EXHIBIT 10.17
TO THE EXTENT THAT THIS LEASE AND ANY LEASE SCHEDULE CONSTITUTES CHATTEL
PAPER (AS DEFINED IN THE UNIFORM COMMERCIAL CODE, AS IN EFFECT IN ANY APPLICABLE
JURISDICTION), NO SECURITY INTEREST HEREIN OR THEREIN MAY BE CREATED EXCEPT
THROUGH THE TRANSFER AND POSSESSION OF THE ORIGINAL EXECUTED COUNTERPART OF SUCH
LEASE SCHEDULE, WHICH SHALL BE IDENTIFIED AS THE ORIGINAL EXECUTED COUNTERPART
NO. 1 BY THE LESSOR ON THE SIGNATURE PAGE THEREOF. NO SECURITY INTEREST CAN BE
CREATED IN THIS LEASE BY TRANSFER OR POSSESSION OF THIS LEASE ALONE WITHOUT AN
ACCOMPANYING ORIGINAL COUNTERPART OF A LEASE SCHEDULE. NO TRANSFER, SALE,
MORTGAGE OR OTHER DISPOSITION OF ANY INTEREST IN THIS LEASE CAN BE EFFECTED BY
DISPOSITION OF THIS INSTRUMENT ALONE.
MASTER EQUIPMENT LEASE AGREEMENT
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MASTER EQUIPMENT LEASE AGREEMENT dated as of June 28, 1996 (this
"Lease"), by and between VENTURE LENDING & LEASING, INC., a Maryland corporation
("Lessor"), and NeoMagic Corporation, a California corporation ("Lessee").
Lessee desires to obtain from Lessor purchase money financing for
certain items of equipment used in Lessee's business, which equipment is
described more particularly under the caption "Description of Equipment" in one
or more Lease Schedules (as defined below) to this Lease (such equipment
together with all substitutions, renewals or replacements of, and all additions,
improvements and accessions to, any and all thereof, being hereinafter
collectively and separately referred to as the "Equipment").
Lessor is willing to provide financing for the Equipment to Lessee,
all on the terms and conditions hereinafter set forth, and on such additional
terms as are set forth in Lessor's commitment letter to Lessee dated March 13,
1996 (the "Commitment").
Accordingly, in consideration of the mutual covenants and agreements
hereinafter set forth, the parties hereto hereby agree as follows:
1. Lease. This Lease establishes the general terms and conditions by
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which Lessor may provide financing to Lessee with respect to the Equipment
listed on each lease schedule (sometimes, a "Lease Schedule" or "Schedule")
executed periodically pursuant to this Lease. Each Schedule shall be in the form
provided by Lessor, shall incorporate by reference the terms of this Lease, and
shall be and constitute a separate agreement as to the Equipment listed thereon
for all purposes, including default. If any provision of a Lease Schedule
conflicts with or supplements the provisions of this Lease, the provisions of
such Schedule shall be controlling. Pursuant to the Commitment, Lessor has
agreed to arrange for the furnishing and lease to Lessee, and Xxxxxx has agreed
to accept and lease Equipment having an aggregate Equipment Cost (as defined in
each Schedule) of not in excess of Two Million Dollars ($2,000,000.00).
Notwithstanding anything in the Lease to the contrary, it is understood and
agreed that Xxxxxx is purchasing the Equipment and Lessor is financing such
purchases. Accordingly, title to the Equipment shall be vested in Lessee upon
its acceptance thereof. To secure its obligations hereunder to Lessor, Lessee
hereby grants to Lessor a security interest in: (i) all Equipment, whether now
owned or hereafter acquired by Lessee; (ii) all leases and other agreements
covering the Equipment and any and all subleases of such Equipment (whether or
not permitted under this Lease); (iii) all software, source code, source code
escrow arrangements, object code, user manuals and other technical
documentation, and licenses purchased as part of or for use with the Equipment;
and (iv) all additions and accessions to, substitutions for and proceeds
(whether cash or non-cash) and products of any of the foregoing, including,
without limitation, all payments under insurance. Upon payment in full of all
rentals for such Equipment in accordance with the applicable Schedule and the
other terms of this Lease, the provisions of Sections 6 through 10 of this Lease
shall no longer apply to such items of Equipment and such security interest
shall be released.
2. Term. The term of this Lease as to each item of Equipment leased
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hereunder, shall commence on the date of acceptance of such item and shall end
at the expiration of the term therefor specified under "Term" in the applicable
Schedule.
3. Rent. Lessee shall pay to Lessor as rent for each item of
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Equipment during the applicable Term, on each Rent Payment Date (as defined in
the Schedule), the amount specified under "Lease Rental Payments" in the
Schedule (hereinafter referred to as "Rent"). If any amount due hereunder is not
paid, within five days of its due date, Lessee shall pay to Lessor, on demand, a
reasonable late charge in the amount of 5% of such overdue amount and interest
on such overdue amount at the rate of 2% per month (the "Late Payment Rate");
such late charge and interest shall apply only if permitted by applicable law,
and if not so permitted, such late charge and interest shall be calculated at
the maximum rates permitted by applicable law. All payments of Rent and other
amounts payable by Lessee to Lessor hereunder shall be made at the office of
Lessor specified under "Xxxxxx's Address" in the Schedule, or to such other
person, firm or corporation or Assignee (as defined in Section 20, "Assignment
by Lessor") and at such other place as Lessor or Assignee, as the case may be,
may from time to time designate in writing to Lessee.
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Notwithstanding any provisions hereof to the contrary, and payment, including
Rent, required under this Lease which is due on a day which is not a business
day shall be made on the business day next preceding the day on which such
payment is due. This Lease is non-cancellable and irrevocable for the entire
term set forth in the Schedule. Xxxxxx's obligation to pay all rentals and other
amounts payable hereunder are absolute and unconditional and shall not be
subject to any abatement, reduction, setoff, defense, counterclaim or recoupment
for any reason whatsoever, including but not limited to Lessee's right to
possession of the Equipment being terminated or Lessor retaking possession of
the Equipment because of a default by Lessee hereunder.
4. Lessee's Selection, Inspection and Acceptance. Lessee has
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selected or will select all items of Equipment to be leased hereunder from the
manufacturer or vendor thereof on the basis of its own judgment, and is not
relying on any statements, representations or warranties made by Lessor or its
representatives. Upon delivery, Lessee, at its own expense, shall make all
necessary inspections and tests of the Equipment in order to determine whether
the Equipment conforms to specifications and is in good condition and repair.
If the Equipment is in good condition and repair, Lessee shall execute and
deliver to Lessor a Certificate of Acceptance, in substantially the form thereof
attached hereto. Lessee warrants that each item of the Equipment is leased
solely for commercial or business use.
5. DISCLAIMER OF WARRANTIES BY XXXXXX. LESSOR DOES NOT MAKE, HAS
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NOT MADE, AND SHALL NOT BE DEEMED TO MAKE OR HAVE MADE, ANY REPRESENTATION OR
WARRANTY, EITHER EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING,
WITHOUT LIMITATION, THE DESIGN OR CONDITION OF THE EQUIPMENT, ITS
MERCHANTABILITY, DURABILITY, SUITABILITY OR ITS FITNESS FOR ANY PARTICULAR
PURPOSE, THE QUALITY OF THE MATERIAL OR WORKMANSHIP OF THE EQUIPMENT, OR THE
CONFORMITY OF THE EQUIPMENT TO THE PROVISIONS AND SPECIFICATIONS OF ANY PURCHASE
ORDER OR ORDERS RELATING THERETO OR TITLE TO THE EQUIPMENT OR ANY COMPONENT
THEREOF, AND LESSOR HEREBY DISCLAIMS ANY SUCH REPRESENTATION OR WARRANTY (WHICH
DISCLAIMER LESSEE HEREBY ACKNOWLEDGES). WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, LESSOR SHALL NOT BE LIABLE OR RESPONSIBLE FOR ANY DEFECTS, EITHER
PATENT OR LATENT (WHETHER OR NOT DISCOVERABLE BY LESSEE OR LESSOR), IN ANY UNIT
OF THE EQUIPMENT, OR FOR ANY DIRECT OR INDIRECT DAMAGE TO PERSONS OR PROPERTY
RESULTING THEREFROM, OR FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING
STRICT OR ABSOLUTE LIABILITY IN TORT), it being agreed that all such risks, as
between Lessor and Lessee, are to be borne solely by Lessee. Lessee acknowledges
that Lessor is not a dealer in or manufacturer of equipment of any kind, and
that each item of Equipment subject to this Lease is of a type, size, design and
capacity selected solely by Lessee. If the Equipment is not properly
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installed, does not operate as represented or warranted by the manufacturer or
seller thereof, or is unsatisfactory for any reason, Lessee shall make any claim
on account thereof solely against the manufacturer or seller, and, once the
Equipment is accepted by Xxxxxx, no such occurrence shall relieve Lessee of any
of its obligations hereunder. Lessor hereby assigns to Lessee any interest
Lessor may have in any manufacturer's or seller's warranty, whether express or
implied, on such item. All claims or actions on any warranty shall be made or
prosecuted by Xxxxxx, at its sole expense, and lessor shall have no obligation
whatsoever to make any claim on such warranty. At Lessor's option, all cash
proceeds or equivalent thereof from such warranty recovery shall be used to
repair or replace the Equipment.
