Contract
Exhibit 10.13
CONTRACT
NUMBER: BMA-B-2/A.2.4.5-03-001
THIS LEASE AGREEMENT, HEREINAFTER REFERRED TO AS “THE
LEASE AGREEMENT” IS SIGNED ON THE ONE HAND BY BAJA DEL MAR,
S.A. DE C.V., HEREINAFTER REFERRED TO AS “BAJA DEL
MAR” AND BANCO UNION, S.A., HEREINAFTER REFERRED TO AS
“BANCO UNION”, BOTH REPRESENTED IN THIS AGREEMENT BY
XXXXXXXXX XXXXX XXXXXXXX AS THE LEGAL REPRESENTATIVE OF BOTH
PARTIES, HEREINAFTER REFERRED TO AS THE “LESSOR”; AND
ON THE OTHER HAND BY BLOCK MEDICAL DE MÉXICO, S.A. DE C.V.,
REPRESENTED IN THIS AGREEMENT BY XX. XXXXX XXXXXXXXX AS THE
LEGAL REPRESENTATIVE, HEREINAFTER REFERRED TO AS THE
“LESSEE” AND I-FLOW CORPORATION AS THE GUARANTOR,
REPRESENTED IN THIS AGREEMENT BY XX. XXXXX DAL PORTO, VICE
PRESIDENT, ACCORDING TO THE FOLLOWING DECLARATIONS AND
CLAUSES:
DECLARATIONS:
| I. | THE LESSOR’S REPRESENTATIVE DECLARES: |
A) That on July 24, 1986, by means of Notarized Public
Instrument number 25,340, Volume 490, notarized by
Xx. Xxxxxxx Xxxxxxx Xxxxxx, Notary Public No 6 for the city
of Tijuana, Baja California, the Mexican Business Corporation
known as “Baja del Mar, S.A. de C.V.” was established
and that said company was properly inscribed in the Public
Property and Commerce Registry of Tijuana, Baja California,
Mexico, under section number 18,255, volume 35, Auxiliary Book
Two, Commerce Section.
B) That on August 30, 1988, by means of Notarized
Public Instrument number 52,878, Volume 908, notarized by
Xx. Xxxxxx Xxxxxx H., Notary Public 3 for the
city of Tijuana, Baja California, the institution known as Banco
Unión, S.A. was appointed trustee of the irrevocable trust
established in favor of the above-mentioned company for the
property located southeast of Parcel Ninety-Six, bordering on
the South Irrigation Canal of the Xxxxxxxxx Dam of this
Municipality with an area of 71,264 square meters; and that
said Public Instrument was registered in the Public Property and
Commerce Registry of Tijuana, Baja California, Mexico, under
section number 73,002, volume CDLVI, Civil Section.
C) That on October 26, 1989, by means of Notarized
Public Instrument number 22,510, Volume 390, notarized by Notary
Public number 14 of Mexico City, BANCO BCH, S.N.C. (now Banco
Unión, S.A.), as the Trustee of Baja del Mar, S.A. de C.V.,
granted power to attorney to Xx. Xxxxxxxxx Xxxxx
Xxxxxxxx, including the power to sign this Lease Agreement.
In addition, Xx. Xxxxxxxxx Xxxxx Xxxxxxxx declares
under oath that these powers have not been limited or revoked.
D) That within the Property mentioned in Declaration I-B,
the LESSOR owns and built the Industrial Building identified as
B-2 Suite A, Incubator spaces #2, 4 and 5 with a total
area of 9,963 square feet (3,321 square feet each)
whose location, distribution, measurements and characteristics
are specified in Attachments “A” and “B”
respectively (These attachments are duly signed by the parties
to this agreement). This industrial building includes the
following improvements that are the property of the LESSOR and
are included in the building’s rent:
| • | Capacity for 300 AMPS/220V, 4H three-phase electric energy with growth potential. |
| • | General lighting. |
| • | No charge for the consumption of non-productive water. |
| • | Shared bathrooms. |
| • | Availability for 2 loading platforms. |
E) That the LEASED PROPERTY has water, sewage and water
tank services with electricity and an available telephone line
service.
