UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): DECEMBER 9, 1997
THE VINCAM GROUP, INC.
(Exact name of registrant as specified in its charter)
FLORIDA 0-28148 59-2452823
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation or organization) Identification No.)
2850 DOUGLAS ROAD, CORAL GABLES, FLORIDA 33134
(Address of principal executive offices) (Zip Code)
(305) 460-2350
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name, former address, and former fiscal year, if changed since last
report)
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ITEM 5. OTHER EVENTS
On December 9, 1997, The Vincam Group, Inc. ("Vincam" or the "Company")
entered into financing and leasing arrangements with respect to a new
headquarters facility of approximately 90,000 square feet that the Company
expects will be completed in the summer of 1998. The new headquarters facility
will be situated on 8 1/2 acres of land in unincorporated Miami-Dade County on
the corner of SW 72nd Street and 102nd Ave.
Fleet Real Estate, Inc. ("Fleet Real Estate") owns the property and
will own the headquarters facility, which is to be developed under a development
agreement between Vincam and Codina Development Corporation. Vincam has entered
into a triple net lease with Fleet Real Estate which has an initial expiration
date of four years after completion of the facility and allows Vincam to extend
the term of the lease for up to three years. Fleet Real Estate has financed 97%
of the costs of acquiring the land and constructing the facility with Fleet
National Bank, as agent, and Fleet Real Estate Capital, Inc., NationsBank, N.A.
(South) and SunTrust Bank, Miami, N.A. (the "Lenders"). All but Fleet Estate
Capital, Inc. are lenders under Vincam's current credit facility. Fleet Real
Estate's obligations to the Lenders are secured by a mortgage on the property
and the guarantees of Vincam and each of its subsidiaries of substantially all
of such obligations. The lease will be treated as an operating lease for
accounting purposes.
Under the lease, Vincam is obligated to make lease payments equal to
(i) interest at a competitive rate on all outstanding loan amounts with respect
to the facility plus (ii) the yield, at a competitive rate, in respect of Fleet
Real Estate's 3% equity investment. Interest and yield accruing during the
construction period will be capitalized. Under the financing arrangements, the
maximum amount funded by Fleet Real Estate and the Lenders is limited to $12
million. As of December 9, 1997, an aggregate of $3.5 million in loans were
outstanding which financed the $2.55 million purchase price of the land and
certain development and closing costs.
Vincam has an option to purchase the headquarters facility at any time
for an amount equal to the total of (i) the amount of loans from the Lenders
outstanding with respect to the property, (ii) Fleet Real Estate's investment in
the facility, (iii) any accrued and unpaid interest on outstanding loans from
the Lenders, and (iv) all accrued and unpaid yield on Fleet Real Estate's equity
investment (the "Purchase Price"). If Vincam determines not to purchase the
facility, it will be required to make a termination payment at the end of the
lease term equal to approximately 85% of the Purchase Price. Vincam's lease
payment obligations are secured by a pledge of all of the stock of its
subsidiaries.
Statements in this Form 8-K relating to matters that are not historical
facts are forward- looking statements. Such forward-looking statements involve
known and unknown risks, uncertainties and other factors, which may cause the
actual results, performances or achievements of The Vincam Group, Inc., to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such known and unknown
risks, uncertainties and other factors include, but are not limited to, the
following: (i) potential for
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unfavorable interpretation of government regulations relating to labor, taxes,
insurance, employment matters and the provision of managed care services; (ii)
the Company's ability to obtain or maintain all required licenses or
certifications required to further expand the range of specialized managed care
services offered by the Company; (iii) potential increases in the Company's
costs, such as health care costs, that the Company may not be able to reflect
immediately in its service fees; (iv) the Company's ability to offer its
services to prospective clients in additional states where it has less or no
market penetration; (v) the level of acquisition opportunities available to the
Company and the Company's ability to efficiently price and negotiate such
acquisitions on a favorable basis; (vi) the financial condition of the Company's
clients; (vii) additional regulatory requirements affecting the Company; (viii)
the impact of competition from existing and new professional employer
organizations; (ix) the failure to properly manage growth and successfully
integrate acquired companies and operations, and to achieve synergies and other
cost savings in the operation of acquired companies; and (x) other factors which
are described in further detail in the Company's filings with the Securities and
Exchange Commission.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements of Businesses Acquired
None
(b) Pro Forma Financial Information
None
(c) Exhibits
EXHIBIT NO. DESCRIPTION
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10.1 *Credit and Investment
Agreement, dated as of
December 9, 1997 by and
among The Vincam Group,
Inc., Fleet Real Estate,
Inc., Fleet National Bank
and the lenders signatories
thereto (including Schedule
1.02 thereto).
10.2 Lease Agreement, dated as of December 9, 1997
between Fleet Real Estate, Inc. and The Vincam
Group, Inc.
10.3 Guaranty dated as of December 9, 1997 of The Vincam
Group, Inc. in favor of Fleet National Bank, as agent
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10.4 Mortgage, Assignment of Leases and Security
Agreement dated as of December 9, 1997 by and
between Fleet Real Estate, Inc., The Vincam Group,
Inc. and Fleet National Bank.
10.5 Guaranty dated as of December 9, 1997 by Vincam
Human Resources, Inc., Vincam Human Resources,
Inc. I, Vincam Human Resources, Inc. II, Vincam
Human Resources, Inc. III, Vincam Human Resources,
Inc. IV, Vincam Human Resources, Inc. V, Vincam
Human Resources, Inc. VI, Vincam Human Resources,
Inc. XII, Vincam Human Resources of Michigan, Inc.,
Vincam Occupational Health Systems, Inc., Personnel
Resources, Inc., Vincam Insurance Services, Inc.,
Vincam Practice Management, Inc., American
Pediatric Systems, Inc, Psych/Care, Inc., Vincam/Staff
Administrators, Inc., Vincam/Staff Administrators of
Western Colorado, Inc., Staff Administrators of CO,
Inc., Staff Administrators of California, Inc.,
Vincam/Amstaff, Inc., RDM, Inc., Amstaff PEO, Inc.,
American Staffing , Inc. and Vincam/Staffing
Network, Inc. in favor of Fleet Real Estate, Inc.,
and its successors and assigns, including Fleet
National Bank, as Agent.
10.6 *Development Agreement, dated as of September 12,
1997, by and between Codina Development
Corporation and The Vincam Group, Inc.
*Schedules and exhibits to Exhibits 10.1 and 10.6 (other than Schedule
1.02 to Exhibit 10.1) have not been filed with the Securities and
Exchange Commission (the "Commission"). The Registrant agrees to
provide those schedules and exhibits supplementally upon the request of
the Commission.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
THE VINCAM GROUP, INC.
Date: December 19, 1997 By: /S/ CARLOS A. RODRIGUEZ
-------------------------------------
Carlos A. Rodriguez, Chief Financial
Officer and Senior Vice President
(Principal Financial Officer)
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EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
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10.1 *Credit and Investment Agreement, dated as of
December 9, 1997 by and among The Vincam Group, Inc.,
Fleet Real Estate, Inc., Fleet National Bank and the
lenders signatories thereto (including Schedule 1.02
thereto).
10.2 Lease Agreement, dated as of December 9, 1997 between
Fleet Real Estate, Inc. and The Vincam Group, Inc
10.3 Guaranty dated as of December 9, 1997 of The
Vincam Group, Inc. in favor of Fleet National Bank,
as agent
10.4 Mortgage, Assignment of Leases and Security
Agreement dated as of December 9, 1997 by and between
Fleet Real Estate, Inc., The Vincam
Group, Inc. and Fleet National Bank.
10.5 Guaranty dated as of December 9, 1997 by Vincam Human
Resources, Inc., Vincam Human Resources, Inc. I,
Vincam Human Resources, Inc. II, Vincam Human
Resources, Inc. III, Vincam Human Resources, Inc. IV,
Vincam Human Resources, Inc. V, Vincam Human
Resources, Inc. VI, Vincam Human Resources, Inc. XII,
Vincam Human Resources of Michigan, Inc., Vincam
Occupational Health Systems, Inc., Personnel
Resources, Inc., Vincam Insurance Services, Inc.,
Vincam Practice Management, Inc., American Pediatric
Systems, Inc, Psych/Care, Inc., Vincam/Staff
Administrators, Inc., Vincam/Staff Administrators of
Western Colorado, Inc., Staff Administrators of CO,
Inc., Staff Administrators of California, Inc.,
Vincam/Amstaff, Inc., RDM, Inc., Amstaff PEO, Inc.,
American Staffing , Inc. and Vincam/Staffing Network,
Inc. in favor of Fleet Real Estate, Inc., and its
successors and assigns, including Fleet National
Bank, as Agent.
10.6 *Development Agreement, dated as of September 12,
1997, by and between Codina Development Corporation
and The Vincam Group, Inc.
*Schedules and exhibits to Exhibits 10.1 and 10.6 (other than Schedule 1.02 to
Exhibit 10.1) have not been filed with the Securities and Exchange Commission
(the "Commission"). The Registrant agrees to provide those schedules and
exhibits supplementally upon the request of the Commission.
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EXHIBIT 10.1
CREDIT AND INVESTMENT AGREEMENT
Dated as of December 9, 1997
Among
THE VINCAM GROUP, INC.,
as Company,
FLEET REAL ESTATE, INC.,
as Lessor
FLEET NATIONAL BANK,
as Agent,
and
THE LENDERS SIGNATORIES HERETO
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TABLE OF CONTENTS
ARTICLE I
Defined Terms and Accounting Matters..........................2
Section 1.01 Terms Defined Above............................................2
Section 1.02 Certain Defined Terms..........................................2
Section 1.03 Accounting Terms and Determinations............................2
ARTICLE II
Commitments................................2
Section 2.01 Loans; Lessor Investment Payments..............................2
Section 2.02 Fundings.......................................................4
Section 2.03 Changes of Commitments.........................................5
Section 2.04 Fees...........................................................6
Section 2.05 Notes..........................................................6
Section 2.06 Several Obligations............................................6
Section 2.07 Applicable Funding Offices.....................................7
Section 2.09 Extension of Notes.............................................7
ARTICLE III
Payment of Loans and Lessor Investment Payments;
Payment of Interest, Yield and Other Amounts.................8
Section 3.01 Repayment of the Notes and Redemption of Lessor
Investment.....................................................8
Section 3.02 Prepayments and Redemptions....................................8
Section 3.03 Interest on Notes; Yield on Lessor Investment;
Overdue Amounts................................................9
Section 3.04 Payments by Lessor............................................11
Section 3.05 Applications of Payments and Proceeds.........................11
ARTICLE IV
Payments; Computations; Etc.........................13
Section 4.01 Payments......................................................13
Section 4.02 Pro Rata Treatment............................................14
Section 4.03 Computations..................................................14
Section 4.04 Non-receipt of Funds by the Agent.............................15
Section 4.05 Sharing of Payments...........................................15
Section 4.06 Taxes.........................................................16
ARTICLE V
Yield Protection and Illegality.....................18
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Section 5.01 Basis for Determining Interest Rate Inadequate or
Unfair........................................................18
Section 5.02 Illegality....................................................19
Section 5.03 Increased Cost and Reduced Return.............................21
Section 5.04 Base Rate Substituted for Adjusted LIBO Rate..................23
Section 5.05 Compensation..................................................24
Section 5.06 Payments and Computations.....................................24
ARTICLE VI
Conditions Precedent..........................25
Section 6.01 Conditions Precedent to Effectiveness of this
Agreement.....................................................25
Section 6.02 Initial and Subsequent Loans and Lessor Investment
Payments......................................................27
Section 6.03 Conditions Precedent for the Benefit of Lenders and
the Lessor....................................................28
Section 6.04 Closing.......................................................29
ARTICLE VII
Representations and Warranties....................29
Section 7.01 Company Representations and Warranties........................29
Section 7.02 Representations and Warranties of Lessor......................35
ARTICLE VIII
Covenants................................36
Section 8.01 Information...................................................37
Section 8.02 Notice of Default, Loss Event or Casualty
Occurrence....................................................38
Section 8.03 Inspection of Property, Books and Records.....................38
Section 8.04 Conduct of Business; Maintenance of Existence.................39
Section 8.05 Dissolution...................................................39
Section 8.06 Use of Proceeds...............................................39
Section 8.07 Compliance with Laws; Payment of Taxes........................39
Section 8.08 Insurance.....................................................40
Section 8.09 Maintenance of Property.......................................41
Section 8.10 Environmental Notices.........................................41
Section 8.11 Environmental Matters.........................................41
Section 8.12 Environmental Release.........................................41
Section 8.13 Consolidations, Merger or Acquisition.........................42
Section 8.14 Disposition of Assets.........................................43
Section 8.15 Liens, Etc....................................................43
Section 8.16 Restricted Payments...........................................43
Section 8.17 Investments...................................................43
Section 8.18 Indebtedness..................................................44
Section 8.19 Guarantees....................................................45
Section 8.20 Debt Coverage.................................................46
Section 8.21 Fixed Charges Coverage........................................46
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Section 8.22 Capital Ratio.................................................46
Section 8.23 Current Ratio.................................................46
Section 8.24 Minimum Tangible Net Worth....................................46
Section 8.25 Related Contracts.............................................46
Section 8.26 Transactions with Affiliates..................................46
Section 8.27 Agreement to Pledge, Etc......................................47
Section 8.28 Further Assurances............................................47
Section 8.29 Completion; Etc...............................................47
Section 8.30 Maintenance; Etc..............................................47
Section 8.31 Encroachments.................................................48
Section 8.32 Facility Plan.................................................48
Section 8.33 New Subsidiaries to Become Guarantors.........................48
Section 8.34 Covenants of Lessor...........................................49
ARTICLE IX
Events of Default............................49
Section 9.01 Events of Default.............................................49
Section 9.02 Remedies......................................................52
ARTICLE X
The Agent...............................53
Section 10.01 Appointment, Powers and Immunities...........................53
Section 10.02 Reliance by Agent............................................53
Section 10.03 Defaults.....................................................54
Section 10.04 Rights as a Lender...........................................55
Section 10.05 Indemnification..............................................55
Section 10.06 Non-Reliance on Agent and other Lenders......................55
Section 10.07 Failure to Act...............................................56
Section 10.08 Resignation or Removal of Agent..............................56
ARTICLE XI
Miscellaneous..............................56
Section 11.01 Amendments, Etc..............................................56
Section 11.02 Notices......................................................57
Section 11.03 Payment of Expenses, Indemnities, etc........................58
Section 11.04 No Waiver; Remedies..........................................63
Section 11.05 Right of Set-Off.............................................63
Section 11.06 Assignments and Participations...............................63
Section 11.07 Invalidity...................................................67
Section 11.08 Entire Agreement.............................................67
Section 11.09 References...................................................67
Section 11.10 Successors; Survivals........................................67
Section 11.11 Captions.....................................................67
Section 11.12 Counterparts.................................................68
Section 11.13 Confidentiality..............................................68
Section 11.14 GOVERNING LAW; SUBMISSION TO JURISDICTION....................68
Section 11.15 Interest.....................................................69
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Section 11.16 Characterization.............................................71
Section 11.17 Compliance...................................................72
Section 11.18 Facility.....................................................72
Section 11.19 The Lessor...................................................72
Section 11.20 Lenders......................................................73
Section 11.21 Waiver of Jury Trial.........................................73
EXHIBITS
Exhibit A - Legal Description of Site
Exhibit B - Form of Tranche A Note
Exhibit C - Form of Tranche B Note
Exhibit D - Form of Assignment and Acceptance Agreement
Exhibit E - Loan Percentage Shares
Exhibit F - Form of legal opinion of counsel to the Company
and the Guarantors
Exhibit G - Form of Contribution Agreement
Exhibit H - Form of Compliance Certificate
Exhibit I - Form of Guaranty (Lessee)
Exhibit J - Form of Advance Notice
SCHEDULES
Schedule 1.02 - Defined Terms
Schedule 1.02(a) - Facility Plan and List of Facility Plan
Documents
Schedule 1.02(b) - Requirements for Completion
Schedule 1.02(c) - Pricing Schedule
Schedule A - General Disclosure
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CREDIT AND INVESTMENT AGREEMENT (as the same may be amended,
modified or supplemented from time to time, this "AGREEMENT" or the "CREDIT
AGREEMENT") dated as of December 9, 1997 among The Vincam Group, Inc. (the
"COMPANY"), Fleet Real Estate, Inc., a Rhode Island corporation (the "LESSOR");
each of the Lenders that is a party hereto or becomes a party hereto as provided
in Section 11.06 (individually, together with its successors and assigns, a
"LENDER," and collectively, together with their successors and assigns, the
"LENDERS"); and FLEET NATIONAL BANK, a national banking association (in its
individual capacity, "FLEET BANK "), as agent for the Lenders (in such capacity,
together with its successors in such capacity, the "AGENT").
RECITALS
WHEREAS, the Lessor has purchased, as of the date hereof, certain real
property located in Dade County, Florida, described in greater detail on EXHIBIT
A (the "SITE"), and intends to construct on the Site a building and related
enhancements and improvements; and
WHEREAS, the Lessor has leased the Site, and the building and other
enhancements and improvements thereon, after completion, to the Company pursuant
to the Lease; and
WHEREAS, the Company, acting as the Lessor's Acquisition/Construction
Agent under an the Agency Agreement, will, on behalf of the Lessor, complete the
construction and installation of all such enhancements and improvements on the
Site and provide operations, maintenance and management support; and
WHEREAS, in order to finance the acquisition of the Lessor's fee simple
estate in the Site, and the construction of the building and related
enhancements and improvements on the Site for the ultimate use and benefit of
the Company in accordance with the Lease, the Company has requested that the
Lenders extend certain loans to the Lessor in an aggregate principal amount of
up to $11,640,000, and that the Lessor make certain Lessor Investment Payments
in an aggregate principal amount of up to $360,000; and
WHEREAS, to induce the Lessor, the Agent and the Lenders to enter into
this Agreement and other agreements relating to the transactions contemplated
hereby, the Guarantors have agreed to guarantee the obligations of the Company
to the Lessor and certain of the obligations of the Lessor under this Agreement
to the Lenders and the Lessor under the Transaction Documents;
WHEREAS, the Lenders have agreed to extend the requested Loans and the
Lessor has agreed to make the requested Lessor
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Investment Payments upon the terms and conditions set forth
herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
ARTICLE I
Defined Terms and Accounting Matters
Section 1.01 TERMS DEFINED ABOVE. As used in this Agreement,
the terms defined in the preamble and recitals above shall have the meanings
indicated above.
Section 1.02 CERTAIN DEFINED TERMS. As used herein, all
capitalized terms used but not otherwise defined herein shall have the meaning
specified for such term in SCHEDULE 1.02.
Section 1.03 ACCOUNTING TERMS AND DETERMINATIONS. Unless
otherwise specified herein, all accounting terms used- herein shall be
interpreted, all determinations with respect to accounting matters hereunder
shall be made, and all financial statements and certificates and reports as to
financial matters required to be delivered hereunder shall be prepared, in
accordance with GAAP; PROVIDED that if any change in GAAP in itself materially
affects the calculation of any financial covenant in this Agreement, the Company
may by notice to the Agent, or the Agent may by notice to the Company, require
that such covenant thereafter be calculated in accordance with GAAP as in
effect, and applied by the Company, immediately before such change in GAAP
occurs. If such notice is given, the Compliance Certificates delivered pursuant
to Section 8.01(c) after such change occurs shall be accompanied by
reconciliations of the difference between the calculation set forth therein and
a calculation made in accordance with GAAP as in effect from time to time after
such change occurs.
ARTICLE II
Commitments
Section 2.01 LOANS; LESSOR INVESTMENT PAYMENTS.
(a) LOANS. Each Lender severally agrees, on the terms and
conditions of this Agreement, to make Tranche A Loans and Tranche B Loans to the
Lessor during the period from and including the later of (y) the Initial Funding
Date or (z) the date that such Lender becomes a party to this Agreement as
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provided in Section 11.06(b), up to and including the Completion Date, in an
aggregate principal amount at any one time outstanding up to but not exceeding
the amount of such Lender's Loan Percentage Share of the Aggregate Tranche A
Loan Commitments and Aggregate Tranche B Loan Commitments, respectively;
PROVIDED, HOWEVER, that the aggregate principal amount of all Loans by all
Lenders under this Section 2.01(a) at any one time outstanding shall not exceed
the lesser of (y) ninety-seven percent (97%) of the Facility Cost as incurred or
invoiced or (z) the Aggregate Loan Commitments. All Loans shall be utilized only
for items of Facility Cost, which utilization shall be evidenced to each
Lender's satisfaction simultaneously with and as a condition to each Loan. All
Loans and all Borrowings shall be made so as to satisfy the Required Percentage
Composition.
(b) LESSOR INVESTMENT PAYMENTS. The Lessor agrees, on the
terms and conditions of this Agreement, to fund a portion of the Facility Cost
by making Lessor Investment Payments during the period from and including the
Initial Funding Date up to and including the Completion Date, in an aggregate
amount equal to Lessor Investment Commitment.
(c) LIMITATIONS ON LOANS AND LESSOR INVESTMENT PAYMENTS. The
aggregate amount of all Lessor Investment Payments shall not exceed the amount
of the Lessor Investment Commitment and the aggregate amount of all Tranche A
Loans and Tranche B Loans shall not exceed the amount of the Aggregate Tranche A
Loan Commitments and Aggregate Tranche B Loan Commitments, respectively, or the
Aggregate Loan Commitments. Loans repaid may not be reborrowed. Lessor
Investment Payments repaid may not be readvanced. All Loans and Borrowings and
Lessor Investment Payments shall be made in such manner so as to satisfy the
Required Percentage Composition. All loans and Lessor Investment Payments shall
be utilized only for items of Facility Cost, which utilization shall be
evidenced or certified to the Agent's or the Lessor's reasonable satisfaction
simultaneously with and as a condition to each Loan or Lessor Investment Payment
as provided herein.
(d) CAPITALIZED INTEREST, YIELD, ETC.
(i) Prior to the Completion Date, all interest and other
amounts (other than Accrued Construction Term Yield) payable by the
Lessor under this Agreement shall be paid by the Borrowing of Loans and
the application of the proceeds of the Lessor Investment Payments. The
Company, as Acquisition/Construction Agent for the Lessor, shall give
Advance Notice in connection with any Loan made to pay such amounts or
of the amount of Lessor Investment Payments to be applied thereto.
Notwithstanding the foregoing, the aggregate amount of all Loans and
Lessor Investment Payments shall not exceed the Facility Cost.
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(ii) All Accrued Construction Term Yield shall be due and
payable as provided in Section 3.03(c).
Section 2.02 FUNDINGS.
(a) The Company, as Acquisition/Construction Agent for the
Lessor, from time to time as the Company may determine in accordance with this
Agreement and the Agency Agreement, shall give the Agent (which shall promptly
notify the Lenders and/or the Lessor, as applicable) Advance Notice in
substantially the form of EXHIBIT J (which may be telephonic if confirmed
promptly in writing) of each requested funding of a Loan or a Lessor Investment
Payment, which notice shall be irrevocable and effective only upon receipt by
the Agent, and shall specify the aggregate amount and the date of the Loans
and/or Lessor Investment Payments to be funded. Once given, an Advance Notice
may be revoked only upon payment of any amounts due to the Lenders or the Lessor
under section 5.05. The Advance Notice given with respect to the Initial Funding
Date shall, in addition to any Loans requested, request Lessor Investment
Payments in such amount as is necessary to cause the Required Percentage
Composition to be satisfied on such date. Not later than 1:00 p.m., prevailing
Eastern time, on the date specified for each funding hereunder, each Lender and
the Lessor shall make available the amount of the Loan and/or Lessor Investment
Payment to be made by it on such date at an account which the Agent shall
specify, in immediately available funds, for the account of the Lessor. The
amounts so received by the Agent shall, subject to the terms and conditions of
this Agreement, be made available to the Company as Acquisition/Construction
Agent for the Lessor by depositing the same, in immediately available funds, in
an account of the Company designated by the Lessor and maintained with the Agent
at its Principal Office, not later than 4:30 p.m. on the date of requested
Borrowing or Lessor Investment Payment. There shall be no more than two
Borrowings of Loans per calendar month.
(b) All Borrowings under Section 2.02(a) shall be in amounts
of at least $50,000 or in integral multiples of $10,000 in excess thereof, or
the remaining balance of the Aggregate Loan Commitments, if less.
(c) On the Completion Date, all Loans and Lessor Investment
Payments shall have been funded by the Lenders and the Lessor as herein provided
on a pro rata basis so that the Required Percentage Composition shall be
satisfied on such date. On the Completion Date (subject to the terms of Section
2.09), if the Lessor Investment Payments exceed 3% of the aggregate principal
amount of all Loans and Lessor Investment Payments, the Company, as
Acquisition/Construction Agent for the Lessor, shall either (i) subject to the
other terms and conditions of this Agreement, borrow Loans from the Lenders
and/or (ii) repay the excess amount of Lessor Investment Payments, such that, in
either
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case, after giving effect to such Loans or repayment, the Required Percentage
Composition shall be satisfied on such date. In addition, on the Completion
Date, if the aggregate principal amount of all Loans and Lessor Investment
Payments exceeds the Completion Date Appraised Amount (the amount of such excess
being the "Excess Amount Funded"), the Company, as Acquisition/Construction
Agent for the Lessor, shall deposit with the Agent cash or cash equivalents
satisfactory to the Agent in an aggregate amount equal to the Excess Amount
Funded, as cash collateral (the "Cash Collateral"), to secure the Loans and
Lessor Investments, and all interest, Yield, fees, expenses, indemnification
amounts and other amounts owed by the Lessee to the Lessor, or by the Lessor to
the Agents and the Lenders, pursuant to the Transaction Documents (collectively,
the "Transaction Obligations". The Cash Collateral shall be held by the Agent in
an interest bearing account, as security for the Transaction Obligations. So
long as no Event of Default has occurred, the accrued interest on the Cash
Collateral shall be paid to the Lessee by the Agent on the first Business Day of
each calendar month. Upon an Event of Default, the Agent shall have the right to
apply the Cash Collateral in payment of the Transaction Obligations in the order
provided in Section 3.05(b). Under the circumstances described in Section
3.05(a), the Cash Collateral may be used in paying the amounts described therein
in the order set forth therein.
Section 2.03 CHANGES OF COMMITMENTS. The Company, as
Acquisition/Construction Agent for the Lessor, shall have the right to terminate
or to reduce the amount of, or, prior to utilization thereof, terminate, the
Aggregate Loan Commitments and the Lessor Investment Commitment, at any time or
from time to time upon not less than three (3) Business Days prior written
notice to the Agent (which shall promptly notify the Lenders and the Lessor) of
each such termination or reduction, which notice shall specify the effective
date thereof and the amount of any such reduction (which shall not be less than
$1,000,000 or any multiple of $250,000 in excess thereof, with respect to the
Aggregate Loan Commitments) and shall be irrevocable and effective only upon
receipt by the Agent. Any request for a reduction in the amount of the
Commitments shall be pro rata among the Aggregate Loan Commitments and the
Lessor Investment Commitment so that, at all times, 3% of the Aggregate
Commitments will be comprised of the Lessor Investment Commitment and 97% of the
Aggregate Commitments will be comprised of the Aggregate Loan Commitments. The
Aggregate Loan Commitments and the Lessor Investment Commitment once terminated
or reduced may not be reinstated. In no event shall the Lessor Investment
Commitment be reduced below the outstanding principal amount of Lessor
Investment Payments, nor shall the Aggregate Loan Commitments be reduced below
the aggregate outstanding principal amount of the Loans. The Company may elect
to repay, pro rata, the Lessor Investment sufficient to maintain the Required
Percentage Composition and/or to give effect to any proposed reduction of the
Commitments.
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Section 2.04 FEES.
(a) The Company shall pay, or cause to be paid, from the
proceeds of Loans or the application of Lessor Investment Payments, or
otherwise, on the Closing Date to the Agent for the ratable account of the
Lenders in accordance with the Lessor Investment Commitment, an upfront fee in
the amount of $30,000.
(b) The Company shall pay, or cause to be paid, from the
proceeds of Loans or the application of Lessor Investment Payments, on the dates
specified therein (i) to the Agent for the Agent's account and (ii) to the
Lessor for the Lessor's account, the fees payable on the Closing Date as
specified in the fee letter dated August 25, 1997 between the Lessor and the
Lessee, as amended by the amendment letter dated as of November 20, 1997.
Section 2.05 NOTES.
(a) The Tranche A Loans made by each Lender under Section
2.01(a) shall be evidenced by a single promissory note executed by the Lessor in
substantially the form of EXHIBIT B (individually a "TRANCHE A NOTE" and
collectively the "TRANCHE A NOTES"), dated as of the date such Lender becomes a
party to this Agreement, payable to the order of such Lender in a principal
amount equal to the maximum amount of its Tranche A Loan Commitment as
originally in effect and otherwise duly completed. The date and amount of each
Tranche A Loan made by each Lender, and all payments made on account of the
principal thereof, shall be recorded by such Lender on its books and, prior to
any transfer of its Tranche A Note, on the schedules attached to its Tranche A
Note or any continuation thereof.
(b) The Tranche B Loans made by each Lender under Section
2.01(a) shall be evidenced by a single promissory note executed by the Lessor,
in substantially the form of EXHIBIT C (individually a "TRANCHE B NOTE" and
collectively the "TRANCHE B NOTES"), dated as of the date such Lender becomes a
party to this Agreement, payable to the order of such Lender in a principal
amount equal to the maximum amount of its Tranche B Loan Commitment as
originally in effect and otherwise duly completed. The date and amount of each
Tranche B Loan made by each Lender, and all payments made on account of the
principal thereof, shall be recorded by such Lender on its books and, prior to
any transfer of its Tranche B Note, on the schedules attached to its Tranche B
Note or any continuation thereof.
(c) Upon receipt of an affidavit of an officer of any Lender
as to the loss, theft, destruction or mutilation of its Note, the Lessor will
issue, in lieu thereof, a replacement Note in the same principal amount thereof
and otherwise of like tenor.
Section 2.06 SEVERAL OBLIGATIONS. The failure of any Lender or
the Lessor to make any Loan or Lessor Investment Payment to be made by it on the
date specified therefor shall not
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relieve any other Lender or the Lessor of its obligation to make its Loan and/or
Lessor Investment Payment on such date, but neither any Lender nor the Lessor
shall be responsible for the failure of any other Lender or the Lessor to make a
Loan or Lessor Investment Payment to be made by such other Lender or the Lessor.
Section 2.07 APPLICABLE FUNDING OFFICES. The Loans and Lessor
Investment Payments made by each Lender and the Lessor shall be made and
maintained at such Lender's or the Lessor's Applicable Funding Office therefor.
Section 2.08 ACQUISITION AND CONSTRUCTION OF FACILITY, ETC.
The Lessor, acting solely by and through the Company as its
Acquisition/Construction Agent under the Agency Agreement and subject to the
availability of funds under this Agreement, shall, on the terms and conditions
set forth in the Transaction Documents, acquire the Facility, cause to be
constructed the improvements thereon, and lease the Facility to the Lessee
pursuant to the Lease. The Company shall enter into and perform its obligations
under the Agency Agreement, the Lease and the other Transaction Documents, all
in accordance with the terms thereof.
Section 2.09 EXTENSION OF NOTES. On any day that is not less
than twelve (12) months and not more than eighteen (18) months prior to the then
current Maturity Date, the Company, as Acquisition/Construction Agent for the
Lessor, may request in writing to the Agent (which shall promptly notify the
Lessor and the Lenders) that the then current Maturity Date be extended for a
period up to three (3) years but in no event beyond the Scheduled Lease
Termination Date (as such date may be extended in accordance with Section 2(b)
of the Lease). Any such extension shall require (i) the unanimous written
consent of each Lender and the Agent, each acting in its sole and absolute
discretion, and (ii) the agreement of the Lessor, acting in its sole and
absolute discretion, to extend the term of the Lease in accordance with Section
2(b) thereof for an equivalent period. In the event such an extension is
requested and the requirements set forth in the immediately preceding sentence
are met, such extension shall be effective upon the execution of documentation
evidencing the same and containing such additional terms as the Company, the
Agent, the Lessor and each Lender, each acting in its sole discretion, may
agree. If any Lender or the Agent shall fail to respond to the Company's written
request for extension within sixty (60) days of receipt, such failure to respond
shall be deemed a denial of such request for extension. The Company, the Agent
and the Lessor shall consult in good faith with a view toward substituting a
replacement Lender, acceptable to the Company and the Agent, for any Lender
denying a request for extension.
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ARTICLE III
Payment of Loans and Lessor Investment Payments;
Payment of Interest, Yield and Other Amounts
Section 3.01 REPAYMENT OF THE NOTES AND REDEMPTION OF
LESSOR INVESTMENT.
(a) The Company, as Acquisition/Construction Agent for the
Lessor, will pay or cause to be paid to the Agent for the account of the Agent,
the Lenders and the Lessor the unpaid principal balance of the Loans and the
Lessor Investment Payments, all accrued interest, Yield (including Accrued
Construction Term Yield), fees and other amounts owing under this Agreement, in
full on the Maturity Date.
(b) If, on or before the Maturity Date, the Company (or any of
its Affiliates) shall exercise the option to purchase the Facility in its
entirety, then the purchase price for the Facility shall be equal to the
Purchase Price and the proceeds of such sale, when received by the Lessor, or
the Agent for the account of the Lessor under the Lease, shall be applied by the
Lessor or the Agent, as applicable, in the order specified in Section 3.05(a).
If, on the Maturity Date, no Cancellation Event shall have occurred and the
Company (or any of its Affiliates) shall elect to pay the Final Rent Payment or
Completion Costs Payment, as applicable, and not to purchase the Facility, and
shall pay the Final Rent Payment or the Completion Costs Payment, as applicable,
all amounts received by the Lessor, or the Agent for the account of the Lessor,
pursuant to or in connection with the Lease, this Agreement or any other
Transaction Document or as proceeds of the disposition of the Facility shall be
applied by the Lessor or the Agent, as applicable, to pay the unpaid principal
balance of the Loans, all accrued interest, (including Accrued Construction Term
Interest), fees and other amounts owing under this Agreement in the order
specified in Section 3.05(b).
Section 3.02 PREPAYMENTS AND REDEMPTIONS. (a) On or after the
fifth anniversary of the Lease Commencement Date, the Company, as
Acquisition/Construction Agent for the Lessor, may, upon at least two (2)
Business Days' notice to the Agent which specifies the proposed date and
aggregate principal amount of the prepayment and/or redemption and the Loans
and/or Lessor Investments to be prepaid or redeemed, and if such notice is given
the Company, as Acquisition/Construction Agent for the Lessor, shall, as
specified in such notice, prepay, and the Interim Rent Payment, when received by
the Lessor, or the Agent for the account of the Lessor, shall be applied to
prepay, the outstanding principal amounts of the Loans comprising the same
Borrowing in whole or ratably in part, together with accrued interest to the
date of such prepayment on the amount prepaid, and/or redeem the outstanding
principal amount of the Lessor Investment in whole or ratably in part, together
with accrued
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Yield to the date of such prepayment on the amount prepaid; PROVIDED, HOWEVER,
that (i) each partial prepayment shall be in an aggregate principal amount not
less than $1,000,000 or an integral multiple of $250,000 in excess thereof, and
(ii) in the event of any such prepayment of any Loan or redemption of Lessor
Investment on any day other than the last day of the Interest Period for such
Loan or Yield Period for such Lessor Investment, the Company, as
Acquisition/Construction Agent for the Lessor, shall be obligated to reimburse
the Lenders and/or Lessor (as applicable) in respect thereof pursuant to, and to
the extent required by, Section 5.05. Any prepayment pursuant to this Section
3.02 shall be allocated among the Loans and Lessor Investment to achieve or
maintain the Required Percentage Composition; or if, after giving effect to such
prepayment, it is not possible to achieve or maintain such ratio, then such
prepayment will be allocated among the Loans and/or Lessor Investment in the
manner which most closely approximates, but does not violate, the Required
Percentage Composition. In no event shall any prepayment be allowed which
results in the Required Percentage Composition being violated.
(b) On each date on which the Aggregate Loan Commitments and
the Lessor Investment Commitment are reduced pursuant to Section 2.03, the
Company, as Acquisition/Construction Agent for the Lessor, shall repay or prepay
such principal amount of the outstanding Loans and Lessor Investment (together
with interest and Yield, respectively, accrued thereon), as may be necessary so
that after such payment the aggregate unpaid principal amount of the Loans and
the Lessor Investment does not exceed the Aggregate Loan Commitments and the
Lessor Investment Commitment, respectively, as then reduced.
Section 3.03 INTEREST ON NOTES; YIELD ON LESSOR INVESTMENT;
OVERDUE AMOUNTS.
(a) The Lessor, and the Company, as the
Acquisition/Construction Agent for the Lessor, have requested that interest
accruing during the Construction Term be capitalized, and the Lenders have
agreed thereto. Therefore, all interest accruing on the outstanding principal
amount of the Loans on each day during the Construction Term shall be
capitalized (i) at the end of each Interest Period ending during the
Construction Term and (ii) on the last day of the Construction Term. The
Company, as Acquisition/Construction Agent for the Lessor, will pay or cause to
be paid to the Agent for the account of each Lender interest (and during the
Construction Term, interest will accrue) on the unpaid principal amount of its
Loans for each day during the period commencing on the date of such Loan to but
excluding the date such Loan shall be paid in full, for each Interest Period
relating thereto, at a rate per annum equal to the Adjusted LIBO Rate for such
Loan plus the Applicable Margin for such Loan, but in no event to exceed the
Highest Lawful Rate.
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(b) The Company, as Acquisition/Construction Agent for the
Lessor, will pay or cause to be paid to the Agent for the account of the Lessor
Yield (and during the Construction Term, Yield will accrue) on the unpaid amount
of the Lessor Investment for each day during the period from and including the
date of the initial Lessor Investment Payment to but excluding the date such
Lessor Investment shall be repaid or redeemed in full, for each Yield Period
relating thereto, at a rate per annum equal to the Adjusted LIBO Rate for such
Yield Period plus the Applicable Margin for such Lessor Investment, but in no
event to exceed the Highest Lawful Rate.
(c) All Yield accruing on the outstanding amount of the Lessor
Investment on each day during the Construction Term shall be capitalized (i) at
the end of each Yield Period ending during the Construction Term and (ii) on the
last day of the Construction Term (the aggregate of the capitalized amount of
Yield accrued during the Construction Term as aforesaid, "Accrued Construction
Term Yield"). The Company, as Acquisition/Construction Agent for the Lessor,
will pay or cause to be paid for the account of the Lessor, in equal quarterly
installments on the last day of each Rental Period that ends during the first
year of the Basic Term, the unpaid balance of Accrued Construction Term Yield
from time to time. All Yield accruing under this Section 3.03(c) shall accrue
and be payable at a rate per annum equal to the Adjusted LIBO Rate for the
applicable Yield Period plus the Applicable Margin, but in no event to exceed
the Highest Lawful Rate.
(d) Notwithstanding the foregoing, the Company, as
Acquisition/Construction Agent for the Lessor, shall pay or cause to be paid to
the Agent for the account of each Lender or the Lessor interest or Yield, as
applicable, at the applicable Default Rate on any principal of any Loan or the
amount of Lessor Investment, interest, Yield, Accrued Construction Term Yield,
fees or other amounts owing by the Lessor under this Agreement or any other
Transaction Document which shall not be paid in full when due (whether at stated
maturity, by acceleration or otherwise), for the period commencing on the due
date thereof until the same is paid in full, in each case to the maximum extent
permitted by applicable law. The Company shall pay to the Lessor, or to the
Agent for the account of each Lender, as applicable, interest at the Default
Rate on any amounts owing by the Company under this Agreement or any other
Transaction Document which shall not be paid in full when due (whether at stated
due date, on acceleration or otherwise), for the period commencing on the due
date thereof until the same is paid in full, in each case to the maximum extent
permitted by applicable law.
(e) Accrued interest on each Loan together with accrued Yield
on the Lessor Investment (other than Accrued Construction Term Yield) shall be
payable (or, if applicable, capitalized pursuant to Section 3.03(a) or (c)) on
the last day of each Interest Period or Yield period, as applicable, therefor
and on the Maturity Date. Accrued Construction Term Yield shall
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be payable in equal quarterly installments on the last day of each Rental Period
that ends during the first year of the Basic Term in accordance with Section
3.03(c). Interest or Yield, as applicable, payable at the Default Rate shall be
payable from time to time on demand.
(f) Promptly after the determination of the rate of any
interest or Yield provided for herein or any change therein, the Agent shall
notify the Lenders and the Lessor to which such interest or Yield is payable and
the Company of such determination or change.
Section 3.04 PAYMENTS BY LESSOR. All moneys received by the
Lessor, or by the Agent for the account of the Lessor, pursuant to the Lease
including, but not limited to, payments of Basic Rent, Supplemental Rent, the
Termination Value or the Final Rent Payment or the Completion Costs Payment, as
applicable, except for amounts allocable to fees and expenses of the Lessor
pursuant to the Transaction Documents and amounts comprising Supplemental Rent
payable to third Persons, if any, shall be paid to the Lessor, the Agent and the
Lenders, as the case may be, in accordance with, and to pay amounts owing
pursuant to, the terms of this Agreement, including without limitation Section
4.01 and, if applicable, Section 3.05.
Section 3.05 APPLICATIONS OF PAYMENTS AND PROCEEDS.
(a) Upon the occurrence of a Cancellation Event or a
Termination Event (and the Company elects pursuant to Section 15(a) or (b) of
the Lease to exercise its option to purchase the Facility for the Purchase Price
or elects pursuant to Section 15(b)(ii)(B) of the Lease to pay the Termination
Value), or if the Company otherwise elects to acquire the Facility for the
Purchase Price, the Purchase Price or the Termination Value, as the case may be,
and all other monies received by the Lessor or the Agent pursuant to or in
connection with the Lease, this Agreement or any other Transaction Document,
including, without limitation, the proceeds of any insurance or condemnation
awards received as a result of any Casualty Occurrence or Loss Event, shall be
applied to prepay the Loans and redeem the Lessor Investment in the following
order:
(1) FIRST, to pay or reimburse all costs and expenses,
including, without limitation, those in connection with Indemnified
Risks, increased costs, Supplemental Rent or Taxes, then due and owing
to the Agent, the Lessor and the Lenders under the other Transaction
Documents, pro rata to each such Person (collectively, the "OTHER
TRANSACTION EXPENSES");
(2) SECOND, to pay all accrued, unpaid interest and fees on
the Notes, pro rata, to the Lenders, and all accrued, unpaid Yield,
including without limitation, all Accrued Construction Term Yield, to
the Lessor;
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(3) THIRD, to pay the outstanding principal balance of the
Loans, pro rata, to the Lenders;
(4) FOURTH, to pay the outstanding principal balance of the
Lessor Investment, to the Lessor; and
(5) FIFTH, to pay all other amounts owing by the Company under
the Transaction Documents.
Any monies remaining after payment in full of the foregoing amounts and all
other amounts owing by the Company from time to time under the Transaction
Documents shall be paid to the Lessor for distribution to the Company.
(b) If (i) a Termination Event has occurred, (ii) a
Cancellation Event does not exist and (iii) the Company has not elected to
purchase the Facility for the Purchase Price and has paid the Final Rent Payment
or Completion Costs Payment, as applicable, pursuant to Section 15(a) of the
Lease, then the Final Rent Payment or Completion Costs Payment, as applicable,
shall be applied as follows:
(1) FIRST, to pay or reimburse all Other Transaction Expenses;
(2) SECOND, to pay all accrued, unpaid interest on the Loans,
pro rata, to the Lenders;
(3) THIRD, to pay all accrued, unpaid fees, pro rata, to the
Lenders and the Lessor;
(4) FOURTH, to pay the outstanding principal balance of the
Tranche A Loans, pro rata, to the Tranche A Lenders and (without
duplication), to pay Completion Costs, if applicable; and
(5) FIFTH, in the case of a Final Rent Payment, to pay all
accrued, unpaid Yield, including without limitation, all Accrued
Construction Term Yield, to the Lessor.
In such circumstances, all other monies received by the Lessor or the Agent
pursuant to or in connection with the Lease, this Agreement or any other
Transaction Document or as proceeds of disposition of the Facility shall be
applied as follows:
(1) FIRST, to pay the outstanding principal balance of the
Tranche B Notes, pro rata, to the Tranche B Lenders;
(2) SECOND, to pay the outstanding balance of the Lessor
Investments to the Lessor;
(3) THIRD, to the extent not prohibited by law, to pay any
unpaid amount specified in this paragraph (b) above, in the order
specified in paragraph (b), or to whomever else
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may be legally entitled thereto, as their respective
interests may appear and
(4) FOURTH, to reimburse the Company for Support Expenses
incurred by it under the Agency Agreement.
Any monies remaining after payment in full of the foregoing amounts and all
other amounts owing by the Company from time to time under the Transaction
Documents shall be paid to the Lessor for distribution to the Company.
(c) If (i) the Company is required to purchase the Facility or has
elected to exercise its option to purchase the Facility, and has failed to pay
the Purchase Price, or (ii) the circumstances described in (b)(i) and (ii) above
exist, but the Company has either failed to elect to exercise its option to
purchase the Facility and failed to make the Final Rent Payment or Completion
Costs Payment, as applicable, and/or (iii) the Company has failed to furnish to
the Agent a satisfactory update of the Environmental Assessment, then the Lessor
will be entitled to exercise eviction and/or foreclosure remedies and all moneys
received by the Agent or the Lessor from the disposition of the Facility or
other foreclosure action, net of reasonable enforcement costs, will be applied
(i) FIRST, as provided in paragraph (b) above, and (ii) SECOND, any remaining
net proceeds shall be applied in accordance with paragraph (a) above in the same
manner as if the Final Rent Payment had been made, and in such circumstances,
the Company shall remain liable for any deficiency in such remaining net
proceeds to pay such amounts described in paragraph (a).
ARTICLE IV
Payments; Computations; Etc.
Section 4.01 PAYMENTS. The Company, as
Acquisition/Construction Agent for the Lessor (or, in the case of the principal
amount of the Tranche B Loans and the Lessor Investment Payments (in the
circumstances described in Section 3.05(b) and if the Company shall have paid
the Final Rent Payment or the Completion Costs Payment, as applicable), the
Lessor), shall make each payment under this Agreement, the Notes or the Lessor
Investment, whether the amount so paid is owing to any or all of the Lessor, the
Lenders or the Agent, not later than 12:00 noon, prevailing Eastern time,
without setoff, counterclaim, or any other deduction whatsoever, on the day when
due in Dollars to the Agent at its address at 75 State Street, Boston,
Massachusetts 02109, or at such other location designated by notice to the
Company from the Agent, in same day funds, except as otherwise expressly
provided in Section 2.01(d)(i). The Agent will promptly thereafter cause to be
distributed to the Lenders and the Lessor like funds relating to the payment of
principal, interest or Yield ratably (other than amounts payable pursuant to
Section 4.06 or 11.03 or Article V) according to the respective
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amounts of such principal, interest or Yield then due and owing to the Lenders
and the Lessor, and like funds relating to the payment of any other amount
payable to any Lender or the Lessor to such Lender or the Lessor, in each case
to be applied in accordance with the terms of this Agreement. Upon its
acceptance of an Assignment and Acceptance and recording of the information
contained therein in the Register pursuant to Section 11.06(d), from and after
the effective date specified in such Assignment and Acceptance, the Agent shall
make all payments under this Agreement, the Notes or the Lessor Investment in
respect of the interest assigned thereby to the assignee thereunder, and the
parties to such Assignment and Acceptance shall make all appropriate adjustments
in such payments for periods prior to such effective date directly between
themselves. Any payments and prepayments received hereunder, other than after
the occurrence and during the continuation of a Cancellation Event or
Termination Event, shall be applied in accordance with the purpose for which
such payment or prepayment is made. All payments by the Company under any
Transaction Document shall be made in the manner specified in this Article IV.
Section 4.02 PRO RATA TREATMENT. Except to the extent
otherwise provided herein: (a) each Tranche A Loan and Tranche B Loan from the
Lenders under Section 2.01 shall be made from the Lenders, and each termination
or reduction of the Aggregate Loan Commitments under Section 2.03 shall be
applied to the Tranche A Loan Commitment and Tranche B Loan Commitment of each
Lender, pro rata according to the amount of the Lenders' respective Tranche A
Loan Commitments and Tranche B Loan Commitments; (b) each payment of Tranche A
Loans and of Tranche B Loans, respectively, by or for the account of the Lessor
shall be made to the account of the Tranche A Lenders and Tranche B Lenders,
respectively, pro rata in accordance with the respective unpaid principal amount
of the Tranche A Notes and Tranche B Notes held by such Lenders; (c) each
payment of interest in respect of Tranche A Loans and of Tranche B Loans,
respectively, by or for the account of the Lessor shall be made to the account
of the Tranche A Lenders and Tranche B Lenders, respectively, pro rata in
accordance with the amounts of interest due and payable to the Tranche A Lenders
and Tranche B Lenders, respectively; and (d) each Borrowing shall be allocated
pro rata among the Tranche A Loans and the Tranche B Loans so that after giving
effect thereto the Required Percentage Composition is satisfied.
Section 4.03 COMPUTATIONS. All computations of interest and
Yield shall be made by the Agent, and computations of interest and Yield
pursuant to Section 5.01 shall be made by each Lender with respect to its own
Loans or the Lessor Investment, on the basis of a year of 360 days (or, in the
case of computations based on the Prime Rate, 365/366 days), in each case for
the actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest or Yield is payable. Whenever
any payment hereunder or under the Notes or the Lessor Investment shall be
stated to be due on a day other than a Business Day, such payment shall be
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made on the next succeeding Business Day, and such extension of time in such
case shall be included in the computation of payment of interest or Yield;
PROVIDED, HOWEVER, that if such extension would cause payment of interest on or
principal of any Loan or of Yield on or amount of any Lessor Investment to be
made in the next following calendar month, such payment shall be made on the
next preceding Business Day.
Section 4.04 NON-RECEIPT OF FUNDS BY THE AGENT. Unless the
Agent shall have received notice from the Lessor or the Company, as
Acquisition/Construction Agent for the Lessor, prior to the date on which any
payment is due to the Lenders hereunder that the Company will not make such
payment in full, the Agent may assume that the Lessor or the Company, as
Acquisition/Construction Agent for the Lessor, has made such payment in full to
the Agent on such date and the Agent may, in reliance upon such assumption, but
shall not be obligated to, cause to be distributed to each Lender on such due
date an amount equal to the amount then due such Lender. If and to the extent
the Lessor or the Company, as Acquisition/Construction Agent for the Lessor,
shall not have so made such payment in full to the Agent, each Lender shall
repay to the Agent forthwith on demand such amount distributed to such Lender
together with interest thereon, for each day from the date such amount is
distributed to such Lender until the date such Lender repays such amount to the
Agent, at a rate equal to (i) until the Business Day after the Business Day on
which such demand is made, the Federal Funds Rate for such day and (ii)
thereafter 50 basis points above the Federal Funds Rate for such day.
Section 4.05 SHARING OF PAYMENTS. If any Lender shall obtain
any payment (whether voluntary, involuntary, through the exercise of any right
of set-off, or otherwise) on account of the Loans made by it (other than
pursuant to Section 4.06 or 11.03 or Article V) in excess of its ratable share
of payments then due and owing to it in accordance with the payment orders
specified in Section 3.05 or Section 4.02 on account of the Loans obtained by
all the Lenders, such Lender shall forthwith purchase from the other Lenders
participations in such Loans made by them as shall be necessary to cause such
purchasing Lender to share the excess payment ratably with each of them (or, if
necessary, to cause such purchasing Lender to assume the payment priority
specified in Section 3.05), PROVIDED, HOWEVER, that if all or any portion of
such excess payment is thereafter recovered from such purchasing Lender, such
purchase from each Lender shall be rescinded and each Lender shall repay to the
purchasing Lender the purchase price to the extent of such recovery together
with an amount equal to such Lender's ratable share (according to the proportion
of (a) the amount of such Lender's required repayment to (b) the total amount so
recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.
The Company and the Lessor agree that any Lender so purchasing a participation
from another Lender pursuant to this Section may, to the fullest extent
permitted by law, exercise all its rights
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of payment (including any right of set-off) with respect to such participation
as fully as if such Lender were the direct creditor of Lessor and the Company in
the amount of such participation.
Section 4.06 TAXES.
(a) Any and all payments of principal, interest, Lessor
Investment, Yield and all other amounts to be paid by the Company, for its own
account or as Acquisition/Construction Agent for the Lessor hereunder or under
the Notes or the Lessor Investment or any other Transaction Document to each
Indemnified Party shall be made, in accordance with Section 4.01, without
deduction for, and free from, any tax, imposts, levies, duties, deductions, or
withholdings of any nature now or at any time hereafter imposed by any
Governmental Authority or by any taxing authority thereof or therein excluding
in the case of each Lender and the Lessor, taxes imposed on or measured by the
net income of any Lender or the Lessor, and franchise taxes imposed on such
Lender or the Lessor, by the jurisdiction under the laws of which such Lender or
the Lessor is organized or any political subdivision thereof, and taxes imposed
on or measured by such Lender or the Lessor's income, and franchise taxes
imposed on such Lender or the Lessor, by the jurisdiction of such Lender's or
the Lessor's Applicable Funding Office or any political subdivision thereof (all
such non-excluded taxes, imposts, levies, duties, deductions or withholdings of
any nature being "TAXES"). In the event that the Company, as
Acquisition/Construction Agent for the Lessor, is required by applicable law to
make any such withholding or deduction of Taxes with respect to any Loan or
Lessor Investment Payment or other amount, the Company, as
Acquisition/Construction Agent for the Lessor, shall pay such deduction or
withholding to the applicable taxing authority, shall promptly furnish to any
Lender or the Lessor or (subject to Section 11.06(j)) other Person in respect of
which such deduction or withholding is made all receipts and other documents
evidencing such payment and shall pay to such Lender or the Lessor or (subject
to Section 11.06(j)) other Person additional amounts as may be necessary in
order that the amount received by such Lender or the Lessor or (subject to
Section 11.06(j)) other Person after the required deduction or withholding shall
equal the amount such Lender or the Lessor would have received had no such
deduction or withholding been made.
(b) Each Lender that is not chartered and organized under the
laws of the United States of America or a state thereof (each a "NON-U.S.
DOMESTIC LENDER ") agrees, as soon as practicable after receipt by it of a
request by the Lessor, or the Company, as Acquisition/Construction Agent for the
Lessor, to do so, to file all appropriate forms and take other appropriate
action to obtain a certificate or other appropriate document from the
appropriate governmental authority in the jurisdiction imposing the relevant
taxes, establishing that it is entitled to receive payments of principal,
interest under or in respect of this Agreement and the Notes without deduction
and free from
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withholding of any Taxes imposed by such jurisdiction; PROVIDED, THAT, if it is
unable, by virtue of any applicable law, rule or regulation, to establish such
exemption or to file such forms and, in any event, during such period of time as
such request for exemption is pending, the Company, as Acquisition/Construction
Agent for the Lessor, shall nonetheless remain obligated under the terms of the
immediately preceding paragraph. Without limiting the foregoing, each Non-U.S.
Domestic Lender agrees to deliver to the Lessor and the Company, as Acquisition/
Construction Agent for the Lessor, promptly upon any request therefor from time
to time, such forms, documents and other information as may be required by
applicable law from time to time to establish that payment to such Non-U.S.
Domestic Lender hereunder or under the Notes or any Operative Guaranty are
exempt from Taxes. Without limiting the generality of the foregoing, each
Non-U.S. Domestic Lender agrees, on the date of its execution of this Agreement
(or, in the case of an Eligible Assignee, on the date on which such Eligible
Assignee becomes a party to this Agreement), to deliver in duplicate to the
Lessor, or the Company, as Acquisition/Construction Agent for the Lessor,
accurate and duly completed and executed Internal Revenue Service Form 4224 or
1001 (as applicable), together with Internal Revenue Service Forms W-8 or W-9,
as appropriate, establishing that such Non-U.S. Domestic Lender is entitled to a
complete exemption from all Taxes imposed by the federal government of the
United States by way of withholding, including without limitation, all backup
withholding ("U.S. WITHHOLDING TAXES"). Thereafter, from time to time (i) upon
any change by a Non-U.S. Domestic Lender of its Applicable Funding Office, (ii)
before or promptly after any event occurs (including, without limitation, the
passing of time) requiring a change in or update of the most recent Form 4224 or
1001 previously delivered by such Lender, or (iii) upon the reasonable request
of the Lessor, or the Company, as Acquisition/Construction Agent for the Lessor,
such Non-U.S. Domestic Lender shall deliver in duplicate to the Lessor and the
Company, as Acquisition/Construction Agent for the Lessor, accurate and duly
completed and executed Form 4224 or 1001 (as applicable) (together with Forms
W-8 or W-9, as aforesaid) in replacement of the forms previously delivered by
such Non-U.S. Domestic Lender, establishing that such Non-U.S. Domestic Lender
is entitled to an exemption in whole or in part from all U.S. Withholding Taxes
except to the extent that a change in law has rendered all such forms
inapplicable to such Non-U.S. Domestic Lender.
(c) If the Internal Revenue Service or any other taxation
authority in the United States or in any other jurisdiction successfully asserts
a claim that such Non-U.S. Domestic Lender, the Lessor or the Company, as
Acquisition/Construction Agent for the Lessor, did not properly withhold tax
from amounts paid to or for the account of any Non- U.S. Domestic Lender or its
participant (because the appropriate form was not properly executed, or because
such Non-U.S. Domestic Lender failed to notify the Lessor or the Company, as
Acquisition/Construction Agent for the Lessor, of a change in
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circumstances which rendered the exemption from (or reduction in) U.S.
Withholding Taxes ineffective), such Lender shall indemnify the Lessor, or the
Company, as Acquisition/Construction Agent for the Lessor, as applicable, fully
for all amounts paid, directly or indirectly, by the Lessor or the Company, as
Acquisition/Construction Agent for the Lessor, as applicable, as tax or
otherwise, including, without limitation, penalties and interest.
(d) In the event any Lender or the Lessor receives a refund
from the Governmental Authority to which such Taxes were paid of any Taxes paid
by the Company, as Acquisition/Construction Agent for the Lessor, pursuant to
this Section 4.06, it will pay to the Company, as Acquisition/Construction Agent
for the Lessor, the amount of such refund promptly upon receipt thereof;
PROVIDED, HOWEVER, if at any time thereafter it is required to return such
refund, the Company, as Acquisition/Construction Agent for the Lessor, shall
promptly repay to it the amount of such refund.
(e) Nothing in this Section shall require any Lender or the
Lessor to disclose any information about its tax affairs or interfere with,
limit or abridge the right of any Lender or the Lessor to arrange its tax
affairs in any manner in which it desires, subject to Section 11.16(b).
(f) Without prejudice to the survival of any other agreement
of the Lessor and the Company hereunder, the agreements and obligations of the
Lessor, the Company, and the Lenders contained in this Section 4.06 shall be
applicable with respect to any participant, Eligible Assignee or other
transferee, and any calculations required by such provisions (i) shall be made
based upon the circumstances of such participant, Eligible Assignee or other
transferee (subject to Section 11.06(j)), and (ii) constitute a continuing
agreement and shall survive for a period of three (3) years after the
termination of this Agreement and the payment in full or cancellation of the
Commitments, the Notes.
ARTICLE V
Yield Protection and Illegality
Section 5.01 BASIS FOR DETERMINING INTEREST RATE INADEQUATE OR
UNFAIR. The Agent shall give prompt notice to the Lessor, the Company and the
Lenders of the applicable interest rate or Yield determined by the Agent for
purposes of Sections 3.03(a) and (b). If on or prior to the first day of any
Interest Period:
(a) the Agent determines that deposits in Dollars (in the
applicable amounts), are not being offered in the relevant market for such
Interest Period or Yield Period, or
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(b) the Majority Lenders, or the Lessor, as applicable,
determine and give notice to the Agent that the rates or yield determined on the
basis of the LIBO Rate for any Interest Period or Yield Period for Loans or
Lessor Investment Payments will not adequately and fairly reflect the cost to
either the Majority Lenders or the Lessor of making, funding or maintaining
their respective Loans or Lessor Investment Payments for such Interest Period or
Yield Period, the Agent shall forthwith so notify the Lessor, the Company and
the Lenders, whereupon,
(i) in the case of such notice from the Majority Lenders, each
such Loan, or in the case of such notice from the Lessor, the Lessor
Investment Payments, will automatically, on the last day of the then
existing Interest Period or Yield Period, as applicable, accrue
interest or Yield, as applicable, at a rate based upon the Base Rate
plus the Applicable Margin.
(ii) the obligation of the Majority Lenders or the Lessor, as
applicable, to make Loans, or to maintain Loans or Lessor Investment
Payments or Lessor Investment, as applicable, at the Adjusted LIBO Rate
shall be suspended until the Agent shall notify the Lessor, the Company
and the Lenders that the circumstances causing such suspension no
longer exist, and
(iii) unless the Lessor, or the Company, as
Acquisition/Construction Agent for the Lessor, notifies the Agent at
least two (2) Business Days before the date of any Borrowing or
requested Lessor Investment Payment for which Advance Notice has
previously been given that it elects not to effect a Borrowing, or
require such Lessor Investment Payment, as applicable, on such date,
such Borrowing or requested Lessor Investment Payment shall instead be
made at a rate of interest or Yield, as applicable, based upon the Base
Rate plus the Applicable Margin. Upon the written request of the Lessor
or the Company, as Acquisition/Construction Agent for the Lessor, the
Agent shall negotiate with the Company, as Acquisition/Construction
Agent for the Lessor, and the relevant Lender or the Lessor for a
reasonable period of time, as determined in the Agent's discretion, to
develop a substitute interest rate basis hereunder; PROVIDED, however,
(x) the Agent, the Lenders, the Lessor and the Company make no
representation, warranty or covenant that any such agreement will be
made, and (y) any relevant Loans or Lessor Investment Payments shall
continue to have interest or Yield accrue thereon at the Base Rate
during the continuance of any such negotiations and thereafter should
no alternate interest rate be agreed to by the necessary parties.
Section 5.02 ILLEGALITY. If, after the date hereof, the
adoption of any applicable law, rule or regulation, or any change therein, or
any change in the interpretation or
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administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof (any such
agency being referred to as a "BANKING AUTHORITY" and any such event being
referred to as a "CHANGE OF LAW"), or compliance by any Lender or the Lessor (or
its Applicable Funding Office) with any request or directive (whether or not
having the force of law) of any Banking Authority shall make it unlawful or
impossible for any Lender or the Lessor (or its Applicable Funding Office) to
make, maintain or fund its Loans or Lessor Investment and such Lender or the
Lessor shall so notify the Agent, the Agent shall forthwith give notice thereof
to the other Lenders and to the Lessor and the Company, whereupon until such
Lender or the Lessor notifies the Agent, the other Lenders, the Lessor and the
Company that the circumstances giving rise to such suspension no longer exist,
the obligation of such Lender or the Lessor to make or maintain Loans or Lessor
Investment based upon the Adjusted LIBO Rate shall be suspended. Before giving
any notice to the Agent pursuant to this Section, such Lender or the Lessor
shall designate a different Applicable Funding Office if such designation will
avoid the need for giving such notice and will not, in the judgment of such
Lender or the Lessor, be otherwise materially disadvantageous to such Lender or
the Lessor. If any Lender shall determine that it may not lawfully continue to
maintain and fund any of its outstanding Loans to maturity and shall so specify
in such notice, the Lessor or the Company, as Acquisition/Construction Agent for
the Lessor, shall immediately prepay in full the then outstanding principal
amount of each Loan of such Lender, together with accrued interest thereon.
Concurrently with prepaying each such Loan, the Company, as
Acquisition/Construction Agent for the Lessor shall borrow as a Loan, PROVIDED
that no Default or Event of Default shall then exist, but without any
requirement for the satisfaction of any of the other conditions precedent set
forth herein, in an equal principal amount from such Lender at a rate based upon
the Base Rate, and each Lender agrees to make such a Loan on the foregoing
terms. If the Lessor shall determine that it may not lawfully continue to
maintain and fund its Lessor Investment to the end of the Lease Term based on
the Adjusted LIBO Rate and shall so specify in such notice, the Company, as
Acquisition/Construction Agent for the Lessor, shall immediately redeem in full
the then outstanding amount of the Lessor Investment of the Lessor (together
with accrued Yield thereon, if such redemption occurs after the end of the
Construction Term). Concurrently with, and as a condition to, redemption of such
Lessor Investment, the Lessor shall make a new Lessor Investment Payment in the
same amount as the amount so redeemed, without any requirement for the
satisfaction of any of the conditions precedent set forth herein, and Yield
thereon shall be computed based upon the Base Rate. At any time within ninety
(90) days after the giving of a notice by any Lender pursuant to this Section
5.02, so long as no Event of Default shall be in existence, the Company, as
Acquisition/Construction Agent for the Lessor, may require by written notice to
that Lender that (a) it assign its pro rata share of the Commitment to another
Lender or to a bank or other financial institution selected by the Company,
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as Acquisition/Construction Agent for the Lessor, and reasonably acceptable to
the Agent, which is willing to accept such assignment or (b) it surrender its
pro rata share of the Commitment and terminate its rights and obligations as a
Lender hereunder, concurrently with a reduction by the Company, as
Acquisition/Construction Agent of the Lessor, of the Commitment by an amount
equal to the pro rata share of the Commitment held by that Lender.
Section 5.03 INCREASED COST AND REDUCED RETURN. (a) If after
the date hereof, a Change of Law or compliance by any Lender or the Lessor (or
its Applicable Funding Office) with any request or directive (whether or not
having the force of law) of any Banking Authority:
(i) shall subject any Lender or the Lessor (or its Applicable
Funding Office) to any tax, duty or other charge on its Loans or Lessor
Investment Payments, its Notes or Lessor Investment, or its obligation
to make Loans or Lessor Investment Payments or maintain its Loans or
Lessor Investment or shall change the basis of taxation of payments to
any Lender or the Lessor (or its Applicable Funding Office) of the
principal amount of or interest on its Loans, the amount of or Yield on
its Lessor Investment Payments or Lessor Investment or any other
amounts due under this Agreement or any other Transaction Document in
respect of its Loans or its Lessor Investment (except for changes in
the rate of tax on the overall net income or gross receipts or
franchise tax of such Lender or the Lessor or its Applicable Funding
Office imposed by the jurisdiction in which such Lender's or the
Lessor's principal executive office or Applicable Funding Office is
located); or
(ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement (including, without limitation,
any such requirement imposed by the Board of Governors of the Federal
Reserve System (but excluding any such requirement included in an
applicable Euro-Dollar Reserve Percentage) against assets of, deposits
with or for the account of, or credit extended by, any Lender or the
Lessor (or its Applicable Funding Office); or
(iii) shall impose on any Lender or the Lessor (or its
Applicable Funding Office) or on the United States market or the London
interbank market any other condition affecting its Loans, Notes, Lessor
Investment Payments, Lessor Investment, or obligation to make or
maintain Loans or Lessor Investment Payments or its Lessor Investment;
and the result of any of the foregoing is to increase the cost to such Lender or
the Lessor (or its Applicable Funding Office) of making or maintaining any Loan
or Lessor Investment Payment or Lessor Investment, or to reduce the amount of
any sum received or receivable by such Lender or the Lessor (or its Applicable
Funding Office) under this Agreement or under its relevant Notes
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or Lessor Investment or any other Transaction Document with respect thereto, by
an amount deemed by such Lender or the Lessor to be material, then, within
fifteen (15) days after demand by such Lender or the Lessor (with a copy to the
Agent), the Company, as Acquisition/Construction Agent for the Lessor, shall pay
to such Lender or the Lessor such additional amount or amounts as will
compensate such Lender or the Lessor for such increased cost or reduction;
PROVIDED, HOWEVER, that no such amount may be claimed by any Lender or the
Lessor which is attributable to periods prior to the date which is sixty (60)
days preceding the date on which the officer of the Lender or the Lessor having
primary responsibility for asset liability management shall have obtained actual
knowledge of such Change of Law or request or directive and written notice
thereof shall have been given to the Company. At any time within ninety (90)
days after payment by the Company, as Acquisition/Construction Agent for the
Lessor, of any material amount to any Lender pursuant to paragraph (a) or (b) of
this Section, so long as no Event of Default shall be in existence, the Company,
as Acquisition/ Construction Agent for the Lessor, may require by written notice
to that Lender that (i) it assign its pro rata share of the Commitment to
another Lender or to a bank or other financial institution selected by the
Company, as Acquisition/Construction Agent for the Lessor, and reasonably
acceptable to the Agent which is willing to accept such assignment or (ii) it
surrender its pro rata share of the Commitment and terminate its rights and
obligations as a Lender hereunder, concurrently with a reduction by the Company,
as Acquisition/Construction Agent of the Lessor, of the Commitment by an amount
equal to the pro rata share of the Commitment held by that Lender.
