Exhibit 10.51
MASTER LEASE AGREEMENT
dated as of April 30, 1999 ("Agreement")
THIS AGREEMENT, is between General Electric Capital Corporation (together
with its successors and assigns, if any, "Lessor") and ACT Manufacturing, Inc.
("Lessee"). Lessor has an office at 00 Xxx Xxxxxxxxx Xxxx, Xxxxxxx, XX 00000-
5105. Lessee is a corporation organized and existing under the laws of the
State of Massachusetts. Lessee's mailing address and chief place of business is
000 Xxxxxx Xxxxxx, Xxxxxx, XX 00000. This Agreement contains the general terms
that apply to the leasing of Equipment from Lessor to Lessee. Additional terms
that apply to the Equipment (term, rent, options, etc.) shall be contained on a
schedule ("Schedule").
1. LEASING:
(a) Lessor agrees to lease to Lessee, and Lessee agrees to lease from
Lessor, the equipment ("Equipment") described in any Schedule signed by both
parties.
(b) Lessor shall purchase Equipment from the manufacturer or supplier
("Supplier") and lease it to Lessee if on or before the Last Delivery Date
Lessor receives (i) a Schedule for the Equipment, (ii) evidence of insurance
which complies with the requirements of Section 9, and (iii) such other
documents as Lessor may reasonably request. Each of the documents required
above must be in form and substance satisfactory to Lessor. Lessor hereby
appoints Lessee its agent for inspection and acceptance of the Equipment from
the Supplier. Once the Schedule is signed, the Lessee may not cancel the
Schedule.
2. TERM, RENT AND PAYMENT:
(a) The rent payable for the Equipment and Lessee's right to use the
Equipment shall begin on the earlier of (i) the date when the Lessee signs the
Schedule and accepts the Equipment or (ii) when Lessee has accepted the
Equipment under a Certificate of Acceptance ("Lease Commencement Date"). The
term of this Agreement shall be the period specified in the applicable Schedule.
The word "term" shall include all basic and any renewal terms.
(b) Lessee shall pay rent to Lessor at its address stated above,
except as otherwise directed by Lessor. Rent payments shall be in the amount
set forth in, and due as stated in the applicable Schedule. If any Advance Rent
(as stated in the Schedule) is payable, it shall be due when the Lessee signs
the Schedule. Advance Rent shall be applied to the first rent payment and the
balance, if any, to the final rent payment(s) under such Schedule. In no event
shall any Advance Rent or any other rent payments be refunded to Lessee. If
rent is not paid within ten (10) 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.
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3. 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 (exclusive of any minimum tax rate)
for calendar-year taxpayers ("Effective Rate") will be thirty-five percent (35%)
in 1995 and each year thereafter.
(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 for 1995 or
any subsequent year during the lease term is (i) increased above 35%, (ii)
further increased, or (iii) increased after any decrease, 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 Termination Value divided by the difference between the new Effective
Tax Rate (expressed as a decimal) and one (1). The adjusted Termination Value
shall be the Termination 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) times the Effective Rate (expressed as a decimal) (in the
year for which such adjustment is being made). 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) 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 for 1995 or
any subsequent year during the lease term is (i) decrease below 35%, (ii)
further decreased, or (iii) decreased after any increase, then Lessee shall have
the right to request, upon written notice, Lessor to pay Lessee, as a rental
rebate, a single additional sum equal to the product of (i) .35 (or, in the
event that any adjustment has been made under Section II for any previous year,
the Effective Rate (expressed as a decimal) used in calculating the next
previous adjustment) less the Effective Rate (expressed as a decimal) for such
year times (ii) the adjusted Termination Value divided by the difference between
the new Effective Tax Rate (expressed as a decimal) and one (1) (as defined
hereinabove). Lessor shall pay to Lessee the full amount of any such rental
rebate on the later of (i) receipt of Lessee's notice or (ii) the first day of
the year for which such adjustment is being made.
