EXHIBIT 99.1
MASTER LEASE AGREEMENT
dated as of June 19, 1995,
by and between
WILMINGTON TRUST COMPANY,
NOT INDIVIDUALLY BUT SOLELY AS TRUSTEE
as Lessor
and
MICRUS,
as Lessee
MASTER LEASE AGREEMENT
TABLE OF CONTENTS Page
I. LEASING . . . . . . . . . . . . 1
II. TERM, RENT AND PAYMENT . . 2
III. TAXES. . . . . . . . . . . 2
IV. LIENS. . . . . . . . . . . 3
V. QUIET ENJOYMENT . . . . . . . . 3
VI. PERSONAL PROPERTY. . . . . 3
VII. DELIVERY, OPERATION, MAINTENANCE AND REPORTING 3
VIII. RELOCATION. . . . . . . . 4
IX. MODIFICATIONS. . . . . . . 4
X. SUBSTITUTION OF ITEMS . . . . . 6
XI. LESSEE ASSIGNMENT AND SUBLEASE 6
XII. INSPECTION AND MARKING . . 8
XIII. STIPULATED LOSS VALUE. . . 8
XIV. LOSS OR DAMAGE . . . . . . 8
XV. INSURANCE. . . . . . . . . 9
XVI. RETURN OF EQUIPMENT. . . . 9
XVII. LEASE DEFAULT. . . . . . . 9
XVIII. LESSOR ASSIGNMENT. . . . . 11
XIX. NET LEASE; NO SET-OFF, ETC. 12
XX. INDEMNIFICATION. . . . . . 12
XXI. DISCLAIMER . . . . . . . . 13
XXII. REPRESENTATIONS AND WARRANTIES OF LESSEE . . . . . 13
XXIII. OWNERSHIP FOR TAX PURPOSES; GRANT OF SECURITY INTEREST;
USURY SAVINGS. . . . . . . . . 14
XXIV. EARLY TERMINATION. . . . . 15
XXV. END OF BASIC TERM LEASE OPTIONS 16
(a) Renewal. . . . . . . . . . 17
(b) Return . . . . . . . . .. 17
(c) Purchase . . . . . . . . 18
(d) Notice of Election . . . 18
XXVI. END OF RENEWAL TERM LEASE OPTIONS 18
(a) Extension. . . . . . . . . 19
(b Return . . . . . . . . . 19
(c) Purchase . . . . . . . .. 20
(d) Notice of Election . . . . 20
XXVII. MISCELLANEOUS. . . . . . . 21
XXVIII. CHOICE OF LAW; JURISDICTION 23
XXIX. CHATTEL PAPER. . . . . . . 23
XXX. SCOPE OF LIABILITY . . . . 23
XXXI. LIMITATION OF LIABILITY. . 23
EXHIBITS
Xx. 0 - Xxxxxxxxxx Xxxxxxxxxx
Xx. 0 - Xxxxxxxx Order Assignment and Consent
No. 3 - Letter of Credit Agreement
Xx. 0 - Xxxxxxxxx Xxxxxxxx
Xx. 0 - XXX Guaranty
No. 6 - Real Property Waiver
No. 7 - Xxxx of Sale
MASTER LEASE AGREEMENT
THIS MASTER LEASE AGREEMENT, dated as of the 19th day of June,
1995 ("Agreement"), between WILMINGTON TRUST COMPANY, not
individually but solely as Trustee (the "Trustee") pursuant to
that certain Equipment Trust Agreement dated as of June, 1995 (the
"Trust Agreement"), with General Electric Capital Corporation,
with an office at Xxxxxx Square North, 0000 Xxxxx Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000 (hereinafter called, together with its
successors and assigns, if any, "Lessor"), and MICRUS, a New York
general partnership with its mailing address and chief place of
business at 0000 Xxxxx 00, Xxx 00-X, Xxxxxxxx Xxxxxxxx, Xxx Xxxx
00000 (hereinafter called "Lessee").
WITNESSETH:
I. LEASING:
(a) Subject to the terms and conditions set forth below, Lessor
agrees to lease to Lessee, and Lessee agrees to lease from Lessor,
the equipment ("Equipment") described in Annex A to any schedule
hereto ("Schedule"). Terms defined in a Schedule and not
otherwise defined herein shall have the meanings ascribed to them
in such Schedule.
(b) The obligation of Lessor to purchase Equipment from the
manufacturer or supplier thereof ("Supplier") and to lease the
same to Lessee under any Schedule shall be subject to receipt by
Lessor, prior to the Lease Commencement Date (with respect to such
Equipment), of each of the following documents in form and
substance satisfactory to Lessor: (i) a Schedule relating to the
Equipment then to be leased hereunder, (ii) a Purchase Order
Assignment and Consent in substantially the form attached hereto
as Exhibit No. 2, unless the item of the Equipment (an "Item")
shall have been delivered, in which case Lessor shall receive a
Xxxx of Sale in substantially the form attached hereto as Exhibit
No. 7 with respect to such Item, (iii) evidence of insurance which
complies with the requirements of Section XV, (iv) a Corporate
Guaranty in substantially the form attached hereto as Exhibit No.
3 (the "Guaranty"), duly executed by Cirrus Logic, Inc.
("Guarantor"), (v) a Letter of Credit Agreement in substantially
the form attached hereto as Exhibit No. 4 (the "Letter of Credit
Agreement"), duly executed by Guarantor, (vi) the Letter of Credit
pursuant to the Letter of Credit Agreement, (vii) a Real Property
Waiver in substantially the form attached hereto as Exhibit No.
6, duly executed by each holder of an interest in the Location (as
such term is hereinafter defined) where the Equipment will be
located, (viii) a Certificate of Delivery (in the form of Annex F
to the applicable Schedule) with respect to such Item, and (ix)
such other documents as Lessor may reasonably request. As a
further condition to such obligations of Lessor, Lessee shall
execute and deliver to Lessor a Certificate of Acceptance (in the
form of Annex B to the applicable Schedule) covering such
Equipment (1) concurrently with delivery of such Equipment if the
purchase order with the Supplier does not provide for a period of
testing after delivery; or (2) within sixty (60) days after
delivery of such Equipment (but not later than December 29, 1995)
if the purchase order with the Supplier provides for a period of
testing after delivery. Lessor hereby appoints Lessee its agent
for inspection and acceptance of the Equipment from the Supplier.
Upon execution by Lessee of any Certificate of Acceptance, the
Equipment described thereon shall be deemed to have been delivered
to, and irrevocably accepted by, Lessee for lease hereunder.
(c) Each funding under this Agreement shall be in an amount not
less than Ten Million Dollars ($10,000,000.00) except the last
funding which shall cover any residual amount, and there shall be
no more than six (6) fundings in the aggregate. The aggregate
amount of all fundings under this Agreement shall not exceed
Seventy Million Dollars ($70,000,000.00). The composition of the
Equipment described in Annex A to each Schedule shall reasonably
be satisfactory to Lessor.
II. TERM, RENT AND PAYMENT:
(a) Lessee's right to use the Equipment shall commence on the
date of execution by Lessee of the Certificate of Delivery for
such Equipment ("Lease Commencement Date"). The Basic Term
Commencement Date shall be, and the rent payable hereunder (the
"Rent") shall commence on, the first day of the calendar month
next following the date that Lessee executes and delivers a
Certificate of Acceptance with respect to all of the Items of
Equipment listed on a Schedule. The term of this Agreement shall
be the period specified in the applicable Schedule. If any term
is extended, the word "Term" shall be deemed to refer to all
extended terms, and all provisions of this Agreement shall apply
during any extended terms, except as may be otherwise specifically
provided in writing.
(b) Rent shall be paid to Lessor by wire transfer of immediately
available funds to Lessor's Servicing Agent, General Electric
Capital Corporation (the "Servicing Agent") at: Bankers Trust Xxx
Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Account No. 00-000-000, ABA No.
000-000-000, or to such other account as Lessor may direct in
writing; and shall be effective upon receipt. Payments of Rent
shall be in the amount set forth in, and due in accordance with,
the provisions of the applicable Schedule. In no event shall any
Rent payments be refunded to Lessee.
III. TAXES:
Lessee shall report (to the extent that it is legally
permissible) and pay promptly all taxes, fees and assessments due,
imposed, assessed or levied against any Equipment (or the
purchase, ownership, delivery, leasing, possession, use or
operation thereof), this Agreement (or any rentals or receipts
hereunder), any Schedule, Lessor or Lessee by any United States
Federal, state or local government or taxing authority during or
related to the term of this Agreement, including, without
limitation, all license and registration fees, and all sales, use,
personal property, excise, stamp or other taxes, imposts, duties
and charges, together with any penalties, fines or interest
thereon, except that Lessee shall have no liability for taxes
imposed (a) by the United States of America or any state or
political subdivision thereof which are on or measured by the net
or gross income or net or gross receipts of Lessor or which are
characterized as franchise, net worth or shareholder's capital
taxes or which are expressly in substitution for, or relieve
Lessor from, any of the foregoing taxes (in each case other than
sales, use, value-added, license, property or similar taxes), (b)
by reason of the fact that Lessor shall not be an entity organized
under the laws of the United States of America or any state
thereof, (c) on or in connection with any voluntary transfer,
assignment or disposition by Lessor of the Equipment or any part
thereof or any interest arising hereunder or under any related
document (other than a transfer pursuant to the exercise by Lessor
of remedies under this Agreement) or any involuntary transfer,
assignment or disposition by Lessor of any such item or interest
resulting from any bankruptcy or other proceedings for the relief
of debtors involving Lessor, or (d) while Lessee shall be
contesting such taxes (all such taxes, fees and assessments for
which Lessee shall have liability under this Section III being
hereinafter called "Taxes"). Lessee shall (i) reimburse Lessor
upon receipt of written request for reimbursement for any Taxes
charged to or assessed against Lessor, (ii) on request of Lessor,
submit to Lessor written evidence of Lessee's payment of Taxes,
(iii) on all reports or returns show the ownership of the
Equipment by Lessee, and (iv) on request of Lessor, send a copy
thereof to Lessor. Lessor shall give Lessee prompt notice if it
shall receive any claim for Taxes or if it shall determine that
any Taxes shall be payable and, at the request and expense of
Lessee, Lessor shall contest such Taxes so long as such contest
shall not involve any material risk of forfeiture of the Equipment
(unless Lessee shall have provided security against such risk in a
manner reasonably satisfactory to Lessor). For purposes of this
Section III, the term "Lessor" shall include any person who holds
a beneficial interest in Lessor.
IV. LIENS:
(a) Lessee shall not directly or indirectly create, incur,
assume or suffer to exist any lien on or with respect to the
Equipment except Permitted Liens. As used herein, "Permitted
Liens" shall mean liens which are (i) the Agreement, (ii) the
rights of any sublessee or operator permitted by the terms of this
Agreement, (iii) those asserted by persons claiming by or through
Lessor, (iv) a security interest in favor of the New York State
Urban Development Corporation, which security interest shall be
subject and subordinate to the interest of Lessor in the Equipment
(the "New York State Lien"), (v) liens for fees, taxes, levies,
imposts, duties or other governmental charges of any kind which
are not yet delinquent or are being contested in good faith by
appropriate proceedings which suspend the collection thereof, (vi)
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,
and (vii) liens arising out of any judgments or awards against
Lessee which have been adequately bonded to protect Lessor's
interests or with respect to which a stay of execution has been
obtained pending an appeal or proceeding for review.
(b) Lessee will promptly notify Lessor thereof and, at Lessee's
own expense, take such action as may be necessary duly to
discharge any such lien other than Permitted Liens.
V.QUIET ENJOYMENT:
Notwithstanding any other provision of this Agreement, so long as
no Material Lease Default shall have occurred and be continuing,
as between Lessee and Lessor, Lessee shall have the exclusive
rights to possession and control of all the Equipment and neither
Lessor nor any person acting or claiming through Lessor will take
any action that shall interfere with the peaceful and quiet
enjoyment of the use or nonuse of any item of the Equipment (an
"Item") by Lessee, and Lessee shall have the right to use or not
use such Item in its sole discretion (but, in all events, shall be
required to maintain the Equipment as specified herein). The
foregoing is not intended to limit the inspection rights and the
rights in connection with a return of the Items granted by Lessee
hereunder. As used herein, "Material Lease Default" shall mean
any Lease Default (as hereinafter defined) other than a Lease
Default resulting pursuant to Section XVII(a)(3) of this
Agreement.
