EXHIBIT 10.21
Master Agreement No. 673
MASTER AGREEMENT OF TERMS AND CONDITIONS FOR LEASE
MASTER AGREEMENT OF TERMS AND CONDITIONS FOR LEASE MADE AS OF NOVEMBER 13,
1997, BETWEEN TLP LEASING PROGRAMS, INC. HAVING ITS CHIEF EXECUTIVE OFFICES AT
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("LESSOR") AND BIG
ENTERTAINMENT, INC., A FLORIDA CORPORATION HAVING ITS CHIEF EXECUTIVE OFFICES
AT ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, #▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("LESSEE") ("MASTER
AGREEMENT").
1. LEASE
On the terms and conditions of this Master Agreement, Lessor shall lease to
Lessee, and Lessee shall hire from Lessor, the units of personal property which
shall include software (collectively the "Equipment" and individually a "Unit"
or "Item") described in the Schedule(s) which shall incorporate this Master
Agreement. Each Schedule shall constitute a separate, and independent lease and
contractual obligation of Lessee. The term "Lease" shall refer to an individual
Schedule which incorporates this Master Agreement of Terms and Conditions for
Lease. In the event of any inconsistency or conflict between the terms and
provisions of this Master Agreement and the terms and provisions of the
Equipment Schedule, the terms and provisions of the Equipment Schedule shall
prevail. Until a Lease is duly executed by Lessor, a Lease signed by Lessee
constitutes an irrevocable offer by Lessee to lease from Lessor.
2. TERM
a. The Lease shall be comprised of an Acceptance Date and a Base Term. The
Acceptance Date shall commence on the date of installation ("Acceptance Date")
and terminate on the first day of the month following the Acceptance Date. The
first day of the month following the Acceptance Date shall be known as the Base
Term Commencement Date. The Base Term of the Lease shall begin on the Base Term
Commencement Date, and may, as provided in Subsection 2 (b), terminate on the
last day of the last month of the Base Term.
b. A Lease may be terminated as of the last day of the last month of the Base
Term or later, by written notice given by either Lessor or Lessee not less than
six months prior to the date of termination designated in such notice, which
date shall be the last day of a calendar month. If the Lease is not so
terminated at the end of the Base Term and other rental amounts are not
specified in the Schedule or mutually agreed in writing, the Base Monthly Rental
shall continue to be due and payable by Lessee. Any notice of termination may
not be revoked without the written consent of the other party. Lessor shall have
the opportunity to submit or match the last proposal for the financing of any
equipment which is replacing Equipment leased pursuant to a Lease.
3. RENTAL
a. The rental amount payable to Lessor by Lessee for each Item will be on the
Schedule. As rent for Equipment, Lessee shall pay Lessor in immediately
available funds and in advance (i) on the Base Term Commencement Date and on the
first day of each month during the Base Term of the Lease the Base Monthly
Rental, per month, and (ii) on the Installation Date an amount equal to 1/30th
of the Base Monthly Rental for each Item times the number of days which will
elapse from the Installation Date of such Item to the Base Term Commencement
Date of the Lease. Each remittance from Lessee to Lessor shall contain
information as to the Lease for which payment is made.
b. Any payment due under a Lease which is past due for more than five (5) days
shall be immediately payable with interest computed from the day payment was due
at the rate of 2.0% per month, or if such rate shall exceed the maximum rate of
interest allowed by law, then at such maximum rate.
4. TAXES
The Lessee agrees (i) to pay any and all taxes, assessments and other
governmental charges of whatever kind or character and by whomever payable on or
relating to each Item of Equipment and on the sale, ownership, use, shipment,
transportation, delivery or operation thereof or the exercise of any option,
election or performance of an obligation by the Lessee or Lessor under a Lease,
including any penalties or interest thereon, which are levied, assessed or
imposed during the Base Term, (ii) to pay all taxes, assessments and charges of
the kind above referred to, including any penalties or interest thereon, which
remain unpaid as of the date of delivery of such Item of Equipment to the Lessee
irrespective of when the same may have been levied, assessed or imposed and
(iii) to pay all taxes or like charges levied, assessed or imposed on or
measured by the rents or other sums payable under such Lease, including any
penalties or interest thereon, whether such taxes are payable by the Lessor or
the Lessee. The foregoing obligations of Lessee shall include preparation and
submission of all required Personal Property Tax filings to the applicable
taxing authorities for any assessment date falling within the term of this
Lease, or extension thereof, whether such Personal Property Tax Filings shall
be, under applicable law, the obligation of the Lessor or Lessee, and Lessor
hereby appoints Lessee its agent and attorney-in-fact for the purpose of making
such filings on behalf of Lessor. Lessor agrees to cooperate fully with Lessee
by executing any documents prepared by Lessee for filing (where the taxing
authority will not accept Lessee's appointment as agent for Lessor) and
forwarding promptly to Lessee any assessments, tax bills or other correspondence
received in connection therewith.