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F) That the LEASED PROPERTY is available for the
LESSEE’s intended use, both in terms of its characteristics
as well as its location, according to the Internal Regulations
of the “LA MESA PARQUE INDUSTRIAL” (LA MESA INDUSTRIAL
PARK) specified in Attachment “C”, which was duly
signed by the parties and is therefore an integral part of this
Lease Agreement.
G) The LESSOR has obtained all the legal permits required
by Mexican Law.
| II. | THE LESSEE’S REPRESENTATIVE DECLARES: |
A) That the LESSEE is a company legally established
according to the laws of the Mexican Republic with the legal
capacity to sign and be bound by this Lease Agreement, as
established in Notarized Public Instrument number 42,289, Volume
839, signed and notarized before Xxxxxxx Xxxxxxx Xxxxxx, Notary
Public No 7 for the city of Tijuana, Baja California, duly
inscribed in the Public Property and Commerce Registry.
CLAUSES:
ONE. OBJECTIVE
Under the terms and conditions of this agreement, the LESSOR
leases Incubator Spaces #0, 0 xxx 0, Xxxxx X xx
Xxxxxxxx X-0 of the “LA MESA PARQUE INDUSTRIAL” (LA
MESA INDUSTRIAL PARK), indicated in Declaration I-D of this
Lease Agreement, to the LESSEE.
The LESSOR states that during the term of this Lease, it has all
of the rights to the LEASED PROPERTY and guarantees the LESSEE
the peaceful use and enjoyment of this property.
TWO. TERM
The initial term of this Agreement will be 3 (three) years,
starting on August 15, 2003 with a termination clause that
can be activated with six month’s advance written notice.
Regardless of the commencement date of this Lease, the LESSEE
will have the right to access the LEASED PROPERTY in order to
install accessories and equipment, at any time after this
Agreement is signed.
The LESSER has an option to extend the term of this Lease for 2
(two) additional periods of 3 (three) years each by means of
written advance notice from the LESSEE to the LESSOR at least
one hundred and twenty (120) days prior to the expiration
of the initial term or any of its extensions.
THREE. RENT
As monthly rent for the Lease, both parties establish a price in
National Currency sufficient to acquire the amount of $3,885.57
dollars (three thousand, eight hundred eighty-five dollars and
57/100, currency of the United States of America), paid in
monthly installments in advance on the fifteenth day of each
calendar month to the LESSOR’s registered office located at
Calle E #4. Fracc. Xxxxx, La Mesa, in this city.
The LESSOR hereby receives the amount in National Currency
sufficient to acquire the amount of $3,885.57 dollars (three
thousand, eight hundred eighty-five dollars and 57/100, currency
of the United States of America) for the payment of the first
month’s rent and hereby issues the most ample receipt
allowed by law.
The Base Rent will be increased on the first anniversary of the
Rent Commencement Date and at each subsequent anniversary, by an
increase percentage equal to the increase percentage of the
Consumer Price Index of Los Angeles, California during the prior
year as published by the Department of Labor of the United
States of America. This index will hereinafter be referred to as
the CPL. Despite the above, the Base Rent will in no case be
increased by less than 3% or more than 5% at the time of each
increase.
The parties agree that if the Base Rent is paid late, the Lessee
must pay an additional amount equivalent to 3% (three percent)
for that month if the monthly payment of the Base Rent is not
made by the sixth
(6th) day
after it is due, provided that the Lessor has given the Lessee
written notice of this lack of payment by means of a
next-day
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messenger service with a good delivery reputation, such as
Federal Express or DHI, for example, and provided that the
Lessee does not make this payment within the next two
(2) business days following the date of notification.
