[LMSI LOGO] LEASE MANAGEMENT SERVICES, INC.
EQUIPMENT FINANCING AGREEMENT
(Number 10809)
THIS EQUIPMENT FINANCING AGREEMENT NUMBER 10809 ("Agreement") is dated as of
the date set forth at the foot hereof and is between LEASE MANAGEMENT
SERVICES, INC., ("Secured Party") and INTUITIVE SURGICAL, INC., ("Debtor").
1. EQUIPMENT; SECURITY INTEREST. The terms and conditions of this
Agreement cover each item of machinery, equipment and other property
(individually an "Item" or "Item of Equipment" and collectively the
"Equipment") described in a schedule now or hereafter executed by the parties
hereto and made a part hereof (individually a "Schedule" and collectively the
"Schedules"). Debtor hereby grants Secured Party a security interest in and
to all Debtor's right, title and interest in and to the Equipment under the
Uniform Commercial Code, such grant with respect to an Item of Equipment to
be as of Debtor's execution of a related Equipment Financing Commitment
referencing this Agreement or, if Debtor then has no interest in such Item,
as of such subsequent time as Debtor acquires an interest in the Item. Such
security interest is granted by Debtor to secure performance by Debtor of
Debtor's obligations to Secured Party hereunder and under any other
agreements under which Debtor has or may hereafter have obligations to
Secured Party. Debtor will ensure that such security interest will be and
remain a sole and valid first lien security interest subject only to the lien
of current taxes and assessment not in default but only if such taxes are
entitled to priority as a matter of law.
2. DEBTOR'S OBLIGATIONS. The obligations of Debtor under this Agreement
respecting an Item of Equipment, except the obligation to pay installment
payments with respect thereto which will commence as set forth in Paragraph 3
below, commence upon the grant to Secured Party of a security interest in the
Item. Debtor's obligations hereunder with respect to an Item of Equipment and
Secured Party's security interest therein will continue until payment of all
amounts due, and performance of all terms and conditions required hereunder
provided, however, that if this Agreement is in default said obligations and
security interest will continue during the continuance of said default. Upon
termination of Secured Party's security interest in an Item of Equipment,
Secured Party will execute such release of interest with respect thereto as
Debtor reasonably requests.
3. INSTALLMENT PAYMENTS AND OTHER PAYMENTS. Debtor will repay advances
Secured Party makes on account of the Equipment in installment payments in
the amounts and at the times set forth in the Schedules, whether or not
Secured Party has rendered an invoice therefor, at the office of Secured
Party set forth at the foot hereof, or to such person and/or at such other
place as Secured Party may from time to time designate by notice to Debtor.
Any other amounts required to be paid Secured Party by Debtor hereunder are
due upon Debtor's receipt of Secured Party's invoice therefor and will be
payable as directed in the invoice. Payments under this Agreement may be
applied to Debtor's then accrued obligations to Secured Party in such order
as Secured Party may choose.
4. NET AGREEMENT; NO OFFSET, SURVIVAL. This Agreement is a net
agreement, and Debtor will not be entitled to any abatement of installment
payments or other payments due hereunder or any reduction thereof under any
circumstance or for any reason whatsoever. Debtor hereby waives any and all
existing and future claims, as offsets, against any installment payments or
other payment due hereunder and agrees to pay the installment payments and
other amounts due hereunder as and when due regardless of any offset or claim
which may be asserted by Debtor or on its behalf. The obligations and
liabilities of Debtor hereunder will survive the termination of the Agreement.
5. FINANCING AGREEMENT. THIS AGREEMENT IS SOLELY A FINANCING AGREEMENT.
DEBTOR ACKNOWLEDGES THAT THE EQUIPMENT HAS OR WILL HAVE BEEN SELECTED AND
ACQUIRED SOLELY BY DEBTOR FOR DEBTOR'S PURPOSES, THAT SECURED PARTY IS NOT
AND WILL NOT BE THE VENDOR OF ANY
INTUITIVE SURGICAL, INC.
EQUIPMENT FINANCING AGREEMENT NUMBER 10809
PAGE 2 OF 8
EQUIPMENT AND THAT SECURED PARTY HAS NOT MADE AND WILL NOT MAKE ANY AGREEMENT,
REPRESENTATION OR WARRANTY WITH RESPECT TO THE MERCHANTABILITY, CONDITION,
QUALIFICATION OR FITNESS FOR A PARTICULAR PURPOSE OR VALUE OF THE EQUIPMENT
OR ANY OTHER MATTER WITH RESPECT THERETO IN ANY RESPECT WHATSOEVER.
