MASTER LEASE AGREEMENT
THIS MASTER LEASE AGREEMENT, dated as of June 28, 1995, ("Agreement"),
between General Electric Capital Corporation, with an office at 000
Xxxxxxxxxxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxxxx, XXXXXXXX 00000, (hereinafter
called, together with its successors and assigns, if any, "Lessor"), and
Applied Microbiology, Inc., a corporation, organized and existing under the
laws of the State of New York, with its mailing address and chief place of
business at 000 Xxx Xxx Xxxx Xxxxx Xxxx, Xxxxxxxxx, XX 00000 (hereinafter
called "Lessee").
WITNESSETH:
I. LEASING:
(a) Subject to the terms and conditions set forth below, Lessor agrees
to lease to Lessee, and Lessee agrees to lease from Lessor, the equipment
("Equipment") described in Annex A to any schedule hereto ("Schedule") and
this Agreement shall be effective from and after the date of execution hereof.
Terms defined in a Schedule and not otherwise defined herein shall have the
meanings ascribed to them in such Schedule.
(b) The obligation of Lessor to purchase Equipment from the manufacturer
or supplier thereof ("Supplier"), and to lease the same to Lessee under any
Schedule shall be subject to receipt by Lessor, prior to the Lease
Commencement Date (with respect to such Equipment), of each of the following
documents in form and substance satisfactory to Lessor: (i) a Schedule
relating to the Equipment then to be leased hereunder, (ii) a Purchase Order
Assignment and Consent in the form of Annex B to the applicable Schedule,
unless Lessor shall have delivered its purchase order for such Equipment,
(iii) evidence of insurance which complies with the requirements of Section X,
and (iv) such other documents as Lessor may reasonably request. As a further
condition to such obligations of Lessor, Lessee shall, upon delivery of such
Equipment (but not later than the Last Delivery Date specified in the
applicable Schedule) execute and deliver to Lessor a Certificate of Acceptance
(in the form of Annex C to the applicable Schedule) covering such Equipment.
Lessor hereby appoints Lessee its agent for inspection and acceptance of the
Equipment from the Supplier. Upon execution by Lessee of any Certificate of
Acceptance, the Equipment described thereon shall be deemed to have been
delivered to, and irrevocably accepted by, Lessee for lease hereunder.
II. TERM, RENT AND PAYMENT:
(a) The rent payable hereunder and Lessee's right to use the Equipment
shall commence on the date of execution by Lessee of the Certificate of
Acceptance for such Equipment ("Lease Commencement Date"). The term of this
Agreement shall be the period specified in the applicable Schedule. If any
term is extended, the word "term" shall be deemed to refer to all extended
terms, and all provisions of this Agreement shall apply during any extended
terms, except as may be otherwise specifically provided in writing.
(b) Rent shall be paid to Lessor at its address stated above, except as
otherwise directed by Lessor. Payments of rent shall be in the amount set
forth in, and due in accordance with, the provisions of the applicable
Schedule. If one or more Advance Rentals are payable, such Advance Rental
shall be (i) set forth on the applicable Schedule, (ii) due upon acceptance by
Lessor of such Schedule, and (iii) when received by Lessor, applied to the
first rent payment and the balance, if any, to the final rental payment(s)
under such Schedule. In no event shall any Advance Rental or any other rent
payments be refunded to Lessee. If rent is not paid within ten days of its due
date, Lessee agrees to pay a late charge of five cents ($.05) per dollar on,
and in addition to, the amount of such rent but not exceeding the lawful
maximum, if any.
(c) So long as no default shall have occurred and be continuing under
the terms of this agreement, neither Lessor nor its agents, employees,
creditors, or assigns will disturb Lessee's quiet, peaceful and uninterrupted
possession of the Equipment during the term of this Lease and Lessee's
uninterrupted use thereof for its intended purpose.
III. RENT ADJUSTMENT:
(a) The periodic rent payments in each Schedule have been calculated on
the assumption (which, as between Lessor and Lessee, is mutual) that the
maximum effective corporate income tax rate (including any surcharge but
exclusive of any minimum tax rate) for calendar year taxpayers ("Effective
Rate") will be thirty-five percent (35%) for each year of the lease term.
