LEASE AGREEMENT
Between
CONSORCIO INMOBILIARIO DEL NORESTE, S.A. DE C.V.
as Landlord
And
SIMCLAR DE MEXICO, S.A. DE C.V.
as Tenant
As of _11-1-04_______, 2004
Property Location:
Ave. Cantinflas entre Xxxxx Xxxxxx y Colorado
X. Xxxxxxxxx
State of Tamaulipas
United Mexican States
LEASE AGREEMENT
THIS LEASE AGREEMENT (the "Lease") is made and entered into as of the 1ST__ day
of _NOVEMBER____, 2004, by and between CONSORCIO INMOBILIARIO DEL NORESTE, S.A.
DE C.V., represented herein by its legal representative, Xx. Xxxxxxxx Xxxxxx
Xxxxxxxxx Xxxxxxxxx (hereinafter referred to as "Landlord"), and SIMCLAR DE
MEXICO, S.A. DE C.V., represented herein by its President and legal
representative, Xx. Xxxxxxx Xxx Xxxxxxx Xxxxxxx (hereinafter referred to as
"Tenant"), with the intent to be legally bound.
RECITALS
A. Landlord hereby states, through its legal representative, that:
(i) It is a corporation duly incorporated and existing pursuant to
the laws of the United Mexican States, as per Public Deed Number 743,
dated March 30, 1982, from the records of Notary Public Number Xxxx Xxxxx
Xxxxxxx, in and for the City of X. Xxxxxxxxx, State of Tamaulipas, United
Mexican States, and recorded in the Public Registry of Property in the
City of X. Xxxxxxxxx, State of Tamaulipas, United Mexican States, under
entry Number 2824, File 965, Book 67, Commerce Section, dated April 1,
1982, and that his authority was granted under the same instrument.
(ii) It is the owner of a tract of land with a surface area of
103,738.80 square feet, located at Ave. Cantinflas, entre Xxxxx Xxxxxx y
calle Colorado, in the City of X. Xxxxxxxxx, State of Tamaulipas, United
Mexican States, and a building to be constructed thereon of 55,524.00
square feet, the plans and specification of such building and related
improvements (the "Building"), which parcel of land is described in the
blueprint attached to this Lease as Exhibit "A", which is considered as
incorporated by reference herein and becomes a part hereof, and which will
hereinafter be referred to individually as the "Land"; the Land and the
Building are hereinafter referred to collectively as the "Premises".
(iii) It desires to lease the Premises to the Tenant under the terms
and conditions hereinafter set forth.
B. Tenant hereby states, through its legal representative, that:
(i) It is a corporation duly incorporated and existing pursuant to
the laws of the United Mexican States, as per Public Deed Number 1550,
Volume 120, dated December 19, 2004, granted by Xx. Xxxxx Xxxx Xxxxxxx
Danache, from the records of Notary Public Number 150, in and for the City
of X. Xxxxxxxxx, State of Tamaulipas, United Mexican States, and recorded
in the Public Registry of Property in the City of X. Xxxxxxxxx, State of
Tamaulipas, United Mexican States, under Entry Number 725, Volume 3-015,
Book I, Commerce Section, dated January 22 of 2004, and that his authority
was granted under the same instrument.
(ii) It wishes to lease the Premises under the terms and conditions
of this Agreement.
C. Both parties state, through their respective legal representative,
that:
(i) In the execution hereof there had been no error, violence, bad
faith nor duress between them.
(ii) Their respective representatives have sufficient authority to
execute this Lease, same authority that has not been revoked, diminished
or limited in any way whatsoever.
(iii) They mutually acknowledge the authority with which their legal
representative appear to the execution hereof.
SECTION 1
PREMISES; GUARANTY
1.1 Description.
(a) Landlord, for and in consideration of the rents herein reserved
and of the covenants and agreements herein contained on the part of the Tenant
to be performed, hereby leases to Tenant, and Tenant hereby takes and hires from
Landlord, the Premises together with a leasehold interest in all rights,
privileges, easements and appurtenances thereunto belonging for the "Term" (as
defined in Section 2.1) of this Lease.
(b) The Premises contains a total of 55,524.00 Sq. Ft., rentable of
area (all on grade). By taking occupancy of the Premises, Tenant shall be deemed
to have accepted the same as suitable for the purposes herein intended, subject
to Landlord's maintenance obligations under the provisions of this Lease
including Section 10.1 hereof.
1.2 Title Matters. The Premises are subject to the easements,
restrictions, reservations and other permitted encumbrances (the "Permitted
Encumbrances") set forth on the attached Exhibit B incorporated herein by
reference. Landlord agrees that it will not create any easements, rights of way,
covenants, or restrictions (the "Restrictive Agreements") affecting the Premises
except: (a) the Permitted Encumbrances; (b) park rules and regulations
established in Landlord's reasonable documents and (c) Restrictive Agreements
required by any proposed or existing mortgagee of the Premises (each a
"Mortgagee") in connection with Landlord's financing of the Premises provided
that such Restrictive Agreements do not materially affect Tenant's exclusive use
of the Building, as contemplated by this Lease, and are commercially reasonable.
1.3 Environmental Condition.
(a) Landlord represents that (i) the Building will be delivered to
Tenant in accordance with Section 2 hereof free and clear of any material
"Hazardous Substances" (as defined in Section 7.1 hereof) except as permitted by
Section 7.4(a) hereof and (ii) during the Term, the Landlord will not take any
actions that would violate the environmental laws of any applicable jurisdiction
in the United Mexican States.
(b) Tenant acknowledges that (i) it shall comply, at its sole
expense, with all applicable laws, including environmental laws relative to the
Premises and Tenant's use, occupancy and operations at the Premises; and (ii)
during the Term, the Tenant will not take any actions that would violate the
environmental laws of any applicable jurisdiction in the United Mexican States.
(c) Landlord shall indemnify, defend with counsel reasonably
acceptable to Xxxxxxx, and hold Tenant fully harmless from and against any and
all liability, loss, suits, claims, actions, causes of action, proceedings,
demands, costs, penalties, damages, fines and expenses, including, without
limitation, attorneys' fees, consultants' fees, laboratory fees and clean-up
costs and the costs and expenses of investigating and defending any claim or
proceedings, resulting from the presence of any Hazardous Substances (as defined
in Section 7.1 hereof) at the Premises arising prior to the Commencement Date
from the action or inaction of Landlord, its employees, contractors, and agents
(but excluding any such liability arising from negligence of Tenant) or arising
out of: (i) the generation, storage, treatment, handling, transportation,
disposal or release of any Hazardous Substance at the Premises, or (ii) any
violation(s) of any applicable law regarding Hazardous Substances at the
Premises.
(d) Tenant shall indemnify, defend with counsel reasonably
acceptable to Landlord, and hold Landlord fully harmless from and against any
and all liability, loss, suits, claims, actions, causes of action, proceedings,
demands, costs, penalties, damages, fines and expenses, including, without
limitation, attorneys' fees, consultants' fees, laboratory fees and clean-up
costs and the costs and expenses of investigating and defending any claim or
proceedings, resulting from the presence of any Hazardous Substances (as defined
in Section 7.1 hereof) at the Premises arising after the Commencement Date from
the action or inaction of Tenant, its employees, contractors, and agents (but
excluding any such liability arising from negligence of Landlord) or arising out
of: (i) the generation, storage, treatment, handling, transportation, disposal
or release of any Hazardous Substance at the Premises, or (ii) any violation(s)
of any applicable law regarding Hazardous Substances at the Premises.
1.4 Uses and Zoning. Landlord represents and warrants that the proposed
use of the Premises, as stated in Section 6 hereof, is permitted by applicable
governmental laws and regulations and that there are no recorded covenants,
restrictive agreements or easements that will adversely impact the use of the
Premises. For such purposes Landlord has, or will, obtain a zoning certificate
(certificado de uso de suelo) issued by the corresponding Authority that the
Premises are zoned for industrial purposes, and deliver a copy of the same to
the Tenant.
1.5 Guaranty. As a condition for Landlord agreeing to enter into this
Lease with Tenant, Landlord has required that a corporation
guarantee the full payment and performance of Tenant's obligations
under this Lease. The agreement of guaranty shall be in the form
attached hereto as Exhibit "C" (the "Guaranty") and shall be duly
executed by Guarantor (the "Guarantor") and delivered to Landlord
simultaneously with the execution and delivery of this Lease by
Tenant.
SECTION 2
TERM
2.1 Term: Commencement Date.
(a) The term (the "Term") of this Lease shall commence on the
"Commencement Date" (as defined below) as more particularly
set forth in subsection (b) below and shall end on
__10-31-_______2017 (the "Expiration Date"), unless sooner
terminated pursuant to the terms and conditions of this Lease.
If Tenant exercises its option to extend the Term pursuant to
Section 26 hereof, the Expiration Date and the Term shall be
extended in accordance with such Section 26.
(b) The "Commencement Date" of this Lease shall mean
__11-1-04____________.
(c) Tenant shall have free access to the Premises from
_10-7-04________, 2004, in order to carry out inspections of
the Premises.
2.2 Certain Definitions. As used in this Lease, the following terms shall
have the meanings set forth below:
(a) "Force Majeure Delay", shall mean any delays beyond a party's
reasonable control, including emergency governmental restrictions, regulations,
or control, strikes, shortages of labor or materials, order of civil, military
or naval authority, governmental preemption, Acts of God; fire, earthquake,
floods, explosions, extreme weather conditions, enemy action, terrorism, civil
commotion, riot or insurrection or other unavoidable physical casualty, or any
other causes which are beyond the delaying party's control.
(b) "Confirmatory Amendment", shall mean when the Commencement Date,
the Rent Commencement Date and Expiration Date hereof have been determined in
accordance with the provisions set forth in this Lease, the parties hereto shall
execute a document in recordable form not later than fifteen (15) days following
Landlord's written request therefore, setting forth said dates and said document
shall be deemed a supplement to and part of this Lease.
2.3 Building Compliance. Landlord warrants that, as of the Commencement
Date, the Building shall be in compliance with all applicable Mexican laws and
regulations governing the construction of the Building (excluding such laws and
regulations as may apply solely to Tenant's business or operations at the
Premises; except as provided in Section 1.4 above).
SECTION 3
RENT
3.1 Rent.
(a.1)In consideration of this Lease, the Tenant shall pay during the
first eight years of the "Initial Term," commencing on the Commencement Date of
this Landlord, as rent for the use and possession of the Premises, the net
monthly amount of US $0.48 (FORTY EIGHT CENTS), legal currency of the United
States of America, per each square foot of the Building (the "Initial Base
Rent"), in monthly payments, of US$26,651.52 (Twenty six thousand six hundred
and fifty one dollars 52/100) U.S. CY, legal currency of the United States of
America, each, giving as result and annual rent total of $319,818.24 (Three
hundred and nineteen thousand eight hundred and eighteen dollars 24/100 U.S.
CY), Accordingly, Tenant shall make rent payments to Landlord totaling U.S.
legal currency of the United States of America, plus the applicable value added
tax. Rent for the first month is to be deferred to the end of the 8-year lease
period. The initial deposit for the building will be one month's rent, payable
upon the start of construction, and the lease being signed by both parties.
(a) Monthly installments of Annual Base Rent shall be payable by
Tenant to Landlord beginning on the Commencement Date, as determined or extended
in accordance with Section 2 hereof, and by the fifth day of each succeeding
calendar month thereafter during the Term without demand, together with any
scheduled monthly payments of Additional Payment Obligations. All Annual Base
Rent and Additional Payment Obligations shall be due and payable to Landlord
without abatement, suspension, reduction, discount, setoff, counterclaim or
defense in lawful currency of the United States of America.
(b) All installments of Annual Base Rent, the Additional Payment
Obligations and all other money to be paid by Tenant to Landlord hereunder shall
be paid in lawful currency of the United States of America by electronic bank
wire transfer of immediately available funds to such bank or place, or in such
other manner as Landlord may from time to time designate in writing to Tenant.
Landlord agrees to deliver a corresponding official invoice to Tenant for any
amounts so paid following Landlord's receipt of any payment of Annual Base Rent
or Additional Payment Obligations in compliance with the United Mexican States.
(c) The term of this Lease Agreement shall be of thirteen years
starting on _11-1____, 2004, and terminating on _10-31___, 2017, (Initial Term)
same being obligatory to both parties, except in the event of the cause
established in of this Agreement. The Landlord hereby agrees and accepts that
the rental payments shall be decreased by five (5%) percent based on the monthly
sum paid as rent commencing on the ninth year of the Initial Term. Accordingly,
the adjusted monthly rental payment will be $25,318.94 (Twenty five thousand
three hundred and eighteen dollars 94/100 ) U.S. CY, and a total annual rent
$303,827.32 (Three hundred and three thousand eight hundred and twenty seven
dollars 32/100 ) U.S. CY, legal currency of the United States of America, plus
the applicable value added tax. The adjusted rental payments will be fixed for
the duration on the Initial Term.
The Landlord grants an option to the Tenant to extend the Initial Term of
the Lease for an additional term of five years (First Extension Term). In order
to exercise the option to extend this agreement as mentioned before, the Tenant
must give written notice to the Landlord at least 90 days prior to the
termination of the Initial Term, otherwise the Landlord will have no obligation
to hold and reserved the property for the Tenant and the Landlord may take any
actions to promote or advertise the property for a future Tenant.
3.2 Lease Year. For purposes of this Lease, the term "Lease Year" shall
mean a period of twelve (12) full calendar months. The first Lease Year shall
begin on the Commencement Date and shall end on the last day of the twelfth
(12th) full calendar month following the Rent Commencement Date. Each subsequent
Lease Year shall consist of twelve (12) full calendar months following the
immediately preceding Lease Year, except that the final Lease Year of the Term
shall end on the Expiration Date.
3.3 Additional Payment Obligations. In addition to payment of the Annual
Base Rent as set forth in Section 3 herein, Tenant hereby covenants and agrees
to pay when due the VAT, and any and all other sums of money, charges or other
amounts required to be paid by Tenant to Landlord or to another person under
this Lease (collectively referred to herein as the "Additional Payment
Obligations"). Any nonpayment of Additional Payment Obligations when due
hereunder shall constitute a default under this Lease to the same extent, and
shall entitle the Landlord to the same remedies, as nonpayment of the Annual
Base Rent. Except as otherwise herein provided, all Additional Payment
Obligations payable hereunder shall be due within ten (10) days of the date of
Landlord's invoice therefore.
3.4 Late Charge. If Tenant shall fail to pay any Annual Base Rent or any
Additional Payment Obligations within ten (10) days after the date same is due
and payable, Tenant shall pay to Landlord an administrative fee equal to annual
rate of 2 points over the prime rate of the International Bank of Commerce,
after a grace period of 10 days of the amount due to cover Landlord's additional
administrative costs and cost of funds resulting from Tenant's failure. Such fee
shall be paid to Landlord together with such unpaid amounts and shall constitute
Additional Payment Obligations hereunder. Such late payment fee shall not
diminish or impair any other remedies available to Landlord. Landlord will
provide Tenant with written notice of such delinquency hereunder on not more
than two (2) occasions during each calendar year, and Tenant shall not be liable
for such fee relative to such delinquency if Tenant cures the delinquency within
five (5) days following Landlord's delivery of such written notice.
