EXHIBIT 10.39
DATED: January 30, 2001
▇ ▇ ▇▇▇▇ LIMITED (1)
AND
BIOPROGRESS LIMITED (2)
WITH
BIOPROGRESS INC (3)
AGREEMENT FOR LEASE
Relating to premises at Thorby Avenue, Hostmoor Trading Park
March Cambridgeshire
DAWBARNS ▇▇▇▇▇▇▇
SOLICITORS
▇/▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇ ▇▇▇
AN AGREEMENT made the 30 day of January, 2000
BETWEEN:
(1) ▇ ▇ ▇▇▇▇ LIMITED whose registered office is at ▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ [CRN3998705] (hereinafter called
"the Landlord")
(2) BIOPROGRESS LIMITED whose registered office is at ▇ ▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ [CRN3289265] (hereinafter called "the
Tenant")
(3) BIOPROGRESS INC a company incorporated in and governed by the
Law of the State of Nevada, USA (hereinafter called the
"Surety")
NOW IT IS HEREBY AGREED as follows:
1. Definitions
1.1 In this Agreement the following terms shall have the following meanings
And terms defined in the Lease and used herein shall have the meanings
ascribed to them in the Lease
1.1.1 "The Architect" means ▇▇▇▇▇ ▇▇▇▇▇ of The Studio ▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇▇ such other person firm or company (being in the case of
an individual a professional associate or fellow of the Royal Institute
of British Architects and in the case of a firm or company having at
least one partner or director (as the case may be) who is an associate
or fellow of the said Institute) as may be appointed by the Landlord to
be the Architect for the purposes of this Agreement and whose name
shall have been notified in writing to the Tenant by the Landlord
1.1.2 "the Building Contract" means the building contract dated 31st May 2000
entered into by the Landlord with the Building Contractor for the
carrying out of the Development
1.1.3 "the Building Contractor" means Kier Regional Limited of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ or such other building contractor of Good
repute with experience in carrying out projects of a similar or Greater
size and degree of complexity to the Development as the Landlord Shall
reasonably and properly employ from time to time under the Building
Contract and whose name shall be notified in writing to the Tenant by
the Landlord
1.1.4 "the Construction Team" means the Architect the Structural Engineer and
the Building Contractor
1.1.5 "Practical Completion of the Unit has the meaning set out in Clause 7
hereof
1.1.6.1 "the Development" means the development of a new industrial unit with
associated external works with
all mains services and access roads thereto from the adopted road known
as Thorby Avenue or Hostmoor Avenue, March on the Site
1.1.6.2 "the Site" means the land edged blue on the annexed plan
1.1.6.3 "the Drawings" means the detailed plans and the specification which
have been agreed between the Landlord and the Tenant prior to the
execution of this Agreement and copies of which are annexed hereto and
have been signed by the parties and the expression shall include all
variations and alterations thereof as may be agreed from time to time
by the Landlord and the Tenant
1.1.7 "the Landlord" means the first party of this Agreement and includes its
successors in title and assigns
1.1.8 "the Landlord's Solicitors" means Dawbarns ▇▇▇▇▇▇▇ of ▇/▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (Ref JMA)
1.1.9 "the Lease" means the Lease to be granted by the Landlord to the Tenant
of the Premises pursuant to this Agreement in the form of the draft
lease attached hereto
1.1.10 "the Premises" means the new industrial unit on the Development and is
more particularly described in this Lease as the "Demised Premises" and
for identification purposes edged in red on the annexed plan
1.1.11 "the Rent Commencement Date" means the date of Completion of the Lease
1.1.12 "the Structural Engineer" means Greens Limited of Whaplode Spalding
Lincolnshire or such other person firm or company (being in the case of
an individual a member or fellow of the Association of Consulting
Engineers or the Institution of Civil Engineers and in the case of a
firm or company at least one of whose partners or directors shall be a
member or fellow of the said (Association or Institution) as may be
employed for the purposes of this Agreement by the Landlord and whose
name shall have been notified to the Tenant in writing
1.1.13 "the Tenant" means the second party to this Agreement
1.1.14 "the Tenant's Solicitors means Ollard and Bentley of ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
1.1.15 "the Term Commencement Date" means the last usual quarter day which
precedes or is coincident with the date of Completion of the Lease
1.1.16 "the Tenant's Works" means the office fitting of the Premises in
accordance with the plan annexed No and the erection of the signage on
plan No
1.1.17 "Working Day" means a day falling on or between Monday and Friday upon
which clearing banks in the City of London being members of the
