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EXHIBIT 10.34
MASTER LEASE AGREEMENT
Lessor: TRANSAMERICA BUSINESS CREDIT CORPORATION
RIVERWAY II
WEST OFFICE TOWER
WEST XXXXXXX ROAD
Lessee: LA JOLLA PHARMACEUTICAL COMPANY
0000 XXXXX XXXXX XXXXX
XXX XXXXX, XXXXXXXXXX 00000
The lessor pursuant to this Master Lease Agreement ("Agreement") dated December
20, 1996 is Transamerica Business Credit Corporation ("Lessor"). All equipment,
together with all present and future additions, parts, accessories, attachments,
substitutions, repairs, improvements and replacements thereof or thereto, which
are the subject of a Lease (as defined in the next sentence) shall be referred
to as "Equipment." Simultaneously with the execution and delivery of this
Agreement, the parties are entering into one or more Lease Schedules (each, a
"Schedule") which refer to and incorporate by reference this Agreement, each of
which constitutes a lease (each, a "Lease") for the Equipment specified therein.
Additional details pertaining to each Lease are specified in the applicable
Schedule. Each Schedule that the parties hereafter enter into shall constitute a
Lease. Lessor has no obligation to enter into any additional leases with, or
extend any future financing to, Lessee.
1. LEASE. Subject to and upon all of the terms and conditions of
this Agreement and each Schedule, Lessor hereby agrees to lease to Lessee and
Lessee hereby agrees to lease from Lessor the Equipment for the Term (as defined
in Paragraph 2 below) thereof.
2. TERM. Each Lease shall be effective and the term of each Lease
("Term") shall commence on the commencement date specified in the applicable
Schedule, as the same may be adjusted, in the sole discretion of Lessor pursuant
to an Adjustment Letter (the "Adjustment Letter") (but in no event shall any
Lease have a commencement date of later than December 30, 1997) and, unless
sooner terminated (as hereinafter provided), shall expire at the end of the term
specified in such Schedule; provided, however, that obligations due to be
performed by the Lessee during the Term shall continue until they have been
performed in full. Schedules will only be executed after the delivery of the
Equipment to Lessee or upon completion of deliveries of items of such Equipment
with aggregate cost of not less than $50,000.00.
3. RENT. Lessee shall pay as rent to Lessor, for use of the
Equipment during the Term or Renewal Term (as defined in Paragraph 8), rental
payments equal to the sum of all rental payments including without limitation,
security deposits, advance rents and interim rents payable in the amounts and on
the dates specified in the applicable Schedule ("Rent"). If any Rent or other
amount payable by Lessee is not paid within three days after the day on which it
becomes payable, Lessee will pay on demand, as a late charge, an amount equal to
5% of such unpaid Rent or other amount but only to the extent permitted by
applicable law. All payments provided for herein shall be payable to Lessor at
its address specified above, or at any other place designated by Lessor.
4. LEASE NOT CANCELABLE; LESSEE'S OBLIGATIONS ABSOLUTE. No Lease
may be canceled or terminated except as expressly provided herein. Lessee's
obligation to pay all Rent due or to become due hereunder shall be absolute and
unconditional and shall not be subject to any delay, reduction, set-off,
defense, counterclaim or recoupment for any reason whatsoever, including any
failure of the Equipment or any representations by the manufacturer or the
vendor thereof. If the Equipment is unsatisfactory for any reason, Lessee shall
make any claim solely against the manufacturer or the vendor thereof and shall,
nevertheless, pay Lessor all Rent payable hereunder.
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5. SELECTION AND USE OF EQUIPMENT. Lessee agrees that it shall
be responsible for the selection, use of, and results obtained from, the
Equipment and any other associated equipment or services.