3.5 The Tenant hereby agrees that should the Landlord at one point obtain
a loan with a bank institute, pertaining to the Premises and or the Lease
Contract, Tenant will submit the monthly payment directly to the bank institute
rather than to Landlord immediately after Landlord advises Tenant all the
necessary information and/or documentation as to where payment should be mailed
to, accepting the conditions that the bank institution establishes.
SECTION 4
HOLDING OVER
4.1 Holding Over. Upon failure of Tenant to surrender possession of the
Premises upon the expiration of the Term of this Lease, as renewed and extended
hereunder, or the sooner termination thereof, Tenant shall pay to Landlord, as
an occupancy charge, an annual amount equal to one hundred fifty percent (150%)
of the Annual Base Rent and other sums required to be paid under this Lease with
respect to the year immediately preceding the expiration or sooner termination
of the Term of this Lease and one hundred percent (100%) of Tenant's Additional
Payment Obligations, as applied to any period in which Tenant shall remain in
possession after such expiration or sooner termination of this Lease (which
amounts shall be charged on a monthly calendar basis); the payment by Tenant and
collection by Landlord of any such amounts shall not be deemed to be the consent
of Landlord for Tenant's failure to deliver possession; and provided, further,
that in such event Tenant shall not be released from liability for any costs,
damages or liabilities whether direct, indirect or consequential, suffered by
Landlord and occasioned by Tenant's holding over.
SECTION 5
REAL ESTATE TAXES
5.1 Real Estate Taxes.
The Landlord will pay all the taxes and duties generated by the
Premises.
The Landlord shall deliver to the Tenant copies of all the tax
payments related with the Premises, in order for the latter to verify that such
payments were carried out.
SECTION 6
USE OF PREMISES
6.1 Permitted Use. Except as expressly permitted by Section 7.4, Tenant
covenants that it shall use and occupy the Premises as a facility for "light"
manufacturing, warehouse, office and other lawful, non-polluting uses accessory
and incidental to the foregoing that are consistent with the uses permitted in
other first-class industrial parks in the vicinity of the Premises, provided
that such uses do not (a) involve the manufacture, processing, use, storage or
release of explosives or "Hazardous Substances", (b) involve the release of any
noxious fumes, vapors or odors, (c) cause the emission of any noise beyond the
perimeter of the Building, or (d) violate any Permitted Encumbrances or
Restrictive Agreements applicable to the Premises. Tenant shall not use or
occupy the Premises for any other purpose or business without the prior written
consent of Landlord, which consent may be withheld or conditioned in Landlord's
reasonable discretion. Tenant shall observe and comply with all laws, rules,
regulations and ordinances applicable to the Premises and such other laws,
rules, regulations and ordinances that may require repairs or replacements,
whether structural or nonstructural, exterior or interior, foreseen or
unforeseen; Provided, however, that all "Alterations" (as defined in Section 8.1
hereof) shall be performed in accordance with Section 8. Under no conditions
whatsoever shall the Tenant be permitted to use the Premises for any activities
or operations that are in violation of any applicable municipal, state or
federal laws, regulations or ordinances.
6.2 Rules and Regulations. In addition, Landlord reserves the right to
establish rules and regulations for the Premises. Tenant shall observe and
comply with such commercially reasonable rules and regulations reasonably
established by Landlord and all modifications thereof and additions thereto from
time to time put into effect by Landlord. Landlord agrees to enforce such Rules
and Regulations against all tenants in a fair and non-discriminatory manner.
6.3 Public Utilities.
(a) Landlord will provide sanitary sewer, water, gas supplier;
telephone and electric conduit lines from the Building to the street line 3,500
kva. Such utilities will be designed to serve the Building exclusively. Tenant
shall have the responsibility to contract directly with the utility companies
for all of its utility services and arrange for the initiation, connection and
consumption of service (and meter installation) from each of the providers of
utility services and for the direct payment to such provider for all charges
relating thereto. All costs and charges associated with utility services shall
be Tenant's financial responsibility.
(b) Tenant shall be responsible for: (i) the payment of any "cuota
de cooperacion" and "cuota de aportacion" fees as may be charged for initiation
of electric service and for all connection, user and consumption fees associated
with the electric service for the Building; and (ii) the payment of all water
rights ("derecho de fuente"), connection, user and consumption fees associated
with the initiation, connection and consumption of water service at the
Building, and for the connection, consumption and user fees for all other
utilities serving the Premises. Tenant shall pay all utility expenses before the
same become delinquent or subject to the assessment of any late charge or
administrative fee by the utility company.
(c) The Landlord shall also provide the following services at the
Premises:
1. - Sufficient restrooms for men and women in the factory floor and in
the office area.
2. - Proper sanitary draining.
3. - Seal the production floor of the new building in accordance with the
proposal submitted by the Tenant, and accepted by the Landlord.
4. - Parking lot with a surface area of up to 18,000.00 Sq. Ft., and 24
spaces for visitors.
5. - The Landlord will install 7 units of air conditioning with a total of
130 tons.
Costs of the repair and on going maintenance of all units will be
obligatory to the Tenant. If due an increase of employees or equipment the
Tenant would need more a/c units, the Tenant would pay these units.
Furthermore, the Landlord commits to deliver to the Tenant copies
and/or originals of the warranties issued by the manufactured of the
aforementioned equipment. Tenant will be entitled to enforce directly all rights
and benefits of the Landlord under such guarantees or warranties.
6.4 Increased Insurance Risk. Tenant shall not do or permit anything to be
done, or keep or permit anything to be kept in the Premises, which would: (a) be
in violation of any governmental law, regulation or requirement, (b) invalidate
or be in conflict with the provision of any fire or other insurance policies
covering the Building or any property located therein, (c) result in a refusal
by fire insurance companies of good standing to insure the Building or any such
property in amounts required by Landlord's Mortgagee (as hereinafter defined) or
reasonably satisfactory to Landlord, (d) subject Landlord to any liability or
responsibility for injury to any person or property by reason of any business
operation being conducted in the Premises, or (e) cause any increase in the fire
insurance rates applicable to the Premises or property located therein at the
beginning of the Term or at any time thereafter. In the event that any use of
the Premises by Tenant increases such cost of insurance, Landlord shall give
Tenant written notice of such increase and Tenant shall pay such increased cost
to Landlord within fifteen (15) days following Landlord's delivery to Tenant of
its invoice therefor. Acceptance of such payment shall not be construed as a
consent by Landlord to Tenant's such use, or limit Landlord's further remedies
under this Lease.
SECTION 7
HAZARDOUS WASTES
7.1 Prohibition Against Use.
(a) Tenant covenants that it shall not, at any time during the Term
of this Lease, place, store, install upon, discharge, release or generate on, in
or under the Premises, or allow to escape from the Premises, any "Hazardous
Substances" (as defined below) or containers or storage or processing facilities
thereof. The term "Hazardous Substances", as used in this Lease, shall mean any:
(a) hazardous wastes and/or toxic chemicals, materials, substances or wastes
occurring in the air, water, soil or ground water at the Premises as defined in
the laws and regulations in effect during the Term in the United Mexican States
(the "Environmental Laws"); (b) any substance, the presence of which is
prohibited or controlled by any other applicable federal or state or local laws,
regulations, statutes or ordinances now in force or hereafter enacted relating
to waste disposal or environmental protection with respect to hazardous, toxic
or other substances generated, produced, leaked, released, spilled or disposed
of at or from the Premises; and (c) any asbestos or asbestos containing
materials, polychlorinated biphenyls ("PCB") in the form of electrical
equipment, fluorescent light fixtures with ballasts, cooling oils or any other
form, or any solid, liquid, gaseous or thermal irritant or contaminant, such as
smoke, vapor, soot, fumes, alkalis, acids, chemicals, pesticides, herbicides,
sewage, industrial sludge or other similar wastes, or industrial, nuclear or
medical by-products or underground storage tanks (whether filled or unfilled).
(b) Tenant shall promptly notify Landlord when Tenant becomes aware
of the presence of Hazardous Substances at levels at the Premises (not
previously authorized by Landlord) that exceed the applicable levels allowed by
the Environmental Laws of the United Mexican States. If any remedial action is
necessary or appropriate pursuant to this Section, Tenant shall determine and
undertake all such actions that are necessary to comply with the laws, statutes
and regulations of the United Mexican States applicable to Hazardous Substances.
Tenant shall remove, clean-up and remedy any Hazardous Substance on the Premises
to the extent required by applicable law, provided that the presence of such
Hazardous Substance resulted from the action or inaction of Tenant or any Tenant
Parties, and Tenant shall be obligated to continue to pay Annual Base Rent and
the Additional Payment Obligations hereunder until such removal, clean-up or
remedy is completed in accordance with applicable laws, whether or not the Term
of this Lease shall terminate or expire.
7.2 Tenant Indemnity. Tenant shall indemnify, defend and hold harmless
Landlord and/or any Mortgagee from and against any and all liability, loss,
suits, claims, actions causes of action, remediation orders, proceedings,
demands, costs, penalties, damages, fines and expenses, including, without
limitation, attorneys' fees, consultants' fees, laboratory fees and clean-up
costs, and the costs and expenses of investigating and defending any claims or
proceedings, resulting from, or attributable to, (a) the presence of any
Hazardous Substance at the Premises arising from the action, inaction or
negligence of Tenant or any Tenant Parties, or arising out of the generation,
storage, treatment, handling, transportation, disposal or release by Tenant or
any Tenant Parties of any Hazardous Substance at or near the Premises, or (b)
any violation(s) by Tenant or any Tenant Parties of any applicable law regarding
Hazardous Substances. Furthermore, upon the termination of the Lease, Tenant
shall deliver to Landlord a Site Abandonment Approval ("Abandono de Sitio")
issued by the Mexican Environmental Protection Agency ("PROFEPA") stating that
the Premises are in satisfactory condition.
7.3 Landlord Representations and Indemnity.
(a) To the best of Landlord's knowledge, there are no material
Hazardous Substances in, on, or about the Premises. Landlord covenants and
agrees that neither Landlord nor its contractors or agents shall release,
discharge, place, or install any Hazardous Substances upon the Premises or
install or incorporate any Hazardous Substances into the Building. Landlord
covenants that it previously has not, and that it shall not place, store,
install upon, discharge, release or generate on, in or under the Premises, or
allow to escape from the Premises, any Hazardous Substances. Landlord shall not
be liable to Tenant or any other party on account of, the placement, storage or
release of any Hazardous Substances affecting the Premises or any surrounding
area during the Term of this Lease expect as provided in Section 7.3(b).
Landlord shall deliver to Tenant a Site Abandonment Approval issued by PROFEPA,
stating that the Premises are in satisfactory condition.
(b) Landlord shall indemnify, defend and hold harmless Tenant from
and against any and all liability, loss, suits, claims, action, causes of
action, remediation orders, proceedings, demands, costs, penalties, damages,
fines and expenses, including, without limitation, attorneys' fees, consultants'
fees, laboratory fees and clean-up costs, and the costs and expenses of
investigating and defending any claims or proceedings (but excluding
consequential damages) arising from (a) the action, inaction or negligence of
Landlord or its contractors or agents, or arising out of the generation,
storage, treatment, handling, transportation, disposal or release by Landlord or
its contractors or agents of any Hazardous Substance at or near the Premises, or
(b) any violation(s) by Landlord of any applicable law regarding Hazardous
Substances.
7.4 Permitted Activities. Notwithstanding the provisions of this Section
7, (a) the presence of trace amounts of Hazardous Substances below the level at
which such Hazardous Substance is regulated by any applicable law of the United
Mexican States shall not constitute a violation of Tenant's representations and
covenants contained herein; and (b) Tenant may store commercial products on-site
which contain Hazardous Substances and which are used in the ordinary course of
Tenant's business provided that (i) Tenant obtains all necessary permits
therefor from the applicable governmental authorities; (ii) Tenant stores,
handles and disposes of such Hazardous Substances in conformance with all
applicable laws and regulations of the United Mexican States; and (iii) Tenant
removes all such Hazardous Substances from the Premises in accordance with
applicable laws and regulations at the expiration or sooner termination of the
Term.
SECTION 8
ALTERATIONS AND ADDITIONS
8.1 Performance by Tenant.
(a) No alteration, addition or improvement to or installation in the
Premises or any penetration of the roof (each an "Alteration") shall be made or
permitted to be made by Tenant without the express prior written consent of
Landlord, which shall not be unreasonably withheld. Landlord's consent shall not
be required with respect to non-structural Alterations made after the
Commencement Date with an aggregate contract value of up to $_20000.00_______
(determined on a cumulative basis throughout the Term) that do not involve or
affect the roof, the structural elements of the Building, or any mechanical,
electrical, plumbing, HVAC or other Building systems (the "Building Systems");
provided, however, Tenant shall provide Landlord with copies of all final plans
and specifications for such nonstructural improvements at least fifteen (l5)
days prior to the commencement of any such work.
(b) Landlord may impose reasonable conditions to its consent,
including conditions that Tenant (i) obtain Landlord's approval, not to be
unreasonably withheld or delayed, of final plans and specifications; (ii) obtain
Landlord's approval, not to be unreasonably withheld or delayed, of all
contractors and subcontractors and their respective contracts; (iii) obtain all
permits, approvals, and certificates required by any governmental or
quasi-governmental bodies and, upon completion, provide said certificates to
Landlord; (iv) carry, and cause all contractors and subcontractors to carry,
worker's compensation (to the extent the same may become applicable and
available), general liability, personal and property damage insurance; (v) agree
at its sole cost to remove any such alteration, addition, improvement or
installation on or before the expiration or sooner termination of the Term and
to restore the Premises to its prior condition (subject to Section 8.3 below);
(vi) to the extent customary in the locality, require all contractors,
subcontractors, suppliers and material to sign waiver and release of lien
agreements in form, scope and substance satisfactory to Landlord; and (vii) at
Landlord's written direction, remove any of the Alterations at the expiration of
the Term. Any such alterations, additions, improvements or installations shall
(A) in no way adversely affect the value of the Premises, (B) be performed in a
workmanlike manner; and (C) in no way violate any agreement, contract or other
document by which the Premises is bound, including-any restrictive covenants
affecting the Premises.
(c) Landlord will permit Tenant and Tenant's Contractor to enter the
Premises upon prior notice during normal business hours for the purpose of
constructing Tenant's initial Alterations as approved by the Landlord subject to
the following conditions: (i) Tenant's execution and delivery of this Lease and
Guarantor's execution and delivery of the Guaranty, (ii) Tenant's payment in
full of the Security Deposit, (iii) Tenant's delivery of all applicable
insurance certificates required by this Lease, (iv) Landlord's receipt and
approval of the Tenant's Alterations (and the plans and specifications
therefore, and (v) no Event of Default shall have occurred. Tenant's contractors
or subcontractors must work in harmony with Landlord and its employees, agents
contractors and suppliers and must not (A) take any actions that would cause
interference with any activities related thereto, or (B) violate any of
Landlord's Rules and Regulations or directions related to Tenant's construction
activities at the Building. Until such time as the Premises are ready for
Occupancy, Tenant's contractors and subcontractors shall have access to the
Premises solely in connection with the performance of Tenant's Alterations. Any
entry by Tenant or its agents, engineers, contractors, subcontractor,
materialmen and any other party given access to the Premises in connection
therewith ("Tenant's Agents and Consultants") shall be at the sole risk of such
party and without liability to Landlord, its agents, employees, officers,
directors, principals, partners, shareholders and affiliates. Tenant agrees to
keep the Premises clean and free at all times of any obstructions, supplies,
equipment and materials brought into the building by Tenant or Tenant's Agents
or Consultants; comply with Landlord's Rules and Regulations applicable to
Tenant's Alteration activities and the activities of Tenant's Agents and
Consultants; and comply with Landlord's directions and requirements concerning
the use and the time of use of the means of ingress to, and egress from, the
Building with respect to Tenant's Alteration activities at the Building. All of
Tenant's construction activities shall be coordinated with Landlord and subject
to Landlord's requirements to prevent interference with the Building's
operations.
