Sample Business Contracts

Master Lease Agreement - Comdisco Inc. and NetScreen Technologies Inc.

Free Customizable Lease Forms

  • Commercial Lease. Start a state-specific lease for the rental of commercial property. Specify the term and rent due, as well as whether the landlord or tenant is responsible for property taxes, insurance, and maintenance and repairs.
  • Commercial Sublease. When a tenant vacates commercial property before the lease term has expired, it may be able to rent the premises to a third party. The tenant would be the sublessor and the third party would be the sublessee. Besides preparing a sublease, both parties will want to review the provisions for assignment or subletting in the original lease agreement between the landlord and the sublessor.
  • Sublease Agreement. Tenants of residential property should prepare a sublease agreement if they are seeking to sublease a room or the entire apartment or house to a third party. All parties should review the original lease agreement to see if there are any restrictions on subletting or assigning the premises.
  • Triple Net Lease. Triple net leases are a type of commercial leases where the tenant has to pay for property taxes, insurance, utilities, and maintenance, in addition to the monthly rent.
  • Office Space Lease. When renting an office space, tenants should understand the amount of the rent and duration of the lease. Other important terms include whether the space can be subleased, which parties are responsible for maintenance, and whether any furniture and furnishings will be provided.

Sponsored Links

                             MASTER LEASE AGREEMENT

     MASTER LEASE AGREEMENT (the "Master Lease") dated October 26, 1998 by and
between COMDISCO, INC. ("Lessor') and NETSCREEN TECHNOLOGIES, INC. ("Lessee").

     IN CONSIDERATION of the mutual agreements described below, the parties
agree as follows (all capitalized terms are defined in Section 14.18):

1.   Property Leased.

     Lessor leases to Lessee all of the Equipment described on each Summary
Equipment Schedule. In the event of a conflict, the terms of the applicable
Schedule prevail over this Master Lease.

2.   Term.

     On the Commencement Date, Lessee will be deemed to accept the Equipment,
will be bound to its rental obligations for each item of Equipment and the term
of a Summary Equipment Schedule will begin and continue through the Initial Term
and thereafter until terminated by either party upon prior written notice
received during the Notice Period. No termination may be effective prior to the
expiration of the Initial Term.

3.   Rent and Payment.

     Rent is due and payable in advance on the first day of each Rent Interval
at the address specified in Lessor's invoice. Interim Rent is due and payable
when invoiced. If any payment is not made when due, Lessee will pay a Late
Charge on the overdue amount. Upon Lessee's execution of each Schedule, Lessee
will pay Lessor the Advance specified on the Schedule. The Advance will be
credited towards the final Rent payment if Lessee is not then in default. No
interest will be paid on the Advance.

4.   Selection; Warranty and Disclaimer of Warranties.

     4.1  Selection.  Lessee acknowledges that it has selected the Equipment and
disclaims any reliance upon statements made by the Lessor, other than as set
forth in the Schedule.

     4.2  Warranty and Disclaimer of Warranties.  Lessor warrants to Lessee
that, so long as Lessee is not in default, Lessor will not disturb Lessee's
quiet and peaceful possession, and unrestricted use of the Equipment. To the
extent permitted by the manufacturer, Lessor assigns to Lessee during the term
of the Summary Equipment Schedule any manufacturers warranties for the
OR ITS FITNESS FOR A PARTICULAR PURPOSE. Lessor is not responsible for any
liability, claim, loss, damage or expense of any kind (including strict
liability in tort) caused by the Equipment except for any loss or damage caused
by the willful misconduct or negligent acts of Lessor. In no event is Lessor
responsible for special, incidental or consequential damages.



5.   Title; Relocation or Sublease; and Assignment.

     5.1  Title.  Lessee holds the Equipment subject and subordinate to the
rights of the Owner, Lessor, any Assignee and any Secured Party. Lessee
authorizes Lessor, as Lessee's agent, and at Lessor's expense, W prepare,
execute and file in Lessee's name precautionary Uniform Commercial Code
financing statements showing the interest of the Owner, Lessor, and any Assignee
or Secured Party in the Equipment and to insert serial numbers in Summary
Equipment Schedules as appropriate. Lessee will, at its expense, keep the
Equipment free and clear from any liens or encumbrances of any kind (except any
caused by Lessor) and will indemnify and hold the Owner, Lessor, any Assignee
and Secured Party harmless from and against any loss caused by Lessee's failure
to do so, except where such is caused by Lessor.

     5.2  Relocation or Sublease.  Upon prior written notice, Lessee may
relocate Equipment to any location within the continental United States provided
(i) the Equipment will not be used by an entity exempt from federal income tax,
and (it) all additional costs (including any administrative fees, additional
taxes and insurance coverage) are reconciled and promptly paid by Lessee.

