lmi10k031509ex2.htm


    Exhibit 10.2

    
 

    LEASE
AGREEMENT

     

    THIS
LEASE AGREEMENT (“LEASE”) ENTERED INTO ON THIS _7th_
DAY OF JANUARY, 2006, BY AND BETWEEN INMOBILIARIA LA RUMOROSA, S.A. DE C.V., HEREIN REPRESENTED BY PABLO
CHARVEL OROZCO (HEREINAFTER REFERRED TO AS “LESSOR”) AND IVEMSA S.A. DE C.V.,
HEREIN REPRESENTED BY SERGIO TAGLIAPIETRA NASSRI, (HEREINAFTER REFERRED TO AS
“LESSEE”), BINDS THE PARTIES PURSUANT TO THE FOLLOWING RECITALS AND
CLAUSES.

     

    RECITALS

     

    
      	
               
      

            	
              The
      Lessor, through its legal representative,
  states:

            


    

     

    
      	
              A.

            	
              That
      Lessor is a corporation duly organized and existing under the laws of the
      United Mexican States.

            


    

     

    
      	
              B.

            	
              That
      Lessor is duly represented herein by Pablo Charvel Orozco, who has full
      power and authority to execute this Agreement on its behalf, as evidenced
      by the public instrument attached hereto as Exhibit
      A.  Furthermore, Pablo Charvel Orozco hereby represents
      that such authority has not been limited nor revoked in any manner
      whatsoever.

            


    

     

    
      	
              C.

            	
              That
      as evidenced by public instrument number 3,807, dated January 6, 1997,
      granted before Mr. Horacio Carvajal Moreno, Notary Public Number 46, for
      the Judicial District of Tlalnepantla, State of Mexico, Mexico, which was
      duly recorded at the Public Registry of Property and Commerce of Mexicali,
      Baja California, Mexico, under record number 17,617, Civil Section, Lessor
      is the owner in fee simple of Lot Number Ninety-Eight (“Lot 98”) of
      Colonia Rivera, located in the city of Mexicali, Baja California, Mexico,
      which has a surface area of five (5) hectares approximately.  A
      legal description of Lot 98 is attached hereto as Exhibit B,
      which has a total surface area of 45,566.011 square
      meters.  That Lessor has the authorization to develop the
      Calafia Industrial Park (hereinafter referred to as the “Park”) granted by
      the Urban Control Department of Municipal Government issued on December
      18, 1997.

            


    

     

    
      	
              D.

            	
              Lessor
      leases to Lessee a portion of an industrial building (the “Building”)
      located within the Park and commonly known as Av. Eucalipto, #2351, Col.
      Rivera, Modulo Cy D, C.P. 21259, Mexicali, Baja California, Mexico as depicted on
      Exhibit C
      attached hereto (hereinafter “Leased
Premises”).

            


    

     

    The
Lessee, through its representative, states:

     

    
      	
              A.

            	
              That
      Lessee is a corporation duly organized and existing in accordance with the
      laws of the United Mexican States.

            


    

     

    
      	
              B.

            	
              That
      Lessee is duly represented by Sergio Taglapietra Nassri, who has full
      power and authority to execute this Agreement on its behalf, as evidenced
      by the public instrument attached hereto as Exhibit D
      Furthermore, Sergio Taglapietra Nassri hereby represents that such
      authority has not been limited nor revoked in any manner
      whatsoever.

            


    

     

    
      	
              C.

            	
              That
      Lessee wishes to enter into this Lease in order to lease the Leased
      Premises from the Lessor under the terms and conditions herein set
      forth.

            


    

     

    
      	
               
      

            	
              Having
      stated the foregoing, the parties agree on the
  following:

            


    

     

    ARTICLES:

     

    ARTICLE
1.          LEASE.

     

    
      	
              1.1

            	
              Subject
      to the terms and conditions set forth herein, the Lessor hereby agrees to
      lease to Lessee and Lessee hereby agrees to lease from Lessor the Leased
      Premises.  Lessee shall also have the right to (i) the exclusive
      use of forty-eight (48) parking spaces located the parking area adjacent
      to the Building and (ii) the non-exclusive use together with other tenants
      in the Park of all common areas located in the
  Park.

            


    

     

    
      	
              1.2

            	
              Lessor
      represents and warrants that the Leased Premises is comprised of 23,238
      usable square feet and the improvements located within the Leased Premises
      have been constructed in accordance with the specifications set forth in
      Exhibit G
      attached hereto and the plans and specifications prepared by Lessor dated
      April 5, 2005.  Lessor further represents and warrants that (i)
      the Building shall contain no structural defects or defective systems;
      (ii) the Building systems shall be in proper working order and condition
      and that the Building and the Leased Premises shall be in compliance with
      all applicable laws, ordinances, rules, regulations and codes; (iii) the
      use of the Leased Premises by Lessee for the purposes described in Article
      3 are permissible under all applicable zoning codes, laws, rules and
      regulations; (iv) the Building is served by all utilities necessary for
      Lessee’s intended use of the Leased Premises as described in Article 3 and
      such utilities are adequate with respect to service and capacity for
      Lessee’s intended use of the Leased Premises as described in Article 3;
      and (v) the Building, the Leased Premises, and Lessor’s Work (as
      hereinafter defined) are free from all defects, patent, latent or
      otherwise.

            


    

     

    ARTICLE
2.           OWNERSHIP OF THE LEASED
PREMISES.

     

    
      	
              2.1

            	
              Lessor
      represents and warrants that Lessor is the sole owner and has clear and
      marketable title to the Building and the Leased Premises and the common
      areas contiguous thereto, and warrants that Lessee, upon Lessee’s payment
      of rent and compliance with Lessee’s obligations hereunder, Lessee shall
      have the quiet enjoyment of the Leased Premises.  Lessor and
      Lessee agree that, as provided by the Civil Code of the State of Baja
      California, this Lease shall survive any foreclosure of any lien or any
      mortgage on the Leased Premises and that any default in payment of any
      such lien or mortgage shall in no way prejudice the terms of this Lease,
      the rights of Lessee hereunder, or any extensions thereof. Any amendments
      to such mortgages or any new mortgages on the Leased Premises shall
      contain a provision acknowledging the existence and duration of this Lease
      and Lessee’s right to extend the term of this Lease pursuant to Article 21
      hereof and the options to lease additional space as set forth in Articles
      22 and 23 hereof.

