Exhibit 10.10
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NORSTAN MASTER LEASE NO. COMMENCEMENT DATE
FINANCIAL SERVICES, INC. 2273-000 7-1-98
6900 WEDGWOOD ROAD SUITE 150
PO BOX 9003 ----------------------------------------
MAPLE GROVE, MN 55311 SALES REP
PHONE: 612-420-1100
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MASTER EQUIPMENT LEASE
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LESSEE
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NAME (CORRECT LEGAL NAME)
LATITUDE COMMUNICATIONS
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ADDRESS
2121 TASMAN DRIVE
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CITY STATE ZIP
SANTA CLARA CA 95054
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LESSEE CONTACT PHONE NO.
JOLYNN JOHNSSON (408) 988-7281
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MASTER TERMS AND CONDITIONS - PLEASE READ CAREFULLY BEFORE SIGNING
1. ENTIRE AGREEMENT. This Lease which includes the provisions on the reverse
side hereof and any other Schedule(s) made a part hereof by the parties,
constitute the entire agreement between Lessor and Lessee.
2. TERM/RENT. Upon acceptance hereof, Lessor agrees to lease to Lessee the
"Equipment" indicated in the Schedule(s) to be annexed hereto for the "Basic
Term" indicated on said Schedule(s). Lessee promises to pay to Lessor, or
order, the aggregate Basic Rent as provided on said Schedule(s), and all
other payments provided herein, in Lessor's corporate office. The Term and
the first rental period and monthly payment for the Equipment will commence
on the first day of the month following Lessee's acceptance of the Equipment
and shall continue for the number of months indicated on said Schedule(s). In
addition, Lessee shall pay to Lessor an interim rent payment equal to a
prorata amount of the monthly rent payment for each day from the date of
acceptance of the Equipment until the first day of the following month. The
Basic Rent, shall be adjusted and increased by Lessor to cover any and all
sales, use or rental taxes imposed from time to time upon Lessor, the Basic
Rent, and/or the Equipment.
Lessee understands and agrees that neither the supplier nor any marketing
officer is an agent of Lessor. No such supplier nor marketing officer is
authorized to alter, waive or add to any term or condition of this Lease, and
no representation as to the Equipment, Lease or any other matter by any
supplier or any marketing officer shall in any way affect Lessee's duty to
pay Basic Rent, and/or to perform its other obligations as set forth herein.
LESSEE SHALL PAY AND PERFORM THIS LEASE WITHOUT NOTICE, DEMAND, OFFSET,
DEDUCTION, DEFENSE OR DEFERMENT, AND ANY CLAIMS BY LESSEE AGAINST LESSOR
SHALL ONLY BE ASSERTED IN AN INDEPENDENT ACTION. THIS LEASE CANNOT BE
CANCELLED OR TERMINATED BY LESSEE EXCEPT AS PROVIDED HEREIN.
3. DISCLAIMERS. LESSOR, NOT BEING THE MANUFACTURER OR SUPPLIER OF ANY OF THE
EQUIPMENT, HAS NOT MADE AND DOES NOT MAKE TO LESSEE ANY REPRESENTATION,
WARRANTY OR COVENANT, EXPRESS OR IMPLIED, WITH RESPECT TO THE EQUIPMENT, OR
THE DELIVERY, INSTALLATION OR TIMELINESS THEREOF, NOR WITH RESPECT TO THE
EQUIPMENT'S MANUFACTURE, DESIGN, CONDITION, FITNESS FOR USE, OR
MERCHANTABILITY, AND ALL EQUIPMENT SHALL BE ACCEPTED AND LEASED BY LESSEE "AS
IS". IN NO EVENT SHALL LESSOR BE LIABLE FOR ANY SPECIAL, CONSEQUENTIAL OR
INCIDENTAL DAMAGES TO LESSEE AS A RESULT OF THIS LEASING TRANSACTION. LESSEE
AGREES ALL SUCH CLAIMS SHALL BE ASSERTED AND/OR SETTLED DIRECTLY WITH THE
SUPPLIER(S) AND NO SUCH CLAIMS SHALL BE ASSERTED AGAINST LESSOR.
