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EXHIBIT 10.18
MASTER LEASE AGREEMENT
This MASTER LEASE AGREEMENT is made, entered and dated as of Nov. 9, 1994,
by and between:
LESSOR: LESSEE:
BANC ONE LEASING CORPORATION BIOANALYTICAL SYSTEMS, INC.
2400 Corporate Exchange Drive 2701 Kent Avenue
Columbus, Ohio 43231 West Lafayette, Indiana 47906
1. LEASE OF EQUIPMENT: Lessor leases to Lessee, and Lessee leases from
Lessor, all the property described in the Lease Schedules which are signed from
time to time by Lessor and Lessee.
2. CERTAIN DEFINITIONS: "Schedule" means each Lease Schedule signed by
Lessee and Lessor which incorporates the terms of this Master Lease Agreement,
together with all exhibits, riders, attachments and addenda thereto.
"Equipment" means the property described in each Schedule, together with all
attachments, additions, accessions, parts, repairs, improvements, replacements
and substitutions thereto. "Lease", "herein", "hereunder", "here" and similar
words mean this Master Lease Agreement and all Schedules, together with all
exhibits, riders, attachments and addenda to any of the foregoing, as the same
may from time to time be amended, modified or supplemented. "Prime Rate" means
the prime rate of interest announced from time to time as the prime rate by
Bank One, Columbus, NA; provided, that the parties acknowledge that the Prime
Rate is not intended to be the lowest rate of interest charged by said bank in
connection with extensions of credit. "Lien" means any security interest,
lien, mortgage, pledge, encumbrance, judgment, execution, attachment, warrant,
writ, levy, other judicial process or claim of any nature whatsoever by or of
any person. "Fair Market Value" means the amount which would be paid for an
item of Equipment by an informed and willing buyer (other than a used equipment
or scrap dealer) and an informed and willing seller neither under a compulsion
to buy or sell. "Lessor's Cost" means the invoiced price of any item of
Equipment plus any other cost to Lessor of acquiring an item of Equipment. All
terms defined in the Lease are equally applicable to both the singular and
plural form of such terms.
3. LEASE TERM AND RENT: The term of the lease of the Equipment described in
each Schedule ("Lease Term") commences on the date stated in the Schedule and
continues for the term stated therein. As rent for the Equipment described in
each Schedule, Lessee shall pay Lessor the rent payments and all other amounts
stated in such Schedule, payable on the dates specified therein. All payments
due under the Lease shall be made in United States dollars at Lessor's office
stated in the opening paragraph or as otherwise directed by Lessor in writing.
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4. ORDERING, DELIVERY, REMOVAL AND INSPECTION OF EQUIPMENT: If an event of
default occurs or if for any reason Lessee does not accept, or revokes its
acceptance of, equipment covered by a purchase order or purchase contract or if
any commitment or agreement of Lessor to lease equipment to Lessee expires,
terminates or is otherwise canceled, then automatically upon notice from
Lessor, any purchase order or purchase contract and all obligations thereunder
shall be assigned to Lessee and Lessee shall pay and perform all obligations
thereunder. Lessee agrees to pay, defend, indemnify and hold Lessor harmless
from any liabilities, obligations, claims, costs and expenses (including
reasonable attorney fees and expenses) of whatever kind imposed on or asserted
against Lessor in any way related to any purchase orders or purchase contracts.
Lessee shall make all arrangements for, and Lessee shall pay all costs of,
transportation, delivery, installation and testing of Equipment. The Equipment
shall be delivered to Lessee's premises stated in the applicable Schedule and
shall not be removed without Lessor's prior written consent. Lessor has the
right upon reasonable notice to Lessee to inspect the Equipment wherever
located. Lessor may enter upon any premises where Equipment is located and
remove it immediately, without notice or liability to Lessee, upon the
expiration or other termination of the Lease Term.
5. MAINTENANCE AND USE: Lessee agrees it will, at its sole expense: (a)
repair and maintain the Equipment in good condition and working order and
supply and install all replacement parts or other devices when required to so
maintain the Equipment or when required by applicable law or regulation, which
parts or devices shall automatically become part of the Equipment; (b) use and
operate the Equipment in a careful manner in the normal course of its business
and only for the purposes for which it was designed in accordance with the
manufacturer's warranty requirements, and comply with all laws and regulations
relating to the Equipment, and obtain all permits or licenses necessary to
install, use or operate the Equipment; and (c) make no alterations, additions,
subtractions, upgrades or improvements to the Equipment without Lessor's prior
written consent, but any such alterations, additions, upgrades or improvements
shall automatically become part of the Equipment. The Equipment will not be
used or located outside of the United States.
