Exhibit 10.3
PROPERTIES SERVICE AGREEMENT
THIS PROPERTIES SERVICES AGREEMENT (this "Agreement") is made and
entered into as of this 14th day of December, 2001, by and between JI
Properties, Inc., a Delaware corporation ("JI Properties"), and each of the
other parties a signatory hereto (hereinafter collectively referred to as
the "Company").
WHEREAS, the Company wishes to obtain the use of certain real
estate, asset and transportation assets owned or leased by JI Properties
and to obtain related services of JI Properties' personnel or personnel to
which JI Properties has access; and
WHEREAS, JI Properties desires to provide or cause to be provided
those assets and services requested by the Company under such terms and
conditions.
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements set forth herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, the parties hereto
agree as follows:
Section 1. Assets and Services.
1.1. Assets. JI Properties hereby grants to the Company the
rights to use the Assets set forth on Exhibit A.
1.2. Services to be Rendered. JI Properties shall make
available the services of its personnel or personnel to which it has access
to provide such services in connection with the use of the Assets as are
necessary for the use and/or operation of such Assets (the "Services").
1.3. Charges. The charges to the Company for the use of
Assets and Services shall consist of an amount equal to the sum of (i) the
costs actually incurred in the use and/or operation of the Assets used or
operated by the Company (including the costs of the related Services as
determined by JI Properties) and (ii) a portion of the costs associated
with owning such assets which are not directly attributable to the
operation or use of such assets equal in amount to such costs multiplied by
a fraction, the numerator of which is equal to the Company's net revenues
and the denominator of which is the sum of the net revenues of all entities
which have entered into agreements with JI Properties similar to this
Agreement.
1.4. Performance of Services. JI Properties covenants that
it will perform or cause to be performed the Services in a timely,
efficient and workmanlike manner and in substantially the same manner in
which JI Properties (or its predecessor) is providing such services to the
Company currently. JI Properties further covenants that it will maintain or
contract for a sufficient staff of trained personnel to enable it to
perform the Services hereunder. JI Properties may retain third parties or
its affiliates to provide certain of the Services hereunder. Any
arrangements between JI Properties and its affiliates for the provision of
Services hereunder shall be commercially reasonable and on terms not less
favorable than those which could be obtained from unaffiliated third
parties.
1.5. Payment for Facilities and Services. JI Properties shall
xxxx the Company, at the end of each calendar month for the applicable
charges, or on such other periodic basis a determined by JI Properties.
Such amount shall be payable by the Company in full within 30 days of
receipt thereof by the Company.
1.6. Reimbursement. The Company shall reimburse JI Properties
for all reasonable third party out-of-pocket expenses it incurs on behalf
of the Company not billed directly to the Company within 30 days of receipt
of the invoice therefor, if not included in the charges pursuant to Section
1.3.
Section 2. Term. The term of this Agreement shall commence the
date hereof and continue until December 31, 2011, unless extended, or
sooner terminated, as provided below. This Agreement shall be automatically
renewed for successive one-year terms starting December 31, 2011 unless
either party hereto, within sixty (60) days prior to the scheduled renewal
date, notifies the other party as to its election to terminate this
Agreement. Notwithstanding the foregoing, this Agreement may be terminated
by not less than ninety (90) days' prior written notice from the Company to
JI Properties at any time after (a) substantially all of the stock or
substantially all of the assets of the Company or all of its subsidiaries
are sold to an entity unaffiliated with JI Properties and/or a majority of
the Company stockholders immediately prior to the sale or (b) the Company
is merged or consolidated into another entity unaffiliated with JI
Properties and/or a majority of the Company's stockholders immediately
prior to such merger and the Company is not the survivor of such
transaction. Subject to the foregoing, the Agreement will not be terminated
as a result of any subsidiary of the Company ceasing to be a subsidiary of
the Company for financial reporting or other purposes.
Section 3. Audit of Services. At any time during regular
business hours and as often as reasonably requested by the Company's
officers, JI Properties shall permit the Company or its authorized
representatives to examine and make copies and abstracts from the records
and books of JI Properties for the purpose of auditing the performance of,
and the charges of, JI Properties under the terms of this Agreement;
provided, that all costs and expenses of such inspection shall be borne by
the Company.
Section 4. Prevention of Performance. JI Properties shall not be
determined to be in violation of this Agreement if it is prevented from
performing any Services hereunder for any reason beyond its reasonable
control, including without limitation, acts of God, nature, or of public
enemy, strikes, or limitations of law, regulations or rules of the Federal
or of any state or local government or of any agency thereof.
Section 5. Indemnification.
5.1. By the Company. The Company shall indemnify, defend and
hold JI Properties, and its directors, officers, and employees harmless
from and against all damages, losses and reasonable out-of-pocket expenses
(including fees) incurred by them in the course of performing the duties on
behalf of the Company and its subsidiaries as prescribed hereby.
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5.2. Remedy. JI Properties does not assume any
responsibility under this Agreement other than to render the services
called for under this Agreement in good faith and in a manner reasonably
believed to be in the best interests of the Company. The Company's sole
remedy on account of the failure of JI Properties to provide the Assets
render the Services as and when required hereunder shall be to procure such
assets or services elsewhere.
Section 6. Additional Subsidiaries. If at any time after the
date which this Agreement is executed, the Company acquires to creates one
or more subsidiary corporation (a "Subsequent Subsidiary"), the Company
shall cause such Subsequent Subsidiary to be subject to this Agreement and
all references herein to the Company's "direct and indirect subsidiaries"
shall be interpreted to include all Subsequent Subsidiaries.
Section 7. Payments Not Subject to Set-Off. Any payments paid by
the Company under this Agreement shall not be subject to set-off and shall
be increased by the amount, if any, of any taxes (other than income taxes)
or other governmental charges levied in respect of such payments, so that
JI Properties is made whole for such taxes or charges.
Section 8. Notices.
8.1. Manner of Delivery. Each notice, demand, request,
consent, report, approval or communication (each a "Notice") which is or
may be required to be given by either party to the other party in
connection with this Agreement and the transactions contemplated hereby,
shall be in writing, and given by telecopy, personal delivery, receipted
delivery service, or by certified mail, return receipt requested, prepaid
and properly addressed to the party to be served.
8.2. Addresses. Notices shall be addressed as follows:
If to the Company:
_________________________________
ArborLake Centre
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Xx.
If to JI Properties:
JI Properties, Inc.
ArborLake Centre
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Xx.
8.3. Effective Date. Notices shall be effective on the date
sent via telecopy, the date delivered personally or by receipted delivery
service, or three (3) days after the date mailed.
8.4. Change of Address. Each party may designate by notice
to the others in writing, given in the foregoing manner, a new address to
which any notice may thereafter be so given, served or sent.
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Section 9. Independent Contractor. JI Properties and its
personnel shall, for purposes of this Agreement, be independent contractors
with respect to the Company.
Section 10. Entire Agreement. This Agreement sets forth the
entire understanding of the Company and JI Properties, and supersedes all
prior agreements, arrangements and communications, whether oral or written,
with respect to the subject matter hereof. No supplement, modification,
termination in whole or in part, or waiver of this Agreement shall be
binding unless executed in writing by the party to be bound thereby. No
waiver by either party of any breach of any provision of this Agreement
shall be deemed a continuing waiver or a waiver of any preceding or
succeeding breach of such provision or of any other provision herein
contained.
Section 11. Assignability; Binding Effect. This Agreement may be
assigned by either party hereto without the consent of the other party,
provided, however, such assignment shall not relieve such party from its
obligations hereunder. Any assignment of this Agreement shall be binding
upon and inure to the benefit of the parties and their respective
successors and assigns. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto, each of their respective
successors and permitted assigns, and no other persons shall have or derive
any right, benefit or obligation hereunder.
Section 12. Headings. The headings and titles of the various
paragraphs of this Agreement are inserted merely for the purpose of
convenience, and do not expressly or by implication limit, define, extend
or affect the meaning or interpretation of this Agreement or the specific
terms or text of the paragraph so designated.
Section 13. Governing Law. This Agreement shall be governed by
the internal laws (and not the law of conflicts) of the State of Delaware.
Section 14. Severability. In the event that any provision of
this Agreement shall be held to be void or uneforceable in whole or in
part, the remaining provisions of this Agreement and the remaining portion
of any provision held void or uneforceable in part shall continue in full
force and effect.
Section 15. Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original, but all of
which taken together shall be considered one and the same instrument.
(SIGNATURE PAGE FOLLOWS)
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
JI PROPERTIES, INC.
By:
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Name: Xxxxxx X. Xxxxxx, Xx.
Title: Senior Vice President
MOTORS AND GEARS HOLDINGS, INC.
KINETEK, INC.
KINETEK INDUSTRIES, INC.
FIR GROUP HOLDINGS, INC.
FIR GROUP HOLDINGS ITALIA, S.R.L. (ITALIAN LLC)
CONSTRUGIONI ITALIANE MOTORI ELETTRICI, S.P.A.
(ITALIAN CORPORATION)
SELINSISTEMI, S.P.A. (ITALIAN CORPORATION)
FIR ELECTROMECCANICA, S.P.A. (ITALIAN CORPORATION)
T.E.A. TECHNOLOGIE ELECTROMECCANICHE ED AUTOMAZIONE,
S.R.L. (ITALIAN LLC)
MOTION HOLDINGS, INC.
MOTION CONTROL ENGINEERING, INC.
XXXXXX-XXXXX INDUSTRIES, INC.
XXXXXX-XXXXX DE MEXICO S.A. DE C.V
THE IMPERIAL ELECTRIC COMPANY
GEAR RESEARCH, INC.
ADVANCED D.C. HOLDINGS, INC.
ADVANCED D.C. MOTORS, INC.
SERMED S.A.R.L.
ADVANCED D.C. MOTORS GMBH
ELECTRIC VEHICLE COMPONENTS LTD.
ELECTRICAL DESIGN AND CONTROL COMPANY
By:
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Name: Xxxxxx X. Xxxxxx, Xx.
Title: Vice President