(b) If, solely as a result of Congressional enactment of any law
(including, without limitation, any modification of, or amendment or addition
to, the Internal Revenue Code of 1986 ("Code"), the Effective Rate is higher
than thirty-five percent (35%) for any year during the lease term, then Lessor
shall have the right to increase such rent payments by requiring payment of a
single additional sum equal to the product of (i) the Effective Rate
(expressed as a decimal) for such year less .35 (or, in the event that any
adjustment has been made hereunder for any previous year, the Effective Rate
(expressed as a decimal) used in calculating the next previous adjustment)
times (ii) the adjusted Stipulated Loss Value divided by the difference
between the new Effective Tax Rate (expressed as a decimal) and one (1). The
adjusted Stipulated Loss Value shall be the Stipulated Loss Value (calculated
as of the first rental due in the year for which such adjustment is being
made) less the product of the Tax Benefits that would be allowable under
Section 168 of the Code (as of the first day of the year for which such
adjustment is being made and all subsequent years of the lease term). Lessee
shall pay to Lessor the full amount of the additional rent payment on the
later of (i) receipt of notice or (ii) the first day of the year for which
such adjustment is being made.
(c) Lessee's obligations under this Section III shall survive any
expiration or termination of this Agreement.
IV. TAXES: Except as provided in Sections III and XV(c), Lessee shall
have no liability for taxes imposed by the United States of America or
any State or political subdivision thereof which are on or measured by
the net income of Lessor. Lessee shall report (to the extent that it is
legally permissible) any pay promptly all other taxes, fees and
assessments due, imposed, assessed or levied against any Equipment (or
the purchase, ownership, delivery, leasing, possession, use or operation
therof), this Agreement (or any rentals or receipts hereunder), any
Schedule, Lessor or Lessee by any foreign, federal, state or local
government or taxing authority during or related to the term of this
Agreement, including, without limitation, all license and registration
fees, and all sales, use, personal property, excise, gross receipts,
franchise, stamp or other taxes, imposts, duties and charges, together
with any penalties, fines or interest thereon (all hereinafter called
"Taxes"). Lessee shall (i) reimburse Lessor upon receipt of written
request for reimbursement for any Taxes charged to or assessed against
Lessor, (ii) on request of Lessor, submit to Lessor written evidence of
Lessee's payment of Taxes, (iii) on all reports or returns show the
ownership of the Equipment by Lessor, and (iv) send a copy thereof to
Lessor. The obligations of Lessee under this Section IV shall survive
any expiration or termination of this Agreement.
V. REPORTS:
(a) Lessee will notify Lessor in writing, within ten (10) days after any
tax or other lien shall attach to any Equipment, of the full particulars thereof
and of the location of such Equipment on the date of such notification.
(b) Lessee will within ninety (90) days of the close of each fiscal year
of Lessee, deliver to Lessor, Lessee's complete financial statements,
certified by a recognized firm of certified public accountants. Lessee will,
within thirty (30) days after the date on which they are filed, deliver to
Lessor all Forms 10-K and 10-Q filed with the Securities and Exchange
Commission. Upon request Lessee will deliver to Lessor quarterly, within
ninety (90) days of the close of each fiscal quarter of Lessee, in reasonable
detail, copies of Lessee's quarterly financial report certified by the chief
financial officer of Lessee. Upon request, Lessee will deliver to Lessor one
copy of each financial statement, report, notice or proxy statement sent by
Lessee to shareholders generally and one copy of each regular or periodic
report, registration statement or prospectus filed by Lessee with any
securities exchange or the Securities and Exchange Commission or any successor
agency, such copies to be delivered to Lessor within thirty (30) days after
they become available or are otherwise filed.
(c) Lessee will permit Lessor to inspect any Equipment during normal
business hours.
(d) Lessee will keep the Equipment at the Equipment Location (specified
in the applicable Schedule) and will give Lessor prior written notice of any
relocation of Equipment. Upon the written request of Lessor, Lessee will
notify Lessor forthwith in writing of the location of any Equipment as of the
date of such notification.
(e) Lessee will promptly and fully report to Lessor in writing if any
Equipment is lost or damaged (where the estimated repair costs would exceed ten
percent (10%) of its then fair market value), or is otherwise involved in an
accident causing personal injury or property damage.
