaser(s) may request in
order to use and operate the Facility for its intended purposes at such
rates (not in excess of arm's-length fair market rates) as shall be
acceptable to Lessee and Lessor or such third party purchaser(s).
All assignments, licenses, easements, agreements and other deliveries
required by clauses (i), (ii) and (iii) of this paragraph (c) shall
be in form reasonably satisfactory to the Lessor or such third party
purchaser(s), as applicable, and shall be fully assignable (including
both primary 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 the Lessor or such
third party purchaser(s), as applicable, evidencing the continuation or
assignment of the Ground Lease.
22.2 Application of Proceeds of Sale. The Lessor shall apply the proceeds
of sale of the Facility in the following order of priority:
(1) FIRST, to pay or to reimburse Lessor for the payment of all
reasonable costs and expenses incurred by Lessor in connection with the
sale;
(2) SECOND, so long as the Credit Agreement is in effect and
any Holder Fundings or any amount is owing to the Holder under any
Operative Agreement, to the Administrative Agent to be applied pursuant
to the inter-creditor provisions between the Lenders and the Holder
contained in the Operative Agreements; and
(3) THIRD, to the Lessee.
22.3 Indemnity for Excessive Wear. If the proceeds of the sale described
in Section 22.1 with respect to the Facility, less all expenses incurred by
Lessor in connection with such sale, shall be less than the Limited Recourse
Amount, 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 the
Facility, 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
Net Sale Proceeds Shortfall, whichever amount is less.
22.4 Appraisal Procedure. For determining the Fair Market Sales Value of
the Facility 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 qualified appraisers, one chosen by Lessee and one chosen by
essor, 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 Lessor. If the two appraisers
cannot agree within twenty (20) days after both shall have been appointed,
then a third appraiser shall be selected by the two appraisers or, failing
agreement as to such third appraiser within (30) days after both shall have
been appointed, by the American Arbitration Association. The decisions of
the three 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 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 13
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 Facility (including the
installment of Basic Rent due on the Expiration 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 the
Facility or any other 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
the Facility after the expiration or earlier termination of this Lease (unless
the Facility 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 the Facility and Lessee shall continue to pay Basic Rent
at one hundred ten percent (110%) of the Basic Rent that would otherwise be due
and payable at such time. Such Basic Rent shall be payable from time to time
upon demand by Lessor and such additional ten percent (10%) amount shall be
applied by the Lessor to the payment of the Loans pursuant to the Credit
Agreement and the return of Holder Fundings pursuant to the Trust Agreement
pro rata between the Loans and the Holder Fundings. 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 the Facility. 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 Lease (unless the Facility
is conveyed to Lessee) and nothing contained herein shall be read or construed
as preventing Lessor from maintaining a suit for possession of the Facility 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 the Facility 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 the Facility 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.
(i) Lessee may not assign this Lease or any of its rights or
obligations hereunder or with respect to the Facility in whole or in
part to any Person without the prior written consent of the
Administrative Agent, the Holder and the Lessor.
(ii) No assignment by Lessee (referenced in this Section 25.1 or
otherwise) or other relinquishment of possession to the Facility 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 this Lease as to any assignment regarding this Lease.
(iii) In its sole discretion, Lessor may elect to assign,
transfer or otherwise convey any or all of its right, title, interest
or obligations in connection with the Lease and/or the Facility.
25.2 Subleases.
(i) Promptly following the execution and delivery of any sublease
permitted by this Article XXV, Lessee shall notify Lessor of the
execution of such sublease.
(ii) Subject to the provisions of Section 25.2(c), Lessee may sublet
the Facility or portion thereof to any wholly-owned Subsidiary of the
Lessee without the prior written consent of the Administrative Agent or
the Lessor. Except as referenced in the immediately preceding sentence,
no other subleases shall be permitted unless consented to in writing by
the Administrative Agent and the Lessor.
(iii) No sublease (referenced in this Section 25.2 or otherwise)
or other relinquishment of possession to the Facility 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,
or portion thereof, so sublet. During the Basic Term, the term of any
such sublease shall not extend beyond the Basic Term. During the
Renewal Term, the term of any such sublease shall not extend beyond the
Renewal 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 the Facility 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, prior to the payment or performance of all
obligations under the Credit Documents, the Administrative Agent and the
Holder, and no act by Lessor or the Administrative Agent or any
representative or agent of Lessor or the Administrative Agent or the Holder,
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 the Facility, (c)
any Notes, or (d) a beneficial interest in Lessor.
ARTICLE XXVIII
28.1 Incorporation of Covenants. Reference is made to that certain
Credit Agreement dated as of March 30, 1995 (as amended through the date
hereof, the "GGC Credit Agreement") among the Lessee, each of the lenders
that is a signatory thereto and The Chase Manhattan Bank (National
Association), as Administrative Agent. Further reference is made to the
representations and warranties of the Lessee contained in Section 8 of the
GGC Credit Agreement (hereinafter referred to as the "Incorporated
Representations and Warranties") and the covenants contained in Section 9 of
the GGC Credit Agreement (hereinafter referred to as the "Incorporated
Covenants"). The Lessee agrees with the Lessor that the Incorporated
Representations and Warranties and the Incorporated Covenants (and all other
relevant provisions of the GGC Credit Agreement related thereto, including
specifically without limitation the defined terms contained in Section 1
thereof which are used in the Incorporated Representations and Warranties
and/or the Incorporated Covenants for the purpose of determining compliance
therewith and the interpretation thereof) are hereby incorporated by reference
into this Lease to the same extent and with the same effect as if set forth
fully herein, mutatis mutandis, and shall inure to the benefit of the Lessor,
without giving effect to any waiver, amendment, modification or replacement
of the GGC 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 and
provided, that, for the purpose of determining compliance with Section 9.09
of the GGC Credit Agreement, "interest expense" set forth in the relevant
definitions applicable thereto shall include, for the relevant period, all
Basic Rent payable hereunder for such period. In the event a waiver is
granted under the GGC Credit Agreement or an amendment or modification is
executed with respect to the GGC Credit Agreement, and such waiver, amendment
and/or modification affects the Incorporated Representations and Warranties
or the Incorporated Covenants, then such waiver, amendment or modification
shall be effective with respect to the Incorporated Representations and
Warranties and the Incorporated Covenants as incorporated by reference into
this Lease only if consented to in writing by the Majority Lenders. In the
event of any replacement of the GGC Credit Agreement with a similar credit
facility (the "New Facility") the representations and warranties and
covenants contained in the New Facility which correspond to the
representations and warranties and covenants contained in Section 8 and
Section 9 of the GGC Credit Agreement shall become the Incorporated
Representations and Warranties and the Incorporated Covenants hereunder only
if consented to in writing by the Lessor and the Majority Lenders and, if
such consent is not granted or if the GGC Credit Agreement is terminated and
not replaced, then the representations and warranties and covenants contained
in Section 8 and Section 9 of the GGC Credit Agreement (together with any
modifications or amendments approved in accordance with this paragraph) shall
continue to be the Incorporated Representations and Warranties and the
Incorporated Covenants hereunder.
ARTICLE XXIX
29.1 Notices. All notices required or permitted to be given under this
Lease shall be in writing. Notices may be served by certified or registered
mail, postage paid with return receipt requested; by private courier,
prepaid; by telex, facsimile, or other telecommunication device capable of
transmitting or creating a written record; or personally. Mailed notices
shall be deemed delivered five days after mailing, properly addressed.
Couriered notices shall be deemed delivered when delivered as addressed, or
if the addressee refuses delivery, when presented for delivery
notwithstanding such refusal. Telex or telecommunicated notices shall be
deemed delivered when receipt is either confirmed by confirming transmission
equipment or acknowledged by the addressee or its office. Personal delivery
shall be effective when accomplished. Unless a party changes its address by
giving notice to the other party as provided herein, notices shall be
delivered to the parties at the following addresses:
If to Lessee:
Georgia Gulf Corporation
400 Perimeter Center Terrace
Suite 595
Atlanta, Georgia 30346
Attention: Samuel M. Hensley
Corporate Controller
Telephone No.: (770) 395-4577
Telecopy No.: (770) 395-4529
If to Lessor:
First Security Bank of Utah, N.A.
79 South Main Street
Salt Lake City, Utah 84111
Attention: Val T. Orton
Telephone No.: (801) 246-5208
Telecopy No.: (801) 246-5053
with a copy to the Administrative Agent:
NationsBank, N.A. (South)
600 Peachtree Street, N.E.
21st Floor
Atlanta, Georgia 30308
Attention: Catherine J. Rhodes
Vice President
Telephone No.: (404) 607-5531
Telecopy No.: (404) 607-6484
and to:
NationsBank, N.A.
NC1-001-15-04
101 North Tryon Street
15th Floor
Charlotte, North Carolina 28255
Attention: Melissa P. Mullis
Corporate Credit Services
Representative
Telephone No.: (704) 386-2881
Telecopy No.: (704) 386-9923
or such additional parties and/or other address as such party may hereafter
designate, and shall be effective upon receipt or refusal thereof.
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, the Lease
Supplement nor any provision hereof may be amended, waived, discharged or
terminated except by an instrument in writing in recordable form signed by
Lessor and Lessee, subject to Sections 10.2 and 14.5 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 and the same instrument.
30.6 GOVERNING LAW. THIS LEASE SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF GEORGIA.
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 360 days
or, to the extent such Rent is based on the Prime Lending Rate, 365 (or 366, as
applicable) days.
30.8 Memoranda of Lease and Lease Supplement. This Lease shall not be
recorded; provided, Lessor and Lessee shall promptly record (a) a memorandum
of this Lease and the Lease Supplement (in substantially the form of Exhibit
B-1 attached hereto) regarding the Facility promptly after the commencement
of the Basic Term therefor in the local filing office with respect thereto,
and (b) a memorandum of this Lease (in substantially the form of Exhibit B-2
attached hereto) promptly after the date hereof in the local filing office
where the Facility is to be located with respect thereto, in all cases at
Lessee's cost and expense, and as required under applicable law to
sufficiently evidence this Lease or the Lease Supplement in the applicable
real estate filing records.
30.9 Allocations between the Lenders and the Holder. Notwithstanding
any other term or provision of this Lease to the contrary, the allocations
of the proceeds of the Facility and any and all other Rent and other amounts
received hereunder shall be subject to the inter-creditor provisions between
the Lenders and the Holder contained in the Operative Agreements (or as
otherwise agreed among the Lenders and the Holder from time to time).
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 Facility (and in no circumstance to the Administrative Agent,
the Lenders, the Holder 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 Facility 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.
30.11 WAIVERS OF JURY TRIAL. TO THE FULLEST EXTENT ALLOWED BY
APPLICABLE LAW, THE LESSOR AND THE LESSEE IRREVOCABLY AND UNCONDITIONALLY
WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS LEASE
OR ANY COUNTERCLAIM THEREIN.
30.12 Acknowledgement of Security Agreement. The Lessee hereby
acknowledges that the Lessor has granted security interests in the right,
title and interest of Lessor to the Administrative Agent and the Holder, as
more specifically set forth in the Security Agreement.
30.13 Submission To Jurisdiction; Waivers. Each of the parties hereto
hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Lease and the other Operative Agreements to which
it is a party, or for recognition and enforcement of any judgement in respect
thereof, to the non-exclusive general jurisdiction of the Courts of the State
of Georgia, the courts of the United States of America for the Northern
District of Georgia, and appellate courts from any thereof;
(b) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail) postage prepaid, to such party at its
address set forth in Section 29.1 or at such other address of which the
parties hereto shall have been notified pursuant thereto;
(c) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction; and
(d) waives, to the maximum extent not prohibited by law, any right
it may have to claim or recover in any legal action or proceeding referred to
in this Section 30.13 any special, exemplary or punitive damages.
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, BUT NOT
LIMITED TO, 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 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 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.
[Signature pages follow]
IN WITNESS WHEREOF, the parties have caused this Lease to be duly executed
and delivered as of the date first above written.
GEORGIA GULF CORPORATION
By:
Name:
Title:
FIRST SECURITY BANK OF UTAH, N.A.,
not individually, but solely as
Owner Trustee under the GGC Trust
1996-1, as Lessor
By:
Name:
Title:
Agreed to:
Val T. Orton, subject to Section 6.9 of the
Trust Agreement, as Owner Trustee
Receipt of this original
counterpart of the foregoing
Lease is hereby acknowledged
as the date hereof
NATIONSBANK, N.A. (SOUTH),
as Administrative Agent
By:
Name:
Title:
EXHIBIT A TO
THE LEASE
LEASE SUPPLEMENT NO. ___
THIS LEASE SUPPLEMENT NO. ___ (this "Lease Supplement") dated as of
[________________] between FIRST SECURITY BANK OF UTAH, N.A., a national
banking association, not individually, but solely as Owner Trustee under the
GGC Trust 1996-1, as lessor (the "Lessor"), and Georgia Gulf Corporation, a
Delaware corporation, as lessee (the "Lessee").
WHEREAS, the Lessor is the owner or will be the owner of the Facility
described on Schedule I hereto (the "Facility") 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 6, 1996, among the Lessee, the Lessor, not
individually, except as expressly stated therein, but solely as Owner Trustee
under the GGC Trust 1996-1, NationsBanc Leasing Corporation of North
Carolina, as the Holder, each bank and other lender listed on the signature
pages thereto as a lender, as the Lenders, and NationsBank, N.A. (South), as
Administrative Agent for the Lenders.
SECTION 2. The Facility. Attached hereto as Schedule I is the
description of the Facility, with an Equipment Schedule attached hereto as
Schedule I-A, an Addition Schedule attached hereto as Schedule I-B and a copy
of the Ground Lease attached hereto as Schedule I-C. Effective upon the
execution and delivery of this Lease Supplement by the Lessor and the Lessee,
the Facility shall be subject to the terms and provisions of the Lease.
SECTION 3. Use of Facility. At all times during the Term with respect to
the Facility, 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 the Facility) shall be permitted to exercise all rights and remedies
under, all operation and easement agreements and related or similar agreements
applicable to the Facility.
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
Administrative 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 IN ACCORDANCE WITH THE LAW OF THE STATE OF
GEORGIA.
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 the Lessor and the Lessee
agree that the Lessee hereby grants a Lien against the Facility WITH POWER OF
SALE, and that, upon the occurrence of any Lease Event of Default, the 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 Facility.
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 and the
same instrument.
[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.]
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 OF UTAH, N.A., not
individually, but solely as Owner Trustee under
the GGC Trust 1996-1, as Lessor
By
Name:
Title:
GEORGIA GULF CORPORATION, as Lessee
By
Name:
Title:
Agreed to:
Val T. Orton, subject to Section 6.9 of the
Trust Agreement, as Owner Trustee
Receipt of this original counterpart of the foregoing Lease Supplement is
hereby acknowledged as the date hereof.
NATIONSBANK, N.A. (SOUTH), as Administrative Agent
By:
Name:
Title:
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 OF UTAH,
N.A., a national banking association, not individually, but solely as Owner
Trustee under the GGC Trust 1996-1, on behalf of the Owner Trustee.
FIRST SECURITY BANK OF UTAH, N.A., not
individually, but solely as Owner Trustee under
the GGC Trust 1996-1, as Lessor
By
Name:
Title:
[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 GEORGIA GULF CORPORATION, a
Delaware corporation, on behalf of the corporation.
GEORGIA GULF CORPORATION
By:
Name:
Title:
[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 VAL T. ORTON, a resident of Davis County, Utah, subject to Section 6.9 of
the Trust Agreement, as Owner Trustee.
Val T. Orton, subject to Section 6.9 of the Trust
Agreement, as 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 NATIONSBANK, N.A. (SOUTH), a
national banking association, as Administrative Agent.
NATIONSBANK, N.A. (SOUTH), as Administrative
Agent
By:
Name:
Title:
[Notarial Seal]
Notary Public
My commission expires:____________
SCHEDULE I
TO LEASE SUPPLEMENT NO. ____
SCHEDULE I-A
TO LEASE SUPPLEMENT NO. ____
(Equipment)
SCHEDULE I-B
TO LEASE SUPPLEMENT NO. ____
(Additions)
SCHEDULE I-C
TO LEASE SUPPLEMENT NO. ____
(Ground Lease)
[CONFORM TO STATE LAW REQUIREMENTS]
EXHIBIT B-1 TO THE LEASE
Recordation requested by:
Moore & Van Allen, PLLC
After recordation return to:
Moore & Van Allen, PLLC (WMA)
NationsBank Corporate Center
100 North Tryon Street, Floor 47
Charlotte, NC 28202-4003
Space above this line
for Recorder's use
MEMORANDUM OF LEASE AGREEMENT
(TAX RETENTION OPERATING LEASE) AND
LEASE SUPPLEMENT NO. _____________
THIS MEMORANDUM OF LEASE AGREEMENT (TAX RETENTION OPERATING
LEASE) AND LEASE SUPPLEMENT NO. ____________ ("Memorandum"), dated as of
_____________, 199___, is by and between FIRST SECURITY BANK OF UTAH, N.A., a
national banking association, not individually, but solely as Owner Trustee
under the GGC Trust 1996-1, with an office at 79 South Main Street, Salt Lake
City, Utah 84111 (hereinafter referred to as "Landlord") and GEORGIA GULF
CORPORATION, a Delaware corporation, with an office at 400 Perimeter Center
Terrace, Suite 595, Atlanta, Georgia 30346 (hereinafter referred to as
"Tenant").
WITNESSETH:
That for value received, Landlord and Tenant do hereby covenant, promise
and agree as follows:
1. Demised Premises and Date of Lease. Landlord has leased to Tenant,
and Tenant has leased from Landlord, for the Term (as hereinafter defined),
certain real property and other property located in ________________, which
is described in the attached Exhibit A (the "Facility"), pursuant to the
terms of a Lease Agreement (Tax Retention Operating Lease Agreement), between
Landlord and Tenant dated as of February 6, 1996 (the "Lease") and a Lease
Supplement No. _____ between Landlord and Tenant dated as of ______________
(the "Lease Supplement").
2. Term, Renewal, Extension and Purchase Option . The term of the Lease
("Term") commenced as of _____________ and shall end as of _________________,
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.
Landlord's tax payer number_______________.
Tenant'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 the Lessor and the Lessee
agree that the Lessee has granted, pursuant to the terms of the Lease and the
Lease Supplement, a Lien against the Facility WITH POWER OF SALE, and that,
upon the occurrence and during the continuance of any Lease Event of Default,
the 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 Facility.
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 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.]
IN WITNESS WHEREOF, the parties hereto have duly executed this instrument
as of the day and year first written.
LANDLORD: TENANT:
FIRST SECURITY BANK GEORGIA GULF CORPORATION,
OF UTAH, N.A. not individually, a Delaware corporation
but solely as Owner Trustee
under the GGC Trust 1996-1
By:___________________________ By:__________________________
Its:__________________________ Its:_________________________
Agreed to:
Val T. Orton, subject to Section 6.9 of the
Trust Agreement, as Owner Trustee
EXHIBIT A
[DESCRIPTION OF FACILITY]
STATE OF _______________ )
) ss:
COUNTY OF ______________ )
The foregoing Memorandum was acknowledged before me, the undersigned
Notary Public, in the County of _____________ this _____ day of ___________,
by ________________, as __________________ of FIRST SECURITY BANK OF UTAH,
N.A., a national banking association, not individually, but solely as Owner
Trustee under the GGC Trust 1996-1, on behalf of the Owner Trustee.
FIRST SECURITY BANK OF UTAH, N.A., not
individually, but solely as Owner Trustee under
the GGC Trust 1996-1, as Lessor
By:
Name:
Title:
[Notarial Seal]
Notary Public
My commission expires:____________
STATE OF _______________ )
) ss:
COUNTY OF ______________ )
The foregoing Memorandum was acknowledged before me, the undersigned
Notary Public, in the County of __________ this _____ day of ______________,
by ________________, as __________________ of GEORGIA GULF CORPORATION, a
Delaware corporation, on behalf of the corporation.
GEORGIA GULF CORPORATION
By:
Name:
Title:
[Notarial Seal]
Notary Public
My commission expires:____________
STATE OF _______________ )
) ss:
COUNTY OF ______________ )
The foregoing Memorandum was acknowledged before me, the undersigned
Notary Public, in the County of ____________ this _____ day of ____________,
by VAL T. ORTON, a resident of Davis County, Utah, subject to Section 6.9 of
the Trust Agreement, as Owner Trustee.
Val T. Orton, subject to Section 6.9 of the Trust
Agreement, as Owner Trustee
[Notarial Seal]
Notary Public
My commission expires:____________
[CONFORM TO STATE LAW REQUIREMENTS]
EXHIBIT B-2 TO THE LEASE
Recordation requested by:
Moore & Van Allen, PLLC
After recordation return to:
Moore & Van Allen, PLLC (WMA)
NationsBank Corporate Center
100 North Tryon Street, Floor 47
Charlotte, NC 28202-4003
Space above this line
for Recorder's use
MEMORANDUM OF LEASE AGREEMENT
(TAX RETENTION OPERATING AGREEMENT)
THIS MEMORANDUM OF LEASE AGREEMENT (TAX RETENTION
OPERATING LEASE) ("Memorandum"), dated as of __________________, 199__, is by
and between FIRST SECURITY BANK OF UTAH, N.A., a national banking association,
not individually, but solely as Owner Trustee under the GGC Trust 1996-1, with
an office at 79 South Main Street, Salt Lake City, Utah 84111 (hereinafter
referred to as "Landlord") and GEORGIA GULF CORPORATION, a Delaware
corporation, with an office at 400 Perimeter Center Terrace, Suite 595,
Atlanta, Georgia 30346 (hereinafter referred to as "Tenant").
WITNESSETH:
That for value received, Landlord and Tenant do hereby covenant,
promise and agree as follows:
1. Demised Premises and Date of Lease. Landlord hereby agrees to
lease to Tenant, and Tenant hereby agrees to lease from Landlord, for the
Term (as hereinafter defined), certain real property and other property
located in ___________________ which is described in the attached Exhibit A
(the "Facility"), pursuant to the terms of a Lease Agreement (Tax Retention
Operating Lease Agreement), between Landlord and Tenant dated as of February
6, 1996 (the "Lease").
2. Term, Renewal, Extension and Purchase Option. The term of the Lease
("Term") shall commence (such commencement date may be referred to herein as
the "Basic Term Commencement Date") upon the earlier to occur of (i) the
Completion Date (as such term is defined in the Lease) for the Facility or
(ii) as of the date of any Agency Agreement Event of Default (as such term is
defined in the Lease) and shall end as of the third annual anniversary of the
Basic Term Commencement Date, 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.
Landlord's tax payer number ___________.
Tenant'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 the Lessor and the Lessee agree
that the Lessee has granted, pursuant to the terms of the Lease, a Lien against
the Facility WITH POWER OF SALE, and that, upon the occurrence and during the
continuance of any Lease Event of Default during the Term, the 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
Facility.
5. Effect of Memorandum. The purpose of this instrument is to give
notice of the Lease and its terms, covenants and conditions to the same
extent as if the Lease were fully set forth herein. This Memorandum shall
not modify in any manner the terms, conditions or intent of the Lease and
the parties agree that this Memorandum is not intended nor shall it be used
to interpret the Lease or determine the intent of the parties under the Lease.
[The remainder of this page has been intentionally left blank.]
IN WITNESS WHEREOF, the parties hereto have duly executed this instrument
as of the day and year first written.
LANDLORD: TENANT:
FIRST SECURITY BANK GEORGIA GULF CORPORATION, a
OF UTAH, N.A. not individually, Delaware corporation
but solely as Owner Trustee
under the GGC Trust 1996-1
By:___________________________ By:__________________________
Its:__________________________ Its:_________________________
Agreed to:
Val T. Orton, subject to Section 6.9 of the
Trust Agreement, as Owner Trustee
EXHIBIT A
[DESCRIPTION OF FACILITY]
STATE OF _______________ )
) ss:
COUNTY OF ______________ )
The foregoing Memorandum was acknowledged before me, the undersigned Notary
Public, in the County of _________________ this _____ day of ______________, by
________________, as __________________ of FIRST SECURITY BANK OF UTAH, N.A., a
national banking association, not individually, but solely as Owner Trustee
under the GGC Trust 1996-1, on behalf of the Owner Trustee.
FIRST SECURITY BANK OF UTAH, N.A., not
individually, but solely as Owner Trustee under
the GGC Trust 1996-1, as Lessor
By:
Name:
Title:
[Notarial Seal]
Notary Public
My commission expires:____________
STATE OF _______________ )
) ss:
COUNTY OF ______________ )
The foregoing Memorandum was acknowledged before me, the undersigned Notary
Public, in the County of _________________ this _____ day of ______________,
by ________________, as __________________ of GEORGIA GULF CORPORATION, a
Delaware corporation, on behalf of the corporation.
GEORGIA GULF CORPORATION
By:
Name:
Title:
[Notarial Seal]
Notary Public
My commission expires:____________
STATE OF _______________ )
) ss:
COUNTY OF ______________ )
The foregoing Memorandum was acknowledged before me, the undersigned Notary
Public, in the County of _________________ this _____ day of ______________, by
VAL T. ORTON, a resident of Davis County, Utah, subject to Section 6.9 of the
Trust Agreement, as Owner Trustee.
Val T. Orton, subject to Section 6.9 of the Trust
Agreement, as Owner Trustee
[Notarial Seal]
Notary Public
My commission expires:____________
EXHIBIT 10(e)
CREDIT AGREEMENT
Dated as of February 6, 1996
among
First Security Bank of Utah, N.A.,
not individually, except as
expressly stated herein,
but solely as Owner Trustee
for GGC Trust 1996-1
as Borrower,
The Several Lenders
from Time to Time Parties Hereto,
and
NATIONSBANK, N.A. (SOUTH)
as Administrative Agent
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Definitional Provisions. . . . . . . . . . . . . . . . . . . . 1
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS . . . . . . . . . . . . . 1
2.1 Commitments. . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.2 Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.3 Procedure for Borrowing. . . . . . . . . . . . . . . . . . . . 2
2.4 Lender Unused Fees; Lender Participation Fees. . . . . . . . . 3
2.5 Termination or Reduction of Commitments. . . . . . . . . . . . 3
2.6 Prepayments and Payments . . . . . . . . . . . . . . . . . . . 3
2.7 Conversion and Continuation Options. . . . . . . . . . . . . . 4
2.8 Interest Rates and Payment Dates . . . . . . . . . . . . . . . 5
2.9 Computation of Interest. . . . . . . . . . . . . . . . . . . . 5
2.10 Pro Rata Treatment and Payments. . . . . . . . . . . . . . . . 6
2.11 Increased Costs, Illegality, etc.. . . . . . . . . . . . . . . 7
2.12 Funding Indemnity. . . . . . . . . . . . . . . . . . . . . . . 8
2.13 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.14 Notice of Amounts Payable; Mandatory Assignment. . . . . . . 10
SECTION 3. REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . . . 11
3.1 Due Organization, etc. . . . . . . . . . . . . . . . . . . . 11
3.2 Authorization; No Conflict . . . . . . . . . . . . . . . . . 12
3.3 Enforceability, Etc. . . . . . . . . . . . . . . . . . . . . 12
3.4 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.5 Lessor Liens . . . . . . . . . . . . . . . . . . . . . . . . 12
3.6 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.7 Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.8 Documentation. . . . . . . . . . . . . . . . . . . . . . . . 13
3.9 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . 13
3.10 Securities Act . . . . . . . . . . . . . . . . . . . . . . . 13
3.11 Chief Place of Business. . . . . . . . . . . . . . . . . . . 13
3.12 Federal Reserve Regulations. . . . . . . . . . . . . . . . . 13
3.13 Investment Company Act . . . . . . . . . . . . . . . . . . . 13
SECTION 4. CONDITIONS PRECEDENT. . . . . . . . . . . . . . . . . . 14
4.1 Conditions to Effectiveness. . . . . . . . . . . . . . . . . 14
4.2 Conditions to Each Loan. . . . . . . . . . . . . . . . . . . 14
SECTION 5. COVENANTS . . . . . . . . . . . . . . . . . . . . . . . 14
5.1 Other Activities . . . . . . . . . . . . . . . . . . . . . . 14
5.2 Ownership of the Facility, Indebtedness. . . . . . . . . . . 14
5.3 Disposition of Assets. . . . . . . . . . . . . . . . . . . . 15
5.4 Compliance with Operative Agreements . . . . . . . . . . . . 15
5.5 Further Assurances . . . . . . . . . . . . . . . . . . . . . 15
5.6 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.7 Discharge of Liens . . . . . . . . . . . . . . . . . . . . . 15
5.8 Trust Agreement. . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 6. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . 16
SECTION 7. THE ADMINISTRATIVE AGENT. . . . . . . . . . . . . . . . 18
7.1 Appointment. . . . . . . . . . . . . . . . . . . . . . . . . 18
7.2 Delegation of Duties . . . . . . . . . . . . . . . . . . . . 19
7.3 Exculpatory Provisions . . . . . . . . . . . . . . . . . . . 19
7.4 Reliance by Administrative Agent . . . . . . . . . . . . . . 19
7.5 Notice of Default. . . . . . . . . . . . . . . . . . . . . . 19
7.6 Non-Reliance on Administrative Agent and Other Lenders . . . 20
7.7 Indemnification. . . . . . . . . . . . . . . . . . . . . . . 20
7.8 Administrative Agent in Its Individual Capacity. . . . . . . 21
7.9 Successor Administrative Agent . . . . . . . . . . . . . . . 21
7.10 Actions of Administrative Agent on Behalf of Holder. . . . . 22
7.11 The Administrative Agent's Duty of Care. . . . . . . . . . . 22
SECTION 8. MATTERS RELATING TO PAYMENTS AND COLLATERAL . . . . . . 22
8.1 Collection and Allocation of Payments and Other Amounts. . . 22
8.2 Certain Remedial Matters . . . . . . . . . . . . . . . . . . 22
8.3 Release of the Facility, etc.. . . . . . . . . . . . . . . . 23
8.4 Holder Excepted Payments . . . . . . . . . . . . . . . . . . 23
SECTION 9. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . 23
9.1 Amendments and Waivers . . . . . . . . . . . . . . . . . . . 23
9.2 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . 24
9.3 No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . 25
9.4 Survival of Representations and Warranties . . . . . . . . . 26
9.5 Payment of Expenses and Taxes. . . . . . . . . . . . . . . . 26
9.6 Successors and Assigns; Participations and Assignments . . . 26
9.7 Participations . . . . . . . . . . . . . . . . . . . . . . . 26
9.8 Assignments. . . . . . . . . . . . . . . . . . . . . . . . . 27
9.9 The Register; Disclosure; Pledges to Federal Reserve Banks . 29
9.10 Adjustments; Set-off . . . . . . . . . . . . . . . . . . . . 29
9.11 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . 30
9.12 Severability . . . . . . . . . . . . . . . . . . . . . . . . 30
9.13 Integration. . . . . . . . . . . . . . . . . . . . . . . . . 30
9.14 GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . . . 30
9.15 Submission To Jurisdiction; Waivers. . . . . . . . . . . . . 31
9.16 Acknowledgements . . . . . . . . . . . . . . . . . . . . . . 31
9.17 WAIVERS OF JURY TRIAL. . . . . . . . . . . . . . . . . . . . 31
9.18 Nonrecourse. . . . . . . . . . . . . . . . . . . . . . . . . 31
9.19 USURY SAVINGS PROVISION. . . . . . . . . . . . . . . . . . . 32
9.20 Replacement of Non-Extending Lenders . . . . . . . . . . . . 33
SCHEDULES
Schedule 1.1 Commitments and Addresses of Lenders
EXHIBITS
Exhibit A Form of Note
Exhibit B Form of Assignment and Acceptance
THIS CREDIT AGREEMENT, dated as of February 6, 1996, is among FIRST
SECURITY BANK OF UTAH, N.A., not individually, except as expressly stated
herein, but solely as Owner Trustee for GGC Trust 1996-1 (the "Owner Trustee"
or the "Borrower"), the several banks and other financial institutions from
time to time parties to this Agreement (the "Lenders") and NATIONSBANK, N.A.
