Exhibit No. 99.1 Master Lease Agreement between RBS Lombard Inc. and
The Pep Boys - Manny, Moe & Xxxx dated October 18, 2004.
THIS MASTER LEASE AGREEMENT is dated as of October 18, 2004 (this "Master
Lease") among THE PEP BOYS - MANNY, MOE & XXXX, a Pennsylvania corporation
(together with its successors and assigns, "Pep Boys"), THE PEP BOYS XXXXX XXX
& XXXX OF CALIFORNIA, a California corporation (together with its successors
and assigns, "Pep Boys of California"), PEP BOYS - MANNY, MOE & XXXX OF PUERTO
RICO, INC., a Delaware corporation (together with its successors and assigns,
"Pep Boys of Puerto Rico"), and PEP BOYS - MANNY, MOE & XXXX OF DELAWARE,
INC., a Delaware corporation (together with its successors and assigns, "Pep
Boys of Delaware"; Pep Boys, Pep Boys of California, Pep Boys of Puerto Rico
and Pep Boys of Delaware are referred to herein jointly and severally as
"Lessee"), and RBS LOMBARD, INC. , a New York corporation (together with its
successors and assigns, "Lessor").
1. Lease of Equipment. Subject to the terms of each related Schedule executed
by the parties hereto and incorporating the terms of this Master Lease by
reference therein (each, a "Schedule"), together with all exhibits, Riders (as
defined below), supplements and attachments thereto (collectively, a "Lease"),
Lessor hereby leases to Lessee and Lessee hereby leases from Lessor the
property described in each Schedule (together with all accessories,
attachments, parts, repairs, additions, upgrades and accessions thereto and all
replacements and substitutions therefor, the "Equipment"). Unless Lessor and
Lessee expressly agree otherwise in writing, all Schedules held by Lessor at
the time of determination, with the terms of this Master Lease incorporated by
reference therein, and together with all exhibits, Riders, supplements and
attachments thereto, shall collectively constitute a separate lease with
respect to the Equipment covered thereby, and all Schedules held by each
successor and assign of Lessor at the time of determination, with the terms of
this Master Lease incorporated by reference therein, and together with all
exhibits, Riders, supplements and attachments thereto, shall collectively
constitute a separate, but different, lease with respect to the Equipment
covered thereby. As used herein, the term "Lease" shall mean the terms and
conditions applying to the lease of the subject Equipment. Lessee acknowledges
and agrees that, unless a Schedule expressly provides to the contrary, each
Lease is a "Finance Lease" as defined by Section 2A-103(1)(g) of the Uniform
Commercial Code (the "UCC") and Lessee has reviewed and approved any written
Supply Contract (as defined by UCC Section 2A-103(1)(y)) covering the Equipment
purchased from any Supplier (as defined by UCC Section 2A-103(1)(x), a
"Supplier").
2. Term and Rent. Equipment described in a Schedule shall be leased for a term
(the "Term") that shall commence on the date stated in such Schedule and
continue for the period stated therein, including any extension or renewal
periods as provided in any written rider thereto executed by Lessee and Lessor
(each rider to a Schedule hereinafter, a "Rider"). Lessee shall pay Lessor the
rental payments in the aggregate amounts specified in the Schedule, without
notice or prior demand, and all other amounts payable pursuant to the related
Lease (collectively, "Rent"). If any Rent shall be unpaid after the due date
thereof, Lessee shall pay on demand a late charge equal to 3% of any such
unpaid Rent but in no event to exceed the maximum lawful charges. EACH LEASE
IS NONCANCELABLE BY LESSEE FOR ITS ENTIRE TERM, and Lessee has no right of
termination or purchase of any Equipment except as specifically granted to
Lessee in a Schedule or a Rider. Upon the expiration of the Term respecting
Equipment, and until the return to Lessor of all such Equipment in accordance
with the terms of the Lease applicable thereto, or until any purchase option
with respect thereto is exercised in accordance with the terms of the Lease
applicable thereto, at the option of Lessor, in its sole discretion, such Lease
shall remain effective and shall become a month-to-month lease between the
parties with respect to such Equipment on the same terms and conditions of such
Lease and the monthly Rent in effect immediately prior to such expiration shall
be the monthly Rent payable during such month-to-month term under the
applicable Schedule.
3. Representations, Warranties and Covenants of Lessee. Lessee represents and
warrants to, and covenants with, Lessor on the date hereof and the date of each
Schedule that: (a) Lessee is and will remain a corporation, partnership or
limited liability company, as applicable, duly organized and validly existing
in good standing under the laws of the jurisdiction of its organization (as
specified in the first sentence of this Master Lease), duly qualified to do
business in each jurisdiction where any Equipment is, or is to be, located or
the nature of the business transacted by Lessee makes such qualification
necessary, except where the failure to be so qualified would not have a
material adverse affect on the Lessee, the Lessee's ability to perform its
obligations under the Lease Documents or the enforceability of any Lease
Document, and has and will have full power and authority to hold property under
lease and to enter into and perform its obligations hereunder and under each
Lease.(b) Lessee has been fully authorized to execute and deliver this Master
Lease and any related documents, and will be fully authorized to execute and
deliver each Schedule and each of the documents, Riders, supplements and
agreements related thereto (collectively with the Schedule, the "Lease
Documents"), under an appropriate resolution or resolutions of its governing
body and by any other appropriate official approval; all requirements have been
met and all procedures have taken place in order to ensure the enforceability
of this Master Lease and any related documents, and all procedures will be met
and procedures will have occurred in order to ensure the enforceability of each
Lease Document, against Lessee in accordance with their respective terms.
(c) This Master Lease and any related documents have been, and each Lease
Document and each resulting Lease will be, duly authorized, executed and
delivered by Lessee and this Master Lease and any related documents constitute,
and each Lease Document and each resulting Lease will constitute, legal, valid
and binding obligations of Lessee, enforceable against Lessee in accordance
with their respective terms. (d) The execution, delivery and performance by
Lessee of this Master Lease and any Lease Document do not violate any law or
governmental rule, regulation, or order applicable to Lessee or any provision
of Lessee's organizational documents, do not and will not contravene any
provision of, or constitute a default under, any indenture, mortgage, contract,
or other instrument to which it is bound and do not result in the creation of
any lien, charge, security interest or other charge on any Equipment other than
the interest of Lessor under a Lease. (e) There is no action, suit,
proceeding, claim, inquiry or investigation, at law or in equity, before or by
any court, regulatory agency, public board or body pending or, to the best of
Lessee's knowledge, threatened against or affecting Lessee, challenging
Lessee's authority to enter into this Master Lease or any Lease Document or any
other action wherein an unfavorable ruling or finding would adversely affect
the enforceability of this Master Lease or any Lease Document, or could
reasonably be expected to have a material adverse effect on (i) the business,
assets, operations, properties or condition (financial or otherwise), taken as
a whole, of Lessee, (ii) the ability of Lessee to perform its obligations under
a Lease or (iii) the validity or enforceability of this Master Lease or any
Lease Document or the rights and remedies available to Lessor thereunder.
