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SUNTRUST LEASING CORPORATION
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EQUIPMENT LEASE AGREEMENT NO. 00965
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THIS EQUIPMENT LEASE AGREEMENT (the "Lease") is made as of the 27 day of
September, 2001, by and between SUNTRUST LEASING CORPORATION, its successors and
assigns ("Lessor"), and ▇▇▇▇▇▇▇▇ CORPORATION, its successors and permitted
assigns ("Lessee").
The parties agree that Lessee shall lease from Lessor the property (the
"Equipment") described in the Equipment Schedule(s) to be executed pursuant
hereto (collectively, the "Equipment Schedule"), subject to the terms set forth
herein, in the Riders annexed hereto and in the Equipment Schedule. Certain
definitions and construction of certain of the terms used herein are provided in
Section 20 hereof.
1. TERM. The term of lease with respect to any item of the Equipment shall
consist of the term set forth in the Equipment Schedule relating thereto;
provided, however, that this Lease shall be effective from and after the date of
execution hereof.
2. RENT. Lessee shall pay Lessor the rental installments in the aggregate
amounts specified in the Equipment Schedule, without prior notice or demand, and
all other amounts payable pursuant to this Lease (such installments and other
amounts, the "rent"). Each Equipment Schedule constitutes a non-cancelable net
lease, and Lessee's obligation to pay rent, and otherwise to perform its
obligations under this Lease, each such Equipment Schedule and all of the other
documents and agreements entered into in connection herewith (collectively, the
"Lease Documents"), are and shall be absolute and unconditional and shall not be
affected by any circumstances whatsoever, including any right of setoff,
counterclaim, recoupment, deduction, defense or other right which Lessee may
have against Lessor, the manufacturer or vendor of the Equipment (the
"Suppliers"), or anyone else, for any reason whatsoever. Rental installments are
payable as and when specified in the Equipment Schedule, without invoice or
other written demand (except as expressly provided in any Equipment Schedule).
Lessee agrees that all such rental installments and all other amounts payable by
Lessee under the Lease Documents shall be made by mailing the same to Lessor at:
▇.▇. ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, or by such other method as may
be from time to time directed by Lessor or its assignee in writing. All payments
under this Lease, including all rent installments, shall be effective upon
receipt. Timeliness of Lessee's payment and its other performance under the
Lease Documents is of the essence. Without limiting the generality of the
foregoing, Lessee hereby acknowledges that: (a) the Lessee is solely responsible
for making all rental installments and other amounts on a timely basis, (b) if
any such payment is not effected, whether due to the temporary suspension of
service or cancellation, there being insufficient funds in the Lessee's Account,
the Lessee's Account being closed or otherwise, Lessee must make the payment by
mail, wire transfer or such other method directed by Lessor, together with a
return fee with respect to any such "returned item," in the amount specified in
each Equipment Schedule and (c) if such payment is not so timely paid, Lessor
shall be entitled to all rights and remedies available to it hereunder with
respect to late payments or non-payment as applicable. If any rent is not paid
on the due date, Lessor may collect, and Lessee agrees to pay, a charge (the
"Late Charge") calculated as the product of the late charge rate specified in
the Equipment Schedule (the "Late Charge Rate") and the amount in arrears for
the period such amount remains unpaid.
3. REPRESENTATIONS AND WARRANTIES OF LESSEE. Lessee represents and warrants
that: (a) Lessee is a corporation duly organized, validly existing and in good
standing under the laws of the state of its incorporation specified below the
signature of Lessee, and Lessee has not previously changed its state of
incorporation, and the organizational number assigned to Lessee by such
jurisdiction is as specified below the Lessee's signature. (b) The execution,
delivery and performance of the Lease Documents and compliance with the terms
thereof: (1) have been duly authorized by all necessary corporate action on the
part of Lessee; (2) do not require the approval of any stockholder, trustee or
holder of any obligations of Lessee or any license, permit or other approval by,
giving of notice to, or filing or recording with, any governmental authority, in
each such case, except such as have been duly obtained; and (3) do not and will
not contravene any law, governmental rule, regulation or order now binding on
Lessee, or the charter or by-laws of Lessee, or contravene the provisions of, or
constitute a default under, or result in the creation of any lien or encumbrance
upon the property of Lessee under, any indenture, mortgage, contract or other
agreement to which Lessee is a party or by which it or its property is bound.
(c) Each of the Lease Documents, when entered into, will constitute legal, valid
and binding obligations of Lessee enforceable against Lessee, in accordance with
the terms thereof. (d) There are no pending actions or proceedings to which
Lessee is a party, and there are no other pending or threatened actions or
proceedings of which Lessee has knowledge, before any court, arbitrator or
administrative agency, which, either individually or in the aggregate, would
materially adversely affect the financial condition of Lessee, or the ability of
Lessee to perform its obligations under or remain in compliance with the Lease
Documents. Further, Lessee is not in default under any obligation for borrowed
money, for the deferred purchase price of property or any lease agreement which,
either individually or in the aggregate, would have the same such effect. (e)
Under the laws of the state(s) in which the Equipment is to be located, the
Equipment consists solely of personal property. (f) The financial statements of
Lessee (copies of which have been furnished to Lessor) have been prepared in
accordance with generally accepted accounting principles consistently applied
("GAAP"), and fairly present Lessee's financial condition and the results of its
operations as of the date of and for the period covered by such statements. (g)
Lessee's full and accurate legal name is as first provided above. The address
stated below the signature of Lessee is the chief place of business and chief
executive office of Lessee; and Lessee does not conduct business under a trade,
assumed or fictitious name. (h) Lessor has first priority perfected security
interest in each item of Equipment leased under each Equipment Schedule.
4. FINANCIALS, FURTHER ASSURANCES AND NOTICES. Lessee covenants and agrees
as follows: (a) Lessee will furnish Lessor or make available on the worldwide
web at ▇▇▇▇▇▇▇▇.▇▇▇ (1) within one hundred twenty (120) days after the end of
each fiscal year of Lessee, a balance sheet of Lessee as at the end of such
year, and the related statement of income and statement of cash flows of Lessee
for such fiscal year, prepared in accordance with GAAP, all in reasonable detail
and certified by independent certified public accountants of recognized standing
selected by Lessee (which shall be
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a "Big 6" accounting firm or BDO ▇▇▇▇▇▇▇); (2) within forty-five (45) days after
the end of each quarter, a balance sheet of Lessee as at the end of such
quarter, and the related statement of income and statement of cash flows of
Lessee for such quarter, prepared in accordance with GAAP; and (3) within thirty
(30) days after the date on which they are filed, all regular periodic reports,
forms and other filings required to be made by Lessee to the Securities and
Exchange Commission, if any. (b) Lessee will promptly execute and deliver to
Lessor such further documents, instruments and assurances and take such further
action as Lessor from time to time may reasonably request in order to carry out
the intent and purpose of this Lease and to establish and protect the rights and
remedies created or intended to be created in favor of Lessor under the Lease
Documents. (c) Lessee shall provide written notice to Lessor: (1) thirty (30)
days prior to any contemplated change in the name or address of the chief
executive office of Lessee; (2) promptly upon the occurrence of any Default (as
hereinafter defined) or event which, with the lapse of time or the giving of
notice, or both, would become a Default (a "default"; except as used in Sections
15 and 16); and (3) promptly upon Lessee becoming aware of any alleged violation
of applicable law relating to the Equipment or this Lease.