(SOUTH), a national banking association, as Administrative Agent.
The parties hereto hereby agree as follows:
SECTION I. DEFINITIONS
(a) Definitional Provisions. Each capitalized term used in this
Agreement and not otherwise defined herein shall have the meaning ascribed
thereto in Appendix A to the Participation Agreement.
Unless otherwise specified therein, all terms described in this
Agreement shall have the defined meanings when used in the other Credit
Documents or any certificate or other document made or delivered pursuant
hereto or thereto.
The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.
All accounting terms used herein shall have the respective
meanings given to them in accordance with GAAP, unless otherwise provided
herein. All computations and determinations for purposes of determining
compliance with the financial requirements of this Agreement shall be made in
accordance with GAAP, unless otherwise provided herein.
The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms or such terms.
SECTION II. AMOUNT AND TERMS OF COMMITMENTS
(a) Commitments. (a) Subject to the terms and conditions hereof,
each of the Lenders severally agrees to make loans (the "Loans") to the
Borrower from time to time during the Commitment Period in amount up to such
Lender's Commitment as is set forth adjacent to such Lender's name in
Schedule 1.1 hereto for the purpose of enabling the Borrower to purchase the
Facility and to pay Facility Costs and Transaction Expenses, provided, that,
the aggregate principal amount at any one time outstanding with respect to
all Loans shall not exceed the aggregate amount of the Commitments. Any
prepayments of the Loans, whether mandatory or at Borrower's election, shall
not be subject to reborrowing except as set forth in Section 5.2(d) of the
Participation Agreement.
(b) The Loans may from time to time be (i) Eurodollar Loans, (ii) ABR
Loans, or (iii) a combination thereof, as determined by the Borrower and
notified to the Administrative Agent in accordance with Section 2.3 and 2.7.
In the event the Borrower fails to provide notice pursuant to Section 2.3,
the Loan shall be an ABR Loan. Further, any Loan by any Lender in an amount
less than $100,000 shall be an ABR Loan, unless the remaining Available
Commitment for such Lender is less than $100,000, in which case, the Borrower
may elect a Eurodollar Loan for such remaining amount.
(b) Notes. The Loans made by each Lender shall be evidenced by
promissory notes of the Borrower, substantially in the form of Exhibit A in
the case of the Loans (each, a "Note" and collectively, the "Notes"), with
appropriate insertions as to payee, date and principal amount, payable to the
order of such Lender and in a principal amount equal to the Commitment of
such Lender. Each Lender is hereby authorized to record the date, Type and
amount of each Loan made by such Lender, each continuation thereof, each
conversion of all or a portion thereof to another Type, and the date and
amount of each payment or prepayment of principal thereof on the schedule
annexed to and constituting a part of its Note, and any such recordation
shall constitute prima facie evidence of the accuracy of the information so
recorded, provided that the failure to make any such recordation or any error
in such recordation shall not affect the Borrower's obligations hereunder or
under such Note. Each Note shall be dated the Initial Closing Date, be
stated to mature on the Maturity Date and (iii) provide for the payment of
principal in accordance with Section 2.6(d) and the payments of interest in
accordance with Section 2.8
(c) Procedure for Borrowing. The Borrower may borrow under the
Commitments during the Commitment Period on any Business Day that a Funding
may be requested pursuant to the terms of Section 5.2 of the Participation
Agreement, provided that the Borrower shall give the Administrative Agent
irrevocable notice (which must be received by the Administrative Agent prior
to 12:00 Noon, Atlanta, Georgia time, three Business Days prior to the
requested Borrowing Date specifying (A) the amount to be borrowed (which on
any date shall not be in excess of the then Available Commitments), (B) the
requested Borrowing Date, (C) whether the borrowing is to be of Eurodollar
Loans, ABR Loans or a combination thereof, (D) if the borrowing is to be a
combination of Eurodollar Loans and ABR Loans, the respective amounts of each
Type of Loan and (E) the Interest Period applicable to any Eurodollar Loan.
Pursuant to the terms of the Participation Agreement, the Borrower shall be
deemed to have delivered such notice upon the delivery of a notice by the
Construction Agent or the Lessee containing such required information. Upon
receipt of any such notice from the Borrower, the Administrative Agent shall
promptly notify each Lender thereof. Each Lender will make the amount of its
pro rata share of each borrowing available to the Administrative Agent for
the account of the Borrower at the office of the Administrative Agent
specified in Section 9.2 prior to 12:00 Noon, Atlanta, Georgia time, on the
Borrowing Date requested by the Borrower in funds immediately available to
the Administrative Agent. Such borrowing will then be made available to the
Borrower by the Administrative Agent crediting an account designated,
subject to Section 11.1 of the Participation Agreement, by the Borrower on
the books of such office with the aggregate of the amounts made available to
the Administrative Agent by the Lenders and in like funds as received by the
Administrative Agent. No amount of any Loan which is repaid or prepaid by
the Borrower may be reborrowed hereunder, except as set forth in Section
5.2(d) of the Participation Agreement.
On each date which is three (3) Business Days prior to any
Scheduled Interest Payment Date that occurs during the Commitment Period, the
Borrower shall be deemed to have requested a Eurodollar Loan (or, if any
Lender's Loan would be less than $100,000, an ABR Loan) pursuant to Section
2.3(a) in an amount equal to the aggregate amount of interest on the Loans due
and payable on such Scheduled Interest Payment Date. The Borrowing Date with
respect to any such borrowing shall be the relevant Scheduled Interest Payment
Date (provided, that the making of the Loans pursuant to such borrowing shall
be subject to satisfaction of the applicable conditions precedent set forth
in Section 4.2) and the proceeds of such borrowing shall be applied to pay
interest on the Loans due and payable on such date. On each such Borrowing
Date, the Loan Facility Cost shall be increased by an amount equal to the
proceeds of such borrowing used to pay interest on such date with respect to
the Loans due and payable on such date.
(d) Lender Unused Fees; Lender Participation Fees. Promptly after
receipt from the Lessee of the payment of the Lender Unused Fee payable
pursuant to Section 9.4 of the Participation Agreement and/or the Lender
Participation Fee payable pursuant to Section 9.5 of the Participation
Agreement, the Administrative Agent shall distribute such payments to the
Lenders pro rata in accordance with their respective Commitments.
(e) Termination or Reduction of Commitments. The Borrower shall
have the right, upon not less than three (3) Business Days' written notice to
the Administrative Agent, to terminate the Commitments or, from time to time,
to reduce the amount of the Commitments, provided, that (i) after giving
effect to such reduction, the aggregate outstanding principal amount of the
Loans shall not exceed the aggregate Commitments and (ii) such notice shall
be accompanied by a certificate of the Construction Agent stating that the
amount equal to eighty-five percent (85%) of aggregate Budgeted Total
Facility Costs as of the date of such reduction does not exceed the aggregate
amount of Available Commitments as of such date after giving effect to such
reduction. Upon receipt of any such notice the Administrative Agent shall
promptly notify each Lender thereof. Any such reduction (A) shall be in an
amount equal to the lesser of (1) $1,000,000 or (2) the remaining Available
Commitments and (B) shall reduce permanently the Commitments then in effect.
On any date on which the Commitments shall automatically be
reduced to zero pursuant to Section 6, the Borrower shall prepay all
outstanding Loans, together with accrued unpaid interest thereon and all
other amounts owing thereunder.
(f) Prepayments and Payments. Subject to Sections 2.11, 2.12 and
2.13, the Borrower may at any time and from time to time prepay the Loans, in
whole or in part, without premium or penalty, upon at least three (3)
Business Days' irrevocable notice to the Administrative Agent, specifying the
date and amount of prepayment and whether the prepayment is of Eurodollar
Loans, ABR Loans or a combination thereof, and, if a combination thereof, the
amount allocable to each. Upon receipt of any such notice the Administrative
Agent shall promptly notify each Lender thereof. If any such notice is given,
the amount specified in such notice shall be due and payable on the date
specified therein. Amounts prepaid may not be reborrowed, except as set forth
in Section 5.2(d) of the Participation Agreement.
If on any date the Administrative Agent or the Lessor shall receive
any payment in respect of (i) any Casualty or Condemnation pursuant to Section
15.1(a) or 15.1(g) of the Lease (excluding any payments in respect thereof
which are payable to Lessee in accordance with the Lease), or (ii) the
Termination Value in connection with the delivery of a Termination Notice
pursuant to Article XVI of the Lease, or (iii) the Termination Value in
connection with the exercise of the Purchase Option under Section 20.1 of the
Lease or the exercise of the option of the Lessor to transfer the Facility to
the Lessee pursuant to Section 20.3 of the Lease, or (iv) any payment required
to be made or elected to be made by the Construction Agent to the Lessor
pursuant to the terms of the Agency Agreement, then in each case, the
Borrower shall pay such amounts to the Administrative Agent and the
Administrative Agent shall be required to apply and pay such amounts in
accordance with the provisions of Section 10.7(b)(ii) of the Participation
Agreement.
Each prepayment of the Loans pursuant to Section 2.6(a) and 2.6(b)
shall be allocated to reduce the Loan Facility Cost of the Facility.
On each date set forth on Schedule 2 to the Participation
Agreement the Borrower shall repay the outstanding principal balance of the
Loans in part in an amount equal to the product of (i) the percentage set
forth beside such date on such Schedule 2 multiplied by (ii) the aggregate
principal amount of all Loans outstanding calculated as of the Basic Term
Commencement Date. All such partial repayments of the principal balance of
the Loans pursuant to this Section 2.6(d) shall be applied to reduce the Loan
Facility Cost.
(g) Conversion and Continuation Options. (a) The Borrower may elect
from time to time to convert Eurodollar Loans to ABR Loans by giving the
Administrative Agent at least three Business Days' prior irrevocable notice
of such election, provided that any such conversion of Eurodollar Loans may
only be made on the last day of an Interest Period with respect thereto. The
Borrower may elect from time to time to convert ABR Loans to Eurodollar
Loans by giving the Administrative Agent at least three (3) Business Days'
prior irrevocable notice of such election. Upon receipt of any such notice,
the Administrative Agent shall promptly notify each Lender thereof. All
or any part of outstanding Eurodollar Loans or ABR Loans may be converted as
provided herein, provided, that (i) no ABR Loan may be converted into a
Eurodollar Loan after the date that is one month prior to the Maturity Date,
and (ii) in the case of a Eurodollar Loan, such notice of conversion
shall contain an election by the Borrower of an Interest Period for such
Eurodollar Loan to be created by such conversion and such Interest Period
shall be in accordance with the terms of the definition of the term "Interest
Period".
(b) Subject to the restrictions set forth in Section 2.3 hereof, any
Eurodollar Loan may be continued as such upon the expiration of the current
Interest Period with respect thereto by the Borrower giving irrevocable
notice to the Administrative Agent, in accordance with the applicable notice
provision for the conversion of ABR Loans to Eurodollar Loans set forth herein,
of the length of the next Interest Period to be applicable to such Loans,
provided that no Eurodollar Loan may be continued as such after the date that
is one month prior to the Maturity Date and provided, further, that if the
Borrower shall fail to give any required notice as described above or otherwise
herein, or if such continuation is not permitted pursuant to the proceeding
proviso, such Loan shall automatically be converted to an ABR Loan on the
last day of such then expiring Interest Period.
(h) Interest Rates and Payment Dates. The Loans outstanding
hereunder from time to time shall bear interest at a rate per annum equal to
either (i) with respect to a Eurodollar Loan, the Eurodollar Rate determined
for the applicable Interest Period plus the Applicable Percentage or (ii)
with respect to an ABR Loan, the ABR, as selected by the Borrower in
accordance with the provisions hereof; provided, however (A) upon delivery by
the Administrative Agent of the notice described in Section 2.9(c), the Loans
of each of the Lenders shall bear interest at the ABR applicable from time to
time from and after the dates and during the periods specified in Section
2.9(c), (B) upon the delivery by a Lender of the notice described in Section
2.11(d), the Loans of such Lender shall bear interest at the ABR applicable
from time to time from and after the dates and during the periods specified
in Section 2.11(d) and (C) in such other circumstances as expressly provided
herein, the Loans shall bear interest at the ABR.
(b) If all or a portion of (i) the principal amount of any Loan,
(ii) any interest payable thereon or (iii) any other amount payable hereunder
shall not be paid when due (whether at the stated maturity, by acceleration
or otherwise), such overdue amount shall bear interest at a rate per annum
which is the lesser of (x) then current rate of interest respecting such
payment plus two percent (2%) and (y) the highest interest rate permitted by
applicable law, in each case from the date of such non-payment until such
amount is paid in full (whether after or before judgment).
(c) Interest shall be payable in arrears on the applicable Scheduled
Interest Payment Date, provided that (i) interest accruing pursuant to
paragraph (b) of this Section 2.8 shall be payable from time to time on
demand and (ii) each prepayment of the Loans shall be accompanied by accrued
interest to the date of such prepayment on the amount prepaid.
(i) Computation of Interest. Whenever it is calculated on the
basis of the Prime Lending Rate, interest shall be calculated on the basis of
a 365- (or 366-, as the case may be) day year for the actual days elapsed;
and, otherwise, interest shall be calculated on the basis of a 360-day year
for the actual days elapsed. The Administrative Agent shall as soon as
practicable notify the Borrower and the Lenders of each determination of a
Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the ABR or the Eurocurrency Reserve Requirements shall become
effective as of the day on which such change becomes effective. The
Administrative Agent shall as soon as practicable notify the Borrower and the
Lenders of the effective date and the amount of each such change in interest
rate.
Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding
on the Borrower and the Lenders in the absence of manifest error.
If the Eurodollar Rate cannot be determined by the Administrative
Agent in the manner specified in the definition of the term "Eurodollar Rate"
contained in Section 1.1 of this Agreement, the Administrative Agent shall
give telecopy or telephonic notice thereof to the Borrower and the Lenders
as soon as practicable thereafter. Until such time as the Eurodollar Rate can
be determined by the Administrative Agent in the manner specified in the
definition of such term contained in said Section 1.1, no further Eurodollar
Loans shall be made or shall be continued as such at the end of the then
current Interest Period nor shall the Borrower have the right to convert ABR
Loans to Eurodollar Loans.
(j) Pro Rata Treatment and Payments. Each borrowing by the Borrower
from the Lenders hereunder and any reduction of the Commitments of the Lenders
shall be made pro rata according to their respective Commitments. Subject to
the provisions of Sections 2.14(b) and 9.20 hereof, each payment (including
each prepayment) by the Borrower on account of principal of and interest on
the Loans shall be made pro rata according to the respective outstanding
principal amounts on the Loans then held by the Lenders. All payments
(including prepayments) to be made by the Borrower hereunder and under the
Notes, whether on account of principal, interest or otherwise, shall be made
without setoff or counterclaim and shall be made prior to 12:00 Noon, Atlanta,
Georgia time, on the due date thereof to the Administrative Agent, for the
account of the Lenders, at the Administrative Agent's office specified in
Section 9.2, in Dollars and in immediately available funds. The
Administrative Agent shall distribute such payments to the Lenders promptly
upon receipt in like funds as received. If any payment hereunder becomes due
and payable on a day other than a Business Day, such payment shall be
extended to the next succeeding Business Day; provided, however, if such
payment includes an amount of interest calculated with reference to the
Eurodollar Rate and the result of such extension would be to extend such
payment into another calendar month, then such payment shall be made on the
immediately preceding Business Day. In the case of any extension of any
payment of principal pursuant to the preceding two sentences, interest
thereon shall be payable at the then applicable rate during such extension.
Unless the Administrative Agent shall have been notified in
writing by any Lender prior to a borrowing that such Lender will not make its
share of such borrowing available to the Administrative Agent, the
Administrative Agent may assume that such Lender is making such amount
available to the Administrative Agent, and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower a corresponding
amount. If such amount is not made available to the Administrative Agent by
the required time on the Borrowing Date therefor, such Lender shall pay to
the Administrative Agent, on demand, such amount with interest thereon at a
rate equal to the daily average Federal Funds Effective Rate for the period
until such Lender makes such amount immediately available to the
Administrative Agent. A certificate of the Administrative Agent submitted to
any Lender with respect to any amounts owing under this Section 2.10(b) shall
be conclusive in the absence of manifest error. If such Lender's share of
such borrowing is not made available to the Administrative Agent by such
Lender within three Business Days of such Borrowing Date, the Administrative
Agent shall also be entitled to recover such amount with interest thereon at
the rate as set forth above on demand from the Borrower.
(k) Increased Costs, Illegality, etc. (a) If, due to either (i) the
introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request hereafter
adopted, promulgated or made by any central bank or other governmental
authority (whether or not having the force of law), there shall be any
increase in the cost to any Lender of agreeing to make or making, funding or
maintaining Loans, then the Borrower shall from time to time, upon demand by
such Lender (with a copy of such demand to the Administrative Agent but
subject to the terms of Section 2.14), pay (with funds provided by the Lessee
as Supplemental Rent pursuant to Section 3.3 of the Lease) to the
Administrative Agent for the account of such Lender additional amounts
sufficient to compensate such Lender for such increased cost. A certificate
as to the amount of such increased cost, submitted to the Borrower and the
Administrative Agent by such Lender, shall be conclusive and binding for all
purposes, absent manifest error.
(b) If any Lender determines that compliance with any law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law, but in each
case promulgated or made after the date hereof) affects or would affect the
amount of capital required or expected to be maintained by such Lender or any
corporation controlling such Lender and that the amount of such capital is
increased by or based upon the existence of such Lender's commitment to lend
hereunder and other commitments of this type or upon the Loans, then, upon
demand by such Lender (with a copy of such demand to the Administrative Agent
but subject to the terms of Section 2.14), the Borrower shall pay (with funds
provided by the Lessee as Supplemental Rent pursuant to Section 3.3 of the
Lease) to the Administrative Agent for the account of such Lender, from time
to time as specified by such Lender, additional amounts sufficient to
compensate such Lender or such corporation in the light of such
circumstances, to the extent that such Lender reasonably determines such
increase in capital to be allocable to the existence of such Lender's
commitment to lend hereunder or upon the Loans. A certificate as to such
amounts submitted to the Borrower and the Administrative Agent by such Lender
shall be conclusive and binding for all purposes, absent manifest error.
(c) Without limiting the effect of the foregoing, the Borrower shall
pay to each Lender on the last day of the Interest Period therefor so long as
such Lender is maintaining reserves against "Eurocurrency liabilities" under
Regulation D an additional amount (determined by such Lender and notified to
the Borrower through the Administrative Agent) equal to the product of the
following for each Eurodollar Loan for each day during such Interest Period:
(i) the principal amount of such Eurodollar Loan
outstanding on such day; and
(ii) the remainder of (x) a fraction the numerator of which
is the rate (expressed as a decimal) at which interest accrues on
such Eurodollar Loan for such Interest Period as provided in this
Credit Agreement (less the Applicable Percentage) and the
denominator of which is one minus the effective rate (expressed as a
decimal) at which such reserve requirements are imposed on such
Lender on such day minus (y) such numerator; and
(iii) 1/360.
(d) Without affecting its rights under Section 2.11(a) or 2.11(b) or
any other provision of this Agreement, each Lender agrees that if there is any
increase in any cost to or reduction in any amount receivable by such Lender
with respect to which the Borrower would be obligated to compensate such
Lender pursuant to Sections 2.11(a) or 2.11(b), such Lender shall use
reasonable efforts to select an alternative lending office which would not
result in any such increase in any cost to or reduction in any amount
receivable by such Lender; provided, however, that no Lender shall be
obligated to select an alternative lending office if such Lender determines
that (i) as a result of such selection such Lender would be in violation of
any applicable law, regulation, treaty, or guideline, or would incur
additional costs or expenses or (ii) such selection would be inadvisable
for regulatory reasons or inconsistent with the interests of such Lender.
(e) Notwithstanding any other provision of this Agreement, if any
Lender shall notify the Administrative Agent that the introduction of or any
change in or in the interpretation of any law or regulation makes it unlawful,
or any central bank or other governmental authority asserts that it is unlawful,
for any Lender to perform its obligations hereunder to make or maintain
Eurodollar Loans, then (i) each Eurodollar Loan will automatically, at the
earlier of the end of the Interest Period for such Eurodollar Loan or the
date required by law, convert into an ABR Loan and (iii) the obligation of
the Lenders to make, convert or continue Eurodollar Loans shall be suspended
until the Administrative Agent shall notify the Borrower that such Lender has
determined that the circumstances causing such suspension no longer exist.
(l) Funding Indemnity. Subject to the provisions of Section 2.14(a),
the Borrower agrees to indemnify (with funds provided by the Lessee as
Supplemental Rent under the Lease or by the Lessee or the Construction Agent
under Section 13 of the Participation Agreement except to the extent such
event is not subject to indemnity by the Lessee under the Participation
Agreement) each Lender and to hold each Lender harmless from any loss or
reasonable expense which such Lender may sustain or incur as a consequence of
default by the Borrower in making a borrowing of any Loan hereunder after the
Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement, default by the Borrower in making any
prepayment after the Borrower has given a notice thereof in accordance with
the provisions of this Agreement or the making of a voluntary or involuntary
payment or prepayment of Eurodollar Loans on a day which is not the last day
of an Interest Period with respect thereto. Such indemnification shall be in
an amount equal to the excess, if any, of the amount of interest which would
have accrued on the amount so prepaid, or not so borrowed, converted or
continued for the period from the date of such prepayment or of such failure
to borrow, convert or continue to the last day of such Interest Period (or,
in the case of a failure to borrow, convert or continue, the Interest Period
that would have commenced on the date of such failure) in each case at the
applicable Eurodollar Rate for such Loan for such Interest Period over the
amount of interest (as determined by such Lender) which would have accrued to
such Lender on such amount by reemploying such funds in loans of the same
type and amount during the period from the date of prepayment or failure to
borrow to the last day of the then applicable Interest Period (or, in the
case of a failure to borrow, the Interest Period that would have commenced on
the date of such failure). This covenant shall survive the termination of
this Agreement and the payment of all other amounts payable hereunder.
(m) Taxes. All payments made by the Borrower under this Agreement
and the Notes shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp or
other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any Governmental Authority, excluding net income taxes and
franchise taxes (imposed in lieu of net income taxes) imposed on the
Administrative Agent or any Lender as a result of a present or former
connection between the Administrative Agent or such Lender and the
jurisdiction of the Governmental Authority imposing such tax or any
political subdivision or taxing authority thereof or therein (other than any
such connection arising solely from the Administrative Agent or such Lender
having executed, delivered or performed its obligations or received a payment
under, or enforced, this Agreement or the Notes). If any such non-excluded
taxes, levies, imposts, duties, charges, fees, deductions or withholdings
("Non-Excluded Taxes") are required to be withheld from any amounts payable to
the Administrative Agent or any Lender hereunder or under the Notes, the
amounts so payable to the Administrative Agent or such Lender shall be
increased to the extent necessary to yield to the Administrative Agent or
such Lender (after payment of all Non-Excluded Taxes) interest or any such
other amounts payable hereunder at the rates or in the amounts specified in
this Agreement and the Notes, provided, however, that the foregoing
obligations of the Borrower shall not apply:
(i) to any payment to any Lender hereunder unless such Lender
is, on the date hereof (or on the date it becomes a Lender hereunder as
provided in Section 9.8 hereof) and on the date of any change in the Lending
Office of such Lender, either entitled to submit a Form 1001 (relating to
such Lender and entitling it to a complete exemption from withholding on all
interest to be received by it hereunder in respect of the Loans) or Form 4224
(relating to all interest to be received by such Lender hereunder in respect
of the Loans), or
(ii) to any U.S. Taxes imposed solely by reason of the failure by
a non-U.S. Person to comply with applicable certification, information,
documentation or other reporting requirements concerning the nationality,
residence, identity or connections with the United States of America of such
non-U.S. Person if such compliance is required by statute or regulation of the
United States of America as a precondition to relief or exemption from such
U.S. Taxes.
For the purposes of this Section 2.13(a), (A) "U.S. Person" shall mean a
citizen, national or resident of the United States of America, a corporation,
partnership or other entity created or organized in or under any laws of the
United States of America or any State thereof, or any estate or trust that is
subject to Federal income taxation regardless of the source of its income,
(B) "U.S. Taxes" shall mean any present or future tax, assessment or other
charge or levy imposed by or on behalf of the United States of America or
any taxing authority thereof or therein, (C) "Form 1001" shall mean Form 1001
(Ownership, Exemption, or Reduced Rate Certificate) of the Department of the
Treasury of the United States of America and (D) "Form 4224" shall mean Form
4224 (Exemption from Withholding of Tax on Income Effectively Connected with
the Conduct of a Trade or Business in the United States) of the Department of
Treasury of the United States of America (or in relation to either such Form
such successor and related forms as may from time to time be adopted by the
relevant taxing authorities of the United States of America to document a
claim to which such Form relates). Each of the Forms referred to in the
foregoing clauses (C) and (D) shall include such successor and related forms
as may from time to time be adopted by the relevant taxing authorities of the
United States of America to document a claim to which such Form relates.
(b) Within 30 days after paying any amount to the Administrative Agent
or any Lender from which it is required by law to make any deduction or
withholding, and within 30 days after it is required by law to remit such
eduction or withholding to any relevant taxing or authority, the Borrower
shall deliver to the Administrative Agent for delivery to such non-U.S.
Person evidence satisfactory to such Person of such deduction, withholding
or payment (as the case may be).
