UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
Mark one
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended OCTOBER 31, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
[LOGO]
OPTICAL COATING LABORATORY, INC.
(Exact name of registrant as specified in its charter)
COMMISSION FILE NUMBER 0-2537
DELAWARE 68-0164244
(State or other jurisdiction of incorporation or organization)(IRS
Identification No.)
2789 NORTHPOINT PARKWAY, SANTA ROSA CALIFORNIA 95407-7397
(Address of principal executive offices) (Zip code)
1
Registrant's telephone number, including area code: (707) 545-6440
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
COMMON STOCK, $.01 PAR VALUE
(Title of each class)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [O] Yes [ ] No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [O]
At December 31, 1996, the aggregate market value of the registrant's common
stock (based upon the closing price of these shares on the NASDAQ National
Market System) held by non-affiliates, which excludes shares held by officers
and directors and the Employee Stock Ownership Plan of the registrant (not all
of whom claim to be affiliates), was approximately $86.7 million.
At December 31, 1996, there were 9,787,330 shares of the registrant's common
stock, $.01 par value, issued and outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
2
Portions of the definitive Proxy Statement for the Company's Annual Meeting of
Stockholders to be held March 18, 1997 are incorporated by reference into Part
III of this Form 10-K.
The Exhibit index appears on Pages 42-45.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
None
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
ITEM 11. EXECUTIVE COMPENSATION
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Pursuant to Paragraph G(3) of the General Instructions to Form 10-K, the
information called for in Part III, Items 10, 11, 12 and 13 of Form 10-K is
omitted since the Company will file with the Securities and Exchange Commission,
not later than 120 days after the close of the fiscal year ended October 31,
1996, a definitive proxy statement pursuant to Regulation 14A in connection with
its 1997 Annual Meeting of Stockholders. The information contained under the
caption "Executive Officers of the Registrant" in Part I of this Form 10-K is
incorporated by reference into Item 10.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(A) 1. CONSOLIDATED FINANCIAL STATEMENTS:
3
The following consolidated financial statements are included in Item
8:
PAGE(S)
Independent Auditors' Report................................22
Consolidated Balance Sheets.................................23
Consolidated Statements of Income...........................24
Consolidated Statements of Cash Flows....................25-26
Consolidated Statements of Common Stockholders' Equity .....27
Notes to Consolidated Financial Statements..................28
Supplemental Financial Information.......................40-41
(A) 2. FINANCIAL STATEMENT SCHEDULES
The following consolidated financial statement schedules
are included in Item 14(d):
Schedule II - Valuation and Qualifying accounts.........46
All other schedules have been omitted since the required information is not
present or not present in amounts sufficient to require submission of the
schedule, or because the information required is included in the consolidated
financial statements or the accompanying notes.
(A) 3. LISTING OF EXHIBITS
The following are filed as Exhibits to this Annual Report on Form 10-K. The
numbers refer to the Exhibit Table of Item 601 of Regulation S-K.
Exhibit
No. Description
4
3.1 Restated Certificate of Incorporation. Incorporated by reference to
Exhibit (4)(a) of the Registrant's Form 10-Q for the quarter ended July
31, 1988.
3.2 By-Laws. Incorporated by reference to Exhibit (3)(b) of the Registrant's
Form 8-K under Item 5 dated November 20, 1987.
4.1 Rights Agreement between Registrant and First Interstate Bank of
California dated November 25, 1987. Incorporated by reference to Exhibit
(4) of the Registrant's Form 10-K for the year ended October 31, 1987.
4.2 Note Purchase Agreement(s) dated as of May 27, 1994 for the private
placement of $18,000,000 of 8.71% Senior Notes due June 1, 2002 between
the Registrant and Connecticut Mutual Life Insurance Company, Modern
Woodman of America and American Life and Casualty Insurance Company.
Incorporated by reference to Exhibit (4)(a) of the Registrant's Form 10-Q
for the quarter ended July 31, 1994.
4.3 Stock Purchase Agreement dated as of February 8, 1995 by and between
the Registrant, Netra Corporation and the Sellers as identified on
the signature page of said agreement, each a shareholder of Netra
Corporation, for the purchase by the Registrant of all of the shares of
common and preferred stock of Netra Corporation. Incorporated by
reference to Exhibit (4) of the Registrant's Form 10-Q for the quarter
ended April 30, 1995.
4.4 Optical Coating Laboratory, Inc. 12,000 shares of 8% Series C Convertible
Redeemable Preferred Stock Purchase Agreement among the Registrant and
the investors named therein dated as of May 1, 1995. Incorporated by
reference to Exhibit 4(e) of Registrant's Form S-8 dated July 6, 1995.
4.5 Certificate of Designation, Preferences and Rights of Series C
Convertible Redeemable Preferred Stock of Optical Coating Laboratory,
5
Inc. dated May 2, 1995. Incorporated by reference to Exhibit 4(f) of
Registrant's Form S-8 dated July 6, 1995.
4.6 Credit Agreement dated as of May 24, 1995 among the Registrant, Bank of
America NT&SA as agent, and Letter of Credit Issuing Bank and the other
Financial Institutions party thereto arranged by BA Securities, Inc.
Incorporated by reference to Exhibit (4)(a) of the Registrant's Form 10-Q
for the quarter ended July 31, 1995.
4.7 Second Amended and Restated Credit Agreement dated as of May 24, 1995
between Optical Coating Laboratory, Inc. and Bank of America NT&SA.
Incorporated by reference to Exhibit (4)(b) of the Registrant's Form 10-Q
for the quarter ended July 31, 1995.
4.8 Secured Promissory Note between Optical Coating Laboratory, Inc. and Aid
Association for Lutherans dated November 8, 1995. Incorporated by
reference to Exhibit 4.8 of the Registrant's Form 10-K for the year ended
October 31, 1995.
4.9 First Amendment to Credit Agreement dated as of May 24, 1995 between
Optical Coating Laboratory, Inc., Bank of America, NT&SA, as agent for
itself and the Banks, and the several financial institutions party to the
Credit Agreement, which amendment is dated as of December 15, 1995.
Incorporated by reference to Exhibit 4.9 of the Registrant's Form 10-K
for the year ended October 31, 1995.
Exhibit
No. Description
4.10* Capital Equipment Lease Agreement dated as of February 20, 1996 between
6
Optical Coating Laboratory, Inc. and Fleet Credit Corporation.
4.11* Capital Equipment Lease Agreement dated as of June 19, 1996 between Flex
Products, Inc. and Fleet Credit Corporation.
9 Not applicable.
10.0 Registrant's Employee Stock Ownership Plan (OCLI ESOP+), as amended.
Incorporated by reference to Exhibit (10)(c) of the Registrant's Form 10-
K for the year ended October 31, 1988.
10.1 Registrant's 1996 Incentive Compensation Plan. Incorporated by reference
to Exhibit A of the Registrant's Proxy Statement dated March 8, 1996.(1)
10.2 Registrant's 1995 Incentive Compensation Plan. Incorporated by reference
to Exhibit A of the Registrant's Proxy Statement dated March 10, 1995.(1)
10.3 Registrant's 1993 Incentive Compensation Plan. Incorporated by reference
to Exhibit A of the Registrant's Proxy Statement dated March 8, 1993.(1)
10.4 Registrant's 1992 Incentive Compensation Plan. Incorporated by reference
to Exhibit A of the Registrant's Proxy Statement dated March 8, 1992.
(1)
10.5 Registrant's 1991 Incentive Compensation Plan. Incorporated by reference
to Exhibit A of the Registrant's Proxy Statement dated February 25,
1991. (1)
10.6 Registrant's 1987 Incentive Compensation Plan. Incorporated by reference
to Exhibit A of the Registrant's Proxy Statement dated February 19, 1987.
(1)
7
10.7 Registrant's 1984 Incentive Stock Option Plan. Incorporated by reference
to Exhibit (10)(d) of the Registrant's Form 10-K for the year ended
October 31, 1985. (1)
10.8 Registrant's 1983 Incentive Stock Option Plan. Incorporated by reference
to Exhibit (10)(d) of the Registrant's Form 10-K for the year ended
October 31, 1983. (1)
10.9 Registrant's 1982 Incentive Stock Option Plan. Incorporated by reference
to Exhibit A of Proxy Statement of Registrant dated March 1, 1982. (1)
10.10 Registrant's Directors' and Officers' Liability and Corporate
Reimbursement Insurance Policy. Incorporated by reference to Exhibit
(10)(i) of the Registrant's Form 10-K for the year ended October 31,
1987. (1)
10.11 Form of Directors' and Officers' Indemnification Agreement. Incorporated
by reference to Exhibit (10)(j) of the Registrant's Form 10-K for the
year ended October 31, 1987. (1)
10.12 Employment Agreements between Registrant and its Executive Officers.
Incorporated by reference to Exhibit (10)(k) of the Registrant's Form 10-
K for the year ended October 31, 1987. Second Amendment thereto
incorporated by reference to Exhibit (28)(a) of the Registrant's Form 10-
Q for the quarter ended January 31, 1992. Third Amendment thereto
incorporated by reference to Exhibit 10.13 of the Registrant's Form 10-K
for the year ended October 31, 1993. (1)
10.13 Form of Fourth Amendment to Employment Agreements between Registrant and
its Executive Officers dated November 20, 1995. Incorporated by reference
to Exhibit 10.12 of the Registrant's Form 10-K for the year ended October
8
31, 1995. (1)
Exhibit
No. Description
10.14 Form of Employment Assurance Agreements between Registrant and its key
technical and professional employees. Incorporated by reference to
Exhibit (10)(l) of the Registrant's Form 10-K for the year ended October
31, 1987. Form of Amendment thereto incorporated by reference to Exhibit
(28)(b) of the Registrant's Form 10-Q for the quarter ended January 31,
1992. (1)
10.15 Form of Amendment to Employment Assurance Agreements between Registrant
and its key technical and professional employees dated November 20, 1995.
Incorporated by reference to Exhibit 10.14 of the Registrant's Form 10-K
for the year ended October 31, 1995.(1)
10.16 Mortgage Agreement between the Scottish Development Agency and
Registrant's Scottish Subsidiary. Incorporated by reference to Exhibit
(10)(o) of the Registrant's Form 10-K for the year ended October 31,
1987.
10.17 Acquisition Agreement between Henning Von Birkhahn and Ingo Mertens and
the Registrant's German subsidiary, OCLI Optical Coating Laboratory GmbH,
dated December 31, 1992 for the acquisition by the Registrant of MMG
Minnahutte Maschinelle Glasbearbeitung GmbH. Incorporated by reference to
Exhibit 2A of Registrant's Form 8-K dated December 31, 1992.
10.18 Stock and Note Purchase Agreement by and among OCLI, SICPA Holdings S.A.,
ICIA, ICIAH and Flex Products, Inc. Incorporated by reference to the
9
Registrant's Form 8-K dated May 23, 1995 and Registrant's Form 8-K/A
dated April 11, 1996.
10.19 Employment Agreement Letter between John McCullough and the Registrant
dated October 31, 1995. Incorporated by reference to Exhib
10.20 1997 Management Incentive Plan (1)
11 Computation of earnings (loss) per share for the years ended October 31,
1996, 1995 and 1994.
12 Not applicable
13 Not applicable
16 Not applicable
18 Not applicable
21 Subsidiaries of the Registrant
22 Not applicable
23 Independent Auditors' Consent and Report on Schedules
24 Not applicable
27 Financial Data Schedule
28 Not applicable
99 Not applicable
* Items not previously filed are designated by an asterisk.
(1) Designates management contracts or compensatory plan arrangements
required to be filed as exhibits pursuant to Item 14(c) of Form 10-K.
(b) REPORTS ON FORM 8-K
None
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
10
behalf by the undersigned, thereunto duly authorized.
DATE: May 23, 1997 OPTICAL COATING LABORATORY, INC.
By: JOSEPH C. ZILS
Joseph C. Zils
Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:
SIGNATURE TITLE DATE
Chairman of the Board, President,
Chief Executive Officer
(Principal Executive and
HERBERT M. DWIGHT, JR. Operating Officer) May 23, 1997
Herbert M. Dwight, Jr.
JOHN MCCULLOUGH Director and Vice President May 23, 1997
John McCullough
Vice President, General Counsel,
Corporate Secretary
and Chief Financial Officer
JOSEPH C. ZILS (Principal Financial Officer) May 23, 1997
DOUGLAS C. CHANCE Director May 23, 1997
Douglas C. Chance
SHOEI KATAOKA Director May 23, 1997
Shoei Kataoka
JULIAN SCHROEDER Director May 23, 1997
Julian Schroeder
RENN ZAPHIROPOULOS Director May 23, 1997
Renn Zaphiropoulos
12
[LOGO]
Fleet Credit Corporation
February 20, 1996
Mr. Jeff Ryan
OPTICAL COATING LABORATORY, INC.
2789 Northpoint Parkway
Santa Rosa, California 95407-7397
RE: Account No. 32053-02
Dear Mr. Ryan:
I would like to take this opportunity to thank you for working with Fleet Credit
Corporation on your recent financing requirements.
Enclosed, for your files, are original copies of the executed documents
referencing the above account number. Invoices will be mailed to the address on
this letter. Please verify this. If invoices should be mailed to another address
or another individual within your organization, please contact our Customer
Service Department at (800) 238-3737.
Again, thank you for your business. Please feel free to call us if you have
questions regarding your account or if we can be of any further service to you.
Very truly yours,
Jeanette R. Fernandes
Contract Administrator I
enclosures
Fleet Credit Corporation 5th Floor, 50 Kennedy Plaza, Providence, RI 02903-2305
401-278-5593
A Member of Fleet Financial Group, Inc.
<PAGE>
Jeffrey M. Ryan Optical Coating
Assistant Treasurer Laboratory, Inc.
2789 Northpoint Parkway
Santa Rosa, California
95407-7397
(707) 525-7656
FAX 707/525-7410
February 13, 1996 DUPLICATE
---------
John Gould PLEASE SIGN BOTH SETS AND
Vice President RETURN THE DUPLICATE FOR OUR
Fleet Credit Corporation FILES. THANK YOU.
5th Floor
50 Kennedy Plaza
Providence, RI 02903-2305
Re: $10,000,000 Lease Line
Dear John:
Please find enclosed the signed documentation relating to the second transaction
against the subject lease line. The amount of the transaction is $1,000,000. I
would kindly ask that after a Fleet representative signs the documentation on
behalf of Fleet that a copy of this transaction documentation be sent to my
attention at the address on this letterhead.
Thanks and regards,
/s/ Jeff
<PAGE>
CLOSING CHECKLIST
TO: Mr. Jeff Ryan
RE: OPTICAL COATING LABORATORY, INC. ACCOUNT NUMBER: 32053-02
MASTER DOCUMENTS LEASE DOCUMENTS
- ----------------------------------------- ------------------------------------
___ CERTIFIED COPY OF RESOLUTIONS ___ LEASE SCHEDULE
- ----------------------------------------- ------------------------------------
___ MASTER EQUIPMENT LEASE AGREEMENT _X_ TRUE LEASE SCHEDULE
- ----------------------------------------- ------------------------------------
___ MASTER SECURTY AGREEMENT _X_ SCHEDULE A W/ SCHEDULE A-1
- ----------------------------------------- ------------------------------------
___ GUARANTY _X_ ACCEPTANCE CERTIFICATE
- ----------------------------------------- ------------------------------------
___ ADD'L SECURITY AGREE. (w/ UCC-1) _X_ WARRANTY BILL OF SALE
- ----------------------------------------- ------------------------------------
___ MAINTENANCE AND RETURN RIDER _X_ PURCHASE OPTION RIDER (2)
- -----------------------------------------
___ ADDENDUM (To:___________________ (Specify: FMV/CAP/RET FEE
- ----------------------------------------- ------------------------------------
_X_ EARLY PURCHASE OPTION RIDER (2)
LOAN DOCUMENTS ------------------------------------
- ----------------------------------------- _X_ STIPULATED LOSS VALUE SCHEDULE
___ SECURED PROMISSORY NOTE ------------------------------------
- ----------------------------------------- _X_ UCC-1 FINANCING STATEMENT(s)(2)
___ FIXED RATE _X_ PAY PROCEEDS LETTER
- ----------------------------------------- ------------------------------------
___ FLOATING RATE ___ INVOICE ($_______________)
- ----------------------------------------- ------------------------------------
___ NOTE ACCEPTANCE CERTIFICATE
- ----------------------------------------- SPECIAL DOCUMENTS
___ SCHEDULE A ___ EQUIPMENT INSPECTION
- ----------------------------------------- ___ UCC SEARCHES/WAIVERS
___ CERTIFICATE OF INSURANCE
- ----------------------------------------- --- --------------------------------
___ UCC-1 FINANCING STATEMENT(s) --- --------------------------------
- ----------------------------------------- --- --------------------------------
___ DISBURSEMENT --- --------------------------------
- ----------------------------------------- --- --------------------------------
___ INVOICE ($_______________) --- --------------------------------
- ----------------------------------------- --- --------------------------------
CONDITIONS PRECEDENT TO FUNDING:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
JEANETTE R. FERNANDES 2/8/96
- ------------------------------------ --------------------
CA's INITIALS DATED
<PAGE>
[LOGO] LEASE SCHEDULE NO. 32053-00002
(True Lease Schedule)
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
Lessee: OPTICAL COATING LABORATORY, INC.
Address: 2789 NORTH POINT PARKWAY
SANTA ROSA, CA 95407
1. This Lease Schedule No. 32053-00002 dated as of FEBRUARY 08,
1996 is entered into pursuant to and incorporates by this reference, all of the
terms and provisions of that certain Master Equipment Lease Agreement No. 32053
dated as of DECEMBER 19, 1995 (the "Master Lease"), for the lease of the
Equipment described in Schedule A attached hereto. This Lease Schedule shall
constitute a separate, distinct and independent lease of the Equipment and the
contractual obligation of Lessee. References to the "the Lease" or "this Lease"
shall mean and refer to this Lease Schedule, together with the Master Lease and
all exhibits, addenda, schedules, certificates, riders and other documents and
instruments executed and delivered in connection with this Lease Schedule, all
as the same may be amended or modified from time to time. All capitalized terms
used herein and not defined herein shall have the meanings set forth or referred
to in the Master Lease. By its execution and delivery of this Lease Schedule,
Lessee hereby reaffirms all of the representations, warranties and covenants
contained in the Master Lease, as of the date hereof, and further represents and
warrants to Lessor that no Event of Default, and no event or condition which
with notice or the passage of time or both would constitute an Event of Default,
has occurred and is continuing as of the date hereof.
2. ACQUISITION COST. The Acquisition Cost of the Equipment is: $1,000,000.0O.
3. (a) LEASE TERM. The Lease Term shall commence on the date
hereof and shall continue for a period of 71 months after the Lease Term
Commencement Date set forth in the Acceptance Certificate to this Lease
Schedule, plus any renewal or extended term applicable in accordance with the
terms of the Lease.
(b) RENTAL PAYMENTS. In addition to interim rent payable
pursuant to Section 2 of the Master Lease, Lessee shall pay Lessor 71
consecutive Rental Payments in the amounts set forth in the schedule below, plus
any applicable sales/use taxes, commencing on the Rental Payment Commencement
Date set forth in the Acceptance Certificate and MONTHLY thereafter for the
remaining Lease Term. Each Rental Payment shall be payable on the same day of
the month as the Rental Payment Date in each succeeding rental period during the
remaining Lease Term (each, a "Rental Payment Date")'
Amount of Each
Number of Rental Payments Rental Payment
------------------------- ---------------
35 13,188.97
36 16,119.86
(c) ADVANCE RENTAL PAYMENT. Lessee agrees to pay Lessor the
first 01 and last O Rental Payments, due and payable on the Acceptance Date.
(d) SECURITY DEPOSIT. Lessee agrees to make a payment in an
amount equal to 0% of the Acquisition Cost of the Equipment, due and payable on
the Acceptance Date, to be held by Lessor as a non-interest bearing deposit to
secure Lessee's performance under the Lease.
<PAGE>
[LOGO] WARRANTY BILL OF SALE
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903
OPTICAL COATING LABORATORY, INC. ("Seller") of 2789 NORTH POINT
PARKWAY, SANTA ROSA, CA 95407, in consideration of the sum of $1,000,000.00
Dollars, and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, does hereby sell, transfer and assign to Fleet
Credit Corporation ("FCC") a Rhode Island corporation having its principal
office at 50 Kennedy Plaza, Providence, Rhode Island 02903, the equipment set
forth in Schedule A hereto (the "Equipment").
Seller hereby covenants with and warrants to FCC that Seller is the
lawful owner of the Equipment and has the right to sell the Equipment, and that
the Equipment is free and clear of all rights, claims, liens, charges, security
interests or encumbrances of any other person. Seller will forever indemnify,
defend and warrant all of the rights of FCC in and to the Equipment transferred
hereunder against the claims and demands of all other persons.
IN WITNESS WHEREOF, Seller has duly executed this Bill of Sale this 13th day of
February, 1996.
OPTICAL COATING LABORATORY, INC.
By: /s/ John M. Markovich
------------------------------
Name: John M. Markovich
----------------------------
Title: Vice President Finance and
---------------------------
Chief Financial Officer
State of CALIFORNIA
--------------------
County of SONOMA
--------------------
Subcribed and sworn before me this 13th day of February, 1996.
/s/ Silvia C. Hogan
----------------------------------------
Notary Public
My Commission expires: November 11, 1997
------------------
(SEAL)
===============================
SILVIA C. HOGAN
COMM. #1009258
Notary Public--California
SONOMA COUNTY
My Comm. Expires NOV 11, 1997
===============================
<PAGE>
FLEET CREDIT CORPORATION
EARLY PURCHASE OPTION RIDER
(single option)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Early Purchase Option Rider (the "Rider") is attached to and made a
part of that certain Lease Schedule No. 32053-01, dated as of December 19, 1995
(the "Lease Schedule"), by and between the undersigned parties.
So long as no Event of Default has occurred and is continuing under the
Lease, and upon at least 90 days prior written notice to Lessor, Lessee shall
have the right to terminate the Lease Term for all but not less than all of the
Equipment on the Rental Payment Date for Rental Payment Number 60 (the
"Termination Date"). Lessee shall pay to Lessor on the Termination Date an
amount equal to: (a) all Rental Payments, late charges and other amounts due and
owing under the Lease; plus (b) all taxes, assessments and other charges due or
payable in connection with the sale of the Equipment to Lessee; plus, (c) 43%
of the Acquisition Cost of the Equipment. If Lessee elects to exercise its
option under the terms of this Rider, it shall automatically be deemed that
Lessee has exercised its purchase option under and pursuant to the terms of the
Early Purchase Option Rider dated February 8, 1996 under that certain Lease
Schedule No. 32053-02 dated February 8, 1996.
Provided that Lessor shall have received (a) all amounts payable
hereunder and (b) all amounts payable under the Early Purchase Option Rider
applicable to Lease Schedule No. 32053-02 on the Termination Date, and that no
Event of Default then exists and is continuing under the Lease, Lessor shall
convey all of its right, title and interest in and to the Equipment to Lessee on
the Termination Date, on an "AS-IS", "WHERE-IS" BASIS WITHOUT REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, and without recourse to Lessor, except that the
Equipment shall be free and clear of all liens created by Lessor.
In the event Lessee shall not pay all amounts due hereunder on the
Termination Date, then the Lease Term for the Equipment shall continue in full
force and effect, and this Rider shall be null and void and of no further force
and effect.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: December 19, 1995.
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
50 Kennedy Plaza
Providence, RI 02903-2305
1-800-238-3737
OPTICAL COATING LABORATORY, IN
2789 NORTH POINT PARKWAY
SANTA ROSA CA 95407-0000
February 13, 1996
- --------------------------------------------------------------------------------
DESCRIPTION AMOUNT
- --------------------------------------------------------------------------------
ADVANCE PAYMENT $13,188.97 +
TRANSACTION EXPENSES $ 1,000.00 +
SH FUND $14,188.97 -
Total Due $14,188.97
Total Received $14,188.97
Balance $0.00
- --------------------------------------------------------------------------------
RETURN YOUR REMITTANCE TO THE ATTENTION OF: JEANETTE FERNANDES
TO INSURE PROPER CREDIT TO YOUR ACCOUNT, PLEASE RETURN REMITTANCE COPY.
A Subsidiary of Fleet National Bank
32053 00 002 00002
<PAGE>
[LOGO] PAY PROCEEDS LETTER
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
We hereby authorize you to pay the following Payee(s) from the proceeds of
your financial accommodations to us in respect of that certain True Lease
Schedule No. 32053-00002 dated as of FEBRUARY 08, 1996, and make disbursements
directly to said Payee(s) as follows:
Amount of
PAYEE Payment
OPTICAL COATING LABORATORY, INC. $ 985,811.03
- ------------------------------------------ -------------------------
FLEET CREDIT CORPORATION (short fund) $ 14,188.97
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
TOTAL: $ 1,000,000.00
--------------------
Dated as of: FEBRUARY 08, 1996
OPTICAL COATING LABORATORY, INC.
By: /s/ John M. Markovich
------------------------------
Name: John M. Markovich
----------------------------
Title: Vice President Finance and
---------------------------
Chief Financial Officer
<PAGE>
<TABLE>
<CAPTION>
This FINANCING STATEMENT is presented for filing and will remain effective with certain
exceptions for a period of five years from the date of filing pursuant to section 9403 of the
California Uniform Commercial Code.
- ------------------------------------------------------------------------------------------------
<C> <C>
1. DEBTOR (LAST NAME FIRST--IF AN INDIVIDUAL) 1A. SOCIAL SECURITY OR FEDERAL TAX NO.
OPTICAL COATING LABORATORY. INC. 08-0164244
- ------------------------------------------------------------------------------------------------
1B. MAILING ADDRESS 1C. CITY, STATE 1D. ZIP CODE
2789 Northpoint Parkway Santa Rosa, California 95407
- ------------------------------------------------------------------------------------------------
2. ADDITIONAL DEBTOR (IF ANY) 2A. SOCIAL SECURITY OR FEDERAL TAX NO.
(LAST NAME FIRST--IF AN INDIVIDUAL)
- ------------------------------------------------------------------------------------------------
2B. MAILING ADDRESS 2C. CITY, STATE 2D. ZIP CODE
- ------------------------------------------------------------------------------------------------
3. DEBTOR'S TRADE NAMES OR STYLES (IF ANY) 3A. FEDERAL TAX NUMBER
================================================================================================
4. SECURED PARTY 4A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME FLEET CREDIT CORPORATION
MAILING ADDRESS 50 Kennedy Plaza, 5th Floor
CITY Providence STATE RI ZIP CODE 02903
- ------------------------------------------------------------------------------------------------
5. ASSIGNEE OF SECURED PARTY (IF ANY) 5A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME
MAILING ADDRESS
CITY
- ------------------------------------------------------------------------------------------------
6. This FINANCING STATEMENT covers the following types or items of property (include description
of real property on which located and owner of record when required by instruction 4).
(1) Robot Seaming, (2) Robot FSM Seamers and a Conveyor System as set forth on attached
Schedule A, and all additions, accessions, modifications, improvements, replacements,
substitutions and accessories thereto and therefor, whether now owned or hereafter acquired,
and the proceeds of any of the foregoing, including insurance proceeds. Debtor has possession
of the equipment under a True Lease only. Secured Party has a security interest in the
equipment to the extent necessary to protect its title and interest therein. Pursuant to the
Master Equipment Lease Agreement dated December 19, 1995, Debtor has the option to purchase
the subject equipment at the end of the lease term.
Acct#32053-02/jrf
File: Secretary of State/California FIXTURE FILING
- ------------------------------------------------------------------------------------------------
7. CHECK [X] 7A. [ ] PRODUCTS OF COLLATERAL 7B. DEBTOR(S) SIGNATURE NOT REQUIRED IN
IF APPLICABLE ARE ALSO COVERED ACCORDANCE WITH INSTRUCTION 5(a) ITEM:
[ ](1) [ ](2) [ ](3) [ ](4)
- ------------------------------------------------------------------------------------------------
8. CHECK [X] [ ] DEBTOR IS A "TRANSMITTING UTILITY"
IF APPLICABLE IN ACCORDANCE WITH UCC SS. 9105 (1)(n)
- ------------------------------------------------------------------------------------------------
9. DATE: C 10. THIS SPACE FOR USE OF FILING OFFICER
O (DATE, TIME, FILE NUMBER
/s/ John M. Markovich 2/13/96 D AND FILING OFFICER)
SIGNATURE(S) OF DEBTOR(S) E
- -------------------------------------------------- ---
OPTICAL COATING LABORATORY, INC. 1
TYPE OR PRINT NAME(S) OF DEBTOR(S) 2
- --------------------------------------------------
3
/s/ Jeanette R. Fernandes
SIGNATURE(S) OF SECURED PARTY(IES) 4
- --------------------------------------------------
FLEET CREDIT C0RPORATION 5
TYPE OR PRINT NAME(S) OF SECURED PARTY(IES) 6
==================================================
11. Return copy to: 7
NAME 8
ADDRESS
CITY 9
STATE
ZIP CODE 0
==================================================
FORM UCC.1--
Approved by the Secretary of State
==================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
This FINANCING STATEMENT is presented for filing and will remain effective with certain
exceptions for a period of five years from the date of filing pursuant to section 9403 of the
California Uniform Commercial Code.
- ------------------------------------------------------------------------------------------------
<C> <C>
1. DEBTOR (LAST NAME FIRST--IF AN INDIVIDUAL) 1A. SOCIAL SECURITY OR FEDERAL TAX NO.
OPTICAL COATING LABORATORY. INC. 08-0164244
- ------------------------------------------------------------------------------------------------
1B. MAILING ADDRESS 1C. CITY, STATE 1D. ZIP CODE
2789 Northpoint Parkway Santa Rosa, California 95407
- ------------------------------------------------------------------------------------------------
2. ADDITIONAL DEBTOR (IF ANY) 2A. SOCIAL SECURITY OR FEDERAL TAX NO.
(LAST NAME FIRST--IF AN INDIVIDUAL)
- ------------------------------------------------------------------------------------------------
2B. MAILING ADDRESS 2C. CITY, STATE 2D. ZIP CODE
- ------------------------------------------------------------------------------------------------
3. DEBTOR'S TRADE NAMES OR STYLES (IF ANY) 3A. FEDERAL TAX NUMBER
================================================================================================
4. SECURED PARTY 4A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME FLEET CREDIT CORPORATION
MAILING ADDRESS 50 Kennedy Plaza, 5th Floor
CITY Providence STATE RI ZIP CODE 02903
- ------------------------------------------------------------------------------------------------
5. ASSIGNEE OF SECURED PARTY (IF ANY) 5A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME
MAILING ADDRESS
CITY
- ------------------------------------------------------------------------------------------------
6. This FINANCING STATEMENT covers the following types or items of property (include description
of real property on which located and owner of record when required by instruction 4).
(1) Robot Seaming, (2) Robot FSM Seamers and a Conveyor System as set forth on attached
Schedule A, and all additions, accessions, modifications, improvements, replacements,
substitutions and accessories thereto and therefor, whether now owned or hereafter acquired,
and the proceeds of any of the foregoing, including insurance proceeds. Debtor has possession
of the equipment under a True Lease only. Secured Party has a security interest in the
equipment to the extent necessary to protect its title and interest therein. Pursuant to the
Master Equipment Lease Agreement dated December 19, 1995, Debtor has the option to purchase
the subject equipment at the end of the lease term.
Acct#32053-02/jrf
File: Secretary of State/California FIXTURE FILING
- ------------------------------------------------------------------------------------------------
7. CHECK [X] 7A. [ ] PRODUCTS OF COLLATERAL 7B. DEBTOR(S) SIGNATURE NOT REQUIRED IN
IF APPLICABLE ARE ALSO COVERED ACCORDANCE WITH INSTRUCTION 5(a) ITEM:
[ ](1) [ ](2) [ ](3) [ ](4)
- ------------------------------------------------------------------------------------------------
8. CHECK [X] [ ] DEBTOR IS A "TRANSMITTING UTILITY"
IF APPLICABLE IN ACCORDANCE WITH UCC SS. 9105 (1)(n)
- ------------------------------------------------------------------------------------------------
9. DATE: C 10. THIS SPACE FOR USE OF FILING OFFICER
O (DATE, TIME, FILE NUMBER
/s/ John M. Markovich 2/13/96 D AND FILING OFFICER)
SIGNATURE(S) OF DEBTOR(S) E
- -------------------------------------------------- ---
OPTICAL COATING LABORATORY, INC. 1
TYPE OR PRINT NAME(S) OF DEBTOR(S) 2
- --------------------------------------------------
3
/s/ Jeanette R. Fernandes
SIGNATURE(S) OF SECURED PARTY(IES) 4
- --------------------------------------------------
FLEET CREDIT C0RPORATION 5
TYPE OR PRINT NAME(S) OF SECURED PARTY(IES) 6
==================================================
11. Return copy to: 7
NAME 8
ADDRESS
CITY 9
STATE
ZIP CODE 0
==================================================
FORM UCC.1--
Approved by the Secretary of State
==================================================
</TABLE>
<PAGE>
FLEET CREDIT CORPORATION
PURCHASE OPTION RIDER
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (the "Rider") is attached to and made a part
of that certain Lease Schedule No. 32053-02, dated as of February 8, 1996 (the
"Lease Schedule"), by and between the undersigned parties.
1. Purchase Option. If no Event of Default (or event or condition
which, with the passage of time or giving of notice, or both, would become such
an Event of Default) shall have occurred and be continuing, and the Lease shall
not have been earlier terminated, Lessee shall have the option to purchase (the
"Purchase Option") all, but not less than all, of the Equipment at the
expiration of the Lease Term for an amount, payable in immediately available
funds on the last day of the Lease Term, equal to: (a) all Rental Payments, late
charges and other amounts due and owing under the Lease; plus (b) all taxes,
assessments and other charges due or payable in connection with the sale of the
Equipment to Lessee; plus, (c) the Purchase Option Price (hereinafter defined).
If Lessee elects to exercise its option under the terms of this Rider, it shall
automatically be deemed that Lessee has exercised the purchase option under and
pursuant to the terms of that certain Purchase Option Rider to Lease Schedule
No. 32053-01 dated December 19, 1995.
Provided that Lessor shall have received (a) all amounts payable
hereunder and (b) all amounts payable under the Purchase Option Rider applicable
to Lease Schedule No 32053-01 on the last day of the Lease Term, and that no
Event of Default then exists and is continuing under the Lease, Lessor shall
convey all of its right, title and interest in and to the Equipment to Lessee on
the last day of the Lease Term, on an "AS-IS", "WHERE-IS" BASIS WITHOUT
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, and without recourse to Lessor,
except that the Equipment shall be free and clear of all liens created by
Lessor. If Lessee intends to exercise the Purchase Option, Lessee shall give
irrevocable written notice to Lessor (the "Option Notice") not more than 240
days, nor less than 180 days, prior to the expiration of the Lease Term. If
Lessee fails to give such written notice to Lessor, it shall be conclusively
presumed that Lessee has elected not to exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 3% of the Acquisition Cost of the Equipment.
2. Purchase Option Price. If Lessee has elected to exercise the
Purchase Option, then the "Purchase Option Price" shall be the Fair Market Value
(hereinafter defined) of the Equipment, provided, however, that the Purchase
Option Price shall not exceed 30% of the Acquisition Cost of the Equipment. As
soon as practicable following Lessor's receipt of the Option Notice, Lessor and
Lessee shall agree on the Fair Market Value of the Equipment as of the end of
the Lease Term. "Fair Market Value" of the Equipment shall be the amount
determined on the basis of, and equal in value to, the amount which would be
obtained in an arm's-length transaction between an informed and willing
buyer-user (other than a buyer-user currently in possession or a used equipment
or scrap dealer) and an informed and willing seller, under no compulsion to buy
or sell, and in such determination, costs of removal from the location of
current use shall not be a deduction from such value, and it shall be assumed
(whether or not the same be true) that the Equipment has been maintained and
would have been returned to Lessor in compliance with the requirements of the
Lease.
<PAGE>
If Lessor and Lessee fail to agree upon Fair Market Value on or before
one hundred sixty (160) days prior to the expiration of the Lease Term, then
such value shall be determined by the Appraisal Procedure (as set forth in
Section 3 below), at Lessee's sole cost and expense.
3. Appraisal Procedure. On the earlier of 160 days prior to the end of
the Lease Term or the date on which either party hereto shall have given written
notice to the other requesting determination of the Fair Market Value of the
Equipment by this Appraisal Procedure (the "Appraisal Notice"), the parties
shall consult for the purpose of appointing a qualified independent appraiser by
mutual agreement. If no such appraiser is so appointed within ten (10) business
days after the Appraisal Notice is given, each party shall appoint an
independent appraiser and the two appraisers shall attempt to jointly agree on
the Fair Market Value of the Equipment. If the two appraisers cannot so agree,
then the two appraisers so appointed shall appoint a third independent
appraiser. If the two appraisers have been unable to agree on the Fair Market
Value and on a third appraiser within thirty (30) days after the date of their
appointment, Lessor may apply to the American Society of Appraisers or the
American Arbitration Association to make such appointment, and both parties
shall be bound by any such appointment. Any appraiser or appraisers appointed
pursuant to this Appraisal Procedure shall be bound to determine the Fair Market
Value of the Equipment within thirty (30) days after the appointment of the
final appraiser to be employed pursuant to this Appraisal Procedure. If the
parties shall have appointed a single appraiser, his or her determination of
value shall be final, binding and conclusive on the parties. If the parties have
appointed two appraisers, then their jointly agreed determination of value shall
be final, binding and conclusive on the parties. If three appraisers shall be
appointed, the values determined by the three appraisers shall be averaged, the
appraisal having a value furthest from the average shall be discarded and the
remaining two appraised values shall be averaged, and the average of the
remaining two appraised values shall be final, binding and conclusive on the
parties.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: February 8, 1996
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
PURCHASE OPTION RIDER
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (the "Rider") is attached to and made a part
of that certain Lease Schedule No. 32053-01, dated as of December 19, 1995 (the
"Lease Schedule"), by and between the undersigned parties.
1. Purchase Option. If no Event of Default (or event or condition
which, with the passage of time or giving of notice, or both, would become such
an Event of Default) shall have occurred and be continuing, and the Lease shall
not have been earlier terminated, Lessee shall have the option to purchase (the
"Purchase Option") all, but not less than all, of the Equipment at the
expiration of the Lease Term for an amount, payable in immediately available
funds on the last day of the Lease Term, equal to: (a) all Rental Payments, late
charges and other amounts due and owing under the Lease; plus (b) all taxes,
assessments and other charges due or payable in connection with the sale of the
Equipment to Lessee; plus (c) the Purchase Option Price (hereinafter defined).
If Lessee elects to exercise its option under the terms of this Rider, it shall
automatically be deemed that Lessee has exercised the purchase option under and
pursuant to the terms of that certain Purchase Option Rider to Lease Schedule
No. 32053-02 dated February 8, 1995.
Provided that Lessor shall have received (a) all amounts payable
hereunder and (b) all amounts payable under the Purchase Option Rider applicable
to Lease Schedule No 32053-02 on the last day of the Lease Term, and that no
Event of Default then exists and is continuing under the Lease, Lessor shall
convey all of its right, title and interest in and to the Equipment to Lessee on
the last day of the Lease Term, on an "AS-IS", "WHERE-IS" BASIS WITHOUT
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, and without recourse to Lessor,
except that the Equipment shall be free and clear of all liens created by
Lessor. If Lessee intends to exercise the Purchase Option, Lessee shall give
irrevocable written notice to Lessor (the "Option Notice") not more than 240
days, nor less than 180 days, prior to the expiration of the Lease Term. If
Lessee fails to give such written notice to Lessor, it shall be conclusively
presumed that Lessee has elected not to exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 3% of the Acquisition Cost of the Equipment.
2. Purchase Option Price. if Lessee has elected to exercise the
Purchase Option, then the "Purchase Option Price" shall be the Fair Market Value
(hereinafter defined) of the Equipment, provided, however, that the Purchase
Option Price shall not exceed 30% of the Acquisition Cost of the Equipment. As
soon as practicable following Lessor's receipt of the Option Notice, Lessor and
Lessee shall agree on the Fair Market Value of the Equipment as of the end of
the Lease Term. "Fair Market Value" of the Equipment shall be the amount
determined on the basis of, and equal in value to, the amount which would be
obtained in an arm's-length transaction between an informed and willing
buyer-user (other than a buyer-user currently in possession or a used equipment
or scrap dealer) and an informed and willing seller, under no compulsion to buy
or sell, and in such determination, costs of removal from the location of
current use shall not be a deduction from such value, and it shall be assumed
(whether or not the same be true) that the Equipment has been maintained and
would have been returned to Lessor in compliance with the requirements of the
Lease.
<PAGE>
If Lessor and Lessee fail to agree upon Fair Market Value on or before
one hundred sixty (160) days prior to the expiration of the Lease Term, then
such value shall be determined by the Appraisal Procedure (as set forth in
Section 3 below), at Lessee's sole cost and expense.
3. Appraisal Procedure. On the earlier of 160 days prior to the end of
the Lease Term or the date on which either party hereto shall have given written
notice to the other requesting determination of the Fair Market Value of the
Equipment by this Appraisal Procedure (the "Appraisal Notice"), the parties
shall consult for the purpose of appointing a qualified independent appraiser by
mutual agreement. If no such appraiser is so appointed within ten (10) business
days after the Appraisal Notice is given, each party shall appoint an
independent appraiser and the two appraisers shall attempt to jointly agree on
the Fair Market Value of the Equipment. If the two appraisers cannot so agree,
then the two appraisers so appointed shall appoint a third independent
appraiser. If the two appraisers have been unable to agree on the Fair Market
Value and on a third appraiser within thirty (30) days after the date of their
appointment, Lessor may apply to the American Society of Appraisers or the
American Arbitration Association to make such appointment, and both parties
shall be bound by any such appointment. Any appraiser or appraisers appointed
pursuant to this Appraisal Procedure shall be bound to determine the Fair Market
Value of the Equipment within thirty (30) days after the appointment of the
final appraiser to be employed pursuant to this Appraisal Procedure. If the
parties shall have appointed a single appraiser, his or her determination of
value shall be final, binding and conclusive on the parties. If the parties have
appointed two appraisers, then their jointly agreed determination of value shall
be final, binding and conclusive on the parties. If three appraisers shall be
appointed, the values determined by the three appraisers shall be averaged, the
appraisal having a value furthest from the average shall be discarded and the
remaining two appraised values shall be averaged, and the average of the
remaining two appraised values shall be final, binding and conclusive on the
parties.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: December 19, 1995
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
SCHEDULE A
Attached to and made part of the following: Bill of Sale
with OPTICAL COATING LABORATORY, INC.
- --------------------------------------------------------------------------------
QTY LOCATION, VENDOR, DESCRIPTION MODEL NO. SERIAL NO.
- --------------------------------------------------------------------------------
DEPRECIABLE TAX LIFE IS 7 YEARS.
LOCATION (01)
1 ROBOT SEAMING __________ _______________
2 ROBOT FSM SEAMERS __________ _______________
__________ _______________
1 CONVEYOR SYSTEM __________ _______________
AS MORE FULLY DESCRIBED ON THE FOLLOWING INVOICES:
INVOICE # INVOICE DATE VENDOR
- --------- ------------ ------
1-10317 7/27/94 SONOMA PRECISION MFG. CO.
9243 7/20/95 SEBASTOPOL BEARING & HYDRAULIC CO., INC.
053230 8/10/94 BILLCO MANUFACTURING, INC.
4072250 7/22/94 AIRSLED, INC.
00132784 7/19/94 DORNER MFG CORP
4325 7/26/94 BUSH MACHINE INC.
17418 9/20/94 MOTOMAN, INC.
15607 4/29/94 MOTOMAN, INC.
WITH ALL STANDARD AND ACCESSORY EQUIPMENT
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
BY: /s/ Lisa D. Wardle BY: /s/ John M. Markovich
------------------------------ ------------------------------
NAME: LISA D. WARDLE NAME: John M. Markovich
---------------------------- ----------------------------
TITLE: Assistant Vice President TITLE: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
SCHEDULE A-1
Attached to and made part of the following: Bill of Sale
with OPTICAL COATING LABORATORY, INC.
EQUIPMENT IS CURRENTLY LOCATED:
LOCATION (01)
2789 NORTH POINT PARKWAY
SANTA ROSA, CA 95407
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
BY: /s/ Lisa D. Wardle BY: /s/ John M. Markovich
------------------------------ ------------------------------
NAME: LISA D. WARDLE NAME: John M. Markovich
---------------------------- ----------------------------
TITLE: Assistant Vice President TITLE: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
EARLY PURCHASE OPTION RIDER
(single option)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Early Purchase Option Rider (the "Rider") is attached to and
made a part of that certain Lease Schedule No. 32053-02, dated as of February 8,
1996 (the "Lease Schedule"), by and between the undersigned parties.
So long as no Event of Default has occurred and is continuing under
the Lease, and upon at least 90 days prior written notice to Lessor, Lessee
shall have the right to terminate the Lease Term for all but not less than all
of the Equipment on the Rental Payment Date for Rental Payment Number 59 (the
"Termination Date"). Lessee shall pay to Lessor on the Termination Date an
amount equal to: (a) all Rental Payments, late charges and other amounts due and
owing under the Lease; plus (b) all taxes, assessments and other charges due or
payable in connection with the sale of the Equipment to Lessee; plus, (c) 43% of
the Acquisition Cost of the Equipment. If Lessee elects to exercise its option
under the terms of this Rider, it shall automatically be deemed that Lessee has
exercised its purchase option under and pursuant to the terms of the Early
Purchase Option Rider dated December 19, 1995 under that certain Lease Schedule
No. 32053-01 dated December 19, 1995.
Provided that Lessor shall have received (a) all amounts payable
hereunder and (b) all amounts payable under the Early Purchase Option Rider
applicable to Lease Schedule No. 32053-01 on the Termination Date, and that no
Event of Default then exists and is continuing under the Lease, Lessor shall
convey all of its right, title and interest in and to the Equipment to Lessee
on the Termination Date, on an "AS-IS", "WHERE-IS" BASIS WITHOUT REPRESENTATION
OR WARRANTY, EXPRESS OR IMPLIED, and without recourse to Lessor, except that the
Equipment shall be free and clear of all liens created by Lessor.
In the event Lessee shall not pay all amounts due hereunder on the
Termination Date, then the Lease Term for the Equipment shall continue in full
force and effect, and this Rider shall be null and void and of no further force
and effect.
All capitalized terms used herein and not defined herein shall have
the meanings set forth or referred to in the Lease Schedule. Except as
specifically set forth herein, all of the terms and conditions of the Lease
shall remain in full force and effect and are hereby ratified and affirmed. To
the extent that the provisions of this Rider conflict with any provisions
contained in the Lease, the provisions of this Rider shall control.
Dated as of: February 8, 1996
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
STIPULATED LOSS VALUE SCHEDULE
[LOGO]
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Stipulated Loss Value Schedule (the "Schedule") is attached to
and made a part of that certain Lease Schedule No. 32053-00002, dated as of
FEBRUARY 08, 1996 (the "Lease Schedule"), by and between the undersigned
parties.
The following Stipulated Loss Values shall be used to calculate
damages or loss as provided in the Master Lease. The Stipulated Loss Value with
respect to any item of Equipment on any Rental Payment Date during the Lease
Term shall be an amount equal to the sum of: (a) all Rental Payments and other
amounts then due and owing to Lessor under the Lease, together with all accrued
interest and late charges thereon, calculated through and including the date of
payment; plus (b) the product of the Acquisition Cost of the such Equipment
multiplied by the percentage as of such Rental Payment Date as set forth on the
reverse side hereof.
All capitalized terms used herein and not defined herein shall have
the meanings set forth or referred to in the Lease Schedule. Except as
specifically set forth herein, all of the terms and conditions of the Lease
shall remain in full force and effect and are hereby ratified and affirmed.
Dated as of: FEBRUARY 08, 1996
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
<TABLE>
<CAPTION>
Rental Payment Date for Percentage of Rental Payment Date for Percentage of
Rental Payment Number Acquisition Cost Rental Payment Number Acquisition Cost
- ----------------------- ---------------- ---------------------- ----------------
<S> <C> <C> <C>
1 103.68110252 37 77.00940904
2 103.08445807 38 75.83859334
3 102.48143380 39 74.65809606
4 101.87257133 40 73.46891506
5 101.25759862 41 72.27367045
6 100.63672963 42 71.06967042
7 100.00970627 43 69.85955233
8 99.37617349 44 68.63958497
9 98.75665420 45 67.41074200
10 98.09091201 46 66.17568968
11 97.43858054 47 64.93068171
12 96.78017115 48 63.67667640
13 96.11546948 49 62.41636928
14 95.44409762 50 61.14599876
15 94.76602712 51 59.86552190
16 94.08051541 52 58.57630769
17 93.38242052 53 57.28282470
18 92.67678668 54 55.98054114
19 91.95849572 55 54.67394077
20 91.2T530593 56 53.35707949
21 90.50044587 57 52.03130398
22 89.75482845 58 50.70112535
23 89.00219561 59 49.36058520
24 88.24175908 60 48.01101570
25 87.46846386 61 46.65695567
26 86.68803514 62 45.29243222
27 85.90044249 63 43.91740073
28 85.10575923 64 42.53498712
29 84.30250730 65 41.15703793
30 83.49208863 66 39.77169242
31 82.67304347 67 38.39080057
32 81.84666960 68 36.99933084
33 81.01301660 69 35.60039907
34 80.17065173 70 34.20587103
35 79.32085867 71 32.80070692
36 78.17058428 71 30.00000000
</TABLE>
<PAGE>
FLEET CREDIT CORPORATION
SCHEDULE A-1
Attached to and made part of the following: True Lease Schedule No. 32053-02,
Acceptance Certificate
with OPTICAL COATING LABORATORY, INC.
EQUIPMENT IS CURRENTLY LOCATED:
LOCATION (01)
2789 NORTH POINT PARKWAY
SANTA ROSA, CA 95407
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
BY: /s/ Lisa D. Wardle BY: /s/ John M. Markovich
------------------------------ ------------------------------
NAME: LISA D. WARDLE NAME: John M. Markovich
---------------------------- ----------------------------
TITLE: Assistant Vice President TITLE: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
[LOGO] ACCEPTANCE CERTIFICATE
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Acceptance Certificate is attached to and made a part of that certain
Lease Schedule No. 32053 - 00002, dated as of FEBRUARY 08, 1996 (the "Lease
Schedule"), by and between the undersigned parties. All capitalized terms used
herein and not defined herein shall have the meanings set forth or referred to
in the Lease Schedule. To the extent the terms set forth in this Acceptance
Certificate differ or conflict with any of the terms set forth in the Lease, the
terms set forth in this Acceptance Certificate shall control.
1. Lessee acknowledges and agrees that each item of Equipment set forth on
Schedule A hereto (collectively, the "Equipment") is hereby unconditionally
accepted by Lessee for all purposes under the Lease at the locations specified
in Schedule A-1 hereto, and hereby agrees to faithfully perform all of its
obligations under the Lease as of the date hereof (the "Acceptance Date").
Lessee hereby authorizes and directs Lessor to make payment to each vendor of
the Equipment pursuant to such vendor's invoice or any purchase order, purchase
agreement or supply contract with such vendor, receipt and approval of which are
hereby reaffirmed by Lessee.
2. By its execution and delivery of this Acceptance Certificate, Lessee
hereby reaffirms all of the representations, warranties and covenants contained
in the Lease as of the date hereof, and further represents and warrants to
Lessor that no Event of Default, and no event or condition which with notice or
the passage of time or both would constitute an Event of Default, has occurred
and is continuing as of the date hereof. Lessee further certifies to Lessor that
Lessee has selected the Equipment and has received and approved the purchase
order, purchase agreement or supply contract under which the Equipment will be
acquired for all purposes of the Lease.
3. Lessee hereby represents and warrants that: (a) the Equipment has been
delivered and is in an operating condition and performing the operation for
which it is intended to the satisfaction of the Lessee; and (b) if requested by
Lessor, the Equipment has been marked or labeled evidencing the Lessor's
interest therein.
4. The LEASE TERM COMMENCEMENT DATE is the 20th day of January, 1996.
5. The RENTAL PAYMENT COMMENCEMENT DATE is the 20th day of January, 1996.
6. All terms and provisions of the Lease Schedule shall remain in full
force and effect, except as otherwise provided below:
- ACQUISITION COST: $______________________.
- LEASE TERM: ______________________ months.
- RENTAL PAYMENTS: Number of Rental Payments Rental Payment Amount
- ADVANCE RENTAL PAYMENT(S): First______________ and last ______________.
- SECURITY DEPOSIT: ______________________ %.
Dated: 2/15/96
Agreed and Accepted:
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: Name: John M. Markovich
---------------------------- ----------------------------
Title: Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
SCHEDULE A
Attached to and made part of the following: True Lease Schedule No. 32053-02,
Acceptance Certificate, UCC Financing Statement(s)
with OPTICAL COATING LABORATORY, INC.
- --------------------------------------------------------------------------------
QTY LOCATION, VENDOR, DESCRIPTION MODEL NO. SERIAL NO.
- --------------------------------------------------------------------------------
DEPRECIABLE TAX LIFE IS 7 YEARS.
LOCATION (01)
1 ROBOT SEAMING __________ _______________
2 ROBOT FSM SEAMERS __________ _______________
__________ _______________
1 CONVEYOR SYSTEM __________ _______________
AS MORE FULLY DESCRIBED ON THE FOLLOWING INVOICES:
INVOICE # INVOICE DATE VENDOR
- --------- ------------ ------
1-10317 7/27/94 SONOMA PRECISION MFG. CO.
9243 7/20/95 SEBASTOPOL BEARING & HYDRAULIC CO., INC.
053230 8/10/94 BILLCO MANUFACTURING, INC.
4072250 7/22/94 AIRSLED, INC.
00132784 7/19/94 DORNER MFG CORP
4325 7/26/94 BUSH MACHINE INC.
17418 9/20/94 MOTOMAN, INC.
15607 4/29/94 MOTOMAN, INC.
WITH ALL STANDARD AND ACCESSORY EQUIPMENT
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
BY: /s/ Lisa D. Wardle BY: /s/ John M. Markovich
------------------------------ ------------------------------
NAME: LISA D. WARDLE NAME: John M. Markovich
---------------------------- ----------------------------
TITLE: Assistant Vice President TITLE: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
4. EQUIPMENT LOCATION(S). The Equipment will be located at the
location(s) specified in Schedule A-1 hereto.
5. Lessor will invoice Lessee for all sales, use and/or personal
property taxes as and when due and payable in accordance with applicable law,
unless Lessee delivers to Lessor a valid exemption certificate with respect to
such taxes. Delivery of such certificate shall constitute Lessee's
representation and warranty that no such taxes shall become due and payable with
respect to the Equipment, and Lessee shall indemnify and hold harmless Lessor
from and against any and all liability or damages, including late charges and
interest which Lessor may incur by reason of the assessment of such taxes.
6. The Rental Payments may change for Equipment accepted after
FEBRUARY 24, 1996.
Dated as of: FEBRUARY 08, 1996
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
PURCHASE OPTION RIDER
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (the "Rider") is attached to and made a part
of that certain Lease Schedule No. 32053-O1, dated as of December 19, 1995 (the
"Lease Schedule"), by and between the undersigned parties.
1. Purchase Option. If no Event of Default (or event or condition
which, with the passage of time or giving of notice, or both, would become such
an Event of Default) shall have occurred and be continuing, and the Lease shall
not have been earlier terminated, Lessee shall have the option to purchase (the
"Purchase Option") all, but not less than all, of the Equipment at the
expiration of the Lease Term for an amount, payable in immediately available
funds on the last day of the Lease Term, equal to: (a) all Rental Payments, late
charges and other amounts due and owing under the Lease; plus (b) all taxes,
assessments and other charges due or payable in connection with the sale of the
Equipment to Lessee; plus (c) the Purchase Option Price (hereinafter defined).
If Lessee elects to exercise its option under the terms of this Rider, it shall
automatically be deemed that Lessee has exercised the purchase option under and
pursuant to the terms of that certain Purchase Option Rider to Lease Schedule
No. 32053-02 dated February 8, 1995.
Provided that Lessor shall have received (a) all amounts payable
hereunder and (b) all amounts payable under the Purchase Option Rider applicable
to Lease Schedule No 32053-02 on the last day of the Lease Term, and that no
Event of Default then exists and is continuing under the Lease, Lessor shall
convey all of its right, title and interest in and to the Equipment to Lessee on
the last day of the Lease Term, on an "AS-IS", "WHERE-IS" BASIS WITHOUT
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, and without recourse to Lessor,
except that the Equipment shall be free and clear of all liens created by
Lessor. If Lessee intends to exercise the Purchase Option, Lessee shall give
irrevocable written notice to Lessor (the "Option Notice") not more than 240
days, nor less than 180 days, prior to the expiration of the Lease Term. If
Lessee fails to give such written notice to Lessor, it shall be conclusively
presumed that Lessee has elected not to exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 3% of the Acquisition Cost of the Equipment.
2. Purchase Option Price. If Lessee has elected to exercise the
Purchase Option, then the "Purchase Option Price" shall be the Fair Market Value
(hereinafter defined) of the Equipment, provided, however, that the Purchase
Option Price shall not exceed 30% of the Acquisition Cost of the Equipment. As
soon as practicable following Lessor's receipt of the Option Notice, Lessor and
Lessee shall agree on the Fair Market Value of the Equipment as of the end of
the Lease Term. "Fair Market Value" of the Equipment shall be the amount
determined on the basis of, and equal in value to, the amount which would be
obtained in an arm's-length transaction between an informed and willing
buyer-user (other than a buyer-user currently in possession or a used equipment
or scrap dealer) and an informed and willing seller, under no compulsion to buy
or sell, and in such determination, costs of removal from the location of
current use shall not be a deduction from such value, and it shall be assumed
(whether or not the same be true) that the Equipment has been maintained and
would have been returned to Lessor in compliance with the requirements of the
Lease.
<PAGE>
If Lessor and Lessee fail to agree upon Fair Market Value on or before
one hundred sixty (160) days prior to the expiration of the Lease Term, then
such value shall be determined by the Appraisal Procedure (as set forth in
Section 3 below), at Lessee's sole cost and expense.
3. Appraisal Procedure. On the earlier of 160 days prior to the end of
the Lease Term or the date on which either party hereto shall have given written
notice to the other requesting determination of the Fair Market Value of the
Equipment by this Appraisal Procedure (the "Appraisal Notice"), the parties
shall consult for the purpose of appointing a qualified independent appraiser by
mutual agreement. If no such appraiser is so appointed within ten (10) business
days after the Appraisal Notice is given, each party shall appoint an
independent appraiser and the two appraisers shall attempt to jointly agree on
the Fair Market Value of the Equipment. If the two appraisers cannot so agree,
then the two appraisers so appointed shall appoint a third independent
appraiser. If the two appraisers have been unable to agree on the Fair Market
Value and on a third appraiser within thirty (30) days after the date of their
appointment, Lessor may apply to the American Society of Appraisers or the
American Arbitration Association to make such appointment, and both parties
shall be bound by any such appointment. Any appraiser or appraisers appointed
pursuant to this Appraisal Procedure shall be bound to determine the Fair Market
Value of the Equipment within thirty (30) days after the appointment of the
final appraiser to be employed pursuant to this Appraisal Procedure. If the
parties shall have appointed a single appraiser, his or her determination of
value shall be final, binding and conclusive on the parties. If the parties have
appointed two appraisers, then their jointly agreed determination of value shall
be final, binding and conclusive on the parties. If three appraisers shall be
appointed, the values determined by the three appraisers shall be averaged, the
appraisal having a value furthest from the average shall be discarded and the
remaining two appraised values shall be averaged, and the average of the
remaining two appraised values shall be final, binding and conclusive on the
parties.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: December 19, 1995
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
EARLY PURCHASE OPTION RIDER
(single option)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Early Purchase Option Rider (the "Rider") is attached to and made
a part of that certain Lease Schedule No. 32053-01, dated as of December 19,
1995 (the "Lease Schedule"), by and between the undersigned parties.
So long as no Event of Default has occurred and is continuing under
the Lease, and upon at least 90 days prior written notice to Lessor, Lessee
shall have the right to terminate the Lease Term for all but not less than all
of the Equipment on the Rental Payment Date for Rental Payment Number 60 (the
"Termination Date"). Lessee shall pay to Lessor on the Termination Date an
amount equal to: (a) all Rental Payments, late charges and other amounts due and
owing under the Lease; plus (b) all taxes, assessments and other charges due or
payable in connection with the sale of the Equipment to Lessee; plus, (c) 43% of
the Acquisition Cost of the Equipment. If Lessee elects to exercise its option
under the terms of this Rider, it shall automatically be deemed that Lessee has
exercised its purchase option under and pursuant to the terms of the Early
Purchase Option Rider dated February 8, 1996 under that certain Lease Schedule
No. 32053-02 dated February 8, 1996.
Provided that Lessor shall have received (a) all amounts payable
hereunder and (b) all amounts payable under the Early Purchase Option Rider
applicable to Lease Schedule No. 32053-02 on the Termination Date, and that no
Event of Default then exists and is continuing under the Lease, Lessor shall
convey all of its right, title and interest in and to the Equipment to Lessee on
the Termination Date, on an "AS-IS", "WHERE-IS" BASIS WITHOUT REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, and without recourse to Lessor, except that the
Equipment shall be free and clear of all liens created by Lessor.
In the event Lessee shall not pay all amounts due hereunder on the
Termination Date, then the Lease Term for the Equipment shall continue in full
force and effect, and this Rider shall be null and void and of no further force
and effect.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: December 19, 1995
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
Jeffrey M. Ryan Optical Coating
Assistant Treasurer Laboratory, Inc.
2789 Northpoint Parkway
Santa Rosa, California
95407-7397
(707) 525-7656
FAX 707/525-7410
February 13, 1996
John Gould
Vice President
Fleet Credit Corporation
5th Floor
50 Kennedy Plaza
Providence, RI 02903-2305
Re: $10,000,000 Lease Line
Dear John:
Please find enclosed the signed documentation relating to the second transaction
against the subject lease line. The amount of the transaction is $1,000,000. I
would kindly ask that after a Fleet representative signs the documentation on
behalf of Fleet that a copy of this transaction documentation be sent to my
attention at the address on this letterhead.
Thanks and regards,
/s/ Jeff
<PAGE>
CLOSING CHECKLIST
TO: Mr. Jeff Ryan
RE: OPTICAL COATING LABORATORY, INC. ACCOUNT NUMBER: 32053-02
MASTER DOCUMENTS LEASE DOCUMENTS
- ----------------------------------------- ------------------------------------
___ CERTIFIED COPY OF RESOLUTIONS ___ LEASE SCHEDULE
- ----------------------------------------- ------------------------------------
___ MASTER EQUIPMENT LEASE AGREEMENT _X_ TRUE LEASE SCHEDULE
- ----------------------------------------- ------------------------------------
___ MASTER SECURTY AGREEMENT _X_ SCHEDULE A W/ SCHEDULE A-1
- ----------------------------------------- ------------------------------------
___ GUARANTY _X_ ACCEPTANCE CERTIFICATE
- ----------------------------------------- ------------------------------------
___ ADD'L SECURITY AGREE. (w/ UCC-1) _X_ WARRANTY BILL OF SALE
- ----------------------------------------- ------------------------------------
___ MAINTENANCE AND RETURN RIDER _X_ PURCHASE OPTION RIDER (2)
- -----------------------------------------
___ ADDENDUM (To:___________________ (Specify: FMV/CAP/RET FEE
- ----------------------------------------- ------------------------------------
_X_ EARLY PURCHASE OPTION RIDER (2)
LOAN DOCUMENTS ------------------------------------
- ----------------------------------------- _X_ STIPULATED LOSS VALUE SCHEDULE
___ SECURED PROMISSORY NOTE ------------------------------------
- ----------------------------------------- _X_ UCC-1 FINANCING STATEMENT(s)(2)
___ FIXED RATE _X_ PAY PROCEEDS LETTER
- ----------------------------------------- ------------------------------------
___ FLOATING RATE ___ INVOICE ($_______________)
- ----------------------------------------- ------------------------------------
___ NOTE ACCEPTANCE CERTIFICATE
- ----------------------------------------- SPECIAL DOCUMENTS
___ SCHEDULE A ___ EQUIPMENT INSPECTION
- ----------------------------------------- ___ UCC SEARCHES/WAIVERS
___ CERTIFICATE OF INSURANCE
- ----------------------------------------- --- --------------------------------
___ UCC-1 FINANCING STATEMENT(s) --- --------------------------------
- ----------------------------------------- --- --------------------------------
___ DISBURSEMENT --- --------------------------------
- ----------------------------------------- --- --------------------------------
___ INVOICE ($_______________) --- --------------------------------
- ----------------------------------------- --- --------------------------------
CONDITIONS PRECEDENT TO FUNDING:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
JEANETTE R. FERNANDES 2/8/96
- ------------------------------------ --------------------
CA's INITIALS DATED
<PAGE>
[LOGO] LEASE SCHEDULE NO. 32053-00002
(True Lease Schedule)
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
Lessee: OPTICAL COATING LABORATORY, INC.