Committee of London and Scottish Clearing Banks) are open for normal
business
1.1.18 "the Surety" means the third party to this Agreement
2. Landlord to Procure Consents
2.1 The Landlord will use its reasonable endeavours to obtain as soon as
Reasonably practicable and at its own expense all authorisations
certificates consents approvals permissions and licences necessary
(hereinafter called "the Necessary Consents") to complete the
Development and will (subject to the Necessary Consents) procure that
its contractors with all due diligence construct and complete the
Development in accordance with the Drawings and Necessary Consents and
the Building Contract for the same and all relevant statutory
requirements to the reasonable satisfaction of the Tenant in all
respects
3. Landlord to carry out works
3.1 The Landlord shall (subject to the Necessary Consents) proceed
diligently With the construction of the Premises in a good and
workmanlike manner and unless prevented from so doing by strikes
lockouts shortages of materials weather wars unreasonably delay by the
Highway Authority or other cause not within its control procure the
completion of the construction of the Premises as soon as reasonably
practicable and (unless prevented from so doing as aforesaid) not later
than the date which is months from the date hereof or in case it is
prevented from so doing as soon thereafter as may be reasonably
practicable
3.2 If the Landlord is unable to obtain at a reasonably cost any of the
materials Referred to in the Approved Drawings and Specification the
Landlord may in carrying out the Works substitute for them alternative
materials as nearly as may be of the same quality subject always to the
overriding requirements of the local or other competent authority and
if so requested the Landlord will provide such information as the
Tenant shall reasonably require to show compliance with this Clause
3.3 The Landlord may in carrying out the Works make such modifications to
The Approved Drawings and Specification and to the details of the Works
contained in them:
3.3.1 as may be required by any local or other competent Authority
as a condition of the grant or continuance in force in the
Landlord's Approvals or any of them or
3.3.2 as may be reasonably required by the Architect provided that
no modification shall be made pursuant to this Clause 3.3.2
which would materially alter the design nature capacity or
standard of construction or appearance of the Premises as
provided for in the Building Specification or materially
prejudice the use of the Premises for the purposes specified
in the Lease
3.4 If at any time the Development is carried out otherwise than in
accordance with the Drawings and this fact might reasonably have been
expected to be
apparent on a full visual inspection to the Tenant on the first occasion
following the carrying out of the relevant works on which it actually
inspected the same pursuant to Clause 6 ("the Inspection") then unless
within five (5) working days after the date of the Inspection (time being
of the essence) the Tenant has served on the Architect a Defects Notice in
respect of such non-compliance the Development shall be treated for all
purposes of this Agreement as having been carried out in accordance with
the Drawings
4. Grant of Lease
4.1 In consideration of the Landlord performing the Landlord's obligations
Under Clauses 2 and 3 hereof the Tenant and Surety will within 7 days of
Practical Completion of the Premises or earlier by agreement enter into
the Lease
4.2 The initial rent payable under the Lease will commence to be payable on
The Rent Commencement Date
5.1 The Lease and the will be prepared by the Landlord's Socilitors and an
Engrossment of the counterpart shall be delivered to the Tenant's
Solicitors seven days before Practical Completion
5.2 The Lease shall be completed at the offices of the Landlord's Solicitors
or at Such other place in England as the Landlord's Solicitors shall
reasonably require
5.3 At any time on or after the date for completion of the Lease either the
Landlord or the Tenant being ready and willing to complete the Lease and
perform its other obligations under this agreement may (but without
prejudice to any other available right or remedy) by notice to the
other invoke the provisions of Clause 5.4
5.4 Within twenty days after service of such notice under Clause 5.3 hereof
(excluding the day of service) the Lease shall be completed and the
parties shall perform their other obligations under this Agreement and
time shall be of the essence of this provision
6. Inspection of works by Tenant
The Tenant shall have the right for itself its agents and surveyors at all
reasonable times and on reasonable notice to the Architect during the
erection or construction of the Development in company with the Architect
or his representative to view the state and progress of the works but the