6. Equipment to be and Remain Personal Property. Lessee shall take
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all such actions as may be required to assure that the Equipment shall be, and
at all times shall remain, personal property, notwithstanding the manner in
which the Equipment may be attached or affixed to real property. Lessee shall
give Lessor prompt notice of any circumstances which may permit any reason to
acquire, and shall obtain and record such instruments and take such steps as may
be reasonably requested by Lessor to prevent any such person from acquiring,
any rights in the Equipment by reason of the Equipment being claimed or deemed
to be real property. If requested by Xxxxxx, Xxxxxx shall obtain and deliver to
Lessor valid and effective waivers, in recordable form, by the owners,
landlords and mortgagees of any real property upon which the Equipment is
located, or certificates of Lessee that it is the owner of such real property
and that such real property is not leased and/or mortgaged. Lessee will at all
times protect and defend, at its own cost, Xxxxxx's security interests in the
Equipment from and against all claims, liens and legal process of creditors of
Lessee.
7. Location and Right of Inspection. The Equipment at all times
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shall be located at the address of Lessee specified under "Location of
Equipment" in the Schedule or such other place as shall be agreed upon in
writing between Lessor and Lessee. Lessor shall at all reasonable times during
customary business hours (but with the minimum practicable interference to
Lessees business operations) have the right to enter into and upon the premises
where the Equipment may be located for the purpose of inspecting the Lessee's
business premises and properties, including its use of the Equipment. Lessee
shall not move the Equipment from its agreed location except with the prior
written consent of Lessor which consent shall not unreasonably be withheld.
Lessee shall promptly advise Lessor of any circumstances with respect to
location which may adversely affect the Equipment or Lessor's security interest
therein.
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8. Markings and Filings. Lessee shall affix to the Equipment such labels,
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plates or decals as may be provided by Lessor, or conspicuously mark the
Equipment with such language as Lessor may reasonably request, to reflect the
interest of Lessor therein and, if there is an Assignee of Lessor, that such
Assignee has such interest in the Equipment specified by Lessor. Lessor is
hereby authorized at Xxxxxx's expense to cause this Lease or any financing or
other statement in respect thereto, showing the interest of Lessor and any
Assignee in and to this Lease and the Equipment, to be filed or recorded with
any governmental office deemed appropriate by Lessor. Lessee shall execute any
such financing statements presented to it by Lessor or any Assignee, and shall
be responsible for the payment of any fees for filing or recording such
statements, which filing or recording shall be the sole responsibility of
Lessor.
9. Alterations. Lessee shall not make any alterations, additions or
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improvements to the Equipment without the prior written consent of Lessor which
consent shall not unreasonably be withheld. Except as may be otherwise agreed
between Lessor and Lessee, all such alterations, additions and improvements
shall be considered accessions to the Equipment.
10. Use, Maintenance and Repair. Lessee shall use the Equipment solely in
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the conduct of its business and shall comply with all laws, ordinances or
regulations, and all conditions contained in any insurance policies or
manufacturers' warranties, relating to the Equipment or its use, operation or
maintenance. Lessee shall put the Equipment only to the use contemplated by the
manufacturers thereof. Lessee shall at Lessee's own expense maintain the
Equipment in good operating condition, repair and appearance, furnish all parts
and labor required to keep the Equipment in such condition, and protect same
from deterioration other than normal wear and tear. Lessee shall cause the
Equipment to be maintained in accordance with the supplier's standard preventive
maintenance contract, if available.
11. Insurance. Lessee will maintain at all times, at its own expense, with
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insurers of recognized standing, (i) insurance against "all physical loss"
perils subject to standard exclusions in an amount not less than the greater of
the full replacement value or the Stipulated Loss Value of such item of
Equipment as set forth on any Schedule B attached to the Lease Schedule, and
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(ii) public liability and property damage insurance policies insuring against
third party personal and property damage in respect of the use and operation of
the Equipment in an amount not less than $1,000,000 for each occurrence. Each
policy shall: (i) name Xxxxxx and Assignee, if any, as an additional insured and
loss payee, as their interests may appear to the extent of outstanding amounts
owed under the lease
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obligation. Any excess should be remitted to NeoMagic; (ii) contain an agreement
by the insurer that any loss thereunder shall be payable to Lessor and Assignee
notwithstanding any breach of representation or warranty by Lessee; (iii)
provide that there shall be no recourse against Lessor or Assignee for payment
of premiums or other amounts with respect thereto; and (iv) provide that at
least thirty (30) days' prior written notice of cancellation, change or lapse
shall be given to Lessor and Assignee by the insurer. All insurance for loss or
damage shall provide that losses, if any, shall be adjusted only with and
payable to Lessor or its Assignee, if any to the extent of outstanding amounts
owed under the lease obligation. Any excess should be remitted to NeoMagic.
Lessee shall pay all premiums for such insurance and shall deliver to Lessor
evidence of such payment and of the maintenance of the insurance coverages
required hereunder.
12. All Risk of Loss. All risk of loss, damage, theft or destruction
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(a "Loss") to the Equipment shall be borne entirely by Lessee, whether or not
the Loss is insured. Except as expressly provided in this Section, no Loss of
any kind shall relieve or release Lessee of its Rent and other obligations under
this Lease, all of which shall continue in full force and effect. In the event
of a Loss to any Equipment, Lessee shall promptly notify Lessor in writing of
such fact and of all details with respect thereto, and shall promptly, at
Lessee's option (or if an Event of Default has occurred and is continuing, at
the option of Lessor):
(a) repair and restore the item of Equipment to good mechanical
condition and working order;
(b) replace the Equipment with other equipment of the same type,
capacity and condition, and free and clear of claims or encumbrances in
favor of any third party other than Lessor, whereupon such replacement
equipment shall be subject to this Lease and be deemed Equipment for
purposes hereof; or
(c) pay to Lessor, on the Rent Payment Date next succeeding the
date on which the Loss occurred, an amount equal to the sum of (A) all
accrued and unpaid Rent payable for such Equipment through and including
such Rent Payment Date, and (B) the Stipulated Loss Value of the Equipment
as of such Rent Payment Date as set forth on any Schedule B attached to the
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Lease Schedule pertaining to such Equipment.
13. Licensing, Registration and Taxes. Lessee shall, at its sole cost
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and expense, (i) obtain any licensing and registration of the Equipment as may
be required by law, (ii) pay and discharge when due all license and registration
fees, assessments, taxes (excluding any tax measured by
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Lessor's net income), including, without limitation, sales, use, excise,
personal property, ad valorem, stamp, documentary and other taxes, and all
other governmental charges, fees, fines or penalties whatsoever, whether payable
by or assessed to Lessor or Lessee, on or relating to the Equipment or the use,
xxxxxxxxxxxx, xxxxxx, shipment, transportation, delivery, ownership, operation
or disposition thereof, and on or relating to this Lease, (iii) file all returns
required therefor and furnish copies thereof to Lessor at its request, and (iv)
indemnify and hold Lessor harmless from any of the foregoing.
14. Liens. Lessee will not directly or indirectly, voluntarily or by
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operation of law, create, incur, assume or permit to exist any claim, mortgage,
security interest, pledge, lien, charge or other encumbrance ("Liens") against
the Equipment, except the following: (i) the rights of Lessee, Lessor and any
Assignee under this Lease; (ii) Liens against Lessor's interests in the
Equipment created or granted by Lessor or resulting from claims against Lessor
not related to the transactions contemplated hereby; (iii) Liens for taxes,
assessments or governmental charges or levies, not due and delinquent; (iv)
undetermined or inchoate materialmen's, mechanics', workmen's, repairmen's or
other like Liens arising in the ordinary course of business which in each case,
either are not delinquent or have been bonded ("Permitted Liens"). Lessee, at
its own cost and expense, will promptly pay, satisfy, discharge and otherwise
take such action as may be necessary to keep the Equipment free and clear of,
and duly to discharge, any Lien other than Permitted Liens.