Address: 2789 NORTH POINT PARKWAY
SANTA ROSA, CA 95407
1. This Lease Schedule No. 32053-00002 dated as of FEBRUARY 08,
1996 is entered into pursuant to and incorporates by this reference, all of the
terms and provisions of that certain Master Equipment Lease Agreement No. 32053
dated as of DECEMBER 19, 1995 (the "Master Lease"), for the lease of the
Equipment described in Schedule A attached hereto. This Lease Schedule shall
constitute a separate, distinct and independent lease of the Equipment and the
contractual obligation of Lessee. References to the "the Lease" or "this Lease"
shall mean and refer to this Lease Schedule, together with the Master Lease and
all exhibits, addenda, schedules, certificates, riders and other documents and
instruments executed and delivered in connection with this Lease Schedule, all
as the same may be amended or modified from time to time. All capitalized terms
used herein and not defined herein shall have the meanings set forth or referred
to in the Master Lease. By its execution and delivery of this Lease Schedule,
Lessee hereby reaffirms all of the representations, warranties and covenants
contained in the Master Lease, as of the date hereof, and further represents and
warrants to Lessor that no Event of Default, and no event or condition which
with notice or the passage of time or both would constitute an Event of Default,
has occurred and is continuing as of the date hereof.
2. ACQUISITION COST. The Acquisition Cost of the Equipment is: $1,000,000.0O.
3. (a) LEASE TERM. The Lease Term shall commence on the date
hereof and shall continue for a period of 71 months after the Lease Term
Commencement Date set forth in the Acceptance Certificate to this Lease
Schedule, plus any renewal or extended term applicable in accordance with the
terms of the Lease.
(b) RENTAL PAYMENTS. In addition to interim rent payable
pursuant to Section 2 of the Master Lease, Lessee shall pay Lessor 71
consecutive Rental Payments in the amounts set forth in the schedule below, plus
any applicable sales/use taxes, commencing on the Rental Payment Commencement
Date set forth in the Acceptance Certificate and MONTHLY thereafter for the
remaining Lease Term. Each Rental Payment shall be payable on the same day of
the month as the Rental Payment Date in each succeeding rental period during the
remaining Lease Term (each, a "Rental Payment Date")'
Amount of Each
Number of Rental Payments Rental Payment
------------------------- ---------------
35 13,188.97
36 16,119.86
(c) ADVANCE RENTAL PAYMENT. Lessee agrees to pay Lessor the
first 01 and last O Rental Payments, due and payable on the Acceptance Date.
(d) SECURITY DEPOSIT. Lessee agrees to make a payment in an
amount equal to 0% of the Acquisition Cost of the Equipment, due and payable on
the Acceptance Date, to be held by Lessor as a non-interest bearing deposit to
secure Lessee's performance under the Lease.
<PAGE>
[LOGO] WARRANTY BILL OF SALE
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903
OPTICAL COATING LABORATORY, INC. ("Seller") of 2789 NORTH POINT
PARKWAY, SANTA ROSA, CA 95407, in consideration of the sum of $1,000,000.00
Dollars, and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, does hereby sell, transfer and assign to Fleet
Credit Corporation ("FCC") a Rhode Island corporation having its principal
office at 50 Kennedy Plaza, Providence, Rhode Island 02903, the equipment set
forth in Schedule A hereto (the "Equipment").
Seller hereby covenants with and warrants to FCC that Seller is the
lawful owner of the Equipment and has the right to sell the Equipment, and that
the Equipment is free and clear of all rights, claims, liens, charges, security
interests or encumbrances of any other person. Seller will forever indemnify,
defend and warrant all of the rights of FCC in and to the Equipment transferred
hereunder against the claims and demands of all other persons.
IN WITNESS WHEREOF, Seller has duly executed this Bill of Sale this 13th day of
February, 1996.
OPTICAL COATING LABORATORY, INC.
By: /s/ John M. Markovich
------------------------------
Name: John M. Markovich
----------------------------
Title: Vice President Finance and
---------------------------
Chief Financial Officer
State of CALIFORNIA
--------------------
County of SONOMA
--------------------
Subcribed and sworn before me this 13th day of February, 1996.
/s/ Silvia C. Hogan
----------------------------------------
Notary Public
My Commission expires: November 11, 1997
------------------
(SEAL)
===============================
SILVIA C. HOGAN
COMM. #1009258
Notary Public--California
SONOMA COUNTY
My Comm. Expires NOV 11, 1997
===============================
<PAGE>
FLEET CREDIT CORPORATION
EARLY PURCHASE OPTION RIDER
(single option)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Early Purchase Option Rider (the "Rider") is attached to and made a
part of that certain Lease Schedule No. 32053-01, dated as of December 19, 1995
(the "Lease Schedule"), by and between the undersigned parties.
So long as no Event of Default has occurred and is continuing under the
Lease, and upon at least 90 days prior written notice to Lessor, Lessee shall
have the right to terminate the Lease Term for all but not less than all of the
Equipment on the Rental Payment Date for Rental Payment Number 60 (the
"Termination Date"). Lessee shall pay to Lessor on the Termination Date an
amount equal to: (a) all Rental Payments, late charges and other amounts due and
owing under the Lease; plus (b) all taxes, assessments and other charges due or
payable in connection with the sale of the Equipment to Lessee; plus, (c) 43%
of the Acquisition Cost of the Equipment. If Lessee elects to exercise its
option under the terms of this Rider, it shall automatically be deemed that
Lessee has exercised its purchase option under and pursuant to the terms of the
Early Purchase Option Rider dated February 8, 1996 under that certain Lease
Schedule No. 32053-02 dated February 8, 1996.
Provided that Lessor shall have received (a) all amounts payable
hereunder and (b) all amounts payable under the Early Purchase Option Rider
applicable to Lease Schedule No. 32053-02 on the Termination Date, and that no
Event of Default then exists and is continuing under the Lease, Lessor shall
convey all of its right, title and interest in and to the Equipment to Lessee on
the Termination Date, on an "AS-IS", "WHERE-IS" BASIS WITHOUT REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, and without recourse to Lessor, except that the
Equipment shall be free and clear of all liens created by Lessor.
In the event Lessee shall not pay all amounts due hereunder on the
Termination Date, then the Lease Term for the Equipment shall continue in full
force and effect, and this Rider shall be null and void and of no further force
and effect.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: December 19, 1995.
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
50 Kennedy Plaza
Providence, RI 02903-2305
1-800-238-3737
OPTICAL COATING LABORATORY, IN
2789 NORTH POINT PARKWAY
SANTA ROSA CA 95407-0000
February 13, 1996
- --------------------------------------------------------------------------------
DESCRIPTION AMOUNT
- --------------------------------------------------------------------------------
ADVANCE PAYMENT $13,188.97 +
TRANSACTION EXPENSES $ 1,000.00 +
SH FUND $14,188.97 -
Total Due $14,188.97
Total Received $14,188.97
Balance $0.00
- --------------------------------------------------------------------------------
RETURN YOUR REMITTANCE TO THE ATTENTION OF: JEANETTE FERNANDES
TO INSURE PROPER CREDIT TO YOUR ACCOUNT, PLEASE RETURN REMITTANCE COPY.
A Subsidiary of Fleet National Bank
32053 00 002 00002
<PAGE>
[LOGO] PAY PROCEEDS LETTER
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
We hereby authorize you to pay the following Payee(s) from the proceeds of
your financial accommodations to us in respect of that certain True Lease
Schedule No. 32053-00002 dated as of FEBRUARY 08, 1996, and make disbursements
directly to said Payee(s) as follows:
Amount of
PAYEE Payment
OPTICAL COATING LABORATORY, INC. $ 985,811.03
- ------------------------------------------ -------------------------
FLEET CREDIT CORPORATION (short fund) $ 14,188.97
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
- ------------------------------------------ -------------------------
TOTAL: $ 1,000,000.00
--------------------
Dated as of: FEBRUARY 08, 1996
OPTICAL COATING LABORATORY, INC.
By: /s/ John M. Markovich
------------------------------
Name: John M. Markovich
----------------------------
Title: Vice President Finance and
---------------------------
Chief Financial Officer
<PAGE>
<TABLE>
<CAPTION>
This FINANCING STATEMENT is presented for filing and will remain effective with certain
exceptions for a period of five years from the date of filing pursuant to section 9403 of the
California Uniform Commercial Code.
- ------------------------------------------------------------------------------------------------
<C> <C>
1. DEBTOR (LAST NAME FIRST--IF AN INDIVIDUAL) 1A. SOCIAL SECURITY OR FEDERAL TAX NO.
OPTICAL COATING LABORATORY. INC. 08-0164244
- ------------------------------------------------------------------------------------------------
1B. MAILING ADDRESS 1C. CITY, STATE 1D. ZIP CODE
2789 Northpoint Parkway Santa Rosa, California 95407
- ------------------------------------------------------------------------------------------------
2. ADDITIONAL DEBTOR (IF ANY) 2A. SOCIAL SECURITY OR FEDERAL TAX NO.
(LAST NAME FIRST--IF AN INDIVIDUAL)
- ------------------------------------------------------------------------------------------------
2B. MAILING ADDRESS 2C. CITY, STATE 2D. ZIP CODE
- ------------------------------------------------------------------------------------------------
3. DEBTOR'S TRADE NAMES OR STYLES (IF ANY) 3A. FEDERAL TAX NUMBER
================================================================================================
4. SECURED PARTY 4A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME FLEET CREDIT CORPORATION
MAILING ADDRESS 50 Kennedy Plaza, 5th Floor
CITY Providence STATE RI ZIP CODE 02903
- ------------------------------------------------------------------------------------------------
5. ASSIGNEE OF SECURED PARTY (IF ANY) 5A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME
MAILING ADDRESS
CITY
- ------------------------------------------------------------------------------------------------
6. This FINANCING STATEMENT covers the following types or items of property (include description
of real property on which located and owner of record when required by instruction 4).
(1) Robot Seaming, (2) Robot FSM Seamers and a Conveyor System as set forth on attached
Schedule A, and all additions, accessions, modifications, improvements, replacements,
substitutions and accessories thereto and therefor, whether now owned or hereafter acquired,
and the proceeds of any of the foregoing, including insurance proceeds. Debtor has possession
of the equipment under a True Lease only. Secured Party has a security interest in the
equipment to the extent necessary to protect its title and interest therein. Pursuant to the
Master Equipment Lease Agreement dated December 19, 1995, Debtor has the option to purchase
the subject equipment at the end of the lease term.
Acct#32053-02/jrf
File: Secretary of State/California FIXTURE FILING
- ------------------------------------------------------------------------------------------------
7. CHECK [X] 7A. [ ] PRODUCTS OF COLLATERAL 7B. DEBTOR(S) SIGNATURE NOT REQUIRED IN
IF APPLICABLE ARE ALSO COVERED ACCORDANCE WITH INSTRUCTION 5(a) ITEM:
[ ](1) [ ](2) [ ](3) [ ](4)
- ------------------------------------------------------------------------------------------------
8. CHECK [X] [ ] DEBTOR IS A "TRANSMITTING UTILITY"
IF APPLICABLE IN ACCORDANCE WITH UCC SS. 9105 (1)(n)
- ------------------------------------------------------------------------------------------------
9. DATE: C 10. THIS SPACE FOR USE OF FILING OFFICER
O (DATE, TIME, FILE NUMBER
/s/ John M. Markovich 2/13/96 D AND FILING OFFICER)
SIGNATURE(S) OF DEBTOR(S) E
- -------------------------------------------------- ---
OPTICAL COATING LABORATORY, INC. 1
TYPE OR PRINT NAME(S) OF DEBTOR(S) 2
- --------------------------------------------------
3
/s/ Jeanette R. Fernandes
SIGNATURE(S) OF SECURED PARTY(IES) 4
- --------------------------------------------------
FLEET CREDIT C0RPORATION 5
TYPE OR PRINT NAME(S) OF SECURED PARTY(IES) 6
==================================================
11. Return copy to: 7
NAME 8
ADDRESS
CITY 9
STATE
ZIP CODE 0
==================================================
FORM UCC.1--
Approved by the Secretary of State
==================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
This FINANCING STATEMENT is presented for filing and will remain effective with certain
exceptions for a period of five years from the date of filing pursuant to section 9403 of the
California Uniform Commercial Code.
- ------------------------------------------------------------------------------------------------
<C> <C>
1. DEBTOR (LAST NAME FIRST--IF AN INDIVIDUAL) 1A. SOCIAL SECURITY OR FEDERAL TAX NO.
OPTICAL COATING LABORATORY. INC. 08-0164244
- ------------------------------------------------------------------------------------------------
1B. MAILING ADDRESS 1C. CITY, STATE 1D. ZIP CODE
2789 Northpoint Parkway Santa Rosa, California 95407
- ------------------------------------------------------------------------------------------------
2. ADDITIONAL DEBTOR (IF ANY) 2A. SOCIAL SECURITY OR FEDERAL TAX NO.
(LAST NAME FIRST--IF AN INDIVIDUAL)
- ------------------------------------------------------------------------------------------------
2B. MAILING ADDRESS 2C. CITY, STATE 2D. ZIP CODE
- ------------------------------------------------------------------------------------------------
3. DEBTOR'S TRADE NAMES OR STYLES (IF ANY) 3A. FEDERAL TAX NUMBER
================================================================================================
4. SECURED PARTY 4A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME FLEET CREDIT CORPORATION
MAILING ADDRESS 50 Kennedy Plaza, 5th Floor
CITY Providence STATE RI ZIP CODE 02903
- ------------------------------------------------------------------------------------------------
5. ASSIGNEE OF SECURED PARTY (IF ANY) 5A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME
MAILING ADDRESS
CITY
- ------------------------------------------------------------------------------------------------
6. This FINANCING STATEMENT covers the following types or items of property (include description
of real property on which located and owner of record when required by instruction 4).
(1) Robot Seaming, (2) Robot FSM Seamers and a Conveyor System as set forth on attached
Schedule A, and all additions, accessions, modifications, improvements, replacements,
substitutions and accessories thereto and therefor, whether now owned or hereafter acquired,
and the proceeds of any of the foregoing, including insurance proceeds. Debtor has possession
of the equipment under a True Lease only. Secured Party has a security interest in the
equipment to the extent necessary to protect its title and interest therein. Pursuant to the
Master Equipment Lease Agreement dated December 19, 1995, Debtor has the option to purchase
the subject equipment at the end of the lease term.
Acct#32053-02/jrf
File: Secretary of State/California
- ------------------------------------------------------------------------------------------------
7. CHECK [X] 7A. [ ] PRODUCTS OF COLLATERAL 7B. DEBTOR(S) SIGNATURE NOT REQUIRED IN
IF APPLICABLE ARE ALSO COVERED ACCORDANCE WITH INSTRUCTION 5(a) ITEM:
[ ](1) [ ](2) [ ](3) [ ](4)
- ------------------------------------------------------------------------------------------------
8. CHECK [X] [ ] DEBTOR IS A "TRANSMITTING UTILITY"
IF APPLICABLE IN ACCORDANCE WITH UCC SS. 9105 (1)(n)
- ------------------------------------------------------------------------------------------------
9. DATE: C 10. THIS SPACE FOR USE OF FILING OFFICER
O (DATE, TIME, FILE NUMBER
/s/ John M. Markovich 2/13/96 D AND FILING OFFICER)
SIGNATURE(S) OF DEBTOR(S) E
- -------------------------------------------------- ---
OPTICAL COATING LABORATORY, INC. 1
TYPE OR PRINT NAME(S) OF DEBTOR(S) 2
- --------------------------------------------------
3
/s/ Jeanette R. Fernandes
SIGNATURE(S) OF SECURED PARTY(IES) 4
- --------------------------------------------------
FLEET CREDIT C0RPORATION 5
TYPE OR PRINT NAME(S) OF SECURED PARTY(IES) 6
==================================================
11. Return copy to: 7
NAME 8
ADDRESS
CITY 9
STATE
ZIP CODE 0
==================================================
FORM UCC.1--
Approved by the Secretary of State
==================================================
</TABLE>
<PAGE>
FLEET CREDIT CORPORATION
PURCHASE OPTION RIDER
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (the "Rider") is attached to and made a part
of that certain Lease Schedule No. 32053-02, dated as of February 8, 1996 (the
"Lease Schedule"), by and between the undersigned parties.
1. Purchase Option. If no Event of Default (or event or condition
which, with the passage of time or giving of notice, or both, would become such
an Event of Default) shall have occurred and be continuing, and the Lease shall
not have been earlier terminated, Lessee shall have the option to purchase (the
"Purchase Option") all, but not less than all, of the Equipment at the
expiration of the Lease Term for an amount, payable in immediately available
funds on the last day of the Lease Term, equal to: (a) all Rental Payments, late
charges and other amounts due and owing under the Lease; plus (b) all taxes,
assessments and other charges due or payable in connection with the sale of the
Equipment to Lessee; plus, (c) the Purchase Option Price (hereinafter defined).
If Lessee elects to exercise its option under the terms of this Rider, it shall
automatically be deemed that Lessee has exercised the purchase option under and
pursuant to the terms of that certain Purchase Option Rider to Lease Schedule
No. 32053-01 dated December 19, 1995.
Provided that Lessor shall have received (a) all amounts payable
hereunder and (b) all amounts payable under the Purchase Option Rider applicable
to Lease Schedule No 32053-01 on the last day of the Lease Term, and that no
Event of Default then exists and is continuing under the Lease, Lessor shall
convey all of its right, title and interest in and to the Equipment to Lessee on
the last day of the Lease Term, on an "AS-IS", "WHERE-IS" BASIS WITHOUT
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, and without recourse to Lessor,
except that the Equipment shall be free and clear of all liens created by
Lessor. If Lessee intends to exercise the Purchase Option, Lessee shall give
irrevocable written notice to Lessor (the "Option Notice") not more than 240
days, nor less than 180 days, prior to the expiration of the Lease Term. If
Lessee fails to give such written notice to Lessor, it shall be conclusively
presumed that Lessee has elected not to exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 3% of the Acquisition Cost of the Equipment.
2. Purchase Option Price. If Lessee has elected to exercise the
Purchase Option, then the "Purchase Option Price" shall be the Fair Market Value
(hereinafter defined) of the Equipment, provided, however, that the Purchase
Option Price shall not exceed 30% of the Acquisition Cost of the Equipment. As
soon as practicable following Lessor's receipt of the Option Notice, Lessor and
Lessee shall agree on the Fair Market Value of the Equipment as of the end of
the Lease Term. "Fair Market Value" of the Equipment shall be the amount
determined on the basis of, and equal in value to, the amount which would be
obtained in an arm's-length transaction between an informed and willing
buyer-user (other than a buyer-user currently in possession or a used equipment
or scrap dealer) and an informed and willing seller, under no compulsion to buy
or sell, and in such determination, costs of removal from the location of
current use shall not be a deduction from such value, and it shall be assumed
(whether or not the same be true) that the Equipment has been maintained and
would have been returned to Lessor in compliance with the requirements of the
Lease.
<PAGE>
If Lessor and Lessee fail to agree upon Fair Market Value on or before
one hundred sixty (160) days prior to the expiration of the Lease Term, then
such value shall be determined by the Appraisal Procedure (as set forth in
Section 3 below), at Lessee's sole cost and expense.
3. Appraisal Procedure. On the earlier of 160 days prior to the end of
the Lease Term or the date on which either party hereto shall have given written
notice to the other requesting determination of the Fair Market Value of the
Equipment by this Appraisal Procedure (the "Appraisal Notice"), the parties
shall consult for the purpose of appointing a qualified independent appraiser by
mutual agreement. If no such appraiser is so appointed within ten (10) business
days after the Appraisal Notice is given, each party shall appoint an
independent appraiser and the two appraisers shall attempt to jointly agree on
the Fair Market Value of the Equipment. If the two appraisers cannot so agree,
then the two appraisers so appointed shall appoint a third independent
appraiser. If the two appraisers have been unable to agree on the Fair Market
Value and on a third appraiser within thirty (30) days after the date of their
appointment, Lessor may apply to the American Society of Appraisers or the
American Arbitration Association to make such appointment, and both parties
shall be bound by any such appointment. Any appraiser or appraisers appointed
pursuant to this Appraisal Procedure shall be bound to determine the Fair Market
Value of the Equipment within thirty (30) days after the appointment of the
final appraiser to be employed pursuant to this Appraisal Procedure. If the
parties shall have appointed a single appraiser, his or her determination of
value shall be final, binding and conclusive on the parties. If the parties have
appointed two appraisers, then their jointly agreed determination of value shall
be final, binding and conclusive on the parties. If three appraisers shall be
appointed, the values determined by the three appraisers shall be averaged, the
appraisal having a value furthest from the average shall be discarded and the
remaining two appraised values shall be averaged, and the average of the
remaining two appraised values shall be final, binding and conclusive on the
parties.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: February 8, 1996
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
PURCHASE OPTION RIDER
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (the "Rider") is attached to and made a part
of that certain Lease Schedule No. 32053-01, dated as of December 19, 1995 (the
"Lease Schedule"), by and between the undersigned parties.
1. Purchase Option. If no Event of Default (or event or condition
which, with the passage of time or giving of notice, or both, would become such
an Event of Default) shall have occurred and be continuing, and the Lease shall
not have been earlier terminated, Lessee shall have the option to purchase (the
"Purchase Option") all, but not less than all, of the Equipment at the
expiration of the Lease Term for an amount, payable in immediately available
funds on the last day of the Lease Term, equal to: (a) all Rental Payments, late
charges and other amounts due and owing under the Lease; plus (b) all taxes,
assessments and other charges due or payable in connection with the sale of the
Equipment to Lessee; plus ( ) the Purchase Option Price (hereinafter defined).
If Lessee elects to exercise its option under the terms of this Rider, it shall
automatically be deemed that Lessee has exercised the purchase option under and
pursuant to the terms of that certain Purchase Option Rider to Lease Schedule
No. 32053-02 dated February 8, 1995.
Provided that Lessor shall have received (a) all amounts payable
hereunder and (b) all amounts payable under the Purchase Option Rider applicable
to Lease Schedule No 32053-02 on the last day of the Lease Term, and that no
Event of Default then exists and is continuing under the Lease, Lessor shall
convey all of its right, title and interest in and to the Equipment to Lessee on
the last day of the Lease Term, on an "AS-IS", "WHERE-IS" BASIS WITHOUT
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, and without recourse to Lessor,
except that the Equipment shall be free and clear of all liens created by
Lessor. If Lessee intends to exercise the Purchase Option, Lessee shall give
irrevocable written notice to Lessor (the "Option Notice") not more than 240
days, nor less than 180 days, prior to the expiration of the Lease Term. If
Lessee fails to give such written notice to Lessor, it shall be conclusively
presumed that Lessee has elected not to exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 3% of the Acquisition Cost of the Equipment.
2. Purchase Option Price. if Lessee has elected to exercise the
Purchase Option, then the "Purchase Option Price" shall be the Fair Market Value
(hereinafter defined) of the Equipment, provided, however, that the Purchase
Option Price shall not exceed 30% of the Acquisition Cost of the Equipment. As
soon as practicable following Lessor's receipt of the Option Notice, Lessor and
Lessee shall agree on the Fair Market Value of the Equipment as of the end of
the Lease Term. "Fair Market Value" of the Equipment shall be the amount
determined on the basis of, and equal in value to, the amount which would be
obtained in an arm's-length transaction between an informed and willing
buyer-user (other than a buyer-user currently in possession or a used equipment
or scrap dealer) and an informed and willing seller, under no compulsion to buy
or sell, and in such determination, costs of removal from the location of
current use shall not be a deduction from such value, and it shall be assumed
(whether or not the same be true) that the Equipment has been maintained and
would have been returned to Lessor in compliance with the requirements of the
Lease.
<PAGE>
If Lessor and Lessee fail to agree upon Fair Market Value on or before
one hundred sixty (160) days prior to the expiration of the Lease Term, then
such value shall be determined by the Appraisal Procedure (as set forth in
Section 3 below), at Lessee's sole cost and expense.
3. Appraisal Procedure. On the earlier of 160 days prior to the end of
the Lease Term or the date on which either party hereto shall have given written
notice to the other requesting determination of the Fair Market Value of the
Equipment by this Appraisal Procedure (the "Appraisal Notice"), the parties
shall consult for the purpose of appointing a qualified independent appraiser by
mutual agreement. If no such appraiser is so appointed within ten (10) business
days after the Appraisal Notice is given, each party shall appoint an
independent appraiser and the two appraisers shall attempt to jointly agree on
the Fair Market Value of the Equipment. If the two appraisers cannot so agree,
then the two appraisers so appointed shall appoint a third independent
appraiser. If the two appraisers have been unable to agree on the Fair Market
Value and on a third appraiser within thirty (30) days after the date of their
appointment, Lessor may apply to the American Society of Appraisers or the
American Arbitration Association to make such appointment, and both parties
shall be bound by any such appointment. Any appraiser or appraisers appointed
pursuant to this Appraisal Procedure shall be bound to determine the Fair Market
Value of the Equipment within thirty (30) days after the appointment of the
final appraiser to be employed pursuant to this Appraisal Procedure. If the
parties shall have appointed a single appraiser, his or her determination of
value shall be final, binding and conclusive on the parties. If the parties have
appointed two appraisers, then their jointly agreed determination of value shall
be final, binding and conclusive on the parties. If three appraisers shall be
appointed, the values determined by the three appraisers shall be averaged, the
appraisal having a value furthest from the average shall be discarded and the
remaining two appraised values shall be averaged, and the average of the
remaining two appraised values shall be final, binding and conclusive on the
parties.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: December 19, 1995
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
SCHEDULE A
Attached to and made part of the following: Bill of Sale
with OPTICAL COATING LABORATORY, INC.
- --------------------------------------------------------------------------------
QTY LOCATION, VENDOR, DESCRIPTION MODEL NO. SERIAL NO.
- --------------------------------------------------------------------------------
DEPRECIABLE TAX LIFE IS 7 YEARS.
LOCATION (01)
1 ROBOT SEAMING __________ _______________
2 ROBOT FSM SEAMERS __________ _______________
__________ _______________
1 CONVEYOR SYSTEM __________ _______________
AS MORE FULLY DESCRIBED ON THE FOLLOWING INVOICES:
INVOICE # INVOICE DATE VENDOR
- --------- ------------ ------
1-10317 7/27/94 SONOMA PRECISION MFG. CO.
9243 7/20/95 SEBASTOPOL BEARING & HYDRAULIC CO., INC.
053230 8/10/94 BILLCO MANUFACTURING, INC.
4072250 7/22/94 AIRSLED, INC.
00132784 7/19/94 DORNER MFG CORP
4325 7/26/94 BUSH MACHINE INC.
17418 9/20/94 MOTOMAN, INC.
15607 4/29/94 MOTOMAN, INC.
WITH ALL STANDARD AND ACCESSORY EQUIPMENT
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
BY: /s/ Lisa D. Wardle BY: /s/ John M. Markovich
------------------------------ ------------------------------
NAME: LISA D. WARDLE NAME: John M. Markovich
---------------------------- ----------------------------
TITLE: Assistant Vice President TITLE: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
SCHEDULE A-1
Attached to and made part of the following: Bill of Sale
with OPTICAL COATING LABORATORY, INC.
EQUIPMENT IS CURRENTLY LOCATED:
LOCATION (01)
2789 NORTH POINT PARKWAY
SANTA ROSA, CA 95407
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
BY: /s/ Lisa D. Wardle BY: /s/ John M. Markovich
------------------------------ ------------------------------
NAME: LISA D. WARDLE NAME: John M. Markovich
---------------------------- ----------------------------
TITLE: Assistant Vice President TITLE: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
EARLY PURCHASE OPTION RIDER
(single option)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Early Purchase Option Rider (the "Rider") is attached to and
made a part of that certain Lease Schedule No. 32053-02, dated as of February 8,
1996 (the "Lease Schedule"), by and between the undersigned parties.
So long as no Event of Default has occurred and is continuing under
the Lease, and upon at least 90 days prior written notice to Lessor, Lessee
shall have the right to terminate the Lease Term for all but not less than all
of the Equipment on the Rental Payment Date for Rental Payment Number 59 (the
"Termination Date"). Lessee shall pay to Lessor on the Termination Date an
amount equal to: (a) all Rental Payments, late charges and other amounts due and
owing under the Lease; plus (b) all taxes, assessments and other charges due or
payable in connection with the sale of the Equipment to Lessee; plus, (c) 43% of
the Acquisition Cost of the Equipment. If Lessee elects to exercise its option
under the terms of this Rider, it shall automatically be deemed that Lessee has
exercised its purchase option under and pursuant to the terms of the Early
Purchase Option Rider dated December 19, 1995 under that certain Lease Schedule
No. 32053-01 dated December 19, 1995.
Provided that Lessor shall have received (a) all amounts payable
hereunder and (b) all amounts payable under the Early Purchase Option Rider
applicable to Lease Schedule No. 32053-01 on the Termination Date, and that no
Event of Default then exists and is continuing under the Lease, Lessor shall
convey all of its right, title and interest in and to the Equipment to Lessee
on the Termination Date, on an "AS-IS", "WHERE-IS" BASIS WITHOUT REPRESENTATION
OR WARRANTY, EXPRESS OR IMPLIED, and without recourse to Lessor, except that the
Equipment shall be free and clear of all liens created by Lessor.
In the event Lessee shall not pay all amounts due hereunder on the
Termination Date, then the Lease Term for the Equipment shall continue in full
force and effect, and this Rider shall be null and void and of no further force
and effect.
All capitalized terms used herein and not defined herein shall have
the meanings set forth or referred to in the Lease Schedule. Except as
specifically set forth herein, all of the terms and conditions of the Lease
shall remain in full force and effect and are hereby ratified and affirmed. To
the extent that the provisions of this Rider conflict with any provisions
contained in the Lease, the provisions of this Rider shall control.
Dated as of: February 8, 1996
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
STIPULATED LOSS VALUE SCHEDULE
[LOGO]
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Stipulated Loss Value Schedule (the "Schedule") is attached to
and made a part of that certain Lease Schedule No. 32053-00002, dated as of
FEBRUARY 08, 1996 (the "Lease Schedule"), by and between the undersigned
parties.
The following Stipulated Loss Values shall be used to calculate
damages or loss as provided in the Master Lease. The Stipulated Loss Value with
respect to any item of Equipment on any Rental Payment Date during the Lease
Term shall be an amount equal to the sum of: (a) all Rental Payments and other
amounts then due and owing to Lessor under the Lease, together with all accrued
interest and late charges thereon, calculated through and including the date of
payment; plus (b) the product of the Acquisition Cost of the such Equipment
multiplied by the percentage as of such Rental Payment Date as set forth on the
reverse side hereof.
All capitalized terms used herein and not defined herein shall have
the meanings set forth or referred to in the Lease Schedule. Except as
specifically set forth herein, all of the terms and conditions of the Lease
shall remain in full force and effect and are hereby ratified and affirmed.
Dated as of: FEBRUARY 08, 1996
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: Name: John M. Markovich
---------------------------- ----------------------------
Title: Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
<TABLE>
<CAPTION>
Rental Payment Date for Percentage of Rental Payment Date for Percentage of
Rental Payment Number Acquisition Cost Rental Payment Number Acquisition Cost
- ----------------------- ---------------- ---------------------- ----------------
<S> <C> <C> <C>
1 103.68110252 37 77.00940904
2 103.08445807 38 75.83859334
3 102.48143380 39 74.65809606
4 101.87257133 40 73.46891506
5 101.25759862 41 72.27367045
6 100.63672963 42 71.06967042
7 100.00970627 43 69.85955233
8 99.37617349 44 68.63958497
9 98.75665420 45 67.41074200
10 98.09091201 46 66.17568968
11 97.43858054 47 64.93068171
12 96.78017115 48 63.67667640
13 96.11546948 49 62.41636928
14 95.44409762 50 61.14599876
15 94.76602712 51 59.86552190
16 94.08051541 52 58.57630769
17 93.38242052 53 57.28282470
18 92.67678668 54 55.98054114
19 91.95849572 55 54.67394077
20 91.2T530593 56 53.35707949
21 90.50044587 57 52.03130398
22 89.75482845 58 50.70112535
23 89.00219561 59 49.36058520
24 88.24175908 60 48.01101570
25 87.46846386 61 46.65695567
26 86.68803514 62 45.29243222
27 85.90044249 63 43.91740073
28 85.10575923 64 42.53498712
29 84.30250730 65 41.15703793
30 83.49208863 66 39.77169242
31 82.67304347 67 38.39080057
32 81.84666960 68 36.99933084
33 81.01301660 69 35.60039907
34 80.17065173 70 34.20587103
35 79.32085867 71 32.80070692
36 78.17058428 71 30.00000000
</TABLE>
<PAGE>
FLEET CREDIT CORPORATION
SCHEDULE A-1
Attached to and made part of the following: True Lease Schedule No. 32053-02,
Acceptance Certificate
with OPTICAL COATING LABORATORY, INC.
EQUIPMENT IS CURRENTLY LOCATED:
LOCATION (01)
2789 NORTH POINT PARKWAY
SANTA ROSA, CA 95407
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: BY: /s/ John M. Markovich
------------------------------ ------------------------------
Name: NAME: John M. Markovich
---------------------------- ----------------------------
Title: TITLE: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
[LOGO] ACCEPTANCE CERTIFICATE
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Acceptance Certificate is attached to and made a part of that certain
Lease Schedule No. 32053 - 00002, dated as of FEBRUARY 08, 1996 (the "Lease
Schedule"), by and between the undersigned parties. All capitalized terms used
herein and not defined herein shall have the meanings set forth or referred to
in the Lease Schedule. To the extent the terms set forth in this Acceptance
Certificate differ or conflict with any of the terms set forth in the Lease, the
terms set forth in this Acceptance Certificate shall control.
1. Lessee acknowledges and agrees that each item of Equipment set forth on
Schedule A hereto (collectively, the "Equipment") is hereby unconditionally
accepted by Lessee for all purposes under the Lease at the locations specified
in Schedule A-1 hereto, and hereby agrees to faithfully perform all of its
obligations under the Lease as of the date hereof (the "Acceptance Date").
Lessee hereby authorizes and directs Lessor to make payment to each vendor of
the Equipment pursuant to such vendor's invoice or any purchase order, purchase
agreement or supply contract with such vendor, receipt and approval of which are
hereby reaffirmed by Lessee.
2. By its execution and delivery of this Acceptance Certificate, Lessee
hereby reaffirms all of the representations, warranties and covenants contained
in the Lease as of the date hereof, and further represents and warrants to
Lessor that no Event of Default, and no event or condition which with notice or
the passage of time or both would constitute an Event of Default, has occurred
and is continuing as of the date hereof. Lessee further certifies to Lessor that
Lessee has selected the Equipment and has received and approved the purchase
order, purchase agreement or supply contract under which the Equipment will be
acquired for all purposes of the Lease.
3. Lessee hereby represents and warrants that: (a) the Equipment has been
delivered and is in an operating condition and performing the operation for
which it is intended to the satisfaction of the Lessee; and (b) if requested by
Lessor, the Equipment has been marked or labeled evidencing the Lessor's
interest therein.
4. The LEASE TERM COMMENCEMENT DATE is the 20th day of January, 1996.
5. The RENTAL PAYMENT COMMENCEMENT DATE is the 20th day of January, 1996.
6. All terms and provisions of the Lease Schedule shall remain in full
force and effect, except as otherwise provided below:
- ACQUISITION COST: $______________________.
- LEASE TERM: ______________________ months.
- RENTAL PAYMENTS: Number of Rental Payments Rental Payment Amount
- ADVANCE RENTAL PAYMENT(S): First______________ and last ______________.
- SECURITY DEPOSIT: ______________________ %.
Dated: 2/15/96
Agreed and Accepted:
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: Name: John M. Markovich
---------------------------- ----------------------------
Title: Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
FLEET CREDIT CORPORATION
SCHEDULE A
Attached to and made part of the following: True Lease Schedule No. 32053-02,
Acceptance Certificate, UCC Financing Statement(s)
with OPTICAL COATING LABORATORY, INC.
- --------------------------------------------------------------------------------
QTY LOCATION, VENDOR, DESCRIPTION MODEL NO. SERIAL NO.
- --------------------------------------------------------------------------------
DEPRECIABLE TAX LIFE IS 7 YEARS.
LOCATION (01)
1 ROBOT SEAMING __________ _______________
2 ROBOT FSM SEAMERS __________ _______________
__________ _______________
1 CONVEYOR SYSTEM __________ _______________
AS MORE FULLY DESCRIBED ON THE FOLLOWING INVOICES:
INVOICE # INVOICE DATE VENDOR
- --------- ------------ ------
1-10317 7/27/94 SONOMA PRECISION MFG. CO.
9243 7/20/95 SEBASTOPOL BEARING & HYDRAULIC CO., INC.
053230 8/10/94 BILLCO MANUFACTURING, INC.
4072250 7/22/94 AIRSLED, INC.
00132784 7/19/94 DORNER MFG CORP
4325 7/26/94 BUSH MACHINE INC.
17418 9/20/94 MOTOMAN, INC.
15607 4/29/94 MOTOMAN, INC.
WITH ALL STANDARD AND ACCESSORY EQUIPMENT
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: BY: /s/ John M. Markovich
------------------------------ ------------------------------
Name: NAME: John M. Markovich
---------------------------- ----------------------------
Title: TITLE: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
4. EQUIPMENT LOCATION(S). The Equipment will be located at the
location(s) specified in Schedule A-1 hereto.
5. Lessor will invoice Lessee for all sales, use and/or personal
property taxes as and when due and payable in accordance with applicable law,
unless Lessee delivers to Lessor a valid exemption certificate with respect to
such taxes. Delivery of such certificate shall constitute Lessee's
representation and warranty that no such taxes shall become due and payable with
respect to the Equipment, and Lessee shall indemnify and hold harmless Lessor
from and against any and all liability or damages, including late charges and
interest which Lessor may incur by reason of the assessment of such taxes.
6. The Rental Payments may change for Equipment accepted after
FEBRUARY 24, 1996.
Dated as of: FEBRUARY 08, 1996
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: Name: John M. Markovich
---------------------------- ----------------------------
Title: Title: Vice President Finance and
--------------------------- ---------------------------
Chief Financial Officer
<PAGE>
[LOGO]
Fleet Credit Corporation
January 22, 1996
Mr. Jeff Ryan, Assistant Treasurer
OPTICAL COATING LABORATORY, INC.
2789 North Point Parkway
Santa Rosa, CA 95407
RE: Optical Coating Laboratory, Inc. 32053-01
Dear Mr. Ryan:
I would like to take this opportunity to thank you for working with
Fleet Credit Corporation on your recent financing requirements.
Enclosed, for your files, are copies of the executed documents for the
above referenced transaction. The invoices will be mailed to the above listed
address. If invoices should be mailed to another address or another individual
within your organization, please contact our Customer Service Department at
(800) 238-3737.
Again, thank you for your business. Please feel free to call me at (401)
278-6359 should you have any questions or if I can be of any further service to
you.
Very truly yours,
/s/ Vanessa Wilson/kew
Vanessa Wilson
Contract Administrator I
/kew
enclosures
Fleet Credit Corporation 5th Floor, 50 Kennedy Plaza, Providence, RI02903-2305
401-278-5593
A Member of Fleet Financial Group, Inc.
<PAGE>
FLEET CREDIT CORPORATION MASTER EQUIPMENT LEASE AGREEMENT No. 32053
LESSOR: FLEET CREDIT CORPORATION LESSEE: OPTICAL COATING LABORATORY, INC.
a Rhode Island corporation a Delaware corporation
Address: 50 Kennedy Plaza Address: 2789 North Point Parkway
Providence, Rhode Island 02903-2305 Santa Rosa, CA 95407
1. LEASE OF EQUIPMENT
Subject to the terms and conditions set forth herein (the "Master Lease")
and in any Lease Schedule incorporating the terms of this Master Lease (each, a
"Lease Schedule"), Lessor agrees to lease to Lessee, and Lessee agrees to lease
from Lessor, the items and units of personal property described in each such
Lease Schedule, together with all replacements, parts, additions, accessories
and substitutions therefor (collectively, the "Equipment"). Each Lease Schedule
shall constitute a separate, distinct and independent lease of Equipment and
contractual obligation of Lessee. References to "the Lease", "this Lease" or
"any Lease" shall mean and refer to any Lease Schedule which incorporates the
terms of this Master Lease, together with all exhibits, addenda, schedules,
certificates, riders and other documents and instruments executed and delivered
in connection with such Lease Schedule or this Master Lease, all as the same may
be amended or modified from time to time. The Equipment is to be delivered and
installed at the location specified or referred to in the applicable Lease
Schedule. The Equipment shall be deemed to have been accepted by Lessee for all
purposes under this Lease upon Lessor's receipt of an Acceptance Certificate
with respect to such Equipment, executed by Lessee after receipt of all other
documentation required by Lessor with respect to such Equipment. Lessor shall
not be liable or responsible for any failure or delay in the delivery of the
Equipment to Lessee for whatever reason. As used in the Lease with respect to
any item of Equipment, the terms "Acceptance Date", "Acquisition Cost", "Rental
Payment(s)", "Rental Payment Date(s)", "Rental Payment Numbers", "Rental Payment
Commencement Date", "Lease Term" and "Lease Term Commencement Date" shall have
the meanings and values assigned to them in the Lease Schedule and the
Acceptance Certificate applicable to such Equipment.
2. TERM AND RENT
The Lease Term for each item of Equipment shall be as specified in the
applicable Lease Schedule. Rental Payments shall be in the amounts and shall be
due and payable as set forth in the applicable Lease Schedule. Lessee shall, in
addition, pay interim rent to Lessor on a pro-rata, per-diem basis from the
Acceptance Date to the Lease Term Commencement Date set forth in the applicable
Acceptance Certificate, payable on such Lease Term Commencement Date. If any
rent or other amount payable hereunder shall not be paid within 10 days of the
date when due, Lessee shall pay as an administrative and late charge an amount
equal to 5% of the amount of any such overdue payment. In addition, Lessee shall
pay overdue interest on any delinquent payment or other amounts due under the
Lease (by reason of acceleration or otherwise) from 30 days after the due date
until paid at the rate of 1 1/2% per month or the maximum amount permitted by
applicable law, whichever is lower. All payments to be made to Lessor shall be
made to Lessor in immediately available funds at the address shown above, or at
such other place as Lessor shall specify in writing. THIS IS A NON-CANCELABLE,
NON-TERMINABLE LEASE OF EQUIPMENT FOR THE ENTIRE LEASE TERM PROVIDED IN EACH
LEASE SCHEDULE HERETO.
3. POSSESSION; PERSONAL PROPERTY
No right, title or interest in the Equipment shall pass to Lessee other than
the right to maintain possession and use of the Equipment for the Lease Term
(provided no Event of Default has occurred) free from interference by any person
claiming by, through, or under Lessor. The Equipment shall always remain
personal property even though the Equipment may hereafter become attached or
affixed to real property. Lessee agrees to give and record such notices and to
take such other action at its own expense as may be necessary to prevent any
third party (other than an assignee of Lessor) from acquiring or having the
right under any circumstances to acquire any interest in the Equipment or this
Lease.
4. DISCLAIMER OF WARRANTIES
LESSOR IS NOT THE MANUFACTURER OR SUPPLIER OF THE EQUIPMENT, NOR THE AGENT
THEREOF, AND MAKES NO EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES AS TO ANY
MATTER WHATSOEVER, INCLUDING WITHOUT LIMITATION, THE MERCHANTABILITY OF THE
EQUIPMENT, ITS FITNESS FOR A PARTICULAR PURPOSE, ITS DESIGN OR CONDITION, ITS
CAPACITY OR DURABILITY, THE QUALITY OF THE MATERIAL OR WORKMANSHIP IN THE
MANUFACTURE OR ASSEMBLY OF THE EQUIPMENT, OR THE CONFORMITY OF THE EQUIPMENT TO
THE PROVISIONS AND SPECIFICATIONS OF ANY PURCHASE ORDER RELATING THERETO, OR
PATENT INFRINGEMENTS, AND LESSOR HEREBY DISCLAIMS ANY SUCH WARRANTY. LESSOR IS
NOT RESPONSIBLE FOR ANY REPAIRS OR SERVICE TO THE EQUIPMENT, DEFECTS THEREIN OR
FAILURES IN THE OPERATION THEREOF. Lessee has made the selection of each item of
Equipment and the manufacturer and/or supplier thereof based on its own judgment
and expressly disclaims any reliance upon any statements or representations made
by Lessor. For so long as no Event of Default (or event or condition which, with
the passage of time or giving of notice, or both, would become such an Event of
Default) has occurred and is continuing, Lessee shall be the beneficiary of, and
shall be entitled to, all rights under any applicable manufacturer's or vendor's
warranties with respect to the Equipment, to the extent permitted by law.
If the Equipment is not delivered, is not properly installed, does not
operate as warranted, becomes obsolete, or is unsatisfactory for any reason
whatsoever, Lessee shall make all claims on account thereof solely against the
manufacturer or supplier and not against Lessor, and Lessee shall nevertheless
pay all rentals and other sums payable hereunder. Lessee acknowledges that
neither the manufacturer or supplier of the Equipment, nor any sales
representative or agent thereof, is an agent of Lessor, and no agreement or
representation as to the Equipment or any other matter by any such sales
representative or agent of the manufacturer or supplier shall in any way affect
Lessee's obligations hereunder.
5. REPRESENTATIONS, WARRANTIES AND COVENANTS
Lessee represents and warrants to and covenants with Lessor that:
(a) Lessee has the form of business organization indicated above and is duly
organized and existing in good standing under the laws of the state listed in
the caption of this Master Lease and is duly qualified to do business wherever
necessary to carry on its present business and operations and to own its
property; (b) this Lease has been duly authorized by all necessary action on the
part of Lessee consistent with its form of organization, does not require any
further shareholder or partner approval, does not require the approval of, or
the giving notice to, any federal, state, local or foreign governmental
authority and does not contravene any law binding on Lessee or contravene any
certificate or articles of incorporation or by-laws or partnership certificate
or agreement, or any agreement, indenture, or other instrument to which Lessee
is a party or by which it may be bound; (c) this Lease has been duly executed
and delivered by authorized officers or partners of Lessee and constitutes a
legal, valid and binding obligation of Lessee enforceable in accordance with its
terms; (d) Lessee has not and will not, directly or indirectly, create, incur or
permit to exist any lien, encumbrance, mortgage, pledge, attachment or security
interest on or with respect to the Equipment or this Lease (except those of
persons claiming by, through or under Lessor); (e) the Equipment will be used
solely in the conduct of Lessee's business and will remain in the location shown
on the applicable Lease Schedule unless Lessor otherwise agrees in writing and
Lessee has completed all notifications, filings, recordings and other actions in
such new location as Lessor may reasonably request to protect Lessor's interest
in the Equipment; (f) there are no pending or threatened actions or proceedings
before any court or administrative agency which materially adversely affect
Lessee's financial condition or operations, and all credit, financial and other
information provided by Lessee or at Lessee's direction is, and all such
information hereafter furnished will be, true, correct and complete in all
material respects; (g) Lessor has not selected, manufactured or supplied the
Equipment to Lessee and has acquired any Equipment subject hereto solely in
connection with this Lease and Lessee has received and approved the terms of any
purchase order or agreement with respect to the Equipment; (h) Lessee shall not,
as of the end of each of Lessee's fiscal quarters, permit, on a consolidated
basis, its Tangible Net Worth (hereinafter defined) to be less than $40,000,000
plus 50% of the consolidated net income, after income taxes (but without giving
effect to any net losses) earned in any quarterly accounting period commencing
after October 31, 1994; (i) Lessee shall not permit, on a consolidated basis,
the ratio of its current assets to current liabilities to be less than 1.0:1.0;
(j) Lessee will furnish to Lessor, within 45 days of the end of each fiscal
quarter of Lessee, a Compliance Certificate, substantially in the form of
Exhibit A hereto, certified by Lessee's chief financial officer, treasurer or
any other officer having substantially the same authority and responsibility, as
to the compliance with the financial covenants contained herein; and (k) Lessee
is not insolvent within the meaning of any applicable state or Federal laws. The
sale of the Equipment by Lessee to Lessor and Lessee's undertaking of the
obligations contained herein shall not cause Lessee to be insolvent within the
meaning of applicable state and/or Federal laws. The payment by Lessor to Lessee
of the Acquisition Cost of the Equipment, as set forth from time to time on the
Acceptance Certificate, is fair consideration for each Item of Equipment within
the meaning of applicable state and Federal laws.
<PAGE>
FLEET CREDIT CORPORATION MASTER EQUIPMENT LEASE AGREEMENT No. 32053
LESSOR: FLEET CREDIT CORPORATION LESSEE: OPTICAL COATING LABORATORY, INC.
a Rhode Island corporation a Delaware corporation
Address: 50 Kennedy Plaza Address: 2789 North Point Parkway
Providence, Rhode Island 02903-2305 Santa Rosa, CA 95407
1. LEASE OF EQUIPMENT
Subject to the terms and conditions set forth herein (the "Master Lease")
and in any Lease Schedule incorporating the terms of this Master Lease (each, a
"Lease Schedule"), Lessor agrees to lease to Lessee, and Lessee agrees to lease
from Lessor, the items and units of personal property described in each such
Lease Schedule, together with all replacements, parts, additions, accessories
and substitutions therefor (collectively, the "Equipment") Each Lease Schedule
shall constitute a separate, distinct and independent lease of Equipment and
contractual obligation of Lessee. References to "the Lease", "this Lease" or
"any Lease" shall mean and refer to any Lease Schedule which incorporates the
terms of this Master Lease, together with all exhibits, addenda, schedules,
certificates, riders and other documents and instruments executed and delivered
in connection with such Lease Schedule or this Master Lease, all as the same may
be amended or modified from time to time. The Equipment is to be delivered and
installed at the location specified or referred to in the applicable Lease
Schedule. The Equipment shall be deemed to have been accepted by Lessee for all
purposes under this Lease upon Lessor's receipt of an Acceptance Certificate
with respect to such Equipment, executed by Lessee after receipt of all other
documentation required by Lessor with respect to such Equipment. Lessor shall
not be liable or responsible for any failure or delay in the delivery of the
Equipment to Lessee for whatever reason. As used in the Lease with respect to
any item of Equipment, the terms "Acceptance Date", "Acquisition Cost", "Rental
Payment(s)", "Rental Payment Date(s)", "Rental Payment Numbers", "Rental Payment
Commencement Date", "Lease Term" and "Lease Term Commencement Date" shall have
the meanings and values assigned to them in the Lease Schedule and the
Acceptance Certificate applicable to such Equipment.
2. TERM AND RENT
The Lease Term for each item of Equipment shall be as specified in the
applicable Lease Schedule. Rental Payments shall be in the amounts and shall be
due and payable as set forth in the applicable Lease Schedule. Lessee shall, in
addition, pay interim rent to Lessor on a pro-rata, per-diem basis from the
Acceptance Date to the Lease Term Commencement Date set forth in the applicable
Acceptance Certificate, payable on such Lease Term Commencement Date. If any
rent or other amount payable hereunder shall not be paid within 10 days of the
date when due, Lessee shall pay as an administrative and late charge an amount
equal to 5% of the amount of any such overdue payment. In addition, Lessee shall
pay overdue interest on any delinquent payment or other amounts due under the
Lease (by reason of acceleration or otherwise) from 30 days after the due date
until paid at the rate of 1 1/2% per month or the maximum amount permitted by
applicable law, whichever is lower. All payments to be made to Lessor shall be
made to Lessor in immediately available funds at the address shown above, or at
such other place as Lessor shall specify in writing. THIS IS A NON-CANCELABLE,
NON-TERMINABLE LEASE OF EQUIPMENT FOR THE ENTIRE LEASE TERM PROVIDED IN EACH
LEASE SCHEDULE HERETO.
3. POSSESSION; PERSONAL PROPERTY
No right, title or interest in the Equipment shall pass to Lessee other than
the right to maintain possession and use of the Equipment for the Lease Term
(provided no Event of Default has occurred) free from interference by any person
claiming by, through, or under Lessor. The Equipment shall always remain
personal property even though the Equipment may hereafter become attached or
affixed to real property. Lessee agrees to give and record such notices and to
take such other action at its own expense as may be necessary to prevent any
third party (other than an assignee of Lessor) from acquiring or having the
right under any circumstances to acquire any interest in the Equipment or this
Lease.
4. DISCLAIMER OF WARRANTIES
LESSOR IS NOT THE MANUFACTURER OR SUPPLIER OF THE EQUIPMENT, NOR THE AGENT
THEREOF, AND MAKES NO EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES AS TO ANY
MATTER WHATSOEVER, INCLUDING WITHOUT LIMITATION, THE MERCHANTABILITY OF THE
EQUIPMENT, ITS FITNESS FOR A PARTICULAR PURPOSE, ITS DESIGN OR CONDITION, ITS
CAPACITY OR DURABILITY, THE QUALITY OF THE MATERIAL OR WORKMANSHIP IN THE
MANUFACTURE OR ASSEMBLY OF THE EQUIPMENT, OR THE CONFORMITY OF THE EQUIPMENT TO
THE PROVISIONS AND SPECIFICATIONS OF ANY PURCHASE ORDER RELATING THERETO, OR
PATENT INFRINGEMENTS, AND LESSOR HEREBY DISCLAIMS ANY SUCH WARRANTY. LESSOR IS
NOT RESPONSIBLE FOR ANY REPAIRS OR SERVICE TO THE EQUIPMENT, DEFECTS THEREIN OR
FAILURES IN THE OPERATION THEREOF. Lessee has made the selection of each item of
Equipment and the manufacturer and/or supplier thereof based on its own judgment
and expressly disclaims any reliance upon any statements or representations made
by Lessor. For so long as no Event of Default (or event or condition which, with
the passage of time or giving of notice, or both, would become such an Event of
Default) has occurred and is continuing, Lessee shall be the beneficiary of, and
shall be entitled to, all rights under any applicable manufacturer's or vendor's
warranties with respect to the Equipment, to the extent permitted by law.
If the Equipment is not delivered, is not properly installed, does not
operate as warranted, becomes obsolete, or is unsatisfactory for any reason
whatsoever, Lessee shall make all claims on account thereof solely against the
manufacturer or supplier and not against Lessor, and Lessee shall nevertheless
pay all rentals and other sums payable hereunder. Lessee acknowledges that
neither the manufacturer or supplier of the Equipment, nor any sales
representative or agent thereof, is an agent of Lessor, and no agreement or
representation as to the Equipment or any other matter by any such sales
representative or agent of the manufacturer or supplier shall in any way affect
Lessee's obligations hereunder.
5. REPRESENTATIONS, WARRANTIES AND COVENANTS
Lessee represents and warrants to and covenants with Lessor that:
(a) Lessee has the form of business organization indicated above and is duly
organized and existing in good standing under the laws of the state listed in
the caption of this Master Lease and is duly qualified to do business wherever
necessary to carry on its present business and operations and to own its
property; (b) this Lease has been duly authorized by all necessary action on the
part of Lessee consistent with its form of organization, does not require any
further shareholder or partner approval, does not require the approval of, or
the giving notice to, any federal, state, local or foreign governmental
authority and does not contravene any law binding on Lessee or contravene any
certificate or articles of incorporation or by-laws or partnership certificate
or agreement, or any agreement, indenture, or other instrument to which Lessee
is a party or by which it may be bound; (c) this Lease has been duly executed
and delivered by authorized officers or partners of Lessee and constitutes a
legal, valid and binding obligation of Lessee enforceable in accordance with its
terms; (d) Lessee has not and will not, directly or indirectly, create, incur or
permit to exist any lien, encumbrance, mortgage, pledge, attachment or security
interest on or with respect to the Equipment or this Lease (except those of
persons claiming by, through or under Lessor); (e) the Equipment will be used
solely in the conduct of Lessee's business and will remain in the location shown
on the applicable Lease Schedule unless Lessor otherwise agrees in writing and
Lessee has completed all notifications, filings, recordings and other actions in
such new location as Lessor may reasonably request to protect Lessor's interest
in the Equipment; (f) there are no pending or threatened actions or proceedings
before any court or administrative agency which materially adversely affect
Lessee's financial condition or operations, and all credit, financial and other
information provided by Lessee or at Lessee's direction is, and all such
information hereafter furnished will be, true, correct and complete in all
material respects; (g) Lessor has not selected, manufactured or supplied the
Equipment to Lessee and has acquired any Equipment subject hereto solely in
connection with this Lease and Lessee has received and approved the terms of any
purchase order or agreement with respect to the Equipment; (h) Lessee shall not,
as of the end of each of Lessee's fiscal quarters, permit, on a consolidated
basis, its Tangible Net Worth (hereinafter defined) to be less than $40,000,000
plus 50% of the consolidated net income, after income taxes (but without giving
effect to any net losses) earned in any quarterly accounting period commencing
after October 31, 1994; (i) Lessee shall not permit, on a consolidated basis,
the ratio of its current assets to current liabilities to be less than 1.0:1.0;
(j) Lessee will furnish to Lessor, within 45 days of the end of each fiscal
quarter of Lessee, a Compliance Certificate, substantially in the form of
Exhibit A hereto, certified by Lessee's chief financial officer, treasurer or
any other officer having substantially the same authority and responsibility, as
to the compliance with the financial covenants contained herein; and (k) Lessee
is not insolvent within the meaning of any applicable state or Federal laws. The
sale of the Equipment by Lessee to Lessor and Lessee's undertaking of the
obligations contained herein shall not cause Lessee to be insolvent within the
meaning of applicable state and/or Federal laws. The payment by Lessor to Lessee
of the Acquisition Cost of the Equipment, as set forth from time to time on the
Acceptance Certificate, is fair consideration for each Item of Equipment within
the meaning of applicable state and Federal laws.
<PAGE>
9. REMEDIES
Upon the occurrence of any Event of Default, Lessor may, at its sole option
and discretion, exercise one or more of the following remedies with respect to
any or all of the Equipment: (a) cause Lessee to promptly return, at Lessee's
expense, any or all Equipment to such location as Lessor may designate in
accordance with the terms of Section 18 of this Master Lease, or Lessor, at its
option, may enter upon the premises where the Equipment is located and take
immediate possession of and remove the same by summary proceedings or otherwise,
all without liability to Lessor for or by reason of damage to property or such
entry or taking possession except for Lessor's gross negligence or willful
misconduct; (b) sell any or all Equipment at public or private sale or otherwise
dispose of, hold, use, operate, lease to others or keep idle the Equipment, all
as Lessor in its sole discretion may determine and all free and clear of any
rights of Lessee; (c) remedy such default, including making repairs or
modifications to the Equipment, for the account and expense of Lessee, and
Lessee agrees to reimburse Lessor for all of Lessor's costs and expenses; (d) by
written notice to Lessee, terminate the Lease with respect to any or all Lease
Schedules and the Equipment subject thereto, as such notice shall specify, and,
with respect to such terminated Lease Schedules and Equipment, declare
immediately due and payable and recover from Lessee, as liquidated damages for
loss of Lessor's bargain and not as a penalty, an amount equal to the Stipulated
Loss Value, calculated as of the next following Rental Payment Date; (e) apply
any deposit or other cash collateral or sale or remarketing proceeds of the
Equipment at any time to reduce any amounts due to Lessor, and (f) exercise any
other right or remedy which may be available to Lessor under applicable law, or
proceed by appropriate court action to enforce the terms hereof or to recover
damages for the breach hereof, including reasonable attorneys' fees and court
costs. No remedy referred to in this Section 9 shall be exclusive, but each
shall be cumulative and in addition to any other remedy referred to above or
otherwise available to Lessor at law or in equity.
The exercise or pursuit by Lessor of any one or more of such remedies shall
not preclude the simultaneous or later exercise or pursuit by Lessor of any or
all such other remedies, and all remedies hereunder shall survive termination of
this Lease. At any sale of the Equipment pursuant to this Section 9, Lessor may
bid for the Equipment. Notice required, if any, of any sale or other disposition
hereunder by Lessor shall be satisfied by the mailing of such notice to Lessee
at least seven (7) days prior to such sale or other disposition. In the event
Lessor takes possession and disposes of the Equipment, the proceeds of any such
disposition shall be applied in the following order: (1) to all of Lessor's
costs, charges and expenses incurred in taking, removing, holding, repairing and
selling or leasing the Equipment; (2) to the extent not previously paid by
Lessee, to pay Lessor for any damages then remaining unpaid hereunder; (3) to
reimburse Lessee for any sums previously paid by Lessee as damages hereunder;
and (4) the balance, if any, shall be retained by Lessor. A termination shall
occur only upon written notice by Lessor and only with respect to such Equipment
as Lessor shall specify in such notice. Termination under this Section 9 shall
not affect Lessee's duty to perform Lessee's obligations hereunder to Lessor in
full. Lessee agrees to reimburse Lessor on demand for any and all costs and
expenses incurred by Lessor in enforcing its rights and remedies hereunder
following the occurrence of an Event of Default, including, without limitation,
reasonable attorney's fees, and the costs of repossession, storage, insuring,
reletting, selling and disposing of any and all Equipment.
The term "Stipulated Loss Value" with respect to any item of Equipment shall
mean the Stipulated Loss Value as set forth in any Schedule of Stipulated Loss
Values attached to and made a part of the applicable Lease Schedule. If there is
no such Schedule of Stipulated Loss Values, then the Stipulated Loss Value with
respect to any item of Equipment on any Rental Payment Date during the Lease
Term shall be an amount equal to the sum of: (a) all Rental Payments and other
amounts then due and owing to Lessor under the Lease, together with all accrued
interest and late charges thereon calculated through and including the date of
payment; plus (b) the net present value of: (i) all Rental Payments then
remaining unpaid for the Lease Term, plus (ii) the amount of any purchase
obligation with respect to the Equipment or, if there is no such obligation,
then the fair market value of the Equipment at the end of such term, as
estimated by Lessor in its sole discretion, all discounted to net present value
at a discount rate equal to the 1-year Treasury Constant Maturity rate as
published in the Selected Interest Rates table of the Federal Reserve
statistical release H.15(519) for the week ending immediately prior to the
original Acceptance Date for such Equipment.
10. ADDITIONAL SECURITY
For so long as any obligations of Lessee shall remain outstanding under any
Lease, Lessee hereby grants to Lessor a security interest in all of Lessee's
rights in and to Equipment subject to such Lease from time to time, to secure
the prompt payment and performance when due (by reason of acceleration or
otherwise) of each and every indebtedness, obligation or liability of Lessee, or
any affiliated person, firm, or entity controlling, controlled by, or under
common control with Lessee, owing to Lessor, whether now existing or hereafter
arising, including but not limited to all of such obligations under or in
respect of any Lease. The extent to which Lessor shall have a purchase money
security interest in any item of Equipment under a Lease which is deemed to
create a security interest under Section 1-201(37) of the Uniform Commercial
Code shall be determined by reference to the Acquisition Cost of such item
financed by Lessor. In order more fully to secure its rental payments and all
other obligations to Lessor hereunder, Lessee hereby grants to Lessor a security
interest in any deposit of Lessee to Lessor under Section 3(d) of any Lease
Schedule hereto. Such security deposit shall not bear interest, may be
commingled with other funds of Lessor and shall be immediately restored by
Lessee if applied under Section 9. Upon expiration of the term of this Lease and
satisfaction of all of Lessee's obligations, the security deposit shall be
returned to Lessee. The term "Lessor" as used in this Section 10 shall include
any affiliated person, firm or entity controlling, controlled by or under common
control with Lessor.
11. NOTICES
Any notices or demands required or permitted to be given under this Lease
shall be given in writing and either (i) by regular mail, by hand or by
overnight courier, which notice shall become effective when received, or (ii) by
facsimile or other form of electronic transmission, which notice shall become
effective upon transmission thereof, such notice shall be addressed to Lessor to
the attention of Customer Accounts, and to Lessee at the address set forth
above, or to such other address as the party to receive notice hereafter
designates by such written notice.
