EXHIBIT 10.8
M A S T E R L E A S E A G R E E M E N T
COMDISCO, INC. - LESSOR
MASTER LEASE AGREEMENT dated November 24, 1993 by and between COMDISCO, INC.
("LESSOR") and NEOMAGIC CORPORATION ("LESSEE").
IN CONSIDERATION of the mutual agreements described below, the parties agree as
Follows (all capitalized terms are defined in Section 14.19):
1. Property Leased.
Lessor leases to Lessee all of the Equipment described on each Schedule. In
the event of a conflict, the terms of a Schedule prevail over this Master Lease.
2. TERM.
Or 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
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, in immediately available funds, on the
first day of each Rent Interval to the payee and at the location specified in
Lessor's invoice. Interim Rent is due and payable when invoiced. If any payment
is not made when due, Lessee will pay interest at the Overdue Rate. 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.
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
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 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, 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 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 Lessor, Owner, any
Assignee and Secured Party harmless from and against any loss caused by Lessee's
failure to do so.
5.2 Relocation or Sublease. Upon prior written consent, 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, (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) the sublease is
not to a leasing entity
affiliated with the manufacturer of the Equipment described on the Schedule.
Lessor acknowledges Lessee's right to sublease for a term which extends beyond
the expiration of the Initial Term. If Lessee subleases the Equipment for a term
extending beyond the expiration of such Initial Term of the applicable Schedule,
Lessee will remain obligated upon the expiration of the Initial Term to return
such Equipment, or, at Lessor's sole discretion to (i) return Like Equipment or
(ii) negotiate a mutually acceptable lease extension or purchase. If the parties
cannot mutually agree upon the terms of an extension or purchase, the term of
the Schedule will extend upon the original terms and conditions until terminated
pursuant to Section 2.
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 Schedule constitutes a net lease. Lessee's obligation
to pay Rent and all other amounts 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 Schedule against Lessor, Lessee or the Equipment by any
governmental authority (except only Federal, state and local taxes on the
capital or the net income of Lessor). Lessor will file all personal property
tax returns for the Equipment and pay all property taxes due. Lessee will
reimburse Lessor for property taxes within thirty (30) days of receipt of an
invoice.
7. Care, Use and Maintenance; Attachments and Reconfigurations; and 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, 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, 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. The lease term
will continue upon the same terms and conditions until recertification has been
obtained.
7.2 Attachments and Reconfigurations. Upon receiving the prior written
consent of Lessor, Lessee may reconfigure and install Attachments on the
Equipment. In the event of such a Reconfiguration or Attachment, Lessee will,
upon return of the Equipment, at its expense, restore the Equipment to the
original configuration specified on the Schedule in accordance with the
manufacturer's specifications and in the same operating order, repair and
appearance as when installed (normal wear and tear excluded). If any parts of
the Equipment are removed during a Reconfiguration or Attachment, Lessor may
require Lessee to provide additional security, satisfactory to the Lessor, in
order to ensure performance of Lessee's obligations set forth in this
subsection. Neither Attachments nor parts installed on Equipment in the course
of Reconfiguration will be accessions to the Equipment.
7.3 Inspection by Lessor. Upon request, 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.
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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 laws 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; 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 such Lease.
(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
Certificate 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.
(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 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 its address set forth herein 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 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.
Lessee will keep all Equipment free from any other marking or labeling which
might be interpreted as a claim of ownership.
11. Indemnity.
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. 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
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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 Lessor'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, 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 Schedule:
(a) Lessee's failure to pay Rent or other amounts payable by Lessee when due
if that failure continues for five (5) 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) 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 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.
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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 points over the prime
rate as referenced in the Wall Street Journal at the time of the
mitigation) 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. Lessor or its duly appointed representative 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 Lease.
14.2 Financial Statements. Lessee will provide to Lessor the financial
statements specified in this Section, prepared in accordance with generally
accepted accounting principles, consistently applied (the "Financial
Statements"); provided, however, 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, to be provided no less
frequently than quarterly. Lessee will provide to Lessor (i) as soon as
practicable (within thirty (30) days) after the end of each month, 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, certified by Lessee's Chief Executive or Financial Officer to be
true and correct; and (ii) as soon as practicable (and in any event within
ninety (90) days) after the end of each fiscal year, audited balance sheets as
of the end of such year (consolidated if applicable), and related statements of
income or loss, retained earnings or deficit and changes in the financial
position and capital structure of Lessee for such year, setting forth in
comparative form the corresponding figures for the preceding fiscal year, 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.
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
the 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.
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.
14.5 Entire Agreement. This Master Lease and associated 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
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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 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
actual receipt or three days after mailing if mailed postage prepaid by regular
or airmail to Lessor (to the attention of "Lease Administrator") or Lessee, at
the address set out in the Schedule or, one day after it is sent by courier or
on the same day as sent via facsimile transmission, provided that the original
is sent by personal delivery or mail by the receiving 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 Nonspecified Features and Licensed Products. If the Equipment is
supplied from Lessor's inventory and contains any features not specified in the
Schedule, Lessee grants Lessor the right to remove any such features. Any
removal will be performed by the manufacturer or another party acceptable to
Lessee, upon the request of Lessor, at a time convenient to Lessee, provided
that Lessee will not unreasonably delay the removal of such features.
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 Additional Documents. Lessee will, upon execution of this Master
Lease and as may be requested thereafter, provide Lessor with a secretary's
certificate of incumbency and authority and any other documents reasonably
requested by Lessor. 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 Lessor's Right to Match. Lessee's rights under Section 5.2 and 7.2
are subject to Lessor's right to match any sublease or upgrade proposed by a
third party. Lessee will provide Lessor with the terms of the third party offer
and Lessor will have three (3) business days to match the offer. Lessee will
obtain such upgrade from or sublease the Equipment to Lessor if Lessor has
timely matched the third party offer.
14.17 Landlord/Mortgage 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.
14.18 Equipment Procurement Charges/Progress Payments. Lessee hereby agrees
that Lessor shall not, by virtue of its entering into this Lease, be required to
remit any payments to any manufacturer or other third party until Lessee accepts
the Equipment subject to this Lease.
