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EXHIBIT 10.8
MASTER LEASE AGREEMENT
No. A
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This Master Lease Agreement (the "MLA") is entered into by and between
Lucent Technologies, Inc. InterNetworking Systems ("Lessor"), having its
principal place of business at 0000 Xxxxxx Xxx Xxxxxxx, Xxxxxxx, XX 00000 and
PhoneXchange, Inc. ("Lessee"), having its principal place of business at 0000
XxxXxxxxx Xxxxx, #000, Xxxxxxx Xxxxx, XX 00000.
1. LEASE AGREEMENT. Lessor agrees to lease to Lessee, and Lessee agrees to
lease from Lessor, the equipment (the "Equipment") referenced in each of the
Schedules (the "Schedule" or "Schedules") which incorporate this MLA therein
(the "Lease"). So long as no Event of Default has occurred or is continuing,
Lessor agrees to lease to Lessee the groups of Equipment described on each
Schedule, subject to the following conditions, which Lessor in its sole
discretion may elect to waive with respect to a Schedule: (i) that in no event
shall Lessor be obligated to lease Equipment to Lessee hereunder where the
aggregate purchase of all Equipment leased to Lessee hereunder would exceed TEN
MILLION DOLLARS ($10,000,000); (ii) the Equipment leased hereunder shall only be
Equipment manufactured by either Ascend Communications, Inc or Lucent
Technologies noting that the equipment from the latter are only eligible after
the completed merger between Ascend Communication and Lucent Technologies; (iii)
that THREE MILLION DOLLARS ($3,000,000) hereunder will be available to the
Lessee for Equipment leases upon execution; (iv) that the remaining SEVEN
MILLION DOLLARS ($7,000,000) hereunder will be available to the Lessee for
Equipment leases upon Lessee providing Lessor with ONE of the following: (a)
verification that a minimum of Five Million Dollars ($5,000,000) in new equity
has been raised prior to September 30, 1999; or (b) verification that Lessee has
demonstrated cash flow (EBITDA) coverage of potential lease payments hereunder
of at lease 1.25X as measured on a rolling three month average; (v) that the
lease amount shall exclude freight, installation, maintenance, professional
services and taxes; and (vi) no new leases shall be issued after June 30, 2000.
2. TERM. Each Lease shall be effective upon the execution of the MLA and the
related Schedule by the Lessor and the Lessee. The lease term (the "Lease Term")
of the Equipment referenced in each of the Schedules shall commence on the rent
commencement date specified in each Schedule (the "Rent Commencement Date"). The
Rent Commencement Date shall be the date 30 days from the date that the
Equipment is shipped by the supplier (the "Ship Date") as evidenced by a
shipping document provided by the supplier related to the Equipment (the
"Shipping Document"). Lessor will provide Lessee with a copy of the Shipping
Document evidencing the Ship Date.
3. RENT. The rent (the "Rent") for the Equipment referenced in any Schedule
shall be as stated in such Schedule and shall be payable according to the
provisions of such Schedule. If any amount payable under a Schedule is not
received by Lessor within 10 days of the due date, Lessee agrees to pay an
Overdue Charge, as defined herein, with respect to such amount.
4. SELECTION AND ASSIGNMENT. Lessee will select the type, quantity and
Supplier (subject to above) of each item of Equipment designated in a Schedule,
and Lessee hereby assigns to Lessor all of its right, title and interest in and
to the related equipment purchase agreement, a copy of which has been provided
to Lessor by Lessee (the "Agreement"). The Agreement may be amended with the
consent of Lessor. Any such assignment with respect to Equipment shall become
binding upon Lessor when Lessor and Lessee have entered into a Lease with
respect to such Equipment and as of the Rent Commencement Date referenced in
such Lease. Upon such an assignment becoming effective, Lessor shall be
obligated to purchase the Equipment from the Supplier in accordance with the
provisions of the Agreement. It is expressly agreed that Lessee shall at all
times remain liable to Supplier under the Agreement to perform all duties and
obligations of Lessee thereunder, except for the obligation to purchase the
Equipment to the extent expressly assumed by the Lessor hereunder, and that the
Lessee shall be entitled to the same rights of the purchaser of the Equipment
under the Agreement, except such right, title and interest in the Equipment
retained exclusively by the Lessor as owner of the Equipment. Lessor shall have
no liability for a Supplier's failure to meet the terms and conditions of the
Agreement.
