EXHIBIT 10.24
DATED THIS 1ST DAY OF APRIL, 2003
BETWEEN
UNICO TECHNOLOGY BERHAD
AND
MATTLINE INDUSTRIES SDN BHD
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EQUIPMENT LEASE AGREEMENT
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XXXX & PARTNERS
ADVOCATES & SOLICITORS
Xxxxx 00, Xxxxx X
Xxxxxx Xxxxx XXXX
00000 Xxxxx Xxxxxx
Telephone: (000) 0000 0000
Facsimile: (000) 0000 0000
CONTENTS
NO. CLAUSE HEADING PAGE
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1. DEFINITIONS AND CONSTRUCTION.................................................... 1
1.1. Definitions............................................................ 1
1.2. Construction........................................................... 3
2. THE LEASE AND CONDITIONS PRECEDENT.............................................. 3
3. DELIVERY AND ACCEPTANCE......................................................... 4
4. LEASE PERIOD.................................................................... 4
5. RENT AND PAYMENTS............................................................... 5
6. REPRESENTATIONS AND WARRANTIES.................................................. 7
7. GENERAL UNDERTAKINGS............................................................ 8
8. OPERATIONAL UNDERTAKINGS........................................................ 9
9. TITLE AND REGISTRATION......................................................... 11
10. INSURANCES..................................................................... 11
11. LOSS AND DAMAGE................................................................ 11
12. TERMINATION EVENTS............................................................. 12
13. OPTION TO PURCHASE EQUIPMENT................................................... 14
14. REDELIVERY..................................................................... 14
15. INDEMNITIES.................................................................... 15
16. MISCELLANEOUS PROVISIONS....................................................... 15
16.1. Benefit of Agreement.................................................. 15
16.2. Further Assurances.................................................... 15
16.3. Rights Cumulative, Waivers............................................ 16
16.4. Delegation............................................................ 16
16.5. Notices............................................................... 16
16.6. Costs and Taxes....................................................... 17
16.7. Invalidity of any Provision........................................... 17
16.8. Intervention by Lessee................................................ 17
17. GOVERNING LAW.................................................................. 17
THIS EQUIPMENT LEASE AGREEMENT is made on the 1st day of April, 2003
BETWEEN:
(1) UNICO TECHNOLOGY BERHAD (Company No. 189742-K) company incorporated
under the laws of Malaysia with its registered office at 0xx Xxxxx,
Xxxxxx XXX, Xxxxx Xxxxxxx, 00 Xxxxx Xxxx, 00000, Xxxxx Xxxxxx, Xxxxxxxx
(the "LESSOR"); and
(2) MATTLINE INDUSTRIES SDN. BHD. (Company No. 606069-A) a company
incorporated in Malaysia under the laws of Malaysia with its registered
office at Level 41-B, Menara Maxis, Kuala Xxxxxx Xxxx Xxxxxx, 00000
Xxxxx Xxxxxx (the "LESSEE").
WHEREAS the Lessor has agreed to lease certain equipment to the Lessee upon and
subject to the terms and conditions of this Agreement
NOW IT IS HEREBY AGREED as follows:
1. DEFINITIONS AND CONSTRUCTION
1.1. Definitions
In this Agreement, unless the context otherwise requires:
"BUSINESS" means the business carried on by the
Lessor as at the date hereof, including
the electronic manufacturing services
business;
"BUSINESS DAY" means a day (excluding Saturday) on
which banks are open in Penang, Malaysia
for the transaction of business of the
nature required by this Agreement;
"COMPLETION DATE" means the date of completion of the Joint
Venture Agreement;
"DELIVERY DATE" the later of 1 May 2003 or the Completion
Date;
"DESIGNATED ACCOUNT" means the account held and maintained
under the name of the Lessor or its
nominees in accordance with Clause 5.4
and having the particulars specified in
SCHEDULE 2;
"EQUIPMENT" means any and all equipment specified in
SCHEDULE 1 hereto and all substitutions,
renewals and replacements made in or to
that equipment, and any other equipment
as determined by the Lessor from time to
time in the Lessor's absolute discretion;
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"FINANCIERS" means the banks, financial institutions
and other entities specified in APPENDIX
1 which have provided credit facilities
to the Lessor to acquire possession of
the Equipment;
"FINANCIERS' AGENT" means the agent collectively appointed or
consented to by the Financiers;
"FINANCING DOCUMENTS" means the documents specified in APPENDIX
2 pursuant to which the Financiers have
financed the Lessor's acquisition of
possession of the Equipment;
"FINANCIERS' INTEREST" means the rights, title and interest of
the Financiers in the Equipment pursuant
to the Financing Documents;
"FINANCIERS' UNDERTAKING" means the undertaking, the form of which
is set out in APPENDIX 3;
"INSPECTION" means the inspection that may be carried
out by the Lessee or its authorized
representatives or agents on the
Equipment prior to the Delivery Date;
"INTEL CORPORATION" means Intel Corporation, a corporation
incorporated in the United States of
America or any of its subsidiaries,
related corporations, associated
companies or affiliates;
"JOINT VENTURE AGREEMENT" means the joint venture agreement between
TFS International, Ltd., TFS
International, II Ltd., Unico Systems Sdn
Bhd, Unico Holdings Berhad and the Lessor
dated April 1, 2003;
"LEASE PERIOD" means the period specified as such in
SCHEDULE 2;
"PROPOSED DELIVERY DATE" means the date on which falls five (5)
Business Days (or such shorter time as
may be mutually agreed between the Lessor
and the Lessee) prior to the Delivery
Day;
"RENTAL" means all and any amounts payable to the
Lessor by the Lessee pursuant to Clause 5
of this Agreement;
"RM" and "RINGGIT" means the lawful currency from time to
time of Malaysia;
"RENTAL PAYMENT DATE" means the date on which the Rental is due
to be paid in accordance with Clause 5.2;
"SECURITY INTEREST" means any mortgage, charge, pledge, lien,
right of set-off (excluding any right of
set-off arising in favor of a banker by
operation of law) or other security
interest whatsoever, howsoever created or
arising;
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"SELLER" means any person from whom the Lessor had
purchased the Equipment; and
"TERMINATION EVENT" means any of the events or circumstances
specified in Clause 12 as constituting a
Termination Event; and "PROSPECTIVE
TERMINATION EVENT" means any event or
circumstance which with the giving of
notice and/or the lapse of time and/or
the fulfillment of any other condition
would be a Termination Event.
