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NBD Bancorp / Johnstown America Industries - Bond Guaranty And Lease Agreement
BOND GUARANTY AGREEMENT
THIS BOND GUARANTY AGREEMENT dated March 1, 1999 is entered into by BOSTROM SEATING, INC. (herein collectively the "Guarantor") for the benefit of NBD BANK, a banking corporation with its principal place of business in Detroit, Michigan (the "Trustee"), as trustee under the Indenture referred to below.
RECITALS
The Industrial Development Board of the City of Piedmont (the "Issuer") has duly authorized the creation, execution and delivery, under and pursuant to that certain Trust Indenture dated March 1, 1999 (the "Indenture") from the Issuer to the Trustee, $3,100,000 aggregate principal amount of Variable/Fixed Rate Industrial Development Revenue Bonds (Bostrom Seating, Inc. Project) dated the date of delivery (the "Bonds").
The proceeds of the Bonds shall be applied by the Issuer to pay the costs of acquiring, constructing and installing buildings, structures, facilities and related machinery and equipment on certain realty heretofore acquired by the Issuer for use in the manufacturing, processing, assembling, storing and distribution of seats for heavy trucks and buses and related products (said real estate, buildings, structures, facilities, machinery, equipment and related personal property being hereinafter collectively referred to as the "Project").
Simultaneously with the issuance of the Bonds the Issuer and Bostrom Seating, Inc., a Delaware corporation (the "Guarantor") will enter into a Lease Agreement dated March 1, 1999 (the "Lease Agreement"), whereby the Issuer will agree to lease the Project to the Guarantor and the Guarantor will agree to pay rentals to the Issuer at such times and in such amounts as shall be sufficient to pay when due the principal of, premium (if any) and interest ("Debt Service") on the Bonds and the purchase price of Bonds tendered for purchase pursuant to the mandatory or optional tender provisions of the Indenture.
The Bonds shall be limited obligations of the Issuer payable solely out of the rentals payable by the Guarantor pursuant to the Lease Agreement and any other revenues, rentals or receipts derived by the Issuer from the leasing or sale of the Project (the "Lease Revenues").
As additional security for the payment of Debt Service on the Bonds, the Guarantor will enter into this Bond Guaranty Agreement dated March 1, 1999 (the "Bond Guaranty") in favor of the Trustee, whereby the Guarantor will guarantee payment when due of Debt Service on the Bonds.
As additional security for the payment of the Bonds, the Guarantor will cause Chase Manhattan Bank Delaware (in its capacity as issuer of the initial letter of credit referred to below, the "Credit Obligor") to issue an irrevocable letter of credit in favor of the Trustee in the amount of (i) the aggregate principal amount of the Bonds, to enable the Trustee to pay the principal amount of the Bonds when due and to pay the principal portion of the purchase price of Bonds
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tendered (or deemed tendered) for purchase, plus (ii) interest on the Bonds for a period of 56 days at the rate of 12% per annum, to enable the Trustee to pay interest on the Bonds when due and to pay the interest portion of the purchase price of Bonds tendered (or deemed tendered) for purchase. The initial letter of credit to be delivered to the Trustee and any substitute letter of credit delivered to the Trustee pursuant to this Indenture are herein referred to as the "Letter of Credit".
The Letter of Credit is initially issued pursuant to various credit, guaranty and security agreements among the Credit Obligor, the Issuer, the User, and persons related to the User, which evidence, guarantee or provide security for the obligations of the User to reimburse the Credit Obligor for draws under the Letter of Credit and the observance and performance of various agreements of the User related thereto (collectively the "Credit Documents").
NOW, THEREFORE, for and in consideration of the premises, the consummation by the Issuer and the Trustee of the transactions contemplated by the Indenture and the Lease Agreement and the purchase of the Bonds by all Holders thereof, the Guarantor hereby covenants, agrees and binds itself as follows:
ARTICLE I
PROVISIONS OF GENERAL APPLICATION
SECTION 1.01 DEFINITIONS
For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires:
"BENEFICIAL OWNERS" shall mean the owners of the beneficial interests in the Bonds.
