Exhibit 10.50
MASTER LEASE No. 16378-00900
Dated: As of April 1, 2006
Between: Banc of America Leasing & Capital, LLC ("Lessor")
Located at: 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
1. AGREEMENT TO LEASE PROPERTY. Lessor agrees to lease to Lessee and Lessee
agrees to lease from Lessor the personal property ("Equipment") described
in any schedule of Equipment executed by the parties substantially in the
applicable form attached hereto as Exhibit A ("Equipment Schedule"), or in
such other form as the parties may agree in writing. Each Equipment
Schedule shall, except as otherwise may be agreed in writing, incorporate
the terms of this Master Lease-Finance Agreement (hereinafter "Master
Lease"). Each Equipment Schedule shall, together with the incorporated
terms of this Master Lease, constitute a separate lease agreement
("Lease"). If there is a conflict between the language of this Master Lease
and the language of an Equipment Schedule, the latter shall prevail with
respect to the Lease comprising the Master Lease and such Equipment
Schedule,
2. TERM. This Master Lease shall commence on the date set forth above. Each
Lease shall continue for the period described in the Equipment Schedule
applicable thereto (hereinafter the "Term"); provided that if the Lease
does not require the Lessee to purchase the Equipment at the end of the
Term stated in the Equipment Schedule, the Lease shall not terminate at the
end of such Term unless either Lessor or Lessee has delivered to the other
at least one hundred and eighty (180) days prior written notice of such
termination, failing which the Term will extend automatically until a
period of one hundred and eighty (180) days has elapsed from the date when
written notice of termination was delivered by either party to the other.
Any such automatic extension shall be deemed included in and part of the
Term of the Lease, and Lessee shall continue to pay the periodic rentals
and comply with all other terms and conditions of the Lease until the Lease
terminates.
3. ACCEPTANCE. Lessee shall inspect the Equipment immediately upon its
delivery and installation at Lessee's premises. If Lessee determines that
the Equipment has been delivered, installed, and is operating according to
the manufacturer's or supplier's specifications. Lessee shall promptly
execute and deliver to Lessor a certificate of acceptance of such Equipment
prepared by Lessor substantially in the form attached hereto as Exhibit B
(hereinafter "Certificate of Acceptance"). The description of Equipment
contained or incorporated by reference in any Certificate of Acceptance
executed by Lessee, shall be deemed to be incorporated in the Equipment
description in the Equipment Schedule. If there is a conflict between a
description in an Equipment Schedule and a description in an executed
Certificate of Acceptance, the latter shall prevail, and the Equipment
Schedule description shall be deemed to be amended or supplemented
accordingly. Lessee authorizes Lessor to make and initial, on behalf of
both Lessor and Lessee, amendments or additions to the description of
Equipment contained in the Equipment Schedule to ensure that such
description is complete, fair and accurate, including but not limited to
amendments or additions relating to invoice or serial numbers, or, with
Lessee's consent, to the cost of items of Equipment. Lessor shall not pay
for any item of Equipment under a Lease if Lessee is in default of any of
its obligations thereunder.
4. RENT. Lessee shall pay all rentals pursuant to the applicable Equipment
Schedule (the "Rent") on or before the due dates thereof for the entire
Term of each Lease. All Rents shall be deemed earned in full when paid,
5. OBLIGATION TO PAY RENT UNCONDITIONAL. Each lease is a net lease and is
non-cancelable for its entire term. Lessee's obligation to pay Rent and all
other sums under each Lease, and the rights of Lessor or its assigns in and
to such payments, shall be absolute and unconditional, and shall not be
subject to any abatement, reduction, setoff, defense, counterclaim or
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recoupment due or alleged to be due to, or by reason of, any past, present
or future claims which Lessee may have against Lessor or its assigns, or
any manufacturer or supplier of the Equipment, or against any other person,
for any reason whatsoever including, without limitation, any reason
relating to the fitness, design, quality, materials, workmanship, or
condition of the Equipment, or to its merchantability, or to its fitness,
capacity or durability for any particular purpose, or to any latent or
patent defect in the Equipment, or to any actual or alleged patent,
copyright, or trade secret infringement relating to the Equipment, or to
the Equipment's compliance with the requirements of any applicable law,
rule, specification or contract.
6. TITLE. Lessee shall have no right, title or interest in the Equipment,
except as expressly set forth in the Lease. All Equipment shall remain
personal property and title thereto shall at all times remain in the Lessor
or its assigns exclusively. All documents of title and evidences of
delivery shall be delivered to Lessor. Lessee hereby assigns to Lessor all
and any right, title, and interest it has or may have in and to the
Equipment, and in and to Lessee's rights, but not obligations, under any
contract or document relating to the Equipment, as of the date of such
contract or document, including without limitation any purchase order or
invoice for the Equipment. Lessee will not change or remove any insignia or
lettering on the Equipment indicating Lessor's ownership thereof. Upon
Lessor's request. Lessee shall affix to the Equipment in a prominent place,
labels, plates or other markings stating that the Equipment is owned by
Lessor. Lessor is hereby irrevocably authorized and appointed by Lessee as
its attorney-in-fact to execute, file and record on Lessee's behalf and at
Lessee's expense, any financing statement or other instrument recording or
giving notice pursuant to applicable law of the interest which Lessor may
now have or hereafter may acquire in any Equipment or Lease, including
without limitation any financing statement or fixture filing under the
Uniform Commercial Code ("UCC"), and any amendment, assignment, termination
or continuation thereof. Lessee furthermore agrees to execute and deliver
any statement or instrument reasonably required by Lessor for such purpose.
Lessee shall, at Lessee's expense, protect and defend Lessor's title
against all persons claiming against or through Lessee, and shall at all
times keep the Equipment free from any legal process or encumbrances
whatsoever, including but not limited to liens, levies and attachments, and
shall give Lessor immediate written notice of any threatened or actual
legal process or encumbrance affecting or relating to the Equipment, and
shall indemnify Lessor from any loss caused thereby. If a Lease is for any
reason held not to be a true lease but a lease intended as security. Lessee
shall be deemed to have granted Lessor a first security interest in the
Equipment and the proceeds thereof, the Lease, and any related collateral.