12. USE; MAINTENANCE; INSPECTION; LOSS AND DAMAGE
During the Lease Term for each item of Equipment, Lessee shall, unless
Lessor shall otherwise consent in writing: (a) permit each item of Equipment to
be used only within the continental United States by qualified personnel solely
for business purposes and the purpose for which it was designed and shall, at
its sole expense, service, repair, overhaul and maintain each item of Equipment
in the same condition as when received, ordinary wear and tear excepted, in good
operating order, consistent with prudent industry practice (but, in no event
less than the same extent to which Lessee maintains other similar equipment in
the prudent management of its assets and properties) and in compliance with all
applicable laws, ordinances, regulations, and conditions of all insurance
policies required to be maintained by Lessee under the Lease and all manuals,
orders, recommendations, instructions and other written requirements as to the
repair and maintenance of such item of Equipment issued at any time by the
vendor and/or manufacturer thereof; (b) maintain conspicuously on each item of
Equipment such labels, plates, decals or other markings as Lessor may reasonably
require, stating that Lessor is owner of such item of Equipment; (c) furnish to
Lessor such information concerning the condition, location, use and operation of
the Equipment as Lessor may request; (d) upon reasonable advance notice, permit
any person designated by Lessor to visit and inspect, during normal business
hours, any item of Equipment and any records maintained in connection therewith,
provided, however, that the failure of Lessor to inspect the Equipment or to
inform Lessee of any noncompliance shall not relieve Lessee of any of its
obligations hereunder; (e) if any item of Equipment does not comply with the
requirements of this Lease, Lessee shall, within 30 days of written notice from
Lessor, bring such Equipment into compliance; (f) not use any Equipment, nor
allow the same to be used, for any unlawful purpose, nor in connection with any
property or material that would subject the Lessor to any liability under any
state or federal statute or regulation pertaining to the production, transport,
storage, disposal or discharge of hazardous or toxic waste or materials; and (g)
make no additions, alterations, modifications or improvements (collectively,
"Improvements") to any item of Equipment that are not readily removable without
causing material damage to such item of Equipment or which will cause the value,
utility or useful life of such item of Equipment to materially decline. If any
such Improvement is made and cannot be removed without causing material damage
or decline in value, utility or useful life (a "Non-Severable Improvement"),
then Lessee warrants that such Non-Severable Improvement shall immediately
become Lessor's property upon being installed and shall be free and clear of all
liens and encumbrances and shall become Equipment subject to all of the terms
and conditions of the Lease. All such Improvements that are not Non-Severable
Improvements shall be removed by Lessee prior to the return of the item of
Equipment hereunder or such Improvements shall also become the sole and absolute
property of Lessor without any further payment by Lessor to Lessee and shall be
free and clear of all liens and encumbrances whatsoever. Lessee shall repair all
damage to any item of Equipment caused by the removal of any Improvement so as
to restore such item of Equipment to the same condition which existed prior to
its installation and as required by this Lease.
Lessee hereby assumes all risk of loss, damage or destruction for whatever
reason to the Equipment from and after the earlier of the date (i) on which the
Equipment is ordered or (ii) Lessor pays the purchase price of the Equipment,
and continuing until the Equipment has been returned to, and accepted by, Lessor
in the condition required by Section 18 hereof upon the expiration of the Lease
Term. If during the Lease Term any item of Equipment shall become lost, stolen,
destroyed, damaged beyond repair or rendered permanently unfit for use for any
reason, or in the event of any condemnation, confiscation, theft or seizure or
requisition of title to or use of such item, Lessee shall immediately pay to
Lessor an amount equal to the Stipulated Loss Value of such item, as of the next
following Rental Payment Date.
<PAGE>
13. INSURANCE
Lessee shall procure and maintain insurance in such amounts and upon such
terms and with such companies as Lessor may approve, during the entire Lease
Term and until the Equipment has been returned to, and accepted by, Lessor in
the condition required by Section 18 hereof, at Lessee's expense, provided that
in no event shall such insurance be less than the following coverages and
amounts: (a) Worker's Compensation and Employer's Liability Insurance, in the
full statutory amounts provided by law; (b) Comprehensive General Liability
Insurance including product/completed operations and contractual liability
coverage, with minimum limits of $1,000,000 each occurrence, and Combined Single
Limit Body Injury and Property Damage, $1,000,000 aggregate, where applicable;
and (c) All Risk Physical Damage Insurance, including earthquake and flood, on
each item of Equipment, in an amount not less than the greater of the Stipulated
Loss Value of the Equipment or (if available) its full replacement value. Lessor
will be included as an additional insured and loss payee as its interest may
appear. Such policies shall be endorsed to provide that the coverage afforded to
Lessor shall not be rescinded, impaired or invalidated by any act or neglect of
Lessee. Lessee agrees to waive Lessee's right and its insurance carrier's rights
of subrogation against Lessor for any and all loss or damage.
Notwithstanding the foregoing, Lessee shall not be required to maintain
earthquake insurance in an amount in excess of the lesser of the Acquisition
Cost or the then current Stipulated Loss Value with a ten percent (10%)
deductible.
In addition to the foregoing minimum insurance coverage, Lessee shall
procure and maintain such other insurance coverage as Lessor may reasonably
require in good faith from time to time during the Lease Term. All policies
shall be endorsed or contain a clause requiring the insurer to furnish Lessor
with at least 30 days' prior written notice of any material change, cancellation
or non-renewal of coverage. Upon execution of this Lease, Lessee shall furnish
Lessor with a certificate of insurance or other evidence satisfactory to Lessor
that such insurance coverage is in effect, provided, however, that Lessor shall
be under no duty either to ascertain the existence of or to examine such
insurance coverage or to advise Lessee in the event such insurance coverage
should not comply with the requirements hereof. In case of failure of Lessee to
procure or maintain insurance, Lessor may at its option obtain such insurance,
the cost of which will be paid by the Lessee as additional rentals. Lessee
hereby irrevocably appoints Lessor as Lessee's attorney-in-fact to file, settle
or adjust, and receive payment of claims under any such insurance policy and to
endorse Lessee's name on any checks, drafts or other instruments on payment of
such claims. Lessee further agrees to give Lessor prompt notice of any damage to
or loss of, the Equipment, or any part thereof.
14. LIMITATION OF LIABILITY
Lessor shall have no liability in connection with or arising out of the
ownership, leasing, furnishing, performance or use of the Equipment or any
special, indirect, incidental or consequential damages of any character,
including, without limitation, loss of use of production facilities or
equipment, loss of profits, property damage or lost production, whether suffered
by Lessee or any third party.
15. FURTHER ASSURANCES
Lessee shall promptly execute and deliver to Lessor such further documents
and take such further action as Lessor may reasonably require in good faith, in
order to more effectively carry out the intent and purpose of this Lease. Lessee
shall provide to Lessor, within 120 days after the close of each of Lessee's
fiscal years, and, upon Lessor's request, within 45 days of the end of each
quarter of Lessee's fiscal year, a copy of its financial statements prepared in
accordance with generally accepted accounting principles and, in the case of
annual financial statements, audited by independent certified public
accountants, and in the case of quarterly financial statements certified by
Lessee's chief financial officer. Lessee shall execute and deliver to Lessor
upon Lessor's request such instruments and assurances as Lessor deems necessary
for the confirmation, preservation or perfection of this Lease and Lessor's
rights hereunder, including, without limitation, such corporate resolutions and
opinions of counsel as Lessor may request from time to time, and all schedules,
forms and other reports as may be required to satisfy obligations imposed by
taxing authorities. In furtherance thereof, Lessor may file or record this Lease
or a memorandum or a photocopy hereof (which for the purposes hereof shall be
effective as a financing statement) so as to give notice to third parties, and
Lessee hereby appoints Lessor as its attorney-in-fact to execute, sign, file and
record UCC financing statements and other lien recordation documents with
respect to the Equipment where Lessee fails or refuses to do so after Lessor's
written request, and Lessee agrees to pay or reimburse Lessor for any filing,
recording or stamp fees or taxes arising from any such filings.
16. ASSIGNMENT
This Lease and all rights of Lessor hereunder shall be assignable by Lessor
absolutely or as security, without notice to Lessee, subject to the rights of
Lessee hereunder for the use and possession of the Equipment for so long as no
Event of Default has occurred and is continuing hereunder. Any such assignment
shall not relieve Lessor of its obligations hereunder unless specifically
assumed by the assignee, and Lessee agrees it shall not assert any defense,
rights of set-off or counterclaim against any assignee to which Lessor shall
have assigned its rights and interests hereunder, nor hold or attempt to hold
such assignee liable for any of Lessor's obligations hereunder. No such
assignment shall materially increase Lessee's obligations hereunder. Lessee
agrees, upon Lessor's written request, to provide to any such assignee an
acknowledgment of such assignment confirming the terms, conditions,
representations, warranties and covenants contained in this Lease.
Notwithstanding the foregoing, provided no Event of Default or event, which
with the passage of time, the giving of notice or both would become an Event of
Default, has occurred and is continuing, Lessee may sublease the Equipment to
any company in which Lessee owns no less than 51% of the voting securities
("voting control"; for purposes of this Section 16, Lessee shall be deemed to
own voting control of any company if Lessee owns voting control of a company
which owns voting control of the company in question) pursuant to a sublease
upon the following terms and conditions (hereinafter a "Sublease"):
(a) The Sublease shall provide that it shall terminate at the option of
Lessor, upon the expiration or earlier termination of this Lease and the
term of the Sublease shall note exceed the then remaining Lease Term
(including, any renewal term, if any, as to which an option to renew has
been irrevocably exercised).
(b) The Sublease shall be a true lease and not a lease intended as
"security" as such term is used in Section 1-201 (37) of the Uniform
Commercial Code.
(c) With respect to the Sublease, to the extent that it has not already done
so, Lessee agrees to assign, and does hereby assign, as collateral security,
and grant, and does hereby grant, to Lessor a security interest in (i) the
Sublease, (ii) all amounts payable thereunder, (iii) all proceeds of
insurance payable to Lessee pursuant to the Sublease, and (iv) all rights
and remedies of Lessee under the Sublease and proceeds from the exercise
thereof all to secure payment and performance of all of Lessee's
liabilities, obligations and indebtedness under this Lease. Lessor's
security interest which is created hereby, if Lessor so elects, may be
perfected by possession of the Sublease rather than filing, as provided in
the Uniform Commercial Code. Until the occurrence of an Event of Default or
event, which with the passage of time, the giving of notice or both would
become an Event of Default hereunder, Lessee shall have the right to collect
and receive, in accordance with the terms hereof, rent and other sums
payable under such Sublease and to retain, use and enjoy the same.
(d) Lessee shall deliver to the Lessor a fully executed copy of the
Sublease, which is, and will be, the only copy marked "Secured Party's
Original." All copies of the Sublease shall bear the following legend: "To
the extent, if any, this instrument constitutes chattel paper under the UCC,
no security interest herein may be created through the transfer and/or
possession of any counterpart other than the counterpart marked 'Secured
Party's Original.'" All copies of the Sublease, other than the "Secured
Party's Original" shall bear the following legend: "'Copy.' No interest
herein may be created or the aircraft subject hereto through the transfer
and/or possession hereof."
(e) The Sublease shall be expressly subject and subordinate to this Lease
and the rights of Lessor hereunder and in and to the Equipment. No
amendment, termination, waiver or modification of any of the terms and/or
conditions of the Sublease shall be effective unless consented to in writing
in advance by Lessor, provided, however, that Lessor's consent shall not be
necessary with respect to any amendment or modification of the Sublease
which increases the amount of the monthly rentals under the Sublease or with
respect to any renewal of such Sublease provided that the term of the
Sublease, upon effecting such renewal is co-terminus with the then current
Lease Term.
(f) Lessee shall deliver to Lessor a consent and acknowledgment executed by
Lessee and the sublessee in form and substance satisfactory to Lessor along
with such other instruments (including, without limitation, Uniform
Commercial Code financing statements) as Lessor may reasonably require.
(g) Such other terms and conditions as Lessor deems necessary and
appropriate.
No such subleasing by Lessee will reduce any of the obligations of Lessee
hereunder or the rights of Lessor hereunder, and all of the obligations of
Lessee hereunder shall be and remain primary and shall continue in full force
and effect as the obligations of a principal and not of a
<PAGE>
guarantor or surety. In the event that after the execution of a Sublease, Lessee
ceases to maintain voting control of the sublessee, Lessor shall have the option
to terminate the Sublease upon thirty (30) days written notice to Lessee.
In addition, Lessee may assign its duties and obligations under the Lease to
any company in which it maintains voting control. Lessee shall deliver to Lessor
a consent and acknowledgment executed by Lessee and such assignee in form and
substance satisfactory to Lessor along with such other instruments (including,
without limitation, Uniform Commercial Code financing statements) as Lessor may
reasonably require to effect such assignment.
No acceptance, assignment, subletting, relinquishment or installation shall
in any event relieve Lessee of primary, absolute and unconditional liability for
its duties and obligations under this Lease.
LESSEE SHALL NOT ASSIGN OR DISPOSE OF ANY OF ITS RIGHTS OR OBLIGATIONS UNDER
THIS LEASE OR ENTER INTO ANY SUBLEASE WITH RESPECT TO ANY OF THE EQUIPMENT
WITHOUT THE EXPRESS PRIOR WRITTEN CONSENT OF LESSOR.
17. LESSEE'S OBLIGATION UNCONDITIONAL
This Lease is a net lease and Lessee hereby agrees that it shall not be
entitled to any abatement of rents or of any other amounts payable hereunder by
Lessee, and that its obligation to pay all rent and any other amounts owing
hereunder shall be absolute and unconditional under all circumstances,
including, without limitation, the following circumstances: (i) any claim by
Lessee to any nright of set-off, counterclaim, recoupment, defense or other
right which Lessee may have against Lessor, any seller or manufacturer of any
Equipment or anyone else for any reason whatsoever; (ii) the existence of any
liens, encumbrances or rights of others whatsoever with respect to any
Equipment, whether or not resulting from claims against Lessor not related to
the ownership of such Equipment; or (iii) any other event or circumstances
whatsoever. Each Rent Payment or other amount paid by Lessee hereunder shall be
final and Lessee will not seek to recover all or any part of such payment from
Lessor for any reason whatsoever.
18. RETURN OF EQUIPMENT
Upon the expiration or earlier termination of the Lease Term with respect
to any item of Equipment, and provided that Lessee has not validly exercised any
purchase option with respect thereto, Lessee shall: (a) return the Equipment to
a location and in the manner designated by the Lessor within the continental
United States, including, as reasonably required by Lessor, securing
arrangements for the disassembly and packing for shipment by an authorized
representative of the manufacturer of the Equipment, shipment with all parts and
pieces on a carrier designated or approved by Lessor, and then reassembly
(including, if necessary, repair and overhaul) by such representative at the
return location in the condition the Equipment is required to be maintained by
the Lease and in such condition as will make the Equipment immediately able to
perform all functions for which the Equipment was originally designed (or as
upgraded during the Lease Term), and immediately qualified for the
manufacturer's (or other authorized servicing representative's) then-available
service contract or warranty; (b) cause the Equipment to qualify for all
applicable licenses or permits necessary for its operation for its intended
purpose and to comply with all specifications and requirements of applicable
federal, state and local laws, regulations and ordinances; (c) upon Lessor's
request, provide suitable storage, acceptable to Lessor, for the Equipment for a
period not to exceed 180 days from the date of return; (d) cooperate with
Lessor in attempting to remarker the Equipment, including display and
demonstration of the Equipment to prospective purchasers or lessees, and
allowing Lessor to conduct any private or public sale or auction of the
Equipment on Lessee's premises. All costs incurred in connection with any of the
foregoing shall be the sole responsibility of the Lessee. During any period of
time from the expiration or earlier termination of the Lease until the Equipment
is returned in accordance with the provisions hereof or until Lessor has been
paid the applicable purchase option price if any applicable purchase option is
exercised, Lessee agrees to pay to Lessor additional per diem rent ("Holdover
Rent"), payable promptly on demand in an amount equal to 125% of the highest
monthly Rental Payment payable during the Lease Term divided by 30, provided,
however, that nothing contained herein and no payment of Holdover Rent hereunder
shall relieve Lessee of its obligation to return the Equipment upon the
expiration or earlier termination of the Lease.
19. MISCELLANEOUS
THE LEASE REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES CONCERNING THE
LEASE OF THE EQUIPMENT AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. LESSEE
ACKNOWLEDGES AND CERTIFIES THAT NO SUCH ORAL AGREEMENTS EXIST. The Lease may not
be amended, nor may any rights under the Lease be waived, except by an
instrument in writing signed by the party charged with such amendment or waiver.
The term "Lessee" as used in the Lease shall mean and include any and all
Lessees who sign below, each of whom shall be jointly and severally liable under
the Lease. This Master Lease will not be binding on Lessor until accepted and
executed by Lessor, notice of which is hereby waived by Lessee. Any waiver of
the terms hereof shall be effective only in the specific instance and for the
specific purpose given. Time is of the essence in the payment and performance of
all of Lessee's obligations under the Lease. The captions in this Lease are for
convenience only and shall not define or limit any of the terms hereof.
20. ENFORCEABILITY AND GOVERNING LAW
Any provisions of this Lease which are unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
unenforceability without invalidating the remaining provisions hereof, and any
such unenforceability in any jurisdiction shall not render unenforceable such
provisions in any other jurisdiction. To the extent permitted by applicable law,
Lessee hereby waives; (a) any provisions of law which render any provision
hereof unenforceable in any respect; (b) all rights and remedies under Rhode
Island General Laws Sections 6A-2.1-508 through 522 or corresponding provisions
of the Uniform Commercial Code article or division pertaining to personal
property leasing in any jurisdiction in which enforcement of this Lease is
sought.
THIS LEASE AND THE LEGAL RELATIONS OF THE PARTIES HERETO SHALL IN ALL
RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF RHODE ISLAND, WITHOUT REGARD TO PRINCIPLES REGARDING THE CHOICE OF LAW.
LESSEE AND LESSOR HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF THE COURTS
OF THE STATE OF RHODE ISLAND AND CALIFORNIA AND THE FEDERAL DISTRICT COURT FOR
THE DISTRICT OF RHODE ISLAND AND THE NORTHERN DISTRICT OF CALIFORNIA FOR THE
PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF ITS OBLIGATIONS
HEREUNDER, AND EXPRESSLY WAIVES ANY OBJECTIONS THAT THEY MAY HAVE TO THE VENUE
OF SUCH COURTS. LESSEE HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY
ACTION BROUGHT ON OR WITH RESPECT TO THIS LEASE. Any action by Lessee against
Lessor for any cause of action relating to this Lease shall be brought within
one year after any such cause of action first arises.
Executed and delivered by duly authorized representatives of the parties hereto
as of the date set forth below.
DATED AS OF: December 19, 1995
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
This is counterpart No. 2 of a total of 2 counterparts. Only counterpart No. 1
shall be considered chattel paper for purposes of the Uniform Commercial Code
and a security interest may be perfected only by possession of counterpart No.
1.
<PAGE>
FLEET CREDIT CORPORATION
SECRETARY'S' CERTIFICATE
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
The undersigned, Joseph Zils, the duly elected Secretary of OPTICAL COATING
LABORATORY, INC. (the "Corporation"), in order to induce Fleet Credit
Corporation ("FCC") to enter into one or more loans, leases or otherwise extend
financial accommodations to or for the benefit of the Corporation, hereby
certifies to FCC that:
(i) the Corporation is duly organized, validly existing and in good standing
under the laws of the State or Commonwealth of Delaware;
(ii) the Corporation has full corporate power and authority to enter into one or
more transactions, at any time and in any amount or form, with FCC: (a) to sell
to and/or lease from FCC any personal property or fixtures; (b) to borrow and
otherwise effect loans and advances or extensions of credit; (c) to guaranty or
otherwise provide financial accommodations or additional security for the
payment and performance of any obligations or indebtedness owing to FCC by the
Corporation or any other party; and (d) to sell, assign, transfer, mortgage,
pledge, hypothecate, grant security interests in, endorse and deliver to FCC,
any and all real or personal property of the Corporation, tangible or
intangible, of every name and description, as security for the payment and
performance of any obligations or indebtedness owing to FCC by the Corporation
or any other party, or otherwise in connection with any of the foregoing (the
"Authorized Transactions");
(iii) each of the officers designated below (an "Authorized Officer"), is a duly
elected (or appointed), qualified and acting officer of the Corporation, and the
signature appearing opposite his or her name below is his or her genuine
signature:
Name Office Signature
- ---- ------ ---------
John Markovich Vice President & CFO /s/ John M. Markovich
- --------------- ------------------------------- -------------------------
Jeff Ryan Assistant Treasurer /s/ Jeffrey M. Ryan
- --------------- ------------------------------- -------------------------
Joseph Zils VP, Secretary & General Counsel /s/ Joseph Zils
- --------------- ------------------------------- -------------------------
(iv) each Authorized Officer has full power and authority to act alone on behalf
of the Corporation with respect to the Authorized Transactions and to do and
perform all acts and things, and to execute and deliver all instruments and
documents of every kind and nature he or she may deem necessary, proper or
incidental to, or which is otherwise reasonably required by FCC in connection
with, completion of the Authorized Transactions, including but not limited to
one or more leases, loan agreements, promissory notes, security agreements,
schedules, riders, certificates, guaranties, pledge agreements, subordination
agreements, purchase orders or agreements, disbursement authorizations,
invoices, bills of sale, intercreditor agreements, consents, disclaimers of
interests, and UCC financing statements and any future modification(s) or
amendments thereof ("Authorized Documentation"), with such execution and
delivery to be conclusive evidence that such Authorized Transactions have been
duly and specifically authorized and approved by the Board of Directors of the
Corporation as being for the benefit of the Corporation and that such Authorized
Documentation is intended by the Board of Directors to constitute the valid and
legally binding obligations of the Corporation, enforceable by FCC in accordance
with their terms;
(v) all corporate votes, meetings, consents or other actions necessary or
appropriate to duly and properly authorize the Corporation to enter into the
Authorized Transactions and for the Authorized Officers to execute and deliver
the Authorized Documentation has been taken, and such corporate actions are in
full force and effect as of the date hereof and have not been modified or
rescinded in any respect.
(vi) all previous acts of, and all documents and papers heretofore executed and
delivered by, any Authorized Officer in connection with the Authorized
Transactions or any Authorized Documentation are ratified, confirmed and
approved as the act or acts of the Corporation;
(vii) the Corporation shall furnish written notice to FCC of any revocation,
modification or amendment of any corporate action affecting any of the foregoing
certifications, and FCC shall be entitled to rely on these certifications until
such notice is received by FCC.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the
Corporation, this 19th day of December, 1995.
/s/ Joseph Zils
---------------
Secretary
<PAGE>
FLEET CREDIT CORPORATION
LEASE SCHEDULE NO. 32053-00001
(True Lease Schedule)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
Lessee: OPTICAL COATING LABORATORY, INC.
Address: 2789 NORTH POINT PARKWAY
SANTA ROSA, CA 95407
1. This Lease Schedule No. 32053-00001 dated as of December 19, 1995
is entered into pursuant to, and incorporates by this reference, all of the
terms and provisions of that certain Master Equipment Lease Agreement No. 32053
dated as of December l9, 1995 (the "Master Lease"), for the lease of the
Equipment described in Schedule A attached hereto. This Lease Schedule shall
constitute a separate, distinct and independent lease of the Equipment and the
contractual obligation of Lessee. References to the "the Lease" or "this Lease"
shall mean and refer to this Lease Schedule, together with the Master Lease and
all exhibits, addenda, schedules, certificates, riders and other documents and
instruments executed and delivered in connection with this Lease Schedule, all
as the same may be amended or modified from time to time. All capitalized terms
used herein and not defined herein shall have the meanings set forth or referred
to in the Master Lease. By its execution and delivery of this Lease Schedule,
Lessee hereby reaffirms all of the representations, warranties and covenants
contained in the Master Lease, as of the date hereof, and further represents and
warrants to Lessor that no Event of Default, and no event or condition which
with notice or the passage of time or both would constitute an Event of Default,
has occurred and is continuing as of the date hereof.
2. ACQUISITION COST. The Acquisition Cost of the Equipment is:
$5,900,000.00.
3. (a) LEASE TERM. The Lease Term shall commence on the date hereof
and shall continue for a period of 7:2 months after the Lease Term Commencement
Date set forth in the Acceptance Certificate to this Lease Schedule, plus any
renewal or extended term applicable in accordance with the terms of the Lease.
(b) RENTAL PAYMENTS. In addition to interim rent payable pursuant
to Section 2 of the Master Lease, Lessee shall pay Lessor 72. consecutive Rental
Payments in the amounts set forth in the schedule below, plus any applicable
sales/use taxes, commencing on the Rental Payment Commencement Date set forth in
the Acceptance Certificate and monthly thereafter for the remaining Lease Term.
Each Rental Payment shall be payable on the same day of the month as the Rental
Payment Date in each succeeding rental period during the remaining Lease Term
(each, a "Rental Payment Date"):
Amount of Each
Number of Rental Payments Rental Payment
------------------------- ---------------
36 $75,997.31
36 92,885.65
(c) ADVANCE RENTAL PAYMENT. Lessee agrees to pay Lessor the,first
Rental Payment, due and payable on the Acceptance Date.
(d) SECURITY DEPOSIT. Lessee agrees to make a payment in an amount
equal to ____% of the Acquisition Cost of the Equipment, due and payable on the
Acceptance Date, to be held by Lessor as a non-interest bearing deposit to
secure Lessee's performance under the Lease.
<PAGE>
4. EQUIPMENT LOCATION(S). The Equipment will be located at the
location(s) specified in Schedule A-1 hereto.
5. Lessor will invoice Lessee for all sales, use and/or personal
property taxes as and when due and payable in accordance with applicable law,
unless Lessee delivers to Lessor a valid exemption certificate with respect to
such taxes. Delivery of such certificate shall constitute Lessee's
representation and warranty that no such taxes shall become due and payable with
respect to the Equipment and Lessee shall indemnify and hold harmless Lessor
from and against any and all liability or damages, including late charges and
interest which Lessor may incur by reason of the assessment of such taxes.
6. The Rental Payments may change for Equipment accepted after
December 26, 1995.
Dated as of: December 19, 1995
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
This is counterpart No. 2 of a total of 2 counterparts. Only counterpart No. 1
shall be considered chattel paper for purposes of the Uniform Commercial Code
and a security interest may be perfected only by possession of counterpart No.
1.
<PAGE>
FLEET CREDIT CORPORATION Schedule A Equipment
Attached to and made part of the following documents: True Lease Schedule
No. 32053-01, Acceptance Certificate, Consent and Waiver Form, UCC-1
Financing Statement and UCC-1 Fixture Filing.
with: Optical Coating Laboratory, Inc.
- --------------------------------------------------------------------------------
QTY. DEPRECIABLE LIFE, DESCRIPTION and VENDOR MODEL NO. SERIAL NO.
- --------------------------------------------------------------------------------
Depreciable Life of Equipment is 07 Years.
Bystronics Inc. vertical to horizontal loading
system, model 556U-106-144, approx. size 10" X 16,
23-5" rollers, 6 suction cup stations, gear driven,
480 volt, Atlantic fluid power hydraulic pump, model
AF-10247, serial 1029622, Buush vacuum pump type
RC0063-4005-1001, serial C25315.
New London conveyer with pop out station, model
MD500, serial 1GN025727, approx. size 14' X 14' 17
4" rollers, 16 pop out belts, gear driven with
reliance control box.
New London prewash conveyer, 17 4" rollers, gear
driven, approx. size 10' X 10', reliance control
box.
Billco plate scrubber/washer, single sided, model
684-8, serial 9593, 480 volt, system has the
following stations:
Preclean station: spray bars, stainless steel
cascading tanks, low level controls, flow meters.
Scrubbing station: spray bars, high pressure
pumps, stainless steel cascading tanks, low level
controls, oscillating scrubbing brush, AMP meters,
all stainless steel construction, Pumice tank 30"
diameter with lightening mixer, type 2, all Baldor
TEFC motors.
Post cleaning station: with 8 brush washer module,
heaters, spray bars, low level controls, stainless
steel cascading tank, all Baldor TEFC motors, flow
meters, all stainless steel construction.
Drying station: with 3 pair air knifes,
manometers, Billco blower with HEPA filters, static
bar.
- --------------------------------------------------------------------------------
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
<PAGE>
FLEET CREDIT CORPORATION Schedule A Equipment
Attached to and made part of the following documents: True Lease Schedule
No. 32053-01, Acceptance Certificate, Consent and Waiver Form, UCC-1
Financing Statement and UCC-1 Fixture Filing.
with: Optical Coating Laboratory, Inc.
- --------------------------------------------------------------------------------
QTY. DEPRECIABLE LIFE, DESCRIPTION and VENDOR MODEL NO. SERIAL NO.
- --------------------------------------------------------------------------------
Class 100 portable clean room with safety lights,
mylar curtains, 30-Envirco 24" X 48" HEPA filters,
model MACK10.
New London conveyer, approx. size 8' X 16', 17-4"
rollers, reliance controls, model SP500.
Airco In-line flat glass coating system- model C-9,
MFG. 1990, the coating is based on the use of the
AIRCO C-MAG dual rotatable and planner
magnetron-type spu.ttering cathodes, maximum load
size 74" X 130" the above system consists of the
following components:
Entry lock chamber: The entry lock chamber is
pumped down using (4) Edwards vacuum pumps, model
2M275, serials 875, 892,904,876, each pump has a
Balston filter, model AR0780371H, rotary load
vacuum' blower, model 1030RGS-HVR, powered by a 100
HP motor, double polycold, model PFC500B, serial 501
660, 16" varian diffusion pump, 2-clear glass
viewports, 2 Ion gauges, pressure switches, internal
o-ring elastomer conveyer belt, slit valves.
Main-chamber: The main chamber consists of 3
sections. Entry Buffer/Interstagea; area has a
optical monitoring unit with a 6' monitoring heads,
internal. conveyer, 2 viewports, varian diffusion
pump, poppet valves, gauges.
- --------------------------------------------------------------------------------
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
<PAGE>
FLEET CREDIT CORPORATION Schedule A Equipment
Attached to and made part of the following documents: True Lease Schedule
No. 32053-01, Acceptance Certificate, Consent and Waiver Form, UCC-1
Financing Statement and UCC-1 Fixture Filing.
with: Optical Coating Laboratory, Inc.
- --------------------------------------------------------------------------------
QTY. DEPRECIABLE LIFE, DESCRIPTION and VENDOR MODEL NO. SERIAL NO.
- --------------------------------------------------------------------------------
Coating sections: consists of 8 cathodes that make
up 4-2 cathode positions, each separated by a varian
16" diffusion pump, 6 of the cathode positions are
equipped with externally adjustable over spray
shields, the pumping system is a Edwards 275 vacuum
pump, model E2M275, serial 10335, with a mechanical
booster hydrokinetic drive, model EH2600, Balston
filter model AR-0780-371H, viewports, manometers,
Ion gauges, internal conveyer.
Exit/buffer/Interstage: has a optical monitoring
unit with 6 monitoring heads, internal conveyer,
2-viewports, varian diffusion Pump, poppet valves,
gauges.
Exit lock chamber: The exit lock chamber is pumped
down using (4) Edwards vacuum pumps, model 2M275,
serials 8905, 8555,8615,877, each pump has a Balston
filter model AR0780371H, rotary load vacuum blower,
model RGS-HV8, powered by a 100 HP motor, double
Polycold, model PFC500B, 16" varian diffusion pump,
2-clear glass viewports, 2 Ion gauges, pressure
switches, internal o-ring elastomer conveyer belt,
slit valves.
Control room: is equipped with 14 multi-set point
controllers which control amps, kilowatts, volts,
from the cathodes, 3 process controller terminals,
which are Sony monitors with Dell Optiplex XM590
computers, screenware software, emergency shut-off
switches.
- --------------------------------------------------------------------------------
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
<PAGE>
FLEET CREDIT CORPORATION Schedule A Equipment
Attached to and made part of the following documents: True Lease Schedule
No. 32053-01, Acceptance Certificate, Consent and Waiver Form, UCC-1
Financing Statement and UCC-1 Fixture Filing.
with: Optical Coating Laboratory, Inc.
- --------------------------------------------------------------------------------
QTY. DEPRECIABLE LIFE, DESCRIPTION and VENDOR MODEL NO. SERIAL NO.
- --------------------------------------------------------------------------------
1 Polymetrics D.I water system hot/cold water,
consisting of but not limited to: filter specialist
filters, model FSPN-1300-SS, serial 37588, Mfg.
1995, Polymetrics osmosis system, 15 HP, model
HTFC-K-369976, serial 95071-00, (2) Polymetrics Ion
exchange vessels, storage tank 12 X 12, model 12 X
12, serial 950339.
Varian leak detector, model 938-41 with SD-450 pump.
Extensive spare parts inventory consisting of but
not limited to: o-rings, bushings, nipples, tubing,
limit switches, rings, washers, bearings, air
cylinders, couplings, actuators, vacuum switches,
convection gauge tubes, unions adapters, elbows,
gaskets, tee's, mass flow controllers, hoses, air
motors, insuliners, connector magnet ends, nuts,
screws, sprockets, roller chains, pin springs,
belts, air valves, lube oil, Dow corning Hi vac
grease, mobil clutch oil, invoil 940 diffusion pump
fluid, transformers, modules, power supplies, fuses,
circuit cards, toggle switches, servopacks, pin
connectors, resistors, push buttons, quick
disconnects, ball valves, flow setters, plugs,
filters, coils, clamps, jumpers, collars, cathode
cables, lugs, pumps, assorted hand tools, cribs,
etc.
Material inventory, consisting of but not limited
to: (2) planar ZN, (1) planar AG, (8) planar CR, (2)
planar ZRB2, (1) planar TI, (1) planar SN, (11)
C-MAG ZN, (14) C-MAG SI, (6) C-MAG ZR, (10) C-MAG
TI, (8) C-MAG SN.
AND ALL STANDARD AND ACCESSORY EOUIPMENT
- --------------------------------------------------------------------------------
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
<PAGE>
FLEET CREDIT CORPORATION Schedule A-1
Equipment Location
Attached to and made part of the following documents: True Lease Schedule
No. 32053-01, Acceptance Certificate, Consent and Waiver Form, UCC-1
Financing Statement and UCC-1 Fixture Filing.
with: Optical Coating Laboratory, Inc.
- --------------------------------------------------------------------------------
LOC. EQUIPMENT CURRENTLY LOCATED AT:
- --------------------------------------------------------------------------------
01 Optical Coating Laboratory, Inc.
1405 Thunderbolt Way
Santa Rosa, CA 95407
- --------------------------------------------------------------------------------
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
<PAGE>
FLEET CREDIT CORPORATION Schedule A Equipment
Attached to and made part of the following documents: True Lease Schedule
No. 32053-01, Acceptance Certificate, Consent and Waiver Form, UCC-1
Financing Statement and UCC-1 Fixture Filing.
with: Optical Coating Laboratory, Inc.
- --------------------------------------------------------------------------------
QTY. DEPRECIABLE LIFE, DESCRIPTION and VENDOR MODEL NO. SERIAL NO.
- --------------------------------------------------------------------------------
Billco triple cascading rinser/dryer, 84" wide, 7
spray banks, 4 air knifes, chain driven, Honeywell
control, model 100-191, serial 92192.
New London conveyer, approx. 8' X 14', chain driven,
15-4" rollers, pillow block bearings.
Walco film applicator, model 810/84, serial
956996900, 84" capacity, adjustable tension
controls, adjustable film sizes, nip rollers, safety
eyes.
New London conveyer with pop up capabilities, model
16STAND-POP-UP, 12 X 24, serial 9533818, chain
driven, 4" rollers.
Bystronics Ind. CNC automated flat glass scribing
machine, model XY2-F-92, serial 045, date 1995,
machine #E4053-95, CNC controls, 2 air tables,
safety rails.
Compair air compressor, model HYDROVANE 218, serial
218-000623, hours 174.
Compair air compressor, model HYDROVANE 218, serial
218-800624, hours 800.
Compair air compressor, model HYDROVANE 218, serial
218-000625, hours 383.
Ultra-air dryer, model UA625AC, serial U-12345.
Cooling tower, approx. 10' X 10' X 20' with
centrifugal pumps, type T508-80E-CH, model
125OY125BP4-6-30, (2) return pumps, type HOV-CH,
model 150X12514-6552.
- --------------------------------------------------------------------------------
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
<PAGE>
FLEET CREDIT CORPORATION ACCEPTANCE CERTIFICATE
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Acceptance Certificate is attached to and made a part of that certain
Lease Schedule No. 32053-00001, dated as of December 19, 1995 (the "Lease
Schedule"), by and between the undersigned parties. All capitalized terms used
herein and not defined herein shall have the meanings set forth or referred to
in the Lease Schedule. To the extent the terms set forth in this Acceptance
Certificate differ or conflict with any of the terms set forth in the Lease, the
terms set forth in this Acceptance Certificate shall control.
1. Lessee acknowledges and agrees that each item of Equipment set forth on
Schedule A hereto (collectively, the "Equipment") is hereby unconditionally
accepted by Lessee for all purposes under the Lease at the locations specified
in Schedule A-1 hereto, and hereby agrees to faithfully perform all of its
obligations under the Lease as of the date hereof (the "Acceptance Date").
2. By its execution and delivery of this Acceptance Certificate, Lessee
hereby reaffirms all of the representations, warranties and covenants contained
in the Lease as of the date hereof, and further represents and warrants to
Lessor that no Event of Default, and no event or condition which with notice or
the passage of time or both would constitute an Event of Default, has occurred
and is continuing as of the date hereof. Lessee further certifies to Lessor that
Lessee has selected the Equipment and has received and approved the purchase
order, purchase agreement or supply contract under which the Equipment has been
acquired for all purposes of the Lease.
3. Lessee hereby represents and warrants that: (a) the Equipment has been
delivered and is in an operating condition and performing the operation for
which it is intended to the satisfaction of the Lessee; and (b) if requested by
Lessor, the Equipment has been marked or labeled evidencing the Lessor's
interest therein.
4. The LEASE TERM COMMENCEMENT DATE is the 20 day of December, 1995.
5. The RENTAL PAYMENT COMMENCEMENT DATE is the 20 day of December, 1995.
6. All terms and provisions of the Lease Schedule shall remain in full force
and effect, except as otherwise provided below:
- ACQUISITION COST: $_______________.
- LEASE TERM: _______________ months.
- RENTAL PAYMENTS: Number of Rental Payments Rental Payment Amount
------------------------- ---------------------
- ADVANCE RENTAL PAYMENT(S): First only.
- SECURITY DEPOSIT: 0%.
Dated: December 22, 1995
Agreed and Accepted:
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
<PAGE>
[LOGO] PURCHASE OPTION RIDER
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (the "Rider") is attached to and made a part
of that certain Lease Schedule No. 32053-00001, dated as of DECEMBER 19, 1995
(the "Lease Schedule"), by and between the undersigned parties.
1. Purchase Option. If no Event of Default (or event or condition
which, with the passage of time or giving of notice, or both, would become such
an Event of Default) shall have occurred and be continuing, and the Lease shall
not have been earlier terminated, Lessee shall have the option to purchase (the
"Purchase Option") all, but not less than all, of the Equipment at the
expiration of the Lease Term for an amount, payable in immediately available
funds on the last day of the Lease Term, equal to: (a) all Rental Payments, late
charges and other amounts due and owing under the Lease; plus (b) all taxes,
assessments and other charges due or payable in connection with the sale of the
Equipment to Lessee; plus (c) the Purchase Option Price (hereinafter defined).
Provided that Lessor shall have received all amounts payable hereunder
on the last day of the Lease Term, and that no Event of Default then exists and
is continuing under the Lease, Lessor shall convey all of its right, title and
interest in and to the Equipment to Lessee on the last day of the Lease Term, on
an "AS-IS", "WHERE-IS" BASIS WITHOUT REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, and without recourse to Lessor, except that the Equipment shall be free
and clear of all liens created by Lessor. If Lessee intends to exercise the
Purchase Option, Lessee shall give irrevocable written notice to Lessor (the
"Option Notice") not more than 240 days, nor less than 180 days, prior to the
expiration of the Lease Term. If Lessee fails to give such written notice to
Lessor, it shall be conclusively presumed that Lessee has elected not to
exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 3% of the Acquisition Cost of the
Equipment.
2. Purchase Option Price. If Lessee has elected to exercise the
Purchase Option, then the "Purchase Option Price" shall be the Fair Market Value
(hereinafter defined) of the Equipment, provided, however, that the Purchase
Option Price shall not exceed 30.00000% of the Acquisition Cost of the
Equipment. As soon as practicable following Lessor's receipt of the Option
Notice, Lessor and Lessee shall agree on the Fair Market Value of the Equipment
as of the end of the Lease Term. "Fair Market Value" of the Equipment shall be
the amount determined on the basis of, and equal in value to, the amount which
would be obtained in an arm's-length transaction between an informed and willing
buyer-user (other than a buyer-user currently in possession or a used equipment
or scrap dealer) and an informed and willing seller, under no compulsion to buy
or sell, and in such determination, costs of removal from the location of
current use shall not be a deduction from such value, and it shall be assumed
(whether or not the same be true) that the Equipment has been maintained and
would have been returned to Lessor in compliance with the requirements of the
Lease.
<PAGE>
If Lessor and Lessee fail to agree upon Fair Market Value on or before
one hundred sixty (160) days prior to the expiration of the Lease Term, then
such value shall be determined by the Appraisal Procedure (as set forth in
Section 3 below), at Lessee's sole cost and expense.
3. Appraisal Procedure. On the earlier of 160 days prior to the end of
the Lease Term or the date on which either party hereto shall have given written
notice to the other requesting determination of the Fair Market Value of the
Equipment by this Appraisal Procedure (the "Appraisal Notice"), the parties
shall consult for the purpose of appointing a qualified independent appraiser by
mutual agreement. If no such appraiser is so appointed within ten (10) business
days after the Appraisal Notice is given, each party shall appoint an
independent appraiser and the two appraisers shall attempt to jointly agree on
the Fair Market Value of the Equipment. If the two appraisers cannot so agree,
then the two appraisers so appointed shall appoint a third independent
appraiser. If the two appraisers have been unable to agree on the Fair Market
Value and on a third appraiser within thirty (30) days after the date of their
appointment, Lessor may apply to the American Society of Appraisers or the
American Arbitration Association to make such appointment, and both parties
shall be bound by any such appointment. Any appraiser or appraisers appointed
pursuant to this Appraisal Procedure shall be bound to determine the Fair Market
Value of the Equipment within thirty (30) days after the appointment of the
final appraiser to be employed pursuant to this Appraisal Procedure. If the
parties shall have appointed a single appraiser, his or her determination of
value shall be final, binding and conclusive on the parties. If the parties have
appointed two appraisers, then their jointly agreed determination of value shall
be final, binding and conclusive on the parties. If three appraisers shall be
appointed, the values determined by the three appraisers shall be averaged, the
appraisal having a value furthest from the average shall be discarded and the
remaining two appraised values shall be averaged, and the average of the
remaining two appraised values shall be final, binding and conclusive on the
parties.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: DECEMBER 19, 1995
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: By:
------------------------------ ------------------------------
Name: Name:
---------------------------- ----------------------------
Title: Title:
--------------------------- ---------------------------
<PAGE>
If Lesser and Lessee fail to agree upon Fair Market Value on or
before one hundred sixty (160) days prior to the expiration of the Lease Term,
then such value shall be determined by the Appraisal Procedure (as set forth in
Section 3 below), at Leesee's sole cost and expense.
3. Appraisal Procedure. On the earlier of 160 days prior to the end
of the Lease Term or the date on which either party hereto shall have given
written notice to the other requesting determination of the Fair Market Value of
the Equipment by this Appraisal Procedure (the "Appraisal Notice"), the parties
shall consult for the purpose of appointing a qualified independent appraiser by
mutual agreement. If no such appraiser is so appointed within ten (10) business
days after the Appraisal Notice is given, each party shall appoint an
independent appraiser and the two appraisers shall attempt to jointly agree on
the Fair Market Value of the Equipment. If the two appraisers cannot so agree,
then the two appraisers so appointed shall appoint a third independent
appraiser. If the two appraisers have been unable to agree on the Fair Market
Value and on a third appraiser within thirty (30) days after the data of their
appointment, Lessor may apply to the American Society of Appraisers or the
American Arbitration Association to make such appointments, and both parties
shall be bound by any such appointment. Any appraiser or appraisers appointed
pursuant to this Appraisal Procedure shall be bound to determine the Fair Market
Value of the Equipment within thirty (30) days after the appointment of the
final appraiser to be employed pursuant to this Appraisal Procedure. If the
parties shall have appointed a single appraiser, his or her determination of
value shall be final, binding and conclusive on the parties. If the parties have
appointed two appraisers, then their jointly agreed determination of value shall
be final, binding and conclusive on the parties. if three appraisers shall be
appointed, the values determined by the three appraisers shall be averaged, the
appraisal having a value furthest from the average shall be discarded and the
remaining two appraised values shall be averaged, and the average of the
remaining two appraised values shall be final, binding and conclusive on the
parties.
All capitalized terms used herein and not defined herein shall have
the meanings set forth or referred to in the Lease Schedule. Except as
specifically set forth herein, all of the terms and conditions of the Lease
shall remain in full force and effect and are hereby ratified and affirmed. To
the extent that the provisions of this Rider conflict with any provisions
contained in the Lease, the provisions of this Rider shall control.
Dated as of: DECEMBER 19, 1995
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
This is counterpart No. 2 of a total of 2 counterparts. Only counterpart No. 1
shall be considered chattel paper for purposes of the Uniform Commercial Code
and a security interest may be perfected only by possession of counterpart No.
1.
<PAGE>
This is counterpart No. 2 of a total of 2 counterparts. Only counterpart No. 1
shall be considered chattel paper for purposes of the Uniform Commercial Code
and a security interest may be perfected only by possession of counterpart No.
1.
[LOGO] EARLY PURCHASE OPTION RIDER
Fleet Credit Corporation (single option)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Early Purchase Option Rider (the "Rider") is attached to and made
a part of that certain Lease Schedule No. 32053-00001, dated as of DECEMBER 19,
1995 (the "Lease Schedule"), by and between the undersigned parties.
So long as no Event of Default has occurred and is continuing under the
Lease, and upon at least 90 days prior written notice to Lessor, Lessee shall
have the right to terminate the Lease Term for all but not less than all of the
Equipment on the Rental Payment Date for Rental Payment Number 60 (the
"Termination Date"). Lessee shall pay to Lessor on the Termination Date an
amount equal to: (a) all Rental Payments, late charges and other amounts due and
owing under the Lease; plus (b) all taxes, assessments and other charges due or
payable in connection with the sale of the Equipment to Lessee; plus, (c) 43.00
% of the Acquisition Cost of the Equipment.
Provided that Lessor shall have received all amounts payable hereunder
on the Termination Date, and that no Event of Default then exists and is
continuing under the Lease, Lessor shall convey all of its right, title and
interest in and to the Equipment to Lessee on the Termination Date, on an
"AS-IS", "WHERE-IS" BASIS WITHOUT REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, and without recourse to Lessor, except that the Equipment shall be free
and clear of all liens created by Lessor.
In the event Lessee shall not pay all amounts due hereunder on the
Termination Date, then the Lease Term for the Equipment shall continue in full
force and effect, and this Rider shall be null and void and of no further force
and effect.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: DECEMBER 19, 1995
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
<PAGE>
STIPULATED LOSS VALUE SCHEDULE
[LOGO]
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Stipulated Loss Value Schedule (the "Schedule") is attached to
and made a part of that certain Lease Schedule No. 32053-00001, dated as of
DECEMBER 19, 1995 (the "Lease Schedule"), by and between the undersigned
parties.
The following Stipulated Loss Values shall be used to calculate damages
or loss as provided in the Master Lease. The Stipulated Loss Value with respect
to any item of Equipment on any Rental Payment Date during the Lease Term shall
be an amount equal to the sum of: (a) all Rental Payments and other amounts then
due and owing to Lessor under the Lease, together with all accrued interest and
late charges thereon, calculated through and including the date of payment; plus
(b) the product of the Acquisition Cost of the such Equipment multiplied by the
percentage as of such Rental Payment Date as set forth on the reverse side
hereof.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed.
Dated as of: DECEMBER 19, 1995
FLEET CREDIT CORPORATION OPTICAL COATING LABORATORY, INC.
By: /s/ Lisa D. Wardle By: /s/ John M. Markovich
------------------------------ ------------------------------
Name: LISA D. WARDLE Name: John M. Markovich
---------------------------- ----------------------------
Title: Assistant Vice President Title: VP Finance & CFO
--------------------------- ---------------------------
This is counterpart No. 2 of a total of 2 counterparts. Only counterpart No. 1
shall be considered chattel paper for purposes of the Uniform Commercial Code
and a security interest may be perfected only by possession of counterpart No.
1.
<PAGE>
<TABLE>
<CAPTION>
Rental Payment Date for Percentage of Rental Payment Date for Percentage of
Rental Payment Number Acquisition Cost Rental Payment Number Acquisition Cost
<S> <C> <C> <C>
Dec-20-95 103. 71191018 Dec-20-98 75. 61083998
Jan-20-96 103. 10325906 Jan-20-99 74. 41927127
Feb-20-96 102. 48881671 Feb-20-99 73. 21888014
Mar-20-96 101. 86856056 Mar-20-99 72. 00963223
Apr-20-96 101. 23595169 Apr-20-99 70. 79267773
May-20-96 100. 56272737 May-20-99 69. 57156887
Jun-20-96 99. 88267988 Jun-20-99 68. 34270075
Jul-20-96 99. 19068441 Jul-20-99 67. 10963831
Aug-20-96 98. 49257297 Aug-20-99 65. 86759178
Sep-20-96 97. 78752786 Sep-20-99 64. 61769304
Oct-20-96 97. 07045090 0ct20-99 63. 36352940
Nov-20-96 96. 34716025 Nov-20-99 62. 10029946
Dec-20-96 95. 61682414 Dec-20-99 60. 82912327
Jan-20-97 94. 87437132 Jan-20-00 59. 55361078
Feb-20-97 94. 12560593 Feb-20-00 58. 26894881
Mar-20-97 93. 37050337 Mar-20-00 56. 97510170
Apr-20-97 92. 60898815 Apr-20-00 55. 67317580
May-20-97 91. 83912210 May-20-00 54. 36682732
Jun-20-97 91. 06277783 Jun-20-00 53. 05234454
Jul-20-97 90. 27803297 Jul-20-00 51. 73339705
Aug-20-97 89. 48681076 Aug-20-00 50. 40513084
Sep-20-97 88. 68901553 Sep-20-00 49. 06863302
Oct-20-97 87. 88274773 Oct-20-00 47. 72759662
Nov-20-97 87 06991871 Nov-20-00 46. 37715544
Dec-20-97 86. 25042075 Dec-20-00 45. 01838420
Jan-20-98 85. 42237739 Jan-20-01 43. 65499964
Feb-20-98 84. 58763797 Feb-20-01 42. 28212323
Mar-20-98 83. 74632661 Mar-20-01 40. 89971796
Apr-20-98 82. 89875416 Apr-20-01 39. 51159878
May-20-98 82 04546509 May-20-01 38. 13255957
Jun-20-98 81. 18591198 Jun-20-01 36. 74782139
Jul-20-98 80. 32060206 Jul-20-01 35. 37217451
Aug-20-98 79. 44850088 Aug-20-01 33. 98698799
Sep-20-98 78. 57005214 Sep-20-01 32. 59607521
Oct-20-98 77. 68578318 Oct-20-01 31. 21423302
Nov-20-98 76 79464909 Nov-20-01 29. 82282705
</TABLE>
<PAGE>
WARRANTY BILL OF SALE
[LOGO]
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903
OPTICAL COATING LABORATORY, INC. ("Seller) of 2789 NORTH POINT PARKWAY
SANTA ROSA, CA 95407, in consideration of the sum of $5,900,000.00 Dollars, and
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, does hereby sell, transfer and assign to Fleet Credit
Corporation ("FCC") a Rhode Island corporation having its principal office at 50
Kennedy Plaza, Providence, Rhode Island 02903, the equipment set forth in
Schedule A hereto (the "Equipment").
Seller hereby covenants with and warrants to FCC that Seller is the
lawful owner of the Equipment and has the right to sell the Equipment, and that
the Equipment is free and clear of all rights, claims, liens, charges, security
interests or encumbrances of any other person. Seller will forever indemnify,
defend and warrant all of the rights of FCC in and to the Equipment transferred
hereunder against the claims and demands of all other persons.
IN WITNESS WHEREOF, Seller has duly executed this Bill of Sale this 19th day of
December, 1995.
OPTICAL COATING LABORATORY, INC.
By: /s/ John M. Markovich
------------------------------
Name: John M. Markovich
----------------------------
Title: VP Finance & CFO
---------------------------
State of California
--------------------
County of Sonoma
--------------------
Subcribed and sworn before me this 22nd day of December, 1995.
/s/ Agie S. Navarro
----------------------------------------
Notary Public
My Commission expires: November 11, 1997
------------------
(SEAL)
===============================
AGIE S. NAVARRO
[SEAL] COMM. #1009257
Notary Public--California
SONOMA COUNTY
My Comm. Expires NOV 11, 1997
===============================
<PAGE>
[LOGO] PAY PROCEEDS LETTER
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
We hereby authorize you to pay the following Payee(s) from the proceeds of
your financial accommodations to us in respect of that certain True Lease
Schedule No. 32053-00001 dated as of DECEMBER 19, 1995, and make disbursements
directly to said Payee(s) as follows:
Amount of
PAYEE Payment
Optical Coating Laboratory, Inc. $ 5,837,402.90
- ---------------------------------------------------- -------------------------
Fleet credit Corporation (Short Fund Advance Rental) 62,597.10
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
TOTAL: $ 5,900,000.00
--------------------
Dated as of: DECEMBER 19, 1995
OPTICAL COATING LABORATORY, INC.
By: /s/ John M. Markovich
------------------------------
Name: John M. Markovich
----------------------------
Title: VP Finance & CFO
---------------------------
This is counterpart No. 2 of a total of 2 counterparts. Only counterpart No. 1
shall be considered chattel paper for purposes of the Uniform Commercial Code
and a security interest may be perfected only by possession of counterpart No.
1.
<PAGE>
FLEET CREDIT CORPORATION
CONSENT AND WAIVER
(OWNER, LANDLORD OR MORTGAGEE OF REAL ESTATE)
50 Kennedy Plaza
Providence, Rhode Island 02903
The undersigned, Aid Association for Lutherans, 4321 North Ballard Road
Appleton, Wisconsin 54919 is the owner, landlord or mortgagee of the premises
located at 2789 North Point Parkway a/k/a 1405 Thunderbolt Way, Santa Rosa,
California 95407 (the "Premises") which are occupied by Optical Coating.
The undersigned acknowledges that Customer has leased or financed, or
that Customer expects hereto, including any accessories, additions,
substitutions or replacements therefor, which may from time to time be located
at the Premises. To induce FCC to enter into a lease or financing agreement with
Customer, the undersigned agrees with FCC as follows:
The undersigned waives any right, title or interest in or to the
Equipment thay it may now or hereafter have. The undersigned
irrevocably agrees and consents that it will refrain from taking any
action to bar, restrain or otherwise prevent FCC, its agents,
successors or assigns, from entering the Premises for The purpose of
inspecting, removing or taking possession of the Equipment, and will
grant FCC, its agents, successors or assigns the right of entry to the
Premises to remove the equipment at any reasonable time or times, FCC
shall be responsible for any damage to the Premises that FCC causes in
connection with its entry thereon and the removal of the Equipment
therefrom. The Equipment is and shall remain personal property,
notwithstanding the manner in which It may be installed or affixed to
the Premises.
This Consent and Waiver shall inure to the benefit of the successors
and assigns of FCC and shall be binding upon the heirs, representatives,
successors and assigns of the undersigned. The undersigned will, upon the
request and at the expense of FCC, execute and deliver to FCC such further and
additional documents as FCC may reasonably deem necessary or desirable to effect
waivers and consents contemplated hereby. This Agreement shall be govened by and
construed in accordance with the laws of the state in which the premises are
located, without reference to principles of conflict of laws.
IN WITNESS WHEREOF, the undersigned has duly executed this Consent and
Waiver this 20th day of December, 1995.
Aid Association for Lutherans
By: /s/ Kenneth E. Podell By: /s/ Frederick J. Russler
-------------------------- --------------------------------
Kenneth E. Podell Title: Assistant Vice President--
Assistant Secretary ----------------------------
Mortgages & Real Estate
<PAGE>
ACKNOWLEDGEMENT TO BE MADE BY OWNER,
LANDLORD OR MORTGAGEE OF REAL ESTATE
(Hereinafter referred to as "Undersigned")
[INDIVIDUAL)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this ___________ day of ____________________, 19__ personally appeared before me
___________________________, Undersigned in the foregoing Consent and Waiver, to
me personally well known and known to the person who signed said Consent and
Waiver, who, being by me duly sworn and being informed of the contents of said
Consent and Waiver stated and acknowledged on oath that he signed, executed,
sealed and delivered same as his free and voluntary act and deed, for the uses,
purposes and considerations therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(PARTNERSHIP)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this day ___________ of ____________________, 19__ personally appeared before me
___________________________ and ___________________________, who executed the
foregoing Consent and Waiver, to me personally well known and known to the
persons who signed said Consent and Waiver, and known to be and who, being by me
duly sworn and being informed of the contents of said Consent and Waiver, stated
and acknowledged on oath that they were Partners of ____________________________
__________________, the Partnership named in and which executed the said Consent
and Waiver, and that they signed, executed, sealed and delivered same
individually and in behalf of the said Partnership, with authority as their and
its free and voluntary act and deed for the uses, purposes and considerations
therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(CORPORATION)
STATE OF WISCONSIN
-----------------
SS.
COUNTY OF OUTAGAMIE
-----------------
I, Ruth M. Mueller, a Notary Public within and for said County, in
the State aforesaid, duly commissioned and acting, do hereby certify that on
this 22nd day of December, 1995 personally appeared before me Frederick J.
Russler and Kenneth E. Podell (Name of Signer for Undersigned) to me personally
well known and known to me to be the person who signed the foregoing Consent and
Waiver, and known to me to be and who, being by me duly sworn and being informed
of the contents of said Consent and Waiver, stated and acknowledged to me an
oath that he was Asst. V.P.-Mortgages & Real Estate & Asst. Secretary (Title) of
Aid Association for Lutherans, the Corporation named in and which executed said
Consent and Waiver, and that he knows the corporate seal of said Corporation,
and that the seal affixed to said Consent and Waiver is the corporate seal of
said Corporation, that he was duly authorized to execute said Consent and
Waiver, for, in the name of and on behalf of said Corporation, and that same was
signed, sealed, executed and delivered by him in the name of and on behalf of
said Corporation by authority of its Board of Directors and that the execution
of said Consent and Waiver was his free and voluntary act and deed in his said
capacity and acknowledged to me that said Corporation executed the same as its
voluntary act and deed and was by him voluntarily executed, on behalf of said
Corporation for the uses, purposes and considerations therein mentioned and set
forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires 7-27-97 Ruth M. Mueller
----------------- --------------------
(Notary Public)
(Seal)
[LOGO] Fleet STIPULATED LOSS VALUE SCHEDULE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Stipulated Loss Value Schedule (this "Schedule") is attached to
and made a part of that certain Lease Schedule No. 32089-00001, dated as of June
19, 1996 (the "Lease Schedule"), by and between the undersigned parties.
<TABLE>
The following Stipulated Loss Values shall be used to calculate damages
or loss as provided in the Master Lease. The Stipulated Loss Value with respect
to any item of Equipment on any Rental Payment Date during the Lease Term shall
be an amount equal to the sum of: (a) all Rental Payments and other amounts then
due and owing to Lessor under the Lease, together with all accrued interest and
late charges thereon, calculated through and including the date of payment; plus
(b) the product of the Acquisition Cost of the such Equipment multiplied by the
percentage set forth below as of such Rental Payment Date.
<CAPTION>
<S> <C> <C> <C>
Rental Payment Date for Percentage of Rental Payment Date for Percentage of
Rental Payment Number Acquisition Cost Rental Payment Number Acquisition Cost
</TABLE>
SEE EXHIBIT C ATTACHED HERETO AND MADE A PART HEREOF
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
EXHIBIT C
TO
STIPULATED LOSS VALUE SCHEDULE
TO LEASE SCHEDULE NO. 32089-01
RENTAL PAYMENT PERCENTAGE OF RENTAL PAYMENT PERCENTAGE OF
DATE FOR RENTAL ACQUISITION COST DATE FOR RENTAL ACQUISITION COST
PAYMENT NUMBER PAYMENT NUMBER
37 70.90880090
1 103.35121715 38 69.75511355
2 102.77715752 39 68.59002020
3 102.19526265 40 67.41874422
4 101.59552206 41 66.23597391
5 100.98781724 42 65.04165152
6 100.37210821 43 63.84099969
7 99.73838360 44 62.62870597
8 99.09652408 45 61.40471189
9 98.44648879 46 60.16895869
10 97.78823666 47 58.92972240
11 97.11575495 48 57.67865042
12 96.43494366
49 56.42401842
13 95.54711438 50 55.15747340
14 94.34921445 51 53.87895553
15 93.74119331 52 52.59673978
16 92.81702863 53 51.30247247
17 91.88261080 54 49.99609306
18 90.93788832 55 48.68587582
19 89.97683797 56 47.36346638
20 89.00534921 57 46.02880349
21 88.02336959 58 44.68182560
22 87.03084644 59 43.33120369
23 86.02873119 60 41.96818663
24 85.01597126
61 40.60144498
25 83.99351758 62 39.22222721
26 82.96031708 63 37.83047065
27 81.91631576 64 36.43484516
28 80.86246378 65 35.02659847
29 79.79770726 66 33.60566720
30 78.72199142 67 32.18072044
31 77.63626563 68 30.74300521
32 76.53947521 69 29.29245738
33 75.43156457 70 27.82901249
34 74.31247787 71 26.37095856
35 73.18743961 72 24.89996987
36 72.05113926
72 25.00000000
<PAGE>
[LOGO] Fleet PURCHASE OPTION RIDER
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (this "Rider") is attached to and made a
part of that certain Lease Schedule No. 32089-00001, dated as of June 19, 1996
(the "Lease Schedule"), by and between the undersigned parties.
If no Event of Default (or event or condition which, with the passage
of time or giving of notice, or both, would become such an Event of Default)
shall have occurred and be continuing, and the Lease shall not have been earlier
terminated, Lessee shall have the option to purchase (the "Purchase Option")
all, but not less than all, of the Equipment at the expiration of the Lease Term
for an amount, payable in immediately available funds on the last day of the
Lease Term, equal to: (a) all Rental Payments, late charges and other amounts
due and owing under the Lease; plus (b) all taxes, assessments and other charges
due or payable in connection with the sale of the Equipment to Lessee; plus (c)
an amount equal to 25.00000% of the Acquisition Cost of the Equipment, which
Lessor and Lessee acknowledge represents a reasonable current estimate of the
fair market value of the Equipment at the end of the Lease Term.
Provided that Lessor shall have received all amounts payable hereunder
on the last day of the Lease Term, and that no Event of Default then exists and
is continuing under the Lease, Lessor shall convey all of its right, title and
interest in and to the Equipment to Lessee on the last day of the Lease Term, on
an "AS-IS," "WHERE-IS" BASIS WITHOUT REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, and without recourse to Lessor, except that the Equipment shall be free
and clear of all liens created by Lessor. If Lessee intends to exercise the
Purchase Option, Lessee shall give irrevocable written notice to Lessor (the
"Option Notice") not more than 240 days, nor less than 180 days, prior to the
expiration of the Lease Term. If Lessee fails to give such written notice to
Lessor, it shall be conclusively presumed that Lessee has elected not to
exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 5.0 % of the Acquisition Cost
of the Equipment.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
[LOGO] Fleet WARRANTY BILL OF SALE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903
FLEX PRODUCTS, INC., ("Seller") of 1402 MARINER WAY SANTA ROSA, CA
95407, in consideration of the sum of $7,879,000.00 Dollars, and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, does hereby sell, transfer and assign to Fleet Capital Corporation
("FCC") a Rhode Island corporation having its principal office at 50 Kennedy
Plaza, Providence, Rhode Island 02903, the equipment set forth in Schedule A
hereto (the "Equipment").
Seller hereby covenants with and warrants to FCC that Seller is the
lawful owner of the Equipment and has the right to sell the Equipment, and that
the Equipment is free and clear of all rights, claims, liens, charges, security
interests or encumbrances of any other person. Seller will forever indemnify,
defend and warrant all of the rights of FCC in and to the Equipment transferred
hereunder against the claims and demands of all other persons.
IN WITNESS WHEREOF, Seller has duly executed this Bill of Sale this 11th day of
July, 1996.
FLEX PRODUCTS, INC.
By: /s/ Michael B. Sullivan
--------------------------------
Name: Michael B. Sullivan
------------------------------
Title: President
-----------------------------
State of California
--------------------------
County of Sonoma
--------------------------
Subscribed and sworn before me this 11th day of July, 1996.
/s/ Aggie S. Navarro
Notary Public
My Commission expires:________________
==============================
AGIE S. NAVARRO
[SEAL] COMM. #1009257
Notary Public--California
SONOMA COUNTY
My Comm. Expires NOV 11, 1997
==============================
<PAGE>
FLEET CREDIT CORPORATION
CONSENT AND WAIVER
(OWNER, LANDLORD OR MORTGAGEE OF REAL ESTATE)
50 Kennedy Plaza
Providence, Rhode Island 02903
The undersigned, Aid Association for Lutherans, 4321 North Ballard Road
Appleton, Wisconsin 54919 is the owner, landlord or mortgagee of the premises
located at 1402 Mariner Way, Santa Rosa California 95407 (the "Premises") which
are occupied by Flex Products, Inc.