"CODE" means the Internal Revenue Code of 1986, as amended.
"DEFAULT" shall mean an event or condition the occurrence of which would, with or without the lapse of time or the giving of notice or both, be an Event of Default.
"EVENT OF DEFAULT" shall mean an event as defined in Article VI.
"FINANCING DOCUMENTS" shall mean collectively the Indenture, the Lease Agreement, the Bond Guaranty Agreement, the Credit Documents, and the Remarketing Agreement (as defined in the Indenture).
"FINANCING PARTICIPANTS" shall mean the parties to the Financing Documents.
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"HOLDER" means the Beneficial Owners of any of the Bonds or a former Beneficial Owner of any of the Bonds entitled to enforce any rights hereunder.
"LIEN" shall mean any interest in Property securing an obligation owed to, or a claim by, a Person other than the owner of the Property, whether such interest is based on the common law, statute or contract, and including but not limited to the security interest or lien arising from a mortgage, encumbrance, pledge, conditional sale or trust receipt or a lease assignment or bailment for security purposes. For the purposes of this Agreement, the Guarantor shall be deemed to be the owner of any Property which it shall have acquired or holds or hold subject to a conditional sale agreement, financing lease or other arrangement pursuant to which title to the Property has been retained by or vested in some other person for security purposes.
"MATERIAL ADVERSE EFFECT" shall mean any act or circumstance or event which (i) causes an Event of Default or Default, (ii) otherwise might be material and adverse to the financial condition or business operations of the Guarantor or (iii) would adversely affect the validity or enforceability of any of the papers executed in connection with the Bonds.
"PERSON" shall mean and include an individual, a partnership, a joint venture, a corporation, an association, a trust, an unincorporated organization and a government or any department, agency or political subdivision thereof.
"PROPERTY" shall mean any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.
"TRIBUNAL" shall mean any state, commonwealth, federal, foreign, district, territorial, or other court or governmental department, board, bureau, agency or instrumentality having jurisdiction over Guarantor.
SECTION 1.02 ACCOUNTING PRINCIPLES
Where the character or amount of any asset or liability or item of income or expense is required to be determined is required to be made for the purposes of this Agreement, this shall be done in accordance with the system of accounting used by Guarantor preparation of its federal income tax returns. The User shall maintain books and records in accordance with generally accepted accounting principles ("GAAP") consistently applied.
SECTION 1.03 ACTION TAKEN DIRECTLY OR INDIRECTLY
Where any provision in this Agreement refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly by such Person.
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SECTION 1.04 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the laws of the State of Alabama.
SECTION 1.05 GENERAL RULES OF CONSTRUCTION
(1) Capitalized terms used herein without definition shall have the meaning assigned to them in the Indenture.
(2) Singular terms shall include the plural as well as the singular, and vice versa.
(3) All references in this instrument to designated "Articles", "Sections" and other subdivisions are to the designated Articles, Sections and subdivisions of this instrument as originally executed.
(4) The terms "herein", "hereof" and "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or other subdivision.
SECTION 1.06 EFFECT OF HEADINGS AND TABLE OF CONTENTS
The Article and Section headings herein and in the Table of Contents are for convenience only and shall not affect the construction hereof.
ARTICLE II
GUARANTY
SECTION 2.01 GUARANTY OF PAYMENT OF BONDS
(a) The Guarantor hereby absolutely and unconditionally guarantees (i) the punctual payment when due (whether at stated maturity, by acceleration or call for redemption or otherwise), in lawful money of the United States of America, of any and all sums which may become due at any time or from time to time to each Holder as Debt Service on the Bonds, including interest on any past due amounts of Debt Service (but without regard to any provision set forth in the Bonds or the Indenture limiting the sources of payment of amounts becoming due on the Bonds), (ii) the full and prompt payment of all costs and expenses, including court costs and reasonable attorneys' fees, incurred by the Trustee or any Holder in attempting to collect or enforce any such obligations), and (iii) the prompt payment of all other amounts payable by the Issuer under the Indenture. If a Holder or the Trustee shall fail to receive any such payment when due as aforesaid, the Guarantor shall immediately pay to the Holder or the Trustee, as appropriate, in lawful money of the United States of America, an amount equal to the required payment;
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provided, anything herein to the contrary notwithstanding, there shall be credited against any amounts owing to the Holders hereunder all amounts theretofore paid to the Trustee by the Guarantor pursuant to any of the Financing Documents with respect to the Bonds held by such Holders.