6. WARRANTIES. LESSOR MAKES NO REPRESENTATION OR WARRANTY,
EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING, WITHOUT LIMITATION,
THE DESIGN OR CONDITION OF THE EQUIPMENT OR ITS MERCHANTABILITY, SUITABILITY,
QUALITY OR FITNESS FOR A PARTICULAR PURPOSE, AND HEREBY DISCLAIMS ANY SUCH
WARRANTY. LESSEE SPECIFICALLY WAIVES ALL RIGHTS TO MAKE A CLAIM AGAINST LESSOR
FOR BREACH OF ANY WARRANTY WHATSOEVER. LESSEE LEASES THE EQUIPMENT "AS IS." IN
NO EVENT SHALL LESSOR HAVE ANY LIABILITY FOR, NOR SHALL LESSEE HAVE ANY REMEDY
AGAINST LESSOR FOR, ANY LIABILITY, CLAIM, LOSS, DAMAGE OR EXPENSE CAUSED
DIRECTLY OR INDIRECTLY BY THE EQUIPMENT OR ANY DEFICIENCY OR DEFECT THEREOF OR
THE OPERATION, MAINTENANCE OR REPAIR THEREOF OR ANY CONSEQUENTIAL DAMAGES AS
THAT TERM IS USED IN SECTION 2-719(3) OF THE MODEL UNIFORM COMMERCIAL CODE OR
SIMILAR STATUTE ("UCC"). Lessor grants to Lessee, for the sole purpose of
prosecuting a claim, the benefits of any and all warranties made available by
the manufacturer or the vendor of the Equipment to the extent assignable.
7. DELIVERY. Lessor hereby appoints Lessee as Lessor's agent for
the sole and limited purpose of accepting delivery of the Equipment from each
vendor thereof. Lessee shall pay any and all delivery and installation charges.
Lessor shall not be liable to Lessee for any delay in, or failure of, delivery
of the Equipment.
8. RENEWAL. So long as no Event of Default or event, which with
the giving of notice, the passage of time, or both, would constitute an Event of
Default, shall have occurred and be continuing, or the Lessee shall not have
exercised its purchase option under Paragraph 9 hereof, the Lease will
automatically renew for a term of twelve months (the "Renewal Term") on the
terms and conditions set forth in the applicable Schedule, provided, however,
that obligations due to be performed by the Lessee during the Renewal Term shall
continue until they have been performed in full. The monthly rental payments for
the Renewal Term shall be equal to 1.25% of the equipment cost plus any monthly
sales or use tax.
9. PURCHASE OPTION. So long as no Event of Default or event
which, with the giving of notice, the passage of time, or both, would constitute
an Event of Default, shall have occurred and be continuing, Lessee may, upon
written notice to Lessor received at least one hundred eighty days before the
expiration of a Term, purchase all, but not less than all, the Equipment covered
by the applicable Lease on the date specified therefor in the applicable
Schedule ("Purchase Date"). The purchase price for such Equipment shall be its
fair market value on an "In-place, In-use" basis, as mutually agreed by Lessor
and Lessee, or, if they cannot agree, as determined by an independent appraiser
selected by Lessor and approved by Lessee, which approval will not be
unreasonably delayed or withheld. Lessee shall pay the cost of any such
appraisal. Notwithstanding the generality of the foregoing, Lessor and Lessee
agree that on the Purchase Date, the fair market value of the Equipment shall
not be less than 12.5% of equipment cost. So long as no Event of Default or
event which, with the giving of notice, the passage of time, or both, would
constitute an Event of Default, shall have occurred and be continuing, Lessee
may, upon written notice to Lessor received at least one hundred eighty days
prior to the expiration of the Renewal Term, purchase all, but not less than
all, the Equipment covered by the applicable Schedule by the date specified
therein (the "Second Purchase Date") at a purchase price equal to its then fair
market value on an "In-place, In-use" basis. On the Purchase Date or the Second
Purchase Date, as the case may be, for any Equipment, Lessee shall pay to Lessor
the applicable purchase price, together with all sales and other taxes
applicable to the transfer of such Equipment and any other amount payable
hereunder, in immediately available funds, whereupon Lessor shall transfer to
Lessee, without recourse or warranty of any kind, express or implied, all of the
Lessor's right, title and interest in and to such Equipment on an "As is, Where
is" basis.
10. OWNERSHIP; INSPECTION; MARKING; FINANCING STATEMENTS. Lessee
shall affix to the Equipment any labels supplied by Lessor indicating ownership
of such Equipment. The Equipment is and shall be the sole property of Lessor.
