EXHIBIT 10.9
MASTER LEASE AGREEMENT
MASTER LEASE AGREEMENT (the "Master Lease") dated September 22, 1998 by and
between COMDISCO, INC. ("Lessor") and CHORUM TECHNOLOGIES, INC. ("Lessee").
IN CONSIDERATION of the mutual agreements described below, the parties agree as
follows (all capitalized terms are defined in Section 14.18):
1. Property Leased.
Lessor leases to Lessee all of the Equipment described on each Summary Equipment
Schedule. In the event of a conflict, the terms of the applicable Schedule
prevail over this Master Lease.
2. Term.
On the Commencement Date, Lessee will be deemed to accept the Equipment, will be
bound to its rental obligations for each item of Equipment and the term of a
Summary Equipment Schedule will begin and continue through the Initial Term and
thereafter until terminated by either party upon prior written notice received
during the Notice Period. No termination may be effective prior to the
expiration of the Initial Term.
3. Rent and Payment.
Rent is due and payable in advance on the first day of each Rent Interval at the
address specified in Lessor's invoice. Interim Rent is due and payable when
invoiced. If any payment is not made when due, Lessee will pay a Late Charge on
the overdue amount. Upon Lessee's execution of each Schedule, Lessee will pay
Lessor the Advance specified on the Schedule. The Advance will be credited
towards the final Rent payment if Lessee is not then in default. No interest
will be paid on the Advance.
4. Selection; Warranty and Disclaimer of Warranties.
4.1 Selection. Lessee acknowledges that it has selected the Equipment and
disclaims any reliance upon statements made by the Lessor, other than as set
forth in the Schedule.
4.2 Warranty and Disclaimer of Warranties. Lessor warrants to Lessee that, so
long as Lessee is not in default, Lessor will not disturb Lessee's quiet and
peaceful possession, and unrestricted use of the Equipment. To the extent
permitted by the manufacturer, Lessor assigns to Lessee during the term of the
Summary Equipment Schedule any manufacturer's warranties for the Equipment.
LESSOR MAKES NO OTHER WARRANTY, EXPRESS OR IMPLIED AS TO ANY MATTER WHATSOEVER,
INCLUDING, WITHOUT LIMITATION, THE MERCHANTABILITY OF THE EQUIPMENT OR ITS
FITNESS FOR A PARTICULAR PURPOSE. Lessor is not responsible for any liability,
claim, loss, damage or expense of any kind (including strict liability in tort)
caused by the Equipment except for any loss or damage caused by the willful
misconduct or negligent acts of Lessor. In no event is Lessor responsible for
special, incidental or consequential damages.
5. Title; Relocation or Sublease; and Assignment.
5.1 Title. Lessee holds the Equipment subject and subordinate to the rights of
the Owner, Lessor, any Assignee and any Secured Party. Lessee authorizes Lessor,
as Lessee's agent, and at Lessor's expense, to prepare, execute and file in
Lessee's name precautionary Uniform Commercial Code financing statements showing
the interest of the Owner, Lessor, and any Assignee or Secured Party in the
Equipment and to insert serial numbers in Summary Equipment Schedules as
appropriate. Lessee will, at its expense, keep the Equipment free and clear from
any liens or encumbrances of any kind (except any caused by Lessor) and will
indemnify and hold the Owner, Lessor, any Assignee and Secured Party harmless
from and against any loss caused by Lessee's failure to do so, except where such
is caused by Lessor.
5.2 Relocation or Sublease. Upon prior written notice, Lessee may relocate
Equipment to any location within the continental United States provided (i) the
Equipment will not be used by an entity exempt from federal income tax, and (ii)
all additional costs (including any administrative fees, additional taxes and
insurance coverage) are reconciled and promptly paid by Lessee.
Lessee may sublease the Equipment upon the reasonable consent of the Lessor and
the Secured Party. Such consent to sublease will be granted if: (i) Lessee meets
the relocation requirements set out above. (ii) the sublease is expressly
subject and subordinate to the terms of the Schedule, (iii) Lessee assigns its
rights in the sublease to Lessor and the Secured Party as additional collateral
and security, (iv) Lessee's obligation to maintain and insure the Equipment is
not altered, (v) all financing statements required to continue the Secured
Party's prior perfected security interest are filed, and (vi) Lessee executes
sublease documents acceptable to Lessor.
No relocation or sublease will relieve Lessee from any of its obligations under
this Master Lease and the relevant Schedule.
5.3 Assignment by Lessor. The terms and conditions of each Schedule have been
fixed by Lessor in order to permit Lessor to sell and/or assign or transfer its
interest or grant a security interest in each Schedule and/or the Equipment to a
Secured Party or Assignee. In that event, the term Lessor will mean the Assignee
and any Secured Party. However, any assignment, sale, or other transfer by
Lessor will not relieve Lessor of its obligations to Lessee and will not
materially change Lessee's duties or materially increase the burdens or risks
imposed on Lessee. The Lessee consents to and will acknowledge such assignments
in a written notice given to Lessee. Lessee also agrees that:
(a) The Secured Party will be entitled to exercise all of Lessor's rights,
but will not be obligated to perform any of the obligations of Lessor. The
Secured Party will not disturb Lessee's quiet and peaceful possession and
unrestricted use of the Equipment so long as Lessee is not in default and the
Secured Party continues to receive all Rent payable under the Schedule; and
(b) Lessee will pay all Rent and all other amounts payable to the Secured
Party, despite any defense or claim which it has against Lessor. Lessee reserves
its right to have recourse directly against Lessor for any defense or claim;
(c) Subject to and without impairment of Lessee's leasehold rights in the
Equipment, Lessee holds the Equipment for the Secured Party to the extent of the
Secured Party's rights in that Equipment.
6. Net Lease; Taxes and Fees.
6.1 Net Lease. Each Summary Equipment Schedule constitutes a net lease. Lessee's
obligation to pay Rent and all other amounts due hereunder is absolute and
unconditional and is not subject to any abatement, reduction, set-off, defense,
counterclaim, interruption, deferment or recoupment for any reason whatsoever.
6.2 Taxes and Fees. Lessee will pay when due or reimburse Lessor for all taxes,
fees or any other charges (together with any related interest or penalties not
arising from the negligence of Lessor) accrued for or arising during the term of
each Summary Equipment Schedule against Lessor, Lessee or the Equipment by any
governmental authority (except only Federal, state, local and franchise taxes on
the capital or the net income of Lessor). Lessor will file all personal property
tax returns for the Equipment and pay all such property taxes due. Lessee will
reimburse Lessor for property taxes within thirty (30) days of receipt of an
invoice.
7. Care, Use and Maintenance; Inspection by Lessor.
7.1 Care, Use and Maintenance. Lessee will maintain the Equipment in good
operating order and appearance, protect the Equipment from deterioration, other
than normal wear and tear, and will not use the Equipment for any purpose other
than that for which it was designed. If commercially available and considered
common business practice for each item of Equipment, Lessee will maintain in
force a standard maintenance contract with the manufacturer of the Equipment, or
another party acceptable to Lessor, and will provide Lessor with a complete copy
of that contract. If Lessee has the Equipment maintained by a party other than
the manufacturer or self maintains, Lessee agrees to pay any costs necessary for
the manufacturer to bring the Equipment to then current release, revision and
engineering change levels, and to re-certify the Equipment as eligible for
manufacturer's maintenance at the expiration of the lease term, provided re-
certification is available and is required by Lessor. The lease term will
continue upon the same terms and conditions until recertification has been
obtained.
7.2 Inspection by Lessor. Upon reasonable advance notice, Lessee, during
reasonable business hours and subject to Lessee's security requirements, will
make the Equipment and its related log and maintenance records available to
Lessor for inspection.
8. Representations and Warranties of Lessee. Lessee hereby represents, warrants
and covenants that with respect to the Master Lease and each Schedule executed
hereunder:
(a) The Lessee is a corporation duly organized and validly existing in good
standing under the taws of the jurisdiction of its incorporation, is duly
qualified to do business in each jurisdiction (including the jurisdiction where
the Equipment is, or is to be, located) where its ownership or lease of property
or the conduct of its business requires such qualification, except for where
such lack of qualification would not have a material adverse effect on the
Company's business; and has full corporate power and authority to hold property
under the Master Lease and each Schedule and to enter into and perform its
obligations under the Master Lease and each Schedule.
(b) The execution and delivery by the Lessee of the Master Lease and each
Schedule and its performance thereunder have been duly authorized by all
necessary corporate action on the part of the Lessee, and the Master Lease and
each Schedule are not inconsistent with the Lessee's Articles of Incorporation
or Bylaws, do not
contravene any law or governmental rule, regulation or order applicable to it,
do not and will not contravene any provision of, or constitute a default under,
any indenture, mortgage, contract or other instrument to which it is a party or
by which it is bound, and the Master Lease and each Schedule constitute legal,
valid and binding agreements of the Lessee, enforceable in accordance with their
terms, subject to the effect of applicable bankruptcy and other similar laws
affecting the rights of creditors generally and rules of law concerning
equitable remedies.
(c) There are no actions, suits, proceedings or patent claims pending or, to
the knowledge of the Lessee, threatened against or affecting the Lessee in any
court or before any governmental commission, board or authority which, if
adversely determined, will have a material adverse effect on the ability of the
Lessee to perform its obligations under the Master Lease and each Schedule.
(d) The Equipment is personal property and when subjected to use by the
Lessee will not be or become fixtures under applicable law.
(e) The Lessee has no material liabilities or obligations, absolute or
contingent (individually or in the aggregate), except the liabilities and
obligations of the Lessee as set forth in the Financial Statements and
liabilities and obligations which have occurred in the ordinary course of
business, and which have not been, in any case or in the aggregate, materially
adverse to Lessee's ongoing business.
(f) To the best of the Lessee's knowledge, the Lessee owns, possesses, has
access to, or can become licensed on reasonable terms under all patents, patent
applications, trademarks, trade names, inventions, franchises, licenses,
permits, computer software and copyrights necessary for the operations of its
business as now conducted, with no known infringement of, or conflict with, the
rights of others.
(g) All material contracts, agreements and instruments to which the Lessee
is a party are in full force and effect in all material respects, and are valid,
binding and enforceable by the Lessee in accordance with their respective terms,
subject to the effect of applicable bankruptcy and other similar laws affecting
the rights of creditors generally, and rules of law concerning equitable
remedies.
9. Delivery and Return of Equipment.
Lessee hereby assumes the full expense of transportation and in-transit
insurance to Lessee's premises and installation thereat of the Equipment. Upon
termination (by expiration or otherwise) of each Summary Equipment Schedule,
Lessee shall, pursuant to Lessor's instructions and at Lessee's full expense
(including, without limitation, expenses of transportation and in-transit
insurance), return the Equipment to Lessor in the same operating order, repair,
condition and appearance as when received, less normal depreciation and wear and
tear. Lessee shall return the Equipment to Lessor at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or at such other address within the continental United
States as directed by Lessor, provided, however, that Lessee's expense shall be
limited to the cost of returning the Equipment to Lessor's address as set forth
herein. During the period subsequent to receipt of a notice under Section 2,
Lessor may demonstrate the Equipment's operation in place and Lessee will supply
any of its personnel as may reasonably be required to assist in the
demonstrations.
10. Labeling.
Upon request, Lessee will ▇▇▇▇ the Equipment indicating Lessor's interest with
labels provided by Lessor. Lessee will keep all Equipment free from any other
marking or labeling which might be interpreted as a claim of ownership.
11. Indemnity.
With regard to bodily injury and property damage liability only, Lessee will
indemnify and hold Lessor, any Assignee and any Secured Party harmless from and
against any and all claims, costs, expenses, damages and liabilities, including
reasonable attorneys' fees, arising out of the ownership (for strict liability
in tort only), selection, possession, leasing, operation, control, use,
maintenance, delivery, return or other disposition of the Equipment during the
term of this Master Lease or until Lessee's obligations under the Master Lease
terminate. However, Lessee is not responsible to a party indemnified hereunder
for any claims, costs, expenses, damages and liabilities occasioned by the
negligent acts of such indemnified party. Lessee agrees to carry bodily injury
and property damage liability insurance during the term of the Master Lease in
amounts and against risks customarily insured against by the Lessee on equipment
owned by it. Any amounts received by Lessor under that insurance will be
credited against Lessee's obligations under this Section.
12. Risk of Loss.
Effective upon delivery and until the Equipment is returned, Lessee relieves
Lessor of responsibility for all risks of physical damage to or loss or
destruction of the Equipment. Lessee will carry casualty insurance for each item
of Equipment in an amount not less than the Casualty Value. All policies for
such insurance will name the Lessor and any Secured Party as additional insured
and as loss payee, and will provide for at least thirty (30) days prior written
notice to the Lessor of cancellation or expiration, and will insure Lessor's
interests regardless of any breach or violation by Lessee of any representation,
warranty or condition contained in such policies and will be primary without
right of contribution from any insurance effected by Lessor. Upon the execution
of any Schedule, the Lessee will furnish appropriate evidence of such insurance
acceptable to Lessor.
Lessee will promptly repair any damaged item of Equipment unless such Equipment
has suffered a Casualty Loss. Within fifteen (15) days of a Casualty Loss,
Lessee will provide written notice of that loss to Lessor and Lessee will, at
Lessee's option, either (a) replace the item of Equipment with Like Equipment
and marketable title to the Like Equipment will automatically vest in Lessor or
(b) pay the Casualty Value and after that payment and the payment of all other
amounts due and owing with respect to that item of Equipment, Lessee's
obligation to pay further Rent for the item of Equipment will cease.
13. Default, Remedies and Mitigation.
13.1 Default. The occurrence of any one or more of the following Events of
Default constitutes a default under a Summary Equipment Schedule:
(a) Lessee's failure to pay Rent or other amounts payable by Lessee when due
if that failure continues for five (5) business days after written notice; or
(b) Lessee's failure to perform any other term or condition of the Schedule
or the material inaccuracy of any representation or warranty made by the Lessee
in the Schedule or in any document or certificate furnished to the Lessor
hereunder if that failure or inaccuracy continues for ten (10) business days
after written notice; or
(c) An assignment by Lessee for the benefit of its creditors, the failure by
Lessee to pay its debts when due, the insolvency of Lessee, the filing by Lessee
or the filing against Lessee of any petition under any bankruptcy or insolvency
law or for the appointment of a trustee or other officer with similar powers,
the adjudication of Lessee as insolvent, the liquidation of Lessee, or the
taking of any action for the purpose of the foregoing; or
(d) The occurrence of an Event of Default under any Schedule, Summary
Equipment Schedule or other agreement between Lessee and Lessor or its Assignee
or Secured Party.
13.2 Remedies. Upon the occurrence of any of the above Events of Default,
Lessor, at its option, may:
(a) enforce Lessee's performance of the provisions of the applicable
Schedule by appropriate court action in law or in equity;
(b) recover from Lessee any damages and or expenses, including Default
Costs;
(c) with notice and demand, recover all sums due and accelerate and recover
the present value of the remaining payment stream of all Rent due under the
defaulted Schedule (discounted at the same rate of interest at which such
defaulted Schedule was discounted with a Secured Party plus any prepayment fees
charged to Lessor by the Secured Party or, if there is no Secured Party, then
discounted at 6%) together with all Rent and other amounts currently due as
liquidated damages and not as a penalty;
(d) with notice and process of law and in compliance with Lessee's security
requirements, Lessor may enter on Lessee's premises to remove and repossess the
Equipment without being liable to Lessee for damages due to the repossession,
except those resulting from Lessor's, its assignees', agents' or
representatives' negligence; and
(e) pursue any other remedy permitted by law or equity.
The above remedies, in Lessor's discretion and to the extent permitted by law,
are cumulative and may be exercised successively or concurrently.
13.3 Mitigation. Upon return of the Equipment pursuant to the terms of Section
13.2, Lessor will use its best efforts in accordance with its normal business
procedures (and without obligation to give any priority to such Equipment) to
mitigate Lessor's damages as described below. EXCEPT AS SET FORTH IN THIS
SECTION, LESSEE HEREBY WAIVES ANY RIGHTS NOW OR HEREAFTER CONFERRED BY STATUTE
OR OTHERWISE WHICH MAY REQUIRE LESSOR TO MITIGATE ITS DAMAGES OR MODIFY ANY OF
LESSOR'S RIGHTS OR REMEDIES STATED HEREIN. Lessor may sell, lease or otherwise
dispose of all or any part of the Equipment at a public or private sale for cash
or credit with the privilege of purchasing the Equipment. The proceeds from any
sale, lease or other disposition of the Equipment are defined as either:
(a) if sold or otherwise disposed of, the cash proceeds less the Fair Market
Value of the Equipment at the expiration of the Initial Term less the Default
Costs; or
(b) if leased, the present value (discounted at three percent (3%) over the
U.S. Treasury Notes of comparable maturity to the term of the re-lease) of the
rentals for a term not to exceed the Initial Term, less the Default Costs.
Any proceeds will be applied against liquidated damages and any other sums due
to Lessor from Lessee. However, Lessee is liable to Lessor for, and Lessor may
recover, the amount by which the proceeds are less than the liquidated damages
and other sums due to Lessor from Lessee.
14. Additional Provisions.
14.1 Board Attendance. Upon invitation of Lessee, one representative of Lessor
will have the right to attend Lessee's corporate Board of Directors meetings and
Lessee will give Lessor reasonable notice in advance of any special Board of
Directors meeting, which notice will provide an agenda of the subject matter to
be discussed at such board meeting. Lessee will provide Lessor with a certified
copy of the minutes of each Board of Directors meeting within thirty (30) days
following the date of such meeting held during the term of this Master Lease.
14.2 Financial Statements. As soon as practicable at the end of each month (and
in any event within thirty (30) days), Lessee will provide to Lessor the same
information which Lessee provides to its Board of Directors, but which will
include not less than a monthly income statement, balance sheet and statement of
cash flows prepared in accordance with generally accepted accounting principles,
consistently applied (the "Financial Statements"). As soon as practicable at the
end of each fiscal year, Lessee will provide to Lessor audited Financial
Statements setting forth in comparative form the corresponding figures for the
fiscal year (and in any event within ninety (90) days), and accompanied by an
audit report and opinion of the independent certified public accountants
selected by Lessee. Lessee will promptly furnish to Lessor any additional
information (including, but not limited to, tax returns, income statements,
balance sheets and names of principal creditors) as Lessor reasonably believes
necessary to evaluate Lessee's continuing ability to meet financial obligations.
