<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 3, 1994
Registration No. 33-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
--------------------------------
NEWMONT GOLD COMPANY
(Exact name of Registrant as specified in its charter)
--------------------------------
<TABLE>
<S> <C> <C>
Delaware 1700 Lincoln Street 13-2526632
(State or other jurisdiction of DENVER, COLORADO 80203 (I.R.S. Employer
incorporation or organization) (303) 863-7414 Identification No.)
</TABLE>
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
-----------------------------------
Timothy J. Schmitt, Esq.
Newmont Mining Corporation
1700 Lincoln Street
Denver, Colorado 80203
(303) 863-7414
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
-------------------------------
<TABLE>
<S> <C> <C>
Copies to:
Maureen Brundage, Esq. Colin Harley, Esq.
White & Case Davis Polk & Wardwell
1155 Avenue of the Americas 450 Lexington Avenue
New York, New York 10036 New York, New York 10017
(212) 819-8200 (212) 450-4000
</TABLE>
---------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box./ /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box./ /
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed maximum Proposed maximum
Title of each class of Amount to be offering price aggregate offering Amount of
securities to be registered registered per unit (1) price (1) registration fee
<S> <C> <C> <C> <C>
Series 1994-A1 and 1994-A2 Pass
Through Certificates...... US$265,000,000 100% US$265,000,000 $91,379.42
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
in accordance with Rule 457 under the Securities Act of 1933, as
amended.
-----------------------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED AUGUST 2, 1994
PROSPECTUS
$265,000,000
NEWMONT GOLD COMPANY
1994-A1 AND 1994-A2 PASS THROUGH TRUSTS
PASS THROUGH CERTIFICATES, SERIES 1994-A1 AND 1994-A2
The Pass Through Certificates offered hereby (the "Pass Through Certificates")
will represent fractional undivided interests in (i) the Newmont Gold Company
1994-A1 Pass Through Trust (the "1994-A1 Trust") and (ii) the Newmont Gold
Company 1994-A2 Pass Through Trust (the "1994-A2 Trust"). The 1994-A1 Trust and
the 1994-A2 Trust are collectively referred to herein as the "Pass Through
Trusts." The Pass Through Trusts are to be formed pursuant to two separate Pass
Through Agreements dated as of July 15, 1994 (each a "Pass Through Agreement")
between Newmont Gold Company, a Delaware corporation (the "Company"), and First
National Bank of Chicago, a national banking association, not individually but
solely as trustee under each Pass Through Trust (the "Pass Through Trustee").
The Pass Through Certificates will initially be represented by permanent global
certificates in fully registered form, deposited with The Depository Trust
Company ("DTC") and registered in the name of DTC's nominee, Cede & Co.
("Cede"). The property of the Pass Through Trusts will consist of notes (the
"Lessor Notes") issued on a nonrecourse basis by the Owner Trustees referred to
below in connection with a leveraged lease financing (the "Financing") of
undivided interests in the Company's refractory gold ore treatment facility
located approximately six miles north of Carlin, Nevada (the "Facility").
Undivided ownership interests in the Facility aggregating 100% will be purchased
by the Owner Trustees and leased to the Company pursuant to two separate leases
(each a "Lease").
The Lessor Notes will be issued under two separate Indentures and Deeds of Trust
(each an "Indenture"), as nonrecourse obligations of Shawmut Bank Connecticut,
National Association, not in its individual capacity, but solely as owner
trustee (each an "Owner Trustee"), with respect to two separate owner trusts
(each an "Owner Trust") established for the benefit of one or more institutional
investors (the "Owner Participants"). The Lessor Notes held by each Pass
Through Trustee will be pledged and assigned as security for the Pass Through
Certificates issued by such Pass Through Trustee. The Lessor Notes issued by
each Owner Trustee will be secured by a lien on and security interest in (i) the
related Lease and the basic rentals and certain other amounts payable by the
Company thereunder and described herein, (ii) the undivided ownership interest
of such Owner Trustee in the Facility, and (iii) assignments by such Owner
Trustee of certain contract rights and other rights described herein.
Although neither the Pass Through Certificates nor the Lessor Notes are direct
obligations of or guaranteed by the Company, the amounts unconditionally payable
by the Company under the Leases will be sufficient to pay in full when due all
payments required to be made on the Lessor Notes held in the Pass Through
Trusts. For each Pass Through Trust, all of the Lessor Notes purchased by the
Pass Through Trustee will have identical interest rates, in each case equal to
the rate applicable to the Pass Through Certificates of such Pass Through Trust,
and will have a maturity date on or before the final distribution date for such
Pass Through Trust. Interest paid on the Lessor Notes held in each Pass Through
Trust will be passed through to the Certificateholders of such Pass Through
Trust on January 5 and July 5 of each year, commencing on July 5, 1995, at the
applicable rate per annum for such Pass Through Trust until the final
distribution date for such Pass Through Trust. Principal paid on the Lessor
<PAGE> 3
Notes held in each Pass Through Trust will be passed through to the
Certificateholders of such Pass Through Trust in accordance with the principal
repayment schedule set forth in "Description of the Indentures -- Scheduled
Payments." The Pass Through Certificates will be in the aggregate principal
amounts, will have the final distribution dates and will bear interest at the
rates shown in the table below.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
NO EMPLOYEE BENEFIT PLAN SUBJECT TO PART 4 OF SUBTITLE B OF TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR PLAN
SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE"), OR ANY TRUST CREATED UNDER ANY SUCH EMPLOYEE BENEFIT PLAN OR PLAN, OR
ANY GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA OR SECTION 414(D)
OF THE CODE) ORGANIZED IN A JURISDICTION HAVING PROHIBITIONS ON TRANSACTIONS
WITH SUCH GOVERNMENTAL PLAN SIMILAR TO THOSE CONTAINED IN SECTION 406 OF ERISA
OR SECTION 4975 OF THE CODE (SUCH EMPLOYEE BENEFIT PLAN, PLAN AND GOVERNMENTAL
PLAN ARE HEREINAFTER COLLECTIVELY REFERRED TO AS AN "ERISA PLAN"), OR A PERSON
TREATED AS HOLDING THE ASSETS OF AN ERISA PLAN, MAY ACQUIRE OR HOLD THE PASS
THROUGH CERTIFICATES. THE PURCHASE OR HOLDING BY ANY PERSON OF ANY PASS
THROUGH CERTIFICATE CONSTITUTES A REPRESENTATION BY SUCH PERSON TO THE COMPANY,
THE OWNER PARTICIPANTS, THE OWNER TRUSTEE, THE INDENTURE TRUSTEE AND THE PASS
THROUGH TRUSTEE THAT SUCH PERSON IS NOT AN ERISA PLAN AND THAT SUCH PERSON IS
NOT ACQUIRING, AND HAS NOT ACQUIRED, SUCH PASS THROUGH CERTIFICATE WITH ASSETS
OF AN ERISA PLAN.
<TABLE>
<CAPTION>
Pass Through Final Principal Interest Price to Discounts and Proceeds to the
Certificates Distribution Amount Rate Investors(1) Commissions(1) Trustee(1)
Date
<S> <C> <C> <C> <C> <C> <C>
1994-A1 , $ % % % %
1994-A2 , $ % % % %
</TABLE>
(1) Underwriting commissions and certain other expenses related to the
offering described herein estimated to be $ will be paid by the
Owner Participants as transaction expenses. All proceeds from the sale of
the Pass Through Certificates will be used by the Pass Through Trustees
for the 1994-A1 Trust and the 1994-A2 Trust to purchase the respective
Lessor Notes from the respective Indenture Trustee.
The Pass Through Certificates are offered subject to receipt and
acceptance by the Underwriters, to prior sale and to the Underwriters' right to
reject any order in whole or in part and to withdraw, cancel or modify the
offer without notice. It is expected that delivery of the Pass Through
Certificates will be made through the facilities of The Depository Trust
Company on or about , 1994.
-2-
<PAGE> 4
SALOMON BROTHERS INC
CHEMICAL SECURITIES INC.
CS FIRST BOSTON
LAZARD FRERES & CO.
The date of this Prospectus is , 1994.
-3-
<PAGE> 5
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in
accordance therewith, files reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy statements and other information can be inspected and copied at the
public reference facilities maintained by the Commission at Judiciary Plaza,
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the following
regional offices of the Commission: Seven World Trade Center, Suite 1300, New
York, New York 10048; Northwestern Atrium Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661. Copies of such material can be obtained
at prescribed rates by writing to the Commission, Public Reference Section, 450
Fifth Street, N.W., Washington, D.C. 20549. Such material can also be
inspected at the offices of the New York Stock Exchange, Inc., 20 Broad Street,
New York, New York 10005 on which exchange the common stock of the Company is
listed.
This Prospectus constitutes part of a registration statement filed by
the Company with the Commission under the Securities Act of 1933, as amended
(the "Securities Act"). This Prospectus omits certain of the information
contained in the registration statement, and reference is hereby made to the
registration statement and to the exhibits relating thereto for further
information with respect to the Company and the Debt Securities offered hereby.
Any statements contained herein concerning the provisions of any document are
not necessarily complete, and, in each instance, reference is made to the copy
of such document filed as an exhibit to the registration statement or otherwise
filed with the Commission. Each such statement is qualified in its entirety by
such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company hereby incorporates by reference in this Prospectus the
Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1993, the Company's Quarterly Report on Form 10-Q for the quarter ended March
31, 1994 and the Company's Current Report on Form 8- K dated April 5, 1994,
which have been filed with the Commission. All documents filed by the Company
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the
date of this Prospectus and prior to the termination of the offering of the
Pass Through Certificates offered hereby shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing of
such documents. Any statement contained herein or in a document all or a
portion of which is incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON, INCLUDING
BENEFICIAL OWNERS, TO WHOM A COPY OF THIS PROSPECTUS HAS BEEN DELIVERED, ON THE
REQUEST OF ANY SUCH PERSON, A COPY OF ANY OR ALL OF THE DOCUMENTS REFERRED TO
ABOVE WHICH HAVE BEEN OR MAY BE INCORPORATED IN THIS PROSPECTUS BY REFERENCE,
OTHER THAN EXHIBITS TO SUCH DOCUMENTS (UNLESS SUCH EXHIBITS ARE SPECIFICALLY
INCORPORATED BY REFERENCE INTO SUCH DOCUMENTS). REQUEST FOR SUCH COPIES SHOULD
BE DIRECTED TO THE OFFICE OF THE SECRETARY, NEWMONT GOLD COMPANY, 1700 LINCOLN
STREET, DENVER, COLORADO 80203, TELEPHONE: (303) 863-7414.
REPORTS TO CERTIFICATEHOLDERS BY THE PASS THROUGH TRUSTEE
The First National Bank of Chicago, as Pass Through Trustee for the
holders of each series of the Pass Through Certificates (the
"Certificateholders"), pursuant to the Pass Through Agreements, will provide to
Certificateholders certain periodic statements concerning distributions made
with respect to the Pass Through Trusts. See "Description of the Pass Through
Certificates -- Statements to Certificateholders."
-4-
<PAGE> 6
PROSPECTUS SUMMARY
The following summary of provisions relating to the Pass Through
Certificates does not purport to be complete and is qualified in its entirety
by the detailed information appearing elsewhere in this Prospectus.
<TABLE>
<S> <C>
Glossary . . . . . . . . . . . Included at the end of this Prospectus as Appendix I is a Glossary of certain of the significant
defined terms used herein.
Pass Through Trusts . . . . . The Newmont Gold Company 1994-A1 and 1994-A2 Pass Through Trusts (the "Pass Through Trusts") will
be formed pursuant to two separate Pass Through Agreements (each a "Pass Through Agreement")
between the Company and The First National Bank of Chicago, not individually but solely as
trustee under such Pass Through Agreement (the "Pass Through Trustee").
Pass Through Trust
Property . . . . . . . . . . . The property of the Trusts will consist of notes (the "Lessor Notes") issued on a nonrecourse
basis by Shawmut Bank Connecticut, National Association, not in its individual capacity, but
solely as owner trustee of two separate owner trusts (each an "Owner Trustee"), in each case for
the benefit of one or more institutional investors (each an "Owner Participant") in connection
with a leveraged lease financing (the "Financing") of undivided interests in the Company's
refractory gold ore treatment facility located approximately six miles north of Carlin, Nevada
(the "Facility"). Undivided ownership interests in the Facility aggregating 100% will be
purchased by the Owner Trustees on behalf of the relevant Owner Participants from the Company and
leased to the Company pursuant to two separate leases (each a "Lease"). The Owner Trustees, as
tenants in common, will lease the land on which the Facility is located (the "Site Interest") and
accept a grant from the Company of an easement relating to the adjacent Company premises (the
adjacent premises, together with the Site Interest, the "Facility Site") pursuant to a ground
lease and easement (the "Ground Lease and Easement"). Pursuant to the Leases, the Owner Trustees
will lease the undivided interests in the Facility, and sublease the Site Interest, to the
Company.
The Lessor Notes will bear interest at the same rate as the interest rate of the Pass Through
Certificates and will be payable as to principal on each Regular Distribution Date for the Pass
Through Certificates in the amounts described under "Description of the Pass Through Certificates
-- Pool Factors." The maturity dates of the Lessor Notes purchased by each of the Pass Through
Trusts will occur on or before the final distribution date applicable to the Pass Through
Certificates issued by such Pass Through Trust. The aggregate principal amount of the Lessor
Notes held in each Pass Through Trust will be the same as
</TABLE>
-5-
<PAGE> 7
<TABLE>
<S> <C>
the aggregate principal amount of the Pass Through Certificates issued by such Pass Through
Trust.
Pass Through Certificates . . . Each Certificate will represent a fractional undivided interest in the related Pass Through
Trust. See "Description of the Pass Through Certificates -- General."
Book-Entry Registration . . . . Each series of Pass Through Certificates will be represented by one or more fully registered
global certificates. Each global certificate will be deposited with, or on behalf of, DTC and
registered in the name of Cede. No person acquiring an interest in the Pass Through Trust will
be entitled to receive a certificated Pass Through Certificate, except to the limited extent
described herein. See "Description of the Pass Through Certificates -- Book-Entry Procedures."
Denominations . . . . . . . . The Pass Through Certificates will be issued in minimum denominations of $1,000 or any integral
multiple of $1,000. Each Pass Through Certificate will represent a pro rata share of the
outstanding principal amount of the Lessor Notes and other property held in the related Pass
Through Trust. See "Description of the Pass Through Certificates -- General."
Average Life . . . . . . . . . The average life for the Series 1994-A1 and Series 1994-A2 Pass Through Certificates will be
years and years, respectively.
Regular Distribution
Dates . . . . . . . . . . . . January 5 and July 5.
Record Dates . . . . . . . . . The fifteenth day preceding a Regular Distribution Date or Special Distribution Date.
Distribution . . . . . . . . . Payments of interest on the Lessor Notes held in each Pass Through Trust are scheduled to be
received by the Pass Through Trustee on January 5 and July 5 of each year, commencing July 5,
1995, and are to be distributed by the Pass Through Trustee to the related Certificateholders on
the Regular Distribution Dates.
Payments of principal on the Lessor Notes are scheduled to be received in specified amounts by
the Pass Through Trustee and are to be distributed to the related Certificateholders in
accordance with the principal repayment schedule set forth in "Description of the Indentures --
Scheduled Payments." For each Pass Through Trust, any payments of principal, Make-Whole Premium
(as defined in "Description of the Indentures -- Prepayment"), if any, or interest, other than
Scheduled Payments, received by the Pass Through Trustee on any of the Lessor Notes held in such
Pass Through Trust will be distributed on the day of any month, except that such
distribution will be made on the date of the receipt of
</TABLE>
-6-
<PAGE> 8
<TABLE>
<S> <C>
proceeds by the Pass Through Trustee in the case of an Event of Loss with respect to the Facility
or a refinancing of the related Lessor Notes (the date of any such distribution, a "Special
Distribution Date" and, together with the Regular Distribution Dates, the "Distribution Dates").
Each Certificateholder will be entitled to receive a pro rata share of any such distribution. If
any Distribution Date is not a Business Day, distributions scheduled to be made on such
Distribution Date may be made on the next succeeding Business Day without additional interest.
(Pass Through Agreement, Section 13.15)
Method of
Distribution . . . . . . . Distributions by the Pass Through Trustee on any Distribution Date will be paid to each
Certificateholder of record of such Pass Through Trust on the applicable record date at its
address appearing on the register maintained for such Pass Through Trust. Under the terms of the
Pass Through Agreement, the Company and the Pass Through Trustee will treat the persons in whose
names the Pass Through Certificates are registered as the owners of such Pass Through
Certificates for the purpose of receiving payments of principal, Make-Whole Premium, if any, and
interest on such Pass Through Certificates and for all other purposes whatsoever. Therefore,
neither the Company nor the Pass Through Trustee has any direct responsibility or liability for
distributions or payments to owners of beneficial interests in the Pass Through Certificates (the
"Certificate Owners") represented by permanent global certificates. With respect to Pass Through
Certificates registered in the name of Cede, as nominee of DTC, distributions by the Pass Through
Trustee, including the final distribution of principal with respect to such Pass Through
Certificates, will be made in same-day funds to DTC. DTC will in turn make distributions in
same-day funds to those participants in DTC who are credited with ownership of such Pass Through
Certificates ("DTC Participants") in amounts proportionate to the principal amount of each such
DTC Participant's respective holdings of beneficial interests in such Pass Through Certificates.
Corresponding payments by the DTC Participants to the Certificate Owners will be the
responsibility of such DTC Participants and will be made in accordance with customary industry
practices. See "Description of the Certificates -- Book-Entry Registration." The final
distribution for each Pass Through Trust, however, will be made only upon presentation and
surrender of the Pass Through Certificates for such Pass Through Trust at the office or agency of
the Pass Through Trustee. The Pass Through Trustee will mail a notice to the Certificateholders
of such Pass Through Trust, specifying the proposed date set for such final distribution and the
proposed amount of such distribu-
</TABLE>
-7-
<PAGE> 9
<TABLE>
<S> <C>
tion. See "Description of Pass Through Certificates -- Termination of Pass Through Trusts."
Interest . . . . . . . . Interest on each series of the Pass Through Certificates will be passed through to the
Certificateholders at the rate per annum indicated on the cover of this Prospectus, which is the
interest rate borne by the Lessor Notes held by the relevant Pass Through Trustee. Interest will
be calculated on the basis of a 360-day year consisting of twelve 30-day months. See
"Description of the Pass Through Certificates -- Payments and Distributions."
Principal . . . . . . . . . Principal payments on the Lessor Notes held in each Pass Through Trust will be passed through to
the Certificateholders of each such Pass Through Trust in scheduled amounts in accordance with
the principal repayment schedule set forth in "Description of the Indentures -- Scheduled
Payments."
Prepayment of
Lessor Notes . . . . . . . The Lessor Notes issued by each Owner Trustee are subject to prepayment, in whole but not in
part, at a price equal to the outstanding principal amount thereof together with accrued and
unpaid interest thereon to the date fixed for prepayment (but without any Make-Whole Premium) at
any time upon the occurrence of an Event of Loss under the related Lease if the Company is
required to purchase the undivided ownership interest of the relevant Owner Trustee in the
Facility. The Lessor Notes issued by each Owner Trustee are also subject to mandatory
prepayment, in whole but not in part, at a price equal to the outstanding principal amount
thereof, together with interest accrued and unpaid to the date fixed for prepayment, plus if the
prepayment is made prior to January 5, 2012, a Make-Whole Premium, if any, in the following
circumstances: (i) on or after July 5, 2003 on the appropriate rent payment date in connection
with the sale of the undivided ownership interest of the relevant Owner Trustee in the Facility
if the Company exercises its early termination rights after it determines that the Facility is
obsolete or surplus or uneconomic as described below under "Description of the Leases -- Early
Termination Rights;" (ii) on January 5, 2012 if the Company exercises its early purchase option
as described below under "Description of the Leases -- Special Purchase Option;" or (iii) at any
time on the date specified in a redemption notice if the Company elects to terminate the related
Lease and purchase such Owner Trustee's undivided ownership interest in the Facility in certain
circumstances if such Owner Trustee fails to finance certain modifications to the Facility
proposed by the Company as described in "Description of the Leases -- Modifications." See
"Description of the Indentures -- Prepayment."
</TABLE>
-8-
<PAGE> 10
<TABLE>
<S> <C>
In addition, the Lessor Notes issued by each Owner Trustee may be redeemed in whole, but not in
part, at the option of such Owner Trustee (acting upon directions of the related Lessee) at any
time in connection with a refunding of such Lessor Notes, at a redemption price equal to the
outstanding principal amount of such Lessor Notes, together with accrued and unpaid interest
thereon to the date fixed for redemption, plus, if the prepayment is made prior to January 5,
2012, a Make-Whole Premium. See "Description of the Indentures -- Prepayment."
The Lessor Notes issued by each Owner Trustee may be redeemed in whole, but not in part, at the
option of such Owner Trustee at any time after an Indenture Event of Default which is also a
Lease Event of Default has occurred and is continuing at a redemption price equal to the
outstanding principal amount of such Lessor Notes, together with accrued and unpaid interest
thereon to the date fixed for redemption, plus, if the prepayment is made prior to January 5,
2012, a Make-Whole Premium, if any; provided that if the Indenture Trustee has given the Owner
Trustee notice of its intent to accelerate such Lessor Notes as a result of such Lease Event of
Default, any such prepayment will be without any Make-Whole Premium. See "Description of the
Indentures -- Prepayment."
Security for the
Lessor Notes . . . . . . The Lessor Notes will be secured by a security interest in the Facility and in the Lease related
thereto and an assignment to the Indenture Trustee of certain of the Owner Trustee's rights under
the Lease, including the right to receive rentals payable by the Company under the Lease.
The Lessor Notes are not cross-collateralized and, consequently, the Lessor Notes issued in
respect of one undivided ownership interest are not secured by the other undivided ownership
interest or the Lease related to the other undivided ownership interest. There are no cross-
defaults in the Indentures to other debt instruments of the Company, but, indirectly, the Leases
are cross-defaulted insofar as each would be treated as a Financing Lease and each Lease would be
defaulted if the Company is in default under a Financing Lease. Consequently, events resulting
in an Indenture Event of Default under one Indenture will effectively result in an Indenture
Event of Default occurring under the other Indenture. See "Description of the Indentures --
General" and "-- Indenture Events of Default."
The exercise of remedies by the Indenture Trustee upon an Indenture Event of Default is
constrained by the fact that, in certain instances, comparable remedies must be exercised under
the Lease and by the cost and practical difficulties of selling collateral such as the Facility.
</TABLE>
-9-
<PAGE> 11
<TABLE>
<S> <C>
Although the Lessor Notes are not obligations of, or guaranteed by, the Company, the amounts
payable by the Company under the Lease will be sufficient to pay in full when due all payments of
principal of, Make-Whole Premium, if any, and interest on the Lessor Notes (unless the Lessor
Notes have been purchased or prepaid by the Owner Trustee).
Additional Lessor Notes . . . Under certain circumstances, additional notes ("Supplemental Financing Notes") may be issued to
finance the cost of Certain Modifications of the Facility. No holder of a Pass Through
Certificate, as such, will have any right to, or interest in, any Supplemental Financing
Note. See "Description of the Indentures -- Supplemental Financing Notes."
Use of Proceeds . . . . . . . The proceeds from the sale of the Pass Through Certificates by each Pass Through Trust will be
used by the Pass Through Trustee to purchase the related Lessor Notes from the relevant Owner
Trustee. Each of the Owner Trustees will use the proceeds from such sale of such Lessor Notes to
finance ________% of such Owner Trustee's cost of the Facility, representing the entire debt
portion of the purchase price to be paid by the Owner Trustee in the Financing. The net proceeds
to the Company from the Financing will be approximately $_______ million. Approximately $150
million of such net proceeds will be used to repay borrowings under the Company's revolving
credit facility. The balance will be used for general corporate purposes, including the funding
of the Company's on-going and future capital expenditures. See "Use of Proceeds."
Pass Through Trustee
and Indenture Trustee . . . . The First National Bank of Chicago will act as trustee, paying agent and registrar for the Pass
Through Certificates, and will also act as the Indenture Trustee for the Lessor Notes.
Federal Income Tax
Considerations . . . . . . . . Each of the Pass Through Trusts should be classified as a grantor trust for federal income tax
purposes and each Certificate Owner should be treated as the owner of a pro-rata undivided
interest in each of the Lessor Notes or any other property held in such Pass Through Trust, and
should report on its federal income tax return its pro-rata share of income in each such Lessor
Note in accordance with such Certificate Owner's method of accounting. See "Certain Federal
Income Tax Considerations."
ERISA Considerations . . . . . No ERISA Plan or a person treated as holding the assets of an ERISA Plan, may acquire or hold the
Pass Through Certificates. The purchase or holding by any person of any Pass Through Certificate
constitutes a representation by such person to the Company, the Owner Participants, the Owner
Trustee, the Indenture Trustee and the Pass Through Trustee that such person is not an ERISA Plan
</TABLE>
-10-
<PAGE> 12
<TABLE>
<S> <C>
and that such person is not acquiring, and has not acquired such Pass Through Certificate with
assets of an ERISA Plan. See "Certain ERISA Considerations."
</TABLE>
-11-
<PAGE> 13
THE COMPANY
The Company is a worldwide company engaged in gold production,
exploration for gold and acquisition of gold properties. The Company currently
produces gold on the Carlin Trend in Nevada and through a 38% interest in a
corporate joint venture in Peru, which commenced production in August 1993.
The Company additionally has a 50% interest in a joint venture in Uzbekistan
and an 80% interest in two projects in Indonesia. The Company also owns
exploration, development and mining rights on properties in Oregon and Idaho.
In addition to exploration activities conducted in connection with the
above-referenced operations and projects, the Company continues to explore for
gold and/or is conducting joint venture discussions in various countries,
including Laos, Chile, Ecuador, Mexico and Canada. The Company's largest
stockholder, Newmont Mining Corporation ("Newmont Mining" or "NMC"), owns
approximately 89.2% of the outstanding common shares and 100% of the preferred
shares of the Company. Giving effect to the transaction described below, which
became effective January 1, 1994, between the Company and Newmont Mining, the
Company had approximately 26 million equity ounces of proven and probable
reserves at December 31, 1993 and produced approximately 1.7 million ounces of
gold in 1993.
Based on 1993 production as set forth in published reports, the
Company was the largest producer of gold from North American operations. The
Company's North American operations are located on the geographical feature
known as the Carlin Trend near Carlin, Nevada. The Carlin Trend is the largest
gold district discovered in North America this century. The Company owns or
otherwise controls mineral interests on approximately 685 square miles along
the Carlin Trend. From the Carlin Trend, the Company produced approximately
1,666,400 ounces of gold in 1993 compared with approximately 1,587,900 ounces
in 1992 and approximately 1,576,900 ounces in 1991. Gold production at the
Company's Nevada operations was approximately 754,700 ounces in the six-month
period ended June 30, 1994 and is expected to be approximately 1.6 million
ounces for the full year 1994. At the end of 1993, the Company had 17.8
million ounces of gold in proven and probable ore reserves on the Carlin Trend.
The Company's cash cost of production in Nevada (which is equal to operating
costs, excluding general and administrative expense, plus royalties and
capitalized mining costs) was $214 per ounce sold in 1993 which, according to
published industry sources, was lower than the cash costs associated with
approximately two-thirds of all gold produced in the western world in 1992.
The cash cost of production at the Company's Nevada operations was $229 per
ounce sold in the first quarter of 1994. For the full year 1994, the per ounce
cash cost of production at the Company's Nevada operations is expected to
increase 5% to 10% over that incurred in 1993.
The Company also produces gold through Minera Yanacocha S.A. ("Minera
Yanacocha"), a 38% owned corporate joint venture in Peru in which it is the
operator. Minera Yanacocha has mining rights with respect to a 63,000 acre
land position, which includes the Carachugo deposit and numerous other
deposits, located in northwest Peru. Total proven and probable reserves for
Minera Yanacocha as of December 31, 1993 were 3,780,000 ounces. Minera
Yanacocha's operations commenced in August 1993, resulting in production of
81,500 ounces from the Carachugo deposit for the five-month period ended
December 31, 1993. Total gold production at Minera Yanacocha was approximately
114,800 ounces in the six-month period ended June 30, 1994 and is expected to
be approximately 230,000 ounces for the full year 1994. Minera Yanacocha is
scheduled to commence gold production from the Maqui Maqui deposit at an
estimated annual rate of 180,000 ounces at the end of 1994. The additional
production from the Maqui Maqui deposit will increase total gold production at
Minera Yanacocha in 1995 to 350,000 to 400,000 ounces.
In Uzbekistan, one of the Central Asian republics of the former Soviet
Union, the Company has a 50/50 joint venture ("Zarafshan- Newmont") with two
state entities of the Republic of Uzbekistan to produce gold by leaching
low-grade oxide ore from existing stockpiles from the Muruntau mine. The state
entities have guaranteed 242.5 million tons of ore with an average grade of
0.036 ounces of gold per ton, containing approximately 8.7 million ounces of
gold. Net recovery is expected to be approximately 4.8 million ounces of gold
over the life of the project, 50% of which will be attributable to the Company.
The Company is managing the Zarafshan-Newmont joint venture. Production is
expected to commence in the first half of 1995 at an annual rate of
approximately 450,000 ounces of gold.
-12-
<PAGE> 14
The Company also has two advanced gold projects in Indonesia, both of
which are 80% owned by the Company. The more advanced of these projects is
Minahasa, a multi-deposit project on the island of Sulawesi. The main deposit,
Mesel, at December 31, 1993 had 1.8 million ounces of proven and probable
reserves. The Mesel deposit is scheduled to commence production in early 1996
at an annual total rate of approximately 140,000 ounces of gold. The second
Indonesian project is the Batu Hijau deposit, on the island of Sumbawa. Batu
Hijau is a porphyry gold/copper deposit that was discovered in 1990. While the
economics of the deposit have not been determined, it is one of the largest
single occurrences of gold mineralization ever discovered by the Company. A
preliminary feasibility study of the Batu Hijau deposit has been completed and
a full optimization feasibility study is anticipated to commence in early 1995
to determine the economic potential of the property.
The Company also owns 100% of Newmont Exploration Limited ("NEL"),
which, together with various other affiliates, explore worldwide for gold. NEL
was responsible for discovering the Carlin Trend in Nevada in 1961. Over the
past four years, the Company has spent more than $200 million on exploration
and mineral development. In this time period, the Company has added
approximately 13.4 million ounces in gold reserves. Management believes that
its 1994 exploration and development budget is one of the largest in the
minerals industry based on published information. The Company's 1994 budget
for exploration and reserve development is $70 million, of which approximately
$64 million will be expensed.
Effective January 1, 1994, the Company acquired all of Newmont
Mining's operations. The tax-free transaction (the "Transfer Transaction")
included the following: (a) the transfer by NMC to the Company of 8,649,899
shares of the 94,500,000 shares of common stock of the Company held by NMC; (b)
the transfer by NMC of all of its other assets to the Company; (c) the
assumption by the Company of all the liabilities (contingent or otherwise) of
NMC, but not NMC's obligations with respect to its $5.50 convertible preferred
stock (the "NMC Preferred Stock"), (except for accrued and unpaid dividends as
of December 31, 1993) and its employee stock options exercisable for NMC's
common stock; (d) the issuance by the Company to NMC of 2,875,000 shares of
$5.50 convertible preferred stock with a par value of $5.00 per share, and
having terms identical to the NMC Preferred Stock (except that upon conversion,
NMC will be entitled to receive shares of the Company's common stock instead of
NMC's common stock); and (e) the issuance by the Company to NMC of stock
options exercisable for the Company's common stock. As a result of the
Transfer Transaction, NMC's only assets are (i) the remaining shares of common
stock of the Company held by it, which currently represents 89.2% of the
Company's common stock outstanding, (ii) the 2,875,000 shares of the Company's
$5.50 convertible preferred stock issued to it and (iii) the Company's stock
options issued to it. Shares of both companies continue to trade separately on
the New York Stock Exchange and certain other international exchanges. Both
the Company and NMC have the same per-share earnings, equity in assets and
dividends.
The Company, incorporated under the laws of Delaware, maintains its
principal executive offices at 1700 Lincoln Street, Denver, Colorado 80203
(telephone: 303-863-7414).
RECENT DEVELOPMENTS
SIX MONTHS ENDED JUNE 30, 1994
On July 27, 1994, the Company announced that its net income for the
six-month period ended June 30, 1994 was $42.7 million, or $0.36 per share,
compared to $50.2 million, or $0.47 per share, for the six-month period ended
June 30, 1993. Net income for the six-month period ended June 30, 1993
includes a benefit of $2.7 million, or $0.02 per share, for the cumulative
effect of a change in accounting for income taxes. On a pro forma basis,
assuming the Transfer Transaction occurred January 1, 1993 and before
considering the impact of the cumulative effect for the change in accounting
for income taxes, earnings for the first six months of 1993 were $57.1 million,
or $0.51 per share.
-13-
<PAGE> 15
Net income for the six-month period ended June 30, 1994 includes a
$16.2 million, or $0.17 per share, income tax benefit resulting from a
favorable resolution of disputed tax assessments for prior years and a $17.6
million, or $0.18 per share, after-tax charge to adjust the Company's estimated
recoveries and liabilities for environmental cleanup costs associated with
former mining activities. Pro forma net income for the six-month period ended
June 30, 1993 includes a $19.3 million, or $0.20 per share, after-tax gain from
the sale of NMC's interest in Newcrest Mining of Australia.
Sales for the six-month period ended June 30, 1994 were $289.1
million, compared to $278.0 million for the six-month period ended June 30,
1993 (or $292.5 million on a pro forma basis giving effect to the Transfer
Transaction).
CREDIT RATINGS
On July 11, 1994 Moody's Investors Service Inc. ("Moody's") announced
that it has the Company's and NMC's debt ratings under review for possible
downgrading. Moody's stated that its reviews will take into account
management's ability to reduce the Company's operating costs, as well as the
adequacy of internally generated funds to meet the Company's future spending
needs. The review will also consider both the Company's and NMC's future
financing plans and the relative priorities of claims on cash flow by different
classes of securities that could be issued under the shelf registration
statements of the Company and NMC. Such shelf registration statements were
filed by the Company and NMC with the Commission on June 23, 1994, and, in the
case of the Company, provides for the registration of up to $150,000,000 of
debt securities to be offered from time to time and, in the case of NMC,
provides for the registration of convertible debt and equity securities having
a maximum aggregate offering price of $300,000,000 to be offered from time to
time.
-14-
<PAGE> 16
CAPITALIZATION
The following table sets forth the capitalization of the Company at
March 31, 1994 and as adjusted to give effect to the Financing and the
application by the Company of the net proceeds therefrom. See "Use of
Proceeds."
<TABLE>
<CAPTION>
March 31, 1994
---------------------------------------
(unaudited)
(in thousands, except per share)
AS ADJUSTED
ACTUAL FOR FINANCING
------ -------------
<S> <C> <C>
Short-term debt . . . . . . . . . . . . . . . . . . . . $15,739 $ 15,739
======= ========
Long-term debt
Lease Obligation . . . . . . . . . . . . . . . . . . --
------- --------
Other Long-Term Debt . . . . . . . . . . . . . . . . 219,500
--------
Total Long-Term Debt . . . . . . . . . . . . . . . 219,500
--------
Stockholders' equity:
Convertible Preferred Stock - par value $5.00,
authorized 5,000 shares; outstanding 2,875 shares . . 14,375 14,375
Common Stock - par value $0.01, authorized
250,000 shares; issued 104,875 shares . . . . . . . . 1,049 1,049
Capital in excess of par value . . . . . . . . . . . 207,578 207,578
Retained earnings . . . . . . . . . . . . . . . . . . 583,918 583,918
Treasury Stock - at cost, 8,589 shares . . . . . . . (75,666) (75,666)
-------- --------
Total stockholders' equity . . . . . . . . . . 731,254 731,254
-------- --------
Total capitalization . . . . . . . . . . . . . $950,754 $
======== ========
</TABLE>
-15-
<PAGE> 17
SELECTED CONSOLIDATED FINANCIAL DATA
The following table sets forth certain selected consolidated
historical financial data of the Company for the respective periods presented.
This data should be read in conjunction with the consolidated financial
statements of the Company contained in the Company's Annual Report on Form 10-K
for the year ended December 31, 1993 and Quarterly Report on Form 10-Q for the
quarter ended March 31, 1994, each of which are incorporated herein by
reference. See "Incorporation of Certain Documents by Reference." The
selected financial data for the three years ended December 31, 1993, 1992 and
1991 are derived from the Company's consolidated financial statements, which
statements have been audited by Arthur Andersen & Co., independent public
accountants. The data presented for the three months ended March 31, 1994 and
1993 are derived from the Company's unaudited consolidated financial statements
incorporated by reference herein which, in the opinion of management, include
all adjustments necessary for the fair presentation of the Company's financial
position and results of operations. All adjustments were of a normal recurring
nature except for a benefit to income in the first quarter of 1993 of $2.7
million for the cumulative effect of a change in accounting principle for
income taxes. The operating results for interim periods are not necessarily
indicative of results to be expected for the full year.
Also set forth below is certain pro forma income statement data for
the year ended December 31, 1993 and the quarter ended March 31, 1993 and
certain pro forma balance sheet data at December 31, 1993, in each case giving
effect to the Transfer Transaction. The pro forma income statement data for
the year ended December 31, 1993 and the three months ended March 31, 1993
reflect the Transfer Transaction as if it had occurred as of the beginning of
1993 and the pro forma balance sheet data for December 31, 1993 reflect the
Transfer Transaction as if it had occurred December 31, 1993. The pro forma
financial data are presented for illustrative purposes only, and are not
necessarily indicative of the Company's future operating results or financial
condition. The selected pro forma financial data for the year ended December
31, 1993 are derived from the Company's pro forma condensed statement of income
for the year ended December 31, 1993 and the Company's pro forma condensed
balance sheet at December 31, 1993 contained in the Company's Annual Report on
Form 10-K for the year ended December 31, 1993, which is incorporated herein by
reference. The selected pro forma financial data for the three months ended
March 31, 1993 are derived from the Company's unaudited pro forma condensed
statement of income for the year ended March 31, 1993 contained in the
Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1994,
which is incorporated herein by reference. The pro forma financial data set
forth below should be read in conjunction with the pro forma condensed
consolidated financial statements referred to above and the notes thereto. See
"Incorporation of Certain Documents by Reference."
-16-
<PAGE> 18
<TABLE>
<CAPTION>
Three Months Ended
March 31, For the Years Ended December 31,
------------------- --------------------------------
Pro
Pro Forma Forma
1994(1) 1993 1993 1993 1993 1992 1991
------ -------- ---- -------- -------- -------- -----
(unaudited) (unaudited)
FINANCIAL DATA: (In millions, except per share)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Sales . . . . . . . . . . . . . $ 149.8 $ 127.9 $ 136.2 $ 601.6 $ 634.3 $ 546.4 $ 572.7
Income before cumulative effect
of changes in accounting
principles . . . . . . . . . . $ 23.7 $ 19.4 $ 14.7 $ 113.1 $ 106.1 $ 87.4 $ 125.9
Net income . . . . . . . . . . $ 23.7 $ 22.1 N/A $ 115.8 N/A $ 81.1 $ 125.9
Earnings per common share:
Income before cumulative
effect of changes in
accounting principles. . . . $ 0.20 $ 0.18 $ 0.11 $ 1.08 $ 0.94 $ 0.83 $ 1.20
Net income . . . . . . . . . $ 0.20 $ 0.20 N/A $ 1.10 N/A $ 0.77 $ 1.20
Dividends declared per
common share(2) . . . . . . . . $ 0.12 $ --- $ 0.12 $ 0.05 $ 0.48 $ 0.05 $ 0.05
BALANCE SHEET DATA (AT PERIOD
END):
Total assets . . . . . . . . . $ 1,228.3 $ 921.2 N/A $ 1,021.9 $ 1,186.4 $ 905.3 $ 816.7
Total debt . . . . . . . . . . $ 235.2 $ --- N/A $ --- $ 207.8 $ --- $ ---
Stockholders' equity . . . . . $ 731.2 $ 832.5 N/A $ 924.0 $ 721.2 $ 810.4 $ 734.6
PRODUCTION DATA:
Production ('000 of equity
ounces)(3) . . . . . . . . . . 407.0 388.2 391.4 1,666.4 1,705.1 1,587.9 1,576.9
Realized gold price (per ounce) $ 384 $ 330 $ 348 $ 361 $ 376 $ 344 $ 363
Cash cost per equity
ounce (3),(4) . . . . . . . . . $ 225 $ 205 $ 205 $ 214 $ 213 $ 201 $ 190
- --------------------
</TABLE>
(1) Reflects the Transfer Transaction which was effective January 1, 1994.
(2) Prior to the Transfer Transaction, the Company paid an
annual dividend of $0.05 per share. Upon consummation of
the Transfer Transaction, the Company began paying
dividends on a quarterly basis and increased its annual
dividend to the level paid prior to the Transfer
Transaction by Newmont Mining on its common stock (after
adjusting for a stock split effected in connection with the
Transfer Transaction). The amount of dividend declared for
the three-month period ended March 31, 1994 reflects this
new dividend policy.
(3) Equity ounces refers to ounces produced at the Company's
Nevada operations and the proportionate share, based on the
Company's equity ownership, of ounces produced by Minera
Yanacocha.
(4) Cash cost represents the sum of costs applicable to sales
and capitalized mining costs.
-17-
<PAGE> 19
RATIO OF EARNINGS TO FIXED CHARGES
Presented herein, are the ratios of earnings to fixed charges for the
Company for the quarter ended March 31, 1994, and for the Company's parent,
Newmont Mining, for the five years ended December 31, 1993. As a result of the
Transfer Transaction, the Company's capital structure is essentially the same
as Newmont Mining's. In that the Company's financial results had been fully
consolidated into Newmont Mining's and the Company's capital structure is now
essentially that of Newmont Mining, management believes that Newmont Mining's
historical consolidated ratio of earnings to fixed charges for the five years
ended December 31, 1993 is more relevant than the Company's and thus they are
presented herein. They represent essentially what the Company's ratios would
have been had it acquired Newmont Mining's assets and assumed its liabilities
at the beginning of 1989. The last year the Company itself had significant
fixed charges was 1989, and the ratio of earnings to fixed charges for that
year was 11.6.
The ratio of earnings to fixed charges for the Company was 4.7 for the
three months ended March 31, 1994. The ratio of earnings to fixed charges for
Newmont Mining was 6.3, 6.5, 10.3, 6.6 and 2.2 for the years ended December 31,
1993, 1992, 1991, 1990 and 1989, respectively. The ratio of earnings to fixed
charges was calculated based on information from the Company's and Newmont
Mining's books and records. In computing the ratio of earnings to fixed
charges, "earnings" consists of income from continuing operations before
provision for income taxes and extraordinary items with adjustments for
interest expense (excluding capitalized interest), the amortization of
previously capitalized interest, minority interests of subsidiaries with fixed
charges and undistributed income of less than fifty percent owned affiliates.
"Fixed charges" consists of interest expense (including amortization of debt
issuance expense), capitalized interest and one-third of rental expense (which
the Company believes is a reasonable approximation of the interest factor of
such rental expense). The Company guarantees certain third party debt which
had total interest obligations of $0.2 million, $0.8 million, $3.3 million,
$4.0 million, $4.5 million and $5.0 million for the three months ended March
31, 1994 and the years ended December 31, 1993, 1992, 1991, 1990 and 1989,
respectively. The Company and Newmont Mining have not been required to pay any
of these amounts, nor does the Company expect to have to pay any amounts;
therefore, such amounts have not been included in the ratio of earnings to
fixed charges.
DESCRIPTION OF THE FACILITY
The Facility is a new refractory gold ore treatment facility located
adjacent to the Company's Gold Quarry mine approximately six miles north of
Carlin, Nevada. The Facility will be used to pretreat the refractory gold ore
produced from the Company's mines to make such ore amenable to conventional
cyanide leaching. The Facility is scheduled to be placed into service in
September 1994 and is estimated to have an average throughput capacity of 2.9
million tons of refractory ores per year.
The Facility is designed to enable the Company to oxidize and treat
refractory ores that contain both sulfides and active carbon. The Facility
includes a cone crusher, a double rotator mill, a reactor and an acid plant,
all of which are newly (or in the process of being) built, as well as portions
of the Company's existing Mill #2. Ore processed in the Facility is crushed
and then dried and ground in the double rotator mill. After drying and
grinding, the refractory ore is roasted in the reactor to oxidize carbonaceous
and sulfidic materials. The sulfidic materials are then removed in the acid
plant. The remaining ore is then processed to gold-bearing carbon using
conventional methods. The Facility incorporates state-of-the-art pollution
control technology for the control of atmospheric emissions.
In connection with the sale of the Facility to the Owner Trustees, the
Company has obtained an appraisal indicating that the fair market sales value
of the Facility is equal to the price to be paid by the Owner Trustees for the
purchase of the Facility. However, there can be no assurance that the Facility
could be sold for such amount, including in a foreclosure sale.
-18-
<PAGE> 20
DESCRIPTION OF THE TRANSACTION
GENERAL
The Pass Through Certificates offered hereby will represent fractional
undivided interests in two Pass Through Trusts to be formed pursuant to two
separate Pass Through Agreements between the Company and the Pass Through
Trustee. The property of the Pass Through Trust will consist of notes (the
"Lessor Notes") to be issued on a nonrecourse basis by the Owner Trustees of
two separate owner trusts (each an "Owner Trust") established for the benefit
of one or more institutional investors (the "Owner Participants") and held by
the Pass Through Trusts pursuant to a leveraged lease financing of the
Facility. The Facility will be purchased by the Owner Trustee on behalf of the
Owner Participants. The Owner Trustees, as tenants in common, will lease the
land on which the Facility is located (the "Site Interest") and accept a grant
from the Company of an easement relating to the adjacent Company premises
(together with the Site Interest, the "Facility Site") pursuant to a ground
lease and easement (the "Ground Lease and Easement"). Pursuant to the Leases,
the Owner Trustees will lease the undivided interests in the Facility, and
sublease the Site Interest, to the Company. The Lessor Notes issued by each
Owner Trustee will be secured by a security interest in the related undivided
ownership interest and in the Lease relating thereto (other than certain
excepted rights reserved to each Owner Trustee), including the right to receive
rentals payable by the Company under such Lease. See "Description of the
Leases."
The Lessor Notes will be issued under two separate Trust Indenture and
Security Agreements (each an "Indenture"), each entered into by The First
National Bank of Chicago, as trustee thereunder (the "Indenture Trustee"), and
the related Owner Trustee. The Lessor Notes will be acquired from the Owner
Trustees by the Pass Through Trustee with the proceeds from the sale of the
Pass Through Certificates. The Lessor Notes will be nonrecourse obligations of
the Owner Participant, the Owner Trustees or the Owner Trusts payable solely
from basic rent and other amounts paid under the Leases and amounts realized
from the exercise of the Indenture Trustees' remedies under the Indentures.
The rents and other amounts payable by the Company under the Leases will be
sufficient to pay in full when due all payments of principal, the Make-Whole
Premium, if any, and interest on the Lessor Notes. See "Description of the
Indentures."
FORMATION OF THE PASS THROUGH TRUST
The Pass Through Trusts will be formed pursuant to the Pass Through
Agreements between the Company and the Pass Through Trustee. Each Pass Through
Trustee, on behalf of the related Pass Through Trust, will purchase Lessor
Notes under both Indentures which have the same maturity and interest as the
Pass Through Certificates issued by such Pass Through Trust. The final
distribution date of the Pass Through Certificates will be the maturity date of
the Lessor Notes. Each Pass Through Trustee will distribute the amount of
payments of principal, Make-Whole Premium, if any, and interest received by it
as holder of the Lessor Notes to the Certificateholders. See "Description of
the Pass Through Certificates -- General" and "Description of the Indentures --
General."
USE OF PROCEEDS
The Pass Through Certificates are being issued in order to facilitate
the financing by the Owner Trustees of their purchase of the Facility. The
proceeds from the sale of the Pass Through Certificates by each Pass Through
Trust will be used by the Pass Through Trustee to purchase the related Lessor
Notes from the relevant Owner Trustee. Each of the Owner Trustees will use the
proceeds from such sale of such Lessor Notes to finance % of such Owner
Trustee's cost of the Facility, representing the entire debt portion of the
purchase price to be paid by the Owner Trustee in the Financing. See
"Description of the Transaction." The net proceeds to the Company from the
Financing will be approximately $ million. Approximately $150 million of
the net proceeds will be used to repay borrowings by the Company under its
revolving credit facility, which borrowings bear interest at an average rate of
4.7% and has a maturity of less than one year. Such borrowings were made to
finance
-19-
<PAGE> 21
a portion of the construction costs for the Facility and to finance other
capital expenditures. The balance of the net proceeds will be used for general
corporate purposes, including the funding of the Company's on-going and future
capital expenditures.
DIAGRAM OF PAYMENTS
The diagram on the following page illustrates certain aspects of the
payment flows among the Company, the Owner Trustees, the Indenture Trustees,
the Pass Through Trustees and the Certificateholders.
[INSERT DIAGRAM OF PAYMENTS]
-20-
<PAGE> 22
DESCRIPTION OF THE PASS THROUGH CERTIFICATES
In connection with the offering of the Pass Through Certificates, two
separate Pass Through Trusts will be formed, and two corresponding Series of
Pass Through Certificates will be issued, pursuant to two Pass Through
Agreements to be entered into between the Company and the Pass Through
Trustees. The following summary relates to each Pass Through Agreement, the
Pass Through Trusts to be formed thereby and the Pass Through Certificates to
be issued by each Pass Through Trust, except as otherwise described herein.
This Prospectus contains a glossary of the material terms used with respect to
the specific series of Pass Through Certificates being offered hereby.
Citations which appear below in parentheses are to the relevant sections of the
Pass Through Agreement unless otherwise indicated.
The discussion that follows is a summary and does not purport to be
complete. The summary includes descriptions of the material terms of the Pass
Through Agreement, the form of which has been filed as an exhibit to the
Registration Statement of which this Prospectus forms a part. This summary
makes use of terms defined in and is qualified in its entirety by reference to
the Pass Through Agreements.
GENERAL
The Pass Through Certificates offered hereby will be issued by the
1994-A1 Trust and the 1994-A2 Trust to be formed pursuant to the related Pass
Through Agreement, to be entered into between the Company and the Pass Through
Trustee on the date of issuance of the related Pass Through Certificates. Each
Pass Through Agreement will contain substantially the same terms and
conditions, except that the interest rate, the scheduled repayments of
principal, the maturity date applicable to the Lessor Notes held in each Pass
Through Trust, the aggregate principal amount of such Lessor Notes and the
final distribution date applicable to each Pass Through Trust will differ.
The Pass Through Certificates will be issued in fully registered,
certificated form only. Each Pass Through Certificate will represent a
fractional undivided interest in the separate Pass Through Trust formed by the
Pass Through Agreement pursuant to which such Pass Through Certificate is
issued. The property of each Pass Through Trust will include the Lessor Notes
held in such Pass Through Trust, all monies at any time paid thereon, all
monies due and to become due thereunder and funds from time to time deposited
with the Pass Through Trustee in accounts relating to such Pass Through Trust.
Each Pass Through Certificate will represent a pro rata share of the
outstanding principal amount of the Lessor Notes and other property held in the
related Pass Through Trust and will be issued in minimum denominations of
$1,000 or any integral multiple of $1,000. (Pass Through Agreement, Article
II)
Pass Through Certificates will be registered in the name of Cede & Co.
("Cede") as the nominee of The Depository Trust Company ("DTC") and no person
acquiring an interest in Pass Through Certificates (a "Certificate Owner") will
be entitled to receive a certificated Pass Through Certificate representing
such person's interest in the related Pass Through Trust unless such
certificates are issued as described below. Unless certificated Pass Through
Certificates are issued, all references to actions by Certificateholders shall
refer to actions taken by DTC upon instructions from DTC Participants (as
defined below), and all references herein to distributions, notices, reports
and settlements to Certificateholders shall refer, as the case may be, to
distributions, notices, reports and statements to DTC or Cede, as the
registered holder of the Pass Through Certificates, or to DTC Participants for
distribution to Certificate Owners in accordance with DTC procedures. See
"Book-Entry Procedures" below.
The Pass Through Certificates represent interests in the related Pass
Through Trust only and all payments and distributions shall be made only from
the Trust Property of such Pass Through Trust. The Pass Through Certificates
do not represent an interest in or obligation of the Company, the Pass Through
Trustee, any related Owner Participant, the Owner Trustee in its individual
capacity or any affiliate of any of the foregoing. Each Certificateholder by
its acceptance of a Pass Through Certificate agrees to
-21-
<PAGE> 23
look solely to the income and proceeds from the property held in the related
Pass Through Trust as provided in the Pass Through Agreement. (Pass Through
Agreement, Section 3.06)
Neither the Pass Through Agreements nor the Indentures will contain
any debt covenants or provisions that would afford Certificateholders
protection in the event of a highly leveraged transaction involving the
Company.
BOOK-ENTRY PROCEDURES
The statements set forth in this section include summaries of certain
rules and operating procedures of DTC which affect, among other matters,
transfers of interests in the Pass Through Certificates. The information in
this section concerning DTC has been obtained from DTC.
General. Upon issuance, each Series of Pass Through Certificates will
be represented by one or more fully registered global certificates. Each
global certificate will be deposited with, or on behalf of, DTC, and registered
in the name of Cede, its nominee. No Certificate Owner will be entitled to
receive a certificated Pass Through Certificate, except as set forth below.
(Pass Through Agreement, Section 2.12)
DTC has advised the Company that DTC is a limited-purpose trust
company organized under the laws of the State of New York, a member of the
Federal Reserve System, a "clearing corporation" within the meaning of the New
York Uniform Commercial Code and a "clearing agency" registered pursuant to
Section 17A of the Exchange Act. DTC was created to hold securities for its
participants ("DTC Participants") and to facilitate the clearance and
settlement of securities transactions among DTC Participants through electronic
book-entries, thereby eliminating the need for physical movement of
certificates. DTC Participants include securities brokers and dealers, banks,
trust companies, clearing corporations and certain other organizations. Access
to DTC's book-entry system is also available to others, such as banks, brokers,
dealers and trust companies that clear through or maintain a custodial
relationship with a DTC Participant, either directly or indirectly.
Certificate Owners that are not DTC Participants but desire to
purchase, sell or otherwise transfer ownership of, or other interests in, Pass
Through Certificates may do so only through DTC Participants. In addition,
Certificate Owners will receive all distributions of principal and interest
from the Pass Through Trustee through the DTC Participants. Under the rules,
regulations and procedures creating and affecting DTC and its operation, DTC is
required to make book-entry transfers of Pass Through Certificates among DTC
Participants on whose behalf it acts and to receive and transmit distributions
of principal of, and interest on, the Pass Through Certificates. Under the
book-entry system, Certificate Owners may experience some delay in their
receipt of payments, since such payments will be forwarded by the Pass Through
Trustee to Cede, as nominee for DTC, and DTC in turn will forward the payments
to the appropriate DTC Participants. Distributions by DTC Participants to
Certificate Owners will be the sole responsibility of such DTC Participants and
will be made in accordance with customary industry practices. Accordingly,
although Certificate Owners will not have possession of the Pass Through
Certificates, the rules of DTC provide a mechanism by which DTC Participants
will receive payments and will be able to transfer their interests. Although
the DTC Participants are expected to convey the rights represented by their
interests in any global security to the related Certificate Owners, because DTC
can only act on behalf of DTC Participants, the ability of Certificate Owners
to pledge Pass Through Certificates to persons or entities that are not DTC
Participants, or to otherwise act with respect to such Pass Through
Certificates, may be limited due to the lack of physical certificates for such
Pass Through Certificates.
None of the Company, the Pass Through Trustee or any other agent of
the Company or the Pass Through Trustee will have any responsibility or
liability for any aspect of the records relating to, or payments made on
account of, beneficial ownership interests in the Pass Through Certificates or
for supervising or reviewing any records relating to such beneficial ownership
interests. Since the only "Certificateholder" will be Cede, as nominee of DTC,
Certificate Owners will not be recognized by the
-22-
<PAGE> 24
Pass Through Trustee as Certificateholders, as such term is used in the Pass
Through Agreement, and Certificate Owners will be permitted to exercise the
rights of Certificateholders only indirectly through DTC and DTC Participants.
The Pass Through Certificates will be issued in fully registered,
certificated form to Certificate Owners, or their nominees, rather than to DTC
or its nominee, only if DTC advises the Pass Through Trustee in writing that it
is no longer willing or able or qualified to discharge properly its
responsibilities as depository with respect to the Pass Through Certificates
and the Company is unable to locate a qualified successor or if the Company, at
its option, elects to terminate the book-entry system through DTC. In such
event, the Pass Through Trustee will notify all Certificate Owners through DTC
Participants of the availability of such certificated Pass Through
Certificates. Upon surrender by DTC of the registered global certificate or
certificates representing the series of Pass Through Certificates and receipt
of instructions for reregistration, the Pass Through Trustee will reissue the
Pass Through Certificates in certificated form to Certificate Owners or their
nominees. Such certificated Pass Through Certificates will be freely
transferable and exchangeable at the office of the Pass Through Trustee upon
compliance with the requirements set forth in the related Pass Through
Agreement. No service charge will be imposed for any registration of transfer
or exchange, but payment of a sum sufficient to cover any tax or other
governmental charge may be required. (Pass Through Agreement, Sections 2.08
and 2.12)
Same-Day Settlement and Payment. All payments made by the Company
under any Lease will be in immediately available funds. Payments by the
Indenture Trustee with respect to Lessor Notes will be passed through to DTC in
immediately available funds.
Secondary trading in long-term notes and debentures of corporate
issuers is generally settled in clearinghouse or next-day funds. In contrast,
secondary trading in pass through certificates is generally settled in
immediately available or same-day funds. Any Pass Through Certificates
registered in the name of Cede, as nominee for DTC, will trade in DTC's
Same-Day Funds Settlement System until maturity, and secondary market trading
activity in the Pass Through Certificates will therefore be required by DTC to
settle in immediately available funds. No assurance can be given as to the
effect, if any, of settlement in same-day funds on trading activity in the Pass
Through Certificates.
PAYMENTS AND DISTRIBUTIONS
The Company will make scheduled rental payments for the Facility under
the related Leases. These scheduled rental payments will be assigned under the
applicable Indenture by the Owner Trustee to the Indenture Trustee to provide
the funds necessary to make the corresponding payments of principal and
interest due from the Owner Trustee on the Lessor Notes issued under such
Indenture. After the Indenture Trustee has made such principal and interest
payments to the Pass Through Trustee for each of the Pass Through Trusts on the
Lessor Notes held in such Pass Through Trust, the Indenture Trustee will,
except under certain circumstances, pay the remaining balance, if any, to the
Owner Trustee for the benefit of the related Owner Participant. The Pass
Through Trustee for each such Pass Through Trust will distribute to the
Certificateholders of such Pass Through Trust payments received on the Lessor
Notes held in such Pass Through Trust as described below.
Payments of principal of, and interest on the unpaid amount of, the
Lessor Notes held in each Pass Through Trust will be scheduled to be received
by the Pass Through Trustee on the dates specified below (such scheduled
payments of principal of, and interest on, the Lessor Notes are referred to
herein as "Scheduled Payments," and the dates specified for distributions of
Scheduled Payments to the Pass Through Trustee are referred to herein as
"Regular Distribution Dates"). Interest on the Pass Through Certificates will
be passed through to the Certificateholders at the rate per annum indicated on
the cover of this Prospectus, which is the interest rate borne by the Lessor
Notes. Interest will be calculated on the basis of a 360-day year consisting
of twelve 30-day months. For each Pass Through Trust, the Pass Through Trustee
will distribute on each Regular Distribution Date to the related
Certificateholders any Scheduled Payment received by the Pass Through Trustee
on such Regular Distribution Date. If a
-23-
<PAGE> 25
Scheduled Payment is not received by the Pass Through Trustee on or before a
Regular Distribution Date but is received within five Business Days thereafter,
it will be distributed on the date received to the Certificateholders. Each
such distribution of a Scheduled Payment will be made by the Pass Through
Trustee to the Certificateholders of record of such Pass Through Trust on the
fifteenth day prior to such Regular Distribution Date, subject to certain
exceptions. Each such Certificateholder will be entitled to receive a pro rata
share of any such distribution. (Pass Through Agreement, Sections 5.01 and
5.02) If a Scheduled Payment is received more than five Business Days after the
applicable Regular Distribution Date, it will be treated as a Special Payment
and will be distributed as described below.
The Regular Distribution Dates for each Pass Through Trust are January
5 and July 5. Payments of interest on the Lessor Notes held in each Pass
Through Trust are scheduled to be received by the Pass Through Trustee on each
January 5 and July 5, commencing on July 5, 1995, and are to be distributed to
the related Certificateholders on the corresponding Regular Distribution Dates.
For each Pass Through Trust, the Lessor Notes held in such Pass Through Trust
will accrue interest on the unpaid principal amount thereof at the rate per
annum set forth on the cover of this Prospectus applicable to the related Pass
Through Certificates, which is calculated on the basis of a 360-day year
consisting of twelve 30-day months.
Payments of principal on the Lessor Notes held in each Pass Through
Trust are scheduled to be received by the Pass Through Trustee and are to be
distributed to the related Certificateholders in accordance with the principal
repayment schedule set forth in "Description of the Indentures -- Scheduled
Payments."
After any prepayment of principal, any redemption or any default in
respect of some or all of the Lessor Notes held in any Pass Through Trust, any
Certificateholder of such Pass Through Trust should refer to the Pool Balance
and the Pool Factor (as such terms are defined below) for such Pass Through
Trust reported periodically by the Pass Through Trustee in order to calculate
such Certificateholder's pro rata share of such Pass Through Trust. See "Pool
Factors" and "Statements to Certificateholders" below.
For each Pass Through Trust, any payments of principal, Make-Whole
Premium, if any, or interest, other than Scheduled Payments, received by the
Pass Through Trustee on any of the Lessor Notes held in such Pass Through
Trust, including payments received (i) for the prepayment of such Lessor Notes
in connection with certain events specified in this Prospectus, (ii) upon the
prepayment by the related Owner Trustee of such Lessor Notes following a
default in respect of such Lessor Notes, and (iii) on account of the sale of
such Lessor Notes by the Pass Through Trustee (such payments are referred to
herein as "Special Payments"), will be distributed on the dates determined as
set forth below (each, a "Special Distribution Date" and, together with the
Regular Distribution Dates, the "Distribution Dates"). Prior to any Special
Payment for any Pass Through Trust, the Pass Through Trustee will notify the
Certificateholders of record of such Pass Through Trust of such Special Payment
and the anticipated Special Distribution Date therefor in accordance with the
related Pass Through Agreement. Each distribution of a Special Payment, other
than the final distribution, for any Pass Through Trust will be made by the
Pass Through Trustee to the Certificateholders of record of such Pass Through
Trust on the fifteenth day prior to such Special Distribution Date. Each such
Certificateholder will be entitled to receive a pro rata share of any such
distribution. (Pass Through Agreement, Section 5.02) See "-- Events of Default
and Certain Rights Upon an Event of Default" below.
For each Pass Through Trust, the Special Distribution Dates will be
the day of any month, except that the Special Distribution Date
will correspond to the date of the receipt of proceeds by the Pass Through
Trustee in the case of a refinancing of the related Lessor Notes.
Each Pass Through Agreement requires that the Pass Through Trustee
establish and maintain, for the related Pass Through Trust and for the benefit
of the related Certificateholders, one or more non-interest bearing accounts
(the "Certificate Account") for the deposit of Scheduled Payments on the Lessor
Notes held in such Pass Through Trust and one or more accounts (the "Special
Payments
-24-
<PAGE> 26
Account") which will, except in connection with Pass Through Permitted
Investments as discussed below, be non-interest bearing for the deposit of
Special Payments on such Lessor Notes. The Pass Through Trustee is required to
deposit any Scheduled Payments relating to a Pass Through Trust received by it
in the related Certificate Account and to deposit any Special Payments so
received by it in the related Special Payments Account pending distribution
thereof. (Pass Through Agreement, Section 5.01) Special Payments that are not
promptly distributed by the Pass Through Trustee will, to the extent
practicable, be invested by the Pass Through Trustee in Pass Through Permitted
Investments pending the distribution of such funds on a Special Distribution
Date, and the income and earnings on such investment will be distributed with
such Special Payment. "Pass Through Permitted Investments" are non-callable
direct obligations of the United States of America maturing on or prior to the
day required for the distribution of any such funds on a Special Distribution
Date. (Pass Through Agreement, Article I and Section 5.04)
Distributions by the Pass Through Trustee from the Certificate Account
or the Special Payments Account of any Pass Through Trust on any Distribution
Date will be paid to each Certificateholder of record of such Pass Through
Trust on the applicable record date at its address appearing on the register
maintained for such Pass Through Trust. (Pass Through Agreement, Section 5.02)
The final distribution for each Pass Through Trust, however, will be made only
upon presentation and surrender of the Pass Through Certificates for such Pass
Through Trust at the office or agency of the Pass Through Trustee specified in
the notice given by the Pass Through Trustee of such final distribution. The
Pass Through Trustee will mail such notice of the final distribution to the
Certificateholders of such Pass Through Trust, specifying the date set for such
final distribution and the amount of such distribution. (Pass Through
Agreement, Section 12.01) See "Termination of Pass Through Trusts" below.
If any Distribution Date is not a Business Day, distributions
scheduled to be made on such Distribution Date may be made on the next
succeeding Business Day without additional interest. (Pass Through Agreement,
Section 13.15)
POOL FACTORS
Except as provided below, the Pool Factor (as defined below) for any
Pass Through Trust will decline in proportion to the scheduled repayments of
principal on the Lessor Notes held in such Pass Through Trust as described
below in "Description of the Indentures -- Scheduled Payments." Where any
Lessor Note held in a Pass Through Trust has been prepaid, a scheduled
repayment of principal thereon has not been made or certain actions have been
taken following a default thereon, as discussed below in "Events of Default and
Certain Rights Upon an Event of Default" below, the Pool Factor and the Pool
Balance (as defined below) of such Pass Through Trust will be recomputed after
giving effect thereto and notice thereof will be mailed to the
Certificateholders of such Pass Through Trust. Each Pass Through Trust will
have a separate Pool Factor.
The "Pool Balance" for each Pass Through Trust indicates, as of any
date, the aggregate unpaid principal amount of the Lessor Notes held in such
Pass Through Trust on such date plus any amounts in respect of the principal of
such Lessor Notes held by the Pass Through Trustee and not yet distributed.
The Pool Balance for each Pass Through Trust as of any Distribution Date will
be computed after giving effect to the payment of principal, if any, on the
Lessor Notes held in such Pass Through Trust and the distribution thereof being
made on that date. (Pass Through Agreement, Article I)
The "Pool Factor" for each Pass Through Trust as of any Distribution
Date is the quotient (rounded to the seventh decimal place) computed by
dividing (i) the Pool Balance, by (ii) the aggregate original principal amount
of the Lessor Notes held in such Pass Through Trust. The Pool Factor for each
Pass Through Trust as of any Distribution Date will be computed after giving
effect to the payment of principal, if any, on the Lessor Notes held in such
Pass Through Trust and the distribution thereof being made on that date. The
Pool Factor for each Pass Through Trust will initially be 1.0000000;
thereafter, the Pool Factor for each Pass Through Trust will decline as
described herein to reflect reductions in the Pool Balance of such Pass Through
Trust. For any Pass Through Trust, the amount of any Certificateholder's pro
rata share of the Pool Balance of such Pass Through Trust can be determined by
-25-
<PAGE> 27
multiplying the original denomination of such Certificateholder's Pass Through
Certificate by the Pool Factor for such Pass Through Trust as of the applicable
Distribution Date. (Pass Through Agreement, Article I)
As of the date of issuance of the Pass Through Certificates by the
Pass Through Trustee, and assuming that no prepayment or default in respect of
any Lessor Notes shall occur, the aggregate scheduled repayments of principal
on such Lessor Notes for each Pass Through Trust, and the resulting Pool
Factors for such Pass Through Trusts after taking into account each such
repayment, are set forth below:
<TABLE>
<CAPTION>
1994-A1 Trust 1994-A2 Trust
---------------------------------- ----------------------------------
Scheduled Scheduled
Regular Principal Principal
Distribution Payments Payments
Date on Lessor Notes Pool Factor on Lessor Notes Pool Factor
---- --------------- ----------- --------------- -----------
<S> <C> <C> <C>
$ 1.0000000 $ 1.0000000
</TABLE>
STATEMENTS TO CERTIFICATEHOLDERS
On each Distribution Date, the Pass Through Trustee will include with
each distribution of a Scheduled Payment or Special Payment to
Certificateholders of record of the related Pass Through Trust a statement,
giving effect to such distribution being made on such Distribution Date,
setting forth the following information (per $1,000 in aggregate amount of Pass
Through Certificates for such Pass Through Trust, as to (i) and (ii) below):
(i) the amount of such distribution allocable to principal
and allocable to the Make-Whole Premium, if any;
(ii) the amount of such distribution allocable to interest; and
(iii) the Pool Balance and the Pool Factor for such Pass
Through Trust.
In addition, after the end of each calendar year, the Pass Through
Trustee will prepare for each Certificateholder of each Pass Through Trust at
any time during the preceding calendar year a report containing the sum of the
amounts determined pursuant to clauses (i) and (ii) above with respect to each
such Pass Through Trust for such calendar year or, in the event such person was
a Certificateholder during a portion of such calendar year, for the applicable
portion of such calendar year. (Pass Through Agreement, Section 5.03)
VOTING OF THE LESSOR NOTES
The Pass Through Trustee, as holder of the Lessor Notes held in each
Pass Through Trust, has the right to vote and give consents and waivers in
respect of such Lessor Notes under the related Indentures. The Pass Through
Agreement sets forth the circumstances in which the Pass Through Trustee shall
direct any action or cast any vote as the holder of the Lessor Notes held in
the applicable Pass Through Trust at its own discretion and the circumstances
in which the Pass Through Trustee shall seek instructions from the
Certificateholders of such Pass Through Trust. Prior to an Event of Default
(as defined below) with respect to any Pass Through Trust, the principal amount
of the Lessor Notes held in such Pass Through Trust directing any action or
being voted for or against any proposal will be in proportion to the principal
amount of Pass Through Certificates held by the Certificateholders of such Pass
Through Trust taking the corresponding position. (Pass Through Agreement,
Section 11.08)
-26-
<PAGE> 28
EVENTS OF DEFAULT AND
CERTAIN RIGHTS UPON AN EVENT OF DEFAULT
Each of the Pass Through Agreements defines an event of default for
the related Pass Through Trust (an "Event of Default") as the occurrence and
continuance of an event of default under the related Indenture (an "Indenture
Event of Default"). The Indenture Events of Default under each Indenture are
described under "Description of the Indentures -- Indenture Events of Default"
and will include events of default under the related Lease ("Lease Events of
Default"). Since the Lessor Notes outstanding under an Indenture may be held
in more than one Pass Through Trust, a continuing Indenture Event of Default
under such Indenture would result in an Event of Default with respect to each
such Pass Through Trust. All of the Lessor Notes issued under the same
Indenture, however, will relate to a specific Owner Trust and there are no
cross-defaults to other debt instruments of the Company in the Indenture but,
indirectly, the Leases are cross-defaulted insofar as each would be treated as
a Financing Lease and each Lease would be defaulted if the Company is in
default under a Financing Lease. Consequently, events resulting in an
Indenture Event of Default under any particular Indenture will not necessarily
result in an Indenture Event of Default occurring under any other Indenture.
If an Indenture Event of Default occurs in fewer than all of the Indentures
related to a Pass Through Trust, the Lessor Notes issued pursuant to the
related Indentures with respect to which an Indenture Event of Default has not
occurred will continue to be held in such Pass Through Trust and payments of
principal of, Make-Whole Premium, if any, and interest on such Lessor Notes
will continue to be distributed to the Certificateholders of such Pass Through
Trust as originally scheduled.
The Lessor Notes in any Pass Through Trust, and therefore the related
Pass Through Certificates, will not have the benefit of any debt covenants or
provisions in the Indentures relating to such Lessor Notes or Pass Through
Certificates that would afford the holders thereof protection in the event of a
highly leveraged transaction involving the Company.
Under each Indenture, the Owner Trustee will have the right under
certain circumstances to cure an Indenture Event of Default that results from
the occurrence of a Lease Event of Default under the related Lease. If the
Owner Trustee chooses to exercise such cure right, the Indenture Event of
Default and consequently the Event of Default under any Pass Through Trust
holding the related Lessor Notes will be deemed to be cured. See "Description
of the Indentures -- Indenture Events of Default" for a more detailed
discussion of certain provisions described in this paragraph.
Each Pass Through Agreement provides that if an Indenture Event of
Default under an Indenture relating to Lessor Notes held in a Pass Through
Trust shall have occurred and be continuing, the Pass Through Trustee (i) may
vote all of the Lessor Notes issued under such Indenture that are held in such
Pass Through Trust, and (ii) upon the direction of the Certificateholders
evidencing fractional undivided interests aggregating not less than a majority
in interest of such Pass Through Trust shall vote a corresponding majority of
such Lessor Notes, in each case in favor of directing the related Indenture
Trustee to declare the unpaid principal amount of all Lessor Notes issued under
such Indenture and any accrued and unpaid interest thereon to be due and
payable. Each Pass Through Agreement also provides that if an Indenture Event
of Default under an Indenture relating to Lessor Notes held in the related Pass
Through Trust shall have occurred and be continuing, the Pass Through Trustee
may, and upon the direction of the Certificateholders evidencing fractional
undivided interests aggregating not less than a majority in interest of such
Pass Through Trust shall, vote all of the Lessor Notes issued under such
Indenture that are held in such Pass Through Trust in favor of directing the
related Indenture Trustee as to the time, method and place of conducting any
proceeding for any remedy available to such Indenture Trustee or of exercising
any trust or power conferred on such Indenture Trustee under such Indenture.
(Pass Through Agreement, Sections 7.01 and 7.09)
The ability of the Certificateholders of any one Pass Through Trust to
cause the Indenture Trustee for any Lessor Notes held in such Pass Through
Trust to accelerate the payment on such Lessor Notes under the related
Indenture or to direct the exercise of remedies by such Indenture Trustee under
the related Indenture will depend, in part, upon the proportion between the
aggregate principal amount
-27-
<PAGE> 29
of the Lessor Notes outstanding under such Indenture and held in such Pass
Through Trust and the aggregate principal amount of all Lessor Notes
outstanding under such Indenture. Each Pass Through Trust will hold Lessor
Notes outstanding under such Indenture. Each Pass Through Trust will hold
Lessor Notes with different maturities and interest rates from those of the
Lessor Notes held in any other Pass Through Trust and, therefore, the
Certificateholders of a Pass Through Trust may have divergent or conflicting
interests from those of the Certificateholders of the other Pass Through Trusts
holding Lessor Notes relating to the same Indenture. In addition, so long as
the same institution or an affiliate of such institution acts as Pass Through
Trustee of each Pass Through Trust, in the absence of instructions from the
Certificateholders of any such Pass Through Trust, the Pass Through Trustee for
such Pass Through Trust could for the same reason be faced with a potential
conflict of interest upon an Indenture Event of Default. In such event, the
initial Pass Through Trustee has indicated that it would resign as Pass Through
Trustee of one or all of such Pass Through Trusts, and a successor pass through
trustee would be appointed in accordance with the terms of the Pass Through
Agreement. See "The Pass Through Trustee" below for a discussion of
resignation procedures.
As an additional remedy, if an Indenture Event of Default under an
Indenture has occurred and is continuing, each Pass Through Agreement provides
that the Pass Through Trustee of a Pass Through Trust holding Lessor Notes
issued under such Indenture may, and upon the direction of the
Certificateholders evidencing fractional undivided interests aggregating not
less than a majority in interest of such Pass Through Trust will, sell all or
part of such Lessor Notes for cash to any person at a price or prices that it
may reasonably deem advisable. Any proceeds received by the Pass Through
Trustee upon any such sale will be deposited in the Special Payments Account
for such Pass Through Trust and will be distributed to the Certificateholders
of such Pass Through Trust on a Special Distribution Date. (Pass Through
Agreement, Sections 7.01 and 7.02) The market for Lessor Notes in default may
be very limited and there can be no assurance that they could be sold for a
reasonable price. Furthermore, so long as the same institution or an affiliate
of such institution acts as Pass Through Trustee of each Pass Through Trust, it
may be faced with a conflict in deciding from which Pass Through Trust to sell
Lessor Notes to available buyers. If the Pass Through Trustee sells any such
Lessor Notes with respect to which an Indenture Event of Default exists for
less than the outstanding principal amount thereof, the Certificateholders of
such Pass Through Trust will receive a smaller amount of principal
distributions than anticipated and will not have any claim for the shortfall
against the Pass Through Trustee, the Company, the Owner Trustee or any related
Owner Participants. Furthermore, neither the Pass Through Trustee nor the
Certificateholders of such Pass Through Trust could take any action with
respect to any remaining Lessor Notes held in such Pass Through Trust so long
as no Indenture Event of Default existed with respect thereto.
For any Pass Through Trust, any amount distributed to the Pass Through
Trustee by the Indenture Trustee under any Indenture on account of the Lessor
Notes held in such Pass Through Trust following an Indenture Event of Default
under such Indenture will be deposited in the Special Payments Account for such
Pass Through Trust and will be distributed to the Certificateholders of such
Pass Through Trust on a Special Distribution Date. In addition, if, following
an Indenture Event of Default, the related Owner Trustee exercises its option
to redeem the outstanding Lessor Notes issued under such Indenture, the price
paid by such Owner Trustee to the Pass Through Trustee for such Lessor Notes
held in such Pass Through Trust will be deposited in the related Special
Payments Account and will be distributed to the Certificateholders of such Pass
Through Trust on a Special Distribution Date. (Pass Through Agreement,
Sections 5.01 and 5.02)
Any funds representing payments received with respect to any Lessor
Notes held in a Pass Through Trust in default, or the proceeds from the sale by
the Pass Through Trustee of any such Lessor Notes, held by the Pass Through
Trustee in the Special Payments Account for such Pass Through Trust will, to
the extent practicable, be invested by the Pass Through Trustee in Pass Through
Permitted Investments pending the distribution of such funds on a Special
Distribution Date. (Pass Through Agreement, Article I and Section 5.04)
-28-
<PAGE> 30
Each Pass Through Agreement provides that the Pass Through Trustee
will, within 90 days after the occurrence of a default (as defined below) under
any Pass Through Trust, notify the Certificateholders of such Pass Through
Trust by mail of all uncured or unwaived defaults with respect to such Pass
Through Trust known to it. The Pass Through Trustee will be protected in
withholding such notice if it in good faith determines that the withholding of
such notice is in the interests of such Certificateholders, except in the case
of default in the payment of principal of, Make-Whole Premium, if any, or
interest on any of the Lessor Notes held in such Pass Through Trust. The term
"default," for the purpose of the provision described in this paragraph only,
means the occurrence of any Event of Default with respect to a Pass Through
Trust as described above, except that in determining whether any such Event of
Default has occurred any grace period or notice in connection therewith shall
be disregarded. (Pass Through Agreement, Section 7.11)
Each Pass Through Agreement provides that for the related Pass Through
Trust, subject to the duty of the Pass Through Trustee during a default to act
with the required standard of care, the Pass Through Trustee is entitled to be
indemnified by the Certificateholders of such Pass Through Trust before
proceeding to exercise any right or power under such Pass Through Trust at the
request of such Certificateholders. (Pass Through Agreement, Section 8.03)
In certain cases, the Certificateholders of a Pass Through Trust
evidencing fractional undivided interests aggregating not less than a majority
in interest of such Pass Through Trust may on behalf of all the
Certificateholders of such Pass Through Trust waive any past default or Event
of Default with respect to such Pass Through Trust and thereby annul any
direction given by such Certificateholders to the Pass Through Trustee or the
related Indenture Trustee with respect thereto, except (i) a default in payment
of the principal of, Make-Whole Premium, if any, or interest on any of the
Lessor Notes held in such Pass Through Trust and (ii) a default in respect of
any covenant or provision of the related Pass Through Agreement that cannot be
modified or amended without the consent of each Certificateholder of such Pass
Through Trust affected thereby. Any such waiver, however, will be effective to
waive any such past default or Event of Default if, but only if, the
correlative Indenture Event of Default has been waived under the related
Indenture by the requisite holders of the Lessor Notes outstanding thereunder.
(Pass Through Agreement, Section 7.10) Each Indenture will provide that, with
certain exceptions, the holders of two-thirds of the aggregate unpaid principal
amount of the Lessor Notes issued thereunder may on behalf of all such holders
waive any past default or Indenture Event of Default thereunder. (Indenture,
Section 4.07) If, as described above, the Certificateholders of a Pass Through
Trust elect to waive a past default or Event of Default with respect to such
Pass Through Trust, the principal amount of the Lessor Notes issued under the
related Indenture and held in such Pass Through Trust will be counted in favor
of the waiver of the corresponding past default or Indenture Event of Default
under the related Indenture when the Indenture Trustee determines whether such
past default or Indenture Event of Default has been waived by the requisite
majority in aggregate unpaid principal amount of Lessor Notes under such
Indenture. If, for example, the Lessor Notes issued under an Indenture held in
a Pass Through Trust constitute only 45% in aggregate unpaid principal amount
of the Lessor Notes issued and unpaid under such Indenture, even if all the
Certificateholders of such Pass Through Trust were to instruct the Pass Through
Trustee not to waive a past default or Event of Default with respect to such
Pass Through Trust and, consequently, to vote such Lessor Notes against the
waiver of the corresponding past default or Indenture Event of Default under
such Indenture, the Lessor Notes so voted by the Pass Through Trustee on behalf
of such Pass Through Trust would not alone be sufficient under the terms of
such Indenture to compel the Indenture Trustee to refrain from giving such
waiver. Moreover, there would be no assurance that the Certificateholders of
any other Pass Through Trust holding Lessor Notes issued under such Indenture
would at such time vote such Lessor Notes against such waiver. Therefore, if
the Certificateholders of a Pass Through Trust or Trusts waive a past default
or Event of Default such that the principal amount of the Lessor Notes held
either individually in such Pass Through Trust or in the aggregate in such Pass
Through Trusts constitutes the required two-thirds of the aggregate unpaid
principal amount under the applicable Indenture, such past default or Indenture
Event of Default under such Indenture will be waived whether or not the
Certificateholders of any other Pass Through Trust holding Lessor Notes issued
under such Indenture waive such past default or Event of Default with respect
to such other Pass Through Trust.
-29-
<PAGE> 31
MODIFICATIONS OF THE AGREEMENTS
The Pass Through Agreement contains provisions permitting the Company
and the Pass Through Trustee to enter into an agreement supplemental to any
Pass Through Trust, without the consent of the Certificateholders of such Pass
Through Trust, to (i) evidence the succession of another corporation to the
Company and the assumption by such corporation of the Company's obligations
under the Pass Through Agreement, (ii) add to the covenants of the Company for
the protection of the related Certificateholders, (iii) surrender any right or
power conferred upon the Company in the Pass Through Agreement, (iv) cure any
ambiguity or correct or supplement any defective or inconsistent provision of
such Pass Through Agreement, or make any other provisions in regard to matters
or questions arising thereunder that will not adversely affect the interests of
the related Certificateholders, (v) correct or amplify the description of
property that constitutes Trust Property or the conveyance of such property to
the Pass Through Trustee, (vi) evidence and provide for a successor Pass
Through Trustee, (vii) modify, eliminate or add to the provisions of the Pass
Through Agreement to the extent necessary to continue to qualify such Pass
Through Agreement under the Trust Indenture Act or any similar Federal statute
enacted thereafter; or (viii) add, eliminate or change any provision under the
Pass Through Agreement that will not adversely affect the interests of the
Certificateholders, provided that in each case such modification does not cause
the Pass Through Trust to become taxable as an "association," within the
meaning of Treasury Regulation Section 301.7701-4. (Pass Through Agreement,
Section 11.01)
Each Pass Through Agreement also provides that the Company and the
Pass Through Trustee, with the consent of the Certificateholders evidencing
fractional undivided interests aggregating not less than a majority in interest
of the affected Pass Through Trust, may execute supplemental agreements adding
any provisions to or changing or eliminating any of the provisions of the Pass
Through Agreement or modifying the rights of such Certificateholders. No such
supplemental agreement may, however, without the consent of each
Certificateholder so affected, (a) reduce in any manner the amount of, or delay
the timing of, any receipt by the Pass Through Trustee of payments on the
Lessor Notes held in such Pass Through Trust, or distributions in respect of
any Pass Through Certificate of such Pass Through Trust, or make distributions
payable in coin or currency other than that provided for in such Pass Through
Certificates, or impair the right of any such Certificateholder to institute
suit for the enforcement of any payment when due, (b) permit the disposition of
any Lessor Note held in such Pass Through Trust, except as provided in the Pass
Through Agreement, or permit the creation of any lien on the Trust Property or
deprive any holder of any such Lessor Note of the benefit of the Lien of the
related Indenture, except as provided therein, (c) reduce the percentage of the
aggregate fractional undivided interests of the Pass Through Trust that is
required to approve any supplemental agreement or any waiver provided for in
the Pass Through Agreement or (d) cause the Pass Through Trust to become
taxable as an "association," within the meaning of Treasury Regulation Section
301.7701-4. (Pass Through Agreement, Section 11.02)
MODIFICATION, CONSENTS AND WAIVERS UNDER
THE INDENTURE AND RELATED AGREEMENTS
If the Pass Through Trustee, as the holder of any Lessor Notes held in
a Pass Through Trust, receives a request for its consent to any amendment,
modification or waiver under the relevant Indenture, or other document relating
to such Lessor Notes (including any Lease), the Pass Through Trustee will mail
a notice of such proposed amendment, modification or waiver to each
Certificateholder of such Pass Through Trust as of the date of such notice.
The Pass Through Trustee will request instructions from such Certificateholders
as to whether or not to consent to such amendment, modification or waiver. The
Pass Through Trustee will vote or consent with respect to such Lessor Notes in
the same proportion as the Pass Through Certificates of such Pass Through Trust
are actually voted by such Certificateholders by a certain date. If an Event
of Default relating to such Indenture has occurred and is continuing under such
Pass Through Trust, the Pass Through Trustee may, in the absence of
instructions from Certificateholders holding fractional undivided interests
aggregating not less than a majority in interest of such Pass Through Trust, in
its own discretion consent to such amendment, modification or waiver, and may
so notify the related Indenture Trustee. (Pass Through Agreement, Section
11.08)
-30-
<PAGE> 32
TERMINATION OF PASS THROUGH TRUSTS
The obligations of the Company and the Pass Through Trustee with
respect to a Pass Through Trust will terminate upon the distribution to the
Certificateholders of such Pass Through Trust of all amounts required to be
distributed to them pursuant to the related Pass Through Agreement and the
disposition of all property held in such Pass Through Trust. The Pass Through
Trustee will notify each Certificateholder of record of such Pass Through Trust
by mail of, among other things, the termination of such Pass Through Trust, the
amount of the proposed final payment and the proposed date for the distribution
of such final payment for such Pass Through Trust. The final distribution for
each Certificateholder of such Pass Through Trust will be made only upon
surrender of such Certificateholder's Pass Through Certificates at the office
or agency of the Pass Through Trustee specified in such termination notice.
(Pass Through Agreement, Section 12.01)
THE PASS THROUGH TRUSTEE
The First National Bank of Chicago ("FNBC") will be the Pass Through
Trustee for each of the Pass Through Trusts. The Pass Through Trustee and any
of its affiliates may hold Pass Through Certificates in their own names. (Pass
Through Agreement, Section 8.05)
FNBC also will be the Indenture Trustee under the Indentures under
which the Lessor Notes have been or will be issued. The Company from time to
time borrows from, and maintains deposit accounts with, FNBC and its
affiliates.
The Pass Through Trustee may resign as trustee under either or both of
the Pass Through Trusts at any time. If the Pass Through Trustee ceases to be
eligible to continue as Pass Through Trustee with respect to a Pass Through
Trust or becomes incapable of acting as Pass Through Trustee or becomes
insolvent, the Company may remove such Pass Through Trustee for such Pass
Through Trust, or any Certificateholder of such Pass Through Trust for at least
six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of such Pass
Through Trustee and the appointment of a successor trustee. In addition, the
Pass Through Trustee of any Pass Through Trust may be removed without cause by
the related Certificateholders holding in the aggregate amount not less than a
majority of the aggregate fractional undivided interests then outstanding in
the Pass Through Trust. In the case of the resignation or removal of the Pass
Through Trustee, the Certificateholders holding in the aggregate not less than
a majority of the aggregate fractional undivided interests then outstanding in
the Pass Through Trust may appoint a successor Pass Through Trustee. The
resignation or removal of the Pass Through Trustee for any Pass Through Trust
and the appointment of the successor trustee for such Pass Through Trust does
not become effective until acceptance of the appointment by the successor
trustee. (Pass Through Agreement, Article X) Pursuant to such resignation and
successor trustee provisions, it is possible that a different trustee could be
appointed to act as the successor trustee with respect to each Pass Through
Trust. All references in this Prospectus to the Pass Through Trustee are to
the trustee acting in such capacity under each of the Pass Through Trusts and
should be read to take into account the possibility that each of the Pass
Through Trusts could have a different successor trustee in the event of such a
resignation or removal.
The Pass Through Agreement provides that the Company will pay the Pass
Through Trustee's fees and expenses and that the Pass Through Trustee will have
a priority claim on the related Trust Property to the extent such fees and
expenses are not paid. The Pass Through Agreement further provides that the
Pass Through Trustee in its individual capacity will be entitled to
indemnification by the Company for, and will be held harmless against, any
loss, liability or expenses (other than income or similar taxes) incurred by
the Pass Through Trustee in its individual capacity in connection with the
administration of any Pass Through Trust, except to the extent incurred through
its own willful misconduct, bad faith or negligence or by reason of a breach of
any of its representations or warranties set forth in the Pass Through
Agreement or any related documents. In certain circumstances, the Pass Through
Trustee will be entitled to be reimbursed from the applicable Pass Through
Trust for any tax (other than income or similar taxes) incurred in its trust
capacity in connection with the administration
-31-
<PAGE> 33
of any Pass Through Trust. (Pass Through Agreement, Articles VIII and IX) See
"Certain Federal Income Tax Consideration"
DESCRIPTION OF THE INDENTURES
The statements under this caption are summaries and do not purport to
be complete. The summaries are qualified in their entirety by reference to the
Indentures, a copy of the form of which has been filed as an exhibit to the
Registration Statement.
GENERAL
The Lessor Notes are to be issued under separate Trust Indentures and
Security Agreements, each to be dated as of July 15, 1994, between the
respective Owner Trustees and The First National Bank of Chicago, as Indenture
Trustee (the "Indentures"). The Lessor Notes will be issued to The First
National Bank of Chicago, as Pass Through Trustee, which will hold the Owner
Trustees' Lessor Notes for the benefit of Certificateholders.
The aggregate principal amount of the Lessor Notes will equal the
aggregate principal amount of the Pass Through Certificates. The Lessor Notes
will bear interest at rates with respect to portions of the principal amounts
thereof which are equal to the interest rates on the Pass Through Certificates
of corresponding principal amounts. Payments of the principal of, Make-Whole
Premium, if any, and interest on, the Lessor Notes will be due in such amounts
and at such times as match exactly the required payment dates, for the
principal of, Make-Whole Premium, if any, and interest on, the Pass Through
Certificates.
PREPAYMENT
The outstanding Lessor Notes shall be redeemed in full, (i) on the
appropriate rent payment date at any time after the issuance thereof in
connection with the occurrence of an Event of Loss under the related Lease if
the Company is required to purchase the undivided ownership interest of an
Owner Trustee in the Facility, (ii) on the appropriate rent payment date
occurring on or after July 5, 2003 in connection with the sale of the undivided
ownership interest of an Owner Trustee in the Facility if the Company exercises
its early termination rights after it determines that the Facility is obsolete
or surplus or uneconomic as described below under "Description of the Leases --
Early Termination Rights;" (iii) if the Company exercises its early purchase
option as described below under "Description of the Leases -- Special Purchase
Option," in which case each Lessor Note will be repayable on January 5, 2012;
or (iv) at any time after the issuance thereof on the date specified in a
redemption notice, in connection with the Company's election to terminate the
Leases and purchase the Facility in certain circumstances if the related Owner
Trustee fails to finance certain modifications proposed for the Facility by the
Company as described below in the third paragraph under "Description of the
Leases -- Modifications." Under any of the above mandatory redemptions, the
Company is obligated to pay a redemption price equal to the outstanding
principal amount of such Lessor Notes plus accrued and unpaid interest on the
Lessor Notes of such Owner Trustee to the date fixed for prepayment, together,
if the prepayment occurs prior to January 5, 2012, with the Make-Whole Premium,
if any, in the case of a redemption of the type contemplated by clauses (ii),
(iii) or (iv) above but without a Make-Whole Premium or other prepayment
penalty of any kind in the case of a redemption of the type contemplated by
clause (i) above or any other redemption occurring on or after January 5, 2012.
