Term Lease Master Agreement - IBM Credit Corp. and Prosoft Development Corp.
IBM CREDIT CORPORATION STAMFORD, CT 06904
TERM LEASE MASTER AGREEMENT
Name and Address of Lessee: PROSOFT DEVELOPMENT CORP Agreement No.7336742
PROSOFT DEV CORP
7100 KNOTT AVE
BUENA PARK, CA 90620-1314 Branch Office No.:PZF
Branch Office Address: S. Calif DMC Customer No. 7336742
2929 N. Central Ave
Phoenix, AZ 85012-2743
The Lessor pursuant to this Term Lease Master Agreement (Agreement) will be (a)
IBM Credit Corporation, or a subsidiary or affiliate thereof, (b) a partnership
in which IBM Credit Corporation is a partner, or (c) a related business
enterprise for whom IBM Credit Corporation is the agent (Lessor). The subject
matter of the lease shall be machines, field installation upgrades, feature
addition or accessories marketed by international Business Machines Corporation
(IBM) and shall be referred to as Equipment. Any lease transaction
requested by Lessee and accepted by Lessor shall be specified in a Term Lease
Supplement (Supplement). A Supplement shall refer to and incorporate by
reference this Agreement and, when signed by the parties, shall constitute the
lease (Lease) for the Equipment specified therein. Additional details
pertaining to a Lease shall be specified in a Supplement. A supplement may also
specify additional terms and conditions as well as other amounts to be financed
(Financing). Financing may include licensed program material charges (LPM
Charges) for licensed programs marketed by IBM under the referenced IBM license
agreement (License Agreement).
1. OPTIONS: The Supplement shall designate various lease and financing
options. Option A is a Lease available only for Modifications (Paragraph 23) to
Equipment under Option A prior to enactment of the Tax Reform Act of 1986.
Option B is a Lease with a fair market purchase option at the end of the Lease.
For Equipment under Option B Prime (B), Lessor assumes for tax purposes that
Lessee is the owner. For financing LPM Charges, Option 5 will apply.
2. CREDIT REVIEW. For each Lease, Lessee consents to any reasonable credit
investigation and review by Lessor.
3. AGREEMENT TERM. This Agreement shall be effective when signed by both
parties and may be terminated by either party upon one month's written notice.
However, each Lease then in effect shall survive any termination of this
Agreement.
4. CHANGES. Lessor may, upon prior written notice, change the terms and
conditions of this Agreement. And changes will apply on the effective date
specified in the notice to Leases which have an Estimated Shipment Date, or
Effective Date for Additional License, one month or more after the date of
notice. By notice to Lessor in writing prior to delivery, or Effective Date for
Additional License, and within 15 days after receipt of such notice, Lessee may
terminate the Lease for an affected item. Otherwise, the change shall apply.
5. ADVANCE RENT. Lessee shall pay to Lessor, prior to Lessor's acceptance
of a Lease, Advance Rent, if specified. Advance Rent shall be refunded if
Lessor for any reason does not accept the Lease or Lessee terminates the Lease
in accordance with Paragraph 4, 12, or 15.
6. SELECTION AND USE OF EQUIPMENT, PROGRAMMING AND LICENSED PROGRAM
MATERIALS. Lessee agrees that it shall be responsible for the selection, use of
and results obtained from, the Equipment, any programming supplied by IBM
without additional charge for use on the Equipment (Programming) licensed
program materials and any other associated equipment, programs or services .
7. ASSIGNMENT TO LESSOR. Lessee hereby assigns, exclusively to Lessor,
Lessee's right to purchase the Equipment from IBM. This assignment is effective
when Lessor accepts the applicable Supplement and Lessor shall then be obligated
to purchase and pay for the Equipment. Other than the obligation to pay the
purchase price, all responsibilities and limitations applicable to Customer as
defined in the referenced IBM purchase agreement in effect at the time the Lease
is accepted by Lessor (Purchase Agreement) shall apply to Lessee.
If the Equipment is subject to a volume procurement amendment to the
Purchase Agreement or to another discount offering (a) Lessor will pay the same
amount for the Equipment that would have been payable by Lessee, and (b) Lessee
will remain responsible to IBM for any late order change charges, settlement
charges, adjustment charges or any other charges incurred under the volume
procurement or other discount offering.