5. CONDITIONS PRECEDENT. Lessor's obligations under each Equipment
Schedule, including its obligation to purchase and lease any Equipment to be
leased thereunder, are conditioned upon Lessor's determination that all of the
following have been satisfied: (a) Lessor having received the following, in form
and substance satisfactory to Lessor: (1) evidence as to due compliance with the
insurance provisions hereof; (2) Uniform Commercial Code financing statements
and all other filings and recordings as required by Lessor; (3) certificate of
Lessee's Secretary certifying: (i) resolutions of Lessee's Board of Directors
duly authorizing the leasing, or sale and leaseback, as the case may be, of the
Equipment hereunder and the execution, delivery and performance of this Lease
and the Equipment Schedule and all related instruments and documents, and (ii)
the incumbency and signature of the officers of Lessee authorized to execute
such documents; (4) if requested by Lessor, an opinion of counsel for Lessee as
to each of the matters set forth in sub-parts (a) through (d) and (h) of Section
3 hereof; (5) the only manually executed original of the Equipment Schedule and
all other Lease Documents; (6) all purchase documents pertaining to the
Equipment (collectively, the "Supply Contract"); (7) the ▇▇▇▇(s) of sale for the
Equipment (collectively, the "▇▇▇▇ of Sale"); and (8) such other documents,
agreements, instruments, certificates, opinions, and assurances, as Lessor
reasonably may require. (b) All representations and warranties provided in favor
of Lessor in any of the Lease Documents shall be true and correct on the
effective date of such Equipment Schedule with the same effect as though made as
of such date (Lessee's execution and delivery of the Equipment Schedule shall
constitute an acknowledgment of the same). (c) There shall be no default or
Default under the Equipment Schedule or any other Lease Documents. The Equipment
shall have been delivered to and accepted by Lessee, and shall be in the
condition and repair required hereby; and on the effective date of the Equipment
Schedule, Lessor shall have received good title to the Equipment to be leased
thereunder, and shall have retained a first priority perfected security interest
in such Equipment free and clear of any other lien, claim or encumbrance of any
kind.
6. DELIVERY; INSPECTION AND ACCEPTANCE BY LESSEE. Upon delivery, Lessee
shall inspect and, to the extent the Equipment conforms to the condition
required by the applicable Supply Contract, accept the Equipment and shall
execute and deliver to Lessor an Equipment Schedule, and (if the subject of a
sale and leaseback transaction) a ▇▇▇▇ of Sale, containing a complete
description of the item of Equipment accepted; whereupon, as between Lessor and
Lessee, the same shall be deemed to have been finally accepted by Lessee
pursuant to this Lease. All expenses incurred in connection with Lessor's
purchase of the Equipment (including shipment, delivery and installation) shall
be the responsibility of Lessee and shall be paid upon demand. If Lessee shall,
for reasonable cause, refuse to accept delivery of any item of the Equipment,
Lessee will be assigned all rights and shall assume all obligations as purchaser
of the Equipment.
7. USE AND MAINTENANCE. (a) Lessee shall (1) use the Equipment solely in
the Continental United States and in the conduct of its business, for the
purpose for which the Equipment was designed, in a careful and proper manner
(and shall not permanently discontinue use of the Equipment); (2) operate,
maintain, service and repair the Equipment, and maintain all records and other
materials relating thereto, (i) in accordance and consistent with (A) the
Supplier's recommendations all maintenance and operating manuals or service
agreements, whenever furnished or entered into, including any subsequent
amendments or replacements thereof, issued by the Supplier or service provider,
(B) the requirements of all applicable insurance policies, (C) the Supply
Contract, so as to preserve all of Lessee's and Lessor's rights thereunder,
including all rights to any warranties, indemnities or other rights or remedies,
(D) all applicable laws, and (E) the prudent practice of other similar companies
in the same business as Lessee, but in any event, to no lesser standard than
that employed by Lessee for comparable equipment owned or leased by it; and (ii)
without limiting the foregoing, so as to cause the Equipment to be in good
repair and operating condition and in at least the same condition as when
delivered to Lessee hereunder, except for ordinary wear and tear resulting
despite Lessee's full compliance with the terms hereof; (3) not remove from the
Lessee's facilities any Equipment as specified in the Equipment Schedule without
the prior written consent of Lessor; (4) not attach or incorporate the Equipment
to or in any other item of equipment in such a manner that the Equipment may be
deemed to have become an accession to or a part of such other item of equipment;
and (5) cause each principal item of the Equipment to be continually marked, in
a plain and distinct manner, with the name of Lessor followed by the word
"Lessor," or other appropriate words designated by Lessor on labels furnished by
Lessor. (b) Within a reasonable time, Lessee will replace any parts of the
Equipment which become worn out, lost, destroyed, damaged beyond repair or
otherwise permanently rendered unfit for use, by replacement parts which are
free and clear of all liens, encumbrances or rights of others and have a value,
utility and remaining useful life at least equal to the parts replaced. All such
parts, improvements and additions to the Equipment immediately shall become
subject to the security interest held by Lessor hereunder, without cost or
expense to Lessor or any further action by any other person, and such parts,
improvements and additions shall be deemed incorporated in the Equipment and
subject to the terms of this Lease as if originally leased hereunder. Except to
the extent the same are replaced in accordance with this Section 7(b), Lessee
shall not detach or otherwise remove any parts originally or from time to time
attached to the Equipment, if such parts are essential to the operation of the
Equipment, are required by any other provision hereof or cannot be detached from
the Equipment without materially interfering with the operation of the Equipment
or adversely affecting the value, utility and remaining useful life which the
Equipment would have had without the addition thereof. Lessee shall not make any
material alterations to the Equipment without the prior written consent of
Lessor. (c) Upon forty-eight (48) hours' notice, Lessee shall afford Lessor
and/or its designated representatives access to the premises where the Equipment
is located for the purpose of inspecting such Equipment and all applicable
maintenance or other records at any reasonable time during normal business
hours; provided, however, if a default or Default shall have occurred and then
be continuing, no notice of any inspection by Lessor shall be required.
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8. DISCLAIMER OF WARRANTIES. LESSOR IS NOT A SELLER, SUPPLIER OR
MANUFACTURER (AS SUCH TERMS ARE DEFINED OR USED, AS THE CASE MAY BE, IN THE
UNIFORM COMMERCIAL CODE), OR DEALER, NOR A SELLER'S OR A DEALER'S AGENT. THE
EQUIPMENT IS LEASED HEREUNDER "AS IS", AND LESSOR HAS NOT MADE, AND HEREBY
DISCLAIMS LIABILITY FOR, AND LESSEE HEREBY WAIVES ALL RIGHTS AGAINST LESSOR
RELATING TO, ANY AND ALL WARRANTIES, REPRESENTATIONS OR OBLIGATIONS OF ANY KIND
WITH RESPECT TO THE EQUIPMENT, EITHER EXPRESS OR IMPLIED, ARISING BY APPLICABLE
LAW OR OTHERWISE, INCLUDING ANY OF THE SAME RELATING TO OR ARISING IN OR UNDER
(a) MERCHANTABILITY OR FITNESS FOR PARTICULAR USE OR PURPOSE, (b) COURSE OF
PERFORMANCE, COURSE OF DEALING OR USAGE OR TRADE OR (c) TORT (WHETHER OR NOT
ARISING FROM THE ACTUAL, IMPLIED OR IMPUTED NEGLIGENCE OF LESSOR OR STRICT
LIABILITY) OR THE UNIFORM COMMERCIAL CODE (INCLUDING ARTICLE 2 THEREOF) OR OTHER
APPLICABLE LAW WITH RESPECT TO THE EQUIPMENT, INCLUDING ITS TITLE OR FREEDOM
FROM LIENS, FREEDOM FROM TRADEMARK, PATENT OR COPYRIGHT INFRINGEMENT, FREEDOM
FROM LATENT DEFECTS (WHETHER OR NOT DISCOVERABLE), CONDITION, MANUFACTURE,
DESIGN, SERVICING OR COMPLIANCE WITH APPLICABLE LAW; it being agreed that all
such risks, as between Lessor and Lessee, are to be borne by Lessee; and
Lessor's agreement to enter into this Lease and any Equipment Schedule is in
reliance upon the freedom from and complete negation of liability or
responsibility for the matters waived and disclaimed herein. Lessor is not
responsible for any direct, indirect, incidental or consequential damage to or
losses resulting from the installation, operation or use of the Equipment or any
products manufactured thereby. All assignable warranties made by the Supplier to
Lessor are hereby assigned to Lessee for and during the term of this Lease and
Lessee agrees to resolve all such claims directly with the Supplier. Provided
that no default or Default has occurred and is then continuing, Lessor fully
shall cooperate with Lessee with respect to the resolution of such claims, in
good faith and by appropriate proceedings at Lessee's expense. Any such claim
shall not affect in any manner the unconditional obligation of Lessee to make
rent payments hereunder.