(d) Lessee's obligation under this Section III shall survive any
expiration or termination of this Agreement.
4. TAXES: If permitted by law, Lessee shall report and pay promptly all
taxes, fees and assessments due, imposed or levied against any Equipment (or
purchase, ownership delivery, leasing, possession, use or operation thereof),
this Agreement (or any rents or receipts hereunder), any Schedule, Lessor or
Lessee by any governmental entity 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
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other taxes, imposts, duties and charges, together with any penalties, fines or
interest thereon (collectively "Taxes"). 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 except
as provided in Section 3 and 14(c). Lessee shall promptly reimburse Lessor (on
or after tax basis) for any Taxes charged to or assessed against Lessor. Lessee
shall show Lessor as the owner of the Equipment on all tax reports or returns,
and send Lessor a copy of each report or return and evidence of Lessee's payment
of Taxes upon request.
5. REPORTS:
(a) If any tax or other lien, which results from the acts of Lessee
shall attach to any Equipment, Lessee will notify Lessor in writing, within ten
(10) days after Lessee becomes aware of the tax or lien. The notice shall
include the full particulars of the tax or lien and the location of such
Equipment on the date of the notice.
(b) Lessee will deliver to Lessor, Lessee's complete financial
statements, certified by a recognized firm of certified public accountants
within ninety (90) days of the close of each fiscal year of Lessee. Lessee will
deliver to Lessor copies of Lessee's quarterly financial report certified by the
chief financial officer of Lessee, within ninety (90) days of the close of each
fiscal quarter of Lessee. Lessee will deliver to Lessor all Forms 10-K and 10-
Q, if any, filed with the Securities and Exchange Commission within thirty (30)
days after the date on which they are filed.
(c) Lessor may inspect any Equipment during normal business hours
after giving Lessee reasonable prior notice.
(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. If Lessor asks, Lessee will promptly notify
Lessor in writing of the location of any Equipment.
(e) If any Equipment is lost or damaged (where the estimated repair
costs would exceed the greater of ten percent (10%) of the original Equipment
cost or ten thousand and 00/100 dollars ($10,000)), or is otherwise involved in
an accident causing personal injury or property damage, Lessee will promptly and
fully report the event to Lessor in writing.
(f) Lessee will furnish a certificate of an authorized officer of
Lessor stating that he has reviewed the activities of Lessee and that, to the
best of his knowledge, there exists no default or event which with notice or
lapse of time (or both) would become such a default within thirty (30) days
after any request by Lessor.
6. 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 laws,
regulations and insurance policies and Lessee shall not discontinue use of the
Equipment.
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(c) Lessee will not move any equipment from the location specified on
the Schedule, without the prior written consent of Lessor.
(d) Lessee will keep the Equipment free and clear of all liens and
encumbrances other than those which result from acts of Lessor.
(e) Lessor shall not disturb Lessee's quiet enjoyment of the Equipment
during the term of the Agreement unless a default has occurred and is continuing
under this Agreement.
7. MAINTENANCE:
(a) Lessee will, at its sole expense, maintain each unit of Equipment
in good operating order and repair, normal wear and tear excepted. The Lessee
shall also maintain the Equipment in accordance with manufacturer's
recommendations. Lessee shall make all alterations or modifications required to
comply with any applicable law, rule or regulation during the term of this
Agreement. If Lessor requests, Lessee shall affix plates, tags or other
identifying labels showing ownership thereof by Lessor. The tags or labels
shall be placed in a prominent position on each unit of Equipment.
(b) Lessee will not attach or install anything on any Equipment that
will impair the originally intended function or use of such Equipment without
the prior written consent of Lessor. All additions, parts, supplies,
accessories, and equipment ("Additions") furnished or attached to any Equipment
that are not readily removable shall become the property of Lessor. All
Additions shall be made only in compliance with applicable law. Lessee will not
attach or install any Equipment to or in any other personal or real property
without the prior written consent of Lessor.