4. EQUAL OPPORTUNITY. NORSTAN shall observe its responsibilities under Executive
Order 11246, as amended and the regulations at 41 CFR Parts 60-1 through 60-
80, and Sections 402/503 and the regulations at 41 CFR Parts 250 and 60-741.
5. EQUIPMENT SELECTION/ORDERING/ACCEPTANCE. Lessee has selected the
suppliers, type, design and quality of Equipment and hereby requests Lessor
to acquire and lease the same upon the terms hereof. LESSEE ASSUMES THE
RESPONSIBILITY FOR DELIVERY, INSPECTION AND ACCEPTANCE OF THE EQUIPMENT AND
LESSOR SHALL NOT BE LIABLE OR RESPONSIBLE FOR ANY DELAY OR FAILURE OF
DELIVERY OF SAID ORDERED EQUIPMENT. LESSEE ASSUMES ALL RISKS AND OBLIGATIONS
TO ANY SUPPLIER ON ACCOUNT OF NONACCEPTANCE OF THE EQUIPMENT OR TERMINATION
OF THIS LEASE. So long as Lessee is not in default, Lessee may, at its
expense, enforce damage and warranty claims to its interest directly against
the supplier(s), and the same shall be deemed part of the Equipment and
Collateral described in Section 10 hereof.
6. LOCATION/INSPECTION. The location of the Equipment shall be as indicated
hereon (or on its Schedule). The location shall not be changed without
Lessor's prior written consent. Lessee shall permit Lessor, its agents, and
potential purchasers of the Equipment, access at reasonable times to inspect
the Equipment, and observe its use and condition.
7. LIENS AND ENCUMBRANCES. Lessee will at all times protect and defend, at its
own cost and expense, the interest and priority of Lessor and keep the
Equipment (and additions or attachments of Lessee thereto, if any) free and
clear from any and all claims, liens and processes and other encumbrances.
8. SECURITY INTEREST. Lessor and Lessee intend this transaction to be a leasing
transaction only, but to the extent, at any time or from time to time, this
Lease is construed or asserted to be a transaction intended as a security,
Lessor retains and/or Lessee hereby grants to Lessor a security interest in
and to all the Equipment, the proceeds of any contracts, sale, assignment,
lease or sub-lease thereof, any insurance proceeds, and any other rights of
Lessee in and to the Equipment, the Lease and/or their proceeds. No title
equity or right in or to the Equipment shall pass to Lessee except in
accordance with the terms hereof. Lessee agrees that Lessor is authorized to
file a copy of this Lease as a financing statement and file it or other
financing statements or amendments thereto with or without the signature of
Lessee with respect to any or all of the Equipment and, if Lessee's signature
is required thereon by law, Lessee irrevocable appoints Lessor as Lessee's
attorney-in-fact to execute any such financing statements.
9. ASSIGNMENT/SUBLEASE. Lessee shall not sell, transfer, assign, sublease,
convey, encumber or pledge its interest in and to this Lease, any Schedule or
the Equipment, and any such sale, transfer, assignment, sublease, conveyance,
encumbrance or pledge, whether by operation of law or otherwise, without the
prior written consent of Lessor, shall be void. Lessor, its successor and
assigns, may sell or assign this Lease or any Lease Schedule and/or grant
security interest therein or security interest in the Equipment, in whole or
in part, with or without notice to Lessee. The provisions of this Lease shall
be binding upon any successors and any permitted assigns of Lessor and
Lessee.
THIS LEASE IS NOT BINDING UNTIL ACCEPTED BY LESSOR
LESSEE: LESSOR: NORSTAN FINANCIAL SERVICES INC.