1.2. Construction
In this Agreement, unless the context requires otherwise, any reference
to:
(a) an "AGENCY" of a state or government includes any ministry,
agency, board, bureau, commission, department, authority,
statutory corporation (whether autonomous or not) or other
instrumentality of or any corporation or other entity owned or
controlled by such state or government;
(b) an "AUTHORIZATION" includes any and all approvals, consents,
licenses, permits, franchises, permissions, registrations,
declarations, reductions or exemptions;
(c) a "MONT" means a calendar month;
(d) a "PERSON" includes any individual, juridical person, company,
body corporate or unincorporate, partnership, firm, joint
venture or trust or any federation, state or subdivision
thereof or any government or agency of any thereof; and
(e) "TAX" includes any tax, levy, duty, charge, compulsory loan,
impost, fee, deduction or withholding of any nature now or
hereafter imposed, levied, collected, withheld or assessed and
"TAXATION" shall be construed accordingly.
1.3. In this Agreement, unless the context requires otherwise, words
importing the singular include the plural and vice versa and words
importing a gender include every gender; references herein to Clauses
and Schedules are to clauses of and schedules to this Agreement;
references to this Agreement or any other document shall be construed
as references to such document as the same may be amended or
supplemented from time to time.
2. THE LEASE AND CONDITIONS PRECEDENT
2.1. The Lessor agrees to lease, and the Lessee agrees to take on lease, the
Equipment upon the terms and conditions set out in this Agreement.
2.2. The Lessee shall not be obliged to take the lease of all or any
Equipment from the Lessor, unless the Lessee shall have received in
form and substance satisfactory to it:
(a) a copy certified by an authorized director of the Lessor as
being a true, complete and up-to-date copy of each of the
following:
(i) the constituent documents of the Lessor; and
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(ii) the business license and/or registration certificate
of the Lessor;
(b) evidence that the execution of this Agreement has been duly
authorized by the Lessor;
(c) documentary evidence that all authorizations necessary in
connection with the execution and performance of this
Agreement and all other documents referred to herein or to be
executed in connection herewith have been obtained; and
(d) such other documents relating to any of the matters
contemplated herein as the Lessee may reasonably request.
2.3. (a) On the Delivery Date, the Lessee shall pay to the Lessor the
sum of Ringgit Malaysia Nine Hundred and Fifty Thousand
(RM950,000) being equivalent to one month Rental as security
deposit for the observance and performance by the Lessee of
the terms and conditions of this Agreement ("SECURITY
DEPOSIT").
(b) The Security Deposit shall not be treated as payment of the
Rental or any part thereof and the Security Deposit shall be
returned to the Lessee free of interest on the termination of
the lease or the expiry of the Lease Period (whichever the
earlier to occur) provided that if the Lessee has incurred any
liability to the Lessor under this Agreement the Lessor shall
be at liberty and shall have absolute right and power to apply
the Security Deposit in reduction or discharge of the Lessee's
liability to the Lessor.
3. DELIVERY AND ACCEPTANCE
3.1. On the Delivery Date:
(a) the Lessor will deliver to the Lessee the Equipment under this
Agreement;
(b) the Lessor will deliver to the Lessee the Financiers'
Undertaking duly executed by each of the Financiers; and
(c) the Lessee shall thereupon take delivery of such Equipment
from the Lessor.
3.2. The Lessor shall extend to the Lessee the benefit of any guarantee,
condition or warranty which may have been given to the Lessor by the
manufacturer of the Equipment or the Seller in so far as the same is
capable of being assigned to the Lessee.
