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Exhibit 10.19
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COVIA CONTRACT
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00970
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COMDISCO(R) MASTER LEASE
Comdisco, Inc. -- Lessor
MASTER LEASE AGREEMENT dated as of November 11, 1988 by and between
COMDISCO, INC. (hereinafter called "Lessor") having its principal office and
place of business at 0000 Xxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxx 00000 and Covia
Partnership (hereinafter called "Lessee") having its principal office and place
of business at 0000 Xxxx Xxxxxxx Xxxx, Xxxxxxxx, XX 00000
IN CONSIDERATION of the mutual agreements hereinafter set forth and the
payment of rent as herein provided for, the parties hereto agree as follows:
1. Property Leased.
In consideration of the rent to be paid by Lessee and the covenants and
agreements of Lessee hereinafter set forth, Lessor hereby rents, demises and
lets to Lessee all of the tangible personal property listed on each Equipment
Schedule executed, from time to time, pursuant to this Master Lease (with
respect to any Equipment Schedule, hereinafter called the "Equipment"). Each
Equipment Schedule shall be substantially in the form annexed hereto as Exhibit
A and made a part hereof, shall incorporate therein all of the terms and
conditions of this Master Lease and shall contain such additional terms and
conditions as Lessor and Lessee shall agree upon.
2. Term.
The term of this Master Lease shall commence on the date set forth above
and shall continue in effect thereafter so long as any Equipment Schedule
entered into pursuant to this Master Lease remains in effect.
The lease term for each Equipment Schedule shall commence on the first to
occur of the day on which the Equipment listed on said Equipment Schedule is
installed and approved for coverage under a prime shift maintenance contract by
the manufacturer thereof or the seventh (7th) day after delivery by Lessor if a
delay of installation and approval is caused by Lessee (hereinafter called the
"Commencement Date"); provided, however, that if the Equipment is specified as
"new" in such Equipment Schedule the date of installation of such Equipment
shall constitute the Commencement Date. The lease term shall continue for the
number of full months set forth in such Equipment Schedule (hereinafter called
the "Initial Term"), commencing on the first day of the month following the
Commencement Date (or commencing on the Commencement Date if such Date is on the
first day of the month). On the Commencement Date the Lessee will execute and
deliver to the Lessor a letter, in a form to be specified by the Lessor, which
confirms such Commencement Date.
3. Rent and Payment.
Lessee shall pay to Lessor, as rental for the Equipment during each month
of the Initial Term of any Equipment Schedule, the Monthly Rent set forth in
such Equipment Schedule, which shall be due and payable in advance on the first
day of each calendar month during such Initial Term (each such date being
hereinafter called a "Monthly Rent Payment Date"). If the Commencement Date of
any Equipment Schedule shall be other than the first day of the month, Lessee
shall make rental payments ("Interim Rent") equal to one-thirtieth of the
Monthly Rent set forth in the Equipment Schedule for each day from and including
the Commencement Date through and including the last day of the month prior to
the beginning of the Initial Term. Rent shall be paid to Lessor by check or wire
transfer so as to constitute immediately available funds at the address of
Lessor set forth above or at such other place as Lessor shall designate in
writing, or, if to an assignee of Lessor, at such place as such assignee shall
designate in writing, and shall be paid free and clear of all claims, demands or
setoffs against Lessor or such assignee. Whenever any payment (of rent or
otherwise) is not made when due hereunder, Lessee shall pay interest on such
amount at the rate of 18% per annum or the maximum allowable rate of interest
permitted by the law of the state where the Equipment is located, whichever is
less (the "Overdue Rate"), to the date of payment.
4. Selection; Warranty and Disclaimer of Warranties.
4.1 Selection. Lessee acknowledges, represents and warrants that it has
made the selection of the Equipment based on its own judgment and expressly
disclaims any reliance upon statements made by the Lessor. Lessee authorizes
Lessor to insert in each Equipment Schedule the serial number and other
identifying data of the Equipment.
4.2 Warranty and Disclaimer of Warranties. Lessor warrants to Lessee that,
so long as Lessee shall not be in default of any of the provisions of the
applicable Equipment Schedule, neither owner, Lessor, nor any assignee or
secured party of Lessor will disturb Lessee's quiet and peaceful possession of
the Equipment and Lessee's unrestricted use thereof for its intended purpose.