The undersigned acknowledges that Customer has leased or financed, or
that Customer expects to lease or finance from Fleet Credit Corporation ("FCC"),
the Equipment set forth on Schedule A hereto, including any accessories,
additions, substitutions or replacements therefor, which may from time to time
be located at the Premises. To induce FCC to enter into a lease or financing
agreement with Customer, the undersigned agrees with FCC as follows:
The undersigned waives any right, title or interest in or to the
Equipment that it may now or hereafter have. The undersigned
irrevocably agrees and consents that it will refrain from taking any
action to bar, restrain or otherwise prevent FCC, its agents,
successors or assigns, from entering the Premises for the purpose of
inspecting, removing or taking possession of the Equipment, and will
grant FCC, its agents, successors or assigns the right of entry to the
Premises to remove the Equipment at any reasonable time or times. FCC
shall be responsible for any damage to the Premises that FCC causes in
connection with its entry thereon and the removal of the Equipment
therefrom. The Equipment is and shall remain personal property,
notwithstanding the manner in which it may be installed or affixed to
the Premises.
This Consent and Waiver shall inure to the benefit of the successors
and assigns of FCC and shall be binding upon the heirs, representatives,
successors and assigns of the undersigned. The undersigned will, upon the
request and at the expense of FCC, execute and deliver to FCC such further and
additional documents as FCC may reasonably deem necessary or desirable to effect
waivers and consents contemplated hereby. This Agreement shall be governed by
and construed in accordance with the laws of the state in which the premises are
located, without reference to principles of conflict of laws.
IN WITNESS WHEREOF, the undersigned has duly executed this Consent and
Waiver this ___ day of April, 1996.
AID ASSOCIATION F0R LUTHERANS
/s/ Bonnie L. Hietpas By: /s/ Wayne C. Streck
- ------------------------ -----------------------------------------
(Witness) Wayne C. Streck
Title: Vice President-Mortgages & Real Estate
---------------------------------------
/s/ Janice A. Schuette By: /s/ Kenneth E. Podell
- ------------------------ -----------------------------------------
(Witness) Kenneth E. Podell
Assistant Secretary
<PAGE>
ACKNOWLEDGEMENT TO BE MADE BY OWNER,
LANDLORD OR MORTGAGEE OF REAL ESTATE
(Hereinafter referred to as "Undersigned")
[INDIVIDUAL)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this day ______ of ____________________, 19__ personally appeared before me
__________________________, Undersigned, in the foregoing Consent and Waiver, to
me personally well known and known to the person who signed said Consent and
Waiver, who, being by me duly sworn and being informed of the contents of said
Consent and Waiver stated and acknowledged on oath that he signed, executed,
sealed and delivered same as his free and voluntary act and deed, for the uses,
purposes and considerations therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(PARTNERSHIP)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this day ___________ of ____________________, 19__ personally appeared before me
___________________________ and _________________________________ who executed
the foregoing Consent and Waiver, to me personally well known and known to the
person who signed said Consent and Waiver, and known to be and who, being by me
duly sworn and being informed of the contents of said Consent and Waiver stated
and acknowledged on oath that they were Partners of ____________________________
_______________________________________________________________________________,
the Partnership named in and which executed the said Consent and Waiver, and
that they signed, executed, sealed and delivered same individually and in behalf
of the said Partnership, with authority as their and its free and voluntary act
and deed for the uses, purposes and considerations therein mentioned and set
forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(CORPORATION)
STATE OF WISCONSIN
-----------------
SS.
COUNTY OF OUTAGAMIE
-----------------
I, David Crist, a Notary Public within and for said County, in the
State aforesaid, duly commissioned and acting, do hereby certify that on this
18th day of April, 1996 personally appeared before me Wayne C. Streck and
Kenneth E. Podell (Name of Signer for Undersigned), to me personally well known
and known to me to be the person who signed the foregoing Consent and Waiver,
and known to me to be and who, being by me duly sworn and being informed of the
contents of said Consent and Waiver stated and acknowledged on oath that they
are Vice President-Mortgages and Real Estate & Assistant Secretary of Aid
Association for Lutherans the Corporation named in and which executed the said
Consent and Waiver, and that he knows the corporate seal of said Corporation,
and that the seal affixed to said Consent and Waiver is the corporate seal of
said Corporation, that he was duly authorized to execute said Consent and
Waiver, for, in the name of and on behalf of said Corporation, and that same was
signed, sealed, executed and delivered by him in the name of and on behalf of
said Corporation by authority of its Board of Directors and that the execution
of said Consent and waiver was his free and voluntary act and deed in his said
capacity and acknowledged to me that said Corporation executed the same as its
voluntary act and deed and was by him voluntarily executed, on behalf of said
Corporation for the uses, purposes and considerations therein mentioned and set
forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires is permanent. /s/ David Crist
----------------- --------------------
(Notary Public)
(Seal)
<PAGE>
FLEET CREDIT CORPORATION PAGE 3 OF 3
Schedule A Equipment
- --------------------------------------------------------------------------------
Manufacturer, Description
- --------------------------------------------------------------------------------
WPH overhead wire rope crane, model 1 1/2 ton, serial W6022015, approximately
X-Y, travel is 55' X 35' X 40'.
Kinney vacuum rotary pump, model KT-505-LP, serial 3011-2 with a dresser roots
booster blower, 15 HP., model HV3000, serial H00224, 480 volts.
Kinney vacuum rotary pump, model KT-505-LP, serial 3011-1 with a dresser root
booster blower, 15 HP., model HV3000, serial H00219.
Dresser roots, 30 HP. booster pump.
(4) Emergency isolation switches.
(3) 5.5 Bar pneumatic actuator valves.
Solenoids.
Alfa laval heat exchanger, Mfg. 1995, serial 30102-86367.
(4) Weksler temperature gauges, 0-150F deg.
Raven round Polypro storage tank, approximately
6' X 4' diameter, serial G333465.
Approximately 60 feet of 4" 304 stainless steel seamless
piping with connectors.
(2) ITT Bell & Gossett pumps, series 1510, 20 HP., 200 GPM, model 21/2AB7000BF,
serials 1955295 and 1955296.
(2) FSI filter columns, stainless steel, Mfg. 1995, 10 micron filters, serial
38121, 150 PSI.
Air storage tank 4'X 2' diameter with a 0-160 PSI gauge.
Miscellaneous spare parts.
And a11 standard and accessory Equipment.
- --------------------------------------------------------------------------------
<PAGE>
FLEET CREDIT CORPORATION PAGE 2 OF 3
Schedule A Equipment
- --------------------------------------------------------------------------------
Manufacturer, Description
- --------------------------------------------------------------------------------
(2) Bell & Gosett pumps, models 114RC925, series 1510, serials 1955297 and
1955296.
Raven polypro tank, approximately 5' X 2', diameter.
(2) Bell & Gosett pumps, model 4BC9375, serial 1957959 and 1957960, 625 GPM.
Alfa laval heat exchanger, type M6-FG, serial 3010286368 with (4) 0-150 degree
gauges.
Alfa 1ave1 heat exchanger, type M10-BFG, serial 30102-86369 with (4) 0-150
degree gauges.
FSI water filter, model FSP-4ON-4-304SS, Mfg. 1995. 10 micron with 0-160 PSI
gauge.
Dual water cooling condensing system, low pressure, high pressure with (2) KSB
pumps, model ETACHROMB, valves, solenoids.
(2) Edwards two stage vacuum pumps, model 275.
Air storage tank 4' X 2' diameter with 0-160 PSI gauge.
Water filter systems with (2) KSB ETACHROM-B-40160562, pumps, 2200 gallon round
stainless steel tank, model BT33541.
Approximately 60' X 4" stainless steel piping with fittings.
Approximately 100' of 2" stainless steel piping with fittings.
BETA FIVE:
General Vacuum Equipment Corp. electron beam metalyzing system, Mfg. 1995, 78"
width capacity, 1200 feet per minute, 480 volt, 3 phase, 218 amps., model
95-005, overall size 9' X 10', serial W9827-95.
SERIAL NUMBER _________________-
CONSISTING OF BUT NOT LIMITED TO:
(8) Electron beam guns.
(8) Airco Temescal Simba 2 electron beam power supplies, serials 330,
337, 340, 338, 339, 336, 333 and 335.
(8) Programmable sweep generators.
(8) High voltage controllers.
(8) Electron beam gun controllers.
(2) Polycolds, model PFC1100HC.
(6) Varian 20" diffusion pumps, model 016513/HS-20.
(8) Airco electron beam gun interfaces.
(4) Trige-Scott drive motors, model S90L01199100203050300011
serials 104529421295, 104529211295, 104529311295 and 104529411295.
- --------------------------------------------------------------------------------
<PAGE>
FLEET CREDIT CORPORATION PAGE 1 OF 3
Schedule A Equipment
Attached to and made part of the following documents: Consent and Waiver (Owner,
Landlord or Mortgagee of Real Estate) with Flex Products, Inc. 32089-01 and
32089-02.
- --------------------------------------------------------------------------------
Manufacturer, Description
- --------------------------------------------------------------------------------
The Equipment is Currently Located at:
1402 Mariner Way
Santa Rosa, California 95407
BETA THREE:
Weinert Vacuum GMBH. sputtering roll coating machine, Mfg. 1995, 7' X 10'
chamber size, 480 volt, 3 phase, all stainless steel construction.
SERIAL NUMBER _______________
CONSISTING OF BUT NOT LIMITED TO:
(6) 20" diffusion pumps.
(4) 16" diffusion pumps.
3 Chamber system.
Liebert UPS battery back-up system, model AP331, serial P21174SF.
(3) Polycold cooling systems, model PFC-1100ST.
(3) Cathodes.
(2) Aluminum sputtering cathodes.
(6) Transformers, 72 kilowatt.
Edwards two stage vacuum pump, model 275.
(3) Edwards two stage vacuum pumps, model 80.
(6) ENI D.C Plasma generators model DCG-100.
Allen Bradley controls.
(2) Mapping monitors.
(2) Control monitors.
PLC'S.
Circulation pumps.
Hydraulic pumps.
Other various monitors.
Miscellaneous spare parts.
- --------------------------------------------------------------------------------
FLEET CREDIT CORPORATION AID ASSOCIATION FOR LUTHERANS
By: /s/ John J. Gould By: /s/ Wayne C. Streck
- ------------------------ -----------------------------------------
Name: John J. Gould Name: Wayne C. Streck
- ------------------------ -----------------------------------------
Title: Vice President Title: Vice President-Mortgages & Real Estate
---------------------------------------
By: /s/ Kenneth E. Podell
-----------------------------------------
Kenneth E. Podell
<PAGE>
FLEET CREDIT CORPORATION
CONSENT AND WAIVER
(OWNER, LANDLORD OR MORTGAGEE OF REAL ESTATE)
50 Kennedy Plaza
Providence, Rhode Island 02903
The undersigned, Aid Association for Lutherans , 4321 North Ballard
Road Appleton, Wisconsin 54919 is the owner, landlord or mortgagee of the
premises located at 1402 Mariner Way , Santa Rosa California 95407 (the
"Premises") which are occupied by Flex Products, Inc.
The undersigned acknowledges that Customer has leased or financed, or
that Customer expects to lease or finance from Fleet Credit Corporation ("FCC"),
the Equipment set forth on Schedule A hereto, including any accessories,
additions, substitutions or replacements therefor, which may from time to time
be located at the Premises. To induce FCC to enter into a lease or financing
agreement with Customer, the undersigned agrees with FCC as follows:
The undersigned waives any right, title or interest in or to the
Equipment that it may now or hereafter have. The undersigned
irrevocably agrees and consents that it will refrain from taking any
action to bar, restrain or otherwise prevent FCC, its agents,
successors or assigns, from entering the Premises for the purpose of
inspecting, removing or taking possession of the Equipment, and will
grant FCC, its agents, successors or assigns the right of entry to the
Premises to remove the Equipment at any reasonable time or times. FCC
shall be responsible for any damage to the Premises that FCC causes in
connection with its entry thereon and the removal of the Equipment
therefrom. The Equipment is and shall remain personal property,
notwithstanding the manner in which it may be installed or affixed to
the Premises.
This Consent and Waiver shall inure to the benefit of the successors
and assigns of FCC and shall be binding upon the heirs, representatives,
successors and assigns of the undersigned. The undersigned will, upon the
request and at the expense of FCC, execute and deliver to FCC such further and
additional documents as FCC may reasonably deem necessary or desirable to effect
waivers and consents contemplated hereby. This Agreement shall be governed by
and construed in accordance with the laws of the state in which the premises are
located, without reference to principles of conflict of laws.
IN WITNESS WHEREOF, the undersigned has duly executed this Consent and
Waiver this 18th day of April, 1996 .
AID ASSOCIATION F0R LUTHERANS
/s/ Bonnie L. Hietpas By: /s/ Wayne C. Streck
- -------------------------- -----------------------------------------
(Witness) Wayne C. Streck
Title: Vice President-Mortgages & Real Estate
---------------------------------------
/s/ Janice A. Schuette By: /s/ Kenneth E. Podell
- -------------------------- -----------------------------------------
(Witness) Kenneth E. Podell
Assistant Secretary
<PAGE>
ACKNOWLEDGEMENT TO BE MADE BY OWNER,
LANDLORD OR MORTGAGEE OF REAL ESTATE
(Hereinafter referred to as "Undersigned")
[INDIVIDUAL)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this ___________ day of ____________________, 19__ personally appeared before me
___________________________, Undersigned in the foregoing Consent and Waiver, to
me personally well known and known to the person who signed said Consent and
Waiver, who, being by me duly sworn and being informed of the contents of said
Consent and Waiver stated and acknowledged on oath that he signed, executed,
sealed and delivered same as his free and voluntary act and deed, for the uses,
purposes and considerations therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(PARTNERSHIP)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this ___________ day of ____________________, 19__ personally appeared before me
___________________________ and _________________________________ who executed
the foregoing Consent and Waiver, to me personally well known and known to the
person who signed said Consent and Waiver, and known to be and who, being by me
duly sworn and being informed of the contents of said Consent and Waiver, stated
and acknowledged on oath that they were Partners of ____________________________
_______________________________________________________________________________,
the Partnership named in and which executed the said Consent and Waiver, and
that they signed, executed, sealed and delivered same individually and in behalf
of the said Partnership, with authority as their and its free and voluntary act
and deed for the uses, purposes and considerations therein mentioned and set
forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(CORPORATION)
STATE OF WISCONSIN
-----------------
SS.
COUNTY OF OUTAGAMIE
-----------------
I, David Crist, a Notary Public within and for said County, in the
State aforesaid, duly commissioned and acting, do hereby certify that on this
18th day of April, 1996 personally appeared before me Wayne C. Streck and
Kenneth E. Podell (Name of Signer for Undersigned), to me personally well known
and known to me to be the person who signed the foregoing Consent and Waiver,
and known to me to be and who, being by me duly sworn and being informed of the
contents of said Consent and Waiver stated and acknowledged on oath that they
are Vice President-Mortgages and Real Estate & Assistant Secretary of Aid
Association for Lutherans the Corporation named in and which executed the said
Consent and Waiver, and that he knows the corporate seal of said Corporation,
and that the seal affixed to said Consent and Waiver is the corporate seal of
said Corporation, that he was duly authorized to execute said Consent and
Waiver, for, in the name of and on behalf of said Corporation, and that same was
signed, sealed, executed and delivered by him in the name of and on behalf of
said Corporation by authority of its Board of Directors and that the execution
of said Consent and waiver was his free and voluntary act and deed in his said
capacity and acknowledged to me that said Corporation executed the same as its
voluntary act and deed and was by him voluntarily executed, on behalf of said
Corporation for the uses, purposes and considerations therein mentioned and set
forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires is permanent. /s/ David Crist
----------------- --------------------
(Notary Public)
(Seal)
<PAGE>
FLEET CREDIT CORPORATION PAGE 3 OF 3
Schedule A Equipment
- --------------------------------------------------------------------------------
Manufacturer, Description
- --------------------------------------------------------------------------------
WPH overhead wire rope crane, model 1 1/2 ton, serial W6022015, approximately
X-Y, travel is 55' X 35' X 40' .
Kinney vacuum rotary pump, model KT-505-LP, serial 3011-2 with a dresser
roots booster blower, 15 HP., model HV3000, serial H00224, 480 volts.
Kinney vacuum rotary pump. model KT-505-LP, serial 3011-1 with a dresser root
booster blower, 15 HP., model HV3000, serial H00219.
Dresser roots, 30 HP. booster pump.
(4) Emergency isolation switches.
(3) 5.5 Bar pneumatic actuator valves.
Solenoids.
Alfa laval heat exchanger, Mfg. 1995, serial 30102-86367.
{4) Weksler temperature gauges, 0-150F deg.
Raven round Polypro storage tank, approximately
6' X 4' diameter, serial G333465.
Approximately 60 feet of 4" 304 stainless steel seamless piping with connectors.
(2)ITT Bell & Gossett pumps, series 1510, 20 HP., 200 GPM, model 21/2AB7000BF,
serials 1955295 and 1955296.
(2)FSI filter columns, stainless steel, Mfg. 1995, 10 micron filters, serial
38121, 150 PSI.
Air storage tank 4' X 2' diameter with a 0-160 PSi gauge.
Miscellaneous spare parts.
And all standard and accessory Equipment.
<PAGE>
FLEET CREDIT CORPORATION PAGE 2 OF 3
Schedule A Equipment
- --------------------------------------------------------------------------------
Manufacturer, Description
- --------------------------------------------------------------------------------
(2) Bell & Gosett pumps, models 114RC925, series 1510, serials 1955297 and
1955296.
Raven polypro tank, approximately 5' X 2' diameter.
(2) Bell & Gosett pumps, model 4BC9375, serial 1957959 and 1957960, 625 GPM.
Alfa laval heat exchanger, type M6-FG, serial 3010286368 with (4) 0-150 deg.
gauges.
Alfa laval heat exchanger, type M10-BFG, serial 3.0102-86369 with (4) 0-150 deg.
gauges.
FSI water filter, model FSP-4ON-4-304SS, Mfg. 1995, 10 micron with 0-160 PSI
gauge.
Dual water cooling condensing system, low pressure, high pressure with (2) KSB
pumps, model ETACHROMB, valves, solenoids.
(2) Edwards two stage vacuum pumps, model 275.
Air storage tank 4' X 2' diameter with 0-160 PSI gauge.
Water filter system with (2) KSB ETACHROM-B-40160562, pumps, 2200 gallon round
stainless steel tank, model BT33541.
Approximately 60' X 4" stainless steel piping with fittings.
Approximately 100' of 2" stainless steel piping with fittings.
BETA FIVE:
General Vacuum Equipment Corp. electron beam metalyzing system, Mfg. 1995, 78"
width capacity 1200 feet per minute, 480 volt, 3 phase, 218 amps., model 95-005,
overall size 9' X 10' , serial W9827-95.
SERIAL NUMBER:
CONSISTING OF BUT NOT LIMITED TO:
(8) Electron beam guns.
(8) Airco Temescal Simba 2 electron beam power supplies, serials 330, 337, 340,
338, 339, 336, 333 and 335.
(8) High voltage controllers.
(8) Electron beam gun controllers.
(2) Polycolds, model PFC1100HC.
(6) Varian 20" diffusion pumps, model 016513/HS-20.
(8) Airco electron beam gun interfaces.
(4) Trigo-Scott drive motors, model 590L01199100203050300011
serials 104529421295, 104529211295, 104529311295 and 104529411295.
<PAGE>
FLEET CREDIT CORPORATION PAGE 1 OF 3
Schedule A Equipment
Attached to and made part of the following documents Consent and Waiver (Owner,
Landlord or Mortgagee of Real Estate) with Flex Products, Inc. 32089-01 and
32089-02.
- --------------------------------------------------------------------------------
Manufacturer, Description
- --------------------------------------------------------------------------------
The Equipment is Currently Located at:
1402 Mariner Way
Santa Rosa, California 95407
BETA THREE:
Weinert Vacuum GMBH. sputtering roll coating machine,
Mfg. 1995, 7' X 10' chamber size, 480 volt, 3 phase,
all stainless steel construction.
SERIAL NUMBER _________________________________
CONSISTING OF BUT NOT LIMITED TO:
(6) 20" diffusion pumps.
(4) 16" diffusion pumps.
3 Chamber system.
Liebert UPS battery back-up system, model AP331, serial P21174SF.
(3) Polycold cooling systems, model PFC-1100ST.
(3) Cathodes.
(2) Aluminum sputtering cathodes.
(6) Transformers, 72 kilowatt, Edwards two stage vacuum pump, model 275.
(3) Edwards two stage vacuum pumps, model 80.
(6) ENI D.C Plasma generators model DCG-100.
Allen Bradley controls.
(2) Mapping monitors.
(2) Control monitors.
PLC'S.
Circulation pumps.
Hydraulic pumps.
Other various monitors.
Miscellaneous spare parts.
FLEET CREDIT CORPORATION AID ASSOCIATION FOR LUTHERANS
By: /s/ John J. Gould By: /s/ Wayne C. Streck
-------------------- -----------------------------------------
Name: John J. Gould Name: Wayne C. Streck
-------------------- -----------------------------------------
Title: Vice President Title Vice President-Mortgages & Real Estate
-------------------- -----------------------------------------
By: /s/ Kenneth E. Podell
-----------------------------------------
Kenneth E. Podell
<PAGE>
[LOGO] Fleet LEASE SCHEDULE NO. 32089-00002
Capital Leasing (True Lease Schedule)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
Lessee: FLEX PRODUCTS, INC.
Address: 1402 MARINER WAY
SANTA ROSA, CA 95407
1. This Lease Schedule No. 32089 - 00002 dated as of June 19, 1996 is
entered into pursuant to and incorporates by this reference, all of the terms
and provisions of that certain Master Equipment Lease Agreement No. 32089 dated
as of JUNE 19, 1996 (the "Master Lease"), for the lease of the Equipment
described in Schedule A attached hereto. This Lease Schedule shall constitute a
separate, distinct and independent lease of the Equipment and the contractual
obligation of Lessee. References to the "the Lease" or "this Lease" shall mean
and refer to this Lease Schedule, together with the Master Lease and all
exhibits, addenda, schedules, certificates, riders and other documents and
instruments executed and delivered in connection with this Lease Schedule, all
as the same may be amended or modified from time to time. All capitalized terms
used herein and not defined herein shall have the meanings set forth or
referred to in the Master Lease. By its execution and delivery of this Lease
Schedule, Lessee hereby reaffirms all of the representations, warranties and
covenants contained in the Master Lease, as of the date hereof, and further
represents and warrants to Lessor that no Event of Default, and no event or
condition which with notice or the passage of time or both would constitute an
Event of Default, has occurred and is continuing as of the date hereof.
2. ACQUISITION COST. The Acquisition Cost of the Equipment is:
$4,500,000.00.
3. (a) LEASE TERM. The Lease Term shall commence on the date hereof and
shall continue for a period of 72 months after the Lease Term Commencement Date
set forth in the Acceptance Certificate to this Lease Schedule, plus any renewal
or extended term applicable in accordance with the terms of the Lease.
(b) RENTAL PAYMENTS. In addition to interim rent payable pursuant
to Section 2 of the Master Lease, Lessee shall pay Lessor 72 consecutive Rental
Payments in the amounts set forth in the schedule below, plus any applicable
sales/use taxes, commencing on the Rental Payment Commencement Date set forth
in the Acceptance Certificate and MONTHLY thereafter for the remaining Lease
Term. Each Rental Payment shall be payable on the same day of the month as the
Rental Payment Date in each succeeding rental period during the remaining Lease
Term (each, a "Rental Payment Date"):
Amount of Each
Number of Rental Payments Rental Payment
------------------------- --------------
12 65,109.74
60 73,780.11
(c) ADVANCE RENTAL PAYMENT. Lessee agrees to pay Lessor the first
01 and last O Rental Payments, due and payable on the Acceptance Date.
<PAGE>
[LOGO] Fleet
Capital Leasing
PAY PROCEEDS LETTER
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
We hereby authorize you to pay the following Payee(s) from the proceeds of
your financial accommodations to us in respect of that certain True Lease
Schedule No. 32089-00002 dated as of June 19, 1996, and make disbursements
directly to said Payee(s) as follows:
Amount of
PAYEE Payment
Flex Products, Inc. * $4,421,390.26
- ---------------------------------------------------- -------------------------
Fleet Capital Corporation (short fund to pay 78,609.74
- ---------------------------------------------------- -------------------------
Customer Invoice now due)
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
TOTAL: $4,500,000.00
--------------------
Dated as of: June 19 , 1996
------------------------
* BANK: Bank of America, NTSA FLEX PRODUCTS, INC.
10 Santa Rosa Ave.
Santa Rosa, CA By: /s/ Michael B. Sullivan
---------------------------
ABA #: 12100358 Name: Michael B. Sullivan
-------------------------
For Account of: FLEX PRODUCTS INC. Title: President
-------------------------
Account #: 14984-00242
<PAGE>
FLEET CAPITAL CORPORATION
50 Kennedy Plaza
Providence, RI 02903-2305
1-800-238-3737
FLEX PRODUCTS, INC.
1402 MARINER WAY
SANTA ROSA CA 95407-0000
July 10, 1996
- --------------------------------------------------------------------------------
DESCRIPTION AMOUNT
- --------------------------------------------------------------------------------
ADVANCE PAYMENT $65,109.74 +
ORIGINATION FEE $30,000.00 +
TRANSACTION EXPENSES $ 8,500.00 +
SH FUND $78,609.74 -
SUB DEP $25,000.00 -
Total Due $103,609.74
Total Received $103,609.74
Balance $0.00
- --------------------------------------------------------------------------------
RETURN YOUR REMITTANCE TO THE ATTENTION OF: SANDRA BUONAIUTO
TO INSURE PROPER CREDIT TO YOUR ACCOUNT, PLEASE RETURN REMITTANCE COPY.
A Subsidiary of Fleet National Bank
32089 00 001 00002
<PAGE>
ACCEPTANCE CERTIFICATE
[LOGO] Fleet
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Acceptance Certificate (this "Acceptance Certificate") is attached
to and made a part of that certain Lease Schedule No. 32089 - 00002, dated as of
June 19, 1996 (the "Lease Schedule"), by and between the undersigned parties.
All capitalized terms used herein and not defined herein shall have the meanings
set forth or referred to in the Lease Schedule. To the extent the terms set
forth in this Acceptance Certificate differ or conflict with any of the terms
set forth in the Lease, the terms set forth in this Acceptance Certificate shall
control.
1. Lessee acknowledges and agrees that each item of Equipment set forth
on Schedule A hereto (collectively, the "Equipment") is hereby unconditionally
accepted by Lessee for all purposes under the Lease at the locations specified
in Schedule A-1 hereto, and hereby agrees to faithfully perform all of its
obligations under the Lease as of the date hereof (the "Acceptance Date").
Lessee hereby authorizes and directs Lessor to make payment to each vendor of
the Equipment pursuant to such vendor's invoice or any purchase order, purchase
agreement or supply contract with such vendor, receipt and approval of which are
hereby reaffirmed by Lessee.
2. By its execution and delivery of this Acceptance Certificate, Lessee
hereby reaffirms all of the representations, warranties and covenants contained
in the Lease as of the date hereof, and further represents and warrants to
Lessor that no Event of Default, and no event or condition which with notice or
the passage of time or both would constitute an Event of Default, has occurred
and is continuing as of the date hereof. Lessee further certifies to Lessor that
Lessee has selected the Equipment and has received and approved the purchase
order, purchase agreement or supply contract under which the Equipment will be
acquired for all purposes of the Lease.
3. Lessee hereby represents and warrants that: (a) the Equipment has been
delivered and is in an operating condition and performing the operation for
which it is intended to the satisfaction of the Lessee; and (b) if requested by
Lessor, the Equipment has been marked or labeled evidencing the Lessor's
interest therein.
4. The LEASE TERM COMMENCEMENT DATE is the 10th day of July, 1996
5. The RENTAL PAYMENT COMMENCEMENT DATE is the 10th day of July, 1996
6. All terms and provisions of the Lease Schedule shall remain in full force and
effect, except as otherwise provided below:
- ACQUISITION COST: $ 4,500,000.00.
- LEASE TERM: (72) seventy-two months.
- RENTAL PAYMENTS: Number of Rental Payments Rental Payment Amount
12 $______
60 $______
- ADVANCE RENTAL PAYMENT(S): First 01 and last 00.
- SECURITY DEPOSIT: N/A %.
Dated: July 10, 1996
Agreed and Accepted:
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
---------------------------- ---------------------------
Name: John J. Gould Name: Michael B. Sullivan
-------------------------- -------------------------
Title: VP/Senior Lender Title: President
-------------------------- -------------------------
<PAGE>
<TABLE>
<CAPTION>
This FINANCING STATEMENT is presented for filing and will remain effective with certain
exceptions for a period of five years from the date of filing pursuant to section 9403 of the
California Uniform Commercial Code.
- ------------------------------------------------------------------------------------------------
<C> <C>
1. DEBTOR (LAST NAME FIRST--IF AN INDIVIDUAL) 1A. SOCIAL SECURITY OR FEDERAL TAX NO.
Flex Products, Inc.
- ------------------------------------------------------------------------------------------------
1B. MAILING ADDRESS 1C. CITY, STATE 1D. ZIP CODE
2793 Northpoint Parkway Santa Rosa, California 95407
- ------------------------------------------------------------------------------------------------
2. ADDITIONAL DEBTOR (IF ANY) 2A. SOCIAL SECURITY OR FEDERAL TAX NO.
(LAST NAME FIRST--IF AN INDIVIDUAL)
- ------------------------------------------------------------------------------------------------
2B. MAILING ADDRESS 2C. CITY, STATE 2D. ZIP CODE
- ------------------------------------------------------------------------------------------------
3. DEBTOR'S TRADE NAMES OR STYLES (IF ANY) 3A. FEDERAL TAX NUMBER
================================================================================================
4. SECURED PARTY 4A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. N0.
NAME FLEET CREDIT CORPORATION
MAILING ADDRESS 50 Kennedy Plaza, 5th Floor
CITY Providence STATE RI ZIP CODE 02903
- ------------------------------------------------------------------------------------------------
5. ASSIGNEE OF SECURED PARTY (IF ANY) 5A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. N0.
NAME
MAILING ADDRESS
CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------
6. This FINANCING STATEMENT covers the following types or items of property (include description
of real property on which located and owner of record when required by instruction 4).
(1) General Vacuum Equipment Corp. electron beam metalyzing system as further described on
attached Schedule A(s) and all additions, accessories, modifications improvements, replacements
substitutions, and accessories thereto and therefor, whether now owned or hereafter acquired,
and proceeds, products and income of any of the foregoing, including insurance proceeds. Debtor
has possession of the equipment under a true lease only. Secured Party has a security interest
in the equipment to the extent necessary to protect its title and interest therein.
Acct. No. 32089-02/lae (Fixture filing)
Sonoma County Exhibit d
- ------------------------------------------------------------------------------------------------
7. CHECK [X] 7A. [ ] PRODUCTS OF COLLATERAL 7B. DEBTOR(S) SIGNATURE NOT REQUIRED IN
IF APPLICABLE ARE ALSO COVERED ACCORDANCE WITH INSTRUCTION 5(a) ITEM:
[ ](1) [ ](2) [ ](3) [ ](4)
- ------------------------------------------------------------------------------------------------
8. CHECK [X] [ ] DEBTOR IS A "TRANSMITTING UTILITY"
IF APPLICABLE IN ACCORDANCE WITH UCC SS. 9105 (1)(n)
- ------------------------------------------------------------------------------------------------
9. DATE: C 10. THIS SPACE FOR USE OF FILING OFFICER
O (DATE, TIME, FILE NUMBER
/s/ Michael B. Sullivan 7/11/96 D AND FILING OFFICER)
SIGNATURE(S) OF DEBTOR(S) E
- -------------------------------------------------- ---
Flex Products, Inc. 1
TYPE OR PRINT NAME(S) OF DEBTOR(S) 2
- --------------------------------------------------
3 JUL 23, 1996
/s/ Sandra Burnett
SIGNATURE(S) OF SECURED PARTY (IES) 4
- -------------------------------------------------- 96-65549
FLEET CAPITAL C0RPORATION 5
TYPE OR PRINT NAME(S) OF SECURED PARTY (IES) 6 CONF0RMED COPY
================================================== NOT COMPARED
11. Return copy to: 7 WITH ORIGINAL
SONOMA COUNTY
NAME PARASEARCH INC. 8
ADDRESS 222 Jefferson Blvd.
CITY Warwick, RI 02688 9
STATE
ZIP CODE 0
==================================================
Filing Officer is requested to note file number,
date and hour of filing on this copy and return to
the above party
FORM UCC.1--
Approved by the Secretary of State
==================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
This FINANCING STATEMENT is presented for filing and will remain effective with certain
exceptions for a period of five years from the date of filing pursuant to section 9403 of the
California Uniform Commercial Code.
- ------------------------------------------------------------------------------------------------
<C> <C>
1. DEBTOR (LAST NAME FIRST--IF AN INDIVIDUAL) 1A. SOCIAL SECURITY OR FEDERAL TAX NO.
Flex Products, Inc.
- ------------------------------------------------------------------------------------------------
1B. MAILING ADDRESS 1C. CITY, STATE 1D. ZIP CODE
1402 Mariner Way Santa Rosa, California 95407
- ------------------------------------------------------------------------------------------------
2. ADDITIONAL DEBTOR (IF ANY) 2A. SOCIAL SECURITY OR FEDERAL TAX NO.
(LAST NAME FIRST--IF AN INDIVIDUAL)
- ------------------------------------------------------------------------------------------------
2B. MAILING ADDRESS 2C. CITY, STATE 2D. ZIP CODE
- ------------------------------------------------------------------------------------------------
3. DEBTOR'S TRADE NAMES OR STYLES (IF ANY) 3A. FEDERAL TAX NUMBER
================================================================================================
4. SECURED PARTY 4A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. N0.
NAME FLEET CREDIT CORPORATION
MAILING ADDRESS 50 Kennedy Plaza, 5th Floor
CITY Providence STATE RI ZIP CODE 02903
- ------------------------------------------------------------------------------------------------
5. ASSIGNEE OF SECURED PARTY (IF ANY) 5A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. N0.
NAME
MAILING ADDRESS
CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------
6. This FINANCING STATEMENT covers the following types or items of property (include description
of real property on which located and owner of record when required by instruction 4).
(1) General Vacuum Equipment Corp. electron beam metalyzing system as further described on
attached Schedule A(s), and all additions, accessions, modifications, improvements, replacements
substitutions, and accessories thereto and therefor, whether now owned or hereafter acquired,
and proceeds, products and income of any of the foregoing, including insurance proceeds. Debtor
has possession of the equipment under a true lease only. Secured Party has a security interest
in the equipment to the extent necessary to protect its title and interest therein.
Acct. No. 32089-02/lae
- ------------------------------------------------------------------------------------------------
7. CHECK [X] 7A. [ ] PRODUCTS OF COLLATERAL 7B. DEBTOR(S) SIGNATURE NOT REQUIRED IN
IF APPLICABLE ARE ALSO COVERED ACCORDANCE WITH INSTRUCTION 5(a) ITEM:
[ ](1) [ ](2) [ ](3) [ ](4)
- ------------------------------------------------------------------------------------------------
8. CHECK [X] [ ] DEBTOR IS A "TRANSMITTING UTILITY"
IF APPLICABLE IN ACCORDANCE WITH UCC SS. 9105 (1)(n)
- ------------------------------------------------------------------------------------------------
9. DATE: C 10. THIS SPACE FOR USE OF FILING OFFICER
O (DATE. TIME FILE NUMBER
/s/ Michael B. Sullivan 7/11/96 D AND FILING OFFICER)
SIGNATURE(S) OF DEBTOR(S) E
- -------------------------------------------------- ---
Flex Products, Inc. 1
TYPE OR PRINT NAME(S) OF DEBTOR(S) 2
- --------------------------------------------------
3 9620060637
/s/ Sandra Burnett
SIGNATURE(S) OF SECURED PARTY (IES) 4
- --------------------------------------------------
FLEET CAPITAL C0RPORATION 5
TYPE OR PRINT NAME(S) OF SECURED PARTY (IES) 6
==================================================
11. Return copy to: 7 FILED
SACRAMENTO, CA
NAME PARASEARCH INC. 8 JUL 16, 1996 AT 0800
ADDRESS 222 Jefferson Blvd.
CITY Warwick, RI 02688 9 BILL JONES
STATE SECRETARY OF STATE
ZIP CODE 0
==================================================
Filing Officer is requested to note file number,
date and hour of filing on this copy and return to
the above party
FORM UCC.1--
Approved by the Secretary of State
==================================================
</TABLE>
<PAGE>
FLEET CAPITAL CORPORATION PAGE 1 OF 1
SCHEDULE A EQUIPMENT
Attached to and made part of the following documents: True Lease Schedule No.
32089-02, Acceptance Certificate, UCC Financing Statement(s), and Warranty Bill
of Sale with Flex Products, Inc.
The Depreciable Life of the Property is (07) seven years.
LOC# (01)
BETA FIVE
Unit Number: Beta V
(1) General Vacuum Equipment Corp. electron beam metalyzing system, Mfg. 1995,
78" width capacity, 1200 feet per minute, 480 volt, 3 phase, 218 amps, model
95-005, overall size 9' X 10'. serial number 95005 which machine includes, but
is not limited to, the following:
(8) Electron beam guns
(8) Airco Temescal Simba 2 electron beam power supplies, serial numbers 330,
337, 340, 338, 339, 336, 333 and 335
(8) Programmable seep generators
(8) High voltage controllers
(8) Electron beam gun controllers
(2) Polyolds, model PEC1100HC
(6) Varian 20" diffusion pumps, model 016513/HS-20
(8) Airco electron beam gun interfaces
(4) Trige-Scott drive motors, model S90L01199100203050300011, serial numbers
104529421295, 104529211295, 104529311295 and 104529411295
AND ALL STANDARD AND ACCESSORY EQUIPMENT.
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
FLEET CAPITAL CORPORATION Schedule A-1
Equipment Location
Attached to and made part of the following documents True Lease Schedule No.
32089-02, Acceptance Certificate, UCC Financing Statement(s), Warranty Bill of
Sale with Flex Products, Inc.
- --------------------------------------------------------------------------------
Loc # Equipment Currently Located at:
- --------------------------------------------------------------------------------
01 1402 Mariner Way, Santa Rosa, California 95407
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
[LOGO] Fleet STIPULATED LOSS VALUE SCHEDULE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Stipulated Loss Value Schedule (this "Schedule") is attached to
and made a part of that certain Lease Schedule No. 32089-00002, dated as of June
19,1996 (the "Lease Schedule"), by and between the undersigned parties.
<TABLE>
The following Stipulated Loss Values shall be used to calculate damages
or loss as provided in the Master Lease. The Stipulated Loss Value with respect
to any item of Equipment on any Rental Payment Date during the Lease Term shall
be an amount equal to the sum of: (a) all Rental Payments and other amounts then
due and owing to Lessor under the Lease, together with all accrued interest and
late charges thereon, calculated through and including the date of payment: plus
(b) the product of the Acquisition Cost of the such Equipment multiplied by the
percentage set forth below as of such Rental Payment Date.
<CAPTION>
<S> <C> <C> <C>
Rental Payment Date for Percentage of Rental Payment Date for Percentage of
Rental Payment Number Acquisition Cost Rental Payment Number Acquisition Cost
</TABLE>
SEE EXHIBIT C ATTACHED HERETO AND MADE A PART HEREOF
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
EXHIBIT C
TO
STIPULATED LOSS VALUE SCHEDULE
TO LEASE SCHEDULE NO. 32089-02
RENTAL PAYMENT PERCENTAGE OF RENTAL PAYMENT PERCENTAGE OF
DATE FOR RENTAL ACQUISITION COST DATE FOR RENTAL ACQUISITION COST
PAYMENT NUMBER PAYMENT NUMBER
1 103.35121715 37 70.90880090
2 102.77715752 38 69.75511355
3 102.19526265 39 68.59002020
4 101.59552206 40 67.41874422
5 100.98781724 41 66.23597391
6 100.37210821 42 65.04165152
7 99.73838360 43 63.84099969
8 99.09652408 44 62.62870597
9 98.44648879 45 61.40471189
10 97.78823666 46 60.16895869
11 97.11575495 47 58.92972240
12 96.43494366 48 57.67865042
13 95.54711438 49 56.42401842
14 94.34921445 50 55.15747340
15 93.74119331 51 53.87895553
16 92.81702863 52 52.59673978
17 91.88261080 53 51.30247247
18 90.93788832 54 49.99609306
19 89.97683797 55 48.68587582
20 89.00534921 56 47.36346638
21 88.02336959 57 46.02880349
22 87.03084644 58 44.68182560
23 86.02873119 59 43.33120369
24 85.01597126 60 41.96818663
25 83.99351758 61 40.60144498
26 82.96031708 62 39.22222721
27 81.91631576 63 37.83047065
28 80.86246378 64 36.43484516
29 79.79770726 65 35.02659847
30 78.72199142 66 33.60566720
31 77.63626563 67 32.18072044
32 76.53947521 68 30.74300521
33 75.43156457 69 29.29245738
34 74.31247787 70 27.82901249
35 73.18743961 71 26.37095856
36 72.05113926 72 24.89996987
72 25.00000000
<PAGE>
[LOGO] Fleet PURCHASE OPTION RIDER
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (this "Rider") is attached to and made a
part of that certain Lease Schedule No. 32089-00002, dated as of June 19, 1996
(the "Lease Schedule"), by and between the undersigned parties.
If no Event of Default (or event or condition which, with the passage
of time or giving of notice, or both, would become such an Event of Default)
shall have occurred and be continuing, and the Lease shall not have been earlier
terminated, Lessee shall have the option to purchase (the "Purchase Option")
all, but not less than all, of the Equipment at the expiration of the Lease Term
for an amount, payable in immediately available funds on the last day of the
Lease Term, equal to: (a) all Rental Payments, late charges and other amounts
due and owing under the Lease; plus (b) all taxes, assessments and other charges
due or payable in connection with the sale of the Equipment to Lessee; plus (c)
an amount equal to 25.00000% of the Acquisition Cost of the Equipment, which
Lessor and Lessee acknowledge represents a reasonable current estimate of the
fair market value of the Equipment at the end of the Lease Term.
Provided that Lessor shall have received all amounts payable hereunder
on the last day of the Lease Term, and that no Event of Default then exists and
is continuing under the Lease, Lessor shall convey all of its right, title and
interest in and to the Equipment to Lessee on the last day of the Lease Term, on
an "AS-IS," "WHERE-IS" BASIS WITHOUT REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, and without recourse to Lessor, except that the Equipment shall be free
and clear of all liens created by Lessor. If Lessee intends to exercise the
Purchase Option, Lessee shall give irrevocable written notice to Lessor (the
"Option Notice") not more than 240 days, nor less than 180 days, prior to the
expiration of the Lease Term. If Lessee fails to give such written notice to
Lessor, it shall be conclusively presumed that Lessee has elected not to
exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 5.0% of the Acquisition Cost of the
Equipment.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: June 19 , 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
WARRANTY BILL OF SALE
[LOGO] F1eet
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903
FLEX PRODUCTS, INC. ("Seller") of 1402 MARINER WAY SANTA ROSA, CA
95407, in consideration of the sum of $4,500,000.00 Dollars, and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, does hereby sell, transfer and assign to Fleet Capital Corporation
("FCC"), a Rhode Island corporation having its principal office at 50 Kennedy
Plaza, Providence, Rhode Island 02903, the equipment set forth in Schedule A
hereto (the "Equipment").
Seller hereby covenants with and warrants to FCC that Seller is the
lawful owner of the Equipment and has the right to sell the Equipment, and that
the Equipment is free and clear of all rights, claims, liens, charges, security
interests or encumbrances of any other person. Seller will for ever indemnify,
defend and warrant all of the rights of FCC in and to the Equipment transferred
hereunder against the claims and demands of all other persons.
IN WITNESS WHEREOF, Seller has duly executed this Bill of Sale this 11th day of
July, 1996.
FLEX PRODUCTS, INC.
By: /s/ Michael B. Sullivan
--------------------------------
Name: Michael B. Sullivan
------------------------------
Title: President
-----------------------------
State of California
--------------------------
County of Sonoma
--------------------------
Subscribed and sworn before me this 11th day of July, 1996.
/s/ Aggie S. Navarro
Notary Public
My Commission expires:________________
===============================
AGIE S. NAVARRO
[SEAL] COMM. #1009257
Notary Public--California
SONOMA COUNTY
My Comm. Expires NOV 11, 1997
===============================
<PAGE>
FLEET CREDIT CORPORATION
CONSENT AND WAIVER
(OWNER, LANDLORD OR MORTGAGEE OF REAL ESTATE)
50 Kennedy Plaza
Providence, Rhode island 02903
The undersigned, 0ptical Coating Laboratory, Inc., 2789 North Point Parkway
Santa Rosa, California 95407 is the owner, landlord or mortgagee of the premises
located at 1402 Mariner Way, Santa Rosa, California 95407 (the "Premises") which
are occupied by Flex Products, Inc.
The undersigned acknowledges that Customer has leased or financed, or that
Customer expects to lease or finance from Fleet Credit Corporation ("FCC"), the
Equipment set forth on Schedule A hereto including any accessories, additions,
substitutions or replacements therefor, which may from time to time be located
at the Premises. To induce FCC to enter into a lease or financing agreement with
Customer, the undersigned agrees with FCC as follows:
The undersigned waives any right, title or interest in or to the
Equipment that it may now or hereafter have. The undersigned
irrevocably agrees and consents that it will refrain from taking any
action to bar, restrain or otherwise prevent FCC, its agents,
successors or assigns, from entering the Premises for the purpose of
inspecting, removing or taking possession of the Equipment, and will
grant FCC, its agents, successors or assigns the right of entry to the
Premises to remove the Equipment at any reasonable time or times. FCC
shall be responsible for any damage to the Premises that FCC causes in
connection with its entry thereon and the removal of the Equipment
therefrom. The Equipment is and shall remain personal property,
notwithstanding the manner in which it may be installed or affixed to
the Premises.
This Consent and Waiver shall inure to the benefit of the successors and
assigns of FCC and shall be binding upon the heirs, representatives, successors
and assigns of the undersigned. The undersigned will, upon the request and at
the expense of FCC, execute and deliver to FCC such further and additional
documents as FCC may reasonably deem necessary or desirable to effect waivers
and consents contemplated hereby. This Agreement shall be governed by and
construed in accordance with the laws of the state in which the premises are
located, without reference to principles of conflict of laws.
IN WITNESS WHEREOF, the undersigned has duly executed this Consent and
Waiver this 11th day of July, 1996.
Optical Coating Laboratory, Inc.
/s/ Silvia C. Hogan By: /s/ John M. Markovich
- ------------------------- ------------------------------
(Witness) Title: V.P. Finance & CFO
---------------------------
<PAGE>
ACKNOWLEDGEMENT TO BE MADE BY OWNER,
LANDLORD OR MORTGAGEE OF REAL ESTATE
(Hereinafter referred to as "Undersigned")
[INDIVIDUAL)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this ___________ day of ____________________, 19__ personally appeared before me
___________________________, Undersigned in the foregoing Consent and Waiver, to
me personally well known and known to the person who signed said Consent and
Waiver, who, being by me duly sworn and being informed of the contents of said
Consent and Waiver stated and acknowledged on oath that he signed, executed,
sealed and delivered same as his free and voluntary act and deed, for the uses,
purposes and considerations therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(PARTNERSHIP)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this day ___________ of ____________________, 19__ personally appeared before me
___________________________ and ___________________________, who executed the
foregoing Consent and Waiver, to me personally well known and known to the
persons who signed said Consent and Waiver, and known to be and who, being by me
duly sworn and being informed of the contents of said Consent and Waiver, stated
and acknowledged on oath that they were Partners of ____________________________
__________________, the Partnership named in and which executed the said Consent
and Waiver, and that they signed, executed, sealed and delivered same
individually and in behalf of the said Partnership, with authority as their and
its free and voluntary act and deed for the uses, purposes and considerations
therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(CORPORATION)
===================================
STATE OF California SILVIA C. HOGAN
----------------- [SEAL] COMM. #1009258
SS. Notary Public - California
COUNTY OF Sonoma SONOMA COUNTY
----------------- My Comm. Expires NOV 11, 1997
===================================
I, Silvia C. Hogan, a Notary Public within and for said County, in
the State aforesaid, duly commissioned and acting, do hereby certify that on
this 11th day of July, 1996 personally appeared before me John M. Markovich
(Name of Signer for Undersigned) to me personally well known and known to me to
be the person who signed the foregoing Consent and Waiver, and known to me to be
and who, being by me duly sworn and being informed of the contents of said
Consent and Waiver, stated and acknowledged to me an oath that he was Vice
President & CFO (Title) of Optical Coating Laboratory, Inc., the Corporation
named in and which executed said Consent and Waiver, and that he knows the
corporate seal of said Corporation, and that the seal affixed to said Consent
and Waiver is the corporate seal of said Corporation, that he was duly
authorized to execute said Consent and Waiver, for, in the name of and on behalf
of said Corporation, and that same was signed, sealed, executed and delivered by
him in the name of and on behalf of said Corporation by authority of its Board
of Directors and that the execution of said Consent and Waiver was his free and
voluntary act and deed in his said capacity and acknowledged to me that said
Corporation executed the same as its voluntary act and deed and was by him
voluntarily executed, on behalf of said Corporation for the uses, purposes and
considerations therein mentioned and set
forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires November 11, 1997 /s/ Silvia C. Hogan
----------------- --------------------
(Notary Public)
(Seal)
<PAGE>
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
================================================================================
State of California
--------------------------
County of Sonoma
-------------------------
On July 11, 1996 before me, Silvia C. Hogan, Notary Public
------------- ------------------------------------------------------
Date NAME, TITLE OF OFFICER-E.G., "JANE DOE, NOTARY PUBLIC"
personally appeared John M. Markovich
------------------------------------------------------------
NAME(S) OF SIGNER(S)
[X] personally known to me - OR - [ ] proved to me on the basis of satisfactory
evidence to be the person whose name is
================================== subscribed to the within instrument and
SILVIA C. HOGAN acknowledged to me that he executed the
[SEAL] COMM. #1009258 same in his authorized capacity and that by
Notary Public - California his signature on the instrument the person,
SONOMA COUNTY or the entity upon behalf of which the
My Comm. Expires NOV 11, 1997 person acted, executed the instrument.
==================================
WITNESS my hand and official seal.
/s/ Silvia C. Hogan
-------------------------------------------
SIGNATURE OF NOTARY
====================================OPTIONAL====================================
Though the data below is not required by law, it may prove valuable to persons
relying on the document and could prevent fraudulent reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT
[ ] INDIVIDUAL
[X] CORPORATE OFFICER
Vice President & CFO Consent and Waiver
---------------------------------- --------------------------------
TITLE(S) TITLE OR TYPE OF DOCUMENT
[ ] PARTNER(S) [ ] LIMITED 2
[ ] GENERAL --------------------------------
[ ] ATTORNEY-IN-FACT NUMBER OF PAGES
[ ] TRUSTEE(S)
[ ] GUARDIAN/CONSERVATOR 7-11-96
[ ] OTHER:____________________________ --------------------------------
__________________________________ DATE OF DOCUMENT
__________________________________
SIGNER IS REPRESENTING:
NAME OF PERSON(S) OR ENTITY(IES)
Optical Coating Laboratory, Inc. ----
- -------------------------------------- --------------------------------
SIGNER(S) OTHER THAN NAMED ABOVE
- --------------------------------------
================================================================================
<PAGE>
FLEET CREDIT CORPORATION
CONSENT AND WAIVER
(OWNER, LANDLORD OR MORTGAGEE OF REAL ESTATE)
50 Kennedy Plaza
Providence, Rhode island 02903
The undersigned, 0ptical Coating Laboratory, Inc., 2789 North Point Parkway
Santa Rosa, California 95407 is the owner, landlord or mortgagee of the premises
located at 1402 Mariner Way, Santa Rosa, California 95407 (the "Premises") which
are occupied by Flex Products, Inc.
The undersigned acknowledges that Customer has leased or financed, or that
Customer expects to lease or finance from Fleet Credit Corporation ("FCC"), the
Equipment set forth on Schedule A hereto including any accessories, additions,
substitutions or replacements therefor, which may from time to time be located
at the Premises. To induce FCC to enter into a lease or financing agreement with
Customer, the undersigned agrees with FCC as follows:
The undersigned waives any right, title or interest in or to the
Equipment that it may now or hereafter have. The undersigned
irrevocably agrees and consents that it will refrain from taking any
action to bar, restrain or otherwise prevent FCC, its agents,
successors or assigns, from entering the Premises for the purpose of
inspecting, removing or taking possession of the Equipment, and will
grant FCC, its agents, successors or assigns the right of entry to the
Premises to remove the Equipment at any reasonable time or times. FCC
shall be responsible for any damage to the Premises that FCC causes in
connection with its entry thereon and the removal of the Equipment
therefrom. The Equipment is and shall remain personal property,
notwithstanding the manner in which it may be installed or affixed to
the Premises.
This Consent and Waiver shall inure to the benefit of the successors and
assigns of FCC and shall be binding upon the heirs, representatives, successors
and assigns of the undersigned. The undersigned will, upon the request and at
the expense of FCC, execute and deliver to FCC such further and additional
documents as FCC may reasonably deem necessary or desirable to effect waivers
and consents contemplated hereby. This Agreement shall be governed by and
construed in accordance with the laws of the state in which the premises are
located, without reference to principles of conflict of laws.
IN WITNESS WHEREOF, the undersigned has duly executed this Consent and
Waiver this 11th day of July, 1996.
Optical Coating Laboratory, Inc.
/s/ Silvia C. Hogan By: /s/ John M. Markovich
- ------------------------- ------------------------------
(Witness) Title: V.P. Finance & CFO
---------------------------
<PAGE>
ACKNOWLEDGEMENT TO BE MADE BY OWNER,
LANDLORD OR MORTGAGEE OF REAL ESTATE
(Hereinafter referred to as "Undersigned")
[INDIVIDUAL)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this ___________ day of ____________________, 19__ personally appeared before me
___________________________, Undersigned in the foregoing Consent and Waiver, to
me personally well known and known to the person who signed said Consent and
Waiver, who, being by me duly sworn and being informed of the contents of said
Consent and Waiver stated and acknowledged on oath that he signed, executed,
sealed and delivered same as his free and voluntary act and deed, for the uses,
purposes and considerations therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(PARTNERSHIP)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this day ___________ of ____________________, 19__ personally appeared before me
___________________________ and ___________________________, who executed the
foregoing Consent and Waiver, to me personally well known and known to the
persons who signed said Consent and Waiver, and known to be and who, being by me
duly sworn and being informed of the contents of said Consent and Waiver, stated
and acknowledged on oath that they were Partners of ____________________________
__________________, the Partnership named in and which executed the said Consent
and Waiver, and that they signed, executed, sealed and delivered same
individually and in behalf of the said Partnership, with authority as their and
its free and voluntary act and deed for the uses, purposes and considerations
therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(CORPORATION)
===================================
STATE OF California SILVIA C. HOGAN
----------------- [SEAL] COMM. #1009258
SS. Notary Public - California
COUNTY OF Sonoma SONOMA COUNTY
----------------- My Comm. Expires NOV 11, 1997
===================================
I, Silvia C. Hogan, a Notary Public within and for said County, in
the State aforesaid, duly commissioned and acting, do hereby certify that on
this 11th day of July, 1996 personally appeared before me John M. Markovich
(Name of Signer for Undersigned) to me personally well known and known to me to
be the person who signed the foregoing Consent and Waiver, and known to me to be
and who, being by me duly sworn and being informed of the contents of said
Consent and Waiver, stated and acknowledged to me an oath that he was Vice
President & CFO (Title) of Optical Coating Laboratory, Inc., the Corporation
named in and which executed said Consent and Waiver, and that he knows the
corporate seal of said Corporation, and that the seal affixed to said Consent
and Waiver is the corporate seal of said Corporation, that he was duly
authorized to execute said Consent and Waiver, for, in the name of and on behalf
of said Corporation, and that same was signed, sealed, executed and delivered by
him in the name of and on behalf of said Corporation by authority of its Board
of Directors and that the execution of said Consent and Waiver was his free and
voluntary act and deed in his said capacity and acknowledged to me that said
Corporation executed the same as its voluntary act and deed and was by him
voluntarily executed, on behalf of said Corporation for the uses, purposes and
considerations therein mentioned and set
forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires November 11, 1997 /s/ Silvia C. Hogan
----------------- --------------------
(Notary Public)
(Seal)
<PAGE>
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
================================================================================
State of California
--------------------------
County of Sonoma
-------------------------
On July 11, 1996 before me, Silvia C. Hogan, Notary Public
------------- ------------------------------------------------------
Date NAME, TITLE OF OFFICER-E.G., "JANE DOE, NOTARY PUBLIC"
personally appeared John M. Markovich
------------------------------------------------------------
NAME(S) OF SIGNER(S)
[X] personally known to me - OR - [ ] proved to me on the basis of satisfactory
evidence to be the person whose name is
================================== subscribed to the within instrument and
SILVIA C. HOGAN acknowledged to me that he executed the
[SEAL] COMM. #1009258 same in his authorized capacity and that by
Notary Public - California his signature on the instrument the person,
SONOMA COUNTY or the entity upon behalf of which the
My Comm. Expires NOV 11, 1997 person acted, executed the instrument.
==================================
WITNESS my hand and official seal.
/s/ Silvia C. Hogan
-------------------------------------------
SIGNATURE OF NOTARY
====================================OPTIONAL====================================
Though the data below is not required by law, it may prove valuable to persons
relying on the document and could prevent fraudulent reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT
[ ] INDIVIDUAL
[X] CORPORATE OFFICER
Vice President & CFO Consent and Waiver
---------------------------------- --------------------------------
TITLE(S) TITLE OR TYPE OF DOCUMENT
[ ] PARTNER(S) [ ] LIMITED 2
[ ] GENERAL --------------------------------
[ ] ATTORNEY-IN-FACT NUMBER OF PAGES
[ ] TRUSTEE(S)
[ ] GUARDIAN/CONSERVATOR 7-11-96
[ ] OTHER:____________________________ --------------------------------
__________________________________ DATE OF DOCUMENT
__________________________________
SIGNER IS REPRESENTING:
NAME OF PERSON(S) OR ENTITY(IES)
Optical Coating Laboratory, Inc. ----
- -------------------------------------- --------------------------------
SIGNER(S) OTHER THAN NAMED ABOVE
- --------------------------------------
================================================================================
<PAGE>
FLEET CREDIT CORPORATION
CONSENT AND WAIVER
(OWNER, LANDLORD OR MORTGAGEE OF REAL ESTATE)
50 Kennedy Plaza
Providence, Rhode island 02903
The undersigned, 0ptical Coating Laboratory, Inc., 2789 North Point Parkway
Santa Rosa, California 95407 is the owner, landlord or mortgagee of the premises
located at 1402 Mariner Way, Santa Rosa, California 95407 (the "Premises") which
are occupied by Flex Products, Inc.
The undersigned acknowledges that Customer has leased or financed, or that
Customer expects to lease or finance from Fleet Credit Corporation ("FCC"), the
Equipment set forth on Schedule A hereto including any accessories, additions,
substitutions or replacements therefor, which may from time to time be located
at the Premises. To induce FCC to enter into a lease or financing agreement with
Customer, the undersigned agrees with FCC as follows:
The undersigned waives any right, title or interest in or to the
Equipment that it may now or hereafter have. The undersigned
irrevocably agrees and consents that it will refrain from taking any
action to bar, restrain or otherwise prevent FCC, its agents,
successors or assigns, from entering the Premises for the purpose of
inspecting, removing or taking possession of the Equipment, and will
grant FCC, its agents, successors or assigns the right of entry to the
Premises to remove the Equipment at any reasonable time or times. FCC
shall be responsible for any damage to the Premises that FCC causes in
connection with its entry thereon and the removal of the Equipment
therefrom. The Equipment is and shall remain personal property,
notwithstanding the manner in which it may be installed or affixed to
the Premises.
This Consent and Waiver shall inure to the benefit of the successors and
assigns of FCC and shall be binding upon the heirs, representatives, successors
and assigns of the undersigned. The undersigned will, upon the request and at
the expense of FCC, execute and deliver to FCC such further and additional
documents as FCC may reasonably deem necessary or desirable to effect waivers
and consents contemplated hereby. This Agreement shall be governed by and
construed in accordance with the laws of the state in which the premises are
located, without reference to principles of conflict of laws.
IN WITNESS WHEREOF, the undersigned has duly executed this Consent and
Waiver this 11th day of July, 1996.
Optical Coating Laboratory, Inc.
/s/ Silvia C. Hogan By: /s/ John M. Markovich
- ------------------------- ------------------------------
(Witness) Title: V.P. Finance & CFO
---------------------------
<PAGE>
ACKNOWLEDGEMENT TO BE MADE BY OWNER,
LANDLORD OR MORTGAGEE OF REAL ESTATE
(Hereinafter referred to as "Undersigned")
[INDIVIDUAL)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this ___________ day of ____________________, 19__ personally appeared before me
___________________________, Undersigned in the foregoing Consent and Waiver, to
me personally well known and known to the person who signed said Consent and
Waiver, who, being by me duly sworn and being informed of the contents of said
Consent and Waiver stated and acknowledged on oath that he signed, executed,
sealed and delivered same as his free and voluntary act and deed, for the uses,
purposes and considerations therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(PARTNERSHIP)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this day ___________ of ____________________, 19__ personally appeared before me
___________________________ and ___________________________, who executed the
foregoing Consent and Waiver, to me personally well known and known to the
persons who signed said Consent and Waiver, and known to be and who, being by me
duly sworn and being informed of the contents of said Consent and Waiver, stated
and acknowledged on oath that they were Partners of ____________________________
__________________, the Partnership named in and which executed the said Consent
and Waiver, and that they signed, executed, sealed and delivered same
individually and in behalf of the said Partnership, with authority as their and
its free and voluntary act and deed for the uses, purposes and considerations
therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(CORPORATION)
===================================
STATE OF California SILVIA C. HOGAN
----------------- [SEAL] COMM. #1009258
SS. Notary Public - California
COUNTY OF Sonoma SONOMA COUNTY
----------------- My Comm. Expires NOV 11, 1997
===================================
I, Silvia C. Hogan, a Notary Public within and for said County, in
the State aforesaid, duly commissioned and acting, do hereby certify that on
this 11th day of July, 1996 personally appeared before me John M. Markovich
(Name of Signer for Undersigned) to me personally well known and known to me to
be the person who signed the foregoing Consent and Waiver, and known to me to be
and who, being by me duly sworn and being informed of the contents of said
Consent and Waiver, stated and acknowledged to me an oath that he was Vice
President & CFO (Title) of Optical Coating Laboratory, Inc., the Corporation
named in and which executed said Consent and Waiver, and that he knows the
corporate seal of said Corporation, and that the seal affixed to said Consent
and Waiver is the corporate seal of said Corporation, that he was duly
authorized to execute said Consent and Waiver, for, in the name of and on behalf
of said Corporation, and that same was signed, sealed, executed and delivered by
him in the name of and on behalf of said Corporation by authority of its Board
of Directors and that the execution of said Consent and Waiver was his free and
voluntary act and deed in his said capacity and acknowledged to me that said
Corporation executed the same as its voluntary act and deed and was by him
voluntarily executed, on behalf of said Corporation for the uses, purposes and
considerations therein mentioned and set
forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires November 11, 1997 /s/ Silvia C. Hogan
----------------- --------------------
(Notary Public)
(Seal)
<PAGE>
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
================================================================================
State of California
--------------------------
County of Sonoma
-------------------------
On July 11, 1996 before me, Silvia C. Hogan, Notary Public
------------- ------------------------------------------------------
Date NAME, TITLE OF OFFICER-E.G., "JANE DOE, NOTARY PUBLIC"
personally appeared John M. Markovich
------------------------------------------------------------
NAME(S) OF SIGNER(S)
[X] personally known to me - OR - [ ] proved to me on the basis of satisfactory
evidence to be the person whose name is
================================== subscribed to the within instrument and
SILVIA C. HOGAN acknowledged to me that he executed the
[SEAL] COMM. #1009258 same in his authorized capacity and that by
Notary Public - California his signature on the instrument the person,
SONOMA COUNTY or the entity upon behalf of which the
My Comm. Expires NOV 11, 1997 person acted, executed the instrument.
==================================
WITNESS my hand and official seal.
/s/ Silvia C. Hogan
-------------------------------------------
SIGNATURE OF NOTARY
====================================OPTIONAL====================================
Though the data below is not required by law, it may prove valuable to persons
relying on the document and could prevent fraudulent reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT
[ ] INDIVIDUAL
[X] CORPORATE OFFICER
Vice President & CFO Consent and Waiver
---------------------------------- --------------------------------
TITLE(S) TITLE OR TYPE OF DOCUMENT
[ ] PARTNER(S) [ ] LIMITED 2
[ ] GENERAL --------------------------------
[ ] ATTORNEY-IN-FACT NUMBER OF PAGES
[ ] TRUSTEE(S)
[ ] GUARDIAN/CONSERVATOR 7-11-96
[ ] OTHER:____________________________ --------------------------------
__________________________________ DATE OF DOCUMENT
__________________________________
SIGNER IS REPRESENTING:
NAME OF PERSON(S) OR ENTITY(IES)
Optical Coating Laboratory, Inc. ----
- -------------------------------------- --------------------------------
SIGNER(S) OTHER THAN NAMED ABOVE
- --------------------------------------
================================================================================
<PAGE>
30 BROAD STREET
[LOGO] HUGH WOOD INC. NEW YORK, NEW YORK 10004-2333
TELEPHONE: (212) 509-3777
FAX: (212) 509-4906
Mr. Jeffrey M. Ryan 12th July 1996
Assistant Treasurer
Optical Coating Laboratory, Inc.