8. STIPULATED LOSS VALUE: If for any reason any unit of Equipment becomes
worn out, lost, stolen, destroyed, irreparably damaged or unusable ("Casualty
Occurrences") Lessee shall promptly and fully notify Lessor in writing. Lessee
shall pay Lessor the sum of (i) the Stipulated Loss value (see Schedule) or the
affected unit determined as of the rent payment date prior to the Casualty
Occurrence; and (ii) all rent and other amounts which are then due under this
Agreement on the Payment Date (defined below) for the affected unit. The Payment
Date shall be the next rent payment date after the Casualty Occurrence. Upon
Payment of all sums due hereunder, the term of this Lease as to such unit shall
terminate.
9. INSURANCE:
(a) Lessee 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.
(b) Lessee agrees, at its own expense, to keep all Equipment insured
for such amounts and against such hazards as Lessor may reasonably require. All
such policies shall be with companies, and on terms, reasonably satisfactory to
Lessor. The insurance shall include coverage for damage to or loss of the
Equipment, liability for personal injuries, death or property damage. Lessor
shall be named as additional insured 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
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of Lessee. The insurance shall provide for liability coverage in an amount equal
to at least ONE MILLION U.S. DOLLARS ($1,000,000.00) total liability per
occurrence, unless otherwise stated in any Schedule. The casualty/property
damage coverage shall be in an amount equal to the higher of the Stipulated Loss
Value or the full replacement cost of the Equipment. No insurance shall be
subject to any co-insurance clause. The insurance policies shall provide that
the insurance may not be altered or canceled by the insurer until after thirty
(30) days written notice to Lessor. Lessee agrees to deliver to Lessor evidence
of insurance reasonably satisfactory to Lessor.
(c) Lessee hereby appoints Lessor as Lessee's attorney-in-fact to make
proof of loss and claim for insurance, and to make adjustments with insurers and
to receive payment of an execute or endorse all documents, checks or drafts in
connection with insurance payments. Lessor shall not act as Lessee'' attorney-
in-fact unless Lessee is in default. Lessee shall pay any reasonable expenses
of Lessor in adjusting or collecting insurance. Lessee will not make
adjustments with insurers except with respect to claims for damage to any unit
of Equipment where the repair costs are less than the lesser of ten percent
(10%) of the original Equipment cost or ten thousand and 00/100 dollars
($10,000). 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 under this Agreement.
10. RETURN OF EQUIPMENT:
(a) At the expiration or termination of this Agreement or any
Schedule, Lessee shall perform any testing and repairs required to place the
units of Equipment in the same condition and appearance as when received by
lessee (reasonable wear and tear excepted) and in good working order for the
original intended purpose of the Equipment. If required the units of Equipment
shall be deinstalled, disassembled and crated by an authorized manufacturer's
representative or such other service person as is reasonably satisfactory to
Lessor. Lessee shall remove installed markings that are not necessary for the
operation, maintenance or repair of the Equipment. All Equipment will be
cleaned, cosmetically acceptable, and in such condition as to be immediately
installed into use in a similar environment for which the Equipment was
originally intended to be used. All waste material and fluid must be removed
from the Equipment and disposed of in accordance with then current waste
disposal laws. Lessee shall return the units of Equipment to a location within
the continental United States as Lessor shall direct. Lessee shall obtain and
pay for a policy of transmit insurance for the redelivery period in an amount
equal to the replacement value of the Equipment. The transit insurance must
name Lessor as the loss payee. The Lessee shall pay for all costs to comply
with this section (a).
(b) Until Lessee has fully complied with the requirements of Section
10(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 the Lessee's right to
use the Equipment upon ten (10) days notice to Lessee.
(c) Lessee shall provide to Lessor a detailed inventory of all
components of the Equipment including model and serial numbers. Lessee shall
also provide an up-to-date copy of all other documentation pertaining to the
Equipment. All service manuals, blueprints, process
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of flow diagrams, operating manuals, inventory and maintenance records shall be
given to Lessor at least ninety (90) days and not more than one hundred twenty
(120) days prior to lease termination.