15. Indemnification. Lessee assumes liability for, will pay when due
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and will indemnify, protect, save, defend and hold Lessor, its agents,
employees, successors and assigns harmless from and against, any and all
obligations, liabilities, losses, damages, injuries, fines, penalties, interest,
claims, demands, actions, suits, costs and expenses, including reasonable
attorneys' fees and expenses, of every kind and nature whatsoever imposed on,
incurred by or asserted against, Lessor, its agents, employees, successors and
assigns in any way relating to or arising out of (a) the manufacture, ordering,
purchase, acceptance or rejection, ownership, delivery, leasing, possession,
use, operation or disposition of the Equipment, including, without limitation,
any of such as may arise from patent or latent defects in the Equipment (whether
or not discoverable by Lessee or Lessor), any claims based on strict liability
in tort, and any claims based on patent, trademark or copyright infringement,
except to the extent any of the foregoing arises out of gross negligence
or willful misconduct of Lessor or (b) any failure on the part of Lessee to
perform or comply with any of the terms of this Lease required to be performed
or complied with by Lessee. Lessee shall give
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written notice to Lessor of any occurrence, event or condition known to Lessee
as a consequence of which Lessor may be entitled to indemnification hereunder.
If any action, suit or proceeding is brought against any indemnified party in
connection with any claim indemnified against under this Section, Lessee may,
and upon the reasonable request of such indemnified party shall, at Xxxxxx's
expense, resist and defend such action, suit or proceeding, or cause the same to
be resisted or defended, by counsel selected by Xxxxxx and reasonably approved
by such indemnified party, and Lessee shall pay all costs and expenses
(including without limitation attorneys' fees and expenses) incurred by such
indemnified party in connection with such action, suit or proceeding. If a claim
is made against any indemnified party with respect to which such indemnified
party is entitled to indemnification from Lessee under this Section, Lessor
shall reasonably promptly notify Lessee thereof. Lessee shall forthwith upon
demand of Lessor reimburse Lessor and any other indemnified party for amounts
expended by Lessor or such other indemnified party in connection with any of the
foregoing or pay such amounts directly. The provisions of this Section shall
apply from the date of the execution of this Lease and shall survive the
expiration or earlier termination of this Lease.
16. Events of Default. The occurrence of any one or more of the
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following events shall constitute an "Event of Default" hereunder (whether any
such event shall be voluntary or involuntary or come about or be effected by
operation of law or pursuant to or in compliance with any judgment, decree or
order of any court or any order, rule or regulation of any administrative or
governmental body):
(a) Default by Lessee in payment of any installment of Rent or
other monetary obligation now or hereafter owed by Lessee to Lessor under
this Lease or under any other lease of equipment now or hereafter existing
between Lessee and Lessor or any affiliate of Lessor, and the continuance
of such default for 5 consecutive days (for purposes of this subparagraph
(a) "affiliate of Lessor" shall mean any person or entity which controls or
is controlled by or under common control with Lessor);
(b) Default by Lessee in the performance of any of the covenants
of Lessee set forth in Sections 7 ("Location and Right of Inspection"), 11
("Insurance"), 18 ("Return of Equipment") and 19 ("Assignment by Lessee")
hereof;
(c) Default by Lessee in the payment or performance of any
obligation with respect to any indebtedness for any borrowing or the
deferred purchase of property or any lease of property, in excess of 10%
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of Lessee's net worth or a default by Lessee under any agreement, license
or other document relating to software used in connection with the
Equipment, the effect of which would permit any licensor or third party to
terminate either Xxxxxx's or Lessor's license or other rights with respect
to such software;
(d) Any representation or warranty made by Lessee in this Lease
or in any other document or certificate furnished to Lessor in connection
herewith or pursuant hereto, shall prove to be untrue or incorrect in any
material respect as of the date of issuance or making thereof;
(e) Xxxxxx becomes insolvent or bankrupt or admits in writing
its inability or fails to pay its debts as they mature, or makes an
assignment for the benefit of creditors, or applies for or consents to the
appointment of a trustee or receiver for any of its properties or assets;
(f) Any proceedings shall be authorized by corporate action
taken by Xxxxxx's shareholders or directors, or shall be commenced by or
against Lessee, for any relief under any bankruptcy or insolvency laws, or
laws relating to the relief of debtors, readjustments of indebtedness,
reorganizations, arrangements, compositions or extensions, unless, in the
case of involuntary proceedings only, such proceedings shall have been
dismissed within 60 days after such proceedings shall have been commenced;
(g) Default by Lessee under any warrant to purchase capital
stock of Lessee issued to Lessor in connection with the execution of this
Agreement (a "Warrant"), or material breach of any undertaking, covenant or
material representation or warranty made by Lessee for the benefit of
Lessor in any document, instrument or agreement relating to the Warrant or
made in connection therewith, including any registration rights or
anti-dilution provisions; or
(h) Default by Lessee in the performance or observance of any
other obligation, covenant or liability of Lessee contained in this Lease
and the continuance of such default for 30 consecutive days after written
notice thereof by Lessor to Lessee.
17. Remedies of Lessor. Upon the occurrence of any Event of Default
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and at any time thereafter while such Event of Default is continuing, Lessor (i)
shall have no further obligations under the Commitment, and (ii) may, without
any further notice, exercise one or more of the
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following remedies as Lessor in its sole discretion shall elect:
(a) Declare all unpaid Rent and other sums due or to become due
under this Lease to be immediately due and payable;
(b) Terminate this Lease, whereupon all rights of Lessee to the
use of the Equipment shall absolutely cease and terminate but Lessee shall
remain liable as herein provided, and thereupon Lessee will permit Lessor
to store the Equipment on Lessee's premises or wherever the Equipment may
then be located, without charge, until sold or otherwise disposed of and,
if so requested by Lessor, shall at the expense of Lessee, promptly deliver
possession of the Equipment to Lessor at such place as Lessor shall
designate in the manner provided in Section 18 hereof;
(c) Take possession of the Equipment wherever found, and for
this purpose enter upon any premises of Lessee and remove the Equipment all
without liability on the part of Lessor for or by reason of such entry or
taking of possession, whether for the restoration of damage to property
caused by such taking or otherwise. Taking possession of the Equipment
shall not be construed to be an election to terminate this Lease and this
Lease shall remain in effect and Lessee shall remain liable for all
payments to be made hereunder. Lessee consents to the granting of one or
more applications for a writ of possession on an ex parte basis by a court
of competent jurisdiction upon posting of such undertaking or bond as may
be required by law, and agrees that the amount of such undertaking may be
limited to the depreciated value of the Equipment determined by Lessor as
of the proposed date of repossession;
(d) Sell the Equipment at public or private sale, in such
commercially reasonable manner as Lessor may deem appropriate (giving
Lessee at least ten (10) days' prior written notice of the time and place
of any such public sale, or the time after which a private sale may be
made, which notice Lessee hereby agrees is reasonable), or otherwise
dispose of, hold, use, operate or keep idle the Equipment, all as Lessor,
in its sole discretion, may determine and all free and clear of any rights
of Lessee and without any duty to account to Lessee (except as hereinafter
provided) for such action or inaction or for any proceeds resulting
therefrom. Lessor shall apply the net proceeds (the proceeds of any sale
minus all costs and expenses incurred with the recovery, repair, storage,
sale) of any such sale to the payment of Lessee's obligations hereunder,
Lessee
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remaining liable for any deficiency (and any excess to be paid over to
Lessee), which at Xxxxxx's option, shall be paid monthly, as suffered, or
immediately in a lump sum, or at the end of the term, as damages for
Xxxxxx's default;
(e) By written notice to Lessee, cause Lessee to pay Lessor (as
liquidated damages for loss of a bargain and not as a penalty) on the date
specified in such notice, an amount equal to the sum of: (A) any unpaid
Rent that accrued on or before the occurrence of the Event of Default, and
(B) the Stipulated Loss Value of such Equipment, as of the date of
occurrence of the Event of Default, as set forth on any Schedule B attached
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to the Lease Schedule pertaining to such Equipment. Should Lessor, however,
estimate its actual damages to exceed the foregoing, Lessor may, at its
option, recover its actual damages in lieu of or in addition thereto. If
Lessor proceeds pursuant to this subsection (e), Lessor hereby appoints
Lessee its agent to dispose of the Equipment at the best price obtainable
on an "as-is", "where is" basis, without representation or warranty,
express or implied. If Lessee has previously paid the amount of liquidated
damages specified above to Lessor, Lessee shall be entitled to the proceeds
of such sale of the Equipment; or
(f) Avail itself of any other remedy provided by any statute or
otherwise available at law, in equity or in bankruptcy.