5. DELIVERY AND INSTALLATION. Lessee shall be responsible for payment of all
transportation, packing, installation, testing and other charges associated with
the delivery, installation or use of any Equipment which are not included in the
Agreement with respect to such Equipment.
6. WARRANTIES. LESSOR MAKES NO REPRESENTATIONS OR WARRANTY OF ANY KIND,
EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE EQUIPMENT, ITS MERCHANTABILITY,
OR ITS FITNESS FOR A PARTICULAR PURPOSE. LESSOR SHALL NOT BE LIABLE TO LESSEE OR
ANY OTHER PERSON FOR DIRECT, INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL
DAMAGES ARISING FROM LESSEE'S USE OF THE EQUIPMENT, OR FOR DAMAGES BASED ON
STRICT OR ABSOLUTE TORT LIABILITY OR LESSOR'S PASSIVE NEGLIGENCE. LESSEE HEREBY
ACKNOWLEDGES THAT ANY MANUFACTURER'S OR SUPPLIER'S WARRANTIES WITH RESPECT TO
THE EQUIPMENT ARE FOR THE BENEFIT OF BOTH LESSOR AND LESSEE. NOTWITHSTANDING THE
FOREGOING, LESSEE'S OBLIGATIONS TO PAY EACH RENT PAYMENT DUE, OR OTHERWISE
PERFORM ITS OBLIGATIONS, UNDER THIS LEASE ARE ABSOLUTE AND UNCONDITIONAL.
7. TITLE TO AND LOCATION OF EQUIPMENT. Lessor shall retain title to each item
of Equipment. Lessee, at its expense, shall protect Lessor's title and keep the
Equipment free from all claims, liens, encumbrances and legal processes. The
Equipment is personal property and is not to be regarded as part of the real
estate on which it may be situated. If requested by Lessor, Lessee will, at
Lessee's expense, furnish a landlord or mortgagee waiver with respect to the
Equipment. The Equipment shall not be removed from the location specified in the
Schedule without the written consent of Lessor. Lessee shall, upon Lessor's
request, affix and maintain plates, tags or other identifying labels, showing
Lessor's ownership of the Equipment in a prominent position on the Equipment.
8. USE OF EQUIPMENT, INSPECTION AND REPORTS. The use of the Equipment by
Lessee shall conform with all applicable laws, insurance policies, and
warranties of the manufacturer or Supplier of the Equipment. Lessor shall have
the right to inspect the Equipment at the premises where the Equipment is
located. Lessee shall notify Lessor promptly of any claims, liens, encumbrances
or legal processes with respect to the Equipment.
9. FURTHER ASSURANCES. Lessee shall execute and deliver to Lessor such
instruments as Lessor deems necessary for the confirmation of this Lease and
Lessor's rights hereunder. Lessor is authorized to file financing statements
signed only by the Lessor in accordance with the Uniform Commercial Code, or
financing statements signed by Lessor as Lessee's attorney-in-fact. Any such
filing with respect to the Equipment leased pursuant to a true lease shall not
be deemed evidence of any intent to create a security interest under the Uniform
Commercial Code.
10. MAINTENANCE AND REPAIRS. Lessee shall, at its expense, maintain each item
of Equipment in good condition, normal wear and tear excepted. Lessee shall not
make any addition, alteration, or attachment to the Equipment without Lessor's
prior written consent. Lessee shall make no repair, addition, alteration or
attachment to the Equipment which interferes with the normal operation or
maintenance thereof, creates a safety hazard, or might result in the creation of
a mechanic's or materialman's lien.
11. LESSOR'S PERFORMANCE OF LESSEE'S OBLIGATIONS. If Lessee fails to perform
any of its obligations under a Lease, Lessor may perform any act or make any
payment which Lessor deems necessary for the maintenance and preservation of the
Equipment subject thereto and Lessor's title thereto. All sums so paid by Lessor
(together with all related Overdue Charges), and reasonable attorneys' fees
incurred by Lessor in connection therewith, shall be additional rent payable to
Lessor on demand. The performance of any such act or the making of any such
payment by Lessor shall not be deemed a waiver or release of any obligation or
default on the part of Lessee.