After the effective date of the initial registration statement covering a public
offering of Lessee's securities, the term "Financial Statements" will be deemed
to refer to only those statements required by the Securities and Exchange
Commission.
14.3 Obligation to Lease Additional Equipment. Upon notice to Lessee, Lessor
will not be obligated to lease any Equipment which would have a Commencement
Date after said notice if: (i) Lessee is in default under this Master Lease or
any Schedule; (ii) Lessee is in default under any loan agreement, the result of
which would allow the lender or any secured party to demand immediate payment of
any material indebtedness; (iii) there is a material adverse change in Lessee's
credit standing; or (iv) Lessor determines (in reasonable good faith) that
Lessee will be unable to perform its obligations under this Master Lease or any
Schedule.
14.4 Merger and Sale Provisions. Lessee will notify Lessor of any proposed
Merger at least sixty (60) days prior to the closing date. Lessor may, in its
discretion, either (i) consent to the assignment of the Master Lease and all
relevant Schedules to the successor entity, or (ii) terminate the Master Lease
and all relevant Schedules. If Lessor elects to consent to the assignment,
Lessee and its successor will sign the assignment documentation provided by
Lessor. If Lessor elects to terminate the Master Lease and all relevant
Schedules, then Lessee will pay Lessor all amounts then due and owing and a
termination fee equal to the present value (discounted at 6%) of the remaining
Rent for the balance of the Initial Term(s) of all Schedules, and will return
the Equipment in accordance with Section 9. Lessor hereby consents to any Merger
in which the acquiring entity has a ▇▇▇▇▇'▇ Bond Rating of BA3 or better or a
commercially acceptable equivalent measure of creditworthiness as reasonably
determined by Lessor.
14.5 Entire Agreement. This Master Lease and associated Schedules and Summary
Equipment Schedules supersede all other oral or written agreements or
understandings between the parties concerning the Equipment including, for
example, purchase orders. ANY AMENDMENT OF THIS MASTER LEASE OR A SCHEDULE, MAY
ONLY BE ACCOMPLISHED BY A WRITING SIGNED BY THE PARTY AGAINST WHOM THE AMENDMENT
IS SOUGHT TO BE ENFORCED.
14.6 No Waiver. No action taken by Lessor or Lessee will be deemed to
constitute a waiver of compliance with any representation, warranty or covenant
contained in this Master Lease or a Schedule. The waiver by Lessor or Lessee of
a breach of any provision of this Master Lease or a Schedule will not operate or
be construed as a waiver of any subsequent breach.
14.7 Binding Nature. Each Schedule is binding upon, and inures to the benefit
of Lessor and its assigns. LESSEE MAY NOT ASSIGN ITS RIGHTS OR OBLIGATIONS.
14.8 Survival of Obligations. All agreements, obligations including, but not
limited to those arising under Section 6.2, representations and warranties
contained in this Master Lease, any Schedule. Summary Equipment Schedule or in
any document delivered in connection with those agreements are for the benefit
of Lessor and any Assignee or Secured Party and survive the execution, delivery,
expiration or termination of this Master Lease.
14.9 Notices. Any notice, request or other communication to either party by the
other will be given in writing and deemed received upon the earlier of (1)
actual receipt or (3) three days after mailing if mailed postage prepaid by
regular or airmail to Lessor (to the attention of "the Comdisco Venture Group")
or Lessee, at the address set out in the Schedule, (3) one day after it is sent
by courier or (4) on the same day as sent via facsimile transmission, provided
that the original is sent by personal delivery or mail by the sending party.
14.10 Applicable Law. THIS MASTER LEASE HAS BEEN, AND EACH SCHEDULE WILL HAVE
BEEN MADE, EXECUTED AND DELIVERED IN THE STATE OF ILLINOIS AND WILL BE GOVERNED
AND CONSTRUED FOR ALL PURPOSES IN ACCORDANCE WITH THE LAWS OF THE STATE OF
ILLINOIS WITHOUT GIVING EFFECT TO CONFLICT OF LAW PROVISIONS. NO RIGHTS OR
REMEDIES REFERRED TO IN ARTICLE 2A OF THE UNIFORM COMMERCIAL CODE WILL BE
CONFERRED ON LESSEE UNLESS EXPRESSLY GRANTED IN THIS MASTER LEASE OR A SCHEDULE.
14.11 Severability. If any one or more of the provisions of this Master Lease or
any Schedule is for any reason held invalid, illegal or unenforceable, the
remaining provisions of this Master Lease and any such Schedule will be
unimpaired, and the invalid, illegal or unenforceable provision replaced by a
mutually acceptable valid, legal and enforceable provision that is closest to
the original intention of the parties.
14.12 Counterparts. This Master Lease and any Schedule may be executed in any
number of counterparts, each of which will be deemed an original, but all such
counterparts together constitute one and the same instrument. If Lessor grants a
security interest in all or any part of a Schedule, the Equipment or sums
payable thereunder, only that counterpart Schedule marked "Secured Party's
Original" can transfer Lessor's rights and all other counterparts will be marked
"Duplicate."
14.13 Licensed Products. Lessee will obtain no title to Licensed Products which
will at all times remain the property of the owner of the Licensed Products. A
license from the owner may be required and it is Lessee's responsibility to
obtain any required license before the use of the Licensed Products. Lessee
agrees to treat the Licensed Products as confidential information of the owner,
to observe all copyright restrictions, and not to reproduce or sell the Licensed
Products.
14.14 Secretary's Certificate. Lessee will, upon execution of this Master Lease,
provide Lessor with a secretary's certificate of incumbency and authority. Upon
the execution of each Schedule with a purchase price in excess of $1,000,000,
Lessee will provide Lessor with an opinion from Lessee's counsel in a form
acceptable to Lessor regarding the representations and warranties in Section 8.
14.15 Electronic Communications. Each of the parties may communicate with the
other by electronic means under mutually agreeable terms.
14.16 Landlord/Mortgagee Waiver. Lessee agrees to provide Lessor with a
Landlord/Mortgagee Waiver with respect to the Equipment. Such waiver shall be in
a form satisfactory to Lessor.
14.17 Equipment Procurement Charges/Progress Payments. Lessee hereby agrees that
Lessor shall not, by virtue of its entering into this Master Lease, be required
to remit any payments to any manufacturer or other third party until Lessee
accepts the Equipment subject to this Master Lease.
14.18 Definitions.
Advance - means the amount due to Lessor by Lessee upon Lessee's execution of
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each Schedule.
Assignee - means an entity to whom Lessor has sold or assigned its rights as
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owner and Lessor of Equipment.
Casualty Loss - means the irreparable loss or destruction of Equipment.
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Casualty Value - means the greater of the aggregate Rent remaining to be paid
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for the balance of the lease term or the Fair Market Value of the Equipment
immediately prior to the Casualty Loss. However, if a Casualty Value Table is
attached to the relevant Schedule its terms will control.
Commencement Date - is defined in each Schedule.
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Default Costs - means reasonable attorney's fees and remarketing costs resulting
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from a Lessee default or Lessor's enforcement of its remedies.
Delivery Date - means date of delivery of Inventory Equipment to Lessee's
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address.
Equipment - means the property described on a Summary Equipment Schedule and any
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replacement for that property required or permitted by this Master Lease or a
Schedule.
Event of Default - means the events described in Subsection 13.1.
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Fair Market Value - means the aggregate amount which would be obtainable in an
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arm's-length transaction between an informed and willing buyer/user and an
informed and willing seller under no compulsion to sell.
Initial Term - means the period of time beginning on the first day of the first
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full Rent Interval following the Commencement Date for all items of Equipment
and continuing for the number of Rent Intervals indicated on a Schedule.
Interim Rent - means the pro-rata portion of Rent due for the period from the
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Commencement Date through but not including the first day of the first full Rent
Interval included in the Initial Term.
Late Charge - means the lesser of five percent (5%) of the payment due or the
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maximum amount permitted by the law of the state where the Equipment is located.
Licensed Products - means any software or other licensed products attached to
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the Equipment.
Like Equipment - means replacement Equipment which is lien free and of the same
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model, type, configuration and manufacture as Equipment.
Merger - means any consolidation or merger of the Lessee with or into any other
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corporation or entity, any sale or conveyance of all or substantially all of the
assets or stock of the Lessee by or to any other person or entity in which
Lessee is not the surviving entity.
Notice Period - means not less than ninety (90) days nor more than twelve (12)
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months prior to the expiration of the lease term.
Owner - means the owner of Equipment.
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Rent - means the rent Lessee will pay for each item of Equipment expressed in a
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Summary Equipment Schedule either as a specific amount or an amount equal to the
amount which Lessor pays for an item of Equipment multiplied by a lease rate
factor plus all other amounts due to Lessor under this Master Lease or a
Schedule.
Rent Interval - means a full calendar month or quarter as indicated on a
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Schedule.
Schedule - means either an Equipment Schedule or a Licensed Products Schedule
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which incorporates all of the terms and conditions of this Master Lease.
Secured Party - means an entity to whom Lessor has granted a security interest
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for the purpose of securing a loan.
Summary Equipment Schedule - means a certificate provided by Lessor summarizing
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all of the Equipment for which Lessor has received Lessee approved vendor
invoices, purchase documents and/or evidence of delivery during a calendar
quarter which will incorporate all of the terms and conditions of the related
Schedule and this Master Lease and will constitute a separate lease for the
equipment leased thereunder.
IN WITNESS WHEREOF, the parties hereto have executed this Master Lease on or as
of the day and year first above written.
CHORUM TECHNOLOGIES, INC. COMDISCO, INC.,
as Lesee as Lessor
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
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Title: President and CEO Title: President
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ADDENDUM TO THE
MASTER LEASE AGREEMENT DATED AS OF SEPTEMBER 22, 1998
BETWEEN CHORUM TECHNOLOGIES, INC., AS LESSEE
AND COMDISCO, INC., AS LESSOR
The undersigned hereby agree that the terms and conditions of the above
referenced Master Lease Agreement are hereby modified and amended as follows:
1) Section 3. "Rent and Payment."
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Insert the following at the end of the second sentence after the word
"amount",
"provided, however, that so long as payment is made within five (5) days
after the date such payment is due, no late charge will be assessed for up
to two (2) late payments under a particular Summary Equipment Schedule."
Delete the second sentence and the last 3 sentences of this section.
2) Section 4.2 "Warranty and Disclaimer of Warranties."
--------------------------------------
In line 2, delete "Lessee is not in default" and replace with "No Event of
Default exists".
3) Section 5.2 "Relocation or Sublease."
------------------------
Second paragraph, first sentence, lines 1 and 2, delete the words "and the
Secured Party".
4) Section 5.3 "Assignment by Lessor."
-----------------------
Paragraph (a), second sentence, lines 3 and 4, delete "Lessee is not in
default and the Secured Party continues to receive all Rent payable under
the Schedule" and insert "no Event of Default has occurred and is
continuing".
5) Section 6.2 "Taxes and Fees."
----------------
First sentence, lines 5 and 6, delete "only Federal, state, local and
franchise taxes on the capital or the net income of Lessor" and insert the
following:
"Excluded Taxes. Excluded Taxes means (a) taxes based upon, measured by or
with respect to the net or gross income, items of tax preference or minimum
tax or excess profits, receipts, capital, franchise, net worth or
similarly-based taxes, (b) taxes on items of tax preference or any minimum
tax or alternative minimum tax, (c) taxes imposed with respect to any
period after either (i) Lessee's payment of the Casualty Value hereunder,
provided, however such amounts shall be limited to taxes for those items
for which a Casualty Value was
paid and, or (ii) the expiration or earlier termination of the Initial Term
or the extended term, as applicable, and either (A) the return of the
Equipment pursuant to the Lease or (B) the transfer of Lessor's interest in
the Equipment pursuant to any purchase or termination option, (d) taxes
resulting from the misconduct, negligence or breach by Lessor, (e) taxes
which become payable by reason of any transfer by Lessor of its interest in
the Equipment or the Summary Equipment Schedule, other than in connection
with its exercise of any remedies hereunder, (f) taxes subject to any other
indemnification hereunder, (g) taxes imposed on a successor, assignor, or
other transferee of Lessor to the extent that such taxes would not have
been imposed on the original Lessor or exceed the amount of taxes that
would have been imposed and would have been indemnifiable pursuant to this
indemnity had there not been a succession, assignment or other transfer by
such original Lessor, (h) taxes imposed by any jurisdiction that would not
have been imposed on Lessor but for its activities or status in such
jurisdiction unrelated to the transactions contemplated hereby and (i) any
taxes included in the purchase price of the Equipment leased hereunder."
6) Section 7.1 "Care. Use and Maintenance."
--------------------------
Second sentence, line 4, after the words "and will provide Lessor" insert
"upon request".
Delete the last two sentences of this section.
7) Section 8. "Representations and Warranties."
-------------------------------
In paragraph (b), line 7, after "which is bound" insert ", which default
could have a material effect on Lessee".
In paragraph (d), line 1, after "Equipment" insert "(excluding any software
and/or tenant improvements financed hereunder)".
In paragraph (e), line 3, after "in the Financial Statements" insert "most
recently delivered hereunder".
Paragraph (f), at the end thereof insert "such that such infringement could
have a material adverse effect on the Lessee's business operations.".
Paragraph (g), at the end thereof insert "except where failure of such
contract, agreement or instrument to be in full force and effect will not
have a material adverse effect on the Lessee's business operations."
8) Section 9. "Delivery and Return."
--------------------
Insert the following between the second and third sentences, insert:
"Lessee may remove any alteration or attachment to the Equipment not
specifically required to be delivered to Lessor hereunder or which is not
permanently attached to the Equipment."
Fourth sentence, line 2, after the words "operation in place" insert
"during normal business hours and so long as it does not unreasonably
interfere with Lessee's operations".
9) Section 10. "Labeling."
---------
In line 1, after "Lessee will" insert "use best efforts".
10) Section 11. "Indemnity."
----------
Second sentence, line 3, after the words "negligent acts" insert "or
willful misconduct".
At the end of this section insert the following:
"Lessor shall not enter into any settlement or other compromise with
respect to any claim covered by the indemnity set forth in this section
without Lessee's prior written consent, which shall not be unreasonably
withheld, conditioned or delayed, and if a claim is settled or compromised
without such consent, Lessee shall not be obligated to provide
indemnification under this section. If Lessor or any other indemnified
party obtains recovery of any of the amounts that Lessee has paid to them
pursuant to the indemnity set forth in this section, then Lessor or such
other indemnified party, as applicable, shall promptly pay to Lessee the
amount of such recovery.".
11) Section 13.1 "Default."
--------
In paragraph (b), line 4, delete "ten (10) business" and replace with
"thirty (30)".
12) Section 13.2. "Remedies."
---------
In paragraph (d), line 5, after "negligence" insert "or willful
misconduct."
To the end of this section add: "Any such successive or cumulative exercise
is not intended to provide Lessor with a greater return than it would have
received had Lessee fully performed under the terms of the applicable
Summary Equipment Schedule."
13) Section 14.1 "Board Attendance."
-----------------
Delete this section in its entirety.
14) Section 14.2 "Financial Statements."
---------------------
First sentence, lines 2 and 3, delete "the same information which Lessee
provides to its Board of Directors, but which will include not less than"
and on line 4, delete "statement of cash flows".
Second sentence, line 3, after "comparative form" insert "(if applicable")
and replace "ninety (90)" with "one hundred twenty (120)".
In the last sentence, delete the term "Financial Statements will be deemed
to refer to only those statements required by the Securities and Exchange
Commission" and replace with "This section shall be of no further force or
effect."
15) Section 14.3., "Obligation to Lease Additional Equipment"
----------------------------------------
In line 3, after "or any Schedule" insert "and such default has not been
cured or waived". In line 4, after "under any loan agreement" insert "so
long as such default exists,".
15) Section 14.4 "Merger and Sale Provisions."
---------------------------
First sentence, lines 1 and 2, delete "at least sixty (60) days prior to
the closing date" and insert "no later than the date notice thereof is
provided to Lessee's shareholders".
At the end of this section add, "Lessor's consent hereunder will not be
unreasonably delayed or conditioned."
16) Section 14.14 "Secretary's Certificate."
------------------------
Delete the last sentence of this section.
[Remainder of this page intentionally left blank]
17) Section 14.18 "Definitions."
-------------
Definition of "Casualty Value", is revised in its entirety to read: "means
--------------
the value specified in the Casualty Value table attached hereto and made a
part hereof."
Except as amended hereby, all other terms and conditions of the Master Lease
Agreement remain in full force and effect.
CHORUM TECHNOLOGIES, INC. COMDISCO, INC. as LESSOR
as LESSEE as LESSOR
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------- -------------------------
Title: President and CEO Title: President
------------------------ -----------------------
Date: 9/23/98 Date: 9/28/98
------------------------ -----------------------
LOAN AND SECURITY AGREEMENT
THIS AGREEMENT (the "Agreement"), dated as of September 22, 1998 is entered into
by and between Chorum Technologies, Inc., a Delaware corporation having a
principal place of business at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇ (the "Borrower") and Comdisco, Inc., a Delaware corporation having a
principal place of business at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(the "Lender" ). In consideration of the mutual agreements contained herein, the
parties hereto agree as follows:
WHEREAS, Borrower desires to borrow from the Lender hereunder the amount of
EIGHT HUNDRED SEVENTY THOUSAND SIX HUNDRED EIGHT-THREE AND 37/00 DOLLARS
($870,683.37) and Lender is willing to lend said amount to Borrower on September
30, 1998 (the "Funding Date");
NOW, THEREFORE, it is agreed:
SECTION 1. THE LOAN
1.1 Subject to the terms and conditions set forth herein, Lender shall
lend to Borrower the aggregate original principal of EIGHT HUNDRED SEVENTY
THOUSAND SIX HUNDRED EIGHT-THREE AND 37/00 DOLLARS ($870,683.37) (the "Loan")
with interest at the rate of seven and one quarter percent (7.25%) per annum
payable in monthly installments as set forth in the promissory note (the
"Note") in the form attached hereto and made a part hereof as Exhibit A, dated
September 30, 1998.
1.2 Upon the occurrence of and during an Event of Default (as defined
herein), interest shall thereafter be calculated at a rate of five percent (5%)
in excess of the rate that would otherwise be applicable ("Default Rate"). All
such interest shall be due and payable in arrears, on the first day of the
following month.