2789 Northpoint Parkway
Santa Rosa, CA 95407-7397
Fleet Capital Leasing
Dear Jeff:
The original copy of the certificate and attachments with respect to the
captioned is enclosed for your records and handling.
I will hopefully be able to forward the insurance schedule early next week.
Sincerely,
/s/ Jack R. Fisher
Jack R. Fisher, CPCU
Vice President
JRF:jl enclosure
letter\fisher\RYAN
<PAGE>
<TABLE>
<CAPTION>
[LOGO] CERTIFICATE OF INSURANCE CSR DM ISSUE DATE (MM/DD/YY)
FLE0001 07/11/96
PRODUCER ==================================================================================
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS
Hugh Wood Inc. NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND,
30 Broad Street EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW.
New York NY 10004 =================================================================================
COMPANIES AFFORDING COVERAGE
212-509-3777
COMPANY
LETTER A Royal Insurance Company
COMPANY B See Reverse
LETTER
INSURED
COMPANY C
LETTER
COMPANY
Flex Products, Inc. LETTER D
1402 Mariner Way
Santa Rosa CA 95407 COMPANY
LETTER E
- ----------------------------------------------------------------------------------------------------------------------------
COVERAGES
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY
PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO
WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO
ALL THE TERMS. EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
CO TYPE OF POLICY POLICY EFFECTIVE POLICY EXPIRATION
LTR INSURANCE NUMBER DATE(MM/DD/YY) DATE(MM/DD/YY) LIMITS
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
GENERAL LIABILITY GENERAL AGGREGATE $ 2,000,000
A X COMMERCIAL GENERAL LIABILITY RIW 762691 03/31/96 03/31/97
PRODUCTS-COMP/OP AGG. $ 1,000,000
CLAIMS MADE X OCCUR. PERSONAL & ADV. INJURY $ 1,000,000
OWNER'S & CONTRACTOR'S PROT. EACH OCCURRENCE $ 1,000,000
FIRE DAMAGE (Any one fire) $ 1,0O0,000
MED. EXPENSE (Any one person) $ 5,000
- ----------------------------------------------------------------------------------------------------------------------------
AUTOMOBILE LIABILITY
ANY AUTO COMBINED SINGLE
LIMIT $
ALL OWNED AUTOS
BODILY INJURY
SCHEDULED AUTOS (Per person) $
HIRED AUTOS BODILY INJURY
(Per accident) $
NON-OWNED AUTOS
GARAGE LIABILITY PROPERTY DAMAGE $
- ----------------------------------------------------------------------------------------------------------------------------
EXCESS LIABILITY EACH OCCURRENCE $
UMBRELLA FORM AGGREGATE $
OTHER THAN UMBRELLA FORM
- ----------------------------------------------------------------------------------------------------------------------------
WORKER'S COMPENSATION STATUTORY LIMITS
AND EACH ACCIDENT $
EMPLOYERS' LIABILITY DISEASE--POLICY LIMIT $
DISEASE--EACH EMPLOYEE $
- ----------------------------------------------------------------------------------------------------------------------------
OTHER
A Blanket Property RIL762701 03/31/96 03/31/97 All Risk $40,138,000
B Earthquake See Reverse
- ----------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
The Certificate Holder is included as Loss Payee with respect to equipment known
as Beta I, Beta II, Beta III, and Beta V, as listed on the attached schedules.
Property deductible - $10,000, each and every loss, except Earthquake where the
deductible is 5% of the total location value.
- ----------------------------------------------------------------------------------------------------------------------------
CERTIFICATE HOLDER CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
EXPIRATION DATE THEREOF. THE ISSUING COMPANY WILLENDEAVOR TO
Fleet Capital Leasing MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
50 Kennedy Plaza LEFT. BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR
Providence Rl 02903 LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
-------------------------------------------------------------------------------
AUTHORIZED REPRESENTATIVE
/s/ Jack Fish
ACORD 25-S (7/90) ACORD CORPORATION 1990
</TABLE>
<PAGE>
EARTHQUAKE
POLICY POLICY
COMPANY NUMBER PERIOD LIMITS
Royal RIL762701 3-31-96/3-31-97 $3,000,000
Insurance
Company
Agriculture CPP1802300 3-31-96/3-31-97 $2,500,000 Excess of
Insurance $3,000,000
Associated IM316256 3-31-96/3-31-97 $3,333,333 Part of
International $5,000,000 Excess of
$5,500,000
Frontier FIM316256 3-31-96/3-31-97 $1,666,667 Part of
Pacific $5,000,000 Excess of
$5,500,000
<PAGE>
FLEET CAPITAL CORPORATION PAGE 1 OF 1
SCHEDULE A EQUIPMENT
Attached to and made part of the following document: Insurance Certification
with Flex Products, Inc. (32089-01)
The Depreciable Life of the Property is (07) seven years.
LOC# (01)
BETA THREE
(1) Weinert Vacuum GMBH, sputtering roll coating machine, Mfg. 1995, 7' X 10'
chamber size, 480 volt, 3 phase, all stainless stee1 construction Serial Number
_________
Unit Number: Beta III is included
but not limited to, the following:
(6) 20" diffusion pumps
(4) 16" diffusion pumps
3 Chamber system
Liebert UPS battery back-up system, model AP441, serial number P21174SE
(3) Polycoid cooling systems, model PFC-1100ST
(3) Cathodes
(2) Aluminum evaporation systems
(6) Transformers, 72 kilowatt
Edwards two stage vacuum pump, model 275
(3) Edwards two stage vacuumm pumps, model 8O
(3) ENI D.C. Plasma generators, model DCG-100 zokw/ea
Siemens PLC
(1) Nemonic Display
(2) Control Stations
(1) PLC
(2) Machine state actuators
Circulation pumps
Hydraulic pumps
Miscellaneous spare parts
AND ALL STANDARD AND ACCESSORY EQUIPMENT
FLEET CAPITAL CORPORATION Jack Fisher Insurance Co.
----------------------
BY: BY:
-------------------------------- --------------------------------
NAME: NAME:
------------------------------ ------------------------------
TITLE: TITLE:
----------------------------- -----------------------------
<PAGE>
FLEET CAPITAL CORPORATION PAGE 1 OF 1
SCHEDULE A EQUIPMENT
Attached to and made part of the following documents: Insurance Certification
with Flex Products, Inc. (32089-02)
The Depreciable Life of the Property is (07) seven years.
LOC# (01)
BETA FIVE
(1) Greneral Vacuum Equipment Corp. electron beam metalyzing system, Mfg. 1995,
78" width capacity, 1200 feet per minute, 480 volt, 3 phase, 218 amps, model
95-005, overall size 9' X 10', serial number W9827-95
Unit Number: Beta V
Including, but not limited to, the following:
(8) Electron beam
(8) Airco Temescal Simba 2 electron beam power supplies, serial numbers 330,
337, 340, 338, 339, 336, 333 and 335
(8) Programmable seep generators
(8) High voltage controllers
(8) Electron beam gun controllers
(2) Polycolds, model PEC1100HC
(6) Varian 20" diffusion pumps, model 016513/HS-20
(8) Airco electron beam gun interfaces
(4) Trige-Scott drive motors, model S90L01199100203050300011, serial numbers
104529421295, 104529211295, 104529311295 and 104529411295
AND ALL STANDARD AND ACCESSORY EQUIPMENT.
FLEET CAPITAL CORPORATION Jack Fisher Insurance Co.
----------------------
BY: BY:
-------------------------------- --------------------------------
NAME: NAME:
------------------------------ ------------------------------
TITLE: TITLE:
----------------------------- -----------------------------
<PAGE>
FLEET CAPITAL CORPORATION PAGE 1 OF 3
ADDITIONAL COLLATERAL SCHEDULE
Attached to and made part of the following documents: Additional Security
Agreement dated as of: June 19, 1996 and UCC Financing Statement(s) with Flex
Products, Inc.
The Equipment is currently located at: 2793 Northpoint Parkway
Santa Rosa, California 95407
BETA ONE
(1) Leybold Hereaus electron beam roll coater, model Al600B30, Mfg. 1979, 52"
width capacity, 3 meters per second, 480 volt, 3 phase, 122 Amps., Serial Number
_________________.
Unit Number: Beta I
Including, but not limited to, the following:
(12) 30KW electron beam guns with power supplies, model D2D4
(3) Polycolds, model PFC1PFC00ST
(6) Diffusion pumps, 20" Water cooled
(12) Electron gun controllers
Winding Cabinet
(12) Hewlett Packard 6253A dual DC power supplies, 0-200 volt, 3 amps
(5) Leybold Hereaus vacuum motors, model PENNINGVAC PM 41152
(4) Leybold Hereaus vacuum motors, model THERMOVPC TM 22052
Viewing port holes
Residual gas analyzers electron monitoring system, model QUADREX 200
Meters
Control Cabinets
Catwalk and platform around machine
Hi-resolution RAD monitoring system
Winding shafts and chucks
Sputtering power supply
63 X 15 Target
Web drives
Plate lifter
(6) Leybold Hereaus turbo pumps, model 1000C
(4) Stokes vacuum pumps, model 412-11
(2) Leybold Hereaus blowers, model RA7001S
(4) Genvin portable oil filters
Glow power supply
(6) Filter amplifier chassis
(2) Water cooled shield sets
Sputtering targets
Desktop computer
Monitors with exception of proprietary plasma emission and optical monitor
Pressure controllers
Heco-Pacific crane
<PAGE>
PAGE 2 OF 3
ADDITIONAL COLLATERAL SCHEDULE
BETA TWO
(l) Leybold Hereaus sputtering roll coater, Mfg. 1987, 54" width capacity,
overall size approximately 16' X 12' X 12', 480 volt, 3 phase, Serial Number
_______
Unit Number: Beta II
Including, but not limited to, the following:
(2) polycolds, model PFC65011ST
(8) 8 X 54 sputtering targets with (8) SSV sputtering power supplies, serial
numbers are MCC3K1-2, MCC3K3-4, MCC3I1-2, MCC3I3-4, MCC3G1-2, MCC3G3-4,
MCC3F1-2, MCC3F3-4
(2) Cryo-pumps
Neslab chiller, model RTE-110
(8) 90 Kilowatt breaker boxes
(8) Systron Donner 0-60 VDC, 0-100 amp. power supplies
(21) Leybold Hereaus turbo pumps, model 1000G
(2) Leybold Hereaus blower station, model WAV2000
(3) Leybold Hereaus pumps, model S250-C
Leybold Hereaus blower, model RUVAC, type WPV 251
(2) Balston filters, model R1680
Leybold Hereaus blower, model RUVAC, type 70001S
Cooling Tower
(4) Anode power supplies
(4) Glow discharge power supplies
Allen Bradley controls, PLC-30
Herbert Schuller chilling system with tower
(4) Optical monitoring devices
Transformers
Motor controls
Sheet resistance monitor
Safety platform with stairs
(2) Target backing plates
(2) Analog controllers
(2) 50/50 tooling
Turbo lifting fixture
(43) sets of shields
Gas handling system
Cathode system
Overhead trolley with crane
(7) Spare Titanium targets
(5) Zircon targets
(6) Long shields
<PAGE>
PAGE 3 OF 3
ADDITIONAL COLLATERAL SCHEDULE
The Equipment is Currenty Located at: 1402 Mariner Way
Santa Rosa, California 95407
BETA THREE
(2) Bell & Gossett pumps, models 11RC925 series 1510, serial numbers 1955297
and 1955296 Raven polypro tank, approximately 5' X 2' diameter
Raven polypro tank, approximately 5' X 2' diameter
(2) Bell & Gossett pumps, models 4BC9375, serial numbers 1957959 and 1957960,
625 GPM
Alfa laval heat exchanger, type M6-FG, serial number 3010286368 with (4)
0-150 degree gauges
Alfa laval heat exchanger, type MIO-BFG, serial number 3010286389 with (4)
0-150 degree gauges
FSI water filter, model FSP-40N-30455, Mfg. 1995, 10 micron with 0-160 PSI
gauge
Dual water cooling condensing system, low pressure, high pressure with (2)
KSB pumps, model ETACHROMB, valves, so1enoids
(2) Edwards two stage vacuum pumps, model 275
Air storage tank 4' X 2' diameter with 0-160 PSI guage
Water filter system with (2) KSB ETACHROM-B-40160562, pumps, 2200 gallon
round stainless steel tank, model BT33541
Approximately 60' X 4" stainless steel piping with fittings
Approximately 100' X 2" stainless steel piping with fittings
BETA FIVE
WPH overhead wire rope crane, model 1 l/2 ton, serial number W6022015,
approximately X-Y, travel is 55' X 35' X 40'
Kinney vacuum rotary pump, model KT-505-LP, serial number 3011-2 with a
dresser roots booster blower, 15HP, model HV3000, serial number H00224, 480
volts
Kinney vacuum rotary pump, model KT-505-LP, serial number 3011-1 with a
dresser roots booster blower, 15HP, model HV3000, serial number H00219
Dresser roots, 30MP booster pump
(4) Emergency isolation switches
(3) 5.5 Bar pneumatic actuator valves
Solenoids
Alfa laval heat exchanger, Mfg. 1995, serial number 3010286367
(4) Weksler temperature gauges, 0-150 degrees Fahrenheit
Raven round polypro storage tank, approximately 6' X 4' diameter, serial
number G333465
Approximately 60 feet of 4" 304 stainless steel seamless piping with
connectors
(2) ITT Bell & Gossett pumps, series 1510, 20 HP, 200 GPM, model
21/2AB7000BF, serial numbers 1955295 and 1955296
(2) FSI filter columns, stainless steel, Mfg. 1995, 10 micron filters, serial
numbers 38121, 150 PSI
Air storage tank 4' X 2' diameter with a 0-160 PSI gauge
Miscellaneous spare parts
Jack Fisher Insurance Co.
----------------------
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
BY: BY:
-------------------------------- --------------------------------
NAME: NAME:
------------------------------ ------------------------------
TITLE: TITLE:
----------------------------- -----------------------------
<PAGE>
[LOGO] Fleet SECRETARY'S CERTIFICATE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
The undersigned, Joseph C. Zils, the duly elected Secretary of FLEX PRODUCTS,
INC. (the "Corporation"), in order to induce Fleet Capital Corporation ("FCC")
to enter into one or more loans, leases or otherwise extend financial
accommodations to or for the benefit of the Corporation, hereby certifies to FCC
that:
(i) the Corporation is duly organized, validly existing and in good standing
under the laws of the State or Commonwealth of DELAWARE;
(ii) the Corporation has full corporate power and authority to enter into one or
more transactions, at any time and in any amount or form, with FCC: (a) to sell
to and/or lease or purchase from FCC any personal property or fixtures; (b) to
borrow and otherwise effect loans and advances or extensions of credit; (c) to
guaranty or otherwise provide financial accommodations or additional security
for the payment and performance of any obligations or indebtedness owing to FCC
by the Corporation or any other party; and (d) to sell, assign, transfer,
mortgage, pledge, hypothecate, grant security interests in, endorse and deliver
to FCC, any and all real or personal property of the Corporation, tangible or
intangible, of every name and description, as security for the payment and
performance of any obligations or indebtedness owing to FCC by the Corporation
or any other party, or otherwise in connection with any of the foregoing (the
"Authorized Transactions");
(iii) each of the officers designated below (an "Authorized Officer"), is a duly
elected (or appointed), qualified and acting officer of the Corporation, and the
signature appearing opposite his or her name below is his or her genuine
signature:
Name Office Signature
---- ------ ---------
Michael B. Sullivan President
- ------------------------- ------------------------ -------------------------
- ------------------------- ------------------------ -------------------------
- ------------------------- ------------------------ -------------------------
(iv) each Authorized Officer has full power and authority to act alone on behalf
of the Corporation with respect to the Authorized Transactions and to do and
perform all acts and things, and to execute and deliver all instruments and
documents of every kind and nature he or she may deem necessary, proper or
incidental to, or which is otherwise required by FCC in connection with,
completion of the Authorized Transactions, including but not limited to one or
more leases, loan agreements, promissory notes, security agreements, schedules,
riders, certificates, guaranties, pledge agreements, subordination agreements,
purchase orders or agreements, disbursement authorizations, invoices, bills of
sale, intercreditor agreements, consents, disclaimers of interests, legal
opinions and UCC financing statements and any future modification(s) or
amendments thereof ("Authorized Documentation"), with such execution and
delivery to be conclusive evidence that such Authorized Transactions have been
duly and specifically authorized and approved by the Board of Directors of the
Corporation as being for the benefit of the Corporation in consideration of
reasonably equivalent value to the Corporation, and that such Authorized
Documentation is intended by the Board of Directors to constitute the valid and
legally binding obligations of the Corporation, enforceable by FCC in accordance
with their terms;
(v) all corporate votes, meetings, consents or other actions necessary or
appropriate to duly and properly authorize the Corporation to enter into the
Authorized Transactions and for the Authorized Officers to execute and deliver
the Authorized Documentation has been taken, and such corporate actions are in
full force and effect as of the date hereof and have not been modified or
rescinded in any respect;
(vi) all previous acts of, and all documents and papers heretofore executed and
delivered by, any Authorized Officer in connection with the Authorized
Transactions or any Authorized Documentation are ratified, confirmed and
approved as the act or acts of the Corporation; and
(vii) the Corporation shall furnish written notice to FCC of any revocation,
modification or amendment of any corporate action affecting any of the foregoing
certifications, and FCC shall be entitled to rely on these certifications until
such notice is received by FCC.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the
Corporation, this 11th day of July, 1996
/s/ Joseph C. Zils
------------------------------
Secretary
<PAGE>
July 11, 1996
FLEET CAPITAL CORPORATION
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
Re: Master Lease Agreement (the "Master Lease") between Fleet Capital
Corporation ("Fleet") and Flex Products, Inc. ("Lessee") dated June 19,
1996
Gentlemen:
I serve as Vice President, General Counsel and Secretary of Optical
Coating Laboratory, Inc. and as Secretary of Lessee. I have also been authorized
by the Chairman of the Board of Directors of Lessee to oversee and manage the
legal affairs for Lessee. In this capacity, I have acted as counsel for Lessee
in connection with the proposed transaction between Lessee and you as set forth
in the Master Lease and with respect to certain equipment described in the
Master Lease (the "Equipment") along with John V. Erickson of the law firm of
Collette & Erickson.
In connection with the Master Lease I have been furnished with originals
or copies certified to my satisfaction of such corporate or other records of the
Lessee, with such certificates of officers and representatives of the Lessee,
and with such other documents, and I have made such other examinations and
investigations, as I have deemed necessary as a basis for the opinions expressed
below.
All capitalized terms used and not expressly defined below shall have
the meaning given to them in the Master Lease.
In conducting my examination I have assumed, without investigation, the
genuineness of all signatures, the correctness of all certificates, the
authenticity of all certificates and documents submitted to me as originals, the
conformity to original documents of all documents submitted to me as certified
or photostatic copies and the authenticity of the originals of such copies, and
the accuracy and completeness of all records made available to me by the Lessee
or any of its affiliates. I have also assumed, without investigation, the
accuracy of the representations and warranties as to factual matters made by any
party in the Master Lease and all related documents and the accuracy of the
representations and statements made to me by officers, affiliates or employees
of the Lessee, its officers and by public officials, except to the extent I have
actual knowledge to the contrary. In making my examination of documents and
instruments executed by any person or entity other than the Lessee, I have
assumed, without investigation, that each such other person or entity has (i)
the power, capacity, right and legal authority to enter into and perform all of
its obligations under such documents and instruments, (ii) duly authorized all
requisite action with respect to such documents and instruments, and (iii) duly
executed and delivered such documents and instruments.
Whenever a statement below is qualified by the phrase "known to me" or
"to my knowledge" it is intended to indicate that no information that would give
me actual knowledge of,
<PAGE>
Fleet Capital Corporation
July 11, 1996 Optical Coating
Page 2 Laboratory, Inc.
or a reasonable belief concerning, the inaccuracy of such statement has come to
my attention. Except as otherwise expressly indicated, I have not undertaken any
independent investigation to determine the accuracy of such statement, and any
limited inquiry undertaken by me during the preparation of this opinion letter
should not be regarded as such an investigation.
In rendering the opinions hereinafter expressed, I have also assumed,
without investigation, that the following facts are true:
Fleet will enforce its rights under the Master Lease in circumstances
and in a manner in which it is commercially reasonable to do so.
Fleet is not subject to any statute, role, or regulation, or to any
impediment to which contracting parties are generally not subject, which
requires the Lessee or any other person or party to obtain the consent of, or to
make a declaration or filing with, any governmental authority or other person or
entity.
The opinions expressed below are subject to the following
qualifications:
My opinions below are subject to the following: (a) the effect of
bankruptcy, insolvency, fraudulent conveyance, reorganization, arrangement,
moratorium, and other similar laws now or hereafter in effect relating to or
affecting the rights of creditors generally; (b) the limitations imposed by
California law, federal law, or equitable or public policy principles upon the
performance or enforceability of any of the remedies, covenants, or other
provisions of the Master Lease and upon the availability of injunctive relief or
other equitable remedies, including, without limitation, the effect of
California and federal court decisions invoking statutes or principles of equity
or of public policy, which have held that certain covenants and provisions of
agreements are unenforceable where: (i) the breach of such covenants or
provisions imposes restrictions or burdens upon the debtor, including
acceleration, termination or the imposition of late payment charges or increased
interest rates upon delinquency in the payment of sums or indebtedness due, and
it cannot be demonstrated that the enforcement of such restrictions or burdens
is reasonably necessary for the protection of the creditor, or (ii) the
creditor's enforcement of such covenants or provisions under the circumstances
would violate the creditor's implied covenant of good faith and fair dealing;
and (c) the limitations upon the ability of the Lessee or any other party to the
Master Lease to waive any rights, claims or defenses available to such party at
law or in equity pursuant to statute or otherwise.
In expressing my opinions below, I note that Fleet's right to enforce
remedies set forth in or permitted under the Master Lease may be subject to
various procedural limitations imposed by California law.
My opinions below are limited to the effect of the laws of the State of
California and of the federal laws of the United States. In addition, to the
extent that my opinions reach the validity or enforceability of the Master
Lease, I have assumed that such validity and enforceability is governed by the
law of the State of California applicable to agreements made and entirely
performed in California by California residents. I express no opinion regarding
the enforceability of the choice of law and other provisions contained in
paragraph 20 of the Master Lease.
My opinions with respect to the validity and enforceability of the
Master Lease do not reach the question of whether the Master Lease might be
re-characterized (for taxation or other purposes) as something other than a
lease (for example, a debt instrument). I express no opinion on the proper
characterization of the Master Lease (for taxation or any other purpose), and I
have assumed
<PAGE>
Fleet Capital Corporation
July 11, 1996
Page 3 Optical Coating
Laboratory, Inc.
for purposes of my opinions that a court will construe the Master Lease as a
lease document.
I have not made or undertaken to make any investigation of the state of
title to any real property or personal property, or of the filing or recordation
of any document or instrument. I express no opinion with respect to the title of
such real or personal property or to the priority of any lien or claim created
with respect thereto.
My opinions below are limited to matters expressly set forth in this
opinion letter, and no opinion is to be implied or may be inferred beyond the
matters expressly so stated.
Based upon and subject to the foregoing, I am of the opinion that:
1. Lessee is a corporation duly organized, validly existing and in good
standing under the laws of the state of Delaware and is qualified to do business
in each jurisdiction in which such qualification is necessary in order for
Lessee to carry out its business and to perform its obligations under the Master
Lease (including each state or other jurisdiction in which any of the Equipment
will be located), and is in good standing under the laws of each jurisdiction in
which it is so qualified.
2. Lessee has the requisite power and authority to execute and perform
the Master Lease and the transactions contemplated therein.
3. The transaction contemplated by the Master Lease, the execution and
delivery of the Master Lease and other related instruments, documents and
agreements, and the compliance by the Lessee with the terms thereof, and the
payment and performance by Lessee of all of its obligations thereunder (a) have
been duly and legally authorized by appropriate action taken by Lessee (b) are
not in contravention of, and will not result in a violation or breach of, any of
the terms of any Certificate of Incorporation (or equivalent document), By-Laws,
provisions relating to shares of the capital stocks, any provision of law, any
order of any court or other agency of government, or any indenture, partnership
agreement or certificate agreement or other instrument of which Lessee is a
party, or by or under which Lessee or any of Lessee's property is bound, or be
in conflict with, result in breach of, or constitute (with due notice and/or
lapse of time) a default under any such indenture, agreement or any instrument,
or result in the creation or imposition of any lien upon any of Lessee's
property or assets. In this regard, however, you have been informed that there
exists an agreement between the two current stockholders of Lessee pursuant to
which ownership and control of Lessee may change from Optical Coating
Laboratory, Inc. without any action on the part of Lessee.
4. The Master Lease has been executed by the duly authorized officer or
officers of Lessee and constitutes, the legal, valid and binding obligations of
Lessee, enforceable in accordance with its terms. The laws of the state of
California will not be applied in such a fashion that the transaction
contemplated by the Master Lease will be found to be usurious.
5. Neither the execution and delivery of the Master Lease, or the
payment and performance by Lessee of all of its obligations thereunder, required
the consent or approval of, the giving of notice to, or the registration, filing
or recording with, or the taking of any other action in respect of, any federal,
state or foreign government or governmental authority or agency or any other
person.
6. No mortgage, deed of trust or other lien which now covers or affects
or which may hereafter cover or affect any property or interest therein of
Lessee now attaches or hereafter will
<PAGE>
Fleet Capital Corporation
July 11, 1996 Optical Coating
Page 4 Laboratory, lnc.
attach to the Equipment or in any manner affects or will affect adversely your
right, title and interest therein.
7. There is no litigation or other proceeding now pending or, to the
best of my knowledge threatened, against the Lessee, in any court or before any
regulatory commission, board or other administrative governmental agency which
would directly or indirectly adversely affect or impair your title to the
equipment, or which, if decided adversely to Lessee, would materially adversely
affect the business operations or final condition of Lessee.
This opinion letter is rendered solely for the benefit of Fleet, its
successors and assigns. Without my prior written consent, this opinion letter
may not be relied upon by any other persons or entities.
Regards,
/s/ Joseph Zils
Joseph Zils
<PAGE>
SUPPORT AGREEMENT
BETWEEN FLEET CAPITAL CORPORATION,
OPTICAL COATING LABORATORY, INC.
AND FLEX PRODUCTS, INC.
This Support Agreement, made and entered into as of July 11, 1996,
between FLEET CAPITAL CORPORATION ("Fleet"), OPTICAL COATING LABORATORY, INC.
("Parent"), and FLEX PRODUCTS, INC. ("Subsidiary").
Recitals:
A. Parent owns sixty percent (60%) of the outstanding common stock of
Subsidiary; and
B. Subsidiary has entered into that certain Master Equipment Lease
Agreement No. 32089 dated as of June 19, 1996 (the "Agreement") under which
Subsidiary now has and/or shall incur certain liabilities and obligations to
Fleet; and
C. Parent and Subsidiary desire to take certain actions and enhance and
maintain the financial condition of Subsidiary as hereinafter set forth in order
that Subsidiary might meet its Obligations (as hereinafter defined) to Fleet.
NOW, THEREFORE, in consideration of the mutual promises herein
contained, the parties hereto agree as follows:
1. Stock Ownership. During the term of this Support Agreement, Parent
will maintain a majority of the voting capital stock of Subsidiary now or
hereafter issued and outstanding.
2. Financial Covenants. During such period of time as any of the
Obligations of the Lessee to Fleet are outstanding, Parent agrees that it shall
not accept any payment, whether by dividend, salary, bonus, commission, loan or
other compensation other than in the ordianry course of business, which would be
a contributing cause to Lessee's violation of, the terms and conditions of
Lessee's obligations to Fleet, including, but not limited to, Lessee's financial
covenants under the Agreement.
3. Performance Provision. Upon and during the pendancy of any default by
the Lessee which is caused in whole or in part by any payment to Parent other
than in the ordinary course of business, or by failure of Parent to pay amounts
owing to Subsidiary when due, or by transfer of Subsidiary's assets to Parent,
Parent agrees hereby to cause Subsidiary to fully and promptly perform all of
the obligations which Subsidiary presently has or hereafter may have to Fleet
whether under the Agreement or otherwise (collectively, the "Obligations"), and
agrees to indemnify Fleet against any loss which it may sustain, and expense it
may incur, in connection with such default.
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<PAGE>
4. Rights of Fleet. In the event that Subsidiary fails, is unable or
refuses to perform any of its Obligations in a timely manner, and such failure
to perform has been caused in whole or in part by a breach of Paragraph 2 or 3
of this Support Agreement by Parent, Fleet may proceed directly against Parent
to collect any of said Obligations and may exercise against Parent and/or
Subsidiary any rights and remedies that it may have under the Agreement or any
other agreement with respect to the Obligations. The obligations of Parent
hereunder shall not be affected by any waiver, modification, extension,
amendment or other change in any of the underlying Obligations between Fleet and
Subsidiary.
5. Termination; Amendment. This Support Agreement may be amended or
terminated at any time by written amendment or agreement signed by all parties.
6. Notices. Any notice, instruction, request, consent, demand or other
communication required or contemplated by this Support Agreement to be in
writing shal1 be given or made or communicated by first class mail, addressed as
follows:
If to Parent: Optical Coating Laboratory, Inc.
2789 Northpoint Parkway
Santa Rosa, CA 95047-7397
Attn: General Counsil
If to Subsidiary: Flex Products, Inc.
1402 Marina Way
Santa Rosa, CA 95407-7370
Attn: President
If to FLEET: Fleet Capital Corporation
50 Kennedy Plaza, 5th floor
Providence, RI 02903
Attn: Customer Service
7. Succcessors. The covenants, representations, warranties and
agreements herein set forth shall be mutually binding upon and inure to the
mutual benefit of Parent and its successors and Subsidiary and its successors
and Fleet and its successors and assigns.
8. Governing Law; Counterparts. This Support Agreement shall be governed
by the laws of the State of Rhode Island. This instrument may be executed in
counterparts and the executed counterparts shal1 together constitute one
instrument.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have set their hands and affixed
their corporate seals as of the day and year first above written.
OPTICAL COATING LABORATORY, INC.
By: /s/ John M. Markovich
------------------------------
Name: John M. Markovich
----------------------------
Title: VP Finance & CFO
---------------------------
FLEX PRODUCTS, INC.
By: /s/ Michael R. Sullivan
------------------------------
Name: Michael R. Sullivan
----------------------------
Title: President
---------------------------
FLEET CAPITAL CORPORATION
By: /s/ John J. Gould
------------------------------
Name: John J. Gould
----------------------------
Title: Vice President
---------------------------
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<PAGE>
[LOGO] Fleet SECRETARY'S CERTIFICATE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
The undersigned, Joseph C. Zils, the duly elected Secretary of OPTICAL COATING
LABORATORY, INC. (the "Corporation"), in order to induce Fleet Capital
Corporation ("FCC") to enter into one or more loans, leases or otherwise extend
financial accommodations to or for the benefit of the Corporation, hereby
certifies to FCC that:
(i) the Corporation is duly organized, validly existing and in good standing
under the laws of the State or Commonwealth of DELAWARE;
(ii) the Corporation has full corporate power and authority to enter into one or
more transactions, at any time and in any amount or form, with FCC: (a) to sell
to and/or lease or purchase from FCC any personal property or fixtures; (b) to
borrow and otherwise effect loans and advances or extensions of credit; (c) to
guaranty or otherwise provide financial accommodations or additional security
for the payment and performance of any obligations or indebtedness owing to FCC
by the Corporation or any other party; and (d) to sell, assign, transfer,
mortgage, pledge, hypothecate, grant security interests in, endorse and deliver
to FCC, any and all real or personal property of the Corporation, tangible or
intangible, of every name and description, as security for the payment and
performance of any obligations or indebtedness owing to FCC by the Corporation
or any other party, or otherwise in connection with any of the foregoing (the
"Authorized Transactions");
(iii) each of the officers designated below (an "Authorized Officer"), is a duly
elected (or appointed), qualified and acting officer of the Corporation, and the
signature appearing opposite his or her name below is his or her genuine
signature:
Name Office Signature
---- ------ ---------
John M. Markovich Vice President, CFO /s/ John M. Markovich
- ------------------------- ------------------------ -------------------------
- ------------------------- ------------------------ -------------------------
- ------------------------- ------------------------ -------------------------
(iv) each Authorized Officer has full power and authority to act alone on behalf
of the Corporation with respect to the Authorized Transactions and to do and
perform all acts and things, and to execute and deliver all instruments and
documents of every kind and nature he or she may deem necessary, proper or
incidental to, or which is otherwise required by FCC in connection with,
completion of the Authorized Transactions, including but not limited to one or
more leases, loan agreements, promissory notes, security agreements, schedules,
riders, certificates, guaranties, pledge agreements, subordination agreements,
purchase orders or agreements, disbursement authorizations, invoices, bills of
sale, intercreditor agreements, consents, disclaimers of interests, legal
opinions and UCC financing statements and any future modification(s) or
amendments thereof ("Authorized Documentation"), with such execution and
delivery to be conclusive evidence that such Authorized Transactions have been
duly and specifically authorized and approved by the Board of Directors of the
Corporation as being for the benefit of the Corporation in consideration of
reasonably equivalent value to the Corporation, and that such Authorized
Documentation is intended by the Board of Directors to constitute the valid and
legally binding obligations of the Corporation, enforceable by FCC in accordance
with their terms;
(v) all corporate votes, meetings, consents or other actions necessary or
appropriate to duly and properly authorize the Corporation to enter into the
Authorized Transactions and for the Authorized Officers to execute and deliver
the Authorized Documentation has been taken, and such corporate actions are in
full force and effect as of the date hereof and have not been modified or
rescinded in any respect;
(vi) all previous acts of, and all documents and papers heretofore executed and
delivered by, any Authorized Officer in connection with the Authorized
Transactions or any Authorized Documentation are ratified, confirmed and
approved as the act or acts of the Corporation; and
(vii) the Corporation shall furnish written notice to FCC of any revocation,
modification or amendment of any corporate action affecting any of the foregoing
certifications, and FCC shall be entitled to rely on these certifications until
such notice is received by FCC.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the
Corporation, this 11th day of July, 1996
/s/ Joseph C. Zils
------------------------------
Secretary
<PAGE>
MASTER EQUIPMENT LEASE AGREEMENT No. 32089
LESSOR: FLEET CAPITAL CORPORATION LESSEE: FLEX PRODUCTS, INC.
a Rhode Island corporation a Delaware corporation
Address: 50 Kennedy Plaza Address: 1402 Mariner Way
Providence, Rhode Island 02903-2305 Santa Rosa, California 95047
1. LEASE OF EQUIPMENT
Subject to the terms and conditions set forth herein (the "Master Lease") and
in any Lease Schedule incorporating the terms of this Master Lease (each, a
"Lease Schedule"). Lessor agrees to lease to Lessee, and Lessee agrees to lease
from Lessor, the items and units of personal property described in each such
Lease Schedule, together with all replacements, parts, additions, accessories
and substitutions therefor (collectively, the "Equipment"). Each Lease Schedule
shall constitute a separate, distinct and independent lease of Equipment and
contractual obligation of Lessee. References to "the Lease", "this Lease" or
"any Lease" shall mean and refer to any Lease Schedule which incorporates the
terms of this Master Lease, together with all exhibits, addenda, schedules,
certificates, riders and other documents and instruments executed and delivered
in connection with such Lease Schedule or this Master Lease, all as the same may
be amended or modified from time to time. The Equipment is to be delivered and
installed at the location specified or referred to in the applicable Lease
Schedule. The Equipment shall be deemed to have been accepted by Lessee for all
purposes under this Lease upon Lessor's receipt of an Acceptance Certificate
with respect to such Equipment, executed by Lessee after receipt of all other
documentation required by Lessor with respect to such Equipment. Lessor shall
not be liable or responsible for any failure or delay in the delivery of the
Equipment to Lessee for whatever reason. As used in the Lease with respect to
any item of Equipment, the terms "Acceptance Date", "Acquisition Cost", "Rental
Payment(s)", "Rental Payment Dates", "Rental Payment Numbers", "Rental Payment
Commencement Date", "Lease Term" and "Lease Term Commencement Date" shall have
the meanings and values assigned to them in the Lease Schedule and the
Acceptance Certificate applicable to such Equipment.
2. TERM AND RENT
The Lease Term for each item of Equipment shall be as specified in the
applicable Lease Schedule. Rental Payments shall be in the amounts and shall be
due and payable as set forth in the applicable Lease Schedule. If any rent or
other amount payable hereunder shall not be paid within 10 days of the date when
due, Lessee shall pay as an administrative and late charge an amount equal to 5%
of the amount of any such overdue payment. In addition, Lessee shall pay overdue
interest on any delinquent payment or other amounts due under the Lease (by
reason of acceleration or otherwise) from 30 days after the due date until paid
at the rate of 1 1/2% per month or the maximum amount permitted by applicable
law, whichever is lower. All payments to be made to Lessor shall be made to
Lessor in immediately available funds at the address shown above, or at such
other place as Lessor shall specify in writing. THIS IS A NON-CANCELABLE,
NON-TERMINABLE LEASE OF EQUIPMENT FOR THE ENTIRE LEASE TERM PROVIDED IN EACH
LEASE SCHEDULE HERETO.
3. POSSESSION; PERSONAL PROPERTY
No right, title or interest in the Equipment shall pass to Lessee other than
the right to maintain possession and use of the Equipment for the Lease Term
(provided no Event of Default has occurred) free from interference by any person
claiming by, through, or under Lessor. The Equipment shall always remain
personal property even though the Equipment may hereafter become attached or
affixed to real property. Lessee agrees to give and record such notices and to
take such other action at its own expense as may be necessary to prevent any
third party (other than an assignee of Lessor) from acquiring or having the
right under any circumstances to acquire any interest in the Equipment or this
Lease.
4. DISCLAIMER OF WARRANTIES
LESSOR IS NOT THE MANUFACTURER OR SUPPLIER OF THE EQUIPMENT, NOR THE AGENT
THEREOF, AND MAKES NO EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES AS TO ANY
MATTER WHATSOEVER, INCLUDING WITHOUT LIMITATION, THE MERCHANTABILITY OF THE
EQUIPMENT, ITS FITNESS FOR A PARTICULAR PURPOSE, ITS DESIGN OR CONDITION, ITS
CAPACITY OR DURABILITY, THE QUALITY OF THE MATERIAL OR WORKMANSHIP IN THE
MANUFACTURE OR ASSEMBLY OF THE EQUIPMENT, OR THE CONFORMITY OF THE EQUIPMENT TO
THE PROVISIONS AND SPECIFICATIONS OF ANY PURCHASE ORDER RELATING THERETO, OR
PATENT INFRINGEMENTS, AND LESSOR HEREBY DISCLAIMS ANY SUCH WARRANTY. LESSOR IS
NOT RESPONSIBLE FOR ANY REPAIRS OR SERVICE TO THE EQUIPMENT, DEFECTS THEREIN OR
FAILURES IN THE OPERATION THEREOF. Lessee has made the selection of each item of
Equipment and the manufacturer and/or supplier thereof based on its own judgment
and expressly disclaims any reliance upon any statements or representations made
by Lessor. For so long as no Event of Default (or event or condition which, with
the passage of time would become such an Event of Default) has occurred and is
continuing, Lessee shall be the beneficiary of, and shall be entitled to, all
rights under any applicable manufacturer's or vendor's warranties with respect
to the Equipment, to the extent permitted by law.
If the Equipment is not delivered, is not properly installed, does not
operate as warranted, becomes obsolete, or is unsatisfactory for any reason
whatsoever, Lessee shall make all claims on account thereof solely against the
manufacturer or supplier and not against Lessor, and Lessee shall nevertheless
pay all rentals and other sums payable hereunder. Lessee acknowledges that
neither the manufacturer or supplier of the Equipment, nor any sales
representative or agent thereof, is an agent of Lessor, and no agreement or
representation as to the Equipment or any other matter by any such sales
representative or agent of the manufacturer or supplier shall in any way affect
Lessee's obligations hereunder.
5. REPRESENTATIONS, WARRANTIES AND COVENANTS
Lessee represents and warrants to and covenants with Lessor that:
(a) Lessee has the form of business organization indicated above and is duly
organized and existing in good standing under the laws of the state listed in
the caption of this Master Lease and is duly qualified to do business wherever
necessary to carry on its present business and operations and to own its
property; (b) this Lease has been duly authorized by all necessary action on the
part of Lessee consistent with its form of organization, does not require any
further shareholder or partner approval, does not require the approval of, or
the giving notice to, any federal, state, local or foreign governmental
authority and does not contravene any law binding on Lessee or contravene any
certificate or articles of incorporation or by-laws or partnership certificate
or agreement, or any agreement, indenture, or other instrument to which Lessee
is a party or by which it may be bound; (c) this Lease has been duly executed
and delivered by authorized officers or partners of Lessee and constitutes a
legal, valid and binding obligation of Lessee enforceable in accordance with its
terms; (d) Lessee has not and will not, directly or indirectly, create, incur or
permit to exist any lien, encumbrance, mortgage, pledge, attachment or security
interest on or with respect to the Equipment or this Lease (except those of
persons claiming by, through or under Lessor); (e) the Equipment will be used
solely in the conduct of Lessee's business and will remain in the location shown
on the applicable Lease Schedule unless Lessor otherwise agrees in writing and
Lessee has completed all notifications, filings, recordings and other actions in
such new location as Lessor may reasonably request to protect Lessor's interest
in the Equipment; (f) there are no pending or threatened actions or proceedings
before any court or administrative agency which materially adversely affect
Lessee's financial condition or operations, and all credit, financial and other
information provided by Lessee or at Lessee's direction is, and all such
information hereafter furnished will be, true, correct and complete in all
material respects; (g) Lessor has not selected, manufactured or supplied the
Equipment to Lessee and has acquired any Equipment subject hereto solely in
connection with this Lease and Lessee has received and approved the terms of any
purchase order or agreement with respect to the Equipment; (h) Lessee shall
maintain, as of the end of each of Lessee's fiscal quarters, a Fixed Charge
Coverage Ratio of not less than 1.75:1 for each cumulative four quarter period
(if Lessee issues stock through an initial public stock offering ("IPO") (x)
during its fiscal quarter ending April 30, 1997, and the net proceeds to Lessee
from such IPO are no less than $15,0OO,000, and at the conclusion of such fiscal
quarter Lessee's TangibLe Net Worth is no less than the Base Net Worth, or (y)
after April 30, 1997, and Lessee's Tangible Net Worth, immediately following
such IPO, is no less than the Base Net Worth plus 50% of Lessee's total Net
Income for each fiscal quarter from and after the fiscal quarter ending July 31,
1997, to the date of the
Page 1 of 5
<PAGE>
IPO, Lessee shall thereafter maintain a Fixed Charge Coverage Ratio of no less
than 1.2:1); (i) Lessee shall maintain a ratio of total liabilities (including
the present value of non-cancelable equipment operating lease rentals) to
Tangible Net Worth of not more than 2.75:1 through until July 31, 1997, and of
not more than 2.0:1 thereafter; (j) Lessee shall maintain a Tangible Net Worth
of not less than $7,728,000 (the "Minimum Tangible Net Worth") through April 30,
1996, which Minimum Tangible Net Worth shall increase as of the end of each of
Lessee's fiscal quarters thereafter by the sum of (x) 50% of Lessee's Net Income
during such quarter and (y) 80% of the net proceeds of any stock issued by
Lessee during such quarter; (k) Lessee shall not make any payments to
shareholders, whether by dividend, commission, repayment of debt, loan or other
payments, if such payments would cause Lessee's cumulative four quarter Adjusted
Fixed Charge Coverage Ratio to be less than 1.0:1 or Lessee's Current Ratio to
be less than 1.2:1 or result in Lessee's breach of any other covenant herein;
and (1) more than 50% of Lessee's voting capital stock, or effective control of
Lessee's voting capital stock, issued and outstanding from time to time, shall
be retained by Optical Holding Laboratory, Inc., ("OCLI"). Notwithstanding the
provisions set forth in Section 5 (1) above, in the event that SICPA Holding,
S.A. ("SICPA") acquires more than 50% of Lessee's voting capital stock, or
effective control of Lessee's voting capital stock, issued and outstanding from
time to time, Lessor agrees that, upon delivery of such financial information on
SICPA as Lessor deems necessary, Lessor shall consider a request by Lessee to
substitute SICPA for OCLI for purposes of the covenant set forth in Section 5
(1). The sale of the Equipment by Lessee to Lessor and Lessee's undertaking of
the obligations contained herein shall not cause Lessee to be insolvent within
the meaning of applicable state and/or federal laws. The payment by Lessor to
Lessee of the Acquisition Cost of the Equipment, as set forth from time to time
on the Acquisition Certificate, is fair consideration for each item of Equipment
within the meaning of applicable state and federal laws.
Without limiting the generality of any of the foregoing representations and
warranties, the sale by Lessee to Lessor of the Equipment does not require any
stockholder approval or consent of any trustee or holders of any indebtedness or
obligations of Lessee and will not, to Lessee's knowledge, contravene any laws,
statutes, regulations, judgments or decrees applicable to Lessee, including, but
not limited to, laws or statutes regarding fraudulent conveyances, bankruptcy,
creditors' rights or bulk transfers, or the certificate of incorporation or
by-laws of Lessee, or contravene the provisions of, or constitute a default
under, or violate any restrictive covenants or other agreement to which Lessee
is a party or by which Lessee or its assets may be bound or affected, and any
authorization, approval, license, filing or registration with any court or
governmental agency or instrumentality which is necessary in connection with
such sale has, to Lessee's knowledge, been effected and a written copy thereof
has been delivered to Lessor. Lessee has full power, authority and legal right
to sell the Equipment to Lessor. The sale of the Equipment to Lessor has been
duly authorized by all necessary corporate action and constitutes a legal, valid
and binding obligation of Lessee. Lessor's decision to accept such substitution
shall be made in Lessor's sole discretion and will require, among other things,
the execution of a Support Agreement from SICPA substantially in the form of the
Support Agreement executed by OCLI.
For the purposes of this section the following definitions shall apply:
"Adjusted Fixed Charge Coverage Ratio" shall be defined as the sum of Net
Income, depreciation, amortization, interest expense, taxes on income, and
operating lease payments divided by the sum of interest expense, current
maturities of long term debt, operating lease payments, net repayment of
shareholder debt on an intra-quarterly basis, and dividend payments.
"Base Net Worth" shall be defined as the sum of the net proceeds received
by Lessee from the issuance of stock through an IPO and $15,000,000.
"Current Ratio" shall be defined as all cash, cash equivalents, accounts
receivable, inventory, prepaid expenses, and other current rights to
receive payments as of the date of determination thereof in accordance with
generally accepted accounting principles ("GAAP") divided by all
liabilities which should, in accordance with GAAP consistently applied, be
classified as current liabilities, and in any event including all
indebtedness payable on demand or within one year from the date of
determination without any option on the part of Lessee to extend or renew
beyond such year, and including the current portion of long term debt
required to be paid within one year.
"Fixed Charge Coverage Ratio" shall be defined as the sum of net income,
depreciation, amortization, interest expense, and operating lease payments
divided by the sum of interest expense, current maturities of long term
debt, and operating lease payments.
"Tangible Net Worth" shall be defined as the excess of all assets,
excluding any value for goodwill, trademarks, patents, copyrights,
organization expense, other similar intangible items, and receivables from
stockholders that do not arise from the sale of product to stockholders,
employees and affiliated companies, over total liabilities.
All other financial terms used herein and not defined herein, shall be
defined in accordance with GAAP, consistently applied.
6. INDEMNITY
Lessee assumes the risk of liability for, and hereby agrees to indemnify and
hold safe and harmless, and covenants to defend, Lessor, its employees, servants
and agents from and against: (a) any and all liabilities, losses, damages,
claims and expenses (including legal expenses of every kind and nature) arising
out of the manufacture, purchase, shipment and delivery of the Equipment to
Lessee, acceptance or rejection, ownership, titling, registration, leasing,
possession, operation, use, return or other disposition of the Equipment,
including, without limitation, any liabilities that may arise from patent or
latent defects in the Equipment (whether or not discoverable by Lessee), any
claims based on absolute tort liability or warranty and any claims based on
patent, trademark or copyright infringement; (b) any and all loss or damage of
or to the Equipment; and (c) any obligation or liability to the manufacturer or
any supplier of the Equipment arising under any purchase orders issued by or
assigned to Lessor.
7. TAXES AND OTHER CHARGES
Lessee agrees to comply with all laws, regulations and governmental orders
related to this Lease and to the Equipment and its use or possession, and to pay
when due, and to defend and indemnify Lessor against liability for all license
fees, assessments, and sales, use, property, excise, privilege and other taxes
(including any related interest or penalties) or other charges or fees now or
hereafter imposed by any governmental body or agency upon any Equipment, or with
respect to the manufacturing, ordering, shipment, purchase, ownership, delivery,
installation, leasing, operation, possession, use, return, or other disposition
thereof or the rentals hereunder (other than taxes on or measured solely by the
net income of Lessor). Any fees, taxes or other lawful charges paid by Lessor
upon failure of Lessee to make such payments shall at Lessor's option become
immediately due from Lessee to Lessor.
Lessor and Lessee agree that Lessor is the owner of the Equipment for Federal
income tax purposes. Lessee covenants that it shall not take any action which is
inconsistent with Lessor's ownership of the Equipment.
For purposes of this Section 7, the term Tax Benefits shall mean cost
recovery deductions under Section 168 of the Internal Revenue Code of 1986, as
amended, using a 200% declining balance method of depreciation switching to the
straight line method for the first taxable year for which such method will yield
larger depreciation deductions, and assuming a half-year convention and zero
salvage value, for the applicable recovery period for such Equipment as set
forth in the Lease Schedule with respect to such Equipment.
If, as a result of any act, failure to act or any omission on the part of
Lessee, or breach of any representation, warranty or covenant made by Lessee
hereunder, there shall be a loss, disallowance, recapture or delay in claiming
all or any portion of the Tax Benefits with respect to the Equipment, or there
shall be included in Lessor's gross income for Federal, state or local income
tax purposes any amount on account of any addition, modification or improvement
to or in respect of any of the Equipment made or paid for by Lessee (any loss,
disallowance, recapture, delay, inclusion or change being herein called a "Tax
Loss"), then thirty (30) days after written notice to Lessee by Lessor that a
Tax Loss has occurred, Lessee shall pay Lessor a lump sum amount which, after
deduction of all taxes required to be paid by Lessor with respect to the receipt
of such amount, will provide Lessor with an amount necessary to maintain
Lessor's after-tax economic yield and overall net after-tax cash flows at least
at the same level that would have been available if such Tax Loss had not
occurred, plus any interest, penalties or additions to tax which may be imposed
in connection with such Tax Loss. In lieu of paying such Tax Loss in a lump sum,
Lessor may require, or upon Lessee's request, may agree, in Lessor's sole
discretion, that such Tax Loss shall be paid in equal periodic payments over the
applicable remaining Lease Term with respect to such Equipment with each Rental
Payment due and payable with respect to such Equipment. Notwithstanding, and in
addition to, the
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<PAGE>
portion of the Tax Benefits with respect to the Equipment and such loss of Tax
Benefits is the result of any act, failure to act or any omission on the part of
Lessee or a breach of any representation, warranty or covenant made by Lessee
hereunder, and either (a) a deficiency shall have been proposed by the Internal
Revenue Service or other taxing authority having jurisdiction, or (b) tax
counsel for Lessor has rendered an opinion to Lessor that such Tax Loss has so
occurred. The foregoing indemnities and covenants set forth in Section 7 of this
Master Lease shall continue in full force and effect and shall survive the
expiration or earlier termination of the Lease.
8. DEFAULT
Lessee shall be in default of this Lease upon the occurrence of any one or
more of the following events (each an "Event of Default"):
(a) Lessee shall fail to make any payment, of rent or otherwise, under any
Lease within 10 days of the date when due; or (b) Lessee shall fail to obtain or
maintain any of the insurance required under any Lease; or (c) Lessee shall fail
to perform or observe any covenant, condition or agreement under any Lease, and
such failure continued for 10 days after notice thereof to Lessee, provided,
however, that no such failure to perform or observe shall constitute an Event of
Default hereunder, where Lessee has commenced curing such failure to perform or
observe within such ten (10) day period and continues to diligently pursue such
cure in the opinion of Lessor; or (d) Lessee shall default in the payment or
performance of any indebtedness or obligation to Lessor or any affiliated
person, firm or entity controlling, controlled by or under common control with
Lessor, under any loan, note, security agreement, lease, guaranty, title
retention or conditional sales agreement or any other instrument or agreement
evidencing such indebtedness with Lessor or such other affiliated person, firm
or entity affiliated with Lessor; or (e) any representation or warranty made by
Lessee herein or in any certificate, agreement, statement or document hereto or
hereafter furnished to Lessor in connection herewith, including without
limitation, any financial information, disclosed to Lessor shall prove to be
false or incorrect in any material respect; or (f) death or judicial declaration
of incompetence of Lessee, it an individual; the commencement of any bankruptcy,
insolvency, arrangement, reorganization, receivership, liquidation or other
similar proceeding by or against Lessee or any of its properties or businesses,
or the appointment of a trustee, receiver, liquidator or custodian for Lessee or
any of its properties of business, or if Lessee suffers the entry of an order
for relief under Title 11 of the United States Code; or the making by Lessee era
general assignment or deed of trust for the benefit of creditors, or (g) Lessee
shall default in any payment on any obligation to any third party, which is
greater than $1,000,000, and any applicable grace or cure period with respect:
thereto has expired; or (h) Lessee shall terminate its existence by merger,
consolidation, sale of substantially all of its assets or otherwise; or (i)
Lessee shall be in breach of Section 5 (1) hereof as such Section 5 (1) may be
revised from time to time pursuant to the terms of Section 5; or (j) if Lessee
is a publicly held corporation, there shall be a change in the ownership of
Lessee's stock such that Lessee is no longer subject to the reporting
requirements of the Securities Exchange Act of 1934, or no longer has a class of
equity securities registered under Section 12 of the Securities Act of 1933; or
(k) Lessor shall determine, in its sole discretion and in good faith, that there
has been a material adverse change in the financial condition of the Lessee
since the date of this Lease, or that Lessee's ability to make any payment
hereunder promptly when due or otherwise comply with the terms of this Lease or
any other agreement between Lessor and Lessee is impaired; or (l) any event or
condition set forth in subsections (e), (f) or (h) of this Section 8 shall occur
with respect to any guarantor or other person responsible, in whole or in part,
for payment or performance of this Lease; or (m) any event or condition set
forth in subsections (d) through (j) shall occur with respect to any person,
firm or entity controlled by Lessee. Lessee shall promptly notify Lessor of the
occurrence of any Event of Default or the occurrence or existence of any event
or condition which, upon the giving of notice of lapse of time, or both, may
become an Event of Default.
9. REMEDIES
Upon the occurrence of any Event of Default, Lessor may, at its sole option
and discretion, exercise one or more of the following remedies with respect to
any or all of the Equipment: (a) cause Lessee to promptly return, at Lessee's
expense, any or all Equipment to such location as Lessor may designate in
accordance with the terms of Section 18 of this Master Lease, or Lessor, at its
option, may enter upon the premises where the Equipment is located and take
immediate possession of and remove the same by summary proceedings or otherwise,
all without liability to Lessor for or by reason of damage to property or such
entry or taking possession except for Lessor's gross negligence or willful
misconduct; (b) sell any or all Equipment at public or private sale or otherwise
dispose of, hold, use, operate, lease to others or keep idle the Equipment, all
as Lessor in its sole discretion may determine and all free and clear of any
rights of Lessee; (c) remedy such default, including making repairs or
modifications to the Equipment, for the account and expense of Lessee, and
Lessee agrees to reimburse Lessor for all of Lessor's costs and expenses; (d) by
written notice to Lessee, terminate the Lease with respect to any or all Lease
Schedules and the Equipment subject thereto, as such notice shall specify, and,
with respect to such terminated Lease Schedules and Equipment, declare
immediately due and payable and recover from Lessee, as liquidated damages for
loss of Lessor's bargain and not as a penalty, an amount equal to the Stipulated
Loss Value, calculated as of the next following Rental Payment Date: (e) apply
any deposit or other cash collateral or sale or remarketing proceeds of the
Equipment at any time to reduce any amounts due to Lessor, and (f) exercise any
other right or remedy which may be available to Lessor under applicable law, or
proceed by appropriate court action to enforce the terms hereof or to recover
damages for the breach hereof, including reasonable attorneys' fees and court
costs. No remedy referred to in this Section 9 shall be exclusive, but each
shall be cumulative and in addition to any other remedy referred to above or
otherwise available to Lessor at law or in equity.
The exercise or pursuit by Lessor of any one or more of such remedies shall
not preclude the simultaneous or later exercise or pursuit by Lessor of any or
all such other remedies, and all remedies hereunder shall survive termination of
this Lease. At any sale of the Equipment pursuant to this Section 9, Lessor may
bid for the Equipment. Notice required, if any, of any sale or other disposition
hereunder by Lessor shall be satisfied by the mailing of such notice to Lessee
at least seven (7) days prior to such sale or other disposition. In the event
Lessor takes possession and disposes of the Equipment, the proceeds of any such
disposition shall be applied in the following order: (1) to all of Lessor's
costs, charges and expenses incurred in taking, removing, holding, repairing and
selling or leasing the Equipment; (2) to the extent not previously paid by
Lessee, to pay Lessor for any damages then remaining unpaid hereunder; (3) to
reimburse Lessee for any sums previously paid by Lessee as damages hereunder;
and (4) the balance, if any, shall be retained by Lessor. A termination shall
occur only upon written notice by Lessor and only with respect to such Equipment
as Lessor shall specify in such notice. Termination under this Section 9 shall
not affect Lessee's duty to perform Lessee's obligations hereunder to Lessor in
full. Lessee agrees to reimburse Lessor on demand for any and all costs and
expenses incurred by Lessor in enforcing its rights and remedies hereunder
following the occurrence of an Event of Default, including, without limitation,
reasonable attorney's fees, and the costs of repossession, storage, insuring,
reletting, selling and disposing of any and all Equipment.
The term "Stipulated Loss Value" with respect to any item of Equipment shall
mean the Stipulated Loss Value as set forth in any Schedule of Stipulated Loss
Values attached to and made a part of the applicable Lease Schedule. If there is
no such Schedule of Stipulated Loss Values, then the Stipulated Loss Value with
respect to any item of Equipment on any Rental Payment Date during the Lease
Term shall be an amount equal to the sum of: (a) all Rental Payments and other
amounts then due and owing to Lessor under the Lease, together with all accrued
interest and late charges thereon calculated through and including the date of
payment; plus (b) the net present value of: (i) all Rental Payments then
remaining unpaid for the Lease Term, plus (ii) the amount of any purchase
obligation with respect to the Equipment or, if there is no such obligation,
then the fair market value of the Equipment at the end of such term, as
estimated by Lessor in its sole discretion, all discounted to net present value
at a discount rate equal to the 1-year Treasury Constant Maturity rate as
published in the Selected Interest Rates table of the Federal Reserve
statistical release H.15(519) for the week ending immediately prior to the
original Acceptance Date for such Equipment.
10. ADDITIONAL SECURITY
For so long as any obligations of Lessee shall remain outstanding under any
Lease, Lessee hereby grants to Lessor a security interest in all of Lessee's
rights in and to Equipment subject to such Lease from time to time, to secure
the prompt payment and performance when due (by reason of acceleration or
otherwise) of each and every indebtedness, obligation or liability of Lessee, or
any affiliated person, firm, or entity controlled by Lessee, owing to Lessor,
whether now existing or hereafter arising, including but not limited to all of
such obligations under or in respect of any Lease. The extent to which Lessor
shall have a purchase money security interest in any item of Equipment under a
Lease which is deemed to create a security interest under Section 1-201(37) of
the Uniform Commercial Code shall be determined by reference to the Acquisition
Cost of such item financed by Lessor. In order more fully to secure its rental
payments and all other obligations to Lessor hereunder, Lessee hereby grants to
Lessor a security interest in any deposit of Lessee to Lessor under Section 3(d)
of any Lease Schedule hereto. Such security deposit shall not bear interest, may
be commingled with other funds of Lessor and shall be immediately restored by
Lessee if applied under Section 9. Upon expiration of the term of this Lease and
satisfaction of all of Lessee's obligations, the security deposit shall be
returned to Lessee. The term "Lessor" as used in this Section 10 shall include
any affiliated person, firm or entity controlling, controlled by or under common
control with Lessor.
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11. NOTICES
Any notices or demands required or permitted to be given under this Lease
shall be given in writing and either (i) by regular mail, by hand or by
overnight courier, which notice shall become effective when received, or (ii) by
facsimile or other form of electronic transmission, which notice shall become
effective upon transmission thereof, such notice shall be addressed to Lessor to
the attention of Customer Accounts, and to Lessee at the address set forth
above, or to such other address as the party to receive notice hereafter
designates by such written notice.
12. USE; MAINTENANCE; INSPECTION; LOSS AND DAMAGE
During the Lease Term for each item of Equipment, Lessee shall, unless Lessor
shall otherwise consent in writing: (a) permit each item of Equipment to be used
only within the continental United States by qualified personnel solely for
business purposes and the purpose for which it was designed and shall, at its
sole expense, service, repair, overhaul and maintain each item of Equipment in
the same condition as when received, ordinary wear and tear excepted, in good
operating order, consistent with prudent industry practice (but, in no event
less than the same extent to which Lessee maintains other similar equipment in
the prudent management of its assets and properties) and in compliance with all
applicable laws, ordinances, regulations, and conditions of all insurance
policies required to be maintained by Lessee under the Lease and all manuals,
orders, recommendations, instructions and other written requirements as to the
repair and maintenance of such item of Equipment issued at any time by the
vendor and/or manufacturer thereof; (b) maintain conspicuously on each item of
Equipment such labels, plates, decals or other markings as Lessor may reasonably
require, stating that Lessor is owner of such item of Equipment; (c) furnish to
Lessor such information concerning the condition, location, use and operation of
the Equipment as Lessor may request; (d) upon reasonable advance notice, permit
any person designated by Lessor to visit and inspect, during normal business
hours, any item of Equipment and any records maintained in connection
therewith, provided, however, that the failure of Lessor to inspect the
Equipment or to inform Lessee of any noncompliance shall not relieve Lessee of
any of its obligations hereunder; (e) if any item of Equipment does not comply
with the requirements of this Lease, Lessee shall, within 30 days of written
notice from Lessor, bring such Equipment into compliance; (f) not use any
Equipment, nor allow the same to be used, for any unlawful purpose, nor in
connection with any property or material that would subject the Lessor to any
liability under any state or federal statute or regulation pertaining to the
production, transport, storage, disposal or discharge of hazardous or toxic
waste or materials; and (g) make no additions, alterations, modifications or
improvements (collectively, "Improvements") to any item of Equipment that are
not readily removable without causing material damage to such item of Equipment
or which will cause the value, utility or useful life of such item of Equipment
to materially decline. If any such Improvement is made and cannot be removed
without causing material damage or decline in value, utility or useful life (a
"Non-Severable Improvement"), then Lessee warrants that such Non-Severable
Improvement shall immediately become Lessor's property upon being installed and
shall be free and clear of all liens and encumbrances and shall become Equipment
subject to all of the terms conditions of the Lease. All such Improvements that
are not Non-Severable Improvements shall be removed by Lessee prior to the
return of the item of Equipment hereunder or such Improvements shall also become
the sole and absolute property of Lessor without any further payment by Lessor
to Lessee and shall be free and clear of all liens and encumbrances whatsoever.
Lessee shall repair all damage to any item of Equipment caused by the removal of
any Improvement so as to restore such item of Equipment to the same condition
which existed prior to its installation and as required by this Lease.
Lessee hereby assumes all risk of loss, damage or destruction for whatever
reason to the Equipment from and after the earlier of the date (i) on which the
Equipment is ordered or (ii) Lessor pays the purchase price of the Equipment,
and continuing until the Equipment has been returned to, and accepted by, Lessor
in the condition required by Section 18 hereof upon the expiration of the Lease
Term. If during the Lease Term any item of Equipment shall become lost, stolen,
destroyed, damaged beyond repair or rendered permanently unfit for use for any
reason, or in the event of any condemnation, confiscation, theft or seizure or
requisition of title to or use of such item, Lessee shall immediately pay to
Lessor an amount equal to the Stipulated Loss Value of such item, as of the next
following Rental Payment Date.
