Exhibit 10.9
W I N T H R O P
Financial Services
Lease Agreement Number NC102203
Lease Agreement
This Lease Agreement, dated
October 22, 2003, by and between WINTHROP RESOURCES
CORPORATION (the “Lessor”) with an office located at
11100 Wayzata Boulevard, Suite 800, Minnetonka, Minnesota 55305 and
NCI INFORMATION SYSTEMS, INC. (the “Lessee”)
with an office located at 11730 Plaza America Drive, Reston, VA
20190 .
Lessor hereby leases or grants to
the Lessee the right to use and Lessee hereby rents and accepts the
right to use the equipment listed by serial number and related
services, and software and related services on the Lease
Schedule(s) attached hereto or incorporated herein by reference
from time to time (collectively, the equipment, software and
services are the “Equipment”), subject to the terms and
conditions hereof, as supplemented with respect to each item of
Equipment by the terms and conditions set forth in the appropriate
Lease Schedule. The term “Lease Agreement” shall
include this Lease Agreement and the various Lease Schedule(s)
identifying each item of Equipment or the appropriate Lease
Schedule(s) identifying one or more particular items of
Equipment.
This Lease Agreement is effective
from the date it is executed by both parties. The term of this
Lease Agreement, as to all Equipment designated on any particular
Lease Schedule, shall commence on the Installation Date for all
Equipment on such Lease Schedule and shall continue for an initial
period ending that number of months from the Commencement Date as
set forth in such Lease Schedule (the “Initial Term”)
and shall continue from year to year thereafter until terminated.
The term of this Lease Agreement as to all Equipment designated on
any particular Lease Schedule may be terminated without cause at
the end of the Initial Term or any year thereafter by either party
mailing written notice of its termination to the other party not
less than one-hundred twenty (120) days prior to such termination
date.
The Installation Date for each item
of Equipment shall be the day said item of Equipment is installed
at the Location of Installation, ready for use, and accepted in
writing by the Lessee. The Commencement Date for any Lease Schedule
is the first of the month following installation of all the
Equipment on the Lease Schedule, unless the latest Installation
Date for any Equipment on the Lease Schedule falls on the first day
of the month, in which case that is the Commencement Date. The
Lessee agrees to complete, execute and deliver a Certificate of
Acceptance to Lessor upon installation of the Equipment.
The lease charges for the Equipment
leased pursuant to this Lease Agreement shall be the aggregate
“Monthly Lease Charge(s)” as set forth on each and
every Lease Schedule executed pursuant hereto (the aggregate
“Monthly Lease Charge(s)” are the “Lease
Charges”). Lessee agrees to pay to Lessor the Lease Charges
in accordance with the Lease Schedule(s), and the payments shall be
made at Lessor’s address indicated thereon.
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The Lease Charges shall be paid by Lessee
monthly in advance with the first full month’s payment due on
the Commencement Date. The Lease Charge for the period from the
Installation Date to the Commencement Date (the “Installation
Period”) shall be an amount equal to the “Monthly Lease
Charge” divided by thirty (30) and multiplied by the number
of days from and including the Installation Date to the
Commencement Date and such amount shall be due and payable upon
receipt of an invoice from Lessor. Charges for taxes made in
accordance with Section 4 and charges made under any other
provision of this Lease Agreement and payable by Lessee shall be
paid to Lessor at Lessor’s address specified on the Lease
Schedule(s) on the date specified in invoices delivered to Lessee.
If payment, as specified above, is not received by Lessor on the
due date, Lessee agrees to and shall pay, to the extent permitted
by law, on demand, as a late charge, an amount equal to one and
one-half percent (1½ %), or the maximum percentage allowed by
law if less, of the amount past due (“Late Charges”).
Late Charges will accrue until billed by Lessor. Late Charges shall
be charged and added to any past due amount(s) on the date such
payment is due and every thirty (30) days thereafter until all past
due amounts are paid in full to Lessor.