8.2 Liens.
(a) Tenant shall keep the Premises free and clear of all liens and
encumbrances except the Permitted Encumbrances and any liens or encumbrances
arising from the acts of the Landlord. If any lien shall be filed against the
Premises or the Building purporting to be for labor or material furnished or to
be furnished at the request of the Tenant, then Tenant shall at its expense
cause such lien to be discharged of record by payment, bond or otherwise, within
thirty (30) days after the filing thereof. If Tenant' shall fail to cause such
lien to be discharged of record within such thirty (30) day period, in addition
to any other remedy available to it for such a default, Landlord may cause such
lien to be discharged by payment, bond or otherwise, without investigation as to
the validity thereof or as to any offsets or defenses thereto, and Tenant shall,
upon demand, reimburse Landlord for all amounts paid and costs incurred
including attorney's fees, in having such lien discharged of record.
(b) In the event Tenant in good faith desires to contest the
validity or amount of any lien referred to in this Section 8.2, Tenant shall
have the right to contest the validity or amount of any such lien or other lien
referred to in this Section 8.2 at its own expense, by appropriate legal
proceedings, promptly initiated and conducted in good faith and with due
diligence; that (i) no default or Event of Default exists under this Lease, (ii)
Tenant has given prior written notice to Landlord of Tenant's intent to take
such action, (iii) neither the Premises nor any part thereof or interest therein
will, in the reasonable opinion of Landlord, be in danger of being sold,
forfeited, terminated, cancelled or lost, (iv) such action shall not subject
Tenant or Landlord to criminal or civil liability.
8.3 Removal of Alterations. All alterations, additions, improvements and
installations, which may be made to, the Premises shall become the property of
Landlord upon installation and shall remain upon and be surrendered with the
Premises, unless Landlord identifies any proposed improvement as an item that
must be removed at the end of the term at the time approval is solicited by
Tenant in accordance with Section 8.1(a). Notwithstanding the foregoing,
Tenant's personal property and trade fixtures, other than that which is affixed
to the Premises so that it cannot be removed without material damage to the
premises, shall remain the property of Tenant and may be removed by Tenant at
any time during the Term. Tenant's goods, effects, personal property, business
and trade fixtures, machinery and equipment not removed by Tenant at the
expiration of this Lease (or within thirty (30) days after any other
termination) shall be considered abandoned and Landlord may dispose of the same
as it deems expedient, but Tenant shall promptly reimburse Landlord for any
expenses incurred by Landlord in connection therewith including, without
limitation, the cost of removal thereof and repairing any damage occasioned by
such removal. Tenant shall coordinate its plans to remove such items with
Landlord in advance of any removal activities and obtain Landlord's prior
written approval of the quality and manner of the repair and restoration work.
Tenant shall not undertake any such activities that affect the roof (or any of
its structural components) without Landlord's prior written consent. Tenant
agrees to repair as soon as practicable, at its sole cost and expense, any and
all damage to the Premises caused by, or in connection with, the removal of any
articles of personal property, business or trade fixtures, alterations,
improvements and installations, normal wear and tear excepted.
SECTION 9
TENANT'S MAINTENANCE AND REPAIR OF THE PREMISES
9.1 Tenant's Obligations. Tenant shall be responsible for payment of all
expenses and charges relating to the operation, repair and maintenance of the
Premises including the Value Added Taxes relative thereto, but excluding any
taxes payable by Landlord. Tenant shall be responsible for and shall provide, at
its own cost and expense, the maintenance, repair and services for the Premises
as stated in the immediately preceding sentence including, without limitation,
the following utilities and facilities in and about the Premises (including
capital repairs and replacements in connection therewith) subject to Landlord's
obligations:
(a) Any and all oil, gas, electricity, water, telephone, sanitary
sewer, storm or drainage sewer and all other utilities utilized in or about the
Premises (including all utility lines, conduits, and related equipment);
(b) All heating, ventilating and air-conditioning systems and
conduits (including the component equipment and machinery) and the operation of
adequate air conditioning and heating in such respective amounts as necessary to
protect and preserve the Building;
(c) All electrical, mechanical and plumbing systems (including
component equipment and machinery);
(d) All restrooms, and all plumbing and sewer lines in and about the
Premises,
(e) All electrical wires, cable, fixtures, outlets and boxes in and
about the Premises;
(f) All load leveler, including the component equipment and
machinery;
(g) All hardware installed in the Building, including, but not
limited to, hardware items such as doorknobs, urinals, sinks, faucets, etc.; and
(h) Other maintenance (including the responsibility to pay its share
(based upon the rentable square footage of the Premises relative to the rentable
square footage of the other buildings) of any and all maintenance costs and
expenses assessed by any present or future industrial park association or
similar body), except for items that are Landlord's obligations under Section
10.1 of this Lease, as may be required to preserve and protect the Premises and
its constituent parts. Any payment of the items mentioned in Section 9 herein,
if paid by the Landlord should be considered as an Additional Payment
Obligation.
9.2 Maintenance of the Premises. Tenant covenants and agrees to use,
maintain and occupy the Premises in a careful, safe and proper manner which will
neither injure the reputation of either Landlord or Tenant nor use the Premises
in a manner which renders it a nuisance to any other tenants of the Building, or
users or tenants of adjacent buildings. No outside storage of any equipment,
inventory, products or any materials whatsoever shall be permitted. Tenant, at
its own expense, shall at all times maintain the Premises in a first-class
manner and to no less a standard than that of comparable general purpose "light"
manufacturing buildings in the vicinity of the Premises and in compliance with
those standards imposed by any insurance policies required to be maintained
hereunder, (including capital repairs and replacements). Tenant shall keep
maintenance and repair reports in sufficient detail to indicate the nature and
date of major work done. Tenant shall, at its own cost and expense, keep the
Premises and all leasehold improvements therein, including all parking areas and
sidewalks, in a clean, safe and healthy condition and shall clean the dirt and
rubbish from the parking areas and sidewalks on the Premises during the Term of
this Lease. In the event that any of the parking areas, sidewalks, or other
parts of the Premises shall be in an unsafe, unclean, or unsightly condition,
Tenant shall commence the curing of such condition within ten (10) days
following receipt of Landlord's notice of such condition and diligently and
continuously prosecute such curative action to completion.
9.3 Tenant's Repairs. Other than Landlord's obligations expressly stated
in Section 10.1 of this Lease, at all times during the Term of this Lease,
Tenant shall make, at its sole cost and expense, any and all necessary repairs
and capital improvements to the Premises, both structural (excluding the items
identified as Landlord's responsibility in Section 10.1) and non-structural in
order to preserve, protect, and maintain the Premises to their condition as of
the date thereof, normal wear and tear excepted, or to such superior condition
as Tenant may desire, as provided in this Article 9 hereof and all other items
which constitute a part of the Building and the Premises. Tenant in accordance
with Section 8 shall perform any repairs and capital improvements, which
constitute Alterations, hereof. Tenant's obligation for repairs extends to
repairs made after the Tenant has vacated the Premises, which were necessary
because of Tenant's use or occupancy of the Premises.
9.4 Exterior Maintenance. Tenant shall, at its own cost and expense,
maintain all lawns, gardens, trees, shrubbery, exterior landscaping and all
parking, loading and other exterior areas at the Premises and keep the same
clear and free from accumulations of any debris, rubbish and garbage and keep
such outside areas of the Premises in such condition as consistent with
professionally landscaped buildings.
9.5 Refuse Removal. Tenant shall, at its own cost and expense, provide for
all trash, garbage, and refuse removal from the Premises at all times during the
Term of this Lease. Tenant shall at all times comply with all health and safety
laws, rules, regulations and ordinances with respect to the storage and removal
of trash, garbage and refuse on and from the Premises.
9.6 Tenant's Failure to Repair. If Tenant refuses or neglects to commence
any repairs or fails to diligently prosecute the same to completion within
twenty (20) days from the date on which Tenant receives written notice from
Landlord of the need therefore, or if Tenant fails to make emergency repairs or
diligently prosecute the same within such time as is necessary to avoid risk or
damage to the Premises, Landlord may make such repairs at the expense of Tenant
and such expense plus fifteen percent (15%) for Landlord's cost of
administration and overhead shall be paid by Tenant to Landlord within five (5)
days following completion and written demand as Additional Rent hereunder.
SECTION 10
LANDLORD'S MAINTENANCE AND REPAIR OF THE PREMISES
10.1 Landlord's Obligations. After the Occupancy Date Landlord shall have
no obligation to maintain or repair, or provide any service to, the Premises
except as stated in this Section 10.1. Landlord, at its sole cost and expense,
shall maintain (and make any necessary repairs and replacements) the following
structural components of the Building in good condition, repair, reasonable wear
and tear excepted throughout the Term: (a) the foundation, (b) the footings, (c)
the load-bearing and exterior walls, (d) the steel joists and supporting
columns, and (e) the roof and the roof membrane. It shall be a condition
precedent to Landlord's responsibility for the roof of the Building that Tenant
makes no penetrations of the roof.
SECTION 11
NET LEASE; TENANT'S OBLIGATIONS FOR COSTS
11.1 Net Lease. This Lease is a net lease, it being understood that
Landlord shall receive the Annual Base Rent set forth herein free and clear of
any and all impositions, taxes, utilities, liens, charges or expenses of any
nature whatsoever in connection with the ownership, maintenance, repair and
operation of the Premises, except as specifically provided in this Lease. As
provided in this Lease, Tenant shall pay certain Additional Payment Obligations
including, without limitation, the VAT, and the insurance premiums for the
coverage required by Section 17. Any present or future law to the contrary
notwithstanding, this Lease shall not terminate except as expressly provided
herein, nor shall Tenant be entitled to any abatement, suspension, deferment,
reduction, setoff, counterclaim, or defense with respect to any Annual Base
Rent, Additional Payment Obligations or other sum payable hereunder other than
as expressly provided herein.
11.2 Non-Terminability. To the extent permitted by applicable law, Tenant
shall remain obligated under this Lease in accordance with its terms and shall
not take any action to terminate, rescind or avoid this Lease, or any of its
payment obligations, notwithstanding any action for bankruptcy, insolvency,
reorganization, liquidation, dissolution or other proceeding affecting Landlord,
or any action with respect to this Lease which may be taken by any trustee,
receiver or liquidator of Landlord or by any court in respect of Landlord,
except as such right may be expressly granted to Tenant in this Lease.
11.3 Rent Acceleration. Except as otherwise expressly provided in this
Lease (and subject to the provisions of applicable law and Tenant's cure rights
under Section 20.1(f)), if Tenant seeks to modify, amend, cancel in whole or in
part, or have declared null, whether in whole or in part this Lease Agreement,
and whether or not successful, Landlord shall have the right to accelerate all
rentals and other payments payable under this Lease Agreement as herein defined
(collectively the "Rent Payable"), in addition to any other remedy available to
Landlord. "Rents Payable" for purposes herein is defined as the total amount of
Annual Base Rent and Additional Payment Obligations to be paid for the entire
Term of this Lease Agreement, provided in Section 3 hereof, discounted to
present value as provided in Section 21.1(a).
SECTION 12
RESTRICTIONS ON TRANSFER. ASSIGNMENT AND SUBLETTING
12.1 Assignment or Sublease. Except as provided in Section 12.3 hereof,
Tenant, expressly covenants that Tenant shall not, assign, transfer, mortgage or
encumber this Lease or any interest therein, directly or indirectly, or sublet
the Premises or any part thereof or grant any license, concession or other right
of occupancy, or permit any part thereof to be used or occupied by anyone other
than Tenant without the prior written consent of Landlord (any such action, a
"Transfer"), which consent shall not be unreasonably delayed or withheld,
provided the following conditions are complied with:
(a) Tenant shall provide written notice of any proposed Transfer to
Landlord at least thirty (30) days in advance of the date on which Tenant
desires to make such Transfer, which notice shall specify: (1) the name, address
and business of the proposed assignee, sublessee or other transferee (the
"Transferee"), (2) the amount and location of the space in the Premises
affected, (3) the proposed effective date and duration of the Transfer, (4) a
certified financial statement indicating the financial worthiness of the
proposed Transferee, (5) a copy of the proposed assignment, sublease or other
document (the "Transfer Document") which shall include the proposed rent to be
paid by any assignee or sublessee, and (6) any other information about the
proposed Transferee as Landlord may reasonably request.
(b) Any Transfer shall not transfer or avoid Tenant's duties and
obligations under the Lease or Guarantor's obligations under the Guaranty and
the Tenant named herein shall continue to be liable for all of its obligations
hereunder and the Guarantor shall continue to be liable for all of its
obligations under the Guaranty, in each case as though no Transfer had been
made.
(c) At the time of any Transfer, this Lease must be in full force
and effect, and no Event of Default shall have occurred and be continuing.
(d) The Transferee shall agree in writing to be bound by the terms
of this Lease pursuant to an assumption agreement in form and substance
satisfactory to Landlord. A copy of the assignment, sublease or other Transfer
Document fully executed and acknowledged by Tenant and Transferee shall be
mailed to Landlord ten (10) days prior to the effective date of such Transfer.
(e) The financial net worth and creditworthiness of the Transferee
shall be acceptable to Landlord (as substantiated by its audited financial
statements or other comparable financial information reasonably satisfactory to
Landlord).
(f) The Guarantor shall deliver to Landlord an instrument in form
and substance satisfactory to Landlord and any Mortgagee whereby Guarantor
consents to such Transfer and ratifies and confirms the continuing validity of
its Guaranty (a "Ratification Agreement") at least ten (10) days prior to the
effective date of such Transfer.
(g) Any Transfer shall comply with the requirements of all financing
documents applicable to the Premises. Any Mortgagee or other party whose
approval is required shall have approved the Transfer Document.
(h) In the case of an assignment or sublease, each Transfer Document
permitted under this Section 12 shall contain provisions to the effect that (1)
such assignment or sublease is only for actual use and occupancy by the
Transferee; (2) such assignment or sublease or other Transfer is subject to all
of the terms, covenants and conditions of this Lease and to all of the rights of
Landlord hereunder; and (3) in the event this Lease shall terminate before the
expiration of such assignment or sublease or other Transfer, the Transferee
thereunder will, at Landlord's option, attorney to Landlord and waive any rights
to surrender possession thereunder, as a result of the termination of this
Lease.
(i) No Transferee of this Lease shall engage in any business or
activities which produce, use, store or process any Hazardous Substances as
defined in Section 7 of this Lease or shall otherwise be in violation of the use
restrictions contained in Section 6 of this Lease.
(j) Tenant agrees to pay on behalf of Landlord any and all costs of
Landlord, including reasonable attorneys' fees, occasioned by such Transfer, or
Landlord's or any Mortgagee's approval thereof.