12. INDEMNIFICATION. Lessee assumes liability for, and hereby agrees to
indemnify, protect and hold harmless, Lessor, and its agents, employees,
officers, directors, partners and successors and assigns, from and against, all
liabilities, obligations, losses, damages, injuries, claims, demands, penalties,
actions, costs and expenses, including, without limitation, reasonable
attorneys' fees, of whatever kind and nature, in contract or in tort, arising
out of the use, condition, operation, ownership, selection, delivery, leasing or
return of any item of Equipment, regardless of when, how and by whom operated,
or any failure on the part of Lessee to perform or comply with any of its
obligations under a Lease, excluding, however, any of the foregoing which result
from the gross negligence or willful misconduct of Lessor. Such indemnities and
assumptions of liabilities and obligations shall continue in full force and
effect, notwithstanding the expiration or other termination of such Lease.
Nothing contained in any Lease shall authorize Lessee to operate the Equipment
subject thereto so as to incur or impose any liability on, or obligation for or
on behalf of, Lessor.
13. NO OFF-SET. All Rents shall be paid by Lessee irrespective of any off-set,
counterclaim, recoupment, defense or other right which Lessee may have against
Lessor, the manufacturer or Supplier of the Equipment or any other party.
14. ASSIGNMENT BY LESSEE. Lessee shall not, without Lessor's prior written
consent, (a) sell, assign, transfer, pledge, hypothecate, or otherwise dispose
of, encumber or suffer to exist a lien upon or against, any of the Equipment or
any Lease or any interest therein, by operation of law or otherwise, or (b)
sublease or lend any of the Equipment or permit any of the Equipment to be used
by anyone other than Lessee.
15. ASSIGNMENT BY LESSOR. Lessor may assign, sell or encumber its interest in
any of the Equipment and any Lease. Upon Lessor's written consent, Lessee shall
pay directly to the assignee of any such interest all Rent and other sums due
under an assigned Lease. THE RIGHTS OF ANY SUCH ASSIGNEE SHALL NOT BE SUBJECT TO
ANY ABATEMENT, DEDUCTION, OFF-SET, COUNTERCLAIM, RECOUPMENT, DEFENSE OR OTHER
RIGHT WHICH LESSEE MAY HAVE AGAINST LESSOR OR ANY OTHER PERSON OR ENTITY.
Notwithstanding the foregoing, any such assignment (a) shall be subject to
Lessee's right to possess and use the Equipment subject to a Lease so long as
Lessee is not in default thereunder, and (b) shall not release any of Lessor's
obligations hereunder.
16. RETURN OF EQUIPMENT. Unless Lessee has exercised its option, if any, to
renew a lease or purchase the Equipment subject thereto, upon expiration of the
then current Lease Term of such Lease, Lessee shall, at its expense, cause such
Equipment to be removed, disassembled, and placed in the same condition as when
delivered to Lessee (reasonable wear and tear excepted) and properly crate such
Equipment for shipment and deliver it to a common carrier designated by Lessor.
Lessee will ship such Equipment, F.O.B. destination, to any address specified in
writing by Lessor within the continental United States. All additions,
attachments, alterations and repairs made or placed upon any of the Equipment
shall become part of such Equipment and shall be the property of Lessor.
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17. EVENTS OF DEFAULT. The occurrence of any of the following shall be deemed
to constitute an Event of Default hereunder: (a) Lessee fails to pay Rent, any
other amount it is obligated to pay under a Lease or any other amount it is
obligated to pay to Lessor and does not cure such failure within 10 days of such
amount becoming due; (b) Lessee fails to perform or observe any obligation or
covenant to be performed or observed by Lessee hereunder or under any Schedule,
including, without limitation, supplying all requested documentation, and does
not cure such failure within 10 days of receiving written notice from Lessor;
(c) the occurrence and continuance of any default under any other lease or
agreement for borrowed money made between Ascend Communications, Inc. or its
affiliates or successors, and the Lessee; (d) any warranty, representation or
statement made or furnished to Lessor by or on behalf of Lessee is proven to
have been false in any material respect when made or furnished; (e) the
attempted sale or encumbrance by Lessee of the Equipment, or the making of any
levy, seizure or attachment thereof or thereon; or (f) the dissolution,
termination of existence, discontinuance of business, insolvency, or appointment
of a receiver of any part of the property of Lessee, assignment by Lessee for
the benefit of creditors, the commencement of proceedings under any bankruptcy,
reorganization or arrangement laws by or against Lessee, or any other act of
bankruptcy on the part of Lessee.