(b) If any Lender or the Lessor shall have determined that
after the date hereof the adoption of any applicable law, rule or regulation
regarding capital adequacy, or any change therein, or any change in the
interpretation or official administration thereof, or compliance by any Lender
or the Lessor (or its Applicable Funding Office) or any Person controlling such
Lender or the Lessor with any request or directive regarding capital adequacy
(whether or not having the force of law) of any Banking Authority, has or would
have the effect of reducing the rate of return on such Lender's or the Lessor's
or such controlling Person's capital as a consequence of its obligations
hereunder to a level below that which such Lender or the Lessor or such
controlling Person could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or the Lessor's or such
controlling Person's policies with respect to capital adequacy) by an amount
deemed by such Lender or the Lessor or such controlling Person to be material,
then from time to time, within 15 days after demand by such Lender or the Lessor
or such controlling Person, the Company, as Acquisition/Construction Agent for
the Lessor, shall pay to such Lender or the Lessor such additional amount or
amounts as will compensate such Lender or the Lessor or such controlling Person
for such reduction, subject to the proviso at the end of Section 5.03(a).
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(c) Each Lender or the Lessor will promptly notify the Lessor,
the Company and the Agent of any event of which its officer having primary
responsibility for asset liability management has knowledge, which occurs or is
expected to occur after the date hereof, which will entitle such Lender or the
Lessor to compensation pursuant to and subject to the limitations contained in
this Section and will designate a different Applicable Funding Office if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the reasonable judgment of such Lender or the Lessor, be
otherwise materially disadvantageous to such Lender or the Lessor. A certificate
of any Lender or the Lessor claiming compensation under this Section and setting
forth in reasonable detail the additional amount or amounts to be paid to it
hereunder shall be conclusive in the absence of manifest error. In determining
such amount, such Lender or the Lessor may use any reasonable averaging and
attribution methods. Nothing in this Section shall require any Lender or the
Lessor to disclose any information about its tax affairs or interfere with,
limit or abridge the right of any Lender or the Lessor to arrange its tax
affairs in any manner it desires, subject to Section 11.16(b).
(d) The provisions of this Section 5.03 shall (i) be
applicable with respect to any participant, Eligible Assignee or other
transferee, and any calculations required by such provisions shall be made based
upon the circumstances of such participant, Eligible Assignee or other
transferee (subject to Section 11.06(j)) and (ii) constitute a continuing
agreement and shall survive for a period of one year after the termination of
this Agreement and the payment or redemption in full or cancellation of the
Notes and the Lessor Investment.
Section 5.04 BASE RATE SUBSTITUTED FOR ADJUSTED LIBO RATE. If
(i) the obligation of any Lender or the Lessor to make or maintain Loans or
Lessor Investment Payments or its Lessor Investment has been suspended pursuant
to Section 5.02 or (ii) any Lender or the Lessor has demanded compensation under
Section 5.03, and the Company, as Acquisition/Construction Agent for the Lessor,
shall, by at least five (5) Business Days' prior notice to such Lender or the
Lessor through the Agent, have elected that the provisions of this Section shall
apply to such Lender or the Lessor, then, unless and until such Lender or the
Lessor notifies the Company, as Acquisition/Construction Agent for the Lessor,
that the circumstances giving rise to such suspension or demand for compensation
no longer apply:
(a) all Loans or Lessor Investment Payments that would
otherwise be made or maintained by such Lender or the Lessor based upon
the Adjusted LIBO Rate shall be made or, from the beginning of the next
Interest Period or Yield Period therefor, as applicable, be maintained
instead based upon the Base Rate, plus the Applicable Margin (in all
cases interest, Yield and principal or other amounts payable on such
Loans or Lessor Investment Payments shall be payable
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contemporaneously with the related or comparable amount
payable in respect of the other Lenders and the Lessor), and
(b) after each of its Loans or Lessor Investment Payments made
or maintained based upon the Adjusted LIBO Rate has been repaid, all
payments of principal that would otherwise be applied to repay such
Loans or Lessor Investment Payments, as applicable, shall be applied to
repay its Loans or Lessor Investment Payments made or maintained based
upon the Base Rate instead.
Section 5.05 COMPENSATION. Upon the request of any Lender or
the Lessor (delivered to the Lessor, the Company and the Agent), the Company, as
Acquisition/Construction Agent for the Lessor, shall pay to such Lender or the
Lessor such amount or amounts as shall compensate such Lender or the Lessor for
any loss, cost or expense incurred by such Lender or the Lessor as a result of:
(a) any payment or prepayment (pursuant to Section 5.02 or
otherwise) of a Loan or Lessor Investment Payment or any Lessor Investment on a
date other than the last day of the Interest Period or Yield Period, as
applicable, for such Loan, Lessor Investment Payment or Lessor Investment; or
(b) any failure by the Company, as Acquisition/ Construction
Agent for the Lessor, to borrow or take down (other than due to a refusal by the
Agent or any of the Lenders or the Lessor to fund under Section 2.02(a)
notwithstanding satisfaction of the conditions set forth in Article VI) a Loan
or Lessor Investment Payment on the date specified therefor in the applicable
Advance Notice delivered pursuant to Section 2.02(a), including any such failure
resulting from the revocation of such Advance Notice.
Section 5.06 PAYMENTS AND COMPUTATIONS. Each determination by
the Agent (or, in the case of Section 5.01, 5.02, 5.03, 5.04 or 5.05 by each
Lender with respect to its own Loans, or the Lessor with respect to the Lessor
Investment) of an interest rate or Yield, or an increased cost or increased
capital or of illegality hereunder shall be conclusive and binding for all
purposes (absent manifest error) if made reasonably and in good faith, subject
to Section 5.03(c).
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ARTICLE VI
Conditions Precedent
Section 6.01 CONDITIONS PRECEDENT TO EFFECTIVENESS OF THIS
AGREEMENT. This Agreement shall become effective when (i) it shall have been
executed by the Lessor, the Company and the Agent, (ii) the Agent and the
Company, as Acquisition/ Construction Agent for the Lessor, either shall have
been notified by each Lender that it has executed this Agreement or shall have
received a counterpart of this Agreement executed by such Lender, and (iii) the
Agent shall, on or before January 9, 1998 have received the following, each
being in form and substance satisfactory to the Agent and (except for the Notes)
in sufficient copies for each Lender:
(a) CERTIFICATES OF COMPANY AND GUARANTORS. Certificates of
the Secretary or Assistant Secretary of each of the Company and the Guarantors
setting forth (i) resolutions of its board of directors authorizing the
execution, delivery and performance of the obligations contained in this
Agreement, with respect to the Company, and the other Transaction Documents to
which it is a party, with respect to the Company and the Guarantors, (ii) the
officers of the Company and the Guarantors specified in such Secretary's
Certificates that are authorized to sign this Agreement and the other
Transaction Documents to which the Company or the Guarantors is a party and,
until replaced by another officer or officers duly authorized for that purpose,
to act as its respective representative for the purposes of signing documents
and giving notices and other communications in connection with this Agreement
and the Transaction Documents to which it is a party and (iii) true and correct
copies of the articles or certificate of incorporation and the bylaws of each of
the Company and the Guarantors. The parties to this Agreement may conclusively
rely on such certificate until the Agent (who shall promptly notify all other
parties) receives notice in writing from the Company or the Guarantors, as the
case may be, to the contrary.
(b) OPINION OF COMPANY'S AND GUARANTORS' COUNSEL. A favorable
opinion or opinions of Steel Hector & Davis, LLP special counsel to the Company
and the Guarantors, in substantially the form of EXHIBIT F, and as to such other
matters as any Lender, through the Agent, may reasonably request.
(c) EXECUTION OF NOTES. The Notes payable to the Lenders duly
completed and executed.
(d) EXECUTION AND DELIVERY OF TRANSACTION DOCUMENTS. Each of
the other Transaction Documents, including each of the Operative Guaranties,
duly completed and executed in sufficient number of counterparts for recording
where appropriate.
(e) RECORDATION OF SECURITY INSTRUMENTS. The Security
Instruments (to the extent filing thereof is required for
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perfection or otherwise under applicable law) and all related financing
statements and other requisite filing documents shall have been duly filed in
the appropriate offices and, to the fullest extent allowed by applicable law,
all costs and taxes associated with such filing shall have been paid or provided
for by the Company.
(f) RECEIPT OF FACILITY PLAN. The Agent shall have received a
copy of the Facility Plan.
(g) ENVIRONMENTAL MATTERS. The Agent and the Lessor shall have
received an Environmental Assessment, demonstrating to their reasonable
satisfaction that there is no evidence of any hazardous or toxic material or
substance which has been generated, treated, stored, released or disposed of on
the Site, and that there is no evidence of any violation of any Environmental
Requirement and no evidence of any Environmental Damages on or pertaining to the
Facility.
(h) SOIL TESTS. The Agent shall have received soil test
reports as to soil borings on the Site by a soil testing firm reasonably
satisfactory to the Lenders and the Lessor. The number and location of such
borings shall be in accordance with the recommendations of the soil testing firm
and also reasonably satisfactory to the Lenders and the Lessor. The report shall
include the recommendations of the soil testing firm as to the preparation of
the soil needed to adequately support the Facility.
(i) SURVEY. The Agent shall have received the Survey of the
Site.
(j) APPRAISAL. The Lenders and the Lessor shall have received
an Approved Appraisal of the Property, which Approved Appraisal shall be in form
and substance reasonably satisfactory to the Lenders and the Lessor, and shall
indicate that (i) as of the Lease Commencement Date, the estimated fair market
value of the Facility is not less than Facility Cost attributable to the
acquisition thereof, and (ii) the projected fair market value of the Facility as
of the expiration of (A) the Construction Term and (B) the Basic Term (in each
case after giving effect to the proposed improvements and enhancements to be
renovated or constructed on the Site in accordance with the Plan), is not less
than the Facility Cost.
(k) TITLE INSURANCE. The Title Policy.
(l) FEES. For the account of (i) the Lenders, pro rata, an
upfront fee, payable by the Lessee, in the aggregate amount of $30,000, and (ii)
to the Agent for the Agent's account and (ii) to the Lessor for the Lessor's
account, the fees specified in the fee letter dated August 25, 1997 between the
Lessor and the Lessee.
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(m) OTHER. Such other documents as the Agent or any Lender,
the Lessor or special counsel to the Agent may reasonably request.
Section 6.02 INITIAL AND SUBSEQUENT LOANS AND LESSOR
INVESTMENT PAYMENTS. The obligation of the Lenders and the Lessor to make the
Initial Loans, the Lessor Investment Payments and each subsequent Loan and
Lessor Investment Payment and to continue each Loan and Lessor Investment
Payment pursuant to this Agreement is subject to the following further
conditions precedent:
(a) RECEIPT OF ADVANCE NOTICE. The Agent shall have received
Advance Notice pursuant to a funding request with regard to each Initial Loan
and each Lessor Investment Payment, and thereafter, each Loan or allocation of
the proceeds of Lessor Investment Payments, containing the information required
by Section 2.02, which shall be true and correct and shall be duly and properly
executed and completed by the Company as Acquisition/Construction Agent for the
Lessor. Such Advance Notice shall specify the amount of the Loans and Lessor
Investment Payments being utilized or applied to acquire work in progress and
itemize such work in progress in reasonable detail.
(b) NO DEFAULT. The fact that immediately before and after
such Loan and Lessor Investment Payment, no Default or Event of Default shall
have occurred and be continuing.
(c) ACCURACY OF REPRESENTATIONS, ETC. The representations and
warranties of the Lessor and the Company contained in this Agreement, and the
representations and warranties of the Lessor, the Company and the Guarantors
contained in any other Transaction Document, are true and correct in all
material respects on and as of the date of such Loan or Lessor Investment
Payment, as the case may be (except for any representations which were correct
on the date of this Agreement but are not correct on the date of any Loan and
Lessor Investment Payment because of a change permitted by the terms of this
Agreement or any other Transaction Document or because they expressly relate to
an earlier date).
(d) TITLE. The Lessor shall have good and marketable title to
the Facility, and all of the Lessor's contract rights under Related Contracts
and all other contracts entered into in connection with the acquisition,
renovation, construction, development and/or installation of the Facility by the
Company as Acquisition/Construction Agent for the Lessor pursuant to the Agency
Agreement shall have been pledged to the Agent for the benefit of the Lenders so
that the Agent shall have a first priority, perfected Lien on all such contract
rights; and the Agent shall have received executed copies of all Related
Contracts requested by it.
(e) RECEIPT OF APPLICABLE PERMITS. All Permits that are or
will become Applicable Permits shall have been obtained,
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except Applicable Permits customarily obtained or which are permitted by
Governmental Requirements to be obtained after the date of the requested Loan or
Lessor Investment Payment (in which case the Company, having completed all
appropriate due diligence in connection therewith, shall have no reason to
believe that such Permits will not be granted in the usual course of business
prior to the date that such Permits are required by Governmental Requirements).
All such obtained Permits shall be in proper form, in full force and effect and
not subject to any appeal or other unsatisfied contest that may allow
modification or revocation thereof.
(f) CASUALTIES. The Facility shall not have suffered (i) a
Loss Event or (ii) a Casualty Occurrence other than a Casualty Occurrence for
which a plan reasonably acceptable to the Agent for replacing, or causing to be
replaced, the portions of the Facility that are the subject of such Casualty
Occurrence has been provided to the Lessor.
(g) NO MATERIAL ADVERSE CHANGE OR EFFECT. No material adverse
change shall have occurred in the financial condition of the Company and its
Subsidiaries on a consolidated basis since the date of the most recent Fiscal
Quarter for which a financial statement of the Company was delivered to the
Agent and the Lenders and the Lessor and no event, act, condition or occurrence
shall exist or have occurred that has had, or would reasonably be expected to
have, a Material Adverse Effect.
(h) TAXES, FILINGS, RECORDINGS. All filings or recordings
reasonably considered necessary or desirable by the Agent, any Lender or the
Lessor have been completed and all taxes and fees in connection therewith, and
all Impositions with respect to the Facility that are then due and payable,
shall have been paid by the Company or, subject to Section 8.15, are being
contested in good faith by appropriate proceedings.
Each acceptance of a funding hereunder shall be deemed to be a representation
and warranty by the Company on the date of such funding as to the facts
specified in subsections (b), (c), (d), (e), (f), (g), and (h) of this Section
6.02.
Section 6.03 CONDITIONS PRECEDENT FOR THE BENEFIT OF LENDERS
AND THE LESSOR. All conditions precedent to the obligations of the Lenders and
the Lessor to make any Loan or Lessor Investment Payment are imposed hereby
solely for the benefit of the Lenders and the Lessor, and no other Person may
require satisfaction of any such condition precedent or be entitled to assume
that the Lenders and the Lessor will refuse to make any Loan or Lessor
Investment Payment in the absence of strict compliance with such conditions
precedent.
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Section 6.04 CLOSING. On the Closing Date (or in the case of
clause (b), as soon thereafter as the applicable closing conditions shall have
been satisfied), at such place as the parties hereto shall agree:
(a) this Agreement and each of the Transaction Documents shall
be duly executed and delivered by the parties to such documents; and
(b) subject to the satisfaction of the conditions precedent
specified in Section 6.01 and Section 6.02 of this Agreement, the Lenders shall
make the Initial Loans in the amounts set forth in the Advance Notice given by
the Company, and the Lessor shall make Lessor Investment Payments in an
aggregate amount equal to the Lessor Investment Commitment, in immediately
available funds to the account of the Lessor at such account of the Lessor as
the Company, as Acquisition/Construction Agent for the Lessor, may direct.
ARTICLE VII
Representations and Warranties
Section 7.01 COMPANY REPRESENTATIONS AND WARRANTIES. The
Company represents and warrants to each Person who now is or hereafter becomes a
party to this Agreement (except to the extent qualified by supplemental
disclosure set forth on SCHEDULE A) that:
(a) CORPORATE STANDING AND POWER. The Company and each
Guarantor is a duly organized and validly existing corporation in good standing
under the laws of its jurisdiction as set forth on SCHEDULE A and is duly
qualified or licensed as a foreign corporation in good standing in each
jurisdiction in which the failure to do so would have a Material Adverse Effect.
(b) CORPORATE AUTHORITY; NONCONTRAVENTION. The execution,
delivery and performance of this Agreement and the other Transaction Documents
are within the corporate powers of the Company and have been duly authorized by
all necessary corporate action. Neither the execution, delivery or PERFORMANCE
of this Agreement or any other Transaction Document, nor consummation of the
contemplated transactions will contravene any law, statute, rule or regulation
to which the Company is subject or any judgment, decree, franchise, order or
permit applicable to the Company, or will conflict or be inconsistent with or
will result in any breach of, or constitute a default under, or result in or
require the creation or imposition of any Lien (other than the liens created by
the Transaction Documents) upon any of the property or assets of the Company
pursuant to any Contractual Obligation, or violate any provision of the
corporate charters or by-laws of the Company. No order, permission, consent,
approval, license, authorization, registration or validation of, or filing with,
or exemption by, any Governmental Authority or any other
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Person is required to authorize, or is required in connection with, the
execution, delivery and performance of this Agreement or any other Transaction
Document by the Company, or the taking of any action contemplated hereby or
thereby (except for such filings as may be necessary to create or perfect the
Liens contemplated by the Transaction Documents). Neither the Company nor any of
its Subsidiaries is (after taking into account applicable cure periods) in
default under any Contractual Obligation (including any Contractual Obligation
relating to any Indebtedness of the Company) where such default could reasonably
be anticipated to have a Material Adverse Effect.
(c) BINDING AGREEMENT. This Agreement and each other
Transaction Document constitutes valid and binding obligations of the Company
enforceable against the Company in accordance with its terms, except as may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting the enforcement of creditors' rights generally and subject
to general principles of equity, whether applied in a court of equity or at law.
(d) FINANCIAL CONDITION. (i) The Company has furnished the
Agent with complete and correct copies of the audited consolidated balance sheet
of the Company and its Subsidiaries as of the December 31, 1996, and the related
audited consolidated statements of income and of cash flows for the fiscal year
of the Company and its Subsidiaries ended on such date, examined by the
Accountants, and the Company's 10Q for the fiscal quarter ended September 30,
1997. Such financial statements (including the related schedules and notes)
taken together with the Audited Pooled Combined Proforma Financial Statements
included in SCHEDULE A (the "Pooled Combined Statements") fairly present the
consolidated financial condition of the Company and its Subsidiaries as of
December 31, 1996, and the consolidated results of their operations and their
consolidated cash-flows for the fiscal year then ended.
(ii) Neither the Company nor any of its Subsidiaries have any
material liabilities, contingent or otherwise, including liabilities for taxes
or any unusual forward or long-term commitments or any Guarantee, which are not
disclosed by or included in the above-referenced financial statements or the
accompanying notes, taken together with the Pooled Combined Statements, and
there are no unrealized or anticipated losses from any unfavorable commitments
of the Company or any of its Subsidiaries which may have a Material Adverse
Effect. During the period from the Financial Statements Date to the date hereof:
(i) there has been no sale, transfer or other disposition by the Company or any
of its Subsidiaries of any material part of their business or property and,
other than the acquisitions of Staff Administrators, Inc. and Amstaff, Inc., no
purchase or other acquisition of any business or property (including any capital
stock of any Person) material in relation to the consolidated financial
condition of the Company and its Subsidiaries at the Financial Statements Date;
and (ii) neither the Company nor any
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of their Subsidiaries have made a Restricted Payment, or agreed or committed to
make a Restricted Payment.
(iii) All the above-referenced financial statements (including
the related schedules and notes) have been prepared in accordance with GAAP
applied consistently throughout the periods involved (except as approved by the
Accountants and disclosed therein and, in the case of interim financial
statements, subject to normal year-end adjustments and the absence of footnotes
and schedules).
(iv) Since the Financial Statements Date (other than as
reflected by the Pooled Combined Statements) there has been no development or
event, or to the best knowledge of the Company, any prospective development or
event, which has had or could reasonably be anticipated to have a Material
Adverse Effect. Since the date hereof, no event, condition or other development
has occurred relating to any matter disclosed on SCHEDULE A that has, or could
reasonably be expected to have, a Material Adverse Effect. The Company is not
party to or bound by any contract, agreement or instrument, nor subject to any
charter or other corporate restriction which will, under current or foreseeable
conditions, have a Material Adverse Effect.
(e) LITIGATION DECLARATION. Except as set forth in SCHEDULE A,
there are no actions, suits or proceedings pending or threatened against or
affecting the Company or any of its Subsidiaries which in any one case or in the
aggregate, if determined adversely to the interests of such party, could
reasonably be anticipated to have a Material Adverse Effect.
(f) COMPLIANCE WITH ERISA. The Company and each member of the
Controlled Group have fulfilled their obligations under the MINIMUM funding
standards of ERISA and the Code with respect to each Plan and are in compliance
in all material respects with the presently applicable provisions of ERISA and
the Code, and have not incurred any liability to the PBGC or a Plan under Title
IV of ERISA (other than to make contributions or premium payments in the
ordinary course).
(g) COMPLIANCE WITH LAWS. Neither the Company nor any of its
Subsidiaries is in default and/or in violation of any applicable statute, rule,
writ, injunction, decree, order or regulation of any Governmental Authority
having jurisdiction over the Company or its Subsidiaries which default or
violation could reasonably be anticipated to have a Material Adverse Effect.
(h) TAXES. All tax returns of the Company and its Subsidiaries
required to be filed have been timely filed, all material taxes, fees and other
governmental charges (other than those being contested in good faith by
appropriate proceedings diligently conducted and with respect to which adequate
reserves have been established and, in the case of AD VALOREM taxes or
betterment assessments, no proceedings to foreclose any lien with respect
thereto have been commenced and, in all other cases, no
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notice of lien has been filed or other action taken to perfect or enforce such
lien) shown thereon which are payable have been paid. The charges and reserves
on the books of the Company and its Subsidiaries for all income and other taxes
are adequate, and the Company knows of no additional assessment or any basis
therefor. The Federal income tax returns of the Company and its Subsidiaries
have not been audited within the last three years, all prior audits have been
closed, and there are no unpaid assessments, penalties or other charges arising
from such prior audits.
(i) INVESTMENT COMPANY STATUS; LIMITS ON ABILITY TO INCUR
INDEBTEDNESS. The Company 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. The Company is not subject to regulation under
any Federal or State statute or regulation which limits its ability to incur
Indebtedness.
(j) OWNERSHIP OF PROPERTY; LIENS. Except as set forth in
SCHEDULE A, the Company has good and marketable title to all of its properties
and assets, including the properties and assets reflected in the consolidated
balance sheet of the Company as of the Financial Statements Date, except such as
have been disposed of since that date in the ordinary course of business, and
none of such properties or assets is subject to any Lien except for (a)
Permitted Liens, or (b) a defect in title or other claim other than defects and
claims that, in the aggregate, would have no Material Adverse Effect. The
Company enjoys peaceful and undisturbed possession under all leases necessary in
any material respect for the operation of their properties and assets and no
material default exists under such leases (after taking into account applicable
cure periods under said leases). All such leases are valid and subsisting and
are in full force and effect.
(k) NO DEFAULTS. As of the date of this Agreement, no Default
exists.
(l) DISCLOSURE. None of the representations and warranties
made by the Company in this Agreement, or in any other document furnished to the
Agent or the Lenders by or on behalf of the Company in connection herewith
contains (or will contain on the Closing Date) any untrue statement of material
fact or omits (or will omit on the Closing Date) to state any material fact
necessary to make the statements herein or therein, in light of the
circumstances under which they are made, not misleading. There is no fact known
to the Company on the date of this Agreement which has any reasonable likelihood
of having a Material Adverse Effect which has not been set forth in or referred
to in this Agreement.
(m) COMPLIANCE WITH ENVIRONMENTAL LAWS. (i) The Company and
all of its Subsidiaries have obtained all Governmental Approvals that are
required for the operation of their business under any Environmental Law, except
where the
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failure to so obtain a Governmental Approval would not have a Material Adverse
Effect.
(ii) The Company and all of its Subsidiaries are in compliance
with all terms and conditions of all required Governmental Approvals and are
also in compliance with all terms and conditions of all applicable Environmental
Laws, noncompliance with which would have a Material Adverse Effect.
(iii) There is no civil, criminal or administrative ac tion,
suit, demand, claim, hearing, notice of violation, investigation, proceeding,
notice or demand letter pending or, to the best knowledge of the Company
threatened against the Company or any of its Subsidiaries relating in any way to
the Environmental Laws, and there is no Lien of any private entity or
Governmental Authority against any property of the Company or any Subsidiary
thereof relating in any way to the Environmental Laws.
(iv) There has been no claim, complaint, notice, or request
for information received by the Company with respect to any site listed on the
National Priority List promulgated pursuant to CERCLA or any state list of sites
requiring investigation or cleanup with respect to contamination by Hazardous
Substances.
(v) To the best of the Company's knowledge, there has been no
release or threat of release of any Hazardous Materials at any Property owned by
the Company which would likely result in liability being imposed upon the
Company or any Subsidiary thereof, which liability would have a Material Adverse
Effect.
(n) CAPITAL STOCK. All Capital Stock, debentures, bonds, notes
and all other securities of the Company presently issued and outstanding are
validly and properly issued in accordance with all applicable laws in all
material respects, including but not limited to, the "Blue Sky" laws of all
applicable states and the federal securities laws.
(o) USE OF PROCEEDS; MARGIN STOCK. The proceeds of the Loans
and the Lessor Investment Payments are being used to finance or refinance the
Facility Cost with respect to the Facility, including the enhancements and
improvements to be made thereto and the design, renovation, construction and
installation thereof. Neither the Company nor the Lessor is engaged principally,
or as one of its important activities, in the business of purchasing or carrying
any Margin Stock, and no part of the proceeds of any Loan or Lessor Investment
Payment will be used to purchase or carry any Margin Stock or to extend credit
to others for the purpose of purchasing or carrying any Margin Stock, or be used
for any purpose which violates, or which is inconsistent with, the provisions of
Regulations G, T, U or X.
(p) SOLVENCY. The Company has and, after giving effect to the
Company's incurrence of its obligations under the Lease and the Operative
Guaranties, will have, assets (both tangible
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and intangible) having a fair saleable value in excess of the amount required to
pay the probable liability on its then existing debts (whether matured or
unmatured, liquidated or unliquidated, fixed or contingent); the Company has and
will have access to adequate capital for the conduct of its business and the
discharge of its debts incurred in connection therewith as such debts mature;
the Company was not insolvent immediately prior to the Company's incurrence of
its obligations under the Lease, and immediately after giving effect thereto,
the Company will not be insolvent.
(q) FACILITY PLAN. The Facility Plan has been prepared in good
faith on the basis of assumptions deemed reasonable by the Company and
accurately reflects in all respects all material costs currently anticipated to
be incurred in connection with achieving Completion. The Facility Plan sets
forth the Company's good faith estimation of the schedule for achieving
Completion. All material agreements and instruments comprising the Facility Plan
are in full force and effect and the Company is not in default of its
obligations thereunder in any respect that would reasonably be expected to have
a Material Adverse Effect. To the best knowledge of the Company, there are no
agreements, instruments, licenses or other rights necessary to own, operate,
lease or use the Facility the failure to obtain which would reasonably be
expected to result in a Material Adverse Effect, other than the Applicable
Permits, the documents and instruments comprising the Facility Plan, and the
Transaction Documents; and renovation, construction, ownership, operation,
leasing or use of the Facility by the Company (and after the expiration or
termination of the Lease, the renovation, construction, ownership, operation,
leasing or use of the Facility by the Lessor or its successors or assigns) does
not and will not infringe on, or otherwise violate, any patents, patent
applications, trademarks (whether registered or not), trademark applications,
trade names, proprietary computer software, or copyrights of any Person in any
manner that would reasonably be expected to have a Material Adverse Effect.
(r) INSURANCE. The Company and each of its Subsidiaries has
(either in the name of the Company or in such Subsidiary's own name), with
financially sound and reputable insurance companies, insurance in at least such
amounts and against at least such risks (including on all its property, and
public liability and worker's compensation) as are usually insured against in
the same general area by companies of established repute engaged in the same or
similar business.
(s) LABOR RELATIONS. There is (i) no unfair labor practice
complaint pending against the Company or any of its Subsidiaries or, to the best
knowledge of the Company, threatened, before the National Labor Relations Board,
and no grievance or arbitration proceeding arising out of or under any
collective bargaining agreement is so pending against the Company or any of its
Subsidiaries or, to the best knowledge of the Company, threatened, except for
such complaints, grievances or
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arbitration proceedings which, if adversely decided, would not have a Material
Adverse Effect, (ii) no strike, labor dispute, slow down or stoppage is pending
against the Company or any of its Subsidiaries or, to the best knowledge of the
Company, threatened against the Company or any of its Subsidiaries, except for
any such labor action as would not have a Material Adverse Effect, and (iii) to
the best knowledge of the Company, no union representation question is existing
with respect to the employees of the Company or any of its Subsidiaries and, to
the best knowledge of the Company, no union organizing activities are taking
place, except for any such question or activities as would not have a Material
Adverse Effect.
(t) INTELLECTUAL PROPERTY. The Lessee and the Guarantors own
or license such copyrights, patents, trademarks and similar rights
("INTELLECTUAL PROPERTY") as are necessary for the conduct of their respective
businesses as now conducted, without any known conflict with the rights of
others which would have a Material Adverse Effect. Following the occurrence and
during the continuance of an Event of Default, the Lessee and the Guarantors,
upon the request of the Agent, shall make reasonably diligent efforts to prepare
and deliver to the Agent a reasonably detailed listing of all such Intellectual
Property, provided that nothing herein shall require the registration of any
such Intellectual Property.
Section 7.02 REPRESENTATIONS AND WARRANTIES OF LESSOR.
Lessor represents and warrants to the Company, the Agent and the
Lenders that:
(a) EXISTENCE. The Lessor is a corporation duly organized,
validly existing and in good standing under the laws of the State of Rhode
Island.
(b) LITIGATION. There is no action, suit or proceeding
pending, or to the knowledge of the Lessor, threatened, against or affecting the
Lessor before any court or arbitrator or any governmental body, agency or
official which contests the validity or enforceability of the Transaction
Documents or which in any manner draws into question the validity of or could
impair in any material respect the ability of the Lessor to perform its
obligations under this Agreement or any of the Transaction Documents executed by
it.
(c) NO BREACH. The execution and delivery of this Agreement,
the Notes and the other Transaction Documents, the transactions herein and
therein contemplated and compliance with the terms and provisions hereof and
thereof will not conflict with, or result in a breach of, or require any consent
of any Person not already obtained, under the charter or bylaws of the Lessor,
or any Governmental Requirement of the State of the Lessor or its state of
incorporation or the United States of America or any other governmental
authority governing its banking and trust powers, or any agreement or instrument
to which the Lessor is a party or by which it is bound or to which it is
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subject, or constitute a default under any such agreement or instrument, or
result in the creation or imposition of any Lien (except under the Transaction
Documents and other Permitted Liens) upon any of the revenues or Properties of
the Lessor, including the Facility, pursuant to the terms of any such agreement
or instrument.
(d) ACTION. The Lessor has all necessary corporate power and
authority to execute, deliver and perform its obligations under this Agreement,
the Notes, the other Transaction Documents to which it is a party; and the
execution, delivery and performance by it of this Agreement, the Notes, the
other Transaction Documents to which it is a party have been duly authorized by
all necessary corporate action on its part; and this Agreement, the Notes and
the other Transaction Documents constitute the legal, valid and binding
obligations of the Lessor, enforceable against it in accordance with their
terms, except as may be limited by any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights generally
or by general principles of equity.
(e) APPROVALS. No authorizations, approvals or consents of,
and no filings or registrations with, the United States of America or any other
governmental authority governing its banking and trust powers are necessary for
the execution, delivery or performance by the Lessor of this Agreement, the
Notes, the other Transaction Documents to which it is a party, or for the
validity or enforceability thereof.
(f) OWNERSHIP OF FACILITY. As of the Initial Funding Date, the
Lessor owns legal and beneficial title to 100% of the record title interest in
and to the Site, free and clear of all Liens except Permitted Liens and the
interest of the Company under the Lease. None of the Permitted Liens will
interfere with the use or possession of the Facility or the use of or exercise
by the Lessor of its rights under any Transaction Document or with respect to
the Facility, except to the extent such interference would not be reasonably
expected to have a Material Adverse Effect.
ARTICLE VIII
Covenants
The Company covenants and agrees with the Agent, the Lessor and each
Lender to comply with the following covenants until either (i) the Facility has
been purchased by the Company (or one of its Affiliates) for the Purchase Price,
or (ii) the Lease has been terminated, the Facility has been returned to the
Lessor and the Termination Value or the Final Rent Payment or the Completion
Costs Payment, as the case may be, and all other amounts payable under the Lease
and the other Transaction Documents upon such occurrence have been paid in full,
and the Lessor, with respect to itself, covenants and agrees with the Agent and
each Lender to
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comply with the following covenants until all amounts payable under this
Agreement have been paid in full:
Section 8.01 INFORMATION. The Company will deliver to the
Agent, the Lessor and each of the Lenders:
(a) within forty-five (45) days after the end of each fiscal
quarter of the Company (other than the fourth quarter), the unaudited
consolidated and consolidating balance sheet and income statement and statement
of cash flows of the Company and its Subsidiaries as at and for the three-month
period ended on the last day of such fiscal quarter, accompanied by a
certificate of a Responsible Officer of the Company to the effect that such
financial statements fairly present the consolidated financial condition of the
Company and its Subsidiaries as of the end of such fiscal quarter, and the
consolidated results of their operations and their consolidated cash flows for
such fiscal quarter, in each case in accordance with GAAP (except for the
absence of footnotes) consistently applied (subject to normal year-end audit
adjustments);
(b) within one hundred twenty (120) days after the last day of
each fiscal year of the Company, the audited consolidated balance sheet and
income statement and statement of cash flows of the Company and its Subsidiaries
as at and for the fiscal year then ended, certified by the Accountants with an
unqualified opinion, the substance of such report to be reasonably satisfactory
to the Agent, together with the unaudited consolidating balance sheet and income
statement and statement of cash flows of the Company and its Subsidiaries as at
and for the year then ended and, following any change from the Company's
existing, guaranteed-cost workers compensation insurance coverage, an actuarial
review detailing the calculations of workers' compensation reserves for claims,
accompanied by a certificate of a Responsible Officer of the Company to the
effect that such financial statements fairly present the consolidated financial
condition of the Company and its Subsidiaries as of the end of such fiscal year
and the consolidated results of their operations for such fiscal year, in each
case in accordance with GAAP. Said financial statements shall indicate all
Guarantees or unusual forward or long-term commitments made by the Company or
any Subsidiaries thereof.
(c) at the time of the delivery of the quarterly and yearly
financial statements required by Sections 8.01(a) and (b) above, a Compliance
Certificate signed by a Responsible Officer of the Company in the form attached
to this Agreement as EXHIBIT H, appropriately completed;
(d) copies of any management letter provided by the
Accountants to the Company;
(e) promptly upon becoming aware of any litigation or other
proceeding against the Company or any of its Subsidiaries
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that could reasonably be expected to have a Material Adverse Effect, notice
thereof;
(f) within thirty (30) days prior to the commencement of each
fiscal year of the Company, a copy of the consolidated operating budget,
including, without limitation, projections of the anticipated cash flow of the
Company and its Subsidiaries for such fiscal year and a statement of the
assumptions on which such budget was prepared;
(g) promptly following the request of the Agent, the Lessor,
or any Lender, such further information concerning the business, affairs and
financial condition or operations of the Company and its Subsidiaries as the
Agent, the Lessor or any Lender may reasonably request;
(h) promptly upon the mailing thereof to the shareholders of
the Company generally, copies of all financial statements, reports, proxy
statements and other materials;
(i) within ten (10) Business days after each and every fiscal
quarter, commencing on the fiscal quarter ended December 31, 1997, until the
Completion Date, furnish to the Agent a Progress Report through the period
ending on such fiscal quarter and dated as of the last day of such or fiscal
quarter; and
(j) promptly upon the filing thereof by the Company with the
SEC (and in any event within ten (10) days of such filing), copies of any
registration statements and reports on Forms 10-K, 10-Q and 8-K (or their
equivalents if such forms no longer exist).
Section 8.02 NOTICE OF DEFAULT, LOSS EVENT OR CASUALTY
OCCURRENCE. (a) As soon as practicable, and in any event, within three (3)
Business Days of becoming aware of the existence of any condition or event which
constitutes a Default or Event of Default hereunder, the Company will provide
the Agent, the Lessor and each Lender with written notice which shall have the
caption of "Notice of Default", specifying the nature and period of existence
thereof and what action the Company is taking or proposes to take with respect
thereto.
(b) Promptly upon becoming aware of the occurrence of either a
Loss Event or a Casualty Occurrence, or any other event or condition requiring
notice under of the Lease, the Company shall give the Agent, the Lessor and each
Lender written notice thereof, which notice shall specify the damage or loss to
the Facility in reasonable detail.
Section 8.03 INSPECTION OF PROPERTY, BOOKS AND RECORDS. The
Company will permit a representative of the Agent, the Lessor and any Lender
(including any field examiner or auditor retained by) to inspect the Facility
and make copies of the Company's books and records at any of the Company's
locations, and to discuss its affairs, finances and accounts with
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its officers and Accountants, at such reasonable times and places and as often
as the Agent, the Lessor or any Lender may reasonably request at the Company's
expense. The Company will keep books of record and account regarding the Lease
and shall maintain, on a current basis, books of proper record and account in
conformity with GAAP, consistently applied (to the extent applicable), which
books shall include copies of all Related Contracts and any amendments thereto
and the book value of the Facility and of each material item of Property
comprising or included in the Facility, and shall provide copies of the
foregoing to the Lessor, the Agent and the Lenders from time to time on request
at the Company's expense. The Company will keep proper books of record and
account in which full, true and correct entries in conformity with GAAP shall be
made of all dealings and transactions in relation to its business and
activities. The Company agrees to cooperate and assist in such visits and
inspections, in each case at such reasonable times and as often as may
reasonably be desired.
Section 8.04 CONDUCT OF BUSINESS; MAINTENANCE OF EXISTENCE.
The Company will, and will cause each of its Subsidiaries to, continue to engage
in the business in which it is engaged and maintain its existence and comply
with all applicable statutes, rules and regulations and remain duly qualified as
a foreign corporation, licensed and in good standing in each jurisdiction where
such qualification or licensing is required by the nature of its business, the
character and location of its property, business, or the ownership or leasing of
its property, except where such noncompliance or failure to so qualify would not
have a Material Adverse Effect, and the Company will, and will cause each of its
Subsidiaries to, maintain its properties in good operating condition, and
continue to conduct its business as presently conducted.
Section 8.05 DISSOLUTION. The Company shall not suffer or
permit dissolution or liquidation either in whole or in part or redeem or retire
any shares of its own stock, except through corporate reorganization to the
extent permitted by Section 8.13.
Section 8.06 USE OF PROCEEDS. The proceeds of the Loans and
Lessor Investment Payments will be used to fund the Facility Cost. Without
limiting the generality of the foregoing, no portion of the proceeds of the
Loans or the Lessor Investment Payments will be used by the Lessor or the
Company (i) in connection with, whether directly or indirectly, any tender offer
for, or other acquisition of, stock of any corporation with a view towards
obtaining control of such other corporation, except in a negotiated, consensual
transaction (ii) directly or indirectly, for the purpose, whether immediate,
incidental or ultimate, of purchasing or carrying any Margin Stock, or (iii) for
any purpose in violation of any applicable Governmental Requirement.
Section 8.07 COMPLIANCE WITH LAWS; PAYMENT OF TAXES. The
Company will comply, and will cause its Subsidiaries to
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comply, in all material respects with applicable laws (including but not limited
to ERISA), regulations and similar requirements of governmental authorities
(including but not limited to PBGC), except where the necessity of such
compliance is being contested in good faith through appropriate proceedings or
where the failure to comply would not reasonably be expected to have or cause a
Material Adverse Effect. The Company will pay, prior to the date on which
penalties attach thereto, all taxes, assessments, governmental charges, claims
for labor, supplies, rent and other obligations which, if unpaid, might become a
lien against the Facility or against Property of the Company, except liabilities
being contested in good faith and against which, if requested by the Agent, the
Company will set up reserves in accordance with GAAP and other than taxes,
assessments, governmental charges and other amounts which are not material in
amount and could not reasonably be expected to have a Material Adverse Effect.
Section 8.08 INSURANCE. The Company will maintain (either in
the name of the Lessor or the Company, as applicable), with financially sound
and reputable insurance companies, insurance on such of its property in at least
such amounts, and with such deductibles, and against at least such risks as are
usually insured against in the same general area by companies of established
repute engaged in the same or similar businesses. Without limitation of the
foregoing, the Company shall maintain or cause to be maintained, with Permitted
Insurers, insurance with respect to the Facility and its business in connection
therewith of the types and in the amounts specified in the Lease. The Company
will deliver or cause to be delivered to the Agent and the Lessor promptly upon
request of Agent, and in any event on January 1st of each calendar year,
commencing with January 1, 1999, a report by a firm of independent insurance
brokers or consultants chosen by the Company and acceptable to the Agent (a)
setting forth the insurance or self-insurance obtained pursuant to the Lease,
including, without limitation, the amounts thereof, the names of the insurers
and the property, hazards and risks covered thereby, and certifying that the
same comply with the requirements of the Lease, that all premiums then due and
payable thereon have been paid and that the same are in full force and effect,
that the Lessor and the Agent have been named as additional insureds and loss
payees, as their interests may appear, under each such policy, and are not
liable for payment of premiums thereunder, that such policies may not be
cancelled without at least 30 days prior notice to the Lessor and the Agent with
an opportunity to cure any default thereunder, and (b) certifying that in the
opinion of such firm, such insurance or self-insurance complies with the
requirements of the Lease and, as to amounts, coverage and provisions,
constitutes reasonable and customary coverage against risks customarily insured
against which would affect the Facility, or setting forth any recommendations of
such independent insurance brokers or consultants as to additional insurance, if
any, reasonably required for the protection of the interests of the Company, the
Lessor, the Agent and the Lenders in light of available insurance
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coverage and practice in the business engaged in by the Company at the Facility.
The Agent shall be entitled to rely on such reports without further
investigation of the facts and circumstances set forth therein.
Section 8.09 MAINTENANCE OF PROPERTY. The Company shall
maintain and preserve the Facility in accordance with the requirements of the
Lease. The Company shall maintain and preserve all of its properties and assets,
in good condition, repair and working order, ordinary wear and tear excepted.
Section 8.10 ENVIRONMENTAL NOTICES. The Lessor, or the
Company, for itself and as Acquisition/Construction Agent for the Lessor, shall
furnish to the Agent prompt written notice of all Environmental Liabilities,
pending or threatened Environmental Proceedings, Environmental Notices,
Environmental Judgments and Orders, and Environmental Releases of which the
Lessor or the Company shall have received actual notice or have actual knowledge
at, on, in, under or in any way affecting the Facility or any of its Properties,
and Properties of any Subsidiary, or any adjacent property, if the amount of
liability or of remediation cost to the Lessor, the Company, or any Subsidiary
is or could reasonably be expected to have a Material Adverse Effect, and all
facts, events, or conditions actually known to the Lessor or the Company that
could reasonably be expected to lead to any of the foregoing.
Section 8.11 ENVIRONMENTAL MATTERS. The Company shall not, and
shall not knowingly permit any Third Party to, use, produce, manufacture,
process, treat, recycle, generate, store, dispose of, manage at, or otherwise
handle, or ship or transport to or from the Facility or the Properties any
Hazardous Materials except for Hazardous Materials such as cleaning solvents,
pesticides and other similar materials used, produced, manufactured, processed,
treated, recycled, generated, stored, disposed of, managed, or otherwise handled
in minimal amounts in the ordinary course of business or of management or
maintenance of the Facility or the Properties in material compliance with all
applicable Environmental Requirements, and will take commercially reasonable
steps to prohibit any Third Party from doing any of the acts prohibited by the
foregoing.
Section 8.12 ENVIRONMENTAL RELEASE. The Company agrees that
upon its becoming aware of the occurrence of an Environmental Release, except
for any Environmental Release which occurred in substantial compliance with all
Environmental Requirements, at or on the Facility or any of the Properties owned
or operated by it or any Material Subsidiary, it will act promptly to determine
the extent of, and to take appropriate remedial action to eliminate, any such
Environmental Release, whether or not ordered or otherwise directed to do so by
any Environmental Authority, except to the extent that failure to take remedial
action would not have a Material Adverse Effect.
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Section 8.13 CONSOLIDATIONS, MERGER OR ACQUISITION. (a)
Neither the Company nor any of the Guarantors shall merge or consolidate with or
into any other Person, or make any acquisition of the business or assets of any
other Person except: (i) any Guarantor may merge into the Company or any other
Guarantor; (ii) Investments to the extent permitted by Section 8.17; (iii) the
purchase of office supplies and other consumable assets acquired in the ordinary
course of business; and (iv) Permitted Acquisitions.
(b) In addition to the requirements set forth in Section
8.13(a), the following additional conditions must be satisfied with respect to
each Permitted Acquisition:
(i) Any company, business or Person to be acquired
shall be engaged primarily in the same or a
related line of business to the then current
business conducted by the Lessee and the
Guarantors and shall have Adjusted EBITDA, with
adjustments reasonably acceptable to the Agent for
the twelve months immediately preceding the
proposed acquisition dates, greater than $1.00;
provided that in the case of an asset acquisition
such determination of the Adjusted EBITDA in
respect of such assets shall be made on a proforma
basis as if such assets and related liabilities
were assets and related liabilities belonging to a
Person to be acquired by the Company or any of the
Guarantors;
(ii) The Company and the Guarantors shall have
demonstrated, to the reasonable satisfaction of the
Agent, that on a pro forma basis and after giving
effect to the proposed acquisition, the Company and
the Guarantors will be in compliance with the
financial covenants set forth in Sections 8.20
through 8.24 hereof.
(iii) All necessary consents, approvals, licenses,
permissions, registrations or validations of any
Governmental Authority or any Person required for the
consummation of the proposed acquisition shall have
been obtained and shall be in full force and effect;
(iv) Prior written consent of all of the Lenders (any
request for such consent to be acted upon by the
Lenders within five Business Days after their
receipt of such request, together with the other
materials and information referenced herein) shall
have been obtained with respect to: (A) any
individual acquisition involving cash
consideration (including assumption of any
Indebtedness, or the issuance of any Seller Debt)
in excess of $10,000,000 or total consideration in
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excess of $25,000,000, and (B) any proposed
acquisition during any Fiscal Year to the extent that
the aggregate cash consideration paid by the Company
or the Guarantors (including assumption of any
Indebtedness, or the issuance of any Seller Debt) for
acquisitions completed during such fiscal year
exceeds $20,000,000 (taking into account the proposed
acquisition), unless such proposed acquisition
involves less than $1,000,000 in cash consideration
(including assumption of any Indebtedness, or the
issuance of any Seller Debt);
(v) Each new Subsidiary of the Company formed to make
such acquisition and each Person to be acquired which
becomes a Subsidiary of the Company shall become a
Guarantor pursuant to Section 8.33; and
(vi) The Agent and its counsel shall have received copies
of the acquisition agreement and such other documents
and information relating to the proposed acquisition
as the Agent or its counsel may reasonably request.
8.14 DISPOSITION OF ASSETS. The Company and the Guarantors
shall not convey, sell, lease, transfer or otherwise dispose of any of their
property, business or assets (including without limitation, accounts receivable
and leasehold assets), whether now owned or hereafter acquired, except for (i)
obsolete or worn out property disposed of in the ordinary course of business
(with standard discounts); (ii) the sale of inventory in the ordinary course of
business; (iii) other assets (excluding accounts receivable which may not be
disposed of), PROVIDED that the aggregate fair value of all assets disposed of
pursuant to this clause (iii) in any year shall not exceed five percent (5%) of
the consolidated total assets of the Company and the Guarantors as of the end of
any such year; (iv) the sale of the Excluded Property; and (v) the sale or other
disposition of assets acquired in connection with any Permitted Acquisition,
which assets are not used or useable in, or are otherwise not related to, the
same or related line of business as the business conducted by the Company and
the Guarantors.
Section 8.15 LIENS, ETC. The Company covenants and agrees that
it shall not create, assume or suffer to exist, any Liens upon any Property now
owned or hereafter acquired by it or upon the Facility, except for Permitted
Liens.
Section 8.16 RESTRICTED PAYMENTS. Neither the Company or any
of its Subsidiaries shall declare or make any Restricted Payment.
Section 8.17 INVESTMENTS. Neither the Company or any of its
Subsidiaries shall make, maintain or acquire any Restricted Investment in any
Person other than:
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(a) marketable obligations issued or guaranteed by the United
States of America having a maturity of one year or less from the date of
purchase;
(b) certificates of deposit, Eurodollar time deposits,
commercial paper or any other obligations of any lender or of any other bank or
trust company organized or licensed to conduct a banking business under the laws
of the United States or any State thereof and which has (or which is a
Subsidiary of a bank holding company which has) publicly traded debt securities
rated A or higher by Standard & Poor's Ratings Services or A-2 or higher by
Moody's Investors Service, Inc.);
(c) commercial paper with maturities of not more than 180 days
having the highest rating then given by Moody's Investors Services, Inc. or
Standard & Poor's Ratings Services;
(d) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in subparagraph (a) above
entered into with any Lender or any of the banks referred to in subparagraph (b)
above;
(e) shares in money market mutual funds substantially all the
assets of which are comprised of securities and other obligations of the types
described in subparagraph (a)through (d) above;
(f) (i) depository accounts at any Lender; and (ii) depository
accounts maintained at other banks;
(g) stock or obligations issued to the Company or any
Subsidiary thereof in settlement of claims against others by reason of an event
of bankruptcy or a composition or the readjustment of debt or a reorganization
of any debtor of the Company or such Subsidiary;
(h) currently existing Investments set forth on SCHEDULE A;
and
(i) Investments by the Company (x) in any of its Subsidiaries
for the purpose of financing the conduct of the business of such Subsidiary, or
(y) in a newly formed or acquired Subsidiary in connection with a Permitted
Acquisition.
Section 8.18 INDEBTEDNESS. Neither the Company nor any of the
Guarantors shall create, incur, assume or suffer to exist any Indebtedness,
except:
(a) the "Obligations" to the "Lenders" under the Revolving
Credit Agreement (as those terms are defined therein);
(b) existing Indebtedness, including Subordinated Debt, if
any, listed on SCHEDULE A hereto;
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(c) Capital Lease Obligations in an aggregate amount not to
exceed $2,000,000 at any one time outstanding; PROVIDED that after giving effect
to the incurrence of any such Capital Lease Obligations and to the receipt and
application of the proceeds thereof, no Default or Event of Default shall have
occurred and be continuing;
(d) Subordinated Debt incurred by the Company and the
Guarantors after the date hereof; PROVIDED that, giving effect to the incurrence
of such Subordinated Debt and to the receipt and application of the proceeds
thereof, no Default shall have oc curred and be continuing;
(e) mortgage Indebtedness on the Excluded Property not to
exceed $500,000 in principal amount at any one time outstanding in addition to
the currently existing mortgage Indebtedness on such Excluded Property as
described on SCHEDULE A hereto;
(f) reimbursement obligations owing to the Company's and the
Guarantors' workers' compensation insurance carriers;
(g) purchase money Indebtedness for the purchase price of
equipment and capital assets incurred in the ordinary course of business,
PROVIDED that such Indebtedness does not exceed $500,000 in principal amount in
the aggregate at any time outstanding;
(h) Indebtedness assumed in connection with any Permitted
Acquisition to the extent the same does not exceed the limits set forth in
clause (a)iv) of the definition of Permitted Indebtedness, provided that such
Indebtedness was not incurred in contemplation of such Permitted Acquisition and
further provided that the aggregate amount of all such assumed Indebtedness does
not exceed $10,000,000; and
(i) unsecured Indebtedness of the Company and the Guarantors,
or any of them, issued to sellers in connection with Permitted Acquisitions,
provided that at the time of the incurrence of such Indebtedness and giving
effect thereto and to such acquisition, no Default shall have occurred and be
continuing (the "Seller Debt").
8.19 GUARANTEES. Neither the Company nor any of the Guarantors
shall create, incur or suffer to exist any obligations in respect of Guarantees
except for:
(a) existing Guarantees, if any, listed on SCHEDULE A hereto;
(b) Guarantees entered into after the date hereof in
connection with Capital Lease Obligations and Indebtedness permitted under
Section 8.18.
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Section 8.20 DEBT COVERAGE. The Company will not permit the
ratio of Total Funded Debt to Adjusted EBITDA to exceed 2.5 to 1.0 during any
four consecutive fiscal quarters, as determined at the end of each fiscal
quarter for the four quarters then ended.
Section 8.21 FIXED CHARGES COVERAGE. The Company will not
permit the ratio of Adjusted EBITDA plus rental payments in respect of the Lease
to Fixed Charges plus rental payments in respect of the Lease during any four
consecutive fiscal quarters, as determined at the end of each fiscal quarter for
the four quarters then ended, to be less than (i) 1.05 to 1.0 at the end of
each-fiscal quarter through December 31, 1997, and (ii) 1.25 to 1.0 at the end
of each fiscal quarter thereafter.
Section 8.22 CAPITAL RATIO. The Company will not permit the
ratio of Total Funded Debt to Capitalization to exceed 0.5 to 1.0 at any fiscal
quarter end.
Section 8.23 CURRENT RATIO. The Company will not permit the
ratio of Current Assets to Current Liabilities to be less than 1.35 to 1.0 at
any fiscal quarter end.
Section 8.24 MINIMUM TANGIBLE NET WORTH. The Company shall at
all times maintain consolidated Tangible Net Worth of not less than (i)
$26,851,622, plus (ii) seventy-five percent (75%) of all cumulative consolidated
Net Income of the Company following the Closing Date, PROVIDED, that for
purposes of this clause (ii) only positive consolidated Net Income shall be
included and any net losses shall be disregarded, plus (iii) seventy-five
percent (75%) of the net proceeds of any public offering by the Company of
shares of capital stock of the Company. The level of Tangible Net Worth required
under this Section 8.24 may be adjusted, for certain non-cash charges to the
extent incurred in connection with Permitted Acquisitions which are identified
to and approved by the Agent in writing.
Section 8.25 RELATED CONTRACTS. The Company, as agent for the
Lessor, will comply with, maintain execution counterparts of, and promptly upon
request by the Agent from time to time deliver copies of, or after the
occurrence of an Event of Default, originals of, all Related Contracts.
Section 8.26 TRANSACTIONS WITH AFFILIATES. Except as permitted
by Section 8.17 or as set forth on SCHEDULE A and except for transactions solely
between or among the Company and the Guarantors or between or among the
Guarantors, the Company will not, and will not permit any of the Subsidiaries
to, directly or indirectly, pay any funds to or for the account of, make any
Investment in, lease, sell, transfer or otherwise dispose of any assets,
tangible or intangible, or engage in any transaction in connection with any
joint enterprise or other joint arrangement with, any Affiliate of the Company,
unless such transaction is not prohibited by this Agreement, is for reasonable
business or tax purposes, is in the ordinary course of
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the Company's or such Subsidiary's business, and is upon fair and reasonable
terms no less favorable to the Company or such Subsidiary as those that could be
obtained in a comparable arm's length transaction with a Person not an
Affiliate.
Section 8.27 AGREEMENT TO PLEDGE, ETC. The Company
acknowledges that the Lessor shall grant to the Agent for the benefit of the
Lenders a first and prior Lien on and security interest in and to the Lease and
the other Transaction Documents and shall execute and deliver the Lessor
Mortgage encumbering the Facility, in each case securing the Notes and other
amounts owing to the Lenders by the Lessor under the Transaction Documents,
subject only to Permitted Liens.
Section 8.28 FURTHER ASSURANCES. The Company will cure
promptly any defects in the due execution and delivery by it of the Transaction
Documents, including this Agreement. The Company at its expense will promptly
execute and deliver to the Agent upon request all such other and further
documents, agreements and instruments in compliance with or accomplishment of
the covenants and agreements of the Company in the Transaction Documents,
including this Agreement, or to further evidence and more fully describe the
collateral relating to the Facility intended as security for the Notes and
Lessor Investment, or to correct any item that the Company and the Agent agree
constitutes an omission or error in the Transaction Documents, or more fully to
state the existing security obligations set out herein or in any of the
Transaction Documents, or to perfect, protect or preserve any Liens created
pursuant to any of the Transaction Documents, or to make any recordings, to file
any notices, or obtain any consents, required by the terms of the Transaction
Documents, all as may be necessary or appropriate in connection therewith.
Section 8.29 COMPLETION; ETC. The Lessor and the Company, as
agent for the Lessor, will use the proceeds of the Loans and the Lessor
Investment Payments for the purposes specified in Section 7.01(o) and will
proceed to achieve Completion on or prior to the Completion Date. The Company,
as agent for the Lessor, will perform and observe in all material respects its
obligations under the agreements and instruments comprising the Facility Plan
and all Applicable Permits the failure to perform or observe which will have a
Material Adverse Effect. The Company, as Acquisition/Construction Agent for the
Lessor, will preserve, protect and maintain in effect all Applicable Permits
unless the failure to maintain such Applicable Permits could not be reasonably
be expected to have a Material Adverse Effect.
Section 8.30 MAINTENANCE; ETC. The Company shall, as
Acquisition/Construction Agent for the Lessor, preserve, protect and maintain in
accordance with prudent industry practices their rights in and to the Applicable
Permits and all patents, patent applications, trademarks (whether registered or
not), trademark applications, trade names, proprietary computer software, or
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copyrights used in the ordinary course of business of the Facility that are
necessary for and material to the operation of the Facility the failure to have
or maintain which would have a Material Adverse Effect; and the Company shall
defend and hold harmless the Lessor, the Agent and each Lender from and against
any cost, liability or expense arising from any claim of infringement, misuse or
misappropriation of any of the foregoing.
Section 8.31 ENCROACHMENTS. The Facility, when completed,
shall be situated wholly within the boundary lines of the Site and shall not
encroach upon any contiguous or adjoining Property (other than those portions of
the Facility for which the Lessor has the right to locate and operate such
portions pursuant to use or operating agreements); and the Facility shall not
violate any other easements, rights-of-way, licenses or other agreements
affecting the Site.
Section 8.32 FACILITY PLAN. The Company shall not amend or
revise the Facility Plan in any manner which would materially and adversely
affect the operation, design or capacity of the Facility without the prior
written consent of the Majority Lenders, which will not be unreasonably
withheld. The Company shall not under any circumstance undertake to operate or
use or otherwise initiate the operations at or use of the Facility except in
accordance in all material respects with the Facility Plan and except for the
Permitted Use. The Company shall be fully and solely responsible for funding all
costs in connection with the acquisition, development, renovation, construction
and installation of the Facility in excess of the limits contained in Section
2.01, it being understood and agreed that neither the Lessor, the Agent nor any
Lender shall under any circumstances whatsoever be obligated to fund any amount
for any of the Facility Cost in excess of the limits contained in Section 2.01.
Section 8.33 NEW SUBSIDIARIES TO BECOME GUARANTORS. The
Company does not have any Subsidiaries except those on SCHEDULE A. Immediately
following the creation of any Subsidiary following the Closing Dates, a or the
acquisition by the Company of any Person which becomes a Subsidiary, the Company
(i) shall cause such Subsidiary to become a "Guarantor" and to execute and
deliver such instruments and other documents, in form and substance satisfactory
to the Agent, as the Agent shall reasonably require in order to effectuate such
joinder, (ii) shall forthwith deliver to the Agent pursuant to the Security
Instruments the certificates evidencing all of the issued and outstanding shares
of stock of such Subsidiary, accompanied by undated stock powers executed in
blank and take such other action as the Agent shall request to perfect the
security interest created therein pursuant to the Security Instruments, and
(iii) notify the Agent in writing of the creation or acquisition of such
Subsidiary. The Company shall, and shall cause the appropriate Subsidiaries to,
promptly (x) execute and deliver to the Agent such number of copies as the Agent
may specify of documents creating such Liens, (y) do all other things which may
be necessary or which the Agent may reasonably request in order
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to confer upon and confirm to the Agent the benefits of such security, and (z)
deliver such legal opinions, certificates, evidences of corporate action or
other documents as the Agent may reasonably request, all in form and substance
reasonably satisfactory to the Agent, relating to the satisfaction of the
Company's obligations under this Section.
Section 8.34 COVENANTS OF LESSOR. The Lessor covenants and
agrees that so long as it remains Lessor thereunder, the Lessor shall preserve
and maintain its corporate existence and material rights, privileges and
franchises, and perform every act and discharge all of its obligations hereunder
and under the Transaction Documents; PROVIDED the sole remedy of the parties to
this Agreement for breach by the Lessor of its obligations shall be to cause a
successor Person satisfactory to the Majority Lenders to assume the rights,
duties and obligations of the Lessor hereunder and under the other Transaction
Documents.
ARTICLE IX
Events of Default
Section 9.01 EVENTS OF DEFAULT. The occurrence and
continuation of any one or more of the following events shall constitute an
"EVENT OF DEFAULT".
(a) The Company, as Acquisition/Construction Agent for the
Lessor, shall default in the payment of any principal of any Loan or the
principal amount of any Lessor Investment Payment when due; or default in the
payment of any interest on any Loan or Yield (including without limitation any
Accrued Construction Term Yield) on any Lessor Investment Payment and the
continuance of such default for five (5) Business Days thereafter; or default in
the payment of any fees or other amounts payable by it hereunder or under the
Transaction Documents, to the Agent and the Lenders or the Lessor when due and
the continuance of such default for five (5) Business Days thereafter; or
default in the payment of any other amounts payable hereunder or under any other
Transaction Documents to agents, attorneys and consultants of the Agent or any
Lender or the Lessor when due and the continuance of such nonpayment for thirty
(30) days thereafter; or
(b) Any representation, warranty, certification or statement
made by the Company or the Guarantors in Article VII of this Agreement or in any
other Transaction Document or in any certificate, financial statement or other
document delivered pursuant to this Agreement or any other Transaction Document
shall prove to have been incorrect or misleading in any material respect when
made or reaffirmed (or deemed made or reaffirmed); or
(c) The Company shall fail to observe or perform any covenant
or agreement contained in Sections 8.02, 8.03, 8.05, 8.06, or 8.13 through 8.24;
or
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(d) The Company shall fail to observe or perform any covenant
or agreement contained or incorporated by reference in this Agreement (other
than those covered by paragraphs (a) and (c) above), or the Guarantors shall
fail to observe or perform any covenant or agreement contained or incorporated
by reference in the Guaranty (Lessee), and in either case such failure shall not
have been cured within (1) 20 days, with respect to [insert relevant references
to the Guaranty (Lessee), and (2) 30 days, with respect to all other covenants
or agreements, after the earlier to occur of (i) written notice thereof has been
given to the Lessor, the Company and the Guarantors by the Agent at the request
of the Majority Lenders or (ii) an executive, senior financial or accounting
officer of the Company or the Guarantors otherwise becomes aware of any such
failure; or
(e) An "Event of Default" under or as defined in (i) the Lease
or (ii) any other Transaction Document or (iii) the Revolving Credit Agreement
shall occur; or
(f) The Company, the Guarantors or any Material Subsidiary
shall fail to make any payment in respect of Indebtedness outstanding in an
aggregate principal amount equal to or greater than $500,000 (excluding
Indebtedness incurred pursuant hereto) after the expiry of any applicable grace
period; or
(g) Any other event or condition shall occur which (i) results
in the acceleration of the maturity of Indebtedness (other than Indebtedness
which would not constitute a "liability" in accordance with GAAP) outstanding of
the Company or any Guarantor in an aggregate principal amount equal to or
greater than $500,000, including, without limitation, any required mandatory
prepayment or "put" of such Indebtedness to the Guarantor, the Company or any
Material Subsidiary) or (ii) enables (or, with the giving of notice or lapse of
time or both, would enable) the holders of such Indebtedness or any Person
acting on such holders' behalf to accelerate the maturity thereof (including,
without limitation, any required mandatory prepayment or "put" of such
Indebtedness to the Guarantor, the Company or any Material Subsidiary); or
(h) The Company or any Guarantor shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize any of the
foregoing; or
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(i) An involuntary case or other proceeding shall be commenced
against the Company or any Guarantor seeking liquidation, reorganization or
other relief with respect to it or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against the Company or any Guarantor under the federal
bankruptcy laws as now or hereafter in effect; or
(j) The Company, any Guarantor, or any member of the
Controlled Group shall fail to pay when due any amount aggregating in excess of
$500,000 which it shall have become liable to pay to the PBGC or to a Plan under
Title IV of ERISA; or notice of intent to terminate a Plan or Plans shall be
filed under Title IV of ERISA by the Company, any member of the Controlled
Group, any plan administrator or any combination of the foregoing; or the PBGC
shall institute proceedings under Title IV of ERISA to terminate or to cause a
trustee to be appointed to administer any such Plan or Plans or a proceeding
shall be instituted by a fiduciary of any such Plan or Plans to enforce Section
515 or 4219(c)(5) of ERISA and such proceeding shall not have been dismissed
within 30 days thereafter; or a condition shall exist by reason of which the
PBGC would be entitled to obtain a decree adjudicating that any such Plan or
Plans must be terminated; or
(k) One or more judgments or orders for the payment of money
in an aggregate amount in excess of $500,000 (net of amounts fully covered by
insurance) shall be rendered against the Company or any Guarantor and such
judgment or order shall continue unsatisfied and unstayed for a period of 60
days; or
(l) A federal tax lien shall be filed against the Company or
any Guarantor under Section 6323 of the Code or a lien of the PBGC shall be
filed against the Company or any Guarantor under Section 4068 of ERISA and if in
either case the amount involved is in an aggregate amount in excess of $500,000
and such lien shall remain undischarged for a period of 25 days after the date
of filing;
(m) Any of the Transaction Documents shall cease, for any
reason, to be in full force and effect or the Guarantors or the Company shall so
assert; or
(n) The Company shall abandon the Facility or the renovation
or construction and development thereof, or Completion shall not have occurred
on or before the Completion Date;
UNLESS in any event, the Company (or any Affiliate thereof) pays the Termination
Value or acquires the Facility by payment in full of the Purchase Price within
five (5) Business Days after the occurrence of such event or existence of such
condition.
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Section 9.02 REMEDIES. Upon the occurrence and continuation of
any Event of Default:
(a) in the case of an Event of Default (other than one
referred to in Sections 9.01(h) or (i)), the Agent may and, upon request of the
Majority Lenders, shall, by notice to the Lessor and the Company and the
Guarantors, cancel the Commitments and/or declare the principal amount then
outstanding of and the accrued interest on the Loans and the principal amount of
and accrued Yield on the Lessor Investment and all other amounts payable by the
Lessor or by the Company, as Acquisition/Construction Agent for the Lessor,
hereunder and under the Notes to be forthwith due and payable, whereupon such
amounts shall be immediately due and payable without presentment, demand,
protest, notice of intent to accelerate, notice of acceleration or other
formalities of any kind, all of which are hereby expressly waived by the Company
and the Lessor, and apply the Cash Collateral in accordance with the provisions
of Section 2.02(c); and
(b) in the case of the occurrence of an Event of Default
referred to in Sections 9.01(h) or (i), the Commitments shall be automatically
cancelled and the principal amount then outstanding of and the accrued interest
on the Loans and the principal amount of and accrued Yield (including without
limitation all Accrued Construction Term Yield) on the Lessor Investment and all
other amounts payable by the Lessor, the Lessee or the Company as
Acquisition/Construction Agent for the Lessor hereunder, under the Notes and
under the other Transaction Documents shall become automatically immediately due
and payable without presentment, demand, protest, notice of intent to
accelerate, notice of acceleration or other formalities of any kind, all of
which are hereby expressly waived by the Company and the Lessor.
(c) Notwithstanding Sections 9.02(a) and (b), the Company or
the Guarantors may cure any Default or Event of Default under Section 9.01 by
paying the Termination Value or purchasing the Facility as provided in Section
15(c) of the Lease for the Purchase Price.
(d) The Lessor may not initiate or pursue remedies unless and
until the Agent and the Lenders have initiated remedies against the Facility,
the Company or the Guarantors. In the event the Agent and the Lenders have
initiated remedies, the Lessor may join in enforcement of remedies against the
Facility, the Company or the Guarantors.