            


    

     

    
      	
              2.2

            	
              Lessor
      represents that the rules and regulations, attached hereto as Exhibit E (the
      “Park Rules”) are legally binding against the Park and, thus, the Leased
      Premises.  Lessor and Lessee acknowledge the existence of the
      Park Rules and understand the binding nature of the same upon anyone
      claiming an interest in Lot 98.

            


    

     

    ARTICLE
3.           USE OF THE LEASED
PREMISES

     

    The
purpose for which the Lessee shall use the Leased Premises shall be as follows:
general office use and the manufacture, warehousing, and distribution of
aircraft related products and services, including, but not limited to, heat
treating, forming, cutting, repair, engineering, sales, product demonstration,
training of customers and employees, ancillary storage, parking of cars and all
other uses incidental and related to a manufacturing, warehouse and office
facility, and for no other purposes without the written consent of the Lessor,
which consent shall not be unreasonably withheld or delayed.  During
the Term (as hereinafter defined) of this Lease, the Lessee shall make its best
efforts to not do or permit anything to be done on or about the Leased Premises,
which shall in any way conflict with all applicable laws, statutes, ordinances,
or governmental rules.

     

    ARTICLE
4.           TERM OF THE
LEASE.

     

    
      	
              4.1

            	
              The
      term of this Lease (the “Term”) shall commence on February 1, 2006 (“Lease
      Commencement Date”) and shall expire seventy-four (74) months
      thereafter.  The Leased Premises shall be delivered to Lessee on
      the Lease Commencement Date broom clean and free of personal property of
      others and Lessor shall have completed Lessor’s Work in accordance with
      the terms and provisions set forth in Exhibit G,
      attached hereto and incorporated herein by
  reference.

            


    

     

    
      	
              4.2

            	
              Lessee
      may terminate this Lease prior to the expiration of the Term, provided
      however, that Lessee previously fulfills each and all of the following
      conditions: (i) that Lessee serves and provides Lessor written notice
      thereof at least six months prior to the proposed date of termination;
      (ii) that Lessee together with the mentioned notice, delivers and pays to
      Lessor as consideration for such early termination, an amount equivalent
      to the sum of all monthly rental payments (based on the then current
      monthly rent) for the remaining period of the Lease Term discounted at a
      rate of 7%.

            


    

     

    
      	
              4.3

            	
              The
      parties agree that the Lessee may commence its occupation of the Leased
      Premises on December 20, 2005
      (the “Early Occupation Period”) with no obligation to pay rent to Lessor
      until such time as specified in Section 5.1 below.  Lessor shall
      provide Lessee with temporary office space to accommodate seven (7)
      employees of Lessee as needed by Lessee during the Early Occupation
      Period.

            


    

     


    ARTICLE
5.           RENTAL AND TERMS AND
CONDITIONS OF PAYMENT.

     

    
      	
              5.1

            	
              Commencing
      on April 1, 2006 (the “Rent Commencement Date”), Lessee shall pay rent on
      a monthly basis to Lessor, without any formal demand from Lessor, for the
      first year of the Lease Term, in an amount equal to the rate of $0.39 per
      square foot multiplied by the usable square feet of the Leased Premises as
      set forth in Article 1 (it being the intention of the parties that Lessee
      shall be entitled to a rental abatement for the months of February and
      March of 2006).  In addition to the rental rate set forth in
      this Section 5.1, Lessee shall also be responsible for the monthly
      maintenance fee as set forth in Section 8.3.  During the
      remaining five (5) years of the Term and any renewal terms, Lessee shall
      pay rent on a monthly basis in an amount calculated in accordance with
      Section 5.2 below.

            


    

     

    
      	
              5.2

            	
              On
      each anniversary of the Lease Commencement Date during the Term and any
      Extension Period, to the extent such option shall be exercised, monthly
      rent shall be increased at the rate of three percent (3%) over the monthly
      rent for the prior year and shall be as
follows:

            


    

     

    
      
        
          
            
              
                
                  
                    	 
      	
                            Monthly Rental Payment

                          
	 
      	
                            (Without
      Maintenance Fee)

                          
	
                            Year
      1

                          	
                            $9,062.82

                          
	
                            Year
      2

                          	
                            $9,334.70

                          
	
                            Year
      3

                          	
                            $9,614.74

                          
	
                            Year
      4

                          	
                            $9,903.18

                          
	
                            Year
      5

                          	
                            $10,200.28

                          
	
                            Year
      6

                          	
                            $10,506.29

                          


                  

                

              

            

          

        

      

    

     

    
      	
              5.3

            	
              Lessee
      shall pay rent to Lessor at the address specified in Section 24 below in
      monthly installments, in advance, on or prior to the tenth (10th)
      day each calendar month, throughout the Term without deduction, offset,
      prior notice, or demand, in lawful money of the United
    States.

            


    

     

    
      	
              5.4

            	
              The
      Lessee shall pay the Value Added Tax which may be applicable to the
      monthly rent payment, and the Lessor shall issue the corresponding invoice
      simultaneously with such payment, containing all requirements of Fiscal
      Law, evidencing the payment of rent and the Value Added Tax by
      Lessor.

            


    

     

    
      	
              5.5

            	
              In
      the event Lessee does not pay rent on or prior to the tenth (10th)
      day of the month, Lessee shall pay Lessor interest on the unpaid amount at
      the per annum rate of eighteen percent (18%).  Such interest
      shall continue to accrue until such time payment has been made in full by
      Lessee.

            


    

     


    ARTICLE
6.           TAXES AND
UTILITIES.

     

    
      	
              6.1

            	
              The
      Lessee shall, as of the Lease Commencement Date and during the Term of
      this Lease, pay and timely discharge all electrical service charges,
      natural gas service charges, if any, telephone service charges and water
      and sewer charges.  All license and permit fees and other
      Federal, State or Municipal charges imposed upon the Leased Premises shall
      be paid by Lessor during the Lease Term.  Notwithstanding
      anything to the contrary set forth herein, Lessor shall be responsible for
      the payment of all real estate property taxes assessed against the Leased
      Premises.