(f) Within thirty (30) days after any request by Lessor, Lessee will
furnish a certificate of an authorized officer of Lessee stating that he has
reviewed the activities of Lessee and that, to the best of his knowledge,
there exists no default (as described in Section XII) or event which with
notice or lapse of time (or both) would become such a default.
VI. DELIVERY, USE AND OPERATION:
(a) All Equipment shall be shipped directly from the Supplier to Lessee.
(b) Lessee agrees that the Equipment will be used by Lessee solely in the
conduct of its business and in a manner complying with all applicable federal,
state, and local laws and regulations and any applicable insurance policies
and Lessee shall not discontinue use of the Equipment.
(c) LESSEE SHALL NOT ASSIGN, MORTGAGE, SUBLET OR HYPOTHECATE ANY
EQUIPMENT, OR THE INTEREST OF LESSEE HEREUNDER, NOR SHALL LESSEE REMOVE ANY
EQUIPMENT FROM THE CONTINENTAL UNITED STATES, WITHOUT THE PRIOR WRITTEN
CONSENT OF THE LESSOR.
(d) Lessee will keep the Equipment free and clear of all liens and
encumbrances other than those which result from acts of Lessor.
VII. SERVICE:
(a) Lessee will, at its sole expense, maintain each unit of Equipment in
good operating order, repair, condition and appearance in accordance with
manufacturer's recommendations, normal wear and tear expected. Lessee shall,
if at any time requested by Lessor, affix in a prominent position on each
unit of Equipment plates, tags or other identifying labels showing ownership
thereof by Lessor.
(b) Lessee will not, without the prior consent of Lessor, affix or
install any accessory, equipment or device on any Equipment if such addition
will impair the originally intended function or use of such Equipment. All
additions, repairs, parts, supplies, accessories, equipment, and devices
furnished, attached or affixed to any Equipment which are not readily
removable shall be made only in compliance with applicable law, including
Internal Revenue Service guidelines, shall be free and clear of all liens,
encumbrances or rights of others, and shall become the property of Lessor.
Lessee will not, without the prior written consent of Lessor and subject to
such conditions as Lessor may impose for its protection, affix or install any
Equipment to or in any other personal or real property.
(c) Any alterations or modifications to the Equipment that may, at any
time during the term of this Agreement, be required to comply with any
applicable law, rule or regulation shall be made at the expense of Lessee.
VIII. STIPULATED LOSS VALUE: Lessee shall promptly and fully notify
Lessor in writing if any unit of Equipment shall be or become worn out,
lost, stolen, destroyed, irreparably damaged in the reasonable
determination of Lessee, or permanently rendered unfit for use from any
cause whatsoever (such occurrences being hereinafter called "Casualty
Occurrences"). On the rental payment date next succeeding a Casualty
Occurrence (the "Payment Date"), Lessee shall pay Lessor the sum of (x)
the Stipulated Loss Value of such unit calculated as of the rental next
preceding such Casualty Occurrence ("Calculation Date") and (y) all
rentals and other amounts which are due hereunder as of the Payment
Date. Upon payment of all sums due hereunder, the term of this lease as
to such unit shall terminate and (except in the case of the loss, theft
or complete destruction of such unit) Lessor shall be entitled to
recover possession of such unit.
IX. LOSS OR DAMAGE: Lessee hereby assumes and shall bear the entire risk
of any loss, theft, damage to, or destruction of, any unit of Equipment
from any cause whatsoever from the time the Equipment is shipped to
Lessee.
X. INSURANCE: Lessee agrees, at its own expense, to keep all Equipment
insured for such amounts and against such hazards as Lessor may require,
including, but not limited to, insurance for damage to or loss of such
Equipment and liability coverage for personal injuries, death or property
damage, with Lessor named as additional insured and with a loss payable
clause in favor of Lessor, as its interest may appear, irrespective of any
breach of warranty or other act or omission of Lessee. All such policies
shall be with companies, and on terms, satisfactory Lessor. Lessor agrees to
deliver to Lessor evidence of insurance satisfactory to Lessor. No Insurance
shall be subject to any co-insurance clause. Lessee hereby appoints Lessor as
Lessees.
attorney-in-fact to make proof of loss and claim for insurance, and to make
adjustments with insurers and to receive payment of and execute or endorse all
documents, checks or drafts in connection with payments made as a result of
such insurance policies. Any expense of Lessor in adjusting or collecting
insurance shall be borne by Lessee. Lessee will not make adjustments with
insurers except (i) with respect to claims for damage to any unit of Equipment
where the repair costs do not exceed ten percent (10%) of such unit's fair
market value, or (ii) with Lessor's written consent. Said policies shall
provide that the insurance may not be altered or cancelled by the insurer
until after thirty (30) days' written notice to Lessor. Lessor may, at its
option, apply proceeds of insurance, in whole or in part, to (i) repair or
replace Equipment or any portion thereof, or (ii) satisfy any obligation of
Lessee to Lessor hereunder.
