EXHIBIT 10.9
MASTER EQUIPMENT LEASE NO. 0053
Under this Master Equipment Lease No. 0053 (the "Lease"), dated as of
December 15, 1996, Phoenix Leasing Incorporated, a California corporation
("Lessor"), hereby leases to Newgen Results Corporation, a California
corporation ("Lessee"), and Lessee hereby leases from Lessor, the equipment
(herein called "Equipment") which is described on the schedule attached
hereto or any subsequently-executed schedule entered into by Lessor and
Lessee and which incorporates this Lease by reference. Any such schedules
shall hereinafter individually be referred to as a "Schedule" and
collectively be referred to as the "Schedules." Lessor hereby leases the
Equipment to Lessee upon the following terms and conditions:
1. TERM OF AGREEMENT. The term of this Lease begins on the date
set forth above and shall continue thereafter and be in effect so long as and
at any time any Schedule entered into pursuant to this Lease is in effect.
The Initial Term and rent payable with respect to each leased item of
Equipment shall be as set forth in and as stated in the respective
Schedule(s). The terms of each Schedule hereto are subject to all conditions
and provisions of this Lease as it may at any time be amended. Each Schedule
shall constitute a separate and independent lease and contractual obligation
of Lessee and shall incorporate the terms and conditions of this Master
Equipment Lease and any additional provisions contained in such Schedule. In
the event of a conflict between the terms and conditions of this Lease and any
additional provisions of such Schedule, the additional provisions of such
Schedule shall prevail with respect to such Schedule only.
2. NON-CANCELLABLE LEASE. This Lease and any Schedule cannot be
cancelled or terminated except as expressly provided herein. This Lease
(including all Schedules to this Lease) constitutes a net lease and Lessee
agrees that its obligations to pay all rent and other sums payable hereunder
(and under any Schedule) and the rights of Lessor and assignee in and to such
rent and other sums, are absolute and unconditional and are not subject to
any abatement, reduction, setoff, defense, counterclaim or recoupment due or
alleged to be due to, or by reason of, any past, present or future claims
which Lessee may have against Lessor, any assignee, the manufacturer or
seller of the Equipment, or against any person or any reason whatsoever.
3. LESSOR COMMITMENT. So long as no Event of Default or event
which with the giving of notice or passage of time, or both, could become an
Event of Default has occurred or is continuing, Lessor agrees to lease to
Lessee the groups of Equipment described on each Schedule, subject to the
following conditions: (i) that in no event shall Lessor be obligated to lease
Equipment to Lessee hereunder where the aggregate purchase price of all
Equipment leased to Lessee hereunder would exceed $1,500,000 ("Commitment")
of which amount Lessor may purchase custom use equipment, installation and
delivery costs, purchase tax, tooling, software, and items generally
considered fungible or expendable ("Soft Cost Equipment") for lease to Lessee
having an aggregate purchase price not exceeding an amount equal to 20% of
the Commitment; (ii) the amount of Equipment purchased by Lessor at any one
time shall be at least equal to $25,000 except for a final advance which may
be less than $25,000, provided that the ratio of aggregate Soft Cost to
non-Soft Cost Equipment theretofore purchased by Lessor as of each funding
shall not exceed 1 to 5; (iii) Lessor shall not be obligated to purchase
Equipment hereunder after December 31, 1997; (iv) all Lease documentation
except for Schedule documentation required by Lessor has been executed by
Lessee or provided by Lessee no later than December 31, 1996; (v) the
equipment described on the Schedule is reasonably acceptable to Lessor; (vi)
with respect to each funding Lessee has provided to Lessor each of the
closing documents and other items described in Exhibit A hereto (which
documents shall be in form and substance acceptable to Lessor) and which list
may be modified for each subsequent
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funding; (vii) there is no material adverse change in Lessee's condition,
financial or otherwise, as determined by Lessor, and Lessee so certifies,
from (yy) the date of the most recent financial statements delivered by
Lessee to Lessor prior to execution of this Lease, to (zz) the date of the
proposed lease of the Equipment; (viii) Lessee is performing in a manner not
adversely material to its business plan referred to as "Newgen Results
Corporation: Projected Balance Sheets, Projected Income Statement, Projected
Cash Flow Statement from August to December 1996, and Projected Balance
Sheets, Projected Income Statements, Projected Cash Flow Statement from
January to December 1997," not dated as may be amended from time to time in
form and substance acceptable to Lessor ("Business Plan"); (ix) Lessor or its
agent has inspected and placed identification labels on the Equipment; (x)
Lessee shall offer to Lessor, on an exclusive basis, all lease transactions
for equipment contemplated by Lessee until expiration of all Schedules;
however if Lessor declines to finance any such transaction or Lessee and
Lessor cannot agree upon terms, then Lessee shall be free to seek such
financing from any other third party; and (xi) Lessor has received in form
and substance acceptable to Lessor: (a) Lessee's interim financial statements
signed by a financial officer of Lessee; and (b) evidence of Lessee's
$1,499,455 cash position as of August 31, 1996.
4. NO WARRANTIES BY LESSOR. (a) Lessee has selected both (i) the
Equipment and (ii) the suppliers (herein called "Vendor") from whom Lessor is
to purchase the Equipment. LESSOR MAKES NO WARRANTY EXPRESS OR IMPLIED AS TO
ANY MATTER WHATSOEVER, INCLUDING THE CONDITION OF THE EQUIPMENT, ITS
MERCHANTABILITY OR ITS FITNESS FOR ANY PARTICULAR PURPOSE, AND AS TO LESSOR,
LESSEE LEASES THE EQUIPMENT "AS IS" AND WITH ALL FAULTS. (b) If the Equipment
is not properly installed, does not operate as represented or warranted by
Vendor or is unsatisfactory for any reason, Lessee shall make any claim on
account thereof solely against Vendor and shall, nevertheless, pay Lessor all
rent payable under this Lease, Lessee hereby waiving any such claims as
against Lessor. Lessor hereby agrees to assign to Lessee solely for the
purpose of making and prosecuting any said claim, to the extent assignable,
all of the rights which Lessor has against Vendor for breach of warranty or
other representation respecting the Equipment. Lessor shall have no
responsibility for delay or failure to fill the order. (c) Lessee understands
and agrees that neither the Vendor nor any salesman or other agent of the
Vendor is an agent of Lessor. No salesman or agent of Vendor is authorized to
waive or alter any term or condition of this Lease, and no representation as
to the Equipment or any other matter by the Vendor shall in any way affect
Lessee's duty to pay the rent and perform its other obligations as set forth
in this Lease. (d) Lessee hereby requests Lessor to purchase Equipment from
Vendor and to lease Equipment to Lessee on the terms and conditions of the
Lease set forth herein. (e) Lessee hereby authorizes Lessor to insert in this
Lease and each Schedule hereto the serial numbers and other identification
data of the Equipment when determined by Lessor.