            


    

     

    
      	
              6.2

            	
              Lessor,
      at Lessor’s sole cost and expense, shall install or have installed all
      water, sewer and electrical and telephone lines for the general supply of
      water, sewer, electrical and telephone service to the Leased Premises, in
      accordance with all federal, state and local regulations, and shall cause
      the installation of the same to be accepted and approved by the Federal,
      State, or local authorities having jurisdiction over all streets abutting
      the Leased Premises.  Lessee shall contract and pay for all
      utilities it shall use.  Lessor, at Lessor’s sole cost and
      expense, shall have further installed all lighting fixtures, a power
      station and air conditioning in the Leased Premises for use by Lessee in
      accordance with Exhibit
      G.

            


    

     

    
      	
              6.3

            	
              It
      is agreed and understood by the parties that Lessor will use its best
      efforts to assist Lessee to contract all utility services necessary for
      Lessee’s operations in the Leased Premises.  Lessee shall
      contract for such utility services in Lessee’s name, with the
      understanding that the contracting fees and the fees for the supply of
      such utilities will be paid by
Lessee.

            


    

     

    ARTICLE 7.
          ASSIGNMENT-SUBLEASING

     

    The
Lessee shall not transfer, mortgage, pledge or otherwise encumber this Lease, or
any interest herein, without the prior written consent of the Lessor, which
consent shall not be unreasonably withheld or delayed.  Lessee shall
have the right to sublease all or a portion of the Leased Premises or to assign
this Lease with the prior written consent of the Lessor, but any such subletting
or assignment shall not relieve Lessee or Guarantor (as hereinafter defined) of
its obligations hereunder including those pertaining to the payment of rent,
unless otherwise agreed in writing by the parties.  Notwithstanding
anything to the contrary set forth herein, Lessee shall have the right, without
the prior written consent of Lessor, to assign the Lease or sublet the Leased
Premises to Guarantor or to any affiliate of Guarantor, to any successor of
Guarantor resulting from a merger, consolidation or other corporate
restructuring, to any entity under the common control of Guarantor, or to any
partner or joint venturer of Guarantor.  Despite any such assignment
or subletting, Lessee shall at all times remain liable for the payment of rent
and for compliance with all of Lessee’s other obligations under the terms,
provisions and covenants of this Lease.

     

    ARTICLE
8.           MAINTENANCE AND REPAIRS;
ENVIRONMENTAL MATTERS

     

    
      	
              8.1

            	
              Lessor,
      at Lessor’s sole cost and expense, shall be solely responsible for the
      prompt maintenance (including preventive maintenance) and repair of all
      structural components and systems of the Building, including, but not
      limited to, the roof and gutters, columns, floor slab, exterior walls,
      foundations, heating and air conditioning systems, plumbing systems,
      mechanical systems, electrical systems, sprinkler systems, sewer systems
      and paved areas on the land (i.e., parking lots, walkways, roadways and
      driveways).  It is agreed and understood by the Lessee that none
      of its employees, contractors, dependents or representatives may get on
      the roof for any work whatsoever without the prior authorization from the
      Lessor, which may not be unreasonably
withheld.

            


    

     

    
      	
              8.2

            	
              Lessee
      shall be responsible to maintain the Leased Premises by providing proper
      janitorial services and making routine and ordinary repairs, restoration,
      and minor replacements to the Leased Premises that are not otherwise the
      responsibility of Lessor under Sections 8.1 and 8.3.  Lessor
      shall not be called upon to make any repairs caused by improper use or
      negligent acts of the Lessee, its employees, agents or
      visitors.

            


    

     

    
      	
              8.3

            	
              Lessor
      shall be responsbile for the maintenance and cleanliness of streets,
      common areas of the Park, as well as for 24-hour security and all other
      industrial park services, including, but not limited to, lawn and
      shrubbery, maintenance, parking lot maintenance, walkway maintenance,
      common area lighting, trash removal, exterior exterminating, exterior
      painting and roof repairs.  On or prior the tenth (10th) day of each
      month of the Term, Lessee shall pay to Lessor a monthly maintenance fee of
      one cent ($0.01 U.S.) per usable square foot of Leased Premises.  The
      usable square footage of the Leased Premises is set forth in Article
      1.

            


    

     

    
      	
              8.4

            	
              Lessor
      shall be fully responsible for the expense and liability associated with
      any Hazardous Substances (as hereinafter defined) which are now present or
      which may in the future come to be located (whether by migration through
      soil or groundwater or otherwise) on or under Leased Premises or Lot 98,
      excepting only those Hazardous Substances which the Lessor can demonstrate
      are the result of an active spill by Lessee during Lessee’s operations at
      the Leased Premises.  In addition, Lessor hereby agrees to pay,
      discharge, indemnify, release, save and hold harmless Lessee and Lessee’s
      employees, directors, officers, shareholders, parent companies and agents
      and each of the foregoing parties’ respective successors and assigns
      (individually, a “Lessee Indemnitee” and collectively, the “Lessee
      Indemnities”) from and against all losses, claims, liabilities, damages
      (including without limitation incidental and consequential damages and
      lost profits), suits, proceedings, assessments or other actions which may
      be asserted against or incurred by a Lessee Indemnitee, arising out of or
      related to the actual or alleged presence or migration of Hazardous
      Substances on, under, from or into the Leased Premises or Lot
      98.

            


    

     

    
      	
              8.5

            	
              For
      purpose of this Agreement, “Hazardous Substances” means any chemical,
      compound, material mixture, living organism or substance that is now or
      hereafter defined or listed in or otherwise classified or regulated in any
      way pursuant to, the  environmental laws of the City of
      Mexicali, State of Baja California, México as a “hazardous waste, “
      hazardous substances,” “hazardous material,” “extremely hazardous waste,”
      “infectious waste,” “toxic substance,” “toxic pollutant” or any other
      formulation intended to define, list or classify substances by reason of
      deleterious properties, including without limitation, ignitability,
      corrosives, reactivity, carcinogenicity, or toxicity, such materials,
      including without limitation, oil, waste oil, petroleum, waste petroleum,
      polychlorinated biphenyls (PCBs), asbestos, radon, natural gas, natural
      gas liquids, liquefied natural gas, or synthetic gas usable for fuel (or
      mixtures of natural gas and such synthetic
gas).

            


    

     

    
      ARTICLE
9.           INSURANCE.