Tenant shall refer all matters whether a complaint or otherwise to the
Architect or his representative and not to the Building Contractor
7. Practical Completion
7.1.1 For the purpose of this Agreement the expression "Practical Completion of
the Premises" shall mean:
(a) the date upon which the Landlord and the Tenant or their respective
representatives mutually agree (such agreement not to be
unreasonably withheld) that the Premises is complete (except for
minor matters as provided for in sub-clause 7.3 below) and that
there is proper vehicular to the Premises or:
(b) in the event of a dispute the date upon which the Architect (who
shall consider but not be bound by representations (if any) made by
the Landlord or the Tenant) shall certify that the Premises are
complete in accordance with the Building Contract and that there is
proper vehicular access to the Premises
(c) "proper vehicular access" means that the Premises may be accessed
from Thorby Avenue or Hostmoor Avenue for all reasonable purposes of
the Tenant in connection with its enjoyment of the Premises
including contractors vehicles for fitting out but shall not oblige
the Landlord to lay the top coat of the roadways until all the
buildings on the Development are completed
7.2 The Landlord shall give notice in writing to the Tenant of the intended
date of Practical Completion of the Premises and shall invite the Tenant
to send a representative to accompany a representative of the Landlord or
the Architect On the inspection made for the purpose of determining the
date of Practical Completion
7.3 Uncompleted matters of a minor nature shall be schedule in a snagging list
to Be issued with the certificate of the Architect referred to in
subclause 7.1 (b) above and carried out or made good by the Landlord or
the Building Contractor as soon as possible after the date of Practical
Completion of the Unit without prejudice to the maintenance period
referred to in Clause 12 hereof at times reasonably convenient to the
Tenant
7.4 In the event that Practical Completion of the Unit shall not have taken
place by te date which is twelve months from the date hereof the Tenant
may at any time thereafter give the Landlord three months notice in
writing of its intention to terminate this Agreement and if Practical
Completion of the Premises shall not take place within such three month
period then at the determination of such period of one month this
Agreement shall terminate but without prejudice to the rights of either
party in respect of any antecedent breach
8. Services
The Landlord shall without cost to the Tenant and before (or after in the
case o delay as hereinafter provided in this clause) Practical Completion
of the Unit procure that water gas drainage and electric services shall be
laid into the pemises to satisfy the requirements of the Tenant as set out
in the said secification provided that the Tenant shall:
9.1 make early application to the service authorities for the supply of
such services
9.2 promptly furnish to the service authorities any test certificates required
by the service authorities in respect of work (if any) carried out in the
Premises by the Tenant
9.3 be responsible for any payment required by the service authorities for the
installation of meters
10. Deleterious Materials
The Landlord shall not in the construction of the Development use any high
Alumina cement, permenant woodwool shuttering, concrete containing Calcium
chloride (except concrete containing quantities of calcium chloride Within
acceptable tolerance levels in accordance with BS882 and BS8110) Asbestos
or asbestos based materials, silicate bricks or tiles, sea dredges or sea
Washed aggregates (save where the same comply with BS882 and BS8110)
Concrete having a drying shrinkage in excess of 0.045% colliery waste as a
Filling material, pot and rib type construction for suspended
floors/roofs, Hollow bricks/blocks (exclusive of perforated bricks) and
brickwork/blockwork with a soluble sulphate content in excess of 0.5% and
any other substances not in accordance with British Standards Institution
Standard or Codes of Practice or which have been identified as deleterious
in a publication of the British Research Establishment
10. Insurance
The Landlord shall or shall procure the Building Contractor to maintain
insurance of the Landlord's Works in accordance with the Building Contract
and the Landlord shall cause the Premises to be insured in accordance with
the provisions set out in relation to insurance in the Lease on or with
effect from Practical Completion of the ▇▇▇▇
▇▇. Defects
11.1 Any defects shrinkage or other faults (other than shrinkage cracks of a
hairline Nature normally occurring as a result of drying out) which may
appear in the Premises within the period of six months after the date of
Practical Completion of the Unit arising from any defect in the
construction of the Premises or from faulty workmanship or materials or
