Exhibit 10.35
 
COLLECTIVE BARGAINING AGREEMENT NEXUS MAGNETICOS MEXICO S. DE R.L. DE C.V

COLLECTIVE BARGAINING AGREEMENT SIGNED BY AND BETWEEN NEXUS MAGNETICOS DE
MEXICO, S. DE R.L. DE C.V. AND SINDICATO INDUSTRIAL AUTONOMO DE OPERARIOS EN
GENERAL DE MAQUILADORAS DE REYNOSA, C.T.M. (UNION OF INDEPENDENT INDUSTRIAL
OPERATORS IN REYNOSA MAQUILADORAS, C.T.M.)

CLAUSES
ONE: Collective Bargaining Agreement celebrated by and between NEXUS MAGNETICOS
DE MEXICO, S. de R.L de C.V represented by LYNN STEVENS as legal representative
and the SINDICATO INDUSTRIAL AUTONOMO DE OPERARIOS EN GENERAL DE MAQUILADORAS DE
REYNOSA, C.T.M., , represented by Mr. HUGO EDUARDO MARTINEZ LARA,  SECRETARY
GENERAL, and C. JOSE LUIS RODRIGUEZ ALEMAN, SECRETARY OF LABOR, respectively.

TWO: The union declares itself to be legally constituted in accordance with the
laws governing the country and duly incorporated in the registry, issued by the
Local Board of Conciliation and Arbitration of the State of Tamaulipas and
represented by its Executive Committee and commissions that comprise it. The
company declares itself to be a company incorporated under the laws of the
country and is located in Reynosa Industrial Park.

THREE: Both parties agree to be simply called "THE COMPANY" and "THE UNION"
References to the FEDERAL LABOR LAW shall simply be [the] LAW.  The"$" symbol
indicates Mexican pesos.

FOUR: The Union’s representative to the Company shall be the Secretary General,
and the Company’s representative to the Union shall be its General Manager.

FIVE: The Company has the exclusive right to manage its business, and therefore,
neither the employees nor the union or its representatives shall in any way
interfere [with its business].
 
 
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SIX: The Union guarantees the competency and morality of its members, in
accordance with the provisions of Section I of Article 47 of the Law.

SEVEN: The current Collective Bargaining Agreement shall apply only to members
of the contracting workers union. It shall not apply to upper level staff
working in management, accounting, \inspection, supervisory roles, training,
education and security for the Company. The Company reserves the right change
these categories based on its needs.

EIGHT: Any employee for the Company is required to:
1. The employee, with the exception of upper level staff, must join the Union.
2. Be at least seventeen years old and pass the medical, cultural and technical
tests required by the Company.
3. Present a certificate of having completed primary school, at minimum.
4. Not have been previously terminated from employment with the Company for
disciplinary reasons, insubordination, disobedience, having committed a serious
offense, or any other cause.
5. Comply with Section X of Article 134 of the Federal Labor Law.

NINE: If a worker becomes a member of upper level staff he automatically ceases
to be a union member.

TEN: The Company shall have the right to select and employ its own staff through
its own selection system. The Company agrees to verify that all employees
selected are eligible for membership in the Union. It will ask any new employees
for appropriate documentation and applications, which will be submitted within
five days of hiring the employee.

ELEVEN: The Union shall have the power to take disciplinary action against its
members provided that this does not prejudice the interests of the company or
its production capacity. In the same manner, the company may impose penalties on
employees for just cause, in accordance with Internal Labor Regulations. It may
suspend employees without pay for up to 8 days, or terminate their employment
under [article] 47 of the Law.
 
 
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TWELVE: The Company is obligated to support any disciplinary action that the
union takes against one of its members. Other than written notification, the
Union is not obligated to provide the Company with any reason or justification
for decisions or actions taken.

THIRTEEN: Under this Collective Bargaining Agreement, the Company and the Union
agree to the possibility of temporary contracts for a specific job or period,
after which, the Company shall terminate the employment relationship with the
employee without any other responsibility.

