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Exhibit 10.1 (f)
CONTRACT
on the Lease of Commercial Premises
concluded pursuant to the provisions of Law 116/1990 Zb., as later modified and
amended, between the following contracting parties:
Heavy Engineering Works, joint-stock company, 000 00 Xxxxxxx-xx-Xxx, Xxxxxx
Xxxxxxxx, represented by Messrs. Eng. Xxxxx Barancok, CSc., chairman of the
Management Board, and Eng. Xxxxxxx Xxxxxx, member of the Management Board
(hereinafter "Lessor"); Bank reference: VUB joint-stock company, Povazska
Bystrica Branch; Account no.: 000-00000-000/0200; ID number: 36 001 708; Tax
number: 36 001 708/668
and
the founders of XXXXX-ZTS joint-stock company, with registered office in 000 00
Xxxxxxx-xx-Xxx, Xxxxxx Xxxxxxxx,; XXXXX-SUNDSTRAND GmbH, Xxxxxxx 00, 00000
Xxxxxxxxxx, Xxxxxxx Xxxxxxxx of Germany, represented by Xx. Xxxxx Xxxxxxx,
general manager (hereinafter XXXXX-SUNDSTRAND or SAS); XXXXX-SUNDSTRAND (CS)
limited liability company, K vystavisku 00, 000 00 Xxxxxxx, Xxxxxx Xxxxxxxx,
represented by Eng. Xxx Xxxxxx, CSc., general manager (hereinafter SAS/CS);
Heavy Engineering Works, joint-stock company, 000 00 Xxxxxxx-xx-Xxx, Xxxxxx
Xxxxxxxx, jointly represented by Messrs. Eng. Xxxxx Barancok, CSc., chairman of
the the Management Board, and Eng. Xxxxxxx Xxxxxx, member of the Management
Board (hereinafter "ZTS"); DCA-INVEST, limited liability company,
Xxxxxxx-xx-Xxx, 000 00 Xxxxxx Xxxxxxxx, represented by Eng. Milan Strapka,
general manager (hereinafter INVEST)
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Article I.
Object and Purpose of the Tenancy
1. The Lessor leases to the Lessee the following specified premises:
- 10,852 m2 production space,
- 7,144 m2 covered auxiliary space,
- 1,253 m2 office space,
- 2,711 m2 space designated for sanitary facilities,
- 18,599 m2 land under the structures,
- 3,612 m2 land adjacent to the structures.
The premises to which the lease pertains are located in the Lessor's
property, which is designated Buildings DM3, DM3a, Spanesammlung and
leased land, Lot Nos. 3747/2, 3747/7, and 3747/33. The passport to the
buildings and the sketch of the land adjacent to the structures
constitute integral parts of this contract.
2. The Lessee leases the commercial premises noted in Point 1 of this
article for the purpose of engaging in production and in associated
activities for the newly founded company XXXXX-ZTS joint-stock company in
keeping with the object of business.
3. The Lessor is the exclusive owner of the commercial premises that
constitute the object of this contract and is entitled to dispose of said
commercial premises.
4. The contracting parties have agreed that the rights and obligations from
this contract devolve to the legal successors of the Lessee only with the
express written consent of the Lessor.
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Article II.
Term of the Tenancy
1. The lease is concluded for a limited term, beginning on 4/1/1997, namely
for 5 years beginning with the effective date of the lease in question.
The agreed term of 5 years can be renewed by the Lessee twice by 5-year
periods based on his option; thus, the total term of the limited-term
lease is 15 years in the event that the Lessee twice asserts his renewal
option.
2. The assertion of the option by the Lessee must take place toward the
Lessor in the twelfth month of the 5th year of the lease.
3. The Lessor turns the object of the lease over to the Lessee in a
condition that is suitable for the contractual use. The document
regarding the commencement of use shall serve as the official record
pertaining to acceptance of the object of the lease, signed by both
contracting parties.
4. The Lessee has a preferential right to the conclusion of a new lease with
the Lessor after the time agreed to in Point 1 of this article has
expired.
Article III.