9. FEES AND TAXES. (a) To the extent permitted by law, Lessee shall file
any necessary report and return for, shall pay promptly when due, shall
otherwise be liable to reimburse Lessor (on an after-tax basis) for, and agrees
to indemnify and hold Lessor harmless from taxes (other than taxes calculated
solely on the basis of net income and the Michigan Single Business Tax),
assessments and all other charges or withholdings of any nature (together with
any penalties, fines or interest thereon); arising at any time upon or relating
to the Equipment or this Lease or the delivery, acquisition, ownership, use,
operation or leasing or other disposition of the Equipment, or upon the rent,
whether the same be assessed to Lessor or Lessee (any of the foregoing, an
"Imposition"). (b) If any report, return or property listing, or any Imposition
is, by law, required to be filed by, assessed or billed to, or paid by, Lessor,
Lessee at its own expense will do all things required to be done by Lessor (to
the extent permitted by law) in connection therewith and is hereby authorized by
Lessor to act on behalf of Lessor in all respects, including the contest or
protest, in good faith and by appropriate proceedings, of the validity of any
Imposition, or the amount thereof. Lessor agrees fully to cooperate with Lessee
in any such contest, and Lessee agrees promptly to indemnify Lessor for all
reasonable expenses incurred by Lessor in the course of such cooperation. An
Imposition or Claim (as hereinafter defined) therefor shall be paid, subject to
refund proceedings, if failure to pay would adversely affect the title or rights
of Lessor. Provided that no default or Default has occurred and is continuing,
if Lessor obtains a refund of any Imposition which has been paid (by Lessee, or
by Lessor and for which Lessor has been reimbursed by Lessee), Lessor shall
promptly pay to Lessee the net amount of such refund to the extent actually
received. Lessee will cause all ▇▇▇▇▇▇▇▇ of such charges to Lessor to be made to
Lessor in care of Lessee and will, in preparing any report or return required by
law, show the ownership of the Equipment in Lessee, and shall send a copy of any
such report or return to Lessor. If Lessee fails to pay any such charges when
due, except any Imposition being contested in good faith and by appropriate
proceedings as above provided for a reasonable period of time, Lessor at its
option may do so, in which event the amount so paid (including any penalty or
interest incurred as a result of Lessee's failure), plus interest thereon at the
Late Charge Rate, shall be paid by Lessee to Lessor with the next periodic
payment of rent. (c) As used herein, the term "Lessor" shall mean and include
Lessor and the consolidated Federal taxpayer group of which Lessor is a member.
10. OWNERSHIP; GRANT OF SECURITY INTEREST; USURY SAVINGS AND LIENS. (a) For
income tax purposes, Lessor will treat Lessee as the Owner of the Equipment.
Accordingly, Lessor agrees (i) to treat Lessee as the owner of the Equipment on
its federal income tax return, (ii) not to take actions or positions
inconsistent with such treatment on or with respect to its federal income tax
return, and not claim any tax benefits available to an owner of the Equipment on
or with respect to its federal income tax return. Lessor shall in no event be
liable to Lessee if Lessee fails to secure any of the tax benefits available to
the owner of the Equipment. (b) The parties intend and agree that the Equipment
shall remain personal property, and that Lessor's interest therein not be
impaired, notwithstanding the manner in which it may be affixed to any real
property. Lessee shall obtain and deliver to Lessor (to be recorded at Lessor's
expense), from any person having an interest in the property where the Equipment
is to be located, waivers of any lien, encumbrance or interest which such person
might have or hereafter obtain or claim with respect to the Equipment. (c) It is
the express intention of the parties hereto that (1) each Equipment Schedule,
incorporating by reference the terms of this Lease, constitutes a retention of
security interest by Lessor in the Equipment described therein and not a true
"lease" as defined in the Code. In order to secure the prompt payment and
performance as and when due of all of Lessee's obligations (both now existing
and hereafter arising) under each such Equipment Schedule, Lessee shall be
deemed to have granted, and it hereby grants, to Lessor a first priority
security interest in the following (whether now existing or hereafter created):
the Equipment leased pursuant to such Equipment Schedule and all replacements,
substitutions, improvements, additions, accessions, and proceeds (cash and
non-cash; but without power of sale), including the proceeds of all insurance
policies, thereof, and (B) Lessee agrees that with respect to the Equipment, in
addition to all of the other rights and remedies available to Lessor hereunder
upon the occurrence of a Default, Lessor shall have all of the rights and
remedies of a first priority secured party under the Code. If a court of
competent jurisdiction determines that any Equipment Schedule is a sale and
extension of credit, a lease intended for security, a loan secured by the
Equipment described in such Equipment Schedule or other similar arrangement, (A)
the principal amount of any such loan shall be an amount equal to the Total
Invoice Cost, (B) the term of any such loan shall be the same as the Term
specified for such Equipment in the related Equipment Schedule, (C) the loan
payments under any such loan shall be the regular installments of Rent specified
in the Equipment Schedule for such Equipment, and (D) any such loan shall be at
an interest rate that is equal to the lesser of the maximum lawful rate
permitted by applicable law or the effective interest rate calculated on the
basis of the foregoing principal amount, loan term and loan payments as if the
principal amount were fully amortized over the term of the loan. (d) Lessee may
not dispose of any of the Equipment except to the extent expressly provided
herein, notwithstanding the fact that proceeds constitute a part of the
Equipment. Lessee further agrees to maintain the Equipment free from all claims,
liens,
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attachments, rights of others and legal processes ("Liens") of creditors of
Lessee or any other persons, other than (1) the rights, title and interest of
Lessor and (2) Liens for fees, taxes, levies, duties or other governmental
charges of any kind, Liens of mechanics, materialmen, laborers, employees or
suppliers and similar Liens arising by operation of law incurred by Lessee in
the ordinary course of business for sums that are not yet delinquent or are
being contested in good faith by negotiations or by appropriate proceedings
which suspend the collection thereof (provided, however, that such proceedings
do not involve any substantial danger (as determined in Lessor's sole reasonable
discretion) of the sale, forfeiture or loss of the Equipment or any interest
therein). Lessee will defend, at its own expense, Lessor's interest in the
Equipment, and its first priority, from such claims, Liens or legal processes.
Lessee shall also notify Lessor immediately upon receipt of notice of any Lien
affecting the Equipment in whole or in part.
11. INSURANCE. Lessee shall obtain and maintain all-risk insurance coverage
with respect to the Equipment insuring against, among other things: any casualty
to the Equipment (or any portion thereof), including loss or damage due to fire
and the risks normally included in extended coverage, malicious mischief and
vandalism, for not less than the greater of the full replacement value or the
Stipulated Loss Value (as defined in Section 12 hereof); and any public
liability arising in connection with the Equipment, including both personal
injury and property damage with a combined single limit per occurrence of not
less than the amount specified in the Equipment Schedule, with a deductible in
an aggregate amount not greater than the amount set forth in such Equipment
Schedule. All said insurance shall be in form (including all endorsements
required by Lessor) and amount and with companies reasonably satisfactory to
Lessor. All insurance for loss or damage shall provide that losses, if any,
shall be payable to Lessor as sole loss payee and Lessee shall utilize its best
efforts to have all checks relating to any such losses delivered promptly to
Lessor. Lessor shall be named as an additional insured with respect to all such
liability insurance. Lessee shall pay the premiums therefor and deliver to
Lessor evidence satisfactory to Lessor of such insurance coverage. Lessee shall
cause to be provided to Lessor, not less than fifteen (15) days prior to the
scheduled expiration or lapse of such insurance coverage, evidence satisfactory
to Lessor of renewal or replacement coverage. Each insurer shall agree, by
endorsement upon the policy or policies issued by it or by independent
instrument furnished to Lessor, that (a) it will give Lessor thirty (30) days'
prior written notice of the effective date of any material alteration or
cancellation of such policy; and (b) insurance as to the interest of any named
additional insured or loss payee other than Lessee shall not be invalidated by
any actions, inactions, breach of warranty or conditions or negligence of Lessee
or any person other than Lessor with respect to such policy or policies. The
proceeds of such insurance payable as a result of loss of or damage to the
Equipment shall be applied as required by the provisions of Section 12 hereof.