3.3. Subject to the terms of this Agreement, the Lessor will do nothing to
disturb the quiet possession and use of the Equipment by the Lessee
during the Lease Period.
4. LEASE PERIOD
4.1. The leasing of any Equipment under this Agreement shall commence on the
Delivery Date and shall, subject to this Clause 4 and the provisions of
this Agreement relating to earlier termination, end on the last day of
the Lease Period.
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4.2. (a) At any time between the Proposed Delivery Date and the
Delivery Date, the Lessee shall be entitled (but not
obligated) to conduct the Inspection.
(b) Notwithstanding any remedy which may be available to the
Lessee under this Agreement, if, following the Inspection, the
Lessee considers that the Equipment or any part thereof is in
an unsatisfactory condition or suffers from any defect, the
Lessee may require the Lessor to either:
(i) rectify the unsatisfactory condition or defect
("RECTIFICATION"); or
(ii) replace the Equipment or the part thereof that is
unsatisfactory or suffers from the defect
("REPLACEMENT").
(c) the Lessor shall undertake the Rectification or Replacement
prior to the Delivery Date so that the Equipment, when
delivered on the Delivery Date shall not be in an
unsatisfactory condition or suffer from any defect.
4.3. Following the Inspection, no defect or unsatisfactory condition of the
Equipment or any failure of the Equipment to comply with the warranties
or representations of the Seller or the manufacturer in relation
thereto, and no loss, theft, damage or destruction of the Equipment or
any part thereof, nor any other event, change in law or circumstances
of any nature whatsoever, shall impair any obligation of the Lessee
under this Agreement (including without limitation as to the payment of
Rentals or other sums), so that all such obligations shall, except as
provided in Clause 12, continue in full force and effect.
5. RENT AND PAYMENTS
5.1. The Lessee shall pay to the Lessor, Rentals during the Lease Period in
accordance with the provisions of this Clause 5. The total value of
Rentals is Ringgit Malaysia Forty Five Million Six Hundred Thousand
(RM45,600,000) representing 48 payments of RM950,000. The Rental to be
paid by the Lessee to the Lessor on each Rental Payment Date is the sum
of RM950,000.
5.2. Subject to Clause 5.3, the Lessee shall pay to the Lessor the Rental on
the day of the month on which the Delivery Date falls. For the
avoidance of doubt, if the first Rental Payment Date falls on the 15th
day of the month, all subsequent Rental Payment Dates shall be the 15th
day of the month. The first Rental Payment Date shall be the Delivery
Date.
5.3. All payments to be made by the Lessee under this Agreement, whether of
Rentals or otherwise, shall unless otherwise provided be made in
Malaysian Ringgit to the Designated Account not later than 10:00 a.m.
(local time in the place for payment) on the due date for payment and
for value on that date and in all cases under telefax advice to the
Lessor.
5.4. (a) The Lessor acknowledges and undertakes to procure that:
(i) the Designated Account shall be used solely for the
purpose of receiving Rentals due from the Lessee
under this Agreement;
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(ii) the Rentals paid into the Designated Account shall be
applied as follows:
(aa) firstly, in paying all amounts due from the
Lessor to the Financiers;
(bb) secondly, all expenses incurred in
connection with the performance of the
Lessor's obligations under this Agreement;
and
(cc) thirdly, the balance (if any), shall be for
the account of the Lessor.
(b) In furtherance of this Clause 5.4, the Lessor agrees to
procure the appointment of the Financiers' Agent as authorized
signatory of the Designated Account on terms and with
authority limits acceptable to the Financiers.
5.5. If any payment would otherwise be due on a day which is not a Business
Day, it shall be due on the preceding Business Day.
5.6. The Lessee will pay interest at the rate of eight per centum (8%) per
annum, on any outstanding Rental which is due and payable under this
Agreement.
5.7. (a) Subject as hereinafter provided, the Lessee may on any Rental
Payment Date prepay all or any of the installments of the
Rentals to become due in inverse order of maturity provided
that:
(i) the Lessee shall have given to the Lessor not less
than six (6) months' prior written notice of its
intention to make the prepayment, specifying the
amount thereof and the date on which it is to be
made, together with evidence satisfactory to the
Lessor that the Lessee has received, or will receive
before the intended date of prepayment, any necessary
authorization for such prepayment;
(ii) the Lessee may not prepay part only but must pay the
whole of an installment of the Rentals; and
(iii) any prepayment pursuant to this Sub-clause shall be
made together with all accrued interest on the
Rentals to the date of prepayment and all other sums
then payable pursuant to this Agreement.
(b) Any notice of intended prepayment given by the Lessee under
Sub-clause 5.7(a)(i) shall be irrevocable and the Lessee shall
be bound to make a prepayment in accordance therewith.
5.8. The Lessee may not prepay the Rentals or any one installment thereof
otherwise than in accordance with the express terms of this Agreement.
Prepayment of the Rentals or any one installment thereof shall not
affect or limit in any way the liability of the Lessee with regard to
any other payment due or to become due to the Lessor pursuant to this
Agreement.