(b) The guaranty set forth in this Section is an absolute and irrevocable guaranty of payment and not of collectibility or performance and is in no way conditioned or contingent upon any attempt to collect from the Issuer or any other Person or to realize upon any Property subject to the Lien of the Indenture or upon any other direct or indirect security for the Bonds, or to resort to any other remedies.
(c) Each default in payment of Debt Service shall give rise to a separate cause of action hereunder and separate suits may be brought hereunder as each cause of action arises.
(d) The Guarantor hereby waives all of the following and all defenses, counterclaims, or offsets which the Guarantor may have by reason thereof: (1) notice of acceptance hereof, notice of any action taken or omitted in reliance hereon, notice of any defaults by the Issuer in the payment of any such sums, and notice of the creation, renewal, or accrual of any liability of the Issuer, (2) any presentment, demand, notice or protest of any kind, (3) any right (i) to have the Issuer joined with the Guarantor in any suit brought against the Guarantor on this Agreement, (ii) to require the Trustee or a Holder to forthwith bring suit against the Issuer on the Bonds, and (iii) to require that the Trustee or a Holder obtain any judgment against the Issuer on the Bonds in connection with the enforcement of any rights against the Guarantor hereunder, and (4) any other act or thing (including without limitation alteration of the Bonds, Letter of Credit or the Financing Documents or debt evidenced thereby or security therefor), or omission or delay to do any other act or thing which may, by operation of law or otherwise, in any manner or to any extent vary the risk of the Guarantor or which might otherwise operate as a discharge of the Guarantor.
(e) The guaranty set forth in this Section shall remain in full force and effect without reference to future changes in conditions, including, to the extent permitted by applicable law, changes in law, until all Holders shall have been indefeasibly paid in full all sums due under the terms and provisions of the Bonds and the Lease Agreement notwithstanding any terms or provisions contained in the Bonds (including any discharge or termination of the Indenture as a result of deposits being made with the Trustee), and until such sums are not subject to rescission or repayment upon any bankruptcy, insolvency, arrangement, reorganization, moratorium, receivership or similar proceeding affecting the Issuer or the Guarantor.
SECTION 2.02 INDEMNIFICATION AGAINST INVALIDITY
(a) If, at any time and for any reason whatsoever, an Adjudication of Invalidity (as defined hereinafter) shall have been made, the Guarantor hereby agrees to indemnify and save the Holders harmless from the consequences of such an event by purchasing the Bonds at a price equal to the
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outstanding principal amount thereof plus interest accrued thereon to the date of the purchase. A purchase will be made within thirty days after receipt by the Guarantor of a written request from a Holder, which written request shall specify that an Adjudication of Invalidity has occurred. The Guarantor shall be obligated to make such purchase without the necessity of any showings or proofs on the part of a Holder that such Holder has suffered any losses or damages (such losses and damages being conclusively presumed upon the occurrence of an Adjudication of Invalidity). The term "ADJUDICATION OF INVALIDITY" shall mean either (i) a final, unappealable adjudication by any court of competent jurisdiction, binding upon the Guarantor or the Issuer (or any of them), or if not binding upon the Guarantor or the Issuer (or any of them), applicable to the Bonds in the unqualified Opinion of Bond Counsel satisfactory to the Trustee, such opinion being in form and substance reasonably satisfactory to the Guarantor, that, under the constitution or general laws of the State of Alabama, the Issuer or the Trustee or the Credit Obligor lacked authority to do any one or more of the following at the time any one of the following was done: (a) issue the Bonds, (b) enter into the Indenture, (c) issue the Letter of Credit, or (d) enter into the Lease Agreement; or (ii) a final, unappealable adjudication by any such court that the Bonds (or, on a ground applicable to the Bonds, that any other obligations) are otherwise invalid for any other reason whatsoever, including, without limitation, any invalidity or irregularity in any statutory, judicial or other proceedings relating to the formation or existence of the Issuer, relating to the issuance of the Bonds or the Letter of Credit or relating to the execution and delivery of any of the Financing Documents. The obligation to purchase the Bonds in the event of an Adjudication of Invalidity shall apply even though the Bonds or a part thereof may have been called for redemption and shall apply even after the date set for redemption if the Bonds shall not yet have been redeemed. The Guarantor shall give or cause to be given at their expense to the Trustee prompt written notice of any Adjudication of Invalidity of which the Guarantor may become aware, and the Trustee shall give written notice of such Adjudication of Invalidity to the Holders.