If for any reason the Company fails to terminate the related Lease or exercise
its purchase option thereunder as described in clauses (i), (iii) and (iv)
above on the date provided therefor in the related Lease, the related Lessor
Notes would not be redeemed and would remain outstanding and no Indenture
Default and Indenture Event of Default would occur as a result of such
redemption not occurring. (Indenture, Section 2.13; Lease, Sections 8(h),
9(b), 14 and 15)
In addition to the foregoing, without the consent of the related
Holders, the Lessor Notes outstanding under each Indenture may at the option of
the related Owner Trustee (acting upon directions
-32-
<PAGE> 34
of the related Lessee) be redeemed in whole, but not in part, at any time after
the issuance thereof in connection with a refunding of such Lessor Notes, at a
Redemption Price equal to the outstanding principal amount of such Lessor Notes
plus accrued and unpaid interest thereon, together, if the prepayment occurs
prior to January 5, 2012, with a Make-Whole Premium, if any. To the extent
that any such refunding transaction were not to be consummated, the related
Lessor Notes would not be redeemed and would remain outstanding and no
Indenture Default or Indenture Event of Default would occur as a result of such
redemption not occurring or such refunding transaction not being consummated.
(Indenture, Section 2.14)
In addition to the foregoing, each Owner Trustee may, but will not be
obligated to, cause the redemption of all, but not less than all, of the Lessor
Notes issued and outstanding under the related Indenture after an Indenture
Event of Default which is also a Lease Event of Default has occurred and is
continuing at a Redemption Price equal to the outstanding principal amount of
such Lessor Notes, together with interest accrued and unpaid thereon to the
date fixed for prepayment, plus, prior to January 5, 2012, a Make-Whole
Premium; provided that if the Indenture Trustee has given the Owner Trustee the
requisite notice of its intent to accelerate such Lessor Notes as a result of
such Lease Event of Default, any such prepayment will be without any Make-Whole
Premium or other prepayment penalty of any kind. (Indenture, Section 2.12)
The "Make-Whole Premium" means the excess, if any, of (a) the net
present value of the remaining scheduled principal and interest payments in
respect of the outstanding Lessor Notes discounted to the applicable redemption
date on a semiannual basis at the Treasury Rate (as defined below) over (b) the
aggregate principal amount of the Lessor Notes to be redeemed on such
redemption date plus any accrued and unpaid interest thereon, as calculated by
an independent investment banking institution of national standing appointed by
the Company on behalf of the Owner Trustee (or directly by the Owner Trustee if
any Lease Event of Default exists).
The "Treasury Rate" means, with respect to the determination of a
Make-Whole Premium, (i) in the case of a Lessor Note bearing a final stated
maturity of less than one year after the related redemption date, a rate of
interest per annum, determined by the independent investment banking
institution as of the third Business Day preceding the applicable redemption
date, equal to the average yield to maturity of, and resulting from the bidding
for (on government bond equivalent basis), the applicable United States
Treasury Bill due the week in which such final stated maturity occurs or (ii)
in the case of all other Lessor Notes, a rate of interest per annum determined
by the independent investment banking institution as of the third Business Day
preceding the applicable redemption date, to be equal to the average yield to
maturity of, and resulting from the bidding for, the most comparable United
States Treasury Notes, as identified by the independent investment banking
institution, corresponding in maturity to the Weighted Average Life to Maturity
(as described below) of the Lessor Notes then subject to the related redemption
(or, if there is no maturity corresponding to such Weighted Average Life to
Maturity, an interpolation, on a straight-line basis, between the yield on (a)
the United States Treasury Note with a constant maturity closest to and greater
than the Weighted Average Life to Maturity of such Lessor Notes and (b) the
United State Treasury Note with a constant maturity closest to and less than
such Weighted Average Life to Maturity); such yield to be determined by the
independent investment banking institution by reference to the yield of the
relevant United States Treasury Notes as published in "Statistical Release H.15
(519), Selected Interest Rates" (or any successor publication) by the Board of
Governors of the Federal Reserve System at or prior to 12:00 noon, New York
time, on the third Business Day preceding the applicable redemption date.
The "Weighted Average Life to Maturity" means, with respect to any
indebtedness as at the time of determination thereof, the number of years
obtained by dividing the then Remaining Dollar Years of such indebtedness by
the then outstanding principal amount of such indebtedness. The term
"Remaining Dollar Years" of any indebtedness means the amount obtained by (i)
multiplying the amount of each then remaining sinking fund, serial maturity or
other required repayment of principal, including repayment at final maturity,
by the number of years (calculated to the nearest 1/12) which will elapse
between the
-33-
<PAGE> 35
date of determination and the date of that required repayment, and (ii)
totalling all the products obtained in the preceding clause (i).
INDENTURE EVENTS OF DEFAULT
"Events of default" under each Indenture ("Indenture Events of
Default") include: (a) any Lease Event of Default under the related Lease
(other than the failure of the Company to pay certain amounts to the Owner
Trustees which are not assigned as security for the Lessor Notes ("Excepted
Payments") and subject to the rights of the Owner Trustee to cure defaults in
the payment of rent described below and to purchase the Lessor Notes as
described under "-- Prepayment," (b) a failure by the Owner Trustee to pay any
amount of principal of, Make-Whole Premium, if any, or interest on any Lessor
Note within five Business Days after the same becomes due under such Lessor
Note or under the Indenture; (c) any representation or warranty made by any
Owner Participant in the Participation Agreement or by the Owner Trustee in the
Indenture or in the Participation Agreement proves to have been false or
incorrect in any material respect when made or given and remains a
misrepresentation or breach of warranty which is material and adverse to the
Holders or their interests in the related Indenture Estate at the time such
matter is brought to the attention of the related Indenture Trustee; provided,
however, that such misrepresentation or breach of warranty shall not be an
Indenture Event of Default unless all consequences thereof are not cured within
60 calendar days after written notice of the matter is given to the related
Owner Trustee and Owner Participants by the Indenture Trustee; (d) a failure by
the Owner Trustee to observe or perform certain covenants or obligations to be
performed or observed by it under the Participation Agreement or any failure by
the Owner Participants to observe or perform certain covenants or obligations
of the Owner Participants under the Participation Agreement which are to or for
the benefit of the Indenture Trustee or the Holder of any Lessor Note and are
not remedied within a period of 60 calendar days after notice thereof has been
given to the Owner Trustee and the Owner Participant by the Indenture Trustee;
provided that if such failure to comply cannot be cured by the payment of money
within such 60 day period, such failure to comply will not be an Indenture
Event of Default so long as the Owner Trustee or the Owner Participant, as the
case may be, diligently pursues such cure (but such cure period may not exceed
360 days); or (e) the occurrence of certain specified bankruptcy, insolvency,
reorganization or similar events with respect to the related Trust Estate or
the Owner Trustee. (Indenture, Section 4.01)
There are no cross-defaults to other debt instruments of the Company
in the Indentures, but, indirectly, the Leases are cross-defaulted insofar as
each would be treated as a Financing Lease and each Lease would be defaulted if
the Company is in default under a Financing Lease. Consequently, any event
resulting in an Indenture Event of Default under one Indenture will not, in and
of itself, result in the occurrence of an Indenture Event of Default under any
other Indenture.
RIGHTS OF OWNER TRUSTEES TO CURE, PREPAY AND ACCELERATE THE LESSOR NOTES
Each Indenture provides that an Indenture Event of Default thereunder
is to be deemed cured (i) if such Indenture Event of Default results from a
non-payment of interim or basic rent under the related Lease, if the Owner
Trustee, upon instruction from the Owner Participant, pays a sum equal to the
amount of all principal and interest then due and payable on the related Lessor
Notes within 15 Business Days after notice of such Indenture Event of Default
has been given by the Indenture Trustee to the related Owner Trustee and Owner
Participants or (ii) if such Indenture Event of Default relates to a default by
the Company in any obligation under such Lease other than the payment of
interim or basic rent, if the Owner Trustee, upon instructions of the Owner
Participants, performs such obligation on behalf of the Company at any time
prior to 15 Business Days after notice of such Indenture Event of Default has
been given by the Indenture Trustee to the related Owner Trustee and Owner
Participants. For purposes of determining whether an Indenture Event of
Default shall have occurred, timely payment or performance by the related Owner
Trustee of the amounts or obligations referred to in the two preceding
sentences shall, to the extent of such payment or performance, be deemed to
remedy any Lease Event of Default with respect thereto or any default by such
Owner Trustee in the payment of any amount due and payable under the related
Lessor Notes or Indenture. In such event, the Owner Participants are
-34-
<PAGE> 36
subrogated to the rights of the Holders of the Lessor Notes under the related
Indenture to receive the relevant rent payments from the Indenture Trustee in
accordance with the Indenture and is entitled to receive payment of such upon
receipt thereof by the Indenture Trustee, provided that such Lessor Notes have
not been accelerated pursuant to Section 4.03 of the Indenture.
Notwithstanding the foregoing, such Owner Trustee shall not be permitted to
cure more than three consecutive or six cumulative defaults in the payment of
interim rent or basic rent. The Indenture Trustee shall not exercise any
remedies under the Indenture or under the lease during any period in which the
Owner Trustee may cure a default by the Company as provided in Section 4.02 of
the Indenture. (Indenture, Section 4.02)
Each Owner Trustee also has the right to prepay the related Lessor
Notes during the continuance of an Indenture Event of Default which is the
result of a Lease Event of Default as described above under "-- Prepayment."
Each Owner Trustee may also declare the related Lease in default after
a Lease Event of Default and exercise its right to demand payment of the
stipulated loss value of its interest in the Facility. In such event, upon
receipt by the Indenture Trustee of such stipulated loss value, the principal
amount of the related Lessor Notes will be deemed to have been declared due and
payable.
NOTICE OF EVENTS OF DEFAULT; ACTION BY TRUSTEE; WAIVER
In the event the Indenture Trustee has knowledge of a default, or
event of default under its Indenture, the Indenture Trustee is required to give
prompt written notice thereof to the related Owner Participants, Lessee,
Holders and Owner Trustee. The Indenture Trustee will only be deemed to have
such knowledge if an officer in its Corporate Trust Services Division has
actual knowledge thereof unless notified in writing by the Company, the Owner
Trustee or one or more related Holders, except that the failure of the Company
to pay any installment of interim rent or basic rent due under the Lease within
one Business Day will constitute such knowledge. Notwithstanding the
foregoing, if such Indenture Trustee exercises any remedies under the related
Lease or elects to foreclose or otherwise enforce its Indenture, it will be
required to notify the related Owner Participants, Owner Trustee, Lessee and
Holders. Subject to the terms of each Indenture dealing with the enforcement
of remedies and the rights of the Indenture Trustee to indemnification in the
taking of any action, and further subject to the right of the Owner Trustee to
cure defaults as described above, the related Indenture Trustee will be
required to take, or refrain from taking, such action as shall be instructed in
writing by a Majority in Interest of Holders of the Lessor Notes or, in the
absence of such instructions, may (but shall be under no duty to) take such
action, or refrain from taking such action, as it shall determine to be
advisable and in the best interests of the Holders. In the event that an
Indenture Event of Default has occurred and is continuing, such Indenture
Trustee will be required to exercise such of the rights and powers vested in it
under its Indenture, and use the same degree of care and skill in the exercise
thereof, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs. Any action that an Indenture Trustee may take,
whether or not in respect of instructions received from the related Holders,
will be subject to the provisions and limitations of the Transaction Documents
and applicable law. Such limitations will include, as well as the matters
discussed above and the matters discussed below under the caption "Remedies,"
provisions in each Indenture to the effect that the Indenture Trustee
thereunder will not be required to take any action or refrain from taking any
action thereunder unless it has been indemnified against any liability, cost or
expense (including counsel fees) which may be incurred in connection therewith.
No Indenture Trustee shall be under any obligation to take any action under its
Indenture, and nothing therein shall require it to expend or risk its own funds
or otherwise incur any financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers, if it has reasonable
grounds for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured. In addition, no
Indenture Trustee will be required to take any action under its Indenture if it
has been advised by counsel that such action is contrary to the terms thereof
or of the related Transaction Documents, or is otherwise contrary to law.
(Indenture, Sections 5.01, 5.02 and 5.03)
-35-
<PAGE> 37
If an Indenture Event of Default occurs and is continuing, any sums
held or received by the related Indenture Trustee may be applied to reimburse
such Indenture Trustee and the related Pass Through Trustee for any tax,
expense or other loss incurred by them and to pay any other amounts due to them
prior to any payments to the related Holders. (Indenture, Article III)
A Majority in Interest of Holders of the Lessor Notes issued under an
Indenture may on behalf of all Holders direct the related Indenture Trustee to
waive any past default under such Indenture and its consequences, except that
consent from each related Holder is required with respect to a waiver of such a
default in respect of the payment of the principal of, Make-Whole Premium, if
any, or interest or other amounts due on any Lessor Note then outstanding under
such Indenture or in respect of any covenant or provision of such Indenture
that, pursuant to the provisions thereof, could not be modified or amended
without the consent of each such Holder. (Indenture, Section 4.07)
Each Lessee is required under the provisions of the related
Participation Agreement to furnish an annual certificate stating whether, to
the knowledge of the officer delivering such certificate, there exists any
Lease Event of Default, Lease Default or Event of Loss, and if any such event
exists, stating its nature and period of existence and what action such Lessee
is taking and proposes to take with respect thereto. (Participation Agreement,
Section 10(b)(i)(D))
REMEDIES
Each Indenture provides that, after the expiration of the periods in
which an Owner Trustee may exercise its cure rights as described above under
the caption "-- Rights of Owner Trustees to Cure, Prepay and Accelerate the
Lessor Notes," and subject to the matters described below, if any Indenture
Event of Default has occurred and is continuing thereunder, upon the giving of
any requisite notice to the Owner Trustee and the Owner Participant the related
Indenture Trustee may at any time, and, upon instructions from the Majority in
Interest of the Holders of the related Lessor Notes, will, declare all such
Lessor Notes to be due and payable. Notwithstanding the foregoing, if, prior
to such declaration the related Owner Trustee delivers the requisite notice
exercising its right to redeem the relevant Lessor Notes as described in "--
Prepayment" above, the Indenture Trustee's right to declare all such Lessor
Notes due and payable shall be suspended until the relevant redemption date.
If an Owner Trustee has declared the related Lease in default after a Lease
Event of Default and the Indenture Trustee has received payment of the related
stipulated loss value, the principal amount of the related Lessor Notes will be
deemed to have been declared due and payable. If at any time after the
principal of such Lessor Notes is declared due and payable, and before any
judgment or decree for the payment of the money so due, or any thereof, is
entered, all overdue payments of interest upon such Lessor Notes and all other
amounts payable under such Lessor Notes (except the principal of such Lessor
Notes which by such declaration shall have become payable) shall have been duly
paid, and every other Indenture Event of Default with respect to any covenant
or provision of the related Indenture shall have been cured, then and in every
case such a Majority in Interest of Holders of such Lessor Notes may rescind
and annul the Indenture Trustee's declaration and its consequences; but no such
rescission or annulment will extend to or affect any subsequent Indenture Event
of Default or impair any right consequent thereon or require any Holder to
repay any amount received as a result of such declaration. (Indenture, Section
4.03)
If the Lessor Notes have been accelerated and so long as such
acceleration is not rescinded, the related Indenture Trustee may exercise
certain rights or remedies available to it under applicable law and, if a Lease
Event of Default under the related Lease has occurred, one or more of the
remedies afforded to the related Owner Trustee under its Lease in respect of
Events of Default thereunder, provided that such Indenture Trustee is required
to give the related Owner Participants and Owner Trustee at least thirty
calendar days notice of any public or private auction of the related Undivided
Interest and other properties covered by such Indenture. Any sale or other
transfer of such properties will be at such prices, on such terms and in such
manner as may be deemed appropriate by the related Indenture Trustee. Any
properties sold in the exercise of such remedies will be free and clear of any
rights or interests of the related Owner Trustee. (Indenture, Section 4.03)
-36-
<PAGE> 38
Notwithstanding the rights and powers of each Indenture Trustee
described above, so long as an Indenture Event of Default that is also a Lease
Event of Default has occurred and is continuing, the Indenture Trustee shall
not proceed to foreclose the Lien of its Indenture or exercise any other
remedies thereunder, unless it proceeds (to the extent it has not already done
so) to declare such Lease to be in default and commence the exercise of
remedies thereunder to terminate such Lease, dispossess the Company of its
leasehold estate with the undivided ownership interest or take contemporaneous
comparable action (whether or not its ability to exercise any such remedies is
limited by any bankruptcy or insolvency proceedings affecting the Company).
WITHHOLDING TAXES
Each Indenture provides that the Indenture Trustee is required, to the
extent required by law, to deduct withholding taxes (and deposit the same with
the relevant governmental authorities) from any payments in respect of a Lessor
Note. For all purposes of the related Transaction Documents, any amounts so
withheld by such Indenture Trustee from a payment due to a Holder shall be
deemed to have been received by such Holder, and such Holder shall not be
entitled to any indemnification in respect of such withholding from any party
to such Transaction Documents. Purchasers should consult with their tax
advisers with respect to withholding tax matters. (Indenture, Sections 2.04
and 5.02)
MODIFICATION OF TRANSACTION DOCUMENTS;
CERTAIN WAIVERS
Certain provisions of the Leases may be modified or amended, and any
consents, waivers, authorizations or approvals in respect thereof may be given,
in either case without the consent of the Holders of the related Lessor Notes
or the related Indenture Trustee; provided that the following provisions of the
Leases may not be modified or amended without the consent of a Majority in
Interest of Holders of the Lessor Notes: (i) the events constituting Events of
Default; or (ii) the remedies available to an Owner Trustee upon the occurrence
of an Event of Default. To the extent that amendments or modifications in
respect of the related Transaction Documents do require the consent of the
Holders, such consent may, except as provided in the next succeeding paragraph,
be given by a Majority in Interest of Holders of the Lessor Notes under the
relevant Indenture. (Indenture, Section 8.01)
Notwithstanding the foregoing, without the consent of each Holder of a
Lessor Note affected thereby, no amendment or modification of the related
Indenture, Lease or Participation Agreement may, among other things, (a) extend
the time of payment of any amount owing or payable in respect of such Lessor
Note or reduce the principal amount of such Lessor Note or the amount of any
Make-Whole Premium, if any, or of any payment of principal or interest due on
such Lessor Note, (b) change the dates on which any principal, Make-Whole
Premium, if any, or interest is due on such Lessor Note or (c) create any Lien
with respect to the property subject to the Lien of the related Indenture
ranking prior to or on a parity with the security interest created thereby
(except in connection with the issuance of Supplemental Financing Notes or as
otherwise permitted by such Indenture), (d) reduce the percentage in principal
amount of the Lessor Notes, the consent of whose Holders is required for any
such supplemental agreement, or the consent of whose Holders is required for
any waiver of compliance with the provisions of the Indenture or of or in
respect of any Indenture Default or Indenture Event of Default or of any
receipt of payment; or (e) make any change in Section 8.01A of the Indenture.
(Indenture, Section 8.01A)
With respect to each Indenture, without the consent of any of the
Holders of the Lessor Notes then outstanding, the Indenture Trustee and the
Owner Trustee (in certain circumstances with the consent of the Company) may
enter into any indenture supplements (i) to evidence the appointment of a
successor Owner Trustee or Indenture Trustee; (ii) to subject to the Lien of
the Indenture the related Owner Trustee's Share of Components or Modifications
to the Facility; (iii) to make such modifications requested by such Owner
Trustee as are appropriate in the event that there are multiple Owner
Participants; (iv) to cure any ambiguity, to correct or supplement any
provision in the related Indenture
-37-
<PAGE> 39
which may be inconsistent with any other provision therein; (v) to provide for
the issuance of Supplemental Financing Notes as contemplated by the Indenture;
or (vi) to add to the rights of the Holders or the Indenture Trustee.
(Indenture, Section 8.02)
LIMITATION OF LIABILITY OF OWNER TRUSTEES
The Lessor Notes which secure the Pass Through Certificates are not
direct obligations of, or guaranteed by, the Company. Neither any Owner
Participant nor The First National Bank of Chicago shall be liable to any
holder of a Lessor Note or for any amounts payable under the Lessor Notes or,
except as provided in the Indentures, for any obligation under the Indentures.
All payments of principal of, Make-Whole Premium, if any, and interest on, the
Lessor Notes will be made only from the assets subject to the Lien of the
respective Indentures or the income and proceeds received by the Indenture
Trustee therefrom (including basic rent and certain other amounts payable by
the Company under the Leases). (Indenture, Section 2.05)
SUPPLEMENTAL FINANCING NOTES
With respect to each Indenture, at the request of the Company and so
long as no Indenture Event of Default that constitutes a Lease Event of Default
exists, the Owner Trustee and the Indenture Trustee shall execute and deliver
an Indenture Supplement providing for the creation of supplemental financing
notes ("Supplemental Financing Notes") in connection with the financing of any
alteration, modification, additions or improvements to the Facility. Such
Indenture Supplement shall set forth the maximum principal amount, text,
maturity date, rate of interest on, terms for repayment, prepayment or
redemption and any other particulars necessary to describe and define such
Supplemental Financing Notes. (Indenture, Section 2.15(a))
No Supplemental Financing Notes may be issued under an Indenture
without the consent of the holders of two-thirds of the aggregate unpaid
principal amount of the Lessor Notes issued under such Indenture if (i) the
Weighted Average Life to Maturity of such Supplemental Financing Notes as of
the date of issuance of such Supplemental Financing Notes would be shorter than
that of the related Lessor Notes then outstanding; (ii) such Supplemental
Financing Notes would be issued for an amount less than 100% of face amount
thereof; (iii) such Supplemental Financing Notes would benefit from the same
collateral security, guarantees, indemnity rights or other support or rights
securing, supporting or applicable to the Lessor Notes then outstanding; or
(iv) the following conditions set forth in the Lease have not been satisfied:
(x) both such Lessor Notes and the Supplemental Financing Notes will be rated
BBB- or higher in the case of Standard & Poor's or Baa3 or higher in the case
of Moody's upon completion of the Supplemental Financing, and the Company will
not be on credit watch for a possible downgrade, (y) the term of the
Supplemental Financing Notes will not extend beyond the Basic Lease Term and
(z) the Supplemental Financing Notes issued under both Indentures are in a
principal amount in excess of $10,000,000 and the principal amount of such
Supplemental Financing Notes issued under both Indentures, together with all
prior issues of the Supplemental Financing Notes issued under both Indentures,
is less than $40,000,000. Such Supplemental Financing Notes will be subject to
the Lien of the applicable Indenture and will be issued pari passu with the
other Lessor Notes. No holder of a Pass Through Certificate, as such, will have
any right to, or interest in, any Supplemental Financing Note. (Indenture,
Section 2.15(b))
INDENTURE TRUSTEES
If the Lessor Notes have been accelerated and such acceleration has
not been rescinded, any sums held or received by the Indenture Trustee may be
applied to the payment of obligations incurred by the Indenture Trustee and the
Pass Through Trustee prior to any payments to holders of Lessor Notes.
(Indenture, Section 3.03) Subject to certain limitations, if there is an
Indenture Event of Default when the Indenture Trustee receives a rent
installment, then the Indenture Trustee may retain such payments until the
earlier of certain conditions have been met. (Indenture 3.03(b))
-38-
<PAGE> 40
Each Indenture provides that the Indenture Trustee shall not be
answerable or accountable under any circumstances, unless for its own wilful
misconduct or gross negligence, and except for liabilities on account of
representations, warranties or covenants made by it in its individual capacity.
Each Indenture further provides that, in the case of any event of default under
any Indenture and the acceleration of the Lessor Notes, the Indenture Trustee
shall exercise such of the rights and remedies vested in it by such Indenture
and shall use the same degree of care in their exercise as a prudent man would
exercise or use in the circumstances in the conduct of his own affairs,
provided that if in the opinion of the Indenture Trustee such action may tend
to involve expense or liability, it shall not be obligated to take such action
unless it is furnished with an indemnity satisfactory to it. (Indenture,
Sections 3.07, 5.02 and 5.04)
SCHEDULED PAYMENTS
The following table sets forth the principal repayment schedule on the
Lessor Notes.
CERTAIN CONSIDERATIONS IN THE EVENT OF BANKRUPTCY
In the event a bankruptcy case is filed with respect to the Company,
Section 365 of the Bankruptcy Code gives to a trustee in bankruptcy or a
debtor-in-possession acting for the Company the right to reject the Lease and
disaffirm any further obligations thereunder. In the event of such a
rejection, the Owner Trustee and the Indenture Trustee would be entitled to
possession of the Facility and could assert an unsecured claim against the
Company for damages because of the early termination of the Lease. Although
the Company and the Owner Trustee have agreed that the Facility shall be deemed
to be severed from the Site Interest, if the Lease were determined to be a
lease of real property, the amount of such claim would be limited under Section
502 of the Bankruptcy Code to the sum of (i) any accrued and unpaid rent
(without giving effect to any early termination penalties) as of the
commencement date of the bankruptcy proceeding plus (ii) rent payable under the
Lease (without giving effect to any early termination penalties) for a period
equal to the greater of one year or 15% of the remaining term of the Lease from
the date of commencement of the bankruptcy proceedings (assuming the Company
was in possession of the Facility on that date).
In the event of a bankruptcy of an Owner Participant, it is possible
that, notwithstanding that such Owner Participant's interest in the Facility is
owned by the Owner Trustee in trust, the related Leases, the related Owner
Trustee and the Lessor Notes might become affected by the bankruptcy
proceedings. In such event, payments under the related Leases or on the Lessor
Notes might be interrupted and the ability of the Indenture Trustee to exercise
its remedies under the related Indenture might be restricted, although the
Indenture Trustee would retain its status as a secured creditor in respect of
the related Lease and the related undivided ownership interest in the Facility.
DESCRIPTION OF THE LEASES
The statements under this caption are summaries and do not purport to
be complete. The summaries are qualified in their entirety by reference to the
Leases, a copy of the form of which has been filed as an exhibit to the
Registration Statement.
TERM AND RENTALS
The Owner Trustees will acquire separate undivided ownership interests
in the Facility aggregating 100% and will lease such interests to the Company
pursuant to separate Leases, each having a lease term expiring on September 28,
2015, unless earlier terminated or extended as described below (the "Basic
Lease Term"). Basic rent is required to be paid by the Company under the
Leases in immediately available funds on each January 5 and July 5, commencing
on and after January 5, 1995 unless the scheduled due date is not a business
day, in which case such basic rent is required to be paid in immediately
available funds, together with interest thereon, on the next business day with
the same effect as though made on the due date. (Lease, Section 3(a) and 3(d))
The basic rent payable under each Lease on each payment date and any stipulated
loss value or termination value (both of which are predetermined amounts
required to be paid to the related Owner Trustee upon termination of its
investment in the Facility, plus amounts necessary to prepay the Lessor Notes
of each Owner Trustee) payable on any date on which such payment is due, is
required to be at least equal to all principal of, Make-Whole Premium, if any,
and interest on the Lessor Notes of such Owner Trustee then due and payable on
such date. (Lease, Section 3(g)) Except in the case of a default or event of
default under the related Indenture, each payment of basic rent by the Company
during such time as such Indenture is in effect will be made and applied,
first, to the payment of principal and interest due from a Owner Trustee on its
Lessor Notes on each January 5 and July 5, unless the scheduled payment date is
not a business day, in which case such payment is required to be made on the
next business day with the same effect as though made on the date due.
(Indenture, Sections 2.06 and 3.01) The balance of any payments of basic rent
under the Leases, after payment of the scheduled principal and interest on the
Lessor Notes, will be paid over to the respective Owner Participants, as
beneficial owners of the undivided ownership interests in the Facility.
(Indenture, Section 3.01)
NET LEASE
The obligations of the Company under each Lease will be those of a
Lessee under a "net lease." Accordingly, the Company will agree that it will,
at its own cost and expense, (i) operate, service, repair and maintain the
Facility and Site Interest (including replacement of components and the making
of
-39-
<PAGE> 41
required modifications) so that the condition and operating efficiency thereof
will be maintained and preserved, ordinary wear and tear excepted, in
accordance with (x) prudent mining industry practice for property or systems of
a similar size and nature in the western region of the United States of
America, (y) such operating standards as shall be required to enforce warranty
claims against any contractor, vendor, manufacturer, or subcontractor, and (z)
the terms and conditions of all insurance policies in effect at any time with
respect to the Facility, the Site Interest, any component incorporated therein
or the undivided ownership interest, and (ii) comply with any applicable laws,
whether pertaining to health, safety, the environment or otherwise, affecting
the Facility, the Site Interest, any component incorporated therein or the
undivided ownership interest, and the use, operation and maintenance thereof
unless the validity or applicability of any such law is being contested as
permitted under such Lease. (Lease, Sections 8(a), 8(c), 8(d) and 8(k))
The Company's obligation to pay all rents under the Leases is absolute
and unconditional and is not to be affected by any set-off, abatement,
counterclaim, suspension, recoupment, reduction, defense, or any other right
which the Company may have against the Owner Trustees, the Owner Participants,
the Indenture Trustees, or any other Person. (Lease, Section 4)
LIENS
Other than certain permitted liens, the Company may not create, incur,
assume or suffer to exist any Liens on or with respect to the Facility, any
component incorporated therein or the undivided ownership interest, or the
Owner Trustee's title thereto or any interest of the Owner Trustee therein.
The Company will, promptly, at its own expense, take such action as may be
necessary to discharge any such Lien created. (Lease, Section 7)
MODIFICATIONS
The Company has the right to make optional alterations, modifications,
additions or improvements to the Facility, provided, among other things, that
no such alterations, modifications, additions or improvements impair the value,
utility or useful life of the Facility. (Lease, Section 8(d)) At its expense,
the Company must make any alterations, modifications, additions or improvements
to the Facility as may reasonably be required from time to time to maintain the
Facility in accordance with prudent mining industry practice for property or
facilities of a similar size and nature in the Western region of the United
States of America or to meet the requirements of any applicable laws. (Lease,
Section 8(d)) Title to alterations, modifications, additions and improvements
vests in the Owner Trustees to the extent of their undivided interests in the
Facility unless such alteration, modification, addition or improvement (i) was
not required to be made by the Leases, (ii) may be removed without reducing the
value, utility or condition which the Facility would have had if the same had
not been made, and (iii) was not financed by the Owner Trustees as provided in
the Leases. (Lease, Section 8(f))
With respect to each Lease the Company may request that the Owner
Trustee provide financing to the extent of its undivided interests in any
alteration, modification, addition or improvement incorporated in the Facility
("Supplemental Financing"). Provided no Bankruptcy Default, Payment Default or
Lease Event of Default exists, and the Company elects to effect, and arranges,
such a transaction, the Owner Trustee may issue one or more Supplemental
Financing Notes under the related Indenture, which notes shall be pari passu
with the other Lessor Notes issued on the Closing Date. The Supplemental
Financing Notes will only be issued upon satisfaction of certain conditions
contained in the Lease.
The Company has the right to terminate either Lease and purchase the
Facility for (i) the applicable termination value if the Company shall propose
financing of required modifications having an aggregate capital cost greater
than $20,000,000, or (ii) the higher of fair market value or termination value
if the Company shall propose optional, non-severable modifications having an
aggregate cost greater than $20,000,000. In either case, the Company has such
right to terminate such Lease only if the related Owner Trustee declines to
effect a Supplemental Financing or the Company and such Owner Trustee are
-40-
<PAGE> 42
unable to reach agreement on financing with respect to such modifications.
(Lease, Section 8(h)). The Company may only exercise its right to purchase the
Facility as described above, if it concurrently exercises its parallel right
under the other Lease. (Lease, Section 21(f))
POSSESSION, SUBLEASE AND TRANSFER
The Company is not permitted to assign its leasehold interest under
either Lease to any person without the prior written consent of the related
Owner Trustee, provided, however, that the Company may assign its leasehold
interest to any of its affiliates, but unless the related Owner Participants
and Indenture Trustee have consented to such assignment, the Company shall
remain primarily liable for the performance of its obligations under such
Lease. So long as the senior unsecured debt of the Company shall be rated BBB-
or higher in the case of Standard & Poor's or Baa3 or higher in the case of
Moody's, the Company may, without the consent of the Owner Trustees, sublease
the undivided interests or Facility to any person. Notwithstanding any such
sublease, the Company shall remain primarily liable for the performance of its
obligations under the Leases. (Lease, Section 12). The Company may only
assign or sublease its interest in the Facility as described above, if it
concurrently takes the same action under the other Lease. (Lease, Section
21(f))
INSURANCE
The Company is required under the Leases, at its own cost and expense,
to cause to be carried and maintained property insurance, with financially
sound and reputable insurers satisfactory to the Owner Trustees, against damage
or destruction of the Facility and covering full replacement cost, and general
liability insurance with respect to third party bodily injury and property
damage, in each case in amounts (after deductibles or self-insurance amounts)
and against risks (i) consistent with prudent mining industry practice for
property or facilities of a similar size and nature in the western region of
the United States of America, (ii) at least comparable in amounts and against
risks customarily insured against by the Company for its other properties in
the western region of the United States of America and (iii) sufficient to
prevent each Owner Trustee or Indenture Trustee from becoming at any time a
co-insurer with respect to any loss relating to events or occurrences covered
under any policy.
Provided no Bankruptcy Default, Payment Default or Lease Event of
Default exists, all insurance proceeds (except under insurance separately
maintained by the Owner Participants) up to $10,000,000 on account of any
physical loss or damage to the respective undivided ownership interest, the
Owner Trustee's interest in the Easements or the Site Interest or any part
thereof (less the actual costs, fees and expenses incurred in the collection
thereof) will be paid to the Company, and all insurance proceeds (except under
insurance separately maintained by the Owner Participants) equal to or greater
than $10,000,000 in the aggregate on account of physical loss or damage will be
paid to the Indenture Trustee and all such proceeds shall be applied and dealt
with as follows: (i) except as provided in clause (ii) below, all such
proceeds shall be paid over, upon the satisfaction of certain requirements, to
the Company as restoration progresses, to pay (or reimburse the Company for)
the cost of restoration and (ii) all such proceeds in respect of an Event of
Loss for which no election by the Company to restore or replace the damaged or
lost portion of the Facility has been (or can be) made as described under "--
Event of Loss" below shall be applied to pay the stipulated loss value of the
Facility and any excess loss proceeds shall be paid to the Company or the
related Owner Trustee as their respective interests may appear. (Lease,
Sections 10(a) and 10(b))
SPECIAL PURCHASE OPTION
The Company has the option under each of the Leases to purchase each
Owner Trustee's undivided ownership interest in the Facility in certain
circumstances, including on January 5, 2012, exercisable by giving not less
than 180 days' written notice, for a purchase price in immediately available
funds in an amount equal to the Early Buy-Out Price (being a predetermined
percentage of the Facility Cost), plus any other rent then due.
-41-
<PAGE> 43
The Company may only exercise this right to purchase the Facility if
it concurrently exercises its parallel right under the other Lease. (Lease,
Section 21(f))
Each Indenture requires, as a condition to the release of the Lien of
such Indenture upon the exercise of this right, among other things, that the
Indenture Trustee has received full payment of all principal of, Make-Whole
Premium, if any, and interest on, the Lessor Notes. (Indenture, Section 9.01)
EARLY TERMINATION RIGHTS
After July 5, 2003, the Company may terminate each Lease if (i) it, in
its sole discretion, determines that the Facility is obsolete or surplus or
uneconomic for the Company's needs, (ii) the Facility is in the requisite
condition and repair, and (iii) no Lease Event of Default, Payment Default or
Bankruptcy Default exists. Such termination shall occur on a rent payment date
and is exercisable not less than 6 months after the Company has given written
notice of its termination. Upon such termination, the Company (unless the
relevant Owner Trustee elects to retain the undivided ownership interest in the
Facility as described below) shall pay the Owner Trustee the termination value
of its interest in the Facility plus all unpaid rent then due and payable. If
no sale of the undivided ownership interests shall have been completed on the
termination date, the Lease will continue in full force and effect. (Lease,
Section 15(a)) The Company may only exercise its early termination rights as
described above, if it concurrently exercises its parallel rights under the
other Lease. (Lease, Section 21(f))
If by 45 days' notice prior to the termination date, the Owner Trustee
elects to retain, rather than sell the undivided ownership interests, which it
may do only with the consent of the related Owner Participants, then the Owner
Trustee will pay to the Indenture Trustee an amount equal to the principal
amount of the outstanding Lessor Notes to be redeemed in connection with such
termination plus all interest accrued, and Make-Whole Premium, if any as
provided for in the Indenture. If the Owner Trustee elects to retain the
undivided ownership interest, the Company shall not be required to pay any
termination value. (Lease, Section 15(b); Indenture, Section 3.02)
EVENTS OF LOSS
If any Event of Loss occurs with respect to the Facility, the
Easements or the Site Interest, the Company shall purchase either Owner
Trustees' undivided ownership interests in the Facility by paying or causing to
be paid to each Owner Trustee on the first following rent payment date
occurring at least 20 days after such Event of Loss the stipulated loss value
of such Owner Trustee's undivided ownership interest in the Facility (being a
predetermined amount required to be paid to the related Owner Participant upon
termination of its investment in the Facility, plus amounts necessary to prepay
the Lessor Notes of each Owner Trustee); provided that where such Event of Loss
results from loss, damage or destruction of the Facility or Site Interest, the
Company may, under certain circumstances, not later than 60 days prior to such
scheduled payment date, irrevocably elect to and shall thereafter rebuild and
restore the Facility and Site Interest to the condition in which it was
required to be maintained at the time of such Event of Loss, in which case each
Lease shall continue to be in full force and effect. If the Company pays the
stipulated loss value then required to be paid (which in all circumstances will
be in excess of the principal of, Make- Whole Premium, if any, and interest on,
the Lessor Notes then outstanding), the Lien of each Indenture and each Lease
will terminate with respect to the Facility, title thereto shall be transferred
to the Company, the obligation of the Company thereafter to make rental
payments with respect to the Facility will cease, and the aggregate of the
stipulated loss value payments made by the Company shall be applied as provided
in the Indenture to the payment of all amounts then due and payable to the
Indenture Trustee and the Pass Through Trustee under the Transaction Documents
and the prepayment of the Lessor Notes. (Lease, Section 9(b); Indenture,
Sections 3.02 and 9.01) The Company may only purchase an Owner Trustee's
undivided ownership interest in the Facility as described above, if it
concurrently takes the same action under the other Lease. (Lease, Section
21(f))
An Event of Loss under each Lease means any of the following events:
-42-
<PAGE> 44
(a) the Facility (including the undivided ownership interests) or the
Site Interest is, or the rights in the Easements are, (i) destroyed, damaged
beyond repair or, in the good faith and reasonable opinion of the Company
(confirmed by an independent engineer reasonably satisfactory to the Owner
Participant) rendered permanently unfit for normal use for any reason
whatsoever, (ii) condemned, confiscated or seized in whole or any significant
part, for a period which extends beyond the expiration of the Basic Lease Term,
or (iii) not operated by the Company for its intended use for a period
exceeding two years; or
(b) title to the Facility or the Site Interest or any material
portion thereof is, or the rights in the Easements are, requisitioned.
LEASE EVENTS OF DEFAULT
Lease Events of Default under each Lease include, among other things:
(i) failure by the Company to pay basic rent, stipulated loss value,
termination value or certain indemnities to the related Owner Participants
within 5 days after the same becomes due; (ii) failure by the Company to pay
any other rent within 20 business days after receipt by the Company of written
notice from the Owner Trustee; (iii) failure by the Company to perform or
observe in any material respect any other covenant, condition or agreement in
such Lease or in any related document for 30 days after written notice by the
Owner Trustee or the Indenture Trustee requiring that the same be cured, unless
(a) such failure is curable but cannot be cured within 30 days, and (b) the
Company is diligently pursuing the cure of such failure (provided that, unless
the Company exercises its purchase option in accordance with the following
paragraph, such failure must be cured within 365 days, except that certain
failures which would materially reduce the value of the Facility or expose the
related Owner Participants or the Owner Trustee to recourse liability, must be
cured within 90 days); (iv) certain material misrepresentations by the Company
which remain uncured for 30 days following receipt of written notice from Owner
Trustee (unless the Company is trying to cure and actually cures within 180
days from notice); (v) certain bankruptcy and insolvency events shall occur
with respect to the Company; (vi) declaration of an event of default under any
lease of equipment or real property which had a cost to the Owner Trustee
exceeding $80,000,000 and having a term of not less than 15 years to which the
Company is a party, as lessee; (vii) termination of the Ground Lease and
Easement; or (viii) failure by the Company to maintain certain requisite
insurance within five Business Days after notice from the related Owner
Trustee. (Lease, Section 16)
Under each Lease, an event which, after the giving of notice or lapse
of time, or both, would become a Lease Event of Default is a lease default (a
"Lease Default"). With respect to each Lease, if (i) the Company is diligently
pursuing the cure of a Lease Default which has remained unremedied for a period
of at least (x) 270 days, in the case of Lease Defaults described in clause
(iii) of the preceding paragraph (70 days, if the applicable cure period is 90
days), or (y) 100 days in the case of a Lease Default described in clause (iv)
of the preceding paragraph, (ii) the Company does not reasonably believe that
such Lease Default can be cured within the applicable cure period, and (iii)
the Company has demonstrated to the reasonable satisfaction of the Owner
Participant its inability to cure such Lease Default within such applicable
cure period, the Company shall have the right to purchase the undivided
interest ownership at the end of the applicable cure period following the
occurrence of such Lease Default. On the first Business Day following such
applicable cure period, the Company shall pay to the Owner Trustee the higher
of the then fair market value of the Facility or the stipulated loss value.
If a Lease Event of Default shall have occurred and be continuing, and
the Owner Trustee has declared the Lease to be in default, the Owner Trustee
may exercise one or more of the remedies provided in the Lease with respect to
its undivided ownership interest in the Facility. These remedies include the
right to repossess and use such interest, to sell such interest free and clear
of the rights of the Company and to retain the proceeds of such sale and to
require the Company to pay as liquidated damages any unpaid basic rent due
under such Lease through the payment date, specified in a written notice to the
Company given at least ten days before such date plus whichever of the
following amounts the Owner Trustee shall select, with interest on such
amounts:
-43-
<PAGE> 45
(i) an amount equal to the excess, if any, of (A) the stipulated
loss value as of such payment date, over (B) the aggregate fair market
rental value of the Owner Trustee's undivided ownership interest in
the Facility until the end of the basic term or the then current
renewal term of the Lease, after discounting such rental value to
present worth at the discount rate specified in the Lease;
(ii) an amount equal to the excess, if any, of the stipulated
loss value as of such payment date, over the fair market value of the
Owner Trustee's undivided ownership interest in the Facility;
(iii) an amount equal to the highest of (A) such stipulated loss
value, (B) such discounted fair market rental value and (C) such fair
market value, and, upon full payment by the Company of all sums due
under the Lease, the Owner Trustee shall, at its option, either (x)
exercise its reasonable best efforts promptly to sell its undivided
ownership interest in the Facility and its interest under the Facility
Agreements and other Transaction Documents and pay over to the Company
the net proceeds of such sale (after deducting all reasonable costs
and expenses) up to the amount set forth in clause (A), (B) or (C)
above actually paid by the Company or (y) transfer its undivided
ownership interest in the Facility to the Company and terminate its
interest in the Facility Agreements and other Transaction Documents,
whereupon the Lease shall terminate; or
(iv) an amount equal to the excess of (A) the aggregate present
worth of all installments of basic rent as of such payment date to the
end of the basic term, discounted at the rate specified in the Lease
over (B) the present worth of the aggregate fair market rental value
of the Owner Trustee's undivided ownership interest in the Facility
for the remainder of such basic term, discounted at the rate specified
in the Lease. (Lease, Section 17)
MERGER; CONSOLIDATION; MAINTENANCE OF CORPORATE EXISTENCE
Pursuant to the Participation Agreements, the Company has agreed that
it will at all times maintain its existence as a corporation. The Company may
consolidate with or merge into, or sell all or substantially all of its assets
to, any person, so long as, (i) after giving effect thereto, no Lease Event of
Default shall have occurred and be continuing, (ii) no Payment Default or
Bankruptcy Default shall have occurred and be continuing, (iii) in the case of
any transaction among affiliates of the Company, after giving effect to such
transaction, the successor corporation shall (a) own all of the gold reserves
and resources, and the related mining equipment, theretofore owned by the
Company, and (b) have no material increase in liabilities in relation to the
liabilities of the Company immediately prior thereto, (iv) in the case of any
transaction other than one among affiliates of the Company, after giving effect
thereto, the successor corporation shall have a tangible net worth equal to or
in excess of the tangible net worth of the Company immediately prior thereto,
and (v) in the case of a sale of assets, the purchaser shall have assumed the
payment and performance obligations of the Company under the Lease and the
other transaction documents. Any such transaction herein described shall be
consummated in accordance with documents, and on the basis of legal opinions,
which are, in both cases, in form and scope satisfactory to the Owner
Participant, the Owner Trustee and the Indenture Trustee. (Participation
Agreement, Sections 10(b)(iii) and 10(b)(iv))
DESCRIPTION OF OTHER FACILITY DOCUMENTS
The statements under this caption are summaries and do not purport to
be complete. The summaries are qualified in their entirety by reference to the
Ground Lease and Easement and the Assignment of Contracts, copies of the form
of which have been filed as exhibits to the Registration Statement.
-44-
<PAGE> 46
GROUND LEASE AND EASEMENT
Pursuant to the Ground Lease and Easement, the Company will lease to
the Owner Trustees, as tenants in common, the land on which the Facility is
located (the "Site Interest") and accept a grant from the Company of an
easement relating to the adjacent Company premises for a fixed term of 32
years. Pursuant to the Ground Lease and Easement, the Company will retain
certain rights with respect to the adjacent premises and the convey or plot.
The Site Interest will be subleased back to the Company under the Leases.
ASSIGNMENT OF CONTRACTS
Pursuant to two separate and identical Assignments of Contracts
between the Company and each Owner Trustee, the Company assigns to such Owner
Trustee, to the extent of its undivided ownership interest, as security for the
payment of rent under each Lease and any other obligations owed by the
Company under the transaction documents, all of the Company's right, title and
interest with respect to certain specified construction contracts and an oxygen
supply agreement. So long as there is no Event of Default or Bankruptcy
Default, the Company will retain all of its rights under such contracts. Each
Assignment of Contracts expressly recognizes that it will be assigned to the
Indenture Trustee, as collateral for the payment of the Owner Trustee's
obligations under each Lessor Note.
CERTAIN FEDERAL INCOME TAX CONSIDERATIONS
The following is a general discussion of the anticipated material
federal income tax consequences of the purchase, ownership and disposition of
Pass Through Certificates. This summary is based on the Internal Revenue Code
of 1986, as amended (the "Code"), Treasury regulations promulgated thereunder,
rulings and decisions, all as in effect on the date of this Registration
Statement, and all of which are subject to change by legislative,
administrative or judicial action, possibly with retroactive effect. The
statements of law and legal conclusions contained herein are based on the
opinion of White & Case, counsel to the Company. The discussion below does not
purport to address federal income tax consequences applicable to particular
categories of investors, some of which (for example, banks, tax exempt
organizations, insurance companies or foreign investors) may be subject to
special rules. Investors should consult their own tax advisors in determining
the federal, state, local and foreign tax consequences to them of the purchase,
ownership and disposition of Pass Through Certificates, including the
advisability of making any election discussed below. The Pass Through Trust is
not indemnified for any federal, state or local income taxes that may be
imposed upon it, the imposition of which could reduce the amounts available for
distribution to the Certificate Owners of the Pass Through Trust.
GENERAL
Based upon an interpretation of analogous authorities under currently
applicable law, the Pass Through Trust, if operated in accordance with the Pass
Through Agreement, should not be classified as an association taxable as a
corporation, but rather should be classified as a grantor trust for purposes of
Sections 671 through 679 of the Code, and each Certificate Owner of the Pass
Through Trust should be treated as owning a pro rata undivided interest in each
Lessor Note and any other property held in the Pass Through Trust.
Accordingly, each Certificate Owner should report on its federal
income tax return its pro rata share of the entire income from the Lessor Notes
and any other property in the Pass Through Trust, in accordance with such
Certificate Owner's method of accounting. Subject to the rules on Original
Issue Discount, a Certificate Owner using the cash method of accounting should
take into account its pro rata share of income as and when received by the Pass
Through Trustee. A Certificate Owner using an accrual method of accounting
should take into account its pro rata share of income as such income is accrued
or is received by the Pass Through Trustee, whichever is earlier.
-45-
<PAGE> 47
A purchaser of a Pass Through Certificate should be treated as
purchasing an interest in each Lessor Note and any other property in the Pass
Through Trust at a price determined by allocating the purchase price paid for
the Pass Through Certificate among the related Lessor Notes and other property
in proportion to their fair market values at the time of purchase of the Pass
Through Certificate. When the Pass Through Trust has acquired all the related
Lessor Notes, the purchase price paid for a Pass Through Certificate by an
original purchaser of such certificate should be allocated among the Lessor
Notes in such Pass Through Trust in proportion to their respective principal
amounts.
If the Pass Through Trust were treated as an association taxable as a
corporation and if the income of the Pass Through Trust were not offset each
year by its deductions, then the Pass Through Trust would be required to pay
federal and state income taxes which would reduce amounts available to pay
amounts due to Certificate Owners. As noted above, White & Case, counsel to
the Company, is rendering its opinion that the Pass Through Trust should not be
classified as an association taxable as a corporation, but rather should be
classified as a grantor trust for federal income tax purposes. Therefore, the
following discussion of federal income tax consequences is based upon the
assumption that the Pass Through Trust is treated as a grantor trust, and not
as an association taxable as a corporation.
SALES OF PASS THROUGH CERTIFICATES
A Certificate Owner that sells or exchanges a Pass Through Certificate
should be considered as having sold its pro rata portion of the Lessor Notes
held by the Pass Through Trust and should recognize gain or loss (in the
aggregate) equal to the difference between its adjusted tax basis in its pro
rata portion of the Lessor Notes held by the Pass Through Trust and the amount
realized (except to the extent attributable to accrued interest, which should
be taxable as interest income to the extent not previously included in income).
Subject to the market discount provisions of the Code (described below), if the
Certificate Owner's pro rata portion of the Lessor Notes held by the Pass
Through Trust is considered to be a capital asset, any such gain or loss will
be capital gain or loss, which will be long-term capital gain or loss if the
Pass Through Certificate was held for more than one year (but only to the
extent the Pass Through Trust also held the underlying Lessor Notes for more
than one year). Any long-term capital gains will be taxable under current law
at the applicable marginal rate for capital gains. Any capital losses realized
generally will be deductible by a corporate taxpayer only to the extent of
capital gains and by an individual taxpayer only to the extent of capital gains
plus $3,000 of other income.
PREPAYMENT OF LESSOR NOTES
If a Lessor Note held by the Pass Through Trust is prepaid, each
Certificate Owner will be considered to have sold its pro rata portion of that
Lessor Note, and will recognize gain or loss equal to the difference between
its aggregate adjusted basis in the Lessor Note and the amount realized on the
sale (except to the extent attributable to accrued interest, which would be
taxable as interest income to the extent not previously included in income).
MARKET DISCOUNT
Generally, the term "market discount" means the excess of the
remaining principal amount of a Certificate Owner's pro rata portion of a
Lessor Note over the Certificate Owner's tax basis allocable to such Lessor
Note immediately after its acquisition, subject to a de minimis exception.
A Certificate Owner who acquires its pro rata portion of a Lessor Note
at a market discount will be required to treat any gain realized on the
disposition of such Lessor Note, except in certain nonrecognition transactions,
as ordinary income to the extent of the market discount that accrued during the
period that such holder held its pro rata portion of such Lessor Note.
Further, a disposition of a Pass Through Certificate by gift (and in certain
other circumstances) could result in the recognition of market discount income,
computed as if the Certificate Owner's pro rata portion of the Lessor Note had
been sold for its fair market value.
-46-
<PAGE> 48
In the case of a principal payment on indebtedness subject to the
market discount rules, Section 1276 of the Code requires that such payment be
included in gross income as ordinary income to the extent of the market
discount that has accrued during the period such indebtedness was held. The
amount of any accrued market discount later required to be included in income
upon a disposition, or subsequent partial principal payment, will be reduced by
the amount of accrued market discount previously included in income.
The explanatory Conference Committee Report to the Tax Reform Act of
1986 (the "Conference Report") indicates that, until Treasury regulations are
promulgated requiring a different treatment, holders of installment
obligations (such as the Lessor Notes) with market discount may elect to accrue
market discount either on the basis of a constant interest rate or as follows:
the amount of market discount that is deemed to accrue is the amount of market
discount that bears the same ratio to the total amount of remaining market
discount that the amount of stated interest paid in the accrual period bears to
the total amount of stated interest remaining to be paid on the installment
obligation as of the beginning of such period.
Under Section 1277 of the Code, if in any taxable year interest paid
or accrued on indebtedness incurred or continued to purchase or carry
indebtedness subject to the market discount rules exceeds the interest
currently includible in income with respect to such indebtedness, deduction of
the excess interest must be deferred to the extent of the market discount
allocable to the taxable year. The deferred portion of any interest expense
will generally be deductible when such market discount is included in income
upon the sale or other disposition (including repayment) of the indebtedness.
A Certificate Owner who acquires its pro rata portion of a Lessor Note
at a market discount may elect under Section 1278 of the Code, in the manner
provided by Revenue Procedure 92-67, 1992-2 C.B. 429, to include such discount
in income as it accrues. The current inclusion election applies to all market
discount obligations acquired on or after the first day to which the election
applies, and may not be revoked without the consent of the Internal Revenue
Service (the "IRS"). If a Certificate Owner elects to include market discount
in income as it accrues, the rules of Sections 1276 and 1277 of the Code with
respect to the recognition of ordinary income on a sale or other disposition of
such Certificate and the deferral of interest deductions on indebtedness
related to such Lessor Note would not apply.
The IRS is authorized to issue regulations to implement the market
discount provisions of the Code. No such regulations have been issued or
proposed. It is impossible to anticipate what effect, if any, such regulations
could have on the Certificate Owner.
AMORTIZABLE BOND PREMIUM
A Certificate Owner should generally be considered to have acquired an
interest in Lessor Notes at a premium to the extent the purchaser's tax basis
allocable to such interest exceeds the remaining principal amount of the Lessor
Notes allocable to such interest. In that event, a Certificate Owner who holds
its pro rata portion of a Lessor Note as a capital asset may elect to amortize
that premium as an offset to interest income under Section 171 of the Code with
corresponding reductions in the Certificate Owner's tax basis in its pro rata
portion of a Lessor Note. In the case of installment obligations (such as the
Lessor Notes), the Conference Report indicates a Congressional intent that
amortization will be in accordance with the same rules that will apply to the
accrual of market discount on installment obligations (see discussion above).
Under certain circumstances, amortizable bond premium may be
determined by reference to an early call date. It is unclear how the
amortizable bond premium rules apply where, as in the case with the Lessor
Notes, the amount of redemption premium payable on an early call date is
unknown. In addition, the treatment of any unamortized bond premium remaining
at the time of an early call is unclear. The Certificate Owner are urged to
consult their own tax advisors as to the treatment of any amortizable bond
premiums.
-47-
<PAGE> 49
TREATMENT OF CERTAIN FOREIGN CERTIFICATE OWNERS
Interest paid or accrued with respect to a Pass Through Certificate
held by a Certificate Owner that is a nonresident alien individual, foreign
corporation, or other non-United States person (a "Foreign Person") will
generally be treated as "portfolio interest" and, therefore, will not be
subject to any United States income tax, provided that (i) such interest is not
effectively connected with a trade or business in the United States of the
Certificate Owner, (ii) such Foreign Person does not directly or indirectly own
10% or more of the total combined voting power of all classes of stock of
Newmont entitled to vote, (iii) such Foreign Person is not a controlled foreign
corporation that is related to Newmont by stock ownership, (iv) such Foreign
Person is not a bank which acquired Pass Through Certificates in consideration
of an extension of credit made pursuant to a loan agreement entered into in the
ordinary course of business, and (v) the Pass Through Trustee (or other person
that otherwise would be required to withhold tax) is provided with appropriate
certification that the beneficial owner of the Certificate is a Foreign Person
("Foreign Person Certification"). If Foreign Person Certification is not
provided, interest paid with respect to a certificate could be subject to a 30%
withholding tax or 31% backup withholding (described below).
BACKUP WITHHOLDING
Payments made on the Pass Through Certificates and proceeds from the
sale of the Pass Through Certificates to or through certain brokers may be
subject to a "backup" withholding tax of 31% unless the Certificate Owner
complies with certain reporting procedures or is an exempt recipient under
Section 6049(b)(4) of the Code. Any such withheld amounts will be allowed as a
credit against the Certificate Owner's federal income tax.
CERTAIN ILLINOIS TAXES
The Pass Through Trustee is a national banking association with its
corporate trust office in Chicago, Illinois. Winston & Strawn, special
Illinois tax counsel to the Trustee, is of the opinion, under existing law and
assuming that, for federal income tax purposes, the Pass Through Trusts will
not be classified as associations taxable as corporations or as partnerships
for federal income tax purposes but will instead be properly classified as
grantor trusts under Subpart E, Part I of Subchapter J of the Code (See
"Certain Federal Income Tax Considerations" above), that (i) the Pass Through
Trusts will not be subject to any tax (including, without limitation, net or
gross income, tangible or intangible property, net worth, capital, franchise or
doing business tax), [governmental fee or other governmental charge (assuming
that any and all expenses, including filing and other fees, in connection with
the qualification of the Pass Through Certificates for offer and sale under the
securities or Blue Sky of the State of Illinois will be the responsibility of
and paid for by the Company)] under the laws of the State of Illinois, the
County of Cook or the City of Chicago, and (ii) the Certificate Owners who are
not residents of the State of Illinois and who are not otherwise subject to tax
in the State of Illinois will not be subject to any tax (including, without
limitation, net or gross income, tangible or intangible property, net worth,
capital, franchise or doing business tax), [governmental fees or other
governmental charges] under the laws of the State of Illinois, the County of
Cook or the city of Chicago as a result of purchasing, holding (including
receiving payments with respect to) or selling a Pass Through Certificate.
Neither the Pass Through Trusts nor the Certificate Owners will be
indemnified for any state or local taxes imposed on them, and the imposition of
any such taxes on the Pass Through Trusts could result in a reduction in the
amounts available for distribution to the Certificate Owners. In general,
should a Certificate Owner or the Pass Through Trusts be subject to any state
or local tax which would not be imposed if the Pass Through Trustee were
located in a different jurisdiction in the United States, the Pass Through
Trustee will resign and a new Pass Through Trustee in such other jurisdiction
will be appointed.
-48-
<PAGE> 50
CERTAIN ERISA CONSIDERATIONS
No "employee benefit plan" subject to Part 4 of Subtitle B of Title I
of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
or "plan," subject to Section 4975 of the Internal Revenue Code of 1986, as
amended (the "Code"), or any trust created under any such employee benefit plan
or plan, or any "governmental plan," as defined in Section 3(32) of ERISA or
Section 414(d) of the Code, organized in a jurisdiction having prohibitions on
transactions with such governmental plan similar to those contained in Section
406 of ERISA or Section 4975 of the Code (hereinafter such employee benefit
plan, plan and governmental plan are collectively referred to as an "ERISA
Plan"), or a person treated as holding the assets of an ERISA Plan, may acquire
or hold any Pass Through Certificates. No part of the funds used by any Person
to acquire or hold any Pass Through Certificates may constitute assets (within
the meaning of ERISA and any applicable rules and regulations) of an ERISA
Plan.
Furthermore, the acquisition or holding by any Person of any Pass
Through Certificates will be deemed to constitute a representation by such
Person to the Company, the Owner Participants, the Owner Trustee, the Indenture
Trustee and the Pass Through Trustee that such Person is not an ERISA Plan and
that such Person is not acquiring or holding, and has not acquired or held,
such Pass Through Certificates with the assets of an ERISA Plan.
UNDERWRITING
Under the terms of and subject to the conditions contained in an
Underwriting Agreement dated the date hereof (the "Underwriting Agreement")
among the Company, Salomon Brothers Inc, Chemical Securities Inc., CS First
Boston Corporation and Lazard Freres & Co. (the "Underwriters"), the Company
has agreed to cause each Pass Through Trustee to sell to each of the
Underwriters, and each of such Underwriters has severally agreed to purchase
the respective aggregate amounts of Pass Through Certificates set forth after
their names below.
The Underwriting Agreement provides that the obligation of the
Underwriters to pay for and accept delivery of the Pass Through Certificates is
subject to, among other things, the approval of certain legal matters by its
counsel and certain other conditions. The Underwriters are obligated to take
and pay for all of the Pass Through Certificates to be purchased if any are
taken.
<TABLE>
<CAPTION>
UNDERWRITER TOTAL AGGREGATE AMOUNT OF
-----------
PASS THROUGH CERTIFICATES
-------------------------
<S> <C>
Salomon Brothers Inc . . . . . . . . . . . . . . . $
Chemical Securities Inc. . . . . . . . . . . . . .
CS First Boston Corporation . . . . . . . . . . . .
Lazard Freres & Co. . . . . . . . . . . . . . . .
---------------------
Total . . . . . . . . . . . . . . . . . . $
=====================
</TABLE>
In the event of a default by any Underwriter, the Underwriting
Agreement provides that, in certain circumstances, purchase commitments of
non-defaulting Underwriters may be increased or the Underwriting Agreement may
be terminated.
The Underwriters propose to offer all or part of the Pass Through
Certificates directly to the public at the public offering prices per Pass
Through Certificate set forth on the cover page of this Prospectus and may
offer a portion of the Pass Through Certificates to dealers at a price which
represents a concession not in excess of the amounts set forth below. The
Underwriters may allow, and such dealers may reallow, concessions not in excess
of the amounts set forth below to certain other dealers. After the initial
public offering, the public offering prices and such concessions may be
changed.
-49-
<PAGE> 51
<TABLE>
<CAPTION>
PASS THROUGH CONCESSIONS REALLOWANCE
CERTIFICATE TO DEALERS CONCESSION
------------ ----------- -----------
<S> <C> <C>
1994-A1 . . . . . . . . . . . . . . . . . . . . . . % %
1994-A2 . . . . . . . . . . . . . . . . . . . . . . % %
</TABLE>
The Company has agreed to indemnify the Underwriters and the
Underwriters have agreed to indemnify the Company against certain liabilities,
including liabilities under the Securities Act.
The Company does not intend to apply for listing of the Pass Through
Certificates on a national securities exchange, but has been advised by the
Underwriters that the Underwriters presently intend to make a market in the
Pass Through Certificates, as permitted by applicable laws and regulations.
The Underwriters are not obligated, however, to make a market in the Pass
Through Certificates and any such market making may be discontinued at any time
at the sole discretion of the Underwriters. Accordingly, no assurance can be
given as to the liquidity of, or trading markets for, the Pass Through
Certificates.
Each of the Underwriters, or their respective affiliates, performs
investment banking and other financing services for the Company in the ordinary
course of business. Chemical Securities Inc. is an affiliate of Chemical Bank
which is a lender to the Company.
LEGAL OPINIONS
Certain legal matters in connection with the offering will be passed
upon for the Company by White & Case and for the Underwriters by Davis Polk &
Wardwell.
EXPERTS
The audited consolidated financial statements and schedules
incorporated by reference in this Prospectus have been audited by Arthur
Andersen & Co., independent public accountants, as indicated in their reports
with respect thereto, and are incorporated by reference herein in reliance upon
the authority of said firm as experts in auditing and accounting in giving said
reports.
-50-
<PAGE> 52
APPENDIX I
GLOSSARY OF DEFINED TERMS
"1994-A1 Trust" shall mean the Newmont Gold Company 1994-A1 Pass
Through Trust to be formed pursuant to the Pass Through Agreement.
"1994-A2 Trust" shall mean the Newmont Gold Company 1994-A2 Pass
Through Trust to be formed pursuant to the Pass Through Agreement.
"Bankruptcy Default" shall mean the pendency of certain bankruptcy
proceedings with respect to the Company.
"Basic Rent or Basic Rent Payment" shall mean, with respect to either
Lease, an amount equal to the periodic rent payments required on each Rent
Payment Date which must be not less than the Scheduled Payments then due on the
related Lessor Notes.
"Business Day" shall mean any day other than a Saturday or Sunday or
other day on which banks in New York, New York, Chicago, Illinois or Hartford,
Connecticut are authorized to remain closed.
"Carlin Complex" shall mean and include the Facility and any asset or
facility of the Company located in the immediate vicinity of Carlin, Nevada.
"Cede" shall mean Cede & Co., DTC's nominee for the permanent global
certificates.
"Certificate Account" shall mean any of the non-interest bearing
accounts for the deposit of Scheduled Payments on the Lessor Notes held in the
Pass Through Trust.
"Certificate Owner" shall mean a person having a beneficial interest
in a Pass Through Certificate.
"Certificateholder" shall mean the name in which a Pass Through
Certificate is registered.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and
any regulations promulgated pursuant to the Code.
"Commission" shall mean the United States Securities and Exchange
Commission.
"Components" shall mean appliances, parts, instruments, appurtenances,
accessories, furnishings, equipment and other property of whatever nature that
may from time to time be incorporated in the Facility.
"The Company" shall mean Newmont Gold Company, a Delaware corporation.
"DTC" shall mean the Depository Trust Company.
"Early Buy-Out Date" shall mean January 5, 2012.
"Early Buy-Out Price" shall mean an amount, payable under any Lease in
installments commencing on the Early Buy-Out Date, the payment to be made on
the Early Buy-Out Date being equal to a predetermined percentage of Facility
Cost but not less than redemption price of the related Lessor Notes on such
date.
<PAGE> 53
APPENDIX I
Page 2
"Early Purchase Option" shall mean the Company's right to purchase an
Owner Trustee's interest in the Facility under the Lease as described above
under "Description of the Leases - Purchase Option."
"Easement" shall mean the easement relating to the adjacent Company
premises granted by the Company to the Owner Trustee under and pursuant to the
Ground Lease and Easement.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended, or any comparable successor law.
"ERISA Plan" shall mean any "employee benefit plan" subject to Part 4
of Subtitle B of Title I of ERISA, or "plan" subject to Section 4975 of the
Code, any trust created under any such employee benefit plan or plan, or
"governmental plan" as defined in Section 3(32) of ERISA or Section 414(d) of
the Code organized in a jurisdiction having prohibitions on transactions with
such governmental plan similar to those contained in Section 406 of ERISA or
Section 4975 of the Code.
"Event of Default" shall mean the occurrence and continuance of any
Lease Event of Default or Indenture Event of Default.
"Event of Loss" shall mean any of the events described above under
"Description of the Lease - Events of Loss."
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Facility" shall mean the refractory gold ore treatment facility
located approximately six miles north of Carlin, Nevada.
"Facility Agreements" shall mean the Support Agreement, the Assignment
of Contracts, the Ground Lease and Easement and any other agreement, permit or
license or Governmental Action to which the Company is a party and which are
necessary for the operation of the Facility.
"Facility Cost" shall mean the Owner Trustee's share of the cost of
the Facility.
"Facility Site" shall mean the Site Interest and the adjacent premises.
"Financing Lease" shall mean any lease of equipment and/or real
property which has a cost to the lessor in excess of $80,000,000 under which
the Company is a lessee and which had a term of not less than 15 years from the
inception thereof.
"First Chicago" or "FNCB" shall mean The First National Bank of
Chicago, a national banking association, in its individual capacity unless the
context requires otherwise.
"Foreign Person" shall mean any Certificate Owner who is a nonresident
alien individual, foreign corporation, or other non-United States person.
"GAAP" shall mean generally accepted accounting principles in the
United States as in effect from time to time.
"Ground Lease and Easement" shall mean the Ground Lease and Easement,
pursuant to which the Owner Trustees will, subject to the conditions set forth
therein, lease from the Company the Site Interest and accept a grant by the
Company of the Easement.
"Holders" shall mean the holders of the Lessor Notes.
<PAGE> 54
APPENDIX I
Page 3
"Indenture" shall mean either of the Trust Indenture and Security
Agreement to be dated as of July 15, 1994, between an Owner Trustee and an
Indenture Trustee.
"Indenture Default" shall mean an event which, after giving of notice
or lapse of time, or both, would become an Indenture Event of Default.
"Indenture Event of Default" shall mean any of the events specified in
the Indenture and described above under "Description of the Indentures -
Indenture Events of Default."
"Indenture Trustee" shall mean The First National Bank of Chicago, a
national banking association, not in its individual capacity, but solely as
Indenture Trustee under each Indenture, and each successor as Indenture Trustee
under each Indenture.
"Lease" shall mean either Lease, to be dated the Closing Date between
the Company and an Owner Trustee.
"Lease Default" shall mean an event which, after notice or lapse of
time, or both, would become a Lease Event of Default.
"Lease Event of Default" shall be any Event of Default in a Lease as
described above under "Description of the Leases - Lease Events of Default."
"Lessee" shall mean the Company.
"Lessor" shall mean each Owner Trustee.
"Lessor Notes" shall mean the Notes issued or to be issued by the
Owner Trustees pursuant to the Indentures and authorized by the Indenture
Trustees.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind, including, without limitation, any
conditional sale or other title retention agreement, any lease in the nature
thereof or the filing of, or agreement to give, any financing statement under
the Uniform Commercial Code of any jurisdiction.
"Majority in Interest of the Holders of Lessor Notes" shall mean a
66-2/3% majority of the Holders.
"Make-Whole Premium" shall have the meaning as described above under
"Description of the Indentures -- Prepayment."
"NEL" shall mean Newmont Exploration Limited, the Company's subsidiary.
"NMC" shall mean Newmont Mining Corporation, a Delaware corporation,
which is the Company's parent.
"NMC Preferred Stock" shall mean the convertible preferred stock
issued by NMC.
"Owner Participant" shall mean an institutional investor.
"Owner Trust" shall mean the trust to be formed pursuant to each Trust
Agreement.
"Owner Trustee" shall mean Shawmut Bank Connecticut, National
Association, a national banking association, not in its individual capacity,
but solely as Owner Trustee.
<PAGE> 55
APPENDIX I
Page 4
"Participation Agreement" shall mean each Participation Agreement
among Shawmut Bank Connecticut, National Association, in its individual
capacity and as Owner Trustee, the Indenture Trustee, one or more Owner
Participants, The First National Bank of Chicago, the Pass Through Trustee and
the Company.
"Pass Through Certificates" shall mean each of the Certificates,
Series 1994-A1 and Series 1994-A2 issued by First National Bank of Chicago
pursuant to the Pass Through Agreement.
"Pass Through Trust" shall mean each of the Newmont Gold Company
Series 1994-A1 Pass Through Trust and the Newmont Gold Company 1994-A2 Pass
Through Trust to be formed pursuant to the Pass Through Agreement.
"Pass Through Agreement" shall mean each pass through trust agreement
between the Company and the Pass Through Trustee.
"Pass Through Permitted Investments" shall mean non-callable direct
obligations of the United States of America maturing on or prior to the day
required for the distribution of any such funds on a Special Distribution Date.
"Pass Through Trustee" shall mean The First National Bank of Chicago,
a national banking association, not in its individual capacity, but solely as
Pass Through Trustee under the Pass Through Agreements and each successor Pass
Through Trustee under such Pass Through Agreements.
"Payment Default" shall mean a failure by the Company to make Rent
payments under the Lease.
"Permitted Investments" shall mean (i) obligations of the United
States of America, or fully guaranteed as to interest and principal by the
United States of America, maturing in not more than one year, (ii) certificates
of deposit having a final maturity of not more than 30 days after the date of
issuance thereof of any commercial bank incorporated under the laws of the
United States of America or any state thereof or the District of Columbia which
bank is a member of the Federal Reserve System and has a combined capital and
surplus of not less the $300,000,000 and (iii) commercial paper, rated P-1 by
Moody's Investors Services, Inc., or A-1 by Standard and Poor's Corporation,
having a remaining term until maturity of not more than 90 days, other than any
such obligation, certificate of deposit or commercial paper issued by the Owner
Trustee, the Indenture Trustee or any institution which shall become a
successor Owner Trustee or Indenture Trustee; provided, however, that no such
investment made while there has occurred and is continuing an Indenture Default
or an Indenture Event of Default is a Permitted Investment if it has a maturity
in excess of 30 days.
"Pool Balance" shall mean, for each Pass through Trust, as of any
date, the aggregate unpaid principal amount of the Lessor Notes held in such
Pass Through Trust on such date plus any amounts in respect of principal on
such Lessor Notes held by the Pass Through Trustee and not yet distributed. The
Pool Balance for each Pass Through Trust as of any Regular Distribution Date or
Special Distribution Date shall be computed after giving effect to the payment
of principal, if any, on the Lessor Notes held in such Pass Through Trust and
distribution thereof to be made on that date.
"Pool Factor" shall mean for each Pass Through Trust, as of any date,
the quotient (rounded to the seventh decimal point) computed by dividing (i)
the Pool Balance by (ii) the aggregate amount of the Lessor Notes held in the
Pass Trough Trust. The Pool Factor for each Pass Through Trust as of any
Regular Distribution Date or Special Distribution Date shall be computed after
giving effect to the payment of principal of, if any, on the Lessor Notes held
in the Pass Through Trust and distribution thereof to be made on that date.
<PAGE> 56
APPENDIX I
Page 5
"Purchase Documents" shall mean such documents as either Owner Trustee
shall deem desirable to convey to it good and marketable title of its undivided
ownership interest from the Company.
"Regulations" shall mean the income tax regulations promulgated under
the Code.
"Regular Distribution Date" shall mean January 5 and July 5,
commencing on July 5, 1995, until all of the Scheduled Payments to be made
under the Lessor Notes have been made.
"Rent" shall mean Basic Rent and Supplemental Rent, collectively.
"Rent Payment Dates" shall mean and include each January 5 and July 5
of each year, commencing July 5, 1995.
"SEC" shall mean the United States Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Scheduled Payment" shall mean each payment of interest, Make-Whole
Premium, if any, and principal on a Lessor Note to be received by the Pass
Through Trustee in accordance with the principal repayment schedule set forth
in "Description of the Indentures -- Scheduled Payments."
"Shawmut" shall mean Shawmut Bank Connecticut, National Association, a
national banking association, in its individual capacity.
"Site Interest" shall mean the land on which the Facility is located.
"Special Distribution Date" shall mean the Business Day on which a
special payment is due.
"Special Payment" shall mean any payments received (i) for the
prepayment of Lessor Notes in connection with certain events specified in this
Prospectus, (ii) upon the prepayment by the related Owner Trustee of the Lessor
Notes following a default in respect of such Lessor Notes, and (iii) on account
of the sale of the Lessor Notes by the Pass Through Trustee.
"Special Payment Account" shall mean any of the accounts which will,
except on connection with Pass Through Permitted Investments, be non-interest
bearing accounts for the deposit of Special Payments on Lessor Notes held in
the Pass through Trust.
"Supplemental Financing" is a financing by an Owner Trustee of the
cost of certain modifications to the Facility as described above under
"Description of the Indentures - Supplemental Financing Notes."
"Supplemental Financing Notes" shall mean those Notes issued in
conjunction with a Supplemental Financing.
"Supplemental Rent" shall mean certain indemnity and other payment
obligations of the Company to the Owner Trustees, the Owner Participants, the
Indenture Trustees, the Pass Through Trustees, or any holders of the Pass
Through Certificates in addition to Basic Rent which may be required in
connection with the leveraged lease financing described in this Prospectus.
"Termination Value" shall mean that value set forth opposite the
Termination Date in Schedule 5 to the Lease.
"Treasury Rate" shall have the meaning as described under the caption
"Description of the Indentures -- Prepayment."
<PAGE> 57
APPENDIX I
Page 6
"Trust Agreement" shall mean each trust agreement between the Owner
Participants and the Owner Trustee.
"Underwriters" shall mean Salomon Brothers Inc, Chemical Securities
Inc., CS First Boston Corporation and Lazard Freres & Co.
"Underwriting Agreement" shall mean the agreement between the Company
and the Underwriters relating to the offering and sale of the Pass Through
Certificates.
"Weighted Average Life to Maturity" shall have the meaning described
under the caption "Description of the Indentures -- Prepayment."
<PAGE> 58
<TABLE>
<S> <C>
No dealer, salesman or other person has been authorized to
give any information or to make any representations other
than those contained in this Prospectus in connection with
the offer made by this Prospectus, and, if given or made, $265,000,000
such information or representations must not be relied upon
as having been authorized by the Company or the
Underwriters. Neither the delivery of this Prospectus nor
any sale made hereunder shall under any circumstances
create an implication that there has been no change in the
affairs of the Company since the date hereof. This NEWMONT GOLD COMPANY
Prospectus does not constitute an offer or solicitation by 1994-A1 AND 1994-A2
anyone in any jurisdiction in which such offer or PASS THROUGH TRUSTS
solicitation is not authorized or in which the person
making such offer or solicitation is not qualified to do so
or to anyone to whom it is unlawful to make such offer or
solicitation.
PASS THROUGH CERTIFICATES,
----------------- SERIES 1994-A1 AND 1994-A2
TABLE OF CONTENTS
PAGE
----
Available Information . . . . . . . . . 4
Incorporation of Certain Documents
by Reference . . . . . . . . . . . . . 4
Reports to Certificateholders by the
Trustee . . . . . . . . . . . . . . . . 4
Prospectus Summary . . . . . . . . . . . 5
The Company . . . . . . . . . . . . . . . 12
Recent Developments . . . . . . . . . . . 13
Capitalization . . . . . . . . . . . . . 15
Selected Consolidated Financial Data . . 16 SALOMON BROTHERS INC
Ratio of Earnings to Fixed Charges . . . 18
Description of the Facility . . . . . . . 18 CHEMICAL SECURITIES INC.
Description of the Transaction . . . . . 19
Use of Proceeds . . . . . . . . . . . . . 19 CS FIRST BOSTON
Diagram of Payments . . . . . . . . . . . 20
Description of the Pass Through Certificates 21 LAZARD FRERES & CO.
Description of the Indentures . . . . . . 32
Description of the Leases . . . . . . . . 39
Description of Other Facility Documents . 44
Certain Federal Income Tax PROSPECTUS
Considerations . . . . . . . . . . . . 45
Certain Illinois Taxes . . . . . . . . . 48 DATED , 1994
Certain ERISA Considerations . . . . . . 49
Underwriting . . . . . . . . . . . . . . 49
Legal Opinions . . . . . . . . . . . . . 50
Experts . . . . . . . . . . . . . . . . . 50
Glossary of Defined Terms . . . . . . . . . Appendix 1
</TABLE>
<PAGE> 59
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.*
<TABLE>
<S> <C>
SEC filing fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 91,379.42
Accounting fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . **
Legal fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . **
Blue Sky and Legal Investment fees and
expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . **
Trustee's fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . **
Rating agency fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . **
Printing and engraving expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . **
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . **
--------------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ **
</TABLE>
- --------------------
*All estimates except for filing fee.
**To be furnished by amendment.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law authorizes and
empowers the Company to indemnify the directors, officers, employees and agents
of the Company against liabilities incurred in connection with, and related
expenses resulting from, any claim, action or suit brought against any such
person as a result of his relationship with the Company, provided that such
persons acted in good faith and in a manner such person reasonably believed to
be in, and not opposed to, the best interests of the Company in connection with
the acts or events on which such claim, action or suit is based. The finding
of either civil or criminal liability on the part of such persons in connection
with such acts or events is not necessarily determinative of the question of
whether such persons have met the required standard of conduct and are,
accordingly, entitled to be indemnified. The foregoing statements are subject
to the detailed provisions of Section 145 of the General Corporation Law of the
State of Delaware.
The By-Laws of the Company provide that the Company shall indemnify,
in all respects and to the full extent authorized or permitted by law, any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of his being or having
been a director, officer, employee or agent of the Company or, at the request
of the Company, of any other corporation, partnership, joint venture, trust or
other enterprise against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement reasonably incurred by such person in connection
with such action, suit or proceeding. Such indemnification of any person shall
inure to the benefit of his heirs, executors and administrators.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENTS
- ------- ------------------------
<S> <C>
Exhibit 1* Form of Underwriting Agreement relating to the Pass Through Certificates.
Exhibit 4.1** Form of Pass Through Agreement to be dated as of July 15, 1994 between the Company and The First National Bank of
Chicago.
Exhibit 4.2** Form of Pass Through Certificate (included in Exhibit 4.1).
</TABLE>
<PAGE> 60
<TABLE>
<S> <C>
Exhibit 4.3** Form of Participation Agreement to be dated as of July 15, 1994
relating to the leveraged lease transaction.
Exhibit 4.4** Form of Lease to be dated as of the Closing Date between the Company,
as Lessee, and Owner Trustee, as Lessor.
Exhibit 4.5** Form of Trust Indenture and Security Agreement to be dated as of
July 15, 1994 between Owner Trustee and The First
National Bank of Chicago.
Exhibit 4.6** Form of Lessor Note (included in Exhibit 4.5).
Exhibit 4.7* Form of Ground Lease and Easement between the Company and
Shawmut Bank Connecticut, National Association.
Exhibit 4.8** Form of Assignment of Contracts between the Company and Shawmut
Bank Connecticut, National Association.
Exhibit 5* Opinion of White & Case, counsel to the Company, as to the
legality of the Pass Through Certificates registered
hereunder.
Exhibit 8.1* Opinion of White & Case as special tax counsel to the Company.
Exhibit 8.2* Opinion of Winston & Strawn, counsel to the Pass Through Trustee,
concerning certain Illinois tax matters.
Exhibit 12 Computation of Ratio of Earnings to Fixed Charges (incorporated
by reference to Exhibit 12 to the Company's
Registration Statement on Form S-3 (No. 33-54245)).
Exhibit 23.1 Consent of Arthur Andersen & Co.
Exhibit 23.2* Consent of White & Case (included in Exhibit 5).
Exhibit 23.3* Consent of White & Case (included in Exhibit 8.1).
Exhibit 23.4* Consent of Winston & Strawn (included in Exhibit 8.2).
Exhibit 24 Powers of attorney.
Exhibit 25.1 Statement of Eligibility on Form T-1 of The First National Bank
of Chicago relating to the Pass Through Agreement for
the 1994-A1 Trust.
Exhibit 25.2 Statement of Eligibility of Form T-1 of The First National Bank
of Chicago relating to the Pass Through Agreement for
the 1994-A2 Trust.
</TABLE>
- ------------------------------
* To be filed by amendment.
** There will be two sets of this document, substantially similar in all
respects to this Exhibit, each pertaining to a separate undivided interest in
the Facility.
II-2
<PAGE> 61
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) that, for purposes of determining any liability under
the Act, each filing of the Registrant's annual report pursuant to
Section 13(a) or 15(d) of the Exchange Act that is incorporated by
reference in this registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof; and
(2) that, for purposes of determining any liability under
the Securities Act, the information omitted from the form of
prospectus filed as part of this registration statement in reliance
upon Rule 430A and contained in a form of prospectus, filed by the
Registrant pursuant to Rule 424(b)(1) or (4) under the Act shall be
deemed to be part of this registration statement as of the time it was
declared effective; and
(3) that, for the purpose of determining liability under
the Securities Act, each post-effective amendment that contains a form
of prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, the Company
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Company of expenses incurred or paid by a director,
officer or controlling person of the Company in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Company will, unless in the opinion of its counsel the matter has been settled
by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
II-3
<PAGE> 62
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS
AMENDED, THE REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE
THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY
CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF DENVER, STATE OF
COLORADO, ON THE 2ND DAY OF AUGUST, 1994.
NEWMONT GOLD COMPANY
By/s/ Timothy J. Schmitt
-------------------------------------
Timothy J. Schmitt
Vice President, Secretary and
Assistant General Counsel
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
* Director August 2, 1994
- -------------------------------
Rudolph I.J. Agnew
* Director August 2, 1994
- -------------------------------
J. P. Bolduc
* Vice Chairman, President and Chief Executive
- ------------------------------- Officer and Director (Principal Executive
Ronald C. Cambre Officer) August 2, 1994
* Director August 2, 1994
- -------------------------------
Joseph P. Flannery
* Director August 2, 1994
- -------------------------------
Thomas A. Holmes
* Chairman and Director August 2, 1994
- -------------------------------
Gordon R. Parker
* Director August 2, 1994
- -------------------------------
Robin A. Plumbridge
* Director August 2, 1994
- -------------------------------
Robert H. Quenon
* Director August 2, 1994
- -------------------------------
James V. Taranik
* Director August 2, 1994
- -------------------------------
William I.M. Turner, Jr.
</TABLE>
II-4
<PAGE> 63
<TABLE>
<S> <C> <C>
* Senior Vice President and Chief Financial
- ------------------------------- Officer (Principal Financial Officer)
Wayne W. Murdy August 2, 1994
* Vice President and Controller (Principal
- ------------------------------- Accounting Officer)
Gary E. Farmar August 2, 1994
*By /s/ Timothy J. Schmitt
----------------------------
Name: Timothy J. Schmitt as
Attorney-in-fact
</TABLE>
II-5
<PAGE> 64
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER PAGE
- ------- ----
<S> <C>
Exhibit 1* Form of Underwriting Agreement relating to the Pass Through Certificates.
Exhibit 4.1** Form of Pass Through Agreement to be dated as of July 15, 1994 between the Company and The First National
Bank of Chicago.
Exhibit 4.2** Form of Pass Through Certificate (included in Exhibit 4.1).
Exhibit 4.3** Form of Participation Agreement to be dated as of July 15, 1994 relating to the leveraged lease transaction.
Exhibit 4.4** Form of Lease to be dated as of the Closing Date between the Company, as Lessee, and Owner Trustee, as Lessor.
Exhibit 4.5** Form of Trust Indenture and Security Agreement to be dated as of July 15, 1994 between Owner Trustee and The
First National Bank of Chicago.
Exhibit 4.6** Form of Lessor Note (included in Exhibit 4.5).
Exhibit 4.7* Form of Ground Lease and Easement between the Company and Shawmut Bank Connecticut, National Association.
Exhibit 4.8** Form of Assignment of Contracts between the Company and Shawmut Bank Connecticut, National Association.
Exhibit 5* Opinion of White & Case, counsel to the Company, as to the legality of the Pass Through Certificates
registered hereunder.
Exhibit 8.1* Opinion of White & Case as special tax counsel to the Company.
Exhibit 8.2* Opinion of Winston & Strawn, counsel to the Pass Through Trustee, concerning certain Illinois tax matters.
Exhibit 12 Computation of Ratio of Earnings to Fixed Charges (incorporated by reference to Exhibit 12 to the Company's
Registration Statement on Form S-3 (No. 33-54245)).
Exhibit 23.1 Consent of Arthur Andersen & Co.
Exhibit 23.2* Consent of White & Case (included in Exhibit 5).
Exhibit 23.3* Consent of White & Case (included in Exhibit 8.1).
</TABLE>
<PAGE> 65
<TABLE>
<CAPTION>
EXHIBIT
NUMBER PAGE
- ------- ----
<S> <C>
Exhibit 23.4* Consent of Winston & Strawn (included in Exhibit 8.2).
Exhibit 24 Powers of attorney.
Exhibit 25.1 Statement of Eligibility on Form T-1 of The First National Bank of Chicago relating to the Pass Through
Agreement for the 1994-A1 Trust.
Exhibit 25.2 Statement of Eligibility of Form T-1 of The First National Bank of Chicago relating to the Pass Through
Agreement for the 1994-A2 Trust.
</TABLE>
- ------------------------------
* To be filed by amendment.
** There will be two sets of this document, substantially similar in all
respects to this Exhibit, each pertaining to a separate undivided interest in
the Facility.
<PAGE> 1
EXHIBIT 4.1
Davis Polk & Wardwell Draft of August 3, 1994
================================================================================
PASS THROUGH TRUST AGREEMENT
Dated as of
July 15, 1994
BETWEEN
THE FIRST NATIONAL BANK OF CHICAGO,
not individually but solely
as Pass Through Trustee,
AND
NEWMONT GOLD COMPANY
Newmont Gold Company
Pass Through Trust, [1994-A1][1994-A2]
================================================================================
<PAGE> 2
CROSS REFERENCE SHEET
Between
Provisions of the Trust Indenture Act of 1939, as amended,
and the Pass Through Trust Agreement:
<TABLE>
<CAPTION>
Section of
Section of the Act the Agreement
- ------------------ -------------
<S> <C>
310(a)(1) and (2)............................... 10.02
310(a)(3) ...................................... 10.05
310(a)(4)....................................... *
(1)310(a)(5).................................... *
310(b)(i)-(iii)................................. 10.01, 10.03
310(b)(remainder)............................... *
310(c).......................................... Inapplicable
311(a).......................................... *
311(b).......................................... *
311(c).......................................... Inapplicable
312(a).......................................... 2.12, 4.01
312(b).......................................... *
312(c).......................................... 4.02
313(a).......................................... 4.04
313(b)(1)....................................... *
313(b)(2)....................................... *
313(c).......................................... 4.04
313(d).......................................... *
314(a).......................................... 4.03
314(b).......................................... Inapplicable
314(c)(1) and (2)............................... 13.07
314(c)(3)....................................... Inapplicable
314(d)(1)....................................... *
314(d)(2)....................................... *
314(d)(3)....................................... *
314(e).......................................... 13.07
314(f).......................................... Inapplicable
315(a), (c) and (d)............................. *
315(b).......................................... 7.11
315(e).......................................... *
316(a)(1)....................................... 7.09, 7.10
316(a)(2)....................................... *
316(a)(last sentence)........................... 6.04
316(b).......................................... 7.08
316(c).......................................... 6.01(b)
317(a).......................................... 7.03, 7.05
317(b).......................................... 3.04
318(a).......................................... 13.08
</TABLE>
____________________
(1)* Intentionally deleted.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I
DEFINITIONS
ARTICLE II
DESIGNATIONS; PASS THROUGH TRUST FORMATION;
ISSUANCE OF PASS THROUGH CERTIFICATES;
ACQUISITION OF EQUIPMENT NOTES
SECTION 2.01. Designations; Aggregate Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 2.02. Issuance of Pass Through Certificates; Acquisition of Equipment Notes . . . . . . . . . . . . . . . . . 10
SECTION 2.03. Declaration of Trust; Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.04. Limitation of Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.05. Execution of Pass Through Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.06. Certificate of Authentication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.07. Form of Pass Through Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 2.08. Registration, Transfer and Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 2.09. Mutilated, Defaced, Destroyed, Lost and Stolen Pass Through Certificates . . . . . . . . . . . . . . . 14
SECTION 2.10. Cancellation of Pass Through Certificates; Destruction Thereof . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.11. Temporary Pass Through Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.12. Pass Through Certificates Issuable in the Form of a Registered Global Security . . . . . . . . . . . . 17
SECTION 2.13. Appointment of Authenticating Agent; Paying Agent and Registrar . . . . . . . . . . . . . . . . . . . . 19
</TABLE>
-i-
<PAGE> 4
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE III
CERTAIN REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 3.01. Representations, Warranties and Covenants of the Company . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 3.02. Offices for Payments; Registrar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 3.03. Representations and Warranties of the Pass Through Trustee . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 3.04. Paying Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 3.05. No Representations or Warranties as to Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 3.06. Payments from Trust Property Only . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 3.07. Limitation of the Company's Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE IV
CERTIFICATEHOLDER LISTS AND REPORTS BY THE
COMPANY AND THE PASS THROUGH TRUSTEE
SECTION 4.01. Certificateholder Lists; Ownership of Pass Through Certificates . . . . . . . . . . . . . . . . . . . . 24
SECTION 4.02. Disclosure of Certificateholder Lists . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 4.03. Reports by the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 4.04. Reports by the Pass Through Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
ARTICLE V
RECEIPT AND DISTRIBUTION OF INCOME
AND PROCEEDS FROM THE TRUST PROPERTY
SECTION 5.01. Distribution Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 5.02. Record Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 5.03. Certificate Account and Special Payments Account . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 5.04. Distributions from Certificate Account and Special Payments Account . . . . . . . . . . . . . . . . . . 27
SECTION 5.05. Statements to Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 5.06. Investment of Special Payment Moneys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
</TABLE>
-ii-
<PAGE> 5
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
SECTION 5.07. Withholding Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE VI
CONCERNING THE CERTIFICATEHOLDERS
SECTION 6.01. Evidence of Action Taken by Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 6.02. Proof of Execution of Instruments and of Holding of Certificates . . . . . . . . . . . . . . . . . . . 31
SECTION 6.03. Certificateholders to Be Treated as Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 6.04. Pass Through Certificates Owned by the Company and Related Owner Trustees Deemed Not Outstanding . . . 32
SECTION 6.05. Right of Revocation of Action Taken . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 6.06. ERISA Plan Prohibition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
ARTICLE VII
REMEDIES OF PASS THROUGH TRUSTEE
AND CERTIFICATEHOLDERS
SECTION 7.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 7.02. Incidents of Sale of Equipment Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 7.03. Pass Through Trustee May Prove Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 7.04. Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 7.05. Suits for Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 7.06. Discontinuance of Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 7.07. Limitations on Suits by Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 7.08. Unconditional Right of Certificateholders to Receive Principal, Interest and Premium, and to
Institute Certain Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 7.09. Control by Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 7.10. Waiver of Past Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 7.11. Notice of Pass Through Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
</TABLE>
-iii-
<PAGE> 6
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE VIII
CONCERNING THE PASS THROUGH TRUSTEE
SECTION 8.01. Acceptance by Pass Through Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 8.02. Pass Through Trustee's Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 8.03. Certain Rights of the Pass Through Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 8.04. Pass Through Trustee Not Responsible for Recitals. . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 8.05. Pass Through Trustee and Agents May Hold Pass Through Certificates; Collections . . . . . . . . . . . . 42
SECTION 8.06. Moneys Held by Pass Through Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 8.07. Right of Pass Through Trustee to Rely on Officers' Certificate . . . . . . . . . . . . . . . . . . . . 43
SECTION 8.08. Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE IX
INDEMNIFICATION OF
PASS THROUGH TRUSTEE BY THE COMPANY
ARTICLE X
SUCCESSOR TRUSTEES
SECTION 10.01. Resignation and Removal of Pass Through Trustee; Appointment of Successor . . . . . . . . . . . . . . 45
SECTION 10.02. Persons Eligible for Appointment as Pass Through Trustee . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 10.03. Acceptance of Appointment by Successor Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 10.04. Merger, Conversion, Consolidation or Succession to Business of Pass Through Trustee . . . . . . . . . 48
SECTION 10.05. Appointment of Separate Pass Through Trustees . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
</TABLE>
-iv-
<PAGE> 7
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE XI
SUPPLEMENTS AND AMENDMENTS TO THIS
PASS THROUGH AGREEMENT AND OTHER DOCUMENTS
SECTION 11.01. Supplemental Agreements Without Consent of Certificateholders . . . . . . . . . . . . . . . . . . . . 51
SECTION 11.02. Supplemental Agreements With Consent of Certificateholders . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 11.03. Effect of Supplemental Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.04. Documents to Be Given to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.05. Notation on Pass Through Certificates in Respect of Supplemental Agreements . . . . . . . . . . . . . 55
SECTION 11.06. Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 11.07. Revocation and Effect of Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 11.08. Amendments, Waivers, etc., of Related Indenture Documents . . . . . . . . . . . . . . . . . . . . . . 55
ARTICLE XII
TERMINATION OF PASS THROUGH TRUSTS;
UNCLAIMED MONEYS
SECTION 12.01. Termination of Pass Through Trusts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 12.02. Application by Pass Through Trustee of Funds Deposited for Payment of Pass Through Certificates . . . 57
SECTION 12.03. Repayment of Moneys Held by Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 12.04. Transfer of Moneys Held by Pass Through Trustee and Paying Agent Unclaimed for Two Years and
Eleven Months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
ARTICLE XIII
MISCELLANEOUS
SECTION 13.01. Capacity in Which Acting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 13.02. No Legal Title to Trust Property in Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 13.03. Certificates Nonassessable and Fully Paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
</TABLE>
-v-
<PAGE> 8
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 13.04. Pass Through Agreement for the Benefit of the Company, the Pass Through Trustee and
the Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 13.05. Limitation on Rights of Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 13.06. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 13.07. Officers' Certificates and Opinions of Counsel; Statements to Be Contained Therein . . . . . . . . . . 60
SECTION 13.08. Conflict of Any Provision of Pass Through Agreement with the Trust Indenture Act . . . . . . . . . . . 61
SECTION 13.09. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 13.10. No Oral Modifications or Continuing Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 13.11. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 13.12. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 13.13. Normal Commercial Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 13.14. Governing Law; Counterpart Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 13.15. Distributions Due on Days Other than Business Days . . . . . . . . . . . . . . . . . . . . . . . . . . 62
EXHIBIT A - Form of Pass Through Certificate
SCHEDULE I - Description of Equipment Notes and
Related Indenture Documents
</TABLE>
-vi-
<PAGE> 9
PASS THROUGH TRUST AGREEMENT [1994-A1][1994-A2]
PASS THROUGH TRUST AGREEMENT dated as of July 15, 1994, between
NEWMONT GOLD COMPANY, a Delaware corporation (the "Company"), and THE FIRST
NATIONAL BANK OF CHICAGO, a national banking association organized under the
laws of the United States of America, not individually but solely as Pass
Through Trustee (the "Pass Through Trustee").