7. WARRANTY AND LIMITATION OF LIABILITY. Lessor warrants and represents that
as long as Lessee shall not be in default of any of the provisions of the
Lease, neither Lessor, nor any assignee or secured party of Lessor will
disturb Lessee's use or possession of the Equipment and Lessee's
unrestricted use thereof for its intended purpose. LESSOR MAKES NO OTHER
WARRANTY EXPRESS OR IMPLIED AS TO ANY MATTER WHATSOEVER. LESSEE
ACKNOWLEDGES THE FOLLOWING: (A) LESSEE HAS INDEPENDENTLY AND WITHOUT
RECEIPT OF OR RELIANCE UPON ANY WARRANTY, REPRESENTATION OR INFORMATION OF
ANY KIND FROM LESSOR IN RELATION THERETO, SELECTED BOTH THE EQUIPMENT AND
THE SUPPLIER OF THE EQUIPMENT, WHICH IS OF THE SIZE, DESIGN. CAPACITY, AND
DESCRIPTION SELECTED BY LESSEE; (B) LESSOR IS NOT THE MANUFACTURER,
SUPPLIER OR DISTRIBUTOR OF THE EQUIPMENT, NOR THE AGENT OF ANY OF THEM, NOR
ARE ANY OF THEM LESSOR"S AGENT FOR ANY PURPOSE; (C) LESSOR HAS NOT MADE AND
DOES NOT MAKE ANY WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, OF ANY
KIND WHATSOEVER WITH RESPECT TO THE EQUIPMENT, INCLUDING BUT NOT LIMITED TO
ANY WARRANTY OR REPRESENTATION RELATED TO: (1) THE FITNESS. DESIGN QUALITY,
MATERIALS, WORKMANSHIP OR CONDITION OF THE EQUIPMENT, OR ITS
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MERCHANTAB1LITY OR ITS FITNESS, CAPACITY OR DURABILITY FOR ANY PARTICULAR
PURPOSE; (2) ANY LATENT DEFECTS IN THE EQUIPMENT; (3) ANY PATENT,
COPYRIGHT, OR TRADE SECRET INFRINGEMENT; AND (4) THE EQUIPMENT'S COMPLIANCE
WITH THE REQUIREMENTS OF ANY LAW, RULE, SPECIFICATION OR CONTRACT
PERTAINING THERETO. LESSEE WILL HAVE THE BENEFIT OF ANY MANUFACTURER'S
WARRANTIES ON THE EQUIPMENT. LESSOR SHALL HAVE NO LIABILITY TO LESSEE FOR
ANY CLAIM, LOSS OR DAMAGES. INCLUDING WITHOUT LIMITATION ANY CONSEQUENTIAL,
INCIDENTAL, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES, CAUSED OR ALLEGED TO BE
CAUSED DIRECTLY, INDIRECTLY, INCIDENTALLY OR CONSEQUENTIALLY BY THE
EQUIPMENT, BY ANY INADEQUACY THEREOF OR DEFICIENCY OR DEFECT THEREIN, BY
ANY CAUSE OR INCIDENT WHATSOEVER IN CONNECTION THEREWITH, WHETHER ARISING
IN STRICT LIABILITY. NEGLIGENCE, CONTRACT, EQUITY OR OTHERWISE. OR IN ANY
WAY RELATED TO OR ARISINGOUT OF THE LEASE. The parties Intend the Lease to
be a "Finance Lease" as defined in Article 2A-103(g) of the UCC; provided
that If contrary to such intention the Lease does not constitute a Finance
Lease, the Lease shall nevertheless bind the parties fully pursuant to its
terms. Lessee has either (a) reviewed and approved any written "Supply
Contract" with the "Supplier" (as such terms are defined in the UCC) of the
Equipment, or (b) Lessor has Informed or advised Lessee in writing, either
previously or by the Lease, (i) of the identity of the Supplier (unless
Lessee itself selected the Supplier and directed Lessor to acquire the
Equipment from such supplier), (ii) that Lessee may have rights under the
Supply Contract, and (iii) that Lessee may contact the Supplier for a
description of any such rights. Without limiting the foregoing. Lessee
shall look solely and exclusively to the supplier or manufacturer of the
Equipment, not to Lessor, for the rights and benefits under any applicable
supplier's or manufacturer's warranties, express or implied, relating to
the Equipment. To the extent, if any, that the rights and benefits under
such warranties may vest in Lessor and may be assignable, such rights and
benefits are hereby assigned by Lessor to Lessee, without any recourse
whatsoever to Lessor. Lessee shall at its sole expense take all reasonable
action to enforce such warranties where available to Lessee.
8. INDEMNITY. Lessee agrees to defend, indemnify and hold Lessor harmless from
any and all claims, losses, liabilities (including contract, negligence,
tort and strict liability), damages and/or legal proceedings, groundless or
otherwise, including any liability for legal costs, fees and expenses,
relating to or arising from any Lease or Equipment, including, without
limitation, the Equipment's quality, design, manufacture, durability,
materials, selection, purchase, delivery, possession, condition, fitness or
suitability for any purpose, compliance with any law, regulation or
specification, use, operation, maintenance, or return. The liabilities
indemnified against by Lessee shall include, without limitation, any actual
or alleged liability based on any theory arising in contract, negligence,
tort, or equity, including but not limited to any theory of strict
liability or products liability. Lessee's obligations hereunder will
survive the Term of the Lease with respect to acts or events occurring or
alleged to have occurred prior to termination of the Lease or the return of
the Equipment to Lessor.
9. INSTALLATION, MAINTENANCE AND REPAIR.
(a) Lessee shall at its expense; (i) be responsible for the delivery,
installation, maintenance, service and repair of the Equipment; (ii) use
the Equipment only in the regular and lawful course of Lessee's business,
within its normal capacity, without abuse, and in a manner contemplated by
the manufacturer; (iii) not make any modification, alteration or addition
to the Equipment (other than the addition of normal operating accessories
or controls! without the consent of Lessor, which shall not be unreasonably
withheld; (iv) protect the Equipment from deterioration; and (v) maintain
in force a standard maintenance agreement with the manufacturer or other
party reasonably acceptable to Lessor, for the repair, service and
maintenance of the Equipment in good operating condition, repair and
appearance, reasonable wear and tear excepted. Nothing herein shall absolve
Lessee from its obligation to furnish a certificate from the manufacturer
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of the Equipment upon surrender of the Equipment pursuant to Section 14.
(b) Lessee shall not affix the Equipment to realty in such manner as to
change its nature to real property or to cause it to become a fixture
pursuant to applicable law. Lessee agrees that the Equipment shall remain
personal property at all times regardless of how attached or installed,
shall remain at the location shown in the Equipment Schedule and shall not
be removed therefrom without the written consent of Lessor. All
modifications, repairs, alterations, additions, operating accessories and
controls shall accrue to the Equipment and become the property o-f Lessor.
Lessor shall have the right, during Lessee's normal business hours, and
subject to any applicable laws and regulations, to enter upon the premises
where the Equipment is located in order to inspect, observe, or remove the
Equipment or otherwise to protect Lessor's interest therein, and Lessee
shall cooperate in affording Lessor the opportunity to do so.
10. TAXES. All taxes, assessments, license fees, and other charges or levies,
including, without limitation, any personal property tax, sales tax or use
tax, imposed or assessed by any lawful authority upon or against either
Lessee or Lessor (except for Federal or State income taxes or franchise
taxes payable by Lessor), relating to the ownership, possession, rental or
use of the Equipment during the Term of the Lease, shall be paid by Lessee
before the same shall become delinquent. To the extent possible under any
applicable law relating to personal property taxes. Lessee shall include
the Equipment on personal property tax returns which shall be timely filed
by Lessee, and Lessee shall timely pay any such taxes payable with respect
to the Equipment. If Lessor is required to file such returns, Lessee will
promptly furnish to Lessor any information which Lessor reasonably requires
to make and file such returns in a timely manner. If Lessee fails to pay
any taxes, assessments, fees or other charges or levies for which it is
liable pursuant to this Section, Lessor may pay all or any part thereof,
and Lessee shall immediately reimburse Lessor in full for the amount so
paid by Lessor. Lessee authorizes Lessor to add to the amount of any Rent,
any sales or use tax, or similar charges or levies, that may be imposed on
or measured by such Rent.
11. INSURANCE. Lessee shall at all times maintain, at its own expense: (a)
all-risk insurance covering physical loss of or damage to the Equipment
from every insurable cause whatsoever for an amount no less than the higher
of the "Casualty Loss Value", as that term is defined in Section 12
hereunder, or the full replacement value of the Equipment; and (b)
comprehensive general liability and umbrella liability insurance covering
all insurable exposures for bodily injury and property damage relating to
the Equipment and/or its use and/or operation (including, without
limitation, contractual liability and products liability), in such amounts,
against such risks, and with such insurers, as shall be satisfactory to
Lessor. Lessor shall with respect to each policy of insurance referred to
herein, be named as an additional insured and loss payee pursuant to a
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standard long form endorsement to such policy. Each such policy and/or
endorsement shall provide that (i) the coverages afforded thereby to Lessor
shall not be canceled or materially changed for any reason without at least
thirty (30) days' prior written notice to Lessor; (ii) Lessor's coverage
under and interest in the policy shall not be invalidated or otherwise
adversely affected by any breach by Lessee or others of any warranty,
declaration, representation or condition contained in such policy. Lessor
is hereby irrevocably authorized to file any claim or proof of loss under
or in connection with any insurance policy maintained by Lessee pursuant to
this Section 11.