1.3 Notwithstanding any provision in this Agreement, the Note, or any
other "Loan Document" (as defined herein), it is not the parties' intent to
contract for, charge or receive interest at a rate that is greater than the
maximum rate permissible by law which a court of competent jurisdiction shall
deem applicable hereto (which under the laws of the State of Illinois shall be
deemed to be the laws relating to permissible rates of interest on commercial
loans) (the "Maximum Rate"). If the Borrower actually pays Lender an amount of
interest, chargeable on the total aggregate principal Obligations of Borrower
under this Agreement and the Note (as said rate is calculated over a period of
time that is the longer of (i) the time from the date of this Agreement through
the maturity time as set forth on the Note, or (ii) the entire period of time
that any principal is outstanding on the Note), which amount of interest exceeds
interest calculated at the Maximum Rate on said principal chargeable over said
period of time, then such excess interest actually paid by Borrower shall be
applied first, to the payment of principal outstanding on the Note; second,
after all principal is repaid, to the payment of Lender's out of pocket costs,
expenses, and professional fees which are owed by Borrower to Lender under the
Agreement or the Loan Documents; and third, after all principal, costs,
expenses, and professional fees owed by Borrower to Lender are repaid, the
excess (if any) shall be refunded to Borrower.
1.4 In the event any interest is not paid when due hereunder, delinquent
interest shall be added to principal and shall bear interest on interest,
compounded at the rate set forth in section 1.1.
1.5 Upon and during the continuation of an Event of Default hereunder (as
defined herein), all Obligations, including principal, interest, compounded
interest, and reasonable professional fees, shall bear interest at a rate per
annum equal to the Default Rate.
1.6 Borrower shall have the option to prepay the Note, in whole or in
part, at any time after the date hereof by paying the principal amount together
with all accrued and unpaid interest with respect to such principal amount, as
of the date of such prepayment and the present value of the Balloon Payment as
described in the Note together with a prepayment premium equal to the
difference, if any, between (x) the amount being prepaid and (y) the present
value, discounted at the Treasury Rate, of each installment of principal and
interest being prepaid discounted to the date of prepayment. If the amount in
(x) is greater than the amount in (y), no prepayment premium shall be due. The
"Treasury Rate" shall mean the then prevailing yield on US Treasury Constant
Maturities for the most recent business day, as quoted in the Federal Reserve
Statistical Release H15, as of the date of prepayment for an obligation of
comparable maturity to the maturity date of the Note.
SECTION 2. SECURITY INTEREST
As security for the payment of all indebtedness ("Indebtedness") of the
Borrower to the Lender hereunder and under the Note, as the same may be renewed,
extended for any period or rearranged, and the performance by the Borrower of
its other obligations hereunder (the Indebtedness and such other obligations
being hereinafter sometimes collectively referred to as the "Obligations"), the
Borrower hereby assigns to the Lender, and grants to the Lender a first priority
security interest in, all the Borrower's right, title, and interest in and to
the following property ("Collateral"): (i) the equipment and other property (the
"Equipment") described in Exhibit B attached hereto; and (ii) all proceeds,
products, replacements, additions to, substitutions for and accessions to any
and all Equipment including, without limitation, the proceeds applicable to the
insurance referred to in Section 4 hereof.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF BORROWER
The Borrower represents, warrants and agrees that:
3.1 it has good title in and to the Equipment, free of all liens, security
interests, encumbrances and claims whatsoever, except for the interest of the
Lender therein and Permitted Liens;
3.2 it has the full power and authority to, and does hereby grant and
convey to the Lender, a valid first priority (and when the requisite financing
statements are properly filed) perfected security interest in the Equipment as
security for the Obligations, free of all liens, security interests,
encumbrances and claims other than Permitted Liens, and shall execute such
Uniform Commercial Code ("UCC") financing statements in connection herewith as
the Lender may reasonably request. No other lien, security interest, adverse
claim or encumbrance has been created by Borrower or is known by Borrower to
exist with respect to any Collateral other than Permitted Liens. Permitted Liens
means the following;
(a) liens for taxes, fees, assessments or other governmental charges or
levies, either not delinquent or being contested in good faith by appropriate
proceedings, provided the same have no priority over any of Lender's security
interests:
(b) liens securing claims or demands or materialmen, mechanics, carriers,
warehousemen, landlords and other like persons or entities imposed without
action of such parties, provided that the payment thereof is not yet required;
and
(c) liens arising from judgements, decrees or attachments in
circumstances not constituting an Event of Default hereunder.
3.3 it is a corporation duly organized, legally existing and in good
standing under the laws of the State of Delaware, and is duly qualified as a
foreign corporation in all jurisdictions where the failure to so qualify would
have a material adverse effect on the Collateral or the business of the Borrower
taken as a whole;
3.4 the execution, delivery and performance of the Note, this Agreement,
the Warrant Agreement dated September __, 1998 pursuant to which Borrower
granted to Lender the right to purchase the number of shares of preferred stock
as set forth therein ("Warrant Agreement"), and all financing statements,
certificates and other documents required to be delivered or executed in
connection herewith (collectively, the "Loan Documents") have been duly
authorized by all necessary corporate action of Borrower, the individual or
individuals executing the Documents were duly authorized to do so, the Equipment
is personal property and as used by the Borrower will not be or become fixtures
under applicable law, with the exception of the fixtures listed on Exhibit B,
and the Loan Documents constitute legal, valid and binding obligations of the
Borrower, enforceable in accordance with their respective terms, subject to
applicable bankruptcy, insolvency, reorganization or other similar laws
generally affecting the enforcement of the rights of creditors;
3.5 the Loan Documents do not and will not violate any provisions of its
articles or certificate of incorporation, bylaws or any contract, agreement,
law, regulation, order, injunction, judgment, decree or writ to which the
Borrower is subject, or result in the creation or imposition of any lien,
security interest or other encumbrance upon the Collateral, other than those
created by this Agreement;
3.7 the execution, delivery and performance of the Loan Documents do not
require the consent or approval of any other person or entity including, without
limitation, any regulatory authority or governmental body of the United States
or any state thereof or any political subdivision of the United States or any
state thereof.
SECTION 4. INSURANCE AND RISK OF LOSS
4.1 Risk of loss of, damage to or destruction of the Equipment shall be
borne by the Borrower and effective upon the Funding Date under the Note and
until the payment and performance in full of all Obligations, Borrower shall at
its own expense cause to be carried and maintained all risk casualty insurance
(covering risk of fire, theft and other such risks as similarly situated
companies insure against) with respect to each item of Equipment in an amount no
less than the replacement costs applicable to such item of Equipment during the
term of this
Agreement. All policies evidencing such casualty insurance shall contain
a standard mortgagee's endorsement and shall provide for at least thirty days
prior written notice by the underwriter or insurance company to the Lender in
the event of cancellation or expiration. Borrower shall provide Lender with
insurance certificates evidencing the foregoing at time of closing.
4.2 If any item of Equipment is lost or rendered unusable as a result of
any physical damage to or destruction of such item of Equipment during the
period from the Funding Date to the date all Obligations hereunder have been
fully satisfied, Borrower shall give to Lender prompt notice thereof. Borrower
shall determine, within fifteen (15) days after the date of occurrence of such
loss, damage or destruction, whether such item of Equipment can be repaired and
restored to the condition in which such item of Equipment was required to be
maintained as of the date immediately preceding such damage. If Borrower
determines that such item of Equipment can be repaired and Borrower elects to
make such repairs, Borrower, at its expense, shall cause such item of Equipment
to be promptly repaired If Borrower determines that such item of Collateral is
lost, cannot be repaired or Borrower elects not to make repairs, Borrower shall
promptly notify the Lender and such item of Equipment shall be deemed to have
suffered a "Casualty Loss" for purposes of this Section as of the date of the
occurrence of such loss. Within fifteen (15) days following the occurrence of
any such loss, damage or destruction, Borrower shall notify the Lender of the
item(s) of Equipment which has suffered such Casualty Loss ("Loss Item"), and
within thirty (30) days thereafter (the "Settlement Date"), Borrower shall
either (a) replace such item(s) of Equipment with equipment of the same model,
type and feature configuration, in an operating condition and repair no less
than that required hereunder of the damaged or lost equipment immediately prior
to the date of such damage or loss, in which case such replacement equipment
shall for all purposes hereunder become part of the Collateral and (without
limiting the preceding provisions) Borrower shall grant to Lender a first lien
and security interest in respect of such replacement equipment pursuant to the
terms of this Agreement, and Borrower shall provide the Lender evidence
satisfactory to the Lender of Borrower's good and marketable title to such
replacement equipment (free of any liens, security interests or encumbrances
other than those created by this Agreement and Permitted Liens and Borrower
shall be entitled to receive the amount of any insurance or other recovery
received by Lender up to cost of obtaining the replacement equipment; or (b) so
long as no Event of Default or event which with the giving of notice or passage
of time, or both, would constitute an Event of Default, has occurred and is
continuing, Borrower may provide substitute equipment satisfactory to Lender to
become part of the Collateral and Borrower shall grant to Lender a first lien
and security interest in respect of such substitute equipment pursuant to the
terms of this Agreement, and Borrower shall provide the Lender evidence
satisfactory to Lender of Borrower's good and marketable title to such
substitute equipment (free of any liens, security interests or encumbrances
other than created by this Agreement and Permitted Liens and Lender shall
provide any required endorsements in connection with any insurance proceeds
received by Borrower pursuant to such insurance policies; or (c) Borrower shall
pay Lender the insurance proceeds payable pursuant to such insurance policies
("Insurance Proceeds")with respect to such Loss Item(s) and the principal amount
of the Note (and interest accrued on the principal amount so prepayable) shall
become due and payable on the Settlement Date to the extent of the replacement
cost for all such Loss Item(s). Moneys so received shall be applied, on the date
of such receipt, as follows: first, to pay any accrued interest on the
outstanding principal amount of the Note on such date; second, to prepay, the
outstanding principal amount of the Note (to the extent of the Casualty Value
(See Exhibit 1 ) of such Loss Item(s)); third, to pay any other Indebtedness of
amounts then due and owing to the Lender hereunder; and fourth, so long as there
has occurred no Event of
Default under Section 8 hereof and no event which with the giving of notice or
passage of time or both would constitute an Event of Default, has occurred and
is continuing, Borrower and Lender hereby agree that the balance of any such
Insurance Proceeds shall be paid promptly to the Borrower.
4.3 Effective upon the Funding Date under the Note and while there are
any Obligations outstanding, Borrower shall cause to be carried and maintained
comprehensive general liability insurance with regard to the Collateral against
risks customarily insured against in the Borrower's business. Such risks shall
include, without limitation, the risks of death, bodily injury and property
damage associated with the Collateral. All policies evidencing such insurance
shall provide for at least thirty (30) days prior written notice by the
underwriter or insurance company to the Lender in the event of cancellation or
expiration.
4.4 Borrower shall and does hereby indemnify and hold Lender, its agents
and shareholders harmless from and against any and all claims, costs, expenses,
damages and liabilities (including without limitation such claims, costs,
expenses, damages and liabilities based on liability in tort including without
limitation strict liability in tort) including reasonable attorneys' fees,
arising out of Borrower's ownership, possession, operation, control, use,
maintenance, delivery, or other disposition of the Collateral. Notwithstanding
the foregoing, Borrower shall not be responsible under the terms of this Section
4.4 to a party indemnified hereunder for any claims, costs, expenses, damages
and liabilities occasioned by the negligence or willful misconduct of such
indemnified party.
Lender may not enter into any settlement or other compromise with respect
to any claim covered by the indemnity set forth in this section without
Borrower's prior written consent, which shall not be unreasonably withheld,
conditioned or delayed, and if a claim is settled or compromised without such
consent, Borrower shall not be obligated to provide indemnification under this
section. If Lender or any other indemnified party obtains recovery of any of the
amounts that Borrower has paid to them pursuant to the indemnity set forth in
this section, then Lender or such other indemnified party, as applicable, shall
promptly pay to Borrower the amount of such recovery.
SECTION 5. COVENANTS OF BORROWER
Borrower covenants and agrees as follows at all times while any of the
Obligations remain outstanding:
5.1 Borrower shall maintain the Equipment in good operating order, repair,
condition and appearance and protect the Equipment from deterioration, other
than normal wear and tear. Borrower shall not use any of the Equipment or permit
its use for any purpose other than for which it was designed. Borrower's
obligation regarding the maintenance of the Equipment shall include, without
limitation, all maintenance, repair, refurbishment and replacement recommended
or advised either by the manufacturer, or that commonly performed by prudent
business and/or professional practice. Any exceptions or qualifications
expressed in this Agreement relating to normal or ordinary wear and tear shall
not be deemed to limit Borrower's obligations pursuant to the preceding
sentence.
5.2 Borrower shall only relocate any item of the Equipment provided
that: (a) it shall have caused to be filed and/or delivered to the Lender all
UCC financing statements, certificates or other documents or instruments
necessary to continue in effect the first prior perfected security interest of
the Lender in the Collateral, and (b) it shall have given the Lender no less
than fifteen (15) days prior written notice of such relocation;
5.3 In the event Borrower adds or installs any Upgrade (as hereinafter
defined) on the Equipment, at the request of Lender, Borrower shall, upon
Lender's demand made in conjunction with a sale or other disposition of the
Equipment during the occurrence of an Event of Default, remove any such Upgrade
and restore the Equipment to the condition in which such Equipment is required
to be maintained hereunder as if such Upgrade had never been attached thereto.
Borrower will not, without the prior written consent of Lender (which shall not
unreasonably withheld, delayed or conditioned in the case of tenant
improvements) and subject to such conditions as Lender may impose for its
protection, affix the Equipment to any real property if, as a result thereof,
the Equipment could become a fixture under applicable law.
For purposes hereof and all Loan Documents relating hereto, the term
"Upgrade" shall mean: (i) any accessory, equipment or device manufactured or
sold by the manufacturer of the Equipment for installation on the Equipment and
installed in compliance with said manufacturer's installation procedures (other
than those added by the manufacturer in order to maintain the Equipment at
current engineering levels), or (ii) any other accessory, equipment or device
installed on the Equipment so long as such item does not impair the original
function or use of the Equipment, capable of being removed without causing
material damage to the Equipment and does not decrease the fair market value of
the Equipment. An Upgrade shall not become an accession to the Equipment. For
purposes hereof and of all Loan Documents relating hereto, the term "Equipment"
shall not be deemed to include any such Upgrade.
5.4 Upon the request of Lender, Borrower shall, during business hours,
make the Equipment available to Lender for inspection at the place where it is
normally located and shall make Borrower's log and maintenance records
pertaining to the Equipment available to the Equipment available to Lender for
inspection. Borrower shall take all action necessary to maintain such logs and
maintenance records in a correct and complete fashion.
5.5 Upon the request of Lender, Borrower shall cause the Equipment to be
plainly, permanently and conspicuously marked, by stenciling or by metal tag or
plate affixed thereto, indicating Lender's security interest in the Equipment.
Borrower shall replace any such stenciling, tag or plate which may be removed or
destroyed or become illegible. Borrower shall keep all Equipment free from any
marking or labeling which might be interpreted as a claim of ownership adverse
to Borrower's.
5.6 Borrower covenants and agrees to pay when due, all taxes, fees or
other charges of any nature whatsoever (together with any related interest or
penalties) now or hereafter imposed or assessed against Borrower, Lender or the
Equipment or upon Borrower's ownership, possession, use, operation or
disposition thereof or upon Borrower's rents, receipts or earnings arising
therefrom. Borrower shall file on or before the due date therefor all personal
property tax returns in respect of the Equipment. The foregoing not
withstanding, Borrower need not make any payment described in this Section 5.6
if the amount or the validity thereof of such payment is being contested in good
faith by appropriate proceedings and is reserved against to the extent required
by GAAP.
5.7 Borrower shall furnish to Lender the financial statements listed
hereinafter, prepared in accordance with generally accepted accounting
principles consistently applied (the "Financial Statements"):
(a) as soon as practicable (and in any event within thirty (30) days)
after the end of each month: an intemally prepared income statement and
balance sheet, each prepared in accordance with generally accepted
accounting principles, consistently applied , (including a report as to the
commencement of any material litigation by or against Borrower;
(b) as soon as practicable (and in any event within one hundred twenty
(120) days) after the end of each fiscal year, audited Financial
Statements, setting forth in comparative form the corresponding figures for
the preceding fiscal year (if available), and accompanied by any audit
report and opinion of the independent certified public accountants selected
by Borrower; and
(c) promptly any additional information (including but not limited to
tax returns, income statements, balance sheets, and names of principal
creditors) as Lender reasonably believes necessary to evaluate Borrower's
continuing ability to meet financial obligations.
5.8 Notwithstanding the foregoing, after the effective date of the
initial registration statement covering a public offering of Borrower's
securities, the term "Financial Statements" shall be deemed to refer to only
those statements required by the Securities and Exchange Commission, to be
provided no less frequently than quarterly. Borrower will from time to time
execute, deliver and file, alone or with Lender, any financing statements,
security agreements or other documents; and take all further action that may be
necessary, or that Lender may reasonably request, to confirm, perfect, preserve
and protect the security interests intended to be granted hereby, and in
addition, and for such purposes only, Borrower hereby authorizes Lender to
execute and deliver on behalf of Borrower and to file such financing statements,
security agreement and other documents without the signature of Borrower either
in Lender's name or in the name of Borrower as agent and attorney-in-fact for
Borrower.
5.9 Borrower shall protect and defend Borrower's title as well as the
interest of the Lender against all persons claiming any interest adverse to
Borrower or Lender and shall at all times keep the Collateral free and clear
from any attachment or levy, liens or encumbrances whatsoever (except any placed
thereon by Lender, or any Permitted Liens) and shall give Lender immediate
written notice thereof.
5.10 Upon the occurrence of an Event of Default, if Lender seeks to
foreclose on the Equipment, Borrower shall be liable for the full expense of
transportation and in-transit insurance to Lender's, Borrower's liability for
expense of transportation of the Equipment shall be limited to the costs of
transportation to such warehouse space, Borrower will arrange for the
deinstallation and audit of the Equipment, and will pack; ship and send the
Equipment to Lender in good operating order, repair, condition and appearance,
and in a condition required pursuant to Section 5.1 hereof.
