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Exhibit 10.1
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AMENDED AND RESTATED PARTICIPATION AGREEMENT
Dated as of March 19, 2004
Among
REEBOK INTERNATIONAL LTD.,
as Lessee and as Guarantor,
CREDIT SUISSE LEASING 92A, L.P.,
as Lessor,
THE PERSONS NAMED ON SCHEDULE II,
as Lenders
and
CREDIT SUISSE FIRST BOSTON,
as Administrative Agent,
FLEET NATIONAL BANK,
as Co-Documentation Agent,
SCOTIABANC INC.,
As Co-Documentation Agent,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Co-Syndication Agent,
and
BNP PARIBAS LEASING CORPORATION,
As Co-Syndication Agent
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CREDIT SUISSE FIRST BOSTON,
as Arranger
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TABLE OF CONTENTS
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PAGE
ARTICLE I DEFINITIONS...............................................................................2
1.1 Definitions...................................................................................2
ARTICLE II EFFECTIVENESS; ACQUISITION AND LEASE; GENERAL PROVISIONS..................................3
2.1 Effectiveness of Agreement....................................................................3
2.2 Agreement to Acquire and Lease................................................................3
2.3 Participation by Lenders and Lessor...........................................................4
2.4 Advance Dates.................................................................................5
2.5 Commitment Fee; Administration Fee............................................................6
2.6 Payments to Participants......................................................................7
2.7 Computations..................................................................................7
2.8 Renewal Term..................................................................................8
2.9 Highest Lawful Rate...........................................................................8
2.10 Conversion Options............................................................................8
2.11 Replacement of Lenders........................................................................9
ARTICLE III CONDITIONS TO DOCUMENTATION DATE AND ADVANCES.............................................9
3.1 Conditions Precedent To Documentation Date....................................................9
3.2 Conditions to All Advances...................................................................13
3.3 Conditions to Acquisition of the Additional Property.........................................14
ARTICLE IV REPRESENTATIONS AND WARRANTIES...........................................................18
4.1 Representations and Warranties of Lessee.....................................................18
4.2 Representations and Warranties of Each Participant...........................................25
ARTICLE V COVENANTS OF LESSEE......................................................................27
5.1 Further Assurances...........................................................................27
5.2 Limitation on Fundamental Changes............................................................27
5.3 [Reserved]...................................................................................27
5.4 [Reserved]...................................................................................27
5.5 Liens........................................................................................27
5.6 Limitation on Sale of Assets.................................................................27
5.7 Change of Name or Address....................................................................28
5.8 Environmental Matters........................................................................28
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5.9 Investigation by Authorities.................................................................28
5.10 Financial Statements; Certificates; Other Information........................................28
5.11 Securities...................................................................................30
5.12 Interest Rates...............................................................................30
5.13 Payment of Obligations.......................................................................30
5.14 Conduct of Business and Maintenance of Existence.............................................30
5.15 Maintenance of Property; Insurance...........................................................30
5.16 Inspection of Property; Books and Records; Discussions.......................................31
5.17 Notices......................................................................................31
5.18 Financial Condition Covenants................................................................32
5.19 Limitation on Transactions with Affiliates...................................................32
ARTICLE VI OTHER COVENANTS AND AGREEMENTS...........................................................33
6.1 Cooperation with Lessee......................................................................33
6.2 Covenants of Lessor..........................................................................33
6.3 Restrictions on and Effect of Transfer.......................................................34
6.4 Covenants and Agreements of Lenders..........................................................35
6.5 Future Lenders...............................................................................36
6.6 Administrative Agent under Participation Agreement and Mortgage..............................36
ARTICLE VII INDEMNIFICATION..........................................................................36
7.1 General Indemnification......................................................................36
7.2 General Tax Indemnity........................................................................38
7.3 Withholding Tax Exemption....................................................................40
7.4 Excessive Use Indemnity......................................................................41
7.5 Gross Up.....................................................................................41
ARTICLE VIII MISCELLANEOUS............................................................................42
8.1 Survival of Agreements.......................................................................42
8.2 No Broker, etc...............................................................................42
8.3 Notices......................................................................................42
8.4 Counterparts.................................................................................42
8.5 Amendments...................................................................................42
8.6 Headings, etc................................................................................43
8.7 Parties in Interest..........................................................................43
8.8 GOVERNING LAW................................................................................44
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8.9 Payment of Transaction Costs and Other Costs.................................................44
8.10 Severability.................................................................................44
8.11 Limited Liability of Lessor..................................................................44
8.12 Liabilities of the Participants..............................................................45
8.13 Liabilities of Administrative Agent..........................................................45
8.14 Reproduction of Documents....................................................................45
8.15 Estoppel Certificates........................................................................45
8.16 Notices to Lessor under Loan Agreement.......................................................46
8.17 Confidentiality..............................................................................46
8.18 SUBMISSION TO JURISDICTION; WAIVERS..........................................................47
8.19 Final Agreement..............................................................................47
8.20 Right of Set-Off.............................................................................47
8.21 USA Patriot Act Notice.......................................................................48
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TABLE OF CONTENTS
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APPENDIX 1 Definitions
APPENDIX 2 [RESERVED]
APPENDIX 3 Commitment Fee Rate
SCHEDULE I Lessor Commitment
SCHEDULE II Lenders' Commitments
SCHEDULE III Addresses For Notice; Wire Instructions
SCHEDULE 4.1A Filings and Recordings
SCHEDULE 4.1B Domestic Subsidiaries
SCHEDULE 4.1C Foreign Subsidiaries
EXHIBIT A Form of Lease
EXHIBIT B Form of Advance Request
EXHIBIT C Form of Loan Agreement
Exhibit A - Form of Note
EXHIBIT D [RESERVED]
EXHIBIT E-1 Form of Mortgage for Original Property
EXHIBIT E-2 Form of Mortgage for Additional Property
EXHIBIT F Form of Environmental Certificate
EXHIBIT G - 1 Form of Opinion of Ropes & Gray
EXHIBIT G - 2 Form of Opinion of David A. Pace, General Counsel of Lessee
EXHIBIT H Form of Officer's Certificate
EXHIBIT I Form of Investor's Letter
EXHIBIT J Form of Assignment of Lease
EXHIBIT K [RESERVED]
EXHIBIT L Form of Guaranty
EXHIBIT M Form of Secretary's Certificate
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Participation Agreement
THIS AMENDED AND RESTATED PARTICIPATION AGREEMENT, dated as of March 19,
2004 (this "AGREEMENT"), is among REEBOK INTERNATIONAL LTD., a Massachusetts
corporation (the "LESSEE" or the "COMPANY"), as Lessee and as Guarantor; CREDIT
SUISSE LEASING 92A, L.P. (the "LESSOR"), as Lessor; the Persons named on
SCHEDULE II hereto as lenders (together with their respective permitted
successors, assigns and transferees) (the "LENDERS"), as Lenders; CREDIT SUISSE
FIRST BOSTON (the "ADMINISTRATIVE AGENT"), as Administrative Agent; FLEET
NATIONAL BANK and SCOTIABANC INC. (the "CO-DOCUMENTATION AGENTS"), as
Co-Documentation Agents, WACHOVIA BANK, NATIONAL ASSOCIATION and BNP PARIBAS
LEASING CORPORATION (the "CO-SYNDICATION AGENTS"), as Co-Syndication Agents; and
CREDIT SUISSE FIRST BOSTON, as Arranger (the "ARRANGER").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, on March 27, 1998 (the "ORIGINAL DOCUMENTATION DATE") Lessee,
Lessor, the Original Lenders, Administrative Agent, Documentation Agent
thereunder, Syndication Agent thereunder and Arranger entered into a
Participation Agreement (as heretofore amended, the "ORIGINAL PARTICIPATION
AGREEMENT") and the other Original Operative Documents to finance the purchase
of that certain unimproved land located in Canton, Massachusetts, more
particularly described in Exhibit A attached to the Original Lease (the
"ORIGINAL LAND") and the construction of a facility thereon (the buildings,
structures and improvements excluding the Original Land, the "ORIGINAL
FACILITY");
WHEREAS, Lessee, as Construction Agent, was engaged by Lessor pursuant to
the Original Operative Documents to design, engineer, procure, upgrade,
transport, install and construct the Original Facility on the Original Land, and
Construction Agent completed construction of the Original Facility as required
therein;
WHEREAS, pursuant to the Original Lease and the other Original Operative
Documents, Lessor leased the Original Property to Lessee;
WHEREAS, Lessor has invested as equity a certain portion of the cost of the
Original Land and the construction of the Original Facility;
WHEREAS, Lessor obtained from the Original Lenders financing (the "ORIGINAL
FINANCING") for a portion of the costs of acquisition of the Original Land and
the construction of the Original Facility thereon;
WHEREAS, to secure the Original Financing, Lessor provided the Original
Mortgage on the Original Property, an Assignment of Lease Agreement, and an
Assignment of Construction Agreement to the Lenders;
WHEREAS, Lessee desires to extend the term of the Original Lease and
Original Financing for a period of five (5) years beyond the Base Term
Expiration Date under the Original Lease and have Lessor obtain financing for
the purchase of an additional parcel of land (the "ADDITIONAL LAND") and
existing improvements thereon located contiguous to the Original
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Participation Agreement
Property (the "ADDITIONAL IMPROVEMENTS"; collectively, the "ADDITIONAL FACILITY"
or "ADDITIONAL PROPERTY") and to lease such Additional Property from Lessor
under the Lease;
WHEREAS, the Participants are willing to extend such financing and provide
for the acquisition, financing and lease of the Additional Property, all on the
terms and subject to the conditions of this Agreement and the other Operative
Documents;
WHEREAS, upon such acquisition, subject to the terms and conditions of the
Lease, this Agreement and the other Operative Documents, the Additional Property
will become subject to the Lease and the other Operative Documents;
WHEREAS, on the Documentation Date, the parties hereto desire to enter into
this Participation Agreement and certain other Operative Documents for the
purpose of amending and restating the Original Participation Agreement and
certain Original Operative Documents in their entirety, including to add New
Participants, to provide for the extension of the Original Lease and Original
Financing and to provide for the acquisition, financing, and lease of the
Additional Property; and
WHEREAS, on the Documentation Date, subject to the terms and conditions
hereof, (i) Lessor shall increase its investment in the Lease Balance by
prepaying a portion of the principal amount of the outstanding Original Notes
equal to $3,000,000 in the aggregate (the "DOCUMENTATION DATE PREPAYMENT
AMOUNT") and (ii) the New Lenders and one Original Lender shall purchase from
certain of the Original Lenders a portion of the Original Notes and related
Commitments of such Participants funding the Advances outstanding on such date;
NOW, THEREFORE, in consideration of the mutual agreements herein contained
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 DEFINITIONS. Unless the context shall otherwise require, capitalized
terms used and not defined herein shall have the meanings assigned thereto in
APPENDIX 1 hereto for all purposes hereof. From and after the Documentation
Date, all references in the Operative Documents to (a) the "Participation
Agreement" shall be deemed to refer to this Amended and Restated Participation
Agreement, (b) the "Lease" shall be deemed to refer to the Amended and Restated
Lease, (c) the "Guaranty" shall be deemed to refer to the Amended and Restated
Guaranty, (d) the "Mortgage" shall be deemed to refer to the Amended and
Restated Mortgage, Assignment of Rents and Leases, Security Agreement and
Fixture Filing Statement, (e) the "Loan Agreement" shall be deemed to refer to
the Amended and Restated Loan Agreement, (f) the "Assignment of Lease" shall be
deemed to refer to the Amended and Restated Assignment of Lease, (g) the
"Environmental Indemnity Agreement" shall be deemed to refer to the Amended and
Restated Environmental Indemnity Agreement, and all other Operative Documents
not otherwise amended and restated on the date hereof shall continue in full
force and effect in accordance with the provisions thereof and are hereby
ratified and confirmed in all respects.
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Participation Agreement
ARTICLE II
EFFECTIVENESS; ACQUISITION AND LEASE; GENERAL PROVISIONS
2.1 EFFECTIVENESS OF AGREEMENT.
(a) EFFECTIVENESS. This Agreement shall become effective on the
date (on or before March 19, 2004) on which all the conditions precedent thereto
set forth in SECTION 3.1 hereto shall have been satisfied or waived by the
applicable parties as set forth therein (the "DOCUMENTATION DATE").
(b) OBLIGATIONS NOT AFFECTED. Upon the Documentation Date, this
Agreement shall amend and completely restate and supersede the Original
Participation Agreement. Notwithstanding the amendment and restatement of the
Original Participation Agreement by this Participation Agreement, (i) Lessee
shall continue to be liable to Lessor, Administrative Agent and the Original
Participants with respect to agreements on the part of Lessee under the Original
Participation Agreement to indemnify and hold the Lessor, Administrative Agent
and the Original Participants harmless pursuant to the Original Participation
Agreement for matters within the scope of such indemnification provisions that
arose during the period that such agreement was in effect, and (ii) the
indebtedness, liabilities and obligations owing to Lessor, Administrative Agent
and the Original Participants by the Lessee and the Lessor under the Original
Participation Agreement and the other Original Operative Documents remain
outstanding as of the date hereof, constitute continuing Advances hereunder and
shall continue to be secured by the collateral described in and pursuant to the
Lease and the other Loan Documents but are payable in accordance with the terms
of this Participation Agreement and the other Operative Documents. This
Participation Agreement is given in substitution for, and as a continuation and
extension of, the Original Participation Agreement and does not evidence a
repayment and reborrowing of the obligations of Lessee or Lessor under such
agreement, and is in no way intended to constitute a novation of the Original
Participation Agreement or the other Original Operative Documents and the Liens
granted with respect thereto in the Original Operative Documents shall be
continuing.
2.2 AGREEMENT TO ACQUIRE AND LEASE. On the Documentation Date, Lessor and
Lessee shall enter into, among other Operative Documents, the Lease pursuant to
which Lessor shall agree to continue to lease the Original Property to Lessee
and to lease the Additional Property to Lessee upon its acquisition. On the
Documentation Date and conditioned upon receipt by the applicable Original
Lenders in immediately available funds of the amounts set forth in SCHEDULE II
hereto, (i) the applicable Original Lenders shall automatically, without further
action, be deemed to have transferred all or a portion of the Original Notes
held by such Original Lenders to the New Lenders or the Lenders in accordance
with the respective amounts and in the respective percentages set forth in
SCHEDULE II hereto, and each New Lender or Lender agrees to acquire its
respective amount and percentage set forth in SCHEDULE II hereto together with a
respective amount and percentage of the obligations of the Original Lenders
under the Original Operative Documents, and (ii) the Outstanding Loan Balance
shall, to the extent provided in SECTION 2.3(a) of this Agreement,
automatically, without further action, be deemed transferred and reallocated
between Tranche A Loans and Tranche B Loans, respectively. Subject to the terms
and conditions herein set forth, Lessor shall acquire the Additional Property on
the Acquisition Date and make Advances on each Advance Date for the purpose of
(x) funding the
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purchase of the Additional Property, (y) funding Commitment Fees and (z) funding
Transaction Costs.
2.3 PARTICIPATION BY LENDERS AND LESSOR.
(a) Subject to the terms and conditions hereof, on the
Documentation Date (i) Lessor shall make an investment in the Lease Balance
outstanding on the Closing Date by prepaying a portion of the Outstanding Loan
Balance equal to the Documentation Date Prepayment Amount; such amount shall be
treated as an increase in the Invested Amount and a decrease in the Outstanding
Loan Balance, but the Outstanding Funded Amount shall not change; (ii) Lessor
shall maintain its Outstanding Investor Balance under the Original Participation
Agreement as Invested Amounts under this Agreement, together with the
Documentation Date Prepayment Amount, in the amount set forth on SCHEDULES I and
II after giving effect to the increase in its investment in the amount of the
Documentation Date Prepayment Amount; (iii) each New Lender and applicable
Lenders shall purchase its respective portion of the Original Notes from the
applicable Original Lenders as is set forth on SCHEDULE II hereto, by
transferring immediately available funds therefor to the account of
Administrative Agent, for the account of the applicable Original Lender, as is
set forth on SCHEDULE II; (iv) each Lender shall maintain the Loans outstanding
to Lessor under the Original Loan Agreement as Loans under the Loan Agreement in
the respective amounts set forth on SCHEDULE II after giving effect to such
prepayment and purchase and to a reallocation between the Tranche A Loans and
Tranche B Loans made in connection with such prepayment and purchase. Lessor
shall make such prepayment of the Outstanding Loan Balance by transferring
immediately available funds therefor to Administrative Agent, for the account of
each Original Lender set forth on SCHEDULE II. The Administrative Agent shall
distribute (i) the prepayment of the Outstanding Loan Balance to the Original
Lenders pro rata in accordance with the respective balances of the Original
Notes held by each Original Lender; and (ii) all other amounts received from the
Lenders on the Documentation Date to the applicable Original Lenders as set
forth on SCHEDULE II. On the Documentation Date each Lender shall exchange its
Original Notes for Notes in amounts representing its Commitment to make and
maintain Tranche A Loans and Tranche B Loans after giving effect to the
prepayment, purchases and reallocation of Tranche A Loans and Tranche B Loans
reflected on SCHEDULE II.
(b) 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 Advance Date each Lender shall
finance, in part, each Advance by Lessor (or portion thereof) by making a Loan
to Lessor on such Advance Date in an amount equal to such Lender's Commitment
Percentage of such Advance (or portion thereof), in each case in the aggregate
not more than its Commitment as set forth on SCHEDULE II hereto. Each Loan shall
be evidenced by a Note issued to a Lender under and repayable in accordance with
the terms of the Loan Agreement (which shall be substantially in the form of
EXHIBIT A thereto). All Loans made by each Lender in accordance with this
SECTION 2.3(a) shall be made to Lessor in accordance with Lessor's payment
instructions set forth in SCHEDULE III in immediately available funds no later
than 12:00 (noon), New York City time, on the requested Advance Date.
(c) 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
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pursuant hereto, on each Advance Date Lessor shall fund the Invested Amount of
the Advance being made on such Advance Date in the amount of the Lessor's
Commitment Percentage of such Advance. Such fundings shall not exceed the amount
of the Lessor's Commitment as set forth on SCHEDULE I. Lessor shall be entitled
to receive Yield on its aggregate Invested Amount payable as Basic Rent on each
Payment Date.
2.4 ADVANCE DATES.
(a) NOTICES. If any part of an Advance is to be funded with
Eurodollar Loans, not later than 12:00 (noon), New York City time, three (3)
Business Days prior to such Advance Date, or, in the case of ABR Loans not later
than 11:00 a.m., New York City time, one (1) Business Day prior to such Advance
Date, the Lessee shall deliver to Administrative Agent an irrevocable written
notice substantially in the form of EXHIBIT B (an "ADVANCE REQUEST"), setting
forth:
(i) the proposed Advance Date;
(ii) in the case of an Advance to fund the acquisition cost
for the Additional Property, the amount thereof, the scheduled
Acquisition Date, a copy of the draft of the title insurance and such
other information, including without limitation, the items set forth
in SECTION 3.3, as Lessor may reasonably request;
(iii) in the case of an Advance to fund any Transaction Costs,
a description of such Transaction Costs;
(iv) wire transfer instructions for the disbursement of funds;
and
(v) if the Loans comprising such Advance are to be entirely
or partly Eurodollar Loans, the length of the Interest Period for
such Eurodollar Loans.
Any Advance may be used for more than one of the costs described in CLAUSES
(ii) and (iii) above.
Except for any Advance to fund Transaction Costs or the Commitment Fee, any
Advance of Eurodollar Loans shall be in such amounts and be made pursuant to
such elections so that, after giving effect thereto, (i) the aggregate principal
amount of all Eurodollar Loans having the same Interest Period shall not be less
than $5,000,000 or a whole multiple of $1,000,000 in excess thereof and (ii) no
more than 6 Interest Periods shall be in effect at any one time.
All documents and instruments required to be delivered on the Documentation
Date and the Acquisition Date pursuant to this Agreement shall be delivered at
the offices of McGuireWoods LLP, 77 West Wacker Drive, Chicago, Illinois 60601.
All documents and instruments required to be delivered on any other Advance Date
pursuant to this Agreement shall be delivered at the offices of the
Administrative Agent at 1 Madison Avenue, 2nd Floor, New York, New York 10010,
or as otherwise instructed. On the scheduled Advance Date, and subject to the
terms and conditions of this Agreement, and upon receipt of funds by Lessor from
the Lenders sufficient therefor, Lessor shall make the requested Advance.
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(b) COMMITMENT LIMITS. The sum of the aggregate amount disbursed by
the Lessor and the Lenders hereunder, including the Outstanding Funded Amount
under the Original Financing, shall not exceed the aggregate Commitments. The
sum of the amounts disbursed by the Lessor and Lenders hereunder in connection
with the acquisition of the Additional Property and the payment of Transaction
Costs related thereto or arising out of the preparation, negotiation, execution
and filing or recording of the Operative Documents and related fees and expenses
shall not exceed the Additional Property Commitment Amount.
(c) NUMBER AND AMOUNT OF ADVANCES. Except for any Advance to fund
Transaction Costs or the Commitment Fee, each Advance shall be in a minimum
amount of $5,000,000 or if the remaining amounts of the Commitments are less
than $5,000,000, such lesser amount.
(d) OBLIGATIONS SEVERAL. The obligations of the parties hereto or
elsewhere in the Operative Documents shall be several and not joint; and no
Participant shall be liable or responsible for the acts or defaults of any other
Participant hereunder or under any other Operative Document; provided that the
foregoing shall not limit or otherwise restrict any liability of the general
partner or the Lessor for any obligation hereunder of the Lessor.
(e) TERMINATION OF COMMITMENT. Notwithstanding anything in this
Agreement to the contrary, no party hereto shall be obligated to make any
fundings pursuant to this Agreement after 2:00 P.M., New York time, on the
Commitment Period Termination Date, and no Advance Date may occur following such
date.
(f) ACCOUNTS, NOTES AND CERTIFICATES; NOTATIONS. The Administrative
Agent shall maintain at its address referred to in SECTION 8.3 a copy of each
Investor's Letter delivered to it, a register for the recordation of the names
and addresses of the Participants and the Commitment of each Participant from
time to time, and a subaccount therein for each Participant in which shall be
recorded the information described in the last sentence of this SECTION 2.4 (f).
Upon the consummation of each Advance, the Administrative Agent shall make a
notation in its subaccount indicating the amount advanced by each Participant.
The Administrative Agent is hereby authorized to record the date and amount of
each Advance made by each Participant, each continuation thereof, the date and
amount of each payment or repayment of principal and the length of each Interest
Period with respect thereto in the Administrative Agent's subaccount, 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 obligation of Lessor under
such instrument or the corresponding obligation of Lessee to pay Rent.
(g) TRANSACTION COSTS ADVANCES AND COMMITMENT FEE ADVANCES.
Advances for Transaction Costs shall be disbursed directly by the Administrative
Agent in the amounts and to the Persons described in the Advance Request.
2.5 COMMITMENT FEE; ADMINISTRATION FEE. Lessee shall pay to
Administrative Agent a fully-earned, non-refundable commitment fee (the
"COMMITMENT FEE") computed at the rate per annum set forth on APPENDIX 3 on the
daily unused portion of the aggregate Commitments (including any portion thereof
when any Commitments are suspended by reason of the inability
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to satisfy any condition of ARTICLE III) during the period (the "COMMITMENT
PERIOD") commencing on the Documentation Date and continuing through the
Commitment Period Termination Date. The Commitment Fee is payable quarterly in
arrears on the last Business Day of each consecutive March, June, September and
December, commencing with the first such day following the Documentation Date
and on the Commitment Period Termination Date. From time to time upon receipt,
Administrative Agent will promptly deliver to the Lenders and Lessor their PRO
RATA portions of such Commitment Fee in accordance with their respective
Commitments. Lessee shall pay to Administrative Agent the Administration Fee for
its own account. The Administration Fee is payable on the Documentation Date and
each anniversary thereof and is fully-earned and non-refundable.
2.6 PAYMENTS TO PARTICIPANTS. The parties to this Agreement hereby agree
that any payment (except Excluded Amounts) required to be made to the
Participants pursuant to any Operative Document may be made directly to
Administrative Agent on behalf of the Participants by Lessee in lieu of the
corresponding payment required to be made by Lessee to Lessor pursuant to any
Operative Document. Such payment by Lessee to Administrative Agent shall be
deemed to constitute (a) the required payment from Lessee to Lessor and (b) the
corresponding payments by Lessor to the Lenders. Lenders hereby agree that all
payments under the Lease shall be distributed in accordance with Article III of
the Loan Agreement.
2.7 COMPUTATIONS. (a) For all purposes under the Operative Documents, all
computations of Interest and Yield in respect of ABR Loans and the Investor
Balance (when Yield is calculated in respect of the ABR), Commitment Fees and
other accrued amounts shall be made on the basis of actual number of days
elapsed in a 365- (or 366- as the case may be) day year, and Interest and Yield
in respect of Eurodollar Loans and the Investor Balance (when Yield is
calculated in respect of the Eurodollar Rate) shall be made on the basis of the
actual number of days elapsed in a 360-day year, except as otherwise
specifically provided in any Operative Document. Administrative Agent shall as
soon as practicable notify the Lessee 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 Eurocurrency Reserve Requirements and any change in the Applicable
Margin resulting from a change in the credit rating of the Company shall become
effective as of the opening of business on the first day of the Interest Period
immediately following such change. Administrative Agent shall as soon as
practicable notify the Lessee and the Lenders of the effective date and the
amount of each such change in interest rate. Any change in the interest rate on
a Loan resulting from a change in the ABR and any change in the Commitment Fee
rate resulting from a change in the credit rating of the Company shall become
effective on the earlier of (x) the date upon which such change is publicly
announced by the relevant rating agency and (y) the date upon which the Company
provides to the Administrative Agent reasonably satisfactory evidence of such
change.
(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on the Lessee and the Lenders in the absence of manifest error.
Administrative Agent shall, at the request of the Lessee, deliver to Lessee a
statement showing the quotations used by the Administrative Agent in determining
any interest rate.