(f) No action, including any permits or consents, in respect of or by any
state, federal or other governmental authority or agency is required with
respect to the execution, delivery and performance by Lessee of this Master
Lease or any Lease Document or the use or operation of the Equipment, except
such as have already been obtained. (g) As of the date of each Schedule,
Lessee has accepted the related Equipment pursuant to a certificate of
acceptance delivered to Lessor and in form and substance acceptable to Lessor
(a "Certificate of Acceptance") and such Equipment is and will remain personal
property. (h) Each financial statement of Lessee or any guarantor of Lessee's
obligations under a Lease (each a "Guarantor") available to the public or
otherwise delivered to Lessor as of the date hereof and the date of each
Schedule, was prepared in accordance with generally accepted accounting
principles applied consistently with past periods, fairly present the financial
condition of Lessee and each Guarantor, respectively, on the dates thereof and
the results of their operations and cash flows, respectively, for the periods
then ended, and since the date of the most recent of such financial statements,
there has been no material adverse change in the business, properties or
condition (financial or otherwise), taken as a whole, of Lessee or any
Guarantor. (i) The Equipment will at all times be used for commercial or
business purposes. (j) Lessee's location for purposes of Section 9-307 of the
applicable UCC and its organizational identification number are as set forth
below its signature hereto, and Lessee's residence for federal income tax
purposes is at its address set forth below its signature hereto.
(k) Lessee's correct legal name is as set forth on the execution page hereof.
(l) Each of the Lease Documents that purports to create a security interest
creates a valid first priority lien on the related Equipment subject to no
other lien, Lessee has authorized Lessor to file financing statements that are
sufficient when filed to perfect such security interest, and when such
financing statements are filed in the offices noted therein, Lessor will have a
valid and perfected security interest in the Equipment, subject to no other
lien. (m) Lessee has provided an accurate address of the real property where
the Equipment will be located, and no other person other than Lessee and its
vendor partner subtenants or subtenants of surplus property is in occupancy or
possession of any portion of such real property. All of the Equipment is and,
at all times during the related Term, will be located within the continental
United States and shall not be located in Puerto Rico. (n) Lessee is in
compliance with all laws, rules, regulations and orders of governmental
authorities applicable to Lessee, the Equipment or Lessee's properties, except
where the failure to be in such compliance would not have a material adverse
affect on the Lessee, the Equipment or any of the Lessee's properties. (o)
Lessee has paid or caused to be paid, and will pay, to the proper authorities
when due all federal, state and local taxes required to be paid or withheld by
it, and Lessee has filed all federal, state and local tax returns which are
required to be filed by Lessee, except where the failure to pay such taxes or
file such tax returns would not have a material adverse affect on the Lessee or
the Equipment. (p) All factual information furnished, or to be furnished, by
or on behalf of Lessee or any Guarantor in writing to Lessor in connection with
any Lease is or will be, as applicable, true and correct in all material
respects on the date as of which such information is dated or certified, and
does not, or shall not, as applicable, omit to state any material fact
necessary to make such information not misleading. (q) Neither Lessee nor any
Guarantor is engaged principally, or as one of its important activities, in the
business of extending credit for the purpose of purchasing or carrying "margin
stock" (as provided in F.R.S. Board Regulation T, U or X or any regulations
substituted therefor, as from time to time in effect), and none of the proceeds
of any Lease will be used in any manner to enable or assist any person in,
directly or indirectly, purchasing or carrying "margin stock." (r) Neither
Lessee nor any Guarantor is an "investment company" or a "company controlled by
an investment company" within the meaning of the Investment Company Act of
1940, as amended, or a "holding company," or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, as amended. (s) Lessee is solvent and will not
be rendered insolvent by the Lease Documents or the transactions contemplated
thereby and, after giving effect to such transactions, Lessee will not be left
with an unreasonably small amount of capital with which to engage in its
business, nor does Lessee intend to incur, or believe that it has incurred,
debts beyond its ability to pay as they mature, and Lessee does not contemplate
the commencement of insolvency, bankruptcy, liquidation or consolidation
proceedings or the appointment of a receiver, liquidator, conservator, trustee
or similar official in respect of Lessee or any of its assets, and Lessee is
not entering into the transactions contemplated by the Lease Documents with any
intent to hinder, delay or defraud any of Lessee's creditors. (t) No event
has occurred or is reasonably expected to occur that, when taken together with
all other such events, could reasonably be expected to result in liability
pursuant to the Employee Retirement Income Security Act of 1974, as amended,
or the regulations with respect thereto (or any similar statute or regulation)
("ERISA") in an amount that would result in a material adverse affect on the
Lessee, the Lessee's ability to perform its obligations under the Lease
Documents or the enforceability of any Lease Document. (u) All Equipment
owned by Pep Boys of Puerto Rico is and shall be located in Puerto Rico.
4. Disclaimer of Warranties; No Agency. Lessee acknowledges that Lessor is not
the manufacturer of the Equipment, the manufacturer's agent or a dealer
therein; the Equipment is of a size, design, capacity, description and
manufacture selected by Lessee; Lessee is satisfied that the Equipment is
suitable and fit for its purposes; and LESSOR HAS NOT MADE AND DOES NOT MAKE
ANY WARRANTY OR REPRESENTATION WHATSOEVER, EITHER EXPRESS OR IMPLIED, AS TO THE
FITNESS, CONDITION, MERCHANTABILITY, DESIGN OR OPERATION OF THE EQUIPMENT, ITS
FITNESS FOR ANY PARTICULAR PURPOSE, THE QUALITY OR CAPACITY OF THE MATERIALS
IN THE EQUIPMENT OR WORKMANSHIP IN THE EQUIPMENT, LESSOR'S TITLE TO THE
EQUIPMENT NOR ANY OTHER REPRESENTATION OR WARRANTY WHATSOEVER; Lessor shall not
be liable to Lessee for any loss, damage, or expense of any kind or nature
caused, directly or indirectly, by the Equipment or the use or maintenance
thereof or the failure or operation thereof, or the repair, service or
adjustment thereof, or by any delay or failure to provide any such maintenance,
repairs, service or adjustment, or by any interruption of service or loss of
use thereof or for any loss of business howsoever caused. No defect or
unfitness of the Equipment shall relieve Lessee of the obligation to pay any
Rent or perform any other obligation under any Lease. Lessor shall have no
obligation under a Lease in respect of the Equipment and shall have no
obligation to ship, deliver, assemble, install, erect, test, adjust or
service the Equipment. Lessor agrees that until an Event of Default (as
defined in Section 15) has occurred, Lessor will permit Lessee, as Lessee's
sole and exclusive remedy hereunder, to enforce in Lessee's own name and at
Lessee's sole expense any Supplier's or manufacturer's warranty or agreement in
respect of the Equipment to the extent that such warranty or agreement is
assignable. Lessee acknowledges and agrees that none of the manufacturer, the
Supplier or any salesman, representative or other agent of the manufacturer or
the Supplier is an agent of Lessor. No salesman, representative or agent of
the manufacturer or the Supplier is authorized to waive or alter any term or
condition of any Lease, and no representation as to the Equipment or any other
matter by the manufacturer or the Supplier shall in any way affect Lessee's
duty to pay Rent and perform its other obligations as set forth in a Lease.