6. NET LEASE; NO EARLY TERMINATION: The Lease is a net lease. Lessee's
obligation to pay all rent and all other amounts payable under the Lease is
absolute and unconditional under any and all circumstances and shall not be
affected by any circumstances of any character including, without limitation,
(a) any setoff, claim, counterclaim, defense or reduction which Lessee may have
at any time against Lessor or any other party for any reason, or (b) any defect
in the condition, design or operation of, any lack of fitness for use of, any
damage to or loss of, or any lack of maintenance or service for any of the
Equipment. Each Schedule is a noncancellable lease of the Equipment described
therein and Lessee's obligation to pay rent and perform all other obligations
thereunder and under the Lease are not subject to cancellation or termination
by Lessee for any reason.
7. NO WARRANTIES BY LESSOR. LESSOR LEASES THE EQUIPMENT AS-IS, WHERE-IS,
AND WITH ALL FAULTS. LESSOR MAKES NO WARRANTIES OR REPRESENTATIONS, EXPRESS OR
IMPLIED, OF ANY KIND AS TO THE EQUIPMENT INCLUDING, WITHOUT LIMITATION: ITS
MERCHANTABILITY; ITS FITNESS FOR ANY PARTICULAR PURPOSE; ITS DESIGN, CONDITION,
QUALITY, CAPACITY, DURABILITY, CAPABILITY, SUITABILITY OR WORKMANSHIP; ITS
NON-INTERFERENCE WITH OR
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NON-INFRINGEMENT OF ANY PATENT, TRADEMARK, COPYRIGHT OR OTHER INTELLECTUAL
PROPERTY RIGHT; OR ITS COMPLIANCE WITH ANY LAW, RULE, SPECIFICATION, PURCHASE
ORDER OR CONTRACT PERTAINING THERETO. Lessor hereby assigns to Lessee the
benefit of any assignable manufacturer's or supplier's warranties, but Lessor,
at Lessee's written request, will cooperate with Lessee in pursuing any
remedies Lessee may have under such warranties. Any action taken with regard
to warranty claims against any manufacturer or supplier by Lessee will be at
Lessee's sole expense. LESSOR MAKES NO REPRESENTATIONS OR WARRANTIES EXPRESS
OR IMPLIED, OF ANY KIND AS TO THE FINANCIAL CONDITION OR FINANCIAL STATEMENTS
OF ANY PARTY OR AS TO THE TAX OR ACCOUNTING TREATMENT OR CONSEQUENCES OF THE
LEASE, THE EQUIPMENT OR THE RENTAL PAYMENTS.
8. INSURANCE: Lessee at its sole expense shall at all times keep each item
of Equipment insured against all risks of loss or damage from every cause
whatsoever for an amount not less than the greater of the full replacement
value or the Lessor's Cost of such item of Equipment. Lessee at its sole
expense shall at all times carry public liability and property damage insurance
in amounts satisfactory to Lessor protecting Lessee and Lessor from liabilities
for injuries to persons and damage to property of others relating in any way to
the Equipment. All insurers shall be reasonably satisfactory to Lessor.
Lessee shall deliver to Lessor satisfactory evidence of such coverage.
Proceeds of any insurance covering damage or loss of the Equipment shall be
payable to Lessor as loss payee and shall, at Lessor's option, be applied
toward (a) the replacement, restoration or repair of the Equipment, or (b)
payment of the obligations of Lessee under the Lease. Proceeds of any public
liability or property insurance shall be payable first to Lessor as additional
insured to the extent of its liability, then to Lessee. If an event of default
occurs and is continuing, or if Lessee fails to make timely payments due under
Section 9 hereof, then Lessee automatically appoints Lessor as Lessee's
attorney-in-fact with full power and authority in the place of Lessee and in
the name of Lessee or Lessor to make claim for, receive payment of, and sign
and endorse all documents, checks or drafts for loss or damage under any such
policy. Each insurance policy will require that the insurer give Lessor at
least 30 days prior written notice of an y cancellation of such policy and will
require that Lessor's interests remain insured regardless of any act, error,
omission, neglect or misrepresentation of Lessee. The insurance maintained by
Lessee shall be primary without any right of contribution from insurance which
may be maintained by Lessor.