    

     

    
      	
              9.1

            	
              As
      of the Lease Commencement Date and throughout the Lease Term, Lessor, at
      Lessor’s sole cost and expense, shall insure the Leased Premises and the
      Building against any (i) loss or damage by fire; (ii) loss or damage from
      all other risks, hazards, or casualties covered by an “Extended Coverage
      Endorsement” in the State of Baja California, Mexico; and (iii) loss for
      flood; as well as such other risks as a reasonably prudent owner of
      similar industrial buildings in the locality where the Building is located
      would normally insurance against.  Insurance obtained by Lessor
      pursuant to the terms hereof shall provide for payment in the amount of
      the full insurable value (expressed in U.S. Dollars, but payable in
      Mexican Currency at the then present rate of exchange) of the Leased
      Premises, Building, and other improvements or infrastructure located in
      the Park. The “Extended Coverage Endorsement” shall include but not be
      limited to insurance against risks such as: lightning, explosion,
      hurricane and wind damage, hail, airplane and other vehicles, smoke,
      earthquakes, strikes, riots, civil disorders & vandalism. The
      insurance required to be provided by the Lessor under this Article 9 shall
      be purchased by the Lessor on an annual basis during the Term of this
      Lease, effective upon the Lease Commencement Date.  Lessor shall
      deposit certificates of such required insurance with Lessee prior to the
      Lease Commencement Date.  Said certificates shall evidence that
      the insurance is in force and state that such policy or policies have been
      endorsed to provide that they will not be cancelled or materially altered
      with respect to the Leased Premises except after thirty (30) days’ written
      notice to Lessee.  Lessee and Guarantor will be named as
      additional insureds and/or loss payees in any such policies, as
      appropriate.

            


    

     

    
      	
              9.2

            	
              Lessee,
      at its sole cost and expense, shall insure the contents of the Leased
      Premises, and maintain general public liability insurance against claims
      for personal injury, death or property damage occurring upon or about the
      Leased Premises, in an amount not less than One Million U.S. Dollars
      ($1,000,000.00).

            


    

     

    
      	
              9.3

            	
              The
      policies obtained by Lessee pursuant to paragraph 9.2 shall provide that
      no cancellation thereof shall be effective until Lessor has provided with
      at least thirty (30) days prior written notice.  In addition,
      within fifteen (15) days of the Lease Commencement Date, the Lessee shall
      provide the Lessor with certificates evidencing compliance with the
      requirements of this Article 9.

            


    

     

    
      	
              9.4

            	
              Rental
      Insurance:  During the Lease Term, as same may be extended,
      Lessor, at Lessor’s sole cost and expense, shall purchase a rent insurance
      policy which shall provide for the payment of rents during any period of
      reconstruction or repair of the Leased Premises during periods of rental
      abatement where the Lessee is unable to utilize the Leased Premises for
      Lessee’s intended purposes as described in Article
  3.

            


    

     

    
      	
              9.5

            	
              Waiver
      of Subrogation.  The parties release each other, and their
      respective authorized representatives, from any claim for damage to any
      person or to the Leased Premises or to the fixtures, personal property, or
      improvements located in the Leased Premises caused by or as a result of
      any damage insured against under any insurance policies carried by the
      parties.  All policies of insurance maintained by Lessor and
      Lessee pursuant to the terms set forth herein shall provide that the
      insurance company waives all right to recovery by way of subrogation
      against either party in connection with any damage covered by any policy
      maintained by either Lessor or Lessee.  If, through reasonable
      efforts, a party hereto is unable to obtain such waiver of subrogation,
      such party shall name the other party as an additional insured under its
      policy in order to accomplish the intent of this
  provision.

            


    

     

    ARTICLE
10.          DESTRUCTION

     

    
      	
              10.1

            	
              In
      the event of damage to or destruction of the Building or any improvements
      within the Leased Premises, Lessor will promptly, and at Lessor’s sole
      cost and expense, make such repairs, restoration or rebuilding to the
      extent that is necessary to provide the Lessee with a premises of equal
      utility and design and construction quality to that which existed prior to
      such damage or destruction; and this Lease shall remain in full force and
      effect during the time such repairs, restoration or rebuilding are being
      effected.  During the period of reconstruction and repair,
      Lessee’s obligation to pay rent shall be abated in proportion to the
      amount of the Leased Premises rendered untenantable (utilizing the same
      per square foot rate used to calculate the regular monthly rent prior to
      the casualty) until the Leased Premises are repaired or
      restored.

            


    

     

    
      	
              10.2

            	
              In
      the event that such repairs, restoration or rebuilding cannot be
      accomplished within one hundred and fifty (150) days after the occurrence
      of the damage or destruction or in the event that Lessor fails to commence
      repair and restoration of any such damage or casualty within thirty (30)
      days of the occurrence of the damage or casualty, Lessee may, at its
      option and without further liability hereunder, terminate this Lease
      effective immediately upon written notice to the
      Lessor.  Notwithstanding the foregoing, if fifty-percent (50%)
      or more of the value of the improvements on the Leased Premises are lost
      due to such destruction or damage (a) during the last year of the original
      Lease Term or (b) during the last year of any extension elected by Lessee
      in accordance with Article 21 below; Lessor may elect to terminate this
      Lease effective immediately upon written notice delivered to the Lessee
      within thirty (30) days of such damage, unless otherwise negotiated with
      Lessee.

            


    

     

    ARTICLE
11.
          SURRENDER

     

    
      	
              11.1

            	
              Lessee
      shall, on the last day of the Term of this Lease including all extensions
      thereof, surrender and deliver the Leased Premises into the possession and
      use of the Lessor without delay, in good order, condition and repair,
      except for normal wear and tear due to normal use and the passage of time,
      and except for damage caused by fire or other casualty.  For
      purposes hereof, the parties shall, within a term of one (1) month prior
      to the end of the Lease Term, effect a joint inspection of the Leased
      Premises in order to determine the condition of the Leased
      Premises.

            


    

     

    
      	
              11.2

            	
              All
      signs, inscriptions, canopies and installations of like nature made by
      Lessee shall be removed at or prior to the expiration of the term of this
      Lease.