This Section 4 shall not be deemed to obligate the Lessee to pay (i) any taxes,
fees, assessments and charges which may have been included in the cost of each
Item of Equipment as set forth in the Schedule, or (ii) any taxes, fees or other
charges based on or measured by net income incurred as the result (whether
solely or in part) of business or transactions unrelated to the applicable
Lease, or (iii) any income, franchise and like taxes against the Lessor on or
measured by the net income from the rents; provided, however, that the Lessee
agrees to pay any such taxes on or measured by rents payable hereunder or the
net income therefrom which are in substitution for or relieve the Lessee from
any tax which the Lessee would otherwise be obligated to pay under the terms of
this Section.
The Lessee shall not be obligated to pay any amount under this Section 4 so long
as it shall, in good faith and by appropriate proceedings, be contesting the
validity or the amount thereof unless such contest would adversely affect the
title of the Lessor to an Item of Equipment or would subject it to forfeiture or
sale. The Lessee agrees to indemnify and defend the Lessor against any loss,
claim, demand or expense including any reasonable legal expense resulting from
such non-payment or contest.
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Master Agreement No. 673
The obligations and liabilities of the Lessee under this Section 4 which arise
during the Base Term shall continue in full force and effect notwithstanding the
termination of the Lease or the termination of the term thereof whether by
expiration of time, by operation of law or otherwise unless and until expressly
released by the Lessor.
5. NET LEASE
The Lease is a net lease, it being the intention of the parties that all costs,
expenses and liabilities associated with the Equipment or its lease or purchase
shall be borne by Lessee unless expressly agreed to the contrary in the Lease.
Lessee's agreement to pay all obligations under the Lease, including but not
limited to rent, is absolute and unconditional and such agreement is for the
benefit of Lessor its successors and assigns. Lessee's obligations shall not be
subject to any abatement, deferment, reduction, setoff, defense, counterclaim or
recoupment for any reason whatsoever. Except as may be otherwise expressly
provided in the Lease, it shall not terminate, nor shall the obligations of
Lessee be affected, by reason of any defect in or damage to, or any loss or
destruction of, or obsolescence of, the Equipment or any Unit from any cause
whatsoever, or the interference with the use by any private person, corporation
or governmental authority, or as a result of any war, riot, insurrection or Act
of God. It is the express intention of Lessor and Lessee that all rent and other
sums payable by Lessee under the Lease shall be, and continue to be, payable in
all events throughout the term of the Lease. The Lease shall be binding upon the
Lessee, its successors and assigns and shall inure to the benefit of Lessor, its
successors and assignees. All references to Lessor shall include the Lessor's
successors and assigns.
6. INSTALLATION, RETURN, AND USE OF EQUIPMENT
a. Upon delivery of the Equipment to Lessee, Lessee shall pay all
transportation, installation, rigging, packing and insurance charges with
respect to the Equipment. In the case of a sale and leaseback transaction,
Lessee shall, upon the request of Lessor, certify the date the Equipment was
first put into use. Lessee will provide the required electric current and a
suitable place of installation for the Equipment with all appropriate facilities
as specified by the manufacturer. No cards, tapes, disks, data cells or other
input/output and storage media may be used by Lessee to operate any Unit unless
it meets the specifications of the manufacturer. If applicable, Lessee agrees
that it will not install, or permit the installation of, the Equipment without
Lessor's consent. Such consent and all consents required to be obtained in the
Lease shall be requested in writing, setting forth such facts as Lessor may
reasonably require and such consent and all consents of Lessor shall not be
unreasonably withheld.
b. Lessee shall, at all times during the term of the Lease, be entitled to
unlimited use of the Equipment. Lessee will at all times keep the Equipment in
its sole possession and control. The Equipment shall not be moved from the
location stated in the Schedule without the prior written consent of Lessor and
in no event shall the Equipment be moved outside the United States. Any time
during the term of the Lease and upon the written request of Lessor, Lessee
shall at Lessee's expense certify to Lessor (i) the location of the Equipment,
(ii) the serial numbers, features, additions to or other characteristics of the
Equipment and (iii) the eligibility of the Equipment for the manufacturer of the
Equipment's standard maintenance contract. Lessee will comply with all laws,
regulations, and ordinances, and all applicable requirements of the manufacturer
of the Equipment which apply to the physical possession, use, operation,
condition, and maintenance of the Equipment. Lessee agrees to obtain all permits
and licenses necessary for the operation of the Equipment.
c. Lessee shall not, without the prior written consent of Lessor, affix or
install any accessory, feature, equipment or device to the Equipment or make any
improvement, upgrade, modification, alteration or addition to the Equipment (any
such accessory, feature, equipment, device or improvement, upgrade,
modification, alteration or addition affixed or installed is an "Improvement").