(e) If the Majority Lenders shall have instructed the Agent to
cause the Lessor to sell or otherwise dispose of the Facility or to foreclose on
the Facility and other collateral in accordance with the Security Instruments
and the Lease, then (i) the net cash sales or foreclosure proceeds to be
received must at least equal an amount equal to the Funded Amount, plus all
other amounts then owing to the Lenders and the Lessor hereunder and under the
other Transaction Documents; and (ii) the Majority
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Lenders may not, without the consent of the Lessor, instruct the Lessor to sell
the Facility or any portion thereof for an amount less than the Unguaranteed
Amount, or instruct the Agent to foreclose on the Facility in accordance with
the Security Instruments and the Lease unless the Lenders intend to make a cash
bid to purchase the Facility for an amount not less than the Unguaranteed
Amount. In the event that all of the Lenders have been repaid in full in
accordance with this Agreement with respect to amounts owing to them as Lenders,
or if the Company or any of its Affiliates shall have acquired all of the Notes,
the Agent shall act or refrain from acting, and shall be fully protected in
acting or refraining from acting, in accordance with instructions signed solely
by the Lessor. Instructions of the Majority Lenders, and any action taken or
failure to act pursuant thereto, shall be binding on all of the Lenders and the
Lessor.
(f) The Agent, the Lenders and the Lessor agree not to
exercise their remedies against the Facility under the Security Instruments
unless an Event of Default has occurred and is continuing hereunder and the
Lease has terminated and the Company (or any Affiliate thereof) shall not have
purchased the Facility on or before the Cancellation Date.
ARTICLE X
The Agent
Section 10.01 APPOINTMENT, POWERS AND IMMUNITIES. Each Lender
and the Lessor hereby appoints and authorizes the Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement as are
delegated to the Agent by the terms hereof, together with such powers as are
reasonably incidental thereto. As to any matters not expressly provided for by
this Agreement (including, without limitation, enforcement of this Agreement or
collection of the Notes and the Lessor Investment), the Agent shall not be
required to exercise any discretion or take any action, but shall be required to
act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Majority Lenders, and such
instructions shall be binding upon all Lenders and all holders of Notes and the
Lessor; PROVIDED, HOWEVER, that the Agent shall not be required to take any
action which exposes the Agent to personal liability or which is contrary to
this Agreement or applicable law. The Agent agrees to give to each Lender and
the Lessor prompt notice of each notice given to it by the Lessor, the Company
or the pursuant to the terms of this Agreement or any of the Transaction
Documents.
Section 10.02 RELIANCE BY AGENT. None of the Agent or any of
its respective directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken by it or them in good faith under or in
connection with this Agreement, except for its or their own gross negligence or
willful misconduct. Without limitation of the generality of the
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foregoing, the Agent: (a) may treat the payee of any Note as the holder thereof
until the Agent receives and accepts an Assignment and Acceptance entered into
by the Lender which is the payee of such Note, as assignor, and an Eligible
Assignee, as assignee, as provided in Section 11.06; (b) may consult with legal
counsel (including counsel for the Company or the Guarantors), independent
public accountants and other experts selected by it in good faith and shall not
be liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (c) makes no
warranty or representation to any Lender or the Lessor and shall not be
responsible to any Lender or the Lessor for any statements, warranties or
representations (whether written or oral) made in or in connection with this
Agreement or any of the other Transaction Documents; (d) shall not have any duty
to ascertain or to inquire as to the performance or observance of any of the
terms, covenants or conditions of this Agreement or any of the other Transaction
Documents on the part of the Company or the Guarantors or to inspect the
Facility or the property (including the books and records) of the Company or the
Guarantors; (e) shall not be responsible to any Lender or the Lessor for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement, any other Transaction Documents or any other instrument or
document furnished pursuant hereto; (f) shall incur no liability under or in
respect of this Agreement or the Transaction Documents by acting upon any
notice, consent, certificate or other instrument or writing (which may be by
telegram, telecopier, cable or telex) believed by it in good faith to be genuine
and signed or sent by the proper party or parties; and (g) shall act or refrain
from acting, and shall be fully protected in acting or refraining from acting,
in causing the Lessor to sell or otherwise dispose of the Facility, or in
foreclosing on the Facility in accordance with the Security Instruments, upon
receiving instructions signed by the Majority Lenders.
Section 10.03 DEFAULTS. The Agent shall not be deemed to have
knowledge of the occurrence of a Default (other than the non-payment of
principal of or interest on Loans, the face amount of or Yield on the Lessor
Investment or of fees) unless the Agent has received notice from a Lender, the
Company or the Lessor specifying such Default and stating that such notice is a
"Notice of Default." In the event that the Agent receives such a notice of the
occurrence of a Default, the Agent shall give prompt notice thereof to the
Lenders and the Lessor (and shall give each Lender and the Lessor prompt notice
of each such non-payment). The Agent shall (subject to Section 10.07) take such
action with respect to such Default as shall be directed by the Majority Lenders
or the Lessor, as appropriate, as provided in Section 10.02, provided that,
unless and until the Agent shall have received such directions, the Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default as it shall deem advisable in the best
interest of the Lenders and the Lessor.
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Section 10.04 RIGHTS AS A LENDER. With respect to its
Commitment, the Loans made by it and the Notes issued to it, Fleet Real Estate
Capital, Inc. shall have the same rights and powers under this Agreement as any
other Lender and may exercise the same as though Fleet Bank were not the Agent.
Fleet Bank and its affiliates may accept deposits from, lend money to, act as
trustee under indentures of, and generally engage in any kind of business with,
the Company, any of the Guarantors and any Person who may do business with or
own securities of the Company or any of the Guarantors, all as if Fleet Bank
were not the Agent and without any duty to account therefor to the Lenders.
Section 10.05 INDEMNIFICATION. The Lenders agree to indemnify
the Agent (to the extent not reimbursed by the Lessor or the Company), ratably
according to the respective principal amounts of the Notes then held by each of
them (or if no Notes are at the time outstanding or if any Notes are held by
Persons which are not Lenders, ratably according to the respective amounts of
the Aggregate Loan Commitments), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, orders, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by, or asserted against the Agent in any way relating to or
arising out of this Agreement or any of the Transaction Documents or any action
taken or omitted by the Agent under this Agreement or any of the Transaction
Documents, PROVIDED that no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
orders, suits, costs, expenses or disbursements resulting from the Agent's gross
negligence or willful misconduct. Without limitation of the foregoing, each
Lender agrees to reimburse the Agent promptly upon demand for its ratable share
of any out-of-pocket expenses (including reasonable counsel fees) incurred by
the Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings, in bankruptcy or insolvency proceedings, or
otherwise) of, or legal advice in respect of rights or responsibilities under,
this Agreement or the other Transaction Documents, to the extent that the Agent
is not reimbursed for such expenses by the Company or the Guarantors.
Section 10.06 NON-RELIANCE ON AGENT AND OTHER LENDERS. Each
Lender acknowledges that it has, independently and without reliance upon the
Agent or any other Lender and based on the financial statements referred to in
Section 7.01 and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement. Except for
notices, reports and other documents and information expressly required to be
furnished to the Lenders by the Agent hereunder, the Agent
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shall not have any duty or responsibility to provide any Lender with any credit
or other information concerning the affairs, financial condition or business of
the Company, the Lessor or the affiliates of either of them, which may come into
the possession of the Agent or any of its affiliates.
Section 10.07 FAILURE TO ACT. The Agent shall in all cases be
fully justified in failing or refusing to act hereunder or under the Transaction
Documents unless it shall be indemnified to its satisfaction by the Lenders
against any and all liability and expenses which may be incurred by it by reason
of taking or continuing to take any such action.
Section 10.08 RESIGNATION OR REMOVAL OF AGENT. The Agent may
resign at any time by giving written notice thereof to the Lenders, the Lessor
and the Company and may be removed at any time with or without cause by the
Majority Lenders. Upon any such resignation or removal, the Majority Lenders
shall have the right to appoint a successor Agent. If no successor Agent shall
have been so appointed by the Majority Lenders and shall have accepted such
appointment within 30 days after the retiring Agent's giving of notice of
resignation or the Majority Lenders' removal of the retiring Agent, then such
retiring Agent may, on behalf of the Lenders, appoint a successor Agent, which
shall be a Lender and a commercial bank organized, or authorized to conduct a
banking business, under the laws of the United States of America or of any State
thereof and having a combined capital and surplus of at least $500,000,000. Upon
the acceptance of any appointment as Agent hereunder by a successor Agent, each
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations under this Agreement
and the Transaction Documents. After any retiring Agent's resignation or removal
hereunder as Agent, the provisions of this Article XI shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Agent under
this Agreement.
ARTICLE XI
Miscellaneous
Section 11.01 AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement or the Notes, and no consent to any departure by the
Company or the Lessor therefrom, shall be effective against the Company, the
Lessor, the Agent or the Lenders unless it shall be in writing and signed by the
Company and the Majority Lenders, and no amendment or waiver of any provision of
any Transaction Documents, and no consent to any departure by the Company or the
Lessor therefrom, shall be effective against the Company, the Lessor, the Agent
or the Lenders unless signed by the Persons executing such Transaction Document,
the Company and the Agent with the consent of the Majority Lenders; and in any
event, any such waiver or consent
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shall be effective only in the specific instance and for the specific purpose
for which given; PROVIDED, HOWEVER, that no such amendment, waiver or consent
shall, unless in writing and signed by the Company, the Lessor and all the
Lenders, be effective to: (a) waive any of the conditions specified in Article
VI, (b) increase the Aggregate Loan Commitments or Lessor Investment Commitment
or subject the Lessor or the Lenders to any additional obligations, (c) reduce
the principal of, or interest on, the Notes, or the face amount or yield on the
Lessor Investment hereunder, (d) postpone any date fixed for any payment of
principal of, or interest on, the Notes, or the face amount or Yield on the
Lessor Investment hereunder, (e) change the percentage of the Aggregate Loan
Commitments or Lessor Investment Commitment or of the aggregate unpaid principal
amount of the Notes or Lessor Investment, or the number of Lenders which shall
be required for the Agent, the Lenders, the Lessor or any of them to take any
action under this Agreement, (f) amend this Section 11.01, (g) except as
otherwise permitted in this Agreement or the other Transaction Documents, permit
the creation of any Lien (other than Permitted Liens) on the Collateral equal to
or prior to the interests of the Lenders, sell or otherwise dispose of any
portion of the Collateral or release any Lien created under the Transaction
Documents, (h) waive the terms of any payment obligation, amend or modify the
order of application of payments and proceeds, (i) amend, modify or waive any
provision of any of the Operative Guaranties or (j) change the requirements set
forth in SCHEDULE 1.02(B) necessary to achieve Completion; PROVIDED, FURTHER,
that no amendment, waiver or consent shall, unless in writing and signed by the
Agent in addition to the Lessor, the Lenders and other Persons required
hereinabove to take such action, affect the rights or duties of the Agent under
this Agreement or any Note.
Section 11.02 NOTICES. Except as otherwise provided in Article
II or Article V, all notices and other communications provided for hereunder
shall be in writing (including by telecopier and other readable communication)
and mailed by certified mail, return receipt requested, telecopied or otherwise
transmitted or delivered, if to the Company, at 2850 Douglas Road, Coral Gables,
Florida 33135, Attention: Stephen Waechter, Telecopier: 305-460-2396; if to any
Lender, at its address set forth under its name on its signature page hereto; if
to the Agent at 75 State Street, Boston, Massachusetts 02109, Attention: Ginger
Stolzenthaler, Telecopier: 617-346-1634; if to the Lessor at One Federal Street,
Boston, Massachusetts 02211, Attention: Jay Hart, Telecopier: 617-346-0513; or,
as to each party at such other address as shall be designated by such party in a
written notice to the other parties. All such notices and communications shall,
if so mailed, telecopied or otherwise transmitted, be effective when received,
if mailed, or when the appropriate answerback or other evidence of receipt is
given, if telecopied or otherwise transmitted, respectively. A notice received
by the Agent or a Lender or the Lessor by telephone pursuant to Article II or
Article V shall be effective if the Agent, Lender or Lessor believes in good
faith that it was given by an authorized
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representative of the Company and acts pursuant thereto, notwithstanding the
absence of written confirmation or any contradictory provision thereof.
Section 11.03 PAYMENT OF EXPENSES, INDEMNITIES, ETC.
(a) The Company as Acquisition/Construction Agent for the
Lessor agrees to pay on demand (i) all reasonable fees and out-of-pocket
expenses of counsel for the Agent (but not the separate counsel for the Lenders)
in connection with the preparation, execution and delivery of this Agreement,
the Notes, the other Transaction Documents and the other documents to be
delivered hereunder and the fulfillment or attempted fulfillment of conditions
precedent hereunder, and any amendments to any of the Transaction Documents,
(ii) all reasonable costs and expenses incurred by the Agent and its Affiliates
in initially syndicating all or any portion of the Commitments hereunder,
including, without limitation, the related reasonable fees and out-of-pocket
expenses of counsel for the Agent or its Affiliates, travel expenses,
duplication and printing costs and courier and postage fees, and excluding any
syndication fees paid to other parties joining the syndicate and (iii) all
out-of-pocket costs and expenses, if any, incurred by the Agent, the Lenders and
the Lessor in connection with the enforcement (whether through negotiations,
legal proceedings in bankruptcy or insolvency proceedings, or otherwise) of this
Agreement, the Notes, the other Transaction Documents and the other documents to
be delivered hereunder and thereunder, including the reasonable fees and
out-of-pocket expenses of separate counsel for each of them. In furtherance of
and not in limitation of the foregoing, the Company shall pay all fees, costs
and expenses incurred in obtaining the Facility Plan, the Approved Appraisal,
the Environmental Assessment, the Title Policy, the Surveys, the Related
Contracts and the Lessor's cost of obtaining residual value insurance. The
Company shall indemnify the Lessor, the Agent and each Lender against any
transfer taxes, documentary taxes, assessments or charges made by any
Governmental Authority by reason of the execution and delivery of any of the
Transaction Documents, and all other Impositions.
(b) The Company agrees, in addition to any other indemnity
obligations set forth in any Transaction Document, to indemnify and save
harmless, the Lessor, the Agent, each Lender and any of their successors and
assigns, and their respective of ficers, directors, incorporators, shareholders,
employees, agents, partners, attorneys, affiliates and servants (individually an
"INDEMNIFIED PARTY" and collectively the "INDEMNIFIED PARTIES") from and against
all liabilities, Liens, Taxes, Impositions, losses, obligations, claims, damages
(including, without limitation, penalties, fines, court costs and administrative
service fees), penalties, demands, causes of action, suits, proceedings
(including any investigations, litigation or inquiries), judgments, orders, sums
paid in settlement of claims, and costs and expenses of any kind or nature
whatsoever, including, without limitation, reasonable
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attorneys' fees and expenses and all other expenses incurred in connection with
investigating, defending or preparing to defend any cause of action, suit or
proceeding (including any investigations, litigation or inquiries) or claim
which may be incurred by or asserted against or involve any of them (whether or
not any of them is named as a party thereto) as a result of, arising directly or
indirectly out of or in any way related to (i) any actual or proposed use by the
Lessor or the Company of the proceeds of any of the Loans or Lessor Investment,
(ii) any other aspect of this Agreement, the Notes and the other Transaction
Documents, (iii) the operations of the business of the Company or the
Guarantors, (iv) the failure of the Company or the Guarantors to comply with any
Governmental Requirement (including, without limitation, design, construction,
manufacture, engineering, assembly, installation, use, operation or ownership of
the Facility or any portion thereof), (v) the breach of any representation or
warranty set forth herein regarding Environmental Requirements, (vi) the failure
of the Company as Acquisition/Construction Agent for the Lessor to pay any
amount required to be paid hereunder, including, without limitation, principal
and interest on the Notes and the face amount and Yield on the Lessor Investment
(whether or not the Lease has terminated), (vii) the failure of the Company to
perform any obligation herein required to be performed pursuant to Environmental
Requirements, or any act or omission which occurred or will occur at any prior
or subsequent time, or any condition or state of facts in existence at any prior
or subsequent time relating in any way to the Facility which gives rise to any
liability or obligation under any Environmental Requirement or gives rise to any
Environmental Damages, (viii) the Lessor's ownership and leasing of the Facility
pursuant to the Lease, (ix) the sale of any portion of the Facility either to
the Company or any other Person pursuant to the provisions of the Lease, (x) all
acts or omissions of the Company or any Sublessee, (xi) any Imposition, Lien,
judgment, order, tax, or other payment owing in respect of the Facility or which
the Company is obligated to discharge or pay to any Person, (xii) any action or
omission of the Company pursuant to, or breach of or failure to perform under,
the Agency Agreement, (xiii) any injury to, or death of, any Person, or damage
to or loss of Property to the extent not reimbursed by insurance prior to the
Indemnified Party having to make any payment in respect thereof, or any other
thing occurring on or resulting from activities on the Facility or any portion
thereof, (xiv) the renovation, construction, leasing, subleasing, operation,
occupancy, possession, use or non-use by the Company (whether in its individual
capacity or as Acquisition/Construction Agent for the Lessor) of the Facility or
any portion thereof, or the condition of the Facility or any portion thereof,
(xv) any Default or Event of Default under the Lease or this Agreement, (xvi)
any act or omission of the Company or its agents, contractors, licensees,
Sublessees, invitees, representatives or any other Person on or relating to, or
in connection with, the ownership, renovation, construction, leasing,
subleasing, operation, management, maintenance, occupancy, possession, use,
non-use or condition of the Facility
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or any portion thereof, (xvii) performance of any labor or services or
furnishing of any materials or other Property in respect of the Facility or any
portion thereof, (xviii) any permitted contest referred to in Section 13 of the
Lease, (xix) any claims for patent, trademark, trade name or copyright
infringement or (xx) any violation by the Company or the Guarantors of any
Transaction Document or any Related Contracts or any other contract or agreement
to which the Company or the Guarantors is a party, or of any Insurance
Requirement, in each case affecting any Indemnified Party, the Facility or any
portion thereof or the ownership, operation, occupancy, possession, use, non-use
or condition thereof, in each case regardless of the acts, omissions or
negligence of any Indemnified Party, it being the intent of the Company, to the
fullest extent permitted by applicable law, to indemnify the Indemnified Parties
for their own negligent acts or omissions (other than gross negligence or wilful
misconduct) in connection with any of the foregoing (collectively, the
"INDEMNIFIED RISKS"); PROVIDED, HOWEVER, that no Indemnified Party shall be
entitled to indemnity (or any other payment or reimbursement) for any
Indemnified Risks to the extent such Indemnified Risks result from or arise out
of one or more of the following: (1) any representation or warranty by such
Indemnified Party in the Transaction Documents being incorrect; (2) the willful
misconduct or gross negligence of, or the violation of any law, rule or
regulation binding upon such Indemnified Party; (3) the failure on the part of
the Lessor or the Agent to distribute in accordance with this Agreement any
amounts received and distributable by it hereunder; (4) a claim arising from the
offer, sale or delivery of the Lessor Investment or a Note or an interest in the
Lessor Investment or a Note or this Agreement by such Indemnified Party (other
than insert name of Lessor] or the Lessor, subject nevertheless to clause (2)
above) for a violation of any Governmental Requirement unless such violation was
caused by some performance or nonperformance of the Company or the Guarantors;
(5) claims of such Indemnified Party which is a Lender or the Agent arising
because of a claim against such Indemnified Party brought by another Lender or
the Agent; (6) any claim for economic losses based upon the rate of return of
the Loans; and (7) payment of the principal of the Tranche B Loans or the Lessor
Investment Payments in the circumstances described in Section 3.05(b), if the
Company shall have paid the Final Rent Payment or the Completion Costs Payment,
as applicable, and complied with its other obligations under the Transaction
Documents.
(c) If any cause of action, suit, proceeding or claim arising
from any of the foregoing is brought against any Indemnified Party, whether such
action, proceeding, suit or claim shall be actual or threatened, or in
preparation therefor, the Company will have the right, at its expense, to assume
the resistance and defense of such cause of action, suit, proceeding or claim or
cause the same to be resisted and defended; PROVIDED that such Indemnified Party
shall be entitled (but not obligated) to participate jointly in such defense, in
which case such Indemnified Party will be responsible for its own legal fees or
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other expenses, if any, related to such defense incurred subsequent to the joint
participation by such party in such defense. Notwithstanding the foregoing, if
any Indemnified Party shall have been advised by counsel chosen by it that there
may be one or more legal defenses available to such Indemnified Party that are
different from or additional to those available to the Company, the Indemnified
Party may assume the defense of such action and the Company agrees to reimburse
such Indemnified Party for the reasonable fees and expenses of any counsel
retained by the Indemnified Party. The Company may settle any action which it
defends hereunder on such terms as it may deem advisable in its sole discretion,
subject to its ability promptly to perform in full the terms of such settlement.
No Indemnified Party may seek indemnification or other reimbursement or payment,
including attorneys' fees or expenses, from the Company for any cause of action,
suit, proceeding or claim settled, compromised or in any way disposed of by the
Indemnified Party without the Company's prior written consent, which will not be
unreasonably withheld.
(d) The obligations of the Company under this Section 11.03
shall survive the expiration or any termination of this Agreement (whether by
operation of law or otherwise) and the payment of amounts owed by the Lessor and
the Company under this Agreement, the Notes, the Lessor Investment and the other
Transaction Documents, and shall also expressly survive any sale, transfer or
conveyance of the Facility made by the Lessor pursuant to the Lease.
(e) Upon demand for payment by any Indemnified Party of any
Indemnified Risks incurred by it for which indemnification is sought, the
Company shall pay when due and payable the full amount of such Indemnified Risks
to the appropriate party, unless and only so long as: (i) the Company shall have
assumed the defense of such action and is diligently prosecuting the same; (ii)
the Company is financially able to pay all its obligations outstanding and
asserted against the Company at that time, including the full amount of the
Indemnified Risks; and (iii) the Company has taken all action as may be
reasonably necessary to prevent (1) the collection of such Indemnified Risks
from the Indemnified Party; (2) the sale, forfeiture or loss of the Facility or
any portion thereof during such defense of such action; and (3) the imposition
of any civil or criminal liability for failure to pay such Indemnified Risks
when due and payable.
(f) The Company acknowledges and agrees that (i) its
obligations under this Section 11.03 are intended to include and extend to any
and all liabilities, Liens, Taxes, losses, obligations, claims, damages
(including, without limitation, penalties, fines, court costs and administrative
service fees), penalties, demands, causes of action, suits, proceedings
(including any investigations, litigation or inquiries), judgments, orders, sums
paid in settlement of claims, costs and expenses (including, without limitation,
response and remediation costs, stabilization costs, encapsulation costs, and
treatment, storage or disposal costs), imposed upon or incurred by or
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asserted at any time against any Indemnified Party (whether or not indemnified
against by any other party) as a result of, arising directly or indirectly out
of or in any way related to (A) the treatment, storage, disposal, generation,
use, transport, movement, presence, release, threatened release, spill,
installation, sale, emission, injection, leaching, dumping, escaping or seeping
of any Hazardous Materials at or from the Facility or any part thereof; (B) the
violation or alleged violation of any Environmental Laws relating to or in
connection with the Facility or any part thereof or any acts or omissions
thereon or relating thereto; (C) all other federal, state and local laws
designed to protect the environment or persons or property therein, whether now
existing or hereinafter enacted, promulgated or issued by any governmental
authority relating to or in connection with the Facility or any part thereof or
any acts or omissions thereon or relating thereto; (D) the Company's failure to
comply with its obligations under Section 7 of the Lease; and (E) any
abandonment of the Facility by the Company; PROVIDED, HOWEVER that no
Indemnified Party shall be entitled to indemnity or any other payment or
reimbursement for any of the types of claims enumerated in this Section 11.03(f)
to the extent such claims result from or arise out of the willful misconduct or
gross negligence of such Indemnified Party; and (ii) the indemnification
provided for under this Section 11.03(f) shall be governed by the procedures set
forth in Sections 11.03(c)-(e) above.
(g) Without limiting the generality of the foregoing
provisions of this Section 11.03, the Company agrees to pay or reimburse,
promptly upon demand, and protect, indemnify and save harmless, the Lessor, as
Lessor under the Lease, following the occurrence of a Termination Event, from
any action by any Sublessee or other owner of an interest in the Facility (other
than a Co-Lessee) which causes the Lessor, as Lessor under the Lease, any delay
in exercising its remedies, or results in the reduction of the Lessor's
remedies, under the Lease. Upon demand of the Lessor, as Lessor under the Lease,
for indemnification pursuant to this Section 11.03(g), the Company agrees that
it will, within twenty (20) days of such demand from the Lessor, (a) purchase
the Notes from the Lenders for a purchase price equal to the principal balance,
accrued, unpaid interest, fees and expenses, and all other amounts then owing by
the Lessor to the Lenders as advised to the Company in writing by the Agent, and
(b) purchase the Lessor Investment from the Lessor for a purchase price equal to
the outstanding face amount, accrued, unpaid Yield, fees and expenses, and all
other amounts then owing to the Lessor as advised to the Company in writing by
the Agent.
(h) In case any action shall be brought against any
Indemnified Party in respect of which indemnity may be sought against the
Company, such Indemnified Party shall promptly notify the Company in writing,
but the failure to give such prompt notice shall not relieve the Company from
liability hereunder, except to the extent that such failure to notify causes an
increase in the amount otherwise assertable under this indemnity.
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Section 11.04 NO WAIVER; REMEDIES. No failure on the part of
any Lender, the Agent or the Lessor to exercise, and no delay in exercising, any
right hereunder or under any Note or any Transaction Document shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
or under any Note or Transaction Document preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
Section 11.05 RIGHT OF SET-OFF. Upon the declaration of the
Notes as due and payable pursuant to the provisions of Section 9.02, each Lender
is hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Lender to or for the credit or the account of the Company
against any and all of the obligations of the Company now or hereafter existing
under this Agreement or the Notes of the Company held by such Lender,
irrespective of whether or not such Lender shall have made any demand under this
Agreement or such Notes and although such obligations may be unmatured. Each
Lender agrees promptly to notify the Company after any such set-off and
application made by such Lender, PROVIDED that the failure to give such notice
shall not affect the validity of such set-off and application. The rights of
each Lender under this Section 11.05 are in addition to other rights and
remedies (including, without limitation, other rights of set-off) which such
Lender may have.
Section 11.06 ASSIGNMENTS AND PARTICIPATIONS.
(a) Neither the Lessor nor the Company may assign its rights
or obligations hereunder or under the Notes or the Lessor Investment or any
other Transaction Document without the prior consent of all of the Lenders and
the Agent.
(b) Each Lender may at any time assign to one or more banks or
other financial institutions all or a portion of its rights and obligations
under this Agreement (including, without limitation, all or a portion of its
Loan Commitment, the Loans owing to it and the Note held by it) and the assignee
thereof shall assume all such rights and obligations pursuant to an Assignment
and Acceptance executed by such assignee, such assigning Lender and the Agent);
PROVIDED, HOWEVER, that (i) each such assignment shall be of a constant, and not
a varying, percentage of all rights and obligations under this Agreement, (ii)
no interest may be sold by a Lender pursuant to this Section 11.06(b) unless the
assignee shall agree to assume ratably equivalent portions of the assigning
Lender's rights and obligations under this Agreement, (iii) the amount of the
Loan Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000 (or, if
less, the entire Commitment of
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the assigning Lender), (iv) each such assignment shall be to an Eligible
Assignee, (v) a Lender may not have more than two (2) assignees that are not
then Lenders at any one time and (vi) the parties to each such assignment shall
execute and deliver to the Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance, together with any Note subject to such
assignment and a processing and recordation fee of $3,500, and shall send to the
Company an executed counterpart of such Assignment and Acceptance. Upon such
execution, delivery, acceptance and recording, from and after the effective date
specified in each Assignment and Acceptance, (A) the assignee thereunder shall
be a party hereto and, to the extent that rights and obligations hereunder have
been assigned to it pursuant to such Assignment and Acceptance, have the rights
and obligations of a Lender hereunder and (B) the assigning Lender thereunder
shall, to the extent that rights and obligations hereunder have been assigned by
it pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto).
(c) By executing and delivering an Assignment and Acceptance,
each assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Assignment and Acceptance, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the Company
or any Guarantor or the performance or observance by the Company of any of its
obligations under this Agreement or by the Company or any Guarantor any other
Transaction Document; (iii) such assignee confirms that it has received a copy
of this Agreement, together with copies of the financial statements referred to
in Section 7.01 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the Agent, such assigning Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (v) such assignee confirms that it is an Eligible Assignee; (vi)
such assignee appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement as are delegated to
the Agent by the terms hereof, together with such powers as are reasonably
incidental thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all of the obligations
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which by the terms of this Agreement are required to be performed by it as a
Lender.
(d) The Agent shall maintain at its address referred to in
Section 11.02 a copy of each Assignment and Acceptance delivered to and accepted
by it and a register for the recordation of the names and addresses of the
Lenders and the Loan Commitment of, and principal amount of the Loans owing to,
each Lender from time to time (the "REGISTER"). The entries in the Register
shall be conclusive and binding for all purposes, absent manifest error, and the
Company, the Guarantors, the Lessor, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Company, the Guarantors, the Lessor or any Lender at any reasonable time and
from time to time upon reasonable prior notice. Upon the acceptance of any
Assignment and Acceptance for recordation in the Register, EXHIBIT E shall be
deemed to be amended to reflect the revised Loan Commitments of the Lenders
parties to such Assignment and Acceptance as well as administrative information
with respect to any new Lender as such information is recorded in the Register.
(e) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an assignee representing that it is an Eligible
Assignee, together with any Note subject to such assignment, the Agent shall, if
such Assignment and Acceptance has been completed and is in substantially the
form of EXHIBIT D, (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register and (iii) give prompt notice
thereof to the Lessor, the Company and the Guarantors; within five (5) Business
Days after its receipt of such notice and its receipt of an executed counterpart
of such Assignment and Acceptance, the Lessor, at the expense of the Company,
shall execute and deliver to the Agent in exchange for the surrendered Note, a
new Note to the order of such Eligible Assignee in an amount equal to the Loan
Commitment assumed by it pursuant to such Assignment and Acceptance and, if the
assigning Lender has retained a Loan Commitment hereunder, a new Note, to the
order of the assigning Lender in an amount equal to the Loan Commitment retained
by it hereunder. Such new Note shall be in an aggregate principal amount equal
to the aggregate principal amount of such surrendered Note, shall be dated the
date of such Assignment and Acceptance and shall otherwise be in substantially
the form of EXHIBITS B or C, as applicable.
(f) Each Lender may sell participations to one or more banks
or other entities in or to all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its Loan
Commitment and the Loans owing to it and the Notes held by it); PROVIDED,
HOWEVER, that (i) such Lender's obligations under this Agreement (including,
without limitation, its Loan Commitment to the Lessor hereunder) shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of
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such obligations, (iii) such Lender shall remain the holder of any such Notes
for all purposes of this Agreement, (iv) the Company, the Guarantors, the Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with its rights and obligations under this Agreement and
the other Transaction Documents, (v) such Lender shall continue to be able to
agree to any modification or amendment of this Agreement or any waiver hereunder
without the consent, approval or vote of any such participant or group of
participants, other than modifications, amendments and waivers which (A)
postpone any date fixed for any payment of, or reduce any payment of, principal
of or interest on such Lender's Notes or (B) increase the amount of such
Lender's Loan Commitment in a manner which would have the effect of increasing
the amount of a participant's participation, or (C) reduce the interest rate
payable under this Agreement and such Lender's Note, or (D) consent to the
assignment or the transfer by the Company or the Lessor of any of its rights and
obligations under this Agreement and (vi) except as contemplated by the
immediately preceding clause (v), no participant shall be deemed to be or to
have any of the rights or obligations of a "Lender" hereunder.
(g) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
11.06, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Company or the Guarantors furnished
to such Lender by or on behalf of the Company or the Guarantors; PROVIDED that,
prior to any such disclosure, the assignee or participant or proposed assignee
or participant shall agree in writing for the benefit of the Company and the
Guarantors to preserve the confidentiality of any confidential information
relating to the Company or the Guarantors received by it from such Lender in a
manner consistent with Section 11.13.
(h) Anything in this Agreement to the contrary
notwithstanding, any Lender may at any time create a security interest in all or
any portion of its rights under this Agreement (including, without limitation,
the Loans owing to it) and the Note issued to it hereunder in favor of any
Federal Reserve Bank in accordance with Regulation A of the Board of Governors
of the Federal Reserve System (or any successor regulation) and the applicable
operating circular of such Federal Reserve Bank.
(i) Notwithstanding any other provision of this Agreement or
any other Transaction Document, neither the Company nor the Guarantors nor any
of their respective Affiliates may acquire any of the Notes unless the Company,
such Guarantor or such Affiliate acquires all of the Notes in a single
transaction and thereby becomes bound by the provisions hereof; and unless the
Company, such Guarantor or such Affiliate shall have acquired all of the Notes,
it shall not be entitled to exercise any rights or remedies of a Lender under
any of the Transaction Documents.
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(j) Notwithstanding any other provision of this Agreement to
the contrary, no assignee or participant shall be entitled to receive any
greater payment under Section 4.06 or 5.03 than the transferor Lender would have
been entitled to receive with respect to the rights transferred, unless such
transfer is made with the Company's prior written consent or by reason of the
provisions of Section 5.02 or 5.03 hereof requiring such Lender to designate a
different Applicable Funding Office under certain circumstances or at a time
when the circumstances giving rise to such a greater payment did not exist.
Section 11.07 INVALIDITY. In the event that any one or more of
the provisions contained in the Notes, this Agreement or in any other
Transaction Document shall, for any reason, be held invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of the Notes, this Agreement or any other
Transaction Document.
Section 11.08 ENTIRE AGREEMENT. The Notes, this Agreement and
the other Transaction Documents embody the entire agreement and understanding
among the Lenders, the Lessor, the Agent, the Company and the Guarantors and
supersede all other agreements and understandings among such parties relating to
the subject matter hereof and thereof. This written Credit Agreement, the Notes
and the other Transaction Documents represent the final agreement among the
parties and may not be contradicted by evidence of prior, contemporaneous or
subsequent oral agreements of the parties. There are no unwritten oral
agreements among the parties.
Section 11.09 REFERENCES. The words "herein," "hereof,"
"hereunder" and other words of similar import when used in this Agreement refer
to this Agreement as a whole, and not to any particular article, section or
subsection. Any reference herein to an Article or Section shall be deemed to
refer to the applicable Article or Section of this Agreement unless otherwise
stated herein. Any reference herein to Schedule 8.31 or any other schedule shall
be deemed to refer to the applicable Schedule 8.31 or any other schedule
attached hereto unless otherwise stated herein.
Section 11.10 SUCCESSORS; SURVIVALS. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns. The obligations of the Lessor and the Company
under Section 4.06, Article V, and Section 11.03 shall survive the repayment of
the Loans and Lessor Investment Payments and the termination of the Commitments.
Section 11.11 CAPTIONS. Captions and section headings
appearing herein are included solely for convenience of reference and are not
intended to affect the interpretation of any provision of this Agreement.
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Section 11.12 COUNTERPARTS. This Agreement may be executed in
any number of counterparts, all of which taken together shall constitute one and
the same instrument and any of the parties hereto may execute this Agreement by
signing any such counterpart. Delivery to the Agent of a counterpart executed by
a Lender shall constitute delivery of such counterpart to all of the Lenders.
This Agreement may be delivered by facsimile transmission of the relevant
signature pages hereof.
Section 11.13 CONFIDENTIALITY. Each Lender, the Agent and the
Lessor (each, a "PARTY") agrees to exercise commercially reasonable efforts to
keep any information delivered or made available by the Company or any of its
Affiliates to it which is clearly indicated or stated to be confidential
information (or when the circumstances under which such information is delivered
or when the content thereof would cause a reasonable person to believe that such
information is confidential), confidential from anyone other than Persons
employed or retained by such Party who are or are expected to become engaged in
evaluating, approving, structuring or administering the Loans, the Lessor
Investment Payments or the Transaction Documents (such Persons to likewise be
under similar obligations of confidentiality with respect to such information);
PROVIDED, HOWEVER, that nothing herein shall prevent any Party from disclosing
such information (a) to any other Party, (b) upon the order of any court or
administrative agency, (c) upon the request or demand of any regulatory agency
or authority having jurisdiction over such Party, (d) which has been publicly
disclosed, (e) to the extent reasonably required in connection with any
litigation to which any Party or its respective affiliates may be a party, (f)
to the extent reasonably required in connection with the exercise of any remedy
hereunder, (g) to such Party's legal counsel and independent auditors, and (h)
to any actual or proposed participant, Eligible Assignee or other transferee of
all or part of its rights hereunder which has agreed in writing to be bound by
the provisions of this Section 11.13; PROVIDED that should disclosure of any
such confidential information be required by virtue of clause (b), (c) or (e) of
the immediately preceding sentence, any relevant Party shall promptly notify the
Company of same so as to allow the Company to seek a protective order or to take
any other appropriate action; PROVIDED, FURTHER, THAT no Party shall be required
to delay compliance with any directive to disclose beyond the last date such
delay is legally permissible any such information so as to allow the Company to
effect any such action.
Section 11.14 GOVERNING LAW; SUBMISSION TO JURISDICTION.
(a) This Agreement and the Notes (including, but not limited
to, the validity and enforceability hereof and thereof) shall be governed by,
and construed in accordance with, the laws of the State of New York, other than
the conflict of laws rules thereof, except to the extent that the laws of the
State of Florida mandatorily apply.
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(b) The Company hereby irrevocably submits to the jurisdiction
of any New York State or Federal court sitting in New York City and any
appellate court from any thereof in any action or proceeding by the Agent, the
Lessor or any Lender in respect of, but only in respect of, any claims or causes
of action arising out of or relating to this Agreement, the Notes or the other
Transaction Documents (such claims and causes of action, collectively, being
"PERMITTED CLAIMS"), and the Company hereby irrevocably agrees that all
Permitted Claims may be heard and determined in such New York State court or in
such Federal court. The Company hereby irrevocably waives, to the fullest extent
it may effectively do so, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any aforementioned court in respect
of Permitted Claims. The Company hereby irrevocably appoints CT Corporation
System (the "PROCESS AGENT"), with an office on the date hereof at 1633
Broadway, New York, New York 10019, as its agent to receive on behalf of the
Company and its property service of copies of the summons and complaint and any
other process which may be served by the Agent or the Lenders or the Lessor in
any such action or proceeding in any aforementioned court in respect of
Permitted Claims. Such service may be made by delivering a copy of such process
to the Company by courier and by certified mail (return receipt requested), fees
and postage prepaid, both (i) in care of the Process Agent at the Process
Agent's above address and (ii) at the Company's address specified pursuant to
Section 11.02, and the Company hereby irrevocably authorizes and directs the
Process Agent to accept such service on its behalf. The Company agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.
(c) Nothing in this Section 11.14: (i) shall affect the right
of any Lender, the Lessor or the Agent to serve legal process in any other
manner permitted by law or affect any right otherwise existing of any Lender,
the Lessor or the Agent to bring any action or proceeding against the Company or
its property in the courts of other jurisdictions or (ii) shall be deemed to be
a general consent to jurisdiction in any particular court or a general waiver of
any defense or a consent to jurisdiction of the courts expressly referred to in
subsection (a) above in any action or proceeding in respect of any claim or
cause of action other than Permitted Claims.
Section 11.15 INTEREST. It is the intention of the parties
hereto that each Lender and the Lessor shall conform strictly to usury laws
applicable to it. Accordingly, if the transactions contemplated hereby would be
usurious as to any Lender or the Lessor under laws applicable to it (including
the laws of the United States of America and the State of New York or any other
jurisdiction whose laws may be mandatorily applicable to such Lender or the
Lessor notwithstanding the other provisions of this Agreement), then, in that
event, notwithstanding anything to the contrary in the Notes, this Agreement or
in any other Transaction Document or any other agreement entered into in
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connection with or as security for the Notes or the Lessor Investment, it is
agreed as follows: (i) the aggregate of all consideration which constitutes
interest under law applicable to any Lender or the Lessor that is contracted
for, taken, reserved, charged or received by such Lender or the Lessor under or
with respect to the Notes, the Lessor Investment, this Agreement or under any of
the other aforesaid Transaction Documents or other agreements or otherwise in
connection with the Notes or the Lessor Investment shall under no circumstances
exceed the maximum amount allowed by such applicable law, and any excess shall
be cancelled automatically and if theretofore paid shall be credited by such
Lender or the Lessor on the principal or face amount of the Notes or the Lessor
Investment, as the case may be (or, to the extent that the principal or face
amount of the Notes or the Lessor Investment shall have been or would thereby be
paid in full, refunded by such Lender or the Lessor); and (ii) in the event that
the maturity of the Notes or the Lessor Investment is accelerated by reason of
an election of the holder thereof resulting from any Event of Default under this
Agreement or otherwise, or in the event of any required or permitted prepayment,
then such consideration that constitutes interest under law applicable to any
Lender or the Lessor may never include more than the maximum amount allowed by
such applicable law, and excess interest, if any, provided for in this Agreement
or otherwise shall be cancelled automatically by such Lender or the Lessor as of
the date of such acceleration or prepayment and, if theretofore paid, shall be
credited by such Lender or the Lessor on the principal or face amount of the
Notes or the Lessor Investment, as the case may be (or, to the extent that the
principal or face amount of the Notes or the Lessor Investment shall have been
or would thereby be paid in full, refunded by such Lender or the Lessor). All
sums paid or agreed to be paid to any Lender for the use, forbearance or
detention of sums due hereunder shall, to the extent permitted by law applicable
to such Lender, be amortized, prorated, allocated and spread in equal parts
throughout the full term of the Loans evidenced by the Notes, and all sums paid
or agreed to be paid to the Lessor for the use, forbearance or detention of sums
due hereunder with respect to the Lessor Investment shall, to the extent
permitted by law applicable to the Lessor, be amortized, prorated, allocated and
spread in equal parts throughout the full term of the Lessor Investment, in each
case until payment in full so that the rate or amount of interest on account of
any Loans and Lessor Investment hereunder does not exceed the maximum amount
allowed by such applicable law. If at any time and from time to time (i) the
amount of interest or Yield payable to any Lender or the Lessor on any date
shall be computed at the Highest Lawful Rate applicable to such Lender or the
Lessor pursuant to this Section 11.15 and (ii) in respect of any subsequent
interest or Yield computation period the amount of interest or Yield otherwise
payable to such Lender or the Lessor would be less than the amount of interest
or Yield payable to such Lender or the Lessor computed at the Highest Lawful
Rate applicable to such Lender or the Lessor, then the amount of interest or
Yield payable to such Lender or the Lessor in respect of such
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subsequent interest or Yield computation period shall continue to be computed at
the Highest Lawful Rate applicable to such Lender or the Lessor until the total
amount of interest or Yield payable to such Lender or the Lessor shall equal the
total amount of interest or Yield which would have been payable to such Lender
or the Lessor if the total amount of interest or Yield had been computed without
giving effect to this Section.
Section 11.16 CHARACTERIZATION.
(a) In order to protect the rights and remedies of the Lessor,
the Agent and the Lenders following a Default, an Event of Default, a
Termination Event or a Cancellation Event, and for the purposes of Federal,
state and local income and AD VALOREM taxes and Title 11 of the United States
Code (or any other applicable Federal, state or local insolvency,
reorganization, moratorium, fraudulent conveyance or similar law now or
hereafter in effect for the relief of debtors), the parties hereto intend that
(i) the Lease be treated as the repayment and security provisions of a loan by
the Lessor to the Company in the amount of the Facility Cost, (ii) all payments
of Basic Rent, Supplemental Rent, the Final Rent Payment or the Completion Costs
Payment, as applicable, the Termination Value and the Purchase Price be treated
as payments of principal, interest and other amounts owing with respect to such
loan and (iii) the Company be treated as entitled to all benefits of ownership
of the Facility and other Property included under the Lease or any part thereof.
In addition, the parties acknowledge that after payment in full of the Notes and
the Lessor Investment, the interest and Yield accrued thereon and any other
obligations of the Company under the Transaction Documents, any remaining
proceeds of the Facility and other Property included under the Lease shall be
distributed to the Company.
(b) The Company agrees that neither it nor any of its
Affiliates (whether or not consolidated or combined returns are filed for any
such Affiliate and the Company for federal, state or local income tax purposes)
will at any time take any action, directly or indirectly, or file any return or
other document inconsistent with the intended income tax treatment set forth in
the preceding sentence, and the Company agrees that the Company and any such
Affiliates will file such returns, maintain such records, take such action and
execute such documents (as reasonably requested by the Lessor, the Agent or the
Lenders from time to time) as may be appropriate to facilitate the realization
of such intended income tax treatment. Each of the Lessor, the Agent and the
Lenders agrees that neither it nor any affiliate (whether or not consolidated or
combined returns are filed for such affiliate and the Lessor, the Agent or any
Lender, as the case may be, for federal, state or local income tax purposes)
will at any time take any action, directly or indirectly, or file any return or
other document claiming, or asserting that it is entitled to, the income tax
benefits, deductions and/or credits which, pursuant to the intended income tax
treatment set forth
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herein, would otherwise be claimed or claimable by the Company, and that it and
any such affiliates will file such returns, maintain such records, take such
actions, and execute such documents (as reasonably requested by the Company or
the Guarantor from time to time) as may be appropriate to facilitate the
realization of, and as shall be consistent with, such intended income tax
treatment, and if any such filing, maintenance, action or execution requested by
the Company would result in any additional income tax liability payable by it or
any affiliate, or could reasonably be expected to result in liability payable by
it or any affiliate, unrelated to the intended income tax treatment set forth
herein, then the Company will provide an indemnity against such unrelated income
tax liability satisfactory to the Lessor, the Agent or any Lender, as the case
may be, in its sole opinion.
(c) The Company acknowledges that neither any Lender, the
Agent, the Lessor or any Affiliate of any thereof is making any representation,
nor is it required to make any disclosure, now or in the future, with respect to
the parties' tax or accounting treatment of the Facility or the financing
thereof, nor is any Lender, the Agent, the Lessor or any Affiliate or any
thereof responsible, nor will it be responsible in the future, for tax and
accounting advice with respect to the Facility or the financing thereof, and the
Company has had or will have the benefit of the advice of its own independent
tax and accounting advisors with respect to such matters.
Section 11.17 COMPLIANCE. Neither the Lessor, the Agent nor
any Lender has any responsibility for compliance by the Facility or the Company
with any Governmental Requirement or other matters. The Company expressly
assumes such responsibilities and shall indemnify and hold harmless the Lessor,
the Agent and the Lenders with respect thereto in the manner provided in the
Lease.
Section 11.18 FACILITY. Upon payment by the Company of the
Purchase Price in connection with its purchase of all of the Facility in
accordance with the Lease or the Agency Agreement, or the repayment in full of
all amounts then due and owing by the Company under the Transaction Documents,
and promptly upon the request of the Company, (i) the Agent shall give to the
Lessor notice thereof and (ii) the Lessor will convey the Facility to the
Company or its designee, as provided in the Lease, free and clear of any Lien or
other adverse interest of any kind created by the Lessor or any Person claiming
by, through or under the Lessor, including, without limitation, the Agent and
the Lenders (except as consented to by the Company).
Section 11.19 THE LESSOR. Except for liability for its own
representations and warranties in Section 7.02 hereof, and for its own gross
negligence and willful misconduct and as otherwise expressly provided in any of
the Transaction Documents, the Company, the Agent and the Lenders hereby agree
that under no circumstances shall the Lessor be personally liable for the
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payment of the Notes or any other obligations of the Lessor (all of which are
non-recourse to it) or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Lessor under this
Agreement or the other Transaction Documents except as provided above, and all
claims to the contrary hereby are waived. The Lessor agrees that all payments to
be made to the Agent or the Lessor under any of the Transaction Documents which
originate from the Company or the Guarantors shall be made directly by the
Company or the Guarantors to the Agent and all fundings to be made to the Lessor
hereunder shall be made directly to the Company.
Section 11.20 LENDERS. No recourse under any obligation,
covenant or agreement of any Lender contained in this Agreement, any Transaction
Document or any agreement or document executed in connection herewith or
therewith or the transactions contemplated hereby or thereby shall be had
against any shareholder, employee, officer, director, affiliate or incorporator
of the Lenders. The obligations, covenants and agreements of the Lenders under
any of the foregoing agreements and documents are solely the corporate
obligations of the Lenders, and the other parties hereto agree to look solely to
the Lenders for payment of all obligations, including, without limitation, any
fees or other amounts due hereunder or thereunder, and claims arising out of or
relating to any of the foregoing agreements and documents. The provisions of
this Section shall survive the termination of this Agreement.
Section 11.21 WAIVER OF JURY TRIAL. Each of the parties hereto
waives, to the fullest extent permitted by applicable law, any right to a trial
by jury in any action or proceeding to enforce or to defend any rights under
this Agreement or any other Transaction Document or under amendment, instrument,
document or agreement delivered or which may in the future be delivered in
connection herewith or therewith or arising from any relationship existing in
connection with this Agreement or any other Transaction Document, and agrees
that any such action or proceeding shall be tried before a court and not before
a jury.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
The Company: THE VINCAM GROUP, INC.
By:/s/ ELIZABETH J. KEELER
------------------------------
Name: Elizabeth J. Keeler
Title: Vice President
Principal Place of Business and
Chief Executive Offices:
2850 Douglas Road
Coral Gables, Florida 33134
Lessor: FLEET REAL ESTATE, INC.
By:/s/ J.C. HART
-----------------------------
Name: J.C. Hart
Title: S.V.P
Applicable Funding Office for
Lessor Investment Payments:
Fleet Real Estate, Inc.
One Federal Street
Boston, Massachusetts 02109
Address for Notices:
Fleet Real Estate, Inc.
One Federal Street
Boston, Massachusetts 02109
Telecopier No.: 617-346-0513
Telephone No.: 617-346-4976
Attention: Jay Hart
Agent: FLEET NATIONAL BANK, as Agent
By:/s/ GINGER STOLZENTHALER
-----------------------------
Name: G. Stolzenthaler
Title: Senior Vice President
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Lenders: FLEET REAL ESTATE CAPITAL, INC.
By:/s/ MARK E. CONNORS, SVP
------------------------------
Name: Mark E. Connors
Title: Senior Vice President
Applicable Funding Office for Loans:
Fleet Real Estate Capital, Inc.
One Federal Street
Boston, Massachusetts 02109
Telecopier No.: 617-346-0047
Telephone No.: 617-346-4920
Attention: Mark Connors
Address for Notices:
Fleet Real Estate Capital, Inc.
One Federal Street
Boston, Massachusetts 02109
Telecopier No.: 617-346-0047
Telephone No.: 617-346-4920
Attention: Mark Connors
NATIONSBANK, N.A.
By:/s/ STUART A. HALL
--------------------------------
Name: Stuart A. Hall
Title: Vice President
Applicable Funding Office for Loans:
NationsBank, N.A.
100 Southeast 2nd Street
Miami, Florida 33131
Address for Notices:
NationsBank, N.A.
100 Southeast 2nd Street
Mail Code FL7-950-15-03
Miami, Florida 33131
Telecopier No.: 305-533-2681
Telephone No.: 305-533-2669
Attention: Steven Mayer
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SUNTRUST BANK, MIAMI, N.A.
By:/s/ JANET SAMMONS
-------------------------------
Name: Janet Sammons
Title: Vice President
Applicable Funding Office for Loans:
SunTrust Bank, Miami, N.A.
777 Brickell Avenue
Miami, Florida 33131-2803
Address for Notices:
SunTrust Bank, Miami, N.A.
Mail Code 1042
777 Brickell Avenue
Miami, Florida 33131-2803
Telecopier No.: 305-579-7133
Telephone No.: 305-579-7132
Attention: Jack Walker
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SCHEDULE 1.02
Defined Terms
The following terms shall have the following meanings (all terms defined in the
singular to have the same meanings when used in the plural and VICE VERSA):
"ACCOUNTANTS" shall mean Price Waterhouse LP or another
accounting firm of national reputation or, with the approval of the Agent, any
other certified public accountants selected by the Company, which approval shall
not be unreasonably withheld or delayed, if such other certified public
accountants are nationally recognized.
"ACCRUED CONSTRUCTION TERM YIELD": as defined in Section
3.03(c) of the Credit Agreement.
"ACQUISITION/CONSTRUCTION AGENT": the Company, as acquisition
and construction agent for the Lessor with respect to the Facility pursuant to
the Agency Agreement.
"ADJUSTED EBITDA" shall mean, in respect of the Company or any
Person, as the case may be, EBITDA of the Company and the Guarantors on a
consolidated basis or such Person for the twelve-month period then ended less
(i) EBITDA for each Acquired Company for such fiscal period plus (ii) EBITDA for
each Acquired Company on a pro forma basis for the twelve months preceding the
end of such fiscal period, provided, however, that the EBITDA for Acquired
Companies may be adjusted, for certain one-time savings or other acquisition
related costs identified to and approved in each instance by the Agent such as
NORMALIZATION of owners' salaries and adjustments for certain non cash charges.
"ADJUSTED LIBO RATE": with respect to any Interest Period or
Yield Period, a rate per annum equal to the quotient obtained (rounded upwards,
if necessary, to the next higher 1/16th of 1%) by dividing (i) the applicable
LIBO Rate for such Interest Period or Yield Period by (ii) 1.00 minus the
Eurodollar Reserve Percentage.
"ADVANCE NOTICE": in connection with any Borrowing or any
Lessor Investment Payment, notice given by telecopy or telephone (and if by
telephone, confirmed promptly by telecopier) to be received by the Agent not
later than 12:00 noon, prevailing Eastern time, on the third (3rd) Business Day
before the requested date of such Borrowing, or Lessor Investment Payment or
continuation.
"AFFILIATE": with respect to the Lessor, the Company
or the Guarantors, as the case may be, (i) any Person that,
directly or indirectly, through one or more intermediaries,
controls the Lessor, the Company or the Guarantors, as the case
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may be (a "CONTROLLING PERSON"), (ii) any Person (other than the Lessor, the
Company, the Guarantors) which is controlled by or is under common control with
a Controlling Person, or (iii) any Person (other than a Subsidiary) of which the
Company owns, directly or indirectly, 20% or more of the common stock or
equivalent equity interests. As used herein, the term "control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"AGENT": Fleet National Bank, a national banking association,
in its capacity as agent for the Lenders and the Lessor (with respect to
payments pertaining to the Lessor Investment), together with its successors in
such capacity.
"AGENCY AGREEMENT": the Agency, Indemnity and Support
Agreement, of even date with the Credit Agreement, between the Lessor and the
Company, as Acquisition/Construction Agent, as amended, supplemented or
otherwise modified from time to time.
"AGGREGATE CONSTRUCTION COSTS": the aggregate amount of all
Facility Costs, including all acquisition costs for the Improvements and
Capitalized Expenses, EXCLUDING, HOWEVER, the cost of the acquisition of the
Site.
"AGGREGATE LOAN COMMITMENTS": the sum of the Aggregate Tranche
A Loan Commitments and the Aggregate Tranche B Loan Commitments, as the same may
be reduced at the request of the Company in accordance with Section 2.03 of the
Credit Agreement.
"AGGREGATE TRANCHE A LOAN COMMITMENTS": the lesser of (i) an
amount equal to 85% of the Facility Cost, or (ii) $10,200,000, as the same may
be reduced at the request of the Company in accordance with Section 2.03 of the
Credit Agreement.
"AGGREGATE TRANCHE B LOAN COMMITMENTS": the lesser of (i) an
amount equal to 12% of the Facility Cost, or (ii) $1,440,000, as the same may be
reduced at the request of the Company in accordance with Section 2.03 of the
Credit Agreement.
"AGGREGATE USE CHARGE": for any Rental Period, the sum of the
Daily Use Charges for that Rental Period.
"APPLICABLE FUNDING OFFICE": for each Lender or the Lessor,
the funding office of such Lender or the Lessor (or an affiliate thereof)
designated for any Loan or Lessor Investment Payment on the signature pages of
the Credit Agreement (or in an Assignment and Acceptance executed by such Lender
pursuant to Section 11.06 of the Credit Agreement) or such other offices of such
Lender or the Lessor (or of an affiliate of such Lender or the Lessor) as such
Lender or the Lessor may from time to time specify to the Agent, the Lessor and
the Company as the office by which its Loans or Lessor Investment Payments, as
applicable, are to be made and maintained.
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"APPLICABLE MARGIN": with respect to (i) the Tranche A Loans,
the "Applicable Tranche A Loan Margin", (ii) the Tranche B Loans, the
"Applicable Tranche B Loan Margin", and (iii) the Lessor Investment, the
"Applicable Lessor's Investment Margin", respectively, as each of those terms is
defined in the Pricing Schedule.
"APPLICABLE PERMIT": any Permit that is or may be necessary to
own, renovate, construct, install, start-up, test, maintain, modify, expand,
remove, operate, lease or use all or any part of the Facility (including,
without limitation, the Site or any business conducted on or related to the
Facility or the Site) or any portion thereof, and the failure to obtain or
maintain which would have a Material Adverse Effect.
"APPROVED APPRAISAL": an appraisal, ordered by the Agent, but
at the Company's cost, from an independent MAI appraiser or appraisers
satisfactory to the Agent, the Lessor and the Lenders, in their sole discretion:
(a) on or prior to the Closing Date, to the effect that as of the Closing Date
(i) the fair Market Value of the Facility does not exceed the Facility Cost
attributable thereto and applied to the acquisition thereof and (ii) the fair
Market Value of the Facility on an "as-completed" basis in accordance with the
Facility Plan is not estimated to be less than the projected Facility Cost and
specifying such estimated fair Market Value, and setting forth the estimated
fair Market Value of the Facility on an "as completed" basis in accordance with
the Facility Plan as of the expiration of the Basic Term; and (b) on the
Completion Date, "bringing down" the Approved Appraisal by the original
appraiser as of the Completion Date with respect to the Facility upon Completion
showing fair Market Value of the Facility; in each case which (1) complies with
Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of
1989, as amended, 12 U.S.C. 3331, ET SEQ., and The Regulations and Statements of
General Policy on Appraisals promulgated by the Federal Deposit Insurance
Corporation, 12 C.F.R. Part 32, as amended, and (2) is performed by a
state-certified real estate appraiser certified under the laws of any State.
"ASSIGNMENT AND ACCEPTANCE": an Assignment and Acceptance
Agreement, in the form of EXHIBIT D to the Credit Agreement entered into by a
Lender and an Eligible Assignee.
"AUTHORIZED OFFICERS": with respect to the Company or the
Guarantors, the officers whose signatures and incumbency shall have been
certified to the Agent and the Lessor in a certificate certified by the
Secretary or an Assistant Secretary of the Company or the Guarantors, as
applicable, in form and substance reasonably satisfactory to the Agent.
"BANKING AUTHORITY": as defined in Section 5.02 of the Credit
Agreement.
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"BASE RATE": for any day, the rate per annum equal to the
higher as of such day of (I) the Prime Rate, and (II) one-half of one percent
above the Federal Funds Rate. For purposes of determining the Base Rate for any
day, changes in the Prime Rate shall be effective on the date of each such
change.
"BASIC RENT": with respect to any Rental Period, the Aggregate
Use Charge for such Rental Period.
"BASIC TERM": with respect to the Lease, and subject to the
terms and conditions set forth therein and in the other Transaction Documents,
the period commencing on the Completion Date, and ending on the earlier to occur
of (i) the Option Date, (ii) the Cancellation Date, (iii) a Non-Completion
Event, or (iv) the Scheduled Lease Termination Date.
"BORROWING": a borrowing consisting of Loans to the Lessor
made on the same day by the Lenders.
"BUSINESS DAY": (i) for all purposes other than as set forth
in clause (ii) below, any day except Saturday, Sunday or other day on which
commercial banks in New York, New York and Boston, Massachusetts are authorized
or required by law or other government action to close, and (ii) with respect to
all notices and determinations in connection with, and payments of principal of
and interest on, the Loans and payments of, any day that is a Business Day
described in clause (i) above and that is also a day for trading by and between
banks in the London interbank eurodollar market.
"CANCELLATION DATE": as defined in Section 15(b) of the Lease.
"CANCELLATION EVENT": as defined in Section 15(b) of the
Lease, and shall include a Loss Event.
"CAPITAL EXPENDITURES": means all expenditures made in respect
of the cost of any fixed asset or improvement, or replacement, substitution, or
addition thereto, having a useful life of more than one (1) year, including,
without limitation, Capitalized Expenses and those arising in connection with
the direct or indirect acquisition of such assets by way of increased product or
service charges or offset items or in connection with capital leases, but
excluding expenditures in respect of Permitted Acquisitions.
"CAPITAL LEASE OBLIGATIONS" : as to any Person, the
obligations of such Person to pay rent or other amounts under a lease of (or
other agreement conveying the right to use) real and/or personal property which
obligations are required to be classified and accounted for as a capital lease
on a balance sheet of such Person under GAAP (including Statement of Financial
Accounting Standards No. 13 of the Financial Accounting Standards Board) and,
for purposes of this Agreement, the amount of such
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obligations shall be the capitalized amount thereof, determined in accordance
with GAAP (including such Statement No. 13).
"CAPITALIZATION" shall mean, at any date, the sum, calculated
in accordance with GAAP, of total stockholders equity of the Company plus Total
Funded Debt.
"CAPITALIZED EXPENSES": all acquisition, design and
construction costs and all legal, architectural, engineering and other
professional fees and expenses, brokerage fees, appraisal fees, environmental
assessment fees, title insurance, survey expenses, mortgage recording fees and
taxes, intangibles taxes, and other "soft costs" of a nature ordinarily and
reasonably incurred in connection with the acquisition, design, engineering,
construction, assembly, installation, testing, improvement and completion of
property substantially similar to the Facility (including soft and hard costs
previously incurred not to exceed 10% of all Facility Cost) and all Basic Rent,
commitment and other fees accrued prior to the Completion Date. "Capitalized
Expenses" shall not include fixtures, furniture or equipment included in,
attached to or otherwise relating to the Site or the Facility.
"CAPITAL STOCK": any nonredeemable capital stock of the
Company or any Consolidated Subsidiaries (to the extent issued to a Person other
than the Guarantors or the Company) whether common or preferred.
"CASH COLLATERAL": as defined in Section 2.02(c) of the Credit
Agreement.
"CASUALTY OCCURRENCE": any of the following events in respect
of the Facility, (i) any material loss of the Facility or material loss of use
thereof which does not constitute a Loss Event, or (ii) the condemnation,
confiscation or seizure of, or requisition of title to or use of, any material
part of the Facility which action does not constitute a Loss Event.
"CERCLA": the Comprehensive Environmental Response
Compensation and Liability Act, 42 U.S.C. ss. 9601 et. seq. and its implementing
regulations and amendments.
"CERCLIS": the Comprehensive Environmental Response
Compensation and Liability Inventory System established pursuant to CERCLA.
"CHANGE OF CONTROL": (i) any Person or two or more Persons
acting in concert shall have acquired beneficial ownership (within the meaning
of Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of 25% or more of the outstanding shares of the voting
stock of the Company; or (ii) as of any date a majority of the Board of
Directors of the Company consists of individuals who were not
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either (a) directors of the Company as of the corresponding date of the previous
year, (b) selected or nominated to become directors by the Board of Directors of
the Company of which a majority consisted of individuals described in clause
(a), or (c) selected or nominated to become directors by the Board of Directors
of the Company of which a majority consisted of individuals described in clause
(a) and individuals described in clause (b).
"CHANGE OF LAW": as defined in Section 5.02 of the Credit
Agreement.
"CLOSING DATE": December 9, 1997.
"CODE": the Internal Revenue Code of 1986, as amended, and any
successor Federal tax code.
"COLLATERAL": as defined in Section 26 of the Lease.
"CO-LESSEE": as defined in Section 21(b) of the Lease.
"COMMITMENT": as to each Lender, an amount equal to such
Lender's Loan Commitments and as to the Lessor, the amount of its Lessor
Investment Commitment, as applicable, then in effect.
"COMPANY": The Vincam Group, Inc., a Florida corporation, and
its successors.
"COMPLETION": the occurrence and satisfaction of all of the
events and conditions described on SCHEDULE 1.02(B) to the Credit Agreement on a
single date to the reasonable satisfaction of the Majority Lenders.
"COMPLETION CERTIFICATE": a certificate of the Company in
substantially the form of EXHIBIT A to the Agency Agreement, certifying that
Completion of the Facility has occurred.
"COMPLETION COSTS": at any time the sum of (x) the aggregate
amount of Construction Costs (including acquisition costs, except with respect
to the Site, and soft costs) expended or incurred as of the time of a
Non-Completion Event and which it will be necessary thereafter to expend in
order to achieve Completion, plus (y) all Impositions thereon.
"COMPLETION COSTS PAYMENT": an amount, which is payable upon
the occurrence of a Non-Completion Event, equal to the sum of (i) the
acquisition cost of the Site, (ii) the aggregate amount of all Completion Costs,
up to but not in excess of the Completion Costs Payment Limitation, and (iii)
all Supplemental Rent and other amounts owing by the Company under the
Transaction Documents (other than any Completion Costs in excess of the
Completion Costs Payment Limitation).
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"COMPLETION COSTS PAYMENT LIMITATION" means an amount equal to
89% of the Aggregate Construction Costs.
"COMPLETION DATE": the earlier to occur of (i) the date on
which the Company, as Project Agent for the Lessor, delivers the Completion
Certificate and (ii) the date that is twelve (12) months after the Lease
Commencement Date.
"COMPLETION DATE APPRAISED AMOUNT": the Fair Market Value of
the Facility as set forth in the bring-down of the Approved Appraisal delivered
on the Completion Date as required by clause (b) of the definition of Approved
Appraisal.
"CONSOLIDATED SUBSIDIARY": a Subsidiary, the accounts of which
are customarily consolidated with those of the Company for the purpose of
reporting to stockholders of the Company, or to the Agent and each of the
Lenders, or, in the case of a recently acquired Subsidiary, the accounts of
which would, in accordance with the Company's regular practice, be so
consolidated for that purpose.
"CONSOLIDATED TOTAL ASSETS": at any time, the total assets of
the Company and its Consolidated Subsidiaries, determined on a consolidated
basis, as set forth or reflected on the most recent consolidated balance sheet
of the Company and its Consolidated Subsidiaries, prepared in accordance with
GAAP.
"CONSTRUCTION TERM": the period commencing on the Lease
Commencement Date and ending on the Completion Date.
"CONSTRUCTION TERM YIELD": all Yield that shall accrue during
the Construction Term with respect to the Lessor Investment.
"CONTRACTUAL OBLIGATION": any provision of any security issued
by the Company or of any agreement, instrument or other undertaking to which the
Company is a party or by which it or any of its property is bound.
"CONTRIBUTION AGREEMENT" means the Contribution Agreement of
even date herewith in substantially the form of EXHIBIT G to the Credit
Agreement to be executed by the Borrower and the Guarantors.
"CONTROLLED GROUP": all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Company, are treated as a single
employer under Section 414 of the Code.
"CREDIT AGREEMENT": the Credit and Investment Agreement, dated
as of the Closing Date, among the Company, the Lessor, the Agent and the
Lenders, as amended, supplemented, renewed, extended or otherwise modified from
time to time.
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"CURRENT ASSETS": means, as of any applicable date, all
amounts that should, in accordance with GAAP, be included as current assets on
the consolidated balance sheet of the Company as at such date.
"CURRENT LIABILITIES": means, as of any applicable date, all
amounts that should be, in accordance with GAAP, be included as current
liabilities on the consolidated balance sheet of the Company and the Guarantors,
as at such date.
"DAILY USE CHARGE": for any day (whether or not a Business
Day) during the Lease Term the sum of (i) all liabilities of the Lessor for
interest on the Loans and Yield (excluding Accrued Construction Term Yield), but
including, without limitation, all Yield accruing during the Basic Term on the
Lessor Investment and payments of Accrued Construction Term Yield during the
Basic Term) accruing for such day pursuant to and in accordance with the Credit
Agreement, and (ii) all liabilities of the Lessor for commitment and other fees
accruing for such day pursuant to the Credit Agreement.
"DEFAULT": any condition or event that constitutes an Event of
Default or that with the giving of notice or the lapse of time or both would,
unless cured or waived, become an Event of Default.
"DEFAULT RATE": on any day, with respect to (i) the Tranche A
Loans, the "Default Tranche A Loan Margin", (ii) the Tranche B Loans, the
"Default Tranche B Loan Margin", and (iii) the Lessor Investment, the "Default
Investment Margin", respectively, as each of those terms is defined in the
Pricing Schedule.