18. REMEDIES OF LESSOR. At any time after the occurrence of any Event of
Default, Lessor may exercise one or more of the following remedies: (a) Lessor
may terminate any or all of the Leases with respect to any or all items of
Equipment subject, thereto; (b) Lessor may recover from Lessee all Rent and
other amounts then due and to become due under any or all of the Leases; (c)
Lessor may take possession of any or all items of Equipment, wherever the same
may be located, without demand or notice, without any court order or other
process of law and without liability to Lessee for any damages occassioned by
such taking of possession, and any such taking of possession shall not
constitute a termination of any Lease; (d) Lessor may demand that Lessee return
any or all items of Equipment to Lessor in accordance with Paragraph 16; and (e)
Lessor may pursue any other remedy available at law or in equity, including,
without limitation, seeking damages, specific performance or an injunction.
Upon repossession or return of any item of the Equipment, Lessor shall sell,
lease or otherwise dispose of such item in a commercially reasonable manner,
with or without notice and on public or private bid, and apply the net proceeds
thereof (after deducting the estimated fair market value of such item at the
expiration of the term of the applicable Lease, in the case of a sale, or the
rents due for any period beyond the scheduled expiration of such Lease, in the
case of any subsequent lease of such item, and all expenses, including, without
limitation, reasonable attorneys' fees, incurred in connection therewith)
towards the Rent and other amounts due under such Lease, with any excess net
proceeds to be retained by Lessor.
Each of the remedies under this Lease shall be cumulative, and not exclusive,
and in addition to any other remedy referred to herein or otherwise available to
Lessor in law or in equity. Any repossession or subsequent sale or lease by
Lessor of any item of Equipment shall not bar an action for a deficiency as
herein provided, and the bringing of an action or the entry of judgment against
Lessee shall not bar Lessor's right to repossess any or all items of Equipment.
19. CREDIT AND FINANCIAL INFORMATION. Within 90 days of the close of each of
Lessee's fiscal years, Lessee shall deliver to Lessor a copy of Lessee's annual
report, if any, and an audited balance sheet and profit and loss statement with
respect to such year. Within 30 days after the end of each of Lessee's fiscal
months, Lessee shall deliver to Lessor a balance sheet and profit and loss
statement for such month and, if requested, any other additional information
regarding historical or projected operating performance reasonably requested by
Lessor, all of which shall be certified by an officer of Lessee.
20. INSURANCE. As of the date that risk of loss for the Equipment passes from
the Supplier to the Lessee under the terms of the Agreement, Lessee shall obtain
and maintain through the end of the Lease Term of each Lease (and any renewal or
extension thereof), at its own expense, property damage and personal liability
insurance and insurance against loss or damage to the Equipment, including,
without limitation, loss by fire (with extended coverage), theft and such other
risks of loss as are customarily insured against with respect to the types of
Equipment leased hereunder and by the types of businesses in which such
Equipment will be used by Lessee. Such insurance shall be in such amounts, with
such deductibles, in such form and with such insurers as shall be satisfactory
to Lessor; provided, however, that the amount of the insurance against loss or
damage to the Equipment shall not be less than the greater of the replacement
value of the Equipment, from time to time, or the original purchase price of the
Equipment. Each insurance policy shall name Lessee as an insured and Lessor as
an additional insured or loss payee, and shall contain a clause requiring the
insurer to give Lessor at least 30 days prior written notice of any alteration
in the terms of such policy or of the cancellation thereof. Lessee shall furnish
to Lessor a certificate of insurance or other evidence satisfactory to Lessor
that such insurance coverage is in effect; provided, however, that Lessor shall
be under no duty either to ascertain the existence of or to examine such
insurance policy or to advise Lessee in the event such insurance coverage shall
not comply with the requirements hereof. Lessee shall give Lessor prompt notice
of any damage to, or loss of, any of the Equipment, or any part thereof, or any
personal injury or property damage occasioned by the use of any of the
Equipment.
21. TAXES. Lessee hereby assumes liability for, and shall pay when due, and, on
a net after-tax basis, shall indemnify, protect and hold harmless Lessor
against all fees, taxes and governmental charges (including, without limitation,
interest and penalties) of any nature imposed on or in any way relating to
Lessor, Lessee, any item of Equipment or any Lease, except state and local taxes
on or measured by Lessor's net income (other than any such tax which is in
substitution for or relieves Lessee from the payment of taxes it would otherwise
be obligated to pay or reimburse to Lessor as herein provided) and federal taxes
on Lessor's net income. Lessee shall, at its expense, file when due with the
appropriate authorities any and all tax and similar returns, and reports
required to be filed with respect thereto, for which it has indemnified Lessor
hereunder or, if requested by Lessor, notify Lessor of all such requirements and
furnish Lessor with all information required for Lessor to effect such filings.