Title to all Improvements shall, without further act, upon the making, affixing
or installing of such Improvement, vest in Lessor, except such Improvements as
may be readily removed without causing material damage to the Equipment and
without in any way affecting or impairing the originally intended function,
value or use of the Equipment. Removal of the Improvement shall be performed by
the manufacturer, at the sole expense of Lessee. Provided the Equipment is
returned to Lessor in the condition required by the Lease, including, but not
limited to, coverage under the manufacturer's standard maintenance contract,
title to the Improvement shall vest in the Lessee upon removal. Any Improvement
not removed from the Equipment prior to return shall remain the property of
Lessor and shall be certified for maintenance by the manufacturer, at Lessee's
expense.
Lessee shall notify Lessor in writing no less than 60 days prior to the
anticipated installation date of the type of Improvement Lessee desires to
obtain. Lessor may, at any time within 30 days after receipt of the notice offer
to provide the Improvement to Lessee upon terms and conditions to be agreed
upon. Lessee shall notify Lessor of any third party offers and shall lease the
Improvement from Lessor, if Lessor meets the terms of the third party offer.
Any new Improvement shall not be placed in service by Lessee prior to
acquisition by Lessor. Lessee shall execute and deliver any document necessary
to vest title to such Improvement in Lessor.
During the Lease term and any renewal term, Lessee shall cause all Improvements
to be maintained, at Lessee's expense, in accordance with the requirements of
Section 7. Unless otherwise agreed to by Lessor, upon the expiration or earlier
termination of the Lease term, any Improvement shall be de-installed and removed
from the Equipment by the manufacturer, at Lessee's expense. If the Improvement
is removed, the Equipment shall be restored to its unmodified condition and
shall be certified for maintenance by the manufacturer, at Lessee's expense.
In the event an Improvement is provided to Lessee by a party other than Lessor,
Lessee shall cause such party to execute and deliver to Lessor such documents as
shall be required by Lessor to protect the interests of Lessor and any Assignee
in the Equipment, this Master Agreement and any Schedule.
d. Lessee shall, at the termination of the Lease, at its expense, de-install,
pack and return the Equipment to Lessor at such location within the continental
United States as shall be designated by Lessor in the same operating order,
repair, condition and appearance as of the Installation Date, reasonable wear
and tear excepted, with all current engineering changes prescribed by the
manufacturer of the Equipment or a maintenance contractor approved by Lessor
(the "Maintenance Organization") incorporated in the Equipment. Until the return
of the Equipment to Lessor, Lessee shall be obligated to pay the Base Monthly
Rental and all other sums due under the Lease. Upon redelivery to Lessor, Lessee
shall arrange and pay for such repairs (if any) as are necessary for the
manufacturer of the
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Master Agreement No. 673
Equipment or Maintenance Organization to accept the Equipment under a
maintenance contract at its then standard rates.
7. MAINTENANCE AND REPAIRS
If applicable, Lessee shall, during the term of the Lease, maintain in full
force and effect a contract with the manufacturer of the Equipment or
Maintenance Organization covering at least prime shift maintenance of the
Equipment. If applicable, Lessee upon request shall furnish Lessor with a copy
of such maintenance contract as amended or supplemented. During the term of the
Lease, Lessee shall, at its expense, keep the Equipment in good working order,
repair, appearance and condition and make all necessary adjustments, repairs and
replacements, all of which shall become the property of Lessor. Lessee shall not
use or permit the use of the Equipment for any purpose for which, in the opinion
of the manufacturer of the Equipment or Maintenance Organization, the Equipment
is not designed or intended.
8. OWNERSHIP, LIENS AND INSPECTIONS
a. Lessee shall keep the Equipment free from any marking or labeling which might
be interpreted as a claim of ownership by Lessee or any party other than Lessor,
its successors and assigns and shall affix and maintain tags, decals or plates
furnished by Lessor to the Equipment indicating ownership and title to the
Equipment in Lessor (or its successors or assigns). Upon reasonable notice to
Lessee, Lessor or its agents shall have access to the Equipment and Lessee's
books and records with respect to the Lease and the Equipment at reasonable
times for the purpose of inspection and for any other purposes contemplated by
the Lease, subject to the reasonable security requirements of Lessee.
b. Lessee shall execute and deliver such instruments, including Uniform
Commercial Code financing statements, as are required to be filed to evidence
the interest of Lessor, its successors and assigns in the Equipment or the
Lease. Lessee has no interest in the Equipment except as expressly set forth in
the Lease, and that interest is a lease-hold interest. Lessor and Lessee agree,
and Lessee represents for the benefit of Lessor, its successors and assigns,
that the Lease is intended to be a "finance lease" and not a "lease intended as
security" as those terms are used in the Uniform Commercial Code; and that the
Lease is intended to be a "true lease" as the term is commonly used under the
Internal Revenue Code of 1986, as amended.