Rent, Services, Due Dates, Payment Method
1. The contracting parties agree under the meaning of Section 7 Law No.
116/1990 Zb. and in accordance with Law No. 18/96 Z.z. on prices to
the following rental fees:
- rent minus heating expenses - production space
10852 m2 x 400.00 Sk 4,340,800.00 Sk/year
- rent minus heating expenses - covered auxiliary space
7144 m2 x 300.00 Sk 2,143,200.00 Sk/year
- rent minus heating expenses - office space
1253 m2 x 500.00 Sk 626,500.00 Sk/year
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- rent minus heating expenses - sanitary facilities
2711 m2 x 250.00 Sk 677,750.00 Sk/year
land under the structures
18599 m2 x 20.00 Sk 371,980.00 Sk/year
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Total rent 8,160,230.00 Sk/year
a) The Lessor provides to the Lessee firefighting and security services in
the amount of 1,000 Sk/year per employee of the Lessee. The Lessee shall
pay this amount to the account of the Lessor on a monthly basis.
b) The Lessee is obligated to pay a prorated fee for operating costs
associated with the use and cleaning of the paths, walkways, and parking
lots and with the formation of a reserve fund for repairs in the amount
of 277,574.00 Sk/year, which the Lessee shall pay to an account of the
Lessor on a monthly basis, whereby said fee is payable until a separate
entrance is created for the Lessee.
2. The Lessor reserves the right to raise the amount of rent and service
fees once a year. If the quarterly inflation rate according to official
statistics exceeds 10%, then the provision of the first clause does not
apply and the Lessor is entitled to raise the amount of rent and service
fees following publication of the indicated figures.
3. The Lessor also offers to the Lessee further performances, comprising the
supply of heat, electricity, drinking water, and industrial water, and he
provides for sewer services, waste water treatment, the supply of
compressed air, and the liquidation of the emulsions from the machine
tools. For these services, which he provides to the Lessee in 1997, he
shall charge the following amounts based on the agreement between the two
contracting parties:
Heating (0.4 Gj/m3) 225.00 Sk/Gj
Electricity 2.23 Sk/kWh plus lump sum
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6,900.00 Sk/p.a.
Drinking and industrial water 8.00 Sk/m3
Sewer services / 9.50 Sk/m3
Waste water disposal
Compressed air (approx. 6 Atm.) 0.35 Sk/m3
Liquidation of the emulsions from 1,100.00 Sk/m3
the machine tools
Beginning in 1998, the Lessor shall substantiate any price increase in
the noted services with the overall rise in prices, and the Lessee shall
accept this price increase on the basis of the substantiated overall rise
in prices.
4. In the event of restrictions on the supplied energy as a result of
unfavorable conditions on the energy market, this shall be accepted by
the Lessee without any sanctions toward the Lessor.
5. The payments for rent and services are effected as follows:
a) the Lessor shall xxxx the Lessee for the rent on all leased premises once
quarterly in the form of an invoice, the payment of which is due within
14 days of its date of issue and which the Lessee shall transfer to the
Lessor to the account indicated to him,
b) the services provided to the Lessee by the Lessor, as described in Point
3, shall also be billed to the Lessee by the Lessor, the payment of which
is due within 14 days of its date of issue and which the Lessee shall
transfer to the Lessor to the account indicated to him,
6. The contracting parties have agreed that the Lessee shall pay all costs
associated with the execution of repairs to or reconstruction of the
leased premises, insofar as these are occasioned by the Lessee.
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Article IV.
Further Agreements Between Lessor and Lessee
1. The Lessor agrees that on the date of the official transfer of the office
space pursuant to this contract, he shall transfer to the Lessee 6 state
telephone connections over which the Lessor currently disposes. The
Lessee shall bear the costs for the use of the telephone connections. The
Lessee agrees to transfer the telephone connections back to the Lessor
upon termination of the tenancy.
At the same time the Lessor agrees that he will do everything to ensure
that the Lessee has adequate state telephone connections and
long-distance connections in the future.
2. The Lessor agrees that he will provide to the Lessee separate access to
the leased premises. To this end, a separate road connection - access
street is being constructed, which is intended for the transport of
persons and goods (under the meaning of the foundation agreement).