12. LOSS OR DAMAGE. Lessee shall bear the entire risk of any destruction or
loss of or damage to the Equipment or any item thereof for any reason
whatsoever, including without limitation, theft, governmental taking, war,
strike or Act of God. Lessee shall promptly notify Lessor of any Loss or
Damage, and no such event shall relieve Lessee of its obligation to pay the
full Rent or any other obligation under the Lease. In the event of any Loss
or Damage, Lessee shall at its expense, subject to the option and direction
of Lessor: (a) repair any damaged Equipment to the same good condition and
repair it was in prior to the Damage; or (b) replace any Equipment which
Lessor determines has been damaged beyond repair, or which has been lost,
with like Equipment, free of any liens or encumbrances, in good condition
and repair; or (c) pay to Lessor upon written demand an amount (hereinafter
the "Casualty Loss Value") equal to the sum of: (i) any Rent or other
amounts then due under the Lease; (ii> the present value, based on an
discount rate of 5% per annum, of any future unpaid Rent payments for the
balance of the Term of the Lease; and (iii) the present value, based on a
discount rate of 5% per annum, of the amount of any purchase option or
requirement stated in the Lease or, where such options or requirements are
not so stated, the amount of the fair market value of all the Equipment at
the end of the Term of the Lease. For the purposes of this Section and any
Lease, the fair market value of Equipment shall be the amount which an end
user thereof, negotiating at arm's length, would pay at retail for such
Equipment assuming that it was already installed and operational at the
location where it will be used. The Lease shall terminate upon payment of
the Casualty Loss Value, whereupon all Lessor's right, title, and interest
in the Equipment shall vest in Lessee or Lessee's insurer according to
their respective interests, "as is, where is" in the then condition and
location of the Equipment, and without warranty, express or implied. The
proceeds, if any, received by Lessor from any all-risk insurance maintained
at Lessee's expense pursuant to Section 11 hereof, shall be applied by
Lessor to reimburse Lessee for expenses incurred at Lessor's option and
direction in the repair or replacement of lost or damaged Equipment
pursuant to this Section, or shall be remitted in full to Lessee if Lessee
has upon Lessor's demand paid the Casualty Loss Value.
13. ASSIGNMENT.
(a) Lessor may transfer, assign, and sell, and/or grant a security
interest in, all or any portion of its right, title, and interest in
and to the Equipment, the Lease and/or the Rents or other amounts
payable thereunder, to a third party (hereinafter an "Assignee"), and
any reference in such Lease to "Lessor" shall thereupon also be deemed
to be reference to Assignee. Lessee hereby: (i) consents to any such
transfer, assignment, sale and/or grant; (ii) agrees to promptly
execute and deliver any instrument as may reasonably be requested by
Assignee from time to time to give effect to such transfer,
assignment, sale and/or grant, including an acknowledgment by Lessee
of its continuing unconditional obligations under the Lease as set
forth in Section 5 hereof; and (iii) acknowledges that any such
transfer, assignment, sale and/or grant shall not materially change
Lessee's duties or obligations under the Lease nor materially increase
the burdens or risks imposed on Lessee, or obligate Assignee to
perform the obligations, if any, of Lessor under the Lease, except
that Assignee shall allow Lessee quiet enjoyment of the Equipment for
so long as Lessee complies with all the provisions of the Lease, and
shall pursuant to the Lease apply any proceeds which Assignee may
receive from insurance maintained by Lessee at Lessee's expense
pursuant to Section 11. (b) Lessee's obligation to pay, and Assignee's
right to receive, the Rents and other sums due under a Lease, shall be
absolute and unconditional as more fully set forth in Section 5
hereof, and, without limitation, shall be unaffected by any failure by
Lessor to perform any obligation under the Lease, without prejudice to
such recourse, if any, which Lessee separately may have against Lessor
arising from such failure. (c) LESSEE SHALL NOT WITHOUT THE PRIOR
WRITTEN CONSENT OF LESSOR: (i) ASSIGN OR IN ANY WAY DISPOSE OF ALL OR
ANY PART OF ITS RIGHTS OR OBLIGATIONS UNDER THE LEASE; OR (ii) ENTER
INTO A SUBLEASE OF ALL OR ANY PART OF THE EQUIPMENT.
14. SURRENDER OF EQUIPMENT. Lessee shall upon termination of a Lease return the
Equipment to Lessor at Lessee's expense, subject to the following: (a) not
less than thirty (30) days before such return. Lessee shall provide Lessor
with a written inventory of the Equipment, including model and serial
numbers, details of current manuals, and with all other technical data in
Lessee's possession required for the set-up and operation of the Equipment;
(b) not less than ten (10) days before such return. Lessee shall provide
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Lessor with a certificate by the manufacturer or a qualified equipment
maintenance provider acceptable to Lessor, to the effect that the Equipment
has been properly inspected, examined and tested, is in good operating
condition, repair and appearance, reasonable wear and tear excepted, and
will be eligible upon re-sale or re-lease by Lessor, for the manufacturer's
standard maintenance agreement for Equipment of comparable age and type;
(c) the Equipment shall be returned in the same good order and condition in
which it is required to be certified, as set forth above, and will be
thoroughly cleaned and cosmetically acceptable for immediate installation
in a similar environment; (d) the Equipment shall be returned to the
location designated by Lessor within the continental United States; (e) if
Lessee for any reason fails to return the Equipment to Lessor within ten
(10) days of termination of the Lease, Lessee shall pay as liquidated
damages an amount equal to one hundred and five percent (105%) of the
monthly rental payment set forth in the Lease for each month or part
thereof that elapses before the Equipment is received by Lessor, without
prejudice to Lessor's right, without notice, demand, or legal process,
(except as applicable law may require), to enter into the premises where
the Equipment is then located and to repossess and remove it, without
liability to Lessee for injury or loss suffered through or caused thereby,
and all rights of Lessee in the Equipment so repossessed shall terminate
absolutely; (f) the provisions of this Section 14 shall not apply if Lessee
duly purchases the Equipment from Lessor pursuant to its rights at the end
of the Term of any Lease.
15. OTHER COVENANTS AND WARRANTIES OF LESSEE.
(a) Lessee shall promptly pay all costs, expenses and obligations of every
kind and nature incurred in connection with the use or operation of
the Equipment which may arise or become due during the Term of the
Lease, whether or not specifically mentioned herein.
(b) The information, statements and financial reports submitted by Lessee
to Lessor from time to time are material inducements to the execution
by Lessor of any Lease thereafter executed between Lessor and Lessee.
Lessee warrants that such information, statements and reports will be
true and correct in all material respects as of the date submitted.
(c) Lessee shall during the Term of any Lease furnish to Lessor: (i)
within one hundred and twenty (120) days after the end of each fiscal
year of Lessee, the complete audited financial statements of Lessee as
at the end of such fiscal year and for the period then ended; (ii)
within sixty (60) days after the end of each quarter of each fiscal
year of Lessee, interim financial statements reflecting the financial
condition of Lessee as at the end of such quarter and the results of
its operations and cash flows for the period then ended, prepared in
accordance with generally accepted accounting principles, and
certified as such by Lessee; and (iii) such other financial
information regarding the business affairs and financial condition of
Lessee as Lessor may reasonably request from time to time.
(d) If any Rent or other payment is not paid by Lessee within ten (10)
days of its due date under a Lease, Lessee shall, in addition to such
Rent, immediately be liable to pay liquidated damages in an amount
equal to the lesser of: (i) five percent (5%) of such late payment, or
(ii) the maximum liquidated damages, late charge, or equivalent such
charge, as the applicable law allows in such circumstances. Such
liability shall be in addition to any other amounts payable by Lessee
as a result of the exercise by Lessor of any of its other remedies
under a Lease.
(e) Lessee warrants that this Master Lease and any Lease hereunder is and
shall be duly authorized, and that no provision herein or in any Lease
is or shall be inconsistent with Lessee's charter, by-laws, or any
loan or credit agreement or other instrument to which Lessee is a
party or by which Lessee or its property may be bound or affected.
(f) Lessee, if a corporation or other form of organization, shall not
merge or consolidate with any other person or entity, or change its
identity, without Lessor's written consent, which shall not be
unreasonably withheld.
16. PERFORMANCE BY LESSOR OF LESSEE'S OBLIGATIONS. If Lessee fails to comply
with any of the provisions of a Lease, Lessor shall have the right, but not
the obligation, to effect such compliance on behalf of Lessee. In that
event, all monies spent and all liabilities and expenses incurred by Lessor
in effecting such compliance will immediately be due and payable by Lessee
to Lessor.