5. LESSEE'S REPRESENTATIONS AND WARRANTIES. Lessee represents and
warrants that (a) it is a corporation in good standing under the laws of
the state of its incorporation, and duly qualified to do business, and will
remain duly qualified during the term of this Lease, in each state where the
Equipment will be located, as specified on each Schedule hereto; (b) it has
full authority to execute and deliver this Lease and perform the terms
hereof, and this Lease has been duly authorized and constitutes valid and
binding obligations of Lessee enforceable in accordance with its terms; (c)
this Lease will not contravene any law, regulation or judgment affecting
Lessee or result in any breach of any agreement or other instrument binding
on Lessee; (d) no consent of Lessee's shareholders or holder of any
indebtedness, or filing with, or approval of, any governmental agency or
commission, is a condition to the performance of the terms hereof; (e) there
is no action or proceeding pending or threatened against Lessee before any
court or administrative agency which might have a materially adverse effect
on the business, financial condition
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or operations of Lessee; (f) no deed of trust, mortgage or third party
interest arising through Lessee will attach to the Equipment or the Lease;
(g) the Equipment will remain at all times under applicable law, removable
personal property, free and clear of any lien or encumbrance in favor of
Lessee or any other person, notwithstanding the manner in which the Equipment
may be attached to any real property; (h) all credit, financial and any other
information submitted to Lessor herewith or any other time is true and
correct; and (i) Lessee has provided, or will provide if requested, Lessee's
tax identification number.
6. EQUIPMENT ORDERING. Lessee shall be responsible for all packing,
rigging, transportation and installation charges for the Equipment and Lessor
may separately invoice Lessee for such charges. Lessee has selected the
Equipment itself and shall arrange for delivery of Equipment so that it can
be accepted in accordance with Section 7 hereof. Lessee hereby agrees to
indemnify and hold Lessor harmless from any claims, liabilities, costs and
expenses, including reasonable attorneys' fees, incurred by Lessor arising
out of any purchase orders or assignments executed by Lessor with respect to
any Equipment or services relating thereto.
7. LESSEE ACCEPTANCE. Lessee shall return to Lessor the signed and
dated Acceptance Notice attached to each Schedule hereto (a) acknowledging
the Equipment has been received, installed and is ready for use and (b)
accepting it as satisfactory in all respects for the purposes of this Lease.
Lessor is authorized to fill in the Rent Start Date on each Schedule in
accordance with the foregoing.
8. LOCATION; INSPECTION; LABELS. Equipment shall be delivered to and
shall not be removed from the Equipment "Location" shown on each Schedule
without Lessor's prior written consent, which "Location" shall in all events
be within the United States. Lessor shall have the right to inspect Equipment
at any reasonable time. Lessee shall be responsible for all labor, material
and freight charges incurred in connection with any removal or relocation of
such Equipment which is requested by the Lessee and consented to by Lessor,
as well as for any charges due to the installation or moving of the
Equipment. The rental payments shall continue during any period in which the
Equipment is in transit during a relocation. Lessor or its agent shall ▇▇▇▇
and label Equipment, which labels shall state Equipment is owned by Lessor,
and Lessee shall keep such labels on the Equipment as labeled by Lessor or
its agent.
9. EQUIPMENT MAINTENANCE. (a) GENERAL. Lessee will locate or base each
item of Equipment where designated in an Acceptance Notice and will
reasonably permit Lessor to inspect such item of Equipment and its
maintenance records. Lessee will at its sole expense comply with all
applicable laws, rules, regulations, requirements and orders with respect to
the use, maintenance, repair, condition, storage and operation of each item
of Equipment. Except as required herein, Lessee will not make any addition or
improvement to any item of Equipment that is not readily removable without
causing material damage to any item or impairing its original value or
utility. Any addition or improvement that is so required or cannot be so
removed will immediately become the property of Lessor. (b) SERVICE AND
REPAIR. Lessee shall have the Equipment certified for the Vendor's standard
maintenance agreement prior to delivery to Lessor upon expiration of this
Lease. With respect to any other Equipment, Lessee will, at its sole expense,
maintain and service, and repair any damage to, each item of Equipment in a
manner consistent with prudent industry practice and Lessee's own practice so
that such item of Equipment is at all times (i) in the same condition as when
delivered to Lessee, except for ordinary wear and tear, (ii) in good
operating order for the function intended by its manufacturer's warranties
and recommendations.
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10. LOSS OR DAMAGE. Lessee assumes the entire risk of loss to the
Equipment through use, operation or otherwise. Lessee hereby indemnifies and
holds harmless Lessor from and against all claims, loss of rental payments,
costs, damages, and expenses relating to or resulting from any loss, damage or
destruction of the Equipment, any such occurrence being hereinafter called a
"Casualty Occurrence." On the first rental payment date following such
Casualty Occurrence, or, if there is no such rental payment date, thirty (30)
days after such Casualty Occurrence, Lessee shall (i) repair the Equipment,
returning it to good operating condition or (ii) replace the Equipment with
identical equipment in good condition and repair, the title to which shall
vest in Lessor and which thereafter shall be subject to the terms of this
Lease; or (iii) pay to Lessor (a) any unpaid accrued amounts relating to such
Equipment due Lessor under this Lease up to the date of the Casualty
Occurrence, and (b) a sum equal to the Casualty Value as set forth in the
Casualty Value table attached to each Schedule hereto for such Equipment.
Upon the making of such payment, the term of this Lease as to each unit of
Equipment with respect to which the Casualty Value was paid shall terminate.
11. GENERAL INDEMNITY. Lessee will protect, indemnify and save
harmless Lessor from and against all liabilities, obligations, claims,
damages, penalties, causes of action, costs and expenses, imposed upon or
incurred by or asserted against Lessor or any assignee of Lessor by Lessee or
any third party by reason of the occurrence or existence (or alleged
occurrence or existence) of any act or event relating to or caused by the
Equipment, including but not limited to, consequential or special damages of
any kind, or any failure on the part of Lessee to perform or comply with any
of the terms of this Lease. In the event that any action, suit or proceeding
is brought against Lessor by reason of any such occurrence, Lessee, upon
request of Lessor, will at Lessee's expense resist and defend such action,
suit or proceeding or cause the same to be resisted and defended by counsel
designated and approved by Lessor. Lessee's obligations under this Section 11
shall survive the expiration of this Lease with respect to acts or events
occurring or alleged to have occurred prior to the return of the Equipment to
Lessor at the end of the Lease term.
12. INSURANCE. Lessee at its expense shall keep the Equipment
insured for the entire term and any extensions of this Lease against all
risks for at least the replacement value of such Equipment and shall provide
for a loss payable endorsement to Lessor or any assignee of Lessor. Lessee
shall maintain comprehensive general public liability insurance with respect
to loss or damage for personal injury, death or property damage in an amount
not less than $2,000,000 per occurrence, naming Lessor and Lessor's assignee
as additional insured. Such insurance shall contain insurer's agreement to
give thirty (30) days written notice to Lessor before cancellation or
material change of any policy of insurance. Lessee will provide Lessor and
any assignee of Lessor with a certificate of insurance from the insurer
evidencing Lessor's or such assignee's interest in the policy of insurance.