(c) If a Lender or an affiliate with whom such Lender files a
consolidated tax return (or equivalent) subsequently receives the benefit in
any country of a tax credit or an allowance resulting from U.S. Taxes with
respect to which it has received a payment of an additional amount under this
Section 2.13, such Lender will pay to the Borrower such part of that benefit
as in the opinion of such Lender will leave it (after such payment) in a
position no more and no less favorable than it would have been in if no
additional payment had been required to be paid, provided always that (i)
such Lender will be the sole judge of the amount of any such benefit and of
the date on which it is received, (ii) such Lender will have the absolute
discretion as to the order and manner in which it employs or claims tax
credits and allowances available to it and (iii) such Lender will not be
obliged to disclose to the Borrower any information regarding its tax
affairs or tax computations.
(d) Each non-U.S. Person that shall become a Participant pursuant to
Section 9.7 or a Lender pursuant to Section 9.8 shall, upon the effectiveness
of the related transfer, be required to provide all of the forms and statements
referenced under subsection 2.13(a)(i), provided that in the case of a
Participant such Participant shall furnish all such required forms and
statements to the Lender from which the related participation shall have been
purchased.
(n) Notice of Amounts Payable; Mandatory Assignment. (a) Notice.
In the event that any Lender becomes aware that any amounts are or will be
owed to it pursuant to Section 2.11, 2.12 or 2.13 or that it is unable to
make Eurodollar Loans, then it shall promptly notify the Borrower and the
Administrative Agent thereof and, as soon as possible thereafter, such Lender
shall submit to the Borrower (with a copy to the Administrative Agent) a
certificate indicating the amount owing to it and the calculation thereof.
The amounts set forth in such certificate shall be prima facie evidence of
the obligations of the Borrower hereunder. If any Lender receives a refund
or realizes a return of any of the amounts charged by such Lender pursuant to
Section 2.11, such Lender shall promptly credit such amounts to the Borrower.
(b) Mandatory Assignment. In the event that any Lender delivers to
the Borrower a certificate in accordance with Section 2.14(a) in connection
with amounts payable pursuant to Section 2.11 or Section 2.13 or such Lender
is required to make Loans as ABR Loans in accordance with Section 2.11(d)
then, subject to Section 11.1 of the Participation Agreement, the Borrower
may, at its own expense and in its sole discretion, (i) require such Lender
to transfer or assign, in whole or (with such Lender's consent) in part,
without recourse (in accordance with Section 9.8), all or (with such Lender's
consent) part of its interests, rights (except for rights to be indemnified
for actions taken while a party hereunder) and obligations under this
Agreement to a replacement bank or institution if the Borrower (subject to
Section 11.1 of the Participation Agreement), with the full cooperation of
such Lender, can identify a Person who is ready, willing and able to be such
replacement bank or institution with respect thereto and such replacement
bank or institution (which may be another Lender) shall assume such assigned
obligations, or (ii) during such time as no Default or Event of Default has
occurred and is continuing, terminate the Commitment of such Lender and
prepay all outstanding Loans and such Lender; provided, however, that (x)
subject to Section 11.1 of the Participation Agreement, the Borrower or such
replacement bank or institution, as the case may be, shall have paid to such
Lender in immediately available funds the principal of and interest accrued
to the date of such payment on the Loans made by it hereunder and all other
amounts owed to it hereunder (and, if such Lender is also a Holder, all
Holder Fundings and Holder Yield accrued and unpaid thereon), (y) any
termination of Commitments shall be subject to the terms of Section 2.5(a)
and (z) such assignment or termination of the Commitment of such Lender and
prepayment of Loans does not conflict with any law, rule or regulation or
order of any court or Governmental Authority.
SECTION III. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this
Agreement and to make the Loans, each of the Trust Company and the Owner
Trustee hereby represents and warrants to the Administrative Agent and each
Lender as follows (provided that the representations in Sections 3.8, 3.9.
3.10, 3.12 and 3.13 are made solely by the Owner Trustee in its capacity as
such):
(a) Due Organization, etc. It is a national banking association
duly organized and validly existing and in good standing under the laws of
the United States of America and has the power and authority to enter into
and perform its obligations under the Trust Agreement and (assuming due
authorization, execution and delivery of the Trust Agreement by the Holder)
has the corporate and trust power and authority to act as the Owner Trustee
and to enter into and perform the obligations under each of the other
Operative Agreements to which the Trust Company or the Owner Trustee, as the
case may be, is or will be a party and each other agreement, instrument and
document to be executed and delivered by it on or before the date this
representation is made or deemed made in connection with or as contemplated
by each such Operative Agreement to which the Trust Company or the Owner
Trustee, as the case may be, is or will be a party.
(b) Authorization; No Conflict. The execution, delivery and
performance of each Operative Agreement to which it is or will be a party,
either in its individual capacity or (assuming due authorization, execution
and delivery of the Trust Agreement by the Holder) as the Owner Trustee, as
the case may be, has been duly authorized by all necessary action on its part
and neither the execution and delivery thereof, nor the consummation of the
transactions contemplated thereby, nor compliance by it with any of the terms
and provisions thereof does or will require any approval or consent of any
trustee or holders of any of its indebtedness or obligations, does or will
contravene any current law, governmental rule or regulation relating to its
banking or trust powers, does or will contravene or result in any breach of
or constitute any default under, or result in the creation of any Lien upon
any of its property under, its charter or by-laws, or any indenture,
mortgage, chattel mortgage, deed of trust, conditional sales contract, bank
loan or credit agreement or other agreement or instrument to which it is a
party or by which it or its properties may be bound or affected (other than
as contemplated by the Operative Agreements) which contravention, breach,
default or Lien under clause (ii) would materially and adversely affect its
ability, in its individual capacity or as Owner Trustee, to perform its
obligations under the Operative Agreements to which it is a party or does or
will require any Governmental Action by any Governmental Authority regulating
its banking or trust powers.
(c) Enforceability, Etc. The Trust Agreement and, assuming the Trust
Agreement is the legal, valid and binding obligation of the Holder, each other
Operative Agreement to which the Trust Company or the Owner Trustee, as the
case may be, is or will be party have been, or on or before the date this
representation is made or deemed made will be, duly executed and delivered by
the Trust Company or the Owner Trustee, as the case may be, and the Trust
Agreement and each such other Operative Agreement to which the Trust Company
or the Owner Trustee, as the case may be, is a party constitutes, or upon
execution and delivery will constitute, a legal, valid and binding obligation
enforceable against the Trust Company or the Owner Trustee, as the case may be,
in accordance with the terms thereof.
(d) Litigation. There is no action or proceeding pending or, to its
knowledge, threatened to which it is or will be a party, either in its
individual capacity or as the Owner Trustee, before any Governmental
Authority that concerns the Facility or Construction Funding being funded on
the date this representation is made or deemed made or that, if adversely
determined, would materially and adversely affect its ability, in its
individual capacity or as Owner Trustee, to perform its obligations under
the Operative Agreements to which it is a party or would question the
validity or enforceability of any of the Operative Agreements to which it is
or will become a party.
(e) Lessor Liens. The Facility is free and clear of all Lessor Liens
attributable to it in its individual capacity.
(f) Assignment. It has not assigned or transferred any of its right,
title or interest in or under the Lease, the Agency Agreement or its interest
in the Facility or any portion thereof, except as provided in the Operative
Agreements.
(g) Defaults. No Default or Event of Default under any Operative
Agreement attributable to it has occurred and is continuing.
(h) Documentation. The Owner Trustee, in its trust capacity, is a
party to no documents, instruments or agreements other than those Operative
Agreements (and any other documents delivered in connection with the
Operative Agreements).
(i) Use of Proceeds. The proceeds of the Loans shall be applied by
the Owner Trustee solely in accordance with the terms of the Operative
Agreements.
(j) Securities Act. Neither the Owner Trustee nor any Person
authorized by the Owner Trustee to act on its behalf has offered or sold any
interest in the Trust Estate or the Notes, or in any similar security
relating to the Facility, or in any security the offering of which for the
purposes of the Securities Act of 1933, as amended, would be deemed to be
part of the same offering as the offering of the aforementioned securities
to, or solicited any offer to acquire any of the same from, any Person other
than in the case of the Notes, the Lenders, and neither the Owner Trustee nor
any Person authorized by the Owner Trustee to act on its behalf will take
any action which would subject, as a direct result of such action alone, the
issuance or sale of any interest in the Trust Estate or the Notes to the
provisions of Section 5 of the Securities Act of 1933, as amended, or require
the qualification of any Operative Agreement under the Trust Indenture Act of
1939, as amended.
(k) Chief Place of Business. The Owner Trustee's chief place of
business, chief executive office and office where the documents, accounts and
records relating to the transactions contemplated by this Agreement and each
other Operative Agreement are kept are each located at 79 South Main Street,
Salt Lake City, Utah 84111.
(l) Federal Reserve Regulations. The Owner Trustee is not engaged
principally in, and does not have as one of its important activities, the
business of extending credit for the purpose of purchasing or carrying any
margin stock (within the meaning of Regulation U of the Board), and no part
of the proceeds of the Loans will be used by it to purchase or carry any
margin stock or to extend credit to others for the purpose of purchasing or
carrying any such margin stock or for any purpose that violates, or is
inconsistent with, the provisions of Regulations G, T, U or X of the Board.
(m) Investment Company Act. The Owner Trustee is not an "investment
company" or a company controlled by an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
SECTION IV. CONDITIONS PRECEDENT
(a) Conditions to Effectiveness. The effectiveness of this Agreement
is subject to the satisfaction of all conditions precedent set forth in Section
6 of the Participation Agreement required by said Section to be satisfied on or
prior to the Initial Closing Date.
(b) Conditions to Each Loan. The agreement of each Lender to make
any Loan requested to be made by it on any date is subject to the
satisfaction of the following conditions precedent:
Representations and Warranties. Each of the representations and
warranties made by the Borrower in or pursuant to the Operative Agreements
shall be true and correct in all material respects on and as of such date as
if made on and as of such date.
No Default. No Default or Event of Default shall have occurred
and be continuing on such date or after giving effect to the Loans requested
to be made on such date.
Participation Agreement Conditions. With respect to each
Acquisition Loan Funding and each Construction Loan Funding, the applicable
conditions precedent to the Funding associated therewith specified in Section
5 of the Participation Agreement shall have been satisfied.
Holder Contribution. With respect to each Acquisition Loan
Funding and each Construction Loan Funding, the Administrative Agent shall be
satisfied that the Lessor shall receive from the Holder on the relevant
Borrowing Date an amount equal to the Holder Fundings associated with such
Loan.
Each borrowing by the Borrower hereunder shall constitute a representation and
warranty by the Borrower as of the date of such Loan that the conditions
contained in this Section 4.2 have been satisfied.
SECTION V. COVENANTS
So long as any Loan or Note remains outstanding and unpaid or any
other amount is owing to any Lender or the Administrative Agent hereunder:
(a) Other Activities. The Borrower shall not conduct, transact or
otherwise engage in, or commit to transact, conduct or otherwise engage in,
any business or operations other than the entry into, and exercise of rights
and performance of obligations in respect of, the Operative Agreements and
other activities incidental or related to the foregoing.
(b) Ownership of the Facility, Indebtedness. The Borrower shall not
own, lease, manage or otherwise operate any properties or assets other than
in connection with the activities described in Section 5.1, or incur, create,
assume or suffer to exist any Indebtedness or other consensual liabilities or
financial obligations other than as may be incurred, created or assumed or as
may exist in connection with the activities described in Section 5.1
(including, without limitation, the Loans and other obligations incurred by
the Borrower hereunder).
(c) Disposition of Assets. The Borrower shall not convey, sell,
lease, assign, transfer or otherwise dispose of any of its property, business
or assets, whether now owned or hereafter acquired, except to the extent
expressly contemplated by the Operative Agreements.
(d) Compliance with Operative Agreements. The Borrower shall at all
times observe and perform all of the covenants, conditions and obligations
required to be performed by it (whether in its capacity as Lessor, Owner
Trustee or otherwise) under each Operative Agreement to which it is a party
and (b) observe and perform, or cause to be observed and performed, all of the
covenants, conditions and obligations of the Lessor under the Lease, even in
the event that the Lease is terminated at stated expiration following a
Lease Event of Default or otherwise.
(e) Further Assurances. At any time and from time to time, upon the
written request of the Administrative Agent, and at the sole expense of the
Borrower, the Borrower will promptly and duly execute and deliver such
further instruments and documents and take such further action as the
Administrative Agent or the Majority Lenders may reasonably request for the
purpose of obtaining or preserving the full benefits of this Agreement and
the other Operative Agreements and of the rights and powers herein or therein
granted.
(f) Notices. If on any date, a Responsible Officer of the Borrower
shall obtain actual knowledge of the occurrence of a Default or Event of
Default, the Borrower will give written notice thereof to the Administrative
Agent within five Business Days after such date.
(g) Discharge of Liens. Neither the Borrower nor the Trust Company
will create or permit to exist at any time, and will, at its own expense,
promptly take such action as may be necessary duly to discharge, or cause to
be discharged, all Lessor Liens attributable to it, provided, that the
Borrower and the Trust Company shall not be required to discharge any Lessor
Lien while the same is being contested in good faith by appropriate
proceedings diligently prosecuted so long as such proceedings shall not
involve any material danger of impairment of any of the Liens contemplated by
the Security Documents or of the sale, forfeiture or loss of, and shall not
materially interfere with the disposition of, the Facility or title thereto
or any interest therein or the payment of Rent.
(h) Trust Agreement. Without prejudice to any right under the Trust
Agreement of the Owner Trustee to resign, the Owner Trustee (a) agrees not to
terminate or revoke the trust created by the Trust Agreement except as
permitted by Article VIII of the Trust Agreement, (b) agrees not to amend,
supplement, terminate, revoke or otherwise modify any provision of the Trust
Agreement in any manner which could reasonably be expected to have an
adverse effect on the rights or interests of the Administrative Agent or the
Lenders hereunder or under the other Operative Agreements and (c) agrees to
comply with all of the terms of the Trust Agreement.
SECTION VI. EVENTS OF DEFAULT
Upon the occurrence of any of the following specified events (each an
"Event of Default"):
The Borrower shall (i) default in the payment when due of any
principal of the Loans or (ii) except as provided in paragraph (c), default
in the payment when due of any interest on the Loans and such default shall
continue for one (1) Business Day or longer; or
Except as provided in paragraphs (a) and (c), the Borrower shall
default in the payment of any amount owing under any Credit Document and such
default shall continue for three (3) Business Days or longer; or
The Borrower shall default in the payment of any amount due on
the Maturity Date owing under any Credit Document; or
The Borrower shall default in the due performance or observance
by it of any term, covenant or agreement contained in any Credit Document to
which it is a party (other than those referred to in paragraphs (a), (b) and
(c) above), provided, that in the case of any such default under Section 5.4,
5.5 or 5.8(c), such default shall have continued unremedied for a period of
at least thirty (30) days after notice to the Borrower by the Administrative
Agent or the Majority Lenders; or
Any representation, warranty or statement made or deemed made by
the Borrower herein or in any other Credit Document or by the Borrower or the
Lessee in the Participation Agreement, or in any statement or certificate
delivered or required to be delivered pursuant hereto or thereto, shall
prove to be untrue in any material adverse respect on the date as of which
made or deemed made; or
(i) Any Lease Event of Default shall have occurred and be
continuing, or (ii) the Owner Trustee shall default in the due performance or
observance by it of any term, covenant or agreement contained in the
Participation Agreement or in the Trust Agreement to or for the benefit of
the Administrative Agent or a Lender, provided, that in the case of this
clause (ii) such default shall have continued unremedied for a period of at
least thirty (30) days after notice to the Owner Trustee by the
Administrative Agent or the Majority Lenders; or
The Borrower shall commence a voluntary case concerning itself
under Title 11 of the U.S. Code entitled "Bankruptcy", as now or hereafter
in effect, or any successor thereto (the "Bankruptcy Code"); or an
involuntary case is commenced against the Borrower and the petition is not
contravened within 10 days after commencement of the case or an involuntary
case is commenced against the Borrower and the petition is not dismissed
within sixty (60) days after commencement of the case; or a custodian (as
defined in the Bankruptcy Code) is appointed for, or takes charge of, all
or substantially all of the property of the Borrower; or the Borrower
commences any other proceeding under any reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or
liquidation or similar law of any jurisdiction whether now or hereafter in
effect relating to the Borrower, or there is commenced against the Borrower
any such proceeding which remains undismissed for a period of sixty (60)
days; or the Borrower is adjudicated insolvent or bankrupt, or any order of
relief or other order approving any such case or proceeding is entered; or
the Borrower suffers any appointment of any custodian or the like for it or
any substantial part of its property to continue undischarged or unstayed
for a period of sixty (60) days; or the Borrower makes a general assignment
for the benefit of creditors; or any corporate or partnership action is taken
by the Borrower for the purpose of effecting any of the foregoing; or
Any Security Document shall cease to be in full force and effect,
or shall cease to give the Administrative Agent the Liens, rights, powers and
privileges purported to be created thereby in favor of the Administrative
Agent on behalf of the Lenders, superior to and prior to the rights of all
third Persons and subject to no other Liens (except in each case to the
extent expressly permitted herein or in any Operative Agreement) other than
the Ground Lease; or
The Lease shall cease to be enforceable against the Lessee; or
One or more judgments or decrees shall be entered against the
Borrower involving a liability of $50,000 or more in the case of any one such
judgment or $100,000 or more in the aggregate for all such judgments and
decrees for the Borrower and any such judgments or decrees shall not have
been vacated, discharged or stayed or bonded pending appeal within thirty
(30) days from the entry thereof.
then, and in any such event, (A) if such event is an Event of Default specified
in paragraph (g) above with respect to the Borrower, automatically the
Commitments shall immediately terminate and the Loans hereunder (with
accrued interest thereon) and all other amounts owing under this Agreement and
the Notes shall immediately become due and payable, and (B) if such event is
any other Event of Default, either or both of the following actions may be
taken: (i) with the consent of the Majority Lenders, the Administrative
Agent may, or upon the request of the Majority Lenders, the Administrative
Agent shall, by notice to the Borrower declare the Commitments to be
terminated forthwith, whereupon the Commitments shall immediately terminate;
and (ii) with the consent of the Majority Lenders, the Administrative Agent
may, or upon the request of the Majority Lenders, the Administrative Agent
shall, by notice to the Borrower, declare the Loans hereunder (with accrued
interest thereon) and all other amounts owing under this Agreement and the
Notes to be due and payable forthwith, whereupon the same shall immediately
become due and payable (any of the foregoing occurrences or actions referred
to in clause (A) or (B) above, an "Acceleration"). Except as expressly
provided above in this Section 6, presentment, demand, protest and all other
notices of any kind are hereby expressly waived.
Upon the occurrence of any Event of Default and at any time thereafter
so long as any Event of Default shall be continuing, the Administrative Agent
shall, upon the written instructions of the Majority Lenders, exercise any or
all of the rights and powers and pursue any and all of the remedies available
to it hereunder and (subject to the terms thereof) under the other Credit
Documents, the Lease and the other Operative Agreements and shall have any
and all rights and remedies available under the Uniform Commercial Code or
any provision of law.
Upon the occurrence of any Event of Default and at any time thereafter
so long as any Event of Default shall be continuing, the Administrative Agent
may, and upon request of the Majority Lenders shall, proceed to protect and
enforce this Agreement, the Notes, the other Credit Documents and the Lease
by suit or suits or proceedings in equity, at law or in bankruptcy, and
whether for the specific performance of any covenant or agreement herein
contained or in execution or aid of any power herein granted, or for
foreclosure hereunder, or for the appointment of a receiver or receivers
for the Facility or for the recovery of judgment for the indebtedness secured
thereby or for the enforcement of any other proper, legal or equitable remedy
available under applicable laws.
The Borrower shall be liable for any and all accrued and unpaid
amounts due hereunder before, after or during the exercise of any of the
foregoing remedies, including all reasonable legal fees and other reasonable
costs and expenses incurred by the Administrative Agent or any Lender by
reason of the occurrence of any Event of Default or the exercise of remedies
with respect thereto.
SECTION VII. THE ADMINISTRATIVE AGENT
(a) Appointment. Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Operative Agreements, and each such Lender
irrevocably authorizes the Administrative Agent, in such capacity, to
execute the Operative Agreements as agent for and on behalf of such Lender,
to take such action on behalf of such Lender under the provisions of this
Agreement and the other Operative Agreements and to exercise such powers and
perform such duties as are expressly delegated to the Administrative
Agent by the terms of this Agreement and other Operative Agreements, together
with such other powers as are reasonably incidental thereto. Without
limiting the generality of the foregoing, each of the Lenders hereby
specifically acknowledges the terms and provisions of the Participation
Agreement and directs the Administrative Agent to exercise such powers, make
such decisions and otherwise perform such duties as are delegated to the
Administrative Agent thereunder without being required to obtain any
specific consent with respect thereto from any Lender. Notwithstanding any
provision to the contrary elsewhere in this Agreement, the Administrative
Agent shall not have any duties or responsibilities, except those expressly
set forth herein, or any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Operative
Agreement or otherwise exist against the Administrative Agent.
(b) Delegation of Duties. The Administrative Agent may execute any
of its duties under this Agreement and the other Operative Agreements by or
through agents or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Administrative
Agent shall not be responsible for the negligence or misconduct of any agents
or attorneys-in-fact selected by it with reasonable care.
(c) Exculpatory Provisions. Neither the Administrative Agent nor any
of its officers, directors, employees, agents, attorneys-in-fact or Affiliates
shall be (a) liable for any action lawfully taken or omitted to be taken by it
or such Person under or in connection with this Agreement or any other
Operative Agreement (except for its or such Person's own gross negligence or
willful misconduct) or (b) responsible in any manner to any of the Lenders
for any recitals, statements, representations or warranties made by the
Borrower or the Lessee or any officer thereof contained in this Agreement or
any other Operative Agreement or in any certificate, report, statement or other
document referred to or provided for in, or received by the Administrative
Agent under or in connection with, this Agreement or any other Operative
Agreement or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Operative
Agreement or for any failure of the Borrower or the Lessee to perform its
obligations hereunder or thereunder. The Administrative Agent shall not be
under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Operative Agreement, or to inspect
the properties, books or records of the Borrower or the Lessee.
(d) Reliance by Administrative Agent. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any Note,
writing, resolution, notice, consent, certificate, affidavit, letter,
telecopy, telex or teletype message, statement, order or other document
or conversation believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to the
Borrower or the Lessee), independent accountants and other experts selected
by the Administrative Agent. The Administrative Agent may deem and treat the
payee of any Note as the owner thereof for all purposes unless a written
notice of assignment, negotiation or transfer thereof shall have been filed
with the Administrative Agent. The Administrative Agent shall be fully
justified in failing or refusing to take any action under this Agreement or
any other Operative Agreement unless it shall first receive such advice or
concurrence of the Majority Lenders as it deems appropriate or it shall first
be indemnified to its satisfaction by the Lenders against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Administrative Agent shall in all
cases be fully protected in acting, or in refraining from acting, under this
Agreement and the other Operative Agreements in accordance with a request of
the Majority Lenders, and such and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders
of the Notes.
(e) Notice of Default. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has received written notice
from a Lender or the Borrower referring to this Agreement, describing such
Default or Event of Default and stating that such notice is a "notice of
default". In the event that the Administrative Agent receives such a notice,
the Administrative Agent shall give notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Majority Lenders;
provided that unless and until the Administrative Agent shall have received
such directions, the Administrative Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable in the best interests of
the Lenders.
(f) Non-Reliance on Administrative Agent and Other Lenders. Each
Lender expressly acknowledges that neither the Administrative Agent nor any
of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act
by the Administrative Agent hereinafter taken, including any review of the
affairs of the Borrower or the Lessee, shall be deemed to constitute any
representation or warranty by the Administrative Agent to any Lender. Each
Lender represents to the Administrative Agent that it has, independently and
without reliance upon the Administrative Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Borrower and the
Lessee and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon the Administrative Agent or any other Lender, and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking
or not taking action under this Agreement and the other Operative Agreements,
and to make such investigation as it deems necessary to inform itself as to
the business, operations, property, financial and other condition and
creditworthiness of the Borrower and the Lessee. Except for notices, reports
and other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of the Borrower
or the Lessee which may come into the possession of the Administrative Agent
or any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
(g) Indemnification. The Lenders agree to indemnify the
Administrative Agent, in its capacity as such (to the extent not reimbursed
by the Borrower and without limiting the obligation of the Borrower to do so),
ratably according to their respective Commitment Percentages in effect on the
date on which indemnification is sought under this Section 7.7 (or, if
indemnification is sought after the date upon which the Commitments shall
have terminated and the Loans shall have been paid in full, ratably in
accordance with their Commitment Percentages immediately prior to such date),
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind whatsoever which may at any time (including, without limitation, at any
time following the payment of the Notes) be imposed on, incurred by or
asserted against any of them in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Operative Agreements or any
documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted
by any of them under or in connection with any of the foregoing; provided
that no Lender shall be liable for the payment or any portion of such
liabilities, obligations, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting solely from the gross negligence or
willful misconduct of the Administrative Agent. The agreements in this
Section 7.7 shall survive the payment of the Notes and all other amounts
payable hereunder.
(h) Administrative Agent in Its Individual Capacity. The
Administrative Agent and its Affiliates may make loans to, accept deposits
from and generally engage in any kind of business with the Borrower or the
Lessee as though the Administrative Agent were not the Administrative Agent
hereunder and under the other Operative Agreements. With respect to its
Loans made or renewed by it and any Note issued to it, the Administrative
Agent shall have the same rights and powers under this Agreement and the
other Operative Agreements as any Lender and may exercise the same as though
it were not the Administrative Agent, and the terms "Lender" and "Lenders"
shall include the Administrative Agent in its individual capacity.
(i) Successor Administrative Agent. The Administrative Agent may
resign at any time as Administrative Agent upon thirty days' notice to the
Lenders, the Borrower and, so long as no Lease Event of Default shall have
occurred and be continuing, the Lessee and may be removed at any time with
cause by the Majority Lenders (which for purposes of this Section 7.9 shall not
include the Holder). If the Administrative Agent shall resign or be removed as
Administrative Agent under this Agreement, the Majority Lenders shall appoint
from among the Lenders a successor Administrative Agent which successor
Administrative Agent shall be subject to the approval of the Borrower and,
so long as no Lease Event of Default shall have occurred and be continuing, the
Lessee, such approval not to be unreasonably withheld or delayed. If no
successor Administrative Agent is appointed prior to the effective date of
the resignation or removal of the retiring Administrative Agent, the
Administrative Agent may appoint, after consulting with the Lenders and
subject to the approval of the Borrower and, so long as no Lease Event of
Default shall have occurred and be continuing, the Lessee, such approval not
to be unreasonably withheld or delayed, a successor Administrative Agent from
among the Lenders. If no successor Administrative Agent has accepted
appointment as Administrative Agent by the date which is thirty days
following a retiring Administrative Agent's notice of resignation or removal,
the retiring agent's notice of resignation or removal shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties
of Administrative Agent until such time, if any, as the Majority Lenders
appoint a successor Administrative Agent, as provided for above. Upon the
effective date of such resignation or removal, only such successor
Administrative Agent shall succeed to all the rights, powers and duties of
the retiring Administrative Agent and the term "Administrative Agent" shall
mean such successor agent and the retiring Administrative Agent's rights,
powers and duties in such capacity shall be terminated. After any retiring
Administrative Agent resigns or is removed hereunder as Administrative Agent,
the provisions of this Article VII and Section 9.5 shall inure to their
respective benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement.
(j) Actions of Administrative Agent on Behalf of Holder. The parties
hereto specifically acknowledge and consent to the Administrative Agent's
acting on behalf of the Holder as provided in the Participation Agreement,
and, in any such case, the Lenders acknowledge that the Holder shall be
entitled to vote as "Lenders" hereunder to the extent required or permitted by
the Operative Agreements (including specifically without limitation Section
10.6 of the Participation Agreement).
(k) The Administrative Agent's Duty of Care. Other than the exercise
of reasonable care to assure the safe custody of the Collateral while being
held by the Administrative Agent hereunder or under any other Operative
Agreement, the Administrative Agent shall have no duty or liability to
preserve rights pertaining thereto, it being understood and agreed that the
Lessee shall be responsible for preservation of all rights in the Collateral,
and the Administrative Agent shall be relieved of all responsibility for the
Collateral upon surrendering it or tendering the surrender of it to the
Lessee. The Administrative Agent shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral in its
possession if the Collateral is accorded treatment substantially equal to
that which the Administrative Agent accords its own property, which shall be
no less than the treatment employed by a reasonable and prudent agent in the
industry, it being understood that the Administrative Agent shall not have
responsibility for taking any necessary steps to preserve rights against any
parties with respect to any of the Collateral.
SECTION VIII. MATTERS RELATING TO PAYMENTS AND COLLATERAL
(a) Collection and Allocation of Payments and Other Amounts. The
Lessee, the Construction Agent, the Administrative Agent, the Lenders, the
Holder and the Borrower have agreed pursuant to the terms of Section 10.7 of
the Participation Agreement to a procedure for the allocation and
distribution of certain payments and distributions, including without
limitation the proceeds of Collateral.