9. LOSS AND DAMAGE: (a) Lessee bears the entire risk of loss, theft, damage
or destruction of Equipment in whole or in part from any reason whatsoever
("Casualty Loss"). No Casualty Loss to Equipment shall relieve Lessee from the
obligation to pay rent or from any other obligation under the Lease. In the
event of Casualty Loss to any item of Equipment, Lessee shall immediately
notify Lessor of the same and Lessee shall, if so directed by Lessor,
immediately repair the same. If Lessor determines that and item of Equipment
has suffered a Casualty Loss beyond repair ("Lost Equipment"), then Lessee, at
the option of Lessor, shall: (1) Immediately replace the Lost Equipment with
similar equipment in good repair, condition and working order free and clear of
any Liens and deliver to Lessor a bill of sale covering the replacement
equipment, in which event such replacement equipment shall automatically be
Equipment under the Lease; or (2) On the rent
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payment date which is at least 30 but no more than 60 days after the date of
the Casualty Loss, pay to Lessor all amounts then due and payable by Lessee
under the Lease for the Lost Equipment plus the Stipulated Loss Value for such
Lost Equipment as of the date of the Casualty Loss. Upon payment by Lessee of
all amounts due under the above clause (2), the lease of the Lost Equipment
will terminate and Lessor shall transfer to Lessee all of Lessor's right, title
and interest in such Equipment on an "as-is, where-is" basis with all faults,
without recourse and without representation or warrant of any kind, express or
implied.
(b) "Stipulated Loss Value" of any item of equipment during its Lease Term
equals the present value discounted in arrears to the applicable date at the
applicable SLV Discount Rate of (1) the remaining rents and all other amounts
[including, without limitation, any balloon payment and, as to a terminal
rental adjustment clause ("TRAC") lease, the TRAC value stated in the Schedule,
and any other payments required to be paid by Lessee at the end of the
applicable [Lease Term] payable under the Lease for such item on and after such
date to the end of the applicable Lease Term and (2) an amount equal to the
Economic Value of the Equipment. For any item of Equipment, "Economic Value"
means the Fair Market Value of the Equipment at the end of the applicable Lease
Term as originally anticipated by Lessor at the Commencement Date of the
applicable Schedule; provided, that Lessee agrees that such value shall be
determined by the books of Lessor as of the Commencement Date of the applicable
Schedule. After the payment of all rent due under the applicable Schedule and
the expiration of the Lease Term of any item of Equipment, the Stipulated Loss
Value of such item equals the Economic Value of such item. Stipulated Loss
Value shall also include any Taxes payable by Lessor in connection with its
receipt thereof. For any item of Equipment, "SLV Discount Rate" means an
interest rate equal to the Prime Rate in effect on the Commencement Date of the
Schedule for such item minus two percentage points.
10. TAX BENEFITS INDEMNITY: (a) The Lease has been entered into on the
basis that Lessor shall be entitled to such deductions, credits and other tax
benefits as are provided by federal, state and local income tax law to an owner
of the Equipment (the "Tax Benefits") including, without limitation: (1)
modified accelerated cost recovery deductions on each item of Equipment under
Section 168 of the Code (as defined below) in an amount determined commencing
with the taxable year in which the Commencement Date of the applicable Schedule
occurs, using the maximum allowable depreciation method available under Section
168 of the Code, using a recovery period (as defined in Section 168 of the
Code) reasonably determined by Lessor, and using an initial adjusted basis
which is equal to the Lessor's Cost of such item; (2) amortization of the
expenses paid by Lessor in connection with the Lease on a straight-line basis
over the term of the applicable Schedule; and (3) Lessor's federal taxable
income will be subject to the maximum rate on corporations in effect under the
Code as of the Commencement Date of the applicable Schedule.
(b) If on any one or more occasions (1) Lessor shall lose, shall not have
or shall lose the right to claim all or any part of the Tax Benefits, (2) there
shall be reduced, disallowed, recalculated or recaptured all or any part of the
Tax Benefits, or (3) all or any part of the Tax Benefits is reduced by a change
in law or regulation (each of the events described in subparagraphs 1, 2 or 3
of this paragraph (b) will be referred to as a "Tax Loss"), then, upon 30 days
written notice by Lessor to
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Lessee that a Tax Loss has occurred, Lessee shall pay Lessor an amount which,
in the reasonable opinion of Lessor and after the deduction of all taxes
required to be paid by Lessor with respect to the receipt of such amount, will
provide Lessor with the same after-tax net economic yield which was originally
anticipated by Lessor as of the Commencement Date of the applicable Schedule.
(c) A Tax Loss shall occur upon the earliest of: (1) the happening of any
event (such as disposition or change in use of an item of Equipment) which may
cause such Tax Loss; (2) Lessor's payment to the applicable taxing authority of
the tax increase resulting from such Tax Loss; or (3) the adjustment of
Lessor's tax return to reflect such Tax Loss.
(d) Lessor shall not be entitled to payment under this section for any Tax
Loss caused solely by one or more of the following events: (1) a disqualifying
sale or disposition of an item of Equipment by Lessor prior to any default by
Lessee; (2) Lessor's failure to timely or properly claim the Tax Benefits in
Lessor's tax return; (3) a disqualifying change in the nature of Lessor's
business or liquidation thereof; (4) a foreclosure by any person holding
through Lessor a security interest on an item of Equipment which foreclosure
results solely from an act of Lessor; or (5) Lessor's failure to have
sufficient taxable income or tax liability to utilize the Tax Benefits.