     Lessee may sublease the Equipment upon the reasonable consent of the Lessor
and the Secured Party. Such consent to sublease will be granted if: (i) Lessee
meets the relocation requirements set out above, (ii) the sublease is expressly
subject and subordinate to the terms of Me Schedule, (iii) Lessee assigns its
rights in the sublease to Lessor and the Secured Party as additional collateral
and security, (iv) Lessee's obligation to maintain and insure the Equipment is
not altered, (v) all financing statements required to continue the Secured
Party's prior perfected security interest are filed, and No Lessee executes
sublease documents acceptable to Lessor.

     No relocation or sublease will relieve Lessee from any of its obligations
under this Master Lease and the relevant Schedule.

     5.3  Assignment by Lessor.  The terms and conditions of each Schedule have
been fixed by Lessor in order to permit Lessor to sell and/or assign or transfer
its interest or grant a security interest in each Schedule and/or the Equipment
to a Secured Party or Assignee. In that event, the term Lessor will mean the
Assignee and any Secured Party. However, any assignment, sale, or other transfer
by Lessor will not relieve Lessor of its obligations to Lessee and will not
materially change Lessee's duties or materially increase the burdens or risks
imposed on Lessee. The Lessee consents to and will acknowledge such assignments
in a written notice given to Lessee. Lessee also agrees that:

          (a)  The Secured Party will be entitled to exercise all of Lessor's
rights, but will not be obligated to perform any of the obligations of Lessor.
The Secured Party will not disturb Lessee's quiet and peaceful possession and
unrestricted use of the Equipment so long as Lessee is not in default and the
Secured Party continues to receive all Rent payable under the Schedule; and



          (b)  Lessee will pay all Rent and all other amounts payable to the
Secured Party, despite any defense or claim which it has against Lessor. Lessee
reserves its right to have recourse directly against Lessor for any defense or

          (c)  Subject to and without impairment of Lessee's leasehold rights in
the Equipment, Lessee holds the Equipment for the Secured Party to the extent of
the Secured Party's rights in that Equipment.

6.   Net Lease; Taxes and Fees.

     6.1  Net Lease.  Each Summary Equipment Schedule constitutes a net lease.
Lessee's obligation to pay Rent and all other amounts due hereunder is absolute
and unconditional and is not subject to any abatement, reduction, set-off,
defense, counterclaim, interruption, deferment or recoupment for any reason

     6.2  Taxes and Fees.  Lessee will pay when due or reimburse Lessor for all
taxes, fees or any other charges (together with any related interest or
penalties not arising from the negligence of Lessor) accrued for or arising
during the term of each Summary Equipment Schedule against Lessor, Lessee or the
Equipment by any governmental authority (except only Federal, state, local and
franchise taxes on the capital or the net income of Lessor). Lessor will file
all personal property tax returns for the Equipment and pay all such property
taxes due. Lessee will reimburse Lessor for property taxes within thirty (30)
days of receipt of an invoice.

7.   Care, Use and Maintenance; Inspection by Lessor.

     7.1  Care, Use and Maintenance.  Lessee will maintain the Equipment in good
operating order and appearance, protect the Equipment from deterioration, other
than normal wear and tear, and will not use the Equipment for any purpose other
than that for which it was designed. If commercially available and considered
common business practice for each item of Equipment, Lessee will maintain in
force a standard maintenance contract with the manufacturer of the Equipment, or
another party acceptable to Lessor, and will provide Lessor with a complete copy
of that contract. If Lessee has the Equipment maintained by a party other than
the manufacturer or self maintains. Lessee agrees to pay any costs necessary for
the manufacturer to bring the Equipment to then current release, revision and
engineering change levels, and to re-certify the Equipment as eligible for
manufacturer's maintenance at the expiration of the lease term, provided
re-certification is available and is required by Lessor. The lease term will
continue upon the same terms and conditions until recertification has been

     7.2  Inspection by Lessor.  Upon reasonable advance notice, Lessee, during
reasonable business hours and subject to Lessee's security requirements, will
make the Equipment and its related log and maintenance records available to
Lessor for inspection.

8.   Representations and Warranties of Lessee.  Lessee hereby represents,
warrants and covenants that with respect to the Master Lease and each Schedule
executed hereunder:

     (a)  The Lessee is a corporation duly organized and validly existing in
good standing under the laws of the jurisdiction of its incorporation, is duly
qualified to do business in each jurisdiction (including the jurisdiction where
the Equipment is, or is to be, located) where its



ownership or lease of property or the conduct of its business requires such
qualification, except for where such lack of qualification would not have a
material adverse effect on the Company's business; and has full corporate power
and authority to hold property under Me Master Lease and each Schedule and to
enter into and perform its obligations under the Master Lease and each Schedule.

     (b)  The execution and delivery by Me Lessee of the Master Lease and each
Schedule and its performance thereunder have been duly authorized by all
necessary corporate action on the part of Me Lessee, and the Master Lease and
each Schedule are not inconsistent with the Lessee's Articles of Incorporation
or Bylaws, do not contravene any law or governmental rule, regulation or order
applicable to it, do not and will not contravene any provision of, or constitute
a default under, any indenture, mortgage, contract or other instrument to which
it is a party or by which it is bound, and the Master Lease and each Schedule
constitute legal, valid and binding agreements of the Lessee, enforceable in
accordance with their terms, subject to the effect of applicable bankruptcy and
other similar laws affecting the rights of creditors generally and rules of law
concerning equitable remedies.

