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6. SECURITY INTEREST; TITLE: Unless otherwise required by the law,
<br />upon the Commencement Date, legal title to the Equipment shall vest in
<br />Lessee subject to Lessor's rights hereunder, provided that title shall thereafter
<br />immediately and without any action by Lessee revest in Lessor, and Lessee
<br />shall immediately surrender possession of the System to Lessor, upon the
<br />occurrence of an Event of Default. Lessee shall execute any such
<br />instruments as Lessor may request to evidence such transfer. To secure
<br />Lessee's obligations under this Lease, Lessee hereby grants to Lessor a first
<br />priority security interest in Lessee's existing and future right, title and interest
<br />in the Lease and the System, which includes all additions, attachments,
<br />accessions, and leased Modifications and Additions (as defined in Section 7
<br />below) thereto and replacements therefor as well. as all proceeds of the
<br />foregoing including, without limitation, insurance proceeds, rents and all sums
<br />due or to become due to Lessee with respect to any of the foregoing, and all
<br />monies received in respect thereof and the Supplier Agreement.
<br />7. MODIFICATIONS; ADDITIONS; ALTERATIONS: After the
<br />Commencement Date of this Lease and without notice to Lessor, Lessee may,
<br />at Lessee's expense, alter or modify any item of. Equipment with an upgrade,
<br />accessory or any other equipment which meets, the specifications of the
<br />manufacturer of the System for use on or in connection with the System
<br />("Modification") or with Software or other associated items or materials which
<br />meet the specifications of the manufacturer of the System and are to be used
<br />on or in connection with the System ("Addition"). Any other modification or
<br />addition ("Alteration") shall be permitted only upon written notice to Lessor
<br />and at Lessee's expense and risk, and any such Alteration shall be removed
<br />and the Equipment restored to its normal, unaltered condition at Lessee's
<br />expense prior to its return to Lessor. If not .removed upon return of the
<br />System, any Modification or Addition shall become, without charge, the
<br />property of Lessor free and clear of all encumbrances. Restoration will
<br />include replacement of any parts removed in connection with the installation of
<br />an Alteration, Modification or Addition. Any Equipment or Software installed in
<br />connection with warranty or maintenance service or manufacturer's upgrades
<br />provided at no charge to Lessee shall be subject to this Lease.
<br />S. LEASES FOR MODIFICATIONS AND ADDITIONS: During, the Term of
<br />this Lease, at Lessee's_ request, , Lessor may elect to lease to Lessee
<br />Modifications and Additions . ("CSO Equipment") subject to the terms of this
<br />Lease. While the CSO Equipment shall be added.to and become a part of
<br />this Lease as of the CSO Commencement Date (as defined below), the CSO
<br />Lease Addendum shall be assigned a separate Schedule number. The lease
<br />for CSO Equipment shall expire at the same. time as this Lease. The
<br />applicable Lease Rate Factor shall be Lessors then -current -Lease, Rate
<br />Factor for similar transactions based upon the remaining length of the Term.
<br />The rent for CSO Equipment shall be determined by. Lessor who shall adjust
<br />the then -current Rent and notify Lessee in' writing of such adjustment(s),
<br />which shall be effective as of the first day of the month following the date of
<br />the notice (or the date of the notice if it is the first day of the month) ("CSO
<br />Commencement Date"). Any adjustment notice shall be added to and
<br />become a part of this Lease.
<br />CSO Equipment must be ordered by Lessee from the Supplier. On the date
<br />any CSO Equipment is delivered to Lessee, Suppplier shall pass title to such
<br />CSO Equipment ((other than any Software which shall be licensed and/or
<br />sublicensed) direcily to. Lessor. Such title shall. be good and marketable and
<br />free and clear of any and all. liens and encumbrances of. any nature
<br />whatsoever except Lessee's Interests hereunder. Lessor shallpromptl pay
<br />to Supplier the appropriate price of the CSO Equipment after the later of ro the
<br />date the CSO Equipment is Installed and functioning, or (ii) Lessor's receipt of
<br />a full and complete listing of.the CSO Equipment and the Supplier's invoice.
<br />No interest shall be payable by Lessor to Supplier with respect to such
<br />payment. Lessor's agreement to lease any,CSO Equipment is subject to the
<br />condition that the Price payable to Supplier with respect thereto shall not
<br />exceed $100,000.00 or be less than $1,000.00 and is subject to satisfactory
<br />credit review by Lessor of Lessee's credit.
<br />9. RETURN OF SYSTEM: (a) Upon any termination of this Lease pursuant
<br />to the terms hereof prior. to the end of the Term or, (b) at Lessor's request
<br />upon the occurrence of an Event of Default, Lessee shall, at its own risk and
<br />sole expense, immediately return the System to Lessor by properly removing,
<br />disassembling and packing it for shipment, loading it on board a carrier
<br />acceptable to Lessor, and .shipping the .same. to a destination in the
<br />continental United States specified by Lessor, freight and insurance prepaid.
<br />The returned System shall be in the same condition and operating order as
<br />existed when received, ordinary wear and tear excepted. If Lessee does not
<br />SLGSCHED 711"9 CADocuments and SettingstshadiADesktop\Indian River 002 County SLG $bo .doc
<br />immediately return the System to Lessor as required herein, Lessee shall pay
<br />to Lessor, upon demand, an amount equal to the then current Rent prorated
<br />on a daily basis for each day from and including the termination or expiration
<br />date of the Lease through and including the day Lessee ships the System to
<br />Lessor in accordance with this Section. Lessee shall pay to Lessor, upon
<br />written demand, any amount necessary, to place the System in good repair,
<br />condition and working order, ordinary wear and tear excepted.
<br />10. PURCHASE OPTION: Provided that there is no Event of Default,or an
<br />.event which with notice or lapse of time, or both, could become an'Event of
<br />Default, then existing and. continuing, upon payment by Lessee of $1.00 at, the
<br />end of the Term hereof. Lessor shall transfer, assign, and convey its interest
<br />in all of the Equipment to Lessee, and Lessor. shall assign, any nonexclusive
<br />sublicense to Lessee to use all of the Software. Lessee also shall be
<br />responsible for the payment of all sales taxes, transfer fees and other similar
<br />charges, if any, which may, arise in connection with Lessee's payment of the
<br />purchase price.
<br />Upon satisfaction by Lessee of such purchase conditions, Lessor's sole and
<br />exclusive obligation after payment of the purchase price shall be to deliver to
<br />Lessee any and all right,- title and interest it may have in and to such
<br />Equipment, such as Lessor shall have received from the Supplier, warranted
<br />only to be free and clear of all liens, encumbrances, rights, title and interests
<br />of others arising solely out of Lessor's actions, to release Lessor's security
<br />interests in the Equipment and to assign to Lessee a non-exclusive Software
<br />sublicense as described in the Supplier Agreement. Lessor's assignment of
<br />the sublicense is limited to such sublicense as Lessor can assign without
<br />incurring further cost and is subject to all applicable terms and conditions of
<br />the license and/or sublicense set forth in the Supplier Agreement: Lessee
<br />purchases the Equipment and receives the sublicense to use the Software
<br />AS -IS, WHERE -IS; WITH ALL FAULTS AND SUBJECT TO THE SAME
<br />DISCLAIMERS OF WARRANTIES AND DAMAGES AS SET FORTH IN THE
<br />LEASE.
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