Such insurance shall cover any Casualty Occurrence to any unit of Equipment.
Notwithstanding anything in Section 10 or this Section 12 to the contrary,
this Lease and Lessee's obligations hereunder and under each Schedule shall
remain in full force and effect with respect to any unit of Equipment which
is not subject to a Casualty Occurrence. If Lessee fails to provide or
maintain insurance as required herein, Lessor shall have the right, but shall
not be obligated to obtain such insurance. In that event, Lessee shall pay to
Lessor the cost thereof.
13. TAXES. Lessee agrees to reimburse Lessor for, (or pay directly
if instructed by Lessor), and agrees to indemnify and hold Lessor harmless
from, all fees (including, but not limited to, license, documentation,
recording and registration fees), and all sales, use, gross receipts,
personal property, occupational, value added or other taxes, levies, imposts,
duties, assessments, charges, or withholdings of any nature whatsoever,
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together with any penalties, fines, additions to tax, or interest thereon
(all of the foregoing being hereafter referred to as "Impositions") except
same as may be attributable to Lessor's income, arising at any time prior to
or during the term of this Lease, or upon termination or early termination of
this Lease and levied or imposed upon Lessor directly or otherwise by any
Federal, state or local government in the United States or by any foreign
country or foreign or international taxing authority upon or with respect to
(i) the Equipment, (ii) the exportation, importation, registration, purchase,
ownership, delivery, leasing, possession, use, operation, storage,
maintenance, repair, return, sale, transfer of title, or other disposition
thereof, (iii) the rentals, receipts, or earnings arising from the Equipment,
or any disposition of the rights to such rentals, receipts, or earnings, (iv)
any payment pursuant to this Lease, and (v) this Lease or the transaction or
any part thereof. Lessee's obligations under this Section 13 shall survive
the expiration of this Lease with respect to acts or events occurring or
alleged to have occurred prior to the return of the Equipment to Lessor at
the end of the Lease term.
14. PAYMENT BY LESSOR. If Lessee shall fail to make any payment or
perform any act required hereunder, then Lessor may, but shall not be
required to, after such notice to Lessee as is reasonable under the
circumstances, make such payment or perform such act with the same effect as
if made or performed by Lessee. Lessee will upon demand reimburse Lessor for
all sums paid and all costs and expenses incurred in connection with the
performance of any such act.
15. SURRENDER OF EQUIPMENT. Upon termination as a result of a
default of this Lease, with respect to each group of Equipment, Lessee will
forthwith surrender the Equipment to Lessor delivered in as good order and
condition as originally delivered, reasonable wear and tear excepted. Lessor
may, at its sole option, arrange for removal and transportation of the
Equipment provided that Lessee's obligations under Sections 10, 11 and 12
shall not be released. Lessee shall bear all expenses of delivering (which
include, but are not limited to, the de-installation, insurance, packaging and
transportation of) the Equipment to Lessor's location or other location
within the United States as Lessor may request. In the event Lessee fails to
deliver the Equipment as directed above, all obligations of Lessee under this
Lease, including rental payments, shall remain in full force and effect until
Lessee delivers the Equipment to Lessor.
16. ASSIGNMENT. WITHOUT LESSOR'S PRIOR WRITTEN CONSENT, SUCH
CONSENT NOT TO BE UNREASONABLY WITHHELD, LESSEE SHALL NOT (a) ASSIGN,
TRANSFER, PLEDGE, HYPOTHECATE OR OTHERWISE DISPOSE OF THIS LEASE, EQUIPMENT,
OR ANY INTEREST THEREIN, OR (b) SUBJECT OR LEND EQUIPMENT OR PERMIT IT TO BE
USED BY ANYONE OTHER THAN LESSEE OR LESSEE'S EMPLOYEES, CONTRACTORS OR
AGENTS. LESSOR MAY ASSIGN THIS LEASE OR GRANT A SECURITY INTEREST IN ANY OR
ALL EQUIPMENT, OR BOTH, IN WHOLE OR IN PART TO ONE OR MORE ASSIGNEES OR
SECURED PARTIES WITHOUT NOTICE TO LESSEE. If Lessee is given notice of such
assignment it agrees to acknowledge receipt thereof in writing and Lessee
shall execute such additional documentation as Lessor's assignee shall
require. Each such assignee and/or secured party shall have all of the
rights, but none of the obligations, of Lessor under this Lease, unless such
assignee or secured party expressly agrees to assume such obligations in
writing. Lessee shall not assert against any assignee and/or secured party
any defense, counterclaim or offset that Lessee may have against Lessor.
Notwithstanding any such assignment, and providing no Event of Default has
occurred and is continuing, Lessor, or its assignees, secured parties, or
their agents or assigns, shall not interfere with Lessee's right to quietly
enjoy use of Equipment subject to the terms and conditions of this Lease.
Subject to the foregoing, this Lease inures to the benefit of and is binding
upon the successors and assignees of the parties hereto. Lessee acknowledges
that any such assignment by Lessor will not materially change Lessee's duties
or obligations under the Lease or increase any burden of risk on Lessee.
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17. DEFAULT. (a) EVENT OF DEFAULT. Any of the following events
or conditions shall constitute an "Event of Default" hereunder: (i) Lessee's
failure to pay any monies due to Lessor hereunder or under any Schedule
beyond the fifth (5th) day after the same is due; (ii) Lessee's failure to
comply with its obligations under Section 12 or Section 16; (iii) Lessee's
failure to comply with or perform any term, covenant, condition, warranty or
representation of this Lease or any Schedule hereto or under any other
agreement between Lessee and Lessor or under any lease of real property
covering the location of Equipment if such failure to comply or perform is
not cured by Lessee within thirty (30) days of receipt of notice thereof;
(iv) seizure of the Equipment under legal process; (v) the filing by or
against Lessee of a petition for reorganization or liquidation under the
Bankruptcy Code of any amendment thereto or under any other insolvency law
providing for the relief of debtors; (vi) the voluntary or involuntary making
of an assignment of a substantial portion of its assets by Lessee, or any
guarantor ("Guarantor") under any guaranty executed in connection with this
Lease ("Guaranty"), for the benefit of its creditors, the appointment of a
receiver or trustee for Lessee or any Guarantor for any of Lessee's or
Guarantor's assets, the institution by or against Lessee or any Guarantor of
any formal or informal proceeding for dissolution, liquidation, settlement of
claims against or winding up of the affairs of Lessee or any Guarantor,
PROVIDED that in the case of all such involuntary proceedings, same are not
dismissed within sixty (60) days after commencement; or (vii) the making by
Lessee or any Guarantor of a transfer of all or a material portion of
Lessee's or Guarantor's assets or inventory not in the ordinary course of
business.