17. DEFAULT. The occurrence of any one of the following events shall constitute
an Event of Default under a Lease:
(a) Any default by Lessee in the due and timely payment of Rent or any
other amount due under such Lease, which continues for five (5) days
after receipt of written notice thereof from Lessor;
(b) Lessee's breach of any warranty hereunder, or its failure to furnish
and maintain insurance pursuant to Section 11 hereof;
(c) Any default by Lessee in the performance of any other covenant, term
or condition hereunder, which default continues for ten (10) days
after receipt of written notice thereof from Lessor;
(d) Lessee's insolvency or any assignment by Lessee for the benefit of its
creditors;
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(e) Any application by Lessee for, or Lessee's consent to, the appointment
of a receiver, trustee, conservator or liquidator of Lessee or of all
or a substantial part of its assets, or the appointment of such
receiver, trustee, conservator or liquidator without the application
or consent of Lessee;
(f) The filing of a petition by or against Lessee under the Bankruptcy Act
or any amendment thereto (including, without limitation, a petition
for reorganization, arrangement or extension) or under any other
insolvency law or laws providing for the relief of debtors, unless:
(i) Lessee promptly and diligently prosecutes an action to dismiss
such petition; and (ii) such petition is dismissed within thirty (30)
days of such filing;
(g) Lessee's abandonment of, or attempt without Lessor's prior written
consent to remove, sell, assign, transfer, sublet or part with the
possession of, any item of Equipment or any of its rights or
obligations under a Lease; or,
(hi Any representation or warranty made by Lessee in this Master Lease, or
in any Equipment Schedule, or in any document furnished by Lessee to
Lessor or Assignee in connection with this Master Lease or any
Equipment Schedule or with respect to the acquisition or use of the
Equipment, which is untrue in any material respect.
(i) The bankruptcy of any guarantor of Lessee's obligations under such
Lease, or any attempt by such guarantor to renounce or repudiate any
of its guaranty obligations relating to such Lease.
18. REMEDIES. If an Event of Default occurs under a Lease, Lessor may with
respect to such Lease elect to do one or more of the following, all of
which are hereby authorized by Lessee: (a) Cause Lessee, immediately upon
written demand, to pay to Lessor, as liquidated damages and not as a
penalty, the "Default Value", which shall be the sum of: (i) the Casualty
Loss Value of the Equipment on the date of such Event of Default; and (ii)
any and all costs and expenses incurred by Lessor in connection with the
enforcement of any of Lessor's remedies hereunder, including all expenses
of repossessing, storing, shipping, repairing and selling the Equipment,
and all legal and administrative costs and expenses related thereto,
including reasonable in-house administrative and legal costs, and the costs
and attorneys' fees of outside counsel; b) Unless and until the Default
Value has been paid in full. Lessor may: (i) cause Lessee, upon written
demand of Lessor and at Lessee's expense, promptly to return the Equipment
to Lessor in accordance with Section 14 hereof, or may without demand or
legal process, except as may be required by applicable law, enter into the
premises where the Equipment may be found and take possession of and remove
such Equipment, without liability for injuries suffered through or loss
caused by such repossession, and may ship, store and/or repair such
Equipment, whereupon all rights of Lessee in such Equipment shall terminate
absolutely; and (ii) upon return or repossession of the Equipment may, in
Lessor's reasonable discretion, lease or sell such Equipment, with or
without notice and by public auction or private bid, but subject to the
requirements of any applicable law, and the proceeds of such lease or sale
shall be applied to paying Lessor an amount equal to the Default Value, to
the extent not previously paid by Lessee. If the sum of the lease or sale
proceeds and any previous payments by Lessee towards the Default Value, is
less than the Default Value, Lessee shall remain liable to pay such
shortfall to Lessor. Any surplus remaining thereafter will be retained by
Lessor. All remedies of Lessor hereunder are cumulative, are in addition to
any other remedies provided for by law and may, to the extent permitted by
law, be exercised concurrently or separately, and the exercise of any one
remedy shall not be deemed to be an election of such remedy or to preclude
the exercise of any other remedy. No failure on the part of Lessor to
exercise, and no delay in exercising any right or remedy shall operate as a
waiver thereof or modify the terms of any Lease, nor shall any single or
partial exercise by Lessor of any right or remedy preclude any other or
further exercise of the same or any other right or remedy.
19. LOAN EQUIPMENT SCHEDULES.
(a) Lessor may from time to time agree to lend and advance funds to Lessee
for the purpose of purchasing personal property, and to record the
terms and conditions of such transaction {hereinafter a "Loan") in an
Equipment Schedule which incorporates the terms and conditions of this
Master Lease by reference.
(b) If the parties conclude a Loan by means of such Equipment Schedule:
(i) any reference in this Master Lease to Lessor and Lessee shall be
deemed to be references to Lessor and Lessee in their respective
capacities as Lender and Borrower pursuant to the Loan, and the terms
and conditions of this Master Lease shall mutatis mutandis apply to
the contractual rights and obligations of Lessor and Lessee pursuant
to the Loan, including, without limitation. Lessee's unconditional
obligation to pay periodic repayment amounts under the Loan subject to
the same terms and conditions as apply to Lessee's obligation to pay
Rent under a Lease; (ii) Lessee, in its capacity as Borrower, grants
Lessor, in its capacity as Lender, a security interest in each item of
personal property described as "Equipment" in any Equipment Schedule
recording a Loan, as security for the due and timely fulfillment of
all Lessee's obligations under such Loan.
20. MISCELLANEOUS.
(a) Applicable Law; Consent to Jurisdiction; Waiver of Jury Trial. This
Master Lease and any Lease shall be governed by and construed in
accordance with the laws of the State of New Jersey. Lessee hereby
consents to the non-exclusive jurisdiction of any State or Federal
court of competent jurisdiction located within the State of New
Jersey, for the adjudication of all and any lawsuits, claims,
controversies or proceedings to which Lessor or its assigns may be a
party, arising out of or in connection with any rights. obligations or
interests under this Master Lease, any Lease, and/or any Equipment.
Lessor and Lessee Each Irrevocably Waive All Right to Trial by Jury of
Any Such Lawsuits, Claims, Controversies or Proceedings.
(b) (b) Place and Time of Performance. Each Lease shall be deemed to have
been formed and executed at Lessor's place of business in New Jersey.
Lessee shall pay Rents and any other amounts payable under each Lease
at such place, unless requested otherwise by Lessor or its assignee in
writing. Time is of the essence in the performance of Lessee's
obligations hereunder.
(c) (c) Suspension of Obligations of Lessor. Prior to delivery of any item
of Equipment hereunder, the obligations of Lessor hereunder shall be
suspended to the extent that it is hindered or prevented from
complying therewith because of labor disturbances, including strikes
and lockouts, acts of God, fire, storms, accidents, failure of the
manufacturer to deliver any item of Equipment, governmental
regulations or interference, or any cause whatsoever not within the
sole control of the Lessor.
(d) (d) Partial Validity. If any provision hereof, or its application to
any person or circumstances, shall to any extent be invalid or
unenforceable, the remaining provisions hereof, or the application of
such provision to persons or circumstances other than those as to
which it is invalid or unenforceable, shall not be affected thereby.
(e) Notices. Any notice required or permitted to be given by the
provisions hereof shall be delivered to a party at the address
indicated above (or at such other address as a party shall specify to
the other party in writing) by courier or by registered or certified
mail. Proof of sending such notice shall be the responsibility of
sender.
(f) Amendments. This Master Lease and each Lease constitutes the entire
agreement between Lessor and Lessee and may not be contradicted by
evidence of prior, contemporaneous or subsequent oral discussions,
negotiations or agreements of the parties. There is no understanding,
oral or written, which is not contained herein or therein. This Master
Lease and any Lease hereunder may not be amended except by a written
instrument signed by Lessor and Lessee, except as otherwise permitted
herein or in a lease.
