Terms and Conditions

This EQUIPMENT LEASING AND PARTNERSHIP AGREEMENT (this “Agreement”) is hereby entered into as of <blank value> (the “Effective Date”), by and between Bubbleball, Inc. (together with its successors and assigns, “BubbleBall”) and <blank value><blank value> (together with its successors and assigns, “Lessee”).
 
WHEREAS, BubbleBall is in the business of providing certain sporting equipment for lease to third parties for use in connection with inflatable sphere sports and recreation activities; and 
 
WHEREAS, Lessee wishes to lease such sporting equipment for its provision of services to consumers.
 
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein along with other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
 
    1. Definitions.  Unless the context otherwise requires, capitalized terms used herein have the meanings provided in this Agreement.
 
    2. Delivery, Acceptance and Leasing of Equipment.  BubbleBall and Lessee hereby agree that (a) All Equipment and Each Item of Equipment (as such terms are defined on Schedule A hereto, which Schedule may be amended to add Items of Equipment from time to time) shall be delivered to Lessee within thirty (30) days of the date provided in Schedule A hereto; (b) Lessee shall inspect each such Item of Equipment so delivered and, unless it rejects such Item(s) of Equipment within five (5) days after receipt thereof, such items shall be deemed accepted by Lessee.
 
    3. Term
 
    3.1. The Term for the lease of each Item of Equipment shall commence on the Delivery Date thereof, and shall end on the date provided for the end of the Term on Schedule A, or on the date terminated if terminated by either party for any reason or no reason at all with respect to such Item (or all Equipment) pursuant to the provisions hereof, or if this Agreement is renewed with respect to such Item of Equipment pursuant to Section 22 hereof, on the last day of the last Renewal Term (if any, as such term is defined in Section 22 hereof) thereof, or on the date terminated if terminated during such Renewal Term by either party for any reason or no reason at all.
 
    3.2. Notwithstanding the foregoing and/or any other provision in this Agreement, in the event Lessee opts to pay royalties under Section 5.1.2 of this Agreement and the royalties paid to BubbleBall by Lessee are not equal to or greater than the Minimum Royalty Amount within the Minimum Royalty Period as defined on Schedule A after each of (i) the Effective Date and (ii) the first day of each Renewal Term (if any, as such term is defined in Section 22), BubbleBall may, in its sole discretion, terminate this Agreement and all title in the Equipment shall transfer to Lessee.
 
    4. Return of Equipment.
 
    4.1. Return Delivery.  Other than in connection with returns under Section 14 of this agreement (Warranties), upon the earlier termination of the Term and only if within ninety (90) days from the Effective Date with respect to each Item of Equipment, Lessee will, at its expense, dismantle, surrender and deliver possession of each Item of Equipment to BubbleBall at its address for Notice with a certificate executed by an officer of Lessee certifying that the Item of Equipment is in the condition required hereunder, a copy of an inventory list for each Item, all then current manuals for each Item.  At the time of such return to BubbleBall, each Item of Equipment (and each part or component thereof) shall (a) meet the original design specifications and operating standards of such Item, (b) be in as good operating condition, state of repair and appearance as when delivered to Lessee hereunder, ordinary wear and tear excepted, and in the condition required by Section 7 hereof, (c) have no missing or damaged components such that its value, utility or remaining useful life will be reduced, (d) comply with all laws and rules referred to in Section 7 hereof, (e) have attached or affixed thereto any addition, modification or improvement considered an accession thereto as provided in Section 8 hereof and (f) have had removed therefrom in a workmanlike manner any addition, modification or improvement which, as provided in Section 8 hereof, is owned by Lessee, and (g) be free and clear of all Liens, other than a Lien granted or placed thereon by BubbleBall, Lender, or any Assignee pursuant to Section 11 hereof.  Fees for any shipping, inspections, cleaning, repairs or restocking necessary to restore any Item of Equipment to the condition required by this Section 4.1. shall be deducted from the Deposit that is to be returned to Lessee, pursuant to Section 5.2., and shall be applied at the rates used by BubbleBall at the time of the Deposit return.  The term “ordinary wear and tear” as used herein shall not be construed as permitting any material broken, damaged or missing items or components of any Item of Equipment.  Upon redelivery, Lessee shall provide any additional documentation reasonably requested by BubbleBall, at BubbleBall’s cost, relating to the redelivery of or BubbleBall’s interest in each Item of Equipment.
 
    4.2. Holdover Equipment Payment.  Each Item of Equipment shall be deemed redelivered upon satisfaction of the obligations and conditions set forth in this Section 4 and Section 5.2  Until each such Item of Equipment has been returned to BubbleBall in the condition and as otherwise provided in this Section 4, Lessee shall continue to pay BubbleBall, on the same dates on which an Equipment Payment for such Item was payable during the Term thereof 125% of the Equipment Payment for such Item that was payable on the last Payment Date of the Term thereof; provided, that during such holdover period, Lessee shall use its best efforts to secure the return of the Equipment as required under this Section 4.  
 