No remedy referred to in this Section is intended to be exclusive, but each
shall be cumulative and in addition to any other remedy referred to above or
otherwise available to Lessor at law, in equity or in bankruptcy, and the
exercise or beginning of exercise by Lessor of any one or more of such remedies
shall not preclude the simultaneous or later exercise by Lessor of any or all
such other remedies. No waiver by Lessor of any Event of Default hereunder shall
in any way be or be construed to be a waiver of any future or subsequent Event
of Default. Lessee shall be liable for all costs and expenses (including
reasonable attorneys' fees and disbursements and the costs of any retaking)
incurred by reason of the occurrence of any Event of Default and the exercise of
Xxxxxx's remedies with respect thereto.
18. Return of equipment After Default. Upon early termination of this
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Lease pursuant to Section 17 ("Remedies of Lessor"), Lessee shall return each
item of Equipment to Lessor in good condition, ordinary wear and tear resulting
from proper use thereof excepted, in the following manner: by forthwith
delivering possession of the Equipment to Lessor. Lessee will, at its sole cost
and risk, forthwith prepare, dismantle, crate and deliver the Equipment
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at the place designated by Lessor, arrange for storage of the Equipment until
the Equipment has been sold or otherwise disposed of by Lessor, and/or deliver
the same to any carrier for shipment (insurance and freight prepaid) to such
place within the continental United States as shall be designated by Lessor, all
as directed by Xxxxxx. The preparation, dismantling, crating, delivery, storage
and transporting of the Equipment shall be at the expense and risk of Lessee and
are of the essence of this Lease, and upon application to any court of equity
having jurisdiction Lessor shall be entitled to a decree against Lessee
requiring specific performance of the covenants of Lessee so to prepare,
dismantle, crate, deliver, store and transport the Equipment. During any storage
period, Lessee will, at its own expense and risk, maintain and keep the
Equipment fully insured and in good order and repair and will permit Lessor or
any person designated by it, including the authorized representative or
representatives of any prospective purchaser of any item of the Equipment, to
inspect the same. Lessee shall be responsible, at its sole cost and expense, for
any repairs necessary to place the Equipment in the condition hereinabove
required upon return, and for the discharge of all Liens (other than Permitted
Liens) thereon at the time of such return.
19. Assignment by Xxxxxx. Lessee shall not assign, pledge or
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hypothecate this Lease in whole or in part, or any interest therein, nor shall
Lessee sublease or otherwise relinquish possession of, any item of the Equipment
without the prior written consent of Lessor. Xxxxxx's interest herein may not be
assigned or transferred by operation of law. Consent to any of the foregoing
acts by Lessor shall not be deemed to be consent to any subsequent similar act
by Xxxxxx. Any assignment by Xxxxxx in violation of the provisions of this
Section shall be void.
20. Assignment by Lessor. Lessor may at any time, with or without
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notice to Lessee, transfer, sell, mortgage, grant a security interest in or
assign this Lease, any Lease Schedule (each such schedule constituting a
separate Lease as to the Equipment described therein), any Rent due or to become
due hereunder, or its security interests in the Equipment; and in such event
Lessor's transferee, purchaser, mortgagee, secured party or assignee (an
"Assignee") shall have all of Lessor's rights, powers, privileges and remedies
hereunder and shall not be obligated to perform any duty, covenant or condition
required to be observed or performed by Xxxxxx, subject only to the rights of
Lessee to possession and quiet enjoyment of the Equipment as long as no Event of
Default has occurred under this Lease. All amounts payable to Lessor under this
Lease shall be payable to Assignee at such address as Assignee may designate in
writing to Lessee. Xxxxxx acknowledges and agrees that the rights of any
Assignee in and to the sums payable by Xxxxxx under any
12
provision of this Lease shall not be subject to any abatement whatsoever and
shall not be subject to any defense, setoff, counterclaim or recoupment of any
nature whatsoever by reason of any liability or obligation, howsoever and
whenever arising, of Lessor to Lessee or to any other person, firm or
corporation or governmental authority, or for any other cause whatsoever.
21. Successors and Assigns. All of the covenants, conditions and
----------------------
obligations of each party contained in this Lease shall be binding upon, and,
subject to the provisions of Section 19, inure to the benefit of, the respective
successors and assigns of the parties hereto.
22. Lessor's Performance of Xxxxxx's Obligations. If Lessee shall
--------------------------------------------
fail to duly and promptly perform any of its obligations under this Lease
with respect to the Equipment, Lessor may (at its option) perform any act or
make any payment required of Lessee, and Lessee shall reimburse Lessor (payable
by Lessee on demand) for all sums so paid or incurred by Xxxxxx, together with
interest at the Late Payment Rate and any reasonable legal fees incurred by
Lessor in connection therewith. The performance of any act or payment by Lessor
as aforesaid shall not be deemed a waiver or release of any obligation or
default on the part of Lessee.
23. Managerial Assistance. During the Term and so long as any
---------------------
obligations under this Lease remain outstanding:
(a) Lessor shall make available to Lessee "significant
managerial assistance", as defined in Section 2(a)(47) of the Investment
Company Act of 1940, as amended, either in the form of: (i) consulting
arrangements with Lessor or any of its officers, directors, employees or
affiliates, (ii) Lessee's allowing Lessor to designate members of Lessee's
Board of Directors, or (iii) Lessor, at Lessee's request, seeking the
services of third-party consultants to aid Lessee with respect to its
management and operations; and
(b) Lessee may in its discretion, permit Lessor, as a "venture
capital operating company," to participate in, and influence the conduct of
management of Lessee through the exercise of "management rights", as those
terms are defined in Section 2510.3-101 of the U.S. Department of Labor's
regulations, Title 29 of the Code of Federal Regulations.
24. Financial and other Reports. During the Term and so long as any
---------------------------
obligations under this Lease remain outstanding, Lease shall:
13
(a) Furnish to Lessor and any Assignee of Lessor identified to
Lessee (i) within 90 days after the close of each fiscal year of Lessee, an
audited balance sheet and statement of changes in financial position of Lessee
at and as of the end of such fiscal year, together with an audited statement of
income of Lessee for such fiscal year; (ii) within 45 days after the close of
each calendar month (or, if the stock of Lessee is publicly traded, each fiscal
quarter) of each fiscal year of Lessee, an unaudited balance sheet of Xxxxxx at
and as of the end of such month (or quarter, as the case may be), together with
an unaudited statement of income of Lessee for such month or quarter, as the
case may be; and (iii) from time to time, such other information as Lessor or
Assignee may reasonably request regarding Xxxxxx's business, financial condition
and prospects; and
(b) Consider permitting Lessor, upon reasonable request, to
substantially participate in management of Lessee by consulting with and
advising officers of Xxxxxx regarding Lessee's equipment acquisition and
financing plans, and such other matters affecting the business, financial
condition and prospects of Lessee as Lessor shall reasonably deem relevant; and
(c) If Lessor reasonably believes that financial or other
developments affecting Lessee have impaired or are likely to impair Xxxxxx's
ability to perform its obligations under this Lease, permit Lessor reasonable
access to Lessee's management and/or Board of Directors and opportunity to
present Lessor's views with respect to such developments.
Lessee hereby warrants and represents that all financial statements delivered to
Lessor or such Assignee by or upon behalf of Xxxxxx, and any statements and data
submitted in writing to Lessor or such Assignee in connection with this Lease,
are true and correct and fairly present the financial condition of Lessee for
the periods involved, and are prepared in accordance with generally accepted
accounting principles consistently applied, and that there has occurred no
material adverse change in the financial condition of Lessee since the date of
the last financial statement delivered to Lessor which has not been disclosed in
writing to Lessor.
25. Power; Absence of Conflict. Lessee is a corporation duly
--------------------------
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation. The execution, delivery and performance of
this Lease, and the obligations of Lessee hereunder have been duly authorized by
all necessary corporate action, and constitute the valid and binding obligations
of Lessee
14
enforceable in accordance with their terms. The performance by Lessee of its
obligations hereunder will not result in a material breach or violation of, or
constitute a material default under, any statute, note, agreement, lease or
other instrument to which Lessee is a party or by which Lessee is bound,
Xxxxxx's Articles of Incorporation or Bylaws, or, to Xxxxxx's knowledge any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over Lessee.