14.19 Definitions.
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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.
Attachment - means any accessory, equipment or device and the installation
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thereof that does not impair the original function or use of the Equipment and
is capable of being removed without causing material damage to the Equipment and
is not an accession to the 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 Certificate - means the Lessor provided certificate which must be
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signed by Lessee within ten (10) days of the Commencement Date as requested by
Lessor.
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.
Equipment - means the property described on a Schedule and any replacement for
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that property required or permitted by this Master Lease or a Schedule but not
including any Attachment.
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.
Installation Date - means the day on which Equipment is installed and qualified
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for a commercially available manufacturer's standard maintenance contract or
warranty coverage, if available.
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.
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.
Like Part - means a substituted part which is lien free and of the same
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manufacturer and part number as the removed part, and which when installed on
the Equipment will be eligible for maintenance coverage with the manufacturer of
the 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 of the Lessee to any other person or entity or any stock acquisition of
the Lessee by any other person or entity.
Notice Period - means the time period described in a Schedule during which
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Lessee may give Lessor notice of the termination of the term of that Schedule.
Overdue Rate - means the lesser of five percent (5%) of the payment due or the
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maximum rate permitted by the law of the state where the Equipment is located.
Owner - means the owner of Equipment.
-----
Reconfiguration - means any change to Equipment that would upgrade or downgrade
---------------
the performance capabilities of the Equipment in any way.
Rent - means the rent, including Interim Rent, Lessee will pay for each item of
----
Equipment expressed in a 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
-------------
Schedule.
7
Schedule - means an Equipment Schedule which incorporates all of the terms and
--------
conditions of this Master Lease and, for purposes of Section 14.12, its
associated Commencement Certificate(s).
Secured Party - means an entity to whom Lessor has granted a security interest
-------------
in a Schedule and related Equipment for the purpose of securing a loan.
IN WITNESS WHEREOF, the parties hereto have executed this Master Lease on or
as of the day and year first above written.
NeoMagic Corporation COMDISCO, INC.
as Lessee as Lessor
By: /s/ P.C. Agarwal By: /s/ [XXXXXXXXXXXXX]
--------------------------------- ---------------------------------
Title: President/CEO Title: [XXXXXXXXXXXX]
------------------------------ -------------------------------
04/20/93 12/9/93
8
EXHIBIT A
(MULTIPLE MONTHLY DELIVERY)
SCHEDULE NO. VL-1 DATED AS OF NOVEMBER 24, 1993
----- -----------------
TO MASTER LEASE AGREEMENT DATED AS OF NOVEMBER 24, 1993 ("MASTER LEASE")
-----------------
LESSEE: NEOMAGIC CORPORATION LESSOR: COMDISCO, INC.
Admin. Contact/Phone No.: Address for all Notices:
------------------------ -----------------------
▇▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(408) 970-3763 ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Address for Notice.: Attn.: Capital Equipment Lease
------------------- Administration
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.:
Central Billing Location: PAYING AGENT:
------------------------ ------------
Same as above
Comdisco, Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Lessee Reference No.: ______________
(24 digits maximum)
Location of Equipment: Initial Term: 42
--------------------- ------------ -----------
Same as above
Attn.: Lease Rate Factor: 2.764%
----------------- --------
EQUIPMENT (as defined below): Advance: $8,292.00
------- -------------------
Item Machine Type/ Serial
No. Qty. Manufacturer Feature Description Number Rent
---- ----- ------------ ------------ ----------- ------ -----
Equipment specifically approved by Lessor, which shall be delivered to and
accepted by Lessee during the period November 17, 1993 through November 17,
1994, for which Lessor receives vendor invoices approved for payment, up to
an aggregate purchase price of $300,000; not including upgrades thereto and
further excluding customer use equipment, leasehold improvements,
installation costs and delivery costs, rolling stock, special tooling,
custom equipment, "stand-alone" software, application software bundled into
computer hardware, hand held items, molds and fungible items. In no event
shall any furniture exceed fifteen percent (15%) of Lessor's aggregate cost
hereunder.
1. NOTICE PERIOD: Not less than ninety (90) days nor more than twelve (12)
months prior to the expiration of the lease term.
2. EQUIPMENT PURCHASE
Lessee acknowledges that it has either received or approved Lessor's
purchase documentation for the Equipment. The aggregate purchase price referred
to on the face of this Schedule shall include all Equipment purchased by Lessor,
consisting of amounts financed ***** Sections (i), (ii) and (iii) below.
(i) NEW EQUIPMENT. Lessor will purchase new Equipment which is
specifically approved by Lessor.
(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). For Equipment installed
prior to the date hereof Lessee must submit request to Lessor no
later than December 17, 1993 and if approved for inclusion under
this Lease, at Lessor's actual net appraised Equipment value
pursuant to the schedule below.
ORIGINAL EQUIPMENT PERCENT OF ORIGINAL MANUFACTURER'S
MANUFACTURER'S SHIP DATE NET EQUIPMENT COST PAID BY LESSOR
------------------------------ ----------------------------------
Between 09/18/93 and 12/17/93 100%
Between 07/18/93 and 09/17/93 80%
For Equipment installed after the date hereof Lessee must submit
request to Lessor within the last ten (10) days of each month and
Lessor will not perform a Sale-Leaseback transaction on such
installed Equipment which arrives ninety (90) days after the
original purchase of the Equipment.
(iii) USED EQUIPMENT. Lessor will purchase "used" Equipment which is
obtained from a third party by Lessee for its use subject to: (1)
Lessor's prior approval of the Equipment; and (2) at Lessor's
appraised value for such used Equipment.
3. COMMENCEMENT DATE
The Commencement Date for each item of Equipment will be its Installation
Date. Lessee agrees to confirm the Commencement Date by providing Lessor with
Invoices containing the Equipment location, description, serial number and cost,
the Installation Date and Lessee's signature. Lessor will summarize all Invoices
and/or IAFs received in the same calendar month into a Commencement Certificate
in the form attached to this Schedule as Exhibit 1 and the Initial Term will
begin the first day of the calendar month thereafter provided, however that each
Commencement Certificate must cover equipment with an equipment cost of at lease
$10,000 or Lessor shall ????????????? include such equipment on the Commencement
Certificate for the next succeeding month. Each Commencement Certificate will
incorporate the terms and conditions of the Master Lease and this Schedule and
will constitute a separate Schedule. Notwithstanding the foregoing, if the
Equipment pertains to Sale-Leaseback Equipment the Commencement Date will be the
date Lessor tenders the purchase price.