Lessee shall have no right, title or interest therein, except as lessee under a
Lease. The Equipment is and shall at all times be and remain personal property
and
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shall not become a fixture, other than Equipment consisting of tenant
improvements. Lessee shall obtain and record such instruments and take such
steps as may be necessary to prevent any Person from acquiring any rights in the
Equipment, other than Equipment consisting of tenant improvements, by reason of
the Equipment being claimed or deemed to be real property. Upon request by
Lessor, Lessee shall obtain and deliver to Lessor valid and effective waivers,
in recordable form, by the owners, landlords and mortgagees of the real property
upon which the Equipment is located or certificates of Lessee that it is the
owner of such real property or that such real property is neither leased nor
mortgaged. Lessee shall make the Equipment and its maintenance records available
for inspection by Lessor at reasonable times and upon reasonable notice. Lessee
shall execute and deliver to Lessor for filing any UCC financing statements or
similar documents Lessor may request.
11. EQUIPMENT USE. Lessee agrees that the Equipment will be
operated by competent, qualified personnel in connection with Lessee's business
for the purpose for which the Equipment was designed and in accordance with
applicable operating instructions, laws and government regulations, and that
Lessee shall use every reasonable precaution to prevent loss or damage to the
Equipment from fire and other hazards. Lessee shall procure and maintain in
effect all orders, licenses, certificates, permits, approvals and consents
required by federal, state or local laws or by any governmental body, agency or
authority in connection with the delivery, installation, use and operation of
the Equipment.
12. MAINTENANCE. Lessee, at its sole cost and expense, shall keep
the Equipment in a suitable environment as specified by the manufacturer's
guidelines or the equivalent and meet all recertification requirements, and
shall maintain the Equipment in its original condition and working order,
ordinary wear and tear excepted. At the request of Lessor, Lessee shall furnish
all proof of maintenance.
13. ALTERATION; MODIFICATIONS; PARTS. Lessee may alter or modify
the Equipment only with the prior written consent of Lessor. Any alteration
shall be removed and the Equipment restored to its normal, unaltered condition
at Lessee's expense (without damaging the Equipment's originally intended
function or its value) prior to its return to Lessor. Any part installed in
connection with warranty or maintenance service or which cannot be removed in
accordance with the preceding sentence shall be the property of Lessor.
14. RETURN OF EQUIPMENT. Except for Equipment that has suffered a
Casualty Loss (as defined in Paragraph 15 below) and is not required to be
repaired pursuant to Paragraph 15 below or Equipment purchased by Lessee
pursuant to Paragraph 9 above, upon expiration or termination of the Term or the
Renewal Term of a Lease, or upon demand by Lessor pursuant to Paragraph 22
below, Lessee shall contact Lessor for shipping instructions and, at Lessee's
own risk, immediately return the Equipment, freight prepaid, to a location in
the continental United States specified by Lessor. At the time of such return to
Lessor, the Equipment shall (i) be in the operating order, repair and condition
as required by or specified in the original specifications and warranties of
each manufacturer and vendor thereof, ordinary wear and tear excepted, and meet
all recertification requirements and (ii) be capable of being immediately
assembled and operated by a third party purchaser or third party lessee without
further repair, replacement, alterations or improvements, and in accordance and
compliance with any and all statutes, laws, ordinances, rules and regulations of
any governmental authority or any political subdivision thereof applicable to
the use and operation of the Equipment. Except as otherwise provided under
Paragraph 9 hereof, at least one hundred eighty days before the expiration of
the Renewal Term, Lessee shall give Lessor notice of its intent to return the
Equipment at the end of such Renewal Term. During the one hundred eighty-day
period prior to the end of a Term or the Renewal Term, Lessor and its
prospective purchasers or lessees shall have the right of access to the premises
on which the Equipment is located to inspect the Equipment, and Lessee shall
cooperate in all other respects with Lessor's remarketing of the Equipment. The
provisions of this Paragraph 14 are of the essence of the Lease, and upon
application to any court of equity having jurisdiction in the premises, Lessor
shall be entitled to a decree against Lessee requiring specific performance of
the covenants of Lessee set forth in this Paragraph 14. If Lessee fails to
return Equipment when required, the terms and conditions of the Lease shall
continue to be applicable and Lessee shall continue to pay Rent until the
Equipment is received by Lessor.
