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AGREEMENT REGARDING USE OF
PERSONAL PROPERTY
This AGREEMENT REGARDING USE OF PERSONAL PROPERTY ("Agreement") is
made and entered into as of August 11, 1997 by and between AlliedSignal
Avionics Inc., a Kansas corporation (the "Company"), and EFTC Corporation, a
Colorado corporation ("EFTC"), with reference to the following:
WHEREAS, Avionics, EFTC and AlliedSignal, Inc. entered into that
certain Master Agreement Regarding Asset Purchase and Related Transactions
dated July 15, 1997 (the "Master Agreement"), as amended by that certain First
Amendment to Master Agreement Regarding Asset Purchase and Related
Transactions, and that Second Amendment to Master Agreement Regarding Asset
Purchase and Related Transactions dated August 11, 1997, whereby Avionics
agreed to transfer certain assets related to the manufacture of electronic
assemblies to EFTC and EFTC agreed to enter into a Long Term Supply Agreement
with Avionics providing for the manufacture by EFTC of electronic assemblies
for Avionics and its affiliated entities;
WHEREAS, the parties desire to provide for EFTC's right to use and
operate certain equipment of Avionics described in Exhibit A, attached hereto
and incorporated herein by this reference, (the "Equipment") until the Avionics
Personal Property Transfer Date; and
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements hereinafter set forth, and in consideration of the
execution and performance of the Master Agreement and the Long Term Agreement,
the parties hereto agree as follows:
1. Right to Use Equipment. Subject to the terms and conditions of this
Agreement, Avionics hereby grants to EFTC free of charge for the Term (as
hereinafter defined), and any extension thereof, a non-exclusive,
non-transferable (except as provided in Section 6 below) right to use and
operate the Equipment for the limited purpose of performing its obligations
under the Long Term Agreement. This Agreement creates a right to use the
Equipment only and does not create or constitute a lease or sale of the
Equipment. EFTC shall have no ownership interest or ownership rights in or to
the Equipment. During the Term, Avionics shall not revoke the rights granted
hereby and shall not unreasonably interfere with EFTC's use of the Equipment.
This Agreement is intended to create a bailment relationship and not a sale,
lease or other transaction.
2. Warranty. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
AGREEMENT, OR ANY OTHER COMMUNICATIONS BETWEEN THE PARTIES ORALLY OR IN
WRITING, IT IS THE EXPLICIT INTENT OF EACH PARTY HERETO THAT AVIONICS MAKES NO
REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, BEYOND THOSE
EXPRESSLY GIVEN IN THIS AGREEMENT OR THE MASTER AGREEMENT, INCLUDING BUT NOT
LIMITED TO
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ANY IMPLIED WARRANTY OR REPRESENTATION AS TO CONDITION, MERCHANTABILITY OR
SUITABILITY AS TO ANY OF THE PROPERTIES OR ASSETS OF AVIONICS. EXCEPT AS
OTHERWISE SPECIFICALLY PROVIDED IN THIS AGREEMENT OR THE MASTER AGREEMENT THE
EQUIPMENT IS BEING PROVIDED ON AN "AS IS" BASIS.
3. Use Restrictions. EFTC shall not make any modification to the Equipment
without the prior written consent of Avionics. The Equipment may not be
removed from the premises where it is currently located without the prior
written consent of Avionics. EFTC shall use the Equipment for its intended use
only and in accordance with manufacturer's and Avionic's instructions. EFTC
agrees that it will cause its employees, agents, contractors and invitees to
comply with any and all of the Avionics' reasonable rules, regulations and
procedures pertaining to use of the Equipment as may be established by Avionics
from time to time.
4. Term. The term of this Agreement (the "Term") shall commence on the date
hereof and shall terminate on August 18, 1997 unless extended by mutual
agreement of the parties in writing. Upon the termination of this Agreement,
EFTC will return the Equipment to Avionics in the same condition as it was
provided to EFTC, reasonable wear and tear excepted.
5. Liability for Misuse or Damage. EFTC assumes responsibility for any
negligent or willful misuse of or damage to the Equipment by EFTC or its
employees, agents and invitees. EFTC agrees to indemnify, defend and hold
Avionics, its officers, directors and affiliated entities harmless from and
against any liability arising from or related to any such negligent or willful
misuse or damage, including, but not limited to property damage and personal
injury not compensated under applicable workers' compensation laws. To the
extent that any loss of any property by theft or otherwise, for personal injury
or property damage is proximately caused by the joint negligence or willful
misconduct of Avionics and EFTC or their respective employees, agents or
invitees, Avionics and EFTC shall be ratably responsible for such loss or
damage based upon their relative fault as determined by agreement of the
parties or pursuant to Section 14, as the case may be. It is expressly
understood by the parties that EFTC shall have no liability or other
responsibility for any misuse of or damage to the Equipment including, but not
limited to property damage and personal injury not compensated under applicable
workers' compensation laws, to the extent that such misuse, damage or injury
results from actions of EFTC, its employees, agents or invitees acting in
accordance with the specific directions of Avionics (including any rules,
regulations, policies, procedures or other instructions of Avionics relating to
health, safety or environmental matters). Except as set forth above, Avionics
bears the risk of loss of the Equipment.