FOUR. GUARANTEE
DEPOSIT
On the date this Lease is signed, the LESSEE will provide the
LESSOR with an amount sufficient to acquire the amount of
$3,885.57 dollars (three thousand, eight hundred eighty-five
dollars and 57/100, currency of the United States of
America) as a guarantee deposit, partial or total, according to
the case, in compliance with all of the LESSEE’s
obligations under this Lease. The above-mentioned deposit amount
will be returned to the LESSEE upon the termination of this
Lease or at the end of any of the extension options, according
to the case, provided that there is no balance due in favor of
the LESSOR and provided that the LESSEE returns the LEASED
PROPERTY in good condition, taking into consideration normal
wear and tear for the use of the building. The LESSEE will not
have the right to receive any interest for this deposit.
On the date this Lease Agreement is signed, the LESSEE will
provide the LESSOR with an amount sufficient to acquire the
amount of $750.00 dollars (seven hundred and fifty dollars and
00/100, currency of the United States of America) as a guarantee
deposit for the consumption of electricity which will be
credited to the final electricity xxxx.
FIVE. INTENDED
USE OF THE LEASED PROPERTY
The LESSER will use the leased property to conduct
non-contaminating industrial activities, mainly those relating
to storage according to applicable environmental legislation and
that do not produce odors, gases, smoke, vibrations, dust or
noise that could cause any damage to the LESSOR or to third
parties.
Both parties agree to comply with the Internal Regulations of
the “LA MESA PARQUE INDUSTRIAL” (LA MESA INDUSTRIAL
PARK) which are included as Attachment “C”.
SIX. RIGHT
TO A REDUCTION IN RENT
If the LEASED PROPERTY suffers serious damage or is destroyed by
any cause not imputable to the LESSEE that prevents the LEASED
PROPERTY from being used for the purposes for which it was
leased, the LESSOR must determine, within 30 (thirty) days after
the date the LESSOR is informed of said damage or destruction,
whether the LEASED PROPERTY can be restored or reconstructed
within the next 6 (six) months and notify the LESSEE of this
determination.
If the LESSOR determines that the LEASED PROPERTY cannot be
restored or reconstructed within a period of 6 (six)
months, both the LESSOR as well as the LESSEE will have to right
to terminate this Lease Agreement by providing written notice to
the other party.
It has been established that in the event of the partial
destruction of the LEASED PROPERTY, for reasons not imputable to
the LESSEE, the rent must be partially reduced in proportion to
the affect on the LESSEE’s use of the property. Therefore,
the LESSEE must provide written notice to the LESSOR no later
than one (1) business day after the date the LESSEE becomes
aware of said damage.
SEVEN. GUARANTOR
I-Flow Corporation, through its representative, Xx. Xxxxx
Dal Porto, with registered address at 00000 Xxxxxxx
Xx. Xxxx Xxxxxx, Xxxxxxxxxx 00000, XXX, is established as
the LESSEE’s Guarantor and guarantees all the commitments
that the LESSEE makes under this Lease Agreement. This
obligation will continue until the LEASED PROPERTY has been
returned to the LESSOR’s satisfaction.
In accordance with the above, the Guarantor, I-Flow Corporation,
agrees to sign the “Guarantee Contract” that is
attached to this Agreement as Attachment “D”.
EIGHT. IMPROVEMENTS
MADE BY THE LESSEE
The LESSEE will have the right to make interior modifications to
the LEASED PROPERTY at its own expense, provided that said
modifications do not affect the structural integrity or the
exterior appearance of the property.
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Despite the above, the LESSEE agrees not to make any structural
or other modifications without the prior written authorization
of the LESSOR. The request for these modifications must be sent
together with a set of plans and specifications to the LESSOR
for approval. If the LESSOR does not oppose these modifications
within a period of no more than 10 (ten) days, it will be
understood that the LESSOR has granted its approval. The LESSEE
must return the LEASED PROPERTY to the LESSOR in the condition
and with the characteristics that it was in at the time this
Lease Agreement was signed, with the exception of reasonable
wear and tear, and the LESSEE must pay the LESSOR for any
damages that result from taking out, removing or eliminating
said improvements in order to return the LEASED PROPERTY to its
original condition.
