EXHIBIT A
This exhibit dated February 17, 1998 incorporates the Master Lease dated
February 17, 1998 between NBD Bank as Lessor and Darling International Inc. as
Lessee.
January 15, 1998
Mr. Xxxx Xxxxxxxx
Treasurer
Darling International Inc.
000 X'Xxxxxx Xxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Dear Xxxx:
At the request of Xxxx Xxxxx and Xxx Xxxxxxx, I am providing this letter which
outlines the general terms and conditions under which NBD Bank, ("Lessor")
proposes to purchase Cleanstar 2000 Automated Grease Recycling Systems
("Equipment") for the purpose of leasing the Equipment to Darling International
Inc. ("Lessee").
I. TRANSACTION INFORMATION
Acceptance Date: Not later than December 31, 1998
----------------
Equipment Cost: Not to exceed $15,000,000
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Base Lease Term: 84 monthly payments in advance.
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Rental Rates: Funding Date: Rental Factor:
------------- ------------- --------------
On or before 3/31/98 .0139936
4/1/98 to 6/30/98 .0139163
7/1/98 to 9/30/98 .0138443
10/1/98 to 12/31/98 .0137713
Early Buyout Options:
---------------------
Upon 30 days written notice, at the 42nd scheduled monthly
payment date, purchase the equipment for 58% of original equipment
cost, OR
Upon 30 days written notice, at the 66th scheduled monthly
payment date, purchase the equipment for 29% of original equipment
cost.
End of Lease Options:
---------------------
A. Purchase all but not less than all the equipment at the then
fair market value
or
B. Return the equipment to Lessor with a 5% return
fee based on original equipment cost.
or
C. Re-rent the equipment at the then fair market
value rental.
II. LEASE PROPOSAL PROVISIONS
Rental Adjustment:
------------------
The rental factor quoted above will be adjusted by the following
factors for each basis point increase or decrease, or prorated portion
thereof, in the yield of the corresponding Treasury Note issue as
published in the Wall Street Journal:
Funding Date: Adjustment Factor:
------------- ------------------
1/1/98 through 6/30/98 .0000040
7/1/98 through 9/30/98 .0000038
10/1/98 through 12/31/98 .0000037
The rental factor will continue to be subject to adjustment until the
Lessor has been notified that the Equipment has been delivered and
accepted by the Lessee. Upon such notification, the Lessor will fix the
rental factor and prepare the necessary documentation for execution by
the Lessee. Funding must occur within 5 business days of rate setting
or the rate may be adjusted.
The Treasury Note issue for this transaction is the 6 1/4% note dated
February 2003 with a yield of 5.36% as published in the Wall Street
Journal dated January 15, 1998.
Lease Schedules:
----------------
All schedules funded under the Master Lease agreement will share the
same invoice date, the first day of the month following acceptance of
Equipment. Equipment initial delivery locations, for the purposes of
UCC filings and lease documentation, will be limited to the
approximately 20 regional Darling International plants, and then may be
kept at customer locations as provided in the Master Lease. Lessee will
provide a detailed listing of all Equipment by location on a semiannual
basis.
Advances:
---------
Advances toward the purchase of the asset(s) to be leased will be made
under a Purchase Agreement Assignment. Moneys will be advanced on a
demand note basis with monthly payments of interest which accrue
interest at the same interest rate charged under Darling International
Inc's Senior Credit Facility with First Chicago NBD and other lenders
dated June 5, 1997. Pricing is indexed over LIBOR and is adjusted
quarterly. Current pricing is LIBOR plus 1.25 percentage points.
Interim Rent:
-------------
If the funding date is a date other than the rental payment date, the
Lessee will pay to Lessor Interim Rent at the daily rate of First
Chicago NBD's Prime Rate minus 1/2% (one-half percent) from the date of
funding to the Lease Commencement Date (the first day of the month
following acceptance of Equipment). Interim Rent will be billed
separately to Lessee at the time of Equipment acceptance.
Net Lease
---------
The Lessee will be responsible for all expenses incurred in connection
with the Equipment and the Lease, including those relating the
ownership, operation, maintenance, modifications, insurance, and taxes
(excluding, however, subject to customary limitations, taxes imposed
on, or measured solely by, the net income of the Lessor). The Lessor
will make no warranties of any kind with respect to the Equipment.
Lessee shall bear all risk of loss.
Environmental Indemnification:
------------------------------
Darling International Inc. will indemnify NBD Bank for any and all
liability arising from ownership of the Cleanstar 2000 units as
covered by the General Indemnity language referenced below.
General Indemnity
-----------------
The lease documents will include a general indemnity section which will
include provisions which are customary in transactions of this type.
III. TAX MATTERS
Tax Assumptions
---------------
The proposed Rental Payments have been calculated based on the
following assumptions for Federal Income Tax purposes: (i) five (5)
year depreciation (MACRS); (ii) marginal Corporate Federal income tax
rate of 35%; (iii) treatment of all income and loss deductions as U.S.
sourced; (iv) absence of income inclusions ("Tax Benefits").
Lessee Income Tax Representation and Warranties
-----------------------------------------------
Lessee will represent, warrant and covenant as to certain customary
tax matters, including that for Federal Income Tax purposes the
Equipment will constitute "five year Property", eligible to be
depreciated over a recovery period of five years, in accordance with
the provisions of Section 168 of the Internal Revenue Code of 1986.
General Tax Indemnity
---------------------
The Lessee will extend to the Lessor a general tax indemnity on
customary terms, and with customary exceptions, all mutually
satisfactory to the parties, covering all taxes imposed by Federal,
state, local and foreign taxing authorities.
Lessee will be responsible for all tax documentation and payment of all
personal property tax required on the Equipment. Lessee will indemnify
Lessor from any and all liability arising from such property taxes.
IV. MISCELLANEOUS
Transactions Costs
------------------
All fees and expenses relating to the transaction, incurred by the
Lessee and Lessor will be paid by the Lessee and Xxxxxx respectively,
except that certain out-of-pocket expenses incurred by the Lessor will
be payable by the Lessee. Out-of-pocket expenses may include, but not
be limited to, such items as UCC searches and filings.
Business Information
--------------------
Lessee shall make available to Lessor such financial and other business
information as may be reasonably requested.
Material Adverse Change
-----------------------
There will not have occurred, prior to the initial Funding Date, in the
opinion of Lessor, any material adverse change in the financial
position or in the circumstances involving the nature or the operation
of Xxxxxx's business or equipment.
The terms and conditions stated in this proposal are supplementary to the Master
Lease and Schedules thereto. Any terms and conditions not specifically addressed
in this proposal shall be subject to mutual agreement between Lessee and Lessor,
and will be addressed in the lease documents.
Sincerely,
Xxxxxxx X. Xxxxx
Vice President
cc: Xxxx Xxxxx
Xxx Xxxxxxx
FCNBD
Accepted By:
DARLING INTERNATIONAL INC.
-----------------------------------
(Signature)
-----------------------------------
(Title)
-----------------------------------
(Date)
MASTER LEASE
This Master Lease Agreement ("Master Lease") is dated February 17, 1998, between
NBD BANK ("Lessor"), and Darling International Inc. ("Lessee").
Xxxxxx wants from time to time to lease from Lessor personal property to be
described in one or more schedules ("Schedule") of leased equipment. Lessor is
willing to lease such personal property to Xxxxxx at the rent, for the term and
upon the conditions stated. Any Schedules and exhibits executed by Xxxxxx and
Xxxxxx which are identified as being a part of this Master Lease, shall be
deemed to incorporate by reference all the terms of this Master Lease except as
provided in the Schedules and exhibits. In the event of a conflict between this
Master Lease and any Schedule or exhibit, the provisions of such Schedule or
exhibit shall control.
1. Equipment Leased and Term. This Master Lease shall cover such personal
property as is described in any Schedule (the "Equipment") executed by the
parties. Lessor leases to Lessee and Lessee hires and takes from Lessor, subject
to the conditions of this Master Lease, the Equipment described in any Schedule.
The term for any item of Equipment shall be for the period as set forth in the
Schedule ("Initial Lease Term").
2. Rent. The rent for each item of Equipment shall be payable as, and in the
amount, shown on the Schedule.
3. Purchase and Acceptance. Lessee requests Lessor to acquire all scheduled
Equipment pursuant to an assignment of Xxxxxx's purchase order(s) for the
Equipment. Delivery of each item of Equipment shall be deemed complete upon the
acceptance date ("Acceptance Date") stated in the Schedule. Lessor shall not be
liable for loss or damage or for the delay or failure of any supplier of the
Equipment ("Seller") to deliver any item of Equipment. THE LESSEE REPRESENTS
THAT XXXXXX HAS SELECTED BOTH THE EQUIPMENT LISTED IN ANY SCHEDULE AND THE
SELLER BEFORE HAVING REQUESTED XXXXXX TO ACQUIRE THE EQUIPMENT FOR LEASING TO
LESSEE.
4. Non-Cancelable Lease. THIS MASTER LEASE IS NON-CANCELABLE. When Lessee signs
and delivers a Certificate of Acceptance for the Equipment, its obligations to
pay all rent and other amounts (subject to the further provisions of this Master
Lease) for the Initial Lease Term and to perform as required under this Master
Lease are unconditional, irrevocable and independent. These obligations are not
subject to cancellation, termination, modification, repudiation, excuse or
substitution by Xxxxxx. Xxxxxx is not entitled to any abatement, reduction,
offset, defense or counterclaim with respect to these obligations for any reason
whatsoever, whether arising out of default or other claims against Lessor, the
Seller or the manufacturer of the Equipment, defects in or damage to the
Equipment, its loss or destruction.
5. Disclaimer of Warranties by Xxxxxx; Rights of Xxxxxx. LESSOR MAKES NO
WARRANTY, EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING THE
CONDITION OF THE EQUIPMENT, ITS MERCHANTABILITY OR ITS FITNESS FOR ANY
PARTICULAR PURPOSE, AND, AS TO LESSOR, LESSEE LEASES THE EQUIPMENT "AS-IS".