LESSOR MAKES NO OTHER WARRANTY, EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER,
INCLUDING, WITHOUT LIMITATION, THE DESIGN OR CONDITION OF THE EQUIPMENT, ITS
MERCHANTABILITY OR ITS FITNESS OR CAPACITY OR DURABILITY FOR ANY PARTICULAR
PURPOSE, THE QUALITY OF THE MATERIAL OR WORKMANSHIP OF THE EQUIPMENT OR
CONFORMITY OF THE EQUIPMENT TO THE PROVISIONS AND SPECIFICATIONS OF ANY PURCHASE
ORDER OR ORDERS RELATING THERETO AND, AS TO LESSOR, LESSEE LEASES THE EQUIPMENT
"AS IS". Lessor shall not be liable, to any extent whatever, for the selection,
quality, condition, merchantability, suitability, fitness, operation or
performance of the Equipment. Without limiting the generality of the foregoing,
Lessor shall not be liable to Lessee for any liability, claim, loss, damage or
expense of any kind or nature (including strict liability in tort) caused,
directly or indirectly, by the Equipment or any inadequacy thereof for any
purpose, or any deficiency or defect therein, or the use or maintenance thereof,
or any repairs, servicing or adjustments thereto; or any delay in providing or
failure to provide any part thereof, or any interruption or loss of service or
use thereof, or any loss of business, or any damage whatsoever and howsoever
caused except for any such loss or damage caused by the wilful misconduct of
Lessor, or its agents and representatives. Lessor hereby appoints Lessee as
Lessor's agent to assert, during the term of the applicable Equipment Schedule,
any right Lessor may have to enforce the manufacturer's warranties, if any;
provided, however, that Lessee shall indemnify and hold Lessor or its assignee
harmless from and against any and all claims, costs, expenses, damages, losses
and liabilities incurred or suffered by Lessor as a result of or incident to any
action by Lessee in connection therewith.
5. Title and Assignment.
5.1 Title. Nothing contained in any Equipment Schedule shall give or
convey to Lessee any right, title or interest in or to the Equipment, except as
a Lessee as set forth therein and Lessee represents and agrees that Lessee shall
hold the Equipment subject and subordinate to the rights of the owner.
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Lessor, any Assignee and any Secured Party (as defined in Section 5.3) and
Lessee shall furnish Lessor with such documentation as Lessor shall reasonably
require with respect thereto. Lessor is hereby authorized by Lessee, at Lessor's
expense, to cause this Master Lease, any Equipment Schedule or any statement or
other instrument in respect of any Equipment Schedule as may be required by law
showing the interest of Lessor, any Assignee and any Secured Party in the
Equipment to be filed and Lessee agrees to execute and deliver Uniform
Commercial Code financing statements reasonably requested by Lessor for such
purpose. Lessee shall, at its expense, protect and defend Lessor's title as well
as the interest of any Assignee and any Secured Party against all persons
claiming against or through Lessee and shall at all times keep the Equipment
free and clear from any legal process, liens or encumbrances whatsoever (except
any placed thereon by Lessor) and shall give Lessor immediate written notice
thereof and shall indemnify and hold Lessor, any Assignee and any Secured Party
harmless from and against any loss caused thereby.
5.2 Assignment, Sublease or Relocation by Lessee. Upon at least sixty (60)
days prior written notice to Lessor, Lessee may assign or sublease the Equipment
to any party, or relocate the Equipment to any location, within any state of the
continental United States which shall have in effect the Uniform Commercial
Code, provided that Lessor, any Assignee and any Secured Party, in such parties'
sole discretion, shall have approved such assignee, sublessee or location and
provided (i) that all costs of any nature whatsoever (including any additional
property taxes or other taxes and any additional expenses of insurance coverage)
resulting from any relocation, assignment or sublease shall be promptly paid by
Lessee upon presentation to Lessee of evidence supporting such cost, and (ii)
any assignment or sublease shall be made expressly subject and subordinate to
the terms of this Lease and Lessee shall assign its rights under said assignment
or sublease to Lessor, any Assignee and any Secured Party as additional
collateral and security for Lessee's obligations hereunder. If Lessee fails to
so notify Lessor and, as a result of such failure, Lessor has paid or is
required by the jurisdiction where the Equipment was originally located to
continue to pay taxes of the sort for which Lessee is responsible under Section
6.2 below, then Lessee shall reimburse Lessor for such taxes, which payment
(less Lessor's reasonable costs and expenses) will be refunded to Lessee if and
when Lessor receives a corresponding refund from said jurisdiction. In the event
of a relocation, assignment or sublease, Lessee, its assignee, or its sublease,
if any, shall cooperate with Lessor in taking all reasonable measures to protect
the title of Lessor or any Assignee and the interest of any Secured Party to and
in the Equipment. No relocation, assignment or sublease permitted hereunder
shall relieve Lessee from any of its obligations under this Lease. Lessee hereby
grants to Lessor the right and opportunity to submit or match the last proposal
for the sublease or assignment of the Equipment, and to submit a proposal for
the financing of any Equipment which is replacing Equipment leased pursuant to
this Master Lease. Each of the foregoing shall be conducted in a commercially
reasonable time frame and manner.