XI. RETURN OF EQUIPMENT:
(a) Upon any expiration or termination of this Agreement or any
Schedule, Lessee shall promptly, at its own cost and expense: (i)
perform any testing and repairs required to place the affected units of
Equipment in the same condition and appearance as when received by
Lessee (reasonable wear and tear excepted) and in good working order for
their originally intended purpose; (ii) if deinstallation, disassembly
or crating is required, cause such units to be deinstalled, disassembled
and crated by an authorized manufacturer's representative or such other
service person as is satisfactory to Lessor; and (iii) return such units
to a location within the continental United States as Lessor shall
direct.
(b) Until Lessee has fully complied with the requirements of Section
XI(a) above, Lessee's rent payment obligation and all other obligations
under this Agreement shall continue from month to month notwithstanding any
expiration or termination of the lease term. Lessor may terminate such
continued leasehold interest upon ten (10) days' notice to Lessee.
XII. DEFAULT:
(a) Lessor may in writing declare this Agreement in default if: Lessee
breaches its obligation to pay rent or any other sum when due and fails to
cure the breach within ten (10) days; Lessee breaches any of its insurance
obligations herewith under Section X; Lessee breaches any of its other
obligations hereunder and fails to cure that breach within xxxxxx (30) days
after written notice thereof; any representation or warranty made by or on
behalf of Lessee in connection with this Agreement shall be false or
misleading in any material respect; Lessee or any guarantor becomes insolvent
or ceases to do business as a going concern; any Equipment is illegally used;
a petition is filed by or against Lessee or any guarantor under any bankruptcy
or insolvency laws; there is a revocation or anticipatory repudiation of any
guarantor's obligations under any guaranty issued in connection with this
Agreement; Lessee or any guarantor shall be in default under any material
obligation and the applicable grace period with respect thereto shall have
expired; Lessee or any guarantor shall have terminated its existence,
consolidated with, merged into or conveyed or leased substantially all of its
assets as an entirety to any person (such actions being referred to as an
"Event"), unless not less than sixty (60) days prior to such Event: (x) such
person is organized and existing under the laws of the United States or any
state, and executes and delivers to Lessor an agreement containing an
effective assumption by such person of the due and punctual performance of
this Lease or guaranty thereof, as the case may be, and (y) Lessor is
reasonably satisfied as to the credit worthiness of such person; if Lessee or
any guarantor is a privately held corporation and effective control of
Lessee's or any guarantor's voting capital stock, issued and outstanding from
time to time, is not retained by the present stockholders (unless Lessee shall
have provided sixty (60) days' prior written notice to Lessor of the proposed
disposition of stock and Lessor shall have consented thereto in writing);
or if Lessee or any guarantor is a publicly held corporation as a result of or
in connection with a material change in the ownership of Lessee's or any
guarantor's capital stock, Lessee's or any guarantor's debt-to-worth ratio
equals or exceeds twice Lessee's or any guarantor's debt-to-worth ratio as of
the date of this Lease (unless Lessor shall have given its prior written
consent thereto), if Lessee or any guarantor is a natural person, any death or
incompetency of Lessee or such guarantor. As used herein, "debt-to-worth
ratio" shall mean the ratio of (x) total liabilities which, in accordance with
generally accepted accounting principles ("GAAP") would be included in the
liability side of a balance sheet to (y) tangible net worth including the sum
of the par or stated value of all outstanding capital stock, surplus and
undivided profits, less any amounts attributable to goodwill, patents,
copyrights, mailing lists, catalogs, trademarks, bond discount and
underwriting expenses, organization expense and other intangibles, all
determined in accordance with GAAP. Any provision of this Agreement to the
contrary notwithstanding, Lessor may exercise all rights and remedies
hereunder independently with respect to each Schedule.