    4.3. Specific Performance.  The provisions of this Section 4 are of the essence of this Agreement, and upon application to any court of equity having jurisdiction in the premises, BubbleBall shall be entitled to a decree against Lessee requiring specific performance of the covenants of Lessee set forth in this Section 4.
 
    5. Payments.
 
    5.1. Equipment Payment.  
 
    5.1.1. Lessee hereby agrees to pay BubbleBall a lease payment for each Item of Equipment within 30 days of the Delivery Date and each Month thereafter during the Term as payment for that month of the leasing of such Items of Equipment under this Agreement, in the amounts as defined on Schedule A hereto (an “Equipment Payment”).
 
    5.1.2. In the event Schedule A identifies the Equipment Payment as ROYALTY, Lessee hereby agrees to pay BubbleBall an additional Equipment Payment in the amount of the percentage identified multiplied by the gross revenues Lessee charges to third parties for participation in activities including the use of any of the Equipment during each billing month.  Such payment shall be due on the fifth (5th) day of each month for royalties earned during the previous month (or partial month for the month in which the Delivery Date falls) and shall be accompanied by a report identifying all billings for activities including the use of any of the Equipment during the relevant royalty period.
 
    5.1.3. If this Agreement is not terminated during the first twelve (12) months of the original Term, then as detailed in Section 22, the Lessee shall be responsible for Equipment Payments in the amount as defined in Section A and Equipment Payments shall be due and payable as defined in Section A so long as this Agreement is in full force and effect.  All Equipment Payments shall be the non-refundable property of BubbleBall.
 
    5.1.4. In the event of a royalty arrangement under Section 5.1.2, above, once annually, upon thirty (30) days’ prior notice, BubbleBall shall have the right to have certified public accountants audit Lessee’s accounting records during normal business hours as necessary to calculate the Equipment Payments due under this Agreement. Such audit shall be at BubbleBall’s expense unless it establishes undisputed accounting errors cumulatively resulting in overdue royalties exceeding five percent (5%) of the total sums accruing to BubbleBall during the calendar year(s) subject to the audit. In the event of such occurrence, Lessee shall bear the cost of the audit up to the amount due to BubbleBall plus interest measured from the time the amounts were due, and at the rate of the lesser of one and one-half percent per month or the maximum rate allowable by law, and shall pay any such amount due to BubbleBall within thirty (30) days after the auditor’s notice to Lessee of the deficiency. For purposes of this Section, an “accounting error” refers to a discrepancy between the amount due Lessee and the amount paid Contractor for such period as of the date the audit is requested.
 
    5.2. Deposit.  A deposit shall be required (as defined on Schedule A) and shall be due on the Effective Date of this Agreement.  The deposit shall be refunded within ninety (90) days after the Date of End of Term (as defined on Schedule A) if this Agreement is terminated within sixty (60) days of the Effective Date and each Item of Equipment has been returned to BubbleBall within sixty (60) days of the Effective Date.  If each Item of Equipment is not received within sixty (60) days of the Effective Date the deposit shall thereafter be the nonrefundable property of BubbleBall and all Items of Equipment, and all title in the Equipment shall transfer to Lessee.
 
    5.3. Method of Payment.  All Equipment Payments required to be made by Lessee to BubbleBall shall be made in immediately available funds.  In the event of any assignment to an Assignee pursuant to Section 9.2 hereof, all payments which are assigned to such Assignee shall be paid in such manner as shall be designated by BubbleBall or such Assignee.   Lessee may pay by credit card, but a copy of a voided check must be provided at the time such credit card information is provided.  Lessee agrees to authorize charge of such credit card immediately upon any amounts coming due under this Agreement.  Time is of the essence in connection with the payment of Equipment Payments, and Supplemental Payments.
 
    5.4. Late Payments.  Any payments due but not made to BubbleBall by the date due shall bear interest at the then current Prime Rate quoted by BubbleBall’s bank from the date such payments are due to the date of payment.  BubbleBall’s right to interest on late payments shall not preclude BubbleBall from exercising any of its other rights or remedies pursuant to this Agreement or otherwise with regard to Lessee’s failure to make timely remittances.  
 
