August 31, 1998 EXHIBIT 10.12
Xx. Xxxx Xxx Xxxxx
You Tools Corporation/FASTNET
0000 Xxxxxxxx Xxxxxx, #000
Xxxxxxxxx, XX 00000
Re: Master Lease Agreement No. 9161, Schedule No. 02
Dear Xx. Xxx Xxxxx:
This is a letter of agreement and acknowledgment between You Tools Corporation/
FASTNET (Lessee) and Ascend Credit Corporation (Lessor) that the Rent
Commencement Date is SEPTEMBER 30, 1998 which supersedes section 2 of the Master
Lease Agreement No. 9161 and supersedes Paragraph 6 on Lease Schedule No. 02.
Except as modified by this Acknowledgment Letter, the terms and conditions of
the Master Lease Agreement and Lease Schedule shall remain in full force and
effect.
Please sign where I have marked an "X" and overnight to the address on this
letter.
If you have any questions, please don't hesitate to call me at (000) 000-0000
ext. 7538.
Regards,
ASCEND CREDIT CORPORATION
Xxxxxx X. Xxxxxxx
Admin./Operations
Agreed and Acknowledged by:
Lessee: You Tools Corporation/FASTNET
By: /s/ Xxxxx X. Xxx Xxxxx
-------------------------
Name: Xxxxx X. Xxx Xxxxx
-------------------------
Title: CEO
-------------------------
Date: 9/18/98
-------------------------
LEASE SCHEDULE NO. 01
This Schedule and its supplements incorporate by this reference the terms and
conditions of the Master Lease Agreement, Number 9161, between Ascend Credit
Corporation (Lessor) and You Tools Corporation/FASTNET (Lessee).
1. SUPPLIER: Ascend Communications Inc.
2. LOCATION OF EQUIPMENT: See Attachment A.
3. EQUIPMENT VALUE: $346,464.00 (exclusive of sales and/or use taxes).
4. LEASE TERM: The Lease Term of the Equipment described in this Schedule
shall begin on the Rent Commencement Date referenced below in Paragraph 6
and its expiration date shall be 36 months after such Rent Commencement
Date.
5. RENT: $10,705.74 per month (exclusive of sales and/or use taxes) due and
payable at the Rent Commencement Date and on the same date of each
succeeding month of the Lease Term. The advance Rent payment shall be
$10,705.74. This amount is $ N/A for the first month and $10,705.74 for the
last 1 month(s), of the Lease Term.
6. RENT COMMENCEMENT DATE: 3/27/97
7. PURCHASE OPTION: Lessee shall have the option to purchase the Equipment for
its fair market value for continued use ("FMV"), on the expiration of this
Lease or any renewal term, provided Lessee is not in default of any of its
obligations under this Lease on such expiration date. This purchase option
may only be exercised by Lessee's written notice to Lessor not earlier than
180 days, nor later than 90 days, prior to the end of the Lease Term or any
renewal term. The purchase price for such Equipment shall be payable upon
the expiration date of such term. FMV shall be equal to the value of the
Equipment installed and in use, with consideration given to the age,
condition, utility and replacement costs for the Equipment. In the event
that Lessor and Lessee are unable to agree upon the purchase price for the
Equipment, such purchase price will be determined by an independent
appraiser to be selected by Lessor. Lessee shall be responsible for all
applicable sales and/or use taxes on the Equipment. Upon exercise of this
purchase option and payment of the purchase price, Lessor shall execute and
deliver to Lessee such documents as Lessee may reasonably request in order
to vest in Lessee all right, title and interest in the Equipment.
8. RENEWAL OPTION: Lessee shall have the option to renew this Lease, on the
expiration date of this Lease or any renewal term, for the fair market
rental for the continued use of the Equipment ("FMR") and on such other
terms as may be agreed upon by Lessor and Lessee prior to such expiration
date, provided Lessee is not in default of any of its obligations under
this lease on such expiration date. This renewal option may only be
exercised by Lessee's written notice to Lessor not earlier than 180 days,
nor later than 90 days, prior to the end of the Lease Term or any renewal
term. FMR shall be equal to the value of the monthly rental of the
Equipment installed and in use, with consideration given to the age,
condition, utility and replacement costs for the Equipment, for the renewal
term.
