LEASE AGREEMENT
Exhibit
10.19
In the
autonomous City of Buenos Aires, on the day 19 of the month of August, 2009,
between ACRILICOS XXXXXXXX
X.X., company which address is Avda. Gral. Roca 4250 de Florida, Pdo. De
Xxxxxxx Xxxxx, Pcia. De Buenos Aires, represented in this act by its legal
representative, Xx. Xxxxx Xxxxxxx XXXXXXXX, Argentinean, ID#
25.044.694, in accordance with the attached power of attorney (Exhibit “A”),
hereinafter “THE
LESSOR”, in one hand; and in the other hand, LAKELAND ARGENTINA SRL
(incorporation pending), represented in this act by its
manager partner XXXXXXXX
XXXXXXX XX XXXX ID# 24.069.380, which address is Corrientes No. 1(not
legible) 86 piso 13 Capital Federal hereinafter “THE LESSEE”, and
collectively LESSOR and LESSEE called the PARTIES, agree in entering into this
LEASE AGREEMENT under the following terms:
FIRST: The
LESSOR, hereby lets to
the Lessee, the functional unit No. 110 with a surface of 820 m2 composed of a
storehouse and offices located within a bigger property, owned by the LESSOR,
which name is Centro Industrial y Comercial Florida Oeste, located at Avda.
Gral. Roca No. 4250 between X.X. xx Xxxxxx and Xxxxxxx Xxxxxx, Florida, Pdo. De
Xxxxxxx Xxxxx, Pcia de Buenos Aires, intended for business and industrial
development, functional unit which shall be called THE PROPERTY and that arises
from the sketch signed in counterparts and that is attached to this agreement
made part of it (Exhibit “B”). The property is released by this act
to the satisfaction of the LESSEE as per the asset inventory that the parties
sign along with this (Exhibit “D”).
SECOND:
Both parties consent to this contract within the following context: a) the
guaranty granted by the National State (Law 21342, Article 6) regarding the
establishment of freedom of contract in rental matters, b) the application of
the Civil code in its current version (Law 21342, Article 29) whose rules the
parties submit as a matter of suppletory law, only for all points not expressly
regulated by this agreement, that without prejudice to respect the mandatory
regulations of Laws 23091, modified by Law 25.561 and 25628, c) the current
uncertainty regarding the future acquisitive value of Argentinean
currency combined with the prohibition of any kind of default currency
actualization (Law 23928, Art. 7 modified by Law
25.561).
THIRD:
This contract has a length or term of thirty six (36) months, being valid from
August 19, 2009, expiring on August 18, 2012 necessarily, in which date this
contract shall be automatically expired with no need of any notification but
this, being the LESSEE required to return the property to the LESSOR or its
representative at its end, free of goods, occupants and/or intruders, letting
the LESSOR off the obligation to perform the requirements foreseen in Arts.
1604, 1610, 1622 and cites of the Civil Code. The failing to do so,
without prejudice of eviction that the LESSOR could demand plus the payment for
damages, costs and fees that might be granted; for each day that the LESSEE
exceeds the occupation of the property, besides the corresponding rent, shall
indemnify with a daily fine of one percent (1%) of the corresponding lease at
that time, for each day that improperly pass in the property and until the
effective reception of the property by the LESSOR .- The anticipated termination
shall be governed by Law No. 23.091, Art. 8.-
FOURTH: The
LESSEE states she knows the Internal Use Regulation of the Florida Oeste
Industrial Park, attached to this agreement as (Exhibit “C”), agreeing to comply
with it, receiving in this act a complete copy of the Regulation. The
Parties would be able to agree the extension of the term of this contract at its
expiration, for a term equivalent to the original or another term agreed at that
time, having the LESSEE, in such case, to communicate the LESSOR about such
intention within 60 (sixty) natural days before the expiration of the contract
by any reliable means, having the LESSOR to express its decision within the same
granted term. In such case, the clauses of the original contract
shall prevail without prejudice of the variation that could be verified in the
lease amount as per the mechanism provided in clause twenty nine of this
contract.
FIFTH:
In the case the LESSOR continues receiving the lease after the expiration of the
contractual term, either incremented, and any the raise would be, that shall not
be constructed as novation or renewal, being both parties able to terminate the
lease after the expiration of the term by which the rent had been
charged. The termination of the lease should be justified by a
written letter sent by any of the parties requesting the early termination or
notifying the ending of the lease term without the intention to extend
it. In all the cases the lease, complementary benefits and, if
applicable, the corresponding fines shall continue until the property is truly
reinstated to the LESSOR and to the extend it is in the agreed
conditions.