5. Exclusion of Consequential Damages. NOTWITHSTANDING ANYTHING TO THE
CONTRARY CONTAINED IN ANY LEASE, LESSOR SHALL NOT, UNDER ANY CIRCUMSTANCES, BE
LIABLE TO LESSEE OR ANY THIRD PARTY, FOR CONSEQUENTIAL, INCIDENTAL, SPECIAL OR
EXEMPLARY DAMAGES ARISING OUT OF OR RELATED TO ANY TRANSACTION CONTEMPLATED
UNDER ANY LEASE, WHETHER IN AN ACTION BASED ON CONTRACT, TORT (INCLUDING
NEGLIGENCE OR STRICT LIABILITY) OR ANY OTHER LEGAL THEORY, INCLUDING, BUT NOT
LIMITED TO, LOSS OF ANTICIPATED PROFITS OR BENEFITS OF USE OR LOSS OF BUSINESS,
EVEN IF LESSOR IS APPRISED OF THE LIKELIHOOD OF SUCH DAMAGES OCCURRING.
6. Risk of Loss. As between Lessee and Lessor, Lessee hereby assumes and shall
bear the entire risk of loss for theft, damage, destruction or other injury to
or loss or loss of use of the Equipment from any and every cause whatsoever.
NO SUCH LOSS OR DAMAGE SHALL IMPAIR ANY OBLIGATION OF LESSEE UNDER ANY LEASE
WHICH SHALL CONTINUE IN FULL FORCE AND EFFECT. In the event of damage or loss
to the Equipment (or any part thereof) and irrespective of payment from any
insurance coverage maintained by Lessee, but subject to any application thereof
as provided in Section 7, Lessee shall (a) place the Equipment in good repair,
condition and working order; (b) replace the Equipment (or any part thereof)
with like equipment of equal value (fair market value in a retail sale to an
unrelated third party) and in good repair, condition and working order and
transfer clear title to such replacement equipment to Lessor whereupon such
replacement equipment shall be deemed the Equipment for all purposes; or (c) on
the rental payment date next following the damage or loss, pay to Lessor the
sum of (i) the Stipulated Loss Value (as defined below) for such Equipment as
calculated by Lessor and (ii) any and all other amounts otherwise then due and
owing under the related Lease or which otherwise will become due and owing
irrespective of the fact that the Equipment has been damaged, destroyed, lost
or stolen, including, without limitation, any additional taxes or other charges
that may otherwise arise by reason of the damage, destruction, loss or theft of
the Equipment. "Stipulated Loss Value" means the product of the Original
Equipment Cost (as defined in the related Schedule) of the Equipment and the
applicable percentage factor set forth in a Rider for the applicable rental
payment date.
7. Insurance. Lessee shall obtain and maintain for the entire term of each
Lease, at its own expense (as primary insurance for Lessor and Lessee),
property damage, business interruption and liability insurance and insurance
against loss or damage to the Equipment, including, without limitation,
coverage for loss by fire (including so-called extended coverage), theft,
collision and such other risks of loss as are customarily insured against on
property of a type similar to the Equipment and by businesses engaged in the
business in which Lessee is engaged or as otherwise required by Lessor, in such
amounts, in such form and with such insurers as shall be satisfactory to
Lessor; provided, however, that, in any case, the amount of insurance against
loss or damage to the Equipment shall be the greater of (a) the replacement
value of the Equipment or (b) the Stipulated Loss Value for all Equipment as
specified in the related Rider, and the amount of insurance for liability
coverage shall be at least $5,000,000 total liability per occurrence unless
otherwise specified in any Schedule. No insurance policy shall be subject to
any co-insurance clause. All insurance covering loss or damage to the
Equipment shall contain a breach of warranty clause satisfactory to Lessor.
Each insurance policy shall name Lessee as an insured and Lessor as an
additional insured and loss payee thereof as Lessor's interests may appear and
shall contain a clause requiring the insurer to give Lessor at least 30 days
prior written notice of any alteration or cancellation of such policy. Upon
the request therefore from Lessor at any time, Lessee shall promptly 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 further agrees to give Lessor
prompt notice of any damage to, or loss of, the Equipment, or any part thereof
8. Maintenance; Additions. Lessee shall, at its sole expense, maintain,
preserve, protect and keep the Equipment in good repair, condition and working
order and in compliance with all governmental laws, regulations, requirements,
rules, manufacturer's instructions and warranty requirements and the conditions
and requirements of all policies of insurance and shall ensure that the latest
version of operating software is installed in the Equipment at all times.
Lessee shall make necessary and proper repairs and furnish any and all parts,
mechanisms and devices required to keep the Equipment in the condition required
by the immediately preceding sentence, at the sole cost and expense of Lessee.
Lessee, at its sole expense, shall enter into and maintain in force, for the
entire Term with respect to the subject Equipment, any maintenance contracts
required by the manufacturer, Supplier or any insurer of the Equipment, and
shall provide to Lessor a copy of such contract and all supplements thereto.
If Lessee enters into such maintenance contract with a party other than the
manufacturer of the Equipment, Lessee shall, at its sole expense, have the
manufacturer recertify the Equipment at the expiration of the related Term,
including any renewals or extensions thereof, and the Term shall continue upon
the same terms and conditions until such recertification has been obtained.
Lessee shall not attach or install anything in or on any Equipment that could
impair the originally intended function or use of such Equipment unless Lessor
has provided its prior written consent. Upon demand of Lessor, Lessee shall
remove all additions, parts, supplies, upgrades, accessories and equipment
furnished, attached or installed in, on or to any Equipment ("Additions") and
shall repair all damage to the Equipment caused by such removal so as to
restore such Equipment to the condition which existed prior to installation of
such Additions and as required by this Master Lease. All Additions that are
not readily removable shall become part of the Equipment subject to all terms
and conditions of the related Lease and subject to the interest of Lessor.
Any Additions shall be made only in compliance with this Master Lease, the
related Lease Documents and applicable law. Without the prior written consent
of Lessor, Lessee shall not attach or install any Equipment to any real
property such that it would become a part thereof. The Equipment is, and shall
at all times be and remain, personal property notwithstanding that the
Equipment or any part thereof may now be, or hereafter become, in any manner
affixed or attached to, or imbedded in, or permanently resting upon, real
property or any building thereon.