8. LEASE NOT CANCELLABLE: LESSEE'S OBLIGATIONS ABSOLUTE. Lessee's
obligation to pay shall be absolute and unconditional and shall not be subject
to any delay, reduction, set-off, defense, counterclaim or recoupment for any
reason whatsoever, including any failure of the Equipment, Programming or
licensed program materials or any representations by IBM. If the Equipment,
Programming, or licensed program materials are unsatisfactory for any reason,
Lessee shall make any claim solely against IBM and shall, never less, pay Lessor
all amounts payable under the Lease.
9. WARRANTIES Lessor grants to Lessee the benefit of any and all
warranties made available by IBM in the Purchase Agreement. Lessor warrants that
neither Lessor nor anyone acting or claiming through Lessor, by assignment or
otherwise, will interfere with Lessee's quiet enjoyment of the use of the
Equipment so long as no event of default shall have occurred and be continuing.
EXCEPT FOR LESSOR'S WARRANTY OF QUIET ENJOYMENT, LESSOR MAKES NO WARRANTY
EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING, BUT NOT LIMITED TO,
THE IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
AS TO LESSOR, LESSEE LEASES THE EQUIPMENT AND TAKES
THE ADDITIONAL TERMS AND CONDITIONS ON PAGES 2 THROUGH 4 ARE PART OF THIS
AGREEMENT.
LESSEE ACKNOWLEDGES THAT LESSEE HAS READ THIS AGREEMENT AND ITS SUPPLEMENT,
UNDERSTANDS THEM, AND AGREES TO BE BOUND BY THEIR TERMS AND CONDITIONS. FURTHER,
LESSEE AGREES THAT THIS AGREEMENT AND ITS SUPPLEMENT ARE THE COMPLETE AND
EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN THE PARTIES, SUPERSEDING ALL
PROPOSALS OR PRIOR AGREEMENTS, ORAL OR WRITTEN, AND ALL OTHER COMMUNICATIONS
BETWEEN THE PARTIES RELATING TO THE SUBJECT MATTER THEREOF.
[_] INITIAL IF AGREEMENT COVERAGE PAGE IS ATTACHED.
Accepted by:
IBM Credit Corporation PROSOFT DEVELOPMENT CORP
-------------------------------
For or as lessor
By: By: /s/ JAMES P. STAPLETON
---------------------------- ----------------------------
Authorized Signature Authorized Signature
JAMES P. STAPLETON 4-19-96
-------------------------------- ----------------------------
Name (Type or Print) Date Name (Type or Print) Date
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ANY PROGRAMMING 'AS IS' IN NO EVENT SHALL LESSOR HAVE ANY LIABILITY FOR, NOR
SHALL LESSEE HAVE ANY REMEDY AGAINST LESSOR FOR CONSEQUENTIAL DAMAGES, ANY LOSS
OF PROFITS OR SAVINGS, LOSS OF USE, OR ANY OTHER COMMERCIAL LOSS.
10. LESSEE AUTHORIZATION. So long as Lessee is not in default under the
Lease (a) Lessee is authorized to act on Lessor's behalf concerning delivery and
installation of the Equipment, any IBM warranty service for the Equipment and
any programming services for the Programming and (b) Lessee shall have solely
for these purposes, all rights Lessor may have against IBM under the Purchase
Agreement. The foregoing authorization shall not constitute any surrender of
Lessor's interest in the Equipment.
11. DELIVERY AND INSTALLATION. Lessee shall arrange with IBM for the
delivery of the Equipment and Programming and for installation of the Equipment
at the Equipment Location. Lessee shall pay any delivery and installation
charges. Lessor shall not be liable to Lessee for any delay in or failure of
delivery of the Equipment and Programming. Lessee shall examine equipment and
programming immediately upon delivery. If the equipment is not in good condition
or the equipment or programming does not correspond to IBM's specifications.
Lessee shall promptly give IBM written notice and shall provide IBM reasonable
assistance to cure the detect or discrepancy.
12. LATE DELIVERY. If the equipment or licensed program materials are not
delivered to the equipment location on or before the 15th day after the
estimated shipment date, Lessor may, upon written notice to Lessee, increase the
Lease Rate. Lessee may terminate the Lease for the affected item by giving
Lessor written notice prior to delivery. Otherwise, the rent shall be adjusted
to reflect such increase.