UNDER NO CIRCUMSTANCES SHALL LESSOR BE RESPONSIBLE FOR ANY INCIDENTAL OR
CONSEQUENTIAL DAMAGES IN CONNECTION WITH THIS MASTER LEASE AND/OR THE EQUIPMENT.
XXXXXX IS ENTITLED TO THE PROMISES AND WARRANTIES, INCLUDING THOSE OF ANY THIRD
PARTY, PROVIDED TO LESSOR BY THE SELLER IN CONNECTION WITH OR AS PART OF THE
CONTRACT BY WHICH XXXXXX ACQUIRED THE EQUIPMENT. XXXXXX MAY COMMUNICATE WITH THE
SELLER AND RECEIVE AN ACCURATE AND COMPLETE STATEMENT OF THOSE RIGHTS, PROMISES
AND WARRANTIES, INCLUDING ANY DISCLAIMERS AND LIMITATIONS OF THEM OR OF
REMEDIES.
6. Claims Against Seller; Seller Not An Agent of Lessor. If the Equipment is not
properly installed, does not operate as represented or warranted by the Seller
or is unsatisfactory for any reason, Lessee shall make any claim for same solely
against the Seller and shall nevertheless pay Lessor all rent payable under this
Master Lease. Xxxxxx agrees to assign to Xxxxxx, solely for the purpose of
making and prosecuting any such claim, any rights it may have against the Seller
for breach of warranty or representation regarding the Equipment.
Notwithstanding any fees that must be paid to Seller or any agent of Seller,
Xxxxxx understands and agrees that neither the Seller nor any agent or employee
of the Seller is an agent or employee of the Lessor and that neither the Seller
nor its agent or employee is authorized to waive or alter any term or condition
of this Master Lease.
7. Title; Location of the Equipment; Equipment is Personal Property;
Termination. Title to the Equipment is in the Lessor and under no circumstances
shall pass to Xxxxxx. The Equipment shall be kept at Lessee's address indicated
in the applicable Schedule and shall not be removed without the prior written
consent of Lessor, except that Equipment may be kept at customer locations as
indicated in the applicable schedule provided from Lessee to Lessor at six month
intervals. Xxxxxx agrees that the Equipment is, and will at all times remain,
personal property. At each scheduled termination date, or upon Lessee's default,
Lessee, at its own expense, shall assemble and deliver the Equipment to Lessor
at the location designated by Lessor, in good order and repair, ordinary wear
and tear excepted. Lessee shall give Lessor 90 days written notice prior to each
scheduled termination date, that it is returning the Equipment.
8. No Assignment by Xxxxxx; Assignment by Xxxxxx. THIS MASTER LEASE SHALL NOT BE
ASSIGNED BY XXXXXX, NOR SHALL ANY OF THE EQUIPMENT BE SUBLEASED BY LESSEE
WITHOUT THE PRIOR WRITTEN CONSENT OF LESSOR WHICH CONSENT SHALL NOT BE
UNREASONABLY WITHELD; PROVIDED, HOWEVER, THAT THIS LIMITATION ON SUBLEASING
SHALL NOT APPLY TO LEASES OR RENTALS OF INDIVIDUAL CLEANSTAR UNITS OR GROUPS OF
CLEANSTAR UNITS MADE IN THE ORDINARY COURSE OF LESSEE'S BUSINESS AND IN
CONNECTION WITH XXXXXX'S SERVICES PROVIDED TO GENERATORS OF SPENT COOKING OIL.
Lessor may sell or assign all or part of its right, title and interest in this
Master Lease, any item of Equipment and/or any Schedule and/or exhibit and in
any monies to become due to the Lessor. The assignee shall not be liable for or
be required to perform any of Lessor's obligations to Lessee. In the event of an
assignment by Xxxxxx of this Master Xxxxx, such assignment will not relieve
Xxxxxx from its duties and obligations hereunder or be construed to be an
assumption by the assignee of such obligations. All assigned rental payments
shall be paid directly to assignee, upon written notice to Lessee of such
assignment. Lessee's performance of all its obligations shall not be subject to
any defense, counterclaim or setoff which the Lessee may have against Lessor.
Xxxxxx agrees that it will not assert any such defenses, setoffs, counterclaims
or claims against the assignee.
9. Casualty and Liability Insurance; Risk of Loss; Damage or Destruction. Lessee
shall keep all Equipment insured against loss by fire, theft and all other
hazards (comprehensive coverage) for its replacement cost but not less than the
casualty value ("Casualty Value") for such item indicated in the Casualty Value
Table attached to the applicable Schedule. Lessee may self-insure for damage to
the equipment resulting from fire, theft, and all other hazards. Should Lessee
choose to self-insure Physical Damage, it will provide Lessor with a letter
acknowledging Xxxxxx's interest and agreeing to respond as the lease requires to
any loss. Lessee shall also insure the Lessor and Lessee with respect to
liability for personal injuries in amounts of at least $1,000,000 per bodily
injury per ocurrence, $3,000,000 per occurrence; and $1,000,000 per occurrence
for damage to or loss of use of property resulting from the ownership, use and
operation of the Equipment and against risks customarily insured against by the
Lessee for equipment owned by it. All policies shall be endorsed with Lessor as
a loss payee and additional insured and shall provide that the interest of
Lessor shall not be invalidated by any act of Lessee. Evidence of insurance must
be delivered to Lessor annually by April 15th. In the event of loss, destruction
or theft of, or damage to, any of the Equipment, Lessee will notify Lessor as
soon as practicable.
If Lessee defaults in obtaining any insurance, Lessor may but is not required
to, place such insurance. Any premiums paid by Lessor shall be additional rent
payable on demand with interest at the rate referenced in Section 23 of this
Master Lease from the date of payment. At Lessor's sole option, such amounts
together with interest may be added to the lease balance to be paid by Xxxxxx as
additional monthly rent. Lessee assumes and shall bear all risks of loss of,
damage to or destruction of each item of Equipment, whether partial or complete.
Except as provided in this Section 9, no such event shall relieve the Lessee of
its obligation to pay the full rental payable for such item.
If any item of Equipment is destroyed, damaged beyond economical repair, lost or
stolen, or taken by governmental action for a stated period extending beyond the
Initial Lease Term for such item (an "Event of Loss"), Lessee must promptly
notify Lessor and any assignee and pay to Lessor or the assignee, as the case
may be, on the next rent payment date following the Event of Loss the Casualty
Value of the item of Equipment. Upon such payment, Xxxxxx's obligation to pay
rent for such item of Equipment will cease and provided no Event of Default as
defined in Section 12 has occurred and is continuing, Lessee will be entitled to
receive any insurance proceeds or other recovery received by the Lessor or
assignee in connection with the Event of Loss.
10. Repairs; Use; Alterations; Attachments. Lessee, at its own expense, shall
keep the Equipment maintained in good repair, condition, working order, and in
accordance with the manufacturer's recommended maintenance procedures and
specifications, normal wear and tear excepted; shall use the Equipment lawfully;
and shall not materially alter the Equipment without the Lessor's prior written
consent. Lessee shall take no action which would void the manufacturer's
warranty on the Equipment. All items which become attached to or a part of the
Equipment become the property of Lessor.
11. Liens and Taxes. Lessee at its expense shall keep the Equipment free and
clear of all levies and liens. Lessee shall reimburse the Lessor (or pay
directly if, but only if instructed by Lessor) for all charges and taxes (local,
state and federal) imposed or levied upon this Master Lease, any Schedules,
rentals, operation, leasing, sale, ownership, possession or use of the Equipment
excluding all taxes based upon income or gross receipts of Lessor.
12. Default. Any of the following shall constitute an event of default ("Event
of Default") by Lessee: (a) Lessee fails to pay when due any scheduled rent or
other amount within 3 days as required by this Master Lease; (b) Lessee breaches
any covenant of this Master Lease or fails to promptly perform any of its terms
or conditions, including but not limited to return of the leased Equipment at
the expiration of any scheduled lease term provided Lessee has not exercised its
purchase option with respect to such Equipment; (c) Lessee makes an assignment
for the benefit of creditors; (d) a petition is filed by or against Lessee in
bankruptcy or for the appointment of a receiver and is not dismissed within 60
days; (e) dissolution or suspension of Lessee's usual business; (f) Lessee makes
a bulk transfer or bulk sale of any assets outside the normal course of
business, (g) any representation, warranty, or signature made by Lessee in this
Master Lease or related document is incorrect, fraudulent or breached; or (h)
Lessee defaults under the terms of any agreement or instrument relating to any
lease or debt for borrowed money such that the lessor terminates the lease or
the creditor declares the debt due before its maturity and such lease or debt is
in the principal amount of at least $1,000,000. Xxxxxx agrees to give Xxxxxx
prompt notice upon the occurrence of an Event of Default.
13. Xxxxxx's Remedies upon Default by Xxxxxx. Upon the occurrence and during the
continuance of an Event of Default, Lessor, without further notice, and in
addition to any remedy provided by law, may (i) recover from Lessee the Casualty
Value of the Equipment together with any unpaid rent then due and (ii)
regardless of whether such amounts are paid, take possession of any items of
Equipment and at Lessor's option sell or lease at public auction or by private
sale or otherwise dispose of such items of Equipment.
If Xxxxxx has paid the Casualty Value, all unpaid rent then due and all other
amounts owing under this Master Lease and if any items of Equipment have been
taken from Lessee, the proceeds of any reletting or sale (less all costs and
expenses including reasonable attorneys' fees) shall be paid to reimburse the
Lessee for the Casualty Value up to the amount previously paid. Any surplus
remaining after such payment will be retained by the Lessor.
Regardless of any sale or lease of the Equipment or any payment of the Casualty
Value, Lessee will remain liable to Lessor for all damages as provided by law
and for all costs and expenses caused by Xxxxxx's breach, including court costs
and reasonable attorneys' fees (whether attributable to Xxxxxx's in-house
counsel or outside counsel). These costs and expenses shall include, without
limitation, any costs or expenses incurred by Lessor in any bankruptcy,
reorganization, insolvency or other similar proceeding relating to Lessee.
14. Renewal. If the Equipment is not delivered to Lessor at any scheduled
termination date in accordance with paragraph 7, then the Initial Lease Term
shall renew on a month to month basis upon the same terms and conditions,
subject to the right of Lessor or Lessee to terminate the renewed term on 30
days written notice, in which event, the Equipment shall immediately be returned
to Lessor.
15. Late Charges. Without limiting Xxxxxx's remedies above, if Xxxxxx fails to
pay any amount of rental or other payment for a period of ten days after its due
date, Xxxxxx agrees to pay Lessor a late charge of 5% of each such payment or
installment with a minimum late charge of $25.00. This late charge shall be
reassessed in each subsequent month that the rental or other payment remains
unpaid.
16. Financing Statements. The Lessor is authorized to file a financing statement
in accordance with the Uniform Commercial Code signed by Lessee or by Xxxxxx, as
Xxxxxx's attorney in fact.
17. Jurisdiction; Venue; Severability. THIS AGREEMENT SHALL BE GOVERNED BY THE
LAWS OF THE STATE OF MICHIGAN. No provision which may be construed as
unenforceable shall in any way invalidate any other provision, all of which
shall remain in full force and effect.
18. Warranties by Xxxxxx. Lessee warrants and represents that: (a) the Equipment
is being leased for business purposes; (b) all signatures are genuine; and (c)
the person signing the Master Lease is authorized to do so. If Lessee is other
than a natural person, it further represents that (a) it is duly organized,
existing and in good standing pursuant to the laws under which it is organized;
and (b) the execution and delivery of this Master Lease and the performance of
the obligations it imposes are within its powers and have been duly authorized
by all necessary action of its governing body and do not contravene the terms of
its articles of incorporation or organization, its bylaws, or any partnership,
operating or other agreement governing its affairs:
19. Indemnity by Xxxxxx. XXXXXX AGREES TO INDEMNIFY AND HOLD LESSOR OR ANY
ASSIGNEE HARMLESS FROM ANY AND ALL CLAIMS, ACTIONS, PROCEEDINGS, EXPENSES,
DAMAGES AND LIABILITIES, INCLUDING ATTORNEYS' FEES (collectively "Losses"),
ARISING OUT OF OR IN ANY MANNER PERTAINING TO THE EQUIPMENT OR THIS MASTER LEASE
INCLUDING, WITHOUT LIMITATION, THE OWNERSHIP, SELECTION, POSSESSION, PURCHASE,
DELIVERY, INSTALLATION, LEASING, OPERATION, USE, CONTROL, MAINTENANCE AND RETURN
OF THE EQUIPMENT AND THE RECOVERY OF CLAIMS UNDER INSURANCE POLICIES, EXCEPT TO
THE EXTENT SUCH LOSSES ARE CAUSED BY XXXXXX'S OR ANY ASSIGNEE OF LESSOR'S GROSS
NEGLIGENCE OR WILLFULL MISCONDUCT.
Lessee acknowledges that the Equipment is owned by Lessor ("Owner"). It is the
intent of Owner/Lessor and Lessee that this Lease constitute a true lease for
Federal income tax purposes so that, for the purpose of determining its
liability for Federal income taxes, Owner shall be entitled to the tax benefits
as are provided by the Internal Revenue Code of 1986, as amended, (the "Code")
to an owner of personal property.
In addition notwithstanding any other provision of this Master Lease, if as to
any Equipment, the modified accelerated cost recovery system or depreciation
deductions allowed under the Code shall be lost, disallowed, eliminated,
reduced, recaptured or otherwise unavailable to Lessor for any reason except due
to Lessor's gross negligence or willful misconduct, then Lessee shall pay to
Lessor as additional rent within 30 days after such a loss an amount equal to
the sum of (i) the additional federal, state, local and foreign income or any
other taxes payable as a result of such loss, disallowance, elimination,
reduction, recapture or unavailability of accelerated cost recovery or
depreciation deductions plus (ii) the amount of any interest, penalties or
additions to tax payable by the Lessor as a result of such additional tax.
The indemnities given and liabilities assumed by the Lessee pursuant to this
Section 19 shall continue in full force and effect notwithstanding the
expiration or other termination of this Master Lease.
20. Notices. Notice from one party to another relating to this Master Lease
shall be deemed effective if made in writing (including telecommunications) and
delivered to the recipient's address, telex number or telecopier number set
forth under its name below.
21. Labels Affixed to Equipment. Lessor shall have the right, but not the
obligation, to attach or require Lessee to attach ownership identification
labels to the Equipment. Xxxxxx agrees to not remove any such labels.
22. Lessor's Expense. Lessee shall pay Lessor all reasonable costs and expenses,
including reasonable attorneys' fees, incurred by Lessor in enforcing any terms
of, or in protecting Lessor's interests under, this Master Xxxxx.
23. Performance by Lessor. If the Lessee fails to promptly perform any of its
obligations under this Master Lease, Lessor may, at its option, perform such act
or make such payment which the Lessor deems necessary. All sums paid or incurred
by Lessor including reasonable attorneys' fees shall be immediately due and
payable by Xxxxxx, upon demand, and shall bear interest at 2% (two percent)
above the contract rate charged under Darling International Inc's Senior Credit
Facility with First Chicago NBD and other lenders dated June 5, 1997.
24. Entire Agreement. This Master Xxxxx and subsequent Schedules and exhibits
constitute the entire agreement of the parties. Neither party relies on any
other statements, understandings, representations or assurances, the same, if
any having been merged into this agreement. This agreement cannot be modified
except by a writing signed by each party. This agreement inures to the benefit
of the successors and assigns of the parties.
25. Waiver. No delay on the part of Lessor in the exercise of any right or
remedy shall operate as a waiver. No single or partial exercise by Lessor of any
right or remedy shall preclude any other future exercise of it or the exercise
of any other right or remedy. No waiver by Lessor of any default shall be
effective unless in writing and signed by Xxxxxx, nor shall a waiver on one
occasion be construed as a bar to or waiver of that right on any future
occasion.
26. Financial Reports. Upon request by Xxxxxx, Lessee will promptly furnish to
Lessor all financial reports required under the terms of the most recent Credit
Agreement between First Chicago NBD and Darling International Inc.
27. Waiver of Jury Trial. Xxxxxx and Xxxxxx, after consulting or having had the
opportunity to consult with counsel, knowingly, voluntarily and intentionally
waive any right either of them may have to a trial by jury in any litigation
based upon or arising out of this Master Lease, or any related agreement, or any
course of conduct, dealing or statements (whether oral or written). These
provisions shall not be deemed to have been modified in any respect or
relinquished by either Lessor or Lessee except by a written instrument executed
by both of them.
THIS MASTER LEASE AGREEMENT THE UNDERSIGNED (AND IF MORE THAN
SHALL NOT BE BINDING ON LESSOR ONE, JOINTLY AND SEVERALLY) AGREE
UNTIL IT HAS BEEN ACCEPTED AND TO ALL TERMS AND CONDITIONS ABOVE
EXECUTED BY AN OFFICER OF LESSOR. WHICH ARE PART OF THIS MASTER
LEASE AGREEMENT.
Accepted by Lessor: NBD BANK Lessee: DARLING INTERNATIONAL INC.
By: ____________________________ By: _________________________
Title: ____________________________ Title: _________________________
Date: _____________________ By: _________________________
Title: _________________________
Date: _______________________
Address For Notices: Address For Notices:
000 Xxxxxxxx Xxxxxx 000 X'Xxxxxx Xxxxx Xxxxxxxxx
Xxxxx #000 Xxxxx 000
Xxxxxxx, XX 00000 Xxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000 Fax No.: (000) 000-0000
SCHEDULE 1
This Schedule dated February 17, 1998
incorporates the Master Lease
dated February 17, 1998
between NBD BANK as Lessor,
and Darling International Inc. as Lessee.
Lessee: Darling International Inc. Lessor: NBD BANK
000 X'Xxxxxx Xxxxx Xxxx. 00000 Xxxxxxx Xxxx Xxxxx Xx.
Xxxxxx, Xxxxx 00000 Xxxxx 000
Xxxx, XX 00000
Tax I.D. No. YY
Location of Equipment: YY
Model/ Serial
Quantity Feature Description Number
-------- --------- ------------ --------
Rent Payment Due Date: The first day of each month in advance.
Initial Lease Term: The Lease Term for each leased item commences on the
Acceptance Date and continues for 84 months.
Rent: $QQ.
(If the First Rent Payment Due Date is after the Acceptance Date, the
first Rent payment shall be the total of (i) the first installment of
Rent as specified above, plus (ii) an amount equal to First Chicago
NBD's Prime Rate minus 1/2% (one-half percent), multiplied by the number
of days from and including the Acceptance Date for a leased item but
excluding the First Rent Payment Due Date.)
Rent is computed by multiplying the Equipment cost x YY. In the event the
Equipment cost varies from $YY, Rent will be adjusted accordingly.
At the end of 42 months, or at the end of 66 months, the Equipment may be
purchased for 58% or 29% of original equipment cost, respectively. If these
options are not exercised, the rent will continue to the end of the lease term.
Master Lease: This Schedule is issued pursuant to the Master Lease identified on
Page 1. All of the terms and conditions of the Master Lease are incorporated
herein and made a part hereof as if such terms and conditions were set forth in
this Schedule. By the execution and delivery of this Schedule, the parties
reaffirm all of the terms and conditions of the Master Lease except as modified.
NBD BANK DARLING INTERNATIONAL INC.
By: By:
----------------------- ------------------------
Name: Name:
----------------------- ------------------------
Title: Title:
----------------------- ------------------------
Date: Date:
----------------------- ------------------------
THIS SCHEDULE HAS 2 COUNTERPARTS. THIS IS COUNTERPART NO. .
---
A SECURITY INTEREST MAY BE CREATED ONLY IN COUNTERPART NO. 1.
SCHEDULE 1
CERTIFICATE OF ACCEPTANCE
This Schedule dated February 17, 1998
incorporates the Master Lease
dated February 17, 1998
between NBD BANK as Lessor,
and Darling International Inc. as Lessee
1. EQUIPMENT
Lessee certifies that the equipment described in this Schedule, has
been delivered to the location indicated below, inspected by Xxxxxx,
found to be in good order and are accepted on the Acceptance Date set
forth below:
Location of Equipment:
XX
YY
2. Acceptance Date: , 199 .
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DARLING INTERNATIONAL INC.
By:
Name:
Title:
Date:
THIS SCHEDULE HAS 2 COUNTERPARTS. THIS IS COUNTERPART NO. . A SECURITY INTEREST
MAY BE CREATED ONLY IN COUNTERPART NO. 1.
SCHEDULE 1
CASUALTY VALUE TABLE
This Schedule dated February 17, 1998
incorporates the Master Lease
dated February 17, 1998
between NBD BANK as Lessor,
and Darling International Inc. as Lessee
The Casualty Value of a leased item of Equipment is equal to the original cost
multiplied by the Casualty Value Percentage opposite the monthly rental period
in which the Event of Loss occurs.
Monthly Rental Casualty Value Monthly Rental Casualty Value Monthly Rental Casualty Value
Period Percentage Period Percentage Period Percentage
1 and Prior 109.07 31 76.53 61 37.89
2 108.14 32 75.33 62 36.51
3 107.18 33 74.13 63 35.13
4 106.20 34 72.91 64 33.74
5 105.21 35 71.69 65 32.34
6 104.22 36 70.47 66 30.94
7 103.21 37 69.24 67 29.54
8 102.20 38 68.00 68 28.13
9 101.17 39 66.76 69 26.72
10 100.14 40 65.51 70 25.31
11 99.09 41 64.26 71 23.88
12 98.04 42 63.00 72 22.46
13 96.98 43 61.73 73 21.03
14 95.91 44 60.46 74 19.60
15 94.83 45 59.18 75 18.16
16 93.74 46 57.89 76 16.72
17 92.64 47 56.60 77 15.27
18 91.54 48 55.30 78 13.81
19 90.43 49 54.00 79 12.35
20 89.31 50 52.69 80 10.89
21 88.18 51 51.37 81 9.43
22 87.05 52 50.05 82 7.95
23 85.91 53 48.72 83 6.48
24 84.76 54 47.38 84 5.00
25 83.61 55 46.04
26 82.44 56 44.69
27 81.28 57 43.34
28 80.10 58 41.99
29 78.92 59 40.63
30 77.73 60 39.26
SCHEDULE 1
PURCHASE OPTION RIDER
This Schedule dated February 17, 1998
incorporates the Master Lease dated
February 17, 1998 between NBD BANK as Lessor
and Darling International Inc. as Lessee
XXXXXX'S OPTIONS UPON EXPIRATION OF THE LEASE TERM:
In lieu of surrendering the Equipment described herein upon expiration
of the Lease, provided the Lease has not been earlier terminated and Lessee is
not in default, Lessee may elect, by written notice delivered to Lessor not less
than ninety (90) days prior to expiration of the Lease Term, to purchase all,
but not less than all, of the Equipment then subject to the Lease (Check
applicable option):
[ X ] A. At a purchase price equal to the Fair Market
Value (as defined below) of said Equipment upon
expiration of the Lease Term.
[ ] B. At a purchase price equal to the then Fair Market Value
(as defined below) which purchase price shall not be less
than % of the original equipment cost
nor more than % of the original equipment cost.
---------
[ ] C. At a purchase price of $ .
----------------
[ ] D. At a purchase price equal to % of the cost of the Equipment.
----
The Fair Market Value of the Equipment shall be determined on the basis
of, and shall be equal in amount to the value which would obtain, assuming the
Equipment had not been installed and was in good repair, condition and working
order, ordinary wear and tear resulting from proper use excepted, in an arm's
length transaction between an informed and willing buyer under no compulsion to
buy and an informed and willing seller under no compulsion to sell and, in such
determination, cost of removal from the location of current use shall not be a
deduction from such value. If Lessor and Lessee do not agree on the Fair Market
Value within ten (10) days after receipt by Lessor of notice that Lessee is
exercising its option to purchase the Equipment, such Fair Market Value shall be
determined by an independent source considered reliable and knowledgeable as to
values for such Equipment by Lessor in its reasonable judgment. The expenses and
fees shall be borne by Xxxxxx.
If Lessee elects to purchase the Equipment, the purchase price shall be
payable on or within 10 days of the expiration of the Initial Lease Term. Upon
payment of the purchase price, Lessor shall, upon request of Lessee, execute and
deliver to Lessee, or to Xxxxxx's assignee or nominee, a Bill of Sale without
representations or warranties, express or implied, except that such Equipment is
free and clear of all claims, liens, security interests and other encumbrances
by or in favor of a person claiming by, through or under Lessor for such
Equipment, other than liens and claims which Lessee assumed or is obligated to
discharge under the terms of the Lease. Lessee agrees to pay or cause to be paid
all sales and/or use taxes payable in connection with such sales, and any unpaid
property taxes theretofore assessed or levied against said Equipment. Purchase
of the Equipment is on an AS IS, WHERE IS, WITH ALL FAULTS BASIS.