    6. Use of Equipment; Compliance with Laws.  
 
    6.1. Lessee agrees that each Item of Equipment will be used and operated solely in the conduct of its business in the manner for which it was intended, in accordance with the license or certificate, if any, provided by the manufacturer thereof and in compliance with any and all insurance policy terms, conditions and provisions and with all laws applicable to the use and operation of the Equipment, including, without limitation, personal safety, environmental, noise and pollution laws (including notifications and reports).  Lessee shall procure and maintain in effect all licenses, registrations, certificates, permits, approvals and consents required by federal, national, state or local laws or by any governmental body, agency or authority in connection with the delivery, installation, use and operation of each Item of Equipment, including, without limitation, those required by environmental, noise and pollution laws (including notifications and reports) and including, where applicable, any and all registrations, permits, licenses, and all renewals thereof.  Lessee shall use reasonable precautions to prevent loss or damage to each Item of Equipment from fire and other hazards.  Lessee shall not permit any Item of Equipment to be used in any unlawful trade or in any manner that would violate any law that would expose such Item of Equipment to penalty, forfeiture or capture.
 
    6.2. Lessee represents and warrants that it shall not permit (i) the improper use of the Equipment and/or any Item of Equipment; and/or (ii) any use of the Equipment and/or any Item of Equipment that endangers the life and/or health of any user; and/or (iii) any unreasonable use of the Equipment and/or any Item of Equipment.
 
    7. Maintenance and Repair of Equipment.  Unless otherwise provided in this Agreement, Lessee agrees, at its own cost and expense, to keep, repair, maintain, service and preserve the Equipment in good repair, operating and serviceable condition and shall keep the Equipment in order and condition equal to or better than other equipment of the same type owned by Lessee, and in compliance with all requirements of applicable laws. 
 
    8. Exclusivity.  Lessee agrees that BubbleBall shall be Lessee’s exclusive supplier of equipment of the nature and type leased hereunder during the Term of this Agreement, and Lessee will not, directly or indirectly, though any employee, agent, or otherwise, solicit, initiate or encourage, leasing and/or purchase of similar equipment from any other vendor during such Term.
 
    9. Trademark License.  
 
    9.1. Grant.  BubbleBall hereby grants to Lessee a limited, nonexclusive, non-assignable, non-sublicenseable license to use the BubbleBall Marks in the Territory (as defined on Schedule A) solely in the forms provided on Schedule B hereto (the “Licensed Marks”), solely during the Term of this Agreement, and solely while Lessee is using the Items of Equipment exclusively without the use of similar equipment supplied by third parties.  
 
    9.2. Ownership.  Lessee acknowledges that, as between BubbleBall and the Lessee, BubbleBall is the sole owner of all right, title and interest in and to the Licensed Marks.  Lessee has not acquired, and shall not acquire, any right, title or interest in or to any of the Licensed Marks except the limited rights with respect to such Licensed Marks expressly set forth in this Agreement.  All rights of BubbleBall in and to the Licensed Marks not expressly granted in this Agreement are reserved by BubbleBall.  As between BubbleBall and Lessee, all use of the Licensed Marks by the Lessee, and all goodwill associated with such use, shall inure to the benefit of BubbleBall.  Lessee acknowledges that except for the limited license to use the Licensed Marks as provided in the Agreement, Lessee acquires no right to use any mark, device, or trade dress confusingly similar to or dilutive of the Licensed Marks.  Lessee shall not challenge the validity of the Licensed Mark, BubbleBall’s ownership thereof, and/or the enforceability of BubbleBall’s rights therein.
 
    9.3. Confusing Marks.  Other than as authorized by this Agreement, Lessee shall not use, register, own, claim to own or claim any right or interest in, any of the Licensed Marks and shall not use, register, own, claim to own or claim any right or interest in, any service mark, service name, trade name, trademark, domain name, brand, mark, word, translation, combination, abbreviation, logo or design confusingly similar to or incorporating any of the Licensed Marks. Without limiting the foregoing, Lessee agrees that, should Lessee or its affiliates, directly or indirectly, ever use or acquire any ownership, registration, right, or interest in or to any such service mark, service name, trade name, trademark, domain name, design or logo incorporating or confusingly similar to any of the Licensed Marks, before, during or after the Term of this Agreement, Lessee or its affiliates, as applicable, shall promptly assign and transfer and hereby does assign and transfer to BubbleBall, without any additional consideration, all such rights, registrations, and all goodwill associated therewith, and Lessee agrees that any further use thereof shall be subject to all the terms and conditions of this Agreement. 
 
    9.4. No Tarnishing or Denigration.  Lessee shall not, and shall not permit, allow, or cause others, through any act, omission, right, or obligation, to tarnish, disparage, denigrate, degrade or dilute any of the Licensed Marks, use any of the Licensed Marks in connection with any activity that is illicit, immoral, unethical, or would constitute or cause the existence of a violation of law by BubbleBall and/or Lessee, or would be harmful or damaging or potentially harmful or damaging to the reputation and goodwill of BubbleBall and/or Lessee.
 