RECITALS
WHEREAS, capitalized terms used herein shall have the respective
meanings set forth or referred to in Article I hereof;
WHEREAS, pursuant to the Participation Agreements, the Company has
agreed to cause the Equipment Notes to be issued and sold to the Pass Through
Trustee, and the Pass Through Trustee has agreed to purchase the Equipment
Notes, which will be held in trust as Trust Property for the benefit of the
Certificateholders;
WHEREAS, in order to facilitate such sale, the Company has agreed,
pursuant to the Underwriting Agreement, to cause the Pass Through Trustee to
issue and sell the Pass Through Certificates to the Underwriters;
WHEREAS, pursuant to this Pass Through Agreement, the Pass Through
Trustee will execute, authenticate and deliver the Pass Through Certificates to
the Underwriters upon receipt by the Pass Through Trustee of the purchase price
therefor, which will be applied in accordance with this Pass Through Agreement
to purchase the Equipment Notes;
WHEREAS, the Pass Through Trustee hereby declares the creation of
this Pass Through Trust for the benefit of the Certificateholders, and the
initial Certificateholders of such Pass Through Certificates, as the grantors
of such Pass Through Trust, by their respective acceptances of such Pass
Through Certificates, join in the creation of the Pass Through Trust;
WHEREAS, to facilitate the sale of the Equipment Notes to, and the
purchase of the Equipment Notes by, the Pass Through Trustee on behalf of this
Pass Through Trust, the Company has duly authorized the execution and delivery
of this Pass Through Agreement as the "issuer," as such term is
<PAGE> 10
defined in and solely for purposes of the Securities Act, of the Pass Through
Certificates and as the "obligor," as such term is defined in and solely for
purposes of the Trust Indenture Act, with respect to all such Pass Through
Certificates; and
WHEREAS, this Pass Through Agreement is subject to the provisions
of the Trust Indenture Act and shall, to the extent applicable, be governed by
such provisions;
IT IS HEREBY COVENANTED AND AGREED by and between the parties
hereto as follows:
ARTICLE I
DEFINITIONS
The following terms (except as otherwise expressly provided or
unless the context otherwise clearly requires) for all purposes of this Pass
Through Agreement have the respective meanings specified in this Section. All
other terms used in this Pass Through Agreement that are defined in the Trust
Indenture Act (as defined below) or the definitions of which in the Securities
Act (as defined below) are referred to in the Trust Indenture Act (except as
herein otherwise expressly provided or unless the context otherwise requires),
have the meanings assigned to such terms in the Trust Indenture Act and in the
Securities Act as in force at the date of this Pass Through Agreement. All
accounting terms used and not expressly defined herein have the meanings given
to them in accordance with generally accepted accounting principles, and the
term "generally accepted accounting principles" means the accounting principles
that are generally accepted at the date or time of any computation or otherwise
at the date hereof. The words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Pass Through Agreement as a whole and not
to any particular Article, Section or other subdivision. References to
designated "Articles," "Sections," "subsections" and other subdivisions of this
Pass Through Agreement are to the designated Articles, Sections, subsections
and other subdivisions of this Pass Through Agreement as originally executed.
The terms defined in this Article include the plural as well as the singular.
"Affiliate" has, for any Person, the meaning specified in Rule 0-2
under the Trust Indenture Act.
2
<PAGE> 11
"Applicable Law" means all laws, including Federal, state and
local laws, ordinances, judgments, decrees, injunctions, writs and orders, and
rules, regulations, orders, interpretations, licenses and permits of any
Governmental Authority.
"Authenticating Agent" has the meaning set forth in Section 2.13
hereof.
"Business Day" means any day other than Saturday, Sunday or other
day on which banking institutions in the States of New York, Illinois or
Connecticut, or any other state in which the Pass Through Trustee or any
Related Indenture Trustee or Related Owner Trustee for the Pass Through Trust
maintains an office for the receipt or disbursement of funds for the
transactions contemplated herein or in any Indenture Documents for the
Equipment Notes, are authorized or required by law to close.
"Certificate Account" means the account or accounts created and
maintained pursuant to Section 5.03(a).
"Certificateholder" means the registered holder of any Pass
Through Certificate as evidenced on the Register.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or if at any time
after the execution and delivery of this Pass Through Agreement such Commission
is not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties on such date.
"Company" means Newmont Gold Company, a Delaware corporation, and
its permitted successors and assigns hereunder.
"Corporate Trust Office" means the corporate trust office of the
Pass Through Trustee located at One First National Plaza, Suite 0126, Chicago,
Illinois 60670-0126, Attention: Corporate Trust Services Division, or such
other office at which the Pass Through Trustee's corporate trust business shall
be administered and which the Pass Through Trustee shall have specified by
notice in writing to the Company and the Certificateholders.
3
<PAGE> 12
"Delivery Date" means, for any Equipment Notes, the Closing Date
(as such term is defined in the related Participation Agreement) for such
Equipment Notes.
"Depository" means the depository of the Registered Global
Certificate representing the Pass Through Certificates and any successor to
such depository appointed by the Company pursuant hereto. Such depository
initially shall be The Depository Trust Company, a New York corporation.
"Distribution Date" means any Regular Distribution Date or Special
Distribution Date or both.
"Dollars" and "$" mean lawful currency of the United States of
America.
"Equipment Note" means any "Note," as such term is defined in the
related Indenture, issued by an Owner Trustee pursuant to such Indenture and
listed in Schedule I hereto, which is to be held by the Pass Through Trustee as
part of the Trust Property.
"Event of Default" has the meaning specified in Section 7.01
hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Fractional Undivided Interest" means, for any Pass Through
Certificate, the fractional undivided interest in the Pass Through Trust that
is evidenced thereby.
"Governmental Authority" shall mean any Federal, state, county,
municipal, regional or other governmental or taxing authority, agency, board or
court.
"Government Obligations" means direct obligations of the United
States of America which are not callable, redeemable or payable prior to
maturity, in whole or in part, directly or indirectly, by any Person.
"Indenture" means for any Equipment Note, the trust indenture and
security agreement listed in Schedule I hereto between the Related Indenture
Trustee and the Related Owner Trustee pursuant to which such Equipment Note is
issued as such agreement may be modified, supplemented or amended from time to
time in accordance with the related Indenture Documents, and "Indentures" means
all such Indentures for all Equipment Notes.
4
<PAGE> 13
"Indenture Default" means, for any Indenture, any event or
condition defined as a "Default" under such Indenture.
"Indenture Documents" means for any Equipment Note, the related
Indenture, the related Trust Agreement and Lease, in each case as defined in
such Indenture, and the related Participation Agreement.
"Indenture Event of Default" means, for any Indenture, any event
or condition defined as an "Indenture Event of Default" in such Indenture.
"Indenture Trustee" means, for any Equipment Note, the Person
defined as such in the related Indenture.
"Initial Regular Distribution Date" means the first Regular
Distribution Date following the Issuance Date.
"Issuance Date" means the date of the issuance of the Pass Through
Certificates, which shall be the same date as the Delivery Date.
"Lease" means, for any Equipment Note, the agreement between the
Company, as lessee, and the Related Owner Trustee, as lessor, that is defined
as the "Lease" in the related Indenture.
"Letter of Representations" means a letter from the Company and
the Pass Through Trustee to, and accepted by, the Depository in form and
substance satisfactory to the Company and the Pass Through Trustee, as such
letter may be modified or supplemented, or any successor letter thereto.
"Lien" means any mortgage, pledge, lien, charge, disposition of
title, encumbrance, lease or security interest.
"Majority in Interest of Certificateholders" means, at any time,
Pass Through Certificates then Outstanding (or the proxy therefor) representing
in the aggregate not less than a majority of the aggregate Fractional Undivided
Interests of the Pass Through Certificates then Outstanding under the Pass
Through Trust.
"Officers' Certificate" means a certificate signed by a
Responsible Officer of the Company, any Indenture Trustee or any Owner Trustee,
as the case may be, delivered to the Pass Through Trustee. Each such
certificate shall include the statements provided for in Section 13.07.
5
<PAGE> 14
"Opinion of Counsel" means a written opinion of legal counsel, who
in the case of counsel (a) for the Company may be (i) an attorney employed by
the Company who is generally empowered to deliver such written opinions or (ii)
other counsel designated by the Company and reasonably satisfactory to the Pass
Through Trustee and (b) for any Owner Trustee or Indenture Trustee, an attorney
selected by such Person and reasonably satisfactory to the Pass Through
Trustee.
"Outstanding" means, as of the date of determination and subject
to the provisions of Section 6.04 hereof, all Pass Through Certificates
theretofore authenticated and delivered, with the exception of the following:
(i) Pass Through Certificates theretofore cancelled by the Pass
Through Trustee or delivered to the Pass Through Trustee for cancellation
pursuant to Section 2.10;
(ii) All Pass Through Certificates if money in the amount required
to make the final distribution thereon in accordance with Section 12.01 has
been theretofore deposited with the Pass Through Trustee in trust for the
Certificateholders pending such final distribution; and
(iii) Pass Through Certificates in exchange for or in lieu of which
other Pass Through Certificates have been authenticated and delivered
pursuant to Article II hereof.
"Overdue Scheduled Payment" means any Scheduled Payment that is
not received within five Business Days after the Regular Distribution Date
applicable to such Scheduled Payment.
"Owner Participant" means, for any Equipment Note, the Person
defined as such in the related Indenture.
"Owner Trustee" means, for any Equipment Note, the Person defined
as such in the related Indenture.
"Participation Agreement" means for any Equipment Note, the
agreement among the Company, the Owner Participant, the Related Owner Trustee,
the Related Indenture Trustee and the Pass Through Trustee, that is defined as
the "Participation Agreement" in the related Indenture and listed in Schedule I
hereto, and pursuant to which the Pass Through Trustee agrees to purchase such
Equipment Note upon the issuance thereof by such Owner Trustee, and
"Participation
6
<PAGE> 15
Agreements" means all such Participation Agreements for all Equipment Notes.
"Pass Through Agreement," "this Pass Through Agreement" and other
like words mean this Pass Through Trust Agreement as the same may be modified,
supplemented or amended from time to time in accordance with the provisions
hereof.
"Pass Through Certificate" means any of the certificates
designated in Section 2.01 hereof and executed, authenticated and delivered by
the Pass Through Trustee, in accordance with this Pass Through Agreement.
"Pass Through Default" means an Event of Default or an event or
condition that, with the giving of notice or the lapse of time or both, would
become an Event of Default.
"Pass Through Trust" means the trust created in accordance with
this Pass Through Agreement, the estate of which consists of the Trust
Property.
"Pass Through Trustee" means The First National Bank of Chicago, a
national banking association, not in its individual capacity except as
expressly stated herein, but solely in its capacity as Pass Through Trustee
under this Pass Through Agreement, and its successors and assigns as Pass
Through Trustee hereunder.
"Paying Agent" has the meaning set forth in Section 3.04 hereof.
"Permitted Investments" means any Government Obligations.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, nonincorporated organization
or government or any agency or political subdivision thereof.
"Pool Balance" means as of any date of determination the aggregate
unpaid principal amount of the Equipment Notes on such date plus the amount of
the principal payments on such Equipment Notes held by the Pass Through Trustee
and not yet distributed (other than earnings thereon and without giving effect
to any losses on investments thereof). The Pool Balance as of any Regular
Distribution Date or Special Distribution Date shall be computed after giving
effect to the payment of principal, if any, on the Equipment Notes and the
distribution thereof being made on that date.
7
<PAGE> 16
"Pool Factor" means as of any date of determination the quotient
(rounded to the seventh decimal place) computed by dividing (i) the Pool
Balance by (ii) the aggregate original amount of the Pass Through Certificates.
The Pool Factor as of any Regular Distribution Date or Special Distribution
Date shall be computed after giving effect to the payment of principal, if any,
on the Equipment Notes and the distribution thereof being made on that date.
"Record Date" means any Record Date specified in Section 5.02
hereof.
"Register" has the meaning set forth in Section 3.02 hereof.
"Registered Global Certificate" means any Pass Through Certificate
issued to the Depository in accordance with Article II and bearing the legend
prescribed in Section 2.12(a).
"Registrar" has the meaning set forth in Section 3.02 hereof.
"Regular Distribution Date" means any date specified in Section
5.01 hereof for the distribution of any Scheduled Payment from the Pass Through
Trust to the Certificateholders.
"Related Indenture Trustee" means any Indenture Trustee under an
Indenture relating to any Equipment Note, and "Related Indenture Trustees"
means all such Indenture Trustees for all Equipment Notes.
"Related Owner Participant" means any Owner Participant under a
Trust Agreement relating to any Equipment Note, and "Related Owner
Participants" means all such Owner Participants for all Equipment Notes.
"Related Owner Trustee" means any Owner Trustee under a Trust
Agreement relating to any Equipment Note, and "Related Owner Trustees" means
all such Owner Trustees for all Equipment Notes.
"Responsible Officer" means the president or any other officer
with authority of at least a vice president; or, in the case of the Pass
Through Trustee, a vice president, assistant vice president or a trust officer
of the Pass Through Trustee in its Corporate Trust Administration department.
8
<PAGE> 17
"Scheduled Payment" means any scheduled payment of principal of
(whether by installment or redemption or otherwise) and interest on any
Equipment Note to be made in the amounts and on the date set forth for such
payment in such Equipment Note, but does not include any Overdue Scheduled
Payment.
"Securities Act" means the Securities Act of 1933, as amended.
"Special Distribution Date" means any date specified in Section
5.01 hereof on which a Special Payment is to be distributed from the Pass
Through Trust to the Certificateholders.
"Special Payment" means any payment (including any Overdue
Scheduled Payment) other than a Scheduled Payment on any Equipment Note or any
proceeds from the sale of such Equipment Note pursuant to Article VII.
"Special Payments Account" means the account or accounts created
and maintained for the Pass Through Trust pursuant to Section 5.03(b).
"Tangible Net Worth" means, with respect to a Person, the excess
of tangible assets over liabilities of such Person as shown on its balance
sheet as of the end of its most recent fiscal period for which a balance sheet
is available or as of such other date as the context may require, and
determined on the basis of generally accepted accounting principles.
"Trust Agreement" means, for any Equipment Note, the agreement
between an Owner Trustee and an Owner Participant that is defined as the "Trust
Agreement" in the related Indenture.
"Trust Indenture Act" means (except as otherwise provided in
Sections 4.04, 11.01, 11.02 and 11.06) the Trust Indenture Act of 1939, as
amended, as in force at the date as of which this Pass Through Agreement was
first qualified under such Act.
"Trust Property" means all money, instruments, including the
Equipment Notes, and other property held as the property of the Pass Through
Trust, including all distributions thereon and proceeds thereof.
"Underwriters" means the several Underwriters named in the
Underwriting Agreement.
9
<PAGE> 18
"Underwriting Agreement" means the Underwriting Agreement dated
_____________ among the Company and Salomon Brothers Inc, Chemical Securities
Inc., CS First Boston Corporation and Lazard Freres & Co.
ARTICLE II
DESIGNATIONS; PASS THROUGH TRUST FORMATION;
ISSUANCE OF PASS THROUGH CERTIFICATES;
ACQUISITION OF EQUIPMENT NOTES
SECTION 2.01. Designations; Aggregate Amount.
(a) The Pass Through Trust created hereby shall be designated Newmont Gold
Company Pass Through Trust, [1994-A1][1994-A2]. The Pass Through Certificates
evidencing Fractional Undivided Interests in the Pass Through Trust shall be
designated as the Newmont Gold Company 1994 Pass Through Certificates, Series
[A1][A2] (herein sometimes called the "Series [A1][A2] Pass Through
Certificates") and shall bear such designation upon their face. The Series
[A1][A2] Pass Through Certificates shall be the only instruments evidencing a
fractional undivided interest in the Pass Through Trust.
(b) All Pass Through Certificates shall be substantially
identical except as to denomination and as may otherwise be provided herein.
The Pass Through Certificates will have no rights, benefits or interest in
respect of any other separate pass through trust or the trust property held in
such other pass through trust. All Pass Through Certificates shall be in all
respects equally and ratably entitled to the benefits of the Pass Through Trust
without preference, priority, or distinction on account of the actual time or
times of authentication and delivery, all in accordance with the terms and
provisions of this Pass Through Agreement.
(c) Except as provided in Section 2.09 hereof, the aggregate
amount of Series [A1][A2] Pass Through Certificates that may be authenticated,
delivered and outstanding under this Pass Through Agreement is limited to
$__________.
SECTION 2.02. Issuance of Pass Through Certificates; Acquisition
of Equipment Notes. (a) Subject to the terms set forth herein, on the
Issuance Date (i) the Company shall direct the Underwriters to execute a wire
transfer or intra-bank transfer to the Pass Through Trustee in the amount of
the total proceeds payable by such Underwriters pursuant to the Underwriting
Agreement with respect to the
10
<PAGE> 19
Series [A1][A2] Pass Through Certificates and (ii) the Pass Through Trustee
shall execute, authenticate and deliver the Series [A1][A2] Pass Through
Certificates to the Underwriters as provided in the Underwriting Agreement upon
receipt by the Pass Through Trustee of such proceeds.
The Pass Through Certificates executed, authenticated and
delivered by the Pass Through Trustee in accordance with this Section 2.02(a)
shall equal in the aggregate the aggregate principal amount of the Equipment
Notes to be purchased by the Pass Through Trustee pursuant to the Participation
Agreements, and evidence the entire ownership of the Pass Through Trust. The
Pass Through Trustee shall issue and sell such Pass Through Certificates, in
authorized denominations and in such Fractional Undivided Interests, so as to
result in the receipt of consideration in an amount equal to the aggregate
principal amount of such Equipment Notes and, concurrently therewith, the Pass
Through Trustee shall purchase, pursuant to the terms and conditions of the
Participation Agreements, such Equipment Notes at a purchase price equal to the
amount of such consideration so received. Except as provided in Sections 2.08
and 2.09, the Pass Through Trustee shall not execute, authenticate or deliver
Pass Through Certificates in excess of the aggregate amount determined in
accordance with this subsection (a).
(b) The obligations of the Pass Through Trustee to participate in
the transactions described in clause (a) of this Section 2.02 are subject to
(i) receipt by the Pass Through Trustee of a certificate of the Company to the
same effect as the certificate of the Company delivered to the Underwriters
pursuant to Section ____ of the Underwriting Agreement, and (ii) satisfaction
or waiver of the conditions for the purchase by the Underwriters of the Pass
Through Certificates set forth in Section ____ of the Underwriting Agreement,
which satisfaction or waiver for the purposes hereof shall be conclusively
demonstrated by the receipt by the Pass Through Trustee of the total proceeds
payable by such Underwriters pursuant to the Underwriting Agreement with
respect to the Series [A1][A2] Pass Through Certificates.
SECTION 2.03. Declaration of Trust; Authorization. Each initial
Certificateholder, by its payment for and acceptance of any Series [A1][A2]
Pass Through Certificate is hereby deemed (1) as grantor, to join in the
creation and declaration of this Pass Through Trust and (2) as beneficiary of
such Pass Through Trust, to authorize and direct the Pass Through Trustee to
execute and deliver all documents to which the Pass Through Trustee is a party
that may be necessary or desirable to consummate the transactions contemplated
hereby
11
<PAGE> 20
and to exercise its rights and perform its duties under the Participation
Agreements, the Indentures and this Pass Through Agreement.
The Pass Through Trustee hereby acknowledges and accepts this
grant of trust and declares that it will hold the Trust Property as Pass
Through Trustee upon this Pass Through Trust for the use and benefit of the
Certificateholders.
SECTION 2.04. Limitation of Powers. The Pass Through Trust shall
be constituted solely for the purpose of making the investment in the Equipment
Notes provided for herein, and, except as set forth herein, the Pass Through
Trustee shall not be authorized or empowered to acquire any other investments
or engage in any other activities and, in particular, the Pass Through Trustee
shall not be authorized or empowered to do anything that would cause such Pass
Through Trust to fail to qualify as a "grantor trust" for federal income tax
purposes (including as subject to this restriction, to acquire any interest in
the Facility (as defined in the respective related Indentures) by bidding such
Equipment Notes or otherwise, or taking any action with respect to the Facility
once acquired).
SECTION 2.05. Execution of Pass Through Certificates. The Pass
Through Certificates shall be signed on behalf of the Pass Through Trustee by
an authorized officer of the Pass Through Trustee. Such signatures may be the
manual or facsimile signatures of such officer and minor errors or defects in
any reproduction of any such signature shall not affect the validity or
enforceability of any Pass Through Certificate which has been duly
authenticated and delivered by the Pass Through Trustee.
If any such officer of the Pass Through Trustee who signs any of
the Pass Through Certificates subsequently ceases to be such officer before the
Pass Through Certificate so signed is authenticated and delivered or disposed
of by the Pass Through Trustee, such Pass Through Certificate nevertheless may
be authenticated and delivered or disposed of as though the person who signed
such Pass Through Certificate had not ceased to be such officer of the Pass
Through Trustee.
SECTION 2.06. Certificate of Authentication. The Pass Through
Trustee shall duly authenticate and deliver Pass Through Certificates in
authorized denominations equalling in the aggregate, the aggregate principal
amount of the Equipment Notes to be purchased for the Pass Through Trust by the
Pass Through Trustee pursuant to the Participation Agreements, and evidencing
the entire ownership of the Pass Through Trust.
12
<PAGE> 21
Only such Pass Through Certificates as shall bear thereon a certificate of
authentication substantially in the form set forth in Exhibit A, executed by
the Pass Through Trustee by manual or facsimile signature of one of its
authorized officers, shall be entitled to the benefits of the Pass Through
Trust or be valid or obligatory for any purpose. Such certificate by the Pass
Through Trustee upon any Pass Through Certificate executed by the Pass Through
Trustee shall be conclusive evidence that the Pass Through Certificate so
authenticated has been duly authenticated and delivered hereunder and that the
Certificateholder, as evidenced on the Register, is entitled to the benefits of
the Pass Through Trust.
SECTION 2.07. Form of Pass Through Certificates. The Pass
Through Certificates shall be substantially in the form set forth in Exhibit A
hereto. The Pass Through Certificates shall be issuable as registered
securities without coupons and shall be numbered, lettered, or otherwise
distinguished in such manner or in accordance with such plans as set forth
herein. The Pass Through Certificates shall be issued in denominations of
$1,000 and any integral multiple thereof and shall be dated the date of their
authentication.
The Pass Through Certificates may be issued with appropriate
insertions, omissions, substitutions and variations, and may have imprinted or
otherwise reproduced thereon such legend or legends, not inconsistent with the
provisions of this Pass Through Agreement, as may be required to comply with
any law or with any rules or regulations pursuant thereto, or with the rules of
any securities market in which the Pass Through Certificates are admitted to
trading, or to conform to general usage.
SECTION 2.08. Registration, Transfer and Exchange. The Pass
Through Trustee will keep at each office or agency to be maintained for the
purpose as provided in Section 3.02 a Register or Registers in which, subject
to such reasonable regulations as it may prescribe, it will register, and will
register the transfer of, Pass Through Certificates as provided in this
Article. Such Register shall be in written form in the English language or in
any other form capable of being converted into such form within a reasonable
time.
Upon due presentation for registration of transfer of any Pass
Through Certificate at any such office or agency, the Pass Through Trustee
shall execute, authenticate and deliver in the name of the transferee or
transferees a new Pass Through Certificate or Pass Through Certificates in
13
<PAGE> 22
authorized denominations and for a like aggregate Fractional Undivided
Interest.
Any Pass Through Certificate or Pass Through Certificates may be
exchanged for a Pass Through Certificate or Pass Through Certificates in other
authorized denominations and for a like aggregate Fractional Undivided
Interest. Pass Through Certificates to be exchanged shall be surrendered at
any office or agency to be maintained by the Pass Through Trustee for the
purpose as provided in Section 3.02, and the Pass Through Trustee shall
execute, authenticate and deliver in exchange therefor the Pass Through
Certificate or Pass Through Certificates which the Certificateholder making the
exchange shall be entitled to receive, bearing numbers not contemporaneously or
previously outstanding.
All Pass Through Certificates presented for registration of
transfer, exchange, redemption or payment shall (if so required by the Pass
Through Trustee) be duly endorsed by, or be accompanied by a written instrument
or instruments of transfer in form satisfactory to the Pass Through Trustee
duly executed by, the Certificateholder or his or her attorney duly authorized
in writing.
The Pass Through Trustee may require payment from the
Certificateholder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any exchange or registration of
transfer of Pass Through Certificates. No service charge to the
Certificateholder shall be made for any such transaction.
All Pass Through Certificates issued upon any transfer or exchange
of Pass Through Certificates shall be entitled to the same benefits under this
Pass Through Agreement as the Pass Through Certificates surrendered upon such
transfer or exchange.
SECTION 2.09. Mutilated, Defaced, Destroyed, Lost and Stolen Pass
Through Certificates. If any temporary or definitive Pass Through Certificate
becomes mutilated, defaced or is apparently destroyed, lost or stolen, the Pass
Through Trustee in its discretion may execute, authenticate and deliver, a new
Pass Through Certificate of like Fractional Undivided Interest, bearing a
number not contemporaneously or previously outstanding, in exchange and
substitution for the mutilated or defaced Pass Through Certificate, or in lieu
of and substitution for the Pass Through Certificate so apparently destroyed,
lost or stolen. In every case the applicant for a substitute Pass Through
Certificate shall furnish to the Pass Through Trustee and any agent of the Pass
14
<PAGE> 23
Through Trustee such security or indemnity as may be required by them to
indemnify and defend and to save each of them harmless from any such
substitution and, in every case of destruction, loss or theft, evidence to
their satisfaction of the apparent destruction, loss or theft of such Pass
Through Certificate and of the ownership thereof.
Upon the issuance of any substitute Pass Through Certificate, the
Pass Through Trustee may require payment from the Certificateholder of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other reasonable expenses (including the reasonable
fees and expenses of the Pass Through Trustee) connected therewith. If a
notice of termination for the Pass Through Trust has been or is about to be
given pursuant to Section 12.01 and a Pass Through Certificate becomes
mutilated or defaced or is apparently destroyed, lost or stolen, the Pass
Through Trustee may, instead of issuing a substitute Pass Through Certificate,
pay or authorize the payment of the same (without surrender thereof except in
the case of a mutilated or defaced Pass Through Certificate), if the applicant
for such payment furnishes to the Pass Through Trustee and any agent of the
Pass Through Trustee such security or indemnity as any of them may require to
save each of them harmless from all risks, however remote, resulting from such
payment and, in every case of apparent destruction, loss or theft, the
applicant shall also furnish to the Pass Through Trustee and any agent of the
Pass Through Trustee evidence to their satisfaction of the apparent
destruction, loss or theft of such Pass Through Certificate and of the
ownership thereof.
Every substitute Pass Through Certificate issued pursuant to the
provisions of this Section by virtue of the fact that any Pass Through
Certificate is apparently destroyed, lost or stolen will constitute conclusive
evidence of the Fractional Undivided Interest evidenced by the Pass Through
Certificate that it replaces, whether or not the apparently destroyed, lost or
stolen Pass Through Certificate may be enforceable at any time by anyone and
will be entitled to all the benefits of (but will be subject to all the
limitations of rights set forth in) the Pass Through Trust equally and
proportionately with any and all other Pass Through Certificates duly
authenticated and delivered therefor. All Pass Through Certificates will be
held and owned upon the express condition that, to the extent permitted by law,
the foregoing provisions are exclusive with respect to the replacement or
payment of mutilated, defaced, or apparently destroyed, lost or stolen Pass
Through Certificates and will preclude any and all other rights or remedies
notwithstanding any law or statute existing or hereafter
15
<PAGE> 24
enacted to the contrary with respect to the replacement or payment of
negotiable instruments or other securities without their surrender.
SECTION 2.10. Cancellation of Pass Through Certificates;
Destruction Thereof. All Pass Through Certificates surrendered for payment,
redemption, registration of transfer or exchange, if surrendered to any agent
of the Pass Through Trustee, shall be delivered to the Pass Through Trustee for
cancellation or, if surrendered to the Pass Through Trustee, shall be cancelled
by it; and no Pass Through Certificates shall be issued in lieu thereof except
as expressly permitted by any of the provisions of this Pass Through Agreement.
The Pass Through Trustee shall destroy cancelled Pass Through Certificates held
by it in accordance with its customary procedures.
SECTION 2.11. Temporary Pass Through Certificates. Pending the
preparation of definitive Pass Through Certificates, the Pass Through Trustee
may execute, authenticate and deliver temporary Pass Through Certificates
(printed, lithographed, typewritten or otherwise reproduced, in each case in
form satisfactory to the executing officer of the Pass Through Trustee, as
evidenced by such officer's execution thereof). Such temporary Pass Through
Certificates shall be issuable as registered Pass Through Certificates without
coupons, of any authorized denomination, and substantially in the form of the
definitive Pass Through Certificates but with such omissions, insertions and
variations as may be appropriate for temporary Pass Through Certificates, all
as may be determined by the executing officer of the Pass Through Trustee, as
evidenced by such officer's execution thereof. Temporary Pass Through
Certificates may contain such reference to any provisions of this Pass Through
Agreement as may be appropriate. Every such temporary Pass Through Certificate
shall be executed and authenticated by the Pass Through Trustee upon the same
conditions and in substantially the same manner, and with like effect, as the
definitive Pass Through Certificates. Without unreasonable delay the Company
shall furnish definitive Pass Through Certificates and thereupon temporary Pass
Through Certificates shall be surrendered in exchange therefor without charge
at any office or agency to be maintained by the Pass Through Trustee for the
purpose pursuant to Section 3.02, and the Pass Through Trustee shall execute,
authenticate and deliver in exchange for such temporary Pass Through
Certificates such definitive Pass Through Certificates evidencing a like
aggregate Fractional Undivided Interest in authorized denominations. Until so
exchanged, temporary Pass Through Certificates shall be entitled to the same
benefits
16
<PAGE> 25
under the Pass Through Trust as definitive Pass Through Certificates.
SECTION 2.12. Pass Through Certificates Issuable in the Form of a
Registered Global Security. The Pass Through Certificates initially shall be
issued as one or more Registered Global Certificates in accordance with this
Section. To the extent that the provisions of this Section conflict with any
other provisions of this Pass Through Agreement, the provisions of this Section
shall control.
(a) The Pass Through Trustee shall, in accordance with this
Article, execute, authenticate and deliver, one or more Registered Global
Certificates which (i) in the aggregate, shall represent, and shall be
denominated in an amount equal to, the aggregate Fractional Undivided Interests
of all of the Pass Through Certificates, (ii) shall be registered in the name
of the Depository or its nominee, (iii) shall be delivered by the Pass Through
Trustee to the Depository or pursuant to the Depository's instruction, and (iv)
shall bear a legend substantially to the following effect: "Unless this
Registered Global Certificate is presented by an authorized representative of
the Depository Trust Company, a New York corporation ("DTC"), to the Company or
its agent for registration of transfer, exchange or payment, and any Registered
Global Certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein."
(b) Notwithstanding any other provision of this Section or of
Section 2.08, the Registered Global Certificates may be transferred, in whole
but not in part and in the manner provided in Section 2.08, by the Depository
to a nominee of such Depository or by a nominee of such Depository to such
Depository or another nominee of such Depository or by such Depository or any
such nominee to a successor Depository selected or approved by the Company upon
notice to the Pass Through Trustee or to a nominee of such successor
Depository.
(c) The Depository shall be a clearing agency registered under
the Exchange Act and any other applicable statute or regulation.
17
<PAGE> 26
(d) If at any time the Depository notifies the Company that it is
unwilling or unable to continue as Depository or if at any time the Depository
shall no longer be eligible under subsection (c) above, and a successor
Depository is not appointed by the Company within 90 days after the Company
receives such notice or becomes aware of such condition, as the case may be,
this Section shall no longer be applicable to the Pass Through Certificates and
the Pass Through Trustee, upon the written request of the Company, will
execute, authenticate and deliver Pass Through Certificates in definitive
registered form without coupons, in authorized denominations, and in an
aggregate Fractional Undivided Interest equal to the Fractional Undivided
Interest of the Registered Global Certificates then outstanding in exchange for
such Registered Global Certificates. In addition, the Company may at any time
and in its sole discretion determine that the Pass Through Certificates shall
no longer be represented by a Registered Global Certificate and that the
provisions of this Section shall no longer apply to such Pass Through
Certificates. In such event the Pass Through Trustee, upon receipt of an
Officers' Certificate evidencing such determination by the Company, will notify
the Depository of the availability of such Pass Through Certificates in
definitive form and will execute, authenticate and deliver, Pass Through
Certificates in definitive registered form without coupons, in authorized
denominations and in an aggregate Fractional Undivided Interest equal to the
Fractional Undivided Interest of the Registered Global Certificates then
outstanding in exchange for such Registered Global Certificates. Upon the
exchange of the Registered Global Certificates for such Pass Through
Certificates in definitive registered form without coupons, in authorized
denominations, such Registered Global Certificates shall be cancelled by the
Pass Through Trustee. Such Pass Through Certificates in definitive registered
form issued in exchange for the Registered Global Certificates pursuant to this
subsection (d) shall be registered in such names and in such authorized
denominations as the Depository shall instruct the Pass Through Trustee. The
Pass Through Trustee shall deliver such Pass Through Certificates to the
Persons in whose names such Pass Through Certificates are so registered.
(e) As long as the Pass Through Certificates are represented by
Registered Global Certificates, all distributions shall be made to the holder
of such Registered Global Certificate as the Certificateholder, or to such
Persons as such holder may designate, by wire transfer of immediately available
funds on the date such distributions are due, and the Company shall or shall
cause the Pass Through Trustee to provide to the Depository any notices
referred to
18
<PAGE> 27
in the related Letter of Representations in accordance with such Letter of
Representations.
SECTION 2.13. Appointment of Authenticating Agent; Paying Agent
and Registrar. (a) The Pass Through Trustee may appoint an authenticating
agent (the "Authenticating Agent") with respect to the Pass Through
Certificates which shall be authorized to act on behalf of the Pass Through
Trustee to authenticate the Pass Through Certificates issued upon original
issue and upon exchange or registration of transfer thereof or pursuant to
Section 2.09 of this Pass Through Agreement. Pass Through Certificates so
authenticated shall be entitled to the benefits of this Pass Through Agreement
and shall be valid and obligatory for all purposes as if authenticated by the
Pass Through Trustee. Whenever reference is made in this Pass Through
Agreement to the authentication and delivery of Pass Through Certificates by
the Pass Through Trustee or the Pass Through Trustee's certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Pass Through Trustee by an Authenticating Agent and a
certificate of authentication executed on behalf of the Pass Through Trustee by
an Authenticating Agent.
ARTICLE III
CERTAIN REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 3.01. Representations, Warranties and Covenants of the
Company. (a) All of the representations and warranties of the Company set
forth or incorporated by reference in Section ____ of the Underwriting
Agreement are incorporated by reference in this Pass Through Agreement as if
set forth herein and the Company represents and warrants that such
representations and warranties are true and correct on the date hereof, except
to the extent that such representations and warranties expressly relate solely
to an earlier date or later date (in which case such representations and
warranties were correct on and as of such earlier date or will be correct on
and as of such later date, as the case may be).
(b) The Company will at all times, except as permitted under
subsection (c) below, maintain its existence as a corporation under the laws of
the State of Delaware, and maintain its good standing under the laws of the
State of Nevada and any other State of the United States in which the conduct
of its business or the ownership or leasing of assets
19
<PAGE> 28
used in its business requires such qualification and where the failure to be so
qualified would have a material adverse effect on the operations, business,
properties, assets or condition of the Company and its consolidated
subsidiaries taken as a whole, and will do or cause to be done all things
necessary to preserve and keep in full force and effect its rights (charter and
statutory) and franchises derived from or arising under Applicable Laws of the
United States or any state thereof; provided that the Company may discontinue
any non-material right or franchise, or discontinue any right or franchise if
its board of directors shall determine that such discontinuance is necessary or
desirable in the conduct of the Company's business and does not materially and
adversely affect the Company's ability to perform its obligations hereunder.
(c) The Company may consolidate or merge with another
corporation, or sell substantially all of its assets to another Person provided
that (i) after giving effect thereto, no event of default shall have occurred
and be continuing under any Lease, (ii) no default shall have occurred and be
continuing under Section 16(a)(1) or 16(5) of any Lease, (iii) in the case of
any transaction among Affiliates, after giving effect to such transaction, the
successor corporation shall (a) own all of the gold reserves and resources, and
the related mining equipment, theretofore owned by the Company, and (b) have no
material increase in liabilities in relation to the liabilities of the Company
immediately prior thereto, (iv) in the case of any transaction other than one
among Affiliates, after giving effect thereto, the successor corporation shall
have a Tangible Net Worth equal to or in excess of the Tangible Net Worth of
the Company immediately prior thereto, and (v) the Pass Through Trustee shall
receive from the successor corporation an agreement reasonably satisfactory in
form and substance to the Pass Through Trustee containing an effective
assumption by such successor corporation of the due and punctual performance
and observance of each covenant and condition to be performed or observed by
the Company hereunder.
(d) Upon any consolidation or merger, or any sale of
substantially all the assets of the Company as an entirety in accordance with
this Section, the successor corporation formed by such consolidation or the
Person into which the Company is merged or to which such sale is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Pass Through Agreement with the same effect as if such
successor corporation or such Person, as the case may be, had been named as the
Company herein and therein. No such sale of substantially all of the
20
<PAGE> 29
assets of the Company as an entirety shall have the effect of releasing the
Company or any successor corporation which shall theretofore have become such
in the manner prescribed in this Section from its liability hereunder.
(e) The Pass Through Trustee shall receive an Officer's
Certificate and an Opinion of Counsel of the Company as conclusive evidence
that any consolidation, merger, sale, lease or conveyance, and any assumption
complies with the provisions of this Section and the Pass Through Trustee shall
be entitled to rely upon the same for all purposes hereof.
SECTION 3.02. Offices for Payments; Registrar. So long as any
Pass Through Certificates remain outstanding, the Pass Through Trustee will
maintain the following: (a) an office or agency where the Pass Through
Certificates may be presented for payment and (b) a facility or agency in New
York, New York where such Pass Through Certificates may be presented or
surrendered for registration of transfer and for exchange and for redemption as
provided in this Pass Through Agreement (the "Registrar"). Written notice of
the location of each such other office or agency and of any change of location
thereof shall be given by the Pass Through Trustee to the Company, the Owner
Trustees, the Indenture Trustees and the Certificateholders. In the event that
no such office or agency shall be maintained or no such notice of location or
of change of location shall be given, presentations and demands may be made and
notices may be served at the Corporate Trust Office of the Pass Through
Trustee. The Registrar shall keep a register (the "Register") with respect to
the Pass Through Certificates and their transfer and exchange. The Pass
Through Trustee may appoint one or more co-registrars ("Co-Registrars") and may
terminate any such appointment at any time upon written notice. The term
"Registrar" includes any Co-Registrar.
Any Registrar shall be a bank or trust company organized and doing
business under the laws of the United States or any state, with a combined
capital and surplus of at least $100,000,000, or a direct or indirect
subsidiary of such an entity, or a member of a bank holding company group,
having a combined capital and surplus of at least $100,000,000 and such
subsidiary or member itself having a capital and surplus of at least
$10,000,000.
SECTION 3.03. Representations and Warranties of the Pass Through
Trustee. (a) The Pass Through Trustee, in its individual capacity (except
with respect to clause (iv) below), represents, warrants and agrees that:
21
<PAGE> 30
(i) it is a validly existing national banking association duly
organized under the laws of the United States of America, holding a valid
certificate to do business as a national banking association with banking
and trust powers and has the corporate power and authority to enter into
and perform its obligations under this Pass Through Agreement;
(ii) this Pass Through Agreement has been duly authorized by all
necessary corporate action on its part, and neither the execution and
delivery hereof nor its performance of any of the terms and provisions
hereof will violate any Federal law or regulation relating to its banking
or trust powers or contravene or result in any breach of, or constitute any
default under its articles of association or by-laws or the provisions of
any indenture, mortgage, contract or other agreement to which it is a party
or by which it or its properties may be bound or affected;
(iii) the execution, delivery and performance by the Pass Through Trustee
of this Pass Through Agreement will not require the authorization, consent,
or approval of, the giving of notice to, the filing or registration with,
or the taking of any other action in respect of, any United States or state
governmental authority or agency regulating the banking and corporate trust
activities of the Pass Through Trustee other than (i) the registration of
the Pass Through Certificates under the Securities Act and under the
securities laws of any state in which the Pass Through Certificates may be
offered for sale if the laws of such state require such action and (ii) the
qualification of the Pass Through Agreement under the Trust Indenture Act
pursuant to an order of the Securities and Exchange Commission; and
(iv) this Pass Through Agreement has been duly executed and delivered by
it and, assuming that this Pass Through Agreement is the legal, valid and
binding obligation of the Company, is the legal, valid and binding
obligation of the Pass Through Trustee, enforceable against the Pass
Through Trustee in accordance with its terms except as limited by
bankruptcy, insolvency, moratorium, reorganization, receivership,
fraudulent conveyance or similar laws or equitable principles of general
application to or affecting the enforcement of creditors' rights and
remedies generally from time to time in effect, regardless of whether such
enforceability is considered in a proceeding in equity or at law.
22
<PAGE> 31
(b) The representations and warranties set forth in subsection
(a) above shall be deemed to be made by the Pass Through Trustee on the
Issuance Date.
SECTION 3.04. Paying Agents. Whenever the Pass Through Trustee
in its sole discretion shall appoint a paying agent (the "Paying Agent") for
any Pass Through Trust, it will cause the Paying Agent to execute and deliver
an instrument in which the Paying Agent shall agree with the Pass Through
Trustee, subject to the provisions of this Section,
(a) that it will hold all sums received by it as such agent for
distribution to the Certificateholders (whether such sums have been paid to
it by the Pass Through Trustee or the Related Owner Trustee or Indenture
Trustee) in trust for the benefit of the Certificateholders or of the Pass
Through Trustee, and
(b) that it will notify the Pass Through Trustee if the principal
of or interest or premium on the Equipment Notes is not paid when the same
is due and payable.
Anything in this Section to the contrary notwithstanding, the
agreements to hold sums in trust as provided in this Section are subject to the
provisions of Sections 12.03 and 12.04 hereof.
SECTION 3.05. No Representations or Warranties as to Documents.
The Pass Through Trustee neither makes nor shall be deemed to have made any
representation or warranty as to the validity, legality or enforceability of
this Pass Through Agreement, any Pass Through Certificates or any related
Indenture Documents or as to the correctness of any statement contained in any
thereof, except for the representations and warranties of the Pass Through
Trustee made in its individual capacity under this Pass Through Agreement or in
any Participation Agreement.
SECTION 3.06. Payments from Trust Property Only. All payments to
be made by the Pass Through Trustee under the Pass Through Trust shall be made
only from the income and the proceeds from the Trust Property and only to the
extent that the Pass Through Trustee shall have sufficient income or proceeds
from such Trust Property to enable the Pass Through Trustee to make
distributions of the amounts due in respect of the Pass Through Certificates.
Each Certificateholder by its acceptance of a Pass Through Certificate agrees
that it will look solely to the income and proceeds from the Trust Property to
the extent available for distribution to it as provided herein and that the
Pass Through Trustee is not personally
23
<PAGE> 32
liable to such Certificateholder for any amounts payable under the Pass Through
Trust except as expressly provided herein.
SECTION 3.07. Limitation of the Company's Liability. The Company
is a party to this Pass Through Agreement solely for purposes of meeting the
requirements of the Trust Indenture Act, and therefore shall not be liable
hereunder, except as otherwise expressly provided herein or under the Pass
Through Certificates, except as otherwise expressly provided therein.
ARTICLE IV
CERTIFICATEHOLDER LISTS AND REPORTS BY THE
COMPANY AND THE PASS THROUGH TRUSTEE
SECTION 4.01. Certificateholder Lists; Ownership of Pass Through
Certificates. (a) The Pass Through Trustee shall preserve in as current a
form as is reasonably practicable the most recent list available to it of the
names and addresses of the Certificateholders. If the Pass Through Trustee is
not the Registrar, the Company shall cause the Registrar to furnish to the Pass
Through Trustee semi-annually not more than 15 days after each Record Date, as
of such Record Date, or at such other times as the Pass Through Trustee may
request in writing, a list, in such form and as of such date as the Pass
Through Trustee may reasonably require, containing all the information in the
possession or control of the Registrar as to the names and addresses of the
Certificateholders and the amounts of the Pass Through Certificates held by
such Certificateholders.
(b) Ownership of the Pass Through Certificates shall be proved by
the Register kept by the Registrar.
SECTION 4.02. Disclosure of Certificateholder Lists. Each and
every Certificateholder, by receiving and holding such Pass Through
Certificate, agrees with the Company and the Pass Through Trustee that neither
the Company, the Pass Through Trustee, the Pass Through Trustee in its
individual capacity nor any agent of any of the foregoing shall be held
accountable by reason of the disclosure of any such information as to the names
and addresses of any Certificateholders in accordance with the provisions of
Section 312 of the Trust Indenture Act, regardless of the source from which
such information was derived, and that the Pass Through Trustee shall not be
held accountable by reason
24
<PAGE> 33
of mailing any material pursuant to a request made under Section 312(b) of the
Trust Indenture Act.
SECTION 4.03. Reports by the Company. The Company covenants:
(a) to file with the Pass Through Trustee, within 30 days after
the Company is required to file the same with the Commission, copies of the
annual reports and of the information, documents, and other reports (or
copies of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) which the Company may be
required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act or, if the Company is not required to file information,
documents, or reports pursuant to either of such Sections of the Exchange
Act, then to file with the Pass Through Trustee and the Commission, in
accordance with rules and regulations prescribed from time to time by the
Commission, such of the supplementary and periodic information, documents,
and reports that would be required pursuant to Section 13 of the Exchange
Act, or, in respect of a security listed and registered on a national
securities exchange, as may be prescribed from time to time in such rules
and regulations;
(b) to file with the Pass Through Trustee and the Commission, in
accordance with rules and regulations prescribed from time to time by the
Commission, such additional information, documents, and reports with
respect to compliance by the Company with the conditions and covenants
provided for in this Pass Through Agreement as may be required from time to
time by such rules and regulations;
(c) to transmit to the Certificateholders in the manner and to
the extent required by Section 313(c) of the Trust Indenture Act, within 30
days after the filing thereof with the Pass Through Trustee, such summaries
of any information, documents and reports required to be filed by the
Company pursuant to subsections (a) and (b) of this Section 4.03 as may be
required by rules and regulations prescribed from time to time by the
Commission; and
(d) furnish to the Pass Through Trustee, on or before each March
15, a brief certificate from the principal executive officer, principal
financial officer or principal accounting officer of the Company as to his
or her knowledge of such Company's compliance with all
25
<PAGE> 34
conditions and covenants under this Pass Through Agreement; provided, that
for purposes of this subsection (d), such compliance shall be determined
without regard to any period of grace or requirement of notice provided
under this Pass Through Agreement; and
(e) to furnish to the Pass Through Trustee, from time to time,
such other financial information as the Pass Through Trustee may reasonably
request.
SECTION 4.04. Reports by the Pass Through Trustee. On or before
each May 15, the Pass Through Trustee shall transmit, in the manner and to the
extent required by Section 313(c) of the Trust Indenture Act, any report
required by Section 313(a) of the Trust Indenture Act to be transmitted by the
Pass Through Trustee to the Certificateholders.
ARTICLE V
RECEIPT AND DISTRIBUTION OF INCOME
AND PROCEEDS FROM THE TRUST PROPERTY
SECTION 5.01. Distribution Dates. The Regular Distribution Dates
are ___________ and ___________, commencing on ___________. The Special
Distribution Date for any month in which a Special Payment is to be distributed
will be the twenty-eighth day of such month, except that the Special
Distribution Date for any Special Payment received by the Pass Through Trustee
in connection with a prepayment of any Equipment Note pursuant to Section 2.14
of the related Indenture will correspond to the date of the receipt of such
Special Payment by the Pass Through Trustee. Notice of such Special Payment
shall be mailed as soon as practicable after receipt by the Pass Through
Trustee of the notice of such prepayment.
SECTION 5.02. Record Dates. The Record Dates for the Regular
Distribution Dates are ____________ and ____________, respectively, and the
Record Date for any Special Distribution Date is the fifteenth day preceding
such Special Distribution Date, in any event, whether or not such date is a
Business Day.
SECTION 5.03. Certificate Account and Special Payments Account.
(a) The Pass Through Trustee shall establish and maintain, on behalf of the
Certificateholders, a Certificate Account as one or more non-interest bearing
accounts designated by the Pass Through Trustee to be used for
26
<PAGE> 35
the purposes set out in this Section 5.03(a). The Pass Through Trustee shall
hold the Certificate Account in trust for the benefit of the
Certificateholders, and shall make or permit withdrawals therefrom only as
provided in this Pass Through Agreement. Upon receipt of any Scheduled
Payment, the Pass Through Trustee shall immediately deposit such Scheduled
Payment in the Certificate Account.
(b) The Pass Through Trustee shall establish and maintain, as and
when required, on behalf of the Certificateholders, a Special Payments Account
as one or more separate accounts designated by the Pass Through Trustee to be
used for the purposes set out in this Section 5.03(b), which shall be
non-interest bearing except as provided in Section 5.06. The Pass Through
Trustee shall hold such Special Payments Account in trust for the benefit of
the Certificateholders, and shall make or permit withdrawals therefrom only as
provided in this Pass Through Agreement. Upon receipt of any Special Payment,
the Pass Through Trustee shall immediately deposit such Special Payment in the
applicable Special Payments Account.
(c) The Pass Through Trustee shall present any Equipment Note to
the Related Indenture Trustee on the date of its stated final maturity, or on
such earlier date as such Equipment Note is to be redeemed or purchased in
whole pursuant to the relevant Indenture.
SECTION 5.04. Distributions from Certificate Account and Special
Payments Account. (a) On each Regular Distribution Date, or as soon
thereafter as the Pass Through Trustee has confirmed receipt of any Scheduled
Payment due on the Equipment Notes on such Regular Distribution Date, the Pass
Through Trustee shall distribute out of the Certificate Account the entire
amount deposited therein pursuant to Section 5.03(a) by paying to each
Certificateholder of record at the close of business on the Record Date for
such Regular Distribution Date (except as provided in Section 12.01 concerning
the final distribution), at the address for such Certificateholder appearing in
the Register, such Certificateholder's pro rata share (based on the aggregate
Fractional Undivided Interest held by such Certificateholder) of the aggregate
amount in the Certificate Account.
(b) On each Special Distribution Date, or as soon thereafter as
the Pass Through Trustee has confirmed receipt of any Special Payment due on
the Equipment Notes or realized upon the sale of any such Equipment Notes, the
Pass Through Trustee shall distribute out of the Special Payments Account the
entire amount of such Special Payment deposited therein
27
<PAGE> 36
pursuant to Section 5.03(b) by paying to each Certificateholder of record at
the close of business on the Record Date for such Special Distribution Date
(except as provided in Section 12.01 concerning the final distribution), at the
address for such Certificateholder appearing in the Register, such
Certificateholder's pro rata share (based on the aggregate Fractional Undivided
Interest held by such Certificateholder) of the aggregate amount in the Special
Payments Account on account of such Special Payment.
(c) The Pass Through Trustee shall at the expense of the Company
notify each Certificateholder by mail at its address as it appears in the
Register of each Special Payment. If the Equipment Notes are to be redeemed or
purchased in whole prior to their maturities, such notice shall be mailed not
less than 20 days prior to the date any such Special Payment is scheduled to be
distributed. For any other Special Payment, such notice shall be mailed as
soon as practicable after the Pass Through Trustee has received funds for such
Special Payment. Such notices of Special Payments shall set forth:
(i) the Special Distribution Date and the Record Date therefor
(except as otherwise provided in Section 12.01);
(ii) the amount of the Special Payment for each $1,000 face amount
Pass Through Certificate and the amount thereof constituting principal,
premium, if any, and interest on the Equipment Notes;
(iii) the reason for the Special Payment; and
(iv) if the Special Distribution Date is the same date as a Regular
Distribution Date, the total amount to be received on such date for each
$1,000 face amount Pass Through Certificate.
If the amount of premium, if any, payable upon the redemption or purchase in
whole of an Equipment Note has not been calculated at the time that the Pass
Through Trustee mails the notice of the related Special Payment, it shall be
sufficient if the notice sets forth the other amounts to be distributed and
states that any premium received will also be distributed.
If any cancellable redemption of the Equipment Notes is cancelled,
the Pass Through Trustee, as soon as possible after learning thereof, shall, at
the expense of the Company, notify by mail each Certificateholder at its
address as it appears on the Register.
28
<PAGE> 37
(d) Any Scheduled Payment or Special Payment to be distributed
pursuant to this Article shall be payable at the Corporate Trust Office of the
Pass Through Trustee or at any office or agency maintained for such purpose
pursuant to Section 3.02, provided that any Scheduled Payment or Special
Payment may be payable at the option of the Pass Through Trustee or its Paying
Agent by mailing checks for such Scheduled Payment or Special Payment payable
to or upon the written order of the Certificateholders entitled thereto as they
appear on the Register.
SECTION 5.05. Statements to Certificateholders. (a) On each
Regular Distribution Date and Special Distribution Date, the Pass Through
Trustee shall include with each distribution to Certificateholders a statement,
giving effect to such distribution to be made on such Regular Distribution Date
or Special Distribution Date, as the case may be, setting forth the following
information (as to (i) and (ii) below, for each $1,000 face amount Pass Through
Certificate):
(i) The amount of such distribution allocable to principal and
the amount allocable to premium, if any, on the Equipment Notes;
(ii) The amount of such distribution allocable to interest on the
Equipment Notes; and
(iii) The Pool Balance and the Pool Factor of the Pass Through
Trust.
(b) Within a reasonable period of time after the end of each
calendar year but not later than the latest date permitted by law, the Pass
Through Trustee shall furnish to each Person who at any time during such
calendar year was a Certificateholder a statement containing the sum of the
amounts determined pursuant to clauses (a)(i) and (a)(ii) of this Section for
the Pass Through Trust for such calendar year or, in the event such Person was
a Certificateholder during a portion of such calendar year, for the applicable
portion of such year.
SECTION 5.06. Investment of Special Payment Moneys. Any money
received by the Pass Through Trustee pursuant to Section 5.03(b) representing a
Special Payment that is not to be promptly distributed shall, to the extent
practicable, be invested by the Pass Through Trustee in Permitted Investments
as directed in writing by the Company pending distribution of such Special
Payment pursuant to Section 5.04. Any investment made pursuant to this Section
5.06 shall be in such Permitted
29
<PAGE> 38
Investments having maturities not later than the date that such moneys are
required to be used to make the payment required under Section 5.04 on the
applicable Special Distribution Date and the Pass Through Trustee shall hold
any such Permitted Investments until maturity. The proceeds upon maturity of
any Permitted Investment shall not be reinvested pending distribution. The
Pass Through Trustee, when authorized by the Company, may trade with itself in
the purchase and sale of securities for such investment. The Pass Through
Trustee shall have no liability with respect to any investment made pursuant to
this Section, other than by reason of the willful misconduct or gross
negligence of the Pass Through Trustee. All income and earnings from such
investments shall be distributed on such Special Distribution Date as part of
such Special Payment. Although the Company recognizes that it may obtain a
broker confirmation or written statement containing comparable information at
no additional cost, the Company hereby agrees that confirmations of investments
made by the Pass Through Trustee pursuant to the Section 5.06 are not required
to be issued by the Pass Through Trustee for each month in which a monthly
statement is rendered. No such statement need be rendered pursuant to the
provisions hereof if no activity occurred in the fund or account during such
preceding month.
SECTION 5.07. Withholding Taxes. The Pass Through Trustee shall
withhold any taxes required to be withheld on payments to any
Certificateholder, except to the extent that such Certificateholder has
furnished evidence reasonably satisfactory to the Pass Through Trustee of any
exemption from withholding claimed by such Certificateholder, and under no
circumstances shall the failure of any such Certificateholder to receive any
amounts so withheld constitute an Event of Default.
ARTICLE VI
CONCERNING THE CERTIFICATEHOLDERS
SECTION 6.01. Evidence of Action Taken by Certificateholders. (a)
Any request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Pass Through Agreement to be given or taken by
Certificateholders may be embodied in and evidenced by one or more
substantially similar instruments signed by such Certificateholders in person
or by an agent duly appointed in writing, and, except as otherwise expressly
provided herein, such action shall become effective when such instrument or
30
<PAGE> 39
instruments are delivered to the Pass Through Trustee. Proof of execution of
any instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Pass Through Agreement and (subject to Sections 8.02
and 8.03) conclusive in favor of the Pass Through Trustee, if made in the
manner provided in this Article.
(b) For the purpose of determining the Certificateholders
entitled to vote or consent to any direction, waiver or other action of such
Certificateholders under Section 7.10 or 7.11, the Company may set a record
date for such vote or consent by specifying such record date in an Officer's
Certificate delivered to the Pass Through Trustee. Notwithstanding Section
316(c) of the Trust Indenture Act, such record date shall be a date not more
than 15 days prior to the first solicitation of such vote or consent.
SECTION 6.02. Proof of Execution of Instruments and of Holding of
Certificates. Subject to Sections 8.02 and 8.03, the execution of any
instrument by a Certificateholder or his agent or proxy may be proved in
accordance with such reasonable rules and regulations as may be prescribed by
the Pass Through Trustee. The holding of Pass Through Certificates shall be
proved by the Register or by a certificate of the Registrar.
SECTION 6.03. Certificateholders to Be Treated as Owners. Prior
to due presentment for registration of transfer of any Pass Through
Certificate, each Indenture Trustee, the Pass Through Trustee, any agent of any
Indenture Trustee or the Pass Through Trustee, the Paying Agent, the Registrar
and the Company may deem and treat the Person in whose name such Pass Through
Certificate shall be registered upon the Register as the absolute owner of such
Pass Through Certificate (whether or not such Pass Through Certificate shall be
overdue and notwithstanding any notation of ownership or other writing thereon)
for the purpose of receiving payment on account of the principal payable with
respect to and, subject to the provisions of this Pass Through Agreement,
interest payable with respect to such Pass Through Certificate and for all
other purposes; and neither any Indenture Trustee nor the Pass Through Trustee
(nor any agent of any Indenture Trustee or the Pass Through Trustee) nor the
Paying Agent nor the Registrar nor the Company shall be affected by any notice
to the contrary. All such payments so made to any such person, or upon his
order, shall be valid, and, to the extent of the sum or sums so paid, effectual
to satisfy and discharge the liability for moneys payable upon any such Pass
Through Certificate.
31
<PAGE> 40
SECTION 6.04. Pass Through Certificates Owned by the Company and
Related Owner Trustees Deemed Not Outstanding. In determining whether the
Certificateholders of the requisite aggregate Fractional Undivided Interest
have concurred in any direction, consent or waiver under this Pass Through
Agreement, Pass Through Certificates that are owned by the Company, any Related
Owner Trustee or Related Owner Participant or any obligor on such Pass Through
Certificates or by any Affiliate of the Company, any such Related Owner Trustee
or Related Owner Participant or any obligor on such Pass Through Certificates
shall be disregarded and deemed not to be Outstanding for the purpose of any
such determination; provided that for the purpose of determining whether the
Pass Through Trustee shall be protected in relying on any such direction,
consent or waiver, only if a Responsible Officer of the Pass Through Trustee
has actual knowledge that certain Pass Through Certificates are so owned shall
such Pass Through Certificates be so disregarded; and provided further that if
all Pass Through Certificates that would be deemed Outstanding in the absence
of the foregoing provision are owned by either (i) any Related Owner Trustee
or Affiliate thereof or Related Owner Participant or Affiliate thereof or (ii)
any combination of the foregoing, then such Pass Through Certificates shall be
deemed Outstanding for the purpose of any such determination. Pass Through
Certificates so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Pass Through
Trustee the pledgee's right so to act with respect to such Pass Through
Certificates and that the pledgee is not the Company, any Related Owner Trustee
or Related Owner Participant or any obligor upon the Pass Through Certificates
or any Affiliate of the Company, any Related Owner Trustee or Related Owner
Participant or any obligor on such Pass Through Certificates. In case of a
dispute as to such right, the advice of counsel shall be full protection in
respect of any decision made by the Pass Through Trustee in accordance with
such advice. Upon request of the Pass Through Trustee, the Company shall, and
shall request the Related Owner Trustees and the Related Owner Participants to,
furnish to the Pass Through Trustee promptly an Officers' Certificate listing
and identifying all Pass Through Certificates, if any, known by the Company or
any such Related Owner Trustee or Related Owner Participant to be owned or held
by or for the account of any of the above-described persons; and the Pass
Through Trustee shall be entitled to accept such Officers' Certificates as
conclusive evidence of the facts set forth therein and of the fact that all
Pass Through Certificates not listed therein are Outstanding for the purpose of
any such determination. For the purpose of determining whether Pass Through
Certificates are Outstanding as described in this Section, an "obligor" on such
Pass
32
<PAGE> 41
Through Certificates shall include any obligor or any Affiliate of any such
obligor on any Equipment Notes that constitute Trust Property.
SECTION 6.05. Right of Revocation of Action Taken. At any time
prior to (but not after) the evidencing to the Pass Through Trustee, as
provided in Section 6.01, of any action taken by the Certificateholders of the
percentage in aggregate of Fractional Undivided Interests specified in this
Pass Through Agreement in connection with such action, any Certificateholder of
a Pass Through Certificate, the serial number of which is shown by the evidence
to be included among the serial numbers of the Pass Through Certificates, the
Certificateholders of which have consented to such action, may, by filing
written notice at the Corporate Trust Office and upon proof of holding as
provided in this Article, revoke such action so far as concerns such Pass
Through Certificate. Except as aforesaid, any such action taken shall be
conclusive and binding upon such Certificateholder for such Pass Through
Certificate and upon all future Certificateholders and owners of such Pass
Through Certificate and of any Pass Through Certificates issued in exchange or
substitution therefor, irrespective of whether or not any notation in regard
thereto is made upon any such Pass Through Certificate or otherwise. Any
action taken by such Certificateholders of the percentage in aggregate of
Fractional Undivided Interests specified in this Pass Through Agreement in
connection with such action shall be conclusively binding upon the Pass Through
Trustee and all the Certificateholders.
SECTION 6.06. ERISA Plan Prohibition. No employee benefit plan
subject to Part 4 of Subtitle B of Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or plan subject to Section 4975 of
the Code or any trust created under any such employee benefit plan or plan, nor
any governmental plan (as defined in Section 3(32) of ERISA or Section 414(d)
of the Code) organized in a jurisdiction having prohibitions on transactions
with such governmental plan similar to those contained in Section 406 of ERISA
or Section 4975 of the Code (such employee benefit plan, plan and governmental
plan are hereinafter collectively referred to as an "ERISA Plan"), or any
Person treated as holding assets of an ERISA Plan may acquire or hold the Pass
Through Certificates. The purchase by any person of any Pass Through
Certificate constitutes a representation by such Person to the Company, the
Related Owner Participants, the Related Owner Trustees, the Related Indenture
Trustees and the Pass Through Trustee that such Person is not an ERISA Plan and
that such Person is not acquiring, and has not acquired, such Pass Through
Certificate with assets of an ERISA Plan.
33
<PAGE> 42
ARTICLE VII
REMEDIES OF PASS THROUGH TRUSTEE
AND CERTIFICATEHOLDERS
SECTION 7.01. Events of Default. If an Indenture Event of
Default under an Indenture relating to any Equipment Note that constitutes
Trust Property (an "Event of Default") shall occur and be continuing, then, and
in each and every case, the Pass Through Trustee may vote all of the Equipment
Notes under such Indenture, and upon the direction of the Majority In Interest
of Certificateholders, the Pass Through Trustee shall vote a corresponding
majority of such Equipment Notes in favor of directing the Related Indenture
Trustee to declare the unpaid principal of such Equipment Notes then
outstanding, together with interest accrued but unpaid thereon and all other
amounts due under such Equipment Notes and the related Indenture, to be due and
payable under, and in accordance with the provisions of, such Indenture. In
addition, if such Event of Default shall have occurred and be continuing, the
Pass Through Trustee may in accordance with such related Indenture vote such
Equipment Notes to direct the Related Indenture Trustee regarding the exercise
of remedies provided in such Indenture.
If an Event of Default shall have occurred and be continuing, the
Pass Through Trustee also may in its discretion, and upon the direction of the
Majority In Interest of Certificateholders shall, by such officer or agent as
it may appoint, sell, convey, transfer and deliver any Equipment Notes held in
such Pass Through Trust that are subject to the corresponding Indenture Event
of Default, without recourse to or warranty by the Pass Through Trustee or any
Certificateholder, to any Person. In any such case, the Pass Through Trustee
shall sell, assign, contract to sell or otherwise dispose of and deliver any
such Equipment Notes in one or more parcels at public or private sale or sales,
at any location or locations at the option of the Pass Through Trustee, all
upon such terms and conditions as it may reasonably deem advisable and at such
prices as it may reasonably deem advisable, for cash. If the Pass Through
Trustee so decides or is required to sell or otherwise dispose of any Equipment
Notes pursuant to this Section, the Pass Through Trustee shall take such of the
actions described above as it may reasonably deem most effective to complete
the sale or other disposition of such Equipment Notes, so as to provide for the
payment in full of all amounts due on such Equipment Notes. Notwithstanding
the foregoing, any action taken by the Pass Through Trustee under this Section
shall not, in the
34
<PAGE> 43
reasonable judgment of the Pass Through Trustee, be adverse to the best
interests of the Certificateholders.
SECTION 7.02. Incidents of Sale of Equipment Notes. Upon any
sale of all or any part of the Equipment Notes made either under the power of
sale given under this Pass Through Agreement or otherwise for the enforcement
of this Pass Through Agreement, the following shall be applicable:
(1) Any Certificateholder, the Pass Through Trustee in its
individual or any other capacity or any other Person may bid for and
purchase any of such Equipment Notes, and upon compliance with the terms of
sale, may hold, retain, possess and dispose of such Equipment Notes in its
or their own absolute right without further accountability.
(2) The receipt of the Pass Through Trustee or of the officer
making such sale shall be a sufficient discharge to any purchaser for his
purchase money, and, after paying such purchase money and receiving such
receipt, such purchaser or its personal representative or assigns shall not
be obliged to see to the application of such purchase money, or be in any
way answerable for any loss, misapplication or non-application thereof.
(3) Any moneys collected by the Pass Through Trustee upon any
sale made either under the power of sale given by this Pass Through
Agreement or otherwise for the enforcement of the Pass Through Trust, shall
be deposited and distributed as a Special Payment as provided in Article V.
SECTION 7.03. Pass Through Trustee May Prove Debt. If any amount
payable under any Equipment Note held by any Pass Through Trust is not paid
when due and payable, the Pass Through Trustee, in its own name and as trustee
of an express trust, as holder of such Equipment Note shall be, to the extent
permitted by and in accordance with the terms of the related Indenture
Documents, entitled and empowered to institute any action or proceedings at law
or in equity for the collection of the sums so due and unpaid, and may
prosecute any such action or proceedings to judgment or final decree, and may
enforce any such judgment or final decree against the applicable Owner Trustee
or other obligor upon such Equipment Note and collect in the manner provided by
law out of the property of such Owner Trustee or such other obligor upon such
Equipment Note, as the case may be, wherever situated, the moneys adjudged or
decreed to be payable.
35
<PAGE> 44
All rights of action and of asserting claims under this Pass
Through Agreement, or under any of the Pass Through Certificates, may be
prosecuted and enforced by the Pass Through Trustee without the possession of
any of such Pass Through Certificates or the production thereof in any trial or
other proceedings relative thereto, and any such action or proceedings
instituted by the Pass Through Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment, subject to the
payment of the expenses, disbursements and compensation of the Pass Through
Trustee, each predecessor Pass Through Trustee and their respective agents and
attorneys, shall be for the ratable benefit of the Certificateholders.
In any proceedings brought by the Pass Through Trustee (and also
any proceedings involving the interpretation of any provision of this Pass
Through Agreement) the Pass Through Trustee shall be held to represent all the
Certificateholders, and it shall not be necessary to make any such
Certificateholders parties to any such proceedings.
SECTION 7.04. Remedies Cumulative. Each and every right, power
and remedy given to the Pass Through Trustee specifically or otherwise under
the Pass Through Trust shall be cumulative and shall be in addition to every
other right, power and remedy specifically given thereunder or now or hereafter
existing at law, in equity or by statute, and each and every right, power and
remedy whether specifically given thereunder or otherwise existing may be
exercised from time to time and as often and in such order as may be deemed
expedient by the Pass Through Trustee or the Certificateholders, and the
exercise or the beginning of the exercise of any power or remedy shall not be
construed to be a waiver of the right to exercise at the same time or
thereafter any other right, power or remedy. No delay or omission by the Pass
Through Trustee or of any Certificateholder in the exercise of any right,
remedy or power or in the pursuance of any remedy shall impair any such right,
power or remedy or be construed to be a waiver of any default on the part of
the applicable Owner Trustee or the Company, as the case may be, or to be an
acquiescence therein.
SECTION 7.05. Suits for Enforcement. If an Indenture Event of
Default has occurred, has not been waived and is continuing, the Pass Through
Trustee may in its discretion and subject to its rights of appropriate
indemnification under Sections 7.07 and 8.03 and Article IX hereof, to the
extent permitted by and in accordance with the Indenture Documents, proceed to
protect and enforce its rights and rights of the Certificateholders by such
appropriate
36
<PAGE> 45
judicial proceedings as the Pass Through Trustee shall deem most effectual to
protect and enforce any of such rights, either at law or in equity or in
bankruptcy or otherwise, whether for the specific enforcement of any covenant
or agreement under the Pass Through Trust or in aid of the exercise of any
power granted thereunder or to enforce any other legal or equitable right
vested in the Pass Through Trustee or the Certificateholders under such Pass
Through Trust or by law; provided that any sale of any portion of the Trust
Property shall be done in accordance with Section 7.02.
SECTION 7.06. Discontinuance of Proceedings. If the Pass Through
Trustee or any Certificateholder institutes any proceeding to enforce any
right, power or remedy under the Pass Through Trust, and such proceeding is
discontinued or abandoned for any reason or is determined adversely to the Pass
Through Trustee or such Certificateholder, then and in every such case the
applicable Owner Trustee and the applicable Indenture Trustee, the Pass Through
Trustee, the Certificateholders and the Company shall, subject to any
determination in such proceeding, be restored to their former positions and
rights under the Pass Through Trust with respect to the Trust Property and all
rights, remedies and powers of the Pass Through Trustee and the
Certificateholders shall continue as if no such proceeding had been instituted.
SECTION 7.07. Limitations on Suits by Certificateholders. No
Certificateholder shall have any right by virtue or by availing of any
provision of the Pass Through Trust to institute any action or proceeding at
law or in equity or in bankruptcy or otherwise upon or under or with respect to
the Pass Through Trust, or for the appointment of a trustee, receiver,
liquidator, custodian or other similar official or for any other remedy
thereunder, unless such Certificateholder previously has notified the Pass
Through Trustee in writing of an Event of Default and of the continuance
thereof, as provided herein, and the Certificateholders of the Pass Through
Certificates then Outstanding (or the proxy therefor) representing in the
aggregate not less than 25% of the Fractional Undivided Interests of Pass
Through Certificates then Outstanding have requested in writing that the Pass
Through Trustee institute such action or proceedings in its own name as trustee
under the Pass Through Trust and have offered to the Pass Through Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Pass Through Trustee for
60 days after its receipt of such notice, request and offer of indemnity has
failed to institute any such action or proceedings and no direction
inconsistent with such written request has been
37
<PAGE> 46
given to the Pass Through Trustee pursuant to Section 7.10; it being understood
and intended, and being expressly covenanted by such Certificateholder with
every other Certificateholder and the Pass Through Trustee, that no one or more
Certificateholders shall have any right in any manner whatever to affect,
disturb or prejudice the rights of any other Certificateholder or to obtain or
seek to obtain priority over or preference to any other Certificateholder or to
enforce any right under the Pass Through Trust, except in the manner provided
therein and for the equal, ratable and common benefit of all
Certificateholders. For the protection and enforcement of the provisions of
this Section, each and every Certificateholder and the Pass Through Trustee
shall be entitled to such relief as can be given either at law or in equity.
SECTION 7.08. Unconditional Right of Certificateholders to
Receive Principal, Interest and Premium, and to Institute Certain Suits.
Notwithstanding any other provision in this Pass Through Agreement or any Pass
Through Certificate, the right of any Certificateholder to receive
distributions of Scheduled Payments or Special Payments pursuant to Article V
on or after the respective due dates set forth herein, or, subject to Section
7.07, to institute suit for the enforcement of any such distribution on or
after such respective dates as provided herein, shall not be impaired or
affected without the consent of such Certificateholder. The purchase by any
Certificateholder of any Pass Through Certificate constitutes the consent of
such Certificateholder to the retention by the Pass Through Trustee of certain
amounts otherwise distributable to such Certificateholder in accordance with
Section 5.07.
SECTION 7.09. Control by Certificateholders. A Majority In
Interest of Certificateholders has the right to direct the Pass Through Trustee
as to the time, method, and place of conducting any proceeding for any remedy
available to the Pass Through Trustee, or exercising any trust or power
conferred on the Pass Through Trustee under the Pass Through Trust; provided
that such direction is not otherwise than in accordance with law and the
provisions of the Pass Through Trust and the Pass Through Trustee has received,
to the extent provided in Sections 7.07 and 8.03 and Article IX hereof, such
reasonable indemnification as it may require against the costs, expenses and
liabilities to be incurred by the Pass Through Trustee; and provided further
that the Pass Through Trustee has the right to decline to follow any such
direction if the Pass Through Trustee, being advised by counsel, determines
that the action or proceeding so directed may not lawfully be taken or if the
Pass Through Trustee in good faith
38
<PAGE> 47
by its board of directors, the executive committee, or a trust committee of
directors or Responsible Officers of the Pass Through Trustee determines that
the action or proceedings so directed would involve the Pass Through Trustee in
personal liability or if the Pass Through Trustee in good faith so determines
that the actions or forebearances specified in or pursuant to such direction
would be unduly prejudicial to the interests of the Certificateholders not
joining in the giving of said direction, it being understood that the Pass
Through Trustee shall have no duty to ascertain whether or not such actions or
forebearances are unduly prejudicial to such Certificateholders.
Nothing in this Pass Through Agreement shall impair the right of
the Pass Through Trustee in its discretion to take any action deemed proper by
the Pass Through Trustee and which is not inconsistent with such direction by
Certificateholders.
SECTION 7.10. Waiver of Past Events of Default. Upon written
instructions from a Majority in Interest of Certificateholders, the Pass
Through Trustee shall waive any past Event of Default and its consequences and
upon such waiver such Event of Default will cease to exist and any Event of
Default arising therefrom will be deemed to have been cured for every purpose
of the Pass Through Trust, but no such waiver will extend to any subsequent or
other Event of Default thereunder or impair any right consequent thereon;
provided that any such waiver will be effective to waive any such past Event of
Default and its consequences as described above if, but only if, the
correlative Indenture Event of Default has been waived under the related
Indenture by the requisite holders of the Equipment Notes outstanding
thereunder; and provided further that in the absence of written instructions
from all Certificateholders (or the proxy therefor), the Pass Through Trustee
shall not waive any Event of Default (i) consisting of the failure to pay any
principal of, or premium (if any), or interest on, or other amounts due under,
any Equipment Note and the consequent failure to distribute any related
Scheduled Payment or Special Payment pursuant to Article V on or after the
respective due date therefor set forth herein or (ii) in respect of a covenant
or provision under the Pass Through Trust that, under Article XI hereof, cannot
be modified or amended without the consent of each Certificateholder (or the
proxy therefor).
SECTION 7.11. Notice of Pass Through Defaults. The Pass Through
Trustee shall, in the manner and to the extent required by Section 313(c) of
the Trust Indenture Act, notify the Certificateholders of all Pass Through
Defaults actually
39
<PAGE> 48
known to a Responsible Officer of the Pass Through Trustee, unless such Pass
Through Defaults have been cured before the giving of such notice; provided
that, except in the case of the failure to pay any principal of or interest on
or any other amount due under any of the Equipment Notes and the consequent
failure to distribute any related Scheduled Payment or Special Payment pursuant
to Article V on or after the respective due date therefor set forth herein, the
Pass Through Trustee shall be protected in withholding such notice if and so
long as the board of directors, the executive committee, or a trust committee
of directors or trustees or Responsible Officers of the Pass Through Trustee in
good faith determines that the withholding of such notice is in the interests
of the Certificateholders.
ARTICLE VIII
CONCERNING THE PASS THROUGH TRUSTEE
SECTION 8.01. Acceptance by Pass Through Trustee. The Pass
Through Trustee hereby acknowledges its acceptance of all right, title and
interest in and to the Equipment Notes acquired as Trust Property pursuant to
the applicable Participation Agreements and Section 2.02, and declares that the
Pass Through Trustee holds and will hold such right, title, and interest,
together with all other property constituting the Trust Property, for the
benefit of all then present and future Certificateholders, upon the trusts set
forth in the Pass Through Trust.
SECTION 8.02. Pass Through Trustee's Liens. The Pass Through
Trustee agrees that it will, in its individual capacity and at its own cost and
expense (but without any right of indemnity in respect of any such cost or
expense under Article IX hereof) promptly take such action as may be necessary
to duly discharge all Liens on any part of the Trust Property that result from
claims against it in its individual capacity not related to the administration
of such Trust Property or any other transaction pursuant to this Pass Through
Agreement.
SECTION 8.03. Certain Rights of the Pass Through Trustee.
Subject to Section 315 of the Trust Indenture Act:
(a) the Pass Through Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution, Officers' Certificate
or any other certificate, statement, instrument, opinion, report,
40
<PAGE> 49
notice, request, consent, order, bond, debenture, note, coupon, security or
other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(b) any request of any Related Indenture Trustee or Related Owner
Trustee in connection with the Pass Through Trust shall be sufficiently
evidenced by an Officers' Certificate (unless other evidence in respect
thereof is specifically prescribed herein) upon which the Pass Through
Trustee may rely to prove or establish a matter set forth therein;
(c) the Pass Through Trustee may consult with counsel and any
advice or Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be taken
by it hereunder in good faith and in accordance with such advice or Opinion
of Counsel;
(d) the Pass Through Trustee shall not be obligated to exercise
any of the trusts or powers vested in it at the request, order or direction
of the Certificateholders in accordance with the provisions thereof, unless
such Certificateholders have offered to the Pass Through Trustee reasonable
security or indemnity against the costs, expenses and liabilities which
might be incurred therein or thereby;
(e) the Pass Through Trustee shall not be liable for any action
taken or omitted by it in good faith and believed by it to be authorized or
within the discretion, rights or powers conferred upon it under the Pass
Through Trust;
(f) prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default, the Pass Through Trustee shall
not be bound to make any investigation into the facts or matters stated in
any resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, order, approval, appraisal, bond, debenture,
note, coupon, security, or other paper or document unless requested in
writing to do so by the Majority in Interest of Certificateholders;
provided that if the payment within a reasonable time to the Pass Through
Trustee of the costs, expenses or liabilities likely to be incurred by it
in the making of such investigation is, in the opinion of the Pass Through
Trustee, not reasonably assured to the Pass Through Trustee by the security
afforded to it by the terms of
41
<PAGE> 50
the Pass Through Trust, the Pass Through Trustee may require reasonable
indemnity against such expenses or liabilities as a condition to
proceeding; the reasonable expenses of every such examination shall be paid
by the Company or, if paid by the Pass Through Trustee or any predecessor
trustee, shall be repaid by the Company upon demand;
(g) the Pass Through Trustee may execute any of the trusts or
powers under the Pass Through Trust or perform any duties thereunder either
directly or by or through agents or attorneys not regularly in its employ
and the Pass Through Trustee shall not be responsible for any misconduct or
negligence on the part of any such agent or attorney appointed by it with
due care; and
(h) the Pass Through Trustee shall not be required to expend or
risk its own funds or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of its rights or
powers under the Pass Through Trust, if the Pass Through Trustee has
determined in good faith that the repayment of such funds or adequate
indemnity against such liability is not reasonably assured to it.
SECTION 8.04. Pass Through Trustee Not Responsible for Recitals.
The Pass Through Trustee assumes no responsibility for the correctness of the
recitals contained herein or in the Pass Through Certificates, except for the
execution and authentication of the Pass Through Certificates by the Pass
Through Trustee in accordance with Section 2.05 and 2.06, respectively.
SECTION 8.05. Pass Through Trustee and Agents May Hold Pass
Through Certificates; Collections. The Pass Through Trustee and any agent of
the Pass Through Trustee, in its individual or any other capacity, may become
the owner or pledgee of Pass Through Certificates with the same rights it would
have if it were not the Pass Through Trustee or such agent and, subject to the
applicable provisions of the Trust Indenture Act, may otherwise deal with the
Company, any Related Indenture Trustee or Related Owner Trustee and receive,
collect, hold and retain collections therefrom with the same rights it would
have if it were not the Pass Through Trustee or such agent.
SECTION 8.06. Moneys Held by Pass Through Trustee. Subject to
Sections 5.06 and 12.04 hereof, all moneys received by the Pass Through Trustee
shall, until used or applied as provided herein, be held in trust for the
purposes for which
42
<PAGE> 51
they were received, but need not be segregated from other funds except to the
extent required by mandatory provisions of law. Subject to Section 5.06,
neither the Pass Through Trustee nor any agent thereof shall be under any
liability for interest on any moneys received by it hereunder.
SECTION 8.07. Right of Pass Through Trustee to Rely on Officers'
Certificate. Subject to Section 8.03, whenever in the administration of the
Pass Through Trust the Pass Through Trustee shall deem it necessary or
desirable that a matter be proved or established prior to taking or suffering
or omitting any action thereunder, such matter (unless other evidence in
respect thereof is specifically prescribed herein) may, in the absence of bad
faith on the part of the Pass Through Trustee, be deemed to be conclusively
proved and established by an Officers' Certificate delivered to the Pass
Through Trustee by the Company, any Related Indenture Trustee or any Related
Owner Trustee, as the case may be, and such certificate, in the absence of bad
faith on the part of the Pass Through Trustee, shall be full warrant to the
Pass Through Trustee for any action taken, suffered or omitted by it under the
provisions of this Pass Through Agreement upon the faith thereof.
SECTION 8.08. Compensation. The Company covenants and agrees to
pay, and the Pass Through Trustee shall be entitled to receive upon
presentation of a reasonably detailed invoice, reasonable compensation and
payment or reimbursement for its reasonable advances, expenses and
disbursements (including the reasonable compensation and expenses and
disbursements of its counsel, agents and other persons not regularly in its
employ) in connection with its services rendered hereunder or in any way
relating to or arising out of the administration of the Pass Through Trust or
the Trust Property, except any such advance, expense or disbursement
attributable to the Pass Through Trustee's negligence, willful misconduct or
bad faith or incurred as a result of the breach of its representation and
covenant set forth in Section 8.02, and shall have a priority claim on the
Trust Property for the payment of such compensation, advances, expenses and
disbursements to the extent that such compensation, advances, expenses and
disbursements shall not be paid by the Company.
In addition, the Pass Through Trustee shall be entitled to
reimbursement from, and shall have a priority claim on, all property and funds
held or collected by the Pass Through Trustee in its capacity as Pass Through
Trustee for any tax incurred without negligence, bad faith or willfull
misconduct on its part, arising out of or in connection with the acceptance or
administration of the Pass Through Trust
43
<PAGE> 52
(other than any tax attributable to the Pass Through Trustee's compensation for
serving as such), including any costs and expenses incurred in contesting the
imposition of any such tax. If the Pass Through Trustee reimburses itself from
the Trust Property for any such tax it shall within 30 days mail a brief report
setting forth the circumstances thereof to all Certificateholders as their
names and addresses appear in the Register.
ARTICLE IX
INDEMNIFICATION OF
PASS THROUGH TRUSTEE BY THE COMPANY
The Company hereby agrees, whether or not any of the transactions
contemplated hereby shall be consummated, to assume liability for, and does
hereby indemnify, protect, save and keep harmless the Pass Through Trustee, in
its individual capacity, and its successors, assigns, agents and servants, with
respect to the claims of the Pass Through Trustee for payment or reimbursement
under Section 8.08 and from and against any and all liabilities, obligations,
losses, damages, penalties, taxes (excluding any taxes payable by the Pass
Through Trustee on or measured by any compensation received by the Pass Through
Trustee for its services under this Pass Through Agreement and excluding any
tax attributable to the failure of the Pass Through Trust to qualify as a
"grantor trust", or to be otherwise disregarded, for Federal, state or local
income tax purposes), claims, actions, suits, costs, expenses or disbursements
(including legal fees and expenses) of any kind and nature whatsoever which may
be imposed on, incurred by or asserted against the Pass Through Trustee in its
individual capacity (whether or not also agreed to be indemnified against by
any other Person under any other document) in any way relating to or arising
out of this Pass Through Agreement or the enforcement of any of the terms
hereof, or in any way relating to or arising out of the administration of the
Pass Through Trust or the Trust Property or the action or inaction of the Pass
Through Trustee hereunder, except only (i) in the case of negligence, willful
misconduct or bad faith of the Pass Through Trustee in the performance of its
duties hereunder, (ii) as may result from the inaccuracy of any representation
or warranty of the Pass Through Trustee herein or in any Participation
Agreement or (iii) as otherwise provided in Section 8.02 hereof. The Pass
Through Trustee in its individual capacity shall be entitled to
indemnification, from the Trust Property, for any liability, obligation, loss,
damage, penalty, claim, action,
44
<PAGE> 53
suit, cost, expense or disbursement indemnified against pursuant to this
Article IX to the extent not reimbursed by the Company or others, but without
releasing any of them from their respective agreements of reimbursement; and to
secure the same the Pass Through Trustee shall have a prior Lien on the Trust
Property. The indemnities contained in this Article IX shall survive the
termination of this Pass Through Agreement or the Pass Through Trust and the
resignation or removal of the Pass Through Trustee hereunder or thereunder.
The Pass Through Trustee, in its individual capacity, shall notify
the Company promptly of any tax for which it may seek indemnity. The Company
shall defend against the imposition of such tax and the Pass Through Trustee,
in its individual capacity shall cooperate in the defense. The Company need
not pay for any taxes paid, in settlement or otherwise, without its consent.
Notwithstanding anything else to the contrary contained in this
Pass Through Trust Agreement or any of the Transaction Documents, the Company
shall not indemnify any party for any Federal, state or local income taxes
imposed upon the Pass Through Trust by reason of the Pass Through Trust failing
to be classified as a "grantor trust", or otherwise being disregarded, for
Federal, state or local income tax purposes.
ARTICLE X
SUCCESSOR TRUSTEES
SECTION 10.01. Resignation and Removal of Pass Through Trustee;
Appointment of Successor. (a) The Pass Through Trustee may resign at any time
as trustee of the Pass Through Trust without cause by giving at least 30 days
prior written notice to the Company, the Related Indenture Trustees and the
Related Owner Trustees, such resignation to be effective upon the acceptance of
the trusteeship by a successor Pass Through Trustee. In addition, a Majority
in Interest of Certificateholders may at any time remove the Pass Through
Trustee without cause by an instrument in writing delivered to the Company, the
Related Owner Trustees, the Related Indenture Trustees and the Pass Through
Trustee, and the Pass Through Trustee shall promptly notify each
Certificateholder of such removal in writing, such removal to be effective upon
the acceptance of the trusteeship by a successor Pass Through Trustee. In the
case of the resignation or removal of the Pass Through Trustee, a Majority
45
<PAGE> 54
in Interest of Certificateholders may appoint a successor Pass Through Trustee
by an instrument signed by such Certificateholders. If a successor Pass
Through Trustee shall not have been appointed within 90 days after such notice
of resignation or removal, the Pass Through Trustee, the Company or any
Certificateholder may apply to any court of competent jurisdiction to appoint a
successor Pass Through Trustee to act until such time, if any, as a successor
shall have been appointed as provided above. The successor Pass Through
Trustee so appointed by such court shall immediately and without further act be
superseded by any successor Pass Through Trustee appointed as provided above
within one year from the date of the appointment by such court.
(b) If at any time any of the following occurs with respect to
the Pass Through Trust:
(i) the Pass Through Trustee fails to comply with the
requirements of Section 310 of the Trust Indenture Act after written
request for such compliance by any Certificateholder who has been a bona
fide Certificateholder for at least six months; or
(ii) the Pass Through Trustee ceases to be eligible in accordance
with the provisions of Section 10.02 to act as trustee for the Pass Through
Trust and fails to resign after written request for such resignation by the
Company or by any such bona fide Certificateholder; or
(iii) the Pass Through Trustee becomes incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver or liquidator of
the Pass Through Trustee or of its property shall be appointed, or any
public officer takes charge or control of the Pass Through Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation;
then the Company may remove the Pass Through Trustee and appoint a successor
trustee by written instrument, in duplicate, executed by a Responsible Officer
of the Company, one copy of which instrument shall be delivered to the Pass
Through Trustee so removed and one copy to the successor trustee, or, subject
to the provisions of Section 315(e) of the Trust Indenture Act, any
Certificateholder who has been a bona fide Certificateholder for at least six
months may, on behalf of himself or herself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Pass
Through Trustee and the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe,
remove
46
<PAGE> 55
the Pass Through Trustee and appoint a successor trustee, which removal and
appointment shall become effective upon acceptance of appointment by the
successor trustee as provided in Section 10.03. The successor Pass Through
Trustee so appointed by such court shall immediately and without further act be
superseded by any successor Pass Through Trustee appointed by the
Certificateholders as provided in subsection (a) above within one year from the
date of appointment by such court.
SECTION 10.02. Persons Eligible for Appointment as Pass Through
Trustee. The Pass Through Trust shall at all times have a Pass Through Trustee
which shall be a Person eligible to act as trustee under Section 310(a) of the
Trust Indenture Act and shall be a corporation organized and doing business
under the laws of the United States of America or of any State or the District
of Columbia having a combined capital and surplus of at least $100,000,000, or
a direct or indirect subsidiary of such a corporation, or a member of a bank
holding company group, having a combined capital and surplus of at least
$100,000,000 and such subsidiary or member itself having a capital and surplus
of at least $10,000,000, and which is authorized under such laws to exercise
corporate trust powers and is subject to supervision of examination by Federal,
State or District of Columbia authority. If such corporation publishes reports
of condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation shall be deemed
to be its combined capital and surplus as set forth in its most recent report
of condition so published. If at any time the Pass Through Trustee ceases to
be eligible in accordance with the provisions of this Section to act as trustee
for the Pass Through Trust, the Pass Through Trustee shall resign immediately
as Pass Through Trustee in the manner and with the effect specified in Section
10.01.
SECTION 10.03. Acceptance of Appointment by Successor Trustee.
Any successor trustee appointed as provided in Section 10.01 for the Pass
Through Trust shall execute and deliver to the Company and to its predecessor
trustee an instrument accepting such appointment, and thereupon the resignation
or removal of the predecessor trustee shall become effective and such successor
trustee, without any further act, deed or conveyance, shall become vested with
all rights, powers, duties and obligations of its predecessor with respect to
the Pass Through Trust, as if such successor trustee was originally named as
trustee of the Pass Through Trust. Notwithstanding the foregoing, on the
written request of the Company or the successor trustee, the trustee
47
<PAGE> 56
ceasing to act shall, upon payment of its charges then unpaid and subject to
Section 12.04, pay over to the successor trustee all moneys at the time held by
it with respect to the Pass Through Trust and shall execute and deliver an
instrument transferring to such successor trustee all such rights, powers,
duties and obligations. Upon request of any such successor trustee, the
Company shall execute any and all instruments in writing for more fully and
certainly vesting in and confirming to such successor trustee all such rights
and powers. Any trustee ceasing to act shall, nevertheless, retain a prior
claim upon all property or funds held or collected by such trustee with respect
to the Pass Through Trust to secure any amounts then due it pursuant to the
provisions of Article IX.
No successor trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 10.02 to act as trustee of the Pass
Through Trust.
Upon acceptance of appointment by a successor trustee as provided
in this Section, the successor trustee shall notify the Certificateholders of
such appointment by first-class mail at their last addresses as they shall
appear in the Register, and shall mail a copy of such notice to the Company,
the Related Indenture Trustees and the Related Owner Trustees. If the
acceptance of appointment is substantially contemporaneous with the
resignation, then the notice called for by the preceding sentence may be
combined with the notice called for by Section 10.01.
SECTION 10.04. Merger, Conversion, Consolidation or Succession to
Business of Pass Through Trustee. Any corporation into which the Pass Through
Trustee may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Pass Through Trustee is a party, or any corporation succeeding to the corporate
trust business of the Pass Through Trustee, shall be the successor to the Pass
Through Trustee hereunder, provided that, anything herein to the contrary
notwithstanding, such corporation shall be eligible under the provisions of
Section 10.02 to act as trustee hereunder, without the execution or filing of
any paper or any further act on the part of any of the parties hereto.
If, at the time of such succession to the Pass Through Trustee,
any of the Pass Through Certificates have been authenticated but not delivered,
such successor may adopt the certificate of authentication of the predecessor
Pass
48
<PAGE> 57
Through Trustee and deliver such Pass Through Certificates so authenticated;
and, if at that time any of the Pass Through Certificates have not been
authenticated, such successor may authenticate such Pass Through Certificates
either in the name of any of its predecessor or in its own name as the
successor Pass Through Trustee; and in all such cases such certificate of
authentication shall have the full force of the certificate of authentication
of the Pass Through Trustee set forth in Section 2.01; provided that the right
to adopt the certificate of authentication of any predecessor Pass Through
Trustee or to authenticate Pass Through Certificates in the name of any
predecessor Pass Through Trustee shall apply only to its successor or
successors by merger, conversion or consolidation.
SECTION 10.05. Appointment of Separate Pass Through Trustees.
(a) At any time or times, for the purpose of meeting any legal requirements of
any jurisdiction in which any part of the Trust Property may at the time be
located or in which any action of the Pass Through Trustee may be required to
be performed or taken, the Pass Through Trustee, by an instrument in writing
signed by it, may appoint one or more individuals or corporations to act as
separate trustee or separate trustees or co-trustee, acting jointly with the
Pass Through Trustee, of all or any part of the Trust Property, to the full
extent that local law makes it necessary for such separate trustee or separate
trustees or co-trustee, acting jointly with the Pass Through Trustee, to act.
(b) The Pass Through Trustee and, at the request of the Pass
Through Trustee, the Company, shall execute, acknowledge and deliver all such
instruments as may be required by the legal requirements of any jurisdiction or
by any such separate trustee or separate trustees or co-trustee for the purpose
of more fully confirming such title, rights or duties to such separate trustee
or separate trustees or co-trustee. Upon the acceptance in writing of such
appointment by any such separate trustee or separate trustees or co-trustee,
it, he, she or they shall be vested with such title to the Trust Property or
any part thereof, and with such rights, powers, duties and obligations, as
shall be specified in the instrument of appointment, and such rights, powers,
duties and obligations shall be conferred or imposed upon and exercised or
performed by the Pass Through Trustee, or the Pass Through Trustee and such
separate trustee or separate trustees or co-trustee jointly with the Pass
Through Trustee subject to all the terms of this Pass Through Agreement, except
to the extent that under any law of any jurisdiction in which any particular
act or acts are to be performed the Pass Through Trustee shall be incompetent
or unqualified to perform
49
<PAGE> 58
such act or acts, in which event such rights, powers, duties and obligations
shall be exercised and performed by such separate trustee or separate trustees
or co-trustee, as the case may be. Any separate trustee or separate trustees
or co-trustee may, at any time by an instrument in writing, constitute the Pass
Through Trustee its, her or his attorney-in-fact and agent with full power and
authority to do all acts and things and to exercise all discretion on its, her
or his behalf and in its, her or his name. In case any such separate trustee
or co-trustee shall die, become incapable of acting, resign or be removed, the
title to the Trust Property and all assets, property, rights, powers, duties
and obligations and duties of such separate trustee or co-trustee shall, so far
as permitted by law, vest in and be exercised by the Pass Through Trustee,
without the appointment of a successor to such separate trustee or co-trustee
unless and until a successor is appointed.
(c) All provisions of this Pass Through Agreement which are for
the benefit of the Pass Through Trustee (including without limitation Article
IX hereof) shall extend to and apply to each separate trustee or co-trustee
appointed pursuant to the foregoing provisions of this Section 10.06.
(d) Every additional trustee and separate trustee hereunder
shall, to the extent permitted by law, be appointed and act and the Pass
Through Trustee shall act, subject to the following provisions and conditions:
(i) all powers, duties, obligations and rights conferred upon the
Pass Through Trustee in respect of the receipt, custody, investment and
payment of moneys shall be exercised solely by the Pass Through Trustee;
(ii) all other rights, powers, duties and obligations conferred or
imposed upon the Pass Through Trustee shall be conferred or imposed and
exercised or performed by the Pass Through Trustee and such additional
trustee or trustees and separate trustee or trustees jointly except to the
extent that under any law of any jurisdiction in which any particular act
or acts are to be performed, the Pass Through Trustee shall be incompetent
or unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations (including the holding of title to the Trust
Property in any such jurisdiction) shall be exercised and performed by such
additional trustee or trustees or separate trustee or trustees;
50
<PAGE> 59
(iii) no power hereby given to, or exercisable by, any such
additional trustee or separate trustee shall be exercised hereunder by such
additional trustee or separate trustee except jointly with, or with the
consent of, the Pass Through Trustee; and
(iv) no trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder.
If at any time the Pass Through Trustee shall deem it no longer necessary or
prudent in order to conform to any such law, the Pass Through Trustee shall
execute and deliver all instruments and agreements necessary or proper to
remove any additional trustee or separate trustee.
(e) Any request, approval or consent in writing by the Pass
Through Trustee to any additional trustee or separate trustee shall be
sufficient warrant to such additional trustee or separate trustee, as the case
may be, to take such action as may be so requested, approved or consented to.
(f) Notwithstanding any other provision of this Section 10.06,
the powers of any additional trustee or separate trustee shall not exceed those
of the Pass Through Trustee hereunder.
ARTICLE XI
SUPPLEMENTS AND AMENDMENTS TO THIS
PASS THROUGH AGREEMENT AND OTHER DOCUMENTS
SECTION 11.01. Supplemental Agreements Without Consent of
Certificateholders. The Company and the Pass Through Trustee may enter into an
agreement or agreements supplemental hereto for one or more of the following
purposes:
(a) to evidence the succession of another corporation to the
Company, or successive successions, and the assumption by the successor
corporation of the covenants, agreements and obligations of the Company
herein;
(b) to add to the covenants of the Company such further
covenants, restrictions, conditions or provisions as the Pass Through
Trustee shall consider to be for the protection of the Certificateholders;
51
<PAGE> 60
(c) to surrender any right or power conferred upon the Company
herein;
(d) to cure any ambiguity or to correct or supplement any
provision contained herein that may be defective or inconsistent with any
other provision contained herein; or to make such other provisions in
regard to matters or questions arising under this Pass Through Agreement as
the Company may deem necessary or desirable and that will not adversely
affect the interests of the Certificateholders;
(e) to correct or amplify the description of any property at any
time that constitutes Trust Property or better to assure, convey and
confirm unto the Pass Through Trustee any such property to be included in
the Trust Property;
(f) to evidence and provide for the acceptance and appointment
hereunder or under the Pass Through Trust of a successor trustee and to add
to or change any of the provisions hereof as may be necessary to provide
for or facilitate the administration of the Pass Through Trust by more than
one trustee, pursuant to the requirements of Section 10.03;
(g) to modify, eliminate or add to the provisions of this Pass
Through Agreement to the extent necessary to continue the qualification of
this Pass Through Agreement (including any supplemental agreement) under
the Trust Indenture Act, or under any similar Federal statute enacted after
the date hereof, and to add to this Pass Through Agreement such other
provisions as may be expressly permitted by the Trust Indenture Act,
excluding, however, the provisions referred to in Section 316(a)(2) of the
Trust Indenture Act as in effect on the date hereof or any corresponding
provision in any similar Federal statute enacted after the date hereof;
(h) to add, eliminate or change any provision hereunder so long
as such action shall not adversely affect the interests of the
Certificateholders;
provided that no such supplemental agreement shall cause any Pass Through Trust
to become taxable as an association within the meaning of Treasury Regulation
Section 301.7701-4.
The Pass Through Trustee is hereby authorized to join in the
execution of any such supplemental agreement, to make any further appropriate
agreements and stipulations that
52
<PAGE> 61
may be contained therein and to accept the conveyance, transfer, assignment,
mortgage or pledge of any property thereunder, but the Pass Through Trustee
shall not be obligated to enter into any such supplemental agreement that
adversely affects the Pass Through Trustee's own rights, duties or immunities
under this Pass Through Agreement or otherwise, whether in its official or
individual capacity.
Any supplemental agreement contemplated by this Section may be
executed without the consent of the Certificateholders of the Outstanding Pass
Through Certificates, notwithstanding any of the provisions of Section 11.02.
SECTION 11.02. Supplemental Agreements With Consent of
Certificateholders. With the consent (evidenced as provided in Article VI) of
the Majority in Interest of Certificateholders, the Company and the Pass
Through Trustee may, from time to time and at any time, enter into an agreement
or agreements supplemental hereto for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this Pass
Through Agreement or of modifying in any manner the rights of the related
Certificateholders; provided, that no such supplemental agreement shall cause
any Pass Through Trust to become taxable as an association within the meaning
of Treasury Regulation Section 301.7701-4; and provided further that, without
the consent of each Certificateholder (or the proxy therefor), no such
amendment of or supplement to this Pass Through Agreement, or modification of
the terms of, or consent under, any thereof, shall (aa) modify any of the
provisions of Section 7.10 or this Section 11.02, (bb) reduce the amount or
extend the time of payment of any amount owing or payable on the Equipment
Notes or distributions to be made on any Pass Through Certificate pursuant to
Article V, or alter the currency in which any amount payable under any such
Pass Through Certificate is to be paid, or impair the right of any Pass Through
Certificateholder to commence legal proceedings to enforce a right to receive
payment hereunder, (cc) reduce, modify or amend any indemnities in favor of any
Certificateholder (except as consented to by each such Certificateholder
adversely affected thereby (or the proxy therefor)), or (dd) create or permit
the creation of any Lien on the Trust Property or any part thereof, or deprive
any Certificateholder of the benefit of the Pass Through Trust with respect to
the Trust Property, whether by disposition of the Trust Property or otherwise,
except as provided in Section 7.02 or in connection with the exercise of
remedies under Article VII.
53
<PAGE> 62
Upon the request of the Company and upon the filing with the Pass
Through Trustee of evidence of the consent of the applicable Certificateholders
required under this Section and other documents, if any, required by Section
6.01, the Pass Through Trustee shall join with the Company in the execution of
such supplemental agreement unless such supplemental agreement affects the Pass
Through Trustee's own rights, duties or immunities under this Pass Through
Agreement or otherwise, in which case the Pass Through Trustee may in its
discretion, but shall not be obligated to, enter into such supplemental
agreement.
It shall not be necessary for the consent of the
Certificateholders under this Section to approve the particular form of any
proposed supplemental agreement, but it shall be sufficient if such consent
shall approve the substance thereof.
Promptly after the execution by the Company and the Pass Through
Trustee of any supplemental agreement relating to any Pass Through Trust
pursuant to the provisions of this Section, the Pass Through Trustee shall mail
a notice thereof by first-class mail to the Certificateholders at their
addresses as they shall appear on the Register, setting forth in general terms
the substance of such supplemental agreement. Any failure of the Pass Through
Trustee to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental agreement.
SECTION 11.03. Effect of Supplemental Agreements. Upon the
execution of any supplemental agreement pursuant to the provisions hereof, this
Pass Through Agreement shall be and be deemed to be modified and amended in
accordance therewith and the respective rights, limitations of rights,
obligations, duties and immunities hereunder and under the Pass Through Trust
of the Pass Through Trustee, the Company and the Certificateholders shall
thereafter be determined, exercised and enforced hereunder and thereunder
subject in all respects to such modifications and amendments, and all the terms
and conditions of any such supplemental agreement shall be and be deemed to be
part of the terms and conditions of this Pass Through Agreement and the Pass
Through Trust for any and all purposes.
SECTION 11.04. Documents to Be Given to Trustee. The Pass
Through Trustee, subject to the provisions of Sections 8.02 and 8.03, may
receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such supplemental agreement complies with the applicable
provisions of this Pass Through Agreement.
54
<PAGE> 63
SECTION 11.05. Notation on Pass Through Certificates in Respect
of Supplemental Agreements. Pass Through Certificates authenticated and
delivered after the execution of any supplemental agreement pursuant to the
provisions of this Article may bear a notation in form approved by the Pass
Through Trustee as to any matter provided for by such supplemental agreement.
If the Company or the Pass Through Trustee shall so determine, new Pass Through
Certificates so modified as to conform, in the opinion of the Company and the
Pass Through Trustee, to any modification of this Pass Through Agreement
contained in any such supplemental agreement may be provided by the Company,
executed and authenticated by the Pass Through Trustee and delivered in
exchange for the Outstanding Pass Through Certificates.
SECTION 11.06. Trust Indenture Act. Any supplemental agreement
executed pursuant to the terms of this Article shall on the date of the
execution thereof conform to the provisions of the Trust Indenture Act as in
force on such date.
SECTION 11.07. Revocation and Effect of Consents. Until an
amendment or waiver becomes effective, a consent to it by a Certificateholder
is a continuing consent by such Certificateholder and every subsequent
Certificateholder of the related Pass Through Certificate, even if notation of
the consent is not made on such Pass Through Certificate. However, any such
Certificateholder or subsequent Certificateholder may revoke the consent as to
his or her Pass Through Certificate if the Pass Through Trustee receives the
notice of revocation before the date the amendment or waiver becomes effective.
After an amendment or waiver becomes effective, it shall bind every
Certificateholder affected by such amendment or waiver.
SECTION 11.08. Amendments, Waivers, etc., of Related Indenture
Documents. If the Pass Through Trustee, as holder of any Equipment Note in
trust for the benefit of the Certificateholders, receives a request for a
consent to any modification, amendment or supplement to any related Indenture
or other related Indenture Document or to give any consent, waiver,
authorization or approval under such related Indenture or such other related
Indenture Documents, the Pass Through Trustee shall forthwith notify each
Certificateholder, as shown on the Register as of such date, of such request.
Such notice shall request instructions from such Certificateholders with
respect to such request. Subject to Section 7.10, the Pass Through Trustee
shall, as the holder of such Equipment Note, consent or vote with respect
thereto in the same
55
<PAGE> 64
proportion as so instructed by the respective Certificateholders.
Notwithstanding the foregoing, but subject to Section 7.09, if an Event of
Default shall have occurred and be continuing, the Pass Through Trustee may, in
its own discretion and at its own direction, consent and notify the Related
Indenture Trustee of such consent to any modification, amendment, supplement or
waiver under any related Indenture Document.
ARTICLE XII
TERMINATION OF PASS THROUGH TRUSTS;
UNCLAIMED MONEYS
SECTION 12.01. Termination of Pass Through Trusts. The Pass
Through Trust and the obligations and responsibilities of the Company and the
Pass Through Trustee thereunder shall terminate upon the distribution to all
Certificateholders and the Pass Through Trustee of all amounts required to be
distributed to them pursuant to this Pass Through Agreement and the disposition
of all property held as part of the Trust Property; provided that in no event
shall the Pass Through Trust continue beyond the expiration of 21 years after
the death of the last survivor of Mario Cuomo, Governor of New York State,
living on the date of this Pass Through Agreement.
Notice of termination of the Pass Through Trust, specifying the
applicable Distribution Date upon which the Certificateholders may surrender
their Pass Through Certificates to the Pass Through Trustee for payment of the
final distribution and cancellation thereof, shall be mailed promptly by the
Pass Through Trustee to the Certificateholders not earlier than the 60th day
and not later than the 20th day next preceding such final distribution
specifying (i) the Distribution Date upon which such final distribution will be
made and that such distribution will be made only upon presentation and
surrender of the Pass Through Certificates at the office or agency of the Pass
Through Trustee specified therein, (ii) the amount of any such final
distribution, and (iii) that the Record Date otherwise applicable to such
Distribution Date is not applicable. The Pass Through Trustee shall notify the
Registrar at the time the Certificateholders are notified of such final
distribution. Upon presentation and surrender of the Pass Through
Certificates, the Pass Through Trustee shall distribute all amounts
distributable on the Pass Through Certificates on such Distribution Date
pursuant to Section 5.04.
56
<PAGE> 65
SECTION 12.02. Application by Pass Through Trustee of Funds
Deposited for Payment of Pass Through Certificates. Subject to Section 12.04,
all moneys deposited with the Pass Through Trustee for payment pursuant to
Section 12.01 shall be held in trust and applied by it to the prompt payment,
either directly or through any Paying Agent, to the Certificateholders of the
Pass Through Certificates, of all sums due and to become due thereon; but such
money need not be segregated from other funds except to the extent required by
law.
In the event that all of the Certificateholders shall not
surrender their Certificates for cancellation within six months after the date
specified in the above-mentioned written notice, the Pass Through Trustee shall
give a second written notice to the remaining Certificateholders to surrender
their Certificates for cancellation and to receive the final distribution with
respect thereto.
SECTION 12.03. Repayment of Moneys Held by Paying Agent. In
connection with the satisfaction and discharge of the Pass Through Trust, all
moneys then held by any Paying Agent for the Pass Through Trust shall, upon
demand of the Pass Through Trustee, be repaid to it and thereupon such Paying
Agent shall be released from all further liability with respect to such moneys.
SECTION 12.04. Transfer of Moneys Held by Pass Through Trustee
and Paying Agent Unclaimed for Two Years and Eleven Months. Any moneys
deposited with or paid to the Pass Through Trustee or any Paying Agent to be
distributed on any Pass Through Certificate and not applied but remaining
unclaimed for two years and eleven months after the date upon which such amount
has become due and payable, shall, unless otherwise required by mandatory
provisions of applicable escheat or abandoned or unclaimed property law, be
paid to the Related Indenture Trustees by the Pass Through Trustee or such
Paying Agent and the applicable Certificateholder shall, unless otherwise
required by mandatory provisions of applicable escheat or abandoned or
unclaimed property laws, thereafter look only to such Related Indenture
Trustees for any payment which such Certificateholder may be entitled to
collect, and all liability of the Pass Through Trustee, or any Paying Agent
with respect to such moneys shall thereupon cease.
57
<PAGE> 66
ARTICLE XIII
MISCELLANEOUS
SECTION 13.01. Capacity in Which Acting. The Pass Through
Trustee acts hereunder and under the Pass Through Trust not in its individual
capacity but solely as trustee except as expressly provided herein.
SECTION 13.02. No Legal Title to Trust Property in
Certificateholders. No Certificateholder shall have legal title to any part of
the Trust Property. No transfer, by operation of law or otherwise, of any Pass
Through Certificate or other right, title and interest of any Certificateholder
in and to the Trust Property or under the Pass Through Trust shall operate to
terminate the Pass Through Trust or entitle such Certificateholder or any
successor or transferee of such Certificateholder to an accounting or to the
transfer to it of legal title to any part of the Trust Property.
SECTION 13.03. Certificates Nonassessable and Fully Paid. No
Certificateholder shall be personally liable for obligations of the Pass
Through Trust, and the Fractional Undivided Interests shall be nonassessable
for any losses or expenses of the Pass Through Trust or for any reason
whatsoever, and upon authentication of the Pass Through Certificates by the
Pass Through Trustee pursuant to Section 3.02, such Pass Through Certificates
will be and shall be deemed fully paid. No Certificateholder shall have any
right (except as expressly provided herein) to vote or in any manner otherwise
control the operation and management of the Trust Property, the Pass Through
Trust, or the obligations of the parties hereto, nor shall anything set forth
herein or in the Pass Through Certificates be construed so as to constitute the
Certificateholders from time to time as partners or members of an association.
SECTION 13.04. Pass Through Agreement for the Benefit of the
Company, the Pass Through Trustee and the Certificateholders. Nothing in this
Pass Through Agreement or in any Pass Through Certificate, whether express or
implied, shall be construed to give to any person other than the Company, the
Pass Through Trustee, as trustee and in its individual capacity, and the
Certificateholders any legal or equitable right, remedy or claim under or in
respect of this Pass Through Agreement, the Pass Through Trust or any Pass
Through Certificate.
58
<PAGE> 67
SECTION 13.05. Limitation on Rights of Certificateholders. The
death or incapacity of any Certificateholder shall not operate to terminate the
Pass Through Trust, nor entitle such Certificateholder's legal representatives
or heirs to claim an accounting or to take any action or commence any
proceeding in any court for a partition or winding up of the Pass Through
Trust, nor otherwise affect the rights, obligations, and liabilities of the
parties hereto or any of them. No Certificateholder shall be entitled to
revoke the Pass Through Trust.
SECTION 13.06. Notices. Unless otherwise expressly specified or
permitted by the terms hereof, all notices, requests, demands, authorizations,
directions, consents, waivers or documents provided or permitted by this Pass
Through Agreement to be made, given, furnished or filed shall be in writing,
mailed by certified mail, postage prepaid, or by confirmed telex or telecopy,
and (i) if to the Pass Through Trustee, at its office at One First National
Plaza, Suite 0126, Chicago, Illinois 60670-0126 (telecopier: (312) 407-1708),
Attention: Corporate Trust Services Division; or (ii) if to the Company,
addressed to it at its offices at One United Bank Center, 1700 Lincoln Street,
Denver, Colorado 80203 (telecopier: (303) 837-6007), Attention: Treasurer.
Any party hereto may change the address to which notices to such party will be
sent by giving notice of such change to the other party to this Pass Through
Agreement.
Where this Pass Through Agreement provides for notice to
Certificateholders, such notice shall be sufficiently given (unless otherwise
expressly provided herein) if in writing and mailed, first-class postage
prepaid, to each Certificateholder entitled thereto, at his or her last address
as it appears in the Register. In any case where notice to Certificateholders
is given by mail, neither the failure to mail such notice, nor any defect in
any notice so mailed, to any particular Certificateholder shall affect the
sufficiency of such notice with respect to other Certificateholders. Where
this Pass Through Agreement provides for notice in any manner, such notice may
be waived in writing by the person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Certificateholders shall be filed with the Pass
Through Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
In case, by reason of the suspension of or irregularities in
regular mail service, it shall be impracticable to mail notice to any
Certificateholders when
59
<PAGE> 68
such notice is required to be given pursuant to any provision of this Pass
Through Agreement, then any manner of giving such notice as shall be
satisfactory to the Pass Through Trustee shall be deemed to be a sufficient
giving of such notice.
SECTION 13.07. Officers' Certificates and Opinions of Counsel;
Statements to Be Contained Therein. Upon any application or demand by the
Company to the Pass Through Trustee to take any action, the Company shall
furnish to the Pass Through Trustee (i) an Officers' Certificate stating that
all conditions precedent, if any, provided for in this Pass Through Agreement
relating to the proposed action have been complied with and that the proposed
action is in conformity with the requirements of this Pass Through Agreement,
and (ii) an Opinion of Counsel stating that in the opinion of such counsel all
such conditions precedent, if any, have been complied with, except that in the
case of any such application or demand as to which the furnishing of such
documents is specifically required by any provision of this Pass Through
Agreement relating to such particular application or demand, no additional
certificate or opinion need be furnished.
Each certificate or opinion required by this Pass Through
Agreement and delivered to the Pass Through Trustee with respect to compliance
with a condition or covenant provided for in this Pass Through Agreement,
except for the certificate required by Section 4.03(d) shall include (a) a
statement that the person making such certificate or opinion has read such
covenant or condition, (b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based, (c) a statement that, in the opinion of
such person, he has made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or not such covenant or
condition has been complied with and (d) a statement as to whether or not, in
the opinion of such person, such condition or covenant has been complied with.
Any certificate, statement or opinion of counsel may be based,
insofar as it relates to factual matters information with respect to which is
in the possession of the Company, upon the certificate, statement or opinion of
or representations by an officer or officers of the Company unless such counsel
knows that the certificate, statement or opinion or representations with
respect to the matters upon which his certificate, statement or opinion may be
based as aforesaid are erroneous, or in the exercise of reasonable care should
know that the same are erroneous.
60
<PAGE> 69
Any certificate, statement or opinion of an officer of the Company
or of counsel thereto may be based, insofar as it relates to accounting
matters, upon a certificate or opinion of or representations by an accountant
or firm of accountants employed by the Company unless such officer or counsel,
as the case may be, knows that the certificate or opinion or representations
with respect to the accounting matters upon which his certificate, statement or
opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.
Any certificate or opinion of any independent firm of public
accountants filed with the Pass Through Trustee shall contain a statement that
such firm is independent.
SECTION 13.08. Conflict of Any Provision of Pass Through
Agreement with the Trust Indenture Act. If and to the extent that any
provision of this Pass Through Agreement limits, qualifies or conflicts with
another provision included in this Pass Through Agreement by operation of
Sections 310 to 317, inclusive, of the Trust Indenture Act (an "incorporated
provision"), such incorporated provision shall control.
SECTION 13.09. Severability. Any provision of this Pass Through
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
SECTION 13.10. No Oral Modifications or Continuing Waivers. No
terms or provisions of this Pass Through Agreement or any Pass Through
Certificates may be changed, waived, discharged or terminated orally, but only
by an instrument in writing signed by the party or other person against whom
enforcement of the change, waiver, discharge or termination is sought; and any
waiver of the terms hereof or thereof shall be effective only in the specific
instance and for the specific purpose given.
SECTION 13.11. Successors and Assigns. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
each of the parties hereto and the successors and permitted assigns of each,
all as herein provided. Any request, notice, direction, consent, waiver or
other instrument or action by any Certificateholder shall bind the successors
and assigns of such Certificateholder.
61
<PAGE> 70
SECTION 13.12. Headings. The headings of the various Articles
and Sections herein and in the table of contents hereto are for the convenience
of reference only and shall not define or limit any of the terms or provisions
hereof.
SECTION 13.13. Normal Commercial Relations. Anything contained
in this Pass Through Agreement to the contrary notwithstanding, the Pass
Through Trustee and any Certificateholder, or any bank or other affiliate of
any such party, may conduct any banking or other financial transactions, and
have banking or other commercial relationships, with the Company fully to the
same extent as if this Pass Through Agreement were not in effect, including
without limitation the making of loans or other extensions of credit to the
Company for any purpose whatsoever, whether related to any of the transactions
contemplated hereby or otherwise.
SECTION 13.14. Governing Law; Counterpart Form. THIS PASS
THROUGH AGREEMENT AND EACH PASS THROUGH CERTIFICATE SHALL IN ALL RESPECTS BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW
YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. This
Pass Through Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.
SECTION 13.15. Distributions Due on Days Other than Business
Days. If any Distribution Date is not a Business Day, then such distribution
need not be made on such date, but may be made on the next succeeding Business
Day with the same force and effect as if made on the applicable Distribution
Date, and no interest shall accrue for the intervening period.
62
<PAGE> 71
IN WITNESS WHEREOF, the parties hereto have caused this Pass Through
Agreement to be duly executed this ____ day of ________, 1994 by their
respective officers thereunto duly authorized, and acknowledge that this Pass
Through Agreement has been made and delivered in the City of New York, and this
Pass Through Agreement shall be effective only upon such execution and
delivery.
THE FIRST NATIONAL BANK OF CHICAGO
not in its individual capacity,
except as otherwise expressly
provided herein, but solely
as Pass Through Trustee
By: _______________________________
Title:
NEWMONT GOLD COMPANY
By: ______________________________
Title:
63
<PAGE> 72
Exhibit A to
Pass Through
Agreement
FORM OF PASS THROUGH CERTIFICATE
Unless this pass through certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC")
to the Company or its agent for registration or transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE THEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.(1)
NEWMONT GOLD COMPANY
PASS THROUGH TRUST, [1994-A1][1994-A2]
1994 Pass Through Certificate, Series [A1][A2]
Final Scheduled Regular Distribution Date: _______
evidencing a fractional undivided interest in a pass through trust, the
property of which includes certain Equipment Notes, each secured by a
percentage of an undivided interest in a refractory gold ore treatment
facility leased to Newmont Gold Company
Certificate No. _______
Applicable interest rate on Equipment Notes held in Pass Through Trust,
1994-[A1][A2]: ___%
$___________ Fractional Undivided Interest representing _______ of the Pass
Through Trust per $1,000 face amount.
____________________
(1) This paragraph is required only if the Pass Through Certificates are
to be represented by the Registered Global Certificate.
<PAGE> 73
THIS CERTIFIES THAT ______________, for value received, is the
registered owner of a $_________ (_____________ dollars) Fractional Undivided
Interest in the Newmont Gold Company Pass Through Trust, 1994-[A1][A2] (the
"Pass Through Trust") created and declared by The First National Bank of
Chicago, as pass through trustee (the "Pass Through Trustee"), pursuant to the
Pass Through Trust Agreement dated as of July 15, 1994 (the "Pass Through
Agreement") between the Pass Through Trustee and Newmont Gold Company, a
corporation incorporated under Delaware law (the "Company"), a summary of
certain of the pertinent provisions of which is set forth below. To the extent
not otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in the Pass Through Agreement. This Pass Through
Certificate is one of the duly authorized Pass Through Certificates designated
as "Newmont Gold Company 1994 Pass Through Certificates, Series [A1][A2]."
This Pass Through Certificate is issued under and is subject to the terms,
provisions, and conditions of the Pass Through Agreement, to which the
Certificateholder of this Pass Through Certificate by virtue of the acceptance
hereof assents and by which such Certificateholder is bound. The property of
the Pass Through Trust (the "Trust Property") includes certain Equipment Notes
(the "Equipment Notes"). The Equipment Notes are secured by a percentage of an
undivided interest in a refractory gold ore treatment facility leased to the
Company.
Subject to and in accordance with the terms of the Pass Through
Agreement, from funds then available to the Pass Through Trustee, there will be
distributed on each ______ and _____ (a "Regular Distribution Date"),
commencing on _______, __, to the Person in whose name this Pass Through
Certificate is registered at the close of business on the 15th day preceding
the applicable Regular Distribution Date, an amount in respect of the Scheduled
Payments on the Equipment Notes due on such Regular Distribution Date, the
receipt of which has been confirmed by the Pass Through Trustee, equal to the
product of the percentage interest in the Pass Through Trust evidenced by this
Pass Through Certificate and an amount equal to the sum of such Scheduled
Payments. Subject to and in accordance with the terms of the Pass Through
Agreement, if Special Payments on the Equipment Notes are received by the Pass
Through Trustee, from funds then available to the Pass Through Trustee, there
shall be distributed on the applicable Special Distribution Date, to the Person
in whose name this Pass Through Certificate is registered at the close of
business on the 15th day preceding such Special Distribution Date, an amount in
respect of such Special Payments on the Equipment Notes, the receipt of which
has been confirmed by the Pass Through Trustee, equal to the product of the
percentage interest in the Pass Through Trust evidenced by this Pass Through
Certificate and an amount equal to the sum
A-2
<PAGE> 74
of such Special Payments so received. If a Distribution Date is not a Business
Day, distribution shall be made on the immediately following Business Day with
the same force and effect as if made on such Distribution Date and no interest
shall accrue during the intervening period. The Special Distribution Date
shall be the ______ day of the month determined as provided in the Pass Through
Agreement. The Pass Through Trustee shall mail notice of each Special Payment
and the Special Distribution Date therefor to the Certificateholder of this
Pass Through Certificate.
Distributions on this Pass Through Certificate will be made by the
Pass Through Trustee to the Person entitled thereto, without the presentation
or surrender of this Pass Through Certificate or the making of any notation
hereon. Except as otherwise provided in the Pass Through Agreement and
notwithstanding the above, the final distribution on this Pass Through
Certificate will be made after notice is mailed by the Pass Through Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Pass Through Certificate at the office or agency of the Pass Through
Trustee specified in such notice.
NO EMPLOYEE BENEFIT PLAN SUBJECT TO PART 4 OF SUBTITLE B OF TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR PLAN
SUBJECT TO SECTION 4975 OF THE CODE OR ANY TRUST CREATED UNDER ANY SUCH
EMPLOYEE BENEFIT PLAN OR PLAN, NOR ANY GOVERNMENTAL PLAN (AS DEFINED IN SECTION
3(32) OR ERISA OR SECTION 414(d) OF THE CODE) ORGANIZED IN A JURISDICTION
HAVING PROHIBITIONS ON TRANSACTIONS WITH SUCH GOVERNMENTAL LAWS SIMILAR TO
THOSE CONTAINED IN SECTION 406 OF ERISA OR SECTION 414(d) OF THE CODE (SUCH
EMPLOYEE BENEFIT PLAN, PLAN AND GOVERNMENTAL PLAN ARE HEREINAFTER COLLECTIVELY
REFERRED TO AS AN "ERISA PLAN"), OR ANY OTHER PERSON TREATED AS HOLDING ASSETS
OF AN ERISA PLAN MAY ACQUIRE OR HOLD THE PASS THROUGH CERTIFICATES. THE
PURCHASE BY ANY PERSON OF ANY PASS THROUGH CERTIFICATE CONSTITUTES A
REPRESENTATION BY SUCH PERSON TO THE COMPANY, THE RELATED OWNER PARTICIPANTS,
THE RELATED OWNER TRUSTEES, THE RELATED INDENTURE TRUSTEES AND THE PASS THROUGH
TRUSTEE THAT SUCH PERSON IS NOT AN ERISA PLAN AND THAT SUCH PERSON IS NOT
ACQUIRING, AND HAS NOT ACQUIRED, SUCH PASS THROUGH CERTIFICATE WITH ASSETS OF
AN ERISA PLAN.
This Pass Through Certificate shall be governed by and construed
in accordance with the laws of the State of New York.
Reference is hereby made to the further provisions of this Pass
Through Certificate set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place.
A-3
<PAGE> 75
Unless the certificate of authentication hereon has been executed
by the Pass Through Trustee, by manual signature, this Pass Through Certificate
shall not be entitled to any benefit under the Pass Through Trust or be valid
for any purpose.
IN WITNESS WHEREOF, the Pass Through Trustee has caused this Pass
Through Certificate to be duly executed.
NEWMONT GOLD COMPANY
PASS THROUGH TRUST, SERIES 1994-[A1][A2]
By: THE FIRST NATIONAL BANK OF
CHICAGO,
as Pass Through Trustee
By: ____________________
Authorized Signatory
A-4
<PAGE> 76
(FORM OF THE PASS THROUGH TRUSTEE'S CERTIFICATE OF AUTHENTICATION)
Dated:
This is one of the Pass Through Certificates referred to in the
within-mentioned Pass Through Agreement.
THE FIRST NATIONAL BANK OF
CHICAGO,
as Pass Through Trustee
By: _______________________
Authorized Signatory
A-5
<PAGE> 77
[Reverse of Pass Through Certificate]
The Pass Through Certificates do not represent a direct obligation
of, or an obligation guaranteed by, or an interest in, the Company or the Pass
Through Trustee or any affiliate thereof. The Pass Through Certificates are
limited in right of payment, all as more specifically set forth on the face
hereof and in the Pass Through Agreement. All payments or distributions made
to Certificateholders under the Pass Through Agreement shall be made only from
the Trust Property and only to the extent that the Pass Through Trustee shall
have sufficient income or proceeds from the Trust Property to make such
payments in accordance with the terms of the Pass Through Agreement. Each
Certificateholder of this Pass Through Certificate, by its acceptance hereof,
agrees that it will look solely to the income and proceeds from the Trust
Property to the extent available for distribution to such Certificateholder as
provided in the Pass Through Agreement. In connection with withholding taxes,
under certain circumstances the Pass Through Trustee may retain certain amounts
otherwise distributable to a Certificateholder. The purchase by any
Certificateholder of any Pass Through Certificate constitutes the consent of
such Certificateholder to such retention in accordance with the terms of the
Pass Through Agreement. This Pass Through Certificate does not purport to
summarize the Pass Through Agreement and reference is made to the Pass Through
Agreement for information with respect to the interests, rights, benefits,
obligations, proceeds, and duties evidenced hereby. A copy of the Pass Through
Agreement may be examined during normal business hours at the principal office
of the Pass Through Trustee, and at such other places, if any, designated by
the Pass Through Trustee, by any Certificateholder upon request.
As of the date of issuance of this Pass Through Certificate, and
assuming that no early redemption, purchase or default in respect of the
Equipment Notes shall occur, the aggregate scheduled repayments of principal on
the Equipment Notes for the Pass Through Trust and the resulting Pool Factors
for the Pass Through Trust after taking into account each such repayment are
set forth below:
A-6
<PAGE> 78
Pass Through Trust, 1994-[A1][A2]
<TABLE>
<CAPTION>
Regular Scheduled Principal
Distribution Payments on
Date Equipment Notes Pool Factor
- ------------ ------------------- -----------
<S> <C> <C>
$ 0.0000000
</TABLE>
The Pass Through Agreement permits, with certain exceptions
provided therein, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Certificateholders under the
Pass Through Trust at any time by the Company and the Pass Through Trustee with
the consent of the Majority In Interest of Certificateholders in the Pass
Through Trust. Any such consent by the Certificateholder of this Pass Through
Certificate shall be conclusive and binding on such Certificateholder and upon
all future Certificateholders of this Pass Through Certificate and of any Pass
Through Certificate issued upon the transfer hereof or in exchange hereof or in
lieu hereof whether or not notation of such consent is made upon this Pass
Through Certificate. The Pass Through Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the
Certificateholders of any of the Pass Through Certificates.
As provided in the Pass Through Agreement and subject to certain
limitations set forth therein, the transfer of this Pass Through Certificate is
registrable in the Register upon surrender of this Pass Through Certificate for
registration of transfer to the Pass Through Trustee in its capacity as
Registrar, or by any successor Registrar, duly endorsed or accompanied by a
written instrument of transfer in form satisfactory to the Pass Through Trustee
and the Registrar duly executed by the Certificateholder hereof or such
Certificateholder's attorney duly authorized in writing, and thereupon one or
more new Pass Through Certificates of authorized denominations evidencing the
same aggregate Fractional Undivided Interest in the Pass Through Trust will be
issued to the designated transferee or transferees.
The Pass Through Certificates are issuable only as registered Pass
Through Certificates without coupons in minimum denominations of $1,000
Fractional Undivided Interest and integral multiples thereof. As provided in
the Pass Through Agreement and subject to certain limitations set forth
therein, the Pass Through Certificates are exchangeable for new Pass Through
Certificates of authorized denominations evidencing the same aggregate
Fractional Undivided Interest in the Pass Through Trust, as requested by the
Certificateholder surrendering the same.
A-7
<PAGE> 79
No service charge will be made for any such registration of
transfer or exchange, but the Pass Through Trustee shall require payment of a
sum sufficient to cover any tax or governmental charge payable in connection
therewith.
The Pass Through Trustee, the Registrar, and any agent of the Pass
Through Trustee or the Registrar may treat the person in whose name this Pass
Through Certificate is registered as the owner hereof for all purposes, and
neither the Pass Through Trustee, the Registrar, nor any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Pass Through
Agreement and the Pass Through Trust created thereby shall terminate upon the
distribution to Certificateholders of all amounts required to be distributed to
them pursuant to the Pass Through Agreement and the disposition of all property
held as part of the Trust Property.
A-8
<PAGE> 80
Schedule I to
Pass Through Agreement
Newmont Gold Company
Pass Through Trust, [1994-A1][1994-A2]
Equipment Notes;
Related Indenture Documents
1. Equipment Notes (Newmont Gold Company Trust No. 1)
Interest Rate: ____%
Maturity: ____________
Principal Amount: $___________
Related Indenture Documents:
Trust Indenture and Security Agreement (Newmont Gold Company Trust
No. 1) dated as of July 15, 1994, between Shawmut Bank
Connecticut, National Association, as Owner Trustee, and The First
National Bank of Chicago, as Indenture Trustee;
Participation Agreement (Newmont Gold Company Trust No. 1) dated
as of July 15, 1994, among Newmont Gold Company, as Lessee, Philip
Morris Capital Corporation, as Owner Participant, Shawmut Bank
Connecticut, National Association, as Owner Trustee, The First
National Bank of Chicago, as Indenture Trustee, and The First
National Bank of Chicago, as Pass Through Trustee;
Trust Agreement (Newmont Gold Company Trust No. 1) dated as of
July 15, 1994, between Philip Morris Capital Corporation, as Owner
Participant and Shawmut Bank Connecticut, National Association, as
Owner Trustee; and
Lease Agreement (Newmont Gold Company Trust No. 1) dated as of
July 15, 1994, between Shawmut Bank Connecticut, National
Association, as Owner Trustee and Lessor, and Newmont Gold
Company, as Lessee.
I-1
<PAGE> 81
2. Equipment Notes (Newmont Gold Company Trust No. 2)
Interest Rate: ____%
Maturity: _____________
Principal Amount: $____________
Related Indenture Documents:
Trust Indenture and Security Agreement (Newmont Gold Company Trust
No. 2) dated as of July 15, 1994, between Shawmut Bank
Connecticut, National Association, as Owner Trustee, and The First
National Bank of Chicago, as Indenture Trustee;
Participation Agreement (Newmont Gold Company Trust No. 2) dated
as of July 15, 1994, among Newmont Gold Company, as Lessee, Philip
Morris Capital Corporation, as Owner Participant, Shawmut Bank
Connecticut, National Association, as Owner Trustee, The First
National Bank of Chicago, as Indenture Trustee, and The First
National Bank of Chicago, as Pass Through Trustee;
Trust Agreement (Newmont Gold Company Trust No. 2) dated as of
July 15, 1994, between Philip Morris Capital Corporation, as Owner
Participant and Shawmut Bank Connecticut, National Association, as
Owner Trustee; and
Lease Agreement (Newmont Gold Company Trust No. 2) dated as of
July 15, 1994, between Shawmut Bank Connecticut, National
Association, as Owner Trustee and Lessor, and Newmont Gold
Company, as Lessee.
I-2
<PAGE> 1
EXHIBIT 4.3
================================================================================
PARTICIPATION AGREEMENT
DATED AS OF JULY 15, 1994
AMONG
PHILIP MORRIS CAPITAL CORPORATION,
AS OWNER PARTICIPANT
SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION,
NOT IN ITS INDIVIDUAL CAPACITY
EXCEPT AS EXPRESSLY SET FORTH HEREIN,
AND OTHERWISE SOLELY AS OWNER TRUSTEE UNDER
TRUST AGREEMENT [NO. 1][No. 2], DATED AS OF JULY 15, 1994, WITH
PHILIP MORRIS CAPITAL CORPORATION
THE FIRST NATIONAL BANK OF CHICAGO,
NOT IN ITS INDIVIDUAL CAPACITY
EXCEPT AS EXPRESSLY SET FORTH HEREIN,
AND OTHERWISE SOLELY AS INDENTURE TRUSTEE
UNDER AN INDENTURE, DATED AS OF JULY 15, 1994, WITH THE OWNER TRUSTEE,
THE FIRST NATIONAL BANK OF CHICAGO,
NOT IN ITS INDIVIDUAL CAPACITY
EXCEPT AS EXPRESSLY SET FORTH HEREIN,
AND OTHERWISE SOLELY AS PASS THROUGH TRUSTEE
UNDER A PASS THROUGH TRUST AGREEMENT,
DATED AS OF JULY 15, 1994, WITH NEWMONT GOLD COMPANY
and
NEWMONT GOLD COMPANY
as LESSEE
================================================================================
NEWMONT GOLD ORE TREATMENT FACILITY
TRUST [NO. 1][NO. 2]
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
SECTION 1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 2. Pass Through Certificates; Notes . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 3. Participation by the Owner Participant . . . . . . . . . . . . . . . . . . . . 2
SECTION 4. Purchase, Sale, Financing and Lease of the Undivided
Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 5. Notice of Closing; Closing . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 6. Representations, Warranties and Agreements of the Pass
Through Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 7. Representations, Warranties and Agreements of the Owner
Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 8. Representations, Warranties and Agreements of the Owner
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 9. Representations, Warranties and Agreements of the Indenture
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 10. Representations, Warranties and Agreements of Newmont . . . . . . . . . . . . 12
SECTION 11. Conditions Precedent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 12. Consent to Assignment of the Lease; Consent to Indentures . . . . . . . . . . 32
SECTION 13. Indemnities and Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 14. Redemption of Notes Upon a Refunding. . . . . . . . . . . . . . . . . . . . . 40
</TABLE>
(i)
<PAGE> 3
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
SECTION 15. Transaction Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 16. Brokerage and Finders' Fees and Commissions . . . . . . . . . . . . . . . . . . . . . 42
SECTION 17. Owner Participant's Transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 18. Survival of Representations and Warranties; Binding Effect . . . . . . . . . . . . . . 45
SECTION 19. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 20. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
APPENDIX A Definitions
SCHEDULE 1 Notice of Closing and Certificate*
SCHEDULE 2 Schedule of Governmental Actions*
SCHEDULE 3 Schedule of Liens
</TABLE>
EXHIBITS
<TABLE>
<S> <C>
EXHIBIT A Trust Agreement
EXHIBIT B Lease
EXHIBIT C Indenture
EXHIBIT D Pass Through Trust Agreement
EXHIBIT E Tax Indemnity Agreement [Newmont and
Owner Participant only]
EXHIBIT F Ground Lease and Easement*
EXHIBIT G Support Agreement
* To be in form and substance reasonably satisfactory to the Lessee and the Owner Participant on or prior to the Closing
Date.
</TABLE>
(ii)
<PAGE> 4
<TABLE>
<S> <C>
EXHIBIT H Assignment of Contracts*
EXHIBIT I Bill of Sale
EXHIBIT J Form of Opinion of Owner Participant's Counsel*
EXHIBIT K Form of Opinion of John S. Savage, Esq.*
EXHIBIT L Form of Opinion of Owner Trustee's Counsel*
EXHIBIT M Form of Opinion of Indenture Trustee's Counsel*
EXHIBIT N Form of Opinion of Newmont's Counsel*
EXHIBIT O Form of Opinion of Newmont's General Counsel*
EXHIBIT P-1 Form of Opinion of Owner Participant's Nevada Counsel*
EXHIBIT P-2 Form of Opinion of Newmont's Nevada Counsel*
EXHIBIT Q Form of Opinion of Pass Through Trustee's Counsel*
EXHIBIT R Form of Owner Participant Transfer Agreement*
</TABLE>
* To be in form and substance reasonably satisfactory to the Lessee
and the Owner Participant on or prior to the Closing Date.
(iii)
<PAGE> 5
PARTICIPATION AGREEMENT
THIS PARTICIPATION AGREEMENT, dated as of July 15, 1994, among
PHILIP MORRIS CAPITAL CORPORATION, a Delaware corporation (the Owner
Participant), SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION, a national
banking association, not in its individual capacity (Shawmut) except as
expressly set forth herein, and otherwise solely as owner trustee (the Owner
Trustee or the Lessor) under Trust Agreement [No. 1][No. 2] referred to herein,
THE FIRST NATIONAL BANK OF CHICAGO, a national banking association, not in its
individual capacity (First Chicago) except as expressly set forth herein, and
otherwise solely as indenture trustee (the Indenture Trustee) under the
Indenture referred to herein, THE FIRST NATIONAL BANK OF CHICAGO, a national
banking association, not in its individual capacity except as expressly set
forth herein, and otherwise solely as pass through trustee (the Pass Through
Trustee) under the Pass Through Trust Agreement referred to herein, and NEWMONT
GOLD COMPANY, a Delaware corporation (Newmont or the Lessee).
W I T N E S S E T H :
WHEREAS, the Owner Participant desires to acquire, through the
Trust, the Undivided Interest and to cause the Owner Trustee to lease the
Undivided Interest to the Lessee under the Lease; and
WHEREAS, Newmont is willing to sell the Undivided Interest to
the Trust and to lease the Undivided Interest back from the Lessor under the
Lease.
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto agree as follows:
SECTION 1. DEFINITIONS.
For the purposes hereof, capitalized terms used herein and not
otherwise specifically defined herein shall have the meanings assigned to them
in
<PAGE> 6
Appendix A hereto. References in this Agreement to sections, paragraphs and
clauses are to sections, paragraphs and clauses in this Agreement unless
otherwise indicated.
SECTION 2. PASS THROUGH CERTIFICATES; NOTES.
Subject to the satisfaction of the conditions of paragraph (a)
of Section 5 and Section 11, and subject to the receipt by the Pass Through
Trustee of the proceeds of the Pass Through Certificates issued and sold
pursuant to the Underwriting Agreement, on the Closing Date the Pass Through
Trustee shall purchase from the Owner Trustee Notes in aggregate original
principal amount, and for an aggregate purchase price, equal to the product
obtained by multiplying the Loan Percentage by Facility Cost (the amount of
such purchase, the Loan). The proceeds of the Loan (collectively the Loan
Proceeds) shall be paid directly to the Indenture Trustee in immediately
available funds by transfer to an account of the Indenture Trustee at Chemical
Bank. The Loan shall be evidenced by Notes issued by the Owner Trustee under
and pursuant to the Indenture and such Notes shall be in the principal amount,
bear interest at the rates per annum, and be payable as to principal, premium,
if any, and interest on the dates, set forth in the Notice of Closing and in
the Supplemental Indenture creating such Notes.
SECTION 3. PARTICIPATION BY THE OWNER PARTICIPANT.
(a) Subject to the satisfaction of the conditions of
paragraph (a) of Section 5 and Section 11, on the Closing Date the Owner
Participant agrees to make an investment with respect to the Undivided Interest
in an amount (the Investment) equal to the product obtained by multiplying the
Investment Percentage by Facility Cost; provided however, that the Investment
shall not exceed the Owner Participant's Maximum Investment Commitment. The
proceeds of the Investment shall be paid directly to the Owner Trustee, in
immediately available funds, by transfer to an account of the Owner Trustee at
Chemical Bank.
(b) If the Owner Participant shall have made its
Investment on the Closing Date, so long as no Event of Default or Bankruptcy
Default shall have occurred and be continuing and no Event of Loss shall have
occurred, the Owner Participant agrees solely for the benefit of the Lessee to
make an additional investment on July 5, 1995, in an amount (the Additional
Investment) equal to the aggregate amount of all accrued and unpaid interest on
the Notes due
-2-
<PAGE> 7
and payable and unpaid on such date; provided, however, that the Additional
Investment, when added to the Investment shall not exceed the Owner
Participant's Maximum Investment Commitment. The proceeds of the Additional
Investment shall be paid directly to the Indenture Trustee, in immediately
available funds, prior to 11:00 a.m. on July 5, 1995, by transfer to the
Indenture Trustee as payment of Interim Rent on behalf of the Lessee.
SECTION 4. PURCHASE, SALE, FINANCING AND LEASE OF THE
UNDIVIDED INTEREST.
Subject to the satisfaction of the conditions of paragraph (a)
of Section 5 and Section 11 and receipt from (i) the Owner Participant of its
Investment, and (ii) Pass Through Trustee of the Loan Proceeds, at the Closing
on the Closing Date the Owner Trustee agrees to purchase, and Newmont agrees to
sell, the Undivided Interest for a purchase price (the Purchase Price) equal to
the Facility Cost, and the Owner Trustee agrees to lease the Undivided Interest
to the Lessee, and the Lessee agrees to lease the Undivided Interest from the
Owner Trustee, pursuant to the Lease.
SECTION 5. NOTICE OF CLOSING; CLOSING.
(a) Notice of Closing. On the date on which the
Registration Statement becomes effective, which date is expected to be no
earlier than September 1, 1994, and no later than September 30, 1994, Newmont
shall deliver to the other parties hereto not less than five, nor more than
fifteen, Business Days' prior written notice of the Closing, which notice shall
be given pursuant to a notice of closing (the Notice of Closing) substantially
in the form of Schedule 1 hereto, with the blanks therein completed on the
basis of calculations provided by the Owner Participant and, in the case of the
rates of interest, maturities and other terms of the Notes, by the
Underwriters.
(b) Closing. Upon satisfaction of the conditions of the
preceding paragraph (a) and Section 11, at a closing, which shall occur not
later than 11:00 a.m. on the Closing Date (the Closing), the Owner Trustee
shall (i) make the Owner Participant's Investment available to the Indenture
Trustee, in immediately available funds, by transfer to the Indenture Trustee,
(ii) direct the Indenture Trustee to apply the proceeds of the Notes for the
purposes set forth in Section 4 and (iii) cause the Indenture Trustee to pay
the Purchase Price to Newmont, in
-3-
<PAGE> 8
immediately available funds, by transfer to an account of Newmont at Chemical
Bank.
SECTION 6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE
PASS THROUGH TRUSTEE.
(a) Representations and Warranties. First Chicago, as
Pass Through Trustee and in its individual capacity represents and warrants
that:
(i) Due Organization. First Chicago is a national
banking association duly organized and validly existing in good
standing under the laws of the United States of America and has the
corporate power and authority to enter into and perform its
obligations under the Pass Through Trust Agreement, this Agreement and
each other Transaction Document to which it is, or is to become, a
party, individually and as Pass Through Trustee and to issue,
authenticate and deliver the Pass Through Certificates.
(ii) Due Authorization. The execution, delivery and
performance of this Agreement and each other Transaction Document to
which First Chicago is, or is to become, a party individually and as
Pass Through Trustee have been duly authorized by First Chicago (in
its individual capacity or as Pass Through Trustee, as the case may
be).
(iii) Execution. This Agreement and each other Transaction
Document to which First Chicago is, or is to become, a party (in its
individual capacity or as Pass Through Trustee, as the case may be)
have been, or on or before the Closing Date will have been, duly
executed and delivered by First Chicago or the Pass Through Trustee
and constitute, or upon execution and delivery thereof will, assuming
the due authorization, execution and delivery thereof by the other
parties thereto, constitute legal, valid and binding obligations of
First Chicago or the Pass Through Trustee, as the case may be,
enforceable against First Chicago or the Pass Through Trustee, as the
case may be, in accordance with their respective terms, except as
enforceability may be limited by bankruptcy, insolvency or other
similar laws affecting the enforcement of creditors' rights generally.
-4-
<PAGE> 9
(iv) No Violation. The execution and delivery by (x)
First Chicago of the Pass Through Trust Agreement and this Agreement,
to the extent First Chicago is a party thereto and hereto in its
individual capacity, and (y) the Pass Through Trustee of this
Participation Agreement and each other Transaction Document to which
the Pass Through Trustee is, or is to become, a party, are not or will
not be, and the performance by First Chicago, in its individual
capacity or as Pass Through Trustee, as the case may be, of its
obligations under each will not be, inconsistent with the articles of
association or by-laws of First Chicago, and do not and will not
contravene any Governmental Rule of the United States of America or
the State of Illinois governing the banking or trust powers of First
Chicago, and do not and will not contravene any provision of, or
constitute a default under, any indenture, mortgage, contract or other
instrument to which First Chicago is a party or by which it is bound
or require any Governmental Action relating to the banking or trust
powers of First Chicago under any Federal or Illinois law, except such
as have been, or on or before the Closing Date will have been, duly
obtained, given or accomplished.
(v) Defaults. To the best knowledge of First Chicago, no
Default or Indenture Default has occurred and is continuing. Neither
First Chicago, in its individual and trustee capacity, nor the Pass
Through Trustee is in violation of any of the terms of this Agreement
or any other Transaction Document to which it is, or is to become, a
party.
(vi) Litigation. There is no action, suit, investigation
or proceeding pending or, to the knowledge of First Chicago,
threatened against First Chicago or the Pass Through Trustee before
any Governmental Authority or arbitrator and which relates to First
Chicago's banking or trust powers and which, individually or in the
aggregate, if decided adversely to the interests of First Chicago,
would have an adverse effect upon the ability of First Chicago to
perform its obligations under this Agreement or any other Transaction
Document to which it is, or is to become, a party.
(b) Agreements. First Chicago agrees, in its individual
capacity that:
(i) Discharge of Liens. First Chicago will not create or
permit to exist, and will, at its own cost and expense, promptly take
such action as may be necessary duly to discharge all Liens on any
part of the
-5-
<PAGE> 10
Indenture Estate which result from claims against First Chicago not
related to the Indenture, the Deed of Trust, the Pass Through Trust
Agreement or the transactions contemplated by the Transaction
Documents.
(ii) Assignments. The Pass Through Trustee shall not
transfer or assign to any financial institution, or other Person or
entity, all or any portion of its or the Pass Through Trustee's rights
and obligations under this Agreement or any Transaction Document,
except to a successor trustee under, and in accordance with the terms
and provisions of, the Pass Through Trust Agreement.
(iii) Quiet Enjoyment. Except in respect of the Pass
Through Trustee's rights as Holder of Notes, the Lessee's use of the
Facility shall not be interrupted by the Pass Through Trustee or First
Chicago or any Person claiming through or under the Pass Through
Trustee or First Chicago.
(iv) Pass Through Trust Agreement. Neither First Chicago
nor the Pass Through Trustee shall consent to any amendment,
modification or change to the Pass Through Trust Agreement without the
prior written approval of the Owner Participant and, if no Event of
Default or Bankruptcy Default shall have occurred and be continuing,
the Lessee.
SECTION 7. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE
OWNER PARTICIPANT.
(a) Representations and Warranties. The Owner
Participant represents and warrants that:
(i) Due Organization. The Owner Participant is a
corporation duly organized and validly existing in good standing under
the laws of the State of Delaware and has the corporate power and
authority to enter into and perform its obligations under this
Agreement and each other Transaction Document to which it is, or is to
become, a party.
(ii) Due Authorization. This Agreement and each other
Transaction Document to which it is, or is to become, a party have
been duly authorized by all necessary corporate action on the part of
the Owner Participant and do not require the consent or approval of
stockholders of the Owner Participant or any trustee or holder of any
indebtedness or
-6-
<PAGE> 11
other obligation of the Owner Participant, except such as have been,
or on or before the Closing Date will have been, duly obtained, given
or accomplished.
(iii) Execution. This Agreement and each other Transaction
Document to which it is, or is to become, a party have been, or on or
before the Closing Date will have been, duly executed by the Owner
Participant and constitute, or upon execution and delivery thereof
will constitute, legal, valid and binding obligations of the Owner
Participant, enforceable against it in accordance with their
respective terms, except as enforceability may be limited by
bankruptcy, insolvency or other similar laws affecting the enforcement
of creditors' rights generally.
(iv) No Violation. Neither the execution, delivery or
performance by the Owner Participant of this Agreement or any other
Transaction Document to which it is, or is to become, a party, nor the
consummation by the Owner Participant of the transactions contemplated
hereby or thereby, nor compliance by the Owner Participant with the
provisions hereof or thereof conflicts or will conflict with, or
results or will result in the breach of any provisions of, the
certificate of incorporation or by-laws of the Owner Participant, any
Governmental Rule or any indenture, mortgage, contract, lease or other
instrument to which the Owner Participant is a party or by which it or
any of its property is bound or require any Governmental Action,
except such as have been, or on or before the Closing Date will have
been, duly obtained, given or accomplished; provided, however, that
the Owner Participant makes no representation or warranty as to the
Facility or any Governmental Rule or the requirements of any
Governmental Action relating to the environment, health or safety or
the use or operation of the Facility, the Facility Site or the
Undivided Interest.
(v) No Owner Participant's Liens. Neither the execution
by the Owner Participant of this Agreement or any other Transaction
Document to which it is, or is to become, a party, nor the performance
by the Owner Participant of its obligations hereunder or thereunder,
will subject the Trust Estate or the Indenture Estate, or any portion
of either thereof, to any Owner Participant's Lien.
(vi) Acquisition for Investment. The Owner Participant is
acquiring its beneficial interest in the Trust Estate for its own
account, for investment, and not with a view to, or for sale in
connection with, any distribution thereof.
-7-
<PAGE> 12
(vii) ERISA. No part of the funds to be used by the Owner
Participant to acquire its beneficial interest in the Trust Estate
constitutes assets of any ERISA Plan.
(viii) Tangible Net Worth. The Owner Participant has a
Tangible Net Worth of at least $100,000,000.
(b) Agreements. The Owner Participant agrees that:
(i) Owner Participant's Liens. The Owner Participant
will not create or permit to exist, and it will, at its own cost and
expense, promptly take such action as may be necessary duly to
discharge, or cause to be discharged, all Owner Participant's Liens.
(ii) Transfers. Any transfer or assignment by the Owner
Participant of its interest in the Trust Estate (other than its right
to receive Excepted Payments) or any of the Transaction Documents
shall be subject to, and shall be effected in accordance with, the
terms and conditions hereof and of the Trust Agreement.
(iii) Quiet Enjoyment. The Owner Participant agrees that
unless an Event of Default or Bankruptcy Default shall have occurred
and be continuing, it will not take any action to interrupt the
Lessee's possession, use and enjoyment of the Facility.
(iv) No Amendment. The Owner Participant agrees that it
will not amend or supplement, or consent to any amendment of or
supplement to, the Trust Agreement if such amendment or supplement
would adversely affect the rights of the Holders under the Indenture
or the Notes or the rights of Newmont under the Lease, as the case may
be, or revoke the trust created thereunder without the prior written
consent of (x) the Indenture Trustee, and (y) unless an Event of
Default or Bankruptcy Default has occurred and is continuing, Newmont.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE OWNER
TRUSTEE.
(a) Representations and Warranties. Shawmut, as Owner
Trustee and (except as otherwise provided in the last sentence of this Section
8(a)) in its individual capacity, represents and warrants that:
-8-
<PAGE> 13
(i) Due Organization. Shawmut is a national banking
association duly organized and validly existing in good standing under
the laws of the United States of America and has the corporate power
and authority to enter into and perform its obligations under (x) the
Trust Agreement and, to the extent it is a party hereto in its
individual capacity, this Agreement and, (y) acting as Owner Trustee,
this Agreement and each other Transaction Document to which the Owner
Trustee is, or is to become, a party.
(ii) Due Authorization; Enforceability, etc. This
Agreement and each other Transaction Document to which Shawmut is, or
is to become, a party (in its individual capacity or as Owner Trustee,
as the case may be) has been, or on or before the Closing Date will
have been, duly executed and delivered by Shawmut or the Owner
Trustee, as the case may be, and constitute, or, upon execution and
delivery hereof and thereof, will constitute legal, valid and binding
obligations of Shawmut or the Owner Trustee, as the case may be,
enforceable against Shawmut or the Owner Trustee, as the case may be,
in accordance with their respective terms, except as enforceability
may be limited by bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally.
(iii) Notes. Upon execution of the Notes by the Owner
Trustee, authentication thereof by the Indenture Trustee pursuant to
the Indenture and delivery thereof against payment therefor in
accordance with this Agreement and the Indenture, the Notes will
constitute legal, valid and binding obligations of the Owner Trustee,
enforceable against the Owner Trustee in accordance with their terms,
except as enforceability may be limited by bankruptcy, insolvency or
other similar laws affecting the enforcement of creditors' rights
generally.
(iv) No Violation. The execution and delivery by (x)
Shawmut of the Trust Agreement and, to the extent Shawmut is a party
hereto in its individual capacity, this Agreement, and (y) the Owner
Trustee of this Agreement and each other Transaction Document (other
than the Trust Agreement) to which the Owner Trustee is, or is to
become, a party, are not or will not be, and the performance by
Shawmut or by the Owner Trustee, as the case may be, of its
obligations under each will not be, inconsistent with the articles of
association or by-laws of Shawmut and do not and will not contravene
any Governmental Rule of the United States of America or the State of
Connecticut governing the banking or trust
-9-
<PAGE> 14
powers of Shawmut, and do not and will not contravene any provision
of, or constitute a default under, any indenture, mortgage, contract
or other instrument to which Shawmut is a party or by which it is
bound or require any Governmental Action under any Federal or
Connecticut law governing its banking and trust powers, except such as
have been, or on or before the Closing Date will have been, duly
obtained, given or accomplished; provided, however, that no
representation is made with respect to the right, power or authority
of Shawmut or the Owner Trustee to act as operator of the Undivided
Interest or the Facility following an Event of Default or the
termination or expiration of the Lease.
(v) Defaults. To the best knowledge of Shawmut, no
Indenture Default or Indenture Event of Default caused by or relating
to either Shawmut or the Owner Trustee has occurred and is continuing.
Neither Shawmut, in its individual or trust capacity, nor the Owner
Trustee is in violation of any of the terms of this Agreement or any
other Transaction Document to which it is, or is to become, a party.
(vi) Litigation. There is no action, suit, investigation
or proceeding pending or, to the knowledge of Shawmut, threatened
against Shawmut or the Owner Trustee before any court, arbitrator or
administrative or governmental body and which relates to Shawmut's
banking or trust powers or the rights of the Owner Trustee which,
individually or in the aggregate, if decided adversely to the
interests of Shawmut or the Owner Trustee, as the case may be, would
have an adverse effect upon the ability of Shawmut to perform its
obligations under this Agreement or any other Transaction Document to
which it is, or is to become, a party or of the Owner Trustee to
perform its obligations under this Agreement, the Trust Agreement or
any other Transaction Document to which the Owner Trustee is, or is to
become a party.
(vii) Location of the Chief Place of Business and Chief
Executive Office, etc. The chief place of business and chief
executive office of the Owner Trustee and the office where its records
concerning the accounts or contract rights relating to the
transactions contemplated hereby are kept or located in Hartford,
Connecticut.
Notwithstanding the foregoing provisions of this Section 8(a), the
representations and warranties (x) in Section 8(a)(ii) and Section 8(a)(iii) as
to Transaction Documents and the Notes being legal, valid and binding
obligations enforceable
-10-
<PAGE> 15
in accordance with their respective terms, to the extent Shawmut is, or is to
become, a party thereto in its capacity as Owner Trustee, and (y) in Section
8(a)(v), are given only by Shawmut in its capacity as Owner Trustee and not in
its individual capacity.
(b) Agreements. Shawmut agrees, in its individual
capacity, that:
(i) Discharge of Liens. Shawmut will not create or
permit to exist, and will, at its own cost and expense, promptly take
such action as may be necessary duly to discharge, all Lessor's Liens.
(ii) Certain Amendments. Unless an Event of Default or
Bankruptcy Default has occurred and is continuing, Shawmut will not
amend any of the payment terms of any of the Notes, or take, or permit
any other Person to take, any action to refund any of the Notes after
the date of issue thereof pursuant to the terms of this Agreement or
the Indenture, without the prior written consent of Newmont. Shawmut
will not amend or supplement, or consent to any amendment of, or
supplement to, the Trust Agreement if such amendment or supplement
would adversely affect the rights of the Holders under the Indenture
or the Notes or the rights of Newmont under the Lease, as the case may
be, without the prior written consent of (x) the Indenture Trustee,
and (y) unless an Event of Default or Bankruptcy Default has occurred
and is continuing, Newmont.
(iii) Change in Chief Place of Business and Chief Executive
Office, etc. The Owner Trustee shall promptly notify the Owner
Participant, the Indenture Trustee, the Pass Through Trustee and the
Lessee of any change in the chief place of business, the chief
executive office or the place where the Owner Trustee maintains
records concerning the accounts or contract rights relating to the
transactions contemplated hereby, and shall so notify such parties no
later than 30 days after such change.
SECTION 9. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE
INDENTURE TRUSTEE.
(a) Representations and Warranties. First Chicago, as
Indenture Trustee, and in its individual capacity, represents and warrants
that:
-11-
<PAGE> 16
(i) Due Organization. First Chicago is a national
banking association duly organized and validly existing in good
standing under the laws of the United States of America and has the
corporate power and authority and legal right to enter into and
perform its obligations under the Indenture, this Agreement and each
other Transaction Document to which it is, or is to become, a party
individually or as Indenture Trustee, and, as Indenture Trustee, to
issue, authenticate and deliver the Notes.
(ii) Due Authorization. This Agreement and each other
Transaction Document to which First Chicago is, or is to become, a
party (in its individual capacity or as Indenture Trustee, as the case
may be) has been, or on or before the Closing Date will have been,
duly executed and delivered by First Chicago and constitute, or, upon
execution and delivery hereof and thereof, will, assuming the due
authorization, execution and delivery thereof by the other parties
thereto, constitute legal, valid and binding obligations of First
Chicago (in each such capacity), enforceable against it (in its
respective capacities) in accordance with their respective terms,
except as enforceability may be limited by bankruptcy, insolvency or
other similar laws affecting the enforcement of creditors' rights
generally.
(b) Agreements. The Indenture Trustee agrees that:
(i) Discharge of Liens. First Chicago will not create or
permit to exist, and will, at its own cost and expense, promptly take
such action as may be necessary duly to discharge all liens and
encumbrances on any part of the Indenture Estate which result from
claims against First Chicago in its individual capacity not related to
the transactions contemplated by the Indenture.
(ii) Discharge of Indenture. The Indenture Trustee will
terminate the Indenture when directed to do so pursuant to Section
10.01 thereof.
(iii) Quiet Enjoyment. Except in respect of the
enforcement of remedies under Section 17 of the Lease, the Lessee's
use of the Facility shall not be interrupted by the Indenture Trustee
or any Person claiming by, through or under the Indenture Trustee.
-12-
<PAGE> 17
SECTION 10. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF
NEWMONT.
(a) Representations and Warranties. Newmont represents and
warrants that:
(i) Due Incorporation, etc. Newmont is a corporation
duly organized and validly existing in good standing under the laws of
the State of Delaware and is duly qualified or licensed as a foreign
corporation to do business, and is in good standing, under the laws of
the State of Nevada and any other state of the United States of
America in which the conduct of its business or the ownership or
leasing of assets used in its business requires such qualification and
where the failure to be so qualified would have a material adverse
effect on the operations, business, properties, assets or condition of
Newmont and its consolidated subsidiary taken as a whole. Newmont has
the corporate power and authority to carry on its business as
presently conducted, to own its properties and to hold properties
under lease, and to enter into and perform its obligations under this
Agreement and each other Transaction Document to which it is, or is to
become, a party.
(ii) Authorization. The execution, delivery and
performance by Newmont of this Agreement and each other Transaction
Document to which it is, or is to become, a party have been duly
authorized by all necessary corporate action on the part of Newmont
and do not and will not require the consent or approval of
stockholders of Newmont or any trustee or holder of any indebtedness
or other obligation of Newmont, except such as have been, or on or
before the Closing Date will have been, duly obtained, given or
accomplished.
(iii) Execution. This Agreement and each other Transaction
Document to which it is, or is to become, a party have been, or on or
before the Closing Date will have been, duly executed and delivered by
Newmont and constitute, or upon execution and delivery thereof will
constitute, legal, valid and binding obligations of Newmont,
enforceable against it in accordance with their respective terms,
except as enforceability may be limited by bankruptcy, insolvency or
other similar laws affecting the enforcement of creditors' rights
generally.
(iv) No Violation, etc. Neither the execution, delivery
or performance by Newmont of this Agreement or any other Transaction
Docu-
-13-
<PAGE> 18
ment to which it is, or is to become, a party, nor the consummation
by it of the transactions contemplated hereby or thereby (including
the issuance of the Pass Through Certificates pursuant to the
Underwriting Agreement), nor compliance by Newmont with the
provisions hereof or thereof (a) conflicts or will conflict with, or
results or will result in a breach of any of the provisions of the
certificate of incorporation or by-laws of Newmont, any Governmental
Rule (including the Securities Act), or any indenture, mortgage,
contract, lease or other instrument to which Newmont is a party or by
which it or any of its property is bound, (b) results or will result
in the creation or imposition of any Lien (other than Permitted Liens)
upon any property of Newmont, or (c) results or will result in a
violation or breach of any Governmental Action set forth in Schedule 2
hereto.
(v) Governmental Actions. No Governmental Action is or
will be required in connection with the execution, delivery or
performance by Newmont of, or the operation of the Facility and the
consummation by Newmont of the transactions contemplated by, this
Agreement or any other Transaction Document to which it is, or is to
become, a party, except (A) such Governmental Actions as have been, or
on or before the Closing Date will have been, duly obtained, given or
accomplished, (B) such Governmental Actions as may be required under
existing Governmental Rules to be obtained, given or accomplished from
time to time in connection with the maintenance or operation of the
Facility and which are routine in nature and which Newmont has no
reason to believe may not be timely obtained, and (C) such other
Governmental Actions as may be required under Governmental Rules not
yet enacted or promulgated. Each Governmental Action which is
required for the use and operation of the Facility, and the status
thereof is set forth on Schedule 2 hereto.
(vi) Title to the Undivided Interest. On the Closing
Date, good and marketable title to the Undivided Interest will be
duly, validly and effectively conveyed and transferred to the Owner
Trustee free and clear of all Liens, except Scheduled Liens.
(vii) Ground Lease and Easement. Newmont hereby makes the
representations and warranties of Newmont set forth in the form of
Ground Lease and Easement, which representations and warranties are
incorporated herein by reference as though set forth herein in full.
-14-
<PAGE> 19
(viii) Location of Office. The chief executive office and
chief place of business of Newmont and the office where it keeps its
records concerning its accounts or contract rights is at 1700 Lincoln
Street, Denver, Colorado.
(ix) Financial Statements. (A) The consolidated balance
sheet of Newmont and its consolidated subsidiary (i) as of December
31, 1993 and the related statements of consolidated income, changes in
stockholders' equity and cash flows for the year then ended, together
with the notes accompanying such financial statements, all certified
by Arthur Anderson & Co., and (ii) as of June 30, 1994 and the related
statements of consolidated earnings, for the three and six-month
periods then ended, all certified by the Controller of Newmont, as
furnished to the Owner Participant, fairly present the financial
position of Newmont and its consolidated subsidiary at each such date
and the results of its operations for each of the periods then ended,
in conformity with GAAP applied on a consistent basis.
(B) There has been no material adverse change in the
financial position of Newmont since June 30, 1994, other than as
disclosed to the Owner Participant, the Indenture Trustee and the Pass
Through Trustee in writing on or prior to the date hereof.
(x) Disclosure. (A) Neither the Investment Memorandum,
dated April 1994, nor any other written information furnished by
Newmont to the Owner Participant contained, when taken together with
all other statements and information furnished to the Owner
Participant, any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements contained
therein not misleading, under the circumstances under which any such
statement was made or any such information was furnished.
(B) On the date it becomes effective and on the Closing
Date, the Final Prospectus will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements contained therein not misleading, under the circumstances
under which any such statement shall have been made.
(C) There is no fact known to Newmont that materially and
adversely affects the business or financial condition of Newmont or
any material portion of its U.S. Properties, the use or operation of
the Facility
-15-
<PAGE> 20
or its value or the ability of Newmont to perform its obligations
under this Agreement or any other Transaction Document to which it is,
or is to become, a party except as disclosed in Newmont's Annual
Report on Form 10-K for the fiscal year ended December 31, 1993, or in
Newmont's Quarterly Report on Form 10-Q for the quarter ended March
31, 1994.
(xi) Litigation. There is no action, suit, investigation
or proceeding pending or, to the knowledge of Newmont, threatened
against Newmont before any court, arbitrator or administrative or
Governmental Authority which, individually or in the aggregate, if
decided adversely to the interests of Newmont, would (i) affect the
validity or enforceability of any Transaction Document or (ii) have a
material and adverse effect on the business or financial condition of
Newmont or any material portion of its U.S. Properties, the use or
operation of the Facility, its value or the ability of Newmont to
perform its obligations under this Agreement or any other Transaction
Document to which it is, or is to become, a party, except, in each
case, as disclosed in Newmont's Annual Report on Form 10-K for the
fiscal year ended December 31, 1993, or in Newmont's Quarterly Report
on Form 10-Q for the quarter ended March 31, 1994, or as otherwise
disclosed in writing to the Owner Participant, the Indenture Trustee
and the Pass Through Trustee on or prior to the date hereof.
(xii) Tax Returns. Newmont has filed all Federal, state,
local and foreign tax returns, if any, which were required to be
filed, and has paid all Taxes shown to be due and payable on such
returns, and Newmont has paid all other Taxes in respect of the
Facility and the property subject to, or to become subject to, the
Ground Lease and Easement, in each case to the extent that such Taxes
are payable by Newmont and before they have become delinquent, except
for any Taxes of which the amount, applicability or validity may be in
dispute and which are currently being contested in good faith by
appropriate proceedings and with respect to which Newmont has set
aside on its books reserves (segregated to the extent required by
GAAP) deemed by it to be adequate.
(xiii) Investment Company Act. Newmont is not an
"investment company" or a company "controlled" by an "investment
company," as such terms are defined in the Investment Company Act.
-16-
<PAGE> 21
(xiv) No Default, etc. Upon execution and delivery of the
Lease, no Default or Event of Default shall have occurred and be
continuing, no Event of Loss shall have occurred and no event of
default shall have occurred and be continuing with respect to any U.S.
Financial Obligation.
(xv) ERISA. In reliance upon, and subject to the accuracy
of, the representation made by the Owner Participant in Section
7(a)(vii) and upon the limitations on the offering of the Pass Through
Certificates reflected in Section 6.06 of the Pass Through Trust
Agreement and in the Registration Statement and the Prospectus, the
execution and delivery of this Agreement and the other Transaction
Documents by Newmont and the offering of the Pass Through Certificates
will not involve any prohibited transaction within the meaning of
Section 406 of ERISA or Section 4975 of the Code.
(xvi) Facility Agreements. The rights granted to the
Lessor under the Facility Agreements can reasonably be expected to
provide the Lessor, under normal operating conditions at all times
from the expiration or termination of the Lease to the expiration or
termination of the Ground Lease and Easement, with (i) the leasehold
interests, rights-of-way, easements, facilities, services, materials
and other rights adequate to maintain, repair and replace the
Facility, to the extent of the Undivided Interest, (ii) adequate
ingress and egress from the Facility, to the extent of the Undivided
Interest, and (iii) leasehold interests, rights-of-way, easements,
facilities, services, materials, Governmental Actions and other rights
adequate to operate the Facility, to the extent of the Undivided
Interest, and for such period there are no leasehold interests,
rights-of-way, easements, facilities, services, materials or other
rights (other than Governmental Actions which may be required under
any Governmental Rules applicable after the expiration or termination
of the Lease) required for such operation to such extent other than
those granted by or provided pursuant to the Facility Agreements.
Newmont has no reason to believe that the representations made in this
paragraph will not be true and correct for the period from the
expiration or termination of the Lease to the expiration or
termination of the Ground Lease and Easement.
(xvii) Facility. The Facility has been substantially
completed in accordance with the Plans and Specifications and by the
Closing Date all permits and licenses necessary for the commercial
operation of the Facility (including the Undivided Interest) will have
been received, other than any thereof that are routine in nature and
that cannot be obtained, or are not
-17-
<PAGE> 22
normally applied for, prior to the time they are required, and that
Newmont reasonably expects to obtain in due course. As designed, the
Facility is, and when constructed and placed in service the Facility
will be, capable of being operated for its intended use in full
compliance with all Applicable Laws.
(xviii) Securities Act. Neither Newmont nor anyone
authorized by it has directly or indirectly offered or sold any
interest in the Trust Estate or any part thereof, or in any similar
security or lease, or in any security or lease the offering of which
for the purposes of the Securities Act would be deemed to be part of
the same offering as the offering of the Trust Estate or any part
thereof, or solicited any offer to acquire any of the same in
violation of Section 5 of the Securities Act. The representation and
warranty in the preceding sentence is made by the Lessee in reliance
upon, and is subject to the accuracy of, the representations and
warranties made by the Owner Participant in Section 7(a)(vi) hereof.
(xix) Environmental Matters. The Lessee is complying in
all material respects with all Environmental Laws and the requirements
of any permits issued under such Environmental Laws with respect to
the Site Interest or the Facility. To the Lessee's knowledge, (i) no
Governmental Authority has issued any notice of non-compliance with
any Environmental Law with respect to the Site Interest or the
Facility which has not been satisfied or discharged through
remediation or other appropriate action and no facts or circumstances
exist in response to which a Governmental Authority could validly
issue any such notice, (ii) there are no circumstances that prevents
or interferes with the Lessee's ability to operate and maintain the
Facility as contemplated by the Transaction Documents in material
compliance with any Environmental Law, and (iii) Hazardous Materials
have not at any time been used, stored, released, deposited or
disposed of on or from the Site Interest or the Facility in any way
contrary to the Environmental Laws, except such uses, storages,
releases, deposits or disposals that are not reasonably likely to
result in material liability pursuant to the Environmental Laws.
(xx) Broker's or Finder's Fees. No agent, broker, person
or firm acting on behalf of Newmont, is or will be, entitled to any
commission or broker's or finder's fees from any of the parties
hereto, or from any of their Affiliates, in connection with any of the
transactions contemplated herein, except for the Underwriters and
Chemical Securities Inc., whose commissions or fees and expenses, as
the case may be, will
-18-
<PAGE> 23
either be paid as part of Transaction Expenses or be paid directly by
Newmont, as Newmont may elect on or prior to the Closing Date.
(b) Agreements. Newmont agrees that:
(i) Delivery of Documents. Newmont will deliver
to the Owner Participant, the Owner Trustee and the Indenture Trustee:
(A) within 120 days after the close of each
fiscal year of Newmont occurring after the date hereof,
Newmont's Annual Report to Stockholders together with its
Annual Report on Form 10-K which contains (i) the audited
consolidated balance sheet of Newmont and its consolidated
subsidiary at the end of, and (ii) the related statements of
consolidated income, changes in stockholders' equity and cash
flows for such year; provided, however, that each of such
financial statements will present fairly in all material
respects the consolidated financial position of Newmont and
its consolidated subsidiary at December 31 of such year and
the consolidated results of operations and cash flows for such
year, all in conformity with GAAP and be accompanied by an
opinion of Arthur Andersen & Co., or other independent public
accountants of recognized national standing; provided, further
however, should Newmont cease to be a reporting company under
the Securities Exchange Act, then Newmont shall provide to the
Owner Participant, the Owner Trustee and the Indenture Trustee
together with such financial statements, within 15 days after
it would have been required to file such information with the
SEC, a "Management's Discussion and Analysis of Financial
Condition and Results of Operations", comparable to that which
Newmont would have been required to include in such annual
reports, if Newmont had been subject to the requirements of
the Securities Exchange Act;
(B) within 70 days after the end of each of the
first three quarters of each of its fiscal years, its
Quarterly Report to the Securities and Exchange Commission on
Form 10-Q which contains (i) the unaudited condensed
consolidated balance sheet of Newmont and its consolidated
subsidiary at the end of, and (ii) the related consolidated
statements of income, changes in stockholders' equity and cash
flows for, the interim period ending at the end of such
quarter; provided, however, that each of such financial
-19-
<PAGE> 24
statements will present fairly in all material respects
the consolidated financial position of Newmont and its
consolidated subsidiary at the end of such quarter, and the
consolidated results of operations and cash flows for such
quarter, all in conformity with GAAP; provided, however,
should Newmont cease to be a reporting company under the
Securities Exchange Act, then Newmont shall provide to the
Owner Participant, the Owner Trustee and the Indenture Trustee
together with such financial statements, within 15 days after
it would have been required to file such information with the
SEC, a "Management's Discussion and Analysis of Financial
Condition and Results of Operations," comparable to that which
Newmont would have been required to include in such quarterly
reports, if Newmont had been subject to the requirements of
the Securities Exchange Act;
(C) as soon as practicable after the same have
been filed, a copy of all documents (other than those referred
to in clauses (A) and (B) above) filed by Newmont with the SEC
pursuant to the reporting requirements of the Securities
Exchange Act or provided to its shareholders generally;
(D) simultaneously with the delivery of the
year-end financial statements referred to in (A) above, a
certificate of the Chief Financial Officer or the Treasurer of
Newmont stating that such officer has reviewed, or caused to
be reviewed by other employees of Newmont, this Agreement and
the other Transaction Documents to which Newmont is a party
and has made, or has caused to be made, a review of the
transactions contemplated hereby and thereby and the condition
of Newmont during such preceding fiscal year and whether,
based on such review, there exists on the date of such
certificate any Default, Event of Default or Event of Loss,
and, if any Default, Event of Default or Event of Loss or any
such event exists, specifying the nature and period of
existence thereof and the action Newmont is taking and
proposes to take with respect thereto;
(E) immediately upon Newmont becoming aware of
the existence of a Default, an Event of Default or Event of
Loss, a written notice specifying the nature of such event and
what action Newmont is taking or proposes to take with respect
thereto;
-20-
<PAGE> 25
(F) all reports and permits required under
Governmental Rules to be filed or possessed by the Owner
Participant, the Owner Trustee or the Indenture Trustee with
respect to the Facility;
(G) promptly, (x) after the receipt or
preparation thereof by the Lessee, a copy of (1) any notice of
alleged violation or finding of alleged violation of any
Environmental Law issued by any Governmental Authority, and
(2) any material environmental report, study, assessment or
audit obtained by Lessee from, or provided by the Lessee to,
any Governmental Authority, in each case relating to the
Facility or the Facility Site, and (y) after the Lessee shall
have obtained actual knowledge thereof, a description in
reasonable detail of any condition or occurrence relating to
or affecting the Facility or the Facility Site which is likely
to result in any notice described in clause (x)(1) above,
together with a statement of the Lessee's proposed response
thereto; and
(H) with reasonable promptness, such other data
and information as to the Facility, the Easements or the Site
Interest as from time to time may be reasonably requested by
the Owner Participant.
(ii) Further Assurances. Newmont, at its own cost,
expense and liability, will cause to be promptly and duly taken,
executed, acknowledged and delivered all such further acts, documents
and assurances as the Owner Participant may from time to time
reasonably request in order to more effectively carry out the intent
and purposes of this Agreement and the other Transaction Documents,
and the transactions contemplated hereby and thereby. Newmont, at its
own cost, expense and liability, will cause the Ground Lease and
Easement, the Indenture, the Purchase Documents and all financing
statements, fixture filings and other documents presented for filing
or recording pursuant hereto, to be recorded or filed at such places
and times and in such manner, and will take all such other actions or
cause such actions to be taken, as may be necessary, or as may be
reasonably requested by the Owner Participant, the Owner Trustee or
the Indenture Trustee, in order to establish, preserve, protect and
perfect the good and marketable title of the Owner Trustee to the
Undivided Interest and, so long as any Notes are Outstanding, the
first and prior security interest of the Indenture Trustee in the
Indenture Estate.
-21-
<PAGE> 26
(iii) Maintenance of Corporate Existence. Newmont shall at
all times maintain its existence as a corporation under the laws of
the State of Delaware, and maintain its good standing under the laws
of the State of Nevada and any other State of the United States in
which the conduct of its business or the ownership or leasing of
assets used in its business requires such qualification and where the
failure to be so qualified would have a material adverse effect on the
operations, business, properties, assets or condition of Newmont and
its consolidated subsidiaries taken as a whole, and will do or cause
to be done all things necessary to preserve and keep in full force and
effect its rights (charter and statutory) and franchises derived from
or arising under Applicable Laws of the United States or any state
thereof; provided, however, that Newmont may discontinue any
non-material right or franchise, or, if its board of directors shall
determine that such discontinuance is necessary or desirable in the
conduct of Newmont's business and does not materially and adversely
affect or diminish any right of the Owner Participant, the Owner
Trustee or the Indenture Trustee, any material right or franchise.
(iv) Merger, Sale, etc. Newmont may consolidate or merge
with another corporation, or sell all or substantially all of its
assets to another Person, provided that, (i) after giving effect
thereto, no Event of Default shall have occurred and be continuing,
(ii) no Payment Default or Bankruptcy Default shall have occurred and
be continuing, (iii) in the case of any transaction among Affiliates,
after giving effect to such transaction, the successor corporation
shall (a) own all of the gold reserves and resources, and the related
mining equipment, theretofore owned by Newmont, and (b) have no
material increase in liabilities in relation to the liabilities of
Newmont immediately prior thereto, (iv) in the case of any transaction
other than one among Affiliates, after giving effect thereto, the
successor corporation shall have a Tangible Net Worth equal to or in
excess of the Tangible Net Worth of Newmont immediately prior thereto,
and (v) in the case of a sale of assets, the purchaser shall have
assumed the payment and performance obligations of the Lessee under
the Lease and the other Transaction Documents. Any transaction
permitted by this clause (iv) shall be consummated in accordance with
documents, and on the basis of legal opinions, which are, in both
cases, in form and scope satisfactory to the Owner Participant, the
Owner Trustee and the Indenture Trustee. Prior to such transaction,
the Owner Participant, the Owner Trustee and the Indenture Trustee
shall receive an Officer's Certificate from the chief financial
officer of Newmont certifying compliance with this clause (iv).
-22-
<PAGE> 27
(v) Amendments, etc. to the Pass Through Trust Agreement.
Newmont shall not, without the Owner Participant's prior written
consent, which consent shall not be unreasonably withheld, amend,
modify, supplement or waive any provision of the Pass Through Trust
Agreement.
(vi) Completion of Facility. To the extent that the
Facility has not been completed by the Closing Date, Newmont
undertakes to complete the Facility in accordance with Plans and
Specifications as promptly as possible.
(vii) Closing Date. Newmont will use its best efforts to
cause the Closing Date to occur on or before September 30, 1994.
(viii) Change in Chief Executive Office. Newmont shall
provide the Owner Trustee, the Owner Participant and the Indenture
Trustee, with at least thirty (30) days' prior written notice of any
change in its chief executive office, principal place of business, its
name or the place where Newmont maintains its business records.
SECTION 11. CONDITIONS PRECEDENT.
(a) Conditions Precedent. The obligation (A) of Newmont
to complete the sale and leaseback of the Undivided Interest on the Closing
Date pursuant to Section 4, (B) of the Owner Trustee to sell and of the Pass
Through Trustee to purchase the Notes on the Closing Date pursuant to Section
2, and (C) of the Owner Participant to make its Investment on the Closing Date
pursuant to Section 3, shall be subject to the fulfillment on or prior to the
Closing Date of the following conditions precedent, in each case in form and
substance satisfactory to the Pass Through Trustee, the Owner Participant, the
Owner Trustee, the Indenture Trustee or Newmont, as the case may be.
(i) Notice of Closing; Transaction Documents. In the
case of the Pass Through Trustee, the Owner Participant, the Owner
Trustee and the Indenture Trustee, each shall have received executed
copies, or sets of executed counterparts, of (A) the Notice of
Closing, and (B) each Transaction Document (other than the Tax
Indemnity Agreement), the Registration Statement and the Final
Prospectus.
-23-
<PAGE> 28
(ii) Adjustments to Rent. In the case of the Owner
Participant and Newmont, all adjustments to Basic Rent, Stipulated
Loss Value and Termination Value arising in consequence of changes in
the Pricing Assumptions since the date of this Agreement shall have
been made and shall be mutually acceptable to the Owner Participant
and Newmont as reflective of such changes and sufficient, but only
sufficient, to preserve the Owner Participant's Net Economic Return;
provided, however, that the Lessee shall have no obligation to sell
and leaseback the Undivided Interest hereunder if, a proposed
adjustment to Basic Rent as a consequence of a Tax Law Change would
cause the present value of the sum of Basic Rent Payments through the
Early Buy-Out Date and the Early Buy-Out Price to increase by 100
basis points or more.
(iii) Tax Indemnity Agreement. In the case of the Owner
Participant and Newmont, each shall have received an executed copy, or
sets of executed counterparts, of the Tax Indemnity Agreement.
(iv) Note Issuance Request; etc. In the case of the
Indenture Trustee, (A) it shall have received a request and
authorization, dated the Closing Date, of the Owner Trustee to
authenticate and deliver the Notes conforming to the terms set forth
in the Notice of Closing upon payment to the Indenture Trustee, as
provided in Section 2 hereof, of the Loan Proceeds as specified in the
Notice of Closing; and (B) it shall have received the Original of the
Lease.
(v) Execution and Delivery of Notes; Owner Participant's
Investment. In the case of the Pass Through Trustee, the Owner
Trustee shall have executed, and the Indenture Trustee shall have
authenticated and delivered to, or at the direction of, the Pass
Through Trustee, the Notes evidencing the Loan Proceeds made available
on the Closing Date, as contemplated by Section 2 hereof, and the
Owner Participant shall have made its Investment as contemplated by
Section 3(a) hereof.
(vi) Participation Agreement and Lease. In the case of
Newmont, it shall have received executed copies, or sets of executed
counterparts, of this Agreement, the Lease and the Pass Through Trust
Agreement.
(vii) Due Authorization, Execution and Delivery. All of
the foregoing documents described in clauses (i), (iii), (iv), (v) and
(vi) above shall have been duly authorized, executed and delivered by
the respective
-24-
<PAGE> 29
parties thereto and shall be in full force and effect on the Closing
Date, and the Pass Through Trustee, the Owner Participant, the Owner
Trustee, the Indenture Trustee and Newmont shall have received such
evidence as to such authorization, execution and delivery as any such
Person shall reasonably request.
(viii) Loan Proceeds; Proceeds of Pass Through Certificates.
In the case of the Owner Participant and Newmont, the Pass Through
Trustee shall have made the Loan Proceeds available to the Owner
Trustee on the Closing Date. In the case of the Pass Through Trustee,
all conditions to closing under the Underwriting Agreement shall have
been satisfied and the Pass Through Trustee shall have received the
proceeds of the issuance and sale of Pass Through Certificates in an
amount equal to the sum of the Loan Proceeds and the purchase price of
the notes which the Pass Through Trustee is committed to purchase
pursuant to, and in accordance with the terms and conditions of, the
Other Participation Agreement shall have been made available to the
Pass Through Trustee from the issuance and sale of Pass Through
Certificates pursuant to the Underwriting Agreement.
(ix) No Violation. In the case of the Owner Participant,
the making by the Owner Participant of its Investment shall not
violate any Applicable Law to which the Owner Participant is subject.
(x) Title to Undivided Interest. The Owner Trustee shall
have received good, marketable and valid title to the Undivided
Interest being sold and leased back on the Closing Date free and clear
of all Liens, except Scheduled Liens, as a result of the execution and
delivery by Newmont of the Purchase Documents.
(xi) Title Insurance. In the case of the Owner
Participant and the Indenture Trustee, a title insurance company
licensed to do business in Nevada shall have issued [COMPLETE
FOLLOWING DISCUSSIONS WITH THE TITLE INSURANCE COMPANY AND LOCAL
COUNSEL].
(xii) Survey. [COMPLETE FOLLOWING DISCUSSIONS WITH THE
TITLE INSURANCE COMPANY AND LOCAL COUNSEL].
-25-
<PAGE> 30
(xiii) Recording and Filing. In the case of the Owner
Participant, the Pass Through Trustee and the Indenture Trustee, (A)
financing statements under the Uniform Commercial Code shall have been
duly filed against the Owner Trustee in respect of the security
interests to be created by the Indenture; (B) financing statements and
fixture filings under the Uniform Commercial Code shall have been duly
filed, as precautionary filings, against Newmont in favor of the Owner
Trustee (and assigned to the Indenture Trustee) in respect of the
Undivided Interest; and (C) the Indenture, the Deed of Trust, the Bill
of Sale, a Memorandum of Lease and the Ground Lease and Easement shall
have been duly recorded, in each case in all places specified by Owner
Participant's Counsel and Owner Participant's Nevada Counsel as being
necessary or advisable to perfect and protect such security interests,
mortgage liens and rights, and all recording and filing fees with
respect to the foregoing shall have been paid by Newmont.
(xiv) Representations and Warranties of the Pass Through
Trustee. In the case of the Owner Trustee, the Owner Participant, the
Indenture Trustee and Newmont, the representations and warranties of
the Pass Through Trustee set forth in Section 6(a) shall be true and
correct on and as of the Closing Date with the same effect as though
made on and as of the Closing Date, and such Persons shall have
received an Officer's Certificate of the Pass Through Trustee, dated
the Closing Date, to such effect.
(xv) Opinion of the Pass Through Trustee's Counsel. In
the case of the Owner Participant, the Owner Trustee, the Indenture
Trustee and Newmont, each shall have received a favorable opinion of
the Pass Through Trustee's Counsel, dated the Closing Date and
addressed to such Persons, to the effect set forth in Exhibit Q.
(xvi) Representations and Warranties of the Owner
Participant. In the case of the Pass Through Trustee, the Owner
Trustee, the Indenture Trustee and Newmont, the representations and
warranties of the Owner Participant set forth in Section 7(a) shall be
true and correct on and as of the Closing Date with the same effect as
though made on and as of the Closing Date, and such Persons shall have
received an Officer's Certificate of the Owner Participant, dated the
Closing Date, to such effect and to the further effect that the Owner
Participant has no actual knowledge that an Indenture Event of Default
which is not a Default or Event of Default has occurred and is
continuing on the Closing Date.
-26-
<PAGE> 31
(xvii) Opinion of the Owner Participant's Counsel. In the
case of the Pass Through Trustee, the Owner Trustee, the Indenture
Trustee and Newmont, each shall have received favorable opinions of
Owner Participant's Counsel, and John S. Savage, Esq., in each case
dated the Closing Date and addressed to such Persons, to the effect
set forth in Exhibit J and Exhibit K, respectively.
(xviii) Representation and Warranties of the Owner Trustee.
In the case of the Pass Through Trustee, the Owner Participant, the
Indenture Trustee and Newmont, the representations and warranties of
the Owner Trustee set forth in Section 8(a) shall be true and correct
on and as of the Closing Date with the same effect as though made on
and as of the Closing Date, and such Persons shall have received an
Officer's Certificate of Shawmut and a certificate of the Owner
Trustee, dated the Closing Date, to such effect.
(xix) Opinion of the Owner Trustee's Counsel. In the case
of the Pass Through Trustee, the Owner Participant, the Indenture
Trustee and Newmont, each shall have received a favorable opinion of
Owner Trustee's Counsel, dated the Closing Date and addressed to such
Persons, to the effect set forth in Exhibit L hereto.
(xx) Representations and Warranties of the Indenture
Trustee. In the case of the Pass Through Trustee, the Owner
Participant, the Indenture Trustee and Newmont, the representations
and warranties of the Indenture Trustee set forth in Section 9(a)
shall be true and correct on and as of the Closing Date with the same
effect as though made on and as of the Closing Date, and such Persons
shall have received a certificate of the Indenture Trustee, dated the
Closing Date, to such effect.
(xxi) Opinion of the Indenture Trustee's Counsel. In the
case of the Pass Through Trustee, the Owner Participant, the Indenture
Trustee and Newmont, each shall have received a favorable opinion of
the Indenture Trustee's Counsel, dated the Closing Date and addressed
to such Persons, to the effect set forth in Exhibit M.
(xxii) Representations and Warranties of Newmont. In the
case of the Pass Through Trustee, the Owner Participant, the Owner
Trustee and the Indenture Trustee, the representations and warranties
of Newmont set forth in Section 10(a) and in any other Transaction
Document to which Newmont is a party shall be true and correct on and
as of the Closing
-27-
<PAGE> 32
Date with the same effect as though made on and as of the Closing Date
and no Default, Event of Default or Event of Loss shall have occurred
and be continuing on the Closing Date, and such Persons shall have
received an Officer's Certificate of Newmont, dated the Closing Date,
to such effect and to the further effect that, since June 30, 1994,
(A) there has been no material adverse change in the business or
financial condition of Newmont and its consolidated subsidiary, and
(B) no event has occurred which would materially and adversely affect
the ability of Newmont to perform its obligations under this Agreement
or the other Transaction Documents to which it is, or is to become, a
party.
(xxiii) Opinion of Newmont's Counsel. In the case of the
Pass Through Trustee, the Owner Participant, the Owner Trustee, the
Indenture Trustee and Newmont, each shall have received a favorable
opinion of Newmont's Counsel, dated the Closing Date and addressed to
such Persons, to the effect set forth in Exhibit N.
(xxiv) Opinion of Newmont's General Counsel. ln the case of
the Pass Through Trustee, the Owner Participant, the Owner Trustee,
the Indenture Trustee, each shall have received a favorable opinion of
Newmont's General Counsel, dated the Closing Date and addressed to
such Persons, to the effect set forth in Exhibit O.
(xxv) Opinion of Nevada counsel. In the case of the Owner
Participant, it shall have received a favorable opinion of Owner
Participant's Nevada Counsel and Lessee's Nevada Counsel, each dated
the Closing Date and addressed to such Person, to the effect set forth
in Exhibits P-1 and P-2, respectively.
(xxvi) Tax Opinion of Owner Participant's Counsel. In the
case of the Owner Participant, it shall have received a favorable
opinion of Owner Participant's Counsel, dated the Closing Date and
addressed to such Person, as to such Federal tax matters as the Owner
Participant may reasonably request.
(xxvii) Insurance Certificate. In the case of the Pass
Through Trustee, the Owner Participant, the Owner Trustee and the
Indenture Trustee, each shall have received a certificate of Newmont's
principal insurance broker, or another insurance broker or brokers
reasonably satisfactory to the Owner Participant, showing the
insurance then maintained by Newmont pursuant to the Lease, specifying
the amounts of
-28-
<PAGE> 33
property damage and liability insurance maintained by Newmont and the
risks covered thereby and stating that in the opinion of such broker
such insurance complies with the terms of the Lease, is in full force
and effect with no outstanding claims thereunder and that all premiums
due and payable with respect thereto have been paid in full.
(xxviii) Taxes. In the case of the Pass Through Trustee, the
Owner Participant, the Owner Trustee and the Indenture Trustee, (A)
all Taxes, if any, payable as of the Closing Date in connection with
the execution, delivery, recording and filing of all the documents and
instruments referred to in paragraph (x) of Section 11(a), or in
connection with the original issue, sale and delivery of the Notes and
the making by the Owner Participant of its Investment in the Trust and
the purchase of the Notes by the Pass Through Trustee, and (B) all
sales and use taxes relating to the consummation of the transactions
contemplated hereby and by the other Transaction Documents, including
the issuance of the Notes and the Pass Through Certificates, shall
have been duly paid in full by Newmont, and the Owner Participant, the
Pass Through Trustee and the Indenture Trustee shall have received an
Officer's Certificate of the Lessee, dated the Closing Date, to such
effect.
(xxix) Government Action. In the case of the Pass Through
Trustee, the Owner Participant, the Owner Trustee, the Indenture
Trustee and Newmont, Newmont shall have obtained any Governmental
Action required for (A) the operation of the Facility (including the
Undivided Interest) in the manner used or proposed to be used by
Newmont as described in the Registration Statement, or (B) the
consummation of all the transactions contemplated by this Agreement
and the other Transaction Documents in accordance with their terms,
and Newmont shall have provided an officer's certificate to such
effect.
(xxx) Appraisal. (a) In the case of the Owner Participant,
it shall have received a letter, dated the Closing Date, from the
Independent Appraiser, containing an appraisal, in form and substance
satisfactory to the Owner Participant, of the Undivided Interest,
which appraisal shall reflect the Appraiser's reasonable conclusion
that (A) the estimated useful life of the Facility (including the
Undivided Interest) is 32 years, (B) at the expiration of the Basic
Term and any Fixed Rate Renewal Term the Fair Market Value of the
Undivided Interest, taking into account the effect and existence of
the Facility Agreements, in the hands of a Person (unrelated to
Newmont) who could lease or purchase the Undivided
-29-
<PAGE> 34
Interest from the Owner Trustee for commercial use, is estimated to be
at least equal to 20% of Facility Cost, determined without including
in such value any increase or decrease for inflation or deflation
during the period from the Closing Date through the expiration of the
Basic Term and any Fixed Rate Renewal Term, (C) the fair market value
of the Undivided Interest, taking into account the effect and
existence of the Facility Agreements, is at least equal to Facility
Cost, (D) the Ground Lease Rent is equal to the fair market value of
the interest of the Owner Trustee in the Facility Site, (E) taking
into account the effect and existence of the Facility Agreements, the
use of the Undivided Interest at the expiration of the Basic Term and
any Fixed Rate Renewal Term by a Person unrelated to Newmont is
commercially feasible, (F) on the Early Buy-Out Date the fair market
value of the Undivided Interest, taking into account the effect and
existence of the Facility Agreements, in the hands of a Person
(unrelated to Newmont) who could lease or purchase the Undivided
Interest from the Owner Trustee for commercial use, is estimated to be
at least equal to the Early Buy-Out Price, determined by including in
such value any increase or decrease for inflation or deflation during
the period from the Closing Date through the Early Buy-Out Date, and
(G) at the expiration of the Basic Term the Fair Market Value of the
Undivided Interest, taking into account the effect and existence of
the Facility Agreements, in the hands of a Person (unrelated to
Newmont) who could lease or purchase the Undivided Interest from the
Owner Trustee for commercial use, is estimated to be at least equal to
the Fixed Price Option Price, determined by including in such value
any increase or decrease for inflation or deflation during the period
from the Closing Date through the expiration of the Basic Term.
(b) In the case of the Indenture Trustee and the Pass Through
Trustee, a letter from the Appraiser concerning the matters referred
to in clauses (A), (C), (D) and (E) of paragraph (a) above in form and
substance satisfactory to the Indenture Trustee and the Pass Through
Trustee.
(xxxi) Completion Letter. In the case of the Owner
Participant, the Indenture Trustee and the Pass Through Trustee, each
shall have received a letter, dated the Closing Date, from the
Consulting Engineer in form and substance reasonably satisfactory to
the Owner Participant, stating that:
-30-
<PAGE> 35
(A) (x) The Facility (including the Undivided Interest)
(1) has been substantially completed, subject only to final testing
and adjustment of systems or subsystems which testing customarily
occurs after commercial operation, in accordance with the Plans and
Specifications, (2) has been constructed in a good and workmanlike
manner in accordance with good construction and engineering practice,
the Plans and Specifications and the terms and conditions of all
Governmental Actions, (3) is ready and available for use by the Lessee
and (4) conforms in all material respects to the description thereof
in the Plans and Specifications, (y) there is no reason to believe
that the Facility (including the Undivided Interest) does not have the
capacity and functional ability to perform as specified in the Plans
and Specifications or to perform at maximum operating capability for
sustained periods, and (z) there is no event or condition existing of
which such firm, after due inquiry, is aware, which would in the
future adversely affect the foregoing; and
(B) From an engineering standpoint, the rights conveyed
or granted under the Facility Agreements are sufficient to permit, for
the period of at least 32 years from the Closing Date, (1) the
location, occupation, situation, connection, operation, maintenance,
replacement, renewal and repair of the Facility (including the
Undivided Interest) on the real property subject to the Ground Lease
and Easement, (2) the operation of the Facility (including the
Undivided Interest) by any qualified User in such a manner as can
reasonably be expected to cause the Facility (including the Undivided
Interest) to perform, in commercial operation on a continuing basis,
the functions and at substantially the ratings (except for limitations
which are the result of normal wear and tear) for which the Facility
(including the Undivided Interest) was specifically designed without
reference to or use of any proprietary information of Newmont or any
other Person and (3) adequate ingress to and egress from the Facility
(including the Undivided Interest).
(xxxii) Assignment of Certain Contracts. In the case of the
Pass Through Trustee, the Owner Participant, the Owner Trustee and the
Indenture Trustee, Newmont shall have executed and delivered the
written notice of the Assignment of Contracts, and the respective
counterparties shall have consented to such assignment as provided
therein.
(xxxiii) Other Sale and Leaseback Transactions. In
the case of the Pass Through Trustee and Newmont, a sale and leaseback
-31-
<PAGE> 36
transaction relating to Newmont's interests in the Facility (other
than the Undivided Interest) shall have been completed on the Closing
Date.
(xxxiv) Environmental Reports. In the case of the Owner
Participant, the Pass Through Trustee and the Indenture Trustee, an
environmental audit of the Facility and the Facility Site shall have
been completed by an environmental consultant selected by the Owner
Participant and the results thereof shall have been satisfactory to
such Persons.
(xxxv) No Violation of Law. In the case of any party
hereto, the execution and delivery of this Agreement and the
consummation of any of the transactions contemplated herein or in any
other Transaction Document will not violate any Applicable Law.
(xxxvi) No Pending Litigation. In the case of each party
hereto, no action or proceedings shall have been instituted or
threatened with respect to any other party hereto before a court or
other government body or by any Governmental Authority to restrain or
prohibit any of the transactions contemplated hereby or by any other
Transaction Document.
(xxxvii) Broker's Letter. In case of the Owner
Participant, Newmont and the Owner Participant, each shall have
delivered to it a letter from Chemical Securities Inc. describing the
manner in which the offering of interests in the Undivided Interest
was conducted and indicating the number of Persons to whom such offers
were made.
(b) Matters Relating to Opinions. Each opinion of
counsel delivered pursuant to Section 11 (a) may (A) be subject to appropriate
qualification as to applicable bankruptcy law and other similar laws affecting
creditors' rights generally, and to principles of equity, (B) rely as to
matters, if any, relating to the laws of jurisdictions other than the United
States of America and the jurisdiction as to which such counsel restricts its
opinion, on an opinion or opinions of qualified local counsel reasonably
acceptable to the Persons to which such relying counsel's opinion is addressed;
provided, however, that such relying counsel's opinion shall state that the
party to which such relying counsel's opinion is addressed is justified in
relying upon such opinion of local counsel, (C) state that such opinion is
subject to qualification in respect of the effect of certain laws and judicial
decisions, and equitable principles, upon the enforceability of certain rights
and remedies provided in the Transaction Documents; provided, further, however,
that such opinion shall further state that, in the opinion of such counsel,
-32-
<PAGE> 37
none of such laws in effect on the date of such opinion and none of such
judicial decisions or equitable principles make the rights and remedies
provided in the Transaction Documents, taken as a whole, inadequate for
enforcing payment of the Notes and the security interests provided by the
Indenture or the realization of the benefits of the Transaction Documents, (D)
assume that all agreements with respect to which such opinion is rendered
constitute legal, valid and binding obligations of the parties thereto other
than the party or parties which such counsel represents and (E) state that it
does not purport to pass upon the application of so-called "blue sky" or
securities laws of any jurisdiction other than the state in which such counsel
is admitted to practice.
SECTION 12. CONSENT TO ASSIGNMENT OF THE LEASE; CONSENT TO
INDENTURES.
(a) Consent to Assignment of the Lease. Newmont hereby
acknowledges, and consents in all respects to, the assignment of the Lease by
the Owner Trustee to the Indenture Trustee under and pursuant to the Indenture
and agrees:
(i) to make each payment of Basic Rent and Supplemental
Rent due or to become due thereunder, except all Excepted Payments,
directly to the Indenture Trustee so long as any of the Notes shall be
Outstanding; and
(ii) not to seek to recover any payment made to the
Indenture Trustee in accordance with the Indenture once such payment
is made.
(b) Consent to Indenture. Newmont hereby consents in all
respects to the execution and delivery of the Indenture, and to all of the
terms thereof, and Newmont acknowledges receipt of executed counterparts of the
Indenture; it being understood that such consent shall not be construed to
require Newmont's consent to any future supplement to, or amendment, waiver or
modification of the terms of, the Indenture or any Note. Notwithstanding the
foregoing, and, so long as no Event of Default or Bankruptcy Default shall not
have occurred and be continuing, the provisions of Sections 2.02B, 2.09, 2.13,
2.14 and 2.15, Article V, Article VIII and Article IX and the related
definitions, may not be amended, waived or modified without the written consent
of Newmont.
-33-
<PAGE> 38
SECTION 13. INDEMNITIES AND AGREEMENTS.
(a) Performance of Indemnities. Newmont agrees, whether
or not any of the transactions contemplated hereby shall be consummated, to
assume liability for, and to indemnify, protect, save and keep harmless each
Indemnitee, on an After-Tax Basis, from and against any and all Claims which
may be imposed on, incurred by or asserted against any Indemnitee, whether or
not such Indemnitee shall also be indemnified as to any such Claim by any other
Person, (i) in any way relating to or arising out of this Participation
Agreement, the Lease, any other Transaction Document, the issuance of the Pass
Through Certificates or the performance or enforcement of any of the terms
hereof or thereof (including Claims arising out of any alleged untrue statement
of a material fact, or alleged omission to state a material fact, in the
Registration Statement or the Prospectus), (ii) in any way relating to a
disposition of all or any part of the Undivided Interest in connection with a
termination upon an Event of Default or an Event of Loss or (iii) in any way
relating to or arising out of the design, manufacture, erection, purchase,
acceptance, rejection, financing, ownership, delivery, lease, sublease,
possession, use, operation (including disposal of wastes and other by- products
generated by the operation thereof), maintenance, condition, sale, return,
storage or disposition of the Facility or the Facility Site or any accident in
connection therewith (including latent and other defects, whether or not
discoverable, Environmental Claims and any Claim for patent, trademark,
service-mark or copyright infringement and expenses of any such Indemnitee
incurred in the administration of this Lease, any other Transaction Document,
and not paid as a Transaction Expense or included in Facility Cost, and
reasonable fees and disbursements of outside counsel incurred in connection
therewith); provided, however, that Newmont shall not be required to indemnify
any Indemnitee for (A) any Claim in respect of the Facility or the Undivided
Interest arising from acts or events which occur after possession of the
Undivided Interest has been redelivered to the Owner Trustee in accordance with
the Lease (other than after an Event of Default) unless such act or event was
attributable to acts or events occurring prior to such redelivery, (B) any
Claim resulting from acts which would constitute the gross negligence or
misconduct of, or the breach of any representation or warranty by, such
Indemnitee, (C) any Transaction Expenses to be paid by the Lessor or the Owner
Participant pursuant to this Agreement, (D) any Claim resulting directly from a
transfer by such Indemnitee of all or part of its interest in the Lease, the
Undivided Interest, the Facility or the Trust Estate other than in connection
with an Event of Default, an Event of Loss or the exercise by the Lessor of its
remedies hereunder, (E) the payment of principal, premium, if any, or interest
on the Notes, (F) any Claim with respect to taxes or tax benefits (whether or
not indemnified by the Lessee in any other
-34-
<PAGE> 39
Transaction Document) other than a Claim to receive payments on an After-Tax
Basis as provided hereunder, (G) any Claim relating to or arising out of any
obligation or liability assumed by such Indemnitee in any of the other
Transaction Documents, (H) any Claim resulting from the imposition of any Lien
which such Indemnitee is required to lift or discharge under the terms of this
Lease or any other Transaction Document or (I) any Claim which results from,
arises out of, or is attributable to (i) a violation of Section 406(a) of
ERISA, Section 4975(c)(1)(A)-(D) of the Code or any comparable laws of any
Governmental Authority by such Indemnitee where the Indemnitee had prior
knowledge of the act or omission giving rise to such violation, or where such
violation was attributable to an act or omission of such Indemnitee that
constituted gross negligence or willful misconduct, (ii) a violation by such
Indemnitee of Section 406(b) of ERISA, Section 4975(c)(1)(E) or (F) of the Code
or any comparable laws of any Governmental Authority, or (iii) the
incorrectness of any representation or warranty of such Indemnitee set forth in
the Transaction Documents or the failure by such Indemnitee to perform or
observe any covenant or condition set forth in the Transaction Documents. To
the extent that an Indemnitee in fact receives indemnification payments from
the Lessee hereunder, and so long as no Event of Default or Bankruptcy Default
shall have occurred and be continuing, the Lessee shall be subrogated, to the
extent of any indemnity paid, to such Indemnitee's rights with respect to the
transaction or event requiring or giving rise to such indemnity.
(b) General Tax Indemnity.
(1) Indemnity. Lessee agrees, whether or not any of the
transactions contemplated hereby are consummated, to pay punctually as and when
due and payable, and to indemnify for and hold harmless each Indemnitee on an
After-Tax Basis from, Taxes howsoever imposed, whether imposed upon or with
respect to, or payable by, any Indemnitee (including amounts so payable by any
such Indemnitee as withholding agent), the Lessee, the Facility or the Facility
Site or any part of any thereof, by any Federal, state or local government or
taxing authority in the United States or, if any Component of the Facility is
moved by the Lessee or any Lessee Person during the Lease Term to a location
outside the United States, by any foreign government having jurisdiction over
the Facility, upon or with respect to the Facility or the Facility Site or any
part thereof or interest therein, or upon the manufacture, financing,
refinancing, servicing, maintenance, modification, repair, replacement,
insuring, improvement, importation, exportation, transfer of title, purchase,
erection, installation, de-installation, testing, acceptance or rejection,
ownership, delivery, non-delivery, lease, sublease, transportation, storage,
possession, use, non-use,
-35-
<PAGE> 40
location, operation, condition, sale, abandonment, return or other disposition
thereof, or upon the rentals, receipts or earnings arising therefrom or with
respect to any transactions contemplated by the Transaction Documents, the
Notes, the Pass Through Certificates or any other interest or indebtedness with
respect to the Facility or the Trust Estate or with respect to any contract
relating to the manufacture, construction, acquisition or delivery of the
Facility or otherwise with respect to the transactions contemplated by the
Transaction Documents (or with respect to the Facility Site, the Facility, the
disposition or processing of any waste or hazardous material generated by the
Facility or arising out of the violation of any Applicable Laws applicable to
the Facility, the Facility Site, or the Lessee or any Indemnitee in respect
thereof); provided, however, that the Lessee shall not be obligated to pay:
(i) Taxes imposed on an Indemnitee which have been
included in Facility Cost to the extent such Taxes have been remitted to the
appropriate taxing authority;
(ii) Taxes imposed on an Indemnitee for any period, or
with respect to any act or event occurring, after the expiration or earlier
termination of the Lease other than after an Event of Default, provided that
this exclusion shall not apply to the extent such Taxes relate to events
occurring or matters arising prior to or simultaneously with the expiration or
earlier termination of the Lease;
(iii) Taxes based on or measured by the fees or other
compensation received by the Owner Trustee for acting as Owner Trustee under
the Trust Agreement, by the Indenture Trustee for acting as Indenture Trustee
under the Indenture or by the Pass Through Trustee for acting as trustee under
the Pass Through Trust Agreement;
(iv) Taxes (other than, in each case, Taxes that are, or
are in the nature of, sales, use, rental, property or ad valorem Taxes) imposed
on an Indemnitee by the United States, any state, city or other taxing
authority within the United States or by any foreign government, that are
imposed on, based on or measured by net or gross income or receipts (including
any value added, minimum, alternative minimum or similar Tax, withholding
Taxes, superfund Taxes and any Taxes on or measured by any items of Tax
preference, or that are franchise or other Taxes based upon the privilege of
doing business or the conduct of business that are based on or measured by the
capital or net worth (other than Taxes based on or measured by the capital or
net worth of such Indemnitee which are imposed by the jurisdiction in which the
Facility is located))
-36-
<PAGE> 41
or excess profits of such Indemnitee, or Taxes imposed in lieu of such
franchise or similar Taxes; provided that there shall not be excluded under
this paragraph (iv) any amounts necessary to make any payment required to be
made under this Section 13(b) on an After-Tax Basis;
(v) Taxes imposed on a transferee of an Indemnitee to the
extent of the excess of such Taxes over the amount of such Taxes that would
have been imposed on the transferor, unless such transfer results from the
exercise of remedies after an Event of Default;
(vi) Taxes imposed on an Indemnitee resulting from the
gross negligence or willful misconduct of such Indemnitee;
(vii) Taxes imposed on the Owner Trustee as a result of the
Trust not being treated as a grantor trust or other conduit entity for federal,
state or local Tax purposes;
(viii) Taxes imposed on the Owner Trustee or the Owner
Participant as a result of any transfer or disposition by the Owner Trustee or
the Owner Participant of (A) the Undivided Interest or any interest or
beneficial interest therein or part thereof or (B) the Trust Estate, other than
any such transfer or disposition arising from the exercise of remedies in
connection with an Event of Default;
(ix) Taxes imposed by reason of an Indemnitee not being a
United States person;
(x) Taxes which are the subject of the Tax Indemnity
Agreement;
(xi) Taxes which result from, arise out of, or are
attributable to (i) a violation of Section 406(a) of ERISA, Section
4975(c)(1)(A)-(D) of the Code or any comparable laws of any Governmental
Authority by such Indemnitee where the Indemnitee had prior knowledge of the
act or omission giving rise to such violation, or where such violation was
attributable to an act or omission of such Indemnitee that constituted gross
negligence or willful misconduct, (ii) a violation of Section 406(b) of ERISA,
Section 4975(c)(1)(E) or (F) of the Code or any comparable laws of any
Governmental Authority, or (iii) the incorrectness of any representation or
warranty of such Indemnitee set forth in the Transaction Documents, or the
failure by such Indemnitee to perform or observe any covenant or condition set
forth in the Transaction Documents; or
-37-
<PAGE> 42
(xii) any Tax imposed on or measured by the gross or net
income of the Pass Through Trust or the estate created under the Pass Through
Trust Agreement.
(2) Contests. If a written claim is made against the
Lessee or an Indemnitee or if any proceeding shall be commenced against any
Indemnitee (including a written notice of such proceeding) for any Taxes with
respect to which the Lessee is liable for payment or indemnity under this
Section 13, the Lessee (at its sole expense) may, to the extent it is entitled
to do so under applicable law, contest the validity, applicability or amount of
such claim in its own name. If the provisions of any law, rule or regulation
at the time in effect shall require that any proceedings to contest the
validity, applicability or amount thereof be brought by or in the name of such
Indemnitee, then, if so requested in writing by the Lessee, such Indemnitee
shall permit the same to be brought in such Indemnitee's name or, if the Lessee
is not permitted to conduct such contest in the Lessee's name or in the name of
such Indemnitee, at the sole expense of the Lessee, such Indemnitee shall
contest the validity, applicability or amount thereof in good faith and by such
appropriate proceedings as may be elected by such Indemnitee including, at the
sole discretion of such Indemnitee, by (A) resisting payment of the Tax, (B)
not paying the same except under protest, if protest is necessary and proper,
or (C) if payment is made, using reasonable efforts to obtain a refund in
appropriate administrative or judicial proceedings. In any case in which the
Lessee is not permitted to contest in its own name or in the name of the
Indemnitee, it shall have the right to participate, at its expense, in the
conduct of such contest. Notwithstanding anything to the contrary herein, in
no event shall such Indemnitee be required or the Lessee permitted to contest
in such Indemnitee's name the imposition of any Taxes for which the Lessee is
obligated pursuant to this Section 13(b) unless (i) the Lessee shall have
agreed in writing to pay (and shall pay on demand) any and all expenses
associated with such contest (including all costs, expenses, reasonable legal
and accounting fees and disbursements, penalties and interest), (ii) no Event
of Default or Bankruptcy Default shall have occurred and be continuing, (iii)
such Indemnitee and the Owner Participant shall have determined that the action
to be taken will not result in any danger of sale, forfeiture or loss of, or
the creation of any Lien (except if the Lessee shall have adequately bonded
such Lien or otherwise made provision to protect the interests of such
Indemnitee, the Owner Trustee and the Owner Participant in a manner
satisfactory to such Indemnitee and the Owner Participant) on the Facility or
any interest therein, or result in the risk of any criminal penalties, (iv)
prior to taking any action, or any appeal of an adverse judicial determination,
the Lessee shall have delivered to such Indemnitee, at the Lessee's sole
expense, an opinion of counsel to the effect that a Reasonable Basis
-38-
<PAGE> 43
for such contest or appeal exists; (v) no Indemnitee shall be required to
pursue any contest to the United States Supreme Court; (vi) in the case of a
contest conducted by an Indemnitee, such Indemnitee may, at its sole option,
either pay the tax claimed and sue for a refund or contest the claim in any
permissible forum considering, however, in good faith such requests as the
Lessee and its counsel shall make concerning the most appropriate forum in
which to proceed and other related matters; and (vii) in the case of a contest
conducted by the Lessee, the Lessee shall have acknowledged in writing that it
is obligated to pay the indemnity if the contest is unsuccessful; provided that
such acknowledgement shall be of no force and effect if the contest is resolved
by a court on a basis which establishes that such Tax is not the responsibility
of the Lessee. If any such contest involves payment of the Taxes in question,
the Lessee shall either make such payment directly to the appropriate authority
or advance to such Indemnitee on an interest free basis (and shall indemnify
such Indemnitee from any adverse Tax consequence resulting from such interest
free loan or such payment) funds sufficient to make such payment.
If an Indemnitee shall realize any Tax savings as a result of
any Tax paid or indemnified against by the Lessee under this Section 13(b)
whether by way of deduction, credit offset, allocation or otherwise, or would
have received such a refund or credit but for a counterclaim not indemnified by
the Lessee hereunder (a Tax Savings), and such Tax Savings is not taken into
account in computing the amount of the indemnity required to be paid by the
Lessee hereunder, such Indemnitee shall pay to the Lessee the amount of such
Tax Savings plus any Tax Savings realized by such Indemnitee as a result of a
payment pursuant to this sentence; provided, however, that such Indemnitee
shall not be obligated pursuant to this sentence to pay an amount in excess of
any amount paid by the Lessee to such Indemnitee pursuant to this Section 13(b)
(minus any amounts previously paid to Lessee by such Indemnitee pursuant to
this sentence), provided, further, however, that any Tax Savings not paid to
the Lessee pursuant to the limitation contained in the immediately preceding
proviso shall be carried forward to reduce, pro tanto, any future amounts that
may become payable by the Lessee to such Indemnitee pursuant to this Section
13(b). To the extent and as reasonably requested in writing by the Lessee,
each Indemnitee shall in good faith use reasonable efforts in filing its tax
returns and in dealing with taxing authorities to seek and claim any such Tax
Savings. If any Indemnitee shall obtain a refund (including by way of credit)
of all or any part of any Tax which the Lessee shall have paid for such
Indemnitee or reimbursed such Indemnitee for, then such Indemnitee shall pay to
the Lessee any such refund (including any applicable interest received with
respect to such refund) plus any Tax Savings realized by such Indemnitee as a
result of a payment pursuant to this
-39-
<PAGE> 44
sentence (it being understood that the calculation of such Tax Savings shall
take into account any additional income Taxes incurred by such Indemnitee as a
result of the receipt or accrual of such refund). In no event shall any amount
payable to Lessee pursuant to this paragraph be paid to Lessee while an Event
of Default or Bankruptcy Default has occurred and is continuing.
(3) Payment. The Lessee shall pay any Taxes for which it
is liable pursuant to this Section 13(b) directly to the appropriate taxing
authority, or upon written demand of an Indemnitee which shall describe in
reasonable detail the nature and amount of such Tax and the basis pursuant to
this Section 13(b) for payment by the Lessee, to such Indemnitee, within 30
days of such demand, but in no event prior to the date which is 5 days prior to
the date such Tax is due. Any payment which the Lessee shall be required to
make to or for the account of any Indemnitee with respect to any Taxes subject
to indemnification under this Section 13(b) shall be made on an After-Tax
Basis.
(4) Survival of Obligations. The obligations and
liabilities of the Lessee under this Section 13(b) incurred during the Lease
Term shall continue in full force and effect notwithstanding the assignment or
termination of the Lease, in whole or in part, whether by expiration of time,
by operation of law or otherwise, and are expressly made for the benefit of,
and shall be enforceable by, each Indemnitee, respectively.
(5) Reports. The Lessee agrees to comply with all state
and local laws requiring the filing of ad valorem Tax returns and other reports
with respect to the Facility and the Site Interest. If permitted by applicable
law, the Lessee shall prepare and file all reports or returns required with
respect to any Tax with respect to which the Lessee is required to indemnify
hereunder. If the Lessee shall not be permitted by applicable law to file any
such reports or returns, the Lessee shall prepare any such reports or returns
for signature by the appropriate Indemnitee and shall on a timely basis forward
the same, together with the amount of any Tax payable in connection therewith
to such Indemnitee. Any statements for such Taxes received by an Indemnitee
shall be promptly forwarded to the Lessee by such Indemnitee. The Lessee shall
furnish to the appropriate Indemnitee within 90 days after the date any Taxes
referred to in this Section 13(b) are payable by the Lessee, official receipts
of the appropriate taxing authority or other proof satisfactory to such
Indemnitee of the payment of such Taxes, but only if such Indemnitee shall file
written request with the Lessee for such receipts or other proof.
-40-
<PAGE> 45
(6) Information. Lessee shall provide such information
not within the control of any Indemnitee as is in Lessee's control or is
reasonably available to the Lessee, which such Indemnitee may reasonably
require to enable it to fulfill its tax filing obligations, including but not
limited to its federal, state and local tax filing obligations. All request
for such information shall be directed to the Controller of the Lessee.
(7) Withholding Tax Gross-up. Each payment of Rent shall be
paid when due, free and clear of, and without deduction for, any withholding
Tax to the extent necessary to cause the net payment actually received to be at
least equal to all amounts then due and payable with respect to the Notes.
(8) Reimbursement of Lessee. Each Indemnitee shall indemnify
the Lessee against any Taxes (exclusive of amounts required to make payments on
an After Tax Basis) imposed on such Indemnitee or on payments made to such
Indemnitee which are paid by the Lessee, as payor or withholding agent, and
which are not Taxes required to be indemnified by the Lessee pursuant to
Section 13(b)(1) hereof or the Tax Indemnity Agreement.
(9) Relation to Tax Indemnity Agreement. Nothing contained
in this Section 13 shall be deemed to affect the Lessee's obligations contained
in the Tax Indemnity Agreement.
SECTION 14. REDEMPTION OF NOTES UPON A REFUNDING.
(a) Refunding. So long as no Event of Loss or Default
shall have occurred and be continuing, subject only to the provisions of this
Section 14 and Section 2.14 of the Indenture, not more than twice during the
Lease Term, the Owner Participant shall, upon receipt of a Refunding Notice
from Newmont, cause the Owner Trustee to use its best efforts to redeem all,
but not less than all, of the Notes in a transaction to be arranged by Newmont
with the proceeds of Refunding Securities issued pursuant to Section 2.14 of
the Indenture. On or before the Refunding Date:
(i) the Lessee, the Owner Participant, the Owner Trustee,
the Indenture Trustee and the Pass Through Trustee (and any other
appropriate parties) will enter into a financing or loan agreement
(which may involve an underwriting agreement in connection with a
public offering of pass through certificates relating to the Refunding
Securities) (a Refunding Agreement) providing for (x) the payment by
the Lessee, as
-41-
<PAGE> 46
Supplemental Rent, of the Premium Amount, if any, and, if the
Refunding Date shall not coincide with a Rent Payment Date, all
interest accrued and unpaid on the Notes to, but not including, the
Refunding Date, (y) the issuance and sale by the Owner Trustee to the
Pass Through Trustee (or such other institution or institutions as may
be specified in the Refunding Agreement) on the date set forth therein
or determined thereunder (the Refunding Date, and the closing
occurring on such Date is herein referred to as the Refunding Closing)
of debt securities bearing fixed rates of interest (the Refunding
Securities) which (I) are in an aggregate principal amount equal to
the sum of the unpaid principal amount of the Notes being refunded,
plus the costs and expenses (including any underwriting or placement
commissions or discounts) associated with such issuance and sale, (II)
mature on or prior to the expiration of the Basic Lease Term, (III)
have a Weighted Average Life to Maturity which does not exceed the
remaining Weighted Average Life to Maturity of the Notes refunded,
determined as of the date of the Refunding Closing, by more than six
months; provided, however, that, after giving effect to the issuance
of such Refunding Securities, (A) the aggregate principal amount of
Notes Outstanding under the Indenture shall not exceed 105% of the
remaining principal amount of the Notes issued on the Closing Date,
and (B) the net present value of the Basic Rent payable under the
Lease from the Refunding Date to the end of the Basic Term is less
than the net present value of Basic Rent payable under the Lease
immediately prior to the Refunding and for the period from the
Refunding Date to the end of the Basic Term, and (z) such other terms
and provisions as may be reasonably requested by the Owner
Participant;
(ii) the Owner Trustee will amend the Indenture to the
extent necessary to secure the Refunding Securities and to take or
permit such other action as shall be required to effect the Refunding;
(iii) the Lessee will amend the Lease to reflect the
Refunding and to preserve the Owner Participant's Net Economic Return
from any changes in the Pricing Assumptions in the manner required by
Section 3(f) thereof;
(iv) there shall be a concurrent refunding of the Notes
issued by the Other Owner Trustee on substantially the same terms as
the Refunding Securities; and
-42-
<PAGE> 47
(v) unless financed with the proceeds of the Refunding
Securities or otherwise paid by the Owner Participant in its sole
discretion, the Lessee shall pay as Supplemental Rent all reasonable
fees, costs, and expenses (including the reasonable fees, costs and
expenses of the Owner Participant and its counsel and interest,
premium and other amounts payable in connection with a redemption of
Notes) of any actual or proposed Refunding.
(b) Special Tax Indemnity. If, following the delivery of
a Refunding Notice and prior to the Refunding Date, the Owner Participant shall
provide to the Lessee a written notice that Owner Participant's Counsel cannot
deliver an opinion to the effect that the Owner Participant will not suffer an
unindemnified adverse tax consequence as a result of such Refunding (which
notice will set forth the reason(s) that such opinion cannot be delivered),
then the Owner Trustee and the Owner Participant shall be required to effect
such Refunding only if, prior to the Refunding Closing Date, the Lessee shall
have agreed to indemnify the Owner Participant against the unindemnified
adverse tax consequences of such Refunding; provided, however, that the Owner
Participant agrees that it shall not be entitled to be indemnified for, and the
Owner Trustee and the Owner Participant will be required to effect such
Refunding regardless of, adverse tax consequences (1) with respect to the
principal amount of the Refunding Securities if such principal amount does not
exceed 105% of the then remaining principal amount of the Notes issued on the
Closing Date (provided, that any excess of the principal amount of the
Refunding Securities over the then remaining principal amount of the Notes
issued on the Closing Date is applied solely to the payment of the costs of the
Refunding and no portion thereof is paid or made available to the Lessee), or
(2) with respect to the term of the Refunding Securities if the terms thereof
does not exceed (a) the term of the Notes by more than six months or (b) the
end of the Basic Lease Term, if earlier.
SECTION 15. TRANSACTION EXPENSES.
(a) Transaction Expenses. The Owner Participant hereby
agrees that if the transactions contemplated hereby are consummated on the
Closing Date, it will pay when due all Transaction Expenses. Funds for the
payment of Transaction Expenses will be provided by the Owner Participant to
the Owner Trustee and the Owner Trustee will disburse such funds as agent for
the Owner Participant.
-43-
<PAGE> 48
(b) Post-Closing Expenses. Except with respect to
Transfers pursuant to Section 17, Newmont will pay the reasonable annual fees
and expenses (including reasonable legal fees and expenses) of the Owner
Trustee and the Indenture Trustee and the Pass Through Trustee and the expenses
(including reasonable legal fees and expenses) of the other parties hereto in
connection with any proposed Refunding or proposed Modification financing
pursuant to Section 8(g) of the Lease or any amendment to, modification of, or
waiver or consent under, any provision of this Agreement and any other
Transaction Document.
(c) Contingent Obligation of Newmont. In the event the
transactions contemplated by this Agreement shall not be consummated, Newmont
shall pay or cause to be paid, and shall indemnify and hold harmless the other
parties hereto in respect of, all reasonable Transaction Expenses unless such
failure shall be in consequence of such party's failure to perform its
obligations hereunder or under any other Transaction Document.
SECTION 16. BROKERAGE AND FINDERS' FEES AND COMMISSIONS.
Except to the extent of amounts (i) payable by the Owner
Participant pursuant to Section 15(a) and (ii) due to the Underwriters in
respect of the fees and expenses of such Underwriters in connection with the
transactions contemplated hereby, Newmont will indemnify and hold harmless the
other parties hereto in respect of any commissions, fees, judgments or other
expenses of any nature and kind which any of them may become liable to pay by
reason of any claims by or on behalf of brokers, finders or agents in
connection with the transactions contemplated by the this Agreement or any
other Transaction Document, or any litigation or similar proceeding arising
from such claims (other than those arising out of claims with respect to
contracts made by the Owner Participant). The Owner Participant represents and
warrants that it has not made any contract in respect of any commissions, fees,
judgments or other expenses of the type referred to above, except such as shall
constitute Transaction Expenses and such as shall constitute amounts described
in clause (ii) of the first sentence in this Section 16.
SECTION 17. OWNER PARTICIPANT'S TRANSFERS.
(a) Transfers. After the Closing Date, the Owner
Participant shall not assign, convey or otherwise transfer all or any part of
(including an Undivided Interest in) its right, title or interest in and to
this Agreement, any of the other Transaction Documents or the Trust Estate
(except its right to receive
-44-
<PAGE> 49
Excepted Payments) to any Person (a Transferee) except on the following
conditions:
(i) the Transferee shall enter into an agreement in the
form of Exhibit R hereof whereby such Transferee confirms that it
shall be bound by the terms of this Agreement and each other
Transaction Document as if it had been originally named as the Owner
Participant hereunder;
(ii) prior to the effectiveness of such transfer, the
Transferee shall have provided to Newmont and the Indenture Trustee an
opinion of counsel in form and substance reasonably satisfactory to
Newmont that (x) the agreement specified in clause (i) of this Section
17(a) is a legal, valid and binding agreement of the Transferee
enforceable in accordance with its terms against the Transferee,
except as enforceability may be limited by (A) bankruptcy, insolvency
or other similar laws affecting the enforcement of creditor's rights
generally and (B) other customary exceptions and (y) such transfer
does not violate the Securities Act;
(iii) the Transferee shall be either a financial
institution or a corporation organized under the laws of the United
States, any state thereof or the District of Columbia and shall have,
in any case, a Tangible Net Worth of at least $75,000,000, or the
Transferee's obligations shall be guaranteed by an entity with a
Tangible Net Worth of at least $75,000,000;
(iv) such transfer shall not violate the Securities Act or
any provision of any other Applicable Law, including, without
limitation, ERISA;
(v) the Transferee is not an entity which is, or which
has an Affiliate which is, a Competitor of Newmont;
(vi) such transfer represents the assignment, conveyance
or transfer to the Transferee of the Owner Participant's right, title
and interest in and to at least a 25% interest in the Facility and its
related rights in and to this Agreement, any of the other Transaction
Documents and the Trust Estate to the extent of such interest;
(vii) Newmont shall have received at least thirty (30)
days' prior written notice of such transfer;
-45-
<PAGE> 50
(viii) the Owner Participant shall pay the reasonable
expenses, including legal fees and disbursements, of the Indenture
Trustee and the Pass Through Trustee in connection with their review
of any proposed assignment, conveyance or transfer of all or any
portion of the Undivided Interest and related rights under the
Transaction Documents to confirm compliance by the transferring Owner
Participant with the conditions set forth in clause (i), (ii), (iii),
(iv) and (vi) of this Section 17(a); and
(ix) the Transferee is not an ERISA Plan, or a person
treated as holding the assets of an ERISA Plan.
Upon any such transfer, the transferring Owner Participant shall be released
from its obligations under this Agreement and the other Transaction Documents
to the extent of the interest so transferred.
(b) Transfer Restrictions Not Applicable after Certain
Defaults. Notwithstanding the foregoing, upon the occurrence and continuance
of an Event of Default or a Bankruptcy Default, the Owner Participant may
assign, convey or otherwise transfer at least a 25% interest in the Facility
without being subject to conditions set forth in clauses (v), (vii) or (ix) of
Section 17(a) and Lessee shall not have the right to object to its failure to
satisfy any of the other conditions thereof.
(c) Procedure. If the Owner Participant transfers its
interest hereunder pursuant to this Section 17 it shall give written notice
thereof before such transfer to Newmont, the Owner Trustee, the Indenture
Trustee and the Pass Through Trustee, specifying the name and address for
notices to the Transferee, such other information and evidence as shall be
necessary to establish compliance with this Section 17. In connection
therewith, the parties hereto shall execute and deliver or furnish such
documents as any party hereto shall reasonably request. The Owner Participant
agrees that no transfer of its interest hereunder shall occur on or prior to
the Closing Date.
SECTION 18. SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
BINDING EFFECT.
(a) Survival. All agreements, representations and
warranties contained in this Agreement and in any other Transaction Document,
or in connection herewith or therewith, shall survive, and shall continue in
effect
-46-
<PAGE> 51
following, the execution and delivery of this Agreement and the other
Transaction Documents and the issue and delivery of the Notes.
(b) Binding Effect. All agreements, representations and
warranties in this Agreement and the other Transaction Documents and in any
agreement, document or certificate delivered concurrently with the execution of
this Agreement and the other Transaction Documents, or from time to time
thereafter, shall bind the party making the same and its successors and
permitted assigns and shall inure to the benefit of each party for whom made
and their respective successors and permitted assigns; provided, however, that,
except to the extent permitted by the Lease, Newmont shall not assign any of
its rights or obligations hereunder without the prior written consent of the
Owner Participant, the Owner Trustee and the Indenture Trustee. Except as
otherwise indicated, all references herein to any party to this Agreement and
the other Transaction Documents shall include the permitted successors and
assigns of such party.
SECTION 19. NOTICES.
All communications, notices and consents provided for herein
shall be in writing and shall become effective when delivered by hand or
received by telecopier (with telephonic confirmation of the transmission and
receipt thereof) or registered first-class mail, postage prepaid, or a
nationally recognized overnight courier service:
<TABLE>
<S> <C>
(i) if to Newmont:
Newmont Gold Company
One United Bank Center
1700 Lincoln Street
Denver, CO 80203
Attention: Treasurer
(ii) if to the Owner Participant:
Philip Morris Capital Corporation
800 Westchester Avenue
Rye Brook, NY 10573-1301
Attention: Vice President-Leasing
</TABLE>
-47-
<PAGE> 52
<TABLE>
<S> <C>
(iii) if to the Pass Through Trustee:
The First National Bank of Chicago,
as Pass Through Trustee
One First National Plaza
Suite 0126
Chicago, IL 60670-0126
Attention: Corporate Trust Services
Division
(iv) if to the Owner Trustee:
Shawmut Bank Connecticut, National
Association, as Owner Trustee
777 Main Street
Hartford, CT 06115
(v) if to the Indenture Trustee:
The First National Bank of Chicago,
as Indenture Trustee
One First National Plaza
Suite 0126
Chicago, IL 60670-0126
Attention: Corporate Trust
Services Division
</TABLE>
or at such other address as any party hereto may from time to time designate by
notice duly given in accordance with the provisions of this Section to the
other parties hereto.
SECTION 20. MISCELLANEOUS.
(a) Execution. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which, when so executed and delivered, shall be an
original, but all such counterparts shall together constitute but one and the
same instrument. Fully executed sets of counterparts shall be delivered to and
retained by the Indenture
-48-
<PAGE> 53
Trustee. Although this Agreement is dated as of the date first above written
for convenience, the actual dates of execution hereof by the parties hereto are
respectively the dates set forth opposite the signatures hereto, and this
Agreement shall be effective on the latest of such dates.
(b) Governing Law. This Agreement has been negotiated
and delivered in the State of New York and shall be governed by, and be
construed in accordance with, the laws of the State of New York.
(c) Jurisdiction. Any action or proceeding against any
of the parties hereto relating in any way to this Agreement or any other
Transaction Document may be brought and enforced in the courts of the State of
New York or of the United States for the Southern District of New York, and the
parties hereto irrevocably consent to the jurisdiction of each such court in
respect of any such action or proceeding. Each of the parties hereto further
irrevocably consents to the service of process in any such action or proceeding
by the mailing of copies thereof by registered or certified mail, postage
prepaid, return receipt requested, to such address as provided for notices
under Section 19 hereof. The foregoing shall not limit the right of any party
to serve process in any other manner permitted by law or to bring any action or
proceeding, or to obtain execution of any judgment, in any other jurisdiction.
(d) Venue. Each of the parties hereto hereby irrevocably
waives any objection that it may now or hereafter have to the laying of venue
of any action or proceeding arising under or relating to this Agreement or any
other Transaction Document in any court located in the Borough of Manhattan,
City and State of New York, and hereby further irrevocably waives any claim
that a court located in the Borough of Manhattan, City and State of New York is
not a convenient forum for any such action or proceeding.
(e) Entire Agreement. This Agreement (including the
Exhibits hereto) supersedes all prior agreements, written or oral, between or
among any of the parties hereto and each of the parties hereto represents and
warrants to the others that this Agreement and the other Transaction Documents
constitute the entire agreement among the parties relating to the transactions
contemplated hereby.
(f) Amendments, Supplements, etc. Neither this Agreement
nor any of the terms hereof may be amended, supplemented, waived or modified
orally, but only by an instrument in writing signed by the party against which
enforcement of such change is sought.
-49-
<PAGE> 54
(g) Headings. The headings of the sections and
paragraphs of this Agreement have been inserted for convenience of reference
only and shall in no way restrict or otherwise modify any of the terms or
provisions hereof.
IN WITNESS WHEREOF, the parties hereto have each caused this
Participation Agreement to be duly executed by their respective officers or
authorized signatories thereunto duly authorized as of the dates set forth
below.
PHILIP MORRIS CAPITAL CORPORATION
By
----------------------------------------------------
Date: ,1994 President
SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity, except as
expressly set forth herein, and otherwise
as Owner Trustee under Trust
Agreement [No. 1][No. 2], dated as of July 15,
1994, with Philip Morris Capital
Corporation
By
----------------------------------------------------
Date: ,1994 Trust Officer
-50-
<PAGE> 55
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity, except as
expressly set forth herein, and otherwise as
Indenture Trustee under a Trust
Indenture, dated as of July 15, 1994
By
----------------------------------------------------
Date: , 1994 Trust Officer
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity, except as
expressly set forth herein, and otherwise as Pass
Through Trustee under a Pass Through Trust
Agreement, dated as of July 15, 1994, with
Newmont Gold Company
By
----------------------------------------------------
Date: , 1994 Trust Officer
NEWMONT GOLD COMPANY
By
----------------------------------------------------
Date: , 1994 Treasurer
-51-
<PAGE> 56
APPENDIX A
================================================================================
DEFINITION OF TERMS
================================================================================
NEWMONT GOLD ORE TREATMENT FACILITY
<PAGE> 57
DEFINITION OF TERMS
Rules of Construction: The terms defined herein relate to all
Transaction Documents. Unless the context otherwise requires, any act or code
(and regulations or rules issued thereunder), agreement, document or instrument
referred to in any Transaction Document shall mean such act or code (and such
regulations or rules), agreement, document or instrument as the same may be
amended, modified or supplemented (including by waiver or consent) from time to
time in accordance with Applicable Law, in the case of acts or codes (and such
regulations or rules), or its terms and provisions and as permitted by the
Transaction Documents, in the case of any agreement, document or instrument,
and such reference includes references to all appendices, exhibits, schedules
and other attachments thereto and any agreements, documents and instruments
incorporated therein. Unless the context otherwise requires, (i) "include,"
"including" and "includes" shall be deemed to be followed by the words "without
limitation," whether or not they are in fact followed by such words or words of
like import, (ii) "writing," "written" and comparable terms refer to printing,
typing, lithography and other means of reproducing words in a visible form,
(iii) "hereof," "herein," "hereunder" and comparable terms refer to the entire
agreement, document or instrument in which such terms are used and not to any
particular article, section or other subdivision thereof or any appendix,
exhibit, schedule or other attachment thereto, (iv) references to any gender
include references to all genders, (v) references to the singular include
references to the plural and vice versa, (vi) references in any Transaction
Document or in a act or code (and regulations or rules issued thereunder), or
in an agreement, document or instrument, to an "article," "section" or another
subdivision thereof, or to a "schedule," "exhibit," "appendix" or other
attachment thereto are to an article, section or other subdivision thereof or a
schedule, exhibit, appendix or other attachment thereto, (vii) references to a
Person are also to its successors and permitted assigns, and (viii) references
to a Governmental Authority are also to its successors.
Additional Equity Investment shall have the meaning set forth
in Section 8(g) of the Lease.
Additional Investment shall have the meaning set forth in
Section 3(b) of the Participation Agreement.
Affiliate, with respect to any Person, shall mean any other
Person directly or indirectly controlling or controlled by, or under direct or
indirect common control with, such Person. The term "control" (including the
correlative meanings of the terms "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
policies of such Person, whether through the ownership of voting securities or
by contract or otherwise.
<PAGE> 58
After-Tax Basis shall mean, with respect to any payment
received or deemed to have been received by any Person, the amount of such
payment (the base payment) supplemented by a further payment (the additional
payment) to that Person so that the sum of the base payment plus the additional
payment shall, after deduction of the amount of all Federal, state and local
income Taxes required to be paid by such Person in respect of the receipt or
accrual of the base payment (taking into account any credits or deductions
arising therefrom and the timing whereof), be equal to the base payment. Such
calculations shall be made, with respect to all Taxes other than federal income
taxes, on the basis of the amounts actually required to be paid by the
recipient, and with respect to federal income taxes, on the assumption that the
recipient is subject to federal income taxation at the highest applicable
marginal rates with respect to corporations.
Amortization Deductions shall have the meaning set forth in
the Tax Indemnity Agreement.
Applicable Law shall mean all laws, including Federal, state
and local laws, ordinances, judgments, decrees, injunctions, writs and orders,
and rules, regulations, orders, interpretations, licenses and permits of any
Governmental Authority.
Appraisal Procedure shall mean a procedure whereby, the Lessor
and the Lessee having failed to agree, two independent appraisers, one chosen
by the Lessee and one by the Lessor, shall mutually agree upon the
determinations then the subject of appraisal. The Lessor or the Lessee, as the
case may be, shall deliver a written notice to the other appointing its
appraiser within 15 days after receipt from the other of a written notice
appointing its appraiser. If one party shall fail to appoint its appraiser
within 15 days after receipt from the other party of a written notice
appointing its appraiser, the determination of the single appraiser shall be
final. If within 30 days after appointment of the two appraisers they are
unable to agree upon the amount in question, a third independent appraiser
shall be chosen within ten days thereafter by the mutual consent of such first
two appraisers or, if such first two appraisers fail to agree upon the
appointment of a third appraiser, such appointment shall be made by the
American Arbitration Association, or any organization successor thereto, from a
panel of appraisers having experience in the business of operating a mining
facility and a familiarity with equipment used or operated in such business.
The decision of the third appraiser so appointed and chosen shall be given
within 30 days after the selection of such third appraiser. If three
appraisers shall be appointed and the determination of one appraiser is
disparate from the middle determination by more than twice the amount by which
the other determination is disparate from the middle determination, then the
determination of such appraiser shall be excluded, the remaining two
determinations
-2-
<PAGE> 59
shall be averaged and such average shall be binding and conclusive on the
Lessor and the Lessee; otherwise the average of all three determinations shall
be binding and conclusive on the Lessor and the Lessee.
Assignment of Contracts shall mean the Assignment of
Contracts, dated the Closing Date and substantially in the form of Exhibit H to
the Participation Agreement.
Average Applicable Rate shall mean the weighted average
interest rate borne by Notes issued on the Closing Date.
Bankruptcy Default shall mean a Default under Section 16(5) of
the Lease.
Basic Lease Commencement Date shall mean July 5, 1995.
Basic Rent or Basic Rent Payment shall mean an amount equal to
the greater of (i) the rent payable pursuant to Section 3(a) of the Lease, or
(ii) the rent payable pursuant to Section 3(g) of the Lease.
Basic Term or Basic Lease Term shall mean the period
commencing on the Basic Lease Commencement Date and ending on September 28,
2015, or such shorter period as may result from earlier termination of the
Lease as provided in the Lease.
Bill of Sale shall mean a Bill of Sale, dated the Closing Date
and substantially in the form of Exhibit J to the Participation Agreement.
Business Day shall mean any day other than a Saturday or
Sunday or other day on which banks in New York, New York, Hartford, Connecticut
or Chicago, Illinois are authorized to remain closed.
Carlin Complex shall mean and include the Facility and any
asset or facility of the Company located in the immediate vicinity of Carlin,
Nevada.
CERCLA shall have the meaning given such term in the
definition of Environmental Law.
Certificate of Acceptance shall mean a certificate,
substantially in the form of Exhibit A to the Lease, duly completed and
executed and delivered on the
-3-
<PAGE> 60
Closing Date or, in the case of any Modification acquired by the Lessor
pursuant to the terms of the Lease, a date required by the applicable Lease
Supplement.
Chemical Securities Inc. shall mean Chemical Securities Inc.,
a Delaware corporation.
Claims shall mean liabilities, costs, obligations, losses,
damages, penalties, claims (including, without limitation, claims involving
liability in tort, strict or otherwise), actions, suits, judgments, expenses
and disbursements (including, without limitation, legal fees and expenses) of
any kind and nature whatsoever without any limitation as to amount.
Closing shall mean the proceedings which occur on the Closing
Date, as contemplated by the Participation Agreement.
Closing Date shall mean the date, determined pursuant to a
Notice of Closing, on which the sale and leaseback of the Undivided Interest is
completed, and payment of Facility Cost is made.
Code shall mean the Internal Revenue Code of 1986, as amended,
or any comparable successor law thereto.
Competitor shall mean any Person which, directly or indirectly
through Affiliates, has, during any of the five years preceding the date on
which a "Competitor" is identified, derived more than 20% of its consolidated
operating income, determined in accordance with GAAP, from the mining and
processing of gold.
Components shall mean appliances, parts, instruments,
appurtenances, accessories, furnishings, equipment and other property of
whatever nature that may from time to time be incorporated in the Facility.
Contracts shall have the meaning set forth in the Assignment
of Contracts.
Consulting Engineer shall mean Davy International or such
other firm of construction engineers as shall be selected by the Owner
Participant and approved by the Lessee.
Contractor shall have the meaning set forth in the Assignment
of Contracts.
-4-
<PAGE> 61
Deed of Trust shall mean the Deed of Trust made by the Owner
Trustee in favor of the Indenture Trust securing the Owner Trustee's
obligations under the Notes.
Default shall mean an event which, after giving of notice or
lapse of time, or both, would become an Event of Default.
Depreciation Deductions shall have the meaning set forth in
the Tax Indemnity Agreement.
Early Buy-Out Date shall mean January 5, 2012.
Early Buy-Out Price shall mean an amount, payable in
installments commencing on the Early Buy-Out Date as set forth in Schedule 4
attached to the Lease, equal to the percentage of Facility Cost set forth in
Schedule 4 attached to the Lease as adjusted pursuant to Section 3 of the
Lease, and subject to Section 3(g) of the Lease.
Early Purchase Option shall have the meaning set forth in
Section 14 of the Lease.
Easement shall mean the easement granted by Newmont to the
Owner Trustee under and pursuant to the Ground Lease and Easement.
Environmental Claim shall mean any Claim relating to or
arising under any Environmental Law.
Environmental Law shall mean any Applicable Law which is
applicable to an owner or operator of the Facility, an owner or lessee of the
Site Interest or any waste or other by-products of the Facility and which
relates to the pollution or protection of the environment (including ambient
air, surface water, groundwater, land, surface, and subsurface strata) or
Hazardous Materials, including the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (CERCLA), the Resource
Conservation and Recovery Act, the Hazardous Materials Transportation Act, the
Clean Water Act, the Toxic Substances Control Act, the Clean Air Act, the Safe
Drinking Water Act and the Atomic Energy Act.
ERISA shall mean the Employee Retirement Income Security Act
of 1974, as amended, or any comparable successor law.
ERISA Plan shall mean any "employee benefit plan" subject to
Part 4 of Subtitle B of Title I of ERISA, or "plan" subject to
Section 4975 of the Code, any trust
-5-
<PAGE> 62
created under any such employee benefit plan or plan, or "governmental
plan" as defined in Section 3(32) of ERISA or Section 414(d) of the Code
organized in a jurisdiction having prohibitions on transactions with such
governmental plan similar to those contained in Section 406 of ERISA or Section
4975 of the Code.
Event of Default shall have the meaning set forth in Section
16 of the Lease.
Event of Loss shall mean any of the following events: (a) the
Facility (including the Undivided Interest) or the Site Interest is, or
Lessor's rights in the Easements, as applicable, are (i) destroyed, damaged
beyond repair or, in the good faith and reasonable opinion of the Lessee
(confirmed by an independent engineer reasonably satisfactory to the Owner
Participant) rendered permanently unfit for normal use for any reason
whatsoever, (ii) condemned, confiscated or seized in whole or any significant
part, for a period which extends beyond the expiration of the Basic Lease Term,
or (iii) not operated by the Lessee for its intended use for a period exceeding
two years; or (b) title to the Facility or the Site Interest or any material
portion thereof is, or Lessor's rights in the Easements are, requisitioned.
Excepted Payments shall mean (i) any indemnity payments
(including payments under Section 13 of the Participation Agreement, Section 7
of the Trust Agreement and the Tax Indemnity Agreement, whether made by
adjustment to Basic Rent or other wise) to which the Owner Trustee, in its
individual capacity, the Owner Participant or any of their respective
Affiliates (or the respective successors, assigns, agents, officers, director
or employees of the Owner Trustee or the Owner Participant) is entitled under
the Transaction Documents and all other amounts payable by the Lessee to the
Lessor, Shawmut or the Owner Participant to reimburse any such Person for its
costs and expenses in exercising its rights under the Transaction Documents,
(ii) (A) insurance proceeds, if any, payable to the Lessor, Shawmut, The First
National Bank of Chicago or the Owner Participant under insurance separately
maintained by the Lessor, Shawmut, The First National Bank of Chicago or the
Owner Participant with respect to the Undivided Interest as permitted by the
Lease or (B) proceeds of insurance maintained under any Transaction Document
for the benefit of the Lessor, Shawmut, The First National Bank of Chicago or
the Owner Participant, (iii) any amounts payable under any Transaction Document
to reimburse the Lessor or the Owner Participant (including the reasonable
expenses of the Lessor or the Owner Participant incurred in connection with any
such payment) for performing or complying with any of the obligations of the
Lessee under and as permitted by any Transaction Document, (iv) any amount
payable to the Owner Participant by the Lessee pursuant to the Tax Indemnity
Agreement or any Transferee as the purchase price of the Owner Participant's
interest in the Trust Estate, (v) any payments, insurance proceeds or other
amounts with respect to the Undivided Interest or any portion thereof which
have been released from the lien
-6-
<PAGE> 63
of the Indenture and (vi) any payments in respect of interest to the extent
attributable to payments referred to in clauses (i) through (v) above.
Expenses shall have the meaning set forth in Section 7(a) of
the Trust Agreement.
Facility shall mean the refractory gold ore treatment facility
located approximately six miles north of Carlin, Nevada, as more particularly
described in the Bill of Sale together with any Modifications and all
Components.
Facility Agreements shall mean the Support Agreement, the
Assignment of Contracts, the Ground Lease and Easement and any other agreement,
permit or license or Governmental Action to which the Company is a party and
which are necessary for the operation of the Facility.
Facility Cost shall mean the Lessor's Share of $343,199,000.00.
Facility Site shall mean the Site Interest (as to which the
Owner Trustee has a ground lease interest under the Ground Lease and Easement)
and the other land described in Exhibits A and D to the Ground Lease and
Easement (with respect to which the Owner Trustee is the grantee of an easement
under the Ground Lease and Easement).
Fair Market Renewal Term shall mean a Renewal Term elected
pursuant to Section 13(a)(1) of the Lease.
Fair Market Rental Value or Fair Market Value of any property
or service as of any date shall mean the cash rent or cash price obtainable in
an arm's-length lease, or sale or supply, respectively, between an informed and
willing lessee or buyer (under no compulsion to lease or purchase) and an
informed and willing lessor or seller or supplier (under no compulsion to lease
or sell or supply) of the property or service in question, and shall, in the
case of the Facility, be determined (except pursuant to Section 17(a)(3)(i),
(ii) and (iv) of the Lease) on the basis that (i) the Facility has been
maintained in accordance with, and the Lessee has complied with, the
requirements of the Lease and the other Transaction Documents, (ii) the lessee
or the buyer shall have rights in, or an assignment of, the Transaction
Documents (including, without limitation, the Support Agreements) to which the
Lessor is a party and (iii) the Lessee has complied with the requirements of
the Lease and each Transaction Document to which the Lessee is a party. If the
Lessor and the Lessee are unable to agree upon a determination of Fair Market
Rental Value or Fair Market Value, as the case may be,
-7-
<PAGE> 64
such Fair Market Rental Value or Fair Market Value shall be determined in
accordance with the Appraisal Procedure.
FASB 13 shall mean Statement of Financial Accounting Standards
No. 13, as in effect on the date of the Participation Agreement.
Final Prospectus shall mean the Prospectus included in the
Registration Statement on the date the same becomes effective.
Financing Lease shall mean any lease of equipment and/or real
property which had a cost to the lessor in excess of $80,000,000 under which
the Lessee is a lessee and which had a term of not less than 15 years from the
inception thereof.
First Chicago shall mean The First National Bank of Chicago, a
national banking association, in its individual capacity unless the context
requires otherwise.
Fixed Price Option Price shall mean a purchase price equal to
38% of Facility Cost.
Fixed Rate Renewal Term shall mean a Renewal Term elected
pursuant to Section 13(a)(2) of the Lease.
GAAP shall mean generally accepted accounting principles in
the United States as in effect from time to time.
Governmental Actions shall mean all authorizations, consents,
approvals, waivers, exceptions, variances, filings and declarations of or with,
any Governmental Authority (other than routine reporting requirements the
failure to comply with which will not affect the validity or enforceability of
any of the Transaction Documents or have a material adverse effect on the
transactions contemplated by the Participation Agreement), and shall include,
without limitation, those siting, environmental and operating permits and
licenses which are required for the use and operation of the Facility,
including the Undivided Interest.
Governmental Authority shall mean any Federal, state, county,
municipal, regional or other governmental or taxing authority, agency, board or
court.
Governmental Rules shall mean statutes, laws, rules, codes,
ordinances, regulations, permits, certificates and orders of any Governmental
Authority, including, without limitation, those pertaining to health, safety,
the environment or otherwise.
-8-
<PAGE> 65
Granting Clause Documents shall have the meaning set forth in
Section 1.01 of the Indenture.
Ground Lease and Easement shall mean the Ground Lease and
Easement, dated the Closing Date and substantially in the form of Exhibit F to
the Participation Agreement, and pursuant to which the Owner Trustee and the
Other Owner Trustee will, subject to the conditions set forth therein, lease
from Newmont the Site Interest and accept a grant by Newmont of the Easement.
Ground Lessees shall mean and include the Lessor and the Other
Owner Trustee, as tenants in common.
Ground Lessor shall mean Newmont.
Ground Lease Rent shall have the meaning set forth in the
Ground Lease and Easement.
Group shall mean the affiliated group of corporations of which
the Owner Participant is a member.
Hazardous Materials shall mean any hazardous substance under
Section 101(14) of CERCLA.
Holders shall mean the holders of the Notes.
"incorporated in" shall mean incorporated or installed in,
attached to, or otherwise made a part of the Facility.
Indemnitee shall mean the Owner Participant, Shawmut, the
Owner Trustee, the Indenture Trustee, the Pass Through Trustee, the Trust
Estate, the Indenture Estate and each other holder of a Note from time to time
Outstanding under the Indenture, and the successors, assigns, agents, employees
and directors of each such Person and any Affiliate of each such Person.
Indenture shall mean the Trust Indenture and Security
Agreement, dated as of July 15, 1994, in the form of Exhibit C to the
Participation Agreement.
Indenture Default shall mean an event which, after giving of
notice or lapse of time, or both, would become an Indenture Event of Default.
-9-
<PAGE> 66
Indenture Estate shall have the meaning set forth in Section
1.01 of the Indenture.
Indenture Event of Default shall mean any of the events
specified in Section 6.2 of the Indenture.
Indenture Supplement shall mean any supplemental Indenture
entered into in accordance with the terms of the Indenture (including, as a
result of a Supplemental Financing).
Indenture Trustee shall mean The First National Bank of
Chicago, a national banking association, not in its individual capacity, but
solely as Indenture Trustee under the Indenture, and each successor as
Indenture Trustee under the Indenture.
Indenture Trustee Office shall mean the office of Indenture
Trustee located at One First National Plaza, Suite 0126, Chicago, Illinois,
60670-0126, or such other office as may be designated by the Indenture Trustee
to the Owner Trustee and each holder of a Note Outstanding under the Indenture.
Indenture Trustee's Counsel shall mean The Law Department of
the First National Bank of Chicago, One First National Plaza, Suite 0120,
Chicago, Illinois, 60670-0126.
Independent Appraiser shall mean Enterprise Appraisal Co.
Independent Auditor shall mean a nationally recognized auditor
appointed in accordance with this definition. Within sixty (60) days following
Lessee's request for verification of any adjustments to Basic Rent, Stipulated
Loss Value and Termination Value, Lessee and Owner Participant shall use their
best efforts to agree on a mutually acceptable independent auditor. In the
event that the Owner Participant and the Lessee cannot agree on a auditor, the
Owner Participant shall have the right to appoint a nationally recognized
auditor (who shall not be Owner Participant's then outside auditor).
Interest Deductions shall have the meaning set forth in the
Tax Indemnity Agreement.
Interim Rent shall mean an amount equal to all accrued
interest due and payable on the Notes from the Closing Date to the Basic Lease
Commencement Date.
-10-
<PAGE> 67
Interim Term shall mean the period, if any, from, and
including, the Closing Date to, but excluding, the Basic Lease Commencement
Date, or such shorter period as may result from earlier termination of the
Lease as provided in the Lease.
Investment shall have the meaning set forth in Section 3 of
the Participation Agreement.
Investment Company Act shall mean the Investment Company Act
of 1940, as amended.
Investment Grade shall mean a rating of either BBB- or higher
in the case of Standard & Poor's or Baa3 or higher in the case of Moody's or,
if the rating system of either of such agencies changes after the date of the
Participation Agreement, the nearest equivalent to each such rating.
Investment Percentage shall mean that percentage which shall
be equal to the difference between 100% and the Loan Percentage.
Lease shall mean the Lease, dated as of September __, 1994,
substantially in the form of Exhibit B to the Participation Agreement, together
with each Lease Supplement executed after the Closing Date.
Lease Supplement shall mean a supplement to the Lease for
purposes of (i) adjusting Basic Rent, Stipulated Loss Value, and Termination
Value pursuant to Section 3(e) or Section 3(f) of the Lease, (ii) adding the
Lessor's Share in any Modification, if title thereto shall vest in the Owner
Trustee pursuant to the terms of the Lease, (iii) effecting Supplemental
Financings, Refunding of the Notes and Additional Equity Investments, or (iv)
otherwise changing or modifying the terms of the Lease, all in accordance with
and subject to the terms of the Lease.
Lease Term shall have the meaning set forth in Section 2 of
the Lease.
Lease Termination Date shall mean the last day of the Lease
Term (whether occurring by reason of the termination or the expiration of the
Lease).
Lessee shall mean Newmont Gold Company, a Delaware corporation.
Lessee Person shall mean the Lessee or any Affiliate, assignee
or successor of the Lessee or any other user or Person in possession of the
Facility.
-11-
<PAGE> 68
Lessee's Nevada Counsel shall mean Bible, Hoy, Trachok,
Wadhams & Zine, P.C., 2110 E. Flamingo Road, Suite 325, P.O. Box 93235, Las
Vegas, Nevada.
Lessor shall mean the Owner Trustee.
Lessor's Liens shall mean Liens upon the Trust Estate (other
than Permitted Liens described in clauses (a) and (c) through (e) of the
definition of such term) which result from acts of, or any failure to act by,
or as a result of claims against, Shawmut or the Lessor, attributable to
Shawmut, unrelated either to the ownership of the Undivided Interest, the
administration of the Trust Estate or the transactions contemplated by the
Transaction Documents.
Lessor's Share shall mean [75%][25%].
Lien shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind, including, without limitation, any
conditional sale or other title retention agreement, any lease in the nature
thereof or the filing of, or agreement to give, any financing statement under
the Uniform Commercial Code of any jurisdiction.
Loan shall have the meaning set forth in Section 2 of the
Participation Agreement.
Loan Percentage shall mean 75.60538%, or such other percentage
as may be adjusted prior to the Closing Date pursuant to the Transaction
Documents or as may be otherwise agreed upon by the Owner Participant and the
Lessee.
Loan Proceeds shall have the meaning set forth in Section 2 of
the Participation Agreement.
Maximum Investment Commitment shall mean Lessor's Share of
$[__] million (which amount shall include the Owner Participant's Investment
and its Additional Investment), plus Transaction Expenses.
Memorandum of Lease shall mean a document in recordable form
which sets forth the principal terms of the Lease.
Modifications shall mean alterations, modifications, additions
and improvements to the Facility (including the Undivided Interest) the cost of
which is required to be capitalized in accordance with GAAP; and such term
shall include, as appropriate, all Severable Required Modifications,
Nonseverable Required
-12-
<PAGE> 69
Modifications, Severable Optional Modifications and Nonseverable Optional
Modifications, but shall not include any original, substitute or Replacement
Component.
Net Economic Return shall mean the Owner Participant's
anticipated (a) net after-tax yield and (b) total net after- tax cash flows
(including 90% of its anticipated FASB 13 earnings during the first five years
after the Closing Date) resulting from the transactions described in and
contemplated by the Transaction Documents and determined on the basis of the
Pricing Assumptions.
Newmont shall mean Newmont Gold Company, a Delaware
corporation.
Newmont's Counsel shall mean White & Case, 1155 Avenue of the
Americas, New York, New York 10036
Newmont's General Counsel shall mean the General Counsel or an
Associate General Counsel of Newmont.
Nonseverable, when used in respect to any Modification, shall
mean any Modification which is not a Severable Modification.
Notes or Notes shall mean the Notes and any Supplemental
Financing Notes issued or to be issued by the Owner Trustee under the Indenture
and authenticated by the Indenture Trustee.
Notice of Closing shall have the meaning set forth in Section
5 of the Participation Agreement.
Officers' Certificate shall mean a certificate signed by the
President or any Vice President and by the Treasurer, any Assistant Treasurer,
the Secretary or any Assistant Secretary of the Person with respect to which
such term is used.
Optional Modifications shall have the meaning set forth in
Section 8(d) of the Lease.
Original of the Lease shall mean the fully executed
counterpart of the Lease marked "Original" pursuant to Section 21(e) of the
Lease.
Other Lease shall mean the Lease, dated as of September __,
1994, between Newmont Gold Company, as lessee and the Other Owner Trustee.
-13-
<PAGE> 70
Other Owner Trustee shall mean the owner trustee under Trust
Agreement No. 2, dated as of July 15, 1994, between the Owner Participant and
Shawmut.
Other Participation Agreement shall mean the Participation
Agreement, dated as of July 15, 1994, and among the owner participant party
thereto, the Other Owner Trustee and First Chicago, as indenture trustee and
pass through trustee and relating to Owner Trust No. 2.
Other User shall have the meaning set forth in Section 2 of
the Support Agreement.
Outstanding, when used with respect to Notes, shall mean, as
of the date of determination, all such Notes theretofore issued, authenticated
and delivered under the Indenture, except (a) Notes theretofore cancelled by
the Indenture Trustee or delivered to the Indenture Trustee for cancellation,
(b) Notes or portions thereof for the payment of which the Indenture Trustee
holds (and has notified the holders thereof that it holds) in trust for that
purpose an amount sufficient to make full payment thereof when due, (c) Notes
or portions thereof which have been pledged as collateral for any obligations
of the obligor thereof to the extent that an amount sufficient to make full
payment of such obligations when due has been deposited with the pledgee of
such Notes for the purpose of holding such amount in trust for the payment of
such obligations in accordance with the indenture or agreement under which such
obligations are secured and (d) Notes in exchange for, or in lieu of, which
other Notes have been issued, authenticated and delivered pursuant to such
Indenture.
Overdue Rate shall mean the rate per annum from time to time
equal to the greater of (x) two percent (2%) above the Average Applicable Rate
and (y) two percent (2%) above the Prime Rate computed on the basis of a
360-day year of twelve 30-day months.
Owner Participant shall mean Philip Morris Capital
Corporation, a Delaware corporation.
Owner Participant's Counsel shall mean Debevoise & Plimpton,
875 Third Avenue, New York, New York 10022.
Owner Participant's Liens shall mean Liens on the Trust Estate
arising during the Lease Term or prior to the payment in full of the Notes
(other than Permitted Liens described in clauses (a) and (c) through (e) of the
definition of such term) which result solely from acts of, or any failure to
act by, or claims against, the
-14-
<PAGE> 71
Owner Participant unrelated to the transactions contemplated by the Transaction
Documents and which are not being contested by the Owner Participant in good
faith and by appropriate proceedings, as long as such proceedings do not
involve any material danger of the sale, forfeiture or loss (or loss of use) of
the Undivided Interest, the Indenture Estate, title thereto or any interest
therein.
Owner Participant's Nevada Counsel shall mean Jeppson & Lee,
100 Liberty, Suite 990, Reno, Nevada 89501.
Owner Trustee shall mean Shawmut Bank Connecticut, National
Association, a national banking association, not in its individual capacity,
but solely as Owner Trustee under Trust Agreement [No. 1][No. 2], dated as of
July 15, 1994, and each successor as Owner Trustee under such Trust Agreement.
Owner Trustee's Counsel shall mean Shipman & Goodwin, One
American Row, Hartford, CT 06103.
Participation Agreement shall mean the Participation
Agreement, dated as of July 15, 1994 among Shawmut Bank Connecticut, National
Association, in its individual capacity and as Owner Trustee, the Indenture
Trustee, the Owner Participant, the Pass Through Trustee and Newmont.
Pass Through Certificates shall mean the pass through
certificates issued pursuant to the Pass Through Trust Agreement.
Pass Through Trust Agreement shall mean each Pass Through
Trust Agreement, dated as of July 15, 1994, between Newmont and the Pass
Through Trustee, it being understood that there shall be a Pass Through Trust
Ageement which will acquire and hold Notes of each maturity issued under an
Indenture Supplement and that if multiple maturities should be authorized and
issued all references to Pass Through Trust Agreement shall be deemed to be in
the plural.
Pass Through Trustee shall mean The First National Bank of
Chicago, a national banking association, not in its individual capacity, but
solely as Pass Through Trustee under each Pass Through Trust Agreement, and
each successor such Pass Through Trustee under the related Pass Through Trust
Agreement.
Pass Through Trustee's Counsel shall mean The Law Department
of the First National Bank of Chicago, One First National Plaza, Suite 0120,
Chicago, Illinois, 60670-0126.
-15-
<PAGE> 72
Payment Default shall mean a Default under Section 16(a)(1) or
(2) of the Lease.
Permitted Investments shall mean (i) obligations of the United
States of America, or fully guaranteed as to interest and principal by the
United States of America, maturing in not more than one year, (ii) certificates
of deposit having a final maturity of not more than 30 days after the date of
issuance thereof of any commercial bank incorporated under the laws of the
United States of America or any state thereof or the District of Columbia which
bank is a member of the Federal Reserve System and has a combined capital and
surplus of not less than $300,000,000 and (iii) commercial paper, rated P-1 by
Moody's Investors Services, Inc., or A-1 by Standard and Poor's Corporation,
having a remaining term until maturity of not more than 90 days, other than any
such obligation, certificate of deposit or commercial paper issued by Shawmut,
The First National Bank of Chicago or any institution which shall become a
successor Owner Trustee or Indenture Trustee; provided, however, that no such
investment made while there shall have occurred and be continuing an Indenture
Default or an Indenture Event of Default shall be a Permitted Investment if it
has a maturity in excess of 30 days.
Permitted Liens shall mean (a) the respective rights and
interests of the Lessee, the Owner Participant, the Lessor and the Indenture
Trustee, as provided in the Transaction Documents and the respective rights and
interests of the parties to the Other Participation Agreement under the
Transaction Documents (as defined in such Other Participation Agreement), (b)
Lessor's Liens and Owner Participant's Liens, (c) Liens for Taxes either not
yet due or being contested in good faith and by appropriate proceedings, so
long as such proceedings shall not involve any danger of the sale, forfeiture
or loss of any part of the Facility or the Facility Site, the Trust Estate, the
Indenture Estate, title thereto or any interest therein and shall not interfere
with the use or disposition of any part of the Facility or the Facility Site,
the Trust Estate, the Indenture Estate, title thereto or any interest therein,
or the payment of Rent, and the Lessee shall have provided adequate reserves
for the payment of such Taxes, (d) materialmen's, mechanics', workers',
repairmen's, employees' or other like Liens arising in the ordinary course of
business of the Lessee for amounts either not yet due or being contested in
good faith and by appropriate proceedings so long as such proceedings shall not
involve any danger of the sale, forfeiture or loss of any part of the Facility
or the Facility Site, the Trust Estate, the Indenture Estate, title thereto or
any interest therein and shall not interfere with the use or disposition of any
part of the Facility or the Facility Site, the Trust Estate, the Indenture
Estate, title thereto or interest therein, or the payment of Rent, and the
Lessee shall have provided adequate reserves for the payment of such amounts,
(e) Liens arising out of judgments or awards against the Lessee with respect to
which at the time an appeal or proceeding for review
-16-
<PAGE> 73
is being prosecuted in good faith and either which have been bonded or for the
payment of which adequate reserves shall have been provided so long as such
judgment, award or appeal shall not involve any danger of the sale, forfeiture
or loss of any part of the Facility or the Facility Site, the Trust Estate, the
Indenture Estate, title thereto or any interest therein and shall not interfere
with the use or disposition of any part of the Facility or the Facility Site,
the Indenture Estate, title thereto or any interest therein, or the payment of
Rent, (f) Scheduled Liens, and (g) Liens consented to by the Lessor in
accordance with the provisions of Section 12 of the Lease.
Permitted Uses and Purposes shall have the meaning set forth
in Section 2 of the Support Agreement.
Person shall mean any individual, partnership, corporation,
trust, unincorporated association or joint venture, a government or any
department or agency thereof, or any other entity.
Philip Morris Capital Corporation or PMCC shall mean Philip
Morris Capital Corporation, a Delaware corporation.
Plans and Specifications shall mean the technical
specifications of the Facility developed by Newmont, Bechtel Corporation and
Lurgi Chemie Metallurgie Industriebau GMBH and provided to the Consulting
Engineer.
Praxair Agreement shall mean the oxygen supply agreement
between the Newmont, as purchaser, and Praxair, Inc., as seller.
Premium Amount shall have the meaning given that term in the
Indenture.
Pricing Assumptions shall mean the pricing assumptions set
forth in Schedule 1 to the Lease; provided, however, that from and after any
adjustment pursuant to Section 3(e) or 3(f) of the Lease such term shall mean
the pricing assumptions set forth in Schedule 1 to the Lease, as modified in
connection with any such adjustment.
Prime Rate shall mean the "prime rate" or "base rate" of
Citibank, N.A. as announced from time to time.
Prospectus shall mean and include any preliminary prospectus
and the Final Prospectus.
-17-
<PAGE> 74
Prudent Mining Industry Practice shall mean, at a particular
time, those practices, methods and acts as are in accordance with standards of
prudence applicable to the gold mining industry in the western region of the
United States of America which would have been expected to accomplish the
desired result at the reasonable cost consistent with reliability and safety.
Prudent Mining Industry Practice shall not include any practice, method or act
that discriminates against the Facility or the Undivided Interest in relation
to those practices, methods or acts employed by the Lessee with respect to
mining facilities other than the Facility.
Purchase Documents shall mean the Bill of Sale, and such other
documents as Owner Participant's Counsel and Owner Trustee's Counsel shall deem
desirable to convey good and marketable title to the Undivided Interest to the
Lessor.
Purchase Price shall have the meaning set forth in Section 4
of the Participation Agreement.
Reasonable Basis shall mean a basis in law and fact that is
reasonable within the meaning of Formal Opinion 85-352 of the American Bar
Association.
Refunding or Refunding of the Notes shall mean the refunding
or reissuing of Notes pursuant to Section 14 of the Participation Agreement and
Section 2.02B of the Indenture.
Refunding Agreement shall have the meaning specified in
Section 14(a)(i) of the Participation Agreement.
Refunding Closing shall have the meaning specified in Section
14(a)(i) of the Participation Agreement.
Refunding Date shall have the meaning specified in Section
14(a)(i) of the Participation Agreement.
Refunding Notice shall mean the refunding notice given by the
Lessee pursuant to Section 14 of the Participation Agreement.
Refunding Securities shall have the meaning specified in
Section 14(a)(i) of the Participation Agreement.
Registration Statement shall mean the registration statement,
including the Prospectus, filed with the SEC under the Securities Act in
connection with the offer, issue and sale of the Pass Through Certificates.
-18-
<PAGE> 75
Regulations shall mean the income tax regulations promulgated
under the Code.
Renewal Term shall mean each period during which the Undivided
Interest may be leased as permitted by Section 13 of the Lease, or such shorter
period as may result from earlier termination as provided in the Lease.
Rent shall mean Basic Rent and Supplemental Rent, collectively.
Rent Payment Dates shall mean and include each January 5 and
July 5 of each year, commencing July 5, 1995, throughout the Basic Term and
September 28, 2015, and each March 28 and September 28 of each year throughout
each elected Renewal Term.
Replacement Component shall have the meaning set forth in
Section 8(c) of the Lease.
Required Modification shall mean any Modification required to
be made by the Lessee by Applicable Law or Government Rule.
Responsible Officer shall mean, with respect to the subject
matter of any covenant, agreement or obligation of any party contained in any
Transaction Document, the President, any Vice President, Assistant Vice
President, Treasurer, Assistant Treasurer or other officer who in the normal
performance of his operational responsibility would have knowledge of such
matter and the requirements with respect thereto.
Scheduled Liens shall mean the Liens set forth on Schedule 3
of the Participation Agreement.
SEC shall mean the Securities and Exchange Commission of the
United States of America.
Securities Act shall mean the Securities Act of 1933, as
amended.
Securities Act Rule shall mean any Rule promulgated by the SEC
under the Securities Act.
Securities Exchange Act shall mean the Securities Exchange Act
of 1934, as amended.
-19-
<PAGE> 76
Severable, when used with respect to any Modification, shall
mean any Modification which can be readily removed from the Facility without
materially damaging the Facility or materially diminishing or impairing the
value, utility, useful life or condition which the Facility would have had if
the applicable Modification had not been made.
Shawmut shall mean Shawmut Bank Connecticut, National
Association, a national banking association, in its individual capacity.
Site Interest shall mean the land on which the Facility is
located, leased by the Ground Lessor to the Ground Lessee pursuant to the
Ground Lease and Easement, and as such land is described in such Ground Lease
and Easement.
Stipulated Loss Value, as of any Rent Payment Date, shall mean
(i) during the Interim Term and the Basic Term, an amount equal to the product
obtained by multiplying Facility Cost by the percentage in Schedule 3 of
Stipulated Loss Values attached to the Lease (which Stipulated Loss Values as
originally attached to the Lease are based upon the Pricing Assumptions and are
subject to adjustment pursuant to Section 3(e) and Section 3(f) of the Lease)
and set forth opposite such Rent Payment Date and (ii) during any Renewal Term,
the amount determined by amortizing ratably the Fair Market Value of the
Undivided Interest as of the day following the last day of the Basic Term or
the last preceding Renewal Term, as the case may be, in semi-annual steps over
the remaining term of the Ground Lease and Easement, which amortized amounts
shall be set forth in a revised Schedule of Stipulated Loss Values and attached
to the Lease pursuant to a Lease Supplement prior to the last day of the Basic
Term or the last preceding Renewal Term, as the case may be; provided, however,
that, after giving effect to the payment of Basic Rent on such Rent Payment
Date and the application thereof to the payment of the regular installment of
principal of, and all accrued and unpaid interest on, the Notes then due,
Stipulated Loss Value as of any date shall be, under any circumstances and in
any event, an amount at least sufficient to pay in full the aggregate unpaid
principal amount of all Notes then Outstanding under the Indenture.
Supplemental Financing shall have the meaning set forth in
Section 8(g) of the Lease.
Supplemental Financing Notes shall mean those Notes issued in
conjunction with a Supplemental Financing.
-20-
<PAGE> 77
Supplemental Rent shall have the meaning set forth in Section
3(b) of the Lease.
Support Agreement shall mean the Support Agreement, dated the
Closing Date and substantially in the form of Exhibit G to the Participation
Agreement.
Tangible Net Worth shall mean with respect to a Person the
excess of tangible assets over liabilities of such Person as shown on its
balance sheet as of the end of its most recent fiscal period for which a
balance sheet is available or as of such other date as the context may require
and determined on the basis of GAAP.
Tax shall mean any and all present or future fees (including,
without limitation, documentation, recording, license and registration fees),
taxes (including, without limitation, income, gross or net income, gross
receipts, sales, use, rental, occupancy, ad valorem, value added, franchise,
business, transfer, capital, property (personal and real, tangible and
intangible), intangibles, excise and stamp taxes), levies, imposts, duties,
charges, assessments or withholdings of any nature whatsoever, general or
special, ordinary or extraordinary, together with any and all penalties, fines,
additions to tax and interest thereon.
Tax Counsel shall have the meaning set forth in the Tax
Indemnity Agreement.
Tax Indemnity Agreement shall mean the Tax Indemnity Agreement
dated the Closing Date.
Tax Law Change shall mean any change in the Code that is
enacted or proposed by the Executive Branch, the House Ways and Means
Committee, the Senate Finance Committee or the Chairman of either the House
Ways and Means Committee or the Senate Finance Committee or any change in the
Income Tax Regulations which is promulgated or proposed and effective, on or
before the Closing Date, which change affects the Pricing Assumptions.
Tax Loss shall have the meaning set forth in the Tax Indemnity
Agreement.
Tax Representations shall mean those tax representations made
by the Lessee in the Tax Indemnity Agreement.
-21-
<PAGE> 78
Termination Date shall mean the date on which the Lessee
terminates the Lease, provided such date follows the eighth anniversary of the
Basic Lease Commencement Date and corresponds to a date on which a Basic Rent
Payment is due.
Termination Value shall mean that value set forth opposite the
Termination Date in Schedule 5 to the Lease.
Transaction Documents shall mean the Participation Agreement,
the Lease, the Tax Indemnity Agreement, the Trust Agreement, the Indenture, the
Deed of Trust, the Notes, the Pass Through Trust Agreement, the Pass Through
Certificates, the Underwriting Agreement, the Ground Lease and Easement, the
Support Agreement, the Assignment of Contracts, and the Purchase Documents.
Transaction Expenses shall mean and include the sum of:
(i) the reasonable fees of Pass Through Trustee's
Counsel, Owner Trustee's Counsel, Indenture Trustee's Counsel,
Lessee's Counsel, Lessee's Nevada Counsel, Underwriter's Counsel,
Owner Participant's Counsel and Owner Participant's Nevada Counsel for
their respective services rendered in connection with the execution
and delivery of the Transaction Documents and all expenses and
disbursements incurred by each such Person through the Closing Date in
connection with such transactions;
(ii) the reasonable initial fees of the Owner Trustee and
the Indenture Trustee, and out-of-pocket expenses of each such Person
through the Closing Date in connection with the transactions;
(iii) an amount equal to the product of (A) the aggregate
of all costs of issue of the Pass Through Certificates, including the
costs of preparing the Transaction Documents, filing fees relating to
the Registration Statement, the reasonable initial fees of the Pass
Through Trustee and its out-of-pocket expenses through the Closing
Date, rating agency fees, and the discounts and commissions of the
Underwriters, multiplied by (B) the Lessor's Share;
(iv) all stenographic, printing and reproduction costs and
expenses incurred in connection with the execution and delivery of the
Participation Agreement and the other Transaction Documents and all
other agreements, documents or instruments prepared in connection
therewith;
-22-
<PAGE> 79
(v) the fees and expenses of Enterprise Appraisal Co. for
its services in preparing its letter of appraisal and engineering
report in connection with the Participation Agreement;
(vi) the out-of-pocket expenses of the Owner Participant
through the Closing Date in connection with the transaction
contemplated by the Transaction Documents;
(vii) the fees and expenses of JBR Environmental
Consultants, Inc. for its services in advising the Owner Participant
and preparing the environmental report contemplated by Section
11(a)(xxxiv) of the Participation Agreement; and
(viii) the fees and expenses of the Consulting Engineer for
its services in advising the Owner Participant and delivering the
completion letter contemplated by Section 11(a)(xxxi) of the
Participation Agreement.
Transfer shall mean the transfer, by bill of sale or
otherwise, by the Lessor to the Lessee of all the Lessor's right, title and
interest in and to the Undivided Interest on an "as is, where is" basis, free
and clear of all Lessor's Liens but otherwise without recourse, representation
or warranty, express or implied, including an express disclaimer of
representations and warranties in a manner comparable to that set forth in
Section 6(b) of the Lease, together with the due assumption by the Lessee of,
and the due release of the Lessor from, all the Lessor's obligations and
liabilities under the Transaction Documents by instrument or instruments
satisfactory in form and substance to the Lessor, and Transferred shall be
construed accordingly.
Transferee shall have the meaning set forth in Section 17 of
the Participation Agreement.
Trust shall mean the trust created by the Trust Agreement.
Trust Agreement shall mean the Trust Agreement [No. 1][No.2],
dated as of July 15, 1994, in the form of Exhibit A to the Participation
Agreement, as such Agreement shall be amended from time to time in accordance
with the terms thereof and of the Transaction Documents.
Trust Estate shall have the meaning set forth in Section 2(b)
of the Trust Agreement.
-23-
<PAGE> 80
Trustee's Expenses shall mean any and all liabilities,
obligations, costs, compensation, fees, expenses and disbursements (including,
without limitation, legal fees and expenses) of any kind and nature whatsoever
(other than such amounts as are included in Transaction Costs) which may be
imposed on, incurred by or asserted against the Indenture Trustee or any of its
agents, servants or personal representatives, in any way relating to or arising
out of the Indenture, the Indenture Estate, the Participation Agreement or the
Lease, or any document contemplated thereby, or the performance or enforcement
of any of the terms thereof, or in any way relating to or arising out of the
administration of such Indenture Estate or the action or inaction of the
Indenture Trustee under the Indenture; provided, however, that such amounts
shall not include any Taxes or any amount expressly excluded from the Lessee's
indemnity obligations pursuant to Section 13(b)(ii) of the Participation
Agreement.
UCC or Uniform Commercial Code shall mean the Uniform
Commercial Code as in effect in the States of Nevada and Colorado,
respectively.
Underwriters shall mean Salomon Brothers Inc, Chemical
Securities Inc., CS First Boston Corporation and Lazard Freres & Co.
Underwriters' Counsel shall mean Davis Polk & Wardwell, 450
Lexington Avenue, New York, NY 10017.
Underwriting Agreement shall mean the agreement between
Newmont and the Underwriters relating to the offering and sale of the Pass
Through Certificates.
Undivided Interest shall mean a [75%][25%] undivided interest
in the Facility.
U.S. Financial Obligations shall mean an instrument or
instruments evidencing indebtedness for borrowed money of Newmont denominated
in U.S. dollars in an amount in excess of $40 million.
U.S. Properties shall mean the real property and tangible
assets of Newmont physically located in the United States.
User shall have the meaning set forth in Section 2 of the
Support Agreement.
Weighted Average Life to Maturity shall have the meaning set
forth in Section 1.01 of the Indenture.
-24-
<PAGE> 1
EXHIBIT 4.4
EXHIBIT B
TO
PARTICIPATION AGREEMENT
CERTAIN RIGHTS OF THE LESSOR UNDER THIS LEASE AND IN THE UNDIVIDED INTEREST
HAVE BEEN ASSIGNED TO, AND ARE SUBJECT TO A SECURITY INTEREST IN FAVOR OF, THE
FIRST NATIONAL BANK OF CHICAGO, AS INDENTURE TRUSTEE. THIS LEASE HAS BEEN
EXECUTED IN SEVERAL COUNTERPARTS. SEE SECTION 21(e) FOR INFORMATION CONCERNING
THE RIGHTS OF HOLDERS OF VARIOUS COUNTERPARTS HEREOF.
============================================================
LEASE
dated as of
September --, 1994
between
SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity, but solely as Owner Trustee
under Trust Agreement [No. 1][No. 2],
dated as of July 15, 1994,
with Philip Morris Capital Corporation,
as Lessor
and
NEWMONT GOLD COMPANY,
as Lessee
============================================================
NEWMONT GOLD ORE TREATMENT FACILITY
Trust [No. 1][No. 2]
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Section Title Page
- ------- ----- ----
<S> <C> <C>
SECTION 1. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 2. Lease of Undivided Interest; Sublease of
Site Interest; and Lease Term. . . . . . . . . . . . . . . . . . . . . 2
SECTION 3. Rent; Adjustments to Rent; and Ground Lease Rent . . . . . . . . . . . . . . . . 2
(a) Basic Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
(b) Supplemental Rent . . . . . . . . . . . . . . . . . . . . . . . . . 3
(c) Failure to Pay Supplemental Rent . . . . . . . . . . . . . . . . . 4
(d) Form of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(e) Adjustments for Changes in Pricing Assumptions . . . . . . . . . . 5
(f) Further Adjustments . . . . . . . . . . . . . . . . . . . . . . . . 5
(g) Adequacy of Payments . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 4. Net Lease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 5. Return of the Undivided Interest . . . . . . . . . . . . . . . . . . . . . . . . 7
(a) Return of the Undivided Interest . . . . . . . . . . . . . . . . . 7
(b) Disposition Services . . . . . . . . . . . . . . . . . . . . . . . 8
(c) Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 6. Warranty of the Lessor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(a) Quiet Enjoyment . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(b) Disclaimer of Other Warranties . . . . . . . . . . . . . . . . . . 9
SECTION 7. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 8. Operation and Maintenance; Marking; Inspection . . . . . . . . . . . . . . . . . 10
(a) Operation and Maintenance . . . . . . . . . . . . . . . . . . . . . 10
(b) Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
</TABLE>
(i)
<PAGE> 3
<TABLE>
<CAPTION>
Section Title Page
- ------- ----- ----
<S> <C> <C>
(c) Replacement of Components . . . . . . . . . . . . . . . . . . . . . 11
(d) Modifications . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(e) Reports of Modifications . . . . . . . . . . . . . . . . . . . . . 12
(f) Title to Modifications . . . . . . . . . . . . . . . . . . . . . . 12
(g) Funding of Modifications . . . . . . . . . . . . . . . . . . . . . 13
(h) Failure to Finance; Purchase Rights . . . . . . . . . . . . . . . . 14
(i) Marking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
(j) Environmental Compliance . . . . . . . . . . . . . . . . . . . . . 15
(k) Contest of Requirements of Law . . . . . . . . . . . . . . . . . . 16
SECTION 9. Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
(a) Event of Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(b) Consequences of an Event of Loss . . . . . . . . . . . . . . . . . 17
(c) Damage Not Constituting an Event
of Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(d) Excess Loss Proceeds . . . . . . . . . . . . . . . . . . . . . . . 18
(e) Application of Payments Not Relating
to an Event of Loss . . . . . . . . . . . . . . . . . . . . . . . 18
(f) Other Dispositions . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 10. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 11. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 12. Assignment or Sublease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 13. Lease Renewals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(a) Lease Renewal . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(b) Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(c) Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
(d) Determinations . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 14. Purchase Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 15. Early Termination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 16. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
</TABLE>
(ii)
<PAGE> 4
<TABLE>
<CAPTION>
Section Title Page
- ------- ----- ----
<S> <C> <C>
SECTION 17. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
(a) Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
(b) No Release . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
(c) Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . 32
(d) Exercise of Other Rights or Remedies . . . . . . . . . . . . . . . 32
SECTION 18. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 19. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 20. Right to Perform for Lessee . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 21. Amendments and Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . 34
(a) Amendments in Writing . . . . . . . . . . . . . . . . . . . . . . . 34
(b) Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
(c) Severability of Provisions . . . . . . . . . . . . . . . . . . . . 34
(d) True Lease . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
(e) Original Lease . . . . . . . . . . . . . . . . . . . . . . . . . . 35
(f) Other Lease . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
(g) Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
(h) Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
(i) Counterpart Execution . . . . . . . . . . . . . . . . . . . . . . . 35
SCHEDULES
SCHEDULE 1 Pricing Assumptions
SCHEDULE 2 Basic Rent Payments
SCHEDULE 3 Stipulated Loss Values
SCHEDULE 4 Early Buy-Out Price
SCHEDULE 5 Termination Values
SCHEDULE 6 Description of the Facility
EXHIBIT
EXHIBIT A Certificate of Acceptance
</TABLE>
(iii)
<PAGE> 5
LEASE
THIS LEASE, dated as of September __, 1994, between SHAWMUT
BANK CONNECTICUT, NATIONAL ASSOCIATION, not in its individual capacity, but
solely as Owner Trustee under Trust Agreement [No. 1][No. 2], dated as of
July 15, 1994 (Trust Agreement [No. 1][No. 2]), with Philip Morris Capital
Corporation (the Owner Participant), as Lessor (the Lessor), and NEWMONT GOLD
COMPANY, a Delaware corporation, as lessee (the Lessee).
W I T N E S S E T H :
WHEREAS, the Lessee desires to lease the Undivided Interest
from the Lessor and to sublease the Site Interest from the Ground Lease Lessee;
and
WHEREAS, (i) the Lessor is willing to lease the Undivided
Interest, and (ii) the Ground Lease Lessee is willing to sublease the Site
Interest, in each case to the Lessee and on the terms and conditions set forth
herein.
NOW, THEREFORE, in consideration of the premises and of other
good and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto agree as follows:
SECTION 1. DEFINITIONS.
For purposes hereof, capitalized terms used herein shall have
the meanings set forth in Appendix A to the Participation Agreement, dated as
of July 15, 1994, among the Owner Participant, the Owner Trustee, individually
and as Owner Trustee under Trust Agreement [No. 1][No. 2], the Indenture
Trustee, individually and as Indenture Trustee under an Indenture, dated as of
July 15, 1994, with the Owner Trustee, the Pass Through Trustee, individually
and as Pass Through Trustee under the Pass Through Trust Agreement, and the
Lessee. References herein to sections, paragraphs and clauses are to sections,
paragraphs and clauses in this Lease unless otherwise indicated.
<PAGE> 6
SECTION 2. LEASE OF UNDIVIDED INTEREST; SUBLEASE OF SITE
INTEREST; AND LEASE TERM.
(a) Lease of Undivided Interest, etc. Upon and subject
to the terms and conditions of this Lease, (i) the Lessor agrees to lease to
the Lessee, and the Lessee hereby agrees to lease from the Lessor, the
Undivided Interest and (ii) the Ground Lease Lessee agrees to sublease to the
Lessee, and the Lessee hereby agrees to sublease from the Ground Lease Lessee,
the Site Interest. The term of this Lease (the Lease Term) shall begin on the
Closing Date and shall end on September 28, 2015, or such earlier or later date
on which, or to which, this Lease shall have been terminated, extended or
renewed, or the Lessee shall have exercised its Early Purchase Option, all
pursuant to the terms hereof. During the Lease Term, the Lessee agrees to
perform all terms and conditions of the Ground Lease Lessee under the Ground
Lease and Easement.
(b) Character of the Facility. It is the express
intention of the Lessor and the Lessee that the Facility and the Undivided
Interest shall at all times be and remain personal property as to all persons
and for all purposes to the fullest extent permitted by Applicable Law. In the
event that, notwithstanding the foregoing, a court of competent jurisdiction
shall make a final determination that some part or portion of the Undivided
Interest constitutes real property under Applicable Law, then this Lease shall
be deemed to be and shall be construed as a divisible and severable contract
between the Lessor and the Lessee for the leasing of respectively (i) the part
or portion of the Undivided Interest so determined to constitute real property
under Applicable Law, and (ii) the remainder of the Undivided Interest, all to
the same extent and with the same force and effect as though a separate lease
had been entered into by the Lessor and the Lessee in respect of the part or
portion of the Undivided Interest so determined to constitute real property and
the remainder of the Undivided Interest and the amount of each installment of
Basic Rent payable in respect of the part or portion of the Facility so
determined to constitute real property shall bear the same relationship to the
aggregate amount of such installment of Basic Rent as the cost to the Lessor of
such part or portion of the Undivided Interest so determined to constitute real
property shall bear to Facility Cost.
SECTION 3. RENT; ADJUSTMENTS TO RENT; AND GROUND LEASE RENT.
(a) BASIC RENT. The Lessee shall pay to the Lessor as
basic rent (Basic Rent) for the Undivided Interest, the following amounts:
-2-
<PAGE> 7
(1) on the Basic Lease Commencement Date, an amount with
respect to the Interim Term, equal to all Interim Rent.
(2) on each Rent Payment Date during the Basic Lease
Term, an amount, determined initially on the basis of the Pricing
Assumptions, but subject to adjustments pursuant to this Section 3 and
subject to Section 3(g), equal to the product obtained by multiplying
Facility Cost by the percentage set forth opposite the number of such
Rent Payment Date in Schedule 2 hereto (as such Schedule may be
amended from time to time pursuant to a Lease Supplement) with respect
to the respective periods indicated on such schedule.
(3) on each Rent Payment Date during any Fixed Rate
Renewal Term, an amount equal to 50% of the average of all
installments of Basic Rent during the Basic Lease Term.
(4) on each Rent Payment Date during any Fair Market
Renewal Term, an amount equal to the Fair Market Rental Value of the
Undivided Interest established for such Fair Market Renewal Term
pursuant hereto.
Clause (2) above to the contrary notwithstanding, if the Lessee shall pay any
amount pursuant to clause (1) above, it shall thereafter have the right to
reduce the amount of Basic Rent payable pursuant to clause (2) by an amount
equal to the excess, if any, of (i) the amount of Basic Rent payable on any
Rent Payment Date over (ii) the amount of principal and interest due and
payable on such Date with respect to the Notes, and such right shall continue
until such time as the Lessee shall have recovered, by set- off, the full
amount paid under such clause (1), together with interest on the outstanding
balance thereof at a rate equal to the Overdue Rate for the period from the
Basic Lease Commencement Date to the Rent Payment Date on which the foregoing
amount shall have been recovered in full.
(b) SUPPLEMENTAL RENT. The Lessee shall pay the
following amounts as supplemental rent (Supplemental Rent):
(1) on demand, any amount (other than Basic Rent,
Stipulated Loss Value, Termination Value and the Early Buy- Out Price)
which the Lessee is required to pay, or agrees to pay, under this
Lease or any other Transaction Document.
-3-
<PAGE> 8
(2) on the date provided herein, any amount payable
hereunder as Stipulated Loss Value, Termination Value, Early Buy-Out
Price or Fair Market Value.
(3) on demand and in any event on the next succeeding
Rent Payment Date, to the extent permitted by Applicable Law, interest
at a rate equal to the Overdue Rate on any payment of Basic Rent or
Supplemental Rent not paid when due (whether or not the Lessee's
payment obligation is subject to any period of grace) for any period
for which the same shall be overdue.
(4) on any Refunding Date, an amount equal to premium, if
any, and, if such Refunding Date shall occur on any date other than a
Rent Payment Date, accrued and unpaid interest, on the Notes so
refunded which shall be payable on the date of such Refunding in
accordance with the terms of such Notes and the Indenture.
(5) on any date of prepayment of the Notes (other than
pursuant to a Refunding), an amount equal to the premium, if any,
required to be paid with respect to the Notes being prepaid on such
date.
(6) on the dates provided for in the Ground Lease and
Easement, an amount equal to the Ground Lease Rent due under the
Ground Lease and Easement.
(c) FAILURE TO PAY SUPPLEMENTAL RENT. If the Lessee
shall fail to pay Supplemental Rent when the same shall be due and payable, the
Lessor shall have all rights, powers and remedies provided for herein, at law
or in equity, in respect of the nonpayment of Basic Rent.
(d) FORM OF PAYMENT. All payments of Rent shall be made
in immediately available funds on the date each such payment shall be due
hereunder and shall be paid to either (i) in the case of payments other than
Excepted Payments or Ground Lease Rent, the Indenture Trustee so long as the
Notes shall be outstanding, and thereafter as the Lessor may direct by notice
in writing to the Lessee, or (ii) in the case of Excepted Payments and Ground
Lease Rent, the Person entitled to receive such payments under the terms hereof
or of any other Transaction Document at such address as such Person may direct
by notice in writing to the Lessee. The Lessee shall cause each transfer of
funds to be initiated by such time as shall permit oral confirmation of such
transfer to be given no later than 11:00 a.m., New York City time, on the
applicable payment
-4-
<PAGE> 9
date. If the date on which any payment of Rent is due shall not be a Business
Day, such payment shall be payable on the next succeeding Business Day,
together with interest thereon at the Overdue Rate for the period from, and
including, the due date to, but excluding, such next succeeding Business Day.
(e) ADJUSTMENTS FOR CHANGES IN PRICING ASSUMPTIONS.
Basic Rent, Stipulated Loss Value and Termination Value shall be subject to
adjustment, upward or downward, to preserve Net Economic Return in consequence
of, (i) any Tax Law Change, (ii) any change in the actual interest rate on, the
schedule for the amortization of, and any other material term of, the Notes, if
different from that assumed in the Pricing Assumptions, (iii) a Closing Date
which shall occur on any date other than September 28, 1994, provided, however,
that no such change in the Closing Date shall result in any adjustment with
respect to any issues arising under section 168(d)(3) of the Code, (iv)
Transaction Expenses being greater than 1% of Facility Cost and (v) changes
from the Depreciation Deductions set forth in the Pricing Assumptions.
Adjustments, if any, pursuant to clauses (i) through (v) above shall be made
on, and be effective as of, the Closing Date. Prior to the Closing Date, the
Lessor, based upon information provided by the Owner Participant, shall provide
to the Lessee, upon reasonable request and reasonable advance notice,
alternative adjustments to Basic Rent, Stipulated Loss Value and Termination
Value to reflect the final adjustment to the Pricing Assumptions both with and
without concurrent adjustment to the Early Buy-Out Price. In each such case,
the Lessee, in its sole discretion, may choose to effect either of such
alternative adjustments by giving prompt written notice to such effect to the
Lessor and the Owner Participant.
(f) FURTHER ADJUSTMENTS. Basic Rent, Stipulated Loss
Value, Termination Value and the Early Buy-Out Price (in each case, after
giving effect to any prior adjustments pursuant to Section 3) shall be subject
to further adjustment, upward or downward, to reflect, and to preserve Net
Economic Return in consequence of, any Additional Equity Investment, any
Supplemental Financing and any Refunding of the Notes, which adjustment shall
be made on or before the Rent Payment Date next following the date of such
investment, financing or Refunding, as the case may be, and shall be effective
with respect to such Basic Rent Payment and all payments of Basic Rent,
Stipulated Loss Value, Termination Value and the Early Buy-Out Price payable
thereafter. If, in connection with any Refunding of the Notes, the Lessee
shall have paid, as Supplemental Rent, an amount equal to accrued and unpaid
interest on the Notes being refunded on a Refunding Date which is not a Rent
Payment Date, Basic Rent payable on the Rent Payment Date next succeeding such
Refunding Date (if
-5-
<PAGE> 10
not yet adjusted to reflect such Refunding pursuant to this Section 3(f)) shall
be reduced by the amount of such Supplemental Rent payment.
(g) ADEQUACY OF PAYMENTS. Each installment of Basic Rent
payable on each Rent Payment Date shall be, under any circumstances and in any
event, at least sufficient to pay on such Rent Payment Date, and any payment of
Stipulated Loss Value, Termination Value or the Early Buy-Out Price payable on
any date on which the payment of any such value shall be required or permitted
hereunder shall be, under any circumstances and in any event, at least
sufficient to pay on such date, all principal of, premium, if any, and interest
on, all Notes then due and payable. The amount of each adjustment to Basic
Rent, Stipulated Loss Value, Termination Value and, if and when required, the
Early Buy-Out Price shall first be determined by the Owner Participant, but
shall be subject to verification, at the Lessee's expense, by an Independent
Auditor if the Lessee shall so request. Subject only to such verification,
such adjustment shall be conclusive and binding on the Lessee if the Owner
Participant confirms to the Lessee in writing that such adjustment was computed
on a basis consistent with the original computation of Basic Rent, Stipulated
Loss Value, Termination Value and Early Buy-Out Price. Each adjustment
pursuant to this Section 3 shall be evidenced by the execution and delivery of
a Lease Supplement, but shall be effective on and as of the date provided
herein without regard to the date on which such Lease Supplement is actually
executed and delivered.
SECTION 4. NET LEASE.
This Lease shall be a net lease and the Lessee hereby
acknowledges and agrees that the Lessee's obligation to pay all Rent hereunder,
and the rights of the Lessor in and to such Rent, shall be absolute and
unconditional and shall not be affected by any event, circumstance or reason
whatsoever, including (i) any set-off, abatement, counterclaim, suspension,
recoupment, reduction, defense or other right which the Lessee may have against
the Lessor, the Owner Participant, the Indenture Trustee, any vendor or
manufacturer with respect to the Facility or any Component incorporated
therein, or any other Person, (ii) any defect in the design or condition of the
Facility, the Facility Site, any Component incorporated therein or the
Undivided Interest, the merchantability thereof, the fitness thereof for any
particular purpose, title to the Facility, the Facility Site, any Component
incorporated therein or the Undivided Interest, the quality of the material or
the workmanship thereof, the conformity thereof to the Plans and
Specifications, or the absence of any latent or other defects, whether or not
discoverable, (iii) any loss, theft or destruction of the Facility, or any
-6-
<PAGE> 11
interference, interruption or cessation, of whatever duration, in the use or
possession thereof, of any Component incorporated therein, or of the Undivided
Interest by the Lessee or any Person, (iv) any restriction, prevention or
curtailment of or interference with any use of the Facility, the Facility Site
or of the Undivided Interest, (v) any insolvency, bankruptcy, reorganization or
similar proceeding by or against the Lessee, the Lessor, the Owner Participant
or any other Person, (vi) the invalidity, illegality or unenforceability of any
Transaction Document (including this Lease), any other infirmity herein or
therein, or any lack of right, power or authority of the Lessee, the Lessor,
the Owner Participant, the Indenture Trustee or any other Person to enter into
this Lease or any other Transaction Document, (vii) the breach or failure of
any warranty or representation made in any Transaction Document by the Lessor,
the Owner Participant, the Indenture Trustee or any other Person, (viii) any
amendment or other change of, or any assignment of rights under, this Lease or
any other Transaction Document, or any waiver or any other action or inaction
under or in respect of this Lease or any other Transaction Document, or any
exercise or nonexercise of any right or remedy under this Lease or any other
Transaction Document, including the exercise of any foreclosure or other remedy
under the Indenture or this Lease, or the sale of the Facility, the Facility
Site, any Component incorporated therein or the Undivided Interest, or (ix) any
other circumstance or happening whatsoever, whether or not similar to any of
the foregoing. The Lessee hereby waives, to the extent permitted by Applicable
Law, any and all rights which it may now have or which at any time hereafter
may be conferred upon it, by statute or otherwise, to terminate, cancel, quit
or surrender this Lease except in accordance with the express terms hereof. If
for any reason whatsoever this Lease shall be terminated in whole or in part by
operation of law or otherwise, except as specifically provided herein, the
Lessee nonetheless agrees to pay to the Lessor an amount equal to each
installment of Basic Rent and all Supplemental Rent at the time such payment
would have become due and payable in accordance with the terms hereof had this
Lease not been terminated in whole or in part. Each payment of Rent made by
the Lessee shall be final and, except as provided in Section 3(a) hereof, the
Lessee shall not seek to recover all or any part of such payment from the
Lessor or any other Person for any reason whatsoever.
SECTION 5. RETURN OF THE UNDIVIDED INTEREST.
(a) RETURN OF THE UNDIVIDED INTEREST. Upon the
expiration of the Lease Term or the termination of this Lease pursuant to the
terms hereof, the Lessee shall surrender possession of the Undivided Interest
to the Lessor, subject
-7-
<PAGE> 12
to the terms and provisions of the Ground Lease and Easement and the Facility
Agreements. At the time of such return the Undivided Interest shall be free
and clear of all Liens (other than Lessor's Liens, Owner Participant's Liens
and the Lien of the Ground Lease and Easement and the Facility Agreements) and
the Facility shall be in the condition and repair required by Section 8 and
shall be capable of operating in compliance with all Applicable Laws and
Governmental Actions relating to the Facility. At the time of the return of
the Undivided Interest, the Lessee will, at the Lessor's option, either remove
all Severable Modifications title to which is in the Lessee, or sell or lease
such Modifications to the Lessor for a price or at a rental equal to the Fair
Market Value or Fair Market Rental Value thereof. At the time of such return,
the Lessee shall provide the Lessor with spares and other supplies used in the
operation of the Facility in amounts sufficient to enable to the User to
operate the Facility consistent with Prudent Mining Industry Practice and all
Applicable Laws.
(b) DISPOSITION SERVICES. The Lessee agrees that if it
does not exercise its option hereunder to renew this Lease or to purchase the
Undivided Interest, then during the last eighteen months of the Basic Term or
the applicable Renewal Term, as the case may be, the Lessee will fully
cooperate with the Lessor in connection with the Lessor's efforts to dispose
of, and, in addition, at the request of the Lessor, the Lessee will make a
reasonable effort to dispose of, the Undivided Interest and the Lessor's
interest under the Ground Lease and Easement and the Facility Agreements. The
Lessor agrees to reimburse the Lessee for its reasonable out-of-pocket costs
and expenses incurred in connection with such efforts, whether or not the
Lessor disposes of the Undivided Interest.
(c) INSPECTION. During the last year of the Lease Term,
(i) the Lessor may retain an independent consultant at the Lessee's expense to
inspect the Facility for purposes of confirming that the return conditions set
forth in this Section 5 will be complied with upon redelivery to the Lessor at
the end of the Lease Term, and (ii) with reasonable notice and during normal
business hours, the Lessee will cooperate in all reasonable respects with the
efforts of the Lessor, or such independent consultant, to inspect the Facility
and any records relating to the Facility then in the possession of the Lessee
or any Affiliate thereof in order to confirm compliance with the return
conditions set forth in clause (a) of this Section 5; provided that any such
cooperation shall not interfere with the normal operation of the Facility by
the Lessee.
-8-
<PAGE> 13
SECTION 6. WARRANTY OF THE LESSOR.
(a) QUIET ENJOYMENT. The Lessor warrants that during the
Lease Term, so long as no Event of Default or Bankruptcy Default shall have
occurred and be continuing, it will not take any action in violation of, or to
disturb, the Lessee's quiet enjoyment, possession and use of the Facility,
including the Undivided Interest, in accordance with the terms hereof and of
the other Transaction Documents.
(b) DISCLAIMER OF OTHER WARRANTIES. The warranty set
forth in paragraph (a) above is in lieu of all other warranties of the Lessor,
whether written or oral or express or implied, with respect to this Lease, the
Facility, any Component incorporated therein or the Undivided Interest. As
between the Lessor and the Lessee, execution by the Lessee of the Certificate
of Acceptance shall be conclusive proof of the compliance of the Facility and
the Undivided Interest with all requirements of this Lease, and THE LESSOR
LEASES AND THE LESSEE TAKES THE UNDIVIDED INTEREST AS IS AND WHERE IS, and the
Lessor shall not be deemed to have made, and THE LESSOR HEREBY DISCLAIMS, ANY
OTHER REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED, AS TO ANY MATTER
WHATSOEVER, INCLUDING THE DESIGN OR CONDITION OF THE FACILITY, ANY COMPONENT
INCORPORATED THEREIN OR THE UNDLVLDED INTEREST, THE MERCHANTABILITY THEREOF OR
THE FITNESS THEREOF FOR ANY PARTICULAR PURPOSE, TITLE TO THE FACILITY, ANY
COMPONENT INCORPORATED THEREIN OR THE UNDIVIDED INTEREST, THE QUALITY OF THE
MATERIAL OR WORKMANSHIP THEREOF OR THE CONFORMITY THEREOF TO THE PLANS AND
SPECIFICATIONS, OR THE ABSENCE OF ANY LATENT OR OTHER DEFECTS, WHETHER OR NOT
DISCOVERABLE, NOR SHALL THE LESSOR BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL
DAMAGES (INCLUDING LIABILITY IN TORT, STRICT OR OTHERWISE), it being agreed
that all such risks, as between the Lessor and the Lessee, are to be borne by
the Lessee.
SECTION 7. LIENS.
Excepting only Permitted Liens, the Lessee will not directly
or indirectly create, incur, assume or suffer to exist any Liens on or with
respect to the Site Interest or the Facility or any Component incorporated
therein or the Undivided Interest, or the Lessor's title thereto or any
interest of the Lessor
-9-
<PAGE> 14
therein. The Lessee will promptly, at its own expense, take such action as may
be necessary duly to discharge any Lien other than Permitted Liens.
SECTION 8. OPERATION AND MAINTENANCE; MARKING; INSPECTION.
(a) OPERATION AND MAINTENANCE. The Lessee covenants that
it will (i) operate, service, repair and maintain the Facility and the Site
Interest so that the condition and operating efficiency thereof will be
maintained and preserved, ordinary wear and tear excepted, in a manner
consistent with (x) Prudent Mining Industry Practice, (y) such operating
standards as shall be required to enforce warranty claims against the
Contractor and all vendors, manufacturers and subcontractors, and (z) the terms
and conditions of all insurance policies in effect with respect to the
Facility, Site Interest, or the Undivided Interest, (ii) comply with Applicable
Law affecting the Facility, the Facility Site, or the Undivided Interest and
the use, operation and maintenance thereof (including, the disposal of wastes
and other by-products of the Facility) unless the validity or applicability of
any such Law is being contested as permitted by Section 8(k), and (iii) keep
and maintain proper books and records relating to all services rendered and all
funds expended for operation and maintenance of the Facility and the Facility
Site and the acquisition, construction and installation of all Replacement
Components and Modifications, all in accordance with GAAP and Prudent Mining
Industry Practice. The Lessor shall not be obliged to maintain, alter, repair,
rebuild or replace any Component incorporated in the Facility. The Lessee
further covenants that other assets or facilities of Newmont located in the
Carlin Complex, the use and operation of which have or may have a material
impact on the Facility, shall be maintained by Newmont consistent with Prudent
Mining Industry Practice.
(b) INSPECTION. Subject to Section 8(j) hereof, any of
the Lessor, the Owner Participant or the Indenture Trustee shall have the
right, but not the duty, to inspect the Facility and the Site Interest at its
expense. Upon the request of any such Person, the Lessee shall, upon
reasonable notice and during ordinary business hours, make the Facility and the
Site Interest, and the Lessee's operating, maintenance and repair records
pertaining to the Facility and the Site Interest, available to such Person for
inspection. Notwithstanding the first sentence of this clause, if the Lessor,
the Owner Participant or the Indenture Trustee has given the Lessee notice
that it desires to inspect the Facility or the Site Interest in connection with
a Default, then the reasonable expenses of such inspection shall be for the
account of the Lessee.
-10-
<PAGE> 15
(c) REPLACEMENT OF COMPONENTS. If and to the extent
required by paragraph (a) above and in compliance with the Lessee's covenant
thereunder, unless prohibited by Applicable Law, the Lessee, at its sole
expense, will promptly replace each Component, the replacement of which shall
be required in accordance with Prudent Mining Industry Practice or Applicable
Law (each such Component so replaced being herein referred to as a Replacement
Component), which may from time to time fail to function in accordance with its
intended use, or become worn out, destroyed, damaged beyond repair, lost,
condemned, confiscated, stolen or seized for any reason whatsoever. In
addition, in the ordinary course of maintenance, service, repair or testing,
the Lessee may remove any Component incorporated in the Facility; PROVIDED that
the Lessee shall cause such Component to be replaced by a Replacement Component
as promptly as practicable and, upon replacement of such Component in
accordance with this paragraph (c), the Lessee shall be entitled to retain the
entire amount of the net proceeds (including the Undivided Interest in such net
proceeds) of any sale or disposition of such removed Component. Each
Replacement Component 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 Component replaced, assuming such replaced
Component was in the condition and repair required under paragraph (a) above.
The Undivided Interest in each Component removed from the Facility shall remain
the property of the Lessor, no matter where located, until such time as such
Component shall be replaced by a Replacement Component. Immediately upon the
incorporation of any Replacement Component, without further act, (i) title to
an Undivided Interest in the removed Component shall thereupon vest in the
Lessee or its designee, free and clear of all rights of the Lessor, the Owner
Participant or the Indenture Trustee, (ii) title to an undivided interest in
such Replacement Component, the percentage of which shall be equal to the
Lessor's Share, shall thereupon vest in the Lessor and (iii) such undivided
interest in such Replacement Component shall become subject to this Lease and
be deemed part of the Undivided Interest and the Facility for all purposes
hereof to the same extent that the Lessor had an Undivided Interest in the
Component originally incorporated in the Facility.
(d) MODIFICATIONS. The Lessee shall make all Required
Modifications in accordance with Prudent Mining Industry Practice and
Applicable Law. The Lessee may make any Severable Modification and any
Nonseverable Modification (other than a Required Modification) when, and under
the circumstances under which, the Lessee, in its sole discretion, shall deem
any such Modification appropriate (each such Modification being herein referred
to as an Optional Modification). All Required and Optional Modifications, once
initiated, shall be completed in a good and workmanlike manner, with reasonable
-11-
<PAGE> 16
dispatch. No Severable Optional Modification or Nonseverable Optional
Modification shall impair the value, utility or useful life of the Facility or
cause the Facility to be "limited use property" for Federal income tax
purposes; provided, however, that the Lessee shall use its best efforts to
avoid impairing the value, utility or useful life of the Facility or causing it
to become "limited use property" as a consequence of making Required
Modifications and if the Lessee shall have the right to choose alternative
methods for implementing any Required Modification, one of which alternative
methods would avoid impairing the value, utility or useful life of the Facility
or causing it to become "limited use property", the Lessee will implement such
alternative method.
(e) REPORTS OF MODIFICATIONS. On or before April 1 of
each year throughout the Lease Term, commencing April 1, 1995, the Lessee shall
furnish the Lessor with a report describing separately and in reasonable detail
each Modification having a cost in excess of $500,000 which was incorporated in
the Facility during the preceding calendar year (or, in the case of the report
to be furnished on or before April 1, 1995, during the period from the Closing
Date through March 31, 1995). Each such report shall indicate, separately with
respect to each Modification, the actual cost thereof, the arrangement for the
financing thereof and the Person who holds title thereto or to an undivided
interest therein in accordance herewith.
(f) TITLE TO MODIFICATIONS. Title to an undivided
interest, the percentage of which shall be equal to the Lessor's Share, in each
Modification shall vest, as follows:
(1) in the case of each Nonseverable Optional
Modification and each Required Modification, whether or not the Lessor
shall have financed or provided financing therefor (in whole or in
part) by an Additional Equity Investment or a Supplemental Financing,
or both, effective on the date such Modification shall have been
incorporated in the Facility, the Lessor shall, without further act,
acquire title to such an undivided interest therein;
(2) in the case of each Severable Optional Modification,
if the Lessor shall have provided financing therefor (to the full
extent of the Lessor's Share of the actual cost thereof) by an
Additional Equity Investment or a Supplemental Financing, or both,
then effective on the date of payment, or the date on which the Lessor
shall unconditionally be obligated to make payment of an amount equal
to the product obtained by multiplying the cost (or the then estimated
cost) thereof by the Lessor's
-12-
<PAGE> 17
Share, the Lessor shall, without further act, acquire title to such
undivided interest in such Modification; and
(3) in the case of each Severable Optional Modification,
if the Lessor's Share of the cost thereof shall not have been financed
by the Lessor by an Additional Equity Investment or a Supplemental
Financing, or both, title to such Modification shall vest in the
Lessee and, subject only to the provisions of Section 5(a), the Lessor
shall have no interest therein, and neither such Modification nor any
such undivided interest shall thereafter be, or be deemed to be,
incorporated in the Facility or the Undivided Interest.
Immediately upon title to such undivided interest in any Modification vesting
in the Lessor pursuant to clauses (1) or (2) above, such undivided interest in
such Modification shall, without further act, become subject to this Lease and
be deemed part of the Undivided Interest and of the Facility for all purposes
hereof.
(g) FUNDING OF MODIFICATIONS. The Lessee may request
that the Lessor provide financing of an undivided interest, the percentage of
which shall be equal to the Lessor's Share, of the capital cost of any
Modification incorporated in the Facility at any time during the twelve months
preceding such request. The Lessor may, with funds provided by the Owner
Participant, in the Owner Participant's sole discretion, make an additional
direct investment in any such Modification (any such direct investment being
herein referred to as an Additional Equity Investment). If no Bankruptcy
Default, Payment Default or Event of Default shall have occurred and be
continuing, and if the Lessee elects to effect, and arranges, such transaction,
the Lessor shall issue one or more Supplemental Financing Notes to finance (x)
the excess, if any, of (A) an amount equal to the product obtained by
multiplying the actual cost of any such Modification by the Lessor's Share,
over (B) any Additional Equity Investment, or (y) if the Owner Participant
shall elect not to make any Additional Equity Investment, an amount equal to
the product obtained under sub-clause (A) of clause (x) above (such issue being
herein called a Supplemental Financing). Such Supplemental Financing Notes
shall be issued in a Supplemental Financing to one or more Persons (other than
a Person affiliated with the Lessee within the meaning of section 318 of the
Code) under the Indenture and in a public or private sale; provided that, as
conditions precedent to any such issuance and sale (1) the Lessor and the Owner
Participant shall have received a tax opinion satisfactory to the Owner
Participant to the effect that under Applicable Law there is no unindemnified
adverse tax consequence resulting from such Supplemental Financing, (2) the
Notes outstanding immediately prior to a Supplemental
-13-
<PAGE> 18
Financing and the Supplemental Financing Notes will be rated at Investment
Grade upon completion of the Supplemental Financing and Newmont shall not be on
credit watch for a possible downgrade at such time, (3) the Supplemental
Financing Notes shall mature on or prior to the expiration of the Basic Lease
Term and, so long as there are Notes outstanding under the Indenture, the
conditions set forth in Section 2.15(b) of the Indenture shall have been
satisfied, (4) the Supplemental Financing Notes are in an aggregate principal
amount of (x) not less than the Lessor's Share of $10,000,000 and, when added
to the original principal amount of all prior issues of Supplemental
Financing Notes, (y) not more than the Lessor's Share of $40,000,000, (5) such
Supplemental Financing, together with all prior Supplemental Financings, do not
exceed four in number, and (6) the principal amount of the Lessor's
Supplemental Financing Notes, together with the principal amount of all prior
issues of the Lessor's Supplemental Financing Notes and all Notes issued on the
Closing Date, do not exceed 80% of the sum of Facility Cost plus the cost of
all Modifications theretofore financed hereunder and then being financed and
title to which shall have vested or shall then vest in the Lessor. All
Supplemental Financing Notes shall be issued and secured under the Indenture
and shall be pari passu with the Notes. The Lessor shall have the right to
receive any and all certificates, documents, opinions or other instruments as
the Lessor may reasonably request in connection with any such Supplemental
Financing.
(h) FAILURE TO FINANCE; PURCHASE RIGHTS. The failure or
inability of the Lessor to make an Additional Equity Investment or to effect a
Supplemental Financing in respect of any such Modification shall not in any
manner affect the Lessee's obligation to make any Required Modification in
accordance with the terms hereof, in which case the Lessee shall carry out such
obligation at its own expense and title to such Modification shall in such case
vest as provided herein. The preceding sentence to the contrary
notwithstanding, the Lessee shall have the right to terminate this Lease and
purchase the Facility for (i) the applicable Termination Value if the Lessee
shall propose financing of Required Modifications having an aggregate capital
cost greater than $20,000,000, or (ii) the higher of Fair Market Value or
Termination Value if the Lessee shall propose Nonseverable Optional
Modifications having an aggregate capital cost greater than $20,000,000, and,
in either such case, the Lessor shall decline to effect a Supplemental
Financing or the Lessee and the Lessor shall be unable to reach agreement on
satisfactory financing arrangements with respect thereto. In any such case,
the Lessee shall give notice of its election to the Lessor and such purchase
shall occur on the next Rent Payment Date, or if such Rent Payment date shall
be less than twenty (20) days following the date of the foregoing notice, the
second Rent Payment Date following the date of the foregoing notice. If the
Lessee gives notice to the Lessor of its election to exercise the purchase
option provided for in this Section 8(h) and has established
-14-
<PAGE> 19
to the satisfaction of the Lessor the circumstances which entitle it to
exercise such option and, where applicable, the Fair Market Value of the
Undivided Interest, the Lessor shall promptly give notice to the Indenture
Trustee of the Lessee's exercise of such option and on the first Rent Payment
Date thereafter, the Lessee shall pay to the Lessor an amount equal to the
Termination Value or the then Fair Market Value of the Undivided Interest, as
applicable, plus all Basic Rent and Supplemental Rent then due and payable, in
which case this Lease shall terminate and the Lessor shall transfer the
Undivided Interest to the Lessee on an as is, where is basis, free and clear of
all Lessor's Liens and Owner Participant's Liens, but without any other
recourse, representation or warranty.
(i) MARKING. The Lessee agrees, at its own cost, expense
and liability, to maintain in a prominent place a durable, readily visible
inscription of such type and content as from time to time may be required by
law or otherwise deemed necessary by the Lessor or the Indenture Trustee in
order to protect the title of the Lessor to the Undivided Interest, the rights
of the Lessor under this Lease and the Lien of the Indenture Trustee under the
Indenture. The Lessee will promptly replace such marking if the same shall
have been removed, defaced, obliterated or destroyed.
(j) ENVIRONMENTAL COMPLIANCE. In order to protect its
interest therein, but at its own risk and expense, if the Lessee shall have
delivered, or shall be required to deliver, a written notification pursuant to
Section 10(b)(i)(G) of the Participation Agreement, the Lessor shall, during a
reasonable period thereafter, have the right, but not the duty, and acting
solely upon instructions from the Owner Participant, upon reasonable notice, to
either (i) conduct an environmental site assessment of the Site Interest and
Facility, which shall be dedicated to the subject matter of such notice and the
circumstances, events or occurrences described, or required to be described,
therein, or (ii) during regular business hours, inspect the Facility and the
Site Interest and conduct tests thereon to determine the extent to which there
are any conditions, circumstances or practices relating to either the Facility,
the Site Interest or the operation thereof, or to the conduct of activities
thereon, which violate, or give rise to material liability or material
remediation under, any Environmental Law at, upon or within the Site Interest
or the Facility. If, after the Lessee receives from the Lessor a written
request to remediate any material violation of any Environmental Law, the
Lessee fails to do so promptly or, after commencement, to continue diligently
to effect such remediation, the Lessor shall have the right, but not the duty,
and acting solely upon instructions from the Owner Participant, to enter upon
the Site Interest, upon reasonable notice at any reasonable time and at
Lessee's expense, to investigate or to remedy such violation. In exercising
its rights hereunder, the
-15-
<PAGE> 20
Lessor shall use reasonable efforts to minimize interference with the Lessee's
business, but no such entry shall be deemed to violate the Lessor's covenant of
quiet enjoyment and, except in the case of the negligence or wilful misconduct
of the Lessor or its agents, the Lessor shall not be liable for any
interference, loss or damage to the Lessee's property or business caused
thereby.
(k) CONTEST OF REQUIREMENTS OF LAW. If, with respect to
any requirement of Applicable Law or any Governmental Action relating to the
use, operation, maintenance or repair of the Facility, the Facility Site or the
construction or installation of a Modification, the Lessee (i) is contesting
diligently and in good faith by appropriate proceedings such requirement, or
(ii) shall have been excused or exempted by a valid nonconforming use permit,
waiver, variance, extension or forbearance exempting the Lessee from such
requirement and if no Event of Default or Bankruptcy Default has occurred and
is continuing, then the failure by the Lessee to comply with such requirement
shall not constitute a Default or Event of Default hereunder; provided that
such contest or noncompliance does not extend beyond the last day of the Lease
Term and does not involve (1) any danger of foreclosure, forfeiture or loss of
the Facility or the Facility Site or any part thereof, (2) criminal liability
being imposed on the Lessor, the Trust Estate, the Owner Participant, the
Indenture Trustee or the Pass Through Trustee, (3) any substantial danger of
the sale of, or the creation of any Lien (other than a Permitted Lien) on, the
Site Interest, the Easement or the Facility, (4) material civil liability being
imposed on the Lessor, the Trust Estate, the Owner Participant, the Indenture
Trustee or the Pass Through Trustee or (5) with respect to the conditions noted
in clause (ii) above, the extension of the ultimate imposition of such
requirement beyond the last day of the Lease Term. The Lessee shall provide
the Lessor with notice of any contest of the type described in clause (i) above
in detail sufficient to enable the Lessor to ascertain whether such contest
would be reasonably likely to have any adverse effect of the type described in
the above proviso.
SECTION 9. LOSS.
(a) EVENT OF LOSS. In the event that the Facility, the
Easements or the Site Interest shall suffer either (i) an Event of Loss or (ii)
an event which, in the reasonable opinion of the Lessee, might constitute an
Event of Loss, such fact and the date of the occurrence thereof shall promptly
be reported by the Lessee to the Lessor. In the case of any event described in
clause (ii) of the preceding sentence, the Lessee shall determine, within six
months of the occurrence of such event, whether such event constitutes an Event
of Loss and
-16-
<PAGE> 21
shall furnish the Lessor with a copy of the opinion of an independent engineer
upon which such determination is based.
(b) CONSEQUENCES OF AN EVENT OF LOSS. Upon the
occurrence of an Event of Loss, the Lessee shall purchase the Undivided
Interest by paying or causing to be paid to the Lessor the Stipulated Loss
Value applicable on the first following Rent Payment Date occurring at least
twenty (20) days following the occurrence of an Event of Loss, plus any Basic
Rent and additional Supplemental Rent then due and payable, in which case this
Lease shall terminate and the Lessor shall transfer the Undivided Interest to
the Lessee on an as is, where is basis, free and clear of all Lessor's Liens
and Owner Participant's Liens, but without any other recourse, representation
or warranty, express or implied, by the Lessor or the Owner Participant;
provided that where such Event of Loss results from loss, damage or destruction
of the Facility or Site Interest, not later than 60 days prior to such Rent
Payment Date the Lessee may irrevocably elect to, and shall thereafter, rebuild
and restore the Facility and Site Interest to the condition in which it was
required to be maintained at the time of such Event of Loss, in which case this
Lease shall continue in full force and effect; provided further that no such
election to rebuild or restore the Facility and Site Interest shall be
permitted without the consent of the Lessor unless (x) the Lessee has
established to the reasonable satisfaction of the Lessor that the aggregate
uninsured cost of replacing and restoring the Facility and Site Interest and
other assets of Newmont located in the Carlin Complex and damaged at the time
of such occurrence do not exceed $50,000,000, and (y) the Company's then
outstanding senior unsecured debt is rated at or above Investment Grade.
During any period of rebuilding or restoration of the Facility and the Site
Interest after an Event of Loss, payments received by the Lessor, the Indenture
Trustee or the Lessee from any Governmental Authority, insurer or other Person
with respect to such Event of Loss (other than payments of insurance separately
maintained by the Owner Participant which shall be paid to, or retained by the
Owner Participant) shall be paid to or retained by the Indenture Trustee (or
the Lessor after payment in full of the Notes and release of the Lien of the
Indenture) and shall be applied in accordance with the provisions of Section
10(b). If an Event of Loss shall occur during any Renewal Term, the Lessee
shall have the right to terminate this Lease, in which case the Lessee shall
pay to the Lessor the then applicable Stipulated Loss Value on the following
Rent Payment Date as provided above plus all accrued and unpaid Basic Rent and
all Supplemental Rent relating to and payable in consequence of events
occurring prior to the date of such termination.
-17-
<PAGE> 22
(c) Damage Not Constituting an Event of Loss. In the
event of damage to the Facility, the Easements or Site Interest which does not
constitute an Event of Loss, the Lessee shall promptly restore the Facility,
the Easements or Site Interest to the condition to which it is required to be
maintained hereunder.
(d) Excess Loss Proceeds. Payments received by the
Lessor, the Indenture Trustee or the Lessee of the type described in Section
9(b) or Section 9(e) in excess of Stipulated Loss Value or the amounts required
to restore or replace that portion of the Facility or the Site Interest that
has been destroyed, damaged, loss, condemned, confiscated, stolen, seized or
requisitioned, as the case may be, shall be paid to the Lessee or the Lessor as
their respective interests may appear.
(e) Application of Payments Not Relating to an Event of
Loss. Unless a Bankruptcy Default, Payment Default or Event of Default shall
have occurred and be continuing, payments (except under insurance separately
maintained by the Owner Participant) received at any time by the Lessor, the
Indenture Trustee, the Pass Through Trustee or the Lessee from any Governmental
Authority, insurer or other Person with respect to any destruction, damage,
loss, condemnation, confiscation, theft or seizure of or requisition of title
to or use of the Undivided Interest or Lessor's interest in the Site Interest
or any part thereof not constituting an Event of Loss shall be paid to or
retained by the Indenture Trustee (or the Lessor after the payment in full of
the principal of, premium, if any, and interest on, the Notes and the discharge
of the Indenture) and first shall be applied in accordance with the provisions
of Section 10(b) to restore or replace what has been destroyed, damaged, lost,
condemned, confiscated, stolen, seized or requisitioned, and second in
accordance with the provisions of Section 9(d).
(f) Other Dispositions. Notwithstanding the foregoing
provisions of this Section 9, so long as a Bankruptcy Default, Payment Default
or Event of Default shall have occurred and be continuing, any amount that
would otherwise be payable to or for the account of, or that would otherwise be
retained by, the Lessee pursuant to this Section 9 or Section 10 shall be paid
to the Indenture Trustee (or the Lessor after the principal of, premium, if
any, and interest on the Notes shall have been paid in full and the Lien of the
Indenture shall have been discharged) as security for the obligations of the
Lessee under this Lease and, at such time thereafter as no Bankruptcy Default,
Payment Default or Event of Default shall exist, such amount shall be paid
promptly to the Lessee unless this Lease shall theretofore have been declared
to be in default pursuant
-18-
<PAGE> 23
to Section 17(a), in which event such amount shall be disposed of in accordance
with the provisions hereof, of the Indenture and of the Trust Agreement.
SECTION 10. INSURANCE.
(a) Coverages. The Lessee will, at its own expense,
cause to be carried and maintained insurance, with financially sound and
reputable insurers satisfactory to the Lessor, the following insurance with
respect to the Facility and the operation thereof:
(i) "all risk" property insurance with respect to damage
to or destruction of the Facility including fire and extended coverage
insurance, with the broadest coverage then available and in any case
including fire, theft, flood, water damage, collapse, earthquake,
windstorm, hale, boiler and machinery, lightning, explosion and
falling objects (i.e., aircraft) covering the full (100%) replacement
cost of the Facility without deduction for depreciation;
(ii) business interruption insurance covering loss of
revenues attributable to the total or partial suspension or delay of
or interruption in the operation of the Facility caused by loss or
damage to or the destruction of the Facility or the Facility Site as a
result of the perils referred to in clause (i) above;
(iii) comprehensive general liability insurance, including
contractual liability insurance, with a combined single limit of no
less than $50,000,000 per occurrence for bodily injury, including
personal injury, and property damage;
(iv) statutory workers' compensation insurance meeting all
requirements of Applicable Law including coverage for employers'
liability with limits of no less than $500,000 per accident; and
(v) comprehensive automobile liability insurance for all
owned, non-owned, and hired vehicles with bodily injury limits of no
less than $5,000,000 per person, $5,000,000 per accident, and property
damage limits of no less than $5,000,000 per accident.
Deductibles in self insurance amounts with respect to any of such policies
shall not exceed $2,500,000 on a per occurrence basis. All such policies shall
in any
-19-
<PAGE> 24
event be in amounts (after deductibles or self-insurance amounts) and against
risks (i) consistent with Prudent Mining Industry Practice, (ii) at least
comparable in amounts and against risks customarily insured against by the
Lessee for other properties of the Lessee located in the western United States
and (iii) sufficient to prevent the Lessor and the Indenture Trustee from
becoming at any time a co-insurer with respect to any loss relating to events
or occurrences covered under any policy. Any policies with respect to property
insurance shall (i) name the Lessee, the Lessor and the Indenture Trustee as
insureds, as their interests may appear, and name the Indenture Trustee as sole
loss payee so long as any Notes are outstanding and thereafter name the Lessor
as sole loss payee, (ii) waive any right to claim any premiums or commissions
against the Lessor, the Owner Participant or the Indenture Trustee, (iii)
provide that the insurers shall waive any rights of subrogation against the
Lessor, the Owner Participant or the Indenture Trustee, (iv) provide that if
such insurance is cancelled for any reason whatsoever, or any substantial
change is made in the coverage which affects the interest of the Lessor, the
Owner Participant or the Indenture Trustee, or if such insurance is allowed to
lapse for nonpayment of premium, such cancellation, change or lapse shall not
be effective against the Lessor, the Owner Participant or the Indenture Trustee
for 60 days after receipt by the Lessor, the Owner Participant and the
Indenture Trustee, respectively, of written notice from any applicable insurers
of such cancellation, change or lapse, and (v) provide that each of the Lessor,
the Owner Participant and the Indenture Trustee shall be permitted to make
payments to effect the continuation of such insurance coverage upon notice of
cancellation due to nonpayment of premiums. Each such policy shall be primary
without right of contribution from any other insurance which is carried by the
Lessor, the Owner Participant or the Indenture Trustee with respect to its
interest in the Facility. Any policies with respect to general liability shall
name the Lessor, the Owner Participant and the Indenture Trustee as additional
insureds. The Lessee shall, within 30 days after the renewal of each such
policy, furnish to the Lessor, the Owner Participant and the Indenture Trustee
a certificate signed by an independent insurance broker satisfactory to the
Lessor, the Owner Participant and the Indenture Trustee showing the insurance
then maintained by the Lessee pursuant hereto and stating that in the opinion
of such independent broker such insurance complies with the provisions hereof.
The Lessee shall not reduce the amounts of its general liability insurance as
in effect on the Closing Date. In the event that the Lessee shall fail to
maintain insurance as herein provided the Lessor, the Owner Participant or the
Indenture Trustee may at its option maintain insurance which is required to be
maintained by the Lessee hereunder, and, in such event, the Lessee shall
reimburse such party upon demand for the cost thereof, together with interest
thereon at the Overdue Rate, as Supplemental Rent. Nothing in this Section 10
shall prohibit the Lessee or the
-20-
<PAGE> 25
Owner Participant from placing at its expense insurance on or with respect to
the Facility or the Undivided Interest, or the operation of either thereof,
naming the Lessee or the Owner Participant, as the case may be, as insured and
loss payee, in an amount exceeding the amount of insurance required to be
maintained by the Lessee hereunder from time to time, unless, in the case of
insurance maintained by the Lessee, such insurance would conflict with or
otherwise limit the insurance to be provided or maintained by the Lessee in
accordance herewith.
(b) Application of Insurance Proceeds. Subject to
Section 9(f), all insurance proceeds (except under insurance separately
maintained by the Owner Participant) up to $10,000,000 on account of any
physical loss or damage to the Undivided Interest, Lessor's interest in the
Easements or the Site Interest or any part thereof (less the actual costs, fees
and expenses incurred in the collection thereof) shall be paid to the Lessee,
and all insurance proceeds (except under insurance separately maintained by the
Owner Participant) equal to or greater than $10,000,000 in the aggregate on
account of physical loss or damage shall be paid to the Indenture Trustee (or
the Lessor after the principal of, premium, if any, and interest on the Notes
shall have been paid in full and the Lien of the Indenture shall have been
discharged) and all such proceeds shall be applied and dealt with as follows:
(i) except as provided in clause (ii) below, all such
proceeds shall be paid over to the Lessee or as it may direct from
time to time as restoration progresses, to pay (or reimburse the
Lessee for) the cost of restoration, if the amount of such proceeds
received by the Indenture Trustee or the Lessor, together with such
additional amount, if any, theretofore expended by the Lessee out of
its own funds for such restoration, are sufficient to pay the
estimated cost of completing such restoration, but only upon a written
application and an officer's certificate of the Lessee showing in
reasonable detail the nature of such restoration and the estimated
cost to complete such restoration and stating that no Bankruptcy
Default, Payment Default or Event of Default has occurred and is
continuing (which certification shall be concurred in by a licensed
professional engineer). Upon the written request of the Lessee,
accompanied by evidence satisfactory to the Owner Participant and the
Indenture Trustee that such restoration has been completed and the
costs thereof paid in full and that there are no mechanics' or similar
Liens for labor or materials supplied in connection therewith, the
balance, if any, of such proceeds shall be paid over or assigned to
the Lessee or as it may direct; and
-21-
<PAGE> 26
(ii) All such proceeds in respect of an Event of Loss for
which no election has been (or can be) made as provided in Section
9(b) shall be applied to pay Stipulated Loss Value in accordance with
Section 9(b) and thereafter in accordance with Section 9(d).
SECTION 11. INDEMNIFICATION.
The Lessee agrees, whether or not any of the transactions
contemplated hereby shall be consummated and whether or not this Lease shall
have expired or terminated, to assume liability for, and to indemnify, protect,
save and keep harmless each Indemnitee on the terms and conditions set forth in
Section 13 of the Participation Agreement.
SECTION 12. ASSIGNMENT OR SUBLEASE.
The Lessee may not assign its leasehold interest under this
Lease without the Lessor's prior written consent to be given or withheld in the
Lessor's absolute and sole discretion, except that the Lessee may assign its
leasehold interest under this Lease to any of its Affiliates, but unless the
Owner Participant and the Indenture Trustee have consented to such assignment
the Lessee will remain primarily liable for the performance of its obligations
hereunder. Concurrently with any assignment pursuant to this Section 12, the
Lessor, the Indenture Trustee and Owner Participant shall receive satisfactory
assignment and assumption agreements, opinions and any other documents or
instruments reasonably requested by the Lessor, the Indenture Trustee or Owner
Participant in connection with such assignment. So long as the outstanding
senior unsecured debt of Newmont shall be rated Investment Grade, the Lessee
may, without the consent of the Lessor, sublease the Undivided Interest or the
Facility to any Person. Notwithstanding any such sublease, the Lessee will
remain primarily liable for the performance of all of its obligations
hereunder. Any such sublease shall be subject and subordinate to this Lease.
SECTION 13. LEASE RENEWALS.
(a) LEASE RENEWAL. At the end of the Basic Lease Term or
the then applicable Renewal Term, as the case may be, provided that no Event of
Default or Bankruptcy Default shall have occurred and be continuing and the
Notes shall have been paid in full, the Lessee shall have the right to exercise
one
-22-
<PAGE> 27
of the following two options to renew the term of this Lease for the Renewal
Term or Terms described below:
(1) At the end of the Basic Lease Term, the Fixed Rate
Renewal Term, if any, elected by the Lessee under clause (2) below, or
any expiring Fair Market Renewal Term theretofore elected by the
Lessee under this clause (1), upon notice given as provided in Section
13(b), the Lessee may renew the term of this Lease during the
remaining term of the Facility Agreements for one or more periods of
not less than two years (each such period so determined being herein
referred to as a Fair Market Renewal Term), each at a Fair Market
Rental Value, payable on each Rent Payment Date occurring during such
Fair Market Renewal Term; provided, however, that if the Lessee shall
elect more than one Fair Market Renewal Term, all such Fair Market
Renewal Terms shall be successive; and provided, further, that
notwithstanding the foregoing, the last Fair Market Renewal Term may
be for a period of less than two years if the period from the
expiration of the preceding Fair Market Renewal Term to the expiration
date of the Ground Lease and Easement shall be less than two years;
and
(2) Upon notice given as provided in Section 13(b), at
the end of the Basic Lease Term only, the Lessee may renew the term of
this Lease for one period of one year (such period so determined being
herein referred to as the Fixed Rate Renewal Term).
(b) NOTICE. Not less than eighteen months prior to the
expiration date of the Basic Lease Term, the Fixed Rate Renewal Term or any
then applicable Fair Market Renewal Term, the Lessee may indicate its desire to
exercise the lease renewal option described in either Section 13(a)(1) or, only
in respect of the expiration of the Basic Lease Term, Section 13(a)(2). Any
such election shall be irrevocable as to the Lessee, but be binding on the
Lessor only if on the effective date thereof no Event of Default or Bankruptcy
Default shall have occurred and be continuing.
(c) TERMS. All the terms and provisions of this Lease
shall be applicable during any Renewal Term.
(d) DETERMINATIONS. If the Lessee and the Owner
Participant shall have failed to agree upon the Fair Market Rental Value and
the Fair Market Value (which Fair Market Value shall be estimated both as of
the commencement of the relevant Renewal Term and as of the end thereof) of the
Undivided Interest
-23-
<PAGE> 28
at least six months prior to the commencement of the relevant Renewal Term,
such values shall be determined by the Appraisal Procedure.
SECTION 14. PURCHASE OPTIONS.
Unless an Event of Default or Bankruptcy Default shall have
occurred and be continuing, the Lessee shall have the right to exercise one of
the following options to purchase the Undivided Interest:
(1) On the Early Buy-Out Date, at a purchase price equal
to the sum of (a) the Early Buy-Out Price and (b) any Basic Rent and
Supplemental Rent then due (the Early Purchase Option);
(2) On the date of expiration of the Basic Lease Term,
the Fixed Rate Renewal Term or any then applicable Fair Market Renewal
Term, at a purchase price equal to Fair Market Value; or
(3) On the date of expiration of the Basic Lease Term, at
a purchase price equal to the Fixed Price Option Price.
Written notice of the Lessee's election (i) to exercise the Early Purchase
Option shall be given to the Lessor and the Owner Participant at least 180 days
prior to the Early Buy-Out Date or (ii) to purchase the Undivided Interest
under either clause (2) or clause (3) above shall be given to the Lessor and
the Owner Participant at least eighteen months prior to the date of purchase.
Any election hereunder shall be irrevocable as to the Lessee, but be binding on
the Lessor only if on the effective date thereof no Event of Default or
Bankruptcy Default shall have occurred and be continuing. In the event of an
election under clause (2) above, the Lessee and the Owner Participant shall
promptly agree upon the Fair Market Value of the Undivided Interest as of the
date fixed for purchase or, if they shall have failed to agreed on such Fair
Market Value at least six months prior to the date of purchase, such Fair
Market Value shall be determined by the Appraisal Procedure. If the Lessee
shall have elected to purchase the Undivided Interest hereunder, payment of the
applicable purchase price (or, in the case of the Early Purchase Option, the
portion of the Early Buy-Out Price payable on the Early Buy-Out Date, as set
forth in Schedule 4 hereto) be made in immediately available funds against
delivery of (i) a bill of sale transferring and assigning to the Lessee all
right, title and interest of the Lessor in and to the Undivided Interest free
and clear of all Lessor's Liens and all Owner Participant's Liens, but without
other recourse, representation or warranty, and (ii) the agreement of the
Lessor and the Indenture Trustee (if the Indenture shall not have been
satisfied and discharged prior to such date) (in recordable form) terminating
-24-
<PAGE> 29
their respective interests in the Undivided Interest and under the Transaction
Documents to which the Lessor or the Indenture Trustee, as the case may be, is
a party, except that indemnity obligations of the Lessee with respect to
periods prior to the date of purchase shall survive. In connection with any
sale by the Lessor to the Lessee under this Section 14, the Lessor may
specifically disclaim representations and warranties (other than as
contemplated by clause (i) of the preceding sentence) in a manner comparable to
that set forth in the second sentence of Section 6(b).
SECTION 15. EARLY TERMINATION.
(a) In addition to the rights of the Lessee under Section
8 above and subject to the last sentence hereof, on any Rent Payment Date
occurring after July 5, 2003, the Lessee may terminate this Lease if (i) the
Lessee, in its sole discretion (as evidenced by an Officer's Certificate),
shall have determined that the Facility is obsolete or surplus or uneconomic
for the Lessee's needs, (ii) the Facility shall be in the condition and repair
required by Section 5 for the return of the Undivided Interest and (iii) no
Event of Default, Payment Default or Bankruptcy Default shall have occurred and
be continuing. Such termination shall occur on a Rent Payment Date which shall
be not less than six months following the date on which the Lessee shall have
delivered written notice of termination (the Termination Date). On the
Termination Date, unless the Lessor shall have elected to retain the Undivided
Interest pursuant to paragraph (b) hereof, the Lessee shall pay to the Lessor
the Termination Value, plus any Rent then due and payable and unpaid.
Following the notice of termination delivered hereunder, unless the Lessor
shall have elected to retain the Undivided Interest pursuant to paragraph (b)
hereof, the Lessee, as the non-exclusive agent for the Lessor, shall use its
best efforts to effect a sale of the Undivided Interest for cash to a Person
which is not an Affiliate of the Lessee. The Lessee shall certify to the
Lessor the identity of any bidder and the terms of the purchase proposed. The
Lessor shall have the concurrent right to seek, directly or through other
agents, cash bids for such purchase. On the Termination Date the Lessor shall
effect a transfer of the Undivided Interest to the Person, if any, who shall
have submitted the highest bid for the purchase of the Undivided Interest.
Upon any such sale and receipt of the proceeds thereof (but not earlier than
the Termination Date) the net proceeds of such sale shall be paid to the
Lessee, to the extent of Termination Value theretofore paid hereunder, and the
balance, if any, of such proceeds shall be paid to the Lessor. If, however, no
sale of the Undivided Interest shall have been completed on or prior to the
Termination Date, this Lease shall continue in full
-25-
<PAGE> 30
force and effect. It is understood and agreed that the Lessee shall have the
right to deliver a maximum of two notices of termination under this Section 15.
(b) Right of Lessor to Retain Undivided Interest. The
Lessor may with the consent of the Owner Participant irrevocably elect to
retain, rather than sell, the Undivided Interest in the event a termination
notice has been delivered by the Lessee pursuant to paragraph (a) of this
Section 15 by giving written notice to the Lessee and the Indenture Trustee at
least 45 days prior to the Termination Date. If the Lessor elects to retain
the Undivided Interest pursuant to this paragraph (b), the Lessor, on the
Termination Date, shall pay to the Indenture Trustee an amount equal to the
principal amount of the outstanding Notes to be redeemed in connection with
such termination plus all interest accrued on such principal amount to the
applicable Redemption Date as provided for in the Indenture plus the premium,
if any, due on the Notes on such Termination Date. If the Lessor elects to
retain the Undivided Interest pursuant to this paragraph (b), the Lessee shall
(A) pay to the Lessor on the Termination Date any unpaid Rent (including an
amount equal to the prepayment premium, if any, due on the Notes and the
interest which will accrue on the principal amount of the Notes to be redeemed
in connection with such termination to the Termination Date) due on or prior to
such Termination Date, but shall not be required to pay Termination Value and
(B) deliver to the Lessor on the Termination Date such instrument as the Lessor
shall reasonably request to evidence the release of the Undivided Interest from
all Liens other than Lessor's Liens, Owner Participant's Liens or the Lien of
the Indenture.
SECTION 16. EVENTS OF DEFAULT.
(a) The term Event of Default, wherever used herein,
shall mean any of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary, or come about or be
effected by operation of law, or be pursuant to or in compliance with any
Governmental Rule or Governmental Action):
(1) the Lessee shall fail to make, or cause to be made,
payment of Basic Rent, Stipulated Loss Value, Termination Value or any
payment required to be made in accordance with Section 3.2(b) of the
Tax Indemnity Agreement within 5 Business Days after the due date; or
-26-
<PAGE> 31
(2) the Lessee shall fail to make any other payment of
Supplemental Rent within 20 Business Days after receipt by the Lessee
of written notice from the Lessor; or
(3) the Lessee shall fail to perform or observe in any
material respect any other covenant, condition or agreement to be
performed or observed by it hereunder, or under any other Transaction
Document, which failure shall continue unremedied for 30 days after
receipt of written notice from the Lessor, unless (a) such default is
curable but cannot be cured within 30 days (it being understood that a
breach of Section 12 is not a curable Default), and (b) the Lessee is
diligently pursuing the cure of such default, provided that, unless
Lessee exercises its purchase option in accordance with paragraph (b)
below, such default must be cured within 365 days, except that certain
defaults, such as operating the Facility in violation of Environmental
Laws, which would materially reduce the value of the Facility or
expose the Owner Participant or the Owner Trustee to recourse
liability, must be cured within 90 days; or
(4) any material representation or warranty (other than
the Lessee's Tax Representations) by the Lessee in this Lease, any
other Transaction Document to which the Lessee is a party, or any
agreement, document or certificate delivered by the Lessee in
connection herewith or therewith shall prove to have been incorrect in
any material respect when any such representation or warranty was made
or given, shall remain material when discovered and shall not have
been cured within 30 days after receipt of written notice by the
Lessee from the Lessor, unless the Lessee shall be diligently
proceeding to cure such representation and shall effect such cure
within 180 days after receipt of such written notice; or
(5) the Lessee 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 or agency 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 an involuntary case or other
proceeding
-27-
<PAGE> 32
shall be commenced against the Lessee 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 or agency 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 90 days; or
(6) the declaration of an event of default under any
Financing Lease to which the Lessee is a party, as
lessee;
(7) the Ground Lease and Easement shall have terminated
or be of no further force and effect, or
(8) the Lessee shall have failed to maintain the
insurance required by clauses (i) and (iii) of Section 10(a) and such
failure has continued for five Business Days after written notice
thereof from the Lessor.
(b) Incurable Default. Notwithstanding Sections 16(a)(3)
and 16(a)(4), if (i) the Lessee is diligently pursuing the cure of a Default
which has remained unremedied for a period of at least (x) 270 days, in the
case of Defaults under Section 16(a)(3) (70 days, if the applicable cure period
is 90 days in accordance with Section 16(a)(3)), or (y) 100 days, in the case
of Defaults under Section 16(a)(4), (ii) the Lessee, in its reasonable
judgment, does not believe that such Default can be cured within the applicable
cure period, and (iii) the Lessee has demonstrated to the reasonable
satisfaction of the Owner Participant its inability to cure such Default within
such applicable cure period, the Lessee shall have the right, upon at least 20
days' written notice, to purchase the Undivided Interest at the end of the
applicable cure period. On the first Business Day following the end of such
applicable cure period, the Lessee shall pay to the Lessor the higher of the
then Fair Market Value of the Facility or the Stipulated Loss Value and the
Lessor shall deliver to the Lessee the documents stipulated in the penultimate
sentence of Section 14.
SECTION 17. REMEDIES.
(a) REMEDIES. Upon the occurrence of any Event of
Default and so long as the same shall be continuing, the Lessor may, at its
option, declare this Lease to be in default by written notice to such effect
given to the Lessee,
-28-
<PAGE> 33
and at any time thereafter the Lessor may exercise one or more of the following
remedies, as the Lessor in its sole discretion shall elect:
(1) the Lessor may, by notice to the Lessee, rescind or
terminate this Lease and exercise its rights under the Facility
Agreements;
(2) the Lessor may sell the Undivided Interest, together
with its interest under the Ground Lease and Easement, the Facility
Agreements and any other Transaction Document to which the Lessor is a
party, or any part thereof, at public or private sale, as the Lessor
may determine, free and clear of any rights of the Lessee in the
Undivided Interest and without any duty to account to the Lessee with
respect to such action or inaction or any proceeds with respect
thereto (except to the extent required by paragraph (4) below if the
Lessor shall elect to exercise its rights thereunder), in which event
the Lessee's obligation to pay Basic Rent hereunder for periods
commencing after the date of such sale shall be terminated (except to
the extent that Basic Rent is to be included in computations under
paragraph (3) or (4) below if the Lessor shall elect to exercise its
rights thereunder);
(3) the Lessor may, whether or not the Lessor shall have
exercised or shall thereafter at any time exercise its rights under
paragraph (2) above, demand, by written notice to the Lessee
specifying a payment date not earlier than 10 days after the date of
such notice, that the Lessee pay to the Lessor, and the Lessee shall
pay to the Lessor, on the payment date specified in such notice, as
liquidated damages for loss of a bargain and not as a penalty (in lieu
of the Basic Rent due after the payment date specified in such
notice), any unpaid Rent due through the payment date specified in
such notice plus whichever of the following amounts the Lessor, in its
sole discretion, shall specify in such notice (together with interest
on such amount at the interest rate specified in Section 3(b)(3) from
the payment date specified in such notice to the date of actual
payment):
(i) an amount equal to the excess, if any, of
Stipulated Loss Value, computed as of the payment date
specified in such notice, over the Fair Market Rental Value of
the Undivided Interest (determined on the basis of the actual
condition of the Facility) until the end of the Basic Lease
Term or the then applicable Renewal Term, after discounting
such Fair Market Rental Value semiannually to present value as
of the payment date
-29-
<PAGE> 34
specified in such notice at a rate equal to the Overdue Rate
as of the date of such notice;
(ii) an amount equal to the excess, if any, of
such Stipulated Loss Value over the Fair Market Value of the
Undivided Interest (determined on the basis of the actual
condition of the Facility) as of the payment date specified in
such notice;
(iii) an amount equal to the greater of (A) such
Stipulated Loss Value, (B) such discounted Fair Market Rental
Value or (C) such Fair Market Value (assuming, in the case of
(B) and (C) above, that the Facility was then maintained in
accordance with this Lease) and, in such event, upon full
payment by the Lessee of all sums due hereunder, the Lessor
shall, at its option, either (x) exercise its reasonable best
efforts promptly to sell the Undivided Interest together with
its interest under the Facility Agreements and any other
Transaction Document to which the Lessor is a party, and pay
over to the Lessee the sale proceeds up to the amount claimed
under (A), (B) or (C) above and actually paid by the Lessee to
the Lessor, or (y) deliver to the Lessee (AA) a bill of sale
transferring and assigning to the Lessee all right, title and
interest of the Lessor in and to the Undivided Interest free
and clear of all Lessor's Liens and Owner Participant's Liens,
but without recourse or warranty, and (BB) the agreement of
the Lessor terminating its interest under the Facility
Agreements and any other Transaction Document to which the
Lessor is a party, whereupon this Lease shall terminate,
except that indemnity obligations of the Lessee that relate to
the period prior to the date of termination shall survive; or
(iv) an amount equal to the excess of (A) the
present value as of the payment date specified in such notice
of all installments of Basic Rent until the end of the Basic
Lease Term, discounted semiannually at a rate equal to the
Average Applicable Rate, over (B) the present value as of such
payment date of the Fair Market Rental Value of the Undivided
Interest (determined on the basis of the actual condition of
the Facility) until the end of the Basic Lease Term,
discounted semiannually at a rate equal to the Average
Applicable Rate; or
-30-
<PAGE> 35
(4) if the Lessor shall have sold the Undivided Interest
together with its interest under the Ground Lease and Easement, the
Facility Agreements and any other Transaction Document to which the
Lessor is a party pursuant to paragraph (2) above, the Lessor, in lieu
of exercising its rights under paragraph (3) above with respect to the
Undivided Interest and its interest under the Facility Agreements and
any other Transaction Document to which the Lessor is a party, may, if
it shall so elect, demand that the Lessee pay to the Lessor, and the
Lessee shall pay to the Lessor, on the date of such sale, as
liquidated damages for loss of a bargain and not as a penalty (in lieu
of Basic Rent due for periods commencing after the next Basic Rent
payment date following the date of such sale), any unpaid Basic Rent
and Supplemental Rent due through such payment date, plus the amount
of any deficiency between the sale proceeds and Stipulated Loss Value,
computed as of such payment date, together with interest at the
Overdue Rate on the amount of such Rent and such deficiency from the
date of such sale until the date of actual payment.
(b) NO RELEASE. No rescission or termination of this
Lease, in whole or in part, or repossession of the Undivided Interest or
exercise of any remedy under paragraph (a) of this Section 17 shall, except as
specifically provided therein, relieve the Lessee of any of its liabilities and
obligations hereunder. In addition, the Lessee shall be liable, except as
otherwise provided above, for any and all unpaid Rent due hereunder before,
after or during the exercise of any of the foregoing remedies, including all
reasonable legal fees and other costs and expenses incurred by the Lessor or
the Indenture Trustee by reason of the occurrence of any Event of Default or
the exercise of the Lessor's remedies with respect thereto. At any sale of the
Undivided Interest and the Lessor's interest under the Ground Lease and
Easement, the Facility Agreements and any Transaction Documents to which the
Lessor is a party or any part thereof pursuant to Section 17(a), the Lessor,
the Owner Participant or the Indenture Trustee may bid for and purchase such
property.
(c) REMEDIES CUMULATIVE. No remedy under paragraph (a)
of this Section 17 is intended to be exclusive, but each shall be cumulative
and in addition to any other remedy provided under such paragraph (a) or
otherwise available to the Lessor at law or in equity. No express or implied
waiver by the Lessor of any Default or Event of Default hereunder shall in any
way be, or be construed to be, a waiver of any future or subsequent Default or
Event of Default. The failure or delay of the Lessor in exercising any rights
granted it hereunder upon any occurrence of any of the contingencies set forth
herein shall not constitute a waiver of any such right upon the continuation or
recurrence of
-31-
<PAGE> 36
any such contingencies or similar contingencies and any single or partial
exercise of any particular right by the Lessor shall not exhaust the same or
constitute a waiver of any other right provided herein. To the extent
permitted by Applicable Law, the Lessee hereby waives any rights now or
hereafter conferred by statute or otherwise which may require the Lessor to
sell, lease or otherwise use the Undivided Interest or the Facility in
mitigation of the Lessee's damages as set forth in paragraph (a) of this
Section 17 or which may otherwise limit or modify any of the Lessor's rights
and remedies provided in such paragraph.
(d) EXERCISE OF OTHER RIGHTS OR REMEDIES. In addition to
all other rights and remedies provided in this Section 17, the Lessor may
exercise any other right or remedy that may be available to it under Applicable
Law or proceed by appropriate court action to enforce the terms hereof or to
recover damages for the breach hereof.
SECTION 18. NOTICES.
All communications and notices provided for in this Lease
shall be given in person or by means of telex, facsimile, or other wire
transmission (with request for assurance of receipt in a manner typical with
respect to communications of that type), or mailed by registered or certified
mail, or by a nationally recognized overnight courier service, addressed as
follows:
(i) if to the Lessor:
Shawmut Bank Connecticut, National Association,
as OwnerTrustee
777 Main Street
Hartford, CT 06115
Attention: Corporate Trust Administration;
(ii) if to the Lessee:
Newmont Gold Company
One United Bank Center
1700 Lincoln Street
Denver, CO 80203
Attention: Treasurer;
-32-
<PAGE> 37
(iii) in each case with copies to:
(A) the Indenture Trustee:
The First National Bank of Chicago,
as Indenture Trustee
One First National Plaza, Suite 0126
Chicago, IL 60670
Attention: Corporate Trust Division;
and
(B) the Owner Participant:
Philip Morris Capital Corporation
800 Westchester Avenue
Rye Brook. NY 10573-1301
Attention: Vice President-Leasing
or at such other address as such parties or such Persons shall from time to
time designate by notice in writing to such other parties or such other
Persons. All such communications and notices given in such manner shall be
effective on the date of receipt of such communication or notice.
SECTION 19. SUCCESSORS AND ASSIGNS.
This Lease, including all agreements, covenants,
representations and warranties, shall be binding upon and inure to the benefit
of the Lessor and its successors and permitted assigns, and the Lessee and its
successors and, to the extent permitted hereby, assigns.
SECTION 20. RIGHT TO PERFORM FOR LESSEE.
If the Lessee shall fail to make any payment of Rent to be
made by it hereunder or shall fail to perform or comply with any of its other
agreements contained herein, the Lessor, the Owner Participant or the Indenture
Trustee may, but shall not be obligated to, make such payment or perform or
comply with such agreement, and the amount of such payment and the amount of
all costs and expenses (including reasonable attorneys' and other
professionals' fees and expenses) of the Lessor, the Owner Participant or the
Indenture Trustee incurred in connection with such payment or the performance
of or compliance
-33-
<PAGE> 38
with such agreement, as the case may be, together with interest thereon at the
Overdue Rate, shall be deemed Supplemental Rent, payable by the Lessee upon
demand.
SECTION 21. AMENDMENTS AND MISCELLANEOUS.
(a) AMENDMENTS IN WRITING. The terms of this Lease shall
not be waived, altered, modified, amended, supplemented or terminated in any
manner whatsoever except by written instrument signed by the Lessor and the
Lessee.
(b) SURVIVAL. All agreements, indemnities,
representations and warranties contained in the Transaction Documents or any
agreement, document or certificate delivered pursuant hereto or thereto or in
connection herewith or therewith shall survive the execution and delivery of
this Lease and the expiration or other termination of this Lease.
(c) SEVERABILITY OF PROVISIONS. Any provision of this
Lease which may be determined by competent authority to be prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and no such prohibition or
unenforceability in any jurisdiction shall invalidate or render unenforceable
such provision in any other jurisdiction. To the extent permitted by
Applicable Law, the Lessee hereby waives any provision of law which renders any
provision hereof prohibited or unenforceable in any respect.
(d) TRUE LEASE. This Lease constitutes an agreement of
lease as to the Undivided Interest, and an agreement of sublease as to the
undivided interest in the Site Interest, and nothing herein shall be construed
as conveying to the Lessee any right, title or interest in or to the Facility
(including the Undivided Interest) or the Site Interest (including such
undivided interest), except as lessee or sublessee.
(e) ORIGINAL LEASE. The single executed original of this
Lease marked "Original" shall be the "Original" of this Lease. To the extent
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 other than the "Original".
-34-
<PAGE> 39
(f) OTHER LEASE. Newmont shall not exercise its rights
to terminate the Other Lease and/or purchase the interest in the Facility being
leased thereby under section 8(h), 9(b), 14, 15 thereof, to renew such Other
Lease under Section 13 thereof, to assign or sublease the interest leased
thereby to any Person pursuant to Section 12 thereof or to cause the Other
Owner Trustee to issue notes pursuant to Section 8(g) thereof or Section 14 of
the Other Participation Agreement, unless Newmont, as Lessee, shall be capable
at such time of taking the same actions under the parallel sections of this
Lease or the Participation Agreement, as the case may be, and concurrently
exercises its right to do so.
(g) GOVERNING LAW. To the extent permitted by Applicable
Law, this Lease shall be governed by and construed in accordance with the law
of the State of New York.
(h) HEADINGS. The division of this Lease into sections,
the provision of a table of contents and the insertion of headings are for
convenience of reference only and shall not affect the construction or
interpretation of this Lease.
(i) COUNTERPART EXECUTION. This Lease may be executed in
any number of counterparts and by each of the parties hereto on separate
counterparts, all such counterparts together constituting but one and the same
instrument, with
-35-
<PAGE> 40
the counterparts delivered to the Indenture Trustee pursuant to the Indenture
being deemed the "Original" and all other counterparts being deemed duplicates.
IN WITNESS WHEREOF, the parties hereto have each caused this
Lease to be duly executed as of the date first above written, by their
respective officers thereunto duly authorized.
SHAWMUT BANK CONNECTICUT, N.A.,
not in its individual capacity,
but solely as Owner Trustee
under Trust Agreement [No. 1][No. 2],
dated as of July 15, 1994, with
Philip Morris Capital Corporation
By
--------------------------------------
[Title:]
NEWMONT GOLD COMPANY,
as Lessee
By
--------------------------------------
Treasurer
-36-
<PAGE> 41
SCHEDULE 1
to
LEASE
PRICING ASSUMPTIONS
Basic Rent, Stipulated Loss Value, Special Casualty and Early
Buy-Out Price, as set forth in the Lease as originally executed, have been
computed on the basis of the following pricing assumptions:
INVESTMENT PERCENTAGE 24.39462%
LOAN PERCENTAGE 75.60538%
INTEREST RATE ON INITIAL SERIES NOTE 8.45% per annum
(WEIGHTED AVERAGE)
DEPRECIATION DEDUCTIONS 7-year recovery period
deductions in respect of
99.75% of Facility Cost; and
15-year recovery period
deductions in respect of
0.25% of Facility Cost
OWNER PARTICIPANT'S TAX YEAR-END December 31
CLOSING DATE September 28, 1994
TRANSACTION EXPENSES 1% of Facility Cost paid by
the Owner Participant in
addition to its Investment
INTERIM RENT An amount equal to accrued
and unpaid interest on the
Notes through July 5, 1995.
-1-
<PAGE> 42
SCHEDULE 1
to
LEASE
RENT PAYMENT DATES January 5 and July 5 of each
year, except that the last
Rent Payment Date shall
occur on September 28, 2015
FIRST RENT PAYMENT DATE July 5, 1995
EARLY BUY-OUT DATE January 5, 2012
LAST RENT PAYMENT DATE September 28, 2015
MARGINAL TAX RATE 35%, plus 1% in respect of
state tax
ESTIMATED TAX PAYMENTS 100% current, quarterly
ACCOUNTING METHOD Accrual
AMORTIZATION OF NOTES See attachments
-2-
<PAGE> 43
SCHEDULE 2
to
LEASE
SCHEDULE OF BASIC RENT PAYMENTS
<TABLE>
<CAPTION>
Basic Rent Rental Basic
Payment Date Period Rent Percentage
------------ ------ ---------------
<S> <C> <C>
January 5, 1996
July 5, 1996
January 5, 1997
July 5, 1997
January 5, 1998
July 5, 1998
January 5, 1999
July 5, 1999
January 5, 2000
July 5, 2000
January 5, 2001
July 5, 2001
January 5, 2002
July 5, 2002
January 5, 2003
July 5, 2003
January 5, 2004
July 5, 2004
January 5, 2005
July 5, 2005
January 5, 2006
July 5, 2006
January 5, 2007
July 5, 2007
January 5, 2008
July 5, 2008
January 5, 2009
July 5, 2010
January 5, 2011
July 5, 2011
January 5, 2012
</TABLE>
-1-
<PAGE> 44
SCHEDULE 2
to
LEASE
<TABLE>
<S> <C>
July 5, 2012
January 5, 2013
July 5, 2013
January 5, 2014
July 5, 2014
January 5, 2015
July 5, 2015
September 28, 2015
</TABLE>
-2-
<PAGE> 45
SCHEDULE 3
to
LEASE
SCHEDULE OF STIPULATED LOSS VALUES
<TABLE>
<CAPTION>
Percent
of
Date Facility Cost
---- -------------
<S> <C>
Sep 28, 1994 103.31371
Jul 5, 1995 110.35541
Jan 5, 1996 114.58518
Jul 5, 1996 110.29407
Jan 5, 1997 114.08924
Jul 5, 1997 109.50849
Jan 5, 1998 113.05253
Jul 5, 1998 108.25087
Jan 5, 1999 111.60014
Jul 5, 1999 106.61045
Jan 5, 2000 109.73313
Jul 5, 2000 104.53088
Jan 5, 2001 107.46148
Jul 5, 2001 102.07539
Jan 5, 2002 104.85799
Jul 5, 2002 99.36320
Jan 5, 2003 102.05956
Jul 5, 2003 96.50001
Jan 5, 2004 99.11080
Jul 5, 2004 93.43806
Jan 5, 2005 95.97758
Jul 5, 2005 90.11072
Jan 5, 2006 92.57105
Jul 5, 2006 84.92261
Jan 5, 2007 87.27127
Jul 5, 2007 79.27591
Jan 5, 2008 81.50246
Jul 5, 2008 73.37168
Jan 5, 2009 75.47416
Jul 5, 2009 67.20460
Jan 5, 2010 69.18105
Jul 5, 2010 60.76976
Jan 5, 2011 62.61863
Jul 5, 2011 54.06297
Jan 5, 2012 55.78314
Jul 5, 2012 46.86531
Jan 5, 2013 37.95394
Jul 5, 2013 39.24140
Jan 5, 2014 29.92397
Jul 5, 2014 31.01717
Jan 5, 2015 21.39448
Jul 5, 2015 22.21205
Sep 28, 2015 20.00000
</TABLE>
-1-
<PAGE> 46
SCHEDULE 4
to
LEASE
SCHEDULE OF EARLY BUY-OUT PRICE
<TABLE>
<CAPTION>
Percent
of
Date Facility Cost
---- -------------
<S> <C>
January 5, 2012 47.7000%
Payable In Installments, as follows:
January 5, 2012 30.76164%
April 15, 2012 4.23459
June 15, 2012 4.23459
September 15, 2012 4.23459
December 15, 2012 4.23459
</TABLE>
-1-
<PAGE> 47
SCHEDULE 5
to
LEASE
SCHEDULE OF TERMINATION VALUES
<TABLE>
<CAPTION>
Termination Date Termination Value
- ---------------- -----------------
<S> <C>
Sep 28, 1994 103.31371
Jul 5, 1995 110.35541
Jan 5, 1996 114.58518
Jul 5, 1996 110.29407
Jan 5, 1997 114.08924
Jul 5, 1997 109.50849
Jan 5, 1998 113.05253
Jul 5, 1998 108.25087
Jan 5, 1999 111.60014
Jul 5, 1999 106.61045
Jan 5, 2000 109.73313
Jul 5, 2000 104.53088
Jan 5, 2001 107.46148
Jul 5, 2001 102.07539
Jan 5, 2002 104.85799
Jul 5, 2002 99.36320
Jan 5, 2003 102.05956
Jul 5, 2003 96.50001
Jan 5, 2004 99.11080
Jul 5, 2004 93.43806
Jan 5, 2005 95.97758
Jul 5, 2005 90.11072
Jan 5, 2006 92.57105
Jul 5, 2006 84.92261
Jan 5, 2007 87.27127
Jul 5, 2007 79.27591
Jan 5, 2008 81.50246
Jul 5, 2008 73.37168
Jan 5, 2009 75.47416
Jul 5, 2009 67.20460
Jan 5, 2010 69.18105
Jul 5, 2010 60.76976
Jan 5, 2011 62.61863
Jul 5, 2011 54.06297
Jan 5, 2012 55.78314
Jul 5, 2012 46.86531
Jan 5, 2013 37.95394
Jul 5, 2013 39.24140
Jan 5, 2014 29.92397
Jul 5, 2014 31.01717
Jan 5, 2015 21.39448
Jul 5, 2015 22.21205
Sep 28, 2015 20.00000
</TABLE>
-1-
<PAGE> 48
EXHIBIT A
TO
LEASE
CERTIFICATE OF ACCEPTANCE
Dated September __, 1994
Reference is hereby made to the LEASE, dated as of September
1, 1995 (the LEASE), between SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity, but solely as Owner Trustee under Trust
Agreement [No. 1][No. 2], dated as of July 15, 1994, with Philip Morris Capital
Corporation, as Lessor (the LESSOR) and NEWMONT GOLD COMPANY, as Lessee (the
LESSEE).
(1) THE FACILITY.
The Lessee hereby certifies that the Facility, an Undivided
Interest in which, equal to the Lessor's Share, is the subject of the Lease
referred to herein, has been inspected by the Lessee, found to be in good order
and is ready and available for use. The Lessee hereby further certifies that
the Undivided Interest has been accepted under the Lease on the date hereof.
All capitalized terms used herein and not otherwise defined herein shall have
the meanings set forth in Appendix A to the Participation Agreement, dated as
of July 15, 1994, among Philip Morris Capital Corporation, as Owner
Participant, the Lessor, Shawmut Bank Connecticut, N.A. in its individual
capacity and as Owner Trustee, The First National Bank of Chicago, as Indenture
Trustee, The First National Bank of Chicago in its individual capacity and as
Pass Through Trustee and the Lessee.
(2) REPRESENTATIONS BY THE LESSEE.
The Lessee hereby represents and warrants to the Owner
Participant, the Lessor, and the Indenture Trustee that:
(a) The representations and warranties of the Lessee set
forth in the Participation Agreement are true and correct in all
material respects as though made on and as of the date of hereof;
-1-
<PAGE> 49
EXHIBIT A
to
LEASE
(b) The Lessee has satisfied or complied with all
requirements set forth in the Participation Agreement to be satisfied
or complied with on or prior to the date hereof;
(c) No Default or Event of Default has occurred and is
continuing on the date hereof;
(d) The Lessee has obtained, or caused to be obtained,
and there are in full force and effect, such insurance policies with
respect to the Facility and the Facility Site as are required to be
obtained under the terms of the Lease; and
(e) The Lessee has caused the Facility to be duly marked
in accordance with Section 8(i) of the Lease.
IN WITNESS WHEREOF, the Lessee has caused this Certificate of
Acceptance to be duly executed by one of its officers thereunto duly authorized
this __ day of September, 1994.
NEWMONT GOLD COMPANY,
as Lessee
By
------------------------------
Treasurer
Accepted on the date set forth above
on behalf of the Lessor:
SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION,
as Owner Trustee
By
-----------------------------
Title:
-2-
<PAGE> 1
EXHIBIT 4.5
================================================================================
TRUST INDENTURE AND SECURITY AGREEMENT
DATED AS OF JULY 15, 1994,
BETWEEN
SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION,
AS
OWNER TRUSTEE UNDER
TRUST AGREEMENT [NO. 1][NO. 2], DATED AS OF
JULY 15, 1994,
WITH PHILIP MORRIS CAPITAL CORPORATION
AND
THE FIRST NATIONAL BANK OF CHICAGO,
NOT INDIVIDUALLY BUT
SOLELY AS INDENTURE TRUSTEE
================================================================================
NEWMONT GOLD ORE TREATMENT FACILITY
TRUST [NO. 1][NO. 2]
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
GRANTING CLAUSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
HABENDUM CLAUSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 1.01. Indenture Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 1.02. Other Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE II THE NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.01. Forms of the Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.02A. Issuance of Notes on the Closing Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 2.02B. Refunding; ERISA Representation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 2.03. Execution, Delivery and Authentication of Notes; Form and Maximum Aggregate Principal Amount;
Payment of Interest and Principal; Notice and Calculation of Treasury Rate, Make Whole
Premium Amount. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.04. Taxes; Withholding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 2.05. Payments from Indenture Estate Only . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 2.06. Method of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 2.07. Application of Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.08. Termination of Interest in Indenture Estate . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.09. Registration, Transfer and Exchange of Notes . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.10. Mutilated, Destroyed, Lost or Stolen Notes . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 2.11. Payment of Expenses on Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.12. Optional Redemption Upon Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.13. Mandatory Redemption in Whole . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 2.14. Optional Redemption Relating to a Refunding . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 2.15. Supplemental Financing Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
</TABLE>
(i)
<PAGE> 3
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE TRUST INDENTURE ESTATE . . . . . . . . 30
SECTION 3.01. Application of Certain Payments of Rent. . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 3.02. Event of Loss, Termination, Refunding, Purchase on Early Buy-Out Date, Etc. . . . . . . . . 31
SECTION 3.03. Payment After Acceleration of the Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 3.04. Certain Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 3.05. Other Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 3.06. Payments to Owner Trustee or Lessee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 3.07. Investment of Amounts Held by Indenture Trustee . . . . . . . . . . . . . . . . . . . . . . 34
ARTICLE IV INDENTURE EVENTS OF DEFAULT; REMEDIES OF INDENTURE TRUSTEE . . . . . . . . . . . . . . . . . . 35
SECTION 4.01. Indenture Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 4.02. Certain Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 4.03. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 4.04. Return of Indenture Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 4.05. Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 4.06. Discontinuance of Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 4.07. Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
ARTICLE V DUTIES OF THE INDENTURE TRUSTEE AND RIGHTS OF OWNER TRUSTEE . . . . . . . . . . . . . . . . . . 42
SECTION 5.01. Notice of Indenture Event of Default; Certain Duties and Responsibilities . . . . . . . . . 42
SECTION 5.02. Action Upon Instructions: Delivery of Written Instructions to Owner Trustee . . . . . . . . 43
SECTION 5.03. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 5.04. No Duties Except as Specified in Indenture or Instructions and Maintenance of Payment Account 44
SECTION 5.05. No Action Except Under Lease, Indenture or Instructions . . . . . . . . . . . . . . . . . . 45
SECTION 5.06. Furnishing of Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 5.07. Certain Rights of Owner Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
</TABLE>
(ii)
<PAGE> 4
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE VI THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 6.01. Covenants of Owner Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 6.02. Acceptance of Trusts and Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 6.03. Absence of Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 6.04. No Representations or Warranties as to Facility or Documents . . . . . . . . . . . . . . . . 49
SECTION 6.05. No Segregation of Monies; No Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 6.06. Reliance; Agents; Advice of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 6.07. Capacity in Which Acting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 6.08. Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
ARTICLE VII SUCCESSOR TRUSTEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 7.01. Notice of Successor Owner Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 7.02. Resignation of Indenture Trustee; Appointment of Successor . . . . . . . . . . . . . . . . . 51
SECTION 7.03. Appointment of Additional and Separate Indenture Trustees . . . . . . . . . . . . . . . . . 53
ARTICLE VIII SUPPLEMENTS AND AMENDMENTS TO THIS INDENTURE AND OTHER TRANSACTION DOCUMENTS . . . . . . . . . 55
SECTION 8.01. Amendments, Waivers, Etc. of Transaction Documents (Other Than This Indenture) . . . . . . . 55
SECTION 8.01A. Amendments to This Indenture With and Without Consent of Holders . . . . . . . . . . . . . . 56
SECTION 8.02. Supplemental Indenture Without Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 8.03. Trustees and Representative Protected . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 8.04. Documents Mailed to Holder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 8.05. Form of Amendments and Other Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
ARTICLE IX MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 9.01. Termination of Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 9.02. No Legal Title to Indenture Estate in Holders . . . . . . . . . . . . . . . . . . . . . . . 58
</TABLE>
(iii)
<PAGE> 5
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 9.03. Sale of Undivided Interest by Indenture Trustee is Binding . . . . . . . . . . . . . . . . . . . 59
SECTION 9.04. Indenture for Benefit of Owner Trustee, Indenture Trustee, Owner Participant, Lessee and Holders 59
SECTION 9.05. No Action Contrary to Lessee's Rights Under the Lease . . . . . . . . . . . . . . . . . . . . . 59
SECTION 9.06. Notices, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 9.07. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.08. No Oral Modifications or Continuing Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.09. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.10. Headings; References to Sections, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.11. Normal Commercial Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.12. Governing Law: Counterpart Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SCHEDULE 1 Definitions
EXHIBIT A Form of Indenture Supplement
</TABLE>
(iv)
<PAGE> 6
TRUST INDENTURE AND SECURITY AGREEMENT
TRUST [NO. 1][NO. 2]
THIS TRUST INDENTURE AND SECURITY AGREEMENT, dated as of July
15, 1994 (this Indenture), between SHAWMUT BANK CONNECTICUT, NATIONAL
ASSOCIATION, a national banking association having its principal office at 777
Main Street, Hartford, CT 06115, as Owner Trustee under Trust Agreement
[No. 1][No. 2] referred to below, and THE FIRST NATIONAL BANK OF CHICAGO, a
national banking association having its principal office at One First National
Plaza, Suite 0126, Chicago, Illinois 60670-0126, not individually but solely
as Indenture Trustee hereunder.
W I T N E S S E T H :
WHEREAS, all capitalized terms used herein shall have the
respective meanings set forth or referred to in Article I hereof;
WHEREAS, the Owner Participant and the Owner Trustee have
entered into Trust Agreement [No. 1][No. 2], dated as of July 15, 1994,whereby,
among other things, (i) the Owner Trustee has declared a certain trust for the
use and benefit of the Owner Participant and (ii) the Owner Trustee has been
authorized and directed to execute and deliver this Indenture;
WHEREAS, the Owner Trustee has entered into the Participation
Agreement among the Owner Participant, the Indenture Trustee, the Pass Through
Trustee and Newmont;
WHEREAS, the Owner Trustee, acting as trustee for the benefit
of the Owner Participant, pursuant to Trust Agreement [No. 1][No. 2] and the
Participation Agreement, intends to purchase the Undivided Interest from
Newmont and lease such Undivided Interest to Newmont pursuant to the Lease;
WHEREAS, the Owner Trustee desires by this Indenture, among
other things (i) to provide for the issuance by the Owner Trustee (x) as of the
Closing Date
<PAGE> 7
of its initial Notes evidencing the repayment obligations of the Owner Trustee
in respect of such Notes, (y) from time to time, of Supplemental Financing
Notes evidencing the repayment obligations of the Owner Trustee in respect of a
Supplemental Financing, and (z) as of any Refunding Closing Date, of its
Refunding Note evidencing the repayment obligation of the Owner Trustee in
respect of such Note, all as provided herein and in the Transaction Documents,
and (ii) to provide for the assignment and pledge by the Owner Trustee to the
Indenture Trustee, and for the grant of the lien and encumbrance of a separate
Deed of Trust by Owner Trustee for the benefit of the Indenture Trustee, as
part of the Indenture Estate hereunder, among other things, of certain of the
Owner Trustee's estate, right, title and interest in and to the Undivided
Interest, the Lease, the Facility Agreements and the Purchase Documents and all
payments and other amounts received hereunder or thereunder in accordance with
the terms hereof, other than Excepted Payments, as security for the Owner
Trustee's obligations to the Indenture Trustee and the Holders hereunder, under
the Notes and under the Participation Agreement and for the benefit and
security of the Indenture Trustee and such Holders;
WHEREAS, all things have been done to make the Notes, when
executed, delivered and issued by the Owner Trustee and authenticated and
delivered by the Indenture Trustee hereunder, the valid obligations of the
Owner Trustee; and
WHEREAS, all things necessary to make this Indenture the
valid, binding and legal obligation of the Owner Trustee, for the uses and
purposes herein set forth, in accordance with its terms, have been done and
performed and have happened;
GRANTING CLAUSE
NOW, THEREFORE, THIS TRUST INDENTURE AND SECURITY AGREEMENT
WITNESSETH, that, to secure the prompt payment of the principal of and premium,
if any, and interest on, and all other amounts due with respect to, all Notes
from time to time Outstanding and the performance and observance by the Owner
Trustee of all of its respective agreements, covenants and provisions herein
and in the Notes contained for the benefit of the Holders and the Indenture
Trustee and for the uses and purposes and subject to the terms and provisions
hereof, and in consideration of the premises and of the covenants herein
contained, and of the acceptance of the Notes by the Holders thereof, and for
other good and valuable consideration, the receipt whereof is hereby
acknowledged, the Owner Trustee has granted, bargained, sold, assigned,
transferred, conveyed, pledged and confirmed, and does hereby grant, bargain,
sell, assign, transfer, convey, pledge and confirm, unto the Indenture Trustee
and its successors and assigns for the security and benefit of the Indenture
Trustee and
-2-
<PAGE> 8
the Holders from time to time of the Notes, a first priority security interest
in, and by separate Deed of Trust the Owner Trustee is concurrently granting for
the benefit of the Indenture Trustee a first priority trust deed lien on, all
the estate, right, title and interest of the Owner Trustee in, to and under the
following described property, documents, rights and privileges (which
collectively constitute the Indenture Estate), to wit:
1. The Undivided Interest, including, without limitation,
the Lessor's Share of all Components and Modifications now existing or which
hereafter may become part of the Undivided Interest and title to which shall
vest in the Lessor in accordance with the Lease;
2. The Lease, including, without limitation, all Basic
Rent, Supplemental Rent, payments relating to Stipulated Loss Value,
Termination Value, the Early Buy-Out Price, any other applicable purchase price
and all other payments of any kind thereunder payable to the Owner Trustee and
to exercise any election or option or make any decision or determination or
give any notice, consent, waiver or approval thereunder or in respect thereof,
as well as all the rights, powers and remedies on the part of the Owner
Trustee, whether acting under any such agreement or by statute or law or in
equity, or otherwise, arising out of any Event of Default;
3. All right, title and interest of the Owner Trustee in,
to and under (a) the Bill of Sale and each other Purchase Document and (b) the
Ground Lease and Easement and (c) the Assignment of Contracts, including,
without limitation, (i) all amounts of rent, insurance proceeds and
condemnation, requisition and other awards and payments of any kind for or with
respect to any part of the Indenture Estate and (ii) subject to the terms of
this Indenture, all rights of the Owner Trustee to exercise any election or
option or to make any decision or determination or to give or receive any
notice, consent, waiver or approval or to take any other action under or in
respect of any such document, as well as all the rights, powers and remedies on
the part of the Owner Trustee, whether arising under any document or by statute
or at law or equity or otherwise, arising out of any Event of Default;
4. All monies and securities deposited or required to be
deposited with the Indenture Trustee pursuant to any term of this Indenture or
the Lease and held or required to be held by the Indenture Trustee hereunder;
5. All rents (including Rent), issues, profits, products,
revenues and other income of all property from time to time subjected or
required to be subjected to the Lien of this Indenture, and all right, title
and interest of every nature whatsoever of the Owner Trustee in and to the same
and every part thereof;
-3-
<PAGE> 9
6. All other property of every kind and description, real,
personal and mixed, and interests therein now held or hereafter acquired by the
Owner Trustee pursuant to any term of any Granting Clause Document, whether or
not subjected to the Lien of this Indenture by an Indenture Supplement; and
7. All proceeds of the foregoing.
but excluding, however, from the Indenture Estate the Excepted Payments; and
subject, however, to the rights of the Lessee under the Lease.
Concurrently with the delivery of its request for
authentication of the Notes to be issued on the Closing Date, the Owner Trustee
will deliver to the Indenture Trustee the original executed counterpart of the
Lease, marked "Original" as provided in Section 21(e) of the Lease, together
with executed copies of each Purchase Document.
HABENDUM CLAUSE
TO HAVE AND TO HOLD all and singular the aforesaid property
unto the Indenture Trustee, its respective successors and assigns, in trust for
the benefit and security of the Indenture Trustee and the holders from time to
time of the Notes, without any priority of any one Note above any other, and
for the uses and purposes and subject to the terms and provisions set forth in
this Indenture.
It is expressly agreed that anything herein contained to the
contrary notwithstanding, the Owner Trustee shall remain liable under each
Granting Clause Document to perform all of the obligations assumed by it
thereunder all in accordance with and pursuant to the terms and provisions
thereof, and neither the Indenture Trustee nor the holder of any Note or Notes
shall have any obligation or liability under any Granting Clause Document
solely by reason of the assignments hereunder, nor shall any of the Indenture
Trustee or the Holders of the Notes be required or obligated in any manner to
perform or fulfill any obligations of the Owner Trustee under or pursuant to
any Granting Clause Document or, except as herein expressly provided, to make
any payment, or to make any inquiry as to the nature or sufficiency of any
payment received by them, or present or file any claim, or take any action to
collect or enforce the payment of any amounts which may have been assigned to
them or to which they may be entitled at any time or times.
Pursuant to the provisions of the Lease, the Lessee is
directed to make all payments of Rent (other than Ground Lease Rent) to either
(i) in the case of
-4-
<PAGE> 10
payments other than Excepted Payments, the Owner Trustee or as the Owner
Trustee may otherwise direct by notice in writing to the Lessee, or (ii) in the
case of Excepted Payments, the Person entitled to receive such payments, at
such address as such Person may direct by notice in writing to the Lessee. The
Owner Trustee agrees that, so long as any Notes shall be Outstanding hereunder,
all payments described in clause (i) above shall be directed to be made to the
Indenture Trustee and that if it should receive any such payments or any
proceeds for or with respect to the Indenture Estate, it will promptly forward
such payments to the Indenture Trustee or in accordance with the Indenture
Trustee's instructions.
The Owner Trustee does hereby warrant and represent that it
has not assigned or pledged, and hereby covenants that it will not assign or
pledge, so long as the assignment hereunder shall remain in effect, any of its
estate, right, title or interest hereby assigned, to anyone other than the
Indenture Trustee (it being understood that the foregoing shall not, subject to
the provisions hereof, limit the rights of the Owner Trustee to assign its
rights to its successor or assigns as contemplated by the Trust Agreement), and
that it will not, except as permitted by this Indenture or with respect to
Excepted Payments, accept any payment from the Lessee, enter into any agreement
amending or supplementing any Granting Clause Document, execute any waiver or
modification of, or consent under, the terms of any Granting Clause
Document.
Notwithstanding the Granting Clause or any of the preceding
paragraphs, there are hereby excluded from the foregoing sale, transfer,
assignment, grant, pledge and security interest all Excepted Payments, and
nothing contained in the Granting Clause or any of the preceding paragraphs
shall impair in any respect the rights of the Owner Trustee under Sections
2.12, 4.02, 4.03, 5.07, 8.01 or 8.02 hereof.
IT IS HEREBY COVENANTED AND AGREED by and between the parties
hereto as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. INDENTURE DEFINITIONS. For all purposes of
this Indenture, each Indenture Supplement delivered hereunder and each Note
issued pursuant to the provisions hereof (and all Schedules, Exhibits,
Appendices or other attachments hereto or thereto), the following terms shall
have the following meanings (such definitions to be equally applicable to both
the singular and plural forms of the terms defined and, to the extent that such
definitions relate to agreements or
-5-
<PAGE> 11
instruments, such terms shall mean such agreements or instruments as the same
may from time to time be supplemented or amended or the terms thereof waived or
modified to the extent permitted by, and in accordance with, the terms thereof,
hereof and of the Transaction Documents):
Applicable Rate shall mean, with respect to any Notes issued
hereunder from time to time (including any Refunding Notes or Supplemental
Financing Notes), the interest rate per annum specified in such Note or Notes.
Debt shall mean any liability for borrowed money, or any
liability for the payment of money, or other liabilities evidenced or to be
evidenced by bonds, debentures, notes or other similar instruments.
Dollars and $ means the lawful currency of the United States
of America.
Early Buy-Out Notice shall mean a written notice of the Lessee
or Owner Trustee stating that the Notes Outstanding will be redeemed in respect
of the matters specified in clause (iii) of the first sentence of Section 2.13
hereof, which notice shall specify the Early Buy-Out Date and which shall,
whenever given, not be deemed effective for purposes hereof until the date
which is 45 days prior to the applicable Early Buy-Out Date.
Granting Clause Document shall mean each of the documents
referred to in clauses 2 and 3 of the Granting Clause of this Indenture.
Holder or holder shall mean any registered holder from time to
time of one or more Notes.
Indenture Default shall mean an Indenture Event of Default or
an event which, after the giving of notice or lapse of time, or both, would
become an Indenture Event of Default.
Indenture Estate shall have the meaning specified in the
Granting Clause hereof.
-6-
<PAGE> 12
Indenture Event of Default shall have the meaning specified in
Section 4.01 hereof.
Indenture Supplement shall mean a supplement to this
Indenture, in substantially the form of Exhibit A hereto, with such other or
alternate provisions as shall be consistent with or required by the terms
hereof (including Section 2.15 hereof), which shall, in appropriate cases,
describe items of property or equipment included in the property of the Owner
Trustee covered by and subject to the Lien of this Indenture or the Deed of
Trust, and which shall also, in appropriate cases, include a separate amendment
of the Deed of Trust in recordable form.
Independent Investment Banker shall mean an independent
investment banking institution of national standing appointed by the Lessee on
behalf of the Owner Trustee (or directly by the Owner Trustee if an Event of
Default has occurred and is continuing) and identified from time to time in a
writing delivered to the Indenture Trustee.
Interest Payment Date shall mean, (A) with respect to the
Notes issued on the Closing Date (including any Note issued in replacement of
or exchange for any thereof as herein provided), July 5, 1995 and each January
5 and July 5 occurring thereafter and (B) with respect to any other Notes
issued hereunder (including any Note issued in replacement of or exchange for
any thereof as herein provided), the date or dates specified in such Notes, and
ending, in each case, on the date all amounts payable in respect of such Note
have been paid in full; provided that if any such day is not a Business Day
then the relevant Interest Payment Date shall be the next succeeding Business
Day.
Make Whole Premium Amount shall mean, with respect to any Note
redeemed in accordance with Section 2.12 (in the event the Indenture Trustee
shall not have accelerated the Notes), Section 2.13 (ii), 2.13 (iii), 2.13 (iv)
or Section 2.14 prior to the Early Buy-Out Date, the excess, if any, of
(a) the net present value of the remaining scheduled principal and interest
payments in respect of the outstanding Notes discounted to the applicable
Redemption Date on a semiannual basis at the Treasury Rate over (b) the
aggregate principal amount of the Notes to be redeemed on such Redemption Date
plus any accrued and unpaid interest thereon, as calculated by the Independent
Investment Banker.
Majority in Interest of Holders of the Notes as of a
particular date of determination shall mean (A) subject to clause (B) of this
definition, the Holders of more than 66-2/3% in aggregate unpaid principal
amount of all Notes Outstanding as of such date or (B) to the extent that a
particular matter or question relates only to the
-7-
<PAGE> 13
Notes of a particular series, the Holders of more than 66-2/3% in aggregate
unpaid principal amount of all Notes Outstanding as of such date in respect of
such series; (excluding, in each case, any Notes held by (a) the Owner Trustee,
the Owner Participant or any Affiliate of any thereof, or any interests of the
Owner Participant therein by reason of subrogation pursuant to Section 4.02
hereof (unless, in any such case, all then Outstanding Notes or, in the case of
clause (B) hereof, Notes of the relevant series, shall be held by one or more
of the Owner Trustee, the Owner Participant or any Affiliate of any thereof) or
(b) the Lessee or any Affiliate thereof). In all cases in which a Majority in
Interest of Holders of the Notes is entitled to direct the Indenture Trustee to
take any action or otherwise advise the Indenture Trustee, each Holder of Notes
then Outstanding, or its duly authorized agent or attorney-in-fact, shall be
entitled to direct the Indenture Trustee only with respect to the aggregate
unpaid principal amount of Notes (or portion thereof) issued and Outstanding
which are registered in the name of such Holder and which are certified by such
Holder or its duly authorized agent or attorney-in-fact to be (i) held by it
for its own account and not pledged as collateral for any of its obligations or
held for the benefit of other Persons (including, without limitation, holders
of Pass Through Certificates) or (ii) pledged as collateral for one or more of
its obligations, or obligations with respect to which it is acting as trustee
under a related indenture or held for the benefit of other Persons (including,
without limitation, holders of Pass Through Certificates), but in respect of
which it has received a directive, satisfactory in form and substance to the
Indenture Trustee, given by the holder or holders of a proportionate interest
in the obligations secured by, or evidencing a beneficial interest in, such
Notes in accordance with the instrument governing such obligations. More than
one direction can be given by a registered Holder of Notes or its duly
authorized agent or attorney-in-fact pursuant to clause (ii) of the preceding
sentence, and such directions may be contradictory or inconsistent, so long as
each direction to take or refrain from taking the action specified therein or
otherwise advising the Indenture Trustee meets the requirements of said clause
(ii).
Note shall mean any Note issued hereunder (including the Notes
issued on the Closing Date, any Refunding Note or Supplemental Financing Note)
substantially in the form set forth in Section 2.01 hereof, as each such form
may be varied pursuant to the terms hereof or thereof, and such term includes
any such Note issued hereunder in exchange for or in replacement of any thereof
in accordance with the terms hereof.
Note Register shall have the meaning specified in Section 2.09
hereof.
Optional Redemption Notice shall mean a written notice given
by the Owner Trustee, at the direction of the Owner Participant, to the effect
that the Owner Trustee intends to exercise its rights under Section 2.12 hereof
to cause a redemption of all, but not less than all, of the Notes then
Outstanding, which notice shall, in order
-8-
<PAGE> 14
to be effective for purposes of such Section 2.12, specify the Indenture Event
of Default in respect of which such election is being made, if applicable, and
shall contain an irrevocable commitment of the Owner Trustee to take the
actions contemplated therein (including payment of the Redemption Price on the
applicable Redemption Date).
Principal Payment Date shall mean, with respect to each Note,
each date on which a regularly scheduled payment of principal is due thereunder
in accordance with the terms thereof.
Record Date shall mean, with respect to the interest or
principal payable on any Interest Payment Date or Principal Payment Date, as
the case may be, the last calendar day (whether or not a Business Day) which is
more than 15 calendar days prior to the related Interest Payment Date or
Principal Payment Date and, with respect to any other amount payable hereunder
or under the Notes, the last calendar day (whether or not a Business Day) which
is more than 15 days prior to the date such amount is to be received by the
Indenture Trustee as herein and in the Notes provided.
Recourse Amount shall have the meaning set forth in Section
2.05 hereof.
Redemption Date shall mean any date upon which the Notes are
to be redeemed pursuant to Sections 2.12, 2.13 or 2.14 hereof.
Redemption Price shall mean the price at which the Notes are
to be redeemed, determined as of the applicable Redemption Date, pursuant to
Sections 2.12, 2.13 or 2.14 hereof.
Refunding Date shall mean, in respect of each Refunding, the
date upon which such Refunding shall occur.
Regular Distribution Date shall have the meaning set forth in
the Pass Through Trust Agreement.
Treasury Rate shall mean, with respect to the determination of
a Make Whole Premium Amount, (i) in the case of a Note bearing a final stated
maturity of less than one year after the related Redemption Date, a rate of
interest per annum, determined by the Independent Investment Banker as of the
Treasury Rate Quote Date, equal to the average yield to maturity of, and
resulting from the bidding for (on a government bond equivalent basis) the
applicable United States Treasury Bill due the week in which such final stated
maturity occurs or (ii) in the case of all other Notes, a rate of interest per
annum determined by the Independent Investment Banker as of the Treasury Rate
Quote Date, to be equal to the average yield to maturity of, and resulting
-9-
<PAGE> 15
from the bidding for, the most comparable United States Treasury Notes, as
identified by the Independent Investment Banker, corresponding in maturity to
the Weighted Average Life to Maturity of the Notes then subject to the related
redemption (or, if there is no maturity corresponding to such Weighted Average
Life to Maturity, an interpolation, on a straight-line basis, between the yield
on (a) the United States Treasury Note with a constant maturity closest to and
greater than the Weighted Average Life to Maturity of such Notes and (b) the
United States Treasury Note with a constant maturity closest to and less than
such Weighted Average Life to Maturity); such yield to be determined by the
Independent Investment Banker by reference to the yield of the relevant United
States Treasury Notes (rounded, if necessary to the nearest 1/100 of 1% with
any figure of 1/200 of 1% or above rounded upward) as published in "Statistical
Release H.15 (519), Selected Interest Rates" (or any successor publication) by
the Board of Governors of the Federal Reserve System at or prior to 12:00 noon
New York time, on the Treasury Rate Quote Date.
Treasury Rate Quote Date shall mean, with respect to the
determination of a Redemption Price, the third Business Day preceding the
applicable Redemption Date.
Weighted Average Life to Maturity shall mean, with respect to
any indebtedness as at the time of determination thereof, the number of years
obtained by dividing the then Remaining Dollar Years of such indebtedness by
the then outstanding principal amount of such indebtedness. The term Remaining
Dollar Years of any indebtedness means for purposes of Section 2.15(b) the
amount obtained by (i) multiplying the amount of each then remaining sinking
fund, serial maturity or other required repayment of principal, including
repayment at final maturity, by the number of years (calculated to the nearest
1/12) which will elapse between the date of determination and the date of that
required repayment, and (ii) totalling all the products obtained in the
preceding clause (i).
-10-
<PAGE> 16
SECTION 1.02. OTHER DEFINITIONS. For all purposes of this
Indenture, capitalized terms used herein without other definition shall have
the meanings assigned thereto in Appendix A to the Participation Agreement. A
copy of such Appendix A is annexed hereto as Schedule 1 and hereby incorporated
herein by reference.
ARTICLE II
THE NOTES
SECTION 2.01. FORMS OF THE NOTES. The Notes shall each be
substantially in the form set forth below, with such changes that are not
inconsistent with the terms of this Indenture as the Lessee shall deem
desirable (and indicate in writing to the Owner Trustee and the Indenture
Trustee) and are consented to by the Owner Trustee (such consent not to be
unreasonably withheld) at or prior to the time such Note is issued (the
provisions set forth below constituting part of this Indenture).
-11-
<PAGE> 17
----------------
SECURED NOTE
ISSUED IN CONNECTION WITH LEASE OF AN UNDIVIDED INTEREST
IN THE NEWMONT GOLD ORE TREATMENT FACILITY TO
NEWMONT GOLD COMPANY
TRUST [NO. 1][NO. 2]
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND
MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN
VIOLATION OF THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT.
SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely as Owner
Trustee under Trust Agreement [No. 1][No. 2],
dated as of July 15, 1994,
with the Owner Participant
No. New York, New York
Original Principal Amount: Issue Date:
$ --------- --, 199-
Interest Rate: Maturity Date:
-----% ---------, --
SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION, not in its
individual capacity but solely as Owner Trustee (herein in such capacity called
the "Owner Trustee") under that certain Trust Agreement [No. 1][No. 2], dated
as of July 15, 1994, between the Owner Participant named therein and the Owner
Trustee, hereby promises to pay to __________ or its registered assigns, the
principal sum of $____________(________________ Dollars), such principal sum
to be repaid in installments having the principal amounts set forth in Annex A
hereto on the Principal Payment Dates therein indicated, together with interest
at a rate per annum equal to the rate specified above under the caption
"Interest Rate" on the unpaid principal amount hereof from time to time
outstanding from and including the date hereof to but not including the date
on which such principal amount is paid in full, payable in arrears on each
Interest Payment
-12-
<PAGE> 18
Date (as defined in the Indenture referred to below) and on the date of any
payment of principal hereof; provided, however, that, if any principal amount
in respect of this Note, or any interest in respect of the outstanding
principal amount hereunder, is paid on a date other than an Interest Payment
Date, interest at the rate hereinabove provided for shall continue to accrue on
the outstanding principal amount hereunder at such rate and shall be paid on
the date such principal or interest payment is paid; and provided, further,
however, the final payment of principal hereon on the stated maturity hereof
shall in any and all events equal the then outstanding principal balance
hereof.
Interest shall be calculated on the basis of a year of 360
days of twelve months of 30 days each.
All payments of principal and interest and other amounts to be
made to the Holder hereof by the Owner Trustee hereunder or under the Trust
Indenture and Security Agreement, dated as of July 15, 1994 (as such Trust
Indenture and Security Agreement may be amended or supplemented from time to
time, the "Indenture," the terms defined or incorporated therein and not
otherwise defined herein being used herein with the same meanings), between the
Owner Trustee and The First National Bank of Chicago, as indenture trustee
thereunder (the "Indenture Trustee"), shall be made only from the revenues and
proceeds of the Indenture Estate. Each Holder, by its acceptance of this Note,
agrees that it will look solely to the revenues and proceeds of the Indenture
Estate to the extent available for distribution to the Holder hereof as
provided in the Indenture and that none of the Owner Participant, the Lessee,
the Owner Trustee or the Indenture Trustee are personally liable to the Holder
hereof for any amounts payable under the Indenture or this Note or for any
liability under the Indenture, except, in the case of the Owner Trustee or the
Indenture Trustee, as expressly provided in the Indenture, this Note or in the
Participation Agreement.
Principal and interest and other amounts due hereunder or
under the Indenture shall be payable in Dollars in immediately available funds
prior to 1:00 P.M., New York City time, on the due date thereof to the
Indenture Trustee at the Indenture Trustee's Office. The Indenture Trustee
shall promptly remit (by wire transfer of immediately available funds) each
such amount to such account or accounts of the Holder hereof in whose name this
Note is registered at the close of business on the Record Date for payment of
such amount, at such financial institution or institutions and to such account
or accounts, within the continental United States, as the Holder hereof shall
have designated to the Indenture Trustee in writing and upon compliance with
the reasonable requirements of the Indenture Trustee. If any sum payable
hereunder or under the Indenture falls due on a day which is not a Business
Day, then such sum shall be payable on the next succeeding Business Day, and no
interest shall accrue for the intervening period.
-13-
<PAGE> 19
This Note is one of the Notes referred to in the Indenture
which have been or are to be issued by the Owner Trustee pursuant to the terms
of the Indenture. The Indenture Estate (including, but not limited to, a
separate Deed of Trust given for the benefit of the Indenture Trustee pursuant
to the Indenture), is held by the Indenture Trustee as security for the Notes.
Reference is hereby made to the Indenture and to the Participation Agreement
for a statement of the rights and obligations of the Holder of, and the nature
and extent of the security for, this Note and of the rights and obligations of
the Holders of, and the nature and extent of the security for, the other Notes
issued under the Indenture, as well as for a statement of the terms and
conditions of the trust created by the Indenture, to all of which terms and
conditions in the Indenture and in the Participation Agreement each Holder
hereof agrees by its acceptance of this Note.
There shall be maintained a Note Register for the purpose of
registering transfers and exchanges of Notes at the Indenture Trustee's Office
or at the office of any successor indenture trustee in the manner provided in
Section 2.09 of the Indenture. As provided in the Indenture, this Note may not
be exchanged for Notes of a different authorized denomination or in any other
circumstances except as provided in such Section 2.09, and this Note may only
be transferred in the circumstances contemplated by, and subject to the
conditions of, the provisions of the Indenture (including Sections 2.02B(a) and
2.09 thereof), to all of which conditions and provisions the Holder hereof, by
its acceptance of this Note, agrees to be bound.
Prior to the due presentment for, and due registration of
transfer of this Note as provided in Section 2.09 of the Indenture, the Owner
Trustee, the Indenture Trustee and the Lessee may and shall deem and treat the
person in whose name this Note is registered as the owner hereof for all
purposes hereof or otherwise in respect of the Indenture, whether or not this
Note or any amount payable hereunder is overdue, and none of the Owner Trustee,
the Lessee nor the Indenture Trustee shall be affected by notice to the
contrary.
This Note is subject to prepayment or redemption, in whole or
in part, only as permitted by Sections 2.12, 2.13 and 2.14 of the Indenture,
and the Holder hereof, by its acceptance of this Note, agrees to be bound by
such provisions. If at any time an Indenture Event of Default shall have
occurred and be continuing, this Note may be declared due and payable, all upon
the conditions, in the manner, subject to the restrictions and with the effect
provided in the Indenture, and the Holder hereof, by its acceptance of this
Note, agrees to be bound thereby. Neither this Note nor the Indenture is
cross-collateralized with, or may be cross-defaulted in respect of, any
security or indebtedness of the Lessee (except to the extent that an Event of
Default includes a cross-default to any other Financing Lease) or any security
or indebtedness of Shawmut
-14-
<PAGE> 20
Bank Connecticut, National Association, as trustee with respect to any property
other than the Indenture Estate.
The right of the Holder of this Note to institute action for
any remedy under the Indenture, including the enforcement of payment of any
amount due hereon, is subject to certain restrictions and conditions specified
in the Indenture, and the Holder hereof, by its acceptance of this Note, agrees
to be bound by such restrictions and conditions.
This Note shall not be secured by or be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose, unless
authenticated by the Indenture Trustee as evidenced by the manual signature of
one of its authorized officers on the certificate below.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Owner Trustee has caused this Note to
be executed in its corporate name by its office thereunto duly authorized, as
of the date below indicated.
SHAWMUT BANK CONNECTICUT,
NATIONAL ASSOCIATION,
not in its individual capacity, except
as otherwise specified herein, but
solely as Owner Trustee
Date: , 199 By
-------- -- - ------------------------
Title:
-15-
<PAGE> 21
[FORM OF INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Notes referred to in the within mentioned
Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
as Indenture Trustee
By
---------------------------------
Authorized Signatory
-16-
<PAGE> 22
Annex A
to
Secured Note
SCHEDULE OF PRINCIPAL PAYMENT DATES
AND PRINCIPAL PAYMENTS
<TABLE>
<CAPTION>
Percentage
Principal Payment of Original
Date (Interest Principal Principal
Payment Date Amount to Amount to
Occurring On) be Paid be Paid
- ----------------- ----------- -----------
<S> <C> <C>
</TABLE>
SECTION 2.02A. ISSUANCE OF NOTES ON THE CLOSING DATE. On the
Closing Date, the Owner Trustee shall issue and execute, and the Indenture
Trustee shall authenticate and deliver, to or at the direction of the Pass
Through Trustee, one or more Notes for original issuance in the aggregate
principal amount, having the maturity dates and bearing the interest rate and
having the other characteristics (including with respect to the repayment of
the aggregate principal amount thereof) as provided for in Indenture Supplement
No. 1 and the request for authentication delivered by the Owner Trustee to the
Indenture Trustee on the Closing Date. The Owner Trustee hereby authorizes the
Indenture Trustee, on behalf of the Owner Trustee, to receive the Loan Proceeds
from the sale to the Pass Through Trustee of such Notes. The Indenture Trustee
shall hold and apply the same as provided in Sections 2, 4 and 5 of the
Participation Agreement. Such Note or Notes shall be registered on the Note
Register in the name of the Pass Through Trustee and may not be transferred
except in accordance with the provisions hereof and of the Transaction
Documents.
SECTION 2.02B. REFUNDING; ERISA REPRESENTATION. (a) In
connection with any Refunding in accordance with and subject to the provisions
of Section 2.14 hereof, Section 14 of the Participation Agreement and the other
Transaction Documents, on the Refunding Date the Owner Trustee, at the
direction of the Lessee, shall issue and execute, and the Indenture Trustee
shall authenticate and
-17-
<PAGE> 23
deliver, one or more Refunding Notes for original issuance in an aggregate
principal amount at least equal to the principal amount outstanding in respect
of, and accrued interest on, the Notes to be redeemed as of the Refunding Date
and having the maturity dates, bearing the interest rates and having the other
characteristics (including with respect to the repayment of the aggregate
principal amount thereof) as provided for in the applicable Refunding Agreement
and other Transaction Documents. The Owner Trustee hereby authorizes the
Indenture Trustee, on behalf of the Owner Trustee, to receive the proceeds from
the sale of such Refunding and the Indenture Trustee shall hold and apply such
proceeds, and take such other actions with respect to such Refunding, as shall
be provided in the applicable Refunding Agreement and other Transaction
Documents. Such Notes shall be registered in the names of such entities as
shall be identified in or pursuant to the Refunding Agreement and,
notwithstanding any provision hereof, may not be transferred or accepted for
registration of transfer, in whole or in part, except in compliance with the
provisions of Section 2.09 hereof and of the Transaction Documents.
(b) Unless the Lessee otherwise agrees in writing, no ERISA
Plan, or any person treated as holding the assets of an ERISA Plan may acquire
or hold, beneficially or of record, any Note, or Supplemental Financing Note.
Unless otherwise agreed to in writing by the parties to the Participation
Agreement, the purchase or other acquisition by any Person of any Note, or
Supplemental Financing Note shall constitute a representation by such Person
and the beneficial owner of any thereof to the Lessee, the Owner Trustee, the
Owner Participant and the Indenture Trustee that such Person is not, and such
beneficial owner is not, an ERISA Plan and that such Person is not, and such
beneficial owner is not, purchasing or otherwise acquiring, and has not
purchased or otherwise acquired, such Note or Supplemental Financing Note with
assets of an ERISA Plan. Each Holder of a Note or Supplemental Financing Note,
by its acceptance thereof shall be deemed to have agreed to the foregoing.
SECTION 2.03. EXECUTION, DELIVERY AND AUTHENTICATION OF
NOTES; FORM AND MAXIMUM AGGREGATE PRINCIPAL AMOUNT; PAYMENT OF INTEREST AND
PRINCIPAL; NOTICE AND CALCULATION OF TREASURY RATE, MAKE WHOLE PREMIUM AMOUNT.
(a) The Notes shall be executed on behalf of the Owner Trustee by manual
signature by one of its Vice Presidents, Assistant Vice Presidents, Trust
Officers or Corporate Trust Officers. Notes bearing the signatures of
individuals who were at any time the proper officers of the Owner Trustee shall
bind the Owner Trustee, notwithstanding that such individuals or any of them
have ceased to hold such offices prior to the authentication and delivery of
such Notes. The Owner Trustee may from time to time execute and deliver Notes
to the Indenture Trustee for authentication upon original issue and such Notes
shall thereupon be authenticated and delivered by the Indenture Trustee upon
the written request of the Owner Trustee signed by an authorized officer. Each
Note issued
-18-
<PAGE> 24
hereunder shall be dated the date of its issuance. No Note shall be secured by
or be entitled to any benefit under this Indenture or be valid or obligatory
for any purpose unless there appears on such Note a certificate of
authentication in the form provided for herein executed by the Indenture
Trustee by the manual signature of one of its authorized offices, and such
certificate upon any Note shall be conclusive evidence, and the only evidence,
that such Note has been duly authenticated and delivered hereunder.
(b) All Notes shall be issued in fully registered form only,
without coupons, and shall be in the form provided for in Section 2.01 hereof.
All Notes shall be issued in denominations of $1,000,000 (of original principal
amount) or any amount in excess of $1,000,000 which is an integral multiple of
$1,000,000 (except as may be necessary to evidence the entire principal amount
of any Note issued and outstanding hereunder). The maximum aggregate principal
amount of Notes that may be issued hereunder, if so limited, is specified in
Indenture Supplement No. 1 or the request for authorization delivered by the
Owner Trustee with respect thereto.
(c) The principal amount of each Note issued hereunder shall
be due and payable, in installments or as otherwise provided in the form
thereof, on each Principal Payment Date in accordance with the terms thereof;
provided, however, that the final principal installment payment on each Note on
the stated maturity thereof shall in any and all events equal the then
outstanding balance thereof.
(d) Each Note issued hereunder shall bear interest at the
Applicable Rate for such Note on the unpaid principal amount thereof from time
to time outstanding from and including the date of issuance thereof to but not
including the date such principal amount is paid in full. Accrued interest on
each such Note shall be payable in arrears on each Interest Payment Date, on
the date such Note is paid in full and otherwise in accordance with the terms
hereof or thereof. Interest on the Notes shall be calculated on the basis of a
year of 360 days of twelve months of 30 days each.
(e) The Indenture Trustee shall, promptly after the date it
receives notice of an event that could give rise to a redemption of the Notes
and payment of Make Whole Premium Amount (and in any event within two Business
Days after such date), direct the Independent Investment Banker to (i)
determine, to the extent applicable, the Treasury Rate and the Make Whole
Premium Amount, and (ii) deliver written notice of such determinations to the
Owner Participant, the Owner Trustee and the Lessee immediately after each such
determination is made.
SECTION 2.04. TAXES; WITHHOLDING. The Indenture Trustee
shall exclude and withhold from each distribution of principal, premium, if
any, and interest and other amounts due hereunder or under the Notes any and
all withholding taxes
-19-
<PAGE> 25
applicable thereto under Applicable Law. The Indenture Trustee agrees (i) to
act as withholding agent in respect of such amounts and, in connection
therewith, whenever any present or future taxes or similar charges are required
to be withheld with respect to any amounts payable in respect of the Notes, to
withhold such amounts and timely pay the same to the appropriate authority in
the name of and on behalf of the Holders, (ii) that it will file any necessary
withholding tax returns or statements when due and (iii) that, as promptly as
possible after the payment of such amounts, it will deliver to each Holder
appropriate documentation showing the payment of such amounts, together with
such additional documentary evidence as such Holders may reasonably request
from time to time. The Indenture Trustee agrees to file any other information
reports with respect to the foregoing as it may be required to file under
United States law. For all purposes hereof and of the other Transaction
Documents, any amounts withheld by the Indenture Trustee from a payment due to
a Holder hereunder or under its Note pursuant to this Section 2.04 shall be
deemed to have been received by such Holder, and such Holder hall not be
entitled to receive any amount in respect of such withholding from any party to
the Transaction Documents.
SECTION 2.05. PAYMENTS FROM INDENTURE ESTATE ONLY. All
payments of principal and interest and other amounts to be made by the Owner
Trustee under the Notes and under this Indenture shall be made only from the
revenues and the proceeds of the Indenture Estate. Each Holder of a Note, by
its acceptance of such Note, agrees that it will look solely to the revenues
and proceeds of the Indenture Estate to the extent available for distribution
to it as herein provided and that none of the Owner Participant, the Lessee,
the Owner Trustee or the Indenture Trustee is personally liable to it for any
amounts payable under this Indenture or such Note or for any liability under
this Indenture, except, in the case of the Owner Trustee or the Indenture
Trustee, as expressly provided herein or therein or in the Participation
Agreement.
The Indenture Trustee and each Holder, by its acceptance of a
Note, hereby irrevocably agrees, (i) to the maximum extent permitted by law,
that, in any case in which any Person (other than the Lessee alone) is the
debtor or one of the debtors under the Federal Bankruptcy Act, each of the
Indenture Trustee and the Holders shall be deemed to have made a timely
election pursuant to Section 1111(b)(1)(A)(i) of the Federal Bankruptcy Act (or
any substantially comparable provision which is the successor thereto) as to
the Indenture Estate (which is acknowledged and agreed not to include Excepted
Payments) and (ii) if (A) the Trust Estate, the Owner Participant or the Trust
becomes a debtor subject to the reorganization provisions of the Federal
Bankruptcy Act or any successor provisions or any other applicable bankruptcy
or insolvency statutes, (B) pursuant to such provisions, the Owner Participant
is held to have recourse liability to the Indenture Trustee or the Holder of
any Note directly or indirectly on account of any amount
-20-
<PAGE> 26
payable under the Indenture, and (C) the Indenture Trustee actually receives
any payment which reflects any payment by the Owner Participant on account of
the matters referred to in clause (ii)(B) of this sentence, then the Indenture
Trustee shall promptly refund to the Owner Participant the Recourse Amount,
unless such Recourse Amount has theretofore been distributed to the Holders or
otherwise applied as herein provided. For purposes of this Section 2.05,
"Recourse Amount" means the amount by which the portion of such payment by the
Owner Participant on account of the matters referred to in clause (ii)(B) of
the preceding sentence actually received by the Indenture Trustee exceeds the
amount which would have been received by the Indenture Trustee if the Owner
Participant had not become subject to the recourse liability referred to in
such clause (ii)(B).
SECTION 2.06. METHOD OF PAYMENT. Principal and interest and
other amounts due hereunder or under the Notes shall be payable in Dollars in
immediately available funds prior to 1:00 P.M., New York City time, on the due
date thereof, to the Indenture Trustee at the Indenture Trustee's Office. The
Indenture Trustee shall promptly remit (by wire transfer of immediately
available funds), prior to 3:00 p.m., New York City time, on the date such
amounts are received, all such amounts to such account or accounts of the
Holders in whose name the outstanding Notes are registered at the close of
business on the Record Date for payment, at such financial institution or
institutions and to such account or accounts as such Holders shall have
designated to the Indenture Trustee in writing; provided that if the payment is
received by the Indenture Trustee after 2:00 P.M., New York City time, the
Indenture Trustee shall make payment promptly, but not later than the next
Business Day following the due date thereof. All payments required to be made
to the Owner Trustee hereunder shall be made in immediately available funds to
the Owner Trustee at its address set forth in the Participation Agreement or
such other address as the Owner Trustee may advise the Indenture Trustee in
writing. All such payments to the Owner Trustee shall be remitted by the
Indenture Trustee prior to 3:00 p.m., New York City time, on the date the
corresponding payment is received by the Indenture Trustee; provided that if
the payment is received by the Indenture Trustee after 2:00 p.m., New York City
time, the Indenture Trustee shall make payment promptly, but not later than the
next Business Day following the date such funds are received. If any sum
payable hereunder or under a Note falls due on a day which is not a Business
Day, then such sum shall be payable on the next succeeding Business Day, and no
interest shall accrue for the intervening period. Prior to the due presentment
for, and due registration of transfer of any Note as provided in Section 2.09
hereof, the Owner Trustee, the Lessee and the Indenture Trustee may and shall
deem and treat the person in whose name any Note is registered on the Note
Register as the absolute owner and Holder of such Note for the purpose of
receiving payment of all amounts payable with respect to such Note and for all
other purposes hereunder and otherwise in respect hereof, whether or not such
Note or any
-21-
<PAGE> 27
amount payable thereunder is overdue, and none of the Owner Trustee, the
Indenture Trustee nor the Lessee shall be affected by any notice to the
contrary.
SECTION 2.07. APPLICATION OF PAYMENTS. Each payment of
principal and interest or other amounts due on or in respect of each Note shall
be applied, first, to the payment of interest on such Note due and payable to
the date of such payment, as in such Note provided, second, to the payment of
the principal of such Note then due, and third, to the payment of premium, if
any, due in respect of such Note.
SECTION 2.08. TERMINATION OF INTEREST IN INDENTURE ESTATE. A
Holder of a Note shall not, as such, have any further interest in, or other
right with respect to, the Indenture Estate when and if the principal amount of
and premium, if any, and interest on and other amounts due under all Notes held
by such Holder and all other sums payable to such Holder hereunder and under
the Participation Agreement shall have been paid in full.
SECTION 2.09. REGISTRATION, TRANSFER AND EXCHANGE OF NOTES.
The Indenture Trustee agrees with the Owner Trustee that the Indenture Trustee
shall keep a register (herein sometimes referred to as the Note Register) in
which provisions shall be made for the registration of Notes and the
registration of transfers of Notes. The Note Register shall be kept at the
Indenture Trustee's Office, and the Indenture Trustee is hereby appointed Note
Registrar for the purpose of registering Notes and transfers of Notes as
provided herein. The Note Register shall be maintained in accordance with the
requirements of Section 163(f) of the Code and any successor provision thereto.
Upon surrender for registration of transfer of any Note at the Indenture
Trustee's Office, the Owner Trustee shall, to the extent such transfer has been
effected in accordance with the terms and provisions hereof and of the
Transaction Documents, execute and deliver in the name of the transferee or
transferees designated by the transferor in writing, one or more new Notes of
the same series and of a like aggregate principal amount bearing interest at
the same rate for such series of Notes being transferred. Each new Note
issued upon surrender of any Note for transfer or exchange shall be, unless
otherwise provided in the Indenture Supplement related to such Note, in the
aggregate outstanding principal amount of the Note being transferred or
exchanged and in an original principal amount of $1,000,000 or any amount in
excess of $1,000,000 which is an integral multiple of $1,000,000 (except as may
be necessary to evidence the entire principal amount of any Note issued and
outstanding hereunder) and dated the date to which interest shall have been
paid with respect to such surrendered Note or, if no such interest shall have
been paid, the date of original issuance of such surrendered Note. Subject to
the provisions hereof, whenever any Notes are so surrendered for exchange, the
Owner Trustee shall execute and the Indenture Trustee shall authenticate and
deliver, the Notes which the Holder making the
-22-
<PAGE> 28
exchange is entitled to receive. All Notes issued upon any registration of
transfer or exchange of Notes shall be the valid obligations of the Owner
Trustee evidencing the same respective obligations, and entitled to the same
security and benefits under this Indenture, as the Notes surrendered upon such
registration of transfer or exchange.
In addition to the foregoing, every Note presented or
surrendered for registration of transfer or exchange in accordance with the
terms hereof shall be accompanied by a written representation and agreement of
the proposed transferee thereof to and for the benefit of the Lessee, the Owner
Participant, the Owner Trustee and the Indenture Trustee (which representation
and agreement shall, except as expressly provided in clause (y) hereof, be in
form and substance satisfactory to each such Person), (x) to the effect that
such transfer will not violate Section 2.02B(b) hereof and that the
representation therein set forth is true and correct as of the date of transfer
or (y) in the event that the Lessee shall elect, to such effect with respect to
compliance with the applicable provisions of ERISA and the Code as are
reasonably acceptable to the Lessee and the Owner Participant.
The transferor shall make a notation on the old, and the
Indenture Trustee shall make a notation on the new, Note or Notes of the amount
of all payments of principal previously made on or in respect of the old Note
or Notes with respect to which such new Note or Notes are issued and the date
to which interest on such old Note or Notes has been paid. The Indenture
Trustee shall not be required to accept for transfer or exchange any
surrendered Note as above provided during the twenty-day period preceding the
due date of any payment on such Note, during the fifteen-day period next
preceding the mailing of a notice of redemption of any Notes of the same series
and maturity or after notice calling such Note or portion thereof for
redemption has been mailed. The Owner Trustee, the Indenture Trustee and the
Lessee may and shall deem and treat the Person in whose name each Note is
registered on the Note Register as the Holder thereof for all purposes
hereunder until due presentment for and due registration of transfer as
provided in this Section 2.09.
SECTION 2.10. MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If
each of the Indenture Trustee and the Owner Trustee shall receive to its
satisfaction evidence that any Note shall have become destroyed, lost or
stolen, or if any mutilated Note is surrendered to the Owner Trustee (with a
copy to the Indenture Trustee), the Owner Trustee shall, upon the written
request of the Holder of such Note and instruction of the Indenture Trustee,
and subject to the matters set forth in the next succeeding sentence, execute
and deliver in replacement thereof a new Note of the same series, payable to
the same Person in the same principal amount, dated the date of such Note and
designated as issued under this Indenture. No Note shall be executed and
delivered under this Section 2.10 (i) if the Owner Trustee or the Indenture
Trustee shall have
-23-
<PAGE> 29
notice that the Note in respect of which the same is being replaced has been
acquired by a bona fide purchaser or (ii) unless the Holder of such Note shall
furnish to the Lessee, the Owner Trustee and the Indenture Trustee such
security or indemnity as may be required by each of them to save the Lessee,
the Owner Trustee and the Indenture Trustee harmless in consequence thereof,
together with evidence satisfactory to the Lessee, the Owner Trustee and the
Indenture Trustee of the destruction, loss, mutilation or theft of such Note
and the ownership thereof. Any Note executed and delivered pursuant to this
Section 2.10 shall constitute conclusive evidence of the Owner Trustee's
obligations in respect thereof, as if originally issued, whether or not the
lost, stolen or destroyed Note shall at any time be found.
SECTION 2.11. PAYMENT OF EXPENSES ON TRANSFER. Upon the
issuance of a new Note or Notes pursuant to Section 2.09 or 2.10 hereof, the
Lessee, the Owner Trustee and/or the Indenture Trustee shall require from the
party requesting such new Note or Notes payment of a sum sufficient to
reimburse the Owner Trustee and/or the Indenture Trustee for, or to provide
funds for, the payment of any tax or other governmental charge in connection
therewith or any charges and expenses connected with such tax or other
governmental charge paid or payable in connection therewith, and such issuance
of a new Note or Notes shall otherwise be without cost to the Person or Persons
requesting or receiving the same.
SECTION 2.12. OPTIONAL REDEMPTION UPON EVENT OF DEFAULT. If
an Indenture Event of Default which is also a Event of Default shall have
occurred and be continuing, the Owner Trustee may elect to cause a redemption
of all, but not less than all, of the Notes then Outstanding by delivering to
the Indenture Trustee an Optional Redemption Notice. Upon receipt of such an
Optional Redemption Notice, the Indenture Trustee shall promptly give notice to
each Holder that all Notes Outstanding will be redeemed in whole on a date
selected by the Indenture Trustee (for purposes of a redemption pursuant to
this Section 2.12, the Redemption Date in respect thereof) and specified in
such notice, which shall be not less than 30 nor more than 45 days subsequent
to the date of receipt by the Indenture Trustee of the Owner Trustee's Optional
Redemption Notice; provided, however, that, so long as any Note is held by the
Pass Through Trustee, such date shall be the first Regular Distribution Date
subsequent to the date of receipt by the Holders of notice thereof which would
permit the Pass Through Trustee to give at least 20 days prior notice of the
corresponding distribution. The Redemption Price with respect to a redemption
under this Section 2.12 shall be equal to the aggregate principal amount of the
Notes Outstanding on the Redemption Date, together with interest accrued and
unpaid thereon to, but not including, the Redemption Date, without premium or
other prepayment penalty of any kind if the Indenture Trustee has given the
Owner Trustee notice of its intent to accelerate the Notes as required by
Section 4.03(a) but otherwise together with the
-24-
<PAGE> 30
Make Whole Premium Amount. The Owner Trustee shall pay or cause to be paid to
the Indenture Trustee the Redemption Price on or prior to the Redemption Date.
SECTION 2.13. MANDATORY REDEMPTION IN WHOLE. (a) All Notes
Outstanding shall be redeemed in full, on the dates hereinafter set forth or
referred to, in each of the following circumstances:
(i) In connection with the occurrence of an Event of Loss
with respect to the Facility if the Lessee is required to purchase the
Undivided Interest in accordance with Section 9(b) of the Lease;
(ii) In connection with the sale of the Undivided Interest on
the Termination Date as a result of Lessee's exercise of its early
termination rights contained in Section 15 of the Lease;
(iii) In connection with the Lessee's exercise of its Early
Purchase Option as provided in Section 14(1) of the Lease; and
(iv) In connection with Lessee's election to terminate the
Lease and purchase the Facility in accordance with the second sentence
of Section 8(h) of the Lease.
Following receipt by the Indenture Trustee of notice of the
applicable redemption in the manner prescribed by the Lease, the Indenture
Trustee shall promptly give notice to each Holder that all Notes Outstanding
hereunder will be redeemed on the applicable Redemption Date, determined as
provided in the second succeeding sentence. Failure by the Indenture Trustee
to receive any notice or to give to each Holder a notice shall not, if all
conditions to the relevant redemption set forth in the Transaction Documents
have otherwise been satisfied, render the Notes not subject to redemption, and
if all such other conditions have been satisfied, the Notes shall be redeemed
and the Indenture Trustee shall take the actions specified in Section 9.01
hereof on the applicable Redemption Date with respect to the release of the
Lien of this Indenture and the Deed of Trust. For purposes of any redemption
contemplated by this Section 2.13, (x) the Redemption Date shall be (I) in the
case of a redemption contemplated by clause (i), the Rent Payment Date on which
Stipulated Loss Value is payable under Section 9(b) of the Lease, (II) in the
case of a redemption contemplated by clause (ii), the Termination Date, (III)
in the case of a redemption due to the Lessee's exercise of its Early Purchase
Option, the Early Buy-Out Date or (IV) in the case of a redemption contemplated
by clause (iv), the date specified in such redemption notice and (y) the
Redemption Price shall be equal to the sum of (A) the aggregate principal
amount of the Notes outstanding on the applicable Redemption Date, together
-25-
<PAGE> 31
with interest accrued and unpaid thereon to, but not including, such Redemption
Date and (B) unless otherwise provided pursuant to the provisions of the Notes
outstanding, in the case of a redemption of the type contemplated by clause
(ii), (iii) or (iv) of the first sentence of this Section 2.13 which occurs
prior to the Early Buy-Out Date, the Make Whole Premium Amount determined as
at the applicable Redemption Date, but without premium or other prepayment
penalty of any kind in the case of a redemption of the type contemplated by
clause (i) of this Section 2.13 or any other redemption occurring on or after
the Early Buy-Out Date.
(b) Notwithstanding any provision hereof or of any other
Transaction Document to the contrary, in the event that for any reason the
Lease is not terminated in the manner contemplated by clauses (i), (iii) and
(iv) of paragraph (a) of this Section 2.13 on the date provided for in the
Lease, the Notes outstanding hereunder shall not be redeemed and no Indenture
Default or Indenture Event of Default shall occur as a result of such
redemption failing to occur.
SECTION 2.14. OPTIONAL REDEMPTION RELATING TO A REFUNDING.
(a) Subject to the provisions of paragraph (b) of this Section 2.14, all Notes
outstanding hereunder shall be redeemed, in whole but not in part, in
connection with a refunding contemplated by Section 14 of the Participation
Agreement. In accordance with the terms of the Refunding Agreement entered
into with respect to such a refinancing, the Indenture Trustee shall give
notice to each Holder that all Notes outstanding hereunder will be redeemed in
whole on the Refunding Date (for purposes of this Section 2.14, the Redemption
Date). The Redemption Price with respect to any redemption contemplated by
this Section 2.14 shall be in an amount equal to the aggregate principal amount
of the Notes outstanding hereunder on the Redemption Date, together with
interest accrued and unpaid thereon to, but not including, the applicable
Redemption Date, together with, unless such Redemption Date occurs on or after
the Early Buy-Out Date or unless otherwise provided in the form of Notes
outstanding, the Make Whole Premium Amount determined as of such Redemption
Date.
(b) Notwithstanding any provision hereof or of any other
Transaction Document to the contrary, in the event that a refunding transaction
of the type referred to in paragraph (a) of this Section 2.14 shall not for any
reason be consummated, the Notes outstanding hereunder shall not be redeemed,
and no Indenture Default or Indenture Event of Default shall occur as a result
of such a transaction not being so consummated.
SECTION 2.15. SUPPLEMENTAL FINANCING NOTES. (a) The Owner
Trustee and the Indenture Trustee shall, at the request of the Lessee, at any
time and from time to time, so long as no Indenture Event of Default that
constitutes an Event of
-26-
<PAGE> 32
Default has occurred and is continuing and subject to the conditions and
restrictions contained in this Indenture (including, without limitation, this
Section 2.15 and Section 8.01 hereof) and Section 8(g) of the Lease, except
that the provisions of clauses (1), (5) and (6) of the proviso to the fourth
sentence of such Section 8(g) may be waived by the Owner Trustee, execute and
deliver an Indenture Supplement providing for the creation of Supplemental
Financing Notes in connection with any Supplemental Financing of any
Modification and subjecting such Modification to the Lien of this Indenture and
of the Deed of Trust. Such Indenture Supplement shall set forth:
(1) the maximum principal amount of such Supplemental
Financing Notes;
(2) the text of such Supplemental Financing Notes (which,
except for the terms of payment thereof, shall be of substantially the
same tenor and effect as the text of the Notes then outstanding set
forth in this Indenture, with such changes as are consistent with and
permitted by this Indenture);
(3) the date of maturity of such Supplemental Financing Notes
(which shall not be later than the date of expiration of the Basic
Lease Term);
(4) the rate of interest on such Supplemental Financing Notes
and the date from which, and the date or dates on which, interest is
payable (which shall be Interest Payment Dates);
(5) the terms for the repayment of the principal amount of
such Supplemental Financing Notes (each regularly scheduled payment of
principal to occur on a Principal Payment Date or Interest Payment
Date);
(6) the terms, if any, as to prepayment or redemption of such
Supplemental Financing Notes at the option of the Owner Trustee, and
as to the premium, if any, payable on any redemption or prepayment of
such Supplemental Financing Notes;
(7) any other particulars necessary to describe and define
such Supplemental Financing Notes within the terms and limitations of
this Indenture and of all other Notes then outstanding; and
(8) any other terms and agreements in respect thereof
provided or permitted by this Indenture or necessary to specify the
terms and conditions on which such Supplemental Financing Notes shall
be issued.
-27-
<PAGE> 33
(b) Notwithstanding any other provision set forth in this
Section 2.15, no Supplemental Financing Notes may be issued without the consent
of a Majority in Interest of Holders of the Notes if (i) the Weighted Average
Life to Maturity of such Supplemental Financing Notes as of the date of
issuance of such Supplemental Financing Notes would be shorter than that of the
Notes then outstanding; (ii) such Supplemental Financing Notes would be issued
for an amount less than 100% of face amount thereof; (iii) such Supplemental
Financing Notes would benefit from collateral security, guarantees, indemnity
rights or other support or rights in excess of, or greater than, that securing,
supporting or applicable to the Notes then outstanding; or (iv) the conditions
set forth in paragraph (e) of this Section 2.15 have not been satisfied.
(c) At any time or from time to time after the execution and
delivery by the Owner Trustee of an Indenture Supplement creating Supplemental
Financing Notes in accordance with Section 2.15(a) hereof, the Owner Trustee
may execute and deliver to the Indenture Trustee such Supplemental Financing
Notes in an aggregate principal amount not exceeding the amount which is
permitted by such Indenture Supplement, and the Indenture Trustee shall
authenticate and deliver such Notes to or upon the written order of the Owner
Trustee after (i) compliance by the Owner Trustee with this Section 2.15, (ii)
receipt by the Indenture Trustee of an amount in cash equal to 100% of the
aggregate principal amount of such Supplemental Financing Notes and (iii)
receipt by the Indenture Trustee of the documents referred to below:
(1) A Lease Supplement, duly authorized, executed and
delivered by the Lessee and the Owner Trustee, providing for
adjustments in Rent, Stipulated Loss Value, Termination Value and (if
applicable) the Early Buy-Out Price under the Lease required to ensure
that payments of such amounts will be adequate to provide for payments
required hereunder and under the Notes, after giving effect to the
issuance of such Supplemental Financing Notes, together with such
instruments of conveyance, assignment and transfer, if any, reasonably
necessary to subject such Lease Supplement to the Lien of this
Indenture and of the Deed of Trust and to perfect such Lien subject to
no Liens other than Permitted Liens, and evidence as to the due
recording or filing of each thereof or of financing or similar
statements with respect thereto;
(2) such instruments of conveyance, assignment and transfer
(including, without limitation, contractors' waivers) duly executed
and delivered by the respective parties thereto, and such evidence of
the due filing thereof or of financing statements with respect
thereto, as may be required to convey to the Owner Trustee all
property included in such Modification and to subject such property to
the Lien of this Indenture and of the Deed of Trust, subject to no
Liens other than Permitted Liens;
-28-
<PAGE> 34
(3) originals or certified copies of all Governmental Actions
(if any) necessary for the due and valid issue of such Supplemental
Financing Notes, the due and valid authorization, execution, delivery
and performance by the Owner Trustee of the Indenture Supplement
relating thereto, and the due and valid authorization, execution,
delivery and performance by the Lessee and the Owner Trustee of the
Lease Supplement and the creation of the Lien referred to above, all
of which Governmental Actions shall have been duly obtained and shall
be in full force and effect;
(4) documentation, duly executed and delivered by the
respective parties thereto whereby the proposed Holder of the
Supplemental Financing Notes agrees to be bound by the terms of the
Transaction Documents; and
(5) legal opinions covering the matters referred to above and
opining as to the continued priority of the Lien of this Indenture and
of the Deed of Trust in and to the Indenture Estate, subject only to
Permitted Liens.
(d) The Indenture Trustee may release the cash proceeds
received by it from the issuance of Supplemental Financing Notes pursuant to
Section 2.15(c) hereof to provide funds to pay the costs of or to reimburse one
or more Persons for the payment of the Lessor's Share of the costs of the
relevant Modification, in an amount not exceeding the Fair Market Value of such
Modification, as certified to by an Officers' Certificate of the Lessee (which
Certificate shall be delivered to the Owner Trustee and the Indenture Trustee).
Such Officers' Certificate shall also state (w) that construction of such
Modification has been substantially completed in good and workmanlike manner in
conformity with good construction and engineering practice; (x) that such
construction has been completed in accordance with, and the operation of such
Modification as then constructed will not violate, any Applicable Law (other
than immaterial violations that, in any case or in the aggregate, (i) do not
prevent or interfere with the continued satisfactory operation of such
Modification or the Facility as a whole or (ii) will not result in the
imposition of penalties on the Owner Trustee, the Indenture Trustee or any
Holder of a Note); (y) that such Modification has been reasonably tested to
establish that such Modification is capable of performing its intended
function, and that such testing has not given the Lessee any reason to believe
that such Modification will fail to perform such intended function and (z) that
the installation and operation of such Modification will not adversely affect
in any material respect the value of the Facility or the Undivided Interest,
except insofar as any such adverse impact results from a Required Modification.
-29-
<PAGE> 35
(e) Prior to any issuance of Supplemental Financing Notes
hereunder, each of the conditions contained in Section 8(g) of the Lease (other
than clauses (1), (5) and (6) of the proviso to the fourth sentence thereof)
shall have been satisfied.
(f) Notwithstanding any provision hereof or in the
Transaction Documents to the contrary, if the conditions to issuance of
Supplemental Financing Notes hereinabove referred to in this Section 2.15 are
satisfied, no consent to such issuance shall be required from any Holder.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM
THE TRUST INDENTURE ESTATE
SECTION 3.01. APPLICATION OF CERTAIN PAYMENTS OF RENT.
Each amount of Interim Rent, Basic Rent and Supplemental Rent payable under
Section 3(b)(3) of the Lease with respect to overdue payments of Basic Rent
received by the Indenture Trustee from the Owner Trustee or the Lessee,
together with any amount received by the Indenture Trustee pursuant to Section
4.02 hereof, shall, except as otherwise provided in Section 3.02, 3.03 or
3.04, be distributed by the Indenture Trustee in the following order of
priority:
first, so much of such aggregate amount as shall be required
to pay in full the principal of, premium, if any, and interest then
due on all outstanding Notes shall be distributed to the Persons
entitled thereto; and
second, the balance, if any, of such aggregate amount
remaining thereafter shall be distributed to the Owner Trustee for
distribution by it pursuant to the Trust Agreement.
-30-
<PAGE> 36
SECTION 3.02. EVENT OF LOSS, TERMINATION, REFUNDING, PURCHASE
ON EARLY BUY-OUT DATE, ETC. (a) Except as otherwise provided in Section
3.03(a) or 3.04 hereof, but subject to the provisions of Section 9.01 hereof,
the aggregate amount of the payment or payments received by the Indenture
Trustee at any time on or prior to the applicable Redemption Date in respect of
a redemption contemplated by Sections 2.12 (prior to acceleration of the
Notes), 2.13 or 2.14 hereof shall be distributed or applied by the Indenture
Trustee in the following order of priority:
first, so much thereof as shall be required to pay the
Indenture Trustee and the Pass Through Trustee all amounts then due
and payable to each of them under the Transaction Documents shall be
applied to pay the Indenture Trustee and the Pass Through Trustee such
amounts;
second, so much thereof remaining as shall be required to pay
an amount equal to the Redemption Price in respect of a redemption to
occur on the applicable Redemption Date, shall be held by the
Indenture Trustee as part of the Indenture Estate until applied to the
redemption of the Notes on such Redemption Date as provided in Section
3.02(b); and
third, the balance thereof, if any, remaining thereafter shall
be distributed to the Owner Trustee for distribution by it pursuant to
the Trust Agreement.
(b) Except as otherwise provided in Sections 3.03(a) and 3.04
hereof, but subject to the provisions of Section 9.01 hereof, in the event the
Notes are redeemed in accordance with the provisions of Sections 2.12 (prior to
acceleration), 2.13 or 2.14
-31-
<PAGE> 37
hereof, the Indenture Trustee will apply on the applicable Redemption Date any
amounts then held by it in the Indenture Estate and received by it from or on
behalf of the Owner Trustee, including, without limitation, any amounts held by
the Indenture Trustee pursuant to clause second of paragraph (a) of Section
3.02 hereof in the following order of priority:
first, so much thereof as shall be required to pay the
Redemption Price of the outstanding Notes pursuant to Sections 2.13 or
2.14 hereof, as the case may be, on such Redemption Date shall be
applied to pay such amounts and to the redemption of the Notes on such
Redemption Date; and
second, the balance, if any, thereof remaining shall be
distributed to the Owner Trustee for distribution by it pursuant to
the Trust Agreement, provided that in the event of a redemption
referred to in Section 2.13(i) and 2.13(ii), the balance shall be paid
to the Lessee and Lessor, as the case may be, in accordance with
Sections 9(d) and 15, respectively, of the Lease.
SECTION 3.03. PAYMENT AFTER ACCELERATION OF THE NOTES. (a)
Except as otherwise provided in Sections 3.04(b), 3.04(c) and 3.04(d)
hereof, all payments received and amounts held or realized (including as a
consequence of the exercise of remedies) by the Indenture Trustee after the
Notes have been accelerated pursuant to Section 4.03(a) and so long as such
acceleration has not been rescinded as provided therein, as well as all
payments or amounts then held by the Indenture Trustee as part of the Indenture
Estate, shall be promptly distributed by the Indenture Trustee in the following
order of priority:
first, so much of such payments or amounts as shall be
required to reimburse the Indenture Trustee and the Pass Through
Trustee for any Tax, Claim, expense, charge or other loss (including,
without limitation, all amounts to be expended at the expense of, or
charged upon the tolls, rents, revenues, issues, products and profits
of, the property included in the Indenture Estate pursuant to Section
4.04(b) hereof) incurred by the Indenture Trustee and the Pass Through
Trustee (to the extent not previously reimbursed) (including, without
limitation, the expenses of any sale, taking or other proceeding,
reasonable attorneys' fees and expenses, court costs, and any other
expenditures incurred or expenditures or advances made by the
Indenture Trustee and the Pass Through Trustee in the protection,
exercise or enforcement of any right, power or remedy or any damages
sustained by the Indenture Trustee and the Pass Through Trustee,
liquidated or otherwise, upon such Indenture Event of Default) shall
be applied by the Indenture Trustee in reimbursement of such expenses;
-32-
<PAGE> 38
second, so much of such payments or amounts remaining as shall
be required to reimburse the then existing or prior Holders of the
Notes for payments made pursuant to Section 5.03 hereof (to the extent
not previously reimbursed) shall be distributed to the then existing
holders of the Notes ratably, without priority of one or any other, in
accordance with the amount of the payment or payments made by each
such then existing or prior Holder pursuant to said Section 5.03 and
applicable (in the case of each such then existing Holder of a Note)
as provided in said Section 5.03 to the Notes held by such existing
Holder at the time of distribution by the Indenture Trustee;
third, so much of such payments or amounts as shall be
required to pay in full all amounts then due in respect of principal
of, premium, if any, and interest on the Notes and all other amounts
then due and payable in respect of the Notes, shall be distributed to
the Holders of the Notes, and in case the aggregate amount so to be
distributed shall be insufficient to pay in full as aforesaid, then,
ratably, without priority of one over the other, in the proportion
that the aggregate unpaid principal amount of all Notes held by each
such Holder, and accrued but unpaid interest thereon to the date of
distribution, bears to the aggregate unpaid principal amount of all
Notes and accrued but unpaid interest thereon to the date of
distribution and all other amounts due hereunder and thereunder;
fourth, the balance, if any, of such payments or amounts
remaining thereafter shall be distributed to the Owner Trustee for
distribution by it in accordance with the provisions of the Trust
Agreement.
(b) Subject to Sections 3.02, 3.03(a) and 3.04(b),(c) and (d),
if, at the time of receipt by the Indenture Trustee of any installment
of Basic Rent (whether or not then overdue) or Supplemental Rent, there shall
have occurred and be continuing an Indenture Event of Default, then the
Indenture Trustee may retain such payments (to the extent the Indenture
Trustee is not then required to distribute such amount pursuant to clause
"first" of Section 3.01) as part of the Indenture Estate and not otherwise
distribute any such payments until the earliest of (i) the first Business Day
occurring more than 180 days following (a) in the case of an Indenture Event
of Default under Section 4.01(b), the date of the occurrence of such Indenture
Event of Default (after giving effect to the grace period set forth in Section
4.01(b)), and (b) in the case of any other Indenture Event of Default, the date
on which the Indenture Trustee shall have received notice of such Indenture
Event of Default (after giving effect to any applicable grace period), (ii)
such time as the Notes shall have been declared, or shall have become, due and
payable pursuant to Section 4.03, and (iii) such time as such Indenture Event
of Default shall no longer be continuing or have been cured or waived;
provided, however, that following an Indenture Event of Default and the lapse
of 180 days during which period the Indenture Trustee failed to accelerate the
Notes, such Indenture Event of Default shall not thereafter be the basis of a
retention of any Basic Rent or Supplemental Rent payment hereunder.
SECTION 3.04. CERTAIN PAYMENTS. (a) Except as otherwise
provided in this Indenture (including, Section 3.03(b)), any payments received
by the Indenture Trustee for which provision as to the application thereof is
made in the Lease, the Participation Agreement or any Transaction Document
shall be applied forthwith to the purpose for which such payment was made in
accordance with the terms of the Lease or the Participation Agreement,
as the case may be;
(b) The Indenture Trustee will distribute promptly upon
receipt any indemnity payment received by it from the Lessee in respect of the
Indenture Trustee in its individual capacity or any Holder of a Note either
pursuant to Section 13 of the Participation Agreement or as Supplemental Rent,
directly to the Person entitled thereto.
-33-
<PAGE> 39
(c) Notwithstanding anything to the contrary contained in
this Article III, (i) any property insurance proceeds received by the Indenture
Trustee in respect of Excepted Payments specified in clause (v) of the
definition of Excepted Payments shall be distributed promptly upon receipt by
the Indenture Trustee directly to the Person or Persons entitled thereto, and
(ii) any amounts received by the Indenture Trustee in respect of third party
bodily injury or property damage shall be promptly paid by the Indenture
Trustee to the Person or Persons entitled thereto.
(d) Notwithstanding any other provisions of this Indenture,
all Excepted Payments shall be paid over to the Person or Persons entitled
thereto.
SECTION 3.05. OTHER PAYMENTS. Any payments received by the
Indenture Trustee for which no provision as to the application thereof is made
in this Indenture shall be distributed by the Indenture Trustee (i) to the
extent received or realized at any time prior to the payment in full of all
obligations to the holders of the Notes secured by the Lien of this Indenture
or the Deed of Trust, first, in the manner as provided in clause "first" of
Section 3.03 hereof, second, in the manner provided in Section 3.01 hereof, and
(ii) to the extent received or realized at any time after payment in full of
all obligations to the holders of the Notes secured by the lien of this
Indenture or the Deed of Trust, in the following order of priority: first, in
the manner provided in clause "first" of Section 3.03 hereof, and second, in
the manner provided in clause "second" of Section 3.01 hereof.
SECTION 3.06. PAYMENTS TO OWNER TRUSTEE OR LESSEE. Any
amounts distributed hereunder by the Indenture Trustee to the Owner Trustee or
to the Lessee shall be paid to such Person by wire transfer of funds of the
type received by the Indenture Trustee at such office and to such account or
accounts of such entity or entities as shall be specified in the Participation
Agreement or otherwise designated by notice to the Indenture Trustee from time
to time.
SECTION 3.07. INVESTMENT OF AMOUNTS HELD BY INDENTURE
TRUSTEE. Any monies (including, without limitation, the proceeds of the
maturity, sale or other disposition of any Permitted Investment) held by the
Indenture Trustee hereunder as part of the Indenture Estate or otherwise as
contemplated by the Transaction Documents, until paid out by the Indenture
Trustee as herein or therein provided, shall be invested and reinvested in
Permitted Investments and sold, in any case at such prices, including accrued
interest or its equivalent, as are set forth in a written direction of the
Lessee (acting as agent of the Owner Trustee); provided that, if an Event of
Default shall have occurred and be continuing, such investment, reinvestment
and sale shall be directed by the Indenture Trustee, and such Permitted
Investments shall be held by the Indenture Trustee in trust as part of the
Indenture Estate until so sold; provided,
-34-
<PAGE> 40
further, that the Lessee shall, so long as no Event of Default shall have
occurred and be continuing, be entitled to receive from the Indenture Trustee,
and the Indenture Trustee shall promptly pay to the Lessee, any profit, income,
interest, dividend or gain realized upon maturity, sale or other disposition of
any Permitted Investment (except to the extent that any of the foregoing are
attributable to amounts which would be distributable to the Owner Trustee
hereunder or under the Lease, which amounts, together with any such profit,
income, interest, dividend or gain thereon, shall, subject to the next
succeeding sentence, be paid to the Owner Trustee). If the Notes have been
accelerated pursuant to Section 4.03(a) and such acceleration has not been
rescinded or if any Event of Default shall have occurred and be continuing, any
net income, profit, interest, dividend or gain realized upon maturity, sale or
other disposition of any Permitted Investment shall be held as part of the
Indenture Estate and shall be applied by the Indenture Trustee at the same
time, on the same conditions and in the same manner as the amounts in respect
of which such income, profit, interest, dividend or gain was realized are
required to be distributed in accordance with the provisions hereof or of the
Transaction Documents pursuant to which such amounts were required to be held.
The Indenture Trustee shall not be responsible for any losses on any
investments or sales of Permitted Investments made pursuant to the procedure
specified in this Section 3.07, except as a result of its wilful misconduct or
gross negligence.
ARTICLE IV
INDENTURE EVENTS OF DEFAULT;
REMEDIES OF INDENTURE TRUSTEE
SECTION 4.01. INDENTURE EVENTS OF DEFAULT. Indenture Event
of Default means any of the following events (whatever the reason for such
Indenture Event of Default and whether such event shall be voluntary or
involuntary or come about or be effected by operation of law or pursuant to or
in compliance with any judgment, decree or order of any court or any order,
rule or regulation of any administrative or governmental body):
(a) any Event of Default (other than in respect of any
Excepted Payment); or
(b) the failure of the Owner Trustee to pay any amount of
principal of, Make Whole Premium Amount, if any, or interest on any
Note within five Business Days after the same shall become due under
such Note; or
-35-
<PAGE> 41
(c) any representation or warranty made by the Owner
Participant in the Participation Agreement or by any Person
guaranteeing the obligations of the Owner Participant under the
Transaction Documents in any applicable guarantee or similar agreement
or the Owner Trustee herein or in the Participation Agreement shall
prove to have been false or incorrect in any material respect when any
such representation or warranty was made or given and shall remain a
misrepresentation or breach of warranty which is material and adverse
to the Holders of the Notes or to their interest or interests in the
Indenture Estate at the time at which such misrepresentation or breach
of warranty is brought or comes to the attention of the Indenture
Trustee; provided, however, that such misrepresentation or breach of
warranty shall not be an Indenture Event of Default unless all
consequences thereof shall not be cured within 60 calendar days after
written notice of such misrepresentation or breach of warranty is
given to the Owner Trustee and the Owner Participant by the Indenture
Trustee; or
(d) any failure by the Owner Trustee to observe or perform
any covenant or obligation of the Owner Trustee under Section 8(b) of
the Participation Agreement or any failure by the Owner Participant to
observe or perform any covenant or obligation of the Owner Participant
under Section 7(b) of the Participation Agreement which is to or for
the benefit of the Indenture Trustee or the Holder of any Note and is
not remedied within a period of 60 calendar days after notice thereof
has been given to the Owner Trustee and the Owner Participant by the
Indenture Trustee; provided that if such failure to comply cannot be
cured by the payment of money within such 60 day period, such failure
to comply shall not be an Indenture Event of Default hereunder so long
as the Owner Trustee or the Owner Participant, as the case may be, is
diligently pursuing the cure thereof (but such period may not exceed
360 days); or
(e) either the Trust Estate or the Owner Trustee with respect
thereto (and not in their individual capacities) shall (i) file, or
consent by answer or otherwise to the filing against it of a petition
for relief or reorganization or arrangement of any other petition in
bankruptcy, for liquidation or to take advantage of any bankruptcy or
insolvency law of any jurisdiction, (ii) make an assignment for the
benefit of its creditors, (iii) consent to the appointment of a
custodian, receiver, trustee or other officer with similar powers of
itself or of any substantial part of its property, or (iv) take
corporate or comparable action for the purpose of any of the
foregoing; or
-36-
<PAGE> 42
(f) a court or governmental authority of competent
jurisdiction shall enter an order appointing, without consent by the
Trust Estate or the Owner Trustee with respect thereto (and not in
their individual capacities), a custodian, receiver, trustee or other
officer with similar powers with respect to it or with respect to any
substantial part of its property, or constituting an order for relief
or approving a petition for relief or reorganization or any other
petition in bankruptcy or of liquidation or to take advantage of any
bankruptcy or insolvency law of any jurisdiction, or ordering the
dissolution, winding-up or liquidation of the Trust Estate or the
Owner Trustee with respect thereto (and not in their individual
capacities), or if any petition for any such relief shall be filed
against the Trust Estate or the Owner Trustee with respect thereto
(and not in their individual capacities) and such petition shall not
be dismissed within 90 calendar days or the order shall be unstayed
and remain in effect of a period of 90 calendar days.
SECTION 4.02. CERTAIN RIGHTS. In the event of the occurrence
of any Event of Default which relates to a default by the Lessee in the payment
of any Interim or Basic Rent due under the Lease, the Owner Trustee (upon
instructions of the Owner Participant) may, at any time prior to the date which
is 15 Business Days after written notice of such Event of Default has been
provided by the Indenture Trustee to the Owner Trustee and the Owner
Participant, without the consent or concurrence of the Indenture Trustee or any
Holder of Notes, pay, as provided in Section 2.06 hereof, for application in
accordance with Section 3.01 hereof a sum equal to the amount of all (but not
less than all) principal and interest as shall then be due and payable on the
Notes. In the event of the occurrence of any Event of Default which relates to
a default by the Lessee in any obligation under the Lease other than the
payment of Interim or Basic Rent, the Owner Trustee (upon instructions of the
Owner Participant) may, at any time prior to the date which is 15 Business Days
after written notice of such Event of Default has been provided by the
Indenture Trustee to the Owner Trustee and the Owner Participant, without the
consent or concurrence of the Indenture Trustee or any Holder of any Note,
exercise the Lessor's rights under Section 20 of the Lease to perform such
obligation on behalf of the Lessee. Solely for the purpose of determining
whether there exists an Indenture Event of Default for purposes of this
Indenture, (a) any timely payment by the Owner Trustee pursuant to, and in
compliance with, the first sentence of this Section 4.02 shall be deemed to
remedy any default by the Lessee in the payment of Interim Rent or Basic Rent
theretofore due and payable and to remedy any default by the Owner Trustee in
the payment of any amount due and payable under the Notes or hereunder in
respect of such Interim Rent or Basic Rent, and (b) any timely performance by
the Owner Trustee of any obligation of the Lessee under the Lease pursuant to,
and in compliance with, the second sentence of this Section 4.02 shall be
deemed to remedy (but solely for the purposes of this Indenture) any Lease
-37-
<PAGE> 43
Default to the same extent that like performance by the Lessee itself would
have remedied such Default (but the same shall not relieve the Lessee of its
duty to pay all Rent and perform all of its obligations pursuant to the Lease).
In such event the Owner Participant shall (to the extent of any such payments
made by the Owner Trustee) be subrogated to the rights of the Holders of the
Notes hereunder to receive the relevant payment of Interim Rent or Basic Rent
from the Indenture Trustee, and the payment of interest on account of such Rent
being overdue, and shall be entitled to receive such payment upon receipt
thereof by the Indenture Trustee; provided, that the Notes have not been
accelerated pursuant to Section 4.03. Notwithstanding the foregoing, this
Section 4.02 shall not apply with respect to any default in the payment of
Interim Rent or Basic Rent due under the Lease, if the Lessee itself shall have
theretofore failed to pay Interim Rent or Basic Rent in the manner required
under the Lease on (i) each of the three Rent Payment Dates immediately
preceding the date of such default or (ii) a total of six Rent Payment Dates.
The Indenture Trustee shall not exercise any remedies hereunder or under the
Lease during any period in which the Owner Trustee may cure a default by the
Lessee under the Lease as provided in this Section 4.02.
SECTION 4.03. REMEDIES. (a) If an Indenture Event of
Default shall have occurred and be continuing, then and in every such case
after the expiration of any applicable cure period provided for in Section 4.02
and, in the case of an Indenture Event of Default which is also an Event of
Default, upon the giving of ten (but not more than thirty) Business Days
prior notice thereof to the Owner Trustee and the Owner Participant stating
that it is the intention of the Indenture Trustee or the Majority in Interest
of the Holders of the Notes to terminate the Lease, commence an action to
dispossess the Lessee from its leasehold estate in the Undivided Interest or
exercise comparable remedies under the Lease, the Indenture Trustee may at any
time, and, upon instructions from the Majority in Interest of the Holders of
the Notes, will, by written notice or notices to the Owner Trustee and the
Owner Participant, declare all the Notes to be due and payable, whereupon the
unpaid principal of all Notes then outstanding, together with accrued but
unpaid interest thereon and all other amounts due thereunder and hereunder,
shall immediately become due and payable without presentment, demand, protest
or notice, all of which are hereby waived; provided that if prior to such
declaration the Owner Trustee delivers an Optional Redemption Notice exercising
its right to redeem the Notes under Section 2.12 of the Indenture, the
Indenture Trustee's right to declare all the Notes to be due and payable as
herein provided shall be suspended until the Redemption Date provided for in
Section 2.12. In the event that after an Event of Default the Owner Trustee
has declared the Lease to be in default and all amounts payable under Section
17(a)(3)(iii) of the Lease have been received by the Indenture Trustee, all of
the Notes will be deemed to have been declared due and payable. If at any time
after the principal of the Notes shall have been (or deemed to have been)
declared so due and payable, and before any judgment
-38-
<PAGE> 44
or decree for the payment of the money so due, or any thereof, shall be
entered, all overdue payments of interest upon the Notes and all other amounts
payable under the Notes (except the principal of the Notes which by such
declaration shall have become payable) shall have been duly paid, and every
other Indenture Event of Default with respect to any covenant or provision of
this Indenture shall have been cured, then and in every case such a Majority in
Interest of Holders of the Notes may (but shall not be obligated to), by
written instrument filed with the Indenture Trustee, rescind and annul the
Indenture Trustee's declaration and its consequences; but no such rescission or
annulment shall extend to or affect any subsequent Indenture Event of Default
or impair any right consequent thereon or require any holder to repay any
amount received as a result of such declaration.
(b) If the Notes have been accelerated as provided in Section
4.03(a) and so long as such acceleration is not rescinded, then and in every
such case the Indenture Trustee may, consistent with the provisions of this
Section 4.03(b), and without any requirement for prior notice to the Owner
Trustee or the Owner Participant of the Indenture Trustee's intent to exercise
any remedy provided for hereunder (except to the extent expressly provided for
herein), exercise any or all of the rights and powers and pursue any and all of
the remedies pursuant to this Article IV as well as those which are available
to a secured party under the Uniform Commercial Code, to a beneficiary under a
Deed of Trust or under other Applicable Law or in equity and, in the event
there then exists an Event of Default referred to in paragraph (a) of Section
4.01 hereof, any and all of the remedies pursuant to Section 17 of the Lease
and all of the rights and remedies of a lessor under Applicable Law and may
take possession of all or any part of the properties covered or intended to be
covered by the lien and security interest created hereby or pursuant hereto and
may, subject to the provisions of this Indenture, exclude the Owner Trustee and
all Persons claiming under any of them wholly or partly therefrom and sell,
assign or otherwise transfer all or any part thereof or interest therein, free
and clear of the interest of the Owner Trustee, at public or private auction,
with thirty calendar days' prior notice to the Owner Participant and the Owner
Trustee and at such prices and in such manner and on such terms as may be
deemed appropriate by the Indenture Trustee, or the Indenture Trustee may cause
foreclosure of the Deed of Trust by exercise of the power of sale or other
remedies available thereunder in accordance with Applicable Law. Without
limiting any of the foregoing, it is understood and agreed that the Indenture
Trustee may exercise any right of sale of the Undivided Interest available to
it, even though it shall not have taken possession of the Undivided Interest
and shall not have possession thereof at the time of such sale. The foregoing
provisions of this Section 4.03(b) are subject to the condition that, so long
as an Indenture Event of Default that has occurred and is continuing is an
Event of Default, the Indenture Trustee may not proceed to foreclose the Lien
of this Indenture or exercise any of its other remedies hereunder or under the
-39-
<PAGE> 45
Deed of Trust, unless it shall (to the extent it has not already done so),
declare the Lease to be in default (it being understood and agreed that the
delivery by the Indenture Trustee of a notice of termination to the Lessee
under such Section 17 of the Lease will be sufficient for such purpose) and
commence the exercise of remedies under Section 17 thereof to terminate the
Lease, dispossess the Lessee of its leasehold estate in the Undivided Interest
or take comparable action contemporaneously therewith (which actions have not
been stayed by any bankruptcy or similar proceedings with respect to the
Lessee).