13. RENT COMMENCEMENT DATE. The Rent Commencement Date, unless otherwise
specified in the Supplement, shall be the date payment is due IBM under the
applicable referenced agreement. Lessee shall be notified of the Rent
Commencement Date and the serial numbers of the equipment.
14. LEASE TERM. The lease shall be effective when signed by both parties.
The initial Term of the Lease shall expire at the end of the number of Payment
Periods, specified as "Term" in the Supplement, after the Rent Commencement
Date. However, obligations under the Lease shall continue until they have been
performed in full.
15. RATE PROTECTION. Unless modified pursuant to Paragraph 12, the Rent
shall be based on the Lease Rate specified in the Supplement or such greater
Lease Rate as may be specified by written notice to Lessee more than one month
before the estimated Shipment Date of Effective date for Additional License. By
notice to Lessor in writing prior to delivery, or effective date for additional
license and within 15 days after receipt of such notice Lessee may terminate the
Lease for the affected item. Otherwise the Rent shall be adjusted to reflect the
increase. The Unit Purchase Price and LPM Charges are subject to change in
accordance with the referenced agreements.
16. RENT. During the initial Term, Lessee shall pay Lessor, for each
Payment Period. Rent as determined in Paragraph 15. Lessee's obligation to pay
shall begin on the Rent Commencement Date. Rent will be involved in advance as
of the first day of each Payment Period and will be due on the day following the
last day of the first day of a calendar month and/or when the initial Term does
not expire on the last day of a calendar month, the applicable Rent will be
prorated on the basis of 30-day months. Advance Rent, if any, will be applied to
the initial invoice(s).
17. RENEWAL. If Lessee is not then in default under the Lease. Lessee may
renew the Lease one or more times but not beyond six years from the expiration
of the initial Term. Lessor shall offer renewal Terms of one year and may offer
longer Terms if then generally available. For a renewal Term, upon request by
Lessee, at least five months prior to Lease expiration, Lessor shall notify
Lessee, at least four months prior to Lease expiration. Lessor shall notify
Lessee, at least four months prior to expiration, of the Rent any changes to the
Payment Period and due dates, and of any required. Purchase Option or Renewal
Option Percents not specified in the Supplement. The Rent shall be objectively
determined by Lessor by using the projected fair market rental value of the
equipment as of the commencement of such renewal term. However, for option B,
the Rent shall be as specified in the supplement, Lessee may renew for any
renewal term only by so notifying Lessor in writing at least three months before
expiration.
18. PURCHASE OF EQUIPMENT. If Lessee is not then in default under the
lease, Lessee may, upon three months prior written notice to Lessor, purchase
equipment upon expiration of the determined by Lessor by using the projected
fair market sales value of the equipment as of such expiration date plus for
equipment under Option A a recapture of investment tax credit and shall be an
amount determined by multiplying the unit purchase price by the purchase option
percent for such equipment.
If Lessee purchases any equipment, Lessee shall on or before the date of
purchase, pay to Lessor the purchase price, any applicable taxes, all rent due
throughout the date of purchase transfer to Lessee by bill of sale without
recourse or warranty of any kind, express, or implied all of Lessor's right
title and interest in and to such equipment on an "As Is, Where Is" basis except
that Lessor shall warrant title free and clear of all encumbrances.
19. OPTIONAL EXTENSION. If Lessee has not elected to renew or purchase and
as long as Lessee is not in default under the Lease the Lease will be extended
unless Lessee notifies Lessor in writing not less than three months prior to
Lease expiration that Lessee does not want the extension. The extension will be
under the same terms and conditions then in effect including rent (but for
options A or B not unless than fair market rental value and will continue until
the earlier of termination by either party upon three months prior written
notice or six years after expiration of the initial term.
20. INSPECTION; MARKING; FINANCING STATEMENT. Upon request, lessee shall
make the equipment and its maintenance records available for inspection by
Lessor. Lessee shall execute and deliver to Lessor for filing any uniform
Commercial Code financing statements or similar documents Lessor may reasonably
request.
21. EQUIPMENT USE. Lessee agrees that equipment will be operated by
competent, qualified personnel in accordance with applicable operating
instructions, laws and government regulations and that equipment under option A
will be used only for business purposes.
22. MAINTENANCE. Lessee, at its expense, shall keep the equipment in a
suitable environment as specified by IBM and in good condition and working
order, ordinary wear and tear excepted.