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6. REPRESENTATIONS AND WARRANTIES
6.1. The Lessor acknowledges that the Lessee has entered into this Agreement
in full reliance on the following representations by the Lessor and the
Lessor now warrants to the Lessee as follows:
(a) the Lessor is validly existing as a legal entity under the
laws of Malaysia, has full power and authority to enter into
and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby and is duly
qualified to do business in each jurisdiction where failure to
qualify would have material effects on the business or
operations of the Lessor;
(b) the execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby have
been duly authorized by all necessary action on the part of
the Lessor, and do not require the consent or approval of, the
giving of notice to, or the registration with, or the taking
of any other action in respect of, any governmental, fiscal,
exchange control or regulatory body or agency to which the
Lessor is subject or any other person, except the
authorizations evidence of which has been or will be delivered
to the Lessee pursuant to Clause 2; and do not contravene any
law or regulation or order binding on the Lessor or the
Lessor's constituent documents or contravene the provisions
of, or constitute a default under, any other agreement or
instrument by which the Lessor is bound or result in the
creation of any Security Interest upon the property of the
Lessor;
(c) this Agreement constitutes the legal, valid and binding
obligations of the Lessor enforceable in accordance with its
terms;
(d) the Lessor's obligations under this Agreement are direct,
general and unconditional obligations of the Lessor and rank
at least pari passu in all respects with all its other present
and future unsecured and unsubordinated obligations (including
contingent obligations) with the exception of obligations
mandatorily preferred by law and not by contract;
(e) save and except for proceedings between the Lessor and Intel
Corporation, no litigation, arbitration or administrative
proceeding before or of any court, tribunal or regulatory
authority is presently taking place, pending or, to the
knowledge of the officers of the Lessor, threatened against it
or any of its assets or revenues which could have a material
adverse effect on the business, assets or financial condition
of the Lessor;
(f) each and every item of Equipment on the Delivery Date:
(i) will be in a good state of repair and condition and
satisfactory working order;
(ii) will have been regularly and properly serviced and
maintained;
(g) no Termination Event or prospective Termination Event has
occurred and is continuing; and
7
(h) neither the Lessor nor any of its property or assets is
entitled to any immunity from any legal action or proceeding
(which shall include, without limitation, suit, attachment
prior to judgment, execution or other enforcement).
6.2. Without prejudice to anything contained in Clause 6.1 of this
Agreement, the Lessee hereby agrees that any representation or
warranties to the Equipment's suitability or fitness (as opposed to the
Equipment's condition) for a particular purpose for which it is or may
be required whether express or implied and whether arising under this
Agreement or under any prior agreement or in oral or written statements
if made by the Lessor or its representatives are hereby excluded and
the Lessor shall be absolved from all liabilities, claims, actions,
cost and expense in respect thereof.
6.3. The Lessor further represents and warrants to and undertakes with the
Lessee that the foregoing representations and warranties will be true
and accurate as if made on the Delivery Date and on each Rental Payment
Date with reference to the facts and circumstances then subsisting.
6.4. The Lessee acknowledges that the Lessor has entered into this Agreement
in full reliance on the following representations by the Lessee and the
Lessee now warrants to the Lessor as follows:
(a) the Lessee is validly existing as a legal entity under the
laws of Malaysia, has full power and authority to enter into
and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby and is duly
qualified to do business in each jurisdiction where failure to
qualify would have material effects on the business or
operations of the Lessee;
(b) the execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby have
been duly authorized by all necessary action on the part of
the Lessee, and do not require the consent or approval of, the
giving of notice to, or the registration with, or the taking
of any other action in respect of, any governmental, fiscal,
exchange control or regulatory body or agency to which the
Lessee is subject or any other person; and do not contravene
any law or regulation or order binding on the Lessee or the
Lessee's constituent documents or contravene the provisions
of, or constitute a default under, any other agreement or
instrument by which the Lessee is bound or result in the
creation of any Security Interest upon the property of the
Lessee;
(c) this Agreement constitutes the legal, valid and binding
obligations of the Lessee enforceable in accordance with its
terms; and
(d) no litigation, arbitration or administrative proceeding before
or of any court, tribunal or regulatory authority is presently
taking place, pending or, to the knowledge of the officers of
the Lessee, threatened against it or any of its assets or
revenues which could have a material adverse effect on the
business, assets or financial condition of the Lessee.
7. GENERAL UNDERTAKINGS
7.1. The Lessor undertakes with the Lessee that:
8
(a) save and except for the Financiers' Interest, the Lessor will
not, without the prior written consent of the Lessee, create
or permit to exist:
(i) any Security Interest over the Equipment or any part
thereof or the rights of the Lessor under this
Agreement; or
(ii) any Security Interest over any other assets of the
Lessor if the existence of such Security Interest
might prejudice the ability of the Lessor to perform
its obligations under this Agreement;
(b) the Lessor will send to the Lessee the annual audited
financial statements of the Lessor;
(c) the Lessor will maintain in full force and effect all relevant
authorizations (governmental and otherwise) and will promptly
obtain any further authorizations which may become necessary
to enable it to perform any of the transactions contemplated
by this Agreement, if any; and
(d) the Lessor will forthwith notify the Lessee if the Lessor
becomes aware of the occurrence of a Termination Event or
prospective Termination Event, and provide the Lessee with
full details of any steps which the Lessor is taking or
proposes to take in order to remedy or mitigate the effect
thereof and to protect the interests of the Lessee hereunder.