4. OPTION TO EXTEND
So long as no Event of Default shall have occurred and be continuing,
Lessee will have the right to extend the Initial Term of this Schedule for a
period of one (1) year by giving Lessor at least ninety (90) days written notice
prior to the expiration of the Initial Term. In such event, the rent to be paid
during said extended period shall be mutually agreed upon and if the parties
cannot mutually agree, then the Lease shall continue in full force and effect
pursuant to the existing terms and conditions until terminated in accordance
with its terms. This 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 Rent Interval
next following receipt.
5. 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, Lessee will have
the option at the expiration of the Initial Term of this Schedule to purchase
all, but not less than all, of the Equipment listed herein for a purchase price
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 at least thirty (30) days
before the expiration date of the Initial 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. If the parties
are unable to agree on the purchase price or the terms and conditions with
respect to said purchase, then the Lease with respect to this Equipment shall
remain in full force and effect. It is agreed and understood that Lessor is
retaining a purchase money security interest in the Equipment listed herein and
this Schedule shall constitute a Security Agreement under the Uniform Commercial
Code of the state in which the Equipment is located. Lessor and Lessee agree
that for purposes of this paragraph, any licensed software will not be
considered part of the Equipment.
6. SPECIAL TERMS
The terms and conditions of the Master Lease Agreement as they pertain to
this Schedule are hereby modified and amended as follows:
(a) Section 4.2, "Warranty and Disclaimer of Warranties"
---------------------------------------
In the last line of this Section before the words "negligent acts",
insert the words "willful or".
(b) Section 6.2, "Taxes and Fees"
----------------
To the end of this Section, add the following:
"Lessee shall not be liable for any taxes, fees or charges to the
extent the same result from any sale or assignment
or grant of security interest by Lessor, or to the extent any such
action increases the taxes, fees or charges that would otherwise be
payable. Lessee shall have the right to contest by proper legal
proceedings any taxes levied, as agent for or in the name of Lessor,
and to withhold payment of any disputed amount of taxes. Lessor will
cooperate in any legal proceedings being prosecuted by Lessee with
regard to any taxes, but Lessee shall pay the expenses in such
litigation. Lessee shall not be obligated to pay any taxes so long as
it shall be in good faith and by appropriate proceeding contesting the
validity or the amount thereof unless such contest would adversely
affect the title of the Lessor to the Equipment or would subject it to
forfeiture or sale."
(c) Section 8, "Representations and Warranties of Lessee"
------------------------------------------
To the end of subsection (b), add the following:
", subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally, and rules of law
concerning equitable remedies."
(d) Section 12, "Risk of Loss"
--------------
In line 3 of paragraph 2, delete the words "at Lessors's option" and
replace with the words "at Lessee's option".
(e) Section 14.1, "Board Attendance"
------------------
Delete the first sentence of this Section in its entirety.
(f) Section 14.2, "Financial Statements"
----------------------
Change the beginning of subsection (ii) as follows:
"beginning with the year ended December 31, 1994, as soon as
practicable (and in any event within one hundred twenty (120) days)
after the end of each fiscal year,".
(g) Section 14.4, "Merger and Sale Provisions"
----------------------------
At the end of the first sentence, add the following:
"provided, however, that Lessor shall consent to the assignment in the
event of a proposed Merger which would qualify as an Accelerating
Merger for purposes of the Warrant Agreement dated as of the date
hereof."
Delete the language in line 7 after the words "and will" and replace
with the following:
"either (a) return the Equipment in accordance with Section 9, or (b)
pay to Lessor an additional amount to pay for the purchase price of
the Equipment as of the expiration of the Initial Term."
(h) SECTION 14.19 DEFINITIONS
-----------
Delete Interim Rent definition and replace with
"Interim Rent - means 13% per annum of Lessor's Cost for the period
------------
from the Commencement Date through but not including the first day of
the first full Rent Interval included in the Initial Term."
MASTER LEASE: This Schedule is issued pursuant to the Master Lease identified
on page 1 of this Schedule. All of the terms and conditions of the Master 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 Master 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.
NEOMAGIC CORPORATION COMDISCO, INC.
as Lessee as Lessor
By: /s/ P.C. Agarwal By: SIGNATURE ILLEGIBLE
----------------------- -------------------------
Title: President/CEO Title: TITLE ILLEGIBLE
-------------------- ----------------------
Date: 11/30/93 Date: 12/7/93
--------------------- -----------------------
EXHIBIT 1
COMMENCEMENT CERTIFICATE
------------------------
This Certificate dated is executed pursuant to Schedule No. to the Master
Lease Agreement dated between Comdisco, Inc. ("Lessor") and ("Lessee"). All of
the terms, conditions, representations and warranties of the Master Lease and
Schedule No. are incorporated herein and made a part hereof and this
Commencement Certificate constitutes a Schedule for the Equipment described
below.
1. EQUIPMENT:
---------
EQUIPMENT
QTY MFGR TYPE/MODEL SERIAL # LOCATION
--- ---- ---------- -------- --------
(See attached Invoices)
2. INSTALLATION DATE: (See attached Invoices)
-----------------
3. INITIAL TERM STARTS ON:
----------------------
4. TOTAL EQUIPMENT COST:
--------------------
5. RENT:
----
6. REPRESENTATIONS OF LESSEE:
-------------------------
Each item of Equipment has been delivered to the location indicated above,
tested, inspected, found to be in good working order and accepted by the
Lessee on its Installation Date.
EXHIBIT A
(MULTIPLE MONTHLY DELIVERY)
SCHEDULE NO. VL-2 DATED AS OF May 17, 1994
------- ------------
To MASTER LEASE AGREEMENT DATED AS OF November 17, 1993 ("MASTER LEASE")
-------------------
LESSEE: NEOMAGIC CORPORATION LESSOR: COMDISCO, INC.