23. ALTERATIONS; MODIFICATIONS; PARTS. Lessee may alter or modify the
equipment only upon written notice to Lessor. Any non-IBM alteration is to be
removed and the equipment restored to its normal, unaltered condition at
Lessee's expires prior to its return to Lessor. At Lessee's option, any IBM
field installable upgrade, feature addition or accessory added to any item of
equipment (Modification) may be removed. If removed, the equipment is to be
restored at Lessee's expense to its normal, unmodified condition. If not
removed, such Modification shall upon return of the equipment become such
Modification shall upon return of the equipment, become, without charge, the
property of Lessor free of all encumbrances. Restoration will include
replacement of any parts removed in connection with the installation of an
alteration or modification. Any part installed in connection with warranty or
maintenance service shall be the property of Lessor.
24. LEASES FOR MODIFICATIONS AND ADDITIONS. Lessor will arrange for
leasing of modifications and additions under terms and conditions then generally
in effect, subject to satisfactory credit review. Additions shall be
machines, or LPM Charges for licensed program materials, which are associated
with the equipment. These modifications and additions must be ordered by Lessee
from IBM. Any lease for modifications shall and any lease for additions may
expire at the same time as the lease for the equipment. The rent shall be
determined by Lessor and specified in a Supplement. If Lessee purchases
equipment prior to Lease expiration. Lessee shall simultaneously purchase any
modifications under the Lease.
25. RETURN OF EQUIPMENT. Upon expiration or termination of the Lease for
any item of equipment, or upon deemed by Lessor pursuant to Paragraph 38, Lessee
shall promptly return the Equipment freight prepaid to a location in the
continental United States specified by Lessor. Except for Casualty Loss, Lessee
shall pay any costs and expenses incurred by Lessor to inspect and
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$4/nofolio
qualify the equipment for IBM's maintenance agreement service. Any parts removed
in connection therewith shall become Lessor's property.
26. CASUALTY INSURANCE; LOSS OR DAMAGE. Lessor will maintain at is own
expense, insurance covering loss of or damage to the equipment (but excluding
any modifications not subject to a lease and any non-IBM alterations) with a
$5,000 deductible per incident. If any item of equipment shall be lost, stolen,
destroyed or irreparably damaged by any cause whatsoever (casualty loss) before
the date of installation as defined in the purchase agreement, the lease for
that item shall terminate. If any item of equipment suffers casualty loss, or
shall be otherwise damaged, on or after the date of installation, lessee shall
promptly inform lessor. If lessor determines that the item can be economically
repaired. Lessee shall place the item in good condition and working order and
lessor will reimburse lessee the reasonable cost of such repair less the
deductible. If not so repairable, lessee shall pay lessor the lesser of $5,000
or the fair market value of the equipment immediately prior to the casualty
loss. Upon Lessor's receipt of payment the lease for that item shall terminate.
27. TAXES. Lessee shall promptly reimburse Lessor for, or shall pay
directly if so requested by Lessor as additional rent, all taxes, charges, and
fees imposed or levied by any governmental body or agency upon or in connection
with the purchase, ownership leasing possession, use or relocation of the
equipment or programming or in connection with the financing of LPM charges or
otherwise in connection with the transactions contemplated by the lease
excluding however, all taxes on or measured by the net income of Lessor. Upon
request, Lessee will provide proof of payment. Any other taxes, charges and fees
relating to the licensing possession or use of licensed program materials will
be governed by the license agreement.
28. LESSOR'S PAYMENT. If Lessee fails to perform its obligations under
Paragraph 27 or 31 or to discharge any encumbrances created by Lessee, Lessor
shall have the right to substitute performance, in which case, Lessee shall pay
Lessor the cost thereof.
29. TAX INDEMNIFICATION (APPLIES ONLY FOR EQUIPMENT UNDER OPTIONS A OR B).
The lease is entered into on the basis that under the Internal Revenue Code of
1986, as amended (Code), Lessor shall be entitled to (1) maximum Accelerated
Cost Recovery System (ACRS) deductions for 5-year property and (2) deductions
for interest expense incurred to finance purchase of the equipment. The Bulletin
Lessor's Tax Assumption will be given to Lessee on request.