6. NO AGENCY. DEBTOR ACKNOWLEDGES THAT NO AGENT OF THE MANUFACTURER OR
OTHER SUPPLIER OF AN ITEM OF EQUIPMENT OR OF ANY FINANCIAL INTERMEDIARY IN
CONNECTION WITH THIS AGREEMENT IS AN AGENT OF SECURED PARTY. SECURED PARTY IS
NOT BOUND BY A REPRESENTATION OF ANY SUCH PARTY AND, AS CONTEMPLATED IN
PARAGRAPH 27 BELOW, THE ENTIRE AGREEMENT OF SECURED PARTY AND DEBTOR
CONCERNING THE FINANCING OF THE EQUIPMENT IS CONTAINED IN THIS AGREEMENT AS IT
MAY BE AMENDED ONLY AS PROVIDED IN THAT PARAGRAPH.
7. ACCEPTANCE. Execution by Debtor and Secured Party of a Schedule
covering the Equipment or any Items thereof will conclusively establish that
such Equipment has been included under and will be subject to all the terms
and conditions of this Agreement. If Debtor has not furnished Secured Party
with an executed Schedule by the earlier of fourteen (14) days after receipt
thereof or expiration of the commitment period set forth in the applicable
Equipment Financing Agreement, Secured Party may terminate its obligation to
advance funds as to the applicable Equipment.
8. LOCATION; INSPECTION; USE. Debtor will keep, or in the case of motor
vehicles, permanently garage and not remove from the United States, as
appropriate, each Item of Equipment in Debtor's possession and control at the
Equipment Location designated in the applicable Schedule, or at such other
location to which such Item may have been moved with the prior written
consent of Secured Party. Whenever requested by Secured Party, Debtor will
advise Secured Party as to the exact location of an Item of Equipment. Secured
Party will have the right to inspect the Equipment and observe its use during
normal business hours, subject to Debtor's security procedures and to enter
into and upon the premises where the Equipment may be located for such
purpose. The Equipment will at all times be used solely for commercial or
business purposes and operated in a careful and proper manner and in
compliance with all applicable laws, ordinances, rules and regulations, all
conditions and requirements of the policy or policies of insurance required
to be carried by Debtor under the terms of this Agreement and all
manufacturer's instructions and warranty requirements. Any modifications or
additions to the Equipment required by any such governmental edict or
insurance policy will be promptly made by Debtor.
9. ALTERATIONS; SECURITY INTEREST COVERAGE. Without the prior written
consent of Secured Party, Debtor will not make any alterations, additions or
improvements to any Item of Equipment which detract form its economic value
or functional utility, except as may be required pursuant to Paragraph 8
above. Secured Party's security interest in the Equipment will include all
modifications and additions thereto and replacements and substitutions
therefor, in whole or in part. Such reference to replacements and
substitutions will not grant Debtor greater rights to replace or substitute
than are provided in Paragraph 11 below or as may be allowed upon the prior
written consent of Secured Party.
10. MAINTENANCE. Debtor will maintain the Equipment in good repair,
condition and working order. Debtor will also cause each Item of Equipment
for which a service contract is generally available to be covered by such a
contract which provides coverages typical to property of the type involved
and is issued by a competent servicing entity.
11. LOSS AND DAMAGE; CASUALTY VALUE. In the event of the loss of, theft
of, requisition of, damage to or destruction of an Item of Equipment
("Casualty Occurrence"), Debtor will give Secured Party prompt notice
thereof and will thereafter place such Item in good repair,
INTUITIVE SURGICAL, INC.
EQUIPMENT FINANCING AGREEMENT NUMBER 10809
PAGE 3 OF 8
condition and working order, provided, however, that if such Item is
determined by Secured Party to be lost, stolen, destroyed or damaged beyond
repair, is requisitioned or suffers a constructive total loss as defined in
any applicable insurance policy carried by Debtor in accordance with
Paragraph 14 below, Debtor, at Secured Party's option, will (a) replace such
Item with like Equipment in good repair, condition and working order
whereupon such replacement equipment will be deemed such Item for all
purposes hereof or (b) pay Secured Party the "Casualty Value" of such Item
which will equal the total of (i) all installment payments and other amounts
due from Debtor to Secured Party at the time of such payment and (ii) future
installment payments due with respect to such Item with each such payment
including any final uneven payment discounted at a rate equal to the discount
rate of the Federal Reserve Bank of San Francisco from the date due to the
date of such payment.
Upon such replacement or payment, as appropriate, this Agreement and Secured
Party's security interest will terminate with, and only with, respect to the
Item of Equipment so replaced or as to which such payment is made in
accordance with Paragraph 2 above.
