LEASE AGREEMENT ENTERED INTO, BY AND BETWEEN EQUIPOS CLIMATEC,
S.A. DE C.V., REPRESENTED BY ITS ATTORNEY-IN-FACT MSSRS. XXXXXX
X. XXXXXXX AND XXXXX X. XXXXXXXX (HEREINAFTER REFERRED TO AS THE
"LESSOR" AND BY THE OTHER PART OPTRON DE MEXICO, S.A. DE C.V.,
REPRESENTED BY ITS ATTORNEY--IN-FACT XX. XXXXX X. XXXXX
(HEREINAFTER REFERRED TO AS THE "LESSEE"), PURSUANT TO THE
FOLLOWING STATEMENMTS AND CLAUSES:
S T A T E M E N T S
I. The LESSOR states, through its legal representative:
a) That it is a Mexican Commercial stock corporation incorporated
in accordance to the General Law of Commercial Corporations.
EQUIPOS is the owner of the entire beneficial interest in the
property and the building situated thereon through two different
Real Estate trust agreements which are effective for thirty-year
terms and renewals for additional thirty-year terms.
b) That it is the owner and has full possession and domain of an
industrial plant with an approximate surface area of 5,400 square
meters (approximately 58,125 square feet), constructed on a plot
with surface of 19,568.43 square meters (approximately
210,634.50 square feet), located in the Rio Bravo Industrial
Park, in the City of Zargoza, Municipality of Xxxxxx, Bravos
District, State of Chihuahua, Mexico, which characteristics are
illustrated in the plot plan and plan of premises which are
attached to this contract as Exhibit "A". (The aforementioned
will be hereinafter referred to as the "Real Estate" or the
"Premises").
c) That it has the intention to lease the Real Estate, to the
LESSEE pursuant to the terms and conditions set forth in this
instrument.
d) That its representative has legal capacity for the execution
of this instrument on behalf of the LESSOR, same which has not
been limited nor revoked.
e) That the LESSOR has legal capacity to enter into this lease
pursuant to the permit attached hereto as Exhibit "B".
II. The LESSEE through its legal representative states:
a) That is a commercial stock corporation incorporated in
accordance to the General Law of Commercial Corporations.
b) That its objective is to operate light and clean industry.
c) That it wishes to lease the Real Estate pursuant to the terms
and conditions set forth herein.
d) That its legal representative has legal capacity for the
execution of this contract on behalf of the LESSEE, which has not
been limited nor revoked.
e) That the LESSEE has legal capacity to enter into this Lease.
III. Both parties state:
That upon the execution of this instrument there existed no
error, misrepresentation nor bad faith between them. Having
stated the foregoing, the parties hereby covenant and agree to
the following:
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C L A U S E S:
SECTION I
LEASE
1.1. The LESSOR hereby grants to the lessee the temporary use and
enjoyment of the Real Estate. 1.2. The LESSEE accepts and
receives the Real Estate in lease, pursuant to the terms and
conditions set forth herein.
SECTION 2
TERM
2.1. Provided there is no uncured Event of Default and subject
to the terms, covenants, agreements and conditions contained
herein, this Lease Agreement shall be for a term, binding for
both parties, commencing as of the date of execution hereof and
ending on December 31, 1996, at 11:59 p.m., Mexico city, Federal
District time.
2.2. This Lease Agreement may be extended for an additional five
(5) consecutive terms of one year each, which extensions shall be
exercised by the LESSEE by providing to the LESSOR a previous and
written notice duly delivered, at least one hundred and eighty
(180) days prior to the expiration date of this Agreement,
expressing its intention to extend this Lease Agreement. In the
event that LESSEE does not exercise its option to extend the Term
of this Lease for the next available one year term, then all
rights and options of LESSEE to extend the term shall cease and
LESSOR shall have the right during the remainder of the term to
advertise, in any manner, the availability of the Premises for
reletting.
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SECTION 3
USE OF THE REAL ESTATE
3.1. The LESSEE shall use the Real Estate only for light and
clean industrial purposes, such as the assembly or manufacture of
all kinds of products, excluding basic chemical production
and heavy industry, being forbidden expressly to use the Real
Estate for basic chemical production, heavy industry, fabrication
or storage of explosive, radioactive, inflammable (except as
needed in day to day operations), explosive products or any other
product which may be dangerous to persons or the integrity of the
Real Estate. LESSEE shall comply with the Mexican law of
Ecological Balance and Environmental Protection and Health Law.