7.2. The Lessee undertakes with the Lessor that:
(a) the Lessee will not, without the prior written consent of the
Lessor, create or permit to exist any Security Interest over
the Equipment or any part thereof or the rights of the Lessee
under this Agreement
(b) the Lessee will send to the Lessor such financial statements,
financial reports and other information with respect to the
Lessee's financial condition, business and operations as the
Lessor may reasonably request from time to time;
(c) the Lessee will maintain in full force and effect all relevant
authorizations (governmental and otherwise) and will promptly
obtain any further authorizations which may become necessary
to enable it to perform any of the transactions contemplated
by this Agreement;
(d) the Lessee will forthwith notify the Lessor if the Lessee
becomes aware of the occurrence of a Termination Event
relating to the Lessee or prospective Termination Event, and
provide the Lessor with full details of any steps which the
Lessee is taking or proposes to take in order to remedy or
mitigate the effect thereof and to protect the interests of
the Lessor hereunder.
8. OPERATIONAL UNDERTAKINGS
8.1. The Lessee undertakes with the Lessor that from the Delivery Date until
all its liabilities under this Agreement have been discharged:
9
(a) the Lessee will not cause or permit the Equipment to be
operated in any manner contrary to any law or regulation which
may for the time being be applicable to the Equipment and will
not do or allow to be done anything which may expose any part
of the Equipment to penalty, forfeiture, impounding, detention
or destruction;
(b) the Lessee will promptly pay or procure the payment of all
rent, rates, fees, license duties, registration charges, taxes
and other outgoings in respect of any premises where the
Equipment or any part thereof shall be, and will keep the
Equipment, or procure that the Equipment is kept, from being
distrained for rent, rates and other taxes or in any way
attached;
(c) the Lessee will not sub-let or otherwise part with possession
of any part of the Equipment to any person except with the
prior written consent of the Lessor. Notwithstanding the
consent or agreement of the Lessor to any such sub-letting or
parting with possession, the Lessee shall at all times remain
liable to observe and perform and shall be responsible for
procuring the observation of and compliance with all the
provisions of this Agreement;
(d) at all times from the Delivery Date until all its liabilities
under this Agreement have been discharged, the Lessee shall,
at its own expense, maintain, service, repair and overhaul
each and every item of the Equipment so as to keep the
Equipment equipped with the accessories, parts and components
installed or supplied as part thereof at the Delivery Date or
with substitutes or replacements made in accordance with this
Agreement and to keep the Equipment in good repair, condition
and appearance in all respects;
(e) the Lessor shall not be liable for any expense in repairing
any item of the Equipment or be liable to supply any equipment
or any item in lieu of the Equipment or any part thereof if
the same is lost, confiscated, damaged or otherwise rendered
unfit for use;
(f) the Lessee shall follow the Equipment manufacturer's
recommendation as to the maintenance and service needs and use
of the Equipment;
(g) the Lessee shall permit the Lessor and any person authorized
by the Lessor at all reasonable times and with reasonable
prior notice, to enter upon the premises in which the
Equipment are kept for the purpose of inspecting and examining
the Equipment;
(h) the Lessee shall inform the Lessor immediately if the
Equipment is the subject matter of any litigation proceedings,
distraint or lien by any person and all costs incurred by the
Lessor to oppose or defend such acts or actions shall be borne
and paid by the Lessee; and
(i) the Lessee shall not sell, assign, pledge, charge, encumber or
part possession or otherwise deal with the Equipment or any
part thereof or any interest therein nor create nor allow to
be created any lien on the Equipment.
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9. TITLE AND REGISTRATION
9.1. The Lessor represents and warrants that save and except for the
Financiers' Interest on the Delivery Date, the Lessor has full
unencumbered title over the Equipment, there is no Security Interest
created over the same save and except for the Financiers' Interest and
that the Equipment is in the possession and control of the Lessor.
9.2. The Lessee shall at its own expense do all such acts and things as may
be necessary, to protect its interests in the Equipment or any part
thereof against the claims of any other party or parties.
10. INSURANCES
10.1. The Lessee shall at its own cost and expense from the Delivery Date and
until all its liabilities under this Agreement have been discharged
procure that insurance is taken out and maintained on the Equipment, at
a value not less than the full replacement value thereof or the
aggregate of the Rentals from time to time outstanding under this
Agreement whichever is the greater, comprehensively against all loss or
damage from whatsoever cause including, without prejudice to the
generality thereof, any loss, damage or destruction by fire, theft,
accident or special peril and such other risks as the Lessor may from
time to time nominate in writing;
11. LOSS AND DAMAGE
11.1. In the event of any loss, damage or destruction to the Equipment or any
part thereof, or if the Equipment or any part thereof is rendered
wholly or partly unfit for use in any way, then, subject as mentioned
in Sub-clause 11.3, the Rentals payable under this Agreement shall not
be abated either in whole or in part, and the Lessee shall not be
released from any of its other obligations as to payment or otherwise
hereunder.