    9.5. Domain names.  During the term of this Agreement, Lessee may use domain names incorporating the Licensed Marks subject to BubbleBall’s prior written approval to be granted or withheld in its sole discretion.  Ownership of any domain names incorporating any of the Licensed Marks registered by Lessee shall be assigned to BubbleBall at its request.  On any website Lessee uses in connection with the use of Equipment, Lessee shall include a link to BubbleBall’s site, www.bubbleball.us, or such other site as instructed by BubbleBall, in a form, placement, and size as instructed by BubbleBall in its sole reasonable discretion.
 
    9.6. Quality Control.  Lessee acknowledges that the Licensed Marks are associated in the minds of consumers with first-class goods and services of high quality.  BubbleBall entered into this Agreement based on Lessee’s representations that Lessee will take such actions as are necessary to preserve such brand image and quality. All services Lessee provides shall meet, at a minimum, a level of quality comparable to the quality standards generally accepted for other first-class brands of similar products and services in the same industry.  Lessee specifically acknowledges that appropriate brand positioning is of paramount importance to BubbleBall in its management of the Licensed Marks, and that any failure by Lessee to abide by the terms of this Section 9.6 shall be deemed a material breach of this Agreement by Lessee and will cause irreparable damage to BubbleBall’s business, which also employs any of the Licensed Marks and/or related marks.  If BubbleBall discovers any use of any of the Licensed Marks that, in BubbleBall’s sole reasonable opinion, is improper or inconsistent with the Agreement, and BubbleBall delivers a writing describing in detail the nature of such use to Lessee, Lessee shall remedy such use, within thirty (30) days after receipt of such writing, to the reasonable satisfaction of BubbleBall, by informing BubbleBall of the changed or discontinued use, which BubbleBall may accept or deny in its sole discretion.
 
    10. Assignment and Subleasing.
 
    10.1. By Lessee.  EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS SECTION 10, LESSEE WILL NOT, WITHOUT THE PRIOR WRITTEN CONSENT OF BUBBLEBALL, LEASE ANY ITEM OF EQUIPMENT, OR ASSIGN, TRANSFER OR ENCUMBER ITS RIGHTS, INTERESTS OR OBLIGATIONS HEREUNDER.  ANY ATTEMPTED LEASE IN VIOLATION HEREOF AND ANY ASSIGNMENT, TRANSFER OR ENCUMBERING BY LESSEE OF ITS RIGHTS, INTERESTS OR OBLIGATIONS HEREUNDER IN VIOLATION HEREOF SHALL BE NULL AND VOID.  Lessee may, without BubbleBall’s consent, lease any Item of Equipment to subsidiaries of Lessee in the ordinary course of business.  Any such lease or financing agreement (together will all amendments, modifications and supplements thereto, a “Subsidiary Equipment Agreement”) shall be, and shall expressly state that it is, subject and subordinate in all respects to this Agreement and the rights of BubbleBall (and any Assignee) hereunder including BubbleBall’s right to possession of the Equipment upon an Event of Default (as that term is defined below), shall prohibit subleasing, shall not have a term that may exceed the remaining portion of the Term of such Item of Equipment, and shall be secured by a first priority security interest granted by such subsidiary in favor of Lessee, which security interest shall be a perfected security interest for all Equipment located in the United States.  In such event of a sublease to a subsidiary, Lessee shall promptly deliver to BubbleBall the original counterpart of each Subsidiary Agreement and shall provide prompt notice to BubbleBall (including the name and address of the lessee) of any lease or sublease to or financing agreement with a third party having a term coterminous with the then current Term of the Items of Equipment subject to such lease, sublease or financing agreement.  No such leasing by Lessee will reduce any of the obligations of Lessee hereunder or the rights of BubbleBall (and any Assignee) hereunder, and all of the obligations of Lessee hereunder shall be and remain primary and shall continue in full force and effect as the obligations of a principal and not of a guarantor or surety.
 
    10.2. By BubbleBall.  BubbleBall may sell, assign, transfer or grant a security interest in all or any part of BubbleBall’s rights, obligations, title or interest in, to and under the Equipment or any Item(s) thereof, this Agreement, and/or any Equipment Payments payable under this Agreement without Lessee’s consent. Any entity to whom any such sale, assignment, transfer, or grant of security interest is made is herein called an “Assignee” and any such sale, assignment, transfer or grant of security interest is herein called an “assignment”.  An Assignee may re-assign and/or grant a security interest in any of such rights, obligations, title or interest assigned to such Assignee without Lessee’s consent.  Lessee agrees to execute related acknowledgments and other documents that may be reasonably requested by BubbleBall or an Assignee.  Each Assignee shall have and may enforce all of the rights and benefits of BubbleBall hereunder with respect to the Item(s) of Equipment covered by the assignment.  Each such assignment shall be subject to Lessee’s rights hereunder so long as no Event of Default has occurred and is continuing.  Lessee shall be under no obligation to any Assignee except upon written notice of such assignment from BubbleBall or, in the case of a reassignment, from the Assignee.  Upon written notice to Lessee of an assignment in accordance with this Section 10.2, Lessee agrees to pay the Equipment Payments with respect to the Item(s) of Equipment covered by such assignment to such Assignee in accordance with the instructions specified in such notice without any abatement, defense, setoff, counterclaim or recoupment whatsoever, and to otherwise comply with all notices, directions and demands which may be given by BubbleBall or such Assignee with respect to such Item(s), in accordance with the provisions of this Agreement. Notwithstanding any such assignment, all obligations of BubbleBall to Lessee under this Agreement shall be and remain enforceable by Lessee against BubbleBall and any Assignee to whom an assignment has been made.
 