9. Taxes, Fees and Assessments. Lessee shall pay when due or reimburse Lessor,
and on a net after-tax basis, shall indemnify and defend Lessor against, all
fees, assessments and sales, use, property, excise and other taxes and
governmental charges, including, without limitation, interest and penalties now
and hereafter imposed by any federal, foreign, state or local governmental body
or agency upon any Equipment, or the use thereof; provided, however, except as
provided in Section 19, Lessee shall have no liability for any taxes based on
the net income of Lessor. Lessee assumes the risk of liability arising from or
pertaining to the delivery, installation, leasing, possession, operation, use,
storage and return of such Equipment. Lessee agrees to file all tax returns
and informational statements required by any federal, state and/or local
governmental agency and provide evidence of payment to Lessor. All of
Lessor's rights, privileges and indemnities contained in this Section shall
survive the expiration or other termination of any Lease.
10. Return of Equipment. (a) At the expiration or earlier termination of any
Term in respect of Equipment, unless Lessee purchases the Equipment or renews
the Lease in accordance with the terms of such Lease, Lessee shall, at
Lessee's risk and expense, perform any testing and repairs required to place
the units of Equipment in the same condition and appearance as when received
by Lessee (reasonable wear and tear excepted) and in the condition required by
the first sentence of Section 8, and all items of Equipment to be returned
shall be the same model and serial numbers as those for the Equipment as of the
Acceptance Date (as defined in the related Schedule), and no substitution of
similar equipment shall be allowed. If required by Lessor, the units of
Equipment shall be reinstalled, disassembled and crated by an authorized
manufacturer's representative or such other service person as is reasonably
satisfactory to Lessor. Lessee shall remove installed markings that are not
necessary for the operation, maintenance or repair of the Equipment. All
Equipment shall be cleaned, cosmetically acceptable, and in such condition as
to be immediately installed into use in a similar environment for which the
Equipment was originally intended to be used. All waste material and fluid
must be removed from the Equipment and disposed of in accordance with then
current waste disposal laws. Lessee shall return the units of Equipment to a
location within the continental United States as Lessor shall direct. Lessee
shall obtain and pay for a policy of transit insurance for the redelivery
period in an amount equal to the replacement value of the Equipment. The
transit insurance must name Lessor as the loss payee. Lessee shall pay for all
costs to comply with this subsection (a).
(b) Until Lessee has fully complied with the requirements of subsection (a)
above, Lessee's Rent payment obligations with respect to the subject Equipment
and all other obligations under the related Lease with respect thereto shall
continue from month to month notwithstanding any expiration or termination of
the related Term. Lessor may terminate Lessee's right to use the Equipment
under this subsection (b) upon 10 days notice to Lessee.
(c) Lessee shall provide to Lessor a detailed inventory of all components of
the Equipment including model and serial numbers at least 90 days prior to the
expiration or termination of the related Term. Lessee shall also provide an
up-to-date copy of all other documentation pertaining to the Equipment,
including but not limited to all service manuals, operating manuals and
maintenance records upon expiration or termination of the related Term.
(d) Lessee shall make the Equipment available for on-site operational
inspections by potential purchasers at least 120 days prior to and continuing
up to the expiration or termination of the related Term. Lessor shall provide
Lessee with reasonable notice prior to any inspection. Lessee shall provide
personnel, power and other requirements necessary to demonstrate electrical,
hydraulic and mechanical systems for each item of Equipment.
11. Affirmative and Negative Covenants. Lessee covenants and agrees as
follows: (a) Lessee shall comply with all governmental laws, regulations,
requirements, rules, except where the failure to be in such compliance would
not have a material adverse affect on the Lessee or the Equipment; and, to the
extent related to any Equipment or any Lease, with all manufacturer's
instructions, warranty requirements and the conditions and requirements of all
policies of insurance. (b) Lessee shall, upon the request of Xxxxxx, xxxx and
identify the Equipment with all information and in such manner as Lessor may
request from time to time and replace promptly any such markings or
identification which are removed, defaced or destroyed, and Lessee shall not
permit the name of any person, association or corporation other than Lessor to
be placed on the Equipment as a designation that might be interpreted as a
claim of ownership or security interest. (c) Lessee shall at all reasonable
times and intervals during business hours xxxxx Xxxxxx and any of its
representatives (including outside auditors) free access to (i) enter upon the
premises wherein the Equipment shall be located or used and permit Lessor to
inspect the Equipment, and (ii) examine and audit its books and records
(including computer records) relating to the Equipment and any Lease.
(d) Lessee shall maintain a system of accounts established and administered in
accordance with generally accepted accounting principles and practices applied
consistently with past practices. (e) Lessee shall not create, incur, assume
or suffer to exist any mortgage, lien, pledge or other encumbrance or
attachment of any kind whatsoever upon, affecting or with respect to the
Equipment, this Master Lease or any Lease or any of Lessor's interests
thereunder. (f) Lessee shall not make any changes or alterations in or to the
Equipment except as necessary for compliance with Section 8 above. (g) Lessee
shall possess and control each of the items of Equipment and shall not change
the location of the Equipment or any part thereof from the address shown on the
related Schedule without the prior written consent of Lessor, except to
another Location (as defined in such Schedule) in accordance with such Schedule.
(h) Lessee agrees to comply with, and to cause each Guarantor (as defined
below) to comply with, the financial covenants set forth in any Schedule.
(i) Lessee shall deliver to Lessor each of the following:
(i) promptly but in no event later than 10 days after any tax or other lien
shall attach to any Equipment, notice of the full particulars of the tax or
lien,
(ii) with respect to itself and each guarantor of obligations under a Lease
(each, a "Guarantor"), (a) as soon as practicable, and in any event within 45
days after the end of each fiscal quarter (other than the last fiscal quarter),
unaudited financial statements including in each instance, balance sheets,
income statements, and statements of cash flow, on a consolidated and
consolidating basis, as appropriate, and separate profit and loss statements as
of and for the quarterly period then ended and for the fiscal year to date,
prepared in accordance with GAAP, and certified by Lessee's chief financial
officer or such Guarantor's chief financial officer, as applicable, to be true
and correct, (b) as soon as practicable, and in any event within 90 days after
the end of each fiscal year, annual audited financial statements, including
balance sheets, income statements and statements of cash flow for the fiscal
year then ended, on a consolidated and consolidating basis, as appropriate,
which have been prepared by the independent accountants of Lessee or such
Guarantor, as applicable, in accordance with GAAP, and (c) as soon as
practicable, any certifications required by the Securities and Exchange
Commission of the United States or by securities laws applicable to Lessee and
each Guarantor concerning financial statements of Lessee or the Guarantor, as
applicable. Such audited financial statements shall be accompanied by the
independent accountant's opinion, which opinion shall be in form generally
recognized as "unqualified." Lessee shall be deemed to have complied with the
foregoing requirements with respect to Lessee and/or any Guarantor, as
applicable, if such entity files Forms 10-K and 10-Q with the Securities and
Exchange Commission that are publicly available within the time frames set
forth above. Lessee shall cause each Guarantor to deliver such financial
information as Lender shall require from time to time.