FULL LEGAL NAME OF LESSEE
BY /s/ Emil Wang BY /s/ Jeff Matson
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Signature Signature
ITS President & CEO ITS VP/GM
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Title Title
DATE ACCEPTED 3/30/98 DATE ACCEPTED 7/2/98
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10. USE AND MAINTENANCE. Lessee, at Lessee's expense, agrees to use the
Equipment in a careful and proper manner, and to comply with and conform to
all federal, state, municipal, and other laws, ordinances and regulations
applicable in any way to the inspection, possession, use or maintenance of
the Equipment. Lessee agrees, at its expense, (1) to maintain the Equipment
in top condition, ordinary wear and tear excepted, and (2) to timely repair
and/or replace any failed or damaged part thereof so that the Equipment
remains at all times in full repair, operating order, and safe working
condition.
11. ALTERATIONS. Lessee shall, at its sole cost and expense, make all
improvements, alteration, modifications, additions and attachments to the
Equipment required or recommended by any Federal, State, or local
governmental body or agency. Lessee shall not make any other alterations,
additions, deletions or improvements to the Equipment without the prior
written consent of Lessor. All such changes shall immediately be and become
part of the Equipment and Collateral under this Lease.
12. LOSS/DAMAGE. Lessee shall assume and bear risk of loss and damage to the
Equipment and all component parts thereof from any and every cause
whatsoever, whether or not covered by insurance. No loss or damage to the
Equipment or any component part thereof shall impair any obligation of
Lessee under this Lease, which shall continue in full force and effect. In
the event of any loss and/or damage of any kind to the Equipment, or any
items(s) of Equipment, Lessee, at the option of Lessor, shall (a) place the
same in first class condition and repair, or (b) replace the same with like
Equipment in first class condition and repair.
13. INSURANCE. Lessee agrees to keep the Equipment insured to protect all
interest of Lessor against all risks of loss and/or damage from any cause
whatsoever until the earlier of (a) delivery by Lessee of possession of the
Equipment to Lessor, or (b) payment by Lessee of all amounts due under the
Lease. Lessee shall keep the Equipment insured in such amounts, in such
forms and with such insurers satisfactory to Lessor, including, but not
limited to, fire and extended coverage insurance, explosion and public
liability and property damage liability. Said insurance shall cover the
interest of both the Lessor and Lessee in the Equipment, and shall name
Lessor as loss payee. The proceeds of said loss or damage insurance shall be
payable to Lessor, but Lessor shall remit all such insurance proceeds to
Lessee at such time as Lessee either (i) provides Lessor satisfactory proof
that the damage has been repaired and the Equipment has been restored to
good working order and condition, or (ii) the Equipment has been replaced
with like Equipment in first class condition and repair. All such insurance
shall provide for thirty (30) days prior written notice to Lessor of
cancellation, restriction or reduction of coverage. Certificates,
endorsements and copies of all policies of insurance shall be delivered to
Lessor upon request.
14. NET LEASE/INDEMNITY/TAXES. This is a net lease, and Lessee hereby
indemnifies Lessor against and holds Lessor harmless (on a net after tax
basis) from any and all claims, (including tax claims) actions, suits,
proceedings, costs, expenses, damages and liabilities, including reasonable
attorney fees, arising out of or connected with the Equipment or the
delivery, use, ownership, lesae or possession thereof, or arising out of any
failure by Leasee to perform or comply with any of the terms and conditions
of this Lease. Lessee should be responsible for the timely payment and
discharge of all license and registration fees, personal property taxes and
other taxes now or hereafter imposed by any federal, state, or local
government upon the Equipment whether the same be assessed to Lessor or
Lessee. The indemnities contained in this paragraph shall continue in full
force and effect notwithstanding the termination of this Lease, whether by
expiration of time, by operation of law, or otherwise.
15. SURRENDER/HOLDOVER. Upon default, or upon earlier termination of the Lease,
Lessee at its expense, and with all shipping and handling costs prepaid,
shall return the Equipment in first class condition and repair, ordinary
wear and tear excepted, by delivering said Equipment to Lessor's corporate
office or to such other place as Lessor may specify. Lessee shall, upon
demand by Lessor, pay to Lessor all amounts expended by Lessor to bring the
Equipment to first class condition and repair, ordinary wear and tear
excepted. This obligation of Lessee shall survive the expiration or earlier
termination of this Lease. In the event of holdover after expiration of the
Basic Term, Lessee shall also pay to Lessor an amount equal to the daily
equivalent of the Basic Rent until the Equipment is returned to Lessor;
provided that nothing herein shall be deemed to prevent Lessor, by written
release, from abandoning its interest in the Equipment in place to Lessee
without liability therefor.