    11. Liens.  Lessee will not directly or indirectly create, incur, assume or suffer to exist any liens, mortgages, encumbrances, pledges, charges and security interests (any/each/all a “Lien”) of any kind on or with respect to (a) any Item of Equipment or any part thereof, BubbleBall’s title thereto, or any interest therein or proceeds thereof, or (b) this Agreement or any of BubbleBall’s interests hereunder, except (i) Permitted Liens or (ii) any Lien granted or placed thereon by BubbleBall, any BubbleBall lender, or any Assignee pursuant to this Section 11 or any person with a claim against BubbleBall or any Assignee.  Lessee, at its own expense, will promptly pay, satisfy and otherwise take such actions as may be necessary to keep this Agreement and each Item of Equipment free and clear of, and to duly discharge or eliminate or bond in a manner satisfactory to BubbleBall and each Assignee, any such Lien not excepted above if the same shall arise at any time. Lessee will notify BubbleBall and each Assignee in writing promptly upon becoming aware of any tax or other Lien (other than any Lien excepted above) that shall attach to the Equipment or any Item of Equipment, and of the full particulars thereof.
 
    12. Loss, Damage or Destruction.
 
    12.1. Risk of Loss, Damage or Destruction.  Except as otherwise provided in this Agreement, Lessee hereby assumes all risk of loss, damage, theft, taking, destruction, confiscation, requisition or commandeering, partial or complete, of or to each Item of Equipment, however caused or occasioned, such risk to be borne by Lessee with respect to each Item of Equipment from the date of this Agreement.  Lessee agrees that no occurrence specified in the preceding sentence shall impair, in whole or in part, any obligation of Lessee under this Agreement, including, without limitation, the obligation to pay Equipment Payments.
 
    12.2. Payment Upon an Event of Loss.  “Event of Loss” with respect to any Item of Equipment means (a) the loss of such Item of Equipment or any substantial part thereof, or (b) the loss of the use of such Item of Equipment due to theft or disappearance for a period in excess of forty-five (45) days during the Term, or existing at the expiration or earlier termination of the Term, or (c) the destruction, damage beyond repair, or rendition of such Item of Equipment or any substantial part thereof permanently unfit for normal use for any reason whatsoever, or (d) the condemnation, confiscation, seizure, or requisition of use or title to such Item of Equipment or any substantial part thereof by any governmental entity.  If an Event of Loss occurs with respect to an Item of Equipment during the Term thereof, Lessee shall give BubbleBall prompt written notice thereof and shall, unless such condition is covered by any warranty of BubbleBall under this Agreement, pay to BubbleBall the sum of (a) all unpaid payments payable for such Item of Equipment for the entire Term, plus (b) the reasonable value of such Items of Equipment.  Any payments received at any time by BubbleBall or by Lessee from any insurer or other party (except Lessee) as a result of the occurrence of such Event of Loss will be applied in reduction of Lessee’s obligation to pay the foregoing amounts, if not already paid by Lessee, or, if already paid by Lessee, will be applied to reimburse Lessee for its payment of such amount, unless an Event of Default shall have occurred and be continuing.  Upon payment in full of all such amounts due, (a) the obligation of Lessee to pay hereunder with respect to such Item of Equipment shall terminate and the Term of such Item shall terminate, and (b) BubbleBall shall renounce all title and rights to such Item of Equipment.
 
    12.3. Application of Payments Not Relating to an Event of Loss.  Any payments (including, without limitation, insurance proceeds) received at any time by BubbleBall or Lessee from any other party with respect to any loss or damage to any Item or Items of Equipment not constituting an Event of Loss, will be applied directly in payment of repairs or for replacement of property in accordance with the provisions of Sections 7 and 8 hereof, if not already paid by Lessee, or if already paid by Lessee and no Event of Default shall have occurred and be continuing, shall be applied to reimburse Lessee for such payment, and any balance remaining after compliance with the provisions of said Sections with respect to such loss or damage shall be retained by Lessee.  If any Event of Default shall have occurred and is continuing, all payments hereunder shall be paid to BubbleBall or its Assignee in accordance with Section 12.2 hereof.
 