     (c)  There are no actions, suits, proceedings or patent claims pending or,
to the knowledge of the Lessee, threatened against or affecting the Lessee in
any court or before any governmental commission, board or authority which, if
adversely determined, will have a material adverse effect on the ability of the
Lessee to perform its obligations under the Master Lease and each Schedule.

     (d)  The Equipment is personal property and when subjected to use by the
Lessee will not be or become fixtures under applicable law.

     (e)  The Lessee has no material liabilities or obligations, absolute or
contingent (individually or in the aggregate), except the liabilities and
obligations of the Lessee as set forth in the Financial Statements and
liabilities and obligations which have occurred in the ordinary course of
business, and which have not been, in any case or in the aggregate, materially
adverse to Lessee's ongoing business.

     (f)  To the best of the Lessee's knowledge, the Lessee owns, possesses, has
access to, or can become licensed on reasonable terms under all patents, patent
applications, trademarks, trade names, inventions, franchises, licenses,
permits, computer software and copyrights necessary for the operations of its
business as now conducted, with no known infringement of, or conflict with, the
rights of others.

     (g)  All material contracts, agreements and instruments to which the Lessee
is a party are in full force and effect in all material respects, and are valid,
binding and enforceable by the Lessee in accordance with their respective terms,
subject to the effect of applicable bankruptcy and other similar laws affecting
the rights of creditors generally, and rules of law concerning equitable

9.   Delivery and Return of Equipment.

     Lessee hereby assumes the full expense of transportation and in-transit
insurance to Lessee's premises and installation thereat of the Equipment. Upon
termination (by expiration or



otherwise) of each Summary Equipment Schedule, Lessee shall, pursuant to
Lessor's instructions and at Lessee's full expense (including, without
limitation, expenses of transportation and in-transit insurance), return the
Equipment to Lessor in the same operating order, repair, condition and
appearance as when received, less normal depreciation and wear and tear. Lessee
shall return the Equipment to Lessor at 6111 North River Road, Rosemont,
Illinois 60018 or at such other address within the continental United States as
directed by Lessor, provided, however, that Lessee's expense shall be limited to
the cost of returning the Equipment to Lessor's address as set forth herein.
During the period subsequent to receipt of a notice under Section 2, Lessor may
demonstrate the Equipment's operation in place and Lessee will supply any of its
personnel as may reasonably be required to assist in the demonstrations.

10.  Labeling.

     Upon request, Lessee will mark the Equipment indicating Lessors interest
with labels provided by Lessor. Lessee will keep all Equipment free from any
other marking or labeling which might be interpreted as a claim of ownership.

11.  Indemnity.

     With regard to bodily injury and property damage liability only, Lessee
will indemnity and hold Lessor, any Assignee and any Secured Party harmless from
and against any and all claims, costs, expenses, damages and liabilities,
including reasonable attorneys' fees, arising out of the ownership (for strict
liability in tort only), selection, possession, leasing, operation, control,
use, maintenance, delivery, return or other disposition of the Equipment during
the term of this Master Lease or until Lessee's obligations under the Master
Lease terminate. However, Lessee is not responsible to a party indemnified
hereunder for any claims, costs, expenses, damages and liabilities occasioned by
the negligent acts of such indemnified party. Lessee agrees to carry bodily
injury and property damage liability insurance during the term of the Master
Lease in amounts and against risks customarily insured against by the Lessee on
equipment owned by it. Any amounts received by Lessor under that insurance will
be credited against Lessee's obligations under this Section.

12.  Risk of Loss.

     Effective upon delivery and until the Equipment is returned, Lessee
relieves Lessor of responsibility for all risks of physical damage to or loss or
destruction of the Equipment. Lessee will carry casualty insurance for each item
of Equipment in an amount not less than the Casualty Value. All policies for
such insurance will name the Lessor and any Secured Party as additional insured
and as loss payee, and will provide for at least thirty (30) days prior written
notice to the Lessor of cancellation or expiration, and will insure Lessor's
interests regardless of any breach or violation by Lessee of any representation,
warranty or condition contained in such policies and will be primary without
right of contribution from any insurance effected by Lessor. Upon the execution
of any Schedule, the Lessee will furnish appropriate evidence of such insurance
acceptable to Lessor.

     Lessee will promptly repair any damaged item of Equipment unless such
Equipment has suffered a Casualty Loss. Within fifteen (15) days of a Casualty
Loss, Lessee will provide



written notice of that loss to Lessor and Lessee will, at Lessee's option,
either (a) replace the item of Equipment with Like Equipment and marketable
title to the Like Equipment will automatically vest in Lessor or (b) pay the
Casualty Value and after that payment and the payment of all other amounts due
and owing with respect to that item of Equipment, Lessee's obligation to pay
further Rent for the item of Equipment will cease.