Accepted this day of , 19 .
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NBD BANK DARLING INTERNATIONAL INC.
By: By:
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Its: Its:
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SCHEDULE 1
PURCHASE AGREEMENT ASSIGNMENT RIDER
This Schedule dated February 17, 1998
incorporates the Master Lease dated February 17, 1998
between NBD BANK as Lessor
and Darling International Inc. as Lessee
Darling International Inc. (the "Assignor") has entered into Purchase
Orders ("Purchase Agreement(s)") for the items of equipment described in this
Schedule or Exhibit A (the "Equipment"), the Assignor has agreed to sell its
right, title and interest in and to the Equipment to the Lessor and the Lessor
shall purchase the Equipment and lease the same to the Assignor, pursuant to the
Master Lease.
NOW, THEREFORE, in consideration of the mutual promises below, and the
execution and delivery of the Master Lease and this Schedule, the parties agree
as follows:
1. The Assignor sells, assigns, transfers and sets over to the Lessor,
its successors and assigns, all of its right, title and interest in and to the
Equipment and in and to the Purchase Agreement(s), including, without
limitation, (a) the right to purchase the Equipment pursuant to the Purchase
Agreement(s), the right to take title to the Equipment or any portion thereof,
and the right, but not the obligation, to be named the purchaser in each bill of
sale to be delivered by the Supplier(s) for the Equipment or any portion
thereof, (b) the right to assert all claims for damages arising as a result of
any default by the Supplier(s) under the Purchase Agreement(s), including
without limitation all warranty and indemnity provisions contained in the
Purchase Agreement(s), and (c) any and all rights of the Assignor to compel
performance of the terms of the Purchase Agreement(s).
2. It is agreed that, notwithstanding this assignment: (a) the Assignor
shall at all times remain liable to the Supplier(s) under the Purchase
Agreement(s) to perform all of the duties and obligations of the buyer to the
same extent as if this assignment had not been executed; (b) the exercise by the
Lessor of any of the rights assigned shall not release the Assignor from any of
its duties or obligations to the Supplier(s) under the Purchase Agreement(s)
except to the extent that such exercise by the Lessor shall constitute
performance of such duties and obligations; and (c) the Lessor shall not have
any obligation or liability to perform any of the obligations or duties of the
Assignor under the Purchase Agreement(s), to make any payment (other than to pay
the purchase price for the Equipment to the extent and upon the terms and
conditions set forth in the Master Lease), to make any inquiry as to the
sufficiency of any payment, to present or file any claim, or to take any other
action to collect or enforce any claim for any payment assigned.
3. The Assignor represents and warrants that the Purchase Agreement(s)
is (are) in full force and effect and is (are) enforceable in accordance with
its (their) terms; that the Assignor is not in default thereunder, and that the
Assignor has not assigned or pledged, and covenants that it will not assign or
pledge, so long as this assignment shall remain in effect, the whole or any part
of the rights thereunder assigned to anyone other than the Lessor. The Assignor
shall not amend, modify, terminate or waive, nor consent to any amendment,
modification, termination or waiver of any of the provisions of the Purchase
Agreement(s) without the written consent of the Lessor.
4. The Assignor agrees to indemnify and hold the Lessor, and its
assigns, directors, officers and agents, harmless from and against any and all
losses, claims, liabilities and expenses (including reasonable legal expenses
and court costs) (collectively "losses") which arise out of or relate to this
Assignment, the Purchase Agreement(s) or the manufacture, purchase, acceptance,
rejection, ownership and delivery and sale of the Equipment (including claims
for patent, trademark, or copyright infringement) except to the extent such
losses are caused by Xxxxxx's gross negligence or willful misconduct.
5. In the event that Lessor, at the request of Assignor, makes payment
to the Supplier(s) under said purchase order(s) prior to the Acceptance Date of
this Schedule, Assignor shall pay on the first day of each month prior to the
Acceptance Date rent to Lessor at the rate of interest equal to the rate charged
under Darling International Inc's Senior Credit Facility with First Chicago NBD
and other lenders dated June 5, 1997 from the date of each prepayment until the
Acceptance Date. In the event that a Certificate of Acceptance has not been
executed and delivered by the Assignor with respect to any item of Equipment on
or before N/A , unless the Lessor has otherwise agreed in writing: (a) this
Assignment shall terminate, provided, however, that the Assignor's obligation to
indemnify and hold the Lessor harmless shall survive any such termination, and
(b) the Assignor shall reimburse the Lessor for any and all payments made by the
Lessor to the Supplier(s) on account of such item of Equipment, together with
interest at the above rate from the date of each such payment.
SCHEDULE VV
PURCHASE AGREEMENT ASSIGNMENT RIDER
This Schedule dated February 17, 1998 incorporates the Master Lease dated
February 17, 1998 between NBD BANK as Lessor, and Darling International
Inc. as Lessee
LESSOR ASSIGNOR
NBD BANK DARLING INTERNATIONAL INC.
By: By:
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Its: Its:
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Date: Date:
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