            


    

     

    
      	
              11.3

            	
              All
      furniture, trade fixtures and business equipment installed by Lessee shall
      remain the property of the Lessee and may be removed by Lessee at any time
      during or at the end of the Lease Term.  Lessee shall, at its
      own expense, repair all damage to the Leased Premises resulting from the
      installation or removal of its furniture, trade fixtures and business
      equipment.  All furniture, trade fixtures, or business equipment
      no so removed will conclusively be deemed to have been abandoned by Tenant
      and may be appropriated sold, stored, destroyed, or otherwise disposed of
      by Lessor without notice to Lessee.

            


    

     

    ARTICLE
12.          HOLDOVER

     

    In the
event this Lease is not extended pursuant to Article 21 prior to the termination
date, the Lessee shall, at the termination of the Lease by lapse of time or
otherwise, yield up immediate possession of the Leased Premises to
Lessor.  The failure of Lessee to relinquish the Leased Premises on
such date will result in the Lessee being deemed a month-to-month tenant having
the same obligations as those existing prior to the expiration except that
monthly base rent shall equal the sum of one and one-half (1 1⁄2) months’ rent (as
calculated based on the rent paid during the last year of the Term, increased by
three percent (3%) in accordance with Section 5.2) plus other charges payable
pursuant to the terms of this Lease and such tenancy shall be subject to
termination by either party upon one month’s prior written notice.

     

    ARTICLE
13.
          LESSOR’S RIGHT TO PERFORM
LESSEE’S
COVENANTS.

     

    If Lessee
shall at any time fail to perform any one or more of its agreements made in this
Lease, Lessor, after ten (10) days written notice to Lessee (or without notice
in the case of an emergency) and without waiving or releasing Lessee from any of
its obligations contained in this Lease, may but shall be under no obligation to
perform any act to be performed by Lessee as provided in this Lease, and may
enter upon the Leased Premises for that purpose and take all such actions
thereon as may be necessary therefore.  All sums paid by Lessor and
all costs and expenses incurred by Lessor in connection with the performance of
any such obligation of Lessee shall be payable by Lessee to Lessor on demand
upon presentment.

     

    ARTICLE
14.
          LESSEE’S RIGHT TO PERFORM
LESSOR’S
COVENANTS.

     

    If Lessor
shall at any time fail to perform any one or more of its agreements made in this
Lease, Lessee, after ten (10) days written notice to Lessor (or without notice
in the case of an emergency) and without waiving or releasing Lessor from any of
its obligations contained in this Lease, may but shall be under no obligation to
perform any act to be performed by Lessor as provided in this Lease, and may
take all such actions thereon as may be necessary therefore.  All sums
paid by Lessee and all costs and expenses incurred by Lessee in connection with
the performance of any such obligation of Lessor, shall be payable by Lessor to
Lessee on demand upon presentment.

     

    ARTICLE
15.
          ENTRY ON THE LEASED PREMISES
BY LESSOR.

     

    
      	
              15.1

            	
              So
      long as Lessor complies with the terms of Sections 15.2 and 15.3 below,
      Lessee shall permit Lessor or its authorized representatives to enter the
      Leased Premises during Lessee’s usual business hours for the purpose of
      inspecting the same and performing any work therein that may be required
      of Lessor pursuant to the terms of Articles 8, 10 and 13 of this Lease,
      without interfering with Lessee’s activities within the Leased
      Premises.

            


    

     

    
      	
              15.2

            	
              Lessor
      shall have the right to enter the Leased Premises at all reasonable times
      during Lessee’s usual business hours for the purpose of showing the same
      to prospective purchasers of the Leased Premises and within a six months
      period prior to the expiration of this Lease, or any extension thereof,
      for the purpose of showing the same to prospective lessees, without
      interfering with Lessee’s
activities.

            


    

     

    
      	
              15.3

            	
              Except
      in case of emergency, the Lessor shall at all times give twenty-four (24)
      hours advance written notice to the Lessee before entering the Leased
      Premises and the Lessee shall have the right to escort any representatives
      of the Lessor and prospective clients about the Leased
      Premises.

            


    

     

    
      ARTICLE
16.           SECURITY DEPOSIT AND
GUARANTIES.

       

    

    
      	
              16.1

            	
              Lessee
      shall deposit with Lessor the sum of Ten Thousand Dollars
      ($10,000.00)  as a “Security Deposit” within ten (10) days after
      the execution of this Lease. The Security Deposit shall be held by Lessor
      as security for the faithful performance by Lessee of all the terms of
      this Lease.  In the event of any default by Lessee in Lessee’s
      performance hereunder, Lessor may, but is not obligated to, apply said sum
      or any part thereof toward the curing of any such default and/or toward
      compensating Lessor for any loss or damage arising from such
      default.  Upon the expiration or earlier termination of the
      Lease and Lessee’s surrender of the Leased Premises, Lessor shall return
      the Security Deposit to Lessee no later than ten (10) calendar days after
      the termination of the Lease so long as Lessee is not in default under the
      Lease or otherwise liable to
Lessor.

            


    

     

    
      	
              16.2

            	
              Lessee
      shall deliver to the Lessor, a guaranty from Leonard’s Metal, Inc., a
      subsidiary of LMI Aerospace, Inc. (“Guarantor”) for the payment of rent
      due hereunder.  The form of “Guaranty” is attached hereto as
      Exhibit
      F.  Such Guaranty shall be delivered to Lessor no later
      than ten (10) business days after the date of execution of this
      Lease.

            


    

     

    ARTICLE
17.
          SUBORDINATION.

     

    Lessee
agrees, at the request of Lessor, to subordinate this Lease (including any
extensions) to any mortgage or security interest placed upon the Leased
Premises, provided that the holder of such mortgage or security interest agrees
not to disturb the exclusive possession and other rights of Lessee under this
Lease.  In the event of acquisition of title by said holder of such
mortgage or security interest through foreclosure proceedings or otherwise, and
as consideration for the Subordination Agreement of Lessee, the holder of such
mortgage or security interest agrees to accept Lessee under this Lease and to
perform the Lessor’s obligations hereunder and Lessee agrees to recognize the
holder of such mortgage or security interest, or any other person acquiring
title to the Leased Premises, as Lessor hereunder; provided, however that in no
event shall the same relive Lessor of its obligations
hereunder.  Lessor agrees to provide Lessee promptly after execution
of this Lease with executed commercially reasonable non-disturbance agreements
in favor of Lessee from any and all ground lessors, mortgage holders and other
lien holders now in existence (or that come into existence at any time prior to
the expiration of the Lease) in a form reasonably satisfactory to
Lessee.  In the event Lessor fails to deliver to Lessee such executed
non-disturbance agreements from all such parties within thirty (30) days after
the date of this Lease (or within thirty days after the same come into existence
during the term of the Lease), Lessee shall have the option to terminate this
Lease effective immediately upon written notice to Lessor; and neither Lessee
nor Lessor shall have any further liability or obligation under this
Lease.  Lessee and Lessor agree to execute and deliver any other
appropriate instruments necessary to carry out the agreements contained in this
Article 17.

