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EXHIBIT 10.20
MEMORANDUM OF UNDERSTANDING
THIS MEMORANDUM OF UNDERSTANDING is made and executed at Bangalore this 13 day
of January, One Thousand Nine Hundred and Ninety Nine.
BY AND BETWEEN
Xx Xxxxx X Xxxxxx aged about 19 years, presently residing at Xx. 00, 0xx Xxxx,
0xx Xxxxx, Xxxxxxxxxxxxxxxx, Xxxxxx 571 012, represented by Xx Xxxxxxx Xxxxxx,
the lawful power of attorney holder of Xx Xxxxx X Xxxxxx (hereinafter referred
to as the "LESSOR" which expression shall mean and include his heirs, executors,
administrators, legal representatives and assigns) of the "ONE PART".
AND
M/s ACCELERATED NETWORKS (INDIA) PRIVATE LIMITED, a company incorporated under
the laws of India and having its Registered Office at C/o Lovelock & Lewes,
Chartered Accountants, `C' Wing, 14th Floor, Mittal Towers, 47/6, M G Road,
Bangalore 560 001, represented for purpose of this agreement by Xx Xxxx Xxxxxx,
Director, (hereinafter referred to as the "LESSEE" which expression shall mean
and include its successors in interest, legal representatives, administrators,
any of its associates, sub-concerns and permitted assigns) of the "OTHER PART".
(the Lessor and the Lessee would hereinafter as the context may permit be
jointly referred to as the "PARTIES")
WHEREAS, the Lessor has represented and assured that he is the owner and is
seized and in possessed and otherwise well and sufficiently entitled to the
office premises admeasuring 5500 Sq, Ft. bearing site Xx. 000, Xxxxx X,
Xxxxxxxxxxx Xxxxxxxxx (0xx Xxxxx), Xxxxxxxxx 560 034 [As delineated in the map
attached in ANNEXURE 1 hereto] which he has purchased from Xxxxx X Xxxxx vide
sale deed regstered as serial number 7155 dated 27 November 1987, in the office
of Sub-Registrar, Bangalore (South).
AND WHEREAS, there is no notice for acquisition or attachment and the aforesaid
premises is free from any encumbrances or charge of any kind and is permitted to
be used for commercial purposes.
AND WHEREAS, the Lessor has agreed to grant and the Lessee has agreed to accept
a lease of the aforesaid premises (which is more fully and particularly
described in the schedule hereunder given and hereinafter referred to as the
"SCHEDULED PREMISES")
AND WHEREAS, the Lessor and Lessee have agreed to enter into this Memorandum Of
Understanding (hereinafter referred to as `MOU') with the intend bind themselves
and each other to enter in to a Lease Agreement (hereinafter referred to as the
`AGREEMENT') in future for the Scheduled Premises on terms and conditions
stipulated herein below:
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IT IS HEREBY AGREED BY AND BETWEEN THE PARTIES AS FOLLOWS:
1) The Lessor hereby agrees to grant to the Lessee lease in respect of
the premises situate at site Xx. 000, Xxxxx X, Xxxxxxxxxxx Xxxxxxxxx
(0xx Xxxxx), Xxxxxxxxx 560 034, admeasuring 5500 Sq. Ft. as already
defined as Scheduled Premises herein above.
2) The Lessor will grant to the Lessee lease in respect of the
Scheduled Premises for a period of three years (hereinafter referred
to as the `Lease Period') commencing from 05 February, 1999. At the
end of the Lease Period, the Parties agree to extend the Lease
Period upon terms to be mutually agreed upon between them.
3) The Lessee shall pay to the Lessor for the Scheduled Premises lease
rental @ Rsl6/= per Sq. Ft., the monthly lease rentals would
therefore be equal to Rs88,000/= (Rupees Eighty Eight Thousand Only)
(herein after referred to as the `Rent') which would be payable by
the 5th day of the succeeding month. The Rent would increase by 10%
at the end of the first year on the, then prevailing rent and by a
further 10% at the end of the second year on the, then prevailing
rent till the end of the Lease Period, i.e., till the end of the
third year. The Parties however agree that the Rent would be paid
towards the Agreement ("Lease Rental") as well as towards the lease
of utilities on the Scheduled Premises ("Utility Rentals"). The
Lease Rental will be paid @ Rs. !0/- per Sq. Ft. and the Utility
Rentals will be paid @ Rs. 6/- per Sq. Ft.
4) The Lessee, further agrees to give an interest free, refundable
security deposit of Rs 13.2 lakhs (equivalent to 15 months rent)
which shall be refunded to the Lessee on the termination of the
Lease Period. Out of the said amount of Rs13.2 lakhs, the Lessee
agrees to pay an amount of Rs 50,000/= (Rupees Fifty Thousand Only)
to the Lessor by 15 January, 1999 which amount would be adjusted
towards the interest free security deposit amount at the time of
executing the Agreement. However, the Lessor and Lessee agree that
this adjustment of the said amount of Rs 50,000/= towards the
interest free refundable security deposit would be made only upon
the fulfillment of the condition stipulated in clause 7 hereinafter.