Article V.
Rights and Obligations of the Contracting Parties
1. The Lessor agrees to ensure to the Lessee proper use of and benefit from
the leased commercial premises and to provide to him the services
associated with the tenancy as described in Art. III of this contract.
2. The Lessee agrees to perform minor repairs and ordinary maintenance at
his own expense, not to exceed the amount of 1,000.00 Sk per repair. The
Lessee is also required to notify the Lessor of the scope of necessary
repairs that go beyond the scope of minor repairs within the specified
time limit and without delay, and to allow him to perform such repairs.
The Lessee shall notify the
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Lessor without delay of any damage that occurs as a result of defects in
the leased premises. Upon nonperformance of this obligation, the Lessee
is liable for the damages incurred by the Lessee as a result of that
fact.
3. In the event that the Lessee notifies the Lessor of needed repairs
or of damages that have arisen as a result of defects in the leased
premises, and the Lessor does not eliminate the reported defects or
damages within a reasonable period, the Lessee is entitled to
secure the elimination of the defects and damage at his own expense
and to xxxx the incurred costs, in an ascertainable amount, to the
Lessor, either directly or through offsetting with the due rent.
This provision does not affect the terms set out in Art. III, Point
5.
4. The Lessee has the right to a discount on the rent if because of defects
that he has not caused and which he has reported in a timely fashion he
has been unable to use the object of the lease in the agreed manner prior
to their elimination, except in the case of accident, force majeure, or
intervention by state or public authorities. The claim for discounting of
or release from the rent must be asserted against the Lessor without
delay.
5. The Lessee can perform alterations only with the prior written consent of
the Lessor. At the same time, he is obligated to comply with the
provisions of Law No. 50/76 Zb., pursuant to the provisions of later
regulations, applicable implementing regulations, and the Slovak State
Standards (STN).
6. The Lessee is furthermore obligated to ensure, at his own expense, the
discharge in the leased premises of all obligations resulting from
regulations pertaining to industrial safety and health protection, to the
protection of property and hygiene, and to environmental protection. The
parties to this contract have similarly agreed, in accordance with the
Law on Fire Protection as
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last amended, that the Lessee shall discharge in the leased commercial
premises all obligations resulting from that law.
7. If the Lessee uses his own funds to alter the object of the lease during
the term of the tenancy, the Lessor shall grant his consent to the
Lessee's claiming of the relevant accounting depreciations in his
accounting records during the term of the tenancy.
8. The Lessee insures all objects that are brought onto the premises leased
from the Lessor, especially inventories of goods, materials, and material
fixed assets.
9. The Lessor guarantees the security of the structures leased to the Lessee
so that there can be no losses of or damages to the property of the
Lessee.
10. The Lessee is entitled to install in the leased structures an information
display bearing the Lessee's company name to the standard extent and of
the standard size.
11. The Lessee is prohibited from subletting the commercial premises. The
Lessee agrees, upon termination of the tenancy, to return the leased
premises in a condition suitable for the agreed use, with due
consideration for the length of use, and if necessary to restore them to
their original condition.
12. The Lessor reserves the right to enter the leased premises for the
purpose of their inspection by mandated employees following advance
notification of the Lessee, but as a rule no more frequently than once
per quarter.
13. The Lessee is obligated to maintain the land adjacent to the leased
structures (mowing, protecting against ecological damage, not storing
surplus material there, etc.). The Lessee shall not pay rent for land
that is maintained in this way.
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14. The Lessee is obligated to safeguard from third parties all secret and
confidential information regarding technical, economic, financial,
business, and other facts acquired from ZTS Dubnica n/V joint-stock
company and not to use such information for its own purposes or other
activities without the written consent of the Lessor. The facts noted
under Point 3.1., OSPR No. 12/93, which constitute the annex to this
contract, are subject to such safeguarding.
Article VI.