LESSEE states that it has the intention of manufacturing
electrical and electronic products, activity that is considered a
light and clean industrial operation. Therefore, the LESSEE
represents that the intended use of the Premises is according to
the provisions set forth above. Notwithstanding any other
provision of this Lease, LESSOR retains a right to ingress,
egress, and access over and across the Premises for the benefit
of other parts of the Property or other Real Estate in
which LESSOR or its successor or Affiliates may have an interest.
SECTION 4
RENT
4.1. The LESSEE shall pay to the LESSOR for this Lease the rental
amount of $70,143.25 (Seventy Thousand One Hundred Forty-three
and 25/loo Dollars), legal currency of the United States of
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America, or pesos if required by Mexican law, in advance for the
space occupied or the period thru December 31, 1991. Beginning
January l, 1992 the LESSEE shall pay $4.50 (Four and 50/100
Dollars) per square foot per year for the 58,125 square feet or
the amount of space not occupied by Equipos Climatec, S.A. de
C.V., payable in twelve (12) equal and monthly installments of
$21,797.00 (Twenty-one Thousand Seven Hundred Ninety-seven and
no/100 Dollars), legal currency of the United States of America,
or Mexico if required by Mexican law. Each such payment shall be
due and payable on the first day of each calendar month.
4.2. The LESSEE agrees to make payment of the rent without the
need of prior demand or request of payment; the LESSEE, likewise,
may not retain any part of the rentals due to repairs or any
other reason whatsoever.
4.3. The installments of the Lease price referred in paragraph
4.1. above, shall be payable by the LESSEE to the LESSOR, on the
first day of each month, precisely at the payment address of the
LESSOR located at X.X. Xxx 000, Xxxxxxxx Xxxx, Xxxxxxxx 00000.
4.4. In case the LESSEE does not pay on time to the LESSOR at the
address abovementioned, interest shall accrue at the rate of
12% per annum on the overdue amount, from the rental payment due
date until the total and complete to payment is effected, without
prejudice of the right of the LESSOR to rescind this Agreement.
4.5. The rental amount shall be increased each year on the first
day of January in proportion to the increase of the "Consumer
Prices Index" published by the Department of Labor of the United
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States of America, from the prior January 1, with the
understanding the rental amounts shall never be reduced. 4.6. To
fix the increases of the rentals, as set forth in paragraph 4.5
above, the LESSEE agrees that the LESSOR shall determine such
increases according to the provisions set forth in this Section
and LESSOR shall notify LESSEE in writing of such increase. This
notice shall bind the LESSEE to pay the new rental amounts,
unless the LESSEE notifies LESSOR that there is a mathematical
error in the calculation within thirty (30) days of such invoice.
If there is a correction to the calculation of such amount,
LESSEE agrees to pay such corrected amount.
SECTION 5
LESSEE POSSESSION
5.1. The LESSOR hereby delivers the possession of the Real Estate
to LESSEE. LESSEE receives the Real Estate in possession and
states its agreement and full satisfaction with respect to its
foundations, columns, walls, exteriors, roofs, structures and all
other components.
5.2. The LESSEE shall permit to the person or persons designated
by the LESSOR the access to Real Estate for the purpose to verify
the fulfillment of the obligations of the LESSEE under the terms
set forth in this Agreement, as well as for the preservation of
the Real Estate or any other proper purpose, including but not
limited to the access of other property owned by LESSOR or its
Affiliates.
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SECTION 6
MAINTENANCE OF LESSOR
6.1. The LESSOR shall be bound to maintain the structure and
integrity of the roofs (without including the waterproofing) and
structure of the Real Estate, provided that such repairs do not
become necessary due to the negligence or misconduct of the
LESSEE or the installation of machinery, equipment or additions
or the placement of materials which due to their dangerous
nature, weight, movement, vibrations and other similar conditions
may produce any injury to the Real Estate, due to the
characteristics of the structure or roof of the Real Estate or
its actual weight resistance. For reason of the above stated
purposes, the LESSEE represents to know perfectly well the
technical characteristics of the Real Estate and states its full
satisfaction therewith.
SECTION 7
MAINTENANCE OF THE LESSEE
7.1 The LESSEE during the term hereof, binds itself to render to
the Real Estate whatever maintenance is required and to make the
corresponding repairs, so as to keep the Real Estate
in its normal state of conservation, excluding its normal wear
and tear but including the adequate waterproofing of the roofs.