16. NOTICES. All notices shall be in writing and sent by first class mail and
shall be deemed to have been given when deposited in the U.S. mail with
postage prepaid and properly addressed. The addresses of the parties shall
be as indicated on this Lease or changed in accordance herewith.
17. LESSOR'S PERFORMANCE OPTION. Should Lessee fail to make any payment or to do
any act as provided by this Lease, then Lessor shall have the right (but not
the obligation), with or without notice to Lessee of its intention to do so
and without releasing Lessee from any obligation hereunder to make or to do
the same, to pay, purchase, contest or compromise any insurance premium,
encumbrance, charge, tax, lien or other sum which may affect the value of
the Equipment and/or Collateral. All sums so incurred or expended by Lessor
shall be due and payable by Lessee to Lessor within ten (10) days of notice
thereof.
18. EVENTS OF DEFAULT. The occurrence of any of the following events shall, at
the option of Lessor, constitute an event of default under this Lease and/or
any Schedule: (a) the nonpayment by Lessee of any Basic Rent when due; or
the nonpayment by Lessee of any other sum required hereunder which
nonpayment continues for a period of ten (10) days following written notice
thereof from Lessor; (b) the failure of Lessee to perform or observe any
other term, convenant or condition of this Lease, any Schedule or any other
document, agreement or instrument executed pursuant hereto or in connection
herewith which is not cured within ten (10) days after written notice
thereof from Lessor; (c) Lessee ceases doing business as a going concern or
commences or has commenced against it any dissolution or liquidation
proceeding, is insolvent, has a trustee, receiver or custodian appointed for
it or for a substantial part of its assets, makes an assignment for the
benefit of creditors, is generally not paying its debts as they become due,
commences or has commenced against it, or suffers, approves, acquiesces in
or consents to a bankruptcy proceeding or any proceeding seeking relief by
way of reorganization, arrangement or composition under any present or
future statute, law or regulation; (d) Lessee attempts, incurs or suffers a
major rearrangement of its debt, (e) Lessee defaults or otherwise has
accelerated against in any material obligation under any credit agreement,
loan agreement, conditional sales contract, lease, indenture, debenture or
other instrument, or Lessee defaults under any agreement or instrument now
existing or hereafter made with Lessor or with any Lessor's affiliates; (f)
the breach or repudiation by any party thereto of any guaranty,
subordination agreement or other agreement or instrument running in favor or
Lessor obtained in connection with this Lease, or such party's dissolution,
death, insolvency, or bankruptcy.
19. REMEDIES. Should any event of default occur, Lessor may, with or without,
notice or demand upon Lessee, pursue and enforce, successively and/or
concurrently, any one or more of the following remedies: (a) pursue its
remedies under Section 18: (b) WITH OR WITHOUT RETAKING POSSESSION OF THE
EQUIPMENT, with or without judicial process and without liability to Lessee
therefor which is hereby expressly waived, (1) terminate the Basic Term as
to the equipment, (2) accelerate all Basic Rents and cause the then worth
thereof to become immediately due and payable; (3) from time to time recover
from Lessee any accrued and unpaid Basic Rents and other amount owing under
the terms hereof, (4) sell the Equipment at public or private sale, and
recover from Lessee the difference, if any, by which the net proceeds of
sale shall be less than (i) the Lessor's then applicable net investment in
the Equipment and the Lease, plus (ii) the then worth to Lessor of its
anticipated remaining loss of bargain, (5) lease or rent the Equipment to a
third party for the account of Lessee and recover from Lessee when becoming
due any deficiency between the Basic Rents provided herein, and those
amounts received and receivable from such third party over the remaining
Basic Term; (c) pursue any other remedy Lessor may otherwise have hereunder,
at law, in equity (including specific performance) or under any statute any
recover such other actual damages as may be incurred by Lessor. Lessor's
pursuit and enforcement of any one or more remedy shall not be deemed an