13.  Default, Remedies and Mitigation.

     13.1  Default.  The occurrence of any one or more of the following Events
of Default constitutes a default under a Summary Equipment Schedule:

          (a)  Lessee's failure to pay Rent or other amounts payable by Lessee
when due if that failure continues for five (5) business days after written
notice; or

          (b)  Lessee's failure to perform any other term or condition of the
Schedule or the material inaccuracy of any representation or warranty made by
the Lessee in the Schedule or in any document or certificate furnished to the
Lessor hereunder if that failure or inaccuracy continues for ten (10) business
days after written notice; or

          (c)  An assignment by Lessee for the benefit of its creditors, the
failure by Lessee to pay its debts when due, the insolvency of Lessee, the
filing by Lessee or the filing against Lessee of any petition under any
bankruptcy or insolvency law or for the appointment of a trustee or other
officer with similar powers, the adjudication of Lessee as insolvent, the
liquidation of Lessee, or the taking of any action for the purpose of the
foregoing; or

          (d)  The occurrence of an Event of Default under any Schedule, Summary
Equipment Schedule or other agreement between Lessee and Lessor or its Assignee
or Secured Party.

     13.2  Remedies.  Upon the occurrence of any of the above Events of Default,
Lessor, at its option, may:

          (a)  enforce Lessee's performance of the provisions of the applicable
Schedule by appropriate court action in law or in equity;

          (b)  recover from Lessee any damages and or expenses, including
Default Costs;

          (c)  with notice and demand, recover all sums due and accelerate and
recover the present value of the remaining payment stream of all Rent due under
the defaulted Schedule (discounted at the same rate of interest at which such
defaulted Schedule was discounted with a Secured Party plus any prepayment fees
charged to Lessor by the Secured Party or, if there is no Secured Party, then
discounted at 6%) together with all Rent and other amounts currently due as
liquidated damages and not as a penalty;

          (d)  with notice and process of law and in compliance with Lessee's
security requirements, Lessor may enter on Lessee's premises to remove and
repossess the Equipment



without being liable to Lessee for damages due to the repossession, except those
resulting from Lessors, its assignees', agents' or representatives' negligence;

          (e)  pursue any other remedy permitted bylaw or equity.

     The above remedies, in Lessor's discretion and to the extent permitted by
law, are cumulative and may be exercised successively or concurrently.

     13.3  Mitigation.  Upon return of the Equipment pursuant to the terms of
Section 13.2, Lessor will use its best efforts in accordance with its normal
business procedures (and without obligation to give any priority to such
Equipment) to mitigate Lessor's damages as described below. EXCEPT AS SET FORTH
otherwise dispose of all or any part of the Equipment at a public or private
sale for cash or credit with the privilege of purchasing the Equipment. The
proceeds from any sale, lease or other disposition of the Equipment are defined
as either:

          (a)  if sold or otherwise disposed of, the cash proceeds less the Fair
Market Value of the Equipment at the expiration of the Initial Term less the
Default Costs; or

          (b)  if leased, the present value (discounted at 3 percent (3%) over
the U.S. Treasury Notes of comparable maturity to the term of the re-lease) of
the rentals for a term not to exceed the Initial Term, less the Default Costs.

     Any proceeds will be applied against liquidated damages and any other sums
due to Lessor from Lessee. However, Lessee is liable to Lessor for, and Lessor
may recover, the amount by which the proceeds are less than the liquidated
damages and other sums due to Lessor from Lessee.

14.  Additional Provisions.

     14.1  Board Attendance.  One representative of Lessor will have the right
to attend Lessee's corporate Board of Directors meetings and Lessee will give
Lessor reasonable notice in advance of any special Board of Directors meeting,
which notice will provide an agenda of the subject matter to be discussed at
such board meeting. Lessee will provide Lessor with a certified copy of the
minutes of each Board of Directors meeting within thirty (30) days following the
date of such meeting held during he term of this Master Lease.

     14.2  Financial Statements.  As soon as practicable at the end of each
month (and in any event within thirty (30) days), Lessee will provide to Lessor
the same information which Lessee provides to its Board of Directors, but which
will include not less than a monthly income statement, balance sheet and
statement of cash flows prepared in accordance with generally accepted
accounting principles, consistently applied (the "Financial Statements"). As
soon as practicable at the end of each fiscal year, Lessee will provide to
Lessor audited Financial Statements setting forth in comparative form the
corresponding figures for the fiscal year 04 in any event within ninety (90)
days), and accompanied by an audit report and opinion of the



independent certified public accountants selected by Lessee. Lessee will
promptly furnish to Lessor any additional information (including, but not
limited to, tax returns, income statements, balance sheets and names of
principal creditors) as Lessor reasonably believes necessary to evaluate
Lessee's continuing ability to meet financial obligations. After the effective
date of the initial registration statement covering a public offering of
Lessee's securities, the term "Financial Statements" will be deemed to refer to
only those statements required by the Securities and Exchange Commission.