(e) "Code" shall mean the Internal Revenue Code of 1986, as amended. For
the purposes of this section 10, the term "Lessor" shall include any affiliate
group (within the meaning of section 1504 of the Code) of which Lessor is a
member for any year in which a consolidated income tax return is filed for such
affiliated group. Lessee's obligations under this section shall survive the
expiration, cancellation or termination of the Lease.
11. GENERAL TAX INDEMNITY: Lessee will pay, and will defend, indemnify and
hold Lessor harmless on an after-tax basis from, any and all Taxes (as defined
below) and related audit and contest expenses on or relating to (a) any of the
Equipment, (b) the Lease, (c) purchase, acceptance, ownership, lease, use,
operation, transportation, return or other disposition of any of the Equipment,
and (d) rentals or earnings relating to any of the Equipment or the "Taxes"
means present and future taxes or other governmental charges that are not based
on the net income of Lessor, whether they are assessed to or payable by Lessee
or Lessor, including, without limitation (i) sales, use, excise, licensing,
registration, titling, franchise, business and occupation, gross receipts,
stamp and personal property taxes, (ii) levies, imposts, duties, assessments,
charges and withholdings, (iii) penalties, fines, and additions to tax and (iv)
interest on any of the foregoing. Unless Lessor elects otherwise, Lessor will
prepare and file all reports and returns relating to any Taxes and will pay all
Taxes to the appropriate taxing authority. Lessee will reimburse Lessor for
all such payments promptly on request. On or after any applicable
assessment/levy/lien date for any personal property Taxes relating to any
Equipment, Lessee agrees that upon Lessor's request Lessee shall pay to Lessor
the personal property Taxes which Lessor reasonably anticipates will be due,
assessed, levied or otherwise imposed on any Equipment during its Lease Term.
If Lessor elects in writing, Lessee will itself prepare and file all such
reports and returns, pay all such Taxes directly to the taxing authority, and
send Lessor evidence thereof. Lessee's obligations under this section shall
survive the expiration, cancellation or termination of the Lease.
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12. GENERAL INDEMNITY: Lessee assumes all risk and liability for, and shall
defend, indemnify and keep Lessor harmless on an after-tax basis from, any and
all liabilities, obligations, losses, damages, penalties, claims, actions,
suits, costs and expenses, including reasonable attorney fees and expenses, of
whatsoever kind and nature imposed on, incurred by or asserted against Lessor,
in any way relating to or arising out of the manufacture, purchase, acceptance,
rejection, ownership, possession, use, selection, delivery, lease, operation,
condition, sale, return or other disposition of the Equipment or any part
thereof (including, without limitation, any claim for latent or other defects,
whether or not discoverable by Lessee or any other person, any claim for
negligence, tort or strict liability, any claim under any environmental
protection or hazardous waste law and any claim for patent, trademark or
copyright infringement. Lessee will not indemnify Lessor under this section
for loss or liability arising from events which occur after the Equipment has
been returned to Lessor or for loss or liability caused directly and solely by
the gross negligence or willful misconduct of Lessor. In this section,
"Lessor" also includes any director, officer, employee, agent, successor or
assign of Lessor. Lessee's obligations under this section shall survive the
expiration, cancellation or termination of the Lease.
13. PERSONAL PROPERTY: Lessee represents and agrees that the Equipment is,
and shall at all times remain, separately identifiable personal property. Upon
Lessor's request, Lessee shall furnish Lessor a landlord's and/or mortgagee's
waiver and consent to remove all Equipment. Lessor may display notice of its
interest in the Equipment by any reasonable identification. Lessee shall not
alter or deface any such indicia of Lessor's interest.