c. LESSEE SHALL KEEP THE LEASE, THE EQUIPMENT AND ANY IMPROVEMENTS FREE AND
CLEAR OF ALL LIENS AND ENCUMBRANCES AND LESSEE SHALL NOT ASSIGN THE LEASE OR ANY
OF ITS RIGHTS UNDER THE LEASE OR SUBLEASE ANY OF THE EQUIPMENT OR GRANT ANY
RIGHTS TO THE EQUIPMENT WITHOUT THE PRIOR WRITTEN CONSENT OF LESSOR. No
permitted assignment or sublease shall relieve Lessee of any of its obligations
under the Lease and Lessee agrees to pay all costs and expenses Lessor may incur
in connection with such sublease or assignment. Lessee grants to Lessor the
right of first refusal on any sublease or grant of Lessee's rights to the
Equipment.
9. DISCLAIMER OF WARRANTIES
a. LESSOR LEASES THE EQUIPMENT "AS IS", AND BEING NEITHER THE MANUFACTURER OF
THE EQUIPMENT NOR THE AGENT OF EITHER THE MANUFACTURER OR SELLER, LESSOR
DISCLAIMS ANY REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, WITH
RESPECT TO THE CONDITION OR PERFORMANCE OF THE EQUIPMENT, ITS MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE OR WITH RESPECT TO PATENT INFRINGEMENTS OR THE
LIKE. LESSOR SHALL HAVE NO LIABILITY TO LESSEE FOR ANY CLAIM, LOSS OR DAMAGE OF
ANY KIND OR NATURE WHATSOEVER INCLUDING THE ACTIVE OR PASSIVE NEGLIGENCE OR
STRICT LIABILITY OF LESSOR, NOR SHALL THERE BE ANY ABATEMENT OF RENTAL FOR ANY
REASON INCLUDING CLAIMS ARISING OUT OF OR IN CONNECTION WITH (i) THE DEFICIENCY
OR INADEQUACY OF THE EQUIPMENT FOR ANY PURPOSE, WHETHER OR NOT KNOWN OR
DISCLOSED TO LESSOR, (ii) ANY DEFICIENCY OR DEFECT IN THE EQUIPMENT, (iii) THE
USE OR PERFORMANCE OF THE EQUIPMENT, OR (iv) ANY LOSS OF BUSINESS OR OTHER
CONSEQUENTIAL LOSS OR DAMAGE RESULTING FROM ANY OF THE FOREGOING.
b. For the term of the Lease, Lessor assigns to Lessee (to the extent possible),
and Lessee may have the benefit of, any and all manufacturer's warranties,
service agreements and patent indemnities, if any, with respect to the
Equipment; provided, however, that Lessee's sole remedy for the breach of any
such warranty, indemnification or service agreement shall be against the
manufacturer of the Equipment and not against Lessor, nor shall any such breach
have any effect whatsoever on the rights and obligations of Lessor or Lessee
with respect to the Lease.
10. ASSIGNMENT
a. Lessee acknowledges and understands that Lessor may assign to a successor,
lender or purchaser (the "Assignee"), all or any part of the Lessor's right,
title and interest in and to the Lease and the Equipment and Lessee consents to
such assignment. In the event Lessor transfers or assigns, or retransfers or
reassigns, to an Assignee all or part of Lessor's interest in the Lease, the
Equipment or any sums payable under the Lease, whether as collateral security
for loans or advances made or to be made to Lessor by such Assignee or
otherwise, Lessee covenants that, upon receipt of notice of any such transfer or
assignment and instructions from Lessor, (i) Lessee shall, if so instructed, pay
and perform its obligations under the Lease to the Assignee (or to any other
party designated by Assignee), and shall not assign the Lease or any of its
rights under the Lease or permit the Lease to be amended, modified or terminated
without the prior written consent of Assignee. (ii) Lessee's obligations under
the Lease with respect to Assignee shall be absolute and unconditional and not
be subject to any abatement, reduction, recoupment, defense, offset or
counterclaim for any reason, alleged or proven, including, but not limited to,
defect in the Equipment, the condition, design, operation or fitness for use of
the Equipment or any loss or destruction or obsolescence of the Equipment or any
part, the prohibition of or other restrictions against Lessee's use of the
Equipment, the interference with such use by any person or entity, any failure
by Lessor to perform any of its obligations contained in the Lease, any
insolvency or bankruptcy of Lessor, or for any other cause, (iii) Lessee shall,
upon request of Lessor, submit such documents and certificates as may be
reasonably required by Assignee to secure and complete such transfer or
assignment, including but not limited to the documents set forth in Section
15(c) of this Master Agreement. (iv) Lessee shall deliver to Assignee copies of
any notices which are required under the Lease to be sent to Lessor; and (v)
Lessee shall, if requested, restate to Assignee the representations, warranties
and covenants contained in the Lease (upon which Lessee acknowledges Assignee
may rely) and shall make such other representations, warranties and covenants to
Assignee as may be reasonably required to give effect to the assignment.