NINE. PUBLIC
UTILITY SERVICES AT THE LEASED PROPERTY
The LESSEE must pay for its own utility services that have been
or that will be established in the LEASED PROPERTY, such as
electricity, water, telephone, etc.
| • | Electricity: The LESSEE must pay the LESSOR for the cost of electricity in the form of a monthly fee based on the amount of consumption shown on the electric meter. This fee will be based on the rates used by the Federal Electricity Commission. |
| • | Water: The LESSOR provides water for the bathrooms. The LESSOR will charge the LESSEE for the additional consumption of water. |
| • | Telephone: The LESSEE must contract with TELNOR for the telephone lines and must agree to make periodic payments to this company for the cost of this service. |
TEN. MAINTENANCE
OF THE LEASED PROPERTY BY THE LESSOR
During the term of this Lease Agreement, the LESSOR must
maintain the roofs, exterior walls, exterior doors, floors,
electrical and sewage systems and any other component of the
Leased Property, including the water storage system and the
corresponding plumbing in good and working condition. Any
repairs that are necessary for the proper functioning of the
items that the Lessor is responsible to maintain will be made
immediately and will be made at the expense of the Lessor,
including reasonable preventive maintenance.
ELEVEN. MAINTENANCE
OF THE LEASED PROPERTY BY THE LESSEE
The LESSEE will maintain the electrical and sewage systems
(including the bathrooms), the hydro-pneumatic pump (excluding
the water storage system and its plumbing), the interior paint,
carpeting, non-structural walls, partitions, ceilings, doors and
windows in perfect condition at all times and will make all the
necessary repairs at its expense, including reasonable
preventive maintenance. The LESSEE agrees to maintain the LEASED
PROPERTY in good general condition and not permit the
accumulation of waste, garbage or any other rubbish in the
interior and exterior as well as in the property’s loading
and unloading areas. The LESSEE will not use the roof as a
storage area.
TWELVE. RIGHT
TO SUBLET
The LESSEE will have the right to totally or partially sublet
the LEASED PROPERTY, for industrial purposes, according to
applicable environmental legislation, only with prior written
authorization from the LESSOR with the understanding that the
LESSEE will be responsible for the obligations of said sublease
agreement.
THIRTEEN. TERMINATION
OF THE AGREEMENT BY THE LESSEE
The LESSEE has the right to terminate the Lease Agreement at any
time in the event of a case of force majeure, an unforeseen
circumstance or acts of Government (expropriation, confiscation,
etc.) that substantially impede the LESSEE’s industrial use
of the LEASED PROPERTY. If the LESSEE exercises this right, the
LESSEE must provide the LESSOR with written notice 60 (sixty)
days before the effective termination date.
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FOURTEEN. INSURANCE
During the term of this Lease Agreement, the LESSEE will pay the
LESSOR the amount of $1,095.93 dollars (one thousand,
ninety-five dollars and 93/100, currency of the United States of
America) every year on the anniversary date of the Lease
Agreement, as payment for a suitable insurance policy against
any damage caused to the LEASED PROPERTY by: fire, lightning,
explosion, collision of airplanes, smoke, storms, collision of
any type of vehicle, strike, popular or student riots, acts of
vandalism, flooding, and acts by employees, workers,
contractors, suppliers, clients, visitors and directors of the
LESSEE. This policy does not include the contents of the
building.
FIFTEEN. PAYMENT
OF VALUE-ADDED TAX
The Value-Added Tax resulting from this Agreement will be
covered by the LESSEE and approved by the LESSOR.
SIXTEEN. PARK
ASSOCIATION FEE
The LESSEE is responsible for paying the LESSOR the annual fee
of $996.30 (nine hundred ninety-six dollars and 30/100, currency
of the United States of North America) for maintenance and
security services.