SIXTH:
The LESSEE could be able to terminate unilaterally this contract, with a
previous notice, sent by reliable means, of no less than 60 (sixty) days,
strictly adhering to Law 23091, art. 8, regarding terms of effectiveness,
previous notification and indemnity amounts.
SEVENTH:
The monthly amount to be paid shall be ELEVEN THOUSAND FIVE HUNDRED PESOS
plus VAT ($11,500 plus VAT) also charging to the LESSEE in the amount of
rent the payment to the LESSOR of the proportional part corresponding to the
LESSEE regarding the monthly taxes for municipal services on the property by the
Xxxxxxx Xxxxx Municipality, or the corresponding municipality to the property,
in a 3% proportion of the total amount. The local property tax
perceived by the Provincial Revenue Office of Buenos Aires shall be paid by the
LESSEE in a 3% proportion corresponding to it as well as the Aguas Argentinas’
services, in a 3% proportion corresponding to it for the occupied surface, all
of which is paid every month within the expenses payment. Any other
direct or indirect tax created in the future and applied to the amount of rent
agreed in this contract, that shall be notified by reliable means to the LESSEE,
shall be added as per its aliquot resulting from the rent amount and its payment
shall be paid by the LESSEE, integrating such tax the payment of the monthly
rent starting from the date of its legal enforceability. The Value
Added Tax that eventually affects the rent or the obligations assumed towards
the LESSOR shall be supported by the LESSEE.
EIGHTH:
The rent is agreed by entire month and shall be paid in advance from the
1st
to the 10° day of each month, in the address of the Business Center, located in
Ave. Gral Roca 4250 de Florida, Pcia de Buenos Aires, upon receipt of invoice by
bi-annual periods and receipt for such purpose, or as duly indicated by the
LESSOR, within the Federal Capital, therefore the LESSOR is not obliged to
receive or return money for fraction of month.- The payment shall be by-annual,
through six checks issued at the day 30, 60, 90, 120 and 150. The
LESSOR expressly authorizes to XXXXX XXXXXXXX (ID# 25.044.694), ELISA XXXXXX
XXXXXXXX (ID# 13214065) and/or XXXX XXXXXXX XXXXXXX (ID# 12.599.982) to receive
the rent on its behalf and upon its orders. Debt shall become
delinquent by operation of law, without need to notify after the day 10° of each
month.- If the payment is not done on time, the LESSEE should paid by ways of
fine the amount resulting from adding the monthly rate of 3% to the
rent.
NINTH:
This contract is not transferable under any circumstance, either
partially nor totally, temporary or free or charge, and it is stated that the
LESSEE cannot be able to assign, transfer and/or sub-lease the leased property;
and it shall use the property as business premises for the manufacturing, sales,
consignation, commission, representation, distribution, import and export of
clothing, footwear, objects, machines, tools and all kind of products and
devices to be used as industrial safety and protection attire, personal, sport,
cleaning and fire, high rise, low and high temperatures, etc. and
derivatives, and storehouse of goods related to its line of business, and agrees
to use it as per the rules stipulated by the Municipality of Xxxxxxx
Xxxxx, or the corresponding municipality for the property and
premises of that kind that it states to know and undertakes to: a) do not commit
any action that threaten the moral and/or good customs; b) do not deny the
access to the premises to the LESSOR or its representatives to check on the
occupation status and/or preservation of the property and to perform any repair
on it. In the case that the LESSOR intends to exert its
access right to the leased functional unit it should give a previous
notification with at least seventy two (72) hours in advance to the
LESSEE. The LESSOR expressly authorizes the LESSEE to store goods and
dangerous devices, having, in the case of storage of sprays or similar products,
to adopt the necessary safety measures and to comply with the current municipal
regulations for the storage of this kind of goods. The LESSEE shall
have free and unrestricted access to the premises of the Centro Industrial y
Comercial Florida Oeste, the seven (7) days of the week, and the twenty four
(24) hours of the day. The LESSEE undertakes to contract a general
and third party liability insurance on the building in its PROPERTY’s surface in
anticipation to losses and fire, with policy endorsed to the LESSOR that covers
all foreseeing contingencies over persons, assets and goods existing in the
storehouse, assuming the LESSEE the risk for the handling of the goods stored in
the premises. The lack of compliance of this clause shall be
considered as a violation of this contract. In this vein it agrees to do not
sell, promote or commercialize any product of direct or indirect competition for
the products commercialized by Acrilicos Polopoli S.A. or PALOPOLI (elements and
supplies for the visual communication industry), which it declares to know to
date, and that the same are out of its trading practice. Nevertheless
the LESSOR accepts that the LESSEE commercializes safety attires including cat’s
eyes and fluorescent strips.