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Master Agreement No. 673
▇. ▇▇▇▇▇▇ shall not make an assignment or transfer to any Assignee who shall not
agree that, so long as Lessee is not in default under the Lease, including but
not limited to a default in the payment of rent to Assignee pursuant to a notice
of assignment, such Assignee shall take no action to interfere with Lessee's
quiet enjoyment and use of the Equipment in accordance with the terms of the
Lease. No such assignment or conveyance shall relieve Lessor of its obligations
under the Lease and Lessee agrees it shall not look to any Assignee to perform
any of Lessor's obligations under the Lease.
11. QUIET ENJOYMENT
Lessor covenants that so long as Lessee is not in default under a Lease Lessee
will quietly possess the Equipment subject to and in accordance with the
provisions of the Lease.
12. INDEMNIFICATION
Lessee shall and does agree to indemnify, protect, save and keep harmless
Lessor, its agents, successors and assigns, from and against any and all
liabilities, obligations, losses, damages, penalties, claims, actions, suits,
costs, or expenses (including legal fees and expenses) of any kind and nature
whatsoever which may be imposed upon, incurred by or asserted against Lessor or
its respective agents, successors, or assigns, in any way relating to or arising
out of the Lease, the manufacture, purchase, acceptance, rejection, return,
ownership, lease, disposition, installation, delivery, possession, use,
condition, operation, or accident in connection with the Equipment (including,
without limitation, those claims based on latent and other defects, whether or
not discoverable, or claims based on strict liability, or any claim for patent,
trademark or copyright infringement). Lessor's rights arising from this Section
shall survive the expiration or other termination of the Lease.
13. RISK OF LOSS
a. Unless otherwise provided for in the Schedule, Lessee assumes and shall bear
the entire risk of loss and damage, whether or not insured against, of the
Equipment from any and every cause whatsoever as of the date the Equipment is
delivered to Lessee.
b. In the event of loss or damage of any kind to any Item, Lessee shall use all
reasonable efforts to place the Item in good repair, condition and working order
to the reasonable satisfaction of Lessor within 90 days of such loss or damage,
unless the manufacturer of the Equipment determines that such Item has been
irreparably damaged, in which case Lessee shall, within 10 days of the
manufacturer's determination of irreparable loss, make its election to either
pay Lessor the Stipulated Loss Value (as set forth in Attachment A to this
Master Agreement) for the irreparably damaged Item or replace the irreparably
damaged Item, all as provided in this Section. To the extent that the Item is
damaged but not irreparably damaged and if Lessee is entitled, pursuant to the
insurance coverage, to obtain proceeds from such insurance for the repair of the
Item, Lessee may arrange for the disbursement of such proceeds to pay the cost
of repair.
c. In the event that Lessee elects to pay Lessor the Stipulated Loss Value for
the irreparably damaged Item, Lessee shall (i) pay such amount (computed as of
the first day of the month following the determination of the irreparable damage
by the manufacturer) to Lessor on the first day of the month following the
election by Lessee as provided in (b) above, (ii) pay all Base Monthly Rental
for the Equipment up to the date that the Stipulated Loss Value is paid to
Lessor; and (iii) arrange, with the consent of Lessor, for the disposition of
the irreparably damaged Item with the insurance company paying the Lessee or
Lessor the proceeds relating to the irreparably damaged Item. If not all the
Equipment is irreparably damaged, the original list price of the irreparably
damaged Item shall be multiplied by the applicable percentage set forth in Annex
A to compute the Stipulated Loss Value for such irreparably damaged Item, and
the Base Monthly Rental for the undamaged Equipment remaining due (after payment
of the Stipulated Loss Value for the irreparably damaged Item) shall be that
amount resulting from multiplying the original Base Monthly Rental by the ratio
of the original list price of the undamaged Equipment divided by the original
list price for all the Equipment prior to the damage.