12.2 Landlord Approval. Landlord shall have a period of fifteen (15) days
following receipt of notice given by Tenant pursuant to Section 12.1 above
within which to notify Tenant in writing that Landlord elects either (a) to
permit Tenant to make such Transfer; or (b) to withhold Landlord's consent in
its reasonable discretion and to continue this Lease in full force and effect.
No consent given by Landlord to any Transfer shall be construed to be a consent
to any further Transfer of the Premises by Tenant or any other party, or a
release of Tenant's liability under this Lease, and Landlord's right to withhold
its consent with respect thereto is hereby expressly reserved.
12.3 Permitted Transactions. Tenant may assign this Lease or sublet the
Premises or any portion thereof without Landlord's consent (except as to the
form of assignment or sublease) to (a) any corporation or limited liability
company which controls, is controlled by or is under common control with Tenant,
or (b) to any corporation resulting from a merger or consolidation with Tenant,
or to any person or entity which acquires all of the assets of Tenant's business
as a going concern, (a "Merger Transaction") provided that:
(a) At least twenty (20) days prior to such assignment or sublease,
Tenant delivers to Landlord the financial statements and other financial
background information of the assignee or sublessee described in Section 12.1
above and the proposed form of assignment or sublease;
(b) If an assignment, the assignee assumes, in full, the obligations
of Tenant under this Lease (or if a sublease, the sublessee of a portion of the
Premises or Term assumes, in full, the obligations of Tenant with respect to
such portion and the Transferee has a financial net worth that equals or exceeds
that of the Tenant on the date hereof);
(c) Tenant remains fully liable under this Lease (except as may
otherwise be permitted by a Merger Transaction);
(d) The financial net worth and creditworthiness of the Transferee
shall be acceptable to Landlord (as substantiated by its audited financial
statements);
(e) The financial net worth of Guarantor shall be equal to or exceed
the net worth of Guarantor on the date of execution of this Lease and the
Guaranty shall remain in full force and effect;
(f) Guarantor provides Landlord with a Ratification Agreement
together with evidence reasonably acceptable to Landlord that the conditions of
subsection (d) have been satisfied;
(g) The use of the Premises permitted under Section 6.1 of this
Lease remains unchanged;
(h) No Event of Default shall have occurred and be continuing at the
time of such Transfer or after giving effect to the Merger Transaction; and
(i) Such transaction is not entered into as a, subterfuge to avoid
the restrictions and provisions of this Section 12.3.
In addition to the foregoing, the following conditions must also be
fulfilled in connection with a Merger Transaction: (a) the surviving entity is a
statutory business entity organized under the laws of the United Mexican States,
or the United States of America (or any state thereof) which is in full
compliance with all applicable Mexican "doing business," foreign ownership of
real estate, foreign registration and related laws and regulations, (b) the
surviving entity or the entity to which all or substantially all of the assets
are sold shall have tangible net worth immediately following the Merger
Transaction of no less than the net worth of the Tenant as calculated on the
Commencement Date, (c) the surviving entity (if not the Tenant) or, in the case
of a sale of all or substantially all of the Tenant's assets, the entity which
has purchased such assets shall have delivered to the Landlord and any Mortgagee
an instrument in recordable form and in form and substance reasonably
satisfactory to the Landlord and any Mortgagee whereby the surviving entity
assumes the obligations of the Tenant under this Lease.
SECTION 13
INSPECTION
13.1 Inspection. Landlord and its employees, servants and agents shall
have the right to enter the Premises during normal business hours upon at least
one (1) business day's prior notice (except in emergencies) for the purpose of
showing the same to prospective purchasers, Mortgagees, or tenants of the
Premises, or for making such alterations, repairs, improvements or additions to
the Premises in accordance with the provisions of this Lease, or examining or
inspecting the Building in order to ascertain whether Tenant is complying with
all of its obligations hereunder. Landlord agrees that each such entry shall be
conducted in a reasonable manner that will be the least intrusive to Tenant's
business operations relative to the purpose of the entry. Notwithstanding
anything to the contrary in the preceding sentence, except in emergencies,
Landlord and its employees, servants and agents shall not enter any area of the
Premises that may result in the disclosure of commercial or industrial trade
secrets of Tenant and Tenant shall have the right to have a representative
accompany Landlord throughout the Premises. Landlord's entry pursuant hereto
shall not constitute an eviction of Tenant in whole or in part, and the Rent
shall in no way xxxxx while any alterations, repairs, improvements or additions
are being made, whether by reason of loss or interruption of Tenant's business
or otherwise. If representatives of Tenant shall not be present to open and
permit entry into the Building at any time during an emergency, Landlord may
enter the Building by means of a master key or forcibly without liability to
Tenant.
SECTION 14
SURRENDER OF PREMISES
14.1 Condition of Premises. At the end of the Term, or any renewal or
extension thereof, Tenant shall surrender the Premises to Landlord, together
with all alterations, additions, renovations and improvements thereto specified
in Section 8.3, in compliance with all applicable laws, rules, regulations and
ordinances and any restrictive covenants, and in broom-clean condition and in
good order and repair except for ordinary wear and tear, failing which Landlord
may restore the Premises to such condition and Tenant shall pay the cost of said
repair and restoration. Tenant shall surrender the Premises to Landlord at the
end of the term hereof, without notice of any kind, and Tenant waives all right
to any such notice as may be provided under any laws now or hereafter in effect.
Tenant's obligation to observe or perform this covenant shall survive the
expiration or other termination of the Term of this Lease.
SECTION 15
WAIVER OF CLAIMS: INDEMNIFICATION AND LIABILITY
15.1 Waiver of Claims. Landlord and Landlord's agents, servants and
employees shall not be liable for, and Tenant hereby releases Landlord, its
agents, servants and employees from, all liability in connection with any and
all loss of life, personal injury, damage to or loss of property, or loss or
interruption of business occurring to Tenant, its agents, servants, employees,
invitees, licensees, visitors or any other person, firm, corporation or entity,
in or about or arising out of, in or upon the Premises, including, without
limitation, (a) any fire, other casualty, accident, occurrence or condition; (b)
any defect in or failure of (i) plumbing, sprinkling, electrical, heating or air
conditioning systems or equipment, or any other systems and equipment, and (ii)
the stairways, railings or walkways; (c) any steam, gas, oil, water, rain,
frost, ice, snow, or flooding that may leak into, issue or flow from any part of
the Premises or from the drains, pipes or plumbing, sewer or other installation
of same, or from any other cause, place or quarter; (d) the breaking or
disrepair of any services, installations and equipment; (e) the falling of any
fixtures or any wall or ceiling materials; (f) broken or dislodged glass; (g)
patent or latent defects; (h) the carrying out of any construction work or
repairs; (i) any acts or omissions of other persons; (j) acts or omissions of
third party contractors, and (k) theft, act of God, act of a public enemy,
injunction, riot, strike, labor dispute, public demonstration, insurrection,
war, court order, or any order of any governmental authority having jurisdiction
over the Premises, but excluding any liability resulting from the gross
negligence or willful misconduct of Landlord.
15.2 Indemnification and Liability.
(a) Tenant's Indemnity. Unless arising out of the negligence or
intentional misconduct of Landlord, its agents or employees, Tenant shall
protect, defend, indemnify, and hold harmless Landlord from and against any and
all costs, expenses (including reasonable attorneys' fees), liabilities, losses,
damages, suits, actions, fines, penalties, claims or demands of any kind to the
extent such items arise out of or are in any way connected with, and Landlord
shall not be liable to Tenant on account of (a) any failure by Tenant to perform
any of the agreements, terms, covenants, or conditions of this Lease required to
be performed by Tenant, (b) any failure by Tenant to comply with the statutes,
ordinances, laws, rules, regulations or orders of any governmental authority,
(c) any act or omission of Tenant or any Tenant Parties, (d) any accidents,
death or personal injury occurring in, on or about the Premises, or (e) Tenant's
use or occupancy of the Premises.
(b) Landlord's Indemnity. Unless arising out of the negligence or
intentional misconduct of Tenant or any Tenant Parties, Landlord will indemnify
and save harmless Tenant of and from any and all fines, suits, claims, demands,
penalties, losses and actions (including reasonable attorneys' fees) for any
injury to persons or damage to or loss of property in or about the Premises
which are caused by the gross negligence, willful misconduct or breach of this
Lease by Landlord; provided, however, that Landlord's indemnity shall not apply
or extend to any such damage or injury which occurs within the Premises or any
area covered by any insurance maintained by Tenant (or which would have been
covered had Tenant obtained insurance required under the Lease).
(c) Effect of Mutual Waiver. The foregoing indemnity obligations are
expressly subject to the provisions of Section 17.4.
SECTION 16
CASUALTY AND CONDEMNATION.
16.1 In the event of a casualty suffered by the Premises, Tenant shall
immediately notify Landlord in writing and Landlord shall commence the
procedures for the determination of damages. In the event of any casualty to the
Premises, Landlord and/or Tenant shall have the right to terminate this
Agreement if (i) such casualty affects (100%).
(b) If this Agreement is not terminated pursuant to paragraph 16.1 (a)
hereof, then Landlord, to the extent of insurance proceeds received therefore,
shall restore the Premises to the condition existing as of the date hereof, and
Tenant, at its sole cost and expense, shall restore all leasehold improvements
and/or any other improvements constructed by Tenant within the Premises.
(c) During any period during which the Premises are untenable as a result
of any casualty, the Annual Base Rent shall xxxxx under this Agreement in
proportion to floor area of the Premises rendered untenable to the remaining
portion of the Premises, continuing until Landlord substantially completes
Landlord's restoration obligations hereunder.
16.2 Condemnation.
(a) If the whole or any part of the Premises shall be taken under
the power of condemnation, eminent domain or any act by a governmental authority
(a "Condemnation"), whether rendered wholly or partially untenantable, Landlord
shall negotiate, adjust and appeal the claim for any award or compensation on
account of any such Condemnation and shall take all appropriate action in
connection therewith.
(b) In the event that all or substantially all of the Premises shall
be subject to Condemnation, this Lease and the term and estate hereby granted
shall automatically terminate as of the date of dispossession of Tenant as a
result of such Condemnation.
(c) In the event that forty percent (40%) or less of the rentable
area of the Building shall be taken by Condemnation, and Tenant can use the
Building for the same purpose as prior thereto without material impairment to
its business operations, this Lease shall continue in full force and effect. The
Term shall expire only as to the portion of the Building so taken, effective on
the date of dispossession of Tenant. In the event that more than 40 % of the
rentable area of the Building shall be taken by Condemnation and the Building
can no longer be used for the same purpose or Tenant's ability to conduct its
business operations is materially impaired by the Condemnation, Landlord or
Tenant shall have the option to terminate this Lease within the three (3) month
period following the Condemnation by giving written notice that substantiate the
basis for Tenant's of exercise this termination option.
(d) In the event that this Lease is not terminated in accordance
with subsection (b) or (c) hereof, Landlord shall, upon receipt of the award in
Condemnation, make all necessary repairs or alterations to the Building so as to
constitute the remaining Building a complete architectural unit to the extent
feasible as promptly as possible (but not in excess of 180 days after receipt of
such Condemnation award monies unless due to delays caused by Tenant or Force
Majeure Delay), but Landlord shall not be required to spend for such work an
amount in excess of the amount received by Landlord as damages for the part of
the Premises so taken. "Amount received by Landlord" shall mean that part of the
award in condemnation which is free and clear to Landlord of any collection by
mortgagees and after payment of all costs involved in collection, including but
not limited to attorney's fees. Tenant, at is own cost and expense shall,
restore all trade fixtures, equipment, furniture, furnishings and other
installations of personal property of Tenant which are not taken to as near its
former condition as the circumstances will permit. In the event of a partial
taking, all provisions of this Lease shall remain in full force and effect.
(e) Any payment or recovery received from the governmental authority
related to the Condemnation shall belong to Landlord; provided, however, that
Tenant also retains its rights, if any, to make claims against any governmental
authority for Tenant's relocation expenses, provided that Landlord's award is
not diminished thereby, and any recovery received by Landlord for such
relocation expenses shall belong to Tenant.
(f) In the event of a Condemnation or other taking that does not
result in a termination of this Lease as to the entire Premises, then the Annual
Base Rent shall be adjusted in proportion to that portion of the Building taken
by such Condemnation.
(g) Except as otherwise expressly provided in this Section, in any
event where Tenant loses the use of the Premises and the Lease is terminated,
Tenant and not Landlord shall bear the business cost to move Tenant's operations
to other facilities.
16.3 Escrow for Disbursement of Casualty and Condemnation Proceeds.
(a) In the event of a Casualty, Tenant and Landlord agree to deposit
the "Net Insurance Proceeds" (defined below) immediately upon receipt thereof in
escrow with the financial institution which is the first Mortgagee or the
financial institution designated by such first Mortgagee to act as its agent
(such Mortgagee when so acting, or its agent when so designated, the
"Depositary"), or, in the absence of any Mortgagee, the Depositary shall be
mutually agreed upon by Landlord and Tenant. The Depositary shall hold the Net
Insurance Proceeds in trust in an interest bearing money market account and
shall disburse such Net Insurance Proceeds to Tenant in accordance with the
terms and conditions of subsection (c) below to: (i) Tenant to fulfill its
obligations under Section 16.1(b); or (ii) Landlord to fulfill its obligations
under Section 16.1 (b) hereof. "Net Insurance Proceeds" (as used herein) means
the insurance proceeds received by Tenant and/or Landlord less the amount of any
reimbursement to Tenant and/or Landlord for administrative fee for collecting
the same, and all costs and expenses incurred in connection with the collection
of such proceeds. Tenant and/or Landlord shall also deposit with the Depositary
within five (5) calendar days of written demand therefor by the other party such
additional monies (the "Party Contributions") as are necessary so that the Net
Insurance Proceeds at any time held by Depositary and such Party Contributions
will be sufficient, in the reasonable judgment of the other party, to pay all of
the costs and expenses of the reconstruction and repair of the Building and of
the improvements made by Tenant, as the case may be. Once so deposited by Tenant
and/or Landlord with the Depositary, such Party Contributions shall become a
part of the Net Insurance Proceeds and shall be held and administered in the
same manner.
(b) In the event of a Condemnation and Landlord elects to
reconstruct and repair the Premises, Landlord and Tenant agree to deposit the
"Net Condemnation Proceeds" (as defined below) in escrow with the Depositary;
provided, however, Tenant shall not be obligated to deposit any award made to
Tenant for its personal property. The Depositary shall hold the Net Condemnation
Proceeds in trust in an interest bearing account (subject to the investment
directions of Landlord and Tenant with respect to the sums deposited by each
respectively) and shall disburse such Net Condemnation Proceeds to Landlord and
Tenant respectively in accordance with the terms and conditions of subsection
(c) below. "Net Condemnation Proceeds" (as used herein) means the Condemnation
awards received by Landlord and Tenant less the amount of any reimbursement to
Landlord and Tenant for reasonable administrative fees for collecting the same,
and all costs and expenses incurred in connection with the collection of such
awards.