5) The Lessee undertakes to use the Schedule Premises for its office
purpose, i.e., for the development of computer software and hardware
design in terms of the Memorandum of Association of the Lessee.
6) The Lessee agrees not to carry out any structural additions or
alterations to the Scheduled Premises without the prior written
consent of the Lessor. The Lessee, however, shall have the right to
erect a microwave tower on top of the Scheduled Premises in order to
establish radio link with the Software Technology Park at Electronic
City, Bangalore. The Lessee further will have the right to install
the air-conditioner units, coolers, exhaust fans, and such
partitions as may be required without causing any damage to the
Scheduled Premises and shall have the right to remove all such
fixtures and fittings upon the termination of the Agreement.
7) A) The Lessor hereby represents that the present installed power
capacity in the Scheduled Premises is 3 KVA. However, the Lessor
agrees and assures that by 5
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February 1999, he would enhance this installed power capacity in the
Scheduled Premises from the present installed capacity of 3 KVA to
37 KVA. The Lessor and the Lessee also expressly agree that in the
event the Lessor is not able to enhance the installed power capacity
as stated herein, this MOU would stand terminated and the amount of
Rs 50,000/= paid by the Lessee to the Lessor in terms of clause (4)
herein above would be refunded by the Lessor to the Lessee within 3
days of the termination of this MOU, i.e., the amounts will be
refunded by 8 February 1999.
B) The Lessor and the Lessee also agree that in the event the Lessor
is able to enhance the installed power capacity as stated in clause
7 A above, then the Lessee's obligation to pay the Rent as mentioned
in clause 3 above would commence from the date on which the
installed power capacity has been enhanced.
8) During the Lease Period, the Lessee shall carry out day to day minor
repairs and maintenance of the Scheduled Premises including the
fittings and fixtures at its own cost. However, major repairs which
are attributable to the basic infrastructure of the Scheduled
Premises, shall be the responsibility of the Lessor which will have
to be carried out by him within 10 days of the receipt of the notice
for the same by the Lessee. Anything costing Rs 1,000/= (Rupees One
Thousand Only) or more will be deemed to be a major repair. In the
event the Lessor fails to carry out the major repairs within the
stipulated 10 days period, the Lessee will be at the liberty to do
the same and deduct costs so incurred from the monthly Rent.
PROVIDED THAT the Lessee shall permit the Lessor or his
representatives / agent to enter into the Scheduled Premises for
inspection at all reasonable hours with prior written permission
from Lessee.
9) The Lessee agrees to permit the Lessor or his authorised agent to
enter upon the Scheduled Premises for inspection and carryout the
necessary repairs at a reasonable time upon giving a prior notice of
atleast 4 days to this effect to the Lessee.
10) The Lessee agrees that on the expiry of the Lease Period, it would
hand over the vacant position of the Scheduled Premises in good
condition subject to normal xxxx and tare arising, from day to day
use and subject to the Lessor refunding the security deposit amount
as mentioned in clause 4 herein above.
11) The Lessor undertakes to pay all Municipal taxes, ground rent, fees
or levies in respect of the Scheduled Premises.
12) Any notice required to be served to the Lessor or the Lessee shall
be served by the Registered Post with acknowledgement due at the
addresses given in this MOU.
13) The Lessor and the Lessee agree to enter into and execute a Lease
Deed and an Agreement to Provide Utilities in terms of this MOU by 5
February 1999 provided the condition mentioned in clause 7 herein
above is fulfilled.
14) The Lessor and Lessee agree not to terminate the Agreement for a
period of 2 years from the date of the execution of the same.
However, thereafter both the parties would have
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the right to terminate the Agreement by serving the other party with
a 3 months notice in advance.
15) The payments agreed to be made under the Agreement would be made
after deducting tax at source in terms of the Income Tax Act and
Rules made thereunder.
16) This MOU and the Agreement will be subject to and be governed by the
laws of India and the Courts of Bangalore will have jurisdiction to
adjudicate any dispute arising under this MOU or the Agreement.
IN WITNESS WHEREOF the Parties hereto have set their respective hand and seals
to these presents on the day first herein above written.
WITNESS:
1. LESSOR:
/s/ Ashwini Ranjan
Represented By
Xx. Xxxxxxx Xxxxxx
(Father)
2. LESSEE
/s/ Xxxx Xxxxxx
Authorised Signatory
Xx Xxxx Xxxxxx
Director
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ANNEXURE 1
MAP OF THE SCHEDULED PREMISES