5.3 Assignment by Lessor. Lessee acknowledges and understands that the
terms and conditions of each Equipment Schedule have been fixed by Lessor in
anticipation of its ability to sell and assign its interest or grant a security
interest under each Equipment Schedule and the Equipment listed therein in whole
or in part to a security assignee (the "Secured Party") for the purpose of
securing a loan to the Lessor. The Lessor may also sell and assign its rights as
owner and lessor of the Equipment under any Equipment Schedule to an assignee
(the "Assignee") which may be represented by a bank or trust company acting as a
trustee (the "Owner Trustee") for the Assignee. After such assignments the term
Lessor shall mean, as the case may be, such Assignee or Owner Trustee and any
Secured Party. Notwithstanding the foregoing, any assignment by Lessor shall not
relieve Lessor of its obligations to Lessee hereunder. The Lessee hereby
consents to and shall acknowledge such assignment or assignments as shall be
designated by written notice given by Lessor to Lessee and further convenants
and agrees that:
(a) Any such Secured Party shall have and be entitled to exercise any
and all discretions, rights and powers of Lessor hereunder or under
any Equipment Schedule, but such Secured Party shall not be
obligated to perform any of the obligations of Lessor hereunder or
under any Equipment Schedule, provided, however that such Secured
Party shall not disturb Lessee's quiet and peaceful possession of
the Equipment and unrestricted use thereof for its intended purpose
during the term hereof so long as Lessee is not in default of any of
the provisions hereof and such Secured Party continues to receive
all amounts of Monthly Rent payable under such Equipment Schedule:
(b) Lessee will pay all Monthly Rent and any and all other amounts
payable by Lessee under any Equipment Schedule to such Secured
Party, notwithstanding any defense or claim of whatever nature,
whether by reason of breach of such Equipment Schedule or otherwise
which it may or might now or hereafter have as against Lessor
(Lessee reserving its right to have recourse directly against Lessor
on account of any such defense or claim); and
(c) Subject to and without impairment of Lessee's leasehold rights in
and to the Equipment, Lessee holds the Equipment for such Secured
Party to the extent of such Secured Party's rights therein.
6. Net Lease, Taxes and Fees.
6.1 Net Lease. Lessor and Lessee acknowledge and agree that each Equipment
Schedule constitutes a net lease and that Lessee's obligation to pay all Monthly
Rent and any and all amounts payable by Lessee under any Equipment Schedule
shall be absolute and unconditional and shall not be subject to any abatement,
reduction, set-off, defense, counterclaim, interruption, deferment or recoupment
for any reason whatsoever, and that such payments shall be and continue to be
payable in all events.
6.2 Taxes and Fees. Lessee covenants and agrees to pay when due or
reimburse and indemnify and hold the Lessor harmless from and against all taxes,
fees or other charges of any nature whatsoever (together with any related
interest or penalties not arising from negligence on the part of Lessor) now or
hereafter imposed or assessed during the term of each Equipment Schedule against
Lessor, Lessee or the Equipment by any Federal, state, county, or local
governmental authority upon or with respect to the Equipment or upon the
ordering, purchase, sale, ownership, delivery, leasing, possession, use,
operation, return or other disposition thereof or upon the rents, receipts or
earnings arising therefrom or upon or with respect to any Equipment Schedule
(excepting only Federal, state and local taxes based on or measured by the net
income of Lessor). Notwithstanding the foregoing, unless otherwise specified in
the Equipment Schedule, Lessor shall be responsible for the filing of all
personal property tax returns in respect of the Equipment and shall pay all
taxes indicated thereon. Lessee shall reimburse Lessor for all such taxes within
ten (10) days of receipt of Lessor's invoice therefor.