d. If Lessee elects to replace the irreparably damaged Item, Lessee shall
continue all payments under the Lease without interruption, as if no such
damage, loss or destruction had occurred, and shall replace such irreparably
damaged Item, paying all such costs associated with the replacement. Lessee
shall within 20 days following the date of determination of irreparable damage
by the manufacturer, effect the replacement by replacing the irreparably damaged
Item with replacement equipment so that Lessor has good and valid title to such
replacement equipment. The "Replacement Item" or "Replacement Equipment" shall
have a fair market value at the time of such replacement equal to the then fair
market value of the Equipment or Items thereof for which replacement is made,
and anticipated to have a fair market value at the expiration of the Base Term
equal to the fair market value which the Equipment or Items for which
replacement is made would have had at the end of the Base Term, and (i) be the
same type and of at least equal capacity to the Equipment for which the
replacement is being made. Upon delivery, such Replacement Equipment shall
become subject to all of the terms and conditions of the Lease. Lessee shall
execute all such documents necessary to effect the foregoing.
e. For the purpose of the Lease, the term "fair market value" shall mean the
price that would be obtained in an arm's-length transaction between an informed
and willing buyer-user under no compulsion to buy or lease and an informed and
willing seller-lessor under no compulsion to sell or lease. If Lessor and Lessee
are unable to agree upon fair market value, such value shall be determined, at
Lessee's expense, in accordance with the foregoing definition, by three
independent appraisers, one to be appointed by Lessee, one to be appointed by
Lessor and the third to be appointed by the first two.
14. INSURANCE
During the term of the Lease, Lessee, at its own expense, shall maintain in
regard to the Equipment all risk and comprehensive public liability insurance in
amounts and with carriers reasonably satisfactory to Lessor. Any such insurance
shall name Lessor and the Assignee as additional insureds and, as for the all
risk insurance, loss payees as their interest may appear. All such insurance
shall provide that it may not be terminated, canceled or altered without at
least 30 days' prior written notice to Lessor and its successors and assigns.
Coverage afforded to Lessor shall not be rescinded, impaired, or invalidated by
any act or neglect of Lessee. Lessee agrees to supply to Lessor, upon request,
evidence of such insurance.
15. REPRESENTATIONS AND WARRANTIES OF LESSEE, FINANCIAL STATEMENTS
a. Lessee represents and warrants to Lessor and its successors and assigns (i)
that the execution, delivery and performance of this Master Agreement and the
Lease was duly authorized and that upon execution of this Master Agreement and
the Lease by Lessee and
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Master Agreement No. 673
Lessor, the Master Agreement and the Lease will be in full force and effect and
constitute a valid legal and binding obligation of Lessee, and enforceable
against Lessee in accordance with their respective terms; (ii) the Equipment
subject to the Lease is accurately described in the Lease and all documents of
Lessee relating to the Lease; (iii) that Lessee is in good standing in the
jurisdiction of its incorporation and in any jurisdiction in which any of the
Equipment is located; (iv) that no consent or approval of, giving of notice to,
registration with, or taking of any other action in respect of, any state,
federal or other government authority or agency is required with respect to the
execution, delivery and performance by the Lessee of this Master Agreement or
the Lease or, if any such approval, notice, registration or action is required,
it has been obtained; (v) that the entering into and performance of this Master
Agreement and the Lease will not violate any judgment, order, law or regulation
applicable to Lessee or any provision of Lessee's Articles of Incorporation or
By-Laws or result in any breach of, or constitute a default under, or result in
the creation of any lien, charge, security interest or other encumbrance upon
any assets of Lessee or upon the Equipment pursuant to any instrument to which
Lessee is a party or by which it or its property may be bound; (vi) there are no
actions, suits or proceedings pending, or to the knowledge of Lessee,
threatened, before any court or administrative agency, arbitrator or
governmental body which will, if determined adversely to Lessee, materially
adversely affect its ability to perform its obligations under the Lease or any
related agreement to which it is a party; (vii) that aside from the Master
Agreement, the Lease and the Warrant Agreement there are no additional
agreements between Lessee and Lessor relating to the Equipment; and (viii) that
any and all financial statements and other information with respect to Lessee
supplied to Lessor at the time of execution of the Lease and any amendments, are
true and complete. The foregoing representations and warranties shall survive
the execution and delivery of the Lease and any amendments hereto and shall upon
the written request of Lessor, be made to Lessor's successors and assigns.
b. Prior to and during the term of the Lease, Lessee will furnish Lessor, when
reasonably available, with Lessee's audited financial statements. If Lessee is a
subsidiary of another company, Lessee shall supply such company's financial
statements and guarantees as are reasonably acceptable to Lessor. For income tax
purposes, Lessor and Lessee agree to treat the Schedule(s) as finance leases.
