Exhibit 10.1


 


Dated
June 30, 2003


 


VACUUMSCHMELZE
GmbH & Co.KG


 


ADVANCED
SUPERCONDUCTORS PROJECT HANAU GmbH & Co. KG


 






 


LEASE
AGREEMENT


 


HIGHWAY


 






 


HÖLTERS &
ELSING


RECHTSANWÄLTE


 


BERLIN
.. DÜSSELDORF . FRANKFURT


 

















 


Content


 


	
  Section 1

  	
  Leased Property

  	
  3

  
	
   

  	
   

  	
   

  
	
  Section 2

  	
  Provision of Services

  	
  5

  
	
   

  	
   

  	
   

  
	
  Section 3

  	
  Term and Termination

  	
  6

  
	
   

  	
   

  	
   

  
	
  Section 4

  	
  Rent

  	
  8

  
	
   

  	
   

  	
   

  
	
  Section 5

  	
  Service Charges

  	
  9

  
	
   

  	
   

  	
   

  
	
  Section 6 

  	
  Payment by the Tenant

  	
  11

  
	
   

  	
   

  	
   

  
	
  Section 7

  	
  Representations and Warranties

  	
  13

  
	
   

  	
   

  	
   

  
	
  Section 8

  	
  Security

  	
  14

  
	
   

  	
   

  	
   

  
	
  Section 9

  	
  Rebuildings by the Tenant/ Advertising
  Boards

  	
  15

  
	
   

  	
   

  	
   

  
	
  Section 10

  	
  Utility Supplies

  	
  16

  
	
   

  	
   

  	
   

  
	
  Section 11

  	
  Maintenance, Repairs and Decorative Repairs

  	
  17

  
	
   

  	
   

  	
   

  
	
  Section 12

  	
  Improvements and Structural Alterations by
  the Landlord

  	
  18

  
	
   

  	
   

  	
   

  
	
  Section 13

  	
  Liability of the Tenant

  	
  19

  
	
   

  	
   

  	
   

  
	
  Section 14

  	
  Liability of the Landlord

  	
  21

  
	
   

  	
   

  	
   

  
	
  Section 15

  	
  Insurances

  	
  23

  
	
   

  	
   

  	
   

  
	
  Section 16

  	
  Return of the Total Leased Area

  	
  23

  
	
   

  	
   

  	
   

  
	
  Section 17

  	
  Rights of Access

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 18

  	
  Subletting and Legal Successors of Tenant

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 19

  	
  Reconstruction Clause, Interruption of
  Operation

  	
  26

  
	
   

  	
   

  	
   

  
	
  Section 20

  	
  Miscellaneous

  	
  27

  
	
   

  	
   

  	
   

  
	
  Section 21

  	
  Non-Competition

  	
  28

  
	
   

  	
   

  	
   

  
	
  Section 22

  	
  Arbitration

  	
  28

  
	
   

  	
   

  	
   

  
	
  Section 23

  	
  Final Provisions

  	
  29

  



 


2

















 


Commercial
Lease Agreement


 


between


 


Vacuumschmelze
GmbH & Co. KG

Grüner Weg
37, 63450 Hanau, Germany


 


-the
“Landlord” -


 


and


 


Advanced
Superconductors Project Hanau GmbH & Co. KG

Silberstreifen 4, 76287 Rheinstetten, Germany


 


-the
“Tenant” -


 


- each
of them a “Party” or jointly the “Parties” -


 


Section 1

Leased Property


 


1.1                                 The Landlord
leases to the Tenant all areas which are solely related to the High Temperature
Superconductor (the “HTS”) and Low
Temperature Superconductor (the “LTS”)
production (jointly the “HTS and LTS Business”)
located on the Landlord’s premises in Josef-Bautz-Strabe (mail address: Ehrichstrabe 5), 63450 Hanau, Germany (the “Premises”) which are marked in pink on the building plan
attached in Annex 1 (hereinafter referred
to as “Total Leased Area”). The Total Leased
Area amounts to 5,666 square meters (in words: five thousand six hundred sixty
six square meters) of buildings and plants (the “Leased
Buildings”) and to 80 parking spaces.


 


The areas on the Premises not
leased to the Tenant are marked as follows:


 


3

















 


The area solely used by the
Landlord is marked in green (the “Soley Used Area”)
and the area jointly used by both Parties (e.g. trafficroutes, social rooms
etc.) is marked in blue (the “Common Used Area”).


 


1.2                                 Without
limiting and notwithstanding any of the representations and warranties pursuant
to Section 7 hereof the Total Leased Area shall be leased as inspected.


 


1.3                                 The Tenant
shall use the Total Leased Area for the development and production of HTS and
LTS products and any auxiliary operations of the HTS and LTS Business.
Technical and organisational changes and developments of the HTS and LTS
Business are admissible without the consent of the Landlord to the extent that
the Tenant shall not interfere with the business of the Landlord remaining on
the Premises. Any use of the Total Leased Area not belonging to the production
and manufacture of superconductors is only admissible with the prior written
consent of the Landlord, which shall not be unreasonably withheld.


 


1.4                                 Any and all
kinds of noxious, smells and noises attributable to the HTS and LTS Business as
it is normally conducted are hereby accepted by the Landlord.


 


1.5                                 The Tenant, its
agents, employees, customers and suppliers shall use the Common Used Area only
to access the Total Leased Area or, in the case of the Tenant and its
employees, for social purposes (e.g. canteen, toilets etc.). Neither the Tenant
nor its guests, employees, customers or suppliers shall enter the Solely Used
Area unless specifically authorised by the Landlord.


 


1.6                                 All five
(5) cranes which are fixed to structural parts inside the buildings on the
Premises (the “Cranes”) shall remain in the ownership of the Landlord and shall
be leased hereunder to the Tenant.


 


1.7                                 All machinery
and all other assets fixed, anchored or otherwise positioned to the Leased
Buildings which are assigned and transferred to the Tenant under the Sale and
Purchase Agreement are only fixed, anchored or otherwise positioned to the Leased
Buildings temporarily and shall not be part of the Leased Buildings within the
meaning of § 94 of the German Civil Code (BGB),
but shall be Scheinbestandteile within
the meaning of § 95 of the German Civil Code (BGB).


 


4

















 


Section 2


Provision
of Services


 


2.1                                 The Landlord
shall put the Tenant in a position to continue the HTS and LTS Business
purchased from the Landlord on the same areas of the Premises, used by the
Landlord for such HTS and LTS Business prior to the transfer of the HTS and LTS
Business to the Tenant. Therefore, the Landlord itself, or through an entity
designated by the Landlord, shall provide the Tenant with the following
services (the “Services”):


 


a.                         operating,
maintaining, repairing, replacing and cleaning of the Common Used Area
(including all buildings, plants, sidewalks, streets, etc);


 


b.                        operating,
maintaining, repairing, replacing and cleaning of all conduits (gas, water,
electricity, ventilation, compressed air etc.) of the Total Leased Area;


 


c.                         electricity,
gas and lighting supply to the Total Leased Area;


 


d.                        landscape and
landscape maintenance to the Total Leased Area;


 


e.                         providing and
disposing of water to the Total Leased Area (excluding waste water treatment);


 


f.                           removal of snow
and ice from the Common Used Area;


 


g.                        providing of 24
hour security on the Premises;


 


h.                        operating,
maintaining, repairing, replacing and cleaning of the Cranes.


 


2.2                                 In order to
ensure the provision of the Services to the Tenant, the Landlord is entitled to
conclude contracts with reputable service companies (the “Service
Contracts”). With respect to the Services pursuant to
Section 2.1 lit g any service company shall be disclosed to the Tenant
prior to entering into a Service Contract.


 


2.3                                 With respect to
the use of the Cranes, the Landlord and the Tenant shall mutually agree on a
adequate use of the Cranes by both Parties on the basis of the availability and
the scope and form of use during the last 6 month immediately prior to the
commencement of this Agreement.


 


5

















 


Section 3

Term and Termination


 


3.1                                 Term


 


3.1.1                        This Agreement
shall enter into force upon the consummation of the transaction with regard to
the HTS and LTS Business contemplated in the Sale and Purchase Agreement
entered into between the Parties on the date hereof


 


3.1.2                        The term of
this Agreement shall be for a fixed period ending on December 31st, 2007 (the “Base Term”). Subject to and upon written notice (the “Extension Notice”) to the Landlord, the Tenant shall be
entitled to extend the term for another fixed period of five years ending on
December 31st, 2012 (the “Extended Term”). The Extension Notice shall be sent to the
Landlord not later than 12 months prior to the end of the Base Term. In this
case the Parties shall mutually agree on a rent adjustment. If no Extension
Notice is sent in due time this agreement shall be terminated by either Party
giving a written six months notice to the end of a calendar year, for the first
time to December 31st 2007. If this Agreement is not terminated
without cause by either Party subject to a notice period of 12 months to the
end of the Extended Term, the Agreement shall continue for a further period of
three years and thereafter for further periods of three years each, until a
notice is given, satisfying a twelve months notice period to the end of the
Agreement’s extension. In each case of an extension of this Agreement the
Parties shall mutually agree on a rent adjustment. If the Parties cannot agree
on a rent adjustment, each Party shall be entitled to request the appointment
of an expert arbitrator by the President of the Chamber of Commerce of
Frankfurt am Main, who shall decide at his/her own discretion on any adjustment
of the rent and whose decision shall be final and binding on both Parties..


 


3.2                                 Termination for Cause by the
Landlord 


 


The Landlord may terminate
this Agreement with immediate effect for good cause (Kündigung aus wichtigem Grund). Good cause permitting a
termination without notice shall be, without this list being deemed exhaustive,
if:


 


3.2.1                        the Tenant is more than two
consecutive months is arrears with the payment of the


 


6

















 


rent or with payments
equalling two months rent, or if within a calendar year on at least three
occasions it is more than ten calendar days in arrears with such payments and
has been warned in writing; advance payments for service charge and the
statutory value added tax shall be deemed to be components of the rent for the
purpose of this clause;


 


3.2.2                        despite a written warning
from the Landlord, the Tenant:


 


a.               commits a substantial breach
of this Agreement;


 


b.              substantially violates the
rights of the Landlord or other tenants in any other way;


 


c.               is in breach of its
obligation under Section 1.3 of this Agreement;


 


d.              subject to Section 18
transfers possession of the Total Leased Area to a third party without written
consent of the Landlord; or


 


e.               does not provide the
security within the time limits as defined in Section 8.1;


 


3.2.3                        the Tenant suspends its
payment;


 


3.2.4                        the Tenant does not pay the
insurance premiums according to Section 15.


 


3.3                                 Termination for Cause by
Tenant


 


The Tenant may terminate
this Agreement with immediate effect for good cause (Kündigung aus wichtigem Grund). Good cause permitting a
termination without notice shall be, without this list being deemed exhaustive,
if:


 


3.3.1                        the Landlord is in breach of
an essential contractual obligation (Kardinalpflichten);


 


3.3.2                        the Landlord
refuses to consent to any installations by the Tenant pursuant to Section 9.1
if such refusal would cause a substantial impairment or disadvantage to the HTS
and LTS Business or the contractual use of the Total Leased Area;


 


3.3.3                        despite a
written warning from the Tenant, the Landlord or any of the Landlord’s tenants
continues to substantially violate the rights of the Tenant hereunder by
conduction any business on the Soley Used Area;


 


7

















 


3.3.4                        The Service Agreement is
terminated by whatever reason.


 


3.4                                 Liability


 


3.4.1                        In the event of
a premature termination of the Agreement in accordance with Section 3.2.1 to
3.2.4, the Tenant shall be liable for the loss of rent, service charge and
other services during the originally envisaged Term as well as for any other
damages which the Landlord suffers as a result of the premature termination of
this Agreement, notwithstanding the Landlord’s right to other penalties or
interest. In case the Landlord leases the Total Leased Area within the
originally envisaged Term to a third party the amount payable by the Tenant to
the Landlord pursuant to sentence I above shall be reduced by the rent and
service charge payable to the Landlord by this third party. The same shall apply
accordingly if the Landlord or any of its affiliates uses the Total Leased Area
within the originally envisaged Term.


 


3.4.2
                     In the event of
a premature termination of the Agreement in accordance with Section 3.3.1
to 3.3.4, the Landlord shall be liable for any and all losses or damages
incurred by the Tenant as a result of the premature termination of this
Agreement, notwithstanding the Tenant’s right to other penalties or interest.


 


3.5                                 No Extension


 


The expiry of the Term of
this Agreement shall be authoritative and binding even if the Tenant continues
to use the Total Leased Area; contrary to § 545 German Civil Code (BGB) the Agreement shall then not be
deemed to be extended for an indefinite period of time.


 


Section 4

Rent


 


4.1                                 The rent (Mietzins) per square meter shall amount
to € 5.50 (in words: five Euros and fifty Cents) per month plus value-added tax
(the “VAT”) and is charged on the square
meters of the Leased Buildings (the “Building Rent”).
The rent for the Parking Spaces shall amount to € 15,00 (in words: fifteen
Euros) plus VAT per month and per Parking Space (the “Parking
Space Rent”). On the basis of 5,666 square meters of Leased
Buildings and 80 Parking Spaces, the total Rent amounts to


 


8

















 


€ 32,363.00 (in words: Euros
thirty two thousand three hundred sixty three) plus VAT and plus adequate
insurance fee per month (the “Total Rent”).
The insurance fee shall be calculated on a pro rata basis of the spuare meters
of the Premises used by the Tenant and the Landlord based on the respective
Landlord’s insurance policy for the Premises.


 


4.2                                 This Total Rent
shall include all the Services listed in a, b, d, f, g and h of Section 2 and
the costs for exterior lighting (Aubenbeleuchtung)
on the Total Leased Area and the Common Used Area.


 


Section 5

Service Charges


 


5.1                                 Charges


 


The Landlord shall charge to
the Tenant, and the Tenant shall pay to the Landlord any and all charges, fees,
expenses, costs, quotas and taxes pertaining or connected to the Services set
out in Section 2.1 c and e (the “Service Charge”),
provided the Service Charge is calculated on a reasonable basis taking into
account reasonable and evidenced costs of the Landlord, which are directly
related to the Services. The Service Charge shall be due in addition to the
payment of Rent.


 


5.2                                 Other Charges


 


5.2.1                        The Tenant
shall pay directly to the competent offices and authorities all other charges,
taxes, duties and imposts directly attributable to the Total Leased Area (the “Other Charges”).


 


5.2.2                        On demand, the
Tenant shall provide to the Landlord sufficient evidence of payment of the
above imposts, taxes, duties and charges.


 


5.3                                 Budget and Statement of
Service Charge


 


5.3.1                        The Tenant
shall be provided with an estimate (subject to increase or decrease) of the Service
Charge due for the first year and hereby accepts the estimate as being subject
to any well founded increase or decrease.


 


9














 


5.3.2        The
Landlord shall keep appropriate invoices, records and documentation with respect
to the Service Charge.


 


5.3.3                        As soon as
practicable after the end of each calendar year, but in no event later than September 30th of each following year for the preceding year,
the Landlord shall provide the Tenant with a statement of the total Service
Charge (the “Statement”).


 


5.3.4                        The invoices,
records and documentation pertaining to the Statement will be available for a
period of one month after provision of the Statement for inspection during
normal business hours at the offices of the Landlord. Insofar as it affects the
Service Charge, the Tenant may challenge the Statement by written notice (“Challenging Notice”). Such notice must be given within one
month after receipt of the relevant Statement. In the absence of a timely
challenge, the Statement shall be deemed accepted, and the Tenant shall be
deemed to have waived any claim with regard thereto (“Final
Statement”).


 


5.3.5                        Any dispute
between the Landlord and the Tenant concerning the Statement shall be determined
by an expert whose decision shall be final and binding on the Parties, provided
that the Parties find no mutual agreement within 30 days of the receipt of the
Challenging Notice issued by the Landlord.


 


5.3.6                        Unless the
Landlord and the Tenant agree upon the identity of the expert, each Party may
apply for an expert to be appointed by the president of the Institute of
Accountants (Institut der Wirtschaftsprüfer
e. V.) of Düsseldorf. Such
expert must hold the position of a partner of PriceWaterhouseCoopers or of an
international accounting firm with a similar reputation. The expert shall be
entitled to ask the Landlord and/or Tenant to provide additional documents and
information if he considers those submitted under this Agreement to be
insufficient. The expert must allow the Landlord and the Tenant to make
representations and counter representations. The expert shall issue his
decision (also regarding the costs of this procedure) within 60 days after his
appointment. If the expert cannot or does not issue the decision within sixty
(60) days of the appointment, the appointment procedure outlined above is to be
repeated, unless the Parties otherwise agree.


 


5.4           Additional
Costs


 


The Service Charge relates
to the costs of the Services pursuant to Section 2.1 c and e and Section 5.2.
The Landlord shall be entitled to apportion to the


 


10

















 


Tenant newly introduced
rates, levies and other charges which directly arise from the Tenant’s use of
the Total Leased Area, including those introduced retroactively, as from the
time they arise.


 


5.5                                 Excluded Costs


 


The costs of maintenance (Instandhaltung) and repairs (Instandsetzung) of roofs, (including roof
windows) external walls including facades, load-bearing walls and other
structural parts (Dach und Fach) of
the Total Leased Area shall not form part of the chargeable Service Charge.
Such costs shall be borne by the Landlord.


 


Section 6

Payment by the Tenant


 


6.1.          Payment
of Base Rent


 


The Total Rent shall be
payable in advanced monthly instalments due on the third working day of each
month (the “Total Rent Payment Day”).


 


6.2           Payment
of Service Charge


 


6.2.1        The
Tenant shall pay the Service Charge in advanced monthly instalments on the Total
Rent Payment Day.


 


6.2.2                        In the event of
exceptional but evidenced unbudgeted expenditures with respect to the Services
pursuant to Section 2.1 c and e that cannot be delayed and for which there
are insufficient funds in the Service Charge account, the Landlord may request
an exceptional payment on account of the Service Charge which the Tenant shall
pay on demand and without claiming any exception. Such exceptional payments
shall be payable within 10 working days.


 


6.2.3                        if, pursuant to the Statement, the total payments made
on account of the Service Charge during the relevant year are less than the
Service Charge actually due, the Tenant must, within one month of issue of the
Statement becoming final, pay any outstanding balance to the Landlord. If the
Statement is subsequently corrected, for example pursuant to Section 5.3.4
and Section 5.3.5 above, any resulting difference


 


11

















 


has to be paid by the Tenant
within one (1) month after the correction of the Statement.


 


6.2.4                        If, pursuant to
the Statement, the total payment made exceeds the Service Charge actually due,
the Landlord will repay the exceeding amount within one (1) month to the
Tenant.


 


6.2.5                        For the
avoidance of doubt, the Tenant may not refuse or delay payment of the Service
Charge for reasons not wanting, needing or requiring some or all of the
Services.


 


6.3                                 Direct Debit


 


The Total Rent and the
Service Charge shall be paid to the Landlord by way of Einzugsermächtigung
(i.e. authorisation by the Tenant that the Landlord may withdraw the
amounts due from the Tenant’s account — direct debit).


 


6.4                                 Right of
Allocation


 


If the payments made by the
Tenant do not satisfy the respective accounts receivable of the Landlord to its
integrity, they shall be credited first against the non-enforceable and
non-pending liabilities and then against the legally enforceable liabilities.
They shall apply first to the older and then to the more recent liabilities as
the Landlord at its sole and only discretion shall decide. The allocation made
by the Landlord shall be notified to the Tenant in writing.


 


6.5                                 Right of
Redefinition of Advanced Service Charge


 


The Landlord may redefine
the advanced Service Charge if the Landlord provides reasonable proof that the
advance payments do not cover the expenditures.


 


6.6                                 Coverage of
Costs


 


The allocation of payments
made by the Landlord shall cover all costs charged to the Landlord during the
respective turnover period. Any invoices received subsequently for previous
periods of settlement shall be taken into account at the following settlement
however, any invoices pertaining to any times prior to the commencement


 


12

















 


of this Agreement will not
be taken into account. If this Agreement begins or ends during a calendar
month, the Tenant shall bear the costs on a pro rata temporis basis.


 


6.7          Interest


 


In the event of any late or
unpaid amount due under this Agreement, the Landlord shall be entitled to
charge interest in arrears at a rate of 500 basis points above the three month
EURIBOR rate (the “Interest”).
Interest will accrue from the date of late payment, however in the case of a
breach of the Tenant’s duties under this Agreement (excluding the Tenant’s duty
to pay the rent). Interest will only accrue after a written notice of the
Landlord to the Tenant concerning the breach. Interest shall be due to the
Landlord, on any late or unpaid amount in addition to other rights and remedies
provided for in this Agreement.


 


6.8          Set-Off,
Retention Right


 


The Tenant may assert a
set-off or retention right with regard to the Rent and/or the Service Charge or
other claims of the Landlord under this Agreement only in respect of an
uncontested claim, a claim for which a decision upholding the claim is
forthcoming (entscheidungsreif) or
a claim already established in a legally binding manner.


 


6.9          Value
Added Tax


 


All amounts to be paid by
the Tenant to the Landlord under this Agreement shall be subject to VAT at the
respective statutory rate.


 


Section 7

Representations and Warranties


 


The Landlord herewith
represents and warrants that:


 


7.1                               the Total
Leased Area can be used by the Tenant for the superconductor production as
mentioned in the Information Memorandum free from any disturbances by the
Landlord, its employees, customers and suppliers, in particular the business of
the Landlord on the Soley Used Area will not interfere with the contractual use
of the Total Used Area.


 


13

















 


7.2                                 the Landlord is
the legal owner of the Total Leased Area and no third party rights, liens or
other encumbrances of whatsoever kind exist which could infringe the
contractual use of the Total Leased Area by the Tenant;


 


7.3                                 the Total
Leased Area covers all areas and buildings of the Premises required for the HTS
and LTS Business as it was performed by the Landlord prior to the date hereof,
with the exception of these areas on which services are rendered to the Tenant
under the Service Agreement,; and


 


7.4                                 the Total
Leased Area and all buildings, including without limitation all conduits, energy
supply, doors, locks, windows, shutters, blinds, heating meters, laps and
lavatories, are in a reasonable condition sufficient to continue and perform
the HTS and LTS Business without any impairment.


 


Section 8

Security


 


8.1          Guarantee


 


Upon the entering into force
of this Agreement, the Tenant shall provide the Landlord with security (the “Security”) serving the entire Term, and in the amount of €
97,089.00 (in words: Euros ninety seven thousand eighty nine) (three times
Total Rent net). The Security shall be lodged as an unconditional, irrevocable
and directly enforceable (selbstschuldnerische)
first call guarantee provided by a reputable German bank or a German
savings bank under public law. The guarantee must exclude the possibility that
the guarantor bank can fulfil its obligation by way of deposit with a court.
The guarantee, throughout its term of validity, must exclude the right of the
Tenant to raise the argument that the claim is barred by statute of
limitations.


 


14

















 


8.2          Use of Security


 


8.2.1                        The Landlord
shall be entitled to call upon the Security in respect of all claims pertaining
to the Lease and this Agreement against the Tenant. The Security shall also
cover claims by the Landlord after the end of this Agreement, e.g. for loss of
Rent, claims for damages, Interest or costs of legal action caused by any
unauthorised late vacation of the Total Leased Area by the Tenant at the end of
this Agreement.


 


8.2.2                        Insofar as the
Landlord makes use of the Security during the term of this Agreement, the
Tenant shall be obliged to increase it again to the agreed amount. If the
Tenant does not replenish the Security to the agreed amount within two months,
the Landlord shall be entitled to terminate this Agreement without notice
(Section 3.2.2.e).


 


8.3                                 Duration of
Security


 


8.3.1                        The Landlord
shall be obliged to return the Security three months after the end of this Agreement
provided that the Tenant has:


 


a.                                       vacated the
Total Leased Area,


 


b.                                      paid to the
Landlord all sums due under this Agreement, including all costs, damages,
indemnities, etc., and


 


c.                                       settled any
other outstanding claims with respect to this Agreement from the Landlord.


 


8.3.2                        If at the end
of this Agreement a Statement of the Service Charge still remains to be
calculated, the Landlord shall be entitled to retain an appropriate part of the
Security, at least, however, four times the amount to be paid pursuant to
Section 6.2.1, until payment is made.


 


Section 9

Rebuildings by the Tenant/ Advertising Boards


 


9.1           Changes to and in the Total Leased
Area, in particular conversions, fittings, installations and similar, require
prior written consent of the Landlord. Before installing machines, heavy
objects or other systems which have a material impact on 


 


15

















 


the structural integrity of
the Total Leased Area, the Tenant shall require the Landlord’s prior written
consent thereto, which shall not be withheld without reason.


 


9.2                                 Gas and
electrical appliances shall only be connected to the existing mains in accordance
with their capacity. Additional appliances shall only be installed with the
Landlord’s prior written consent. The consent can be refused, if the capacity
of the existing mains would be overloaded and the Tenant refuses to bear the
costs of the necessary alterations to the mains.


 


9.3                                 The use of
outside walls for advertising purposes, including the design of such external
advertising, requires the consent of the Landlord. The Tenant may mount a
plaque on each of the facilities’ advertising boards for this purpose. The
Tenant may furthermore mount a plaque with Highway’s label and company name at
each entrance of the Premises and at each of the buildings of the Total Leased
Area.


 


9.4                                 Subject to
Section 2.1 the Tenant must comply with its legal duties of care imposed on
it in relation to the Total Leased Area, the access routes to the property and
the public roads in front of the property. Upon termination notice by either
Party the Tenant shall be entitled to amend the plaques by a reference to the
new address of the Tenant. Such plaques shall remain mounted for a period of
six months following the expiration of this Agreement. Upon termination of the
lease and expiration of the six month period following the termination, the
Tenant shall remove all plaques and advertisements and remedy any damage
resulting from the mounting of the advertisement or the removal of such
advertisement.


 


Section 10

Utility Supplies


 


10.1                    Changes


 


Changes to the energy supply
(in particular a change to the current voltage) as a result of force majeure,
order by an authority or other impossibility for which the Landlord is not responsible,
shall not entitle the Tenant to claim damages against the Landlord. 


 


16

















 


10.2                         Disturbance /
Interruptions


 


If utility supplies of any
kind are temporarily disturbed or interrupted, the Tenant shall have no right
to reduce the Rent or Service Charge or to claim damages from the Landlord
unless the Tenant proves a default of the Landlord. The Landlord hereby assigns
any claims which it may have against the utility supplier to the Tenant, in
respect of loss suffered by the Tenant.


 


Section 11

Maintenance, Repairs and Decorative Repairs


 


11.1                         Tenant’s
Obligations


 


The Tenant shall ensure,
that the Total Leased Areas are adequately cleaned, aired and heated, and shall
treat the Total Leased Areas and the systems and equipment installed therein
with due care and keep them free of vermin.


 


11.2                         Decorative
Repairs


 


The Tenant shall, at his own
expense, carry out at reasonable intervals all decorative repairs
(wallpapering, painting or whitewashing the walls and ceilings, painting the
floors, the radiators including the heating pipes, the interior doors as well
as the windows and external doors from the inside, except for any roof windows)
inside the Total Leased Area. In addition, the Tenant shall maintain and repair
the following objects to the extent they are in his direct control, in
particular, window and door locks, locking mechanisms on the shutters, the
blinds, the lighting and doorbell system, the heating meters, the locks, the
taps, the lavatory flusher, the basin and drain, the boilers, the stove, and
replace all damaged window panes and display window panes, unless the Tenant
shows that he was not responsible for the damage pursuant to Section 13.


 


11.3         Substitution
Rights


 


If, despite a written request
of the Landlord at least fourteen days in advance, the Tenant fails to meet its
above mentioned obligations within reasonable time limits, the Landlord shall
be entitled to have the necessary work carried out at the Tenant’s costs. In
the event of imminent danger it shall not be necessary to provide for a time
limit.


 


17

















 


11.4                         Landlord’s
Obligation


 


In addition to its
obligations pursuant to Section 2, it is the responsibility of the
Landlord to maintain (Instandhaltung) and
repair (Instandsetzung) at its
own costs the structural parts (Dach, Fach
and Fassade) and the landscape of the Total Leased Area, in
particular external walls including facades, roofs, roof windows, load bearing
walls, sidewalks and streets. To the extent the Tenant is responsible for the
maintenance of windows and door facilities they do not form part of the
structural parts (Duch, Fach and Fassade) of
the Total Leased Area within the meaning of this provision.


 


11.5                           In principle,
the Landlord shall be responsible for all maintenance, repairs and cleaning
outside the Total Leased Area and the Tenant shall be responsible for all
maintenance, repairs and cleaning inside the Total Leased Area. However, this
shall not apply and the Landlord shall be fully responsible for any objects,
their maintenance, repair and cleaning and functioning pertaining to the
Services pursuant to Section 2, in particular the conduits up to the
connection with the machinery or other equipment and the Cranes.


 


Section 12

Improvements and Structural Alterations by the Landlord


 


12.1                         Improvements
and Structural Alterations


 


12.1.1                  The Landlord may carry out
necessary improvements and necessary structural alterations for the extension
or completion of the Total Leased Area, for preventing imminent danger or for
the repair of defects or damage, even without the consent of the Tenant. The
Landlord shall inform the Tenant, insofar as possible if the Tenant is to be
affected, ten (10) business days prior to the execution of such work,
unless in case of an emergency. In any case the Tenant shall agree on any work,
if such work may impair the contractual use of the Total Leased Area, except
for cases of an emergency.


 


12.1.2
               The Landlord
may also carry out appropriate improvements and appropriate structural
alterations for the extension or completion of the Total Leased Area and for
the preservation or modernisation of the Total Leased Area subject to the prior



 


18

















 


written consent of the
Tenant, which shall not be unreasonably withheld. In such case, the Landlord
will inform the Tenant of the intended work and the foreseeable impairments to
the contractual use of the Total Leased Area within a reasonable notice period
of at least ten (10) business days. The Landlord and the Tenant shall
agree on the way the appropriate improvements or alterations will be executed.
Any impairment of the contractual use of the Total Leased Area shall be avoided
as far as possible.


 


12.1.3
               The Tenant
shall keep the parts of the Total Leased Area which are concerned by such work
accessible. The Tenant shall not impair the performance of the work and the
Landlord shall organise and perform any such work so as to minimize the
disruption to the Total Leased Area. Any nuisance arising from the
aforementioned work, in particular odour, soiling, noise and reduction of the
amount of light or air enjoyed by the Total Leased Area shall be tolerated by
the Tenant without compensation. However, the right to reduction pursuant to
Section 12.2 remains applicable.


 


12.2        Right to Reduction of Rent or Service Charge


 


The Tenant may only reduce
the Rent or Service Charge if the work significantly impairs the contractual
use of the Total Leased Area.


 


Section 13

Liability of the Tenant


 


13.1        Damage caused to the Total Leased Area or Third Party
Property


 


The Tenant shall be liable
towards the Landlord for all damage wilfully or negligently caused to the Total
Leased Area or the Landlord’s or third party’s property by the Tenant, its
agents and/or employees as well as the craftsmen commissioned by it, its
suppliers and/or other persons in relationship with it. It shall, in
particular, be liable for damage caused by improper handling of high-voltage
and low-voltage facilities, to the toilet, sanitary, sprinkler and heating
systems, the Cranes, by failure to comply with fire prevention regulations or
to fulfil other obligations incumbent upon it (lighting, etc.).


 


19

















 


13.2                         Remedy


 


The Tenant shall remedy the
damage for which it is responsible in accordance with the foregoing Subsection
13.1 without delay. If it fails to fulfil this obligation despite a written
reminder specifying a reasonable period of time determined by the Landlord, the
Landlord may have the necessary work being carried out at the expense of the
Tenant. If such damage causes imminent danger or if the Tenant cannot be
contacted, it shall not be necessary to send a reminder or to allow an
additional period of time.


 


13.3                         Information
Obligation


 


Insofar as the Landlord is
responsible for the repair of defects or damage in the Total Leased Area, the
Tenant shall inform the Landlord without delay (unverzüglich). The Tenant
shall be liable for any more extensive damage caused as a result of delayed
notification.


 


13.4                         Safeguard
Traffic (Verkehrssicherungspflicht)


 


The lease is subject to the
duty to safeguard traffic (Verkehrssicherungspflicht)  within the Total Leased Area in
accordance with the general legal provisions. The Tenant is, in particular,
obliged to safeguard traffic against damage to the health, life, property and
other possessions of the Landlord, its employees and representatives and of
third persons that enter the Total Leased Area within its responsibility for
the buildings and landscape of the Total Leased Area according to
Section 11. The Tenant shall hold harmless, free and indemnify the
Landlord against claims by third parties in this respect. According to the
responsibility of the Landlord pursuant to Section 11.4 the Landlord is
obliged to safeguard traffic against damage to health, life, property and other
rights of the Tenant, its employees and representatives and of third persons
that enter the Total Leased Area.


 


13.5                         Escape Routes


 


Traffic and escape routes
shall be kept permanently free. No objects may be stored or otherwise placed on
the Premises outside the Total Leased Area.


 


20














 


Section 14


Liability
of the Landlord


 


14.1                           Liability
Standard


 


The Landlord shall only be
liable (“Liability Standard”) for damage caused
to the Tenant, its employees, agents, suppliers, customers and other
representatives to the extent that the Landlord:


 


a.               has caused such
damage as a result of wrongful intent or gross negligence; or


 


b.              has caused
injury to life, body, or health; or


 


c.               is in breach of
an essential contractual obligation (Kardinalpflicht)  or of an repreentation and warranty pursuant to Section 7
hereof; or


 


d.              is liable
according to compulsory law.


 


14.2                           Defects of the
Total Leased Area


 


The Tenant may only assert
damage claims in respect of defects of the Total Leased Area if the damage or
impairment is substantial and has been caused by the Landlord pursuant to the
Liability Standard. Notwithstanding the aforementioned, any rights of the
Tenant pursuant to § 536 of the German Civil Code shall remain effective.


 


14.3                           External
Influences


 


The Tenant may only assert
damage claims in respect of external influences created by third parties, such
as excavations, street closings, noise, odour and dust nuisances irrespective
of their extent, if the Landlord is responsible pursuant to the Liability
Standard.


 


14.4                           Other Liability


 


The liability of the
Landlord is also excluded for damages resulting from causes such as fire,
smoke, soot, snow, water, dry rot and humidity, unless the Landlord is
responsible pursuant to the Liability Standard and if the Landlord has not
rectified such defects within a reasonable time after timely notification by
the Tenant. The


 


21

















 


same shall apply for other
direct or indirect consequences, in particular resulting form malfunctions or
defect operation of the technical devices of the buildings.


 


14.5                           Third Parties


 


14.5.1                Liability
against Third Parties


 


The Landlord is liable for
loss or damage suffered by third parties (excluding employees or visitors of
the Tenant, and its suppliers and customers) whether directly or indirectly
only in accordance with the relevant statutory provisions. This applies also if
the affected third party has a contractual and/or quasi-contractual
relationship with the Tenant.


 


14.5.1                Damage caused
to the Highway Business or third party property


 


Not with standing the
aforementioned, the Landlord shall with respect to its business conducted on
the Soley Used Area (presently the business of Rascherstarrung) be liable
towards the Tenant for all damage wilfully or negligently caused to Highway or
Highway’s or third party’s property by the Rascherstarrung Business, the
agents, employees and craftsmen commissioned by this business and suppliers and
customers in relation with this business.


 


14.6                           Limitations


 


14.6.1
               For breaches of an essential
contractual obligation (Kardinalpflicht)  and/or violations of life, body or health, by the
Landlord, its executive body (Organe)
and/or its employees (Leitende Angestellte)  due to simple negligence (einfache
Fahrlässigkeit), the liability
of the Landlord is limited to the typical and foreseeable damage. This
limitation of liability to the typical and foreseeable damage also applies for
negligent (Fahrlässigkeit)  breaches of an
essential contractual obligation (Kardinalpflicht)  and damages caused gross negligently (grobe
Fahrlässigkeit)  by any other of
the auxiliary persons (Erfüllungsgehilfen)  of the
Landlord.


 


14.6.2
               The Landlord shall only be
liable pursuant to the Liability Standard with respect to the proper selection
and/or possible necessary surveillance of employees engaged by the Landlord,
which are not senior employees of the Landlord.


 


22

















 


14.7                           Applicability


 


All
exclusions or limitations of liability set out above or otherwise in
this Agreement in favour of the Landlord shall also apply in favour of the
employees and advisors engaged by the Landlord. Exclusions of liability
contained in this Agreement going beyond this remain unaffected by the above
provisions.


 


Section 15


Insurances


 


15.1                           The Landlord
will effect appropriate insurance coverage in respect of the premises and
charge the Tenant the premium accordingly.


 


15.2                           The Tenant
shall insure the contents of the Total Leased Area except for such contents
falling within the responsibility of the
Landlord, in particular any object pertaining to the Services hereunder or
pursuant to the Service Framework Agreement.


 


Section 16


Return of the Total Leased Area


 


16.1                           At the end of
this Agreement, the Tenant shall return the Total Leased Area to the Landlord
in the same condition as it was at the commencement of this Agreement. The
Tenant shall remove all objects
in the Total Leased Area, to the extent that they are not owned by the
Landlord. The Tenant shall remove all damages which are caused by the Tenant
during the lease or by the removal of its objects.


 


16.2                           If the Tenant
does not carry out the work necessary pursuant to Section 16.1 by the end
of this Agreement the Landlord can, after having set a reasonable deadline,
carry out such work at the cost of the Tenant. In such case, the Tenant shall
be liable for the costs which arise for the Landlord as a result of the delayed
completion of the work (in particular the loss of Rent and Service Charge).


 


23

















 


Section 17


Rights of Access


 


17.1                           The
Landlord and its representatives may enter the Total Leased Area
during normal business hours at any
time for inspection on not less than forty-eight (48) hours’ notice,
unless otherwise stated in this
Agreement, causing as little disturbance as practicable.


 


17.2                           In case of
emergency, the Tenant shall ensure that access to the Total Leased Area will
also be possible outside the normal business hours and in its absence (e.g. by
making available a sealed key to the Landlord). If such key is not made
available, the Total Leased Area may be entered in an appropriate manner in the
event of emergency. The person entering the Total Leased Area is to cause as
little damage and disturbance as practicable, however the costs associated with
any damage caused by such access shall be borne by the Tenant. The Landlord
shall take reasonable measures that any person entering the Total Leased Area
according to this provision shall keep any information regarding the HTS and
LTS Business strictly confidential.


 


17.3                           The Tenant must
allow access to all the Landlord’s plant and equipment within the Total Leased Area for maintenance purposes, at all reasonable times.


 


17.4                           The
Tenant, its representatives and/or employees shall not have the right to
enter the areas on the Premises which
are not part of the Total Leased Area or Common Used Area, except as otherwise agreed between the
Tenant and the Landlord or if required
to access to the canteen.


 


Section 18


Subletting and Legal Successors of Tenant


 


18.1                           Subletting


 


Subletting
of the Total Leased Area or any other transfer of possession for use to a
third party is only permitted with the prior written consent of the Landlord,
which shall not be unreasonably withheld. Section 540 para. (1) sentence 2 German Civil Code (BGB)  does not apply.


 


24

















 


18.2                           Change in
Corporate Structure


 


The Tenant shall inform the
Landlord in reasonable time of the following changes:


 


a.               if the Tenant
is a partnership, a change, whether directly or indirectly, of a personally
liable partner or of its legal form;


 


b.              if the Tenant
is a sole proprietorship, a change of the proprietor; and


 


c.               if the Tenant
is a corporation, a change with respect to one or more shareholder(s) as compared
to the structure of the Tenant at the Lease Commencement, regardless whether
this occurs in one or several steps, who hold(s) individually or jointly
at least a 25 percent share.


 


The Tenant shall also inform
the Landlord without undue delay in writing of changes in respect of the trade
licence or other circumstances which are relevant for this Agreement.


 


The Landlord is not entitled
to terminate this Agreement for good cause in the event of a change in the
corporate structure of the Tenant


 


18.3                         Sale of
Business


 


In the event of a sale of
the Tenant’s entire business or part thereof to an affiliated company of the
Tenant within the meaning of § 15 et seq. of the German Stock Corporation Act (Aktiengesetz), this Agreement shall be
transferred to the legal successor of the Tenant, without prior consent of the
Landlord provided that a proper continuation of this Agreement is not
jeopardised thereby. In the event of a sale of the Tenenat’s entire businesss
or part thereof to a third party, this Agreement shall only be transferred to
the legal successor of the Tenant, subject to the prior written consent of the
Landlord, such consent shall not be unreasonably withheld.


 


18.4                           Tenant’s
Transfer Prohibition


 


Unless otherwise agreed in
this Agreement, the Tenant shall not be entitled to transfer any rights and
obligations under this Agreement to third parties without the prior written
consent of the Landlord, such consent not to be unreasonably withheld. In the
event of a transfer of any rights and obligations under this Agreement to an


 


25

















 


affiliated company of the
Tenant within the meaning of § 15 et seq. of the German Stock Corporation Act (Aktiengesetz), these rights and obligations
shall be transferred without the prior consent of the Landlord. § 354a German
Commercial Code (Handelsgesetzbuch)  remains unaffected.


 


Section 19


Reconstruction
Clause, Interruption of Operation


 


19.1                           Substantial
Damage


 


If the Total Leased Area or
the facilities in common use are completely or substantially destroyed or
damaged by errors of design, fire, explosion, lightning, storm, force majeure,
acts of war or other circumstances, this Agreement shall expire only after the
Landlord has declared that he will not carry out a reconstruction. The Landlord
will make a declaration in this regard to the Tenant within five months after
the day of the damage. Before that point, there shall be no right of
termination. Insofar as the permitted activities of the HTS and LTS Business
regarding the damaged or destroyed Total Leased Area are no longer possible,
the Tenant’s obligation to pay Rent and Service Charge shall be suspended as
from the day following the damage. In the event of partial damage or
destruction, the obligation to pay Rent and Service Charge shall be suspended
on a pro-rated basis, insofar as the remainder of the Total Leased Area is
usable by the Tenant. After reconstruction, the provisions in respect the
payment of Rent and Service Charge shall apply mutatis mutandis.


 


19.2                           Interruptions


 


In the case of material
interruptions in the operation of the Total Leased Area (including but not
limited to a substantial interruption of utility supplies) - for any reason
whatsoever - irrespective of the Landlord’s responsibility, the obligation to
pay Rent and Service Charge shall be suspended for the time of interruption,
provided, however, the time period is substantial.


 


19.3                           Damages


 


In the aforementioned cases
the Tenant shall only be entitled to damages in accordance with Section 14.1.


 


26

















 


Section 20


Miscellaneous


 


20.1                           Landlord’s
Right of Transfer


 


The Landlord is entitled at
any time to transfer its rights and obligations hereunder to an affiliated
company, provided that a proper continuation of this Agreement is not
jeopardised thereby. Affiliated company shall be any company affiliated with
the Landlord within the meaning of § 15 et seq. of the German Stock Corporation
Code. The Landlord is entitled without limitation to sell the Total Leased Area
in its entirety or partially at any time. On the provision of notice of such
legal succession to the Tenant the Landlord withdraws from all rights and
obligations from the contractual relationship with the Tenant (releasing
transfer of contract to a legal successor).


 


20.2                           Right of First
Refusal I


 


In the event the Landlord
should intend or plan to lease the Common Used Area and/or the Soley Used Area
in its entirety or partially, the Landlord shall, prior to any approach to any
third party, including without being limited to any broker or agent, and in
each case be obliged to offer to lease such area to the Tenant pursuant to the
following provisions:


 


a.               The Landlord
shall provide a written offer to the Tenant covering the terms and conditions,
in particular the price, under which the Landlord intends or plans to lease the
respective area. The Tenant shall be entitled to accept the offer within 30
calendar days by a written letter of acceptance to the Landlord.


 


b.              The Tenant
shall only be entitled to accept the offer with respect to the complete area.


 


c.               If the Tenant
should not or not within the acceptance period accept the offer, the Landlord
may lease the respective area to any third party provided that the terms and
conditions of such sale are neither in the aggregate nor individually more
favourably than the terms and conditions of the offer to the Tenant. However,
the


 


27

















 


Landlord shall not be
entitled to lease any area to a competitor of the Tenant or its affiliates.


 


d.
           The Right of First Refusal I
shall revive if the respective area is not leased by the Landlord within six
months after the rejection by the Tenant or the expiration of the acceptance
period, whatever date occurs first.


 


20.3                           Right of First
Refusal II


 


In the event the Landlord
intends or plans to sell and transfer the Premises in its entirety or partially
to any third party, the Landlord shall inform the Tenant accordingly and shall
enter into negotiations with the Tenant upon the terms and conditions required
by the Landlord. If the Tenant and the Landlord should not agree on the terms
and conditions of a sale within 60 calendar days, the Landlord may sell and
transfer the Premises or its respective part to any third party, provided that
the terms and conditions of such sale are neither in the aggregate nor
individually more favourably than the terms and conditions first set forth by
the Landlord for the negotiations with the Tenant. However, the Landlord shall
not be entitled to sell the Premises in its entirety or partially to a
competitor of the Tenant or its affiliates.


 


Section 21


Non-Competition


 


The Landlord shall not lease
the Common Used Area and / or the Soley Used Area to any competitor of the
Tenant or its affiliates.


 


Section 22


Arbitration


 


All disputes arising in
connection with this Agreement shall be finally settled according to the
arbitration rules of the German Institution of Arbitration e. V. (DIS)
(the “Rules”) without recourse to the ordinary courts of law according to the
following provisions:


 


28

















 


(1.)                               Each Party
(“Requesting Party”) may, by written notice (the “Arbitration Request”) to the
other Party (the “Other Party”), refer such dispute, difference or question to
arbitration. The Arbitration Request shall set forth the nature of the dispute,
the amount involved (if any), the remedy sought, and the name and address of
the Requesting Party’s arbitrator.


 


(2.)                               The arbitral
tribunal shall consist of three arbitrators, one appointed by the Requesting
Party in the Arbitration Request and one appointed by the Other Party in
writing to the Requesting Party within sixty (60) days of the date of receipt
of the Arbitration Request. The arbitrators so selected shall, within sixty
(60) days of the date of appointment of the second arbitrator, agree on a third
arbitrator. If any of the arbitrators shall not be appointed within the time
limits specified above, such arbitrator shall be appointed by the President of
the Frankfurt/Main Chamber of Commerce at the written request of either party.


 


(3.)                               The arbitration
proceedings shall be held in English. The place of arbitration shall be Frankfurt
am Main/Germany. In the event of any conflict between the Rules and this
Agreement, the provisions of this Agreement shall govern.


 


Section 23


Final
Provisions


 


23.1                           Savings Clause


 


The validity of this
Agreement shall not be affected by the invalidity of individual provisions nor
by contractual gaps. An invalid provision or a gap shall be replaced or filled
by a valid provision which corresponds as far as possible to the meaning and
purpose of the cancelled provision or of the remaining provisions hereof.


 


23.2                           Written Form


 


Agreements, declarations and
representations (Zusicherungen)  of any kind whatsoever which concern this Agreement
or the Total Leased Area or other supplements, amendments, rescissions,
prolongations or additions of this Agreement shall only be valid if made in
writing (excluding telex, fax, or other electronic communication) and signed in
a legally binding manner by the Landlord and the


 


29

















 


Tenant. This applies also
with respect to a change or rescission of this written form requirement itself.


 


23.3                           Statutory
Requirements


 


The contracting parties are
aware of the particular statutory requirements under §§ 550, 126 German Civil
Code (Bürgerliches
Gesetzbuch) concerning written form. They hereby undertake at
any time and on demand of one of the parties to carry out all acts and to make
all declarations which are required in order to satisfy the statutory
requirements for written form, and not to terminate this Agreement prematurely
by relying on a possible non-compliance with the statutory written form. This applies
not only for the conclusion of this Agreement but also for possible contracts
containing supplements, rescissions, amendments, prolongations and additions.


 


23.4                           Annexes


 


This Agreement contains an
Annex. This Annex forms an essential part of this Agreement and is binding upon
both parties. In case of discrepancies between the Agreement and the Annex, the
provisions of this Agreement shall prevail.


 


23.5                           Counterparts


 


This Agreement is executed
in two originals, one for the Landlord and one for the Tenant.


 


23.6                           Governing Law,
Contract Language


 


The Parties hereby agree
that this Agreement and the respective rights, duties and obligations of the
Parties hereunder, shall be governed by an construed in accordance with the
laws of the Federal Republic of Germany, without giving effect to the
principles of conflicts of laws.


 


The Parties agree that the
relevant contractual language shall be English.


 


30

















 


23.7                           Place of
performance and place of jurisdiction


 


Not regarding
Section 22 (Arbitration), the place of performance and the place of
jurisdiction for all obligations arising out of this agreement shall be Hanau,
Germany.


 


 


Hanau, this 30th day of June
2003


 


	
  /s/ Andrea Bauer /s/ Paul Reinhard

  	
   

  	
  /s/ Victor Ringeisen /s/ Gerhard Ruth

  
	
  Landlord

  	
   

  	
  Tenant

  
	
   

  	
   

  	
   

  
	
  Represented by

  	
   

  	
   

  	
  Represented by

  	
   

  
					



 


31

















 


Annex 1


 


Building
Plans


 


32














 





 














 





 














 





 














 





 














 





 














 





 














 





 














 





 














 





 














 





 












 

(Translated from German)

 

Supplementary agreement to the lease

between

Vacuumschmelze GmbH & Co. KG

and

Advanced Superconductors Project Hanau GmbH & Co. K

dated June 30, 2003

 

Hanau, March 19, 2007

 

The following amendments to §1 and §4 of the aforementioned contract are hereby agreed upon between the contractual parties:

 

1. Amendment to the total rental area (§1)

 

Reduction in rental area

 

	
Site
   (Former designation)
    	
 
    	
Area in m2
    	
 
    
	
Bldg. 301 corridor 2 VI
    	
 
    	
14.84
    	
 
    
	
Total reduction
    	
 
    	
14.84
    	
 
    


 

The rented area (“leased area”) shall thereby be reduced from 5,751 m2 to 5,736 m2 effective April  1, 2007.

 

2. Change of the mutually used areas

 

Reduction in mutually used areas

 

	
Site
   (Former designation)
    	
 
    	
Area in m2
    	
 
    
	
Bldg. 301 corridor 3 G1
    	
 
    	
45.16
    	
 
    
	
Bldg. 301 corridor 3 G2
    	
 
    	
30.99
    	
 
    
	
Bldg. 301 corridor 3 G3
    	
 
    	
4.45
    	
 
    
	
Bldg. 301 corridor 3 G4
    	
 
    	
9.23
    	
 
    
	
Total reduction in jointly  used areas
    	
 
    	
89.83
    	
 
    


 

3. Amendment of the layouts

 

The layouts according to Attachment 1 (“building plans”) of the lease of June 30, 2003, shall be amended as indicated below and become a component of the lease as Attachment 1 of this supplementary agreement:

 

	
Location
    	
 
    	
Old drawing
    	
 
    	
New drawing
    
	
Bldg.   301 corridor 2 V1
    	
 
    	
3012   - 05a dated 10/30/02
    	
 
    	
301.2
    
	
Bldg.   301 corridor 3 G1
    	
 
    	
3013   - 04 dated 10/30/02
    	
 
    	
301.3
    
	
Bldg.   301 corridor 3 G2
    	
 
    	
3013   - 04 dated 10/30/02
    	
 
    	
301.3
    
	
Bldg.   301 corridor 3 G3
    	
 
    	
3013   - 04 dated 10/30/02
    	
 
    	
301.3
    
	
Bldg.   301 corridor 3 G4
    	
 
    	
3013   - 04 dated 10/30/02
    	
 
    	
301.3
    


 

1











 

Additional agreement to the lease

between

Vacuumschmelze GmbH & Co. KG

and

Advanced Superconductors Project Hanau GmbH & Co. K

dated June 30, 2003

 

Hanau, March 19, 2007

 

4. Rental change (§ 4)

 

The rent shall be reduced by €81.62 (14.84 m2 X €5.50) as of April 1, 2007

 

The total monthly rent shall be reduced from €32,529.50 to €32,447.88 as of April 1, 2007.

 

5. Amendment to Section 6, Paragraph 6.9 Value Added Tax

 

The contractual parties agree to the following supplement to Section 6, Paragraph 6.9, Value Added Tax to the lease of 06/20/2006:

 

The landlord is registered at the tax office at Hanau under Tax ID No. 022 377 00076

 

The tenant is registered at the tax office at Hanau under Tax ID No. 022 315 60388

 

6. The agreed upon changes under 1 through 5 are components of the lease dated June 30, 2003. All further conditions of the lease remain unchanged.

 

	
Vacuumschmelze   GmbH & Co. KG
    	
 
    	
European   Advanced Superconductors
    
	
GmbH &   Co. KG
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/   Paul Reinhard
    	
 
    	
/s/   Burkhard Prause
    
	
 
    	
 
    	
/s/   Peter Unvericht
    


 

Appendix 2: 5 Layouts

 

2











 

VAC

VACUUMSCHMELZE

 

European Advanced Superconductors GmbH& Co. KG

Dr. Burkhard Prause

Mr. Peter Unvericht

Ehrichstrasse 10

 

63450 Hanau

 

	
Your   reference
    	
Your   message of
    	
Our   reference
    	
Hanau,   Grüner Weg 37
    
	
 
    	
 
    	
K-HT   / PR
    	
12/19/2006
    


 

Lease agreement

Lease extension

 

Dear Dr. Prause,

Dear Mr. Unvericht,

 

With your written declaration of 10/31/06, you noted the contractually fixed option of another extension of our lease. The tenancy is thereby extended until 12/31/2012.

 

In accordance with §3.1.2, an adjustment of the rent is foreseen with each extension of the lease. With reference to the constantly escalating costs, we cannot avoid making an adjustment to the rent from 5.50 euros per m2 + value added tax to 5.85 euros/m2 + value added tax. This rent shall apply effective January 1, 2008. [handwritten: = 6.4%]

 

We still ask for your understanding that, at the present time to the best of our ability, we cannot arrange a renewed option for another 5 year extension after 12/31/2012. This also applies to an extension of period of notification from 12 to 24 months.

 

Of course, we are quite prepared to take up these topics again “closer to the date” and then find a solution that is satisfactory for both parties.

 

Yours truly,

 

VACUUMSCHMELZE GmbH & Co. KG

 

	
Andreas   Bauer
    	
Paul   Reinhard
    
	
CFO   Vac Group
    	
Vice   President
    
	
 
    	
Business   Administration
    


 

	
VACUUMSCHMELZE   GmbH & Co. KG
    	
Personally   liable partner:
    	
Chief   executive:
    
	
Grüner   Weg 97
    	
D-63450   Hanau
    	
VAC   Finanzierung GmbH
    	
Dr. Hartmut   Eisele
    
	
PO   Box 22 53
    	
D-63412   Hanau
    	
HDQ:   Hanau
    	
 
    
	
Phone:   switchboard ++ 49/6181-38-0
    	
Registry   court Hanau HRB 91707
    	
 
    
	
http://www.vanuumschmelze.com
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Legal   form: GmbH & Co. KG
    	
Operator:
    	
 
    
	
Headquarters:   Hanau
    	
Phone
    	
++49/6181   - 38 -
    	
 
    
	
Registry   court Hanau HRA 5479
    	
Fax
    	
++49/6181   - 38 -
    	
 
    
	
 
    	
E-Mail
    	
 
    


 











 

	
EAS
    	
European   Advanced Superconductors GmbH & Co. KG
    


 

EAS GmbH & Co KG Ehrichstraße 10, 83450 Hanau, Germany   COPY

 

Vacuumschmelze GmbH & Co. KG

Mr. Paul Reinhard

by in-house mail

 

	
Your   reference
    	
Your   message of:
    	
Our   reference
    	
Hanau,   Ehrichstraße 10
    
	
 
    	
 
    	
Unv
    	
10/31/2006
    


 

Lease Agreement /

Extension of the lease through 12/31/2012

 

Dear Mr. Reinhard,

 

in accordance with the contractual regulations of our lease (Section 3.1.2), EAS has the option of extending the lease by an additional 5 years until 12/31/2012 by so declaring in due time (an “Extended Term”).

 

We hereby declare in due time that we shall invoke this option and thereby want to continue our tenancy until 12/31/2012.

 

The contract furthermore provides that the tenancy shall be extended after 12/31/2012 by an additional 3 years in each case if not terminated by a contracting party at the end of the respective period of extension with an advance notification period of 12 months.

 

The strategic orientation of EAS emanates from its long-term stay at the present location, combined with further, steady investments into the production and construction of a new production technology, whose spatial and environmentally relevant requirements we are already discussing with your company.

 

Given this background, we request that you check whether or not we could amend the current contractual agreements to the effect that a renewed extension by a further 5 years within the meaning an “extended term” could be added after the rental period, which has now been extended to 12/31/2012.

 

Should you not be able to agree to such a change, then we propose at least increasing the notification period for cancelation from 12 months to 24 months since, according to our current knowledge, we can no longer assume that we will be able to find a new location and within 12 months and make the move in this

 

	
European Advanced   Superconductors 
   GmbH & Co. KG 
   Ehrichstraße 10 D 63450 Hanau
   Phone switchboard ++496181
   4384-4100 
    	
Personally liable   partner: 
   European Advanced Superconductors Verwaltungs
   GmbH
   HDQ: Hanau
   Court registry Hanau HRB 7581 
    	
Compiler: Peter   Unvericht
   Phone ++ 496181 4384 - 4138
   Fax: ++ 496181 4384-4445
   e-mail: Peter.Unvericht@
   advancedsupercon.com 
    
	
 
    	
 
    	
 
    
	
Legal format   GmbH & Co. KG
    	
 
    	
 
    
	
HDQ Hanau
    	
Chief corporate   officers
    	
 
    
	
Registry-court Hanau   HRA 5715
    	
Dr. Burkhard   Prause, Dr. Tony Keller, Jörg Laukien,
    	
 
    


 











 

time without drastically affecting our delivery ability as well as our general functional ability.

 

We would welcome it very much if you could agree to a contractual amendment and anticipate your quick reply.

 

Yours truly,

 

European Advanced Superconductors GmbH & Co. KG

 

	
/s/   Burkhard Prause
    	
 
    	
/s/   Peter Unvericht
    
	
 
    	
 
    	
 
    
	
Dr. Burkhard   Prause
    	
 
    	
Peter   Unvericht
    
	
Manager
    	
 
    	
Commercial   Director
    


 

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