(g) (g) Successors; Survival of Covenants. This Master Lease and any Lease
shall be binding on and inure to the benefit of the parties hereto and
their permitted successors and assigns. All of Lessee's covenants
under this Master Lease and Equipment Schedule(s) shall survive the
delivery and return of the Equipment leased hereunder.
(h) (h) Originality. This Master Lease and any Equipment Schedule or
Certificate of Acceptance shall be executed with only one original,
and only the transfer or assignment of an original Equipment Schedule
shall be effective to transfer Lessor's rights under a Lease, or to
perfect, by possession, a security interest therein.
(i) Banc of America Leasing & Capital, LLC is a Delaware limited liability
company.
Executed as of the date first written above.
LESSOR: Banc of America Leasing & Capital, LLC LESSEE: PHC, Inc.
By: /s/ P. Wesley Yount, III By: /s/ Paula C. Wurts
Name: P. Wesley Yount, III Name: Paula C. Wurts
Title: Senior Vice President Title: CFO
- 44 -
EQUIPMENT SCHEDULE No. 001
Dated: As of April 1, 2006
Under: MASTER LEASE No. 16378-00900 dated as of April 1, 2006
Between: Banc of America Leasing & Capital, LLC ("Lessor")
located at: 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
1. EQUIPMENT DESCRIPTION AND LOCATION: See Attachment A.
2. COMMENCEMENT DATE: The date set forth in the Certificate of Lease
Acceptance as the Lease Acceptance Date.
3. TERM: The lease Term commences on the Commencement Date and continues
for 39 months thereafter.
4. RENT: 39 monthly payments due on the first day of each month,
beginning on the Commencement Date, payable as follows: 3 consecutive
monthly payments of $0.00, followed by 35 consecutive monthly payments
of $6,065.11 followed by 1 consecutive monthly payment of $0.00.
5. EQUIPMENT ACCEPTANCE: It is anticipated that the Equipment will be
delivered to and installed at the Equipment Location over a period of
5 months beginning on the Commencement Date. Lessee shall, as set
forth in Attachment C, periodically execute and deliver to Lessor a
Certificate of Equipment Acceptance, substantially in the form as
Exhibit A hereto which shall: (a) detail those items of Equipment
which have been delivered to and accepted by Lessee during the period
since the last executed Certificate of Equipment Acceptance; and, (b)
serve as authorization for Lessor to pay the Vendors the Cost of the
Equipment listed therein.
6. EQUIPMENT CHANGES: See Attachment B.
7. PAYMENTS TO VENDORS: See Attachment C.
8. PURCHASE: At the end of such lease Term, provided Lessee is not in
default of its obligations hereunder, Lessee shall have the option to
purchase all, but not less than all, of the Equipment for its then
Fair Market Value, which amount Lessee shall pay to Lessor on the last
day of the Term hereof. The term "Fair Market Value" as used herein
shall mean the purchase price that would be obtained in an arm's
length transaction, assuming the Equipment is in good operating
condition and fully installed on the premises where it is to be used.
9. MASTER LEASE: All the terms and conditions of the Master Lease are
incorporated herein by reference as if such terms and conditions were
set forth in this Equipment Schedule. Pursuant to Section 10 of the
Master Lease, Lessee will file any personal property returns and pay
all personal property taxes applicable with respect to the Equipment.
Banc of America Leasing & Capital, LLC is a Delaware limited liability
company.
10. ORIGINALITY: This is the only Original Equipment Schedule No. 001. All
other copies of this Equipment Schedule No. 001 are xerographic copies
only and have been marked as duplicates. Possession of this "Original"
is required to perfect, by possession, a security interest in this
- 45 -
Equipment Schedule as chattel paper under the UCC.
11. Executed as of the date first written above.
LESSOR: BANC OF AMERICA LEASING & CAPITAL, LLC LESSEE: PHC, Inc.
By: /s/ P. Wesley Yount, III By: /s/ Paula C. Wurts
Name: P. Wesley Yount, III Name: Paula C. Wurts
Title: Senior Vice President Title: CFO
- 46 -
EQUIPMENT SCHEDULE No. 002
Dated: As of April 1, 2006
Under: MASTER LEASE No. 16378-00900 dated as of April 1, 2006
Between: Banc of America Leasing & Capital, LLC ("Lessor")
located at: 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
1. EQUIPMENT DESCRIPTION AND LOCATION: See Attachment A.
2. COMMENCEMENT DATE: The date set forth in the Certificate of Lease
Acceptance as the Lease Acceptance Date.
3. TERM: The lease Term commences on the Commencement Date and continues
for 66 months thereafter.
4. RENT: 66 monthly payments due on the first day of each month,
beginning on the Commencement Date, payable as follows: Payments 1 - 6
@ $0.00, followed by payments 7 - 10 @ $3,000.00 followed by payments
11 - 65 @ $9,868.71 followed by payment 66 @ $0.00.
5. EQUIPMENT ACCEPTANCE: It is anticipated that the Equipment will be
delivered to and installed at the Equipment Location over a period of
21 months beginning on the Commencement Date. Lessee shall, as set
forth in Attachment C, periodically execute and deliver to Lessor a
Certificate of Equipment Acceptance, substantially in the form as
Exhibit A hereto which shall: (a) detail those items of Equipment
which have been delivered to and accepted by Lessee during the period
since the last executed Certificate of Equipment Acceptance; and, (b)
serve as authorization for Lessor to pay the Vendors the Cost of the
Equipment listed therein.
6. EQUIPMENT CHANGES: See Attachment B.
7. PAYMENTS TO VENDORS: See Attachment C.
8. PURCHASE: At the end of the Term hereof. Lessee shall, without notice
or demand, purchase the Equipment for $1.00, which amount Lessee shall
pay to Lessor on the last day of the Term hereof.
9. MASTER LEASE: All the terms and conditions of the Master Lease are
incorporated herein by reference as if such terms and conditions were
set forth in this Equipment Schedule. Pursuant to Section 10 of the
Master Lease, Lessee will file any personal property returns and pay
all personal property taxes applicable with respect to the Equipment.
Banc of America Leasing & Capital, LLC is a Delaware limited liability
company.
10. ORIGINALITY: This is the only Original Equipment Schedule No. 002. All
other copies of this Equipment Schedule No. 002 are xerographic copies
only and have been marked as duplicates. Possession of this "Original"
is required to perfect, by possession, a security interest in this
Equipment Schedule as chattel paper under the UCC.
11. Executed as of the date first written above.
LESSOR: BANC OF AMERICA LEASING & CAPITAL, LLC LESSEE: PHC, Inc.
By: ____________________________ By: ____________________
Name: ____________________________ Name: __________________
Title: ____________________________ Title:__________________
- 47 -
ATTACHMENT A TO EQUIPMENT SCHEDULE No. 001
Dated: As of April 1, 2006
Under: MASTER LEASE No. 16378-00900 dated as of April 1, 2006
Between: Banc of America Leasing & Capital, LLC ("Lessor")
located at: 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
1. EQUIPMENT DESCRIPTION AND LOCATION:
Location A: 200 Lake Street, Peabody, MA 01960
Equipment Make, (* = Taxable)
Item No. Quantity Part No. Model and Description Total $ Cost____
________________________________________________________________________________
Vendor: To be determined
001-01 1 Hardware $200,000.00
Location Total $200,000.00
Attachment Total $200,000.00
Together with all parts, accessories, attachments, substitutions, repairs,
improvements and replacements, and any and all rights thereunder and
proceeds thereof, including insurance proceeds. The above equipment will be
more fully described in Certificates of Equipment Acceptance signed or to
be signed by Lessee, each of which is incorporated into and made a part of
the Equipment Schedule.
2. Executed as of the date first set forth above.
LESSOR: BANC OF AMERICA LEASING & CAPITAL, LLC LESSEE: PHC, Inc.