9. TAX BENEFITS: Lessee understands that Lessor intends to claim the "Tax
Benefits", consisting of the maximum Modified Accelerated Cost Recovery
System deductions for the minimum useful life applicable to each item of
Equipment, as provided by Sections 168(b)
and (c) of the Internal Revenue Code of 1986, and analogous benefits under state
law, with respect to the Equipment. Lessee represents and warrants that: (i)
Lessee has not been, is not now, and during the term of this Lease will not
become, and will not allow the Equipment to be used by or leased to, a
tax-exempt entity or government agency; and (ii) Lessee is not now, and during
the term of this Lease will not become, a public utility. Without limitation by
the preceding sentence, Lessee agrees not to take any action, fail to take any
action, or misstate any fact which may result in any loss to Lessor of the Tax
Benefits.
Lessee agrees to pay promptly to Lessor an amount which will fully
compensate Lessor, on an after-tax basis, for any loss of the Tax Benefits,
plus interest, penalties and additions to tax, any loss in time value of
the Tax Benefits, and any taxes imposed on any such compensation payment,
resulting from Lessee's acts, omissions or misstatements, including,
without limitation, with respect to the representations and warranties in
the preceding paragraph. A loss of Tax Benefits occurs at the earliest of:
(i) the happening of any event causing the loss; (ii) payment by Lessor of
any additional tax resulting from the loss; or (iii) any adjustment to the
tax return of Lessor. Lessor's right to recovery of a loss of Tax Benefits
shall survive the expiration or termination of this Lease.
10. DESCRIPTION OF EQUIPMENT: See Schedule A which is attached hereto and made
a part hereof by this reference.
The person executing this Schedule on behalf of Lessee hereby certifies that he
or she has read, and is duly authorized to execute, this Schedule
Accepted by:
Ascend Credit Corporation LESSEE: You Tools Corporation/FASTNET
BY: BY: /s/ Xxxxx X. Xxx Xxxxx
---------------------------------- -----------------------------------
NAME: NAME: Xxxxx X. Xxx Xxxxx
-------------------------------- ---------------------------------
TITLE: TITLE: CEO
------------------------------- --------------------------------
DATE: DATE: 3/26/97
-------------------------------- ---------------------------------
LEASE SCHEDULE NO. 02
This Schedule and its supplements incorporate by this reference the terms and
conditions of the Master Lease Agreement, Number 9161, between Ascend Credit
Corporation (Lessor) and You Tools Corporation/FASTNET (Lessee).
1. SUPPLIER: Ascend Communications, Inc.
2. LOCATION OF EQUIPMENT: See Attachment A.
3. EQUIPMENT VALUE: $1,105,967.00 (exclusive of sales and/or use taxes).
4. LEASE TERM: The Lease Term of the Equipment described in this Schedule
shall begin on the Rent Commencement Date referenced below in Paragraph 6
and its expiration date shall be 36 months after such Rent Commencement
Date.
5. RENT: $34,174.38 per month (exclusive of sales and/or use taxes) due and
payable at the Rent Commencement Date and on the same date of each
succeeding month of the Lease Term. The advance Rent payment shall be
$68,348.76. This amount is $34,174.38 for the first month and $34,174.38
for the last 1 month(s), of the Lease Term.
6. RENT COMMENCEMENT DATE: September 30, 1998
7. PURCHASE OPTION: Lessee shall have the option to purchase the Equipment for
its fair market value for continued use ("FMV"), on the expiration of this
Lease or any renewal term, provided Lessee is not in default of any of its
obligations under this Lease on such expiration date. The purchase option
may only be exercised by Lessee's written notice to Lessor not earlier than
180 days, nor later than 90 days, prior to the end of the Lease Term or any
renewal term. The purchase price for such Equipment shall be payable upon
the expiration date of such term. FMV shall be equal to the value of the
Equipment installed and in use, with consideration given to the age,
condition, utility and replacement costs for the Equipment. In the event
that Lessor and Lessee are unable to agree upon the purchase price for the
Equipment, such purchase price will be determined by an independent
appraiser to be selected by Lessor. Lessee shall be responsible for all
applicable sales and/or use taxes on the Equipment. Upon exercise of this
purchase option and payment of the purchase price, Lessor shall execute and
deliver to Lessee such documents as Lessee may reasonably request in order
to vest in Lessee all right, title and interest in the Equipment.