(b) Certain Remedial Matters. Notwithstanding any other provision of
this Agreement or any other Credit Document:
the Borrower shall at all times retain all rights to Holder Excepted
Payments payable to it and to demand, collect or commence an action at law to
obtain such payments and to enforce any judgment with respect thereto; and
the Borrower and the Holder shall at all times retain the right, but
not to the exclusion of the Administrative Agent, (A) to receive from the
Lessee all notices, certificates and other documents and all information that
the Lessee is permitted or required to give or furnish to the "Borrower" or
the "Lessor" pursuant to the Lease, the Participation Agreement or any other
Operative Agreement, (B) to retain all rights with respect to insurance that
Article XIV of the Lease specifically confers upon the "Lessor", (C) to
provide such insurance as the Lessee shall have failed to maintain or as the
Borrower or the Holder may desire, and (D) to enforce compliance by the
Lessee with the provisions of Articles VIII, IX, X, XI, XIV and XVII of the
Lease.
(c) Release of the Facility, etc. If the Lessee shall at any time
purchase the Facility pursuant to the terms of the Lease, or the Construction
Agent shall purchase the Facility pursuant to the Agency Agreement, or if the
Facility shall be sold in accordance with Article XXII of the Lease, then,
upon satisfaction by the Borrower of its obligation to prepay the Loans, the
Holder Fundings and all other amounts owing to the Lenders and the Holder
under the Operative Agreements, the Administrative Agent is hereby authorized
and directed to release the Facility from the Liens created by the Security
Documents to the extent of its interest therein. In addition, upon the
termination of the Commitments and the payment in full of the Loans and all
other amounts owing by the Borrower hereunder or under any other Credit
Document, the Administrative Agent is hereby authorized and directed to
release the Facility from the Liens created by the Security Documents to the
extent of its interest therein. Upon request of the Borrower following any
such release, the Administrative Agent shall, at the sole cost and expense of
the Lessee, execute and deliver to the Borrower and the Lessee such documents
as the Borrower or the Lessee shall reasonably request to evidence such
release.
(d) Holder Excepted Payments. Notwithstanding any other provision of
this Agreement or the Security Documents, any Holder Excepted Payment received
at any time by the Administrative Agent shall be distributed promptly to the
Person entitled to receive such Holder Excepted Payment.
SECTION IX. MISCELLANEOUS
(a) Amendments and Waivers. Neither this Agreement, any other Credit
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 9.1 and
Section 14.5 of the Participation Agreement, and the provisions of this
Section 9.1 shall in all cases be subject to the provisions of Section 10.8
of the Participation Agreement. The Majority Lenders may, or, with the
written consent of the Majority Lenders, the Administrative Agent may, from
time to time, subject to the provisions of Section 10.8 of the Participation
Agreement, (a) enter into with the Borrower written amendments, supplements
or modifications to the Credit Documents for the purpose of adding any
provisions to the Credit Documents or changing in any manner the rights of
the Administrative Agent, the Lenders or the Borrower thereunder or (b)
waive, on such terms and conditions as the Majority Lenders or the
Administrative Agent, as the case may be, may specify in such instrument,
any of the requirements of the Credit Documents or any Default or Event of
Default and its consequences. In addition, but subject to the provisions of
Section 10.8 of the Participation Agreement, the Administrative Agent
may from time to time consent in writing to amendments, supplements,
modifications or waivers, and may grant consents, with respect to any
Operative Agreement (other than the Credit Documents), subject to receipt of
the prior written consent of the Majority Lenders. Notwithstanding the
foregoing, no such amendment, supplement, modification, waiver or consent
shall (i) reduce the amount or extend the scheduled date of maturity of any
Note, or reduce the stated rate of any interest payable hereunder (other than
as a result of waiving the applicability of any post-default increase in
interest rates) or any Lender Unused Fees payable under the Participation
Agreement or extend the scheduled date of any payment of such interest or
Lender Unused Fees or increase the amount or extend the expiration date of
any Lender's Commitment, in each case without the consent of each Lender
directly affected thereby, or (ii) amend, modify or waive any provision of
this Section 9.1 or reduce the percentage specified in the definition of
Majority Lenders, or consent to the assignment or transfer by the Borrower
of any of its rights and obligations under the Credit Documents or release a
material portion of the Collateral (except in accordance with Section 8.3) or
release the Lessee from its obligations under the Lease or otherwise alter
any payment obligations of the Lessee to the Lessor under the Operative
Agreements, in each case without the written consent of all the Lenders, or
(iii) amend, modify or waive any provision of Section 7 without the written
consent of the then Administrative Agent or (iv) permit Fundings for Work in
excess of the Construction Budget without the unanimous consent of the
Lenders and the Holder, or (v) eliminate the automatic option (in the
absence of the unanimous election of the Lenders and the Holder) under
Section 5.3(a) of the Agency Agreement requiring that the Construction Agent
pay certain liquidated damages in exchange for the conveyance of the Facility
to the Construction Agent, or (vi) permit the extension of the Construction
Period beyond the date that is two (2) years from the Initial Closing Date
without the unanimous consent of the Lenders and the Holder. Any such
waiver or consent and any such amendment, supplement or modification shall
apply equally to each of the Lenders and shall be binding upon the Borrower,
the Lessee, the Lenders and the Administrative Agent and all future holders
of the Notes. In the case of any waiver, the Borrower, the Lessee, the
Lenders and the Administrative Agent shall be restored to their former
position and rights under the Credit Documents, and any Default or Event
of Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extent to any subsequent or other Default or Event of Default,
or impair any right consequent thereon.
Anything in this Agreement to the contrary notwithstanding, if at a
time when the conditions precedent set forth in Section 4.2 hereof to any
Loan hereunder are, in the opinion of the Majority Lenders, satisfied, any
Lender shall fail to fulfill its obligations to make such Loan (any such
Lender, a "Defaulting Lender") then, for so long as such failure shall
continue, the Defaulting Lender shall (unless the Borrower and the Majority
Lenders, determined as if the Defaulting Lender were not a "Lender"
hereunder, shall otherwise consent in writing) be deemed for all purposes
relating to amendments, modifications, waivers or consents under this
Agreement (including, without limitation, under this Section 9.1) to have no
Loans, shall not be treated as a "Lender" hereunder when performing the
computation of Majority Lenders, and shall have no rights under the preceding
paragraph of this Section 9.1; provided that any action taken by the other
Lenders pursuant to this paragraph with respect to the matters referred to
in clause (i) through (vi) of the preceding paragraph shall not be effective
as against the Defaulting Lender.
(b) Notices. All notices required or permitted to be given under
this Agreement shall be in writing. Notices may be served by certified or
registered mail, postage paid with return receipt requested; by private
courier, prepaid; by telex, facsimile, or other telecommunication device
capable of transmitting or creating a written record; or personally. Mailed
notices shall be deemed delivered five days after mailing, properly
addressed. Couriered notices shall be deemed delivered when delivered as
addressed, or if the addressee refuses delivery, when presented for delivery
notwithstanding such refusal. Telex or telecommunicated notices shall be
deemed delivered when receipt is either confirmed by confirming transmission
equipment or acknowledged by the addressee or its office. Personal delivery
shall be effective when accomplished. Unless a party changes its address by
giving notice to the other parties hereto as provided herein, notices shall
be delivered to the Lenders as set forth in Schedule 1.1 hereto and to the
other parties hereto at the following addresses:
The Borrower:
First Security Bank of Utah, N.A.
79 South Main Street
Salt Lake City, Utah 84111
Attention: Mr. Val T. Orton
Corporate Trust Counsel
Telephone: (801) 246-5300
Telecopy: (801) 246-5053
NationsBank, as Administrative Agent:
NationsBank, N.A. (South)
600 Peachtree Street, N.E.
21st Floor
Atlanta, Georgia 30308
Attention: Catherine J. Rhodes
Vice President
Telephone No.: (404) 607-5531
Telecopy No.: (404) 607-6484
With a copy to:
NationsBank, N.A.
NC1-001-15-04
101 North Tryon Street
15th Floor
Charlotte, North Carolina 28255
Attention: Melissa P. Mullis
Corporate Credit Services
Representative
Telephone No.: (704) 386-2881
Telecopy No.: (704) 386-9923
or such additional parties, including future noteholders, and/or other address
as such party may hereafter designate, and shall be effective upon receipt or
refusal thereof, provided that any notice, request or demand to or upon the
Administrative Agent or the Lenders pursuant to Section 2.3, 2.5 2.6 or 2.7
shall not be effective until received.
(c) No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender,
any right, remedy, power or privilege hereunder or under the other Credit
Documents shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or future exercise thereof or the exercise of any other right, remedy, power
or privilege. The rights, remedies, powers and privileges herein provided
are cumulative and not exclusive of any rights, remedies, powers and
privileges provided by law.
(d) Survival of Representations and Warranties. All representations
and warranties made hereunder, in the other Credit Documents and in any
document, certificate or statement delivered pursuant hereto or in connection
herewith shall survive the execution and delivery of this Agreement and the
Notes and the making of the Loans hereunder.
(e) Payment of Expenses and Taxes. The Borrower agrees to: (a) pay
all reasonable out-of-pocket costs and expenses (to the extent incurred) of (i)
the Administrative Agent whether or not the transactions herein contemplated
are consummated, in connection with the negotiation, preparation, execution
and delivery of the Operative Agreements and the documents and instruments
referred to therein and any amendment, waiver or consent relating thereto
(including, without limitation, the reasonable fees and disbursements of
Moore & Van Allen, PLLC) and (ii) the Administrative Agent and each of the
Lenders in connection with the enforcement of the Operative Agreements and
the documents and instruments referred to therein (including, without
limitation, the reasonable fees and disbursements of counsel for the
Administrative Agent and for each of the Lenders) and (b) pay and hold each
of the Lenders harmless from and against any and all present and
future stamp and other similar taxes with respect to the foregoing matters
and save each of the Lenders harmless from and against any all liabilities
with respect to or resulting from any delay or omission (other than to the
extent attributable to such Lender) to pay such taxes.
(f) Successors and Assigns; Participations and Assignments. This
Agreement shall be binding upon and inure to the benefit of the Borrower, the
Lenders, the Administrative Agent, all future holders of the Notes and their
respective successors and assigns, except that the Borrower may not assign or
transfer any of its rights or obligations under this Agreement without the
prior written consent of each Lender.
(g) Participations. Any Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time sell to one or
more banks, financial institutions or other entities (each, a "Participant")
participating interests in any Loan owing to such Lender, any Note held
by such Lender, any Commitment of such Lender or any other interest of such
Lender hereunder and under the other Operative Agreements; provided that any
such sale of a participating interest shall be in a principal amount of at
least $5,000,000. In the event of any such sale by a Lender of a
participating interest to a Participant, such Lender's obligations under this
Agreement to the other parties to this Agreement shall remain unchanged,
such Lender shall remain solely responsible for the performance thereof, such
Lender shall remain the holder of any such Note for all purposes under this
Agreement and the Notes, and the Borrower and the Administrative Agent shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement and the Notes. In no
event shall any Participant have any right to approve any amendment or waiver
of any provision of this Agreement or any other Operative Agreement, or any
consent to any departure by the Borrower or any other Person therefrom,
except to the extent that such amendment, waiver or consent would (a) reduce
the principal of, or interest on, any Loan or Note, or postpone the date of
the final maturity of any Loan or Note, or reduce the amount of any Lender
Unused Fee, in each case to the extent subject to such participation or (b)
release all or substantially all of the Collateral. The Borrower agrees that,
while an Event of Default shall have occurred and be continuing, if amounts
outstanding under this Agreement and the Notes are due or unpaid, or shall
have become due and payable upon the occurrence of an Event of Default, each
Participant shall, to the maximum extent permitted by applicable law, be
deemed to have the right of setoff in respect of its participating interests
in amounts owing directly to it as a Lender under this Agreement or any
Note, provided that, in purchasing such participating interest, such
Participant shall be deemed to have agreed to share with the Lenders the
proceeds thereof as provided in Section 9.10(a) as fully as if it were a
Lender hereunder. The Borrower also agrees that each Participant shall be
entitled to the benefits of Sections 2.11, 2.12 and 2.13 with respect to its
participation in the Commitments and the Loans outstanding from time to time
as if it was a Lender; provided that, in the case of Section 2.13, such
Participant shall have complied with the requirements of said Section and
provided, further, that no Participant shall be entitled to receive any
greater amount pursuant to any such Section than the transferor Lender would
have been entitled to receive in respect of the amount of the participation
transferred by such transferor Lender to such Participant had no such
transfer occurred.
(h) Assignments. Any Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time and from time to
time assign to any Lender or any affiliate of any Lender or, with the consent,
subject to Section 11.1 of the Participation Agreement, of the Borrower and the
Administrative Agent (which in each case shall not be unreasonably withheld
or delayed and which consent of the Borrower shall not be required during the
continuation of any Event of Default), to an additional bank, financial
institution or other entity that is either organized under the laws of the
United States or any state thereof or is a foreign bank that operates a branch
office in the United States, (each, a "Purchasing Lender") all or any part of
its rights and obligations under this Agreement and the other Operative
Agreements pursuant to an Assignment and Acceptance, substantially in the
form of Exhibit B, executed by such Purchasing Lender, such assigning Lender
(and, in the case of a Purchasing Lender that is not a Lender or an affiliate
thereof, subject to Section 11.1 of the Participation Agreement, by the
Borrower and the Administrative Agent) and delivered to the Administrative
Agent for its acceptance and recording in the Register; provided that no such
assignment to a Purchasing Lender (other than any Lender or any affiliate
thereof) shall be in an aggregate principal amount less than $10,000,000
(other than in the case of an assignment of all of a Lender's interests under
this Agreement and the Notes). Upon such execution, delivery, acceptance
and recording, from and after the effective date determined pursuant to such
Assignment and Acceptance, (x) the Purchasing Lender thereunder shall be a
party hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder with a Commitment as
set forth therein, and (y) the assigning Lender thereunder shall, to the
extent provided in such Assignment and Acceptance, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the remaining portion of an assigning Lender's
rights and obligations under this Agreement, such assigning Lender shall
cease to be a party hereto). Notwithstanding anything to the contrary in
this Agreement, the consent of the Borrower shall not be required, and,
unless requested by the relevant Purchasing Lender and/or assigning Lender,
new Notes shall not be required to be executed and delivered by the Borrower,
for any assignment which occurs at any time when any of the events described
in Section 6(g) shall have occurred and be continuing.
Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and a Purchasing Lender (and, in the case of a Purchasing
Lender that is not a Lender or an affiliate thereof, by the Borrower and the
Administrative Agent) together with payment to the Administrative Agent of a
registration and processing fee of $2,500 (which shall not be payable by
the Borrower or the Lessee, except as otherwise provided in connection with
an assignment requested in accordance with Section 2.14(b)), the
Administrative Agent shall (i) promptly accept such Assignment and Acceptance
and (ii) promptly after the effective date determined pursuant thereto,
record the information contained therein in the Register and give notice of
such acceptance and recordation to the Lenders and the Borrower. On or prior
to such effective date, the Borrower, at its own expense, shall execute and
deliver to the Administrative Agent new Notes (in exchange for the Notes of
the assigning Lender), each in an amount equal to the Commitment assumed or
Loans purchased by the relevant Purchasing Lender pursuant to such Assignment
and Acceptance, and, if the assigning Lender has retained a Commitment or any
Loan hereunder, new Notes to the order of the assigning Lender, each in an
amount equal to the Commitment or Loans retained by it hereunder. Such new
Notes shall be dated the Effective Date and shall otherwise be in the form of
the Notes replaced thereby.
Each Purchasing Lender (other than any Lender organized and
existing under the laws of the U.S. or any political subdivision in or of
the U.S.), by executing and delivering an Assignment and Acceptance,
(A) agrees to execute and deliver to the Administrative Agent,
as promptly as practicable, four signed copies (two for the Administrative
Agent and two for delivery by the Administrative Agent to the Borrower) of
Form 1001 or Form 4224 (or any successor form or comparable form) (it being
nderstood that if the applicable form is not so delivered, payments under
or in respect of this Agreement may be subject to withholding and
deduction);
(B) represents and warrants to the Borrower and the
Administrative Agent that the form so delivered is true and accurate and
that, as of the effective date of the applicable Assignment and
Acceptance, each of such Purchasing Lender's Lending Offices is entitled
to receive payments of principal and interest under or in respect of this
Agreement without withholding or deduction for or on account of any taxes
imposed by the U.S. Federal government;
(C) agrees to annually hereafter deliver to each of the Borrower
and the Administrative Agent not later than December 31 of the year
preceding the year to which it will apply, two further properly completed
signed copies of Form 1001 or Form 4224 (or any successor form or
comparable form), as appropriate, unless an event has occurred which
renders the relevant form inapplicable (it being understood that if the
applicable form is not so delivered, payments under or in respect of this
Agreement may be subject to withholding and deduction);
(D) agrees to promptly notify the Borrower and the
Administrative Agent in writing if it ceases to be entitled to receive
payments of principal and interest under or in respect of this Agreement
without withholding or deduction for or on account of any taxes imposed
by the U.S. or any political subdivision in or of the U.S. (it being
understood that payments under or in respect of this Agreement may be
subject to withholding and deduction in such event);
(E) acknowledges that in the event it ceases to be exempt from
withholding and/or deduction of such taxes, the Administrative Agent may
withhold and/or deduct the applicable amount from any payments to which
such assignee Lender would otherwise be entitled, without any liability
to such assignee Lender therefor; and
(F) agrees to indemnify the Borrower and the Administrative
Agent from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs or expenses that
result from such assignee Lender's breach of any such representation,
warranty or agreement.
Any Lender party to this Agreement may, from time to time and
without the consent of the Borrower or any other Person, may pledge or
assign for security purposes any portion of its Loans or any other interests
in this Agreement and the other Credit Documents to any Federal Reserve Bank.
(i) The Register; Disclosure; Pledges to Federal Reserve Banks.
The Administrative Agent shall maintain at its address referred to in Section
9.2 a copy of each Assignment and Acceptance delivered to it and a register
(the "Register") for the recordation of the names and addresses of the
Lenders, the Commitments of the Lenders, and the principal amount of the
Loans owing to each Lender from time to time. The entries in the Register
shall be conclusive, in the absence of clearly demonstrable error, and the
Borrower, the Administrative Agent and the Lenders may treat each Person
whose name is recorded in the Register as the owner of the Loan recorded
therein for all purposes of this Agreement. The Register shall be available
for inspection by the Borrower or any Lender at any reasonable time and from
time to time upon reasonable notice.
Nothing herein shall prohibit any Lender from pledging or
assigning any Note to any Federal Reserve Bank in accordance with applicable
law.
(j) Adjustments; Set-off. Except as otherwise expressly provided in
Section 8.1 hereof and Section 10.7 of the Participation Agreement where, and
to the extent, one Lender is entitled to payments prior to other Lenders, if
any Lender (a "Benefitted Lender") shall at any time receive any payment of
all or part of its Loans, or interest thereon, or receive any collateral in
respect thereof (whether voluntarily or involuntarily, by set-off, pursuant
to events or proceedings of the nature referred to in Section 6(g), or
otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of such other Lender's Loans,
or interest thereon, such Benefitted Lender shall purchase for cash from the
other Lenders a participating interest in such portion of each such other
Lender's Loan, or shall provide such other Lenders with the benefits of any
such collateral, or the proceeds thereof, as shall be necessary to cause such
Benefitted Lender to share the excess payment or benefits of such collateral
or proceeds ratably with each of the Lenders; provided, however, that if all
or any portion of such excess payment or benefits is thereafter recovered
from such Benefitted Lender, such purchase shall be rescinded, and the
purchase price and benefits returned, to the event of such recovery, but
without interest.
In addition to any rights now or hereafter granted under
applicable law or otherwise, and not by way of limitation of any such rights,
upon the occurrence of an Event of Default, the Administrative Agent and
each Lender is hereby authorized at any time or from time to time, without
presentment, demand, protest or other notice of any kind to the Borrower or
to any other Person, any such notice being hereby expressly waived, to set
off and to appropriate and apply any and all deposits (general or special)
and any other Indebtedness at any time held or owing by the Administrative
Agent or such Lender (including, without limitation, by branches and agencies
of the Administrative Agent or such Lender wherever located) to or for the
credit or the account of the Borrower against and on account of the
obligations and liabilities of the Borrower to the Administrative Agent or
such Lender under this Agreement or under any of the other Operative
Agreements, including, without limitation, all interests in obligations of
the Borrower purchased by any such Lender pursuant to Section 9.10(a), and
all other claims of any nature or description arising out of or connected
with this Agreement or any other Operative Agreement, irrespective or whether
or not the Administrative Agent or such Lender shall have made any demand
and although said obligations, liabilities or claims, or any of them, shall
be contingent or unmatured.
(k) Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts
(including by telecopy), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of
this Agreement signed by all the parties shall be lodged with the Borrower
and the Administrative Agent.
(l) Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
(m) Integration. This Agreement and the other Credit Documents
represent the agreement of the Borrower, the Administrative Agent, and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or
any Lender relative to subject matter hereof not expressly set forth or
referred to herein or in the other Credit Documents.
(n) GOVERNING LAW. THIS AGREEMENT AND THE NOTES AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND THE NOTES SHALL BE
GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF GEORGIA.
(o) Submission To Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Credit Documents to which
it is a party, or for recognition and enforcement of any judgement in respect
thereof, to the non-exclusive general jurisdiction of the Courts of the State
of Georgia, the courts of the United States of America for the Northern
District of Georgia, and appellate courts from any thereof;
agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail) postage prepaid, to the Borrower at
its address set forth in Section 9.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction; and
waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this Section 9.15 any special, exemplary, punitive or consequential damages.
(p) Acknowledgements. Borrower hereby acknowledges that:
neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duly to the Borrower arising out of or in connection with
this Agreement or any of the other Credit Documents, and the relationship
between the Administrative Agent and the Lenders, on one hand, and the
Borrower, on the other hand, in connection herewith or therewith is solely that
of debtor and creditor; and
no joint venture is created hereby or by the other Credit
Documents or otherwise exists by virtue of the transactions contemplated
hereby among the Lenders or among the Borrower and the Lenders.
(q) WAIVERS OF JURY TRIAL. TO THE FULLEST EXTENT ALLOWED BY
APPLICABLE LAW, THE BORROWER, THE ADMINISTRATIVE AGENT AND THE LENDERS HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT AND FOR
ANY COUNTERCLAIM THEREIN.
(r) Nonrecourse. Anything to the contrary contained in this
Agreement or in any other Operative Agreement notwithstanding, neither the
Borrower nor any officer, director or shareholder thereof, nor any of the
Borrower's successors or assigns (all such Persons being hereinafter referred
to collectively as the "Exculpated Persons"), shall be personally liable in any
respect for any liability or obligation hereunder or under any other Operative
Agreement including the payment of the principal of, or interest on, the
Notes, or for monetary damages for the breach of performance of any of the
covenants contained in this Agreement, the Notes or any of the other
Operative Agreements. The Administrative Agent and the Lenders agree that,
in the event any of them pursues any remedies available to them under this
Agreement, the Notes or any other Operative Agreement, neither the
Administrative Agent nor the Lenders shall have any recourse against the
Borrower, nor any other Exculpated Person, for any deficiency, loss or claim
for monetary damages or otherwise resulting therefrom and recourse shall be
had solely and exclusively against the Trust Estate and the Lessee; but
nothing contained herein shall be taken to prevent recourse against or the
enforcement of remedies against the Trust Estate in respect of any and all
liabilities, obligations and undertakings contained in this Agreement, the
Notes or any other Operative Agreement. The Administrative Agent and the
Lenders further agree that the Borrower shall not be responsible for the
payment of any amounts owing hereunder (excluding principal and interest
(other than Overdue Interest) in respect of the Loans) (such non-excluded
amounts, "Supplemental Amounts") except to the extent that payments of
Supplemental Rent designated by the Lessee for application to such
Supplemental Amounts shall have been paid by the Lessee pursuant to the Lease
(it being understood that the failure by the Lessee for any reason to pay any
Supplemental Rent in respect of such Supplemental Amounts shall nevertheless
be deemed to constitute a default by the Borrower for the purposes of
Section 6(a)(ii)). Notwithstanding the foregoing provisions of this Section
9.18, nothing in this Agreement or any other Operative Agreement shall (a)
constitute a waiver, release or discharge of any obligation evidenced or
secured by this Agreement or any other Credit Document, (b) limit the right
of the Administrative Agent or any Lender to name the Borrower as a party
defendant in any action or suit for judicial foreclosure and sale under any
Security Document, or (c) affect in any way the validity or enforceability of
any guaranty (whether of payment and/or performance) given to the Lessor,
the Administrative Agent or the Lenders, or of any indemnity agreement given
by the Borrower, in connection with the Loans made hereunder.
(s) 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 PAYMENTS HEREUNDER
ARE HEREINAFTER CHARACTERIZED BY ANY COURT OF COMPETENT JURISDICTION
AS THE REPAYMENT OF PRINCIPAL AND INTEREST THEREON, THIS SECTION 9.19
SHALL APPLY. ANY SUCH 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, BUT NOT LIMITED TO, PREPAYMENT OR
ACCELERATION OF THE MATURITY OF ANY OBLIGATION), SHALL ANY INTEREST
TAKEN, RESERVED, CONTRACTED FOR, CHARGED, OR RECEIVED UNDER THIS
AGREEMENT 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 THE ADMINISTRATIVE AGENT OR ANY LENDER SHALL EVER
RECEIVE ANYTHING OF VALUE WHICH IS CHARACTERIZED AS INTEREST 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 BORROWER 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 NEITHER THE ADMINISTRATIVE AGENT NOR ANY LENDER INTENDS TO CHARGE
OR RECEIVE ANY UNEARNED INTEREST IN THE EVENT OF SUCH DEMAND. ALL
INTEREST PAID OR AGREED TO BE PAID TO THE ADMINISTRATIVE AGENT OR ANY
LENDER SHALL, TO THE EXTENT PERMITTED BY APPLICABLE LAW, BE AMORTIZED,
PRORATED, ALLOCATED, AND SPREAD THROUGHOUT THE FULL STATED TERM
(INCLUDING ANY RENEWAL OR EXTENSION) OF THIS AGREEMENT SO THAT THE
AMOUNT OF INTEREST ON ACCOUNT OF SUCH PAYMENTS DOES NOT EXCEED THE
MAXIMUM NONUSURIOUS AMOUNT PERMITTED BY APPLICABLE LAW.
(t) Replacement of Non-Extending Lenders. In the event the Lessee shall
request the Borrower under the Lease to extend the second Renewal Term beyond
February 6, 2003, so long as no Event of Default then exists, the Lessee shall
have the right to cause the Borrower to replace any Lender which does not
consent to such extension (a "Non-Extending Lender"), provided, that prior
to any such replacement, all outstanding Loans of such Non-Extending Lender,
accrued and unpaid interest thereon and all other amounts due and owing to
such Non-Extending Lender hereunder and under the other Operative Agreements
shall be paid in full to such Non-Extending Lender.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their proper and duly authorized officers
as of the day and year first above written.