(b) After default, at the requrest of Lessor, Lessee shall comply with
the provisions of Section XI(a). Lessee hereby authorizes Lessor to enter,
with or without legal process, any premises where any Equipment is believed to
be and take possession thereof. Lessee shall, without further demand,
forthwith pay to Lessor as liquidated damages for loss of a bargain and not as
a penalty, the Stipulated Loss Value of the Equipment (calculated as of the
rental date next preceding the declaration of default), and all rentals and
other sums then due hereunder. Lessor may terminate this Agreement as to any
or all of the Equipment, provided that a termination shall occur only upon
written notice by Lessor to Lessee and only as to the items of Equipment
specified in any such notice. Lessor may, but shall not be required to, sell
Equipment at private or public sale, in bulk or in parcels, with or without
notice, and without having the Equipment present at the place of sale; or Lessor
may, but shall not be required to, lease, otherwise dispose of or keep idle all
or part of the Equipment; and Lessor may use Lessee's premises for any or all of
the foregoing without liability for rent, costs, damages or otherwise. The
proceeds of sale, lease or other disposition, if any, shall be applied in the
following order of priorities: (1) to pay all of Lessor's costs, charges and
expenses incurred in taking, removing, holding, repairing and selling, leasing
or otherwise disposing of Equipment; then, (2) to the extent not previously paid
by Lessee, to pay Lessor all sums due from Lessee hereunder; then (3) to
reimburse to Lessee any sums previously paid by Lessee as liquidated damages;
and (4) any surplus shall be retained by Lessor. Lessee shall pay any deficiency
in (1) and (2) forthwith.
(c) The foregoing remedies are cumulative, and any or all thereof may be
exercised in lieu of or in addition to each other or any remedies at law, in
equity, or under statute. Lessee waives notice of sale or other disposition
(and the time and place thereof), and the manner and place of any advertising.
Lessee shall pay Lessor's actual attorney's fees incurred in connection with
the enforcement, assertion, defense or preservation of Lessor's rights and
remedies hereunder, or if prohibited by law, such lesser sum as may be
permitted. Waiver of any default shall be a waiver of any other or subsequent
default.
(d) Any default under the terms of this or any other agreement between
Lessor and Lessee may be declared by Lessor a default under this and any such
other agreement.
XIII. ASSIGNMENT: Lessor may, without the consent of Lessee, assign this
Agreement or any Schedule or any interests therein. Lessee agrees that if
Lessee receives written notice of an assignment from Lessor, Lessee will pay
all rent and all other amounts payable under any assigned Equipment Schedule
to such assignee or as instructed by Lessor. Lessee further agrees to confirm
in writing receipt of the notice of assignment as may be reasonably requested
by assignee. Lessee hereby waives and agrees not to assert against any such
assignee any defense, set-off, recoupment, claim or counterclaim which Lessee
has or may at any time have against Lessor for any reason whatsoever.
XIV. NET LEASE; NO SET-OFF, ETC: This Agreement is a net lease. Lessee's
obligation to pay rent and other amounts due hereunder shall be absolute and
unconditional. Lessee shall not be entitled to any abatement or reductions of,
or set-offs against, said rent or other amounts, including, without
limitation, those arising or allegedly arising out of claims (present or
future, alleged or actual, and including claims arising out of strict tort or
negligence of Lessor) of Lessee against Lessor under this Agreement or
otherwise. Nor shall this Agreement terminate or the obligations of Lessee be
affected by reason of any defect in or damage to, or loss of possession, use
or destruction of, any Equipment from whatsoever cause. It is the intention of
the parties that rents and other amounts due hereunder shall continue to be
payable in all events in the manner and at the times set forth herein unless
the obligation to do so shall have been terminated pursuant to the express
terms hereof.
XV. INDEMNIFICATION:
(a) Lessee hereby agrees to indemnify, save and keep harmless Lessor,
its agents, employees, successors and assigns from and against any and all
losses, damages, penalties, injuries, claims, actions and suits, including
legal expenses, of whatsoever kind and nature, in contract or tort or
otherwise, unless caused by the gross negligence or willful misconduct of
Lessor, and including, but not limited to, Lessor's strict liability in tort,
arising out of (i) the selection, manufacture, purchase, acceptance or
rejection of Equipment, the ownership of Equipment during the term of this
Agreement, and the delivery, lease, possession, maintenance, uses, condition,
return or operation of Equipment (including, without limitation, latent and
other defects, whether or not discoverable by Lessor or Lessee and any claim
for patent, trademark or copyright infringement or environmental damage) or
(ii) the condition of Equipment sold or disposed of after use by Lessee, any
sublessee or employees of Lessee. Lessee shall, upon request, defend any
actions based on, or arising out of, any of the foregoing.