(c) The disbursement of the Net Insurance Proceeds and Net
Condemnation Proceeds deposited with the Depositary pursuant to subsection (a)
or (b) of this Section 16.3 and the reconstruction and repair of the Premises
shall be accomplished pursuant to the following requirements:
(i) Landlord and/or Tenant, as the case may be, shall submit
to the first Mortgagee plans and specifications, a budget for the costs for such
restoration, proposed contracts and subcontracts, a construction schedule, and
lien waivers, which items shall be reasonably satisfactory to Landlord and the
first Mortgagee;
(ii) The restoration shall be conducted under the supervision
of an architect, engineer or general contractor selected by Tenant and Landlord
who shall be reasonably satisfactory to Landlord and the first Mortgagee, and in
accordance with such approved plans and specifications;
(iii) Disbursement shall be made on a progress basis (but not
more frequently than monthly) subject to: (A) first Mortgagee obtaining a
certificate executed by Tenant and Tenant's general contractor (or Landlord and
Landlord's general contractor, as the case may be) indicating that the requested
disbursement is to pay for costs of restoration (materials installed and work
and labor performed) not previously paid, and that the amount of the
disbursement does not exceed the aggregate of costs incurred or paid on account
of restoration; and (B) first Mortgagee obtaining evidence that no notices of
mechanics' or other liens or encumbrances on the Premises arising out of the
restoration exist, and to the extent applicable, appropriate lien waivers;
(iv) Upon completion of the restoration to the satisfaction of
first Mortgagee, the balance of the Net Insurance Proceeds, if any, being held
by the Depositary shall be paid to Tenant, if the restoration resulted from a
casualty and to Landlord if the restoration resulted from a condemnation; and
(v) Such other commercially reasonable terms and conditions as
may be customarily required by first Mortgagee in its commercial construction
loan administration for similar properties and construction budgets of a similar
value and type of work.
SECTION 17
INSURANCE
17.1 Tenant's Insurance. Tenant shall, at its own cost and expense, obtain
or cause to be obtained, insurance policies naming the Landlord as additional
named insured as to the coverage required under clauses (a), (b) and (g), as an
additional named insured as to the coverage required under clause (c) and as
loss payee as to the coverage required under clause (f), insuring against the
following risks, in the following amounts:
(a) "All Risk" of "Full Coverage" property insurance, including
standard fire and extended coverage insurance at all times in an amount equal to
100% of the full replacement cost and full insurable value of the Premises;
(b) Machinery coverage on all building systems at all times in an
amount equal to 100% of the full replacement cost and full insurable value of
the Premises insuring against all losses and damages arising from such
occurrences not covered by All Risk Coverage;
(c) Comprehensive general liability insurance with a minimum limit
of US Dollars $50,000.00 per person and US Dollars $ 100,000.00 per occurrence,
and property damage coverage with a minimum limit of US Dollars $100,000.00.
(d) Any insurance coverage required of Tenant by any applicable laws
of the United Mexican States;
(e) Business interruption insurance covering expenses of operating
the Premises, for a period of not less than twelve (12) months following any
damage to or destruction of the Premises;
(f) Rental income loss insurance in an amount of at least the
Tenant's Annual Base Rent and Additional Payment Obligations due hereunder for a
period of not less than twelve (12) months following any damage or destruction
to the Premises; and
(g) Builder's Risk insurance during the performance by Tenant of any
Alterations by Tenant, which will be contracted for by Tenant prior to beginning
any alterations.
Upon written request by Landlord, Tenant agrees to increase, within a
commercially reasonable period of time, the amounts of the insurance coverage,
described above so as to conform the amounts of insurance with the insurance
requirements consistent with the prevailing insurance amounts for similar
buildings in the immediate vicinity (10 mile radius) of the Premises.
17.2 Additional Insurance Requirements. All of the insurance policies
(including endorsements) required hereunder: (a) shall expressly provide that
the coverage shall not be materially changed, reduced or canceled absent thirty
(30) calendar days' prior written notice to the Landlord; (b) shall be limited
to insure Landlord's insurable interest alone (and not that of Tenant) or if
said policies are to include the insurable interest of Tenant, shall contain an
endorsement to the effect that Landlord's insurable interest shall not be
reduced or invalidated by any act or neglect of Tenant or of any subtenant of
the Premises, nor by the use of the Premises by such party for purposes more
hazardous than are permitted by the policy; (c) shall not contain any clause
which would result in the insured thereunder being required to carry insurance
with respect to the Premises or the property covered thereby, in an amount equal
to a minimum specific percentage of the full replacement cost of such property
in order to prevent the insured named therein from becoming a co- insurer of any
loss under such policy; and (d) shall be payable in the United States in U.S.
dollars. The Tenant shall provide the Landlord, within ten (10) business days
following Landlord's written request, with certified copies of said insurance
policies from the insurers at such times as may be necessary (but in no event
less than once each year) to show that insurance is being maintained as required
by this Section 17. In the event Tenant shall fail to deliver to Landlord such
certified copies of policies evidencing that the same are in full force and
effect, Landlord may undertake to obtain such insurance and the full cost
thereof shall be payable hereunder by Tenant as an Additional Payment
Obligation.
17.3 Landlord's Insurance. Landlord shall obtain and keep in force during
the Term, Commercial general liability insurance in such amounts, as Landlord
deems advisable from time to time insuring Landlord against liability arising
out of its maintenance and repair obligations under Section 10 hereof.
17.4 Waiver of Subrogation.
(a) Each party waives claims arising in any manner in its favor (as
an injured party) and against the other party for loss or damage to the injured
party's property located within or constituting a part or all of the Premises.
This waiver applies only to the extent the loss or damage is covered by: (a) the
injured party's insurance; or (b) the insurance that the injured party is
required to carry under Section 17, whichever is greater. The waiver also
applies to each party's directors, officers, employees, shareholders, members
and agents. The waiver does not apply to claims caused by a party's willful
misconduct.
(b) Landlord and Tenant agree that all insurance policies covering
loss or damage to property and business interruption or rent loss required
hereunder, shall be endorsed to provide that any release from liability of, or
waiver of claim for, recovery from the other party entered into in writing by
the insured thereunder prior to any loss or damage shall not affect the validity
of said policy or the right of the insured to recover thereunder. Such insurance
policies shall further provide that the insurer waives all rights of
subrogation, which such insurer might have against the other party. Without
limiting any release or waiver of liability or recovery contained in any other
section of this Lease, but rather in confirmation and furtherance thereof, each
of the parties hereto waives all claims for recovery from the other party for
any loss or damage to any of its property or damages as a result of business
interruption, rent loss or liability of the types covered in Section 17.1 and
17.2 above insured under valid and collectible insurance policies, but only to
the extent of any recovery collectible by the insured under such insurance
policies.
SECTION 18
SUBORDINATION AND ATTORNMENT
18.1 Subordination. Tenant agrees, at the request of Landlord, to
subordinate this Lease (including any renewals, extensions and modifications) to
any mortgage placed upon the Premises (or any portion thereof), provided that
the Mortgagee agrees to recognize the Tenant's rights under this Lease and not
to disturb the possession, use and other rights of Tenant under this Lease
subject to the condition that Tenant continues to perform its obligations
hereunder and is not in default of such obligations. In the event of acquisition
of title to the Premises by said Mortgagee or any person through foreclosure
proceedings or otherwise, the Mortgagee or other person acquiring title to the
Premises agrees to accept Tenant under the Lease and to perform the Landlord
obligations hereunder, while owner of the Premises provided that no default has
occurred and is continuing; and Tenant agrees to attorney to and recognize such
Mortgagee or any other person acquiring title to the Premises.
18.2 Rights of Mortgagee and Assignee of Rents. Notwithstanding the
foregoing, no Mortgagee, transferee or purchaser acquiring the interest of any
Mortgagee (and no assignee of Rents or other amounts payable by Tenant
hereunder) shall be: (a) liable for the performance of any of Landlord's
obligations relating to the Premises, (b) liable for Landlord's obligations
arising prior to the date that such Mortgagee, assignee of Rents or other party
takes possession of the Premises; (c) liable for Annual Base Rent or any
Additional Payment Obligations paid more than thirty (30) days in advance; (d)
subject to offsets, claims or defenses which Tenant might have against any prior
landlord; or (e) bound by any amendments, waiver, or modification of or
affecting this Lease made without its written consent. If Tenant is given
written notice of the identity and address of any Mortgagee or assignee of
Rents, then Tenant shall give to such Mortgagee written notice of any default by
Landlord under the terms of this Lease by registered or certified mail, and such
Mortgagee shall be given the opportunity to cure Landlord's default within the
thirty (30) days following such written notice; provided, however, that said
thirty (30) day period shall be extended if such party has commenced to cure the
default within such thirty (30) day period and such party is proceeding with due
diligence (including the exercise of its remedies against Landlord if necessary
to obtain possession of the Premises) to effect such cure.
18.3 Direct Payment of Tenant Obligations. In the event Landlord notifies
Tenant in writing to pay the Annual Base Rent directly to such Mortgagee, Tenant
agrees to make all payments of such amounts directly to Mortgagee upon written
notice by the Landlord and in the manner directed by the Landlord in its notice.
SECTION 19
ESTOPPEL CERTIFICATES
19.1 Estoppel Certificates. Landlord and/or Tenant shall, at any time and
from time to time, within a period of fifteen (15) calendar days following
written request from the other party, execute, acknowledge and deliver a written
statement certifying (a) that a true and correct copy of this Lease is attached
to such statement, (b) that this Lease is in full force and effect and
unmodified (or, if modified, stating the nature of such modification and
attaching a copy thereof), (c) the date to which the Annual Base Rent and the
Additional Payment Obligations have been paid, (d) that there are not, in the
case of the estoppel certificate to be provided by Landlord, to Landlord's
knowledge, any uncured defaults on the part of Tenant hereunder, and in the case
of the estoppel certificate to be provided by Tenant, to Tenant's knowledge, any
uncured defaults on the part of Landlord hereunder, or in either case,
specifying such defaults, and (e) as to such other matter as Landlord or Tenant
or any prospective purchaser or Mortgagee of the Premises may reasonably
request. Any such statement may be relied upon by Landlord or Tenant, as the
case may be, and any prospective purchaser or Mortgagee. Landlord's or Tenant's
failure to deliver such statement within the said period shall be conclusive as
to the matters stated therein.
SECTION 20
EVENT OF DEFAULT
20.1 Tenant's Default. The occurrence of any of the following shall, at
Landlord's option, constitute a material default and breach of this Lease by
Tenant (an "Event of Default"):
(a) A failure by Tenant to pay Annual Base Rent or any Additional
Payment Obligations reserved herein within five (5) calendar days after written
notice thereof from Landlord to Tenant; provided, however, Landlord shall only
be obligated to provide such written notice and five (5) days cure period twice
in any calendar year.
(b) The abandonment of the Premises by Tenant or its vacation
thereof for a period in excess of 30 (thirty) days.
(c) The filing of any lien against the Premises or any portion
thereof or interest therein as a result of the act or omission of the Tenant or
its agents, servants or licensees which is not discharged or released or a
sufficient bond is not obtained within thirty (30) days after filing subject to
Tenant's rights in Section 8.2 to contest a lien;
(d) The making by Tenant of any assignment for the benefit of
creditors; the adjudication that Tenant is bankrupt or insolvent; the filing by
or against Tenant of a petition for the suspension of payments or of a petition
to have Tenant adjudged bankrupt or a petition for reorganization or arrangement
under any law relating to bankruptcy (unless in the case of a petition filed
against Tenant, the same is dismissed within thirty (30) days after the filing
thereof); the appointment of a trustee or receiver to take possession of
substantially all of Tenant's assets or of Tenant's interest in this Lease; or
the attachment, execution or levy against, or other judicial seizure of,
substantially all of Tenant's interest in this Lease;
(e) A failure by Tenant to fully observe and perform the provisions
or covenants of Sections 7 or 12 of this Lease; or Tenant takes any actions
under Section 11.3, which entitled Landlord to accelerate the Rents Payable.
(f) A failure by Tenant to fully observe and perform any other
provision or covenant of this Lease to be observed or performed by Tenant, where
such failure continues for thirty (30) calendar days after written notice
thereof from Landlord to Tenant. If any failure described in this Section
20.1(f) is capable of being cured but cannot be cured within thirty (30)
calendar days, then such failure shall not be an Event of Default hereunder so
long as Tenant has promptly commenced cure within such thirty (30) calendar day
period, proceeds with diligence to complete such cure, and completes such cure
within ninety (90) calendar days after written notice thereof from Landlord to
Tenant.
20.2 Landlord's Default. If at any time during the Term Landlord shall
fail to perform any of its obligations under this Lease, Tenant may, if any such
failure shall continue for a period of thirty (30) consecutive calendar days
after Tenant gives written notice thereof to Landlord and Landlord notifies
Tenant that it contests or disputes such claimed default with such thirty (30)
calendar day period, perform such obligations; and any such sum shall be payable
by Landlord within ten (10) calendar days of written demand together with
interest thereon at the rate established in Section 21.1 (b) hereof; provided,
however, if the nature of the claimed default is such that it cannot feasibly be
cured within such 30-calendar-day period, and Landlord notifies Tenant of such
condition, then Landlord shall not be deemed to be in default if such condition
does not materially interfere with Tenant's use of the Premises and Landlord
promptly and diligently commenced cure within such thirty (30) calendar day
period.
SECTION 21
ACCELERATED RENT
21.1 Accelerated Rent.
(a) Upon any Event of Default, the Annual Base Rent and Additional
Payment Obligations reserved herein for the entire unexpired portion of the Term
shall, at Landlord's option, thereupon immediately become due and payable
(without regard to the premature termination of the Term by reason of such Event
of Default). Tenant shall be obligated for such accelerated Rents regardless of
which, if any, of the other remedies provided in this Lease or under law or in
equity the Landlord elects to pursue. Landlord shall forthwith, notwithstanding
any other provisions of this Lease to the contrary, be entitled to recover from
Tenant all outstanding and unpaid Annual Base Rent and Additional Payment
Obligations as of the date of such Event of Default, together with an amount, as
liquidated damages, equal to the difference between the present worth of the
aggregate of the Annual Base Rent and Additional Payment Obligations which would
have been payable hereunder for the original unexpired portion of the Term of
this Lease (without regard to the premature termination of the Term by reason of
such Event of Default) and the then present worth of the then aggregate fair
market rent of the Premises for the same period. In the computation of such
present value, a discount at a current commercially reasonable market
capitalization rate shall be employed. Upon any termination of this Lease by
Landlord as a result of an Event of Default by Tenant, Landlord agrees to take
commercially reasonable steps to re-lease the Premises to mitigate its damages
as provided in Section 22.2 below.
(b) Nothing herein contained shall limit or prejudice the right of
Landlord in lieu of the foregoing accelerated Annual Base Rent and Additional
Payment Obligations remedy to prove and obtain by reason of such termination an
amount of damages, and interest thereon at the rate which is the lesser of
eighteen percent (18 %) per annum or the maximum legal rate then in effect,
whether or not such amount be greater, equal to, or less than the accelerated
amount referred to above.
(c) It is understood by the parties that the preceding paragraphs
will not be applicable in the event of an early termination if the Tenant has
another tenant in place for the Premises with the same or greater financial
solvency, in which case the Landlord will not charge any penalties to the Tenant
for such early termination.
SECTION 22
REMEDIES
22.1 Landlord's Rights and Remedies. Upon any Event of Default, Landlord
at its option, may terminate this Lease by giving written notice of termination
to Tenant, or Landlord, without terminating this Lease, may at any time after an
Event of Default, without notice or demand additional to that which may be
required by Section 20 hereof, and without limiting Landlord in the exercise of
any other right or remedy which Landlord may have by reason of such Event of
Default or breach, exercise any one or more of the remedies hereinafter provided
in this Section or in this Lease or as otherwise provided at law or in equity,
all of such remedies (whether provided herein or by-law) being cumulative and
not exclusive.