Admin. Contact/Phone No.: Address for all Notices:
------------------------ -----------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: Capital Equipment Lease
Administration
Address for Notices:
-------------------
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.:
Central Billing Location: PAYING AGENT:
------------------------ ------------
Same as above
Comdisco, Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.:
Lessee Reference No.: __________________
(24 digits maximum)
Location of Equipment: Initial Term: 42
--------------------- ------------ --------------
Same as above
Lease Rate Factor: 2.764%
----------------- -----------
Attn.:
EQUIPMENT (as defined below): Advance: $7,462.80
------- ---------------------
Item Machine Type/ Serial
No. Qty. Manufacturer Feature Description Number Rent
---- ---- ------------ ------------- ----------- ------ ----
One Quickturn LBM-3D (as described on the attached Exhibit II) and additional
Equipment approved by Lessor, which shall be delivered to and accepted by Lessee
during the period May 17, 1994 through November 17, 1994, for which Lessor
receives vendor invoices approved for payment, up to an aggregate purchase price
of $270,000 not including upgrades thereto and further excluding customer use
equipment, leasehold improvements, installation costs and delivery costs,
rolling stock, special tooling, custom equipment, "stand-alone" software,
application software bundled into computer hardware, hand held items, molds and
fungible items.
1. NOTICE PERIOD: Not less than ninety (90) days nor more than twelve (12)
months prior to the expiration of the lease term.
2. EQUIPMENT PURCHASE
Lessee acknowledges that it has either received or approved Lessor's
purchase documentation of the Equipment. The aggregate purchase price referred
to on the face of this Schedule shall include all Equipment purchased by Lessor,
consisting of amounts financed under Sections (i), (ii) and (iii) below.
(i) NEW EQUIPMENT. Lessor will purchase new Equipment which is
specifically approved by Lessor.
(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). For Equipment installed
prior to the date hereof Lessee must submit request to Lessor no
later than June 17, 1994 and if approved for inclusion under this
Lease, at Lessors's actual net appraised Equipment value pursuant to
the schedule below.
ORIGINAL EQUIPMENT PERCENT OF ORIGINAL MANUFACTURER'S
MANUFACTURER'S SHIP DATE NET EQUIPMENT COST PAID BY LESSOR
----------------------------- ----------------------------------
Between 03/19/94 and 06/17/94 100%
For Equipment installed after the date hereof Lessee must submit
request to Lessor within the last ten (10) days of each month and Lessor will
not perform a Sale-Leaseback transaction on such installed Equipment which
arrives ninety (90) days after the original purchase of the Equipment.
(iii) USED EQUIPMENT. Lessor will purchase "used" Equipment which is
obtained form a third party by Lessee for its use subject to: (1)
Lessor's prior approval of the Equipment; and (2) at Lessor's
appraised value for such used Equipment.
3. COMMENCEMENT DATE
The Commencement Date for each item of Equipment will be its Installation
Date. Lessee agrees to confirm the Commencement Date by providing Lessor with
Invoices containing the Equipment location, description, serial number and cost,
the Installation Date and Lessee's signature. Lessor will summarize all Invoices
and/or IAFs received in the same calendar month into a Commencement Certificate
in the form attached to this Schedule as Exhibit 1 and the Initial Term will
begin the first day of the calendar month thereafter provided, however that each
Commencement Certificate must cover equipment with an equipment cost of at lease
$10,000 or Lessor shall instead include such equipment on the Commencement
Certificate for the next succeeding month. Each Commencement Certificate will
incorporate the terms and conditions of the Master Lease and this Schedule and
will constitute a separate Schedule. Notwithstanding the foregoing, if the
Equipment pertains to Sale-Leaseback Equipment the Commencement Date will be the
date Lessor tenders the purchase price.
4. OPTION TO EXTEND
So long as no Event of Default shall have occurred and be continuing,
Lessee will have the right to extend the Initial Term of this Schedule for a
period of one (1) year by giving Lessor at least ninety (90) days written notice
prior to the expiration of the Initial Term. In such event, the rent to be paid
during said extended period shall be mutually agreed upon and if the parties
cannot mutually agree, then the Lease shall continue in full force and effect
pursuant to the existing terms and conditions until terminated in accordance
with its terms. This 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 shall be effective as of the Rent Interval next
following receipt.
PURCHASE OPTION
So long as no Event of Default shall 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, Lessee
will have the option at the expiration of the Initial Term of this Schedule to
purchase all, but not less than all, of the Equipment listed herein for a
purchase price 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 at least thirty (30) days before the
expiration date of the Initial 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. If the parties are unable
to agree on the purchase price or the terms and conditions with respect to said
purchase, then the Lease with respect to this Equipment shall remain in full
force and effect. It is agreed and understood that Lessor is retaining a
purchase money security interest in the Equipment listed herein and this
Schedule shall constitute a Security Agreement under the Uniform Commercial Code
of the state in which the Equipment is located. Lessor and Lessee agree that for
purposes of this paragraph, any licensed software will not be considered part of
the Equipment.
6. SPECIAL TERMS
The terms and conditions of the Master Lease Agreement as they pertain to
this Schedule are hereby modified and amended as follows:
(a) Section 4.2, "Warranty and Disclaimer of Warranties"
---------------------------------------
In the last line of this Section before the words "negligent acts",
insert the words "willful or"
(b) Section 6.2, "Taxes and Fees"
----------------
To the end of this Section, add the following:
"Lessee shall not be liable for any taxes, fees or charges to the
extent the same result from any sale or assignment or grant of
security interest by Lessor, or to the extent any such action
increases the taxes, fees or charges that would otherwise be payable.
Lessee shall have the right to contest by proper legal proceedings any
taxes levied, as agent for or in the name of Lessor, and to withhold
payment of any disputed amount of taxes. Lessor will cooperate in any
legal proceedings being prosecuted by Lessee with regard to any taxes,
but Lessee shall pay the expenses in such litigation. Lessee shall not
be obligated to pay any taxes so long as it shall be in good faith and
by appropriate proceeding contesting the validity or the amount
thereof unless such contest would adversely affect the title of the
Lessor to the Equipment or would subject it to forfeiture or sale."