In addition to the Lease Charges set
forth in Section 3, the Lessee shall reimburse Lessor for all
license or registration fees, assessments, sales and use taxes,
rental taxes, gross receipts taxes, personal property taxes and
other taxes now or hereafter imposed by any government, agency,
province or otherwise upon the Equipment, the Lease Charges or upon
the ownership, leasing, renting, purchase, possession or use of the
Equipment, whether the same be assessed to Lessor or Lessee (the
“Taxes”). Lessor shall file all property tax returns
and pay all Taxes when due. Lessee, upon notice to Lessor, may, in
Lessee’s own name, contest or protest any Taxes, and Lessor
shall honor any such notice except when in Lessor’s sole
opinion such contest is futile or will cause a levy or lien to
arise on the Equipment or cloud Lessor’s title thereto.
Lessee shall, in addition, be responsible to Lessor for the payment
and discharge of any penalties or interest as a result of
Lessee’s actions or inactions. Nothing herein shall be
construed to require Lessee to be responsible for any federal or
state taxes or payments in lieu thereof, imposed upon or measured
by the net income of Lessor, or state franchise taxes of Lessor, or
except as provided hereinabove, any penalties or interest resulting
from Lessor’s failure to timely remit such tax
payments.
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5.
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Delivery and
Freight Costs
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Lessee shall accept delivery of and
install the Equipment before such time as the applicable vendor
requires payment for such Equipment.
All transportation charges upon the
Equipment for delivery to Lessee’s designated Location of
Installation are to be paid by Lessee. All rigging, drayage
charges, structural alterations, rental of heavy equipment and/or
other expense necessary to place the Equipment at the Location of
Installation are to be promptly paid by Lessee.
Lessee agrees to pay for the actual
installation of the Equipment at Lessee’s site. Lessee shall
make available and agrees to pay for all costs associated with
providing a suitable place of installation and necessary electrical
power, outlets and air conditioning required for operating the
Equipment as defined in the Equipment manufacturer’s
installation manual or instructions. All supplies consumed or
required by the Equipment shall be furnished and paid for by
Lessee.
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On the day following the last day of
the lease term associated with a Lease Schedule (the “Return
Date”), Lessee shall cause and pay for the Equipment on that
Lease Schedule to be deinstalled, packed using the
manufacturer’s standard packing materials and shipped to a
location designated in writing by Lessor (the “Return
Location”). If the Equipment on the applicable Lease Schedule
is not at the Return Location within ten (10) days of the Return
Date, or Lessee fails to deinstall and ship the Equipment on the
Return Date, then any written notice of termination delivered by
Lessee shall become void, and the Lease Schedule shall continue in
accordance with this Lease Agreement. Irrespective of any other
provision hereof, Lessee will bear the risk of damage from fire,
the elements or otherwise until delivery of the Equipment to the
Return Location. At such time as the Equipment is delivered to the
Lessor at the Return Location, the Equipment will be at the risk of
Lessor.
Lessee, at its sole expense, shall
maintain the Equipment in good working order and condition. Lessee
shall enter into, pay for and maintain in force during the entire
term of any Lease Schedule, a maintenance agreement with the
manufacturer of the Equipment providing for continuous
uninterrupted maintenance of the Equipment (the “Maintenance
Agreement”). Lessee will cause the manufacturer to keep the
Equipment in good working order in accordance with the provisions
of the Maintenance Agreement and make all necessary adjustments and
repairs to the Equipment. The manufacturer is hereby authorized to
accept the directions of Lessee with respect thereto. Lessee agrees
to allow the manufacturer full and free access to the Equipment.
All maintenance and service charges, whether under the Maintenance
Agreement or otherwise, and all expenses, if any, of the
manufacturer’s customer engineers incurred in connection with
maintenance and repair services, shall be promptly paid by Lessee.
Lessee warrants that all of the Equipment shall be in good working
order operating according to manufacturer’s specification and
eligible for the manufacturer’s standard maintenance
agreement upon delivery to and inspection and testing by the
Lessor. If the Equipment is not free of physical defect or damage,
operating according to manufacturer’s specification, in good
working order and/or eligible for the manufacturer’s standard
maintenance agreement, then Lessee agrees to reimburse Lessor for
all costs, losses, expenses and fees associated with such equipment
and the repair or replacement thereof.
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9.
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Location,
Ownership and Use
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The Equipment shall, at all times,
be the sole and exclusive property of Lessor. Lessee shall have no
right or property interest therein, except for the right to use the
Equipment in the normal operation of its business at the Location
of Installation, or as otherwise provided herein. The Equipment is
and shall remain personal property even if installed in or attached
to real property. Lessor shall be permitted to display notice of
its ownership on the Equipment by means of a suitable stencil,
label or plaque affixed thereto.