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2.8 RENEWAL TERM. (a) Coincident with the exercise by the Lessee of its
option during the Base Term or a Renewal Term then in effect to renew the Lease
for a new Renewal Term pursuant to Section 2.4 of the Lease: (i) Lessee may, at
Lessee's expense and by written request to the Lessor and the Administrative
Agent not earlier than nine (9) months nor later than six (6) months prior to
the Maturity Date then in effect, arrange or request Administrative Agent to
solicit bids from Participants to permit Lessee to extend the Operative
Documents for another Renewal Term, and concomitantly to extend the Final
Maturity Date to the new Renewal Term Expiration Date, which shall be the date
that is two years after the Maturity Date then in effect; Lessee may, in its
sole discretion, accept or reject any and all offers from one or more
Participants and in its sole discretion, Lessee may elect, with the consent of
the Administrative Agent, which consent shall not be unreasonably withheld, to
replace (in accordance with SECTION 2.8(b)) any Participant that does not submit
an offer to extend or whose offer is not acceptable to Lessee (in each case, a
"NON-CONSENTING PARTICIPANT"); and (ii) on or before the expiration of the Base
Term or the Renewal Term then in effect, Lessee, Administrative Agent, Lessor
and continuing or new Lenders shall enter into appropriate documentation
(including an amendment to this Agreement and the Loan Agreement to reflect the
agreed-upon economic terms) to effect such renewal of the Lease and the other
Operative Documents for such Renewal Term, and concomitantly to extend the Final
Maturity Date to the new Renewal Term Expiration Date. Such renewal of the Lease
and concomitant extension of the Final Maturity Date shall be effective for such
Participants approving the extension if the Required Entities agree to and
approve such extension. None of the Lenders or the Lessor is in any way
obligated to bid or offer to participate under the option to renew the Lease or
to otherwise remain subject to the Operative Documents after the expiration of
the Base Term or after expiration of any Renewal Term.
(b) Lessee may cause Lessor to replace any Non-Consenting
Participant in accordance with SECTION 2.8(a) by notifying such Non-Consenting
Participant in writing that its offer is not accepted, or if no such offer was
received within forty-five (45) days of request or solicitation of such offer,
by notifying such Non-Consenting Participant that due to its failure to respond,
such Non-Consenting Participant is being replaced. All replacement Lenders will
be required to enter into the Operative Documents in the same manner as all
existing Lenders. Any Non-Consenting Participant as a condition to being
replaced will receive payment in full of all amounts owing to such
Non-Consenting Participant under the Operative Documents including, as
applicable, principal, Interest, Yield, and all other amounts outstanding under
the Operative Documents in respect of such Non-Consenting Participant and its
Commitment Percentage. Section 2.8 of the Loan Agreement shall not apply to
payments received by any Lender under this SECTION 2.8(b).
2.9 HIGHEST LAWFUL RATE. Notwithstanding anything to the contrary
contained herein, in no event shall Lessee be obligated to pay interest in
excess of the maximum amount which is chargeable under applicable law.
2.10 CONVERSION OPTIONS. Lessee may elect from time to time to convert
Eurodollar Loans into ABR Loans by giving the Administrative Agent irrevocable
notice of such election, to be received by the Administrative Agent prior to
12:00 noon, New York City time, at least three (3) Business Days prior to the
proposed conversion date, PROVIDED that any such conversion of Eurodollar Loans
shall only be made on the last day of an Interest Period with respect thereto.
Lessee may elect from time to time to convert all or a portion of the ABR Loans
then outstanding
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to Eurodollar Loans by giving the Administrative Agent irrevocable notice of
such election, to be received by the Administrative Agent prior to 12:00 noon,
New York City time, at least three (3) Business Days prior to the proposed
conversion date, specifying the Interest Period selected therefor, and, if no
Default or Event of Default has occurred and is continuing such conversion shall
be made on the requested conversion date or, if such requested conversion date
is not a Business Day, on the next succeeding Business Day. Upon receipt of any
notice pursuant to this SECTION 2.10, the Administrative Agent shall promptly
notify each Lender thereof. All or any part of the outstanding Loans may be
converted as provided herein, PROVIDED that partial conversions of ABR Loans
shall be in the aggregate principal amount of $5,000,000 or a whole multiple of
$1,000,000 in excess thereof and the aggregate principal amount of the resulting
Eurodollar Loans outstanding in respect of any one Interest Period shall be at
least $5,000,000 or a whole multiple of $1,000,000 in excess thereof.
2.11 REPLACEMENT OF LENDERS. In the event any Lender requests payments
pursuant to SECTION 2.8(b) or Sections 2.11 or 2.12 of the Loan Agreement (which
costs Lessee is obligated to pay as Supplemental Rent under Section 4.2 of the
Lease), the Lessee may require, at the Lessee's expense and subject to Section
2.13 of the Loan Agreement, such Lender to assign, at par plus accrued interest
and fees, without recourse to such Lender, in accordance with SECTION 6.3, all
of its interests, rights and obligations under the Operative Documents
(including all of its Commitments and the Loans and other amounts at the time
owing to it thereunder and its Notes) to a Person who would qualify under
SECTION 6.4(a) specified by the Lessee; PROVIDED that (i) such assignment shall
not conflict with or violate any Applicable Law, (ii) the Lessee shall have
received the written consent of the Administrative Agent, which consent shall
not unreasonably be withheld, to such assignment and (iii) the Lessee shall have
paid to the assigning Lender all Supplemental Rent accrued and owing under the
Operative Documents to it (including pursuant to Sections 2.11 or 2.12 of the
Loan Agreement).
ARTICLE III
CONDITIONS TO DOCUMENTATION DATE AND ADVANCES
3.1 CONDITIONS PRECEDENT TO DOCUMENTATION DATE. The obligation of each
Participant to perform its obligations on the Documentation Date shall be
subject to the fulfillment to the satisfaction of (including, with respect to
writings, such writings being in form and substance reasonably satisfactory to
Administrative Agent or, where expressly provided below, the Required Entities
or each Participant), or the waiver in writing by, Administrative Agent (at the
direction of the Required Entities) or each Participant of the conditions
precedent set forth in this SECTION 3.1 on or prior to the Documentation Date
(except that the obligation of any party hereto shall not be subject to such
party's own performance or compliance):
(a) AUTHORIZATION EXECUTION AND DELIVERY OF DOCUMENTS; NO LEASE
DEFAULT. The Participation Agreement, the Lease, Lease Supplement No. 1, the
Guaranty, the Loan Agreement, the Notes, the Mortgage, the Environmental
Indemnity, the Assignment of Lease and a Supplement to Assignment of Lease shall
have been duly authorized, executed and delivered by each of the other parties
thereto, shall (to the extent the form and substance thereof shall not be
prescribed hereby) be in form and substance satisfactory to such Participant and
an executed counterpart of each thereof shall have been delivered to Lessor, the
Lenders and Administrative Agent. Each Lender shall have received original, duly
executed Notes registered in such
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Lender's name in exchange for such Lender's Original Notes. Each of the
Participation Agreement, the Lease, Lease Supplement No. 1, the Guaranty, the
Loan Agreement, the Notes, the Mortgage, the Environmental Indemnity, the
Assignment of Lease and the Supplement to Assignment of Lease shall be in full
force and effect as to all other parties and no Default or Event of Default
shall have occurred or be continuing.
(b) LITIGATION. No action or proceeding shall have been instituted
or threatened nor shall any governmental action be instituted or threatened
before any Authority, nor shall any order, judgment or decree have been issued
or proposed to be issued by any Authority, to set aside, restrain, enjoin or
prevent the performance of this Agreement or any transaction contemplated hereby
or by any other Operative Document or which is reasonably likely, in the sole
opinion of the Administrative Agent, to have a Material Adverse Effect.
(c) LEGALITY, ETC. In the opinion of the Administrative Agent or
its counsel, the transactions contemplated by the Operative Documents do not and
will not violate any Applicable Law and do not and will not subject Lessor,
Administrative Agent or any Lender to any adverse regulatory prohibitions or
constraints and no change shall have occurred or been proposed in Applicable Law
that would make it uneconomic or illegal for any party to any Operative Document
to participate in any of the transactions contemplated by the Operative
Documents or otherwise would prohibit the consummation of any transaction
contemplated by the Operative Documents or expand the duties, obligations and
risks of such party under the Operative Documents.
(d) GOVERNMENTAL APPROVALS. All necessary Government Actions, in
each case required by any Applicable Law, shall have been obtained or made and
be in full force and effect.
(e) OPINIONS. The following opinions, each dated the Documentation
Date, substantially in the form set forth in the Exhibit noted below, and
containing such other matters as the parties to whom they are addressed shall
reasonably request, shall have been delivered and addressed to Lessor, the
Administrative Agent and the Lenders:
(i) the opinion of Ropes & Gray LLP, special counsel for
Lessee (EXHIBIT G-1); and
(ii) the opinion of David A. Pace, general counsel for Lessee
(EXHIBIT G-2).
(f) CORPORATE STATUS AND PROCEEDINGS. On or prior to the
Documentation Date, each of the Participants, Lessor and Administrative Agent
shall have received:
(i) certificates of existence and good standing with respect
to Lessee from (A) the Secretary of State of the state of its organization
and (B) the Secretary of State of the state of its chief executive office,
each dated no earlier than the 15th day prior to the Documentation Date;
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(ii) copies of Lessee's articles of organization, certified
by the Secretary of State of the state of its organization, no earlier than
the 15th day prior to the Documentation Date; and
(iii) with respect to Lessee, an Officer's Certificate
substantially in the form of EXHIBIT H, dated the Documentation Date, with
respect to such Person's governing documents, resolutions and incumbent
officers, representations and warranties and absence of defaults.
(g) FEES. Lessee shall have paid the Administration Fee and the
Arrangement Fee to Credit Suisse First Boston.
(h) INSURANCE. Lessee shall have delivered the certificates with
respect to the Original Property described in Section 11.2 of the Lease.
(i) FILINGS AND RECORDINGS. All filings or recordings enumerated
and described in SCHEDULE 4.1A hereof, as well as all other filings and
recordings necessary or advisable, including precautionary financing statements
and updates or amendments to filings done in connection with the Original
Participation Agreement and Original Operative Documents, in the opinion of
Administrative Agent or counsel to the Participants, to perfect and maintain the
perfection of the rights, titles and interests of the Participants intended to
be created by the Operative Documents shall have been made, or shall have been
arranged to be made promptly thereafter, in the appropriate places or offices,
including any recordings and filings necessary to create, perfect, preserve and
protect (i) Lessor's interest in the Original Property, (ii) a first mortgage
lien on the Original Property included in the Collateral in favor of the
Administrative Agent, for the benefit of the Lenders, subject in both cases, to
Permitted Exceptions and the rights of Lessee under the Lease. All recording and
filing fees and taxes with respect to any recordings or filings made pursuant to
this SECTION 3.1(i) shall have been paid in full, and satisfactory evidence
thereof shall have been delivered to Administrative Agent, or arrangements for
such payment shall have been made to the satisfaction of Administrative Agent.
(j) SURVEY. Lessee shall have delivered, or shall have caused to be
delivered, to Administrative Agent and its counsel a current ALTA survey of the
Original Property in a form satisfactory to the Title Insurance Company and
showing no state of facts unsatisfactory to Administrative Agent and counsel to
the Participants, which survey shall be certified to Lessor and Administrative
Agent and including such requirements as may be reasonably requested by Lessor
and/or Administrative Agent, as the case may be.
(k) TITLE INSURANCE. Lessor shall have received from the Title
Insurance Company an ALTA (1970 or 1992 version owner's policy of title
insurance acceptable in form and substance to Administrative Agent (the
"ORIGINAL PROPERTY LESSOR'S POLICY") (or a final hand-marked original thereof
signed by the Title Insurance Company containing all of the provisions to be
included in such policy by the Title Insurance Company, in which case Lessor
shall receive a clean, final original of such Policy within thirty (30) Business
Days), insuring that Lessor has good and marketable fee title to the Original
Property subject to Permitted Exceptions, together with complete, legible copies
of all encumbrances, maps and surveys of record. Administrative Agent, for the
benefit of the Lenders, shall have received from the Title
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Insurance Company an ALTA (1970 or 1992 version loan policy of title insurance
(the "ORIGINAL PROPERTY LOAN POLICY"; together with the Original Property
Lessor's Policy, the "ORIGINAL PROPERTY TITLE POLICIES"), reasonably acceptable
in form and substance to Administrative Agent and the counsel for the Lenders,
insuring the continuation under the Mortgage in favor of Administrative Agent on
behalf of Lenders and the Lease in favor of Lessor of a valid first priority
mortgage lien against the Original Property, subject to Permitted Exceptions,
together with complete, legible copies of all encumbrances, maps and surveys of
record. The Original Property Title Policies shall be dated as of the
Documentation Date, shall be in an amount not less than the Outstanding Funded
Amount and, to the extent permitted under Applicable Law and to the extent
available and applicable to each type of policy, shall contain such additional
endorsements and affirmative coverage reasonably requested by Lessor and/or
Administrative Agent, as the case may be.
(l) ENVIRONMENTAL CERTIFICATE AND AUDIT. Administrative Agent and
Lessor shall have each received an Environmental Certificate, substantially in
the form of EXHIBIT F (an "ENVIRONMENTAL CERTIFICATE") with respect to the
Original Property, and an update to the Environmental Audit prepared by the
Environmental Engineer for such Property shall have been delivered to and
approved by Administrative Agent and the Required Entities in their sole and
absolute discretion. Administrative Agent and the Participants will timely
advise Lessee if such Environmental Audit is not approved; PROVIDED that failure
to so advise Lessee on or before one Business Day prior to the Documentation
Date shall be deemed approval of such Environmental Audit.
(m) ZONING. In the event that an ALTA 3.1 Zoning Endorsement (with
express parking coverage) is not obtained in connection with the Original
Property Title Policies for the Original Land, Administrative Agent shall
receive evidence reasonably satisfactory to it that the zoning of the Original
Land is satisfactory and compatible with the Original Facility constructed
thereon.
(n) MORTGAGE. Administrative Agent shall have received a Mortgage
duly executed by Lessor and Lessee with respect to the Original Property
maintaining the first lien on the Original Property created under the Original
Mortgage in favor of the Administrative Agent for the benefit of the Lenders.
(o) FILINGS AND RECORDATIONS. Administrative Agent shall have
received evidence reasonably satisfactory to it that each of the Mortgage, the
Assignment of Lease and the Supplement to Assignment of Lease delivered on the
Documentation Date shall have been or are being recorded with the appropriate
Authorities in the order in which such documents are listed in this clause, and
the UCC financing statements or amendments to existing UCC financing statements
with respect to the Original Facility shall have been or are being filed with
the appropriate Authorities.
(p) APPRAISAL. Not less than five (5) Business Days prior to the
Documentation Date, Administrative Agent shall have received and will deliver to
Lessor and each Lender an appraisal (the "ORIGINAL PROPERTY APPRAISAL") which
will establish (by the use of appraisal methods set forth in the Appraiser
Engagement Letter) (i) as of the Documentation Date the as-built Fair Market
Sales Value of the Original Property in an amount not less than
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$150,000,000 and (ii) the Fair Market Sales Value of such Property as of the end
of the Base Term in an amount not less than $150,000,000. The opinions to be
rendered in connection with the Appraisals to be delivered pursuant to this
SECTION 3.1(p) shall be based upon the assumptions set forth in the Appraiser
Engagement Letter. The Appraisal will be prepared in accordance with the
Financial Institutions Reform Recovery and Enforcement Act of 1989 and will be
performed by the Appraiser.
(q) NO EVENT OF LOSS. No Casualty (where Lessee reasonably expects
repair and restoration costs resulting from such casualty to exceed $10,000,000
with respect to the Original Property) (other than a Casualty which has been
taken into consideration in the Original Property Appraisal) shall have
occurred. No action shall be pending or threatened by an Authority to initiate a
Condemnation or an Event of Taking in respect of the Original Property.
(r) TRANSACTION COSTS. Lessee shall have paid or caused to be paid
all Transaction Costs invoiced through the Documentation Date to the parties to
whom such Transaction Costs are payable (or shall have requested payment
thereof). Payments shall be made by wire transfer of immediately available
funds, with such wire transfer being made to the accounts specified on SCHEDULE
III in the case of payments to any of the parties listed on SCHEDULE III.
3.2 CONDITIONS TO ALL ADVANCES. The obligation of Lessor and each Lender
to perform its obligations on any Advance Date shall be subject to the
fulfillment to the satisfaction of (including, with respect to writings, such
writings being in form and substance reasonably satisfactory to Lessor and
Administrative Agent or, where expressly provided below, the Required Entities),
or the waiver in writing by, Lessor and Administrative Agent (at the direction
of Required Entities) of the conditions precedent set forth in this SECTION 3.2
(in addition to the conditions precedent set forth in SECTION 3.1 or 3.3, as
applicable) on or prior to such Advance Date (except that the obligation of any
party hereto shall not be subject to such party's own performance or
compliance):
(a) ADVANCE REQUEST. Lessee shall have delivered an Advance Request
conforming with the requirements of SECTION 2.4 in respect of the proposed
Advance Date.
(b) PERFORMANCE. Lessee shall have performed and complied with all
agreements and conditions contained herein and in any other Operative Document
to which it is a party required to be performed or complied with by it on or
prior to such Advance Date.
(c) CONSENTS AND APPROVALS. All Government Actions and other
approvals and consents required to be taken, given or obtained, as the case may
be, by or from any Authority or another Person, or by or from any trustee or
holder of any Indebtedness or obligation of Lessee, that are necessary in
connection with the execution, delivery and performance of the Operative
Documents by Lessee, shall have been taken, given or obtained, as the case may
be, shall be in full force and effect and the time for appeal with respect to
any thereof shall have expired (or, if an appeal shall have been taken, the same
shall have been dismissed) and shall not be subject to any pending proceedings
or appeals (administrative, judicial or otherwise).
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(d) REPRESENTATIONS AND WARRANTIES TRUE. Each representation and
warranty of Lessee contained herein or in any other Operative Document shall be
true and correct in all material respects as though made on and as of such
Advance Date, except that any such representation or warranty which is expressly
made only as of a specified date need be true only as of such date. Since
December 31, 2003, there has been no development or event which has had or could
reasonably be expected to have a Material Adverse Effect.
(e) TRANSACTION COSTS. With respect to the initial Advance Date,
Lessee shall have paid or caused to be paid all Transaction Costs invoiced
through the initial Advance Date to the parties to whom such Transaction Costs
are payable (or shall have requested payment thereof pursuant to the initial
Advance Request), and, with respect to any other Advance Date, Lessee shall have
paid all Transaction Costs invoiced through such Advance Date to the parties to
whom such Transaction Costs are payable (or shall have requested payment thereof
pursuant to the Advance Request). Payments shall be made by wire transfer of
immediately available funds, with such wire transfer being made to the account
specified on SCHEDULE III in the case of payments to any of the parties listed
on SCHEDULE III.
(f) PROCEEDINGS SATISFACTORY, ETC. All corporate proceedings taken
in connection with such Advance Date and all documents relating thereto shall be
reasonably satisfactory to Administrative Agent and counsel to the Participants,
and Administrative Agent and counsel to the Participants shall have received
copies of such documents as Administrative Agent or such counsel may reasonably
request in connection therewith.
(g) TAXES. All taxes, charges, fees and costs, if any, payable in
connection with the execution, delivery, recording and filing of the Operative
Documents and the transactions contemplated to be consummated on each Advance
Date shall have been paid in full, or arrangements for such payment shall have
been made to the satisfaction of Administrative Agent.
3.3 CONDITIONS TO ACQUISITION OF THE ADDITIONAL PROPERTY. The obligation
of each Participant to perform its obligations on the date on which the
Additional Property is to be acquired by Lessor (the "ACQUISITION DATE") shall
be subject to the fulfillment to the satisfaction of (including, with respect to
writings, such writings being in form and substance reasonably satisfactory to
Administrative Agent or, where expressly provided below, the Required Entities),
or the waiver in writing by, Administrative Agent (at the direction of the
Required Entities) of the conditions precedent set forth in this SECTION 3.3 (in
addition to the conditions precedent set forth in SECTION 3.2) on or prior to
such Advance Date (except that the obligation of any party hereto shall not be
subject to such party's own performance or compliance):
(a) FILINGS AND RECORDINGS. All filings or recordings enumerated
and described in SCHEDULE 4.1A hereof, as well as all other filings and
recordings necessary or advisable, including precautionary financing statements,
in the opinion of Administrative Agent or counsel to the Participants, to
perfect the rights, titles and interests of the Participants intended to be
created by the Operative Documents shall have been made, or shall have been
arranged to be made promptly thereafter, in the appropriate places or offices,
including any recordings and filings necessary to create, perfect, preserve and
protect (i) Lessor's interest in the Additional Property, (ii) a first mortgage
lien on the Additional Property included in the Collateral in favor
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of the Administrative Agent, for the benefit of the Lenders, subject in both
cases, to Permitted Exceptions and the rights of Lessee under the Lease. All
recording and filing fees and taxes with respect to any recordings or filings
made pursuant to this SECTION 3.3(a) shall have been paid in full, and
satisfactory evidence thereof shall have been delivered to Administrative Agent,
or arrangements for such payment shall have been made to the satisfaction of
Administrative Agent.
(b) OPINIONS OF COUNSEL. Administrative Agent has received an
opinion of counsel addressed to Administrative Agent, Lessor and the Lenders
substantially in the form of EXHIBIT G-1 with respect to the Operative Documents
executed and delivered in connection with such Advance Date and the perfection
and validity of the Participants' lien on the Additional Property being
purchased on such Advance Date, with such qualifications and limitations as are
acceptable to Administrative Agent and counsel to the Participants.
(c) SURVEY. Lessee shall have delivered, or shall have caused to be
delivered, to Administrative Agent and its counsel a current "as-built" ALTA
survey of the Additional Property, certified to Administrative Agent and Lessor
in a form satisfactory to the Title Insurance Company and showing no state of
facts unsatisfactory to Administrative Agent and counsel to the Participants,
which survey shall be certified to Lessor and Administrative Agent and including
such requirements as may be reasonably requested by Lessor and/or Administrative
Agent, as the case may be.
(d) TITLE INSURANCE. Lessor shall have received from the Title
Insurance Company a date-down endorsement to the Original Property Lessor's
Policy, acceptable in form and substance to Administrative Agent (the
"ADDITIONAL PROPERTY LESSOR'S POLICY") (or a final hand-marked original thereof
signed by the Title Insurance Company containing all of the provisions to be
included in such policy by the Title Insurance Company, in which case Lessor
shall receive a clean, final original of such Policy within thirty (30) Business
Days), insuring that Lessor has good and marketable fee title to the Original
Property and the Additional Property, together with complete, legible copies of
all encumbrances, maps and surveys of record. Administrative Agent, for the
benefit of the Lenders, shall have received from the Title Insurance Company a
date-down endorsement to the Original Property Loan Policy (the "ADDITIONAL
PROPERTY LOAN POLICY"; together with the Additional Property Lessor's Policy,
the "ADDITIONAL PROPERTY TITLE POLICIES"), reasonably acceptable in form and
substance to Administrative Agent and the counsel for the Lenders, insuring the
continuation or creation, as applicable, under the Mortgages in favor of
Administrative Agent on behalf of Lenders and the Lease in favor of Lessor of a
valid first priority mortgage lien against the Original Property and the
Additional Property, subject to Permitted Exceptions, together with complete,
legible copies of all encumbrances, maps and surveys of record. The Additional
Property Title Policies shall be dated as of the Acquisition Date, shall be in
an amount not less than the sum of the Outstanding Funded Amount and the
Additional Property Commitment Amount and, to the extent permitted under
Applicable Law and to the extent available and applicable to each type of
policy, shall contain such endorsements and affirmative coverage reasonably
requested by Lessor and/or Administrative Agent, as the case may be.
(e) ENVIRONMENTAL CERTIFICATE AND AUDIT. Administrative Agent and
Lessor shall have each received an Environmental Certificate with respect to the
Additional Property, and the Environmental Audit prepared by the Environmental
Engineer for the Additional
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Property shall have been delivered to and approved by Administrative Agent and
the Required Entities in their sole and absolute discretion. Administrative
Agent and the Participants will timely advise Lessee if such Environmental Audit
is not approved; PROVIDED that failure to so advise Lessee on or before one
Business Day prior to the Acquisition Date shall be deemed approval of such
Environmental Audit.
(f) ZONING. In the event that an ALTA 3.1 Zoning Endorsement (with
express parking coverage) is not obtained in connection with the Title Policies
for the Additional Property, Administrative Agent shall receive evidence
reasonably satisfactory to it that the zoning of the Additional Land is
satisfactory and compatible with the Additional Facility constructed thereon.
(g) PURCHASE AGREEMENT AND DEED. Administrative Agent shall have
received (i) a fully executed Purchase Agreement and Purchase Agreement
Assignment regarding the acquisition of the Additional Property, together with
(x) an Officer's Certificate of the Lessee to the effect that the Purchase
Agreement is complete and includes all existing amendments, modifications and
riders, and (y) a Purchase Agreement Assignment from Lessee to Lessor, (ii) a
Deed conveying to Lessor such Property, and (iii) a copy of the Additional
Property Sublease of such Property between the Seller, as lessee, and Lessee, as
lessor, which lease shall be reasonably acceptable in form and substance to
Administrative Agent and the counsel for the Lenders with a term of not more
than eighteen months, shall become a sublease to such Seller, and shall be
subordinate to the Lease and the Mortgage upon acquisition of such Property by
Lessor and the lease thereof to Lessee pursuant to the Lease.
(h) MORTGAGE. Administrative Agent shall have received a Mortgage
duly executed by Lessor and Lessee with respect to the Additional Property
creating a first lien on the Additional Property in favor of the Administrative
Agent for the benefit of the Lenders.
(i) LEASE SUPPLEMENT; ASSIGNMENT OF LEASE SUPPLEMENT.
Administrative Agent shall have received Lease Supplement No. 2 and such
Supplement to Assignment of Lease with respect to the Additional Property fully
executed by the Lessee and Lessor and Lessor and Administrative Agent,
respectively.
(j) FILINGS AND RECORDATIONS. Administrative Agent shall have
received evidence reasonably satisfactory to it that each of the Deed, Lease
Supplement No. 2, the Mortgage and the Supplement to Assignment of Lease
delivered on the Acquisition Date shall have been or are being recorded with the
appropriate Authorities in the order in which such documents are listed in this
clause, and the UCC Financing Statements with respect to the Additional Property
shall have been or are being filed with the appropriate Authorities.
(k) INSURANCE. Insurance complying with the provisions of
Article XI of the Lease shall be in full force and effect as evidenced by
certificates of insurance, broker's reports or insurance binders delivered to
Lessor in form and substance reasonably satisfactory to Administrative Agent.
(l) APPRAISAL. Not less than five (5) Business Days prior to the
Acquisition Date, Administrative Agent shall have received and will deliver to
Lessor and each Lender an
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appraisal (the "ADDITIONAL PROPERTY APPRAISAL") which will establish (by the use
of appraisal methods set forth in the Appraiser Engagement Letter) (i) as of the
date such Property becomes subject to the Lease, such Property's Fair Market
Sales Value, in an amount not less than $16,000,000 and (iii) the Fair Market
Sales Value of such Property as of the end of the Base Term in an amount not
less than $16,000,000. The opinions to be rendered in connection with the
Appraisals to be delivered pursuant to this SECTION 3.3(l) shall be based upon
the assumptions set forth in the Appraiser Engagement Letter. The Appraisal will
be prepared in accordance with the Financial Institutions Reform Recovery and
Enforcement Act of 1989 and will be performed by the Appraiser.