election of, or waiver by, Lessor of any other or further remedy, provided,
however, Lessor shall not be entitled to duplicate relief or recovery with
respect to any specific element of Lessor's damages. In addition, Lessor
shall attempt in good faith to mitigate its damages, but Lessor shall not be
obligated to sell or lease the Equipment, but in the event of any such sale,
Lessor and its affiliates may bid upon and purchase the Equipment. Any sale
or lease may be held at such place or places as are selected by Lessor, with
or without having the Equipment present. Lessee agrees, at Lessor's option,
to permit Lessor to lease the Equipment in place without charge or liability
to Lessor, and to permit Lessor to conduct a sale or lease therefrom, and in
furtherance thereof, to permit appraisers, offerees and auctioneers
reasonable and timely access to view, inspect, sell, purchase and remove the
Equipment. Any such sale or lease may be at wholesale or retail, in bulk or
in parcels. He further agrees, upon the sale or lease of the Equipment
occasioned by Lessee's default hereunder, to pay Lessor an amount equal to
any and all disassembly, transportation and reinstallation costs and
expenses incurred by any party with respect to redeployment of the
Equipment. Lessor may accept past due payments without modifying the terms
of the Lease and without waiving any further rights of Lessor.
20. INTEREST/SERVICE CHARGE. Any amounts required to be paid by Lessee pursuant
to the Lease, and not paid when due shall bear interest each day at the
lessor of (18%) eighteen percent per annum or the highest legal contract
rate from the date when such amount was due until paid. Lessee shall also
pay, as indemnity, but not as interest, an additional service charge equal
to the greater of $10.00 or an amount equal to 5% of any such unpaid
amounts. Nothing herein shall be deemed to require the assessment or payment
of any amounts not otherwise legally recoverable by Lessor.
21. COSTS/ATTORNEY'S FEES: In the event of any actions or suits by reason of
Lessee's breach of this Lease, or in connection with the enforcement of any
right or remedy hereunder, Lessor employs the services of any attorney to
enforce, construe or defend any of the terms of this Lease. Lessee, in
addition to all other sums which Lessee may be called upon to pay under the
provisions of this Lease, will pay and/or reimburse Lessor for costs of
collection, other identifiable or out-of-pocket costs and expenses and any
attorney's fees on account thereof reasonably incurred by Lessor.
22. APPLICABLE LAW. This Lease, and all ancillary document issued or executed
pursuant hereto and the rights and obligations of the parties hereunder and
thereunder shall be governed by the laws of the State of Minnesota. In the
event any provision hereof shall be deemed invalid or unenforceable, the
remaining provisions hereof shall remain in full force and effect. Lessee
hereby expressly and irrevocably agrees that Lessor may bring any action or
claim to enforce the provisions of this Lease in the State of Minnesota and
Lessee hereby irrevocably consents to personal jurisdiction in the
appropriate State of Minnesota or Federal Court therein. Lessee hereby
further irrevocably consents to service of process, in accordance with the
provisions of the laws of the State of Minnesota. Nothing herein shall be
deemed to preclude or prevent Lessor from bringing any action or claim to
enforce the provisions of this Lease in any other appropriate place or
forum.
23. WAIVER. No failure nor delay on the part of Lessor in the exercise of any
power, right or privilege hereunder, or to object to the mode of any
tendered performance shall operate as a waiver of the terms hereof, nor
shall any single or partial waiver be construed to preclude future exercise
by Lessor of its rights, powers and privileges.
24. MISCELLANEOUS. Time is of the essence of this Lease and each and all of its
provisions. Section headings are used for convenience only and shall not
otherwise affect the provisions of this Lease. THIS LEASE MAY ONLY BE
AMENDED OR ALTERED BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED
OFFICER OF LESSOR. ALL REPRESENTATIONS, AGREEMENTS, INDEMNITIES AND
WARRANTIES OF LESSEE MADE HEREIN AND REMEDIES OF LESSOR SHALL SURVIVE
TERMINATION OF THIS LEASE AND ANY SCHEDULE.