14. DEFAULT: Each of the following events shall constitute an event of
default under the Lease: (a) Lessee fails to pay any rent or other amount due
under the Lease within ten days of its due date; or (b) Lessee fails to perform
or observe any of its obligations in Sections 8, 18, or 22 hereof; or (c)
Lessee fails to perform or observe any of its other obligations in the Lease
for more than 30 days after Lessor notifies Lessee of such failure; or (d)
Lessee or any Lessee affiliate defaults in the payment, performance or
observance of any obligation under any loan, credit agreement or other lease in
which Lessor or any subsidiary (direct or indirect) of Banc One Corporation
(which is Lessor's ultimate parent corporation) is the creditor or lessor; or
(e) any statement, representation or warranty made by Lessee in the Lease, in
any Schedule or in any document, certificate or financial statement in
connection with the Lease proves at any time to have been untrue or misleading
in any material respect as of the time when made; or (f) Lessee becomes
insolvent or bankrupt, or Lessee admits its inability to pay its debts as they
mature, or Lessee makes an assignment for the benefit of creditors, or Lessee
applies for, institutes or consents to the appointment of a receiver, trustee
or similar official for Lessee or any substantial part of its property or any
such official is appointed without Lessee's consent, or Lessee applies for,
institutes or consents to any bankruptcy, insolvency, reorganization, debt
moratorium, liquidation, or similar proceeding relating to Lessee or any
substantial part of its property under the laws of any jurisdiction or any such
proceeding is instituted against Lessee without stay or dismissal for more than
30 days, or Lessee commences any act amounting to a business failure or a
winding up of its affairs, or Lessee ceases to do business as a going concern;
or (g) with respect to any guaranty, letter of credit, pledge agreement,
security agreement, mortgage, deed of trust, debt subordination agreement or
other credit enhancement or
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credit support agreement (whether now existing of hereafter arising) signed or
issued by any party in connection with all or any part of Lessee's obligations
under the Lease, the party signing or issuing any such agreement defaults in
its obligations thereunder or any such agreement shall cease to be in full
force and effect or shall be declared to be null, void, invalid or
unenforceable by the party signing or issuing it; or (h) there shall occur in
Lessor's reasonable opinion any material adverse change in the financial
condition, business or operations of Lessee. As used in this section 14, the
term "Lessee" also includes any guarantor (whether now existing or hereafter
arising) of all or any part of Lessee's obligations under the Lease and/for any
issuer of a letter of credit (whether now existing or hereafter arising)
relating to all or any part of Lessee's obligations under the Lease, and the
term "Lease" also includes any guaranty or letter of credit (whether now
existing or hereafter arising) relating to all or any part of Lessee's
obligations under the Lease.
15. REMEDIES: If any event of default exists, Lessor may exercise in any
order one or more of the remedies described in the lettered subparagraphs of
this section, and Lessee shall perform its obligations imposed thereby:
(a) Lessor may require Lessee to return any or all Equipment as provided
in the Lease.
(b) Lessor or its agent may repossess any or all Equipment wherever found,
may enter the premises where the Equipment is located and disconnect, render
unusable and remove it, and may use such premises without charge to store or
show the Equipment for sale.
(c) Lessor may sell any or all Equipment at public or private sale, with
or without advertisement or publication, may re-lease or otherwise dispose of
it or may use, hold or keep it.
(d) Lessor may require Lessee to pay to Lessor on a date specified by
Lessor, with respect to any or all Equipment (i) all accrued and unpaid rent,
late charges and other amounts due under the Lease on or before such date, plus
(ii) as liquidated damages for loss of a bargain and not as a penalty, and in
lieu of any further payments of rent, the Stipulated Loss Value of the
Equipment on such date, plus (iii) interest at the Overdue Rate on the total of
the foregoing ("Overdue Rate" means an interest rate per annum equal to the
higher of 18% or 2% over the Prime Rate, but not to exceed the highest rate
permitted by applicable law). The parties acknowledge that the foregoing money
damage calculation reasonably reflects Lessor's anticipated loss with respect
to the Equipment and the related Lease resulting from the event of default. If
an event of default under section 14 (f) of this Master Lease Agreement exists,
then Lessee will be automatically liable to pay Lessor the foregoing amounts as
of the next rent payment date unless Lessor otherwise elects in writing.
(e) Lessee shall pay all costs, expenses and damages incurred by Lessor
because of the event of default or its actions under this section, including,
without limitation any collection agency and/or attorney fees and expenses, any
costs related to the repossession, safekeeping, storage, repair, reconditioning
or disposition of the Equipment and any incidental and consequential damages.
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(f) Lessor may terminate the Lease and/or any or all Schedules, may sue to
enforce Lessee's performance of its obligations under the Lease and/or may
exercise any other right or remedy then available to Lessor at law or in
equity.
Lessor is not required to take any legal process or give Lessee any notice
before exercising any of the above remedies. None of the above remedies is
exclusive, but each is cumulative and in addition to any other remedy available
to Lessor. Lessor's exercise of one or more remedies shall not preclude its
exercise of any other remedy. No action taken by Lessor shall release Lessee
from any of its obligations to Lessor. No delay or failure on the part of
Lessor to exercise any right hereunder shall operate as a waiver thereof, nor
as an acquiescence in any default, nor shall any single or partial exercise of
any right preclude any other exercise thereof or the exercise of any other
right. After any default, Lessor's acceptance of any payment by Lessee under
the Lease shall not constitute a waiver by Lessor of such default, regardless
of Lessor's knowledge or lack of knowledge at the time of such payment, and
shall not constitute a reinstatement of the Lease if the Lease has been
declared in default by Lessor, unless Lessor has agreed in writing to reinstate
the Lease and to waive the default.