(c) Section 8, "Representations and Warranties of Lessee"
------------------------------------------
To the end of subsection (b), add the following:
", subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally, and rules of law
concerning equitable remedies."
(d) Section 12, "Risk of Loss"
--------------
In line 3 of paragraph 2, delete the words "at Lessor's option" and
replace with the words "at Lessee's option".
(e) Section 14.1, "Board Attendance"
------------------
Delete the first sentence of this Section in its entirety.
(f) Section 14.2, "Financial Statements"
----------------------
Change the beginning of subsection (ii) as follows:
"beginning with the year ended December 31, 1994, as soon as
practicable (and in any event within one hundred twenty (120) days)
after the end of each fiscal year,".
(g) Section 14.4, "Merger and Sale Provisions"
----------------------------
At the end of the first sentence, add the following:
"provided, however, that Lessor shall consent to the assignment in the
event of a proposed Merger which would qualify as an Accelerating
Merger for purposes of the Warrant Agreement dated as of the date
hereof."
Delete the language in line 7 after the words "and will" and replace
with the following:
"either (a) return the Equipment in accordance with Section 9, or (b)
pay to Lessor an additional amount to pay for the purchase price of
the Equipment as of the expiration of the Initial Term."
(H) SECTION 14.19 DEFINITIONS
-----------
Delete Interim Rent definition and replace with
"Interim Rent - means 13% per annum of Lessor's Cost for the period
------------
from the Commencement Date through but not including the first day of
the first full Rent Interval included in the Initial Term."
MASTER LEASE: This Schedule is issued pursuant to the Master Lease identified
on page 1 of this Schedule. All of the terms and conditions of the Master 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 Master 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.
NEOMAGIC CORPORATION COMDISCO, INC.
as Lessee as Lessor
By: /s/ P.C. Agarwal By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------- -------------------------
Title: President/CEO Title: HVP/Venture Lease
-------------------- ----------------------
Date: 5/23/94 Date: 5/31/94
--------------------- -----------------------
EXHIBIT 1
COMMENCEMENT CERTIFICATE
------------------------
This Certificate dated is executed pursuant to Schedule No. to the Master
Lease Agreement dated between Comdisco, Inc. ("Lesssor") and ("Lessee"). All of
the terms, conditions, representations and warranties of the Master Lease and
Schedule No. are incorporated herein and made a part hereof and this
Commencement Certificate constitutes a Schedule for the Equipment described
below.
1. EQUIPMENT:
---------
EQUIPMENT
QTY MFGR TYPE/MODEL SERIAL # LOCATION
--- ---- ---------- -------- --------
(See attached Invoices)
2. Installation Date: (See attached Invoices)
-----------------
3. Initial Term Starts on:
----------------------
4. Total Equipment Cost:
--------------------
5. Rent:
----
6. Representations of Lessee:
-------------------------
Each item of Equipment has been delivered to the location indicated above,
tested, inspected, found to be in good working order and accepted by the
Lessee on its Installation Date.
Quickturn Design Systems, Inc. EXHIBIT II INVOICE SHIPMENT ID NUMBER: 1001748
[LOGO APPEARS HERE] ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ -----------------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ INVOICE NO 1709N DATE PAGE
▇▇▇ ▇▇▇ ▇▇▇▇ fax ▇▇▇ ▇▇▇ ▇▇▇▇ 102915 0 03/22/94 1
-----------------------------------------
----------------------------------------- ------------------------------------------- CUSTOMER ORDER NO SALES ORDER NO TAXABLE
Lt 10: SHIP TO: *SEE BELOW 11806 NO
----------------------------------------- ------------------------------------------- -----------------------------------------
▇▇▇▇ OF LADING NO. DATE OF SHIPMENT
NEO MAGIC CORPORATION NEO MAGIC CORPORATION 03/22/94
ATTN: ACCOUNTS PAYABLE ATTN: ▇▇▇▇▇▇▇ ▇▇▇▇▇ -----------------------------------------
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ SHIPPED ▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ GROUND 1
-----------------------------------------
SA.
TG-2
-----------------------------------------
TERMS
NET 60
-----------------------------------------
▇▇▇▇ TO CUSTOMER:- NEOMAG-100 SHIP TO CUSTOMER:- NEOMAG-200 *P.O.: 1017
------------------------------------------------------------------------------------------------------------------------------------
EM PRODUCT NUMBER DESCRIPTION TAX DTY. SHIPPED *** UNIT PRICE EXTENSION
------------------------------------------------------------------------------------------------------------------------------------
1 LBM3000 LBM-30 ASSEMBLY 1 0 0 91200.00 91200.00
S/N: 4312-275
2 DBW1000 DEBUGWARE 1 0 0 72200.00 72200.00
3 PRM3000 PROBE ASSEMBLY 8 0 0 6095.20 48761.60
4 CKP3020 CLOCK POD 3 1 0 0 1056.40 1056.40
5 DAP3020 DATA POD 64 16 0 0 1140.00 18240.00
6 TKY3000 TESTER KEY 16 0 0 60.80 972.80
7 EIK3000 ETHERNET INTERFACE KIT 1 0 0 532.00 532.00
8 IOC3100 I/O CABLE 16 0 0 288.80 4620.80
9 DCA3000 JTAG/DOWNLOAD CABLE 1 0 0 76.00 76.00
10 CKC3000 CLOCK CABLE 4 FT 2 0 0 53.20 106.40
11 PIA3100 PIA MODULE 2 2 0 0 630.80 1261.60
12 ICCB3000 CONSOLE CABLE 1 0 0 98.04 98.04
13 IXPR1000 XILINX P&R NETWORK LICENSE 1 0 0 7600.00 7600.00
14 MUG3000 MARS USER'S GUIDE 1 0 0 190.00 190.00
15 SW3000 MARS III SOFTWARE 1 0 0 .00 .00
MARS BASE SOFTWARE INCLUDES:
* EMULATION SOFTWARE
* FUNCTIONAL ACCELERATOR
SOFTWARE
* HIERARCHICAL NETWORK
NAVIGATOR SOFTWARE
* LBM MEMORY COMPILER
SOFTWARE
----------
TOTAL: 246915.64
-----------------------------------------------------------------------------------------------------------------------
***
EXHIBIT A
(MULTIPLE MONTHLY DELIVERY)
SCHEDULE NO. VL-4 DATED AS OF AUGUST 1, 1994
------ --------------
MASTER LEASE AGREEMENT DATED AS OF NOVEMBER 17, 1993 ("MASTER LEASE")
----------------------
LESSEE: NEOMAGIC CORPORATION LESSOR: COMDISCO, INC.