12. LOSS AND DAMAGE. Lessee assumes the risk of direct and consequential
loss and damage to the Equipment from all causes. Except as provided in this
Section for discharge upon payment of Stipulated Loss Value and the other
specified amounts, no loss or damage to the Equipment or any part thereof shall
release or impair any obligations of Lessee under this Lease. Lessee agrees that
Lessor shall not incur any liability to Lessee for any loss of business, loss of
profits, expenses, or any other Claims resulting to Lessee by reason of any
failure of or delay in delivery or any delay caused by any non-performance,
defective performance, or breakdown of the Equipment, nor shall Lessor at any
time be responsible for personal injury or the loss or destruction of any other
property resulting from the Equipment. In the event of loss or damage to any
item of Equipment which does not constitute a Total Loss (as hereinafter
defined), Lessee shall, at its sole cost and expense, promptly repair and
restore such item of the Equipment to the condition required by this Lease.
Provided that no default or Default has occurred and is continuing, upon receipt
of evidence reasonably satisfactory to Lessor of completion of such repairs,
Lessor will apply any net insurance proceeds received by Lessor on account of
such loss to the cost of repairs. Upon the occurrence of the actual or
constructive total loss of any item of the Equipment, or the loss,
disappearance, theft or destruction of any item of the Equipment or damage to
any item of the Equipment to such extent as shall make repair thereof
uneconomical or shall render any item of the Equipment permanently unfit for
normal use for any reason whatsoever, or the condemnation, confiscation,
requisition, seizure, forfeiture or other taking of title to or use of any item
of the Equipment or the imposition of any Lien thereon by any governmental
authority (as established to the reasonable satisfaction of Lessor; any such
occurrence being herein referred to as a "Total Loss"), during the term of this
Lease, Lessee shall give prompt notice thereof to Lessor. On the next date for
the payment of rent, Lessee shall pay to Lessor the rent due on that date plus
the Stipulated Loss Value of the item or items of the Equipment with respect to
which the Total Loss has occurred and any other sums due hereunder with respect
to that Equipment (less any insurance proceeds or condemnation award actually
paid). Upon making such payment, this Lease and the obligation to make future
rental payments shall terminate solely with respect to the Equipment or items
thereof so paid for and (to the extent applicable) Lessee shall become entitled
thereto "AS IS WHERE IS" without warranty, express or implied, with respect to
any matter whatsoever. Lessor shall deliver to Lessee such Uniform Commercial
Code Statements of Termination, Release or Partial Release as reasonably may be
required in order to terminate any interest of Lessor in and to the Equipment.
As used in this Lease, "Stipulated Loss Value" shall mean the product of the
Total Invoice Cost (designated on the appropriate Equipment Schedule) of the
Equipment and the applicable percentage factor set forth on the Schedule of
Stipulated Loss Values attached to the Equipment Schedule. Stipulated Loss Value
shall be determined as of the next date on which a payment of rent is or would
be due after a Total Loss or other termination of an Equipment Schedule, after
payment of any rent due on such date, and the applicable percentage factor shall
be that which is set forth with respect to such rent payment. After payment of
the final payment of rent due under the original term of an Equipment Schedule,
Stipulated Loss Value shall be determined as of the date of termination of such
Equipment Schedule, and the applicable percentage factor shall be the last
percentage factor set forth on the Schedule of Stipulated Loss Values attached
to such Equipment Schedule.
13. REDELIVERY. Upon the expiration or earlier termination of the term of
any Equipment Schedule (or of any renewal thereof, if applicable), Lessee shall,
unless Lessee has paid the Stipulated Loss Value and other amounts with respect
thereto pursuant to Section 12 hereof or has exercised its option to purchase
pursuant to Section 18(b) hereof and fully satisfied its obligations thereunder,
at its own expense, return the Equipment to Lessor within ten (10) days (a) in
the same condition as when delivered to Lessee hereunder, ordinary wear and tear
resulting from proper use thereof excepted, (b) in such operating condition as
is capable of performing its originally intended use, (c) having been used,
operated, serviced and repaired in accordance with, and otherwise complying
with, Section 7 hereof, and (d) free and clear of all Liens whatsoever except
Liens resulting from claims against Lessor not relating to the ownership of such
Equipment. Lessee shall return the Equipment by delivering it to such place
within the Continental United States as Lessor shall specify. In addition to
Lessor's other rights and remedies hereunder, if the Equipment is not returned
in a timely fashion, or if repairs are necessary to place any items of Equipment
in the condition required in this Section, Lessee shall continue to pay to
Lessor per diem rent at the last prevailing lease rate under the applicable
Equipment Schedule with respect to such
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items of Equipment, for the period of delay in redelivery, or for the period of
time reasonably necessary to accomplish such repairs together with the cost of
such repairs, as applicable. Lessor's acceptance of such rent on account of such
delay or
repair does not constitute a renewal of the term of the related Equipment
Schedule or a waiver of Lessor's right to prompt return of the Equipment in
proper condition.
14. INDEMNITY. Lessee assumes and agrees to indemnify, defend and keep
harmless Lessor, and any assignee of Lessor's rights, obligations, title or
interests under any Equipment Schedule, its agents and employees
("Indemnitees"), from and against any and all Claims (other than such as may
directly and proximately result from the gross negligence or willful misconduct
of, such Indemnitees; provided, however, that Lessee expressly agrees to
indemnify each such Indemnitee where the Claims arise in whole or in part from
the simple negligence of such Indemnitee), by paying (on an after-tax basis) or
otherwise discharging same, when and as such Claims shall become due, including
Claims arising on account of (a) any Lease Document, or (b) the Equipment, or
any part thereof, including the ordering, acquisition, delivery, installation or
rejection of the Equipment, the possession, maintenance, use, condition,
ownership or operation of any item of Equipment, and by whomsoever owned, used
or operated, during the term of any Equipment Schedule with respect to that item
of Equipment, the existence of latent and other defects (whether or not
discoverable by Lessor or Lessee) any claim in tort for negligence or strict
liability, and any claim for patent, trademark or copyright infringement, or the
loss, damage, destruction, removal, return, surrender, sale or other disposition
of the Equipment, or any item thereof, or for whatever other reason whatsoever.
It is the express intention of both Lessor and Lessee, that the indemnity
provided for in this Section 14 includes the agreement by Lessee to indemnify
the Indemnitees from the consequences of such Indemnitees' own simple
negligence, whether that negligence is the sole or concurring cause of the
Claims, and to further indemnify such Indemnitees with respect to Claims for
which the Indemnitees are strictly liable. Lessor shall give Lessee prompt
notice of any Claim hereby indemnified against and Lessee shall be entitled to
control the defense thereof, so long as no default or Default has occurred and
is then continuing; provided, however, that Lessor shall have the right to
approve defense counsel selected by Lessee. For the purposes of this Lease, the
term "Claims" shall mean all claims, allegations, ▇▇▇▇▇, judgments, good faith
settlements entered into, suits, actions, debts, obligations, damages (whether
incidental, consequential or direct), demands (for compensation,
indemnification, reimbursement or otherwise), losses, penalties, fines,
liabilities (including strict liability), charges that Lessor has incurred or
for which it is responsible, in the nature of interest, Liens, and costs
(including attorneys' fees and disbursements and any other legal or non-legal
expenses of investigation or defense of any Claim, whether or not such Claim is
ultimately defeated or enforcing the rights, remedies or indemnities provided
for hereunder, or otherwise available at law or equity to Lessor), of whatever
kind or nature, contingent or otherwise, matured or unmatured, foreseeable or
unforeseeable, by or against any person.