(m) FIRPTA AFFIDAVIT. Lessee shall have caused the seller or
assignor of the Additional Property to deliver to Administrative Agent either
(i) a FIRPTA Affidavit in customary form or (ii) in the case of a seller or
assignor but not Lessee, if such seller is, a "foreign person" as defined in
Section 1445 of the Code, evidence that a portion of the sales price to be paid
to such seller or assignor has been withheld, if so required, in accordance with
the provisions of the Code and the Regulations.
(n) NO EVENT OF LOSS. No Casualty in excess of $1,000,000 shall
have occurred subsequent to the date of the Additional Property Appraisal but
prior to the Acquisition Date and no Event of Loss shall have occurred in
respect of the Additional Property on the Acquisition Date. No action shall be
pending or threatened by an Authority to initiate a Condemnation or an Event of
Taking in respect of the Additional Property on the Acquisition Date.
(o) GOOD STANDING. Lessee shall have delivered to Administrative
Agent a certificate issued by the office of the secretary of state of the
jurisdiction in which such Property is located indicating that such Lessee is a
corporation in good standing under the laws of such jurisdiction.
(p) SECRETARY'S CERTIFICATE. The Administrative Agent shall have
received from Lessee (with sufficient copies for distribution to each
Participant) (a) an incumbency certificate regarding the officers authorized to
execute and deliver the Operative Documents to which it is a party and other
documents and agreements delivered in connection therewith; (b) certified copies
of all documents evidencing the corporate actions of Lessee, including
resolutions of the boards of directors or delegations of authority of Lessee
duly authorizing the execution, delivery and performance by Lessee of each of
the Operative Documents to which it is or is to be a party and the transactions
contemplated hereby and thereby; (c) certified copies of the bylaws and charter
of Lessee; and (d) such other documents and evidence with respect to Lessee as
any Participant may reasonably request in order to establish the consummation of
the transactions contemplated by the Operative Documents, the taking of all
corporate proceedings in connection therewith and compliance with the conditions
herein set forth.
(q) ENVIRONMENTAL INDEMNITY. Lessor shall have received an
Environmental Indemnity with respect to the Additional Property duly executed by
Lessee, as Indemnitor.
All or any portion of any Commitment may be suspended by reason of the
inability to satisfy any condition in this ARTICLE III.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 REPRESENTATIONS AND WARRANTIES OF LESSEE. As of the date hereof and
each Advance Date, Lessee represents and warrants to each of the other parties
hereto as follows; provided, however, that to the extent that the
representations or warranties in SECTIONS 4.1(o) (p)(ii), (q), (r), (t), (x) and
(y) are given with respect to the Additional Property, such representations or
warranties shall be deemed to have first been made on the Acquisition Date with
respect to the Additional Property and on each Advance Date thereafter:
(a) CORPORATE EXISTENCE; COMPLIANCE WITH LAW. Lessee and each
Subsidiary of Lessee (i) is duly organized or formed, validly existing and (in
the case of Lessee and its Material Subsidiaries) in good standing under the
laws of the jurisdiction of its organization, (ii) has the corporate power and
authority and legal right to own and operate its property, to lease the property
it operates as lessee and to conduct the business in which it is currently
engaged, (iii) is in compliance with all Requirements of Law, except to the
extent that all failures to comply therewith could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect, and (iv) in the case
of Lessee and its Material Subsidiaries, is duly qualified and in good standing
to do business in each jurisdiction in which the nature or conduct of its
business or the ownership, leasing, operation or holding of its properties
requires such qualification, except to the extent that all failures to be so
qualified could not in aggregate have a Material Adverse Effect.
(b) CORPORATE POWER; AUTHORIZATION. Lessee has the power and
authority, and the legal right, to make, deliver and perform this Agreement and
all other Operative Documents to which it is a party. Lessee has taken all
necessary corporate action to authorize the execution, delivery and performance
of this Agreement and the other Operative Documents to which it is a party. No
consent or authorization of, filing with, notice to or other act by or in
respect of, any Person (including any Authority) is required in connection with
the execution, delivery or performance by Lessee, or for the validity or
enforceability against, the Lessee of this Agreement or any other Operative
Document except for the consents, authorizations and filings which have been
obtained or made and are in full force and effect.
(c) ENFORCEABLE OBLIGATIONS. This Agreement and each Operative
Document to which Lessee is a party has been duly executed and delivered by
Lessee and constitutes the legal, valid and binding obligation of Lessee
enforceable against Lessee in accordance with its terms, subject to the effects
of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium, or
other similar laws relating to or affecting creditors' rights generally, general
principles of equity (regardless of whether considered in a proceeding in equity
or at law) and an implied covenant of good faith and fair dealing.
(d) NO LEGAL BAR. The execution, delivery and performance of each
Operative Document to which Lessee is a party will not violate any Requirement
of Law or Contractual Obligation of Lessee or any of its Subsidiaries and will
not result in, or require, the creation or imposition of any Lien on any of its
or their respective properties or revenues pursuant to any such Requirement of
Law or Contractual Obligations, except for the Liens created under the Operative
Documents.
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(e) NO MATERIAL LITIGATION. No litigation, investigation or
proceeding of or before any arbitrator or Authority is pending or, to the
knowledge of a Responsible Officer of Lessee, threatened by or against Lessee or
any of its Subsidiaries or against any of its or their respective properties or
revenues with respect to (a) any of the Operative Documents or any of the
transactions, contemplated thereby or (b) which could reasonably be expected to
have a Material Adverse Effect.
(f) INVESTMENT COMPANY ACT; OTHER REGULATIONS. Lessee 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. Lessee is not
subject to regulation under any Federal or State statute or regulation (other
than Regulation X of the Board of Governors of the Federal Reserve System) which
limits its ability to incur Indebtedness.
(g) NO DEFAULT. Neither Lessee nor any Subsidiary is in default
under or with respect to any of its Contractual Obligations in any respect which
could reasonably be expected to have a Material Adverse Effect. No Default or
Event of Default has occurred and is continuing.
(h) TAXES. Lessee and each of its Material Subsidiaries, has filed
or caused to be filed all Tax returns which, to the knowledge of a Responsible
Officer of Lessee or any Material Subsidiary, are required to be filed. All
Taxes shown to be due and payable on such Tax returns or on any assessments made
against it or any of its property and all other Taxes imposed on it or any of
its property by any Authority have been timely paid in full (other than any
Taxes the amount or validity of which are currently being contested in good
faith by appropriate proceedings and with respect to which reserves in
conformity with GAAP have been provided on the books of Lessee or its
Subsidiaries, as the case may be), and no Tax Liens have been filed and, to the
knowledge of a Responsible Officer of Lessee, no claims are being asserted
against Lessee or any Material Subsidiary with respect to any Taxes, fees or
other charges.
(i) SUBSIDIARIES. The Subsidiaries of Lessee listed on
SCHEDULE 4.1B constitute all of the Domestic Subsidiaries of Lessee and the
Subsidiaries listed on SCHEDULE 4.LC constitute all of the Foreign Subsidiaries
of Lessee as of the Documentation Date.
(j) OWNERSHIP OF PROPERTY; LIENS. Lessee and each of its Material
Subsidiaries, has good record and marketable title in fee simple to, or a valid
leasehold interest in, all of its real property, and good title to, or a valid
interest in, all of its other property, and none of such property is subject to
any Lien other than Permitted Liens.
(k) RIGHTS IN RESPECT OF THE PROPERTIES. Lessee is not a party to
any contract or agreement to sell any interest in any Property or any part
thereof other than pursuant to or in accordance with this Agreement and the
Lease.
(l) NO DEFAULT, LOSS, ETC. As of each Advance Date: no Default,
Event of Default, Event of Loss or Casualty (where Lessee reasonably expects
repair and restoration costs resulting from such casualty to exceed $10,000,000
with respect to the Original Property or, with respect to any Advance Date
occurring on or after the Acquisition Date, $6,000,000 with respect to the
Additional Property) has occurred and is continuing; there is no action pending
or, to the
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Participation Agreement
knowledge of a Responsible Officer of Lessee threatened by an Authority to
initiate an Event of Taking; no condition exists that constitutes, or with the
giving of notice or lapse of time or both would constitute an event of default
by it under any material indenture, mortgage, chattel mortgage, deed of trust,
lease, conditional sales contract, loan or credit arrangement or other material
agreement or instrument to which it is a party or by which it or any of its
properties may be bound which individually or in the aggregate with all such
events of default could have a Material Adverse Effect.
(m) CHIEF EXECUTIVE OFFICE OF LESSEE. The principal place of
business and chief executive office, as such terms are used in Section 9-307 of
the UCC, of the Lessee are located at 1895 J.W. Foster Boulevard, Canton,
Massachusetts 02021. Lessee is a corporation organized under the laws of
Massachusetts. Lessee's federal employer identification number is 04-2678061.
The name of Lessee appearing on the first page hereof is Lessee's exact legal
name as it appears in the public records of Massachusetts.
(n) COMPLIANCE WITH LAW. With respect to the Original Land and the
construction and use of the Original Facility and with respect to the Additional
Facility upon its acquisition, (i) Lessee has at all times complied with and is
in compliance with and will comply with all Applicable Laws, including all
Environmental Laws, except for any violations which would not have a Material
Adverse Effect; (ii) each Property and the use thereof by Lessee and its
administrative agents, assignees, employees, invitees, lessees, licensees and
tenants complies in all material respects with all Applicable Laws (including
all zoning and land use laws and Environmental Laws) and insurance requirements;
and (iii) each Facility and any other improvements on such Property do not
encroach in any material respect onto any adjoining land (except as permitted by
express written easements or as insured by appropriate title insurance). There
are no underground storage tanks at any Property except such underground storage
tanks as are in compliance with Environmental Laws.
(o) LICENSES, REGISTRATIONS AND PERMITS. All material licenses,
approvals, authorizations, consents, permits (including building, demolition and
environmental permits, licenses, approvals, authorizations and consents),
easements and rights-of-way, including proof and dedication (collectively, the
"PERMITS"), required for the use and occupancy of each Property and for the
operation thereof (including a certificate or certificates of occupancy for each
Facility or other legally equivalent permission to occupy such Facility) have
either been obtained from the appropriate Authorities having jurisdiction or
from private parties, as the case may be, or will be obtained from the
appropriate Authorities having jurisdiction or from private parties, as the case
may be, prior to commencing any such use and/or operation, as applicable.
Lessee, as Construction Agent under the Original Operative Documents and its
contractors have assigned to Lessor, to the extent assignable under applicable
law, all of their respective interests in all such Permits relating to the
Original Property.
(p) NATURE, CONDITION AND USE OF PROPERTY.
(i) The Original Facility was constructed on the Original
Land pursuant to the Construction Agency Agreement. Such Property is
located in Massachusetts in the County of Norfolk. The condition and
use of such Property conforms, in all material respects, with all
conditions or requirements of all
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Participation Agreement
existing permits and approvals issued with respect to the Original
Land and the Original Facility. Lessee's use of such Property under
the Lease does not and will not, in any material respect, violate any
Applicable Law. No notices, complaints or orders of violation or
non-compliance or liability of any nature whatsoever have been issued
or threatened by any Person with respect to the Original Property or
any present or intended future use thereof, except for such
violations and instances of non-compliance as could not reasonably be
expected to have, individually or in the aggregate, a Material
Adverse Effect on the Original Property, and Responsible Officers of
Lessee are not aware of any circumstances which could give rise to
the issuance of any such notices, complaints or orders. The Original
Property complies, in all material respects, with Applicable Law.
With respect to the Original Facility, (A) there are no material
defects to such Facility, including the plumbing, heating, air
conditioning and electrical systems thereof and (B) all water, sewer,
electric, gas, telephone and drainage facilities and all other
utilities required to adequately service such Facility for its
primary intended use are available pursuant to adequate permits
(including any that may be required under applicable Environmental
Laws).
(ii) The Property to be acquired on the Acquisition Date
consists of land on which a facility suitable for use as a
manufacturing facility has been constructed. Such Property is located
in Massachusetts in the County of Norfolk and will be subleased to
Seller pursuant to the Additional Property Sublease. The condition
and use of Property will conform, in all material respects, with all
conditions or requirements of all existing permits and approvals
issued with respect to such Property. Lessee's and its tenants'
present or future intended use of such Property under the Lease does
not and will not, in any material respect, violate any Applicable
Law. No notices, complaints or orders of violation or non-compliance
or liability of any nature whatsoever have been issued or threatened
by any Person with respect to such Property or any present or
intended future use thereof, except for such violations and instances
of non-compliance as could not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect on such
Property, and Responsible Officers of Lessee are not aware of any
circumstances which could give rise to the issuance of any such
notices, complaints or orders. Such Property complies in all material
respects, with Applicable Law. With respect to the Additional
Facility, (A) there are no material defects to such Facility,
including the plumbing, heating, air conditioning and electrical
systems thereof and (B) all water, sewer, electric, gas, telephone
and drainage facilities and all other utilities required to
adequately service such Facility for its primary intended use are
available pursuant to adequate permits (including any that may be
required under applicable Environmental Laws).
(q) UTILITY SERVICES. Each Property has available all material
services of public facilities and other utilities necessary for use and
operation of the Facility thereon for its primary intended purposes including
adequate water, gas and electrical supply, storm and sanitary sewerage
facilities, telephone, other required public utilities and means of access
between such Facility and public highways for pedestrians and motor vehicles.
All utilities serving such
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Participation Agreement
Property are located in, and vehicular access to the Property is provided by,
either public rights-of-way abutting such Property or by Appurtenant Rights.
(r) USE AND OPERATION OF THE PROPERTIES. All material agreements,
easements and other rights, public or private, which are necessary to permit the
lawful use and operation of each Property as the Lessee and its tenants intend
to use such Property under the Lease and which are necessary to permit the
lawful intended use and operation of all utilities, driveways, roads and other
means of egress and ingress to and from the same have been obtained and are in
full force and effect, and Responsible Officers of Lessee have no actual
knowledge of any pending modification which would materially and adversely
affect the operation of the Facility located thereon or cancellation of the
same; and all required building and use-related permits, approvals, licenses,
and consents material to the construction, use and operation of such Facility
have been issued and were in full force and effect on or prior to the date such
permits, approvals, licenses and consents are or become necessary.
(s) SECURITIES ACT. Neither Lessee nor anyone authorized to act on
behalf of Lessee (it being understood that this representation is not being made
with respect to Credit Suisse First Boston and its Affiliates) has, directly or
indirectly, in violation of Section 5 of the Securities Act or any state
securities laws, offered or sold any interest in the Notes, the Properties or
the Lease, or in any security or lease the offering of which, for purposes of
the Securities Act or any state securities laws, would be deemed to be part of
the same offering as the offering of the aforementioned securities or leases, or
solicited any offer to acquire any of the aforementioned securities or leases.
(t) TITLE. Neither Lessee nor any of its Affiliates has taken or
caused to be taken any action which would have an adverse effect on Lessor's
title to the Property from that indicated in the Title Policies to be delivered
pursuant to SECTION 3.1 and 3.3. Neither Lessee nor any of its Affiliates has
created, consented to, incurred or suffered to exist any Lien upon either
Property other than Permitted Liens.
(u) FEDERAL RESERVE REGULATIONS. No part of the proceeds of any
Advances will be used in any manner which would violate, or result in the
violation of, Regulation U of the Board of Governors of the Federal Reserve
System, as now and from time to time hereafter in effect. If requested by any
Lender or the Administrative Agent, the Lessee will furnish to the
Administrative Agent and each Lender a statement to the foregoing, effect in
conformity with the requirements of FR Form U-1 referred to in said Regulation
U.
(v) ERISA. Neither a Reportable Event nor an "accumulated funding
deficiency" (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan, and each Plan
has complied in all material respects with the applicable provisions of ERISA
and the Code. No termination of a Single Employer Plan has occurred, and no Lien
in favor of the PBGC or a Plan has arisen, during such five-year period. The
present value of all accrued benefits under each Single Employer Plan (based on
those assumptions used to fund such plan) did not, as of the last annual
valuation date prior to the date on which this representation is made or deemed
made, exceed the value of the assets of such Plan allocable to such accrued
benefits. Neither the Company nor any Commonly Controlled Entity
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Participation Agreement
has had a complete or partial withdrawal from any Multiemployer Plan, and
neither the Company nor any Commonly Controlled Entity would become subject to
any liability under ERISA if the Company or any such Commonly Controlled Entity
were to withdraw completely from all Multiemployer Plans as of the valuation
date most closely preceding the date on which this representation is made or
deemed made. No such Multiemployer Plan is in Reorganization or Insolvency. The
present value (determined using actuarial and other assumptions which are
reasonable in respect of the benefits provided and the employees participating)
of the liability of the Company and each Commonly Controlled Entity for
post-retirement benefits to be provided to their current and former employees
under Plans which are welfare benefit plans (as defined in Section 3(1) of
ERISA) does not, in the aggregate, exceed the assets under all such Plans
allocable to such benefits by an amount in excess of $10,000,000.
(w) FINANCIAL CONDITION.
(i) The consolidated balance sheet (the "BALANCE SHEET") of
the Lessee and its consolidated Subsidiaries as of December 31, 2003
and the related consolidated statements of income and of cash flows
for the fiscal year ended on such date, reported on by Ernst & Young
LLP, copies of which have heretofore been furnished to each of the
Participants, are complete and correct and present fairly in all
material respects the consolidated financial condition of the Lessee
and its consolidated Subsidiaries as at such date, and the
consolidated results of their operations and their consolidated cash
flows for the fiscal year then ended.
(ii) All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with
GAAP applied consistently throughout the periods involved (except as
approved by such accountants or Responsible Officer, as the case may
be, and as disclosed therein). Neither the Lessee nor any of its
consolidated Subsidiaries had, at the date of the most recent balance
sheet referred to above, any material Guarantee Obligation,
contingent liability or liability for taxes, or any long-term lease
or unusual forward or long-term commitment, including any interest
rate or foreign currency swap or exchange transaction, which is not
reflected in the foregoing statements or in the notes thereto. Except
to the extent permitted under this Agreement or separately disclosed
to the Participants in writing prior to the date hereof, there has
been no sale, transfer or other disposition by the Lessee or any of
its consolidated Subsidiaries of any material part of its business or
property and no purchase or other acquisition of any business or
property (including any capital stock of any other Person) material
in relation to the consolidated financial condition of the Lessee and
its consolidated Subsidiaries at December 31, 2003 during the period
from December 31, 2003 to and including the date hereof.
(x) NO OTHER FILINGS. On the Documentation Date and Acquisition
Date, except for the filings and recordings listed in SCHEDULE 4.LA (which
filings or recordings shall have been duly made on the applicable Advance Date,
or shall have been arranged to be made promptly thereafter (including the
payment of any fees or taxes relating to any of the foregoing) in a manner
satisfactory to Administrative Agent), no other filings or recordings are
necessary to validly and effectively maintain in Lessor and Administrative
Agent, or convey to Lessor and
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Participation Agreement
Administrative Agent, such interests in the Original Property and the Additional
Property and the Collateral as contemplated by the Operative Documents, in each
case free and clear of all Liens, other than Permitted Liens.
(y) ZONING. The Original Property complies, and, on the Acquisition
Date therefor the Additional Property will comply, in all material respects with
all applicable zoning and subdivision laws, ordinances, regulations and
restrictive covenants, and all requirements thereof necessary for the use,
occupancy and operation of such Property have been, or upon the acquisition of
such Property will be, satisfied in all material respects, and the current use
and intended use under the Lease of such Properties is a conforming use.
(z) DISCLOSURE. No information, schedule, exhibit or report or
other document furnished by the Lessee or any of its Subsidiaries to the
Administrative Agent or any Participant in connection with the negotiation of
this Agreement or any of the other Operative Documents (or pursuant to the terms
hereof or thereof), as such information, schedule, exhibit or report or other
document has been amended, supplemented or superseded by any other information,
schedule, exhibit or report or other document later delivered to the same
parties receiving such information, schedule, exhibit or report or other
document, contained any material misstatement of fact or omitted to state a
material fact or any fact necessary to make the statements contained herein or
therein, in light of the circumstances when made, not materially misleading.
(aa) APPRAISAL DATA. The information provided by Lessee and its
Affiliates to the Appraiser and forming the basis for the conclusions set forth
in the Appraisals, taken as a whole, was true and correct in all material
respects and did not omit any information necessary to make the information
provided not materially misleading.
(bb) SUBJECTION TO GOVERNMENT REGULATION. None of Administrative
Agent, Lessor nor any Lender will become (i) solely by reason of entering into
the Operative Documents or consummation of the transactions contemplated thereby
(other than upon exercise of remedies under the Lease or upon the expiration
thereof), subject to ongoing regulation of its operations by any Authority
having jurisdiction solely by reason of any of Lessee's business activities or
the nature of the Properties; or (ii) except for regulation the applicability of
which depends upon the existence of facts in addition to the ownership of, or
the holding of any interest in, the Properties or any interest therein upon the
exercise of remedies under the Lease or upon the expiration thereof, subject to
ongoing regulation of its operations by any Authority having jurisdiction solely
by reason of any of Lessee's business activities or the nature of the
Properties.
(cc) INTELLECTUAL PROPERTY. Each of the Lessee and its Subsidiaries
owns, or is licensed to use, all trademarks, tradenames, copyrights, technology,
know-how and processes necessary for the conduct of its business as currently
conducted, except for those the failure to own or license which could not
reasonably be expected to have a Material Adverse Effect (the "INTELLECTUAL
PROPERTY"). No claim has been asserted and is pending by any Person challenging
or questioning the use of any such Intellectual Property or the validity or
effectiveness of any such Intellectual Property which, if accurate, could
reasonably be expected to have a Material Adverse Effect, nor does the Lessee
know of any valid basis for any such claim. To the knowledge of Responsible
Officers of the Lessee, the use of such Intellectual Property by the Lessee and
its Subsidiaries does not infringe on the rights of any Person, except for such
claims and
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Participation Agreement
infringements that, in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
(dd) TAX SHELTER REGULATIONS. Lessee does not intend to treat the
Lease, the Loans and/or Investor Balance and related transactions as being a
"reportable transaction" (within the meaning of Treasury Regulation Section
1.6011-4). In the event Lessee determines to take any action inconsistent with
such intention, it will promptly notify Administrative Agent thereof. If Lessee
so notifies Administrative Agent, Lessee acknowledges that Administrative Agent
and/or one or more of the Lenders or Lessor may treat its Loans and/or its
interest in the Investor Balance as part of a transaction that is subject to
Treasury Regulation Section 1.6011-4 or Section 301.6112-1, and the
Administrative Agent and Lessor or such Lenders, as applicable, may file such
IRS forms or maintain such lists and other records as they may determine is
required by such Treasury Regulation.
(ee) NO CHANGE. Since December 31, 2003, there has been no
development or event which has had or could reasonably be expected to have a
Material Adverse Effect.
4.2 REPRESENTATIONS AND WARRANTIES OF EACH PARTICIPANT. Each Participant
represents and warrants severally and only as to itself to each of the other
parties hereto as follows:
(a) Lessor represents and warrants that:
(i) CORPORATE POWER: AUTHORIZATION. It has the power and
authority, and the legal right, to make, deliver and perform this
Agreement and all other Operative Documents to which it is a party.
Lessor has taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement and the other
Operative Documents to which it is a party. No consent or
authorization of, filing with, notice to or other act by or in
respect of, any Person (including any Authority) is required in
connection with the execution, delivery or performance by Lessor, or
for the validity or enforceability against, the Lessor of this
Agreement or any other Operative Document except for the consents,
authorizations and filings which have been obtained or made and are
in full force and effect.
(ii) ENFORCEABLE OBLIGATIONS. This Agreement and each
Operative Document to which Lessor is a party has been duly executed
and delivered by Lessor and constitutes the legal, valid and binding
obligation of Lessor enforceable against Lessor in accordance with
its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium, or other similar
laws relating to or affecting creditors' rights generally, general
principles of equity (regardless of whether considered in a
proceeding in equity or at law) and an implied covenant of good faith
and fair dealing.
(iii) DUE ORGANIZATION, ETC. It is duly organized and validly
existing under the laws of the jurisdiction of its organization and
has full power and authority to enter into and perform its
obligations as Lessor or Borrower (as the case may be) under each
Operative Document to which it is or is to be a party and
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Participation Agreement
each other agreement, instrument and document to be executed and
delivered by it on or before each Advance Date in connection with or
as contemplated by each such Operative Document to which it is or is
to be a party.
(iv) LESSOR LIENS. The Original Property is, and upon
acquisition the Additional Property will be, free and clear of all
Lessor Liens attributable to it.
(v) ERISA. It has funded and will fund the Invested Amount
with assets that are either (i) not assets of any Employee Benefit
Plan (or its related trust) which is subject to Title I of ERISA or
Section 4975 of the Code; or (ii) assets of any Employee Benefit Plan
(or its related trust) which is subject to Title I of ERISA or
Section 4975 of the Code, but there is available an exemption from
the prohibited transaction rules under Section 406(a) of ERISA and
Section 4975 of the Code and such exemption is immediately applicable
to each transaction contemplated by the Operative Documents to the
extent that any other party to such transaction is a "party in
interest" as defined in Section 3 (14) of ERISA with respect to such
plan assets.
(b) Each Lender represents and warrants that:
(i) ERISA. It is purchasing its interest in the Notes with
assets that are either (i) not assets of any Employee Benefit Plan
(or its related trust) which is subject to Title I of ERISA or
Section 4975 of the Code; or (ii) assets of any Employee Benefit Plan
(or its related trust) which is subject to Title I of ERISA or
Section 4975 of the Code, but there is available an exemption from
the prohibited transaction rules under Section 406(a) of ERISA and
Section 4975 of the Code and such exemption is immediately applicable
to each transaction contemplated by the Operative Documents to the
extent that any other party to such transaction is a "party in
interest" as defined in Section 3(14) of ERISA with respect to such
plan assets.
(ii) INVESTMENT IN NOTES. In the event that the Notes are
determined to be securities, it is acquiring the Notes 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 Notes, it understands that it may do so only in compliance with
the Securities Act and the rules and regulations of the SEC
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 Note or any
interest in the Property, the Collateral or the Lease to the
registration requirements of Section 5 of the Securities Act. No
representation or warranty contained in this SECTION 4.2(b) shall
include or cover any action or inaction of Lessee or any Affiliate
thereof whether or not purportedly on behalf of any Participant or
any of their Affiliates.