15. CASUALTY INSURANCE; LOSS OR DAMAGE. Lessee will maintain, at
its own expense, liability and property damage insurance relating the Equipment,
insuring against such risks as are customarily insured against on the type of
equipment leased hereunder by businesses in which Lessee is engaged in such
amounts, in such form, and with insurers satisfactory to Lessor; provided,
however, that the
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amount of insurance against damage or loss shall not be less than the greater of
(a) the replacement value of the Equipment and (b) the stipulated loss value of
the Equipment specified in the applicable Schedule ("Stipulated Loss Value").
Each liability insurance policy shall provide coverage (including contractual
and personal injury coverage) of not less than $1,000,000 for each occurrence,
name Lessor as an additional insured and be primary as respects of any other
insurance. Each property damage policy shall name Lessor as sole loss payee and
all policies shall contain a clause requiring the insurer to give Lessor at
least thirty days prior written notice of any alteration in the terms or
cancellation of the policy. Lessee shall furnish a copy of each insurance policy
(with endorsements) or other evidence satisfactory to Lessor that the required
insurance coverage is in effect; provided, however, Lessor shall have no duty to
ascertain the existence of or to examine the insurance policies to advise Lessee
if the insurance coverage does not comply with the requirements of this
Paragraph. If Lessee fails to insure the Equipment as required, Lessor shall
have the right but not the obligation to obtain such insurance, and the cost of
the insurance shall be for the account of Lessee due as part of the next due
Rent. Lessee consents to Lessor's release, upon its failure to obtain
appropriate insurance coverage, of any and all information necessary to obtain
insurance with respect to the Equipment or Lessor's interest therein.
Until the Equipment is returned to and received by Lessor as
provided in Paragraph 14 above, Lessee shall bear the entire risk of theft or
destruction of, or damage to, the Equipment including, without limitation, any
condemnation, seizure or requisition of title or use ("Casualty Loss"). No
Casualty Loss shall relieve Lessee from its obligations to pay Rent except as
provided in clause (b) below. When any Casualty Loss occurs, Lessee shall
immediately notify Lessor and, at the option of Lessor, shall promptly (a) place
such Equipment in good repair and working order; or (b) pay Lessor an amount
equal to the Stipulated Loss Value of such Equipment and all other amounts
(excluding Rent) payable by Lessee hereunder, together with a late charge on
such amounts at a rate per annum equal to the rate imputed in the Rent payments
hereunder (as reasonably determined by Lessor) from the date of the Casualty
Loss through the date of payment of such amounts, whereupon Lessor shall
transfer to Lessee, without recourse or warranty (express or implied), all of
Lessor's interest, if any, in and to such Equipment on an "AS IS, WHERE IS"
basis. The proceeds of any insurance payable with respect to the Equipment shall
be applied, at the option of Lessor, either towards (i) repair of the Equipment
or (ii) payment of any of Lessee's obligations hereunder. Lessee hereby appoints
Lessor as Lessee's attorney-in-fact to make claim for, receive payment of, and
execute and endorse all documents, checks or drafts issued with respect to any
Casualty Loss under any insurance policy relating to the Equipment.
16. TAXES. Lessee shall pay when due, and indemnify and hold
Lessor harmless from, all sales, use, excise and other taxes, charges, and fees
(including, without limitation, income, franchise, business and occupation,
gross receipts, sales, use, licensing, registration, titling, personal property,
stamp and interest equalization taxes, levies, imposts, duties, charges or
withholdings of any nature), and any fines, penalties or interest thereon,
imposed or levied by any governmental body, agency or tax authority upon or in
connection with the Equipment, its purchase, ownership, delivery, leasing,
possession, use or relocation of the Equipment or otherwise in connection with
the transactions contemplated by each Lease or the Rent thereunder, excluding
taxes on or measured by the net income of Lessor. Upon request, Lessee will
provide proof of payment. Unless Lessor elects otherwise, Lessor will pay all
property taxes on the Equipment for which Lessee shall reimburse Lessor promptly
upon request. Lessee shall timely prepare and file all reports and returns which
are required to be made with respect to any obligation of Lessee under this
Paragraph 16. Lessee shall, to the extent permitted by law, cause all xxxxxxxx
of such fees, taxes, levies, imposts, duties, withholdings and governmental
charges to be made to Lessor in care of Lessee. Upon request, Lessee will
provide Lessor with copies of all such xxxxxxxx.