FOURTEEN: Workers are expressly obligated to knowledgeably and carefully perform
all those tasks delegated to them and to strictly comply with any instructions,
orders and indications they receive regarding the way they should perform their
work; specifically technical instructions for manufacturing products and the
performance of applicable industrial operations. In addition employees agree to
strictly comply with supervisor instructions or those of their superiors
regarding operation and maintenance of machinery, so that at the end of the day,
the work area and machinery are perfectly clean. The workers must perform their
duties during the workday with the intensity and the care required by the
Company.

FIFTEEN: The Company may, change any employee from his regular position to
another position, where their services are needed, without affecting the
employee’s salary. Said changes must be made during current or future expansions
and must take place within the perimeter of the current plant.
 
SIXTEEN: The Company and its representatives will refrain from giving workers a
hard time verbally or physically and will treat workers with due respect and
consideration. In the same fashion, workers will show the same respect and
obedience to the Company and its representatives.
 
 
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SEVENTEEN: The Company and the Union agree that employees will perform their
duties and will be trained at the Company or any other place in Mexico or the
United States, as required by the Company in accordance with the provisions
Article 28 of the Law.

EIGHTEEN: The purpose of this contract is to set forth the mutual obligations
which shall apply to all areas of the company at its plant in Reynosa,
Tamaulipas. The Company may grant any work that is required to third parties or
contractors. This Collective Bargaining Agreement shall not apply to said third
parties or contractors.

NINETEEN: The workers covered by this Agreement shall work their shift in
accordance with the terms of Articles 58 and 68 of the Federal Labor Law. The
workers shall work overtime with prior written authorization issued by the
Company or its representatives, and are permitted to work those overtime hours
per week as set forth by Law. In said cases the employees shall be paid in
accordance with the provisions of the aforementioned articles.

TWENTY: The work week is 48 hours and the Company shall be free to change it
using special shifts, as needed, in order to achieve production targets. The
Company may establish working hours in six (6) shifts of 8 hours per day and/or
five (5) shifts of 9.5 hours per day. The Company shall give employees
sufficient time for meals; said break shall be no less than thirty minutes,
which will not be considered as time worked during the business day

TWENTY-ONE: If the company requires employees to work during days off or
holidays, the Company agrees to pay double time in accordance with the
provisions of Article 73 of the Federal Labor Law.  The Company shall notify the
staff that will be required to work on days off, using the announcement boards
and specifying the names of those employees required to report to work as if it
were a regular workday.

For those departments where only some of the staff is required, employees shall
be notified individually by their respective immediate supervisor, who will
obtain the signature of each worker notified. Pursuant to the second paragraph
of Article 75 of the Law, workers are required to serve on the shifts indicated
by the Company and the company agrees to pay their respective salaries as set
forth in the beginning of this article.
 
 
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TWENTY-TWO: The Company is obligated to give workers one day off per week, with
full pay. When the employee has not worked a full week, said payment shall be
proportional to the services provided. Employees who work on Sunday shall be
entitled to a 25% increase over their wage rates in accordance with the
provisions of Article 71 of the Law.

TWENTY-THREE: The following days are considered as holidays in accordance with
the Law: January 1, February 5, March 21, May 1, September 16, November 20,
December 1 every sixth year for federal elections, December 25 and any other
days set forth by Federal and Local Electoral Law for regular elections. The
Company includes Good Friday and December 24 as additional holidays.

TWENTY-FOUR: The Company agrees and acknowledges that when holiday falls on a
Sunday, the Company honors the following Monday as a holiday with full pay. If
the holiday falls on a Saturday, the Company honors the prior business day as
the holiday with full pay.

TWENTY-FIVE: Company employees are entitled to an annual vacation period in
accordance with the provisions of Article 76 of the Federal Labor Law. Employees
who have been with the Company 4 years or less are entitled to payment of a
vacation bonus of thirty-five percent (35%) and employees who have been with the
Company more than 4 years shall receive a vacation bonus of 40% over their
corresponding wages.
 