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ARTICLE V
COVENANTS OF LESSEE
5.1 FURTHER ASSURANCES. Lessee, at its own cost and expense, will cause
to be promptly and duly taken, executed, acknowledged and delivered all such
further acts, documents and assurances as Lessor or Administrative Agent
reasonably may request from time to time in order to carry out more effectively
the intent and purposes of this Agreement and the other Operative Documents and
the Overall Transaction. Lessee, at its own cost and expense, will cause all
financing statements (including precautionary financing statements), fixture
filings and other documents, to be recorded or filed at such places and times in
such manner, and will take all such other actions or cause such actions to be
taken, as may be necessary or as may be reasonably requested by Lessor or
Administrative Agent in order to establish, preserve, protect and perfect the
title of Lessor to the Properties, as the case may be, and Lessor's rights under
this Agreement and the other Operative Documents and to perfect, preserve and
protect the first and prior Lien of the Mortgage on the Collateral. Lessee will
maintain in full force and effect all Permits. Upon any transfer of either
Property, whether pursuant to any provision of the Operative Documents
(including Article VI of the Lease) or after the occurrence of a Lease Event of
Default or otherwise, Lessee, at its own cost and expense, will cause to be
promptly and duly taken, executed, acknowledged and delivered all such further
acts, documents and assurances as Lessor or Administrative Agent reasonably may
request from time to time in order to cause the Permits to be transferred or
reissued in the name of the Person acquiring such Property.
5.2 LIMITATION ON FUNDAMENTAL CHANGES. None of the Lessee or any of its
Subsidiaries shall enter into any merger, consolidation or amalgamation to which
it is not the continuing, or surviving corporation, or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution), except that any
Subsidiary of Lessee may be merged or consolidated with or into Lessee,
(provided that Lessee shall be the continuing or surviving corporation) or with
or into any one or more wholly owned Subsidiaries of the Lessee (PROVIDED that
the wholly owned Subsidiary or Subsidiaries shall be the continuing or surviving
corporation).
5.3 [RESERVED].
5.4 [RESERVED].
5.5 LIENS. Lessee shall not incur or suffer to exist any Lien on the
Property following the Lease Commencement Date for such Property, other than
Permitted Liens.
5.6 LIMITATION ON SALE OF ASSETS. Lessee shall not, and shall not permit
any of its Subsidiaries to, convey, sell, lease, assign, transfer or otherwise
dispose of all or substantially all of the property, business or assets
(including, without limitation, receivables and leasehold interests) of Lessee
and its Subsidiaries taken as a whole, whether now owned or hereafter acquired
in any single transaction or any series of related transactions. Notwithstanding
the foregoing provision of this SUBSECTION 5.6, the trademark "Reebok" shall at
all times be subject to a valid license agreement in favor of the Lessee having
terms substantially similar to the License Agreement described in subsection
7.5(b) of the Revolving Credit Agreement.
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5.7 CHANGE OF NAME OR ADDRESS. Lessee shall provide the Administrative
Agent (with sufficient copies for each Participant) thirty (30) days' prior
written notice of (i) any change in name, identity, jurisdiction of
incorporation, state organization number, if any, or corporate structure of
Lessee or the address of the chief executive office and principal place of
business of Lessee or the office where Lessee keeps its records concerning its
accounts and the Property or (ii) any change with respect to the places of
business of Lessee whereby it will thereafter have a place of business in other
counties in the Commonwealth of Massachusetts or will thereafter have no place
of business in the Commonwealth of Massachusetts.
5.8 ENVIRONMENTAL MATTERS. Following the Lease Commencement Date for a
Property, (a) Lessee shall comply in all material respects at all times with
Applicable Laws affecting such Property, including all Environmental Laws, and
shall maintain at such Property only such quantities of Hazardous Materials, if
any, as are necessary for the ongoing operation of such Property or held for
resale by Lessee, and in all events, such Hazardous Materials shall be held in
compliance with all Applicable Laws; and (b) Lessee shall not cause or permit
the installation of any underground storage tanks at such Property.
5.9 INVESTIGATION BY AUTHORITIES. Following the Lease Commencement Date
for a Property, Lessee shall deliver to the Administrative Agent (with
sufficient copies for each Participant) promptly upon Lessee's receiving notice
of the intent by any Authority to (x) take an action which would constitute a
Condemnation or an Event of Taking in respect of such Property, (y) investigate
such Property for a material violation of any Applicable Law on or at such
Property, including any Environmental Law, under which liability may be imposed
upon any Participant or under which liability having a Material Adverse Effect
may be imposed on Lessee or (z) investigate such Property (other than routine
fire, life-safety and similar inspections) for any violation of Applicable Law
under which criminal liability may be imposed upon any Participant or
Administrative Agent under which liability having a Material Adverse Effect may
be imposed on Lessee.
5.10 FINANCIAL STATEMENTS; CERTIFICATES; OTHER INFORMATION. Lessee shall
furnish to the Administrative Agent (with sufficient copies for each
Participant):
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of the Lessee, a copy of the consolidated balance sheets
of the Lessee and its consolidated Subsidiaries as at the end of such fiscal
year and the related consolidated statements of income and retained earnings and
of cash flows for such fiscal year, setting forth in each case in comparative
form the figures for the previous year reported on without a "going concern" or
like qualification or exception, or qualification arising out of the scope of
the audit, by Ernst & Young LLP or other independent certified public
accountants of nationally recognized standing; and
(b) as soon as available, but in any event not later than 45 days
after the end of each of the first three, quarterly periods of each fiscal year
of the Lessee, the unaudited consolidated balance sheets of the Lessee and its
consolidated Subsidiaries as at the end of each such quarter and the related
unaudited consolidated statements of income and retained earnings and of cash
flows of the Lessee and its consolidated Subsidiaries for such quarter and the
portion of the fiscal year through the end of such quarter, setting forth in
each case in comparative form
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the figures for the previous year, certified by a Responsible Officer as being
fairly stated in all material respects (subject to normal year-end audit
adjustments); all such financial statements shall be complete and correct in all
material respects and shall be prepared in reasonable detail and in accordance
with GAAP applied consistently throughout the periods reflected therein and with
prior periods (except as approved by such accountants or officer, as the case
may be, and disclosed therein);
(c) promptly upon receipt thereof, copies of all updates to either
Environmental Audit;
(d) concurrently with the delivery of the financial statements
referred to in SECTION 5.10(a), a certificate of the independent certified
public accountants reporting on such financial statements stating that in making
the examination necessary therefor no knowledge was obtained of any Default or
Event of Default, except as specified in such certificate;
(e) concurrently with the delivery of the financial statements
referred to in SECTIONS 5.10(a) and (b), a certificate of a Responsible Officer
(i) stating that, to the best knowledge of such Responsible Officer, the Lessee
has observed or performed all of its covenants and other agreements, and
satisfied every condition, contained in this Agreement and the other Operative
Documents to be observed, performed or satisfied by it, and that such Officer
has obtained no knowledge of any Default, Event of Default, Event of Loss,
Condemnation or Casualty except as specified in such certificate (such
certificate to include, in the case of any such condition or event, the nature
and period of existence thereof and what action Lessee has taken or is taking or
proposes to take with respect thereto) and (ii) setting forth the computations
used by the Company in determining (as of the end of such fiscal period)
compliance with the covenants contained in SUBSECTION 5.18; or
(f) following the Documentation Date and until the termination of
the Lease, to Administrative Agent, a certificate of the Lessee signed by a
Responsible Officer of the Lessee promptly after Lessee obtains knowledge that
there exists a Lease Default or Lease Event of Default, which such certificate
shall describe such Lease Default or Lease Event of Default in reasonable
detail, with a statement of Lessee's action with respect thereto taken or
proposed to be taken;
(g) within five days after the same are sent, copies of all
financial statements, and reports which the Company sends to its stockholders,
and within five days after the same are filed, copies of all financial
statements and reports which the Company may make to, or file with, the
Securities and Exchange Commission or any successor or analogous Governmental
Authority; and
(h) promptly, such additional financial and other information as
any Participant may from time to time reasonably request; and
(i) concurrently with the delivery to Lessor of a notice or
communication under the Lease, a copy of such notice or communication.
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All financial statements furnished pursuant to SECTIONS 5.10(a) and (b) shall be
complete and correct in all material respects and shall be prepared in
reasonable detail and in accordance with GAAP applied consistently throughout
the periods reflected therein and with prior periods (except as approved by such
accountants or Responsible Officer, as the case may be, and disclosed therein).
5.11 SECURITIES. Lessee shall not, nor shall it permit anyone authorized
to act on its behalf to, take any action which would subject the issuance or
sale of either Property or the Notes, Lease or other Operative Documents, or in
any security or lease the offering of which, for purposes of the Securities Act
or any state securities laws, would be deemed to be part of the same offering as
the offering of the aforementioned securities or leases to the registration
requirements of Section 5 of the Securities Act or any state securities laws.
5.12 INTEREST RATES. With respect to each determination of Yield pursuant
to this Agreement and an interest rate pursuant to the Loan Agreement, Lessee
agrees to be bound by Section 2.7 of the Loan Agreement in connection with the
calculation of Basic Rent and Supplemental Rent (to the extent it is calculated
in respect of the Overdue Rate).
5.13 PAYMENT OF OBLIGATIONS. Lessee shall, and shall cause each of its
Subsidiaries to, pay, discharge or otherwise satisfy at or before maturity in
accordance with customary terms or before they become delinquent, as the case
may be, all its material obligations and liabilities of whatever nature, except
when the amount or validity thereof is currently being contested in good faith
by appropriate proceedings and reserves in conformity with GAAP with respect
thereto have been provided on the books of the Lessee or any of its
Subsidiaries, as the case may be.
5.14 CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. Lessee shall, and
shall cause each of its Subsidiaries to, continue to engage in business of the
same general type as now conducted by it and preserve, renew and keep in full
force and effect its corporate existence and take all reasonable action to
maintain all rights, privileges and franchises necessary or (in the reasonable
judgment of Lessee) desirable in the normal conduct of its business except as
otherwise permitted by SECTION 5.2 and comply with all Contractual Obligations
and Requirements of Law except to the extent that the failure to comply
therewith could not, in the aggregate, be reasonably expected to have a Material
Adverse Effect.
5.15 MAINTENANCE OF PROPERTY; INSURANCE. Without limiting Lessee's
obligations under Article XI of the Lease, Lessee shall, and shall cause each of
its Subsidiaries to:
(a) keep all material property useful and necessary in its business
in good working order and condition;
(b) in addition to, and not in limitation of, the Insurance
Requirements and the provisions of Article XI of the Lease, maintain with
financially sound and reputable insurance companies insurance on all its
material property in at least such amounts and against at least such risks (but
including, in any event, public liability and product liability insurance) as
are usually insured against in the same general area, by companies engaged in
the same or a similar business; and furnish to the Administrative Agent, upon
written request, full information as to the insurance carried;
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(c) keep in full force and effect, and comply in all material
respects with the terms of, a license agreement between the Lessee and any
wholly-owned Subsidiary of the Lessee or of Reebok U.K. which is substantially
similar in form and substance to the License Agreement, dated as of August 6,
1979, between the Lessee (as successor to Reebok U.S.A. Limited, Inc.) and
Reebok U.K., as the same may be amended, supplemented or otherwise modified in a
manner which could not reasonably be expected to have a Material Adverse Effect.
5.16 INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS. Lessee shall,
and shall cause each of its Subsidiaries to, keep proper books of record and
account in which full, true and correct entries in conformity with GAAP and all
Requirements of Law shall be made of all dealings and transactions in relation
to its business and activities; and permit representatives of any Lender to
visit and inspect any of its properties and examine and make abstracts from any
of its books and records at any reasonable time (upon reasonable advance notice,
when no Default or Event of Default has occurred and is continuing) and as often
as may reasonably be desired and to discuss the business, operations, properties
and financial and other condition of the Lessee and its Subsidiaries with
officers and employees of Lessee and its Subsidiaries and with its independent
certified public accountants.
5.17 NOTICES. Lessee shall promptly give notice to the Administrative
Agent:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual
Obligation of the Lessee or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time between the Lessee or
any of its Subsidiaries and any Governmental Authority, which in either case, if
not cured or if adversely determined, as the case may be, could reasonably be
expected to have a Material Adverse Effect;
(c) any litigation or proceeding affecting the Lessee or any of its
Subsidiaries in which the amount involved is $10,000,000 or more and not covered
by insurance or in which injunctive or similar relief is sought which could have
a Material Adverse Effect;
(d) the following events, as soon as possible and in any event
within 30 days after the Lessee knows or has reason to know thereof: (i) the
occurrence or expected occurrence of any Reportable Event with respect to any
Plan, a failure to make any required contribution to a Plan, the creation of any
Lien in favor of the PBGC or a Plan or any withdrawal from, or the termination,
Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution
of proceedings or the taking of any other action by the PBGC or the Lessee or
any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the terminating, Reorganization or Insolvency of, any Plan;
(e) any change in the Credit Rating of the Lessee promptly upon the
effectiveness thereof; and
(f) the occurrence of (i) any material adverse change in the
business, operations, property, condition (financial or otherwise) or prospects
of the Lessee and its Subsidiaries taken as a whole or (ii) any development or
event which could reasonably be
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expected to have a material adverse effect on the rights or remedies of the
Administrative Agent or the Lenders hereunder or under any of the other
Operative Documents.
Each notice pursuant to this SECTION 5.17 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the Lessee proposes to take with respect
thereto.
5.18 FINANCIAL CONDITION COVENANTS. Lessee hereby agrees that, so long as
the Commitments remain in effect or any amount is owing to any Participant or
the Administrative Agent hereunder or under any other Operative Document, Lessee
shall not, and (except with respect to SECTION 5.18) shall not permit any of its
Subsidiaries to, directly or indirectly:
(a) INDEBTEDNESS TO EBITDA. Permit the ratio of (i) total
Indebtedness of Lessee and its Subsidiaries on a consolidated basis at any date
minus cash and cash equivalents then held by Lessee and its Subsidiaries to the
extent that such cash and cash equivalents are in excess of $50,000,000, to (ii)
EBITDA of Lessee and its Subsidiaries on a consolidated basis for the period of
four consecutive fiscal quarters most recently ended prior to such date for
which Lessee has delivered the financial statements contemplated by SECTION
5.10.(a) or (b), as the case may be, to be greater than 3:00 to 1:00.
(b) INTEREST COVERAGE. Permit, for any period of four consecutive
fiscal quarters most recently ended, the ratio of (i) EBITDA of Lessee and its
Subsidiaries on a consolidated basis for such period to (ii) the amount of
interest expense, both expensed and capitalized, of Lessee and its Subsidiaries,
determined on a consolidated basis in accordance with GAAP, for such period on
the aggregate principal amount of their consolidated Indebtedness, to be less
than 3.00 to 1.00.
5.19 LIMITATION ON TRANSACTIONS WITH AFFILIATES. None of the Lessee or any
of its Subsidiaries shall enter into any transaction, including any purchase,
sale, lease or exchange of property or the rendering of any service, with any
Affiliate unless such transaction is (a) otherwise permitted under this
Agreement, (b) in the ordinary course of the Lessee's or such Subsidiary's
business and (c) upon fair and reasonable terms no less favorable to the Lessee
or such Subsidiary, as the case may be, than it would obtain in a hypothetical
comparable arm's-length transaction with a Person which is not an Affiliate (it
being understood (i) that such fairness and reasonableness shall, in the case of
arrangements with joint ventures with unaffiliated third parties, be determined
in the context of all arrangements between the Lessee and its Subsidiaries, on
the one hand, and such joint venture, on the other hand and (ii) this SUBSECTION
5.19 shall not prohibit the transaction with Onfield Apparel Group LLC described
on Schedule V to the Revolving Credit Agreement.
ARTICLE VI
OTHER COVENANTS AND AGREEMENTS
6.1 COOPERATION WITH LESSEE. Administrative Agent and each Participant
shall, to the extent reasonably requested by Lessee (but without assuming
additional liability on account thereof), at Lessee's expense, cooperate to
allow Lessee to (a) perform its covenants contained in SECTION 5.1, including at
any time and from time to time, upon the reasonable request of Lessee,
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to promptly and duly execute and deliver any and all such further instruments,
documents and completed financing statements (and continuation statements
related thereto) as Lessee may request in order to perform such covenants, (b)
further Lessee's requirements as lessee of the Property, including to file or
cause to be filed any completed statement with respect to any tax abatements or
other requirements, (c) execute and acknowledge consents or joinders and
otherwise assist with respect to actions permitted under Section 8.3 of the
Lease, including such actions as Lessee may request on the Acquisition Date
(such as executing reciprocal easement agreements and executing documents
described in Section 8.3 of the Lease which require Lessor's signature), and (d)
upon transfer of the Property to Lessee or any third party, minimize transfer
and mortgage recording taxes as long as by doing so no Administrative Agent or
Participant shall have any continuing liability with respect thereto.
6.2 COVENANTS OF LESSOR.
(a) DISCHARGE OF LIENS. Lessor covenants that it 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 attributable to it. Notwithstanding the foregoing,
the Lessor shall not be required to so discharge any such Lessor Lien while the
same is subject to a Permitted Contest; PROVIDED, HOWEVER, that the Lessor shall
discharge any such Lessor Lien attributable to it, whether or not subject to a
Permitted Contest as provided above, upon the purchase of the applicable
Property by Lessee pursuant to the Lease.
(b) CHANGE OF PRINCIPAL PLACE OF BUSINESS. Lessor shall give prompt
notice to Administrative Agent, if Lessor's principal place of business or chief
executive office, or the office where the records concerning the accounts or
contract rights relating to the Property or the Overall Transaction are kept,
shall cease to be located at 1 Madison Avenue, 2nd Floor, New York, New York
10010 or if it shall change its name, identity, jurisdiction of organization or
state organization number.
(c) [RESERVED]
(d) LOAN AGREEMENT. Lessor hereby agrees that, so long as the Lease
is in effect, Lessor shall not consent to or permit any amendment of the terms
and provisions of the Loan Agreement, the Mortgage or any Note whether or not
any Lease Event of Default shall have occurred and be continuing, in each case
without the prior written consent of the Lessee, except that without such
consent, (i) Lessor may waive performance by Administrative Agent of obligations
to Lessor the non-performance of which does not adversely affect Lessee and (ii)
Lessor may consent to or permit amendment of the terms and provisions of the
Loan Agreement, the Mortgage or any Note for the purpose of curing any
ambiguity, inconsistency or omission, or of curing, correcting or supplementing
any defective provision contained therein, or in regard to matters or questions
arising thereunder, as the parties thereto may deem necessary or desirable and
not inconsistent with this Agreement and which shall not adversely affect
Lessee.
(e) TAX ATTRIBUTES. Prior to the Termination Date, no Participant
shall claim any federal or state tax attributes or benefits (including
depreciation) relating to either Property unless required to do so by an
appropriate taxing authority or after a clearly applicable change in Applicable
Law or as a protective response to a proposed adjustment by an Authority;
PROVIDED,
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HOWEVER, that if an appropriate taxing authority shall require any Participant
to claim any such federal or state tax attributes or benefits, such Person shall
promptly notify Lessee thereof and shall permit the Lessee to contest such
requirement in a manner similar to the contest rights provided in, and subject
to any applicable limitation to a contest contained in, SECTION 7.2(b).
(f) MAINTENANCE OF RECORD TITLE. Lessor hereby agrees to maintain
record title to the Property and not transfer same to Persons other than
Affiliates of Lessor, except as contemplated in the Operative Documents or in
connection with the exercise of remedies under the Lease upon the occurrence of
an Event of Default.
6.3 RESTRICTIONS ON AND EFFECT OF TRANSFER. No Lender shall assign,
convey or otherwise transfer (including pursuant to a participation) all or any
portion of its right, title or interest in, to or under any of the Operative
Documents except that (i) without the prior written consent of Administrative
Agent or the Lessee or any other Person (x) any Lender may pledge or assign all
or any portion of its interest to any Federal Reserve Bank in accordance with
applicable law, (y) any Lender may transfer all or any portion of its interest
to any of its Affiliates or to any other existing Participant and (z) any Lender
may enter into a participation with a Loan Participant pursuant to SECTION 6.4;
and (ii) with the prior written consent of Administrative Agent, which shall not
be unreasonably withheld, and, provided a Lease Event of Default does not exist,
the Lessee (which consent shall not be unreasonably withheld), any Lender may
transfer any or all of such right, title and interest upon the satisfaction of
each of the following conditions:
(a) REQUIRED NOTICE AND DOCUMENTATION DATE. Any Lender desiring to
effect a transfer of its interest shall give written notice of each such
proposed transfer to the Lessee and Administrative Agent at least ten (10) days
prior to such proposed transfer (other than with respect to transfers of a
Lender's interest on the Documentation Date, notice of which may be given on the
Documentation Date), setting forth the name of such proposed transferee, the
percentage or interest to be retained by such Lender, if any, and the date on
which such transfer is proposed to become effective. All reasonable
out-of-pocket costs incurred by Administrative Agent in connection with any such
disposition by a Lender under this SECTION 6.3 shall be borne by such Lender. In
the event of a transfer under this SECTION 6.3, any expenses incurred by the
transferee in connection with its review of the Operative Documents and its
investigation of the transactions contemplated thereby shall be borne by such
transferee or the relevant Lender, as they may determine, but shall not be
considered costs and expenses which the Lessee is obligated to pay or reimburse
under SECTION 8.9. The applicable Lender or transferee shall pay to
Administrative Agent for each transfer a fee of $3,500.
(b) ASSUMPTION OF OBLIGATIONS. Any transferee pursuant to this
SECTION 6.3 shall have executed and delivered to Administrative Agent and Lessor
a letter in substantially the form of the Investor's Letter attached hereto as
EXHIBIT I (the "INVESTOR'S LETTER"), and thereupon the obligations of the
transferring Lender under the Operative Documents shall be proportionately
released and reduced to the extent of such transfer. Upon any such transfer as
above provided, the transferee shall be deemed to be bound by all obligations
(whether or not yet accrued) under, and to have become a party to, all Operative
Documents to which its transferor was a party, shall be deemed the pertinent
"Lender" for all purposes of the Operative Documents and shall be deemed to have
made that portion of the payments pursuant to this Agreement
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previously made or deemed to have been made by the transferor represented by the
interest being conveyed; and each reference herein and in the other Operative
Documents to the pertinent "Lender" shall thereafter be deemed a reference to
the transferee, to the extent of such transfer, for all purposes. Upon any
transfer pursuant to this SECTION 6.3, Administrative Agent shall deliver to
Lessor and Lessee a copy of the Investor's Letter. The information contained
therein shall be deemed to reflect the relevant information for such new Lender
and the Commitment of such new Lender (and the revised Commitment of the
transferor Lender if it shall not have transferred its entire interest).
Notwithstanding any transfer as provided in this SECTION 6.3, the transferor
shall be entitled to all benefits accrued and all rights vested prior to such
transfer, including rights to indemnification under this Agreement or any other
Operative Document.
(c) REPRESENTATIONS AND WARRANTIES. Notwithstanding anything to the
contrary set forth above, no Lender may assign, convey or transfer its interest
to any Person, unless such Person shall have delivered to Administrative Agent,
Lessor and the Lessee a certificate confirming the accuracy of the
representations and warranties set forth in SECTION 4.2(b) with respect to such
Person (other than as such representation or warranty relates to the execution
and delivery of Operative Documents).
(d) AMOUNTS. Any transfer of Notes shall be in a face principal
amount which is equal to or greater than $5,000,000 and an integral multiple of
$1,000,000, or the entire amount of the Note.
6.4 COVENANTS AND AGREEMENTS OF LENDERS.
(a) PARTICIPATIONS. Each Lender covenants and agrees that it will
not grant participations in its Notes to any Person (a "LOAN PARTICIPANT")
unless such Person (i) is a bank or other financial institution (PROVIDED that
any foreign transferee must comply with SECTION 7.3) and (ii) represents and
warrants, in writing, to such Lender for the benefit of the Lenders, Lessor and
Lessee as set forth in SECTION 4.2(b). Any such Person shall require any
transferee of its interest in the Notes to make the representations and
warranties set forth in the preceding sentence, in writing, to such Person for
its benefit and the benefit of the Participants and Lessee. In the event of any
such sale by a Lender of a participating interest to a Loan Participant, such
Lender's obligations under this Agreement and under the other Operative
Documents shall remain unchanged, such Lender shall remain solely responsible
for the performance thereof, such Lender shall remain the holder of its Note for
all purposes under this Agreement and under the other Operative Documents, and
Lessor, Administrative Agent and, except as set forth in SECTION 6.4(b), Lessee
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement and under the other
Operative Documents. In the case of any such participation, each Loan
Participant shall be deemed to have the right of set-off in respect of its
participation to the same extent as if the amount of its participation were
owing directly to a Lender under the Operative Documents. In the event of any
such sale by a Lender of a participatory interest to a Loan Participant, the
selling Lender shall not grant any such Loan Participant any voting rights or
veto power over any action by the selling Lender under this Agreement or any
other Operative Document, except that the selling Lender may agree not to take
any action which would require the consent of such selling Lender under SECTION
8.5 without the consent of such Loan Participant.
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(b) TRANSFEREE INDEMNITIES. Each purchasing Participant and Loan
Participant shall be entitled to the benefits of Sections 2.11 and 2.12 of the
Loan Agreement with respect to its Notes or participation in the Loans
outstanding from time to time; PROVIDED, that no Loan Participant shall be
entitled to receive any greater amount pursuant to such Sections than the
transferor Lender would have been entitled to receive in respect of the amount
of the Notes or participation transferred by such transferor Lender to such Loan
Participant had no such transfer or participation occurred.
(c) PREPAYMENT BY LESSOR OF NOTES. Except as expressly permitted by
the Operative Documents, Lessor shall not voluntarily prepay the Notes, or any
part thereof, without the written consent of the Lessee; PROVIDED, HOWEVER, that
Lessor shall prepay all or any portion of the Notes at any time upon written
instructions from Lessee and receipt of Supplemental Rent equal to the amount of
the prepayment.
(d) NON-INTERFERENCE. The Lenders and Administrative Agent each
covenant that it will not take or cause to be taken any affirmative act that
interferes in Lessee's use of the Property in accordance with the Lease during
the Lease Term, so long as no Lease Event of Default has occurred and is
continuing; it being agreed that Lessee's remedies for breach of the foregoing
covenant shall be limited to a claim for damages or the commencement of
proceedings to enjoin such breach. Such right is independent of, and shall not
affect, Lessor's rights otherwise to initiate legal action to enforce the
obligations of Lessee under the Lease.
6.5 FUTURE LENDERS. Each Lender, by its acceptance of its Note or Notes,
shall be deemed to be bound by and, upon compliance with the requirements of
SECTION 6.3 or 6.4, as applicable, will be entitled to all of the benefits of
the provisions of, this Agreement.
6.6 ADMINISTRATIVE AGENT UNDER PARTICIPATION AGREEMENT AND MORTGAGE. For
purposes of this Agreement and the Mortgage, the parties hereto agree that
Administrative Agent shall be the administrative agent of the Lenders and the
Lessor, with Administrative Agent's duties and obligations hereunder being
subject to the limitations, and Administrative Agent being entitled to the
rights, set forth in Article VII of the Loan Agreement.