6. Assignment. This Agreement, and all rights and obligations hereunder,
shall not be assignable by any party in whole or in part, except that (a)
either party may assign this Agreement and its rights and obligations hereunder
with the other party's prior written
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consent, and (ii) Lessee may assign this Agreement without the prior written
consent of Avionics to a subsidiary or affiliated entity. For any such
assignment, the assigning party shall remain obligated hereunder unless the
other party shall consent otherwise.
7. Entire Agreement. This Agreement, together with the Exhibits hereto, and
the Master Agreement constitute the parties' entire agreement with respect to
the subject matter hereof and supersede all prior statements or agreements,
both written and oral. This Agreement may be amended only by a writing signed
by each party hereto.
8. Governing Law. The validity, interpretation and construction of this
Agreement, and all other matters related to the Agreement, shall be interpreted
and governed by the laws of the State of Florida.
9. Notices. Notices under this Agreement shall be in writing and sent by
confirmed facsimile, personal delivery or overnight delivery service to the
addresses specified in or pursuant to the terms of the Master Agreement and
shall be effective as specified in the Master Agreement.
10. Severability. If any term or provision of this Agreement, or the
application thereof to any person or circumstance, shall to any extent be found
to be invalid, void, or unenforceable, the remaining provisions of this
Agreement and any application thereof shall, nevertheless, continue in full
force and effect without being impaired or invalidated in any way.
11. Waiver. No waiver of any term, provision or condition of this Agreement,
whether by conduct or otherwise, in any one or more instances, shall be deemed
to be or be construed as a further or continuing waiver of any such term,
provision or condition or as a waiver of any other term, provision or condition
of this Agreement.
12. Independence. The parties shall at all times act independently. Nothing
contained in this Agreement, shall be construed to make one party the partner,
joint venturer, principal, agent or employee of the other party hereto.
Neither party shall have any express or implied authority to act for or on
behalf of the other or bind the other contractually. Each party is solely
responsible for payment of (i) all income, disability, withholding, and other
employment taxes as well as (ii) all medical benefit premiums, vacation pay,
sick pay or other fringe benefits resulting from its retention of its officers,
directors, employees, agents, affiliates and contractors. Each party shall
indemnify, defend, and hold the other harmless from any claim for any such tax
or benefit payment.
13. Headings. The headings herein used are for convenience purposes only and
shall not be used to construe the meaning of this Agreement in any respect.
14. Arbitration. Any controversy, claim or dispute arising out of or relating
to this Agreement or the transactions contemplated hereby or the breach,
termination, enforcement, interpretation or validity hereof, including the
determination of the scope or applicability of this agreement to arbitrate
(collectively "Dispute"), shall be determined by arbitration in Phoenix,
Arizona before a sole arbitrator. The following shall apply to any such
arbitration:
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14.1 The arbitration shall be administered by the American
Arbitration Association ("AAA") pursuant to its Commercial Rules and
Supplementary Procedures for Large, Complex Disputes.
14.2 The arbitrator shall not be an officer, employee, director or
affiliate of any party hereto or of its affiliates. If the parties are unable
to agree on an arbitrator within 30 days of the filing of the Demand for
Arbitration, an arbitrator shall be selected pursuant to the rules and
procedures of the AAA.
14.3 Any party may seek from any court interim or provisional relief
that is necessary to protect the rights or property of that party, pending the
appointment of the arbitrator or pending the arbitrator's determination of the
merits of the controversy.
14.4 The parties shall bear their own costs and expenses, including
attorneys' fees, but the arbitrator may, in the award, allocate all of the
administrative costs of the arbitration (and mediation, if applicable),
including the fees of the arbitrator and mediator, against the party who did
not prevail.
14.5 The arbitration award shall be in writing and shall specify the
factual and legal bases for the award. Judgment on the award may be entered in
any court having jurisdiction.
15. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall constitute an original instrument and all of which together
shall constitute the same instrument.
16. Definitions. Capitalized terms used herein without definition shall
have the meanings ascribed thereto in the Master Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
ALLIEDSIGNAL AVIONICS INC.,
a Kansas corporation
By: /s/ Xxx Xxxxxx
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Title: Subcontracts Program Manager
EFTC Corporation,
a Colorado corporation
By: /s/ Xxxxx Xxxxx
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Title: Treasurer
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EXHIBIT A
The Equipment
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