FIRST SECURITY BANK OF UTAH, N.A., not
individually except as expressly stated herein,
but solely
as Owner Trustee for GGC Trust 1996-1
By:
Name:
Title:
Agreed to:
Val T. Orton, subject to Section 6.9 of the
Trust Agreement, as Owner Trustee
NATIONSBANK, N.A. (SOUTH), as Administrative
Agent
By:
Name:
Title:
ABN AMRO BANK N.V., as a Lender
By:
Name:
Title:
BANK OF MONTREAL, as a Lender
By:
Name:
Title:
THE BANK OF NEW YORK, as a Lender
By:
Name:
Title:
THE BANK OF NOVA SCOTIA, as a Lender
By:
Name:
Title:
THE BANK OF TOKYO TRUST COMPANY, as a
Lender
By:
Name:
Title:
THE CHASE MANHATTAN BANK, N.A., as a
Lender
By:
Name:
Title:
THE DAI-ICHI KANGYO BANK, LIMITED,
ATLANTA AGENCY, as a Lender
By:
Name:
Title:
THE FUJI BANK, LIMITED, as a Lender
By:
Name:
Title:
THE INDUSTRIAL BANK OF JAPAN, LIMITED, as
a Lender
By:
Name:
Title:
THE SAKURA BANK, LIMITED, ATLANTA
AGENCY, as a Lender
By:
Name:
Title:
RABOBANK NEDERLAND, NEW YORK BRANCH,
as a Lender
By:
Name:
Title:
By:
Name:
Title:
THE TOKAI BANK, LIMITED, ATLANTA
AGENCY, as a Lender
By:
Name:
Title:
WACHOVIA BANK OF GEORGIA, N.A., as a Lender
By:
Name:
Title:
Schedule 1.1
Commitment
Name and Address of Lender Amount Percentage
ABN AMRO Bank N.V. $7,000,000 6.862745098%
One Ravinia Drive, Suite 1200
Atlanta, GA 30346
Attn: Reenie Williamson
Phone: (770) 396-0066
Fax: (770) 399-7397
Bank of Montreal $7,000,000 6.862745098%
430 Park Avenue
New York, NY 10022
Attn: Bernard Silgardo
Phone: (212) 605-1647
Fax: (212) 605-1451
The Bank of New York $7,000,000 6.862745098%
One Wall Street, 22nd Floor
New York, NY 10286
Attn: Greg Batson
Phone: (212) 635-6898
Fax: (212) 635-6434
The Bank of Nova Scotia $7,000,000 6.862745098%
Atlanta Agency
600 Peachtree Street, N.E.
Atlanta, GA 30308
Attn: F.C.H. Ashby
Phone: (404) 877-1500
Fax: (404) 888-8998
The Bank of Tokyo Trust Company $8,800,000 8.627450981%
National Banking Department
1251 Avenue of the America
New York, NY 10116
Attn: Joseph P. Devoe
Phone: (212) 782-4318
Fax: (212) 782-6440
The Chase Manhattan Bank, N.A. $9,000,000 8.823529411%
1 Chase Manhattan Plaza, 4th Floor
New York, NY 10081
Attn: Michael McGovern
Phone: (212) 552-6332
Fax: (212) 552-7175
The Dai-Ichi Kangyo Bank, Ltd., $7,000,000 6.862745098%
Atlanta Agency
Marquis Two Tower, Suite 2400
285 Peachtree Center Avenue, NE
Atlanta, GA 30303
Attn: Patrick J. Tracy
Phone: (404) 581-0200
Fax: (404) 581-9657
The Fuji Bank, Limited $8,800,000 8.627450981%
245 Peachtree Center Avenue, NE
Suite 2100
Atlanta, GA 30303
Attn: Scott Keller
Phone: (404) 653-2100
Fax: (404) 653-2119
The Industrial Bank of Japan $8,800,000 8.627450981%
Limited
245 Park Avenue, 23rd Floor
New York, NY 10167-0037
Attn: Mikihide Katsumata
Phone: (212) 309-6452
Fax: (212) 682-2870
The Sakura Bank, Limited $8,800,000 8.627450981%
Atlanta Agency
245 Peachtree Center Avenue, NE
Suite 2703
Atlanta, GA 30303
Attn: Charles S. Zimmerman
Phone: (404) 521-3111
Fax: (404) 521-1133
Rabobank Nederland, New York Branch $7,000,000 6.862745098%
245 Park Avenue
New York, New York 10167
Attn: Corporate Services Department
Phone: (212) 916-7800
Fax: (212) 818-0233
The Tokai Bank, Limited, $7,000,000 6.862745098%
Atlanta Agency
Marquis Two Tower, Suite 2802
285 Peachtree Center Avenue, NE
Atlanta, GA 30303
Attn: Bruce Dearing
Phone: (404) 880-4601
Fax: (404) 653-0737
Wachovia Bank of Georgia, N.A. $8,800,000 8.627450981%
191 Peachtree Street, NE
Mail Code - 3940
Atlanta, GA 30303-1757
Attn: Michael Mountcastle
Phone: (404) 332-5317
Fax: (404) 332-5016
Exhibit A
NOTE
$______________ _______________
______, 1996
FOR VALUE RECEIVED, the undersigned, FIRST SECURITY BANK OF UTAH, N.A.,
not in its individual capacity, but solely as Owner Trustee for the GGC Trust
1996-1 (the "Borrower"), hereby unconditionally promises to pay to the order
of [Lender] (the "Lender") at the office of ________________________________
________________________ in lawful money of the United States of America and
in immediately available funds, on the Maturity Date, the principal amount of
(a) __________________________________________________________ NO/100 DOLLARS
($_____________), or, if less, (b) the aggregate unpaid principal amount of
all Loans made by the Lender to the Borrower pursuant to Section 2.1 of the
Credit Agreement (as defined below). The Borrower agrees to make partial
repayments of principal in the amounts and on the dates as provided in
Section 2.6(d) of the Credit Agreement and the Borrower further agrees to pay
interest in like money at such office on the unpaid principal amount hereof
from time to time outstanding at the rates and on the dates specified in
Section 2.8 of such Credit Agreement.
The holder of this Note is authorized to endorse on the schedules annexed
hereto and made a part hereof or on a continuation thereof which shall be
attached hereto and made a part hereof the date, Type and amount of each Loan
made pursuant to the Credit Agreement and the date and amount of each payment
or prepayment of principal thereof, each continuation thereof and each
conversion of all or a portion thereof to another Type. Each such
endorsement shall constitute prima facie evidence of the accuracy of the
information endorsed. The failure to make any such endorsement or any error
in such endorsement shall not affect the obligations of the Borrower in
respect of such Loan.
This Note (a) is one of the Notes referred to in the Credit Agreement
dated February 6, 1996 (as amended, supplemented or otherwise modified from
time to time, the "Credit Agreement"), among the Borrower, the Lender, the
other banks and financial institutions from time to time parties thereto and
NationsBank, N.A. (South), as Administrative Agent, (b) is subject to the
provisions of the Credit Agreement (including, without limitation, Section
9.18 thereof) and (c) is subject to optional and mandatory prepayment in
whole or in part as provided in the Credit Agreement. Reference is hereby
made to the Credit Documents for a description of the properties and assets
in which a security interest has been granted, the nature and extent of the
security and the guarantees, the terms and conditions upon which the security
interests and each guarantee were granted and the rights of the holder of
this Note in respect thereof.
Upon the occurrence of any one or more of the Events of Default, all
amounts then remaining unpaid on this Note shall become, or may be declared
to be, immediately due and payable, all as provided in the Credit Agreement.
All parties now and hereafter liable with respect to this Note, whether
maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.
Unless otherwise defined herein, terms defined in the Credit Agreement and
used herein shall have the meanings given to them in the Credit Agreement.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF GEORGIA.
FIRST SECURITY BANK OF UTAH, N.A., not
individually, but solely as Owner Trustee for GGC
Trust 1996-1
By:
Name:
Title:
Agreed to:
Val T. Orton, subject to Section 6.9 of the
Trust Agreement, as Owner Trustee
Exhibit B
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement, dated as of February 6, 1996
(as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among FIRST SECURITY BANK OF UTAH, N.A., not in its
individual capacity, but solely as Owner Trustee for the GGC Trust 1996-1
(the "Owner Trustee" or the "Borrower"), the Lenders named therein and
NationsBank, N.A. (South), as Administrative Agent. Unless otherwise defined
herein, terms defined in the Credit Agreement and used herein shall have the
meanings given to them in the Credit Agreement.
____________________ (the "Assignor") and _______________ (the "Assignee")
agree as follows:
(a) The Assignor hereby irrevocably sells and assigns to the Assignee
without recourse to the Assignor, and the Assignee hereby irrevocably
purchases and assumes from the Assignor without recourse to the Assignor, as
of the Effective Date (as defined below), a ___% interest (the "Assigned
Interest") in and to the Assignor's rights and obligations under the Credit
Agreement with respect to the credit facility contained in the Credit
Agreement as are set forth on Schedule 1 hereto (the "Assigned Facility"), in
a principal amount for the Assigned Facility as set forth on Schedule 1.
(b) The Assignor (a) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Operative
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement, any other Operative Agreement
or any other instrument or document furnished pursuant thereto, other than
that it has not created any adverse claim upon the interest being assigned
by it hereunder and that such interest is free and clear of any such adverse
claim; (b) makes no representation or warranty and assumes no responsibility
with respect to the financial condition of the Borrower, or any other obligor
or the performance or observance by the Borrower, or any other obligor of any
of their respective obligations under the Credit Agreement or any other
Operative Agreement or any other instrument or document furnished pursuant
hereto or thereto; and (c) attaches the Note held by it evidencing the
Assigned Facility and requests that the Administrative Agent exchange such
Note for a new Note payable to the Assignor and (if the Assignor has retained
any interest in the Assigned Facility) a new Note payable to the Assignee in
the respective amounts which reflect the assignment being made hereby (and
after giving effect to any other assignments which have become effective on
the Effective Date).
(c) The Assignee (a) represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance; (b) confirms that it
has received copies of the Operative Agreements, and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (c) agrees that it will,
independently and without reliance upon the Assignor, the Administrative Agent
or any other Lender and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Credit Agreement, the other Operative
Agreements or any other instrument or document furnished pursuant hereto or
thereto; (d) appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers and discretion
under the Credit Agreement, the other Operative Agreements or any other
instrument or document furnished pursuant hereto or thereto as are delegated
to the Administrative Agent by the terms thereof, together with such powers
as are incidental thereto; and (e) agrees that it will be bound by the
provisions of the Credit Agreement and the other Operative Agreements to
which Assignee is a party and will perform in accordance herewith all the
obligations which by the terms of the Credit Agreement and the other
Operative Agreements to which Assignee is a party are required to be
performed by it as a Lender including, if it is organized under the laws
of a jurisdiction outside the U.S., its obligation pursuant to Section
2.13(b) of the Credit Agreement.
(d) The effective date of this Assignment and Acceptance shall be
________, 19__ (the "Effective Date"). Following the execution of this
Assignment and Acceptance, it will be delivered to the Administrative Agent
for acceptance by it and recording by the Administrative Agent pursuant
to Section 9.9 of the Credit Agreement, effective as of the Effective Date
(which shall not, unless otherwise agreed to by the Administrative Agent, be
earlier than five Business Days after the date of such acceptance and
recording by the Administrative Agent).
(e) Upon such acceptance and recording, from and after the Effective
Date, the Administrative Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignee whether such amounts have accrued prior to the
Effective Date or accrue subsequent to the Effective Date. The Assignor and
the Assignee shall make all appropriate adjustments in payments by the
Administrative Agent for periods prior to the Effective Date or with respect
to the making of this assignment directly between themselves.
(f) From and after the Effective Date, (a) the Assignee shall be a party
to the Credit Agreement and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of a Lender thereunder and under
the other Operative Agreements and shall be bound by the provisions thereof
and (b) the Assignor shall, to the extent provided in this Assignment and
Acceptance, relinquish its rights and be released from its obligations under
the Credit Agreement and the other Operative Agreements.
(g) This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of Georgia.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their
respective duly authorized officers on Schedule 1 hereto.
SCHEDULE 1
TO ASSIGNMENT AND ACCEPTANCE
RELATING TO THE CREDIT AGREEMENT,
DATED AS OF FEBRUARY 6, 1996,
AMONG
FIRST SECURITY BANK OF UTAH, N.A.
NOT INDIVIDUALLY,
BUT SOLELY AS OWNER TRUSTEE,
THE LENDERS NAMED THEREIN
AND
NATIONSBANK, N.A. (SOUTH), AS ADMINISTRATIVE AGENT
FOR THE LENDERS (IN SUCH CAPACITY, THE "ADMINISTRATIVE AGENT")
Name of Assignor:
Name of Assignee:
Effective Date of Assignment:
Credit Principal Commitment
Facility Assigned Amount Assigned Percentage Assigned
$____________ ____________%
[Name of Assignee]
By: By:
Name: Name:
Title: Title:
Consented To:
FIRST SECURITY BANK OF UTAH, N.A., not
individually, but solely as Owner Trustee for
GGC Trust 1996-1
By:
Name:
Title:
NATIONSBANK, N.A. (SOUTH), as Administrative
Agent
By:
Name:
Title:
[consents required only to the extent expressly
provided in Section 9.8 of the Credit Agreement]
Exhibit 10(f)
SECURITY AGREEMENT
among
FIRST SECURITY BANK OF UTAH, N.A.,
not individually, but solely
as Owner Trustee under the
GGC Trust 1996-1,
(Val T. Orton, subject to Section 6.9
of the Trust Agreement, as Owner Trustee
under the GGC Trust 1996-1,)
NATIONSBANK, N.A. (SOUTH) ,
as Administrative Agent for the Lenders,
and
NATIONSBANC LEASING CORPORATION OF NORTH CAROLINA,
as the Holder
Dated as of February 6, 1996
TABLE OF CONTENTS
1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Grant of Security Interest. . . . . . . . . . . . . . . . . . . . . 3
3. Payment of Obligations. . . . . . . . . . . . . . . . . . . . . . . 5
4. Other Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5. Default; Remedies . . . . . . . . . . . . . . . . . . . . . . . . . 6
6. Remedies Not Exclusive. . . . . . . . . . . . . . . . . . . . . . . 6
7. Performance by the Relevant Collateral Agent of the Borrower's
Obligations 7
8. Duty of the Relevant Collateral Agent . . . . . . . . . . . . . . . 7
9. Powers Coupled with an Interest . . . . . . . . . . . . . . . . . . 7
10. Execution of Financing Statements . . . . . . . . . . . . . . . . . 7
11. Security Agreement Under Uniform Commercial Code. . . . . . . . . . 7
12. Authority of Relevant Collateral Agent. . . . . . . . . . . . . . . 8
13. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
14. Severability. . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
15. Amendment in Writing; No Waivers; Cumulative Remedies . . . . . . . 9
16. Section Headings. . . . . . . . . . . . . . . . . . . . . . . . . . 9
17. Successors and Assigns. . . . . . . . . . . . . . . . . . . . . . . 9
18. Borrower's Waiver of Rights . . . . . . . . . . . . . . . . . . . . 9
19. GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . 10
20. Obligations Are Without Recourse. . . . . . . . . . . . . . . . . 10
21. Partial Release; Full Release . . . . . . . . . . . . . . . . . . 11
22. Relative Rights . . . . . . . . . . . . . . . . . . . . . . . . . 11
23. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . 11
24. Conflicts with Participation Agreement. . . . . . . . . . . . . . 12
SECURITY AGREEMENT
This SECURITY AGREEMENT, dated as of February 6, 1996 (as amended,
supplemented or otherwise modified from time to time, this "Security
Agreement"), is made between FIRST SECURITY BANK OF UTAH, N.A., a national
banking association, not individually, but solely as Owner Trustee under the
GGC Trust 1996-1 (the "Borrower"), NATIONSBANK, N.A. (SOUTH), a national
banking association, as administrative agent (the "Administrative Agent") for
the lenders under the Credit Agreement dated as of February 6, 1996 (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), by and among the Borrower and NationsBank, N.A. (South), as
Administrative Agent and the financial institutions from time to time parties
thereto (the "Lenders") and NATIONSBANC LEASING CORPORATION OF NORTH CAROLINA,
as the holder (the "Holder") under that Trust Agreement dated as of February
6, 1996 between the Borrower and the Holder.
Preliminary Statement
Pursuant to the Credit Agreement, the Lenders have severally agreed to
make Loans to the Borrower in an aggregate amount not to exceed $102,000,000
upon the terms and subject to the conditions set forth therein, to be
evidenced by the Notes issued by the Borrower under the Credit Agreement and
the Holder has agreed to fund Holder Fundings to the Borrower, to be evidenced
by a Certificate issued by the Borrower pursuant to the Trust Agreement. The
Borrower is, or shall be upon the date of the initial Funding with respect
thereto, the legal and beneficial owner of the Facility (except the Borrower
shall have a leasehold interest in the Land pursuant to the Ground Lease).
It is a condition, among others, to the obligation of the Lenders to make
their respective Loans to the Borrower under the Credit Agreement and the
Holder to make Holder Fundings under the Trust Agreement that the Borrower
shall have executed and delivered this Security Agreement to the
Administrative Agent, for the benefit of the Lenders, and to the Holder.
NOW, THEREFORE, in consideration of the premises and to induce the Lenders
to make their respective Loans under the Credit Agreement and to induce the
Holder to fund Holder Fundings under the Trust Agreement, the Borrower hereby
agrees with the Administrative Agent, for the benefit of the Lenders, and
with the Holder, as follows:
1. Definitions. (a) As used herein, the following terms shall have the
following respective meanings:
"Accounts" shall mean all "accounts," as such term is defined in the
Uniform Commercial Code, now owned or hereafter acquired by the Borrower,
including without limitation (a) all accounts receivable, other
receivables, book debts and other forms of obligations now owned or
hereafter received or acquired by or belonging or owing to the Borrower,
whether arising out of goods sold or leased or services rendered by it
or from any other transaction (including without limitation any such
obligations which may be characterized as an account under the Uniform
Commercial Code), (b) all of the Borrower's rights in, to and under all
purchase orders or receipts now owned or hereafter acquired by it
for goods or services, (c) all of the Borrower's rights to any goods
represented by any of the foregoing (including without limitation unpaid
sellers' rights of rescission, replevin, reclamation and stoppage in
transit and rights to returned, reclaimed or repossessed goods),
(d) all monies due or to become due to the Borrower under all purchase
orders and contracts for the sale or lease of goods or the performance
of services or both by the Borrower (whether or not yet earned by
performance on the part of Borrower now) or hereafter in existence,
including without limitation the right to receive the proceeds of said
purchase orders and contracts, and (e) all collateral security and
guarantees of any kind, now or hereafter in existence, given by any
Person with respect to any of the foregoing.
"Chattel Paper" shall mean any and all "chattel paper," as such term
is defined in the Uniform Commercial Code, now owned or hereafter acquired
by the Borrower, wherever located.
"Contracts" shall mean any and all "contracts," as such term is
defined in the Uniform Commercial Code, now owned or hereafter acquired
by the Borrower, including without limitation all contracts,
undertakings, or agreements (other than rights evidenced by Chattel
Paper, Documents or Instruments) in or under which Borrower may now or
hereafter have any right, title or interest, including without
limitation any agreements relating to the terms of payment or the terms
of performance of any Account.
"Documents" shall mean any and all "documents", as such term is
defined in the Uniform Commercial Code, now owned or hereafter acquired
by the Borrower, wherever located.
"Holder Collateral" shall have the meaning given to such term in
Section 2 hereof.
"Instruments" shall mean any and all "instruments", as such term is
defined in the Uniform Commercial Code, now owned or hereafter acquired
by the Borrower, wherever located, including without limitation all
certificated securities, all certificates of deposit, and all notes and
other, without limitation, evidences of indebtedness, other than
instruments that constitute, or are a part of a group of writings that
constitute, Chattel Paper.
"Lender Collateral" shall have the meaning given to such term in
Section 2 hereof.
"Obligations" shall mean any and all obligations of the Borrower, now
existing or hereafter arising under the Credit Agreement, the Notes, the
Trust Agreement, the Certificate and/or any other Operative Agreement.
"Relevant Collateral" shall mean, as the context may require, (i) the
Holder Collateral or (ii) the Lender Collateral; provided, however, that
if only one Secured Party shall remain entitled to the benefits of this
Security Agreement, "Relevant Collateral" shall mean the Security
Agreement Collateral.
"Relevant Collateral Agent" shall mean, as the context may require,
(i) the Holder, with respect to the Holder Collateral and (ii) the
Administrative Agent, with respect to the Lender Collateral; provided,
however, that if only one Secured Party shall remain entitled to the
benefits of this Security Agreement, "Relevant Collateral Agent" shall
mean such remaining Secured Party.
"Secured Parties" shall mean the Administrative Agent, for the
benefit of the Lenders, and the Holder
"Security Agreement Collateral" shall have the meaning given to such
term in Section 2 hereof.
(b) Capitalized terms used but not otherwise defined in this
Security Agreement shall have the respective meanings specified in the
Credit Agreement or Appendix A to the Participation Agreement (as
defined in the Credit Agreement).
(c) The rules of usage set forth in Appendix A to the Participation
Agreement shall apply to this Agreement.
2. Grant of Security Interest. To secure payment of all the amounts
funded under the Credit Agreement and the Notes and pursuant to the Trust
Agreement and the Certificate, the proceeds of which are used to develop,
acquire, install, construct and test the Facility and its components, and
all other amounts now or hereafter owing to the Lenders, the Administrative
Agent or the Holder thereunder or under any Operative Agreement, THE BORROWER
HEREBY CONVEYS, GRANTS, ASSIGNS, TRANSFERS, HYPOTHECATES, MORTGAGES AND SETS
OVER (I) TO THE ADMINISTRATIVE AGENT, FOR THE BENEFIT OF THE LENDERS, A FIRST
PRIORITY SECURITY INTEREST IN AND LIEN ON THAT PORTION OF THE TRUST ESTATE
COMPRISED OF THE LENDER COLLATERAL AND A SECOND PRIORITY (SECOND ONLY
TO THE PRIOR INTEREST OF THE HOLDER IN THE HOLDER COLLATERAL) SECURITY
INTEREST IN AND LIEN ON THAT PORTION OF THE TRUST ESTATE COMPRISED OF
THE HOLDER COLLATERAL AND (II) TO THE HOLDER, A FIRST PRIORITY SECURITY
INTEREST IN AND LIEN ON THAT PORTION OF THE TRUST ESTATE COMPRISED OF
THE HOLDER COLLATERAL AND A SECOND PRIORITY (SECOND ONLY TO THE PRIOR
INTEREST OF THE ADMINISTRATIVE AGENT IN THE LENDER COLLATERAL) SECURITY
INTEREST IN AND LIEN ON THAT PORTION OF THE TRUST ESTATE COMPRISED OF
THE LENDER COLLATERAL, TO THE EXTENT OF THEIR RESPECTIVE INTERESTS
HEREIN AND THEREIN, AS MORE FULLY SET FORTH IMMEDIATELY BELOW:
(A) all right, title and interest of the Borrower in and to the
Operative Agreements (excluding the Lease) now existing or hereafter
acquired by the Borrower (including without limitation all rights to
payment and indemnity rights of the Borrower under the Participation
Agreement) (all of the foregoing in this paragraph (A) being referred
to as the "Rights in Operative Agreements");
(B) all right, title and interest of the Borrower in and to all
of the Equipment;
(C) all right, title and interest of the Borrower in and to all
of the Fixtures;
(D) all the estate, right, title, claim or demand whatsoever of
the Borrower, in possession or expectancy, in and to the Facility or
any part thereof;
(E) all right, title and interest of the Borrower in and to all
substitutes, modifications and replacements of, and all additions,
accessions and improvements to, the Fixtures and Equipment,
subsequently acquired by the Borrower or constructed, assembled or
placed by the Borrower on the Land, immediately upon such
acquisition, release, construction, assembling or placement, and in
each such case, without any further conveyance, assignment or other
act by the Borrower;
(F) all right, title and interest of the Borrower in, to and
under books and records relating to or used in connection with the
operation of the Facility or any part thereof; all rights of the
Borrower to the payment of money or property; and all rights
in and to any causes of action or choses in action now or hereafter
existing in favor of the Borrower and all rights to any recoveries
therefrom;
(G) all right, title and interest of the Borrower in and to all
unearned premiums under insurance policies now or subsequently
obtained by the Lessee relating to the Facility and the Borrower's
interest in and to all proceeds of any insurance policies
maintained by or for the benefit of Borrower, including without
limitation any right to collect and receive such proceeds; and all
awards and other compensation, including without limitation the
interest payable thereon and any right to collect and receive the
same, made to the present or any subsequent owner of the Facility for
the taking by eminent domain, condemnation or otherwise, of all or
any part of the Facility or any easement or other right therein;
(H) all right, title and interest of the Borrower in and to (i)
all consents, licenses, certificates and other governmental approvals
relating to construction, completion, use or operation of the
Facility or any part thereof and (ii) all Plans and Specifications
relating to the Facility;
(I) all Rent and all other rents, payments, purchase prices,
receipts, revenues, issues and profits payable under the Lease or
pursuant to any other lease with respect to the Facility;
(J) all Instruments and Documents;
(K) all Contracts;
(L) all Chattel Paper (including without limitation all rights
under the Lease);
(M) all money, cash or cash equivalent and bank accounts;
(N) all Accounts; and
(O) all proceeds, both cash and noncash, of any of the
foregoing.
(All of the foregoing property and rights and interests now owned or held
or subsequently acquired by the Borrower and described in the foregoing clauses
(A) through (O) are collectively referred to herein as the "Security Agreement
Collateral"; the portion of such Security Agreement Collateral described in
clauses (A) through (H), (J), (K), (M), and (N), to the extent of the
leasehold interest in the Land and the rights of control and possession of
the Facility only, clause (L) and, to the extent derived from such portion of
the Security Agreement Collateral described in such clauses, clause (O), is
collectively referred to herein as the "Holder Collateral"; and the portion
of such Security Agreement Collateral described in clause (I), exclusive only
of the leasehold interest in the Land and the rights of control and
possession of the Facility, clause (L) and, to the extent derived from such
portion of the Security Agreement Collateral described in such clauses,
clause (O), is collectively referred to herein as the "Lender Collateral.")
TO HAVE AND TO HOLD the Security Agreement Collateral and the rights and
privileges hereby granted unto the Administrative Agent and unto the Holder,
their respective successors and assigns for the uses and purposes set forth
herein, until all of the obligations of the Borrower under the Operative
Agreements are paid in full; provided, that EXCLUDED from the Security
Agreement Collateral at all times and in all respects shall be all Holder
Excepted Rights and Holder Excepted Payments and all Lender Excepted Rights
and Lender Excepted Payments and all Contingent Rent; and provided, further,
that the rights of the Administrative Agent in and to the Lender Collateral
shall be senior in all respects to the rights of the Holder therein and the
rights of the Holder in and to the Holder Collateral shall be senior in all
respects to the rights of the Administrative Agent therein.
3. Payment of Obligations. The Borrower shall pay all Obligations in
accordance with the terms of the Credit Agreement, the Notes and the other
Operative Agreements and perform each term to be performed by it under the
Credit Agreement, the Notes and the Operative Agreements.
4. Other Covenants. At any time and from time to time, upon the written
request of the Relevant Collateral Agent, and at the sole expense of the
Borrower, the Borrower will promptly and duly execute and deliver such
further instruments and documents and take such further actions as the
Relevant Collateral Agent reasonably may request for the purposes of
obtaining or preserving the full benefits of this Security Agreement and of
the rights and powers granted by this Security Agreement with respect to the
Relevant Collateral.
5. Default; Remedies. (a) If a Credit Agreement Event of Default has
occurred and is continuing:
(i) the Holder, in addition to all other remedies
available at law or in equity, shall have the right forthwith to
enter upon the Land (or any other place where any component of the
Facility is located at such time) without charge, and take
possession of all or any portion of the Facility, and to re-let the
Facility and receive the rents, issues and profits thereof, to make
repairs and to apply said rentals and profits, after payment of all
necessary or proper charges and expenses, on account of the amounts
hereby secured (subject to the Lender Excepted Payments and Lender
Excepted Rights and the rights of the Administrative Agent in the
Lender Collateral); and
(ii) the Holder, shall, as a matter of right, be entitled
to the appointment of a receiver for the Facility, and the Borrower
hereby consents to such appointment and waives notice of any
application therefor.
(b) If a Credit Agreement Event of Default has occurred and is
continuing, the Relevant Collateral Agent may proceed by an action at
law, suit in equity or other appropriate proceeding, to protect and
enforce its rights, whether for the foreclosure of the Lien of this
Security Agreement in the Relevant Collateral, or for the specific
performance of any agreement contained herein or for an injunction
against the violation of any of the terms hereof. The proceeds of any
sale of any of the Relevant Collateral shall be applied pursuant to
Section 10.7 of the Participation Agreement. In addition, the Relevant
Collateral Agent may proceed under Section 11 hereof.
(c) The Borrower hereby waives the benefit of all appraisement,
valuation, stay, extension and redemption laws now or hereafter in force
and all rights of marshalling in the event of any sale of the Security
Agreement Collateral or any portion thereof or interest therein.
6. Remedies Not Exclusive. Subject to Section 22 hereof, the Relevant
Collateral Agent shall be entitled to enforce payment of the indebtedness and
performance of the Obligations and to exercise all rights and powers under
this Security Agreement or under any of the other Operative Agreements or
other agreement or any laws now or hereafter in force, notwithstanding some
or all of the Obligations may now or hereafter be otherwise secured, whether
by deed of trust, mortgage, security agreement, pledge, Lien, assignment or
otherwise. Neither the acceptance of this Security Agreement nor its
enforcement, shall prejudice or in any manner affect the Relevant Collateral
Agent's right to realize upon or enforce any other security now or hereafter
held by it, it being agreed that, subject to Section 22 hereof, the Relevant
Collateral Agent shall be entitled to enforce this Security Agreement and any
other security now or hereafter held by it in such order and manner as
the Relevant Collateral Agent may determine in its absolute discretion.
No remedy herein conferred upon or reserved to any Relevant Collateral Agent
is intended to be exclusive of any other remedy herein or by law provided or
permitted, but each shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law or in equity
or by statute. Every power or remedy given by any of the Operative
Agreements to the Relevant Collateral Agent or to which it may otherwise be
entitled, may be exercised, concurrently or independently, from time to
time and as often as may be deemed expedient by the Relevant Collateral
Agent. In no event shall the Relevant Collateral Agent, in the exercise of
the remedies provided in this Security Agreement (including without
limitation in connection with the assignment of Rents to the Administrative
Agent, or the appointment of a receiver and the entry of such receiver onto
all or any part of the Land), be deemed a "mortgagee in possession" or a
"pledgee in possession", and the Relevant Collateral Agent shall not in any
way be made liable for any act, either of commission or omission, in
connection with the exercise of such remedies.