Any fees, taxes or other charges paid by Lessor upon failure of Lessee to make
such payments shall, at Lessor's option, become immediately due from Lessee to
Lessor and shall be subject to the Overdue Charge from the date paid by Lessor
until the date reimbursed by Lessee.
22. SEVERABILITY. If any provision of any Lease is held to be invalid by a
court of competent jurisdiction, such invalidity shall not affect the other
provisions of such Lease or any provision of any other Lease.
23. NOTICES. All notices hereunder shall be in writing and shall be deemed
given when sent by certified mail, postage prepaid, return receipt requested,
addressed to the party to which it is being sent at its address set forth herein
or to such other address as such party may designate in writing to the other
party.
24. AMENDMENTS, WAIVERS AND EXTENSIONS. This MLA and each Schedule constitute
the entire agreement between Lessor and Lessee with respect to the lease of the
Equipment subject to such Schedule, and supersede all previous communications,
understandings, and agreements, whether oral or written, between the parties
with respect to such subject matter. No provision of any Lease may be changed,
waived, amended or terminated except by a written agreement, specifying such
change, waiver, amendment or termination, signed by both Lessee and Lessor,
except that Lessor may insert, on the appropriate schedule, the serial number of
Equipment, after delivery of such Equipment, and the Rent Commencement Date for
the Equipment. No waiver by Lessor of any Event of Default shall be construed as
a waiver of any future Event of Default or any other Event of Default. At the
expiration of the Lease Term with respect to a Lease, upon notice given by
Lessee at least ninety (90) days prior thereto, (a) such Lease shall be renewed
or the Equipment subject thereto shall be purchased under the terms and
conditions set forth herein for a term and rent amount or purchase price, as the
case may be, to be agreed upon, or (b) if no such agreement is reached prior to
the expiration of such Lease Term or such notice specifies that Lessee intends
to return the Equipment, then Lessee shall return the Equipment to Lessor in the
manner prescribed in Paragraph 16 of this MLA. In the absence of Lessor's timely
receipt of the notice contemplated by the preceding sentence, the Lease shall be
automatically extended, on a month-to-month basis, until terminated (upon the by
either party given at least ninety (90) days prior to the end of the month on
which the termination is be effective) or until renewed or the Equipment subject
thereto is purchased by agreement of the parties. Unless otherwise agreed,
Lessee shall continue to pay Rent for each month following such Lease Term until
the Equipment subject to such Lease is returned pursuant to Paragraph 16 of this
MLA.
25. CONSTRUCTION. This MLA shall be governed by and construed in accordance
with the internal laws, but not with the choice of laws provisions, of the State
of California. The titles of the sections of this MLA are for convenience only
and shall not define or limit any of the terms or provisions hereof. Time is of
the essence in each of the provisions hereof.
26. PARTIES. This MLA shall be binding upon, and inure to the benefit of, the
permitted assigns, representatives and successors of the Lessor and Lessee. If
there is more than one Lessee named in this MLA, the liability of each shall be
joint and several.
27. COUNTERPARTS. Each Lease may be executed in two or more counterparts, each
of which shall be deemed an original and all of which together shall constitute
but one and the same instrument.
28. OVERDUE CHARGE. Overdue Charge shall mean an amount equal to 2% per month
of any payment under a Lease which is past due, including, without limitation,
any amounts not included in any payment of Rent hereunder, or the highest charge
permitted by law, whichever is lower.
The person executing this MLA on behalf of Lessee hereby certifies that he or
she has read, and is duly authorized to execute, this MLA.
Accepted by: LESSEE: PhoneXchange, Inc.
By: /s/ XXXXXXX SEVERIEUS BY: /s/ XXXXX X. XXXXXXXX
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NAME: Xxxxxxx Severieus NAME: Xxxxx X. Xxxxxxxx
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TITLE: Assistant Treasurer TITLE: President
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DATE: July 30, 1999 DATE: July 30, 1999
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LEASE SCHEDULE NO. 1
This Schedule and its supplements incorporate by this reference the terms and
conditions of the Master Lease Agreement, Number ______, between Ascend Credit
Corporation (Lessor) and PhoneXchange, Inc. (Lessee).
1. SUPPLIER: ASCEND COMMUNICATIONS, INC.
2. LOCATION OF EQUIPMENT: SEE ATTACHED
3. EQUIPMENT VALUE: $__________________ (exclusive of sales and/or use taxes).
4A. LEASE TERM: The Lease Term of the Equipment described in this Schedule
shall begin on the Rent Commencement Date referenced below in Paragraph 6
and its expiration date shall be 33 months after such Rent Commencement
Date.