TWENTY-SIX: The vacation period will not be calculated for those employees who
are disabled prior to their time off. Said employees shall be able to take
vacation when they are released from care and the Company approves them.
 
 
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Workers shall take their corresponding vacation days. They will not be
compensated for days not taken. If the employment relationship ends before one
year of service is reached, the employee is entitled to remuneration
proportional to the length of service.

TWENTY-SEVEN: The annual vacation period for each worker will be granted in
accordance with production needs and may be taken collectively, progressively or
individually. When the vacation days are taken collectively, they must take
place during a period chosen by the Company and the employees shall be informed
two weeks in advance. Employees shall receive the corresponding salary and bonus
before the vacation. When vacation days are taken progressively or individually,
the Company will schedule them based on the employee start date and within six
months following the completion of one year of service. Vacation time will be
granted for a continuous period or two periods and employees will be notified of
the date of vacation at least one week in advance.

TWENTY-EIGHT: The wages that workers receive under this contract will be those
that are described in the wage and salary rate, which is attached to this
Contract and is considered a part hereof.

TWENTY-NINE: Wages will be paid in Mexican currency [and be paid out] in the
workplace on Friday of each week. When payday falls on a day off, payment shall
be made on the previous day. Deductions from employee wages are prohibited,
except those authorized by Law. Wages shall be paid directly to the employee. In
those cases where it is impossible to pay the employee directly in person, wages
shall be paid to the person appointed proxy in a letter drawn up before two
witnesses, or given to the person authorized by Law. The Company with the
employee’s consent can open bank accounts for its employees which are accessible
through ATMs.

THIRTY: Employees shall have a 15 minute break in the morning and a (10) ten
minute break in the afternoon. These periods will be paid regardless of thirty
minutes for food and will be counted as time worked.
 
 
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THIRTY-ONE: The Company will deduct two percent (2%) of each employee’s monthly
wage for the purpose of paying union dues. The amount will be delivered to the
legal representative of the Union who will issue the corresponding receipt.
 
THIRTY-TWO: If for any reason there is a need to modify the employee shifts, the
Union will be notified of said change at least 24 hours in advance. The company
has the right to determine shifts and business days.

THIRTY-THREE: The Company provides workers with the tools, instruments and
materials needed to carry out the work. Employees must notify their superiors
when they do not have tools or instruments so that they can be replaced.
Employees are required care for the tools, instruments, machinery and equipment
entrusted to them and use the properly.

THITRY-FOUR: On the days indicated, employees will return any excess materials
given them for their job performance and Company instruments when the employees
no longer require them for their job.

THIRTY-FIVE: The Company shall not accept any excuse or pretext for the loss of
raw materials, tools, supplies, equipment or fixtures owned by the same. The
company recognizes that workers are not responsible for the normal wear and tear
on tools or equipment from normal and proper use. If an employee is held
responsible for damage, he agrees that 15% (fifteen percent) of his salary over
minimum wage shall be deducted from his pay until the debt is liquidated. The
amount is determined by the purchase price of the article or the amount
necessary to pay off any debt.  . The company may also retain the amount
necessary to pay for the damage, if the employment relationship is terminated
for any reason. The fifteen percent (15%) will be based on the original purchase
price of the tools, materials and not its replacement cost.

THIRTY-SIX: The Company and the Union agree that time clocks will be placed in
strategic locations for employees to clock in and out and the number of clocks
will increase as the number of employees increases.
 
 
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THIRTY-SEVEN: Both parties agree that if at the beginning of the business day
the company does not have material which hinders further product development and
as a result it becomes necessary support work other departments, the Company
shall relocate employees to another job. If that is not possible the Company
shall guarantee payment of the work day.

THIRTY-EIGHT: Both parties agree and accept that the Company may suspend
activities for ten (10) days of the year for inventory or to perform general
maintenance on the equipment or facilities. It is understood that the Company
shall have no obligation to pay wages to employees during that period, except
for those employees are called in to support said activities.

THIRTY-NINE: Once a year, upon the written request of the Union, the Company
shall allow a worker to miss work for a maximum of ten (10) days, with pay, so
that he/she can attend activities or events as a union delegate, provided such
absence is justified in writing and does not harm the interests of the company.