ARTICLE VII
INDEMNIFICATION
7.1 GENERAL INDEMNIFICATION. Lessee agrees, whether or not any of the
transactions contemplated hereby shall be consummated, to assume liability for,
and to indemnify, protect, defend, save and keep harmless each Indemnitee (on an
after-tax basis in accordance with SECTION 7.5) from and against any and all
Claims that may be imposed on, incurred by or asserted against such Indemnitee
(including Claims arising out of such Indemnitee's negligence), whether or not
such Indemnitee shall also be indemnified as to any such Claim by any other
Person and whether or not such Claim arises or accrues prior to the initial
Advance Date, during the Lease Term or after the Termination Date, in any way
relating to or arising out of (a) any of the Original Operative Documents or the
Operative Documents or any of the transactions contemplated thereby or any
investigation, litigation or proceeding in connection therewith, and any
amendment, modification or waiver in respect thereof; (b) the Property or any
part thereof or interest therein; (c) the acquisition, mortgaging, design,
construction, preparation, installation,
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inspection, delivery, non-delivery, acceptance, rejection, purchase, ownership,
possession, occupancy, rental, lease, sublease (including the Additional
Property Sublease and the acts or omissions of the lessee thereunder),
repossession, maintenance, repair, alteration, modification, addition or
substitution, storage, transfer or title, redelivery, use, financing,
refinancing, operation, condition, sale (including any sale pursuant to Section
6.3 of the Lease or any sale pursuant to Article XVIII of the Lease), return or
other disposition of all or any part of the Property or any interest therein or
the imposition of any Lien (or incurrence of any liability to refund or pay over
any amount as a result of any Lien) thereon, including: (i) Claims or penalties
arising from any violation of law, including Applicable Law, or in tort (strict
liability or otherwise), (ii) loss of or damage to the environment (including
investigation costs, clean-up costs, response costs, remediation and removal
costs, costs of corrective action, costs of financial assurance, and all other
damages, costs, fees and expenses, fines and penalties, including natural
resource damages), or death or injury to any Person, and all expenses associated
with the protection of wildlife, aquatic species, vegetation, flora and fauna,
and any mitigative action required by or under Environmental Laws, (iii) latent
or other defects, whether or not discoverable by Lessee or any Indemnitee, (iv)
any Claims resulting from the existence or Release of any Hazardous Materials
at, under, above or from the Property and (v) any Claim for patent, trademark,
tradename or copyright infringement; (d) the offer, issuance, sale or delivery
of the Notes; (e) the breach by Lessee of any representation or warranty made by
it or deemed made by it in any Original Operative Documents or Operative
Document; (f) the transactions contemplated hereby or by any other Original
Operative Documents or Operative Document, in respect of the application of
Parts 4 and 5 of Subtitle B of Title I of ERISA and any prohibited transaction
described in Section 4975(c) of the Code; (g) any other agreement entered into
or assumed by Lessee in connection with either Property (including, in each
case, matters based on or arising from the negligence of any Indemnitee); (h)
the imposition of any Lien on either Property other than Lessor Liens; (i)
enforcing the Operative Documents or exercising remedies thereunder; (j) any
violation of any Applicable Law by Lessee or its directors, officers, employees,
administrative agents or servants; or (k) any amount for which an
indemnification payment would be payable to any of the Agents under Section 7.7
of the Loan Agreement.
Lessee shall not be required to indemnify under this SECTION 7.1 for (1) as
to an Indemnitee, any Claim to the extent resulting from the willful misconduct
or gross negligence of such Indemnitee (other than any gross negligence or
willful misconduct imputed as a matter of law to such Indemnitee solely by
reason of its participation in the Overall Transaction and entering into the
Operative Documents, its interest in either Property or the acts or omissions of
the Lessee), (2) as to any Indemnitee, any Claim for bodily injury or property
damage to the extent resulting from the negligence or willful misconduct of such
Indemnitee where such negligence or willful misconduct occurs on either
Property; (3) any Claims in respect of Taxes (such Claims to be subject to
SECTION 7.2), other than a payment necessary and sufficient to cover any Taxes
which may be imposed as a result of such indemnity payment under this SECTION
7.1 on an after-tax basis, PROVIDED, that this CLAUSE (3) does not apply to any
taxes or penalties included in Claims against which the Indemnitee is provided
an indemnification under CLAUSE (f) of this SECTION 7.1, (4) as to an
Indemnitee, any Claim resulting from Lessor Liens which such Indemnitee is
responsible for discharging under the Operative Documents, (5) voluntary
transfers by Lessor of either Property, except for transfers of either Property
required by the Lessee or arising as a result of the exercise of remedies under
the Lease; and (6) as to any Indemnitee, any Claim arising from legal
proceedings commenced against such Indemnitee by any Loan
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Participant (other than legal proceedings arising from or relating to any act or
omission of Lessee or Guarantor). In the event that the indemnification provided
for herein is prohibited by Applicable Law, Lessee will contribute to a Claim to
the maximum extent permitted by law, and indemnification by Lessee for events
which occur during the term of the Lease or while Lessee is in possession of
either Property will not be affected by a termination of the Lease.
7.2 GENERAL TAX INDEMNITY.
(a) TAX INDEMNITY. Lessee shall indemnify and hold each Indemnitee
harmless (on an after-tax basis in accordance with SECTION 7.5) from and
against, any and all Taxes, howsoever imposed, on or with respect to any
Indemnitee, the Property or any portion thereof, any Original Operative
Document, any Operative Document or Lessee or any sublessee or user of the
Property by any Authority in connection with or in any way relating to (i) the
acquisition, mortgaging, design, construction, preparation, installation,
inspection, delivery, non-delivery, acceptance, rejection, purchase, ownership,
possession, rental, lease, sublease, repossession, maintenance, repair,
alteration, modification, addition or substitution, storage, transfer of title,
redelivery, use, financing, refinancing, operation, condition, sale, return or
other application or disposition of all or any part of the Properties or the
imposition of any Lien (or incurrence of any liability to refund or pay over any
amount as a result of any Lien) thereon, (ii) Basic Rent or Supplemental Rent or
the receipts or earnings arising from or received with respect to the Property
or any part thereof, or any interest therein or any applications or dispositions
thereof, (iii) any other amount paid or payable pursuant to the Notes or any
other Operative Documents, (iv) the Property or any part thereof or any interest
therein, (v) all or any of the Operative Documents, any other documents
contemplated thereby and any amendments and supplements thereto, and (vi)
otherwise with respect to or in connection with the transactions contemplated by
the Operative Documents; PROVIDED, HOWEVER, that the indemnification obligation
of this SECTION 7.2(a) shall not apply to Taxes (i) based upon or measured by
the Indemnitee's net income; (ii) characterized under local law as franchise,
net worth, or shareholder's capital (excluding, however, any value-added,
license, property or similar Taxes); (iii) Taxes based upon the voluntary
transfer, assignment or disposition by Administrative Agent, Lessor or any
Participant of any interest in the Property (other than a transfer pursuant to
the exercise of remedies under the Operative Documents, transfers pursuant to
the exercise of the Remarketing Option or Purchase Option, a transfer to Lessee
or otherwise pursuant to the Lease); (iv) which are Federal net income taxes
(except to the extent covered to make payments, where required, on an after-tax
basis) as well as amounts withheld from any payment to any Indemnitee that is
not a United States Person as defined in Section 7701(a)(30) of the Code which
has not complied with SECTION 7.3 (other than any such Indemnitee that has
complied with SECTION 7.3 on or before the first Payment Date that it has become
a "Lender" but that is subsequently rendered unable to comply with SECTION 7.3
by reason of a circumstance described in Section 2.11(a) of the Loan Agreement);
(v) imposed by state and local governments as net income Taxes, except
incremental Taxes imposed on the Lessor by the Commonwealth of Massachusetts; or
(vi) attributable to any Lessor Lien or the gross negligence or willful
misconduct of the Indemnitee. Notwithstanding the proviso of the preceding
sentence, Lessee shall pay or reimburse, and indemnify and hold harmless, any
Indemnitee which is not a United States Person as defined in Section 7701 (a)
(30) of the Code, and which has complied with SECTION 7.3 or any Indemnitee that
is a Lender that has complied with SECTION 7.3 on or before the first Payment
Date that it becomes a "Lender" but which is subsequently rendered unable to
comply with SECTION 7.3 by
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reason of a circumstance described in Section 2.11(a) of the Loan Agreement,
from any deduction or withholding of any United States Federal, state or local
income tax. All indemnities contained in this SECTION 7.2(a) are expressly made
for the benefit of, and shall be enforceable by, each Indemnitee.
(b) CONTESTS. Lessee shall pay at the time and in the manner set
out in SECTION 7.2(c) any Taxes subject to indemnification pursuant to SECTION
7.2 (a); PROVIDED, HOWEVER, that Lessee shall be under no obligation to pay any
such Tax so long as the payment of such Tax is not delinquent or is being
contested by a Permitted Contest. If any claim is made against any Indemnitee
solely for any Tax which is subject to indemnification as provided in SECTION
7.2(a), Indemnitee shall as soon as practicable, but in no event more than 20
days after receipt of written notice, notify the Lessee and if, in the
reasonable opinion of tax counsel to the Indemnitee in the case of any Tax that
may reasonably be expected to exceed $5,000,000 in the aggregate, there exists a
basis to contest such Tax which satisfies the requirements of ABA Formal Opinion
85-352 (and if the PROVISOS of the definition of "Permitted Contest" continue to
be satisfied and so long as no Event of Default exists), the Lessee at its
expense may, to the extent permitted by Applicable Law, contest such Tax;
PROVIDED that in, all other circumstances, upon notice from the Lessee to such
Indemnitee that there exists a basis to contest any such Tax which satisfies the
requirements of ABA Formal Opinion 85-352 (as supported by an opinion of tax
counsel to the Indemnitee), the Indemnitee, at the Lessee's expense, shall
contest any such Tax. The Lessee shall pay all expenses incurred by the
Indemnitee in contesting any such Tax (including all reasonable attorneys' and
accountants' fees), upon written demand by the Indemnitee. The Indemnitee shall
have the right to participate in the conduct of any proceedings controlled by
the Lessee and the Indemnitee shall in all events be kept informed of material
developments relative to such proceedings. The Lessee shall have the right to
participate in the conduct of any proceedings controlled by the Indemnitee to
the extent that such participation by such Person does not interfere with the
Indemnitee's control of such contest and the Lessee shall in all events be kept
informed, to the extent practicable, of material developments relative to such
proceedings. The Indemnitees agree that a contested claim will not be settled or
compromised without the Lessee's prior written consent (which consent shall
neither be unreasonably delayed nor withheld), unless the PROVISOS of the
definition of "Permitted Contest" would not continue to be satisfied. Each
Indemnitee shall endeavor to settle or compromise any such contested claim in
accordance with written instructions from the Lessee. The failure of an
Indemnitee to timely contest a claim against it for any Tax for which it has an
obligation to contest under this SECTION 7.2(b) shall relieve the Lessee of its
obligations to such Indemnitee under SECTION 7.2(a) only to the extent such
failure results in the loss of an effective contest. If Applicable Law requires
the payment of a contested Tax as a condition to its being contested, and the
Lessee chooses to contest such Tax or to direct the Indemnitee to contest such
Tax, then the Lessee shall provide the Indemnitee with the funds to pay such
Tax, as a non-interest bearing loan by the Lessee to the Indemnitee to be repaid
by any recovery of such Tax and any remaining unpaid amount to reduce the
obligations to indemnify for such Tax. Lessee shall indemnify the Indemnitee on
a grossed-up basis (in accordance with SECTION 7.5) for and against any adverse
tax consequences of such interest-free loan. In the event that the Indemnitee
receives a refund (or other like adjustment) in respect of any Tax for which the
Indemnitee has been reimbursed by Lessee, the Indemnitee shall immediately remit
the amount of such refund to Lessee, net of all costs and expenses incurred by
such Indemnitee, together with any interest actually received thereon.
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(c) PAYMENTS. Any Tax indemnifiable under SECTION 7.2(a) shall be
paid directly when due to the applicable taxing authority if direct payment is
practicable and permitted. If direct payment to the applicable taxing authority
is not permitted or is otherwise not made, any amount payable to an Indemnitee
pursuant to SECTION 7.2(a) shall be paid within thirty (30) days after receipt
of a written demand therefor from such Indemnitee accompanied by a written
statement describing in reasonable detail the amount so payable, but not before
the date that the relevant Taxes are due. Any payments made pursuant to SECTION
7.2(a) directly to the Indemnitee entitled thereto or the Lessee, as the case
may be, shall be made in immediately available funds at such bank or to such
account as specified by the payee in written directions to the payor, or, if no
such direction shall have been given, by check of the payor payable to the order
of the payee by certified mail, postage prepaid at its address as set forth in
this Participation Agreement. Upon the request of any Indemnitee with respect to
a Tax that Lessee is required to pay, Lessee shall furnish to such Indemnitee
the original or a certified cop of a receipt for Lessee's payment of such Tax or
such other evidence of payment as is reasonably acceptable to such Indemnitee.
(d) REPORTS. If any report, return or statement is required to be
filed with respect to any Taxes that are subject to indemnification under
SECTION 7.2(a), the Lessee shall, if Lessee is permitted by Applicable Law,
timely prepare and file such report, return or statement; PROVIDED, HOWEVER,
that if Lessee is not permitted by Applicable Law to file any such report,
Lessee will promptly so notify the appropriate Indemnitee, in which case the
Indemnitee will file any such report after preparation thereof by Lessee. Lessee
will deliver any such return, together with immediately available funds for
payment of any Tax due, to such Indemnitee at least five (5) days in advance of
the date such return or payment is due.
7.3 WITHHOLDING TAX EXEMPTION.
(a) Each Lender that is not a United States Person (within the
meaning of Section 7701 (a) (30) of the Code) for federal income tax purposes
(i) represents to Lessee, Lessor and Administrative Agent that under applicable
law and treaties in effect on the date hereof or on the date it becomes a Lender
pursuant to SECTION 6.3, as the case may be, no taxes are required to be
withheld with respect to any payments to be made to such Lender under the
Operative Documents, (ii) agrees to furnish to Lessee, Lessor and Administrative
Agent, on or before the first Payment Date occurring after it has become a
"Lender" two valid, duly completed original copies of United States Internal
Revenue Service Form W-8BEN or W-8ECI or successor applicable form, properly and
duly executed, certifying in either case that such Lender is entitled to receive
payments pursuant to the Operative Documents without deduction or withholding of
any United States federal income taxes and is a foreign person thereby entitled
to an exemption from United States backup withholding taxes, and any such
additional form (or any successor form or forms required) upon the expiration or
obsolescence of any previously delivered form, (iii) agrees to comply from time
to time with all applicable United States laws and regulations with regard to
withholding tax exemptions, and (iv) agrees to obtain such extensions of time
for filing and completing such forms or certifications as may reasonably be
requested by Lessee or Administrative Agent.
(b) Notwithstanding any provision herein to the contrary, but
without limiting Lessee's obligations UNDER SECTION 7.2(a) hereof by reason of a
circumstance described in
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Participation Agreement
Section 2.11(a) of the Loan Agreement, Lessee shall have no obligation to
gross-up any payment for withholding taxes or pay any amount hereunder to or for
the account of any Lender that fails to comply with its obligations pursuant to
SECTION 7.3(a) (for this purpose, a failure by a Lender to comply with such
obligations shall include, without limitation, any representation or warranty
made or deemed to have been made by such Lender pursuant to SECTION 7.3(a)
proving to have been incorrect, false or misleading in any material respect when
so made or deemed to be made).
7.4 EXCESSIVE USE INDEMNITY. In the event that at the end of the Lease
Term: (a) Lessee elects the Remarketing Option; and (b) after paying to Lessor
all amounts due under Sections 6.2 and 6.3 of the Lease, including Proceeds and
the aggregate Guaranteed Residual Amount, Lessor does not have sufficient funds
to reduce the Lease Balance to zero, then Lessee shall promptly pay over to
Lessor the shortfall unless Lessee delivers a report from an independent
appraiser in form and substance satisfactory to the Required Entities which
establishes that the decline in value in a Property from the aggregate amount
anticipated for such date in the Appraiser's report delivered with respect to
such Property on or about the Documentation Date or the Acquisition Date as
required herein was not due to the excessive use of such Property, failure to
maintain such Property, modifications or restorations which reduce the value of
the such Property, any adverse change in the environmental condition of such
Property, any easements granted pursuant to Section 8.3 of the Lease or Section
3.4 of the Construction Agency Agreement which reduce the value of such
Property, or any defect or exception to title of such Property or any other
cause or condition within the power of Lessee to control or affect differing
from ordinary wear and tear.
7.5 GROSS UP. If an Indemnitee shall not be entitled to a corresponding
and equal deduction with respect to any payment or Tax which Lessee is required
to pay or reimburse under any other provision of this ARTICLE VII (each such
payment or reimbursement under this ARTICLE VII, an "original payment") and
which original payment constitutes income to such Indemnitee, then Lessee shall
pay to such Indemnitee on demand the amount of such original payment on a
grossed-up basis such that, after subtracting all Taxes imposed on such
Indemnitee with respect to such original payment by Lessee (including any Taxes
otherwise excluded by SECTION 7.2(b) and assuming for this purpose that such
Indemnitee was subject to taxation at the highest Federal marginal rates
applicable to widely held corporations for the year in which such income is
taxable and at an assumed state and local income tax rate of 8.5%), such
payments shall be equal to the original payment to be received or paid;
PROVIDED, HOWEVER, that Lessee shall not be required to make any grossed-up
payment to any Indemnitee that is not organized under the laws of the United
States or a state thereof if such Indemnitee fails to comply with the
requirements of SECTION 7.3.
ARTICLE VIII
MISCELLANEOUS
8.1 SURVIVAL OF AGREEMENTS. The representations, warranties, covenants,
indemnities and agreements of the parties provided for in the Operative
Documents, and the parties' obligations under any and all thereof, shall survive
the execution and delivery and the termination or expiration of this Agreement
and any of the Operative Documents, including the termination of the Lease with
respect to the Property, the transfer of the interest in the Property by Lessee
as provided in any other Operative Document, any disposition of any interest of
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Lessor in the Property, the purchase and sale of the Notes, payment therefor and
any disposition thereof and shall be and continue in effect notwithstanding any
investigation made by any party hereto or to any of the either Operative
Documents and the fact that any such party may waive compliance with any of the
other terms, provisions or conditions of any of the Operative Documents.
8.2 NO BROKER, ETC. Except for the Arranger (the fees and expenses of
which shall be payable by the Lessee in accordance with the provisions of the
Operative Documents), each of the parties hereto represents to the others that
it has not retained or employed any broker, finder or financial advisor 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, nor has it incurred any fees or commissions to which Lessor might be
subjected by virtue of their entering into the transactions contemplated by this
Agreement. 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.
8.3 NOTICES. Unless otherwise specified herein, all notices, requests,
demands or other communications to or upon the respective parties hereto shall
be made in writing and shall be deemed to have been given (i) in the case of
notice by letter, the earlier of when delivered to the addressee by hand or
courier if delivered on a Business Day and, if not delivered on a Business Day,
the first Business Day thereafter or on the third Business Day after, depositing
the same in the mails, registered or certified mail, postage prepaid, return
receipt requested, addressed as provided on SCHEDULE III hereto, and (ii) in the
case of notice by facsimile or bank wire, when receipt is confirmed if delivered
on a Business Day, and, if not delivered on a Business Day, the first Business
Day thereafter, addressed as provided on SCHEDULE III hereto, or to such other
address as any of the parties hereto may designate by written notice. Copies of
all notices given by facsimile or bank wire shall be contemporaneously sent by
overnight courier.
8.4 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 agreement.
8.5 AMENDMENTS. Except as otherwise specifically provided in any
Operative Document, neither this Agreement nor any of the other Operative
Documents nor any of the terms hereof or thereof may be terminated, amended,
supplemented, waived or modified orally, but only by an instrument in writing
signed by the party against which the enforcement of the termination, amendment,
supplement, waiver or modification shall be sought; and no such termination,
amendment, supplement, waiver or modification shall be effective unless a signed
copy thereof shall have been delivered to Lessor, the Lessee and Administrative
Agent. Lessor and Lessee shall not be permitted to amend, modify, supplement or
waive any provision of the Lease or other Operative Document without the written
consent of the Required Entities or (after the Loans shall have been paid in
full, or with respect to Excluded Amounts) the Lessor, as applicable; PROVIDED,
that without the prior written consent of all of the Participants, Lessor shall
not:
(a) modify any of the provisions of this SECTION 8.5, change the
definition of "Required Entities", "Applicable Margin", "Event of Loss" or
"Guaranteed Residual Amount" or
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Participation Agreement
modify or waive any provision of any Operative Document requiring action by any
of the foregoing;
(b) reduce the amount or change the time of payment of any amount
of principal owing or payable under any Note, of interest or Yield owing or
payable on any Note or on the Investment Balance, respectively, or of the
Commitment Fee, modify any of the provisions of Article III of the Loan
Agreement or increase any of the Commitments;
(c) modify, amend, waive or supplement any of the provisions of
Articles II, V, VI, VII, IX, X, XI, XIII, XVI, XVII and XVIII of the Lease or
Sections 5.2, 5.17 and 5.18;
(d) reduce, modify, amend or waive any indemnities in favor of any
Participant;
(e) reduce the amount or change the time of payment of Basic Rent
or the Lease Balance;
(f) consent to any assignment of the Lease releasing Lessee from
its obligations to pay Rent or the Lease Balance or changing the absolute and
unconditional character of such obligations;
(g) release all or substantially all of the Collateral (except as
otherwise specifically provided in any Operative Document); or
(h) release the Guaranty;
PROVIDED, that no amendment, modification, supplement or waiver of any Operative
Document that affects adversely the interests, rights or obligations of
Administrative Agent QUA Administrative Agent shall be made without the consent
of Administrative Agent.
8.6 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.
8.7 PARTIES IN INTEREST. Except as expressly provided herein, none of the
provisions of this Agreement is intended for the benefit of any Person except
the parties hereto, their successors and permitted assigns.
8.8 GOVERNING LAW. THIS AGREEMENT HAS BEEN DELIVERED IN ACCORDANCE WITH,
AND SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICTS OF LAWS
PRINCIPLES OF SUCH STATE, EXCEPT SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW.
8.9 PAYMENT OF TRANSACTION COSTS AND OTHER COSTS.
(a) TRANSACTION COSTS. If the transactions contemplated by this
Agreement are consummated, as and when any portion of Transaction Costs becomes
due and payable, Lessee
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shall promptly (and in any event, on or prior to the next Advance Date) pay such
costs directly or furnish Lessor funds sufficient to, and Lessor shall promptly
make payment of such portion to the Person or Persons entitled to payment upon
presentation to Lessor of bills or invoices for the amount of such payment. If
such transactions are not so consummated, Lessee promptly shall pay the
Transaction Costs.
(b) CONTINUING EXPENSES. Subject to Lessee's approval prior to
incurrence (not to be unreasonably withheld) unless a Default or Event of
Default exists, the continuing fees, expenses and disbursements (including
reasonable counsel fees and expenses) of Lessor, and the expenses of
Administrative Agent, shall be paid by Lessee as Supplemental Rent.
(c) AMENDMENTS, SUPPLEMENTS AND APPRAISAL. Without limitation of
the foregoing, Lessee agrees to pay to the Lessor, Administrative Agent: (i) all
costs and expenses (including reasonable legal fees and expenses) incurred by
the Administrative Agent and the Lessor in connection with the considering,
evaluating, investigating, negotiating and entering into or giving or
withholding of any amendments or supplements or waivers or consents with respect
to any Operative Document; (ii) all reasonable costs and expenses (including
legal fees and expenses) incurred by the Administrative Agent, the Lessor and
the Lenders in connection with termination of the Lease or any other Operative
Document; (iii) all reasonable costs and expenses (including legal fees and
expenses) incurred by the Administrative Agent, the Lessor and the Lenders in
connection with the negotiation and documentation of any restructuring or
"workout," whether or not consummated, of any Operative Document; (iv) all costs
and expenses (including legal fees and expenses) incurred by any of them in
connection with the enforcement of the rights or remedies under the Operative
Documents; or (v) all costs and expenses (including reasonable fees and
expenses) incurred by the Administrative Agent and the Lessor in connection with
any Advance Date or the Acquisition Date.
8.10 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.
8.11 LIMITED LIABILITY OF LESSOR. The parties hereto agree that Lessor
shall have no personal liability whatsoever to the Lessee, the Lenders, the
Administrative Agent or any of their respective successors and assigns for any
Claim based on or in respect of this Agreement or any of the other Operative
Documents or arising in any way from the transactions contemplated hereby or
thereby; PROVIDED, HOWEVER, that Lessor shall be liable: (a) for its own willful
misconduct or gross negligence (or negligence in the handling of funds), (b) for
liabilities that may result from the incorrectness of any representation or
warranty expressly made by it in SECTION 4.2(a), or (c) for any Tax based on or
measured by any fees, commission or compensation received by it for actions
contemplated by the Operative Documents. It is understood and agreed that,
except as provided in the preceding proviso: (i) Lessor shall have no personal
liability under any of the Operative Documents as a result of acting pursuant to
and consistent with any of the Operative Documents; (ii) all obligations of
Lessor to the Lessee, the Lenders, the Administrative Agent or any of their
respective successors and assigns are solely nonrecourse obligations (with
liability payable solely out of the Collateral) except to the extent
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that it has received payment from others; (iii) all such personal liability of
Lessor is expressly waived and released as a condition of, and as consideration
for, the execution and delivery of the Operative Documents by Lessor.
8.12 LIABILITIES OF THE PARTICIPANTS. No Participant shall have any
obligation to any other Participant or to Lessee or Administrative Agent with
respect to the transactions contemplated by the Operative Documents except those
obligations of such Participant expressly set forth in the Operative Documents
or except as set forth in the instruments delivered in connection therewith, and
no Participant shall be liable for performance by any other party hereto of such
other party's obligations under the Operative Documents except as otherwise so
set forth.
8.13 LIABILITIES OF ADMINISTRATIVE AGENT. Administrative Agent shall not
have any duty, liability or obligation to any party to this Agreement or any
other Operative Document with respect to the transactions contemplated hereby
except those duties, liabilities, or obligations expressly set forth in this
Agreement or the Loan Agreement, and any such duty, liability or obligation of
Administrative Agent shall be as expressly limited by this Agreement or the Loan
Agreement, as the case may be.