22.2 Liability for Reletting Costs. In the event of termination of the
Lease and recovery of the Premises by Landlord, Landlord shall make good faith
and commercially reasonable efforts to relet the Premises. Tenant agrees that
all reasonable costs and expenses paid or incurred by Landlord in reletting of
the Premises, including, without limitation, all costs associated with
advertising, repair, and redecorating the Premises, all leasing commissions,
Tenant allowances, partial or total rental abatement periods, attorneys' and
accountants' fees (the "Reletting Costs") which shall be due and payable by
Tenant to Landlord within twenty (20) days following written demand therefore
and shall constitute Additional Payment Obligations. Any proceeds of such
reletting received by Landlord after deducting all costs and expenses incurred
by Landlord as a result of Tenant's default or in connection with such reletting
(collectively, the "Net Reletting Proceeds"), shall be applied against amounts
due or owing by Tenant according to the Lease. If Tenant has previously paid to
Landlord the accelerated Annual Base Rent and Additional Payment Obligations
provided under Section 21, then the Net Reletting Proceeds shall be refunded to
Tenant as they are paid to Landlord, up to the full amount of the accelerated
Annual Base Rent and Additional Payment Obligations paid by Tenant. At such
reasonable times as Tenant may request, Landlord shall make available to Tenant
and its representatives books and records relative to such reletting.
22.3 Right to Perform for Tenant. During the continuance of any Event of
Default, if Tenant shall fail to perform or comply with any of its agreements
contained herein, the Landlord shall have the right, but not the obligation, to
perform or comply with such agreement after at least ten (10) days' prior notice
to Tenant (and in connection therewith may enter upon the Premises); in any such
event the Landlord shall not thereby be deemed to have waived any default caused
by such failure, and the amount of the expense of Landlord (including reasonable
attorney's fees and expenses) incurred in connection with such payment or the
performance of or compliance with such agreement, as the case may be, together
with interest thereon as provided in Section 22.4, shall be deemed an Additional
Payment Obligation, payable by Tenant to Landlord upon demand.
22.4 Interest. Any amount not paid by Tenant to Landlord when due (subject
to any applicable grace periods) shall bear interest from the date due at the
lesser of (a) eighteen percent (18%) per annum, or (b) the maximum rate then
permitted by applicable law, and shall be paid by Tenant to Landlord on written
demand therefore, and shall constitute an Additional Payment Obligation.
SECTION 23
WAIVER
23.1 Waiver. The failure or delay on the part of Landlord or Tenant to
enforce or exercise at any time any of the provisions, rights or remedies in
this Lease shall in no way be construed to be a waiver thereof, nor in any way
to affect the validity of this Lease or any part hereof, or the right of
Landlord or Tenant, as the case may be, to thereafter enforce each and every
such provision, right or remedy. No waiver of any breach of this Lease shall be
held to be a waiver of any other or subsequent breach. The receipt by Landlord
of Annual Base Rent or an Additional Payment Obligation at a time when the
Tenant is in default under this Lease shall not be construed as a waiver of such
default. The receipt by Landlord of a lesser amount than the Annual Base Rent or
Additional Payment Obligations due shall not be construed to be other than a
payment on account of the Annual Base Rent or Additional Payment Obligations
then due, nor shall any statement on Tenant's check or any letter accompanying
Tenant's check be deemed an accord and satisfaction, and Landlord may accept
such payment without prejudice to Landlord's right to recover the balance of the
Annual Base Rent or Additional Payment Obligations due or to pursue any other
remedies provided in this Lease. No act or thing done by Landlord or Landlord's
servants, agents or successors during the Term shall be deemed an acceptance of
a surrender of the Premises, and no agreement to accept such a surrender shall
be valid, unless in writing and signed by Landlord.
SECTION 24
QUIET ENJOYMENT
24.1 Quiet Enjoyment. Landlord warrants that it owns title to the
Premises, subject to the Permitted Encumbrances. So long as Tenant is in
compliance with the terms of the Lease, Tenant shall have the right to peaceably
and quietly have, hold and enjoy use of the Premises for the initial or any
extended Term of the Lease, free from interference by Landlord, its employees,
representatives, agents, or from any other person claiming under or through
Landlord, subject nevertheless to all of the provisions of this Lease. Landlord
warrants that it has the right to enter into the Lease.
SECTION 25
GOVERNING LAW
25.1 Governing Law. With respect to all matters arising under this Lease,
this Lease shall be construed, governed and enforced in accordance with the
Civil Code of the State of Tamaulipas, United Mexican States, with exclusive
jurisdiction residing in the courts and tribunals located in the City of X.
Xxxxxxxxx, State of Tamaulipas, United Mexican States, to adjudicate all claims
arising hereunder. The provisions of this Section 25.1 are not applicable to the
Guaranty or any guarantee(s) given by a third party or by third parties to
Landlord to assure the performance by the Tenant of any of its Lease.
25.2 Translation. English was the language in which this Lease was
negotiated. Promptly following execution of this Lease, the parties shall cause
this Lease to be translated from English into Spanish and following completion
thereof, both parties agree to execute the translated version of this Lease
promptly following receipt of such translated version. The translator shall be a
person reasonably acceptable to both parties, and the parties shall share
equally the translator's charges. In the event of litigation in a Mexican
tribunal, the Spanish version may be used as evidence of the agreement of the
parties. If, however, there is a dispute between the parties with respect to the
translation, reference may be made to the Spanish version, which shall prevail
in the event of any discrepancy.
SECTION 26
OPTION TO EXTEND
26.1 Option to Extend. Tenant shall have the right to extend the term of
this Lease (the "Extension Option") as follows:
One consecutive period of five (5) years ("First Extension Term") at the
Annual Base Rent set forth below. All of the other terms, covenants and
conditions contained in this Lease, including payment of Additional Payment
Obligations, shall apply to the Extension Term.
One consecutive period of three (3) years ("Second Extension Term") at the
Annual Base Rent set forth below. All of the other terms, covenants and
conditions contained in this Lease, including payment of Additional Payment
Obligations, shall apply to the Second Extension Term.
26.2 Rent for First Extension Term. The applicable rent for the first
extension term will be determined according to the rent paid in the last year of
the Initial Term, increased in a rate equal to the percentage change of the
Consumer Price Index (CPI) in the previous twelve months, provided, however,
that the rent payable during the first extension term may not be lower than the
rent payable during last year of the Initial Term.
26.3 Rent for the Second Extension Term. The parties shall negotiate the
Annual Base Rent payable in respect of the Second Extension Term.
26.4 Exercise of Option. Tenant must exercise each Extension Option by
delivery of written notice (the "Exercise Notice") to Landlord ninety (90)
calendar days prior to the expiration of the Term or the First Extension Term,
as applicable, expressly stating its election to extend the Term pursuant to
this Article 26 and its agreement to be bound by all of the terms and conditions
of this Lease. Tenant's right to extend the Term pursuant to this Article 26
shall also be subject to the condition that no Event of Default shall have
occurred and be continuing at the time Tenant delivers its Exercise Notice and
at the commencement of the Extension Term.
SECTION 27
MISCELLANEOUS
27.1 Signs. Tenant shall not place, install or affix, or permit the
placement, installation or fixation of any sign of any nature whatsoever which
can be seen from outside the Building except in accordance with any restrictive
covenants and all applicable, present and future, laws, statutes, codes,
ordinances, orders, decrees, regulations and requirements. Any permitted signs
installed on or about the Premises shall be removed at the expiration or sooner
termination of the Term of this Lease and the Premises promptly repaired or
restored to its original conditions where such sign has been removed. Tenant
shall pay all expenses, and all license and permit fees relating to the
installation and maintenance of authorized signs, and shall pay all expenses of
removal and costs of repairs resulting therefrom.
27.2 Unavoidable Delay. If either party shall be delayed or hindered in,
or prevented from, the performance of any covenant or obligation hereunder,
other than one for the payment of money, as a result of any acts of God, fire or
other casualty, enemy act, war, riot, general unavailability of certain
materials, strikes, boycotts, or labor disputes or other similar events beyond
the reasonable control of either party hereto that cause such party to be
delayed or hindered in, or prevented from, the performance of any covenant or
obligation hereunder, and provided that the-party delayed, hindered or prevented
from performing notifies the other party not later than ten (10) calendar days
after the date on which performance of such covenant or obligation is due of any
such delay, hindrance or prevention, then the performance of such covenant or
obligation shall be extended by the number of days equivalent to the number of
days of the impact of such delay, hindrance, or prevention. In no event shall
any such delay, hindrance or prevention constitute a termination of this Lease
and the provisions of this Section shall not operate to excuse Tenant from the
prompt payment of any Annual Base Rent or Additional Rent due and owing under
this Lease.
27.3 Corporate Authority. Landlord and Tenant each represent and warrant
to the other that each individual executing this Lease on behalf of said
corporation is duly authorized to execute and deliver this Lease on behalf of
said corporation in accordance with a duly adopted resolution of the board of
directors of said corporation and in accordance with the bylaws of said
corporation and that this Lease is binding upon said corporation in accordance
with its terms.
27.4 Successors. The respective rights and obligations provided in this
Lease shall bind and shall inure to the benefit of the parties hereto, their
legal representatives, heirs, successors and permitted assigns; provided,
however, that no rights shall inure to the benefit of any successor or assign of
Tenant unless Landlord's written consent for the transfer to such successor has
first been obtained to the extent required by this Lease.
27.5 Severability. If any provision of this Lease shall be held to be
invalid, void or unenforceable, the remaining provisions hereof shall in no way
be affected or impaired and such remaining provisions shall remain in full force
and effect.
27.6 Captions. Marginal captions, titles and exhibits to this Lease are
for convenience and reference only and are in no way to be construed as
defining, limiting, or modifying the scope or intent of the various provisions
of this Lease.
27.7 Persons; Gender. As used in this Lease, the word "person" shall mean
and include, where appropriate, an individual, corporation, partnership or other
entity; the plural shall be submitted for the singular, and the singular for the
plural, where appropriate; and words of any gender shall mean to include any
other gender.
27.8 Notices. Any xxxx, statement, notice or communications required or
permitted hereunder shall be in writing addressed to the respective party as set
forth below and may be personally served, telecopied or sent by internationally
recognized overnight courier service or U.S. Mail and shall be deemed given: (a)
if served in person, when served; (b) if telecopied, on the date of transmission
if before 5:00 p.m. (Mountain time) on a business day; provided that a "hard"
copy of such notice is also sent pursuant to (c) or (d) below; (c) if by
international overnight courier, on the first business day after delivery to the
courier; or (d) if by U.S. Mail, certified or registered mail, return receipt
requested on the 4th day after deposit in the mail postage prepaid.
To Landlord: Xxxxx 0 X Xxxxxxxxxx Xx.0
X. Xxxxxxxxx, Xxxxxxxxxx, Xxxxxx
Attn. X.X. Xxxxxxxx Xxxxxx Xxxxxxxxx Xxxxxxxxx
To Tenant: Calle Colorado s/n entre Av. Xxxxx Xxxxxx y Ave.
Cantinflas
Parque Industrial CYLSA
X. Xxxxxxxxx, Tamaulipas,
Mexico
Attn. Xx. Xxxxxxx Xxx Xxxxxxx Xxxxxxx
Either party may change its address for purposes of this Section 27.8 by
written notice so given to the other party consistent with the requirements of
this Section.
27.9 Lease not an Offer. The submission of this Lease to Tenant should not
be construed as an offer, nor shall Tenant have any rights with respect thereto
unless and until Landlord shall execute this Lease and deliver the same to
Tenant, which rights may be revoked by Landlord at any time prior to receipt by
Tenant of this Lease duly executed by Landlord.
27.10 Counterparts. This Lease may be executed in several counterparts and
by each party on a separate counterpart, each of which, when so executed and
delivered, shall be an original and all of which together shall constitute one
instrument. In proving this Lease, it shall not be necessary to produce or
account for more than one such counterpart signed by the party, against whom
enforcement is sought.
27.11 Time of the Essence. TIME IS OF THE ESSENCE WITH RESPECT TO THE DUE
PERFORMANCE OF THE TERMS, COVENANTS AND CONDITIONS HEREIN CONTAINED; PROVIDED,
HOWEVER, NO DELAY OR FAILURE TO ENFORCE ANY OF THE PROVISIONS HEREIN CONTAINED
AND NO CONDUCT OR STATEMENT SHALL WANE OR AFFECT ANY OF LANDLORD'S RIGHTS UNDER
THIS LEASE.
27.12 Landlord's Obligations. Landlord's obligations hereunder shall be
binding upon Landlord only for the period of time that Landlord is the owner of
the Premises; and, upon termination of that ownership, Tenant shall look solely
to Landlord's successor in interest in the Premises for the satisfaction of each
and every obligation of Landlord hereunder.
27.13 Landlord's Exculpatory. Anything contained in this Lease to the
contrary notwithstanding, Tenant agrees that in any judicial proceeding
involving the collection of any judgment (or other judicial process) requiring
the payment of money by Landlord or any partner, officer, shareholder or
employee of Landlord, Tenant shall look solely to the estate and property of
Landlord in the Premises and to no other property or assets of Landlord, nor to
any property of any partner, officer, shareholder or employee of Landlord, nor
shall any property of either the Landlord (with the exception of the Premises)
or any partner, officer, shareholder, or employee of Landlord become subject to
levy, execution, attachment or other enforcement procedures for the satisfaction
of Tenant's remedies. In addition, Tenant covenants and agrees that no personal
liability or responsibility is assumed by, nor shall at any time be asserted or
enforceable against, any partner, officer, shareholder, or employee of Landlord
on account of any covenant, undertaking or obligation under or with respect to
this Lease, all such personal liability and responsibility, if any, being
expressly waived and released. The exculpation does not apply to claims caused
by a party's willful misconduct.
27.14 Indirect Damages. Notwithstanding any provisions of this Lease to
the contrary, none of the provisions of this Lease shall cause either party to
be liable to the other party, or anyone claiming through or on behalf of such
other party, for any special, indirect or consequential damages, including,
without limitation, lost profits or revenues.
27.15 Compliance. Tenant shall, at its sole cost and expense, comply with
all laws, orders, ordinances and regulations of all governmental authorities
having jurisdiction with respect to occupancy, use or manner of use of the
Premises. Landlord shall, at its sole cost and expense, comply with all laws,
orders, ordinances and regulations of all governmental authorities having
jurisdiction with respect to those portions of the Premises that are maintained
by Landlord pursuant to Section 10.1 hereof. Landlord and Tenant shall give each
other prompt notice of any violation or recommendation of change of which it
shall have received notice from any such authority. Neither Landlord nor Tenant
shall do or permit to be done any act or thing, which will invalidate or be in
conflict with the Certificate of Occupancy for the Building.
27.16 Modifications. This Lease, including all exhibits attached hereto,
contains all of the agreements, conditions, understandings, representations and
warranties made between the parties hereto with respect to the subject matter
hereof and may not be modified orally or in any manner other than by an
agreement in writing signed by both parties hereto or their respective
successors in interest.