12. TITLING; REGISTRATION. Each item of Equipment subject to title
registration laws will at all times be titled and/or registered by Debtor as
Secured Party's agent and attorney-in-fact with full power and authority to
register (but without power to affect title to) the Equipment in such manner
and in such jurisdiction or jurisdictions as Secured Party directs. Debtor
will promptly notify Secured Party of any necessary or advisable retitling
and/or registration of an Item of Equipment in a jurisdiction other than
the one in which such Item is then titled and/or registered. Any and all
documents of title will be furnished or caused to be furnished Secured Party
by Debtor within sixty (60) days of the date any titling or registering or
restating or deregistering, as appropriate, is directed by Secured Party.
13. TAXES. Debtor will make all filings as to and pay when due all
personal property and other ad valorem taxes and all other taxes, fees,
charges and assessments based on the ownership or use of the Equipment and
will pay as directed by Secured Party or reimburse Secured Party for all
other taxes, including, but not limited to, gross receipt taxes (exclusive of
federal and state taxes based on Secured Party's net income, unless such net
income taxes are in substitution for or relieve Debtor from any taxes which
Debtor would otherwise be obligated to pay under the terms of this Paragraph
13), fees, charges and assessments whatsoever, however designated, whether
based on the installment payments or other amounts due hereunder, levied,
assessed or imposed upon the Equipment or otherwise related hereto or to the
Equipment, now or hereafter levied, assessed or imposed under the authority
of a federal, state, or local taxing jurisdiction, regardless of when and by
whom payable. Filings with respect to such other amounts will, at Secured
Party's option, be made by Secured Party or by Debtor as directed by Secured
Party.
14. INSURANCE. Debtor will procure and continuously maintain all risk
insurance against loss or damage to the Equipment from any cause whatsoever
for not less than the full replacement value thereof naming Secured Party as
Loss Payee. Such insurance must be in a form and with companies approved by
Secured Party, must provide at least thirty (30) days advance written notice
to Secured Party of cancellation, change or modification in any term,
condition, or amount of protection provided therein, must provide full breach
of warranty protection and must provide that the coverage is "primary
coverage" (does not require contribution from any other applicable coverage).
Debtor will provide Secured Party with an original policy or certificate
evidencing such insurance. In the event of an assignment of this Agreement of
which Debtor has notice, Debtor will cause such insurance to provide the same
protection to the assignee as its interests may appear. The proceeds of such
insurance, at the option of the Secured Party or such assignee, as
appropriate, will be applied toward (a) repair or replacement of the
appropriate Item or Items of Equipment, (b) payment of the Casualty Value
thereof and/or (c) payment of, or as provision for, satisfaction of any other
accrued obligations of Debtor hereunder. Debtor hereby appoints Secured Party
as Debtor's attorney-in-fact with full power and authority to do all things,
including, but not limited to, making claims, receiving payments and
endorsing documents, checks or drafts, necessary to secure payments due under
any policy contemplated hereby on account of a Casualty
INTUITIVE SURGICAL, INC.
EQUIPMENT FINANCING AGREEMENT NUMBER 10809
PAGE 4 OF 8
Occurrence. Debtor and Secured Party contemplate that the jurisdictions where
the Equipment will be located will not impose any liability upon Secured
Party for personal injury and/or property damage resulting out of the
possession, use, operation or condition of the Equipment. In the event
Secured Party determines that such is not or may not be the case with respect
to a given jurisdiction, Debtor will provide Secured Party with public
liability and property damage coverage applicable to the Equipment in such
amounts and in such form as Secured Party requires.
15. SECURED PARTY'S PAYMENT. If Debtor fails to pay any amounts due
hereunder or to perform any of its other obligations under this Agreement,
Secured Party may, at its option, but without any obligation to do so, pay
such amounts or perform such obligations, and Debtor will reimburse Secured
Party the amount of such payment or cost of such performance, plus interest at
1.5% per month.
16. INDEMNITY. Debtor does hereby assume liability for and does agree to
indemnify, defend, protect, save and keep harmless Secured Party from and
against any and all liabilities, losses, damages, penalties, claims, actions,
suits, costs, expenses and disbursements, including court costs and legal
expenses, of whatever kind and nature, imposed on, incurred by or asserted
against Secured Party (whether or not also indemnified against by any other
person) in any way relating to or arising out of this Agreement or the
manufacture, financing, ownership, delivery, possession, use, operation,
condition or disposition of the Equipment by Secured Party or Debtor,
including, without limitation, any claim alleging latent and other defects,
whether or not discoverable by Secured Party or Debtor, and any other claim
arising out of strict liability in tort, whether or not in either instance
relating to an event occurring while Debtor remains obligated under this
Agreement, and any claim for patent, trademark or copyright infringement.
Debtor agrees to give Secured Party and Secured Party agrees to give Debtor
notice of any claim or liability hereby indemnified against promptly
following learning thereof.