(d) Lessee shall make the Equipment available for on-site operational
inspections by potential purchasers at least one hundred twenty (120) days prior
to and continuing up to lease termination. Lessor shall provide Lessee with
reasonable notice prior to any inspection. Lessee shall provide personnel,
power and other requirements necessary to demonstrate electrical, hydraulic and
mechanical systems for each item of Equipment.
11. DEFAULT AND REMEDIES:
(a) Lessor may in writing declare this Agreement in default if:
(i)Lessee breaches its obligation to pay rent or other sum when due and fails to
cure the breach within ten (10) days; (ii) Lessee breaches any of its insurance
obligations under Section 9; (iii) Lessee breaches any of its other obligations
and fails to cure that breach within thirty (30) days after written notice from
Lessor; (iv) any representation or warranty made by Lessee in connection with
this Agreement shall be false or misleading in any material respect when made;
(v) Lessee or any guarantor or other obligor for the Lessee's obligations
hereunder ("Guarantor") becomes insolvent or ceases to do business as a going
concern; (vi) any Equipment is illegally used; (vii) if Lessee or any Guarantor
is a natural person, any death or incompetency of Lessee or such Guarantor; or
(viii) a petition is filed by or against Lessee or any Guarantor under any
bankruptcy or insolvency laws and in the event of an involuntary petition, the
petition is not dismissed within forty-five (45) days of the filing date. The
default declaration shall apply to all Schedules unless specifically excepted by
Lessor.
(b) After a default has occurred and is continuing: at the request of
Lessor, Lessee shall comply with the provisions of Section 10(a). Lessee hereby
authorizes Lessor to peacefully enter any premises where any Equipment may be
and take possession of the Equipment. Lessee shall immediately pay to Lessor
without further demand as liquidated damages for loss of a bargain and not as a
penalty, the Stipulated Loss Value of the Equipment (calculated as of the rent
payment date prior to the declaration of default), and all rents and other sums
then due under this Agreement and all Schedules. Lessor may terminate this
Agreement as to any or all of the Equipment. A termination shall occur only
upon written notice by Lessor to Lessee and only as to the units 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. Lessor
may also, but shall not be required to, lease, otherwise dispose of or keep idle
all or part of the Equipment. Lessor may use Lessee's premises for a reasonable
period of time for any or all of the purposes stated above 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 or priorities: (i)
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, (ii) to the extent not previously paid by Lessee, to pay Lessor all sums
due from Lessee under this Agreement; then, (iii) to reimburse to Lessee any
sums previously paid by Lessee as liquidated damages; and (iv) any surplus shall
be retained by Lessor. Lessee shall immediately pay any deficiency in (i) and
(ii) above.
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(c) The foregoing remedies are cumulative, and any or all thereof may
be exercised instead 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
under this Agreement, if prohibited by law, such lesser sum as may be permitted.
Waiver of any default shall not 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.
12. ASSIGNMENT: LESSEE SHALL NOT SELL, TRANSFER, ASSIGN, ENCUMBER OR
SUBLET ANY EQUIPMENT OR THE INTEREST OF LESSEE IN THE EQUIPMENT WITHOUT THE
PRIOR WRITTEN CONSENT OF LESSOR. Lessor may, without the consent of Lessee,
assign this Agreement, any Schedule or the right to enter into a Schedule.
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 Schedule to such assignee or, as instructed by Lessor. Lessee also
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 asset
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.
13. NET LEASE: Lessee is unconditionally obligated to pay all rent and
other amounts due for the entire lease term no matter what happens, even if the
Equipment is damaged or destroyed, if it is defective or if Lessee no longer can
use it. Lessee is not entitled to reduce or set-off against rent or other
amounts due to Lessor or to anyone to whom Lessor assigns this Agreement or any
Schedule whether Lessee's claim arises out of this Agreement, any Schedule, any
statement by Lessor, Lessor's liability or any manufacturer's liability, strict
liability, negligence or otherwise.