7.2. For the purpose of carrying out repairs or maintenance work
referred in the foregoing paragraph on the Real Estate, when the
LESSEE is to carry out any important maintenance work, the LESSEE
must previously notify the LESSOR in writing, informing LESSOR of
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the need to carry out such work and the characteristics thereof,
so that LESSOR approves such work which approval shall not be
unreasonably withheld.
SECTION 8
IMPROVEMENTS AND INSTALLATIONS CARRY OUT BY LESSEE
8.1. The LESSEE may carry out with the previous authorization of
the LESSOR given in writing, at its expense, all improvements to
the Real Estate or installations thereof which LESSEE considers
convenient to take full advantage of the Real Estate, in
accordance with LESSEE's activities, with the understanding that
upon termination hereof, all installations, improvements or
additions of a permanent character, including but not limited to
heating ventilating and air conditioning systems equivalent of
whatsoever nature ("HVAC") installed in the Premises by LESSEE
whether permanently affixed thereto or otherwise and all fixtures
shall remain for the benefit of the Real Estate; LESSEE hereby
expressly waives the provisions of Sections 2423 and 2424 of the
Civil Code for the Federal District and their corresponding
Section of other Civil Codes applicable in the Republic of
Mexico. The LESSOR, if if it is convenient to its interest, shall
have the authority to demand from the LESSEE, upon termination
hereof, to remove all installations, improvements or additions
effected by LESSEE and said LESSEE shall deliver the Real Estate
to the LESSOR in the same state in which LESSEE received it,
reasonable wear and tear excepted.
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The LESSEE may remove the installations or improvements that it
may have carried out on the Real Estate, which are not of a
permanent nature, provided however, that upon removal thereof
that the Real Estate is left in the same state in which it was
received, with the exception of its normal wear and tear.
8.2. LESSEE's obligation to pay the rental amounts shall be in
force until the LESSEE delivers to the LESSOR the Real Estate
without any object that the LESSEE may have on the Real Estate.
The rental amounts shall accrue by complete months, according to
the terms set forth in paragraph 13.3. hereof.
SECTION 9
SIGNS
9.1. The LESSEE shall be authorized to install, inside or outside
of the Real Estate, without injury to the Real Estate, those
signs which it considers necessary, with the understanding that
they must be removed upon termination hereof and all damages
caused thereby to the Real Estate must be repaired.
9.2. The LESSEE shall permit to the LESSOR the installment of
signs in the Real Estate:to offer it on Lease, Sale, or any other
for three months before the termination of this Agreement or its
renewal.
SECTION 10
UTILITIES
10.1. The LESSEE shall on its own account enter into the
corresponding utilities contracts for lighting or power, gas or
water utilities and any other utility which may be required by
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the LESSEE to carry out its activities within the Real Estate,
all amounts charged thereof shall be paid by the LESSEE.
10.2. Upon termination of this Agreement, the LESSEE shall cancel
and pay all utilities contracts, as part of the termination
obligations related to the deliver of the Real Estate,
according to the terms set forth in Section 13 hereof and the
rental amounts set forth in paragraph 8.2. shall accrue as long
as the LESSEE does not comply with its obligations set forth
herein.
SECTION 11
LIABILITIES OF THE PARTIES
11.1 In conformance with applicable law, EQUIPOS guarantees to
OPTRON the use and peaceful enjoyment of the Premises during the
full term of the contract, and OPTRON covenants and agrees to use
the Premises only for the purposes herein set forth and in
accordance with the nature and intended usage of the Premises.
The liabilities of EQUIPOS and of OPTRON, in each case, shall be
ruled by the following provisions:
11.1.A. Each of-EQUIPOS or OPTRON, respectively, shall be liable
for damages to the Premises caused by their own fault or
negligence, or that of their agents, employees or visitors,
except for losses commonly insurable by fire insurance with
extended coverage endorsement.
11.1.B. If the Premises are damaged or destroyed by any act of
God or force majeure, upon OPTRON's written request, EQUIPOS
shall have the option to restore the Premises
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with the insurance proceeds referred to below and put them in
proper condition within 6 (six) months forOPTRON to use for the
purposes agreed on in thiscontract. However, if EQUIPOS elects
not the rebuild, this lease shall terminate without any further
responsibility to the parties.
11.1.C. If the damage is attributable to the fault or misconduct
of OPTRON, or its agents, employees or visitors, OPTRON shall be
liable to EQUIPOS for all damages caused to the Premises and
shall indemnify EQUIPOS for all cost to leave the Premises as
they were before the damage occurred.