(iii) promptly, but in no event later than 15 days after the occurrence
thereof, notice of any lost or damage to the Equipment (where the estimated
repairs costs would exceed the greater of 5% of the Original Equipment Cost or
$100,000) or any accident involving the Equipment causing personal injury or
property damage, and
(iv) promptly but in no event later than three (3) business days after the
occurrence thereof, notice of any Event of Default or any event which with
lapse of time or notice, or both, might become an Event of Default hereunder
(a "Default") and a statement of Lessee setting forth reasonably detailed
information regarding such Default or Event of Default and the actions that
Lessee has taken or proposes to take with respect thereto.
12. Lessee's Identity, Address and Location. Lessee shall not change its
name, address, organizational identification number, if any, or location for
purposes of Section 9-307 of the applicable UCC from that set forth below its
signature hereto, unless it shall have given Lessor or its assigns no less than
30 days' prior written notice.
13. No Assignment or Sublease by Lessee. LESSEE SHALL NOT ASSIGN, SELL,
TRANSFER, ENCUMBER OR IN ANY WAY DISPOSE OF ALL OR ANY PART OF ITS RIGHTS OR
OBLIGATIONS UNDER THIS MASTER LEASE OR ANY LEASE OR ANY OF THE EQUIPMENT
WITHOUT THE PRIOR WRITTEN CONSENT OF LESSOR, AND LESSEE SHALL NOT ENTER INTO
ANY SUBLEASE OF ALL OR ANY PART OF THE EQUIPMENT WITHOUT THE PRIOR WRITTEN
CONSENT OF LESSOR.
14. Quiet Enjoyment. So long as no Event of Default shall have occurred,
Lessee shall be entitled to possession and use of the Equipment for the Term
with respect thereto in its lawful business in accordance with the provisions
of the Lease.
15. Events of Default. Each of the following events or occurrences shall
constitute an "Event of Default" hereunder and under a Lease: (a) Lessee
fails to pay any installment of Rent or other payment required hereunder or
under any Lease Document when due and payable, by acceleration or otherwise,
and such failure continues for a period of 10 calendar days; (b) any
representation or warranty of Lessee made in any Lease Document or any other
writing or certificate furnished by or on behalf of Lessee pursuant to any
Lease Document is or shall be incorrect or incomplete when made in any
material respect; (c) Lessee fails to perform any of its obligations under
Section 6, 7, 11(e), 11(i), 12 or 13; (d) Lessee fails to perform or observe
any other covenant, condition or agreement to be performed or observed by it
hereunder or under any Lease Document, and such failure or breach shall
continue unremedied for a period of 30 days after Lessee becomes aware of such
failure or breach or has received notice by Lessor thereof; (e) any person or
group (as such term is used in Section 13(d)(3) of the Securities Exchange Act
of 1934, as amended) acquires, after the date of this Master Lease, of the
beneficial ownership directly or indirectly, of 50% or more of the voting power
of the total outstanding stock or other ownership interests of Lessee or the
Guarantor (a "change of control") or there is any merger, consolidation,
dissolution, liquidation, winding up or sale or other transfer of all
substantially all of the assets of Lessee or any Guarantor pursuant to which
there is a change of control or cessation of Lessee or any Guarantor or their
business, (f) Lessee or any Guarantor shall be or become insolvent, or admit in
writing its inability to pay its debts as they mature, or make an assignment
for the benefit of creditors; or Lessee or any Guarantor shall apply for or
consent to the appointment of any receiver, trustee or similar officer for it
or for all or any substantial part of its property; or such receiver, trustee
or similar officer shall be appointed without the application or consent of
Lessee or any Guarantor; or Lessee or any such guarantor shall institute (by
petition, application, answer, consent or otherwise) any bankruptcy,
insolvency, reorganization, arrangement, readjustment of debt, dissolution,
liquidation or similar proceeding relating to it under the laws of any
jurisdiction; or any such proceeding shall be instituted (by petition,
application or otherwise) against Lessee or any Guarantor; or any Guarantor
that is a natural person shall die or become disabled; (g) any Guarantor shall
fail to perform or repudiate any of its obligations under any guaranty of the
obligations of Lessee; (h) the occurrence of a default or an event of default
(however defined) under that certain Amended and Restated Loan and Security
Agreement dated August 1, 2003 by and among Lessee, Congress Financial
Corporation, as agent, and the other parties thereto, as amended or
supplemented, or under any replacement thereof; (i) the occurrence of a default
or an event of default (however defined) under any instrument, agreement or
other document between or among Lessee or any Guarantor and Lessor or any of
its affiliates; (j) the occurrence of a default or an event of default (however
defined) under any instrument, agreement or other document evidencing or
relating to, and the acceleration of, any indebtedness or other monetary
obligation of Lessee or any Guarantor having a principal amount, in the
aggregate, in excess of $5,000,000; (k) any judgment or order for the payment
of money (not paid or fully covered by insurance and as to which the relevant
insurance company has acknowledged coverage), or any liability of Lessee or any
Guaranty pursuant to ERISA, in excess of $5,000,000 shall be rendered against
Lessee or any Guarantor; (l) any Lease Document or any lien granted thereunder
shall (except in accordance with its terms), in whole or in part, terminate,
cease to be effective or cease to be the legally valid, binding and enforceable
obligation of Lessee; Lessee, Guarantor or any other party shall, directly or
indirectly, contest in any manner the effectiveness, validity, binding nature
or enforceability of any Lease Document or any guaranty or any lien granted
thereunder; or any lien securing (or required to secure) any of Lessee's
obligations shall, in whole or in part, cease to be a first priority perfected
lien; (m) the occurrence of a material adverse change in the financial
condition, assets, operations or business prospects, taken as a whole, of
Lessee or any Guarantor; or (n) the occurrence of any other event constituting
an "Event of Default" as described in any Lease Document.