11.2. If the Equipment is lost, destroyed or irreparably damaged or is
declared a constructive, compromised, agreed or arranged total loss
from any cause whatsoever (any such occurrence being hereinafter called
a "TOTAL LOSS") during the Lease Period, the Lessor and the Lessee
shall proceed diligently and co-operate fully with each other in the
recovery of any and all proceeds of insurance or compensation
applicable thereto. Any and all amounts realized therefrom whether from
insurance or otherwise (hereinafter called the "TOTAL LOSS PROCEEDS")
shall be paid to the Lessor for application in accordance with
Sub-clause 11.4.
11.3. On the earlier of:
(a) the date on which the Total Loss Proceeds are received by the
Lessor; and
(b) the date one (1) month after the occurrence of the Total Loss
as determined by the Lessor,
the Lessee shall pay to the Lessor an amount equal to the aggregate of
all the Rentals, accrued interest thereon and all other sums payable by
the Lessee under this Agreement less the amount of net Total Loss
Proceeds (being the gross Total Loss Proceeds less any expenses
incurred in connection with the collection of such proceeds and any
taxes payable in respect thereof) received by the Lessor by the date
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of payment.
11.4. The Lessor shall apply any Total Loss Proceeds received by it
as follows:
(a) firstly, in paying all expenses incurred in connection with
the collection of such Total Loss Proceeds and any taxes
payable in respect thereof;
(b) secondly, in paying all amounts due from the Lessee hereunder;
and
(c) thirdly, the balance, if any, up to an amount equal to the
amount paid by the Lessee under Sub-clause 11.3 shall be
refunded to the Lessee.
12. TERMINATION EVENTS
12.1. If:
(a) the Lessor fails to materially perform or materially breaches
any of its obligations under this Agreement, or under any
undertaking or arrangement entered into in connection herewith
and, in the case only of a failure which in the opinion of the
Lessee is capable of being remedied, such failure is not
remedied to the Lessee's satisfaction within thirty (30) days
after the Lessor became or should have been aware of the
failure;
(b) any representation, warranty or statement which is made (or
acknowledged to have been made) by the Lessor in this
Agreement or in any certificate, statement, or notice provided
under or in connection with this Agreement proves to be
incorrect and which reasonably threatens the use and enjoyment
of the Equipment, or if repeated at any time with reference to
the facts and circumstances subsisting at such time would not
be accurate in such respect ;
(c) an encumbrancer takes possession of, or a trustee or similar
officer is appointed in respect of, all or any substantial
part of the business or assets of the Lessor, or distress or
any form of execution is levied or enforced upon or sued out
against any substantial part of such assets and is not
discharged within ten (10) days of being levied, enforced or
sued out, or any Security Interest which may for the time
being affect any substantial part of its assets becomes
enforceable;
(d) the Lessor is declared insolvent;
(e) the Lessor convenes a meeting of its creditors or proposes to
make any arrangement or composition with ("ARRANGEMENT"), or
any assignment for the benefit of, its creditors or a petition
is presented or a meeting is convened for the purpose of
considering a resolution, or other steps are taken, for the
winding-up of the Lessor, UNLESS :
(i) the winding-up is for the purposes of and followed by
a reconstruction previously approved in writing by
the Lessor;
(ii) the Arrangement results in the Lessor continuing as a
going concern or the Lessee is of the opinion that
the Arrangement will likely result in the Lessor
continuing as a going concern;
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(f) the ownership of the Equipment or any part of it by
Lessor is contested in legal proceedings and final
judgment which impugns, undermines or prevents the
Lessor's ability to lease the Equipment to the Lessee
in accordance with the terms of this Agreement, is
obtained.
then, the Lessee may at any time by notice in writing to the
Lessor immediately treat such event as a repudiation by the
Lessor of this Agreement and terminate the leasing of the
Equipment under this Agreement.
12.2. The Lessee shall be in default if:
(a) it fails to pay the Rental or any part thereof on the Rental
Payment Date; or
(b) it fails to materially perform or materially breaches any of
its obligations under this Agreement, whether express or
implied which the Lessor determines is not capable of remedy;
or
(c) it fails to materially perform or materially breaches any
covenant or condition which the Lessor determines that it is
capable of being remedied but not remedied by the Lessee
within a period of ten (10) days after notice from the Lessor;
or
(d) if it intimates to the Lessor, in writing before the expiry of
the Lease Period that it no longer desires to continue with
the leasing for whatever reason; or
(e) if it attempts to move, sell, transfer, encumber or sublease
the Equipment or any part thereof without the written consent
of the Lessor; or
(f) it files or has filed against it a petition in bankruptcy or
becomes insolvent or makes an assignment for the benefit of
its creditors or pass a resolution for its winding-up
(otherwise then by way of amalgamation or re-construction).