"DOLLARS" and "$": dollars in lawful currency of the United
States of America.
"EBITDA": for any fiscal period,-an amount equal to Net Income
for such period, plus each of the following (without duplication), to the extent
deducted in computing such Net Income: (i) Interest Expense, (ii) taxes accrued,
(iii) depreciation, and (iv) amortization of goodwill and other intangibles.
"ELIGIBLE ASSIGNEE": with respect to any particular assignment
under Section 11.06 of the Credit Agreement, any bank or other financial
institution consented to by the Company and the Agent if such bank or other
financial institution is not already a Lender or an affiliate of a Lender;
PROVIDED that neither the Agent's nor the Company's consent shall be
unreasonably withheld and, provided, further, that such consent of the Company
shall not be required if an Event of Default is in existence.
"ENVIRONMENTAL ASSESSMENT": collectively, a Phase 1 report
conducted by an independent engineering firm reasonably
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acceptable to the Lessor and the Agent in scope and substance satisfactory to
the Lessor and the Agent, and in any event satisfying the minimum standards set
forth in ASTME 1527-94 (and, if recommended in or indicated by the Phase 1
report, a Phase 2, environmental soil test or other environmental report or
reports), reflecting compliance of the Facility in all material respects with
all applicable Environmental Requirements.
"ENVIRONMENTAL AUTHORITY": any foreign, federal, state, local
or regional Governmental Authority that exercises any form of jurisdiction or
authority under any Environmental Requirement.
"ENVIRONMENTAL AUTHORIZATIONS": all licenses, permits, orders,
approvals, notices, registrations or other legal prerequisites for conducting
the business of the Company or any Guarantor, or for the uses and activities of,
on or relating to the Facility, required by any Environmental Requirement.
"ENVIRONMENTAL DAMAGES": any and all claims, losses, costs,
damages, penalties and expenses which are incurred at any prior or subsequent
time as a result of the existence or release of Hazardous Materials upon, about
or beneath the Facility or migrating or threatening to migrate to or from the
Facility, or the existence of a violation of Environmental Requirements
pertaining to the Facility, regardless of whether the existence of such
Hazardous Materials or the violation of Environmental Requirements arose prior
to the present ownership or operation of the Facility.
"ENVIRONMENTAL JUDGMENTS AND ORDERS": all judgments, decrees
or orders arising from or in any way associated with any Environmental
Requirements, whether or not entered upon consent or written agreements with an
Environmental Authority or other entity arising from or in any way associated
with any Environmental Requirement, whether or not incorporated in a judgment,
decree or order.
"ENVIRONMENTAL LIABILITIES": any liabilities or Liens, whether
accrued, contingent or otherwise, arising from and in any way associated with
any Environmental Requirements.
"ENVIRONMENTAL NOTICES": notice from any Environmental
Authority or by any other Person, of possible or alleged noncompliance with or
liability under any Environmental Requirement, including without limitation any
complaints, citations, demands or requests from any Environmental Authority or
from any other person or entity for correction of any violation of any
Environmental Requirement or any investigations concerning any violation of any
Environmental Requirement.
"ENVIRONMENTAL PROCEEDINGS": any judicial or administrative
proceedings arising from or in any way associated with any Environmental
Requirement.
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"ENVIRONMENTAL RELEASE": any actual or threatened release
defined in CERCLA or under any state or local environmental law or regulation.
"ENVIRONMENTAL REQUIREMENTS": any statue, rule, regulation,
ordinance, permit, license administration or judicial decision or order (whether
by consent or otherwise) or the requirement of law with respect to: (i) the
protection of human health and/or the environment; (ii) the existence, handling,
use, generation, treatment, storage, packaging, labelling, removal or
Environmental Release of Hazardous Materials on, under, about and/or from any
real property, including the Facility; and (iii) the effects on the environment
of any activity now, previously, or hereinafter conducted on any real property,
including the Facility. The Environmental Requirements shall include, but not be
limited to, the following: CERCLA; the Superfund Amendments and Reauthorization
Act, Public Law 99-499, 100 Stat. 1613; the Resource Conservation and Recovery
Act, 42 U.S.C. ss.ss. 6901, ET SEQ.; the Toxic Substances Control Act, 15 U.S.C.
ss.ss. 2601, ET SEQ.; the Federal Water Pollution Control Act, 33 U.S.C. ss.ss.
1251, ET SEQ.; the Clean Air Act, 42 U.S.C. ss.ss. 7401, ET SEQ.; the
Occupational Safety and Health Act, 29 U.S.C. ss.ss. 651, ET SEQ.; the Emergency
Planning and Community Right-To-Know Act of 1986, 42 U.S.C. ss.ss. 11001, ET
SEQ.; the state and local analogies thereto, all as amended or superseded from
time to time; and any common-law doctrine, including but not limited to,
negligence, nuisance, strict liability, trespass, personal injury, or property
damage related to or arising out of the presence, Environmental Release or
exposure to a Hazardous Material; and all federal, state and local ordinances,
regulations, orders, writs and decrees.
"ERISA": the Employee Retirement Income Security Act of 1974,
as amended from time to time, or any successor law and the regulations
promulgated and rulings issued from time to time thereunder. Any reference to
any provision of ERISA shall also be deemed to be a reference to any successor
provision or provisions thereof.
"EUROCURRENCY LIABILITIES": as defined in Regulation
D.
"EURODOLLAR RESERVE PERCENTAGE": for any day the percentage
(expressed as a decimal) that is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in respect of "Eurocurrency liabilities" (or in respect of any
other category of liabilities which includes deposits by reference to which the
interest rate on loans made at the LIBO Rate is determined or any category of
extensions of credit or other assets which includes loans by a non-United States
office of any Lender to United States residents). The Adjusted LIBO Rate shall
be adjusted automatically on and as of the effective date of any change in the
Eurodollar Reserve Percentage.
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"EVENT OF DEFAULT": as defined in Section 9.01 of the Credit
Agreement or in Section 17 of the Lease.
"EXCESS AMOUNT FUNDED": as defined in Section 2.02(c) of the
Credit Agreement.
"EXCLUDED EQUIPMENT": any equipment, trade fixtures (which are
readily removable from the Site) and other items of personal property which (i)
are not purchased with the proceeds of Loans or Lessor Investment Payments and
(ii) are not replacements of or substitutions for property which was purchased
with the proceeds of Loans or Lessor Investment Payments.
"EXCLUDED PROPERTY": all real and tangible personal property
(but not any accounts, general intangibles or instruments or any proceeds of
accounts, general intangibles or instruments) subject to a lien or security
interest created by that certain Florida Real Estate Mortgage and Security
Agreement, dated November 2, 1993, as amended by that certain Addendum dated
November 2, 1993, and that certain Second Addendum dated November 2, 1993, made
by the Company in favor of Consolidated Bank, N.A., as in effect and delivered
to the Lenders on the date hereof, but not any subsequent amendments thereto.
"FACILITY": the collective reference to (i) the Lessor's fee
simple estate in the Site, (ii) the building and related enhancements and
improvements to be constructed on the Site in accordance with the Facility Plan,
together with all accessions thereto and replacements thereof, and together with
all accessories, equipment, parts and devices necessary to achieve Completion,
and all fixtures now or hereafter included in or attached to the Site, the
building and such enhancements and improvements and modifications, and (iii) all
plans, specifications, warranties and related rights and operating, maintenance
and repair manuals related thereto and all replacements of any of the above;
PROVIDED, HOWEVER, that the term "Facility" shall not include any of the
Excluded Equipment.
"FACILITY COST": an aggregate amount equal to the lesser of:
(i) the sum of (a) all costs associated with the Lessor's acquisition of a fee
simple estate in the Site, up to but not exceeding $2,600,000 and any
refinancing thereof, and (b) all of the capitalized costs and expenses of any
kind or character incurred to design, construct, install and implement the
Facility, including, without limitation, all Capitalized Expenses to be provided
by the Lenders, up to but not exceeding $9,400,000, plus all interest and Yield
capitalized pursuant to the Section 3.03(a) and (c) of the Credit Agreement; and
(ii) $12,000,000.
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"FACILITY PLAN": a substantially complete set architectural
and engineering plans and design specifications for the construction,
installation and completion of the Facility and list of Facility Plan documents
designated as SCHEDULE 1.02(A) to the Credit Agreement in the form furnished to
the Lessor and the Agent, and satisfactory to the Lessor, the Agent and the
Lenders, in their sole discretion, as the same may be amended, supplemented or
otherwise modified from time to time with the consent of the Agent.
"FEDERAL FUNDS RATE": for any day, the rate per annum (rounded
upward, if necessary, to the next higher 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day, PROVIDED that (i) if the day for which such rate is to be
determined is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day, and (ii) if
such rate is not so published for any day, the Federal Funds Rate for such day
shall be the average rate charged to the Agent on such day on such transactions,
as determined by the Agent.
"FINAL RENT PAYMENT": an amount determined as of the date
payment thereof is required equal to the sum of (i) the aggregate outstanding
principal amount of the Tranche A Loans, PLUS (ii) all accrued and unpaid fees
and interest on the Tranche A Loans and Tranche B Loans accrued through the end
of the Lease Term, PLUS (iii) all unpaid Yield (including, without limitation,
all Accrued Construction Term Yield) accrued through the end of the Lease Term,
PLUS (iv) all other amounts owing by the Lessee or the Company under the
Transaction Documents (including in any event all unpaid Impositions accrued,
arising or payable in connection with the Facility or otherwise pursuant to the
Lease through or as at the end of the Lease Term, but excluding in any event the
unpaid principal amount of the Tranche B Loans and the Lessor Investment).
"FINANCIAL STATEMENTS DATE": December 31, 1996.
"FISCAL QUARTER": any fiscal quarter of the Company.
"FIXED CHARGES" shall mean, for any fiscal period, the sum of
(i) the amount of the scheduled installments of principal payable in respect of
Indebtedness of the Company and its Subsidiaries during such period, plus (ii)
Interest Expense for such period, plus (iii) the tax provision of the Company
and its Subsidiaries paid or required to be paid in cash for such period, plus
(iv) rental payments, plus (v) Capital Expenditures made by the Company and its
Subsidiaries during such period, plus (vi) any distribution of cash by the
Company to the holders of shares of capital stock of the Company other than the
distribution of cash in the aggregate amount of $700,000 to Carlos A. Saladrigas
and Jose M. Sanchez during May of 1996.
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"FISCAL YEAR": any fiscal year of the Company.
"FLEET": Fleet National Bank, a national banking association,
in its individual capacity, and its successors.
"FUNDED AMOUNT": the aggregate amount of principal, interest,
expenses and indemnities owing or to be owing by the Lessor to the Lenders, plus
the aggregate amount of the Lessor Investment, Yield (including all Yield and
Accrued Construction Term Yield), and all other amounts owing by the Lessor to
the Agent or the Lenders or the Lessor pursuant to the Credit Agreement or any
other Transaction Document.
"GAAP": generally accepted accounting principles in the United
States of America applied on a basis consistent with those which, in accordance
with Section 1.03 of the Credit Agreement, are to be used in making the
calculations for purposes of determining compliance by the Company with the
provisions of the Transaction Documents applicable thereto.
"GOVERNMENTAL APPROVAL": means any authorization, consent,
order, approval, license, lease, ruling, permit, tariff, rate, certification,
validation, exemption, filing or registration by or with, or notice to, any
Governmental Authority.
"GOVERNMENTAL AUTHORITY": to include the country, state,
county, city and political subdivisions in which any Person or any such Person's
property is located or that exercises valid jurisdiction over any such Person or
any such Person's property, and any court, agency, department, commission,
board, bureau or instrumentality of any of them including monetary authorities
that exercise valid jurisdiction over any such Person or any such Person's
property. Unless otherwise specified, all references to Governmental Authority
herein shall mean a Governmental Authority having jurisdiction over, where
applicable, the Company, the Guarantors, the Site, the Facility, the Lessor, the
Agent, any Lender, any Applicable Funding Office or any Transaction Document.
"GOVERNMENTAL REQUIREMENT": any law, statute, code, ordinance,
order, determination, rule, regulation, judgment, decree, writ, order,
injunction, franchise, permit, certificate, license, authorization or other
direction or requirement (whether or not having the force of law), including,
without limitation, Environmental Requirements, and occupational, safety and
health standards or controls, of any Governmental Authority.
"GUARANTEE": with respect to any Person, any obligation,
contingent or otherwise, of such Person directly or indirectly guaranteeing any
Indebtedness or other obligation of any other Person and, without limiting the
generality of the foregoing, any obligation, direct or indirect, contingent or
otherwise, of such Person (i) to secure, purchase or pay (or advance or supply
funds for the purchase or payment of) such
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Indebtedness or other obligation of such other Person (whether arising by virtue
of partnership arrangements, by agreement to keep-well, to purchase assets,
goods, securities or services, to provide collateral security, to take-or-pay,
or to maintain financial statement conditions or otherwise) or (ii) entered into
for the purpose of assuring in any other manner the obligee of such Indebtedness
or other obligation of the payment thereof or to protect such obligee against
loss in respect thereof (in whole or in part), PROVIDED that the term Guarantee
shall not include endorsements for collection or deposit in the ordinary course
of business. The term "Guarantee" used as a verb has a corresponding meaning.
"GUARANTORS": any one or more or all of the following, as the
context shall require: (i) Vincam Human Resources, Inc.; Vincam Human Resources,
Inc. I; Vincam Human Resources, Inc. II; Vincam Human Resources, Inc. III;
Vincam Human Resources, Inc. IV; Vincam Human Resources, Inc. V; Vincam Human
Resources, Inc. VI; Vincam Human Resources, Inc. XII; Vincam Human Resources of
Michigan, Inc.; Vincam Occupational Health Systems, Inc.; Personnel Resources,
Inc.; Vincam Insurance Services, Inc.; Vincam Practice Management, Inc.;
American Pediatric Systems, Inc.; and Psych/Care, Inc., each of which is a
Florida corporation (collectively, the "Florida Subsidiary Guarantors");
Vincam/Staff Administrators, Inc. (d/b/a Staff Administrators, Inc.),
Vincam/Staff Administrators of Western Colorado, Inc. (d/b/a Staff
Administrators of Western Colorado, Inc.); Staff Administrators of CO, Inc., and
Staff Administrators of California, Inc., each of which is a Colorado
corporation; Vincam/Amstaff, Inc., RDM, Inc., Amstaff PEO, Inc., American
Staffing, Inc., Addison, Inc., Amstaff Professional Services, Inc., Amstaff H.r.
Services, Inc., Amstaff Management Services, Inc., Amstaff H.R.M., Inc., A.E.
Service Group, Inc., Staff Resource Services, Inc., Amstaff Employer Resources,
Inc., Amstaff PCS, Inc., Staffing Group Enterprises, Inc., A.M. Risk Management
Company, and ATCO PEO, Inc., each of which is a Michigan corporation; and
Vincam/Staffing Network, Inc., a New Hampshire corporation; and (ii) any
Subsidiary which becomes a Guarantor pursuant to Section 8.33 of the Credit
Agreement.
"GUARANTY (LESSEE)": the Guaranty (Lessee), of even date with
the Credit Agreement, in substantially the form of EXHIBIT I to the Credit
Agreement, from the Guarantors to the Lessor and the Agent for the benefit of
the Lessor, the Agent and the Lenders, pursuant to which the Guarantors, as
primary obligors, jointly and severally guarantee and are liable for all of the
Lessee's obligations under all Transaction Documents, as amended, supplemented
or otherwise modified from time to time.
"GUARANTY (LESSOR)": the Guaranty (Lessor), of even date with
the Credit Agreement, from the Company to the Agent for the benefit of the Agent
and the Lenders, pursuant to which the Company guarantees, as primary obligor,
all obligations of (but in no event obligations greater than those of) the
Lessor to the
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Agent and the Lenders under the Credit Agreement and the Notes (except for
payment of the principal amount of the Tranche B Loans), as amended,
supplemented or otherwise modified from time to time.
"HAZARDOUS MATERIALS": to include, without limitation, (i)
solid or hazardous waste, as defined in the Resource Conservation and Recovery
Act of 1980, 42 U.S.C. ss. 6901 et seq. and its implementing regulations and
amendments, or in any applicable state or local law or regulation, (ii)
"hazardous substance", "pollutant", or "contaminant" as defined in CERCLA, or in
any applicable federal, state or local law or regulation, (iii) gasoline, or any
other petroleum product or by-product, including, crude oil or any fraction
thereof, (iv) insecticides, fungicides, or rodenticides, as defined in the
Federal Insecticide, Fungicide, and Rodenticide Act of 1975, or in any
applicable federal, state or local law or regulation, as each such Act, statute
or regulation may be amended from time to time, or (v) any toxic or hazardous
materials, wastes, polychlorinated biphenyls ("PCBs"), lead-containing
materials, asbestos or asbestos-containing materials, urea formaldehyde,
radioactive materials, pesticides, the discharge of sewage or effluent, or any
other materials or substances defined as or included in the definition of
"hazardous materials," "hazardous waste," "contaminants" or similar terms under
any Environmental Requirement.
"HIGHEST LAWFUL RATE": with respect to each Lender and the
Lessor, the maximum non-usurious interest rate or Yield, as applicable, if any,
that at any time or from time to time may be contracted for, taken, reserved,
charged or received on the Notes, on the Lessor Investment or on other amounts
owing hereunder under laws applicable to such Lender and the Lessor which are
presently in effect or, to the extent allowed by law, under such applicable laws
which may hereafter be in effect and which allow a higher maximum non-usurious
interest rate than applicable laws now allow.
"IMPOSITIONS": without duplication, as to any Person, (i) all
Taxes, assessments, levies, fees, water and sewer rents and charges, inspection
fees and other authorization fees and all other governmental charges, general
and special, ordinary and extraordinary, foreseen and unforeseen, of every
character (including all penalties and interest thereon) that, at any time prior
or subsequent to the Closing Date, are imposed or levied upon or assessed
against or may be or constitute a Lien upon such Person or such Person's
Property, or that arise in respect of the ownership, operation, occupancy,
possession, use, non-use, condition, leasing or subleasing of such Person's
Property; (ii) all charges, levies, fees, rents or assessments for or in respect
of utilities, communications and other services rendered or used on or about
such Person's Property; (iii) payments required in lieu of any of the foregoing;
but excluding any penalties or fines imposed on the Lessor, the Agent or any
Lender, respectively, for violation by it of any banking laws or
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securities law; and (iv) any and all taxes, recording fees and other charges
(including penalties and interest) relating to or arising out of the execution,
delivery or recording of any of the Transaction Documents for the amounts
evidenced, secured or referred to be paid thereby, including without limitation,
documentary stamp taxes, intangible taxes, recording fees and sales, use
transfer, franchise and rent taxes.
"INDEBTEDNESS": of any Person at any date shall mean, (a) all
indebtedness of such Person for borrowed money or for the deferred purchase
price of property or services (excluding current trade liabilities incurred in
the ordinary course of business and payable in accordance with customary
practices, but including any class of capital stock of such Person with fixed
payment obligations or with redemption at the option of the holder), or which is
evidenced by a note, bond, debenture or similar instrument, (b) all obligations
of such Person under leases that should be treated as capitalized leases in
accordance with GAAP, (c) all obligations of such Person in respect of
acceptances issued or created for the account of such Person, and all
reimbursement obligations (contingent or otherwise) of such Person in respect of
any letters of credit issued for the account of such Person to the extent not
secured by cash and without duplication of any underlying Indebtedness, (d) 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 (e) without duplication, all Guarantees.
"INDEMNIFIED PARTY": as defined in Section 11.03(b) of the
Credit Agreement.
"INDEMNIFIED RISKS": as defined in Section 11.03(b) of the
Credit Agreement.
"INITIAL FUNDING DATE": the Closing Date, or such later date
on which the conditions precedent set forth in Sections 6.01 and 6.02 of the
Credit Agreement have been satisfied.
"INITIAL LOANS": the initial Loans made pursuant to Section
2.01 of the Credit Agreement on or after the Initial Funding Date.
"INSURANCE REQUIREMENTS": means the requirements set
forth in Section 14 of and SCHEDULE 14 to the Lease.
"INTELLECTUAL PROPERTY": as defined in Section 7.01(t)
of the Credit Agreement.
"INTEREST EXPENSE": for any fiscal period, the sum (determined
without duplication) of the aggregate amount of interest required to be paid in
cash during such period on Indebtedness of the Company and its Subsidiaries (on
a consolidated basis), including the interest portion of payments under Capital
Lease Obligations and any capitalized interest.
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"INTEREST PERIOD": with respect to each Loan, the period
beginning on the date of such Loan and ending on the numerically corresponding
date (or, if applicable, last calendar date) three months thereafter and,
thereafter, each subsequent period commencing on the last day of the immediately
preceding Interest Period and ending on the numerically corresponding date (or,
if applicable, last calendar date) three months thereafter; PROVIDED, HOWEVER,
that:
(i) the duration of any Interest Period that commences before
the Scheduled Lease Termination Date and would otherwise end after the
Scheduled Lease Termination Date shall end on the Scheduled Lease
Termination Date;
(ii) the duration of the initial Interest Period with respect
to each Loan shall end on the first Quarterly Date occurring after the
date of such Loan; and
(iii) if the last day of such Interest Period would otherwise
occur on a day that is not a Business Day, such last day shall be
extended to the next succeeding Business Day, EXCEPT if such extension
would cause such last day to occur in a new calendar month, then such
last day shall occur on the next preceding Business Day.
"INVESTMENTS": means, with respect to any Person (the
"Investor" ), any investment by the Investor in any other Person, whether by
means of share purchase, capital contribution, purchase or other acquisition of
a partnership or joint venture interest, loan, time deposit, demand deposit or
otherwise.
"JUDGMENT": any judgment, decree, writ, order, determination,
injunction, rule or other direction or requirement of any arbitrator or any
court, tribunal or other Governmental Authority.
"LEASE": the Lease Agreement, of even date with the Credit
Agreement, as amended, supplemented or otherwise modified from time to time,
pursuant to which the Company, as Lessee, has agreed to lease the Facility on
and after the Lease Commencement Date for the Permitted Use in accordance with
the terms and conditions set forth in the Lease.
"LEASE COMMENCEMENT DATE": the Closing Date.
"LEASE TERM": the period of time commencing on the Lease
Commencement Date and ending on the earlier to occur of the (i) the Option Date,
(ii) the Cancellation Date and (iii) the Lease Termination Date.
"LEASE TERMINATION DATE": the earlier to occur of (i) the
fifth (5th) Business day following the date the Construction Term expires if a
Non-Completion Event has occurred or the Basic Term does not commence upon the
expiration of the Construction Term for any reason, (ii) the Scheduled Lease
Termination Date or
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(iii) the fifth (5th) Business Day following the declaration by the Agent and/or
the Lessor of an Event of Default pursuant to Section 15(a)(i)(b) of the Lease.
"LENDER": any Person who from time to time is or becomes a
Tranche A Lender or a Tranche B Lender; collectively, the "LENDERS".
"LESSEE": the Company in its capacity as Lessee under the
Lease and any successor or permitted assign in such capacity.
"LESSOR": Fleet Real Estate, Inc. and any successor permitted
by the terms of the Credit Agreement and the Lease.
"LESSOR INVESTMENT": the aggregate outstanding amount from
time to time of the Lessor Investment Payments made by the Lessor.
"LESSOR INVESTMENT COMMITMENT": as to the Lessor, its
commitment to make Lessor Investments in an amount equal to the Lessor
Investment Commitment then in effect as set forth on EXHIBIT E to the Credit
Agreement.
"LESSOR INVESTMENT PAYMENT": an advance in respect of the
Lessor Investment to be made by the Lessor pursuant to Section 2.01(b) of the
Credit Agreement.
"LESSOR MORTGAGE": the Mortgage, Assignment of Leases and
Security Agreement executed by the Lessor and delivered to the Agent, for the
benefit of the Agent and the Lenders, as amended, supplemented, or otherwise
modified from time to time.
"LIBO RATE": with respect to any Loan for the applicable
Interest Period therefor or any Lessor Investment Payment or the Lessor
Investment, as the case may be, for the applicable Yield Period therefor, or any
other amount, (a) the rate per annum determined on the basis of the offered rate
for deposits of three months in Dollars of amounts equal or comparable to the
principal amount of such Loan or the amount of such Lessor Investment Payment or
the Lessor Investment, as the case may be, or any such other amount, as
applicable, which rates appear on Telerate Page 3750 as of 11:00 A.M., London
time, two Business Days prior to the first day of such Interest Period, PROVIDED
that it will be the arithmetic average (rounded upward, if necessary, to the
next higher 1/16th of 1%) of such offered rates; (b) if no such offered rates
appear on such page, the "LIBO Rate" for such Interest Period or Yield Period,
as applicable, will be the arithmetic average (rounded upward, if necessary, to
the next higher 1/16th of 1%) of rates quoted by not less than two major banks
in New York City, selected by the Agent, at approximately 10:00 A.M., New York
City time, two Business Days prior to the first day of such Interest Period or
Yield Period, as applicable, for deposits in Dollars offered to leading European
banks for a period comparable to such Interest Period or Yield Period, as
applicable, in an amount comparable to
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the principal amount of such Loan or the amount of the Lessor Investment, as the
case may be, or any such other amount.
"LIEN": with respect to any asset, any mortgage, deed to
secure debt, deed of trust, lien, pledge, charge, security interest, security
title, preferential arrangement which has the practical effect of constituting a
security interest or encumbrance, or encumbrance or servitude of any kind in
respect of such asset to secure or assure payment of a Indebtedness or a
Guarantee, whether by consensual agreement or by operation of statute or other
law, or by any agreement, contingent or otherwise, to provide any of the
foregoing. For the purposes of this definition, each of the Company and any
Subsidiary thereof shall be deemed to own subject to a Lien any asset which it
has acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
relating to such asset.
"LOAN": any Tranche A Loan or Tranche B Loan made by the
Lenders pursuant to Section 2.01(a) of the Credit Agreement; the Tranche A Loans
and/or Tranche B Loans; collectively, as the context shall require, "LOANS."
"LOAN COMMITMENT": as to each Lender, an amount equal to the
sum of such Lender's Tranche A Loan Commitment and Tranche B Loan Commitment
then in effect.
"LOAN PERCENTAGE SHARE": as to each Lender, the percentage of
the Tranche A Loans and/or Tranche B Loans and the Tranche A Loan Commitment
and/or Tranche B Loan Commitment, as applicable, to be provided by such Lender
under the Credit Agreement as indicated on EXHIBIT G to the Credit Agreement, as
modified from time to time to reflect any assignments permitted by Section
11.06(b) of the Credit Agreement.
"LOSS EVENT": any of the following events in respect of the
Facility: (i) the total loss of the Facility or the total loss of use thereof
due to destruction, damage beyond repair or rendition of the Facility
permanently unfit for normal use for any reason whatsoever; (ii) any damage to
the Facility which results in an insurance settlement with respect to the
Facility on the basis of a total loss; (iii) the permanent condemnation,
confiscation or seizure of, or requisition of title to or use of, all or
substantially all of the Facility including, but not limited to, a permanent
taking by eminent domain of such scope that the untaken portion of the Facility
is insufficient to permit the restoration of the Facility for continued use in
the Company's business or that causes the remaining portion of the Facility to
be incapable of being restored to a condition that would permit the remaining
portion of the Facility (without the portion of the Facility taken by eminent
domain) to continue to have the capacity and functional ability to perform on a
continuing basis (subject to normal interruptions in the ordinary course of
business for maintenance, inspection, service, repair and testing) and in
commercial operation, the function for which
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the Facility (as a whole) was designed as specified in the Facility Plan or a
temporary taking of such nature for a period exceeding 180 consecutive days; or
(iv) the occurrence of any event or the discovery of any condition in, on,
beneath or involving the Facility or any portion thereof (including, but not
limited to the presence of hazardous substances or the violation of any
applicable Environmental Requirement) that would have a material adverse effect
on the use, occupancy, possession, condition, value or operation of the Facility
or any portion thereof, which event or condition requires remediation (A) the
cost of which is anticipated, in the opinion of the Agent, in consultation with
an independent environmental engineering firm, to exceed 25% of the Termination
Value, and (B) that could not reasonably be expected to be completed
substantially in its entirety prior to the date that is 30 days prior to the
then-applicable Scheduled Lease Termination Date or is not actually completed
substantially in its entirety on or before the date that is 30 days prior to the
then-applicable Scheduled Lease Termination Date.
"MAJORITY LENDERS": at any time while no Loans are
outstanding, Lenders having at least fifty-one percent (51%) of the amount of
the Aggregate Loan Commitments and, at any time while Loans are outstanding,
Lenders holding at least fifty-one percent (51%) of the outstanding aggregate
principal amount of the Loans (without regard to any sale by a Lender of a
participation in any Loan under Section 11.06(f) of the Credit Agreement).
"MARGIN STOCK": "margin stock" as defined in Regulations U or
G of the Board of Governors of the Federal Reserve System, as in effect from
time to time.
"MARKET VALUE": as defined in Section 323.2(f) of the
Regulations and Statements of General Policy on Appraisals promulgated by the
Federal Deposit Insurance Corporation, 12 C.F.R. ss. 323.2(f), as amended from
time to time.
"MATERIAL ADVERSE EFFECT": with respect to any event, act,
condition or occurrence of whatever nature (including any adverse determination
in any litigation, arbitration, or governmental investigation or proceeding),
whether singly or in conjunction with any other event or events, act or acts,
condition or conditions, occurrence or occurrences, whether or not related, a
material adverse change in, or a material adverse effect upon, any of (i) the
financial condition, operations, business, or properties of the Company and its
Consolidated Subsidiaries taken as a whole, (ii) the rights and remedies of the
Agent or the Lenders under the Transaction Documents, or the ability of the
Lessor, the Company or any of the Guarantors to perform its respective
obligations under the Transaction Documents to which it is a party, as
applicable, (iii) the legality, validity or enforceability of any Transaction
Document, or (iv) the use, occupancy, possession, condition, value or operation
of the Facility.
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"MATURITY DATE": the earlier of (a) the Completion Date, in
the event the Basic Term does not commence for any reason, or (b) following the
commencement of the Basic Term, the earlier to occur of (i) the Option Date,
(ii) the Cancellation Date, or (iii) the Lease Termination Date.
"MULTIEMPLOYER PLAN": has the meaning set forth in Section
4001(a)(3) of ERISA.
"NET INCOME" or "NET LOSS" for any period in respect of which
the amount thereof shall be determined, shall mean the aggregate of the
consolidated net income (or net loss) after taxes for such period of the Company
and its Subsidiaries, determined in accordance with GAAP.
"NET WORTH" shall mean, at any date as of which the amount
thereof is to be determined, all assets that should, in accordance with GAAP, be
classified as assets on the consolidated balance sheet of the Company and its
Subsidiaries, MINUS total liabilities of the Company and its Subsidiaries
(determined on a consolidated basis in accordance with GAAP) at such date.
"NON-COMPLETION EVENT": the failure of both (i) Completion and
(ii) the commencement of the Basic Term to occur on or before the date that is
twelve (12) months after the Lease Commencement Date.
"NON-U.S. DOMESTIC LENDER": as defined in Section 4.06(b) of
the Credit Agreement.
"NOTES": collectively, the Tranche A Notes and the Tranche B
Notes.
"OPERATING PROFITS": as applied to any Person for any period,
the operating income of such Person for such period, as determined in accordance
with GAAP.
"OPERATIVE GUARANTIES": collectively (i) the Guaranty (Lessee)
and (ii) the Guaranty (Lessor).
"OPTION DATE": as defined in Section 15(c) of the Lease.
"OTHER TAXES": all taxes (other than Taxes), assessments,
levies, fees, water and sewer rents and charges, inspection fees and other
authorization fees and all other governmental charges, general and special,
ordinary and extraordinary, foreseen and unforeseen, of every character
(including all penalties and interest thereon) and all recording fees and other
charges (including penalties and interest) relating to or arising out of (i) the
execution, delivery, recording or enforcement of any of the Transaction
Documents, whether for the amounts evidenced, secured or referred to be paid
thereby, or otherwise, or (ii) to the ownership, use, operation or transfer of
the Facility or any other Property or (iii) any other event or circumstance,
including without limitation,
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transfer taxes, documentary stamp taxes, intangible taxes, recording fees and
sales, use and rent taxes.
"OTHER TRANSACTION EXPENSES": as defined in Section 3.05(a)(1)
of the Credit Agreement.
"PBGC": the Pension Benefit Guaranty Corporation or any
successor thereto.
"PERMIT": any approval, consent, waiver, exemption, variance,
franchise, order, permit, authorization, right or license of or from any
Governmental Authority or other Person.
"PERMITTED ACQUISITION": an acquisition which satisfies the
following requirements: (A) if it involves a merger or consolidation, upon the
consummation of such merger or consolidation, the surviving party shall be the
Company or a Subsidiary of the Company; (B) at the time of such acquisition and
after giving effect thereto no Event of Default shall have occurred and be
continuing; and (C) the additional following conditions set forth below shall
have been satisfied with respect to the proposed acquisition:
(a) The following additional conditions must be satisfied with
respect to each Permitted Acquisition:
(i) Any company, business or Person to be
acquired shall be engaged primarily in the
same or a related line of business to the
then current business conducted by the
Company and shall have Adjusted EBITDA, with
adjustments reasonably acceptable to the
Agent for the twelve months immediately
preceding the proposed acquisition dates,
greater than $1.00; provided that in the case
of an asset acquisition such determination of
the Adjusted EBITDA in respect of such assets
shall be made on a proforma basis as if such
assets and related liabilities were assets
and related liabilities belonging to a Person
to be acquired by the Company;
(ii) The Company shall have demonstrated, to the
reasonable satisfaction of the Agent, that on
a pro forma basis and after giving effect to
the proposed acquisition, the Company will be
in compliance with the financial covenants
set forth in Sections 8.20 through 8.24,
inclusive.
(iii) All necessary consents, approvals, licenses,
permissions, registrations or validations of any
Governmental Authority or any Person required for the
consummation of the proposed
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acquisition shall have been obtained and
shall be in full force and effect;
(iv) Prior written consent of all of the Agent,
the Lessor and the Lenders (any request for
such consent to be acted upon by such parties
within five Business Days after their receipt
of such request, together with the other
materials and information referenced herein)
shall have been obtained with respect to: (A)
any individual acquisition involving cash
consideration (including assumption of any
Indebtedness, or the issuance of any Seller
Debt) in excess of $10,000,000 or total
consideration in excess of $25,000,000, and
(B) any proposed acquisition during any
fiscal year of the Company to the extent that
the aggregate cash consideration paid by the
Company (including assumption of any
Indebtedness, or the issuance of any Seller
Debt) for acquisitions completed during such
fiscal year exceeds $20,000,000 (taking into
account the proposed acquisition), unless
such proposed acquisition involves less than
$1,000,000 in cash consideration (including
assumption of any Indebtedness, or the
issuance of any Seller Debt);
(v) The provisions of Section 8.33 of the Credit
Agreement have been complied with, where
applicable; and
(vi) The Agent and its counsel shall have
received copies of the acquisition agreement
and such other documents and information
relating to the proposed acquisition as the
Agent or its counsel may reasonably request.
"PERMITTED LIENS": (i) with respect to the Lease or the
Facility (including without limitation, the Site) or any Property included in or
comprising the Facility or any portion thereof, any of the following:
(a) rights reserved to or vested in any Governmental Authority
by the terms of any right, power, franchise, grant, license, permit or
provision of law affecting the Facility to (1) terminate, or take any
other action which has the effect of modifying, such right, power,
franchise, grant, license, permit or provision of law, PROVIDED that
such termination or other action, when taken, shall not have resulted
in a Loss Event and shall not have had a Material Adverse Effect, or
(2) purchase, condemn, appropriate or recapture, or designate a
purchaser of, the Facility;
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(b) any Liens thereon for Impositions or Taxes and any Liens
of mechanics, materialmen and laborers for work or services performed
or materials furnished which (1) are not overdue, or (ii) are being
contested in good faith in the manner described in Section 13 of the
Lease;
(c) Liens of mechanics, materialmen and laborers for work or
services performed or materials furnished (1) existing during the
Construction Term and (2) in an aggregate amount not to exceed $50,000
at any time;
(d) rights reserved to or vested in any Governmental Authority
to control or regulate the use of such Property or to use the Facility
in any manner;
(e) in the case of the Site, encumbrances, easements, and
other similar rights existing on the Closing Date the existence or
exercise of which do not have a Material Adverse Effect; and
(f) any Liens created under the Transaction Documents and any
financing statements filed in connection therewith; and
(ii), with respect to any other Property, any of the following:
(a) Liens for taxes, fees, assessments and other governmental
charges not delinquent or being contested in good faith and by proper
proceedings, as to which adequate reserves are maintained on the books
of the Company and the Guarantors in accordance with GAAP;
(b) carriers', warehousemen's, mechanics, materialmen's or
similar liens imposed by law incurred in the ordinary course of
business in respect of obligations not overdue, or being contested in
good faith and by proper proceedings and as to which adequate reserves
with respect thereto are maintained on the books of the Company and the
Guarantors in accordance with GAAP;
(c) pledges or deposits in connection with workers'
compensation, unemployment insurance and other types of social security
legislation;
(d) security deposits made to secure the performance of
leases, licenses and statutory obligations incurred in the ordinary
course of business;
(e) Liens in favor of the Agent for the benefit of the
Lenders;
(f) existing Liens, if any, listed on SCHEDULE A hereto;
PROVIDED that no such Lien is spread to cover any additional property
after the date hereof, and that the
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principal amount of the Indebtedness secured thereby is not
increased, except to the extent permitted by Section 8.18(e)
of the Credit Agreement; and
(g) Liens securing Indebtedness for the purchase price of
property to the extent permitted by Section 8.18(g) of the Credit
Agreement and Liens securing Indebtedness assumed in connection with
Permitted Acquisitions to the extent permitted in Section 8.18(h) of
the Credit Agreement, PROVIDED that (i) each such Lien is given solely
to secure the purchase price of such property or such assumed
Indebtedness, as the case may be, does not extend to any other property
and (ii) in the case of any such purchase money Indebtedness (x) each
such Lien is given at the time of acquisition of such property, and (y)
the Indebtedness secured thereby does not exceed the lesser of the cost
of such property or its fair market value at the time of acquisition.
"PERMITTED USE": with respect to the Facility, the occupation
and use of the Site and the Improvements as a corporate office building in
compliance with all applicable Governmental Requirements and Insurance
Requirements.
"PERSON": an individual, a corporation, a partnership, an
unincorporated association, a trust or any other entity or organization,
including, but not limited to, a government or political subdivision or other
Governmental Authority.
"PLAN": at any time an employee pension benefit plan which is
covered by Title IV of ERISA or subject to the minimum funding standards under
Section 412 of the Code and is either (i) maintained by a member of the
Controlled Group for employees of any member of the Controlled Group or (ii)
maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to which
a member of the Controlled Group is then making or accruing an obligation to
make contributions or has within the preceding 5 plan years made contributions.
"PLEDGE AGREEMENT": collectively, the several Pledge
Agreements executed by the Lessee and Vincam Human Resources, Inc., Vincam Human
Resources of Michigan, Inc., Vincam/Staff Administrators, Inc. (d/b/a Staff
Administrators, Inc.), Vincam/Amstaff, Inc., RDM, Inc., Amstaff PEO, Inc. and
American Staffing, Inc. pursuant to the Revolving Credit Agreement, as each such
Pledge Agreement is amended by the Amendment to Stock Pledge Agreements dated of
even date with the Credit Agreement and delivered to the Agent, as assignee of
the Lessor, granting to the Lessor a first priority security interest in the
shares of capital stock of all of Subsidiaries, on a PARI PASSU basis with the
security interest therein of the "Agent" under the Revolving Credit Agreement,
for the benefit of the "Lenders" thereunder, and subject to the Pledged Stock
Intercreditor Agreement, as amended, supplemented, or otherwise modified from
time to time.
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"PLEDGED STOCK INTERCREDITOR AGREEMENT": the Intercreditor
Agreement between Fleet National Bank, as Agent under the Revolving Credit
Agreement, the Lessor, and the Company and Vincam Human Resources, Inc., Vincam
Human Resources of Michigan, Inc., Vincam/Staff Administrators, Inc. (d/b/a
Staff Administrators, Inc.), Vincam/Amstaff, Inc., RDM, Inc., Amstaff PEO, Inc.
and American Staffing, Inc. pertaining to the security interests in capital
stock of the Subsidiaries pledged pursuant to the Pledge Agreement, as amended,
supplemented, or otherwise modified from time to time.
"PRICING SCHEDULE" means Schedule 1.02(c) to the Credit
Agreement.
"PRIME RATE": that rate of interest so denominated and set by
Fleet Bank from time to time as an interest rate basis for borrowings. The Prime
Rate is but one of several interest rate bases used by Fleet Bank, and is set by
Fleet Bank as a general reference rate of interest, taking into account such
factors as Fleet Bank may deem appropriate, it being understood that many of
Fleet Bank's commercial or other loans are priced in relation to such rate, that
it is not necessarily the lowest or best rate actually charged to any customer
and that Fleet Bank may make various commercial or other loans at rates of
interest having no relationship to such rate.
"PRINCIPAL OFFICE": the principal office of the Agent and
Fleet Bank presently located at 75 State Street, Boston, Massachusetts or any
other office designated by Fleet Bank.
"PROFORMA FINANCIAL STATEMENTS": as defined in Section 7.1(d).
"PROCESS AGENT": as defined in Section 11.14(b) of the Credit
Agreement.
"PROGRESS REPORT": a Progress Report reflecting a comparison
of the actual renovation, construction and development of the Facility through
the date of such Progress Report with the schedule for such renovation,
construction and development set forth in the Facility Plan.
"PROPERTY": any kind of property or asset, whether real,
personal or mixed, or tangible or intangible, and any interest therein.
"PURCHASE CLOSING DATE": as defined in Section 15(e) of the
Lease.
"PURCHASE PRICE": at any time of determination, the sum of (i)
the aggregate outstanding principal amount of the Loans, PLUS (ii) the aggregate
outstanding principal amount of the Lessor Investment; PLUS (iii) all accrued
and unpaid interest and fees on or in respect of the Loans through the Purchase
Closing Date, PLUS (iv) all accrued and unpaid Yield (including,
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without limitation, all Accrued Construction Term Yield) and all accrued and
unpaid fees in respect of the Lessor Investment Commitment, in each case through
the Purchase Closing Date, PLUS (v) all other amounts owing by the Company or
the Guarantors under the Transaction Documents (including in any event all
unpaid Impositions accrued, arising or payable in connection with the Facility
or otherwise pursuant to the Lease whether in connection with the purchase of
the Facility pursuant to Section 14(d) of the Lease or pursuant to any provision
of Section 15 of the Lease, or otherwise).
"QUARTERLY DATES": the last day of each March, June,
September, and December in each year, the first of which shall be December 31,
1997, PROVIDED that if any such day is not a Business Day, then such Quarterly
Date shall be the next Business Day.
"REDEEMABLE PREFERRED STOCK": of any Person means any
preferred stock issued by such Person (i) required (by the terms of the
governing instruments or at the option of the holder thereof) to be mandatorily
redeemed for cash at any time prior to the Maturity Date (by sinking fund or
similar payments or otherwise) or (ii) redeemable at the option of the holder
thereof at any time prior to the Maturity Date.
"REGISTER": as defined in Section 11.06(d) of the Credit
Agreement.
"REGULATION D": Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"REGULATION G": Regulation G of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"REGULATION U": Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"RELATED CONTRACT": any agreement, contract, bill of sale,
receipt or Vendor's warranty relating to or for the purchase, acquisition,
design, engineering, testing, manufacture, renovation, assembly, construction or
installation of the Facility or any portion thereof or the provision of
enhancements and improvements to the Facility, or otherwise in connection with
the acquisition, ownership, use, operation or sale or other disposition of the
Facility, made, entered into or received by the Acquisition/Construction Agent
on behalf of the Lessor pursuant to the Agency Agreement or by the Company and
assigned to the Lessor pursuant to the Agency Agreement, with or from one or
more Vendors or other Persons.
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"RENT": Basic Rent, Supplemental Rent and the Final Rent
Payment, collectively.
"RENT PAYMENT DATE": the last day of any Rental Period.
"RENTAL PERIOD": (i) with respect to each Loan and Loan
Commitment, each Interest Period therefor that ends after the Completion Date,
and (ii) with respect to the Lessor Investment and the Lessor Investment
Commitment, each Yield Period therefor that ends after the Completion Date.
"REQUIRED PERCENTAGE COMPOSITION": (i) with respect to the
Commitments, a requirement that not less than 3% of the aggregate amount of the
Lessor Investment Commitment and the Loan Commitments be comprised of Lessor
Investment Commitment; (ii) with respect to the Construction Term and the Lease
Term, a requirement that not less than 3% of Facility Cost, and not less than 3%
of the amount that is the sum of (a) the aggregate outstanding principal amount
of the Loans and (b) the Lessor Investment, be provided by or comprised of the
Lessor Investment; (iii) with respect to each Borrowing, a requirement that no
more than 85% (rounded) of such Borrowing, and 85% of Facility Cost, shall be
comprised of Tranche A Loans, and no more than 12% (rounded) of such Borrowing,
and 12% of Facility Cost, shall be provided by or comprised of Tranche B Loans;
(iv) with respect to each Borrowing, a requirement that after giving effect
thereto, 3% of the amount that is the sum of (a) the aggregate outstanding
principal amount of the Loans and (b) the Lessor Investment be comprised of the
Lessor Investment; (v) with respect to each Borrowing, a requirement that after
giving effect thereto the aggregate outstanding amount of Loans shall not exceed
the Aggregate Loan Commitments, and after giving effect to the Lessor Investment
Payments, the Lessor Investment shall not exceed the Lessor Investment
Commitment; and (vi) with respect to the Completion Date, a requirement that on
such date, after giving effect to all Lessor Investment Payments and Loans to be
made and outstanding at the close of business on such date, 3% of the amount
that is the sum of (a) the aggregate outstanding principal amount of the Loans
and (b) the Lessor Investment be comprised of the Lessor Investment and 97% of
such sum be comprised of Loans.
"RESPONSIBLE OFFICER" shall mean the Chairman, the President,
or the Chief Financial Officer, Senior Vice President- Finance and
Administration of the Company.
"RESTRICTED INVESTMENT": means any investment in cash or by
delivery of property to any Person, whether by acquisition of stock,
indebtedness or other obligation or security, or by loan, advance or capital
contribution, or otherwise, or in any property except that investments
consisting of the following shall not constitute "Restricted Investments": (i)
property used or to be used in the ordinary course of business; (ii) current
assets arising from the sale of goods or the provision of services in the
ordinary course of business; (iii) loans or
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advances to employees for salary, commissions, travel or the like, made in the
ordinary course of business; (iv) investments in direct obligations of the
United States of America, or any agency thereof or obligations guaranteed by the
United States of America, PROVIDED that such obligations mature within one year
from the date of acquisition thereof; (v) investments in time deposits, demand
deposits and certificates of deposit maturing within one year from the date of
acquisition issued by a bank or trust company organized under the laws of the
United States or any state thereof having capital surplus and undivided profits
aggregating at least $500,000,000; and (vi) investments in commercial paper
given the highest rating by a national credit rating agency and maturing not
more than two hundred seventy (270) days from the date of creation thereof.
"RESTRICTED PAYMENT" shall mean, with respect to the Company
or any Subsidiary thereof, (a) any dividend or other distribution on any shares
of capital stock of the Company or such Subsidiary (except dividends payable
solely to the Company or any Subsidiary and dividends payable solely in stock by
the Company or such Subsidiary), and (b) any payment on account of the purchase,
redemption, retirement or acquisition of (i) any shares of the capital stock of
the Company or a Subsidiary thereof or (ii) any option, warrant, convertible
security or other right to acquire shares of the capital stock of the Company or
a Subsidiary thereof, other than, in either case, payments made solely to the
Company or such Subsidiary.
"RESTORATION ACCOUNT": the interest bearing account maintained
with the Agent by the Lessor pursuant to Section 14(d) of the Lease and styled
the "Restoration Account."
"REVOLVING CREDIT AGREEMENT": the Credit Agreement dated as of
April 24, 1997 among the Company and its Subsidiaries, as Borrowers, Fleet
National Bank, as Agent, and various financial institutions parties thereto from
time to time, as Lenders, as amended or supplemented from time to time.
"SCHEDULED LEASE TERMINATION DATE": the date that is 4 years
after the Completion Date, or such later date to which it may be extended
subject and pursuant to the provisions of Section 2(b) of the Lease.
"SECURITY INSTRUMENTS": collectively, the Lessor Mortgage and
any and all agreements or instruments, including, without limitation, financing
statements, now or hereafter executed and delivered by the Company as security
for the payment or performance of the Notes and the Lessor Investment or the
Credit Agreement, as such agreements or instruments may be amended, supplemented
or otherwise modified from time to time.
"SELLER DEBT": as defined in Section 8.18 of the Credit
Agreement.
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"SITE": certain real property located in Dade County, Florida,
described in greater detail on EXHIBIT A to the Credit Agreement and the Lease.
"STOCKHOLDERS' EQUITY": at any time, the stockholders' equity
of the Company and its Consolidated Subsidiaries, as set forth or reflected on
the most recent consolidated balance sheet of the Company and its Consolidated
Subsidiaries prepared in accordance with GAAP; BUT EXCLUDING any Redeemable
Preferred Stock of the Company or any of its Consolidated Subsidiaries.
Stockholders' Equity generally would include, but not be limited to: (i) the par
or stated value of all outstanding Capital Stock, (ii) capital surplus, (iii)
retained earnings, and (iv) various deductions such as (a) purchases of treasury
stock, (b) valuation allowances, (c) receivables due from an employee stock
ownership plan, (d) employee stock ownership plan debt guarantees and (e)
translation adjustments for foreign currency transactions.
"SUBLEASE RENT": as defined in Section 3(a) of the Lease.
"SUBLESSEE": as defined in Section 21(c) of the Lease.
"SUBORDINATED DEBT": Indebtedness of the Company and the
Guarantors that is subordinated to the obligations of the Company and the
Guarantors owing to the Lenders and the Lessor under the Lease, the Guaranty and
the other Transaction Documents either (a) pursuant to a subordination agreement
in form and substance reasonably satisfactory to the Majority Lenders between
the Lenders (or the Agent) and the holder(s) of such Indebtedness, or (b)
pursuant to the terms thereof, where the Majority Lenders have confirmed in
writing that such terms are reasonably satisfactory to them.
"SUBSIDIARY": any corporation or other entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by the Company.
"SUPPLEMENTAL RENT": as defined in Section 3(d) of the Lease.
"SUPPORT EXPENSES": as defined in Section 3.2(l) of the Agency
Agreement.
"SURVEY": (i) a current ALTA-ACSM boundary survey of the Site
and existing improvements, if any, from a registered surveyor, prior to the
Closing Date, in form and substance satisfactory to the Agent, the Lessor and
the Lenders, in their sole discretion, and containing such certifications as the
Agent may request and (ii) an as-built survey by the original surveyor on, and
as of the Completion Date.
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"TANGIBLE NET WORTH" shall mean, at any date as of which the
amount thereof is to be determined, an amount equal to Net Worth, MINUS (i) the
sum of any amounts attributable to the book value, net of applicable reserves,
of all intangible assets of the Company and its Subsidiaries, including, without
limitation, goodwill, trademarks, copyrights, patents and any similar rights,
and unamortized debt discount and expense, and (ii) intercompany accounts with
Subsidiaries and Affiliates (including receivables due from Subsidiaries and
Affiliates).
"TAXES": as defined in Section 4.06(a) of the Credit
Agreement.
"TERMINATION EVENT": as defined in Section 15(a) of the Lease.
"TERMINATION VALUE": at any time of determination, an amount
equal to the sum of (i) the Final Rent Payment, PLUS (ii) the aggregate
outstanding principal amount of the Tranche B Loans, PLUS (iii) the aggregate
outstanding principal amount of the Lessor Investment, PLUS, (iv) without
duplication of amounts included in the Final Rent Payment, all unpaid
Impositions payable in connection with the purchase of the Facility pursuant to
Section 14(d) of the Lease or pursuant to any provision of Section 15 of the
Lease.
"THIRD PARTY": any Person other than (i) the Lessor, (ii) the
Company, (iii) the Guarantors, or (iv) any Affiliate of any of the foregoing.
"TITLE POLICY: a title insurance policy insuring the Lessor's
title to the Facility (i) as fee owner, subject to an exception for
recharacterization of the Lease as a mortgage, and (ii) as mortgagee, if the
Lease were so characterized and, insuring the Agent's interest as mortgagee of
the Facility under the Lessor Mortgage for the benefit of the Lenders.
"TOTAL FUNDED DEBT" shall mean the following (without
duplication) with respect to the Company and its Subsidiaries: (i) all
indebtedness for borrowed money (other than trade liabilities incurred in the
ordinary course of business and payable in accordance with customary practices);
(ii) all obligations evidenced by bonds, indentures, notes and similar
instruments; (iii) all obligations with respect to letters of credit and other
similar instruments not fully secured by cash other than those letters of credit
issued as security for indebtedness described in subsection (i) but only to the
extent of the maximum amount available to be drawn under such letters of credit;
(iv) all Capital Lease Obligations; (v) all liabilities secured by any Lien on
any property owned by the Company, regardless of whether such liabilities are
nonrecourse; and (vi) all Guaranties (without duplication).
"TRANCHE A LOAN COMMITMENT": as to any Lender, the commitment
of such Lender to make loans pursuant to Section
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2.01(a) of the Credit Agreement in an amount equal to such Lender's Loan
Percentage Share of the Tranche A Loans, as set forth on EXHIBIT E to the Credit
Agreement.
"TRANCHE A LOANS": collectively, all Loans made by the Lenders
to the Lessor pursuant to the Tranche A Loan Commitments in an aggregate
principal amount not to exceed the Aggregate Trance A Loan Commitments.
"TRANCHE A NOTE" and "TRANCHE A NOTES": as defined in Section
2.05(a) of the Credit Agreement.
"TRANCHE A LENDER": any Person who from time to time becomes
or has agreed to become a holder of a Tranche A Note and is a signatory of the
Credit Agreement as a Tranche A Lender or becomes a party thereto as provided in
Section 11.06 thereof, and their respective successors and assigns;
collectively, the "TRANCHE A LENDERS."
"TRANCHE B LOAN COMMITMENT": as to any Lender, the commitment
of such Lender to make loans pursuant to Section 2.01(a) of the Credit Agreement
in an amount equal to such Lender's Loan Percentage Share of the Tranche B
Loans, as set forth on EXHIBIT E to the Credit Agreement.
"TRANCHE B LOANS": collectively, all Loans made by the Lenders
to the Lessor pursuant to the Tranche B Loan Commitments in an aggregate
principal amount not to exceed the Aggregate Tranche B Loan Commitments.
"TRANCHE B NOTE" and "TRANCHE B NOTES": as defined in Section
2.05(b) of the Credit Agreement, as the same may be amended, supplemented,
renewed, extended for any period, increased, rearranged or otherwise modified
from time to time.
"TRANCHE B LENDER": any Person who from time to time becomes
or has agreed to become a holder of a Tranche B Note and is a signatory of the
Credit Agreement as a Tranche B Lender or becomes a party thereto as provided in
Section 11.06 thereof, and their respective successors and assigns;
collectively, the "TRANCHE B LENDERS". successors.
"TRANSACTION DOCUMENTS": collectively, the Credit Agreement,
the Lease, the Agency Agreement, the Operative Guaranties, the Contribution
Agreement, the Notes, the Lessor Mortgage, the Pledge Agreement, the Pledged
Stock Intercreditor Agreement and the other Security Instruments and any and all
other agreements or instruments now or hereafter executed and delivered, or
required to be executed and delivered, by the Lessor, the Company or the
Guarantors in connection with the Notes, the Lease or the Credit Agreement, as
such agreements or instruments may be amended, supplemented, renewed, extended,
increased or otherwise modified from time to time.
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"UCC": the Uniform Commercial Code as in effect in the State
of Florida and any other jurisdiction whose laws may be mandatorily applicable.
"UNGUARANTEED AMOUNT": as of any date of determination, the
aggregate amount of principal then owing by the Lessor to the Lenders on account
of the Tranche B Loans and to the Lessor on account of the Lessor Investment.
"VENDOR": any designer, supplier, manufacturer or installer
of, or provider of Property or services with respect to, the Facility or any
Property included therein or any part thereof.
"WHOLLY OWNED SUBSIDIARY": any Subsidiary all of the shares of
capital stock or other ownership interests of which (except directors'
qualifying shares) are at the time directly or indirectly owned by the Company.
"YIELD": all yield accruing from time to time with respect to
the Lessor Investment of the Lessor, Yield to include without limitation all
Accrued Construction Term Yield.
"YIELD PERIOD": with respect to each Lessor Investment Payment
or the Lessor Investment, as applicable, the period beginning on the date of
such Lessor Investment Payment and ending on the numerically corresponding date
(or, if applicable, last calendar date) three months thereafter and, thereafter,
each subsequent period commencing on the last day of the immediately preceding
Yield Period and ending on the numerically corresponding date (or, if
applicable, last calendar date) three months thereafter, PROVIDED, HOWEVER,
that:
(i) The duration of any Yield Period that commences
before the Scheduled Lease Termination Date and would otherwise end
after the Scheduled Lease Termination Date shall end on the Scheduled
Lease Termination Date;
(ii) the duration of the initial Yield Period with
respect to each Lessor Investment Payment shall end on the first
Quarterly Date occurring after the date of such Lessor Investment
Payment; and
(iii) if the last day of such Yield Period would
otherwise occur on a day that is not a Business Day, such last day
shall be extended to the next succeeding Business Day, EXCEPT if such
extension would cause such last day to occur in a new calendar month,
then such last day shall occur on the next preceding Business Day.
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SCHEDULE 1.02(A)
Facility Plan and List of Facility Plan Documents
[TO BE FURNISHED BY THE COMPANY]
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SCHEDULE 1.02(B)
REQUIREMENTS FOR "COMPLETION"
The term "Completion," as used in the Transaction Documents shall mean
satisfaction of all of the following conditions and requirements:
1. The Company, as Acquisition/Construction Agent, has satisfied all of
its design and construction obligations under Section 1.3 of the Agency
Agreement which are required to be completed by the Completion Date.
2. The Company, as Acquisition/Construction Agent, and the architect
responsible for the Facility Plan shall have executed and delivered to the
Lessor and the Agent the Completion Certificate.
3. A letter of shell completion for the Facility and final,
unconditional certificates of occupancy covering each floor of the Facility
shall have been issued by Dade County, Florida.
4. The Lessor and the Agent shall have received endorsements to the
Title Policy which (a) advance the effective date thereof through the Completion
Date without exception for mechanics' or materialmen's liens or any other
encumbrances other than the Permitted Liens, and (b) evidence payment of all
real property Impositions which are due and payable as of the advanced effective
date.
5. The general contractor shall have executed and delivered for the
benefit of the Lessor a final contractor's affidavit in accordance with the
requirements of applicable Florida law.
6. The Agent and the Lessor shall have received the Survey, delineating
all of the improvements thereon on the Site and dated within thirty (30) days of
the proposed Completion Date.
7. The Company shall have delivered all Applicable Permits and
reasonable evidence satisfactory to the Lessor and the Agent that the Facility
is in compliance with all zoning ordinances, agreements, architectural
restrictions and environmental regulations applicable to the Facility and
reasonable evidence that streets, utilities and municipal services required for
the use and occupancy of the Facility for the Permitted Use are in place,
available and sufficient.
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8. The Company shall have provided the Lessor and the Agent reasonable
evidence that all personal property taxes affecting the Facility or any portion
thereof which have become due and payable have been paid in full.
9. No part of the Facility shall have been subject to any Casualty
Occurrence and then remain unrepaired or unrestored as of the proposed
Completion Date and no actual or threatened proceeding for the taking of all or
less than all of the Facility pursuant to the exercise of the power of eminent
domain shall be pending as of the proposed Completion Date.
10. There shall not have occurred and then be continuing any Event of
Default under any of the Transaction Documents or any event which, with the
giving of notice or the passage of time or both, would constitute an Event of
Default under any of the Transaction Documents.
11. The Company and the Guarantors, as applicable, shall have renewed
in writing any representations and warranties provided in the Transaction
Documents that may reasonably be required by Agent which are applicable to
periods following the Completion Date.
12. No Material Adverse Effect has occurred.
13. To the extent not already provided, the Company shall have provided
the Lessor and the Agent satisfactory deeds, bills of sale, assignments of
purchase orders, Vendor's warranties, and other documentation incident to the
acquisition of the Facility by the Lessor.
14. All filings or recordings considered necessary or desirable by the
Lessor, the Agent and the Lenders completed and all taxes and fees in connection
therewith paid by the Company.
15. The Lessor and the Agent shall have received favorable opinion of
counsel to the Lessee covering such matters incident to the transactions as the
Lessor may require as to documents or legal issues not covered on the Lease
Commencement Date, if any).
16. The Lessor and the Agent shall have received evidence of compliance
with Insurance Requirements.
17. The Lessor and the Agent shall have received such certified
resolutions and incumbency certificates, and such other certificates and
documents as the Lessor, the Agent or the Lenders may reasonably request.
18. All Transaction Documents to be entered into at the Completion Date
are in form and substance satisfactory to the Lessor, the Agent and the Lenders.
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SCHEDULE 1.02(C)
Pricing Schedule
A. The "APPLICABLE TRANCHE A LOAN MARGIN", "APPLICABLE TRANCHE B LOAN
MARGIN" and "APPLICABLE LESSOR'S INVESTMENT MARGIN" with respect to
amounts owing in respect of the Loans and the Lessor's Investment,
respectively, not then due and payable are as determined for amounts
accruing at the Base Rate or the Adjusted LIBO Rate, respectively, by
reference to the table below and the ratio of Total Funded Debt to
Adjusted EBITDA set forth in the most recent Compliance Certificate
furnished to the Agent pursuant to Section 8.01(c) of the Credit
Agreement, for the four consecutive fiscal quarters ending on the
Applicable Financial Statements Date referred to therein, and adjusted
as of the date of receipt by the Agent of such Compliance Certificate:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------
Ratio of Total less than 2.5:1.0 less than 2.0:1.0 less than 1.5:1.0
Funded Debt to but but but less than 1.0:1.0
Adjusted greater than 2.0:1.0 greater than 1.5:1.0 greater than 1.0:1.0
EBITDA
- ---------------------------------------------------------------------------------------------------------------
Base Rate
Applicable
Tranche A Loan 0.25% 0.0% 0.0% 0.0%
Margin and
Applicable
Tranche B Loan
Margin
- ---------------------------------------------------------------------------------------------------------------
Base Rate
Applicable
Lessor's 0.25% 0.0% 0.0% 0.0%
Investment
Margin
- ---------------------------------------------------------------------------------------------------------------
Adjusted LIBO
Rate
Applicable
Tranche A Loan 1.75% 1.50% 1.25% 1.0%
Margin
and
Applicable
Tranche B Loan
Margin
- ---------------------------------------------------------------------------------------------------------------
Adjusted LIBO
Rate
Applicable 2.0% 2.0% 2.0% 2.0%
Lessor's
Investment
Margin
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
-113-
<PAGE>
B. The Applicable Tranche A Loan Margin with respect to any principal
amount of, or accrued unpaid interest on, the Tranche A Loans not paid
when due (whether as part of Final Rent Payment, Termination Value,
Purchase Price, Completion Costs Payment or otherwise) is the sum of
(i) the Applicable Tranche A Loan Margin determined pursuant to A.
above, plus (ii) 2% (the "Default Tranche A Loan Margin").
C. The Applicable Tranche B Loan Margin with respect to any principal
amount of, or accrued unpaid interest on, the Tranche B Loans not paid
when due (whether as part of any Final Rent Payment, Termination Value,
Purchase Price, Completion Costs Payment or otherwise) is the sum of
(i) the Applicable Tranche B Loan Margin determined pursuant to A.
above, plus (ii) 3% (the "Default Tranche B Loan Margin").
D. The Applicable Lessor's Investment Margin with respect to any
unrecovered amount of, or accrued unpaid Yield on or in respect of, the
Lessor's Investment not paid when due (whether as part of any
Termination Value, Purchase Price, Completion Costs Payment or
otherwise) is the sum of (i) the Applicable Lessor's Investment Margin
determined pursuant to A. above, plus (ii) 5% (the "Default Investment
Margin").
-114-
THIS INSTRUMENT PREPARED BY
AND AFTER RECORDING RETURN TO:
Christopher L. Carson, Esq.
Jones, Day, Reavis & Pogue
3500 One Peachtree Center
303 Peachtree Street, N.E.
Atlanta, Georgia 30308-3242
LEASE AGREEMENT
Dated as of December 9, 1997
Between
FLEET REAL ESTATE, INC.,
as the Lessor,
and
THE VINCAM GROUP, INC.,
as the Lessee
- -------------------------------------------------------------------------------
NOTICE TO RECORDER: THIS LEASE AGREEMENT SHALL BE DEEMED (EXCEPT FOR ACCOUNTING
PURPOSES) A MORTGAGE, FIXTURE FINANCING STATEMENT AND SECURITY AGREEMENT BETWEEN
THE LESSEE, THE VINCAM GROUP, INC., AS MORTGAGOR AND DEBTOR, AND THE LESSOR,
FLEET REAL ESTATE, INC., AS MORTGAGEE AND SECURED PARTY SECURING INDEBTEDNESS IN
THE PRINCIPAL AMOUNT OF $360,000.00, AS SET FORTH IN SECTION 26 HEREIN. THE
COLLATERAL SUBJECT TO THE SECURITY INTEREST INCLUDES PERSONAL PROPERTY THAT IS,
OR MAY BECOME, FIXTURES ATTACHED TO THE REAL PROPERTY DESCRIBED IN THIS LEASE
AGREEMENT. THIS LEASE AGREEMENT SHOULD BE FILED AND RECORDED IN THE REAL ESTATE
RECORDS AS A MORTGAGE AND FIXTURE FILING. FLEET REAL ESTATE, INC. SHOULD BE
INDEXED AS THE MORTGAGEE OF THE MORTGAGE AND SECURITY INTEREST. THE VINCAM
GROUP, INC. SHOULD BE INDEXED AS THE MORTGAGOR OF THE MORTGAGE AND SECURITY
INTEREST.
<PAGE>
Addresses of Parties:
Lessor: Lessee:
Fleet Real Estate, Inc. The Vincam Group, Inc.
One Federal Street 2850 Douglas Road
Boston, Massachusetts 02211 Coral Gables, Florida 33135
Attention: Jay Hart Attention: Elizabeth J. Keeler,
General Counsel
THIS LEASE HAS BEEN MANUALLY EXECUTED IN COUNTERPARTS NUMBERED
CONSECUTIVELY FROM 1 TO 2. TO THE EXTENT, IF ANY, THAT THIS LEASE
CONSTITUTES CHATTEL PAPER (AS SUCH TERM IS DEFINED IN THE UNIFORM
COMMERCIAL CODE AS IN EFFECT IN ANY APPLICABLE JURISDICTION), NO
SECURITY INTEREST IN THIS LEASE MAY BE CREATED THROUGH THE TRANSFER OR
POSSESSION OF ANY COUNTERPART OF THIS LEASE OTHER THAN COUNTERPART
NUMBER 1.
This is Counterpart Number _____
<PAGE>
TABLE OF CONTENTS
Page
Section 1. Defined Terms...............................................1
Section 2. Lease of Facility...........................................1
Section 3. Payments....................................................3
Section 4. [ RESERVED ]................................................6
Section 5. Credit Agreement; Agency Agreement..........................6
Section 6. Title to Remain in the Lessor...............................7
Section 7. Maintenance of the Facility; Operations.....................7
Section 8. Modifications...............................................9
Section 9. Further Assurances.........................................10
Section 10. Compliance with Governmental Requirements and
Insurance Requirements: Related Contracts..................10
Section 11. Condition and Use of Facility; Quiet Enjoyment.............11
Section 12. Liens......................................................13
Section 13. Permitted Contests.........................................14
Section 14. Insurance, etc.............................................14
Section 15. Termination; Cancellation; Purchase Option.................17
Section 16. Transfer of Title on Removal of Facility; Expenses
of Transfer................................................20
Section 17. Events of Default and Remedies.............................22
Section 18. Change in the Lessee's Name or Structure...................25
Section 19. Inspection; Right to Enter Premises of the Lessee..........26
Section 20. Right to Perform the Lessee's Covenants....................26
Section 21. Participation by Co-Lessees or Sublessees..................26
i
<PAGE>
TABLE OF CONTENTS
(continued)
Page
Section 22. Notices....................................................28
Section 23. Amendments and Waivers.....................................28
Section 24. Severability...............................................28
Section 25. Federal Income Tax Considerations..........................28
Section 26. Other Provisions...........................................29
Section 27. Miscellaneous..............................................33
EXHIBITS
Exhibit A Description of Site
SCHEDULES
Schedule 1 Insurance Schedule
ii
<PAGE>
LEASE AGREEMENT
This Lease Agreement dated as of December 9, 1997, (as the same may be
amended, modified or supplemented from time to time, this "LEASE") is between
FLEET REAL ESTATE, INC., a Rhode Island corporation (together with its
successors and permitted assigns, the "LESSOR"), and THE VINCAM GROUP, INC., a
Florida corporation (together with its successors and permitted assigns, the
"LESSEE").