VI. PERSONAL PROPERTY:
Lessee and Lessor agree for the purposes of this Agreement that
the Items and every part thereof and title thereto are and shall
be considered as and shall remain personal and not real property
to all persons and for all purposes.
VII. DELIVERY, OPERATION, MAINTENANCE AND REPORTING:
(a) The Equipment shall be shipped directly from the Supplier to
Lessee.
(b) Lessee shall not use any Item or authorize any third party
to use any Item in either case, in breach of any applicable laws
(other than applicable laws as to which noncompliance would not
adversely affect the business, operations or properties of Lessee
and so long as such noncompliance shall not involve any material
danger of the sale, forfeiture or loss of such Item or the
imposition of any criminal liability on Lessor).
(c) Lessee at its own expense shall at all times during the Term
applicable to each Item maintain such Item in accordance with good
commercial maintenance standards and practices followed from time
to time by Lessee and International Business Machines Corporation
("IBM") in the operation and maintenance of similar kinds of
properties owned or leased by it. Lessee shall keep each such
Item fit for its intended use, in good and efficient working order
(ordinary wear and tear excepted), and in as good condition
(ordinary wear and tear excepted) as on the Lease Commencement
Date for such Item of Equipment.
(d) Lessee will promptly report to Lessor in writing if any Item
of the Equipment is lost or damaged where the estimated repair
costs would exceed One Hundred Thousand Dollars ($100,000.00) or
is otherwise involved in an accident causing serious personal
injury or significant property damage.
VIII. RELOCATION:
For purposes of this Agreement, the term "Location" shall mean
any building or buildings owned and/or operated by Lessee,
Guarantor or IBM, or any of their solvent subsidiaries,
collectively referred to by such party as a "site". The initial
Location for the Equipment leased under this Agreement is the IBM
East Fishkill site which incorporates the Xxxxxx Valley Research
Park. Lessee may not relocate any of the Items from the initial
Location without Lessor's prior written consent (which shall not
unreasonably be withheld) unless the following conditions are
satisfied:
(a) the Item is relocated to a Location located in the
contiguous Continental United States of America and the owner of
the Location has provided Lessor with the appropriate landlord
waiver;
(b) Lessee shall have provided Lessor with written notice of the
intention to relocate such Items in accordance with the terms
hereof at least ten (10) Business Days prior to the date such
relocation is commenced;
(c) no Material Lease Default shall have occurred and be
continuing;
(d) all reasonable out-of-pocket costs and expenses incurred by
Lessor in connection with such relocation shall be paid by
Lessee;
(e) the Equipment is located at not more than three (3)
Locations; and
(f) Lessee executes and delivers to Lessor such documents and
instruments as reasonably may be required by Lessor in connection
with such relocation of the Equipment, including (without
limitation) Uniform Commercial Code financing statements to be
filed at Lessee's expense.
If Lessee moves any Item to a different building within a
Location, promptly thereafter Lessee shall deliver to Lessor an
itemization identifying the specific building to which such Item
was moved.
IX. MODIFICATIONS:
(a) Lessee, at its own expense from time to time, may make any
modification to any Item that Lessee may deem desirable in the
conduct of its business if Lessee complies with all applicable
laws relating thereto; provided, however, that Lessee shall not
have the right to make any such modification that could materially
impair such Item from being operated as designed or diminish the
value, utility or remaining useful life of such Item to an
independent third-party user.
(b) Title to each modification shall vest as follows:
(i) in the case of each modification for which Lessor shall
have provided financing of the cost of such modification effective
on the date such modification shall have been incorporated into
such Item, Lessor shall acquire title to such modification without
further act;
(ii) in the case of each modification for which Lessor shall
not have provided financing of the cost of such modification,
Lessee shall retain title to such modification; and
(iii) notwithstanding subparagraph (ii) above, in the
case of modifications which remain upon return of the Item to
Lessor at the end of the Term applicable to an Item so modified,
title to such modifications shall vest in Lessor at the end of the
Term applicable to such Item at no cost to Lessor and without
further action by Lessee; provided, however, that Lessee shall
take such actions as reasonably may be required by Lessor to
evidence the transfer of title.
Immediately upon title to a modification vesting in Lessor
pursuant to Paragraph (b)(i) of this Section, such modification
shall, without further act, become subject to this Agreement and
be deemed part of the applicable Item for all purposes.
Modifications title to which remains in Lessee pursuant to this
Section shall not be deemed a part of the applicable Item and
shall not be subject to this Agreement.
(c) Lessee may request Lessor to finance the cost of any
modification (a "Modification Financing"), on terms acceptable to
Lessee and Lessor. Lessor shall comply with any such request
subject to the following conditions precedent to Lessor's
obligation:
(i) there shall have been no material adverse change in the
business and financial condition of Guarantor;
(ii) no Material Lease Default shall have occurred and be
continuing;
(iii) all governmental actions related to Lessee and the
Item subject to the modification required to effect the
Modification Financing shall have been obtained; and
(iv) such request is approved in writing by General
Electrical Capital Corporation and the other Participants (as such
term is hereinafter defined), including satisfaction of each such
person's underwriting criteria and approval of the proposed
modification.
(d) Subject to compliance with applicable law and so long as no
Material Lease Default shall have occurred and be continuing, if
Lessor and Lessee cannot agree on the terms of a proposed
Modification Financing, Lessee may purchase (upon sixty (60) days'
notice to Lessor, on the Rent Payment Date specified in such
notice) the Item which was to have been modified at a purchase
price equal to the Stipulated Loss Value of such Item computed as
of such Rent Payment Date plus any accrued Rent and other charges
hereunder due with respect to such Item as of such Rent Payment
Date.
(e) Subject to compliance with applicable law and so long as no
Material Lease Default shall have occurred and be continuing,
Lessee may remove, at its own expense, any modification to which
Lessee shall have title as provided in Paragraph (b) above;
provided, that, unless Lessee shall have given notice of its
desire to purchase such Item, at its own expense and prior to the
end of the Term applicable to the Item subject to such
modification, Lessee shall repair any damage to such Item caused
by such removal, and such Item remains in the condition required
hereunder.
X. SUBSTITUTION OF ITEMS:
Provided that no Material Lease Default shall have occurred and
be continuing, at Lessee's expense, Lessee may at any time
substitute a comparable Item of the Equipment for any Item (a
"Substituted Item") in accordance with the terms of this Section.
On a quarterly basis, Lessee shall notify Lessor of all
substitutions made during the preceding quarter. At such time as
the aggregate original Capitalized Lessor's Cost of all
Substituted Items (other than Items replaced pursuant to Section
XIII(a) hereof) exceeds twenty percent (20%) of the aggregate
original Capitalized Lessor's Cost of all Equipment leased
hereunder, Lessee's option to substitute additional Items shall be
subject to Lessor's prior written consent (which consent shall not
unreasonably be withheld). If Lessee shall elect to substitute an
Item of the Equipment pursuant hereto, Lessee shall, at its sole
cost and expense, convey to Lessor a comparable item of equipment
(a "Replacement Item"), free and clear of all liens other than
Permitted Liens, that has at least the value, utility and
remaining useful life and is in as good operating condition as the
Substituted Item, assuming that the Substituted Item had been
maintained in accordance with this Agreement. In addition, Lessee
shall pay to the Servicing Agent an administrative fee of Three
Thousand Dollars ($3,000.00) per notice of substitution (provided,
however, that such administrative fee shall not exceed Twelve
Thousand Dollars ($12,000.00) per calendar year), and Lessee shall
execute and deliver to Lessor such documents and instruments as
reasonably may be required by Lessor in connection with such
replacement, including (without limitation) Uniform Commercial
Code financing statements to be filed at Lessee's expense. Upon
compliance by Lessee with the terms of the two (2) preceding
sentences, Lessor will transfer to Lessee, on an AS IS BASIS (as
hereinafter defined) all of Lessor's interest in and to in such
Substituted Item. Lessor shall not be required to make and may
specifically disclaim any representation or warranty as to the
condition of such Substituted Item and other matters (except that
Lessor shall warrant that it has conveyed whatever interest it
received in the Substituted Item 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 Substituted
Item. Lessee will be subrogated to all claims of Lessor, if any,
against third parties to the extent the same relate to physical
damage to or loss of such Substituted Item, and such Substituted
Item shall no longer be subject to this Agreement. For all
purposes hereof, the Replacement Item so substituted shall after
such transfer be part of the property leased hereunder and be an
"Item". No such substitution shall result in any change in Rent.
XI. LESSEE ASSIGNMENT AND SUBLEASE:
(a) Lessee shall have and retain throughout the Term with
respect to any Item control over the operation and use of such
Item, and may, so long as no Lease Default shall have occurred and
be continuing, without the consent of Lessor, assign its interest
in this Agreement or sublease, license, transfer control of, or
permit any other person to use, all or any part of any Item or
Items during the Term, subject to the following terms and
conditions:
(i) Lessee shall remain primarily liable to Lessor for the
performance of all the terms of this Agreement to the same extent
as if such assignment, sublease or arrangement had not occurred
and the Guaranty shall remain in full force and effect against
Guarantor;
(ii) such assignment, sublease or arrangement shall be in
compliance with all applicable laws;
(iii) such assignment, sublease or arrangement as to any
Item shall not extend beyond the stated Term with respect to such
Item as then in effect for such Item, and any rights created
thereby in an Item shall be fully subject and subordinate to this
Agreement;
(iv) such assignment, sublease or arrangement shall not
subject Lessor to any regulation by any governmental agency;
(v) such assignment, sublease or arrangement shall be to
Guarantor or to a solvent affiliate of Lessee, Guarantor or IBM,
organized under the laws of any state of, and located in, the
United States;
(vi) Lessee shall have given prior written notice to Lessor
of any such assignment, sublease or arrangement;
(vii) Lessee shall obtain and deliver to Lessor such
Uniform Commercial Code financing statements executed by the
assignee or sublessee and Lessee, as reasonably may be required by
Lessor, to be filed at Lessee's expense; and
(viii) all reasonable costs and expenses (including
attorney's fees and expenses) incurred by Lessor in connection
with such assignment, sublease or arrangement shall be paid by
Lessee.
Lessee may make any such assignment, sublease or arrangement to a
person other than those persons listed above provided such person
is organized under the laws of any state of, and located in, the
United States and is not a non-profit, tax-exempt entity; and
provided further that such assignment, sublease or arrangement
complies with subparagraphs (i) through (iv) and (vi) through
(viii) above, with Lessor's prior written consent, which consent
shall not unreasonably be withheld.
Notwithstanding the foregoing, if Guarantor, IBM or their
subsidiaries who are partners in Lessee decide to dissolve Lessee,
Lessee may assign its leasehold interest in this Agreement in its
entirety to Guarantor, IBM or a solvent subsidiary of either
thereof, or to a solvent general partnership of which IBM or a
solvent subsidiary of IBM is the managing general partner;
provided, that (1) the Guaranty will survive any such assignment
and remains in full force and effect against Guarantor, and (2)
subparagraphs (ii), (iii), (iv), (vi) and (vii) above shall be
complied with.
(b) Lessee shall not consolidate or merge into any person or
sell, transfer, convey or lease all or substantially all its
properties or assets as an entirety to any Person, unless:
(i) the successor entity formed by such consolidation or
into which it is merged or the successor entity that acquires by
conveyance, transfer or lease all or substantially all its assets
as an entirety, shall be organized under the laws of the United
States of America, a state thereof or the District of Columbia,
shall be authorized under all applicable laws to operate the
Equipment and perform its obligations under this Agreement and all
related documents (the "Operative Documents") to the same extent
as Lessee and (at Lessee's expense) shall deliver to Lessor an
opinion of counsel reasonably satisfactory in form and substance
to the effect that the obligations of Lessee hereunder have been
assumed by the successor entity by operation of law without any
further act by such successor entity, or an agreement in form and
substance reasonably satisfactory to Lessor containing an
assumption by such successor entity of the due and punctual
performance of each covenant and condition of the Operative
Documents to be performed or observed by Lessee;
(ii) immediately after giving effect to such transaction, no
Material Lease Default shall have occurred and be continuing; and
(iii) the Guaranty shall remain in full force and effect
against Guarantor and applicable to the successor.