13. INSURANCE
Lessee shall procure and maintain insurance in such amounts and upon such
terms and with such companies as Lessor may approve, during the entire Lease
Term and until the Equipment has been returned to, and accepted by, Lessor in
the condition required by Section 18 hereof, at Lessee's expense, provided that
in no event shall such insurance be less than the following coverages and
amounts: (a) Worker's Compensation and Employer's Liability Insurance, in the
full statutory amounts provided by law; (b) Comprehensive General Liability
Insurance including product/completed operations and contractual liability
coverage, with minimum limits of $1,000,000 each occurrence. and Combined Single
Limit Body Injury and Property Damage, $1,000,000 aggregate, where applicable;
and (c) All Risk Physical Damage Insurance, including earthquake and flood, on
each item of Equipment, in an amount not less than the greater of the Stipulated
Loss Value of the Equipment or (if available) its full replacement value. Lessor
will be included as an additional insured and loss payee as its interest may
appear. Such policies shall be endorsed to provide that the coverage afforded to
Lessor shall not be rescinded, impaired or invalidated by any act or neglect of
Lessee. Lessee agrees to waive Lessee's right and its insurance carrier's rights
of subrogation against Lessor for any and all loss or damage.
Notwithstanding the foregoing, Lessee shall not be required to maintain
earthquake insurance in an amount in excess of the then current Stipulated Loss
Value with a 15% deductible.
In addition to the foregoing minimum insurance coverage, Lessee shall procure
and maintain such other insurance coverage as lessor may reasonably require from
time to time during the Lease Term. All policies shall be endorsed to contain a
clause requiring the insurer to furnish Lessor with at least 30 days' prior
written notice of any material change, cancellation or non-renewal of coverage.
Upon execution of this Lease, Lessee shall furnish Lessor with a certificate of
insurance or other evidence satisfactory to Lessor that such insurance coverage
is in effect, provided, however, that Lessor shall be under no duty either to
ascertain the existence of or to examine such insurance coverage or to advise
Lessee in the event such insurance coverage should not comply with the
requirements hereof. In case of failure of Lessee to procure or maintain
insurance, Lessor may at its option obtain such insurance, the cost of which
will be paid by the Lessee as additional rentals. Lessee hereby irrevocably
appoints Lessor as Lessee's attorney-in-fact to file, settle or adjust, and
receive payment of claims under any such insurance policy and to endorse
Lessee's name on any checks, drafts or other instruments on payment of such
claims. Lessee further agrees to give Lessor prompt notice of any damage to or
loss of, the Equipment, or any part thereof.
14. LIMITATION OF LIABILITY
Lessor shall have no liability in connection with or arising out of the
ownership, leasing, furnishing, performance or use of the Equipment or any
special, indirect, incidental or consequential damages of any character,
including, without limitation, loss of use of production facilities or
equipment, loss of profits, property damage or lost production, whether suffered
by Lessee or any third party.
15. FURTHER ASSURANCES
Lessee shall promptly execute and deliver to Lessor such further documents
and take such further action as Lessor may reasonably require in good faith, in
order to more effectively carry out the intent and purpose of this Lease. Lessee
shall provide to Lessor, within 120 days after the close of each of Lessee's
fiscal years, and, within 45 days of the end of each quarter of Lessee's fiscal
year, a copy of its financial statements prepared in accordance with generally
accepted accounting principles and, in the case of annual financial statements,
audited by independent certified public accountants, and in the case of
quarterly financial statements certified by Lessee's chief financial officer,
each such financial statement to be accompanied by a Compliance Certificate,
substantially in the form of Exhibit A attached hereto, certified by Lessee's
chief financial officer, as to Lessee's compliance with subsections (h) through
(k) of Section 5 above. Lessee shall execute and deliver to Lessor upon Lessor's
request such instruments and assurances as Lessor deems necessary for the
confirmation, preservation or perfection of this Lease and Lessor's rights
hereunder, including, without limitation, such corporate resolutions and
opinions of counsel as Lessor may request from time to time, and all schedules,
forms and other reports as may be required to satisfy obligations imposed by
taxing authorities. In furtherance thereof, Lessor may file or record this Lease
or a memorandum or a photocopy hereof (which for the purposes hereof shall be
effective as a financing statement) so as to give notice to third parties; and
Lessee hereby appoints Lessor as its attorney-in-fact to execute, sign, file and
record UCC financing statements and other lien recordation documents with
respect to the Equipment where Lessee fails or refuses to do so after Lessor's
written request, and Lessee agrees to pay or reimburse Lessor for any filing,
recording or stamp fees or taxes arising from any such filings.
16. ASSIGNMENT
This Lease and all rights of Lessor hereunder shall be assignable by Lessor
absolutely or as security, without notice to Lessee, subject to the rights of
Lessee hereunder for the use and possession of the Equipment for so long as no
Event of Default has occurred and is continuing hereunder. Any such assignment
shall not relieve Lessor of its obligations hereunder unless specifically
assumed by the assignee, and Lessee
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agrees it shall not assert any defense, rights of set-off or counterclaim
against any assignee to which Lessor shall have assigned its rights and
interests hereunder, nor hold or attempt to hold such assignee liable for any of
Lessor's obligations hereunder. No such assignment shall materially increase
Lessee's obligations hereunder. Lessee agrees, upon Lessor's written request, to
provide to any such assignee an acknowledgment of such assignment confirming the
terms, conditions, representations, warranties and covenants contained in this
Lease.
LESSEE SHALL NOT ASSIGN OR DISPOSE OF ANY OF ITS RIGHTS OR OBLIGATIONS UNDER
THIS LEASE OR ENTER INTO ANY SUBLEASE WITH RESPECT TO ANY OF THE EQUIPMENT
WITHOUT THE EXPRESS PRIOR WRITTEN CONSENT OF LESSOR.
17. LESSEE'S OBLIGATION UNCONDITIONAL
This Lease is a net lease and Lessee hereby agrees that it shall not be
entitled to any abatement of rents or of any other amounts payable hereunder by
Lessee, and that its obligation to pay all rent and any other amounts owing
hereunder shall be absolute and unconditional under all circumstances,
including, without limitation, the following circumstances: (i) any claim by
Lessee to any right of set-off, counterclaim, recoupment, defense or other right
which Lessee may have against Lessor, any seller or manufacturer of any
Equipment or anyone else for any reason whatsoever; (ii) the existence of any
liens, encumbrances or rights of others whatsoever with respect to any
Equipment, whether or not resulting from claims against Lessor not related to
the ownership of such Equipment; or (iii) any other event or circumstances
whatsoever. Each Rent Payment or other amount paid by Lessee hereunder shall be
final and Lessee will not seek to recover all or any part of such payment from
Lessor for any reason whatsoever.
18. RETURN OF EQUIPMENT
Upon the expiration or earlier termination of the Lease Term with respect to
any item of Equipment, and provided that Lessee has not validly exercised any
purchase option with respect thereto, Lessee shall: (a) return the Equipment to
a location and in the manner designated by the Lessor within the continental
United States, including, as reasonably required by Lessor, securing
arrangements for the disassembly and packing for shipment by an authorized
representative of the manufacturer of the Equipment, shipment with all parts and
pieces on a carrier designated or approved by Lessor, and then reassembly
(including, if necessary, repair and overhaul) by such representative at the
return location in the condition the Equipment is required to be maintained by
the Lease and in such condition as will make the Equipment (in its original
configuration or as upgraded) immediately able to satisfy the acceptance test
protocol used to accept the Equipment from the original equipment manufacturer),
and immediately qualified for the manufacturer's (or other authorized servicing
representatives) then-available service contract or warranty (Lessee may replace
any proprietary optical monitoring systems with commercially available optical
monitoring systems, at Lessee's sole expense); (b) cause the Equipment to
qualify for all applicable licenses or permits necessary for its operation for
its intended purpose and to comply with all specifications and requirements of
applicable federal, state and local laws, regulations and ordinances; (c) upon
Lessor's request, provide suitable storage, acceptable to Lessor, for the
Equipment for a period not to exceed 180 days from the date of return; (d)
cooperate with Lessor in attempting to remarket the Equipment, including display
and demonstration of the Equipment to prospective purchasers or lessees, and
allowing Lessor to conduct any private or public sale or auction of the
Equipment on Lessee's premises. All costs (except for any costs that may be
incurred in preparing the utilities or infrastructure necessary for operating
the Equipment at the return location) shall be the sole responsibility of the
Lessee. During any period of time from the expiration or earlier termination of
the Lease until the Equipment is returned in accordance with the provisions
hereof or until Lessor has been paid the applicable purchase option price if any
applicable purchase option is exercised, Lessee agrees to pay to Lessor
additional per diem rent ("Holdover Rent"), payable promptly on demand in an
amount equal to 125% of the highest monthly Rental Payment payable during the
Lease Term divided by 30, provided, however, that nothing contained herein and
no payment of Holdover Rent hereunder shall relieve Lessee of its obligation to
return the Equipment upon the expiration or earlier termination of the Lease.
19. MISCELLANEOUS
THE LEASE REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES CONCERNING THE
LEASE OF THE EQUIPMENT AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. LESSEE
ACKNOWLEDGES AND CERTIFIES THAT NO SUCH ORAL AGREEMENTS EXIST. The Lease may not
be amended, nor may any rights under the Lease be waived, except by an
instrument in writing signed by the party charged with such amendment or waiver.
The term "Lessee" as used in the Lease shall mean and include any and all
Lessees who sign below, each of whom shall be jointly and severally liable under
the Lease. This Master Lease will not be binding on Lessor until accepted and
executed by Lessor, notice of which is hereby waived by Lessee. Any waiver of
the terms hereof shall be effective only in the specific instance and for the
specific purpose given. Time is of the essence in the payment and performance of
all of Lessee's obligations under the Lease. The captions in this Lease are for
convenience only and shall not define or limit any of the terms hereof.
20. ENFORCEABILITY AND GOVERNING LAW
Any provisions of this Lease which are unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
unenforceability without invalidating the remaining provisions hereof, and any
such unenforceability in any jurisdiction shall not render unenforceable such
provisions in any other jurisdiction. To the extent permitted by applicable law,
Lessee hereby waives; (a) any provisions of law which render any provision
hereof unenforceable in any respect; (b) all rights and remedies under Rhode
Island General Laws Sections 6A-2.1-508 through 522 or corresponding provisions
of the Uniform Commercial Code article or division pertaining to personal
property leasing in any jurisdiction in which enforcement of this Lease is
sought.
THIS LEASE AND THE LEGAL RELATIONS OF THE PARTIES HERETO SHALL IN ALL
RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF RHODE ISLAND, WITHOUT REGARD TO PRINCIPLES REGARDING THE CHOICE OF LAW.
LESSEE HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF THE COURTS OF THE
STATE OF RHODE ISLAND AND CALIFORNIA AND THE FEDERAL DISTRICT COURT FOR THE
DISTRICT OF RHODE ISLAND AND THE NORTHERN DISTRICT OF CALIFORNIA FOR THE
PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF ITS OBLIGATIONS
HEREUNDER, AND EXPRESSLY WAIVES ANY OBJECTIONS THAT IT MAY HAVE TO THE VENUE OF
SUCH COURTS. LESSEE HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY
ACTION BROUGHT ON OR WITH RESPECT TO THIS LEASE. Any action by Lessee against
Lessor for any cause of action relating to this Lease shall be brought within
one year after any such cause of action first arises.
Executed and delivered by duly authorized representatives of the parties hereto
as of the date set forth below.
DATED AS OF: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
Name: John J. Gould Name: Michael B. Sullivan
Title: Vice President Title: President
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ADDITIONAL SECURITY AGREEMENT
SECURED PARTY: FLEET CAPITAL CORPORATION DEBTOR: FLEX PRODUCTS, INC.
50 Kennedy Plaza 1402 Mariner Way
Providence, Rhode Island 02903-2305 Santa Rosa, CA 95407
1. Grant of Security Interest. The undersigned Debtor hereby grants
to Secured Party and its successors and assigns, a continuing security interest
in the Collateral (hereinafter defined) to secure the due and punctual payment
and performance of all of the Obligations (hereinafter defined) to an amount not
to exceed $5,000,000. As used herein, the term "Obligations" shall mean and
include the following: (a) all of Debtor's obligations under that certain Master
Equipment Lease Agreement No. 32089 dated as of June 19, 1996, to Secured Party
(the "Agreement"); and (b) all obligations contained herein and. As used herein,
the term "Collateral" shall mean and include the property described on the
Additional Collateral Schedule attached hereto, whether now owned or hereafter
acquired and wherever the same may be located, and all present and future
additions, attachments, or accessories thereto and replacements thereof, and the
proceeds therefrom or thereof, including proceeds in the form of goods,
accounts, chattel paper, documents, instruments and general intangibles,
insurance proceeds payable in respect of loss or damage to any such property.
All capitalized terms used herein and not defined herein shall have the meanings
set forth or referred to in the Agreement. To the extent not otherwise defined
in this Additional Security Agreement, all other terms contained in this
Additional Security Agreement shall have the meanings assigned or referred to
them in the Uniform Commercial Code in force in the State of Rhode Island (the
"UCC").
2. Additional Documents and Aqreements. Debtor will, at the request
of Secured Party, execute, deliver, and permit Secured Party to file and record
any financing statement, specific assignment or other paper that may be
reasonably requested by Secured Party in order to create, preserve, perfect or
validate any security interest hereunder or to enable Secured Party to exercise
and enforce its rights hereunder with respect to any of the Collateral, Debtor
hereby appoints Secured Party as Debtor's attorney-in-fact to execute, sign and
file such additional financing statements as Secured Party may determine in its
sole discretion to be necessary or desirable to protect Secured Party's interest
in the Collateral. Debtor hereby authorizes Secured Party to file and record any
carbon, photographic or other reproduction of this Additional Security Agreement
or any financing statement executed and delivered in connection with this
Additional Security Agreement, which shall for all purposes be deemed to be
sufficient as a financing statement hereunder. The security interest granted
hereby shall continue effective irrespective of any retaking and redelivery of
Collateral to Debtor until all Obligations secured hereby are fully paid or
performed. The Collateral is and shall remain personal property even though all
or any portion of the Collateral may hereafter become attached or affixed to
real property, and Debtor shall provide Secured Party with disclaimers and
waivers from landlords, mortgagees or any other persons holding any interest in
the real property where any Collateral may be located, acceptable in all
respects to Secured Party, which may be necessary or advisable in the sole
discretion of Secured Party to confirm that the security interest and rights of
Secured Party in the Collateral are and will remain valid against all other
Parties.
3. Representations; Warranties; Covenants and Aqreements. For so
long as any Obligations shall remain outstanding, Debtor hereby represents,
warrants, covenants and agrees that: (a) this Additional Security Agreement and
all related documentation has been and shall be duly authorized by all necessary
action on the part of Debtor consistent with its form of organization, do not
and shall not require any further shareholder or partner approval, or require
the approval of, or the giving of notice to, any federal, state, local or
foreign governmental authority and shall not contravene any law binding on
Debtor or contravene any certificate or articles of incorporation or by-laws or
partnership certificate or agreement, or any agreement, indenture, or other
instrument to which Debtor is a party or by which it may be bound; (b) Debtor
shall lawfully possess and own the Collateral; (c) except for the security
interest granted hereby, the Collateral is free from and will be kept free from
all liens, claims, security interests, attachments and encumbrances, and that no
financing statement covering the Collateral or any proceeds thereof shall be on
file in favor of anyone other than Secured Party; (d) Debtor will not misuse,
fail to keep in good repair, sell, assign, rent, lend, encumber, transfer,
secrete or otherwise dispose of any of the Collateral or any interest therein,
nor permit or contract to do any such act, except that Debtor may dispose of
inventory in the ordinary course of business as heretofore conducted by Debtor;
(e) if any Collateral becomes the subject of any instrument, chattel paper,
negotiable document of title, including any warehouse receipt or bill of lading,
Debtor shall deliver such instrument, paper or document to Secured Party; (f)
Debtor shall defend at Debtor's own cost any action, proceeding or claim
affecting the Collateral; (g) Debtor shall pay promptly all taxes, assessments,
license fees and other public or private charges when levied or assessed against
the Collateral; (h) Debtor shall permit Secured Party at any time during normal
business hours to examine and inspect the Collateral and to inspect and make
abstracts from records of Debtor concerning the Collateral; (i) Debtor shall
furnish Secured Party such information and reports regarding the status,
condition and location of the Collateral and the financial condition of Debtor
as Secured Party may from time to time reasonably request; (j) if a certificate
of title be required or permitted by law with respect to any Collateral, Debtor
shall obtain such certificate and all related lien registration and notation
documentation with respect to the Collateral indicating the security interest of
Secured Party thereon, and in any event do everything necessary or expedient to
preserve or perfect the security interest of Secured Party in such Collateral;
(k) Debtor shall promptly notify Secured Party of any event causing a
substantial loss or diminution in the value or functional utility of all or any
material part of the Collateral, or affecting Secured Party's rights or remedies
hereunder with respect to the disposition of all or any material part of the
Collateral; (1) Debtor shall promptly and diligently collect all accounts and
rights to receive payment for goods sold or leased, or for services rendered
(whether or not evidenced by an instrument or chattel paper) which constitute
all or any part of the Collateral ("Accounts") and maintain accurate books and
records of such Accounts and all collections thereof; and (m) Debtor shall keep
its records concerning the Accounts at Debtor's chief executive offices at the
address shown above, or at such other address as Secured Party shall approve in
writing. For so long as any Obligations shall remain outstanding, Debtor shall:
(i) segregate all collections, Accounts and proceeds of the Collateral so that
they are capable of identification and deliver such collections, Accounts and
proceeds to Secured Party immediately upon demand therefor; (ii) obtain Secured
Party's prior written consent to any sale, contract of sale or other disposition
of the Collateral; (iii) upon Secured Party's request therefor, notify account
debtors, purchasers of the Collateral or any other persons of the security
interest created hereby; and (iv) upon Secured Party's request therefor, demand
and collect any Accounts and any proceeds of the Collateral from persons owing
same. Debtor hereby irrevocably authorizes Secured Party to endorse Debtor's
name on all collections, receipts, instruments or other documents, and appoints
Secured Party as Debtor's attorney-in-fact to exercise to the extent permitted
by law all powers, rights and remedies necessary to enable Secured Party to
exercise its rights hereunder.
4. Insurance. All risk of loss of, damage to, or destruction of,
the Collateral shall at all times be with Debtor. Debtor will procure forthwith
and maintain fire, theft and property damage insurance with extended or combined
additional coverage on any Collateral which is tangible personal property for
the full replacement value thereof for so long as any Obligations remain
outstanding, together with such other insurance as Secured Party may reasonably
specify, and promptly deliver certificates and copies evidencing each policy to
Secured Party with a standard mortgagee's long form endorsement attached showing
loss payable to Secured Party and Debtor as their respective interests may
appear, which endorsement shall provide at least thirty (30) days' prior written
notice to Secured Party of any material change, cancellation or non-renewal of
coverage. Secured Party's acceptance of policies in lesser amounts or risks
shall not be a waiver of Debtor's foregoing obligations.
5. Defaults. Time is of the essence in the payment and performance
of all Obligations, including without limitation all Obligations under or in
respect of this Additional Security Agreement. It shall be an "Event of Default"
hereunder if (i) an Event of Default under the Agreement shall occur, (ii)
Debtor breaches any representation, warranty, covenant or provision hereof, and
such breach continues for ten (1O) days after notice thereof to Debtor,
Page 1 of 2
<PAGE>
provided, however, that no such breach shall constitute an Event of Default
hereunder where Debtor has commenced curing such breach within such ten (1O) day
period and continues to diligently pursue such cure in the opinion of Secured
Party; or (iii) any Collateral is lost or destroyed.
6. Remedies. Upon the occurrence of an Event of Default hereunder.
all Obligations, at Secured Party's option and without notice, shall become
immediately due and payable, and Secured Party shall have all rights and
remedies of a secured party under the UCC and any other applicable law, and in
addition, and without limiting the foregoing, Secured Party may: (a) sell all or
any part of the Collateral at public or private sale at such price(s) as Secured
Party may deem satisfactory; (b) require Debtor to assemble all or any part of
the Collateral and any records pertaining thereto and make it available to the
Secured Party at a place to be designated by the Secured Party; (c) enter the
premises of Debtor and take possession of the Collateral and any records
pertaining thereto and/or disable or render any such Collateral unusable; (d)
grant extensions, compromise claims and settle Accounts in any amount for less
than face value or book value or otherwise without prior notice to Debtor. All
rights and remedies in this Additional Security Agreement are cumulative and not
alternative and are not exclusive of any other remedies provided by law. Debtor
will upon demand pay to Secured Party the expenses of retaking, holding,
preparing for sale, selling and the like, including without limitation,
reasonable attorney's fees and other legal expenses, incurred by Secured Party
in connection with the Collateral or the exercise of its rights or remedies
hereunder, all of which shall constitute additional Obligations secured by the
Collateral hereunder. In the event Secured Party seeks to take possession of any
or all of the Collateral by court process, Debtor hereby irrevocably waives any
bonds and any surety or security relating thereto required by any statute, court
rule or otherwise as an incident to such possession, and waives any demand for
possession prior to the commencement of any suit or action to recover with
respect thereto. Any notice required to be given by Secured Party of a sale or
other disposition or other intended action by Secured Party with respect to any
of the Collateral or otherwise which is made in accordance with the terms of
this Additional Security Agreement at least five (5) days prior to such proposed
action, shall constitute fair and reasonable notice to Debtor of any such
action. Secured Party shall be liable to Debtor only for its gross negligence or
willful misconduct in failing to comply with any applicable law imposing duties
upon Secured Party; Secured Party's liability for any such failure shall be
limited to the actual loss suffered by Debtor directly resulting from such
failure. Secured Party shall have no liability to Debtor in tort or for
incidental or consequential damages.
7. Assignment. The provisions of this Additional Security Agreement
shall be binding upon and shall inure to the benefit of the heirs,
administrators, successors and assigns of Secured Party and Debtor, provided,
however, that Debtor may not assign any of its rights or delegate any of its
Obligations hereunder without the prior written consent of Secured Party.
Secured Party may, from time to time, without notice to Debtor, sell, assign,
transfer, participate, pledge or otherwise dispose of all or any part of the
Obligations and/or the Collateral therefor. In such event, each and every
immediate and successive purchaser, assignee, transferee, participant, pledgee,
or holder of all or any part of the Obligations and/or the Collateral (each, a
"Holder") shall have the right to enforce this Additional Security Agreement, by
legal action or otherwise, for its own benefit as fully as if such Holder were
herein by name specifically given such rights hereunder. Debtor agrees that the
rights of any such Holder hereunder or with respect to the related Obligations
shall not be subject to any defense, set-off or counterclaim that Debtor may
assess or claim against Secured Party, and that any such Holder shall have all
of the Secured Party's rights hereunder but none of the Secured Party's
obligations. Secured Party shall have an unimpaired right to enforce this
Additional Security Agreement for its benefit with respect to that portion of
the Obligations which Secured Party has not sold, assigned, transferred,
participated, pledged or otherwise disposed of.
8. Miscellaneous. No failure on the part of Secured Party to
exercise and no delay in exercising any right, power or remedy hereunder shall
operate as a waiver thereof. Any provisions hereof contrary to, prohibited by or
invalid under applicable laws or regulations shall be inapplicable and deemed
omitted here from, and shall not invalidate the remaining provisions hereof.
Debtor acknowledges receipt of a true copy and waives acceptance hereof. THIS
ADDITIONAL SECURITY AGREEMENT TOGETHER WITH THE AGREEMENT AND THE DOCUMENTS
EXECUTED IN CONNECTION THEREWITH CONSTITUTES THE ENTIRE AGREEMENT OF DEBTOR AND
SECURED PARTY RELATIVE TO THE SUBJECT MATTER HEREOF, AND THERE ARE NO PRIOR OR
CONTEMPORANEOUS UNDERSTANDINGS OR AGREEMENTS, WHETHER ORAL OR IN WRITING,
BETWEEN THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF. NEITHER
THIS ADDITIONAL SECURITY AGREEMENT NOR ANY PROVISION HEREOF MAY BE CHANGED,
WAIVED, DISCHARGED OR TERMINATED EXCEPT BY AGREEMENT IN WRITING SIGNED BY THE
PARTY AGAINST WHICH ENFORCEMENT OF SUCH CHANGE, WAIVER, DISCHARGE OR TERMINATION
IS SOUGHT. Any notices and demands shall be in writing and sent to the parties
by regular mail at the addresses herein set forth or to such other address as
the parties may hereafter specify by written notice. THIS ADDITIONAL SECURITY
AGREEMENT AND THE LEGAL RELATIONS OF THE PARTIES HERETO SHALL IN ALL RESPECTS BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF RHODE
ISLAND, WITHOUT REGARD TO PRINCIPLES REGARDING THE CHOICE OF LAW. DEBTOR HEREBY
CONSENTS TO THE JURISDICTION OF THE COURTS OF THE STATE OF RHODE ISLAND AND
CALIFORNIA, AND THE FEDERAL DISTRICT COURT FOR THE DISTRICT OF RHODE ISLAND AND
THE NORTHERN DISTRICT OF CALIFORNIA FOR THE PURPOSES OF ANY SUIT, ACTION OR
OTHER PROCEEDING ARISING OUT OF ITS OBLIGATIONS HEREUNDER AND EXPRESSLY WAIVES
ANY OBJECTIONS TO THE VENUE OF SUCH COURTS. DEBTOR HEREBY EXPRESSLY WAIVES TRIAL
BY JURY IN ANY ACT1ON BROUGHT ON OR WITH RESPECT TO THIS ADDITIONAL SECURITY
AGREEMENT. Any action by Debtor against Secured Party for any cause of action
relating to this Additional Security Agreement shall be instituted within one
year after any such cause of action first arise.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
Name: John J. Gould Name: Michael B. Sullivan
Title: Vice President Title: President
Page 2 of 2
<PAGE>
FLEET CAPITAL CORPORATION PAGE 1 OF 3
ADDITIONAL COLLATERAL SCHEDULE
Attached to and made part of the following documents: Additional Security
Agreement dated as of: June 19, 1996 and UCC Financing Statement(s) with Flex
Products, Inc.
The Equipment is currently located at: 2793 Northpoint Parkway
Santa Rosa, California 95407
BETA ONE
Unit Number: Beta I
(1) Leybold Hereaus electron beam roll coater, model Al600B30, Mfg. 1979, 52"
width capacity, 3 meters per second, 480 volt, 3 phase, 122 Amps., Serial Number
31419342, which machine includes, but is not limited to, the following:
(12) 30KW electron beam guns with power supplies, model D2D4
(3) Polycolds, model PFC1PFC00ST
(6) Diffusion pumps, 20" water cooled
(12) Electron gun controllers
Winding Cabinet
(12) Hewlett Packard 6253A dual DC power supplies, 0-200 volt, 3 amps
(5) Leybold Hereaus vacuum motors, model PENNINGVAC PM 41152
(4) Leybold Hereaus vacuum motors, model THERMOVPC TM 22052
Viewing port holes
Residual gas analyzers electron monitoring system, model QUADREX 200
Meters
Control Cabinets
Catwalk and platform around machine
Hi-resolution RAD monitoring system
Winding shafts and chucks
Sputtering power supply
63 X 15 Target
Web drives
Plate lifter
(6) Leybold Hereaus turbo pumps, model 1000C
(4) Stokes vacuum pumps, model 412-11
(2) Leybold Hereaus blowers, model RA7001S
(4) Genvin portable oil filters
Glow power supply
(6) Filter amplifier chassis
(2) Water cooled shield sets
Sputtering targets
Desktop computer
Monitors with exception of proprietary plasma emission and optical monitor
Pressure controllers
Heco-Pacific crane
<PAGE>
PAGE 2 OF 3
ADDITIONAL COLLATERAL SCHEDULE
BETA TWO
Unit Number: Beta II
(l) Leybold Hereaus sputtering roll coater, Mfg. 1987, 54" width capacity,
overall size approximately 16' X 12' X 12', 480 volt, 3 phase, Serial Number
58073044, which machine includes, but is not limited to, the following:
(2) polycolds, model PFC65011ST
(8) 8 X 54 sputtering targets with (8) SSV sputtering power supplies, serial
numbers are MCC3K1-2, MCC3K3-4, MCC3I1-2, MCC3I3-4, MCC3G1-2, MCC3G3-4,
MCC3F1-2, MCC3F3-4
(2) Cryo-pumps
Neslab chiller, model RTE-110
(8) 90 Kilowatt breaker boxes
(8) Systron Donner 0-60 VDC, 0-100 amp. power supplies
(21) Leybold Hereaus turbo pumps, model 1000G
(2) Leybold Hereaus blower station, model WAV2000
(3) Leybold Hereaus pumps, model S250-C
Leybold Hereaus blower, model RUVAC, type WPV 251
(2) Balston filters, model R1680
Leybold Hereaus blower, model RUVAC, type 70001S
Cooling Tower
(4) Anode power supplies
(4) Glow discharge power supplies
Allen Bradley controls, PLC-30
Herbert Schuller chilling system with tower
(4) Optical monitoring devices
Transformers
Motor controls
Sheet resistance monitor
Safety platform with stairs
(2) Target backing plates
(2) Analog controllers
(2) 50/50 tooling
Turbo lifting fixture
(43) sets of shields
Gas handling system
Cathode system
Overhead trolley with crane
(7) Spare Titanium targets
(5) Zircon targets
(6) Long shields
<PAGE>
PAGE 3 OF 3
ADDITIONAL COLLATERAL SCHEDULE
The Equipment is Currenty Located at: 1402 Mariner Way
Santa Rosa, California 95407
BETA THREE
(2) Bell & Gossett pumps, models 11RC925 series 1510, serial numbers 1955297
and 1955296 Raven polypro tank, approximately 5' X 2' diameter
Raven polypro tank, approximately 5' X 2' diameter
(2) Bell & Gossett pumps, models 4BC9375, serial numbers 1957959 and 1957960,
625 GPM
Alfa laval heat exchanger, type M6-FG, serial number 3010286368 with (4)
0-150 degree gauges
Alfa laval heat exchanger, type MIO-BFG, serial number 3010286389 with (4)
0-150 degree gauges
FSI water filter, model FSP-40N-30455, Mfg. 1995, 10 micron with 0-160 PSI
gauge
Dual water cooling condensing system, low pressure, high pressure with (2)
KSB pumps, model ETACHROMB, valves, so1enoids
(2) Edwards two stage vacuum pumps, model 275
Air storage tank 4' X 2' diameter with 0-160 PSI guage
Water filter system with (2) KSB ETACHROM-B-40160562, pumps, 2200 gallon
round stainless steel tank, model BT33541
Approximately 60' X 4" stainless steel piping with fittings
Approximately 100' X 2" stainless steel piping with fittings
BETA FIVE
WPH overhead wire rope crane, model 1 l/2 ton, serial number W6022015,
approximately X-Y, travel is 55' X 35' X 40'
Kinney vacuum rotary pump, model KT-505-LP, serial number 3011-2 with a
dresser roots booster blower, 15HP, model HV3000, serial number H00224, 480
volts
Kinney vacuum rotary pump, model KT-505-LP, serial number 3011-1 with a
dresser roots booster blower, 15HP, model HV3000, serial number H00219
Dresser roots, 30MP booster pump
(4) Emergency isolation switches
(3) 5.5 Bar pneumatic actuator valves
Solenoids
Alfa laval heat exchanger, Mfg. 1995, serial number 3010286367
(4) Weksler temperature gauges, 0-150 degrees Fahrenheit
Raven round polypro storage tank, approximately 6' X 4' diameter, serial
number G333465
Approximately 60 feet of 4" 304 stainless steel seamless piping with
connectors
(2) ITT Bell & Gossett pumps, series 1510, 20 HP, 200 GPM, model
21/2AB7000BF, serial numbers 1955295 and 1955296
(2) FSI filter columns, stainless steel, Mfg. 1995, 10 micron filters, serial
numbers 38121, 150 PSI
Air storage tank 4' X 2' diameter with a 0-160 PSI gauge
Miscellaneous spare parts
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
BY: /s/ John J. Gould BY: /s/ Michael B. Sullivan
-------------------------------- --------------------------------
NAME: John J. Gould NAME: Michael B. Sullivan
------------------------------ ------------------------------
TITLE: Vice President TITLE: President
----------------------------- -----------------------------
<PAGE>
[LOGO] Fleet LEASE SCHEDULE NO. 32089-00001
Capital Leasing (True Lease Schedule)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
Lessee: FLEX PRODUCTS, INC.
Address: 1402 MARINER WAY
SANTA ROSA, CA 95407
1. This Lease Schedule No. 32089 - 00001 dated as of June 19, 1996 is
entered into pursuant to and incorporates by this reference, all of the terms
and provisions of that certain Master Equipment Lease Agreement No. 32089 dated
as of JUNE 19, 1996 (the "Master Lease"), for the lease of the Equipment
described in Schedule A attached hereto. This Lease Schedule shall constitute a
separate, distinct and independent lease of the Equipment and the contractual
obligation of Lessee. References to the "the Lease" or "this Lease" shall mean
and refer to this Lease Schedule, together with the Master Lease and all
exhibits, addenda, schedules, certificates, riders and other documents and
instruments executed and delivered in connection with this Lease Schedule, all
as the same may be amended or modified from time to time. All capitalized terms
used herein and not defined herein shall have the meanings set forth or
referred to in the Master Lease. By its execution and delivery of this Lease
Schedule, Lessee hereby reaffirms all of the representations, warranties and
covenants contained in the Master Lease, as of the date hereof, and further
represents and warrants to Lessor that no Event of Default, and no event or
condition which with notice or the passage of time or both would constitute an
Event of Default, has occurred and is continuing as of the date hereof.
2. ACQUISITION COST. The Acquisition Cost of the Equipment is:
$7,879,000.00.
3. (a) LEASE TERM. The Lease Term shall commence on the date hereof and
shall continue for a period of 72 months after the Lease Term Commencement Date
set forth in the Acceptance Certificate to this Lease Schedule, plus any renewal
or extended term applicable in accordance with the terms of the Lease.
(b) RENTAL PAYMENTS. In addition to interim rent payable pursuant
to Section 2 of the Master Lease, Lessee shall pay Lessor 72 consecutive Rental
Payments in the amounts set forth in the schedule below, plus any applicable
sales/use taxes, commencing on the Rental Payment Commencement Date set forth
in the Acceptance Certificate and MONTHLY thereafter for the remaining Lease
Term. Each Rental Payment shall be payable on the same day of the month as the
Rental Payment Date in each succeeding rental period during the remaining Lease
Term (each, a "Rental Payment Date"):
Amount of Each
Number of Rental Payments Rental Payment
------------------------- --------------
12 113,999.91
60 129,180.78
(c) ADVANCE RENTAL PAYMENT. Lessee agrees to pay Lessor the first
01 and last O Rental Payments, due and payable on the Acceptance Date.
<PAGE>
ACCEPTANCE CERTIFICATE
[LOGO] Fleet
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Acceptance Certificate (this "Acceptance Certificate") is attached
to and made a part of that certain Lease Schedule No. 32089 - 00001, dated as of
June 19, 1996 (the "Lease Schedule"), by and between the undersigned parties.
All capitalized terms used herein and not defined herein shall have the meanings
set forth or referred to in the Lease Schedule. To the extent the terms set
forth in this Acceptance Certificate differ or conflict with any of the terms
set forth in the Lease, the terms set forth in this Acceptance Certificate shall
control.
1. Lessee acknowledges and agrees that each item of Equipment set forth
on Schedule A hereto (collectively, the "Equipment") is hereby unconditionally
accepted by Lessee for all purposes under the Lease at the locations specified
in Schedule A-1 hereto, and hereby agrees to faithfully perform all of its
obligations under the Lease as of the date hereof (the "Acceptance Date").
Lessee hereby authorizes and directs Lessor to make payment to each vendor of
the Equipment pursuant to such vendor's invoice or any purchase order, purchase
agreement or supply contract with such vendor, receipt and approval of which are
hereby reaffirmed by Lessee.
2. By its execution and delivery of this Acceptance Certificate, Lessee
hereby reaffirms all of the representations, warranties and covenants contained
in the Lease as of the date hereof, and further represents and warrants to
Lessor that no Event of Default, and no event or condition which with notice or
the passage of time or both would constitute an Event of Default, has occurred
and is continuing as of the date hereof. Lessee further certifies to Lessor that
Lessee has selected the Equipment and has received and approved the purchase
order, purchase agreement or supply contract under which the Equipment will be
acquired for all purposes of the Lease.
3. Lessee hereby represents and warrants that: (a) the Equipment has been
delivered and is in an operating condition and performing the operation for
which it is intended to the satisfaction of the Lessee; and (b) if requested by
Lessor, the Equipment has been marked or labeled evidencing the Lessor's
interest therein.
4. The LEASE TERM COMMENCEMENT DATE is the 10th day of July, 1996
5. The RENTAL PAYMENT COMMENCEMENT DATE is the 10th day of July, 1996
6. All terms and provisions of the Lease Schedule shall remain in full force and
effect, except as otherwise provided below:
- ACQUISITION COST: $7,879,000.00.
- LEASE TERM: (72) seventy-two months.
- RENTAL PAYMENTS: Number of Rental Payments Rental Payment Amount
12 $_________
60 $_________
- ADVANCE RENTAL PAYMENT(S): First 01 and last 00.
- SECURITY DEPOSIT: N/A %.
Dated: July 10, 1996
Agreed and Accepted:
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
---------------------------- ---------------------------
Name: John J. Gould Name: Michael B. Sullivan
-------------------------- -------------------------
Title: VP/Senior Lender Title: President
-------------------------- -------------------------
<PAGE>
[LOGO] Fleet PAY PROCEEDS LETTER
Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
We hereby authorize you to pay the following Payee(s) from the proceeds of
your financial accommodations to us in respect of that certain True Lease
Schedule No. 32089-00001 dated as of June 19, 1995, and make disbursements
directly to said Payee(s) as follows:
Amount of
PAYEE Payment
Flex Products, Inc. $ 7,765,000.09
- ---------------------------------------------------- -------------------------
Fleet Capital Corporation (short fund to pay 113,999.91
- ---------------------------------------------------- -------------------------
Customer Invoice now due)
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
TOTAL: $ 7,879,000.00
-------------------------
Dated as of: June 19, 1996
-----------------
FLEX PRODUCTS, INC.
By: /s/ Michael B. Sullivan
---------------------------
Name: Michael B. Sullivan
-------------------------
Title: President & CEO
-------------------------
<PAGE>
FLEET CAPITAL CORPORATION PAGE 1 OF 1
SCHEDULE A EQUIPMENT
Attached to and made part of the following documents: True Lease Schedule No.
32089-01, Acceptance Certificate, UCC Financing Statement(s), and Warranty Bill
of Sale with Flex Products, Inc.
The Depreciable Life of the Property is (07) seven years.
LOC# (01)
BETA THREE
Unit Number: Beta III
(1) Weinert Vacuum GMBH, sputtering roll coating machine, Mfg. 1995, 7' X 10'
chamber size, 480 volt, 3 phase, all stainless stee1 construction Serial Number
FBR 1400 SP-SC-001, which machine includes, but is not limited to, the
following:
(6) 20" diffusion pumps
(4) 16" diffusion pumps
3 Chamber system
Liebert UPS battery back-up system, model AP441, serial number P21174SE
(3) Polycoid cooling systems, model PFC-1100ST
(3) Cathodes
(2) Aluminum evaporation systems
(6) Transformers, 72 kilowatt
Edwards two stage vacuum pump, model 275
(3) Edwards two stage vacuumm pumps, model 8O
(3) ENI D.C. Plasma generators, model DCG-100 zokw/ea
Siemens PLC
(1) Nemonic Display
(2) Control Stations
(1) PLC
(2) Machine state actuators
Circulation pumps
Hydraulic pumps
AND ALL STANDARD AND ACCESSORY EQUIPMENT
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
BY: /s/ John J. Gould BY: /s/ Michael B. Sullivan
---------------------------- ---------------------------
NAME: John J. Gould NAME: Michael B. Sullivan
-------------------------- -------------------------
TITLE: VP/Senior Lender TITLE: President
-------------------------- -------------------------
<PAGE>
FLEET CAPITAL CORPORATION Schedule A-1
Equipment Location
Attached to and made part of the following documents True Lease Schedule No.
32089-01, Acceptance Certificate, UCC Financing Statement(s), Warranty Bill of
Sale with Flex Products, Inc.
- --------------------------------------------------------------------------------
Loc # Equipment Currently Located at:
- --------------------------------------------------------------------------------
01 1402 Mariner Way, Santa Rosa, California 95407
- --------------------------------------------------------------------------------
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
[LOGO] Fleet STIPULATED LOSS VALUE SCHEDULE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Stipulated Loss Value Schedule (this "Schedule") is attached to
and made a part of that certain Lease Schedule No. 32089-00001, dated as of June
19, 1996 (the "Lease Schedule"), by and between the undersigned parties.
<TABLE>
The following Stipulated Loss Values shall be used to calculate damages
or loss as provided in the Master Lease. The Stipulated Loss Value with respect
to any item of Equipment on any Rental Payment Date during the Lease Term shall
be an amount equal to the sum of: (a) all Rental Payments and other amounts then
due and owing to Lessor under the Lease, together with all accrued interest and
late charges thereon, calculated through and including the date of payment; plus
(b) the product of the Acquisition Cost of the such Equipment multiplied by the
percentage set forth below as of such Rental Payment Date.
<CAPTION>
<S> <C> <C> <C>
Rental Payment Date for Percentage of Rental Payment Date for Percentage of
Rental Payment Number Acquisition Cost Rental Payment Number Acquisition Cost
</TABLE>
SEE EXHIBIT C ATTACHED HERETO AND MADE A PART HEREOF
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
EXHIBIT C
TO
STIPULATED LOSS VALUE SCHEDULE
TO LEASE SCHEDULE NO. 32089-01
RENTAL PAYMENT PERCENTAGE OF RENTAL PAYMENT PERCENTAGE OF
DATE FOR RENTAL ACQUISITION COST DATE FOR RENTAL ACQUISITION COST
PAYMENT NUMBER PAYMENT NUMBER
37 70.90880090
1 103.35121715 38 69.75511355
2 102.77715752 39 68.59002020
3 102.19526265 40 67.41874422
4 101.59552206 41 66.23597391
5 100.98781724 42 65.04165152
6 100.37210821 43 63.84099969
7 99.73838360 44 62.62870597
8 99.09652408 45 61.40471189
9 98.44648879 46 60.16895869
10 97.78823666 47 58.92972240
11 97.11575495 48 57.67865042
12 96.43494366
49 56.42401842
13 95.54711438 50 55.15747340
14 94.34921445 51 53.87895553
15 93.74119331 52 52.59673978
16 92.81702863 53 51.30247247
17 91.88261080 54 49.99609306
18 90.93788832 55 48.68587582
19 89.97683797 56 47.36346638
20 89.00534921 57 46.02880349
21 88.02336959 58 44.68182560
22 87.03084644 59 43.33120369
23 86.02873119 60 41.96818663
24 85.01597126
61 40.60144498
25 83.99351758 62 39.22222721
26 82.96031708 63 37.83047065
27 81.91631576 64 36.43484516
28 80.86246378 65 35.02659847
29 79.79770726 66 33.60566720
30 78.72199142 67 32.18072044
31 77.63626563 68 30.74300521
32 76.53947521 69 29.29245738
33 75.43156457 70 27.82901249
34 74.31247787 71 26.37095856
35 73.18743961 72 24.89996987
36 72.05113926
72 25.00000000
<PAGE>
[LOGO] Fleet PURCHASE OPTION RIDER
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (this "Rider") is attached to and made a
part of that certain Lease Schedule No. 32089-00001, dated as of June 19, 1996
(the "Lease Schedule"), by and between the undersigned parties.
If no Event of Default (or event or condition which, with the passage
of time or giving of notice, or both, would become such an Event of Default)
shall have occurred and be continuing, and the Lease shall not have been earlier
terminated, Lessee shall have the option to purchase (the "Purchase Option")
all, but not less than all, of the Equipment at the expiration of the Lease Term
for an amount, payable in immediately available funds on the last day of the
Lease Term, equal to: (a) all Rental Payments, late charges and other amounts
due and owing under the Lease; plus (b) all taxes, assessments and other charges
due or payable in connection with the sale of the Equipment to Lessee; plus (c)
an amount equal to 25.00000% of the Acquisition Cost of the Equipment, which
Lessor and Lessee acknowledge represents a reasonable current estimate of the
fair market value of the Equipment at the end of the Lease Term.
Provided that Lessor shall have received all amounts payable hereunder
on the last day of the Lease Term, and that no Event of Default then exists and
is continuing under the Lease, Lessor shall convey all of its right, title and
interest in and to the Equipment to Lessee on the last day of the Lease Term, on
an "AS-IS," "WHERE-IS" BASIS WITHOUT REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, and without recourse to Lessor, except that the Equipment shall be free
and clear of all liens created by Lessor. If Lessee intends to exercise the
Purchase Option, Lessee shall give irrevocable written notice to Lessor (the
"Option Notice") not more than 240 days, nor less than 180 days, prior to the
expiration of the Lease Term. If Lessee fails to give such written notice to
Lessor, it shall be conclusively presumed that Lessee has elected not to
exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 5.0 % of the Acquisition Cost of the
Equipment.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
[LOGO] Fleet WARRANTY BILL OF SALE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903
FLEX PRODUCTS, INC., ("Seller") of 1402 MARINER WAY SANTA ROSA, CA
95407, in consideration of the sum of $7,879,000.00 Dollars, and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, does hereby sell, transfer and assign to Fleet Capital Corporation
("FCC") a Rhode Island corporation having its principal office at 50 Kennedy
Plaza, Providence, Rhode Island 02903, the equipment set forth in Schedule A
hereto (the "Equipment").
Seller hereby covenants with and warrants to FCC that Seller is the
lawful owner of the Equipment and has the right to sell the Equipment, and that
the Equipment is free and clear of all rights, claims, liens, charges, security
interests or encumbrances of any other person. Seller will forever indemnify,
defend and warrant all of the rights of FCC in and to the Equipment transferred
hereunder against the claims and demands of all other persons.
IN WITNESS WHEREOF, Seller has duly executed this Bill of Sale this 11th day of
July, 1996.
FLEX PRODUCTS, INC.
By: /s/ Michael B. Sullivan
--------------------------------
Name: Michael B. Sullivan
------------------------------
Title: President
-----------------------------
State of California
--------------------------
County of Sonoma
--------------------------
Subscribed and sworn before me this 11th day of July, 1996.
/s/ Aggie S. Navarro
Notary Public
My Commission expires:____________________
==============================
AGIE S. NAVARRO
[SEAL] COMM. #1009257
Notary Public--California
SONOMA COUNTY
My Comm. Expires NOV 11, 1997
==============================
<PAGE>
<TABLE>
<CAPTION>
This FINANCING STATEMENT is presented for filing and will remain effective with certain
exceptions for a period of five years from the date of filing pursuant to section 9403 of the
California Uniform Commercial Code.
- ------------------------------------------------------------------------------------------------
<C> <C>
1. DEBTOR (LAST NAME FIRST--IF AN INDIVIDUAL) 1A. SOCIAL SECURITY OR FEDERAL TAX NO.
Flex Products, Inc.
- ------------------------------------------------------------------------------------------------
1B. MAILING ADDRESS 1C. CITY, STATE 1D. ZIP CODE
2793 Northpoint Parkway Santa Rosa, California 95407
- ------------------------------------------------------------------------------------------------
2. ADDITIONAL DEBTOR (IF ANY) 2A. SOCIAL SECURITY OR FEDERAL TAX NO.
(LAST NAME FIRST--IF AN INDIVIDUAL)
- ------------------------------------------------------------------------------------------------
2B. MAILING ADDRESS 2C. CITY, STATE 2D. ZIP CODE
- ------------------------------------------------------------------------------------------------
3. DEBTOR'S TRADE NAMES OR STYLES (IF ANY) 3A. FEDERAL TAX NUMBER
================================================================================================
4. SECURED PARTY 4A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME Fleet Capital Corporation
MAILING ADDRESS 50 Kennedy Plaza, 5th Floor
CITY Providence STATE RI ZIP CODE 02903
- ------------------------------------------------------------------------------------------------
5. ASSIGNEE OF SECURED PARTY (IF ANY) 5A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME
MAILING ADDRESS
CITY
- ------------------------------------------------------------------------------------------------
6. This FINANCING STATEMENT covers the following types or items of property (include description
of real property on which located and owner of record when required by instruction 4).
(1) Leybold Hereaus electron beam roll coater, and (1) Leybold Hereaus sputtering roll coater
as further described on the Additional Collateral Schedule attached hereto and made a part
hereof.
32089-01/lae (additional collateral)
- ------------------------------------------------------------------------------------------------
7. CHECK [X] 7A. [ ] PRODUCTS OF COLLATERAL 7B. DEBTOR(S) SIGNATURE NOT REQUIRED IN
IF APPLICABLE ARE ALSO COVERED ACCORDANCE WITH INSTRUCTION 5(a) ITEM:
[ ](1) [ ](2) [ ](3) [ ](4)
- ------------------------------------------------------------------------------------------------
8. CHECK [X] [ ] DEBTOR IS A "TRANSMITTING UTILITY"
IF APPLICABLE IN ACCORDANCE WITH UCC SS. 9105 (1)(n)
- ------------------------------------------------------------------------------------------------
9. DATE: C 10. THIS SPACE FOR USE OF FILING OFFICER
O (DATE, TIME, FILE NUMBER
/s/ Michael B. Sullivan 7/11/96 D AND FILING OFFICER)
SIGNATURE(S) OF DEBTOR(S) E
- -------------------------------------------------- ---
Flex Products, Inc. 1
TYPE OR PRINT NAME(S) OF DEBTOR(S) 2
- --------------------------------------------------
3
/s/ John J. Gould
SIGNATURE(S) OF SECURED PARTY(IES) 4
- --------------------------------------------------
Fleet Capital Corporation 5
TYPE OR PRINT NAME(S) OF SECURED PARTY(IES) 6
==================================================
11. Return copy to: 7
NAME 8
ADDRESS
CITY 9
STATE
ZIP CODE 0
==================================================
FORM UCC.1--
Approved by the Secretary of State
==================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
This FINANCING STATEMENT is presented for filing and will remain effective with certain
exceptions for a period of five years from the date of filing pursuant to section 9403 of the
California Uniform Commercial Code.
- ------------------------------------------------------------------------------------------------
<C> <C>
1. DEBTOR (LAST NAME FIRST--IF AN INDIVIDUAL) 1A. SOCIAL SECURITY OR FEDERAL TAX NO.
Flex Products, Inc.
- ------------------------------------------------------------------------------------------------
1B. MAILING ADDRESS 1C. CITY, STATE 1D. ZIP CODE
2793 Northpoint Parkway Santa Rosa, California 95407
- ------------------------------------------------------------------------------------------------
2. ADDITIONAL DEBTOR (IF ANY) 2A. SOCIAL SECURITY OR FEDERAL TAX NO.
(LAST NAME FIRST--IF AN INDIVIDUAL)
- ------------------------------------------------------------------------------------------------
2B. MAILING ADDRESS 2C. CITY, STATE 2D. ZIP CODE
- ------------------------------------------------------------------------------------------------
3. DEBTOR'S TRADE NAMES OR STYLES (IF ANY) 3A. FEDERAL TAX NUMBER
================================================================================================
4. SECURED PARTY 4A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME Fleet Capital Corporation
MAILING ADDRESS 50 Kennedy Plaza, 5th Floor
CITY Providence STATE RI ZIP CODE 02903
- ------------------------------------------------------------------------------------------------
5. ASSIGNEE OF SECURED PARTY (IF ANY) 5A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME
MAILING ADDRESS
CITY
- ------------------------------------------------------------------------------------------------
6. This FINANCING STATEMENT covers the following types or items of property (include description
of real property on which located and owner of record when required by instruction 4).
(1) Weinert Vacuum GMBH, sputtering roll coating machine as further described on attached
Schedule A(s), and all additions, accessions, modifications, improvements, replacements,
substitutions, and accessories thereto and therefor, whether now owned or hereafter acquired,
and proceeds, products and income of any of the foregoing, including insurance proceeds.
Debtor has possession of the equipment under a true lease only. Secured Party has a security
interest in the equipment to the extent necessary to protect its title and interest therein.
Acct. No. 32089-01/lae
- ------------------------------------------------------------------------------------------------
7. CHECK [X] 7A. [ ] PRODUCTS OF COLLATERAL 7B. DEBTOR(S) SIGNATURE NOT REQUIRED IN
IF APPLICABLE ARE ALSO COVERED ACCORDANCE WITH INSTRUCTION 5(a) ITEM:
[ ](1) [ ](2) [ ](3) [ ](4)
- ------------------------------------------------------------------------------------------------
8. CHECK [X] [ ] DEBTOR IS A "TRANSMITTING UTILITY"
IF APPLICABLE IN ACCORDANCE WITH UCC SS. 9105 (1)(n)
- ------------------------------------------------------------------------------------------------
9. DATE: C 10. THIS SPACE FOR USE OF FILING OFFICER
O (DATE, TIME, FILE NUMBER
/s/ Michael B. Sullivan 7/11/96 D AND FILING OFFICER)
SIGNATURE(S) OF DEBTOR(S) E
- -------------------------------------------------- ---
Flex Products, Inc. 1
TYPE OR PRINT NAME(S) OF DEBTOR(S) 2
- --------------------------------------------------
3
/s/ John J. Gould
SIGNATURE(S) OF SECURED PARTY(IES) 4
- --------------------------------------------------
Fleet Capital Corporation 5
TYPE OR PRINT NAME(S) OF SECURED PARTY(IES) 6
==================================================
11. Return copy to: 7
NAME 8
ADDRESS
CITY 9
STATE
ZIP CODE 0
==================================================
FORM UCC.1--
Approved by the Secretary of State
==================================================
</TABLE>
<PAGE>
[LOGO] Fleet LEASE SCHEDULE NO. 32089-00002
Capital Leasing (True Lease Schedule)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
Lessee: FLEX PRODUCTS, INC.
Address: 1402 MARINER WAY
SANTA ROSA, CA 95407
1. This Lease Schedule No. 32089 - 00002 dated as of June 19, 1996 is
entered into pursuant to and incorporates by this reference, all of the terms
and provisions of that certain Master Equipment Lease Agreement No. 32089 dated
as of JUNE 19, 1996 (the "Master Lease"), for the lease of the Equipment
described in Schedule A attached hereto. This Lease Schedule shall constitute a
separate, distinct and independent lease of the Equipment and the contractual
obligation of Lessee. References to the "the Lease" or "this Lease" shall mean
and refer to this Lease Schedule, together with the Master Lease and all
exhibits, addenda, schedules, certificates, riders and other documents and
instruments executed and delivered in connection with this Lease Schedule, all
as the same may be amended or modified from time to time. All capitalized terms
used herein and not defined herein shall have the meanings set forth or
referred to in the Master Lease. By its execution and delivery of this Lease
Schedule, Lessee hereby reaffirms all of the representations, warranties and
covenants contained in the Master Lease, as of the date hereof, and further
represents and warrants to Lessor that no Event of Default, and no event or
condition which with notice or the passage of time or both would constitute an
Event of Default, has occurred and is continuing as of the date hereof.
2. ACQUISITION COST. The Acquisition Cost of the Equipment is:
$4,500,000.00.
3. (a) LEASE TERM. The Lease Term shall commence on the date hereof and
shall continue for a period of 72 months after the Lease Term Commencement Date
set forth in the Acceptance Certificate to this Lease Schedule, plus any renewal
or extended term applicable in accordance with the terms of the Lease.
(b) RENTAL PAYMENTS. In addition to interim rent payable pursuant
to Section 2 of the Master Lease, Lessee shall pay Lessor 72 consecutive Rental
Payments in the amounts set forth in the schedule below, plus any applicable
sales/use taxes, commencing on the Rental Payment Commencement Date set forth
in the Acceptance Certificate and MONTHLY thereafter for the remaining Lease
Term. Each Rental Payment shall be payable on the same day of the month as the
Rental Payment Date in each succeeding rental period during the remaining Lease
Term (each, a "Rental Payment Date"):
Amount of Each
Number of Rental Payments Rental Payment
------------------------- --------------
12 65,109.74
60 73,780.11
(c) ADVANCE RENTAL PAYMENT. Lessee agrees to pay Lessor the first
01 and last O Rental Payments, due and payable on the Acceptance Date.
<PAGE>
(d) SECURITY DEPOSIT. Lessee agrees to make a payment in an amount
equal to 0% of the Acquisition Cost of the Equipment, due and payable on the
Acceptance Date, to be held by Lessor as a non-interest bearing deposit to
secure Lessee's performance under the Lease.
4. EQUIPMENT LOCATION(S). The Equipment will be located at the
location(s) specified in Schedule A-1 hereto.
5. Lessor will invoice Lessee for all sales, use and/or personal
property taxes as and when due and payable in accordance with applicable law,
unless Lessee delivers to Lessor a valid exemption certificate with respect to
such taxes. Delivery of such certificate shall constitute Lessee's
representation and warranty that no such taxes shall become due and payable with
respect to the Equipment and Lessee shall indemnify and hold harmless Lessor
from and against any and all liability or damages, including late charges and
interest which Lessor may incur by reason of the assessment of such taxes.
6. The Rental Payments may change for Equipment accepted after
July 12, 1996.
7. Lessee represents that the applicable recovery period for the
Equipment, for purposes of Section 168 of the Internal Revenue Code of 1986, is
as set forth in Schedule A hereto.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
ACCEPTANCE CERTIFICATE
[LOGO] Fleet
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Acceptance Certificate (this "Acceptance Certificate") is attached
to and made a part of that certain Lease Schedule No. 32089 - 00002, dated as of
June 19, 1996 (the "Lease Schedule"), by and between the undersigned parties.
All capitalized terms used herein and not defined herein shall have the meanings
set forth or referred to in the Lease Schedule. To the extent the terms set
forth in this Acceptance Certificate differ or conflict with any of the terms
set forth in the Lease, the terms set forth in this Acceptance Certificate shall
control.
1. Lessee acknowledges and agrees that each item of Equipment set forth
on Schedule A hereto (collectively, the "Equipment") is hereby unconditionally
accepted by Lessee for all purposes under the Lease at the locations specified
in Schedule A-1 hereto, and hereby agrees to faithfully perform all of its
obligations under the Lease as of the date hereof (the "Acceptance Date").
Lessee hereby authorizes and directs Lessor to make payment to each vendor of
the Equipment pursuant to such vendor's invoice or any purchase order, purchase
agreement or supply contract with such vendor, receipt and approval of which are
hereby reaffirmed by Lessee.
2. By its execution and delivery of this Acceptance Certificate, Lessee
hereby reaffirms all of the representations, warranties and covenants contained
in the Lease as of the date hereof, and further represents and warrants to
Lessor that no Event of Default, and no event or condition which with notice or
the passage of time or both would constitute an Event of Default, has occurred
and is continuing as of the date hereof. Lessee further certifies to Lessor that
Lessee has selected the Equipment and has received and approved the purchase
order, purchase agreement or supply contract under which the Equipment will be
acquired for all purposes of the Lease.
3. Lessee hereby represents and warrants that: (a) the Equipment has been
delivered and is in an operating condition and performing the operation for
which it is intended to the satisfaction of the Lessee; and (b) if requested by
Lessor, the Equipment has been marked or labeled evidencing the Lessor's
interest therein.
4. The LEASE TERM COMMENCEMENT DATE is the 10th day of July, 1996
5. The RENTAL PAYMENT COMMENCEMENT DATE is the 10th day of July, 1996
6. All terms and provisions of the Lease Schedule shall remain in full force and
effect, except as otherwise provided below:
- ACQUISITION COST: $ 4,500,000.00.
- LEASE TERM: (72) seventy-two months.
- RENTAL PAYMENTS: Number of Rental Payments Rental Payment Amount
12 $______
60 $______
- ADVANCE RENTAL PAYMENT(S): First 01 and last 00.
- SECURITY DEPOSIT: N/A %.
Dated: July 10, 1996
Agreed and Accepted:
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
---------------------------- ---------------------------
Name: John J. Gould Name: Michael B. Sullivan
-------------------------- -------------------------
Title: VP/Senior Lender Title: President
-------------------------- -------------------------
<PAGE>
FLEET CAPITAL CORPORATION PAGE 1 OF 1
SCHEDULE A EQUIPMENT
Attached to and made part of the following documents: True Lease Schedule No.
32089-02, Acceptance Certificate, UCC Financing Statement(s), and Warranty Bill
of Sale with Flex Products, Inc.
The Depreciable Life of the Property is (07) seven years.
LOC# (01)
BETA FIVE:
Unit Number: Beta V
(1) General Vacuum Equipment Corp. electron beam metalyzing system, Mfg. 1995,
78" width capacity, 1200 feet per minute, 480 volt, 3 phase, 218 amps, model
95-005 overall size 9' X 10', serial number 95005 which machine includes, but is
not limited to, the following:
(8) Electron beam guns
(8) Airco Temescal Simba 2 electron beam power supplies, serial numbers
330, 337, 340, 338, 339, 336, 333 and 335
(8) Programmable seep generators
(8) High voltage controllers
(8) Electron beam gun controllers
(2) Polycolds, model PFC1100HC
(6) Varian 20" diffusion pumps, model 016513/HS-20
(8) Airco electron beam gun interfaces
(4) Trige-Scott drive motors, model S90L01199100203050300011, serial
numbers 104529421295, 104529211295, 104529311295 and 104529411295
AND ALL STANDARD AND ACCESSORY EQUIPMENT.
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
BY: /s/ John J. Gould BY: /s/ Michael B. Sullivan
-------------------------------- --------------------------------
NAME: John J. Gould NAME: Michael B. Sullivan
------------------------------ ------------------------------
TITLE: Vice President TITLE: President
----------------------------- -----------------------------
<PAGE>
FLEET CAPITAL CORPORATION Schedule A-1
Equipment Location
Attached to and made part of the following documents True Lease Schedule No.
32089-02, Acceptance Certificate, UCC Financing Statement(s), Warranty Bill of
Sale with Flex Products, Inc.
- --------------------------------------------------------------------------------
Loc # Equipment Currently Located at:
- --------------------------------------------------------------------------------
01 1402 Mariner Way, Santa Rosa, California 95407
- --------------------------------------------------------------------------------
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
[LOGO] Fleet PURCHASE OPTION RIDER
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (this "Rider") is attached to and made a
part of that certain Lease Schedule No. 32089-00002, dated as of June 19, 1996
(the "Lease Schedule"), by and between the undersigned parties.
If no Event of Default (or event or condition which, with the passage
of time or giving of notice, or both, would become such an Event of Default)
shall have occurred and be continuing, and the Lease shall not have been earlier
terminated, Lessee shall have the option to purchase (the "Purchase Option")
all, but not less than all, of the Equipment at the expiration of the Lease Term
for an amount, payable in immediately available funds on the last day of the
Lease Term, equal to: (a) all Rental Payments, late charges and other amounts
due and owing under the Lease; plus (b) all taxes, assessments and other charges
due or payable in connection with the sale of the Equipment to Lessee; plus (c)
an amount equal to 25.00000% of the Acquisition Cost of the Equipment, which
Lessor and Lessee acknowledge represents a reasonable current estimate of the
fair market value of the Equipment at the end of the Lease Term.
Provided that Lessor shall have received all amounts payable hereunder
on the last day of the Lease Term, and that no Event of Default then exists and
is continuing under the Lease, Lessor shall convey all of its right, title and
interest in and to the Equipment to Lessee on the last day of the Lease Term, on
an "AS-IS," "WHERE-IS" BASIS WITHOUT REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, and without recourse to Lessor, except that the Equipment shall be free
and clear of all liens created by Lessor. If Lessee intends to exercise the
Purchase Option, Lessee shall give irrevocable written notice to Lessor (the
"Option Notice") not more than 240 days, nor less than 180 days, prior to the
expiration of the Lease Term. If Lessee fails to give such written notice to
Lessor, it shall be conclusively presumed that Lessee has elected not to
exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 5.0% of the Acquisition Cost of the
Equipment.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
[LOGO] Fleet STIPULATED LOSS VALUE SCHEDULE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Stipulated Loss Value Schedule (this "Schedule") is attached to
and made a part of that certain Lease Schedule No. 32089-00002, dated as of June
19, 1996 (the "Lease Schedule"), by and between the undersigned parties.
<TABLE>
The following Stipulated Loss Values shall be used to calculate damages
or loss as provided in the Master Lease. The Stipulated Loss Value with respect
to any item of Equipment on any Rental Payment Date during the Lease Term shall
be an amount equal to the sum of: (a) all Rental Payments and other amounts then
due and owing to Lessor under the Lease, together with all accrued interest and
late charges thereon, calculated through and including the date of payment; plus
(b) the product of the Acquisition Cost of the such Equipment multiplied by the
percentage set forth below as of such Rental Payment Date.