SEVENTEEN. REGISTERED
OFFICES
For all the corresponding legal effects of this Lease Agreement,
the parties indicate the following addresses for service:
THE LESSOR
La Mesa Parque Industrial [La Mesa Industrial Park]
Calle E #4
Fraccionamiento Xxxxx. La Mesa
Tijuana, B.C. 2250
THE GUARANTOR
00000 Xxxxxxx
Xx. Xxxx Xxxxxx, XX 00000
THE LESSEE
Privada Baja California y Avenida Baja California
Edificio X-0 X Xxxxxxxxxxx 0, 0 x 0 [Xxxxxxxx X-0 A Incubator
Spaces 2, 4 and 5]
Xxxxx 00 Xxx Xx. 0000
Xx Xxxx Xxxxxx Industrial
Tijuana, B.C. 22116
Any notice to be delivered under this agreement must be sent to
the other party in writing or sent by certified mail or by
specialized messenger service (DHL, Fed-EX, UPS, etc.) to the
registered office indicated above, in which case the
corresponding notice will be considered delivered fourteen
(14) days after the date said notice is sent.
EIGHTEEN. TRANSFER
OR ASSIGNMENT
The LESSEE may transfer or negotiate its rights under this Lease
Agreement to any Credit or Banking Institution, either national
or foreign, or to any other legally established Company or
individual person, provided that the assignee or purchaser of
said rights agrees not to disrupt possession of the LEASED
PROPERTY or any other right belonging to the LESSEE under this
Lease Agreement, while the LESSEE shall continue to fulfill its
commitments made under this Agreement. If the LEASED PROPERTY is
purchased, the buyer must accept the LESSEE as a tenant under
this Lease Agreement and comply with all of the obligations
assumed by the LESSOR under this Lease Agreement. For its part,
the LESSEE agrees to recognize said assignee or any other person
who acquires the LEASED PROPERTY.
For this purpose, and only and exclusively for this purpose,
within ten (10) days after receiving the corresponding
notification, the LESSEE and the Guarantor must provide the
LESSOR with a copy of its last published Financial
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Statement and other documentation such as a report from
Dun & Xxxx street that the LESSOR requires for this
transaction.
In this case, the LESSOR will provide the LESSEE with written
notification about the transfer of rights under this Agreement
and from that time forward, the LESSEE must make the rent
payment to the registered address of the Institution, company or
person indicated, provided that said costs or payments do not
violate the corresponding tax and foreign exchange regulations.
NINETEEN. GOOD
FAITH, AUTHORITY AND INTENT
By signing this Agreement, both parties declare that there was
no error, coercion or bad faith between both parties and that
they have sufficient authority which has not been revoked,
reduced or limited in any manner.
TWENTY. BREACH
The parties expressly agree that in the event of the breach of
any of the obligations by any of the parties, the other party
shall have the right to either request mandatory compliance or
the termination of this Lease Agreement.
TWENTY-ONE. COMPETENCY
For all matters related to the interpretation and fulfillment of
this Lease Agreement, the parties expressly submit to the
authority and jurisdiction of the Courts of the city of Tijuana,
State of Baja California and to the applicable laws of said
institution and they hereby renounce any jurisdiction that may
correspond to them by reason of their present or future
registered office.
The Spanish language version of this Agreement shall prevail.
The parties are aware of the contents, scope and legal
consequences of each and every one of the preceding Clauses and
agree to comply with and respect them at all times and they sign
below before witnesses in the City of Tijuana, Baja California,
on July 29, 2003.
| THE LESSOR | THE LESSEE | |
|
BANCO UNION, S.A. Trustee of: BAJA DEL MAR, S.A. DE C.V. |
BLOCK MEDICAL DE MEXICO S.A. DE C.V. |
|
|
Lic. Xxxxxxxxx Xxxxx Xxxxxxxx
Legal Representative |
By: Xxxxx Xxxxxxxxx
Legal Representative |
|
|
BAJA DEL MAR, S.A. DE C.V.
|
||
|
Lic. Xxxxxxxxx Xxxxx Xxxxxxxx
Legal Representative |
| THE GUARANTOR | ||||
|
I-FLOW CORPORATION |
||||
| By: Xxxxx Dal Porto |
| WITNESS | WITNESS | |
|
Xxxxx Xxxxxxx Xxxxxxx
|
Xxxxx Xxxxxxx Xxxxxx |
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