(c) Any Holder of the Notes shall be entitled, at any sale
pursuant to Section 17(a) of the Lease or Section 4.03(b) hereof, to credit
against any purchase price bid at such sale by such Holder all or any part of
the unpaid obligations owing to such Holder and secured by the lien of this
Indenture.
SECTION 4.04. RETURN OF INDENTURE ESTATE. (a) After an
acceleration of the Notes as provided herein, at the request of the Indenture
Trustee the Owner Trustee shall promptly execute and deliver to the Indenture
Trustee such instruments of title and other documents as the Indenture Trustee
may deem necessary or advisable to enable the Indenture Trustee or an agent or
representative designated by the Indenture Trustee, at such time or times and
place or places as the Indenture Trustee may specify, to obtain possession of
all or any part of the property included in the Indenture Estate to which the
Indenture Trustee shall at the time be entitled hereunder. If the Owner
Trustee shall for any reason fail to execute and deliver such instruments and
documents after such request by the Indenture Trustee, the Indenture Trustee
may (i) obtain a judgment conferring on the Indenture Trustee the right to
immediate possession and requiring the Owner Trustee to execute and deliver
such instruments and documents to the Indenture Trustee, and (ii) to the extent
permitted by Applicable Law, pursue all or part of such property wherever such
property may be or is supposed to be and search for such property and take
possession of and remove such property. All expenses of obtaining such
judgment or of pursuing, searching for and taking such property shall, until
paid, be secured by the lien of this Indenture.
(b) Upon every such taking of possession, the Indenture
Trustee may, from time to time, at the expense of the Indenture Estate, make
all such expenditures for maintenance, insurance, repairs, replacements,
alterations, additions and improvements to and of the Indenture Estate, as it
may deem proper. In each such case, the Indenture Trustee shall have the right
to maintain, use, sell, transfer, operate, store, lease, control, manage or
dispose of the Indenture Estate and to carry on the business and to exercise
all rights and powers of the Owner Trustee relating to the Indenture Estate, as
the Indenture Trustee shall deem best, including the right to enter into any
and all such agreements with respect to the sale, transfer, maintenance,
insurance, use,
-40-
<PAGE> 46
operation, storage, leasing, control, management or disposition of the
Indenture Estate or any part thereof as the Indenture Trustee may determine;
and the Indenture Trustee shall be entitled to collect and receive directly all
tolls, rents (including Rent), revenues, issues, income, products and profits
of the Indenture Estate and every part thereof, except Excepted Payments,
without prejudice, however, to the right of the Indenture Trustee under any
provision of this Indenture to collect and receive all cash held by, or
required to be deposited with, the Indenture Trustee hereunder. Such tolls,
rents (including Rent), revenues, issues, income, products and profits shall be
applied to pay the expenses of the sale, transfer, maintenance, insurance, use,
operation, storage, leasing, control, management or disposition of the
Indenture Estate and of conducting the business thereof, and of all
maintenance, repairs, replacements, alterations, additions and improvements,
and to make all payments which the Indenture Trustee may be required or may
elect to make, if any, for taxes, assessments, insurance or other proper
charges upon the Indenture Estate or any part thereof (including the employment
of engineers and accountants to examine, inspect and make reports upon the
properties and books and records of the Owner Trustee), and all other payments
which the Indenture Trustee may be required or authorized to make under any
provision of this Indenture, as well as just and reasonable compensation for
the services of the Indenture Trustee, and of all persons properly engaged and
employed by the Indenture Trustee.
SECTION 4.05. REMEDIES CUMULATIVE. Each and every right,
power and remedy given to the Indenture Trustee specifically or otherwise in
this Indenture or in the Deed of Trust shall be cumulative and shall be in
addition to every other right, power and remedy herein given or now or
hereafter existing at law, in equity or by statute, and each and every right,
power and remedy whether specifically herein given or otherwise existing may be
exercised from time to time and as often and in such order as may be deemed
expedient by the Indenture Trustee, and the exercise or the beginning of the
exercise of any power or remedy shall not be construed to be a waiver of the
right to exercise at the same time or thereafter any other right, power or
remedy. No delay or omission by the Indenture Trustee in the exercise of any
right, remedy or power or in the pursuance of any remedy shall impair any such
right, power or remedy or be construed to be a waiver of any default on the
part of the Owner Trustee or the Lessee or to be an acquiescence therein.
SECTION 4.06. DISCONTINUANCE OF PROCEEDINGS. In case the
Indenture Trustee shall have instituted any proceeding to enforce any right,
power or remedy under this Indenture by foreclosure, exercise of the power of
sale under the Deed of Trust, entry or otherwise, and such proceedings shall
have been discontinued or abandoned for any reason or shall have been
determined adversely to the Indenture Trustee, then and in every such case the
Owner Trustee, the Indenture Trustee and the
-41-
<PAGE> 47
Lessee shall, subject to any determination in such proceedings, be restored to
their former positions and rights hereunder with respect to the Indenture
Estate, and all rights, remedies and powers of the Indenture Trustee shall
continue as if no such proceedings had been instituted.
SECTION 4.07. WAIVER OF PAST DEFAULTS. Upon written
instructions from a Majority in Interest of Holders of the Notes, the Indenture
Trustee shall waive any past default hereunder and its consequences and upon
any such waiver such default shall cease to exist and any Indenture Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this Indenture, but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon; provided, however, that the
Indenture Trustee shall not, in the absence of written instructions from the
holders of all Notes then outstanding, waive any default in the payment of the
principal of, premium, if any, or interest on, or other amounts due under, any
Notes then outstanding hereunder or in respect of a covenant or provision
hereof which, under Article IX hereof, cannot be modified or amended without
the consent of each Holder of a Note then outstanding.
ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE
AND RIGHTS OF OWNER TRUSTEE
SECTION 5.01. NOTICE OF INDENTURE EVENT OF DEFAULT; CERTAIN
DUTIES AND RESPONSIBILITIES. In the event the Indenture Trustee shall have
knowledge of an Indenture Event of Default or an Indenture Default, the
Indenture Trustee shall give prompt written notice thereof to the Owner
Participant, the Lessee, the Holders and the Owner Trustee. Subject to the
terms of this Indenture, the Indenture Trustee shall take such action, or
refrain from taking such action, with respect to such Indenture Event of
Default or Indenture Default (including with respect to the exercise of any
rights or remedies hereunder) as the Indenture Trustee shall be instructed in
writing by the Majority in Interest of Holders of the Notes. Subject to the
provisions of Section 5.03 hereof, if the Indenture Trustee shall not have
received instructions as above provided, the Indenture Trustee may, subject to
instructions thereafter received pursuant to the preceding provisions of this
Section 5.01, take such action, or refrain from taking any such action, but
shall be under no duty to take or refrain from taking any action, with respect
to such Indenture Default or Indenture Event of Default as it shall determine
to be advisable and in the best interests of the Holders of the Notes. In the
event the Indenture Trustee shall at any time exercise any remedies pursuant to
Section 17 of the Lease or shall elect to foreclose or otherwise enforce this
Indenture, the Indenture
-42-
<PAGE> 48
Trustee shall forthwith notify the Owner Participant, the Holders of the Notes,
the Owner Trustee and the Lessee. For all purposes of this Indenture, in the
absence of actual knowledge on the part of an officer in its Corporate Trust
Services Division, the Indenture Trustee shall not be deemed to have knowledge
of an Indenture Event of Default or an Indenture Default (except the failure of
the Lessee to pay any installment of Interim Rent or Basic Rent under the Lease
within one Business Day after the same shall become due, shall constitute
knowledge of an Indenture Event of Default for purposes of the first sentence
of this Section 5.01) unless notified in writing by the Lessee, the Owner
Trustee or one or more Holders of Notes.
SECTION 5.02. ACTION UPON INSTRUCTIONS: DELIVERY OF WRITTEN
INSTRUCTIONS TO OWNER TRUSTEE. (a) Subject to the terms of Sections 4.07,
5.03 and 5.07 hereof, upon the written instructions at any time and from time
to time of a Majority in Interest of Holders of the Notes, the Indenture
Trustee shall take such of the following actions as may be specified in such
instructions: (i) exercise such election or option, or make such decision or
determination, or give such notice, consent, waiver or approval or exercise
such right, remedy or power or take such other action hereunder or under any
other Transaction Document or in respect of any part or all of the Indenture
Estate as shall be specified in such instructions and permitted under the
Transaction Documents and Applicable Law; (ii) take such action with respect
to, or to preserve or protect, the Indenture Estate (including the discharge of
Liens) as shall be specified in such instructions and as are consistent with
this Indenture; and (iii) take such other action in respect of the subject
matter of this Indenture as is consistent with the terms hereof and the other
Transaction Documents.
(b) If any Event of Default shall have occurred and be
continuing and the Notes have been accelerated as provided herein, on request
of a Majority in Interest of Holders of the Notes, the Indenture Trustee shall,
subject to any representations, agreements or limitations herein expressly
stated, exercise such remedies under Section 17 of the Lease as shall be
specified in such request.
(c) The Indenture Trustee will execute and file or cause to
be filed such financing and continuation statements and such other documents
with respect to this Indenture, supplements hereto and the security interest
created hereunder or pursuant hereto in the Indenture Estate as may be
specified from time to time in written instructions of a Majority in Interest
of Holders of the Notes (which instructions may, by their terms, be operative
only at a future date and which shall be accompanied by the execution form of
such continuation statement so to be filed).
(d) Except during the continuance of an Indenture Event of
Default, (1) the Indenture Trustee undertakes to perform such duties as are
specifically set forth in
-43-
<PAGE> 49
this Indenture, and no implied covenants or obligations shall be read into this
Indenture against the Indenture Trustee; and (2) in the absence of bad faith on
its part, the Indenture Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Indenture Trustee and conforming to
the requirements of this Indenture; provided, that in the case of any such
certificates or opinions which by any provision hereof are specifically
required to be furnished to the Indenture Trustee, the Indenture Trustee shall
be under a duty to examine the same to determine whether or not they so conform
to the requirements of this Indenture. In the event that an Indenture Event of
Default has occurred and is continuing, the Indenture Trustee shall exercise
such of the rights and powers vested in it by this Indenture, and use the same
degree of care and skill in their exercise, as a prudent man would exercise or
use under the circumstances in the conduct of his own affairs. No provision of
this Indenture shall be construed to relieve the Indenture Trustee from
liability for its own grossly negligent action, its own grossly negligent
failure to act, or its own willful misconduct, except that (A) the foregoing
shall not be construed to limit the effect of the first sentence of this
paragraph (d) and (B) the Indenture Trustee shall not be liable for any error
of judgment made in good faith by any officer in its Corporate Trust Services
Division or any of its other officers customarily performing functions similar
to those persons who at the time shall be such officers, unless it shall be
established that the Indenture Trustee was negligent in ascertaining the
pertinent facts.
SECTION 5.03. INDEMNIFICATION. The Indenture Trustee shall
not be required to take any action or refrain from taking any action under
Section 5.01 (other than the first sentence thereof) or 5.02 or Article IV
hereof unless the Indenture Trustee shall have been indemnified against any
liability, cost or expense (including counsel fees) which may be incurred in
connection therewith. The Indenture Trustee shall not be under any obligation
to take any action under this Indenture and nothing in this Indenture contained
shall require the Indenture Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder or in the exercise of any of its rights or powers if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it. The
Indenture Trustee shall not be required to take any action under Section 5.01
(other than the first sentence thereof) or 5.02 or Article IV hereof, nor shall
any other provision of this Indenture be deemed to impose a duty on the
Indenture Trustee to take any action, if the Indenture Trustee shall have been
advised by counsel that such action is contrary to the terms hereof or of the
Transaction Documents, or is otherwise contrary to law.
SECTION 5.04. NO DUTIES EXCEPT AS SPECIFIED IN INDENTURE OR
INSTRUCTIONS AND MAINTENANCE OF PAYMENT ACCOUNT. The Indenture Trustee shall
not
-44-
<PAGE> 50
have any duty or obligation to use, operate, store, lease, control, manage,
sell, dispose of or otherwise deal with the Facility or any part of the
Facility, or to otherwise take or refrain from taking any action under, or in
connection with, this Indenture or any part of the Indenture Estate, except as
expressly provided by the terms of this Indenture or as expressly provided in
written instructions as provided in this Indenture; and no implied duties or
obligations shall be read into this Indenture against the Indenture Trustee.
First Chicago agrees that it will, in its individual capacity and at its own
cost and expense (and without any right of indemnity in respect of any such
cost or expense) promptly take such action as may be necessary to duly
discharge all liens and encumbrances on any part of the Indenture Estate which
result from claims against it in its individual capacity not related to the
Indenture Trustees' interest in the Indenture Estate or the administration of
the Indenture Estate or any other transaction pursuant to this Indenture or any
document included in the Indenture Estate.
SECTION 5.05. NO ACTION EXCEPT UNDER LEASE, INDENTURE OR
INSTRUCTIONS. The Indenture Trustee agrees that it will not use, operate,
store, lease, control, manage, sell, dispose of or otherwise deal with the
Facility or any other part of the Indenture Estate except (i) as required or
permitted by the terms of the Lease or (ii) in accordance with the powers
granted to, or the authority conferred upon, the Indenture Trustee pursuant to
this Indenture and in accordance with the express terms hereof.
SECTION 5.06. FURNISHING OF NOTICES. The Indenture Trustee
will furnish to each Holder of a Note, promptly upon receipt thereof, a
duplicate or copy of each report, notice, request, demand, instruction,
certificate, financial statement, opinion or other instrument furnished to the
Indenture Trustee hereunder, under any other Transaction Document or in
connection with the Indenture Estate, unless the Indenture Trustee has
reasonable cause to believe (based on the face of such document or otherwise)
that such document has already been so distributed.
SECTION 5.07. CERTAIN RIGHTS OF OWNER TRUSTEE.
Notwithstanding any other provisions of this Indenture, including the Granting
Clause hereof (except as expressly provided in paragraph (b) of this Section
5.07):
(a) at all times the Owner Trustee shall have the right,
together with the Indenture Trustee, to receive from the Lessee all
notices, certificates, opinions of counsel and other documents and all
information which any Person is permitted or required to give or
furnish to the Owner Trustee or the Lessor pursuant to any Transaction
Document and to inspect any of the properties of the Lessee as
permitted by Section 8(b) or 8(j) of the Lease:
-45-
<PAGE> 51
(b) at all times the Owner Trustee shall have the right to
perform all covenants and obligations on behalf of the Lessee pursuant
to Section 20 of the Lease (it being understood that such performance
will cure an Indenture Event of Default only to the extent set forth
in Section 4.02 hereof and that Interim Rent or Basic Rent cure
payments by the Owner Trustee shall be applied as provided in Article
III hereof for the payment of such rent);
(c) the Owner Trustee and the Owner Participant shall have
the exclusive right to make all decisions and take all actions
required to be made or taken by the Lessor with respect to the
adjustments contemplated in Section 3(e) and 3(f) of the Lease,
subject to compliance with Section 3(g) of the Lease;
(d) so long as the Notes have not been accelerated as
provided in Section 4.03(a), the Owner Trustee may exercise, to the
exclusion of the Indenture Trustee, all rights conferred on the Lessor
by Sections 5, 13, 14 and 15 of the Lease (other than with respect to
the receipt of funds payable by the Lessee in respect thereof);
(e) so long as no Indenture Event of Default (other than an
Indenture Event of Default which is also an Event of Default) shall
have occurred and be continuing, the Owner Trustee shall have the
right, as Lessor, but not to the exclusion of the Indenture Trustee to
enforce the performance of the covenants of the Lessee under the
Lease, to declare the Lease in default pursuant to Section 17 thereof
and to exercise the remedies of the Lessor pursuant to Section
17(a)(3)(iii) of the Lease;
(f) so long as no Indenture Event of Default (other than an
Indenture Event of Default which is also an Event of Default) shall
have occurred and be continuing, the Owner Trustee shall exercise all
rights, elections and options of the Lessor but not to the exclusion
of the Indenture Trustee to make any decision or determination and to
give any notice, consent or approval with respect to the Lease or any
Granting Clause Document; and
(g) at all times, the Owner Trustee shall have the right, to
the exclusion of the Indenture Trustee, to receive and enforce the
payment of Excepted Payments due and payable to it.
-46-
<PAGE> 52
ARTICLE VI
THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE
SECTION 6.01. COVENANTS OF OWNER TRUSTEE. The Owner Trustee
hereby covenants and agrees as follows:
(a) it will duly and punctually pay the principal of and
interest on and other amounts due under the Notes and hereunder in
accordance with the terms of the Notes and this Indenture;
(b) in the event an officer in the Department of the Owner
Trustee shall have actual knowledge of an Indenture Event of Default,
an Indenture Default or an Event of Loss, the Owner Trustee will give
prompt written notice of such Indenture Event of Default, Indenture
Default or Event of Loss to the Indenture Trustee, the Lessee and the
Owner Participant;
(c) the Owner Trustee will furnish to the Indenture Trustee,
promptly upon receipt thereof, duplicates or copies of all reports,
notices, requests, demands, certificates, financial statements and
other instruments furnished to the Owner Trustee under the Lease, to
the extent that the same shall not have been furnished to the
Indenture Trustee pursuant to the Lease;
(d) except with the consent of the Indenture Trustee or in
connection with any Refunding, and except as provided in Section 2.15
hereof or as is necessarily incidental to the administration of the
Trust Estate, it will not contract for, create, incur, assume or
suffer to exist any Debt on behalf of the Trust Estate, and will not
on behalf of the Trust Estate guarantee (directly or indirectly or by
an instrument having the effect of assuring another's payment or
performance of any obligation or capability of so doing, or
otherwise), endorse or otherwise be or become contingently liable,
directly or indirectly, in connection with the Debt of any other
Person;
(e) it will not, on behalf of the Trust Estate, enter into
any business or other activity other than the business of owning the
Undivided Interest, the leasing thereof to the Lessee and the carrying
out of the transactions contemplated hereby and by the Lease, the
Participation Agreement, and the Trust Agreement and the other
Transaction Documents; and
(f) it will execute and deliver Indenture Supplements and
related Uniform Commercial Code financing statements and fixture
filings (and cause
-47-
<PAGE> 53
the filing thereof) promptly upon it acquiring title to any
Modification, all of which Indenture Supplements and statements and
filings shall be in appropriate form to subject such Modification to
the Lien of this Indenture and the Deed of Trust.
(g) The Owner Trustee agrees to pay over to the Indenture
Trustee for distribution in accordance with Section 3.04(b) hereof any
and all amounts actually received by the Owner Trustee in respect of
indemnity amounts paid by the Lessee in respect of its obligations to
the Indenture Trustee in its individual capacity or the Holders
pursuant to Section 13 of the Participation Agreement.
SECTION 6.02. ACCEPTANCE OF TRUSTS AND DUTIES. The Indenture
Trustee accepts the duties hereby created and applicable to it and agrees to
perform the same but only upon the terms of this Indenture and agrees to
receive and disburse all monies constituting part of the Indenture Estate in
accordance with the terms hereof. The Owner Trustee and the Indenture Trustee
shall not be answerable or accountable under any circumstances, except (a) for
their own willful misconduct or gross negligence, (b) in the case of the
Indenture Trustee, as provided in Section 2.04 hereof or in the last sentence
of Section 5.04 hereof, or in respect of the first sentence of Section 5.01
hereof or Section 7.03(b) hereof, or (c) for liabilities that may result, in
the case of the Owner Trustee, from the inaccuracy of any representation or
warranty or breach of any covenant of Shawmut Bank Connecticut, National
Association made in its individual capacity in the Participation Agreement or
this Indenture or, in the case of the Indenture Trustee, from the inaccuracy of
any representation or warranty of the Indenture Trustee in the Participation
Agreement or any other document relating hereto. Neither the Owner Trustees
nor the Indenture Trustee shall be liable for any action or inaction of any
other one of such parties.
SECTION 6.03. ABSENCE OF DUTIES. In the case of the
Indenture Trustee, except in accordance with written instructions furnished
pursuant to Section 5.01 or 5.02 hereof, and except as provided in, and without
limiting the generality of, Sections 2.04, 2.15, 5.01, 5.02, 5.03, 5.04 and
5.06 hereof and, in case of the Owner Trustee, except as provided in Sections
2.15 and 6.01 hereof and in Section 8(b) of the Participation Agreement, the
Owner Trustee and the Indenture Trustee shall have no duty (i) to see to any
recording or filing of the Lease or this Indenture or any other document, or to
see to the maintenance of any such registration, recording or filing, (ii) to
see to any insurance on the Facility or to effect or maintain any such
insurance, (iii) to see to the payment or discharge of any lien or encumbrance
of any kind against any part of the Trust Estate or the Indenture Estate, (iv)
to confirm, verify or inquire into the failure to receive any financial
statements of the Lessee or (v) to inspect the Facility at any time or
ascertain or inquire as to the performance or observance of any of the
-48-
<PAGE> 54
Lessee's covenants under the Lease with respect to the Facility.
Notwithstanding any provision hereof or of any other Transaction Document,
neither the Owner Participant nor the Lessee shall have any duty or
responsibility under this Indenture, including, without limitation, any of the
duties referred to in clauses (i) through (v) of the preceding sentence.
SECTION 6.04. NO REPRESENTATIONS OR WARRANTIES AS TO FACILITY
OR DOCUMENTS. NEITHER THE INDENTURE TRUSTEE OR THE OWNER TRUSTEE MAKES OR
SHALL BE DEEMED TO HAVE MADE ANY REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, AS TO THE TITLE, VALUE, COMPLIANCE WITH SPECIFICATIONS, CONDITION,
DESIGN, QUALITY, DURABILITY, OPERATION, MERCHANTABILITY OR FITNESS FOR USE OR
PURPOSE OF THE FACILITY OR ANY COMPONENT THEREOF, AS TO ABSENCE OF LATENT OR
OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, AS TO THE ABSENCE OF ANY
INFRINGEMENT OF ANY PATENT, TRADEMARK, OR COPYRIGHT, AS TO THE ABSENCE OF
OBLIGATIONS BASED ON STRICT LIABILITY IN TORT, OR ANY OTHER REPRESENTATION OR
WARRANTY WITH RESPECT TO THE FACILITY OR ANY COMPONENT THEREOF WHATSOEVER,
except for the representations and warranties of the Owner Trustee or Shawmut
Bank Connecticut, National Association, contained in Section 8(b)(i) of the
Participation Agreement. Neither the Owner Trustee nor the Indenture Trustee
makes or shall be deemed to have made any representation or warranty as to the
validity, legality or enforceability of this Indenture, the Deed of Trust, the
Trust Agreement, the Participation Agreement, the Notes, the Lease or any
Purchase Document or as to the correctness of any statement contained in any
thereof, except for the representations and warranties of Shawmut Bank
Connecticut, National Association made in its individual capacities in this
Indenture or the Participation Agreement. Neither the Owner Participant nor
the Lessee makes, or shall be deemed to have made, any representation or
warranty hereunder whatsoever.
SECTION 6.05. NO SEGREGATION OF MONIES; NO INTEREST.
Subject to Sections 3.07 and 10.01 hereof, any monies paid to or retained by
the Indenture Trustee pursuant to any provision hereof and not then required to
be distributed to the Holders of the Notes, the Lessee or the Owner Trustee as
provided in Article III hereof need not be segregated in any manner except to
the extent required by law, and may be deposited under such general conditions
as may be prescribed by law, and the Indenture Trustee shall not be liable for
any interest thereon; provided, however, that any payments received or applied
hereunder by the Indenture Trustee shall be accounted for by the Indenture
Trustee so that any portion thereof paid or applied pursuant hereto shall be
identifiable as to the source thereof; and provided, further, however, that any
moneys held by the Indenture Trustee under Sections 3.07 or 10.01 hereof
(including
-49-
<PAGE> 55
the proceeds of Permitted Investments, in the case of Section 3.07 hereof)
shall be segregated and separately accounted for, held upon the trusts therein
set forth and otherwise applied as contemplated thereby.
SECTION 6.06. RELIANCE; AGENTS; ADVICE OF COUNSEL. Neither
the Owner Trustee or the Indenture Trustee shall incur any liability to anyone
in acting upon any signature, instrument, notice, resolution, request, consent,
order, certificate, report, opinion, bond or other document or paper believed
by it to be genuine and believed by it to be signed by the proper party or
parties. The Owner Trustee and the Indenture Trustee may accept a copy of a
resolution of the Board of Directors of any party to the Participation
Agreement, certified by the Secretary or an Assistant Secretary thereof as duly
adopted and in full force and effect, as conclusive evidence that such
resolution has been duly adopted and that the same is in full force and effect.
As to the aggregate unpaid principal amount of Notes outstanding as of any
date, the Owner Trustee may for all purposes hereof rely on a certificate
signed by any Vice President or other authorized corporate trust officer of the
Indenture Trustee. As to any fact or matter relating to the Lessee the manner
of ascertainment of which is not specifically described herein, the Owner
Trustee and the Indenture Trustee may for all purposes hereof rely on an
Officers' Certificate of the Lessee, as to such fact or matter, and such
Certificate shall constitute full protection to the Owner Trustee and the
Indenture Trustee for any action taken or omitted to be taken by them in good
faith in reliance thereon. The Indenture Trustee shall assume, and shall be
fully protected in assuming, that the Owner Trustee is authorized by the Trust
Agreement to enter into this Indenture and to take all action to be taken by
them pursuant to the provisions hereof, and shall not inquire into the
authorization of the Owner Trustee with respect thereto. In the administration
of the trust hereunder, the Owner Trustee and the Indenture Trustee each may
execute any of the trusts or powers hereof and perform its powers and duties
hereunder directly or through agents or attorneys and may, at the expense of
the Indenture Estate, consult with counsel, accountants and other skilled
persons to be selected and retained by them, and the Owner Trustee and the
Indenture Trustee shall not, except as otherwise expressly provided herein or
in the Participation Agreement, be liable for anything done, suffered or
omitted in good faith by them in accordance with the written advice or written
opinion of any such counsel, accountants or other skilled persons.
SECTION 6.07. CAPACITY IN WHICH ACTING. Each of the Owner
Trustee and the Indenture Trustee acts hereunder solely as trustees as provided
herein, and, in the case of the Owner Trustee, as provided in the Trust
Agreement, and not in their respective individual capacities, except as
otherwise specified herein or therein.
-50-
<PAGE> 56
SECTION 6.08. COMPENSATION. The Indenture Trustee shall be
entitled to reasonable compensation, including expenses and disbursements
(including reasonable attorneys' fees and expenses), for all services rendered
hereunder and shall have a priority claim on the Indenture Estate for the
payment of such compensation, to the extent that such compensation shall not be
paid by the Lessee, and shall have the right to use or apply any monies held by
it hereunder in the Indenture Estate toward such payments. The Indenture
Trustee agrees that it shall have no right against the Holders of the Notes or
the Owner Participant for any fee as compensation for its services as trustee
under this Indenture.
ARTICLE VII
SUCCESSOR TRUSTEES
SECTION 7.01. NOTICE OF SUCCESSOR OWNER TRUSTEE. In the case
of any appointment of a successor to the Owner Trustee pursuant to the Trust
Agreement or upon any merger, conversion, consolidation or sale of
substantially all of the corporate trust business of the Owner Trustee pursuant
to the Trust Agreement, the successor Owner Trustee shall give prompt written
notice thereof to the Lessee, the Indenture Trustee and to the Holders of all
Notes at the time Outstanding.
SECTION 7.02. RESIGNATION OF INDENTURE TRUSTEE; APPOINTMENT
OF SUCCESSOR. (a) The Indenture Trustee or any successor thereto may resign
at any time without cause by giving at least 30 calendar days' prior written
notice to the Lessee, the Owner Trustee, the Owner Participant and each Holder
of a Note, such resignation to be effective upon the acceptance of the
trusteeship by a successor Indenture Trustee. In addition, a Majority in
Interest of Holders of the Notes may, subject to the written approval of the
Lessee, at any time remove the Indenture Trustee without cause by an instrument
in writing delivered to the Lessee, the Owner Trustee, the Owner Participant,
and the Indenture Trustee, and the Owner Trustee shall promptly notify each
Holder of a Note thereof in writing, such removal to be effective upon the
acceptance of the trusteeship by a successor Indenture Trustee. In the case of
the resignation or removal of the Indenture Trustee, a Majority in Interest of
Holders of the Notes may, subject to the written approval of the Lessee,
appoint a successor Indenture Trustee by an instrument signed by such Holders.
If a successor Indenture Trustee shall not have been appointed within 30
calendar days after such notice of resignation or removal, the then current
Indenture Trustee, the Lessee or any Holder of a Note may apply to any court of
competent jurisdiction to appoint a successor Indenture Trustee to act until
such time, if any, as a successor shall have been appointed as above provided.
The successor Indenture Trustee so appointed by such court shall
-51-
<PAGE> 57
immediately and without further act be superseded by any successor Indenture
Trustee appointed as above provided within one year from the date of the
appointment by such court.
(b) Any successor Indenture Trustee, however appointed, shall
execute and deliver to the Owner Trustee, the Owner Participant, the Lessee and
the predecessor Indenture Trustee an instrument accepting such appointment, and
thereupon such successor Indenture Trustee, without further act, shall become
vested with all the estates, properties, rights, powers and duties of the
predecessor Indenture Trustee hereunder and in the trusts created hereunder
applicable to it with like effect as if originally named the Indenture Trustee
herein; but nevertheless upon the written request of such successor Indenture
Trustee, such predecessor Indenture Trustee shall execute and deliver to the
Owner Trustee, the Owner Participant, the Lessee and the successor Indenture
Trustee an instrument transferring to such successor Indenture Trustee upon the
trusts herein expressed applicable to it, all the estates, properties, rights
and powers of such predecessor Indenture Trustee, and such predecessor
Indenture Trustee shall duly assign, transfer, deliver and pay over to such
successor Indenture Trustee all monies or other property then held by such
predecessor Indenture Trustee hereunder.
(c) Any successor Indenture Trustee, however appointed, shall
be a bank or trust company organized and doing business under the laws of the
United States of America or of any state thereof and shall be authorized under
such laws to exercise corporate trust powers, and shall have its principal
place of business in the State of New York, the State of Illinois or the State
of Connecticut and have a combined capital and surplus of at least $100,000,000
(or have a combined capital and surplus in excess of $10,000,000 and its
obligations, whether now in existence or hereafter incurred, fully and
unconditionally guaranteed by a corporation organized and doing business under
the laws of the United States of America, any State or Territory thereof or of
the District of Columbia and having a combined capital and surplus of at least
$100,000,000), if there be such an institution willing, able and legally
qualified to perform the duties of the Indenture Trustee hereunder upon
reasonable or customary terms. If such corporation publishes reports of
conditions at least annually, pursuant to law or to the requirements of
Federal, State, Territorial or District of Columbia supervising or examining
authority, then for the purposes of this Section 8.02, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of conditions so published.
(d) Any corporation into which the Indenture Trustee may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Indenture
Trustee shall be a party, or any corporation to which substantially all of the
corporate trust business of the
-52-
<PAGE> 58
Indenture Trustee may be transferred, shall, subject to the terms of paragraph
(c) of this Section, be the Indenture Trustee under this Indenture without
further act.
(e) In case at any time the Indenture Trustee shall cease to
meet the criteria for a successor Indenture Trustee specified in paragraph (c)
above, the Indenture Trustee shall resign immediately in the manner and with
the effect specified herein.
SECTION 7.03. APPOINTMENT OF ADDITIONAL AND SEPARATE
INDENTURE TRUSTEES. (a) Whenever: (i) the Indenture Trustee shall deem it
necessary or prudent in order to conform to any law of any jurisdiction in
which all or any part of the Indenture Estate shall be situated or to make any
claim or bring any suit with respect to or in connection with the Indenture
Estate, this Indenture, the Notes or any of the transactions contemplated under
the other Transaction Documents, or (ii) the Indenture Trustee shall be advised
by counsel satisfactory to it that it is so necessary or prudent in the
interests of the Holders, or (iii) the Indenture Trustee and the Owner Trustee
shall have been requested to do so by a Majority in Interest of Holders of the
Notes, the Indenture Trustee and the Owner Trustee shall execute and deliver an
indenture supplemental hereto or such other instruments as may from time to
time be necessary or advisable either (1) to constitute one or more bank or
trust companies or one or more natural persons approved by the Indenture
Trustee as additional trustee or trustees of all or any part of the Indenture
Estate, or to act as separate trustee or trustees of all or any part of the
Indenture Estate, in each case with such rights, powers, duties and obligations
as may be provided in such supplemental indenture or other instruments as the
Indenture Trustee or a Majority in Interest of Holders of the Notes may deem
necessary or advisable, or (2) to clarify, add to or subtract from the rights,
powers, duties and obligations theretofore granted any such additional or
separate trustee, subject in each case to the remaining provisions of this
Section 7.03. If the Owner Trustee shall not have taken any action requested
of it under this Section 7.03(a) that is permitted or required by its terms
within 30 days after the receipt of a written request from the Indenture
Trustee so to do, or if the Notes have been accelerated as provided in Section
4.03(a), the Indenture Trustee may act under the foregoing provisions of this
Section 7.03(a) without the concurrence of the Owner Trustee; and the Owner
Trustee hereby appoints the Indenture Trustee its agent and attorney-in-fact to
act for it under the foregoing provisions of this Section 7.03(a) in either of
such contingencies, subject, however, to the remaining provisions of this
Section 7.03. The Indenture Trustee may, in such capacity, execute, deliver
and perform any such supplemental indenture, or any such instrument, as may be
required for the appointment of any such additional or separate trustee or for
the clarification of, addition to or subtraction from the rights, powers,
duties or obligations theretofore granted to any such additional or separate
trustee. In case any additional or separate trustee appointed under this
Section 7.03(a) shall die, become incapable of acting, resign or be removed,
all the assets, property,
-53-
<PAGE> 59
rights, powers, trusts, duties and obligations of such additional or separate
trustee shall revert to the Indenture Trustee until a successor additional or
separate trustee is appointed as provided in this Section 7.03(a).
(b) No additional or separate trustee shall be entitled to
exercise any of the rights, powers, duties and obligations conferred upon the
Indenture Trustee in respect of the custody, investment and payment of monies
and all monies received by any such additional or separate trustee from or
constituting part of the Indenture Estate or otherwise payable under any
Transaction Document to the Indenture Trustee shall be promptly paid over by it
to the Indenture Trustee. All other rights, powers, duties and obligations
conferred or imposed upon any additional or separate trustee shall be exercised
or performed by the Indenture Trustee except to the extent that applicable law
of any jurisdiction in which any particular act is to be performed renders the
Indenture Trustee incompetent or unqualified to perform such act, in which
event such rights, powers, duties and obligations (including the holding of
title to all or part of the Indenture Estate in any such jurisdiction) shall be
exercised and performed by such additional or separate trustee. No additional
or separate trustee shall take any discretionary action except on the
instructions of the Indenture Trustee or a Majority in Interest of Holders of
Notes. No trustee hereunder shall be personally liable by reason of any act or
omission of any other trustee hereunder, except that the Indenture Trustee
shall be liable for the consequences of its lack of reasonable care in
selecting any additional or separate trustee which is a natural person. Each
additional or separate trustee appointed pursuant to this Section 7.03 shall be
subject to, and shall have the benefit of, Articles IV through X hereof insofar
as they apply to the Indenture Trustee. The powers of any additional or
separate trustee appointed pursuant to this Section 7.03 shall not in any case
exceed those of the Indenture Trustee hereunder.
(c) If at any time the Indenture Trustee shall deem it no
longer necessary or prudent in order to conform to any such law or take any
such action or shall be advised by such counsel that it is no longer so
necessary or prudent in the interests of the Holders, or in the event that the
Indenture Trustee shall have been requested to do so in writing by a Majority
in Interest of Holders of Notes, the Indenture Trustee and the Owner Trustee
shall execute and deliver an indenture supplemental hereto and all other
instruments and agreements necessary or proper to remove any additional or
separate trustee. The Indenture Trustee may act on behalf of the Owner Trustee
under this Section 7.03(c) when and to the extent it could so act under Section
7.03(a).
-54-
<PAGE> 60
ARTICLE VIII
SUPPLEMENTS AND AMENDMENTS TO THIS INDENTURE AND
OTHER TRANSACTION DOCUMENTS
SECTION 8.01. AMENDMENTS, WAIVERS, ETC. OF TRANSACTION
DOCUMENTS (OTHER THAN THIS INDENTURE). (a) Subject to the provisions of
paragraph (b) of this Section 8.01 and Section 8.01A hereof, the respective
parties to the Participation Agreement, and the Granting Clause Documents, at
any time and from time to time may, without the consent of the Indenture
Trustee or of any Holder amend, waive or modify any of the provisions of those
agreements; provided that without the consent of a Majority in Interest of
Holders of the Notes no such amendment, waiver or modification shall amend or
modify the following Sections of the Lease: Section 16 and Section 17.
(b) Notwithstanding the provisions of paragraph (a) of this
Section 8.01 or any other provision of this Indenture or any other Transaction
Document to the contrary, no modification or amendment with respect to the
Participation Agreement or any Granting Clause Document, shall, without the
consent of the Holder of each outstanding Note affected thereby,
(1) modify or amend the Lease in such a way as to extend the
time of payment of Basic Rent, Supplemental Rent (other than Excepted
Payments), Stipulated Loss Value (or any other amounts payable upon
the occurrence of an Event of Loss), Termination Value, the Early
Buy-Out Price, or any other amounts payable under, or as provided in,
the Lease which would be required to be paid to the Holders of the
Notes pursuant to the terms hereof (including, without limitation, the
amount payable under Section 8(h) of the Lease); or reduce the amount
of any installment of Basic Rent or the amount of Supplemental Rent
payable pursuant to the Lease so that the sum of the same is less than
the payment of principal of, premium, if any, and interest on the
Notes, as the case may be, to be made from such installment of Basic
Rent or Supplemental Rent; or reduce the aggregate amount of
Stipulated Loss Value or Termination Value or amounts payable in
respect of the Early Buy-Out Price or any other amounts payable under,
or as provided in, the Lease upon the occurrence of an Event of Loss,
on the Termination Date on the Early Buy-Out Date or in respect of any
other termination of the Lease (including, without limitation, in
Section 8(h) of the Lease) so that the same is less, together with any
other amounts payable under, or as provided in, the Lease, than the
Redemption Price payable as at the applicable Redemption Date; or
-55-
<PAGE> 61
(2) modify or amend the Lease in such a way as to release the
Lessee from its obligations in respect of the payment of Basic Rent,
Supplemental Rent (other than Excepted Payments), Stipulated Loss
Value (and any other amounts payable upon the occurrence of an Event
of Loss), Termination Value, the Early Buy-Out Price or any other
amounts payable under, or as provided in, the Lease (including,
without limitation, in Section 8(h) of the Lease).
SECTION 8.01A. AMENDMENTS TO THIS INDENTURE WITH AND WITHOUT
CONSENT OF HOLDERS. Subject to Section 12(b) of the Participation Agreement,
with the written consent of the Holders of a Majority in Interest of Holders of
the Notes, the Owner Trustee and the Indenture Trustee may enter into such
Indenture Supplement to add any provisions to or to change or eliminate any
provisions of this Indenture or of any such Indenture Supplement or to modify
the rights of the Holders; provided, however, that, without the consent of each
Holder affected thereby, no amendment to this Indenture or any other
Transaction Document may:
(1) reduce the principal amount of any Note or the amount of
any premium, if any, or of any payment of principal or interest due
on, any Note or extend the time of payment of any amount owing or
payable in respect of such Note; or
(2) change the dates on which any principal, premium, if any,
or interest is due on any Note; or
(3) create any Lien on the Indenture Estate prior to or pari
passu with the Lien thereon under this Indenture except such as are
permitted or contemplated by this Indenture, or deprive any Holder of
the benefit of the Lien on the Indenture Estate created by this
Indenture; or
(4) reduce the percentage in principal amount of the Notes,
the consent of whose Holders is required for any such supplemental
agreement, or the consent of whose Holders is required for any waiver
of compliance with the provisions of this Indenture or of or in
respect of any Indenture Default or Indenture Event of Default or of
any receipt of payment; or
(5) make any change in this Section 8.01A.
SECTION 8.02. SUPPLEMENTAL INDENTURE WITHOUT CONSENT.
Subject to Section 12(b) of the Participation Agreement, without the consent of
any of the Holders of the Notes then outstanding but subject to the provisions
of Section 8.03
-56-
<PAGE> 62
hereof, the Indenture Trustee and the Owner Trustee may enter into any
indenture or indentures supplemental hereto for one or more of the following
purposes:
(a) (i) to evidence the appointment of a successor Owner
Trustee in accordance with the terms of the Trust Agreement, or (ii)
to evidence the appointment of a successor Indenture Trustee hereunder
if done pursuant to the provisions of Article VII hereof;
(b) to subject to the lien of this Indenture and the Deed of
Trust, Lessor's Share of Components or Modifications to the Facility,
which become part of the Facility;
(c) to make such modifications requested by the Owner Trustee
as are appropriate in the event more than one Person becomes an Owner
Participant pursuant to the terms of the Trust Agreement;
(d) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein or to make any other provisions with respect to matters arising
under this Indenture which shall not be inconsistent with the
provisions of this Indenture, provided that such action shall not
adversely affect the interests of the Holders of any of the Notes then
outstanding or the rights or obligations of the Lessee under the Lease
or the other Transaction Documents;
(e) to provide for the issuance of Supplemental Financing
Notes as contemplated by Section 2.15 hereof or of Refunding Notes; or
(f) to add to the rights of the Holders or the Indenture
Trustee.
SECTION 8.03. TRUSTEES AND REPRESENTATIVE PROTECTED. If, in
the opinion of the institution acting as Owner Trustee under the Trust
Agreement or the institution acting as Indenture Trustee hereunder, any
document required to be executed pursuant to the terms of Section 8.01 or 8.02
hereof adversely affects any right, duty, immunity or indemnity with respect to
such institution under this Indenture, the Lease or the other Transaction
Documents, such institution may in its discretion decline to execute such
document unless the Person or Persons requesting any related action shall
provide an indemnity that is reasonably satisfactory to such institution.
SECTION 8.04. DOCUMENTS MAILED TO HOLDER. Promptly after the
execution by the Owner Trustee or the Indenture Trustee of any document entered
into pursuant to Section 8.01 or 8.02 hereof, the Indenture Trustee shall mail,
by certified
-57-
<PAGE> 63
mail, postage prepaid, a conformed copy thereof to each Holder of a Note at its
address last known to the Indenture Trustee, but the failure of the Indenture
Trustee to mail such conformed copies shall not impair or affect the validity
of such document.
SECTION 8.05. FORM OF AMENDMENTS AND OTHER DOCUMENTS. It
shall not be necessary for any written request furnished to the Holders
pursuant to this Article VIII to specify the particular form of the proposed
documents to be executed, but it shall be sufficient if such request shall
indicate the substance thereof.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. TERMINATION OF INDENTURE. Upon payment in full
of the principal of and interest on and all other amounts due under all Notes,
the Indenture Trustee shall execute and deliver, to or as directed in writing
by the Owner Trustee or, in the case of a purchase by the Lessee of the
Undivided Interest following an Event of Loss or in the case of a purchase of
the Undivided Interest in accordance with Section 8(h) of the Lease, by the
Lessee, an appropriate instrument or instruments (in recordable form), in form
and substance satisfactory to the Owner Trustee or the Lessee, as the case may
be, releasing from the Lien of this Indenture and the assignment and pledge
hereunder and from the Lien of the Deed of Trust the Undivided Interest, the
Facility Agreements and the remainder of the Indenture Estate; provided,
however, that this Indenture and the trust created hereby shall earlier
terminate and this Indenture shall be of no further force or effect upon any
sale or other final disposition by the Indenture Trustee of all property that
is part of the Indenture Estate and the final distribution by the Indenture
Trustee of all monies or other property or proceeds constituting part of the
Indenture Estate in accordance with the terms hereof. Except as otherwise
provided above, this Indenture and the trusts created hereby shall continue in
full force and effect in accordance with the terms hereof. The parties intend
that this Indenture be exempt from registration under any applicable Probate
Code and similar laws.
SECTION 9.02. NO LEGAL TITLE TO INDENTURE ESTATE IN HOLDERS.
No Holder of a Note shall have legal title to any part of the Indenture Estate.
No transfer, by operation of law or otherwise, of any Note or other right,
title and interest of any Holder of a Note in and to the Indenture Estate or
hereunder shall operate to terminate this Indenture or entitle such Holder or
any successor or transferee of such Holder to an accounting or to the transfer
to it of legal title to any part of the Indenture Estate.
-58-
<PAGE> 64
SECTION 9.03. SALE OF UNDIVIDED INTEREST BY INDENTURE TRUSTEE
IS BINDING. Any sale or other conveyance of the Undivided Interest or any
other part of the Indenture Estate by the Indenture Trustee made pursuant to
the terms of this Indenture or of the Lease shall bind the Holders of the Notes
and shall be effective to transfer or convey all right, title and interest of
the Indenture Trustee, and such Holders in and to the Undivided Interest or any
other part of the Indenture Estate. No purchaser or other grantee shall be
required to inquire as to the authorization, necessity, expediency or
regularity of such sale or conveyance or as to the application of any sale or
other proceeds with respect thereto by the Indenture Trustee.
SECTION 9.04. INDENTURE FOR BENEFIT OF OWNER TRUSTEE,
INDENTURE TRUSTEE, OWNER PARTICIPANT, LESSEE AND HOLDERS. Nothing in this
Indenture, whether express or implied, shall be construed to give to any Person
other than the Owner Trustee, the Indenture Trustee, the Holders of the Notes,
the Owner Participant and the Lessee, any legal or equitable right, remedy or
claim under or in respect of this Indenture.
SECTION 9.05. NO ACTION CONTRARY TO LESSEE'S RIGHTS UNDER THE
LEASE. Notwithstanding any of the provisions of this Indenture or the Trust
Agreement to the contrary, neither the Indenture Trustee nor the Owner Trustee
will take any action contrary to the Lessee's rights under the Lease, including
the rights of the Lessee under Section 6 thereof, except in accordance with the
provisions of the Lease.
SECTION 9.06. NOTICES, ETC. (a) Unless otherwise expressly
specified or permitted by the terms hereof, all notices, requests, demands,
authorizations, directions, consents, waivers or documents provided or
permitted by this Indenture to be made, given, furnished or filed shall be made
in the manner provided for communications under the Participation Agreement
pursuant to Section 19 thereof.
(b) Any notice or communication to Holders shall be mailed by
first-class mail to the addresses for Holders shown on the Note Register kept
by the Registrar. Failure so to mail a notice or communication or any defect
in such notice or communication shall not affect its sufficiency with respect
to other Holders.
(c) If a notice or communication is mailed in the manner
provided above within the time prescribed, it shall be conclusively presumed to
have been duly given, whether or not the addressee receives it.
(d) The Indenture Trustee shall promptly furnish the Lessee
with a copy of any demand, notice or written communication received by the
Indenture Trustee hereunder from any Holder, the Owner Trustee or the Owner
Participant.
<PAGE> 65
SECTION 9.07. SEVERABILITY. Any provision of this Indenture
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 9.08. NO ORAL MODIFICATIONS OR CONTINUING WAIVERS.
Subject to Article VIII hereof, no terms or provisions of this Indenture or the
Notes may be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party or other person against whom
enforcement of the change, waiver, discharge or termination is sought, and any
waiver of the terms hereof or of any Note shall be effective only in the
specific purpose given.
SECTION 9.09. SUCCESSORS AND ASSIGNS. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
each of the parties hereto and the successors and permitted assigns of each,
all as herein provided. Any request, notice, direction, consent, waiver or
other instrument or action by any Holder of a Note shall bind the successors
and assigns of such Holder. This Indenture and the Indenture Estate shall not
be affected by any amendment or supplement to the Trust Agreement or by any
other action taken under or in respect of the Trust Agreement, except to the
extent that the same is expressly contemplated by and taken in accordance with
the Transaction Documents. Each Holder by its acceptance of a Note agrees to
be bound by this Indenture and all provisions of the Participation Agreement
and other Transaction Documents applicable to it.
SECTION 9.10. HEADINGS; REFERENCES TO SECTIONS, ETC. The
headings of the various Articles and Sections herein and in the table of
contents hereto are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof. All references herein to any
Section, Article, provision, Exhibit, Annex, Appendix or other attachment
shall, unless otherwise indicated, be deemed references to a Section, Article,
provisions, Exhibit, Annex, Appendix or other attachment hereof or hereto, and
all such Exhibits, Annexes, Appendices and other attachments are hereby
incorporated herein by reference with the same effect as if set forth herein in
their entirety.
SECTION 9.11. NORMAL COMMERCIAL RELATIONS. Anything
contained in this Indenture to the contrary notwithstanding, any of the parties
to the Participation Agreement or any bank or other affiliate of such parties
may conduct any banking or other financial transactions, and have banking or
other commercial relationships, with the Lessee fully to the same extent as if
this Indenture were not in effect, including
-60-
<PAGE> 66
SECTION 9.12. GOVERNING LAW: COUNTERPART FORM. THIS
INDENTURE SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF
LAWS. This Indenture may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.
-61-
<PAGE> 67
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the day and year below provided.
SHAWMUT BANK CONNECTICUT,
NATIONAL ASSOCIATION,
in its individual capacity and as
Owner Trustee under a Trust
Agreement [No. 1][No. 2] dated as
of July 15, 1994 with the Owner
Participant named therein
Witness: By
------------- ----------------------------------
Title:
Date: _______ __, 1994
-62-
<PAGE> 68
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity,
except as specified herein, but
solely as Indenture Trustee
hereunder
THE FIRST NATIONAL BANK OF CHICAGO
Witness: By
----------------- ----------------------------------
Title:
Date: ______ __, 1994
-63-
<PAGE> 69
STATE OF )
-------------------------): ss.
COUNTY OF ) ---------
-------
Personally appeared before me, the undersigned authority in
and for the said County and State, on this __ day of ______, 1994, within my
jurisdiction, the within named _______________ who acknowledged that he is the
_________________ of First Chicago a national banking association, as Indenture
Trustee under the above and foregoing instrument, and that for and on behalf of
said corporation, and as its act and deed in said capacity as Indenture Trustee
and its having been duly authorized to do so, he executed the above and
foregoing instrument after first having been duly authorized by said
corporation to do so.
--------------------------
My Commission Expires:
- ------------------------
<PAGE> 1
EXHIBIT 4.8
EXHIBIT H
to
PARTICIPATION AGREEMENT
=============================================================================
ASSIGNMENT OF CONTRACTS
Dated
September __, 1994
from
NEWMONT GOLD COMPANY,
Assignor
to
SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity, but solely as Owner Trustee under Trust
Agreement [No. 1][No. 2], dated as of July 15, 1994, with Philip Morris
Capital Corporation,
Assignee
=============================================================================
NEWMONT GOLD ORE TREATMENT FACILITY
Trust [No. 1][No. 2]
<PAGE> 2
THIS ASSIGNMENT OF CONTRACTS (the Assignment), dated September
, 1994, from NEWMONT GOLD COMPANY, a Delaware corporation, as assignor
(Assignor), to SHAWMUT BANK CONNECTICUT, NATIONAL ASSOCIATION, not in its
individual capacity, but solely as Owner Trustee under Trust Agreement
[No. 1][No. 2], dated as of July 15, 1994, with Philip Morris Capital
Corporation (the Trust Agreement), as assignee (Assignee). Capitalized terms
used herein and not otherwise defined herein shall have the meanings set forth
in Appendix A to the Participation Agreement, dated as of July 15, 1994 (the
Participation Agreement), among Philip Morris Capital Corporation, as Owner
Participant, The First National Bank of Chicago, as Pass Through Trustee and
as Indenture Trustee, Assignee and Assignor.
W I T N E S S E T H :
WHEREAS, Assignor has heretofore entered into (i) a Contract
for Engineering and Equipment Procurement Services, dated February 3, 1992,
between Assignor and Lurgi Chemie Metallurgie Industriebau GmbH (Lurgi), (ii) a
contract for Engineering, Procurement and Construction Management Services, Job
21777, dated December 23, 1991, between Assignor and Bechtel Corporation
(Bechtel), and (iii) an Oxygen Supply Agreement, dated September 1, 1992,
between Assignor and Praxair (Praxair), Inc. for the design and construction
of, and for the sale of items to be included as a part of, the Facility (each
such agreement, together with all amendments thereto and modifications thereof,
being referred to herein as the Contracts and each of Lurgi, Bechtel and
Praxair being referred to herein as the Contractors).
WHEREAS, Assignee intends to purchase an undivided interest in
the Facility, the percentage of which shall be equal to the Lessor's Share,
from Assignor as provided, and subject to the conditions contained, in the
Participation Agreement and Assignor is willing to assign to Assignee, as
security for the due and punctual payment of Rent and other obligations and
liabilities of the Assignor to the Assignee under or relating to the Lease and
any other Transaction Document (all such obligations being referred to herein
as Obligations), on the terms and conditions herein set forth, Assignor's
right, title and interest with respect to each Contract, to the extent of the
Lessor's Share.
WHEREAS, in consideration of the issuance, sale and delivery
on the Closing Date, by Assignee of the Note referred to in the Indenture, the
proceeds of which are to be used for the purpose of financing part of the cost
of Assignee's Undivided Interest, Assignee intends further to assign to the
Indenture Trustee the rights assigned to Assignee hereunder.
<PAGE> 3
NOW THEREFORE, in consideration of the premises and of other
good and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto agree as follows:
SECTION 1. Grant of Security Interests.
As security for the full and prompt payment and performance
when due of all of its Obligations, Assignor hereby assigns, conveys, transfers
and sets over unto Assignee, and hereby grants to the Assignee a continuing
security interest of first priority in, all of its right, title and interest
in, to and under each Contract, to the extent, but only to the extent, of the
Lessor's Share, including without limitation: (i) any right to purchase the
Facility and take title to the Facility, (ii) any amounts received or
receivable by Assignor in respect of any claims for damages in respect of, and
any warranties, guarantees or indemnities of any Contractor contained in, the
Contracts, (iii) any claims or rights of Assignor against any other
contractors, subcontractors, suppliers or materialmen for any part or portion
of the Facility, (iv) any and all rights of Assignor to compel performance of
any Contract, (v) any proceeds of settlements, judgments or awards in
connection with, and any claims, disputes, litigation or arbitration relating
to or arising out of, any Contract, and (vi) the right to demand, receive,
accept and retain all property, services, tests, inspection rights, reports and
other data and services which any Contractor provides pursuant to its
respective Contract with respect to the Facility (the Collateral); provided
that so long as no Bankruptcy Default or Event of Default has occurred and is
continuing, Assignor shall have the right, to the exclusion of Assignee, to
exercise in its own name all rights and powers under any Contract to the same
extent as if this Assignment had not been executed; provided further that any
amount in respect of the assertion under any Contract of a claim for
consequential damages suffered by Assignor as a result of any breach of
warranty or other action by the relevant Contractor or any contractor,
subcontractor, supplier or materialman, including loss or damage resulting from
business interruption to the Facility, shall (except at such time as a
Bankruptcy Default or an Event of Bankruptcy Default shall have occurred and be
continuing) be paid to Assignor and shall not be considered part of the
Collateral.
SECTION 2. Remedies in Case of Default.
Assignor agrees that, if any Bankruptcy Default or Event of
Default shall have occurred and be continuing, then and in every such case,
subject to any mandatory requirements of any Applicable Law then in effect, the
Assignee, shall, subject to the terms and provisions hereof, have all rights as
a secured creditor under the Uniform Commercial Code in all relevant
jurisdictions and may exercise all rights to enforce all remedies, rights,
powers and privileges of the Assignor under this Agreement.
-2-
<PAGE> 4
SECTION 3. Termination; Release.
Upon the full and complete satisfaction of Assignor's
Obligations, this Assignment shall terminate and Assignee will execute and
deliver to Assignor a proper instrument or instruments (including Uniform
Commercial Code termination statements on form UCC-3) acknowledging the
satisfaction and termination of this Assignment, and will duly assign, transfer
and deliver to Assignor (without recourse and without any representation or
warranty) such of the Collateral as may be in the possession of the Assignee.
SECTION 4. Liability of Assignor and Assignee; of Contractors.
(a) Notwithstanding any other provision of this Assignment,
Assignor shall at all times remain liable under each Contract to perform all of
its duties and obligations thereunder to the same extent as if this Assignment
had not been executed. Furthermore, (a) neither this Assignment nor the
exercise by Assignee of any of the rights assigned hereunder shall cause
Assignee to become subject to any obligation or liability of Assignor, or
release Assignor from any its duties or obligations, under any Contract, or any
other instrument or document in respect of the construction and completion of
the Facility or the supply of oxygen thereto, except to the extent that such
exercise by Assignee shall constitute performance of such duties or
obligations, and (b) Assignee shall not have any obligation or liability under
any Contract, or any other instrument or document in respect of the
construction and completion of the Facility or the supply of oxygen thereto, by
reason of, or arising out of, this Assignment or be obligated to perform any of
the obligations or duties of Assignor under any Contract or any other
instrument or document in respect of the construction and completion of the
Facility or the supply of oxygen thereto or to make any inquiry as to the
sufficiency or authorization for any payment received by it or to take any
other action to collect or enforce any claim for payment assigned hereunder.
(b) Nothing herein contained shall subject any Contractor to
any liability to which it would not otherwise be subject or modify in any
respect such Contractor's rights against Assignor.
SECTION 5. Power of Attorney.
Assignor constitutes Assignee, its successors and assigns,
Assignor's true and lawful attorney, irrevocably, with full power (in the name
of Assignor or otherwise) to ask, require, demand, receive, compound and give
acquittance for any and all monies and claims for money due and to become due
under, or arising out of, the rights assigned
-3-
<PAGE> 5
hereunder and, for such period as Assignee may exercise rights with respect
thereto under this Assignment, to endorse any checks or other instruments or
orders in connection therewith and to file any claims or take any action or
institute or take control of any proceedings and to obtain any recovery in
connection therewith which to Assignee may seem necessary or advisable in the
enforcement of the rights assigned hereunder.
SECTION 6. Further Action.
Assignor agrees that at any time and from time to time, upon
the written request of Assignee, Assignor will promptly and duly execute and
deliver any and all such further instruments and documents and take such
further action as Assignee may reasonably request in order to obtain the full
benefits of this Assignment and of the rights and powers herein granted.
SECTION 7. Representations and Warranties of Assignor.
Assignor does hereby (i) represent and warrant that each
Contract is freely assignable for the purposes set forth herein, (ii) represent
and warrant to Assignee that it knows of no material default in the performance
by any Contractor which in any material respect may hinder completion of the
Facility or delay substantial completion of the Facility beyond September 30,
1994, (iii) represent and warrant that each Contractor has been mailed a Notice
of Assignment of its respective Contract in the forms attached as Exhibit A,
Exhibit B and Exhibit C hereto and that on or before the Closing Date each
Contractor will have consented to this Assignment, (iv) represent and warrant
that Assignor has not assigned or pledged, and covenant that it will not assign
or pledge, the whole or any part of the rights hereby assigned to anyone other
than Assignee, it being understood that Assignor is concurrently granting a
security interest in each Contract to another Lessor under a separate
assignment of contracts under circumstances and in a share which do not
conflict with this assignment, (v) covenant that it will not enter into any
agreement or take any action that would amend, modify, supplement, rescind,
waive, cancel or terminate any of the rights hereby assigned (A) without giving
10 Business Days' prior written notice thereof to Assignee or (B) in a manner
adverse to Assignee without Assignee's prior written consent or in a manner
which may result in an Event of Default, (vi) agree to cause all notices to
each Contractor to be given and delivered promptly and within the time provided
in, and otherwise in accordance with the terms of, each respective Contract,
(vii) agree to perform its obligations under each Contract and procure
performance on the part of each Contractor, (viii) agree forthwith to notify
Assignee of any default by any Contractor in its performance of any of the
provisions of its respective Contract, of any alleged default by Assignor with
respect to any Contract, and of any assertion by any Contractor that
circumstances have arisen which may permit or result in the termination of its
respective
-4-
<PAGE> 6
Contract, (ix) agree not to consent to any assignment or transfer of any
Contractor's rights or obligations under any Contract without the prior written
consent of Assignee, and (x) agree that following a Bankruptcy Default or an
Event of Default any and all payments received by Assignor from any Contractor
in respect of, but only to the extent they are in respect of, the Undivided
Interest shall be held in trust for Assignee and paid over to Assignee
forthwith for application in accordance with the provisions of the Lease.
SECTION 8. Assignment to Indenture Trustee.
In order to secure the indebtedness evidenced by the Note and
certain other obligations as provided in the Indenture, the Indenture provides,
among other things, for the further assignment by Assignee to the Indenture
Trustee of its right, title and interest in, to and under this Assignment, to
the extent set forth in the Indenture and for the creation of a security
interest in the Undivided Interest in favor of Indenture Trustee. Assignor
hereby consents to such further assignment and the creation of such security
interest, consents to the terms and provisions thereof and (a) acknowledges
that such assignment and security interest provide for the exercise by the
Indenture Trustee of all rights of Assignee hereunder to give any consents,
approvals, waivers, notices or the like, to make any elections, demands or the
like or to take any other discretionary action hereunder, except as
specifically set forth in the Indenture, and (b) agrees that, to the extent
provided in the Indenture, the Indenture Trustee shall have all the rights of
Assignee hereunder as if the Indenture Trustee had originally been named herein
as Assignee (every reference herein to Assignee being read to mean, except
where the context otherwise requires, the Indenture Trustee). Assignor will
furnish to the Indenture Trustee counterparts of all notices, certificates or
other documents of any kind required to be delivered hereunder by Assignor to
Assignee. So long as the Undivided Interest is subject to the lien of the
Indenture, Assignor shall make all payments of amounts payable hereunder (if
any) to Assignee, other than Excepted Payments, to the Indenture Trustee at the
office of the Indenture Trustee or such other office as the Indenture Trustee
may specify from time to time by notice to Assignee and Assignor, and the right
of the Indenture Trustee to receive all such payments shall not be subject to
any defense, counterclaim, setoff or other right or claim of any kind which
Assignor may be able to assert against Assignee or Owner Participant in an
action brought by either thereof on this Assignment.
SECTION 9. Notices.
Unless otherwise specifically provided herein, all notices,
requests, demands and other communications required or contemplated by the
provisions hereof shall be given as provided in the Participation Agreement.
-5-
<PAGE> 7
SECTION 10. Severability of Provisions.
Any provision of this Assignment 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 11. Successors and Assigns.
All covenants and agreements contained herein shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns.
SECTION 12. Governing Law.
This Assignment shall be governed by, and construed in
accordance with, the laws of the State of New York.
SECTION 13. Headings.
The division of this Assignment into sections and the
insertion of headings are for convenience of reference only and shall not
affect the construction or interpretation of this Assignment.
SECTION 14. Counterparts.
This Assignment may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.
-6-
<PAGE> 8
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment to be duly executed the date first above written.
NEWMONT GOLD COMPANY
By
-------------------------------
Title:
SHAWMUT BANK CONNECTICUT,
NATIONAL ASSOCIATION, not
in its individual capacity but
solely as trustee under a Trust
Agreement with Philip Morris
Capital Corporation dated as of
July 15, 1994,
By
-------------------------------
Title:
-7-
<PAGE> 9
EXHIBIT A
to
ASSIGNMENT OF CONTRACTS
NOTICE OF ASSIGNMENT
To: LURGI CHEMIE METALLURGIE INDUSTRIEBAU GMBH
-------------------------------------------
-------------------------------------------
Re: Contract For Engineering and
Equipment Procurement Services
This is to notify you that, pursuant to the terms of the
Assignment of Contracts, dated September __, 1994 (herein called the
Assignment), from Newmont Gold Company, as Assignor, to Shawmut Bank
Connecticut, National Association, not in its individual capacity, but solely
as Owner Trustee under a Trust Agreement dated as of July 15, 1994, as
Assignee, all of the Assignor's right, title and interest in, to and under the
above referenced Contract (the Contract) between Assignor and you, to the
extent of the Lessor's Share, has been assigned by Assignor to Assignee.
Assignee has in turn assigned all right, title and interest to the First
National Bank of Chicago, as Indenture Trustee (Indenture Trustee), pursuant to
a Trust Indenture and Security Agreement dated as of July 15, 1994. Henceforth
(i) all of your representations, warranties, indemnities and agreements with
respect to the Facility contained in the Contract shall inure to the benefit of
the Indenture Trustee (so long as the Facility is subject to the lien of the
said Indenture) and thereafter to Assignee to the same extent as if the
Indenture Trustee or, as the case may be, Assignee were the original
contracting party to the Contract, (ii) upon your receipt of written
notification from Assignee or the Indenture Trustee that a Default or Event of
Default under the Lease between Assignee and Assignor, dated July 15, 1994, has
occurred and is continuing, sums, if any, payable by you under the Contract,
including damages for breach of the Contract will be paid, to the extent of the
Lessor's Share, to the Indenture Trustee at the office of [____________], or as
the Indenture Trustee may direct from time to time (so long as the Facility is
subject to the lien of said Indenture) and thereafter to Assignee or as it may
direct form time to time, and (iii) you shall continue to look solely
<PAGE> 10
to Assignor for payment of any amounts due or to become due and for the
performance of all of Assignor's obligations under the Contract and neither
Assignee nor the Indenture Trustee shall be liable for any obligations or
duties of Assignor under the Contract or otherwise with respect to the
Facility.
Until you receive written notice to the contrary from Assignee
or the Indenture Trustee, you may assume (a) that the Undivided Interest
remains subject to the lien of said Indenture, (b) that no such Default or
Event of Default has occurred and (c) that any such Default or Event of Default
of which you have received notice is continuing.
Where the Assignment requires Assignor to give Assignee or the
Indenture Trustee certain prior notice of action involving or affecting you
that it proposes to take, or to obtain the consent of Assignee or the Indenture
Trustee to such action, you may also assume that such required notice has been
given or such required consent has been obtained unless you have received
written notice to the contrary from Assignee or the Indenture Trustee at least
10 Business Days before such action is taken; and unless such notice has been
given to you, the failure of Assignor to give such required notice to Assignee
or the Indenture Trustee or to obtain such required consent from Assignee or
the Indenture Trustee shall not affect the validity of the action taken insofar
as it affects your rights or obligations.
Should Assignor assert a warranty claim against you, the
amount of which you dispute, and an agreement is reached to settle such claim
for less than the amount originally claimed by Assignor, you may assume that
such settlement was agreed to by Assignee and the Indenture Trustee.
You shall also be entitled to rely upon any notice given to
you by Assignor, Assignee or the Indenture Trustee without inquiring as to the
factual correctness of such notice.
-2-
<PAGE> 11
Please acknowledge receipt of this Notice and indicate your
consent to the Assignment on the enclosed copy and return it to us.
Dated: September __, 1994
NEWMONT GOLD COMPANY
By
--------------------------
Title:
Acknowledged, confirmed, consented to and
agreed to with full right, title, power
and authority so to do:
LURGIE CHEMIE METALLURGIE INDUSTRIEBAU GMBH
By
----------------------------------------
Title:
-3-
<PAGE> 12
EXHIBIT B
to
ASSIGNMENT OF CONTRACTS
NOTICE OF ASSIGNMENT
To: BECHTEL CORPORATION
--------------------------
--------------------------
Re: Contract For Engineering, Procurement and
Construction Management Services, Job 21777
This is to notify you that, pursuant to the terms of the
Assignment of Contracts, dated September __, 1994 (herein called the
Assignment), from Newmont Gold Company, as Assignor, to Shawmut Bank
Connecticut, National Association, not in its individual capacity, but solely
as Owner Trustee under a Trust Agreement dated as of July 15, 1994, as
Assignee, all of the Assignor's right, title and interest in, to and under the
above referenced Contract (the Contract) between Assignor and you, to the
extent of the Lessor's Share, has been assigned by Assignor to Assignee.
Assignee has in turn assigned all right, title and interest to the First
National Bank of Chicago, as Indenture Trustee (Indenture Trustee), pursuant to
a Trust Indenture and Security Agreement dated as of July 15, 1994. Henceforth
(i) all of your representations, warranties, indemnities and agreements with
respect to the Facility contained in the Contract shall inure to the benefit of
the Indenture Trustee (so long as the Facility is subject the lien of the said
Indenture) and thereafter to Assignee to the same extent as if the Indenture
Trustee or, as the case may be, Assignee were the original contracting party to
the Contract, (ii) upon your receipt of written notification from Assignee or
the Indenture Trustee that a Default or Event of Default under the Lease
between Assignee and Assignor, dated July 15, 1994, has occurred and is
continuing, sums, if any, payable by you under the Contract, including damages
for breach of the Contract will be paid, to the extent of the Lessor's Share,
to the Indenture Trustee at the office of [_____________], or as the Indenture
Trustee may direct from time to time (so long as the Facility is subject to the
lien of said Indenture) and thereafter to Assignee or as it may direct from
time to time, and (iii) you shall continue to look solely
-1-
<PAGE> 13
to Assignor for payment of any amounts due or to become due and for the
performance of all of Assignor's obligations under the Contract and neither
Assignee nor the Indenture Trustee shall be liable for any obligations or
duties of Assignor under the Contract or otherwise with respect to the
Facility.
Until you receive written notice to the contrary from Assignee
or the Indenture Trustee, you may assume (a) that the Undivided Interest
remains subject to the lien of said Indenture, (b) that no such Default or
Event of Default has occurred and (c) that any such Default or Event of Default
of which you have received notice is continuing.
Where the Assignment requires Assignor to give Assignee or the
Indenture Trustee certain prior notice of action involving or affecting you
that it proposes to take, or to obtain the consent of Assignee or the Indenture
Trustee to such action, you may also assume that such required notice has been
given or such required consent has been obtained unless you have received
written notice to the contrary from Assignee or the Indenture Trustee at least
10 Business Days before such action is taken; and unless such notice has been
given to you, the failure of Assignor to give such required notice to Assignee
or the Indenture Trustee or to obtain such required consent from Assignee or
the Indenture Trustee shall not affect the validity of the action taken insofar
as it affects your rights or obligations.
Should Assignor assert a warranty claim against you, the
amount of which you dispute, and an agreement is reached to settle such claim
for less than the amount originally claimed by Assignor, you may assume that
such settlement was agreed to by Assignee and the Indenture Trustee.
You shall also be entitled to rely upon any notice given to
you by Assignor, Assignee or the Indenture Trustee without inquiring as to the
factual correctness of such notice.
-2-
<PAGE> 14
Please acknowledge receipt of this Notice and indicate your
consent to the Assignment on the enclosed copy and return it to us.
Dated: September __, 1994
NEWMONT GOLD COMPANY
By
--------------------------
Title:
Acknowledged, confirmed, consented to and
agreed to with full right, title, power
and authority so to do:
BECHTEL CORPORATION,
By
------------------------
Title:
-3-
<PAGE> 15
EXHIBIT C
to
ASSIGNMENT OF CONTRACTS
NOTICE OF ASSIGNMENT
To: PRAXAIR, INC.
--------------------------
--------------------------
Re: Oxygen Supply Agreement dated September 1, 1992
This is to notify you that, pursuant to the terms of the
Assignment of Contracts, dated September __, 1994 (herein called the
Assignment), from Newmont Gold Company, as Assignor, to Shawmut Bank
Connecticut, National Association, not in its individual capacity, but solely
as Owner Trustee under a Trust Agreement dated as of July 15, 1994, as
Assignee, all of the Assignor's right, title and interest in, to and under the
above referenced Contract (the Oxygen Supply Contract) between Assignor and
you, to the extent of the Lessor's Share, has been assigned by Assignor to
Assignee. Assignee has in turn assigned all right, title and interest to the
First National Bank of Chicago, as Indenture Trustee (Indenture Trustee),
pursuant to a Trust Indenture and Security Agreement dated as of July 15, 1994.
Henceforth (i) all of your representations, warranties, indemnities and
agreements with respect to the Facility contained in the Oxygen Supply Contract
shall inure to the benefit of the Indenture Trustee (so long as the Facility is
subject the lien of the said Indenture) and thereafter to Assignee to the same
extent as if the Indenture Trustee or, as the case may be, Assignee were the
original contracting party to the Oxygen Supply Contract, (ii) upon your
receipt of written notification from Assignee or the Indenture Trustee that a
Default or Event of Default under the Lease between Assignee and Assignor,
dated July 15, 1994, has occurred and is continuing, sums, if any, payable by
you under the Oxygen Supply Contract, including damages for breach of the
Oxygen Supply Contract will be paid, to the extent of the Lessor's Share, to
the Indenture Trustee at the office of [_____________], or as the Indenture
Trustee may direct from time to time (so long as the Facility is subject to the
lien of said Indenture) and thereafter to Assignee or as it may direct from
time to time, and (iii) you shall continue to look solely to Assignor for
payment of any amounts due or to become due and for the performance of all of
Assignor's
-4-
<PAGE> 16
obligations under the Oxygen Supply Contract and neither Assignee nor the
Indenture Trustee shall be liable for any obligations or duties of Assignor
under the Oxygen Supply Contract or otherwise with respect to the Facility.
Until you receive written notice to the contrary from Assignee
or the Indenture Trustee, you may assume (a) that the Undivided Interest
remains subject to the lien of said Indenture, (b) that no such Default or
Event of Default has occurred and (c) that any such Default or Event of Default
of which you have received notice is continuing.
Where the Assignment requires Assignor to give Assignee or the
Indenture Trustee certain prior notice of action involving or affecting you
that it proposes to take, or to obtain the consent of Assignee or the Indenture
Trustee to such action, you may also assume that such required notice has been
given or such required consent has been obtained unless you have received
written notice to the contrary from Assignee or the Indenture Trustee at least
10 Business Days before such action is taken; and unless such notice has been
given to you, the failure of Assignor to give such required notice to Assignee
or the Indenture Trustee or to obtain such required consent from Assignee or
the Indenture Trustee shall not affect the validity of the action taken insofar
as it affects your rights or obligations.
Should Assignor assert a warranty claim against you, the
amount of which you dispute, and an agreement is reached to settle such claim
for less than the amount originally claimed by Assignor, you may assume that
such settlement was agreed to by Assignee and the Indenture Trustee.
You shall also be entitled to rely upon any notice given to
you by Assignor, Assignee or the Indenture Trustee without inquiring as to the
factual correctness of such notice.
-5-
<PAGE> 17
Please acknowledge receipt of this Notice and indicate your
consent to the Assignment on the enclosed copy and return it to us.
Dated: September __, 1994
NEWMONT GOLD COMPANY
By
------------------------
Title:
Acknowledged, confirmed, consented to and
agreed to with full right, title, power
and authority so to do:
PRAXAIR, INC.,
By
------------------------
Title:
-6-
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Form S-3 Registration Statement of our reports dated January
25, 1994 included in Newmont Gold Company's Form 10-K for the year ended
December 31, 1993 and our report dated March 30, 1994 included in Newmont Gold
Company's Form 8-K dated April 5, 1994 and to all references to our Firm
included in this Registration Statement.
ARTHUR ANDERSEN & CO.
Denver, Colorado,
August 2, 1994
<PAGE> 1
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Timothy J. Schmitt and Graham
M. Clark, Jr., and each of them, his true and lawful attorneys-in-fact and
agents, with full power of substitution and revocation, in his name and on his
behalf, to do any and all acts and things and to execute any and all
instruments which they and each of them may deem necessary or advisable to
enable Newmont Gold Company (the "Company") to comply with the Securities Act
of 1933, as amended (the "Act"), and any rules, regulations or requirements of
the Securities and Exchange Commission in respect thereof, in connection with
the registration under the Act of up to, and including, $300 million of
pass-through certificates to be issued in connection with the financing of the
Company's refractory ore treatment plant, including power and authority to sign
his name in any and all capacities (including his capacity as a Director and/or
Officer of the Company) to a Registration Statement on Form S-3 or such other
form as may be appropriate, and to any and all amendments, including
post-effective amendments, to such Registration Statement, and to any and all
instruments or documents filed as part of or in connection with such
Registration Statement or any amendments thereto; and the undersigned hereby
ratifies and confirms all that said attorneys-in-fact and agents, or any of
them, shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned have subscribed these
presents as of the 13th day of July, 1994.
Signature Title
- --------- -----
/s/ Rudolph I.J. Agnew Director
------------------------
Rudolph I.J. Agnew
/s/ J.P. Bolduc Director
------------------------
J.P. Bolduc
/s/ Ronald C. Cambre Vice Chairman, President
------------------------ and Chief Executive Officer
Ronald C. Cambre and Director (Principal
Executive Officer)
<PAGE> 2
/s/ Joseph P. Flannery Director
------------------------
Joseph P. Flannery
/s/ Thomas A. Holmes Director
------------------------
Thomas A. Holmes
/s/ Gordon R. Parker Chairman and Director
------------------------
Gordon R. Parker
/s/ Robin A. Plumbridge Director
------------------------
Robin A. Plumbridge
/s/ Robert H. Quenon Director
------------------------
Robert H. Quenon
/s/ James V. Taranik Director
------------------------
James V. Taranik
/s/ William I.M. Turner, Jr. Director
------------------------
William I.M. Turner, Jr.
/s/ Wayne W. Murdy Senior Vice President
------------------------ and Chief Financial Officer
Wayne W. Murdy (Principal Financial Officer)
/s/ Gary E. Farmar Vice President and Controller
------------------------
Gary E. Farmar (Principal Accounting Officer)
-2-
<PAGE> 1
EXHIBIT 25.1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(B)(2) -----
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
</TABLE>
THE FIRST NATIONAL BANK OF CHICAGO
ONE FIRST NATIONAL PLAZA, SUITE 0286
CHICAGO, ILLINOIS 60670-0286
ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
-----------------------------------
NEWMONT GOLD COMPANY
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
DELAWARE 13-2526632
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
1700 LINCOLN STREET
DENVER, COLORADO 80203
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
</TABLE>
SERIES 1994-A1 PASS THROUGH CERTIFICATES
(TITLE OF INDENTURE SECURITIES)
<PAGE> 2
ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING
INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR
SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(B) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate
trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE> 3
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the
United States of America, has duly caused this Statement of
Eligibility to be signed on its behalf by the undersigned, thereunto
duly authorized, all in the City of Chicago and State of Illinois, on
the 29th day of July, 1994.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE,
BY /S/ JOHN R. PRENDIVILLE
JOHN R. PRENDIVILLE
VICE PRESIDENT
*Exhibits 1, 2, 3, and 4 are herein incorporated by reference to
Exhibits bearing identical numbers in Item 12 of the Form T-1 of The
First National Bank of Chicago, filed as Exhibit 26(b) to the
Registration Statement on Form S-3 of Dow Capital B.V. and The Dow
Chemical Company, filed with the Securities and Exchange Commission on
June 3, 1991 (Registration No. 33-36314).
3
<PAGE> 4
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
July 29, 1994
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Newmont Gold
Company and The First National Bank of Chicago, the undersigned, in accordance
with Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby
consents that the reports of examinations of the undersigned, made by Federal
or State authorities authorized to make such examinations, may be furnished by
such authorities to the Securities and Exchange Commission upon its request
therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
BY: /s/JOHN R. PRENDIVILLE
JOHN R. PRENDIVILLE
VICE PRESIDENT
4
<PAGE> 5
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE> 6
<TABLE>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 3/31/94 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Suite 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR MARCH 31, 1994
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
C400 <-
DOLLAR AMOUNTS IN ------------ ---------
THOUSANDS RCFD BIL MIL THOU
------------------ ----- -------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions
(from Schedule RCA-A):
a. Noninterest-bearing balances and currency and
coin(1) . . . . . . . . . . . . . . . . . . . . . . . . . 0081 3,199,527 1.a.
b. Interest-bearing balances(2) . . . . . . . . . . . . . . . 0071 7,574,509 1.b.
2. Securities . . . . . . . . . . . . . . . . . . . . . . . . .
a. Held-to-maturity securities(from Schedule
RC-B, column A) 1754 125,951 2.a.
b. Available-for-sale securities (from
Schedule RC-B, column D) . . . . . . . . . . . . . . . . . 1773 318,814 2.b.
3. Federal funds sold and securities purchased under
agreements to resell in domestic offices of the bank
and its Edge and Agreement subsidiaries, and in IBFs:
a. Federal Funds sold . . . . . . . . . . . . . . . . . . . . 0276 2,711,748 3.a.
b. Securities purchased under agreements to resell . . . . . 0277 695,723 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 2122 13,613,912 4.a.
b. LESS: Allowance for loan and lease losses . . . . . . . . RCFD 3123 352,027 4.b.
c. LESS: Allocated transfer risk reserve . . . . . . . . . . RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c) . . . . . . . . . . . 2125 13,261,885 4.d.
5. Assets held in trading accounts . . . . . . . . . . . . . . . 3545 8,561,533 5.
6. Premises and fixed assets (including capitalized leases) . . 2145 478,470 6.
7. Other real estate owned (from Schedule RC-M) . . . . 2150 95,399 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M) . . . . . . . . . . . . . . . 2130 6,434 8.
9. Customers' liability to this bank on acceptances
outstanding . . . . . . . . . . . . . . . . . . . . . . . . . 2155 452,815 9.
10. Intangible assets (from Schedule RC-M) . . . . . . . . . . . 2143 140,023 10.
11. Other assets (from Schedule RC-F) . . . . . . . . . . . . . . 2160 1,048,744 11.
12. Total assets (sum of items 1 through 11) . . . . . . . . . . 2170 38,671,575 12.
</TABLE>
- ------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE> 7
<TABLE>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 3/31/94 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Suite 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
Thousands BIL MIL THOU
---------------- ------------
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1) . . . . . . . . . . . . . RCON 2200 14,309,869 13.a.
(1) Noninterest-bearing(1) . . . . . . . . . . . . . . RCON 6631 5,980,761 13.a.(1)
(2) Interest-bearing . . . . . . . . . . . . . . . . . RCON 6636 8,329,108 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries,
and IBFs (from Schedule RC-E, part II) . . . . . . . . RCFN 2200 9,813,189 13.b.
(1) Noninterest bearing . . . . . . . . . . . . . . . RCFN 6631 374,630 13.b.(1)
(2) Interest-bearing RCFN 6636 9,438,559 13.b.(2)
14. Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of the bank
and of its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased . . . . . . . . . . . . . . . RCFD 0278 580,252 14.a.
b. Securities sold under agreements to repurchase . . . . RCFD 0279 1,543,995 14.b.
15. a. Demand notes issued to the U.S. Treasury . . . . . . . RCON 2840 102,941 15.a.
b. Trading Liabilities . . . . . . . . . . . . . . . . . RCFD 3548 5,353,511 15.b.
16. Other borrowed money:
a. With original maturity of one year or less . . . . . . RCFD 2332 1,590,728 16.a.
b. With original maturity of more than one year . . . . RCFD 2333 254,470 16.b.
17. Mortgage indebtedness and obligations under
capitalized leases . . . . . . . . . . . . . . . . . . . RCFD 2910 267,000 17.
18. Bank's liability on acceptance executed and
outstanding . . . . . . . . . . . . . . . . . . . . . . . RCFD 2920 452,815 18.
19. Subordinated notes and debentures . . . . . . . . . . . . RCFD 3200 1,175,000 19.
20. Other liabilities (from Schedule RC-G) . . . . . . . . . RCFD 2930 549,976 20.
21. Total liabilities (sum of items 13 through 20) . . . . . RCFD 2948 35,993,746 21.
22. Limited-Life preferred stock and related surplus. . . . . RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus . . . . . . RCFD 3838 0 23.
24. Common stock . . . . . . . . . . . . . . . . . . . . . . RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred
stock) . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 3839 2,254,940 25.
26. a. Undivided profits and capital reserves . . . . . . . . RCFD 3632 222,981 26.a.
b. Net unrealized holding gains (losses) on
available-for-sale securities . . . . . . . . . . . . . . RCFD 8434 (8) 26.b.
27. Cumulative foreign currency translation adjustments . . . RCFD 3284 (942) 27.
28. Total equity capital (sum of items 23 through 27) . . . . RCFD 3210 2,677,829 28.
29. Total liabilities, limited-life preferred stock,
and equity capital (sum of items 21, 22, and 28) . . . . RCFD 3300 38,671,575 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<S> <C> <C>
1. Indicate in the box at the right the number of the statement
below that best describes the most comprehensive level of
auditing work performed for the bank by independent external Number
auditors as of any date during 1993 . . . . . . . . . . . . . . . . . . . . . . . RCFD 6724 2. M.1.
</TABLE>
1 = Independent audit of the bank conducted in accordance
with generally accepted auditing standards by a certified
public accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company
conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which
submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
4. = Directors' examination of the bank performed by other
external auditors (may be required by state chartering
authority)
5 = Review of the bank's financial statements by external
auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
- -------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
<PAGE> 1
EXHIBIT 25.2
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(B)(2) -----
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
</TABLE>
THE FIRST NATIONAL BANK OF CHICAGO
ONE FIRST NATIONAL PLAZA, SUITE 0286
CHICAGO, ILLINOIS 60670-0286
ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
--------------------------------------
NEWMONT GOLD COMPANY
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
DELAWARE 13-2526632
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
1700 LINCOLN STREET
DENVER, COLORADO 80203
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
</TABLE>
SERIES 1994-A2 PASS THROUGH CERTIFICATES
(TITLE OF INDENTURE SECURITIES)
<PAGE> 2
ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING
INFORMATION AS TO THE TRUSTEE:
(a) NAME AND ADDRESS OF EACH EXAMINING OR
SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate
trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE> 3
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the
United States of America, has duly caused this Statement of
Eligibility to be signed on its behalf by the undersigned, thereunto
duly authorized, all in the City of Chicago and State of Illinois, on
the 29th day of July, 1994.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE,
BY /S/ JOHN R. PRENDIVILLE
JOHN R. PRENDIVILLE
VICE PRESIDENT
*Exhibits 1, 2, 3, and 4 are herein incorporated by reference to
Exhibits bearing identical numbers in Item 12 of the Form T-1 of The
First National Bank of Chicago, filed as Exhibit 26(b) to the
Registration Statement on Form S-3 of Dow Capital B.V. and The Dow
Chemical Company, filed with the Securities and Exchange Commission on
June 3, 1991 (Registration No. 33-36314).
3
<PAGE> 4
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
July 29, 1994
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Newmont Gold
Company and The First National Bank of Chicago, the undersigned, in accordance
with Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby
consents that the reports of examinations of the undersigned, made by Federal
or State authorities authorized to make such examinations, may be furnished by
such authorities to the Securities and Exchange Commission upon its request
therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
BY: /S/ JOHN R. PRENDIVILLE
JOHN R. PRENDIVILLE
VICE PRESIDENT
4
<PAGE> 5
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE> 6
<TABLE>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 3/31/94 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Suite 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR MARCH 31, 1994
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
C400 <-
DOLLAR AMOUNTS IN ------------ ----------
THOUSANDS RCFD BIL MIL THOU
----------------------- ---- ------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions
(from Schedule RCA-A):
a. Noninterest-bearing balances and currency and
coin(1) . . . . . . . . . . . . . . . . . . . . . . . . . 0081 3,199,527 1.a.
b. Interest-bearing balances(2). . . . . . . . . . . . . . 0071 7,574,509 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B,
column A) . . . . . . . . . . . . . . . . . . . . . . . . 1754 125,951 2.a.
b. Available-for-sale securities (from Schedule RC-B,
column D) . . . . . . . . . . . . . . . . . . . . . . . . 1773 318,814 2.b.
3. Federal funds sold and securities purchased under
agreements to resell in domestic offices of the bank
and its Edge and Agreement subsidiaries, and in IBFs:
a. Federal Funds sold . . . . . . . . . . . . . . . . . . 0276 2,711,748 3.a.
b. Securities purchased under agreements to resell . . . . 0277 695,723 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C) . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 2122 13,613,912 4.a.
b. LESS: Allowance for loan and lease losses . . . . . . . RCFD 3123 352,027 4.b.
c. LESS: Allocated transfer risk reserve . . . . . . . . . RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance,
and reserve (item 4.a minus 4.b and 4.c) . . . . . . . . 2125 13,261,885 4.d.
5. Assets held in trading accounts . . . . . . . . . . . . . 3545 8,561,533 5.
6. Premises and fixed assets (including capitalized
leases) . . . . . . . . . . . . . . . . . . . . . . . . . 2145 478,470 6.
7. Other real estate owned (from Schedule RC-M) . . . . . . . 2150 95,399 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M) . . . . . . . . . . . . . . 2130 6,434 8.
9. Customers' liability to this bank on acceptances
outstanding . . . . . . . . . . . . . . . . . . . . . . . 2155 452,815 9.
10. Intangible assets (from Schedule RC-M) . . . . . . . . . . 2143 140,023 10.
11. Other assets (from Schedule RC-F) . . . . . . . . . . . . 2160 1,048,744 11.
12. Total assets (sum of items 1 through 11) . . . . . . . . . 2170 38,671,575 12.
</TABLE>
- ------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE> 7
<TABLE>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 3/31/94 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Suite 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
Thousands BIL MIL THOU
---------------- ------------
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A
and C from Schedule RC-E, part 1) . . . . . . . . . . . RCON 2200 14,309,869 13.a.
(1) Noninterest-bearing(1) . . . . . . . . . . . . . . . RCON 6631 5,980,761 13.a.(1)
(2) Interest-bearing . . . . . . . . . . . . . . . . . . RCON 6636 8,329,108 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries,
and IBFs (from Schedule RC-E, part II) . . . . . . . . . RCFN 2200 9,813,189 13.b.
(1) Noninterest bearing . . . . . . . . . . . . . . . . RCFN 6631 374,630 13.b.(1)
(2) Interest-bearing RCFN 6636 9,438,559 13.b.(2)
14. Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of
the bank and of its Edge and Agreement subsidiaries,
and in IBFs:
a. Federal funds purchased . . . . . . . . . . . . . . . . RCFD 0278 580,252 14.a.
b. Securities sold under agreements to repurchase . . . . . RCFD 0279 1,543,995 14.b.
15. a. Demand notes issued to the U.S. Treasury . . . . . . . . RCON 2840 102,941 15.a.
b. Trading Liabilities . . . . . . . . . . . . . . . . . . RCFD 3548 5,353,511 15.b.
16. Other borrowed money:
a. With original maturity of one year or less . . . . . . . RCFD 2332 1,590,728 16.a.
b. With original maturity of more than one year . . . . . RCFD 2333 254,470 16.b.
17. Mortgage indebtedness and obligations under capitalized
leases . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 2910 267,000 17.
18. Bank's liability on acceptance executed and outstanding RCFD 2920 452,815 18.
19. Subordinated notes and debentures . . . . . . . . . . . . . RCFD 3200 1,175,000 19.
20. Other liabilities (from Schedule RC-G). . . . . . . . . . . RCFD 2930 549,976 20.
21. Total liabilities (sum of items 13 through 20) . . . . . . RCFD 2948 35,993,746 21.
22. Limited-Life preferred stock and related surplus. . . . . . RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus . . . . . . . RCFD 3838 0 23.
24. Common stock. . . . . . . . . . . . . . . . . . . . . . . . RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock) RCFD 3839 2,254,940 25.
26. a. Undivided profits and capital reserves . . . . . . . . . RCFD 3632 222,981 26.a.
b. Net unrealized holding gains (losses) on
available-for-sale securities . . . . . . . . . . . . . RCFD 8434 (8) 26.b.
27. Cumulative foreign currency translation adjustments . . . . RCFD 3284 (942) 27.
28. Total equity capital (sum of items 23 through 27) RCFD 3210 2,677,829 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28) . . . . . . . . . . RCFD 3300 38,671,575 29.
</TABLE>
<TABLE>
<CAPTION>
Memorandum
<S> <C> <C>
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below
that best describes the most comprehensive level of auditing work
performed for the bank by independent external Number
auditors as of any date during 1993 . . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 6724 M.1.
</TABLE>
1 = Independent audit of the bank conducted in accordance with
generally accepted auditing standards by a certified
public accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company
conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which
submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
4. = Directors' examination of the bank performed by other
external auditors (may be required by state chartering authority)
5 = Review of the bank's financial statements by external
auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
- -----------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
