<PAGE>
EXHIBIT 10.5
LOAN NO.: 94-0950936
ENVIRONMENTAL INDEMNITY AGREEMENT
THIS
ENVIRONMENTAL INDEMNITY AGREEMENT (the "Indemnity") is entered into
as
of September 9, 2005, by the undersigned
TABB Realty, LLC, a Michigan limited
liability company ("Borrower") in favor of
PNC Bank, National Association
("Lender").
RECITALS:
A.
Contemporaneously with this Indemnity, Borrower has executed
and
delivered its Promissory Note (the "Note")
to Lender evidencing Lender's loan to
Borrower in the amount of $100,000,000.00
(the "Loan").
B. The Note is
secured by, among other security: (i) the Security
Instruments (as defined in the Note), which
Security Instruments encumber the
property described therein (the "Mortgaged
Property") and including, without
limitation, the real property more
particularly described in Exhibit A attached
hereto, and the Other Security Documents
(as defined in the Security
Instruments). The Note, the Security
Instruments and the Other Security
Documents are hereinafter collectively
referred to as the "Loan Documents".
C. As a
condition to making the Loan, Lender has required that Borrower
indemnify Lender with respect to the
matters set forth herein.
NOW, THEREFORE,
in consideration of the foregoing, of Lender making the
Loan and other valuable consideration, the
receipt and adequacy of which is
hereby acknowledged, Borrower agrees as
follows:
1. Certain
Defined Terms. Unless otherwise expressly herein provided, each
defined term in this Indemnity, as
indicated by the initial capitalization
thereof, shall have the meaning set forth
in the Loan Documents. As used herein,
the singular shall include the plural and
the masculine shall include the
feminine and neuter and vice versa, if the
context so requires. The following
terms shall have the following
meanings:
(a) "Affiliates"
the respective successors, assigns and participants,
parent, subsidiary and affiliated
corporations and entities of any Borrower, and
the respective partners, directors,
officers, agents, attorneys and employees of
each of the foregoing.
(b) "CERCLA"
means the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980 (42 U.S.C.
Section 9601 et seq.), as heretofore or
hereafter amended from time to time.
(c)
"Environmental Laws" means all present and future laws (whether
common
law, statute, rule, regulation or
otherwise), permits and other requirements of
governmental authorities relating to the
environment or to any Hazardous
Material or Hazardous Material Activity,
including, without limitation, CERCLA;
the Hazardous Materials Transportation Act;
the Resource Conservation and
Recovery Act; the Toxic Substance Control
Act; the Clean Air Act; the Federal
Water Pollution Control Act; the Hazardous
Substance Control Act; the Emergency
Planning and Community Right to Know Act;
the Occupational Safety
MCF 415
EIA
Last revised 7/5/05
1
<PAGE>
and Health Act; the Underground Tank Act of
1984; any so-called "Super-Fund" or
"Super-Lien" law, or any other federal,
state or local statute, law, ordinance,
code, rule, regulation, order or decree
regulating, relating to, or imposing
liability or standards of conduct
concerning any hazardous, toxic or dangerous
waste, substance or material, as of now or
at any time hereafter in effect.
(d)
"Environmental Report" shall mean the following Phase I
Environmental
Site Assessments prepared for each property
comprising the Mortgaged Property in
favor of Lender:
(1) 500 N. Dunham,
Dundee, Michigan prepared by EBI dated July 19,
2005;
(2) 1351 Hix Road,
Westland, Michigan prepared by EBI dated July 18,
2005;
(3) 3310 W.
Springfield, Champaign, Illinois prepared by EBI dated
July 19, 2005;
(4) 108 Industrial
Drive, East Longmeadow, Massachusetts prepared by
EBI dated July 14, 2005
(5) 435 Rousch Road,
Lima, Ohio prepared by AEC dated July 12, 2005;
(6) 850 W. Smith Road,
Medina, Ohio prepared by AEC dated July 14,
2005;
(7) 18015 St. Route
65, Jackson Center, Ohio prepared by AEC July 14,
2004;
(8) 300 Washington
Street, Jackson Center, Ohio prepared by AEC dated
July 14, 2005;
(9) 3201 Miller Park
North, Garland, Texas prepared by RCI dated July
22, 2005;
(10) 222 & 213 Kerry Street and 313, 215 & 217 E.
