Replacement and Substitution. During the applicable Lease Term and provided that no Event of Default exists and Lessee has not elected or is not deemed to have elected an option under Section 10.1, 10.2 or Section 11.1(b) or (c) with respect to the Item of EXECUTION COPY Equipment to be replaced or substituted, Lessee may replace or substitute such Item of Equipment ("Replaced Equipment") with Replacement Equipment subject to Lessee's satisfaction of each of the following conditions: (a) Lessee shall have delivered to Agent and Lessor a written notice (the "Replacement Notice") indicating the date such replacement or substitution is to take place (which date shall be (i) in respect of a voluntary replacement or substitution, not more than 90 days following the date of the Replacement Notice or (ii) in the case of a replacement or substitution on account of a Casualty, not later than the date provided for in the applicable Casualty Notice, which Casualty Notice shall serve as the Replacement Notice with respect to such Casualty, which shall identify the Replacement Equipment, the Purchase Price for the Replacement Equipment, and the Replaced Equipment; (b) Lessee shall have delivered to Agent and Lessor evidence satisfactory to Agent and Lessor (i) of Lessee's compliance with the insurance provisions of Section 6.2 with respect to the Replacement Equipment, (ii) of Lessee's payment in full of the Purchase Price and all Installation Expenses of the Replacement Equipment, and (iii) that the Item of Equipment to serve as the Replacement Equipment satisfies the requirements set forth in the definition of "Replacement Equipment"; (c) Lessee shall cause a ▇▇▇▇ of Sale and an amendment to the relevant Lease Supplement and UCC financing statements as detailed on Schedule 6.1(f) of the Participation Agreement to be executed and delivered to Lessor in order to subject such Replacement Equipment to this Lease; and (d) Such Replacement Equipment shall be the same make, model and year of manufacture as the Replaced Equipment or Lessee shall have delivered to Agent and Lessor an Appraisal of the Replacement Equipment showing both (i) the then-current Fair Market Value thereof, and (ii) the Fair Market Value thereof as of the then-current Expiration Date with respect to the Replaced Equipment and on each date on which a Renewal Term with respect thereto would expire, in each case greater than or equal to such values at such dates for the Replaced Equipment. Upon the satisfaction by Lessee of the foregoing conditions, Lessor shall, subject to the rights of any insurer insuring Replaced Equipment suffering a casualty, if applicable, execute and deliver to Lessee, or to its assigns or a nominee, a quitclaim ▇▇▇▇ of sale (without representations or warranties, except that the Replaced Equipment is free and clear of all Lessor Liens) for the Replaced Equipment and such other documents as may be required to release the Replaced Equipment from the terms of this Lease and the Security Documents, in such form as may reasonably be requested by Lessee.
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Sources: Master Lease (Sandisk Corp)
Replacement and Substitution. During (a) In the applicable Lease Term event that any Part which may from time to time be incorporated or installed in or attached to any item of Equipment, or any item of Equipment itself, becomes at any time worn out, lost, stolen, destroyed, seized, confiscated, damaged beyond repair or permanently rendered unfit for use for any reason whatsoever (unless such event constitutes a Casualty or Partial Casualty, in which event the provisions of Section 6.1. or 6.2 hereof shall apply), Lessee, at its own cost and provided that no Event of Default exists and Lessee has not elected expense, will promptly replace, or is not deemed to have elected an option under Section 10.1, 10.2 or Section 11.1(b) or (c) with respect to the Item of EXECUTION COPY Equipment cause to be replaced replaced, such Part or substituted, Lessee may replace or substitute such Item item of Equipment (the "Replaced EquipmentSubstituted Item") with a replacement Part or item of Equipment (a "Replacement Equipment subject to Lessee's satisfaction Part"). In addition, Lessee may, at its own cost and expense, remove in the ordinary course of each maintenance, service, repair, overhaul or testing, any Part, whether or not worn out, destroyed, seized, confiscated, damaged beyond repair or permanently rendered unfit for use, provided that Lessee will, at its own cost and expense, replace such Part as promptly as is commercially reasonable. All Replacement Parts shall be free and clear of the following conditions:
all Liens (aother than Permitted Liens) Lessee and shall be in as good an operating condition as, and shall have delivered a value and utility at least equal to, the Parts replaced, assuming such replaced Parts and the Equipment were immediately prior to Agent and Lessor a written notice (the "Replacement Notice") indicating the date such replacement or substitution is the event or events necessitating such replacement in the condition and repair required to take place (which date be maintained by the terms hereof. Any Part at any time removed from any item of Equipment shall remain subject to the interests of the Agent and the Lessors under the Operative Agreements, no matter where located, until such time as such Part shall be replaced by a Part which has been incorporated or installed in or attached to such item of Equipment and which meets the requirements for a Replacement Part specified above. Immediately upon any Replacement Part becoming incorporated or installed in or attached to any such item of Equipment as above provided, without further act (i) title to the replaced Part shall thereupon vest in respect Lessee, free and clear of a voluntary replacement or substitution, not more than 90 days following the date all rights of the Replacement Notice or (ii) in the case of a replacement or substitution on account of a Casualty, not later than the date provided for in the applicable Casualty Notice, which Casualty Notice shall serve as the Replacement Notice with respect to such Casualty, which shall identify the Replacement Equipment, the Purchase Price for the Replacement EquipmentLessors, and the Replaced Equipment;
(b) Lessee shall have delivered to Agent and Lessor evidence satisfactory to Agent and Lessor (i) of Lessee's compliance with the insurance provisions of Section 6.2 with respect to the Replacement Equipmentno longer be deemed a Part hereunder, (ii) of Lessee's payment title to such Replacement Part shall thereupon vest in full of the Purchase Price and all Installation Expenses of the Replacement Equipment, Lessors and (iii) that such Replacement Part shall become subject to this Lease and the Item security interest created hereunder and be deemed part of such item of Equipment for all purposes hereof to serve the same extent as the Replacement Parts incorporated or installed in or attached to such item of Equipment satisfies on the requirements set forth in date such item of Equipment became subject to this Lease. No later than 45 days after the definition end of "Replacement Equipment";
(c) each fiscal quarter of Lessee, Lessee shall cause deliver to Lessors a ▇▇▇▇ of Sale evidencing the conveyance by Lessee to the Lessors of all Replacement Parts not previously evidenced by
(b) In addition to the foregoing, Lessee shall have the option at any time to replace any Functional Unit (a "Replaced Unit") with a substitute Functional Unit (a "Replacement Unit"), subject to the following conditions:
(i) any such Replacement Unit shall satisfy one of the following conditions: (x) the Replacement Unit shall consist of items of new equipment of identical manufacture and model as the equipment comprising the Replaced Unit, or (y) such Replacement Unit shall have a utility, an Appraised Value, and an amendment economic useful life at least equal to those of the Replaced Unit immediately prior to such substitution, assuming that the Replaced Unit was in the condition and repair required to be maintained by the terms of this Lease, and Lessee shall have provided to the relevant Lease Supplement Agent and UCC financing statements as detailed on Schedule 6.1(feach Lessor, at Lessee's expense, an Appraisal satisfactory to Agent and each Lessor in their sole and absolute discretion with respect to the determination of such utility, Fair Market Value and economic useful life or (z) such Replacement Unit shall otherwise be acceptable to each of the Lessors in its respective sole and absolute discretion;
(ii) Lessee shall have satisfied each of the conditions set forth in Section 4.3 of the Participation Agreement (other than subsection (b) thereof) with respect to be executed and delivered to Lessor in order to subject such Replacement Equipment to this Leasethe proposed replacement; and
(diii) Such Replacement Equipment Lessee shall be the same make, model and year of manufacture as not remove the Replaced Equipment Unit from the location set forth on Schedule I to the Delivery Date Notice pursuant to which the Replaced Unit was delivered until such time as it has executed all documents reasonably requested by Agent or Lessee shall have delivered any Lessor to Agent and Lessor an Appraisal perfect the security interest of the Replacement Equipment showing both (i) Agent, for the then-current Fair Market Value thereof, and (ii) the Fair Market Value thereof as benefit of the then-current Expiration Date with respect to the Replaced Equipment and on each date on which a Renewal Term with respect thereto would expireLessors, in each case greater than or equal to such values at such dates for the Replaced Equipment. Upon the satisfaction by Lessee of the foregoing conditions, Lessor shall, subject to the rights of any insurer insuring Replaced Equipment suffering a casualty, if applicable, execute and deliver to Lessee, or to its assigns or a nominee, a quitclaim ▇▇▇▇ of sale (without representations or warranties, except that the Replaced Equipment is free and clear of all Lessor Liens) for the Replaced Equipment and such other documents as may be required to release the Replaced Equipment from the terms of this Lease and the Security Documents, in such form as may reasonably be requested by LesseeReplacement Unit.
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