Upon any such consolidation or merger, or any sale, conveyance,
transfer or lease of substantially all the assets of Lessee in
accordance with this Section, the successor entity formed by such
consolidation or into which the Lessee shall be merged or to which
such sale, conveyance, transfer or lease shall be made, shall
succeed to, and be substituted for, and may exercise every right
and power and shall be subject to, each and every obligation of
Lessee under the Operative Documents to which it is a party with
the same effect as if such successor corporation had been named as
Lessee therein.
(c) The dissolution of Lessee shall not cause this Agreement to
terminate, or otherwise constitute a Lease Default, so long as,
prior to the effective date of such dissolution, Lessee shall have
complied with Paragraph (b) of this Section (whereupon the
assignee of Lessee's rights thereunder shall become Lessee for all
purposes hereunder and under the other Operative Documents).
XII. INSPECTION AND MARKING:
Subject to Lessee's reasonable standard security procedures and
operational requirements), during the normal business hours of
Lessee, Lessor may (at its own expense), upon reasonable prior
notice, inspect the Equipment. Lessee shall affix to any Item,
according to Lessor's instructions, any reasonable identifying
labels, plates or tags supplied by Lessor which do not interfere
with such Item's operation.
XIII. STIPULATED LOSS VALUE:
Lessee shall promptly and fully notify Lessor in writing if any
Item of Equipment shall be or become, lost, stolen, destroyed,
irreparably damaged in the determination of Lessee, or permanently
rendered unfit for use from any cause whatsoever (such occurrences
being hereinafter called "Casualty Occurrences"). On the Rent
Payment Date next succeeding a Casualty Occurrence (the "Payment
Date"), Lessee shall either (as selected by Lessee):
(a) replace the Item of Equipment having suffered the Casualty
Occurrence as provided in Section X hereof; or
(b) pay Lessor the sum of (x) the Stipulated Loss Value of such
Item calculated in accordance with Annex C to the applicable
Schedule as of the Rent Payment Date next following such Casualty
Occurrence ("Calculation Date"); and (y) all rental and other
amounts which are due hereunder as of the Payment Date. Upon
payment of all sums due hereunder, the term of this lease as to
such Item shall terminate and (except in the case (i) of the loss,
theft or complete destruction of such unit, or (ii) where the
insurer requires possession of the damaged unit), Lessee shall be
entitled to recover possession of such unit.
XIV. LOSS OR DAMAGE:
Lessee hereby assumes and shall bear the entire risk of any loss,
theft, damage to, or destruction of, any Item of Equipment from
any cause whatsoever from the Lease Commencement Date.
XV. INSURANCE:
Lessee agrees, at its own expense, to keep all Equipment insured
for such amounts as specified in Paragraph D of the Equipment
Schedule and against such hazards as Lessor may require,
including, but not limited to, insurance for damage to or loss of
such Equipment and liability coverage for personal injuries, death
or property damage, with Lessor named as additional insured and
with a loss payable clause in favor of Lessor, as its interest may
appear, with respect to all losses in excess of One Hundred
Thousand Dollars ($100,000.00), irrespective of any breach of
warranty or other act or omission of Lessee. Such policies may
include such deductibles or self-insured retentions as are
acceptable to Lessor. All such policies shall be with companies,
and on terms, reasonably satisfactory to Lessor. Lessee agrees to
deliver to Lessor evidence of insurance satisfactory to Lessor
and, upon Lessor's determination that such insurance is
satisfactory to it, Lessor shall certify to Lessee that such
insurance is satisfactory to Lessor. No insurance shall be
subject to any co-insurance clause. During the existence of a
Lease Default hereunder, Lessee hereby appoints Lessor as Lessee's
attorney-in-fact to make proof of loss and claim for insurance,
and to make adjustments with insurers and to receive payment of
and execute or endorse all documents, checks or drafts in
connection with payments made as a result of such insurance
policies. Any expense of Lessor in adjusting or collecting
insurance shall be borne by Lessee. Lessee will not make
adjustments with insurers except (i) with respect to claims for
damage to any Item of Equipment where the repair costs do not
exceed One Hundred Thousand Dollars ($100,000.00), or (ii) with
Lessor's written consent. Said policies shall provide that the
insurance may not be altered or cancelled by the insurer until
after thirty (30) days written notice to Lessor. Lessee may, at
its option, apply proceeds of insurance not in excess of One
Hundred Thousand Dollars ($100,000.00), in whole or in part, to
(i) repair or replace Equipment or any portion thereof, or (ii)
satisfy any obligation of Lessee to Lessor hereunder. Provided
that no Material Lease Default shall then have occurred and be
continuing, Lessor shall apply proceeds of insurance in excess of
One Hundred Thousand Dollars ($100,000.00), in whole or in part,
as elected by Lessee pursuant to Section XIII hereof, to (i)
repair or replace Equipment or any portion thereof, or (ii)
satisfy any obligation of Lessee to Lessor hereunder.
XVI. RETURN OF EQUIPMENT:
Upon any expiration or termination of this Agreement or any
Schedule, unless Lessee shall have exercised its early termination
option pursuant to Section XXIV hereof, or its extension option
pursuant to Section XXVI(a) hereof, or its renewal option pursuant
to Section XXV(a), hereof, or its purchase option pursuant to
Section XXV(c) or Section XXVI(c) hereof, Lessee shall promptly,
at its own cost and expense: (i) perform any testing and repairs
required to place the affected Items of Equipment in the same
condition and appearance as when received by Lessee (ordinary wear
and tear excepted) and in good working order for their originally
intended purpose; (ii) if deinstallation, disassembly or crating
is required, cause such Items to be deinstalled, disassembled and
crated by qualified personnel of Lessee or IBM, or by an
authorized manufacturer's representative or such other service
person as is satisfactory to Lessor; and (iii) within ten (10)
days after such expiration or termination, ship such Items, free
and clear of all liens and encumbrances (other than the New York
State Lien), to a location within the forty-eight (48) contiguous
continental United States as Lessor shall direct; and Lessee shall
provide, at its expense, transit insurance payable to Lessor for
the Equipment in the amount of the then Stipulated Loss Value of
the Equipment.
XVII. LEASE DEFAULT:
(a) Lessor may in writing declare this Agreement in default
("Lease Default") if: (1) Lessee breaches its obligation to pay
Rent when due hereunder and fails to cure the breach within ten
(10) days; (2) Lessee breaches its obligation to pay any sum
(other than Rent) when due and fails to cure that breach within
five (5) days after written notice thereof; (3) Lessee breaches
any of its insurance obligations under Section XV; (4) Lessee
breaches any of its other obligations hereunder and fails to cure
that breach within thirty (30) days after written notice thereof;
provided, however, that if such breach (A) is curable, (B) cannot
be remedied within the thirty (30) day period, (C) Lessee
commences reasonable efforts to effect such remedy within the
thirty (30) day period and diligently pursues such efforts, and
(D) does not involve any substantial danger of the sale,
forfeiture or loss of the Equipment or of Lessor's interest
therein, then Lessee shall have an additional period of sixty (60)
days to effect such remedy); (5) any representation or warranty
made by Lessee in connection with this Agreement shall be false or
misleading when made in any material respect; (6) Lessee becomes
insolvent or ceases to do business as a going concern (unless the
provisions of Section XI(c) hereof are satisfied); (7) any
Equipment is illegally used; (8) a petition is filed by Lessee
under any bankruptcy or insolvency laws; (9) a petition is filed
against Lessee under any bankruptcy or insolvency laws and is not
dismissed within sixty (60) days; (10) Lessee shall have
terminated its existence as a general partnership, 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 the provisions of Section XI hereof are
satisfied or not less than sixty (60) days prior to such Event:
(x) such person is organized and existing under the laws of the
United States or any state, and executes and delivers to Lessor an
agreement containing an effective assumption by such person of the
due and punctual performance of this Lease; and (y) Lessor is
reasonably satisfied as to the creditworthiness of such person; or
(11) subject to the provisions set forth in Paragraph (b) of this
Section, there occurs a default under Section 6(b)(2) of the
Guaranty. Such declaration shall apply to all Schedules except as
specifically excepted by Lessor.
(b) Lessor shall provide written notice to IBM upon the
occurrence of a default under Section 6(b)(2) of the Guaranty and,
for a period of thirty (30) days after the giving of such notice
(the "30-day Period"), if no other Material Lease Default has then
occurred and is continuing Lessor shall not declare this Agreement
to be in default as a result of such occurrence and shall not
exercise any remedies hereunder as a result of such occurrence,
provided that all Rent and other payments becoming due hereunder
are paid as and when due during such 30-day Period. Prior to the
expiration of such 30-day Period, IBM may (at its sole
discretion): (1) cause to be delivered to Lessor an irrevocable
letter of credit (in form and substance satisfactory to Lessor)
issued by a national bank acceptable to Lessor in an amount equal
to the Rent becoming due during the next succeeding ninety (90)
day period (the "Subsequent Rent"), or (2) deliver to Lessor a
written guaranty of IBM, in substantially the form attached hereto
as Exhibit No. 5, guaranteeing the payment as and when due of the
Subsequent Rent. If IBM timely provides the required letter of
credit or guaranty, for an additional ninety (90) days after the
original 30-day Period, if no other Material Lease Default has
then occurred and is continuing, Lessor shall not declare this
Agreement to be in default as a result of such occurrence and
shall not exercise any remedies hereunder as a result of such
occurrence. Upon the expiration of such subsequent ninety (90)
day period, unless IBM has (i) delivered to Lessor a written
guaranty of IBM, in substantially the form attached hereto as
Exhibit No. 5, (ii) purchased all the Equipment for its then
Stipulated Loss Value, plus all unpaid Rent and other amounts due
hereunder, (iii) received an assignment of all right, title,
interest and obligations of Lessee in, under and pursuant to this
Agreement, and IBM has accepted such assignment and assumed such
obligations, or (iv) taken such other action acceptable to Lessor
(in its sole discretion), then Lessor may exercise all rights and
remedies hereunder.
(c) After a Lease Default has occurred and is continuing, Lessee
shall, upon demand, forthwith pay to Lessor (i) as liquidated
damages for loss of a bargain and not as a penalty, the
Termination Value of the Equipment (calculated as of the Rent
Payment Date next preceding the declaration of Lease Default), and
(ii) all Rent and other sums then having become due hereunder; and
upon payment of such sums and all other costs, charges and
expenses incurred by Lessor (including attorney's fees and
expenses) as a result of the occurrence of Lease Default, Lessor
will transfer to Lessee, on an AS IS BASIS (as hereinafter
defined), all of Lessor's interest in and to the Equipment (and
Lessor shall not be required to make and may specifically disclaim
any representation or warranty as to the condition of the
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), and 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. If Lessee fails to pay the amounts
specified in the preceding sentence, then, at the request of
Lessor, Lessee shall comply with the provisions of Section XVI
hereof. Lessee hereby authorizes Lessor to enter, with or without
legal process, any premises where any Equipment is located and
take possession thereof. Lessor may, but shall not be required
to, sell Equipment at private or public sale, in bulk or in
parcels, with or without notice, and without having the Equipment
present at the place of sale; or Lessor may, but shall not be
required to, lease, otherwise dispose of or keep idle all or part
of the Equipment. The proceeds of sale, lease or other
disposition, if any, shall be applied in the following order of
priorities: (1) to pay all of Lessor's costs, charges and
expenses incurred in taking, removing, holding, repairing and
selling, leasing or otherwise disposing of Equipment; then, (2) to
the extent not previously paid by Lessee, to pay Lessor all sums
due from Lessee hereunder; then (3) to reimburse to Lessee any
sums previously paid by Lessee as liquidated damages; and (4) any
surplus shall be paid to Lessee. Lessee shall pay any deficiency
in clauses (1) and (2) forthwith.
