Exhibit 10.3


 


ENVIRONMENTAL AGREEMENT


 


This Environmental Agreement is made this 16th day of December, 2005,
by and between ALTRIA CORPORATE SERVICES,
INC. (f/k/a PHILIP MORRIS MANAGEMENT CORP.), a New York corporation
(“Altria”) and KRAFT FOODS GLOBAL, INC.(“Kraft”),
a Delaware corporation.


 


W I T N E S S
E T H


 


WHEREAS, Altria and Milwaukee County, Wisconsin, are parties to that
certain Lease Agreement, dated July 14, 1980, Airport Agreement No. HP-695,
as amended by Amendment No. 1 to Airport Lease Agreement No. HP-695
as of December 31, 1995 and Amendment No. 2 to Airport Lease
Agreement No. HP-695 as of December 16, 2005 (the “Original Lease”)
with respect to certain property (the “Property”) located at General Mitchell
International Airport (“Airport”); and


 


WHEREAS, Altria and Kraft are parties to the certain Purchase and Sale
Agreement (“PSA”) dated December 15, 2005, by which Altria agreed to sell
and transfer to Kraft, and Kraft agreed to purchase and accept from Altria, all
of Altria’s rights, title and interests in the Original Lease and certain other
property described in the PSA on the terms and conditions set forth therein;
and


 


WHEREAS, Altria, Kraft, and Milwaukee County, Wisconsin, are parties to
that certain Assignment of Lease dated December 16, 2005, (“Date of
Assignment”) by which Altria assigned and transferred all right, title, and
interest of Altria in and to the Original Lease to Kraft and by which Kraft
accepted such assignment and agreed to perform, observe, and accept all such
obligations, covenants and conditions contained in the Original Lease on the
part of Altria from and after the Date of Assignment; and


 


WHEREAS, Altria and Kraft are parties to that certain Management
Agreement dated December 16, 2005 (the “Management Agreement”) by which
Altria has agreed to maintain and operate the Property for the purposes for
which it is intended on the terms and conditions set forth therein; and


 


WHEREAS, Altria and Kraft seek to define and allocate responsibility
for certain environmental matters pertaining to the Property as set forth in
this Agreement even though other representations, warranties, rights and
obligations contained in the PSA will not survive after the effective date of
the PSA or will expire within a fixed period of time thereafter; and


 


WHEREAS, Altria and Tennessee Gas Pipeline Company, a Delaware
corporation (successor by name change to Tenneco Inc.) (“Tenneco”), which
occupied the Property before Altria, are parties to that certain Agreement,
dated December 29, 1995, as amended by Letter Agreement No. 1 as of December 29,
1995 and Letter Agreement No. 2 Airport Lease Agreement as of December 31,
1995 (collectively the “Tenneco Agreement”); and


 


WHEREAS, Altria and Kraft seek to define and set forth the assignment
of certain rights and obligations under the Tenneco Agreement from Altria to
Kraft.


 





















 


NOW, THEREFORE, in consideration of the foregoing premises and of the
mutual covenants, representations and warranties herein set forth, the parties
hereto hereby covenant and agree as follows:


 


1.                                       Environmental
Responsibility.


 


A.                                   Altria
shall be responsible for all conditions, releases or discharges on the Property
involving any hazardous or toxic substances, materials, or wastes including,
without limitation, petroleum, as these terms are used or defined in applicable
local, state or federal environmental laws and regulations (collectively “hazardous
or toxic materials”) (1) first occurring from September 1, 1993, to December 16,
2005, (2) relating to or originating from conditions that first existed
from September 1, 1993, to December 16, 2005, or (3) relating to
such further cleanup of UST #5 as may be required, if at all, under the
Original Lease or the Assignment of Lease dated December 16, 2005.  Except as provided for in Paragraph 1.B.
below, Kraft shall be responsible for other conditions, releases or discharges
involving any hazardous or toxic materials on the Property as may first occur
on and after December 16, 2005.


 


B.                                     Altria
shall also be responsible for all conditions, releases or discharges on the
Property involving any hazardous or toxic materials caused by the willful
misconduct of Altria and its employees during the term of the Management
Agreement, except to the extent such acts are directed by Kraft, its employees,
or contractors.


 


C.                                     Kraft will maintain in
full force and effect, at its own expense, any financial instruments necessary to comply with the requirements of
subpart H of 40 CFR part 280 and the corresponding applicable state regulations
including, without limitation, Wisconsin Admin Code ch. Comm 10, subchapter
VIII, regarding Kraft’s financial responsibility for taking corrective action
and for compensating third parties for bodily injury and property damage caused
by accidental releases from the operation of petroleum underground storage
tanks.