(b) REMEDIES. If any Event of Default shall have occurred:
(i) Lessor may proceed by appropriate court action or actions either
at law or in equity to enforce performance by Lessee, of the applicable
covenants of this Lease, or to recover damages therefor; or
(ii) Lessee will, without demand, on the next rent payment date
following the Event of Default, pay to Lessor as liquidated damages which the
parties agree are fair and reasonable under the circumstances existing at the
time this Lease is entered into, and not as a penalty, an amount equal to the
Casualty Value of the Equipment set forth in Exhibit C together with any rent
or other amounts past due and owing by Lessee hereunder; and
(iii) Lessor may, without notice to or demand upon Lessee;
(a) Take possession of the Equipment and lease or sell the same
or any portion thereof, for such period, amount, and to such entity as Lessor
shall elect. The proceeds of such lease or sale will be applied by Lessor (A)
first, to pay all costs and expenses,including reasonable legal fees and
disbursements, incurred by Lessor as a result of the default and the exercise
of its remedies with respect thereto, (B) second, to pay Lessor an amount
equal to any unpaid rent or other amounts past due and payable plus the
Casualty Value, to the extent not previously paid by Lessee,and (C) third, to
reimburse Lessee for the Casualty Value to the extent previously paid. Any
surplus remaining thereafter will be retained by Lessor.
(b) Take possession of the Equipment and hold and keep idle the
same or any portion thereof.
Lessee agrees to pay all internal and out-of-pocket costs
of Lessor related to the exercise of its remedies, including direct costs of
its in-house counsel
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and out-of-pocket legal fees and expenses. At Lessor's request, Lessee shall
assemble the Equipment and make it available to Lessor at such location as
Lessor may designate. Lessee waives any right it may have to redeem the
Equipment.
Repossession of any or all Equipment shall not terminate
this Lease or any Schedule unless Lesser notifies Lessee in writing. Any
amount required to be paid under this Section shall be increased by a service
charge at the rate of 2.0% per month, or the highest rate of interest
permitted by applicable law, whichever is less, accruing from the date the
Casualty Value or other amounts are payable hereunder until such amounts are
paid.
None of the above remedies is intended to be exclusive, but
each is cumulative and in addition to any other remedy available to Lessor,
and all may be enforced separately or concurrently.
18. LATE PAYMENTS. Lessee shall pay to Lessor an amount equal to
the greater of 10% of all amounts owed Lessor by Lessee which are not paid
when due or $100, but in no event an amount greater than the highest rate
permitted by applicable law. If such funds have not been received by Lessor
at Lessor's place of business or by Lessor's designated agent by the date
such funds are due under this Lease, Lessor shall ▇▇▇▇ Lessee for such
charges. Lessee acknowledges that invoices for rentals due hereunder are sent
by Lessor for Lessee's convenience only. Lessee's non-receipt of an invoice
will not relieve Lessee of its obligation to make rent payments hereunder.
19. LESSOR'S EXPENSE. Lessee shall pay Lessor all costs and
expenses including reasonable attorney's fees and the fees of the collection
agencies, incurred by Lessor in enforcing any of the terms, conditions or
provisions hereof.
20. OWNERSHIP; PERSONAL PROPERTY. The Equipment shall be and remain
personal property of Lessor, and Lessee shall have no right, title or
interest therein or thereto except as expressly set forth in this Lease,
notwithstanding the manner in which it may be attached or affixed to real
property, and upon termination or expiration of the Lease term, Lessee shall
have the duty and Lessor shall have the right to remove the Equipment from
the premises where the same be located whether or not affixed or attached to
the real property or any building, at the cost and expense of Lessee.
21. ALTERATIONS; ATTACHMENTS. No alterations or attachments shall
be made to the Equipment without Lessor's prior written consent, which shall
not be given for changes that will affect the reliability and utility of the
Equipment or which cannot be removed without damage to the Equipment, or
which in any way affect the value of the Equipment for purposes of resale or
re-lease.
22. FINANCING STATEMENT. Lessee will execute financing statements
pursuant to the Uniform Commercial Code. Lessee authorizes Lessor to file
financing statements signed only by Lessor (where such authorization is
permitted by law) at all places where Lessor deems necessary.
23. MISCELLANEOUS. (a) Lessee shall provide Lessor with such
corporate resolutions, financial statements and other documents as Lessor
shall reasonably request from time to time. (b) Lessee represents that the
Equipment is being leased hereunder for business purposes. (c) Time is of the
essence with respect to this Lease. (d) Lessee shall keep its books and
records in accordance with generally accepted accounting principles and
practices consistently applied and shall deliver to Lessor its annual audited
financial statements, unaudited monthly financial statements to include any
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financial information given to Lessee's Board of Directors, and signed by an
officer of Lessee and such other unaudited financial statements as may be
reasonably requested by Lessor.
24. NOTICES. All notices hereunder shall be in writing, by registered
mail, or reliable messenger or delivery service and shall be directed, as the
case may be, to Lessor at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: Account Management and to Lessee at ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇, copy to ▇▇▇
▇▇▇▇▇▇.
25. ENTIRE AGREEMENT. Lessee acknowledges that Lessee has read this
Lease, understands it and agrees to be bound by its terms, and further agrees
that it and each Schedule constitute the entire agreement between Lessor and
Lessee with respect to the subject matter hereof and supersedes all previous
agreements, promises, or representations. The terms and conditions hereof
shall prevail notwithstanding any variance with the terms of any purchase
order submitted by the Lessee with respect to any Equipment covered hereby.
26. AMENDMENT. This Lease may not be changed, altered or modified
except by an instrument in writing signed by an officer of the Lessor and the
Lessee.
27. WAIVER. Any failure of Lessor to require strict performance by
Lessee or any waiver by Lessor of any provision herein shall not be construed
as a consent or waiver of any other breach of the same or any other provision.
28. SEVERABILITY. If any provision of this Lease is held invalid, such
invalidity shall not affect any other provisions hereof.
29. JURISDICTION AND WAIVER OF JURY TRIAL. This Lease shall be
governed by and construed under the laws of the State of California. It is
agreed that exclusive jurisdiction and venue for any legal action between the
parties arising out of this Lease shall be in the Superior Court for Marin
County, California, or, in cases where Federal diversity jurisdiction is
available, in the United States District Court for the Northern District of
California. LESSEE, TO THE EXTENT IT MAY LAWFULLY DO SO, HEREBY WAIVES ITS
RIGHT TO TRIAL BY JURY IN ANY ACTION BROUGHT ON OR WITH RESPECT TO THIS
LEASE, ANY SCHEDULE, OR ANY AGREEMENT EXECUTED IN CONNECTION HEREWITH.
30. NATURE OF TRANSACTION. Lessor makes no representation whatsoever,
express or implied, concerning the legal character of the transaction
evidenced hereby, for tax or any other purpose.
31. SECURITY INTEREST. (a) One executed copy of the Lease will be
marked "Original" and all other counterparts will be duplicates. To the
extent, if any, that this Lease constitutes chattel paper (as such term is
defined in the Uniform Commercial Code as in effect in any applicable
jurisdiction) no security interest in the lease may be created in any
documents other than the "Original." (b) There shall be only one original of
each Schedule and it shall be marked "Original," and all other counterparts
will be duplicates. To the extent, if any, that any Schedule(s) to this Lease
constitutes chattel paper (or as such term is defined in the Uniform
Commercial Code as in effect in any applicable jurisdiction) no security
interest in any Schedule(s) may be created in any documents other than the
"Original."