26. Attorneys' Fees. If Lessor or Lessee institutes legal action
---------------
against the other to interpret or enforce this Lease or to obtain damages for
any alleged breach thereof, the prevailing party in such action shall be
entitled to an award of reasonable attorneys' fees and costs.
27. Notices. All notices required or permitted under this Lease shall
-------
be in writing and shall be deemed to have been duly given on the date of service
if served personally on the party to whom notice is to be given, or on the third
calendar day after deposit in the mail, if sent by first class mail, registered
or certified, postage prepaid, and properly addressed to Lessor or Lessee, as
the case may be, at their respective addresses set forth in the Schedule, or at
such other address as either party shall from time to time designate in the
manner provided above to the other party.
28. Governing Law. This Lease shall be governed by, and construed in
-------------
accordance with, the laws of the State of California, without regard to the
conflicts of laws provisions thereof. The parties acknowledge and agree that
this agreement and the transactions contemplated hereunder involve the provision
of equipment financing by Xxxxxx and the creation of security interests in such
equipment, and shall not be deemed a lease as defined in Division 10 of the
California Commercial Code.
29. Entire Agreement; Amendments; Waivers. This Lease, together with
-------------------------------------
any and all Schedules and exhibits attached hereto, constitutes the entire
agreement between Lessor and Lessee, and supersedes all prior oral or written
agreements or understandings, with respect to the subject matter hereof, and it
shall not be amended, altered or changed, except by written agreement signed by
the parties hereto. No waiver of any provision of this Lease and no consent to
any departure by Lessee therefrom shall be effective unless the same shall be in
writing and signed by both parties, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
30. Severability. If any term or provision of this Lease or the
------------
application thereof shall, to any extent,
15
be invalid or unenforceable, such invalidity or unenforceability shall not
affect or render invalid or unenforceable any other provision of this Lease, and
this Lease shall be valid and enforced to the fullest extent permitted by law.
31. Headings. The Section headings used herein are solely for
--------
convenience of reference and shall not be construed to define or limit any of
the terms or provisions hereof.
32. Further Assurances. Lessee shall execute and deliver to Lessor,
------------------
upon Lessor's request, such instruments and assurances as Lessor deems necessary
or desirable for the confirmation of Xxxxxx's rights hereunder. In furtherance
thereof, Xxxxxx agrees to take whatever action as may be necessary to enable
Lessor or any Assignee to file, register or record, and refile, re-register and
re-record, this Lease and any financing statements or other documents requested
by Lessor or any Assignee pursuant to the Uniform Commercial Code or otherwise.
Lessee authorizes Lessor to effect any such filing (including, where permitted
by applicable law, the filing of any financing statements without the signature
of Xxxxxx) and Xxxxxx's expenses with respect hereto shall be payable by Xxxxxx
on demand.
TO THE EXTENT THAT THIS LEASE AND ANY LEASE SCHEDULE CONSTITUTES CHATTEL
PAPER (AS DEFINED IN THE UNIFORM COMMERCIAL CODE, AS IN EFFECT IN ANY APPLICABLE
JURISDICTION), NO SECURITY INTEREST HEREIN OR THEREIN MAY BE CREATED EXCEPT
THROUGH THE TRANSFER AND POSSESSION OF THE ORIGINAL EXECUTED COUNTERPART OF SUCH
LEASE SCHEDULE, WHICH SHALL BE IDENTIFIED AS THE ORIGINAL EXECUTED COUNTERPART
NO. 1 BY THE LESSOR ON THE SIGNATURE PAGE THEREOF. NO SECURITY INTEREST CAN BE
CREATED IN THIS LEASE BY TRANSFER OR POSSESSION OF THIS LEASE ALONE WITHOUT AN
ACCOMPANYING ORIGINAL COUNTERPART OF A LEASE SCHEDULE. NO TRANSFER, SALE,
MORTGAGE OR OTHER DISPOSITION OF ANY INTEREST IN THIS LEASE CAN BE EFFECTED BY
DISPOSITION OF THIS INSTRUMENT ALONE.
16
IN WITNESS WHEREOF, the parties have duly executed this Lease as of the day
and year first above written.
LESSOR:
VENTURE LENDING & LEASING, INC.,
a Maryland corporation
By: Xxxxxxxx Xxxxxxxxx
----------------------------
Its: President
---------------------------
LESSEE:
NeoMagic Corporation
a California corporation
By: Xxxx Xxxxxxx
----------------------------
Its: VP & CFO
--------------------------
17
LEASE SCHEDULE NO. 48-001
TO
MASTER EQUIPMENT LEASE AGREEMENT
--------------------------------
TO THE EXTENT THAT THIS LEASE SCHEDULE CONSTITUTES CHATTEL PAPER (AS
DEFINED IN THE UNIFORM COMMERCIAL CODE, AS IN EFFECT IN ANY APPLICABLE
JURISDICTION), NO SECURITY INTEREST HEREIN MAY BE CREATED EXCEPT THROUGH THE
TRANSFER OR POSSESSION OF THE ORIGINAL EXECUTED "COUNTERPART NO. 1" OF THIS
LEASE SCHEDULE, WHICH SHALL BE IDENTIFIED ON THE SIGNATURE PAGE HEREOF.
This Lease Schedule is executed in accordance with the terms of the
Master Equipment Lease Agreement ("Master Lease") dated as of June 28, 1996 by
and between Venture Lending & Leasing, Inc., ("Lessor"), and NeoMagic
Corporation, a California corporation ("Lessee"). Unless otherwise expressly
defined herein, capitalized terms used herein shall have the same meaning as in
the Master Lease. All terms and conditions of the Master Lease are incorporated
herein by this reference.
I. Delivery and Acceptance Period:
------------------------------
Not later than June 30, 1996
II. Location(s) of Equipment:
------------------------
0000 Xxx Xxxxxx
Xxxxx Xxxxx, XX 00000
Mitsubishi Electric Corporation, Saijo Factory
8-6 Hiuchi Saijo-City Erime-Prefecture
793 Japan
III. Term:
----
With respect to each item of Equipment, a Term of 42 months,
commencing on the first day of the month next following the date
of acceptance of such item hereunder by Xxxxxx; with an interim
Term commencing on the date of acceptance of such item and
continuing to but not including the first day of the Term.
IV. Equipment Cost:
--------------
"Equipment Cost" shall mean the total purchase price, paid or
financed by Lessor in respect of each item of Equipment.
V. Rent Payment Dates:
------------------
July 1, 1996 two (2) Rental Payments, first and last in advance,
and the payment of Rent for any interim Term; Forty (40)
consecutive monthly Rent payments on the first day of each month
commencing on August 1, 1996 to and including November 1, 1999
and January 1, 2000.
VI. Lease Rental Payments:
---------------------
With respect to each item of Equipment, a monthly amount equal to
2.87% multiplied by the Equipment Cost of such item, in advance;
plus a final payment in an amount equal to 10% multiplied by the
Equipment Cost of such item, payable on the first day of the
month next following the last day of the Term. Rent for any
period less than a month shall be prorated daily on the basis of
a 30-day month.
VII. Lessee's Address:
----------------
0000 Xxx Xxxxxx
Xxxxx Xxxxx, XX 00000
VIII. Name and address of Lessor:
--------------------------
Venture Lending & Leasing, Inc.
