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Exhibit 10(n)
MASTER LEASE PURCHASE AGREEMENT
THIS AGREEMENT is entered into the 21st day of November, 1995
between METLIFE CAPITAL CORPORATION ("Lessor") whose address is 00000 X.X. 0xx
Xxxxxx, mailing address C-97550, Xxxxxxxx, Xxxxxxxxxx 00000 and AMSCAN INC., a
New York Subchapter "S" corporation ("Co-Lessee"), DECO PAPER PRODUCTS, INC., a
Kentucky corporation ("Co-Lessee"), KOOKABURRA USA, LTD., a New York corporation
("Co-Lessee") and TRISAR, INC., a California corporation ("Co-Lessee")
("Lessee") whose address is (addresses as per the attached).
Lessor and Lessee from time to time may enter into written
agreements in the form of "Lease Purchase Addenda" for the leasing of equipment
by Lessor to Lessee. To facilitate such transactions, Lessor and Lessee are
entering into this Master Lease Purchase Agreement (the "Master Lease"), the
terms and provisions of which shall be incorporated by reference in each such
Lease Purchase Addendum, and they MUTUALLY AGREE AS FOLLOWS:
1. Lease Purchase Addendum
If Lessor agrees to lease equipment when requested by Lessee,
the parties shall sign a Lease Purchase Addendum ("Addendum") setting forth the
particulars regarding the transaction, including, without limitation, the list
of Items of equipment (individually, an "Item" and, collectively, the
"Equipment"), the prices of each Item (including disclosure of all rebates,
discounts and other incentives received or receivable with respect thereto).
"Related Costs," including taxes, transportation, installation and other
applicable costs, the aggregate of the foregoing ("Total Cost"), length of the
Basic Term, rental rates, purchase and renewal options, if any, and other
applicable provisions. "Cost of an Item" shall mean the price of the Item plus
its applicable portion of Related Costs. In the absence of a signed Addendum,
this Master Lease shall not constitute a lease or a commitment by either party
to enter into a lease.
2. Request to Lease; Equipment Acceptance
(a) REQUEST; SPECIFICATIONS. Signing an Addendum shall
constitute the request from Lessee to Lessor to lease the Equipment, and the
Addendum and this Master Lease shall constitute the lease and agreement (the
"Lease") regarding the Equipment. As security for all obligations of Lessee to
Lessor now existing or hereafter arising under this Lease, Lessee grants Lessor
a security interest in all Equipment. At the time of signing the Addendum,
Lessee shall furnish Lessor detailed specifications ("Specifications") of the
Items, including descriptions, prices, delivery terms and instructions,
installation provisions and all other applicable specifications. Lessee assumes
full responsibility with respect to the selection of Items supplied for lease
and the specification thereof; the Lessor
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shall have no liability or responsibility with respect thereto regardless of
whether the Specifications prove inadequate for the intended purpose or use.
(b) INSPECTION; ACCEPTANCE. It is Lessee's responsibility to
receive and promptly inspect and test each Item tendered for delivery by a
supplier and the installation thereof. Lessee shall give Lessor written notice
of acceptance of an Item as soon as it can be determined that the Item and its
installation are in compliance with Specifications. As between Lessee and
Lessor, the giving of such written notice shall constitute Lessee's irrevocable
acceptance of the Item or Items designated in the notice, whether or not such
Items or their installation are defective in any respect, and notwithstanding
any failure of an Item or its installation to conform to Specifications, without
prejudice however to rights which Lessor and Lessee, or either of them, may have
against any other person, whether with respect to design, manufacture, condition
or otherwise.
(c) PURCHASE CUT-OFF DATE. If, by the "Purchase Cut-Off Date"
set forth in an Addendum, Lessee shall not have given Lessor written notice of
acceptance of an Item, Lessor shall have no obligation to lease the Item to
Lessee. In such event, Lessee shall immediately pay all accrued Interim Rental
and reimburse Lessor for all sums Lessor may have paid for with respect to the
Item and for all Lessor's costs and expenses with respect thereto, and Lessee
shall indemnify and defend Lessor against and hold Lessor harmless from any and
all cost, expense, loss, liability and damage that Lessor may suffer or that may
be asserted against Lessor by reason of Lessor's failure or refusal to lease
such Item. Any such Item shall be deemed to be deleted from the Addendum and no
longer included in the Equipment.
(d) CONDITIONS PRECEDENT. Lessee shall deliver to Lessor such
further instruments, documents and certifications as Lessor reasonably may
request, including, without limitation evidences of authority (e.g., corporate
certificates, corporate resolutions, partnership documents and authorizations),
evidence of insurance, purchase orders and acceptances thereof, purchase and
sale agreements and financial information, and instruments and documents to
implement, perfect or continue the perfection of Lessor's rights and remedies as
Lessor of the Equipment, including Uniform Commercial Code forms. Lessee's
delivery of the foregoing and of the Specifications are conditions precedent to
any obligation of Lessor to make any commitments to pay for the Equipment or any
Item.
(e) SUPPLEMENTAL LEASE REQUEST. If at any time prior to the
Closing Date Lessee requests Lessor to add further Items to the Equipment, and
if Lessor so agrees, Lessee shall execute a Lease Purchase Addendum Supplement
in a form supplied by Lessor, which shall become part of the Addendum, subject
to all of its provisions and the provisions of this Master Lease, and the
Equipment specified therein shall be Items of Equipment under the Lease.
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(f) CLOSING. Following the date ("Closing Date") which is the
earlier of (i) the date Lessee gives Lessor written notice of acceptance of the
last Item or (ii) the Purchase Cut-Off Date (or on such other day as is mutually
agreed), Lessor shall send Lessee a Closing Schedule ("Schedule"), setting forth
any adjustments to descriptions and Costs of Items and Total Cost and confirming
the Closing Date, amount of Periodic Rental installments, payment schedules, and
insurance requirements. Lessee's signature on any such Schedule shall signify
the Lessee's agreement that the Schedule is correct. Notwithstanding any
discrepancies or disagreements between Lessor and Lessee regarding the
Schedules, Lessee shall pay all rentals as they become due in accordance with
the terms and conditions of the Lease. If Lessee establishes an error that
affects the amount of rentals, Lessor shall give Lessee a credit for any
overpayment of rentals, and Lessee promptly shall pay Lessor any underpayments.
The Schedules are incorporated herein by reference.
3. Lessee's Warranties
(a) Lessee represents and warrants to Lessor that it is a
corporation or partnership duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization and that it is qualified
to do business in every jurisdiction where the failure to qualify would have a
materially adverse effect on Lessor's rights hereunder, it has taken all
corporate or partnership action which may be required to authorize the
execution, delivery and performance of this Lease, and such execution, delivery
and performance will not conflict with or violate any provision of its Charter
or Articles or Certificate of Incorporation, By-laws or any provisions thereof,
or in the case of a partnership, its Certificate of Partnership or Limited
Partnership and its Partnership Agreement, or result in a default or
acceleration of any obligation under any agreement, order, decree or judgment to
which it is a party or by which it is bound, nor is it now in default under any
of the same; there is no litigation or proceeding pending or threatened against
it which may have a materially adverse effect on Lessee or which would prevent
or hinder the performance by it of its obligations hereunder; this Lease and the
attendant documents constitute valid obligations of the Lessee, binding and
enforceable against it in accordance with their respective terms; no action by
or with any commission or administrative agency is required in connection
herewith; it has the power to own its assets and to transact business in which
it is engaged; it will give to Lessor prompt notice of any change in its name,
identity or structure.