32. SUSPENSION OF OBLIGATIONS. The obligations of Lessor hereunder will
be suspended to the extent that it is hindered or prevented from complying
therewith because
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of labor disturbances, including but not limited to strikes and lockouts, acts
of God, fires, storms, accidents, failure of the manufacturer to deliver
any item of Equipment, governmental regulations or interference, or any cause
whatsoever not within the sole and exclusive control of Lessor.
33. SOFTWARE. For the term of this Lease, and so long as no Event
of Default has occurred and is continuing, Lessor hereby assigns to Lessee
all of Lessor's rights under any License Agreement executed by Lessor in
connection with the Equipment (except for any right of Lessor to be
reimbursed for the License Fee). Lessee agrees to be bound by the provisions
of any such License Agreement and to perform all obligations of Lessor
(except Lessor's payment obligations) thereunder. Lessee acknowledges that
all of Lessee's obligations under the Lease with respect to the Equipment
will apply equally to the software, including but not limited to Lessee's
obligation to pay rent to Lessor.
34. COMMITMENT FEE. Lessee has paid to Lessor a commitment fee
("Fee") of $15,000. The Fee shall be applied by Lessor first to reimburse
Lessor for all out-of-pocket UCC search costs, inspections and appraisal fees
incurred by Lessor, and then proportionally to the first month's rent for
each Schedule hereunder in the proportion that the purchase price of the
Equipment leased pursuant to the Schedule bears to Lessor's entire
commitment. However, the portion of the Fee which is not applied to rental
shall be non-refundable except if Lessor defaults in its obligations pursuant
to Section 3.
35. FINANCE LEASE. The parties agree that this lease is a "Finance
Lease" as defined by Section 10-103(a)(7) of the California Commercial Code
(Cal.Com.C.). Lessee acknowledges either (a) that Lessee has reviewed and
approved any written Supply Contract (as defined by Cal.Com.C. Section
10-103(a)(25)) covering Equipment purchased from the "Supplier" (as defined
by Cal.Com.C. Section 10-103(a)(24)) thereof for lease to Lessee or (b) that
Lessor has informed or advised Lessee, in writing, either previously or by
this Lease of the following: (i) the identity of the Supplier; (ii) that the
Lessee may have rights under the Supply Contract; and (iii) that the Lessee
may contact the Supplier for a description of any such rights Lessee may have
under the Supply Contract. Lessee hereby waives any rights and remedies
Lessee may have under Cal.Com.C. Sections 10-508 through 522.
36. END OF LEASE POSITION. At the expiration of the Initial Term
of each Schedule to the Lease, Lessee shall choose a final purchase or
renewal option or requirement ("End of Lease Position") as specified in such
Schedule, and that choice shall be an election of Lessee's End Position for
all, but not less than all, of the Equipment under such Schedule to the Lease.
Any Equipment Purchase election shall be a purchase of the Equipment, AS-IS,
WHERE-IS. Upon Lessor's receipt of the purchase price, Lessor shall issue to
Lessee an equipment ▇▇▇▇ of sale, transferring the Equipment's title to the
Lessee without any representation or warranty whatsoever. Lessee shall be
responsible for all applicable taxes in connection with any Equipment
purchase.
-9-
Fair market or rental value shall be determined for the Equipment under all
Schedules prior to the Initial Term's expiration.
Lessee shall be responsible for all applicable taxes in connection with any
purchase of Equipment by Lessee.
IN WITNESS WHEREOF, the parties hereto have executed this Lease.
PHOENIX LEASING INCORPORATED NEWGEN RESULTS CORPORATION
By: By: /s/ ▇▇▇ ▇▇▇▇▇▇
----------------------------- -----------------------------
Title: V.P. Title: CFO
--------------------------- --------------------------
Headquarters Location:
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
--------------------------------
City, State Zip Code
San Diego
--------------------------------
County
Exhibit A - Closing Memorandum
-10-
Exhibit A
to MASTER EQUIPMENT LEASE
Dated December 15, 1996
CLOSING MEMORANDUM
------------------
1.* Duly executed Master Equipment Lease marked "Original."
2. Duly executed Schedule marked "Original."
3. Duly executed Certificate of Acceptance.
[EXECUTE UPON ACCEPTANCE OF EQUIPMENT]
4. Insurance Certificates.
5.* Resolutions of Lessee's Board of Directors, including an incumbency
certificate.
6.* Copy of Lessee's articles of incorporation including all amendments,
certified by the Secretary of Lessee as being true and complete and in
full force and effect.
7.* Certificate from the Secretary of State of Lessee's state of
incorporation, from the state in which Lessee's chief executive office
is located, if different, and from each state where Lessee is qualified
to do business, stating Lessee is in good standing or is authorized to
transact business, as the case may be, dated not more than thirty days
prior to the first purchase of Equipment.
8. Real Property Waiver.**
9. UCC Financing Statements.
10. ▇▇▇▇ of Sale (for Sale-Leaseback Equipment).
11. UCC search.
12. Equipment List, in form and substance satisfactory to Lessor.
13. Lessee's most recent financial statements.
14. Certificate of Chief Financial Officer stating that no event of default
has occurred, there is no adverse change in the financial condition of
Lessee and that the Equipment is free of any encumbrances.
15. See Section 3 of Master Equipment Lease for additional preconditions to
closing.
* First Schedule Only.
** Required if any Equipment is a fixture, i.e., attached to real
property, or located in certain states.
SCHEDULE
--------
Schedule No. 1 to Lease
Dated as of December 15, 1996
between NEWGEN RESULTS CORPORATION
and PHOENIX LEASING INCORPORATED
A. DESCRIPTION AND PURCHASE PRICE OF EQUIPMENT
Description of
Equipment
(quantity, model Purchase Mfr./ (Street Address
and serial number) Price Rent Vendor City, State and County)
------------------ --------- ------ ------ -----------------------
See Exhibit A attached hereto. ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Total: $324,438.58 $10,382.03
B. TERMS
Initial Term: The Initial Term shall commence on the date the Equipment
is received, installed and accepted for use, as shown on
the Acceptance Notice, and continue for 36 full months
after the "Rent Start Date."
Rent Start Date: This shall be the first day of the month following the
month during which the Initial Term commences; provided,
however, that if the Equipment is accepted on the first
day of the month, the Rent Start Date shall commence on
the same day that the Initial Term commences.
Lease Rate Factor (expressed as a percentage of Equipment's original Purchase
Price): 3.20%.
Monthly Rental Payments in advance.
Initial Rent Due: Payable on the Rent Start Date shall be (1) the Rental
Amount including any sales or use tax, (2) an amount
equal to 1/30th of the monthly rental amount multiplied
by the number of days, if any, between (and including)
the date the Initial Term commences and (but not including)
the Rent Start Date, and (3) last month's rent.