17. DEFAULT. Any of the following will constitute an event of default
hereunder: (a) Debtor's failure to pay when due any installment payment or
other amount due hereunder, which failure continues for ten (10) days after
the due date thereof; (b) Debtor's default in performing any other
obligation, term or condition of this Agreement or any other agreement
between Debtor and Secured Party or default under any further agreement
providing security for the performance by Debtor of its obligations hereunder
provided such default has continued for more than twenty (20) days, except as
provided in (c) and (d) hereinbelow, or, without limiting the generality of
subparagraph (l) hereinbelow, default under any lease or any mortgage or
other instrument contemplating the provision of financial accommodation
applicable to the real property where an Item of Equipment is located; (c)
any writ or order of attachment or execution or other legal process being
levied on or charged against any Item of Equipment and not being released or
satisfied within ten (10) days; (d) Debtor's failure to comply with its
obligations under Paragraph 14 above or any transfer by Debtor in violation
of Paragraph 21 below; (e) a non-appealable judgment for the payment of
money in excess of $100,000 being rendered by a court of record against
Debtor which Debtor does not discharge or make provision for discharge in
accordance with the terms thereof within ninety (90) days from the date of
entry thereof; (f) death or judicial declaration of incompetency of Debtor,
if an individual; (g) the filing by Debtor of a petition under the Bankruptcy
Code or any amendment thereto or under any other insolvency law or law
providing for the relief of debtors, including, without limitation, a petition
for reorganization, arrangement or extension, or the commission by Debtor of
an act of bankruptcy; (h) the filing against Debtor of any such petition not
dismissed or permanently stayed within thirty (30) days of the filing
thereof; (i) the voluntary or involuntary making of an assignment of
substantial portion of its assets by Debtor for the benefit of creditors,
appointment of a receiver or trustee for Debtor or for any of Debtor's
assets, institution by or against Debtor or any other type of insolvency
proceeding (under the Bankruptcy Code or otherwise) or of any formal or
informal proceeding for dissolution, liquidation, settlement of claims
against or winding up of the affairs of Debtor, Debtor's cessation of
business activities or the making by Debtor of a transfer of all or a
material portion of Debtor's assets or inventory not in the ordinary course
of business; (j) the occurrence of any event described in parts (e), (f),
(g), (h) or (i) hereinabove with respect to any guarantor or
INTUITIVE SURGICAL, INC.
EQUIPMENT FINANCING AGREEMENT NUMBER 10809
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other party liable for payment or performance of this Agreement; (k) any
certificate, statement, representation, warranty or audit heretofore or
hereafter furnished with respect hereto by or on behalf of Debtor or any
guarantor or other party liable for payment or performance of this Agreement
proving to have been false in any material respect at the time as of which
the facts therein set forth were stated or certified or having omitted any
substantial contingent or unliquidated liability or claim against Debtor or
any such guarantor or other party; (l) breach by Debtor of any lease or other
agreement providing financial accommodation under which Debtor or its property
is bound; or (m) a transfer of effective control of Debtor, if an
organization.
18. REMEDIES. Upon the occurrence of an event of default, Secured Party
will have the rights, options, duties and remedies of a Secured Party, and
Debtor will have the rights and duties of a debtor, under the Uniform
Commercial Code (regardless of whether such Code or a law similar thereto has
been enacted in a jurisdiction wherein the rights or remedies are asserted)
and, without limiting the foregoing, Secured Party may exercise any one or
more of the following remedies: (a) declare the Casualty Value or such
lesser amount as may be set by law immediately due and payable with respect
to any or all Items of Equipment without notice or demand to Debtor; (b) xxx
from time to time for and recover all installment payments and other
payments then accrued and which accrue during the pendency of such action
with respect to any or all Items of Equipment; (c) take possession of and,
if deemed appropriate, render unusable any or all Items of Equipment, without
demand or notice, wherever same may be located, without any court order or
other process of law and without liability for any damages occasioned by such
taking of possession and remove, keep and store the same or use and operate
or lease the same until sold; (d) require Debtor to assemble any or all
Items of Equipment at the Equipment Location therefor, or at such location
to which such Equipment may have been moved with the written consent of
Secured Party or such other location in reasonable proximity to either of the
foregoing as Secured Party designates; (e) upon ten (10) days notice to
Debtor or such other notice as may be required by law, sell or otherwise
dispose of any Item of Equipment, whether or not in Secured Party's
possession, in a commercially reasonable manner at public or private sale at
any place deemed appropriate and apply the new proceeds of such sale, after
deducting all costs of such sale, including, but not limited to, costs of
transportation, repossession, storage, refurbishing, advertising and brokers'
fees, to the obligations of Debtor to Secured Party hereunder or otherwise,
with Debtor remaining liable for any deficiency and with any excess being
returned to Debtor; (f) upon thirty (30) days notice to Debtor, retain any
repossessed or assembled Items of Equipment as Secured Party's own property
in full satisfaction of Debtor's liability for the installment payments due
hereunder with respect thereto, provided that Debtor will have the right to
redeem such Items by payment in full of its obligations to Secured Party
hereunder or otherwise or to require Secured Party to sell or otherwise
dispose of such Items in the manner set forth in subparagraph (e) hereinabove
upon notice to Secured Party within such thirty (30) day period; or (g)
utilize any other remedy available to Secured Party under the Uniform
Commercial Code or similar provision of law or otherwise at law or in equity.