FORTY: Workers who are not able to come in due to illness, accident or for any
other reason, shall immediately notify their Supervisor or the Company Human
Resources Department as soon as possible. After notifying the company, the
employee is required to submit a copy of a disability certificate issued by the
Mexican Social Security Institute in order to justify the absence. Failure to
attend without presenting said document as proof is sufficient for the absence
to be considered unexcused.

FORTY-ONE: The Company shall record all employees with the Mexican Social
Security Institute (IMSS) so they will have coverage for workman’s compensation,
non-occupational illness, and other obligations in accordance with the
provisions of Article 12, Social Insurance Law.
 
 
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When a disability is more than five days (5) as certified by IMSS for non-work
related illnesses, the Company agrees to cover one hundred percent (100%) of the
tabulated daily wage for the first three days of disability and forty percent
(40%) for the following three days.  The employee is obligated to show the cause
of his absence by submitting a medical certificate from said institute to the
Company. This certificate will be given to an employee only once each year.

FORTY-TWO: Both parties agree that employees working for the company, will be
given, free of charge and one time only, an identification card with the logo of
the company. If employees require additional credentials, they will be issued at
their own expense.

FORTY-THREE: The Company and the Union agree that the following are cause for
suspension of the work relationship with the company:

1. Force majeure or act of God which are not caused by the employer and lead to
the suspension of work
2. Excess production in relation to their economic and market circumstances.
3. Unaffordable or the inability to obtain materials for the normal execution of
work.
4. When machinery, buildings, or raw materials are damaged or destroyed due to
unforeseen circumstances which justify the suspension of operations.
5. An interruption in delivery of services.
6. Lack of customer approval and / or production needs.

The parties agree that as a support to personnel when the suspensions occur,
employees would be paid as follows: the first day of suspension will be paid
100%, and the second to fourth day will be paid at 70% of salary; the second
week both parties will come to an agreement., The company has no liability in
relation to a suspension of the employment relationship.

FORTY-FOUR: The employees are entitled to an annual Christmas bonus calculated
as follows,

Less than a year of service is proportional to the time worked
From 1 year to 4 years
More than 4 years
 
15 days bonus
20 days bonus
 

 
 
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Bonuses must be paid out by the Company before December 20 of each year. Any
employee that has not completed a year working for the company shall receive an
amount proportional to the time of his service, in accordance with the
provisions of Article 87 of the Law.

FORTY-FIVE The Company shall pay employees who have completed more than a year
of service and have notified seven in advance 3 days off with pay and payment of
$800.00 (Eight hundred pesos 00/100 ) when they get married, upon request seven
days in advance. A photocopy of the marriage certificate issued by the Bureau of
Vital Statistics is required for confirmation.

FORTY-SIX: The Company will grant three days with pay to workers for the death
of a wife or a first degree relative such as parents and children.

Notwithstanding this provision and other benefits provided by law, the company
shall pay the employee the amount of $3,500.00 (Three thousand five hundred
pesos 00/100) to help with funeral expenses.

FORTY-SEVEN: The Company shall pay employees the amount of $15.00 (fifteen pesos
00/100) per working day to assist with transportation costs. Said payment shall
be made weekly.

FORTY-EIGHT: The company is required to purchase or grant a life insurance
policy in the amount of: $10,000.00 (ten thousand pesos 00/100) for natural
death and 20,000.00 (twenty thousand pesos 00/100) for accidental death. The
insurance will take effect at the time the employee signs his employment
contract. The worker will choose the beneficiary or beneficiaries.

FORTY-NINE: The Company has agreed to support its workers with $600.00 (six
hundred pesos 00/100) of financial assistance  per employee for the purchase of
prescription lenses, which will be awarded based on the following: Assistance
shall be given to only ten people per year, provided the corresponding medical
record stating the need for said lenses is presented. The selection of the four
people shall be based on attendance, productivity, behavior, and primarily the
need for the prescription lenses. One employee shall be selected every three
months.
 