14. INDEMNIFICATION:
(a) Lessee hereby agrees to indemnify Lessor, its agents, employees,
successors and assigns (on or after tax basis) from and against any and all
losses, damages, penalties, injuries, claims, actions, and suits, including
legal expenses, of whatsoever kind and nature arising out of or relating to the
Equipment or this Agreement, except to the extent the losses, damages,
penalties, injuries, claims, actions, suits or expenses result from Lessor's
gross negligence or willful misconduct ("Claims"). This indemnity shall
include, but is not limited to, Lessor's strict liability in tort and Claims,
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 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.
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(b) Lessee hereby represents, warrants and covenants that (i) 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 the
applicable Schedule ("Tax Benefits") in the hands of Lessor, and (ii) at no time
during the term of this Agreement will Lessee take or omit to take, nor will it
permit any sublessee or assignee to take or omit to take, any action (whether or
not such act or omission is otherwise permitted by Lessor or by this Agreement,)
which will result in the disqualification of any Equipment for, or recapture of,
all or any portion of such Tax Benefits.
(c) If as a result of a breach of any representation, warranty or
covenant of the Lessee contained in this Agreement or any Schedule (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 Tax Benefit claimed on the Federal income tax return
of Lessor is disallowed or adjusted by the Internal Revenue Service, or (iii)
any Tax Benefit is recalculated or recaptured (any determination, disallowance,
adjustment, recalculation or recapture being a "Loss"), then Lessee shall pay to
Lessor, as an indemnity and as additional rent, an amount that shall, in the
reasonable opinion of Lessor, cause Lessor's after-tax economic yields and cash
flows 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. The economic yields and cash flows shall be
computed on the same assumptions, including tax rates as were used by Lessor in
originally evaluating the transaction ("Net Economic Return"). If an adjustment
has been made under Section 3 then the Effective Rate used in the next preceding
adjustment shall be substituted.
(d) All references to Lessor in this Section 14 include Lessor and the
consolidated taxpayer group of which Lessor is a member. All of Lessor's
rights, privileges and indemnities contained in this Section 14 shall survive
the expiration or other termination of this Agreement. The rights, privileges
and indemnities contained herein are expressly made for the benefit of, and
shall be enforceable by Lessor, its successors and assigns.
15. 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 BE DEEMED TO MAKE OR HAVE MADE, ANY WARRANTY OR
REPRESENTATION, EITHER EXPRESS OR IMPLIED, WRITTEN OR ORAL, WITH RESPECT TO THIS
EQUIPMENT LEASED UNDER THIS AGREEMENT 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: (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) of the Equipment, or any other circumstance in connection with the
Equipment; (ii) the use, operation or performance of any Equipment or any risks
relating to it; (iii) any interruption of service, loss
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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 Agreement,
Lessee shall be, and hereby is, authorized during the term of this Agreement to
assert and enforce whatever claims and rights Lessor may have against any
Supplier of the Equipment at Lessee's sole cost and expense, in the name of and
for the account of Lessor and/or Lessee, as their interests may appear.
16. REPRESENTATIONS AND WARRANTIES OF LESSEE: Lessee makes each of the
following representations and warranties to Lessor 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").
Lessee 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 may be limited under applicable bankruptcy and insolvency laws or
general equity principals.
(c) No approval, consent or withholding of objections is required from
any governmental authority or entity with respect to the entry into or
performance by Lessee of the Documents except such as have already been
obtained.
(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 bylaws; 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 proceeding pending or threatened in court or
before any commission, board or other administrative agency against or affecting
Lessee, which if decided against Lessee, 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 generally accepted accounting principles consistently applied.
since the date of the most recent financial 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).
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(i) The Equipment will at all times be used for commercial or business
purposes.