By: /s/ P. Wesley Yount, III By: /s/ Paula C. Wurts
Name: P. Wesley Yount, III Name: Paula C. Wurts
Title: Senior Vice President Title: CFO
- 48 -
ATTACHMENT A TO EQUIPMENT SCHEDULE No. 002
Dated: As of April 1, 2006
Under: MASTER LEASE No. 16378-00900 dated as of April 1, 2006
Between: Banc of America Leasing & Capital, LLC ("Lessor")
located at: 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
3. EQUIPMENT DESCRIPTION AND LOCATION:
Location A: 200 Lake Street, Peabody, MA 01960
Equipment Make, (* = Taxable)
Item No. Quantity Part No. Model and Description Total $ Cost____
________________________________________________________________________________
Vendor: Meditech
Vendor: Meditech
001-01 1 Software
License Fee $250,125.00*
Implementation $212,306.00
Location Total $462,431.00
Attachment Total $462,431.00
Together with all parts, accessories, attachments, substitutions,
repairs, improvements and replacements, and any and all rights
thereunder and proceeds thereof, including insurance proceeds. The
above equipment will be more fully described in Certificates of
Equipment Acceptance signed or to be signed by Lessee, each of which
is incorporated into and made a part of the Equipment Schedule.
4. Executed as of the date first set forth above.
LESSOR: BANC OF AMERICA LEASING & CAPITAL, LLC LESSEE: PHC, Inc.
By: ____________________________ By: ____________________
Name: ____________________________ Name: __________________
Title: ____________________________ Title:__________________
- 49 -
ATTACHMENT B TO EQUIPMENT SCHEDULE No. 001
Dated: As of April 1, 2006
Under: MASTER LEASE No. 16378-00900 dated as of April 1, 2006
Between: Banc of America Leasing & Capital, LLC ("Lessor")
located at: 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
1. EQUIPMENT CHANGES: It is anticipated that the Equipment listed in
Attachment A to the Equipment Schedule shall be delivered to and installed
at the locations set forth in said Attachment A over a period of 5 months
beginning on the Commencement date. Changes to this Equipment will be
permitted only as follows:
(a) At any time before an item of Equipment is delivered to and accepted
by Lessee, Lessee may, upon written approval of Lessor, which approval
shall not be unreasonably withheld, substitute said Equipment with
equipment of similar make, design, function and quality and of equal
or lesser cost.
(b) At any time before an item of Equipment is delivered to Lessee, Lessee
may decide to reduce the Equipment listed in said Attachment A by one
or more such items of Equipment.
(c) If Lessee makes changes to the Equipment as allowed in (a) or (b)
above, and, as a result of such changes, there is a reduction in the
total cost of Equipment being leased under this Equipment Schedule
(such reduced amount hereinafter the "Final Total Cost") then, on the
date Lessee notifies Lessor in writing that Lessee has accepted the
last item of Equipment which it intends to accept, Lessor shall, at
Lessor's option, either:
(i) adjust the remaining monthly lease rentals downwards to
appropriately reflect the difference between the Final Total Cost
and the Attachment Total set forth in said Attachment A, while at
the same time maintaining Lessor's profit level; or,
(ii) pay Lessee the difference between the Final Total Cost and the
Attachment Total set forth in said Attachment A in the manner set
for in the "Payments to Vendors" in Attachment C to this
Equipment Schedule, as if Lessee was a Vendor of Equipment.
2. Executed as of the date first written above.
LESSOR: BANC OF AMERICA LEASING & CAPITAL, LLC LESSEE: PHC, Inc.
By: /s/ P. Wesley Yount, III By: /s/ Paula C. Wurts
Name: P. Wesley Yount, III Name: Paula C. Wurts
Title: Senior Vice President Title: CFO
- 50 -
ATTACHMENT B TO EQUIPMENT SCHEDULE No. 002
Dated: As of April 1, 2006
Under: MASTER LEASE No. 16378-00900 dated as of April 1, 2006
Between: Banc of America Leasing & Capital, LLC ("Lessor")
located at: 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
1. EQUIPMENT CHANGES: It is anticipated that the Equipment listed in
Attachment A to the Equipment Schedule shall be delivered to and installed
at the locations set forth in said Attachment A over a period of 21 months
beginning on the Commencement date. Changes to this Equipment will be
permitted only as follows:
(a) At any time before an item of Equipment is delivered to and accepted
by Lessee, Lessee may, upon written approval of Lessor, which approval
shall not be unreasonably withheld, substitute said Equipment with
equipment of similar make, design, function and quality and of equal
or lesser cost.
(b) At any time before an item of Equipment is delivered to Lessee, Lessee
may decide to reduce the Equipment listed in said Attachment A by one
or more such items of Equipment.
(c) If Lessee makes changes to the Equipment as allowed in (a) or (b)
above, and, as a result of such changes, there is a reduction in the
total cost of Equipment being leased under this Equipment Schedule
(such reduced amount hereinafter the "Final Total Cost") then, on the
date Lessee notifies Lessor in writing that Lessee has accepted the
last item of Equipment which it intends to accept, Lessor shall, at
Lessor's option, either:
(i) adjust the remaining monthly lease rentals downwards to
appropriately reflect the difference between the Final Total Cost
and the Attachment Total set forth in said Attachment A, while at
the same time maintaining Lessor's profit level; or,
(ii) pay Lessee the difference between the Final Total Cost and the
Attachment Total set forth in said Attachment A in the manner set
for in the "Payments to Vendors" in Attachment C to this
Equipment Schedule, as if Lessee was a Vendor of Equipment.
2. Executed as of the date first written above.
LESSOR: BANC OF AMERICA LEASING & CAPITAL, LLC LESSEE: PHC, Inc.
By: ____________________________ By: ____________________
Name: ____________________________ Name: __________________
Title: ____________________________ Title:__________________
- 51 -
ATTACHMENT C TO EQUIPMENT SCHEDULE No. 001
Dated: As of April 1, 2006
Under: MASTER LEASE No. 16378-00900 dated as of April 1, 2006
Between: Banc of America Leasing & Capital, LLC ("Lessor")
located at: 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
1. PAYMENT TO VENDORS: It is anticipated that the Equipment listed in
Attachment A to this Equipment Schedule shall be delivered to and installed
at the locations set forth in said Attachment A over a period of 5 months
beginning on the Commencement Date and that Lessor shall, in accordance
with the terms set forth, pay to the vendors of the Equipment ("Vendors")
on the last day of each Payment Month, set forth in the Schedule of
Payments listed below, the corresponding Payment Amount. Notwithstanding
the foregoing:
(a) Lessor shall make no payments to Vendors: (1) if Lessee is in default
of its obligations hereunder; and (2) unless Lessee delivers to Lessor
an executed Certificate of Equipment Acceptance ("CEA") prepared by
Lessor detailing the Equipment which has been accepted by Lessee and
the cost of such Equipment; and,
(b) Lessor shall be allowed 15 days, from the date each CEA is received,
to inspect the Equipment listed therein and thereafter shall pay the
Vendors of such Equipment the cost of the Equipment on the later of
either the last day of the month in which such CEA is received by
Lessor or the 16th day following the date such CEA is received by
Lessor; provided, however, that the total payments made hereunder:
(1) through the last day before the last day of a particular Payment
Month set forth in the Schedule of Payments listed below shall
not exceed either: (i) the Cumulative Payment Amount
corresponding to the preceding Payment Month; or (ii) the
cumulative total of the Certificate of Acceptance Total set forth
in all the CEA's executed by Lessee and delivered to Lessor (the
"Cumulative CEA Cost" though that date;
(2) through the last day of a particular Payment Month set forth in
the Schedule of Payments listed below shall not exceed either:
(i) the Cumulative Payment Amount corresponding to that Payment
Month; or, (ii) the Cumulative CEA Cost through that date;
(3) through the end of the Term hereof shall not exceed the
Attachment Total set forth in Attachment A to this Equipment
Schedule.
(c) While Lessee is in default of any of its obligations under this
Equipment Schedule, Lessor shall not be obligated to prepare, and
Lessee shall not be capable for purposes hereof of executing, any
CEA.