RECITALS
WHEREAS, Lessor has acquired certain real property in Dade
County, Florida, described in greater detail on Exhibit A (the "SITE"), and all
appurtenances thereto and has entered into certain agreements described in
greater detail in that certain Credit and Investment Agreement bearing even date
herewith entered into by and among Lessor, Lessee, Fleet National Bank, as Agent
and certain other parties (the "CREDIT AGREEMENT") to construct certain
improvements on the Site in accordance with the Facility Plan in order to create
a corporate headquarters facility together with related enhancements and
improvements in accordance with the Facility Plan; and
WHEREAS, subject to the terms and conditions of this Lease,
the Lessee desires to lease from the Lessor the Site and such enhancements and
improvements beginning on the Lease Commencement Date for the purpose of
occupying and using the Site and such enhancements and improvements as a
corporate headquarters facility in accordance with the terms and conditions set
forth in this Lease.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Lessor and the Lessee agree as follows:
Section 1. DEFINED TERMS. All capitalized terms used in this
Lease, and not otherwise defined herein shall have the meanings assigned such
terms in Schedule 1.02 to the Credit Agreement, which Schedule 1.02 is
incorporated by reference.
Section 2. LEASE OF FACILITY.
(a) During the term of and subject to the terms and conditions
of this Lease, the Lessor hereby leases to the Lessee, and the Lessee hereby
leases from the Lessor, the Facility for the Lease Term to be occupied and used
(i) to cause Completion of the Facility during the portion of the Lease Term
surviving the Construction Term in accordance with the Agency Agreement and (ii)
1
<PAGE>
for and only for the Permitted Use with respect to the Basic Term. The entire
Facility shall become subject to this Lease as of the effective date hereof;
provided that the Lessor will deliver possession of the Facility to Lessee for
occupancy and operation in accordance with the Permitted Use in conjunction with
and to the extent permitted by certificates of occupancy issued by the
applicable Governmental Authority.
(b) Unless earlier terminated in accordance with the other
provisions hereof, including without limitation, Sections 15 and 17, this Lease
shall terminate on the Scheduled Lease Termination Date. If, but only if, (i)
the Maturity Date of the Loans and Lessor Investment shall have been extended
pursuant to Section 2.09 of the Credit Agreement to the extended Scheduled Lease
Termination Date proposed by the Lessee as provided herein, and (ii) the Lessee,
on any day that is not less than twelve (12) months and no more than eighteen
(18) months prior to the Scheduled Lease Termination Date shall have requested
in writing to the Lessor and the Agent the extension of the Scheduled Lease
Termination Date for up to three (3) years expiring on or before the three (3)
year anniversary of the original Scheduled Lease Termination Date, then the
Lessor shall consent to such extension in writing and the Scheduled Lease
Termination Date shall be extended to the date requested by the Lessee which
date shall be on or prior to (as requested by the Lessee) the three (3) year
anniversary of the original Scheduled Lease Termination Date. Any such extension
shall be effective upon the execution of documentation evidencing the same
(which the Lessor agrees to execute promptly upon request of the Lessee if the
Lessor's consent to such extension is to be given pursuant hereto), and
containing such additional terms as the Agent, acting in its reasonable
discretion, may require; provided that no such documentation or additional terms
shall impose any additional liability on Lessor.
In the event it is determined at any time that the term of this Lease
will not be extended beyond the original Scheduled Lease Termination Date, or if
a Non-Completion Event occurs, the Lessee shall give to the Lessor and the Agent
written notice as provided below specifying which of the options under Section
15(a)(ii) of this Lease the Lessee intends to exercise upon the applicable Lease
Termination Date:
(x) if the Scheduled Lease Termination Date is not to be
extended because the Agent or any Lender(or assignee thereof) or Lessor
has refused or is deemed to have refused the Lessee's request for
extension, then the Lessee shall give the Lessor notice within thirty
(30) days of the earlier to occur of (A) the date the Lessee receives
written notice of said refusal or (B) the date of such deemed refusal
pursuant to Section 2.10 of the Credit Agreement;
2
<PAGE>
(y) if the Scheduled Lease Termination Date is not to be
extended because the Lessee chooses not to request such extension, the
Lessee shall give the Lessor notice on any date that is not less than
twelve (12) months and no more than eighteen (18) months prior to the
then current Scheduled Lease Termination Date; and
(z) if a Non-Completion Event occurs, the Lessee shall give
the Lessor notice within five (5) Business Days of the date of the
Non-Completion Event.
In the event the Lessee fails to give timely written notice to the
Lessor on or before the dates herein provided, the Lessee shall be deemed to
have elected to purchase the Facility on the Lease Termination Date for the
Purchase Price.
Section 3. PAYMENTS.
(a) The Lessee shall pay to the Lessor on the Rent Payment
Date for each Rental Period the amount of Basic Rent due for such Rental Period.
(b) On the earlier to occur of the Lease Termination Date, the
Cancellation Date or the Option Date, Lessee shall pay to Lessor the Final Rent
Payment (or, if a Non-Completion Event has occurred, the Completion Costs
Payment).
(c) In addition to Basic Rent and the Final Rent Payment (or
the Completion Costs Payment, if applicable), the Lessee will also pay to the
Lessor, from time to time, quarterly upon demand by the Lessor or the Agent (or
at such more frequent times as they may deem appropriate in the circumstances),
as additional rent ("SUPPLEMENTAL RENT") the following (but without duplication
of any amounts included in the calculation of Rent):
(i) a fee payable to the Agent in the amount of $500 per month
or portion thereof, payable quarterly in advance on the first day of
each quarter for and during the Construction Period; all out-of-pocket
costs and expenses reasonably incurred by the Lessor or the Agent in
connection with the preparation, negotiation, execution, delivery,
performance and administration of this Lease and the other Transaction
Documents, including, but not limited to, the following: (A) fees and
expenses of the Lessor and the Agent, including, without limitation,
reasonable attorneys' fees and expenses; (B) all other amounts,
including, without limitation, fees, indemnities, expenses,
compensation in respect of increased costs of any kind or description
payable under the Credit Agreement or any other Transaction Document;
(C) all yield maintenance, capital adequacy and other costs
contemplated under Article V of the Credit Agreement, and (D) all
3
<PAGE>
out-of-pocket costs and expenses incurred by the Lessor or the Agent
(and, in the case of clause (z) below, any Lender) after the date of
this Lease (including, without limitation, reasonable attorneys' fees
and expenses and other expenses and disbursements reasonably incurred)
associated with (x) negotiating and entering into, or the giving or
withholding of, any future amendments, supplements, waivers or consents
with respect to this Lease; (y) any Loss Event, Casualty Occurrence or
termination of this Lease; and (z) any Default or Event of Default and
the enforcement and preservation of the rights or remedies of the
Lessor under this Lease and the other Transaction Documents; and
(ii) all other amounts that the Lessee agrees herein to pay
other than Basic Rent, the Final Rent Payment (or the Completion Costs
Payment, if applicable) and amounts described in clause (i) above.
(d) This Lease is an absolute net lease, and Rent and all
other sums payable by the Lessee hereunder shall be paid without notice except
as otherwise expressly provided herein, and the Lessee shall not be entitled to
any abatement, reduction, setoff, counterclaim, defense or deduction with
respect to any Rent or other sums payable hereunder. The obligations of the
Lessee to pay Rent and all other sums payable hereunder shall not be affected by
reason of: (i) any damage to, or destruction of, the Facility or any part
thereof by any cause whatsoever (including, without limitation, fire, casualty
or act of God or enemy or any other force majeure event); (ii) any condemnation,
including, without limitation, a temporary condemnation of the Facility or any
portion thereof; (iii) any prohibition, limitation, restriction or prevention of
the Lessee's use, occupancy or enjoyment of the Facility or any part thereof by
any Person (other than by the Lessor in violation of this Lease); (iv) any
matter affecting title to the Facility or any portion thereof; (v) any eviction
of the Lessee from, or loss of possession by the Lessee of, the Facility or any
portion thereof, by reason of title paramount or otherwise (other than by the
Lessor in violation of this Lease); (vi) any default by the Lessor hereunder or
under any other Transaction Document; (vii) the invalidity or unenforceability
of any provision hereof or the impossibility or illegality of performance by the
Lessor or the Lessee or both; (viii) any action of any Governmental Authority;
or (ix) any other Loss Event, Casualty Occurrence or other cause or occurrence
whatsoever, whether similar or dissimilar to the foregoing. The Lessee shall
remain obliged under this Lease in accordance with its terms and shall not take
any action to terminate, rescind or avoid this Lease, except as expressly
provided in Section 15, notwithstanding any bankruptcy, insolvency,
reorganization, liquidation, dissolution or other proceeding affecting the
Lessor or any action with respect to this Lease which may be taken by any
trustee, receiver or liquidator or by any
4
<PAGE>
court. The Lessee waives all rights to terminate or surrender this Lease, except
as expressly provided in Section 15, or to any abatement or deferment of Rent or
other sums payable hereunder. The Lessee hereby waives any and all rights now or
hereafter conferred by law or otherwise to modify or to avoid strict compliance
with its obligations under this Lease. All payments made to the Lessor hereunder
as required hereby shall be final and irrevocable, and the Lessee shall not seek
to recover any such payment or any part thereof for any reason whatsoever,
absent manifest error.
(e) Subject to the Lessee's contest rights under Section 13,
the Lessee agrees that it will promptly pay all Impositions imposed upon or
levied or assessed against the Facility or any portion thereof, or against the
Lessor, the Agent or any Lender in connection with the transactions contemplated
by this Lease and the other Transaction Documents, or imposed or levied upon,
assessed against or measured by any Rent, sales or other sums payable hereunder,
or any sums levied in connection with the execution, delivery or recording of
the Transaction Documents, and will furnish to the Lessor upon request copies of
official receipts or other proof evidencing such payment; PROVIDED, HOWEVER,
that the Lessee shall not be obligated to pay (i) any Impositions that are based
upon or measured by the Lessor's, the Agent's or any Lender's overall net
income, or which are in substitution for, or relieve the Lessor, the Agent or
any Lender from, any actual Imposition based upon or measured by the Lessor's,
the Agent's or any Lender's overall net income (excluding, however, Impositions
imposed with respect to the payment, receipt or accrual of any indemnity payment
under this Lease or any other Transaction Document); (ii) Impositions
constituting franchise taxes imposed on any Lender by the jurisdiction under the
laws of which such Lender is organized or qualified or any political subdivision
thereof or by the jurisdiction in which such Lender's lending office is located;
or (iii) any Impositions attributable to the gross negligence or willful
misconduct of the Agent or any Lender. The Lessee further agrees that, subject
to its rights under Section 13, it will, at its expense, do all things required
to be done by the Lessor in connection with the levy, assessment, billing or
payment of any Impositions that it is required to pay pursuant to the preceding
sentence, and is hereby authorized by the Lessor to act for and on behalf of the
Lessor in any and all such respects and to prepare and file, on behalf of the
Lessor, all tax returns and reports required to be filed by the Lessor (other
than federal income tax returns and documents related thereto, subject to
Section 25) concerning the Facility. The Lessee's payment and other obligations
under this Section 3(f) shall survive the termination of this Lease. In the
event that any withholding or deduction from any payment to be made by the
Lessee hereunder is required in respect of any Imposition pursuant to any
Governmental Requirement, then the Lessee will:
5
<PAGE>
(1) pay directly to the relevant Governmental Authority
the full amount required to be so withheld or deducted;
(2) promptly forward to the Lessor, if available, an official
receipt or other documentation satisfactory to the Lessor evidencing
such payment to such Governmental Authority; and
(3) pay to the Lessor such additional amount or amounts as is
necessary to ensure that the net amount actually received by the Lessor
will equal the full amount the Lessor would have received had no such
withholding or deduction been required.
(f) All payments by the Lessee pursuant to this Lease shall be
made by the Lessee to the Lessor. All such payments required to be made to the
Lessor shall be made not later than 12:00 noon, prevailing Eastern time, on the
date due, in immediately available funds, to such account with the Agent as the
Lessor shall specify from time to time by notice to the Lessee. Whenever any
payment to be made shall otherwise be due on a day which is not a Business Day,
except as otherwise expressly provided herein or in the Credit Agreement, such
payment shall be made on the next succeeding Business Day and such extension
shall be included in computing Rent, interest, yield and fees, if any, in
connection with such payment.
(g) The Lessee shall pay on demand to the Lessor interest at
the Default Rate on all amounts payable by the Lessee to the Lessor hereunder in
respect of overdue principal of, interest and yield on, and fees in respect of
Loans and Lessor Investment Payments, and all other amounts payable under this
Lease or any of the other Transaction Documents, from the due date thereof until
paid in full.
Section 4. [ RESERVED ].
Section 5. CREDIT AGREEMENT; AGENCY AGREEMENT. The
Lessee and the Lessor are entering into the Credit Agreement with the Agent and
the Lenders pursuant and subject to which the Lessor will fund, and the Lenders
will fund for the account of the Lessor, the Funded Amount as therein provided
up to but not exceeding, for the entire Facility, the sum of the Lessor
Investment Commitment and the Aggregate Loan Commitments. In addition, the
Lessee is entering into the Agency Agreement with the Lessor pursuant to which
the Lessee will act as the Facility Agent for the Lessor in causing the
completion of certain enhancements and improvements to, and the purchase,
manufacture, construction, improvement, renovation, assembly and installation
of, the Facility. Upon funding pursuant to the Credit Agreement, title to all
components of the Facility funded shall be and remain in the Lessor, and,
6
<PAGE>
commencing with the Lease Commencement Date, the Facility shall be subject to
the terms and conditions of this Lease. The Facility and all components thereof
shall be purchased, manufactured, constructed, improved, renovated, assembled or
installed, as applicable, in accordance with the Related Contracts entered into
by the Lessee pursuant to the Agency Agreement.
Section 6. TITLE TO REMAIN IN THE LESSOR. The Lessor shall own
100% of the legal and beneficial interest in the Facility. All accessories,
equipment, parts, fixtures and devices affixed or placed on the Facility from
time to time by the Lessee, other than Excluded Equipment, and all
modifications, alterations, renovations or improvements to the Facility made by
the Lessee shall be and become part of the Facility for the purposes of this
Lease and shall be Property of the Lessor subject to the terms of this Lease;
PROVIDED that the Lessor's interest in any portion of the Facility that is
replaced by the Lessee in a manner not violative of this Lease shall be deemed
released from this Lease (and the Collateral) and thereupon become the Property
of the Lessee automatically, without further action by the Lessor, and the
Lessor shall perform all acts and execute all documents that the Lessee
reasonably requests to give effect to the foregoing at the expense of the
Lessee, including the execution and delivery of bills of sale and other
documents of transfer. This Lease shall not give or grant to the Lessee any
right, title or interest in or to the Facility, except the rights expressly
conferred by this Lease. All Excluded Equipment shall at all times remain the
property of Lessee at all times during the term of the Lease. The Lessor
acknowledges and agrees that the Lessee may finance the purchase, lease,
installation and replacement of any Excluded Equipment, subject to the
provisions of Section 8.15 of the Credit Agreement. Upon termination of the
lease, if the Lessee does not purchase the Facility pursuant to Section 15, the
Lessee shall have the right to remove any of the Excluded Equipment from the
Facility, provided that it repairs any damage caused to the Facility in the
process of such removal.
Section 7. MAINTENANCE OF THE FACILITY; OPERATIONS.
(a) The Lessee shall, and it shall require and cause any and
all employees, contractors, subcontractors, agents, representatives, affiliates,
consultants and occupants at the Lessee's own cost and expense to: (i) cause the
Facility to be maintained in all material respects in good operating order,
repair and condition, in accordance with prudent industry practice and any
applicable manufacturer's or supplier's manuals or warranties, subject to normal
wear and tear, and take all action, and make all changes and repairs, structural
and non-structural, foreseen and unforeseen, ordinary and extraordinary, which
are required pursuant to any Governmental Requirement or Insurance Requirement
at any time in effect to assure full compliance therewith in all material
7
<PAGE>
respects; and (ii) to all things necessary to prevent the incurrence of any
Environmental Damages or Environmental Liabilities relating to the Facility or
any business conducted in or relating to the Facility or the Site, and cause the
Facility to continue to have at all times, in all material respects, and in
compliance with all applicable Governmental Requirements and Insurance
Requirements, the capacity and functional ability to perform, on a continuing
basis (subject to normal interruption in the ordinary course of business for
maintenance, inspection, service, repair and testing) and in commercial
operation, the functions for which it was designed as specified in the Facility
Plan and to be utilized commercially for the Permitted Use.
(b) The Lessee shall, and it shall require and cause any and
all employees, contractors, subcontractors, agents, representatives, affiliates,
consultants and occupants at the Lessee's own cost and expense to, promptly
replace, or cause to be replaced, the Facility, or parts thereof which may from
time to time be incorporated or installed in or attached to the Facility, and
which may from time to time become worn out, lost, stolen, destroyed, seized,
confiscated, damaged beyond repair, obsolete or permanently rendered unfit for
use for any reason whatsoever. All replacement parts shall be free and clear of
all Liens other than Permitted Liens, and, except for temporary replacement
parts utilized pending installation of permanent replacement parts, shall be of
a type customarily used in the industry at such time for such purpose, shall be
in as good operating condition as, and shall have a utility and useful life at
least equal to, the parts replaced (assuming such replaced parts were in the
condition and repair required to be maintained by the terms hereof) and shall
have a value at least equal to the parts replaced (assuming such replaced parts
were in the condition and repair required to be maintained by the terms hereof).
(c) Notwithstanding the provisions of Section 8 and the
foregoing provisions of this Section 7, the Lessee shall not (except as may be
required by any Governmental Requirement) remove, replace or alter any portion
of the Facility or affix or place any accessory, equipment, part or device on
any portion of the Facility, if such removal, replacement, alteration or
addition would impair the originally intended function or use of the Facility so
as to materially reduce the value of the Facility taken as a whole, or
materially decrease the estimated useful life of the Facility.
(d) The Lessor shall not be required in any way to maintain,
repair or rebuild the Facility or any portion thereof and the Lessee waives any
right it may now or hereafter have to make any repairs at the expense of the
Lessor pursuant to any Governmental Requirement at any time in effect or
otherwise.
8
<PAGE>
(e) The Lessee shall, and it shall require and cause any and
all employees, contractors, subcontractors, agents, representatives, affiliates,
consultants and occupants at the Lessee's own cost and expense to: (i) comply
with all applicable Environmental Requirements with regard to the Facility and
all parts thereof; and (ii) use, employ, process, emit, generate, store, handle,
transport, dispose of and/or arrange for the disposal of, any and all Hazardous
Materials in, on or, directly or indirectly, related to or in connection with
the Facility or any part thereof in a manner consistent with prudent industry
practice and in compliance with any applicable Environmental Requirement. The
Lessor and the Lessee hereby acknowledge and agree that the Lessee's obligations
hereunder with respect to Environmental Requirements are intended to bind the
Lessee with respect to matters and conditions involving the Facility or any part
thereof.
Section 8. MODIFICATIONS.
(a) The Lessee shall make no modifications, alterations,
renovations or improvements to the Facility without the prior written consent of
the Lessor, provided however, that subject to the terms of Section 8(b), the
Lessee shall have the right to make modifications, alterations, renovations or
improvements to the Facility so long as such modifications, alterations,
renovations or improvements do not (except as may be required by any
Governmental Requirement) (i) materially reduce the value of the Facility as a
whole; (ii) materially and adversely affect the capacity and performance of the
Facility on a continuing basis in commercial operation of the function for which
the Facility was designed as specified in the Facility Plan; (iii) materially
deviate from the Facility Plan; or (iv) materially and adversely affect the
estimated useful life of the Facility. Within twenty (20) Business Days of the
end of each calendar year, an Authorized Officer of the Lessee shall deliver to
the Lessor and the Agent a schedule certifying to the Agent's satisfaction: (x)
the nature of the repairs, replacements, modifications, alterations, renovations
or improvements to the Facility made during such year having a cost of at least
$250,000 at the time made, and (y) that the Facility continues to have, in all
material respects, the capacity and functional ability to perform on a
continuing basis (subject to normal interruption in the ordinary course of
business for maintenance, inspection, service, repair and testing) and in
commercial operation, the functions for which it was designed as specified in
the Facility Plan or, if not, specifying the reason for any such deficiency.
Within twenty (20) Business Days after the occurrence of any Loss Event or
Casualty Occurrence with respect to the Facility, an Authorized Officer of the
Lessee shall deliver to the Lessor and the Agent a notice describing the
occurrence and nature of any such Loss Event or Casualty Occurrence.
9
<PAGE>
(b) If the Lessee determines that any part of the Facility is
no longer necessary for the performance of the Facility on a continuing basis in
commercial operation of the function for which the Facility was designed as
specified in the Facility Plan, then the Lessee (except when such action or
removal may be required by any applicable Governmental Requirement, in which
event, the Lessee shall promptly give the Agent notice of such action or
removal) shall give the Lessor and the Agent at least thirty (30) days' notice
prior to taking any action as the result of such determination and shall not
remove any such portion unless and until the Agent has determined that (i) such
portion is no longer necessary for the performance of the Facility on a
continuing basis in commercial operation of the function for which the Facility
was designed in all material respects as specified in the Facility Plan, (ii)
removal of such portion does not materially reduce the value of the Facility as
a whole, and (iii) removal of such portion does not materially decrease the
estimated useful life of the Facility. This Section 8(b) shall not apply to worn
out or obsolete Property or damaged Property (to the extent such damage does not
constitute a Casualty Occurrence or Loss Event) removed and replaced by the
Lessee in accordance with Section 7(b).
Section 9. FURTHER ASSURANCES. The Lessee, at its expense,
shall execute, acknowledge and deliver from time to time such further
counterparts of this Lease or such affidavits, certificates, certificates of
title, bills of sale, financing and continuation statements, consents and other
instruments as may be required by applicable law or reasonably requested by the
Lessor in order to evidence the Lessor's title to the Facility and the Lessor's
interests in this Lease, and shall, at the Lessee's expense, cause such
documents to be recorded, filed or registered in such places as the Lessor may
request and to be re-recorded, refiled or re-registered in such places as may be
required by applicable law or at such times as may be required by applicable law
in order to maintain and continue in effect the recordation, filing or
registration thereof. The Lessor shall not grant or create any Lien on the
Facility to any Person except Permitted Liens, Liens in favor of the Agent and
the Lenders and Liens pursuant to this Lease, the Security Instruments and the
other Transaction Documents.
Section 10. COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS AND
INSURANCE REQUIREMENTS: RELATED CONTRACTS. The Lessee, at its expense, will
comply with all Governmental Requirements applicable to the Facility or any
portion thereof or the ownership, construction, operation, mortgaging,
occupancy, possession, use, non-use or condition of the Facility or any portion
thereof, all Insurance Requirements, and all instruments, contracts or
agreements affecting title to ownership of the Facility or any portion thereof.
In addition, the Lessee, so long as no Event of Default has occurred and is
continuing, is hereby authorized by the
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Lessor to, and shall, fully and promptly keep, observe, perform and satisfy on
behalf of the Lessor any and all obligations, conditions, covenants and
restrictions of or on the Lessor or the Lessee under any and all Related
Contracts so that there will be no default thereunder and so that the other
parties thereunder shall be, and remain at all times, obliged to perform their
obligations thereunder, and the Lessee, to the extent within its control, shall
not permit to exist any condition, event or fact that could allow or serve as a
basis or justification for any such Person to avoid such performance.
Section 11. CONDITION AND USE OF FACILITY; QUIET
ENJOYMENT.
(a) The Facility is leased and the Lessee accepts and takes
possession of the Facility as is, where is, and with all faults and in the
condition thereof and subject to the rights of any parties in possession
thereof, the state of the title thereto, the rights of ownership therein and
subject to all Governmental Requirements now in effect or hereafter adopted, in
each case as in existence when the same first becomes subject to this Lease,
without representations and warranties of any kind as to title by the Lessor,
the Agent, any Lender or any Person acting on behalf of any of them. The Lessee
acknowledges and agrees that the Facility has not been selected by the Lessor,
the Agent or any Lender, that none of the Lessor, the Agent or any Lender has
supplied any specifications with respect to the Facility and that none of the
Lessor, the Agent or any Lender (i) is a Vendor of, or merchant or supplier with
respect to, any of the Property comprising the Facility or any Property of such
kind, (ii) has made any recommendation, given any advice or taken any other
action with respect to the choice of any manufacturer, supplier or transporter
of, or any vendor of or other contractor, including, without limitation, with
respect to Property comprising the Facility, (iii) has at any time had physical
possession of any such Property, (iv) has made or is making any warranty,
express or implied, relating to the Facility, including without limitation, with
respect to title, merchantability, fitness for a particular purpose or
otherwise, the design, condition, quality of material or workmanship, conformity
to specifications, freedom from patent or trademark infringement, absence of any
latent or other defects, whether or not discoverable, whether arising pursuant
to the UCC or any other present or future law or otherwise, or compliance with
Applicable Permits or other Governmental Requirements, or (v) shall be liable
for incidental or consequential damages (including liability in tort, strict or
otherwise). In the event of any defect or deficiency of any nature in the
Facility or any Property or other item constituting a portion thereof, whether
patent or latent, none of the Lessor, the Agent, or any Lender shall have any
responsibility or liability with respect thereto. The provisions of this Section
11 have been negotiated and are intended to be a
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complete exclusion and negation of any and all warranties, express or implied,
by the Lessor, the Agent and the Lenders with respect to the Facility or any
Property or other item constituting a portion thereof, whether arising pursuant
to the UCC or any other law now or hereafter in effect.
(b) The Lessor hereby assigns to the Lessee, until the
occurrence of a Cancellation Event or Termination Event hereunder, the benefits
in respect of any Vendor's warranties or undertakings, express or implied,
relating to the Facility (including any labor, equipment or parts supplied
therewith), and, to the extent assignment of the same is prohibited or precludes
enforcement of any such warranty or undertaking, the Lessor hereby subrogates
the Lessee to its rights in respect thereof. The Lessor hereby authorizes the
Lessee, at the Lessee's expense, to assert any and all claims and to prosecute
any and all suits, actions and proceedings, in its own name or in the name of
the Lessor, in respect of any such warranty or undertaking and, except after the
occurrence of a Cancellation Event or Termination Event hereunder, to retain the
proceeds received, and after the termination of this Lease or after the
occurrence of a Cancellation Event or Termination Event, to pay the same in the
form received (with any necessary endorsement) to the Lessor.
(c) The Lessee may use the Facility for the Permitted Use
provided that the value of the Facility is not diminished by any such use other
than as a result of normal wear and tear in the ordinary course of business.
During the term of this Lease, the Lessor covenants that unless a Cancellation
Event or a Termination Event has occurred and is continuing and except as may
arise under a Permitted Lien or as may otherwise by contemplated under the
Transaction Documents, the Lessor will not, and will not permit any party
claiming by, through or under the Lessor to, interfere with the peaceful and
quiet possession and enjoyment of the Facility by the Lessee; PROVIDED, HOWEVER,
that the Lessor, the Agent, the Lenders and their respective successors,
assigns, representatives and agents may, upon reasonable notice to the Lessee,
enter upon and examine the Facility or any part thereof at reasonable times,
subject to the provisions of Section 19; and PROVIDED FURTHER, HOWEVER, that the
Lessor is not hereby warranting the state or quality of the title to any portion
of the Facility. Any failure by the Lessor to comply with the foregoing
provisions of this Section 11(c) shall not give the Lessee any right to cancel
or terminate this Lease, or to abate, reduce or make reduction from or offset
against any Rent or other sum payable under this Lease or any other Transaction
Document, or to fail to perform or observe any other covenant, agreement or
obligation hereunder or thereunder. The Lessee will not do, or fail to do, or
permit or suffer to exist any act or thing, which action or thing or failure
might impair the value, use or usefulness of the Facility for the
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Permitted Use in accordance with the design of the Facility, ordinary wear and
tear excepted.
Section 12. LIENS.
(a) The Lessee will not directly or indirectly create, or
permit to be created or to remain, and at the Lessee's expense will discharge
within twenty (20) days of notice of the filing or assertion thereof, by bond,
deposit or otherwise, any Lien upon the Lease or the Facility except (i) any
Lien being contested as permitted by and in accordance with Section 13, or (ii)
Permitted Liens. The Lessor agrees that the Lessee shall have during the term of
this Lease the exclusive right (so long as no Default has occurred and is
continuing) to grant, create or suffer to exist Permitted Liens in the ordinary
course of business and in accordance with prudent industry practices, provided
that the fair market value or use of the Facility or the applicable portion
thereof for the Permitted Use is not materially lessened thereby. The Lessor
agrees to execute such documents and take all other actions as shall be
reasonably necessary, and otherwise to cooperate with the Lessee in connection
with the matters described above, provided that all reasonable out-of-pocket
costs and expenses (including, without limitation, reasonable attorneys' fees
and expenses) incurred by the Lessor in connection therewith shall be borne by
the Lessee, and the Lessor shall not be required to execute any document that
would, in the opinion of the Lessor, materially and adversely affect the value
or use of the Facility or any portion thereof for the Permitted Use or otherwise
materially and adversely affect the transactions contemplated by the Transaction
Documents or the interests of the Lessor, the Agent or the Lenders in the
Facility or under the Transaction Documents or otherwise.
(b) The Lessor will not directly or indirectly sell, transfer
or otherwise dispose of, or create, or permit to be created or to remain, and
will discharge, any Lien of any nature whatsoever on, in or with respect to, its
interest in the Facility arising by or through it or its actions, except
Permitted Liens.
(c) The Lessee will not directly or indirectly sell, transfer,
or otherwise dispose of its interest in the Facility.
(d) The Lessee acknowledges and agrees that this Lease is
subsequent, inferior, junior and subordinate in all respects to the Liens
created pursuant to the Security Instruments. The Lessee will not contest or
otherwise challenge through litigation or by any other means the agreement of
the parties hereto that the right, title and interest of the Agent, on behalf of
the Lenders, as the secured party under the Security Instruments in and to the
Facility is senior and superior to the right, title and interest of the Lessee
under this Lease.
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Section 13. PERMITTED CONTESTS. Notwithstanding any other
provision of this Lease to the contrary, after prior written notice to the
Lessor and provided there is no material risk of sale, forfeiture or loss of the
Facility or any material part thereof or interest therein, the Lessee may at its
expense contest any Imposition which it is required to pay hereunder, by
appropriate proceedings conducted in good faith and with due diligence, so long
as such proceedings are effective to prevent the collection of such Imposition
from the Lessor, the Agent, or the Lenders or against the Facility or any
portion thereof; PROVIDED, HOWEVER, that the actions of the Lessee, as
authorized by this Section 13, shall be subject to the express written consent
of the Agent and the Lessor if such actions would subject the Agent, the Lessor
or any such Lender or the Facility or any portion thereof to any liability or
loss not indemnified in full by the Lessee hereunder or any sanction, criminal
or otherwise, for failure to pay any such Imposition. The Lessee will pay, and
save the Lessor, the Agent and each such Lender harmless against, all losses,
Judgments and reasonable costs, including attorneys' fees and expenses, in
connection with any such contest and will, promptly after the final
determination of such contest, pay and discharge the amounts which shall be
imposed or determined to be payable therein, together with all penalties, costs
and expenses incurred in connection therewith. The Lessee shall prevent any
foreclosure, judicial sale, taking, loss or forfeiture of the Facility or any
portion thereof, or any interference with or deductions from any Rent or any
other sum required to be paid by the Lessee hereunder by reason of such
nonpayment or nondischarge of an Imposition. The Lessor shall cooperate with the
Lessee in any contest and shall allow the Lessee to conduct such contest (in the
name of the Lessor, if necessary) at the Lessee's sole cost and expense; and the
Lessee shall indemnify and hold the Lessor harmless from and against all
liabilities, costs and expenses in connection with such contest. The Lessee
shall notify the Lessor of each such proceeding within ten (10) days after the
commencement thereof, which notice shall describe such proceeding in reasonable
detail.
Section 14. INSURANCE, ETC. The Lessee will, at its own
expense, purchase and maintain, or cause to be purchased and maintained,
throughout the term of this Lease insurance with respect to its business and the
Facility in accordance with the requirements of Schedule 1.
(a) The Lessee shall bear all risk of loss (including any Loss
Event or Casualty Occurrence), whether by casualty, theft, taking, confiscation
or otherwise, with respect to the Facility or any portion thereof, at all times
during the term of this Lease until possession of the Facility has been accepted
by the Lessor pursuant to Section 17.
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(b) So long as no Termination Event or Cancellation Event
shall have occurred shall have occurred and be continuing, any payments, whether
constituting insurance proceeds, amounts paid by any Governmental Authority or
otherwise, received by the Lessee or the Lessor upon the occurrence of any loss
with respect to the Facility or portion thereof (other than a Casualty
Occurrence), whether as a result of casualty, theft, taking or other
confiscation, shall be applied in payment for necessary repairs and replacement
to the Facility in accordance with Section 7 or, to the extent the costs of such
repairs and replacement shall have been paid by the Lessee, to reimburse the
Lessee. The Lessee shall be entitled to retain any excess funds remaining after
necessary repairs and replacements have been completed and all costs therefor
paid in full. Upon the occurrence of any Termination Event or Cancellation
Event, the Lessor shall be entitled to receive and retain any such payments for
application to the obligations of the Lessee hereunder.
(c) Upon a Casualty Occurrence, the Lessee shall give prompt
notice thereof to the Lessor and shall within thirty (30) days of the date of
such Casualty Occurrence either (i) offer to purchase the whole of the Facility
for the Purchase Price as provided in Section 15(c) or (ii) provide the Lessor
and the Agent with a replacement plan acceptable to the Lessor and the Agent
setting forth how the Lessee shall replace, or cause to be replaced, at the
Lessee's own cost and expense, within (A) in the case of a Casualty Occurrence
in an aggregate amount less than $100,000, 90 days after the Casualty
Occurrence, (B) in the case of a Casualty Occurrence of $100,000 or more but
less than $250,000, 180 days after the Casualty Occurrence, and (C) in the case
of a Casualty Occurrence of $250,000 or more, 270 days after the Casualty
Occurrence, but in any case no later than the end of the Construction Term (if
the Casualty Loss occurs during the Construction Term) or the Scheduled Lease
Termination Date, as applicable, such portion of the Facility that is the
subject of a Casualty Occurrence in accordance with this Section 14(d) and
Section 7. If the Lessee chooses the option set forth in clause (ii) of the
preceding sentence, within the later to occur of (x) sixty (60) days after the
date of the Casualty Occurrence and (y) satisfaction of all applicable
Governmental Requirements, and obtaining all authorizations of Governmental
Authorities, required therefor (but in no event later than ninety (90) days
after the date of the Casualty Occurrence), the Lessee shall have commenced
repairs or replacements as specified in the replacement plan and shall
thereafter proceed diligently with such repairs and replacements to completion
(or, in the case of (A) above, such repairs and replacements shall have been
completed within such time). After completion of the repairs and replacements,
the Lessee shall demonstrate to the satisfaction of the Lessor and the Agent
that operations, capacity and production from the Facility have been restored to
the standards required for Completion.
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(d) All replacement Property of the Facility (other than
temporary replacement parts and equipment installed pending installation of
permanent replacement Property) installed pursuant to Section 14(d) shall be
free and clear of all Liens except Permitted Liens, and shall be in as good
operating condition as, and shall have a value and utility at least equal to,
the Property replaced immediately prior to the Casualty Occurrence to which such
Property was subject. For purposes of this Lease (including without limitation
Section 14(d) and Section 7), the Funded Amount and book value of the
replacement Property shall be deemed to equal the Funded Amount and book value
of the part(s) replaced thereby. All Property of the Facility at any time
removed from this Lease pursuant to Section 14(d) and Section 7 shall remain the
property of the Lessor, no matter where located, until such time as insurance
proceeds have been received by the Lessor at least equal to the book value of
such portion of the Facility or such portion shall be replaced by suitable items
that have been incorporated or installed on or attached to the Facility and that
meet the requirements specified above. Immediately upon any permanent
replacement Property becoming incorporated or installed on or attached to the
Facility as provided above, without further act, such permanent replacements
shall become subject to this Lease and be deemed part of the Facility for all
purposes hereof to the same extent as any other parts of the Facility. All
amounts of insurance proceeds for Property losses and all other proceeds
(whether resulting from damage or destruction or from condemnation, confiscation
or seizure) relating to the Facility shall be deposited into the Restoration
Account from any losses exceeding $250,000 per occurrence and held and released,
together with accrued interest thereon, as hereinafter provided. So long as a
Cancellation Event or Termination Event shall not have occurred, and provided
that the Lessor and the Agent shall have received a written application of the
Lessee accompanied by a certificate of an Authorized Officer of the Lessee
showing in reasonable detail the nature of any necessary repair, rebuilding and
restoration, the actual cash expenditures necessary for such repair, rebuilding
and restoration, the expected total expenditures required to complete such work
and evidence that sufficient funds are or will be available to complete such
work on a timely basis (such certificate to be acceptable to the Agent in all
respects), then the amounts available in the Restoration Account, together with
accrued interest thereon, shall be released by the Lessor immediately upon
receipt of such certification or, if applicable, from time to time on the last
Business Day of each month during the period of repair, rebuilding and
restoration in payment therefor against presentation to the Lessor of a
certificate executed by an Authorized Officer of the Lessee to the effect that
expenditures have been made, or costs incurred, by or for the account of the
Lessee or are reasonably anticipated to be made during the immediately following
one month period in a specified amount for the purposes of making repairs,
rebuilding and restoration in the amounts specified, that no
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Cancellation Event or Termination Event exists and all conditions precedent
herein provided relating to such withdrawal and payment have been satisfied.
Upon the occurrence of any Termination Event or Cancellation Event, the Lessor
shall be entitled to retain all amounts in the Restoration Account for
application to the obligations of the Lessee hereunder.
(e) If any Loss Event or Casualty Occurrence shall occur, the
Lessee shall promptly notify the Lessor and the Agent of such event in writing.
Section 15. TERMINATION; CANCELLATION; PURCHASE
OPTION.
(a) (i) The termination of this Lease (A) in accordance with
Section 2(b) (whether upon the scheduled expiration hereof or by the
refusal to agree to extend the then current Scheduled Lease Termination
Date), or (B) as a result of the declaration by Agent of a
Non-Completion Event, shall be a "TERMINATION EVENT," the effect of
which shall be to cause this Lease to terminate on the applicable Lease
Termination Date.
(ii) If a Termination Event occurs, the Lessee, on
the Lease Termination Date, shall, in accordance with the terms of
Section 2(b), without further notice or demand to the Lessee, either
(A) purchase the Facility from the Lessor for the
Purchase Price; or
(B) so long as no Cancellation Event has occurred:
(1) pay to the Lessor, or at the Lessor's option, to
the Agent for the account of the Lessor, the Final Rent Payment (or
Completion Costs Payment, if a Non-Completion Event has occurred); and
(2) attempt to sell (until such time as the Lessor
shall have terminated, in accordance with the Agency Agreement, the
Lessee's obligation to so attempt to sell the Facility), subject to the
Agent's prior written approval, the Facility, as agent for the Lessor,
without recourse or warranty by the Lessor, for a net cash purchase
price not less than, and remit to the Lessor the net cash sales
proceeds equal to, the Termination Value less any amount paid pursuant
to Section 15(a)(ii)(B)(1). The Lessor and/or the Agent shall also have
the right (but not the obligation) to sell the Facility and/or solicit
bids, each in its sole and absolute discretion.
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(b) (i) Each of the following events shall be a "CANCELLATION
EVENT", the effect of which shall be to cause this Lease to be
terminated in accordance with the following provisions on the
"CANCELLATION DATE" specified:
(A) the occurrence of (1) an Event of Default (other than an
Event of Default under Section 17(a)(iv) hereof or Section 9.01(h) or
(i) of the Credit Agreement) and the delivery by the Agent to the
Lessee of a notice stating that the Lessor elects to terminate this
Lease by reason of the existence of such Event of Default, in which
case the Cancellation Date will be the fifth (5th) Business Day after
the date of delivery of said notice to the Lessee, or (2) an Event of
Default under Section 17(a)(iv) hereof or Section 9.01(h) or (i) of the
Credit Agreement in which case the Cancellation Date shall occur
immediately upon the occurrence of such Event of Default; or
(B) the occurrence of a Loss Event, in which case the
Cancellation Date shall be the fifth (5th) Business Day after such
event occurs; or
(C) the occurrence of a Casualty Occurrence in respect of the
Facility and the failure of the Lessee to purchase the Facility or to
replace or repair the Facility or such portion thereof in accordance
with, and within the time required by, Section 14(d), including,
without limitation, subsections (i) and (ii) thereof, and the delivery
by the Agent to the Lessee of a notice after the expiration of such
time stating that the Lessor elects to terminate this Lease by reason
of the existence of such Casualty Occurrence, in which case the
Cancellation Date shall be the fifth (5th) Business Day after the date
of delivery of said notice; or
(D) the occurrence of Change of Control and the delivery by
the Agent (acting at the direction of the Majority Lenders) to the
Lessee of a notice stating that the Lessor elects to terminate this
Lease by reason of the occurrence of such Change of Control, in which
case the Cancellation Date will be the fifth (5th) Business Day after
the date of delivery of said notice to the Lessee.
(ii) If a Cancellation Event occurs, the Lessee, on
the Cancellation Date, shall, without further notice or demand to the
Lessee, either (A) purchase the Facility from the Lessor for the
Purchase Price, or (B) pay to Lessor the Termination Value. If
requested by the Lessor, the Lessee shall pay the Purchase Price or the
Termination Value, as the case may be, to the Agent for the account of
the Lessor.
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(c) The Lessee may, from time to time and at any time, deliver
to the Lessor and the Agent notice of its intent to terminate this Lease, in
which case the Lessee shall purchase the Facility from the Lessor for the
Purchase Price on any Rent Payment Date that is not less than thirty (30) nor
more than sixty (60) days after such notice (the "OPTION DATE"). Upon payment in
full of the Purchase Price, this Lease shall terminate.
(d) This Lease shall cease and terminate on the Lease
Termination Date, Cancellation Date or Option Date, as applicable, except with
respect to (i) obligations and liabilities of the Lessee, actual or contingent,
which arose under this Lease, or by reason of events or circumstances occurring
or existing, on or prior to its termination, and which have not been satisfied
(which obligations shall continue until satisfied and which include, but are not
limited to, obligations for Rent and the Termination Value, the Purchase Price
and amounts owing pursuant to Section 16), (ii) all rights and remedies of the
Lessor under or in respect of this Lease, including without limitation the
provisions of Section 26 hereof, and (iii) obligations of the Lessee which by
the terms of this Lease expressly survive termination. Promptly after either the
Lessee or the Lessor shall learn of the happening of any Termination Event or
Cancellation Event, such party shall give notice thereof to the other party
hereto and to the Agent.
(e) In the event Lessee elects to purchase the Facility upon
the occurrence of a Termination Event (other than the expiration of this Lease
on a Scheduled Lease Termination Date) or a Cancellation Event, Lessee in its
sole discretion in order to ensure the orderly conveyance of the Facility may
postpone the closing date for such conveyance (whether or not extended, the
"Purchase Closing Date") to a reasonable date within sixty (60) days following
the Lease Termination Date or Cancellation Date, as applicable; provided
however, that notwithstanding any such postponement the Lessee shall nonetheless
be required to deposit on or before the Lease Termination Date or Cancellation
Date, as applicable, the Purchase Price (estimated at the time of the deposit)
with the nationally recognized title insurance company which insured Lessor's
leasehold interest in the Facility (or if such title company is unable or
unwilling to serve in such capacity, a replacement nationally recognized title
insurance company designated by Lessor) to be held in escrow pending
consummation of the closing on or before the extended Purchase Closing Date.
Lessor or Agent shall notify Lessee of any such postponement and the proposed
extended Purchase Closing Date in writing on or before the Lease Termination
Date or Cancellation Date, as applicable. Provided that Lessee deposits the
estimated Purchase Price on or before the applicable Lease Termination Date or
Cancellation Date, as appropriate, Lessee shall be deemed to have been granted a
temporary license by Lessor entitling Lessee to retain possession of the
Facility through the Purchase Closing Date
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provided that Lessee complies with all obligations of Lessee under this Lease as
though this Lease were still in full force and effect (including without
limitation, compliance with permitted use, maintenance and insurance coverage
requirements). In the event of an extension of the Purchase Closing Date as
herein contemplated, the Purchase Price (including the Final Rent Payment
component thereof) will be calculated as of such extended Purchase Closing Date.
This Section 15(e) shall survive the termination of this Lease.
Section 16. TRANSFER OF TITLE ON REMOVAL OF FACILITY;
EXPENSES OF TRANSFER.
(a) Upon any sale or purchase permitted by Section 15, the
Lessor will transfer to the Lessee or the appropriate Third Party all of its
title to and legal and beneficial ownership interest in the Facility (i) free
and clear of any Lien created by, through or under the Lessor other than
Permitted Liens or Liens created at the request of or as a result of the actions
of Lessee or anyone acting by, through or under Lessee, or as a result of the
failure of Lessee to carry out any of its obligations under this Lease or the
other Transaction Documents, and (ii) without recourse, representation or
warranty of any nature whatsoever (except as to the absence of such Liens as
aforesaid).
(b) Whenever the Lessee has the right to purchase or transfer
to itself the Facility pursuant to any provision of this Lease, the Lessee may
cause such purchase to be effected by, or such transfer to be effected to, any
other Person specified by the Lessee, but in no event shall the Lessee be
relieved from any of its obligations hereunder as a result thereof.
(c) Upon any sale or transfer of the Facility pursuant to any
provision of this Lease, the Lessee shall pay the expenses of the Agent and the
Lessor, including, without limitation, reasonable attorneys' fees and expenses,
in connection with such sale or transfer.
(d) If, on the Lease Termination Date or on the Cancellation
Date, as applicable, the Lessee or any of its Affiliates has not elected to
acquire the Facility, the Lessee shall surrender the Facility to the Lessor free
from all Liens except Permitted Liens (other than those described in clause
(ii)(b) of the definition of Permitted Liens), in the same operating condition
(except for ordinary wear and tear) with the remaining original estimated useful
life contemplated by the Facility Plan intact and having the same capacity and
efficiency as the Facility had on the Lease Commencement Date, and in compliance
in all material respects with all Governmental Requirements and Insurance
Requirements, and free of all Environmental Damages and Environmental
Liabilities. To evidence the foregoing and
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accomplish the surrender of the Facility, the Lessee shall provide the following
items (x) in the event of a Termination Event under Section 15(a)(i)(A) within
nine (9) months prior to the then current Lease Termination Date, with final
confirmation of the same at least thirty (30) days but not more than sixty (60)
days prior thereto and (y) in the event of a Termination Event under Section
15(a)(i)(B), as soon as practicable but in any event at least three (3) Business
Days prior to the Lease Termination Date or Cancellation Date, as applicable:
(i) evidence satisfactory to the Lessor and the Agent that all
Applicable Permits, Related Contracts, patents, trademarks and
copyrights, and all other rights and services reasonably required to
operate the Facility have been, or on or prior to the Lease Termination
Date shall be, transferred to the Lessor (or the Lessor has been, or on
or prior to the Lease Termination Date or Cancellation Date, as
applicable, shall be, given the right to use each such item) and can be
transferred to (or used by) any successor or assignee of the Lessor
without further consent or approval by any Person (subject only to
normal Governmental Requirements);
(ii) conveyancing, assignment, transfer, termination and other
documents that, in the sole discretion of the Lessor, the Agent and the
Lenders, are sufficient to (A) vest in the Lessor good and marketable
title to the Facility, free and clear of all Liens except Permitted
Liens (other than those described in clause (ii)(b) of the definition
of Permitted Liens) and (B) terminate the rights of the Lessee and all
other Persons in and to the Facility;
(iii) evidence satisfactory to the Lessor and the Agent that
the Facility has been operated and maintained in accordance with the
requirements of the Transaction Documents, all Governmental
Requirements, all Applicable Permits and prudent industry practices;
(iv) evidence satisfactory to the Agent that the Facility is
being used solely for the Permitted Use and is operating in accordance
with the requirements set forth in the Facility Plan, meets or exceeds
the original design specifications and is capable of operating and
being used for the Permitted Use as set forth in the Facility Plan, and
has the remaining original estimated useful life contemplated by the
Facility Plan;
(v) evidence satisfactory to the Lessor and the Agent, in
their sole discretion, that (A) no default exists under the Agency
Agreement, (B) all agreements and arrangements to provide the services
and rights contemplated by the Agency Agreement are in place, executed
by the parties thereto, and
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are valid, enforceable and in full force and effect on or before the
Lease Termination Date or Cancellation Date, as applicable and (C) such
agreements and arrangements adequately provide for the services and
other rights contemplated by the Agency Agreement;
(vi) an updated Environmental Assessment and
(vii) such other documents, instruments, assessments,
investigations, legal opinions, surveys and other items as the Lessor
and/or the Agent may reasonably request to evidence to the satisfaction
of each of the Lessor, the Agent and the Lenders (in each case, in
their sole discretion) that (A) the Lessor has all Property, services,
Permits, assets and rights necessary to own, operate and maintain the
Facility from and after the Lease Termination Date or Cancellation
Date, as applicable, and (B) no Default, Loss Event or Casualty
Occurrence then exists.
To the extent the Facility is not in the condition required by this
Section 16(d), the Lessee will pay to the Lessor such additional
amounts as are reasonably required to place it in compliance. The
Lessee shall also pay all costs and expenses relating to the surrender
and clean-up in connection with the surrender of the Facility as may be
required by Governmental Requirements or Insurance Requirements or
which are otherwise necessary to prevent or remedy any Environmental
Damages or Environmental Liabilities or to consummate the delivery of
possession of the Facility to the Lessor hereunder.
Section 17. EVENTS OF DEFAULT AND REMEDIES.
(a) Each of the following acts or occurrences shall constitute
an "EVENT OF DEFAULT" hereunder:
(i) default in the payment of the Purchase Price on the Option
Date, or in the payment of the Purchase Price or in the Termination
Value on the Cancellation Date or the Purchase Closing Date, as
applicable, or in the payment of the Purchase Price or the Final Rent
Payment on the Lease Termination Date or the Purchase Closing Date, as
applicable; or the default in the payment when due of any Basic Rent
and the continuance of such default for five (5) Business Days
thereafter; or the default in the payment when due of any Supplemental
Rent, the amount of any Indemnified Risk or any other amount due
hereunder or under any other Transaction Document and the continuance
of such default for five (5) Business Days thereafter; or
(ii) any representation or warranty made or deemed made by the
Lessee herein, by Lessee or any Guarantor in any other
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Transaction Document or otherwise in writing in connection with or
pursuant to this Lease or any other Transaction Document, shall be
false or misleading in any material respect on the date made or deemed
made; or
(iii) an Event of Default under the Credit Agreement;
(iv) The Lessor or any Guarantor shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking
the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its Property, or
shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as
they become due, or shall take any corporate action to authorize any of
the foregoing; or (B) an involuntary case or other proceeding shall be
commenced against the Lessee or any Guarantor seeking liquidation,
reorganization or other relief with respect to it or its debts under
any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part of
its Property, and such involuntary case or other proceeding shall
remain undismissed and unstayed for a period of sixty (60) days; or (C)
an order for relief shall be entered against the Lessee or any
Guarantor under the federal bankruptcy laws as now or hereafter in
effect; or
(v) The Lessee shall fail to observe or perform any covenant
or agreement contained in Sections 12, 14 and 26 of this Lease or any
Guarantor shall fail to observe or perform any covenant or agreement
contained in the Guaranty (Lessee); or
(vi) Lessee shall abandon the Facility; provided however that
for purposes of this Section 17(a)(vii), the term "abandon" shall not
include the mere failure of Lessee to occupy the Facility so long as
Lessee continues to perform its obligations hereunder and other
Transaction Documents including without limitation maintenance of the
Facility, maintenance of required insurance, compliance with
Governmental Requirements and Insurance Requirements and payment of all
Rent.
(b) Upon the occurrence and during the continuance of
any Event of Default, the Lessor may do any one or more of the
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following (without prejudice to the obligations of the Lessee under
Section 15(b)(ii)):
(i) proceed by appropriate judicial proceedings, either at
law, in equity or in bankruptcy, to enforce performance or observance
by the Lessee of the applicable provisions of this Lease, or to recover
damages for the breach of any such provisions, or any other equitable
or legal remedy, all as the Lessor shall deem necessary or advisable;
and/or
(ii) by notice to the Lessee, either (x) terminate this Lease
in accordance with Section 15, whereupon the Lessee's interest and all
rights of the Lessee to the use of the Facility shall forthwith
terminate subject to the Lessee's rights under such Section 15 to
acquire the Facility on the Purchase Closing Date as provided herein,
but the Lessee shall remain liable with respect to its obligations and
liabilities hereunder; or (y) terminate the Lessee's right to
possession of the Facility or any portion thereof; and/or
(iii) exercise any and all other remedies available under
applicable law or at equity.
(c) After the occurrence and during the continuance of a
Cancellation Event or Termination Event, in the event the Lessor elects not to
terminate this Lease and the Lessee has not exercised its option under Section
15(c), this Lease shall continue in effect and the Lessor may enforce all of the
Lessor's rights and remedies under this Lease, including, without limitation,
the right to recover the Basic Rent and Supplemental Rent as it becomes due
under this Lease. For the purposes hereof, the following do not constitute a
cancellation or termination of this Lease: (i) acts of maintenance or
preservation of the Facility or any portion thereof, (ii) efforts by the Lessor
or the Agent to relet the Facility or any portion thereof, including, without
limitation, termination of any sublease of the Facility and removal of any
subtenant from the Facility, (iii) or the appointment of a receiver upon the
initiative of the Lessor to protect the Lessor's interest under this Lease.
(d) If (i) on the Lease Termination Date, the Facility is not
acquired by the Lessee or its designee by payment of the Purchase Price, or (ii)
on the Cancellation Date or Option Date, the Lessee or its designee has
defaulted in its obligation to acquire the Facility and pay the Purchase Price,
or if applicable, the Termination Value, in accordance with Lessee's election
under Section 15(b)(ii), then the Lessor shall have the immediate right of
possession of the Facility and the right to enter onto the Site, and the Lessor
may thenceforth hold, possess and enjoy the Facility free from any rights of the
Lessee and any Person claiming by, through or under the Lessee. The Lessor shall
be under no
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liability by reason of any such repossession of the Facility or
entry onto the Site.
(e) Should the Lessor elect to repossess the Facility or any
portion thereof upon cancellation or termination of this Lease or otherwise in
the exercise of the Lessor's remedies, the Lessee shall peaceably quit and
surrender the Facility or any such portion thereof to the Lessor and either (i)
deliver possession of the Facility to the Lessor or (ii) allow Lessor or its
agents or assigns to enter onto the Facility and the Site to remove any and all
of the Property comprising the Facility at the expense of the Lessee, and
neither the Lessee nor any Person claiming through or under the Lessee shall
thereafter be entitled to possession or to remain in possession of the Facility
or any portion thereof but shall forthwith peaceably quit and surrender the
Facility to the Lessor.
(f) At any time after the repossession of the Facility or any
portion thereof, whether or not this Lease shall have been canceled or
terminated, the Lessor may (but shall be under no obligation to) relet the
Facility or the applicable portion thereof without notice to the Lessee, for
such term or terms and on such conditions and for such usage as the Lessor in
its sole and absolute discretion may determine. The Lessor may collect and
receive any rents payable by reason of such reletting, and the Lessor shall not
be liable for any failure to relet the Facility or for any failure to collect
any rent due upon any such reletting.
(g) The remedies herein provided in case of an Event of
Default are in addition to, and without prejudice to, Lessee's continuing
obligations under Section 15(b)(ii), and shall not be deemed to be exclusive,
but shall be cumulative and shall be in addition to all other remedies existing
at law, in equity or in bankruptcy. Lessor may exercise any remedy without
waiving its right to exercise any other remedy hereunder or existing at law, in
equity or in bankruptcy.
(h) No waiver by the Lessor hereunder of any Default or Event
of Default shall constitute a waiver of any other or subsequent Default or Event
of Default. To the extent permitted by applicable law, the Lessee waives any
right it may have at any time to require the Lessor to mitigate the Lessor's
damages upon the occurrence of a Default or Event of Default by taking any
action or exercising any remedy that may be available to the Lessor, the
exercise of remedies hereunder being at the discretion of the Lessor.
Section 18. CHANGE IN THE LESSEE'S NAME OR STRUCTURE.
The Lessee will not change its name, identity or corporate structure (including,
without limitation, by any merger, consolidation or sale of substantially all of
its assets) without
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notifying Lessor of such change in writing at least sixty (60) days prior to the
effective date of such change.
Section 19. INSPECTION; RIGHT TO ENTER PREMISES OF THE LESSEE.
The Lessee shall permit, and cause each of its Subsidiaries to permit, the
Agent, the Lessor, any Lender or their respective authorized representatives may
(but without any obligation to do so) (i) enter upon the Facility or any
premises of the Lessee at reasonable times upon reasonable advance notice in
order to inspect the Facility (subject to compliance with applicable safety
requirements of Lessee and applicable Governmental Requirements) and to examine,
audit and make abstracts from any of their respective books and records and to
discuss the condition, compliance with Governmental Requirements, performance of
the Facility and the respective affairs, finances and accounts of Lessee and its
Subsidiaries with their respective officers, employees and independent
accountants. Lessee agrees to coordinate and assist in such visits and
inspections, in each case at such reasonable times and as often as may
reasonably be desired.
Section 20. RIGHT TO PERFORM THE LESSEE'S COVENANTS. Subject
to Section 13, if the Lessee shall fail to make any payment or perform any act
required to be made or performed by it hereunder, the Agent or the Lessor, upon
notice to or demand upon the Lessee but without waiving or releasing any
obligation or Default or Event of Default, may (but shall be under no obligation
to) at any time thereafter make such payment or perform such act for the account
and at the expense of the Lessee as, at the Lessor's sole discretion, may be
necessary or appropriate therefor and, upon the occurrence and during the
continuance of a Cancellation Event or Termination Event, may enter upon the
Facility for such purpose and take all such action thereon as, at the Lessor's
sole discretion, may be necessary or appropriate therefor. No such entry shall
be deemed an eviction of the Lessee. All sums so paid by the Lessor and all
costs and expenses (including, without limitation, reasonable attorneys' fees
and expenses so incurred) shall be paid by the Lessee to the Lessor on demand as
Supplemental Rent.
Section 21. PARTICIPATION BY CO-LESSEES OR SUBLESSEES.
(a) Except as otherwise permitted in this Section 21, neither
the Lessor nor the Lessee may assign its rights or obligations under this Lease
without the prior consent of all of the Lenders and the Agent. The Lessor has
granted a Lien on this Lease to the Agent for the benefit of the Lenders to
secure the obligation of the Lessor under the Credit Agreement. The Agent,
acting on behalf of the Lenders, shall be entitled to exercise all of the
rights, remedies, powers and privileges herein conferred upon Lessor (including,
without limitation, in any bankruptcy proceeding), to give or withhold all
consents required to be
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obtained from Lessor hereunder, to give all notices on behalf of the Lessor
including notices regarding Rent, the Final Rent Payment and Supplemental Rent
due hereunder, to receive all payments to be made to the Lessor hereunder and to
approve any sale of the Facility pursuant to Section 15 to a Person other than
the Lessee or any designee of the Lessee or for a price less than the
Termination Value; PROVIDED, HOWEVER, that nothing herein shall be deemed to be
a waiver or relinquishment of the right of the Lessor to receive Supplemental
Rent for its out of pocket costs and expenses as described in Section 3(d)(i) or
to be indemnified for any matter for which Lessor is entitled to indemnification
hereunder.
(b) The Lessor and the Lessee may from time to time, so long
as no Default, Cancellation Event or Termination Event shall have occurred and
be continuing, enter into documentation amending this Lease and, as necessary,
the other Transaction Documents, to evidence the undertaking of a Person (a
"CO-LESSEE") to be responsible for all or certain obligations of the Lessee and
the attendant reduction in the obligations of the Lessee hereunder, subject in
every case to (i) documentation satisfactory to the Agent and the Lenders
amending this Lease and the Transaction Documents and continued perfection and
protection of the Lessor's interest; (ii) such documentation shall expressly
state that such assignment is subject to the terms of this Lease and the Liens
created by the Security Instruments; and (iii) the Lessee remaining primarily
liable for all obligations of the tenant of the Facility under this Lease. Any
assignment made otherwise than as expressly permitted by this Section 21(b)
shall be null and void and of no force and effect.
(c) The Lessee may, from time to time, so long as no Default,
Cancellation Event or Termination Event shall have occurred and be continuing,
enter into a sublease and such other documentation as may be necessary with one
or more Persons (each a "SUBLESSEE"). In any event, any documentation executed
by the Lessee in connection with the subletting of the Facility (i) shall
expressly state that such sublease is subject and subordinate to the terms of
this Lease and the Liens created by the Security Instruments and (ii) shall not
provide for a sublease term ending after the then current Scheduled Lease
Termination Date. The Lessee will furnish promptly to the Lessor and Agent
copies of all subleases and related documentation entered into by the Lessee
from time to time. No sublease permitted by the terms hereof will reduce in any
respect the obligations of the Lessee hereunder, it being the intent of the
Lessee and the Lessor that the Lessee be and remain directly and primarily
liable as a principal for its obligations hereunder. Any sublease made otherwise
than as expressly permitted by this Section 21(c) shall be null and void and of
no force or effect.
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Section 22. NOTICES. Except as otherwise provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telecopier and other readable communication) and mailed by certified
mail, return receipt requested, telecopied or otherwise transmitted or
delivered, if to the Lessee, at 2850 Douglas Road, Coral Gables, Florida 33135,
Attention: Elizabeth J. Keeler, General Counsel, Telecopier: 305- 460-2396; if
to the Lessor, at One Federal Street, Boston, Massachusetts 02211, Attention:
Jay Hart, Telecopier: 617-346-0513; with copies to the Agent at 75 State Street,
Boston, Massachusetts 02109, Attention: Ginger Stolzenthaler, Telecopier:
617-346-1634; or, as to each party, at such other address as shall be designated
by such party in a written notice to the other parties. All such notices and
communications shall, if so mailed, telecopied or otherwise transmitted, be
effective when received, if mailed, or when the appropriate answer back or other
evidence of receipt is given, if telecopied or otherwise transmitted,
respectively. A notice received by the Lessor or the Agent by telephone shall be
effective if the Lessor or the Agent believes in good faith that it was given by
an authorized representative of the Lessee and acts pursuant thereto,
notwithstanding the absence of written confirmation or any contradictory
provision thereof.
Section 23. AMENDMENTS AND WAIVERS. The provisions of this
Lease may from time to time be amended, modified or waived only if such
amendment, modification or waiver is in writing and consented to by the Lessee,
the Lessor and the Agent and, if applicable, in accordance with Section 22.
Section 24. SEVERABILITY. Any provision of this Lease which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Section 25. FEDERAL INCOME TAX CONSIDERATIONS. It is the
understanding of the parties that for income tax purposes this transaction will
be treated as a financing and the Lessee will be treated as the owner of the
Facility; and the Lessee and the Lessor agree not to take any action
inconsistent with such treatment, subject to the following sentence.
Notwithstanding anything in this Section to the contrary, the Lessor and/or the
Agent retain the right to assert that it is the owner of the Facility subject to
this Lease for income tax purposes in the event that there is a determination
(within the meaning of Section 1313 of the Code or with respect to state or
local income tax, a comparable determination under state or local law) that the
Lessee is not to be treated as the owner of the Facility.
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Section 26. OTHER PROVISIONS. In order to protect the rights
and remedies of the Lessor and the Lessee both during the term of this Lease and
following a Default, a Termination Event or a Cancellation Event, and for the
purposes of Federal, state and local income and AD VALOREM taxes, state and
local sales taxes, documentary stamp and intangibles taxes and other taxes
relating to or assessable as a result of the execution, delivery or recording of
any of the Transaction Documents and for purposes of Title 11 of the United
States Code (or any other applicable Federal, state or local insolvency,
reorganization, moratorium, fraudulent conveyance or similar law now or
hereafter in effect for the relief of debtors), the parties hereto intend that
(a) this Lease be treated as the repayment, provisions of a loan by Lessor to
Lessee in a collective amount of the aggregate unpaid Tranche A Loans, Tranche B
Loans and Lessor Investment Payments and be treated as the security provisions
of a loan by Lessor to Lessee in a collective amount of the aggregate unpaid
Tranche A Loans, Tranche B Loans and Lessor Investment Payments, (b) a portion
of the payments of Rent, Supplemental Rent, the Final Rent Payment (or
Completion Costs Payment, if applicable) and the Termination Value be treated as
payments of principal, interest and other amounts owing with respect to the
Tranche A Loans, the Tranche B Loans and Lessor Investment Payments,
respectively, (c) the Lessee should be treated as entitled to all benefits of
ownership of the Facility or any part thereof, (d) this Lease be treated as a
mortgage, fixture financing statement and security agreement or other similar
instrument (the "MORTGAGE") from Lessee, as mortgagor, to Lessee, as mortgagee,
and as a security agreement from the Lessee, as debtor, to the Lessor, as
secured party, encumbering the Facility and all Property comprising the
Facility, and that the Lessee, as debtor and mortgagor, hereby grants and
mortgages to the Lessor (the "SECURED PARTY"), as secured party and mortgagee, a
first and prior Mortgage and Lien on and security interest in the equipment,
fixtures, and any and all other personal property of any kind or character
comprising the Facility and all proceeds therefrom, in each case being effective
as of the date of this Lease. In such event, the Lessor shall have all of the
rights, powers and remedies of a mortgagee and a secured party available under
applicable law, including, without limitation, judicial foreclosure, as and to
the extent available under applicable law, PROVIDED HOWEVER, that
notwithstanding anything to the contrary set forth herein, the amounts secured
by the real property Liens and security interests of the Mortgage shall be
limited to $360,000.00 plus (y) any other amounts owing to the Lessor or any
other party under the Transaction Documents (including Supplemental Rent), and
for purposes of this Section 26 the balance of the Obligations in excess of
$360,000.00 shall be deemed not secured by real property. The filing of this
Lease (or a memorandum hereof) shall be deemed to constitute the filing of a
mortgage and fixture filing and the filing of any financing statement in
connection with this Lease shall be deemed to constitute the filing of a
financing statement
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to perfect the mortgage lien and security interests in the Facility as aforesaid
to secure the payment of all amounts due from time to time from the Lessee to
the Lessor under this Lease and the other Transaction Documents (subject to the
limitations set forth in the preceding sentence). If this transaction is treated
as a financing, the obligation arising hereunder shall be with recourse to the
Lessee for all amounts payable by Lessee hereunder and shall not be treated as
recourse only to the Facility. To the fullest extent permitted by applicable
law, the Lessor and the Lessee intend that the Facility (other than the real
property constituting the Site) be and remain at all times personal property
regardless of the manner or extent to which any of the Facility (other than the
real property constituting the Site) may be attached or affixed to any real
property.
This Mortgage secures and shall be security for any and all
future advances made by Secured Party relating to the protection and
preservation of the "Collateral," as defined below. Nothing contained herein
shall be deemed an obligation on the part of the Secured Party to make any
further advances.
In order to preserve the security interest provided for
herein, each of the Lessor and the Lessee agrees to abide by the following
provisions with regard to the Facility (for purposes of this Section,
hereinafter referred to as "COLLATERAL"):
(a) CHANGE IN LOCATION OF COLLATERAL OR THE LESSEE. The
Lessee will notify the Secured Party on or before the date of any change in
location of the Collateral and will, on or before the date of any change in
location of the Collateral, prepare and file new or amended financing statements
as necessary so that the Secured Party shall continue to have a first and prior
perfected Lien (subject only to Permitted Liens) in such Collateral after such
change in location. The Lessee will give the Secured Party thirty (30) days'
prior written notice of any change in the location of the Lessee's chief
executive office or address.