Lessee represents, warrants and covenants that at all times during the
Lease:
a) no item of equipment will constitute public utility property as defined
in the Code;
b) Lessee will not make any election under the Code or take any action, or
fail to act would cause any item of equipment to cease to be eligible for any
ACRS deductions or interest deductions;
c) Lessee will keep and make available to Lessor the records required to
establish the matters referred to in this paragraph 29; and
d) for equipment located in a United States possession, Lessee represents
that Lessee is a tax exempt entity as defined in the Code.
Furthermore, if Lessee is a tax exempt entity, Lessee covenants that it
will not renew or extend the Lease if such action shall cause Lessor a Tax Loss
as described below.
If, as a result of any act, failure to act, misrepresentation, inaccuracy
or breach of any warranty or covenant or default under the Lease by Lessee, an
affiliate of Lessee, or any person who shall obtain the use of possession of any
item of equipment through Lessee, Lessor shall lose the right to claim or shall
suffer any disallowance or recapture of all or any portion of any ACRS
deductions or interest deductions (tax loss) with respect to any item of
equipment, then, promptly upon written notice to Lessee that a Tax Loss has
occurred, Lessee shall reimburse Lessor that amount determined below.
The reimbursement shall be an amount that, in the reasonable opinion of
Lessor, shall make Lessor's after-tax rate of return and cash flows (Financial
Returns) over the term of the Lease for such item of equipment, equal to the
expected Financial Returns that would have been otherwise available. The
reimbursement shall take into account the effects of any interest, penalties and
additions to taxes required to be paid by Lessor as a result of any payments
pursuant to this paragraph. Financial Returns shall be based on economic and
tax assumptions used by Lessor in entering into the Lease.
All the rights and privileges of Lessor arising from this Paragraph 29
shall survive the expiration of termination of the Lease.
For purposes of determining tax effects under Paragraphs 12, 27, 29, and 30
the term "Lessor" shall include, to the extent of interests, any partner in
Lessor and any affiliated group of corporations and each member thereof, at
which Lessor or any such partner is or shall become a member and with which
Lessor or any such partner joins in the filling of consolidated or combined
returns.
30. GENERAL INDEMNITY. This lease is a net lease. Therefore, Lessee shall
indemnify lessor against and hold Lessor harmless from any and all claims,
actions, damages, obligations, liabilities and liens; and all costs and
expenses, including legal fees, incurred by Lessor in connection therewith
arising out of the Lease including without limitation, the purchase, ownership,
lease, licensing, possession, maintenance, condition, use or return of the
equipment, programming or licensed program materials; or arising by operation of
law; excluding, however, any of the foregoing which result from the sole
negligence or willful misconduct of lessor, Lessee agrees that upon written
notice by lessor of the assertion of any claim, action, damage, obligation,
liability or lien, Lessee shall assume full responsibility for the defense
thereof. Any payment pursuant to this paragraph shall be of such amount as shall
be necessary so that after payment of any taxes required to be paid thereon by
lessor, including taxes on or measured by the net income of Lessor, the balance
will equal the amount due hereunder. Lessee's obligations under this paragraph
shall not constitute a guarantee of the residual value or useful life of any
item of equipment of a guarantee of any debt of Lessor. The provisions of this
paragraph with regard to matters arising during the lease shall survive the
expiration or termination of the Lease.
31. LIABILITY INSURANCE. Lessee shall obtain and maintain comprehensive
general liability insurance in an amount of $1,000,000 or more for each
occurrence with an insurer having a "Best Policyholders" rating of B+ or better.
The policy shall name Lessor as an additional insured as Lessor's interest may
appear and shall contain a clause requiring the insurer to give Lessor at least
one month's prior written notice of the cancellation, or any alteration the
terms, of the policy. Lessee shall furnish to Lessor upon request, evidence
that such insurance coverage is in effect.
32. SUBLEASE AND RELOCATION OF EQUIPMENT; ASSIGNMENT BY LESSEE. Upon
Lessor's prior written consent which will not be unreasonably withheld. Lessee
may sublet the equipment or relocate it from the equipment location. No sublease
or relocation shall relieve Lessee of its obligations under the Lease. In no
event shall Lessee remove the equipment from the United States. Lessee shall not
assign, transfer, or otherwise dispose of the Lease or equipment or any interest
thereof except those created by Lessor .