7. Care and Use, Maintenance and Repair, and Inspection by Lessor.
7.1 Care, Use and Maintenance. Lessee shall, at its sole expense, at all
times during the term of each Equipment Schedule, maintain the Equipment in good
operating order, repair, condition and appearance and protect the Equipment from
deterioration, other than normal wear and tear. Lessee shall not use the
Equipment for any purpose other than that for which it was designed. Lessee
shall, at its sole expense, enter into and maintain in force, for the term of
each Equipment Schedule, a prime shift maintenance contract with the
manufacturer of the Equipment or such other party as shall be acceptable to
Lessor, and shall provide Lessor with a copy of such contract and all
supplements thereto which are applicable to the Equipment. If Lessee has the
Equipment maintained by a party other than the manufacturer, Lessee hereby
assumes and agrees to pay any costs necessary to have the manufacturer
re-certify the Equipment at the scheduled expiration of the lease term, which
lease term shall continue upon the same terms and conditions until such
recertification has been obtained.
7.2 Alterations and Attachments. Upon prior written notice to Lessor,
Lessee may, at its expense, add or install any Upgrade (as hereinafter defined)
on the Equipment leased hereunder. For purposes hereof and all documents
relating hereto, the term "Upgrade" shall mean: (i) any accessory, equipment or
device manufactured or sold by the manufacturer of the Equipment for
installation on the Equipment and installed in compliance with said
manufacturer's installation procedures (other than those added by the
manufacturer in order to maintain the Equipment at current engineering levels),
or (ii) any other accessory, equipment or device installed on the Equipment so
long as such item does not impair the original function or use of the Equipment
and is capable of being removed without causing material damage to the
Equipment. An Upgrade shall not become an accession to the Equipment and shall
not become the property of Lessor. For purposes hereof and of all documents
relating hereto, the term "Equipment" shall not be deemed to include any such
Upgrade. At the request of Lessor, Lessee shall (and, absent such request, at
its option, Lessee may), upon expiration or termination of the Equipment
Schedule covering such Equipment, remove any such Upgrade and restore the
Equipment to its original condition (ordinary wear and tear excepted), all at
Lessee's expense, prior to returning the Equipment to Lessor. Lessee will not,
without the prior written consent of Lessor and subject to such conditions as
Lessor may impose for its protection, affix the Equipment to any real property
if, as a result thereof, the Equipment will become a fixture under applicable
law.
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7.3 Inspection by Lessor. Upon the request of Lessor, Lessee shall at
reasonable times during business hours make the Equipment available to Lessor
for inspection at the place where it is normally located and shall make Lessee's
log and maintenance records pertaining to the Equipment available to Lessor for
inspection.
8. Representations and Warranties of Lessee.
Lessee hereby represents, warrants and covenants that, with respect to the
Master Lease and each Equipment Schedule executed hereunder:
(a) The execution, delivery and performance thereof by the Lessee have
been duly authorized by all necessary corporate action.
(b) The individual executing such was duly authorized to do so.
(c) The Master Lease and each Equipment Schedule constitute legal, valid
and binding agreements of the Lessee enforceable in accordance with
their respective terms.
(d) The Equipment is personal property and when subjected to use by the
Lessee will not be or become fixtures under applicable law.
(e) Lessee shall furnish, upon request by Lessor, audited financial
statements for the most recent period.
9. Delivery and Return of Equipment.
Lessee hereby assumes the full expense of transportation and in-transit
insurance to Lessee's premises and installation thereat of the Equipment. Upon
termination (by expiration or otherwise) of each Equipment Schedule, Lessee
shall, pursuant to Lessor's instructions and at Lessee's full expense
(including, without limitation, expenses of transportation and in-transit
insurance), return the Equipment to Lessor in the same operating order, repair,
condition and appearance as when received, less normal depreciation and wear and
tear, and excepting physical loss, damage or destruction for which Lessee is not
responsible as provided in Section 12, Lessee shall return the Equipment to
Lessor at its address set forth herein or at such other address within the
continental United States as directed by Lessor.
10. Labeling.
Lessee convenants and agrees that, upon the request of Lessor, it shall
cause the Equipment to be plainly, permanently and conspicuously marked, by
stenciling or by metal tag or place affixed thereto, indicating Lessor's
interest in the Equipment. Lessee shall replace any such stenciling, tag or
place which may be removed or destroyed or become illegible. Lessee shall keep
all Equipment free from any marking or labeling which might be interpreted as a
claim of ownership thereof by Lessee or any party other than Lessor or anyone so
claiming through Lessor.
11. Indemnity.
Lessee shall and does hereby indemnify and hold Lessor, any Assignee and
any Secured Party harmless from and against any and all claims, costs, expenses,
damages and liabilities, including reasonable attorneys fees, arising out of the
ownership, selection, possession, leasing, renting, operation, control, use,
maintenance, delivery, return or other disposition of the Equipment.