7. Performance by the Relevant Collateral Agent of the Borrower's
Obligations. If the Borrower fails to perform or comply with any of its
agreements contained herein the Relevant Collateral Agent, at its option, but
without any obligation so to do, may perform or comply, or otherwise cause
performance or compliance, with such agreement. The expenses of the Relevant
Collateral Agent incurred in connection with actions undertaken as provided
in this Section 7, together with interest thereon at a rate per annum equal
to the Overdue Rate, from the date of payment by the Relevant Collateral
Agent to the date reimbursed by the Borrower, shall be payable by the Borrower
to the Relevant Collateral Agent on demand and constitutes part of the
Obligations secured hereby.
8. Duty of the Relevant Collateral Agent. The Relevant Collateral
Agent's sole duty with respect to the custody, safekeeping and physical
preservation of any Security Agreement Collateral in its possession, under
Section 9-207 of the Uniform Commercial Code or otherwise, shall be to deal
with it in the same manner as the Relevant Collateral Agent deals with
similar property for its own account. Neither the Relevant Collateral Agent,
any Lender nor any of their respective directors, officers, employees,
shareholders, partners or agents shall be liable for failure to demand,
collect or realize upon any of the Security Agreement Collateral or for any
delay in doing so or shall be under any obligation to sell or otherwise
dispose of any Security Agreement Collateral upon the request of the Borrower
or any other Person or to take any other action whatsoever with regard to the
Security Agreement Collateral or any part thereof.
9. Powers Coupled with an Interest. All powers, authorizations and
agencies contained in this Security Agreement are coupled with an interest
and are irrevocable until this Security Agreement is terminated and the
Liens created hereby is released.
10. Execution of Financing Statements. Pursuant to Section 9-402 of the
Uniform Commercial Code, the Borrower authorizes the Relevant Collateral Agent
at the sole expense of the Borrower to file financing statements with respect
to the Relevant Collateral under the Security Agreement without the signature
of the Borrower in such form and in such filing offices as the Relevant
Collateral Agent reasonably determines appropriate to perfect the security
interests of the applicable Secured Party under this Security Agreement. A
carbon, photographic or other reproduction of this Security Agreement shall
be sufficient as a financing statement for filing in any jurisdiction.
11. Security Agreement Under Uniform Commercial Code. (a) It is the
intention of the parties hereto that this Security Agreement as it relates to
matters of the grant, perfection and priority of security interests the
subject hereof, shall constitute a security agreement within the meaning of
the Uniform Commercial Code of the States in which the Security Agreement
Collateral is located. If a Credit Agreement Event of Default shall occur,
then in addition to having any other right or remedy available at law or in
equity, the Relevant Collateral Agent may proceed under the applicable
Uniform Commercial Code and exercise such rights and remedies as may be
provided to a secured party by such Uniform Commercial Code with respect to
all or any portion of the Relevant Collateral which is personal property
(including without limitation taking possession of and selling such property).
If the Relevant Collateral Agent shall elect to proceed under the Uniform
Commercial Code, then fifteen days' notice of sale of the personal property
shall be deemed reasonable notice and the reasonable expenses of retaking,
holding, preparing for sale, selling and the like incurred by the Relevant
Collateral Agent shall include, but not be limited to, attorneys' fees and
legal expenses. At the Relevant Collateral Agent's request, the Borrower
shall assemble such personal property and make it available to the Relevant
Collateral Agent at a place designated by the Relevant Collateral Agent
which is reasonably convenient to both parties.
(b) The Borrower, upon request by the Relevant Collateral Agent from
time to time, shall execute, acknowledge and deliver to the Relevant Collateral
Agent one or more separate security agreements, in form satisfactory to the
Relevant Collateral Agent, covering all or any part of the Relevant
Collateral and will further execute, acknowledge and deliver, or cause to be
executed, acknowledged and delivered, any financing statement, affidavit,
continuation statement or certificate or other document as the Relevant
Collateral Agent may request in order to perfect, preserve, maintain,
continue or extend the security interest under, and the priority of the Liens
granted by, this Security Agreement and such security instrument. The
Borrower further agrees to pay to the Relevant Collateral Agent (with funds
provided by the Lessee for such purpose) on demand all costs and expenses
incurred by the Relevant Collateral Agent in connection with the preparation,
execution, recording, filing and re-filing of any such document and all
reasonable costs and expenses of any record searches for financing statements
the Relevant Collateral Agent shall reasonably require. The filing of any
financing or continuation statements in the records relating to personal
property or chattels shall not be construed as in any way impairing the right
of the Relevant Collateral Agent to proceed against any personal property
comprising the Relevant Collateral as real property, as set forth above.
12. Authority of Relevant Collateral Agent. The Borrower acknowledges
that the rights and responsibilities of the Relevant Collateral Agent under
this Security Agreement relating to the Relevant Collateral with respect to
any action taken by the Relevant Collateral Agent or the exercise or
non-exercise by the Relevant Collateral Agent of any option, voting right,
request, judgment or other right or remedy provided for herein or resulting
or arising out of this Security Agreement shall be governed by (a) in the
case of the Lender Collateral for so long as the Administrative Agent remains
a Secured Party hereunder, the Credit Agreement and by such other agreements
with respect thereto as may exist from time to time, but the Administrative
Agent shall be conclusively presumed to be acting as agent for the Lenders
with full and valid authority so to act or refrain from acting, and (b) in
the case of the Holder Collateral for so long as the Holder remains a Secured
Party hereunder, the Trust Agreement and by such other agreements with respect
thereto as may exist from time to time, and the Borrower in either case, shall
be under no obligation, or entitlement, to make any inquiry respecting such
authority.
13. Notices. All notices required or permitted to be given under this
Security Agreement shall be in writing and delivered as provided in the
Participation Agreement.
14. Severability. Any provision of this Security Agreement which is
prohibited or unenforceable shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining
provisions hereof.
15. Amendment in Writing; No Waivers; Cumulative Remedies. (a) None of
the terms or provisions of this Security Agreement may be waived, amended,
supplemented or otherwise modified except by a written instrument executed by
the Borrower and the Secured Parties in accordance with the terms of the
Operative Agreements.
(b) No failure to exercise, nor any delay in exercising, on the part
of the Relevant Collateral Agent, any right, power or privilege hereunder shall
operate as a waiver thereof. No single or partial exercise of any right, power
or privilege hereunder shall preclude any other or further exercise thereof or
the exercise of any other right, power or privilege. A waiver by the Relevant
Collateral Agent of any right or remedy hereunder on any one occasion shall
not be construed as a bar to any right or remedy which the Relevant
Collateral Agent would otherwise have on any future occasion.
(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
16. Section Headings. The section headings used in this Security
Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation
hereof.
17. Successors and Assigns. This Security Agreement shall be binding
upon the successors of the Borrower, and the Borrower shall not assign any of
its rights or obligations hereunder or with respect to any of the Security
Agreement Collateral without the prior written consent of the Secured
Parties. This Security Agreement shall inure to the benefit of the
Administrative Agent, the Lenders, the Holders and their respective
successors and assigns, in accordance with their respective interests herein.
18. Borrower's Waiver of Rights. Except as otherwise set forth herein,
to the fullest extent permitted by law, the Borrower waives the benefit of all
laws now existing or that may subsequently be enacted providing for (i) any
appraisement before sale of any portion of the Security Agreement Collateral,
(ii) any extension of the time for the enforcement of the collection of the
indebtedness or the creation or extension of a period of redemption from any
sale made in collecting such debt and (iii) exemption of any portion of the
Security Agreement Collateral from attachment, levy or sale under execution
or exemption from civil process. Except as otherwise set forth herein, to
the fullest extent the Borrower may do so, the Borrower agrees that the
Borrower will not at any time insist upon, plead, claim or take the benefit
or advantage of any law now or hereafter in force providing for any
appraisement, valuation, stay, exemption, extension or redemption, or requiring
foreclosure of this Security Agreement before exercising any other remedy
granted hereunder and the Borrower, for the Borrower and its successors and
assigns, and for any and all Persons ever claiming any interest in the
Security Agreement Collateral, to the extent permitted by law, hereby waives
and releases all rights of redemption, valuation, appraisement, stay of
execution, notice of election to mature or declare due the whole of the
Obligations and marshalling in the event of foreclosure of the Liens
hereby created.
19. GOVERNING LAW. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN
SECTION 11(a) HEREOF, THIS SECURITY AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS OF
THE STATE OF GEORGIA.
20. Obligations Are Without Recourse. (a) Except as otherwise expressly
provided in the Participation Agreement, anything to the contrary contained in
this Security Agreement, the Credit Agreement, the Notes, the Certificate or in
any other Operative Agreement notwithstanding, neither the Borrower nor the
Holder nor any officer, director, partner or shareholder of any thereof, nor
any of the Borrower's successors or assigns (all such Persons being
hereinafter referred to collectively as the "Exculpated Persons"), shall be
personally liable in any respect for any liability or obligation arising
hereunder or in any other Operative Agreement, including without limitation
the payment of the principal of, or interest on, the Notes, or for monetary
damages for the breach of performance of any of the covenants contained in
the Credit Agreement, the Notes, this Security Agreement or any of the other
Operative Agreements. Except as otherwise expressly provided in the
Participation Agreement, the Administrative Agent, on behalf of itself and
the Lenders, agrees that, in the event any of them pursues any remedies
available to them under the Credit Agreement, the Notes, this Security
Agreement, or under any other Operative Agreement, neither the Administrative
Agent nor the Lenders shall have any recourse against the Borrower, nor any
Exculpated Person, for any deficiency, loss or claim for monetary damages or
otherwise resulting therefrom, and recourse shall be had solely and
exclusively against the Trust Estate (excluding Holder Excepted Rights and
Holder Excepted Payments), but nothing contained herein shall be taken to
prevent recourse against or the enforcement of remedies against the Trust
Estate (excluding Holder Excepted Rights and Holder Excepted Payments) in
respect of any and all liabilities, obligations and undertakings contained in
this Security Agreement, the Credit Agreement, the Notes or in any other
Operative Agreement.
(b) Except as expressly provided in the Participation Agreement,
notwithstanding the provisions of paragraph (a) immediately above, nothing in
this Security Agreement, the Credit Agreement, the Notes or any other
Operative Agreement shall: (i) constitute a waiver, release or discharge of
any indebtedness or obligation evidenced by the Notes or the Certificate or
arising under this Security Agreement or the Credit Agreement or secured by
this Security Agreement, but the same shall continue until paid or discharged;
(ii) relieve the Borrower from liability and responsibility for (but only to
the extent of the damages arising by reason of): (a) active waste knowingly
committed by the Borrower with respect to the Facility or (b) any fraud on
the part of the Borrower or any such Exculpated Person); (iii) relieve the
Borrower from liability and responsibility for (but only to the extent of the
moneys misappropriated, misapplied or not turned over): (a) misappropriation or
misapplication by the Borrower (i.e., application in a manner contrary to any
of the Operative Agreements) of any insurance proceeds or condemnation awards
paid or delivered to the Borrower by any Person other than the Administrative
Agent; (b) except for Holder Excepted Payments, any deposits or any escrows or
amounts owed by the Construction Agent under the Agency Agreement held by the
Borrower; or (c) except for Holder Excepted Payments, any rents or other income
received by the Borrower from the Lessee that is not turned over to the
Administrative Agent in accordance with the Operative Agreements; or (iv)
affect or in any way limit the Administrative Agent's rights and remedies
hereunder with respect to the Rents and rights and powers of the
Administrative Agent assigned under the Operative Agreements or to obtain a
judgment against the Borrower (provided, that no deficiency judgment or other
money judgment shall be enforced against the Borrower or any Exculpated
Person except to the extent of the Borrower's interest in the Trust Estate
(excluding Holder Excepted Rights and Holder Excepted Payments) or to the
extent the Borrower may be liable as otherwise contemplated in clauses (ii)
and (iii) of this Section 20).
21. Partial Release; Full Release. The Secured Parties may release for
such consideration as they may require any portion of the Security Agreement
Collateral without (as to the remainder of the Security Agreement Collateral)
in any way impairing or affecting the Lien, security interest and priority
herein provided for the Secured Parties compared to any other Lien holder or
secured party. Further, upon receipt by the Borrower of the Termination
Value and payment to the Lenders of all principal and interest due on the
Loan and to the Holder of all funded amounts due on the Certificate and all
other Obligations with respect to the Facility encumbered by this Security
Agreement, the Secured Parties shall execute and deliver to the Borrower such
documents and instruments as may be required to release the Liens and
security interests created by this Security Agreement with respect to the
Security Agreement Collateral.
22. Relative Rights. The parties hereto expressly agree hereby that: (a)
the rights of the Administrative Agent in the Holder Collateral shall be
subordinate and junior to all rights of the Holder therein for so long as any
amounts owed to the Holder under the Operative Agreements (excluding Holder
Excepted Payments) remain unpaid and outstanding or the Holder shall be
obligated to fund Holder Fundings and (b) the rights of the Holder in the
Lender Collateral shall be subordinate and junior to all rights of the
Administrative Agent therein for so long as any amounts owed to the Lenders
or the Administrative Agent under the Operative Agreements remain unpaid and
outstanding or any Lender shall be obligated to make Loans under the Credit
Agreement.
23. Miscellaneous. (a) This Security Agreement is one of the documents
which create Liens and security interests that secure payment and performance
of the Obligations. The Relevant Collateral Agent, at its election, may
commence or consolidate in a single action all proceedings to realize upon
all such Liens and security interests relating to the Relevant Collateral.
The Borrower hereby waives (i) any objections to the commencement or
continuation of an action to foreclose the Lien of this Security Agreement or
exercise of any other remedies hereunder based on any action being prosecuted
or any judgment entered with respect to the Obligations or any Liens or
security interests that secure payment and performance of the Obligations and
(ii) any objections to the commencement of, continuation of, or entry of a
judgment in any such other action based on any action or judgment connected
to this Security Agreement. In case of a foreclosure sale, the Relevant
Collateral may be sold, at the Relevant Collateral Agent's election, in one
parcel or in more than one parcel and the Relevant Collateral Agent is
specifically empowered (without being required to do so, and in its sole and
absolute discretion) to cause successive sales of portions of the Relevant
Collateral to be held.
(b) Except as provided in the Operative Agreements, the Secured
Parties with the express written consent of the Borrower, may at any time or
from time to time renew or extend this Security Agreement, or alter or modify
the same in any way, or the Secured Parties may waive any of the terms,
covenants or conditions hereof in whole or in part and may release any
portion of the Security Agreement Collateral or any other security, and
grant such extensions and indulgences in relation to the Obligations secured
hereby as the Secured Parties may determine without the consent of any other
Person and without any obligation to give notice of any kind thereto and
without in any manner affecting the priority of the Lien hereof on any part
of the Security Agreement Collateral.
(c) Each of the parties hereto hereby irrevocably and
unconditionally:
(i) submits for itself and its property in any legal action or
proceeding relating to this Security Agreement and the other Operative
Agreements to which it is a party, or for recognition and enforcement of
any judgement in respect thereof, to the non-exclusive general
jurisdiction of the Courts of the State of Georgia, the courts of the
United States of America for the Northern District of Georgia, and
appellate courts from any thereof;
(ii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail, postage prepaid, to such party at its address set forth
in the Participation Agreement or at such other address of which such
parties shall have been notified pursuant thereto;
(iii) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction; and
(iv) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding
referred to in this Section 23(c) any special, exemplar or punitive
damages.
(d) TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE
PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY
JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS SECURITY
AGREEMENT OR ANY OTHER OPERATIVE AGREEMENT AND FOR ANY COUNTERCLAIM
THEREIN.
24. Conflicts with Participation Agreement. Notwithstanding any other
provision hereof, in the event of any conflict between the terms of this
Agreement and the Participation Agreement, the provisions of the
Participation Agreement will apply.
[The remainder of this page has been intentionally left blank.]
IN WITNESS WHEREOF, each of the undersigned parties has caused the
Security Agreement to be duly executed and delivered as of the date first
above written.
FIRST SECURITY BANK OF UTAH, N.A., not
individually, except as expressly set forth
herein, but solely as Owner Trustee under the
GGC Trust 1996-1
By:
Name:
Title:
Agreed to:
Val T. Orton, subject to Section 6.9 of the
Trust Agreement, as Owner Trustee
NATIONSBANK, N.A. (SOUTH), as
Administrative Agent for the Lenders
By:
Name:
Title:
NATIONSBANC LEASING CORPORATION
OF NORTH CAROLINA, as the Holder
By:
Name:
Title:
EXHIBIT 10(g)
__________________________
GROUND LEASE AGREEMENT
__________________________
LANDLORD: GEORGIA GULF CORPORATION
TENANT: FIRST SECURITY BANK OF UTAH, N.A.,
not individually, but solely as
Owner Trustee under the GGC Trust 1996-1
Covering land
in Iberville Parish, Louisiana
SUMMARY OF LEASE TERMS
1. Leased Property. The Property is the land described in
Exhibit A.
2. Lease Term. 40 years, commencing with the
"Commencement Date" referenced in the Lease.
3. Base Rent. The base rent is $1.00 per annum, with base
rent for the first fifteen (15) years of the Lease being due and
payable in full on ________, 1996.
4. Permitted Use. Any lawful use.
5. Taxes, Services, Utilities. Tenant will pay (or cause to
be paid) all property taxes, service charges and utility expenses
related to the Property.
6. Absolute Net Lease. Subject to the provisions of Section
7 of this Summary of Lease Terms, the Property is leased to Tenant on
an absolute net lease basis.
7. Overall Limitation. Notwithstanding anything contained
in this Lease to the contrary, until the TROL Lease has expired or is
terminated in accordance with its terms, Landlord agrees to perform on
behalf of Tenant all obligations of Tenant under this Ground
Lease and Tenant will have no liability of any kind to Landlord for the
performance or nonperformance of this Ground Lease.
INDEX
for
GROUND LEASE AGREEMENT
Page
1. Term; Possession. . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Term. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Acceptance of Property. . . . . . . . . . . . . . . . . . . . 1
1.3 Grant of Servitude of Access. . . . . . . . . . . . . . . . . 2
2. Rental. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.2 Time and Place of Base Rent Payments. . . . . . . . . . . . . 2
2.3 Additional Rent, No Offsets . . . . . . . . . . . . . . . . . 2
2.4 Absolute Net Lease. . . . . . . . . . . . . . . . . . . . . . 2
3. Use of Property . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3.1 Permitted Use . . . . . . . . . . . . . . . . . . . . . . . . 2
3.2 Compliance with Legal Requirements. . . . . . . . . . . . . . 3
3.3 Nondisturbance. . . . . . . . . . . . . . . . . . . . . . . . 3
4. Maintenance; Taxes; Utilities . . . . . . . . . . . . . . . . . . . 3
4.1 Maintenance . . . . . . . . . . . . . . . . . . . . . . . . . 3
4.2 Taxes and Assessments . . . . . . . . . . . . . . . . . . . . 3
4.3 Tenant's Election to Contest. . . . . . . . . . . . . . . . . 3
4.4 Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6. Disclaimer of Landlord's Responsibilities . . . . . . . . . . . . . 3
7. Condemnation. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
8. Transfers by Tenant . . . . . . . . . . . . . . . . . . . . . . . . 4
8.1 Transfer Permitted Without Consent. . . . . . . . . . . . . . 4
8.2 Notice of Certain Transfers . . . . . . . . . . . . . . . . . 4
9. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . 4
9.1 Payment Default . . . . . . . . . . . . . . . . . . . . . . . 5
9.2 Default in Other Covenants. . . . . . . . . . . . . . . . . . 5
10. Remedies on Default . . . . . . . . . . . . . . . . . . . . . . . . 5
10.1 Damages for Default . . . . . . . . . . . . . . . . . . . . . 5
10.2 Cure of Tenant's Default. . . . . . . . . . . . . . . . . . . 5
10.3 Other Remedies. . . . . . . . . . . . . . . . . . . . . . . . 5
11. Surrender at Expiration . . . . . . . . . . . . . . . . . . . . . . 5
12. General Provisions. . . . . . . . . . . . . . . . . . . . . . . . . 6
12.1 Modifications . . . . . . . . . . . . . . . . . . . . . . . . 6
12.2 No Implied Appurtenances. . . . . . . . . . . . . . . . . . . 6
12.3 Nonwaiver . . . . . . . . . . . . . . . . . . . . . . . . . . 6
12.4 Succession. . . . . . . . . . . . . . . . . . . . . . . . . . 6
12.5 Inspection. . . . . . . . . . . . . . . . . . . . . . . . . . 6
12.6 Estoppel Certificates . . . . . . . . . . . . . . . . . . . . 6
12.7 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
12.8 Attorneys' Fees . . . . . . . . . . . . . . . . . . . . . . . 7
12.9 Relationship of Parties . . . . . . . . . . . . . . . . . . . 8
12.10 Applicable Law. . . . . . . . . . . . . . . . . . . . . . . . 8
12.11 Prior Agreements. . . . . . . . . . . . . . . . . . . . . . . 8
12.12 Validity of Provisions. . . . . . . . . . . . . . . . . . . . 8
12.13 Ownership of Improvements . . . . . . . . . . . . . . . . . . 8
12.14 Recording; Quitclaim. . . . . . . . . . . . . . . . . . . . . 8
12.15 No Effect on TROL Lease . . . . . . . . . . . . . . . . . . . 8
12.16 Limitations on Recourse . . . . . . . . . . . . . . . . . . . 9
12.17 Merger of Estates . . . . . . . . . . . . . . . . . . . . . . 9
12.18 Limitation on Encumbrances. . . . . . . . . . . . . . . . . . 9
12.19 OVERALL LIMITATION. . . . . . . . . . . . . . . . . . . . . . 9
GROUND LEASE
(Iberville Parish, Louisiana)
DATED: February __, 1996
BETWEEN: GEORGIA GULF CORPORATION
400 Perimeter Center Terrace
Suite 595
Atlanta, Georgia 30346 LANDLORD
FIRST SECURITY BANK OF UTAH, N.A.
a national banking association
not individually, but solely
as Owner Trustee under the
GGC Trust 1996-1, whose address
is: 79 South Main Street
Salt Lake City, UT 84111 TENANT
Tenant wishes to lease from Landlord the following property (the "Property")
located in the State of Louisiana described as follows:
Certain land in Iberville Parish, Louisiana, as described on the attached
Exhibit A.
WHEREAS, in addition to paying the base rent as set forth in this Lease,
the Tenant has agreed to facilitate the financing of a cogeneration facility
located on the Property to be operated by the Landlord.
NOW, THEREFORE, Landlord hereby leases the Property to Tenant on the
following terms of this Ground Lease (the "Lease"):
I Term; Possession.
1.1 Term. The term of this Lease shall be for a period of 40 years,
beginning on the "Commencement Date" referenced below. The "Commencement
Date" will be the "Facility Closing Date" as defined in and established under
a Participation Agreement dated as of February __, 1996 (as amended,
modified, extended, supplemented, restated and/or replaced from time to time in
accordance with the terms thereof, the "Participation Agreement") and between
Georgia Gulf Corporation, as Construction Agent and Lessee, NationsBanc
Leasing Corporation of North Carolina, as Holder, certain Lenders named
therein, and NationsBank, N.A. (South), as Administrative Agent
for the Lenders (in such capacity, the "Administrative Agent"). Upon
Landlord's request, Tenant will execute a supplemental memorandum at the
start of the lease term stating the Commencement Date.
1.2 Acceptance of Property. Tenant accepts the Property in its present
condition, AS IS. Landlord shall not be required to perform any work to ready
the Property for Tenant's use.
1.3 Grant of Servitude of Access. (a) Landlord hereby grants to Tenant
a non-exclusive servitude and right to use for pedestrian and vehicular ingress
and egress during the term of this Lease the roadway described on Exhibit B
attached hereto. Landlord shall have the right at Landlord's expense to
relocate the roadway described on Exhibit B to other land owned by Landlord
from time to time, in which event Landlord and Tenant agree to execute an
amendment to this Lease and an amendment to the memorandum of ground lease
agreement for purposes of recording and setting forth where such relocated
servitude is.
(b) Landlord further grants to Tenant a non-exclusive servitude and right
to use during the term of this Lease the equipment describe on Exhibit C
attached hereto and located on the Landlord's Chemical Complex adjacent to
the Property.
II Rental.
2.1 Base Rental. During the lease term, Tenant will pay to Landlord a
base rent of $1.00 per annum, with base rent for the first fifteen (15) years
of the Lease being due and payable in full on _________, 1996.
2.2 Time and Place of Base Rent Payments. The base rent will be paid in
arrears on December 31st of each year for the prior calendar year (or partial
calendar year) during the lease term, and on the last day of the lease term,
at the address for Landlord set forth in this Lease. Base rent is uniformly
apportionable day to day.
2.3 Additional Rent, No Offsets. All payments required to be paid by
Tenant under this Lease, other than base rent, will constitute additional
rent. All rent (including base and additional rent) shall be received by
Landlord without set-off, offset, abatement, or deduction of any kind.
2.4 Absolute Net Lease. It is the intent and effect of this Lease that
rental paid by Tenant shall be an absolute net return to Landlord. Landlord
shall not be responsible for payment of any taxes and assessments, operating
expenses, or any other costs, expense, charge or premium under this Lease
relative to the leased Property. Such rental shall be paid to Landlord
throughout the lease term, free of any charges, assessments, impositions,
offsets or deductions of any kind. Tenant shall pay (or cause to be paid)
all costs, expenses and charges of every kind and nature relating to the
Property which may arise or become due or payable during or after (but
attributable to a period falling within) the lease term.
The provisions of this Section 2.4 are subject in all respects to the
terms and provisions of Section 12.19 hereof and will not, however, be
construed to modify the express agreement between the parties with respect
to the matters stated in Section 7 below (concerning certain circumstances in
which this Lease may be terminated, in which event Tenant's obligations
hereunder will terminate as of the effective date of such termination).
III Use of Property.
3.1 Permitted Use. Tenant shall use the Property for any lawful purpose.
3.2 Compliance with Legal Requirements. In connection with its use,
Tenant shall put, keep and maintain the Property in compliance with all
applicable laws, rules, regulations and ordinances of all federal, state,
county, municipal and other public authorities having or claiming
jurisdiction, and other recorded covenants, conditions and restrictions
affecting the Property (collectively, the "Legal Requirements").
3.3 Nondisturbance. The rights of Tenant to the Property shall not be
disturbed, canceled, terminated or otherwise affected: (i) during the term
of the TROL Lease (as hereinafter defined), and (ii) after the expiration of
the TROL Lease provided no Event of Default exists.
IV Maintenance; Taxes; Utilities.
4.1 Maintenance. Tenant shall keep the Property in good repair,
operating condition, and appearance. After commencement of the lease term,
Landlord shall have no obligation to make any repairs or perform any
maintenance on the Property.
4.2 Taxes and Assessments. Tenant shall pay (or cause to be paid) all
taxes, assessments and public charges ("taxes") on the land, and on the
improvements thereon, subject to such tax indemnifications as Tenant may be
entitled to receive under the TROL Lease or other agreements.
4.3 Tenant's Election to Contest. Tenant may withhold payment of any
tax or assessment on the Property if a good faith dispute exists as to the
obligation to pay, so long as Landlord's property interest is not jeopardized.
If the Property is subjected to a lien as a result of nonpayment, Tenant
shall provide Landlord with assurances reasonably acceptable to Landlord that
Tenant can and will satisfy the lien before enforcement against the Property.
4.4 Utilities. Tenant will be responsible for causing to be paid all
charges for services and utilities incurred in connection with the use,
occupancy and operation of the Property, including (without limitation)
charges for electricity, gas, telephone service, water and sewer.
V Liens. Tenant shall pay (or caused to be paid) as due all claims for work
done on or for services rendered or material furnished to the Property, and
shall keep the Property free from any liens which could result in foreclosure
of Landlord's or Tenant's interest in the Property, except for financing by
Tenant on its leasehold estate (which will bind Tenant's interest but not
constitute a lien against Landlord's interest in the Property). If Tenant
fails to pay such claim or to discharge any lien, Landlord may do so and
collect such amount as additional rent. Amounts paid by Landlord shall bear
interest and be repaid by Tenant as provided in paragraph 10.2 below. Such
payment by Landlord shall not constitute a waiver of any right or remedy
Landlord may have because of Tenant's default.
VI Disclaimer of Landlord's Responsibilities.