No right or remedy conferred herein is exclusive of any other right or remedy
conferred herein or by law; but all such remedies are cumulative of every
other right or remedy conferred hereunder or at law or in equity, by statute
or otherwise, and may be exercised concurrently or separately from time to
time. Any sale contemplated by subparagraph (e) of this Paragraph 18 may be
adjourned from time to time by announcement at the time and place appointed
for such sale, or for any such adjourned sale, without further published
notice, Secured Party may bid and become the purchaser at any such sale. Any
sale of an Item of Equipment, whether under said subparagraph or by virtue of
judicial proceedings, will operate to divest all right, title, interest,
claim and demand whatsoever; either at law or in equity, of Debtor in and to
said item and will be a perpetual bar to any claim against such Item, both at
law and in equity, against Debtor and all persons claiming by, through or
under Debtor.
19. DISCONTINUANCE OF REMEDIES. If Secured Party proceeds to enforce any
right under this Agreement and such proceedings are discontinued or abandoned
for any reason or are
INTUITIVE SURGICAL, INC.
EQUIPMENT FINANCING AGREEMENT NUMBER 10809
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determined adversely, then and in every such case Debtor and Secured Party
will be restored to their former positions and rights hereunder.
20. SECURED PARTY'S EXPENSES. Debtor will pay Secured Party all costs and
expenses, including attorney's fees and court costs and sales costs not
offset against sales proceeds under Paragraph 18 above, incurred by Secured
Party in exercising any of its rights or remedies hereunder or enforcing any
of the terms, conditions or provisions hereof. This obligation includes the
payment or reimbursement of all such amounts whether an action is ultimately
filed and whether an action is ultimately dismissed.
21. ASSIGNMENT. Without the prior written consent of Secured Party, Debtor
will not sell, lease, pledge or hypothecate, except as provided in this
Agreement, any Item of Equipment or any interest therein or assign, transfer,
pledge, or hypothecate this Agreement or any interest in this Agreement or
permit the Equipment to be subject to any lien, charge or encumbrance of any
nature except the security interest of Secured Party contemplated hereby.
Debtor's interest herein is not assignable and will not be assigned or
transferred by operation of law. Consent to any of the foregoing prohibited
acts applies only in the given instance and is not a consent to any
subsequent like act by Debtor or any other person.
All rights of Secured Party hereunder may be assigned, pledged, mortgaged,
transferred or otherwise disposed of, either in whole or in part, without
notice to Debtor but always, however, subject to the rights of Debtor under
this Agreement. If Debtor is given notice of any such assignment, Debtor
will acknowledge receipt thereof in writing. In the event Secured Party
assigns this Agreement or the installment payments due or to become due
hereunder or any other interest herein, whether as security for any of its
indebtedness or otherwise, no breach or default by Secured Party hereunder or
pursuant to any other agreement between Secured Party and Debtor, should
there be one, will excuse performance by Debtor of any provision hereof, it
being understood that in the event of such default or breach by Secured Party
that Debtor will pursue any rights on account thereof solely against Secured
Party. No such assignee, unless such assignee agrees in writing, will be
obligated to perform any duty, covenant or condition required to be performed
by Secured Party in connection with this Agreement.
Subject always to the foregoing, this Agreement inures to the benefit of, and
is binding upon, the heirs, legatees, personal representative, successors and
assigns of the parties hereto.
22. MARKINGS; PERSONAL PROPERTY. If Secured Party supplies Debtor with
labels, plates, decals or other markings stating that Secured Party has an
interest in the Equipment, Debtor will affix and keep the same prominently
displayed on the Equipment or will otherwise xxxx the Equipment or its then
location or locations, as appropriate, at Secured Party's request to indicate
Secured Party's security interest in the Equipment. The Equipment is, and at
all times will remain, personal property notwithstanding that the Equipment
or any Item thereof may now be, or hereafter become, in any manner affixed or
attached to, or embedded in, or permanently resting upon real property or any
improvement thereof or attached in any manner to what is permanent as by
means of cement, plaster, nails, bolts, screws or otherwise. If requested by
Secured Party, Debtor will obtain and deliver to Secured Party waivers of
interest or liens in recordable form satisfactory to Secured Party from all
persons claiming any interest in the real property on which an Item of
Equipment is or is to be installed or located.