     

    ARTICLE
18.          EVENTS OF
DEFAULT.

     

    
      	
              18.1

            	
              The
      occurrence of any one or more of the following events shall constitute an
      “Event of Default” of this Lease by
Lessee:

            


    

     

    
      	
               
      

            	
              (a)
      The failure by Lessee to make any payment of rent on or prior to the tenth
      (10th)
      of each month or any other payment required of Lessee under this Lease
      when due.  Upon such failure by Lessee to make its timely
      payment of rent, Lessor shall send a written statement to Lessee and
      Guarantor indicating the default and provide Lessee ten (10) calendar days
      to cure the default.  Lessee’s failure to cure the default
      described herein, or Guarantor’s failure to cure such default of Lessee,
      shall be considered an Event of Default without further notice, and Lessor
      may exercise its remedies as enumerated herein.  After Lessor
      has provided Lessee and Guarantor three such notices at any time during
      the Lease Term, Lessor shall be relieved of the notice obligations imposed
      upon it by this sub-paragraph (a) of Section 18.1, and Lessee shall no
      longer have the default cure rights enumerated
  herein;

            


    

     

    
      	
               
      

            	
              (b)  Except
      as provided in sub-paragraph 18.1(a) above, the failure by Lessee to
      observe or perform any of the covenants, conditions or provisions of this
      Lease, where such Event of Default shall continue for a period of thirty
      (30) calendar days after receipt by Lessee and Guarantor of written notice
      thereof from Lessor; provided, however, that if the nature of Lessee’s
      default is such that it cannot be cured solely by payment of money and
      more than thirty (30) calendar days may be reasonably required for such
      cure, then Lessee shall not be deemed to be in default if Lessee or
      Guarantor shall commence such cure within such thirty (30) calendar day
      period and thereafter shall diligently prosecute such cure to
      completion;

            


    

     

    
      	
               
      

            	
              (c)

            	
              (i) The
      making of any general arrangement or any assignment by the Lessee for the
      benefit of creditors;

            


    

     

    (ii) The
filing by or against Lessee of a petition to have Lessee adjudged an insolvent,
or a petition of reorganization or arrangement under any law relating to
insolvency (unless such petition is dismissed within ninety (90) days of
filing);

     

    (iii) The
appointment, execution or other judicial seizure of all or substantially all of
Lessee’s assets (unless such attachment, execution or judicial seizure is
dismissed within ninety (90) days from the date in which this
occurs.)

     

    (iv) The
attachment, execution or other judicial seizure of all or substantially all of
Lessee’s assets (unless such attachment, execution or judicial seizure is
dismissed within ninety (90) days from the date in which this
occurs).

     

    
      	
              18.2

            	
              Upon
      any Event of Default, and except as otherwise provided herein, Lessor, in
      addition to other rights or remedies it may have, shall have the right to
      terminate this Lease ten (10) days after Lessee receives Lessor’s written
      notice of termination.

            


    

     

    
      	
              18.3

            	
              Lessor
      will be in default under the terms of this Lease if Lessor shall fail to
      perform or observe any of its obligations contained in this Lease, and
      such failure continues for a period of ten (10) days after Lessee shall
      have given Lessor written notice specifying such failure which may be
      cured solely by the payment of money, and thirty (30) days after Lessee
      shall have given Lessor written notice specifying such failure which may
      not be cured solely by the payment of money.  In the event of a
      default by Lessor which Lessor fails to cure after notice thereof, Lessee
      shall have all rights and remedies available to it under applicable
      law.  Lessee, may in its sole discretion, cure such
      nonperformance and offset against monthly rent payments due Lessor, such
      provable damages owing Lessee by
Lessor.

            


    

     

    ARTICLE
19.
          INDEMNIFICATION.

     

    With
regard to the Leased Premises, Lessor agrees to indemnify, defend and save
Lessee, its agents, representatives and employees against, and hold Lessee, its
agents, representative and employees harmless from any and all demands, claims,
causes of action, fines, penalties, damages (including consequential damages),
losses, liabilities, judgments, and expenses (including, without limitation,
attorneys’ fees and court costs) for personal injury or property damage which
may be made against the Lessee during the Lease Term, and which arise out of the
negligent or tortious conduct of the Lessor, its servants, employees, agents,
assignees, representative, licensees or invitees.  Lessee agrees to
indemnify, defend and save Lessor, its agents, representatives and employees
against and hold Lessor, its agents, representatives and employees harmless from
and all demands, claims, causes of action, fines, penalties, damages (including
consequential damages), losses, liabilities, judgments, and expenses (including,
without limitation, attorneys’ fees and court costs) for personal injury or
property damage which may be made against Lessor during the Lease Term, and
which arise out of the negligence or tortious conduct of the Lessee, its
servants, employees, agents, assignees, representatives, licensees or
invitees.

     

    ARTICLE
20.          QUIET
ENJOYMENT.

     

    Lessor
covenants that the Lessee shall, upon paying the rent and observing the other
covenants and conditions contained herein, have peaceful and quiet enjoyment of
the Leased Premises during the Lease Term, without hindrance, ejection or
molestation by the Lessor, any person or persons claiming under the Lessor, or
any other lessee of the Lessor.

     

    ARTICLE
21.          RENEWAL OF
LEASE.