Admin. Contact/Phone No.: Address for all Notices:
------------------------ ------------------------
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: Capital Equipment Lease
Administration
Address for Notices:
-------------------
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.:
Central Billing Location: PAYING AGENT:
------------------------ ------------
Same as above
Comdisco, Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.:
Lessee Reference No.: ________________
(24 digits maximum)
Location of Equipment: Initial Term: 30
--------------------- ------------ ----------------
Same as above
Lease Rate Factor: 4.102%
----------------- -----------
Attn.:
EQUIPMENT (as defined below): Phase I Advance: $20,510
--------------- ------------
Phase II Advance: $20,510
---------------- ------------
Item Machine Type/ Serial
No. Qty. Manufacturer Feature Description Number Rent
---- ---- ------------ ------------ ----------- ------ ----
Software approved by Lessor, which shall be delivered to and accepted by Lessee
during the period August 1, 1994 through February 1, 1996, for which Lessor
receives vendor invoices approved for payment, up to an aggregate purchase price
of $500,000 available in two (2) consecutive phases of $250,000 each ("Phase I"
and Phase II"). Both Phases are available immediately.
1. NOTICE PERIOD: Not less than ninety (90) days nor more than twelve (12)
months prior to the expiration of the lease term.
2. EQUIPMENT PURCHASE
Lessee acknowledges that it has either received or approved Lessor's
purchase documentation or the Equipment. The aggregate purchase price referred
to on the face of this Schedule shall include all Equipment purchased by Lessor,
consisting of amounts financed under Sections (i), (ii) and (iii) below.
(i) NEW EQUIPMENT. Lessor will purchase new Equipment which is
specifically approved by Lessor.
(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). For Equipment installed
prior to the date hereof Lessee must submit request to Lessor no
later than September 1, 1994 and if approved for inclusion under
this Lease, at Lessor's actual net appraised Equipment value
pursuant to the schedule below.
PERCENT OF ORIGINAL
ORIGINAL EQUIPMENT MANUFACTURER'S MANUFACTURER'S NET
SHIP DATE EQUIPMENT COST PAID BY LESSOR
--------------------------------- -----------------------------
Between 6/3/94 and 9/1/94 100%
Between 4/3/94 and 6/2/94 80%
Between 1/2/94 and 4/2/94 70%
For Equipment installed after the date hereof Lessee must submit request to
Lessor within the last ten (10) days of each month and Lessor will not perform a
Sale-Leaseback transaction on such installed Equipment which arrives ninety (90)
days after the original purchase of the Equipment.
(iii) USED EQUIPMENT. Lessor will purchase "used" Equipment which is
obtained from a third party by Lessee for its use subject to: (1)
Lessor's prior approval of the Equipment; and (2) at Lessor's
appraised value for such used Equipment.
3. COMMENCEMENT DATE
The Commencement Date for each item of Equipment will be its Installation
Date. Lessee agrees to confirm the Commencement Date by providing Lessor with
Invoices containing the Equipment location, description, serial number and cost,
the Installation Date and Lessee's signature. Lessor will summarize all Invoices
and/or IAFs received in the same calendar month into a Commencement Certificate
in the form attached to this Schedule as Exhibit 1 and the Initial Term will
begin the first day of the calendar month thereafter provided, however that each
Commencement Certificate must cover equipment with an equipment cost of at least
$10,000 or Lessor shall instead include such equipment on the Commencement
Certificate for the next succeeding month. Each Commencement Certificate will
incorporate the terms and conditions of the Master Lease and this Schedule and
will constitute a separate Schedule. Notwithstanding the foregoing, if the
Equipment pertains to Sale-Leaseback Equipment the Commencement Date will be the
date Lessor tenders the purchase price.
4. ADVANCE
The Phase I Advance due under this schedule will be due upon execution of
this schedule and Phase II Advance will be due at the time the Lessee utilizes
any portion of the amount available under Phase II.
5. SPECIAL TERMS
The terms and conditions of the Master Lease Agreement as they pertain to
this Schedule are hereby modified and amended as follows:
(a) Section 4.2, "Warranty and Disclaimer of Warranties"
---------------------------------------
In the last line of this Section before the words "negligent acts",
insert the words "willful or".
(b) Section 6.2, "Taxes and Fees"
----------------
To the end of this Section, add the following:
"Lessee shall not be liable for any taxes, fees or charges to the
extent the same
result from any sale or assignment or grant of security interest by
Lessor, or to the extent any such action increases the taxes, fees
or charges that would otherwise be payable. Lessee shall have the
right to contest by proper legal proceedings any taxes levied, as
agent for or in the name of Lessor, and to withhold payment of any
disputed amount of taxes. Lessor will cooperate in any legal
proceedings being prosecuted by Lessee with regard to any taxes, but
Lessee shall pay the expenses in such litigation. Lessee shall not
be obligated to pay any taxes so long as it shall be in good faith
and by appropriate proceeding contesting the validity or the amount
thereof unless such contest would adversely affect the title of the
Lessor to the Equipment or would subject it to forfeiture or sale."
(c) Section 8, "Representations and Warranties of Lessee"
------------------------------------------
To the end of subsection (b), add the following:
", subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally, and rules of law
concerning equitable remedies."
(d) Section 12, "Risk of Loss"
--------------
In line 3 of paragraph 2, delete the words "at Lessor's option" and
replace with the words "at Lessee's option".