11.1.D. The responsibilities of the parties referred to in the
foregoing paragraphs of this clause shall be subject to the
provisions of Clause Twelve of this contract.
SECTION 12
INSURANCE
12.1. The LESSEE agrees to obtain and pay for, as long as
this Agreement is in full force, or allow the LESSOR to obtain
them and LESSEE shall pay all costs thereof, the following
insurance:
The required insurance during the term of this lease shall
be against any loss or damage by fire and against any loss or
damage by lighting, explosion, hurricane and hail, airplanes,
vehicles and smoke, earthquake and/or volcanic eruption, strikes,
riots and vandalism and any other risks now or hereafter embraced
by so called "Extended Coverage" (including glass insurance), in
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amounts sufficient to prevent EQUIPOS or OPTRON from becoming a
co-insurer under the terms of the applicable policies, but in any
event in an amount equal to one hundred percent of the then "full
insurable value" (replacement value), which for the purpose of
this Clause shall be deemed to be the cost of replacing the
Premises less the cost of excavations, foundations and footings
and without any deductions for physical depreciation of the
Premises. Such "full insurable value" shall be determined from
time to time, but not more frequently than once in any twelve
calendar months, following the below mentioned procedure:
12.1.A. By means of an appraisal to be performed by acertified
appraiser for insurance purposes,designated and approved in
writing by EQUIPOS(such approval not to be unreasonably
withheld),which appraisal shall be paid by OPTRON.
12.2. As per the provisions of the preceding paragraph, OPTRON
shall also immediately contract for the benefit of EQUIPOS the
following insurance coverage:
12.2.A. General public liability insurance, covering claims for
injury, death or property damag occurring on or about the
Premises in the amount of not less than $500,000.00 (Five Hundred
Thousand and no/100 Dollars) currency of the United States of
America, for personal injury or death and of not less than
5500,000.00 (Five
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Hundred Thousand and no/100 Dollars) currency of the United
States of America for property damage.
12.2.B. Insurance against loss or damage by boiler (or
compressor), malfunction or by internal explosion by boiler (or
compressor), for any high pressure boiler (or compressor)
installed in the Premises which is part of the Premises, in such
limits as EQUIPOS, from time to time, reasonably requires.
12.2.C. Rental interruption insurance which covers the rental
payments which the LESSOR ceases to receive as a consequence of
any damage suffered which is covered under the insurance set
forth in paragraph a) above. The insured amount shall be equal to
the rent to be paid by the LESSEE per year and for an additional
indemnification period of one (1) year.
12.2.D. Liability insurance shall be obtained to cover any
possible injury which is caused on third parties in their assets
or physical integrity by a minimum amount of $500,000.00 (Five
Hundred Thousand Dollars and no/100).
12.3. All insurance provided for in this clause shall be
effected under policies issued by insurers authorized to do
business in Mexico.
12.4. All policies of insurance herein provided for shall name
EQUIPOS and OPTRON as the insured, as their respective interest
13
may appear and as approved by EQUIPOS, and, to the extent that
EQUIPOS shall request, shall contain standard mortgage clauses in
favor of the holders of mortgages on the Premises. 12.5. Each
such policy or certificate therefor issued by the insurer shall
contain an agreement by the insurer that such policy shall not be
canceled without at least ten (10) days prior notice to EQUIPOS
and to OPTRON, and that any loss which shall be payable to
EQUIPOS shall be so payable, notwithstanding any act or
negligence of OPTRON which might otherwise result in a forfeiture
of all part of such insurance. 12.6. In case of casualty
resulting in damage or destruction to the Premises, OPTRON shall
promptly give written notice thereof to EQUIPOS. Adjustment
proceedings shall be started immediately by EQUIPOS or OPTRON.
12.7. The LESSEE shall appoint LESSOR or the persons indicated by
the LESSOR in writing as beneficiaries of the insurance policies
referred above, including any creditor who has mortgage, pledge
or any other guaranty granted by the LESSOR. 12.8. In relation to
the insurance above mentioned in this Section 12, the insured
amount of the damage insurance shall correspond to the
replacement value of the Real Estate but in any event no less
than $2,500.000 (U.S. dollars). Such replacement value shall be
determined by an expert assayer selected by the LESSOR. The
insured amount must be up-dated according to inflation.