17. EARLY TERMINATION
(a) On or after the First Termination Date (specified in the
applicable Schedule), Lessee may, so long as no default exists hereunder,
terminate this Agreement as to all (but not less than all) of the Equipment on
such Schedule as of a rent payment date ("Termination Date"). Lessee must give
Lessor at least ninety (90) days prior written notice of the termination.
(b) Lessee shall, and Lessor may, solicit cash bids for the Equipment
on an AS IS, WHERE IS BASIS without recourse to or warranty from Lessor, express
or implied ("AS IS BASIS"). Prior to the Termination Date, Lessee shall (i)
certify to Lessor any bids received by Lessee and (ii) pay to Lessor (A) the
Termination Value (calculated as of the rent due on the Termination Date) for
the Equipment, and (B) all rent and other sums due and unpaid as of the
Termination Date.
(c) If all amounts due hereunder have been paid on the Termination
Date, Lessor shall (i) sell the Equipment on an AS IS BASIS for cash to the
highest bidder and (ii) refund the proceeds of such sale (net of any related
expenses) to Lessee up to the amount of the Termination Value. If such sale is
not consummated, no termination shall occur and Lessor shall refund the
Termination Value (less any expenses incurred by Lessor) to Lessee.
(d) Notwithstanding the foregoing, Lessor may elect by written notice,
at any time prior to the Termination Date, not to sell the Equipment. In that
event, on the Termination Date Lessee shall (i) return the Equipment (in
accordance with Section 10) and (ii) pay to Lessor all amounts required under
Section 17(b) less the amount of the highest bid certified by Lessee to Lessor.
18. PURCHASE OPTION:
(a) Lessee may at lease expiration purchase all (but not less than
all) of the Equipment in any Schedule on an AS IS BASIS for cash equal to its
then Fair Market Value (plus all applicable sales taxes). Lessee must notify
Lessor of its intent to purchase the Equipment in writing at least one hundred
eighty (180) days in advance. If Lessee is in default or if the Lease has
already been terminated Lessee may not purchase the Equipment.
(b) "Fair Market Value" shall mean the price that 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. In determining the Fair Market Value the Equipment shall be assumed to
be in the condition in which it is required to be maintained and returned under
this Agreement. If the Equipment is installed it shall be valued on an
installed basis. The costs of removal from current location shall not be a
deduction from the value of the Equipment. 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. The
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independent appraiser's 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 sold to Lessee.
19. MISCELLANEOUS:
(a) LESSEE AND LESSOR UNCONDITIONALLY WAIVE THEIR RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AGREEMENT, 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. THIS WAIVER IS IRREVOCABLE. THIS
WAIVER MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING. THE WAIVER ALSO SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO
THIS AGREEMENT, ANY REALTED DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS
RELATING TO THIS TRANSACTION OR ANY RELATED TRANSACTION. THIS AGREEMENT MAY BE
FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
(b) The Equipment shall remain Lessor's property unless Lessee
purchases the Equipment from Lessor and until such time Lessee shall only have
the right to use the Equipment as a lessee. Any cancellation or termination by
Lessor of this Agreement, any Schedule, supplement or amendment hereto, or the
lease of any Equipment hereunder shall not release Lessee from any then
outstanding obligations to Lessor hereunder. all Equipment shall at all times
remain personal property of Lessor even though it may be attached to real
property. The Equipment shall not become part of any other property by reason
of any installation, in or attachment to, other real or personal property.
(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 at any other time to demand strict
compliance with this Agreement. 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 specified in writing. 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.
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(d) If Lessee does not 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. All reasonable amounts spent and obligations
incurred or assumed by Lessor in effecting such compliance shall constitute
additional rent due to Lessor. Lessee shall pay the additional rent 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 shall bear
interest, from the due date until paid, at the lesser of eighteen percent (18%)
per annum or the maximum rate allowed by law. Any provisions in this Agreement
and any Schedule that are in conflict with any statute, law or applicable rule
shall be deemed omitted, modified or altered to conform thereto.