    13. Insurance.  Lessee may cause to be carried and maintained, at its sole expense, with respect to each Item of Equipment at all times during the Term thereof and for the geographic area in which such Item is at any time located, (a) physical damage insurance (including theft insurance) insuring against all risks of physical loss or damage to the Equipment (“Property Insurance”), and/or (b) insurance against liability for bodily injury, death and property damage resulting from the use and operation of the Equipment (“Liability Insurance”).  
 
    14. Warranties.
 
    14.1. Defective Equipment; Assignment of Manufacturer Warranties.  So long and only so long as an Event of Default shall not have occurred and be continuing, and so long and only so long as the Equipment shall be subject to this Agreement and Lessee shall be entitled to possession of the Equipment hereunder, BubbleBall authorizes Lessee, at Lessee’s expense, to assert for BubbleBall’s account, all rights and powers of BubbleBall under any manufacturer’s, vendor’s or dealer’s warranty on the Equipment or any part thereof and BubbleBall agrees to use reasonable efforts at Lessee’s expense to assist Lessee in obtaining the benefits of such warranties; provided, however, that Lessee shall indemnify, protect, save, defend and hold harmless BubbleBall from and against any and all claims, and all costs, expenses, damages, losses and liabilities incurred or suffered by BubbleBall in connection therewith, as a result of, or incident to, any action by Lessee pursuant to the foregoing authorization.
 
    14.2. Additional Warranty. In addition to the manufacturer warranty, BubbleBall shall provide the additional warranty to Lessee as described on Schedule A hereto.
 
    14.3. NO ADDITIONAL BUBBLEBALL WARRANTIES.  EXCEPT AS OTHERWISE PROVIDED UNDER SECTION 14 (WARRANTIES) AND ON SCHEDULE A, BUBBLEBALL HEREBY LEASES THE EQUIPMENT FOR LESSEE AS IS, WHERE-IS, WITH ALL FAULTS AND IN WHATEVER CONDITION IT MAY BE IN, AND EXPRESSLY DISCLAIMS AND MAKES NO REPRESENTATION OR WARRANTY, EITHER EXPRESSED OR IMPLIED, AS TO THE DESIGN, CONDITION, QUALITY, CAPACITY, MERCHANTABILITY, DURABILITY, SUITABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF, OR ANY OTHER MATTER CONCERNING, THE EQUIPMENT.  LESSEE HEREBY WAIVES ANY CLAIM (INCLUDING ANY CLAIM BASED ON STRICT OR ABSOLUTE LIABILITY IN TORT OR INFRINGEMENT) IT MIGHT HAVE AGAINST BUBBLEBALL FOR ANY LOSS, DAMAGE (INCLUDING INCIDENTAL OR CONSEQUENTIAL DAMAGE) OR EXPENSE CAUSED BY THE EQUIPMENT OR BY LESSEE’S LOSS OF USE THEREOF FOR ANY REASON WHATSOEVER, INCLUDING BUT NOT LIMITED TO COMPLIANCE WITH LAWS (WHICH ITEMS OF EQUIPMENT, LESSEE ACKNOWLEDGES, WERE SELECTED BY LESSEE ON THE BASIS OF ITS OWN JUDGMENT WITHOUT RELIANCE ON ANY STATEMENTS, REPRESENTATIONS, GUARANTIES OR WARRANTIES MADE BY BUBBLEBALL).  Some jurisdictions do not permit the disclaimer of certain implied warranties, so some of the foregoing may not be applicable.  To the extent that BubbleBall may not, as a matter of applicable law, disclaim any warranty, the scope and duration of such warranty shall be the minimum permitted under applicable law.  No advice or information, whether oral or written, obtained by Lessee from BubbleBall shall create any warranty not expressly made herein.
 
    15. Confidentiality.  Lessee understands that in connection with the equipment provided hereunder, BubbleBall may supply Lessee with confidential business information, regardless of whether marked or described as such.  This confidential information includes, without limitation, information regarding BubbleBall’s business and/or operation of BubbleBall activities that BubbleBall provides or otherwise makes available to Lessee, BubbleBall intellectual property, BubbleBall ideas, this Agreement, and the terms and conditions herein.  Lessee agrees that all confidential information will be treated in the same fashion that Lessee treats its own most confidential information, but in no event will Lessee treat such information with less than a commercially reasonable standard of care.  Lessee will not disclose, communicate, or otherwise permit the transfer of such confidential information to any third parties unless Lessee obtains the prior written consent of BubbleBall, or unless such information has become public or generally known by means other than the breach of this Agreement.  Lessee will not use such confidential information for any purpose other than those purposes contemplated by this Agreement and shall not use any such confidential information after the termination of this Agreement; provided, however, that Lessee may disclose confidential information to the extent necessary as legally required by law, legal process, or a governmental entity with competent jurisdiction.  Lessee agrees that the unauthorized use or disclosure of confidential information is likely to cause injury that is not readily measurable in monetary damages, and therefore irreparable.  Immediately upon BubbleBall’s request, and in any event no later than the termination or expiration of this Agreement, Lessee will return all materials containing and/or embodying BubbleBall’s confidential information.
 