16. Remedies. Following the occurrence of any Event of Default, Lessor may,
with or without cancelling any or all Leases held by such Lessor, in its sole
discretion, do any one or more of the following: (a) upon written notice to
Lessee, cancel this Master Lease and any or all Leases held by such Lessor;
(b) upon written notice to Lessee, declare immediately due and payable all sums
due and to become due under any or all Leases held by such Lessor for the full
Term respecting the Equipment subject to such Leases (including any renewal or
purchase options which Lessee has contracted to pay); (c) with or without
terminating any or all Leases held by such Lessor, recover the Stipulated Loss
Value for all Equipment as of the payment date immediately preceding Lessee's
date of default plus interest on such Stipulated Loss Value at a rate equal to
the lesser of (i) 18% per annum and (ii) the highest rate permitted by
applicable law (the "Default Rate") until paid and all commercially reasonable
costs and expenses incurred by Lessor in the repossession, recovery, storage,
repair, sale, re-lease or other disposition of the Equipment, including
attorneys' fees and costs incurred in connection therewith or otherwise
resulting from or in connection with Lessee's default plus any indemnity
amounts, if then determinable, plus interest at the Default Rate; (d) with or
without notice to Lessee, repossess the Equipment wherever found, with or
without legal process, and for this purpose Lessor and/or its agents may enter
upon any premises of or under the control or jurisdiction of Lessee or any
agent of Lessee, without liability for suit, action or other proceeding by
Lessee (any damages occasioned by such repossession being hereby expressly
waived by Lessee) and remove the Equipment therefrom, and Lessee further agrees
on demand, to assemble the Equipment and make it available to Lessor at a place
to be designated by Lessor; (e) require Lessee to assemble the Equipment at a
location within the continental United States as Lessor shall direct, which
assembly shall be in accordance with Section 10; (f) re-lease, sell or
otherwise dispose of any or all of the Equipment, whether or not in Lessor's
possession, at a public or private sale on such terms and notice as Lessor
shall deem reasonable (such sale may, at Lessor's sole option, be conducted at
Lessee's premises), and recover from Lessee damages, not as a penalty, but
herein liquidated for all purposes and in an amount equal to the excess, if
any, of (i) the sum of (A) the aggregate Stipulated Loss Value for all
Equipment; (B) all costs and expenses incurred by Lessor in any repossession,
recovery, storage, repair, sale, re-lease or other disposition of the
Equipment, including attorneys' fees and costs incurred in connection with or
otherwise resulting from Lessee's default and (C) any indemnity amounts, if
then determinable, plus interest at the Default Rate over (ii) the amount
received by Lessor upon such public or private sale or re-lease of such items
of Equipment, if any or (g) exercise any other right or remedy which may be
available to it under the applicable UCC or any other applicable law.
The foregoing remedies are cumulative, and any or all thereof may be exercised
instead of or in addition to each other or any other remedies at law or in
equity until Lessee's obligations to Lessor under this Master Lease and the
Lease Documents are indefeasibly satisfied in full. Lessee waives notice of
sale or other disposition (and the time and place thereof), and the manner and
place of advertising. Lessee shall pay Lessor's actual attorney's fees
incurred in connection with the enforcement, assertion, defense or preservation
of Lessor's rights and remedies under this Master Lease or a Lease or if
prohibited by law, such lesser amount as may be permitted.
No waiver of any Default or any Event of Default shall be effective unless in
writing and executed by Lessor. Waiver of any Default or any Event of Default
shall not be deemed a waiver of any other or subsequent Default or Event of
Default.
A cancellation of a Lease shall occur only upon written notice by Lessor and
only as to such Lease as Lessor specifically elects to cancel and all other
Leases not included in any such notice of cancellation shall continue in full
force and effect.
17. Security; Filings. In order to secure all of Lessee's obligations (both
now existing and hereinafter arising) under any Lease Document, Lessee hereby
grants to Lessor a first priority security interest in the Equipment,
including all accessories, attachments, parts, repairs, additions, upgrades and
accessions thereto and all replacements and substitutions therefor, together
with (a) all general intangibles relating to the foregoing property, (b) all
documents relating to the foregoing property, (c) any cash or cash equivalent
deposits made by Lessee to Lessor comprising a security deposit, (d) all
accounts, chattel paper and general intangibles arising out of the sale,
transfer or other disposition of any of the foregoing property, (e) all of
Lessee's rights to receive the return of any premiums for, or proceeds of, any
insurance, condemnation award, indemnity, warranty or guaranty with respect to
any of the foregoing property and (f) all products and proceeds of any of the
foregoing property. If any Lease is deemed at any time to be one intended as
security, Lessee agrees that the Equipment shall secure, in addition to the
indebtedness set forth in such Lease, indebtedness at any time owing by Lessee
to Lessor or its affiliates.
Lessor is authorized to file one or more UCC financing statements,
precautionary or otherwise, as appropriate, disclosing Lessor's interest in the
Equipment, a Lease and the sums due under a Lease, without the signature of
Lessee or signed by Lessor as attorney-in-fact for Lessee. Lessee hereby
appoints Lessor (and any of Lessor's officers, employees, or agents designated
by Lessor) as Lessee's attorney, coupled with an interest, to do all things
necessary to carry out this paragraph. Lessee hereby waives any right that
Lessee may have to file with the applicable filing officer, and agrees that it
shall not file or authorize the filing of, any financing statement, amendment,
termination or other record pertaining to the Equipment and/or Lessor's
interest therein, except as authorized by Lessor in writing. Lessee shall pay
all costs of filing any financing, continuation or termination statements with
respect to a Lease and the Equipment, including, without limitation, any
intangibles tax and/or documentary stamp taxes relating thereto. Lessee shall
do whatever may be necessary to have a statement of the interest of Lessor in
the Equipment noted on any certificate of title relating to the Equipment and
shall deliver said certificate to Lessor.
18. Lessor's Fees and Expenses; Indemnity. Lessee shall reimburse Lessor for
all charges, costs, expenses and attorneys' fees and expenses, incurred by
Lessor in connection with (a) defending or protecting its interests in the
Equipment (b) the execution, delivery, administration, amendment or enforcement
of this Master Lease or any Lease or the collection of any installment of Rent
under a Lease and (c) any lawsuit or other legal proceeding to which this
Master Lease or any Lease or any Equipment is related, including, without
limitation, actions in tort. Lessee shall indemnify and hold Lessor and its
affiliates and its and their respective officers, directors, employees and
agents (individually and collective, the "Indemnified Parties") harmless from
and against all claims, losses, liabilities (including negligence, tort and
strict liability), damages, judgments, suits and all legal proceedings and any
and all costs and expenses in connection therewith (including attorneys' fees
and expenses) that in any way relate to or arise out of any of this Master
Lease, any Lease Document, the transactions contemplated thereby or the
Equipment, including, without limitation, (i) the selection, manufacture,
purchase, financing, acceptance or rejection of the Equipment, (ii) the
ownership of the Equipment, (iii) the delivery, nondelivery, installation,
lease, possession, maintenance, use, condition, repair, return, operation or
disposition of the Equipment, (iv) the condition of the Equipment sold or
otherwise disposed of after possession by Lessee, (v) any patent, copyright or
trademark infringement, (vi) any act or omission on the part of Lessee, any
Guarantor or any of its or their officers, employees, agents, contractors,
lessees, licensees or invitees, (vii) any misrepresentation or inaccuracy in
any representation or warranty of Lessee or any Guarantor, or a breach of
Lessee or any Guarantor of any of its covenants or obligations under any of the
Lease Document or any guaranty, (viii) any claim, loss, cost or expense
involving alleged damage to the environment relating to the Equipment,
including, without limitation, investigation, removal, cleanup and remedial
costs, (ix) any personal injury, wrongful death or property damage arising
under any statutory or common law or tort law theory, including, without
limitation, damages assessed for the maintenance of a private or public
nuisance or for the conducting of an abnormally dangerous activity on or near
the Equipment, (x) any past, present or threatened injury to, or destruction
of, the Equipment, including, without limitation, costs to investigate and
assess such injury or damage, (xi) any administrative process or proceeding or
judicial or other similar proceeding (including, without limitation, any
alternative dispute resolution process and any bankruptcy proceeding) in any
way connected with any matter addressed in any of the Lease Documents or (xii)
any latent or other defects in the Equipment whether or not discoverable by
Lessor. Lessee agrees to give Lessor prompt notice of any such claim or
liability. All the rights, privileges and indemnities contained in this
Section shall survive the expiration or other termination of any Lease.