Notwithstanding the foregoing, Lessee shall not be responsible under the terms
of this Section 11 to a party indemnified hereunder for any claims, costs,
expenses, damages and liabilities occasioned by the gross negligence or wilful
misconduct of such indemnified party. Lessee shall, at its own expense, carry
bodily injury and property damage liability insurance during the term of the
Master Lease in amounts and against risks customarily insured against by the
Lessee on equipment owned by it. Any amounts received by Lessor with respect to
such insurance shall be credited against the Lessee's obligations hereunder.
12. Risk of Loss.
The responsibilities of Lessee and Lessor with respect to the risk of loss
of the Equipment shall be as set forth in the Equipment Schedule.
13. Default.
13.1 Definition. The occurrence of any one or more of the following events
(herein called "Events of Default") shall constitute a default under an
Equipment Schedule:
(a) Default by Lessee in the payment of any installment of Monthly Rent
or other charge payable by Lessee under such Equipment Schedule as
and when the same becomes due and payable and such default continues
for a period of ten (10) days; or
(b) Default by Lessee in the performance of any other term, covenant or
condition of such Equipment Schedule or the inaccuracy in any
material respect of any representation or warranty made by the
Lessee in such Equipment Schedule or in any document or certificate
furnished to the Lessor in connection therewith, which default or
inaccuracy shall continue for a period of fifteen (15) days after
notice; or
(c) The making of an assignment by Lessee for the benefit of its
creditors or the admission by Lessee in writing of its inability to
pay its debts as they become due, or the insolvency of Lessee, or
the filing by Lessee of a voluntary petition in bankruptcy, or the
adjudication of Lessee as a bankrupt, or the filing by Lessee of any
petition or answer seeking for itself any reorganization,
arrangement, composition, readjustment, liquidation, dissolution, or
similar relief under any present or future statute, law or
regulation, or the filing of any answer by Lessee admitting, or the
failure by Lessee to deny, the material allegations of a petition
filed against it for any such relief, or the seeking or consenting
by Lessee to, or acquiescence by Lessee in, the appointment of any
trustee, receiver or liquidator of Lessee or of all or any
substantial part of the properties of Lessee, or the inability of
Lessee to pay its debts when due, or the commission by Lessee of any
act of bankruptcy as defined in the Federal Bankruptcy Act, as
amended; or
(d) The failure by Lessee, within sixty (60) days after the commencement
of any proceeding against Lessee seeking any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or
similar relief under any present or future statute, law or
regulation, to obtain the dismissal of such proceeding or, within
sixty (60) days after the appointment, without the consent or
acquiescence of Lessee, of any trustee, receiver or liquidator of
Lessee or of all or any substantial part of the properties of
Lessee, to vacate such appointment; or
(e) The default by Lessee under any other Equipment Schedule or other
agreement between Lessee and Lessor or its assignee or Secured Party
hereunder.
13.2 Remedies. Upon the occurrence of any one or more Events of Default,
Lessor, at its option, may (1) proceed by appropriate court action or actions
either at law or in equity to enforce performance by Lessee of the applicable
convenants and terms of the applicable Equipment Schedule, or to recover from
Lessee any and all damages or expenses, including reasonable attorneys' fees,
which Lessor shall have sustained by reason of Lessee's default in any covenant
or covenants of the applicable Equipment Schedule or on account of Lessor's
enforcement of its remedies thereunder, or (2) without notice or demand,
accelerate the balance of the monthly rentals thereafter accruing under the
applicable Equipment Schedule, which, together with all rent and other amounts
then due shall become immediately due and payable, as liquidated damages and not
as a penalty, and Lessor shall have the right to the extent permitted by law;
(i) to recover all sums so due thereunder; (ii) to retake immediate possession
of the Equipment without any process of law and for such purpose Lessor may
enter upon premises where the Equipment may be located and may remove the same
therefrom without notice, and without being liable to Lessee therefor, except
that Lessor shall be liable for damages resulting from the fault or negligence
of Lessor, Lessor's assignee or their respective agents and representatives in
any such entry or repossession; (iii) to sell, lease or otherwise dispose of all
or any portion of the Equipment, with the priviledge of becoming the purchaser
thereof, at public or private sale, for cash or on credit and without notice of
its
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intention to do so or of its doing so, in which event Lessor shall apply the
cash proceeds from any sale or other disposition (less the estimated Fair Market
Value of the Equipment at the expiration of the Initial Term or any
extension thereof), or the present value (discounted at the Overdue Rate) of the
rentals under any lease for a term not to exceed the expiration of the Initial
Term or any extension thereof (all such amounts to be called "Proceeds"
hereinafter), less all costs and expenses incurred in connection with the
recovery, repair or storage of the Equipment or the transaction itself, against
all sums due from Lessee and to the extent and in the manner permitted by law.