(b) The Lease has been entered into on the assumption that (i) the Lease
will be treated for federal income tax purposes as a true lease and the Lessor
will be treated as the owner and lessor of the Equipment and the Lessee will
be treated as the lessee of the Equipment, and (ii) on the Lease Commencement
Date for any unit of Equipment, such unit will qualify for all of the items of
deduction and credit specified in Section C of applicable Schedule ("Tax
Benefits") in the hands of Lessor (all references to Lessor in this Section XV
include Lessor and the consolidated tax payer group of which Lessor is a
member).
(c) If for any reason whatsoever (i) tax counsel of Lessor shall
determine that Lessor is not entitled to claim on its federal income tax
return all or any portion of the Tax Benefits with respect to any Equipment or
(ii) any such Tax Benefit claimed on the federal income tax return of Lessor
is disallowed or adjusted by the Internal Revenue Service or (iii) any such
Tax Benefit is recomputed or recaptured (any such determination, disallowance,
adjustment, recomputation, or recapture being hereinafter called a "Loss"),
then Lessee shall pay to Lessor, as an indemnity and as additional rent, such
amount as shall, in the reasonable opinion of Lessor, cause Lessor's after-tax
economic yields and cash flows, computed on the same assumptions, including
tax rates (unless any adjustment has been made under Section III hereof, in
which case the Effective Rate used in the next preceding adjustment shall be
substituted), as were utilized by Lessor in originally evaluating the
transaction (such yields and flows being hereinafter called the "Net Economic
Return") to equal the Net Economic Return that would have been realized by
Lessor if such Loss had not occurred. Such amount shall be payable upon demand
accompanied by a statement describing in reasonable detail such Loss and the
computation of such amount. Anything in this paragraph to the contrary
notwithstanding, Lessee shall have no obligation to indemnify Lessor from or
against any such Loss to the extent that such Loss is caused by: (i) any
failure by Lessor to properly or timely claim on its federal income tax return
any Tax Benefits on any Equipment (unless such failure is based upon a
determination by tax counsel of Lessor that Lessor is not entitled to claim
such Tax Benefits with respect to such Equipment); (ii) any failure of Lessor
to have sufficient taxable income to benefit from the Tax Benefits; (iii) any
liability of the Lessor for any alternative minimum taxes; (iv) the status of
Lessor for purposes of federal income taxes; (v) any sale or other disposition
of any Equipment by Lessor other than after an event of default by Lessee;
(vi) any tax election made or not made by Lessor relating to the Tax Benefits;
or (vii) any event which results in a payment by Lessee in an amount equal to,
or measured by, the Stipulated Loss Value to the extent that such Loss was
included in Lessor's calculation of such Stipulated Loss Value.
(d) all of Lessor's rights, privileges and indemnities contained in this
Section XV shall survive the expiration or other termination of this
Agreement and the rights, privileges and indemnities contained herein are
expressly made for the benefit of, and shall be enforceable by Lessor, its
successors and assigns.