8. RENEWAL OPTION: Lessee shall have the option to renew this Lease, on the
expiration date of this Lease or any renewal term, for the fair market
rental for the continued use of the Equipment ("FMR") and on such other
terms as may be agreed upon by Lessor and Lessee prior to such expiration
date, provided Lessee is not in default of any of its obligations under
this lease on such expiration date. This renewal option may only be
exercised by Lessee's written notice to Lessor not earlier than 180 days,
nor later than 90 days, prior to the end of the Lease Term or any renewal
term. FMR shall be equal to the value of the monthly rental of the
Equipment installed and in use, with consideration given to the age,
condition, utility and replacement costs for the Equipment, for the renewal
term.
9. TAX BENEFITS: Lessee understands that Lessor intends to claim the "Tax
Benefits", consisting of the maximum Modified Accelerated Cost Recovery
System deductions for the
minimum useful life applicable to each item of Equipment, as provided by
Sections 168(b) and (c) of the Internal Revenue Code of 1986, and analogous
benefits under state law, with respect to the Equipment. Lessee represents and
warrants that: (i) Lessee has not been, is not now, and during the term of this
Lease will not become, and will not allow the Equipment to be used by or leased
to, a tax-exempt entity or government agency; and (ii) Lessee is not now, and
during the term of this Lease will not become, a public utility. Without
limitation by the preceding sentence, Lessee agrees not to take any action, fail
to take any action, or misstate any fact which may result in any loss to Lessor
of the Tax Benefits.
Lessee agrees to pay promptly to Lessor an amount which will fully
compensate Lessor, on an after-tax basis, for any loss of the Tax Benefits,
plus interest, penalties and additions to tax, any loss in time value of
the Tax Benefits, and any taxes imposed on any such compensation payment,
resulting from Lessee's acts, omissions or misstatements, including,
without limitation, with respect to the representations and warranties in
the preceding paragraph. A loss of Tax Benefits occurs at the earliest of:
(i) the happening of any event causing the loss; (ii) payment by Lessor of
any additional tax resulting from the loss; or (iii) any adjustment to the
tax return of Lessor. Lessor's right to recovery of a loss of Tax Benefits
shall survive the expiration or termination of this Lease.
10. DESCRIPTION OF EQUIPMENT: See Schedule A which is attached hereto and made
a part hereof by this reference.
The person executing this Schedule on behalf of Lessee hereby certifies that he
or she has read, and is duly authorized to execute, this Schedule
Accepted by:
Ascend Credit Corporation LESSEE: You Tools Corporation/FASTNET
-------------------------------
BY: BY: /s/ Xxxxx X. Xxx Xxxxx
---------------------------------- -----------------------------------
NAME: NAME: Xxxxx X. Xxx Xxxxx
---------------------------------- ---------------------------------
TITLE: TITLE: CEO
------------------------------- --------------------------------
DATE: DATE: 9/18/98
-------------------------------- ---------------------------------
EXTENSION SHEET FOR UNIFORM COMMERCIAL CODE FINANCING STATEMENTS
STATE OF: PA NUMBER OF SHEETS: 1
The Equipment listed below:
QUANTITY DESCRIPTION
--------------------------------------------------------------------------------
5 TNT DUAL AC BASE CHASSIS
5 SPARE 19" RACK MOUNT KIT
5 SHIELD TO ROUTE EXHAUST TO REAR
5 STANDARD S/W RELEASE FOR TNT
5 DOMESTIC POWER CORD
33 SERIES 56 48 PORT DIGITAL MODEM CARDS
11 OCTAL CT1 TI/PRI MODULE
5 100 BASE-T ETHERNET CARD
5 HYBRID ACCESS 192 S/W ENABLE
5 ISDN SIGNALLING S/W ENABLE
1 ASCEND ACCESS CONTROL
6 TNT DUAL AC BASE CHASSIS
6 SPARE 19" RACK MOUNT KIT
6 SHIELD TO ROUTE EXHAUST TO REAR
6 STANDARD S/W RELEASE FOR TNT
6 DOMESTIC POWER CORD
6 ISDN SIGNALLING S/W ENABLE
6 100 BASE-T ETHERNET CARD
6 HYBRID ACCESS 192 S/W ENABLE
28 SERIES 56 48 PORT DIGITAL MODEM CARDS
3 REDUNDANT AC POWER SUPPLY
11 OCTAL CT1 T1/PRI MODULE
has been sold by Ascend Communications, Inc. and all additions, substitutions,
and upgrades thereto whether now or hereafter in the Lessee's possession. This
equipment is more fully described in SCHEDULE NO. 02-01 AND 02-02 TO MASTER
LEASE AGREEMENT 9161 between Debtor and Secured Party. This filing is made for
information purposes only. The equipment covered hereby is the subject of a
lease transaction with Debtor as Lessee and Secured Party as Lessor.