Lessee shall also provide Lessor with such other statements concerning the Lease
and the condition of the Equipment as Lessor may from time to time request.
c. Upon Lessor's request, Lessee shall, with respect to each Lease, deliver to
Lessor (i) a certificate of a secretarial officer of Lessee certifying the
by-law, resolution (specific or general) or corporate action authorizing the
transactions contemplated in the Lease; (ii) an incumbency certificate
certifying that the person signing this Master Agreement and the Lease holds the
office the person purports to hold and has authority to sign on behalf of
Lessee; (iii) an opinion of Lessee's counsel with respect to the representations
in Section 15(a); (iv) an agreement with Lessor's Assignee with regard to any
assignment as referred to in Section 10; (v) the purchase documents if Lessee
has sold or assigned its interest in the Equipment to Lessor; (vi) an insurance
certificate evidencing any insurance provided by Lessee pursuant to Section 14;
and (vii) an acceptance certificate in a form reasonably acceptable to Lessor
and duly executed by Lessee. Failure by Lessee to deliver any of these documents
when reasonably due shall operate, at Lessor's option, to continue the
Installation Term for the Lease thus delaying the Base Term Commencement Date,
or to increase the Base Monthly Rental to recover costs incurred by Lessor
consequent to the delay, or to terminate the Lease as provided in Section 16.
16. DEFAULT, REMEDIES
a. The following shall be deemed "Events of Default" under the Lease: (i) Lessee
fails to pay any installment of rent or other charge within 10 days of the date
such payment is due; or (ii) Except as expressly permitted in the Lease, Lessee
attempts to remove, sell, encumber, assign or sublease or fails to insure any of
the Equipment, or fails to deliver any documents required of Lessee under the
Lease; or (iii) Any representation or warranty made by Lessee or Lessee's
guarantor in the Lease or any document supplied in connection with the Lease or
any financial statement is misleading or materially inaccurate; or (iv) Lessee
fails to observe or perform any of the other obligations required to be observed
or performed by Lessee under the Lease within 30 days of Lessee's first
knowledge of such failure; or, if more than 30 days are reasonably required to
cure such failure, Lessee fails to commence and to continue to diligently
perform such obligations within such 30 days; or (v) Lessee or Lessee's
guarantor ceases doing business as a going concern; makes an assignment for the
benefit of creditors; admits in writing its inability to pay its debts as they
become due; files a voluntary petition in bankruptcy; is adjudicated a bankrupt
or an insolvent; files a petition seeking for itself any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
arrangement under any present or future statute, law or regulation or files an
answer admitting or fails to deny the material allegations of a petition filed
against it in any such proceeding; consents to or acquiesces in the appointment
of a trustee, receiver, or liquidator for it or of all or any substantial part
of its assets or properties, or if it or its trustee, receiver, liquidator or
shareholders shall take any action to effect its dissolution or liquidation; or
(vi) If within 30 days after the commencement of any proceedings against Lessee
or Lessee's guarantor seeking reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any present or
future statute, law or regulation, such proceedings shall not have been
dismissed, or if within 30 days after the appointment (with or without Lessee's
or Lessee's guarantor's consent) of any trustee, receiver or liquidator of it or
of all or any substantial part of its respective assets and properties, such
appointment shall not be vacated.
b. Upon the happening of any Event of Default, Lessor may declare the Lessee in
default. Lessee authorizes Lessor at any time thereafter to enter any premises
where the Equipment may be and take possession of the Equipment. Lessee shall,
without further demand, immediately pay Lessor an amount which is equal to (i)
any unpaid amount due on or before Lessor declared the Lease to be in default,
plus (ii) as liquidated damages for loss of a bargain and not as a penalty, an
amount equal to the Stipulated Loss Value for the Equipment computed as of the
date Lessor declares the Lease in default, together with interest, as provided
herein, plus (iii) all attorney and court costs incurred by Lessor relating to
the enforcement of its rights under the Lease. In the Event of Default, at the
request of Lessor and to the extent requested by Lessor, Lessee shall
immediately comply with the provisions of Section 6(d). Lessor may sell the
Equipment at private or public sale, in bulk or in parcels, with or without
notice, without having the Equipment present at the place of sale; or Lessor may
lease, otherwise dispose of or keep idle all or part of the Equipment, subject,
however, to its obligation to mitigate damages; and Lessor may use Lessee's
premises for any or all of the foregoing. The proceeds of sale, lease or other
disposition, if any, of the Equipment
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Master Agreement No. 673
shall be applied (1) to all Lessor's costs, charges and expenses incurred in
taking, removing, holding, repairing and selling, leasing or otherwise disposing
of the Equipment including attorney fees; then (2) to the extent not previously
paid by Lessee, to pay Lessor the Stipulated Loss Value for the Equipment and
all other sums owed by Lessee under the Lease, including any unpaid rent and
indemnities then remaining unpaid under the Lease; then (3) to reimburse to
Lessee any such sums previously paid by Lessee as liquidated damages; (4) any
surplus shall be retained by Lessor. Lessee shall pay any deficiency in (1) and
(2) immediately. The exercise of any of the foregoing remedies by Lessor shall
not constitute a termination of the Lease unless Lessor so notifies Lessee in
writing. Lessor may also proceed by appropriate court action, either at law or
in equity to enforce performance by Lessee of the applicable covenants of the
Lease or to recover damages for the breach of the Lease.