SECTION 6. CONDITIONS PRECEDENT TO LOAN
On or prior to the Funding Date, Borrower will provide to Lender the
following, in form and substance satisfactory to Lender:
6.1 Such documentation, including, without limitation, a ▇▇▇▇ of Sale,
and other documents as shall reasonably evidence Borrower's right, title and
interest in and to the Equipment;
6.2 A certified resolution or other certificate of corporate authority for
the execution and the delivery of, and the performance of all Obligations under
the Loan Documents and all related documentation;
6.3 Incumbency certificate evidencing the authority and facsimile
signatures of the individuals executing the Loan Documents;
6.4 UCC financing statements as deemed appropriate by Lender to perfect
its security interest in the Collateral;
6.5 Certified copies of the Certificate of Incorporation of Borrower;
6.6 Certificate of good standing for Borrower from its state of
incorporation and similar certificates from all jurisdictions in which it does
business and where the failure to be qualified would have a material adverse
effect on Borrower's business; and
6.7 Insurance certificates as required by Section 4 hereof.
SECTION 7. ASSIGNMENT BY LENDER
7.1 Borrower acknowledges and understands that Lender may sell and assign
all or a part of its interest hereunder and under the Note and Loan Documents to
any person or entity (an "Assignee"). After such assignment the term Lender
shall mean such Assignee, and such Assignee shall be vested with all rights,
powers and remedies of Lender hereunder with respect to the interest so
assigned; but with respect to any such interest not so transferred, the Lender
shall retain all rights, powers and remedies hereby given. No such assignment by
Lender shall relieve Borrower of any of its obligations hereunder. Borrower
shall acknowledge such assignment or assignments as shall be designated by
written notice given by Lender to Borrower. The Lender agrees that in the event
of any transfer by it of the Note, it will endorse thereon a notation as to the
portion of the principal of the Note which shall have been paid at the time of
such transfer and as to the date to which interest shall have been last paid
thereon.
SECTION 8. DEFAULT
The occurrence of any one or more of the following events (herein called
"Events of Default") shall constitute a default hereunder and under the Note:
8.1 The Borrower defaults in the payment of any principal or interest
payable under the Note for more than five (5) days after the receipt of notice
of such an Event of Default from Lender;
8.2 The Borrower defaults in the payment or performance of any other
covenant or obligation of the Borrower hereunder or under the Note or any other
Loan Documents for more than thirty (30) days after the Lender has given notice
of such default to the Borrower;
8.3 Any representation or warranty made herein by the Borrower shall
prove to have been false or misleading in any material respect as of the date
made;
8.4 The making of an assignment by Borrower for the benefit of its
creditors or the admission by Borrower in writing of its inability to pay its
debts as they become due, or the insolvency of Borrower, or the filing by
Borrower of a voluntary petition in bankruptcy, or the adjudication of Borrower
as a bankrupt, or the filing by Borrower of any petition or answer seeking for
itself any reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any present or future statute, law or
regulation, or the filing of any answer by Borrower admitting, or the failure by
Borrower to deny, the material allegations of a petition filed against it for
any such relief, or the seeking or consenting by Borrower to, or acquiescence by
Borrower in, the appointment of any trustee, receiver or liquidator of Borrower
or of all or any substantial part of the properties of Borrower, or the
inability of Borrower to pay its debts when due, or the commission by Borrower
of any act of bankruptcy as defined in the Federal Bankruptcy Act, as amended;
8.5 The failure by Borrower, within sixty (60) days after the
commencement of any proceeding against Borrower seeking any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under any present or future statute, law or regulation, to obtain the
dismissal of such proceeding or, within sixty (60) days after the appointment,
without the written consent or acquiescence of Lender, of any trustee, receiver
or liquidator of Borrower or of all or any substantial part of the properties of
Borrower, to vacate such appointment; or
8.6 The occurrence of an Event of Default by Borrower under any other
notes or other agreement for borrowed money, lease or other agreement between
Borrower and Lender. The Event of Default under this Section 8.6 caused by the
occurrence of an Event of Default under another agreement described in this
Section 8.6 shall be automatically cured for purposes of this Agreement upon the
cure or waiver of the Event of Default under the other agreement.
SECTION 9. REMEDIES
Upon the occurrence hereof of any one or more Events of Default, Lender, at
its option, may declare the Note to be accelerated and immediately due and
payable, (provided, that upon the occurrence of an Event of Default of the type
described in Section 8.4 or Section 8.5, the Note and all other Obligations
shall automatically be accelerated and made due and payable without any further
act) whereupon the unpaid principal of and accrued interest on such Note shall
become immediately due and payable, and shall thereafter bear interest at the
Default Rate and calculated in accordance with Section 1.2. Lender may exercise
all rights and remedies with respect to the Collateral granted pursuant hereto
for such Note, or otherwise available to it under applicable law, including the
right to release, hold or otherwise dispose of all or any part of the Collateral
and the right to utilize, process and commingle the Collateral.
Upon the happening and during the continuance of any Event of Default,
Lender may then, or at any time thereafter and from time to time, apply,
collect, sell in one or more sales,
lease or otherwise dispose of, any or all of the Collateral, in its then
condition or following any commercially reasonably preparation or processing, in
such order as Lender may elect, and any such sale may be made either at public
or private sale at its place of business or elsewhere.
Borrower agrees that any such public or private sale may occur upon ten (10)
calendar day's notice to Borrower. Lender may require Borrower to assemble the
Collateral and make it available to Lender at a place designated by Lender which
is reasonably convenient to Lender and Borrower. The proceeds of any sale,
disposition or other realization upon all or any part of the collateral shall be
distributed by Lender in the following order of priorities:
First, to Lender in an amount sufficient to pay in full Lender's reasonable
costs and professionals' and advisors' fees and expenses;
Second, to Lender in an amount equal to the then unpaid amount of the
Obligations in such order and priority as Lender may choose in its sole
discretion; and
Finally, upon payment in full of all of the Obligations, to Borrower or its
representatives. or as a court of competent jurisdiction may direct.
The Lender shall return to the Borrower any surplus Collateral remaining-after
payment of all Obligations.
SECTION 10. MISCELLANEOUS
10.1 Borrower shall remain liable to Lender for any unpaid Obligations,
advances, costs, charges and expenses, together with interest thereon and shall
pay the same immediately to Lender at Lender's offices.
10.2 The powers conferred upon Lender by this Agreement are solely to
protect its interest in the Collateral and shall not impose any duty upon Lender
to exercise any such powers.
10.3 This is a continuing Agreement and the grant of a security interest
hereunder shall remain in full force and effect and all the rights, powers and
remedies of Lender hereunder shall continue to exist until the Obligations are
paid in full as the same become due and payable.
When Borrower has paid in full all Obligations, Lender will execute a written
termination statement, reassigning to Borrower, without recourse, the Collateral
and all rights conveyed hereby and return possession (if Lender has possession)
of the Collateral to Borrower. The rights, powers and remedies of Lender
hereunder shall be in addition to all rights, powers and remedies given by
statute or rule of law and are cumulative. The exercise of any one or more of
the rights, powers and remedies provided herein shall not be construed as a
waiver of any other rights, powers and remedies of Lender. Furthermore,
regardless of whether or not the UCC is in effect in the jurisdiction where such
rights, powers and remedies are asserted, Lender shall have the rights, powers
and remedies of a secured party under the UCC.
10.4 Upon payment in full of all Obligations, the Lender shall cancel the
Note, this Agreement and all UCC financing statements, if any, and shall
promptly deliver all such canceled documents to the Borrower.
10.5 GOVERNING LAW. This Agreement, the Note and the other Loan Documents
have been negotiated and delivered to Lender in the State of Illinois and shall
not become
effective until accepted by Lender in the State of Illinois. Payment to Lender
by Borrower of the Obligations is due in the State of Illinois. This Agreement
shall be governed by, and construed and enforced in accordance with the laws of
the State of Illinois excluding conflict of laws principles that would cause the
application of laws of any other jurisdiction.
10.6 CONSENT TO JURISDICTION AND VENUE. All judicial proceedings arising
in or under or related to this Agreement, the Note or any of the other Loan
Documents may be brought in any state or federal court of competent jurisdiction
located in the State of Illinois. By execution and delivery of this Agreement,
each party hereto generally and unconditionally: (a) consents to personal
jurisdiction in ▇▇▇▇ County, State of Illinois; (b) waives any objection as to
jurisdiction or venue in the aforesaid courts; and (d) irrevocably agrees to be
bound by any judgment rendered thereby in connection with this Agreement, the
Note an the other Loan Documents. Service of process on any party hereto in any
action arising out of or relating to this agreement shall be effective if given
in accordance with the requirements for notice set forth in subsection 10.8
below and shall be deemed effective and received as set forth in subsection 10.8
below. Nothing herein shall affect the right to serve process in any other
manner permitted by law or shall limit the right of either party to bring
proceedings in the courts of any other jurisdiction.
10.7 Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
such law, such provision shall be ineffective only to the extent and duration of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
10.8 Any notice required or given hereunder shall be deemed properly
given upon the earlier of: (i) the first business day after transmission by
facsimile or hand delivery or deposit with an overnight express service or
overnight mail delivery service; or (ii) or three (3) days after mailed, postage
prepaid, in each case, addressed to the designated recipient at its address set
forth herein or such other address as such party may advise the other party by
notice given in accordance with this provision.
10.9 Lender and Borrower acknowledge that there are no agreements or
understandings, written or oral, between Lender and Borrower with respect to the
Loan, other than as set forth herein, in the Note and the other Loan Documents
and that this Agreement, the Note and the other Loan Documents contain the
entire agreement between Lender and Borrower with respect thereto. None of the
terms of this Agreement, the Note and the other Loan Documents may be amended
except by an instrument executed by each of the parties hereto.
10.10 No omission, or delay, by Lender at any time to enforce any right
or remedy reserved to it, or to require performance of any of the terms,
covenants or provisions hereof by Borrower at any time designated, shall be a
waiver of any such right or remedy to which Lender is entitled, nor shall it in
any way affect the right of Lender to enforce such provisions thereafter.
10.11 All agreements, representations and warranties contained in this
Agreement or the Note, or in any Loan Documents delivered pursuant hereto or in
connection herewith shall be for the benefit of Lender and any Assignee and
shall survive the execution and delivery of this Agreement or the Note and the
expiration or other termination of this Agreement or the Note.
10.12 This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all such counterparts together
shall constitute but one and the same instrument.
10.13 This Agreement shall be binding upon, and shall inure to the
benefit of, Borrower and its permitted assigns (if any). Borrower shall not
assign its obligations under this Agreement, the Note or any of the other Loan
Documents without Lender's express written consent and any such attempted
assignment shall be void and of no effect. Any assignment by Borrower in
connection with a "Merger" (as defined below) shall be subject to Lender's prior
consent. Any consent granted by Lender shall be conditioned upon such surviving
entity or transferee assuming Borrower's Obligations hereunder pursuant to
assignment documents reasonably acceptable to Lender. If Lender reasonably
withholds its consent to such assignment in connection with a Merger, the
outstanding principal and accrued and unpaid interest shall be prepaid in whole.
Lender hereby consents to any Merger in which the acquiring entity has a Moodys
Bond Rating of BA3 or better or a commercially acceptable equivalent measure of
creditworthiness as reasonably determined by Lessor. Lender's consent hereunder
will not be unreasonably delayed or conditioned.
For purposes of this Agreement, a "Merger" shall mean any consolidation or
merger of the Borrower with or into any other corporation or entity, any sale or
conveyance of an or substantially ail of the assets or stock of the Borrower by
or to any other person or entity in which Borrower is not the surviving entity.
IN WITNESS WHEREOF, the Borrower and the Lender have duly executed and
delivered this Agreement as of the day and year first above written.
BORROWER: CHORUM TECHNOLOGIES, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Title: President and CEO
--------------------------------
Date: 9/23/98
--------------------------------
ACCEPTED IN ROSEMONT, ILLINOIS:
------------------------------
LENDER: COMDISCO, INC.
By:
-----------------------------------
Title:
--------------------------------
Date:
--------------------------------
SECURED PROMISSORY NOTE
$870,683.37 Date: September 30, 1998
Due: October 1, 2002
FOR VALUE RECEIVED, CHORUM TECHNOLOGIES, INC. a Delaware corporation (the
"Borrower") hereby promises to pay to the order of Comdisco, Inc., a Delaware
corporation (the "Lender") at ▇.▇. ▇▇▇ ▇▇▇▇▇., ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ or such other
place of payment as the holder of this Secured Promissory Note (this "Note") may
specify from time to time in writing, in lawful money of the United States of
America, the principal amount of Eight Hundred Seventy Thousand Six Hundred
Eighty-three and 37/100 Dollars ($870,683.37) together with interest at seven
and one quarter percent (7.25%) per annum from the date of this Note to maturity
of each installment on the principal hereof remaining from time to time unpaid,
such principal and interest to be paid in 48 equal monthly installments of
$20,954.93 each, commencing November 1, 1998 and on the same day of each month
thereafter to and including October 1, 2002 and an additional installment in the
amount of $130,602.51 ("Balloon Payment") to be paid on October 1, 2002, such
installments to be applied first to accrued and unpaid interest and the balance
to unpaid principal. Interest shall be computed on the basis of a year
consisting of twelve months of thirty days each.
This Note is the Note referred to in, and is executed and delivered in
connection with, that certain Loan and Security Agreement dated as of September
22, 1998 by and between Borrower and Lender (as the same may from time to time
be amended, modified or supplemented in accordance with its terms, the "Loan
Agreement"), and is entitled to the benefit and security of the Loan Agreement
and the other Loan Documents (as defined in the Loan Agreement), to which
reference is made for a statement of all of the terms and conditions thereof.
All terms defined in the Loan Agreement shall have the same definitions when
used herein, unless otherwise defined herein to the extent that the terms and
conditions in the Loan Agreement are in conflict with the terms and conditions
of this note, the terms and conditions of the Loan Agreement shall control.
The Borrower waives presentment and demand for payment, notice of dishonor,
protest and notice of protest and any other notice as permitted under the UCC or
any applicable law.
This Note has been negotiated and delivered to Lender and is payable in the
State of Illinois, and shall not become effective until accepted by Lender in
the State of Illinois. This Note shall be governed by and construed and enforced
in accordance with, the laws
NOTE DOC
of the State of Illinois, excluding any conflicts of law rules or principles
that would cause the application of the laws of any other jurisdiction.
BORROWER: CHORUM TECHNOLOGIES, INC.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Signature: /s/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Print Name: ▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Title: President and CEO
---------------------------------------
EXHIBIT 1
This Financing Statement covers the following Collateral pledged by Chorum
Technologies, Inc. ("Debtor") to Comdisco, Inc. ("Secured Party") pursuant to
the Loan and Security Agreement dated as of September 22, 1998 between Chorum
Technologies, Inc. as Borrower and Comdisco, Inc. as Lender ("Loan Agreement")
for purposes of securing payment of the Obligations (as defined in the Loan
Agreement) now and hereafter owing by Debtor to Secured Party pursuant to that
Secured Promissory Note dated September 30, 1998.
All of the Debtor's right, title and interest in: (I) the equipment and other
property (the "Equipment") described on Exhibit B attached hereto; and (ii) all
proceeds, products, replacements, additions to, substitutions for and
accessories to any and all Equipment including, without limitation, proceeds
applicable to insurance.
EQUIPMENT SCHEDULE VL-1
DATED AS OF SEPTEMBER 22,1998
TO MASTER LEASE AGREEMENT
DATED AS OF SEPTEMBER 22, 1998 (THE "MASTER
LEASE")
LESSEE: CHORUM TECHNOLOGIES, INC. LESSOR: COMDISCO, INC.
Admin. Contact/Phone No.: Address for all Notices:
------------------------ -----------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ Attn.: Venture Group
Address for Notices:
-------------------
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇. ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Central Billing Location: Rent Interval: Monthly
------------------------ -------------
same as above
Attn.:
Lessee Reference No.:
-------------------
(24 digits maximum)
Location of Equipment: same as above Initial Term: 48 months
--------------------- ------------
(Number of Rent Intervals)
Lease Rate Factor: 2.392%
-----------------
Attn.:
EQUIPMENT (as defined below): Advance: None
-------
Interim Rent: None
------------
Equipment specifically approved by Lessor, which shall be delivered to and
accepted by Lessee during the period September 22, 1998 through September 22,
1999 ("Equipment Delivery Period"), for which Lessor receives vendor invoices
approved for payment, up to an aggregate purchase price of $1,259,019.90
("Commitment Amount"); excluding custom use equipment, leasehold improvements,
installation costs and delivery costs, rolling stock, special tooling, "stand-
alone" software, application software bundled into computer hardware, hand held
items, molds and fungible items.
1. Equipment Purchase
This Schedule contemplates Lessor's acquisition of Equipment for lease to
Lessee, either by one of the first three categories listed below or by providing
Lessee with Equipment from the fourth category, in an aggregate value up to the
Commitment Amount referred to on the face of this Schedule. If the Equipment
acquired is of category (i), (ii) , (iii) below, the effectiveness of this
Schedule as it relates to those items of Equipment is contingent upon Lessee's
acknowledgment at the time Lessor acquires the Equipment that Lessee has either
received or approved the relevant purchase documentation between vendor and
Lessor for that Equipment.
(i) NEW ON-ORDER EQUIPMENT. Lessor will purchase new Equipment which is
obtained from a vendor by Lessee for its use subject to Lessor's
prior approval of the Equipment.
(ii) SALE-LEASEBACK EQUIPMENT. Any in-place Equipment installed at
Lessee's site and to which Lessee has clear title and ownership may
be considered by Lessor for inclusion under this Lease (the "Sale-
Leaseback Transaction"). Any request for a Sale-Leaseback
Transaction must be submitted to Lessor in writing (along with
accompanying evidence of Lessee's Equipment ownership satisfactory
to Lessor for all Equipment submitted) no later than October 22,
1998*. Lessor will not perform a Sale-Leaseback Transaction for any
request or accompanying Equipment ownership documents which arrive
after the date marked above by an asterisk (*). Further, any sale-
leaseback Equipment will be placed on lease subject to: (1) Lessor
prior approval of the Equipment; and (2) if approved, at Lessor's
actual net appraised Equipment value pursuant to the schedule
below:
ORIGINAL EQUIPMENT INVOICE PERCENT OF ORIGINAL MANUFACTURER'S
DATE NET EQUIPMENT COST PAID BY LESSOR
---------------------------------
Between 10/22/97-10/22/98(360 days) 100%
(iii) USED ON-ORDER EQUIPMENT. Lessor will purchase used Equipment which is
obtained from a third party by Lessee for its use subject to
Lessor's prior approval of the Equipment and at Lessor's appraised
value for such used Equipment.