2. SCHEDULE OF PAYMENTS:
Payment Month Payment Amount Cumulative Payment Amount
2006:
April $ 0.00 $ 0.00
May $ 0.00 $ 0.00
June $ 0.00 $ 0.00
July $ 0.00 $ 0.00
August $200,000.00 $200,000.00
3. Executed as of the date first written above.
LESSOR: BANC OF AMERICA LEASING & CAPITAL, LLC LESSEE: PHC, Inc.
By: /s/ P. Wesley Yount, III By: /s/ Paula C. Wurts
Name: P. Wesley Yount, III Name: Paula C. Wurts
Title: Senior Vice President Title: CFO
- 52 -
ATTACHMENT C TO EQUIPMENT SCHEDULE No. 002
Dated: As of April 1, 2006
Under: MASTER LEASE No. 16378-00900 dated as of April 1, 2006
Between: Banc of America Leasing & Capital, LLC ("Lessor")
located at: 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
1. PAYMENT TO VENDORS: It is anticipated that the Equipment listed in
Attachment A to this Equipment Schedule shall be delivered to and installed
at the locations set forth in said Attachment A over a period of 21 months
beginning on the Commencement Date and that Lessor shall, in accordance
with the terms set forth, pay to the vendors of the Equipment ("Vendors")
on the last day of each Payment Month, set forth in the Schedule of
Payments listed below, the corresponding Payment Amount. Notwithstanding
the foregoing:
(a) Lessor shall make no payments to Vendors: (1) if Lessee is in default
of its obligations hereunder; and (2) unless Lessee delivers to Lessor
an executed Certificate of Equipment Acceptance ("CEA") prepared by
Lessor detailing the Equipment which has been accepted by Lessee and
the cost of such Equipment; and,
(b) Lessor shall be allowed 15 days, from the date each CEA is received,
to inspect the Equipment listed therein and thereafter shall pay the
Vendors of such Equipment the cost of the Equipment on the later of
either the last day of the month in which such CEA is received by
Lessor or the 16th day following the date such CEA is received by
Lessor; provided, however, that the total payments made hereunder:
(1) through the last day before the last day of a particular Payment
Month set forth in the Schedule of Payments listed below shall
not exceed either: (i) the Cumulative Payment Amount
corresponding to the preceding Payment Month; or (ii) the
cumulative total of the Certificate of Acceptance Total set forth
in all the CEA's executed by Lessee and delivered to Lessor (the
"Cumulative CEA Cost" though that date;
(2) through the last day of a particular Payment Month set forth in
the Schedule of Payments listed below shall not exceed either:
(i) the Cumulative Payment Amount corresponding to that Payment
Month; or, (ii) the Cumulative CEA Cost through that date;
(3) through the end of the Term hereof shall not exceed the
Attachment Total set forth in Attachment A to this Equipment
Schedule.
(c) While Lessee is in default of any of its obligations under this
Equipment Schedule, Lessor shall not be obligated to prepare, and
Lessee shall not be capable for purposes hereof of executing, any CEA.
2. SCHEDULE OF PAYMENTS:
Payment Month Payment Amount Cumulative Payment Amount
2006:
April $ 0.00 $ 0.00
May $ 0.00 $ 0.00
June $ 0.00 $ 0.00
July $ 0.00 $ 0.00
August $ 0.00 $ 0.00
October $ 46,243.10 $ 46,243.10
November $ 78,000.00 $124,243.10
December $ 13,050.00 $137,293.10
2007:
January $ 18,050.40 $155,343.50
February $ 78,000.00 $233,343.50
March $ 13,050.00 $246,393.50
April $ 18,050.40 $264,443.90
May $ 95,372.00 $359,815.90
June $ 3,262.50 $363,078.40
July $ 4,512.60 $367,591.00
August $ 75,872.00 $443,463.00
November $ 18,968.00 $462,431.00
6. Executed as of the date first written above.
LESSOR: BANC OF AMERICA LEASING & CAPITAL, LLC LESSEE: PHC, Inc.
By: ____________________________ By: ____________________
Name: ____________________________ Name: __________________
Title: ____________________________ Title:__________________
- 53 -
CERTIFICATE OF LEASE ACCEPTANCE
Dated: As of April 1, 2006
Under: MASTER LEASE No. 16378-00900 dated as of April 1, 2006
Between: Banc of America Leasing & Capital, LLC ("Lessor")
located at: 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
1. REPRESENTATIONS BY LESSEE: As of the Lease Acceptance Date set forth below,
Lessee:
(a) acknowledges that all or some of the Equipment listed in Attachment A
to this Equipment Schedule has not yet, and may never be, delivered to
Lessee;
(b) represents and warrants to Lessor that this lease and Lessee's
obligations under this Equipment Schedule, including Lessee's
unconditional obligation to pay Rent for the Term of this Equipment
Schedule, shall commence on the Lease Acceptance Date set forth below,
and shall not be affected in any respect whatsoever by the failure of
the Vendors to deliver the balance of the Equipment; and,
(c) agrees to indemnify, defend and hold Lessor harmless from and against
any and all losses, claims, suits, actions, liabilities, damages,
costs and expenses (including attorney's fees) arising directly or
indirectly out of any claim by the vendor for payments for Equipment
which are precluded by the terms and provisions of this Equipment
Schedule.
2. LEASE ACCEPANCE DATE: April 1, 2006
1. Executed as of the Lease Acceptance Date.
LESSEE: PHC, Inc.
By: /s/ Paula C. Wurts
Name: Paula C. Wurts
Title: CFO
- 54 -
SOFTWARE RIDER
dated: as of April 1, 2006
to : Equipment Schedule No. 1 dated as of April 1, 2006
(the "Equipment Schedule")
under : Master Lease No. 16378-00900 dated as of April 1, 2006
(the "Master Lease")
between: Banc of America Leasing & Capital, LLC ("Lessor")
located at: 2059 Northlake Parkway Suite 400, Tucker, GA 30084
and: PHC, Inc. ("Lessee")
located at: 200 Lake Street, Peabody, MA 01960
1. The term "Equipment" includes any computer program or application or the
license to use such program or application (hereinafter "Software"), that
is referred to in Attachment A or any Certificate of Equipment Acceptance
hereunder or financed from the proceeds of this Lease.
2. Lessee hereby grants Lessor a security interest in such Software as
security for the due and timely compliance by Lessee with all its
obligations under the Lease. If Lessee returns the Equipment pursuant to a
so-called "Return Option" (if any) set forth in the Equipment Schedule, or
if the Equipment Schedule is terminated by Lessor as a result of an Event
of Default or otherwise in terms of the Master Lease, Lessee shall promptly
upon receipt of Lessor's written demand to do so, discontinue any use of
the Software and return all copies in its possession of any item or medium
on which such Software is stored, together with any operating manuals or
other materials supplied therewith, and will delete or destroy any other
copy of such Software which may be stored on or used by any computer or
other electronic device in Lessee's possession or control, and Lessee
shall, in that event, assure Lessor in writing that all Software has been
destroyed and that Lessee is not using the Software after termination.
LESSOR: BANC OF AMERICA LEASING & CAPITAL, LLC LESSEE: PHC, Inc.
By: ____________________________ By: ____________________
Name: ____________________________ Name: __________________
Title: ____________________________ Title:__________________
- 55 -
CERTIFICATE OF INCUMBENCY
RE: Master Lease No. 16378-00900 dated as of April 1, 2006 and all
Equipment Schedules thereto
between Banc of America Leasing & Capital, LLC, as Lessor
located at 2059 Northlake Parkway, Suite 400, Tucker, GA 30084
and PHC, Inc. (the "Company"), as Lessee
located at 200 Lake Street, Peabody, MA 01960
I hereby certify that I am the duly elected, qualified and presently serving
Secretary or Assistant Secretary of the Company. I further certify that as of
and since the date first set forth above: (a) each of the persons listed below
was duly elected to, and holds the corporate office set forth opposite his or
her name; (b) the signature appearing opposite the name of such officer is the
genuine signature of such officer; and (c) such person has the power and
authority to execute any and all documents on behalf of the Company relating to
the above referenced transaction and to bind the Company to perform in
accordance with the terms thereof.