(b) Lessee's written acceptance of an Item and its
installation shall constitute a REPRESENTATION AND WARRANTY BY Lessee to Lessor
that (i) the Item is personal property in good order and condition; (ii) the
Item conforms to Specifications; (iii) unless otherwise specified, the Item has
not been used prior to its acceptance by Lessee; and (iv) at all times Lessee
shall keep the Equipment in Lessee's
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possession at the address specified in the Addendum unless Lessor shall
otherwise consent in writing. Lessee shall not cause, suffer or permit any Item
to be attached or affixed to real property or improvements thereon
(collectively, "Realty") unless Lessor first shall consent thereto in writing
and Lessee shall have obtained from all persons having any interest in the
Realty written consents which approve such attachment, waive any claims to or
encumbrances upon attached Items and consent to the detachment and removal of
such Items at any time by Lessor or Lessee. Notwithstanding attachment of any
Items to Realty, all the Equipment at all times shall be and remain personal
property. Upon termination of Lessee's right to possession of the Equipment,
whether by expiration of the Term or otherwise, Lessee at its sole cost and
expense shall detach and remove the Equipment from the Realty and save Lessor
harmless from and indemnify and defend Lessor against any claim, demand, loss,
liability and damage arising from such detachment, removal or both.
4. Term Of Lease
The Term of the Lease ("Term") may consist of an "Interim
Term" and a "Basic Term." The Interim Term shall begin on the date that Lessee
first gives Lessor written notice of acceptance of an Item or written approval
for partial payment, whichever is earlier, and shall continue until the time the
Basic Term begins. The Basic Term shall begin on the Closing Date and shall
continue for the length of the Basic Term set forth in the Addendum.
5. Interim Rental
During the Interim Term, if any, Lessee shall pay rent monthly
("Interim Rental"), on a calendar month basis, in an amount determined by Lessor
by applying the "Interim Rental Rate" set forth in the Addendum to portions of
the Total Cost then or theretofore expended by Lessor, for the number of days
such sums are outstanding during such calendar month. The "prime rate" referred
to in this Lease shall mean the rate per annum publicly announced by Chase
Manhattan Bank, New York City, from time to time as its prime rate, whether or
not such rate is applied by said bank to any then outstanding loans, changing
with each annual change of such prime rate, Lessee shall pay Lessor each
installment of Interim Rental on the fifteenth day after the end of such
calendar month.
6. Periodic Rental
Lessee shall pay rent ("Periodic Rental") for the Basic Term
in an amount calculated by multiplying the Total Cost by the Periodic Rental
Rate set forth in the Addendum multiplied by the number of months constituting
the length of the Basic Term. Lessee shall pay installments of Periodic Rental
to Lessor in accordance with the payment schedule set forth in the Addendum.
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7. Late Payment
If any installment of rent or other sum owing under the Lease
shall not be paid when due and shall remain unpaid for ten (10) days, Lessee
shall pay Lessor a late charge equal to five percent (5%) of the amount
delinquent, but in no event at a rate greater than limited by any applicable
law. Such late charge is in addition to and not in lieu of other rights and
remedies Lessor may have.
8. Insurance
Lessee shall procure and continuously maintain and pay for (a)
all risk insurance against loss or damage to the Equipment for not less than the
full replacement value thereof naming Lessor as Loss Payee and (b) combined
single limit liability insurance, insuring Lessor and Lessee, all in such
amounts and against such risks and hazards as are set forth in the Addendum,
with insurance companies and pursuant to contracts or policies satisfactory to
Lessor. All contracts and policies shall include provisions for the protection
of Lessor notwithstanding any act or neglect of or breach or default by Lessee,
shall provide that proceeds of all insurance shall be payable first to Lessor to
the extent of its liability or interest as the case may be, shall provide that
they may not be modified, terminated or canceled unless Lessor is given at least
thirty (30) days' advance written notice thereof, and shall provide that the
coverage is "primary coverage" for the protection of Lessee and Lessor
notwithstanding any other coverage carried by Lessee or Lessor protecting
against similar risks. Lessee shall promptly notify any appropriate insurer and
Lessor of each and every occurrence which may become the basis of a claim or
cause of action against the insureds and provide Lessor with all data pertinent
to such occurrence. Lessee shall furnish Lessor with certificates of such
insurance or copies of policies upon request, and shall furnish Lessor with
renewal certificates not less than ten (10) days prior to the renewal date.
9. Taxes
Lessee shall pay all taxes, fees, assessments and other
governmental charges of whatsoever kind or character and by whomsoever payable
on or relating to any Item of Equipment or the sale, purchase, ownership, use,
value, value added, possession, shipment, transportation, delivery or operation
thereof or the exercise of any option, election or performance of any obligation
by Lessee hereunder, which may accrue or be levied, assessed or imposed during
the Term and any Renewal Term or which remain unpaid as of the date of surrender
of such Item to Lessor, and all taxes of any kind imposed by any federal, state,
local or foreign taxing authority against Lessor on or measured by any amount
payable by Lessee hereunder, including, without limitation, all license and
registration fees and all sales, use, value, ad valorem, personal property,
excise, gross receipts, stamp or other taxes, imposts, duties and charges
together with any penalties,
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fines, or interest thereon, except taxes of Lessor on net income imposed by the
United States or any state. Lessee shall reimburse Lessor for any payments made
by Lessor which are the obligation of Lessee under the Lease, but Lessee shall
not be obligated to pay any amount under this Section so long as it shall in
good faith and by appropriate proceeding contest the validity or the amount
thereof, unless such contest would adversely affect Lessor's interest in any
Item of Equipment or would subject any Item to forfeiture or sale. Lessee shall
indemnify Lessor on an after-tax basis against any loss, claim, demand and
expense, including legal expense, resulting from such nonpayment or contest and
further agrees to indemnify Lessor against any and all taxes, assessments and
other charges imposed upon Lessor under the laws of any federal, state, local or
foreign government or taxing authority, as a result of any payment made by
Lessee pursuant to this Section. Whenever this Lease terminates as to any Item,
Lessee will on request advance to Lessor the amount estimated by Lessor to equal
personal property taxes on the Item which are not yet payable but for which
Lessee will afterward become liable hereunder; Lessor will account to Lessee for
such advances. On request of either Lessor or Lessee, the other will submit
written evidence of all payments required of it under this Section.
10. Maintenance, Etc.
(a) Lessee at its expense at all times shall: (i) keep the
Equipment in good and efficient working order, condition and repair, ordinary
wear and tear excepted, and make all inspections and repairs, including
replacement of worn parts, to effect the foregoing and to comply with
requirements of laws, regulations, rules and provisions and conditions of
insurance policies; and (ii) pay all costs, expenses, fees and charges incurred
in connection with the use or operation of the Equipment and of each Item,
including but not limited to repairs, maintenance, storage and servicing. Lessee
shall not make any alterations, substitutions, improvements or additions to the
Equipment or Items, except those required in order to comply with laws,
regulations, rules and insurance policies, unless Lessor first shall have
consented thereto in writing. Notwithstanding any consent by Lessor, Lessee
shall pay all costs and expenses of the foregoing. All replacements, repairs,
improvements, alterations, substitutions and additions shall constitute
accessions to the Equipment and shall be subject to Lessor's security interest.