8.14 REPRODUCTION OF DOCUMENTS. This Agreement, all documents constituting
Schedules or Exhibits hereto, and all documents relating hereto received by a
party hereto, including, without limitation: (a) consents, waivers and
modifications that may hereafter be executed; (b) documents received by the
Participants or Administrative Agent in connection with the receipt and/or
acquisition of the Property; and (c) financial statements, certificates, and
other information previously or hereafter furnished to any Administrative Agent
or any Participant may be reproduced by the party receiving the same by any
photographic, photostatic, microfilm, micro-card, miniature photographic or
other similar process. Each of the parties hereto agrees and stipulates that, to
the extent permitted by law, any such reproduction shall be admissible in
evidence as the original itself in any judicial or administrative proceeding
(whether or not the original is in existence and whether or not such
reproduction was made by such party in the regular course of business) and that,
to the extent permitted by law, any enlargement, facsimile, or further
reproduction of such reproduction shall likewise be admissible in evidence.
8.15 ESTOPPEL CERTIFICATES. Each Participant and Administrative Agent
acknowledges and agrees that pursuant to Section 20.10 of the Lease, the parties
thereto may execute, acknowledge and deliver the certificates described therein.
8.16 NOTICES TO LESSOR UNDER LOAN AGREEMENT. Notwithstanding anything to
the contrary in the Loan Agreement, the Lenders, Lessor and Lessee hereby agree
that any notice or demand to be delivered to or made on Lessor pursuant to
Sections 2.7 and 2.11 of the Loan Agreement shall, so long as no Lease Event of
Default is continuing, be delivered directly to or made on the Lessee, with a
copy to Lessor, and the Lessee shall be entitled to any rights inuring to Lessor
in respect thereof.
8.17 CONFIDENTIALITY. (a) Each Participant hereby agrees to maintain the
confidentiality of all "Confidential Information" and agrees that it shall not
disclose such "Confidential Information" to third parties without the prior
consent of the Company, other than disclosure (i)
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on a confidential basis to directors, officers, employees, legal counsel,
accountants and other professional advisors of such Participant, (ii) to other
Participants and any assignee of such Participant, (iii) to regulatory officers
having jurisdiction over such Participant, (iv) as required by law or legal
process or in connection with any legal proceeding to which such Participant is
a party or is otherwise subject, (v) to any transferee or prospective transferee
of such Participant (PROVIDED that such transferee or prospective transferee
shall have agreed, in writing, to be subject to the provisions of this SECTION
8.17) or (vi) on a confidential basis to Affiliates of such Participant who
reasonably could be expected to have a need to know such information in
connection with the administration by such Participant of this Agreement and its
extensions of credit hereunder.
(b) For purposes of this SECTION 8.17, the term "Confidential
Information" shall mean all material, non-public information which is received
by such Participant from the Company or any of its Subsidiaries and is
conspicuously identified as being "Confidential," other than (i) any such
information which, at the time of delivery or thereafter, becomes generally
available to the public other than as a result of a disclosure by such
Participant, (ii) any such information which was available to such Participant
prior to its disclosure to such Participant by the Company and its Subsidiaries
and (iii) any such information which becomes available to such Participant from
a source other than the Company and its Subsidiaries (provided that such source
is not known to such Participant to be (x) bound by a confidentiality agreement
with the Company and its Subsidiaries or (y) otherwise prohibited from
transmitting the information to such Participant by a contractual, legal or
fiduciary obligation).
(c) Notwithstanding anything herein to the contrary, the
information subject to this SECTION 8.17 shall not include, and Lessee,
Administrative Agent, each Participant and the respective Affiliates of each of
the foregoing (and the respective partners, directors, officers, employees,
agents, advisors and other representatives of each of the foregoing and their
Affiliates) may disclose to any and all Persons, without limitation of any kind
(1) any information with respect to the U.S. federal and state income tax
treatment of the transactions contemplated hereby and any facts that may be
relevant to understanding such tax treatment, which facts shall not include for
this purpose the names of the parties or any other Person named herein, or
information that would permit identification of the parties or such other
Persons, or any pricing terms or other nonpublic business or financial
information that is unrelated to such tax treatment or facts, and (2) all
materials of any kind (including opinions or other tax analyses) relating to
such tax treatment or facts that are provided to any of the Persons referred to
above.
8.18 SUBMISSION TO JURISDICTION; WAIVERS. (i) EACH PARTY HERETO
IRREVOCABLY AND UNCONDITIONALLY:
(a) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER OPERATIVE DOCUMENT, OR FOR
RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE
NON-EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, THE
COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK,
AND APPELLATE COURTS FROM ANY THEREOF;
46
<Page>
Participation Agreement
(b) CONSENTS THAT ANY SUCH ACTION OR PROCEEDINGS MAY BE BROUGHT TO
SUCH COURTS, AND WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR
PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM
THE SAME;
(c) 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 ON SCHEDULE III OR AT SUCH OTHER ADDRESS OF WHICH THE OTHER
PARTIES HERETO SHALL HAVE BEEN NOTIFIED PURSUANT TO SECTION 8.3; AND
(d) 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.
(ii) EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES
TRIAL BY JURY - IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THE OPERATIVE
DOCUMENTS AND FOR ANY COUNTERCLAIM THEREIN.
8.19 FINAL AGREEMENT. THIS AGREEMENT, TOGETHER WITH THE LEASE, LOAN
DOCUMENTS, THE OTHER OPERATIVE DOCUMENTS AND OTHER DOCUMENTS EXECUTED IN
CONNECTION HEREWITH OR THEREWITH REPRESENT THE ENTIRE FINAL AGREEMENT BETWEEN
THE PARTIES HERETO WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED HEREIN AND
CANNOT BE MODIFIED, SUPPLEMENTED, AMENDED, RESCINDED OR CONTRADICTED 'BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES
HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES HERETO.
8.20 RIGHT OF SET-OFF. Upon the occurrence and continuance of any Event of
Default, the Administrative Agent and each Lender are hereby irrevocably
authorized by Lessee at any time and from time to time without notice to Lessor,
any such notice being hereby waived by Lessor, to set-off and appropriate and
apply any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by the Administrative Agent or
such Lender to or for the credit or the account of Lessor, or any part thereof
in such amounts as the Administrative Agent or such Lender may elect, on account
of the liabilities of Lessor hereunder and claims of every nature and
description of the Administrative Agent or such Lender against Lessor, in any
currency, whether arising hereunder or under any other Operative Document or
otherwise, as the Administrative Agent or such Lender may elect, whether or not
the Administrative Agent or such Lender has made any demand for payment although
such liabilities and claims may be contingent or unmatured. The Administrative
Agent and each Lender shall notify Lessor
47
<Page>
Participation Agreement
promptly of any such set-off made by it and the application made by it of the
proceeds thereof; PROVIDED that the failure to give such notice shall not affect
the validity of such set-off and application. The rights of the Administrative
Agent and each Lender under this subsection are in addition to other rights and
remedies (including, without limitation, other rights of set-off) which the
Administrative Agent or such Lender may have.
8.21 USA PATRIOT ACT NOTICE. Each Lender, Lessor and Administrative Agent
(for itself and not on behalf of any Lender) hereby notifies Lessee and Lessor
that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the "ACT"), it is required to
obtain, verify and record information that identifies Lessee and Lessor, which
information includes the name and address of Lessee and Lessor and other
information that will allow such Lender or Administrative Agent, as applicable,
to identify Lessee or Lessor in accordance with the Act.
[SIGNATURE PAGES FOLLOW]
48
<Page>
Participation Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Participation
Agreement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
REEBOK INTERNATIONAL LTD., as
Lessee
By: /s/
-------------------------------------
Name Printed: Thomas Chagnon
Title: Vice President and Treasurer
CREDIT SUISSE FIRST BOSTON,
as Administrative Agent, as a Lender
and as Arranger
By: /s/
--------------------------------
Name Printed: Carl Weatherly-White
Title: Director
By: /s/
--------------------------------
Name Printed: William O'Daly
Title: Director
<Page>
Participation Agreement
WACHOVIA BANK, NATIONAL
ASSOCIATION,
as Co-Syndication Agent and as a Lender
By: /s/
--------------------------------------
Name Printed: Denis Waltrich
Title: Associate
By:
--------------------------------------
Name Printed:
Title:
ABN AMRO BANK N.V.,
as a Lender
By: /s/
--------------------------------------
Name Printed: Elizabeth R. McClellan
Title: Vice President
By: /s/
--------------------------------------
Name Printed: Blake J. Lacher
Title: Vice President
<Page>
Participation Agreement
CREDIT SUISSE LEASING 92A, L.P.,
as Lessor
By: CREDIT SUISSE FIRST BOSTON,
as General Partner
By: /s/
------------------------------------------
Name Printed: Carl Weatherly-White
Title: Director
By: /s/
------------------------------------------
Name Printed: William O'Daly
Title: Director
FLEET NATIONAL BANK,
as Co-Documentation Agent and as
a Lender
By: /s/
---------------------------------------
Name Printed: Suzanne Chomiczewski
Title: Vice President
By:
---------------------------------------
Name Printed:
Title:
<Page>
Participation Agreement
BNP PARIBAS LEASING CORPORATION,
as Co-Syndication Agent and a Lender
By: /s/
-----------------------------------------
Name Printed: Lloyd G. Cox
Title: Managing Director
By: /s/
-----------------------------------------
Name Printed: Barry Mendelsohn
Title: Director
SCOTIABANC INC.,
as Co-Documentation Agent and a Lender
By: /s/
-----------------------------------------
Name Printed: William E. Zarrett
Title: Managing Director
By:
-----------------------------------------
Name Printed:
Title:
CITICORP USA, INC.,
as a Lender
By: /s/
-----------------------------------------
Name Printed: John Frezoulis
Title: Vice President
By:
-----------------------------------------
Name Printed:
Title:
<Page>
Participation Agreement
SANPAOLO IMI BANK,
as a Lender
By: /s/
----------------------------------------
Name Printed: Benato Carducci
Title: General Manager
By: /s/
----------------------------------------
Name Printed: Luca Sacchi
Title: Vice President
RZB FINANCE LLC,
as a Lender
By: /s/
----------------------------------------
Name Printed: John A. Valiska
Title: Group Vice President
By: /s/
----------------------------------------
Name Printed: Juan M. Csillagi
Title: Group Vice President
<Page>
Appendix 3 to
Participation Agreement
COMMITMENT FEE
<Table>
<Caption>
AA-or
better BBB+ or
Long-Term and Aa3 A A- better and BBB and BBB -
Unsecured Rating or better and A2 and A3 Baa1 Baa2 and Baa3 Otherwise
- -------------------------------------------------------------------------------------------------
Commitment Fee Rate 7.0 9.0 10.0 15.0 20.0 25.0 35.0
</Table>
Appendix 3-1
<Page>
Schedule I to
Participation Agreement
LESSOR COMMITMENT
<Table>
<Caption>
Commitment
Lessor Commitment Percentage
------ ---------- ----------
Credit Suisse Leasing 92A, L.P. $ 7,500,000.00 5.0% (Original Property)
800,000.00 5.0% (Additional Property)
---------------
Total Commitment $ 8,300,000.00 5.0% (All Property)
===============
</Table>
Schedule I-1
<Page>
Schedule II to
Participation Agreement
COMMITMENTS
TOTAL INVESTMENT [LOANS AND INVESTED AMOUNTS]
<Table>
<Caption>
TOTAL
INVESTED INVESTMENT LENDER
AMOUNT (LOANS AND COMMITMENT
INVESTED COMMITMENT INVESTED PERCENTAGE
LENDER AMOUNT PERCENTAGE AMOUNT) (ROUNDED) TRANCHE A TRANCHE B
- --------------------------------------------------------------------------------------------------------------------------
Credit Suisse First Boston $ 8,300,000 5% $ 25,000,000 10.06% $ 15,030,000.00 $ 1,670,000.00
Fleet National Bank 23,000,000 13.86% 20,700,000.00 2,300,000.00
Scotiabanc Inc. 23,000,000 13.86% 20,700,000.00 2,300,000.00
Wachovia Bank, National Association 23,000,000 13.86% 20,700,000.00 2,300,000.00
BNP Paribas Leasing Corporation 23,000,000 13.86% 20,700,000.00 2,300,000.00
ABN AMRO Bank N.V. 13,000,000 7.83% 11,700,000.00 1,300,000.00
SANPAOLO IMI Bank 13,000,000 7.83% 11,700,000.00 1,300,000.00
Citicorp USA, Inc. 13,000,000 7.83% 11,700,000.00 1,300,000.00
RZB Finance LLC 10,000,000 6.02% 9,000,000.00 1,000,000.00
Total 5% $ 166,000,000 95.01% $ 141,930,000.00 $ 15,770,000.00
==========================================================================================================================
</Table>
Schedule II-1
<Page>
Schedule II to
Participation Agreement
INVESTMENT BY PROPERTY (AS RESTRUCTURED IN 2004)
ORIGINAL PROPERTY
<Table>
<Caption>
TOTAL INVESTED LENDER
INVESTMENT: AMOUNT COMMITMENT
ORIGINAL COMMITMENT INVESTED PERCENTAGE
LENDER PROPERTY PERCENTAGE AMOUNT (ROUNDED) TRANCHE A TRANCHE B
- --------------------------------------------------------------------------------------------------------------------------------
Credit Suisse First Boston $ 22,590,361.45 5.0% $ 7,500,000.00 10.06% $ 13,581,325.30 $ 1,509,036.14
Fleet National Bank 20,783,132.53 13.86% 18,704,819.28 2,078,313.25
Scotiabanc Inc. 20,783,132.53 13.86% 18,704,819.28 2,078,313.25
Wachovia Bank, National Association 20,783,132.53 13.86% 18,704,819.28 2,078,313.25
BNP Paribas Leasing Corporation 20,783,132.53 13.86% 18,704,819.28 2,078,313.25
ABN AMRO Bank N.V. 11,746,987.95 7.83% 10,572,289.16 1,174,698.80
SANPAOLO IMI Bank 11,746,987.95 7.83% 10,572,289.16 1,174,698.80
Citicorp USA, Inc. 11,746,987.95 7.83% 10,572,289.16 1,174,698.80
RZB Finance LLC 9,036,144.58 6.02% 8,132,530.12 903,614.46
- --------------------------------------------------------------------------------------------------------------------------------
Total $ 150,000,000.00 5.0% $ 7,500,000.00 95.01% $ 128,250,000.00 $ 14,250,000.00
================================================================================================================================
</Table>
ADDITIONAL PROPERTY
<Table>
<Caption>
TOTAL INVESTED
INVESTMENT: AMOUNT LENDER
ADDITIONAL COMMITMENT INVESTED COMMITMENT
LENDER PROPERTY PERCENTAGE AMOUNT PERCENTAGE TRANCHE A TRANCHE B
- --------------------------------------------------------------------------------------------------------------------------------
Credit Suisse First Boston $ 2,409,638.55 5.0% $ 800,000.00 10.06% $ 1,448,674.70 $ 160,963.86
Fleet National Bank 2,216,867.47 13.86% 1,995,180.72 221,686.75
Scotiabanc Inc. 2,216,867.47 13.86% 1,995,180.72 221,686.75
Wachovia Bank, National Association 2,216,867.47 13.86% 1,995,180.72 221,686.75
BNP Paribas Leasing Corporation 2,216,867.47 13.86% 1,995,180.72 221,686.75
ABN AMRO Bank N.V. 1,253,012.05 7.83% 1,127,710.84 125,301.20
SANPAOLO IMI Bank 1,253,012.05 7.83% 1,127,710.84 125,301.20
Citicorp USA, Inc. 1,253,012.05 7.83% 1,127,710.84 125,301.20
RZB Finance LLC 963,855.42 6.02% 867,469.88 96,385.54
- --------------------------------------------------------------------------------------------------------------------------------
Total $ 16,000,000.00 5.0% $ 800,000.00 95.01% $ 13,680,000.00 $ 1,520,000.00
================================================================================================================================
</Table>
Schedule II-2
<Page>
Schedule II to
Participation Agreement
NET INCREASE (DECREASE) IN INVESTMENT [LOANS AND INVESTED AMOUNTS]
<Table>
<Caption>
(1998 TRANSACTION) NET CHANGE
RESTRUCTURED AMOUNT LOANS
(1998 TRANSACTION) 2004 RESTRUCTURING TO BE PAID BY (OR RETURNED TO)
ORIGINAL AMOUNT FOR ORIGINAL PROPERTY APPLICABLE LENDER
- -----------------------------------------------------------------------------------------------------------------------------------
LENDER TRANCHE A TRANCHE B TRANCHE A TRANCHE B TRANCHE A TRANCHE B
- -----------------------------------------------------------------------------------------------------------------------------------
Credit Suisse First Boston 22,899,000.00 2,601,000.00 13,581,325.30 1,509,036.14 (9,317,674.70) (1,091,963.86)
Fleet National Bank 26,940,000.00 3,060,000.00 18,704,819.28 2,078,313.25 (8,235,180.72) (981,686.75)
Scotiabanc Inc. 0.00 0.00 18,704,819.28 2,078,313.25 18,704,819.28 2,078,313.25
Wachovia Bank, National Association 26,940,000.00 3,060,000.00 18,704,819.28 2,078,313.25 (8,235,180.72) (981,686.75)
BNP Paribas Leasing Corporation 13,470,000.00 1,530,000.00 18,704,819.28 2,078,313.25 5,234,819.28 548,313.25
ABN AMRO Bank N.V. 13,470,000.00 1,530,000.00 10,572,289.16 1,174,698.80 (2,897,710.84) (355,301.20)
SANPAOLO IMI Bank 0.00 0.00 10,572,289.16 1,174,698.80 10,572,289.16 1,174,698.80
Citicorp USA, Inc. 13,470,000.00 1,530,000.00 10,572,289.16 1,174,698.80 (2,897,710.84) (355,301.20)
RZB Finance LLC 0.00 0.00 8,132,530.12 903,614.46 8,132,530.12 903,614.46
Intesabci SPA 13,470,000.00 1,530,000.00 0.00 0.00 (13,470,000.00) (1,530,000.00)
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL 130,659,000.00 14,841,000.00 128,250,000.00 14,250,000.00
===================================================================================================================================
</Table>
<Table>
<Caption>
1998 TRANSACTION
RESTRUCTURED AMOUNT
1998 TRANSACTION 2004 RESTRUCTURING NET CHANGE
ORIGINAL FOR ORIGINAL PROPERTY INVESTED AMOUNT
INVESTED AMOUNT [COMMITMENT PERCENTAGE] [COMMITMENT PERCENTAGE] [COMMITMENT PERCENTAGE]
- -----------------------------------------------------------------------------------------------------
Credit Suisse First Boston 4,500,000.00 7,500,000.00 3,000,000.00
[3.0%] [5.0%] [2.0%]
</Table>
Schedule II-3
<Page>
TO AMENDED AND RESTATED PARTICIPATION AGREEMENT
DEFINITIONS APPENDIX
APPENDIX 1
to
AMENDED AND RESTATED PARTICIPATION AGREEMENT
(Reebok International Ltd.)
In the Amended and Restated Participation Agreement and each other
Operative Document, unless the context otherwise requires:
(a) any term defined below by reference to another instrument or document
shall continue to have the meaning ascribed thereto whether or not such other
instrument or document remains in effect;
(b) words importing the singular include the plural and vice versa;
(c) words importing a gender include any gender;
(d) a reference to a part, clause, section, article, exhibit or schedule
is a reference to a part, clause, section and article of, and exhibit and
schedule to, such Operative Document;
(e) a reference to any statute, regulation, proclamation, ordinance or law
includes all statutes, regulations, proclamations, ordinances or laws amending,
supplementing, supplanting, varying, consolidating or replacing them, and a
reference to a statute includes all regulations, proclamations and ordinances
issued or otherwise applicable under that statute;
(f) a reference to a document includes any amendment or supplement to, or
replacement or novation of, that document;
(g) a reference to a party to a document includes that party's successors
and permitted assigns; and
(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.
Further, each of the parties to the Operative Documents and its counsel has
reviewed and revised the Operative Documents, and. the usual rule of
construction that any ambiguities are to be resolved against the drafting party
sha1l be inapplicable in construing and interpreting the Operative Documents.
1
<Page>
"ABR" means, for any day, a rate per annum equal to the higher of (a) the
Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in
effect on such day plus 1/2 of 1%. Any change in the ABR due to a change in the
Prime 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 Rate or the
Federal Funds Effective Rate, respectively.
"ABR LOANS" means Loans the rate of interest applicable to which is based
upon the ABR.
"ACQUISITION DATE" has the meaning specified in SECTION 3.3 of the
Participation Agreement.
"ADDITIONAL COSTS" mean the amounts payable pursuant to Sections 2.11, 2.12
and 2.13 of the Loan Agreement and the other amounts due and payable by the
Borrower under any Loan Document other than principal and interest on the Notes.
"ADDITIONAL FACILITY" has the meaning set forth in the Recitals to the
Participation Agreement.
"ADDITIONAL LAND" has the meaning set forth in the Recitals to the
Participation Agreement.
"ADDITIONAL PROPERTY" has the meaning set forth in the Recitals to the
Participation Agreement.
"ADDITIONAL PROPERTY APPRAISAL" has the meaning set forth in SECTION 3.3(1)
of the Participation Agreement.
"ADDITIONAL PROPERTY COMMITMENT AMOUNT" means $16,000,000.
"ADDITIONAL PROPERTY LESSOR'S POLICY" has the meaning set forth in SECTION
3.3(d) of the Participation Agreement.
"ADDITIONAL PROPERTY LOAN POLICY" has the meaning set forth in SECTION
3.3(d) of the Participation Agreement.
"ADDITIONAL PROPERTY SUBLEASE" means the sublease of the Additional
Property dated as of the Acquisition Date between Lessee, as lessor, and the
Seller, as lessee.
"ADDITIONAL PROPERTY TITLE POLICIES" has the meaning set forth in SECTION
3.3(d) of the Participation Agreement.
"ADJUSTMENT DATE" means (a) the second Business Day following receipt by
the Administrative Agent of both (i) the financial statements required to be
delivered pursuant to SECTIONS 5.10(a) or 5.10(b) of the Participation Agreement
for the most recently completed fiscal period and (ii) the compliance
certificate required pursuant to SECTION 5.10(d) of the Participation Agreement
with respect to such financial statements or (b) if such compliance certificate
and
2
<Page>
financial statements have not been delivered in a timely manner, the latest date
upon which the compliance certificate required to be delivered pursuant to
SECTION 5.10(d) of the Participation Agreement for the most recently completed
fiscal period was due; PROVIDED, HOWEVER, that in the event that the Adjustment
Date is determined in accordance with the provisions of clause (b) of this
definition, then the date which is two Business Days following the date of
receipt of the financial statements and compliance certificate referenced in
clause (a) of this definition also shall be deemed to constitute an "Adjustment
Date".
"ADMINISTRATION FEE" means the administration fee as agreed to in writing
between the Company and the Administrative Agent.
"ADMINISTRATIVE AGENT" means Credit Suisse First Boston, in its capacity as
Administrative Agent for the Lenders under the Loan Agreement and the
Participation Agreement.
"ADVANCE" means each advance of funds by the Lenders to the Lessor and by
Lessor to or on behalf of Lessee, in each case pursuant to Article II of the
Participation Agreement, and shall include the amount of the Outstanding Loan
Balance and Outstanding Investor Balance advanced pursuant to the Original
Operative Documents.
"ADVANCE DATE(s)" means the actual date on which an Advance occurs.
"ADVANCE REQUEST" has the meaning set forth in SECTION 2.4 of the
Participation Agreement.
"AFFILIATE" of any Person means (a) any Person (other than a Subsidiary)
which, directly or indirectly, is in control of, is controlled by, or is under
common control with such Person. For purposes of this definition, control of a
Person shall mean the power, directly or indirectly, (i) to vote 10% or more of
the securities having ordinary voting power for the election of directors of
such Person or (ii) to direct or cause the direction of the management and
policies of such Person, whether by contract or otherwise.
"APB 16" means Accounting Principles Board Opinion No. 16 as in effect on
the date hereof.
"APPLICABLE LAW" means as to any Person, the certificate of incorporation
and by-laws or other organizational or governing documents of such Person, and
all existing and future laws, rules, regulations (including Environmental Laws),
statutes, treaties, codes, ordinances, permits, certificates, orders and
licenses of and interpretations by, any Authority, Insurance Requirements and
judgments, decrees, injunctions, writs, orders or like action of any court,
arbitrator or other administrative, judicial or quasi-judicial tribunal or
agency of competent jurisdiction (including those pertaining to health, safety
or the environment and those pertaining to the construction, use or occupancy of
any Property) and any restrictive covenant or deed restriction or easement of
record, in each case applicable to or binding upon such Person or any of its
property or any Property or to which such Person, or any of its property or any
Property is subject.
3
<Page>
"APPLICABLE MARGIN": for each Type of Loan for each day, the rate PER ANNUM
set forth below opposite the debt rating then in effect.
<Table>
<Caption>
Applicable Margin
------------------------
Eurodollar
Debt Rating ABR Loans Loans
------------------------------------------------------------------------------
AA- or better by S&P and Aa3 or better by Moody's 7.0 bp 50.0 bp
A or better by S&P and A2 or better by Moody's 9.0 bp 57.5 bp
but not AA- or better by S&P and Aa3 or better
by Moody's
A- or better by S&P and A3 or better by Moody's 10.5 bp 75.0 bp
but not A or better by S&P and A2 or better by
Moody's
BBB+ or better by S&P and Baal or better by 15.0 bp 100.0 bp
Moody's, but not A- or better by S&P and A3 or
better by Moody's
BBB or better by S&P and Baa2 or better by 20.0 bp 112.5 bp
Moody's, but not BBB+ or better by S&P and Baa
or better by Moody's
BBB- or better by S&P and Baa3 or better by 25.0 bp 125.0 bp
Moody's, but not BBB or better by S&P and Baa2
or better by Moody's
Otherwise 50.0 bp 150.0 bp
</Table>
"APPRAISAL" means the Original Property Appraisal or the Additional
Property Appraisal.
"APPRAISED VALUE" means each of the opinions rendered by the Appraiser
pursuant to SECTIONS 3.1(p) or 3.3(1) of the Participation Agreement.
"APPRAISER" means CB Richard Ellis or such other appraisal firm as
Administrative Agent may select from time to time after consultation with the
Lessee, provided that the appraisal firm shall be selected in the sole
discretion of the Administrative Agent.
"APPRAISER ENGAGEMENT LETTER" means the letter dated February 3, 2004,
between the Appraiser and the Administrative Agent.
"APPURTENANT RIGHTS" means (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 either Property, including the use of any streets, ways, alleys, vaults or
strips of land adjoining, abutting, adjacent or contiguous to either Property
and (ii) all permits, licenses and rights, whether or not of record, appurtenant
to either Property.
4
<Page>
"ARRANGEMENT FEE" means the arrangement fee as agreed to in writing between
the Company and the Arranger.
"ARRANGER" means Credit Suisse First Boston in its capacity as "lead
arranger" with respect to the transactions contemplated by the Operative
Documents.
"ASSIGNMENT OF CONSTRUCTION AGREEMENT" means the Assignment of Construction
Agreement between Lessor and Construction Agent pursuant to the Construction
Agency Agreement.