(e) Section 14.1, "Board Attendance"
------------------
Delete the first sentence of this Section in its entirety.
(f) Section 14.2, "Financial Statements"
----------------------
Change the beginning of subsection (ii) as follows:
"beginning with the year ended December 31, 1994, as soon as
practicable (and in any event within one hundred twenty (120) days)
after the end of each fiscal year,".
(g) Section 14.4, "Merger and Sale Provisions"
----------------------------
At the end of the first sentence, add the following:
"provided, however, that Lessor shall consent to the assignment in
the event of a proposed Merger which would qualify as an
Accelerating Merger for purposes of the Warrant Agreement dated as
of the date hereof."
Delete the language in line 7 after the words "and will" and replace
with the following:
"either (a) return the Equipment in accordance with Section 9, or
(b) pay to Lessor an additional amount to pay for the purchase price
of the Equipment as of the expiration of the Initial Term."
(h) Section 14.19 Definitions
-----------
Delete Interim Rent definition and replace with
"Interim Rent - means 13% per annum of Lessor's Cost for the period
-------------
from the Commencement Date through but not including the first day
of the first full Rent Interval included in the Initial Term."
MASTER LEASE: This Schedule is issued pursuant to the Master Lease identified
on page 1 of this Schedule. All of the terms and conditions of the Master 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 Master 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.
NEOMAGIC CORPORATION COMDISCO, INC.
as Lessee as Lessor
By: /s/ P. C. Agarwal By: SIGNATURE ILLEGIBLE
-------------------- -----------------------
Title: President/CEO Title: TITLE ILLEGIBLE
----------------- -------------------
Date: 8/13/94 Date: 8/31/94
----------------- -----------------
EXHIBIT 1
COMMENCEMENT CERTIFICATE
------------------------
This Certificate dated is executed pursuant to Schedule No. to the Master
Lease Agreement dated between Comdisco, Inc. ("Lessor") and ("Lessee"). All of
the terms, conditions, representations and warranties of the Master Lease and
Schedule No. are incorporated herein and made a part hereof and this
Commencement Certificate constitutes a Schedule for the Equipment described
below.
1. Equipment:
---------
Equipment
Qty Mfgr Type/Model Serial # Location
--- ---- ---------- -------- --------
(See attached Invoices)
2. Installation Date: (See attached Invoices)
-----------------
3. Initial Terms Starts on:
-----------------------
4. Total Equipment Cost:
--------------------
5. Rent:
----
6. Representations of Lessee:
-------------------------
Each item of Equipment has been delivered to the location indicated above,
tested, inspected, found to be in good working order and accepted by the
Lessee on its Installation Date.
EXHIBIT A
(MULTIPLE MONTHLY DELIVERY)
SCHEDULE NO. VL-3 DATED AS OF AUGUST 1, 1994
---------- --------------
MASTER LEASE AGREEMENT DATED AS OF November 17, 1993 ("MASTER LEASE")
---------------------
LESSEE: NEOMAGIC CORPORATION LESSOR: COMDISCO, INC.
▇▇▇▇▇.▇▇▇▇▇▇▇/Phone No.: Address for all Notices:
---------------------- -----------------------
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: Capital Equipment Lease
Administration
Address for Notices:
-------------------
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.:
Central Billing Location: PAYING AGENT:
------------------------ ------------
Same as above
Comdisco, Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Lessee Reference No.: __________________
(24 digits maximum)
Location of Equipment: Initial Term: 42
--------------------- ------------ -----------------
Same as above
Attn.: Lease Rate Factor: 2.786%
----------------- ------------
EQUIPMENT (as defined below): Advance: $13,930.00
------- ----------------------
Item Machine Type/ Serial
No. Qty. Manufacturer Feature Description Number Rent
---- ---- ------------ ------------ ----------- ------ ----
One Quickturn LBM-3D and additional Equipment approved by Lessor, which shall be
delivered ** accepted by Lessee during the period August 1, 1994 through
February 1, 1996, for which L****** receives vendor invoices approved for
payment, up to an aggregate purchase price of $500,000 including upgrades
thereto and further excluding custom use equipment, leasehold improvement
installation costs and delivery costs, rolling stock, special tooling, custom
equipment, "s*** alone" software, application software bundled into computer,
hardware, hand held items, mold fungible items.
1. NOTICE PERIOD: Not less than ninety (90) days nor more than twelve (12)
months prior to the expiration of the lease term.
2. EQUIPMENT PURCHASE
Lessee acknowledges that it has either received or approved Lessor's
purchase documentation for the Equipment. The aggregate purchase price referred
to on the face of this Schedule shall include all Equipment purchased by
Lessor, consisting of amounts financed under Sections (i), (ii) and (iii) below.
(i) NEW EQUIPMENT. Lessor will purchase new Equipment which is
specifically approved by Lessor.
(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). For Equipment installed prior to the date
hereof Lessee must submit request to Lessor no later than September
1, 1994 and if approved for inclusion under this Lease, at Lessors's
actual net appraised Equipment value pursuant to the schedule below.
ORIGINAL EQUIPMENT PERCENT OF ORIGINAL MANUFACTURER'S
MANUFACTURER'S SHIP DATE NET EQUIPMENT COST PAID BY LESSOR
------------------------ ----------------------------------
Between 6/3/94 and 9/1/94 100%
Between 4/3/94 and 6/2/94 80%
Between 1/2/94 and 4/2/94 70%
For Equipment installed after the date thereof Lessee must submit
request to Lessor within the last ten (10) days of each month and Lessor will
not perform a Sale-Leaseback transaction on such installed Equipment which
arrives ninety (90) days after the original purchase of the Equipment.
(iii) USER EQUIPMENT. Lessor will purchase "used" Equipment which is
obtained from a third party by Lessee for its use subject to: (1)
Lessor's prior approval of the Equipment; and (2) at Lessor's
appraised value for such used Equipment.