(iv) 800 NUMBER EQUIPMENT. Upon Lessee's use of Comdisco's 1-800 Direct
Service, Lessor will purchase new or used Equipment from a third
party or Lessor will supply new or used Equipment from its
inventory for use by Lessee at rates provided by Lessor.
2. Commencement Date
The Commencement Date for each item of new on-order or used on-order
Equipment will be the install date as confirmed in writing by Lessee as set
forth on the vendor invoice of which a facsimile transmission will constitute an
original document. The Commencement Date for sale-leaseback Equipment shall be
the date Lessor tenders the purchase price. The Commencement Date for 800 Number
Equipment shall be fifteen (15) days from the ship date, such ship date to be
set forth on the vendor invoice or if unavailable on the vendor invoice the ship
date will be determined by Lessor upon other supporting shipping documentation.
Lessor will summarize all approved invoices, purchase documentation and evidence
of delivery, as applicable, received in the same calendar quarter into a Summary
Equipment Schedule in the form attached to this Schedule as Exhibit 1, and the
Initial Term will begin the first day of the calendar quarter thereafter. Each
Summary Equipment Schedule will contain the Equipment location, description,
serial number(s) and cost and will incorporate the terms and conditions of the
Master Lease and this Schedule and will constitute a separate lease.
3. Option to Extend
So long as no Event of Default has occurred and is continuing hereunder,
and upon written notice no earlier than twelve (12) months and no later than
ninety (90) days prior to the expiration of the Initial Term of a Summary
Equipment Schedule, Lessee will have the right to extend the Initial Term of
such Summary Equipment Schedule for a period of one (1) year. In such event, the
rent to be paid during said extended period shall be mutually agreed upon and if
the parties cannot mutually agree within ninety (90) days of the expiration of
the Initial Term, then Lessee may revoke its election to extend the Initial Term
by notice given to Lessor within five (5) days thereafter. If such notice is not
given and an impasse is reached, then the Summary Equipment Schedule shall
continue in full force and effect pursuant to the existing terms and conditions
until terminated in accordance with its terms. The Summary Equipment Schedule
will continue in effect following said extended period until terminated by
either party upon not less than ninety (90) days prior written notice, which
notice shall be effective as of the date of receipt.
4. Purchase Option
So long as no Event of Default has occurred and is continuing hereunder,
and upon written notice no earlier than twelve (12) months and no later than
ninety (90) days prior to the expiration of the Initial Term or the extended
term of the applicable Summary Equipment Schedule, Lessee will have the option
at the expiration of the Initial Term or the extended term of the Summary
Equipment Schedule to purchase all, but not less than all, of the Equipment
listed therein for a purchase price not to exceed 15% of Lessor's cost hereunder
and upon terms and conditions to be mutually agreed upon by the parties
following Lessee's written notice, plus any taxes applicable at time of
purchase. Said purchase price shall be paid to Lessor on the expiration date of
the Initial Term or extended term. Title to the Equipment shall automatically
pass to Lessee upon payment in full of the purchase price but, in no event,
earlier than the expiration of the fixed Initial Term or extended term, if
applicable Notwithstanding the exercise by Lessee of this option and payment of
the purchase price, until all obligations under the applicable Summary Equipment
Schedule have been fulfilled, it is agreed and understood that Lessor shall
retain a purchase money security interest in the Equipment listed therein and
the Summary Equipment Schedule shall constitute a Security Agreement under the
Uniform Commercial Code of the state in which the Equipment is located.
If the parties are unable to agree on the purchase price or the terms and
conditions with respect to said purchase within ninety (90) days of the
expiration of the Initial Term or the renewal term, as applicable, then Lessee
may revoke its election to purchase the Equipment by notice given to Lessor
within five (5) days thereafter. If such notice is not given and an impasse is
reached, the Summary Equipment Schedule shall continue in full force and effect
pursuant to the existing terms and conditions until terminated by either party
upon not less than ninety (90) days prior written notice, which notice shall be
effective as of the date of receipt.
5. Technology Exchange Option
So long as no Event of Default has occurred and is continuing, and there is
no material adverse change in Lessee's credit, on or after the expiration of the
12th month of any Summary Equipment Schedule, Lessee shall have the option to
replace any of the Equipment subject to such summary Equipment Schedule with new
technology equipment ("New Technology Equipment') utilizing the following
guidelines:
A. Equipment being replaced with New Technology Equipment shall have an
aggregate original cost equal to or greater than $20,000 and be comprised of
full configurations of equipment.
B. This technology Exchange Option shall be limited to a maximum in the
aggregate of fifty percent (50%) of the original equipment cost and shall not
apply to software or any soft costs financed hereunder including but not limited
to tenant improvements and custom equipment.
C. The cost of the New Technology Equipment must be equal to or greater than the
original equipment cost of the replaced equipment, but in no event shall exceed
150% of the original equipment cost.
D. The remaining lease payments applicable to the equipment being replaced by
the New Technology Equipment will be discounted to present value at 6%.
The wholesale market value of the equipment being replaced will be established
by Comdisco based upon then current market conditions. Upon the return of the
replaced equipment, the wholesale price will be deducted from the present value
of the remaining
rentals and the differential will be added to the cost of the New Technology
Equipment in calculating the new rental. The lease for the New Technology
Equipment will contain terms and conditions substantially similar to those for
the replaced equipment and will have an Initial Term not less than the balance
of the remaining Initial Term for the replaced equipment.
8. Special Terms
The terms and conditions of the Lease as they pertain to this Schedule are
hereby modified and amended as follows:
(a) Casualty Value Table is attached as Exhibit 2.
Master Lease: This Schedule is issued pursuant to the Lease identified on page 1
of this Schedule. All of the terms and conditions of the Lease are incorporated
in and made a part of this Schedule as if they were expressly set forth in this
Schedule. The parties hereby reaffirm all of the terms and conditions of the
Lease (including, without limitation, the representations and warranties set
forth in Section 8) except as modified herein by this Schedule. This Schedule
may not be amended or rescinded except by a writing signed by both parties.
CHORUM TECHNOLOGIES, INC. COMDISCO, INC.
as Lessee as Lessor
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------- --------------------------
Title: President and CEO Title: President
--------------------- -----------------------
Date: 9/28/98 Date: 9/28/98
--------------------- ------------------------
EXHIBIT 1
SUMMARY EQUIPMENT SCHEDULE
--------------------------
This Summary Equipment Schedule dated XXXX is executed pursuant to
Equipment Schedule No. X to the Master Lease Agreement dated XXXX between
Comdisco, Inc. ("Lessor") and XXXX ("Lessee"). All of the terms, conditions,
representations and warranties of the Master Lease Agreement and Equipment
Schedule No. X are incorporated herein and made a part hereof, and this Summary
Equipment Schedule constitutes a Schedule for the Equipment on the attached
invoices.
1. For Period Beginning: And Ending:
--------------------- ----------
2. Initial Term Starts on: Initial Term:
----------------------- -------------
(Number of Rent Intervals)
3. Total Summary Equipment Cost:
-----------------------------
4. Lease Rate Factor:
------------------
5. Rent:
-----
6. Acceptance Doc Type:
--------------------
EXHIBIT 2
---------
CASUALTY VALUE TABLE - MONTHLY
The Casualty Value applicable to an item of Equipment will be the acquisition
cost multiplied by the Casualty Value Percentage set forth below applicable to
that item.
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
DATE OF DELIVERY
TO INITIAL TERM
START DATE 108.0000% 108.0000% 108.0000% 108.0000% 108.0000%
YEAR ONE
1st (Month of 108.0000 108.0000 108.0000 108.0000 108.0000
2nd Initial Term) 106.4157 106.7446 106.9550 107.1970 107.3658
3rd 104.8130 105.4746 105.8979 106.3846 106.7242
4th 103.1915 104.1898 104.8284 105.5628 106.0751
5th 101.5512 102.8899 103.7464 104.7314 105.4185
6th 99.8917 101.5749 102.6518 103.8902 104.7451
7th 98.2128 100.2446 101.5444 103.0393 104.0821
8th 96.5143 98.8988 100.4241 102.1784 103.4021
9th 94.7961 97.5372 99.2908 101.3075 102.7143
10th 93.0578 96.1598 98.1442 100.4265 102.0184
11th 91.2992 94.7662 96.9842 99.5351 101.3144
12th 89.5201 93.3565 95.8107 98.6334 100.6022
YEAR TWO
1st (Month of 87.7202 91.9303 94.6236 97.7211 99.8817
2nd Initial Term) 85.8993 90.4874 93.4225 96.7982 99.1528
3rd 84.0572 89.0277 92.2075 95.8645 98.4154
4th 82.1936 87.5510 90.9783 94.9199 97.6694
5th 80.3083 86.0571 89.7347 93.9643 96.9147
6th 78.4009 84.5457 88.4766 92.9976 96.1511
7th 76.4713 83.0167 87.2039 92.0195 95.3787
8th 74.5192 81.4698 85.9163 91.0301 94.5972
9th 72.5444 79.9049 84.6137 90.0291 93.8067
10th 70.5464 78.3218 83.2958 89.0165 93.0069
11th 68.5252 76.7202 81.9627 87.9920 92.1978
12th 66.4804 75.0998 80.6139 86.9556 91.3792
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
YEAR THREE
1 st (Month of 64.4117 73.4606 79.2494 85.9071 90.5511
2nd Initial Term) 62.3189 71.8023 77.8690 84.8463 89.7133
3rd 60.2017 70.1246 76.4725 83.7732 88.8658
4th 58.0598 68.4274 75.0597 82.6876 88.0083
5th 55.8929 66.7103 73.6305 81.5893 87.1409
6th 53.7007 64.9732 72.1845 80.4781 86.2633
7th 51.4830 63.2159 70.7217 79.3541 85.3755
8th 49.2393 61.4380 69.2418 78.2169 84.4774
9th 46.9695 59.6394 67.7447 77.0664 83.5687
10th 44.6732 57.8198 66.2300 75.9025 82.6495
11th 42.3502 55.9790 64.6977 74.7251 81.7196
12th 40.0000 54.1167 63.1476 73.5339 80.7787
YEAR FOUR
1st (Month of 40.0000 52.2327 61.5793 72.3288 79.8270
2nd Initial Term) 40.0000 50.3267 59.9928 71.1096 78.8641
3rd 40.0000 48.3985 58.3877 69.8762 77.8900
4th 40.0000 46.4478 56.7639 68.6284 76.9075
5th 40.0000 44.4743 55.1212 67.3661 75.9045
6th 40.0000 42.4778 53.4598 66.0891 74.8989
7th 40.0000 40.4580 51.7780 64.7971 73.8785
8th 40.0000 38.4146 50.0771 63.4901 72.8462
9th 40.0000 36.3474 48.3564 62.1678 71.8019
10th 40.0000 34.2561 46.6156 60.8301 70.7454
11th 40.0000 32.1404 44.8544 59.4768 69.6765
12th 40.0000 30.0000 43.0728 58.1077 68.5952
YEAR FIVE
1st (Month of 30.0000 41.2703 56.7226 67.5013
2nd Initial Term) 30.0000 39.4468 55.3214 66.3946
3rd 30.0000 37.6021 53.9038 65.2750
4th 30.0000 35.7358 52.4697 64.1423
5th 30.0000 33.8477 51.0188 62.9965
6th 30.0000 31.9376 49.5511 61.8372
7th 30.0000 30.0053 48.0662 60.6645
8th 30.0000 28.0504 46.5639 59.4780
9th 30.0000 26.0726 45.0442 58.2777
10th 30.0000 24.0719 43.5067 57.0634
11th 30.0000 22.0477 41.9513 55.8350
12th 30.0000 20.0000 40.3777 54.5922
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
YEAR SIX
1st (Month of 20.0000 38.7858 53.3349
2nd Initial Term) 20.0000 37.1753 52.0629
3rd 20.0000 35.5460 50.7761
4th 20.0000 33.8978 49.4743
5th 20.0000 32.2302 48.1573
20.0000 30.5433 46.8249
7th 20.0000 28.8366 45.4770
8th 20.0000 27.1100 44.1134
20.0000 25.3633 42.7338
10th 20.0000 23.5962 41.3382
11th 20.0000 21.8085 39.9263
12th 20.0000 20.0000 38.4979
YEAR SEVEN
1 st (Month of 20.0000 37.0528
2nd Initial Term) 20.0000 35.5909
3rd 20.0000 34.1119
4th 20.0000 32.6157
5th 20.0000 31.1020
20.0000 29.5707
7th 20.0000 28.0214
8th 20.0000 26.4542
9th 20.0000 24.8686
10th 20.0000 23.2645
11th 20.0000 21.6417
12th 20.0000 *20.0000
* Applicable Thereafter
EQUIPMENT SCHEDULE VL-2
DATED AS OF SEPTEMBER 22,1998
TO MASTER LEASE AGREEMENT
DATED AS OF SEPTEMBER 22, 1998 (THE "MASTER LEASE")
LESSEE: CHORUM TECHNOLOGIES, INC. LESSOR: COMDISCO, INC.
Admin. Contact/Phone No.: Address for all Notices:
------------------------ -----------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(972) 238-1477Fax Attn: Venture Group
Address for Notices:
-------------------
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Central Billing Location: Rent Interval: Monthly
------------------------ -------------
same as above
Attn:
Lessee Reference No.:
(24 digits maximum)
Location of Equipment: Initial Term: 48 months
--------------------- ------------
(Number of Rent Intervals)
Lease Rate Factor: 2.392%
-----------------
Attn:
EQUIPMENT (as defined below): Advance: None
-------
Interim Rent: None
------------
Software (including maintenance fees) and tenant improvements specifically
approved by Lessor, which shall be delivered to and accepted by Lessee during
the period September 22, 1998 through September 22, 1999 ("Equipment Delivery
Period") for which Lessor receives vendor invoices approved for payment, up to
an aggregate purchase price of $370,296.73("Commitment Amount').
1. Equipment Purchase
This Schedule contemplates Lessor's acquisition of Equipment for lease to
Lessee, either by one of the first three categories listed below or by providing
Lessee with Equipment from the fourth category, in an aggregate value up to the
Commitment Amount referred to on the face of this Schedule. If the Equipment
acquired is of category (i), (ii) , (iii) below, the effectiveness of this
Schedule as it relates to those items of Equipment is contingent upon Lessee's
acknowledgment at the time Lessor acquires the Equipment that Lessee has either
received or approved the relevant purchase documentation between vendor and
Lessor for that Equipment.
(i) NEW ON-ORDER EQUIPMENT. Lessor will purchase new Equipment which is
obtained from a vendor by Lessee for its use subject to Lessor's
prior approval of the Equipment.
(ii) SALE-LEASEBACK EQUIPMENT. Any in-place Equipment installed at
Lessee's site and to which Lessee has clear title and ownership may
be considered by Lessor for inclusion under this Lease (the "Sale-
Leaseback Transaction"). Any request for a Sale-Leaseback
Transaction must be submitted to Lessor in writing (along with
accompanying evidence of Lessee's Equipment ownership satisfactory
to Lessor for all Equipment submitted) no later than October 22,
1998*. Lessor will not perform a Sale-Leaseback Transaction for any
request or accompanying Equipment ownership documents which arrive
after the date marked above by an asterisk (*). Further, any sale-
leaseback Equipment will be placed on lease subject to: (1) Lessor
prior approval of the Equipment; and (2) if approved, at Lessor's
actual net appraised Equipment value pursuant to the schedule
below:
ORIGINAL EQUIPMENT INVOICE PERCENT OF ORIGINAL MANUFACTURER'S
DATE NET EQUIPMENT COST PAID BY LESSOR
---------------------------------
Between 10/22/97-10/22/98 (360 days) 100%
(iii) USED ON-ORDER EQUIPMENT. Lessor will purchase used Equipment which
is obtained from a third party by Lessee for its use subject to
Lessor's prior approval of the Equipment and at Lessor's appraised
value for such used Equipment.
(iv) 800 NUMBER EQUIPMENT. Upon Lessee's use of Comdisco's 1-800 Direct
Service, Lessor will purchase new or used Equipment from a third
party or Lessor will supply new or used Equipment from its
inventory for use by Lessee at rates provided by Lessor.
2. Commencement Date
The Commencement Date for each item of new on-order or used on-order
Equipment will be the install date as confirmed in writing by Lessee as set
forth on the vendor invoice of which a facsimile transmission will constitute an
original document. The Commencement Date for sale-leaseback Equipment shall be
the date Lessor tenders the purchase price. The Commencement Date for 800 Number
Equipment shall be fifteen (15) days from the ship date, such ship date to be
set forth on the vendor invoice or if unavailable on the vendor invoice the ship
date will be determined by Lessor upon other supporting shipping documentation.
Lessor will summarize all approved invoices, purchase documentation and evidence
of delivery, as applicable, received in the same calendar quarter into a Summary
Equipment Schedule in the form attached to this Schedule as Exhibit 1, and the
Initial Term will begin the first day of the calendar quarter thereafter. Each
Summary Equipment Schedule will contain the Equipment location, description,
serial number(s) and cost and will incorporate the terms and conditions of the
Master Lease and this Schedule and will constitute a separate lease.
3. Miscellaneous
In consideration of Lessor financing software and tenant improvements
hereunder, Lessee agrees in addition to its last Monthly Rent Payment to remit
to Lessor an amount equal to 15% of Lessor's aggregate cost of software and
tenant improvements provided hereunder.
4. Special Terms
The terms and conditions of the Lease as they pertain to this Schedule are
hereby modified and amended as follows:
(a) Section 9, Delivery and Return of Equipment
-------------------------------------------
Delete second, third and fourth sentences in their entirety.
(b) Casualty Value Table is attached as Exhibit 2.
Master Lease: This Schedule is issued pursuant to the Lease identified on
page 1 of this Schedule. All of the terms and conditions of the Lease are
incorporated in and made a part of this Schedule as if they were expressly
set forth in this Schedule. The parties hereby reaffirm all of the terms
and conditions of the Lease (including, without limitation, the
representations and warranties set forth in Section 8) except as modified
herein by this Schedule. This Schedule may not be amended or rescinded
except by a writing signed by both parties.