If Lessor actually repossesses any Equipment, then it will use
commercially reasonable efforts under the then current circumstances to attempt
to mitigate its damages; provided, that Lessor shall not be required to sell,
re-lease or otherwise dispose of any Equipment prior to Lessor enforcing any of
the remedies described above. Lessor may sell or re-lease the Equipment in any
manner it chooses, free and clear of any claims or rights of Lessee and without
any duty to account to Lessee with respect thereto except as provided below.
If Lessor actually sells or re-leases the Equipment, it will credit the net
proceeds of any sale of the Equipment, or the net present value (discounted at
the then current Prime Rate) of the rents payable under any new lease of the
Equipment, against and up to (but not exceeding) the Stipulated Loss Value of
the Equipment and any other amounts Lessee owes Lessor, or will reimburse
Lessee for and up to (but not exceeding) Lessee's payment thereof. The term
"net" as used above shall mean such amount after deducting the costs and
expenses described in clause (e) above of this section. If Lessor elects in
writing not to sell or re-lease any Equipment, it will similarly credit or
reimburse Lessee for Lessor's reasonable estimate of such Equipment's Fair
Market Value.
16. LESSOR'S RIGHT TO PERFORM: If Lessee fails to make any payment under
the Lease or fails to perform any of its other agreements in the Lease
(including, without limitation, its agreement to provide insurance coverage as
stated in the Lease), Lessor may itself make such payment or perform such
agreement, and the amount of such payment and the amount of the expenses of
Lessor incurred in connection with such payment or performance shall be deemed
to be additional rent, payable by Lessee on demand.
17. FINANCIAL REPORTS: Lessee agrees to furnish to Lessor: (a) annual
financial statements setting forth the financial condition and results of
operation of Lessee (financial statements shall include the balance sheet,
income statement and changes in financial position and all notes thereto)
within 120 days of the end of each fiscal year of Lessee; (b) quarterly
financial statements setting forth the financial condition and results of
operation of Lessee within 60 days of the end of
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each of the first three fiscal quarters of Lessee; and (c) such other financial
information as Lessor may from time to time reasonably request including,
without limitation, financial reports filed by Lessee with federal
or state regulatory agencies. All such financial information shall be prepared
in accordance with generally accepted accounting principles. If Lessee fails
to furnish the annual financial statements to Lessor within 30 days of Lessor's
written request, then Lessor may, at its option, charge Lessee a
non-performance fee equal to all the rentals due under the Lease for the then
current month (unless otherwise prohibited by law) and such fees shall be
deemed to be additional rent, payable by Lessee on demand.
18. NO CHANGES IN LESSEE: Lessee shall not: (a) liquidate, dissolve or
suspend business; (b) sell, transfer or otherwise dispose of all or a majority
of its assets, except that Lessee may sell its inventory in the ordinary course
of its business; (c) enter into any merger, consolidation or similar
reorganization unless it is the surviving corporation; (d) transfer all or any
substantial part of its operations or assets outside of the United States of
America; or (e) without 30 days advance written notice to Lessor, change its
name or chief place of business. Lessee shall at all times maintain a tangible
net worth which is no less than the greater of 75% of its tangible net worth as
of the date of the Master Lease Agreement or 75% of its highest tangible net
worth thereafter.
19. LATE CHARGES: If any rent or other amount payable under the Lease is
not paid when due, then as compensation for the administration and enforcement
of Lessee's obligation to make timely payments, Lessee shall pay with respect
to each overdue payment on demand an amount equal to the greater of fifteen
dollars ($15.00) or five percent (5%) of the each overdue payment (but not to
exceed the highest late charge permitted by applicable law) plus any collection
agency fees and expenses.
20. NOTICES; POWER OF ATTORNEY: (a) Service of all notices under the Lease
shall be sufficient if given personally or cornered or mailed to the party
involved at its respective address set forth herein or at such other address as
such party may provide in writing from time to time. Any such notice mailed to
such address shall be effective three days after deposit in the United States
mail with postage prepaid. (b) With respect to any power of attorney covered
by the Lease, the powers conferred on Lessor thereby: are powers coupled with
an interest; are irrevocable; are solely to protect Lessor's interests under
the Lease; and do not impose any duty on Lessor to exercise such powers.
Lessor shall be accountable solely for amounts it actually receives as a result
of its exercise of such powers.