0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000-0000
Address to which Rental and other payments are to be sent:
Bank of Boston
Payment Unit
P.O. Box 1323
Providence, RI 02901-1323
2
IX. Description of Equipment:
------------------------
Mfg. or I.D. or Unit Equipment
Quantity Vendor Description Serial Cost Cost
-----------------------------------------------------------------------
(EQUIPMENT FULLY DESCRIBED ON ATTACHED EQUIPMENT LIST)
3
NEOMAGIC CORPORATION
EQUIPMENT LIST FOR LEASE SCHEDULE NO. 48-001
MANUFACTURER QTY DESCRIPTION SERIAL INVOICE INVOICE EQUIPMENT
OR NUMBER NUMBER DATE COST
VENDOR
-----------------------------------------------------------------------------------------------------------------------------------
DNP AMERICA, INC. 1 PHOTOMASK 6" QZ EB PELLICLIZED 5X RETICLE 0.5 UM SPOT SIZE 85BQG 60339 2/29/96 39,300.00
1 PHOTEMASK 6" QZ EB PELLICLIZED 5X RETICLE 0.25 UM SPOT SIZE 62BTG
2 PHOTOMAST 6" QZ EB PELLICLIZED 5X RETICLE 0.125UM SPOT SIZE 56BOG
61BUG
DNP AMERICA, INC. 2 PHOTOMASK 7" QZ EB PELLICLIZED 1X MASTER 0.5U SPOT SIZE 57AG 60336 2/29/96 7,400.00
65AP
DNP AMERICA, INC. 2 PHOTOMASK 6" QZ EB PELLICLIZED 5X RETICLE 0.5U SPOT SIZE 77ATG 60334 2/29/96 130,300.00
99AUG
1 PHOTOMASK 6" QZ EB PELLICLIZED 5X RETICLE 0.25U SPOT SIZE 62ATG
2 PHOTOMASK 6" QZ EB PELLICLIZED 5X RETICLE 0.125U SPOT SIZE 91AUG
76AUG
53AUG
55AQG
56AUG
61AUG
2 PHOTOMASK 6" QZ EB PELLICLIZED pHASE SHIFT 5X0.125U 80AVG
SPOT SIZE 75AVG
INTELLIGRAPHICS 1 ACCELERATED NM2070 NT DRIVER 159 4/30/96 53,700.00
1 ACCELERATED NM2090 PM DRIVER
INTELLIGRAPHICS 1 2090 NT ACCELERATION BETA 153 4/25/96 15,000.00
INTELLIGRAPHICS, INC. 1 FINAL ACCEPTANCE OF ACCELERATED NM2070 NT DRIVER 171 5/23/96 60,000.00
1 FINAAL ACCEPTANCE OF ACCELERATED NM2090 PM DRIVER
INTELLIGRAPHICS, INC. 1 5.0 DUMB FRAM BUFFER 170 5/23/96 5,000.00
INTELLIGRAPHICS, INC. 1 2090 NT ACCELERATION 168 5/16/96 15,950.00
COMNET INTERNATIONAL TRANSLATION INTO 7 DIFFERENT LANGUAGES 11409 5/10/96 1,000.00
WCS 1 VPM DRIVER AND RELEASE 6125 5/1/96 6,000.00
SPECTRUM ASSOCIATES, INC. 1 POINT MAN SOFTWARE 25977A 5/21/96 165,976.00
PIVOT POINT, INC. 1 POINT MAN SOFTWARE TOOLS
SUN MICROSYSTEMS, INC. 1 ULTRA1/170 TX1, 20, C 64MB, 2GB SUN SPARC 611F12BA 11532838 3/20/96 30,647.53
1 US UNIX COUNTRY KIT
1 64MB BYTE MEMORY EXPANSION
1 120 MBBTE MEMORY EXPANSION
Page 1
NEOMAGIC CORPORATION
EQUIPMENT LIST FOR LEASE SCHEDULE NO. 48-001
MANUFACTURER QTY DESCRIPTION SERIAL INVOICE INVOICE EQUIPMENT
OR NUMBER NUMBER DATE COST
VENDOR
-----------------------------------------------------------------------------------------------------------------------------------
1 SBUS INTLGNT SCSI HOST ADP SGL 11774
1 8.4GB MULTIPACK 609G2344
1 INTERNAL TRPL DNSTY FLOPPY DISK DRIVE
1 SUNCO 4XINTERNAL DR FOR FUSION 9605702548
1 4.8GB 4MM DDS-2 SPARCSTORAGE 611G0856
1 SOLARIS 2.X DESKTOPO MEDIA KIT
1 SOLARIS 2.X FULL DOCUMENTS SET 1027-76392
1 SW ASSY, WORKSHP C2.0 1 USR
1 MF COBOL 3.2 COMPILER/TOOLBOX
1 MF COBOL 3.2 DIALOG SYSTEM
SUN MICROSYSTEMS, INC. 1 SPARCWORKS PRO 30.1 SLIM 421-77360 11539218 3/28/96 896.25
SUN MICROSYSTEMS, INC. 1 150MHZ TGX DESKTOP WORKSTATION 610F0105 D0813461 3/20/96 13,072.12
1 US UNIX COUNTRY KIT
1 32MB MEMORY EXPANSION
1 SOL 1.X SIDEGRADE - LIC & CD
SUN MICROSYSTEMS, INC. 1 MODULE UPGRADE TO S10 151 15321 11527962 3/11/96 2,918.75
1 US UNIX COUNTRY KIT
1 DT UPGRADE TO SOL 2 CURRENT
FLORE STORAGE 1 YAMAHA 2X CDR A736B-N 496 3/13/96 1,077.50
MOMENTUM MICORSYSTEM, INC. 1 US ROBOTICS "SPORTSTER: 28.8 INTERNAL FAXMODEM V.34 84100142071326 15580 3/6/96 903.48
1 MS VISUAL C++ V4.0 SUBSCRIPTION CD ROM
1 MS MASM V6.11 MACRO ASSEMBLY LANGUAGE DEVELOPMENT SYSTEM
MOMENTUM MICROSYSTEM, INC. 1 ACER PENTIUM 100 SYSTEM INCLUDES
MEDIUM TOWER D3156970 15603 3/7/96 3,387.58
TRITON 586 MOTHERBOARD, INTEL 100MHZ CPU & XXXXXXX FAN,
2 16MB RAM MEMORY
1.44MB FLOPPY DRIVE, QUANTUM 1.2GB IDE HARD DRIVE
INT. 4X CD-ROM IDE, 3C509COMBO ETHERLINK III, VGA PCI
TR1064
W2MB, ACER 101 TOUCH KEYBOARD, MS-II ERGONOMIC
MOUSE MS WINDOWS 95 INSTALLED
ACER 701 17" MULTISYNC MONITOR M71H60700408
MS OFFICE PRO W/BOOKSHELF WIN 95
W/DOCS CD ROM
Page 2
NEOMAGIC CORPORATION
EQUIPMENT LIST FOR LEASE SCHEDULE NO. 48-001
MANUFACTURER QTY DESCRIPTION SERIAL INVOICE INVOICE EQUIPMENT
OR NUMBER NUMBER DATE COST
VENDOR
---------------------------------------------------------------------------------------------------------------------
MOMENTUM MICROSYSTEM, INC. 1 ACER PENTIUM 100 SYSTEM INCLUDES 33422D1 15782 3/21/96 3,763.93
MEDIUM TOWER
TRITON 586 MOTHERBOARD, INTEL 100MHZ
CPU & XXXXXXX FAN,
2 16MB RAM MEMORY
1.44MB FLOPPY DRIVE, XXXXXX 1.2GB IDE
HARD DRIVE
INT. 4X CD-ROM IDE, 3C508COMBO
ETHERLINK III, VGA PCI TR1064
W2MB, ACER 101 TOUCH KEYBOARD, MS-II
ERGONOMIC MOUSE
MS WINDOWS 95 INSTALLED
NEC XE17" MULTYSYNE MONITOR JC-1733VMA
MS OFFICE PRO W/BOOKSHELF WIN 95
W/DOCS CD ROM
NCA COMPUTER PRODUCTS 2 NEC XV17" PLUS MONITORS 6203574RA 253387 3/25/96 1,788.54
6207192RA
JEM AMERICA CORP. 1 PROBE CARD FOR TESTING 20851 3/19/96 2,371.04
VOICE PRO 1 VOICE PRO VOICE MAIL SYSTEM AND 40
PHONES 13158-IN 5/6/96 27,209.60
----------
607,652.52
Page 3
X. Additional Terms and Conditions:
-------------------------------
By execution of this Lease Schedule, Xxxxxx and Lessor agree that the
additional terms, conditions and/or provisions set forth in any
Rider(s) attached hereto shall be incorporated by this reference in
this Lease Schedule and the Master Lease with respect to the items of
Equipment described in this Lease Schedule. In the event of any
conflict between the provisions of any Rider and the Master Lease, the
terms of the Rider shall be controlling.
If a Schedule B is attached hereto, such Schedule B sets forth the
----------
Stipulated Loss Value of the accepted Equipment.
XI. Entire Agreement:
----------------
XXXXXX REPRESENTS THAT IT HAS READ, RECEIVED, RETAINED A COPY OF AND
UNDERSTANDS THIS LEASE SCHEDULE, AND AGREES TO BE BOUND BY ITS TERMS
AND CONDITIONS. XXXXXX AND XXXXXX AGREE THAT THIS LEASE SCHEDULE, ALL
RIDERS AND SCHEDULES HERETO, AND THE MASTER LEASE SHALL CONSTITUTE THE
ENTIRE LEASE AND AGREEMENT AND SUPERSEDE ALL PROPOSALS, ORAL OR
WRITTEN, ALL PRIOR NEGOTIATIONS AND ALL OTHER COMMUNICATIONS BETWEEN
LESSOR AND LESSEE WITH RESPECT TO ANY ITEM OF EQUIPMENT.