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12.9. The insurance policies above mentioned shall be obtained by
the LESSEE with the insurance companies that the LESSOR may
approve in writing, which shall be authorized to operate in the
Mexican Republic. The LESSEE shall be obligated to furnish copies
of the insurance policies or certificates to the LESSOR within
fifteen (15) days following the date in which the insurance
company issues said insurance policies.
12.10. In case the LESSEE does not comply with the obligations
set forth in this Section, and does not obtain the referred
insurance policies or does not obtain them pursuant to the terms
set forth herein, the LESSOR may obtain additional insurance in
order to satisfy the requirements set forth herein, collecting
from the LESSEE the premium amounts for such insurance as well as
the expenses or commissions derived therefrom plus an additional
amount equivalent to the penalty interest that the Mexican banks
charge to its clients on the so-called "Direct Credits". Said
interest shall be accrued as of the date in which the LESSEE
should have contracted the referred insurance until the total and
complete payment of the premium and corresponding expenses.
SECTION 13
TAXES
13.1. The parties expressly agree that the LESSEE shall pay the
Value Added Tax, Property Tax and any other taxes and recording
fees of any nature, if necessary arising out of or in connection
with this Lease Agreement. It is understood that the Income
Tax arising out of this Lease shall be paid by the LESSOR.
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SECTION 14
SURRENDER OF THE REAL ESTATE
14.1 Upon termination of this lease, the LESSEE shall
surrender the Real Estate to the LESSOR, waiving the right to
obtain the legal extension referred to in Sections 2485 of the
Civil Code for the Federal District, 2384 of the Civil Code for
the State of Chihuahua and the corresponding Sections articles of
the Civil Codes for the other States of the Mexican Republic,
waiving also the texts thereof.
14.2. The LESSEE shall surrender the Real Estate in the same
conditions in which it was received, except its reasonable wear
and tear, pursuant to the terms set forth in paragraph 8.1.
hereof.
14.3. If upon termination hereof, the LESSEE does not surrender
the Real Estate to the LESSOR, or does not completely vacate the
premises, the LESSEE shall pay a new rental amount equal to 100%
of the previous rent for a period of twelve (12) months. If after
such period, the LESSEE continues to occupy the Real Estate or
has not vacate it completely, the LESSEE shall pay an additional
increase of 100% of the rent for the following twelve (12) months
and such increases shall successively be effected every year
until the Real Estate is completely surrendered to the LESSOR.
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SECTION 15
ASSIGNMENT AND SUBLEASE
15.1. It is expressly prohibited to LESSEE to sub-lease the Real
Estate or to assign any of the rights and obligations which
derive herefrom, without the prior written consent from the
LESSOR.
SECTION 16
PAYMENT OF RENTALS TO FOREIGN FINANCE INSTITUTIONS
16.1. The LESSEE agrees that, upon receipt of written notice from
the LESSOR, the rental amounts shall be paid by the LESSEE to
foreign financial institutions, in payment of credits granted by
these institutions to the LESSOR.The abovementioned written
notice must indicate to the LESSEE the following:
a) Full name of the foreign financial institutions. b) Procedure
to be followed for the payment of the rentals to a foreign
financial institution. c) Address of the foreign financial
institution. d) Name of the financial officer or department to
which the payment must be referred. e) Identification data of the
loan or credit to which the payment shall be applied. f) The
actual form of payment, whether cash, cashiers check or certified
check, bank draft, money order, telex or whatever manner the
payment must be made.
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16.2. The LESSEE agrees to make payment of the rentals to the
persons and in the manner in which the LESSOR has indicated
pursuant to the above paragraph. The LESSEE also agrees to obtain
from the financial institutions the necessary documentation to
prove that the payment has been made, which documentation shall
be delivered to the LESSOR at its address herein set forth.
16.3. When the LESSEE gives the documented proof of payment to
the LESSOR, the LESSOR, shall furnish the LESSEE the
corresponding receipt of rental payment. The LESSOR may send such
receipt by mail to the LESSEE. The LESSEE shall effect the rental
payments in dollars, United States of America currency unless
otherwise directed by the Lessor or required by Mexican or United
States law, and if LESSEE is a maquiladora industry, LESSEE shall
follow the provisions set forth in the Complementary Regulation
for Foreign Exchange Control for Maquila Industries, in force
during the term of this Lease Agreement.
SECTION 17
LIABLITIES OF THE PARTIEs
17.1. The LESSOR warrants to the LESSEE the use and peaceful
enjoyment of the Real Estate during the full term of this Lease,
and the LESSEE covenants and agrees to use the Real Estate only
for the purposes herein set forth for and in accordance with the
nature and intended usage of the Real Estate.