19. Income Tax Indemnity. Except as otherwise provided in a Schedule:
(a) Lessee represents, warrants and agrees that: (i) Lessor is the owner of
the Equipment for state law and federal income tax purposes, (ii) Lessor
intends to take depreciation deductions ("Depreciation Deductions") with
respect to the Equipment in accordance with Section 168 of the Internal
Revenue Code of 1986, as amended and (iii) the Equipment leased under the
Lease shall qualify for all Depreciation Deductions in the hands of Lessor and
at no time during the Term respecting Equipment shall Lessee take or omit to
take, nor shall it permit any sublessee or assignee to take or omit to take,
any action (whether or not such act or omission is otherwise permitted by
Lessor or by the Lease), which shall result in the disqualification of any
Equipment for, or recapture of, all or any portion of such Depreciation
Deductions.
(b) If for any reason whatsoever, including, without limitation, any act or
omission of Lessee or any breach of any representation, warranty or covenant of
Lessee contained in this Master Lease or any Lease Document, (i) independent
tax counsel to Lessor shall determine that Lessor is not entitled to claim on
its Federal income tax return all or any portion of the Depreciation Deductions
with respect to any Equipment, (ii) any Depreciation Deduction claimed on the
Federal or state income tax return of Lessor is disallowed or adjusted by the
Internal Revenue Service or (iii) any Depreciation Deduction is recalculated or
recaptured (any determination, disallowance, adjustment, recalculation or
recapture being a "Loss"), then Lessee shall pay to Lessor, as an indemnity and
as additional rent, an amount that, after deduction of all Federal, state and
local taxes required to be paid by Lessor in respect of the receipt of such
payment, shall provide Lessor with not less than the same net after-tax return
that Lessor would have realized if such Loss had not occurred, including,
without limitation, any interest and penalties payable by Lessor attributable
to such Loss. In computing Lessee's liability under this Section, the
Federal, state and local taxes payable by Lessor shall be based upon the
highest marginal corporate tax rate in effect for the taxable year in which the
Loss occurred.
(c) Lessee shall pay to Lessor the indemnity payment described in subsection
(b) of this Section within 30 days of written notice to Lessee by Lessor of the
occurrence of a Loss. For these purposes, a Loss shall occur upon the earliest
of: (i) the happening of any event (such as disposition or change in use of
any item of the Equipment) which would cause such Loss, (ii) the payment by
Lessor to the Internal Revenue Service or state taxing authority of the tax
increase (including an increase in estimated taxes) resulting from such Loss;
(iii) the date on which the Loss is realized by Lessor or (iv) the adjustment
of the tax return of Lessor to reflect such Loss.
(d) All references to Lessor in this Section shall include Lessor and the
consolidated taxpayer group of which Lessor is a member. All of Lessor's
rights, privileges and indemnities contained in this Section shall survive the
expiration or other termination of any Lease. The rights, privileges and
indemnities contained herein are expressly made for the benefit of, and shall
be enforceable by Lessor, its successors and assigns.
20. Waivers. To the extent permitted by applicable law, Lessee hereby waives
any and all rights and remedies conferred upon a Lessee by Sections 2A-508
through 2A-522 of the UCC, including, without limitation, Lessee's rights to
(a) cancel any Lease; (b) repudiate any Lease; (c) reject any Equipment;
(d) revoke acceptance of any Equipment; (e) recover damages from Lessor for any
breaches of warranty or for any other reason; (f) a security interest in the
Equipment in Lessee's possession or control for any reason; (g) deduct from
Rent owed all or any part of any claimed damages resulting from Lessor's
default, if any, under any Lease; (h) accept partial delivery of the Equipment;
(i) "cover" by making any purchase or lease of or contract to purchase or
lease Equipment in substitution for those due from Lessor; (j) recover any
general, special, incidental or consequential damages for any reason
whatsoever; and (k) specific performance, replevin, detinue, sequestration,
claim and delivery or the like for any Equipment identified in any Lease. To
the extent permitted by applicable law, Lessee also hereby waives any rights
now or hereafter conferred by statute or otherwise which may require Lessor to
sell, lease or otherwise use any Equipment in mitigation of Lessor's damages as
set forth in Section 16 or which may otherwise limit or modify any of Lessor's
rights or remedies under Section 16.
21. Performance by Lessor; Further Assurances. If Lessee fails to perform or
comply with any provisions contained herein or in a Lease, Lessor may perform
or comply with such provisions, and the amount of any payments and expenses of
Lessor incurred in connection with such performance or compliance (including
attorneys' fees and expenses), together with interest thereon at the Default
Rate, shall be deemed additional Rent payable by Lessee upon demand. Lessee
shall cooperate with Lessor for the purpose of protecting the interests of
Lessor in the Equipment, a Lease and the sums due under a Lease. Lessee hereby
appoints Lessor (and any of Lessor's officers, employees, or agents designated
by Lessor) as Lessee's attorney, coupled with an interest, to do all things
necessary to carry out this Section. Lessee shall execute and deliver to
Lessor upon request such other instruments and assurances as Lessor deems
necessary or advisable for the implementation, effectuation, confirmation or
perfection of a Lease and any rights of Lessor thereunder.
22. Notices. All notices, certificates, requests, demands and other
communications provided for under a Lease shall be in writing and shall be (a)
personally delivered or (b) sent by overnight courier of national reputation,
and shall be deemed to have been given on (i) the date received if personally
delivered and (ii) the next business day if sent by overnight courier. All
communications shall be addressed to the party to whom notice is being given at
its address set forth below its signature hereto, or such other address as such
party may designate in writing to the other party. If notice to Lessee of any
intended disposition of the Equipment or any other intended action is required
by law in a particular instance, such notice shall be deemed commercially
reasonable if given (in the manner specified in this Section) at least 10
calendar days prior to the date of intended disposition or other action.
23. Absolute and Unconditional. Lessee hereby agrees that Lessee's obligation
to pay all Rent and any other amounts owing under a Lease shall be absolute and
unconditional, even if the Equipment is damaged or destroyed, if it is
defective or if Lessee no longer can use it. Lessee is not entitled to reduce,
or set-off against, Rent or other amounts due to Lessor or to anyone to whom
Lessor assigns this Master Lease or any Lease whether Lessee's claim arises out
of this Master Lease, any Lease, any statement by Lessor, Lessor's liability or
any manufacturer's liability, strict liability, negligence or otherwise.
24. Governing Law. THIS MASTER LEASE AND EACH LEASE SHALL EACH BE DEEMED TO BE
A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES THEREOF.
25. Waiver of Jury Trial. LESSOR AND LESSEE HEREBY WAIVE THEIR RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF, DIRECTLY OR INDIRECTLY, THIS MASTER LEASE OR ANY LEASE, ANY DEALINGS
BETWEEN LESSOR AND LESSEE RELATING TO THE SUBJECT MATTER OF THE TRANSACTIONS
CONTEMPLATED BY THIS MASTER LEASE OR ANY LEASE, AND/OR THE RELATIONSHIP THAT IS
BEING ESTABLISHED BETWEEN LESSOR AND LESSEE. LESSEE ACKNOWLEDGES AND AGREES
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR LESSOR'S ENTERING INTO THIS
MASTER LEASE AND EACH LEASE. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL
ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT (INCLUDING,
WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL
OTHER COMMON LAW AND STATUTORY CLAIMS). THIS WAIVER IS IRREVOCABLE, MEANING
THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO
THIS MASTER LEASE, ANY LEASE OR ANY OTHER LEASE DOCUMENT RELATING TO THE
TRANSACTIONS CONTEMPLATED BY THIS MASTER LEASE OR A LEASE. IN THE EVENT OF
LITIGATION, THIS MASTER LEASE MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY
THE COURT.
26. Forum Selection and Consent to Jurisdiction. LESSEE AND LESSOR HEREBY
IRREVOCABLY SUBMIT TO THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK AND ANY COURT IN THE STATE OF NEW YORK
LOCATED IN THE CITY AND COUNTY OF NEW YORK, AND ANY APPELLATE COURT FROM ANY
THEREOF, IN ANY ACTION, SUIT OR PROCEEDING BROUGHT AGAINST IT AND TO OR IN
CONNECTION WITH THIS MASTER LEASE OR ANY LEASE OR THE TRANSACTIONS CONTEMPLATED
THEREUNDER OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT; PROVIDED,
HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST THE EQUIPMENT MAY BE
BROUGHT, AT LESSOR'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
EQUIPMENT MAY BE FOUND. LESSEE HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE
JURISDICTION OF SUCH COURTS FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH
ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN
CONNECTION WITH SUCH LITIGATION. LESSEE FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE
WITHIN OR WITHOUT THE STATE OF NEW YORK. LESSEE HEREBY EXPRESSLY AND
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION
BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH
LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT
LESSEE HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT
FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO
JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF
OR ITS PROPERTY, LESSEE HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF
ITS OBLIGATIONS UNDER THIS MASTER LEASE AND ANY LEASE. ANY ACTION BY LESSEE
AGAINST LESSOR FOR ANY CAUSE OF ACTION IN CONNECTION WITH THIS MASTER LEASE OR
ANY LEASE DOCUMENT OR THE RESULTING LEASE SHALL BE BROUGHT WITHIN ONE YEAR
AFTER ANY SUCH CAUSE OF ACTION FIRST OCCURS.
27. Assignment by Lessor. Lessor may assign or transfer this Master Lease
and/or a Lease and/or Lessor's interest in the Equipment without the consent
of, or notice to, Lessee. Any assignee of Lessor shall have all of the rights,
but none of the obligations, of Lessor under this Master Lease and/or such
assigned Lease, as applicable, and Lessee agrees that it will not assert
against any assignee of Lessor any defense, counterclaim or offset that Lessee
may have against Lessor and that upon notice of such assignment or transfer, it
shall pay all Rent and other sums due under such assigned Lease to such
assignee or transferee. Lessee also agrees to confirm in writing the receipt
of the notice of assignment and such other matters as may be requested by any
assignee. In the event Lessor assigns a Lease, the term "Equipment" as used
herein or in any Lease Document with respect to such assignee shall mean only
the Equipment described on the Schedules held by such assignee, the term "
Lessor" as used herein or in any Lease Document with respect to such assignee
shall mean only the assignee and the term "Lease" as used herein or in any
Lease Document with respect to such assignee shall mean only the Lease(s) (as
defined in Section 1 above) held by such assignee. Lessee acknowledges and
agrees that any assignment or transfer by Lessor shall not materially change
Lessee's duties or obligations under this Master Lease or any Lease nor
materially increase the burdens or risks imposed on Lessee.
28. Miscellaneous. Lessor's failure at any time to require strict performance
by Lessee of any of the provisions hereof shall not waive or diminish Lessor's
right thereafter to demand strict compliance therewith or with any other
provision. Time is of the essence with respect to the obligations of Lessee
under this Master Lease and each Lease. It is the intention of the parties
hereto to comply with any applicable usury laws; accordingly, it is agreed
that, notwithstanding any provisions to the contrary in this Master Lease or
any Lease, in no event shall this Master Lease or any Lease require the payment
or permit the collection of interest or any amount in the nature of interest or
fees in excess of the maximum permitted by applicable law. Any provision of
this Master Lease or a Lease which is 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. The captions
in this Master Lease are for convenience only and shall not define or limit any
of the terms hereof. All representations, warranties, covenants and
indemnities of Lessee made or agreed to in this Master Lease, any Lease and any
certificates delivered in connection herewith or therewith shall survive the
expiration, termination or cancellation of a Lease for any reason. This Master
Lease, together with the Schedules, Riders and supplements related thereto
executed and delivered by Lessor and Lessee, constitute the entire
understanding and agreement between Lessor and Lessee and there is no
understanding or agreement, oral or written, which is not set forth therein.
This Master Lease may not be amended except by a writing signed by Lessor and
Lessee and shall be binding upon and inure to the benefit of the parties
hereto, their permitted successors and assigns. This Master Lease and any
Schedule may be executed in several counterparts, each of which shall be an
original and all of which shall constitute one and the same document, and any
of the parties hereto may execute this Master Lease or a Schedule by signing
any such counterpart; provided, however, to the extent that any Schedule would
constitute chattel paper, as such term is defined in the UCC as in effect in
any applicable jurisdiction, no security interest therein may be created
through the transfer or possession of this Master Lease in and of itself
without the transfer or possession of the original of such Schedule, and no
security interest in a Schedule may be created by the transfer or possession of
any counterpart of such Schedule other than the original thereof, which shall
be identified as the document marked "Original No. 1 of 2."
[REMAINDER OF PAGE INTENTIONALLY BLANK; EXECUTION PAGE FOLLOWS.]
IN WITNESS WHEREOF, the parties hereto have caused this Master Lease Agreement
to be executed in their respective corporate names by their duly authorized
officers, all as of the date first written above.
LESSEE:
/S/ THE PEP BOYS-MANNY, MOE & XXXX
/S/THE PEP BOYS XXXXX XXX & XXXX OF CALIFORNIA
/S/PEP BOYS - MANNY, MOE & XXXX OF DELAWARE, INC.
/S/PEP BOYS - MANNY, MOE & XXXX OF PUERTO RICO, INC.
LESSOR:
/S/RBS LOMBARD, INC.