from frost occurring before Practical Completion of the Unit shall
forthwith be made good by the Landlord at its own cost to the reasonable
satisfaction of the Tenant the Landlord causing or procuring the minimum
inconvenience and disruption reasonably possible to the Tenant's business
11.2 If any structural or design defect or defect arising under the Building
Contract Shall at any time appear in the Premises the Landlord will at the
request of the Tenant but at the Tenant's expense (subject to the
provision of security for such expenses as the Landlord shall require)
take such action (including legal proceedings) against any member of the
Construction Team as the Tenant shall reasonably require and the Tenant
shall be reimbursed in respect of any contribution towards the cost of
taking such action that is recovered by the Landlord from the relevant
member of the Construction Team
11.3 If any structural or design defect shall at any time appear in the
Development (other than the Premises) the Landlord will if reasonable to
do so and at the request of the Tenant at its own expense take such action
(including legal proceedings if reasonable to do so) against any member of
the Construction Team as the Tenant shall reasonably require and use all
reasonable endeavours to procure that credit for all sums so recovered are
set off against the service charge liability under the Lease
12. CDM
The Landlord and the Tenant each agree that in undertaking their
respective works they will each comply with the Construction (Design and
Management) Regulations 1994
13. General
13.1 As from the date of Practical Completion of the Premises the parties
hereto Shall observe and perform and be otherwise subject to and have the
benefit of all their respective covenants and other conditions and
obligations to be contained in the Lease to the extent permitted by law
notwithstanding that it shall not at that date have been completed
13.2 The Tenant shall not assign or part with its interest under this
Agreement
13.3 Notwithstanding the execution of the Lease this Agreement shall remain in
force with regard to anything remaining to be done performed or observed
hereunder and not provided for in the Lease
13.4 If any dispute or question whatsoever shall arise between the parties
hereto with respect to any clause or thing herein the matter in dispute
shall be determined by a single Arbitrator in accordance with the
Arbitration Acts 1950 to 1979 or any statutory modification or
re-enactment thereof for the time being in force whose decision (save in
the case of manifest error) shall be final and binding
14. Title
14.1 The Landlord's title is unregistered and shall commence with a conveyance
on Sale dated the 15th November 1983 between ▇ ▇ ▇▇▇▇▇▇ (1) and Landread
Limited (2)
14.2 The Premises are to be demised subject to all ▇▇▇▇▇▇ contained mentioned
in te documents of title (except those relating to any Mortgage or Legal
Charge entered into by the Landlord). An Abstract of Title having been
supplied to the Tenant prior to the signing hereof it shall be deemed to
take the Lease subject to all such entries and shall raise no objection or
requisition in respect thereof other than the usual Stat Plus requisition
or any requisitions arising as a consequence of any pre-completion
searches
15. Tenant's Works
15.1 In this Clause:
15.1.1 "Tenant's Approvals" means all (if any) approvals consents
permissions and licenses of any local other competent Authority
which may from time to time be necessary to enable the Tenant
lawfully to commence and to carry out the Tenant's Works
15.1.2 "Tenant's Plans" means detailed plans drawings and
specifications setting out the Tenant's proposals for the
Tenant's Works and such other documents and information as to
the nature and extent of the Tenant's Works as are annexed
hereto and marked "Tenants Plans" and such other drawings
prepared on a 1:100 scale by or on behalf of the Tenant as are
consistent herewith
15.2 The Tenant shall at its own expense apply for and use all reasonable
endeavours to obtain without delay all Tenant's Approvals and serve
notice thereof upon the Landlord as soon as practicably possible
following the determination of any Application
15.3 To the extent that the Tenant has possession of the Premises at any time
before Completion of the Lease the Tenant shall hold the same as tenant
at will of the Landlord with effect from that date ("Entry Date") in
that regard and shall pay rent calculated on a daily basis at the same
rate as the rent and service charge stipulated in the Lease
15.4 The Tenant shall at its own expense carry out and with all due
expedition Complete the Tenant's Works:
15.4.1 in a good and workmanlike manner and with sound materials of
their respective kinds
15.4.2 in accordance with the Tenant's Plans
15.4.3 in accordance with the terms of the Tenant's Approvals and