17. LESSOR'S PAYMENT. If Lessee fails to perform its obligations
under Paragraph 15 or 16 above, or Paragraph 23 below, Lessor shall have the
right to substitute performance, in which case, Lessee shall immediately
reimburse Lessor therefor.
18. GENERAL INDEMNITY. Each Lease is a net lease. Therefore,
Lessee shall indemnify Lessor and its successors and assigns against, and hold
Lessor and its successors and assigns harmless from, any and all claims,
actions, damages, obligations, liabilities and all costs and expenses,
including, without limitation, legal fees, incurred by Lessor or its successors
and assigns arising out of each Lease including, without limitation, the
purchase, ownership, delivery, lease, possession, maintenance, condition, use or
return of the Equipment, or arising by operation of law. Lessee agrees that upon
written
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notice by Lessor of the assertion of any claim, action, damage, obligation,
liability or lien, Lessee shall assume full responsibility for the defense
thereof. Any payment pursuant to this Paragraph (except for any payment of Rent)
shall be of such amount as shall be necessary so that, after payment of any
taxes required to be paid thereon by Lessor, including taxes on or measured by
the net income of Lessor, the balance will equal the amount due hereunder. The
provisions of this Paragraph with regard to matters arising during a Lease shall
survive the expiration or termination of such Lease.
19. ASSIGNMENT BY LESSEE. Lessee shall not, without the prior
written consent of Lessor, (a) assign, transfer, pledge or otherwise dispose of
any Lease or Equipment, or any interest therein; (b) sublease or lend any
Equipment or permit it to be used by anyone other than Lessee and its employees;
or (c) move any Equipment from the location specified for it in the applicable
Schedule, except that Lessee may move Equipment to another location within the
United States provided that Lessee has delivered to Lessor (A) prior written
notice thereof and (B) duly executed financing statements and other agreements
and instruments (all in form and substance satisfactory to Lessor) necessary or,
in the opinion of the Lessor, desirable to protect Lessor's interest in such
Equipment. Notwithstanding anything to the contrary in the immediately preceding
sentence, Lessee may keep any Equipment consisting of motor vehicles or rolling
stock at any location in the United States.
20. ASSIGNMENT BY LESSOR. Lessor may assign its interest or grant
a security interest in any Lease and the Equipment individually or together, in
whole or in part. If Lessee is given written notice of any such assignment, it
shall immediately make all payments of Rent and other amounts hereunder directly
to such assignee. Each such assignee shall have all of the rights of Lessor
under each Lease assigned to it. Lessee shall not assert against any such
assignee any set-off, defense or counterclaim that Lessee may have against
Lessor or any other person.
21. DEFAULT; NO WAIVER. Lessee or any guarantor of any or all of
the obligations of Lessee hereunder (together with Lessee, the "Lease Parties")
shall be in default under each Lease upon the occurrence of any of the following
events (each, an "Event of Default"): (a) Lessee fails to pay when due any
amount required to be paid by Lessee under or in connection with any Lease; (b)
any of the Lease Parties fails to perform any other provisions under or in
connection with a Lease or violates any of the covenants or agreements of such
Lease Party under or in connection with a Lease; (c) any representation made or
financial information delivered or furnished by any of the Lease Parties under
or in connection with a Lease shall prove to have been inaccurate in any
material respect when made; (d) any of the Lease Parties makes an assignment for
the benefit of creditors, whether voluntary or involuntary, or consents to the
appointment of a trustee or receiver, or if either shall be appointed for any of
the Lease Parties or for a substantial part of its property without its consent
and, in the case of any such involuntary proceeding, such proceeding remains
undismissed or unstayed for forty-five days following the commencement thereof;
(e) any petition or proceeding is filed by or against any of the Lease Parties
under any Federal or State bankruptcy or insolvency code or similar law and, in
the case of any such involuntary petition or proceeding, such petition or
proceeding remains undismissed or unstayed for forty-five days following the
filing or commencement thereof, or any of the Lease Parties takes any action
authorizing any such petition or proceeding; (f) any of the Lease Parties fails
to pay when due any indebtedness for borrowed money or under conditional sales
or installment sales contracts or similar agreements, leases or obligations
evidenced by bonds, debentures, notes or other similar agreements or instruments
to any creditor (including Lessor under any other agreement) after any and all
applicable cure periods therefor shall have elapsed; (g) any judgment shall be
rendered against any of the Lease Parties which shall remain unpaid or unstayed
for a period of sixty days; (h) any of the Lease Parties shall dissolve,
liquidate, wind up or cease its business, sell or otherwise dispose of all or
substantially all of its assets make any material change in its capital
structure or lines of business, amend or modify its name, merge or consolidate
with any other entity, suffer any loss or suspension of any license, permit or
other right or asset necessary to the profitable conduct of its business, fail
to pay its debts as they mature, or call a meeting for purposes of compromising
its debts; (i) any of the Lease Parties shall deny or disaffirm its obligations
hereunder or under any of the documents delivered in connection herewith; (j)
there is a change in the ownership of any equity or ownership interest of any of
the Lease Parties or any such interest becomes subject to any contractual,
judicial or statutory lien, charge, security interest or encumbrance; or (k)
Lessor, in its reasonable judgment, shall deem itself insecure.