12.3. (a) Upon the occurrence of any one of the above events specified
in Clause 12.2, the Lessor shall be entitled to terminate this
Agreement or this lease immediately without notice whereupon
the Lessee shall deliver the Equipment to the Lessor within
fourteen (14) days of receiving the Lessor's notice of
termination in writing, failing which the Lessor shall be
entitled to enter upon any land or building on or in which the
Equipment is located or kept and take possession and remove
the Equipment.
(b) The Lessee shall, upon the termination of this Agreement or
this lease, pay to the Lessor all Rental Payments owing to the
Lessor under this Agreement for the unexpired Lease Period. In
addition, the Lessee shall be liable for all legal
professional fees, other costs and expenses incurred or
expended by the Lessor to recover from the Lessee any monies
owed by the Lessee to the Lessor or to enforce or exercise any
of the Lessor's remedies hereunder. Each remedy shall be
cumulative and in addition to any other remedy otherwise
available to the Lessor at law or in equity, and for the
avoidance of doubt no express or implied waiver of any default
of any provisions of this Agreement shall constitute a waiver
of any of the Lessor's other rights.
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(c) Forthwith upon taking possession of the Equipment pursuant to
Clause 12.3(a), the Lessor shall take such steps as may be
necessary to offer the Equipment for sale with the intention
of realizing the maximum amount of proceeds from such sale as
is practicable under the circumstances. The Lessee shall be
entitled to participate in such sale which shall be completed
within one month from the Lessor obtaining delivery or taking
possession of the Equipment. The proceeds of the sale shall be
applied in the following order of priority:
(i) firstly, towards bearing the costs of conducting such
sale (including any tax or stamp duty arising
therefrom);
(ii) secondly, towards the repayment to the Lessor of any
amounts owed by the Lessee to the Lessor under this
Agreement for the unexpired Lease Period; and
(iii) thirdly, the balance of the proceeds of such sale (if
any) shall be for the account of the Lessee.
(d) In the event that following the sale of the Equipment provided
for under Clause 12.3(c), the Lessor shall not have realized
the full amount of sums owned by the Lessee to the Lessor
under this Agreement for the unexpired Lease Period, the
Lessee shall be liable to pay the Lessor for such amount as
remains unpaid by the Lessee to the Lessor.
13. OPTION TO PURCHASE EQUIPMENT
At the end of the Lease Period, and if no Termination Event has
occurred and is continuing and all amounts payable by the Lessee under
this Agreement have been paid by the Lessee, the Lessee shall have the
option to purchase each and every item of the Equipment at a price of
RM1. If the Lessee exercises its option hereunder the Lessor shall, at
the request and expense of the Lessee, execute such documents and do
such things as may reasonably be necessary to transfer ownership of the
Equipment to the Lessee including ensuring that the Financiers' release
and disclaim the Financiers' Interest in the Equipment and delivering
the Equipment to the Lessee in such manner and within such time as may
be required by the Lessee provided that payment for the exercise of the
option has been settled. The Equipment shall be sold to the Lessee
under this Clause in an "as is, where is" condition and without any
conditions, warranties or representations of any kind being made or
given by the Lessor in respect of the Equipment or otherwise.
14. REDELIVERY
14.1. If the Lessee does not exercise its option under Clause 13 within
thirty (30) days after the end of the Lease Period or such longer
period as the Lessor may allow, and except following a Total Loss, the
Lessee shall forthwith at its own expense redeliver the Equipment to
the Lessor at such location as the Lessor shall specify.
14.2. The Lessee shall redeliver the Equipment in a condition so as to
demonstrate that the Lessee has in all respects complied with its
obligations under this Agreement in relation to the operation,
maintenance, repair and general upkeep of the Equipment,
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and so that the Equipment is in all respects in as good condition as at
the Delivery Date (fair wear and tear excepted).
15. INDEMNITIES
15.1. The Lessor hereby agrees at all times to indemnify and hold the Lessee
and its directors, officers, agents and employees harmless from and
against:
(a) all and any liabilities, claims, proceedings, penalties,
fines, costs and expenses whatsoever which may at any time be
made or claimed by any person (including without limitation
any director, officer, employee, agent or sub-contractor of
the Lessor) or by their respective dependents arising directly
or indirectly out of or in any way connected with any breach
of this Agreement by the Lessor or arising directly or
indirectly out of or in any way connected with any proceedings
between Lessor and Intel Corporation; and
(b) all liabilities, claims, proceedings, penalties, fines, costs
and expenses which may at any time be made or claimed on the
grounds that any design, article or material in the Equipment
or any part thereof or the operation or use thereof
constitutes an infringement of any patent, copyright, design
or other proprietary right.
15.2. The Lessor shall fully indemnify the Lessee against any loss, damage,
expense or liability (as to the amount of which the certificate of the
Lessor shall be prima facie evidence) which the Lessee may sustain or
incur as a consequence of the occurrence of any Termination Event.