TENTH:
The LESSEE shall not be able to refurbish without the LESSOR’s previous
authorization in written; if the improvements are done, they shall remain in the
property without obligation of compensation.- As per all constructions made by
the LESSEE, they shall remain once the contract is expired in favor of the
LESSOR, with no right whatsoever for the LESSEE to acknowledges, indemnity or
compensations for them. The PROPERTY should be restituted as of its
former state it was received, except for the natural wearing over time, with its
sanitary and electrical installations, devices, building installations and
enclosures, being the LESSEE able to withdraw the unbounded equipment, air
conditioning, furniture, etc. which are not bonded to the property and that are
of its own.
ELEVENTH:
The LESSEE undertakes to the preservation of the devices, installations and
accessories of the property and to repair any damage arising from the use and
should let the LESSOR know about any damage in the property.- Exhibit “D” is
attached to this agreement the inventory of the assets contained in the property
which belongs to the LESSOR.
TWELFTH:
The LESSOR shall not be responsible for any damages and/or
accidents that the LESSEE could have in its person and/or third parties due to
fire or total or partial destruction of the property, furniture, devices, etc.
and/or all persons working in the property, unless such damages and/or accidents
are the result of structural failures or defects of the PROPERTY for which the
LESSOR should be responsible.- In case of destruction or partial wearing of the
PROPERTY due to force major or third party acts, for which the Parties should
not be responsible, the art. 1521 of the Civil Code should be
applied. The restriction or suspension of the PROPERTY’s services
shall not be cause for rent suspension, withholding or
reduction.
THIRTEENTH:
The interior pathway of the property shall be of common use for the LESSEE and
the rest of the property’s dwellers, including the LESSOR itself, being such
pathway of free movement, not being possible to stand in the way of exit and
entrance of vehicles. The LESSOR authorizes the use of 2 (two)
parking lots to the LESSEE for its use, being able to use them at day and night
free of charge, having the LESSEE to state in written the domains of the
authorized vehicles to enter in the property permanently. The rest of
the vehicles that enters to the general property for work purposes, should be
authorized in the control post at the entrance and shall be subject to the
entrance general conditions and property capacity, after stating its allowance,
motive and load as well being its exit authorized by the LESSEE by express note
stating the leaving load, if any.
FOURTEENTH: The
lack of express reservation by the LESSOR either at the moment the PROPERTY is
restituted, or at the moment to receive payments, shall not be construed as a
waiver to rents, tributes, interests, fines, legal accessories or any other
right or claim.
FIFTEENTH:
The rent, proportional interests and the fees for services against the Lessee,
integrate the rent amount and could be claimed through summary
proceedings. The invoices and/or tax receipts will have authenticity
presumption, being differed to regular procedures of repetition, any challenge,
in order, in form or content. The cost of the execution and for the
entire trial due to the no compliance of the LESSEE, should be paid by the party
the intervening judge determines. Once a year of less is remaining of
the contract term of effectiveness, the LESSOR shall be able to require the
LESSEE to sign an agreement to vacate to be judicially approved; the generated
costs shall be paid by the LESSOR. If the LESSEE refuses to sign such
agreement and the LESSOR promotes an early vacate trial, the costs for such
trial shall be charged to the LESSEE. If such previous requirement
does not take place, each party should bear its own costs for the early vacate
trial, if, after the acceptance of the request, the LESSEE proceeds to return
the PROPERTY in terms and form.
SIXTEENTH:
It is agreed that the LESSEE shall be the only responsible for the payments of
electricity, gas (settlement of cable laying, meter and final gas fitting out in
charge of the LESSOR) and telephone charges, services that shall be obtained in
its name, relieving the LESSOR of all responsibility, being the LESSEE in charge of all the
their processing, design
of electrical layouts and plants, piping layouts, etc. With regard to municipal approval, it
should be processed by the LESSEE and it should submit a copy to the
LESSOR.