15. DEFAULT. (a) A default shall be deemed to have occurred hereunder and
under an Equipment Schedule ("Default") if (1) Lessee shall fail to make any
payment of rent hereunder or under an Equipment Schedule within ten (10) days
after the same shall have become due and written notice has been provided; or
(2) Lessee shall fail to obtain and maintain the insurance required herein; (3)
Lessee shall fail to perform or observe any other covenant, condition or
agreement to be performed or observed by it under any Lease Document and such
failure shall continue unremedied for a period of thirty (30) days after the
earlier of (i) actual knowledge thereof by any officer of Lessee, or (ii)
written notice thereof to Lessee by Lessor; or (4) Lessee shall (i) be generally
not paying its debts as they become due; or (ii) take action for the purpose of
invoking the protection of any bankruptcy or insolvency law, or any such law is
invoked against or with respect to Lessee or its property, and any such petition
filed against Lessee is not dismissed within sixty (60) days; or (5) Lessee
shall make or permit any unauthorized Lien against, or assignment or transfer
of, this Lease, an Equipment Schedule, the Equipment or any interest therein; or
(6) any certificate, statement, representation, warranty or audit contained
herein or furnished with respect hereto by or on behalf of Lessee 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 Lessee; or (7) Lessee
shall be in default under (i) any loan, lease, guaranty, installment sale or
other financing agreement or contract greater than one million dollars, of which
Lessor, or any of its affiliates, is a party or beneficiary, or (ii) any other
material obligation for borrowed money, for the deferred purchase price of
property or any lease agreement, and the applicable grace period with respect
thereto shall have expired; or (8) Lessee shall have terminated its corporate
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 such person is organized and existing under the laws of
the United States or any state, and not less than sixty (60) days prior to such
Event: (i) such person executes and delivers to Lessor an agreement satisfactory
in form and substance to Lessor, in its sole discretion, containing such
person's effective assumption, and its agreement to pay, perform, comply with
and otherwise be liable for, in a due and punctual manner, all of Lessee's
obligations having previously arisen, or then or thereafter arising, under any
and all of the Lease Documents; and (ii) Lessor is satisfied as to the
creditworthiness of such person, and as to such person's conformance to the
other standard criteria then used by Lessor for such purposes; or (9)(i) The
occurrence of any change in the financial condition of Lessee or any guarantor
which in the good faith judgment of Lessor is materially adverse, (ii) if
Lessor, in good faith, determines that the prospect of payment or performance of
any of the material obligations is impaired for any reason, or (iv) there occurs
a default under or anticipatory repudiation of any guaranty executed in
connection with this Lease; or (10) if Lessee is a privately held corporation
and effective control of Lessee'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 (11) if Lessee is a publicly held corporation and, as a result of
or in connection with a material change in the ownership of Lessee's capital
stock, Lessee's Debt to Tangible Net Worth equals or exceeds twice the ratio of
Lessee's Debt to Tangible Net Worth as of the date of this Lease, without the
prior written consent of Lessor. As used herein, "Debt" shall mean Lessee's
total liabilities which, in accordance with GAAP, would be included in the
liability side of a balance sheet; and "Tangible Net Worth" shall mean Lessee's
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. Accounting terms used herein shall be as defined, and all
calculations hereunder shall be made, in accordance with GAAP. (b) The
occurrence of a Default with respect to any Equipment Schedule shall, at the
sole discretion of Lessor, constitute a Default with respect to any or all
Equipment Schedules to which it is then a party. Notwithstanding anything set
forth herein, Lessor may exercise all rights and remedies hereunder
independently with respect to each Equipment Schedule.
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16. REMEDIES. Without limiting Lessor's other rights hereunder, if Lessee
shall fail to pay any amount of rent hereunder or under any Equipment Schedule
within sixty (60) days after the same shall have become due and written notice
provided thereof, Lessee shall automatically be deemed to be in default
hereunder and under said Equipment Schedule
and all of Lessee's rights, but not its obligations, under such Equipment
Schedule and in and to the Equipment leased thereunder automatically shall be
terminated, whereupon Lessee's right to possess and use such Equipment
immediately shall cease; and Lessee hereby agrees that the foregoing shall occur
without act or notice as a condition thereto, and any such requirement of any
act or notice under applicable law is hereby expressly and irrevocably waived to
the extent permitted thereunder. Upon the occurrence of any other Default under
the provisions of Section 15 (including the failure to make any payment of rent
as and when due), Lessor may, at its option, declare this Lease and such
Equipment Schedule to be in default. At any time after termination of an
Equipment Schedule or after declaration by Lessor that such Equipment Schedule
is in default, Lessor may, in addition to any other remedies provided herein or
by applicable law, exercise one or more of the following remedies as Lessor in
its sole discretion shall elect:
(a)(1) Declare the Stipulated Loss Value of the Equipment (determined
as of the next date on which a payment is or would have been due after the
declaration of a Default), together with all other sums then due under such
Equipment Schedule, immediately due and payable with respect to any or all of
the Equipment (the parties also deem that such amount best reflects the damages
Lessor would sustain in the event of Lessee's bankruptcy or insolvency and such
Equipment Schedule were not assumed); and/or (2) accelerate and ▇▇▇ for and
recover all rent and other payments payable under such Equipment Schedule, then
accrued or thereafter accruing (including all mandatory renewal payments,
purchase option payments and any and all other amounts payable by Lessee upon
the expiration of the term of such Equipment Schedule or the return of the
Equipment leased thereunder), with respect to any or all of the Equipment
(discounted to present value at a rate equal to the rate implicit in the
Schedule minus one per cent). (in the event such Equipment Schedule and Lessee's
rights automatically are terminated pursuant to the first sentence of this
Section 16, the amounts payable under clause (1) of this paragraph (a)
automatically shall become due and payable on the date of such termination,
without notice or demand, except as otherwise may be provided in writing by
Lessor); and/or
(b)(1) Require Lessee to assemble any or all of the Equipment at the
location to which the Equipment was delivered or the location to which such
Equipment may have been moved by Lessee or such other location in reasonable
proximity to either of the foregoing as Lessor shall designate; and/or to return
promptly, at Lessee's expense, any or all of the Equipment to Lessor at the
location, in the condition and otherwise in accordance with all of the terms of
Section 13 hereof; and/or (2) take possession of any or all of the Equipment,
wherever it may be located, without any court order or other process of law and
without liability for any damages occasioned by such taking of possession (other
than to premises) (any such taking of possession shall constitute an automatic
termination of the Equipment Schedule pertaining thereto without further notice,
and such taking of possession shall not prohibit Lessor from exercising its
other remedies hereunder).
(c)(1) Sell, release or otherwise dispose of any or all of the
Equipment, whether or not in Lessor's possession, in a commercially reasonable
manner at public or private sale with notice to Lessee (the parties agreeing
that ten (10) days' prior written notice shall constitute adequate notice of
such sale), with the right of Lessor to purchase and apply the net proceeds of
such disposition, after deducting all costs incurred by Lessor in connection
with such Default and all costs of such disposition (including but not limited
to costs of transportation, possession, storage, refurbishing, advertising and
brokers' fees), to the obligations of Lessee under such Equipment Schedule, any
other Equipment Schedule to which Lessor is then a party and any related Lease
Documents with Lessee remaining liable for any deficiency and with any excess
being for the account of Lessee; or (2) retain any recovered Equipment.
(d) Terminate such Equipment Schedule as to any or all of the
Equipment.
(e) Proceed by appropriate court action, either at law or in equity
(including an action for specific performance), to enforce performance by Lessee
or to recover damages associated with such Default; or exercise any other right
or remedy available to Lessor at law or in equity.
(f) By offset, recoupment or other manner of application, apply any
security deposit, monies held in deposit or other sums then held by Lessor, and
with respect to which Lessee has an interest, against any obligations of Lessee
arising under this Lease, whether or not Lessee has pledged, assigned or granted
a security interest to Lessor in any or all such sums as collateral for said
obligations.
Unless otherwise provided above, a termination of any Equipment
Schedule shall occur only upon written notice by Lessor to Lessee and only with
respect to such items of the Equipment as Lessor specifically elects to
terminate in such notice. Except as to such items of the Equipment with respect
to which there is a termination, this Lease and the Equipment Schedules not so
terminated shall remain in full force and effect and Lessee shall be and remain
liable for the full performance of all its obligations hereunder and thereunder.
Except as otherwise specifically provided above, (A) Lessee shall also be liable
for (1) all unpaid rent due hereunder before, during or after exercise of any of
the foregoing remedies, (2) for all reasonable legal fees and other expenses
incurred by reason of any default or Default or the exercise of Lessor's rights
or remedies with respect thereto, including all costs and expenses incurred in
connection with the return, repossession or other recovery of any Equipment in
accordance with the terms of Section 13 hereof and this Section 16 or in placing
such Equipment in the condition required by said Sections, and all other
pre-judgment and post-judgment enforcement related actions taken by Lessor, and
(3) Late Charges which shall accrue and be payable with respect to any and all
amounts becoming due pursuant to this Section 16 from and after the due date
therefor until payment of the full amount thereof is made; and (B) no right or
remedy referred to in this Section is intended to be exclusive, but each shall
be cumulative and shall be in addition to any other remedy referred to above or
otherwise available at law or in equity, and may be exercised concurrently or
separately from time to time. The failure of Lessor to exercise the rights
granted hereunder upon any Default by Lessee shall not constitute a waiver of
any such right upon the continuation or reoccurrence of any such Default. In no
event shall the execution of an Equipment Schedule constitute a waiver by Lessor
of any pre-existing Default in the performance of the terms and conditions
hereof.