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17.2. The LESSEE, shall be liable for damages on the Real Estate
caused by its own fault or negligence, or that of its agents,
employees or visitors.
SECTION 18
LESSOR'S RIGHT TO PERFORM LESSEE'S LIABILITIES
18.1. If the LESSEE shall at any time fail to perform any one or
more of its covenants made in this Lease, the LESSOR, after ten
days notice to the LESSEE (or without notice inthe case of an
emergency) and without waiving or releasing the LESSEE from any
of its obligations hereof may, but shall be under no obligation
to, perform any act on behalf of the LESSEE and may enter the
Real Estate for such purpose and take all such actions thereon as
may be necessary therefor. All sums paid by the LESSOR and all
costs and expenses incurred by the LESSOR in connection with
the performance of any such obligation of the LESSEE, shall be
payable by the LESSEE to the LESSOR within five (5) days of
receiving the request for payment.
SECTION 19
SECURITY DEPOSIT
19.1. The LESSEE has contemporaneously with the execution of this
Lease, deposited with the LESSOR the sum of $12,029.38 (Twelve
Thousand Twenty-Nine and 38/100 Dollars),
currency of the United States of America, the LESSOR issues
hereby a receipt as ample as required by law for said amount.
This sum shall be held by the LESSOR as security for the faithful
performance by the LESSEE of all the terms, covenants and
conditions of this Lease.
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19.2. Such amount shall be adjusted upward to reflect a full
month's rent as the LESSEE occupies additional space on the
premises. The LESSOR may dispose of the entire or any portion of
the amount thereof, and apply it for the payment of sums due and
payable to the LESSOR by the LESSEE hereunder. Upon the written
demand from the LESSOR, LESSEE shall deliver to LESSOR a
sufficient amount in cash to restore said security amount to the
original sum.
19.3. If the LESSEE does not pay to LESSOR the amount referred in
the foregoing paragraph within five (5) days after receipt of the
notice, it shall constitute sufficient cause for rescission of
this Lease.
SECTION 20
GUARANTEE
OPTRON being a subsidiary corporation of the company
OPTEK Technology, Inc., a company located in the United States of
America, shall obtain and deliver to EQUIPOS, at the execution of
this contract, a document in substantially the same form of the
document attached hereto as Exhibit "C" duly signed by a
representative of Optek Technology, Inc. and certified by a
Notary Public, whereby Optek Technology, Inc. shall constitute
itself as guarantor of OPTRON on a joint and several obligation
for the exact compliance with all and each of the obligations
accepted by OPTRON under this lease and such guarantee shall be
valid and binding for all the then unexpired terms of said
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contract, even if the lease was to be extended for a period
longer than that herein established.
SECTION 21
ENVIRONMENTAL INDEMNIFICATION
EQUIPOS shall indemnify and hold OPTRON, as well as any
guarantor of OPTRON, harmless with respect to any and all
damages, claims and/or liabilities or any other costs, including
but not limited to damage to any individual, property or the
environment, from the utilization, handling or
storage of any dangerous or toxic waste, residue or otherwise
hazardous substances, as those terms are defined under any
applicable Federal, State or Local statute or regulation,
technical regulations and other applicable environmental and
ecological regulations, made prior to the occupation or use
of the Premises by OPTRON for any reason including bailment.
OPTRON shall indemnify and hold EQUIPOS, as well as any
EQUIPOS' guarantor, harmless with respect to any and all damages,
claims and/or liabilities or any other costs, including but not
limited to damage to any individual, property or the environment,
arising out of OPTRON's use, handling or storage of any dangerous
or toxic waste, residue or otherwise hazardous substances in the
Premises, as those terms are defined under any applicable
Federal, State or Local statute or regulation, technical
regulations and other applicable environmental and ecological
regulations.
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SECTION 22
SUBROGATION
OPTRON agrees, at the request of EQUIPOS, to subordinate
this lease (including any extensions) to any mortgage placed upon
the Premises, provided that the holder agrees not to disturb the
possession and other rights of OPTRON under this lease so long as
OPTRON continues to perform its obligations hereunder; and in the
event of acquisition of title by said holder through foreclosure
proceedings or otherwise, to accept OPTRON as LESSEE of this
lease and to perform EQUIPOS's obligations hereunder (but only
while owner of the Premises); and OPTRON agrees to recognize such
holder or any other person acquiring title to the Premises.