     

    Lessee
shall have the right to extend the Term of the Lease Agreement upon the terms,
covenants, and conditions set forth herein, for one (1) additional period of
five (5) years (“Extension Period”).  The monthly rent for each year
of the Extension Period shall be calculated in accordance with Section
5.2.  The option shall be exercised at the sole discretion of the
Lessee in writing, and shall be delivered to Lessor at least four (4) months
prior to the expiration of the then current Lease Term.  It is agreed
and understood by the Lessee that in the event the option for the Extension
Period is exercised, Lessee shall deliver a Guaranty in favor of Lessor in a
substantially similar form to the Guaranty attached hereto as Exhibit F executed by
Leonard’s Metals, Inc. or such other related entity as agreed by the
parties.

     

    ARTICLE
22.          OPTION FOR MODULE
B

     

    During
the first year of the Term of the Lease, Lessee shall have an option to expand
the Leased Premises to include Module B of the Building as shown on Exhibit C attached
hereto (“Module B”) (it being the understanding of the parties that the new
monthly rental payment shall be calculated by multiplying the rental rate set
forth in Section 5.1 by the square footage of the Leased Premises taking into
account the square footage of Module B).  After the first year of the
Lease Term, Lessee shall have a right of first refusal for Module B (it being
the intent of the parties that Lessee shall have the right to match any offer
for ten (10) days after receipt of written notice from Lessor of a bonafide
offer from a party unrelated to Lessor to lease Module B).  Should
Lessee decide to exercise its right of first refusal on the additional module,
Lessee shall provide Lessor with written notice of such decision within ten (10)
days after Lessee’s receipt of notice of the initial offer from
Lessor.  Should Lessee decide to exercise its option to lease Module B
during the Term hereof, Lessor and Lessee shall mutually agree to either enter
into either an amendment to this Lease or a new lease which redefines the Leased
Premises to include Module B and sets forth the new monthly rental
rate.  Notwithstanding the foregoing, any new lease or amendment to
this Lease entered into between the parties pursuant to this Article 22 shall
include language which sets forth a term or extends the Term for a period of at
least five (5) years commencing on the execution date of the amendment or the
new lease, which shall occur at least ninety (90) days after Lessor’s receipt of
written notice from Lessee of Lessee’s desire to exercise its option to lease
Module B.  It is agreed by the parties that, in the event the parties
enter into a new lease pursuant to the terms of this Article 22, Lessee shall
cause a guaranty, similar to the Guaranty granted to Lessor pursuant to Exhibit F hereto, be
granted to Lessor.

     

    ARTICLE
23.          EXPANSION.

     

    If Lessee
requires more industrial space in addition to Module B or in the event Lessee
does not exercise its option to lease Module B, Lessor agrees to use its best
efforts to provide the additional space adjacent to the Leased Premises as
depicted on Exhibit H attached hereto and incorporated herein (the “Adjacent
Space”).  If the Adjacent Space cannot be delivered, Lessor shall
provide another building (owned by Lessor) to provide the total industrial space
required by Lessee.  If Lessee agrees to move into another building
owned by Lessor, Lessor agrees to (i) reimburse Lessee for all moving expenses
incurred by Lessee in connection with the move and (ii) pay for fifty percent
(50%) of the tenant improvements to be constructed in the new
space.  If Lessee decides to exercise its option to expand into the
Adjacent Space or if parties agree on a new building to which Lessee can move
its operations, the parties hereto shall either (i) execute an amendment to this
Lease which redefines the Leased Premises to include the Adjacent Space or
substitute the new building as the Leased Premises and recalculates rent by
multiplying the rental rate set forth in Section 5.1 by the new square footage
of the Leased Premises or (ii) enter into a new lease agreement under similar
terms and conditions as those set forth herein.  Notwithstanding the
foregoing, any new lease or amendment to this Lease entered into between the
parties pursuant to this Article 23 shall include language which sets forth a
term or extends the Term for a period of at least five (5) years commencing on
the execution date of the amendment or the new lease or such other date as set
forth therein.  It is agreed by the parties that in the event the
parties enter into a new lease pursuant to the terms of this Article 23, Lessee
shall cause a guaranty, similar to the Guaranty granted to Lessor pursuant to
Exhibit F
hereto, be granted to Lessor.

     

    ARTICLE
24.          NOTICES.

     

    Whenever
it shall be necessary or desirable for either of the parties to serve any notice
of demand upon the other party pursuant to the provisions of this Agreement,
such notice or demand shall be served personally, or by registered or certified
mail, return receipt requested, sent to the addresses set forth hereunder, until
otherwise directed in writing by the party which wishes to change its
address:

    


    
      	
              Lessor:

            	
              INMOBILIARIA
      LA RUMOROSA, S.A. DE C.V.

              Av.
      Eucalipto y Venustiano Carranza 2399

              Col.
      Rivera, Mexicali, B.C. Mexico

               

            
	
              Lessee:

            	
              IVEMSA
      S.A. DE C.V.

              Circuito
      Internacional Sur # 21

              Parque
      Industrial Nelson, Mexicali, B.C.
México

            


    

    


    ARTICLE
25.          ENTIRE
AGREEMENT.

     

    This
Agreement and its Exhibits contain all the agreements and conditions between the
parties.  Therefore, the parties hereto agree that with the execution
of this Agreement, any prior agreements have been duly fulfilled and complied
with, except as set forth hereunder.

     

    ARTICLE
26.          AMENDMENTS.

     

    This
agreement may only be modified by a written agreement signed by the authorized
representatives of the Lessor and Lessee.

     

    ARTICLE
27.          SEVERABILITY.

     

    If any
term or provision of this Lease shall be illegal, invalid or unenforceable under
present or future laws effective during the Term of this Lease, the remainder of
this Lease shall not be affected thereby, and each term and provision of this
Lease shall be valid and enforceable to the fullest extent permitted by
law.  It is the intention of the parties hereto that if any provision
of this Lease is capable of two constructions, one of which would render the
provision void and the other of which would render the provision valid, then the
provision shall have the meaning that renders it valid.

     

    ARTICLE
28.          RECITALS.

     

    The
recitals of this Lease, shall be considered a part of this Agreement and shall
be binding on all parties hereto.

     

    ARTICLE
29.          LANGUAGE.

     

    This
agreement shall only be executed and delivered in English.  Any
translations of this Lease into Spanish for ease of reference shall be
considered secondary to the executed English version and shall be of no force or
effect in the event a dispute arises regarding the terms of this Lease. For all
official purposes and in case of litigation only the English version shall be
used, and at all times the English version shall control.