SEVENTEENTH: As
per the general and common services of all property as common area, which the
LESSEE uses in proportional part, as Aguas Argentinas, Electricity, Private
Security, Hygiene, etc. they shall be supported by the LESSEE in a 3% percentage
of the same, and prorated by surface also as expenses of common
sectors. The LESSEE shall add to the income a month of expenses
calculated on the last due date as expenses fund as it shall pay them one month
in advance that shall be credited in the due date of the last month
of the lease. The services invoiced by the LESSOR for Administration
or the administration it designates for such purpose shall have its 3% fee of
the rent amount, being also such percentages part of the amount of rent and
executables to itself, and shall be expressed in the quarterly invoice having
the LESSEE to add such service along with the monthly rent. The
expenses should be paid within 5 days of the reception of the respective
payment, and being considered as xxxxx cash fund no delay in payment shall be
accepted due to accounting reasons, accruing the corresponding
penalties.
EIGHTEENTH:
The LESSOR expressly accepts the key consignment faculty by the LESSEE, without
prejudice of the LESSOR satisfaction on the physical state and preservation of
the leased property.
NINETEENTH: The
no compliance of any of the clauses of this contract, shall authorize any of the
parties to consider this contract terminated and dismissed, with no need of
further or previous demand or to prove any prejudice, having the LESSEE to
restitute the PROPERTY within 30 (thirty) days after the notification of the
respective resolution, having the LESSOR, if applicable, to return the monies
perceived for anticipated rent and not used periods of time. At the
LESSOR will, they shall be considered as a default by the LESSEE and, therefore,
cause for early termination of the lease, prior consultation and notification to
the LESSE for it to try solving such contingencies in a reasonable term, the
following situations: reorganization proceedings, bankruptcy,
bank checking account closeout by the Banco Central de la República
Argentina, seizure on existing assets in the PROPERTY in trails submitted
against the LESSEE, closure due to tax or provisional fine, judicial
intervention, and any other assumptions that could cause the LESSOR a reasonable
fear about the aforementioned compliance with the assumed obligations by the
LESSEE.
TWENTIETH:
In the case of contract expiration or rescission agreement and the no compliance
by the LESSEE with the obligation to restitute the PROPERTY on time, a penalty
clause shall be accrued equivalent to a monthly rent. In the case the
LESSEE resist to the obligation to restitute the PROPERTY on time or if it
ceases paying the rent and/or services, expenses or taxes assigned to the
LESSEE, the LESSOR shall be able to request such suspension of all kind of
services commonly provided to the LESSEE.
TWENTY
FIRST: For any possible judicial intervention the undersigned of this
contract submit to the jurisdiction, of the Civil Lower Courts of this Federal
Capital, expressly waiving to any other venue or jurisdiction that could
correspond to them. The parties establish the following addresses for
service: LESSOR: Ave. Santa Fe 1611, piso 4º Capital Federal. LESSEE:
Corrientes 1386 piso 13 Cap. Federal.
TWENTY
SECOND: In the case that the LESSOR does not notify the LESSEE or does
not xxx for the delay in rent payments, should not be construed as extension of
the term, or extinguish the bond and all judicial expenses, fees and/or of any
nature, arising from the no compliance of the obligations of this contract, all
such expenses should be exclusively charged to the LESSEE.
TWENTY
THIRD: In the case of dissolution or liquidation of the LESSEE this lease
contract shall have no effect; applying the terms of Law 23.091, art. 8, on
early termination.-
TWENTY
FOURTH: The lack of compliance of any of the clauses of this contract,
shall enable the parties to terminate it, if it is not convenient for them,
having the LESSEE to move out of the property in the peremptory term stated by
the LESSOR and having the LESSOR, if applicable, to restitute any received rent
prepayment, reserving both parties the right to claim for any damage along with
the penalties established herein.-
TWENTY
FIFTH: The relationship between the parties, this contract, its effects,
etc. are exclusively governed by the dispositions of the Civil Code with express
exclusion of any emergency regime that could be sanctioned or
adopted in the future to regulate the lease of urban real
estate.-
TWENTY
SIXTH: In this act, the LESSEE party, in performance bond of this
contract, and without prejudice of the obligation to respond with all its
patrimony, undertakes to the payment as a deposit, the amount of ELEVEN THOUSAND FIVE HUNDRED PESOS
($11,500.-) to the LESSOR, amount that shall not accrue interests or been
applied for rent payment. Once the lease have finished and the
PROPERTY is returned in the same conditions it was received, except for the
wearing effects of time and being paid all services and accepted by the LESSOR,
the devolution of such deposit shall be done in the same currency after the
pertinent deductions, if any.- The deposit should be updated any
time the rent amount is modified, as per stipulations of clause
29.