(b) DOCUMENTS; COLLATERAL IN POSSESSION OF THIRD PARTIES. If
certificates of title or other documents evidencing ownership or possession of
the Collateral are issued or outstanding, the Lessee will cause the interest of
the Secured Party to be properly noted thereon and will, forthwith upon receipt,
deliver same to the Secured Party. If any Collateral is at any time in the
possession or control of any warehouseman, bailee, agent or independent
contractor, the Lessee shall notify such Person of the Secured Party's security
interest in such Collateral. Upon the Secured Party's request, the Lessee shall
instruct any such Person to hold all such Collateral for the Secured Party's
account subject to the Lessee's instructions, or, if an Event of Default shall
have occurred and be continuing, subject to the Secured Party's instructions.
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(c) SALE, DISPOSITION OR ENCUMBRANCE OF COLLATERAL. Except for
Permitted Liens, as permitted by any of the Transaction Documents or with the
Secured Party's prior written consent, the Lessee will not in any way encumber
any of the Collateral (or permit or suffer any of the Collateral to be
encumbered) or sell, assign, lend, rent, lease or otherwise dispose of or
transfer any of the Collateral to or in favor of any Person other than the
Secured Party.
(d) PROCEEDS OF COLLATERAL. Except as permitted by any of the
Transaction Documents, the Lessee will deliver to the Secured Party promptly
upon receipt all proceeds delivered to the Lessee from the sale or disposition
of any Collateral. This Section shall not be construed to permit sales or
dispositions of the Collateral except as may be elsewhere expressly permitted by
this Lease or the other Transaction Documents.
(e) FURTHER ASSURANCES. Upon the request of the Secured Party,
Lessee shall (at Lessee's expense) execute and deliver all such mortgages, deeds
of trust, assignments, certificates, financing statements or other documents and
give further assurances and do all other acts and things as the Secured Party
may reasonably request to perfect the Secured Party's interest in the Collateral
or to protect, enforce or otherwise effect the Secured Party's rights and
remedies hereunder, all in form and substance satisfactory to the Secured Party.
(f) COLLATERAL ATTACHED TO OTHER PROPERTY. In the event that
the Collateral is to be attached or affixed to any real property, the Lessee
hereby agrees that a financing statement which is a fixture filing may be filed
for record in any appropriate real estate records. If the Lessee is not the
record owner of such real property, it will provide the Secured Party with any
additional security documents or financing statements necessary for the
perfection of the Secured Party's Lien in the Collateral, as requested by the
Secured Party.
(g) LEASE. The Lease will not be amended, supplemented or
modified without the written consent of the Secured Party. All payments under
the Lease shall be made only to such account as specified by the Secured Party.
(h) MORTGAGE REMEDIES. If an Event of Default shall have
occurred, Secured Party may institute a proceeding or proceedings, judicial or
by such other statutory procedures available in the state in which the
Collateral is located, for the complete or partial foreclosure of this Mortgage
or the complete or partial sale of the Collateral under any applicable provision
of law. Mortgagee may sell the Collateral, and all estate, right, title,
interest, claim and demand of Mortgagor therein, and all rights of redemption
thereof, at one or more sales, as an entirety
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or in parcels, with such elements of real and/or personal property, and at such
time and place and upon such terms as it may deem expedient, or as may be
required by applicable law, and in the event of a sale, by foreclosure or
otherwise, of less than all of the Collateral, this Mortgage shall continue as a
lien and security interest on the remaining portion of the Collateral. Subject
to the requirements of applicable law and except as otherwise provided herein,
the following provisions shall apply to any sale or sales of all or any portion
of the Collateral under or by virtue of this subsection(h, whether made by
virtue of judicial proceedings or of a judgment or decree of foreclosure and
sale:
i) Secured Party may conduct any number of sales from time to
time.
ii) Any sale may be postponed or adjourned by public
announcement at the time and place appointed for such sale or for such
postponed or adjourned sale without further notice.
iii) After each sale, Secured Party, or an officer of any court
empowered to do so shall execute and deliver to the purchaser or
purchasers at such sale a good and sufficient instrument or instruments
granting, conveying, assigning and transferring all right, title and
interest of Lessee in and to the property and rights sold and shall
receive the proceeds of said sale or sales and apply the same as
specified in the Note. Secured Party is hereby appointed the true and
lawful attorney-in-fact of Lessee, which appointment is irrevocable and
shall be deemed to be coupled with an interest, in Secured Party's name
and stead, to make all necessary conveyances, assignments, transfers
and deliveries of the property and rights so sold, Lessee hereby
ratifying and confirming all that said attorney or such substitute or
substitutes shall lawfully do by virtue thereof. Nevertheless, Lessee,
if requested by Secured Party, shall ratify and confirm any such sale
or sales by executing and delivering to Secured Party or such purchaser
or purchasers all such instruments as may be advisable, in Secured
Party's judgment, for the purposes as may be designated in such
request.
iv) Any and all statements of fact or other recitals made in
any of the instruments referred to in SUBPARAGRAPH (III) of this
SUBSECTION (H) given by Secured Party shall be taken as conclusive and
binding against all persons as to evidence of the truth of the facts so
stated and recited.
v) Any such sale or sales shall operate to divest all of the
estate, right, title, interest, claim and demand whatsoever, whether at
law or in equity, of Lessee in and to the properties and rights so
sold, and shall be a perpetual bar both at law and in equity against
Lessee and any and all
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persons claiming or who may claim the same, or any part thereof or any
interest therein, by, through or under Lessee to the fullest extent
permitted by applicable law.
vi) Upon any such sale or sales, Secured Party may bid for and
acquire the Collateral and, in lieu of paying cash therefor, may make
settlement for the purchase price by crediting against the amounts due
under this Lease the amount of the bid made therefor, after deducting
therefrom the expenses of the sale, the cost of any enforcement
proceeding hereunder, and any other sums which Secured Party is
authorized to deduct under the terms hereof and under applicable law,
to the extent necessary to satisfy such bid.
vii) Upon any such sale, it shall not be necessary for Secured
Party or any public officer acting under execution or order of court to
have present or constructively in its possession any of the Collateral.
Secured Party may exercise its rights of enforcement under the Uniform
Commercial Code in effect in the State of Florida.
PROVIDED NEVERTHELESS, that Secured Party shall, at the expense of Lessee, cause
this Mortgage to be released upon (a) Lessee's payment in full of all amounts
secured by this Mortgage as set forth under this Section 26 and (b) Lessee's
paying and performing all other obligations of Lessee set forth in the Operative
Documents in a timely manner.
Section 27. MISCELLANEOUS.
(a) This Lease and the other Transaction Documents embody the
entire agreement and understanding between the Lessee and the Lessor and
supersede all other agreements and understandings between such parties relating
to the subject matter hereof. This written Lease and the other Transaction
Documents represent the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous, or subsequent oral
agreements of the parties. There are no unwritten oral agreements between the
parties.
(b) Notwithstanding anything to the contrary contained in this
Lease, the execution of this Lease and any other instrument or document executed
in connection herewith shall not impose upon any director, officer or employee
of the Lessee, the Agent or the Lessor personal liability for the Lessee's, the
Agent's and the Lessor's respective obligations under this Lease or any other
instrument or document executed in connection herewith; provided the foregoing
shall not relieve any such director, officer or employee of personal liability
for his or her fraud or intentional misconduct.
33
<PAGE>
(c) Captions and section headings appearing herein are
included solely for convenience of reference and are not intended to affect the
interpretation of any provision of this Agreement.
(d) This Lease and the rights and obligations of the Parties
hereto relating to the Facility shall be governed by and interpreted in
accordance with the laws of the State of New York, including Section 5-1401 of
the New York General Obligations Law (or any similar successor provision
thereto) but excluding all other conflict-of-laws rules; EXCEPT THAT, to the
extent required by the laws of the State of Florida, the laws of the State of
Florida shall govern (i) the creation and existence of this Lease, (ii) Section
26 of this Lease, and (iii) the enforcement of the rights of Lessor to repossess
the Facility from Lessee after the earlier of the termination of this Lease or
the termination of Lessee's right to possession of the Facility.
(e) Nothing in this Lease, express or implied, shall give to
any Person, other than the parties hereto and the Agent and their respective
successors and permitted assigns, any benefit or any legal or equitable right,
remedy or claim under this Lease including, without limitation, under any
provision of this Lease regarding the priority or application of any amounts
payable hereunder.
(f) This Lease may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instrument and any
of the parties hereto may execute this Agreement by signing any such
counterpart.
(g) Each of the parties hereto waives, to the fullest extent
permitted by applicable law, any right to a trial by jury in any action or
proceeding to enforce or to defend any rights under this Lease or under any
amendment, instrument, document or agreement delivered or which may in the
future be delivered in connection herewith or therewith or arising from any
relationship existing in connection with this Lease, and agrees that any such
action or proceeding shall be tried before a court and not before a jury.
(h) In the event that any one or more of the provisions
contained in this Lease shall, for any reason, be held invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of the Lease.
(i) Notwithstanding anything to the contrary contained in this
Lease or any of the Transaction Documents, the amounts which the Lessee is
obliged to pay pursuant to this Lease and the other Transaction Documents, and
the amounts which the Lessor, the Agent and the Lenders are entitled to receive
pursuant to this
34
<PAGE>
Lease and the other Transaction Documents, are subject to the limitations set
forth in Section 11.15 of the Credit Agreement.
(j) Time is of the essence in connection with the payment of
Rent and all other amounts payable hereunder and the performance of the Lessee's
other obligations hereunder.
(k) No recourse shall be had against the Lessor or its
successors and assigns and their directors, officers, shareholders, employees or
agents for any claim based on any failure by the Lessor in the performance or
observance of any of the agreements, covenants or provisions contained in this
Lease; and in the event of any such failure, recourse shall be had solely
against the rights and interests of the Lessor in the Facility.
[SIGNATURES CONTAINED ON NEXT PAGE]
35
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Lease to be executed
by their respective officers thereunto duly authorized as of the date first
above written.
LESSEE:
THE VINCAM GROUP, INC.
/s/ MICHELLE A. HICKERSON
- -------------------------------
Witness: Michelle A. Hickerson
/s/ JORGE DIAZ-SILVEIRA By:/s/ ELIZABETH J. KEELER
- ------------------------------- -------------------------------
Witness: Jorge Diaz-Silveira Name: Elizabeth J. Keeler
Title: Vice President
LESSOR:
FLEET REAL ESTATE, INC.
/s/ KATHY A. SULLIVAN
- -------------------------------
Witness: Kathy A. Sullivan
By: /s/ J.C. HART
/s/ JOHN. G. CHRISTENSEN ------------------------------
- ------------------------------- Name: J.C. Hart
Witness: John G. Christensen Title: S.V.P
36
<PAGE>
STATE OF GEORGIA ss.
ss.
COUNTY OF FULTON ss.
The foregoing instrument was acknowledged before me this 9th day of
December, 1997 by Elizabeth J. Keeler, as Vice President of The Vincam Group,
Inc., a Florida corporation, on behalf of such corporation, and he is personally
known to me or produced Driver's License as identification.
/s/ SANDRA M. MARSH
-------------------------------------
Notary Public for the State of GA
My commission expires: October 20, 2000
Sandra M. Marsh
Notary Public
Cherokee County, Georgia
Commission Expires October 20, 2000
37
<PAGE>
COMMONWEALTH OF MASSACHUSETTS ss.
ss.
COUNTY OF SUFFOLK ss.
The foregoing instrument was acknowledged before me this 5th day of
December, 1997 by J.C. Hart, as Sr. Vice President of Fleet Real Estate, Inc., a
Rhode Island corporation, on behalf of such corporation, and he is personally
known to me or produced ___________________ as identification.
/s/ CAROLINE D. HUBBARD
---------------------------------------------------
Notary Public for the Commonwealth of Massachusetts
My commission expires: June 2, 2000
Caroline D. Hubbard
Notary Public
Commission Expires June 2, 2000
38
<PAGE>
EXHIBIT A
(Description of Site)
All of FOX CROFT, according to the Plat thereof recorded in Plat Book 115, at
Page 69, of the Public Records of Dade County, Florida.
39
<PAGE>
SCHEDULE 1
Insurance Requirements
The Lessee will provide, or cause to be provided, insurance in
accordance with the terms of this Schedule, which insurance shall be placed and
maintained with Permitted Insurers.
(a) Insurance Coverages and Limits
At all times subsequent to the Completion Date, the Lessee shall
provide, or cause to be provided, the following property and liability coverages
with respect to the Facility:
(i) all-risk property coverage, with limits of coverage at
least equal to the replacement cost (which limits shall be not less
than $12,000,000 less land value for the Facility), which insurance
coverage may, at the Lessee's option, be included under any "blanket"
policy maintained by the Lessee so long as such "blanket" policy
provides for all-risk property coverage with respect to the Facility
and any other Property covered thereby, with limits of coverage at
least equal to the aggregate replacement cost of the Facility
(provided, however, that such insurance, in either case, shall provide
for replacement cost coverage, provided that the insured property is
replaced, and, provided further, that the insurance shall not have the
effect of causing the Lessee or any of its Affiliates to be deemed a
co-insurer), with respect to the Lessee and any Affiliate of the Lessee
providing services with respect to the Facility, or if the Lessee
elects to effect the coverage required by this Paragraph under a
"blanket" policy, Lessee and its Affiliates insured thereby, such
insurance to include, coverage for (x) floods, windstorms, hurricanes,
tornados, earthquakes, collapse and other perils (including debris
removal and cleanup) and such insurance to cover equipment separated
from the Facility, transit of equipment and consumables to and from the
Facility, labor claims, in each case with respect to the Facility, and
such insurance to include coverage for all other risks and occurrences
customarily included under all-risk policies available with respect to
Property similar in construction, location, occupancy and operation to
the Facility (or the Facility and all other Property insured thereby if
all are covered under a "blanket" policy), and (y) "boiler and
machinery" property damage insurance on a comprehensive basis with
respect to damage to the machinery, plants, equipment or similar
apparatus (including production machinery) included in the Facility (or
the Facility and all other Property insured thereby if all are covered
under a "blanket" policy), from
40
<PAGE>
risks and in amounts normally insured against under machinery
policies.
(ii)
(1) statutory workers' compensation and occupational
disease insurance in accordance with applicable state and
federal law, and employer's liability insurance with
primary and excess coverage limits of not less than
$1,000,000;
(2) commercial general liability insurance covering
operations of the Lessee, contractual liability coverage,
contingent liability coverage arising out of the operations
of the Facility, cross-liabilities coverage, and other
coverage for hazards customarily insured with respect to
Property similar in construction, location, occupancy and
operation to the Facility, with limits complying with the
underlying requirements of the excess liability policy
described in Paragraph (a)(ii)(3);
(3) excess commercial liability insurance in excess
of the liability policies described in Paragraphs
(a)(ii)(1) and (2) to bring to limits of not less than
$5,000,000 for each occurrence and in the aggregate per
year with respect to the Lessee and its Affiliates.
(iii) The policy or policies providing the coverage required by
paragraphs (a)(i) and (a)(ii)(2) and (a)(ii)(3) may include deductible
amounts for the account of the Lessee or its Affiliates, as the case
may be, not to exceed $1,000,000 in the aggregate for all such
coverages.
(b) Insurance Endorsements - Any insurance carried in accordance
herewith shall, except as hereinafter permitted, provide or be endorsed to
provide that:
(i) the Lessor and the Agent on behalf of the Lenders, as
their interests may appear, shall be included as additional insureds or
named as loss payees but only with respects coverages required by
Paragraphs (a)(i), with the understanding that any obligation imposed
upon the insured (including, without limitation, the liability to pay
premiums) under any policy required by this Schedule shall be the
obligation of the Lessee and its Affiliates and not that of the Lessor,
the Agent or any Lender;
(ii) except with respect to the coverage required by Paragraphs
(a)(i) and (a)(ii), there shall be a cross-liability and severability
of interest endorsement
41
<PAGE>
providing that to the extent the policy is written to cover more than
one insured, all terms, conditions, insuring agreements and
endorsements, with the exception of limits of liability and deductibles
shall operate in the same manner as if there were a separate policy
covering each insured;
(iii) the insurer thereunder waives all rights of subrogation to
the extent permitted by applicable law and to the extent available for
a commercially reasonable premium against the Lessor, the Agent or the
Lenders;
(iv) such insurance shall be primary without right of
contribution of any other insurance carried by or on behalf of the
Lessor, the Agent or the Lenders with respect to its or their interests
in the Facility; and
(v) if such insurance is canceled for any reason whatsoever
(including, without limitation, nonpayment of premium) or any material
change is made in the coverage that affects the interests of the
Lessor, the Agent or the Lenders, such cancellation or change shall not
be effective as to the Lessor, the Agent and the Lenders for 10 days
for nonpayment of premiums and otherwise for 45 days, in both cases
after receipt by the Lessor and the Agent (at the address provided
pursuant to Section 22 of the Lease) of written notice sent by
certified mail from such insurer of such cancellation or change.
(c) Adjustment of Property Losses - After the occurrence and during the
continuation of a Cancellation Event or Termination Event, the loss, if any,
under any property insurance covering the Facility required to be carried by
this Schedule shall be adjusted with the insurance companies or otherwise
collected, including, without limitation, the filing of appropriate proceedings,
by the Lessee in consultation with the Lessor and the Agent.
(d) Reinstatement of Limits - The Lessee shall, or shall cause its
insurance broker to, notify promptly the Lessor and the Agent at any time when
the limits of the excess commercial liability insurance required by Paragraph
(a)(ii)(3) shall have been reduced, either by reason of payments of, or the
establishment of reserves for the ultimate payment of, claims which have been
asserted during the term of such insurance, by an aggregate amount in excess of
$250,000. At such time, the Lessee shall, if so requested by the Lessor, use its
best efforts to reinstate such insurance so as to comply with the requisite
limits prescribed herein.
(e) Evidence of Insurance - Upon request, the Lessee will furnish the
Lessor and the Agent reasonable evidence of such insurance relating to the
Facility, as the case may be.
42
<PAGE>
(f) Additional Insurance by the Agent, the Lenders or the Lessee -
Nothing in this Schedule shall prohibit the Lessor, the Agent, any Lender or the
Lessee, as their respective interests may appear, from maintaining for its own
account, at the expense of the Person purchasing such insurance, additional
insurance on or with respect to the Facility, or any part thereof, with coverage
exceeding that otherwise required under this Schedule, unless such insurance
would conflict with or limit the insurance otherwise required under this
Schedule.
43
EXHIBIT 10.3
GUARANTY (LESSOR)
THIS GUARANTY (Lessor) (this "GUARANTY") is made as of
December 9, 1997 by THE VINCAM GROUP, INC., a Florida corporation (the
"COMPANY"), in favor of FLEET NATIONAL BANK, as Agent (the "AGENT"), for the
ratable benefit of the Lenders from time to time (the "LENDERS"), under the
Credit Agreement referred to below.
RECITALS
WHEREAS, Fleet Real Estate, Inc. (the "LESSOR") has acquired a
fee simple interest in certain real property located in Dade County, Florida(the
"SITE"), and intends to construct on the Site a corporate headquarters building
and related enhancements and improvements; and
WHEREAS, the Lessor has leased the Site, and the corporate
headquarters building and other enhancements and improvements thereon, after
completion, to the Company, as lessee, pursuant to a Lease Agreement of even
date herewith (as the same may be amended, supplemented or otherwise modified
from time to time, the "LEASE"); and
WHEREAS, in order to finance the acquisition of the Lessor's
fee simple estate in the Site and the construction of the corporate headquarters
building and related enhancements and improvements on the Site for the ultimate
use and benefit of the Company in accordance with the Lease, the Company, the
Lessor, the Agent, and the Lenders have entered into a certain Credit and
Investment Agreement of even date herewith (as the same may be amended,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT"),
whereby the Company has requested that the Lenders extend certain Loans to the
Lessor in an aggregate principal amount of up to $11,640,000, and that the
Lessor make certain Lessor Investments in an aggregate principal amount of up to
$360,000; and
WHEREAS, to induce the Agent, the Lenders and the Lessor to
enter into the Credit Agreement and other Transaction Documents, the Company has
agreed to guarantee certain obligations of the Lessor to the Agent and the
Lenders under the Credit Agreement, the Notes and the other Transaction
Documents; and
WHEREAS, the Lenders have agreed to extend the requested Loans
upon the terms and conditions set forth in the Credit Agreement;
NOW, THEREFORE, in consideration of the premises and the
covenants and agreements herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Company hereby agrees as follows:
<PAGE>
SECTION 1. DEFINITIONS. Terms defined in the Credit Agreement
or in Schedule 1.02 to the Credit Agreement and not otherwise defined herein
have, as used herein, the respective meanings provided for therein.
SECTION 2. THE GUARANTY. The Company, as primary obligor and
not merely as surety, hereby irrevocably and unconditionally guarantees (a) the
full and punctual payment (whether at stated maturity, upon acceleration or
otherwise) when due of the Loans, including, without limitation, any and all
renewals, extensions for any period, rearrangements or enlargements thereof, all
interest (pre-petition or post-petition) accruing on the Loans (pre-petition or
post-petition) and all indemnities, expenses and other amounts payable by the
Lessor to the Agent or any Lender under the Credit Agreement, the Notes and the
other Transaction Documents and (b) the punctual performance of all obligations
and agreements of the Lessor to or in favor of the Agent or the Lenders under
the Credit Agreement, the Notes and the other Transaction Documents (all of the
foregoing obligations in clauses (a) and (b) above being referred to
collectively as the "GUARANTEED OBLIGATIONS"), and agrees to pay any and all
expenses (including reasonable attorneys' fees and expenses) incurred by the
Agent and the Lenders and their respective successors, transferees and assigns
in enforcing any rights under this Guaranty (Lessor); PROVIDED that, if the
Company shall have paid the Final Rent Payment or Completion Costs Payment, as
applicable, and returned the Facility to the Lessor in accordance with Section
16 of the Lease, the Company shall have no obligation under this Guaranty
(Lessor) or otherwise to pay any portion of the principal amount of the Tranche
B Loans.
Without limiting the generality of the foregoing, the
Company's liability shall extend to all amounts that constitute part of the
Guaranteed Obligations and would be owed by the Lessor to the Agent or the
Lenders but for the fact that they are unenforceable or not allowable due to the
existence of a bankruptcy, reorganization or similar proceeding involving the
Lessor. For purposes of determining when an obligation is "due" for purposes of
this Guaranty (Lessor), such term shall be interpreted to mean due in accordance
with the terms of this Guaranty (Lessor) and without regard to the amendment,
modification or rejection of any Guaranteed Obligation in any bankruptcy or
other reorganization proceeding.
SECTION 3. GUARANTY UNCONDITIONAL. The Company guarantees that
the Guaranteed Obligations will be paid and performed strictly in accordance
with their terms, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of the
Lessor with respect thereto. The obligations of the Company under this Guaranty
are independent of the Guaranteed Obligations and a separate action or actions
may be brought and prosecuted against the Company to enforce this Guaranty
(Lessor),
2
<PAGE>
irrespective of whether any action is brought against the Lessor or any
affiliate of the Lessor or whether the Lessor or any affiliate of the Lessor is
joined in any such action or actions. The obligations of the Company hereunder
shall be irrevocable, unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged or otherwise
affected by:
a. any extension, renewal, settlement, compromise, waiver or
release in respect of any obligation of the Lessor under the
Credit Agreement, any Note or any other Transaction Document,
by operation of law or otherwise, or any obligation of any
other guarantor of any of the Guaranteed Obligations;
b. any modification or amendment of or supplement to the
Credit Agreement, any Note or any other Transaction
Document;
c. any release, nonperfection or invalidity of any direct or
indirect security for any obligation of the Lessor under the
Credit Agreement, any Note or any other Transaction Document
or any obligations of any other guarantor of any of the
Guaranteed Obligations;
d. any change in the corporate existence, structure or
ownership of the Lessor, or any other guarantor of any
of the Guaranteed Obligations, or any insolvency,
bankruptcy, reorganization or other similar proceeding
affecting the Lessor, or any other guarantor of the
Guaranteed Obligations, or its assets or any resulting
release or discharge of any obligation of the Lessor,
or any other guarantor of any of the Guaranteed
Obligations;
e. the existence of any claim, set-off or other rights
which the Company may have at any time against the
Lessor, any other guarantor of any of the Guaranteed
Obligations, the Agent, any Lender or any other Person,
whether in connection herewith or any unrelated
transactions, provided that nothing herein shall
prevent the assertion of any such claim by separate
suit or compulsory counterclaim;
f. any invalidity or unenforceability relating to or
against the Lessor, or any other guarantor of any of
the Guaranteed Obligations, for any reason related to
the Credit Agreement, any Note or any other Transaction
Document or any other guaranty of the Guaranteed
Obligations, or any provision of applicable law or
regulation purporting to prohibit the payment by the
Lessor or any other guarantor of the Guaranteed
Obligations, of amounts payable by the Lessor under the
3
<PAGE>
Credit Agreement, any Note or any other Transaction
Document; or
g. any other act or omission to act or delay of any kind
by the Lessor, any other guarantor of the Guaranteed
Obligations or any other Person or any other
circumstance whatsoever which might, but for the
provisions of this paragraph, constitute a legal or
equitable discharge of the Company's obligations
hereunder, including, without limitation, any failure,
omission, delay or inability on the part of the Agent
or the Lenders to enforce, assert or exercise any
right, power or remedy conferred on the Agent or the
Lenders under the Credit Agreement, any Note or any
other Transaction Document.
SECTION 4. DISCHARGE ONLY UPON PAYMENT IN FULL; REINSTATEMENT
IN CERTAIN CIRCUMSTANCES. The Company's obligations hereunder shall remain in
full force and effect until all Guaranteed Obligations shall have been paid in
full and the Commitments under the Credit Agreement shall have terminated or
expired. If at any time any payment of the principal of or interest on any Note
or any other amount payable by the Lessor under the Credit Agreement or any
other Transaction Document is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of the Lessor or
otherwise, the Company's obligations hereunder with respect to such payment
shall be reinstated as though such payment had been due but not made at such
time.
SECTION 5. WAIVER OF NOTICE BY THE COMPANY. The Company
irrevocably waives acceptance hereof, presentment, demand, protest and, to the
fullest extent permitted by law, any notice not provided for herein, as well as
any requirement that at any time any action be taken by any Person against the
Lessor, any other guarantor of the Guaranteed Obligations or any other Person.
SECTION 6. STAY OF ACCELERATION. If acceleration of the time
for payment of any amount payable by the Lessor under the Credit Agreement, any
Note or any other Transaction Document is stayed upon the insolvency, bankruptcy
or reorganization of the Lessor, all such amounts otherwise subject to
acceleration under the terms of the Credit Agreement, any Note or any other
Transaction Document shall nonetheless be payable by the Company hereunder
forthwith on demand by the Agent or any Lender.
SECTION 7. NOTICES. All notices and other communications
provided for hereunder shall be in writing (including by telecopier and other
readable communication) and mailed by certified mail, return receipt requested,
telecopied or otherwise transmitted or delivered: if to the Company, any Lender,
the Agent or the Lessor, at its address set forth under its name on the
signature page to the Credit Agreement; or, as to
4
<PAGE>
each party at such other address as shall be designated by such party in a
written notice to the other parties. All such notices and communications shall,
if so mailed, telecopied or otherwise transmitted, be effective when received,
if mailed, or when the appropriate answerback or other evidence of receipt is
given, if telecopied or otherwise transmitted, respectively.
SECTION 8. NO WAIVERS. No failure or delay by the Agent or the
Lenders in exercising any right, power or privilege hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies provided in this Guaranty, the Credit
Agreement, the Notes and the other Transaction Documents shall be cumulative and
shall not be exclusive of any other rights or remedies provided by law.
SECTION 9. SUCCESSORS AND ASSIGNS. This Guaranty (Lessor) is
for the benefit of the Agent and the Lenders and their successors and assigns.
In the event of an assignment of any amounts payable under the Credit Agreement,
the Notes or the other Transaction Documents, the rights hereunder, to the
extent applicable to the indebtedness so assigned, may be transferred with such
indebtedness. This Guaranty (Lessor) may not be assigned by the Company without
the prior written consent of the Agent and each Lender and shall be binding upon
the Company and its successors and permitted assigns.
SECTION 10. CHANGES IN WRITING. Neither this Guaranty (Lessor)
nor any provision hereof may be changed, waived, discharged or terminated
orally, but only in writing signed by the Company, the Agent and the Lenders.
SECTION 11. GOVERNING LAW; SUBMISSION TO JURISDICTION;
WAIVER OF JURY TRIAL. THIS GUARANTY (LESSOR) SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THE COMPANY HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND OF
ANY NEW YORK STATE COURT SITTING IN NEW YOR, NEW YORK AND FOR PURPOSES OF ALL
LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE
TRANSACTIONS CONTEMPLATED HEREBY. THE COMPANY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM
THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
THE COMPANY HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
5
<PAGE>
RELATING TO THIS GUARANTY (LESSOR) OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
SECTION 12. TAXES, ETC. All payments required to be made by
the Company hereunder shall be made without set-off or counterclaim and free and
clear of, and without deduction or withholding for or on account of, any present
or future taxes, levies, imposts, duties or other charges of whatsoever nature
imposed by any government or any political or taxing authority as required
pursuant to Section 4.06 of the Credit Agreement.
SECTION 13. SUBROGATION. The Company hereby agrees that it
will not exercise any rights which it may acquire by way of subrogation under
this Guaranty (Lessor), by any payment made hereunder or otherwise, unless and
until all of the Guaranteed Obligations shall have been paid in full. If any
amount shall be paid to the Company on account of such subrogation rights at any
time when all of the Guaranteed Obligations shall not have been paid in full,
such amount shall be held in trust for the benefit of the Agent and the Lenders
and shall forthwith be paid to the Agent to be credited and applied to the
Guaranteed Obligations, whether matured or unmatured, in accordance with the
terms of the Credit Agreement.
IN WITNESS WHEREOF, the Company has caused this Guaranty
(Lessor) to be duly executed, under seal, by its authorized officer as of the
date first above written.
[SEAL] THE VINCAM GROUP, INC., a Florida
corporation
By: /s/ ELIZABETH J. KEELER
-------------------------------
Name: Elizabeth J. Keeler
Title: Vice President
6
EXHIBIT 10.4
THIS INSTRUMENT PREPARED BY AND
AFTER RECORDING, RETURN TO:
Christopher L. Carson, Esq.
Jones, Day, Reavis & Pogue
3500 One Peachtree Center
303 Peachtree Street
Atlanta, Georgia 30308-3242
MORTGAGE, ASSIGNMENT OF LEASES
AND SECURITY AGREEMENT
THIS MORTGAGE, ASSIGNMENT OF LEASES AND SECURITY AGREEMENT (hereinafter
referred to as this "INSTRUMENT") is made and entered into this December 9,1997
by and between FLEET REAL ESTATE, INC., a Rhode Island corporation, whose
address is One Federal Street, Boston, Massachusetts 02211 ("FREI"), and The
Vincam Group, Inc., a Florida corporation (the "Company"), as parties of the
first part as mortgagor (FREI and the Company hereinafter individually, as the
context requires, and collectively, as applicable, referred to as "GRANTOR"),
and FLEET NATIONAL BANK, as Agent, whose address is 75 State Street, Boston,
Massachusetts 02109, party of the second part, as Agent (hereinafter referred to
as "Agent");
RECITALS
A. On even date herewith, the Company, FREI, the Agent and
other persons (hereinafter collectively referred to as the "LENDERS") are
executing a Credit and Investment Agreement (such agreement, as may from time to
time be amended or supplemented, hereinafter referred to as the "CREDIT
AGREEMENT") pursuant to which, upon the terms and conditions stated therein, the
Lenders agree to make loans and advances to FREI.
B. The Company has executed that certain Guaranty (Lessor) in
favor of Agent for the benefit of the Lenders of even date herewith (the
"Guaranty") guaranteeing, INTER ALIA, certain obligations of FREI to Agent and
the Lenders under the Credit Agreement, the Notes and the other Transaction
Documents.
C. The Lenders have conditioned their respective obligations
under the Credit Agreement upon the execution and delivery by Grantor of this
Instrument and Grantor has agreed to enter into this Instrument.
D. Therefore, in order to comply with the terms and conditions
of the Credit Agreement, to induce the Lenders to make loans and advances to
FREI, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Grantor hereby agrees as follows:
<PAGE>
ARTICLE I.
DEFINITIONS
Section 1.01 TERMS DEFINED ABOVE OR IN THE CREDIT AGREEMENT.
All capitalized terms used in this Agreement and not otherwise defined herein
shall have the meanings assigned to them in Schedule 1.02 of the Credit
Agreement.
Section 1.02 CERTAIN DEFINITIONS. As used in this Instrument,
the following terms shall have the following meanings, unless the context
otherwise requires:
"ASSIGNED LEASES" shall have the meaning assigned to such term
in Section 4.01.
"CONTRACTS" shall have the meaning assigned such term in
paragraph (c) of Article II.
"FACILITY" shall have the meaning assigned such term in
Article II.
"LEASE" shall mean that certain Lease Agreement entered into
on even date herewith whereby Grantor, as lessor, has leased the Facility to the
Company, as lessee, as it may be extended, renewed, amended or supplemented from
time to time.
"MORTGAGED PROPERTY" shall have the meaning assigned such term
in Article II.
"OBLIGATIONS" shall mean: (i) all of the outstanding aggregate
amount of the Loans made to the Grantor under the Credit Agreement, including
without limitation, and any and all renewals, extensions for any period,
rearrangements or enlargements thereof; (ii) the performance of all obligations
and agreements of the Grantor to the Agent or the Lenders under the Transaction
Documents; and (iii) all interest (pre-petition or post-petition), taxes,
indemnities, losses, compensation, reimbursement, charges, expenses, attorneys'
or other fees and any other sums payable to or incurred by either the Agent or
any of the Lenders in connection with the execution, administration or
enforcement of their rights and remedies hereunder or any other Transaction
Documents.
"RENTS" shall mean all of the rents, revenues, income,
proceeds, profits, security and other types of deposits, and other benefits paid
or payable by parties to the Assigned Leases other than Grantor for using,
leasing, licensing, possessing, operating from, residing in or otherwise
enjoying the Mortgaged Property.
"SITE" shall mean the real property located in Dade County,
Florida and all rights appurtenant to such real property
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and air rights, all as described in greater detail in Exhibit "A" attached
hereto and by this reference incorporated herein.
ARTICLE II.
GRANTING CLAUSES
In order to secure the payment and performance of the Obligations and
any other obligations of Grantor hereinafter set forth, Grantor does hereby
mortgage, give, pledge, grant, bargain, sell, convey, assign, transfer and set
over unto Agent, for the ratable benefit of the Lenders, and the successors and
assigns of Agent all of the following described land and interests in land,
estates, easements, rights, improvements, property, fixtures, equipment,
furniture, furnishings, appliances and appurtenances, whether now owned by
Grantor or hereafter acquired and whether the same now exist or hereafter come
into existence (hereinafter collectively referred to as the "MORTGAGED
PROPERTY"):
(a) Grantor's fee simple interest in and to the Site and all Grantor's
right, title and interest in and to the Lease; PROVIDED, however, that if
Grantor's interest in the Site or any other part of the Facility is
recharacterized as a security title or security interest due to the
recharacterization of the Lease as a financing transaction (rather than a true
lease), this subsection (a) shall be deemed to serve as a conveyance by Grantor
to Agent of all Grantor's security title interest and security interest in the
Site and all other parts of the Facility acquired pursuant to, and an assignment
by Grantor to Agent of Grantor's rights under and interest in, the Lease; and
(b) All buildings, structures and improvements of every nature
whatsoever now or hereafter situated on the Site, and all gas and electric
fixtures, radiators, heaters, engines and machinery, boilers, ranges, elevators
and motors, plumbing and heating fixtures, carpeting and other floor coverings,
washers, dryers, water heaters, mirrors, mantels, air conditioning apparatus,
refrigerating plants, refrigerators, cooking apparatus and appurtenances, window
screens, awnings and storm sashes, which are or shall be attached to said
buildings, structures or improvements and all other furnishings, furniture,
fixtures, machinery, equipment, appliances, vehicles and personal property of
every kind and nature whatsoever now or hereafter owned by Grantor and located
in, on or about, or used or intended to be used with or in connection with the
use, operation or enjoyment of the Mortgaged Property, including all extensions,
additions, improvements, betterments, renewals and replacements of any of the
foregoing and all the right, title and interest of Grantor in any such
furnishings, furniture, fixtures, machinery, equipment, appliances, vehicles and
personal property subject to or covered by any prior security agreement,
conditional sales contract, chattel mortgage or similar lien or claim, together
with the
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benefit of any deposits or payments now or hereafter made by Grantor or on
behalf of Grantor, all trade-names, trademarks, service marks, logos and
goodwill related thereto which in any way now or hereafter belong, relate or
appertain to the Mortgaged Property or any part thereof or are now or hereafter
acquired by Grantor (excluding trademarks or tradenames which appertain to the
operation of Grantor's business rather than the operation of the Facility); and
all inventory, accounts, chattel paper, documents, equipment, fixtures, farm
products, consumer goods and general intangibles constituting proceeds acquired
with cash proceeds of any of the property described hereinabove, and all
insurance proceeds, all of which are hereby declared and shall be deemed to be
fixtures and accessions to the freehold and a part of the Mortgaged Property as
between the parties hereto and all persons claiming by, through or under them,
and which shall be deemed to be a portion of the security for the Obligations
and to be secured by this Instrument; PROVIDED, HOWEVER, that the term
"Mortgaged Property" shall not include any of the Excluded Equipment. The
location of the above described collateral is also the location of the Site. The
property described in this subsection (b) is herein referred to collectively as
the "IMPROVEMENTS"; the Improvements and the Site are herein collectively
referred to as the "FACILITY."
(c) All of Grantor's right, title and interest, under, in and to all
contracts, franchises, licenses, agreements, permits and other documents,
including but not limited to those more particularly described in EXHIBIT "C"
attached hereto and made a part hereof, together with any additions or changes
to and any extensions, revisions or modifications of all such contracts,
franchises, licenses, agreements, permits and other documents , whether now
existing or hereafter entered into in relating to the development, ownership,
maintenance and operation of the Facility, and including without limitation, all
Related Contracts and all right, title and interest of Grantor in, to and under
the Credit Agreement, the Agency Agreement, the Pledge Agreement and the
Guaranty (Lessee)(all of the foregoing being, collectively, the "CONTRACTS"),
and all proceeds of any of the Contracts, including, without limitation, all
insurance proceeds; and
(d) All easements, rights-of-way, strips and gores of land, vaults,
streets, ways, alleys, passages, sewer rights, waters, water courses, water
rights and powers, and all estates, rights, titles, interests, privileges,
liberties, tenements, hereditaments and appurtenances whatsoever, in any way
belonging, relating or appertaining to the Mortgaged Property or any part
thereof, or which hereafter shall in any way belong, relate or be appurtenant
thereto, whether now owned or hereafter acquired by Grantor and the reversion
and reversions, remainder and remainders, of the Mortgaged Property from time to
time accruing.
TO HAVE AND TO HOLD the Mortgaged Property and all parts, rights,
members and appurtenances thereof, to the use, benefit and behoof of Agent and
the successors and assigns of Agent, IN FEE SIMPLE forever; and Grantor
covenants that Grantor is
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lawfully seized and possessed of the Mortgaged Property as aforesaid, and has
good right to convey the same, that the same is unencumbered except for those
matters expressly set forth in EXHIBIT "B" attached hereto and by this reference
incorporated herein, and that Grantor does warrant and will forever defend the
title thereto against the claims of all persons whomsoever, except as to those
matters set forth in said EXHIBIT "B" attached hereto.
PROVIDED NEVERTHELESS, that Agent shall, at the expense of Grantor,
cause this Instrument to be released upon (a) FREI's payment in full of all
principal, interest and other sums (including, without limitation, any
prepayment fees and premiums) due and payable under the Notes, as the Notes may
from time to time be extended, renewed or modified, (b) the Company's payment in
full of any and all amounts due and payable under the Guaranty, as the Guaranty
may from time to time be renewed or modified, (c) Grantor's payment in full, at
the times demanded by Agent and with interest thereon at the same rate specified
in the Notes, of all sums advanced by Agent to protect the lien of this
Instrument, to pay taxes on the Mortgaged Property, to pay insurance premiums,
to pay principal and interest on any indebtedness secured by mortgage deed of
trust, lien or charge on the Mortgaged Property (whether prior to, or
subordinate to, or of equal priority with the lien hereof), to pay expenses and
attorneys' fees herein provided for and for any other purpose for which Agent is
authorized to disburse funds hereunder and (d) Grantor's paying and performing
all other obligations of Grantor set forth in this Instrument and in all of the
other Transaction Documents.
This conveyance is intended to operate and is to be construed as a
mortgage on the Mortgaged Property to Agent and is made under those provisions
of the existing laws of the State of Florida relating to mortgages, and is given
to secure the payment and performance by Grantor of its Obligations under the
Transaction Documents, including without limitation the following:
(i) The debt evidenced by the Notes, as the same may be
amended, modified or assigned from time to time executed by Grantor, payable to
the order of the Lenders comprising the holders thereof, representing an
aggregate indebtedness in the amount of $11,640,000; and
(ii) Any and all additional advances made by Agent to protect
or preserve the Mortgaged Property or the lien hereof on the Mortgaged Property,
or for taxes, assessments or insurance premiums as hereinafter provided (whether
or not the original Grantor remains the owner of the Mortgaged Property at the
time of such advances).
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ARTICLE III.
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 3.01 REPRESENTATIONS, WARRANTIES. Grantor hereby represents
and warrants as follows:
(a) FIRST PRIORITY LIEN. This Instrument is, and always will
be kept, a direct first security title on the real property comprising the
Mortgaged Property and a direct first security interest upon the personal
property comprising the Mortgaged Property and Grantor will not create or suffer
to be created or permit to exist any lien, security interest or charge prior or
junior to or on parity with the lien and security interest of this Instrument
upon the Mortgaged Property or any part thereof or upon the rents, issues,
revenues, profits or other income therefrom.
(b) ASSIGNED LEASES. Grantor will observe and perform all the
obligations imposed upon the Grantor under the Assigned Leases and not to do or
permit to be done anything to impair the security thereof.
(c) FURTHER ASSURANCES. Grantor will execute and deliver all
such further instruments and do such further acts as may be necessary or
desirable or as may be reasonably requested by the Agent to carry out more
effectively the purposes of this Instrument and to subject to the lien created
hereby any properties, rights and interests covered or intended to be covered
hereby.
(d) RIGHTS OF AGENT. Grantor agrees that if Grantor fails to
perform any act or to take any action which Grantor is required to perform or
take hereunder or under the Credit Agreement or any other Transaction Document
or to pay any money which Grantor is required to pay hereunder or thereunder, if
such act or action is not taken or such payment is not made by the Grantor
within 5 Business Days after notice from the Agent, the Agent in Grantor's name
or its own name may, but shall not be obligated to, perform or cause to be
performed such act or take such action or pay such money, and any expenses so
incurred by the Agent and any money so paid by the Agent (or the Lenders) shall
be a demand obligation owing by Grantor to the Agent and, upon making such
payment, shall be subrogated to all of the rights of the Person receiving such
payment. Each amount due and owing by Grantor under this Section 3.01(d) shall
bear interest from the date of such expenditure or payment or other occurrence
which gives rise to such amount being owed to the Agent until paid at the
Default Rate, and all such amounts together with such interest thereon shall be
a part of the Obligations and shall be secured by this Instrument.
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ARTICLE IV.
ASSIGNMENT OF ASSIGNED LEASES
4.01 ASSIGNMENT OF ASSIGNED LEASES AND RENTS. As additional collateral
and further security for the Obligations, Grantor does hereby assign to Agent
Grantor's interest in any and all leases, subleases, tenant contracts, rental
agreements, occupancy agreement or agreements of a similar nature, now or
hereafter affecting the Property, or any part thereof, including without
limitation the Lease (hereinafter collectively, referred to as the "ASSIGNED
LEASES") and Grantor agrees to execute and deliver to Agent such additional
instruments, in form and substance satisfactory to Agent, as may hereafter be
requested by Agent further to evidence and confirm said assignment; provided,
however, that acceptance of any such assignment shall not be construed as a
consent by Agent to any Assigned Lease, or to impose upon Agent any obligation
with respect thereto.
4.02 NO ASSIGNMENT. Grantor shall not execute an assignment of the
Assigned Leases or the income, rents, issues or profits, or any part thereof,
from the Mortgaged Property.
4.03 FUTURE LEASES. Notwithstanding any other provisions of this
Instrument, Grantor shall not hereafter enter into any Assigned Lease without
the prior written consent of Agent and except upon the following conditions: (a)
each such instrument shall contain a provision that the rights of the parties
thereunder are expressly subordinate to all of the rights and title of Agent
under this Instrument; (b) any such instrument shall contain a provision whereby
the parties thereunder expressly recognize and agree that, notwithstanding such
subordination, Agent may sell the Mortgaged Property in the manner provided in
herein, and thereby, at the option of Agent, sell the same subject to such
instrument; and (c) at or prior to the time of execution of any such instrument,
Grantor shall, as a condition to such execution, procure from the other party or
parties thereto an agreement in favor of Agent, in form and substance
satisfactory to Agent, under which such party or parties agree to be bound by
the provisions of this Instrument, regarding the manner in which Agent may
foreclose or exercise the power of sale under this Instrument.
4.04 AGENT'S AUTHORITY. The Agent is fully authorized to receive and
receipt for said revenues and proceeds; to endorse and cash any and all checks
and drafts payable to the order of Grantor or the Agent for the account of
Grantor received from or in connection with said revenues or proceeds and apply
the proceeds thereof to the payment of the Obligations, when received,
regardless of the maturity of any of the Obligations, or any installment
thereof; and to execute transfer and division orders in the name of Grantor, or
otherwise, with warranties binding Grantor. The Agent shall not be liable for
any delay, neglect, or failure to effect collection of any proceeds or to
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take any other action in connection therewith or hereunder; but shall have the
right, at its election, in the name of Grantor or otherwise, to prosecute and
defend any and all actions or legal proceedings deemed advisable by the Agent in
order to collect such funds and to protect the interests of the Agent and/or
Grantor, with all costs, expenses and attorney's fees incurred in connection
therewith being paid by Grantor.
4.05 CUMULATIVE RIGHTS. The rights provided in this Article IV shall be
cumulative of all other security of any and every character now or hereafter
existing to secure payment of the Obligations.
ARTICLE V.
SECURITY AGREEMENT
5.01 SECURITY INTEREST. Insofar as the machinery, apparatus, equipment,
fittings, fixtures, building supplies and materials, general intangibles
(including without limitation, the Contracts) and articles of personal property
either referred to or described in this Instrument, or in any way connected with
the use and enjoyment of the Mortgaged Property is concerned, this Instrument is
hereby made and declared to be a security agreement, encumbering each and every
item of personal property included herein, in compliance with the provisions of
the Uniform Commercial Code as enacted in the State of Florida. A financing
statement or statements reciting this Instrument to be a security agreement,
affecting all of said personal property aforementioned, shall be executed by
Grantor and Agent and appropriately filed, The remedies for any violation of the
covenants, terms and conditions of the security agreement herein contained shall
be (i) as prescribed herein, or (ii) as prescribed by general law, or (iii) as
prescribed by the specific statutory consequences now or hereafter enacted and
specified in said Uniform Commercial Code, all at Agent's sole election. Grantor
and Agent agree that the filing of such financing statement(s) in the records
normally having to do with personal property shall never be construed as in
anywise derogating from or impairing this declaration and hereby stated
intention of Grantor and Agent that everything used in connection with the
production of income from the Mortgaged Property and/or adapted for use therein
and/or which is described or reflected in this Instrument, is, and at all times
and for all purposes and in all proceedings both legal or equitable shall be,
regarded as part of the real estate irrespective of whether (i) any such item is
physically attached to the improvements, (ii) serial numbers are used for the
better identification of certain items capable of being thus identified in a
recital contained herein, or (iii) any such item is referred to or reflected in
any such financing statement(s) so filed at any time. Similarly, the mention in
any such financing statement(s) of the rights in and to (aa) the proceeds of any
fire and/or hazard insurance policy, or (bb) any
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award in eminent domain proceedings for a taking or for loss of value, or (cc)
Grantor's interest as lessor in any present or future lease or rights to income
growing out of the use and/or occupancy of the Mortgaged Property, whether
pursuant to lease or otherwise, shall never be construed as in anywise altering
any of the rights of Agent as determined by this instrument or impugning the
priority of Agent's lien granted hereby or by any other recorded document, but
such mention in such financing statement(s) is declared to be for the protection
of Agent in the event any court shall at any time hold with respect to the
foregoing (aa), (bb) or (cc), that notice of Agent's priority of interest to be
effective against a particular class of persons, must be filed in the Uniform
Commercial Code records.
5.02 DEBTOR'S WARRANTIES. Grantor warrants that (i) Grantor's (that is,
"Debtor's") name, identity or corporate structure and residence or principal
place of business are as set forth in Section 5.03 hereof; (ii) Grantor (that
is, "Debtor") has been using or operating under said name, identity or corporate
structure without change for the time period set forth in Section 5.03 hereof;
and (iii) the location of the collateral is upon the Site. Grantor covenants and
agrees that Grantor will furnish Agent with notice of any change in the matters
addressed by clauses (i) or (iii) of this Section 5.03 within thirty (30) days
of the effective date of any such change and Grantor will promptly execute any
financing statements or other instruments deemed necessary by Agent to prevent
any filed financing statement from becoming misleading or losing its perfected
status.
5.03 DEBTOR INFORMATION. The information contained in this Section
5.03 is provided in order that this Instrument shall comply with the
requirements of the Uniform Commercial Code, as enacted in the State of Florida,
for instruments to be filed as financing statements. The names of the "Debtor"
and the "Secured Party," the identity or corporate structure and residence or
principal place of business of "Debtor," and the time period for which "Debtor"
has been using or operating under said name and identity or corporate structure
without change, are as set forth in Schedule I of EXHIBIT "D" attached hereto
and by this reference made a part hereof, the mailing address of the "Secured
Party" from which information concerning the security interest may be obtained,
and the mailing address of "Debtor", are as set forth in Schedule 2 of said
EXHIBIT "D" attached hereto; and a statement indicating the types, or describing
the items, of collateral is set forth hereinabove.
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ARTICLE VI.
DEFAULT AND REMEDIES
6.01 EVENT OF DEFAULT. The occurrence of any "Event of Default," as
defined in the Credit Agreement, shall constitute an "Event of Default"
hereunder.
6.02 REMEDIES.
(a) The provisions of this Section 6.02)(a) shall be
enforceable to the fullest extent permitted by law. If an Event of Default shall
have occurred and be continuing, Grantor upon demand of Agent, shall forthwith
surrender to Agent the actual possession of the Mortgaged Property and if, and
to the extent, permitted by law, Agent itself, or by such officers or agents as
it may appoint, may enter and take possession of all the Mortgaged Property
without the appointment of a receiver, or an application therefor, and may
exclude Grantor and its agents and employees wholly therefrom, and may have
joint access with Grantor to the books, papers and accounts of Grantor
pertaining to the Mortgaged Property. If Grantor shall for any reason fail to
surrender or deliver the Mortgaged Property or any part thereof after such
demand by Agent, Agent may obtain a judgment or decree conferring upon Agent the
right to immediate possession or requiring Grantor to deliver immediate
possession of the Mortgaged Property to Agent, to the entry of which judgment or
decree Grantor hereby specifically consents. Upon every such entering upon or
taking of possession, Agent may hold, store, use, operate, manage and control
the Mortgaged Property and conduct the business thereof, and, from time to time
(i) make all necessary and proper maintenance, repairs, renewals, replacements,
additions, betterments and improvements thereto and thereon and purchase or
otherwise acquire additional fixtures, personalty and other property; (ii)
insure or keep the Mortgaged Property insured; (iii) manage and operate the
Mortgaged Property and exercise all the rights and powers of Grantor to the same
extent as Grantor could in its own name or otherwise with respect to the same;
and (iv) enter into any and all agreements with respect to the exercise by
others of any of the powers herein granted Agent, all as Agent from time to time
may determine to be in its best interest. Agent may collect and receive all the
rents, issues, profits and revenues from the Mortgaged Property, including those
past due as well as those accruing thereafter, and, after deducting (aa) all
expenses of taking, holding, managing and operating the Mortgaged Property
(including compensation for the services of all persons employed for such
purposes); (bb) the cost of all such maintenance, repairs, renewals,
replacements, additions, betterments, improvements, purchases and acquisitions;
(cc) the cost of such insurance; (dd) such taxes, assessments and other similar
charges as Agent may at its option pay; (ee) other proper charges upon the
Mortgaged Property or any part thereof; and (ff) the reasonable compensation,
expenses and disbursements of the attorneys and
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agents of Agent, Agent shall apply the remainder of the monies and proceeds so
received by Agent in accordance with the terms of the Credit Agreement. Anything
in this Paragraph 6.02(a) to the contrary notwithstanding, Agent shall not be
obligated to discharge or perform the duties of a landlord to any tenant or
incur any liability as a result of the exercise by Agent of its rights under
this Instrument, and Agent shall be liable to account only for the rents,
income, issues, profits and revenues actually received by Agent. Whenever all
that is due upon such interest, deposits and principal installments and under
any of the terms, covenants, conditions and agreements of this Instrument, shall
have been paid and all Events of Default made good, Agent shall surrender
possession of the Mortgaged Property to Grantor, its successors or assigns. The
same right of taking possession, however, shall exist if any subsequent Event of
Default shall occur and be continuing. In connection with any action taken by
the Agent pursuant to this Section 6.02(a), the Agent shall not be liable for
any loss sustained by Grantor resulting from any act or omission of the Agent in
administering, managing, operating or controlling the Mortgaged Property,
including a loss arising from the ordinary negligence of the Agent, unless such
loss is caused by its own gross negligence or willful misconduct and bad faith,
nor shall the Agent be obligated to perform or discharge any obligation, duty or
liability of Grantor. Grantor hereby assents to, ratifies and confirms any and
all actions of the Agent with respect to the Mortgaged Property taken under this
Section 6.02(a).
(b) If an Event of Default shall have occurred and be
continuing, Agent, upon application to a court of competent jurisdiction, shall
be entitled as a matter of strict right without notice and without regard to the
occupancy or value of any security for the Obligations secured hereby or the
solvency of any party bound for its payment, to the appointment of a receiver to
take possession of and to operate the Mortgaged Property and to collect and
apply the rents, issues, profits and revenues thereof. The receiver shall have
all of the rights and powers permitted under the laws of the state wherein the
Site is situated. Any money advanced by the Agent in connection with any such
receivership shall be a demand obligation (which obligation Grantor hereby
expressly promises to pay) owing by Grantor to the Agent and shall bear interest
from the date of making such advance by the Agent until paid at the Default
Rate.
(c) If an Event of Default shall have occurred, Agent may, in
addition to and not in abrogation of the rights covered under Section 6.02,
either with or without entry or taking possession as herein provided or
otherwise, proceed by a suit or suits in law or in equity or by any other
appropriate proceeding or remedy (i) to enforce payment and performance of the
Obligations or the performance of any term, covenant, condition or agreement of
this Instrument or any other right, or to recover damages for the breach of any
such provisions, and (ii) to pursue any other remedy available to it, all as
Agent at its sole discretion shall elect.
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(d) Agent may institute a proceeding or proceedings, judicial
or by such other statutory procedures available in the state in which the
Mortgaged Property is located, for the complete or partial foreclosure of this
Instrument or the complete or partial sale of the Mortgaged Property under any
applicable provision of law. Agent may sell the Mortgaged Property, and all
estate, right, title, interest, claim and demand of Grantor therein, and all
rights of redemption thereof, at one or more sales, as an entirety or in
parcels, with such elements of real and/or personal property, and at such time
and place and upon such terms as it may deem expedient, or as may be required by
applicable law, and in the event of a sale, by foreclosure or otherwise, of less
than all of the Mortgaged Property, this Instrument shall continue as a lien and
security interest on the remaining portion of the Mortgaged Property. Upon any
foreclosure sale:
(i) Agent may bid for and purchase the Mortgaged
Property and shall be entitled to apply all or any part of the
Obligations secured hereby as a credit to the purchase price;
(ii) the proceeds of said sale shall be applied,
first, to the expenses of such sale and of all proceedings in connection
therewith, including attorney's and trustee's fees, then to insurance premiums,
liens, assessments, taxes and charges including utility charges advanced by
Agent, then to the repayment of remaining Obligations in such amount and in the
order set forth in the Credit Agreement, and finally the remainder, if any,
shall be paid to Grantor or to the person or entity lawfully entitled to same;
and
(iii) Grantor shall be deemed a tenant holding
over and shall forthwith deliver possession to the purchaser or purchasers at
such sale or be summarily dispossessed according to provisions of law applicable
to tenants holding over.
(e) Grantor agrees to the full extent permitted by law, that
in case of the occurrence of an Event of Default, neither Grantor nor anyone
claiming through or under it shall or will set up, claim or seek to take
advantage of any appraisement, valuation, stay, extension, homestead, exemption
or redemption laws now or hereafter in force, in order to prevent or hinder the
enforcement or foreclosure of this Instrument, or the absolute sale of the
Mortgaged Property, or the final and absolute putting into possession thereof,
immediately after such sale, of the purchasers thereat, and Grantor, for itself
and all who may at any time claim through or under it, hereby waives to the full
extent that it may lawfully so do, the benefit of all such laws, and any and all
right to have the assets comprised in the security intended to be created hereby
marshaled upon any foreclosure of the lien hereof.
(f) Grantor hereby acknowledges the right to accelerate the
Obligations evidenced by the Notes upon the occurrence of an Event of Default.
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(g) Agent, at its option, is authorized to foreclose this
Instrument subject to the rights of any tenants of the Mortgaged Property, and
the failure to make any such tenants parties to any such foreclosure proceedings
and to foreclose their rights will not be, nor be asserted to be by Grantor, a
defense to any proceedings instituted by Agent to collect the Obligations.
(h) In case Agent shall have proceeded to enforce any right,
power or remedy under this Instrument by foreclosure, entry or otherwise or in
the event Agent commences advertising of the intended exercise of the sale under
power provided hereunder, and such proceeding or advertisement shall have been
withdrawn, discontinued or abandoned for any reason, or shall have been
determined adversely to Agent, then in every such case (i) Grantor and Agent
shall be restored to their former positions and rights, (ii) all rights, powers
and remedies of Agent shall continue as if no such proceeding had been taken,
(iii) each and every Event of Default declared or occurring prior or subsequent
to such withdrawal, discontinuance or abandonment shall and shall be deemed to
be a continuing Event of Default and (iv) neither this Instrument, nor the
Notes, nor the Obligations, nor any other instrument concerned therewith, shall
be or shall be deemed to have been reinstated or otherwise affected by such
withdrawal, discontinuance or abandonment; and Grantor hereby expressly waives
the benefit of any statute or rule of law now provided, or which may hereafter
be provided, which would produce a result contrary to or in conflict with the
above.
(i) No right, power or remedy conferred upon or reserved to
Agent by this Instrument is intended to be exclusive of any other right, power
or remedy, but each and every such right, power and remedy shall be cumulative
and concurrent and shall be in addition to any other right, power and remedy
given hereunder or now or hereafter existing at law or in equity or by statute.
(j) No delay or omission of Agent or of any holder of the Note
to exercise any right, power or remedy accruing upon any default shall exhaust
or impair any such right, power or remedy or shall be construed to be a waiver
of any such default, or acquiescence therein; and every right, power and remedy
given by this Instrument to Agent may be exercised from time to time and as
often as may be deemed expedient by Agent. No consent or waiver, expressed or
implied, by Agent to or of any breach or default by Grantor in the performance
of the obligations thereof hereunder shall be deemed or construed to be a
consent or waiver to or of any other breach or default in the performance of the
same or any other obligations of Grantor hereunder. Failure on the part of Agent
to complain of any act or failure to act or to declare an Event of Default,
irrespective of how long such failure continues, shall not constitute a waiver
by Agent of its rights hereunder or impair any rights, powers or remedies of
Agent consequent on any breach or default by Grantor.
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(k) If Agent (i) grants forbearance or an extension of time
for the payment of any sums secured hereby; (ii) takes other or additional
security for the payment of any sums secured hereby; (iii) waives or does not
exercise any right granted herein or in the Transaction Documents; (iv) releases
any part of the Mortgaged Property from the lien of this Instrument or otherwise
changes any of the terms, covenants, conditions or agreements of this Instrument
or any other Transaction Document; (v) consents to the filing of any map, plat
or replat affecting the Mortgaged Property; (vi) consents to the granting of any
easement or other right affecting the Mortgaged Property; or (vii) makes or
consents to any agreement subordinating the lien hereof, any such act or
omission shall not release, discharge, modify, change or affect the original
liability under this Instrument or any other of the Transaction Documents or any
other obligation of Grantor or any subsequent purchaser of the Mortgaged
Property or any part thereof, or any maker, co-signer, endorser, surety or
guarantor; nor shall any such act or omission preclude Agent from exercising any
right, power or privilege herein granted or intended to be granted in the event
of any default then made or of any subsequent default; nor, except as otherwise
expressly provided in an instrument or instruments executed by Agent, shall the
lien of this Instrument be altered thereby. In the event of the sale or transfer
by operation of law or otherwise of all or any part of the Mortgaged Property,
Agent, without notice, is hereby authorized and empowered to deal with any such
vendee or transferee with reference to the Mortgaged Property or the Obligations
secured hereby, or with reference to any of the terms, covenants, conditions or
agreements hereof, as fully and to the same extent as it might deal with the
original parties hereto and without in any way releasing or discharging any
liabilities, obligations or undertakings.
(l) Agent shall have power (a) to institute and maintain such
suits and proceedings as it may deem expedient to prevent any impairment of the
Mortgaged Property by any acts which may be unlawful or any violation of this
Instrument, (b) to preserve or protect its interest in the Mortgaged Property
and in the rents, issues, profits and revenues arising therefrom, and (c) to
restrain the enforcement of or compliance with any legislation or other
governmental enactment, rule or order that may be unconstitutional or otherwise
invalid, if the enforcement of or compliance with such enactment, rule or order
would impair the security hereunder or be prejudicial to the interest of Agent.
(m) In the case of any receivership, insolvency, bankruptcy,
reorganization, arrangement, adjustment, composition or other proceedings
affecting Grantor, its creditors or its property, Agent, to the extent permitted
by law, shall be entitled to file such proofs of claim and other documents as
may be necessary or advisable in order to have the claims of Agent allowed in
such proceedings for the entire amount due and payable by Grantor under this
Instrument at the date of the institution
14
<PAGE>
of such proceedings and for any additional amount which may become due and
payable by Grantor hereunder after such date.
(n) Grantor expressly acknowledges and agrees that upon or any
time after the occurrence and continuation of an Event of Default so long as
such Event of Default remains uncured, Agent's right, title and interest in and
to the Assigned Leases and Rents shall be and remain absolute and inviolate in
accordance with the provisions of this Instrument. Moreover, without limiting,
altering, affecting or impairing in any manner or to any extent the absolute
right, title and interest of Agent as provided herein, upon the occurrence and
continuation of an Event of Default so long as such Default remains uncured,
Agent shall have the complete right, power and authority hereunder, then or
thereafter, to exercise and enforce any or all of the following rights and
remedies, in addition to (but not in lieu of) the remedies set forth in the
other Security Instruments:
(i) without taking possession of the Mortgaged
Property, in Grantor's own name, to demand, collect, receive, sue for, attach
and levy on the Rents and give proper receipts, releases and acquittances
therefor, and after deducting all necessary and proper costs and expenses of
operation and collection, as reasonably determined by Agent, including without
limitation reasonable attorneys' fees, and apply the net proceeds thereof,
together with any funds of Grantor deposited with Agent, in reduction or
repayment of the Obligations, and any such net proceeds actually received by
Agent shall be treated as a pro tanto reduction or repayment of the Obligations
(it being specifically agreed that the mere existence of this absolute
assignment shall not be treated as pro tanto discharge, credit, reduction or
repayment or discharge of the Obligations); and
(ii) Without regard to the adequacy of the
security, with or without any action or proceeding through any Person or by any
agent, or by a receiver to be appointed by a court of competent jurisdiction,
and irrespective of the Grantor's possession, to enter upon, take possession of,
manage and operate the Mortgaged Property or any part thereof as Agent deems to
be prudent and reasonable under the circumstances; make, modify, enforce, cancel
or accept surrender of any Assigned Leases now in effect or hereafter in effect
on the Mortgaged Property or any part thereof; remove and evict any sublessee;
increase or decrease Rents; decorate, clean, repair, and make such improvements,
alterations and additions as the Agent shall deem necessary or desirable; and
otherwise do any act or incur any cost or expense which the Agent may deem
reasonably necessary to protect the status and value of the Mortgaged Property
as fully and to the same extent as Grantor could do if Grantor was in possession
thereof; and in such event, to apply the Rents so collected in accordance with
the provisions of this Instrument.
15
<PAGE>
ARTICLE VII.
MISCELLANEOUS
7.01 FURTHER ASSURANCES; AFTER ACQUIRED MORTGAGED PROPERTY. At any
time, and from time to time, upon request by Agent, Grantor will make, execute
and deliver or cause to be made, executed and delivered, to Agent and, where
appropriate, cause to be recorded and/or filed and from time to time thereafter
to be re-recorded and/or refiled at such time and in such offices and places as
shall be deemed desirable by Agent, any and all such other and further deeds to
secure debt, security agreements, financing statements, continuation statements,
instruments of further assurance, certificates and other documents as may, in
the opinion of Agent, be necessary or desirable in order to effectuate,
complete, or perfect, or to continue and preserve (a) the obligations of Grantor
under the Notes and under this Instrument and (b) the lien of this Instrument as
a first and prior lien upon and security title in and to all of the Mortgaged
Property, whether now owned or hereafter acquired by Grantor, and is free and
clear of all encumbrances, other then Permitted Encumbrances. Upon any failure
by Grantor so to do, Agent may make, execute, record, file, rerecord and/or
refile any and all such deeds to secure debt, security agreements, financing
statements, continuation statements, instruments, certificates, and documents
for and in the name of Grantor and Grantor hereby irrevocably appoints Agent the
agent and attorney-in-fact of Grantor so to do. The lien hereof will
automatically attach, without further act, to all after acquired property
attached to and/or used in the operation of the Mortgaged Property or any part
thereof.
7.02 SUBROGATION. To the full extent of the Obligations, the Agent is
hereby subrogated to the liens, claims and demands, and to the rights of the
owners and holders of each and every lien, claim, demand and other encumbrance
on the Mortgaged Property which is paid or satisfied, in whole or in part, out
of the proceeds of the Indebtedness, and the respective liens, claims, demands
and other encumbrances shall be, and each of them is hereby, preserved and shall
pass to and be held by Agent as additional collateral and further security for
the Obligations, to the same extent they would have been preserved and would
have been passed to and held by Agent had they been duly and legally assigned,
transferred, set over and delivered unto Agent by assignment, notwithstanding
the fact that any instrument providing public notice of the same may be
satisfied and canceled of record.
7.03 LIMIT OF VALIDITY. If from any circumstances whatsoever
fulfillment of any provision of this Instrument or of the Notes or of any other
Transaction Document, at the time performance of such provision shall be due,
shall involve transcending the limit of validity presently prescribed by any
applicable usury statute
16
<PAGE>
or any other applicable law, with regard to obligations of like character and
amount, then ipso facto the obligation to be fulfilled shall be reduced to the
limit of such validity, so that in no event shall any exaction be possible under
this Instrument or under the Notes that is in excess of the current limit of
such validity, but such obligation shall be fulfilled to the limit of such
validity. The provisions of this Paragraph 7.03 shall control every other
provision of this Instrument and of the Notes.
7.04 INVALIDITY. If any provision hereof is invalid or unenforceable in
any jurisdiction, the other provisions hereof shall remain in full force and
effect in such jurisdiction and the remaining provisions hereof shall be
liberally construed in favor of the Agent in order to effectuate the provisions
hereof, and the invalidity or unenforceability of any provision hereof in any
jurisdiction shall not affect the validity or enforceability of any such
provision in any other jurisdiction. If any part of the secured Obligations
cannot be lawfully secured by this Instrument or if any part of the Mortgaged
Property cannot be lawfully subject to the lien and security interest hereof to
the full extent of such Obligations, then all payments made shall be applied on
said Obligations first in discharge of that portion thereof which is not secured
by this Instrument.