    16. Events of Default.  Any of the following events shall constitute an Event of Default:
 
    (a)        Lessee shall fail to make any payment due under this Agreement within thirty (30) days after the same is due and payable; or
 
    (b) Lessee shall fail to perform or observe any material covenant, condition, or agreement to be performed or observed by it under this Agreement, and such failure shall continue unremedied for thirty (30) days after written notice to Lessee specifying such failure and demanding the same to be remedied; or
 
    (c)        Lessee shall become insolvent; or Lessee or any subsidiary thereof shall make an assignment for the benefit of creditors or consent to the appointment of a trustee or receiver; or a trustee or a receiver shall be appointed for Lessee or any subsidiary thereof or for a substantial part of the property of Lessee or any subsidiary thereof without its consent and shall not be dismissed for a period of sixty (60) days; or any petition for the relief, reorganization or arrangement of Lessee or any subsidiary thereof or any other petition in bankruptcy or for the liquidation, insolvency or dissolution of Lessee or any subsidiary thereof, shall be filed by or against Lessee or any subsidiary thereof and, if filed against Lessee or any subsidiary thereof, shall be consented to or be pending and not dismissed for a period of sixty (60) days, or an order for relief under any bankruptcy or insolvency law shall be entered by any court or governmental entity of competent jurisdiction with respect to Lessee or any subsidiary thereof; or any execution or writ or process shall be issued under any action or proceeding against Lessee or any subsidiary thereof whereby any of the Equipment may be taken or restrained and such execution or writ or process is not stayed within sixty (60) days; or Lessee’s corporate existence shall cease; or
 
    (d)         any representation, warranty, statement or certification made by Lessee under this Agreement, or pursuant hereto shall prove to be untrue or incorrect when made (or deemed made) except for inaccuracies or misstatements when made (or deemed made) that would not have a material effect on Lessee’s ability to fulfill its obligations under this Agreement.
 
    17. Remedies Upon Default.  Upon the occurrence of any Event of Default and at any time thereafter so long as the same shall be continuing, BubbleBall may exercise any other right or remedy which may be available to it under Applicable Law or proceed by appropriate court action to enforce the terms hereof or to recover damages for the breach hereof or to rescind this Agreement.
 
    In addition, Lessee shall be liable for all costs and expenses, including reasonable attorneys’ fees and costs, incurred by BubbleBall or any Assignee by reason of the occurrence of any Event of Default or the exercise of BubbleBall’s remedies with respect thereto. To the extent permitted by applicable law, Lessee hereby waives any rights now or hereafter conferred by statute or otherwise which may require BubbleBall to sell, lease or otherwise use the Equipment in mitigation of BubbleBall’s damages as set forth in this Section 17 or which may otherwise limit or modify any of BubbleBall’s rights and remedies in this Section 17.
 
    18. BubbleBall’s Right to Perform for Lessee.  If Lessee fails to perform or comply with any of its agreements contained herein, BubbleBall may itself, after notice to Lessee, make such payment or perform or comply with such agreement, and the amount of such payment and the amount of the reasonable expenses of BubbleBall incurred in connection with such payment or the performance of or compliance with such agreement, as the case may be, together with interest thereon at the rate specified in Section 19 hereof, shall, if not paid by Lessee to BubbleBall on demand, be payable to BubbleBall hereunder;  provided, however, that no such payment, performance or compliance by BubbleBall shall be deemed to cure any Event of Default hereunder.
 
    19. Late Charges.  Lessee shall pay to BubbleBall, upon demand, to the extent permitted by Applicable Law, interest on any payments due under this Agreement, for any period for which any of the same is overdue (without regard to any grace period) at a rate equal to the lesser of (a) 1.5% per month and (b) the maximum rate of interest permitted by law.
 
    20. Notices.  All notices or other communications under the Agreement shall be in writing, sent by trackable mail or email, and shall be deemed given when received at the address(es) below or such other address provided pursuant to this Section 20.
 
    If to BubbleBall:
 
Address: 213 Tall Oak, Irvine, CA 92603
Email:  sales@bubbleball.us
Attention:  CEO
 
    If to Lessee:
 
Address: <blank value>, <blank value> <blank value> <blank value>
Email: <blank value>
Attention: <blank value> <blank value>
 
    21. Additional Lessee Benefits.  In addition to the obligations and benefits otherwise described in this Agreement, during the Term and unless an Event of Default occurs and/or continues, BubbleBall shall to the extent reasonable:
 
    (a) replace defective Equipment at no additional cost to Lessee beyond shipping and handling;
 
    (b) provide and maintain a central BubbleBall website and a link to Lessee’s website;
 
    (c) provide consultation as needed by Lessee on business development and operational activities
 
    (d) provide know how and research on new games and revenue generating activities; and
 
    (e) provide Lessee with first access to new product lines and enhancements.
 