 
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FIFTY: The Company shall promote the sports each season, as long as workers play
the entire season.

FIFTY-ONE: The company agrees to pay their employees a consumer basket of $15.00
(fifteen pesos 00/100) per day worked; payment will be made weekly.

FIFTY-TWO: The Company agrees to pay 7% to the employee’s savings fund for those
employees who have less seniority than four years and for those who have
seniority of over 4 years, 9% to the savings fund.

FIFTY-THREE: The Company shall provide its workers with a food subsidy in the
form of a coupon redeemable for food or beverages.

FIFTY-FOUR: The Company shall grant three days with pay and a payment of
$1,000.00 (one thousand pesos 00/100) to any worker whose wife gives birth to a
baby. One day for the birth, and the other days to take his wife home from the
hospital. The birth certificate must be presented to the Company as proof.

FIFTY-FIVE: The Company may move employees from departments or activities which
it considers dangerous. The Company will make every effort to protect the health
of their employees, making such changes upon confirmation from the Mexican
Social Security Institute.

FIFTY-FIVE – A: The Company is committed to providing financial support of
$500.00 (five hundred pesos 00/100) for education of 5 people per year; either
employees or their children. Selection of these individuals shall be based on
attendance, productivity, behavior, and business needs.

FIFTY-SIX: All matters relating to the Mexican Social Security Institute and
INFONAVIT shall be governed by applicable laws and regulations.
 
 
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FIFTY-SEVEN: The Company shall establish an area for food in the workplace, away
from production areas, and make the equipment necessary available to enable
workers to heat and eat their food during the rest period that the Company
grants for such purposes.

FIFTY-EIGHT: Both parties agree that for purposes of industrial hygiene, they
shall comply with health authority regulations and other rules established by
the Joint Committee. The committee shall perform investigations and convene
monthly meetings as well as research and resolve conditions that may have caused
accidents and unsafe work situations.

FIFTY-NINE: In order to minimize work risks, the Company shall provide employees
and employees shall use the specific safety equipment is necessary for
appropriate health and security in their respective duties in accordance with
applicable law.

SIXTY: The Company will keep bathrooms, toilets and drinking fountains clean for
use by workers, and supply water dispensers in an appropriate manner. Workers
are required to maintain said facilities to the highest standards of hygiene and
cleanliness.

SIXTY-ONE: For all employees hired by the company, the Company and the Union
expressly agree to establish a trial period of 60 days which starts on the date
of contract. During the probationary period the company shall be entitled to
terminate the employment relationship, without any Company liability.

SIXTY-TWO: In order to comply with the regulations set forth in section XV of
Article 132, 153 of the Law and Article 123 of the Constitution, the Company and
the Union will promote training and development for employees and promote
creation of the Joint Committee on Development and Training.
 
 
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SIXTY-THREE: Both parties agree that within a maximum of 60 days of signing this
agreement, the parties will comply with Internal Labor Regulations, and the
agreement will be registered with the competent authorities in accordance with
the Law. Following registration, this document shall be printed in miniature and
distributed to union members.

SIXTY-FOUR:  While this contract is in force, it may not be changed to the
detriment of Company employees without complying with Federal Labor Law and its
provisions.

SIXTY-FIVE: This collective bargaining agreement shall come into force on the
date it is filed with the Board of Conciliation and Arbitration.

SIXTY-SIX: The term of this Collective Bargaining Agreement is for an indefinite
period of time and will be reviewed in accordance with the terms of Articles 399
and 399 A of the Law. In accordance with the foregoing and by agreement of the
parties, it is agreed that effective date of this contract will be  January 1,
2011, noting that as this date is set the negotiations for the general revision
of this Collective Agreement off set for July 2, 2011 are closed and agreed to.
Future revisions are January 1, 2012, for salary reviews and July 2, 2013 for a
general review.

Once the parties are aware of the scope and legal effects of this Collective
Bargaining Agreement, the parties agree to register it with the Board of
Conciliation and Arbitration, so that the content is known for the corresponding
legal effects, on January 31, 2011.
 