XVI. DISCLAIMER: LESSEE ACKNOWLEDGES THAT IT HAS SELECTED THE EQUIPMENT WITHOUT
ANY ASSISTANCE FROM LESSOR, ITS AGENTS OR EMPLOYEES. LESSOR DOES NOT MAKE, HAS
NOT MADE, NOR SHALL LESSOR BE DEEMED TO MAKE OR HAVE MADE, ANY WARRANTY OR
REPRESENTATION, EITHER EXPRESS OR IMPLIED, WRITTEN OR ORAL, WITH RESPECT TO THE
EQUIPMENT LEASED HEREUNDER OR ANY COMPONENT THEREOF, INCLUDING, WITHOUT
LIMITATION, ANY WARRANTY AS TO DESIGN, COMPLIANCE WITH SPECIFICATIONS, QUALITY
OF MATERIALS OR WORKMANSHIP, MERCHANTABILITY, FITNESS FOR ANY PURPOSE, USE OR
OPERATION, SAFETY, PATENT, TRADEMARK OR COPYRIGHT INFRINGEMENT, OR TITLE. All
such risks as between Lessor and Lessee, are to be borne by Lessee. Without
limiting the foregoing, Lessor shall have no responsibility or liability to
lessee or any other person with respect to any of the following, regardless of
any negligence of Lessor (i) any liability, loss or damage caused or alleged to
be caused directly or indirectly by any Equipment, any inadequacy thereof, any
deficiency or defect (latent or otherwise) therein, or any other circumstance in
connection therewith; (ii) the use, operation or performance of any Equipment or
any risks relating thereto; (iii) any interruption of service, loss of business
or anticipated profits or consequential damages, or (iv) the delivery,
operation, servicing, maintenance, repair, improvement or replacement of any
Equipment. If, and so long as, no default exists under this Lease, Lessee shall
be, and hereby is, authorized during the term of this Lease to assert and
enforce, at Lessee's sole cost and expense, from time to time, in the name of
and for the account of Lessor and/or Lessee, as their interests may appear,
whatever claims and rights Lessor may have against any Supplier of the
Equipment.
XVII. REPRESENTATIONS AND WARRANTIES OF LESSEE: Lessee hereby represents and
warrants to Lessor that on the date hereof and on the date of execution of
each Schedule:
(a) Lessee has adequate power and capacity to enter into, and perform
under, this Agreement and all related documents (together, the "Documents")
and is duly qualified to do business wherever necessary to carry on its present
business and operations, including the jurisdiction(s) where the Equipment is
or is to be located:
(b) The Documents have been duly authorized, executed and delivered by
Lessee and constitute valid, legal and binding agreements, enforceable in
accordance with their terms, except to the extent that the enforcement of
remedies therein provided may be limited under applicable bankruptcy and
insolvency laws.
(c) No approval, consent or withholding of objections is required from
any governmental authority or instrumentality with respect to the entry into
or performance by Lessee of the Documents except such as have already been.
(d) The entry into and performance by Lessee of the Documents will not:
(i) violate any judgment, order, law or regulation applicable to Lessee or any
provision of Lessee's Certificate of Incorporation or By-Laws; or (ii) result
in any breach of, constitute a default under or result in the creation of any
lien, charge, security interest or other encumbrance upon any Equipment
pursuant to any indenture, mortgage, deed of trust, bank loan or credit
agreement or other instrument (other than this Agreement) to which Lessee is a
party.
(e) There are no suits or proceedings pending or threatened in court or
before any commission, board or other administrative agency against or
affecting Lessee, which if decided adversely will have a material adverse
effect on the ability of Lessee to fulfill its obligations under this
Agreement.
(f) The Equipment accepted under any Certificate of Acceptance is and
will remain tangible personal property.
(g) Each financial statement delivered to Lessor has been prepared in
accordance with GAAP consistently applied, and since the date of the most
recent such financing statement, there has been no material adverse change.
(h) Lessee is and will be at all times validly existing and in good
standing under the laws of the State of its incorporation (specified in the
first sentence of this Agreement).
(i) The Equipment will at all times be used for commercial or business
purposes.
XVIII. PURCHASE OPTION:
(a) So long as no default exists hereunder and the lease has not been
earlier terminated, Lessee may at lease expiration, upon at least one hundred
eighty (180) days' prior written notice to Lessor, purchase all (but not less
than all) of the Equipment in any Schedule on an AS IS, WHERE IS BASIS without
recourse to or warranty from Lessor, express or implied ("AS IS BASIS") for
cash equal to its then Fair Market Value (plus all applicable sales taxes).
(b) "Fair Market Value," shall mean the price which a willing buyer (who
is neither a lessee in possession nor a used equipment dealer) would pay for
the Equipment in an arm's-length transaction to a willing seller under no
compulsion to sell; provided, however, that in such determination: (i) the
Equipment shall be assumed to be in the condition in which it is required to
be maintained and returned under this Agreement; (ii) in the case of any
installed Equipment, that Equipment shall be valued on an installed basis; and
(iii) costs of removal from current location shall not be a deduction from
such valuation. If Lessor and Lessee are unable to agree on the Fair Market
Value at least one hundred thirty-five (135) days before lease expiration,
Lessor shall appoint an independent appraiser (reasonably acceptable to
Lessee) to determine Fair Market Value, and that determination shall be final,
binding and conclusive. Lessee shall bear all costs associated with any such
appraisal.