(f) Lessee hereby irrevocably authorizes Lessor to adjust the
Capitalized Lessor's Cost up or down by no more than ten percent (10%) within
each Schedule to account for equipment change orders, equipment returns,
invoicing errors, and similar matters. Lessee acknowledges and agrees that the
rent shall be adjusted as a result of the change in the Capitalized Lessor's
Cost. Lessor shall send Lessee a written notice stating the final Capitalized
Lessor's Cost, if it has changed.
(g) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF CONNECTICUT (WITHOUT REGARD TO THE CONFLICT OF
LAWS PRINCIPLES OF SUCH STATE), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY
AND PERFORMANCE, REGARDLESS OF THE LOCATION OF THE EQUIPMENT.
(h) Any cancellation or termination by Lessor, pursuant to the
provisions of this Agreement, any Schedule, supplement or amendment hereto, of
the lease of any Equipment hereunder, shall not release Lessee from any then
outstanding obligations to Lessor hereunder.
(i) To the extent that any Schedule would constitute chattel paper, as
such term is defined in the Uniform Commercial Code as in effect in any
applicable jurisdiction, no security interest therein may be created through the
transfer or possession of this Agreement in and of itself without the transfer
or possession of the original of a Schedule executed pursuant to this Agreement
and incorporating this Agreement by reference; and no security interest in this
Agreement and a Schedule may be created by the transfer or possession of any
counterpart of the Schedule other than the original thereof, which shall be
identified as the document marked "Original" and all other counterparts shall be
marked "Duplicate".
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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 ACT Manufacturing, Inc.
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxx
------------------------------------ ----------------------------
Name: Xxxxx X. Xxxxxxxx Name: Xxxxxxx X. Xxxxx
---------------------------------- --------------------------
Title: Risk Analyst Title: Chief Financial Officer
--------------------------------- -------------------------
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CORPORATE LESSEE'S
BOARD OF DIRECTORS RESOLUTION
The undersigned hereby certified: (i) that she/he is the Secretary of ACT
Manufacturing, Inc.; (ii) that the following is a true and correct copy of
resolutions duly adopted at a meeting of the Board of Directors of said
Corporation duly held on the 26th day of April, 1999; and (iii) that said
resolutions have not been amended, rescinded, modified or revoked, and are in
full force and effect:
"RESOLVED, that each of the officers of this Corporation, whose name
appears below:
/s/ Xxxx X. Xxxx /s/ Xxxxxxx X. Xxxxx
------------------------------ ---------------------------------
President Treasurer
/s/ Xxxxxxxx Xxxxxxxx /s/ Xxxxxxx X. Xxxxx
------------------------------ ---------------------------------
Vice President Secretary
or the duly elected or appointed successor in office of any or all of them, be,
and hereby is, authorized and empowered in the name and on behalf of this
Corporation to enter into, execute and deliver a master lease agreement with
General Electric Capital Corporation (together with its successors and assigns,
if any, "Lessor") as Lessor, providing for the leasing to (or sale and leaseback
by) this Corporation, from time to time, of certain equipment, and further
providing for this Corporation to indemnify said Lessor against certain
occurrences and against the loss of contemplated tax treatment; and
FURTHER RESOLVED, that each officer of this Corporation be, and is,
authorized and empowered in the name and on behalf of this Corporation to enter
into, execute and deliver any documents and to do and perform all other acts and
deeds which may be necessary or appropriate to effectuate the lease (or sale and
leaseback) of equipment from Lessor; and
FURTHER RESOLVED, that the Lessor may rely upon the aforesaid resolutions
until receipt by it of written notice of any change.
IN WITNESS WHEREOF, I have set my hand and affixed the seal of said
Corporation this 26th day of April, 1999.
(CORPORATE SEAL)
/s/ Xxxxxxx X. Xxxxx
----------------------
Secretary