     14.3  Obligation to Lease Additional Equipment.  Upon notice to Lessee,
Lessor will not be obligated to lease any Equipment which would have a
Commencement Date after said notice if: (i) Lessee is in default under this
Master Lease or any Schedule; (ii) Lessee is in default under any loan
agreement, the result of which would allow the lender or any secured party to
demand immediate payment of any material indebtedness; (iii) there is a material
adverse change in Lessee's credit standing; or (iv) Lessor determines (in
reasonable good faith) that Lessee will be unable to perform its obligations
under this Master Lease or any Schedule.

     14.4  Merger and Sale Provisions.  Lessee will notify Lessor of any
proposed Merger at least sixty (60) days prior to the closing date. Lessor may,
in its discretion, either (i) consent to the assignment of the Master Lease and
all relevant Schedules to the successor entity, or (ii)terminate the Lease and
all relevant Schedules. If Lessor elects to consent to the assignment, Lessee
and its successor will sign the assignment documentation provided by Lessor. If
Lessor elects to terminate the Master Lease and all relevant Schedule, then
Lessee will pay Lessor all amounts ten due and owing and a termination fee equal
to the present value (discounted at 6%) of the remaining Rent for the balance of
the initial Term(s) of all Schedules, and will return the Equipment in
accordance with Section 9. Lessor hereby consents to any Merger in which the
acquiring entity has a Moody's Bond Rating of BA3 or better or a commercially
acceptable equivalent measure of creditworthiness as reasonably determined by

     14.5  Entire Agreement.  This Master Lease and associated Schedules and
Summary Equipment Schedules supersede all other oral or written agreements or
understandings between the parties concerning the Equipment including, for

     14.6  No Waiver.  No action taken by Lessor or Lessee will be deemed to
constitute a waiver of compliance with any representation, warranty or covenant
contained in this Master Lease or a Schedule. The waiver by Lessor or Lessee of
a breach of any provision of this Master Lease or a Schedule will not operate or
be construed as a waiver of any subsequent breach.

     14.7  Binding Nature.  Each Schedule is binding upon, and inures to the
benefit of Lessor and its assigns. LESSEE MAY NOT ASSIGN ITS RIGHTS OR

     14.8  Survival of Obligations.  All agreements, obligations including, but
not limited to those arising under Section 6.2, representations and warranties
contained in this Master Lease, any Schedule, Summary Equipment Schedule or in
any document delivered in connection with



those agreements are for the benefit of Lessor and any Assignee or Secured Party
and survive the execution, delivery, expiration or termination of this Master

     14.9  Notices. Any notice, request or other communication to either party
by the other will be given in writing and deemed received upon the earlier of
(1) actual receipt or (2) three days after mailing if mailed postage prepaid by
regular or airmail to Lessor (to the attention of "the Comdisco Venture Group")
or Lessee, at the address set out in the Schedule, (3) one day after it is sent
by courier or (4) on the same day as sent via facsimile transmission, provided
that the original is sent by personal delivery or mail by the sending party.


     14.11 Severability. If any one or more of the provisions of this Master
Lease or any Schedule is for any reason held invalid, illegal or unenforceable,
the remaining provisions of this Master Lease and any such Schedule will be
unimpaired, and the invalid, illegal or unenforceable provision replaced by a
mutually acceptable valid, legal and enforceable provision that is closest to
the original intention of the parties.

     14.12 Counterparts. This Master Lease and any Schedule may be executed in
any number of counterparts, each of which will be deemed an original, but all
such counterparts together constitute one and the same instrument. If Lessor
grants a security interest in all or any part of a Schedule, the Equipment or
sums payable thereunder, only that counterpart Schedule marked "Secured Party's
Original" can transfer Lessor's rights and all other counterparts will be marked

     14.13 Licensed Products. Lessee will obtain no title to Licensed Products
which will at all times remain the property of the owner of the Licensed
Products. A license from the owner may be required and it is Lessee's
responsibility to obtain any required license before the use of the Licensed
Products. Lessee agrees to treat the Licensed Products as confidential
information of the owner, to observe all copyright restrictions, and not to
reproduce or sell the Licensed Products.

     14.14 Secretary's Certificate. Lessee will, upon execution of this Master
Lease, provide Lessor with a secretary's certificate of incumbency and
authority. Upon the execution of each Schedule with a purchase price in excess
of $1,000,000, Lessee will provide Lessor with an opinion from Lessee's counsel
in a form acceptable to Lessor regarding the representations and warranties in
Section 8.

     14.15 Electronic Communications. Each of the parties may communicate with
the other by electronic means under mutually agreeable terms.



     14.16 Landlord/Mortgagee Waiver. Lessee agrees to provide Lessor with a
Landlord/Mortgagee Waiver with respect to the Equipment. Such waiver shall be in
a form satisfactory to Lessor.

     14.17 Equipment Procurement Charges/Progress Payments. Lessee hereby agrees
that Lessor shall not, by virtue of its entering into this Master Lease, be
required to remit any payments to any manufacturer or other third party until
Lessee accepts the Equipment subject to this Master Lease.

     14.18 Definitions.

     Advance - means be amount due to Lessor by Lessee upon Lessee's execution
of each Schedule.