Landlord shall not be liable to pay for any work, labor or services
rendered or materials furnished to or for the account of Tenant, and no
mechanic's or other lien for such work, labor or services or material
furnished shall, under any circumstances, attach to or affect the
reversionary interest of Landlord in any building(s) or any alterations,
repairs, or improvements to be erected or made on the Property. Nothing
contained in this Lease shall be deemed or construed in any way as
constituting the request of consent of Landlord, either express or implied,
to any contractor, subcontractor, laborer or materialman for the performance
of any labor or the furnishing of any materials for any specific improvement,
alteration to or repair of the Property or any part thereof, nor as giving
Tenant any right, power or authority to contract for or permit the rendering
of any services or the furnishing of any materials on behalf of Landlord that
would give rise to the filing of any lien against Landlord's interest in the
Property.
VII Condemnation.
If the entire Property is condemned, or if a portion is taken which causes
the remainder to be unsuited to the use permitted hereunder, then this Lease
shall terminate as of the date upon which possession of the Property is taken
by the condemning authority. The net condemnation proceeds shall be divided
between Landlord and Tenant in proportion to the value of their respective
interests in the Property immediately prior to the taking. If only a portion
of the Property is taken and this Lease is not terminated, Tenant shall use
the condemnation proceeds to make necessary repairs and alterations to the
Property to permit Tenant to continue its operations thereon, and the balance
shall be paid to Landlord, except for any award specifically made to Tenant
for interruption of business, moving expenses, or the taking of Tenant's
improvements, equipment or fixtures. Rent shall not be abated during the
period of restoration. Rent shall be reduced for the remainder of the lease
term to the extent and in the same proportion as the reduction in area of the
Property. Sale of all or a part of the Property to a purchaser with the
power of eminent domain in the face of a threat or the probability of the
exercise of the power shall be treated as a taking by condemnation.
VIII Transfers by Tenant.
8.1 Transfer Permitted Without Consent. Tenant may assign, pledge,
hypothecate, encumber, sublease and otherwise transfer its leasehold estate
and interest in the Property without the need for consent from Landlord.
8.2 Notice of Certain Transfers. Tenant shall notify Landlord of any
assignment or transfer of its Lease interest, and may (but will not be
required to) notify Landlord as to any pledge, hypothecation, encumbrance or
sublease of its Lease interest. Tenant has notified Landlord that it will
be encumbering and assigning its Lease interest for security purposes to
NationsBanc Leasing Corporation of North Carolina, for the benefit of itself
and the Administrative Agent.
IX Events of Default.
After, but only after, the termination or expiration of the TROL Lease,
the following shall be "Events of Default":
9.1 Payment Default. Failure of Tenant to make any rent or other payment
under this Lease within 20 days after receipt of written notice of nonpayment.
9.2 Default in Other Covenants. Failure of Tenant to comply with any
other term or condition or fulfill any other obligation of this Lease within
30 days after written notice by Landlord specifying the nature of the default
with reasonable particularity. If the default is of such a nature that
it cannot be remedied fully within the 30-day period, this requirement shall
be satisfied if Tenant begins correction of the default within the 30-day
period and thereafter proceeds with reasonable diligence and in good faith to
effect the remedy as soon as practicable.
X Remedies on Default.
Subject to the provisions of Section 12.16 hereof, upon default (after
expiration of notice and cure periods provided in paragraph 9), Landlord may
exercise any one or more of the following remedies:
10.1 Damages for Default. Landlord may recover all damages caused by the
default. Landlord may sue periodically to recover damages as they accrue
during the remainder of the lease term without barring a later action for
further damages. Landlord may at any time bring an action for accrued
damages plus damages for the remaining lease term equal to the difference
between the rent specified in this Lease and the reasonable rental value of
the Property for the remainder of the term, discounted to the time of
judgment at the rate of 9 percent per annum.
10.2 Cure of Tenant's Default. Without prejudice to any other remedy for
default, Landlord may perform any obligation or make any payment required to
cure a default by Tenant. The reasonable cost of performance, including
reasonable attorneys' fees and all disbursements, shall immediately be
repaid by Tenant upon demand, together with interest from the date of
expenditure until fully paid at the rate of 12 percent per annum, but not in
any event at a rate greater than the maximum rate of interest permitted by
law.
10.3 Other Remedies. Landlord may exercise any other remedy available
under applicable law except that Landlord will have no right to terminate
this Lease for any default by Tenant, but Landlord may pursue any other
legal remedy for breach of contract, including (without limitation) specific
performance collection of damages, and enforcement of judgment(s) against the
Property (subject to the limitations in paragraph 12.16 below).
XI Surrender at Expiration.
Upon expiration of the lease term or earlier termination on account of
default by Landlord, Tenant shall surrender the Property in good condition.
All repair for which Tenant is responsible shall be completed to the latest
practical date prior to such surrender.
XII General Provisions.
12.1 Modifications. This Lease may not be modified except by endorsement
in writing attached to this Lease, dated and signed by the parties. Neither
party shall not be bound by any statement of any agent or employee modifying
this Lease, except for any person which the party has specifically designated
in writing as its representative.
12.2 No Implied Appurtenances. This Lease does not create any rights,
easements or licenses, by implication or otherwise, except as expressly set
forth in this Lease or its exhibits. This Lease is subordinated to all
mortgage instruments respecting the Property in favor of NationsBanc Leasing
Corporation of North Carolina, in any capacity. The Landlord hereby waives
any rights it has under La. Civil Code art. 2705.
12.3 Nonwaiver. Waiver of performance of any provision shall not be a
waiver of nor prejudice the party's right otherwise to require performance
of the same provision or any other provision.
12.4 Succession. Subject to the limitations on transfer of Tenant's
interest, this Lease shall bind and inure to the benefit of the parties,
their respective heirs, successors, and assigns.
12.5 Inspection. Landlord or its authorized representatives may enter at
any reasonable time after such advance notice as is reasonable under the
circumstances (except in cases of emergency, for which no advance notice is
required) to determine Tenant's compliance with this Lease, to attend to
Landlord's interest, to show the Property to a prospective party desiring to
acquire Landlord's interest, or (during the last 18 months of the Lease term)
to show the Property to any prospective tenants.
12.6 Estoppel Certificates. Within 10 days after receipt of written
request, each party shall deliver a written statement to the requesting party
stating the date to which the rent and other charges have been paid, whether
the Lease is unmodified and in full force and effect, and any other matters
that may reasonably be requested.
12.7 Notices. All notices required or permitted to be given under this
Agreement shall be in writing. Notices may be served by certified or
registered mail, postage paid with return receipt requested; by private
courier, prepaid; by telex, facsimile, or other telecommunication device
capable of transmitting or creating a written record; or personally. Mailed
notices shall be deemed delivered five days after mailing, properly
addressed. Couriered notices shall be deemed delivered when delivered as
addressed, or if the addressee refuses delivery, when presented for delivery
notwithstanding such refusal. Telex or telecommunicated notices shall be
deemed delivered when receipt is either confirmed by confirming transmission
equipment or acknowledged by the addressee or its office. Personal delivery
shall be effective when accomplished. Unless a party changes its address by
giving notice to the other party as provided herein, notices shall be
delivered to the parties at the following addresses:
If to Landlord, to it at:
Georgia Gulf Corporation
400 Perimeter Center Terrace
Suite 595
Atlanta, Georgia 30346
Attention: Samuel M. Hensley,
Corporate Controller
Telephone: (770) 395-4577
Telecopy: (770) 395-4529
If to the Tenant, to it at:
First Security Bank of Utah,
N.A.
79 South Main Street
Salt Lake City, UT 84111
Attn: Mr. Val T. Orton,
Corporate Trust Counsel
Tel: (801) 246-5300
Fax: (801) 246-5053
With a copy to:
NationsBank, N.A. (South)
600 Peachtree Street, NE
21st Floor
Atlanta, Georgia 30308
Attn: Catherine S. Rhodes,
Vice President
Tel: (404) 607-5531
Fax: (404) 607-6484
From time to time any party may designate additional parties and/or another
address for notice purposes by notice to each of the other parties hereto.
Notice shall be effective upon receipt or refusal thereof.
12.8 Attorneys' Fees. In the event suit or action is instituted to
interpret or enforce the terms of this Lease, the prevailing party shall be
entitled to recover from the other party such sum as the court may adjudge
reasonable as attorneys' fees at trial, upon appeal and on any petition for
review, in addition to all other sums provided by law.
12.9 Relationship of Parties. The relationship of the parties to this
Lease is that of landlord and tenant. Landlord is not a partner or joint
venturer with Tenant in any respect or for any purpose in the conduct of
Tenant's business or otherwise.
12.10 Applicable Law. The Property is located in the State of Louisiana.
The parties agree that the law of the State of Louisiana shall be applicable
for purposes of construing and determining the validity of this Lease.
12.11 Prior Agreements. This Lease (including all exhibits, incorporated
herein) is the entire, final, and complete agreement of the parties with
respect to the matters set forth in this Lease, and supersedes and replaces
all written and oral agreements previously made or existing by and between
the parties or their representatives with respect to such matters.
12.12 Validity of Provisions. If any of the provisions contained in this
Lease shall be invalid, illegal, or unenforceable in any respect, the validity
of the remaining provisions contained in this Lease shall not be affected.
12.13 Ownership of Improvements. For purposes of this Lease,
"improvements" shall include the buildings, structures, parking facilities
and other improvements and any landscaping subsequently placed on the
Property. All improvements constructed on the Property shall be the property
of Tenant.
Landlord acknowledges that it will be and is bound by the following
provisions in the TROL Lease (described in paragraph 12.15 below): All
Modifications (as defined in the TROL Lease) financed by Tenant (as lessor
under the TROL Lease) shall become the property of, and title thereto shall
immediately and without further action vest in, Tenant, when installed, and
may be made by Tenant without the consent of Landlord. All other
Modifications shall become the property of, and title thereto shall
immediately and without further action vest in, Tenant on surrender of the
Property by the lessee under the TROL Lease to Tenant (as lessor under the
TROL Lease) or the earlier termination of the TROL Lease or the occurrence of
a Lease Default under Sections 17.1(i), (j) or (k) of the TROL Lease.
Thereafter, such Modifications will remain the property of, and title thereto
vest in, Tenant until the expiration or earlier termination of this Lease, at
which time they shall automatically and without further action become the
property of Landlord.
12.14 Recording; Quitclaim. Tenant shall not file or record this Lease
without the specific prior written consent of Landlord, but the parties will
execute a good and sufficient memorandum of lease for purposes of recording.
Upon expiration or earlier termination of this Lease, Tenant shall promptly
execute, acknowledge and deliver to Landlord any quitclaim deed or other
document required by Landlord or a title company to remove the cloud of this
Lease from the Property and to evidence the termination of Tenant's interests
in the Property and improvements that will remain on the Property.
12.15 No Effect on TROL Lease. No provision of this Lease will affect in
any manner the duties and obligations of Landlord under the Lease Agreement
(Tax Retention Operating Lease Agreement) dated as of February 6, 1996 (as
amended, modified, extended, supplemented, restated and/or replaced from
time to time in accordance with the terms thereof, the "TROL Lease") between
Tenant (in its capacity as lessor thereunder) and Landlord (in its capacity
as lessee thereunder).
12.16 Limitations on Recourse. Notwithstanding anything contained in this
Lease to the contrary, Landlord agrees to look solely to Tenant's estate and
interest in the Property for the collection of any judgment requiring the
payment of money by Tenant in the event of liability by Tenant, and no other
property or assets of Tenant or any shareholder, owner or partner (direct or
indirect) in or of Tenant, 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 Landlord
under or with respect to this Lease, the relationship of the parties hereunder
or Tenant's use of the Property or any other liability of Tenant to Landlord.
12.17 Merger of Estates. In the event and at such time as Landlord may own
and hold both the landlord's and tenant's interest under this Lease, this Lease
will terminate automatically by merger of estates.
12.18 Limitation on Encumbrances. Landlord agrees that, subject to the
terms of Article XIII of the TROL Lease relating to permitted contests,
Landlord shall not directly or indirectly create or allow to remain, and
shall promptly discharge at its sole cost and expense, any Lien (as defined
in the TROL Lease or Participation Agreement), defect, attachment, levy,
title retention agreement or claim upon the Property or any Modifications
(as defined in the TROL Lease or Participation Agreement) other than
Permitted Liens (as defined in the TROL Lease or Participation Agreement) and
Lessor Liens (as defined in the TROL Lease or Participation Agreement).
Landlord shall promptly notify Tenant in the event it receives actual
knowledge that a Lien other than a Permitted Lien or Lessor Lien has
occurred with respect to the Property.
12.19 OVERALL LIMITATION. NOTWITHSTANDING ANYTHING CONTAINED IN
THIS LEASE TO THE CONTRARY, UNTIL THE TROL LEASE HAS EXPIRED OR IS
TERMINATED IN ACCORDANCE WITH ITS TERMS, LANDLORD AGREES TO PERFORM
ON BEHALF OF TENANT ALL OBLIGATIONS OF TENANT UNDER THIS GROUND LEASE
OTHER THAN THE TENANT'S OBLIGATION TO PAY BASIC RENT AND TENANT WILL
HAVE NO LIABILITY OF ANY KIND TO LANDLORD FOR THE PERFORMANCE OR
NONPERFORMANCE OF THIS GROUND LEASE OTHER THAN THE TENANT'S
OBLIGATION TO PAY BASIC RENT.
12.20 Assignment. The terms of this Lease shall be binding and inure to
the benefit of the successors and assigns of the parties hereto. To the
extent permitted by the Operative Agreements, the Tenant may assign this
Lease to any other person or entity without the prior consent of the
Landlord; provided, however, at the request of the Tenant the Landlord will
provide written consent to any assignment. All the provisions of this Lease
shall continue in full force and effect after any assignment. The Landlord
shall not assign this Lease or any of its rights, interests, duties or
obligations hereunder.
THUS DONE AND PASSED in ______________, ____________ on the ____ day of
February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with Georgia Gulf and me, Notary, after due reading of the whole.
LANDLORD:
WITNESSES: GEORGIA GULF CORPORATION
By
Title
Notary Public
Printed Name:
My Commission Expires:
THUS DONE AND PASSED in _____________, ______________ on the ____ day of
February, 1996, effective as of the effective date set forth above, in the
presence of the undersigned competent witnesses who hereunto sign their names
with Tenant, Val T. Orton and me, Notary, after due reading of the whole.
WITNESSES: TENANT:
FIRST SECURITY BANK OF UTAH,
N.A., not individually but
solely as Owner Trustee under the GGC Trust
1996-1
By
Title
Val T. Orton, subject to Section 6.9 of the Trust
Agreement, as Owner Trustee
Notary Public
Printed Name:
My Commission Expires:
EXHIBIT A
Legal Description
EXHIBIT B
Roadway Description
EXHIBIT C
Boiler Feedwater System
Chemical Feed System
Wastewater Treatment Facility
Demineralized Water System
Existing Steam Line Infrastructure
Existing Electrical Equipment
VCM Condenses
EXHIBIT 13
Ten-Year Selected Financial Data
Georgia Gulf Corporation and Subsidiaries
Year Ended December 31 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
Results of Operations
(In thousands, except
per share data)
Net sales $1,081,576 $955,305 $768,902 $779,455 $838,336 $932,104 $1,104,468 $1,060,612 $707,435 $583,255
Cost of sales 705,259 677,919 619,540 616,802 626,672 661,448 753,255 698,009 507,028 466,375
Selling and
administrative expenses 48,371 47,164 38,901 33,827 41,129 42,087 52,204 49,489 27,989 31,373
Operating income 327,946 230,222 110,461 128,826 170,535 228,569 299,009 313,114 172,418 85,507
Recapitalization expense - - - - - (17,869) - - - -
Interest expense (25,114) (37,557) (44,779) (61,216) (80,772) (63,161) (961) (3,373) (10,796) (13,184)
Interest income 244 113 106 73 492 2,505 2,045 2,594 1,320 -
Income before income
taxes, extraordinary
charge and cumulative
effect of accounting
change 303,076 192,778 65,788 67,683 90,255 150,044 300,093 312,335 162,942 72,323
Provision for income
taxes 116,582 70,618 23,560 21,346 28,782 54,700 108,103 118,731 71,206 33,200
Income before extraordinary
charge and cumulative
effect of accounting
change 186,494 122,160 42,228 46,337 61,473 95,344 191,990 193,604 91,736 39,123
Extraordinary charge on
early retirement of debt - - (13,267) - - - - - (9,885) -
Cumulative effect of
accounting change for
income taxes - - 12,973 - - - - - - -
Net income $ 186,494 $122,160 $ 41,934 $ 46,337 $ 61,473 $ 95,344 $ 191,990 $ 193,604 $ 81,851 $ 39,123
Net income per common
share $ 4.73 $ 2.88 $ 1.01 $ 1.18 $ 1.75 $ 3.07 $ 7.58 $ 6.75 $ 2.81 $ 1.20
Dividends per common
share $ 0.32 $ - $ - $ - $ - $ - $ 1.00 $ 0.65 $ 0.20 $ -
Financial Highlights (In thousands)
Working capital $ 73,370 $126,668 $ 67,674 $ 57,465 $ 20,676 $ 50,131 $ 132,097 $ 125,642 $ 76,348 $ 63,423
Property, plant and
equipment, net 312,536 255,608 222,835 217,781 226,746 220,851 215,182 175,358 126,086 125,218
Total assets 507,332 508,447 405,287 419,420 415,585 456,657 472,989 457,327 308,609 264,632
Total debt 292,400 314,081 379,206 444,416 639,153 726,481 856 42,603 41,593 83,225
Stockholders' equity
(deficit) 50,628 31,138 (110,577) (161,165) (357,512) (424,476) 330,341 256,083 142,546 77,956
Earnings before interest,
taxes,depreciation and
amortization 360,014 257,996 137,523 158,409 196,982 248,403 317,676 328,703 181,823 103,384
Cash provided by operating
activities 278,641 111,595 88,268 60,385 112,148 127,752 225,255 191,948 118,070 80,745
Depreciation and
amortization 32,068 27,774 27,062 29,583 26,447 19,834 18,667 15,589 9,405 17,877
Capital expenditures 86,278 59,142 29,583 14,261 28,273 58,111 54,159 25,062 9,931 7,428
Maintenance expenditures 51,558 46,033 43,141 47,664 42,853 42,985 40,400 41,469 41,152 37,956
Sales per employee 946 834 684 691 760 868 818 776 712 575
Other Selected Data
Current ratio 1.6 2.0 1.6 1.4 1.1 1.3 2.2 2.0 1.8 1.9
Return on assets 36.7% 26.7% 10.2% 11.1% 14.1% 20.5% 41.3% 50.6% 28.6% 14.1%
Return on sales 17.2% 12.8% 5.5% 5.9% 7.3% 10.2% 17.4% 18.3% 11.6% 6.7%
Ratio of operating income to
interest expense 13.1 6.1 2.5 2.1 2.1 3.6 311.1 92.8 16.0 6.5
Weighted average common shares
and equivalents outstanding
(In thousands) 39,428 42,445 41,672 39,227 35,143 31,069 25,327 28,663 29,061 27,710
Employees 1,143 1,146 1,124 1,128 1,103 1,074 1,350 1,367 993 1,015
All years subsequent to 1989 include the effects of the recapitalization, which
occurred in April 1990 (See note 6 to the consolidated financial statements).
Certain reclassifications of prior years' amounts have been made to conform
with the 1995 presentation.
Management's Discussion and Analysis
Georgia Gulf Corporation and Subsidiaries
Results of Operations
Strong demand from the housing and construction, automobile, and pulp and paper
markets boosted sales to over $1 billion for 1995. Sales volumes remained at
very high levels as the Company operated its facilities at 94 percent of
capacity setting new production volume records. Georgia Gulf capitalized on
the strong demand and the efficiencies gained by these high production rates,
increasing return on sales to 17.2 percent in 1995 from 12.8 percent in 1994.
Georgia Gulf invested $86.3 million of the $278.6 million of cash
provided by operations during 1995 in expansions of existing product lines as
a part of its ongoing capital expansion program. The Company also used $162.6
million of operating cash flow to repurchase 5.2 million shares of its common
stock or 12.3 percent of the total outstanding at the beginning of the year.
This discussion of the Company's financial condition and results of
operations should be read in conjunction with the Company's consolidated
financial statements and related notes thereto.
1995 Compared with 1994
Net income increased 53 percent in 1995 to $186.5 million, compared to net
income of $122.2 million for 1994. Net sales increased 13 percent to $1.1
billion from $955.3 million in 1994 on level sales volumes as sales prices
were up for most products, with the exception of methanol where a decrease
in demand returned prices to more historical levels. Demand was particularly
strong for caustic soda and aromatic products throughout 1995, with
additional support coming from vinyl resins during the first half of the
year. International sales increased to 15 percent of total sales in 1995
from 13 percent in 1994 as a result of stronger export markets. Operating
income was $327.9 million in 1995, an increase of 42 percent over 1994
operating income of $230.2 million. Although the strongest earnings
contributions came from caustic soda, most products showed improved results
as increases in sales prices outpaced higher raw material costs.
Interest expense declined 33 percent to $25.1 million in 1995 from $37.6
million in 1994. This decline was attributable to a lower debt balance in
1995 and reduced interest rates in connection with the redemption of $191.1
million principal amount of the Company's 15% Senior Subordinated Notes in
April 1995.
The effective income tax rate was 38.5 percent for 1995 as compared to
36.6 percent for 1994. The 1995 rate increase was a result of higher taxable
income, which minimized the effect of permanent tax differences.
Earnings per share for 1995 increased 64 percent to $4.73 from $2.88 for
1994 as a result of higher earnings and the effect of the Company's stock
repurchase program.
1994 Compared with 1993
Net income increased 191 percent in 1994 to $122.2 million, or $2.88 per share,
compared to net income of $41.9 million, or $1.01 per share, for 1993. Net
sales increased 24 percent to $955. 3 million from $768.9 million in 1993.
Sales volumes rose 3 percent, surpassing the previous sales volume record set
in 1993. Additionally, sales prices were up for nearly all products, with
the most significant increases coming from methanol and vinyl resins,
followed by caustic soda. International sales increased 19 percent over 1993;
however, these sales declined as a percentage of total sales to 13 percent in
1994 from 14 percent in 1993 as a result of stronger growth in domestic sales.
Operating income was $230.2 million in 1994, an increase of 108 percent
over 1993 operating income of $110.5 million. Although the strongest earnings
contributions came from methanol and caustic soda, substantially all products
showed improved results as increases in sales prices outpaced higher raw
material costs. Selling and administrative expenses increased to $47.2
million for 1994 from $38.9 million in 1993 primarily as a result of higher
compensation expense related to profit sharing programs and stock option plans.
Interest expense declined to $37.6 million in 1994, a 16 percent decrease
from $44.8 million in 1993. The Company's weighted average interest rate
increased slightly; however, a $65.1 million reduction in debt in 1994
enabled the Company to achieve sizable interest savings.
The effective income tax rate was 36.6 percent for 1994 as compared to
35.8 percent for 1993. The 1993 rate included an adjustment of 1.2 percent to
revalue deferred income tax balances for an increase in the federal statutory
rate. Excluding the impact of this 1993 adjustment, the tax rate for 1994
increased two percentage points as a result of higher taxable income, which
minimized the effect of permanent tax differences.
Results for 1993 reflect an extraordinary charge of $13.3 million relating
to an early debt retirement, which was offset by a $13.0 million benefit from a
change in the method of accounting for income taxes.
Liquidity and Capital Resources
Georgia Gulf generated $278.6 million from operating activities during 1995, up
significantly from $111.6 million in 1994. Cash flow increased due to improved
earnings in 1995, along with a decrease in working capital. The majority of
the decrease in working capital in 1995 was attributable to a $50.0 million
sale of trade receiv-ables under a revolving trade receivables sales program
offset in part by a reduction of $18.2 million in accrued income taxes.
Net cash used for financing activities was $191.0 million in 1995,
compared with $54.3 million in 1994, as the Company repurchased approximately
5.2 million shares of common stock in 1995 at a cost of $162.6 million and
began paying quarterly dividends. As of December 31, 1995, the Company had
authorization to retire an additional 2.8 million shares of common stock
under its stock repurchase program. During 1995, the Company declared cash
dividends totalling $0.32 per share at a cost of $12.3 million.
Debt declined during 1995 to a level of $292.4 million. In April 1995,
the 15% Senior Subordinated Notes were redeemed at par for $191.1 million.
Later during the year, the Company entered into a $100 million seven-year
term loan agreement and issued $100 million of 7 5/8% Notes due 2005. The
Company used interest rate swap agreements to fix the interest rate on the
term loan agreement at a rate ranging from 6.71 to 7.04 percent. The Company
does not use interest rate swap agreements or any other derivatives for
trading purposes. As of December 31, 1995, the Company had availability of
$284 million under its $350 million revolving credit facility.
Cash used for investing activities totaled $86.3 million, up from $59.1
million in 1994. The increase resulted primarily from $23.8 million spent on
the expansion of the vinyl chloride monomer ("VCM") plant in Plaquemine, LA;
$14.8 million spent on the vinyl compound expansion in Gallman, MS; and
$14.4 million spent on the cumene upgrade and expansion project at Pasadena,
TX. The balance of the expenditures was primarily used to modernize and
improve the efficiency of existing facilities.
The Company estimates that capital expenditures for 1996 will
approximate $135 million. The major planned capital expenditures for 1996
include the completion of expansions to the VCM and vinyl compound plants and
the completion of the cumene quality upgrade and expansion project, as well
as continuing work on the expansion of the phenol/acetone plant in
Plaquemine, LA.
The Company's primary focus is to maintain debt at a level it considers to
be manageable, regardless of the Company's position in the economic cycle, and
to invest capital in incremental expansions of existing product lines.
Management believes that cash provided by operations of the Company and the
availability of borrowings under the Company's revolving credit facility will
provide sufficient funds to support planned capital expenditures, dividends,
stock repurchases, working capital fluctuations and debt service requirements.
Inflation
The most significant components of the Company's cost of sales are raw
materials and energy, which consist of basic commodity items. The cost of raw
materials and energy is based primarily on market forces and has not been
significantly affected by inflation. Inflation has not had a material impact
on the Company's sales or income from operations.
Environmental
The Company's operations are subject to various federal, state and local laws
and regulations relating to environmental quality. These regulations, which
are enforced principally by the United States Environmental Protection Agency
and comparable state agencies, govern the management of solid and hazardous
waste; emissions into the air and discharges into surface and underground
waters; and the manufacture of chemical substances. All of the plants
operated by the Company meet current environmental standards.
Management believes that the Company is in material compliance with all
current environmental laws and regulations. The Company estimates that any
expenses incurred in maintaining compliance with these requirements will not
materially affect earnings or cause the Company to exceed its level of
anticipated capital expenditures. However, there can be no assurance that
regulatory requirements will not change, and therefore, it is not possible to
accurately predict the aggregate cost of compliance resulting from any such
changes.
Consolidated Balance Sheets
Georgia Gulf Corporation and Subsidiaries
December 31
(In thousands, except share data) 1995 1994
Assets
Current assets
Cash and cash equivalents $ 2,530 $ 1,216
Receivables, net of allowance
for doubtful accounts
of $2,400 in 1995 and 1994 89,414 157,085
Inventories 75,049 70,667
Prepaid expenses 12,108 13,882
Deferred income taxes 8,115 7,069
Total current assets 187,216 249,919
Property, plant and equipment,
at cost 534,264 447,986
Less accumulated depreciation 221,728 192,378
Property, plant and equipment,
net 312,536 255,608
Other assets 7,580 2,920
Total assets $507,332 $508,447
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable $ 78,861 $ 73,771
Interest payable 2,737 6,424
Accrued income taxes 3,296 21,537
Accrued compensation 14,715 11,724
Accrued pension 2,307 3,276
Other accrued liabilities 11,930 6,519
Total current liabilities 113,846 123,251
Long-term debt 292,400 314,081
Deferred income taxes 50,458 39,977
Stockholders' equity
Preferred stock - $.01 par value;
75,000,000 shares authorized;
no shares issued - -
Common stock - $.01 par value;
75,000,000 shares authorized;
shares issued and outstanding:
37,240,252 in 1995 and
42,013,116 in 1994 372 420
Additional paid-in capital 31,312 185,984
Retained earnings (deficit) 18,944 (155,266)
Total stockholders' equity 50,628 31,138
Total liabilities and
stockholders' equity $507,332 $508,447
The accompanying notes are an integral part of these consolidated financial
statements.