THIS LEASE SCHEDULE IS NOT CANCELLABLE BY LESSEE FOR THE TERM HEREOF.
4
TO THE EXTENT THAT THIS LEASE SCHEDULE CONSTITUTES CHATTEL PAPER (AS
DEFINED IN THE UNIFORM COMMERCIAL CODE, AS IN EFFECT IN ANY APPLICABLE
JURISDICTION), NO SECURITY INTEREST HEREIN MAY BE CREATED EXCEPT THROUGH THE
TRANSFER OR POSSESSION OF THE ORIGINAL EXECUTED "COUNTERPART NO. 1" OF THIS
LEASE SCHEDULE, WHICH SHALL BE IDENTIFIED AS THE ORIGINAL EXECUTED COUNTERPART
NO. 1 BELOW.
IN WITNESS WHEREOF, the parties hereto have caused this Lease Schedule
to be duly executed on the date set forth below by their authorized
representative.
LESSOR: LESSEE:
VENTURE LENDING & LEASING, INC. NEOMAGIC CORPORATION
By: /s/ Xxxxxxxx X. Xxxxxxxxx By: /s/ Xxxx Xxxxxxx
-------------------------- --------------------------
Name: XXXXXXXX X. XXXXXXXXX Name: XXXX XXXXXXX
------------------------ ------------------------
Title: President Title: VP & CFO
----------------------- -----------------------
Date: 6/26/96 Date: 6/26/96
---------------------- ------------------------
This is Counterpart No. 2 of 2 counterparts
--- ---
Sg
------------------------
(Lessor's initials)
5
SCHEDULE B
This schedule is attached to and becomes a part of Lease Schedule No.
48-001 to Master Equipment Lease Agreement dated June 28, 1996 between the
undersigned, as Lessee, and VENTURE LENDING & LEASING, INC., as Lessor.
STIPULATED LOSS VALUE SCHEDULE FOR BASIC TERM
Lease Period Prior to Stipulated Lease Period Prior to Stipulated
Rental Payment No. Loss Value (1) Rental Payment No. Loss Value (1)
------------------ ---------- ------------------ ----------
1 115.00 25 55.00
2 112.50 26 52.50
3 110.00 27 50.00
4 107.50 28 47.50
5 105.00 29 45.00
6 102.50 30 42.50
7 100.00 31 40.00
8 97.50 32 37.50
9 95.00 33 35.00
10 92.50 34 32.50
11 90.00 34 30.00
12 87.50 36 27.50
13 85.00 37 25.00
14 82.50 38 22.50
15 80.00 39 20.00
16 77.50 40 17.50
17 75.00 41 15.00
18 72.50 42 12.50
19 70.00 Thereafter 10.00
20 67.50
21 65.00
22 62.50
23 60.00
24 57.50
(1) Percentage of Equipment Cost
This Schedule B is hereby verified by the undersigned who acknowledges receipt
of a Copy.
LESSEE: NEOMAGIC CORPORATION
BY:/s/ Xxxx Xxxxxxx
----------------------------
TITLE: XXXX XXXXXXX
-------------------------
[LOGO OF WESTERN TECHNOLOGY INVESTMENT APPEARS HERE]
PAYMENT INSTRUCTION LETTER
EQUIPMENT LEASE SCHEDULE NUMBER 48-001
Date: June 24, 1996
NEOMAGIC CORPORATION
0000 Xxx Xxxxxx
Xxxxx Xxxxx, XX 00000
RE: Equipment Lease Schedule No. 48-001 ("Lease Schedule") to Master Equipment
Lease Agreement dated June 28, 1996 ("Lease") between NEOMAGIC CORPORATION,
as Lessee and VENTURE LENDING & LEASING, INC., as Lessor
Dear Xxxxx:
Pursuant to Article 3 of the above referenced Lease and Sections V and VI of the
above referenced Lease Schedule, Rent Payment Dates and Lease Rental Payments
are due and payable as follows:
Advance Payment Breakdown:
Description Rent Payment Payment Date
----------- ---- ------- ------- ----
First Rent Payment 17,439.63 In Advance
Last Rent Payment 17,436.63 In Advance
----------
Total Advance Payments $34,879.26
Commencing on July 1, 1996 consecutive Rent Payments are due and payable on
the first day of each month as indicated below:
42 Lease Rental Payments in the amount of $17,439.63 each first and last
paid in advance
1 final payment due on January 1, 2000 as indicated in Item VI of
Equipment Lease Schedule No. 48-001
Commencing on August 1, 1996, please send your remittance to the following
address using the loan transaction Number indicated below on each remittance.
Your checks should be made payable to Venture Lending & Leasing, Inc.
Loan payment remittance address:
Bank of Boston
Payment Unit
P.O. Box 1323
Providence, RI 02901-1323
Loan Transaction No. X00000000
---------
NEOMAGIC CORPORATION
Payment Instruction Letter for Lease Schedule No. 48-001
June 24, 1996
Page 2
PLEASE BE ADVISED THAT THIS IS THE ONLY PAYMENT NOTICE YOU WILL RECEIVE. WE DO
------ -- ------- ---- ---- -- --- ---- ------- ------ --- ---- -------- -- --
NOT PROCESS MONTHLY INVOICES.
--- ------- ------- --------
Please acknowledge your receipt of this letter by signing the enclosed
counterpart of this letter where indicated below.
Sincerely
/s/ Xxxxx Xxxxx
Xxxxx Xxxxx
Lease Administrator
Acknowledged and agreed to:
NEOMAGIC CORPORATION
By: /s/ Xxxx Xxxxxxx
---------------------------
Title: VP & CFO
------------------------
Date: 6/26/96
-------------------------
LEASE SCHEDULE NO. 48-002
TO
MASTER EQUIPMENT LEASE AGREEMENT
--------------------------------
TO THE EXTENT THAT THIS LEASE SCHEDULE CONSTITUTES CHATTEL PAPER (AS
DEFINED IN THE UNIFORM COMMERCIAL CODE, AS IN EFFECT IN ANY APPLICABLE
JURISDICTION), NO SECURITY INTEREST HEREIN MAY BE CREATED EXCEPT THROUGH THE
TRANSFER OR POSSESSION OF THE ORIGINAL EXECUTED "COUNTERPART NO. 1" OF THIS
LEASE SCHEDULE, WHICH SHALL BE IDENTIFIED ON THE SIGNATURE PAGE HEREOF.
This Lease Schedule is executed in accordance with the terms of the
Master Equipment Lease Agreement ("Master Lease") dated as of June 28, 1996 by
and between Venture Lending & Leasing, Inc., ("Lessor"), and NeoMagic
Corporation, a California corporation ("Lessee"). Unless otherwise expressly
defined herein, capitalized terms used herein shall have the same meaning as in
the Master Lease. All terms and conditions of the Master Lease are incorporated
herein by this reference.
I. Delivery and Acceptance Period:
------------------------------
Not later than September 30, 1996
II. Location(s) of Equipment:
------------------------
0000 Xxx Xxxxxx
Xxxxx Xxxxx, XX 00000
Mitsubishi Electric Corporation, Saijo Factory 8-6 Hiuchi
Saijo-City Erime-Prefecture 793 Japan
III. Term:
----
With respect to each item of Equipment, a Term of 42 months,
commencing on the first day of the month next following the date
of acceptance of such item hereunder by Xxxxxx; with an interim
Term commencing on the date of acceptance of such item and
continuing to but not including the first day of the Term.
IV. Equipment Cost:
--------------
"Equipment Cost" shall mean the total purchase price, paid or
financed by Lessor in respect of each item of Equipment.
V. Rent Payment Dates:
------------------
October 1, 1996 two (2) Rental Payments, first and last in
advance, and the payment of Rent of any interim Term; Forty
(40) consecutive monthly Rent payments on the first day of each
month commencing on November 1, 1996 to and including February
1, 2000 and April 1, 2000.
VI. Lease Rental Payments:
---------------------
With respect to each item of Equipment, a monthly amount equal
to 2.87% multiplied by the Equipment Cost of such item, in
advance; plus a final payment in an amount equal to 10%
multiplied by the Equipment Cost of such item, payable on the
first day of the month next following the last day of the Term.
Rent for any period less than a month shall be prorated daily
on the basis of a 30-day month.
VII. Lessee's Address:
----------------
0000 Xxx Xxxxxx
Xxxxx Xxxxx, XX 00000
VIII. Name and address of Lessor:
--------------------------
Venture Lending & Leasing, Inc.
0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000-0000
Address to which Rental and other payments are to be sent:
Bank of Boston
Payment Unit
P.O. Box 1323
Providence, RI 02901-1323
2
IX. Description of Equipment:
------------------------
Mfg. or I.D. or Unit Equipment
Quantity Vendor Description Serial Cost Cost
--------------------------------------------------------------------------------
(EQUIPMENT FULLY DESCRIBED ON ATTACHED EQUIPMENT LIST)
3
NEOMAGIC CORPORATION
EQUIPMENT LIST FOR LEASE SCHEDULE NO. 48-002
MANUFACTURER QTY DESCRIPTION SERIAL INVOICE INVOICE EQUIPMENT
OR NUMBER NUMBER DATE COST
VENDOR
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DNP AMERICA, INC. 1 PHOTOMASK 6" QZ EB PELLICLIZED 5X RETICLE LAYER: M1 56BUG 60983 7/2/96 35,400.00
1 PHOTOMASK 6" QZ EB PELLICLIZED 5X RETICLE NMG3 51BQG
1 PHOTOMASK 6" QZ EB PELLICLIZED 5X RETICLE LAYER VIA 61BUG
DNP AMERICA, INC. 1 PHOTOMASK 6" QZ EB PELLICLIZED 5X RETICLE LAYER M2 62BTG 60984 7/2/96 9,900.00
DNP AMERICA, INC. 1 PHOTOMASK 6" QZ EB PELLICLIZED 5X RETICLE 0.25U SPOT SIZE 62CTG 61000 7/8/96 9,900.00
WCS 1 VPM WINDOW 95 SUPPORT - RELEASE VERSION WITH SOURCE CODE 6163 6/28/96 5,200.00
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60,400.00
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X. Additional Terms and Conditions:
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By execution of this Lease Schedule, Xxxxxx and Lessor agree that
the additional terms, conditions and/or provisions set forth in
any Rider(s) attached hereto shall be incorporated by this
reference in this Lease Schedule and the Master Lease with
respect to the items of Equipment described in this Lease
Schedule. In the event of any conflict between the provisions of
any Rider and the Master Lease, the terms of the Rider shall be
controlling.
If a Schedule B is attached hereto, such Schedule B sets forth
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the Stipulated Loss Value of the accepted Equipment.
XI. Entire Agreement:
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XXXXXX REPRESENTS THAT IT HAS READ, RECEIVED, RETAINED A COPY OF
AND UNDERSTANDS THIS LEASE SCHEDULE, AND AGREES TO BE BOUND BY
ITS TERMS AND CONDITIONS. XXXXXX AND XXXXXX AGREE THAT THIS LEASE
SCHEDULE, ALL RIDERS AND SCHEDULES HERETO, AND THE MASTER LEASE
SHALL CONSTITUTE THE ENTIRE LEASE AND AGREEMENT AND SUPERSEDE ALL
PROPOSALS, ORAL OR WRITTEN, ALL PRIOR NEGOTIATIONS AND ALL OTHER
COMMUNICATIONS BETWEEN LESSOR AND LESSEE WITH RESPECT TO ANY ITEM
OF EQUIPMENT.
THIS LEASE SCHEDULE IS NOT CANCELLABLE BY LESSEE FOR THE TERM HEREOF.
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TO THE EXTENT THAT THIS LEASE SCHEDULE CONSTITUTES CHATTEL PAPER (AS
DEFINED IN THE UNIFORM COMMERCIAL CODE, AS IN EFFECT IN ANY APPLICABLE
JURISDICTION), NO SECURITY INTEREST HEREIN MAY BE CREATED EXCEPT THROUGH THE
TRANSFER OR POSSESSION OF THE ORIGINAL EXECUTED "COUNTERPART NO. 1" OF THIS
LEASE SCHEDULE, WHICH SHALL BE IDENTIFIED AS THE ORIGINAL EXECUTED COUNTERPART
NO. 1 BELOW.
IN WITNESS WHEREOF, the parties hereto have caused this Lease Schedule
to be duly executed on the date set forth below by their authorized
representative.
LESSOR: LESSEE:
VENTURE LENDING & LEASING, INC. NEOMAGIC CORPORATION
By:______________________ By: /s/ P.C. AGARWAL
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Name:____________________ Name: /s/ XXXXXXX XXXXXXX
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Title:___________________ Title: President/CEO
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Date:____________________ Date: 9/20/96
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This is Counterpart No. 1 of 2 counterparts
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__________________________
(Lessor's initials)
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SCHEDULE B
This schedule is attached to and becomes a part of Lease Schedule No.
48-002 to Master Equipment Lease Agreement dated June 28, 1996 between the
undersigned, as Lessee, and VENTURE LENDING & LEASING, INC., as Lessor.
STIPULATED LOSS VALUE SCHEDULE FOR BASIC TERM
Lease Period Prior to Stipulated Lease Period Prior to Stipulated
Rental Payment No. Loss Value(1) Rental Payment No. Loss Value(1)
------------------ ---------- ------------------ ----------
1 115.00 25 55.00
2 112.50 26 52.50
3 110.00 27 50.00
4 107.50 28 47.50
5 105.00 29 45.00
6 102.50 30 42.50
7 100.00 31 40.00
8 97.50 32 37.50
9 95.00 33 35.00
10 92.50 34 32.50
11 90.00 34 30.00
12 87.50 36 27.50
13 85.00 37 25.00
14 82.50 38 22.50
15 80.00 39 20.00
16 77.50 40 17.50
17 75.00 41 15.00
18 72.50 42 12.50
19 70.00 Thereafter 10.00
20 67.50
21 65.00
22 62.50
23 60.00
24 57.50
(1) Percentage of Equipment Cost
This Schedule B is hereby verified by the undersigned who acknowledges receipt
of a Copy.
LESSEE: NEOMAGIC CORPORATION
BY: /s/ P.C. Agarwal
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TITLE: President/CEO
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[LOGO OF WESTERN TECHNOLOGY INVESTMENT APPEARS HERE]
PAYMENT INSTRUCTION LETTER
EQUIPMENT LEASE SCHEDULE NUMBER 48-002
Date: September 17, 1996
NEOMAGIC CORPORATION
0000 Xxx Xxxxxx
Xxxxx Xxxxx, XX 00000
RE: Equipment Lease Schedule No. 48-002 ("Lease Schedule") to Master Equipment
Lease Agreement dated June 28, 1996 ("Lease") between NEOMAGIC CORPORATION,
as Lessee and VENTURE LENDING & LEASING, INC., as Lessor
Dear Xxxxx:
Pursuant to Article 3 of the above referenced Lease and Sections V and VI of the
above referenced Lease Schedule, Rent Payment Dates and Lease Rental Payments
are due and payable as follows:
Advance Payment Breakdown:
Description Rent Payment Payment Date
----------- ---- ------- ------- ----
First Rent Payment 1,733.48 In Advance
Last Rent Payment 1,733.48 In Advance
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Total Advance Payments $ 3,466.96
Commencing on October 1, 1996 consecutive Rent Payments are due and payable
on the first day of each month as indicated below:
42 Lease Rental Payments in the amount of $1,733.48 each first and last
paid in advance
1 final payment due on April 1, 2000 as indicated in Item VI of
Equipment Lease Schedule No. 48-002
Commencing on November 1, 1996, please send your remittance to the following
address using the loan transaction Number indicated below on each remittance.
Your checks should be made payable to Venture Lending & Leasing, Inc.
Loan payment remittance address:
Bank of Boston
Payment Unit
P.O. Box 1323
Providence, RI 02901-1323
Loan Transaction No. 992991117
NEOMAGIC CORPORATION
Payment Instruction Letter for Lease Schedule No. 48-002
September 17, 1996
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PLEASE BE ADVISED THAT THIS IS THE ONLY PAYMENT NOTICE YOU WILL RECEIVE. WE DO
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NOT PROCESS MONTHLY INVOICES.
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Please acknowledge your receipt of this letter by signing the enclosed
counterpart of this letter where indicated below.
Sincerely,
/s/ Xxxxx Xxxxx
Xxxxx Xxxxx
Lease Administrator
Acknowledged and agreed to:
NEOMAGIC CORPORATION
By: /s/ P. C. Agarwal
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Title: President/CEO
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Date: 9/20/96
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