27.17 Brokerage. Landlord and Tenant warrant and represent to each other
that they have had no dealings with any broker, agent or finder in connection
with this Lease except _____N/A___________ (the "Brokerage Agents"). Landlord
shall pay the commissions of the Brokerage Agents. Both parties agree to
protect, indemnify and hold harmless the other from and against any and all
expenses with respect to any compensation, commissions and charges claimed by
any other broker, agent or finder not identified above with respect to this
Lease or the negotiation thereof that is made by reason of any action or
agreement by such party.
27.18 Denomination of Currency. All monetary sums expressed herein as
"dollars" or by use of the dollar sign ("$") shall mean sums in the lawful
currency of the United States of America. All sums due from one party to the
other hereunder shall be payable in such United States dollars.
IN WITNESS WHEREOF, the parties hereto have duly executed this Lease in
the City of X. Xxxxxxxxx, State of Tamaulipas, United Mexican States on the
_1ST____, of __NOVEMBER_________________ 2004.
TENANT:
/s/ Xxxxxxx Xxxxxxx
------------------------------------------------
SIMCLAR DE MEXICO, S.A. DE C.V.
XX. XXXXXXX XXX XXXXXXX XXXXXXX
PRESIDENT AND LEGAL REPRESENTATIVE
LANDLORD
/s/ Xxxxxxxx Xxxxxx Xxxxxxxxx Xxxxxxxxx
------------------------------------------------
CONSORCIO INMOBILIARIO DEL NORESTE, S.A. DE C.V.
C.P. XXXXXXXX XXXXXX XXXXXXXXX XXXXXXXXX
----------------------------------------
LEGAL REPRESENTATIVE
WITNESS:
/s/ Oscar Passament Xxxxxx
------------------------------------------------
Mr. Oscar Passament Xxxxxx
/s/ Xx. Xxxxxxx Xxxxxxx
------------------------------------------------
Xx. Xxxxxxx Xxxxxxx
Exhibit "C"
Form of Guaranty Agreement
THIS LEASE GUARANTY AND AGREEMENT (the "Guaranty") is made as of the _ day
of __11-1___________, 2004, by and from _SIMCLAR INC.________________________, a
_____U.S.___________ corporation, having its principal place of business at (the
"Guarantor"), to and for ___2230 W. 77TH
ST.HIALEAH,FLORIDA,33016_______________________________________________________,
having an office at X. Xxxxxxxxx, Tamaulipas, and United Mexican States (The "
Landlord").
WITNESSETH:
WHEREAS, Landlord has entered into a Lease with _SIMCLAR
INC.___________________, a Mexican "sociedad anonima de capital variable"
corporation (the "Tenant") dated __11-1-04___________________, 2004 (the
"Lease") with respect to a manufacturing facility on property located at
__AVE.CANTINFLAS ENTRE XXXXX XXXXXX Y
COLORADO_______________________________________in X. Xxxxxxxxx, Tamaulipas,
United Mexican States. (The "Leased Premises");
WHEREAS, Guarantor owns _100_____% of the issued and outstanding
shares of the Tenant and fully controls it.
WHEREAS, Landlord was willing to enter into the Lease with the Tenant only
if Guarantor agreed to guaranty payment of the Guaranteed Obligations (defined
below) to Landlord in the manner hereinafter provided, and performance of all of
the Tenant's obligations under the Lease;
NOW, THEREFORE, in consideration of the foregoing recitals, which are
incorporated into the operative provisions of this Guaranty by this reference,
and for good and valuable other consideration, the receipt and adequacy of which
are hereby conclusively acknowledged, and intending to be legally bound hereby,
Guarantor hereby agrees as follows:
1. Guaranty of Payment and Performance. Guarantor hereby absolutely,
unconditionally and irrevocably guarantees, as primary obligor and not merely as
a surety, to Landlord and its successors and/or assigns:
(a) The prompt and complete payment in full when due, of all
payments of "Rent", "Additional Payment Obligations" (as such terms are
defined in the Lease) and all other liabilities, charges and amounts that
become due and payable under the Lease (including any extension or
hold-over period) (the "Lease Payments");
(b) The full, prompt, and absolute performance and observance by
Tenant of all of the obligations contained in the Lease to be performed or
observed by, or imposed upon, Tenant during the Term (including any
extension or renewal thereof) or any hold-over period; and
(c) The prompt and complete payment upon demand of all costs and
expenses of any collection or other realization under, this Guaranty,
including all expenses, liabilities and advances made or incurred by
Landlord in connection therewith, including reasonable attorneys' fees.
The payment and performance obligations guaranteed pursuant to this
Section 1 are hereinafter referred to as the "Guaranteed Obligations".
2. Representations and Warranties. Guarantor represents and warrants that:
(a) No consents or approvals of any kind by others, including any
creditors of Guarantor, and no license, permit, approval or authorization
of, exemption by, notice or report to, or registration, filing or
declaration with, any governmental authority is required by Guarantor, in
connection with this Guaranty or the execution, delivery, performance,
validity or enforceability of this Guaranty and all obligations required
hereunder, and this Guaranty is not in violation of the terms of any
agreement or instrument to which Guarantor or Tenant is a party or by
which either of them or any of their assets may be bound or affected, and
this Guaranty will not violate any provision of any existing law or
regulation of material import, which would result in a material adverse
effect on Guarantor, which is binding on Guarantor, or any order,
judgment, award or decree of any court, arbitrator or governmental
authority binding on Guarantor;
(b) There is no pending or, to the best of Guarantor's knowledge,
threatened action or proceeding affecting Guarantor before any court,
governmental agency or arbitrator that could reasonably be expected to
have a material adverse effect on the ability of Guarantor to perform or
observe any of its obligations hereunder or that could reasonably be
expected to have a material adverse effect on Guarantor's guaranty of the
Guaranteed Obligations hereunder;
(c) Guarantor has full power, authority and legal right to execute
this Guaranty and to observe and perform all of the terms of this Guaranty
on Guarantor's part to be observed and performed and this Guaranty
constitutes the valid and binding obligation of Guarantor, enforceable in
accordance with its terms, except as such enforcement may be limited by
bankruptcy laws and other laws affecting the rights of creditors
generally, or by virtue of the application of general principles of
equity;
(d) This Guaranty is made by Guarantor at the request of Tenant and
Landlord's agreement to enter into the Lease with Tenant is of substantial
and material benefit to Guarantor,
(e) Guarantor has established adequate means of obtaining from
Tenant on continuing basis financial and other information pertaining to
the respective financial condition of Tenant and the ability of Tenant to
promptly pay the Guaranteed Obligations,
(f) Guarantor has reviewed and approved copies of the Lease and is
fully informed of the rights and remedies that Landlord may pursue, with
or without notice to Tenant, upon the occurrence and continuance of a
default or Event of Default thereunder; and
Any financial statements of Guarantor heretofore delivered to Landlord (i)
are true and correct in all respects as of the date thereof, (ii) were prepared
in accordance with generally accepted accounting principles, consistently
applied, and (iii) fairly present the financial position of Guarantor as of the
date thereof.
3. Adequate Information. Guarantor shall, at its sole cost and expense,
establish and maintain means whereby Guarantor shall be kept adequately informed
of any facts, events or circumstances that might in any way affect Guarantor's
risks hereunder, and Landlord shall have no obligation to disclose to Guarantor
information or material acquired in the course of Landlord's relationship with
Tenant.
4. Payment by Guarantor: Application of Payments. Guarantor hereby agrees,
in furtherance of the foregoing and not in limitation of any other right that
Landlord may have at law or in equity against Guarantor by virtue hereof, that
upon the failure of Tenant to pay any of the Guaranteed Obligations when and as
the same shall become due, Guarantor will upon demand pay, or cause to be paid,
in cash, to Landlord, an amount equal to the sum of the unpaid principal amount
of all Guaranteed Obligations then due as aforesaid, all accrued and unpaid
interest thereon, and all other Guaranteed Obligations then owed to Landlord as
aforesaid. All such payments shall be applied promptly from time to time by
Landlord:
First, to the payment of the costs and expenses of any collection or other
realization under, this Guaranty, including all expenses, liabilities and
advances made or incurred by Landlord in connection therewith, including
reasonable attorneys' fees,
Second, to the payment of all other Guaranteed Obligations; and
Third, after payment in full of all Guaranteed Obligations, to the payment
to whomsoever may be lawfully entitled to receive the same or as a court of
competent jurisdiction may direct, of any surplus then remaining from such
payments.
5. Release of Guaranty. When Tenant pays the full amount of the Lease
Payments and performs all of the obligations contained in the Lease, this
Guaranty shall terminate and become void and have no further force or effect.
6. Liability of Guarantor Absolute. Guarantor agrees that its obligations
hereunder are irrevocable, absolute, independent and unconditional and shall not
be affected by any circumstance that constitutes a legal or equitable discharge
of a guarantor or surety other than indefeasible payment in full of the
Guaranteed Obligations. In furtherance of the foregoing and without limiting the
generality thereof, Guarantor agrees as follows:
(a) This Guaranty is a guaranty of payment and performance and not
of collectibility.
(b) Landlord may enforce this Guaranty upon the terms and conditions
herein set forth notwithstanding the existence of any dispute between
Landlord and Tenant, any partners, joint venturers, officers, directors,
shareholders, trustees or beneficiaries (as applicable) of Tenant or any
other Person with respect to the existence of any default or "Event of
Default" (as defined in the Lease) under the Lease.
(c) Landlord may enforce this Guaranty upon the terms and conditions
herein set forth notwithstanding any exercise or failure to exercise any
right or remedy available to Landlord against any Person under the Lease,
at law, in equity or otherwise.
(d) The obligations of Guarantor hereunder are independent of the
obligations of Tenant, any partners, joint venturers, officers, directors,
shareholders, trustees or beneficiaries (as applicable) of Tenant or any
other Person under the Lease, including the obligations of any other
guarantor, and a separate action or actions may be brought and prosecuted
against Guarantor whether or not any action is brought against Tenant or
any of such other Persons and whether or not Tenant is joined in any such
action or actions.
(e) Payment by Guarantor of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or abridge
Guarantor's liability for any portion of the Guaranteed Obligations that
has not been paid.
(f) Landlord, upon such terms as it deems appropriate, without
notice or demand and without affecting the validity or enforceability of
this Guaranty or giving rise to any reduction, limitation, impairment,
discharge or termination of Guarantor's liability hereunder, from time to
time may: (i) grant an extension or extensions of time for the payment or
performance of any Guaranteed Obligations or change the time, place or
manner or terms of payment of the Guaranteed Obligations; (ii) grant an
indulgence or indulgences in the payment or performance of any Guaranteed
Obligations; (iii) modify or amend the Lease or any term thereof or any
obligation of Tenant arising thereunder; (iv) consent to any assignment or
assignments, subleases and successive assignments or subleases by Tenant;
(v) consent to an extension or extensions of the term of the Lease; (vi)
settle, compromise, release or discharge, or accept or refuse any offer of
performance with respect to, or substitutions for, the Guaranteed
Obligations or any agreement relating thereto and/or subordinate the
payment of the same to the payment or performance of any other
obligations; (vii) request and accept other guaranties of the Guaranteed
Obligations and take and hold security for the payment of this Guaranty or
the Guaranteed Obligations; (viii) release, surrender, exchange,
substitute, compromise, settle, rescind, waive, alter, subordinate or
modify, with or without consideration, any security for payment of the
Guaranteed Obligations, any other guaranties of the Guaranteed
Obligations, or any other obligation of any Person (including any other
guarantor) with respect to the Guaranteed Obligations; (ix) enforce and
apply any security now or hereafter held by or for the benefit of Landlord
in respect of this Guaranty or the Guaranteed Obligations and direct the
order or manner of sale thereof, or exercise any other right or remedy
that Landlord may have against any such security, as Landlord in its
discretion may determine; and (x) exercise any other rights available to
it under the Lease, at law or in equity.
(g) This Guaranty and the obligations of Guarantor hereunder shall
be valid and enforceable and shall not be subject to any reduction,
limitation, impairment, discharge or termination for any reason (other
than indefeasible payment in full of the Guaranteed Obligations),
including the occurrence of any of the following, whether or not Guarantor
shall have had notice or knowledge of any of them: (i) any failure or
omission to assert or enforce, or agreement or election not to assert or
enforce, or the stay or enjoining, by order of court, by operation of law
or otherwise, of the exercise or enforcement of, any claim or demand or
any right, power or remedy (whether arising under the Lease, at law, in
equity or otherwise) with respect to the Guaranteed Obligations or any
agreement relating thereto, or with respect to any other guaranty of, or
security for, the payment of the Guaranteed Obligations; (ii) any
rescission, waiver, amendment or modification of, or any consent to
departure from, any of the terms or provisions (including provisions
relating to Events of Default) of the Lease, or of any other guaranty or
security for the Guaranteed Obligations; (iii) the Guaranteed Obligations,
or any agreement relating thereto, at any time being found to be illegal,
invalid or unenforceable in any respect; (iv) the release or discharge of
Tenant in any bankruptcy, insolvency, receivership, reorganization,
liquidation or similar proceedings; (v) the impairment, limitation or
modification of the liability of the Tenant or the estate of the Tenant in
any bankruptcy, insolvency, receivership, reorganization, liquidation or
similar proceeding, or of any remedy for the enforcement of Tenant's said
liability under the lease, resulting from the operation of any present or
future provision of the Bankruptcy Code (Title 11 of the United States
Code, as amended) or other statute or from the decision in any court; (vi)
the rejection or disaffirmance of the lease in any such proceedings; (vii)
the assignment or transfer of the lease by Tenant; (viii) any disability
or other defense of Tenant; (ix) any defenses, set-offs or counterclaims
that Tenant may allege or assert against Landlord in respect of the
Guaranteed Obligations; and (x) any other act or thing or omission, or
delay to do any other act or thing, that may or might in any manner or to
any extent vary the risk of Guarantor as an obligor in respect of the
Guaranteed Obligations.
7. Waivers by Guarantor. Guarantor hereby waives, to the extent not
prohibited by applicable law, for the benefit of Landlord:
(a) Any right to require Landlord, as a condition of payment by
Guarantor, (i) to proceed against Tenant, any other guarantor (including
any other Guarantor) of the Guaranteed Obligations or any other Person,
(ii) to proceed against of exhaust any security held from Tenant, any
other guarantor (including any other Guarantor) of the Guaranteed
Obligations or any other Person, or (iii) to pursue any other remedy in
the power of Landlord whatsoever;
(b) Any defense arising by reason of the incapacity, lack of
authority or any disability or other defense of Tenant, including any
defense based on or arising out of the lack of validity or the
unenforceability of the Guaranteed Obligations or any agreement or
instrument relating thereto or by reason of the cessation of the liability
of Tenant from any cause other than indefeasible payment in full of the
Guaranteed Obligations;
(c) Any principles or provisions of law, statutory or otherwise,
that are or might be in conflict with the terms of this Guaranty and any
legal or equitable discharge of Guarantor's obligations hereunder;
(d) Any rights to set-offs, recoupments and counterclaims;
(e) Promptness, diligence and any requirement that Landlord protect,
secure, perfect or insure any security interest or lien or any property
subject thereto,
(f) Notices, demands, presentments, demands for payment, protests,
notices of protest, notices of dishonor and notices of any action or
inaction, including acceptance of this Guaranty, notices of default under
the Lease, notices of any renewal, extension or modification of the
Guaranteed Obligations or any agreement related thereto, notices of any
extension of credit to Tenant and notices of any of the matters referred
to in Section 6 and any right to consent to any of them; and
(g) Any defenses or benefits that may be derived from or afforded by
law that limit the liability of or exonerate guarantors or sureties, or
that may conflict with the terms of this Guaranty.