(b) Lessor hereby transfers and assigns to Lessee, for so long
during the Term and any Renewal Term as Lessee is not in default, Lessor's
right, title and interest in, under and to any assignable factory and dealer
warranty, whether express or implied, with respect to the Equipment. All claims
and actions upon any warranty shall be made and prosecuted by Lessee at its sole
cost and expense. Lessor shall have no obligation to make or prosecute any claim
upon or under a warranty. So long as Lessee shall not be in default, Lessor
shall cooperate with Lessee with respect to a claim on a non-assignable
warranty, at Lessee's expense. Lessee shall have proceeds of a warranty claim or
recovery paid to Lessor. Lessor shall make such proceeds available for any
repair, restoration or
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replacement to correct such warranted condition. Excess proceeds shall be used
to reduce Lessee's Lease obligations.
11. Use
So long as Lessee shall not be in default, Lessee shall be
entitled to the possession, use and quiet enjoyment of the Equipment during the
Term and any Renewal Term in accordance with the terms of the Lease. Lessee
warrants that the Equipment will at all times be used and operated solely in the
conduct of Lessee's business for the purpose for which it was designed and
intended and under and in compliance with applicable laws and all lawful acts,
rules, regulations and orders of any governmental bodies or officers having
power to regulate or supervise the use of such property, except that Lessee may
in good faith and by appropriate proceedings contest the application of any such
rule, regulation or order in any reasonable manner that will not adversely
affect the interest of Lessor in any Equipment or subject the same to forfeiture
or sale. Lessee will not permit its rights or interest hereunder to be subject
to any lien, charge or encumbrance and will keep the Equipment free and clear of
any and all liens, charges, encumbrances and adverse claims (except those
arising from acts of Lessor).
12. Net Lease; Loss And Damage
(a) This is a net lease. Lessee assumes all risk of and shall
indemnify Lessor against all damage to and loss of the Equipment from any cause
whatsoever, whether or not such loss or damage is or could have been covered by
insurance. Except as otherwise specifically provided herein, the Lease shall not
terminate and there shall be no abatement, reduction, suspension or deferment of
Interim or Periodic Rental for any reason, including damage to or loss of the
Equipment or any one or more Items. Lessee promptly shall give Lessor written
notice of any material loss or damage, describing completely and in detail the
cause and the extent of loss and damage. At its option, Lessee shall: (i) repair
or restore the damaged or lost Items to good condition and working order; or
(ii) replace the damaged or lost Items with similar equipment in good condition
and working order; or (iii) pay Lessor in cash the Stipulated Loss Value of the
damaged or lost Items. Upon Lessee's complying with the foregoing, Lessor shall
pay or cause to be paid over to Lessee the net proceeds of insurance, if any,
with respect to such damage or loss. "Damage" and "loss" shall include damages
and losses of any kind whatsoever including, without limitation, physical damage
and partial or complete destruction, including intentionally caused damage and
destruction, and theft.
(b) If Lessee pays Lessor the Stipulated Loss Value for an
Item, then the Lease shall terminate with respect to that Item, that Item shall
no longer be deemed part of the Equipment and Lessee shall be entitled to retain
the Item. However, it is understood that Lessor makes no representation or
warranty with respect to the Item, and further that
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Lessor shall have no obligation to pay any tax with respect thereto. In the
event that Lessee pays Lessor the Stipulated Loss Value for an Item, no further
Interim Rental shall be payable with respect to the Item, and Periodic Rental
for the remainder of the Term shall be reduced by multiplying the Cost of that
Item by the Periodic Rental Rate by the number of months then remaining in the
Basic Term.
13. Stipulated Loss Value
The "Stipulated Loss Value" of an Item shall be a sum computed
by Lessor, which is equal to that portion of the Cost of that Item which remains
outstanding presuming that Periodic Rental payments received are first applied
to earned but unpaid interest at the rental rate as specified in the Addendum.
The Stipulated Loss Value for the Equipment shall not exceed the amount set
forth in the Closing Schedule for the Lease Year during which the loss occurs,
which amount shall be prorated monthly effective to the month in which payment
of the Stipulated Loss Value is received by Lessor. A "Lease Year" is a
twelve-month period beginning on the Closing Date or on any anniversary thereof.
14. Security Interest And Marking
(a) This Lease is one intended as security and for tax
purposes, both parties will treat this transaction as a secured loan by Lessor
to Lessee.
(b) If so requested by Lessor, Lessee will affix tags,
supplied by Lessor, reflecting Lessor's security interest in the Equipment.
15. Lessee's Indemnities
Lessee will defend, indemnify and hold harmless Lessor from
and against any claim, cause of action, damage, liability, cost or expense
(including but not limited to legal fees and costs) which may be asserted
against or incurred in any manner by or for the account of Lessor or Lessee: (i)
relating to the Equipment or any part thereof, including, without limitation,
the manufacture, construction, purchase, delivery, acceptance or rejection,
installation, ownership, sale, leasing, removal or return of the Equipment, or
as a result of the use, maintenance, repair, replacement, operation or the
condition thereof (whether defects are latent or discoverable); (ii) by reason
or as a result of any act or omission of Lessee for itself or as agent or
attorney-in-fact for Lessor hereunder; (iii) as a result of claims for patent,
trademark or copyright infringement; or (iv) as a result of product liability
claims or claims for strict liability.
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16. Lessor May Perform
if lessee at any time shall fail to pay to any person any sum
which Lessee is required by the Lease to pay or shall fail to do or perform any
other thing Lessee is required by the Lease to do or perform, Lessor at its
option may pay such sum or do or perform such thing, and Lessee shall reimburse
Lessor on demand for the amount of such payment and for the cost and expense
which may be incurred by Lessor for such acts or performance, together with
interest thereon at the Default Rate from the date of demand until paid.
17. Events Of Default And Remedies
(a) EVENTS OF DEFAULT. Each of the following shall constitute
an event of default: (i) failure to perform and comply with the provisions and
conditions of Section 8 hereof; or (ii) failure to pay on the date when due, any
sum, including installments of rental, owed by Lessee or any affiliate of Lessee
at any time to Lessor, (iii) failure to perform and comply with any other
provision or condition of the Lease within thirty (30) days after Lessor shall
have given Lessee written notice of default with respect thereto; or (iv) any
event of default occurs with respect to any obligations of Lessee to Lessor (or
to any affiliate of Lessor, including, without limitation, MetLife Capital,
Limited Partnership and Metropolitan Life Insurance Company and their respective
affiliates and/or subsidiaries) on or with respect to any transactions, debts,
undertakings or agreements other than the Lease; or (v) if any representation or
warranty made by Lessee herein or in any statement or certificate furnished by
Lessee in connection wit this Lease proves untrue in any material respect as of
the date of making thereof, and shall not be made good within thirty (30) days
after written notice thereof to Lessee, or Lessee becomes insolvent or is
generally not paying its debts as they become due or makes an assignment for
benefit of creditors; or (vi) proceedings are commenced by Lessee under the
Federal Bankruptcy Code or any similar Federal or State laws for the relief of
debtors are commenced against Lessee and are not dismissed within sixty (60)
days after such commencement, or a trustee or receiver is appointed for Lessee
or a major part of its property and is not discharged within thirty (30) days
after such appointment; or (vii) any item of Equipment is seized or levied on
under legal or governmental process against Lessee or against such item of
Equipment or for any reason Lessor deems itself insecure; (viii) the merger,
consolidation, reorganization, conversion to a Subchapter "S" status or
dissolution of a corporate or partnership Lessee which has a materially adverse
effect upon Lessor's position under the Lease.
(b) REMEDIES. The occurrence of an Event of Default shall
terminate any obligation of Lessor to lease Equipment or Items thereof to
Lessee. When an Event of Default has occurred and is continuing, Lessor at its
option may: (i) proceed by appropriate court action or actions, either at law or
in equity, to enforce performance by the
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Lessee of the applicable covenants of this Lease or to recover damages for the
breach thereof, and/or (ii) without notice or demand declare immediately due and
payable the entire Stipulated Loss Value of any and all Items of Equipment then
under lease plus any and all amounts which under the terms of the Lease may be
then due; and thereupon MetLife shall have an immediate right to pursue all
remedies provided by law, including, without limitation, the following: (a)
Lessee agrees to put Lessor in possession of the Equipment on demand; (b) Lessor
is authorized to enter any premises where Equipment is situated and take
possession thereof without notice or demand and without legal proceedings; (c)
at Lessor's request, Lessee will assemble the Equipment and make it available to
Lessor at a place designated by Lessor which is reasonably convenient to both
parties; (d) Lessee agrees that ten (10) days from the time notice is sent shall
be a reasonable period of notification of a sale or other disposition of the
Equipment; (e) Lessee agrees to pay on demand the amount of all expenses
reasonably incurred by Lessor in protecting or realizing on the Equipment; (f)
if Lessor disposes of the Equipment, Lessee agrees to pay any deficiency
remaining after application of the net proceeds to the amounts due hereunder.
If upon the occurrence of an Event of Default, Lessor brings
suit or otherwise incurs expenses for protection of Lessor's rights, Lessee will
pay Lessor its legal fees, in a reasonable amount, together with Lessor's
collection expenses and court costs. In addition, from and after an Event of
Default, Lessee shall be liable for interest on amounts due Lessor hereunder at
a rate per annum computed monthly which shall be five (5) percentage points
above the prime rate, but not greater than the maximum rate, if any, limited by
applicable law ("Default Rate"); provided, however, that Lessee shall not be
assessed a late charge during such period of time that the Default Rate is
accruing against Lessee as herein stated. The remedies herein provided in favor
of Lessor shall not be deemed to be exclusive but shall be concurrent and
cumulative and in addition to all other remedies available at law or equity. The
exercise or partial exercise of any remedy shall not restrict Lessor from
further exercise of that remedy or any other remedy.
16. Surrender
At any time that Lessee is required to deliver the Equipment
to Lessor, Lessee shall immediately cease using the Equipment and at Lessee's
expense shall redeliver and surrender the Equipment to Lessor in good order,
condition and repair, ordinary wear and tear excepted, securely crated and
safely packed, at a place to be designated by Lessor in the State where the
Equipment by the terms of the Addendum is required to be kept, and, if Lessor so
specifies, loaded FOB a common or contract carrier designated by Lessor.
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19. Holdover
If Lessee shall not immediately redeliver and surrender any
Item of Equipment to Lessor when required by the terms hereof, Lessee shall pay
Lessor, at such time or times as Lessor may demand, a sum equal to a one-month
installment of Periodic Rental for each calendar month or fraction of a month
during which such failure to redeliver and surrender continues.
20. Inspection; Reports
Lessor, its agents and employees shall have the right to enter
upon any premises where the Equipment or Items are then located to inspect and
examine the same during normal business hours and at any other times if Lessor
reasonably believes any Items or Lessor's rights are in jeopardy of damage or
loss. So long as Lessee is not in default, Lessor shall give Lessee not less
than twenty-four (24) hours notice of such inspection. Lessee shall immediately
give Lessor written notice of any damage to or loss of the Equipment or any
Items from any cause, including without limitation damage or loss caused by
accident, the elements, intentional acts and theft. Such notice shall provide
itemization of the affected Items and a detailed account of the event, including
names of any injured persons and a description of any damaged property arising
from any such event or from any use or operation of the Equipment or any Items,
and of any attempt to take, distrain, levy upon, seize or attach the Equipment
or any Items. All rights granted to Lessor herein are for the benefit of Lessor
and shall not be construed to impose any obligation on Lessor, whether or not
Lessor makes any inspections or receives any reports.
21. Financial And Other Data
During the Term and any Renewal Term, Lessee: (a) shall
furnish Lessor annual balance sheets and profit and loss statements of Lessee
and any guarantor of Lessee's obligations accompanied, at Lessor's request, by
the audit report of an independent certified public accountant acceptable to
Lessor, and (b) at Lessor's request, shall furnish Lessor all other financial
information and reports reasonably requested by Lessor at any time, including
quarterly or other interim balance sheets and profit and loss statements of
Lessee and any such guarantor. Lessee shall furnish such other information as
Lessor may reasonably request at any times concerning Lessee and its affairs.
22. Warranty Of Information
Lessee warrants that all information furnished and to be
furnished to Lessor is accurate and that all financial statements it has
furnished and hereafter may furnish Lessor, including operating statements and
statements of condition, are and will be prepared in accordance with generally
accepted accounting principles, consistently applied,
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and reasonably reflect and will reflect, as of their respective dates, results
of the operations and the financial condition of Lessee and of any other entity
they purport to cover.
23. Non-Waiver
Neither the acceptance by Lessor of any payment or any other
performance, nor any act or failure of Lessor to act or to exercise any rights,
remedies or options in any one or more instances shall constitute a waiver of
any such right, remedy or option or of any other then existing or thereafter
accruing right, remedy or option, or of any breach or default then existing or
thereafter occurring. No purported waiver by Lessor of any right, remedy,
option, breach or default shall be binding unless in writing and signed by an
officer of Lessor. A written waiver by Lessor of any right, remedy, option,
breach or default shall not constitute a waiver of any other then existing or
thereafter accruing right, remedy or option or of any other then existing or
thereafter occurring breach or default.
24. Notices; Payments
(a) A written notice may be given: (i) by delivering the same
to a corporate officer of the party to whom it is directed (the "Addressee"), or
to a general partner if the Addressee is a partnership, or to the owner if the
Addressee is a sole proprietorship; or (ii) by mailing the notice to the
Addressee by first class mail, registered or certified, with postage prepaid,
addressed to the Addressee at the address following its name in the opening
paragraph of this Master Lease or to such other address as Addressee may specify
by notice in writing given in accordance with this Section. A notice so mailed
shall be deemed given on the third business day following the date of mailing. A
"business day" shall be any day that is not a Saturday or Sunday or legal
holiday.
(b) The Lessee shall make all payments to Lessor at the place
where the notice is to be mailed to Lessor pursuant to subparagraph (a).
Payments are deemed paid when received by Lessor.
25. Assignment
(a) Lessee shall not assign the Lease or any rights in or to
the Equipment or Items. Any attempted assignment shall be of no effect, unless
Lessor first shall have consented thereto in writing. Lessor's consent to an
assignment in any one or more instances shall not impose any obligation upon
Lessor to consent to any other or further assignment. Lessor's consent to an
assignment shall not release Lessee from any obligations with respect to the
Lease unless expressly so stated in the written consent.
(b) All rights of Lessor hereunder may be assigned, pledged,
mortgaged, transferred or otherwise disposed of, either in whole or in part,
without notice to Lessee but
-12-
13
subject always to the rights of Lessee under this Lease. If Lessee is given
notice of any such assignment, Lessee shall acknowledge receipt thereof in
writing. In the event that Lessor assigns this Lease or the rent due or to
become due hereunder or any other interest herein, whether as security for any
of its indebtedness or otherwise, no breach or default by Lessor hereunder or
pursuant to any other agreement between Lessor and Lessee, should there be one,
shall excuse performance by Lessee of any provision hereof, it being understood
that in the event of such default or breach by Lessor that Lessee shall pursue
any rights on account thereof solely against Lessor. No such assignee shall be
obligated to perform any duty, covenant or condition requested to be performed
by Lessor under the terms of this Lease.
26. Survival
The representations, warranties, indemnities and agreements of
Lessee, and Lessee's obligations under any and all provisions of the Lease,
shall survive the expiration or other termination of the Lease, shall be binding
upon its successors and assigns and are expressly made for the benefit of and
shall be enforceable by Lessor and its successors and assigns.
27. Miscellaneous
(a) The term "Lessor" shall mean the Lessor named herein and
its successors and assigns.
(b) Whenever the context so requires, any pronoun gender
includes all other genders, and the singular includes the plural. If more than
one person constitute Lessee, whether as a partnership or otherwise, all such
persons are and shall be jointly and severally liable for all agreements,
undertakings and obligations of Lessee.
(c) All captions and section, paragraph and other divisions
and subdivisions are for convenience of reference only and shall not affect the
construction, interpretation or meaning of the agreement or Lease or of any of
the provisions thereof.
(d) This Lease shall be governed by and construed according to
the law of the State of Washington.
(e) This Lease shall be binding upon and, except as limited in
Section 25 hereof, shall inure to the benefit of Lessor and Lessee and their
respective successors and assigns.
(f) This Lease cannot be canceled or terminated except as
expressly provided herein.
-13-
14
(g) Wherever Lessor's consent is required hereunder, such
consent will not be unreasonably withheld.
(h) Lessee's obligation to pay or reimburse Lessor for
expenses as provided hereunder shall be limited to reasonable expenses.
28. Lessor's Disclaimer
Lessee acknowledges and agrees that it has selected both the
Equipment of the type and quantity which is the subject of this Lease and the
supplier from whom the Equipment was purchased. LESSOR MAKES NO REPRESENTATION
OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE DESIGN, COMPLIANCE WITH
SPECIFICATIONS, CONDITION, QUALITY, WORKMANSHIP, OR THE SUITABILITY, ADEQUACY,
OPERATION, USE OR PERFORMANCE OF THE EQUIPMENT OR AS TO ITS MERCHANTABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE. ANY DELAY IN DELIVERY SHALL NOT AFFECT THE
VALIDITY OF THIS LEASE. The Lessee understands and agrees that neither the
supplier nor any salesman or any agent of the supplier is an agent of Lessor. No
salesman or agent of supplier 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 supplier shall in any way affect Lessee's duty to pay the rent and
perform its obligations as set forth in this Lease. Lessor shall not be liable
to Lessee for any incidental, consequential, or indirect damages or for any act,
neglect, omission, breach or default by any third party.
29. No Affiliation With Suppliers
lessee warrants that neither it nor any of its officers,
directors (if a corporation) or partners (if a partnership) has, directly or
indirectly, a substantial financial interest in the manufacturer or supplier of
any Equipment except as previously disclosed in writing to Lessor.
30. Entire Agreement
This Master Lease and any Lease Purchase Addenda hereto shall
constitute the entire agreement between the parties and shall not be altered or
amended except by an agreement in writing signed by the parties hereto or their
successors or assigns.
-14-
15
IN WITNESS WHEREOF, Lessor and Lessee have signed this agreement as of the day
and year first hereinabove written.
LESSOR: LESSEE: See attached Signature Page
METLIFE CAPITAL CORPORATION
By /s/ XXXXXXX X. XXXXXXXX By
---------------------------- -----------------------------------
Its Sr. Vice President Its
--------------------------- -----------------------------------
-15-
16
This Signature Page is attached to and made a part of that certain Master Lease
Purchase Agreement dated 11/21/1995 by and between MetLife Capital Corporation
("Lessor") and AMSCAN INC. ("Co-Lessee"), DECO PAPER PRODUCTS, INC.
("Co-Lessee"), KOOKABURRA USA, LTD. ("Co-Lessee"), and TRISAR, INC.
("Co-Lessee").
CO-LESSEE
AMSCAN INC.
By /s/ XXXXXX X. XXXXXX Address:
---------------------------------- South and Macy Road
Its TREASURER Xxxxxxxx, Xxx Xxxx 00000
---------------------------------
CO-LESSEE
DECO PAPER PRODUCTS, INC.
By /s/ XXXXXX X. XXXXXX Address:
---------------------------------- 0000 Xxxxxxx Xxxx
Xxx XXXXXXXXX Xxxxxxxxxx, Xxxxxxxx 00000
---------------------------------
CO-LESSEE
KOOKABURRA USA, LTD.
By /s/ XXXXXX X. XXXXXX Address:
---------------------------------- One Commerce Drive South
Its TREASURER Xxxxxxxx, XX 00000
---------------------------------
CO-LESSEE
TRISAR, INC.
By /s/ XXXXXX X. XXXXXX Address:
---------------------------------- 000 Xxx Xxxxxxx Xxxx
Xxx XXXXXXXXX Xxxxxxx, XX 00000
---------------------------------
-16-
17
LEASE PURCHASE ADDENDUM NO. ONE
THIS ADDENDUM is entered into the 21st day of November, 1995
between METLIFE CAPITAL CORPORATION ("Lessor") whose mailing address is C-97550,
Xxxxxxxx, Xxxxxxxxxx 00000 and AMSCAN INC. ("Co-Lessee"), DECO PAPER PRODUCTS,
INC. ("Co-Lessee"), KOOKABURRA USA, LTD. ("Co-Lessee"), and TRISAR, INC.
("Co-Lessee") whose addresses are Xxxxx & Xxxx Xxxx, Xxxxxxxx, XX 00000, 0000
Xxxxxxx Xxxx, Xxxxxxxxxx, XX 00000, Xxx Xxxxxxxx Xxxxx Xxxxx, Xxxxxxxx, XX 00000
and 000 Xxx Xxxxxxx Xxxx, Xxxxxxx, XX 00000, respectively.
Lessee has requested to lease from Lessor the following items
of personal property (individually, an "Item" and, collectively, the
"Equipment") for the prices and for delivery as follows:
-------------------------------------------------------------------------------------
Name and Address
of Supplier Quantity Complete
Description of Equipment Price
-------------------------------------------------------------------------------------
(New unless
otherwise specified)
See Attached
Schedule, [ ] check
if applicable
TO BE DETERMINED VARIOUS FLEXO
PRESSES, CUP, FOLDING, $6,000,000.00
PACKAGING AND
WAREHOUSE EQUIPMENT
TOTAL PRICE $6,000,000.00
FED. EXCISE TAX $
TRANSPORTATION $
OTHER $
-------------------------------------------------------------------------------------
Date Delivery Delivery Instructions to be
Expected: as specified by Lessee TOTAL COST: $6,000,000.00
On or before 12/31/95 to Supplier
-------------------------------------------------------------------------------------
Street City
County State
SHIP TO
LESSEE AT: AS PER LESSEE'S INSTRUCTIONS
-------------------------------------------------------------------------------------
Lessee and Lessor AGREE that subject to the conditions and agreements herein and
in the Master Lease referred to below (i) Lessor shall lease the Equipment to
Lessee, and (ii)
18
Lessee shall lease the Equipment from Lessor and perform and comply with the
provisions of this Agreement.
Certain Definitions and Stipulations:
Purchase Cut-Off Date: 12/31/95
Particular Lease Terms:
Length of Basic Term: One Hundred Twenty (120) months
Interim Rental Rate: (.25%) percentage point(s) above Chase
Manhattan Bank's Prime Rate
Periodic Rental Rate (for each installment) **1.1457% percent (%) of
Lessor's Cost of the
Equipment
Payment Schedule: Monthly in arrears
**The rental factor expressed above as a percentage of Equipment Cost will be
adjusted at lease closing in accordance with the following formula:
The rental factor will be converted to a simple interest equivalent rate that is
then increased or decreased 1% for each 1% (or pro rata for any fraction of 1%)
change in the average yield of seven-year U.S. Treasury Notes (as published in
the Federal Reserve Statistical Release H.15[519]) from the complete one week
period immediately preceding the date of lease closing. At the time of the
proposal dated August 21, 1995, the average yield for the prior week is 6.42%.
Purchase, Sale and Renewal Options:
(a) On the last date of the Lease Term, Lessee may
purchase for cash all but not less than all of the
Equipment then under lease for a price equal to
48.147% of Equipment Cost.
(b) If Lessee elects not to purchase the Equipment
pursuant to (a) above, then Lessee shall sell the
equipment in a commercially reasonable manner, or, at
Lessor's option, assuming Lessee has exercised its
option to sell, the Equipment will be sold by Lessor
as agent for Lessee. In no event will Lessee sell the
Equipment for less than 23.000% of Equipment Cost
without Lessor's prior written consent. All net
proceeds of sale shall be paid to Lessor; provided,
however, that if the net proceeds of sale exceed
48.147% of Equipment Cost, such excess shall be paid
to Lessee; provided further however, that if the net
proceeds of sale are less than 48.147% of Equipment
Cost, Lessee shall pay to Lessor the difference to a
maximum of 30.189% Equipment Cost.
-2-
19
(c) If neither purchase or sale options are exercised in
accordance with Sections (a) or (b) above, then on
the last date of the term the Lease will be renewed
for a period of Thirty six (36) months at a rental
payment equal to 1.14567% of Equipment Cost payable
monthly in arrears.
(d) Assuming the Lease is renewed pursuant to (c), on the
last date of renewal term, Lessee shall have the
option to purchase all but not less than all of the
Equipment then under Lease for a price equal to
15.000% of Equipment Cost.
(e) If Lessee does not exercise the purchase option
referred to in Section (d) above, then the Equipment
will be sold by Lessee, or at Lessor's option by
Lessor as agent for Lessee, in a commercially
reasonable manner, but in no event will Lessee sell
the Equipment for less than 12.000% of Equipment Cost
without Lessor's prior written consent. The net
proceeds of sale shall be paid to Lessor; provided,
however, that if the net proceeds exceed 15.000% of
Equipment Cost, then the excess shall be paid to
Lessee; provided further, however, that if the net
proceeds are less than 15.000% of Equipment Cost,
then Lessee shall pay the difference to Lessor to a
maximum of 8.777% of Equipment Cost.
Premises where Equipment will be kept: various
locations in NY, KY and CA
Insurance Required:
Liability. Not less than $1,000,000.00 Combined Single Limit
Liability insurance, including bodily injury and death and
property damage, naming Lessor as additional insured.
Physical Damage. Not less than $6,000,000.00 All risk physical
damage insurance, including loss by burglary, theft, and
malicious mischief, for full replacement value of the
equipment, naming Lessor as loss payee. Other. N/A
Yield Maintenance Premium: If at any time after the fifth (5th) year or at the
end of the Basic Term or prior to the end of any Renewal Term Lessee elects to
exercise its purchase or sale rights under the "Purchase Option" or "Sale of
Equipment" sections, or if Lessee otherwise elects to retire the outstanding
lease balance, then Lessee may be required to compensate Lessor for any yield
deficiency resulting from market interest rate fluctuations.
-3-
20
The Yield Maintenance Amount (YMA) is determined by (i) calculating the decrease
(expressed in basis points) in the current weekly average yield of five (5) Year
U.S. Treasury Notes ("Treasury Note Rate") (as published in Federal Reserve
Statistical Release H.15[519]) from 12/26/95 to the termination date, (ii)
dividing the difference by 100, (iii) multiplying the result by the applicable
premium factor shown below, and (iv) multiplying the product by the Purchase
Option Amount (if the Lease is terminating at the end of the Basic Term or the
First Renewal Term) or the outstanding lease balance (if the Lease is
terminating at any other time). In the event that the Treasury Note Rate either
remains the same or increases from 12/26/95 to the termination date, no YMA
shall be payable.
YMA Premium Factors
During Fifth Year of Basic Term .024
During Sixth Year of Basic Term .019
End of Basic Term/During First Year of Renewal Term .014
During Second Year of Renewal Term .010
During Third Year of Renewal Term .005
On the date of termination, Lessee shall pay Lessor the total of (i) Periodic
Rental due on that date and all other amounts due hereunder, (ii) the Purchase
Option Amount (if the Lease is terminating at the end of the Basic Term or the
First Renewal Term) or the outstanding lease balance (if the Lease is
terminating at any other time), (iii) the YMA, if applicable.
Master Lease: Lessor and Lessee are entering into or have entered into a Master
Lease Purchase Agreement ("Master Lease") dated 11/21/95. All of the terms,
conditions, agreements and provisions of the Master Lease are incorporated
herein by this reference and constitute a part of this Addendum. If there shall
be any conflict between any provision of the Master Lease and a provision of
this Addendum, the provision of the Addendum shall govern.
Lessor's Disclaimer: Lessee acknowledges and agrees that it has selected both
the Equipment of the type and quantity which is the subject of this Addendum and
the supplier from whom Lessor purchased the Equipment. LESSOR MAKES NO
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE DESIGN, COMPLIANCE
WITH SPECIFICATIONS, CONDITION, QUALITY, WORKMANSHIP, OR THE SUITABILITY,
ADEQUACY, OPERATION, USE OR PERFORMANCE OF THE EQUIPMENT OR AS TO ITS
MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE. ANY DELAY IN DELIVERY
SHALL NOT AFFECT THE VALIDITY OF THE MASTER LEASE OR THIS ADDENDUM. The Lessee
understands and agrees that neither the supplier nor any salesman nor any
-4-
21
agent of the supplier is authorized to waive or alter any term or condition of
the Master Lease or this Addendum, and no representation as to the Equipment or
any other matter by the supplier shall in any way affect Lessee's duty to pay
the rent and perform its obligations as set forth in the Master Lease or this
Addendum. Lessor shall not be liable to Lessee for incidental, consequential, or
indirect damages or for any act, neglect omission, breach or default by Lessor
or any third party.
LESSOR: CO-LESSEE:
METLIFE CAPITAL CORPORATION AMSCAN INC.
By /s/ XXXXXXX X. XXXXXXXX By /s/ XXXXXX X. XXXXXX
-------------------------- ------------------------------------
Its SENIOR VICE PRESIDENT Its TREASURER
-------------------------- ------------------------------------
CO-LESSEE:
DECO PAPER PRODUCTS, INC.
By /s/ XXXXXX X. XXXXXX
------------------------------------- ------------------------------------
Its TREASURER
------------------------------------- ------------------------------------
CO-LESSEE:
KOOKABURRA USA, LTD.
By /s/ XXXXXX X. XXXXXX
------------------------------------- ------------------------------------
Its TREASURER
------------------------------------- ------------------------------------
CO-LESSEE:
TRISAR, INC.
By /s/ XXXXXX X. XXXXXX
------------------------------------- ------------------------------------
Its TREASURER
------------------------------------- ------------------------------------
-5-
22
ADDENDUM NO. ONE
Addendum No. One to that certain Master Lease Purchase Agreement ("Agreement")
dated November 21, 1995 by and between METLIFE CAPITAL CORPORATION ("Lessor")
and AMSCAN INC. ("Co-Lessee"), DECO PAPER PRODUCTS, INC. ("Co-Lessee"),
KOOKABURRA USA, LTD. ("Co-Lessee"), and TRISAR, INC. ("Co-Lessee").
WHEREAS, the parties desire to enter into the Agreement provided that this
Addendum No. One is executed contemporaneously therewith;
NOW, THEREFORE, it is agreed as follows:
Section 17.(a) Events of Default shall be amended to include the following
additional paragraph:
(ix) failure to comply with the following Financial Covenant:
AMSCAN shall maintain Tangible Net Worth of not less than:
$24,000,000 on 12/31/95
$28,000,000 on 12/31/96
$33,500,000 on 12/31/97
$39,000,000 on 12/31/98
$44,500,000 on 12/31/99
Tangible Net Worth shall be defined as the sum of Total
Shareholders' Equity as stated in AMSCAN's annual audited
financial statements plus the Total Subordinated Debt as
stated in AMSCAN's audited financial statements and no
value shall be given to intangible assets.
IN WITNESS WHEREOF, parties have executed this Addendum No. One this 21st day of
November, 1995.
LESSOR: CO-LESSEE:
METLIFE CAPITAL CORPORATION AMSCAN INC.
By /s/ XXXXXXX X. XXXXXXXX By /s/ XXXXXX X. XXXXXX
------------------------------------ ---------------------------------
Its SENIOR VICE PRESIDENT Its TREASURER
----------------------------------- --------------------------------
23
CO-LESSEE:
DECO PAPER PRODUCTS, INC.
By /s/ XXXXXX X. XXXXXX
------------------------------------ ---------------------------------
Its TREASURER
------------------------------------ ---------------------------------
CO-LESSEE:
KOOKABURRA USA, LTD.
By /s/ XXXXXX X. XXXXXX
------------------------------------ ---------------------------------
Its TREASURER
------------------------------------ ---------------------------------
CO-LESSEE:
TRISAR, INC.
By /s/ XXXXXX X. XXXXXX
------------------------------------ ---------------------------------
Its TREASURER
------------------------------------ ---------------------------------
-2-
24
AMENDMENT NO. ONE
AMENDMENT NO. ONE to that certain Lease Purchase Addendum No.
One dated November 21, 1995 by and between METLIFE CAPITAL CORPORATION
("Lessor") and AMSCAN INC. ("Co-Lessee"), DECO PAPER PRODUCTS, INC.
("Co-Lessee"), KOOKABURRA USA, LTD. ("Co-Lessee"), and TRISAR, INC.
("Co-Lessee").
WHEREAS, the parties entered into the Addendum as aforesaid; and
WHEREAS, the parties now desire to amend the Addendum in certain respects;
NOW, THEREFORE, it is agreed as follows:
The Total Cost of the Equipment is hereby increased to $6,335,964.18.
The Length of Basic Term is hereby corrected to Eighty-four (84)
months.
IN WITNESS WHEREOF, the parties have executed this Amendment No. One this 12th
day of February, 1996.
LESSOR: CO-LESSEE:
METLIFE CAPITAL CORPORATION AMSCAN INC.
By /s/ XXXXXXX X. XXXXXXXX By /s/ XXXXXX X. XXXXXX
------------------------------------ ---------------------------------
Its SENIOR VICE PRESIDENT Its TREASURER
------------------------------------ ----------
CO-LESSEE:
DECO PAPER PRODUCTS, INC.
By /s/ XXXXXX X. XXXXXX
--------------------
Its TREASURER
----------
25
CO-LESSEE:
KOOKABURRA USA, LTD.
By /s/ XXXXXX X. XXXXXX
------------------------------------ ---------------------------------
Its TREASURER
------------------------------------ ---------------------------------
CO-LESSEE:
TRISAR, INC.
By /s/ XXXXXX X. XXXXXX
------------------------------------ ---------------------------------
Its TREASURER
------------------------------------ ---------------------------------
-2-
26
LEASE PURCHASE ADDENDUM NO. TWO
THIS ADDENDUM is entered into the 20th day of June, 1996
between METLIFE CAPITAL CORPORATION ("Lessor"), whose mailing address is
C-97550, Xxxxxxxx, Xxxxxxxxxx 00000 and AMSCAN INC. ("Co-Lessee"), and TRISAR,
INC. ("Co-Lessee"), whose addresses are 00 Xxxxxxxxxx Xxxx, Xxxxxxxx, XX 00000
and 000 Xxx Xxxxxxx Xxxx, Xxxxxxxx, XX 00000, respectively.
Lessee has requested to lease from Lessor the following items
of personal property (individually, an "Item" and, collectively, the
"Equipment") for the prices and for delivery as follows:
-------------------------------------------------------------------------------------
Name and Address
of Supplier Quantity Complete
Description of Equipment Price
-------------------------------------------------------------------------------------
(New unless
otherwise specified)
See Attached
Schedule, [ ] check
if applicable
VARIOUS TO BE Printing and
Warehouse Equipment $10,086,957.79
DETERMINED
TOTAL PRICE $10,086,957.79
FED. EXCISE TAX $
TRANSPORTATION $
OTHER $
-------------------------------------------------------------------------------------
Date Delivery Delivery Instructions to be
Expected: as specified by Lessee TOTAL COST: $10,086,957.79
On or before 12/30/96 to Supplier
-------------------------------------------------------------------------------------
Street City
County State
SHIP TO
LESSEE AT: As per Lessee's instructions
-------------------------------------------------------------------------------------
Lessee and Lessor AGREE that subject to the conditions and agreements herein and
in the Master Lease referred to below (i) Lessor shall lease the Equipment to
Lessee, and (ii) Lessee shall lease the Equipment from Lessor and perform and
comply with the provisions of this Agreement.
Certain Definitions and Stipulations:
27
Purchase Cut-Off Date: 12/30/96
Particular Lease Terms:
Length of Basic term: Eighty-four (84) months
Interim Rental Rate: (2.50%) percentage point(s) above Chase
Manhattan Bank's Prime Rate
Periodic Rental Rate (for each installment) **0.98835% percent (%) of
Lessor's Cost of the Equipment
Payment Schedule: Monthly in arrears
**The rental factor expressed above as a percentage of Equipment Cost will be
adjusted at lease closing in accordance with the following formula:
The rental factor will be converted to a simple interest equivalent rate that is
then increased or decreased 1% for each 1% (or pro rata for any fraction of 1%)
change in the average yield of seven-year U.S. Treasury Constant Maturities (as
published in the Federal Reserve Statistical Release H.15[519]) from the
complete one-week period immediately preceding the date of lease closing. At the
time of the proposal dated February 23, 1996, the average yield for the prior
week was 5.46%.
In addition, adjustment of the rental factors as provided above may require
corresponding adjustments to the Purchase Option and Maximum Guaranty
percentages to preserve Lessor's anticipated transaction economics. Lessee will
be provided with adjusted percentages at the time this option to fix the rate is
exercised.
Purchase, Sale and Renewal Options:
(a) On the last date of the Lease Term, Lessee may
purchase for cash all but not less than all of the
Equipment then under lease for a price equal to
59.713% of Equipment Cost.
(b) If Lessee elects not to purchase the Equipment
pursuant to (a) above, then Lessee shall sell all but
not less than all of the equipment in a commercially
reasonable manner, or, at Lessor's option, assuming
Lessee has exercised its option to sell, the
Equipment will be sold by Lessor as agent for Lessee.
In no event will Lessee sell the Equipment for less
than 25.000% of Equipment Cost without Lessor's prior
written consent. All net proceeds of sale shall be
paid to Lessor; provided however, that if the net
proceeds of sale exceed 59.713% of Equipment Cost,
such excess shall be paid to Lessee; provided further
however, that if the net proceeds of sale are less
than 59.713% of Equipment Cost, Lessee shall pay to
Lessor the difference to a maximum of 42.714%
Equipment Cost.
-2-
28
(c) If neither purchase or sale options are exercised in
accordance with Sections (a) or (b) above, then on
the last date of the term the Lease will be renewed
for a period of Thirty six (36) months at a rental
payment equal to 0.98835% of Equipment Cost payable
monthly in arrears.
(d) Assuming the Lease is renewed pursuant to (c), on the
last date of renewal term, Lessee shall have the
option to purchase all but not less than all of the
Equipment then under Lease for a price equal to
34.899% of Equipment Cost.
(e) If Lessee does not exercise the purchase option
referred to in Section (d) above, then all but not
less than all of the Equipment will be sold by
Lessee, or at Lessor's option by Lessor as agent for
Lessee, in a commercially reasonable manner, but in
no event will Lessee sell the Equipment for less than
15.000% of Equipment Cost without Lessor's prior
written consent. The net proceeds of sale shall be
paid to Lessor; provided however, that if the net
proceeds exceed 34.899% of Equipment Cost, then the
excess shall be paid to Lessee; provided further
however, that if the net proceeds are less than
34.899% of Equipment Cost, then Lessee shall pay the
difference to lessor to a maximum of 27.361% of
Equipment Cost.
Premises where Equipment will be kept: Various
Locations to be determined by Lessee
Insurance Required:
Liability. Not less than $1,000,000.00 Combined Single Limit
Liability insurance, including bodily injury and death and
property damage, naming Lessor as additional insured.
Physical Damage. Not less than $10,086,957.79 All risk
physical damage insurance, including loss by burglary, theft,
and malicious mischief, for full replacement value of the
equipment, naming Lessor as loss payee. Other. N/A.
Yield Maintenance Premium: If at any time after the sixth year or at the end of
the Basic Term or prior to the end of any Renewal Term Lessee elects to exercise
its purchase or sale rights under the "Purchase Option" or "Sale of Equipment"
sections, or if Lessee otherwise
-3-
29
elects to retire the outstanding lease balance, then Lessee may be required to
compensate Lessor for any yield deficiency resulting from market interest rate
fluctuations.
The Yield Maintenance Amount (YMA) is determined by (i) calculating the decrease
(expressed in basis points) in the current weekly average yield of seven (7)
Year U.S. Treasury Notes ("Treasury Note Rate") (as published in Federal Reserve
Statistical Release H.15[519]) from ___________ to the termination date, (ii)
dividing the difference by 100, (iii) multiplying the result by the applicable
premium factor shown below, and (iv) multiplying the product by the Purchase
Option Amount (if the lease is terminating at the end of the Basic Term or the
First Renewal Term) or the outstanding lease balance (if the lease is
terminating at any other time). In the event that the Treasury Note Rate either
remains the same or increases __________ from to the termination date, no YMA
shall be payable.
YMA Premium Factors
During Seventh Year of Basic Term .029
End of Basic Term/During First Year of First Renewal Term .024
During Second Year of First Renewal Term .019
During Third Year of First Renewal Term .014
End of First Renewal Term/During First Year of Second Renewal Term .010
During Second Year of Second Renewal Term .005
On the date of termination, Lessee shall pay Lessor the total of (i) Periodic
Rental due on that date and all other amounts due hereunder, (ii) the Purchase
Option Amount (if the lease is terminating at the end of the Basic Term or the
First Renewal Term) or the outstanding lease balance (if the lease is
terminating at any other time) (iii) the YMA, if applicable.
Master Lease: Lessor and Lessee are entering into or have entered into a Master
Lease Purchase Agreement ("Master Lease") dated November 21, 1995. All of the
terms, conditions, agreements and provisions of the Master Lease are
incorporated herein by this reference and constitute a part of this Addendum. If
there shall be any conflict between any provision of the Master Lease and a
provision of this Addendum, the provision of the Addendum shall govern.
Lessor's Disclaimer: Lessee acknowledges and agrees that it has selected both
the Equipment of the type and quantity which is the subject of this Addendum and
the supplier from whom Lessor purchased the Equipment. LESSOR MAKES NO
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE DESIGN, COMPLIANCE
WITH SPECIFICATIONS, CONDITION, QUALITY, WORKMANSHIP, OR THE SUITABILITY,
ADEQUACY, OPERATION, USE OR PERFORMANCE OF THE EQUIPMENT OR AS TO ITS
MERCHANTABILITY OR
-4-
30
FITNESS FOR ANY PARTICULAR PURPOSE. ANY DELAY IN DELIVERY SHALL NOT AFFECT THE
VALIDITY OF THE MASTER LEASE OR THIS ADDENDUM. The Lessee understands and agrees
that neither the supplier nor any salesman nor any agent of the supplier is
authorized to waive or alter any term or condition of the Master Lease or this
Addendum, and no representation as to the Equipment or any other matter by the
supplier shall in any way affect Lessee's duty to pay the rent and perform its
obligations as set forth in the Master Lease or this Addendum. Lessor shall not
be liable to Lessee for incidental, consequential, or indirect damages or for
any act, neglect omission, breach or default by Lessor or any third party.
LESSOR: CO-LESSEE:
METLIFE CAPITAL CORPORATION AMSCAN INC.
By /s/ XXXXXXX X. XXXXXXXX By /s/ XXXX X. XXXXXX
--------------------------------- -----------------------------------
Its /s/ VICE PRESIDENT Its /s/ VICE PRESIDENT
--------------------------------- -----------------------------------
CO-LESSEE:
TRISAR, INC.
By /s/ XXXX X. XXXXXX
-------------------------------
Its /s/ VICE PRESIDENT
-------------------------------
-5-
31
AMENDMENT NO. ONE
AMENDMENT NO. ONE to that certain Lease Purchase Addendum No.
Two dated June 20, 1996, by and between METLIFE CAPITAL CORPORATION "Lessor")
and AMSCAN INC. ("Co-Lessee"), and TRISAR, INC. ("Co-Lessee").
WHEREAS, the parties entered into the Lease as aforesaid; and
WHEREAS, the parties now desire to amend the Lease in certain respects;
NOW THEREFORE, it is agreed as follows:
The Interim Rental Rate is hereby corrected to read as follows: 2.50% percentage
point(s) above 30 Day Commercial Paper
"Early Termination:
Co-Lessees may terminate this lease any time after the sixth year of the lease,
subject to the payment of the unamortized balance of the lease based on a 12
year amortization schedule and the payment of a yield maintenance fee based on a
12 year lease term."
IN WITNESS WHEREOF, the parties have executed this Amendment No. One this 8th
day of July, 1996.
LESSOR: CO-LESSEE:
METLIFE CAPITAL CORPORATION AMSCAN INC.
By /s/ XXXXXXX X. XXXXXXXX By /s/ XXXX X. XXXXXX
--------------------------------- -----------------------------------
Its /s/ SENIOR VICE PRESIDENT Its /s/ VICE PRESIDENT
--------------------------------- -----------------------------------
CO-LESSEE:
TRISAR, INC.
By /s/ XXXX X. XXXXXX
----------------------------
Its /s/ VICE PRESIDENT
----------------------------