21. ASSIGNMENT BY LESSOR: Lessor and any assignee of Lessor, with or
without notice to or consent of Lessee, may sell, assign, transfer or grant a
security interest in all or any part of Lessor's rights, obligations, title or
interest in the Equipment, the Lease, any Schedule or the amounts payable under
the Lease or any Schedule to any entity ( "transferee"). The transferee shall
succeed to all of Lessor's rights in respect to the Lease (including; without
limitation, all rights to insurance and indemnity protection described in the
Lease). Lessee agrees to sign any acknowledgment and other documents
reasonably requested by Lessor or the transferee in connection with any such
transfer transaction. Lessee, upon receiving notice of any such transfer
transaction,
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shall comply with the terms and conditions thereof. Lessee agrees that it
shall not assert against any transferee any claim, defense, setoff, deduction
or counterclaim which Lessee may now or hereafter be entitled to assert against
Lessor. Unless otherwise agreed in writing, the transfer transaction shall not
relieve Lessor of any of its obligations to Lessee under the Lease and Lessee
agrees that the transfer transaction shall not be construed as being an
assumption of such obligations by the transferee.
22. NO ASSIGNMENT, SUBLEASE OR LIEN BY LESSEE: LESSEE SHALL NOT,
DIRECTLY OR INDIRECTLY, (a) MORTGAGE, ASSIGN, SELL, TRANSFER, OR OTHERWISE
DISPOSE OF THE LEASE OR ANY INTEREST THEREIN OR THE EQUIPMENT OR ANY PART
THEREOF, OR (b) SUBLEASE, RENT, LEND OR TRANSFER POSSESSION OR USE OF THE
EQUIPMENT OR ANY PART THEREFOR TO ANY PARTY, OR (c) CREATE, INCUR, GRANT,
ASSUME OR ALLOW TO EXIST ANY LIEN ON THE LEASE, ANY SCHEDULE. THE EQUIPMENT OR
ANY PART THEREOF.
23. EXPIRATION OF LEASE TERM: (a) At least 90 days (or earlier if otherwise
specified), but no more than 270 days prior to expiration of the Lease Term of
each Schedule, Lessee shall give Lessor written notice of its electing one of
the following options for all (but not less than all) of the Equipment covered
by such Schedule: return the Equipment under clause (b) below; or purchase the
Equipment under clause (c) below. The election of an option shall be
irrevocable. If Lessee fails to give timely notice of its election, it shall
be deemed to have elected to return the Equipment.
(b) If Lessee elects or is deemed to have elected to return the Equipment
at the expiration of the Lease Term of a Schedule or if Lessee is obligated at
any time to return the Equipment, then Lessee shall, at its sole expense and
risk, deinstall, disassemble, pack, crate, insure and return the Equipment to
Lessor (all in accordance with applicable industry standards) at any location
in the continental United States of America selected by Lessor. The Equipment
shall be in the same condition as when received by Lessee, reasonable wear,
tear and depreciation resulting from normal and proper use excepted (or, if
applicable, in the condition set forth in the Lease or the Schedule), shall be
in good operating order and maintenance as required by the Lease, shall be
certified as being eligible for any available manufacturer's maintenance
program, shall be free and clear of any Liens as required by the Lease, shall
comply with all applicable laws and regulations and shall include all manuals,
specifications, repair and maintenance records and similar documents. Until
Equipment is returned as required above, all terms of the Lease shall remain in
full force and effect including, without limitation, obligations to pay rent
and insure the Equipment; provided, that after the expiration of any Schedule
and before Lessee has completed its return of the Equipment or its purchase
option (if elected), the term of the lease of the Equipment covered by such
Schedule shall be month-to-month or such shorter period as may be specified by
Lessor.
(c) If Lessee gives Lessor timely notice of its election to purchase
Equipment, then on the expiration date of the applicable Schedule Lessee shall
purchase all (but not less than all) of the Equipment and shall pay to Lessor
the Fair Market Value of the Equipment plus all Taxes (other than
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income taxes on Lessor's gains on such sale), costs and expenses incurred or
paid by Lessor in connection with such sale plus all accrued but unpaid amounts
due with respect to the Equipment and/or the Schedule. The Stipulated Loss
Value or Economic Value of any item of Equipment shall have no bearing or
influence on the determination of Fair Market Value under this clause (c).
Upon payment in full of the above amounts, and if no default has occurred and
is continuing under the Lease, Lessor shall transfer title to such Equipment to
Lessee "as-is, where-is" with all faults and without recourse to Lessor and
without any representation or warranty of any kind whatsoever by Lessor,
express or implied.
(d) For purposes of the purchase option of the Lease, the determination of
the Fair Market Value of any Equipment shall be determined (1) without
deducting any costs of dismantling or removal from the location of use, (2) on
the assumption that the Equipment is in the condition required by the
applicable return and maintenance provisions of the Lease and is free and clear
of any Liens as required by the Lease, and (3) shall be determined by mutual
agreement of Lessee and Lessor or, if Lessor and Lessee are not able to agree
on such value, by the Appraisal Procedure. "Appraisal Procedure" means the
determination of Fair Market Value by an independent appraiser acceptable to
Lessor and Lessee, or, if the parties are unable to agree on an acceptable
appraiser, by averaging the valuation (disregarding the one which differs the
most from the other two) of three independent appraisers, the first appointed
by Lessor, the second appointed by Lessee and the third appointed by the first
two appraisers. For purposes of the "Remedies" section of the Lease, the Fair
Market Value shall be determined by Lessor in good faith and any such valuation
shall be on an "as-is, where is" basis without regard to the first sentence of
this clause (d). Lessee, at its sole expense, shall: pay all fees, costs and
expenses of the above described appraisers.