FOR THE COMPANY
 
FOR THE UNION
         
[illegible signature]
 
[illegible signature]
 

LYNN STEVENS LIC. HUGO LARA EDUARDO MARTINEZ LEGAL REPRESENTATIVE SECRETARY
GENERAL FOR THE SINDICATO INDUSTRIAL AUTONOMO DE OPERARIOS EN GENERAL DE
MAQUILADORAS DE REYNOSA, C.T.M.
 
[illegible signature]
 
[illegible signature]
 

 
LIC. NORA I. GOMEZ GONZALEZ MR. GERMAN JOSE LUIS RDZ.  HUMAN RESOURCES MANAGER
SECRETARY OF LABOR
 
 
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IN THE CITY OF REYNOSA, TAMAULIPAS, ON JANUARY 31, 2011 APPEARED C. LYNN STEVENS
LEGAL REPRESENTATIVE FOR THE NEXUS MEGNETICOS DEMEXICO, S. DE R.L. DE C.V.
COMPANY AND C. HUGO LARA EDUARDO MARTINEZ SECRETARY GENERAL OF THE SINDICATO
INDUSTRIAL AUTONOMO DE OPERARIOS EN GENERAL DE MAQUILADORAS DE REYNOSA, (CTM))
TO EFFECT CHANGES TO THE WAGE SCALES MADE UNDER THIS CONTRACT. SAID CHANGES WILL
TAKE PLACE AS OF JANUARY 1st OF THIS YEAR AND WILL BE AS FOLLOWS:

WAGE SCALES
 
CATEGORY
 
DAILY WAGE
         
OPERATOR "A"
 
$ 83.87
         
OPERATOR "B"
 
$ 95.28
         
OPERATOR "C"
 
$ 106.69
         
Operator “D”
 
$ 124.17
 

 
OPERATOR SPECIALIST: (WELDING, ELECTRICAL TESTING, SPOOLER, CUT NOMEX, GROUP
LEADER AND QUALITY AUDITOR ADDING BRACKET AND TERMINALS POSITIONS).
 
3 MONTHS TO 1 YEAR
 
$ 155.64
         
1 TO 3 YEARS
 
$ 167.38
         
3 YEARS OR MORE
 
$ 170.08
 

 
 
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WAGES WILL BE PAID TO EMPLOYEES AS THEY MEET COMPANY REQUIREMENTS INCLUDING, BUT
NOT LIMITED TO: EFFICIENCY, ATTENDENCE, SENIORITY, EDUCATION, SKILLS, AND
TIMELINESS.

BOTH PARTIES EXPRESSLY AGREE THAT THE WAGE SCALES FORM INTEGRAL PART OF THE
COLLECTIVE BARGAINING AGREEMENT FOR NEXUS MAGNETICOS DE MEXICO, S. DE R.L. DE
C.V. THE FOREGOING COMPLIES WITH ARTICLES 386, 395, 399 AND OTHER RELATED
ARTICLES IN THE FEDERAL LABOR LAW, IN FORCE.

THE PARTIES FINALLY STATE THAT THERE ARE NO ERRORS, CORRUPTION, DAMAGE, BAD
FATIH CONTAINED IN THIS DOCUMENT AND IT IS SIGNED IN THE PRESENCE OF WITNESSES.
 
FOR THE COMPANY
 
FOR THE UNION
         
[illegible signature]
 
[illegible signature]
 

 
LYNN STEVENS LIC. HUGO LARA EDUARDO MARTINEZ LEGAL REPRESENTATIVE SECRETARY
GENERAL FOR THE SINDICATO INDUSTRIAL AUTONOMO DE OPERARIOS EN GENERAL DE
MAQUILADORAS DE REYNOSA, C.T.M.

[illegible signature]
 
[illegible signature]
 

 
LIC. NORA I. GOMEZ GONZALEZ MR. GERMAN JOSE LUIS RDZ.  HUMAN RESOURCES MANAGER
SECRETARY OF LABOR
 
 
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