     Assignee - means an entity to whom Lessor has sold or assigned its rights
as owner and Lessor of Equipment.

     Casualty Loss - means the irreparable loss or destruction of Equipment.

     Casualty Value - means the greater of the aggregate Rent remaining to be
paid for the balance of the lease term or the Fair Market Value of the Equipment
immediately prior to the Casualty Loss. However, if a Casualty Value Table is
attached to the relevant Schedule its terms will control.

     Commencement Date - is defined in each Schedule.

     Default Costs - means reasonable attorney's fees and remarketing costs
resulting from a Lessee default or Lessor's enforcement of its remedies.

     Delivery Date - means date of delivery of Inventory Equipment to Lessee's

     Equipment - means the property described on a Summary Equipment Schedule
and any replacement for that property required or permitted by this Master Lease
or a Schedule.

     Event of Default - means the events described in Subsection 13.1.

     Fair Market Value - means the aggregate amount which would be obtainable in
an arm's-length transaction between an informed and willing buyer/user and an
informed and willing seller under no compulsion to sell.

     Initial Term - means the period of time beginning on the first day of the
first full Rent Interval following the Commencement Date for all items of
Equipment and continuing for the number of Rent Intervals indicated on a

     Interim Rent - means the pro-rata portion of Rent due for the period from
the Commencement Date through but not including the first day of the first full
Rent interval included in the Initial Term.



     Late Charge - means the lesser of five percent (5%) of the payment due or
the maximum amount permitted by the law of the state where the Equipment is

     Licensed Products - means any software or other licensed products attached
to the Equipment.

     Like Equipment - means replacement Equipment which is lien free and of the
same model, type, configuration and manufacture as Equipment.

     Merger - means any consolidation or merger of the Lessee with or into any
other corporation or entity, any sale or conveyance of all or substantially all
of the assets or stock of the Lessee by or to any other person or entity in
which Lessee is not the surviving entity.

     Notice Period - means not less than ninety (90) days nor more than twelve
(12) months prior to the expiration of the lease term.

     Owner - means the owner of Equipment.

     Rent - means the rent Lessee will pay for each item of Equipment expressed
in a Summary Equipment Schedule either as a specific amount or an amount equal
to the amount which Lessor pays for an item of Equipment multiplied by a lease
rate factor plus all other amounts due to Lessor under this Master Lease or a

     Rent Interval - means a full calendar month or quarter as indicated on a

     Schedule - means either an Equipment Schedule or a Licensed Products
Schedule which incorporates all of the terms and conditions of this Master

     Secured Party - means an entity to whom Lessor has granted a security
interest for the purpose of securing a loan.

     Summary Equipment Schedule - means a certificate provided by Lessor
summarizing all of the Equipment for which Lessor has received Lessee approved
vendor invoices, purchase documents and/or evidence of delivery during a
calendar quarter which will incorporate all of the terms and conditions of the
related Schedule and this Master Lease and will constitute a separate lease for
the equipment leased thereunder.

     IN WITNESS WHEREOF, the parties hereto have executed this Master Lease on
or as of the day and year first above written.

as Lessee                                    as Lessor

By: /s/ Brian Kerr                           By: /s/ Jill Hanses
    -----------------------------                -------------------------------

Title: Director of Finance                   Title: SVP
       --------------------------                   ----------------------------



                                 ADDENDUM TO THE
                          AND COMDISCO, INC., AS LESSOR

         The undersigned hereby agree that the terms and conditions of the
above-referenced Master Lease are hereby modified and amended as follows:

1)       14.1., "Board Attendance"

         Delete this section in its entirety.

2)       14.2., "Financial Statements"

         In line 8, delete "ninety (90)" and insert "one hundred twenty (120)".

3)       14.4., "Merger and Sale Provisions"

         In line 2, delete "sixty (60)" and insert "thirty (30)".

4)       Interim Rent change

         Subsection 14.1 8, definition "Interim Rent", delete "the pro-rata
         portion" and replace with "0.020%".

AS LESSEE                               AS LESSOR

By: /s/ Brian Kerr                      By: /s/ Jill C. Hanses
    -------------------------------         ------------------------------------

Title: Director of Finance              Title: SVP
       ----------------------------            ---------------------------------

Date: October 27, 1998                  Date: October 28, 1998
      -----------------------------           ----------------------------------


                             EQUIPMENT SCHEDULE VL-1
                           DATED AS OF OCTOBER 27, 1998
                            TO MASTER LEASE AGREEMENT
                DATED AS OF OCTOBER 27, 1998 (THE "MASTER LEASE")
<S>     <C>                                                      <C>

Admin. Contact/Phone No.:                                        Address for all Notices:
------------------------                                         -----------------------
Brian Kerr                                                       6111 North River Road
Phone: (408) 970-8889                                            Rosemont, Illinois 60018
Fax: (408) 970-9818                                              Attn.: Venture Group

Address for Notices:
2860 San Tomas Expressway
Santa Clara, CA 95051

Central Billing Location:                                        Rent Interval: Monthly
------------------------                                         -------------
same as above