5. RENT: SEE ATTACHED SCHEDULE (NOTE: Rent shall be reflected in a payment
schedule to be attached to each specific Lease Schedule. The first XXXXX
payments shall be equal to $XXXX, and the final thirty three (33) payments
shall be based upon a lease factor of XXXX based on the initial purchase
price of the Equipment described in the applicable Lease Schedule with the
first such payment due on the Rent Commencement Date).
6. RENT COMMENCEMENT DATE: ___________________________________.
7. PURCHASE OPTION: Lessee shall have the option to purchase the Equipment
for its fair market value for continued use ("FMV"), on the expiration of
this Lease or any renewal term, provided Lessee is not in default of any
of its obligations under this Lease on such expiration date. This purchase
option may only be exercised by Lessee's written notice to Lessor not
earlier than 180 days, nor later than 90 days, prior to the end of the
Lease Term or any renewal term. The purchase price for such Equipment
shall be payable upon the expiration date of such term. FMV shall be equal
to the value of the Equipment installed and in use, with consideration
given to the age, condition, utility and replacement costs for Equipment.
In the event that Lessor and Lessee are unable to agree upon the purchase
price for the Equipment, such purchase price will be determined by an
independent appraiser to be selected by Lessor. Lessee shall be
responsible for all applicable sales and/or use taxes on the Equipment.
Upon exercise of this purchase option and payment of the purchase price,
Lessor shall execute and deliver to Lessee such documents as Lessee may
reasonably request in order to vest in Lessee all right, title and
interest in the Equipment.
8. RENEWAL OPTION: Lessee shall have the option to renew this Lease, on the
expiration date of this Lease or any renewal term, for the fair market
rental for the continued use of the Equipment ("FMR") and on such other
terms as may be agreed upon by Lessor and Lessee prior to such expiration
date, provided Lessee is not in default of any of its obligations under
this lease on such expiration date. This renewal option may only be
exercised by Lessee's written notice to Lessor not earlier than 180 days,
nor later than 90 days, prior to the end of the Lease Term or any renewal
term. FMR shall be equal to the value of the monthly rental of the
Equipment installed and in use, with consideration given to the age,
condition, utility and replacement costs for the Equipment, for the renewal
term.
9. TAX BENEFITS: Lessee understands that Lessor intends to claim the "Tax
Benefits", consisting of the maximum Modified Accelerated Cost Recovery
System deductions for the minimum useful life applicable to each item of
Equipment, as provided by Sections 168(b) and (c) of the Internal Revenue
Code of 1986, and analogous benefits under state law, with respect to the
Equipment. Lessee represents and warrants that: (i) Lessee has not been,
is not now, and during the term of this Lease will not become, and will
not allow the Equipment to be used by or leased to, a tax-exempt entity or
government agency; and (ii) Lessee is not now, and during the term of this
Lease will not become, a public utility. Without limitation by the
proceeding sentence, Lessee agrees not to take any action, fail to take any
action, or misstate any fact which may result in any loss to Lessor of the
Tax Benefits.
Lessee agrees to pay promptly to Lessor an amount which will fully
compensate Lessor, on an after-tax basis, for any loss of the Tax Benefits,
plus interest, penalties and additions to tax, any loss in time value of
the Tax Benefits, and any taxes imposed on any such compensation payment,
resulting from Lessee's acts, omissions or misstatements, including,
without limitation, with respect to the representations and warranties in
the preceding paragraph. A loss of Tax Benefits occurs at the earliest of:
(i) the happening of any event causing the loss; (ii) payment by Lessor of
any additional tax resulting from the loss; or (iii) any adjustment to the
tax return of Lessor. Lessor's right to recovery of a loss of Tax Benefits
shall survive the expiration or termination of this Lease.
10. DESCRIPTION OF EQUIPMENT: See Schedule A which is attached hereto and made
a part hereof by this reference.
The person executing this Schedule on behalf of Lessee hereby certifies that he
or she has read, and is duly authorized to execute, this Schedule.
Accepted by:
Ascend Credit Corporation LESSEE: PhoneXchange, Inc.
Draft
BY: _______________________________ BY: ____________________________________
NAME: _____________________________ NAME: __________________________________
Print Print
TITLE: ____________________________ TITLE: _________________________________
DATE: _____________________________ DATE: __________________________________