Wallisville Road,
Highlands, Texas prepared by RCI dated July 25, 2005;
(11) 4211 Amberjack Blvd., Plant City, Florida prepared by EBI
dated
July 19, 2005;
(12) 7150 Jefferson Metropolitan Parkway, McCalla, Alabama prepared
by
AEC dated July 14, 2005;
(13) 4101 Pardue Road, Pineville, Louisiana prepared by RCI dated
July
25, 2005; and
(14) 41605 Ann Arbor Road, Plymouth, Michigan prepared by EBI
dated
July 22, 2005
(e) "Foreclosure
Transfer" means the transfer of title to all or any part
of the Mortgaged Property in connection
with a foreclosure of the Security
Instruments, including, without limitation,
a sale pursuant to judicial decree
or power of sale, or by deed in lieu of
such foreclosure.
(f) "Hazardous
Material" means, at any time: (I) any substance that is then
defined or listed in, or otherwise
classified, designated or regulated pursuant
to any applicable Environmental Laws as a
"hazardous substance", "hazardous
material", "hazardous waste", "infectious
waste", "toxic substance", "toxic
pollutant" or any other formulation
intended to define, list, or classify
substances by reason of deleterious
properties such as
MCF 415
EIA
Last revised 7/5/05
2
<PAGE>
radioactivity, ignitability, corrosivity,
reactivity, carcinogenicity, toxicity,
explosiveness, reproductive toxicity or "EP
toxicity"; (ii) any petroleum and
petroleum byproducts, drilling fluids,
produced waters and other wastes
associated with the exploration,
development or production of crude oil, natural
gas or geothermal resources; (iii) asbestos
and polychlorinated biphenyls; and
(iv) any other material or substance,
naturally occurring or otherwise, which
causes or poses a threat to cause a
contamination or nuisance on the Mortgaged
Property or any adjacent property or a
hazard to the environment or to the
health or safety of persons on the
Mortgaged Property or any adjacent property.
(g) "Hazardous
Material Activity" means any actual, proposed or threatened
storage, holding, existence, release,
emission, discharge, generation,
processing, abatement, removal,
disposition, handling or transportation of any
Hazardous Material from, under, into or on
the Mortgaged Property or surrounding
property.
(h) "Borrower"
means any person or entity executing this Indemnity, and
their respective successors and
assigns.
(I) "Lender"
means Lender, any person or entity that may acquire the
Mortgaged Property in connection with any
Foreclosure Transfer and their
respective successors, assigns and
participants, parent, subsidiary and
affiliated corporations and entities, and
the respective partners, directors,
officers, agents, attorneys and employees
of each of the foregoing.
(j) "Losses"
means any and all losses, liabilities, damages, demands,
claims, actions, judgments, causes of
action, assessments, penalties, costs and
expenses (including, without limitation,
all fees and costs of any attorneys and
accountants, including on appeal and in any
bankruptcy case or proceeding) and
all consequential damages.
(k)
"Environmental Losses" means Losses suffered or incurred by
Lender
arising out of or as a result of: (I) any
breach of any representation,
warranty, covenant or agreement contained
herein; (ii) the occurrence of any
Hazardous Material Activity prior to a
Foreclosure Transfer; (iii) any violation
of any applicable Environmental Laws
relating to the Mortgaged Property or the
ownership, use, maintenance, occupancy or
operation thereof prior to a
Foreclosure Transfer; (iv) any
investigation, inquiry, order, hearing, action,
or other proceeding by or before any
governmental agency in connection with any
Hazardous Material Activity occurring or
allegedly occurring prior to a
Foreclosure Transfer; or (v) any claim,
demand or cause of action, or any action
or other proceeding, whether meritorious or
not, brought or asserted against
Lender to the extent directly or indirectly
relating to, arising from or based
on any of the matters described in clauses
(I), (ii), (iii) or (iv) above, or
any allegation of any such matters.