(d) The foregoing remedies are cumulative, and any or all
thereof may be exercised in lieu of or in addition to each other
or any remedies at law, in equity, or under statute. Lessee
waives notice of sale or other disposition (and the time and place
thereof), and the manner and place of any advertising. If
permitted by law, Lessee shall pay reasonable attorney's fees
actually incurred by Lessor in enforcing the provisions of this
Lease and any ancillary documents. Waiver of any default shall
not be a waiver of any other or subsequent default.
XVIII. LESSOR ASSIGNMENT:
(a) Lessor may not, without the consent of Lessee (which consent
shall not unreasonably be withheld, delayed or conditioned),
assign this Agreement or any Schedule, or the right to enter into
any Schedule except to a successor trustee pursuant to the Trust
Agreement. The Servicing Agent shall act as the fiscal agent for
any assignee unless the Servicing Agent is removed by Lessor as a
result of its failure or inability to perform such duties. Lessee
agrees to confirm in writing receipt of a notice of an approved
assignment as reasonably may be requested by assignee. Lessee
hereby waives and agrees not to assert against any such assignee
any defense, set-off, recoupment claim or counterclaim which
Lessee has or may at any time have against Lessor or any other
person for any reason whatsoever.
(b) Lessee acknowledges that it has been advised that the
interest of Lessor in this Agreement, the Equipment Schedules,
related instruments and documents and/or the Equipment may be
conveyed to, in whole or in part, certain third parties (each
being herein referred to as a "Participant" and, collectively, as
the "Participants") without the consent of Lessee (the
"Syndication"). Lessee agrees reasonably to cooperate with Lessor
in connection with the Syndication, including the execution and
delivery of such other documents, instruments, notices, opinions,
certificates and acknowledgements as reasonably may be required by
Lessor or such Participant; provided, however, in no event shall
Lessee be required to consent to any change that would adversely
affect any of the terms of the transactions contemplated herein;
and provided further, however, that Lessor shall be responsible
for its own costs and expenses incurred in connection with the
Syndication. Each Participant shall be required to comply with
the provisions of Section V hereof.
(c) Lessor and each Participant agrees that it will not
advertise or publish the fact that it has furnished financing to,
or otherwise entered into the transactions contemplated hereby
with Lessee, Guarantor or IBM without first obtaining the written
consent of such person. Notwithstanding any other provision of
any Operative Document, Lessor and the Participants will not have
any right to use any trademark or trade name of, or otherwise
refer to Lessee, Guarantor or IBM in any promotion or publication
without first obtaining the written consent of such person.
(d) Lessor and each Participant agrees that it shall not amend
the provisions of Section 9.01 of the Trust Agreement, pertaining
to the transfer of the Participant's interests.
(e) Subject always to the foregoing and to Section XI hereof,
this Agreement inures to the benefit of, and is binding upon, the
successors and assigns of the parties hereto.
XIX. NET LEASE; NO SET-OFF, ETC.:
This Agreement is a net lease. Lessee's obligation to pay Rent
and other amounts due hereunder shall be absolute and
unconditional. Lessee shall not be entitled to any abatement or
reductions of, or set-offs against, said Rent or other amounts,
including, without limitation, those arising or allegedly arising
out of claims (present or future, alleged or actual, and including
claims arising out of strict liability in tort or negligence of
Lessor) of Lessee against Lessor under this Agreement or
otherwise. This Agreement shall not terminate and the obligations
of Lessee shall not be affected by reason of any defect in or
damage to, or loss of possession, use or destruction of, any
Equipment from whatsoever cause. It is the intention of the
parties that Rents and other amounts due hereunder shall continue
to be payable in all events in the manner and at the times set
forth herein unless the obligation to do so shall have been
terminated pursuant to the express terms hereof.
XX. INDEMNIFICATION:
(a) Lessee hereby agrees to indemnify, save and keep harmless
Lessor, the Participants, the Servicing Agent, their agents,
employees, successors and assigns, from and against any and all
damages, penalties, injuries, claims, actions and suits (including
legal and other expenses), of whatsoever kind and nature, in
contract or tort, except as to taxes which are covered in Section
III hereof only (provided, however, that each such party is liable
for its own gross negligence or willful misconduct and shall not
be indemnified hereunder as a result thereof; and provided
further, however, that the Servicing Agent shall be liable for any
obligations it has under any other agreements and shall not be
indemnified hereunder therefor) (and including, but not limited
to, Lessor's strict liability in tort), arising out of (i) the
selection, manufacture, purchase, acceptance or rejection of
Equipment, the ownership of Equipment during the term of this
Agreement, and the delivery, lease, possession, maintenance, uses,
condition, return or operation of Equipment (including, without
limitation, latent and other defects, whether or not discoverable
by Lessor or Lessee and any claim for patent, trademark or
copyright infringement or environmental damage), or (ii) any claim
by a third party attributable to the maintenance or use of such
Item by Lessee, any sublessee or employees of Lessee. Lessee
shall, upon request, defend any actions based on, or arising out
of, any of the foregoing.
(b) Lessee hereby agrees to pay the fees and expenses of
Wilmington Trust Company, as Trustee becoming due under the Trust
Agreement, upon receipt of an invoice therefor.
(c) All of Lessor's and the Servicing Agent's rights, privileges
and indemnities contained in this Section XX shall survive the
expiration or other termination of this Agreement and the rights,
privileges and indemnities contained herein are expressly made for
the benefit of, and shall be enforceable by Lessor, its successors
and assigns.
XXI. DISCLAIMER:
LESSEE ACKNOWLEDGES THAT IT HAS SELECTED THE EQUIPMENT WITHOUT
ANY ASSISTANCE FROM LESSOR, ITS AGENTS OR EMPLOYEES. LESSOR DOES
NOT MAKE, HAS NOT MADE, NOR SHALL BE DEEMED TO MAKE OR HAVE MADE,
ANY WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, WRITTEN
OR ORAL, WITH RESPECT TO THE EQUIPMENT LEASED HEREUNDER OR ANY
COMPONENT THEREOF, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY AS
TO DESIGN, COMPLIANCE WITH SPECIFICATIONS, QUALITY OF MATERIALS OR
WORKMANSHIP, MERCHANTABILITY, FITNESS FOR ANY PURPOSE, USE OR
OPERATION, SAFETY, PATENT, TRADEMARK OR COPYRIGHT INFRINGEMENT, OR
(EXCEPT AS EXPRESSLY PROVIDED HEREIN) TITLE. All such risks, as
between Lessor and Lessee, are to be borne by Lessee. Without
limiting the foregoing, Lessor shall have no responsibility or
liability to Lessee or any other person with respect to any of the
following (i) any liability, loss or damage caused or alleged to
be caused directly or indirectly by any Equipment, any inadequacy
thereof, any deficiency or defect (latent or otherwise) therein,
or any other circumstance in connection therewith; (ii) the use,
operation or performance of any Equipment or any risks relating
thereto; (iii) any interruption of service, loss of business or
anticipated profits or consequential damages; or (iv) the
delivery, operation, servicing, maintenance, repair, improvement
or replacement of any Equipment. If, and so long as, no default
exists under this Lease, Lessee shall be, and hereby is,
authorized during the term of this Lease to assert and enforce, at
Lessee's sole cost and expense, from time to time, in the name of
and for the account of Lessor and/or Lessee, as their interests
may appear, whatever claims and rights Lessor may have against any
Supplier of the Equipment.
XXII. REPRESENTATIONS AND WARRANTIES OF LESSEE:
Lessee hereby represents and warrants to Lessor that on the date
hereof and on the date of execution of each Schedule:
(a) Lessee has adequate power and capacity to enter into, and
perform under, this Agreement and all related documents (together,
the "Documents") and is duly qualified to do business wherever
necessary to carry on its present business and operations,
including the jurisdiction(s) where the Equipment is or is to be
located, where the failure to be so qualified would have a
material adverse effect.
(b) The Documents have been duly authorized, executed and
delivered by Lessee and constitute valid, legal and binding
agreements, enforceable in accordance with their terms, except to
the extent that the enforcement of remedies therein provided may
be limited under applicable bankruptcy and insolvency laws and
equitable principles.
(c) No approval, consent or withholding of objections is
required from any governmental authority or instrumentality with
respect to the entry into or performance by Lessee of the
Documents except such as have already been obtained.
(d) The entry into and performance by Lessee of the Documents
will not: (i) violate any judgment, order, law or regulation
applicable to Lessee or any provision of that certain Partnership
Agreement dated as of September 30, 1994, between Cirel Inc. and
MiCrus Holdings Inc.; or (ii) result in any breach of, constitute
a default under or result in the creation of any lien, charge,
security interest or other encumbrance upon any Equipment pursuant
to any indenture, mortgage, deed of trust, bank loan or credit
agreement or other instrument (other than this Agreement) to which
Lessee is a party.
(e) There are no suits or proceedings pending or (to Lessee's
knowledge) threatened in court or before any commission, board or
other administrative agency against or affecting Lessee, which
will have a material adverse effect on the ability of Lessee to
fulfill its obligations under this Agreement.
(f) Lessee is a general partnership duly organized and will be
at all times validly existing under the laws of the State
specified in the first sentence of this Agreement (except in
accordance with the provisions of Section XI(c) hereof). Cirel,
Inc. and MiCrus Holdings Inc. are the sole general partners of
Lessee.
(g) The Equipment will at all times be used for commercial or
business purposes.
XXIII. OWNERSHIP FOR TAX PURPOSES; GRANT OF SECURITY INTEREST;
USURY SAVINGS:
(a) For Federal, state and local income tax purposes, Lessor
will treat Lessee as the owner of the Equipment. Accordingly,
Lessor will not claim any tax benefits available to an owner of
the Equipment.
(b) In order to secure the prompt payment of the Rent and all of
the other amounts from time to time outstanding under and with
respect to the Schedules, and the performance and observance by
Lessee of all the agreements, covenants and provisions thereof
(including, without limitation, all of the agreements, covenants
and provisions of this Agreement, which are incorporated therein
by reference), Lessee hereby grants to Lessor a first priority
security interest in (1) the Equipment leased under the Schedules,
and (2) Lessee's interest in the personal property described on
Exhibit No. 1 now or hereafter attached to this Agreement which is
leased to Lessee by Cirel, Inc. , and any and all substitutions,
replacements or exchanges therefor, and modifications, additions,
attachments, accessions and accessories thereto, made pursuant to
the terms hereof or of the lease from Cirel, Inc., in each such
case in which Lessee shall from time to time acquire an interest
(the "Additional Collateral"), and any and all insurance and/or
other proceeds (but without power of sale) of the property in and
against which a security interest is granted hereunder. Lessee
shall not directly or indirectly create, incur, assume or suffer
to exist any lien on or with respect to the Additional Collateral
except Permitted Liens and a security interest in favor of Cirel,
Inc., which security interest shall be subject and subordinate to
the interest of Lessor in the Additional Collateral. Lessee shall
use, maintain and insure the Additional Collateral as provided
herein with respect to the Equipment. Not more than three (3)
times during the Term, Lessee shall initial and deliver to Lessor
an Exhibit No. 1 to be attached hereto describing the Additional
Collateral, together with such Uniform Commercial Code financing
statements or statements of amendment as reasonably may be
required by Lessor, to be filed at Lessee's expense.