7.05 CONSTRUCTION; GOVERNING LAW. This instrument may be construed as a
mortgage, chattel mortgage, conveyance, assignment, security agreement, pledge,
financing statement, hypothecation or contract, or any one or more of them, in
order fully to effectuate the security title and lien hereof and the purposes
and agreements herein set forth. The term "Grantor" as used herein shall mean
and include all and each of the individuals, partnerships, corporations or other
legal entities or persons executing this Instrument. The number and gender of
pronouns used in referring to Grantor shall be construed to mean and correspond
with the number and gender of the individuals, partnerships, corporations or
other legal entities or persons executing this Instrument as Grantor. The terms
used to designate the Agent and Grantor shall be deemed to include the
respective heirs, legal representatives, successors and assigns of such parties.
This instrument shall be governed by and construed in accordance with the laws
of the State of Florida, without regard to principals of conflicts of laws.
7.06 WAIVERS; ETC. The Agent and the Lenders may waive any Event of
Default without waiving any other prior or subsequent Event of Default. The
Agent and the Lenders may remedy any Event of Default without waiving the Event
of Default remedied. No single or partial exercise by the Agent of any right,
power or remedy hereunder shall exhaust the same or shall preclude any other or
further exercise thereof, and every such right, power or remedy hereunder may be
exercised at any time and from time to time. No modification or waiver of any
provision hereof nor consent to any departure by Grantor therefrom shall in any
event be effective unless the same shall be in writing and signed by
17
<PAGE>
the Agent and the Lenders as provided in the Credit Agreement and then such
waiver or consent shall be effective only in the specific instances, for the
purpose for which given and to the extent therein specified. No notice to nor
demand on Grantor in any case shall of itself entitle Grantor to any other or
further notice of demand in similar or other circumstances. Acceptance by the
Agents of any payment in an amount less than the amount then due on any
Obligations shall be deemed an acceptance on account only and shall not in any
way excuse the existence of an Event of Default hereunder.
7.07 SUCCESSORS. In the event the ownership of the Mortgaged Property
or any part thereof becomes vested in a person other than Grantor, the Agent
may, without notice to Grantor, deal with such successor or successors in
interest with reference to this Instrument and to the Obligations in the same
manner as with Grantor, without in any way vitiating or discharging Grantor's
liability hereunder or for the payment of the Obligations or performance of the
obligations secured hereby. No transfer of the Mortgaged Property, no
forbearance on the part of the Agent, and no extension of the time for the
payment of the Obligations given by any holder of the Obligations, in whole or
in part, shall affect the liability of Grantor hereunder or for obligations
secured hereby or the liability of any other person hereunder or for obligations
secured hereby or the liability of any other person hereunder or for the payment
of the Obligations.
7.08 NOTICES; ETC. All notices, requests, consents, demands and other
communications required or permitted hereunder shall be given in accordance with
the terms of the Credit Agreement.
7.09 DISCRETION OF AGENT. Except where otherwise expressly provided
herein, in any instance hereunder where the approval, consent or the exercise of
judgment of the Agent is required, the granting or denial of such approval or
consent and the exercise of such judgment shall be within the sole discretion of
the Agent, and the Agent shall not, for any reason or to any extent, be required
to grant such approval or consent or exercise such judgment in any particular
manner, regardless of the reasonableness of either the request or the Agent's
judgment.
7.10 COUNTERPARTS. This instrument may be executed in several
counterparts, all of which are identical. Each of such counterparts
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<PAGE>
shall for all purposes be deemed to be an original and all such counterparts
shall together constitute but one and the same instrument.
7.11 TIME OF THE ESSENCE. Time is of the essence with respect to each
and every covenant, agreement and obligation of Grantor under this Instrument
and the other Transaction Documents.
7.12 LIMITED LIABILITY. No personal liability or responsibility is
assumed hereunder by or shall at any time be enforceable against Fleet Real
Estate, Inc. or any successor or assign in its capacity as Lessor (including the
Agent and the Lenders) on account of any representation, warranty, undertaking
or agreement hereunder of Grantor, either expressed or implied, all such
personal liability, if any, being expressly waived by Agent, except that Agent
or any Person claiming by, through or under it, making a claim hereunder, may
look to the Mortgaged Property for satisfaction of the same and Grantor or its
successors and assigns as Lessor, as applicable, shall be personally liable for
its own gross negligence or willful misconduct.
7.13 FUTURE ADVANCES. This Instrument secures all future advances,
whether such advances are obligatory or made at the option of the Agent, which
may be advanced by the Agent or the Lenders within twenty (20) years from the
date of this Instrument and which constitutes the Obligations secured hereby.
All such future advances, together with interest thereon, shall be secured to
the same extent and have the same priority as if such future advances were made
on the date of the execution of this Instrument and shall be subject to all the
terms and provisions of this Instrument. The total amount of Obligations that
may be secured at any one time by this Instrument may decrease or increase from
time to time, but the total unpaid principal balance of the Obligations so
secured at any one time by this Instrument shall not exceed $23,280,000, plus
interest thereon, and any disbursements made for the payment of taxes, levies or
insurance on the Mortgaged Property with interest on such disbursements.
19
<PAGE>
IN WITNESS WHEREOF, Grantor has executed this Instrument under seal, as
of the day and year first above written.
GRANTOR:
Witness:/s/ GINGER STOLZENTHALER FLEET REAL ESTATE, INC.
----------------------------
Printed Name: GINGER STOLZENTHALER
By: /s/ J.C. HART
------------------------
Witness: /s/ JEFFREY GARAVANIAN Name: J.C. HART
---------------------------- Title: S.V.P
Printed Name: JEFFREY GARAVANIAN
20
<PAGE>
THE VINCAM GROUP, INC.,
Witness:/s/ MICHELLE A. HICKERSON a Florida corporation
----------------------------
Printed Name: MICHELLE A. HICKERSON
By: /s/ ELIZABETH J. KEELER
--------------------------
Witness: /s/ DEBORAH P. RUDISAIL Name: ELIZABETH J. KEELER
---------------------------- Title: VICE PRESIDENT
Printed Name: DEBORAH P. RUDISAIL
21
<PAGE>
COMMONWEALTH OF MASSACHUSETTS
COUNTY OF SUFFOLK
The foregoing Mortgage was acknowledged before be this 5th day of December,
1997, by J.C. Hart, as Sr. Vice President of Fleet Real Estate, Inc., a Rhode
Island corporation, on behalf of the corporation and he/she is personally known
to me.
/s/ CAROLINE D. HUBBARD
--------------------------------
Notary Public
Name: CAROLINE D. HUBBARD
Commission No.: June 2, 2000
My Commission Expires: Caroline D. Hubbard
Notary Public
Commission Expires June 2, 2000
22
<PAGE>
STATE OF GEORGIA
COUNTY OF FULTON
The foregoing Mortgage was acknowledged before be this 9th day of December,
1997, by Elizabeth J. Keeler, as Vice President of The Vincam Group, Inc., a
Florida corporation, on behalf of the corporation and he/she is personally known
to me or has produced Driver's License as identification.
/s/ SANDRA M. MARSH
--------------------------------
Notary Public
Name: SANDRA M. MARSH
Commission No.: October 20, 2000
Sandra M. Marsh
Notary Public
Cherokee County, Georgia
Commission Expires October 20, 2000
23
<PAGE>
EXHIBIT A
(Description of Site)
All of FOX CROFT, according to the Plat thereof recorded in Plat Book 115, at
Page 69, of the Public Records of Dade County, Florida.
24
<PAGE>
EXHIBIT "B"
(Permitted Encumbrances)
1. Taxes and assessments for the year 1998 and subsequent years which are
not yet due and payable.
2. Easement in favor of Florida Power & Light Company pursuant to
instrument dated February 7, 1952, recorded in Deed Book 3601, at Page
26, of the Public Records of Dade County, Florida.
3. Easements, restrictions and other matters arising in the Plat of Fox
Croft, as recorded in Plat Book 115, at Page 69, of the Public Records
of Dade County, Florida.
4. Order of the Metropolitan Dade County Environmental Control Board filed
October 17, 1985, in Official Records Book 12670, at Page 1659, of the
Public Records of Dade County, Florida.
5. Covenant Running with the Land in favor of Metropolitan Dade County
filed September 17, 1986, in Official Records Book 13021, at Page 2183,
of the Public Records of Dade County, Florida.
6. Declaration of Restrictions filed October 14, 1986, in Official Records
Book 13048, at Page 763, of the Public Records of Dade County, Florida.
7. Deed of Easement in favor of BellSouth Telecommunications, Inc. d/b/a
Southern Bell Telephone and Telegraph Company, a Georgia corporation,
filed December 17, 1992, in Official Records Book 15750, at Page 1974,
of the Public Records of Dade County, Florida.
8. Order of the Metropolitan Dade County Environmental Quality Control
Board filed August 7, 1997, in Official Records Book 17743, at Page
4274, of the Public Records of Dade County, Florida.
9. Terms, conditions, restrictions and options to purchase contained in
the Lease Agreement by and between The Vincam Group, Inc., (Lessee),
and Fleet Real Estate, Inc. (Lessor), dated December 9, 1997, to be
recorded in the Public Records of Dade County, Florida.
25
<PAGE>
EXHIBIT "C"
[Description of Contracts]
1. All fidelity bonds, performance bonds, insurance policies
and binders for insurance and claims for losses thereunder;
2. All permits, licenses and approvals from state, federal and local
authorities from any type, and all rights of Grantor now or hereafter
to receive utility services;
3. All warranties on any personal property of Grantor conveyed by Grantor
to Agent by this Instrument or otherwise;
4. All right, title and interest, if any, of Grantor in and to
all site plans, drawings, plans, specifications and studies
prepared by all architects, all reports, surveys and
studies made by all engineers, and all other plans, soil
test reports, environmental reports, specifications,
engineering plans and reports and any other architectural
or engineering data used or useful in connection with the
development of the Site and the construction of any of the
Improvements on the Site;
5. All certificates of occupancy;
6. All termite bonds, reports and servicing contracts, including servicing
contracts relating to any and all aspects of the ownership,
development, maintenance and operation of the Facility;
7. All deposits or prepayments of any type for any purpose made by Grantor
or anyone on its behalf;
8. All unpaid rents;
9. All proceeds and rights to all proceeds in any threatened or pending
condemnation or proceedings in lieu thereof;
10. All causes of Grantor against anyone now or hereafter arising which
involves the construction of the Facility, provided none of the
obligations of Grantor are assigned in connection with such causes of
action, with Grantor expressly agreeing to remain liable for such
obligations and, at the request of Agent, to prosecute such causes of
action in its own name;
11. All surveys; and
26
<PAGE>
12. All rights and interest of Grantor under any construction, engineering
or architectural contract to which Grantor is a party.
27
<PAGE>
EXHIBIT "D"
Schedule 1
(Description of "Debtors" and "Secured Party")
A. Debtors:
1. Name and Identity: Fleet Real Estate, Inc., a Rhode
Island corporation and The Vincam Group, Inc., a
Florida corporation
2. The residence or principal place of business of Fleet Real
Estate, Inc. is located at: One Federal Street, Boston,
Massachusetts 02109, Attention: Jay Hart, and the residence or
principal place of business of The Vincam Group, Inc. is
located at: 2850 Douglas Road, Coral Gables, Florida 33135,
Attention: Elizabeth J. Keeler, General Counsel
B. Secured Party:
Fleet National Bank, a national banking organization formed and
existing under the laws of the United States of America.
****************************************************************
Schedule 2
(Notice Mailing Addresses of "Debtors" and "Secured Party")
A. The mailing address of Fleet Real Estate, Inc. is: One
Federal Street, Boston, Massachusetts 02109, Attention: Jay
Hart, and the mailing address of The Vincam Group, Inc. is:
2850 Douglas Road, Coral Gables, Florida 33135, Attention:
Elizabeth J. Keeler, General Counsel
B. The mailing address of Secured Party is: 75 State Street,
Boston, Massachusetts 02211, Attention: Ginger
Stolzenthaler
28
GUARANTY (LESSEE)
THIS GUARANTY (LESSEE) (this "GUARANTY (LESSEE)") is made as
of December 9, 1997 by VINCAM HUMAN RESOURCES, INC.; VINCAM HUMAN RESOURCES,
INC. I; VINCAM HUMAN RESOURCES, INC. II; VINCAM HUMAN RESOURCES, INC. III;
VINCAM HUMAN RESOURCES, INC. IV; VINCAM HUMAN RESOURCES, INC. V; VINCAM HUMAN
RESOURCES, INC. VI; VINCAM HUMAN RESOURCES, INC. XII; VINCAM HUMAN RESOURCES OF
MICHIGAN, INC.; VINCAM OCCUPATIONAL HEALTH SYSTEMS, INC.; PERSONNEL RESOURCES,
INC.; VINCAM INSURANCE SERVICES, INC.; VINCAM PRACTICE MANAGEMENT, INC.;
AMERICAN PEDIATRIC SYSTEMS, INC.; and PSYCH/CARE, INC., each of which is a
Florida corporation (collectively, the "Florida Guarantors"); VINCAM/STAFF
ADMINISTRATORS, INC. (d/b/a STAFF ADMINISTRATORS, INC.), VINCAM/STAFF
ADMINISTRATORS OF WESTERN COLORADO,, INC. (d/b/a STAFF ADMINISTRATORS OF WESTERN
COLORADO, INC.); STAFF ADMINISTRATORS OF CO, INC.; and STAFF ADMINISTRATORS OF
CALIFORNIA, INC., each of which is a Colorado corporation (collectively, the
"Colorado Guarantors"); VINCAM/AMSTAFF, INC., RDM, INC., AMSTAFF PEO, INC. and
AMERICAN STAFFING, INC., each of which is a Michigan corporation (collectively,
the "Michigan Guarantors"); and VINCAM/STAFFING NETWORK, INC., a New Hampshire
corporation (the "New Hampshire Guarantor"; the Florida Guarantors, the Colorado
Guarantors, the Michigan Guarantors and the New Hampshire Guarantor being,
collectively, the GUARANTORS", which term shall include any subsidiary of The
Vincam Group, Inc. which becomes a Guarantor pursuant to Section 17 hereof and
Section 8.33 of the Credit Agreement referred to below ), in favor of Fleet Real
Estate, Inc., and its successors and assigns, including Fleet National Bank, as
Agent, for the ratable benefit of the Agent and the Lenders under the Credit
Agreement referred to below.
RECITALS
WHEREAS, Fleet Real Estate, Inc, as Lessor, has acquired fee
simple title to the Site, and intends to construct on the Site a corporate
headquarters building and related enhancements and improvements, which, with the
Site, will comprise the Facility; and
WHEREAS, the Lessor has leased the Facility, to The Vincam
Group, Inc. (together with any successor or permitted assign under the terms of
the Credit Agreement, the Lease or any other applicable Transaction Document (as
defined in Schedule 1.02 to the Credit Agreement), the "COMPANY"), pursuant to a
Lease Agreement of even date herewith (as the same may be
<PAGE>
amended, supplemented or otherwise modified from time to time,
the "LEASE"); and
WHEREAS, the Company, acting as the Lessor's
Acquisition/Construction Agent under an Agency, Indemnity and Support Agreement
dated of even date herewith (as the same may be amended, supplemented or
otherwise modified from time to time, the "AGENCY AGREEMENT"), will, on behalf
of the Lessor, complete the construction and installation of all such
enhancements and improvements on the Site and provide operations, maintenance
and management support for the Facility; and
WHEREAS, in order to finance the acquisition of the Lessor's
fee simple interest in the Site and the construction of the corporate
headquarters building and related enhancements and improvements on the Site for
the ultimate use and benefit of the Company in accordance with the Lease, the
Company, the Lessor, Fleet National Bank, as Agent (the "AGENT"), the Lenders
parties thereto and the Lessor have entered into a certain Credit and Investment
Agreement of even date herewith (as the same may be amended, supplemented or
otherwise modified from time to time, the "CREDIT AGREEMENT"), whereby the
Company has requested that the Lenders extend certain Loans to the Lessor in an
aggregate principal amount of up to $11,640,000, and that the Lessor make
certain Lessor Investments in an aggregate principal amount of up to $360,000;
and
WHEREAS, to induce the Lessor, the Agent and the Lenders to
enter into the Credit Agreement, the Guaranty (Lessor), and the other
Transaction Documents, the Guarantors have agreed to guarantee the obligations
of the Company to the Lessor under the Credit Agreement, the Guaranty (Lessor),
the Lease, the Agency Agreement and the other Transaction Documents; and
WHEREAS, the Lenders have agreed to extend the requested Loans
and the Lessor has agreed to make the requested Lessor Investments upon the
terms and conditions set forth in the Credit Agreement;
NOW, THEREFORE, in consideration of the premises and the
covenants and agreements herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Guarantors hereby agree as follows:
SECTION 1. DEFINITIONS. Terms defined in the Credit
Agreement or in Schedule 1.02 to the Credit Agreement and not
otherwise defined herein have, as used herein, the respective
meanings provided for therein.
2
<PAGE>
SECTION 2. THE GUARANTY. The Guarantors, as primary and joint
and several obligors and not merely as surety, each hereby irrevocably and
unconditionally guarantees the full and punctual payment (whether at stated
maturity, upon acceleration or otherwise) when due of all obligations of, and
all amounts owing by, the Company (but not of the Lessor) under the Lease, the
Credit Agreement, the Guaranty (Lessor), the Agency Agreement and all other
Transaction Documents, including, without limitation, all obligations to pay
Rent, Impositions, Taxes, Other Taxes, Support Expenses, the Termination Value
where the Company has not elected to acquire the Facility by payment of the
Purchase Price upon the occurrence of a Cancellation Event, the Purchase Price
where the Company elects to acquire the Facility, the Final Rent Payment or the
Completion Costs Payment, as applicable, upon the occurrence of a Termination
Event and where the Company has not elected to acquire the Facility, and
increased costs and compensation for reduced returns under Section 5.03 of the
Credit Agreement, compensation under Section 5.05 of the Credit Agreement,
expenses and indemnities under Section 11.03 of the Credit Agreement and Section
5.1 of the Agency Agreement and otherwise, and interest at the Default Rate in
respect of overdue principal of, interest and Yield on and fees in respect of
Loans and Lessor Investments, and all other amounts owing or payable of whatever
nature, and the full and punctual performance when due of all obligations and
agreements of the Company to or in favor of the Lessor, the Agent or the Lenders
under the Lease, the Credit Agreement, the Guaranty (Lessor), the Agency
Agreement and all other Transaction Documents, including, without limitation,
all obligations of the Company to cause Completion to occur in accordance with
the terms of the Agency Agreement and the other Transaction Documents and the
Company's obligation to return the Facility to the Lessor in accordance with
Section 16 of the Lease if the Company has not elected to acquire the Facility
(all of the foregoing obligations in clauses (a) and (b) above being referred to
collectively as the "GUARANTEED OBLIGATIONS"), and agrees to pay any and all
expenses (including reasonable attorneys' fees and expenses) incurred by the
Lessor, the Agent, the Lenders and their respective successors, transferees and
assigns in enforcing any rights under this Guaranty. Without limiting the
generality of the foregoing, the Guarantors' liability shall extend to all
amounts that constitute part of the Guaranteed Obligations and would be owed by
the Company to the Lessor, the Agent or the Lenders but for the fact that they
are unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar case or proceeding involving the Company. For purposes
of determining when an obligation is "DUE" for purposes of this Guaranty, such
term shall be interpreted to mean due in accordance with the terms of this
Guaranty and without regard to the amendment, modification or rejection of any
Guaranteed
3
<PAGE>
Obligation in any bankruptcy or other reorganization case or proceeding.
SECTION 3. GUARANTY UNCONDITIONAL. The Guarantors guarantee
that the Guaranteed Obligations will be paid and performed strictly in
accordance with their terms, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of the Company with respect thereto. The obligations of the Guarantors
under this Guaranty are independent of the Guaranteed Obligations and a separate
action or actions may be brought and prosecuted against the Guarantors to
enforce this Guaranty, irrespective of whether any action is brought against the
Company or any of its Affiliates or whether the Company or any of its Affiliates
is joined in any such action or actions. The obligations of the Guarantors
hereunder shall be irrevocable, unconditional and absolute and, without limiting
the generality of the foregoing, shall not be released, discharged or otherwise
affected by:
a. any extension, renewal, settlement, compromise, waiver or
release in respect of any obligation of the Company under the
Lease, the Credit Agreement, the Guaranty (Lessor), the Agency
Agreement or any other Transaction Document, by operation of
law or otherwise or any obligation of any other guarantor of
any of the Guaranteed Obligations;
b. any modification or amendment of or supplement to the
Lease, the Credit Agreement, the Guaranty (Lessor), the
Agency Agreement, any Note or any other Transaction
Document;
c. any release, nonperfection or invalidity of any direct or
indirect security for any obligation of the Company under the
Lease, the Credit Agreement, the Guaranty (Lessor), the Agency
Agreement, any other Transaction Document or any obligations
of any other guarantor of any of the Guaranteed Obligations;
d. any change in the corporate existence, structure or ownership
of the Company, or any other guarantor of any of the
Guaranteed Obligations, or any insolvency, bankruptcy,
reorganization or other similar case or proceeding affecting
the Company, or any other guarantor of the Guaranteed
Obligations, or its assets or any resulting release or
discharge of any obligation of the Company, or any other
guarantor of any of the Guaranteed Obligations;
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<PAGE>
e. the existence of any claim, set-off or other rights which any
of the Guarantors may have at any time against the Company,
any other Guarantor, any other guarantor of any of the
Guaranteed Obligations, the Lessor, the Agent, any Lender or
any other Person, whether in connection herewith or any
unrelated transactions, provided that nothing herein shall
prevent the assertion of any such claim by separate suit or
compulsory counterclaim;
f. any invalidity or unenforceability relating to or against the
Company, or any other guarantor of any of the Guaranteed
Obligations, for any reason related to the Credit Agreement,
the Guaranty (Lessor),the Agency Agreement, any other
Transaction Document or any other guaranty of the Guaranteed
Obligations, or any provision of applicable law or regulation
purporting to prohibit the payment by the Company, any other
Guarantor or any other guarantor of the Guaranteed
Obligations, of amounts due under the Lease or any other
amount payable by the Company under the Credit Agreement, the
Guaranty (Lessor), the Agency Agreement or any other
Transaction Document; or
g. any other act or omission to act or delay of any kind by the
Company, any other Guarantor, any other guarantor of the
Guaranteed Obligations, the Lessor or any other Person or any
other circumstance whatsoever which might, but for the
provisions of this paragraph, constitute a legal or equitable
discharge of the Guarantor's obligations hereunder, including,
without limitation, any failure, omission, delay or inability
on the part of the Lessor, the Agent or the Lenders to
enforce, assert or exercise any right, power or remedy
conferred on the Lessor, the Agent or the Lenders under the
Lease, the Credit Agreement, the Guaranty (Lessor), the Agency
Agreement or any other Transaction Document.
SECTION 4. REPRESENTATIONS AND WARRANTIES. The Guarantors
incorporate herein by reference as fully as if set forth herein all of the
representations and warranties pertaining to the Guarantors contained in Section
7.01 of the Credit Agreement (which representations and warranties shall be
deemed to have been renewed by the Guarantors upon each Loan or Lessor
Investment Payment under the Credit Agreement).
SECTION 5. COVENANTS. The Guarantors covenant that, so long as
any Lender or the Lessor has any Commitment outstanding under the Credit
Agreement or any amount payable under the Credit Agreement or any Note or Lessor
Investment shall
5
<PAGE>
remain unpaid, the Guarantors will fully comply with those covenants set forth
in Article VIII of the Credit Agreement pertaining to the Guarantors, and the
Guarantors incorporate herein by reference as fully as if set forth herein all
of such covenants.
SECTION 6. DISCHARGE ONLY UPON PAYMENT IN FULL; REINSTATEMENT
IN CERTAIN CIRCUMSTANCES. The Guarantors' obligations hereunder shall remain in
full force and effect until all Guaranteed Obligations shall have been paid in
full and the Commitments of the Lenders and the Lessor under the Credit
Agreement shall have terminated or expired. If at any time any payment of the
principal of or interest on any Note, the Lessor Investment or any other amount
payable by the Company under the Credit Agreement, the Guaranty (Lessor), or any
other Transaction Document is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of the Company or
otherwise, the Guarantor's obligations hereunder with respect to such payment
shall be reinstated as though such payment had been due but not made at such
time.
SECTION 7. WAIVER OF NOTICE BY THE GUARANTORS. Each of the
Guarantors irrevocably waives acceptance hereof, presentment, demand, protest
and, to the fullest extent permitted by law, any notice not provided for herein,
as well as any requirement that at any time any action be taken by any Person
against the Company, any other Guarantor, any other guarantor of the Guaranteed
Obligations or any other Person. The Agent, acting on behalf of the Lessor,
shall, to the extent reasonably practicable, provide prior written notice to the
Guarantors of any intentional action (or, in the case of an unintentional
action, such notice shall be provided upon discovery thereof by the Agent) taken
by the Lessor or the Agent referred to in Section 3, PROVIDED, HOWEVER, that the
failure to provide such notice shall not affect the Guarantors'
obligations under this Guaranty.
SECTION 8. STAY OF ACCELERATION. If acceleration of the time
for payment of any amount payable by the Company under the Lease, the Agency
Agreement, the Credit Agreement, the Guaranty (Lessor), any Note, the Lessor
Investment or any other Transaction Document is stayed upon the insolvency,
bankruptcy or reorganization of the Company, all such amounts otherwise subject
to acceleration under the terms of the Lease, the Agency Agreement, Credit
Agreement, the Guaranty (Lessor), any Note, the Lessor Investment or any other
Transaction Document shall nonetheless be payable by the Guarantors hereunder
forthwith on demand by the Lessor.
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SECTION 9. NOTICES. All notices and other communications
provided for hereunder shall be in writing (including by telecopier and other
readable communication) and mailed by certified mail, return receipt requested,
telecopied or otherwise transmitted or delivered: if to the Guarantors, at 2850
Douglas Road, Coral Gables, Florida 33134, Attention: Elizabeth J. Keeler,
General Counsel, Telecopier 305-460-2396; if to any Lender, the Agent or the
Lessor, at its address set forth under its name on the signature page to the
Credit Agreement; or, as to each party at such other address as shall be
designated by such party in a written notice to the other parties. All such
notices and communications shall, if so mailed, telecopied or otherwise
transmitted, be effective when received, if mailed, or when the appropriate
answerback or other evidence of receipt is given, if telecopied or otherwise
transmitted, respectively.
SECTION 10. NO WAIVERS. No failure or delay by the Agent or
the Lenders in exercising any right, power or privilege hereunder shall operate
as a waiver thereof nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege. The rights and remedies provided in this Guaranty, the Lease, the
Agency Agreement, the Credit Agreement, the Guaranty (Lessor), the Notes and the
other Transaction Documents shall be cumulative and shall not be exclusive of
any other rights or remedies provided by law.
SECTION 11. SUCCESSORS AND ASSIGNS. This Guaranty (Lessee) is
for the benefit of the Lessor and its successors and assigns, including the
Agent, for the ratable benefit of the Lenders. In the event of an assignment of
any amounts payable under the Lease, the Agency Agreement, the Credit Agreement,
the Guaranty (Lessor), the Notes, the Lessor Investment or the other Transaction
Documents, the rights hereunder, to the extent applicable to the indebtedness so
assigned, may be transferred with such indebtedness. This Guaranty (Lessee) may
not be assigned by the Guarantor without the prior written consent of the
Lessor, the Agent and each Lender and shall be binding upon the Guarantor and
its successors and permitted assigns.
SECTION 12. CHANGES IN WRITING. Neither this Guaranty (Lessee)
nor any provision hereof may be changed, waived, discharged or terminated
orally, but only in writing signed by the Guarantors, the Lessor, the Agent and
the Lenders.
SECTION 13. GOVERNING LAW; SUBMISSION TO JURISDICTION.
(A) THIS GUARANTY (INCLUDING, BUT NOT LIMITED TO, THE VALIDITY
AND ENFORCEABILITY HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
7
<PAGE>
WITH, THE LAWS OF THE STATE OF NEW YORK, OTHER THAN THE CONFLICT OF LAWS RULES
THEREOF.
(B) EACH OF THE GUARANTORS HEREBY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF ANY NEW YORK STATE OR FEDERAL COURT SITTING IN NEW YORK CITY AND
ANY APPELLATE COURT FROM ANY THEREOF IN ANY ACTION OR PROCEEDING BY THE AGENT OR
ANY PARTICIPANT IN RESPECT OF, BUT ONLY IN RESPECT OF, ANY CLAIMS OR CAUSES OF
ACTION ARISING OUT OF OR RELATING TO THIS GUARANTY (LESSEE) OR THE OTHER
TRANSACTION DOCUMENTS (SUCH CLAIMS AND CAUSES OF ACTION, COLLECTIVELY, BEING
"PERMITTED CLAIMS"), AND THE GUARANTORS HEREBY IRREVOCABLY AGREE THAT ALL
PERMITTED CLAIMS MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR IN
SUCH FEDERAL COURT. EACH OF THE GUARANTORS HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO
THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY AFOREMENTIONED COURT IN
RESPECT OF PERMITTED CLAIMS. EACH OF THE GUARANTORS HEREBY IRREVOCABLY APPOINTS
CT CORPORATION SYSTEM (THE "PROCESS AGENT"), WITH AN OFFICE ON THE DATE HEREOF
AT 1633 BROADWAY, NEW YORK, NEW YORK 10019, AS ITS AGENT TO RECEIVE ON BEHALF OF
SUCH GUARANTOR AND ITS PROPERTY SERVICE OF COPIES OF THE SUMMONS AND COMPLAINT
AND ANY OTHER PROCESS WHICH MAY BE SERVED BY THE LESSOR, THE AGENT OR THE
LENDERS IN ANY SUCH ACTION OR PROCEEDING IN ANY AFOREMENTIONED COURT IN RESPECT
OF PERMITTED CLAIMS. SUCH SERVICE MAY BE MADE BY DELIVERING A COPY OF SUCH
PROCESS TO THE COMPANY BY COURIER AND BY CERTIFIED MAIL (RETURN RECEIPT
REQUESTED), FEES AND POSTAGE PREPAID, BOTH (I) IN CARE OF THE PROCESS AGENT AT
THE PROCESS AGENT'S ABOVE ADDRESS AND (II) AT EACH GUARANTOR'S ADDRESS SPECIFIED
PURSUANT TO SECTION 9, AND EACH GUARANTOR HEREBY IRREVOCABLY AUTHORIZES AND
DIRECTS THE PROCESS AGENT TO ACCEPT SUCH SERVICE ON ITS BEHALF. THE GUARANTORS
AGREE THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE
AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY
OTHER MANNER PROVIDED BY LAW.
(C) NOTHING IN THIS SECTION 13: (I) SHALL AFFECT THE RIGHT OF
THE LESSOR, ANY LENDER OR THE AGENT TO SERVE LEGAL PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR AFFECT ANY RIGHT OTHERWISE EXISTING OF THE LESSOR, ANY
LENDER OR THE AGENT TO BRING ANY ACTION OR PROCEEDING AGAINST THE GUARANTORS OR
THEIR RESPECTIVE PROPERTY IN THE COURTS OF OTHER JURISDICTIONS OR (II)
8
<PAGE>
SHALL BE DEEMED TO BE A GENERAL CONSENT TO JURISDICTION IN ANY PARTICULAR COURT
OR A GENERAL WAIVER OF ANY DEFENSE OR A CONSENT TO JURISDICTION OF THE COURTS
EXPRESSLY REFERRED TO IN SUBSECTION (A) ABOVE IN ANY ACTION OR PROCEEDING IN
RESPECT OF ANY CLAIM OR CAUSE OF ACTION OTHER THAN PERMITTED CLAIMS.
SECTION 14. TAXES, ETC. All payments required to be
made by the Guarantors hereunder shall be made without set-off or counterclaim
and free and clear of, and without deduction or withholding for or on account
of, any present or future taxes, levies, imposts, duties or other charges of
whatsoever nature imposed by any government or any political or taxing authority
as required pursuant to Section 4.06 of the Credit Agreement.
SECTION 15. SUBROGATION. Each of the Guarantors hereby agrees
that it will not exercise any rights which it may acquire by way of subrogation
under this Guaranty (Lessee) or the Contribution Agreement, by any payment made
hereunder or otherwise, unless and until all of the Guaranteed Obligations shall
have been paid in full. If any amount shall be paid to the Guarantor on account
of such subrogation rights at any time when all of the Guaranteed Obligations
shall not have been paid in full, such amount shall be held in trust for the
benefit of the Lessor, the Agent and the Lenders and shall forthwith be paid to
the Lessor to be credited and applied to the Guaranteed Obligations, whether
matured or unmatured, in accordance with the terms of the Credit Agreement.
SECTION 16. WAIVER OF JURY TRIAL. EACH OF THE GUARANTOR AND
THE LESSOR WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT
TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR TO DEFEND ANY
RIGHTS UNDER THIS GUARANTY OR ANY OTHER TRANSACTION DOCUMENT OR UNDER AMENDMENT,
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE
DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR ARISING FROM ANY RELATIONSHIP
EXISTING IN CONNECTION WITH THIS GUARANTY (LESSEE) OR ANY OTHER TRANSACTION
DOCUMENT, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A
COURT AND NOT BEFORE A JURY.
SECTION 17. ADDITIONAL GUARANTORS. Section 8.33 of the Credit
Agreement provides that Subsidiaries must become Guarantors by, among other
things, executing and delivering to the Agent a counterpart of this Guaranty
(Lessee) and of the Contribution Agreement. Any Subsidiary which executes and
delivers to the Agent a counterpart of this Guaranty (Lessee) and of the
Contribution Agreement shall be a Guarantor for all purposes hereunder.
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<PAGE>
IN WITNESS WHEREOF, the Guarantors have caused this Guaranty
(Lessee) to be duly executed by its authorized officer as of the date first
above written.
VINCAM HUMAN RESOURCES, INC.
VINCAM HUMAN RESOURCES, INC. I
VINCAM HUMAN RESOURCES, INC. II
VINCAM HUMAN RESOURCES, INC. III
VINCAM HUMAN RESOURCES, INC. IV
VINCAM HUMAN RESOURCES, INC. V
VINCAM HUMAN RESOURCES, INC. VI
VINCAM HUMAN RESOURCES, INC. XII
VINCAM HUMAN RESOURCES OF MICHIGAN, INC.
VINCAM OCCUPATIONAL HEALTH SYSTEMS, INC.
PERSONNEL RESOURCES, INC.
VINCAM INSURANCE SERVICES, INC.
VINCAM PRACTICE MANAGEMENT, INC.
AMERICAN PEDIATRIC SYSTEMS, INC.
PSYCH/CARE, INC.
VINCAM/STAFF ADMINISTRATORS, INC.
d/b/a STAFF ADMINISTRATORS, INC.)
VINCAM/STAFF ADMINISTRATORS OF
WESTERN COLORADO,, INC. (d/b/a
STAFF ADMINISTRATORS OF
WESTERN COLORADO, INC.)
STAFF ADMINISTRATORS OF CO, INC.
STAFF ADMINISTRATORS OF CALIFORNIA, INC.
VINCAM/AMSTAFF, INC.
RDM, INC.
AMSTAFF PEO, INC.
AMERICAN STAFFING, INC.
VINCAM/STAFFING NETWORK, INC.
By: /s/ ELIZABETH J. KEELER
----------------------------------
Name: Elizabeth J. Keeler
Title: Vice President
10
EXHIBIT 10.6
DEVELOPMENT AGREEMENT
===========================================
===========================================
DEVELOPMENT AGREEMENT
for a
TWO STORY BUILDING OF APPROXIMATELY
89,000 RENTABLE SQUARE FEET WITH PAVED GROUND-LEVEL PARKING
made by and between
THE VINCAM GROUP, INC.,
-----------------------
as agent for
FLEET REAL ESTATE, INC., or its designee
and
CODINA DEVELOPMENT CORPORATION
===========================================
===========================================
<PAGE>
DEVELOPMENT AGREEMENT
THIS DEVELOPMENT AGREEMENT ("Agreement") is entered into as of this
12th day of September, 1997, by and between CODINA DEVELOPMENT CORPORATION, a
Florida corporation ("Developer"), and THE VINCAM GROUP, INC., a Florida
corporation ("Agent"), as agent for Fleet Real Estate, Inc., a Rhode Island
corporation, or its designee ("Owner"), pursuant to that certain agreement by
and between the Owner and the Agent (the "Agency Agreement"). This Agreement
shall not be effective and each and every obligation of the parties under this
Agreement shall not become effective for any purpose until such Agency Agreement
is executed by the parties thereto, except for those obligation of the parties
set forth in the letter from the Agent to the Developer dated as of September
12, 1997.
WITNESSETH:
WHEREAS, the Agent desires to engage the Developer to develop a two
story building containing approximately 89,000 Rentable Square Feet (as
hereinafter defined) with paved ground-level parking for 498 vehicles and other
amenities all in accordance with Public Laws (as hereinafter defined) (the
"Project"), for the benefit of the Owner to own and to lease to the Agent, to be
located on that certain real property more particularly described on EXHIBIT A
attached hereto and made a part hereof by this reference, at the southwest
corner of S.W. 72 Street and S.W. 102 Avenue in Miami, Florida (the "Site");
WHEREAS, the Agent desires to enter into an agreement with the
Developer whereby the Developer will design, secure permits for, construct,
develop and deliver the Project to the Agent;
WHEREAS, contemporaneously with the execution of this Agreement, the
Developer will assign its rights, duties and obligations under the Purchase
Contract (as hereinafter defined) for the Site to the Owner; and
WHEREAS, the Owner, upon completion of the Project, will lease the
Site, as improved with the Project, to the Agent pursuant to a lease between the
Owner and the Agent (the "Lease").
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and obligations herein contained, the parties, intending to be legally
bound, hereby agree as follows:
ARTICLE 1
RECITALS
The foregoing recitals are true and correct and are hereby incorporated
herein, and made a part hereof, by this reference.
ARTICLE 2
DEFINITIONS
The following terms shall have the meanings specified in this Article 2
when used in this Agreement. The meanings specified are applicable to both the
singular and plural.
"AGENT'S MAXIMUM PAYMENT" shall mean the maximum amount payable by the
Agent for this Project, which amount shall, in no event, exceed One Million and
No/100 Dollars ($1,000,000.00).
"AGREEMENT" shall mean this Agreement (including all Exhibits hereto),
as it may be amended or supplemented from time to time.
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"APPLICATION FOR PAYMENT" shall have the meaning set forth in Section
7.4.1 of this Agreement.
"ARCHITECT" shall mean Retzsch, Lanao and Caycedo, which has been
engaged by the Developer, and is responsible to the Developer for the completion
of the design of the Project, pursuant to the Design Contract (as hereinafter
defined), or such other architect as may be selected from time to time subject
to the Agent's reasonable approval.
"AUTHORIZED EXTENSION" shall have the meaning set forth in Section 7.6
of this Agreement.
"BUDGET" shall mean the line item breakdown of all costs associated
with the planning, permitting, design, testing, development, construction, and
related costs for the Project, all contingencies, costs associated with payment
and performance bonds and insurance (including builder's risk insurance), and
costs associated with the negotiation and administration of contracts for, and
the management of, the Project, the sum of which shall in no event exceed the
Budgeted Amount and which includes the Development Fee, the Project Soft Costs,
the Closing Costs, the Change Order Contingency, the Purchase Price and the
Guaranteed Maximum Construction Price. The Budget as of the Execution Date is
attached hereto and made a part hereof as EXHIBIT B and shall continue to be
updated and developed into greater detail in accordance with the terms of this
Agreement, subject, however, to the limitation on the Budgeted Amount, unless
increased due to Change Orders or Construction Change Directives in excess of
the Change Order Contingency.
"BUDGETED AMOUNT" shall mean Eleven Million and No/100 Dollars
($11,000,000.00).
"CHANGE" shall have the meaning set forth in Section 6.3.1 of this
Agreement.
"CHANGE ORDER" shall have the meaning set forth in Section 6.3.1 of
this Agreement.
"CHANGE ORDER CONTINGENCY" shall mean the line-item contingency amount
in the schedule of values for the Construction Contract Sum plus ten percent
(10%) for administrative costs and real estate commissions, included solely for
the purpose of allocating funding for Change Orders or Construction Change
Directives, requested by the Agent, which contingency amount shall not be
considered as a source of funding for any other expense of the Developer or the
Owner and which amount shall be the difference between Eleven Million and No/100
Dollars ($11,000,000.00) and the actual cost of the following: the Development
Fee, the Project Soft Costs, the Closing Costs, the Purchase Price and the
Guaranteed Maximum Construction Price, but in no event less than Four Hundred
Five Thousand Eight Hundred Seventy-six and No/100 Dollars ($405,876.00) which
sum includes ten percent (10%) for administrative costs and real estate
commissions.
"CLOSING COSTS" shall mean the costs incurred by any party to this
Agreement in connection with the purchase of the Site including the negotiation
of this Agreement and all other agreements referenced herein, title insurance,
attorney's fees, recording costs, including documentary stamps and surtax on the
deed for the Site and attorney's fees, intangible taxes and recording costs on a
mortgage executed by the Owner and encumbering the Site, which costs are
estimated in the Budget to be Two Hundred Seven Thousand Seven Hundred
Twenty-eight and No/100 Dollars ($207,728.00), and which may be adjusted in
accordance with Section 7.1.1 of this Agreement.
"CLOSING DATE" shall mean the later of: (a) the closing date set forth
in the Purchase Contract; or (b) the Site Purchase Date of Completion (as
hereinafter defined) unless such date is extended as provided in the Purchase
Contract, but in no event later than December 1, 1997, or such earlier date as
is mutually agreeable with Seller (as hereinafter defined) and the Owner, as
assignee of the rights of Developer under the Purchase Contract.
"CONCEPTUAL DRAWINGS" shall mean those certain architectural drawings
depicting the concept of the Project, prepared by the Architect and set forth in
the Proposal.
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"CONSTRUCTION CHANGE DIRECTIVE" shall have the meaning set forth in
Section 6.3.3 of this Agreement.
"CONSTRUCTION CONTRACT" shall mean the construction contract to be
entered into by and between the Developer and the Contractor selected by the
Developer and approved by the Agent for the construction of the Project, or any
portion thereof, as such construction contract may be amended or replaced from
time to time upon the Agent's reasonable approval, substantially in the form
which is attached hereto and made a part hereof as EXHIBIT C.
"CONSTRUCTION CONTRACT DOCUMENTS" shall mean the Construction Contract
and all amendments thereto, and shall include the Drawings and the
Specifications prepared by the Architect, and all Change Orders and Construction
Change Directives executed or issued subsequent to the date of the Construction
Contract.
"CONSTRUCTION CONTRACT SUM" shall mean the sum to be paid to the
Contractor in accordance with the terms of the Construction Contract, which sum
includes the Cost of the Work (including the Contractor's General Conditions
Cost) plus the Contractor's Fee, and which sum shall not exceed the Guaranteed
Maximum Construction Price.
"CONTRACT TIME" shall mean the period of time commencing on the
Execution Date (as hereinafter defined) and continuing until June 1, 1998,
subject to extension by Change Orders and Construction Change Directives that
require the critical path of the Development Schedule to be extended, if any,
and Authorized Extensions.
"CONTRACTOR" shall the mean Codina Construction Corporation, a Florida
corporation, duly licensed pursuant to Chapter 489, Florida Statutes, to be
engaged by the Developer, responsible for constructing the Project, or any
portion thereof, pursuant to the Construction Contract, and such replacement
contractor(s) as may be selected from time to time, subject to the Agent's
approval.
"CONTRACTOR'S FEE" shall mean that certain fixed amount set forth in
the Construction Contract, which amount may become due and payable to the
Contractor, in monthly installments proportionate to the percentage of
completion of the Work, subject to a ten percent (10%) retainage as provided in
the Construction Contract, and shall not exceed the sum of Three Hundred
Forty-nine Thousand Six Hundred and No/100 Dollars ($349,600.00), unless
increased as a result of Change Orders or Construction Change Directives in
excess of the Change Order Contingency.
"CONTRACTOR'S GENERAL CONDITIONS COST" shall mean the fixed sum of One
Hundred Five Thousand and No/100 Dollars ($105,000.00),which shall be a part of
the Cost of the Work and shall be payable in accordance with Section 7.4 of this
Agreement, and which shall include those line item components of the Cost of the
Work set forth in EXHIBIT N, attached hereto and made a part hereof by this
reference.
"COST OF THE WORK" shall mean all direct costs reasonably and
necessarily incurred in the proper performance of the Work. The Cost of the Work
shall include only those categories of cost set forth in EXHIBIT M attached
hereto and made a part hereof.
"DATE OF SUBSTANTIAL COMPLETION" shall mean the date on which the
Developer achieves Substantial Completion of the entire Work pursuant to this
Agreement, as certified by the Architect pursuant to the Architect's obligations
under the Design Contract.
"DESIGN CONTRACT" shall mean the design contract to be entered into by
and between the Developer and the Architect for the completion of the design of
the Project, or any portion thereof, as such design contract may be amended or
replaced from time to time upon the Agent's reasonable approval, substantially
in the form which is attached hereto and made a part hereof as EXHIBIT D.
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<PAGE>
"DESIGN DEVELOPMENT DOCUMENTS" shall mean those architectural and
engineering drawings, outline specifications and other instruments of service
that are based-upon the Conceptual Drawings and Outline Specifications and that
delineate, fix and describe the size, character and content of the entire
Project with respect to materials, architectural, structural, mechanical and
electrical systems, site development and engineering, and such other elements
and components of the Project as may be appropriate or necessary for the
construction of the Project, all within the requirements of the Guaranteed
Maximum Construction Price.
"DEVELOPMENT FEE" shall mean the sum of Four Hundred Seventy Five
Thousand and No/100 Dollars ($475,000.00) payable by the Agent to the Developer
in accordance with Article 7 of this Agreement.
"DEVELOPMENT SCHEDULE" shall mean the critical path schedule of events,
dates and milestones for the timely completion of the Project, as set forth in
EXHIBIT E attached hereto and made a part hereof.
"DRAWINGS" shall mean the graphic representations prepared by the
Architect which describe the Work to be performed by the Contractor, including
plans, elevations, sections, details, schedules and diagrams.
"EFFECTIVE TERMINATION DATE" shall have the meaning set forth in
Section 9.6 of this Agreement.
"EVENT OF FORCE MAJEURE" shall mean damage caused by fire, windstorm or
other casualty or by governmental directive or order or labor dispute in no way
chargeable to the Developer, the Architect or the Contractor, or by any
extraordinary conditions arising out of war or government regulations, or by any
other cause beyond the control of and not due to any fault, neglect, act or
omission of the Agent, the Developer, the Architect, the Contractor, their
officers, directors, agents, employees, consultants, Subcontractors or
suppliers.
"EVENTS OF DEVELOPER'S DEFAULT" shall have the meaning set forth in
Section 9.2 of this Agreement.
"EVENTS OF AGENT'S DEFAULT" shall have the meaning set forth in Section
9.3 of this Agreement.
"EXECUTION DATE" shall mean September 12, 1997.
"FINAL COMPLETION" shall have the meaning set forth in Section 7.5.1 of
this Agreement.
"FINAL PLAN OF DEVELOPMENT" shall have the meaning set forth in Section
5.2.3 of this Agreement.
"GUARANTEED FINAL COMPLETION DATE" shall mean July 31, 1998, subject to
extension by Change Orders and Construction Change Directives that require the
critical path of the Development Schedule to be extended in the Developer's
reasonable discretion, if any, and Authorized Extensions, which is the date the
Developer guarantees that the Project shall have satisfied the requirements for
Final Completion, provided, however, in the event a temporary certificate of
occupancy has been issued by the appropriate governmental authority the
Guaranteed Final Completion Date shall be the earlier of (i) July 31, 1998,
subject to extension by Change Orders and Construction Change Directives that
require the critical path of the Development Schedule to be extended, if any,
and Authorized Extensions, or (ii) the expiration date of such temporary
certificate of occupancy, as such temporary certificate of occupancy may be
extended in accordance with Public Laws.
"GUARANTEED MAXIMUM CONSTRUCTION PRICE" shall mean a sum which shall,
in no event, exceed the amount of Four Million Four Hundred Seventy-nine
Thousand One Hundred Thirteen and No/100 Dollars ($4,479,113.00), unless
increased due to Change Orders or Construction Change Directives in excess of
the Change Order Contingency, subject to adjustment as provided in Section
7.1.1.
"LENDER" shall have the meaning set forth in Section 6.1 of this
Agreement.
"OUTLINE SPECIFICATIONS" shall mean those certain outline
specifications contained in the Proposal.
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"PERMITTED EXCEPTIONS" shall mean the exceptions to title listed in
EXHIBIT F of this Agreement.
"PHASE I SERVICES" shall have the meaning set forth in Section 5.2.1 of
this Agreement.
"PHASE II SERVICES" shall have the meaning set forth in Section 5.2.2
of this Agreement.
"PHASE III SERVICES" shall have the meaning set forth in Section 5.2.3
of this Agreement.
"PHASE IV SERVICES" shall have the meaning set forth in Section 5.2.4
of this Agreement.
"PROJECT" shall have the meaning set forth in the recitals to this
Agreement.
"PROJECT SOFT COSTS" shall mean those costs and fees reasonably and
necessarily incurred for the Project for architectural services, engineering
services, environmental services (excluding clean-up costs associated with the
Site which entails, without limitation, the removal of a pile of roughly 200
tires, the filling of an open excavation of approximately 70 feet by 30 feet and
the removal of miscellaneous debris, including a large portion of a derelict
automobile and which clean-up costs shall be paid solely by the Seller) and
administrative services, legal fees, governmental and impact fees, costs for
utilities, taxes, insurance costs, and other similar costs and fees, not
otherwise included in the Construction Contract Sum, which costs and fees shall,
in no event, exceed the amount of One Million Seven Hundred Eighty-five Thousand
Five Hundred Thirty-six and No/100 Dollars ($1,785,436.00), subject to
adjustment as provided in Section 7.1.1.
"PROPOSAL" shall mean that certain proposal for The Vincam Group, Inc.
prepared by Codina Development Corporation and made effective as of May 17,
1997, attached hereto and made a part hereof as EXHIBIT G.
"PUBLIC LAWS" shall mean all applicable federal, state and local laws,
codes, ordinances, rules, regulations, standards or orders of any public
authority having jurisdiction over the Project, including building, health,
labor, safety, licensing, environmental or zoning laws, codes, ordinances,
rules, regulations, standards or orders of any such public authority.
"PUNCH LIST" shall have the meaning set forth in Section 7.4.5 of this
Agreement.
"PURCHASE CONTRACT" shall mean that certain Contract for Sale and
Purchase made and entered into by and between Nicoi Investment, Inc., a Florida
corporation, as seller and Developer, as buyer, dated as of May 7, 1997, as
amended pursuant to those certain letter agreements dated June 6, 1997 and July
22, 1997, a copy of each of which is attached hereto and made a part hereof as
EXHIBIT H.
"PURCHASE PRICE" shall have the meaning given to such term in the
Purchase Contract, and which price shall, in no event, exceed the amount of Two
Million Five Hundred Fifty Thousand and No/100 Dollars ($2,550,000.00), unless
otherwise agreed to by the Agent and the Developer.
"RENTABLE SQUARE FEET" shall mean the square footage calculated by the
Architect, and verified by using building office management association ("BOMA")
standards.
"SCOPE OF WORK" shall mean the aggregate of all Work required to
complete the Project.
"SELLER" shall mean Nicoi Investment, Inc., a Florida corporation.
"SITE PURCHASE DATE OF COMPLETION" shall mean that date on which the
conditions precedent set forth in Sections 3.1.1, 3.1.2, 3.1.3, 3.1.4 and 3.1.5
hereof have been satisfied or waived in writing by the Agent.
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"SPECIFICATIONS" shall mean the written requirements for materials,
equipment, construction systems, and other aspects of the Work, prepared by the
Architect, which describe Work to be performed by the Contractor.
"SUBCONTRACTOR" shall mean any subcontractor in privity with any
contractor or any subcontractor, at any tier.
"SUBSTANTIAL COMPLETION" shall mean the stage in the progress of the
Work when: (a) all final inspections and certifications have been obtained by,
through or on behalf of the Developer pursuant to all governmental requirements,
including, without limitation, certificates of occupancy issued by the
appropriate governmental authority to entitle occupancy of the Project for its
intended use, (b) evidence, reasonably acceptable to the Agent, of such
inspections and certifications has been delivered to the Agent, and (c) all
interior and exterior construction, including, without limitation, all heating,
ventilating and air conditioning systems, all electrical systems, all tenant
improvements, all mechanical systems, all conduits and raceways for security,
data, telecommunications and information systems, including conduits and
raceways for fiber optic lines, all paving, grading, drainage, irrigation and
landscape work, including roadway and utility improvements to be completed
off-Site and all parking areas and curb cuts have been completed to the extent
and in the manner required by the Construction Contract (except that completion
of reasonable punch list items shall not be required prior to certification of
Substantial Completion), such that all of the improvements within the entire
Scope of the Work are physically habitable, operational and usable for their
intended purposes.
"TEMPORARY SPACE" shall mean approximately 19,240 Rentable Square Feet
of office space and 96 parking spaces at the office building located at 8500
N.W. 33rd Street, Miami, Florida 33166 and known as Westside Plaza.
"TOTAL PROJECT COST" shall mean the sum of the Development Fee, the
Project Soft Costs, the Purchase Price, the Closing Costs, and the Construction
Contract Sum, which sum shall include all costs associated with the acquisition
of the Site, the planning, permitting, design, testing, development and
construction of the Project, to be paid or caused to be paid by the Agent
pursuant to this Agreement, and which sum shall, in no event, exceed the
Budgeted Amount.
"WORK" shall mean all labor, materials, equipment and services, or any
portion thereof, that are indicated on, inferable from, or incidental to the
Construction Contract Documents, that are likely to be required in accordance
with any Public Law, or that are properly and customarily included within the
general scope of work included into similar projects, including, but not limited
to, all types and quantities of components, items, systems, materials and
methods of construction to be included in the Project, whether or not indicated
on the Drawings and Specifications, in order to produce a first-class Project
fit for the Agent's intended purposes.
ARTICLE 3
ACQUISITION AND OWNERSHIP OF THE SITE
3.1 CONDITIONS PRECEDENT TO THE AGENT'S OBLIGATIONS. Notwithstanding anything to
the contrary contained in this Agreement, the Agent shall not be obligated to
perform any obligations under this Agreement, unless and until the following
conditions precedent have been satisfied by the Seller or waived, in writing, by
the Agent:
3.1.1 COMPLIANCE WITH PURCHASE CONTRACT. The Seller shall have, at its
sole cost and expense, performed all of its obligations under the Purchase
Contract, including, without limitation, its obligation to clean-up the Site and
fill the Site to grade, in accordance with those certain amendments to the
Purchase Contract by letter agreements dated June 6, 1997 and July 22, 1997.
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3.1.2 TITLE. Good, marketable and fee simple title of record and in
fact to the Site shall be vested in the Seller on or before the Closing Date,
subject only to the Permitted Exceptions and such other matters as the Seller
shall cause to be removed at or prior to the Closing Date.
3.1.3 DELIVERIES REQUIRED BY THE TITLE COMMITMENT. The Seller shall
deliver to the Agent, satisfactions, releases or other documents required by the
title commitment issued by the Agent's counsel, including, but not limited to,
such documentation as the title underwriter may require in order to delete the
"gap" exception from the title commitment on the Closing Date.
3.1.4 PLAT ISSUES. All easements, reservations, dedications and owner's
restrictions set forth in the plat recorded in Plat Book 115, Page 69 of the
Public Records of Dade County Florida (the "Original Plat") shall have been
terminated of record through replatting the Site pursuant to a plat acceptable
to the Owner and Agent, the Agent's title underwriter shall have agreed to
delete from the Agent's title commitment any title exception regarding matters
set forth on the Original Plat and the Seller shall have executed and recorded
in the Public Records of Dade County, Florida an affidavit confirming the
Seller's intent to terminate the restrictions and other matters set forth in the
Original Plat.
3.1.5 CEILING HEIGHT AND SITE PLAN. The Seller shall have obtained all
permits and approvals with all appeal periods having expired, from Metropolitan
Dade County, Florida which permits the construction of a structure at the Site
of two (2) stories of office space, with each story having an interior height
dimension, as measured from the floor slab to the ceiling tiles or other
finished ceiling material, of nine (9) feet and which permits the Project to be
constructed in substantial compliance with the Site plan, dated September 15,
1997, as prepared by Retzch, Lanao and Caycedo (the "Site Plan"). The Site Plan
is attached hereto and made a part hereof as EXHIBIT R.
3.2 SATISFACTION OF CONDITIONS PRECEDENT. In the event that any of the foregoing
conditions precedent set forth in Sections 3.1.1, 3.1.2, 3.1.3, 3.1.4 and 3.1.5
of this Agreement are not satisfied or waived as provided in Section 3.1 of this
Agreement, and before the Closing Date, then this Agreement shall be terminated
and of no further force or effect, and the parties shall be released from all
further obligations hereunder; provided, however, the Developer shall pay to the
Agent any monies paid by the Agent in connection with the Purchase Contract and
this Agreement, including, without limitation, the Two Hundred Ten Thousand and
No/100 Dollars ($210,000.00) deposit, and Twenty-eight Thousand Six Hundred
Thirty-seven and No/100 Dollars ($28,637.00) of Project Soft Costs paid by the
Agent, less Eighty Thousand and No/100 Dollars ($80,000.00).
3.3 DEVELOPER'S DELIVERIES. Simultaneous with execution of this Agreement,
Developer shall furnish or make available to the Agent the following:
3.3.1 PERMITS. To the extent available, copies of zoning variances (if
any), subdivision plats, and any proposed replat, together with supporting
documentation as filed currently with Dade County, governmental permits,
approvals, development orders, orders, certificates and other licenses relating
to the Site and other correspondence with governmental authorities related to
the foregoing (including, without limitation, any default notices).
3.3.2 TAXES. A copy of the 1996 real estate tax bill for the Site, and
if paid, a copy of receipt(s) evidencing such payment.
3.3.3 ABSTRACT OF TITLE; TITLE POLICY; SURVEY. Such title evidence as
is required to be delivered by the Seller to the Purchaser pursuant to the
Purchase Contract covering the period commencing with the earliest public
records through a date fifteen (15) days prior to the Execution Date, together
with an existing title insurance policy (if any) for the Site and any existing
survey (if any) for the Site.
3.3.4 ORGANIZATIONAL DOCUMENTS. Certified copy of the articles of
incorporation of Seller, as certified by the Secretary of State, State of
Florida; a copy of the by-laws of Seller, certified by the Secretary
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of Seller to be true, correct and complete, if available, upon the Developer
using its reasonable efforts to obtain same from the Seller; and a certificate
of good standing for Seller, from the Secretary of State, State of Florida.
3.3.5 ENVIRONMENTAL REPORTS. To the extent in the Developer's
possession or control, copies of any environmental reports or audits and related
documentation, including soil tests, engineering reports and similar data and
technical information related to the Site, which reports shall confirm the
filling to grade of an open excavation of approximately 70 feet by 30 feet and
the removal of miscellaneous debris, including portions of automobiles have been
accomplished to the Agent's satisfaction.
3.4 DEVELOPER'S REPRESENTATIONS, WARRANTIES AND COVENANTS AS TO THE SITE. The
Developer represents, warrants and covenants with the Agent as of the Execution
Date as follows:
3.4.1 LEASES. As of the Closing Date, to the Developer's knowledge,
there shall be no leases or other rights to use or occupy the Site or any
portion thereof.
3.4.2 ABILITY TO PERFORM. To the Developer's knowledge, the Seller has
full power to execute, deliver and carry out the terms and provisions of the
Purchase Contract and has taken all necessary action to authorize its execution,
delivery and performance of the Purchase Contract. To the Developer's knowledge,
the person who executed the Purchase Contract on behalf of the Seller was duly
authorized to do so, and the Purchase Contract constitutes the legal, valid and
binding obligation of Seller enforceable in accordance with its terms, except as
limited by applicable bankruptcy or other laws relating to creditors rights
generally.
3.4.3 NO ACTIONS. To the best of the Developer's knowledge, upon
reasonable inquiry, there are no actions, suits or proceedings, pending or to
the best of Developer's knowledge threatened before any court, commission,
agency or administrative authority against, or affecting, the Site, including,
without limitation, actions for condemnation of the Site or any part thereof,
and the Site is not the subject of any order or decree other than those of
general application.
3.4.4 COMPLIANCE WITH LAW. The Developer has received no written notice
and otherwise has no reason to believe that the Site is in violation of any
Public Laws applicable to the Site. The Developer has received no written notice
and otherwise has no reason to believe that any of the permits, certificates,
licenses or approvals required for the construction and use of the Project
cannot be obtained as contemplated pursuant to this Agreement.
3.4.5 UTILITIES. To the best of the Developer's knowledge, upon
reasonable inquiry, there is no pending or threatened curtailment of any utility
service presently being supplied to the Site. To the best of the Developer's
knowledge, upon reasonable inquiry, water, sanitary sewer, electrical and
telecommunication utility services and facilities, including fiber optic lines,
with a capacity to provide such services to the Site in accordance with the
Agent's intended use are available at the Site, and such capacity shall be
available to serve the Agent's intended use of the Site.
3.4.6 ASSESSMENTS. To the best of the Developer's knowledge, upon
reasonable inquiry, no special assessments for public improvements have been
made against the Site which are unpaid, including, without limitation, those for
construction of sewer, water and other utility lines, streets, sidewalks and
curbs, and there are no pending liens on account thereof.
3.4.7 DISCLOSURE. There is no fact regarding the Site within the
Developer's knowledge, upon reasonable inquiry, which adversely affects the Site
in any material fashion, that has not been disclosed to the Agent in writing.
3.4.8 OTHER CONTRACTS. To the best of the Developer's knowledge, upon
reasonable inquiry, the Seller has disclosed, and delivered to the Developer a
true copy of any and all contracts or agreements under which Seller is obligated
in connection with the Site.
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3.4.9 REAL ESTATE BROKER/SALESMEN. The Developer and the Seller have
not employed or contacted any real estate broker or salesman regarding the
Purchase Contract who may be entitled to a commission except Alex Embry &
Associates, to whom the Seller shall pay a commission of four percent (4%) of
the Purchase Price and Codina Bush Klein Oncor International, to whom Seller
shall pay a commission of three percent (3%) of the Purchase Price
(collectively, the "Broker"). The Developer hereby agrees to defend, indemnify
and hold the Owner and the Agent harmless from and against any claim, loss,
liability or expense (including court costs, reasonable attorneys' fees, and
expert fees) in connection with any claims or demands for brokerage or finder's
fees or other similar commissions or compensation made by the Broker or any and
all other brokers, salesmen or finders claiming to have dealt with the Developer
in connection with the Purchase Contract or the consummation of same as of the
Closing Date contemplated under the Purchase Contract. The warranty and
obligations in this Section 3.4.9 shall survive after the Closing Date or the
termination of this Agreement for any reason.
3.5 ASSIGNMENT OF PURCHASE CONTRACT. Upon written request of the Agent, but in
no event later than the date upon which the obligations set forth in Article 3
hereof have been performed and the conditions precedent set forth therein have
been satisfied or waived in accordance with Article 3 hereof, the Developer
shall assign all of its rights, duties and obligations under the Purchase
Contract to the Owner. Notwithstanding the foregoing, the Owner shall not be
obligated to assume the Developer's rights, duties and obligations under the
Purchase Contract unless and until the obligations set forth in Article 3 hereof
have been performed and the conditions precedent set forth therein have been
satisfied or waived in accordance with Article 3 hereof. In connection
therewith, the Developer shall request the Seller to provide to the Owner and
the Agent an estoppel letter from the Seller, which shall provide, among other
things, that there are no existing defaults by the Developer under the Purchase
Contract or any circumstances under the Purchase Contract in which the giving of
notice or lapse of time would constitute a default, the exact amounts of the
deposits under the Purchase Contract currently being held by the Seller or the
escrow agent thereunder, confirmation of the Closing Date and a consent to the
assignment of the Purchase Contract to the Owner. In the event the Developer is
unable to obtain said estoppel letter from the Seller as provided above, the
Developer shall substitute its own estoppel letter containing the information
described above and such other additional information as reasonably requested by
the Owner and the Agent.
ARTICLE 4
TIME FOR COMPLETION
The Developer and the Agent agree that time is of the essence for completion of
the Work in accordance with this Agreement. The Developer agrees to achieve
Substantial Completion of the Project on or before the expiration of the
Contract Time. The Developer agrees to achieve Final Completion of the Project
on or before the Guaranteed Final Completion Date.
ARTICLE 5
DEVELOPER'S DUTIES AND RESPONSIBILITIES
5.1 GENERAL
5.1.1 BUILDING PERMIT. From and after the Execution Date, the Developer
shall use its best efforts to obtain the building permit for the Project and
satisfy the requirements set forth in Sections 3.1.4 and 3.1.5 of this Agreement
as soon as possible. Notwithstanding anything contained in this Agreement to the
contrary, in the event the Developer has not satisfied the requirements set
forth in Sections 3.1.4 and 3.1.5 of the Agreement, obtained a building permit
for the Project prior to the Closing Date and issued the Notice to Proceed
required under paragraph 4.2 of the Construction Contract prior to the Closing
Date, then, at the Agent's option, this Agreement may be terminated whereupon
this Agreement shall be of no further force or
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effect, and the parties shall be released from all further obligations
hereunder; provided, however, the Developer shall pay to the Agent any monies
paid by the Agent in connection with the Purchase Contract and this Agreement
including, without limitation, the Two Hundred Ten Thousand and No/100 Dollars
($210,000.00) deposit, and Twenty-eight Thousand Six Hundred Thirty-seven and
No/100 Dollars ($28,637.00) less Eighty Thousand and No/100 Dollars
($80,000.00).
5.1.2 CONTRACTS. The Developer shall have the right to negotiate and to
execute in its name, all contracts and agreements for the Project, including,
without limitation, the Design Contract and the Construction Contract. The final
forms of the Design Contract and the Construction Contract shall be subject to
the approval of the Agent, which approval shall not be unreasonably withheld or
delayed, and such contracts shall not be amended without the Agent's prior
consents thereto.
5.1.3 CURB CUT/MEDIAN CUT. The Developer shall use its best efforts to
obtain all governmental permits and approvals required in order to allow design
and construction of the necessary curb cuts and median cuts required for direct
ingress and egress to and from the Site for westbound traffic on S.W. 72nd
Street.
5.1.4 TRANSMISSION LINES. The Developer shall retain the services of a
consultant which will develop design and construction solutions in order to
ensure that the operation of the Agent's business operations at the Site,
including, without limitation, telephone, computer and other telecommunication
services (the "Business Operations") are not affected by the existence of the
Florida Power and Light transmission lines and equipment located on or adjacent
to the Site (the "FPL Facilities"). The costs and expenses incurred in
connection with any work required to be done in connection with the Project in
order to ensure that the FPL Facilities do not affect the Agent's Business
Operations at the Site shall be included in the Budgeted Amount, but shall not
be paid from the Change Order Contingency.
5.2 DEVELOPER'S SERVICES
5.2.1 PHASE I SERVICES.
5.2.1.1 Within fourteen (14) days from the Execution
Date, the Developer shall prepare, or cause others to
prepare, and submit to the Agent, for the Agent's
acceptance, an initial plan of development consisting
of, among other things, the Conceptual Drawings, the
Outline Specifications, the Development Schedule, and
the Budget (the "Phase I Plan of Development"). Upon
receipt of a complete Phase I Plan of Development
from the Developer, the Agent shall have fourteen
(14) days to review same (the "Phase I Review
Period"). On or before the expiration of the Phase I
Review Period, the Agent shall either: (i) accept the
Phase I Plan of Development by transmitting written
notice of acceptance to the Developer, or (ii)
transmit, in writing, its review comments to the
Developer. Upon the receipt of such review comments
by the Developer, but in no event later than fourteen
(14) days from the date of receipt by the Developer
of such review comments, the Developer shall
incorporate such review comments into the Phase I
Plan of Development or shall notify the Agent, in
writing, that such review comments, if it is the
case, cannot be incorporated into the Phase I Plan of
Development because such review comments, if
incorporated into the Phase I Plan of Development,
would have a material and adverse impact upon the
Project (a "Phase I Issue"). In the event that the
Developer incorporates such review comments into the
Phase I Plan of Development, the Developer shall
resubmit the Phase I Plan of Development to the
Agent, and the above-described process of the Agent's
review and the Developer's revisions will continue
until the Agent accepts the Phase I Plan of
Development; provided, however, the Agent, in
connection with its review of any comments, may not
include any new review comments unrelated to those
that were previously provided in its prior comments
to the Phase I Plan of Development. Additionally, if
the Agent fails to provide its
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review comments within the appropriate Phase I Review
Period, the Phase I Plan of Development shall be
deemed accepted upon the expiration of the most
current Phase I Review Period, except as to any
unaddressed review comments remaining from any prior
Phase I Review Period. In the event of the occurrence
of a Phase I Issue, the Agent shall be entitled to
avail itself of the dispute resolution procedure set
forth in this Agreement to resolve such a Phase I
Issue. The Phase I Plan of Development shall be
deemed to have been accepted by the Agent upon the
later of: (1) the date of receipt by the Developer of
written notices of acceptance of the Phase I Plan of
Development from the Agent, or (2) in the event that
the Agent avails itself of the dispute resolution
process, the date that the dispute is decided or
settled.