NAME OF OFFICER OFFICE SIGNATURE OF OFFICER
__________________________ ____________________ __________________________
__________________________ ____________________ __________________________
__________________________ ____________________ __________________________
IN WITNESS WHEREOF, I have hereto set my hand as Secretary or Assistant
Secretary of the Company this _____day of _____, 20___.
Affix corporate seal Secretary or Assistant Secretary ________________
If the Secretary or Assistant Secretary is a signatory on any of the documents
referred to above, another officer of the Company must countersign below.
Officer's Countersignature: _______________________
Title: ___________________
- 56 -
MEDICAL INFORMATION TECHNOLOGY, INC.
AMENDMENT entered into this _____ day of _____________, 2006 by and between
MEDICAL INFORMATION TECHNOLOGY, INC. ("MEDITECH") and PHC, Inc. ("Customer")
WHEREAS MEDITECH and Customer entered into a Health Care Information System
Software Agreement dated ___________, 2006 ("the Agreement") whereby MEDITECH
licensed computer programs ("LICENSED SOFTWARE") for use by Customer, and
WHEREAS Customer and MEDITECH desire to amend the Agreement,
NOW THEREFORE, the parties hereto hereby agree as follows:
1. Article I(C) of the Agreement is deleted in its entirety and
substituted in lieu thereof shall be the following:
"RESTRICTIONS ON TRANSFER
The LICENSED SOFTWARE shall at all times remain the property of MEDITECH
and the license of use granted herein to Customer specifically excludes any
right of reproduction, sale, lease, sublicense, or other transfer or
disposition of the LICENSED SOFTWARE by Customer except as otherwise
expressly stated herein. The rights granted hereunder are granted to
Customer only and are not assignable to any other person, corporation, or
entity except that, subject to the prior written consent of any lessor or
lender which leased or financed the line item fee(s) payable with respect
to the LICENSED SOFTWARE, upon the transfer by sale, merger, corporate
re-organization, or re-organization in bankruptcy of Customer, of
substantially all of the assets of Customer to a successor organization,
including Customer following its discharge from bankruptcy pursuant to a
plan of re-organization, this Agreement and the rights and obligations of
Customer hereunder may be assigned to such successor. Customer agrees to
notify MEDITECH promptly in writing of the transfer to such successor and
the assumption by such successor of Customer's obligations and
responsibilities as described in this Agreement. Customer acknowledges that
it, and not MEDITECH, is solely responsible for obtaining the written
consent described herein of any lessor or lender which leased or financed
the line item fee(s) payable with respect to the LICENSED SOFTWARE.
Customer agrees to indemnify MEDITECH and hold MEDITECH harmless from any
liability which may arise in connection therewith."
2. In all other respects the terms and conditions of the Agreement shall
remain in full force and effect.
IN WITNESS WHEREOF each party has executed this Amendment as a sealed instrument
this _____day of ________, 2006.
CUSTOMER PHC, Inc.
By __________________________
Title __________________________
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MEDITECH Medical Information Technology, Inc.
By _____________________________
Title _____________________________
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Banc of America Leasing & Capital LLC
Healthcare Finance
2059 Northlake Parkway Suite 400
Tucker, GA 3008
April 1, 2006
Lawrence A. Polimeno
Vice Chairman
Medical Information Technology, Inc.
Meditech Circle
Westwood, Massachusetts 02090
Dear Mr. Polimeno,
Re: Banc of America Leasing & Capital, LLC Lease with PHC, Inc. ("Lessee"):
Master Lease No. 16378-00900 and Equipment Schedule No. 1 thereunder
(hereinafter the "Lease")
This letter is to record and confirm the agreement between Banc of America
Leasing & Capital, LLC ("BALC") and Medical Information Technology, Inc.
("Meditech") concerning BALC's rights in relation to the "Licensed Software" as
such term is defined in the Health Care Information System Software Agreement
between Meditech and Lessee dated December 30, 2004 (hereinafter the "SSA").
1. The intention of the parties hereto is that BALC or its assigns, having
entered into the Leases with the Lessee to finance the full license fees and
other amounts payable to Meditech under the SSA for perpetual licenses for the
Licensed Software, and having paid such fees to Meditech, should be and will be
furnished with every opportunity to recover the amounts so financed and paid,
without competition from Meditech. Such opportunity shall include the right to
transfer rights of use in the Licensed Software and certain other rights and
benefits under the SSA to third parties only in the circumstances more fully
described below.
2. If BALC or its assigns become aware that the whole or any portion of Lessee's
business enterprise or assets which uses or involves the use of the Licensed
Software, has been or may be transferred to any third party (hereinafter a
"Successor Party") for any reason, including but not limited to any bankruptcy
proceeding or plan of reorganization in bankruptcy, agreement, or judicial
proceeding, Meditech will upon a written request from BALC or its assigns to do
so, agree, free of any charge payable to Meditech, to issue to the Successor
Party a perpetual license to use such Licensed Software upon terms no less
favorable to the Successor Party than were granted to Lessee under the SSA, or
will consent to the transfer to the Successor Party of the perpetual licenses
granted to Lessee under the SSA and all other rights and benefits under the SSA,
subject, however, to payment by Successor Party to BALC or its assigns, in cash
or upon agreed extended payment terms, of such principal amount as may be agreed
between BALC or its assigns and Successor Party; provided that such principal
amount shall not exceed the net book value of the Lease as reflected in the
books of account of BALC or, if BALC has assigned its rights under the Lease to
a third-party, in the books of such third-party. Extended payment terms may
include the assumption by Successor Party of Lessee's remaining obligations with
respect to the payment of amounts due under the Lease or Leases, or some other
amount agreed to by BALC. Meditech undertakes to cooperate in good faith with
BALC or its assigns to facilitate the granting or transfer of perpetual
licenses, and will refrain from any acts or omissions, direct or indirect, which
might interfere with BALC's or its assign's ability to achieve the purposes of
this letter agreement. The term "Successor Party" shall for the purposes of this
letter agreement include the Lessee in bankruptcy (as debtor in possession or
otherwise), Lessee's trustee or other representative in bankruptcy, and Lessee
upon discharge from bankruptcy.
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3. If BALC elects to exercise its rights under a Lease to demand that Lessee
promptly discontinue its use of the Licensed Software after termination of a
Lease and destroy all tangible and intangible items constituting such Licensed
Software, Meditech shall comply with the provisions of paragraph 5 below as if
the Lessee was a Successor Party.
4. The right to receive the balance of any prepaid support services originally
financed under the Lease, shall, to the extent not yet performed by Meditech,
also be transferred to the Successor Party. If the successor party wishes to
renew or upgrade such software support services, the Successor Party may contact
Meditech directly for such upgrades or renewals.
5. Without limiting the generality of the foregoing, for so long as BALC or its
assigns have not yet recovered the whole of the net book value of the Leases,
Meditech shall not directly or indirectly enter into negotiations or participate
in communications with any party or category of parties which BALC in good faith
believes is an actual or potential Successor Party, and has identified in a
written notice addressed to Meditech, concerning any proposal, arrangement, or
contract, involving the granting of a license, perpetual or otherwise, to a
Successor Party, to use the Licensed Software or any software performing
functions substantially similar to those hitherto performed by the Licensed
Software for the Lessee, except in furtherance of the objectives set forth in
this letter agreement for the benefit of BALC or its assigns. BALC shall inform
Meditech in writing when it has completed recovery of the whole of the net book
value of the Leases.
6. To the extent contemplated by, and subject to the provisions of, this letter
agreement, the licenses granted in terms of the SSA with respect to the Licensed
Software, and the rights and benefits of Lessee thereunder, shall be deemed
transferable, but only to the extent provided for in the SSA.
7. Meditech hereby consents to the Lessee granting to BALC a security interest
in all Lessee's rights in the Licensed Software and the licenses thereto.
Please execute both originals of this letter agreement in the space provided
below, and return one original to us, retaining the other for your records.
Very truly yours,
P. Wesley Yount, III
Principal
Agreed and Confirmed:
Lawrence A. Polimeno
for Medical Information Technology, Inc.
Acknowledged and Confirmed:
for PHC, Inc.
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