15.3. The Lessee hereby agrees at all times to indemnify and hold the Lessor
and its directors, officers, agents and employees harmless from and
against all and any liabilities, claims, proceedings, penalties, fines,
costs and expenses whatsoever which may at any time be made or claimed
by any person (including without limitation any director, officer,
employee, agent or sub-contractor of the Lessee) or by their respective
dependents arising directly or indirectly out of or in any way
connected with any breach of this Lessee's obligations under this
Agreement.
15.4. All indemnities contained in this Clause 15 shall continue in full
force and effect notwithstanding termination of this Agreement for any
reason and notwithstanding the cessation of business or dissolution or
any change in the constitution of the Lessee, or any other fact, event
or circumstance of any kind whatsoever, whether similar to any of the
foregoing or not.
16. MISCELLANEOUS PROVISIONS
16.1. Benefit of Agreement This Agreement shall be binding on and enure to
the benefit of the Lessee and the Lessor and their respective
successors and assigns, provided that neither party may assign or
transfer any of its rights or obligations under this Agreement without
the prior written consent of the other party.
16.2. Further Assurances The Lessor agrees from time to time to do and
perform such further acts and execute and deliver any and all such
further instruments as may be required by law or requested by the
Lessee to establish, maintain and protect the
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rights and remedies of the Lessee and to carry out and effect the
intent and purpose of this Agreement.
16.3. Rights Cumulative, Waivers The rights of the Lessee under this
Agreement are cumulative, may be exercised as often as it
considers appropriate and are in addition to its rights under general
law. The rights of the Lessor against the Lessee or in relation to the
Equipment (whether arising under this Agreement or general law) shall
not, as against or in favor of the Lessor, be capable of being waived
or varied otherwise than by and in writing; and in particular any
failure to or any delay in exercising any of such rights shall not
operate as a waiver or variation of that or any other such right; any
defective or partial exercise of any of such rights shall not preclude
any other or further exercise of that or any other such right; and no
act or course of conduct or negotiation on its part or on its behalf
shall in any way preclude it from exercising any such right or
constitute a suspension or any variation of any such right.
16.4. Delegation The Lessee may delegate to any person or persons all or any
of the trusts, powers or discretions vested in it in this Agreement
upon such terms and conditions and (including power to sub-delegate) as
the Lessee in its absolute discretion thinks fit.
16.5. Notices Each notice, demand or other communication to be given or made
hereunder shall, except as otherwise provided herein, be given or made
in the English language and writing, either by letter or facsimile and
shall be sent to the relevant party at its address set out below (or
such other address as the relevant party shall have previously notified
to the other):
To the Lessor: Unico Technology Berhad
0xx Xxxxx,
Xxxxxx XXX,
Xxxxx Xxxxxxx,
00 Xxxxx Xxxx,
00000, Xxxxx Xxxxxx
Xxxxxxxx
Attention: Company Secretary
Telephone No: 000 0000 0000
Facsimile No: 603 2142 6199
To the Lessee: Mattline Industries Sdn Bhd
Suite B, Level 41, Menara Maxis
Xxxxx Xxxxxx Xxxx Xxxxxx
00000 Xxxxx Xxxxxx
Attention: Company Secretary
Telephone No: 00-0000 0000
Facsimile No: 00-0000 0000
Any notice, demand or other communication so addressed to the
respective party shall be deemed to have been delivered (i) if given or
made by letter, when delivered to or left at that address; and (ii) if
given or made by facsimile, when dispatched with confirmed transmission
report.
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16.6. Costs and Taxes Each party shall bear their own costs (including legal
costs) expenses and taxes incurred in the preparation of this Agreement
and the discharge of their respective obligations hereunder.
Notwithstanding anything contained herein, the Lessee shall pay the
stamp duty assessable on this Agreement.
16.7. Invalidity of any Provision If any of the provisions of this Agreement
becomes invalid, illegal or unenforceable in any respect under any law,
the validity, legality and enforceability of the remaining provisions
shall not in any way be affected or impaired.
16.8. Intervention by Lessee If the Lessor fails to comply with any provision
of this Agreement, the Lessee may, without being in any way obliged to
do so or responsible for so doing and without prejudice to the right of
the Lessee to treat that non-compliance as a Termination Event, effect
compliance on behalf of the Lessor, whereupon the Lessor shall become
liable to pay immediately any sums expended by the Lessee together with
all costs and expenses (including legal costs) in connection therewith.
17. GOVERNING LAW
This Agreement and the rights and obligations of the parties hereunder shall be
governed by and interpreted and construed in all respects in accordance with the
laws of Malaysia.
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IN WITNESS WHEREOF this Agreement has been executed on the day and year first
above written.
SIGNED by /s/ Xxxx Xxxxx Xxx, General )
Manager, Finance )
for and on behalf of )
UNICO TECHNOLOGY BERHAD )
in the presence of )
SIGNED by /s/Xxxxxx Xxxxxx, Director )
for and on behalf of )
MATTLINE INDUSTRIES SDN BHD )
in the presence of )
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