c. The waiver by Lessor of any breach of any obligation of Lessee shall not be
deemed a waiver of any future breach of the same or any other obligation. The
subsequent acceptance of rental payments under the Lease by Lessor shall not be
deemed a waiver of any such prior existing breach at the time of acceptance of
such rental payments. The rights afforded Lessor under Section 16 shall be
cumulative and concurrent and shall be in addition to every other right or
remedy provided for in the Lease or now or later existing in law (including as
appropriate all the rights of a secured party or lessor under the Uniform
Commercial Code) or in equity and Lessor's exercise or attempted exercise of
such rights or remedies shall not preclude the simultaneous or later exercise of
any or all other rights or remedies.
d. In the event Lessee shall fail to perform any of its obligations under the
Lease, then Lessor, in addition to all of its rights and remedies under the
Lease, may perform the same, but shall not be obligated to do so, at the cost
and expense of Lessee. In any such event, Lessee shall promptly reimburse Lessor
for any such costs and expenses incurred by Lessor.
17. GENERAL
a. The Lease shall be deemed to have been made and delivered in the Commonwealth
of Massachusetts and shall be governed in all respects by the laws of such
state.
b. The Master Agreement, the Lease (including the Exhibits and Schedules
thereto) and the Warrant Agreement constitute the entire and only agreement
between Lessee and Lessor with respect to the Equipment. The covenants,
conditions, terms and provisions may not be waived or modified orally and shall
supersede all previous proposals, both oral and written, negotiations,
representations, commitments, writings or agreements or any other communication
between the parties. The Lease may not be amended or discharged except by a
subsequent written agreement entered into by duly authorized representatives of
Lessor and Lessee.
c. All notices, covenants or requests desired or required to be given under the
Lease shall be in writing and shall be delivered in person or sent by certified
mail, return receipt requested, or by courier service to the address of the
other party set forth in the introduction of the Master Agreement or to such
other address as such party shall have designated by proper notice.
d. Each Lease may be executed in one or more counterparts, each of which shall
be deemed an original, but there shall be a single executed original of each
Lease which shall be marked "Counterpart No. 1" (the "Original"); all other
counterparts shall be marked "Counterpart No. 2 and Counterpart No. 3". To the
extent, if any, that a Lease constitutes chattel paper (as such term is defined
in the Uniform Commercial Code) no security interest in the Lease may be created
through the transfer or possession of any counterpart other than the Original.
e. Section headings are for convenience only and shall not be construed as part
of the Lease.
f. It is expressly understood that all of the Equipment shall be and remain
personal property, notwithstanding the manner in which the same may be attached
or affixed to realty, and Lessee shall do all acts and enter into all agreements
necessary to assure Lessor that the Equipment remains personal property and that
the respective interests of Lessor and its assignees are protected and
represented. Lessor may upon written notice to Lessee inform Lessee that certain
items supplied to Lessee are leased to Lessor and are supplied to Lessee under
the Lease as a sublease. Lessee agrees to execute and deliver such
acknowledgments and assignments in connection with such a Lease as are
reasonably required.
g. If, at any time during the term of the Lease, Lessor's right to lease the
Equipment expires, Lessor may remove the Equipment from Lessee's premises and
shall promptly provide identical substitute Equipment. All expenses of such
substitution, including de-installation, installation and transportation
expenses, shall be borne by Lessor.
h. The obligations of Lessor hereunder shall be suspended to the extent that it
is hindered or prevented from complying therewith because of labor disturbances,
including strikes and lockouts, acts of God, fires, storms, accidents, failure
to deliver any Unit of Equipment, governmental regulations or interferences or
any cause whatsoever not within the sole control of Lessor.
i. Any provision of the Master Lease or any Schedule prohibited by or unlawful
or unenforceable under any applicable law or any jurisdiction shall, at the sole
option of the Lessor, be ineffective as to such jurisdiction without
invalidating the remaining provisions of the Master Agreement and such Schedule.
j. Lessee agrees not to discriminate against any employee or applicant for
employment because of race, color, religion, sex, national origin, handicap, or
status as disabled or Vietnam veteran and shall during the performance of this
contract comply with all applicable Executive Orders and federal regulations
which are deemed to be incorporated by reference into this contract.
The parties have executed this Master Agreement of Terms and Conditions for
Lease as of the date written below.
LESSOR: TLP LEASING PROGRAMS, INC. LESSEE: BIG ENTERTAINMENT, INC.
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Name: ___________________________ Name:___________________________
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