24. GOVERNING LAW: THE INTERPRETATION, CONSTRUCTION AND VALIDITY OF THE
LEASE SHALL BE GOVERNED BY THE LAWS OF THE STATE OF OHIO. WITH RESPECT TO ANY
ACTION BROUGHT BY LESSOR AGAINST LESSEE TO ENFORCE ANY TERM OF THE LEASE,
LESSEE HEREBY IRREVOCABLY CONSENTS TO THE JURISDICTION AND VENUE OF ANY STATE
OR FEDERAL COURT IN THE FRANKLIN COUNTY, OHIO, WHERE LESSOR HAS ITS PRINCIPAL
PLACE OF BUSINESS AND WHERE PAYMENTS ARE TO BE MADE BY LESSEE.
25. MISCELLANEOUS: (a) Subject to the limitations herein, the Lease
shall be binding upon and inure to the benefit of the parties hereto and their
respective heirs, administrators, successors and assigns. (b) This Master
Lease Agreement and each Schedule may be executed in any number of
counterparts, which together shall constitute a single instrument. Only one
counterpart of each Schedule shall be marked "Lessor's Original" and all other
counterparts shall be marked "Duplicate". A security interest in any Schedule
may be created through transfer and possession only of the counterpart marked
"Lessor's Original". (c) Section and paragraph headings in this Master Lease
Agreement and the Schedules are for convenience only and have no independent
meaning. (d) The terms of the Lease shall be severable and if any term thereof
is declared unconscionable, invalid, illegal or void, in whole or in part, the
decision so holding shall not be construed as impairing the other terms of the
Lease and the Lease shall continue in full force and effect as if such invalid,
illegal,
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void or unconscionable term were not originally included herein. (e) All
indemnity obligations of Lessee under the Lease and all rights, benefits and
protections provided to Lessor by warranty disclaimers shall survive the
cancellation, expiration or termination of the Lease. (f) Lessor shall not be
liable to Lessee for any indirect, consequential or special damages for any
reason whatsoever. (g) Each payment made by Lessee shall be applied by Lessor
in such manner as Lessor determines in its discretion which may include,
without limitation, application as follows: first, to accrued late charges;
second, to accrued rent; and third, the balance to any other amounts then due
and payable by Lessee under the Lease. (h) If the Lease is signed by more than
one Lessee, each of such Lessees shall be jointly and severally liable for
payment and performance of all of Lessee's obligations under the Lease.
26. ENTIRE AGREEMENT: THE LEASE REPRESENTS THE FINAL, COMPLETE AND ENTIRE
AGREEMENT BETWEEN THE PARTIES HERETO. THERE ARE NO ORAL OR UNWRITTEN
AGREEMENTS OR UNDERSTANDINGS AFFECTING THE LEASE OR THE EQUIPMENT. Lessee
agrees that Lessor is not the agent of any manufacturer or supplier, that no
manufacturer or supplier is an agent of Lessor, and that any representation,
warranty or agreement made by a manufacturer, supplier or their employees,
sales representatives or agents shall not be binding on Lessor.
27. JURY WAIVER: ALL PARTIES TO THIS MASTER LEASE AGREEMENT WAIVE ALL
RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY
ANY PARTY AGAINST ANY OTHER PARTY ON ANY MATTER WHATSOEVER ARISING OUT OF, IN
CONNECTION WITH OR IN ANY WAY RELATED TO THIS MASTER LEASE AGREEMENT.
BANC ONE LEASING CORPORATION BIOANALYTICAL SYSTEMS, INC.
Lessor Lessee
By:\S\ILLEGIBLE By:\S\PETER T. KISSINGER
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Title: AVP Title: President
---------------------- -------------------------
Lessee's Witness:\S\E.C. BANNON
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Regardless of any prior, present or future oral agreement or course of
dealing, no term or condition of the Lease may be amended, modified, waived,
discharged, canceled or terminated except by a written instrument signed by the
party to be bound; except Lessee authorizes Lessor to complete the Acceptance
Date of each Schedule and the serial numbers of any Equipment.
BIOANALYTICAL SYSTEMS, INC.
By:\S\PETER T. KISSINGER
-----------------------------
Title:President
--------------------------
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