2. Indemnity.
Borrower hereby assumes liability for and agrees to pay,
protect, indemnify, defend and hold
harmless Lender from and against any and all
Environmental Losses, excluding any such
losses arising from Lender's gross
negligence or willful misconduct. A
separate right of action hereunder shall
arise each time Lender acquires knowledge
of any matter indemnified by Borrower
under this Indemnity. Separate successive
actions may be brought hereunder to
enforce any of the provisions hereof at any
time and from time to time. No
action hereunder shall preclude any
subsequent action, and Borrower hereby
waives and covenants not to assert any
defense in the nature of splitting of
causes of action or merger or judgments.
Each person or party executing the
Indemnity agrees that the liability
hereunder shall be joint and several.
3. Covenants and
Representations. Borrower hereby represents and warrants
to Lender that, to
MCF 415
EIA
Last revised 7/5/05
3
<PAGE>
the best of its knowledge, after due
inquiry and investigation, the Mortgaged
Property is not subject to any private or
governmental lien or judicial or
administrative notice or action relating to
any Hazardous Material; and except
as disclosed to Lender in the Environmental
Report: (a) the Mortgaged Property
is not in violation of any Environmental
Laws; (b) no Hazardous Material is
present at the Mortgaged Property; (c) no
Hazardous Material has been
discharged, generated, treated, disposed of
or stored on, incorporated in, or
removed or transported from the Mortgaged
Property otherwise than in compliance
with all Environmental Laws; and (d) no
underground storage tanks exist on any
of the Mortgaged Property. Until a
Foreclosure Transfer, Borrower shall keep the
Mortgaged Property free from Hazardous
Material and in compliance with all
Environmental Laws. Borrower shall notify
Lender within five (5) business days
after it becomes aware of the existence of
any Hazardous Material on, or any
alleged or actual violation of any
Environmental Laws with respect to, the
Mortgaged Property. Borrower shall remove
any such Hazardous Material and/or
cure any such violations, as applicable, as
required by law, promptly after it
becomes aware of same, at its sole expense.
Nothing herein shall prevent
Borrower from recovering such expenses from
any other party (excluding Lender)
that may be liable for such removal or
cure. If, at any time and from time to
time until the occurrence of a Foreclosure
Transfer, Lender has reasonable cause
to believe that Borrower has violated, or
permitted any violations, any breach
of the foregoing, then Borrower shall
provide, at its sole expense, an
inspection or audit of the Mortgaged
Property prepared by a licensed
hydrogeologist or licensed environmental
engineer approved by Lender indicating
the presence or absence of Hazardous
Material on, or violation of Environmental
Laws at the Mortgaged Property. If Borrower
fails to provide such inspection or
audit within thirty (30) days after such
request, Lender may order same, and
Borrower hereby grants to Lender and its
employees and agents access to the
Mortgaged Property to undertake such
inspection or audit. The cost of such
inspection or audit shall be immediately
due and payable, shall be added to the
Debt (as defined in the Note) and shall
bear interest at the Default Rate from
the date expended by Lender until paid by
Borrower.
4. Absolute
Indemnity; Waiver of Subrogation and Other Rights. This
Indemnity is absolute, unconditional,
present and continuing. It is not
conditioned or contingent upon any attempt
to enforce Lender's rights against
Borrower or the Mortgaged Property, to
collect from Borrower or any other person
or entity or upon any other condition or
contingency not set forth herein.
Lender shall have the right to proceed
against Borrower without taking any prior
action to enforce the obligations of
Borrower under the Loan Documents or the
obligations of any other indemnitor