Debtor: You Tools Corporation/FASTNET
Secured Party: ASCEND Credit Corporation
LOCATION: SCHEDULE # 9161-02-02
You Tools Corporation/FASTNET
0000 Xxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
QTY PART # DESCRIPTION EXTENDED
-------------------------------------------------------------------------------
6 TNT-2AC TNT DUAL AC BASE CHASSIS $[ * ]
6 TNT-SP-RM19 SPARE 19" RACK MOUNT KIT $[ * ]
6 TNT-SP-SHIELD SHIELD TO ROUTE EXHAUST TO REAR $[ * ]
6 TNT-SR-STD STANDARD S/W RELEASE FOR TNT $[ * ]
6 POW-CORD-DOM DOMESTIC POWER CORD $[ * ]
6 TNT-SO-ISDN ISDN SIGNALLING S/W ENABLE $[ * ]
6 TNT-SL-E100 100 BASE-T ETHERNET CARD $[ * ]
6 TNT-SL-HA192 HYBRID ACCESS 192 S/W ENABLE $[ * ]
28 TNT-SL-DM48-S56 SERIES 56 48 PORT DIGITAL MODEM CARDS $[ * ]
3 TNT-SP-AC REDUNDANT AC POWER SUPPLY $[ * ]
11 TNT-SL-CT1 OCTAL CT1 T1/PRI MODULE $[ * ]
TOTAL: $489,719
[*] We are seeking confidential treatment of these terms, which have been
omitted. The confidential portion has been filed separately with the Securities
and Exchange Commission.
LOCATION: SCHEDULE # 9161-02-01
You Tools Corporation/FASTNET
0000 Xxxxxxxx Xxxxxx, #000
Xxxxxxxxx, XX 00000
QTY PART # DESCRIPTION EXTENDED
-------------------------------------------------------------------------------
5 TNT-2AC TNT DUAL AC BASE CHASSIS $[ * ]
5 TNT-SP-RM19 SPARE 19" RACK MOUNT KIT $[ * ]
5 TNT-SP-SHIELD SHIELD TO ROUTE EXHAUST TO REAR $[ * ]
5 TNT-SR-STD STANDARD S/W RELEASE FOR TNT $[ * ]
5 POW-CORD-DOM DOMESTIC POWER CORD $[ * ]
33 TNT-SL-DM48-S56 SERIES 56 48 PORT DIGITAL MODEM CARDS $[ * ]
11 TNT-SL-CT1 OCTAL CT1 T1/PRI MODULE $[ * ]
5 TNT-SL-E100 100 BASE-T ETHERNET CARD $[ * ]
5 TNT-SL-HA192 HYBRID ACCESS 192 S/W ENABLE $[ * ]
5 TNT-SO-ISDN ISDN SIGNALLING S/W ENABLE $[ * ]
1 AAC-CD ASCEND ACCESS CONTROL $[ * ]
TOTAL: $616,248
[*] We are seeking confidential treatment of these terms, which have been
omitted. The confidential portion has been filed separately with the Securities
and Exchange Commission.