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22. REMEDIES. Upon the occurrence and continuation of an Event of
Default, Lessor shall have the right, in its sole discretion, to exercise any
one or more of the following remedies: (a) terminate each Lease; (b) declare any
and all Rent and other amounts then due and any and all Rent and other amounts
to become due under each Lease immediately due and payable; (c) take possession
of any or all items of Equipment, wherever located, without demand, notice,
court order or other process of law, and without liability for entry to Lessee's
premises, for damage to Lessee's property or otherwise; (d) demand that Lessee
return any or all Equipment to Lessor in accordance with Paragraph 14 above,
and, for each day that Lessee shall fail to return any item of Equipment, Lessor
may demand an amount equal to the Rent payable for such Equipment in accordance
with Paragraph 14 above; (e) lease, sell or otherwise dispose of the Equipment
in a commercially reasonable manner, with or without notice and on public or
private bid; (f) recover the following amounts from the Lessee (as damages,
including reimbursement of costs and expenses, liquidated for all purposes and
not as a penalty): (i) all costs and expenses of Lessor reimbursable to it
hereunder, including, without limitation, expenses of disposition of the
Equipment, legal fees and all other amounts specified in Paragraph 23 below;
(ii) an amount equal to the sum of (A) any accrued and unpaid Rent through the
later of (1) the date of the applicable default or (2) the date that Lessor has
obtained possession of the Equipment or such other date as Lessee has made an
effective tender of possession of the Equipment to Lessor (the "Default Date")
and (B) if Lessor resells or re-lets the Equipment, Rent at the periodic rate
provided for in each Lease for the additional period that it takes Lessor to
resell or re-let all of the Equipment; (iii) the present value of all future
Rent reserved in the Leases and contracted to be paid over the unexpired Term of
the Leases discounted at five percent simple interest per annum; (iv) the
residual value of the Equipment as of the expiration of the Term of the
applicable Lease, which the parties agree to be twenty-five percent (25%) of the
original cost of the Equipment; and (v) any indebtedness for Lessee's indemnity
under Paragraph 18 above, plus a late charge at the rate specified in Paragraph
3 above, less the amount received by Lessor, if any, upon sale or re-let of the
Equipment; and (g) exercise any other right or remedy to recover damages or
enforce the terms of the Leases. Lessor may pursue any other rights or remedies
available at law or in equity, including, without limitation, rights or remedies
seeking damages, specific performance and injunctive relief. Any failure of
Lessor to require strict performance by Lessee, or any waiver by Lessor of any
provision hereunder or under any Schedule, shall not be construed as a consent
or waiver of any other breach of the same or of any other provision. Any
amendment or waiver of any provision hereof or under any Schedule or consent to
any departure by Lessee herefrom or therefrom shall be in writing and signed by
Lessor.
No right or remedy is exclusive of any other provided herein or
permitted by law or equity. All such rights and remedies shall be cumulative and
may be enforced concurrently or individually from time to time.