(c) It is the intention of the parties hereto to comply with any
applicable usury laws to the extent that any Schedule is
determined to be subject to such laws; accordingly, it is agreed
that, notwithstanding any provision to the contrary in any
Schedule or the Lease, in no event shall any Schedule require the
payment or permit the collection of interest in excess of the
maximum amount permitted by applicable law. If any such excess
interest is contracted for, charged or received under any Schedule
or the Lease, or in the event that all of the principal balance
shall be prepaid, so that under any of such circumstances the
amount of interest contracted for, charged or received under any
Schedule or the Lease shall exceed the maximum amount of interest
permitted by applicable law, then in such event (1) the provisions
of this paragraph shall govern and control, (2) neither Lessee
nor any other person or entity now or hereafter liable for the
payment hereof shall be obligated to pay the amount of such
interest to the extent that it is in excess of the maximum amount
of interest permitted by applicable law, (3) any such excess which
may have been collected shall be either applied as a credit
against the then unpaid principal balance or refunded to Lessee,
at the option of Lessee, and (4) the effective rate of interest
shall be automatically reduced to the maximum lawful contract rate
allowed under applicable law as now or hereafter construed by the
courts having jurisdiction thereof. It is further agreed that
without limitation of the foregoing, all calculations of the rate
of interest contracted for, charged or received under any Schedule
or the Lease (the "Interest") which are made for the purpose of
determining whether such rate exceeds the maximum lawful contract
rate, shall be made, to the extent permitted by applicable law, by
amortizing, prorating, allocating and spreading the Interest in
equal parts during the period of the full Term. Notwithstanding
the foregoing, if any applicable state law is amended or the law
of the United States of America preempts any applicable state law,
so that it becomes lawful for Lessor to receive a greater interest
per annum rate than is presently allowed, Lessee agrees that, on
the effective date of such amendment or preemption, as the case
may be, the lawful maximum hereunder shall be increased to the
maximum interest per annum rate allowed by the amended state law
or the law of the United States of America (but not in excess of
the interest rate contemplated hereunder).
XXIV. EARLY TERMINATION:
On or after the First Termination Date (specified in the
applicable Schedule), Lessee may, so long as no Material Lease
Default then exists hereunder, from time to time (i) terminate
this Agreement as to any Item of the Equipment (provided, however,
that the aggregate original Capitalized Lessor's Cost of all Items
of the Equipment terminated pursuant to this clause (i) shall not
exceed twenty (20) percent of the aggregate original Capitalized
Lessor's Cost of all Equipment described on all Schedules executed
hereunder) which have not previously been terminated under this
clause (i), or (ii) terminate this Agreement as to all Items of
the Equipment then leased pursuant to an individual Schedule, as
of a Rent Payment Date (the date of termination of this Agreement
pursuant to this Section or otherwise being hereinafter referred
to as the "Termination Date") upon at least ninety (90) days'
prior written notice to Lessor. In such notice, Lessee shall
specify whether Lessee elects to purchase the Item of the
Equipment pursuant to Paragraph (b) hereof, or to cause the Item
of the Equipment to be sold to a third party pursuant to Paragraph
(a) hereof.
(a) If Lessee elects to cause the Item of the Equipment to be
sold to a third party, Lessee shall, and Lessor may, solicit cash
bids for the Item of the Equipment on an AS IS, WHERE IS BASIS,
without recourse or warranty, express or implied, of any kind
whatsoever ("AS IS BASIS"). On or prior to the Termination Date,
Lessee shall (i) certify to Lessor any bids received by Lessee and
the expiration date for such bids, (ii) pay to the Servicing Agent
an administrative fee of Three Thousand Dollars ($3,000.00) per
notice of termination, and (iii) pay to Lessor (A) the Termination
Value (calculated as of the Termination Date) for the Equipment,
and (B) all Rent and other sums due and unpaid as of the
Termination Date with respect to the applicable Item of the
Equipment. Provided that all amounts due hereunder with respect
to the applicable Item of the Equipment have been paid on the
Termination Date, Lessor and Lessee shall sell the applicable Item
of the Equipment on an AS IS BASIS for cash to the highest bidder
and (within fifteen (15) Business Days after receipt of good
collected funds) refund the proceeds of such sale (net of any
related out-of-pocket expenses) to Lessee. Upon satisfaction of
the conditions specified in this Paragraph (a), Lessor will
transfer, on an AS IS BASIS 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 applicable Item of 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 applicable
Item of the Equipment. If such sale is not consummated due to the
fault of the potential buyer, no termination shall occur and
Lessor shall refund the Termination Value (less any out-of-pocket
expenses incurred by the Servicing Agent) to Lessee within fifteen
(15) Business Days of the expiration date set forth in the
Lessee's certification of the bid related to such sale. Lessor
shall cause the Servicing Agent to conduct any such sale promptly
and with the same consideration that the Servicing Agent would
afford to the sale of its own assets. If any such sale is not
consummated due to the fault of Lessor or the Servicing Agent,
then (i) the termination shall be deemed to have occurred as of
the expiration date set forth in Lessee's certification of the bid
related to such sale, (ii) the Termination Value shall be repaid
by Lessor to Lessee, and (iii) title to the applicable Equipment
shall vest in Lessor.
(b) If Lessee elects to purchase the applicable Item of the
Equipment, on the Termination Date, Lessee shall pay to Lessor in
cash the purchase price for the applicable Item of the Equipment,
determined as hereinafter provided. The purchase price of the
applicable Item of the Equipment shall be an amount equal to the
Termination Value (calculated as of the Termination Date) for the
applicable Item of the Equipment, plus all sales taxes upon sale.
Lessee shall also pay to Lessor all Rent and other sums due and
unpaid as of the Termination Date applicable Item of the
Equipment. Upon satisfaction of the conditions specified in this
Paragraph (b), Lessor will transfer, on an AS IS BASIS all of
Lessor's interest in and to the with respect to the applicable
Item of the Equipment. Lessor shall not be required to make and
may specifically disclaim any representation or warranty as to the
condition of such Item of the Equipment and other matters (except
that Lessor shall warrant that it has conveyed whatever interest
it received in the applicable Item of 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 applicable
Item of the Equipment.
As used herein, "Termination Value" shall mean the sum of the
applicable Stipulated Loss Value plus the Make Whole Amount. For
purposes hereof, "Make Whole Amount" shall mean a premium equal to
the excess, if any, of (i) the aggregate present value as of the
Termination Date of the sum of (A) the remaining scheduled Rent
payments with respect to the applicable Item of the Equipment,
plus (B) the full amount of the applicable Fixed Purchase Price
with respect to the applicable Item of the Equipment that but for
termination of this Agreement would be payable on the last Rent
Payment Date during the then applicable Basic Term or Renewal
Term, discounted to the date of payment at the Reinvestment Rate,
over (ii) the aggregate present value as of the Termination Date
of the sum of (A) the remaining scheduled Rent payments with
respect to the applicable Item of the Equipment, plus (B) the full
amount of the applicable Fixed Purchase Price with respect to the
applicable Item of the Equipment that but for termination of this
Agreement would be payable on the last Rent Payment Date during
the then applicable Basic Term or Renewal Term, discounted to the
date of payment at the Assumed Interest Rate; provided, however,
that if the Reinvestment Rate is equal to or higher than the
Assumed Interest Rate, the Make Whole Amount shall be zero. For
purposes hereof, "Reinvestment Rate" shall mean the sum of (i) the
Applicable Treasury Yield plus (ii) fifty (50) basis points. The
term "Applicable Treasury Yield" at any time shall mean the yield
to maturity of United States Treasury Notes with a maturity equal
to the remaining average life of the Term of the Lease as
published in The Wall Street Journal two (2) Business Days prior
to the Termination Date. If no maturity exactly corresponds to
such remaining Term, the Applicable Treasury Yield shall be
interpolated on a straight-line basis, utilizing the yields for
the two maturities which most closely correspond to the requisite
maturity. For purposes hereof, "Assumed Interest Rate" shall mean
the sum of (i) the Base Index, plus (ii) one hundred twenty-five
(125) basis points. "Base Index" shall mean the five (5)-year
Treasury Constant Maturities rate as published in The Wall Street
Journal on the second Business Day immediately preceding the Lease
Commencement Date.
XXV. END OF BASIC TERM LEASE OPTIONS:
Provided that no Material Lease Default shall have occurred and
be continuing, Lessee shall have the option, upon the expiration
of the Basic Term of the applicable Schedule, to return, or to
purchase, or to renew the term of this Agreement with respect to,
all (but not less than all) of the Equipment leased under an
individual Schedule executed hereunder upon the following terms
and conditions.
(a) Renewal. So long as Lessee shall not have exercised its
option to return the Equipment pursuant to Paragraph (b) of this
Section, nor exercised its purchase option pursuant to Paragraph
(c) of this Section, Lessee shall have the option, upon the
expiration of the Basic Term of the applicable Schedule, to renew
the Agreement with respect to all, but not less than all, of the
Equipment leased under an individual Schedule for the renewal term
specified in Paragraph B of the applicable Schedule (the "Renewal
Term") at the Basic Term Lease Rate Factor.
(b) Return. So long as Lessee shall not have exercised its
option to renew this Agreement pursuant to Paragraph (a) of this
Section, nor exercised its purchase option pursuant to Paragraph
(c) of this Section, Lessee shall have the option, upon the
expiration of the Basic Term of an individual Schedule, to return
all (but not less than all) of the Equipment described on an
individual Schedule, to Lessor upon the following terms and
conditions: If Lessee desires to exercise this option, Lessee
shall (i) pay to Lessor on the last day of the term of this
Agreement with respect to the applicable individual 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 Basic Term Fixed Purchase Price of such Equipment, and (ii)
return the Equipment to Lessor in accordance with Section XVI
hereof. That portion of the terminal rental adjustment amount
paid by Lessee to Lessor as is equal to the Basic Term Residual
Risk Amount shall be held in escrow by Lessor and deposited in an
interest-bearing account, invested in Permitted Investments (as
such term is hereinafter defined). Thereafter, upon return of all
of the Equipment described on the applicable Schedule, Lessor
shall arrange for the commercially reasonable sale, scrap or other
disposition of such Item of the Equipment. Lessee fully shall
cooperate with Lessor in consummating such sale, scrap, or other
disposition of the Equipment. Such sale, scrap or disposition
shall occur promptly and Lessor shall conduct such sale, scrap or
disposition with the same consideration that the Servicing Agent
would afford to the sale, scrap or disposition of such Item of its
own assets. Upon satisfaction of the conditions specified in this
Paragraph (b), Lessor and Lessee will transfer to the
purchaser(s), on an AS IS BASIS all of their interest in and to
the applicable 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 such 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 applicable
Equipment. Promptly following the sale, scrap or other
disposition of an Item of the Equipment and receipt by Lessor in
good collected funds of the sales proceeds, if any, with respect
to such Item of the Equipment, (1) Lessor shall pay to Lessee from
the escrow account an amount equal to the Basic Term Residual Risk
Amount (as specified in the Schedule) of such Item of the
Equipment (less all reasonable actual out-of-pocket costs,
expenses and fees incurred by the Servicing Agent, including
storage, reasonable and necessary maintenance and other
remarketing fees incurred in connection with the sale, scrap, or
disposition of such Item of the Equipment); (2) Lessor shall pay
from the escrow account all reasonable actual out-of-pocket costs,
expenses and fees of the Servicing Agent, including storage,
reasonable and necessary maintenance and other re-marketing fees
incurred in connection with the sale, scrap, or disposition of
such Item of the Equipment; and (3) any excess sales proceeds then
remaining shall be held in escrow by Lessor and deposited in an
interest-bearing account, invested in Permitted Investments.
Promptly after the sale, scrap or other disposition of all of the
Equipment described on the applicable Schedule and receipt by
Lessor in good collected funds of the sales proceeds with respect
thereto, Lessor shall pay to Lessee an amount equal to all net
proceeds, if any, of such sale, scrap or other disposition in
excess of the Basic Term Residual Risk Amount of the Equipment
already paid to Lessee, and Lessor will also pay to Lessee all
interest earned on the amount held in escrow. As used herein,
"Permitted Investments" shall mean the following securities which
shall mature within thirty (30) days of the date of purchase:
(i) direct obligations of the United States of America; or
(ii) obligations fully guaranteed by the United States of
America; or
(iii) certificates of deposit issued by, or bankers'
acceptances of, or time deposits or a deposit account with, any
bank, trust company or national banking association incorporated
or doing business under the laws of the United States of America
or one of its States, having a combined capital and surplus not
less than $100,000,000 and having a rating of "B" or better from
the Xxxxx Bank Watch Service; or
(iv) commercial paper rated A-1/P-1 by Standard & Poor's
Corporation and Xxxxx'x Investors Service, Inc., respectively (or
if neither such organization shall rate such commercial paper at
any time, by any nationally recognized rating organization in the
United States of America) equal to the highest rating assigned by
such rating organization.