Lessee shall be liable to Lessor for, and Lessor may recover from Lessee, the
amount by which the Proceeds of any such transaction, less the expenses of
retaking, storing, repairing and the transaction itself, including reasonable
attorneys' fees incurred by Lessor, is less than all sums due from Lessee under
the applicable Equipment Schedule; and (iv) to pursue any other remedy permitted
by law or equity. The above remedies, to the extent permitted by law, any one of
which Lessor need not, in its discretion, exercise, shall be deemed cumulative
and may be exercised successively or concurrently. Lessee shall reimburse Lessor
for all costs and expenses incurred in connection with the enforcement of any
right or remedy under such Equipment Schedule, including reasonable attorneys'
fees. Except as set forth in this Section and to the extent permitted by
applicable law, Lessee hereby waives any rights now or hereafter conferred by
statute or otherwise which may require Lessor to sell, lease or otherwise use
any Equipment in mitigation of Lessor's damage or which may otherwise limit or
modify any of Lessor's rights or remedies. Fair Market Value of the Equipment
shall be determined on the basis of and shall be the aggregate amount which
would be obtainable at the expiration of the Initial Term or any extension
thereof in an arm's-length transaction between an informed and willing
buyer/user and an informed and willing seller under no compulsion to sell.
14. Miscellaneous.
14.1 Entire Agreement. Lessor and Lessee acknowledge that there are no
agreements or understandings, written or oral, between Lessor and Lessee with
respect to the Equipment, other than as set forth herein and in each Equipment
Schedule and that this Master Lease Agreement and each Equipment Schedule
contains the entire agreement between Lessor and Lessee with respect thereto.
Neither this Master Lease nor any Equipment Schedule may be altered, modified,
terminated or discharged except by a writing signed by the party against whom
such alteration, modification, termination or discharge is sought.
14.2 No Waiver. No omission, or delay, by Lessor at any time to enforce
any right or remedy reserved to it, or to require performance of any of the
terms, covenants or provisions hereof by Lessee at any time designated, shall be
a waiver of any such right or remedy to which Lessor is entitled, nor shall it
in any way affect the right of Lessor to enforce such provisions thereafter.
14.3 Binding Nature. Each Equipment Schedule shall be binding upon, and
shall inure to the benefit of Lessor, Lessee and their respective successors,
legal representatives and assigns, except, in the case of any Secured Party, to
the extent set forth in the Subsection 5.3 of Section 5 hereof.
14.4 Survival of Obligations. All agreements, representations and
warranties contained in this Master Lease, any Equipment Schedule or in any
document delivered pursuant hereto or in connection herewith shall be for the
benefit of Lessor and any assignee or Secured Party and shall survive the
execution and delivery of this Master Lease and the expiration or other
termination of this Master Lease.
14.5 Notices. Any notice, request or other communication to either party
by the other as provided for herein shall be given in writing and only shall be
deemed received upon the earlier of receipt or three days after mailing if
mailed postage prepaid by regular or airmail to Lessor (to the attention of
"Lease Administrator") or Lessee, as the case may be, at the address for such
party set forth in the Equipment Schedule or at such changed address as may be
subsequently submitted by written notice of either party.
14.6 Applicable Law. This Master Lease has been, and each Equipment
Schedule will have been made, executed and delivered in the State of Illinois
and shall be governed and construed for all purposes under and in accordance
with the laws of the State of Illinois.
14.7 Severability. In the event any one or more of the provisions of this
Master Lease and/or any Equipment Schedule shall for any reason be held invalid,
illegal or unenforceable, the remaining provisions of this Master Lease and/or
any such Equipment Schedule shall be unimpaired, and the invalid, illegal or
unenforceable provision shall be replaced by a mutually acceptable valid, legal
and enforceable provision, which comes closest to the intention of the parties
underlying the invalid, illegal or unenforceable provision.
14.8 Counterparts. This Master Lease and any Equipment Schedule may be
executed in any number of counterparts, each of which shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument. If Lessor grants a security interest in all or any part of an
Equipment Schedule, the Equipment covered thereby and/or sums payable
thereunder, only that counterpart Equipment Schedule marked "Secured Party's
Original" shall be effective to transfer Lessor's rights therein and all other
counterparts shall be market "Duplicate" to indicate that they are not the
"Secured Party's Original".