otherwise in compliance with all requirements of the local and
any other competent Authority
15.4.4 in such a way as to ensure that obstruction to or interference
with the carrying out of the Development is kept to a reasonable
minimum
15.4.5 to the reasonable satisfaction of the Architect in all respects
15.4.6 in a reasonable manner so as not to cause any damage or danger
interruption or obstruction to any adjoining or neighbouring
property or the use and enjoyment thereof
15.5 The Tenant shall:
15.5.1 pay and indemnify the Landlord against all fees charges and
other payments whatever which may at any time be payable to any
local or other competent Authority in respect of the Tenant's
Works
15.5.2 be answerable for and indemnify the Landlord against all actions
costs claims demands and liability whatever in relation to any
failure by the Tenant to comply with its obligations herein or
in relation to any claim made by any adjoining owner or occupier
or member of the public or other person in connection with the
carrying out of the Tenant's Work
15.5.3 with effect from the Completion Date or the Entry Date if
earlier pay and indemnify the Landlord against all rates taxes
assessments duties charges impositions and outgoings from time
to time charged upon the Premises or the owner or occupier of
them
15.6 The Landlord shall procure that as soon as practicable after the
Tenant's Works have been substantially completed to the reasonable
satisfaction of the Architect in all respects the Architect shall issue
to the Landlord and the Tenant a certificate to that effect
15.7 Subject as otherwise expressly provided herein all fixtures and
additions Affixed to or installed in the Premises as part of the
Tenant's fitting out works shall become and remain Tenants Fixtures
notwithstanding that any of them may be affixed or installed after
completion of the Lease
15.8 from the commencement of the Tenant's Works until completion of the
Lease the Tenant shall insure or cause to be insured the Tenant's Works
in the joint names of the Landlord and the Tenant against loss or damage
by such risks as the Landlord shall reasonably require in an amount
equal to the full cost of reinstating the Tenant's Works (or such part
of the Tenant's Works as shall from time to time have been carried out)
in the event of their total destruction together with the cost of
demolition site clearance architect and other professional fees and
shall produce evidence of such cover to the Landlord upon request and
apply all monies received from any such policy of insurance in
reinstating the Tenant's Works and in so far as such proceeds are not so
applied they shall belong to the parties in proportion to their
respective interests
15.9 the Tenant shall not do or permit nor suffer to be done on the
Development or in relation to the Premises and whether or not in
relation to the Tenant's Works anything which might render void or
voidable any policy of insurance effected by the Landlord in respect of
the Development or the Site or the Premises
16. Notices
Any demand or notice to be served on the Tenant or any Surety hereunder
shall be validly served if sent by first class post addressed to the
Tenant or the Surety respectively (and if there shall be more than one
of them then to any of them) at its registered office or its last known
address or at the Premises. Any Notice to be served on the Landlord
shall be validly served if sent by first class post addressed to the
Landlord at its registered office Any demand or notice sent
by post shall be conclusively treated as having been served Forty eight
hours after posting
17 Surety's Covenant
17.1 The Surety agrees to observe and perform each and every obligation of The
Tenant set out or referred to in this Agreement
17.2 If the Tenant fails to duly observe and perform the Tenant's Obligations
and stipulations of this Agreement or any of them the Surety shall make
good to the Landlord all reasonably and proper loss damage costs and
expenses arising as a result of such failure
17.3 No neglect or forbearance on the part of the Landlord in enforcing
Observance and performance by the Tenant of any of the Tenant's
obligations and stipulations herein and no time or other indulgence given
by the Landlord to the Tenant shall release discharge or in any way affect
the liability of the Surety under this clause
Executed as a Deed by ▇ ▇ ▇▇▇▇ Limited
acting by a Director
and Company Secretary
Executed as a Deed by a BioProgress Limited
acting by ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Hind, a Director
and ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Company Secretary
Signed as a deed on behalf of BioProgress Inc, A company incorporated in the
State of Nevada, USA by ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Longman, being the person who, in
accordance with the laws of that territory, is acting under the authority of the
Company