C. INVOICE INFORMATION: Lessee's and Lessor's addresses for invoice
purposes for the Equipment on the Schedule shall be as follows:
Lessee's Invoice Address: Remit Monthly Rental Amount To:
Newgen Results Corporation Phoenix Leasing Incorporated
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇. ▇▇▇ P.O. Box 200432
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
-1-
Schedule No. 1 to Lease
Dated as of December 15, 1996
Between NEWGEN RESULTS CORPORATION
and PHOENIX LEASING INCORPORATED
D. CASUALTY VALUES: See attachment hereto.
E. SPECIAL PROVISIONS: 1. Lessor's payment for Equipment hereunder is
conditioned on Lessor's satisfaction that there has been no adverse change in
Lessee's financial condition subsequent to initial credit approval, 2. Sale
Leaseback Addendum, and 3. End of Lease Position Requirement Rider.
LESSOR AND LESSEE AGREE THAT THIS SCHEDULE SHALL CONSTITUTE A LEASE OF THE
EQUIPMENT DESCRIBED ABOVE, SUBJECT TO THE TERMS AND CONDITIONS OF THIS
SCHEDULE AND OF THE MASTER EQUIPMENT LEASE DATED DECEMBER 15, 1996 BETWEEN
LESSEE AND LESSOR. THE TERMS AND CONDITIONS OF SUCH MASTER EQUIPMENT LEASE
ARE HEREBY INCORPORATED BY REFERENCE AND MADE A PART HEREOF TO THE SAME EXTENT
AS IF SUCH TERMS AND CONDITIONS WERE SET FORTH IN FULL HEREIN.
PHOENIX LEASING INCORPORATED NEWGEN RESULTS CORPORATION
By: By: /s/ ▇▇▇ ▇▇▇▇▇▇
-------------------------- ---------------------------
Title: Title: C.F.O., V.P.
----------------------- ------------------------
Date: Date: Feb. 20/97
----------------------- ------------------------
-2-
PHOENIX LEASING INCORPORATED
FUNDING REQUEST
Lessee: Newgen Results Corporation
-------------------------------------
Location Address: ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇. ▇▇▇
-------------------------------------
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
-------------------------------------
Master Contract: 0053 Schedule: 01
------------------------------------- --------
No entry required
------------------
Net Net
L Invoiced Amt Tax Pd $ Amt. $ Amt.
Vendor Name Invoice Brief Description Eqp. Serial 0 Net of Amt Paid Vendor? Check Transact Due Due
(abbreviation OK) No. of Item Cod Number 0 Sales Tax By Lessee (Y/N) No. Date Lessee Vendor
-----------------------------------------------------------------------------------------------------------------------------------
Corporate Express I 405 224/Ppr.Mgr. Doc Tray 6 1 3,725.57 3,725.57 y 6592 1/15/97 $3,725.57 $0.00
56/Binder File Caddy 6 1 556.25 556.25 y 6592 1/15/97 $556.25 $0.00
75/Adj. Keyboard Arm 6 1 8,645.18 8,645.18 y 6592 1/15/97 $8,645.18 $0.00
Keyboard Clamp Spr Ast. 6 1 1,729.04 1,729.04 y 6592 1/15/97 $1,729.04 $0.00
Low shelf 60w 6 1 53.82 53.82 y 6592 1/15/97 $53.82 $0.00
48 Task Lights 10 1 2,160.32 2,160.32 y 6592 1/15/97 $2,160.32 $0.00
Work Areas(desks,shelf) 6 1 162,144.60 162,144.60 y 6592 1/15/97 $162,144.60 $0.00
6 1 y AmEx 1/15/97 $0.00 $0.00
6 1 y AmEx 1/15/97 $0.00 $0.00
6 1 y 7439 1/15/97 $0.00 $0.00
Drawer Files 6 1 10,828.82 10,828.82 y 7439 1/15/97 $10,828.82 $0.00
6 1 y 8419 1/15/97 $0.00 $0.00
Installation 26 1 15,250.00 15,250.00 y 8419 1/15/97 $15,250.00 $0.00
Sales Tax 27 1 16,324.83 16,324.83 y 8419 1/15/97 $16,324.83 $0.00
Price Adjustment 6 1 $0.00 $0.00
Hall-▇▇▇▇ Computer 53782080 K420 Server 1 3629A17679 1 33,804.00 33,804.00 n AmEx 9/18/96 $33,804.00 $0.00
1 24R189026 1 $0.00 $0.00
▇▇-▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ 1 A5612340696 1 25,920.00 25,920.00 n AmEx 9/18/96 $25,920.00 $0.00
1 A56102340767 1 $0.00 $0.00
1 A56102342099 1 $0.00 $0.00
128MB Hi-Den ECC Mem 1 A56401522787 1 6,444.00 6,444.00 n AmEx 9/18/96 $6,444.00 $0.00
32MB ECC Memory Mod 1 A56400429101 1 1,368.00 1,368.00 n AmEx 9/18/96 $1,368.00 $0.00
DDS DatDrive+4-16GB 1 GB00503344 1 1,941.00 1,941.00 n AmEx 9/18/96 $1,941.00 $0.00
Console 800 Series 1 UST3190934 1 389.00 389.00 n AmEx 9/18/96 $389.00 $0.00
4GB ▇ ▇▇▇▇ ▇▇▇▇▇ + Fld 1 K8182830 1 6,624.00 6,624.00 n AmEx 9/18/96 $6,624.00 $0.00
1 K8184807 1 $0.00 $0.00
1 K8186695 1 $0.00 $0.00
1 K8197049 1 $0.00 $0.00
9000HP-BP Centr Adapter 1 40SM9V975 1 789.00 789.00 n AmEx 9/18/96 $789.00 $0.00
Page 1 of 4
Phoenix Leasing Incorporated
Funding Request
Comp Racks & Cabinets 1 1 7,296.00 7,296.00 n AmEx 9/18/96 $7,296.00 $0.00
1.8KVA RackMt PwrTrust 1 D96GD00112 1 2,052.00 2,052.00 n AmEx 9/18/96 $2,052.00 $0.00
4GB 2 Disk in CC Rack 1 SG30003685 1 3,456.00 3,456.00 n AmEx 9/18/96 $3,456.00 $0.00
4GB 2 Disk in CC Upgrd 1 SG33014021 1 3,802.00 3,802.00 n AmEx 9/18/96 $3,802.00 $0.00
SG33014026 1 $0.00 $0.00
4GB DDS Data Drive 1 GB00492312 1 2,396.00 2,396.00 n AmEx 9/18/96 $2,396.00 $0.00
HP-UX 10 User License 25 1 375.00 375.00 n AmEx 9/18/96 $375.00 $0.00
Shipping Charge 27 1 312.15 312.15 n AmEx 9/18/96 $312.15 $0.00
P154204- First Year System Support 25 1 5,303.00 5,303.00 AmEx 9/18/96 $5,303.00 $0.00
2851 Media Updates 23 1 749.00 749.00 AmEx 9/18/96 $749.00 $0.00
TOTAL AMOUNT DUE TO LESSEE $324,438.58
TOTAL AMOUNT DUE TO VENDOR $0.00
TOTAL DRAW $324,438.58
Lessee Signature: Date: Feb. 20, 1997
------------------ -------------
Page 2 of 4
Attachment to Equipment Schedule No. 1
CASUALTY VALUES
Month of % of Original Equipment Month of % of Original Equipment
Lease Term Purchase Price Lease Term Purchase Price
------------ ----------------------- ----------- ------------------------
1 125.00 19 73.57
2 122.14 20 70.71
3 119.29 21 67.86
4 116.43 22 65.00
5 113.57 23 62.14
6 110.71 24 59.29
7 107.86 25 56.43
8 105.00 26 53.57
9 102.14 27 50.71
10 99.29 28 47.86
11 96.43 29 45.00
12 93.57 30 42.14
13 90.71 31 39.29
14 87.86 32 36.43
15 85.00 33 33.57
16 82.14 34 30.71
17 79.29 35 27.85
18 76.43 36 25.00
Thereafter 25.00
Lessor's Lessee's
Initials Initials
--------- --------
Rider No. 1
to Schedule No. 2
of MASTER EQUIPMENT LEASE
Dated December 15, 1996
Between NEWGEN RESULTS CORPORATION
and PHOENIX LEASING INCORPORATED
END OF LEASE POSITION REQUIREMENTS
Provided no Event of Default has occurred and is continuing and
notwithstanding anything to the contrary in the Lease, Lessee is required to
elect one of the following alternatives at the Schedule's Initial Term
expiration. Lessee shall make its election by giving Lessor at least 90 days'
written notice thereof prior to such expiration.