17. ASSIGNMENT. (a) WITHOUT THE PRIOR WRITTEN CONSENT OF LESSOR (WHICH
SHALL NOT UNREASONABLY BE WITHHELD), LESSEE WILL NOT SELL, ASSIGN, TRANSFER OR
ENCUMBER ANY OF ITS RIGHTS OR OBLIGATIONS HEREUNDER OR UNDER ANY EQUIPMENT
SCHEDULE, OR ITS LEASEHOLD OR OTHER INTEREST IN THE EQUIPMENT, SUBLET THE
EQUIPMENT OR OTHERWISE PERMIT THE EQUIPMENT TO BE OPERATED OR USED BY, OR TO
COME INTO OR REMAIN IN THE POSSESSION OF, ANYONE BUT LESSEE. No sale, assignment
or sublease, whether authorized in this Section or in violation of the terms
hereof, shall relieve Lessee
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of its obligations, and Lessee shall remain primarily liable, hereunder and
under each Equipment Schedule. Any unpermitted sale, assignment, transfer,
encumbrance, delegation or sublease by Lessee shall be void ab initio.
(b) LESSOR MAY AT ANY TIME ASSIGN ANY OR ALL OF ITS RIGHTS, OBLIGATIONS, TITLE
AND INTERESTS HEREUNDER AND UNDER ANY EQUIPMENT SCHEDULE, TO ANY OTHER PERSON.
If Lessee is given notice of any such assignment, Lessee shall acknowledge
receipt thereof in writing. Any such assignee shall have and be entitled to
exercise any and all rights and powers of Lessor hereunder, but such assignee
shall not be obligated to perform any of the obligations of Lessor hereunder
(other than the covenant of quiet enjoyment specified in Section 19(c) hereof;
or as otherwise provided in any notice with respect thereto by Lessor to
Lessee). Lessee will pay all rent and other amounts payable by Lessee hereunder
to such assignee, notwithstanding any defense or claim of whatever nature,
whether by reason of breach or otherwise which it may now or hereafter have
against Lessor; it being understood that in the event of a default or breach by
Lessor, that Lessee shall pursue any rights on account thereof solely against
Lessor. Lessee agrees that any such assignment shall not constitute a material
change to Lessee's duties or obligations under the Lease or any Equipment
Schedule nor materially increase Lessee's risks or burdens. Upon such assignment
and except as may otherwise be provided therein all references in this Lease to
Lessor shall include such assignee. (c) Subject always to the foregoing, this
Lease and each Equipment Schedule inure to the benefit of, and are binding upon,
the successors and assigns of the parties hereto and thereto, as the case may
be.
18. END OF LEASE OPTIONS. Upon the expiration of the term of each Equipment
Schedule (either the original term or any applicable renewal term), Lessee may
exercise the following specified options with respect to all (but not less than
all) of the Equipment leased under all Equipment Schedules executed hereunder,
upon the following terms and conditions.
(a) Return. If Lessee shall not have exercised its purchase option or
-------
renewal option pursuant to this Section, upon the expiration of the term (either
the original term or any applicable renewal term) of each Equipment Schedule,
Lessee shall return all (but not less than all) of the Equipment described on
all Equipment Schedules executed hereunder to Lessor upon the following terms
and conditions: Lessee shall (i) pay to Lessor on the last day of the term of
this Lease with respect to each individual Equipment Schedule, in addition to
the scheduled rent then due on such date and all other sums then due hereunder,
a terminal rental adjustment amount equal to the Fixed Purchase Price with
respect to such Equipment (as specified on the Equipment Schedule), and (ii)
return the Equipment to Lessor in accordance with Section 13 hereof. Thereafter,
upon return of all of the Equipment described on all Equipment Schedules
executed hereunder, Lessor and Lessee shall arrange for the commercially
reasonable sale, scrap or other disposition of the Equipment. Upon satisfaction
of the conditions specified in this sub-part (a), Lessor will transfer, on an AS
IS, WHERE IS BASIS, without recourse or warranty, express or implied, of any
kind whatsoever, all of Lessor's interest in and to the Equipment. Lessor shall
not be required to make and may specifically disclaim any representation or
warranty as the condition of such Equipment and other matters (except that
Lessor shall warrant that it has conveyed whatever interest it received in the
Equipment free and clear of any liens or encumbrances created by, through or
under Lessor). Lessor shall execute and deliver to Lessee such Uniform
Commercial Code Statements of Termination as reasonably may be required in order
to terminate any interest of Lessor in and to the Equipment. Upon the sale,
scrap or other disposition of the Equipment the net sales proceeds with respect
to the Equipment sold will be paid to, and held and applied by, Lessor as
follows: Lessor shall promptly thereafter pay to Lessee an amount equal to the
Residual Risk Amount (as specified in the Equipment Schedule) of the Equipment
plus all net proceeds of such sale, if any, (less all reasonable costs, expenses
and fees, including storage, reasonable and necessary maintenance and other
remarketing fees incurred in connection with the sale, scrap, or disposition of
such Equipment) in excess of the Residual Risk Amount of the Equipment and
applicable taxes, if any.
(b) Purchase. Lessee shall have the option, upon the expiration of the
---------
term (either the original term or any applicable renewal term) of each Equipment
Schedule, to purchase all (but not less than all) of the Equipment described on
all Equipment Schedules executed hereunder upon the following terms and
conditions: If Lessee desires to exercise this option with respect to the
Equipment, Lessee shall pay to Lessor on the last day of the term with respect
to each individual Equipment Schedule, in addition to the scheduled rent (if
any) then due on such date and all other sums then due hereunder, in cash the
purchase price for the Equipment so purchased, determined as hereinafter
provided. The purchase price of the Equipment shall be an amount equal to the
Fixed Purchase Price of such Equipment (as specified on the Equipment Schedule),
plus all taxes and charges upon sale and all other reasonable and documented
expenses incurred by Lessor in connection with such sale, including, without
limitation, any such expenses incurred based on a notice from Lessee to Lessor
that Lessee intended to return any such items of Equipment. Upon satisfaction of
the conditions specified in this sub-part, Lessor will transfer, on an AS IS,
WHERE IS BASIS, without recourse or warranty, express or implied, of any kind
whatsoever, all of Lessor's interest in and to the Equipment. Lessor shall not
be required to make and may specifically disclaim any representation or warranty
as to the condition of such Equipment and other matters (except that Lessor
shall warrant that it has conveyed whatever interest it received in the
Equipment free and clear of any lien or encumbrance created by, through or under
Lessor). Lessor shall execute and deliver to Lessee such Uniform Commercial Code
Statements of Termination as reasonably may be required in order to terminate
any interest of Lessor in and to the Equipment.
(c) Notice of Election. Lessee shall give Lessor written notice of its
-------------------
election of the options specified in this Section not less than one hundred
eighty (180) days nor more than three hundred sixty-five (365) days before the
expiration of the original term or any renewal term of the first Equipment
Schedule to be executed under this Lease. Such election shall be effective with
respect to all Equipment described on all Equipment Schedules executed
hereunder. If Lessee fails to timely provide such notice, without further action
Lessee automatically shall be deemed to have elected to purchase the Equipment
pursuant to sub-part (b) of this Section.