<CAPTION>
<S> <C> <C> <C>
Rental Payment Date for Percentage of Rental Payment Date for Percentage of
Rental Payment Number Acquisition Cost Rental Payment Number Acquisition Cost
</TABLE>
SEE EXHIBIT C ATTACHED HERETO AND MADE A PART HEREOF
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
EXHIBIT C
TO
STIPULATED LOSS VALUE SCHEDULE
TO LEASE SCHEDULE NO. 32089-02
RENTAL PAYMENT PERCENTAGE OF RENTAL PAYMENT PERCENTAGE OF
DATE FOR RENTAL ACQUISITION COST DATE FOR RENTAL ACQUISITION COST
PAYMENT NUMBER PAYMENT NUMBER
1 103.35121715 37 70.90880090
2 102.77715752 38 69.75511355
3 102.19526265 39 68.59002020
4 101.59552206 40 67.41874422
5 100.98781724 41 66.23597391
6 100.37210821 42 65.04165152
7 99.73838360 43 63.84099969
8 99.09652408 44 62.62870597
9 98.44648879 45 61.40471189
10 97.78823666 46 60.16895869
11 97.11575495 47 58.92972240
12 96.43494366 48 57.67865042
13 95.54711438 49 56.42401842
14 94.34921445 50 55.15747340
15 93.74119331 51 53.87895553
16 92.81702863 52 52.59673978
17 91.88261080 53 51.30247247
18 90.93788832 54 49.99609306
19 89.97683797 55 48.68587582
20 89.00534921 56 47.36346638
21 88.02336959 57 46.02880349
22 87.03084644 58 44.68182560
23 86.02873119 59 43.33120369
24 85.01597126 60 41.96818663
25 83.99351758 61 40.60144498
26 82.96031708 62 39.22222721
27 81.91631576 63 37.83047065
28 80.86246378 64 36.43484516
29 79.79770726 65 35.02659847
30 78.72199142 66 33.60566720
31 77.63626563 67 32.18072044
32 76.53947521 68 30.74300521
33 75.43156457 69 29.29245738
34 74.31247787 70 27.82901249
35 73.18743961 71 26.37095856
36 72.05113926 72 24.89996987
72 25.00000000
<PAGE>
[LOGO] Fleet
Capital Leasing
PAY PROCEEDS LETTER
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
We hereby authorize you to pay the following Payee(s) from the proceeds of
your financial accommodations to us in respect of that certain True Lease
Schedule No. 32089-00002 dated as of June 19, 1996, and make disbursements
directly to said Payee(s) as follows:
Amount of
PAYEE Payment
Flex Products, Inc. * $4,421,390.26
- ---------------------------------------------------- -------------------------
Fleet Capital Corporation (short fund to pay 78,609.74
- ---------------------------------------------------- -------------------------
Customer Invoice now due)
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
TOTAL: $4,500,000.00
--------------------
Dated as of: June 19 , 1996
------------------------
* BANK: Bank of America, NTSA FLEX PRODUCTS, INC.
10 Santa Rosa Ave.
Santa Rosa, CA By: /s/ Michael B. Sullivan
---------------------------
ABA #: 12100358 Name: Michael B. Sullivan
-------------------------
For Account of: FLEX PRODUCTS INC. Title: President
-------------------------
Account #: 14984-00242
<PAGE>
<TABLE>
<CAPTION>
This FINANCING STATEMENT is presented for filing and will remain effective with certain
exceptions for a period of five years from the date of filing pursuant to section 9403 of the
California Uniform Commercial Code.
- ------------------------------------------------------------------------------------------------
<C> <C>
1. DEBTOR (LAST NAME FIRST--IF AN INDIVIDUAL) 1A. SOCIAL SECURITY OR FEDERAL TAX NO.
Flex Products, Inc.
- ------------------------------------------------------------------------------------------------
1B. MAILING ADDRESS 1C. CITY, STATE 1D. ZIP CODE
2793 Northpoint Parkway Santa Rosa, California 95407
- ------------------------------------------------------------------------------------------------
2. ADDITIONAL DEBTOR (IF ANY) 2A. SOCIAL SECURITY OR FEDERAL TAX NO.
(LAST NAME FIRST--IF AN INDIVIDUAL)
- ------------------------------------------------------------------------------------------------
2B. MAILING ADDRESS 2C. CITY, STATE 2D. ZIP CODE
- ------------------------------------------------------------------------------------------------
3. DEBTOR'S TRADE NAMES OR STYLES (IF ANY) 3A. FEDERAL TAX NUMBER
================================================================================================
4. SECURED PARTY 4A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME Fleet Capital Corporation
MAILING ADDRESS 50 Kennedy Plaza, 5th Floor
CITY Providence STATE RI ZIP CODE 02903
- ------------------------------------------------------------------------------------------------
5. ASSIGNEE OF SECURED PARTY (IF ANY) 5A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME
MAILING ADDRESS
CITY
- ------------------------------------------------------------------------------------------------
6. This FINANCING STATEMENT covers the following types or items of property (include description
of real property on which located and owner of record when required by instruction 4).
(1) General Vacuum Equipment Corp. electron beam metalyzing system as further described on
attached Schedule A(s) and all additions, accessions, modifications, improvements,
replacements, substitutions, and accessories thereto and therefor, whether now owned or
hereafter acquired, and proceeds, products and income of any of the foregoing, including
insurance proceeds. Debtor has possession of the equipment under a true lease only. Secured
Party has a security interest in the equipment to the extent necessary to protect its title
and interest therein.
Acct. No. 32089-02/lae (Fixture filing)
- ------------------------------------------------------------------------------------------------
7. CHECK [X] 7A. [ ] PRODUCTS OF COLLATERAL 7B. DEBTOR(S) SIGNATURE NOT REQUIRED IN
IF APPLICABLE ARE ALSO COVERED ACCORDANCE WITH INSTRUCTION 5(a) ITEM:
[ ](1) [ ](2) [ ](3) [ ](4)
- ------------------------------------------------------------------------------------------------
8. CHECK [X] [ ] DEBTOR IS A "TRANSMITTING UTILITY"
IF APPLICABLE IN ACCORDANCE WITH UCC SS. 9105 (1)(n)
- ------------------------------------------------------------------------------------------------
9. DATE: C 10. THIS SPACE FOR USE OF FILING OFFICER
O (DATE, TIME, FILE NUMBER
/s/ Michael B. Sullivan 7/11/96 D AND FILING OFFICER)
SIGNATURE(S) OF DEBTOR(S) E
- -------------------------------------------------- ---
Flex Products, Inc. 1
TYPE OR PRINT NAME(S) OF DEBTOR(S) 2
- --------------------------------------------------
3
/s/ John J. Gould
SIGNATURE(S) OF SECURED PARTY(IES) 4
- --------------------------------------------------
Fleet Capital Corporation 5
TYPE OR PRINT NAME(S) OF SECURED PARTY(IES) 6
==================================================
11. Return copy to: 7
NAME 8
ADDRESS
CITY 9
STATE
ZIP CODE 0
==================================================
FORM UCC.1--
Approved by the Secretary of State
==================================================
</TABLE>
<PAGE>
Memorandum
DATE: July 23, 1996
TO: Jeff Ryan
FROM: David Kitayama
RE: Fleet Credit Lease Documents
Comparing the signed lease documents I got on Monday and the previous
documents given to Flex as the final lease, it appears that the signed package
is not complete. Please secure file copies for Flex of the following documents:
1) All UCC filings
2) (Assistant) Secretary's Certificate
a) from OCLI
b) from Flex
3) Lease schedule p2 on both items leased
4) Support agreement between Fleet Capital Corp and OCLI and Flex Products.
5) Any and all side letters that constitute documentation supporting the
lease transactions.
We discussed items 4 and 5 this morning and you indicated that you would be
getting them from Fleet. Please add the other items to the list and let me know
when they are available.
<PAGE>
[LOGO] Fleet
Capital Leasing
July 18, 1996
Mr. Jeff Ryan
Flex Products, Inc.
1402 Mariner Way
Santa Rosa, California 95407
RE: ACCOUNT NO. 32089-01 and 02
Dear Jeff:
I would like to take this opportunity to thank you for working with Fleet
Capital Corporation on your recent financing requirements.
Enclosed for your files are copies of the executed documents referencing the
above account number. Invoices will be mailed to the address on this letter.
Please verify it; if invoices should be mailed to another address or another
individual within your organization, please contact our customer service
department at (800) 238-3737.
I have also included a revised Pay Proceeds letter for Lease Schedule 01, please
have this executed and return to my attention.
Again, thank you for your business. Please feel free to call us if you have
questions regarding your account or if we can be of any further service to you.
Very truly yours,
/s/ Sandy
Sandra Buonaiuto
Sr. Contract Administrator I
Enclosures
<PAGE>
[LOGO] PAY PROCEEDS LETTER
Fleet Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
We hereby authorize you to pay the following Payee(s) from the proceeds of
your financial accommodations to us in respect of that certain True Lease
Schedule No. 32089-00001 dated as of June 19, 1995, and make disbursements
directly to said Payee(s) as follows:
Amount of
PAYEE Payment
Flex Products, Inc. $ 7,765,000.09
- ---------------------------------------------------- -------------------------
Fleet Capital Corporation (short fund to pay 113,999.91
- ---------------------------------------------------- -------------------------
Customer Invoice now due)
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
TOTAL: $ 7,879,000.00
-------------------------
Dated as of: June 19, 1996
-----------------
FLEX PRODUCTS, INC.
By:
---------------------------
Name:
-------------------------
Title:
-------------------------
<PAGE>
MASTER EQUIPMENT LEASE AGREEMENT No. 32089
LESSOR: FLEET CAPITAL CORPORATION LESSEE: FLEX PRODUCTS, INC.
a Rhode Island corporation a Delaware corporation
Address: 50 Kennedy Plaza Address: 1402 Mariner Way
Providence, Rhode Island 02903-2305 Santa Rosa, California 95047
1. LEASE OF EQUIPMENT
Subject to the terms and conditions set forth herein (the "Master Lease") and
in any Lease Schedule incorporating the terms of this Master Lease (each, a
"Lease Schedule"). Lessor agrees to lease to Lessee, and Lessee agrees to lease
from Lessor, the items and units of personal property described in each such
Lease Schedule, together with all replacements, parts, additions, accessories
and substitutions therefor (collectively, the "Equipment"). Each Lease Schedule
shall constitute a separate, distinct and independent lease of Equipment and
contractual obligation of Lessee. References to "the Lease", "this Lease" or
"any Lease" shall mean and refer to any Lease Schedule which incorporates the
terms of this Master Lease, together with all exhibits, addenda, schedules,
certificates, riders and other documents and instruments executed and delivered
in connection with such Lease Schedule or this Master Lease, all as the same may
be amended or modified from time to time. The Equipment is to be delivered and
installed at the location specified or referred to in the applicable Lease
Schedule. The Equipment shall be deemed to have been accepted by Lessee for all
purposes under this Lease upon Lessor's receipt of an Acceptance Certificate
with respect to such Equipment, executed by Lessee after receipt of all other
documentation required by Lessor with respect to such Equipment. Lessor shall
not be liable or responsible for any failure or delay in the delivery of the
Equipment to Lessee for whatever reason. As used in the Lease with respect to
any item of Equipment, the terms "Acceptance Date", "Acquisition Cost", "Rental
Payment(s)", "Rental Payment Dates", "Rental Payment Numbers", "Rental Payment
Commencement Date", "Lease Term" and "Lease Term Commencement Date" shall have
the meanings and values assigned to them in the Lease Schedule and the
Acceptance Certificate applicable to such Equipment.
2. TERM AND RENT
The Lease Term for each item of Equipment shall be as specified in the
applicable Lease Schedule. Rental Payments shall be in the amounts and shall be
due and payable as set forth in the applicable Lease Schedule. If any rent or
other amount payable hereunder shall not be paid within 10 days of the date when
due, Lessee shall pay as an administrative and late charge an amount equal to 5%
of the amount of any such overdue payment. In addition, Lessee shall pay overdue
interest on any delinquent payment or other amounts due under the Lease (by
reason of acceleration or otherwise) from 30 days after the due date until paid
at the rate of 1 1/2% per month or the maximum amount permitted by applicable
law, whichever is lower. All payments to be made to Lessor shall be made to
Lessor in immediately available funds at the address shown above, or at such
other place as Lessor shall specify in writing. THIS IS A NON-CANCELABLE,
NON-TERMINABLE LEASE OF EQUIPMENT FOR THE ENTIRE LEASE TERM PROVIDED IN EACH
LEASE SCHEDULE HERETO.
3. POSSESSION; PERSONAL PROPERTY
No right, title or interest in the Equipment shall pass to Lessee other than
the right to maintain possession and use of the Equipment for the Lease Term
(provided no Event of Default has occurred) free from interference by any person
claiming by, through, or under Lessor. The Equipment shall always remain
personal property even though the Equipment may hereafter become attached or
affixed to real property. Lessee agrees to give and record such notices and to
take such other action at its own expense as may be necessary to prevent any
third party (other than an assignee of Lessor) from acquiring or having the
right under any circumstances to acquire any interest in the Equipment or this
Lease.
4. DISCLAIMER OF WARRANTIES
LESSOR IS NOT THE MANUFACTURER OR SUPPLIER OF THE EQUIPMENT, NOR THE AGENT
THEREOF, AND MAKES NO EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES AS TO ANY
MATTER WHATSOEVER, INCLUDING WITHOUT LIMITATION, THE MERCHANTABILITY OF THE
EQUIPMENT, ITS FITNESS FOR A PARTICULAR PURPOSE, ITS DESIGN OR CONDITION, ITS
CAPACITY OR DURABILITY, THE QUALITY OF THE MATERIAL OR WORKMANSHIP IN THE
MANUFACTURE OR ASSEMBLY OF THE EQUIPMENT, OR THE CONFORMITY OF THE EQUIPMENT TO
THE PROVISIONS AND SPECIFICATIONS OF ANY PURCHASE ORDER RELATING THERETO, OR
PATENT INFRINGEMENTS, AND LESSOR HEREBY DISCLAIMS ANY SUCH WARRANTY. LESSOR IS
NOT RESPONSIBLE FOR ANY REPAIRS OR SERVICE TO THE EQUIPMENT, DEFECTS THEREIN OR
FAILURES IN THE OPERATION THEREOF. Lessee has made the selection of each item of
Equipment and the manufacturer and/or supplier thereof based on its own judgment
and expressly disclaims any reliance upon any statements or representations made
by Lessor. For so long as no Event of Default (or event or condition which, with
the passage of time would become such an Event of Default) has occurred and is
continuing, Lessee shall be the beneficiary of, and shall be entitled to, all
rights under any applicable manufacturer's or vendor's warranties with respect
to the Equipment, to the extent permitted by law.
If the Equipment is not delivered, is not properly installed, does not
operate as warranted, becomes obsolete, or is unsatisfactory for any reason
whatsoever, Lessee shall make all claims on account thereof solely against the
manufacturer or supplier and not against Lessor, and Lessee shall nevertheless
pay all rentals and other sums payable hereunder. Lessee acknowledges that
neither the manufacturer or supplier of the Equipment, nor any sales
representative or agent thereof, is an agent of Lessor, and no agreement or
representation as to the Equipment or any other matter by any such sales
representative or agent of the manufacturer or supplier shall in any way affect
Lessee's obligations hereunder.
5. REPRESENTATIONS, WARRANTIES AND COVENANTS
Lessee represents and warrants to and covenants with Lessor that:
(a) Lessee has the form of business organization indicated above and is duly
organized and existing in good standing under the laws of the state listed in
the caption of this Master Lease and is duly qualified to do business wherever
necessary to carry on its present business and operations and to own its
property; (b) this Lease has been duly authorized by all necessary action on the
part of Lessee consistent with its form of organization, does not require any
further shareholder or partner approval, does not require the approval of, or
the giving notice to, any federal, state, local or foreign governmental
authority and does not contravene any law binding on Lessee or contravene any
certificate or articles of incorporation or by-laws or partnership certificate
or agreement, or any agreement, indenture, or other instrument to which Lessee
is a party or by which it may be bound; (c) this Lease has been duly executed
and delivered by authorized officers or partners of Lessee and constitutes a
legal, valid and binding obligation of Lessee enforceable in accordance with its
terms; (d) Lessee has not and will not, directly or indirectly, create, incur or
permit to exist any lien, encumbrance, mortgage, pledge, attachment or security
interest on or with respect to the Equipment or this Lease (except those of
persons claiming by, through or under Lessor); (e) the Equipment will be used
solely in the conduct of Lessee's business and will remain in the location shown
on the applicable Lease Schedule unless Lessor otherwise agrees in writing and
Lessee has completed all notifications, filings, recordings and other actions in
such new location as Lessor may reasonably request to protect Lessor's interest
in the Equipment; (f) there are no pending or threatened actions or proceedings
before any court or administrative agency which materially adversely affect
Lessee's financial condition or operations, and all credit, financial and other
information provided by Lessee or at Lessee's direction is, and all such
information hereafter furnished will be, true, correct and complete in all
material respects; (g) Lessor has not selected, manufactured or supplied the
Equipment to Lessee and has acquired any Equipment subject hereto solely in
connection with this Lease and Lessee has received and approved the terms of any
purchase order or agreement with respect to the Equipment; (h) Lessee shall
maintain, as of the end of each of Lessee's fiscal quarters, a Fixed Charge
Coverage Ratio of not less than 1.75:1 for each cumulative four quarter period
(if Lessee issues stock through an initial public stock offering ("IPO") (x)
during its fiscal quarter ending April 30, 1997, and the net proceeds to Lessee
from such IPO are no less than $15,0OO,000, and at the conclusion of such fiscal
quarter Lessee's TangibLe Net Worth is no less than the Base Net Worth, or (y)
after April 30, 1997, and Lessee's Tangible Net Worth, immediately following
such IPO, is no less than the Base Net Worth plus 50% of Lessee's total Net
Income for each fiscal quarter from and after the fiscal quarter ending July 31,
1997, to the date of the
Page 1 of 5
<PAGE>
IPO, Lessee shall thereafter maintain a Fixed Charge Coverage Ratio of no less
than 1.2:1); (i) Lessee shall maintain a ratio of total liabilities (including
the present value of non-cancelable equipment operating lease rentals) to
Tangible Net Worth of not more than 2.75:1 through until July 31, 1997, and of
not more than 2.0:1 thereafter; (j) Lessee shall maintain a Tangible Net Worth
of not less than $7,728,000 (the "Minimum Tangible Net Worth") through April 30,
1996, which Minimum Tangible Net Worth shall increase as of the end of each of
Lessee's fiscal quarters thereafter by the sum of (x) 50% of Lessee's Net Income
during such quarter and (y) 80% of the net proceeds of any stock issued by
Lessee during such quarter; (k) Lessee shall not make any payments to
shareholders, whether by dividend, commission, repayment of debt, loan or other
payments, if such payments would cause Lessee's cumulative four quarter Adjusted
Fixed Charge Coverage Ratio to be less than 1.0:1 or Lessee's Current Ratio to
be less than 1.2:1 or result in Lessee's breach of any other covenant herein;
and (1) more than 50% of Lessee's voting capital stock, or effective control of
Lessee's voting capital stock, issued and outstanding from time to time, shall
be retained by Optical Holding Laboratory, Inc., ("OCLI"). Notwithstanding the
provisions set forth in Section 5 (1) above, in the event that SICPA Holding,
S.A. ("SICPA") acquires more than 50% of Lessee's voting capital stock, or
effective control of Lessee's voting capital stock, issued and outstanding from
time to time, Lessor agrees that, upon delivery of such financial information on
SICPA as Lessor deems necessary, Lessor shall consider a request by Lessee to
substitute SICPA for OCLI for purposes of the covenant set forth in Section 5
(1). The sale of the Equipment by Lessee to Lessor and Lessee's undertaking of
the obligations contained herein shall not cause Lessee to be insolvent within
the meaning of applicable state and/or federal laws. The payment by Lessor to
Lessee of the Acquisition Cost of the Equipment, as set forth from time to time
on the Acquisition Certificate, is fair consideration for each item of Equipment
within the meaning of applicable state and federal laws.
Without limiting the generality of any of the foregoing representations and
warranties, the sale by Lessee to Lessor of the Equipment does not require any
stockholder approval or consent of any trustee or holders of any indebtedness or
obligations of Lessee and will not, to Lessee's knowledge, contravene any laws,
statutes, regulations, judgments or decrees applicable to Lessee, including, but
not limited to, laws or statutes regarding fraudulent conveyances, bankruptcy,
creditors' rights or bulk transfers, or the certificate of incorporation or
by-laws of Lessee, or contravene the provisions of, or constitute a default
under, or violate any restrictive covenants or other agreement to which Lessee
is a party or by which Lessee or its assets may be bound or affected, and any
authorization, approval, license, filing or registration with any court or
governmental agency or instrumentality which is necessary in connection with
such sale has, to Lessee's knowledge, been effected and a written copy thereof
has been delivered to Lessor. Lessee has full power, authority and legal right
to sell the Equipment to Lessor. The sale of the Equipment to Lessor has been
duly authorized by all necessary corporate action and constitutes a legal, valid
and binding obligation of Lessee. Lessor's decision to accept such substitution
shall be made in Lessor's sole discretion and will require, among other things,
the execution of a Support Agreement from SICPA substantially in the form of the
Support Agreement executed by OCLI.
For the purposes of this section the following definitions shall apply:
"Adjusted Fixed Charge Coverage Ratio" shall be defined as the sum of Net
Income, depreciation, amortization, interest expense, taxes on income, and
operating lease payments divided by the sum of interest expense, current
maturities of long term debt, operating lease payments, net repayment of
shareholder debt on an intra-quarterly basis, and dividend payments.
"Base Net Worth" shall be defined as the sum of the net proceeds received
by Lessee from the issuance of stock through an IPO and $15,000,000.
"Current Ratio" shall be defined as all cash, cash equivalents, accounts
receivable, inventory, prepaid expenses, and other current rights to
receive payments as of the date of determination thereof in accordance with
generally accepted accounting principles ("GAAP") divided by all
liabilities which should, in accordance with GAAP consistently applied, be
classified as current liabilities, and in any event including all
indebtedness payable on demand or within one year from the date of
determination without any option on the part of Lessee to extend or renew
beyond such year, and including the current portion of long term debt
required to be paid within one year.
"Fixed Charge Coverage Ratio" shall be defined as the sum of net income,
depreciation, amortization, interest expense, and operating lease payments
divided by the sum of interest expense, current maturities of long term
debt, and operating lease payments.
"Tangible Net Worth" shall be defined as the excess of all assets,
excluding any value for goodwill, trademarks, patents, copyrights,
organization expense, other similar intangible items, and receivables from
stockholders that do not arise from the sale of product to stockholders,
employees and affiliated companies, over total liabilities.
All other financial terms used herein and not defined herein, shall be
defined in accordance with GAAP, consistently applied.
6. INDEMNITY
Lessee assumes the risk of liability for, and hereby agrees to indemnify and
hold safe and harmless, and covenants to defend, Lessor, its employees, servants
and agents from and against: (a) any and all liabilities, losses, damages,
claims and expenses (including legal expenses of every kind and nature) arising
out of the manufacture, purchase, shipment and delivery of the Equipment to
Lessee, acceptance or rejection, ownership, titling, registration, leasing,
possession, operation, use, return or other disposition of the Equipment,
including, without limitation, any liabilities that may arise from patent or
latent defects in the Equipment (whether or not discoverable by Lessee), any
claims based on absolute tort liability or warranty and any claims based on
patent, trademark or copyright infringement; (b) any and all loss or damage of
or to the Equipment; and (c) any obligation or liability to the manufacturer or
any supplier of the Equipment arising under any purchase orders issued by or
assigned to Lessor.
7. TAXES AND OTHER CHARGES
Lessee agrees to comply with all laws, regulations and governmental orders
related to this Lease and to the Equipment and its use or possession, and to pay
when due, and to defend and indemnify Lessor against liability for all license
fees, assessments, and sales, use, property, excise, privilege and other taxes
(including any related interest or penalties) or other charges or fees now or
hereafter imposed by any governmental body or agency upon any Equipment, or with
respect to the manufacturing, ordering, shipment, purchase, ownership, delivery,
installation, leasing, operation, possession, use, return, or other disposition
thereof or the rentals hereunder (other than taxes on or measured solely by the
net income of Lessor). Any fees, taxes or other lawful charges paid by Lessor
upon failure of Lessee to make such payments shall at Lessor's option become
immediately due from Lessee to Lessor.
Lessor and Lessee agree that Lessor is the owner of the Equipment for Federal
income tax purposes. Lessee covenants that it shall not take any action which is
inconsistent with Lessor's ownership of the Equipment.
For purposes of this Section 7, the term Tax Benefits shall mean cost
recovery deductions under Section 168 of the Internal Revenue Code of 1986, as
amended, using a 200% declining balance method of depreciation switching to the
straight line method for the first taxable year for which such method will yield
larger depreciation deductions, and assuming a half-year convention and zero
salvage value, for the applicable recovery period for such Equipment as set
forth in the Lease Schedule with respect to such Equipment.
If, as a result of any act, failure to act or any omission on the part of
Lessee, or breach of any representation, warranty or covenant made by Lessee
hereunder, there shall be a loss, disallowance, recapture or delay in claiming
all or any portion of the Tax Benefits with respect to the Equipment, or there
shall be included in Lessor's gross income for Federal, state or local income
tax purposes any amount on account of any addition, modification or improvement
to or in respect of any of the Equipment made or paid for by Lessee (any loss,
disallowance, recapture, delay, inclusion or change being herein called a "Tax
Loss"), then thirty (30) days after written notice to Lessee by Lessor that a
Tax Loss has occurred, Lessee shall pay Lessor a lump sum amount which, after
deduction of all taxes required to be paid by Lessor with respect to the receipt
of such amount, will provide Lessor with an amount necessary to maintain
Lessor's after-tax economic yield and overall net after-tax cash flows at least
at the same level that would have been available if such Tax Loss had not
occurred, plus any interest, penalties or additions to tax which may be imposed
in connection with such Tax Loss. In lieu of paying such Tax Loss in a lump sum,
Lessor may require, or upon Lessee's request, may agree, in Lessor's sole
discretion, that such Tax Loss shall be paid in equal periodic payments over the
applicable remaining Lease Term with respect to such Equipment with each Rental
Payment due and payable with respect to such Equipment. Notwithstanding, and in
addition to, the
Page 2 of 5
<PAGE>
portion of the Tax Benefits with respect to the Equipment and such loss of Tax
Benefits is the result of any act, failure to act or any omission on the part of
Lessee or a breach of any representation, warranty or covenant made by Lessee
hereunder, and either (a) a deficiency shall have been proposed by the Internal
Revenue Service or other taxing authority having jurisdiction, or (b) tax
counsel for Lessor has rendered an opinion to Lessor that such Tax Loss has so
occurred. The foregoing indemnities and covenants set forth in Section 7 of this
Master Lease shall continue in full force and effect and shall survive the
expiration or earlier termination of the Lease.
8. DEFAULT
Lessee shall be in default of this Lease upon the occurrence of any one or
more of the following events (each an "Event of Default"):
(a) Lessee shall fail to make any payment, of rent or otherwise, under any
Lease within 10 days of the date when due; or (b) Lessee shall fail to obtain or
maintain any of the insurance required under any Lease; or (c) Lessee shall fail
to perform or observe any covenant, condition or agreement under any Lease, and
such failure continued for 10 days after notice thereof to Lessee, provided,
however, that no such failure to perform or observe shall constitute an Event of
Default hereunder, where Lessee has commenced curing such failure to perform or
observe within such ten (10) day period and continues to diligently pursue such
cure in the opinion of Lessor; or (d) Lessee shall default in the payment or
performance of any indebtedness or obligation to Lessor or any affiliated
person, firm or entity controlling, controlled by or under common control with
Lessor, under any loan, note, security agreement, lease, guaranty, title
retention or conditional sales agreement or any other instrument or agreement
evidencing such indebtedness with Lessor or such other affiliated person, firm
or entity affiliated with Lessor; or (e) any representation or warranty made by
Lessee herein or in any certificate, agreement, statement or document hereto or
hereafter furnished to Lessor in connection herewith, including without
limitation, any financial information, disclosed to Lessor shall prove to be
false or incorrect in any material respect; or (f) death or judicial declaration
of incompetence of Lessee, it an individual; the commencement of any bankruptcy,
insolvency, arrangement, reorganization, receivership, liquidation or other
similar proceeding by or against Lessee or any of its properties or businesses,
or the appointment of a trustee, receiver, liquidator or custodian for Lessee or
any of its properties of business, or if Lessee suffers the entry of an order
for relief under Title 11 of the United States Code; or the making by Lessee era
general assignment or deed of trust for the benefit of creditors, or (g) Lessee
shall default in any payment on any obligation to any third party, which is
greater than $1,000,000, and any applicable grace or cure period with respect:
thereto has expired; or (h) Lessee shall terminate its existence by merger,
consolidation, sale of substantially all of its assets or otherwise; or (i)
Lessee shall be in breach of Section 5 (1) hereof as such Section 5 (1) may be
revised from time to time pursuant to the terms of Section 5; or (j) if Lessee
is a publicly held corporation, there shall be a change in the ownership of
Lessee's stock such that Lessee is no longer subject to the reporting
requirements of the Securities Exchange Act of 1934, or no longer has a class of
equity securities registered under Section 12 of the Securities Act of 1933; or
(k) Lessor shall determine, in its sole discretion and in good faith, that there
has been a material adverse change in the financial condition of the Lessee
since the date of this Lease, or that Lessee's ability to make any payment
hereunder promptly when due or otherwise comply with the terms of this Lease or
any other agreement between Lessor and Lessee is impaired; or (l) any event or
condition set forth in subsections (e), (f) or (h) of this Section 8 shall occur
with respect to any guarantor or other person responsible, in whole or in part,
for payment or performance of this Lease; or (m) any event or condition set
forth in subsections (d) through (j) shall occur with respect to any person,
firm or entity controlled by Lessee. Lessee shall promptly notify Lessor of the
occurrence of any Event of Default or the occurrence or existence of any event
or condition which, upon the giving of notice of lapse of time, or both, may
become an Event of Default.
9. REMEDIES
Upon the occurrence of any Event of Default, Lessor may, at its sole option
and discretion, exercise one or more of the following remedies with respect to
any or all of the Equipment: (a) cause Lessee to promptly return, at Lessee's
expense, any or all Equipment to such location as Lessor may designate in
accordance with the terms of Section 18 of this Master Lease, or Lessor, at its
option, may enter upon the premises where the Equipment is located and take
immediate possession of and remove the same by summary proceedings or otherwise,
all without liability to Lessor for or by reason of damage to property or such
entry or taking possession except for Lessor's gross negligence or willful
misconduct; (b) sell any or all Equipment at public or private sale or otherwise
dispose of, hold, use, operate, lease to others or keep idle the Equipment, all
as Lessor in its sole discretion may determine and all free and clear of any
rights of Lessee; (c) remedy such default, including making repairs or
modifications to the Equipment, for the account and expense of Lessee, and
Lessee agrees to reimburse Lessor for all of Lessor's costs and expenses; (d) by
written notice to Lessee, terminate the Lease with respect to any or all Lease
Schedules and the Equipment subject thereto, as such notice shall specify, and,
with respect to such terminated Lease Schedules and Equipment, declare
immediately due and payable and recover from Lessee, as liquidated damages for
loss of Lessor's bargain and not as a penalty, an amount equal to the Stipulated
Loss Value, calculated as of the next following Rental Payment Date: (e) apply
any deposit or other cash collateral or sale or remarketing proceeds of the
Equipment at any time to reduce any amounts due to Lessor, and (f) exercise any
other right or remedy which may be available to Lessor under applicable law, or
proceed by appropriate court action to enforce the terms hereof or to recover
damages for the breach hereof, including reasonable attorneys' fees and court
costs. No remedy referred to in this Section 9 shall be exclusive, but each
shall be cumulative and in addition to any other remedy referred to above or
otherwise available to Lessor at law or in equity.
The exercise or pursuit by Lessor of any one or more of such remedies shall
not preclude the simultaneous or later exercise or pursuit by Lessor of any or
all such other remedies, and all remedies hereunder shall survive termination of
this Lease. At any sale of the Equipment pursuant to this Section 9, Lessor may
bid for the Equipment. Notice required, if any, of any sale or other disposition
hereunder by Lessor shall be satisfied by the mailing of such notice to Lessee
at least seven (7) days prior to such sale or other disposition. In the event
Lessor takes possession and disposes of the Equipment, the proceeds of any such
disposition shall be applied in the following order: (1) to all of Lessor's
costs, charges and expenses incurred in taking, removing, holding, repairing and
selling or leasing the Equipment; (2) to the extent not previously paid by
Lessee, to pay Lessor for any damages then remaining unpaid hereunder; (3) to
reimburse Lessee for any sums previously paid by Lessee as damages hereunder;
and (4) the balance, if any, shall be retained by Lessor. A termination shall
occur only upon written notice by Lessor and only with respect to such Equipment
as Lessor shall specify in such notice. Termination under this Section 9 shall
not affect Lessee's duty to perform Lessee's obligations hereunder to Lessor in
full. Lessee agrees to reimburse Lessor on demand for any and all costs and
expenses incurred by Lessor in enforcing its rights and remedies hereunder
following the occurrence of an Event of Default, including, without limitation,
reasonable attorney's fees, and the costs of repossession, storage, insuring,
reletting, selling and disposing of any and all Equipment.
The term "Stipulated Loss Value" with respect to any item of Equipment shall
mean the Stipulated Loss Value as set forth in any Schedule of Stipulated Loss
Values attached to and made a part of the applicable Lease Schedule. If there is
no such Schedule of Stipulated Loss Values, then the Stipulated Loss Value with
respect to any item of Equipment on any Rental Payment Date during the Lease
Term shall be an amount equal to the sum of: (a) all Rental Payments and other
amounts then due and owing to Lessor under the Lease, together with all accrued
interest and late charges thereon calculated through and including the date of
payment; plus (b) the net present value of: (i) all Rental Payments then
remaining unpaid for the Lease Term, plus (ii) the amount of any purchase
obligation with respect to the Equipment or, if there is no such obligation,
then the fair market value of the Equipment at the end of such term, as
estimated by Lessor in its sole discretion, all discounted to net present value
at a discount rate equal to the 1-year Treasury Constant Maturity rate as
published in the Selected Interest Rates table of the Federal Reserve
statistical release H.15(519) for the week ending immediately prior to the
original Acceptance Date for such Equipment.
10. ADDITIONAL SECURITY
For so long as any obligations of Lessee shall remain outstanding under any
Lease, Lessee hereby grants to Lessor a security interest in all of Lessee's
rights in and to Equipment subject to such Lease from time to time, to secure
the prompt payment and performance when due (by reason of acceleration or
otherwise) of each and every indebtedness, obligation or liability of Lessee, or
any affiliated person, firm, or entity controlled by Lessee, owing to Lessor,
whether now existing or hereafter arising, including but not limited to all of
such obligations under or in respect of any Lease. The extent to which Lessor
shall have a purchase money security interest in any item of Equipment under a
Lease which is deemed to create a security interest under Section 1-201(37) of
the Uniform Commercial Code shall be determined by reference to the Acquisition
Cost of such item financed by Lessor. In order more fully to secure its rental
payments and all other obligations to Lessor hereunder, Lessee hereby grants to
Lessor a security interest in any deposit of Lessee to Lessor under Section 3(d}
of any Lease Schedule hereto. Such security deposit shall not bear interest, may
be commingled with other funds of Lessor and shall be immediately restored by
Lessee if applied under Section 9. Upon expiration of the term of this Lease and
satisfaction of all of Lessee's obligations, the security deposit shall be
returned to Lessee. The term "Lessor" as used in this Section 10 shall include
any affiliated person, firm or entity controlling, controlled by or under common
control with Lessor.
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<PAGE>
11. NOTICES
Any notices or demands required or permitted to be given under this Lease
shall be given in writing and either (i) by regular mail, by hand or by
overnight courier, which notice shall become effective when received, or (ii) by
facsimile or other form of electronic transmission, which notice shall become
effective upon transmission thereof, such notice shall be addressed to Lessor to
the attention of Customer Accounts, and to Lessee at the address set forth
above, or to such other address as the party to receive notice hereafter
designates by such written notice.
12. USE; MAINTENANCE; INSPECTION; LOSS AND DAMAGE
During the Lease Term for each item of Equipment, Lessee shall, unless Lessor
shall otherwise consent in writing: (a) permit each item of Equipment to be used
only within the continental United States by qualified personnel solely for
business purposes and the purpose for which it was designed and shall, at its
sole expense, service, repair, overhaul and maintain each item of Equipment in
the same condition as when received, ordinary wear and tear excepted, in good
operating order, consistent with prudent industry practice (but, in no event
less than the same extent to which Lessee maintains other similar equipment in
the prudent management of its assets and properties) and in compliance with all
applicable laws, ordinances, regulations, and conditions of all insurance
policies required to be maintained by Lessee under the Lease and all manuals,
orders, recommendations, instructions and other written requirements as to the
repair and maintenance of such item of Equipment issued at any time by the
vendor and/or manufacturer thereof; (b) maintain conspicuously on each item of
Equipment such labels, plates, decals or other markings as Lessor may reasonably
require, stating that Lessor is owner of such item of Equipment; (c) furnish to
Lessor such information concerning the condition, location, use and operation of
the Equipment as Lessor may request; (d) upon reasonable advance notice, permit
any person designated by Lessor to visit and inspect, during normal business
hours, any item of Equipment and any records maintained in connection
therewith, provided, however, that the failure of Lessor to inspect the
Equipment or to inform Lessee of any noncompliance shall not relieve Lessee of
any of its obligations hereunder; (e) if any item of Equipment does not comply
with the requirements of this Lease, Lessee shall, within 30 days of written
notice from Lessor, bring such Equipment into compliance; (f) not use any
Equipment, nor allow the same to be used, for any unlawful purpose, nor in
connection with any property or material that would subject the Lessor to any
liability under any state or federal statute or regulation pertaining to the
production, transport, storage, disposal or discharge of hazardous or toxic
waste or materials; and (g) make no additions, alterations, modifications or
improvements (collectively, "Improvements") to any item of Equipment that are
not readily removable without causing material damage to such item of Equipment
or which will cause the value, utility or useful life of such item of Equipment
to materially decline. If any such Improvement is made and cannot be removed
without causing material damage or decline in value, utility or useful life (a
"Non-Severable Improvement"), then Lessee warrants that such Non-Severable
Improvement shall immediately become Lessor's property upon being installed and
shall be free and clear of all liens and encumbrances and shall become Equipment
subject to all of the terms conditions of the Lease. All such Improvements that
are not Non-Severable Improvements shall be removed by Lessee prior to the
return of the item of Equipment hereunder or such Improvements shall also become
the sole and absolute property of Lessor without any further payment by Lessor
to Lessee and shall be free and clear of all liens and encumbrances whatsoever.
Lessee shall repair all damage to any item of Equipment caused by the removal of
any Improvement so as to restore such item of Equipment to the same condition
which existed prior to its installation and as required by this Lease.
Lessee hereby assumes all risk of loss, damage or destruction for whatever
reason to the Equipment from and after the earlier of the date (i) on which the
Equipment is ordered or (ii) Lessor pays the purchase price of the Equipment,
and continuing until the Equipment has been returned to, and accepted by, Lessor
in the condition required by Section 18 hereof upon the expiration of the Lease
Term. If during the Lease Term any item of Equipment shall become lost, stolen,
destroyed, damaged beyond repair or rendered permanently unfit for use for any
reason, or in the event of any condemnation, confiscation, theft or seizure or
requisition of title to or use of such item, Lessee shall immediately pay to
Lessor an amount equal to the Stipulated Loss Value of such item, as of the next
following Rental Payment Date.
13. INSURANCE
Lessee shall procure and maintain insurance in such amounts and upon such
terms and with such companies as Lessor may approve, during the entire Lease
Term and until the Equipment has been returned to, and accepted by, Lessor in
the condition required by Section 18 hereof, at Lessee's expense, provided that
in no event shall such insurance be less than the following coverages and
amounts: (a) Worker's Compensation and Employer's Liability Insurance, in the
full statutory amounts provided by law; (b) Comprehensive General Liability
Insurance including product/completed operations and contractual liability
coverage, with minimum limits of $1,000,000 each occurrence. and Combined Single
Limit Body Injury and Property Damage, $1,000,000 aggregate, where applicable;
and (c) All Risk Physical Damage Insurance, including earthquake and flood, on
each item of Equipment, in an amount not less than the greater of the Stipulated
Loss Value of the Equipment or (if available) its full replacement value. Lessor
will be included as an additional insured and loss payee as its interest may
appear. Such policies shall be endorsed to provide that the coverage afforded to
Lessor shall not be rescinded, impaired or invalidated by any act or neglect of
Lessee. Lessee agrees to waive Lessee's right and its insurance carrier's rights
of subrogation against Lessor for any and all loss or damage.
Notwithstanding the foregoing, Lessee shall not be required to maintain
earthquake insurance in an amount in excess of the then current Stipulated Loss
Value with a 15% deductible.
In addition to the foregoing minimum insurance coverage, Lessee shall procure
and maintain such other insurance coverage as lessor may reasonably require from
time to time during the Lease Term. All policies shall be endorsed to contain a
clause requiring the insurer to furnish Lessor with at least 30 days' prior
written notice of any material change, cancellation or non-renewal of coverage.
Upon execution of this Lease, Lessee shall furnish Lessor with a certificate of
insurance or other evidence satisfactory to Lessor that such insurance coverage
is in effect, provided, however, that Lessor shall be under no duty either to
ascertain the existence of or to examine such insurance coverage or to advise
Lessee in the event such insurance coverage should not comply with the
requirements hereof. In case of failure of Lessee to procure or maintain
insurance, Lessor may at its option obtain such insurance, the cost of which
will be paid by the Lessee as additional rentals. Lessee hereby irrevocably
appoints Lessor as Lessee's attorney-in-fact to file, settle or adjust, and
receive payment of claims under any such insurance policy and to endorse
Lessee's name on any checks, drafts or other instruments on payment of such
claims. Lessee further agrees to give Lessor prompt notice of any damage to or
loss of, the Equipment, or any part thereof.
14. LIMITATION OF LIABILITY
Lessor shall have no liability in connection with or arising out of the
ownership, leasing, furnishing, performance or use of the Equipment or any
special, indirect, incidental or consequential damages of any character,
including, without limitation, loss of use of production facilities or
equipment, loss of profits, property damage or lost production, whether suffered
by Lessee or any third party.
15. FURTHER ASSURANCES
Lessee shall promptly execute and deliver to Lessor such further documents
and take such further action as Lessor may reasonably require in good faith, in
order to more effectively carry out the intent and purpose of this Lease. Lessee
shall provide to Lessor, within 120 days after the close of each of Lessee's
fiscal years, and, within 45 days of the end of each quarter of Lessee's fiscal
year, a copy of its financial statements prepared in accordance with generally
accepted accounting principles and, in the case of annual financial statements,
audited by independent certified public accountants, and in the case of
quarterly financial statements certified by Lessee's chief financial officer,
each such financial statement to be accompanied by a Compliance Certificate,
substantially in the form of Exhibit A attached hereto, certified by Lessee's
chief financial officer, as to Lessee's compliance with subsections (h) through
(k) of Section 5 above. Lessee shall execute and deliver to Lessor upon Lessor's
request such instruments and assurances as Lessor deems necessary for the
confirmation, preservation or perfection of this Lease and Lessor's rights
hereunder, including, without limitation, such corporate resolutions and
opinions of counsel as Lessor may request from time to time, and all schedules,
forms and other reports as may be required to satisfy obligations imposed by
taxing authorities. In furtherance thereof, Lessor may file or record this Lease
or a memorandum or a photocopy hereof (which for the purposes hereof shall be
effective as a financing statement) so as to give notice to third parties, and
Lessee hereby appoints Lessor as its attorney-in-fact to execute, sign, file and
record UCC financing statements and other lien recordation documents with
respect to the Equipment where Lessee fails or refuses to do so after Lessor's
written request, and Lessee agrees to pay or reimburse Lessor for any filing,
recording or stamp fees or taxes arising from any such filings.
16. ASSIGNMENT
This Lease and all rights of Lessor hereunder shall be assignable by Lessor
absolutely or as security, without notice to Lessee, subject to the rights of
Lessee hereunder for the use and possession of the Equipment for so long as no
Event of Default has occurred and is continuing hereunder. Any such assignment
shall not relieve Lessor of its obligations hereunder unless specifically
assumed by the assignee, and Lessee
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<PAGE>
agrees it shall not assert any defense, rights of set-off or counterclaim
against any assignee to which Lessor shall have assigned its rights and
interests hereunder, nor hold or attempt to hold such assignee liable for any of
Lessor's obligations hereunder. No such assignment shall materially increase
Lessee's obligations hereunder. Lessee agrees, upon Lessor's written request, to
provide to any such assignee an acknowledgment of such assignment confirming the
terms, conditions, representations, warranties and covenants contained in this
Lease.
LESSEE SHALL NOT ASSIGN OR DISPOSE OF ANY OF ITS RIGHTS OR OBLIGATIONS UNDER
THIS LEASE OR ENTER INTO ANY SUBLEASE WITH RESPECT TO ANY OF THE EQUIPMENT
WITHOUT THE EXPRESS PRIOR WRITTEN CONSENT OF LESSOR.
17. LESSEE'S OBLIGATION UNCONDITIONAL
This Lease is a net lease and Lessee hereby agrees that it shall not be
entitled to any abatement of rents or of any other amounts payable hereunder by
Lessee, and that its obligation to pay all rent and any other amounts owing
hereunder shall be absolute and unconditional under all circumstances,
including, without limitation, the following circumstances: (i) any claim by
Lessee to any right of set-off, counterclaim, recoupment, defense or other right
which Lessee may have against Lessor, any seller or manufacturer of any
Equipment or anyone else for any reason whatsoever; (ii) the existence of any
liens, encumbrances or rights of others whatsoever with respect to any
Equipment, whether or not resulting from claims against Lessor not related to
the ownership of such Equipment; or (iii) any other event or circumstances
whatsoever. Each Rent Payment or other amount paid by Lessee hereunder shall be
final and Lessee will not seek to recover all or any part of such payment from
Lessor for any reason whatsoever.
18. RETURN OF EQUIPMENT
Upon the expiration or earlier termination of the Lease Term with respect to
any item of Equipment, and provided that Lessee has not validly exercised any
purchase option with respect thereto, Lessee shall: (a) return the Equipment to
a location and in the manner designated by the Lessor within the continental
United States, including, as reasonably required by Lessor, securing
arrangements for the disassembly and packing for shipment by an authorized
representative of the manufacturer of the Equipment, shipment with all parts and
pieces on a carrier designated or approved by Lessor, and then reassembly
(including, if necessary, repair and overhaul) by such representative at the
return location in the condition the Equipment is required to be maintained by
the Lease and in such condition as will make the Equipment (in its original
configuration or as upgraded) immediately able to satisfy the acceptance test
protocol used to accept the Equipment from the original equipment manufacturer),
and immediately qualified for the manufacturer's (or other authorized servicing
representatives) then-available service contract or warranty (Lessee may replace
any proprietary optical monitoring systems with commercially available optical
monitoring systems, at Lessee's sole expense); (b) cause the Equipment to
qualify for all applicable licenses or permits necessary for its operation for
its intended purpose and to comply with all specifications and requirements of
applicable federal, state and local laws, regulations and ordinances; (c) upon
Lessor's request, provide suitable storage, acceptable to Lessor, for the
Equipment for a period not to exceed 180 days from the date of return; (d)
cooperate with Lessor in attempting to remarket the Equipment, including display
and demonstration of the Equipment to prospective purchasers or lessees, and
allowing Lessor to conduct any private or public sale or auction of the
Equipment on Lessee's premises. All costs (except for any costs that may be
incurred in preparing the utilities or infrastructure necessary for operating
the Equipment at the return location) shall be the sole responsibility of the
Lessee. During any period of time from the expiration or earlier termination of
the Lease until the Equipment is returned in accordance with the provisions
hereof or until Lessor has been paid the applicable purchase option price if any
applicable purchase option is exercised, Lessee agrees to pay to Lessor
additional per diem rent ("Holdover Rent"), payable promptly on demand in an
amount equal to 125% of the highest monthly Rental Payment payable during the
Lease Term divided by 30, provided, however, that nothing contained herein and
no payment of Holdover Rent hereunder shall relieve Lessee of its obligation to
return the Equipment upon the expiration or earlier termination of the Lease.
19. MISCELLANEOUS
THE LEASE REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES CONCERNING THE
LEASE OF THE EQUIPMENT AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. LESSEE
ACKNOWLEDGES AND CERTIFIES THAT NO SUCH ORAL AGREEMENTS EXIST. The Lease may not
be amended, nor may any rights under the Lease be waived, except by an
instrument in writing signed by the party charged with such amendment or waiver.
The term "Lessee" as used in the Lease shall mean and include any and all
Lessees who sign below, each of whom shall be jointly and severally liable under
the Lease. This Master Lease will not be binding on Lessor until accepted and
executed by Lessor, notice of which is hereby waived by Lessee. Any waiver of
the terms hereof shall be effective only in the specific instance and for the
specific purpose given. Time is of the essence in the payment and performance of
all of Lessee's obligations under the Lease. The captions in this Lease are for
convenience only and shall not define or limit any of the terms hereof.
20. ENFORCEABILITY AND GOVERNING LAW
Any provisions of this Lease which are unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
unenforceability without invalidating the remaining provisions hereof, and any
such unenforceability in any jurisdiction shall not render unenforceable such
provisions in any other jurisdiction. To the extent permitted by applicable law,
Lessee hereby waives; (a) any provisions of law which render any provision
hereof unenforceable in any respect; (b) all rights and remedies under Rhode
Island General Laws Sections 6A-2.1-508 through 522 or corresponding provisions
of the Uniform Commercial Code article or division pertaining to personal
property leasing in any jurisdiction in which enforcement of this Lease is
sought.
THIS LEASE AND THE LEGAL RELATIONS OF THE PARTIES HERETO SHALL IN ALL
RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF RHODE ISLAND, WITHOUT REGARD TO PRINCIPLES REGARDING THE CHOICE OF LAW.
LESSEE HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF THE COURTS OF THE
STATE OF RHODE ISLAND AND CALIFORNIA AND THE FEDERAL DISTRICT COURT FOR THE
DISTRICT OF RHODE ISLAND AND THE NORTHERN DISTRICT OF CALIFORNIA FOR THE
PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF ITS OBLIGATIONS
HEREUNDER, AND EXPRESSLY WAIVES ANY OBJECTIONS THAT IT MAY HAVE TO THE VENUE OF
SUCH COURTS. LESSEE HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY
ACTION BROUGHT ON OR WITH RESPECT TO THIS LEASE. Any action by Lessee against
Lessor for any cause of action relating to this Lease shall be brought within
one year after any such cause of action first arises.
Executed and delivered by duly authorized representatives of the parties hereto
as of the date set forth below.
DATED AS OF: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
---------------------------- ---------------------------
Name: Name: Michael B. Sullivan
-------------------------- -------------------------
Title: Title: President
-------------------------- -------------------------
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<PAGE>
ADDITIONAL SECURITY AGREEMENT
SECURED PARTY: FLEET CAPITAL CORPORATION DEBTOR: FLEX PRODUCTS, INC.
50 Kennedy Plaza 1402 Mariner Way
Providence, Rhode Island 02903-2305 Santa Rosa, CA 95407
1. Grant of Security Interest. The undersigned Debtor hereby grants
to Secured Party and its successors and assigns, a continuing security interest
in the Collateral (hereinafter defined) to secure the due and punctual payment
and performance of all of the Obligations (hereinafter defined) to an amount not
to exceed $5,000,000. As used herein, the term "Obligations" shall mean and
include the following: (a) all of Debtor's obligations under that certain Master
Equipment Lease Agreement No. 32089 dated as of June 19, 1996, to Secured Party
(the "Agreement"); and (b) all obligations contained herein and. As used herein,
the term "Collateral" shall mean and include the property described on the
Additional Collateral Schedule attached hereto, whether now owned or hereafter
acquired and wherever the same may be located, and all present and future
additions, attachments, or accessories thereto and replacements thereof, and the
proceeds therefrom or thereof, including proceeds in the form of goods,
accounts, chattel paper, documents, instruments and general intangibles,
insurance proceeds payable in respect of loss or damage to any such property.
All capitalized terms used herein and not defined herein shall have the meanings
set forth or referred to in the Agreement. To the extent not otherwise defined
in this Additional Security Agreement, all other terms contained in this
Additional Security Agreement shall have the meanings assigned or referred to
them in the Uniform Commercial Code in force in the State of Rhode Island (the
"UCC").
2. Additional Documents and Aqreements. Debtor will, at the request
of Secured Party, execute, deliver, and permit Secured Party to file and record
any financing statement, specific assignment or other paper that may be
reasonably requested by Secured Party in order to create, preserve, perfect or
validate any security interest hereunder or to enable Secured Party to exercise
and enforce its rights hereunder with respect to any of the Collateral, Debtor
hereby appoints Secured Party as Debtor's attorney-in-fact to execute, sign and
file such additional financing statements as Secured Party may determine in its
sole discretion to be necessary or desirable to protect Secured Party's interest
in the Collateral. Debtor hereby authorizes Secured Party to file and record any
carbon, photographic or other reproduction of this Additional Security Agreement
or any financing statement executed and delivered in connection with this
Additional Security Agreement, which shall for all purposes be deemed to be
sufficient as a financing statement hereunder. The security interest granted
hereby shall continue effective irrespective of any retaking and redelivery of
Collateral to Debtor until all Obligations secured hereby are fully paid or
performed. The Collateral is and shall remain personal property even though all
or any portion of the Collateral may hereafter become attached or affixed to
real property, and Debtor shall provide Secured Party with disclaimers and
waivers from landlords, mortgagees or any other persons holding any interest in
the real property where any Collateral may be located, acceptable in all
respects to Secured Party, which may be necessary or advisable in the sole
discretion of Secured Party to confirm that the security interest and rights of
Secured Party in the Collateral are and will remain valid against all other
Parties.
3. Representations; Warranties; Covenants and Aqreements. For so
long as any Obligations shall remain outstanding, Debtor hereby represents,
warrants, covenants and agrees that: (a) this Additional Security Agreement and
all related documentation has been and shall be duly authorized by all necessary
action on the part of Debtor consistent with its form of organization, do not
and shall not require any further shareholder or partner approval, or require
the approval of, or the giving of notice to, any federal, state, local or
foreign governmental authority and shall not contravene any law binding on
Debtor or contravene any certificate or articles of incorporation or by-laws or
partnership certificate or agreement, or any agreement, indenture, or other
instrument to which Debtor is a party or by which it may be bound; (b) Debtor
shall lawfully possess and own the Collateral; (c) except for the security
interest granted hereby, the Collateral is free from and will be kept free from
all liens, claims, security interests, attachments and encumbrances, and that no
financing statement covering the Collateral or any proceeds thereof shall be on
file in favor of anyone other than Secured Party; (d) Debtor will not misuse,
fail to keep in good repair, sell, assign, rent, lend, encumber, transfer,
secrete or otherwise dispose of any of the Collateral or any interest therein,
nor permit or contract to do any such act, except that Debtor may dispose of
inventory in the ordinary course of business as heretofore conducted by Debtor;
(e) if any Collateral becomes the subject of any instrument, chattel paper,
negotiable document of title, including any warehouse receipt or bill of lading,
Debtor shall deliver such instrument, paper or document to Secured Party; (f)
Debtor shall defend at Debtor's own cost any action, proceeding or claim
affecting the Collateral; (g) Debtor shall pay promptly all taxes, assessments,
license fees and other public or private charges when levied or assessed against
the Collateral; (h) Debtor shall permit Secured Party at any time during normal
business hours to examine and inspect the Collateral and to inspect and make
abstracts from records of Debtor concerning the Collateral; (i) Debtor shall
furnish Secured Party such information and reports regarding the status,
condition and location of the Collateral and the financial condition of Debtor
as Secured Party may from time to time reasonably request; (j) if a certificate
of title be required or permitted by law with respect to any Collateral, Debtor
shall obtain such certificate and all related lien registration and notation
documentation with respect to the Collateral indicating the security interest of
Secured Party thereon, and in any event do everything necessary or expedient to
preserve or perfect the security interest of Secured Party in such Collateral;
(k) Debtor shall promptly notify Secured Party of any event causing a
substantial loss or diminution in the value or functional utility of all or any
material part of the Collateral, or affecting Secured Party's rights or remedies
hereunder with respect to the disposition of all or any material part of the
Collateral; (1) Debtor shall promptly and diligently collect all accounts and
rights to receive payment for goods sold or leased, or for services rendered
(whether or not evidenced by an instrument or chattel paper) which constitute
all or any part of the Collateral ("Accounts") and maintain accurate books and
records of such Accounts and all collections thereof; and (m) Debtor shall keep
its records concerning the Accounts at Debtor's chief executive offices at the
address shown above, or at such other address as Secured Party shall approve in
writing. For so long as any Obligations shall remain outstanding, Debtor shall:
(i) segregate all collections, Accounts and proceeds of the Collateral so that
they are capable of identification and deliver such collections, Accounts and
proceeds to Secured Party immediately upon demand therefor; (ii) obtain Secured
Party's prior written consent to any sale, contract of sale or other disposition
of the Collateral; (iii) upon Secured Party's request therefor, notify account
debtors, purchasers of the Collateral or any other persons of the security
interest created hereby; and (iv) upon Secured Party's request therefor, demand
and collect any Accounts and any proceeds of the Collateral from persons owing
same. Debtor hereby irrevocably authorizes Secured Party to endorse Debtor's
name on all collections, receipts, instruments or other documents, and appoints
Secured Party as Debtor's attorney-in-fact to exercise to the extent permitted
by law all powers, rights and remedies necessary to enable Secured Party to
exercise its rights hereunder.
4. Insurance. All risk of loss of, damage to, or destruction of,
the Collateral shall at all times be with Debtor. Debtor will procure forthwith
and maintain fire, theft and property damage insurance with extended or combined
additional coverage on any Collateral which is tangible personal property for
the full replacement value thereof for so long as any Obligations remain
outstanding, together with such other insurance as Secured Party may reasonably
specify, and promptly deliver certificates and copies evidencing each policy to
Secured Party with a standard mortgagee's long form endorsement attached showing
loss payable to Secured Party and Debtor as their respective interests may
appear, which endorsement shall provide at least thirty (30) days' prior written
notice to Secured Party of any material change, cancellation or non-renewal of
coverage. Secured Party's acceptance of policies in lesser amounts or risks
shall not be a waiver of Debtor's foregoing obligations.
5. Defaults. Time is of the essence in the payment and performance
of all Obligations, including without limitation all Obligations under or in
respect of this Additional Security Agreement. It shall be an "Event of Default"
hereunder if (i) an Event of Default under the Agreement shall occur, (ii)
Debtor breaches any representation, warranty, covenant or provision hereof, and
such breach continues for ten (1O) days after notice thereof to Debtor,
Page 1 of 2
<PAGE>
provided, however, that no such breach shall constitute an Event of Default
hereunder where Debtor has commenced curing such breach within such ten (1O) day
period and continues to diligently pursue such cure in the opinion of Secured
Party; or (iii) any Collateral is lost or destroyed.
6. Remedies. Upon the occurrence of an Event of Default hereunder,
all Obligations, at Secured Party's option and without notice, shall become
immediately due and payable, and Secured Party shall have all rights and
remedies of a secured party under the UCC and any other applicable law, and in
addition, and without limiting the foregoing, Secured Party may: (a) sell all or
any part of the Collateral at public or private sale at such price(s) as Secured
Party may deem satisfactory; (b) require Debtor to assemble all or any part of
the Collateral and any records pertaining thereto and make it available to the
Secured Party at a place to be designated by the Secured Party; (c) enter the
premises of Debtor and take possession of the Collateral and any records
pertaining thereto and/or disable or render any such Collateral unusable; (d)
grant extensions, compromise claims and settle Accounts in any amount for less
than face value or book value or otherwise without prior notice to Debtor. All
rights and remedies in this Additional Security Agreement are cumulative and not
alternative and are not exclusive of any other remedies provided by law. Debtor
will upon demand pay to Secured Party the expenses of retaking, holding,
preparing for sale, selling and the like, including without limitation,
reasonable attorney's fees and other legal expenses, incurred by Secured Party
in connection with the Collateral or the exercise of its rights or remedies
hereunder, all of which shall constitute additional Obligations secured by the
Collateral hereunder. In the event Secured Party seeks to take possession of any
or all of the Collateral by court process, Debtor hereby irrevocably waives any
bonds and any surety or security relating thereto required by any statute, court
rule or otherwise as an incident to such possession, and waives any demand for
possession prior to the commencement of any suit or action to recover with
respect thereto. Any notice required to be given by Secured Party of a sale or
other disposition or other intended action by Secured Party with respect to any
of the Collateral or otherwise which is made in accordance with the terms of
this Additional Security Agreement at least five (5) days prior to such proposed
action, shall constitute fair and reasonable notice to Debtor of any such
action. Secured Party shall be liable to Debtor only for its gross negligence or
willful misconduct in failing to comply with any applicable law imposing duties
upon Secured Party; Secured Party's liability for any such failure shall be
limited to the actual loss suffered by Debtor directly resulting from such
failure. Secured Party shall have no liability to Debtor in tort or for
incidental or consequential damages.
7. Assignment. The provisions of this Additional Security Agreement
shall be binding upon and shall inure to the benefit of the heirs,
administrators, successors and assigns of Secured Party and Debtor, provided,
however, that Debtor may not assign any of its rights or delegate any of its
Obligations hereunder without the prior written consent of Secured Party.
Secured Party may, from time to time, without notice to Debtor, sell, assign,
transfer, participate, pledge or otherwise dispose of all or any part of the
Obligations and/or the Collateral therefor. In such event, each and every
immediate and successive purchaser, assignee, transferee, participant, pledgee,
or holder of all or any part of the Obligations and/or the Collateral (each, a
"Holder") shall have the right to enforce this Additional Security Agreement, by
legal action or otherwise, for its own benefit as fully as if such Holder were
herein by name specifically given such rights hereunder. Debtor agrees that the
rights of any such Holder hereunder or with respect to the related Obligations
shall not be subject to any defense, set-off or counterclaim that Debtor may
assess or claim against Secured Party, and that any such Holder shall have all
of the Secured Party's rights hereunder but none of the Secured Party's
obligations. Secured Party shall have an unimpaired right to enforce this
Additional Security Agreement for its benefit with respect to that portion of
the Obligations which Secured Party has not sold, assigned, transferred,
participated, pledged or otherwise disposed of.
8. Miscellaneous. No failure on the part of Secured Party to
exercise and no delay in exercising any right, power or remedy hereunder shall
operate as a waiver thereof. Any provisions hereof contrary to, prohibited by or
invalid under applicable laws or regulations shall be inapplicable and deemed
omitted here from, and shall not invalidate the remaining provisions hereof.
Debtor acknowledges receipt of a true copy and waives acceptance hereof. THIS
ADDITIONAL SECURITY AGREEMENT TOGETHER WITH THE AGREEMENT AND THE DOCUMENTS
EXECUTED IN CONNECTION THEREWITH CONSTITUTES THE ENTIRE AGREEMENT OF DEBTOR AND
SECURED PARTY RELATIVE TO THE SUBJECT MATTER HEREOF, AND THERE ARE NO PRIOR OR
CONTEMPORANEOUS UNDERSTANDINGS OR AGREEMENTS, WHETHER ORAL OR IN WRITING,
BETWEEN THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF. NEITHER
THIS ADDITIONAL SECURITY AGREEMENT NOR ANY PROVISION HEREOF MAY BE CHANGED,
WAIVED, DISCHARGED OR TERMINATED EXCEPT BY AGREEMENT IN WRITING SIGNED BY THE
PARTY AGAINST WHICH ENFORCEMENT OF SUCH CHANGE, WAIVER, DISCHARGE OR TERMINATION
IS SOUGHT. Any notices and demands shall be in writing and sent to the parties
by regular mail at the addresses herein set forth or to such other address as
the parties may hereafter specify by written notice. THIS ADDITIONAL SECURITY
AGREEMENT AND THE LEGAL RELATIONS OF THE PARTIES HERETO SHALL IN ALL RESPECTS BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF RHODE
ISLAND, WITHOUT REGARD TO PRINCIPLES REGARDING THE CHOICE OF LAW. DEBTOR HEREBY
CONSENTS TO THE JURISDICTION OF THE COURTS OF THE STATE OF RHODE ISLAND AND
CALIFORNIA, AND THE FEDERAL DISTRICT COURT FOR THE DISTRICT OF RHODE ISLAND AND
THE NORTHERN DISTRICT OF CALIFORNIA FOR THE PURPOSES OF ANY SUIT, ACTION OR
OTHER PROCEEDING ARISING OUT OF ITS OBLIGATIONS HEREUNDER AND EXPRESSLY WAIVES
ANY OBJECTIONS TO THE VENUE OF SUCH COURTS. DEBTOR HEREBY EXPRESSLY WAIVES TRIAL
BY JURY IN ANY ACT1ON BROUGHT ON OR WITH RESPECT TO THIS ADDITIONAL SECURITY
AGREEMENT. Any action by Debtor against Secured Party for any cause of action
relating to this Additional Security Agreement shall be instituted within one
year after any such cause of action first arise.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
---------------------------- ---------------------------
Name: Name: Michael B. Sullivan
-------------------------- -------------------------
Title: Title: President
-------------------------- -------------------------
Page 2 of 2
<PAGE>
FLEET CAPITAL CORPORATION PAGE 1 OF 3
ADDITIONAL COLLATERAL SCHEDULE
Attached to and made part of the following documents: Additional Security
Agreement dated as of: June 19, 1996 and UCC Financing Statement(s) with Flex
Products, Inc.