5.2.1.b The Developer shall take all other actions reasonably
necessary to perform, or cause others to perform, its
obligations set forth in this Agreement.
5.2.1.3 Prior to proceeding to the Phase II Services,
the Developer shall confirm to the Agent, in writing,
that: (i) the Developer will achieve Substantial
Completion of the Project on or before the expiration
of the Contract Time; (ii) the Developer will achieve
Final Completion of the Project on or before the
Guaranteed Final Completion Date; (iii) the Developer
will complete the Project within the Budgeted Amount,
unless increased due to Change Orders or Construction
Change Directives in excess of the Change Order
Contingency; and (iv) the Developer will complete the
Work, by itself or through others, for an amount not
to exceed the Guaranteed Maximum Construction Price,
unless increased due to Change Orders or Construction
Change Directives in excess of the Change Order
Contingency.
5.2.2 PHASE II SERVICES.
5.2.2.1 Within fourteen (14) days from the date of
the Agent's acceptance of the Phase I Plan of
Development, the Developer shall prepare, or cause
others to prepare, and submit to the Agent, for the
Agent's acceptance, an updated plan of development
consisting of, among other things, the Design
Development Documents, a revised Development
Schedule, and a revised Budget (the "Phase II Plan of
Development"). Upon receipt of a complete Phase II
Plan of Development from the Developer, the Agent
shall have fourteen (14) days to review same (the
"Phase II Review Period"). On or before the
expiration of the Phase II Review Period, the Agent
shall either: (i) accept the Phase II Plan of
Development by transmitting a written notice of
acceptance to the Developer, or (ii) transmit, in
writing, its review comments to the Developer. Upon
the receipt of such review comments by the Developer,
but in no event later than fourteen (14) days from
the date of receipt by the Developer of such review
comments, the Developer shall incorporate such review
comments into the Phase II Plan of Development or
shall notify the Agent, in writing, that such review
comments, if it is the case, cannot be incorporated
into the Phase II Plan of Development because such
review comments, if incorporated into the Phase II
Plan of Development, would have a material and
adverse impact upon the Project (a "Phase II Issue").
In the event that the Developer incorporates such
review comments into the Phase II Plan of
Development, the Developer shall resubmit the Phase
II Plan of Development to the Agent and the
above-described process of the Agent's review and the
Developer's revisions will continue until the Agent
accepts the Phase II Plan of Development; provided,
however, the Agent, in connection with its review of
any comments, may not include any new review comments
unrelated to those that were previously provided in
its prior comments to the Phase II Plan of
Development. Additionally, if the Agent fails to
provide its review comments within the appropriate
Phase II Review Period, the Phase II Plan of
Development shall be deemed accepted
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upon the expiration of most current Phase II Review
Period, except as to any unaddressed review comments
remaining from any prior Phase II Review Period. In
the event of the occurrence of a Phase II Issue, the
Agent shall be entitled to avail itself of the
dispute resolution procedure set forth in this
Agreement to resolve such Phase II Issue. The Phase
II Plan of Development shall be deemed to have been
accepted by the Agent upon the later of: (1) the date
of receipt by the Developer of written notice of
acceptance of the Phase II Plan of Development from
the Agent, or (2) in the event that the Agent avails
itself of the dispute resolution process, the date
that the dispute is decided or settled.
5.2.2.2 The Developer shall take all other actions reasonably
necessary to perform, or cause others to perform, its
obligations set forth in this Agreement.
5.2.2.3 Prior to proceeding to the Phase III
Services, the Developer shall confirm to the Agent,
in writing, that: (i) the Developer will achieve
Substantial Completion of the Project on or before
the expiration of the Contract Time; (ii) the
Developer will achieve Final Completion of the
Project on or before the Guaranteed Final Completion
Date; (iii) the Developer will complete the Project
within the Budgeted Amount, unless increased due to
Change Orders or Construction Change Directives in
excess of the Change Order Contingency; and (iv) the
Developer will complete the Work, by itself or
through others, for an amount not to exceed the
Guaranteed Maximum Construction Price, unless
increased due to Change Orders or Construction Change
Directives in excess of the Change Order Contingency.
5.2.3 PHASE III SERVICES.
5.2.3.1 Within fourteen (14) days from the Agent's
acceptance of the Phase II Plan of Development, the
Developer shall prepare, or cause others to prepare,
and submit to the Agent, for the Agent's acceptance,
a further updated plan of development consisting of,
among other things, the final Drawings and
Specifications, a revised Development Schedule, and a
revised Budget (the "Final Plan of Development").
Upon receipt of a complete Final Plan of Development
from the Developer, the Agent shall have fourteen
(14) days to review same (the "Final Review Period").
On or before the expiration of the Final Review
Period, the Agent shall either: (i) accept the Final
Plan of Development by transmitting a written notice
of acceptance to the Developer, or (ii) transmit, in
writing, its review comments to the Developer. Upon
the receipt of such review comments by the Developer,
but in no event later than fourteen (14) days from
the date of receipt by the Developer of such review
comments, the Developer shall incorporate such review
comments into the Final Plan of Development or shall
notify the Agent, in writing, that such review
comments, if it is the case, cannot be incorporated
into the Final Plan of Development because such
review comments, if incorporated into the Final Plan
of Development, would have a material and adverse
impact upon the Project (a "Phase III Issue"). In the
event that the Developer incorporates such review
comments into the Final Plan of Development, the
Developer shall resubmit the Final Plan of
Development to the Agent and the above-described
process of the Agent's review and the Developer's
revisions will continue until the Agent accepts the
Final Plan of Development; provided, however, the
Agent, in connection with its review of any comments,
may not include any new review comments unrelated to
those that were previously provided in its prior
comments to the Final Plan of Development.
Additionally, if the Agent fails to provide its
review comments within the appropriate Final Review
Period, the Final Plan of Development shall be deemed
accepted upon the expiration of the most current
Final Review Period, except as to any unaddressed
review
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comments remaining from any prior Final Review
Period. In the event that the Developer notifies the
Agent of the occurrence of a Phase III Issue, the
Agent shall be entitled to avail itself of the
dispute resolution procedure set forth in this
Agreement to resolve such Phase III Issue. The Final
Plan of Development shall be deemed to have been
accepted by the Agent upon the later of: (1) the date
of receipt by the Developer of written notice of
acceptance of the Final Plan of Development from the
Agent, or (2) in the event that the Agent avails
itself of the dispute resolution process, the date
that the dispute is decided or settled.
5.2.3.2 The Developer shall take all other actions reasonably
necessary to perform, or cause others to perform, its
obligations set forth in this Agreement.
5.2.3.3 Prior to proceeding to the Phase IV Services,
the Developer shall confirm, to the Agent, in
writing, that: (i) the Developer will achieve
Substantial Completion of the Project on or before
the expiration of the Contract Time; (ii) the
Developer will achieve Final Completion of the
Project on or before the Guaranteed Final Completion
Date; (iii) the Developer will complete the Project
within the Budgeted Amount, unless increased due to
Change Orders or Construction Change Directives in
excess of the Change Order Contingency; and (iv) the
Developer will complete the Work, by itself or
through others, for an amount not to exceed the
Guaranteed Maximum Construction Price, unless
increased due to Change Orders or Construction Change
Directives in excess of the Change Order Contingency.
5.2.4 PHASE IV SERVICES.
5.2.4.1 The Developer shall construct the Project, or cause
the Project to be constructed by others, in
accordance with the Final Plan of Development.
5.2.4.2 The Developer shall provide construction
administration services and be solely responsible
for, and have control over, the construction means,
methods, techniques, sequences and procedures
affecting the Work, and coordinate all portions of
the Project, so that, (i) the Developer will achieve
Substantial Completion of the Project on or before
the expiration of the Contract Time; (ii) the
Developer will achieve Final Completion of the
Project on or before the Guaranteed Final Completion
Date; (iii) the Developer will complete the Project
within the Budgeted Amount, unless increased due to
Change Orders and Construction Change Directives in
excess of the Change Order Contingency; and (iv) the
Developer will complete the Work, by itself or
through others, for an amount not to exceed the
Guaranteed Maximum Construction Price, unless
increased due to Change Orders and Construction
Change Directives in excess of the Change Order
Contingency.
5.2.4.3 The Developer shall take all other actions reasonably
necessary to perform its obligations set forth in
this Agreement.
5.3 INTENDED THIRD-PARTY BENEFICIARY STATUS. The Developer agrees to name the
Owner, the Agent and the Lender as intended third-party beneficiaries in the
Design Contract, in the Construction Contract, and in any consultant agreements.
Further, the Developer agrees to require the Architect, the Contractor and any
consultant to name the Owner, the Agent and the Lender as intended third-party
beneficiaries in any subconsultant agreement or subcontract, as the case may be,
made by and between any Architect and any subconsultant, made by and between any
Contractor and any Subcontractor, or made by and between any consultant and any
subconsultant. The Developer shall contractually obligate the Contractor to name
the Owner, the Agent, and the Lender as co-obligees on the Contractor's
performance bond and its labor and material payment bond, if any, as required
pursuant to the Construction Contract. In the event that such a
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Contractor's performance bond and labor and material payment bond are required
by the Owner for the Project, the premiums for such bonds shall be payable from
the Change Order Contingency.
5.4 ACCESS AND AUDITS. As part of its obligations, Developer shall maintain, for
purposes of accounting and audit under this Agreement, complete and accurate
accounts and original records, from the Developer, the Contractor, the Architect
and any other persons or entities engaged with respect to this Agreement,
reflecting all of the transactions of the Project to justify all charges,
expenses and costs constituting the Cost of the Work and as otherwise may be
incurred by the Developer in performing all of its obligations under this
Agreement. The accounts and records will be kept in accordance with generally
accepted accounting principles for a period of three (3) years after Final
Completion. Such books and records shall be adequate to provide the Agent with
all financial information as may be needed by the Agent for the purposes of
satisfying the financial reporting obligations of the Agent.
5.5 OWNERSHIP OF DOCUMENTS. On or before the Guaranteed Final Completion Date,
or the Effective Termination Date, whichever is earlier, the Developer shall
deliver to the Agent, two (2) copies of such documents and materials received
by, or otherwise in the possession of, the Developer, prepared by the Architect,
the Contractor or any other persons or entities engaged with respect to this
Agreement. All such documents and materials shall be and remain the Agent's
property, and the Developer hereby agrees that such documents and materials
shall not be subject to any claims or rights of others, including copyright
claims.
5.6 DEVELOPER'S REPRESENTATIONS AND WARRANTIES. The Developer hereby warrants
and represents to the Agent that the Developer is duly organized, validly
existing and in good standing under the laws of the State of Florida; the
Developer has full power and authority to carry on its business as presently
being conducted and as contemplated to be conducted hereunder and to execute,
deliver and perform its obligations under this Agreement; the Developer has
received Twenty-eight Thousand Six Hundred Thirty-seven and No/100 Dollars
($28,637.00) of the Project Soft Costs, Two Hundred Ten Thousand and No/100
Dollars ($210,000.00) of deposits for the Seller toward the Purchase Price, and
the person(s) executing this Agreement on behalf of the Developer have been duly
authorized to execute and deliver this Agreement on behalf of the Developer.
5.7 DEVELOPER'S COVENANTS.
5.7.1 Commencing on September 15, 1997 and continuing until the
Developer has achieved Substantial Completion of the Project, the Developer
shall provide the Agent with Temporary Space pursuant to a sublease to be
entered into by and between the Developer, as subtenant and Blue Cross and Blue
Shield of Florida, Inc., a Florida not-for-profit corporation, as sublandlord,
on mutually acceptable terms and conditions (the "Sublease"). The Sublease shall
provide, among other things, that the rental cost, including the base rent and
any and all additional rents associated with such Temporary Space, the cost of
all utilities serving the Temporary Space for the duration of the Agent's
tenancy, shall be paid by the Developer, provided that an Event of Agent's
Default does not occur, until the earlier of (i) fifteen (15) days after the
date the Agent receives written notice from the Architect that the Developer has
achieved Substantial Completion or (ii) October 11, 1998, subject to extension
for the same period of any Authorized Extensions not caused directly by the
Agent. The Agent shall pay for all moving and relocation costs of the Agent. In
the event that the Developer has not achieved Substantial Completion of the
Project by OCTOBER 11, 1998, subject to extension for the same period of any
Authorized Extensions not caused directly by the Agent, then the Agent shall be
entitled to remain in the Temporary Space on the same terms and conditions as
set forth in the Sublease, except the Agent shall pay the Developer a sum in the
amount of Twenty-eight Thousand Two Hundred Eighteen and 67/100 Dollars
($28,218.67) plus applicable sales tax per month for its use of the Temporary
Space. Prior to occupancy of the Temporary Space, the Agent shall provide, at
its sole cost, the insurance coverages described on EXHIBIT I attached hereto.
Within five (5) days after the Execution Date, the Developer shall provide a
copy of the proposed Sublease to the Agent along with a written consent from the
Developer's landlord for the Agent to occupy such Temporary Space. Within
fifteen (15) days after Substantial Completion, the Agent shall vacate the
Temporary Space and leave same in the same condition as it existed upon
commencement of the Agent's occupancy, reasonable wear and tear excepted. The
parties acknowledge and agree that
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Developer's covenant as set forth herein is a material inducement to the Agent
to enter into this Agreement. In the event the Developer fails to deliver
occupancy of the Temporary Space to the Agent on September 15, 1997 as required
pursuant to this Agreement and the Sublease, the Developer shall pay to the
Agent the sum of One Thousand and No/100 Dollars ($1,000.00) per day, for each
and every day until the earlier of: (i) the date that the Temporary Space is
made available for the Agent's proper use and occupancy in accordance herewith
and in accordance with the Sublease; or (ii) the date of Substantial Completion,
except for days of Authorized Extensions due to an event of Force Majeure.
5.7.2 The Developer shall comply with Public Laws in the performance of
its obligations under this Agreement and shall cause the Architect, the
Contractor and any other persons or entities engaged with respect to this
Agreement to comply with Public Laws.
5.7.3 The Developer shall, by itself or through others, construct and
complete the Project in accordance with the Final Plan of Development. The
Developer shall perform its obligations hereunder, including the Work, by itself
or through others, in strict accordance with this Agreement, the Construction
Contract Documents, including the Drawings and Specifications, and within the
Guaranteed Maximum Construction Price. The Developer shall achieve Substantial
Completion of the Project, by itself or through others, on or before the
expiration of the Contract Time. The Developer shall achieve Final Completion of
the Project on or before the Guaranteed Final Completion Date. Subject to the
terms and provisions of this Agreement, the Developer shall complete the Project
within the Budgeted Amount and the Developer shall complete the Work, by itself
or through others, for a sum that does not exceed the Guaranteed Maximum
Construction Price. In the event that the Work is completed for a sum that is
less than the Guaranteed Maximum Construction Price, all savings shall accrue to
the benefit of the Agent.
5.8 DEVELOPER'S DECISION AUTHORITY. All decisions to be made by the Developer
shall be made by O. Ford Gibson, Eric D. Swanson, or Robert G. Ferranti or such
other person designated by the Developer, by providing such person's name in
writing to the Agent as provided in Section 10.1 below.
ARTICLE 6
AGENT'S RIGHTS, DUTIES AND RESPONSIBILITIES
6.1 GENERAL
From and after the date the Owner acquires the Site, the Agent shall
make the Site available to the Developer and shall: (i) execute such documents
and agreements as may be necessary to: give sufficient and unrestricted access
to the Developer to the Site in order to enable the Developer to carry out the
functions described herein for the development and construction of the Project;
(ii) provide the Developer with copies of all relevant documents and agreements,
within the possession of the Agent, as may be reasonably necessary to enable
Developer to perform its functions hereunder; and (iii) obtain financing from a
financial institution (the "Lender"), for the development and construction of
the Project as outlined in the Budget for an amount no less than the Budgeted
Amount and upon request by the Developer, the Agent shall provide a copy of the
Lender's commitment letter for the Project to the Developer.
6.2 AGENT'S REPRESENTATIONS AND WARRANTIES.
6.2.1 The Agent hereby warrants and represents the following to the
Developer:
6.2.1.1 That the Agent is duly organized, validly existing
and in good standing under the laws of the State of
Florida;
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6.2.1.2 That the Agent has full power and authority to carry
on its business as presently being conducted and as
contemplated to be conducted hereunder and to
execute, deliver and perform its obligations under
this Agreement;
6.2.1.3 That the Agent will provide such documents and
instruments in its possession or control that are
necessary to effectuate the purposes hereunder,
provided that such provision creates no additional
cost or expense for the Agent that is not included in
the Budget.
6.2.2 The Agent hereby represents and warrants that Eighty Thousand and
No/100 Dollars ($80,000.00) of the Total Project Cost that has been paid by the
Agent shall not be returned or refunded by the Developer to the Agent.
6.3 CHANGES IN THE WORK.
The Agent may, at any time, without invalidating this Agreement make
Changes in the Work pursuant to a Change Order or Construction Change Directive.
6.3.1 CHANGE ORDERS.
Except as otherwise provided herein, no extra work or changes to the
Work (including, without limitation, changes in the Scope of Work, the Contract
Time, the Guaranteed Final Completion Date, the Guaranteed Maximum Construction
Price, the Budgeted Amount or any other term or condition of this Agreement) (a
"Change") shall be made except in accordance with a duly issued written change
order authorizing such Change ("Change Order"), notwithstanding the course of
dealing between, or the course of performance of, the parties or industry
standards. All Change Orders shall be executed in writing by the Agent and the
Developer. A Change Order shall constitute a final settlement on all items
covered therein, including any compensation for impact on, or delay or
acceleration in, the schedule for performing the Work.
6.3.2 CHANGE PROPOSALS.
In connection with any Change requested by the Agent, the Developer
shall, within seven (7) days following its receipt of a written request for a
Change, submit, in writing, to the Agent, a Change proposal for accomplishing
such Change which Change proposal shall reflect the total cost and additional
time, if any, for such Change under this Agreement.
Any Change proposal submitted shall state the total cost and additional
time, if any, for such Change, including, but not limited to (a) materials
costs; (b) labor costs, by trade; (c) construction equipment rental costs, if
any; (d) overhead and profit, if any, in accordance with the provisions of
Section 6.3.4; (e) changes to the Development Schedule, if any; and, (f) a
detailed description of any and all impacts the Change may have on any
activities on the critical path of the Development Schedule, except for a Change
proposal for a Change estimated to cost Three Thousand and No/100 Dollars
($3,000.00) or less, which shall be submitted as a lump-sum total cost amount,
showing (i) the Cost of the Work and (ii) the overhead/profit for such proposed
Change as separate line-items of such lump-sum total cost amount, and shall
include additional time, if any, proposed for such Change (a "Minor Change
Proposal"). The Agent shall respond to such Change proposal within seven (7)
days following its receipt of such Change proposal.
6.3.3 CONSTRUCTION CHANGE DIRECTIVES.
(a) If the Agent and the Developer are unable to agree
upon the terms of a Change Order and therefore fail
to execute a Change Order, the Agent may, in writing,
without invalidating this Agreement, order Changes in
the Scope of the Work, consisting of additions or
deletions thereto (a "Construction Change
Directive").
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(b) In the event that the Agent issue a Construction
Change Directive to the Developer, the Guaranteed
Maximum Construction Price shall be increased or
decreased, as the case may be, by adding to the
Guaranteed Maximum Construction Price the
substantiated Cost of the Work performed as a result
of the Change and subtracting from the Guaranteed
Maximum Construction Price the Cost of the Work for
any Work avoided as a result of the Change. Overhead,
including general conditions, and profit, if any,
attributable to the Change shall be calculated in
accordance with this Section 6.3. The Developer, in
its reasonable discretion, shall furnish competing
bids or proposals for all such Changes.
(c) Except for a Change Order issued from a Minor
Change Proposal, the Developer shall keep and
present, in a manner consistent with good
construction practices, an itemized accounting and
appropriate original supporting data substantiating
the costs expended in connection with any Change and
provide same to the Agent to accompany the
appropriate Construction Change Directive or Change
Order, as the case may be, the form of which is
attached hereto and made a part hereof as EXHIBIT P.
Costs, for which the Developer shall be entitled to
be compensated pursuant to a Change, shall be the
following direct costs necessarily incurred in the
performance of the Work pursuant to such Change,
which costs shall be at rates not higher than the
standard paid at the place of the Project, except
with the prior written consent of the Agent: (i)
direct labor costs; (ii) equipment costs; and (iii)
material costs, as such costs are submitted by the
subcontractor performing or, if appropriate, the
Contractor who is self-performing, the Work pursuant
to the Change or as such costs are set forth in the
R.L. Means publication current at the time the Work
pursuant to such Change is performed, whichever is
less.
6.3.4 OVERHEAD AND PROFIT ATTRIBUTABLE TO CHANGES.
Notwithstanding anything contained herein to the contrary, for purposes
of any and all additive Changes made pursuant to this Section 6.3, the total
additional amount that may be charged by the Developer for overhead, including
general conditions, and profit for any additive Change in the Work, for a
subcontractor who is performing the Work pursuant to such Change, shall be ten
percent (10%) of the cost of the Change and for the Contractor, five percent
(5%) of the cost of such Change, for a combined maximum total additional amount
of fifteen percent (15%) of the cost of such Change. If Work pursuant to a
Change is self-performed by the Contractor, then the total overhead, including
general conditions, and profit for any additive Change in the Work shall be
fifteen percent (15%) of the cost of the Change.
No additional overhead profit, fee, or any other sum in connection with
any Change shall be compensable to the Developer, unless, when calculated at the
time of Final Completion, the sum of all additive Changes minus the sum of all
deductive Changes equals an amount that is in excess of the Change Order
Contingency (the "Aggregate Excess Amount"). In such event, the Development Fee
shall be subject to increase upon the agreement of the Agent and the Developer,
provided, however, in no event shall the increase in the Development Fee exceed
four and three tenths percent (4.3%) of such Aggregate Excess Amount.
Notwithstanding any provisions to the contrary contained in this
Agreement or in the Construction Contract Documents, for purposes of this
Section 6.3, "overhead and profit" shall mean all costs attributable to the
Change, other than the direct cost of labor and materials and increased
insurance and bond premium costs directly attributable to the Change, including,
without limitation, the Developer's, the Contractor's and any Subcontractor's
Change Order processing costs, clerical costs, home office overhead costs,
administrative costs, field office overhead costs, the Development Fee, the
Contractor's Fee and other costs attributable to such Change.
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Notwithstanding anything contained herein to the contrary, in the event
of a contemporaneous deductive and additive Change in the Work relating to the
same component, system or division of the Work, the overhead and profit shall be
calculated on the basis of the net cost of the Change (I.E., the difference
between the cost of the Change for the additive Change in the Work and the cost
of the Change for the deductive Change in the Work).
For any deductive Changes, there shall be a reduction in the Guaranteed
Maximum Construction Price equal to the value of the deductive Change and the
Contract Time shall be reduced, if at all, by a period equivalent to the number
of days that such a deductive Change removes from the critical path of the most
current Development Schedule.
6.3.5 DUTY TO CONTINUE WORK.
During the pendency of any dispute with respect to any proposed Change,
the Developer shall continue to perform its obligation under this Agreement,
regardless of the cause of the dispute and whether or not any extension of the
Contract Time may be granted; provided, however, the Developer shall be paid in
accordance with the terms of this Agreement, any undisputed amounts, as and when
due.
6.3.6 PERFORMANCE OF WORK INCORPORATED BY CHANGE ORDER OR
CONSTRUCTION CHANGE DIRECTIVE.
The Developer shall perform, or cause others to perform, Work
incorporated by Change Order or Construction Change Directive so as to ensure
that all dates set forth in the Development Schedule, as may be amended from
time to time by mutual agreement of the Agent and the Developer, will be
satisfied.
6.4 AGENT'S DECISION AUTHORITY. All of the Agent's decisions shall be made by
Larry Signora, or such other person designated by the Agent, by providing such
person's name, in writing, to the Developer as provided in Section 10.1 below.
ARTICLE 7
OWNER'S PAYMENTS
7.1 PAYMENTS.
The Agent shall cause payment to be made by the Owner in current funds
for the Total Project Cost, which shall, in no event, exceed the Budgeted
Amount. The Total Project Cost includes: the Development Fee, which shall not be
subject to increase or decrease in the event that there is a Change in the Scope
of the Work, unless increased in accordance with Section 6.3.4, due to an
Aggregate Excess Amount; the Project Soft Costs; the Purchase Price to the
Seller in accordance with this Agreement; the Closing Costs; and, the
Construction Contract Sum, all as set forth in the Budget as such Budget may be
amended from time to time in accordance with the terms of this Agreement.
Notwithstanding anything contained in this Agreement to the contrary, prior to
the earlier of December 15, 1997 or the date the Owner acquires title to the
Site, amounts payable for the Project, directly by the Agent, are limited to the
Agent's Maximum Payment, subject, however, to the Developer's obligation to
return monies to the Agent as provided in Sections 3.2, 5.1 and elsewhere in
this Agreement.
7.1.1 APPLICATION OF SAVINGS. Prior to the Agent's acceptance of the
Budget that is part of the Final Plan of Development, in the event that the cost
of a line item in the Budget is determined to be less than the amount that is
indicated in the Budget for such line item, subject to the approval of the
Agent, the Developer may apply the difference between the budgeted amount of
such line item and the actual, substantiated cost of such line item (the
"Savings") to another line item in the Budget, subject to the following
conditions: (i) for Savings in a line item of the Guaranteed Maximum
Construction Price portion of the Budget, only an amount of Savings that is less
than or equal to five percent (5%) of the budgeted amount of such line item may
be applied to the Project Soft Costs portion of the Budget; and (ii) for Savings
in a line item of the Project Soft
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Costs portion of the Budget, an unlimited amount of such Savings may be applied
to the Guaranteed Maximum Construction Price portion of the Budget.
Notwithstanding the foregoing, the Purchase Price and the Change Order
Contingency line items of the Budget shall, in no event, be subject to this
Savings provision.
7.2 CONSTRUCTION CONTRACT COSTS. The Construction Contract Sum includes
the following:
7.2.1 CONTRACTOR'S FEES. The Developer acknowledges and agrees that the
Contractor's Fee shall be included in the Construction Contract Sum and shall
incorporate all of the Contractor's profit relating to the proper performance of
the Developer's obligation to complete the Work under this Agreement. Under no
circumstance shall the Agent be responsible or liable to the Developer for any
additional fees relating to the Work, except to the extent expressly set forth
in this Agreement.
7.2.2 COST OF THE WORK. The Developer acknowledges and agrees that the
Cost of the Work shall be limited to actual and direct expenditures reasonably
and necessarily incurred in the performance of the Work in the categories of
cost set forth in EXHIBIT M. The Developer acknowledges and agrees that the
Contractor's General Conditions Cost shall include certain expenditures
reasonably and necessarily incurred in the performance of the Work in the
categories set forth in EXHIBIT N.
The Developer further acknowledges and agrees that the Cost of the Work for the
Project shall, in no event, include any categories of cost that are not
expressly set forth on EXHIBIT M or EXHIBIT N, or any costs that would cause the
Guaranteed Maximum Construction Price to be exceeded unless due to Change Orders
or Construction Change Directives in excess of the Change Order Contingency, and
that the Developer will cause the Contractor to submit as part of the
Construction Contract and to update with each of the Contractor's applications
for payment, a Schedule of Values (as defined in the Construction Contract) that
allocates the Cost of the Work among the categories set forth in EXHIBIT M and
EXHIBIT N.
7.3 TIME OF COMPLETION.
7.3.1 BONUS. The Developer shall achieve Substantial Completion of the
Project within the Contract Time. Subject to the terms of this paragraph, in the
event that the Date of Substantial Completion is a date earlier than June 1,
1998 (the "Bonus Date"), the Agent shall be obligated to pay to the Developer,
as a bonus the sum of One Thousand Six Hundred Sixty-six and No/100 Dollars
($1,666.00) per day, for each and every day by which the Date of Substantial
Completion precedes the Bonus Date. Notwithstanding anything contained herein,
or elsewhere in the Agreement, to the contrary, in no event shall (a) the Agent
be obligated to the Developer for the payment of a bonus in excess of the amount
of One Hundred Thousand and No/100 Dollars ($100,000.00) or (b) the Bonus Date
be extended, unless an Authorized Extension is granted (i) for a delay for which
the Agent is directly responsible or (ii) for a delay caused by an Event of
Force Majeure, in which case the maximum number of days by which the Bonus Date
may extended is sixty (60) days.
7.3.2 LIQUIDATED DAMAGES. The Agent and the Developer agree and
acknowledge that the Agent shall suffer substantial damages in the event that
the Developer fails to achieve Substantial Completion of the Project, by itself
or through others, within the Contract Time. The Agent's damages are not readily
ascertainable as of the date of this Agreement. Therefore, if the Developer
fails to achieve Substantial Completion of the Project, by itself or through
others, within the Contract Time, the Developer shall be obligated to pay to the
Agent: (a) as liquidated and agreed damages, and not as a penalty, liquidated
damages in the amount of One Thousand Six Hundred Sixty-six and No/100 Dollars
($1,666.00) per day, for each and every day that the Developer fails to achieve
Substantial Completion within the initial thirty (30) days beyond the expiration
of the Contract Time (the "Initial LD Period") (b) as liquidated and agreed
damages, and not as a penalty, liquidated damages in the amount of Three
Thousand Three Hundred Thirty-three and No/100 Dollars ($3,333.00) per day, for
each and every day that the Developer fails to achieve Substantial Completion
within the thirty (30) days beyond the expiration of the Initial LD Period (the
"Second LD Period") and (c) as liquidated and agreed damages, and not as a
penalty, liquidated damages in the amount of Four Thousand Five Hundred and
No/100 Dollars ($4,500.00) per day, for each and every day that the Developer
fails to
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achieve Substantial Completion within the seventy-two (72) days beyond the
expiration of the Second LD Period (the "Third LD Period"). The Developer shall,
in no event, be obligated to the Agent for the payment of liquidated damages in
excess of Four Hundred Seventy-Four Thousand and No/100 Dollars ($474,000.00).
In the event that the Developer fails to achieve Substantial Completion prior to
the expiration of the Third LD Period, the liquidated damages provision shall be
null and void and of no further force or effect and the Agent shall be entitled
to recover from the Developer actual damages, meaning damages caused by the
Developer's delay in achieving Substantial Completion, including any necessary
rental and moving expenses incurred by the Agent and reasonable attorneys' fees
and expert witness fees, but excluding other consequential damages which accrue
after the expiration of the Contract Time. The Developer expressly agrees that
the Agent shall have the right to deduct any amounts due for liquidated damages
or actual damages from any and all amounts required to be paid by the Agent
under this Agreement.
7.4 PROGRESS PAYMENTS.
7.4.1 Based upon applications for payment which shall be submitted to
the Agent by the Developer including all original supporting documentation
reasonably requested by the Agent ("Application for Payment"), the Agent shall
make progress payments on account of the Development Fee, Project Soft Costs,
and the Construction Contract Sum, to the Developer as herein provided. The
period covered by each Application for Payment shall be one calendar month
ending on the 30th day of the month. On or before the 10th day of the following
month, the Developer shall submit to the Agent, for approval, an Application for
Payment: (i) on account of the Development Fee based on the Development Fee
Payment Schedule attached hereto and made a part hereof as EXHIBIT Q, which
payment schedule is subject to modification in the event that there is a
material delay in the progress of the Work, or the Agent reasonably believes
that the Project may be otherwise materially and adversely affected; (ii) on
account of Project Soft Costs, for Project Soft Costs reasonably and necessarily
incurred during such month, based upon original invoices and other documentation
of such expenditures, in form and content satisfactory to the Agent; and, (iii)
on account of the Construction Contract Sum based on the amount certified by the
Architect, subject to the approval of the Agent, to be due and owing to the
Contractor. Provided an Application for Payment is received by the Agent no
later than the 10th day of the month following the month covered by such
Application for Payment, the Agent shall cause payment due to Developer
hereunder to be made to the Developer no later than the 25th day of the same
month. If an Application for Payment is received by the Agent after the 10th day
of any such month, payment otherwise due to the Developer pursuant to the
Agreement shall not be made until 30 days after such Application for Payment is
received.
7.4.2 As a condition precedent to the Agent's obligation to make
progress payments, the Developer expressly agrees that the Developer shall
furnish to the Agent, for the Developer, the Architect, consultants, the
Contractor and all Subcontractors, material suppliers and laborers, at any tier,
who provided services or furnished labor, materials or equipment during the
payment period, and who is defined as a "Lienor" pursuant to Section 713.01,
Florida Statutes, partial waivers and releases, in the total amount of the
previous progress payment, in the respective forms therefor, attached hereto and
made a part hereof as EXHIBIT K, an updated Development Schedule, and an updated
Schedule of Values (as defined in the Construction Contract and as required of
the Contractor by the terms of the Construction Contract).
7.4.3 With respect to each Application for Payment, the Agent shall be
entitled to retain ten percent (10%) of the Development Fee throughout the
duration of the Project, and ten percent (10%) of the Construction Contract Sum
for the payment of the first fifty percent (50%) of the Construction Contract
Sum by trade, to assure the faithful performance of the Work and the other
obligations hereunder by the Developer. If the Project is on schedule and the
Agent has not identified any defect or deficiency in the quality of the Project,
and the Lender and the Surety have no objections to a reduction in retainage for
the Project, five percent (5%) of the Construction Contract Sum retainage shall
be held by the Agent, on account, for the Developer for the payment of the
second fifty percent (50%) of the Construction Contract Sum by trade; provided,
however, the Agent shall have no obligation to reduce the ten percent (10%)
retainage of the Construction Contract Sum. In the event that there is a
material delay in the progress of the Work or the Agent
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reasonably believes that the Project may be otherwise materially and adversely
affected at any time during the performance of Work for the second fifty percent
(50%) of the Project by trade, the Agent shall have the right to increase the
amount held as retainage, up to the value of ten percent (10%) of the Work in
place plus ten percent (10%) of the Development Fee previously paid, to offset
any prior reduction in retainage. Additionally, the Agent in no way waives its
right to demand proper performance of the Work or other services for the
Project, whether or not any reduction in retainage is allowed. Any retainage due
to the Developer shall be paid to the Developer at the time of final payment,
after Final Completion. The Project Soft Costs are not subject to retainage.
7.4.4 Upon the Execution Date, Developer shall be entitled to receive
an initial draw for the Project Soft Costs, as outlined on EXHIBIT J attached
hereto, upon submission of an Application for Payment in accordance with Section
7.4.1.
7.4.5 When the Developer, by itself or through others, has achieved
Substantial Completion of the Project, the Developer shall cause the Architect
to issue a certificate of Substantial Completion. Prior to issuance of a
certificate of Substantial Completion and prior to occupancy by the Agent,
however, the Agent and the Developer, shall jointly inspect the Work and shall
prepare a list of all items required by the Agent to be completed or corrected
by, or on behalf of, the Developer for the Agent's approval (the "Punch List").
The Punch List shall be provided to the Developer within ten (10) business days
after such inspection and the Punch List Work shall be completed within
forty-five (45) days from issuance of the Punch List. Such inspection, however,
shall not relieve the Developer from responsibility to correct any defective
Work or to complete any incomplete Work.
7.5 FINAL COMPLETION.
7.5.1 Final payment constituting the entire unpaid balance of the Total
Project Cost shall be made by the Agent to the Developer within ten (10) days
after the date of Final Completion. Final Completion shall not be deemed to have
occurred until the last to occur of the following:
(a) the submission to the Agent by the Developer of true
and correct copies of all permits, certificates of
inspection and other approvals by governing
authorities which are required for a final
certificate of occupancy and use of the Project;
(b) the completion of the Punch List and the final
cleaning of the Work by, or through, the Developer,
to the Agent's satisfaction;
(c) the submission to the Agent by the Developer, of the
record Drawings and Specifications, including
Computer Aided Design (CAD) disks, therefor;
(d) the submission to the Agent by the Developer of
notarized, fully executed final releases and waivers
from the Developer, the Architect, its consultants,
the Contractor and all Subcontractors and material
suppliers, at any tier, who provided services or
furnished labor, materials or equipment for the
Project and who is defined as a "Lienor" pursuant to
Section 713.01, Florida Statutes, in the respective
forms therefor, attached hereto and made a part
hereof as EXHIBIT K, or a bond, satisfactory to the
Agent, to indemnify the Agent from any claim of any
such potential lienor;
(e) the submission to the Agent by the Developer of
reasonable proof of payment of fees, taxes or similar
obligations, if any, imposed upon the Developer, the
Contractor and any Subcontractor, at any tier;
(f) the delivery to the Agent by the Developer of all
operational, access, security and similar facilities,
and all operation and maintenance manuals for the
Project and
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evidence of all warranties required pursuant to the
Construction Contract Documents and any additional
warranties obtained in connection with the Work;
(g) the removal from the Project by the Developer of all
temporary facilities, tools and similar items;
(h) the submission to the Agent by the Developer of the
consent of the surety, if any, to final payment to
the Contractor;
(i) the submission to the Agent by the Developer of an
updated and complete list of names, addresses and
telephone numbers and contact persons of the
Contractor and of all Subcontractors, at every tier
(collectively (a)-(i) constitute "Final Completion").
7.6 DELAYS.
For the purposes of this Agreement, causes beyond the Developer's
control shall mean only those causes permitted pursuant to the terms of this
paragraph and no other causes. Should the Developer be delayed, interfered with,
or hindered in the commencement, prosecution or completion of the Project by the
act, omission, neglect or default of the Agent or of anyone employed by the
Agent, or by an Event of Force Majeure, then the Developer shall be entitled to
an extension of the Contract Time and the Guaranteed Final Completion Date for
the time lost by reason of any of the aforesaid causes ("Authorized Extension");
provided, however, the Developer shall not be entitled to any such Authorized
Extension unless the Developer: (a) delivers notice to the Agent in writing of
the cause or causes of such delay, interference or hindrance within five (5)
business days of the date that the Developer becomes aware or reasonably should
have become aware that a delay would be occasioned thereby, (b) could not have
reasonably anticipated or avoided such delay, interference or hindrance, and (c)
has used reasonable means to minimize the consequences of any such delay,
interference or hindrance. In no event shall an extension of the Contract Time
and the Guaranteed Final Completion Date be granted to the Developer that is
based upon a request from the Contractor unless the activity for which such an
extension is requested is on the critical path of the most current revision of
the Development Schedule that was submitted by the Developer to, and accepted
by, the Agent prior to the occurrence of the event for which the extension is
requested; provided, however, an extension of the Contract Time and the
Guaranteed Final Completion Date may be granted if the activity for which such
an extension is requested is not on the critical path of the most current
revision of the Development Schedule, but the delay causes the activity to fall
on the critical path and there is no reasonable alternative to schedule such
activity off the critical path. The Developer agrees and acknowledges that no
ground for delay or adjustment of the Contract Time and the Guaranteed Final
Completion Date shall arise as a result of any reasonably foreseeable condition
at the Site or anything contained in the Construction Contract Documents. The
Developer's sole and exclusive remedy for a claim of delay, interference or
hindrance in the commencement, prosecution or completion of the Project shall be
an extension of the Contract Time and the Guaranteed Final Completion Date to
the extent permitted pursuant to this Section 7.6; provided, however, in the
event of a termination for convenience in accordance with Section 9.4 of this
Agreement, payment shall be made in accordance therewith.
7.7 SITE CONDITIONS
By commencing services under this Agreement, the Developer accepts the
Site in its then existing condition, the Developer expressly waives any right to
additional compensation, and other claims that may arise, due, in whole or in
part, to Site conditions, including, without limitation, subsurface and
environmental conditions.
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ARTICLE 8
INSURANCE AND INDEMNIFICATION
8.1 INSURANCE. The Developer shall, at a minimum, procure and maintain, at its
own expense, or cause to be procured and maintained, throughout the performance
of its services pursuant to this Agreement, the following insurance from
insurance companies that (a) have a general policyholder's rating of not less
than "A" and a financial rating of not less than "VIII" in the most current
Best's Key Rating Guide and (b) are authorized to do business in the State of
Florida:
8.1.1 WORKER'S COMPENSATION INSURANCE. The Developer shall procure and
maintain workers' compensation insurance at the statutory limit and in
accordance with the laws of the State of Florida, and Employer's Liability
Insurance, with limits equivalent to not less than Five Hundred Thousand and
No/100 Dollars ($500,000.00).
8.1.2 COMMERCIAL GENERAL LIABILITY INSURANCE. The Developer shall
procure and maintain comprehensive commercial general liability insurance as
provided herein, including, without limitation, coverage for: (i)
Premises/Operations; (ii) Independent Contractors' cross-liability for vicarious
liability of the Developer, for acts of other
consultants/subcontractors/sub-consultants; (iii) Contractual Liability; (iv)
Product/Completed Operations; (v) XCU (explosion, collapse, underground perils)
Hazards; (vi) Personal Injury Liability (no employee exclusions, except the
fellow-employee exclusion, provided, however, owners, partners, and officers are
considered employees); and, (vii) Broad Form Property Damage; with limits of at
least One Million and No/100 Dollars ($1,000,000.00) per occurrence and a
Twenty-five Million and No/100 Dollars ($25,000,000.00) policy aggregate. This
insurance must be written on an occurrence basis and must be maintained in full
force and effect for at least one (1) year after Final Completion.
8.1.3 COMPREHENSIVE AUTOMOBILE LIABILITY. The Developer shall procure
and maintain comprehensive automobile liability insurance, covering all owned,
leased, non-owned, borrowed and hired vehicles used in connection with this
Agreement, on an occurrence basis and with limits of not less than One Million
and No/100 Dollars ($1,000,000.00) per occurrence.
8.1.4 UMBRELLA LIABILITY INSURANCE. The Developer shall procure and
maintain umbrella liability insurance, including, without limitation, coverage
for all perils covered by the Employers Liability Insurance, Commercial General
Liability Insurance and Comprehensive Automobile Liability Insurance described
above, with limits of at least Twenty-five Million and No/100 Dollars
($25,000,000.00) per occurrence and Twenty- five Million and No/100 Dollars
($25,000,000.00) policy aggregate. This insurance must be written on an
occurrence basis, state that the State of Florida is the policy territory, apply
to occurrences and suits anywhere in the world, and be maintained in full force
and effect for at least one (1) year following Final Completion.
8.1.5 PROFESSIONAL LIABILITY INSURANCE. The Developer shall cause the
Architect, and the Architect's consultants, to procure and maintain as provided
herein, professional liability insurance, including, without limitation,
insurance covering errors and omissions in the performance of professional
duties that may occur in connection with the Project, or any portion thereof,
with policy limits of not less than One Million and No/100 Dollars
($1,000,000.00) per claim/annual aggregate. The Developer shall cause the
Architect to be obligated to pay any deductible, which deductible amount shall
not exceed One Hundred Twenty-five Thousand and No/Dollars ($125,000.00). The
Developer shall cause the Architect to maintain claims-made coverage in similar
amounts for one (1) year following Final Completion.
8.1.6 BUILDER'S RISK INSURANCE. The Developer shall procure or caused
to be procured and maintain builder's risk insurance, insuring the interest of
the Owner, the Agent, the Contractor, the Subcontractors, at any tier, and other
persons or interests as the Agent may designate, in writing, against all risks
of direct physical loss of, or damage to, the Project, subject to the
exclusions, limitations, terms, and conditions of the Developer's insurance
policy. The policy(ies) for such Builder's Risk insurance shall be secured and
maintained by the Developer in form acceptable to the Agent and shall contain
waivers of subrogation in favor of the Developer, the Contractor and all
Subcontractors at any tier.
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Coverage applies to all materials, supplies and equipment that are consumed on,
or intended for specific installation in, the Project while such materials,
supplies, and equipment are located at the Site.
Coverage will be written on a replacement cost basis.
Although the Agent is not obligated to reimburse the Developer for the cost of
any materials or equipment until such materials and equipment have been
delivered and suitably stored at the Site for incorporation in the Work,
coverage shall apply for transit and storage away from the Site.
The Agent shall not be liable or responsible for any loss or damage whatsoever
in connection with any and all items not insured or underinsured under the
Builder's Risk coverage.
The Builder's Risk insurance policy shall provide that any loss insured under
this Section 8.1 shall be adjusted with the Developer and made payable to the
Developer as fiduciary for the insureds, as their interests may appear, subject
to the requirements of any applicable mortgagee clause. The Developer shall pay
the Contractor, and shall cause the Contractor to pay the Subcontractors, their
just shares of any insurance moneys received. The Developer, as fiduciary, shall
have power to adjust and settle any loss(es) with insurers.
8.2 All of the foregoing insurance provided or caused to be provided by the
Developer shall: (i) be primary to any and all of the insurance carried by the
Agent, and the Agent's insurance shall be in excess of, and not contribute with,
the insurance provided by the Developer; and (ii) contain provisions entitling
the Developer to waive its rights of recovery against any person or entity
before loss.
8.3 Before commencing the services under this Agreement, the Developer shall
furnish a certificate, satisfactory to the Agent, substantially in the form
attached to this Agreement and made a part hereof as EXHIBIT L, from each
insurance company showing that the above insurance is in force, stating policy
numbers, dates of expiration, and limits of liability thereunder, and
disclaiming the existence of any riders except those specifically described
therein. The certificate and the above policies of insurance shall further
provide that the insurance will not be canceled, changed, non-renewed or allowed
to expire until the expiration of at least thirty (30) days after written notice
of such cancellation, change, non-renewal or expiration has been received by the
Agent.
8.4 The Agent, the Owner and the Lender shall be specifically listed as
additional insureds on the Commercial General Liability Insurance policy, the
Automobile Liability Insurance policy, and any umbrella policies which may be
applicable to the Project. The Developer shall deliver to the Agent a
certificate, acceptable to the Agent, identifying the additional insureds in
accordance with the requirements hereof.
8.5 The Developer shall require the Architect and the Contractor, and require
the Contractor to require its Subcontractors, to maintain insurance as required
in Sections 8.1.1, 8.1.2, 8.1.3 and 8.1.4, unless otherwise agreed, in writing,
by the Agent.
8.6 The Developer shall pay all deductible amounts and all costs not covered
because of any deductibles with respect to all policies of insurance required
herein.
8.7 WAIVER. The Developer hereby waives any right of recovery for an insurable
loss under the foregoing insurance that it may have at any time against the
Agent and the Lender (including any of the other additional insureds hereunder),
to the extent of coverage by the foregoing insurance, whether or not actually
provided by the Developer. The Agent hereby waives its right of recovery for an
insurable loss under the foregoing insurance against the Developer, but only to
the extent of coverage by the foregoing insurance.
8.8 NO LIMITATION ON LIABILITY. The limits of the aforementioned insurance
coverages described in this Article 8, to be provided by the Developer and any
other persons or entities, shall not in any manner be construed to be a
limitation on the liabilities or obligations of the Developer, the Architect,
the Contractor or any Subcontractor, at any tier.
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8.9 FAILURE TO MAINTAIN. If the Developer fails to maintain any insurance
required hereunder at any time during the performance of the services under this
Agreement, the Agent shall have the right, but not the obligation, to procure
and maintain such insurance for, and in the name of, the Developer, and the
Developer shall pay the reasonable cost thereof and shall furnish all necessary
information to make effective and maintain such insurance. The Agent, at its
sole option, may deduct the cost of procuring and maintaining such insurance
from any balance due to the Developer under this Agreement.
8.10 BONDS. If required by the Lender, the Developer shall cause the Contractor
to procure a Performance Bond and a Labor and Material Payment Bond to secure
the performance and payment obligations of the Contractor. The Performance Bond
and the Labor and Material Payment Bond shall be in the forms attached hereto
and made a part hereof as EXHIBIT O, and shall be written in the amount of the
Guaranteed Maximum Construction Price or such lesser amount required by the
Lender and the premium therefor shall be payable from the Change Order
Contingency.
8.11 INDEMNITY. For and in consideration of the sum of Ten and No/100 Dollars
($10.00) and other good and valuable consideration, the Developer shall defend,
indemnify and hold the Agent and the Owner, their officers, directors,
shareholders, partners, sureties, insurers, employees, agents or servants
(individually, the "Indemnitee," collectively, the "Indemnitees") harmless from
and against any and all claims, damages, liabilities, suits and costs of every
kind and description, including reasonable attorneys' fees, experts' fees, and
court costs at the pre-trial, trial and appellate levels, and from and against
any and all damages for which any Indemnitee may be liable, to the extent caused
by the Developer's acts or omissions, related to, arising out of or in
connection with the Project, or the Developer's negligence, including, without
limitation, damages for injury or death to persons or damage to property. In
addition to any other remedies available to the Indemnitees at law or in equity,
in the event that any claim for costs or damages is made against the Indemnitees
or the Developer with respect to, arising out of or in connection with the
Project, the Developer acknowledges and agrees that such portion of the Total
Project Cost that may be, or become, due to the Developer, as reasonably may be
considered necessary by the Agent to discharge any obligation under this
indemnity provision, shall be retained by the Agent on account of the Developer
until the entry of a final non-appealable order of a court of competent
jurisdiction disposing of such claim and directing the disbursement of such
amount.
ARTICLE 9
DISPUTE RESOLUTION; DEFAULT; SUSPENSION; TERMINATION
9.1 DISPUTE RESOLUTION. The Developer and the Agent agree to make every
reasonable effort to resolve any dispute under this Agreement prior to any
party's proceeding to terminate this Agreement due to a default by any other
party. Accordingly, in the event of a dispute related to the performance of the
Developer or the Agent under this Agreement, the Developer and the Agent agree
not to exercise their respective termination rights until written notice,
stating the cause or event giving rise to such termination, is delivered to the
other party, and representatives of both parties have met and failed to resolve
the dispute within fourteen (14) days following such notice; provided, however,
the parties shall endeavor to resolve a payment dispute within five (5) business
days following such notice.
9.2 EVENTS OF DEVELOPER'S DEFAULT. The following shall be "Events of
Developer's Default":
9.2.1 The filing by the Developer or the Contractor of a petition
commencing a voluntary proceeding under the Federal Bankruptcy Code or any other
federal, state or local law or statute pertaining to bankruptcy or insolvency; a
general assignment by the Developer or the Contractor for the benefit of
creditors; an admission in writing by the Developer or the Contractor of its
inability to pay debts as they become due; the filing by the Developer or the
Contractor of any petition or answer in any proceeding seeking for itself, or
consenting to, or acquiescing in any insolvency, receivership or similar relief
under any laws pertaining to bankruptcy or insolvency, or the filing by the
Developer or the Contractor of an answer or other pleading admitting or failing
to deny, or to contest, the material allegations of a petition filed against it
in any such proceeding; the seeking or consenting to, or acquiescence by the
Developer or the Contractor in the
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appointment of any custodian, trustee, receiver or liquidator of it, or any part
of its property; and the commencement against the Developer or the Contractor of
an involuntary proceeding under the Federal Bankruptcy Code, or a proceeding
under any law or statute pertaining to insolvency, which case or proceeding is
not dismissed or vacated within ninety (90) days; or
9.2.2 The failure of the Developer or the Contractor in the performance
of any material obligations under this Agreement or the Construction Contract,
provided that the Agent has provided the Developer with written notice of such
failure, specifying with detail, the nature of such failure, and such failure is
not cured within fourteen (14) days following the receipt by the Developer of
such written notice from the Agent, or, provided that such failure cannot be
cured within such fourteen (14)-day period, if the Developer does not commence
to cure such failure within such fourteen (14)-day period and thereafter
diligently pursue the cure of such failure.
9.3 EVENTS OF AGENT'S DEFAULT. The following shall be "Events of Agent's
Default":
9.3.1 The failure of the Agent to pay the Developer amounts due to the
Developer under this Agreement, as and when due, provided that the Developer has
provided to the Agent written notice of such failure, and such failure continues
for fifteen (15) days after the receipt by the Agent of such written notice; or
9.3.2 The failure of the Agent in the performance of any material
obligations under this Agreement, provided that the Developer has provided the
Agent with written notice of such failure, specifying with detail, the nature of
such failure, and such failure is not cured within fourteen (14) days following
the receipt by the Agent of such written notice from the Developer, or, provided
that such failure cannot be cured within such fourteen (14)-day period, if the
Agent does not commence to cure such failure within such fourteen (14)-day
period and thereafter diligently pursue the cure of such failure.
9.4 TERMINATION FOR CONVENIENCE. The Agent may terminate this Agreement without
cause at any time by the giving of written notice to the Developer at least
seven (7) days prior to the effective date of termination specified in such
notice (the "Notice of Termination"). After receipt of such Notice of
Termination, the Developer shall suspend all services under this Agreement,
including, but not limited to, the Work on the date specified in such Notice of
Termination and shall by itself, or through others: (a) terminate all orders and
subcontracts chargeable to the performance of this Agreement, which may be
terminated without costs; (b) terminate and settle, subject to approval of the
Agent, other orders and subcontracts where the cost of settlement will be less
than costs which would be incurred were such orders and subcontracts to be
completed; and (c) transfer to the Agent, in accordance with the Agent's
directions, all materials, supplies, Work in progress, facilities, equipment,
machinery or tools acquired by the Developer and the Contractor in connection
with the performance of the Work and for which the Developer is to be reimbursed
hereunder, and all Drawings, working drawings, sketches, Specifications and
information accumulated for use in the performance of the Work. The Developer
shall by itself, or through others, if directed by the Agent and to the extent
stated in the Notice of Termination, do such work as may be necessary to
preserve the Work in progress and to protect materials and equipment at the Site
or in transit thereto. If the Agent terminates this Agreement in accordance with
this Section on or before the date the Developer has obtained the building
permit for the Project, the Developer shall be paid an additional amount, if
necessary, so that the aggregate sum of the portion of the Development Fee
payable to the Developer equals Two Hundred Thousand and No/100 Dollars
($200,000.00). If the Agent terminates this Agreement in accordance with this
Section after the date the Developer has obtained the building permit and on or
before the "dry-in" of the building on the Site is accomplished, the Developer
shall be paid an additional amount, if necessary, so that the aggregate sum of
the portion of the Development Fee payable to the Developer equals Three Hundred
Twenty-five Thousand and No/100 Dollars ($325,000.00). If the Agent terminates
this Agreement in accordance with this Section after the date the Developer has
"dried-in" the building on the Site, but on or before Final Completion, the
Developer shall be paid an additional amount, if necessary, so that the
aggregate sum of the Development Fee payable to the Developer equals Four
Hundred Seventy-five Thousand and No/100 Dollars ($475,000.00). Notwithstanding
anything contained herein to the contrary, the Agent's obligation for any
payment of any portion of the Development Fee shall be of no force or effect in
the event the Project is terminated by the
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Agent for any cause attributable, in whole or in part to the Developer, the
Architect, or the Contractor, or any other person or entity under contract with,
or under the employ or control of, any of them.
9.5 SUSPENSION. The Agent may, without cause, suspend or delay the Project in
whole or in part and for such period as it may determine, at any time by the
giving of written notice to the Developer at least three (3) days prior to the
effective date of suspension specified in such notice (the "Notice of
Suspension"). After receipt of such Notice of Suspension, the Developer shall
suspend all services under this Agreement, including, but not limited to, the
Work on the date specified in such Notice of Suspension. In such event, an
appropriate and equitable adjustment to the Contract Time and the Guaranteed
Maximum Construction Price (if necessary), shall be made by the Agent, provided
that no such adjustments shall be made if performance is or was suspended or
delayed by another cause for which the Developer, or any person or entity under
the Developer's control, including the Contractor and the Architect, was in
whole or in part responsible. In the event of a suspension of the Project by the
Agent for a period in excess of three (3) consecutive months that (i) is not
attributable to an event of Force Majeure, and (ii) is due directly to any cause
within the control of the Agent, upon the expiration of such 3-month period, the
Developer may, in writing, request that the Agent consider such suspension to be
a termination for convenience and upon such written request and the Agent's
agreement therewith, the Project shall be terminated in accordance with Section
9.4 of this Agreement and payment shall be made in accordance therewith.
9.6 REMEDIES. If an Event of Developer's Default or an Event of the Agent's
Default occurs, the non-defaulting party may terminate this Agreement upon
providing written notice of termination to the defaulting party, subject to the
provisions of Section 9.1 hereof. Termination shall be effective seven (7) days
after the defaulting party has received such notice of termination (the
"Effective Termination Date"); provided, however, such seven (7)-day period
shall not be deemed to be a cure period. In addition to such right of
termination, the non-defaulting party shall have all other remedies available to
it at law or equity, as a result of such default, subject to any specific
limitations set forth in this Agreement.
9.7 TERMINATION AND ASSIGNMENT. In the event of termination of this Agreement or
the nullification of this Agreement in accordance with this Article 9 or Section
5.1.1, the Developer shall not be entitled to any additional compensation beyond
that which has been paid or is then presently due and owing pursuant this
Agreement by the Agent to the Developer. The Developer hereby assigns, transfers
and sets over to and grants all of the Developer's right, title and interest in
and to the Construction Contract, the Design Contract, and any other agreement
that the Developer enters into that is related to the Project, together with all
amendments, addenda, supplements, modifications, Change Orders, Construction
Change Directives, and extensions thereto, whether made now or hereafter
(collectively, the "Contracts") to the Agent (the "Assignment"). The Developer
shall, in the Contracts, obtain the respective written consents of the
Contractor and the Architect to this Assignment and shall cause the Contractor
and the Architect to obtain the written consents of each of its subcontractors
and Consultants for the Project, as the case may be, to this Assignment. The
Agent may exercise its rights under this Assignment upon the occurrence of an
Event of Developer's Default or a Termination for Convenience. Immediately upon
written notice to the Developer, made as provided in this Agreement, that the
Agent is exercising its rights hereunder, the Agent shall succeed to all the
Developer's right, title and interest in and to the Contracts; provided,
however, the Agent does not hereby assume any of the Developer's obligations or
duties under or in connection with the Contracts until and unless the Agent
shall exercise its rights hereunder.
ARTICLE 10
MISCELLANEOUS PROVISIONS
10.1 NOTICE. Any notice required to be given hereunder shall be in writing and
mailed, postage prepaid, by United States Certified or Registered Mail, Return
Receipt Requested, telecopied or dispatched by overnight courier, and shall be
deemed given on the earliest to occur of (a) receipt thereof, (b) three (3) days
after the day on which same was deposited in the United States Postal Service
with proper postage affixed, or (c) the day following the delivery of such
overnight delivery service, addressed
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to the parties as follows, unless a different address is later designated by any
party by furnishing written notice of such change to the other parties under
this notice provision:
For notice to the Developer:
CODINA DEVELOPMENT CORPORATION
Two Alhambra Plaza
PH II
Coral Gables, FL 33134
Attn: Eric Swanson
With copies to the same address to the attention of: Ford Gibson and
Robert Ferranti
With a copy to:
BERMAN WOLFE & RENNART
100 S.E. 2nd Street, 35th Floor
Miami, FL 33131
Attn: Leon J. Wolfe, Esq.
For notice to the Agent:
THE VINCAM GROUP, INC.
2850 Douglas Road
Coral Gables, FL 33134
Attn: General Counsel
With copies to the same address to the attention of: Stephen Waechter
and Raphael Peruyera
With a copy to:
STEEL HECTOR & DAVIS LLP
200 South Biscayne Blvd.
Miami, FL 33131
Attn: Jorge Diaz-Silveira, P.A.
10.2 ASSIGNMENT. Subject to the Developer's obligation to enter into the Design
Contract with Architect and to enter into the Construction Contract with the
Contractor as provided in Article 5 hereof, this Agreement is for the
professional services of the Developer and may not be assigned by the Developer
without the prior written consent of the Agent, which consent may not be
unreasonably withheld. Except as required by the Owner or the Lender, the Agent
shall not be entitled to assign this Agreement without the prior written consent
of the Developer, which consent may not be unreasonably withheld. Subject to the
foregoing, this Agreement shall inure to the benefit of, and be binding upon,
the parties hereto and their respective successors and assigns.
10.3 GOVERNING LAW AND VENUE. This Agreement shall be governed by, construed and
enforced in accordance with the laws of the State of Florida. The parties
acknowledge that personal jurisdiction upon proper service will be valid in the
State of Florida, and that venue of all actions arising out of or related to
this Agreement shall be proper only in Dade County, Florida, and shall be
brought either in the Circuit Court in and for Dade County, Florida or the
United States District Court for the Southern District of Florida.
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10.4 WAIVER OF JURY TRIAL. THE PARTIES HERETO EACH HEREBY KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVE THE RIGHT EACH MAY HAVE TO A TRIAL BY JURY WITH RESPECT
TO ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH,
THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
ORAL OR WRITTEN) OR ACTIONS OF ANY PARTY TO THIS AGREEMENT. THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE AGENT AND THE DEVELOPER TO ENTER INTO THIS
AGREEMENT.
10.5 CONSTRUCTION. In construing this Agreement, feminine or neuter pronouns
shall be substituted for those masculine in form and vice versa, and plural
terms shall be substituted for singular and singular for plural in any place in
which the context so requires.
10.6 BINDING EFFECT. The covenants, terms, conditions, provisions and
undertakings in this Agreement, shall extend to and be binding upon the legal
representatives, successors and assigns of the respective parties hereto as if
they were in every case named and expressed and wherever reference is made to
any of the parties hereto, it shall be held to include and apply also to the
legal representatives, successors and assigns of such party as if in each and
every case so expressed.
10.7 FURTHER INSTRUMENTS. The parties agree to execute and deliver any
instruments in writing necessary to carry out any agreement, term, condition or
assurance in this Agreement whenever the occasion shall arise and request for
such instrument shall be made.
10.8 INTEGRATION AND MERGER. This Agreement shall constitute the full and
complete understanding between the parties as to the matters addressed herein.
There are no oral understandings, terms or conditions, and no party has relied
on any representation, express or implied, not contained in this Agreement. All
prior understandings, terms or conditions, with any party to this Agreement, are
deemed to merge in this Agreement, and this Agreement cannot be changed or
supplemented except by an agreement in writing and signed by all of the parties
to this Agreement.
10.9 SEVERABILITY. If any provisions of this Agreement shall be declared invalid
or unenforceable, the remainder of the Agreement shall continue in full force
and effect.
10.10 COMPLIANCE WITH LAWS. None of the parties hereto shall in any manner,
directly or indirectly, violate any Public Laws in connection with the
performance of their respective obligations under the terms of this Agreement.
10.11 EXHIBITS. All exhibits referenced in this Agreement are incorporated into
this Agreement by such reference and shall be deemed to be an integral part of
this Agreement; provided, however, the terms of this Agreement shall govern and
control to the extent of any inconsistency or conflict between this Agreement
and an exhibit.
10.12 ATTORNEYS' FEES. In the event of litigation arising under, or in
connection with, this Agreement, the prevailing party shall be entitled to
recover its reasonable attorneys' fees, expert fees, and costs, from the
non-prevailing party and at the hearing pre-trial, trial and appellate levels.
This provision shall survive the termination of this Agreement for any reason.
10.13 SURVIVAL. The warranties and indemnities set forth in this Agreement shall
survive the termination or nullification of this Agreement.
10.14 AMENDMENTS. No change, amendment or modification of this Agreement shall
be valid or binding upon the parties hereto unless such change, amendment, or
modification shall be in writing and duly
29
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executed by all parties hereto. No change, amendment or modification of this
Agreement shall be deemed to be made by any party on the basis of any action or
failure to act by any party or by the course of performance, course of dealing,
or course of conduct of any party.
10.15 CAPTIONS. The captions contained in this Agreement are for convenience of
reference only and in no way define, describe, extend or limit the scope or
intent of this Agreement or the intent of any provision contained herein.
10.16 NO WAIVER. Any waiver by any party of a breach of any provision of this
Agreement shall not operate as, or be construed to be, a waiver of any other
breach of such provision or of any breach of any other provision of this
Agreement. The failure of a party to insist upon strict adherence to any term of
this Agreement on one or more occasions shall neither be considered a waiver nor
deprive that party of any right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing and
signed by the party to be charged therewith.
10.17 COUNTERPARTS. Provided that all parties hereto execute an original of this
Agreement, this Agreement may be executed in counterparts, each of which shall
be deemed an original and all of which together shall constitute one and the
same instrument.
10.18 NO AGENCY. It is understood and agreed that the Developer is acting as an
independent contractor in the performance of its services hereunder, and nothing
herein contained shall be deemed to create an agency relationship between the
Agent and the Developer.
10.19 REAL ESTATE BROKERS. The Agent and the Developer represent and warrant to
each other that they have not dealt with any broker in connection with the
transaction contemplated by this Agreement other than Codina Bush Klein - ONCOR
International ("CBKO") for which the Developer shall pay a brokerage fee
pursuant to a separate agreement with CBKO. The Agent and the Developer, each to
the other, agrees to indemnify and hold the other harmless from and against any
and all costs or liabilities, including reasonable attorneys' fees, and expert
fees, whether incurred in, pretrial, trial or appellate levels, for brokerage or
professional service fees claimed by any broker employed or claiming to have
been employed by such party. This Section 10.19 shall survive the termination or
nullification of this Agreement.
The fees due to the undersigned CBKO brokers shall be paid as follows: Two
Hundred Forty-two Thousand Eight Hundred Seventy-eight and 32/100 Dollars
($242,878.32) upon execution of the Agreement and the balance upon Substantial
Completion.
10.20 CALENDAR DAY. Unless otherwise specified in this Agreement, any reference
to "days" shall refer to calendar days.
10.21 PAYMENT BY AGENT. With respect to all payment obligations of the Agent
contained in this Agreement, the Agent is acting solely as the agent for the
Owner, and not in any other capacity, and the Agent shall, in no event, be
responsible for payment of any sum of money for this Project in excess of the
Agent's Maximum Payment.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in six (6) counterparts, each of which shall constitute an original and
all of which, taken together, shall constitute a single instrument, by and
through their duly authorized representatives, as of the date first written
above.
DEVELOPER:
Signed, sealed and delivered in CODINA DEVELOPMENT
the presence of: CORPORATION, a Florida corporation
/S/ ROBERT G. FERRANTI By: /S/ O. FORD GIBSON
- -------------------------- -------------------------------
Name: Robert G. Ferranti O. Ford Gibson, President
/S/ CARMEN C. CASTILLO
- --------------------------
Name: Carmen C. Castillo
AGENT:
THE VINCAM GROUP, INC., a Florida
corporation
/S/ WILLIAM H. HOLLY By: /S/ STEPHEN L. WAECHTER
- -------------------------- -----------------------------
Name: William H. Holly Name: Stephen L. Waechter
Title: CFO
/S/ ELIZABETH J. KEELER
- --------------------------
Name: Elizabeth J. Keeler
/s/ Robert Garcia
- --------------------------
Robert Garcia
31
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JOINDER BY CODINA BUSH KLEIN ONCOR INTERNATIONAL
Codina Bush Klein Oncor International is executing this Agreement solely for the
purpose of acknowledging and agreeing that the fee due to them in connection
with the transaction contemplated by this Agreement shall be an amount equal to
six percent (6%) of the actual amount of (i) the total Project hard costs and
(ii) the following Project Soft Costs: Shell Architect's Fee, T.I. Drawings,
Engineers & Consultants, Reimbursables and Impact/Permit Fees.
CODINA BUSH KLEIN ONCOR INTERNATIONAL,
a Florida corporation
Signed, sealed and delivered
in the presence of:
/S/ ROBERT GARCIA By: /S/ WILLIAM H. HOLLY
- -------------------------- ----------------------------
Name: Robert Garcia William H. Holly
/S/ ELIZABETH J. KEELER
- --------------------------
Name: Elizabeth J. Keeler
/S/ SUSAN STERN By: /S/ TERE BLANCA DE ULLOA
- -------------------------- ----------------------------
Name: Susan Stern Tere Blanca de Ulloa
/S/ PAT KELLY
- ---------------------------
Name: Pat Kelly
32