(c) Lessee shall be deemed to have waived this option unless it provides
Lessor with written notice of its irrevocable election to exercise the same
within fifteen (15) days after Fair Market Value is determined (by agreement
or appraisal).
XIX. MISCELLANEOUS:
(A) LESSEE HEREBY UNCONDITIONALLY WAIVES IT RIGHTS TO A JURY TRIAL OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR
INDIRECTLY, THIS LEASE, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS BETWEEN
LESSEE AND LESSOR RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION OR ANY
RELATED TRANSACTIONS, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED
BETWEEN LESSEE AND LESSOR. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL
ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT
(INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW AND STAUTORY CLAIMS). THIS WAIVER IS
IRREVOCABLE MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING,
AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS
OR MODIFICATIONS TO THIS LEASE, ANY RELATED DOCUMENTS, OR TO ANY OTHER
DOCUMENTS OR AGREEMENTS RELATING TO THIS TRANSACTION OR ANY RELATED
TRANSACTION. IN THE EVENT OF LITIGATION, THIS LEASE MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
(b) Unless and until Lessee exercises its rights under Section XVIII
above, nothing herein contained shall give or convey to Lessee any right,
title or interest in and to any Equipment except as a lessee. Any cancellation
or termination by Lessor, pursuant to the provision of this Agreement, any
Schedule, supplement or amendment hereto, or the lease of any Equipment
hereunder, shall not release Lessee from any then oustanding obligations to
Lessor hereunder. All Equipment shall at all times remain personal property of
Lessor regardless of the degree of its annexation to any real property and
shall not by reason of any installation in, or affixation to, real or personal
property become a part thereof.
(c) Time is of the essence of this Agreement. Lessor's failure at any
time to require strict performance by Lessee of any of the provisions hereof
shall not waive or diminish Lessor's right thereafter to demand strict
compliance therewith. Lessee agrees, upon Lessor's request, to execute any
instrument necessary or expedient for filing, recording or perfecting the
interest of Lessor. All notices required to be given hereunder shall be deemed
adequately given if sent by registered or certified mail to the addressee at
its address stated herein, or at such other place as such addressee may have
designated in writing and shall be deemed effective when sent. This Agreement
and any Schedule and Annexes thereto constitute the entire agreement of the
parties with respect to the subject matter hereof. NO VARIATION OR
MODIFICATION OF THIS AGREEMENT OR ANY WAIVER OF ANY OF ITS PROVISIONS OR
CONDITIONS, SHALL BE VALID UNLESS IN WRITING AND SIGNED BY AN AUTHORIZED
REPRESENTATIVE OF THE PARTIES HERETO.
LESSOR /s/ SMS
LESSEE /s/ BTS
(d) In case of a failure of Lessee to comply with any provision of this
Agreement, Lessor shall have the right, but shall not be obligated to, effect
such compliance, in whole or in part; and all moneys spent and expenses and
obligations incurred or assumed by Lessor in effecting such compliance shall
constitute additional rent due to Lessor within five days after the date
Lessor sends notice to Lessee requesting payment. Lessor's effecting such
compliance shall not be a waiver of Lessee's default.
(e) Any rent or other amount not paid to Lessor when due hereunder shall
bear interest, both before and after any judgment or termination hereof, at
the lesser of eighteen percent (18%) per annum or the maximum rate allowed by
law. Any provisions in this Agreement and any Schedule which are in conflict
with any statute, law or applicable rule shall be deemed omitted, modified or
altered to conform thereto.
IN WITNESS WHEREOF, Lessee and Lessor have caused this Agreement to be
executed by their duly authorized representatives as of the date first
above written.
LESSOR: LESSEE:
General Electric Capital Corporation Applied Microbiology, Inc.
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxxx Name: Xxxxxxxx X. Xxxxx
Title: Senior Credit Analyst Title: Vice President Legal & Secretary
XXXX XXX XXXXXX
Notary Public, State of New York
No. 00-0000000
Qualified in Westchester County
Commission Expires 2/28/1996