"ASSIGNMENT OF LEASE" means the Amended and Restated Assignment of Lease in
the form of Exhibit J to the Participation Agreement from Lessor in favor of
Administrative Agent for the benefit of the Lenders.
"ASSIGNMENT OF LEASE AGREEMENT" means the Assignment of Lease from Lessor
to Administrative Agent for the benefit of the Original Lenders pursuant to the
Original Participation Agreement.
"ASSUMED INTEREST RATE" means, with respect to any Advance Date that does
not occur as proposed in the related Advance Request, the Eurodollar Rate that
would have been applicable for purposes of calculating Interest and Yield if the
Advance Date to which such Advance Request relates had occurred on the
originally proposed date.
"AUTHORITY" means any applicable foreign, federal, state, county, municipal
or other government or governmental, quasi-governmental or regulatory authority,
agency, board, body, commission, instrumentality, court or tribunal, or any
political subdivision of any thereof, or arbitrator or panel of arbitrators.
"AUTHORIZED OFFICER" means any officer of Lessor who shall be duly
authorized to execute the Operative Documents.
"BALANCE SHEET" is defined in SECTION 4.1(w)(i) of the Participation
Agreement.
"BANKRUPTCY CODE" means the Bankruptcy Reform Act of 1978.
"BASE TERM" has the meaning set forth in Section 2.3 of the Lease.
"BASE TERM EXPIRATION DATE" has the meaning set forth in Section 2.3 of the
Lease.
"BASIC RENT" means an amount payable in installments on each Rent Payment
Date during the Base Term and a Renewal Term equal to the sum of (A) the
aggregate amount of Interest payable on the Notes on the corresponding Payment
Date, plus (B) the aggregate amount of the Yield payable on such Payment Date.
"BENEFITTED LENDER" has the meaning set forth in Section 8.4 of the Loan
Agreement.
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"BOARD OF DIRECTORS" means, with respect to a corporation, either the board
of directors or any duly authorized committee of that board of directors which,
pursuant to the by-laws of such corporation, has the same authority as that
board of directors as to the matter at issue.
"BORROWER" means Lessor as the borrower under the Loan Agreement.
"BUSINESS DAY" means any day of the year other than a Saturday, Sunday or
other day on which commercial banks in New York City are required or authorized
by law to close and, if the applicable Business Day relates to any Eurodollar
Loan, the term "Business Day" shall mean a day other than a Saturday, Sunday or
other day on which commercial banks in New York City or London, England are
required or authorized by law to close.
"CASUALTY" means an event of damage or casualty relating to a Property
which does not constitute an Event of Loss.
"CERTIFICATION NOTICE" has the meaning set forth in Section 6.3(a) of the
Lease.
"CHANGE IN LAW" means with respect to any Lender the adoption of any law,
rule, regulation, policy, guideline or directive (whether or not having the
force of law) or any change therein or in the interpretation or application
thereof by any Authority having jurisdiction over such Lender, in each case
after the Documentation Date.
"CLAIM NOTICE" has the meaning specified in Section 3(a) of the
Environmental Indemnity.
"CLAIMS" mean liabilities, obligations, damages, losses, demands,
penalties, fines, claims, actions, suits, judgments, settlements, utility
charges, costs, fees, expenses and disbursements (including legal fees and
expenses and costs of investigation which, in the case of counsel or
investigators retained by an Indemnitee, shall be reasonable) of any kind and
nature whatsoever.
"CLOSING DATE" means the date on which the conditions precedent set forth
in SECTION 3.1 of the Participation Agreement shall be satisfied or waived.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time.
"CO-DOCUMENTATION AGENT" means each of Fleet National Bank and Scotia Bank
Inc., in its capacity as Co-Documentation Agent for the Lenders under the Loan
Agreement and the Participation Agreement.
"COLLATERAL" means (a) with respect to the Lenders, the Property and all of
the other property and rights now owned or hereafter acquired by Lessor and
proceeds therefrom in connection with the transactions contemplated by the
Operative Documents and any proceeds therefrom upon which a Lien is purported to
be created pursuant to the Operative Documents and (b) with respect to the
Lessor, all of Lessee's rights, title and interest, whether now or hereafter
existing or acquired, in the Property, any deposit account maintained by the
Lessor or its designee for itself and the benefit of the Lenders and any
proceeds therefrom upon which a lien is purported to be created pursuant to the
Operative Documents.
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"COMMITMENT" means as to any Participant, its obligation to make amounts
available, (Loans or Invested Amounts, as the case may be) to the Borrower in an
aggregate amount not to exceed at any one time outstanding the amount set forth
opposite such Participant's name on SCHEDULE I or II to the Participation
Agreement (as applicable) as adjusted pursuant to Section 2.4(i) of the
Participation Agreement, which amount shall include such Participant's portion
of the Outstanding Funded Amount and the Additional Property Commitment Amount.
"COMMITMENT FEE" has the meaning specified in SECTION 2.5 of the
Participation Agreement.
"COMMITMENT PERCENTAGE" means as to any Participant, at a particular time,
the percentage of the aggregate Commitments in effect at such time represented
by such Participant's Commitment, as such percentage is shown on SCHEDULE I or
II to the Participation Agreement, as applicable.
"COMMITMENT PERIOD" has the meaning set forth in SECTION 2.5 of the
Participation Agreement.
"COMMITMENT PERIOD TERMINATION DATE" means June 30, 2004.
"COMMONLY CONTROLLED ENTITY" means an entity, whether or not incorporated,
which is under common control with the Company within the meaning of Section
414(b) or (c) of the Code.
"COMPANY" means Reebok International Ltd., a Massachusetts corporation.
"CONDEMNATION" means any condemnation, requisition, confiscation, seizure
or other taking or sale of the use, occupancy or title to any Property or any
part thereof in, by or on account of any actual or threatened eminent domain
proceeding or other action by any Authority or other Person under the power of
eminent domain or otherwise or any transfer in lieu of or in anticipation
thereof, which in any case does not constitute an Event of Taking. A
Condemnation shall be deemed to have "occurred" on the earliest of the dates
that use, occupancy or title is taken.
"CONSOLIDATED NET INCOME" or "CONSOLIDATED NET LOSS" means, for any fiscal
period, the amount which, in conformity with GAAP, would be set forth opposite
the caption "net income" or any like caption) or "net loss" (or any like
caption), as the case may be, on a consolidated statement of earnings of the
Company and its Subsidiaries for such fiscal period.
"CONSTRUCTION AGENCY AGREEMENT" means the Construction Agency Agreement
entered into pursuant to the Original Participation Agreement.
"CONSTRUCTION AGENT" means the Lessee, as construction agent under the
Construction Agency Agreement.
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"CO-SYNDICATION AGENT" means of each Wachovia Bank, National Association
and BNP Paribas Leasing Corporation, in its capacity as Co-Syndication Agent for
the Lenders under the Loan Agreement and the Participation Agreement.
"CONTINUING DIRECTORS" has the meaning specified in Section 17(j) of the
Lease.
"CONTRACTUAL OBLIGATION" means as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or undertaking to
which such Person is a party or by which it or any of the property owned by it
is bound.
"CREDIT RATING" means the rating publicly announced from time to time by
Moody's or S&P (as the context shall require) as being in effect with respect to
the senior, unsecured (and non-credit enhanced), long-term Indebtedness of the
Company.
"DEED" means the deed from the Seller of the Additional Property which is a
fee estate to Lessor, conveying the Additional Property to Lessor. Such deed
will be in the form provided in the Purchase Agreement, which shall be the
customary form of special warranty deed, or equivalent, in the relevant
jurisdiction.
"DEFAULT" means any Lease Default or any Loan Default.
"DESIGNATED AGENTS" has the meaning set forth in Section 7.1 of the Loan
Agreement.
"DISCLOSED MATERIAL" has the meaning specified in Section 8(f) of the
Environmental Indemnity.
"DOCUMENTATION DATE" has the meaning set forth in SECTION 2.1(a) of the
Participation Agreement.
"DOCUMENTATION DATE PREPAYMENT AMOUNT" has the meaning set forth in the
Recitals to the Participation Agreement.
"DOLLAR" and the symbol "$" shall mean lawful currency of the United States
of America.
"DOMESTIC SUBSIDIARY" means any Subsidiary of the Company other than a
Foreign Subsidiary.
"EARLY TERMINATION DATE" means a Rent Payment Date prior to the Termination
Date on which Lessee purchases a Property from Lessor pursuant to Section 6.1 of
the Lease.
"EBITDA" means for any fiscal period, the Consolidated Net Income or
Consolidated Net Loss, as the case may be, for such fiscal period, after
restoring thereto amounts deducted for (a) extraordinary losses (or deducting
therefrom any amounts included therein on account of extraordinary gains) and
special charges, (b) depreciation and amortization (including write-offs or
write-downs of amortizable and depreciable items), (c) the amount of interest
expense of the Company and its Subsidiaries, determined on a consolidated basis
in accordance with GAAP, for such period on the aggregate principal amount of
their consolidated Indebtedness, (d) the amount
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of tax expense of the Company and its Subsidiaries, determined on a consolidated
basis in accordance with GAAP, for such period and (e) minority interests.
"ENVIRONMENTAL AUDIT" means a Phase One environmental site assessment (the
scope and performance of which meets or exceeds ASTM Standard Practice E1527-00
Standard Practice for Environmental Site Assessments: Phase One Environmental
Site Assessment Process) of the Original Property or the Additional Property to
be acquired by Lessor on the Acquisition Date or of each Property as it is to be
sold pursuant to the Remarketing Option under the Lease and any additional
environmental assessments requested by the Agents in good faith.
"ENVIRONMENTAL CERTIFICATE" is defined in SECTION 3.1(l) of the
Participation Agreement.
"ENVIRONMENTAL CLAIM" has the meaning specified in Section 3(a) of the
Environmental Indemnity.
"ENVIRONMENTAL ENGINEER" means, with respect to the Original Property,
Vanasse Hangen Brustlin, Inc. and with respect to the Additional Property, GEI
Incorporated, or, in each case, such other environmental consulting firm as
Lessee may from time to time select, and reasonably satisfactory to the
Administrative Agent.
"ENVIRONMENTAL INDEMNITY" means the Amended and Restated Environmental
Indemnity dated as of the Documentation Date executed by the Lessee for the
benefit of the Indemnitees.
"ENVIRONMENTAL LAWS" mean the Resource Conservation and Recovery Act of
1976, (RCRA) 42 U.S.C. Sections 6901-6987, as amended by the Hazardous and Solid
Waste Amendments of 1984, the Comprehensive Environmental Response, Compensation
and Liability Act, as amended by the Superfund Amendments and Reauthorization
Act of 1986, 42 U.S.C. Sections 9601-9657, (CERCLA), the Hazardous Materials
Transportation Act of 1975, 49 U.S.C. Sections 1801-1812, the Toxic Substances
Control Act, 15 U.S.C. Sections 2601-2671, the Clean Air Act, 42 U.S.C. Sections
7401 et seq., the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C.
Sections 136 et seq. and all similar federal, state and local environmental
laws, ordinances, rules, orders, statutes, decrees, judgments, injunctions,
codes and regulations, and, any other federal, state or local laws, ordinances,
rules, codes and regulations, and any other federal, state or local laws,
ordinances, rules, codes and regulations relating to the environment, human
health or natural resources or the regulation or control of or imposing
liability or standards of conduct concerning human health, the environment,
Hazardous Materials or the clean-up or other remediation of a Property, or any
part thereof.
"ENVIRONMENTAL PERMITS" means all permits, licenses, authorizations,
registrations, certificates and approvals of Authorities required by
Environmental Laws.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"EUROCURRENCY RESERVE REQUIREMENTS" means, for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the rates (expressed as
a decimal fraction) of reserve
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requirements in effect on such day (including, without limitation, basic,
supplemental, marginal and emergency reserves under any regulations of the Board
of Governors of the Federal Reserve System or other Authority having
jurisdiction with respect thereto) dealing with reserve requirements prescribed
for Eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of such Board) maintained by a member bank of such System.
"EURODOLLAR BASE RATE" means the rate per annum determined by the
Administrative Agent at approximately 11:00 a.m. (London time) on the date which
is two Business Days prior to the beginning of the relevant Interest Period (as
specified in the applicable Notice of Borrowing) by reference to the British
Bankers' Association Interest Settlement Rates for deposits in Dollars (as set
forth by any service selected by the Administrative Agent which has been
nominated by the British Bankers' Association as an authorized information
vendor for the purpose of displaying such rates) for a period equal to such
Interest Period; PROVIDED that, to the extent that an interest rate is not
ascertainable pursuant to the foregoing provisions of this definition, the
"Eurodollar Base Rate" shall be the interest rate per annum determined by the
Administrative Agent to be the average of the rates per annum at which deposits
in Dollars are offered for such relevant Interest Period to major banks in the
London interbank market in London, England by the Reference Banks at
approximately 11:00 a.m. (London time) on the date which is two Business Days
prior to the beginning of such Interest Period. If any of the Reference Banks
shall be unable or shall otherwise fail to supply such rates to the
Administrative Agent upon its request, the rate of interest shall, subject to
the provisions of SECTION 2.7, be determined on the basis of the quotations of
the remaining Reference Banks or Reference Bank.
"EURODOLLAR LOANS" means Loans the rate of interest applicable to which is
based upon the Eurodollar Rate.
"EURODOLLAR OFFICE" means initially, the funding office of each Participant
designated as such in SCHEDULE III and thereafter, such other office of such
Participant, if any, which shall be making or maintaining such Participant's
investment in Notes.
"EURODOLLAR RATE" means, with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, a rate per annum determined for such day
in accordance with the following formula:
EURODOLLAR BASE RATE
1.00 - Eurocurrency Reserve Requirements
"EVENT OF DEFAULT" means any Lease Event of Default or, Loan Event of
Default.
"EVENT OF LOSS" means, with respect to a Property (w) any event or
circumstance at such Property which event or circumstance is reasonably expected
by Lessee to result in Environmental Claims (including costs of cleanup and
remediation) in excess of $37,500,000 with respect to the Original Property or
$10,000,000 with respect to the Additional Property imposed on or incurred by
any Indemnitee or Lessee, (x) the actual or constructive total loss of such
Property or damage to such Property to an extent rendering repair impractical
uneconomical, in any case as reasonably determined in good faith by the Board of
Directors of
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the Company, such determination to be made promptly after the occurrence of such
event and to be evidenced by an Officer's Certificate of the Company delivered
to Lessor and Administrative Agent, (y) damage to such Property which results in
an insurance settlement on the basis of a total loss or a constructive total
loss (including title insurance proceeds) in respect of a total loss of such
Property, or (z) an Event of Taking with respect to such Property.
"EVENT OF TAKING" means, with respect to a Property (A) taking of title to
such Property or (B) any condemnation (other than a requisition of temporary
use) or requisition of use for a period scheduled to last beyond the end of the
Lease Term, in either case resulting in (i) the loss of use or possession of all
or substantially all of such Property or (ii) the loss of use or possession of a
portion of such Property where the loss would have a material adverse effect on
the use, operation or value thereof, in either of CLAUSE (i) or CLAUSE (ii), as
reasonably determined in good faith by a Responsible Officer of the Company,
such determination to be made promptly after the occurrence of such event and to
be evidenced by an Officer's Certificate of such Responsible Officer delivered
to Lessor and Administrative Agent.
"EXCLUDED AMOUNTS" means:
(a) all indemnity payments and expenses to which Lessor (or the respective
successors, assigns, agents, officers, directors or employees of Lessor) is
entitled pursuant to the Operative Documents or the Original Operative
Documents;
(b) any amounts payable under any Operative Documents or Original
Operative Documents to reimburse Lessor (including the reasonable expenses
of Lessor incurred in connection with any such payment) for performing any
of the obligations of Lessee under and as permitted by any Operative
Document or Original Operative Document;
(c) any insurance proceeds (or payments with respect to risks self-insured
or policy deductibles) under liability policies payable to Lessor (or the
respective successors, assigns, agents, officers, directors or employees of
Lessor);
(d) any insurance proceeds under policies maintained by Lessor and not
required to be maintained by Lessee under the Lease;
(e) any amount payable to Lessor pursuant to SECTION 8.9;
(f) prior to completion of any foreclosure of the Mortgage or deed in lieu
thereof, any expense reimbursements to Lessor or Administrative Agent; and
(g) any payments of interest on payments referred to in CLAUSES (a)
through (f) above.
"FACILITY" means, individually, the Original Facility or the Additional
Facility, and collectively, the Original Facility and the Additional Facility.
"FAIR MARKET SALES VALUE" with respect to any Property or any portion
thereof means, as of the date of the determination, the fair market sales value
as determined by the Appraiser that would be obtained in an arm's-length
transaction between an informed and willing buyer (other
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than a buyer currently in possession) and an informed and willing seller, under
no compulsion to buy or sell, and neither of which is related to Lessee, for the
purchase of such Property. Such fair market sales value shall be calculated as
the value for the use of the Property, assuming, in the determination of such
fair market sales value, that the Property is in the condition and repair
required to be maintained by, the terms of the Lease or as otherwise stated in
the Participation Agreement.
"FEDERAL FUNDS EFFECTIVE RATE" means for any day, 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 on the next
succeeding 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 the day of such transactions received by the Administrative Agent
from three federal funds brokers of recognized standing selected by it.
"FINAL MATURITY DATE" means the date five (5) years after the Documentation
Date or, if the Operative Documents are extended for a Renewal Term pursuant to
Section 2.4 of the Lease, the Final Maturity Date will be extended to the date
that is five (5) years after the Final Maturity Date then in effect.
"FINAL RENT PAYMENT DATE" has the meaning set forth in Section 18.1(h) of
the Lease.
"FINANCING LEASE" means any lease of property, real or personal, the
obligations of the lessee in respect of which are required in accordance with
GAAP to be capitalized on a balance sheet of Lessee.
"FIRPTA" means the Foreign Investment in Real Property Tax Act, as amended
from time to time.
"FORCE MAJEURE" means as to any Person, any event or condition beyond its
reasonable control and without its fault or negligence, such as acts of God,
fire, windstorm, flood, earthquake, explosion, collapse of structures, riot, war
or labor disputes which adversely affects such Person's ability to perform its
obligations under any Operative Document to which it is a party.
"FOREIGN SUBSIDIARY" means any Subsidiary of the Company which is organized
under the laws of any jurisdiction outside the United States of America.
"GAAP" means generally accepted accounting principles in the United States
of America as in effect on the Documentation Date.
"GOVERNMENT ACTION" means all applicable permits, authorizations,
registrations, consents, approvals, waivers, exceptions, variances, orders,
judgments, decrees, licenses, exemptions, publications, filings, notices to and
declarations of or with, or required by, any Authority, or required by any
Applicable Law, and shall include, without limitation, all citings,
Environmental Permits and operating permits and licenses that are required for
the use, occupancy, zoning and operation of either Property.
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"GUARANTEE OBLIGATION" means as to any Person (the "GUARANTEEING PERSON"),
any obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the creation
of which the guaranteeing person has issued a reimbursement, counterindemnity or
similar obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "PRIMARY OBLIGATIONS")
of any other third Person (the "PRIMARY OBLIGOR") in any manner, whether
directly or indirectly, including, without limitation, any obligation of such
Person, whether or not contingent, (1) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (ii) to
advance or supply funds (1) for the purchase or payment of any such primary
obligation or (2) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the owner of any such primary obligation against loss
in respect thereof; PROVIDED, HOWEVER, that the term Guarantee Obligation shall
not include endorsements of instruments for deposit or collection in the
ordinary course of business. The amount of any Guarantee Obligation of any
guaranteeing person shall be deemed to be the lower of (a) an amount equal to
the stated or determinable amount of the primary obligation or portion thereof
in respect of which such Guarantee Obligation is made and (b) the maximum amount
for which such guaranteeing person may be liable pursuant to the terms of the
instrument embodying such Guarantee Obligation, unless such primary obligation
and the maximum amount for which such guaranteeing person may be liable are not
stated or determinable, in which case the amount of such Guarantee Obligation
shall be such guaranteeing person's maximum reasonably anticipated net liability
in respect thereof as determined by the Company in good faith.
"GUARANTEED RESIDUAL AMOUNT" is $128,250,000 with respect to the Original
Property and $13,680,000 with respect to the Additional Property.
"GUARANTOR" means the Company.
"GUARANTY" means the Amended and Restated Guaranty in the form of Exhibit L
to the Participation Agreement.
"HAZARDOUS ACTIVITY" has the meaning specified in the first recital to the
Environmental Indemnity.
"HAZARDOUS MATERIAL" means any substance, waste or material which is toxic,
explosive, corrosive, flammable, infectious, radioactive, carcinogenic,
mutagenic or otherwise hazardous by listing characteristic or definition under
any Environmental Law, including gasoline or petroleum, crude oil or any
fraction thereof, petroleum derivatives, by-products and other hydrocarbons and
is or becomes defined or regulated as such by any Authority, including any
agency, department, commission, board or instrumentality of the United States,
the State in which the Property is located or any political subdivision thereof
and also including asbestos, urea formaldehyde foam insulation, polychlorinated
biphenyls ("PCBS") and radon gas.
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"INDEBTEDNESS" means of any Person, at any date, (a) all indebtedness of
such Person for borrowed money or for the deferred purchase price of property or
services (other than current trade liabilities incurred in the ordinary course
of business and payable in accordance with customary practices), (b) any other
indebtedness of such Person which is evidenced by a note, bond, debenture or
similar instrument, (c) all obligations of such Person under capital leases (as
determined in accordance with GAAP), (d) all obligations of such Person in
respect of acceptances issued or created for the account of such Person, (e) all
liabilities secured by any Lien on any property owned by such Person even though
such Person has not assumed or otherwise become liable for the payment thereof
and (f) all Indebtedness of the types referred to in clauses (a) through (e)
above which is guaranteed directly or, indirectly by such Person.
"INDEMNITEE" means each Lender, the Administrative Agent (in its individual
capacity) and Lessor, and the respective Affiliates, successors, permitted
assigns, permitted transferees, invitees, contractors, servants, employees,
officers, directors, shareholders, partners, participants, representations and
agents of each of the foregoing Persons; PROVIDED, HOWEVER, that in no event
shall Lessee be an Indemnitee.
"INDEMNITOR" has the meaning specified in the introductory paragraph to the
Environmental Indemnity.
"INSOLVENCY" means with respect to a Multiemployer Plan, the condition that
such Plan is insolvent within the meaning of such term as used in Section 4245
of ERISA.
"INSOLVENCY EVENT" means, with respect to any Person, any event pursuant to
which such Person makes an assignment for the benefit of creditors, files a
petition in bankruptcy, petitions or applies to any tribunal for the appointment
of a custodian, receiver or any trustee for it or for a substantial part of its
property, commences any proceeding under any bankruptcy, reorganization,
arrangement, readjustment of debt, dissolution or liquidation law or statute of
any jurisdiction, whether now or hereafter in effect, consents or acquiesces in
the filing of any such petition, application, proceeding or appointment of or
taking possession by the custodian, receiver, liquidator, assignee, trustee or
sequestrator (or other similar official) of such Person or any substantial part
of its property, or admits its inability to pay its debts generally as they
become due, or authorizes any of the foregoing to be done or taken on behalf of
such Person.
"INSPECTING PARTIES" have the meaning specified in Section 15.1 of the
Lease.
"INSURANCE REQUIREMENTS" means all terms and conditions of any insurance
policy required by the Lease to be maintained by Lessee, and all requirements of
the issuer of any such policy.
"INTELLECTUAL PROPERTY" is defined in SECTION 4.1(CC) of the Participation
Agreement.
"INTEREST" means interest, including Overdue Interest, due and payable
under the Loan Agreement from time to time.
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"INTEREST PAYMENT DATE" means (a) as to any ABR Loan, the last Business Day
of each March, June, September and December, (b) as to any Eurodollar Loan
having an Interest Period of three months or less, the last day of such Interest
Period and (c) as to any Eurodollar Loan having an Interest Period longer than
three months, the day which is three months (or a whole multiple thereof) after
the first day of such Interest Period and the last day of such Interest Period.
"INTEREST PERIOD" means with respect to any Eurodollar Loan:
(a) initially, the period commencing on, as the case may be, the
Documentation Date with respect to the Outstanding Loans, the Advance Date
or conversion date, as the case may be, with respect to such Eurodollar
Loan and ending one, two, three or six months thereafter as selected by the
Company in its Advance Request as provided in SECTION 2.4 of the
Participation Agreement or its notice of conversion as provided in SECTION
2.10 of the Participation Agreement; and
(b) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such Eurodollar Loan and ending
one, two, three or six months thereafter;
PROVIDED that all of the foregoing provisions relating to Interest Periods
are subject to the following:
(A) if any Interest Period pertaining to a Eurodollar Loan would otherwise
end on a day which is not a Business Day, that Interest Period shall be
extended to the next succeeding Business Day, unless the result of such
extension would be to carry such Interest Period into another calendar
month, in which event such Interest Period shall end on the immediately
preceding Business Day;
(B) any Interest Period that would otherwise extend beyond the Termination
Date or beyond the date final payment is due on the Loan shall end on the
Termination Date, or if the Termination Date shall not be a Business Day,
on the next preceding Business Day or on such date of final payment, as the
case may be;
(C) if the company shall fail to give notice as provided above in CLAUSE
(a), it shall be deemed to have selected a conversion of a Eurodollar Loan
into an ABR Loan (which conversion shall occur automatically and without
need for compliance with the conditions for conversion set forth in SECTION
2.10);
(D) any Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in
the calendar month at the end of such Interest Period) shall end on the
last Business Day of a calendar month; and
(E) the Company shall select Interest Periods so as not to require a
payment or prepayment of any Eurodollar Loan during an Interest Period for
such Loan.
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"INVESTED AMOUNT" means an amount equal to, without duplication, the
Outstanding Investor Balance PLUS the Documentation Date Prepayment Amount PLUS
the Commitment Percentage of each Advance attributable to Lessor and in the
aggregate not more than Lessor's Commitment set forth on SCHEDULE I.
"INVESTOR BALANCE" means the sum of all Invested Amounts on any given date
LESS any amounts applied in reduction thereof pursuant to the Operative
Documents.
"INVESTOR'S LETTER" has the meaning set forth in SECTION 6.3(b) of the
Participation Agreement.
"LEASE" means the Amended and Restated Lease, dated as of March 19, 2004,
between Lessor and Lessee, substantially in the form of EXHIBIT A and the Lease
Supplements.
"LEASE BALANCE" means, as of any date of determination, the sum of the
aggregate outstanding principal amount of the Notes PLUS the Investor Balance,
LESS any amounts applied pursuant to the Operative Documents in reduction of the
Lease Balance on such date.
"LEASE COMMENCEMENT DATE" means, as to the Original Property, the
Documentation Date and, as to the Additional Property, the Acquisition Date.
"LEASE DEFAULT" means any event, condition or failure which, with notice or
lapse of time or both, would become, a Lease Event of Default.
"LEASE EVENT OF DEFAULT" means any event, condition or failure designated
as a "Lease Event of Default" in Article XVII of the Lease.
"LEASE OBLIGATIONS" means of the Company and its Subsidiaries, as of the
date of any determination thereof, the rental commitments of the Company and its
Subsidiaries determined on a consolidated basis, if any, under leases for real
and/or personal property (net of rental commitments from sub-leases thereof),
excluding however, obligations under leases which are classified as Indebtedness
under clause (d) of the definition of Indebtedness.
"LEASE SUPPLEMENT" means Lease Supplement No.1 and Lease Supplement No. 2,
substantially in the form of Exhibit A to the Lease, delivered pursuant to
Section 2.2 of the Lease.
"LEASE TERM" has the meaning set forth in Section 2.3 of the Lease.
"LEASE TERMINATION DATE" means (i) the scheduled expiration of the Lease
Term, or (ii) If earlier, (a) the date of termination of Lessee's right to
possession due to the occurrence of a Lease Event of Default pursuant to Section
18.1 of the Lease, (b) with respect to a Property, the date of termination of
the Lease resulting from Lessee's exercise of its Purchase Option in respect of
such Property pursuant to Section 6.1 of the Lease or (c) with respect to a
Property, the date of termination of the Lease pursuant to Section 13.1(b) of
the Lease.
"LENDERS" means the holders of the Notes.
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"LESSEE" means the Company.
"LESSOR" means Credit Suisse Leasing 92A, L.P.
"LESSOR LIENS" means Liens on or against a Property, the Lease or any
payment of Rent (a) which result from any act of, or any Claim against, Lessor
unrelated to the transactions contemplated by the Operative Documents or (b)
which result from any tax owed by Lessor, except any Tax for which Lessee is
obligated to indemnify.
"LESSOR'S COST" means the sum of the Outstanding Funded Amount PLUS the
aggregate amount paid or advanced by Lessor on each Advance Date with respect to
the Properties PLUS all Transaction Costs paid by Lessor.
"LIABILITIES" is defined in Section 1 of the Guaranty.
"LIEN" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement, any Financing Lease having
substantially the same economic effect as any of the foregoing, and the filing
of any financing statement under the Uniform Commercial Code or comparable law
of any jurisdiction in respect of any of the foregoing except for the fixing of
financing statements in connection with Lease Obligations incurred by the
Company or its Subsidiaries to the extent that such financing statements relate
to the property subject to such Lease Obligations).
"LOANS" has the meaning set forth in Section 2.1 of the Loan Agreement.
"LOAN AGREEMENT" means the Amended and Restated Loan Agreement, dated as of
March 19, 2004, among Lessor and the Lenders, substantially in the form of
Exhibit C to the Participation Agreement.
"LOAN DEFAULT" means any event, condition or failure which, with notice or
lapse of time or both, would become a Loan Event of Default.
"LOAN DOCUMENTS" mean the Loan Agreement, the Notes, the Mortgage, the
Assignment of Lease, each Supplement to Assignment of Lease and all documents
and instruments executed and delivered in connection with each of the foregoing.
"LOAN EVENT OF DEFAULT" means any event, condition or failure designated as
a "Loan Event of Default" in Section 6.1 of the Loan Agreement.
"LOAN PARTICIPANT" has the meaning specified in SECTION 6.4(a) of the
Participation Agreement.
"LOSS PROCEEDS" means, with respect to any Property, all Net Condemnation
Proceeds and property insurance proceeds received at any time from any Authority
or other Person with respect to any Event of Loss involving such property.
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"MATERIAL ADVERSE EFFECT" means a material adverse effect on (i) the
business, operations, property, condition (financial or otherwise) or prospects
of the Company and its Subsidiaries, taken as a whole, (ii) the transactions
contemplated by the Operative Documents, (iii) the validity or enforceability of
any of the Operative Documents or (iv) any rights or remedies of the
Administrative Agent or the Lenders under any thereof.
"MATERIAL ENVIRONMENTAL AMOUNT" means an amount payable by the Lessee
and/or its Subsidiaries in excess of $10,000,000 for remedial costs, non-routine
compliance costs, compensatory damages, punitive damages, fines, penalties or
any combination thereof.
"MATERIAL SUBSIDIARY" means each Domestic Subsidiary of the Lessee which
has either (a) assets having a fair market value (as reasonably estimated by the
Lessee) or book value in excess of $10,000,000 in the aggregate or (b) revenues
in excess of $10,000,000 per annum, other than (x) Reebok Securities Holdings
Corp., during such time as its only material asset is capital stock of RBK
Holdings plc, (y) Avintco, Inc., during the period prior to the first
anniversary of the Documentation Date and (z) Reebok Foundation, Inc.
"MATURITY DATE" means the original Final Maturity Date or the date to which
such Final Maturity Date has been extended pursuant to SECTION 2.8 of the
Participation Agreement.
"MODIFICATIONS" has the meaning set forth in Section 9.2(a) of the Lease.
"MOODY'S" means Moody's Investors Service, Inc., or any successor thereto.
"MORTGAGE" means the amended and restated mortgage between Lessor and
Administrative Agent, and the amendment thereto, substantially in the form of
Exhibits E-1 and E-2, respectively, to the Participation Agreement.
"MULTIEMPLOYER PLAN" means a Plan which is a multiemployer plan as defined
in Section 4001 (a) (3) of ERISA.
"NET CONDEMNATION PROCEEDS" means, with respect to any Property, all
payments received from any Authority relating to an Event of Taking involving
such Property after deducting the costs incurred by Lessee, Administrative Agent
or any Participant in respect of the receipt thereof.
"NEW LENDERS" means those Lenders who are parties to the Participation
Agreement who were not Original Lenders under the Original Participation
Agreement.
"NEW PARTICIPANTS" means the New Lenders.
"NON-CONSENTING PARTICIPANT" has the meaning set forth in SECTION 2.8(a) of
the Participation Agreement.
"NONSEVERABLE" shall describe a Modification or part of a Modification of
which cannot be readily removed from a Property without causing material damage
to or materially impairing the value or utility of such Property.
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"NOTES" means the notes issued by the Borrower under the Loan Agreement and
denominated as such, substantially in the form of Exhibit A to the Loan
Agreement, and any and all Notes issued in replacement or exchange therefor in
accordance with the provisions thereof.
"OFFICER'S CERTIFICATE" of (a) a Person other than the Company, means a
certificate signed by the Chairman of the Board of Directors or the President or
any Executive Vice President or any Senior Vice President or any other Vice
President of such Person signing with the Treasurer or any Assistant Treasurer
or the Controller or any Assistant Controller or the Secretary or any Assistant
Secretary of such Person, or by any Vice President who is also Controller or
Treasurer signing alone and (b) the Company, means a certificate signed by a
Responsible Officer of the Company.
"OPERATIVE DOCUMENTS" means the Participation Agreement, the Lease, the
Lease Supplements, the Guaranty, the Loan Agreement, the Notes, the Mortgage,
the Assignment of Lease, the Supplements to Assignment of Lease, the Purchase
Agreement Assignment and the Environmental Indemnity.
"ORIGINAL DOCUMENTATION DATE" has the meaning set forth in the Recitals to
the Participation Agreement.
"ORIGINAL FACILITY" has the meaning set forth in the Recitals to the
Original Participation Agreement.
"ORIGINAL FINANCING" has the meaning set forth in the Recitals to the
Participation Agreement.
"ORIGINAL GUARANTY" means the Guaranty executed and delivered by Lessee for
the benefit of Lessor, Administrative Agent and the Original Lenders pursuant to
the Original Participation Agreement.
"ORIGINAL LAND" has the meaning set forth in the Recitals to the
Participation Agreement.
"ORIGINAL LEASE" means the Lease, dated as of March 27, 1998, between
Lessor and Lessee, pursuant to the Original Participation Agreement.
"ORIGINAL LENDERS" means the Lenders under the Original Participation
Agreement.
"ORIGINAL LOAN AGREEMENT" means the Loan Agreement among the Lessor and the
Lenders executed pursuant to the Original Participation Agreement.
"ORIGINAL LOANS" means the Loans advanced to Borrower by the Original
Lenders pursuant to the Original Loan Agreement.
"ORIGINAL MORTGAGE" means the Mortgage with respect to the Original
Property granted by Lessor to Administrative Agent pursuant to the Original
Participation Agreement.
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"ORIGINAL NOTES" means the Notes issued by Lessor pursuant to the Original
Loan Agreement.
"ORIGINAL OPERATIVE DOCUMENTS" means the "Operative Documents" as defined
in Appendix 1 to the Original Participation Agreement.
"ORIGINAL PARTICIPATION AGREEMENT" means the Participation Agreement, dated
as of March 27, 1998, among the Company, Lessor, the Original Lenders and the
Administrative Agent.
"ORIGINAL PROPERTY" means the Original Land, together with the Original
Facility.
"ORIGINAL PROPERTY APPRAISAL" has the meaning set forth in SECTION 3.1(p)
of the Participation Agreement.
"ORIGINAL PROPERTY COMMITMENT AMOUNT" shall mean $150,000,000.
"ORIGINAL PROPERTY LESSOR'S POLICY" has the meaning set forth in SECTION
3.1(k) of the Participation Agreement.
"ORIGINAL PROPERTY LOAN POLICY" has the meaning set forth in SECTION 3.1(k)
of the Participation Agreement.
"ORIGINAL PROPERTY TITLE POLICIES" has the meaning set forth in SECTION
3.1(k) of the Participation Agreement.
"OUTSTANDING FUNDED AMOUNT" means the sum of the Outstanding Investor
Balance plus the Outstanding Loan Balance.
"OUTSTANDING INVESTOR BALANCE" means the amount of the "Investor Balance"
outstanding under the Original Operative Documents on the Documentation Date.
"OUTSTANDING LOAN BALANCE" means the principal amount of the Loans
outstanding under the Original Operative Documents on the Documentation Date.
"OVERALL TRANSACTION" means all the transactions and activities referred to
in or contemplated by the Operative Documents.
"OVERDUE RATE" means the lesser of (i) in the case of Eurodollar Loans, (A)
until the end of the applicable Interest Period at a rate per annum of 2.00%
above the rate otherwise applicable to such Loans, and (B) thereafter in
accordance with the following clause (ii); and (ii) in the case of any other
amount due from Lessee under any of the Operative Documents, 2.00% above the
then current ABR plus the Applicable Margin.
"PARTICIPANTS" means the Lessor and the Lenders, collectively.
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"PARTICIPATION AGREEMENT" means the Amended and Restated Participation
Agreement dated as of March 19, 2004, among the Company, Lessor, Lenders and
Administrative Agent.
"PAYMENT DATE" means each Interest Payment Date, any date all or any
portion of the outstanding principal amount of the Loans are paid and the Lease
Termination Date.
"PBGC" means the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA.
"PERMITS" has the meaning set forth in SECTION 4.1(o) of the Participation
Agreement.
"PERMITTED CONTEST" means actions taken by a Person to contest in good
faith, by appropriate proceedings initiated timely and diligently prosecuted,
the legality, validity or applicability of: (a) any law, regulation, rule,
judgment, order, or other legal provision or judicial or administrative
requirements; (b) any term or condition of, or any revocation or amendment of,
or other proceeding relating to, any authorization or other consent, approval or
other action by, any Authority; or (c) any Lien or Tax; PROVIDED that the
initiation and prosecution of such contest would not: (i) result in, or
materially increase the risk of, the imposition of any criminal liability on any
Indemnitee; (ii) materially and adversely affect the Lien created by the
Operative Documents or the right, title or interest of Administrative Agent or
Lessor in or to the Property or the right of Administrative Agent or any
Participant to receive payment of the principal of or interest on any Note,
Investor Balance or Yield on any Investor Amount or Rent or the Lease Balance or
any interest therein; or (iii) materially and adversely affect the fair market
value, utility or remaining useful life of any Property or any interest therein
or the continued economic operation thereof; and PROVIDED FURTHER that in any
event adequate reserves in accordance with GAAP are maintained against any
adverse determination of such contest (with the determination of the adequacy of
reserves taking into account the availability of insurance from reputable
insurers).
"PERMITTED EXCEPTIONS" mean the exceptions set forth in the Title Policies,
which exceptions shall be satisfactory to counsel for the Administrative Agent
and the Lenders.
"PERMITTED INVESTMENTS" means (i) securities issued or directly and fully
guaranteed or insured by the United States Government or any agency or
instrumentality thereof having maturities of not more than twelve months from
the date of acquisition, (ii) certificates of deposit and eurodollar time
deposits with maturities of twelve months or less from the date of acquisition,
bankers' acceptances with maturities not exceeding twelve months and overnight
bank deposits, in each case with any Participant or with any domestic commercial
bank having capital and surplus in excess of $300,000,000, (iii) repurchase
obligations with a term of not more than seven days for underlying securities of
the types described in clauses (i) and (ii) entered into with any financial
institution meeting the qualifications specified in clause (ii) above, (iv)
commercial paper (x) issued by any Participant or the parent corporation of any
Participant, or (y) rated A-1 or the equivalent thereof by S&P or P-1 or the
equivalent thereof by Moody's and in each case maturing within twelve months
after the date of acquisition, and (v) shares of money market mutual funds or
similar funds which invest exclusively in assets satisfying the requirements of
clauses (i) through (iv) of this definition.
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"PERMITTED LIENS" means (a) the respective rights and interests of Lessee,
Lessor, Administrative Agent and the Lenders, as provided in the Operative
Documents, (b) Lessor Liens, (c) Liens for Taxes either not yet delinquent or
being contested by a Permitted Contest, (d) carriers', warehousemen's,
materialmen's, mechanics', workers', repairmen's, employees' or other like Liens
arising in the ordinary course of business for amounts either not overdue for a
period of more than 90 days or being contested by a Permitted Contest, (e) Liens
arising after an Advance Date out of judgments or awards with respect to which
at the time an appeal or proceeding for review is being prosecuted in good faith
and either have been bonded to the satisfaction of Administrative Agent or the
enforcement of such Lien has been stayed pending such appeal-or review, (f)
easements (including reciprocal easement agreements); rights-of-way, building,
zoning and similar restrictions, utility agreements, covenants, reservations,
restrictions, encroachments, changes, and other similar encumbrances or title
defects incurred in the ordinary course of business, which do not interfere with
or adversely affect, in any material respect the ordinary conduct of the
business of the Lessee of the Property and which do not impair the perfection of
the Lien of the Mortgage, (g) Permitted Exceptions, (h) the rights of any
sublessee under a sublease permitted by the terms of the Lease, (i) Liens of any
of the types referred to in CLAUSE (d) above that have been bonded for not less
than the full amount of such dispute (or for which security arrangements
reasonably satisfactory to the Administrative Agent have been made), which
bonding (or arrangements) shall comply with Applicable Laws, and has effectively
stayed any execution or enforcement of such Liens, (j) pledges or deposits in
connection with workers' compensation, unemployment insurance and other social
security legislation and deposits securing liability to insurance carriers under
insurance or self-insurance arrangements, and (k) deposits to secure the
performance of bids, trade contracts (other than for borrowed money), leases,
statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of business;
PROVIDED that such encumbrance is subordinate to the Mortgage or such developer,
landlord or other third party has executed and delivered a non-disturbance
agreement in form and substance satisfactory to the Administrative Agent.
"PERSON" means an individual, partnership, corporation, business trust,
joint stock company, trust, unincorporated association, joint venture, Authority
or other entity of whatever nature.
"PLAN" means any pension plan which is covered by Title IV of ERISA and in
respect of which the Company or a Commonly Controlled Entity is an "employer" as
defined in Section 3(5) of ERISA.
"PRIME RATE" means the rate of interest per annum publicly announced from
time to time by the Administrative Agent as its prime rate in effect at its
principal office in New York City.
"PROCEEDS" has the meaning specified in Section 6.3 of the Lease.
"PROHIBITED TRANSACTION" means a transaction that is prohibited under Code
Section 4975 or ERISA Section 406 and not exempt under Code Section 4975 or
ERISA Section 408.
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"PROPERTY" means, individually, the Original Property or the Additional
Property, and collectively, the Original Property and the Additional Property.
"PROPERTY BALANCE" means with respect to a Property an amount equal to the
outstanding principal amount of the Loans and Investor Balance related to such
Property, less any amounts applied pursuant to the Operative Documents in
reduction of such Property Balance on such date.
"PROPERTY PRINCIPAL AMOUNT" has the meaning specified in Section 2.4(b) of
the Loan Agreement.
"PURCHASE AGREEMENT" means the purchase agreement between the Seller of the
Additional Property and Lessee, in form and substance reasonably acceptable to
Administrative Agent and its counsel.
"PURCHASE AGREEMENT ASSIGNMENT" means a Purchase Agreement Assignment
between Lessee and Lessor and acknowledged by the Seller of the Additional
Property in form and substance satisfactory to Administrative Agent and its
counsel.
"PURCHASE OPTION" has the meaning set forth in Section 6.1 of the Lease.
"PURCHASE OPTION PRICE" has the meaning set forth in Section 6.1 of the
Lease.
"REAL ESTATE FINANCING" means any financing or financings in the nature of
Indebtedness secured by the interest in real property and/or equipment of the
Company and its Subsidiaries (other than any Indebtedness incurred hereunder)
and any refinancings of any of the foregoing. The Overall Transaction, and
liabilities and obligations incurred in connection therewith and the Lease,
shall be deemed not to be a Real Estate Financing.
"REEBOK U.K." means Reebok International Limited, a United Kingdom
Corporation.
"REFERENCE BANKS" means Credit Suisse First Boston, Fleet National Bank and
Wachovia Bank, N.A.
"REGULATED ACTIVITY" means the use, Release, generation, treatment,
storage, recycling, transportation or disposal of Hazardous Material to the
extent such activities are regulated by any Authority.
"REGULATIONS" mean the income tax regulations promulgated from time to time
under and pursuant to the Code.
"RELATED SALES EXPENSES" means all costs related to such sale and delivery,
including costs of sales agents, removal of improvements, delivery of documents,
filing and documentary transfer fees, title insurance, certification and testing
of the Property, legal costs, costs of notices, any advertisement or any other
similar cost or other information, all of which shall be borne entirely by
Lessee without regard to whether such costs were incurred by Lessor, the
Administrative Agent or any Lender. Lessee shall not pay Related Sales Expenses
from any of
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the Proceeds. Neither Lessor nor Administrative Agent shall have any
responsibility for procuring any buyer for the Property.
"RELEASE" means the release, deposit, disposal or leak of any Hazardous
Material into or upon or under any land or water or air, or otherwise into the
environment, including by means of burial, disposal, discharge, emission,
injection, spillage, leakage, seepage, leaching, dumping, pumping, pouring,
escaping, emptying, placement and the like.
"REMARKETING OPTION" has the meaning specified in Section 6.2 of the Lease.
"RENEWAL OPTION" has the meaning set forth in Section 2.4 of the Lease.
"RENEWAL TERM" has the meaning set forth in Section 2.4 of the Lease.
"RENEWAL TERM EXPIRATION DATE" means, with respect to the initial Renewal
Term, the fifth anniversary of the Base Term Expiration Date, and with respect
to any subsequent Renewal Term, the fifth anniversary of the immediately
preceding Renewal Term Expiration Date.
"RENT" means Basic Rent and Supplemental Rent, collectively.
"RENT INSTALLMENT PERIOD" means, with respect to the Lease, a period that
corresponds to each Interest Period.
"RENT PAYMENT DATE" means each Payment Date.
"REORGANIZATION" means with respect to a Multiemployer Plan, the condition
that such Plan is in reorganization as such term is, used in Section 424l of
ERISA.
"REPORTABLE EVENT" means any of the events- set forth in Section 4043(c) of
ERISA or the regulations thereunder.
"REQUIRED ENTITIES" means, as of the date of the determination, Lenders and
the Lessor having aggregate investments in the Overall Transaction (as measured
by the outstanding principal amount of the Loans then outstanding or the
Investor Balance, as applicable) equal to more than 50% of all such investments.
"REQUIREMENT OF LAW" means, as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law, treaty, role or regulation or determination of an
arbitrator or a court or other 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.
"RESPONSIBLE OFFICER" means (i) the chief executive officer, president,
executive vice president or the chief operating officer of the Company, or (ii)
with respect to financial matters, the chief financial officer or the treasurer,
or (iii) solely for purposes of signing Advance Requests, the Assistant
Treasurer or the manager of treasury services of the Company.
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"REVOLVING CREDIT AGREEMENT" means the Credit and Guarantee Agreement dated
as of June 3, 2002 among the Company, Reebok International Limited, Reebok
Finance Limited, the several banks and other financial institutions from time to
time parties thereto, several co-agents referenced therein, ABN AMRO Bank, N.V.,
BNP Paribas and Wachovia Bank, National Association as co-documentation agents
and Credit Suisse First Boston, as Administrative Agent.
"SALE DEPOSIT" has the meaning set forth in Section 6.2(c) of the Lease.
"SALE DEPOSIT ESCROW AGREEMENT" has the meaning set forth in Section 6.2(c)
of the Lease.
"S&P" means Standard & Poor's Rating Services, a division of The
McGraw-Hill Companies, Inc. or any successor thereto.
"SEC" means the United States Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933.
"SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934.
"SELLER" means Instron Corporation, the seller of the Additional Property.
"SINGLE EMPLOYER PLAN" means any Plan which is not a Multi-employer Plan.
"SUBLEASE" has the meaning specified in Article XII of the Lease.
"SUBSIDIARY" means as to any Person, a corporation, partnership or other
entity of which shares of stock or other ownership interests having ordinary
voting power (other than stock or such other ownership interests having such
power only by reason of the happening of a contingency) to elect a majority of
the board of directors or other managers of such corporation, partnership or
other entity are at the time owned directly or indirectly through one or more
intermediaries, or both, by such Person. A Subsidiary shall be deemed wholly
owned by a Person of such Person owns all of the shares of stock or other
ownership interests having ordinary voting power (other than stock or such other
ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of
such Subsidiary; PROVIDED that (during such time as common stock of the Company
constitutes its only material asset) RBK Holdings plc shall be deemed not to
constitute a Subsidiary of the Company for any purpose hereunder, other than for
purposes of (a) calculation of financial covenants and (b) presentation of
financial statements. Unless otherwise qualified, all references to a
"Subsidiary" or to "Subsidiaries" in this Agreement shall refer to a Subsidiary
or Subsidiaries of the Company.
"SUBTENANT" has the meaning set forth in Article XII of the Lease.
"SUPPLEMENT TO ASSIGNMENT OF LEASE" means the "Supplement" entered into by
Lessor for the benefit of the Administrative Agent pursuant to the Assignment of
Lease.
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"SUPPLEMENTAL RENT" means any and all amounts, liabilities and obligations
other than Basic Rent which Lessee assumes or agrees or is otherwise obligated
or designated to pay under the Lease or any other Operative Document (whether or
not designated as Supplemental Rent) to any Agent, the Lenders, the Indemnitees
or any other Person, including Additional Costs (other than Additional Costs and
expenses incurred by the Lenders in connection with a Loan Event of Default
where no Lease Event of Default then exists), amounts under Article XIX of the
Lease and indemnities and damages for breach of any covenants, representations,
warranties or agreements, but excluding payments to Persons, other than any
Agent, the Lenders and the Indemnitees pursuant to leases, reciprocal easement
agreements and other agreements with respect to the Property for which Lessee is
obligated or designated to pay.
"TAXES" and "TAX" mean any and all fees (including documentation,
recording, license and registration fees), taxes (including income (whether net,
gross or adjusted gross), financial institutions, franchise, gross receipts,
sales, rental, use, turnover, value-added, property, excise and stamp taxes),
levies, imposts, duties, charges, assessments or withholdings of any nature
whatsoever, together with any penalties, fines or interest thereon or additions
thereto.
"TERMINATION DATE" means the Base Term Expiration Date or the last
scheduled date of a Renewal Term then in effect, in each case where no
succeeding Renewal Term has been agreed upon pursuant to SECTION 2.8 of the
Participation Agreement.
"TITLE INSURANCE COMPANY" means Lawyers Title Insurance Corporation and its
successors and assigns.
"TITLE POLICIES" means the Original Property Title Policies and the
Additional Property Title Policies.
"TRANCHE A LOANS" has the meaning set forth in Section 2.2 of the Loan
Agreement.
"TRANCHE B LOANS" has the meaning set forth in Section 2.2 of the Loan
Agreement.
"TRANSACTION COSTS" means transaction costs and expenses incurred by the
Arranger, Lessee, with the consent of the Administrative Agent, Lessor,
Administrative Agent and the Lenders in connection with the consummation of the
transactions contemplated by the Operative Documents, Purchase Agreement and
Additional Property Sublease and the preparation, negotiation, execution and
delivery of the Operative Documents, including (1) the reasonable fees and
expenses of McGuireWoods LLP, special counsel to the Lessor; (2) the reasonable
fees and expenses of counsel to Lessee; (3) all appraisal fees and reasonable
expenses, including the cost of an appraisal obtained by Lessor with respect to
a Property upon a Lease Default or Lease Event of Default; (4) all recording and
filing fees incurred in connection with the recording or filing of the Lease,
the Lease Supplements, the Assignment of Lease, the Supplements to Assignment of
Lease and the Mortgage, including fees, title insurance premiums and other
expenses of the Title Insurance Company; (5) all costs and expenses of each
company engaged to survey each Property; (6) all costs and expenses of the
preparation of the Environmental Audit; (7) all fees, costs and expenses of
Administrative Agent; (8) the fees incurred by Lessor to purchase residual value
insurance; and (9) the Arrangement Fee.
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"TYPE" means, as to any Loan, its nature as an ABR Loan or a Eurodollar
Loan.
"UCC" means the Uniform Commercial Code of New York or any other applicable
jurisdiction.
"WHOLLY-OWNED DOMESTIC SUBSIDIARY" of any Person means a Domestic
Subsidiary of such Person all of the outstanding capital stock or other
ownership interests of which shall at the time be owned by such Person or by one
or more Wholly-owned Domestic Subsidiaries of such Person or any such Person and
one or more Wholly-owned Domestic Subsidiaries of such Person.
"WHOLLY-OWNED SUBSIDIARY" of any Person means a Subsidiary of such Person
all of the outstanding capital stock or other ownership interests of which shall
at the time be owned by such Person or by one or more Wholly-owned Subsidiaries
of such Person or any such Person and one or more Wholly-owned Subsidiaries of
such Person.
"YIELD" means, with respect to each Interest Period, (a) the Yield Rate for
such Interest Period multiplied by (b) the outstanding Investor Balance.
"YIELD RATE" with respect to each Interest Period, the applicable rate at
which Yield shall accrue and be payable from time to time on the Investor
Balance, which rate shall be the rate per annum equal to the sum of (i) the
Eurodollar Rate for such Interest Period plus (ii) 255 basis points.
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