The Equipment is currently located at: 2793 Northpoint Parkway
Santa Rosa, California 95407
BETA ONE
Unit Number: Beta I
(1) Leybold Hereaus electron beam roll coater, model Al600B30, Mfg. 1979, 52"
width capacity, 3 meters per second, 480 volt, 3 phase, 122 Amps., Serial Number
31419342, which machine includes, but is not limited to, the following:
(12) 30KW electron beam guns with power supplies, model D2D4
(3) Polycolds, model PFC1PFC00ST
(6) Diffusion pumps, 20" water cooled
(12) Electron gun controllers
Winding Cabinet
(12) Hewlett Packard 6253A dual DC power supplies, 0-200 volt, 3 amps
(5) Leybold Hereaus vacuum motors, model PENNINGVAC PM 41152
(4) Leybold Hereaus vacuum motors, model THERMOVPC TM 22052
Viewing port holes
Residual gas analyzers electron monitoring system, model QUADREX 200
Meters
Control Cabinets
Catwalk and platform around machine
Hi-resolution RAD monitoring system
Winding shafts and chucks
Sputtering power supply
63 X 15 Target
Web drives
Plate lifter
(6) Leybold Hereaus turbo pumps, model 1000C
(4) Stokes vacuum pumps, model 412-11
(2) Leybold Hereaus blowers, model RA7001S
(4) Genvin portable oil filters
Glow power supply
(6) Filter amplifier chassis
(2) Water cooled shield sets
Sputtering targets
Desktop computer
Monitors with exception of proprietary plasma emission and optical monitor
Pressure controllers
Heco-Pacific crane
<PAGE>
PAGE 2 OF 3
ADDITIONAL COLLATERAL SCHEDULE
BETA TWO
Unit Number: Beta II
(l) Leybold Hereaus sputtering roll coater, Mfg. 1987, 54" width capacity,
overall size approximately 16' X 12' X 12', 480 volt, 3 phase, Serial Number
58073044, which machine includes, but is not limited to, the following:
(2) polycolds, model PFC65011ST
(8) 8 X 54 sputtering targets with (8) SSV sputtering power supplies, serial
numbers are MCC3K1-2, MCC3K3-4, MCC3I1-2, MCC3I3-4, MCC3G1-2, MCC3G3-4,
MCC3F1-2, MCC3F3-4
(2) Cryo-pumps
Neslab chiller, model RTE-110
(8) 90 Kilowatt breaker boxes
(8) Systron Donner 0-60 VDC, 0-100 amp. power supplies
(21) Leybold Hereaus turbo pumps, model 1000G
(2) Leybold Hereaus blower station, model WAV2000
(3) Leybold Hereaus pumps, model S250-C
Leybold Hereaus blower, model RUVAC, type WPV 251
(2) Balston filters, model R1680
Leybold Hereaus blower, model RUVAC, type 70001S
Cooling Tower
(4) Anode power supplies
(4) Glow discharge power supplies
Allen Bradley controls, PLC-30
Herbert Schuller chilling system with tower
(4) Optical monitoring devices
Transformers
Motor controls
Sheet resistance monitor
Safety platform with stairs
(2) Target backing plates
(2) Analog controllers
(2) 50/50 tooling
Turbo lifting fixture
(43) sets of shields
Gas handling system
Cathode system
Overhead trolley with crane
(7) Spare Titanium targets
(5) Zircon targets
(6) Long shields
<PAGE>
PAGE 3 OF 3
ADDITIONAL COLLATERAL SCHEDULE
The Equipment is Currenty Located at: 1402 Mariner Way
Santa Rosa, California 95407
BETA THREE
(2) Bell & Gossett pumps, models 11RC925 series 1510, serial numbers 1955297
and 1955296 Raven polypro tank, approximately 5' X 2' diameter
Raven polypro tank, approximately 5' X 2' diameter
(2) Bell & Gossett pumps, models 4BC9375, serial numbers 1957959 and 1957960,
625 GPM
Alfa laval heat exchanger, type M6-FG, serial number 3010286368 with (4)
0-150 degree gauges
Alfa laval heat exchanger, type MIO-BFG, serial number 3010286389 with (4)
0-150 degree gauges
FSI water filter, model FSP-40N-30455, Mfg. 1995, 10 micron with 0-160 PSI
gauge
Dual water cooling condensing system, low pressure, high pressure with (2)
KSB pumps, model ETACHROMB, valves, so1enoids
(2) Edwards two stage vacuum pumps, model 275
Air storage tank 4' X 2' diameter with 0-160 PSI guage
Water filter system with (2) KSB ETACHROM-B-40160562, pumps, 2200 gallon
round stainless steel tank, model BT33541
Approximately 60' X 4" stainless steel piping with fittings
Approximately 100' X 2" stainless steel piping with fittings
BETA FIVE
WPH overhead wire rope crane, model 1 l/2 ton, serial number W6022015,
approximately X-Y, travel is 55' X 35' X 40'
Kinney vacuum rotary pump, model KT-505-LP, serial number 3011-2 with a
dresser roots booster blower, 15HP, model HV3000, serial number H00224, 480
volts
Kinney vacuum rotary pump, model KT-505-LP, serial number 3011-1 with a
dresser roots booster blower, 15HP, model HV3000, serial number H00219
Dresser roots, 30MP booster pump
(4) Emergency isolation switches
(3) 5.5 Bar pneumatic actuator valves
Solenoids
Alfa laval heat exchanger, Mfg. 1995, serial number 3010286367
(4) Weksler temperature gauges, 0-150 degrees Fahrenheit
Raven round polypro storage tank, approximately 6' X 4' diameter, serial
number G333465
Approximately 60 feet of 4" 304 stainless steel seamless piping with
connectors
(2) ITT Bell & Gossett pumps, series 1510, 20 HP, 200 GPM, model
21/2AB7000BF, serial numbers 1955295 and 1955296
(2) FSI filter columns, stainless steel, Mfg. 1995, 10 micron filters, serial
numbers 38121, 150 PSI
Air storage tank 4' X 2' diameter with a 0-160 PSI gauge
Miscellaneous spare parts
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
BY: BY: /s/ Michael B. Sullivan
-------------------------------- --------------------------------
NAME: NAME: Michael B. Sullivan
------------------------------ ------------------------------
TITLE: TITLE: President
----------------------------- -----------------------------
<PAGE>
[LOGO] Fleet LEASE SCHEDULE NO. 32089-00001
Capital Leasing (True Lease Schedule)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
Lessee: FLEX PRODUCTS, INC.
Address: 1402 MARINER WAY
SANTA ROSA, CA 95407
1. This Lease Schedule No. 32089 - 00001 dated as of June 19, 1996 is
entered into pursuant to and incorporates by this reference, all of the terms
and provisions of that certain Master Equipment Lease Agreement No. 32089 dated
as of JUNE 19, 1996 (the "Master Lease"), for the lease of the Equipment
described in Schedule A attached hereto. This Lease Schedule shall constitute a
separate, distinct and independent lease of the Equipment and the contractual
obligation of Lessee. References to the "the Lease" or "this Lease" shall mean
and refer to this Lease Schedule, together with the Master Lease and all
exhibits, addenda, schedules, certificates, riders and other documents and
instruments executed and delivered in connection with this Lease Schedule, all
as the same may be amended or modified from time to time. All capitalized terms
used herein and not defined herein shall have the meanings set forth or
referred to in the Master Lease. By its execution and delivery of this Lease
Schedule, Lessee hereby reaffirms all of the representations, warranties and
covenants contained in the Master Lease, as of the date hereof, and further
represents and warrants to Lessor that no Event of Default, and no event or
condition which with notice or the passage of time or both would constitute an
Event of Default, has occurred and is continuing as of the date hereof.
2. ACQUISITION COST. The Acquisition Cost of the Equipment is:
$7,879,000.00.
3. (a) LEASE TERM. The Lease Term shall commence on the date hereof and
shall continue for a period of 72 months after the Lease Term Commencement Date
set forth in the Acceptance Certificate to this Lease Schedule, plus any renewal
or extended term applicable in accordance with the terms of the Lease.
(b) RENTAL PAYMENTS. In addition to interim rent payable pursuant
to Section 2 of the Master Lease, Lessee shall pay Lessor 72 consecutive Rental
Payments in the amounts set forth in the schedule below, plus any applicable
sales/use taxes, commencing on the Rental Payment Commencement Date set forth
in the Acceptance Certificate and MONTHLY thereafter for the remaining Lease
Term. Each Rental Payment shall be payable on the same day of the month as the
Rental Payment Date in each succeeding rental period during the remaining Lease
Term (each, a "Rental Payment Date"):
Amount of Each
Number of Rental Payments Rental Payment
------------------------- --------------
12 113,999.91
60 129,180.78
(c) ADVANCE RENTAL PAYMENT. Lessee agrees to pay Lessor the first
01 and last O Rental Payments, due and payable on the Acceptance Date.
<PAGE>
(d) SECURITY DEPOSIT. Lessee agrees to make a payment in an amount
equal to 0% of the Acquisition Cost of the Equipment, due and payable on the
Acceptance Date, to be held by Lessor as a non-interest bearing deposit to
secure Lessee's performance under the Lease.
4. EQUIPMENT LOCATION(S). The Equipment will be located at the
location(s) specified in Schedule A-1 hereto.
5. Lessor will invoice Lessee for all sales, use and/or personal
property taxes as and when due and payable in accordance with applicable law,
unless Lessee delivers to Lessor a valid exemption certificate with respect to
such taxes. Delivery of such certificate shall constitute Lessee's
representation and warranty that no such taxes shall become due and payable with
respect to the Equipment and Lessee shall indemnify and hold harmless Lessor
from and against any and all liability or damages, including late charges and
interest which Lessor may incur by reason of the assessment of such taxes.
6. The Rental Payments may change for Equipment accepted after
June 19, 1996.
7. Lessee represents that the applicable recovery period for the
Equipment, for purposes of Section 168 of the Internal Revenue Code of 1986, is
as set forth in Schedule A hereto.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
ACCEPTANCE CERTIFICATE
[LOGO] Fleet
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Acceptance Certificate (this "Acceptance Certificate") is attached
to and made a part of that certain Lease Schedule No. 32089 - 00001, dated as of
June 19, 1996 (the "Lease Schedule"), by and between the undersigned parties.
All capitalized terms used herein and not defined herein shall have the meanings
set forth or referred to in the Lease Schedule. To the extent the terms set
forth in this Acceptance Certificate differ or conflict with any of the terms
set forth in the Lease, the terms set forth in this Acceptance Certificate shall
control.
1. Lessee acknowledges and agrees that each item of Equipment set forth
on Schedule A hereto (collectively, the "Equipment") is hereby unconditionally
accepted by Lessee for all purposes under the Lease at the locations specified
in Schedule A-1 hereto, and hereby agrees to faithfully perform all of its
obligations under the Lease as of the date hereof (the "Acceptance Date").
Lessee hereby authorizes and directs Lessor to make payment to each vendor of
the Equipment pursuant to such vendor's invoice or any purchase order, purchase
agreement or supply contract with such vendor, receipt and approval of which are
hereby reaffirmed by Lessee.
2. By its execution and delivery of this Acceptance Certificate, Lessee
hereby reaffirms all of the representations, warranties and covenants contained
in the Lease as of the date hereof, and further represents and warrants to
Lessor that no Event of Default, and no event or condition which with notice or
the passage of time or both would constitute an Event of Default, has occurred
and is continuing as of the date hereof. Lessee further certifies to Lessor that
Lessee has selected the Equipment and has received and approved the purchase
order, purchase agreement or supply contract under which the Equipment will be
acquired for all purposes of the Lease.
3. Lessee hereby represents and warrants that: (a) the Equipment has been
delivered and is in an operating condition and performing the operation for
which it is intended to the satisfaction of the Lessee; and (b) if requested by
Lessor, the Equipment has been marked or labeled evidencing the Lessor's
interest therein.
4. The LEASE TERM COMMENCEMENT DATE is the 10th day of July, 1996
5. The RENTAL PAYMENT COMMENCEMENT DATE is the 10th day of July, 1996
6. All terms and provisions of the Lease Schedule shall remain in full force and
effect, except as otherwise provided below:
- ACQUISITION COST: $7,879,000.00.
- LEASE TERM: (72) seventy-two months.
- RENTAL PAYMENTS: Number of Rental Payments Rental Payment Amount
12 $_________
60 $_________
- ADVANCE RENTAL PAYMENT(S): First 01 and last 00.
- SECURITY DEPOSIT: N/A %.
Dated: July 10, 1996
Agreed and Accepted:
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
---------------------------- ---------------------------
Name: John J. Gould Name: Michael B. Sullivan
-------------------------- -------------------------
Title: VP/Senior Lender Title: President
-------------------------- -------------------------
<PAGE>
FLEET CAPITAL CORPORATION PAGE 1 OF 1
SCHEDULE A EQUIPMENT
Attached to and made part of the following documents: True Lease Schedule No.
32089-01, Acceptance Certificate, UCC Financing Statement(s), and Warranty Bill
of Sale with Flex Products, Inc.
The Depreciable Life of the Property is (07) seven years.
LOC# (01)
BETA THREE
Unit Number: Beta III
(1) Weinert Vacuum GMBH, sputtering roll coating machine, Mfg. 1995, 7' X 10'
chamber size, 480 volt, 3 phase, all stainless stee1 construction Serial Number
FBR 1400 SP-SC-001, which machine includes, but is not limited to, the
following:
(6) 20" diffusion pumps
(4) 16" diffusion pumps
3 Chamber system
Liebert UPS battery back-up system, model AP441, serial number P21174SE
(3) Polycoid cooling systems, model PFC-1100ST
(3) Cathodes
(2) Aluminum evaporation systems
(6) Transformers, 72 kilowatt
Edwards two stage vacuum pump, model 275
(3) Edwards two stage vacuumm pumps, model 8O
(3) ENI D.C. Plasma generators, model DCG-100 zokw/ea
Siemens PLC
(1) Nemonic Display
(2) Control Stations
(1) PLC
(2) Machine state actuators
Circulation pumps
Hydraulic pumps
AND ALL STANDARD AND ACCESSORY EQUIPMENT
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
BY: /s/ John J. Gould BY: /s/ Michael B. Sullivan
---------------------------- ---------------------------
NAME: John J. Gould NAME: Michael B. Sullivan
-------------------------- -------------------------
TITLE: VP/Senior Lender TITLE: President
-------------------------- -------------------------
<PAGE>
FLEET CAPITAL CORPORATION Schedule A-1
Equipment Location
Attached to and made part of the following documents True Lease Schedule No.
32089-01, Acceptance Certificate, UCC Financing Statement(s), Warranty Bill of
Sale with Flex Products, Inc.
- --------------------------------------------------------------------------------
Loc # Equipment Currently Located at:
- --------------------------------------------------------------------------------
01 1402 Mariner Way, Santa Rosa, California 95407
- --------------------------------------------------------------------------------
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
[LOGO] Fleet STIPULATED LOSS VALUE SCHEDULE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Stipulated Loss Value Schedule (this "Schedule") is attached to
and made a part of that certain Lease Schedule No. 32089-00001, dated as of June
19, 1996 (the "Lease Schedule"), by and between the undersigned parties.
<TABLE>
The following Stipulated Loss Values shall be used to calculate damages
or loss as provided in the Master Lease. The Stipulated Loss Value with respect
to any item of Equipment on any Rental Payment Date during the Lease Term shall
be an amount equal to the sum of: (a) all Rental Payments and other amounts then
due and owing to Lessor under the Lease, together with all accrued interest and
late charges thereon, calculated through and including the date of payment; plus
(b) the product of the Acquisition Cost of the such Equipment multiplied by the
percentage set forth below as of such Rental Payment Date.
<CAPTION>
<S> <C> <C> <C>
Rental Payment Date for Percentage of Rental Payment Date for Percentage of
Rental Payment Number Acquisition Cost Rental Payment Number Acquisition Cost
</TABLE>
SEE EXHIBIT C ATTACHED HERETO AND MADE A PART HEREOF
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
EXHIBIT C
TO
STIPULATED LOSS VALUE SCHEDULE
TO LEASE SCHEDULE NO. 32089-01
RENTAL PAYMENT PERCENTAGE OF RENTAL PAYMENT PERCENTAGE OF
DATE FOR RENTAL ACQUISITION COST DATE FOR RENTAL ACQUISITION COST
PAYMENT NUMBER PAYMENT NUMBER
37 70.90880090
1 103.35121715 38 69.75511355
2 102.77715752 39 68.59002020
3 102.19526265 40 67.41874422
4 101.59552206 41 66.23597391
5 100.98781724 42 65.04165152
6 100.37210821 43 63.84099969
7 99.73838360 44 62.62870597
8 99.09652408 45 61.40471189
9 98.44648879 46 60.16895869
10 97.78823666 47 58.92972240
11 97.11575495 48 57.67865042
12 96.43494366
49 56.42401842
13 95.54711438 50 55.15747340
14 94.34921445 51 53.87895553
15 93.74119331 52 52.59673978
16 92.81702863 53 51.30247247
17 91.88261080 54 49.99609306
18 90.93788832 55 48.68587582
19 89.97683797 56 47.36346638
20 89.00534921 57 46.02880349
21 88.02336959 58 44.68182560
22 87.03084644 59 43.33120369
23 86.02873119 60 41.96818663
24 85.01597126
61 40.60144498
25 83.99351758 62 39.22222721
26 82.96031708 63 37.83047065
27 81.91631576 64 36.43484516
28 80.86246378 65 35.02659847
29 79.79770726 66 33.60566720
30 78.72199142 67 32.18072044
31 77.63626563 68 30.74300521
32 76.53947521 69 29.29245738
33 75.43156457 70 27.82901249
34 74.31247787 71 26.37095856
35 73.18743961 72 24.89996987
36 72.05113926
72 25.00000000
<PAGE>
[LOGO] Fleet PURCHASE OPTION RIDER
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (this "Rider") is attached to and made a
part of that certain Lease Schedule No. 32089-00001, dated as of June 19, 1996
(the "Lease Schedule"), by and between the undersigned parties.
If no Event of Default (or event or condition which, with the passage
of time or giving of notice, or both, would become such an Event of Default)
shall have occurred and be continuing, and the Lease shall not have been earlier
terminated, Lessee shall have the option to purchase (the "Purchase Option")
all, but not less than all, of the Equipment at the expiration of the Lease Term
for an amount, payable in immediately available funds on the last day of the
Lease Term, equal to: (a) all Rental Payments, late charges and other amounts
due and owing under the Lease; plus (b) all taxes, assessments and other charges
due or payable in connection with the sale of the Equipment to Lessee; plus (c)
an amount equal to 25.00000% of the Acquisition Cost of the Equipment, which
Lessor and Lessee acknowledge represents a reasonable current estimate of the
fair market value of the Equipment at the end of the Lease Term.
Provided that Lessor shall have received all amounts payable hereunder
on the last day of the Lease Term, and that no Event of Default then exists and
is continuing under the Lease, Lessor shall convey all of its right, title and
interest in and to the Equipment to Lessee on the last day of the Lease Term, on
an "AS-IS," "WHERE-IS" BASIS WITHOUT REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, and without recourse to Lessor, except that the Equipment shall be free
and clear of all liens created by Lessor. If Lessee intends to exercise the
Purchase Option, Lessee shall give irrevocable written notice to Lessor (the
"Option Notice") not more than 240 days, nor less than 180 days, prior to the
expiration of the Lease Term. If Lessee fails to give such written notice to
Lessor, it shall be conclusively presumed that Lessee has elected not to
exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 5.0% of the Acquisition Cost of the
Equipment.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
[LOGO] Fleet WARRANTY BILL OF SALE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903
FLEX PRODUCTS, INC., ("Seller") of 1402 MARINER WAY SANTA ROSA, CA
95407, in consideration of the sum of $7,879,000.00 Dollars, and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, does hereby sell, transfer and assign to Fleet Capital Corporation
("FCC") a Rhode Island corporation having its principal office at 50 Kennedy
Plaza, Providence, Rhode Island 02903, the equipment set forth in Schedule A
hereto (the "Equipment").
Seller hereby covenants with and warrants to FCC that Seller is the
lawful owner of the Equipment and has the right to sell the Equipment, and that
the Equipment is free and clear of all rights, claims, liens, charges, security
interests or encumbrances of any other person. Seller will forever indemnify,
defend and warrant all of the rights of FCC in and to the Equipment transferred
hereunder against the claims and demands of all other persons.
IN WITNESS WHEREOF, Seller has duly executed this Bill of Sale this 11th day of
July, 1996.
FLEX PRODUCTS, INC.
By: /s/ Michael B. Sullivan
--------------------------------
Name: Michael B. Sullivan
------------------------------
Title: President
-----------------------------
State of California
--------------------------
County of Sonoma
--------------------------
Subscribed and sworn before me this 11th day of July, 1996.
/s/ Aggie S. Navarro
Notary Public
My Commission expires:____________________
==============================
AGIE S. NAVARRO
[SEAL] COMM. #1009257
Notary Public--California
SONOMA COUNTY
My Comm. Expires NOV 11, 1997
==============================
<PAGE>
[LOGO] Fleet PAY PROCEEDS LETTER
Credit Corporation
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
We hereby authorize you to pay the following Payee(s) from the proceeds of
your financial accommodations to us in respect of that certain True Lease
Schedule No. 32089-00001 dated as of June 19, 1995, and make disbursements
directly to said Payee(s) as follows:
Amount of
PAYEE Payment
Flex Products, Inc. $ 7,765,000.09
- ---------------------------------------------------- -------------------------
Fleet Capital Corporation (short fund to pay 113,999.91
- ---------------------------------------------------- -------------------------
Customer Invoice now due)
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
TOTAL: $ 7,879,000.00
-------------------------
Dated as of: June 19 , 1996
------------------------
* BANK: Bank of America, NTSA FLEX PRODUCTS, INC.
10 Santa Rosa Ave.
Santa Rosa, CA By: /s/ Michael B. Sullivan
---------------------------
ABA #: 12100358 Name: Michael B. Sullivan
-------------------------
For Account of: FLEX PRODUCTS INC. Title: President
-------------------------
Account #: 14984-00242
<PAGE>
FLEET CAPITAL CORPORATION
50 Kennedy Plaza
Providence, RI 02903-2305
1-800-238-3737
FLEX PRODUCTS, INC.
1402 MARINER WAY
SANTA ROSA CA 95407-0000
July 11, 1996
- --------------------------------------------------------------------------------
DESCRIPTION AMOUNT
- --------------------------------------------------------------------------------
ADVANCE PAYMENT $113,999.91 +
SH FUND $113,999.91 -
Total Due $113,999.91
Total Received $113,999.91
Balance $0.00
- --------------------------------------------------------------------------------
RETURN YOUR REMITTANCE TO THE ATTENTION OF: SANDRA BUONAIUTO
TO INSURE PROPER CREDIT TO YOUR ACCOUNT, PLEASE RETURN REMITTANCE COPY.
A Subsidiary of Fleet National Bank
32089 00 001 00001
<PAGE>
FLEET CREDIT CORPORATION
CONSENT AND WAIVER
(OWNER, LANDLORD OR MORTGAGEE OF REAL ESTATE)
50 Kennedy Plaza
Providence, Rhode Island 02903
The undersigned, Aid Association for Lutherans, 4321 North Ballard Road
Appleton, Wisconsin 54919 is the owner, landlord or mortgagee of the premises
located at 1402 Mariner Way, Santa Rosa California 95407 (the "Premises") which
are occupied by Flex Products, Inc.
The undersigned acknowledges that Customer has leased or financed, or
that Customer expects to lease or finance from Fleet Credit Corporation ("FCC"),
the Equipment set forth on Schedule A hereto, including any accessories,
additions, substitutions or replacements therefor, which may from time to time
be located at the Premises. To induce FCC to enter into a lease or financing
agreement with Customer, the undersigned agrees with FCC as follows:
The undersigned waives any right, title or interest in or to the
Equipment that it may now or hereafter have. The undersigned
irrevocably agrees and consents that it will refrain from taking any
action to bar, restrain or otherwise prevent FCC, its agents,
successors or assigns, from entering the Premises for the purpose of
inspecting, removing or taking possession of the Equipment, and will
grant FCC, its agents, successors or assigns the right of entry to the
Premises to remove the Equipment at any reasonable time or times. FCC
shall be responsible for any damage to the Premises that FCC causes in
connection with its entry thereon and the removal of the Equipment
therefrom. The Equipment is and shall remain personal property,
notwithstanding the manner in which it may be installed or affixed to
the Premises.
This Consent and Waiver shall inure to the benefit of the successors
and assigns of FCC and shall be binding upon the heirs, representatives,
successors and assigns of the undersigned. The undersigned will, upon the
request and at the expense of FCC, execute and deliver to FCC such further and
additional documents as FCC may reasonably deem necessary or desirable to effect
waivers and consents contemplated hereby. This Agreement shall be governed by
and construed in accordance with the laws of the state in which the premises are
located, without reference to principles of conflict of laws.
IN WITNESS WHEREOF, the undersigned has duly executed this Consent and
Waiver this 18th day of April, 1996.
AID ASSOCIATION F0R LUTHERANS
/s/ Bonnie L. Hietpas By: /s/ Wayne C. Streck
- ------------------------ -----------------------------------------
(Witness) Wayne C. Streck
Title: Vice President-Mortgages & Real Estate
---------------------------------------
/s/ Janice A. Schuette By: /s/ Kenneth E. Podell
- ------------------------ -----------------------------------------
(Witness) Kenneth E. Podell
Assistant Secretary
<PAGE>
ACKNOWLEDGEMENT TO BE MADE BY OWNER,
LANDLORD OR MORTGAGEE OF REAL ESTATE
(Hereinafter referred to as "Undersigned")
[INDIVIDUAL)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this day ______ of ____________________, 19__ personally appeared before me
__________________________, Undersigned, in the foregoing Consent and Waiver, to
me personally well known and known to the person who signed said Consent and
Waiver, who, being by me duly sworn and being informed of the contents of said
Consent and Waiver stated and acknowledged on oath that he signed, executed,
sealed and delivered same as his free and voluntary act and deed, for the uses,
purposes and considerations therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(PARTNERSHIP)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this day ___________ of ____________________, 19__ personally appeared before me
___________________________ and _________________________________ who executed
the foregoing Consent and Waiver, to me personally well known and known to the
persons who signed said Consent and Waiver, and known to be and who, being by me
duly sworn and being informed of the contents of said Consent and Waiver stated
and acknowledged on oath that they were Partners of ____________________________
_______________________________________________________________________________,
the Partnership named in and which executed the said Consent and Waiver, and
that they signed, executed, sealed and delivered same individually and in behalf
of the said Partnership, with authority as their and its free and voluntary act
and deed for the uses, purposes and considerations therein mentioned and set
forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(CORPORATION)
STATE OF WISCONSIN
-----------------
SS.
COUNTY OF OUTAGAMIE
-----------------
I, David Crist, a Notary Public within and for said County, in the
State aforesaid, duly commissioned and acting, do hereby certify that on this
18th day of April, 1996 personally appeared before me Wayne C. Streck and
Kenneth E. Podell (Name of Signer for Undersigned), to me personally well known
and known to me to be the person who signed the foregoing Consent and Waiver,
and known to me to be and who, being by me duly sworn and being informed of the
contents of said Consent and Waiver stated and acknowledged on oath that they
are Vice President-Mortgages and Real Estate and Assistant Secretary of Aid
Association for Lutherans the Corporation named in and which executed the said
Consent and Waiver, and that he knows the corporate seal of said Corporation,
and that the seal affixed to said Consent and Waiver is the corporate seal of
said Corporation, that he was duly authorized to execute said Consent and
Waiver, for, in the name of and on behalf of said Corporation, and that same was
signed, sealed, executed and delivered by him in the name of and on behalf of
said Corporation by authority of its Board of Directors and that the execution
of said Consent and waiver was his free and voluntary act and deed in his said
capacity and acknowledged to me that said Corporation executed the same as its
voluntary act and deed and was by him voluntarily executed, on behalf of said
Corporation for the uses, purposes and considerations therein mentioned and set
forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires is permanent. /s/ David Crist
----------------- --------------------
(Notary Public)
(Seal)
<PAGE>
FLEET CREDIT CORPORATION PAGE 1 OF 3
Schedule A Equipment
Attached to and made part of the following documents Consent and Waiver (Owner,
Landlord or Mortgagee of Real Estate) with Flex Products, Inc. 32089-01 and
32089-02.
- --------------------------------------------------------------------------------
Manufacturer, Description
- --------------------------------------------------------------------------------
The Equipment is Currently Located at:
1402 Mariner Way
Santa Rosa, California 95407
BETA THREE:
Weinert Vacuum GMBH. sputtering roll coating machine, Mfg. 1995, 7' X 10'
chamber size, 480 volt, 3 phase, all stainless steel construction.
SERIAL NUMBER _____________________
CONSISTING OF BUT NOT LIMITED TO:
(6) 20" diffusion pumps.
(4) 16" diffusion pumps.
3 Chamber system.
Liebert UPS battery back-up system, model AP331, serial P21174SF.
(3) Polycold cooling systems, model PFC-1100ST.
(3) Cathodes.
(2) Aluminum sputtering cathodes.
(6) Transformers, 72 kilowatt.
Edwards two stage vacuum pump, model 275.
(3) Edwards two stage vacuum pumps, model 80.
(6) ENI D.C Plasma generators model DCG-100.
Allen Bradley controls.
(2) Mapping monitors.
(2) Control monitors.
PLC'S.
Circulation pumps.
Hydraulic pumps.
Other various monitors.
Miscellaneous spare parts.
- --------------------------------------------------------------------------------
FLEET CREDIT CORPORATION AID ASSOCIATION FOR LUTHERANS
By: By: /s/ Wayne C. Streck
-------------------------- -----------------------------------------
Name: Name: Wayne C. Streck
------------------------ -----------------------------------------
Title: Title: Vice President-Mortgages & Real Estate
----------------------- ---------------------------------------
By: /s/ Kenneth E. Podell
-----------------------------------------
Kenneth E. Podell
<PAGE>
FLEET CREDIT CORPORATION PAGE 2 OF 3
Schedule A Equipment
- --------------------------------------------------------------------------------
Manufacturer, Description
- --------------------------------------------------------------------------------
(2) Bell & Gosett pumps, models 114RC925, series 1510, serials 1955297 and
1955296.
Raven polypro tank, approximately 5' X 2', diameter.
(2) Bell & Gosett pumps, model 4BC9375, serial 1957959 and 1957960, 625 GPM.
Alfa laval heat exchanger, type M6-FG, serial 3010286368 with (4) 0-150 degree
gauges.
Alfa 1ave1 heat exchanger, type M10-BFG, serial 30102-86369 with (4) 0-150
degree gauges.
FSI water filter, model FSP-4ON-4-304SS, Mfg. 1995. 10 micron with 0-160 PSI
gauge.
Dual water cooling condensing system, low pressure, high pressure with (2) KSB
pumps, model ETACHROMB, valves, solenoids.
(2) Edwards two stage vacuum pumps, model 275.
Air storage tank 4' X 2' diameter with 0-160 PSI gauge.
Water filter systems with (2) KSB ETACHROM-B-40160562, pumps, 2200 gallon round
stainless steel tank, model BT33541.
Approximately 60' X 4" stainless steel piping with fittings.
Approximately 100' of 2" stainless steel piping with fittings.
BETA FIVE:
General Vacuum Equipment Corp. electron beam metalyzing system, Mfg. 1995, 78"
width capacity, 1200 feet per minute, 480 volt, 3 phase, 218 amps., model
95-005, overall size 9' X 10', serial W9827-95.
SERIAL NUMBER: _________________
CONSISTING OF BUT NOT LIMITED TO:
(8) Electron beam guns.
(8) Airco Temescal Simba 2 electron beam power supplies, serials 330,
337, 340, 338, 339, 336, 333 and 335.
(8) Programmable seep generators.
(8) High voltage controllers.
(8) Electron beam gun controllers.
(2) Polycolds, model PFC1100HC.
(6) Varian 20" diffusion pumps, model 016513/HS-20.
(8) Airco electron beam gun interfaces.
(4) Trige-Scott drive motors, model S90L01199100203050300011
serials 104529421295, 104529211295, 104529311295 and 104529411295.
- --------------------------------------------------------------------------------
<PAGE>
FLEET CREDIT CORPORATION PAGE 3 OF 3
Schedule A Equipment
- --------------------------------------------------------------------------------
Manufacturer, Description
- --------------------------------------------------------------------------------
WPH overhead wire rope crane, model 1 1/2 ton, serial W6022015, approximately
X-Y, travel is 55' X 35' X 40'.
Kinney vacuum rotary pump, model KT-505-LP, serial 3011-2 with a dresser roots
booster blower, 15 HP., model HV3000, serial H00224, 480 volts.
Kinney vacuum rotary pump, model KT-505-LP, serial 3011-1 with a dresser root
booster blower, 15 HP., model HV3000, serial H00219.
Dresser roots, 30 HP. booster pump.
(4) Emergency isolation switches.
(3) 5.5 Bar pneumatic actuator valves.
Solenoids.
Alfa laval heat exchanger, Mfg. 1995, serial 30102-86367.
(4) Weksler temperature gauges, 0-150F deg.
Raven round Polypro storage tank, approximately 6' X 4' diameter, serial
G333465.
Approximately 60 feet of 4" 304 stainless steel seamless piping with
connectors.
(2) ITT Bell & Gossett pumps, series 1510, 20 HP., 200 GPM, model 21/2AB7000BF,
serials 1955295 and 1955296.
(2) FSI filter columns, stainless steel, Mfg. 1995, 10 micron filters, serial
38121, 150 PSI.
Air storage tank 4'X 2' diameter with a 0-160 PSI gauge.
Miscellaneous spare parts.
And a11 standard and accessory Equipment.
- --------------------------------------------------------------------------------
<PAGE>
[LOGO]
AID ASSOCIATION FOR LUTHERANS
------------------------------------------------
4321 North Ballard Road, Appleton, WI 54919-0001
(414) 734-5721
Facsimile Copy
Date: April 18, 1996
Please deliver this message to: Lisa Evora
------------------------------------------------
From: Jan Schuette
- ------------------------------------------------
Aid Association for Lutherans
4321 North Ballard Road
Appleton, WI 54919
This message consists of 6 pages including this cover page.
Message:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
If there are any problems or if you do not receive all pages, please contact:
Name: Jan Schuette
(414/734-5721), Ext. 3613
( ) Original will not follow
( ) Original will follow by:
( ) Regular Mail
( ) Express Mail
This message is intended for the use of the addressee, and may contain
privileged or confidential information. If you are not the intended recipient,
or the employee or agent responsible for delivering the message to its intended
recipient, you are hereby notified that any dissemination, distribution or
copying of this communication is strictly prohibited. If you have received this
communication in error, please notify us immediately by telephone and return the
original message to us at the above address via the U.S. Postal Service.
--------------------------------------------------------------
A fraternal benefit society of Lutherans joined together for
insurance, investment, educational and volunteer opportunities.
<PAGE>
[LOGO] Fleet LEASE SCHEDULE NO. 32089-00002
Capital Leasing (True Lease Schedule)
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
Lessee: FLEX PRODUCTS, INC.
Address: 1402 MARINER WAY
SANTA ROSA, CA 95407
1. This Lease Schedule No. 32089 - 00002 dated as of June 19, 1996 is
entered into pursuant to and incorporates by this reference, all of the terms
and provisions of that certain Master Equipment Lease Agreement No. 32089 dated
as of JUNE 19, 1996 (the "Master Lease"), for the lease of the Equipment
described in Schedule A attached hereto. This Lease Schedule shall constitute a
separate, distinct and independent lease of the Equipment and the contractual
obligation of Lessee. References to the "the Lease" or "this Lease" shall mean
and refer to this Lease Schedule, together with the Master Lease and all
exhibits, addenda, schedules, certificates, riders and other documents and
instruments executed and delivered in connection with this Lease Schedule, all
as the same may be amended or modified from time to time. All capitalized terms
used herein and not defined herein shall have the meanings set forth or
referred to in the Master Lease. By its execution and delivery of this Lease
Schedule, Lessee hereby reaffirms all of the representations, warranties and
covenants contained in the Master Lease, as of the date hereof, and further
represents and warrants to Lessor that no Event of Default, and no event or
condition which with notice or the passage of time or both would constitute an
Event of Default, has occurred and is continuing as of the date hereof.
2. ACQUISITION COST. The Acquisition Cost of the Equipment is:
$4,500,000.00.
3. (a) LEASE TERM. The Lease Term shall commence on the date hereof and
shall continue for a period of 72 months after the Lease Term Commencement Date
set forth in the Acceptance Certificate to this Lease Schedule, plus any renewal
or extended term applicable in accordance with the terms of the Lease.
(b) RENTAL PAYMENTS. In addition to interim rent payable pursuant
to Section 2 of the Master Lease, Lessee shall pay Lessor 72 consecutive Rental
Payments in the amounts set forth in the schedule below, plus any applicable
sales/use taxes, commencing on the Rental Payment Commencement Date set forth
in the Acceptance Certificate and MONTHLY thereafter for the remaining Lease
Term. Each Rental Payment shall be payable on the same day of the month as the
Rental Payment Date in each succeeding rental period during the remaining Lease
Term (each, a "Rental Payment Date"):
Amount of Each
Number of Rental Payments Rental Payment
------------------------- --------------
12 65,109.74
60 73,780.11
(c) ADVANCE RENTAL PAYMENT. Lessee agrees to pay Lessor the first
01 and last O Rental Payments, due and payable on the Acceptance Date.
<PAGE>
(d) SECURITY DEPOSIT. Lessee agrees to make a payment in an amount
equal to 0% of the Acquisition Cost of the Equipment, due and payable on the
Acceptance Date, to be held by Lessor as a non-interest bearing deposit to
secure Lessee's performance under the Lease.
4. EQUIPMENT LOCATION(S). The Equipment will be located at the
location(s) specified in Schedule A-1 hereto.
5. Lessor will invoice Lessee for all sales, use and/or personal
property taxes as and when due and payable in accordance with applicable law,
unless Lessee delivers to Lessor a valid exemption certificate with respect to
such taxes. Delivery of such certificate shall constitute Lessee's
representation and warranty that no such taxes shall become due and payable with
respect to the Equipment and Lessee shall indemnify and hold harmless Lessor
from and against any and all liability or damages, including late charges and
interest which Lessor may incur by reason of the assessment of such taxes.
6. The Rental Payments may change for Equipment accepted after
July 12, 1996.
7. Lessee represents that the applicable recovery period for the
Equipment, for purposes of Section 168 of the Internal Revenue Code of 1986, is
as set forth in Schedule A hereto.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
ACCEPTANCE CERTIFICATE
[LOGO] Fleet
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Acceptance Certificate (this "Acceptance Certificate") is attached
to and made a part of that certain Lease Schedule No. 32089 - 00002, dated as of
June 19, 1996 (the "Lease Schedule"), by and between the undersigned parties.
All capitalized terms used herein and not defined herein shall have the meanings
set forth or referred to in the Lease Schedule. To the extent the terms set
forth in this Acceptance Certificate differ or conflict with any of the terms
set forth in the Lease, the terms set forth in this Acceptance Certificate shall
control.
1. Lessee acknowledges and agrees that each item of Equipment set forth
on Schedule A hereto (collectively, the "Equipment") is hereby unconditionally
accepted by Lessee for all purposes under the Lease at the locations specified
in Schedule A-1 hereto, and hereby agrees to faithfully perform all of its
obligations under the Lease as of the date hereof (the "Acceptance Date").
Lessee hereby authorizes and directs Lessor to make payment to each vendor of
the Equipment pursuant to such vendor's invoice or any purchase order, purchase
agreement or supply contract with such vendor, receipt and approval of which are
hereby reaffirmed by Lessee.
2. By its execution and delivery of this Acceptance Certificate, Lessee
hereby reaffirms all of the representations, warranties and covenants contained
in the Lease as of the date hereof, and further represents and warrants to
Lessor that no Event of Default, and no event or condition which with notice or
the passage of time or both would constitute an Event of Default, has occurred
and is continuing as of the date hereof. Lessee further certifies to Lessor that
Lessee has selected the Equipment and has received and approved the purchase
order, purchase agreement or supply contract under which the Equipment will be
acquired for all purposes of the Lease.
3. Lessee hereby represents and warrants that: (a) the Equipment has been
delivered and is in an operating condition and performing the operation for
which it is intended to the satisfaction of the Lessee; and (b) if requested by
Lessor, the Equipment has been marked or labeled evidencing the Lessor's
interest therein.
4. The LEASE TERM COMMENCEMENT DATE is the 10th day of July, 1996
5. The RENTAL PAYMENT COMMENCEMENT DATE is the 10th day of July, 1996
6. All terms and provisions of the Lease Schedule shall remain in full force and
effect, except as otherwise provided below:
- ACQUISITION COST: $ 4,500,000.00.
- LEASE TERM: (72) seventy-two months.
- RENTAL PAYMENTS: Number of Rental Payments Rental Payment Amount
12 $______
60 $______
- ADVANCE RENTAL PAYMENT(S): First 01 and last 00.
- SECURITY DEPOSIT: N/A %.
Dated: July 10, 1996
Agreed and Accepted:
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
---------------------------- ---------------------------
Name: John J. Gould Name: Michael B. Sullivan
-------------------------- -------------------------
Title: VP/Senior Lender Title: President
-------------------------- -------------------------
<PAGE>
FLEET CAPITAL CORPORATION PAGE 1 OF 1
SCHEDULE A EQUIPMENT
Attached to and made part of the following documents: Insurance Certification
with Flex Products, Inc. (32089-02)
The Depreciable Life of the Property is (07) seven years.
LOC# (01)
BETA FIVE
Unit Number: Beta V
(1) General Vacuum Equipment Corp. electron beam metalyzing system, Mfg. 1995,
78" width capacity, 1200 feet per minute, 480 volt, 3 phase, 218 amps, model
95-005, overall size 9' X 10', serial number 95005, which machine includes, but
not limited to, the following:
(8) Electron beam
(8) Airco Temescal Simba 2 electron beam power supplies, serial numbers 330,
337, 340, 338, 339, 336, 333 and 335
(8) Programmable seep generators
(8) High voltage controllers
(8) Electron beam gun controllers
(2) Polycolds, model PEC1100HC
(6) Varian 20" diffusion pumps, model 016513/HS-20
(8) Airco electron beam gun interfaces
(4) Trige-Scott drive motors, model S90L01199100203050300011, serial numbers
104529421295, 104529211295, 104529311295 and 104529411295
AND ALL STANDARD AND ACCESSORY EQUIPMENT.
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
BY: /s/ John J. Gould BY: /s/ Michael B. Sullivan
---------------------------- ---------------------------
NAME: John J. Gould NAME: Michael B. Sullivan
-------------------------- -------------------------
TITLE: VP/Senior Lender TITLE: President
-------------------------- -------------------------
<PAGE>
FLEET CAPITAL CORPORATION Schedule A-1
Equipment Location
Attached to and made part of the following documents True Lease Schedule No.
32089-02, Acceptance Certificate, UCC Financing Statement(s), Warranty Bill of
Sale with Flex Products, Inc.
- --------------------------------------------------------------------------------
Loc # Equipment Currently Located at:
- --------------------------------------------------------------------------------
01 1402 Mariner Way, Santa Rosa, California 95407
- --------------------------------------------------------------------------------
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
[LOGO] Fleet PURCHASE OPTION RIDER
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Purchase Option Rider (this "Rider") is attached to and made a
part of that certain Lease Schedule No. 32089-00002, dated as of June 19, 1996
(the "Lease Schedule"), by and between the undersigned parties.
If no Event of Default (or event or condition which, with the passage
of time or giving of notice, or both, would become such an Event of Default)
shall have occurred and be continuing, and the Lease shall not have been earlier
terminated, Lessee shall have the option to purchase (the "Purchase Option")
all, but not less than all, of the Equipment at the expiration of the Lease Term
for an amount, payable in immediately available funds on the last day of the
Lease Term, equal to: (a) all Rental Payments, late charges and other amounts
due and owing under the Lease; plus (b) all taxes, assessments and other charges
due or payable in connection with the sale of the Equipment to Lessee; plus (c)
an amount equal to 25.00000% of the Acquisition Cost of the Equipment, which
Lessor and Lessee acknowledge represents a reasonable current estimate of the
fair market value of the Equipment at the end of the Lease Term.
Provided that Lessor shall have received all amounts payable hereunder
on the last day of the Lease Term, and that no Event of Default then exists and
is continuing under the Lease, Lessor shall convey all of its right, title and
interest in and to the Equipment to Lessee on the last day of the Lease Term, on
an "AS-IS," "WHERE-IS" BASIS WITHOUT REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, and without recourse to Lessor, except that the Equipment shall be free
and clear of all liens created by Lessor. If Lessee intends to exercise the
Purchase Option, Lessee shall give irrevocable written notice to Lessor (the
"Option Notice") not more than 240 days, nor less than 180 days, prior to the
expiration of the Lease Term. If Lessee fails to give such written notice to
Lessor, it shall be conclusively presumed that Lessee has elected not to
exercise the Purchase Option.
If, for any reason, Lessee does not exercise the Purchase Option,
Lessee shall, on the last day of the Lease Term, return all of the Equipment to
Lessor pursuant to and in the condition required by the terms of the Lease and
pay to Lessor a return fee equal to 5.0% of the Acquisition Cost of the
Equipment.
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed. To the extent that
the provisions of this Rider conflict with any provisions contained in the
Lease, the provisions of this Rider shall control.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
[LOGO] Fleet STIPULATED LOSS VALUE SCHEDULE
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
This Stipulated Loss Value Schedule (this "Schedule") is attached to
and made a part of that certain Lease Schedule No. 32089-00002, dated as of June
19, 1996 (the "Lease Schedule"), by and between the undersigned parties.
<TABLE>
The following Stipulated Loss Values shall be used to calculate damages
or loss as provided in the Master Lease. The Stipulated Loss Value with respect
to any item of Equipment on any Rental Payment Date during the Lease Term shall
be an amount equal to the sum of: (a) all Rental Payments and other amounts then
due and owing to Lessor under the Lease, together with all accrued interest and
late charges thereon, calculated through and including the date of payment; plus
(b) the product of the Acquisition Cost of the such Equipment multiplied by the
percentage set forth below as of such Rental Payment Date.
<CAPTION>
<S> <C> <C> <C>
Rental Payment Date for Percentage of Rental Payment Date for Percentage of
Rental Payment Number Acquisition Cost Rental Payment Number Acquisition Cost
</TABLE>
SEE EXHIBIT C ATTACHED HERETO AND MADE A PART HEREOF
All capitalized terms used herein and not defined herein shall have the
meanings set forth or referred to in the Lease Schedule. Except as specifically
set forth herein, all of the terms and conditions of the Lease shall remain in
full force and effect and are hereby ratified and affirmed.
Dated as of: June 19, 1996
FLEET CAPITAL CORPORATION FLEX PRODUCTS, INC.
By: /s/ John J. Gould By: /s/ Michael B. Sullivan
----------------------------- -----------------------------
Name: John J. Gould Name: Michael B. Sullivan
--------------------------- ---------------------------
Title: VP/Senior Lender Title: President
-------------------------- --------------------------
<PAGE>
EXHIBIT C
TO
STIPULATED LOSS VALUE SCHEDULE
TO LEASE SCHEDULE NO. 32089-02
RENTAL PAYMENT PERCENTAGE OF RENTAL PAYMENT PERCENTAGE OF
DATE FOR RENTAL ACQUISITION COST DATE FOR RENTAL ACQUISITION COST
PAYMENT NUMBER PAYMENT NUMBER
1 103.35121715 37 70.90880090
2 102.77715752 38 69.75511355
3 102.19526265 39 68.59002020
4 101.59552206 40 67.41874422
5 100.98781724 41 66.23597391
6 100.37210821 42 65.04165152
7 99.73838360 43 63.84099969
8 99.09652408 44 62.62870597
9 98.44648879 45 61.40471189
10 97.78823666 46 60.16895869
11 97.11575495 47 58.92972240
12 96.43494366 48 57.67865042
13 95.54711438 49 56.42401842
14 94.34921445 50 55.15747340
15 93.74119331 51 53.87895553
16 92.81702863 52 52.59673978
17 91.88261080 53 51.30247247
18 90.93788832 54 49.99609306
19 89.97683797 55 48.68587582
20 89.00534921 56 47.36346638
21 88.02336959 57 46.02880349
22 87.03084644 58 44.68182560
23 86.02873119 59 43.33120369
24 85.01597126 60 41.96818663
25 83.99351758 61 40.60144498
26 82.96031708 62 39.22222721
27 81.91631576 63 37.83047065
28 80.86246378 64 36.43484516
29 79.79770726 65 35.02659847
30 78.72199142 66 33.60566720
31 77.63626563 67 32.18072044
32 76.53947521 68 30.74300521
33 75.43156457 69 29.29245738
34 74.31247787 70 27.82901249
35 73.18743961 71 26.37095856
36 72.05113926 72 24.89996987
72 25.00000000
<PAGE>
[LOGO] Fleet
Capital Leasing
PAY PROCEEDS LETTER
50 Kennedy Plaza
Providence, Rhode Island 02903-2305
We hereby authorize you to pay the following Payee(s) from the proceeds of
your financial accommodations to us in respect of that certain True Lease
Schedule No. 32089-00002 dated as of June 19, 1996, and make disbursements
directly to said Payee(s) as follows:
Amount of
PAYEE Payment
Flex Products, Inc. * $4,421,390.26
- ---------------------------------------------------- -------------------------
Fleet Capital Corporation (short fund to pay 78,609.74
- ---------------------------------------------------- -------------------------
Customer Invoice now due)
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
- ---------------------------------------------------- -------------------------
TOTAL: $4,500,000.00
--------------------
Dated as of: June 19 , 1996
------------------------
* BANK: Bank of America, NTSA FLEX PRODUCTS, INC.
10 Santa Rosa Ave.
Santa Rosa, CA By: /s/ Michael B. Sullivan
---------------------------
ABA #: 12100358 Name: Michael B. Sullivan
-------------------------
For Account of: FLEX PRODUCTS INC. Title: President
-------------------------
Account #: 14984-00242
<PAGE>
FLEET CAPITAL CORPORATION
50 Kennedy Plaza
Providence, RI 02903-2305
1-800-238-3737
FLEX PRODUCTS, INC.
1402 MARINER WAY
SANTA ROSA CA 95407-0000
July 10, 1996
- --------------------------------------------------------------------------------
DESCRIPTION AMOUNT
- --------------------------------------------------------------------------------
ADVANCE PAYMENT $65,109.74 +
ORIGINATION FEE $30,000.00 +
TRANSACTION EXPENSES $ 8,500.00 +
SH FUND $78,609.74 -
SUB DEP $25,000.00 -
Total Due $103,609.74
Total Received $103,609.74
Balance $0.00
- --------------------------------------------------------------------------------
RETURN YOUR REMITTANCE TO THE ATTENTION OF: SANDRA BUONAIUTO
TO INSURE PROPER CREDIT TO YOUR ACCOUNT, PLEASE RETURN REMITTANCE COPY.
A Subsidiary of Fleet National Bank
32089 00 001 00002
<PAGE>
WARRANTY BILL OF SALE
[LOGO] F1eet
Capital Leasing
50 Kennedy Plaza
Providence, Rhode Island 02903
FLEX PRODUCTS, INC. ("Seller") of 1402 MARINER WAY SANTA ROSA, CA
95407, in consideration of the sum of $4,500,000.00 Dollars, and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, does hereby sell, transfer and assign to Fleet Capital Corporation
("FCC"), a Rhode Island corporation having its principal office at 50 Kennedy
Plaza, Providence, Rhode Island 02903, the equipment set forth in Schedule A
hereto (the "Equipment").
Seller hereby covenants with and warrants to FCC that Seller is the
lawful owner of the Equipment and has the right to sell the Equipment, and that
the Equipment is free and clear of all rights, claims, liens, charges, security
interests or encumbrances of any other person. Seller will forever indemnify,
defend and warrant all of the rights of FCC in and to the Equipment transferred
hereunder against the claims and demands of all other persons.
IN WITNESS WHEREOF, Seller has duly executed this Bill of Sale this 11th day of
July, 1996.
FLEX PRODUCTS, INC.
By: /s/ Michael B. Sullivan
--------------------------------
Name: Michael B. Sullivan
------------------------------
Title: President
-----------------------------
State of California
--------------------------
County of Sonoma
--------------------------
Subscribed and sworn before me this 11th day of July, 1996.
/s/ Aggie S. Navarro
Notary Public
My Commission expires:________________
===============================
AGIE S. NAVARRO
[SEAL] COMM. #1009257
Notary Public--California
SONOMA COUNTY
My Comm. Expires NOV 11, 1997
===============================
<PAGE>
FLEET CREDIT CORPORATION
CONSENT AND WAIVER
(OWNER, LANDLORD OR MORTGAGEE OF REAL ESTATE)
50 Kennedy Plaza
Providence, Rhode island 02903
The undersigned, 0ptical Coating Laboratory, Inc., 2789 North Point Parkway
Santa Rosa, California 95407 is the owner, landlord or mortgagee of the premises
located at 1402 Mariner Way, Santa Rosa, California 95407 (the "Premises") which
are occupied by Flex Products, Inc.
The undersigned acknowledges that Customer has leased or financed, or that
Customer expects to lease or finance from Fleet Credit Corporation ("FCC"), the
Equipment set forth on Schedule A hereto including any accessories, additions,
substitutions or replacements therefor, which may from time to time be located
at the Premises. To induce FCC to enter into a lease or financing agreement with
Customer, the undersigned agrees with FCC as follows:
The undersigned waives any right, title or interest in or to the
Equipment that it may now or hereafter have. The undersigned
irrevocably agrees and consents that it will refrain from taking any
action to bar, restrain or otherwise prevent FCC, its agents,
successors or assigns, from entering the Premises for the purpose of
inspecting, removing or taking possession of the Equipment, and will
grant FCC, its agents, successors or assigns the right of entry to the
Premises to remove the Equipment at any reasonable time or times. FCC
shall be responsible for any damage to the Premises that FCC causes in
connection with its entry thereon and the removal of the Equipment
therefrom. The Equipment is and shall remain personal property,
notwithstanding the manner in which it may be installed or affixed to
the Premises.
This Consent and Waiver shall inure to the benefit of the successors and
assigns of FCC and shall be binding upon the heirs, representatives, successors
and assigns of the undersigned. The undersigned will, upon the request and at
the expense of FCC, execute and deliver to FCC such further and additional
documents as FCC may reasonably deem necessary or desirable to effect waivers
and consents contemplated hereby. This Agreement shall be governed by and
construed in accordance with the laws of the state in which the premises are
located, without reference to principles of conflict of laws.
IN WITNESS WHEREOF, the undersigned has duly executed this Consent and
Waiver this 11th day of July, 1996.
Optical Coating Laboratory, Inc.
/s/ Silvia C. Hogan By: /s/ John M. Markovich
- ------------------------- ------------------------------
(Witness) Title: V.P. Finance & CFO
---------------------------
<PAGE>
ACKNOWLEDGEMENT TO BE MADE BY OWNER,
LANDLORD OR MORTGAGEE OF REAL ESTATE
(Hereinafter referred to as "Undersigned")
[INDIVIDUAL)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this ___________ day of ____________________, 19__ personally appeared before me
___________________________, Undersigned in the foregoing Consent and Waiver, to
me personally well known and known to the person who signed said Consent and
Waiver, who, being by me duly sworn and being informed of the contents of said
Consent and Waiver stated and acknowledged on oath that he signed, executed,
sealed and delivered same as his free and voluntary act and deed, for the uses,
purposes and considerations therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(PARTNERSHIP)
STATE OF ________________________
SS.
COUNTY OF _______________________
I, _______________________ a Notary Public within and for said County,
in the State aforesaid, duly commissioned and acting, do hereby certify that on
this day ___________ of ____________________, 19__ personally appeared before me
___________________________ and ___________________________, who executed the
foregoing Consent and Waiver, to me personally well known and known to the
persons who signed said Consent and Waiver, and known to be and who, being by me
duly sworn and being informed of the contents of said Consent and Waiver, stated
and acknowledged on oath that they were Partners of ____________________________
__________________, the Partnership named in and which executed the said Consent
and Waiver, and that they signed, executed, sealed and delivered same
individually and in behalf of the said Partnership, with authority as their and
its free and voluntary act and deed for the uses, purposes and considerations
therein mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires ______________________ _________________________________
(Notary Public)
(Seal)
(CORPORATION)
===================================
STATE OF California SILVIA C. HOGAN
----------------- [SEAL] COMM. #1009258
SS. Notary Public - California
COUNTY OF Sonoma SONOMA COUNTY
----------------- My Comm. Expires NOV 11, 1997
===================================
I, Silvia C. Hogan, a Notary Public within and for said County, in the
State aforesaid, duly commissioned and acting, do hereby certify that on this
11th day of July, 1996 personally appeared before me John M. Markovich (Name of
Signer for Undersigned), to me personally well known and known to me to be the
person who signed the foregoing Consent and Waiver, and known to me to be and
who, being by me duly sworn and being informed of the contents of said Consent
and Waiver, stated and acknowledged to me an oath that he was Vice President &
CFO (Title) of Optical Coating Laboratory, Inc., the Corporation named in and
which executed said Consent and Waiver, and that he knows the corporate seal of
said Corporation, and that the seal affixed to said Consent and Waiver is the
corporate seal of said Corporation, that he was duly authorized to execute said
Consent and Waiver, for, in the name of and on behalf of said Corporation, and
that same was signed, sealed, executed and delivered by him in the name of and
on behalf of said Corporation by authority of its Board of Directors and that
the execution of said Consent and Waiver was his free and voluntary act and deed
in his said capacity and acknowledged to me that said Corporation executed the
same as its voluntary act and deed and was by him voluntarily executed, on
behalf of said Corporation for the uses, purposes and considerations therein
mentioned and set forth.
WITNESS my hand and seal as such Notary Public the day and year in this
certificate above written.
My commission expires November 11, 1997 /s/ Silvia C. Hogan
----------------- --------------------
(Notary Public)
(Seal)
<PAGE>
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
================================================================================
State of California
--------------------------
County of Sonoma
-------------------------
On July 11, 1996 before me, Silvia C. Hogan, Notary Public
------------- ------------------------------------------------------
Date NAME, TITLE OF OFFICER-E.G., "JANE DOE, NOTARY PUBLIC"
personally appeared John M. Markovich
------------------------------------------------------------
NAME(S) OF SIGNER(S)
[X] personally known to me - OR - [ ] proved to me on the basis of satisfactory
evidence to be the person whose name is
================================== subscribed to the within instrument and
SILVIA C. HOGAN acknowledged to me that he executed the
[SEAL] COMM. #1009258 same in his authorized capacity and that
Notary Public - California by his signature on the instrument the
SONOMA COUNTY person, or the entity upo behalf of which
My Comm. Expires NOV 11, 1997 the person acted, executed the instrument.
==================================
WITNESS my hand and official seal.
/s/ Silvia C. Hogan
------------------------------------------
SIGNATURE OF NOTARY
====================================OPTIONAL====================================
Though the data below is not required by law, it may prove valuable to persons
relying on the document and could prevent fraudulent reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT
[ ] INDIVIDUAL
[X] CORPORATE OFFICER
Vice President & CFO Consent and Waiver
---------------------------------- --------------------------------
TITLE(S) TITLE OR TYPE OF DOCUMENT
[ ] PARTNER(S) [ ] LIMITED 2
[ ] GENERAL --------------------------------
[ ] ATTORNEY-IN-FACT NUMBER OF PAGES
[ ] TRUSTEE(S)
[ ] GUARDIAN/CONSERVATOR 7-11-96
[ ] OTHER:____________________________ --------------------------------
__________________________________ DATE OF DOCUMENT
__________________________________
SIGNER IS REPRESENTING:
NAME OF PERSON(S) OR ENTITY(IES)
Optical Coating Laboratory, Inc. ----
- -------------------------------------- --------------------------------
SIGNER(S) OTHER THAN NAMED ABOVE
- --------------------------------------
================================================================================
<PAGE>
SUPPORT AGREEMENT
BETWEEN FLEET CAPITAL CORPORATION,
OPTICAL COATING LABORATORY, INC.
AND FLEX PRODUCTS, INC.
This Support Agreement, made and entered into as of July 11, 1996,
between FLEET CAPITAL CORPORATION ("Fleet"), OPTICAL COATING LABORATORY, INC.
("Parent"), and FLEX PRODUCTS, INC. ("Subsidiary").
Recitals:
A. Parent owns sixty percent (60%) of the outstanding common stock of
Subsidiary; and
B. Subsidiary has entered into that certain Master Equipment Lease
Agreement No. 32089 dated as of June 19, 1996 (the "Agreement") under which
Subsidiary now has and/or shall incur certain liabilities and obligations to
Fleet; and
C. Parent and Subsidiary desire to take certain actions and enhance and
maintain the financial condition of Subsidiary as hereinafter set forth in order
that Subsidiary might meet its Obligations (as hereinafter defined) to Fleet.
NOW, THEREFORE, in consideration of the mutual promises herein
contained, the parties hereto agree as follows:
1. Stock Ownership. During the term of this Support Agreement, Parent
will maintain a majority of the voting capital stock of Subsidiary now or
hereafter issued and outstanding.
2. Financial Covenants. During such period of time as any of the
Obligations of the Lessee to Fleet are outstanding, Parent agrees that it shall
not accept any payment, whether by dividend, salary, bonus, commission, loan or
other compensation other than in the ordianry course of business, which would be
a contributing cause to Lessee's violation of, the terms and conditions of
Lessee's obligations to Fleet, including, but not limited to, Lessee's financial
covenants under the Agreement.
3. Performance Provision. Upon and during the pendancy of any default by
the Lessee which is caused in whole or in part by any payment to Parent other
than in the ordinary course of business, or by failure of Parent to pay amounts
owing to Subsidiary when due, or by transfer of Subsidiary's assets to Parent,
Parent agrees hereby to cause Subsidiary to fully and promptly perform all of
the obligations which Subsidiary presently has or hereafter may have to Fleet
whether under the Agreement or otherwise (collectively, the "Obligations"), and
agrees to indemnify Fleet against any loss which it may sustain, and expense it
may incur, in connection with such default.
1 of 3
<PAGE>
4. Rights of Fleet. In the event that Subsidiary fails, is unable or
refuses to perform any of its Obligations in a timely manner, and such failure
to perform has been caused in whole or in part by a breach of Paragraph 2 or 3
of this Support Agreement by Parent, Fleet may proceed directly against Parent
to collect any of said Obligations and may exercise against Parent and/or
Subsidiary any rights and remedies that it may have under the Agreement or any
other agreement with respect to the Obligations. The obligations of Parent
hereunder shall not be affected by any waiver, modification, extension,
amendment or other change in any of the underlying Obligations between Fleet and
Subsidiary.
5. Termination; Amendment. This Support Agreement may be amended or
terminated at any time by written amendment or agreement signed by all parties.
6. Notices. Any notice, instruction, request, consent, demand or other
communication required or contemplated by this Support Agreement to be in
writing shal1 be given or made or communicated by first class mail, addressed as
follows:
If to Parent: Optical Coating Laboratory, Inc.
2789 Northpoint Parkway
Santa Rosa, CA 95047-7397
Attn: General Counsel
If to Subsidiary: Flex Products, Inc.
1402 Marina Way
Santa Rosa, CA 95407-7370
Attn: President
If to FLEET: Fleet Capital Corporation
50 Kennedy Plaza, 5th floor
Providence, RI 02903
Attn: Customer Service
7. Succcessors. The covenants, representations, warranties and
agreements herein set forth shall be mutually binding upon and inure to the
mutual benefit of Parent and its successors and Subsidiary and its successors
and Fleet and its successors and assigns.
8. Governing Law; Counterparts. This Support Agreement shall be governed
by the laws of the State of Rhode Island. This instrument may be executed in
counterparts and the executed counterparts shal1 together constitute one
instrument.
2 of 3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have set their hands and affixed
their corporate seals as of the day and year first above written.
OPTICAL COATING LABORATORY, INC.
By: /s/ John M. Markovich
------------------------------
Name: John M. Markovich
----------------------------
Title: VP Finance & CFO
---------------------------
FLEX PRODUCTS, INC.
By: /s/ Michael R. Sullivan
------------------------------
Name: Michael R. Sullivan
----------------------------
Title: President
---------------------------
FLEET CAPITAL CORPORATION
By: /s/ John J. Gould
------------------------------
Name: John J. Gould
----------------------------
Title: Vice President
---------------------------
3 of 3