 


2.                                       Indemnification
as to Environmental Matters.


 


A.                                   Altria
shall indemnify and hold harmless Kraft from and against any and all claims,
demands, damages, losses, costs and expenses, including without limitation,
court costs and reasonable attorney’s fees, arising from (1) any
violations by Altria of laws, orders, rules, regulations, requirements,
guidelines or demands of any local, state or federal governmental agency or
other authority based upon applicable environmental laws relating to the
Property and occurring on or before the date hereof, and (2) all
conditions, releases or discharges involving any hazardous or toxic materials
on the Property (a) first occurring from September 1, 1993, to December 16,
2005, relating to or originating from conditions that first existed from September 1,
1993, to December 16, 2005, or relating to such further cleanup of UST #5
as may be required, if at all, under the Original Lease or the Assignment of
Lease dated December 16, 2005, or (b) caused by the willful
misconduct of Altria, its employees and contractors, during the term of the
Management Agreement, except to the extent such acts are directed by Kraft, its
employees, or contractors.


 


B.                                     Kraft
shall indemnify and hold harmless Altria from and against any and all claims,
demands, damages, losses, costs and expenses, including without limitation,
court 


 





















 


costs
and reasonable attorney’s fees, arising from (1) any violations by Kraft
of laws, orders, rules, regulations, requirements, guidelines or demands of any
local, state of federal governmental agency or other authority based upon
applicable environmental laws relating to the Property and occurring on or
after the date hereof, and (2) all conditions, releases or discharges
involving any hazardous or toxic materials on the Property first occurring on
or after December 16, 2005, except to the extent caused by the willful
misconduct of Altria and its employees during the term of the Management
Agreement (unless such acts are directed by Kraft, its employees, or
contractors).


 


3.                                       Defense
of Action.  In the case of any action
or proceeding brought against Altria or Kraft, as the case may be, by reason of
any such claim indemnified against pursuant to this Agreement, upon notice, the
other party shall defend the action or proceeding by counsel reasonably
acceptable to the other.  This
requirement is conditioned upon receipt by the indemnifying party of timely
written notice of, and the opportunity to defend, any such claims and upon the
cooperation of the party against whom the claim is made in the defense of such
claim.  Timely written notice for
purposes of this Paragraph means written notice within fourteen (14) days of
receipt of any written claim, demand, legal process or paper relating to such
claim provided, however, that, in an action to enforce the indemnity, late
notice will not be a defense absent a showing of prejudice to the indemnitor.


 


4.                                       Assignment
of Rights Against Tenneco.


 


A.                                   Altria
hereby assigns and transfers to Kraft all the rights and interests of Altria in
and to the Tenneco Agreement.


 


B.                                     Kraft
hereby accepts said assignment and agrees to perform, observe, and accept all
the obligations, covenants and conditions on Altria contained therein to be
performed and observed from and after the date hereon.


 


5.                                       Responsibility
for Site Work.


 


A.                                   Stormwater
Discharge.  Altria shall take such action
as may be required to obtain a general WPDES permit for the lawful discharge of
water from the sump pump associated with the fuel farm along East College
Avenue to the storm sewer.  This
obligation shall terminate upon receipt of the applicable permit.


 


B.                                     UST
#5.  Altria shall take such action as may
be required to achieve closure of the WDNR file on UST #5, including but not
limited to assuring that (1) necessary well abandonment forms are filed
with WDNR and (2) an adequate deed restriction is recorded (with proof of
recording filed with WDNR).  This
obligation shall terminate upon confirmation that WDNR has closed its file on
this matter.


 


6.                                       Entire
Agreement; Headings; Counterparts. 
This Agreement constitutes the entire agreement and understanding of the
parties hereto with respect to the subject matter hereof and supersedes all
prior negotiations and understandings, whether written or oral, of the parties
hereto with respect to the subject matter hereof, including, but not limited
to, any language in or interpretation of the PSA contrary to the terms of this
Agreement.  The headings in this
Agreement are for the purposes of reference only and shall not limit or
otherwise affect the 


 





















 


meaning
hereof.  This Agreement may be executed
and delivered by the parties hereto in one or more counterparts, each of which
shall be an original but all of which together shall constitute one instrument.


 


7.                                       Binding
Affect.  This Agreement is binding
upon and inures to the benefit of the parties hereto and their respective
successors and assigns.


 


8.                                       Applicable
Law.  This agreement shall be
governed and construed in accordance with the laws of the State of Wisconsin.


 


9.                                       Facsimile
Signatures.  Altria and Kraft agree
that signatures on documents delivered by facsimile transmission shall be
binding on all parties, and respectively agree to provide an originally signed
copy of any document delivered by facsimile within five (5) days after
such delivery.


 


10.                                 Counterparts.  This agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.


 





















 


IN WITNESS WHEREOF, the parties hereto have caused this Environmental
Agreement to be executed as of the date first above written.


 


 


	
   

  	
  ALTRIA
  CORPORATE SERVICES, INC. f/k/a

  PHILIP MORRIS MANAGEMENT CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George
  Saling

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  KRAFT FOODS
  GLOBAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bruce
  Windedahl