(b) No purchase of the Bonds by the Guarantor pursuant to this Section shall relieve the Guarantor of its obligation to pay Basic Rental Payments upon the occurrence of a Determination of Taxability.
(c) Whether or not there is an Adjudication of Invalidity and in addition to the foregoing, the Guarantor hereby agrees to indemnify and save each Holder and the Trustee harmless from and against all damage, loss, cost or expense (including reasonable attorneys' fees) which any Holder or the Trustee may incur or be subject to as a consequence, direct or indirect, of (1) such Adjudication of Invalidity, (2) any breach by the Guarantor or the Issuer (or any of them) of any representation, warranty, covenant, term or condition in, or the occurrence of any default or any Event of Default under any Financing Document, the Letter of Credit, or the Bonds, together with all reasonable expenses resulting from the compromise or defense of any claims or liabilities arising as a result of any such breach or default or Event of Default, (3) any legal action commenced to challenge the validity of any of the Financing Documents, the Letter of Credit or the Bonds, and (4) any other cause relating to any of the Financing Documents, the Letter of Credit or the Bonds. The Guarantor shall be obligated to make the payments described in this paragraph only after receipt from a Holder of written notice requesting that such payments be
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made, identifying the reason for such payments and specifying the amounts to be paid. The Guarantor shall make such payments to the Holder within thirty days after receipt of such notice.
(d) The obligations of the Guarantor under this Section constitute original undertakings on the part of the Guarantor, are not collateral to the obligations of the Issuer or any other person or entity with respect to the Bonds, and are independent, separate and apart from the guaranty obligations of the Guarantor set forth under Section 2.01.
SECTION 2.03 CHARACTER OF OBLIGATIONS HEREUNDER
(a) All obligations of the Guarantor under this Agreement are unconditional, primary, absolute and irrevocable under any and all circumstances. Without limiting the generality of the foregoing, to the fullest extent permitted under applicable law, the obligations of the Guarantor hereunder shall not be subject to or impaired by:
(i) any inability or failure on the part of any party thereto to
perform or comply with the Letter of Credit, the Financing Documents or
the Bonds;
(ii) any invalidity or irregularity in any statutory or other
proceedings relating to the formation or existence of the Issuer, to the
issuance of the Bonds or to the execution and delivery of any Financing
Document;
(iii) any invalidity or unenforceability of, or any impairment,
modification or release of liability of any party under, or any
impossibility, impracticability, illegality or frustration of
performance by any party of, the Letter of Credit, the Financing
Documents or the Bonds, for any reason whatsoever, including, without
limitation, any decision by any court invalidating or otherwise
affecting the obligations of any party under or in connection with the
Letter of Credit, the Financing Documents or the Bonds;
(iv) any inability or failure on the part of the Guarantor to
perform or comply with the Lease Agreement;
(v) any invalidity or unenforceability of, or any impairment,
modification or release of liability of the Guarantor under, or any
impossibility, impracticability, illegality or frustration of
performance by the Guarantor of this Agreement;
(vi) the voluntary or involuntary liquidation, dissolution,
merger, consolidation, sale or other disposition of all or substantially
all of the assets, marshalling of assets and liabilities, receivership,
insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, moratorium, arrangement, composition with creditors or
readjustment of debt of, or other similar proceedings affecting, the
Issuer (including any payments to be received by the Issuer under the
Lease Agreement in connection with any of the aforementioned proceedings
or events), the Credit Obligor or the Guarantor;
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(vii) any waiver, consent, extension, indulgence or other action
or inaction in respect of the Letter of Credit, any Financing Document,
or the Bonds, including any modification, amendment or supplement to any
of the foregoing, the renewal or extension of the Bonds, the release of
any Property subject to the Lien of the Indenture or the Lease Agreement
or any other similar act;
(viii) any right of setoff, counterclaim or defense, or any act,
omission or breach on the part of the Issuer, the Credit Obligor or the
Guarantor;
(ix) any claim whatsoever against the Issuer;
(x) any defect in the title, compliance with specifications,
value, condition, design, operation, merchantability, quality,
durability or suitability of, consequences of use or misuse of, or
unfitness for use of, the Project or any part thereof, any abandonment,
destruction, noncompletion, requisition, condemnation, foreclosure of or
damage to the Project or any part thereof, or any event of FORCE MAJEURE
relating to the Project or any part thereof;
(xi) any breach of any representation or warranty relating to the
Bonds or the Project;
(xii) any release, extinguishment or satisfaction of the Issuer's
obligations to make payments of Debt Service until there have been paid
to the Trustee or the Holders in lawful currency of the United States an
amount sufficient to pay all Debt Service (including interest on overdue
amounts of Debt Service including, to the extent permitted by applicable
law, interest) that would have been due and owing to the Holders by the
Issuer had the Issuer's obligations not been so released, extinguished
or satisfied;
(xiii) the failure to give notice to the Guarantor of the
occurrence of any default or event of default under the Bonds, the
Letter of Credit or the Financing Documents;
(xiv) the compromise, settlement, release or termination of any
or all of the obligations, covenants or agreements of any of the parties
to any of the Financing Documents (the "FINANCING PARTICIPANTS") under
the Bonds, the Letter of Credit or the Financing Documents;
(xv) any assignment, pledge or mortgage of all or any part of the
interest of any of the Financing Participants in the Project or the
Trust Estate;
(xvi) any waiver of the payment, performance or observance by any
of the Financing Participants of any obligation, agreement or covenant
of any of them contained in the Bonds, the Letter of Credit or the
Financing Documents;
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(xvii) the extension of the time for payment of Debt Service on
the Bonds or any part thereof or of the time for performance of any
other obligations, agreements or covenants of any of the Financing
Participants under the Bonds, the Letter of Credit or the Financing
Documents;
(xviii)the modification or amendment (whether material or
otherwise) of any obligation, agreement or covenant contained in the
Bonds, the Letter of Credit or the Financing Documents;
(xix) any failure, omission, or delay on the part of any of the
Financing Participants to enforce, assert or exercise any right, power
or remedy conferred upon any of them by the Bonds, the Letter of Credit
or the Financing Documents;
(xx) the bankruptcy, insolvency, reorganization, appointment of a
receiver for, or dissolution of any of the Financing Participants, or
the entering by any or all of them into an agreement of composition with
creditors, or the making by any or all of them of an assignment for the
benefit of creditors;
(xxi) any rights of set-off, recoupment, counterclaim or other
defense, whether similar or dissimilar to the foregoing, which the
Guarantor might otherwise have against any of the Financing Participants
or any other person;
(xxii) the default or failure of any one or more of the Financing
Participants to perform fully any obligation, covenant or agreement
contained in the Bonds, the Letter of Credit or the Financing Documents;
(xxiii)the release or discharge of any one or more of the
Financing Participants by operation of law, to the extent that such
release or discharge may be lawfully avoided, from the performance or
observance of any agreement or covenant contained in the Bonds, the
Letter of Credit or the Financing Documents;
(xxiv) the invalidity or unenforceability of the Bonds, the
Letter of Credit or the Financing Documents or of any provision of such
instruments.
(b) The Guarantor acknowledges that this Agreement is executed for the benefit of the Holders and the Trustee and that the Bonds will be purchased in reliance on this Agreement. No act of commission or omission of any kind at any time on the part of the Trustee or any Holder in respect of any matter whatsoever shall in any way affect or impair any right, power or benefit of the Trustee, or any Holder under this Agreement and, to the extent permitted by applicable law, no setoff, claim, reduction, diminution of any obligation, or any defense of any kind or nature which the Guarantor may have against the Trustee or any Holder, shall be available against the Trustee or any Holder in any suit or action brought by the Trustee or any Holder to enforce any right, power or benefit under this Agreement. Any conflict or ambiguity between this Agreement
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and the other Financing Documents shall be interpreted and determined in the manner most favorable to the Trustee and the Holders.
ARTICLE III
DETERMINATION OF TAXABILITY
SECTION 3.01 PAYMENTS BY THE GUARANTOR
In connection with a Determination of Taxability, the Guarantor agrees to pay, in addition to the amounts specified in the Bonds and in the Lease Agreement, the reasonable fees and expenses of the Trustee incurred in connection therewith.
SECTION 3.02 NO OBLIGATION TO CONTEST OR APPEAL
No Holder shall have any duty to make any contest of such a Determination of Taxability or to pursue any appeal of, or have any communication with the Internal Revenue Service concerning, such Determination of Taxability.
ARTICLE IV
BUSINESS COVENANTS
SECTION 4.01 AFFIRMATIVE COVENANTS
The Guarantor covenants that so long as this Agreement is in effect, the Guarantor shall
(a) EXISTENCE, PROPERTIES, ETC. (i) Do or cause to be done all things necessary to preserve and keep in full force and effect the legal existence of the Guarantor and all privileges, rights and franchises and comply with all laws where failure to so comply would have a Material Adverse Effect; (ii) at all times maintain, preserve and protect all of its property used or useful in the conduct of its business where the failure to so maintain, preserve and protect would have a Material Adverse Effect, and keep the same in good repair, working order and condition, and from time to time make, or cause to be made, all necessary and proper repairs, renewals and replacements, betterments and improvements thereto so that (a) the business carried on in connection therewith may be properly and advantageously conducted at all times and (b) the failure to so repair or replace would not have a Material Adverse Effect; (iii) at all times keep its insurable properties adequately insured and maintain, where the failure to so keep and maintain would have a Material Adverse Effect, (a) insurance to such extent and against such risks, including fire, as is customary with companies in the same or similar business, (b) necessary worker's compensation insurance, and (c) such other insurance as may be required by law or as
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may be reasonably required in writing by the Trustee; and (iv) cause the Credit Obligor to be named as loss payee on each of said policies relating to the Project.
(b) PAYMENT OF INDEBTEDNESS, TAXES, ETC. (i) Pay all of its indebtedness and obligations promptly and in accordance with normal terms where failure to pay would have a Material Adverse Effect, and (ii) pay and discharge or cause to be paid or discharged promptly all taxes, assessments and governmental charges or levies imposed upon it or upon its income and profits, or upon any of its Property, real, personal or mixed, or upon any part thereof, before the same shall become in default, as well as all lawful claims for labor, materials and supplies or otherwise, which, if unpaid, might become a lien upon such properties or any part thereof where failure to pay would have a Material Adverse Effect; provided, however, that the Guarantor shall not be required to pay and discharge any such tax, assessment, charge, levy or claim so long as the validity thereof shall be contested in good faith by appropriate proceedings and the Guarantor shall have set aside on its books adequate reserves with respect to any such tax, assessment, charge, levy or claim so contested.
(c) FURTHER ASSURANCES. On request of the Trustee, promptly correct any defect, error or omission which may be discovered in the contents of any of the papers executed in connection with the Bonds or in the execution or acknowledgement thereof, and execute, acknowledge and deliver such further instruments and do such further acts as may be necessary or as may be requested by the Trustee to carry out more effectively the purposes of this Agreement and the papers executed in connection with the Bonds.
SECTION 4.02 INFORMATION AS TO GUARANTOR
FINANCIAL AND BUSINESS INFORMATION. The Guarantor shall deliver to the Trustee:
(a) NOTICE OF DEFAULT OR EVENT OF DEFAULT. Immediately upon becoming aware of the existence of any condition or event which constitutes a default or an event of default under any Financing Document, a written notice specifying the nature and period of existence thereof and what action the Guarantor is taking or proposes to take with respect thereto;
(b) NOTICE OF CLAIMED DEFAULT. Immediately upon becoming aware that a Holder or the holder of any evidence of indebtedness or other security of the Guarantor has given notice or taken any other action with respect to a claimed default or event of default thereunder which would cause a default or event of default which would have a Material Adverse Effect, a written notice specifying the notice given or action taken by such holder and the nature of the claimed default or event of default and what action the Guarantor are taking or proposes to take with respect thereto;
(c) REQUESTED INFORMATION AND AUDITS. With reasonable promptness, such financial and other data and information as from time to time may be reasonably requested;
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(d) NOTICE OF LITIGATION. Immediately upon becoming aware of the existence of any proceedings before any Tribunal involving the Guarantor which involves the probability of any final judgment or liability against such Guarantor in an amount which would have a Material Adverse Effect, a written notice specifying the nature thereof and what action such Guarantor is taking and proposes to take with respect thereto; and
(e) NOTICE FROM REGULATORY AGENCIES. Promptly upon receipt thereof, information with respect to and copies of any notices received from federal or state regulatory agencies or any Tribunal relating to an order, ruling, statute or other law or information which might have a Material Adverse Effect on the franchises, permits, licenses, or rights, or the condition, financial or otherwise, of the Guarantor.
ARTICLE V
REPRESENTATIONS, WARRANTIES AND AGREEMENTS
The Guarantor represents, warrants and agrees that:
SECTION 5.01 NO MATERIAL ADVERSE EFFECT
Since the date of application to the Credit Obligor for the loan represented by the Letter of Credit, (i) there has been no change in the business, prospects, profits, Properties or condition (financial or otherwise) of the Guarantor, except changes in the ordinary course of business, none of which individually or in the aggregate has a Material Adverse Effect, (ii) the Guarantor has not incurred any material liability which has a Material Adverse Effect, and (iii) there exists no default under the provisions of any instrument evidencing any such liabilities or under any agreement relating thereto which would have a Material Adverse Effect.
SECTION 5.02 FULL DISCLOSURE
No written statement furnished by the Guarantor to the Trustee contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained therein or herein not misleading. There is no fact which the Guarantor has not disclosed to the Trustee in writing which has a Material Adverse Effect or, so far as the Guarantor can now foresee, will have a Material Adverse Effect.
SECTION 5.03 PENDING LITIGATION
To the Guarantor's knowledge, there are no proceedings pending, or to the knowledge of the Guarantor threatened, against or affecting the Guarantor in any court or before any governmental authority or arbitration board or Tribunal which involve the possibility of a Material Adverse Effect, or the ability of the Guarantor to perform this Agreement or to perform the Lease
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Agreement. The Guarantor is not in default with respect to any order of any court, governmental authority, arbitration board or Tribunal which would have a Material Adverse Effect.
SECTION 5.04 TITLE TO PROPERTIES
Except as set forth in the Indenture, the Issuer has good and marketable title in fee simple to the Project.
SECTION 5.05 NO DEFAULTS
No event has occurred and no conditions exist which would, in any material respect, upon the issuance of the Bonds, constitute (i) a default under any note or other evidence of indebtedness or under any agreement of the Guarantor if the effect of such default would have a Material Adverse Effect or (ii) a default or event of default under the Financing Documents or any of them, and the Guarantor is not in violation in any material respect of any term of any agreement or other instrument to which it is a party or by which it may be bound that would have a Material Adverse Effect.
SECTION 5.06 GOVERNMENTAL CONSENT
No consent, approval or authorization of, or filing, registration or qualification with, any governmental authority on the part of the Guarantor is required in connection with the execution and delivery of the Financing Documents to which the Guarantor is a party.
SECTION 5.07 USE OF PROCEEDS
The Guarantor will cause the proceeds from the sale of the Bonds to be applied as provided in the Indenture. Non...
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