(c) Purchase. So long as Lessee shall not have exercised its
option to renew this Agreement pursuant to Paragraph (a) of this
Section, nor exercised its option to return the Equipment pursuant
to Paragraph (b) of this Section, Lessee shall have the option,
upon the expiration of the Basic Term of each individual Schedule,
to purchase all (but not less than all) of the Equipment described
on such Schedule upon the following terms and conditions: If
Lessee desires to exercise this option with respect to the
Equipment described on an individual Schedule, Lessee shall pay to
Lessor on the last day of the term of this Agreement with respect
to such individual Schedule, in addition to the scheduled Rent
then due on such date and all other sums then due hereunder with
respect to the Equipment described on the applicable Schedule, 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 Basic Term Fixed Purchase Price of
such Equipment (as specified on such Schedule), plus all sales
taxes and all other reasonable and documented out-of-pocket
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 Paragraph, Lessor will transfer, on an AS IS
BASIS, all of Lessor's interest in and to the applicable
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 applicable Equipment.
(d) Notice of Election. Lessee shall give Lessor written notice
of its election of the options specified in this Section not less
than one hundred fifty (150) days nor more than three hundred
sixty-five (365) days before the expiration of the Basic Term of
an individual Schedule. Such election shall be effective with
respect to all Equipment described on the applicable Schedule. If
Lessee fails timely to provide such notice, without further action
Lessee automatically shall be deemed to have elected to renew the
term of this Agreement pursuant to Paragraph (a) of this Section
described on the applicable Schedule. XXVI. END OF RENEWAL TERM
LEASE OPTIONS.
Provided that no Material Lease Default shall have occurred and
be continuing, if Lessee exercised its option to renew this
Agreement pursuant to Section XXV, then Lessee shall have the
option, upon the expiration of the Renewal Term of each Schedule,
to return, or to purchase, or to extend the term of this Agreement
with respect to, all (but not less than all) of the Equipment
leased under an individual Schedule upon the following terms and
conditions.
(a) Extension. So long as Lessee shall not have exercised its
option to return the Equipment described on an individual Schedule
pursuant to Paragraph (b) of this Section, nor exercised its
purchase option pursuant to Paragraph (c) of this Section, Lessee
shall have the option, upon the expiration of the Renewal Term, to
extend the Agreement with respect to all, but not less than all,
of the Equipment described on an individual Schedule for an
additional term of twelve (12) months (the "Extension Term") at a
monthly rental to be paid in arrears on the same day of each month
on which the prior Renewal Term Rent installment was paid (except
that the last installment shall be paid on the last day of the
Extension Term), and calculated so as to amortize the Renewal Term
Fixed Purchase Price of such Equipment described on an individual
Schedule over the Extension Term, together with interest thereon
at a rate per annum equal to one hundred twenty-one (125) basis
points over the then current yield to maturity of U.S. Treasury
Notes having a one year maturity, in twelve (12) equal monthly
installments. At the end of the Extension Term, provided that
Lessee is not then in default under this Agreement or any other
agreement between Lessor and Lessee, Lessee shall purchase all,
and not less than all, of such Equipment described on an
individual Schedule for $1.00 cash, together with all rent and
other sums then due on such date, plus all sales taxes and all
other reasonable and documented out-of-pocket expenses incurred by
Lessor in connection with such transfer. Upon satisfaction of the
conditions specified in this Paragraph (a), Lessor will transfer,
on an AS IS BASIS, all of Lessor's interest in and to the
applicable Equipment. Lessor shall not be required to make and may
specifically disclaim any representation or warranty as to the
condition of the Equipment and any 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 applicable
Equipment.
(b) Return. So long as Lessee shall not have exercised its
extension option pursuant to Paragraph (a) of this Section, nor
exercised its purchase option pursuant to Paragraph (c) of this
Section, Lessee shall have the option, upon the expiration of the
Renewal Term of an individual Schedule, to return all (but not
less than all) of the Equipment described on an individual
Schedule, to Lessor upon the following terms and conditions: If
Lessee desires to exercise this option, Lessee shall (i) pay to
Lessor on the last day of the term of this Agreement with respect
to the applicable individual 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
Renewal Term Fixed Purchase Price of such Equipment, and (ii)
return the Equipment to Lessor in accordance with Section XVI
hereof. That portion of the terminal rental adjustment amount
paid by Lessee to Lessor as is equal to the Renewal Term Residual
Risk Amount shall be held in escrow by Lessor and deposited in an
interest-bearing account, invested in Permitted Investments.
Thereafter, upon return of all of the Equipment described on the
applicable Schedule, Lessor shall arrange for the commercially
reasonable sale, scrap or other disposition of such Equipment.
Lessee fully shall cooperate with Lessor in consummating such
sale, scrap, or other disposition of the Equipment. Such sale,
scrap or disposition shall occur promptly and Lessor shall conduct
such sale, scrap or disposition with the same consideration that
the Servicing Agent would afford to the sale, scrap or disposition
of its own assets. Upon satisfaction of the conditions specified
in this Paragraph (b), Lessor and Lessee will transfer to the
purchaser(s) on an AS IS BASIS all of Lessor's interest in and to
the applicable 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 such 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 applicable
Equipment. Promptly following the sale, scrap or other
disposition of an Item of the Equipment and receipt by Lessor in
good collected funds of the sales proceeds, if any, with respect
to such Item of the Equipment, Lessor shall pay to Lessee from the
escrow account an amount equal to the Renewal Term Residual Risk
Amount (as specified in the Schedule) of such Item of the
Equipment (less all reasonable actual out-of-pocket 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 Item of the Equipment);
(2) Lessor shall pay from the escrow account all reasonable actual
out-of-pocket costs, expenses and fees of the Servicing Agent,
including storage, reasonable and necessary maintenance and other
re-marketing fees incurred in connection with the sale, scrap, or
disposition of such Item of the Equipment; and (3) any excess
sales proceeds then remaining shall be held in escrow by Lessor
and deposited in an interest-bearing account, invested in
Permitted Investments. Promptly after the sale, scrap or other
disposition of all of the Equipment described on the applicable
Schedule and receipt by Lessor in good collected funds of the
sales proceeds with respect thereto, Lessor shall pay to Lessee an
amount equal to all of that portion of the net proceeds, if any,
of such sale, scrap or other disposition in excess of the Renewal
Term Residual Risk Amount of the Equipment already paid to Lessee
up to the Renewal Term Fixed Purchase Price of the applicable
Equipment, plus fifty (50) percent of all net proceeds, if any, of
such sale, scrap or other disposition in excess of the Renewal
Term Fixed Purchase Price of all of the applicable Equipment, and
Lessor will also pay to Lessee interest earned on the amount held
in escrow attributable to that portion of the escrowed amount
distributed to Lessee.
(c) Purchase. So long as Lessee shall not have exercised its
extension option pursuant to Paragraph (a) of this Section, nor
exercised its option to return the Equipment pursuant to Paragraph
(b) of this Section, Lessee shall have the option, upon the
expiration of the Renewal Term of each individual Schedule, to
purchase all (but not less than all) of the Equipment described on
such Schedule upon the following terms and conditions: If Lessee
desires to exercise this option with respect to the Equipment
described on an individual Schedule, Lessee shall pay to Lessor on
the last day of the term of this Agreement with respect to such
individual Schedule, in addition to the scheduled Rent then due on
such date and all other sums then due hereunder with respect to
the Equipment described on the applicable Schedule, 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 Renewal Term Fixed Purchase Price of
such Equipment (as specified on such Schedule), plus all sales
taxes 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
Paragraph (c), Lessor will transfer, on an AS IS BASIS, all of
Lessor's interest in and to the applicable 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 applicable Equipment.
(d) Notice of Election. Lessee shall give Lessor written notice
of its election of the options specified in this Section not less
than one hundred fifty (150) days nor more than three hundred
sixty-five (365) days before the expiration of the Renewal Term of
each individual Schedule. Such election shall be effective with
respect to all Equipment described on such Schedule. If Lessee
fails timely to provide such notice, without further action Lessee
automatically shall be deemed to have elected to purchase the
Equipment described on an individual Schedule pursuant to
Paragraph (c) of this Section.
XXVII. MISCELLANEOUS:
(a) LESSEE HEREBY UNCONDITIONALLY WAIVES ITS RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF, DIRECTLY OR INDIRECTLY, THIS LEASE, ANY OF THE RELATED
DOCUMENTS, ANY DEALINGS BETWEEN LESSEE AND LESSOR RELATING TO THE
SUBJECT MATTER OF THIS TRANSACTION OR ANY RELATED TRANSACTIONS,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN LESSEE
AND LESSOR. The scope of this waiver is intended to be all
encompassing of any and all disputes that may be filed in any
court (including, without limitation, contract claims, tort
claims, breach of duty claims, and all other common law and
statutory claims). THIS WAIVER IS IRREVOCABLE MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS LEASE, ANY RELATED DOCUMENTS, OR TO ANY
OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS TRANSACTION OR ANY
RELATED TRANSACTION. In the event of litigation, this Agreement
may be filed as a written consent to a trial by the court.
(b) Any cancellation or termination by Lessor, pursuant to the
provision of this Agreement, any Schedule, supplement or amendment
hereto, or the lease of any Equipment hereunder, shall not release
Lessee from any other then outstanding obligations to Lessor
hereunder.
(c) All Equipment shall at all times remain personal property
regardless of the degree of its annexation to any real property
and shall not by reason of any installation in, or affixation to,
real or personal property become a part thereof.
(d) Time is of the essence of this Agreement. Lessor's failure
at any time to require strict performance by Lessee of any of the
provisions hereof shall not waive or diminish Lessor's right
thereafter to demand strict compliance therewith.
(e) Each of the parties agrees, upon request of the other party,
to execute any instrument reasonably necessary or expedient for
filing, recording or perfecting the interest of the parties
hereunder.
(f) All notices required to be given 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
above 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.
(g) This Agreement and any Schedule and Annexes thereto, and
that certain commitment letter dated February 7, 1995, by General
Electric Capital Corporation to Guarantor, constitute the entire
agreement of the parties with respect to the subject matter
hereof. NO VARIATION OR MODIFICATION OF THIS AGREEMENT OR ANY
WAIVER OF ANY OF ITS PROVISIONS OR CONDITIONS, SHALL BE VALID
UNLESS IN WRITING AND SIGNED BY AN AUTHORIZED REPRESENTATIVE OF
THE PARTIES HERETO. Any provision of this Agreement 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.
(h) The representations, warranties and covenants of Lessee
herein shall be deemed to survive the closing hereunder. Lessor's
obligations to acquire and lease specific Items of Equipment shall
be conditioned upon Lessee providing to Lessor such information
with respect to Lessee's financial condition as Lessor may
require, and Lessor being satisfied that there shall have been no
material adverse change in the business or financial condition of
Lessee from the date of execution hereof. The obligations of
Lessee under Sections III, XVI and XX which accrue during the term
of this Agreement and obligations which by their express terms
survive the termination of this Agreement, shall survive the
termination of this Agreement.
(i) In case of a failure of Lessee to comply with any provision
of this Agreement, Lessor shall have the right, but shall not be
obligated to, effect such compliance, in whole or in part; and all
moneys spent and expenses and obligations incurred or assumed by
Lessor in effecting such compliance shall constitute additional
rent due to Lessor within five (5) days after the date Lessor
sends notice to Lessee requesting payment and providing reasonable
details. Lessor's effecting such compliance shall not be a waiver
of Lessee's default.
(j) Any Rent not paid when due hereunder and which remains
unpaid for more than ten (10) days, or any other amount not paid
to Lessor when due hereunder, shall bear interest, both before and
after any judgment or termination hereof, at the lesser of twelve
percent (12%) per annum or the maximum rate allowed by law (the
"Late Charge Rate").
(k) Any provisions in this Agreement and any Schedule which are
in conflict with any statute, law or applicable rule shall be
deemed omitted, modified or altered to conform thereto.
(l) Lessor represents and covenants to Lessee that Lessor has
full authority to enter into this Agreement and that, conditioned
upon Lessee performing all of the covenants and conditions hereof,
as to claims of Lessor or persons claiming under Lessor, Lessee
shall peaceably and quietly hold, possess and use the Equipment
during the term of this Agreement, subject to the terms and
provisions hereof.
(m) The Operative Documents are confidential documents among the
parties thereto and, for a period of seven (7) years from the date
hereof, each party (the "Relevant Party") agrees to use its best
efforts (i.e., in accordance with procedures adopted by such
Relevant Party in good faith to protect confidential information
of third parties delivered to such Relevant Party) to keep the
same confidential and not disclose the Operative Documents to any
third party without the prior written consent of Lessor, IBM and
Guarantor; provided that nothing herein shall be deemed to prevent
any such disclosure by the Relevant Party:
(i) to its auditors or attorneys;
(ii) to any other persons requiring access to such
information in connection with the normal business operations of
such Relevant Party (including portfolio review and analysis), and
such Relevant Party shall be responsible for such person acting in
compliance herewith;
(iii) to (or as required by) any regulatory authorities;
(iv) in connection with the enforcement or attempted
enforcement of any of the Operative Documents;
(v) to any person expressing an interest in acquiring,
directly or indirectly, the Relevant Party's interest in the
Operative Documents (and who agrees to be bound by the provisions
of this Paragraph (m)); or
(vi) as required by any subpoena or civil investigative
demand or any applicable law or governmental authority.
XXVIII. CHOICE OF LAW; JURISDICTION:
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK
(WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE),
INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE,
REGARDLESS OF THE LOCATION OF THE EQUIPMENT. The parties agree
that any action or proceeding arising out of or relating to this
Agreement may be commenced in the United States District Court for
the Southern District of New York.
XXIX. CHATTEL PAPER:
To the extent that any Schedule would constitute chattel paper,
as such term is defined in the Uniform Commercial Code as in
effect in any applicable jurisdiction, no security interest
therein may be created through the transfer or possession of this
Lease in and of itself without the transfer or possession of the
original of a Schedule executed pursuant to this Lease and
incorporating this Agreement by reference; and no security
interest in this Agreement and a Schedule may be created by the
transfer or possession of any counterpart of the Equipment
Schedule other than the original thereof, which shall be
identified as the document marked "Original" and all other
counterparts shall be marked "Duplicate".
XXX. SCOPE OF LIABILITY: Notwithstanding any other provision of
this Agreement or any other Operative Documents executed in
connection herewith (expressly excepting the Guaranty and the
Letter of Credit Agreement), there shall be no recourse against
Lessee or any of its partners, officers or employees, for any
liability to Lessor or any Participant arising in connection with
any breach or default under this Agreement, except to the extent
the same is enforced against the Equipment and the Additional
Collateral and any proceeds thereof (including, without
limitation, insurance proceeds thereof); and Lessor and the
Participants shall look solely to the Equipment and the Additional
Collateral and any proceeds thereof (including, without
limitation, insurance proceeds thereof) in enforcing rights and
obligations under and in connection with this Agreement and the
other Operative Documents (expressly excepting the Guaranty and
the Letter of Credit Agreement); provided that the foregoing
provisions of this Section XXX shall not (i) constitute a waiver,
release or discharge of any of Lessee's obligations hereunder, or
of any of the terms, covenants, conditions or provisions of this
Agreement or the other Operative Documents, or (ii) limit or
restrict the right of Lessor to name Lessee as a defendant in any
action or suit for a judicial foreclosure or for the exercise of
any other remedy under or with respect to this Agreement, so long
as no judgment in the nature of a deficiency judgment shall be
enforced against Lessee or any of its partners, officers or
employees out of any property, assets or funds other than the
Equipment or the Additional Collateral and any proceeds thereof
(including, without limitation, insurance proceeds thereof).
XXXI. LIMITATION OF LIABILITY: It is expressly understood and
agreed by the parties hereto that (a) this Agreement is executed
and delivered by Wilmington Trust Company, not individually or
personally but solely as trustee of MiCrus Equipment Trust 1995-1
under the Trust Agreement (the "Trust"), in the exercise of the
powers and authority conferred and vested in it, (b) each of the
representations, undertakings and agreements herein made on the
part of the Trust is made and intended not as personal
representations, undertakings and agreements by Wilmington Trust
Company but is made and intended for the purpose of binding only
the Trust, (c) nothing herein contained shall be construed as
creating any liability on Wilmington Trust Company, individually
or personally, to perform any covenant either expressed or implied
contained herein, all such liability, if any, being expressly
waived by MiCrus by any Person claiming by, through or under
MiCrus, and (d) under no circumstances shall Wilmington Trust
Company be personally liable for the payment of any indebtedness
or expenses of the Trust or be liable for the breach or failure of
any obligation, representation, warranty or covenant made or
undertaken by the Trust under this Agreement or the other
Operative Documents.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, Lessee and Lessor have caused this Agreement
to be executed by their duly authorized representatives as of the
date first above written.
LESSOR: LESSEE:
WILMINGTON TRUST COMPANY, MICRUS, a New York general partnership
NOT INDIVIDUALLY BUT
SOLELY AS TRUSTEE By: CIREL INC.,
General Partner
By:/s/ Xxxxxx X. XxxXxxxxx By:/s/ Xxx X. Xxxxxxxxxx
Name: Xxxxxx X. XxxXxxxxx Name: Xxx X. Xxxxxxxxxx
Title: Senior Financial Title:
Services Officer
By: MICRUS HOLDINGS, INC.,
General Partner
By:/s/ Xxxx X. Xxxxxxx
Name: Xxxx X. Xxxxxxx
CORPORATE GUARANTY
Date: June 19, 1995
Wilmington Trust Company,
not individually but solely as Trustee
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
To induce you to enter into that certain Master Lease
Agreement dated as of the date hereof, as now or hereafter amended
(the "Agreement"), and/or any Schedules or other documents or
instruments evidencing or relating to, any lease, loan, extension
of credit or other financial accommodation made pursuant to the
Agreement (collectively "Account Documents" and each an "Account
Document") to MICRUS, a general partnership organized and existing
under the laws of the State of New York ("Customer"), but without
in any way binding you to do so, the undersigned, for Ygood and
valuable consideration, the receipt and sufficiency of which is
hereby acknowledged ("Guarantor"), does hereby:
(a) agree to pay to you, for the period from and including
each applicable Lease Commencement Date to each applicable Basic
Term Commencement Date (the "Interim Period"), interim rent for
each Item of the Equipment, calculated as the product of the
Interest Rate times the Funding Amount with respect to such Item
(as specified on the Equipment Schedule) divided by three hundred
sixty (360), multiplied by the number of days in the Interim
Period. As used herein, "Interest Rate" shall mean that
percentage per annum calculated as the sum of one hundred (100)
basis points plus the LIBOR Rate redetermined monthly. As used
herein, "LIBOR Rate" shall mean, with respect to the Interim
Period, an interest rate per annum (rounded upward to the next
higher whole multiple of 1/16th percent if such rate is not such a
multiple), equal at all times during the Interim Period to the
quotient of (1) the rate per annum (rounded upward to the next
higher whole multiple of 1/16th percent if such rate is not such a
multiple) as determined on the basis of the average of the rates
offered by a majority of the banks in the London interbank market
for deposits in U.S. Dollars for thirty (30) days, to the extent
the rates offered by these banks appear in The Wall Street Journal
on the third Business Day next preceding the Lease Commencement
Date, redetermined monthly on the last Business Day of each
calendar month), divided by (2) a number equal to 1.00 minus the
aggregate (without duplication) of the rates (expressed as a
decimal fraction) of the LIBOR Reserve Requirements current on the
Business Day next preceding the Lease Commencement Date. As used
herein, "LIBOR Reserve Requirements" means, for the Interim
Period, the maximum reserves (whether basic, supplemental,
marginal, emergency or otherwise) prescribed by the Board of
Governors of the Federal Reserve System (or any successor) with
respect to liabilities or assets consisting of or including
"Eurocurrency liabilities" (as defined in Regulation D of the
Board of Governors of the Federal Reserve System) having a term
equal to the Interim Period. Interim rent shall be paid to you by
wire transfer of immediately available funds to your Servicing
Agent, General Electric Capital Corporation, at: Bankers Trust
Xxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Account No. 00-000-000, ABA
No. 000-000-000, or to such other account as you may direct in
writing; and shall be effective upon receipt. Such interim rent
shall be due on the earlier of: (x) the applicable Basic Term
Commencement Date, or (y) December 29, 1995; provided, however,
that if such date is not a Business Day, the interim rent
otherwise due on such date shall be payable on the immediately
preceding Business Day. Notwithstanding the foregoing, if Lessee
does not execute and deliver to you a Certificate of Acceptance
with respect to all of the Items of the Equipment listed on a
Schedule within sixty (60) days after the applicable Lease
Commencement Date (the "Expiration Date"), then the Interim Period
shall expire on the Expiration Date and Guarantor shall pay to you
on the Expiration Date the interim rent then due plus the
Capitalized Lessor's Cost then having been paid by you with
respect to all of the Items of the Equipment listed on the
Schedule. Upon receipt of such payment, so long as no Lease
Default shall then have occurred and be continuing, you will
transfer to Guarantor, on an AS IS BASIS, all your interest in and
to the applicable Items of the Equipment. You shall not be
required to make and may specifically disclaim any representation
or warranty as to the condition of the Items of the Equipment and
any other matters (except that you shall warrant that you have
conveyed whatever interest you received in the Items of the
Equipment free and clear of any lien or encumbrance created by,
through or under you). You shall execute and deliver to Guarantor
such Uniform Commercial Code Statements of Termination as
reasonably may be required in order to terminate your interest in
and to the applicable Items of the Equipment. Capitalized terms
used herein without definition shall have the meaning given them
in the Account Documents; and
(b) guarantee to you, your successors and assigns, the due
regular and punctual payment of any sum or sums of money which the
Customer may owe to you now or at any time hereafter pursuant to
or evidenced by an Account Document, and whether it represents
principal, interest, rent, late charges, indemnities, an original
balance, an accelerated balance, liquidated damages, a balance
reduced by partial payment, a deficiency after sale or other
disposition of any leased equipment, collateral or security, or
any other type of sum of any kind whatsoever that the Customer may
owe to you now or at any time hereafter pursuant to or evidenced
by an Account Document, and does hereby further guarantee to you,
your successors and assigns, the due, regular and punctual
performance of any other duty or obligation of any kind or
character whatsoever that the Customer may owe to you now or at
any time hereafter in connection with or pursuant to the Account
Documents (all such payment and performance obligations being
collectively referred to as "Obligations"). Undersigned does
hereby further guarantee to pay upon demand all losses, costs,
attorneys' fees and expenses which may be suffered by you by
reason of Customer's default or default of the undersigned.
1. This Guaranty is a guaranty of prompt payment and
performance (and not merely a guaranty of collection). Nothing
herein shall require you to first seek or exhaust any remedy
against the Customer, its successors and assigns, or any other
person obligated with respect to the Obligations, or to first
foreclose, exhaust or otherwise proceed against any leased
equipment, collateral or security which may be given in connection
with the Obligations. It is agreed that you may, upon any breach
or default of the Customer, or at any time thereafter, make demand
upon the undersigned and receive payment and performance of the
Obligations, with or without notice or demand for payment or
performance by the Customer, its successors or assigns, or any
other person. Suit may be brought and maintained against the
undersigned at your election, without joinder of the Customer or
any other person as parties thereto. The obligations of each
signatory to this Guaranty shall be joint and several.
2. The undersigned agrees that its obligations under this
Guaranty shall be primary, absolute, continuing and unconditional,
irrespective of and unaffected by any of the following actions or
circumstances (regardless of any notice to or consent of the
undersigned): (a) the genuineness, validity, regularity and
enforceability of the Account Documents or any other document; (b)
any extension, renewal, amendment, change, waiver or other
modification of the Account Documents or any other document; (c)
the absence of, or delay in, any action to enforce the Account
Documents, this Guaranty or any other documents; (d) your failure
or delay in obtaining any other guaranty of the Obligations
(including without limitation, your failure to obtain the
signature of any other guarantor hereunder); (e) the release of,
extension of time for payment or performance by or any other
indulgence granted to the Customer or any other person with
respect to the Obligations by operation of law or otherwise; (f)
the existence, value, condition, loss, subordination or release
(with or without substitution) of or failure to have title to or
perfect and maintain a security interest in, or the time, place
and manner of any sale or other disposition of any leased
equipment, collateral or security given in connection with the
Obligations, or any other impairment (whether intentional or
negligent, by operation of law or otherwise) of the rights of the
undersigned; (g) the Customer's voluntary or involuntary
bankruptcy, assignment for the benefit of creditors,
reorganization, or similar proceedings affecting the Customer or
any of its assets; or (h) any other action or circumstances which
might otherwise constitute a legal or equitable discharge or
defense of a surety or guarantor.
3. This Guaranty may be terminated upon delivery to you (at
your address shown above) of a written termination notice from the
undersigned. However, as to all Obligations (whether matured,
unmatured, absolute, contingent or otherwise) incurred by the
Customer prior to your receipt of such written termination notice
(and regardless of any subsequent amendment, extension or other
modification which may be made with respect to such Obligations),
this Guaranty shall nevertheless continue and remain undischarged
until all such Obligations are indefeasibly paid and performed in
full.
4. The undersigned agrees that this Guaranty shall remain
in full force and effect or be reinstated (as the case may be) if
at any time payment or performance of any of the Obligations (or
any part thereof) is rescinded, reduced or must otherwise be
restored or returned by you, all as though such payment or
performance had not been made. If, by reason of any bankruptcy,
insolvency or similar laws affecting the rights of creditors, you
shall be prohibited from exercising any of your rights or remedies
against the Customer or any other person or against any property,
then, as between you and the undersigned, such prohibition shall
be of no force and effect, and you shall have the right to make
demand upon, and receive payment from, the undersigned of all
amounts and other sums that would be due to you upon a default
with respect to the Obligations.
5. The undersigned covenants and agrees that: (a) it will
provide to Lessor: (1) within ninety (90) days after the end of
each of its fiscal years, its balance sheet and related statement
of income and statement of cash flows of Guarantor, prepared in
accordance with generally accepted accounting principles
consistently applied ("GAAP"), all in reasonable detail and
certified by independent certified public accountants of
recognized standing selected by the undersigned; (2) within sixty
(60) days after the end of each quarter of its fiscal year, its
balance sheet and related statement of income and statement of
cash flows for such quarter, internally prepared in accordance
with GAAP and certified by its chief financial officer; 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 the undersigned to the Securities and Exchange
Commission, including (without limitation) Forms 8K, 10K and 10Q;
(b) it will promptly execute and deliver to you such further
documents, instruments and assurances and take such further action
as you from time to time reasonably may request in order to carry
out the intent and purpose of this Guaranty and to establish and
protect the rights and remedies created or intended to be created
in your favor hereunder; and (c) upon the expiration or earlier
termination of the Term under the Agreement with respect to any
Item, Guarantor will cause the obligations secured by the New York
State Lien to be prepaid in whole or in part, as and to the extent
necessary to cause the New York State Lien to be released with
respect to such Item.
6. The undersigned shall be deemed to be in default
hereunder ("Default") if: (a) it shall fail to perform or observe
any covenant, condition or agreement to be performed or observed
by it hereunder and such failure shall continue unremedied for a
period of thirty (30) days after the earlier of the actual
knowledge of Guarantor or written notice thereof to the
undersigned by you; or (b) it shall (1) be generally not paying
its debts as they become due, (2) 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 it or its
property, and such petition filed against it is not dismissed
within sixty (60) days; or (c) there is an anticipatory
repudiation of its obligations pursuant to this Guaranty; or (d)
any certificate, statement, representation, warranty or audit
contained herein or heretofore or hereafter furnished with respect
to this Guaranty by or on behalf of the undersigned 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 it; or (e) it shall be in default under any
obligation for an amount in excess of $1,000,000.00 for borrowed
money, for the deferred purchase price of property or any lease
agreement, and the creditor thereunder shall have declared such
obligation to be accelerated; or (f) the corporate existence of
the undersigned is terminated and its obligations in connection
with this Guaranty are not assumed by a successor in interest
reasonably satisfactory to you; or (g) as a result of or in
connection with a material change in the ownership of the capital
stock of the undersigned and the debt to worth ratio of the
undersigned equals or exceeds twice its debt to worth ratio as of
the date of this Guaranty, without your prior written consent. As
used herein, "debt to worth ratio" shall mean the ratio of (1)
total liabilities which, in accordance with GAAP, would be
included in the liability side of a balance sheet, to (2) 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 good will, patents, copyrights, mailing
lists, catalogs, trademarks, bond discount and underwriting
expenses, organization expenses and other intangibles, all as
determined in accordance with GAAP. Notwithstanding the
foregoing, the events specified in sub-parts (c), (f) and (g) of
this Section 6 shall not constitute a Default hereunder if, prior
to the occurrence of the events specified in any of such
sub-parts, Guarantor delivers or causes to be delivered to you an
irrevocable stand-by letter of credit ("Letter of Credit") which
shall be (w) in an amount equal to the then Stipulated Loss Value
of the Equipment, (x) issued by a bank which is acceptable to you
in your sole discretion, (y) substantially in the form of Exhibit
A attached to the Letter of Credit Agreement (or in such other
form as may be acceptable to you in your sole discretion), and (z)
for an initial term of one (1) year with automatic annual renewals
thereafter (without amendment except for extension of the
then-current expiration date by an additional year). You shall
have the right, with or without notice to or demand upon
Guarantor, to draw upon the Letter of Credit by presenting to the
issuer one or more sight drafts and any other necessary documents,
and to receive (in a lump sum or in several sums from time to time
at your sole discretion) and retain an amount not to exceed, in
the aggregate, that available under the Letter of Credit, as and
to the extent you otherwise would have been able to demand payment
or performance by the undersigned pursuant to this Guaranty. Once
all obligations of Customer pursuant to the Account Documents have
been indefeasibly paid and performed in full, you shall release
the Letter of Credit and provide Guarantor with written notice to
that effect or, if you have then drawn under the Letter of Credit,
any remaining excess proceeds from the drawing under the Letter of
Credit shall be remitted by you to Guarantor. In any event, the
undersigned shall remain liable under this Guaranty for any
deficiency. If Guarantor is required to provide the Letter of
Credit hereunder and fails to do so, then upon your demand,
Guarantor shall pay to you the then Stipulated Loss Value of the
Equipment.
7. Upon a Default hereunder, you may, at your option,
declare this Guaranty to be in default by written notice to the
undersigned (without election of remedies), and at any time
thereafter, may do any one or more of the following, all of which
are hereby authorized by the undersigned:
A. xxx for and recover all damages then or thereafter
incurred by you as a result of such Default; and/or
B. seek specific performance of the obligations of the
undersigned hereunder.
In addition, the undersigned shall be liable for all
reasonable attorneys' fees and other costs and expenses incurred
by reason of any Default or the exercise of your remedies
hereunder and/or under the Account Document. No right or remedy
referred to herein 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.
8. Notice of acceptance of this Guaranty and of any default
by the Customer or any other person is hereby waived.
Presentment, protest, demand, and notice of protest, demand and
dishonor of any of the Obligations, and the exercise of
possessory, collection or other remedies for the Obligations, are
hereby waived. The undersigned warrants that it has adequate
means to obtain from the Customer on a continuing basis financial
data and other information regarding the Customer and is not
relying upon you to provide any such data or other information.
Without limiting the foregoing, notice of adverse change in the
Customer's financial condition or of any other fact which might
materially increase the risk of the undersigned is also waived.
All settlements, compromises, accounts stated and agreed balances
made in good faith between the Customer, its successors or
assigns, and you shall be binding upon and shall not affect the
liability of the undersigned.
9. Payment of all amounts now or hereafter owed to the
undersigned by the Customer or any other obligor for any of the
Obligations is hereby subordinated in right of payment to the
indefeasible payment in full to you of all Obligations and is
hereby assigned to you as security therefor. The undersigned
hereby irrevocably and unconditionally waives and relinquishes all
statutory, contractual, common law, equitable and all other claims
against the Customer and any other obligor for any of the
Obligations, any collateral therefor, or any other assets of the
Customer or any such other obligor, for subrogation,
reimbursement, exoneration, contribution, indemnification, setoff
or other recourse in respect of sums paid of payable to you by the
undersigned hereunder, and the undersigned hereby further
irrevocably and unconditionally waives and relinquishes any and
all other benefits which it might otherwise directly or indirectly
receive or be entitled to receive by reason of any amounts paid
by, or collected or due from, it, the Customer or any other
obligor for any of the Obligations, or realized from any of their
respective assets.
10. (a) THE UNDERSIGNED HEREBY UNCONDITIONALLY WAIVES ITS
RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS GUARANTY, THE
OBLIGATIONS GUARANTEED HEREBY, ANY OF THE RELATED DOCUMENTS, ANY
DEALINGS BETWEEN US RELATING TO THE SUBJECT MATTER HEREOF OR
THEREOF, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN
US. The scope of this waiver is intended to be all encompassing
of any and all disputes that may be filed in any court (including,
without limitation, contract claims, tort claims, breach of duty
claims, and all other common law and statutory claims). THIS
WAIVER IS IRREVOCABLE MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
GUARANTY, THE OBLIGATIONS GUARANTEED HEREBY, OR ANY RELATED
DOCUMENTS. In the event of litigation this Guaranty may be filed
as a written consent to a trial by the court.
(b) As used in this Guaranty, the word "person" shall
include any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated
organization, or any government or any political subdivision
thereof.
(c) This Guaranty is intended by the parties as a final
expression of the guaranty of the undersigned and is also intended
as a complete and exclusive statement of the terms thereof. No
course of dealing, course of performance or trade usage, nor any
paid evidence of any kind, shall be used to supplement or modify
any of the terms hereof. There are no conditions to the full
effectiveness of this Guaranty. This Guaranty and each of its
provisions may only be waived, modified, varied, released,
terminated or surrendered, in whole or in part, by a duly
authorized written instrument signed by you. No failure by you to
exercise your rights hereunder shall give rise to any estoppel
against you, or excuse the undersigned from performing hereunder.
Your waiver of any right to demand performance hereunder shall
not be a waiver of any subsequent or other right to demand
performance hereunder.
(d) This Guaranty shall bind the undersigned's successors
and assigns and the benefits thereof shall extend to and include
your successors and assigns. In the event of default hereunder,
you may at any time inspect undersigned's records, or at your
option, undersigned shall furnish you with a current independent
audit report.
(e) THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK (WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES OF
SUCH STATE), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE. The parties agree that any action or proceeding
arising out of or relating to this Agreement may be commenced in
the United States District Court for the Southern District of New
York. If any provisions of this Guaranty are in conflict with any
applicable statute, rule or law, then such provisions shall be
deemed null and void to the extent that they may conflict
therewith, but without invalidating any other provisions hereof.
(f) All notices required to be given hereunder shall be
deemed adequately given if sent by certified mail to the addressee
at its address stated herein, or at such other place as such
addressee may have designated in writing.
(g) Any provision of this Agreement 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.
(h) Each signatory on behalf of a corporate guarantor
warrants that he had authority to sign on behalf of such
corporation and by so signing, to bind said guarantor corporation
hereunder.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, this Guaranty is executed the day and year
above written.
ATTEST: CIRRUS LOGIC, INC.
/s/ Xxx X. Xxxxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxxxx
Secretary/Assistant Secretary Name: Xxxxxxx X. Xxxxxxxxx
Title: President
0000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