Alternative No. 1: Purchase the Equipment for 15% of the Equipment's
original purchase price.
Alternative No. 2: Extend the Schedule's Initial Term for an additional
12 months ("Renewal Term") at a monthly rate of 1.85%
of the Equipment's original purchase price. At the
expiration of the Renewal Term, Lessee shall purchase
the Equipment for $1.
In the event Lessee does not provide 90 days' prior written notice, Lessee
shall be deemed to have elected No. 1 above.
Lessor's Lessee's
Initials Initials
--------- ---------
Sale Leaseback Addendum
to Schedule No. 1
of MASTER EQUIPMENT LEASE
Dated December 15, 1996
Between NEWGEN RESULTS CORPORATION
and PHOENIX LEASING INCORPORATED
This Addendum to Master Equipment Lease is made and entered into as of Feb
20/97, between Phoenix Leasing Incorporated ("Lessor") and Newgen Results
Corporation ("Lessee").
Notwithstanding anything to the contrary contained in the Lease referenced
above, Lessor and Lessee agree as follows:
1. Lessee shall sell the Equipment to and lease the Equipment from Lessor
and Lessor shall purchase the Equipment from and lease the Equipment to
Lessee upon the terms and conditions of the ▇▇▇▇ of Sale attached hereto
as Attachment 1.
2. Lessee represents and warrants that:
(a) Lessee has the right to sell the Equipment as set forth herein,
(b) the Equipment and Lessee's right, title and interest in such
Equipment is, as of the date of the ▇▇▇▇ of Sale, free from all claims,
liens, security interests and encumbrances,
(c) Lessee will defend the sale against lawful claims and demands of
all persons, and
(d) the purchase price of the Equipment is equal to the fair market
value of such Equipment at the time of sale.
PHOENIX LEASING INCORPORATED NEWGEN RESULTS CORPORATION
By By /s/ ▇▇▇ ▇▇▇▇▇▇
-------------------------- ------------------------
Title Title V.P., C.F.O.
----------------------- --------------------
ATTACHMENT 1
▇▇▇▇ OF SALE
For valuable consideration Newgen Results Corporation ("Seller") sells to
Phoenix Leasing Incorporated ("Buyer"), the property listed on Exhibit A
hereof (the "Equipment").
Seller covenants and warrants that:
(1) It is the owner of, and has absolute title to, the Equipment which is
free and clear of all claims, liens and encumbrances.
(2) It has not made any prior sale, assignment, or transfer of the Equipment.
(3) It has the present right, power, and authority to sell the Equipment to
Buyer.
(4) All action has been taken which is required to make this ▇▇▇▇ of Sale a
legal, valid and binding obligation of Seller.
Seller shall forever warrant and defend the sale of Equipment to Buyer, its
successors and assigns, against any person claiming an interest in the
Equipment.
This ▇▇▇▇ of Sale is binding on the successors and assigns of Seller and
inures to the benefit of the successors and assigns of Buyer.
Executed on Feb. 20, 1997.
NEWGEN RESULTS CORPORATION
By: /s/ ▇▇▇ ▇▇▇▇▇▇
------------------------
Title: V.P., C.F.O.
---------------------
ACCEPTANCE NOTICE
SCHEDULE NO. 1
Reference is made to the Master Equipment Lease dated as of December 15, 1996
between Phoenix Leasing Incorporated as Lessor and Newgen Results Corporation
as Lessee (the "Lease").
Lessee confirms that the following Equipment has been received, installed and
is ready for use by Lessee. The Equipment is satisfactory in all respects for
the purposes of this Lease as of the date Lessee executes this Notice below.
Description of
Equipment
(quantity, model Purchase Mfr./ (Street Address
and serial number) Price Rent Vendor City, State and County)
------------------ -------- ---- ------ -----------------------
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
See Exhibit A attached hereto. ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Total: $324,438.58 $10,382.03
THE LEASE MAY NOT BE CHANGED, ALTERED OR MODIFIED EXCEPT BY AN INSTRUMENT IN
WRITING SIGNED BY AN OFFICER OF LESSOR AND A DULY AUTHORIZED REPRESENTATIVE
OF LESSEE.
IN WITNESS WHEREOF, Lessee has executed this Acceptance Notice as of
______________, 199__.
NEWGEN RESULTS CORPORATION
By: /s/ ▇▇▇ ▇▇▇▇▇▇
------------------------
Name: ▇▇▇ ▇▇▇▇▇▇
----------------------
Title: V.P., C.F.O.
---------------------
OFFICER'S CERTIFICATE
---------------------
The undersigned, ▇▇▇ ▇▇▇▇▇▇, hereby certifies that:
i) I am the Treasurer/Chief Financial Officer of NEWGEN RESULTS
CORPORATION, a California corporation;
ii) as such officer, I am familiar with the terms and conditions of that
certain Master Equipment Lease (the "Lease") dated as of December 15,
1996 between NEWGEN RESULTS CORPORATION ("Lessee") and PHOENIX LEASING
INCORPORATED ("Lessor);
iii) this certificate is delivered in connection with the leasing of certain
equipment under a Schedule with Lessor, the equipment is described in the
Schedule and the equipment is free and clear from any and all liens,
charges, security interests or other encumbrances which may affect
Lessor's right, title or interest in and to the equipment;
iv) there has been no material adverse change in the financial condition of
Lessee from the date of its most recent financial statements, true
copies of which have been delivered to Lessor; and
v) no event which, with the giving of notice or passage of time, or both,
could become an Event of Default under the Lease has occurred and is
continuing.
vi) Lessee is performing according to Lessee's business plan described in
Section 3 of the Lease, a true copy of which business plan has been
delivered to Lessor;
vii) the representations and warranties in Section 3 of the Lease are true
and correct as of the date hereof.