OPTRON and EQUIPOS agree to execute and deliver any appropriate
instruments necessary to carry out the agreements contained
herein.
SECTION 23
LIENS
OPTRON agrees that it shall not allow any liens to be placed upon
its interest in the Premises or its interest in this lease
without the written approval of the LESSOR. LESSOR hereby waives
any security interest or any type of lien in LESSEE's personal
property, exluding all permanent fixtures and all heating
ventilation and air conditioning equipment systems, all plumbing
fixtures, equipment and systems, all sprinkler lines, equipment
and systems, and any lighting, light fixtures, electrical wiring
and sockets, which may arise hereunder by statute or otherwise,
22
.
excepting only liens arising upon execution of a judgement
received as a result of any default by LESSEE hereunder.
SECTION 24
MISCELLANEOUS
24.1. The documents attached herewith form an integral part
hereof and are initialed by the parties as evidence of agreement.
24.2. The subtitles or headings that appear in this
instrument are established for convenience and reference only, so
that in the event there is any conflict related to the
interpretation of the contents of the Section or paragraph, then
the literal sense of the contents of the Section or paragraph
shall prevail.
24.3. This contract is the only agreement executed between the
parties related to the Lease of the Real Estate. Any
interpretation, amendment or extension to this agreement, in
order to be legally effective, shall be carried out in written
form and be signed by both parties. If any amendment,
interpretation or extension is verbally effected, without the
abovementioned form, it shall not produce any legal effects.
23.4.
For the performance and compliance of this Agreement, the parties
designate as their mailing addresses the following:
THE LESSOR:
Equipos Climatec, S.A. de C.V. x/x X.X. Xxx 000
Xxxxxxxx Xxxx, XX 00000 Attn: Vice President -
Financial Operations
With a copy to: LSB Industries, Inc.
00 X. Xxxxxxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Attn: General Counsel
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THE LESSEE:
OPTRON de Mexico, S.A. de C.V.
0000 X. Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxx 00000
Attn: Vice President - Finance
With a copy to: Xxxxxxxxxxx X. Xxxxxx, Xx., Esq.
Kilgore & Kllgore
000 XxXxxxxx Xxxxx
0000 XxXxxxxx Xxx.
Xxxxxx, Xxxxx 00000
SECTION 25
RIGHTS OF FIRST REFUSAL
25.1. Sale Of Premises. If LESSOR elects to sell its beneficial
interest in the Premises to a third party, which is not an
Affiliate, in a transaction that does not involve the sale or
conveyance of any other real property of LESSOR or one of its
Affiliates, or the sale of Lessor itself or the sale, conveyance,
assignment or transfer or any other assets of LESSOR, then LESSOR
will notify LESSEE of the intended sale and the terms thereof,
and LESSEE shall have ten (10) days after receipt of LESSOR's
notice in which to give LESSOR return notice advising that LESSEE
has elected to purchase the Premises on the same terms for the
same purchase price. This right of first refusal does not apply
to any sale or proposed sale of the Premises to an Affiliate;
provided that if not previously terminated, this right of refusal
continues in full force and effect after sale or conveyance of
the Premises to an Affiliate. If LESSEE exercises its option to
purchase the Premises, LESSEE shall consummate its purchase of
the Premises on the terms set forth in LESSOR's notice to LESSEE,
but subject to paragraph 26 of this Lease. (The terms of
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LESSOR's sale of its beneficial interest in the Premises shall
contain a reservation of an easement for ingress, egress, access
and utilities in, over and across the Premises for the benefit of
other parts of Property or other real estate in which LESSOR or
any of its Affiliates have an interest.) Thereafter, upon (a)
payment of all installments of Rent and other charges due
and unpaid as of the date of closing of such sale and purchase
and (b) compliance by LESSEE with all other obligations and
liabilities, actual or contingent under this Lease which have
arisen or been incurred on or prior to the date of closing of
such sale and purchase, this Lease shall terminate (except with
respect to actual or contingent liabilities of LESSEE under this
Lease which have either accrued or been incurred under this Lease
prior to the date of termination hereof or which are to survive
termination of this Lease pursuant to an express provision
herein).