    22. Lessee’s Renewal. If no Event of Default shall have occurred and be continuing and this Agreement shall not have been earlier terminated, Lessee shall be entitled, at its option, to renew this Agreement with respect to all but not less than all Items of Equipment then subject to this Agreement.  Each Renewal Term shall be for the same duration as the original Term.  The first Renewal Term with respect to each such Item of Equipment will commence at the expiration of the Term of such Item, and each succeeding Renewal Term will commence at the expiration of the next preceding Renewal Term.  All of the provisions of this Agreement shall be applicable during each Renewal Term for each such Item of Equipment.  Lessee hereby agrees to pay BubbleBall an Equipment Payment for each Item of Equipment during each Renewal Term for which Lessee exercises its renewal option therefor in an amount equal to the Equipment Payment required during the previous Term plus an escalation of 20%.  If, with respect to any Renewal Term, Lessee intends to not exercise said renewal option, Lessee shall give written notice to BubbleBall to such effect at least five (5) days prior to the expiration of the then current Term and/or Renewal Term as the case may be of the Item(s) of Equipment whose initial Term first expires hereunder.  If Lessee fails to give such written notice to BubbleBall with respect to any of said Renewal Terms, it shall be conclusively presumed that Lessee has irrevocably elected to exercise said renewal option with respect to all Items of Equipment for said Renewal Term.  In the event Lessee elects not to exercise said renewal option and pursuant to section 5.2 with respect to all Items of Equipment, all title in the Equipment shall transfer to Lessee.
 
    23. Indemnification.  Lessee hereby agrees to indemnify, defend, and hold BubbleBall harmless from and against any claim by any third party arising from (i) Lessee’s use, and/or permitting third party use, of the equipment in any manner; and/or (ii) any negligent, reckless, or intentional act of Lessee; and/or (iii) Lessee’s breach of any of its representations, warranties, covenants, and/or other obligations provided in this Agreement.
 
    24. Disputes. This Agreement and the rights and obligations of the parties hereunder shall be construed in accordance with, and be governed by, the law of the State of California.  The parties hereto hereby agree that all actions or proceedings initiated by any party hereto arising directly or indirectly out of this Agreement shall be litigated in the state courts located in the State of California or the federal courts located in the Southern District of California.  Each party hereto hereby expressly submits and consents in advance to such jurisdiction and venue in any action or proceeding commenced by any party hereto in any of such courts, agrees that jurisdiction and venue is proper in such courts, and hereby waives personal service of the summons and complaint, or other process or papers issued therein, and agrees that such service of the summons and complaint may be made by registered mail, return receipt requested, addressed to the party hereto being served at the address for such party set forth in herein.  Each party hereto waives any claim that any such forums an inconvenient forum or an improper forum based on lack of venue.  Each of Lessee and BubbleBall hereby waives trial by jury in any judicial proceeding for any matter in any way arising out of, related to, or connected with this Agreement.  In any action to enforce, arising out of, and/or relating to this Agreement, the prevailing party as determined by the court or other body with jurisdiction by agreement of the parties shall be entitled to recover, in addition to all other remedies and awards to which it is entitled, its reasonable attorneys’ fees and costs incurred in connection therewith.
 
    25. Miscellaneous.
 
    25.1. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating or diminishing BubbleBall’s rights under the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.  To the extent permitted by Applicable Law, Lessee hereby waives any provision of law which renders any provision of this Agreement prohibited or unenforceable in any respect. All of the covenants, conditions and obligations contained in this Agreement shall be binding upon and shall inure to the benefit of the respective permitted successors and assigns of BubbleBall and Lessee.  This Equipment Agreement and the other Operative Documents, and each related instrument, document, agreement and certificate, collectively constitute the complete and exclusive statement of the terms of the agreement between BubbleBall and Lessee with respect to the acquisition and leasing of the Equipment, and cancel and supersede any and all prior oral or written understandings with respect thereto.
 
    25.2. The following Sections of this Agreement shall survive termination of the Agreement: 4-8, 9.2, 9.3, 9.4, 10, 12, 14, 17, 18, and 23-25.
 
    25.3. Except as otherwise expressly provided and subject to the rights assigned by Lessee and/or BubbleBall, neither this Agreement, nor any terms hereof may be amended, supplemented, waived or modified without the written agreement and consent of the parties.
 
    IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized representatives as of the date first above written. 
 
BUBBLEBALL:
 
BubbleBall Inc.
Name: Mahdad Taheri
Title: CEO
 
LESSEE:
 
Organization: <blank value>
Name: <blank value> <blank value>
Title: <blank value>

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