Termination of the Tenancy and Notice Period
1. The tenancy is terminated upon the end of the agreed term of the tenancy.
2. The tenancy can also be terminated prior to the end of the agreed term of
the tenancy through a written agreement between the contracting parties,
or for the reasons for termination of the tenancy that apply to both
contracting parties on the basis of the provisions of Section 9 Law No.
116/90 Zb.
3. During the agreed term of lease, the Lessee is entitled to terminate the
lease with 6 months' notice.
Article VII.
Concluding Provisions
1. The contract becomes valid on the date of its signing by the contracting
parties and takes effect on 4/1/1997.
2. Any change or addition to this contract must be in the form of written
addenda to the contract, which must be signed by statutory
representatives of the contracting parties.
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3. The contracting parties have familiarized themselves with the contents of
this document and have signed it as an indication of their consent
thereto.
4. This contract has been prepared in 4 copies, of which each participant
receives 2 copies, one each in the Slovak language and in the German
language. In the event of conflict between the two language versions, the
Slovak version shall be definitive for interpretation of the contract.
The contracting parties have agreed that the relations not governed by
this contract pursuant to Law No. 116/90 Zb., the Civil Code, and other
binding, applicable provisions of law are dissolved.
5. Presented as attachments were the following annexes to the contract,
which are an integral part of this contract:
- official record of acceptance and delivery of possession
- excerpt from the Land Registry
- ground plan of adjacent land,
- excerpt from the company's rules and regulations
In Bratislava, 12/4/1996
[signature] [signature]
---------------------------------- ----------------------------
Eng. Xxxxx Barancok, CSc. Eng. Xxxxxxx Xxxxxx
[signature] [signature]
---------------------------------- ----------------------------
Xx. Xxxxx Xxxxxxx Eng. Xxx Xxxxxx, CSc.
[signature]
------------------------------------------
Eng. Xxxxx Xxxxxxx
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Agreement for change of lease
As a result of the transfer of [illegible] property, there has been a
change in the property rights from the firm Heavy Engineering Works
Dubnica-on-Vah, joint-stock company, to the firm ZTS - Dubnica-on-Vah plus,
joint-stock company.
The property transfer concerns the lease contracts concluded with the
company XXXXX-ZTS, joint-stock company.
The following leases are affected:
[see original] dated [see original]
" "
" "
" "
" "
The company ZTS - Dubnica-on-Vah enters into the [illegible] or the above
listed lease contracts as the lessor and assumes to itself all rights and
obligations stemming from these contracts for the original lessor Heavy
Engineering Works Dubnica-on-Vah, joint-stock company.
With this agreement [illegible] the lessor toward the lessee [illegible]
from 11/1/1997:
ZTS - Dubnica-on-Vah plus, joint-stock company
plot ZTS Xx. 000
000 00 Xxxxxxx-xx-Xxx
represented by: Ing. Xxxx Xxxxxxx
Member of the Board
Ing. Xxxxxxx Xxxxxxx
Signing Clerk
Bank: VUB, joint-stock company, Povazska
Bystrica Branch
Account no: [see original]
Commercial ID: [see original]
Reference ID: [see original]
Dubnica-on-Vah: 11/28/1997
On behalf of
ZTS - Dubnica-on-Vah plus, Heavy Engineering Works XXXXX-ZTS
Joint-stock company Dubnica-on-Vah Ltd.
Joint-stock company
[names & rubber stamps of signatories]
[Signatures at the bottom of the Change of Lease Agreement]
[1st column]
On behalf of ZTS - Dubnica-on-Vah plus, joint-stock company
Ing. Xxxx Xxxxxxx
Member of the Board
Ing. Xxxxxxx Xxxxxxx
Signing Clerk
[2nd column]
On behalf of Heavy Engineering Works
Dubnica-on-Vah, joint-stock company
Ing. Xxxxx Barancak, CSc.
Chairman of the Board
Ing. Xxxxxxx Xxxxxx
Member of the Board
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[3rd column]
On behalf of XXXXX - ZTS. joint-stock company
Ing. Xxxxx Xxxxx
Chairman of the Board
Ing. Xxx Xxxxxx, CSc.
Member of the Board
[Each column also contains the rubber stamp of the firm concerned]