25.2. Failure to Exercise Right of First Refusal. If LESSOR gives
LESSEE written notice pursuant to paragraph 25.1 and LESSEE fails
to notify LESSOR within ten (10) days of LESSEE's election to
exercise its right of first refusal, or in the event LESSEE does
not timely complete a purchase pursuant to paragraph 25.1 after
giving the LESSOR notice of LESSEE's election to exercise its
right of first refusal, then in either event, LESSEE's right of
first refusal and other rights under this paragraph 25 shall
terminate and shall be of no further force or effect.
25
25.3. Notice of Other Sale. If the Premises or the LESSOR's
interest in the Premises are sold in any transaction which is not
the subject of paragraphs 25.1 of this Lease, then LESSOR will
give LESSEE written notice identifying the purchaser or such sale
and its address.
25.4. Notices Before Mexican Notary. All notices under this
paragraph 25 shall be given before a Mexican notary, shall be
filed as required by Mexican law, and shall comply with all other
applicable Mexican laws.
SECTION 26
PROCEDURE UPON PURCHASE OF PREMISES
26.1. Title Conveyed by LESSOR. In the event of the purchase of
the Premises or any part thereof by LESSEE pursuant to any
provision of this Lease, LESSOR need not transfer and convey any
better title thereto than such seller had on the date of the
commencement of this Lease. The instrument of conveyance signed
by LESSOR shall not contain any warranties of title or otherwise,
except as LESSOR may have agreed to give or may be willing to
give to a third-party purchaser. LESSEE, therefore to the extent
that a third party purchaser would waive it, waives the
"saneamiento para el caso de eviccion" rights that Article 2003
of the Civil Code of the State of Chihuahua, Mexico, grants to
all purchasers. The aforementioned waivers are made pursuant to
the provisions of Article 2004 of the Civil Code of the State of
Chihuahua, Mexico.
26
26.2. Sale. Grant or Conveyance. Upon the date fixed for any such
purchase of the Premises or any part thereof pursuant to any
provision of this Lease,LESSEE shall pay or cause to be paid to
LESSOR, at the place designated by such seller, the purchase
price therefor, and such seller xxxXx deliver to LESSEE an
instrument of conveyance, without any warranties of title or
otherwise, except as LESSOR may have agreed to give or may be
willing to give to a third party, which instrument (a) covers the
interest in the Premises which is being conveyed, and (b)
conveys, transfers or grants at least the title thereto which
is described in paragraph 26.1. LESSEE shall pay or cause to be
paid all charges incident to such conveyance, transfer or grant
that are or would be payable by the proposed third-party
purchaser, including, without limitation, the following charges,
if identified as purchaser expenses in LESSOR's proposed
sale to a third party: escrow fees, recording fees, all
applicable taxes (other than any franchise, capital levy, income,
profits or revenue taxes levied upon or assessed against the
seller) which may be incurred or imposed by reason of such
conveyance, transfer or grant and by reason of the delivery of
such deed and other instruments, all title company escrow
charges, all costs and premiums for title policy endorsements
required by Holder and the reasonable fees and disbursements of
counsel for the seller and of counsel for Holder. Upon the
completion of a permitted purchase of the Premises by LESSEE,
this Lease shall terminate except with respect to (1) LESSEE's
covenants, agreements and
27
indemnity in paragraph 10, (ii) all other indemnities of LESSOR
and/or Holder by LESSEE in this Lease, and (iii) all obligations
and liabilities of LESSEE, actual or contingent, under this Lease
which arose on or prior to the date of purchase.
SECTION 27
APPLICABLE LAW AND JURISDICTION
27.1. For the performance and compliance of this Agreement, the
parties expressly submit themselves to the jurisdiction of the
competent courts of Mexico, Federal District, or the Court or the
Federal Courts of United States of America if applicable, at the
LESSOR's election, and they expressly waive other forum that
could correspond to them by reason of their present or future
domiciles or any other reason whatsoever.
SECTION 28
TWO VERSIONS
28.1. This Agreement shall be executed in both English and
Spanish versions. The parties herein expressly agree that the
Spanish version shall always prevail and the English version
is done for translation purposes only. Notwithstanding the
foregoing, the English version of this Agreement shall prevail
until a Spanish version is executed by the parties.
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Having read the above Agreement and understood by the parties its
legal force, they executed it on December 8, 1991.
THE LESSEE THE LESSOR
/s/Xxxxx X Xxxxx /s/ Xxxxxx X. Xxxxxxx
BY: BY:
ATTORNEY-IN-FACT ATTORNEY-IN-FACT
/s/ Xxxxx X.Xxxxxxxx
BY:
ATTORNEY-IN-FACT
12\agrmnt\mexico.1191
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