14.9 Nonspecified Features. If the Equipment delivered pursuant to any
Equipment Schedule contains any features not specified therein, Lessee grants
Lessor, at Lessor's option, the right to remove or deactivate any of such
features. Such removal or deactivation shall be performed by the manufacturer or
another party acceptable to Lessee, upon the request of Lessor, at a time
convenient to Lessee, provided that Lessee shall not unreasonably delay the
removal of such features.
14.10 Additional Matters.
(a) Lessee, upon execution of this Master Lease and thereafter upon
execution of each Equipment Schedule, shall provide Lessor with
certified resolutions and an opinion from Lessee's counsel addressed
to Lessor or any Secured Party with respect to the representations
and warranties set forth in subparagraphs (a) through (d) of Section
8 above and shall also supply such other documents as Lessor may
reasonably request. If Lessee shall fail to timely and properly
deliver any of the aforesaid documents within fourteen (14) days of
the execution of this Master Lease and each Equipment Schedule,
Lessor, in its discretion and notwithstanding anything to the
contrary contained in Section 2 hereof, may postpone the
commencement of the Initial Term. Lessor shall give Lessee prompt
written notice of any such postponement.
(b) Section headings are for convenience only and shall not be construed
as part of this Master Lease.
IN WITNESS WHEREOF, the parties hereto have executed this Master Lease on
or as of the day and year first above written.
COVIA PARTNERSHIP COMDISCO, INC.,
---------------------------- as Lessor
as Lessee
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxx Xxxx
----------------------- ---------------------------
XXXXX X. XXXXX Xxxxx Xxxx
Title: PRESIDENT AND CEO Title: Operations Manager
See Addendum attached hereto and made a part hereof
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DEPT. INITIAL
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MGR.
PP [Illegible]
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LAW [Illegible]
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USER
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BUYER
PP
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V.P.
PP
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COVIA'S COPY
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COVIA CONTRACT
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00970
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ADDENDUM
to the Master Lease Agreement dated as of November 11, 1988
by and between Comdisco, Inc., as Lessor,
and Covia Partnership, as Lessee
The terms and conditions of the Master Lease Agreement are hereby modified
and amended as follows:
1. Section 2. "Term."
In line 7, delete the words "in a form to be specified by the Lessor."
2. Section 3. "Rent and Payment."
After the third sentence, insert the following: "For purposes of this
Section 3, Lessee's corporate check dated and mailed so as to be received on or
prior to the due date shall constitute compliance with the requirement of
payment in immediately available funds."
In line 9, delete the words "18% per annum" and replace them with the
words "14% per annum."
3. Section 4.2 "Warranty and Disclaimer of Warranties."
In line 2, after the words "secured party of Lessor" insert the following:
"nor any other parties claiming under or through Lessor."
Add the following to the end of this section: "Lessor warrants that any
used Equipment supplied by Lessor hereunder will be in good operating conditions
and, if applicable, approved by the manufacturer for coverage under the
manufacturer's maintenance contract."
4. Section 5.1 "Title."
Delete the last sentence of this section and replace it with the
following:
"Lessee shall, at its expense, protect and defend Lessor's title as well
as the interest of any Assignee and any Secured Party against all persons
claiming against or through Lessee as a result of Lessee's acts or
omissions and shall at all times keep the Equipment free and clear from
any legal process, liens or encumbrances resulting from Lessee's acts or
omissions and shall give Lessor immediate written notice thereof and shall
indemnify and hold Lessor, any Assignee and any Secured Party harmless
from and against any loss caused thereby."
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5. Section 5.2 "Assignment, Sublease or Relocation by Lessee."
In line 3, after the words "provided that" insert the words "within thirty
(30) days of Lessee's notice."
In line 4, after the word "provided" insert the words "such approval shall
not be unreasonably withheld and provided further."
In line 5, insert the word "actually" before the word "resulting."
In line 14, delete the words "or match the last" and replace them with the
word "a."
Add the following to the end of this section: "Notwithstanding the
foregoing, Lessee may assign or sublease the Equipment to any of its partners or
subsidiaries without prior approval of Lessor, any Assignee or Secured Party;
provided, however, that no assignment or sublease shall relieve Lessee of its
obligations under the Lease."
6. Section 5.3 "Assignment by Lessor."
In line 7, delete the words "and shall acknowledge."