Consolidated Statements of Income
Georgia Gulf Corporation and Subsidiaries
Year Ended December 31
(In thousands, except share data) 1995 1994 1993
Net sales $1,081,576 $955,305 $768,902
Operating costs and expenses
Cost of sales 705,259 677,919 619,540
Selling and administrative 48,371 47,164 38,901
Total operating costs and
expenses 753,630 725,083 658,441
Operating income 327,946 230,222 110,461
Other income (expense)
Interest expense (25,114) (37,557) (44,779)
Interest income 244 113 106
Income before income taxes,
extraordinary charge and
cumulative effect of accounting
change 303,076 192,778 65,788
Provision for income taxes 116,582 70,618 23,560
Income before extraordinary charge and
cumulative effect of accounting
change 186,494 122,160 42,228
Extraordinary charge on early retirement
of debt, net of tax benefit of $6,834
(Note 5) - - (13,267)
Cumulative effect of accounting change
for income taxes (Note 9) - - 12,973
Net income $ 186,494 $122,160 $ 41,934
Primary and fully diluted net income
per common share:
Before extraordinary charge and
cumulative effect of accounting
change $ 4.73 $ 2.88 $ 1.01
Extraordinary charge on early
retirement of debt - - (0.32)
Cumulative effect of accounting change
for income taxes - - 0.32
Net income per common share $ 4.73 $ 2.88 $ 1.01
Weighted average common shares and
equivalents outstanding 39,427,943 42,445,499 41,671,903
The accompanying notes are an integral part of these consolidated financial
statements.
Consolidated Statements of Cash Flows
Georgia Gulf Corporation and Subsidiaries
Year Ended December 31
(In thousands) 1995 1994 1993
Cash flows from operating activities
Net income $186,494 $122,160 $ 41,934
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 32,068 27,774 27,062
Deferred income taxes 9,435 1,823 2,486
Cost associated with early retirement
of debt - - 20,101
Cumulative effect of accounting change
for income taxes - - (12,973)
Compensation and tax benefit related
to stock plans 2,364 8,766 1,934
Change in assets and liabilities:
Receivables 67,671 (61,017) 5,800
Inventories (4,382) (12,406) 13,004
Prepaid expenses 1,774 (3,532) 705
Accounts payable 5,090 13,860 (7,256)
Interest payable (3,687) (10,400) (2,678)
Accrued income taxes (18,241) 18,408 2,952
Accrued compensation 2,991 8,151 248
Accrued pension (969) (1,394) (1,418)
Accrued liabilities 5,411 (1,188 ) (227)
Other (7,378) 590 (3,406)
Net cash provided by operating activities 278,641 111,595 88,268
Cash flows from financing activities:
Net (decrease) increase in revolving
credit loan (42,600) 17,000 79,000
Proceeds from issuance of long-term debt 212,000 1,000 150,000
Principal payments on long-term debt (191,081) (83,125) (294,210)
Proceeds from issuance of common stock 5,481 10,789 6,720
Purchase and retirement of common stock (162,565) - -
Dividends paid (12,284) - -
Net cash used in financing activities (191,049) (54,336) (58,490)
Cash flows from investing activities:
Capital expenditures (86,278) (59,142) (29,583)
Net cash used in investing activities (86,278) (59,142) (29,583)
Net increase (decrease) in cash and
cash equivalents 1,314 (1,883) 195
Cash and cash equivalents at beginning of year 1,216 3,099 2,904
Cash and cash equivalents at end of year $2,530 $ 1,216 $ 3,099
The accompanying notes are an integral part of these consolidated financial
statements.
Consolidated Statements of Changes in
Stockholders' Equity (Deficit)
Georgia Gulf Corporation and Subsidiaries
Additional Retained Total
Common Stock Paid-in Earnings Stockholders'
(In thousands, except share data) Shares Amount Capital (Deficit) Equity (Deficit)
Balance, December 31, 1992 40,293,639 $403 $157,792 $(319,360) $(161,165)
Net income - - - 41,934 41,934
Tax benefit realized from
stock option plans - - 1,934 - 1,934
Common stock issued upon
exercise of stock options 450,425 5 3,474 - 3,479
Common stock issued under
stock purchase plan 207,507 2 3,239 - 3,241
Balance, December 31, 1993 40,951,571 410 166,439 (277,426) (110,577)
Net income - - - 122,160 122,160
Tax benefit realized from
stock option plans - - 6,291 - 6,291
Compensation related to
stock option plans - - 2,475 - 2,475
Common stock issued upon
exercise of stock options 809,605 8 6,753 - 6,761
Common stock issued under
stock purchase plan 251,940 2 4,026 - 4,028
Balance, December 31, 1994 42,013,116 420 185,984 (155,266) 31,138
Net income - - - 186,494 186,494
Dividends paid - - - (12,284) (12,284)
Tax benefit realized from
stock option plans - - 2,364 - 2,364
Common stock issued upon
exercise of stock options 270,214 3 2,139 - 2,142
Common stock issued under
stock purchase plan 127,722 1 3,338 - 3,339
Purchase and retirement
of common stock (5,170,800 (52) (162,513) - (162,565)
Balance, December 31, 1995 37,240,252 $372 $ 31,312 $ 18,944 $ 50,628
The accompanying notes are an integral part of these consolidated financial
statements.
Notes to Consolidated Financial Statements
Georgia Gulf Corporation and Subsidiaries
Note 1: Summary of Significant Accounting Policies
Principles of Consolidation - The consolidated financial statements include
the accounts of Georgia Gulf Corporation and its subsidiaries (the "Company").
All significant intercompany balances and transactions are eliminated in
consolidation.
Nature of Operations - The Company is a manufacturer and marketer of chemical
and plastics products. The Company's products are primarily intermediate
chemicals sold for further processing into a wide variety of end-use
applications including plastic piping, siding and window frames, bonding
agents for wood products, high-quality plastics, acrylic sheeting and
gasoline additives.
Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amount of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenue and expenses
during the reporting period. Actual results could differ from those
estimates.
Cash and Cash Equivalents - The Company considers all highly liquid
investment instruments with an original maturity of three months or less to
be the equivalent of cash for the purposes of balance sheet and statement of
cash flow presentations.
Inventories - Inventories are valued at the lower of cost (first-in,
first-out) or market. Costs include raw materials, direct labor and
manufacturing overhead. Market is based on current replacement cost for raw
materials and supplies and on net realizable value for finished goods.
Property, Plant and Equipment - Property, plant and equipment are stated at
cost. Maintenance and repairs are charged to expense as incurred, and major
renewals and improvements are capitalized. Interest expense attributable to
funds used in financing the construction of major plant and equipment is
capitalized. Depreciation is computed using the straight-line method over
the estimated useful lives of the assets for book purposes, with accelerated
methods being used for income tax purposes.
The estimated useful lives of the assets are as follows:
Buildings and land improvements 20-30 years
Machinery and equipment 3-15 years
Other Assets - Other assets are comprised primarily of debt issuance costs
that are amortized to expense using the effective interest method over the
term of the related indebtedness. Debt issuance costs of $3,799,000,
primarily related to the 7 5/8% Notes due 2005 (the "Notes"), were
capitalized in 1995. Debt issuance costs amortized to interest expense
during 1995, 1994 and 1993 were $420,000, $792,000 and $961,000,
respectively. Debt issuance costs of $10,169,000 were written off during
1993 as part of the extraordinary charge on early retirement of debt
(Note 5).
Environmental Expenditures - Environmental expenditures related to current
operations or future revenues are expensed or capitalized consistent with
the Company's capitalization policy. Expenditures that relate to an existing
condition caused by past operations and do not contribute to future
revenues are expensed. Liabilities are recognized when environmental
assessments or cleanups are probable and the costs can be reasonably
estimated.
Net Income per Common Share - Primary and fully diluted net income per
common share is based upon the weighted average common shares and equivalents
outstanding during the year.
New Accounting Pronouncement - The Financial Accounting Standards Board
issued Statement of Financial Accounting Standards ("SFAS") No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of," which became effective for fiscal years beginning
after December 1995. SFAS No. 121 establishes, among other things, accounting
standards for the impairment of long-lived assets and certain identified
intangibles. The Company will adopt the new standard in 1996, but does not
anticipate any material impact to the financial statements.
Note 2: Receivables
In May 1995, the Company entered into an agreement which allows for the sale,
without recourse, of fractional interests in a defined pool of trade
receivables for up to $50,000,000. This agreement expires May 1996, but may
be extended for additional one-year terms by the mutual consent of the
Company and the receivables purchaser. At December 31, 1995, $50,000,000 had
been sold under this agreement, and the sale was reflected as a reduction
of receivables in the accompanying consolidated balance sheet and as an
operating activity in the accompanying consolidated statement of cash flows.
On-going costs of this program of $2,003,000 were charged to selling and
administrative expense in the accompanying consolidated statement of income.
Note 3: Inventories
The major classes of inventories were as follows (in thousands):
December 31,
1995 1994
Raw materials and supplies $23,973 $25,019
Finished goods 51,076 45,648
$75,049 $70,667
Note 4: Property, Plant and Equipment
Property, plant and equipment consisted of the following (in thousands):
December 31,
1995 1994
Machinery and equipment $427,370 $390,658
Land and improvements 23,369 23,350
Buildings 13,289 13,006
Construction in progress 70,236 20,972
Property, plant and equipment, at cost $534,264 $447,986
Note 5: Long-Term Debt
Long-term debt consisted of the following (in thousands):
December 31,
1995 1994
Revolving credit loan $ 66,000 $110,000
Term Loan 100,000 -
7 5/8% Notes due 2005 100,000 -
15% Senior Subordinated Notes - 191,081
Other 26,400 13,000
Long-term debt $292,400 $314,081
During March 1995, the Company refinanced its credit agreement with a
group of financial institutions (the "Credit Agreement") to allow for
reduced interest rates, less restrictive covenants and increased financial
flexibility. The Credit Agreement provides for an unsecured revolving credit
facility which permits borrowings of up to $350,000,000. The revolving credit
facility terminates and related outstanding loans, if any, are due in
March 2000. The costs incurred in connection with the refinancing were not
material.
As of December 31, 1995, the Company had availability to borrow up to
$284,000,000 under the terms of the revolving credit facility. An annual
commitment fee which ranges from 0.10 to 0.25 percent is required to be paid
on the revolving credit facility commitment. The interest rate on the
revolving credit facility is based on LIBOR and averaged 6.27 and 5.25
percent for 1995 and 1994, respectively.
In April 1995, the Company redeemed, at par, $191,081,000 outstanding
principal amount of the 15% Senior Subordinated Notes, which would have
been due April 2000. The write-off of the remaining unamortized debt
issuance costs related to the 15% Senior Subordinated Notes was not material.
The Company entered into a $100,000,000 unsecured term loan agreement
in June 1995 (the "Term Loan"). Required principal payments under the Term
Loan are $25,000,000 in June 2001 and $75,000,000 in June 2002. The LIBOR-
based variable interest rate on the Term Loan has been fixed at a rate
ranging from 6.71 to 7.04 percent using interest rate swap agreements.
The average rate on the Term Loan was 6.78 percent during 1995.
In November 1995, the Company issued $100,000,000 of unsecured 7 5/8%
Notes, which are due in November 2005. Interest on the Notes is payable
semiannually on May 15 and November 15 of each year, commencing May 15, 1996.
The Notes are not redeemable prior to maturity.
Under the Credit Agreement, Term Loan and Notes, the Company is subject
to certain restrictive covenants, the most significant of which require the
Company to maintain certain financial ratios and limit the amount the Company
can pay for dividends and repurchases of common stock.
During 1993, the Company refinanced its senior debt and incurred an
extraordinary charge of $13,267,000, net of an income tax benefit of
$6,834,000.
Cash payments for interest during 1995, 1994 and 1993 were $28,336,000,
$43,045,000 and $48,391,000, respectively.
Note 6: Stockholders' Equity
In April 1990, the Company's stockholders approved a Plan of Recapitalization
(the "Recapitalization"), which resulted in an increase of 9,158,660
outstanding common shares and a distribution to stockholders of $864,733,000.
The distribution for the Recapitalization, net of certain tax benefits,was
charged against retained earnings.
During 1995, the Company purchased 5,170,800 shares of common stock for
$162,565,000. As of December 31, 1995, the Company had authorization to
purchase up to 2,799,200 additional shares under the current common stock
repurchase program.
In connection with the stock purchase rights described below, 30,000,000
of the authorized shares of preferred stock are designated Junior
Participating Preferred Stock. If issued, the Junior Participating Preferred
Stock would be entitled, subject to the prior rights of any senior preferred
stock, to a dividend equal to the greater of $0.01 or that which is paid on
the common shares.
Each outstanding share of common stock is accompanied by a preferred
stock purchase right, which entitles the holder to purchase from the Company
1/100th of a share of Junior Participating Preferred Stock for $45.00,
subject to adjustment in certain circumstances. The rights become exercisable
only after a person or group acquires beneficial ownership of 15 percent or
more of the Company's outstanding shares of common stock, or commences a
tender or exchange offer that would result in such person or group
beneficially owning 15 percent or more of the Company's outstanding shares of
common stock. The rights expire on April 27, 2000, and may be redeemed by the
Company for $0.01 per right until ten days following the earlier to occur of
the announcement that a person or group beneficially owns 15 percent or more
of the Company's outstanding shares of common stock, or the commencement,
or announcement by any person or group of an intent to commence, a tender
offer which would result in any person or group beneficially owning 15
percent or more of the Company's outstanding shares of common stock. Subject
to certain conditions, if a person or group becomes the beneficial owner of 15
percent or more of the Company's outstanding shares of common stock, each
right will entitle its holder (other than certain acquiring persons) to
receive, upon exercise, common stock having a value equal to two times the
right's exercise price. In addition, subject to certain conditions, if the
Company is involved in a merger or certain other business combination
transactions, each right will entitle its holder (other than certain
acquiring persons) to receive, upon exercise, common stock of the acquiring
company having a value equal to two times the right's exercise price.
Note 7: Stock Option and Purchase Plans
Stock Option Plans - During 1987, the Board of Directors approved a
nonqualified stock option plan that provided for granting key employees
options to purchase up to 484,820 shares of common stock. All options were
granted with related cash awards payable upon exercise to compensate for tax
consequences. All stock options related to this plan have vested and expire
no more than ten years after grant. No compensation expense related to these
options and accompanying cash awards was recorded in 1995, while $3,827,000
was recorded in 1994 and none in 1993. As of December 31, 1995, options
to purchase 135,700 shares under this plan were outstanding.
The 1990 Incentive Equity Plan was approved by the stockholders of the
Company as a part of the Recapitalization. This plan authorized the issuance
of nonqualified stock options for up to 2,763,027 shares, of which, options
for 1,163,331 shares were outstanding as of December 31, 1995. The option
price per share may not be less than the fair market value of a share of the
Company's common stock on the dates the options are granted. Options vest
ratably over a three- or five-year period from the date of grant and expire
no more than ten years after grant.
The following is a summary of all stock option information:
Year Ended December 31,
1995 1994 1993
Stock options:
Outstanding at beginning of year 1,569,245 2,170,800 2,504,015
Granted at $17.00-$36.50
per share - 210,000 179,650
Exercised (270,214) (809,605) (450,425)
Forfeited or canceled - (1,950) (62,440)
Outstanding at end of year 1,299,031 1,569,245 2,170,800
Option exercise price range per
share $3.07-$36.50 $3.07-$36.50 $3.07-$18.25
Options exercisable 1,131,031 1,359,245 1,242,250
Options available for grant 13,827 13,827 221,877
Stock Purchase Plan - During 1995, the Board of Directors authorized, subject
to stockholder approval, the Employee Stock Purchase Plan. In connection
with this stock purchase plan, 800,000 shares of common stock are reserved
for future issuances. On December 29, 1995, approximately 148,000 shares
were subscribed under the employee stock purchase plan at a subscription
price equal to the lower of 85 percent of the fair market price of the
Company's common stock on either December 29, 1995 or December 31, 1996.
The subscription price is paid through payroll deductions over a twelve-month
period ending December 1996. Under similar employee stock purchase plans,
127,722, 251,940 and 207,507 shares of common stock were issued at $26.14,
$15.99 and $15.62 per share during 1995, 1994 and 1993, respectively.
Note 8: Employee Benefit Plans
The Company has certain pension, savings and profit sharing plans that cover
substantially all of its employees. The expense incurred for these plans was
approximately $5,551,000, $5,431,000 and $5,263,000 for the years ended
December 31, 1995, 1994 and 1993, respectively.
Employees are covered by defined contribution plans under which the
Company makes contributions to individual employee accounts and by defined
benefit plans for which the benefits are based on years of service and the
employee's compensation or for which the benefit is a specific monthly amount
for each year of service. The Company's policy on funding the defined benefit
plans is to contribute an amount within the range of the minimum required
and the maximum tax deductible contribution.
The net pension costs for the defined benefit plans include the following
components (in thousands):
Year ended December 31,
1995 1994 1993
Service cost for benefits earned
during the year $1,776 $1,853 $1,530
Interest cost on projected benefit
obligation 2,527 2,229 2,043
Actual return on assets (7,983) (304) (1,783)
Net amortization and deferrals 5,920 (1,487) 434
Net pension cost $2,240 $2,291 $2,224
The pension expense was calculated using assumed discount rates of 7.5
percent in 1995, 7 percent in 1994 and 8 percent in 1993; assumed long-term
compensation increase rates of 5.5 percent in 1995 and 1994 and 6.5 percent
in 1993; and assumed long-term rates of return on plan assets of 9 percent
in 1995 and 1994 and 8 percent in 1993.
The funded status of the defined benefit plans at December 31, 1995 and
1994 was as follows (in thousands):
1995 1994
Unfunded Unfunded
Fully Funded Executive Fully Funded Executive
Benefit Plans Benefit Plan Benefit Plans Benefit Plan
Actuarial present value of:
Vested benefit obligation $(21,308) $(4,815) $(16,963) $(4,420)
Non-vested benefit obligation (413) (541) (367) (390)
Accumulated benefit obligation $(21,721) $(5,356) $(17,330) $(4,810)
Projected benefit obligation $(31,831) $(7,322) $(24,783) $(7,933)
Plan assets at fair value 39,171 - 28,046 -
Fair value of assets in excess of (less than)
projected benefit obligation 7,340 (7,322) 3,263 (7,933)
Unrecognized net (gains) and losses (5,301) (5) (3,414) 900
Unrecognized prior service cost (804) 1,764 (858) 1,920
Unrecognized transition obligation 2,256 1,002 2,454 1,147
Additional minimum liability - (966) - (1,069)
Prepaid pension expense (liability) $ 3,491 $(5,527) $ 1,445 $(5,035)
The projected benefit obligation for the defined benefit plans was
determined using assumed discount rates of 7 and 7.5 percent in 1995 and 1994,
respectively, and an assumed long-term compensation increase rate of 5.5
percent in 1995 and 1994. The plan assets are invested in a diversified
portfolio that consists primarily of equity and debt securities.
Note 9: Income Taxes
Effective January 1, 1993, the Company adopted SFAS No. 109, "Accounting for
Income Taxes," which changed the Company's method of accounting for income
taxes from the deferred method to the liability method. Under the liability
method, deferred tax balances are determined based on the estimated future
tax effects of differences between the financial statement and tax bases of
assets and liabilities under currently enacted tax laws. As a result of
the adoption of SFAS No. 109, the Company recorded a cumulative adjustment
at January 1, 1993 of $12,973,000. This adjustment represents a net decrease
in the deferred tax liability as of that date and is reflected in the
accompanying consolidated statements of income as the cumulative effect of
accounting change.
The provision for income taxes was as follows (in thousands):
Year Ended December 31,
1995 1994 1993
Current:
Federal $ 94,068 $59,825 $18,955
State 13,079 8,970 2,119
107,147 68,795 21,074
Deferred:
Federal 8,812 2,123 2,050
State 623 (300) 436
9,435 1,823 2,486
Provision for income taxes $116,582 $70,618 $23,560
The difference between the statutory federal income tax rate and the
Company's effective income tax rate is summarized as follows:
Year Ended December 31,
1995 1994 1993
Statutory federal income tax rate 35.0% 35.0% 35.0%
State income taxes, net of federal benefit 2.9 2.8 2.5
Percentage depletion (0.2) (0.7) (2.9)
Revalue deferred tax balances for increase
in federal statutory rate - - 1.2
Other 0.8 (0.5) -
Effective income tax rate 38.5% 36.6% 35.8%
Cash payments for income taxes during 1995, 1994 and 1993 were
$133,170,000, $44,096,000 and $9,355,000, respectively.
The Company's net deferred tax liability consisted of the following
major items (in thousands):
December 31,
1995 1994
Deferred tax assets:
Receivables $ 602 $ 1,005
Inventories 1,288 945
Vacation accruals 1,403 1,291
Pension accruals - 1,641
Stock options 2,813 3,023
Other 2,009 3,552
Total deferred tax assets 8,115 11,457
Deferred tax liability:
Property, plant and equipment (50,458) (44,365)
Net deferred tax liability $(42,343) $(32,908)
The Company has determined, based on its history of operating earnings
and expectations for the future, that it is more likely than not that
future taxable income will be sufficient to fully utilize the deferred
tax assets at December 31, 1995.
Note 10: Commitments and Contingencies
Leases - The Company leases railcars, storage terminals, warehouse and
office space under noncancelable operating leases with varying maturities
through the year 2010.
Future minimum payments under noncancelable operating leases as of
December 31, 1995 were $13,352,000 for 1996, $10,243,000 for 1997, $7,906,000
for 1998, $7,035,000 for 1999, $4,532,000 for 2000 and $22,861,000
thereafter. Total lease expense was approximately $12,465,000, $10,767,000
and $12,316,000 for the years ended December 31, 1995, 1994 and 1993,
respectively.
Lease Subsequent Event - In February 1996, the Company entered into an
operating lease agreement for a 250 megawatt co-generation facility to be
constructed at the Company's Plaquemine, LA complex. The total cost of assets
to be covered by the lease is limited to $120,000,000. The co-generation
facility, scheduled for completion during the third quarter of 1997, will
supply essentially all electricity and steam requirements for the Plaquemine
location. Payments under the lease will be determined and will commence upon
completion of construction and will continue through the initial lease
term of three years. The Company has options to renew the lease for two
one-year periods and to purchase the facility at its estimated fair market
value at any time during the lease term. The lease provides for substantial
residual value guarantees by the Company at the termination of the lease.
Legal Proceedings - The Company is subject to claims and legal actions that
arise in the ordinary course of its business. Management believes that the
ultimate liability, if any, with respect to these claims and legal actions,
will not have a material effect on the financial position or on results
of operations of the Company.
Note 11: Significant Customer and Export Sales
Significant Customer - The Company has supply contracts, subject to certain
limitations, for a substantial percentage of Georgia-Pacific Corporation's
requirements for certain chemicals at market prices. These supply contracts
have various expiration dates (depending on the product) from 1996 through
1999 and may be extended year-to-year upon expiration. The sales to
Georgia-Pacific Corporation under these supply contracts for the years ended
December 31, 1995, 1994 and 1993 amounted to approximately 14 percent, 15
percent and 15 percent of net sales, respectively. Receivables outstanding
from these sales were $12,474,000, $16,939,000 and $12,661,000 at December
31, 1995, 1994 and 1993, respectively.
Export Sales - Export sales were approximately 15 percent, 13 percent and 14
percent of the Company's net sales for the years ended December 31, 1995,
1994 and 1993, respectively. The principal international markets served by
the Company include Canada, Mexico, Latin America, Europe and Asia.
Note 12: Derivative Financial Instruments and Fair Value of Financial
Instruments
The Company does not use derivatives for trading purposes. Interest rate
swaps, a form of derivative, are used to manage interest costs. The Company
entered into two interest rate swap agreements in June 1995, for a total
notional amount of $100,000,000 maturing in June 2000, to fix the interest
rate on the Term Loan. As of December 31, 1995, these interest rate swap
agreements were the only derivative financial instruments outstanding.
The following methods and assumptions were used to estimate the fair
value of each class of financial instruments:
Debt - The fair value of the 15% Senior Subordinated Notes and Notes was
based on quoted market prices. The carrying amounts of the revolving credit
loan and the Term Loan were assumed to approximate fair value due to the
floating market interest rates to which the respective agreements are subject.
Interest Rate Swap Agreements - The fair value of the interest rate swap
agreements was estimated by obtaining quotes from brokers.
The estimated fair value of financial instruments was as follows
(in thousands):
December 31, December 31,
1995 1994
Carrying Fair Carrying Fair
Amount Value Amount Value
Debt:
Revolving credit loan $ 66,000 $ 66,000 $110,000 $110,000
Term Loan 100,000 100,000 - -
7 5/8% Notes due 2005 100,000 102,364 - -
15% Senior Subordinated Notes - - 191,081 195,858
Other 26,400 26,400 13,000 13,000
Liabilities for interest rate swap agreements - 3,648 - -
Note 13: Quarterly Financial Data (Unaudited)
The following table sets forth certain quarterly financial data for the
periods indicated (in thousands, except per share data):
First Second Third Fourth
Quarter Quarter Quarter Quarter
1995
Net sales $314,026 $275,833 $270,877 $220,840
Gross margin 118,187 101,760 88,673 67,697
Operating income 106,604 89,487 77,202 54,653
Net income 60,157 50,793 44,482 31,062
Net income per common share 1.44 1.30 1.15 0.82
Dividends declared per common share 0.08 0.08 0.08 0.08
1994
Net sales $192,906 $208,188 $249,044 $305,167
Gross margin 39,186 51,846 72,844 113,510
Operating income 29,299 40,374 59,405 101,144
Net income 12,730 19,952 31,830 57,648
Net income per common share 0.30 0.47 0.75 1.35
Dividends declared per common share - - - -
Report of Management
Georgia Gulf Corporation and Subsidiaries
To the Stockholders of Georgia Gulf Corporation:
The accompanying consolidated financial statements of Georgia Gulf
Corporation and subsidiaries are the responsibility of and have been prepared
by the Company in conformity with generally accepted accounting principles.
The financial information displayed in other sections of this Annual Report
is consistent with the consolidated financial statements.
The integrity and the objectivity of the data in these consolidated
financial statements, including estimates and judgments relating to matters
not concluded by year-end, are the responsibility of management. The Company
and its subsidiaries maintain accounting systems and related internal
controls, including a detailed budget and reporting system, to provide
reasonable assurance that financial records are reliable for preparing the
consolidated financial statements and for maintaining accountability for
assets. The system of internal controls also provides reasonable assurance
that assets are safeguarded against loss from unauthorized use or
disposition and that transactions are executed in accordance with
management's authorization. Periodic reviews of the systems and of internal
controls are performed by the Company's internal audit department.
The Audit Committee of the Board of Directors, composed solely of
outside directors who are not officers or employees of the Company, has the
responsibility of meeting periodically with management, the Company's
internal auditors and Arthur Andersen LLP, the Company's independent public
accountants that are approved by the stockholders, to review the scope and
results of the annual audit, quarterly reviews and the general overall
effectiveness of the internal accounting control system. The independent
public accountants and the Company's internal auditors have direct access to
the Audit Committee, with or without the presence of management, to discuss
the scope and results of their audits as well as any comments they may have
related to the adequacy of the internal accounting control system and the
quality of financial reporting.
Richard B. Marchese
Vice President - Finance
Chief Financial Officer and Treasurer
February 15, 1996
Report of Independent Public Accountants
Georgia Gulf Corporation and Subsidiaries
To the Stockholders and Board of Directors of Georgia Gulf Corporation:
We have audited the accompanying consolidated balance sheets of Georgia Gulf
Corporation (a Delaware corporation) and subsidiaries as of December 31, 1995
and 1994, and the related consolidated statements of income, changes in
stockholders' equity (deficit) and cash flows for each of the three years in
the period ended December 31, 1995. These financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Georgia Gulf
Corporation and subsidiaries as of December 31, 1995 and 1994, and the
results of their operations and their cash flows for each of the three years
in the period ended December 31, 1995, in conformity with generally accepted
accounting principles.
As discussed in note 9 of the Notes to Consolidated Financial Statements,
effective January 1, 1993, the Company changed its method of accounting
for income taxes.
Arthur Andersen LLP
Atlanta, Georgia
February 15, 1996
Common Stock Data
Georgia Gulf Corporation's Common Stock is listed on the New York Stock
Exchange under the symbol GGC.
At December 29, 1995, there were 1,043 common stockholders of record.
The following table sets forth the New York Stock Exchange high, low and
closing stock prices for the Company's common stock for the years 1995
and 1994.
1995
(in dollars) High Low Close
First Quarter 40 3/4 26 5/8 29 7/8
Second Quarter 34 1/4 28 1/8 32 5/8
Third Quarter 37 1/2 32 1/4 34 1/2
Fourth Quarter 37 5/8 30 1/2 30 3/4
1994
(in dollars) High Low Close
First Quarter 29 1/2 21 5/8 25 3/8
Second Quarter 35 24 3/8 34 1/4
Third Quarter 42 32 5/8 40 1/8
Fourth Quarter 43 1/4 32 3/8 38 7/8
EXHIBIT 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
of our reports included and incorporated by reference in this Form 10-K,
into the Company's previously filed Registration Statements on Form S-8,
file no. 33-14696, file no. 33-27365, file no. 33-40952, file no. 33-42008,
file no. 33-42190, file no. 33-56711 and file no. 33-64749.
ARTHUR ANDERSEN LLP
Atlanta, Georgia
March 27, 1996