33. ASSIGNMENT BY LESSOR. Lessee acknowledges and understands that the
terms and conditions of the lease have been fixed to enable Lessor to sell and
assign its interest of grant a security interest or interests in the Lease and
the equipment individually or together, in whole or in part for the purpose of
securing loans to Lessor or otherwise. If Lessee is given written notice of any
assignment, it shall promptly acknowledge receipt thereof in writing. Each such
assignee shall have all of the rights of Lessor under the Lease. Lessee shall
not assert against any such assignee any set-off defense or counterclaim that
lessee may have against Lessor or any other person. Lessor shall not be relieved
of its obligations hereunder as a result of any such assignment unless Lessee
expressly consents thereto.
34. FINANCING. If the Lease provides for financing of LPM Charges, Lessor
will pay such Charges directly to IBM. Any other charges due IBM under the
License Agreement shall be paid directly to IBM by Lessee. Lessee's obligation
to pay rent shall not be affected by any discontinuance, return or destruction
of any license or licensed program materials in accordance with the terms of the
License Agreement prior to the date LPM Charges are due the financing of
affected LPM charges shall be canceled.
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35. FINANCING PREPAYMENT (DOES NOT APPLY FOR ITEMS OF EQUIPMENT). Lessee
may terminate an item of Financing (but not an item of equipment) by prepaying
its remaining rent. Lessee shall provide Lessor with notice of the intended
prepayment date which shall be at least one month after the date of the notice.
Lessor may, depending on market conditions at the time, make an adjustment in
the remaining rent to reflect such prepayment and shall advise Lessee of the
balance to be paid. If, prior to Lease expiration, Lessee purchases the
equipment or if the lease is terminated, Lessee shall at the same time prepay
any related financing including that for programs licensed to the equipment.
36. DELINQUENT PAYMENTS. If any amount to be paid to Lessor is not paid on
or before its due date, lessee shall pay lessor on demand 2% of such late
payment for each month of part thereof from the due date until the date paid or,
if less, the maximum allowed by law.
37. DEFAULT; NO WAIVER. Lessee shall be in default under the lease upon the
occurrence of any of the following events; (a) Lessee fails to pay when due any
amount required to be paid by Lessee under the lease and such failure shall
continue for a period of seven days after the due date; (b) Lessee fails to
perform any other provisions under the lease or violates any of the covenants or
representations made by Lessee in the lease or lessee fails to perform any of
its obligations under any other lease entered into pursuant to this agreement
and such failure or breach shall continue unremedied for a period of 15 days
after written notice is received by Lessee from Lessor; (c) lessee violates any
of the convenants or representations made by lessee in any application for
licensed program materials of fails to perform any provision In any such
agreement (except the obligation to pay the purchase price or LPM Charges); (d)
lessee makes an assignment for the benefit of creditors, whether voluntary or
involuntary, or consents to the appointment of a trustee or receiver or it
either shall be appointed for Lessee or for a substantial part of its property
without its consent; (e) any petition or proceeding if filed by or against
lessee under any Federal or State bankruptcy or insolvency code or similar law;
or (f) if applicable, lessee makes a bulk transfer subject to the provisions of
the Uniform Commercial Code.
Any failure of Lessor to require strict performance by Lessee or any waiver
by Lessor of any provision in the Lease shall not be construed as a consent or
waiver of any other breach of the same or of any other provision.
38. REMEDIES. If lessee is in default under the lease, lessor shall have
the right in its sole discretion to exercise any one of more of the following
remedies in order to protect its interests reasonably expected profits and
economic benefits. Lessor may (a) declare any lease entered into pursuant to
this agreement to be in default (b) terminate in whole or in part any Lease (c)
recover from Lessee any and all amounts then due and to become due (d) take
possession of any or all items of equipment, whenever located, without demand or
notice, without any court order or other process of law; and (e) demand that
Lessee return any or all such terms of equipment to lessor in accordance with
Paragraph 25 and for each day that lessee shall fail to return any item of
equipment, lessor may demand an amount equal to the rent, prorated on the basis
of a 30-day month, in effect immediately prior to such default. Upon
repossession or return of such item or items of equipment, lessor shall sell
lease or otherwise dispose of such item or items in a commercially reasonable
manner, with or without notice and on public or private bid, and apply the net
proceeds thereof towards the amounts due under the lease but only after
deducting (i) in the case of sale the estimated fair market value of such item
or items as of the scheduled expiration of the lease; or (ii) in the case of any
replacement lease, the rent due for any period beyond the scheduled expiration
of the lease for such item or items (iii) in either case, all expenses,
including legal fees, incurred in connection therewith; and (iv) where
appropriate, any amount in accordance with Paragraph 29. Any excess net proceeds
are to be retained by Lessor. Lessor may pursue any other remedy available at
law or in equity, including but not limited to, seeking damages specific
performance and an injunction.