7. Section 6.2 "Taxes and Fees."
Delete the remainder of this section after the words "Equipment Schedule"
at the beginning of line 6 and insert the following:
"(except for taxes based on or measured by the gross or net income of
Lessor, gross receipts taxes (other than gross receipt taxes which are a
sale, use or rental tax), capital stock taxes, franchise taxes, net worth
taxes, doing business taxes, excess profit taxes, or taxes imposed in lieu
of a gross or net income tax). If a claim is made against Lessor for any
such charges, Lessor shall promptly notify Lessee in writing thereof. If
requested by Lessee, Lessor shall at Lessee's expense, take such action as
Lessee may reasonably direct with respect to such asserted liability and
shall not pay any such charges, except under protest, if protest is
necessary. If payment is made, Lessor shall, at Lessee's expense, which
expense will be reimbursed by Lessee upon Lessor's demand, take such
action as Lessee may reasonably direct to recover payment and shall, if
requested, permit Lessee in Lessor's name to file a claim or commence an
action to recover such payment. If Lessor shall receive a refund or credit
and any interest thereon for all or any part of such charges then Lessor
shall promptly pay Lessee the amount of any such charges or
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credits which are attributable to the amount paid by Lessee including any
interest received thereon. Notwithstanding the foregoing, unless otherwise
specified in the Equipment Schedule, Lessor shall be responsible for the
filing of all personal property tax returns in respect of the Equipment
and shall pay all taxes indicated thereon and Lessee shall reimburse
Lessor for all such personal property taxes within twenty (20) days of
receipt of Lessor's invoice and supporting documentation sent to the
attention of Lessee's Tax Department."
8. Section 7.1 "Care, Use and Maintenance."
In line 5, delete the words "and shall provide Lessor with a copy of such
contract and all supplements thereto which are applicable to the Equipment" and
replace them with the words "and shall certify to Lessor that the Equipment is
covered by the manufacturer's maintenance contract."
9. Section 8. "Representations and Warranties of Lessee."
In paragraph (c), place a period after the word "Lessee" and delete the
remainder of the sentence.
10. Section 9. "Delivery and Return of Equipment."
In line 1, delete the words "Lessee hereby assumes the full expense of
transportation" and replace them with the following: "Lessee hereby assumes the
full expense, if any, of transportation (provided that Lessee may specify the
method of transportation)."
In line 2, delete the words "pursuant to Lessor's instructions" and
replace them with the words "in accordance with the manufacturer's packaging and
transportation instructions."
In line 6, after the word "Lessor" insert the following: "; provided,
however, that Lessee's expense shall not be greater than that incurred by
returning the Equipment to Lessor at its Schaumburg, Illinois location."
11. Section 11. "Indemnity."
In line 2, add the following after the word "ownership": "(as it relates
to strict liability in tort only)."
In line 5, delete the words "gross negligence or wilful misconduct of such
indemnified party" and replace them with the following: "(i) negligence or
wilful misconduct of the Lessor, (ii) the gross negligence or wilful misconduct
of the Secured Party or Assignee, or (iii) as a result of the Lessor's, Secured
Party's or Assignee's dealings and contracts with third parties
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8
not arising from this Master Lease."
12. Section 13.1 "Definition."
In line 2 of paragraph (a), after the words "ten (10) days" insert the
words "after written notice."
In line 3 of paragraph (b), before the word "notice" insert the word
"written."
13. Section 13.2 "Remedies."
In line 11, after the words "private sale" insert the words "and in a
commercially reasonable manner."
Delete the penultimate sentence of this section in its entirety.
Add the following to the end of this section: "In no event, shall the
exercise of Lessor's remedies hereunder result in the Lessee becoming obligated
to pay an amount greater than the aggregate remaining rentals due under the
lease plus Lessor's reasonable fees and expenses to recover the payment of said
rentals."
14. Section 14.9 "Nonspecified Features."
In line 2, after the words "at Lessor's option" insert the words "and
expense."
15. Section 14.10 "Additional Matters."
In lines 1 and 2 of paragraph (a), delete the words "certified
resolutions."
Add the following to the end of this section: "Notwithstanding the
foregoing, Lessee shall only be required to provide an opinion of counsel for
Equipment Schedules with aggregate rentals of $5 million or more."
COVIA PARTNERSHIP COMDISCO, INC.
as Lessee as Lessor
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxx Xxxx
--------------------------- ---------------------------
XXXXX X. XXXXX Xxxxx Xxxx
Title: PRESIDENT AND CEO Title: Operations Manager
HSH/PD
11/16/88
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