TWENTY
SEVENTH: The LESSOR shall collaborate with the LESSEE in the processing
of the corresponding authorizations, as well as the ones for electricity, water
or gas but being them the total LESSEE responsibility, relieving from their
processing in whole to the LESSOR. Likewise, the LESSOR shall be in
charge to provide all documentation corresponding to the property to obtain the
corresponding municipal authorization, process that shall be done by the
LESSEE. If, hypothetically, the municipal authorization cannot be
resolved with full rights, it shall be resolved in good standing without the
need of any demand and without any of the parties being able to make an
economical claim to the other party or demand damages under no cause or
concept. In this case the LESSOR should return to the
LESSEE the rent paid by concept of deposit and the checks or monies
corresponding to the rent amounts paid in advance, as per clause eight herein,
except for the rent for the periods of time when the LESSEE used the
PROPERTY.
TWENTY
EIGHTH: LAKELAND INDUSTRIES INC’s signature GUARANTEES the faithful
compliance of this contract, who submit in this act a check on Wachovia Bank NA
New York USA for TEN THOUSAND US DOLARS (US$10,000.-) which is submitted as
bond, and that the guarantor authorizes its collection by the LESSOR in the case
of the lack of compliance by the LESSEE with the payment of rent and expenses,
authorizing it to receive and to charge from such amounts in such concepts,
having, as a sole prevention, to notify within 5 (five) days in advance of such
deposit to the LESSEE instigating the payment of the owned items, for it to
normalize the defaults, being authorized to collect the amount in case of
silence or the lack of payment. This facility shall have a validity
of six month from the signature date, date in which the LESSEE should submit a
bond reinsured for the remaining term of the contract which guarantees the
payment of the rent, to the LESSOR satisfaction. The lack of
compliance with this clause is automatic cause for termination by the
LESSOR.
TWENTY
NINTH: By virtue to formalize this contract in a context of economic
emergency, in which it is impossible to establish an economic correction guide,
both parties agrees to establish an adjustment criterion every six months to
adequate the rent to the local values as per the real estate market situation at
that time, undertaking to assume its best efforts to equally ensure the
resulting modifications. In that way the parties shall meet 15 days
before the ending of every six month period. If the agreement is not
reached, both parties shall accept as the rental value the written appraisal
average made by three local real estate agencies for each party, with experience
in commercial rental, being that resulting value the new rental value for next
year. In the case the LESSEE does not accept the new rental value, it
shall be able to terminate the contract with a 60 days’ advance notification
paying the indemnity amount provided for in Law 23.091 in accordance to the move
out date, being the value of the rent during that period of time the last
immediate paid in accordance with the parties.
THIRTIETH:
STAMP
TAX. For purposes of stamp tax, the value of this contract is
estimated in the amount of $414.000, so the corresponding tax to the rate of
0.6% amounts to $2.484, which shall be paid by the Parties in a 50%
each.
THIRTY
FIRST: By virtue that the LESSEE does not have a bank account and it is
in the process of getting one, it shall be able to pay, in a transitory way, the
monthly rent from the sign of this contract by a maximum period of time of 6
(six) month, the rent in a monthly way, from day one to day five of each month
in the property administration of the LESSOR. Once the bank account
and the check book are obtained, it should issue the checks every six months as
mentioned above. In this vein the first month is paid by wire
transfer, so once it is credited and after the corresponding national currency
exchange control is done the items for the rent of September, August
proportional and deposit shall be cancelled. It is specified that
until such amounts are credited the LESSEE shall not be able to take possession
of the leased property.
THIRTY
SECOND: The property has an electric lift truck, which connects the lobby
with the first floor, with a maximum load capacity of 500 kg. It is
expressly agreed by both parties that such lift truck is not to take up, take down
or transport persons in any way, therefore the LESSOR is relieved of all
responsibility for accidents on persons or third parties when they were
transported in violation of this convention. Likewise, the LESSEE has
been truly instructed on the operation of the lift truck, for third party
persons and goods, having the LESSEE to contract an insurance for such lift
truck that covers its risks relieving the LESSOR from all responsibility in that
respect.
In
witness whereof, reading and confirmation, this agreement is signed in two
counterparts, in Buenos Aires on August 19, 2009.
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By:
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/s/ Xxxxxxxx Xxxxxxx Xxxx
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By:
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/s/ Xxxxx
Xxxxxxxx
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Lessee
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Lessor
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