CHORUM TECHNOLOGIES, INC. COMDISCO, INC.
as Lessee as Lessor
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
------------------------- ------------------------
Title: President and CEO Title: President
---------------------- ---------------------
Date: 9/23/98 Date: 9/28/98
----------------------- -----------------------
EXHIBIT 1
SUMMARY EQUIPMENT SCHEDULE
--------------------------
This Summary Equipment Schedule dated XXXX is executed pursuant to
Equipment Schedule No. X to the Master Lease Agreement dated XXXX between
Comdisco, Inc. ("Lessor") and XXXX ("Lessee"). All of the terms, conditions,
representations and warranties of the Master Lease Agreement and Equipment
Schedule No. X are incorporated herein and made a part hereof, and this Summary
Equipment Schedule constitutes a Schedule for the Equipment on the attached
invoices.
1. For Period Beginning: And Ending:
--------------------- -----------
2. Initial Term Starts on: Initial Term:
----------------------- -------------
(Number of Rent Intervals)
3. Total Summary Equipment Cost:
-----------------------------
4. Lease Rate Factor:
------------------
5. Rent:
-----
6. Acceptance Doc Type:
--------------------
EXHIBIT 2
---------
CASUALTY VALUE TABLE - MONTHLY
The Casualty Value applicable to an item of Equipment will be the acquisition
cost multiplied by the Casualty Value Percentage set forth below applicable to
that item.
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
DATE OF DELIVERY
TO INITIAL TERM
START DATE 108.0000% 108.0000% 108.0000% 108.0000% 108.0000%
YEAR ONE
1st (Month of 108.0000 108.0000 108.0000 108.0000 108.0000
2nd Initial Term) 106.4157 106.7446 106.9550 107.1970 107.3658
3rd 104.8130 105.4746 105.8979 106.3846 106.7242
4th 103.1915 104.1898 104.8284 105.5628 106.0751
5th 101.5512 102.8899 103.7464 104.7314 105.4185
6th 99.8917 101.5749 102.6518 103.8902 104.7451
7th 98.2128 100.2446 101.5444 103.0393 104.0821
8th 96.5143 98.8988 100.4241 102.1784 103.4021
9th 94.7961 97.5372 99.2908 101.3075 102.7143
10th 93.0578 96.1598 98.1442 100.4265 102.0184
11th 91.2992 94.7662 96.9842 99.5351 101.3144
12th 89.5201 93.3565 95.8107 98.6334 100.6022
YEAR TWO
1st (Month of 87.7202 91.9303 94.6236 97.7211 99.8817
2nd Initial Term) 85.8993 90.4874 93.4225 96.7982 99.1528
3rd 84.0572 89.0277 92.2075 95.8645 98.4154
4th 82.1936 87.5510 90.9783 94.9199 97.6694
5th 80.3083 86.0571 89.7347 93.9643 96.9147
6th 78.4009 84.5457 88.4766 92.9976 96.1511
7th 76.4713 83.0167 87.2039 92.0195 95.3787
8th 74.5192 81.4698 85.9163 91.0301 94.5972
9th 72.5444 79.9049 84.6137 90.0291 93.8067
10th 70.5464 78.3218 83.2958 89.0165 93.0069
11th 68.5252 76.7202 81.9627 87.9920 92.1978
12th 66.4804 75.0998 80.6139 86.9556 91.3792
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
YEAR THREE
1st (Month of 64.4117 73.4606 79.2494 85.9071 90.5511
2nd Initial Term) 62.3189 71.8023 77.8690 84.8463 89.7133
3rd 60.2017 70.1246 76.4725 83.7732 88.8658
4th 58.0598 68.4274 75.0597 82.6876 88.0083
5th 55.8929 66.7103 73.6305 81.5893 87.1409
6th 53.7007 64.9732 72.1845 80.4781 86.2633
7th 51.4830 63.2159 70.7217 79.3541 85.3755
8th 49.2393 61.4380 69.2418 78.2169 84.4774
9th 46.9695 59.6394 67.7447 77.0664 83.5687
10th 44.6732 57.8198 66.2300 75.9025 82.6495
11th 42.3502 55.9790 64.6977 74.7251 81.7196
12th 40.0000 54.1167 63.1476 73.5339 80.7787
YEAR FOUR
1 st (Month of 40.0000 52.2327 61.5793 72.3288 79.8270
2nd Initial Term) 40.0000 50.3267 59.9928 71.1096 78.8641
3rd 40.0000 48.3985 58.3877 69.8762 77.8900
4th 40.0000 46.4478 56.7639 68.6284 76.9075
5th 40.0000 44.4743 55.1212 67.3661 75.9045
6th 40.0000 42.4778 53.4598 66.0891 74.8989
7th 40.0000 40.4580 51.7780 64.7971 73.8785
8th 40.0000 38.4146 50.0771 63.4901 72.8462
9th 40.0000 36.3474 48.3564 62.1678 71.8019
10th 40.0000 34.2561 46.6156 60.8301 70.7454
11th 40.0000 32.1404 44.8544 59.4768 69.6765
12th 40.0000 30.0000 43.0728 58.1077 68.5952
YEAR FIVE
1st (Month of 30.0000 41.2703 56.7226 67.5013
2nd Initial Term) 30.0000 39.4468 55.3214 66.3946
3rd 30.0000 37.6021 53.9038 65.2750
4th 30.0000 35.7358 52.4697 64.1423
5th 30.0000 33.8477 51.0188 62.9965
6th 30.0000 31.9376 49.5511 61.8372
7th 30.0000 30.0053 48.0662 60.6645
8th 30.0000 28.0504 46.5639 59.4780
9th 30.0000 26.0726 45.0442 58.2777
10th 30.0000 24.0719 43.5067 57.0634
11th 30.0000 22.0477 41.9513 55.8350
12th 30.0000 20.0000 40.3777 54.5922
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
YEAR SIX
1st (Month of 20.0000 38.7858 53.3349
2nd Initial Term) 20.0000 37.1753 52.0629
3rd 20.0000 35.5460 50.7761
4th 20.0000 33.8978 49.4743
5th 20.0000 32.2302 48.1573
6th 20.0000 30.5433 46.8249
20.0000 28.8366 45.4770
8th 20.0000 27.1100 44.1134
9th 20.0000 25.3633 42.7338
loth 20.0000 23.5962 41.3382
11th 20.0000 21.8085 39.9263
12th 20.0000 20.0000 38.4979
YEAR SEVEN
1 st (Month of 20.0000 37.0528
2nd Initial Term) 20.0000 35.5909
3rd 20.0000 34.1119
4th 20.0000 32.6157
5th 20.0000 31.1020
6th 20.0000 29.5707
7th 20.0000 28.0214
8th 20.0000 26.4542
9th 20.0000 24.8686
10th 20.0000 23.2645
11th 20.0000 21.6417
12th 20.0000 *20.0000
* Applicable Thereafter
EQUIPMENT SCHEDULE VL-3
DATED AS OF JANUARY 22, 1999
TO MASTER LEASE AGREEMENT
DATED AS OF SEPTEMBER 22, 1998 (THE "MASTER LEASE")
LESSEE: CHORUM TECHNOLOGIES, INC. LESSOR: COMDISCO, INC.
Admin. Contact/Phone No.: Address for all Notices:
------------------------ -----------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ Attn.: Venture Group
Address for Notices:
-------------------
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇. ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Central Billing Location: Rent Interval: Monthly
------------------------ -------------
same as above
Attn.:
Lessee Reference No.:
(24 digits maximum)
Location of Equipment: Initial Term: 48 months
--------------------- ------------
same as above (Number of Rent Intervals)
Lease Rate Factor: 2.425%
-----------------
Attn.:
EQUIPMENT (as defined below): Advance: None
-------
Interim Rent: None
------------
Equipment specifically approved by Lessor, which shall be delivered to and
accepted by Lessee during the period January 22, 1999 through January 22, 2000
("Equipment Delivery Period"), for which Lessor receives vendor invoices
approved for payment, up to an aggregate purchase price of $4,600,000.00
("Commitment Amount'); excluding custom use equipment, leasehold improvements,
installation costs and delivery costs, rolling stock, special tooling, "stand-
alone" software, application software bundled into computer hardware, hand held
items, molds and fungible items.
1. Equipment Purchase
This Schedule contemplates Lessor's acquisition of Equipment for lease to
Lessee, either by one of the first three categories listed below or by providing
Lessee with Equipment from the fourth category, in an aggregate value up to the
Commitment Amount referred to on the face of this Schedule. If the Equipment
acquired is of category (i), (ii) , (iii) below, the effectiveness of this
Schedule as it relates to those items of Equipment is contingent upon Lessee's
acknowledgment at the time Lessor acquires the Equipment that Lessee has either
received or approved the relevant purchase documentation between vendor and
Lessor for that Equipment.
(i) NEW ON-ORDER EQUIPMENT. Lessor will purchase new Equipment which is
obtained from a vendor by Lessee for its use subject to Lessor's
prior approval of the Equipment.
(ii) SALE-LEASEBACK EQUIPMENT. Any in-place Equipment installed at
Lessee's site and to which Lessee has clear title and ownership may
be considered by Lessor for inclusion under this Lease (the "Sale-
Leaseback Transaction"). Any request for a Sale-Leaseback
Transaction must be submitted to Lessor in writing (along with
accompanying evidence of Lessee's Equipment ownership satisfactory
to Lessor for all Equipment submitted) no later than February 22,
1999 *. Lessor will not perform a Sale-Leaseback Transaction for
any request or accompanying Equipment ownership documents which
arrive after the date marked above by an asterisk (*). Further, any
sale-leaseback Equipment will be placed on lease subject to: (1)
Lessor prior approval of the Equipment; and (2) if approved, at
Lessor's actual net appraised Equipment value pursuant to the
schedule below:
ORIGINAL EQUIPMENT INVOICE PERCENT OF ORIGINAL MANUFACTURER'S
DATE NET EQUIPMENT COST PAID BY LESSOR
---- ---------------------------------
Between 10/24/98 - 01 /22/99 (90 days) 100%
(iii) USED ON-ORDER EQUIPMENT. Lessor will purchase used Equipment which
is obtained from a third party by Lessee for its use subject to
Lessor's prior approval of the Equipment and at Lessor's appraised
value for such used Equipment.
(iv) 800 NUMBER EQUIPMENT. Upon Lessee's use of Comdisco's 1-800 Direct
Service, Lessor will purchase new or used Equipment from a third
party or Lessor will supply new or used Equipment from its
inventory for use by Lessee at rates provided by Lessor.
2. Commencement Date
The Commencement Date for each item of new on-order or used on-order
Equipment will be the install date as confirmed in writing by Lessee as set
forth on the vendor invoice of which a facsimile transmission will constitute an
original document. The Commencement Date for sale-leaseback Equipment shall be
the date Lessor tenders the purchase price. The Commencement Date for 800 Number
Equipment shall be fifteen (15) days from the ship date, such ship date to be
set forth on the vendor invoice or if unavailable on the vendor invoice the ship
date will be determined by Lessor upon other supporting shipping documentation.
Lessor will summarize all approved invoices, purchase documentation and evidence
of delivery, as applicable, received in the same calendar month into a Summary
Equipment Schedule in the form attached to this Schedule as Exhibit 1, and the
Initial Term will begin the first day of the calendar month thereafter. Each
Summary Equipment Schedule will contain the Equipment location, description,
serial number(s) and cost and will incorporate the terms and conditions of the
Master Lease and this Schedule and will constitute a separate lease.
3. Option to Extend
So long as no Event of Default has occurred and is continuing hereunder,
and upon written notice no earlier than twelve (12) months and no later than
ninety (90) days prior to the expiration of the Initial Term of a Summary
Equipment Schedule, Lessee will have the right to extend the Initial Term of
such Summary Equipment Schedule for a period of one (1) year. In such event, the
rent to be paid during said extended period shall be mutually agreed upon and if
the parties cannot mutually agree within ninety (90) days of the expiration of
the Initial Term, then Lessee may revoke its election to extend the Initial Term
by notice given to Lessor within five (5) days thereafter. If such notice is not
given and an impasse is reached, then the Summary Equipment Schedule shall
continue in full force and effect pursuant to the existing terms and conditions
until terminated in accordance with its terms. The Summary Equipment Schedule
will continue in effect following said extended period until terminated by
either party upon not less than ninety (90) days prior written notice, which
notice shall be effective as of the date of receipt.
4. Purchase Option
So long as no Event of Default has occurred and is continuing hereunder,
and upon written notice no earlier than twelve (12) months and no later than
ninety (90) days prior to the expiration of the Initial Term or the extended
term of the applicable Summary Equipment Schedule, Lessee will have the option
at the expiration of the Initial Term or the extended term of the Summary
Equipment Schedule to purchase all, but not less than all, of the Equipment
listed therein for a purchase price not to exceed 15% of Lessor's cost hereunder
and upon terms and conditions to be mutually agreed upon by the parties
following Lessee's written notice, plus any taxes applicable at time of
purchase. Said purchase price shall be paid to Lessor on the expiration date of
the Initial Term or extended term. Title to the Equipment shall automatically
pass to Lessee upon payment in full of the purchase price but, in no event,
earlier than the expiration of the fixed Initial Term or extended term, if
applicable Notwithstanding the exercise by Lessee of this option and payment of
the purchase price, until all obligations under the applicable Summary Equipment
Schedule have been fulfilled, it is agreed and understood that Lessor shall
retain a purchase money security interest in the Equipment listed therein and
the Summary Equipment Schedule shall constitute a Security Agreement under the
Uniform Commercial Code of the state in which the Equipment is located.
If the parties are unable to agree on the purchase price or the terms and
conditions with respect to said purchase within ninety (90) days of the
expiration of the Initial Term or the renewal term, as applicable, then Lessee
may revoke its election to purchase the Equipment by notice given to Lessor
within five (5) days thereafter. If such notice is not given and an impasse is
reached, the Summary Equipment Schedule shall continue in full force and effect
pursuant to the existing terms and conditions until terminated by either party
upon not less than ninety (90) days prior written notice, which notice shall be
effective as of the date of receipt.
5. Technology Exchange Option
So long as no Event of Default has occurred and is continuing, and there is
no material adverse change in Lessee's credit, on or after the expiration of the
12th month of any Summary Equipment Schedule, Lessee shall have the option to
replace any of the Equipment subject to such summary Equipment Schedule with new
technology equipment ("New Technology Equipment") utilizing the following
guidelines:
A. Equipment being replaced with New Technology Equipment shall have an
aggregate original cost equal to or greater than $20,000 and be comprised of
full configurations of equipment.
B. This technology Exchange Option shall be limited to a maximum in the
aggregate of fifty percent (50%) of the original equipment cost and shall not
apply to software or any soft costs financed hereunder including but not limited
to tenant improvements and custom equipment.
C. The cost of the New Technology Equipment must be equal to or greater than the
original equipment cost of the replaced equipment, but in no event shall exceed
150% of the original equipment cost.
D. The remaining lease payments applicable to the equipment being replaced by
the New Technology Equipment will be discounted to present value at 6%.
The wholesale market value of the equipment being replaced will be established
by Comdisco based upon then current market conditions. Upon the return of the
replaced equipment, the wholesale price will be deducted from the present value
of the remaining
rentals and the differential will be added to the cost of the New Technology
Equipment in calculating the new rental. The lease for the New Technology
Equipment will contain terms and conditions substantially similar to those for
the replaced equipment and will have an Initial Term not less than the balance
of the remaining Initial Term for the replaced equipment.
8. Special Terms
The terms and conditions of the Lease as they pertain to this Schedule are
hereby modified and amended as follows:
(a) Casualty Value Table is attached as Exhibit 2.
Master Lease: This Schedule is issued pursuant to the Lease identified on page 1
of this Schedule. All of the terms and conditions of the Lease are incorporated
in and made a part of this Schedule as if they were expressly set forth in this
Schedule. The parties hereby reaffirm all of the terms and conditions of the
Lease (including, without limitation, the representations and warranties set
forth in Section 8) except as modified herein by this Schedule. This Schedule
may not be amended or rescinded except by a writing signed by both parties.
CHORUM TECHNOLOGIES, INC. COMDISCO, INC.
as Lessee as Lessor
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------- ---------------------------
Title: President and CEO Title: Senior Vice President
----------------------- ------------------------
Date: 11/25/98 Date: 11/28/98
------------------------ -------------------------
EXHIBIT 1
SUMMARY EQUIPMENT SCHEDULE
--------------------------
This Summary Equipment Schedule dated XXXX is executed pursuant to
Equipment Schedule No. X to the Master Lease Agreement dated XXXX between
Comdisco, Inc. ("Lessor") and XXXX ("Lessee"). All of the terms, conditions,
representations and warranties of the Master Lease Agreement and Equipment
Schedule No. X are incorporated herein and made a part hereof, and this Summary
Equipment Schedule constitutes a Schedule for the Equipment on the attached
invoices.
1. For Period Beginning: And Ending:
--------------------- -----------
2. Initial Term Starts on: Initial Term:
----------------------- -------------
(Number of Rent Intervals)
3. Total Summary Equipment Cost:
-----------------------------
4. Lease Rate Factor:
------------------
5. Rent:
-----
6. Acceptance Doc Type:
--------------------
EQUIPMENT SCHEDULE VL-4
DATED AS OF JANUARY 22, 1999
TO MASTER LEASE AGREEMENT
DATED AS OF SEPTEMBER 22, 1998 (THE "MASTER LEASE")
LESSEE: CHORUM TECHNOLOGIES, INC. LESSOR: COMDISCO, INC.
Admin. Contact/Phone No.: Address for all Notices:
------------------------ -----------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(972) 238-1477Fax Attn.: Venture Group
Address for Notices:
-------------------
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Central Billing Location: Rent Interval: Monthly
------------------------ -------------
same as above
Attn.:
Lessee Reference No.: ___________
(24 digits maximum)
Location of Equipment:
---------------------
Initial Term: 36 months
------------
(Number of Rent Intervals)
Lease Rate Factor: 3.145%
-----------------
Attn.:
EQUIPMENT (as defined below):
Advance: None
-------
Interim Rent: None
------------
Software(including maintenance fees) and tenant improvements specifically
approved by Lessor, which shall be delivered to and accepted by Lessee during
the period January 22, 1999 through January 22, 2000 ("Equipment Delivery
Period") for which Lessor receives vendor invoices approved for payment, up to
an aggregate purchase price of $400,000.00("Commitment Amount'), excluding
custom use equipment, installation costs and delivery costs, rolling stock,
special tooling, hand held items, molds and fungible items.