19. MISCELLANEOUS. (a) This Lease, the Riders annexed hereto, each
Equipment Schedule and any commitment letter between the parties, constitute the
entire agreement between the parties with respect to the subject matter hereof
and thereof and shall not be rescinded, amended or modified in any manner except
by a document in writing executed by both parties. (b) Any provision of this
Lease which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. (c) The
representations, warranties and covenants of Lessee herein shall be deemed to be
continuing and to survive the execution and delivery of this Lease, each
Equipment Schedule and any other Lease Documents. Each execution by Lessee of an
Equipment Schedule shall be deemed a reaffirmation and warranty that
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there shall have been no material adverse change in the business or financial
condition of Lessee from the date of execution hereof. With respect to each
Equipment Schedule, the obligations of Lessee under Sections 7, 8, 9, 10, 13, 14
and
18(a) hereof, together with any of Lessee's obligations under the other
provisions of this Lease (as incorporated therein) which have accrued but not
been fully satisfied, performed or complied with prior to the termination of
such Equipment Schedule, shall survive the termination thereof to the extent
necessary for the full and complete performance of such obligations. (d) Lessor
represents and covenants to Lessee that Lessor has full authority to enter into
this Lease and any other Lease Documents to which it may become a party, and so
long as no default or Default occurs with respect to an Equipment Schedule,
neither Lessor nor any person authorized by Lessor shall interfere with Lessee's
right to peaceably and quietly possess and use the Equipment during the term
thereof, subject to the terms and provisions hereof. (e) Expenses incurred by
Lessor in connection with (1) the filing or recording of real property waivers
and UCC statements, and (2) lien search reports and copies of filings with
respect to Lessee and/or the Equipment, shall be for the account of Lessor. If
Lessee fails to perform any of its obligations hereunder with respect to an
Equipment Schedule, Lessor shall have the right, but shall not be obligated, to
effect such performance, and the amount of any out of pocket and other
reasonable expenses of Lessor incurred in connection with such performance,
together with interest thereon at the Late Charge Rate, shall be payable by
Lessee upon demand. Lessor's effecting such compliance shall not be a waiver of
Lessee's default. (f) Lessee irrevocably appoints Lessor as Lessee's
attorney-in-fact (which power shall be deemed coupled with an interest) to
execute, endorse and deliver any UCC statements and any documents and checks or
drafts relating to or received in payment for any loss or damage under the
policies of insurance required by the provisions of Section 11 hereof, but only
to the extent that the same relates to the Equipment. (g) LESSOR AND LESSEE
HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO WHICH LESSEE AND/OR
LESSOR MAY BE PARTIES ARISING OUT OF OR IN ANY WAY PERTAINING TO THIS LEASE.
LESSEE AUTHORIZES LESSOR TO FILE THIS PROVISION WITH THE CLERK OR JUDGE OF ANY
COURT HEARING ANY SUCH CLAIM. IT IS HEREBY AGREED AND UNDERSTOOD THAT THIS
WAIVER CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL CLAIMS AGAINST PARTIES TO
SUCH ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS AGAINST PARTIES WHO ARE NOT
PARTIES TO THIS LEASE. THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE
BY THE PARTIES AND THE PARTIES HEREBY ACKNOWLEDGE THAT NO REPRESENTATIONS OF
FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO INDUCE THIS WAIVER OF TRIAL
BY JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS EFFECT. LESSOR AND LESSEE FURTHER
ACKNOWLEDGE THAT THEY HAVE BEEN REPRESENTED IN THE SIGNING OF THIS LEASE AND IN
THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, SELECTED OF THEIR OWN
FREE WILL, AND THAT THEY HAVE HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH
COUNSEL. (h) All notices (excluding ▇▇▇▇▇▇▇▇ and communications in the ordinary
course of business) hereunder shall be in writing, personally delivered,
delivered by overnight courier service, sent by facsimile transmission (with
confirmation of receipt), or sent by certified mail, return receipt requested,
addressed to the other party at its respective address stated below the
signature of such party or at such other address as such party shall from time
to time designate in writing to the other party; and shall be effective from the
date of receipt. (i) This Lease and all of the other Lease Documents shall not
be effective unless and until accepted by execution by an officer of Lessor at
the address, in the State of Maryland (the "State"), as set forth below the
signature of Lessor. THIS LEASE AND ALL OF THE OTHER LEASE DOCUMENTS, AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER, SHALL IN ALL
RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF
THE STATE (WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES OF THE STATE),
INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, REGARDLESS OF
THE LOCATION OF THE EQUIPMENT. The parties agree that any action or proceeding
arising out of or relating to this Lease may be commenced in any state or
Federal court in the State, and agree that a summons and complaint commencing an
action or proceeding in any such court shall be properly served and shall confer
personal jurisdiction if served personally or by certified mail to it at its
address hereinbelow set forth, or as it may provide in writing from time to
time, or as otherwise provided under the laws of the State. (j) This Lease and
all of the other Lease Documents may be executed in any number of counterparts
and by different parties hereto or thereto on separate counterparts, each of
which, when so executed and delivered, shall be an original, but all such
counterparts shall together consist of but one and the same instrument;
provided, however, that to the extent that this Lease and/or the Equipment
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 herein or therein may be created through the transfer or possession of
this Lease in and of itself without the transfer or possession of the original
of such Equipment Schedule and incorporating the Lease by reference; and no
security interest in this Lease and an Equipment Schedule may be created by the
transfer or possession of any counterpart of such Equipment Schedule other than
the original thereof, which shall be identified as the document marked
"Original" and all other counterparts shall be marked "Duplicate".
20. DEFINITIONS AND RULES OF CONSTRUCTION. (a) The following terms when
used in this Lease or in any of the Equipment Schedules have the following
meanings: (1) "applicable law" or "law": any law, rule, regulation, ordinance,
order, code, common law, interpretation, judgment, directive, decree, treaty,
injunction, writ, determination, award, permit or similar norm or decision of
any governmental authority; (2) "business day": any day, other than a Saturday,
Sunday, or legal holiday for commercial banks under the laws of the state of the
governing law of this Lease; (3) "Code" or "Uniform Commercial Code": the
Uniform Commercial Code as in effect in the State or in any other applicable
jurisdiction; and any reference to an article (including Article 2) or section
thereof shall mean the corresponding article or section (however termed) of any
such other applicable version of the Uniform Commercial Code; (4) "governmental
authority": any federal, state, county, municipal, regional or other
governmental authority, agency, board, body, instrumentality or court, in each
case, whether domestic or foreign; and (5) "person": any individual,
corporation, partnership, joint venture, or other legal entity or a governmental
authority, whether employed, hired, affiliated, owned, contracted with, or
otherwise related or unrelated to Lessee or Lessor. (b) The following terms when
used herein or in any of the Equipment Schedules shall be construed as follows:
"herein," "hereof," "hereunder," etc.: in, of, under, etc. this Lease or such
other Lease Document in which such term appears (and not merely in, of, under,
etc. the section or provision where the reference occurs); "including":
containing, embracing or involving all of the enumerated items, but not limited
to such items unless such term is followed by the words "and limited to," or
similar words; and "or": at least one, but not necessarily only one, of the
alternatives enumerated. Any defined term used in the singular preceded by "any"
indicates any number of the members of the relevant class. Any Lease Document or
other agreement or instrument referred to herein means such agreement or
instrument as supplemented and amended from time to time. Any reference to
Lessor or Lessee shall include their permitted successors and assigns. Any
reference to a law shall also mean such law as amended, superseded or replaced
from time to time. Unless otherwise expressly provided herein to the contrary,
all actions that Lessee takes or is required to take under any Lease Document
shall be taken at Lessee's sole cost and expense, and all such costs and
expenses
EKG:179726.1:3/24/98: 7:54 AM
EQUIPMENT LEASE AGREEMENT
SYNTHETIC LEASE (08/00)
8
shall constitute Claims and be covered by Section 14 hereof. To the extent
Lessor is required to give its consent or approval with respect to any matter,
the reasonableness of Lessor's withholding of such consent shall be determined
based on the
then existing circumstances; provided, that Lessor's withholding of its consent
shall be deemed reasonable for all purposes if (i) the taking of the action that
is the subject of such request, might result (in Lessor's discretion), in (A) an
impairment of Lessor's rights, title or interests hereunder or under any
Equipment Schedule or other Lease Document, or to the Equipment, or (B) expose
Lessor to any Claims, or (ii) to the extent Lessee fails to provide promptly to
Lessor any filings, certificates, opinions or indemnities specified by Lessor to
Lessee in writing.
IN WITNESS WHEREOF, the parties hereto have caused this Equipment Lease
Agreement to be duly executed, under seal, as of the day and year first above
set forth.