3. COMMENCEMENT DATE
The Commencement Date for each item of Equipment will be its Installation
Date. Lessee agrees to confirm the Commencement Date by providing Lessor with
Invoices containing the Equipment location, description, serial number and cost,
the Installation Date and Lessee's signature. Lessor will summarize all Invoices
and/or IAFs received in the same calender month into a Commencement Certificate
in the form attached to this Schedule as Exhibit 1 and the Initial Term will
begin the first day of the calendar month thereafter provided, however that each
Commencement Certificate must cover equipment with an equipment cost of at least
$10,000 or Lessor shall instead include such equipment on the Commencement
Certificate for the next succeeding month. Each Commencement Certificate will
incorporate the terms and conditions of the Master Lease and this Schedule and
will constitute a separate Schedule. Notwithstanding the foregoing, if the
Equipment pertains to Sale-Leaseback Equipment the Commencement Date will be the
date Lessor tenders the purchase price.
4. OPTION TO EXTEND
So long as no Event of Default shall have occurred and be continuing,
Lessee will have the right to extend the Initial Term of this Schedule for a
period of one (1) year by giving Lessor at least ninety (90) days written notice
prior to the expiration of the Initial Term. In such event, the rent to be paid
during said extended period shall be mutually agreed upon and if the parties
cannot mutually agree, then the Lease shall continue in full force and effect
pursuant to the existing terms and conditions until terminated in accordance
with its terms. This 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 Rent Interval
next following receipt.
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, Lessee will have
the option at the expiration of the Initial Term of this Schedule to purchase
all, but not less than all, of the Equipment listed herein for a
purchase price 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 at least thirty (30) days
before the expiration date of the Initial 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. If the parties
are unable to agree on the purchase price or the terms and conditions with
respect to said purchase, ***** the Lease with respect to this Equipment shall
remain in full force and effect. It is agreed ***** understood that Lessor is
retaining a purchase money security interest in the Equipment listed herein and
this Schedule shall constitute a Security Agreement under the Uniform Commercial
Code of the state in which the Equipment is located. Lessor and Lessee agree
that for purposes of this paragraph, any licensed software will not be
considered part of the Equipment.
6. SPECIAL TERMS
The terms and conditions of the Master Lease Agreement as they pertain to
this Schedule are hereby modified and amended as follows:
(a) Section 4.2, "Warranty and Disclaimer of Warranties"
---------------------------------------
In the last line of this Section before the words "negligent acts",
insert the words "willful or".
(b) Section 6.2, "Taxes and Fees"
----------------
To the end of this Section, add the following:
"Lessee shall not be liable for any taxes, fees or charges to the
extent the same result from any sale or assignment or grant of
security interest by Lessor, or to the extent any such action
increases the taxes, fees or charges that would otherwise be payable.
Lessee shall have the right to contest by proper legal proceedings any
taxes levied, as agent for or in the name of Lessor, and to withhold
payment of any disputed amount of taxes. Lessor will cooperate in any
legal proceedings being prosecuted by Lessee with regard to any taxes,
but Lessee shall pay the expenses in such litigation. Lessee shall not
be obligated to pay any taxes so long as it shall be in good faith and
by appropriate proceeding contesting the validity or the amount
thereof unless such contest would adversely affect the title of the
Lessor to the Equipment or would subject it to forfeiture or sale."
(c) Section 8, "Representations and Warranties of Lessee"
------------------------------------------
To the end of subsection (b), add the following:
", subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally, and rules of law
concerning equitable remedies."
(d) Section 12, "Risk of Loss"
--------------
In line 3 of paragraph 2, delete the words "at Lessor's option" and
replace with the words "at Lessee's option".
(e) Section 14.1, "Board Attendance"
------------------
Delete the first sentence of this Section in its entirety.
(f) Section 14.2, "Financial Statements"
----------------------
Change the beginning of subsection (ii) as follows:
"beginning with the year ended December 31, 1994, as soon as
practicable (and in any event within one hundred twenty (120) days)
after the end of each fiscal year,".
(g) Section 14.4, "Merger and Sale Provisions"
----------------------------
At the end of the first sentence, add the following:
"provided, however, that Lessor shall consent to the assignment in the
event of a proposed Merger which would qualify as an Accelerating
Merger for purposes of the Warrant Agreement dated as of the date
hereof."
Delete the language in line 7 after the words "and will" and replace
with the following:
"either (a) return the Equipment in accordance with Section 9, or (b)
pay to Lessor an additional amount to pay for the purchase price of
the Equipment as of the expiration of the Initial Term."
(H) SECTION 14.19 DEFINITIONS
-----------
Delete Interim Rent definition and replace with
"Interim Rent - means 13% per annum of Lessor's Cost for the period
------------
from the Commencement Date through but not including the first day of
the first full Rent Interval included in the Initial Term."
MASTER LEASE: This Schedule is issued pursuant to the Master Lease identified
on page 1 of this Schedule. All of the terms and conditions of the Master 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 Master 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.
NEOMAGIC CORPORATION COMDISCO, INC.
as Lessee as Lessor
By: /s/ P.C. Agarwal By: SIGNATURE ILLEGIBLE
----------------------- -------------------------
Title: President/CEO Title: TITLE ILLEGIBLE
-------------------- ----------------------
Date: 8/13/94 Date: 8/31/94
--------------------- -----------------------
EXHIBIT 1
COMMENCEMENT CERTIFICATE
------------------------
This Certificate dated is executed pursuant to Schedule No. to the Master
Lease Agreement ***** between Comdisco, Inc. ("Lessor") and ("Lessee"). All of
the terms, conditions, representations and warranties of the Master Lease and
Schedule No. are incorporated herein and made a part hereof and this
Commencement Certificate constitutes a Schedule for the Equipment described
below.
1. EQUIPMENT:
---------
EQUIPMENT
QTY MFGR TYPE/MODEL SERIAL # LOCATION
--- ---- ---------- -------- --------
(See attached Invoices)
2. INSTALLATION DATE: (See attached Invoices)
-----------------
3. INITIAL TERM STARTS ON:
----------------------
4. TOTAL EQUIPMENT COST:
--------------------
5. RENT:
----
6. REPRESENTATIONS OF LESSEE:
-------------------------
Each item of Equipment has been delivered to the location indicated above,
tested, inspected, found to be in good working order and accepted by the
Lessee on its Installation Date.