1. Equipment Purchase
This Schedule contemplates Lessor's acquisition of Equipment for lease to
Lessee, either by one of the first three categories listed below or by providing
Lessee with Equipment from the fourth category, in an aggregate value up to the
Commitment Amount referred to on the face of this Schedule. If the Equipment
acquired is of category (i), (ii) , (iii) below, the effectiveness of this
Schedule as it relates to those items of Equipment is contingent upon Lessee's
acknowledgment at the time Lessor acquires the Equipment that Lessee has either
received or approved the relevant purchase documentation between vendor and
Lessor for that Equipment.
(i) NEW ON-ORDER EQUIPMENT. Lessor will purchase new Equipment which is
obtained from a vendor by Lessee for its use subject to Lessor's
prior approval of the Equipment.
(ii) SALE-LEASEBACK EQUIPMENT. Any in-place Equipment installed at
Lessee's site and to which Lessee has clear title and ownership may
be considered by Lessor for inclusion under this Lease (the "Sale-
Leaseback Transaction"). Any request for a Sale-Leaseback
Transaction must be submitted to Lessor in writing (along with
accompanying evidence of Lessee's Equipment ownership satisfactory
to Lessor for all Equipment submitted) no later than February 22,
1999 *. Lessor will not perform a Sale-Leaseback Transaction for
any request or accompanying Equipment ownership documents which
arrive after the date marked above by an asterisk (*).
Further, any sale-leaseback Equipment will be placed on lease
subject to: (1) Lessor prior approval of the Equipment; and (2) if
approved, at Lessor's actual net appraised Equipment value pursuant
to the schedule below:
ORIGINAL EQUIPMENT INVOICE PERCENT OF ORIGINAL MANUFACTURER'S
DATE NET EQUIPMENT COST PAID BY LESSOR
---- ---------------------------------
Between 10/24/98 - 01 /22/99 (90 days) 100%
(iii) USED ON-ORDER EQUIPMENT. Lessor will purchase used Equipment which
is obtained from a third party by Lessee for its use subject to
Lessor's prior approval of the Equipment and at Lessor's appraised
value for such used Equipment.
(iv) 800 NUMBER EQUIPMENT. Upon Lessee's use of Comdisco's 1-800 Direct
Service, Lessor will purchase new or used Equipment from a third
party or Lessor will supply new or used Equipment from its
inventory for use by Lessee at rates provided by Lessor.
2. Commencement Date
The Commencement Date for each item of new on-order or used on-order
Equipment will be the install date as confirmed in writing by Lessee as set
forth on the vendor invoice of which a facsimile transmission will constitute an
original document. The Commencement Date for sale-leaseback Equipment shall be
the date Lessor tenders the purchase price. The Commencement Date for 800 Number
Equipment shall be fifteen (15) days from the ship date, such ship date to be
set forth on the vendor invoice or if unavailable on the vendor invoice the ship
date will be determined by Lessor upon other supporting shipping documentation.
Lessor will summarize all approved invoices, purchase documentation and evidence
of delivery, as applicable, received in the same calendar month into a Summary
Equipment Schedule in the form attached to this Schedule as Exhibit 1, and the
Initial Term will begin the first day of the calendar month thereafter. Each
Summary Equipment Schedule will contain the Equipment location, description,
serial number(s) and cost and will incorporate the terms and conditions of the
Master Lease and this Schedule and will constitute a separate lease.
3. Miscellaneous
In consideration of Lessor financing software and tenant improvements
hereunder, Lessee agrees in addition to its last Monthly Rent Payment to remit
to Lessor an amount equal to 15% of Lessor's aggregate cost of software and
tenant improvements provided hereunder.
4. Special Terms
The terms and conditions of the Lease as they pertain to this Schedule are
hereby modified and amended as follows:
(a) Section 9, Delivery and Return of Equipment
-------------------------------------------
Delete second, third and fourth sentences in their entirety.
(b) Casualty Value Table is attached as Exhibit 2.
Master Lease: This Schedule is issued pursuant to the Lease identified on page 1
of this Schedule. All of the terms and conditions of the Lease are incorporated
in and made a part of this Schedule as if they were expressly set forth in this
Schedule. The parties hereby reaffirm all of the terms and conditions of the
Lease (including, without limitation, the representations and warranties set
forth in Section 8) except as modified herein by this Schedule. This Schedule
may not be amended or rescinded except by a writing signed by both parties.
CHORUM TECHNOLOGIES, INC. COMDISCO, INC.
as Lessee as Lessor
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------ ---------------------------
Title: President and CEO Title: Senior Vice President
--------------------- ------------------------
Date: 1/25/98 Date: 1/28/98
---------------------- -------------------------
EXHIBIT 1
SUMMARY EQUIPMENT SCHEDULE
--------------------------
This Summary Equipment Schedule dated XXXX is executed pursuant to
Equipment Schedule No. X to the Master Lease Agreement dated XXXX between
Comdisco, Inc. ("Lessor") and XXXX ("Lessee"). All of the terms, conditions,
representations and warranties of the Master Lease Agreement and Equipment
Schedule No. X are incorporated herein and made a part hereof, and this Summary
Equipment Schedule constitutes a Schedule for the Equipment on the attached
invoices.
1. For Period Beginning: And Ending:
--------------------- -----------
2. Initial Term Starts on: Initial Term:
----------------------- -------------
(Number of Rent Intervals)
3. Total Summary Equipment Cost:
-----------------------------
4. Lease Rate Factor:
------------------
5. Rent:
-----
6. Acceptance Doc Type:
--------------------
EQUIPMENT SCHEDULE VL-5
DATED AS OF MARCH 1, 2000
TO MASTER LEASE AGREEMENT
DATED AS OF SEPTEMBER 22, 1998 (THE "MASTER LEASE")
LESSEE: CHORUM TECHNOLOGIES, INC. LESSOR: COMDISCO, INC.
Admin. Contact/Phone No.: Address for all Notices:
------------------------ -----------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇ Attn.: Venture Group
Address for Notices:
-------------------
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇. ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Central Billing Location: Rent Interval: Monthly
------------------------ -------------
same as above
Attn.:
Lessee Reference No.:
(24 digits maximum)
Location of Equipment: Initial Term: 48 months
--------------------- ------------
1) same as above (Number of Rent Intervals)
2) ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Lease Rate Factor: 2.436%
-----------------
Attn.:
EQUIPMENT (as defined below): Advance: NONE
Interim Rent: NONE
Equipment specifically approved by Lessor, which shall be delivered to and
accepted by Lessee during the period March 1, 2000 through September 1, 2001
("Equipment Delivery Period"), for which Lessor receives vendor invoices
approved for payment, up to an aggregate purchase price of $6,400,000.00
("Commitment Amount'); excluding custom use equipment, leasehold improvements,
installation costs and delivery costs, rolling stock, special tooling, "stand-
alone" software, application software bundled into computer hardware, hand held
items, molds and fungible items.
1. Equipment Purchase
This Schedule contemplates Lessor's acquisition of Equipment for lease to
Lessee, either by one of the first three categories listed below or by providing
Lessee with Equipment from the fourth category, in an aggregate value up to the
Commitment Amount referred to on the face of this Schedule. If the Equipment
acquired is of category (i), (ii) , (iii) below, the effectiveness of this
Schedule as it relates to those items of Equipment is contingent upon Lessee's
acknowledgment at the time Lessor acquires the Equipment that Lessee has either
received or approved the relevant purchase documentation between vendor and
Lessor for that Equipment.
(i) NEW ON-ORDER EQUIPMENT. Lessor will purchase new Equipment which is
obtained from a vendor by Lessee for its use subject to Lessor's
prior approval of the Equipment.
(ii) SALE-LEASEBACK EQUIPMENT. Any in-place Equipment installed at
Lessee's site and to which Lessee has clear title and ownership may
be considered by Lessor for inclusion under this Lease (the "Sale-
Leaseback Transaction"). Any request for a Sale-Leaseback
Transaction must be submitted to Lessor in writing (along with
accompanying evidence of Lessee's Equipment ownership satisfactory
to Lessor for all Equipment submitted) no later than April 1,
2000*. Lessor will not perform a Sale-Leaseback Transaction for any
request or accompanying Equipment ownership documents which arrive
after the date marked above by an asterisk (*). Further, any sale
leaseback Equipment will be placed on lease subject to: (1) Lessor
prior approval of the Equipment; and (2) if approved, at Lessor's
actual net appraised Equipment value pursuant to the schedule
below:
ORIGINAL EQUIPMENT INVOICE PERCENT OF ORIGINAL MANUFACTURER'S
DATE NET EQUIPMENT COST PAID BY LESSOR
---- ---------------------------------
Between 12/03/99 - 04/01/00 (120 days) 100%
(iii) USED ON-ORDER EQUIPMENT. Lessor will purchase used Equipment which
is obtained from a third party by Lessee for its use subject to
Lessor's prior approval of the Equipment and at Lessor's appraised
value for such used Equipment.
(iv) 800 NUMBER EQUIPMENT. Upon Lessee's use of Comdisco's 1-800 Direct
Service, Lessor will purchase new or used Equipment from a third
party or Lessor will supply new or used Equipment from its
inventory for use by Lessee at rates provided by Lessor.
2. Commencement Date
The Commencement Date for each item of new on-order or used on-order
Equipment will be the install date as confirmed in writing by Lessee as set
forth on the vendor invoice of which a facsimile transmission will constitute an
original document. The Commencement Date for sale-leaseback Equipment shall be
the date Lessor tenders the purchase price. The Commencement Date for 800 Number
Equipment shall be fifteen (15) days from the ship date, such ship date to be
set forth on the vendor invoice or if unavailable on the vendor invoice the ship
date will be determined by Lessor upon other supporting shipping documentation.
Lessor will summarize all approved invoices, purchase documentation and evidence
of delivery, as applicable, received in the same calendar month into a Summary
Equipment Schedule in the form attached to this Schedule as Exhibit 1, and the
Initial Term will begin the first day of the calendar month thereafter. Each
Summary Equipment Schedule will contain the Equipment location, description,
serial number(s) and cost and will incorporate the terms and conditions of the
Master Lease and this Schedule and will constitute a separate lease.
3. Option to Extend
So long as no Event of Default has occurred and is continuing hereunder,
and upon written notice no earlier than twelve (12) months and no later than
ninety (90) days prior to the expiration of the Initial Term of a Summary
Equipment Schedule, Lessee will have the right to extend the Initial Term of
such Summary Equipment Schedule for a period of one (1) year. In such event, the
rent to be paid during said extended period shall be mutually agreed upon and if
the parties cannot mutually agree within ninety (90) days of the expiration of
the Initial Term, then Lessee may revoke its election to extend the Initial Term
by notice given to Lessor within five (5) days thereafter. If such notice is not
given and an impasse is reached, then the Summary Equipment Schedule shall
continue in full force and effect pursuant to the existing terms and conditions
until terminated in accordance with its terms. The Summary Equipment Schedule
will continue in effect following said extended period until terminated by
either party upon not less than ninety (90) days prior written notice, which
notice shall be effective as of the date of receipt.
4. Purchase Option
So long as no Event of Default has occurred and is continuing hereunder,
and upon written notice no earlier than twelve (12) months and no later than
ninety (90) days prior to the expiration of the Initial Term or the extended
term of the applicable Summary Equipment Schedule, Lessee will have the option
at the expiration of the Initial Term or the extended term of the Summary
Equipment Schedule to purchase all, but not less than all, of the Equipment
listed therein for a purchase price not to exceed 15% of Lessor's cost hereunder
and upon terms and conditions to be mutually agreed upon by the parties
following Lessee's written notice, plus any taxes applicable at time of
purchase. Said purchase price shall be paid to Lessor on the expiration date of
the Initial Term or extended term. Title to the Equipment shall automatically
pass to Lessee upon payment in full of the purchase price but, in no event,
earlier than the expiration of the fixed Initial Term or extended term, if
applicable Notwithstanding the exercise by Lessee of this option and payment of
the purchase price, until all obligations under the applicable Summary Equipment
Schedule have been fulfilled, it is agreed and understood that Lessor shall
retain a purchase money security interest in the Equipment listed therein and
the Summary Equipment Schedule shall constitute a Security Agreement under the
Uniform Commercial Code of the state in which the Equipment is located.
If the parties are unable to agree on the purchase price or the terms and
conditions with respect to said purchase within ninety (90) days of the
expiration of the Initial Term or the renewal term, as applicable, then Lessee
may revoke its election to purchase the Equipment by notice given to Lessor
within five (5) days thereafter. If such notice is not given and an impasse is
reached, the Summary Equipment Schedule shall continue in full force and effect
pursuant to the existing terms and conditions until terminated by either party
upon not less than ninety (90) days prior written notice, which notice shall be
effective as of the date of receipt.
5. Technology Exchange Option
So long as no Event of Default has occurred and is continuing, and there is
no material adverse change in Lessee's credit, on or after the expiration of the
12th month of any Summary Equipment Schedule, Lessee shall have the option to
replace any of the Equipment subject to such summary Equipment Schedule with new
technology equipment ("New Technology Equipment") utilizing the following
guidelines:
A. Equipment being replaced with New Technology Equipment shall have an
aggregate original cost equal to or greater than $20,000 and be comprised of
full configurations of equipment.
B. This technology Exchange Option shall be limited to a maximum in the
aggregate of fifty percent (50%) of the original equipment cost and shall not
apply to software or any soft costs financed hereunder including but not limited
to tenant improvements and custom equipment.
C. The cost of the New Technology Equipment must be equal to or greater than
the original equipment cost of the replaced equipment, but in no event shall
exceed 150% of the original equipment cost.
D. The remaining lease payments applicable to the equipment being replaced by
the New Technology Equipment will be discounted to present value at 6%.
The wholesale market value of the equipment being replaced will be established
by Comdisco based upon then current market conditions. Upon the return of the
replaced equipment, the wholesale price will be deducted from the present value
of the remaining
rentals and the differential will be added to the cost of the New Technology
Equipment in calculating the new rental. The lease for the New Technology
Equipment will contain terms and conditions substantially similar to those for
the replaced equipment and will have an Initial Term not less than the balance
of the remaining Initial Term for the replaced equipment.
8. Special Terms
The terms and conditions of the Lease as they pertain to this Schedule are
hereby modified and amended as follows:
(a) Casualty Value Table is attached as Exhibit 2.
Master Lease: This Schedule is issued pursuant to the Lease identified on page 1
of this Schedule. All of the terms and conditions of the Lease are incorporated
in and made a part of this Schedule as if they were expressly set forth in this
Schedule. The parties hereby reaffirm all of the terms and conditions of the
Lease (including, without limitation, the representations and warranties set
forth in Section 8) except as modified herein by this Schedule. This Schedule
may not be amended or rescinded except by a writing signed by both parties.
CHORUM TECHNOLOGIES, INC. COMDISCO, INC.
as Lessee as Lessor
By: /s/ ▇▇▇▇ ▇▇▇▇▇ By:
--------------------------- ---------------------------
Title: CFO Title:
------------------------ ------------------------
Date: 3/2/00 Date:
------------------------- -------------------------
EXHIBIT 1
SUMMARY EQUIPMENT SCHEDULE
--------------------------
This Summary Equipment Schedule dated XXXX is executed pursuant to
Equipment Schedule No. X to the Master Lease Agreement dated XXXX between
Comdisco, Inc. ("Lessor") and XXXX ("Lessee"). All of the terms, conditions,
representations and warranties of the Master Lease Agreement and Equipment
Schedule No. X are incorporated herein and made a part hereof, and this Summary
Equipment Schedule constitutes a Schedule for the Equipment on the attached
invoices.
1. For Period Beginning: And Ending:
--------------------- -----------
2. Initial Term Starts on: Initial Term:
----------------------- -------------
(Number of Rent Intervals)
3. Total Summary Equipment Cost:
-----------------------------
4. Lease Rate Factor:
------------------
5. Rent:
-----
6. Acceptance Doc Type:
--------------------
EXHIBIT 2
---------
CASUALTY VALUE TABLE - MONTHLY
The Casualty Value applicable to an item of Equipment will be the acquisition
cost multiplied by the Casualty Value Percentage set forth below applicable to
that item.