SUNTRUST LEASING CORPORATION ▇▇▇▇▇▇▇▇ CORPORATION
-------------------------------------------------------------- -------------------------------------------------------------
Lessor Lessee
By: [SEAL] By: [SEAL]
----------------------------------------------------- -----------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------------------- ---------------------------------------------------------
Title: Secretary Title: Assistant Treasurer
-------------------------------------------------------- --------------------------------------------------------
Address:29 W. Susquehanna Avenue Address: ▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------------- -------------------------------------------
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
---------------------------------------------------- -------------------------------------------
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
---------------------------------------------------------------------- ------------------------------------------
Attn: President Attn:
------------------------------------------------------------ ------------------------------------------
Jurisdiction of Organization: Michigan
---------------------------
Organizational # 196745
---------------------------------------
EKG:179726.1:3/24/98: 7:54 AM
EQUIPMENT LEASE AGREEMENT
SYNTHETIC LEASE (08/00)
9
--------------------------------------------------------------------------------
SUNTRUST LEASING CORPORATION
--------------------------------------------------------------------------------
EQUIPMENT SCHEDULE NO. 001
This Equipment Schedule (this "Equipment Schedule") is entered into
between SUNTRUST LEASING CORPORATION ("Lessor") and ▇▇▇▇▇▇▇▇ CORPORATION
("Lessee"), effective as of the date set forth below, pursuant to that certain
Equipment Lease Agreement dated as of September 27 , 2001, between Lessor and
Lessee (the "Lease"). Capitalized terms used without definition in this
Equipment Schedule and certain other terms that are not capitalized shall have
the meanings ascribed to them in the Lease, to the extent defined therein. The
provisions of the Lease, solely as they relate to the Equipment leased
hereunder, are hereby incorporated into and shall be deemed a part of this
Equipment Schedule. This Equipment Schedule shall be deemed a separate
instrument of lease.
1. EQUIPMENT. (a) The Equipment leased hereunder shall include the
personal property described in the schedule attached hereto and made a part
hereof.
(b) The "Total Invoice Cost" of the Equipment is equal to
$20,000,000.00.
-------------
2. TERM. Upon and after the date of execution hereof, the Equipment
shall be hereby leased by Lessor to Lessee on the terms and conditions of the
Lease, this Equipment Schedule and any other Lease Documents entered into in
connection herewith. A full term of lease with respect to said Equipment shall
commence on the date hereof and shall extend for forty-eight (48) months after
the 30th day of the month of the date hereof.
3. RENT PAYMENTS; END OF LEASE OPTION AMOUNTS. (a) During the period
from the date hereof to the 30th day of this month, the pro-rated daily rent
payment for said Equipment shall be $5,577.60 as daily rent; computed as
0.027888% of the Total Invoice Cost specified above. This pro-rated payment
shall be made on the 30th day of this month.
(b) From and after the 30th day of the month of execution
hereof, the monthly rent payment for said Equipment during the term of this
Equipment Schedule shall be $250,990.60, computed as 1.254953% of the Total
Invoice Cost specified above. Rent, and any applicable sales/use tax, payments
shall be made, in arrears, on the 30th day of the month for each month during
the term of this Equipment Schedule.
(c) Pursuant to Section 2 of the Lease, Lessee will pay the
rent, any applicable sales/use tax payments and all other amounts payable
under the Lease by mailing such amounts to Lessor at: ▇.▇. ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
(d) As an accommodation, and not as a condition to payment
(and without prejudicing the agreements made in the second sentence of Section 2
of the Lease), Lessee has requested and Lessor has agreed to submit invoices to
Lessee with respect to each of the rental installments payable under this
Equipment Schedule. Lessor will transmit each such invoice by regular mail,
addressed to Lessee at the address provided below Lessee's signature in the
Lease, deposited in the mail prior to the related payment date.
(e) For the purposes of Section 18 of the Lease the following
terms shall be deemed to be equal to the amounts referenced below:
"Fixed Purchase Price": "Residual Risk Amount":
-------------------- --------------------
original lease term: $11,648,800. (58.244% of Total Invoice Cost). $2,642,000. (13.21% of Total Invoice Cost).
First Renewal Term: $9,244,000. (46.220% of Total Invoice Cost). $1,298,000. (6.49% of Total Invoice Cost).
Second Renewal Term: $6,697,200. (33.486% of Total Invoice Cost). $1,030,000. (5.15% of Total Invoice Cost).
Third Renewal Term: $4,000,000. (20.000% of Total Invoice Cost). $ 744,000. (3.72% of Total Invoice Cost).
4. LESSEE'S CONFIRMATION. (a) Lessee hereby confirms and warrants to Lessor
that the Equipment: (i) was duly delivered to Lessee at the location specified
in Section 5 hereof; (ii) has been received, inspected and determined to be in
compliance with all applicable specifications set forth in the Supply Contract
and that the Equipment is hereby accepted for all purposes of the Lease, hereof
and of the Supply Contract; and (iii) is a part of the "Equipment" referred to
in the Lease and is taken subject to all terms and conditions therein and herein
provided. (b) Lessee acknowledges and agrees that: (i) Lessor did not select,
manufacture or supply the Equipment; (ii) Lessor acquired the Equipment in
connection with the Lease and this Equipment Schedule; and (iii) Lessee received
a copy of the Supply Contract by which Lessor acquired the Equipment before
executing this Equipment Schedule.
5. LOCATION OF EQUIPMENT. The location of the Equipment is specified on
the Schedule of Equipment attached hereto.
6. LATE CHARGE RATE; RETURN FEE. (a) The Late Charge Rate shall be one
percent per month of the amount in arrears for the period such amount remains
unpaid (provided, however, that if such rate exceeds the highest rate permitted
by applicable law, then the Late Charge Rate shall be the highest rate permitted
by applicable law). (b) The Return Fee payable pursuant to Section 2 of the
Lease is $30.00 per returned item.
7. SCHEDULE OF STIPULATED LOSS VALUES. The Schedule of Stipulated
Loss Values attached hereto is incorporated herein by reference, and shall
be applicable solely to the Equipment described in this Equipment Schedule.
8. INTENTIONALLY OMITTED.
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EQUIPMENT SCHEDULE (SYNTHETIC)
INTERIM AS PERCENT (LESSOR)
1
9. PUBLIC LIABILITY INSURANCE. The amount of public liability
insurance referenced in Section 11 of the Lease is $10,000,000.00, with
a mutually acceptable deductible.
10. INTEREST RATE PROVISION. Without prejudicing the generality of Section
10(c) of the Lease, Lessor and Lessee agree that notwithstanding any provision
to the contrary in this Equipment Schedule or any other Lease Document: (a) the
aggregate of all interest and any other charges or consideration constituting
interest, if any, under applicable interest law that is taken, reserved,
contracted for, charged or received under this Equipment Schedule or under any
other Lease Document or otherwise on or in connection with any indebtedness
shall under no circumstance exceed the maximum amount of interest allowed by the
applicable interest law; and (b) neither Lessee nor any other party liable for
the payment of any such indebtedness shall be obligated to pay the amount of
such interest to the extent that it is in excess of the maximum amount of
interest allowed by the interest law applicable to any such indebtedness.
DATE OF EXECUTION: September 27 , 2001.
----- --
SUNTRUST LEASING CORPORATION ▇▇▇▇▇▇▇▇ CORPORATION
--------------------------------------------------------------
Lessor Lessee
By: [SEAL] By: [SEAL]
----------------------------------------------------- -----------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------------------- ---------------------------------------------------------
Title: Secretary Title: Assistant Treasurer
-------------------------------------------------------- --------------------------------------------------------
THE ONE AND ONLY ORIGINAL OF THIS EQUIPMENT SCHEDULE IS MARKED "ORIGINAL" AT THE TOP OF THIS PAGE AND SHALL CONSTITUTE THE ONLY
CHATTEL PAPER ORIGINAL FOR THE PURPOSES OF ARTICLE 9 OF THE UNIFORM COMMERCIAL CODE. EACH OTHER SIGNED VERSION IS MARKED
"DUPLICATE".
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EQUIPMENT SCHEDULE (SYNTHETIC)
INTERIM AS PERCENT (LESSOR)
2