Lessee shall keep the Equipment at
all times free and clear from all claims, levies, encumbrances and
process. Lessee shall give Lessor immediate notice of any such
attachment or other judicial process affecting any of the
Equipment. Without Lessor’s written permission, Lessee shall
not attempt to or actually: (i) pledge, lend, create a security
interest in, sublet, exchange, trade, assign, swap, use for an
allowance or credit or otherwise; (ii) allow another to use; (iii)
part with possession; (iv) dispose of; or (v) remove from the
Location of Installation, any item of Equipment. If any item of
Equipment is exchanged, assigned, traded, swapped, used for an
allowance or credit or otherwise to acquire new or different
equipment (the “New Equipment”) without Lessor’s
prior written
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fconsent, then all of the New Equipment shall
become Equipment owned by Lessor subject to this Lease Agreement
and the applicable Lease Schedule.
Any feature(s) installed on the
Equipment at the time of delivery which are not specified on the
Lease Schedule(s) are and shall remain the sole property of the
Lessor.
Lessee shall cause the Equipment to
be operated in accordance with the applicable vendor’s or
manufacturer’s manual of instructions by competent and
qualified personnel.
Lessor is hereby authorized by
Lessee to cause this Lease Agreement or other instruments,
including Uniform Commercial Code Financing Statements, to be filed
or recorded for the purposes of showing Lessor’s interest in
the Equipment. Lessee agrees to execute any such instruments as
Lessor may request from time to time.
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11.
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Alterations
and Attachments
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Upon prior written notice to Lessor,
Lessee may, at its own expense, make minor alterations in or add
attachments to the Equipment, provided such alterations and
attachments shall not interfere with the normal operation of the
Equipment and do not otherwise involve the pledge, assignment,
exchange, trade or substitution of the Equipment or any component
or part thereof. All such alterations and attachments to the
Equipment shall become part of the Equipment leased to Lessee and
owned by Lessor. If, in Lessor’s sole determination, the
alteration or attachment reduces the value of the Equipment or
interferes with the normal and satisfactory operation or
maintenance of any of the Equipment, or creates a safety hazard,
Lessee shall, upon notice from Lessor to that effect, promptly
remove the alteration or attachment at Lessee’s expense and
restore the Equipment to the condition the Equipment was in just
prior to the alteration or attachment.
Lessee shall assume and bear the
risk of loss, theft and damage (including any governmental
requisition, condemnation or confiscation) to the Equipment and all
component parts thereof from any and every cause whatsoever,
whether or not covered by insurance. No loss or damage to the
Equipment or any component part thereof shall impair any obligation
of Lessee under this Lease Agreement, which shall continue in full
force and effect except as hereinafter expressly provided. Lessee
shall repair or cause to be repaired all damage to the Equipment.
In the event that all or part of the Equipment shall, as a result
of any cause whatsoever, become lost, stolen, destroyed or
otherwise rendered irreparably unusable or damaged (collectively,
the “Loss”) then Lessee shall, within ten (10) days
after the Loss, fully inform Lessor in writing of such a Loss and
shall pay to Lessor the following amounts: (i) the Monthly Lease
Charges (and other amounts) due and owing under this Lease
Agreement at the time of the Loss, plus (ii) one-hundred twelve
(112%) percent of the original cost of the Equipment subject to the
Loss (or Event of Default, as defined hereinafter) amortized by the
Monthly Lease Charges received by Lessor during the Initial Term
using an amortization rate of 350 basis points over the interest
rate of the three (3) year United States Treasury Note as reported
by The Wall Street Journal on the Commencement Date (collectively,
the sum of (i) plus (ii) shall be the “Casualty Loss
Value”). Upon receipt by Lessor of the Casualty Loss Value:
(i) the applicable Equipment shall be removed from the Lease
Schedule; and (ii) Lessee’s obligation to pay Lease Charges
associated with the applicable Equipment shall cease. Lessor may
request, and Lessee shall complete, an affidavit(s) which swears
out the facts supporting the Loss of any item of
Equipment.
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Until the Equipment is returned to
Lessor or as otherwise herein provided, whether or not this Lease
Agreement has terminated as to the Equipment, Les