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
DATE OF DELIVERY
TO INITIAL TERM
START DATE 108.0000% 108.0000% 108.0000% 108.0000% 108.0000%
YEAR ONE
1st (Month of 108.0000 108.0000 108.0000 108.0000 108.0000
2nd Initial Term) 106.4157 106.7446 106.9550 107.1970 107.3658
3rd 104.8130 105.4746 105.8979 106.3846 106.7242
4th 103.1915 104.1898 104.8284 105.5628 106.0751
5th 101.5512 102.8899 103.7464 104.7314 105.4185
6th 99.8917 101.5749 102.6518 103.8902 104.7451
7th 98.2128 100.2446 101.5444 103.0393 104.0821
8th 96.5143 98.8988 100.4241 102.1784 103.4021
9th 94.7961 97.5372 99.2908 101.3075 102.7143
10th 93.0578 96.1598 98.1442 100.4265 102.0184
11th 91.2992 94.7662 96.9842 99.5351 101.3144
12th 89.5201 93.3565 95.8107 98.6334 100.6022
YEAR TWO
1 st (Month of 87.7202 91.9303 94.6236 97.7211 99.8817
2nd Initial Term) 85.8993 90.4874 93.4225 96.7982 99.1528
3rd 84.0572 89.0277 92.2075 95.8645 98.4154
4th 82.1936 87.5510 90.9783 94.9199 97.6694
5th 80.3083 86.0571 89.7347 93.9643 96.9147
6th 78.4009 84.5457 88.4766 92.9976 96.1511
7th 76.4713 83.0167 87.2039 92.0195 95.3787
8th 74.5192 81.4698 85.9163 91.0301 94.5972
9th 72.5444 79.9049 84.6137 90.0291 93.8067
10th 70.5464 78.3218 83.2958 89.0165 93.0069
11th 68.5252 76.7202 81.9627 87.9920 92.1978
12th 66.4804 75.0998 80.6139 86.9556 91.3792
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
YEAR THREE
1st (Month of 64.4117 73.4606 79.2494 85.9071 90.5511
2nd Initial Term) 62.3189 71.8023 77.8690 84.8463 89.7133
3rd 60.2017 70.1246 76.4725 83.7732 88.8658
4th 58.0598 68.4274 75.0597 82.6876 88.0083
5th 55.8929 66.7103 73.6305 81.5893 87.1409
6th 53.7007 64.9732 72.1845 80.4781 86.2633
7th 51.4830 63.2159 70.7217 79.3541 85.3755
8th 49.2393 61.4380 69.2418 78.2169 84.4774
9th 46.9695 59.6394 67.7447 77.0664 83.5687
10th 44.6732 57.8198 66.2300 75.9025 82.6495
11th 42.3502 55.9790 64.6977 74.7251 81.7196
12th 40.0000 54.1167 63.1476 73.5339 80.7787
YEAR FOUR
1st (Month of 40.0000 52.2327 61.5793 72.3288 79.8270
2nd Initial Term) 40.0000 50.3267 59.9928 71.1096 78.8641
3rd 40.0000 48.3985 58.3877 69.8762 77.8900
4th 40.0000 46.4478 56.7639 68.6284 76.9075
5th 40.0000 44.4743 55.1212 67.3661 75.9045
6th 40.0000 42.4778 53.4598 66.0891 74.8989
7th 40.0000 40.4580 51.7780 64.7971 73.8785
8th 40.0000 38.4146 50.0771 63.4901 72.8462
9th 40.0000 36.3474 48.3564 62.1678 71.8019
10th 40.0000 34.2561 46.6156 60.8301 70.7454
11th 40.0000 32.1404 44.8544 59.4768 69.6765
12th 40.0000 30.0000 43.0728 58.1077 68.5952
YEAR FIVE
1st (Month of 30.0000 41.2703 56.7226 67.5013
2nd Initial Term) 30.0000 39.4468 55.3214 66.3946
3rd 30.0000 37.6021 53.9038 65.2750
4th 30.0000 35.7358 52.4697 64.1423
5th 30.0000 33.8477 51.0188 62.9965
6th 30.0000 31.9376 49.5511 61.8372
7th 30.0000 30.0053 48.0662 60.6645
8th 30.0000 28.0504 46.5639 59.4780
9th 30.0000 26.0726 45.0442 58.2777
10th 30.0000 24.0719 43.5067 57.0634
11th 30.0000 22.0477 41.9513 55.8350
12th 30.0000 20.0000 40.3777 54.5922
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
YEAR SIX
1st (Month of 20.0000 38.7858 53.3349
2nd Initial Term) 20.0000 37.1753 52.0629
3rd 20.0000 35.5460 50.7761
4th 20.0000 33.8978 49.4743
5th 20.0000 32.2302 48.1573
6th 20.0000 30.5433 46.8249
7th 20.0000 28.8366 45.4770
8th 20.0000 27.1100 44.1134
9th 20.0000 25.3633 42.7338
10th 20.0000 23.5962 41.3382
11th 20.0000 21.8085 39.9263
12th 20.0000 20.0000 38.4979
YEAR SEVEN
1st (Month of 20.0000 37.0528
2nd Initial Term) 20.0000 35.5909
3rd 20.0000 34.1119
4th 20.0000 32.6157
5th 20.0000 31.1020
6th 20.0000 29.5707
7th 20.0000 28.0214
8th 20.0000 26.4542
9th 20.0000 24.8686
10th 20.0000 23.2645
11th 20.0000 21.6417
12th 20.0000 *20.0000
* Applicable Thereafter
EQUIPMENT SCHEDULE VL-6
DATED AS OF MARCH 1, 2000
TO MASTER LEASE AGREEMENT
DATED AS OF SEPTEMBER 22, 1998 (THE "MASTER LEASE")
LESSEE: CHORUM TECHNOLOGIES, INC. LESSOR: COMDISCO, INC.
Admin. Contact/Phone No.: Address for all Notices:
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▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇ Attn.: Venture Group
Address for Notices:
-------------------
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Central Billing Location: Rent Interval: Monthly
------------------------ -------------
same as above
Attn.:
Lessee Reference No.: _____________
(24 digits maximum)
Location of Equipment: Initial Term: 36 months
---------------------- ------------
1) Same as above (Number of Rent Intervals)
2) ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Lease Rate Factor: 3.135%
-----------------
Attn.:
EQUIPMENT (as defined below): Advance: NONE
-------
Interim Rent: NONE
------------
Software, installation costs, maintenance fee, and tenant improvements
specifically approved by Lessor, which shall be delivered to and accepted by
Lessee during the period March 1, 2000 through September 1, 2001 ("Equipment
Delivery Period") for which Lessor receives vendor invoices approved for
payment, up to an aggregate purchase price of $1,600,000.00("Commitment
Amount'), excluding custom use equipment, delivery costs, rolling stock, special
tooling, hand held items, molds and fungible items.
1. Equipment Purchase
This Schedule contemplates Lessor's acquisition of Equipment for lease to
Lessee, either by one of the first three categories listed below or by providing
Lessee with Equipment from the fourth category, in an aggregate value up to the
Commitment Amount referred to on the face of this Schedule. If the Equipment
acquired is of category (i), (ii) , (iii) below, the effectiveness of this
Schedule as it relates to those items of Equipment is contingent upon Lessee's
acknowledgment at the time Lessor acquires the Equipment that Lessee has either
received or approved the relevant purchase documentation between vendor and
Lessor for that Equipment.
(i) NEW ON-ORDER EQUIPMENT. Lessor will purchase new Equipment which is
obtained from a vendor by Lessee for its use subject to Lessor's
prior approval of the Equipment.
(ii) SALE-LEASEBACK EQUIPMENT. Any in-place Equipment installed at
Lessee's site and to which Lessee has clear title and ownership may
be considered by Lessor for inclusion under this Lease (the "Sale-
Leaseback Transaction"). Any request for a Sale-Leaseback
Transaction must be submitted to Lessor in writing (along with
accompanying evidence of Lessee's Equipment ownership satisfactory
to Lessor for all Equipment submitted) no later than April 1,
2000*. Lessor will not perform a Sale-Leaseback Transaction for any
request or accompanying Equipment ownership documents which arrive
after the date marked above by an asterisk (*). Further, any sale-
leaseback Equipment will be placed on lease subject to: (1) Lessor
prior approval of the Equipment; and (2) if approved, at Lessor's
actual net appraised Equipment value pursuant to the schedule
below:
ORIGINAL EQUIPMENT INVOICE PERCENT OF ORIGINAL MANUFACTURER'S
DATE NET EQUIPMENT COST PAID BY LESSOR
---- ---------------------------------
Between 12/03/99 - 04/01/00 (120 days) 100%
(iii) USED ON-ORDER EQUIPMENT. Lessor will purchase used Equipment which
is obtained from a third party by Lessee for its use subject to
Lessor's prior approval of the Equipment and at Lessor's appraised
value for such used Equipment.
(iv) 800 NUMBER EQUIPMENT. Upon Lessee's use of Comdisco's 1-800 Direct
Service, Lessor will purchase new or used Equipment from a third
party or Lessor will supply new or used Equipment from its
inventory for use by Lessee at rates provided by Lessor.
2. Commencement Date
The Commencement Date for each item of new on-order or used on-order
Equipment will be the install date as confirmed in writing by Lessee as set
forth on the vendor invoice of which a facsimile transmission will constitute an
original document. The Commencement Date for sale-leaseback Equipment shall be
the date Lessor tenders the purchase price. The Commencement Date for 800 Number
Equipment shall be fifteen (15) days from the ship date, such ship date to be
set forth on the vendor invoice or if unavailable on the vendor invoice the ship
date will be determined by Lessor upon other supporting shipping documentation.
Lessor will summarize all approved invoices, purchase documentation and evidence
of delivery, as applicable, received in the same calendar month into a Summary
Equipment Schedule in the form attached to this Schedule as Exhibit 1, and the
Initial Term will begin the first day of the calendar month thereafter. Each
Summary Equipment Schedule will contain the Equipment location, description,
serial number(s) and cost and will incorporate the terms and conditions of the
Master Lease and this Schedule and will constitute a separate lease.
3. Miscellaneous
In consideration of Lessor financing software, installation costs,
maintenance fees, and tenant improvements hereunder, Lessee agrees in addition
to its last Monthly Rent Payment to remit to Lessor an amount equal to 12.5% of
Lessor's aggregate cost of software, installation costs, maintenance fees, and
tenant improvements provided hereunder.
4. Special Terms
The terms and conditions of the Lease as they pertain to this Schedule are
hereby modified and amended as follows:
(a) Section 9, Delivery and Return of Equipment
-------------------------------------------
Delete second, third and fourth sentences in their entirety.
(b) Casualty Value Table is attached as Exhibit
Master Lease: This Schedule is issued pursuant to the Lease identified on page 1
of this Schedule. All of the terms and conditions of the Lease are incorporated
in and made a part of this Schedule as if they were expressly set forth in this
Schedule. The parties hereby reaffirm all of the terms and conditions of the
Lease (including, without limitation, the representations and warranties set
forth in Section 8) except as modified herein by this Schedule. This Schedule
may not be amended or rescinded except by a writing signed by both parties.
CHORUM TECHNOLOGIES, INC. COMDISCO, INC.
as Lessee as Lessor
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ By:
--------------------------- ---------------------------
Title: Title:
------------------------ ------------------------
Date: Date:
------------------------- -------------------------
EXHIBIT 1
SUMMARY EQUIPMENT SCHEDULE
--------------------------
This Summary Equipment Schedule dated XXXX is executed pursuant to
Equipment Schedule No. X to the Master Lease Agreement dated XXXX between
Comdisco, Inc. ("Lessor") and XXXX ("Lessee"). All of the terms, conditions,
representations and warranties of the Master Lease Agreement and Equipment
Schedule No. X are incorporated herein and made a part hereof, and this Summary
Equipment Schedule constitutes a Schedule for the Equipment on the attached
invoices.
1. For Period Beginning: And Ending:
--------------------- -----------
2. Initial Term Starts on: Initial Term:
----------------------- -------------
(Number of Rent Intervals)
3. Total Summary Equipment Cost:
-----------------------------
4. Lease Rate Factor:
------------------
5. Rent:
-----
6. Acceptance Doc Type:
--------------------
EXHIBIT 2
---------
CASUALTY VALUE TABLE - MONTHLY
The Casualty Value applicable to an item of Equipment will be the acquisition
cost multiplied by the Casualty Value Percentage set forth below applicable to
that item.
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
DATE OF DELIVERY
TO INITIAL TERM
START DATE 108.0000% 108.0000% 108.0000% 108.0000% 108.0000%
YEAR ONE
1st (Month of 108.0000 108.0000 108.0000 108.0000 108.0000
2nd Initial Term) 106.4157 106.7446 106.9550 107.1970 107.3658
3rd 104.8130 105.4746 105.8979 106.3846 106.7242
4th 103.1915 104.1898 104.8284 105.5628 106.0751
5th 101.5512 102.8899 103.7464 104.7314 105.4185
6th 99.8917 101.5749 102.6518 103.8902 104.7451
7th 98.2128 100.2446 101.5444 103.0393 104.0821
8th 96.5143 98.8988 100.4241 102.1784 103.4021
9th 94.7961 97.5372 99.2908 101.3075 102.7143
10th 93.0578 96.1598 98.1442 100.4265 102.0184
11th 91.2992 94.7662 96.9842 99.5351 101.3144
12th 89.5201 93.3565 95.8107 98.6334 100.6022
YEAR TWO
1st (Month of 87.7202 91.9303 94.6236 97.7211 99.8817
2nd Initial Term) 85.8993 90.4874 93.4225 96.7982 99.1528
3rd 84.0572 89.0277 92.2075 95.8645 98.4154
4th 82.1936 87.5510 90.9783 94.9199 97.6694
5th 80.3083 86.0571 89.7347 93.9643 96.9147
6th 78.4009 84.5457 88.4766 92.9976 96.1511
7th 76.4713 83.0167 87.2039 92.0195 95.3787
8th 74.5192 81.4698 85.9163 91.0301 94.5972
9th 72.5444 79.9049 84.6137 90.0291 93.8067
10th 70.5464 78.3218 83.2958 89.0165 93.0069
11th 68.5252 76.7202 81.9627 87.9920 92.1978
12th 66.4804 75.0998 80.6139 86.9556 91.3792
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
YEAR THREE
1st (Month of 64.4117 73.4606 79.2494 85.9071 90.5511
2nd Initial Term) 62.3189 71.8023 77.8690 84.8463 89.7133
3rd 60.2017 70.1246 76.4725 83.7732 88.8658
4th 58.0598 68.4274 75.0597 82.6876 88.0083
5th 55.8929 66.7103 73.6305 81.5893 87.1409
6th 53.7007 64.9732 72.1845 80.4781 86.2633
7th 51.4830 63.2159 70.7217 79.3541 85.3755
8th 49.2393 61.4380 69.2418 78.2169 84.4774
9th 46.9695 59.6394 67.7447 77.0664 83.5687
10th 44.6732 57.8198 66.2300 75.9025 82.6495
11th 42.3502 55.9790 64.6977 74.7251 81.7196
12th 40.0000 54.1167 63.1476 73.5339 80.7787
YEAR FOUR
1st (Month of 40.0000 52.2327 61.5793 72.3288 79.8270
2nd Initial Term) 40.0000 50.3267 59.9928 71.1096 78.8641
3rd 40.0000 48.3985 58.3877 69.8762 77.8900
4th 40.0000 46.4478 56.7639 68.6284 76.9075
5th 40.0000 44.4743 55.1212 67.3661 75.9045
6th 40.0000 42.4778 53.4598 66.0891 74.8989
7th 40.0000 40.4580 51.7780 64.7971 73.8785
8th 40.0000 38.4146 50.0771 63.4901 72.8462
9th 40.0000 36.3474 48.3564 62.1678 71.8019
10th 40.0000 34.2561 46.6156 60.8301 70.7454
11th 40.0000 32.1404 44.8544 59.4768 69.6765
12th 40.0000 30.0000 43.0728 58.1077 68.5952
YEAR FIVE
1st (Month of 30.0000 41.2703 56.7226 67.5013
2nd Initial Term) 30.0000 39.4468 55.3214 66.3946
3rd 30.0000 37.6021 53.9038 65.2750
4th 30.0000 35.7358 52.4697 64.1423
5th 30.0000 33.8477 51.0188 62.9965
6th 30.0000 31.9376 49.5511 61.8372
7th 30.0000 30.0053 48.0662 60.6645
8th 30.0000 28.0504 46.5639 59.4780
9th 30.0000 26.0726 45.0442 58.2777
10th 30.0000 24.0719 43.5067 57.0634
11th 30.0000 22.0477 41.9513 55.8350
12th 30.0000 20.0000 40.3777 54.5922
------------------------------------------------------------------------------------------
83 Months
1-47 Months 48-59 Months 60-71 Months 72-83 Months and beyond
Initial Term Initial Term Initial Term Initial Term Initial Term
------------------------------------------------------------------------------------------
YEAR SIX
1st (Month of 20.0000 38.7858 53.3349
2nd Initial Term) 20.0000 37.1753 52.0629
3rd 20.0000 35.5460 50.7761
4th 20.0000 33.8978 49.4743
5th 20.0000 32.2302 48.1573
6th 20.0000 30.5433 46.8249
7th 20.0000 28.8366 45.4770
8th 20.0000 27.1100 44.1134
9th 20.0000 25.3633 42.7338
10th 20.0000 23.5962 41.3382
11th 20.0000 21.8085 39.9263
12th 20.0000 20.0000 38.4979
YEAR SEVEN
1st (Month of 20.0000 37.0528
2nd Initial Term) 20.0000 35.5909
3rd 20.0000 34.1119
4th 20.0000 32.6157
5th 20.0000 31.1020
6th 20.0000 29.5707
7th 20.0000 28.0214
8th 20.0000 26.4542
9th 20.0000 24.8686
10th 20.0000 23.2645
11th 20.0000 21.6417
12th 20.0000 *20.0000
* Applicable Thereafter
EXHIBIT B
CHORUM TECHNOLOGIES INC.
Schedule of Fixed Assets
Item Purchase
# Date Vendor Description Invoice # Asset
Serial No. Tag #
------------------------------------------------------------------------------------------------------------------------------------
171 8114/98 Grainger 60" w Electronic Riser 1929521746 N/A
172 8/14/98 Grainger Chrome wire shelving 3547812101 NIA
173 8/10/98 EZConn Enterprise Inc. Fusion Splicer 870810 s-174
174 8/10/98 EZConn Enterprise Inc. High Precision ▇▇▇▇▇▇▇ & fiber Stripper 870810 S321 8 S210
175 8/26/98 Rifocs Fiber Optic Loss Analyzer Set 1021197 in 11003, 110995 R 110970, 110982 8 111020
175a 8/26/98 Rifocs Fiber Optic (parts have s/n's) 1021197-in 111021 8 110440, 110441, 110613 ,110614
176 8/31/98 Ando Corporation Optical Spectrum analyzer 98194 80684507
177 8/24/98 Newport Rotary Stage. 46MM 631658
178 8124/98 Newport Bracket, universal 631658
179 9/9/98 Hewlett Packard Tunable Laser Source 8 connector 7bg2625 3611800306
180 8/24/98 Rifocs Fiber Optic Visual Fault Finder - Laser Source Pen, 635n 9838323
181 8/31/98 Techni-Tool Two Port Soldering System 794448
Financed Unit Subtotal Frieght Tax Acquisition
Quantity Amount Price Installation Price
--------------------------------------------------------------------------------------------------------------------------------
171 8114/98 Grainger 1 52.83 52.83 52.83 4.36 57.19
172 8/14/98 Grainger 1 208.13 208.13 208.13 17.17 225.30
173 8/10/98 EZConn Enterprise Inc. 1 18500.00 18500.00 18500.00 0.00 18500.00
174 8/10/98 EZConn Enterprise Inc. 1 1200.00 1200.00 0.00 1200.00
175 8/26/98 Rifocs Fiber Optic 2 14612.00 7306.00 14612.00 32.24 14644.24
175a 8/26/98 Rifocs Fiber Optic 3128.79 39628.79
176 8/31/98 Ando Corporation 1 36500.00 36500.00 36500.00 0.00 2288.00
177 8/24/98 Newport 4 2288.00 572.00 2288.00 18.40 168.40
178 8124/98 Newport 2 150.00 75.00 150.00 4234.06 55556.06
179 9/9/98 Hewlett Packard 1 51322.00 51322.00 51322.00 4.01 1789.01
180 8/24/98 Rifocs Fiber Optic 3 1785.00 595.00 1785.00 238.91 1605.61
181 8/31/98 Techni-Tool 2 1366.70 683.35 1366.70 238.91 238.91
TOTAL HDWE/COMPUTER/EQUIP 740980.10 606804.78 740980.10 45340.94 786321.04