No right or remedy is exclusive of any other provided herein or permitted
by law or equity. All such rights and remedies shall be cumulative and may be
enforced concurrently or individually from time to time.
39. LESSORS' EXPENSE. Lessee shall pay lessor on demand all costs and
expense, including legal and collection fees incurred by lessor in enforcing the
terms conditions or provisions of the lease or in protecting lessor's rights and
interest in the lease and the equipment.
40. OWNERSHIP; PERSONAL PROPERTY; LICENSED PROGRAM MATERIALS. The
equipment under lease is and shall be the property of lessor. Lessee shall have
no right, title, or interest therein except as set forth in the lease. The
Equipment is and shall at all time be and remain personal property and shall not
become a fixture of realty. Licensed program materials are licensed and provided
by IBM directly to lessee under the terms and conditions of the license
agreement.
41. NOTICES; ADMINISTRATION. Service of all notices under the lease shall
be sufficient if delivered personally or mailed to lessee at its address
specified in the supplement. Notice by mail shall be effective when deposited in
the United States mail, duly addressed and with postage prepaid. Notices,
consents and approvals from or by lessor shall be given by lessor or on its
behalf by IBM and all payments shall be made to IBM until lessor shall notify
lessee otherwise.
42. LESSEE REPRESENTATION. If the lease includes financing, lessee
represents that it is (a) a corporation if any item of equipment is located in
Ohio, Mississippi, Virginia, or West Virginia, and/or (b) a business corporation
if any item of equipment is located in Pennsylvania.
43. REVISIONS FOR PREVIOUSLY INSTALLED EQUIPMENT. Equipment installed
with lessee under an IBM lease or rental agreement may be purchased by lessor,
on the Effective Date of Purchase (as defined in the Purchase Agreement) for
lease to lessee under option B or B for such equipment, the lease shall be
revised as follows:
Paragraph 4 and 26 - replace "Estimated Shipment Date" by "Intended
Effective Date of Purchase," replace "delivery," and "Date of Installation" by
"Effective Date of Purchase."
Paragraph 7 - add at the end of the first paragraph, "Assignment" of the
option to purchase installed Equipment at the net purchase option price under an
IBM lease or rental agreement will be permitted only when Lessee submits the
supplement in sufficient time to achieve the intended Effective Date of
Purchase. The Effective Date of Purchase under this assignment shall be the
later of the first day of the Quotation Month of the day on which the applicable
supplement is accepted by lessor. If the Quotation Month expires and the
purchase of Equipment is not concluded, this assignment and lease will be null
and void regarding any such Equipment and all rights, duties and obligations of
lessee and IBM will remain in accordance with the provision of the IBM agreement
under which the Equipment is currently installed.
Paragraph 11 and 12 - delete both paragraphs; and
Paragraph 15 - replace the entire paragraph with the following: "The
Rent shall be based on the Lease Rate specified in the Supplement of such
greater lease rate as may be specified by written notice to lessee more than one
month before the Effective Date of Purchase. The unit Purchase Price is subject
to change in accordance with the referenced Purchase Agreement. Lessee any
terminate the Lease for any item subject to an increase by giving lessor written
notice on or before the effective date of purchase."
44. APPLICABLE LAW: SEVERABILITY. The Lease shall be governed by the laws
of the State of Connecticut. If any provision shall be held to be invalid or
unenforceable the validity and enforceability of the remaining provision shall
not in any way be affected or impaired.
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IBM CREDIT CORPORATION Stamford, CT 06904
TERM LEASE MASTER AGREEMENT
Agreement No.: 7336742
Enterprise No.: 7336742
AGREEMENT COVERAGE PAGE
List below all entities affiliated with Lessee that may execute Supplements and
be deemed bound to this Agreement:
Entity Legal Name Address (if not all locations)
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
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