Lessee Reference No.:
(24 digits maximum)

Location of Equipment:                                           Initial Term:      42 months
---------------------                                            ------------
same as above                                                    (Number of Rent Intervals)

                                                                 Lease Rate Factor: 2.687%

EQUIPMENT (as defined below):                                    Advance:           Payable with each Summary
                                                                 -------            Equipment Schedule


Equipment specifically approved by Lessor, which shall be delivered to and
accepted by Lessee during the period October 27, 1998 through October 27, 1999
("Equipment Delivery Period"), for which Lessor receives vendor invoices
approved for payment, up to an aggregate purchase price of $317,665.35
("Commitment Amount"); excluding custom use equipment, leasehold improvements,
installation costs and delivery costs, rolling stock, special tooling,
"stand-alone" software, application software bundled into computer hardware,
hand held items, molds and fungible items.


1. Equipment Purchase

     This Schedule contemplates Lessor's acquisition of Equipment for lease to
Lessee, either by one of the first three categories listed below or by providing
Lessee with Equipment from the fourth category, in an aggregate value up to the
Commitment Amount referred to on the face of this Schedule. If the Equipment
acquired is of category (i), (ii), (iii) below, the effectiveness of this
Schedule as it relates to those items of Equipment is contingent upon Lessee's
acknowledgment at the time Lessor acquires the Equipment that Lessee has either
received or approved the relevant purchase documentation between vendor and
Lessor for that Equipment.

     (i)   NEW ON-ORDER EQUIPMENT. Lessor will purchase new Equipment which is
           obtained from a vendor by Lessee Or is use subject to Lessor's prior
           approval of the Equipment.

     (ii)  SALE-LEASEBACK EQUIPMENT. Any in-place Equipment installed at
           Lessee's site and to which Lessee has clear title and ownership may
           be considered by Lessor for inclusion under this Lease (the "Sale-
           Leaseback Transaction"). Any request for a Sale-Leaseback Transaction
           must be submitted to Lessor in writing (along with accompanying
           evidence of Lessee's Equipment ownership satisfactory to Lessor for
           all Equipment submitted) no later than November 27, 1998*. Lessor
           will not perform a Sale-Leaseback Transaction for any request or
           accompanying Equipment ownership documents which arrive after the
           date marked above by an asterisk (*). Further, any sale-leaseback
           Equipment will be placed on lease subject to: (1) Lessor prior
           approval of the Equipment; and (2) if approved, at Lessor's actual
           net appraised Equipment value pursuant to the schedule below:

                  DATE                       NET EQUIPMENT COST PAID BY LESSOR
       --------------------------            ----------------------------------
   Between 7/29/98 and 10/26/98 (90 days)                   100%

Lessee represents that it has paid all California sales tax due on the cost of
that portion of Equipment to be installed in California and agrees to provide
evidence of such payment to Lessor, if specifically requested. As a result of
the election, Lessor agrees that it will not invoice Lessee for use tax on the
monthly rental rate. Lessee understands that this is an irrevocable election to
measure the tax by the Equipment cost and cannot be changed except prior to
installation of the Equipment

     (iii) USED ON-ORDER EQUIPMENT. Lessor will purchase used Equipment which is
           obtained from a third party by Lessee for its use subject to
           Lessor's prior approval of the Equipment and at Lessor's appraised
           value for such used Equipment.

     (iv)  800 NUMBER EQUIPMENT. Upon Lessee's use of Comdisco's 1-800 Direct
           Service, Lessor will purchase new or used Equipment from a third
           party or Lessor


           will supply new or used Equipment from its inventory for use by
           Lessee at rates provided by Lessor.

2. Commencement Date

     The Commencement Date for each item of new on-order or used on-order
Equipment will be the install date as confirmed in writing by Lessee as set
forth on the vendor invoice of which a facsimile transmission will constitute an
original document. The Commencement Date for sale-leaseback Equipment shall be
the date Lessor tenders the purchase price. The Commencement Date for 800 Number
Equipment shall be fifteen (15) days from the ship date, such ship date to be
set forth on the vendor invoice or if unavailable on the vendor invoice the ship
date will be determined by Lessor upon other supporting shipping documentation.
Lessor will summarize all approved invoices, purchase documentation and evidence
of delivery, as applicable, received in the same calendar quarter into a Summary
Equipment Schedule in the form attached to this Schedule as Exhibit 1, and the
Initial Term will begin the first day of the calendar quarter thereafter. Each
Summary Equipment Schedule will contain the Equipment location, description,
serial number(s) and cost and will incorporate the terms and conditions of the
Master Lease and this Schedule and will constitute a separate lease.

3. Option to Extend

     So long as no Event of Default has occurred and is continuing hereunder,
and upon written notice no earlier than twelve (12) months and no later than
ninety (90) days prior to the expiration of the Initial Term of a Summary
Equipment Schedule, Lessee will have the right to extend the Initial Term of
such Summary Equipment Schedule for a period of one (1) year. In such event, the
rent to be paid during said extended period shall be mutually agreed upon and if
the parties cannot mutually agree, then the Summary Equipment Schedule shall
continue in full force and effect pursuant to the existing terms and conditions
until terminated in accordance with its terms. The Summary Equipment Schedule
will continue in effect following said extended period until terminated by
either party upon not less than ninety (90) days prior written notice, which
notice shall be effective as of the date of receipt.