23. LESSOR'S EXPENSE. Lessee shall pay Lessor on demand all fees
and expenses in protecting and enforcing Lessor's rights and interests in each
Lease and the Equipment, including, without limitation, legal, collection and
remarketing fees and expenses incurred by Lessor in enforcing the terms,
conditions or provisions of each Lease upon the occurrence and continuation of
an Event of Default.
24. LESSEE'S WAIVERS. To the extent permitted by applicable law,
Lessee hereby waives any and all rights and remedies conferred upon a lessee by
Sections 2A-508 through 2A-522 of the UCC. To the extent permitted by applicable
law, Lessee also hereby waives any rights now or hereafter conferred by statute
or otherwise which may require Lessor to sell, lease or otherwise use any
Equipment in mitigation of Lessor's damages as set forth in Paragraph 22 above
or which may otherwise limit or modify any of Lessor's rights or remedies under
Paragraph 22. Any action by Lessee against Lessor for any default by Lessor
under any Lease shall be commenced within one year after any such cause of
action accrues.
25. NOTICES; ADMINISTRATION. Except as otherwise provided herein,
all notices, approvals, consents, correspondence or other communications
required or desired to be given hereunder shall be given in writing and shall be
delivered by overnight courier, hand delivery or certified or registered mail,
postage prepaid, if to Lessor, then to Technology Finance Division, 000
Xxxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxx 00000, Attention: Assistant Vice
President, Lease Administration, with a copy to Lessor at Riverway II, West
Office Tower, 0000 Xxxx Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention: Legal
Department, if to Lessee, then to La Jolla Pharmaceutical Company, 0000 Xxxxx
Xxxxx Xxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000, Attention: Vice President and Chief
Financial Officer or such other address as shall be
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designated by Lessee or Lessor to the other party. All such notices and
correspondence shall be effective when received.
26. REPRESENTATIONS. Lessee represents and warrants to Lessor that
(a) Lessee is duly organized, validly existing and in good standing under the
laws of the State of its incorporation; (b) the execution, delivery and
performance by Lessee of this Agreement are within Lessee's powers, have been
duly authorized by all necessary action, and do not contravene (i) Lessee's
organizational documents or (ii) any law or contractual restriction binding on
or affecting Lessee; (c) no authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body is
required for the due execution, delivery and performance by Lessee of this
Agreement; and (d) each Lease constitutes the legal, valid and binding
obligations of Lessee enforceable against Lessee in accordance with its terms.
27. FURTHER ASSURANCES. Lessee, upon the request of Lessor, will
execute, acknowledge, record or file, as the case may be, such further documents
and do such further acts as may be reasonably necessary, desirable or proper to
carry out more effectively the purposes of this Agreement. Lessee hereby
appoints Lessor as its attorney-in-fact to execute on behalf of Lessee and
authorizes Lessor to file without Lessee's signature any UCC financing
statements and amendments Lessor deems advisable.
28. FINANCIAL STATEMENTS. Lessee shall deliver to Lessor; (a) as
soon as available, but not later than 120 days after the end of each fiscal year
of Lessee and its consolidated subsidiaries, the consolidated balance sheet,
income statement and statements of cash flows and shareholders equity for Lessee
and its consolidated subsidiaries (the "Financial Statements") for such year,
reported on by independent certified public accountants without an adverse
qualification; and (b) as soon as available, but not later than 60 days after
the end of each of the first three fiscal quarters in any fiscal year of Lessee
and its consolidated subsidiaries, the Financial Statements for such fiscal
quarter, together with a certification duly executed by a responsible officer of
Lessee that such Financial Statements have been prepared in accordance with
generally accepted accounting principles and are fairly stated in all material
respects (subject to normal year-end audit adjustments).
29. CONSENT TO JURISDICTION. Lessee irrevocably submits to the
jurisdiction of any Illinois state or federal court sitting in Illinois for any
action or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby, and Lessee irrevocably agrees that all claims
in respect of any such action or proceeding may be heard and determined in such
Illinois state or federal court.
30. WAIVER OF JURY TRIAL. LESSEE AND LESSOR IRREVOCABLY WAIVE ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
31. FINANCE LEASE. Lessee and Lessor agree that each Lease is a
"Finance Lease" as defined by Section 2A-103(g) of the UCC. Lessee acknowledges
that Lessee has reviewed and approved each written Supply Contract (as defined
by UCC 2A-103(y)) covering Equipment purchased from each "Supplier" (as defined
by UCC 2A-103(x)) thereof.
32. NO AGENCY. Lessee acknowledges and agrees that neither the
manufacturer or supplier, nor any salesman, representative or other agent of the
manufacturer or supplier, is an agent of Lessor. No salesman, representative or
agent of the manufacturer or supplier is authorized to waive or alter any term
or condition of this Agreement or any Schedule and no representation as to the
Equipment or any other matter by the manufacturer or supplier shall in any way
affect Lessee's duty to pay Rent and perform its other obligations as set forth
in this Agreement or any Schedule.
33. SPECIAL TAX INDEMNIFICATION. Lessee acknowledges that Lessor,
in determining the Rent due hereunder, has assumed that certain tax benefits as
are provided to an owner of property under the Internal Revenue Code of 1986, as
amended (the "Code"), and under applicable state tax law, including, without
limitation, depreciation deductions under Section 168(b) of the Code, and
deductions under Section 163 of the Code in an amount at least equal to the
amount of interest paid or accrued by Lessor with respect to any indebtedness
incurred by Lessor in financing its purchase of the Equipment, are available to
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Lessor as a result of the lease of the Equipment. In the event Lessor is unable
to obtain such tax benefits for any reason, is required to include in income any
amount other than the Rent or is required to recognize income in respect of the
Rent earlier than anticipated pursuant to this Agreement, Lessee shall pay
Lessor additional rent ("Additional Rent") in a lump sum in an amount needed to
provide Lessor with the same after-tax yield and after-tax cash flow as would
have been realized by Lessor had Lessor (i) been able to obtain such tax
benefits, (ii) not been required to include any amount in income other than the
Rent and (iii) not been required to recognize income in respect of the Rent
earlier than anticipated pursuant to this Agreement. The Additional Rent shall
be computed by Lessor, which computation shall be binding on Lessee. The
Additional Rent shall be due immediately upon written notice by Lessor to Lessee
of Lessor's inability to obtain tax benefits, the inclusion of any amount in
income other than the rent or the recognition of income in respect of the Rent
earlier than anticipated pursuant to the Agreement. The provisions of this
Paragraph 33 shall survive the termination of this Agreement.
34. GOVERNING LAW; SEVERABILITY. EACH LEASE SHALL BE GOVERNED BY
THE LAWS OF THE STATE OF ILLINOIS. IF ANY PROVISION SHALL BE HELD TO BE INVALID
OR UNENFORCEABLE, THE VALIDITY AND ENFORCEABILITY OF THE REMAINING PROVISIONS
SHALL NOT IN ANY WAY BE AFFECTED OR IMPAIRED.
LESSEE ACKNOWLEDGES THAT LESSEE HAS READ THIS AGREEMENT AND THE SCHEDULE HERETO,
UNDERSTANDS THEM, AND AGREES TO BE BOUND BY THEIR TERMS AND CONDITIONS. FURTHER,
LESSEE AND LESSOR AGREE THAT THIS AGREEMENT AND THE SCHEDULES DELIVERED IN
CONNECTION HEREWITH FROM TIME TO TIME ARE THE COMPLETE AND EXCLUSIVE STATEMENT
OF THE AGREEMENT BETWEEN THE PARTIES, SUPERSEDING ALL PROPOSALS OR PRIOR
AGREEMENTS, ORAL OR WRITTEN, AND ALL OTHER COMMUNICATIONS BETWEEN THE PARTIES
RELATING TO THE SUBJECT MATTER HEREOF.
IN WITNESS WHEREOF, the parties hereto have executed or caused this
Master Lease Agreement to be duly executed by their duly authorized officers as
of this 20th day of December, 1996.
LA JOLLA PHARMACEUTICAL COMPANY
By /s/ Wood X. Xxxxx
----------------------------------
Title: Vice President and Chief Financial Officer
FED ID NO. 000-00-000
----------
TRANSAMERICA BUSINESS CREDIT
CORPORATION
By /s/ Xxxx X. Xxxx
----------------------------------
Title: Vice President
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