23. LATE CHARGES. Time is of the essence in this Agreement and if any
Installment Payment is not paid within ten (10) days after the due date
thereof, Secured Party shall have the right to add and collect, and Debtor
agrees to pay: (a) a late charge on and in addition to, such Installment
Payment equal to five percent (5%) of such Installment Payment or a lesser
amount if established by any state or federal statute applicable thereto, and
(b) interest on such Installment Payment from thirty (30) days after the due
date until paid at the highest contract rate enforceable against Debtor under
applicable law but never to exceed eighteen percent (18%) per annum.
INTUITIVE SURGICAL, INC.
EQUIPMENT FINANCING AGREEMENT NUMBER 10809
PAGE 7 OF 8
24. NON-WAIVER. No covenant or condition of this Agreement can be waived
except by the written consent of Secured Party. Forbearance or indulgence by
Secured Party in regard to any breach hereunder will not constitute a waiver
of the related covenant or condition to be performed by Debtor.
25. ADDITIONAL DOCUMENTS. In connection with and in order to perfect and
evidence the security interest in the Equipment granted Secured Party
hereunder Debtor will execute and deliver to Secured Party such financing
statements and similar documents as Secured Party requests. Debtor
authorizes Secured Party where permitted by law to make filings of such
financing statements without Debtor's signature. Debtor further will furnish
Secured Party (a) on a timely basis, Debtor's future financial statements,
including Debtor's most recent annual report, balance sheet and income
statement, prepared in accordance with generally accepted accounting
principles, which reports, Debtor warrants, shall fully and fairly represent
the true financial condition of Debtor (b) any other information normally
provided by Debtor to the public and (c) such other financial data or
information relative to this Agreement and the Equipment, including, without
limitation, copies of vendor proposals and purchase orders and agreements,
listings of serial numbers or other identification data and confirmations of
such information, as Secured Party may from time to time reasonably request.
Debtor will procure and/or execute, have executed, acknowledge, have
acknowledged, deliver to Secured Party, record and file such other documents
and showings as Secured Party deems necessary or desirable to protect its
interest in and rights under this Agreement and interest in the Equipment.
Debtor will pay as directed by Secured Party or reimburse Secured Party for
all filing, search, title report, legal and other fees incurred by Secured
Party in connection with any documents to be provided by Debtor pursuant to
this Paragraph or Paragraph 22 and any further similar documents Secured
Party may procure.
26. DEBTOR'S WARRANTIES. Debtor certifies and warrants that the financial
data and other information which Debtor has submitted, or will submit, to
Secured Party in connection with this Agreement is, or will be at time of
delivery, as appropriate, a true and complete statement of the matters
therein contained. Debtor further certifies and warrants: (a) this
Agreement has been duly authorized by Debtor and when executed and delivered
by the person signing on behalf of Debtor below will constitute the legal,
valid and binding obligation, contract and agreement of Debtor enforceable
against Debtor in accordance with its respective terms; (b) this Agreement
and each and every showing provided by or on behalf of Debtor in connection
herewith may be relied upon by Secured Party in accordance with the terms
thereof notwithstanding the failure of Debtor or other applicable party to
ensure proper attestation thereto, whether by absence of a seal or
acknowledgement or otherwise; (c) Debtor has the right, power and authority
to grant a security interest in the Equipment to Secured Party for the uses
and purposes herein set forth and (d) each Item of Equipment will, at the
time such Item becomes subject hereto, be in good repair, condition and
working order.
27. ADDITIONAL SECURITY. As additional security to secure the performance
of the Debtor's obligations under this Agreement and the Schedules hereto,
Debtor grants to the Secured Party a security interest in all of its fixed
assets, including, but not limited to, lab, test, computer and office
equipment and modifications and additions thereto and replacements and
substitutions therefor and the proceeds thereof including insurance proceeds,
now owned or hereafter acquired between the date of this Agreement and the
later of (a) January 31, 1998 or (b) the expiration of the funding period
under the credit approval dated February 14, 1997 (collectively, the
"Additional Equipment").
The Debtor shall have all of the obligations with respect to the Additional
Equipment as it has with respect to the Equipment as set forth in this
Agreement.
28. ENTIRE AGREEMENT. This instrument with exhibits and related
documentation constitutes the entire agreement between Secured Party and
Debtor and will not be amended, altered or changed except by a written
agreement signed by the parties.
INTUITIVE SURGICAL, INC.
EQUIPMENT FINANCING AGREEMENT NUMBER 10809
PAGE 8 OF 8
29. NOTICES. Notices under this Agreement must be in writing and must be
mailed by United States mail, certified mail with return receipt requested,
duly addressed, with postage prepaid, to the party involved at its respective
address set forth at the foot hereof or at such other address as each party
may provide on notice to the other from time to time. Notices will be
effective when deposited. Each party will promptly notify the other of any
change in that party's address.
30. GENDER, NUMBER: JOINT AND SEVERAL LIABILITY. Whenever the context of
this Agreement requires, the neuter gender includes the feminine or masculine
and the singular number includes the plural; and whenever the words "Secured
Party" are used herein, they include all assignees of Secured Party, it being
understood that specific reference to "assignee" in Paragraph 14 above is for
further emphasis. If there is more than one Debtor named in this Agreement,
the liability of each will be joint and several.
31. TITLES. The titles to the Paragraphs of this Agreement are solely for
the convenience of the parties and are not an aid in the interpretation of
the instrument.
32. GOVERNING LAW; VENUE. This Agreement will be governed by and construed
in accordance with the laws of the State of California. Venue for any action
related to the Agreement will be in an appropriate court in San Mateo County,
California, to which Debtor consents, or in another court selected by Secured
Party which has jurisdiction over the parties. In the event any provision
hereof is declared invalid, such provision will be deemed severable from the
remaining provisions of this Agreement, which will remain in full force and
effect.
33. TIME. Time is of the essence of this Agreement and for each and all of
its provisions.
In WITNESS WHEREOF, the undersigned have executed this Agreement as of
4/2, 1997.
DEBTOR:
INTUITIVE SURGICAL, INC.
0000 X. Xxxxxxxxxxx Xxxx
Xxxxxxxx Xxxx, XX 00000
By: /s/ X.X. Xxxxxx
_________________________________________
Title: Consultant
_________________________________________
SECURED PARTY:
LEASE MANAGEMENT SERVICES, INC.
0000 Xxxx XXxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
By: /s/ Xxxxxxx X. Xxxxxx
_________________________________________
Title: EVP/General Manager
_________________________________________
ADDENDUM TO EQUIPMENT FINANCING AGREEMENT NUMBER #10809
BETWEEN
INTUITIVE SURGICAL, INC. ("DEBTOR")
AND
LEASE MANAGEMENT SERVICES, INC. ("SECURED PARTY")
The printed form of Equipment Financing Agreement #10809 between the
parties dated April 2, 1997 is amended as follows:
1. In Section 1, line 11 before the word "agreement" insert "equipment
lease or equipment financing."
2. In Section 4, line 3, before "Debtor" insert "To the extent not
prohibited by law."
3. In Section 7, change "fourteen (14) days" to "thirty (30) days" in the
second sentence.
4. In Section 8, line 5, after the first occurrence of "Secured Party."
insert ", except that Secured Party's consent shall not be required when
Debtor's principle place of business is relocated within the continental
United States. Debtor shall give Secured Party thirty (30) days advance
written notice of Debtor's intent to relocate an Item of Equipment within the
continental United States. If Debtor is in default as defined in Section 17
herein, Debtor may not relocate an Item of Equipment without the prior
written consent of Secured Party, such consent shall not be unreasonably
withheld."
5. In Section 8, line 6, before the second occurrence of "Secured Party."
insert "Upon Prior reasonable notice,".
6. In Section 8, line 9, after "commercial" insert ",research and
development."
7. In Section 10, line 2, after "also" insert "either."
8. At the end of Section 10, after "entity" insert "or provide
comparable maintenance and repair services."
9. In Section 11, line 7, after the word "below" insert "Secured Party
shall first consult with Debtor and then.", and in line 13, replace "the
Federal Reserve Bank of San Francisco" with nine percent (9%)."
1.
10. Section 14, delete section in its entirety and replace with
"14. INSURANCE Debtor will procure and continuously maintain insurance against
loss (other than by reason of war, acts of God, riot, earthquake, flood or
the like) or damage to the Equipment from any reasonable risk whatsoever for
not less than the full replacement value thereof naming Secured Party as Loss
Payee as its interest may appear. Such insurance must be in a form and with
companies reasonably approved by Secured Party, must provide at least thirty
(10) days advance written notice to Secured Party of cancellation, change or
modification in any term, condition, or amount of protection provided
therein, must provide full breach of warranty protection and must provide
that the coverage is "primary coverage" (does not require contribution from
any other applicable coverage). Debtor will provide Secured Party with an
original policy or certificate evidencing such insurance. In the event of an
assignment of this Agreement of which Debtor has notice, Debtor will cause
such insurance to provide the same protection to the assignee as its interest
may appear. The proceeds of such insurance, at the option of the Secured
Party or such assignee (after consultation with Debtor), as appropriate, will
be applied toward (a) repair or replacement of the appropriate Item or items
of Equipment (b) payment of the Casualty Value thereof and/or (c) payment of,
or as provision for, satisfaction of any other accrued obligations of Debtor
hereunder. Debtor hereby appoints Secured Party as Debtor's attorney-in-fact
will full power and authority, if an Event of Default has occurred and is
continuing, to do all things, including, but not limited to, making claims,
receiving payments and endorsing documents, checks or drafts, necessary to
secure payments due under any policy contemplated hereby on account of a
Casualty Occurrence. Debtor and Secured Party contemplate that the
jurisdictions where the Equipment will be located will not impose any
liability upon Secured Party for personal injury and/or property damage
resulting out of the possession, use, operation or condition of the
Equipment. In the event Secured Party determines that such is not or may not
be the case with respect to a given jurisdiction, Debtor will provide Secured
Party with public liability and property damage coverage applicable to the
Equipment in such amounts and in such form as Secured Party reasonably
requires, PROVIDED, HOWEVER, that public liability insurance with primary
limits of $1,000,000 per occurrence with an excess policy of $2,000,000,
shall be deemed to satisfy this requirement."
11. Section 15, at the beginning of the section insert "Subject to
Section 23 below,".
12. Section 16, line 4, after the phrase "kind and nature" insert,
", except any of the foregoing resulting from Secured Party's gross negligence
or willful misconduct,".
13. In Section 17(h), change "thirty (30) days" to "sixty (60) days."
14. In Section 17(i), at the end of the clause insert ", except for
the purposes of a change in Debtor's state of incorporation."
15. Section 17(k), at the end of the clause insert "in excess of
$50,000 per item or in the aggregate."
2.
16. In Section 17(k), after the words "or having" insert "knowingly."
17. In Section 17(m), insert "subject to Section 21," at the
beginning of the clause.
18. Section 17(l), delete the section and replace it with "breach,
in excess of $50,000 per item or in the aggregate, by Debtor of any lease or
other agreement providing financial accommodation under which Debtor or its
property is bound, which breach is not cured or with respect to which no
provision has been made to cure within twenty (20) days;".
19. Section 18, line 1, insert the following in front of the
beginning of the first sentence of the section: "Except as provided
otherwise in this Agreement (as amended by this Addendum)."
20. In Section 18, (e) change "ten (10) days" to "fifteen (15) days."
21. In Section 18, second paragraph, line 4, after "Any" insert
"lawful."
22. In Section 19, line 2, delete "or are determined adversely."
23. Section 20, line 1, insert "reasonable" between "all" and "cost."
24. Section 20, line 2, "reasonable" between "including" and
"attorney's."
25. Section 20, line 6, after "dismissed" insert ", provided that
the cost and expenses were incurred in the good faith exercise of Secured
Party's rights and remedies hereunder."
26. Section 21, line 4, after "Agreement" insert "(except in each
such case, for purposes of changing Debtor's state of incorporation)."
27. Section 21, line 5, before "Debtor's" insert "Except as provided
in the previous sentence."
28. Section 24, line 1, after "condition" insert "to be performed by
Debtor."
29. Section 25, line 4, insert "reasonably" before "requests."
30. Section 25, line 17, insert "reasonable" between "report," and
"legal" and between "other" and "fees."
31. Section 25(b), after "other" insert "financial."
32. Section 25, line 15, delete "or desirable."
3.
33. Section 25(c), delete the last sentence and replace it with
"Debtor will pay as directed by Secured Party or reimburse Secured Party for
all Uniform Commercial Code filings by Secured Party against Debtor and all
search reports conducted with respect to the debtor."
34. Section 27 append after last sentence to first paragraph
"Notwithstanding the foregoing, in no event shall Secured Party have any
right or interests in any intellectual property incorporated, associated or
related to the Additional Equipment."
35. Section 29, line 5, after "effective" replace "when" with "upon
the earlier of receipt or three days after."
36. Section 32, line 4, after "Secured Party" insert", to which Debtor
consents."
IN WITNESS WHEREOF, the undersigned have executed this Addendum this 2nd
day of April, 1997.
DEBTOR SECURED PARTY:
INTUITIVE SURGICAL, INC. LEASE MANAGEMENT SERVICES, INC.
By: /s/ X.X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxxx
---------------------------- -------------------------
Title: Consultant Title: EVP/GM
------------------------- ----------------------
4.
[LMSI LOGO] LEASE MANAGEMENT SERVICES, INC.
ADDENDUM TO
EQUIPMENT FINANCING AGREEMENT
NUMBER 10809
BY AND BETWEEN
INTUITIVE SURGICAL, INC., AS DEBTOR
AND
LEASE MANAGEMENT SERVICES, INC., AS SECURED PARTY
INTUITIVE SURGICAL, INC., as Debtor, hereby acknowledges its responsibility
to pay, and agrees to pay any taxes which may be due to the State of
California or where applicable, for the collateral covered under the above
referenced agreement.
DEBTOR:
INTUITIVE SURGICAL, INC.
By: /s/ X.X. Xxxxxx
------------------------
Title: Consultant
------------------------
Date: 4/2/97
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