4. Purchase Option

     So long as no Event of Default has occurred and is continuing hereunder,
and upon written notice no earlier than twelve (12) months and no later than
ninety (90) days prior to the expiration of the Initial Term or the extended
term of the applicable Summary Equipment Schedule, Lessee will have the option
at the expiration of the Initial Term of the Summary Equipment Schedule to
purchase all, but not less than all, of the Equipment listed therein for a
purchase price not to exceed 15% of the Equipment cost and upon terms and
conditions to be mutually agreed upon by the parties following Lessee's written
notice, plus any taxes applicable at time of purchase. Said purchase price shall
be paid to Lessor at least thirty (30) days before the expiration date of the
Initial Term or extended term. Title to the Equipment shall automatically pass
to Lessee upon payment in full of the purchase price but, in no event, earlier
than the expiration of the fixed Initial Term or extended term, if applicable.
If the parties are unable to agree on the purchase price or the terms and
conditions with respect to said purchase, then the Summary Equipment Schedule
with respect to this Equipment shall remain in full force



and effect. Notwithstanding the exercise by Lessee of this option and payment of
the purchase price, until all obligations under the applicable Summary Equipment
Schedule have been fulfilled, it is agreed and understood that Lessor shall
retain a purchase money security interest in the Equipment listed therein and
the Summary Equipment Schedule shall constitute a Security Agreement under the
Uniform Commercial Code of the state in which the Equipment is located.

5. Technology Exchange Option

     If Lessee is not in default, and there is no material adverse change in
Lessee's credit, on or after the expiration of the 12th month of any Summary
Equipment Schedule, Lessee shall have the option to replace any of the Equipment
subject to such summary Equipment Schedule with new technology equipment ("New
Technology Equipment") utilizing the following guidelines:

     A. Equipment being replaced with New Technology Equipment shall have an
aggregate original cost equal to or greater than, $20,000 and be comprised of
full configurations of equipment.

     B. This technology Exchange Option shall be limited to a maximum in the
aggregate of fifty percent (50%) of the original equipment cost and shall not
apply to software or any soft costs financed hereunder including but not limited
to tenant improvements and custom equipment.

     C. The cost of the New Technology Equipment must be equal to or greater
than the original equipment cost of the replaced equipment, but in no event
shall exceed 150% of the original equipment cost.

     D. The remaining lease payments applicable to the equipment being replaced
by the New Technology Equipment will be discounted to present value at 6%.

     The wholesale market value of the equipment being replaced will be
established by Comdisco based upon then current market conditions. Upon the
return of there placed equipment, the wholesale price will be deducted from the
present value of the remaining rentals and the differential will be added to the
cost of the New Technology Equipment in calculating the new rental. The lease
for the New Technology Equipment will contain terms and conditions substantially
similar to those for the replaced equipment and will have an Initial Term not
less than the balance of he remaining Initial Term for the replaced equipment.

6. Special Terms

     The terms and conditions of the Lease as they pertain to this Schedule are
hereby modified and amended as follows:

     Master Lease: This Schedule is issued pursuant to the Lease identified on
page 1 of this Schedule. All of the terms and conditions of the Lease are
incorporated in and made a part of this Schedule as if they were expressly set
forth in this Schedule. The parties hereby reaffirm all of the terms and
conditions of the Lease (including, without limitation, the representations and



warranties set forth in Section 8) except as modified herein by this Schedule.
This Schedule may not be amended or rescinded except by a writing signed by both

NETSCREEN TECHNOLOGIES, INC.                            COMDISCO, INC.,
as Lessee                                               as Lessor

By: /s/ Brian Kerr                                      By: /s/ Jill C. Hanses
    -------------------------                               --------------------

Title: Director of Finance                              Title: SVP
       ----------------------                                  -----------------

Date: October 27, 1988                                  Date: October 28, 1998
      -----------------------                                 ------------------



                                    EXHIBIT 1

                           SUMMARY EQUIPMENT SCHEDULE

     This Summary Equipment Schedule dated XXXX is executed pursuant to
Equipment Schedule No. X to the Master Lease Agreement dated XXXX between
Comdisco, Inc. ("Lessor") and XXXX ("Lessee"). All of the terms, conditions,
representations and warranties of the Master Lease Agreement and Equipment
Schedule No. X are incorporated herein and made a part hereof, and this Summary
Equipment Schedule constitutes a Schedule for the Equipment on the attached

1.  For Period Beginning:                    And Ending:
    --------------------                     ----------

2.  Initial Term Starts on:                  Initial Term:
    ----------------------                   ------------
                                             (Number of Rent Intervals)

3.  Total Summary Equipment Cost:

4.  Lease Rate Factor:

5.  Rent:

6.  Acceptance Doc Type: