Exhibit 10.12
LICENSE
AGREEMENT
THIS LICENSE
AGREEMENT (this “ Agreement ”) is made this 24th
day of February, 2006, by and between Litton Systems, Inc., a
Delaware corporation (hereinafter referred to as “
Licensor ”), Simclar, Inc., a Delaware corporation,
and Simclar Interconnect Technologies Inc., a Delaware corporation
(hereinafter collectively referred to as “ Licensee
”).
RECITALS
WHEREAS,
Licensor, Simclar Inc., and certain other parties are parties to
that certain Share and Asset Purchase and Sale Agreement dated as
of December 21, 2005 (the “ Purchase Agreement
”).
WHEREAS,
Licensor and Licensee desire to enter into this Agreement in
connection with the consummation of the transactions specified in
the Purchase Agreement.
NOW, THEREFORE,
in consideration of the mutual covenants set forth in this
Agreement, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Licensor and
Licensee hereby agree as follows:
SECTION 1. LICENSED PREMISES; USE; NO
OFF-SET .
1.1
Licensor hereby licenses unto
Licensee, and Licensee hereby licenses from Licensor, the premises
consisting of that portion of the improvements located at 4811 W.
Kearney, Springfield, Missouri, described in Exhibit A
attached hereto and incorporated herein (“ Licensed
Premises ”) and access to the common areas shared by
Licensor and Licensee (“Common Areas”).
1.2
The Licensed Premises may be used
and occupied for the operation of the Interconnect Technologies
Assembly Business and Assets acquired by the Licensee, at the
Licensed Premises that is consistent with the business practices of
the Licensor at the Licensed Premises immediately prior to the date
hereof (the “ Business ”) and for no other
purpose unless Licensor provides prior written consent.
1.3
There shall be no abatement,
off-set, diminution or reduction of License Fee payable by Licensee
hereunder or of the other obligations of Licensee hereunder under
any circumstance.
SECTION 2. TERM
.
2.1 The term (“ Term ”) of this
License shall commence on the date of this License (“
Commencement Date” ), and shall end on the earlier to
occur of (i) midnight on the 30 th day following written
notice from Licensee of the termination hereof, or (ii) at midnight
twelve months after the Commencement Date.
2.2 Licensee shall not have the right to renew or
extend the Term of this License.
SECTION 3. LICENSE FEE
.
3.1
During the Term, Licensee shall pay
to Licensor monthly fixed license fee of seventy thousand dollars
($70,000) (“Fixed License Fee” or “License
Fee”) payable on the first date of the Term and on the
monthly anniversary thereafter. The License Fee includes
Licensee’s allocable share of the costs for taxes, utilities,
insurances, and other building carrying costs.
3.2
Intentionally Omitted.
3.3
All payments of License Fee (unless
otherwise specified in this License) shall be made to Licensor
at:
c/o Northrop
Grumman Systems Corporation
1745 W. Nursery
Road
M/S
A465
Linthicum, MD
21090
Attn: Real
Estate Manager
or such other
place as Licensor may specify, from time to time, by written notice
delivered to Licensee in accordance with Section 18.
SECTION 4. INTENTIONALLY
OMITTED .
SECTION 5. CONDITION;
MAINTENANCE .
5.1
Except as otherwise expressly set
forth in this License, and without limiting any rights Licensee may
have under the Purchase Agreement, no representations, statements,
covenants or warranties, express or implied, have been made by or
on behalf of Licensor in respect of the Licensed Premises, the
status of title thereof, the physical condition thereof, the Laws
applicable thereto, taxes or assessments, or the use that may be
made of the Licensed Premises.
5.2
Licensor covenants and agrees, at
its expense to keep, maintain and replace, if necessary, the
foundations, the exterior paint, the plumbing system, the
electrical system, septic systems or fields and drainage, the
utility lines and connections to the Licensed Premises, the
sprinkler mains, if any, and all structural elements and mechanical
systems of all improvements located on the Licensed Premises,
including, without limitation, the roof (and all interior elements
if damaged by leakage), load-bearing and masonry walls and floor
slabs, in a safe condition and otherwise in substantially the same
condition as the Licensed Premises existed on the Commencement
Date. Furthermore, Licensor shall make all material repairs to any
HVAC systems located on the Licensed Premises. Licensee shall
promptly advise Licensor in writing of any maintenance or repairs
to the Licensed Premises that it determines to be necessary or
advisable.
5.3
Licensor shall, at its cost and
expense, (i) remove all accumulated snow, ice and debris from the
Licensed Premises, (ii) perform and/or provide all cleaning,
striping, paving, landscaping, lighting and security services with
respect to the Licensed Premises, (iii) perform all preventative
maintenance that would customarily be performed on all building and
other property systems located on or in the Licensed Premises and
(iv) maintain and repair all signage located in or on the Licensed
Premises, in each case, so as to maintain the Licensed Premises, at
all times during the Term, in a safe condition and otherwise in
substantially the same condition that it exists on the Commencement
Date.
5.4
Occupant shall, at its sole cost
and expense, keep and maintain all interior spaces in the Licensed
Premises to the extent not covered by the maintenance and repair
obligations of Licensor under this Section 5, and shall keep and
maintain all fixtures and mechanical equipment used by Occupant, in
good order, condition, and repair.
SECTION 6. INSURANCE
.
6.1
Licensee agrees to carry, at
Licensee’s own cost and expense, during the term hereof,
Commercial General Liability insurance on the Licensed Premises,
naming Licensor as an additional insured providing coverage of not
less than $5,000,000 Each Occurrence Limit, $100,000 Fire Damage
Limit, $10,000 Medical Expense Limit, $1,000,000 Personal and
Advertising Injury Limit, $10,000,000 General Aggregate Limit, and
$2,000,000 Products-Completed Operations Aggregate Limit. The
insurance required under this Section 6.1 may, at Licensee’s
option, be effected by umbrella policies issued to Licensee that
otherwise comply with the terms and conditions of this Section
6.
6.2
Licensor agrees to carry, at
Licensor’s own cost and expense during the Term hereof, all
risk property insurance covering fire and extended coverage,
vandalism and malicious mischief, sprinkler leakage and all other
perils of direct physical loss or damage insuring all buildings,
improvements and betterments located at the Licensed Premises, and
all appurtenances thereto (excluding Licensee’s Property) for
the full replacement value thereof. Licensee shall not be named as
an insured under, or have any right, title or interest in the
proceeds of, such policy(ies).
6.3
Licensee agrees to carry, at
Licensee’s sole cost and expense, during the term hereof, all
risk property insurance covering fire and extended coverage,
vandalism and malicious, mischief, sprinkler leakage and all other
perils of direct physical loss or damage insuring Licensee’s
Property for the full replacement value thereof. Licensor agrees
that it shall not have any right, title or interest in and to
Licensee’s property insurance covering Licensee’s
Property located on or within the Licensed Premises or any proceeds
there from.
6.4
Licensor and Licensee and all
parties claiming under them, mutually release and discharge each
other from all claims and liabilities arising from or caused by any
casualty or hazard to the extent covered by such party’s
insurance, and waive any right of subrogation which might otherwise
exist in or accrue to any person on account thereof. This release,
discharge and waiver shall not be effective to the extent the same
violates such party’s insurance policy(ies) or if the such
party’s insurance carrier charges an additional premium in
order to provide such waiver and the party benefiting from the
waiver does not agree to pay the additional premium.
6.5
Licensor and Licensee each shall
ensure that any contractors performing work on the Licensed
Premises on behalf of such party shall maintain Commercial General
Liability insurance in an amount with a combined single limit of
One Million Dollars ($1,000,000.00), with a reasonable deductible,
for the benefit of Licensor and Licensee.
6.6
Upon written request of either
party, the other party shall furnish the requesting party with
certificates of the insurance which such party is required to carry
under this Section. Such certificates shall provide that the
insurer give the certificate holder at least thirty (30) days prior
written notice of any cancellation or material amendment of the
policy in question.
SECTION 7. INDEMNIFICATION
.
7.1
Subject to the limitations set
forth below, Licensee hereby indemnifies and holds Licensor and its
officers, directors, stockholders, employees, affiliates and
contractors harmless from and against any and all losses, claims,
demands, liabilities, damages fines, costs and expenses (including
reasonable attorneys’ fees and expenses) arising from
Licensee’s use of the Licensed Premises whether during or
after the Term or from any act permitted, or any omission to act,
in or about the Licensed Premises by Licensee or its agents,
employees or contractors during the term or from any breach or
default by Licensee of this Agreement, or any accident, injury or
damage occurring in, at or upon the Licensed Premises, except, in
each case, to the extent any such claims, demands, liabilities or
expenses are caused by Licensor’s negligence or willful
misconduct. In the event any action or proceeding shall be brought
against Licensor by reason of any such claim, demand, liability or
expense. Licensee shall defend the same at Licensee’s expense
by counsel selected by the insurance company (if covered by
insurance) and otherwise by counsel reasonably satisfactory to
Licensor. Notwithstanding the foregoing, nothing in this Agreement
shall be construed to obligate Licensee to indemnify Licensor for
such matters as Licensor has agreed to provide indemnification
pursuant to the Purchase Agreement.
7.2 Licensee shall indemnify, defend and hold
harmless Licensor against any fines, penalties, suits, claims,
actions and costs (including, but not limited to, attorney’s
fees and investigation or remediation costs) arising out of or in
any way connected with any disposal, spill, discharge or release of
Hazardous Materials, any violation, noncompliance or upset event
(including, but not limited to, an exceedance of applicable
wastewater discharge limits) or any act or omission by Licensee at
any time during or as a result of Licensee’s use or occupancy
of or operations at the Licensed Premises. For instance, Licensee
shall indemnify, defend and hold harmless Licensor to the extent
Licensee’s acts or omissions adversely impact or result in an
increase in costs or remediation activities (including but not
limited to in the event that Licensee causes a spill or release,
Licensee communicates unilaterally with governmental authorities
which triggers additional remediation activities, Licensee
discharges wastewater to the wastewater treatment system that
results in an exceedance of the wastewater discharge permit
limits).
7.3 Licensor hereby indemnifies and holds Licensee
and its officers, directors, stockholders, employees, affiliates
and contractors harmless from and against any and all losses,
claims, demands, liabilities, damages, fines, costs and expenses
(including reasonable attorneys’ fees and expenses) arising
from a breach or default by Licensor of its obligations hereunder
or by reason of any negligence or wrongful act committed by
Licensor or its agents, employees or contractors when any one of
them has entered upon the Licensed Premises in accordance with the
terms of this Agreement, except to the extent any such claims,
demands, liabilities or expenses are caused by Licensee’s
negligence or willful misconduct. Licensor shall indemnify, defend
and hold harmless Occupant against any fines, penalties, suits,
claims, actions and costs (including, but not limited to,
attorney's fees and investigation or remediation costs) arising out
of or in any way connected with any disposal, spill, discharge or
release of Hazardous Substances, any violation, noncompliance or
upset event (including, but not limited to, an exceedance of
applicable wastewater discharge limits) or any act or omission by
Licensor at any time during or as a result of Licensor's use or
occupancy of or operations at the facility of which the Licensed
Premises are a part. In the event any action or proceeding shall be
brought against Licensee by reason of any such claim, demand,
liability or expense, Licensor shall defend the same at
Licensor’s expense by counsel selected by the insurance
company (if covered by insurance) and otherwise by counsel
reasonably satisfactory to Licensee. Notwithstanding the foregoing,
nothing in this Agreement shall be construed to obligate Licensor
to indemnify Licensee for such matters as Licensee has agreed to
provide indemnification pursuant to the Purchase
Agreement.
7.4 The foregoing provisions of this Section 7 are
not intended to limit the rights of the parties under the Purchase
Agreement, but shall be without double counting.
7.5 The provisions of this Section 7 shall survive
the expiration or earlier termination of this Agreement.
SECTION 8. ASSIGNMENT AND
SUBLETTING .
8.1
Licensee shall not have the right
to sublet, assign or otherwise transfer its interest in this
Agreement.
SECTION 9. REPAIR AFTER
CASUALTY .
In the event
the Licensed Premises is hereafter materially damaged or destroyed
or rendered fully or partially unlicenseable for its accustomed
use, by fire or other casualty, then this Agreement shall
immediately terminate.
SECTION 10. EVENTS OF
DEFAULT .
Any of the
following shall be deemed an event of default by
Licensee:
(a) Any failure by Licensee to pay the License Fee
or make any other payment required to be made by Licensee hereunder
within thirty (30) days after receipt of written notice from the
Licensor; and
(b) A failure by Licensee to observe and perform
any other provision of this Agreement to be observed or performed
by the Licensee, where such failure continues for forty-five (45)
days after written notice thereof by Licensor to Licensee, except
that this forty-five (45) day period shall be extended for a
reasonable period of time if such failure is not reasonably capable
of cure within said forty-five (45) day period and Licensee
proceeds to cure such default within such period; and
(c) If Licensee shall file a voluntary petition for
relief under the United States bankruptcy code or if such petition
is filed against it and an order for relief is entered, or if
Licensee shall file any petition or answer seeking consenting to or
acquiescing in any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under the
present or any future United States bankruptcy code or any other
present or future applicable federal, state or other statute or
law, or shall seek or consent to or acquiesce in or suffer the
appointment of any trustee, receiver, custodian, signee,
sequestrator, liquidator or other similar official of Licensee, or
of all or any substantial part of its properties or of the Licensed
Premises or any interest therein of Licensee; and
(d) If within ninety (90) days after the
commencement of any proceeding against Licensee seeking any
reorganization, arrangement, composition, readjustment liquidation,
dissolution or similar relief under the present or any future
United States bankruptcy code or any other present or future
applicable United States, state or other statute or law, such
proceeding shall not have been dismissed; or if, within ninety (90)
days after the appointment, without the consent or acquiescence of
Licensee, of any trustee, receiver, custodian, assignee,
sequestrator, liquidator or other similar official of Licensee or
of all or any substantial part of its properties or of the Licensed
Premises or any interest therein of Licensee, such appointment
shall not have been vacated or stayed on appeal or otherwise, or
if, within thirty (30) days after the expiration of any such stay,
such appointment, shall not have been vacated.
SECTION 11. LICENSOR’S
REMEDIES .
In the case of
an event of default by Licensee hereunder (as defined in Section 10
above), Licensor shall have the right, at Licensor’s option,
without further notice or demand of any kind to exercise any rights
or remedies it may have at law or equity.
SECTION 12. LICENSOR’S
DEFAULT .
If Licensor
should default in the performance of any of its obligations under
this Agreement for a period of more than thirty (30) days after
receipt of written notice from Licensee specifying such default, or
if such default is of a nature to require more than thirty (30)
days to remedy and continues beyond the time reasonably necessary
to cure such default (or Licensor has not undertaken procedures to
cure such default within such thirty (30) day period or thereafter
diligently pursued such procedures, subject to force majeure),
Licensee may, in addition to any other remedy available at law or
in equity, terminate this Agreement upon ninety (90) days notice
(but without any right to damages as a result thereof) . Licensee
agrees that nothing in this Agreement and no breach of this
Agreement shall modify or limit any party’s obligations to
make any payments that are required to be made pursuant to the
Purchase Agreement.
SECTION 13. NO WAIVER OF
DEFAULT .
No waiver by
either party of any of the duties, obligations, covenants or
conditions required to be performed by the other party under this
Agreement and no waiver of any legal or equitable relief or remedy
shall be implied by the failure of either party to
assert