IN WITNESS WHEREOF, I hereby execute this certificate on this 20th day of
February, 1997.
/s/ ▇▇▇ ▇▇▇▇▇▇
-------------------------------
[LETTERHEAD OF PHOENIX GROWTH CAPITAL CORP.]
November 5, 1996
▇▇. ▇▇▇▇▇ ▇▇▇▇
Newgen Results Corporation
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇. ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear ▇▇▇▇▇:
We are pleased to submit this commitment for a NON-WARRANT equipment lease
line under the following terms and conditions.
FACILITY
--------
Finance Lease
PARTIES TO THE TRANSACTION
--------------------------
1. LESSEE: Newgen Results Corporation
2. LESSOR: Phoenix Growth Capital Corp. (PGCC), its Affiliates or Assigns.
EQUIPMENT
---------
1. TOTAL COST: Up to $1,500,000
2. EQUIPMENT DESCRIPTION: High-end computers, furniture. Up to 20% of the
utilized line may be comprised of soft costs consisting of items
listed as exclusions below.
a. EXCLUSIONS: Custom use equipment, installation and delivery costs,
purchase tax, tooling, software, and items generally considered
fungible or expendable.
b. USED EQUIPMENT: Lessor will provide lease financing for acceptable
used equipment. Equipment purchased by Lessee prior to 90 days
before completion of lease documentation is subject to adequate
depreciation allowances.
3. DELIVERIES: All equipment to be purchased by Lessor must be delivered,
accepted and funded no later than December 31, 1997.
4. EQUIPMENT LOCATION: Same as above.
▇▇. ▇▇▇▇▇ ▇▇▇▇
November 5, 1996
Page 2
TRANSACTION STRUCTURE
---------------------
The Lessor will purchase the equipment from the Lessee or the vendor
(after delivery) and simultaneously lease the equipment to the Lessee.
A finance lease document will evidence the agreement between the Lessor
and Lessee. It is anticipated that the lease will be a Master Lease with
schedules evidencing takedowns. All base Master Lease documentation must
be completed within four weeks of the date a commitment letter has been
signed by both parties.
LEASE INFORMATION
-----------------
1. BASE LEASE TERM COMMENCEMENT DATE: The Base Lease Term will commence on
the first of the month. If funding is other than the first of the
month, commencement date will be the first of the following month.
2. BASE LEASE TERM(S): The Base Lease Term will be 36 months from the
Base Lease Term Commencement Date.
3. DELIVERY AND ACCEPTANCE: All equipment delivered and placed in service
will be acknowledged and accepted by the Lessee per a written
Acceptance Notice.
4. FINANCIAL CLOSING DATE(S): The equipment will be paid for by the
Lessor on a monthly basis in aggregate amounts not less than $25,000.
5. INTERIM RENT: An interim Lease term will run from the date each
equipment schedule is funded by the Lessor until the Base Lease Term
Commencement Date.
6. LEASE RATE FACTOR: 36 months at 3.20%, last payable in advance.
7. END OF LEASE POSITION: At lease expiration, the Lessee will either (a)
purchase the equipment for not less than 10% nor more than 15% of
Total Cost or, (b) renew the Lease for an additional 12 months at
1.85% per month and then own the equipment for payment of $1.00.
8. CASUALTY VALUES (STIPULATED LOSS VALUES): In the event the equipment
is destroyed or otherwise rendered permanently unfit for service, and
is not repaired or replaced by Lessee or its insurance carrier, the
Lessee will pay a Casualty Value. The Casualty Values will be
calculated at the outset of the transaction and will dictate the
amount of the Lessee's casualty insurance coverage.
▇▇. ▇▇▇▇▇ ▇▇▇▇
November 5, 1996
Page 3
OTHER CONSIDERATIONS
--------------------
1. NET LEASE: The lease will be net to the Lessor. Lessee will be
responsible for all expenses in connection with the equipment,
including taxes (except taxes based on the income of the Lessor),
franchise taxes, charges in lieu of taxes, assessments, insurance
premiums, all costs of operations, repair, maintenance and rebuilding,
and all of the charges related to the equipment or its operation.
2. TRANSACTION EXPENSE: Each party shall bear its own expenses, including
fees and expenses of counsel and accountants, incurred in connection
with the documentation and preparation of this lease transaction,
except UCC, equipment identification and appraisal costs, which will
be borne by Lessee. However, if this transaction is not funded because
Lessee (a) fails to execute final documents with Lessor, (b) chooses
not to use the committed lease amounts, or (c) sustains a material
adverse change in its financial condition, Lessor shall retain the
commitment fee as compensation for expenses.
3. STOCK WARRANTS: None.
4. ADDITIONAL COLLATERAL: None.
5. COMMITMENT FEE: Lessee has paid to Lessor a commitment fee of $15,000.
The fee shall be applied by Lessor first to reimburse any Transaction
Expenses shown above and then proportionally to the first payment due
for each schedule hereunder.
6. FINANCIAL INFORMATION: Lessee must provide interim financial
information (balance sheet, income statement, funds flow and changes
to projections) when available monthly after a commitment letter has
been signed by both parties.
7. CONDITIONS PRECEDENT: No material adverse performance to plan.
If you are in agreement with the foregoing, please sign and date one copy of
this committment letter and return it to my attention by FAX at ▇▇▇-▇▇▇-▇▇▇▇.
Sincerely, Acknowledge and Agreed To:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By:
------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President Its:
-----------------------------------
Date:
----------------------------------
[LETTERHEAD OF PHOENIX GROWTH CAPITAL CORP.]
July 1, 1998
▇▇. ▇▇▇▇▇ ▇▇▇▇
Newgen Results Corporation
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇. ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear ▇▇▇▇▇:
We are pleased to submit this proposal for an extension of your equipment
lease line under the following terms and conditions.
FACILITY
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Finance Lease
PARTIES TO THE TRANSACTION
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1. LESSEE: Newgen Results Corporation
2. LESSOR: Phoenix Growth Capital Corp. (PGCC), its Affiliates or Assigns.
EQUIPMENT
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1. TOTAL COST: Up to $1,000,000 additional for a total of $2,500,000
2. EQUIPMENT DESCRIPTION: High-end computers, furniture. Up to 20% of the
utilized line may be comprised of soft costs consisting of items
listed as exclusions below.
a. EXCLUSIONS: Custom use equipment, installation and delivery costs,
purchase tax, tooling, software, and items generally considered
fungible or expendable.
b. USED EQUIPMENT: Lessor will provide lease financing for acceptable
used equipment. Equipment purchased by Lessee prior to 90 days
before completion of lease documentation is subject to adequate
depreciation allowances.
3. DELIVERIES: All equipment to be purchased by Lessor must be delivered,
accepted and funded no later than July 31, 1999.
4. EQUIPMENT LOCATION: Same as above.