8. Guarantor's Rights of Subrogation. Contribution. Etc. Until the
Guaranteed Obligations shall have been indefeasibly paid in full, Guarantor
shall withhold exercise of (a) any claim, right or remedy, direct or indirect,
that Guarantor now has or may hereafter have against Tenant or any of its assets
in connection with this Guaranty or the performance by Guarantor of its
obligations hereunder, in each case whether such claim, right or remedy arises
in equity, under contract, by statute, under common law or otherwise and
including (i) any right of subrogation, reimbursement or indemnification that
Guarantor now has or may hereafter have against Tenant, (ii) any right to
enforce, or to participate in, any claim, right or remedy that Landlord now has
or may hereafter have against Tenant, and (iii) any benefit of, and any right to
participate in, any collateral or security now or hereafter held by Landlord,
and (b) any right of contribution Guarantor may have against any other guarantor
(including any other guarantor) of the Guaranteed Obligations. Guarantor further
agrees that, to the extent the waiver of its rights of subrogation,
reimbursement, indemnification and contribution as set forth herein is found by
a court of competent jurisdiction to be void or voidable for any reason, any
rights of subrogation, reimbursement or indemnification Guarantor may have
against Tenant or against any collateral or security, and any rights of
contribution Guarantor may have against any other guarantor, shall be junior and
subordinate to any rights Landlord may have against Tenant, to all right, title
and interest Landlord may have in any such collateral or security, and to any
right Landlord may have against such other guarantor. Landlord may use, sell or
dispose of any item of collateral or security as it sees fit without regard to
any subrogation rights Guarantor may have, and upon any such disposition or
sale, any rights of subrogation Guarantor may have shall terminate. If any
amount shall be paid to Guarantor on account of any such subrogation,
reimbursement or indemnification rights at any time when all Guaranteed
Obligations shall not have been paid in full, such amount shall be held in trust
for Landlord and shall forthwith be paid over to Landlord to be credited and
applied against the Guaranteed Obligations, whether matured or unmatured, in
accordance with the terms hereof.
9. Subordination of Other Obligations. Any indebtedness of Tenant now or
hereafter held by Guarantor is hereby subordinated in right of payment to the
Guaranteed Obligations, and any such indebtedness of Tenant to Guarantor
collected or received by Guarantor after an Event of Default has occurred and is
continuing shall be held in trust for Landlord and shall forthwith be paid over
to Landlord to be credited and applied against the Guaranteed Obligations but
without affecting, impairing or limiting in any manner the liability of
Guarantor under any other provision of this Guaranty.
10. Continuing Guaranty. This Guaranty is a continuing guaranty and shall
apply to and cover the Lease including any option periods, extension,
amendments, assignments, subleases, transfers or other modifications of the
Lease whether or not Guarantor shall have knowledge or have been notified of or
agreed or consented to any such option period, renewal, extension, amendment,
assignment, sublease, transfer or modification of the Lease. This Guaranty shall
remain in effect until all of the. Guaranteed Obligations shall have been
indefeasibly paid in full.
11. Notice of Events. Immediately upon Guarantor obtaining knowledge
thereof, Guarantor shall give Landlord written notice of any condition or event
that has resulted in (a) a material adverse change in the financial condition of
Guarantor, Tenant or any partner, joint venturer, trustee or beneficiary (as
applicable) of Tenant, or (b) a breach of or noncompliance with any term,
condition or covenant contained herein or in the Lease.
12. Further Assurances. At any time or from time to time, upon the request
of Landlord, Guarantor shall execute and deliver such further documents and do
such other acts and things as Landlord may reasonably request in order to affect
fully the purposes of this Guaranty.
13. Notices. Any notice, request, demand, statement, authorization,
approval, direction or consent made under this Guaranty shall be in writing and
shall be deemed sufficiently given or served for all purposes as of the date (a)
when hand delivered (provided that delivery shall be evidenced by a receipt
executed by or on behalf of the addressee), (b) three (3) days after being sent
by postage pre-paid registered or certified mail, return receipt requested, (c)
when dispatched by telecopy (with written confirmation sent by hand delivery or
registered or certified mail, return receipt requested), or (d) one (1) day
after being sent by Federal Express or other reputable overnight courier service
(with delivery evidenced by written receipt) to any party at its address as
follows:
If to Guarantor:
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Attention:
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Facsimile Transmission Number:
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If to Landlord:
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Any Person shall have the right to specify, from time to time, as its address or
addresses for purposes of this Guaranty, any other address or addresses upon
giving notice thereof to each other Person then entitled to receive notices or
other instruments hereunder at least ten (10) days before such change of address
is to become effective.
14. Non-Waiver by Landlord.
(a) Rights Cumulative. No right or remedy herein conferred upon or
reserved to Landlord is intended to be exclusive of any other right or remedy,
and each and every such right or remedy shall be cumulative and continuing,
shall be in addition to every other right or remedy given hereunder, or under
the Lease or now or hereafter existing at law or in equity, and may be exercised
from time to time and as often as may be deemed expedient by Landlord. Landlord
shall not be limited exclusively to the rights and remedies herein stated but
shall be entitled to every additional right and remedy now or hereafter afforded
by law.
(b) Delay Not a Waiver. No delay or omission by Landlord to exercise
any right or remedy hereunder upon any default or Event of Default or failure of
Landlord to insist on strict -performance of any term of this Guaranty shall
impair such exercise, or be construed to be a waiver of any such default or
Event of Default or an acquiescence therein. No act of Landlord shall be
construed as an election to proceed under any one provision of this Guaranty to
the exclusion of any other provision.
(c) Waivers Specific. The failure, refusal or waiver by Landlord of
its right to assert any right or remedy hereunder upon any default or Event of
Default or other occurrence shall not be construed as waiving such right or
remedy upon any other or subsequent default or Event of Default or other
occurrence.
(d) No Obligation Under Other Agreements. Landlord shall not have
any obligation to pursue any rights or remedies it may have under any other
agreement, including any other guaranty given in respect of the Lease Payments
(or any portion thereof) or any other obligations of Tenant in respect of the
Lease, prior to pursuing its rights or remedies hereunder or under the other
Lease.
(e) Certain Actions Not a Release. Guarantor shall not be relieved
of any of its obligations in respect of the Guaranteed Obligations by reason of,
and the rights of Landlord hereunder shall not be affected by, (i) any
alteration, extension, renewal, change, modification, release, amendment,
compromise or cancellation, in whole or in part, of any term, covenant or
provision of any of the Lease, or (ii) any agreement or stipulation between
Landlord extending the time of payment or otherwise modifying or supplementing
the terms of the Lease, without first having obtained the consent of Guarantor.
15. Certain Definitions. Unless the context clearly indicates a contrary
intent or unless otherwise specifically provided in this Guaranty, (a) the word
"Tenant" shall mean Tenant and any subsequent tenant holding the tenant's
leasehold interest under the Lease, (b) the word "Landlord" shall mean all
Persons constituting Landlord or any subsequent landlord holding the landlord's
interest under the Lease, (c) the word "Person" shall include an individual,
corporation, limited liability company, partnership, joint venture, trust
(including any beneficiary thereof), unincorporated association, government,
governmental authority, or other form of legal or business entity, and (d) the
terms "payment in full" "paid in full" or any similar term means the
indefeasible payment in full of all of the Guaranteed Obligations.
16. Waiver of Notice. Guarantor shall not be entitled to any notices
hereunder of any nature whatsoever from Landlord except with respect to matters
for which this Guaranty specifically and expressly provides for the giving of
notice by Landlord to Guarantor, and Guarantor hereby expressly waives the right
to receive any notice from Landlord with respect to any matter for which this
Guaranty does not specifically and expressly provide for the giving of notice by
Landlord to Guarantor.
17. Relationship. Nothing contained in this Guaranty or the Lease is
intended to create, or shall in any event or under any circumstance be construed
to create, a partnership, joint venture, tenancy-in-common, joint tenancy or
like or similar relationship between Guarantor and Landlord.
18. Matters to be in Writing. Guarantor acknowledges that this Guaranty,
the Lease and all instruments referred to in any of them cannot be extended,
altered, modified, amended, terminated or discharged except in a document
executed by Landlord and that none of the rights or benefits of Landlord can be
waived except in a document executed by Landlord.
19. Descriptive Headings: Construction. The headings in this Guaranty are
intended for convenience of reference only and shall not in any way limit,
amplify or be used in interpreting the terms of this Guaranty. Any of the terms
used herein May, unless the context otherwise requires, be used in the singular
or the plural depending on the reference. All words or terns used in this
Guaranty, regardless of the number or gender in which they are used, shall
include any other number or gender, as the context may require. The words
"herein", "hereof'" and "hereunder" shall refer to this Guaranty unless the
context otherwise requires. The word "including" shall mean "including, without
limitation," except where the context otherwise requires. References to
contracts, agreements, leases and other contractual instruments shall be deemed
to include all subsequent amendments; supplements and other modifications
permitted by the terms of this Guaranty. The term "provisions", when used with
respect hereto or to any other document or instrument, shall be construed as if
preceded by the phrase "terms, covenants, agreements, requirements, conditions
and/or". This Guaranty shall not be construed against any party hereto as the
drafters of this Guaranty. All references to "Sections", "subsections",
"Exhibits" and "Schedules" are to Sections, subsections, Exhibits and Schedules
to this Guaranty unless the context otherwise requires. All Exhibits and
Schedules attached hereto are made a part hereof and are incorporated herein by
this reference.
20. Costs and Expenses. In addition to all other costs and expenses for
which Guarantor may be responsible pursuant to the terms of this Guaranty,
Guarantor shall pay or, on demand, reimburse Landlord for the payment of any
costs or expenses (including attorneys' fees, forum costs and disbursements)
incurred or expended in connection with or incidental to (a) any default by
Guarantor in the performance or observance of any provision contained herein,
(b) any misrepresentation or any breach of warranty made by Guarantor herein, or
(c) the exercise or enforcement by or on behalf of Landlord of (i) any of its
rights or remedies or (ii) Guarantor's obligations under this Guaranty,
including the enforcement, compromise or settlement of the obligations of
Guarantor arising hereunder or the defense or assertion of rights and claims of
Landlord hereunder in respect thereof, by litigation or otherwise.
21. Joint and Several. If more than one person or entity executes this
Guaranty, each such person or entity shall be jointly and severally liable for
observing and performing each of the provisions of this Guaranty.
22. Entire Agreement. This Guaranty constitutes the entire agreement
between Guarantor and Landlord with respect to the subject matter hereof and all
understandings, oral representations and agreements heretofore or simultaneously
had among the parties are merged in, and are contained herein.
23. Successors and Assigns. This Guaranty shall be the obligation of
Guarantor and all of its successors and assigns, and all references in this
Guaranty to Guarantor shall be deemed to include all of the foregoing Persons.
This Guaranty shall inure to the benefit of Landlord and its heirs, successors,
substitutes and assigns, and all references in this Guaranty to Landlord shall
be deemed to include all of the foregoing Persons.
24. Counterparts. This Guaranty may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
taken together shall constitute one and the same instrument. Signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
instrument.
25. No Third Party Beneficiaries. Nothing contained herein is intended or
shall be deemed to create or confer any rights upon any third person not a party
hereto, whether as a third-party beneficiary or otherwise, except as expressly
provided herein.
26. Severability. If any provision of this Guaranty shall be held by any
court of competent jurisdiction to be unlawful, void or unenforceable for any
reason as to any Person or circumstance, such provision or provisions shall be
deemed severable from and shall in no way affect the enforceability and validity
of the remaining provisions of this Guaranty.
27. Governing Law. This Guaranty shall be governed by, and construed in
accordance with, the laws of the State of Texas, without regard to conflict of
laws principles.
28. Submission to Jurisdiction. GUARANTOR, TO THE FULL EXTENT PERMITTED BY
LAW, HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND UPON THE ADVICE
OF COMPETENT COUNSEL, (A) SUBMITS TO PERSONAL JURISDICTION IN THE STATE OF TEXAS
AND THE REPUBLIC OF MEXICO OVER ANY SUIT, ACTION OR PROCEEDING-BY ANY PERSON
ARISING FROM OR RELATING TO THIS GUARANTY, (B) AGREES THAT ANY SUCH ACTION, SUIT
OR PROCEEDING NLAY BE BROUGHT IN: ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION LOCATED IN THE STATE OF TEXAS OR THE REPUBLIC OF MEXICO, (C)
SUBMITS TO THE JURISDICTION OF SUCH COURTS, AND, (D) TO THE FULLEST EXTENT
PERMITTED BY LAW, AGREES THAT IT WILL NOT BRING ANY ACTION, SUIT OR PROCEEDING
IN ANY OTHER FORUM (BUT NOTHING HEREIN SHALL AFFECT THE RIGHT OF LANDLORD TO
BRING ANY ACTION, SUIT OR PROCEEDING IN ANY OTHER FORUM). GUARANTOR FURTHER
CONSENTS AND AGREES TO SERVICE OF ANY SUNLNIONS, COMPLAINT OR OTHER LEGAL
PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING BY REGISTERED OR CERTIFIED U.S.
MAIL, POSTAGE PREPAID, RETURN RECEIPT REQUESTED, TO THE GUARANTOR AT THE ADDRESS
FOR NOTICES DESCRIBED IN SECTION 12 HEREOF, AND CONSENTS AND AGREES THAT SUCH
SERVICE SHALL CONSTITUTE IN EVERY RESPECT VALID AND EFFECTIVE SERVICE (BUT
NOTHING HEREIN SHALL AFFECT THE VALIDITY OR EFFECTIVENESS OF PROCESS SERVED IN
ANY OTHER MANNER PERMITTED BY LAW).
29. Waiver of Jury Trial. GUARANTOR, BY EXECUTION AND DELIVERY OF THIS
GUARANTY, AND LANDLORD, BY ACCEPTANCE HEREOF, TO THE FULL EXTENT PERMITTED BY
LAW, EACH HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND UPON THE
ADVICE OF COMPETENT COUNSEL, EXPRESSLY WAIVES AND RELINQUISHES THE RIGHT TO
TRIAL BY JURY LET ANY ACTION OR PROCEEDING ARISING OUT OF OR IN ANY WAY RELATING
TO THIS GUARANTY OR ANY OTHER AGREEMENT EXECUTED OR DELIVERED IN CONNECTION
HEREWITH.
IN WITNESS WHEREOF, Guarantor has, by its duly authorized representatives,
duly executed this Guaranty as of the day and year first above written.
WITNESSED BY: GUARANTOR:
Simclar, Inc., a
Florida corporation
/s/ Xxxxxx X. Xxxxxxx By: Xxxxx Xxxxxx
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Name: /s/ Xxxxx Xxxxxx
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Title: President
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STATE OF FLORIDA
COUNTY OF MIAMI-DADE
On this the 16th day of November, 2004, before me, the undersigned
officer, personally appeared Xxxxx Xxxxxx, who acknowledged himself to be the
President of Simclar, Inc. Corporation a ________________ and that he, as such
President, being authorized so to do, executed the foregoing instrument for the
purposes therein contained by signing the name of the company by himself as such
officer.
In witness where of, I here unto set my hand.
/s/ Xxxxxx X. Xxxxxxx
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Notary Public