     

    ARTICLE
30.          GOVERNING LAW, JURISDICTION
AND ARBITRATION.

     

    
      	
              30.1

            	
              This
      Agreement shall be governed by the laws of the Republic of Mexico and the
      State of Baja California.

            


    

    


    
      	
              30.2

            	
              The
      parties shall in first instance endeavor to resolve any dispute,
      controversy or claim arising out of, relating to, or in connection with,
      this Agreement, or the breach, termination or validity thereof (a
      "Dispute") by amicable negotiation among the parties.  The Guarantor
      shall be permitted to participate in any such negotiation.  Any party
      may commence such negotiations by giving notice (the "Dispute Notice") to
      the other party and the Guarantor that refers to this provision of the
      Agreement.

            


    

    


    
      	
              30.3

            	
              In
      the event negotiations are not successful within 30 days after the Dispute
      Notice, the Dispute shall be finally settled by arbitration. The
      arbitration shall be conducted in accordance with the UNCITRAL
      Rules in effect at the time of the arbitration except as they may be
      modified herein or by mutual agreement of the parties. The seat of the
      arbitration shall be the City of Mexicali and it shall be conducted
      in English. The arbitration shall be conducted by a sole
      arbitrator, who shall be selected by agreement of the parties and the
      Guarantor or, failing such agreement after 5 days' demand, in
      accordance with the UNCITRAL
Rules.

            


    

    


    
      	
              30.4

            	
              The
      Guarantor shall be permitted to participate fully in the arbitration, with
      its own counsel if it so chooses.  The proceedings shall be
      confidential.

            


    

    


    
      	
              30.5

            	
              The
      arbitrator shall follow the terms of this Agreement, in preference to
      principles of equity or custom and practice, in rendering the arbitral
      decision and award.  The arbitral decision and award shall be in
      writing and shall be final and binding on the parties. The award may
      include an award of costs, including reasonable attorney's fees and
      disbursements. Judgment upon the award may be entered by any court having
      jurisdiction thereof or having jurisdiction over the parties or their
      assets.  Enforcement may be sought under the UN Convention on the
      Recognition and Enforcement of Foreign Arbitral
  Awards.

            


    

    


    ARTICLE
31.          REASONABLE
CONSENT.

     

    Except as
limited elsewhere in this Lease, wherever in this Lease Lessor or Lessee is
required to give its consent or approval to any action on the part of the other,
such consent or approval shall not be unreasonably withheld or
delayed.

     

    ARTICLE
32.          WAIVER.

     

    No
covenant, term, or condition or the breach thereof shall be deemed waived,
except by written consent of the party against whom the waiver is claimed, and
any waiver of the breach of any covenant, term or condition shall not be deemed
to be a waiver of any other covenant, term or condition.  Acceptance
by Lessor of any performance by Lessee after the time the same shall have become
due shall not constitute a waiver by Lessor of the breach or default of any
covenant, term, or condition, unless otherwise expressly agreed to by Lessor in
writing.

     

    ARTICLE
33.          FORCE
MAJEURE.

     

    Neither
Lessor nor Lessee shall be deemed to have failed or delayed in making any
required repairs or replacements or performing any work or other obligation
under this Lease, except the payment of rent pursuant to Article 5, if the party
whose act is delayed is unable to make or is delayed in making any repair or
performing work or such other obligation called for herein (i) by reason of
strikes or labor troubles, (ii) by reason of governmental preemption in
connection with a national emergency, (iii) by reason of fire, casualty or other
acts of God or (iv) by reasons of any other cause whatsoever beyond said party’s
reasonable control.  Said party shall in each instance exercise
reasonable diligence to effect performance when such delaying condition is no
longer present.

     

    ARTICLE
34.          SIGNAGE.

     

    Lessee
shall not place any exterior identification signs on the Building without the
prior written consent of Lessor, which approval shall not be unreasonably
withheld, conditioned or delayed.  Lessor reserves the right to place
other signage on the property owned by Lessor within which the Leased Premises
are located.  Lessor and Lessee agree that Guarantor shall have the
right to have its name on (i) all Park directories, if any, (ii) all exterior
doors leading into the Leased Premises, (iii) any monument signage now or
hereafter located at the entrance to the Building or Park which has tenant names
on it, and (iv) on the exterior of the Building in a form and manner mutually
agreeable to both Lessor, Lessee, and Guarantor.  Lessee shall pay for
the reasonable cost of such signage and the location and specifications for such
signage shall be subject to the prior approval of Lessor, which approval shall
not be unreasonably withheld, conditioned or delayed.

    


    ARTICLE
35.
          EXHIBITS.

    


    The
following exhibits are attached hereto and become a part of this
Lease:

     

    
      	 
      	
              1.

            	
              Exhibit
      A – Authority of Pablo Charvel Orozco

            
	 
      	
              2.

            	
              Exhibit
      B – Master Parcel Legal Description

            
	 
      	
              3.

            	
              Exhibit
      C – Master Parcel Drawing and Depiction of Leased
  Premises

            
	 
      	
              4.

            	
              Exhibit
      D – Authority of Sergio Taglapietra Nassri

            
	 
      	
              5.

            	
              Exhibit
      E – Rules and Regulations of Park

            
	 
      	
              6.

            	
              Exhibit
      F – Guaranty

            
	 
      	
              7.

            	
              Exhibit
      G - Finish Work

            
	 
      	
              8.

            	
              Exhibit
      H – Adjacent Space

            


    

    


     

    IN
WITNESS WHEREOF, Lessor and Lessee have caused this Lease to be executed and
delivered as of the date first written above.

     

    
      
        
          	
                  Lessor:

                  INMOBILIARIA
      LA RUMOROSA, S.A. DE C.V

                	 
      	
                  Lessee:

                  IVEMSA
      S.A. DE C.V.

                
	
                  /s/
      Pablo Charvel Orozco

                	 
      	
                  /s/
      Sergio Tagliapietra Nassri

                
	
                  By: Pablo
      Charvel Orozco

                	 
      	
                  By: Sergio
      Tagliapietra Nassri

                
	
                  Title: Attorney-in-fact

                	 
      	
                  Title: Attorney-in-fact

                
	
                  Place:Mexicali,
      B.C.Date: 1/02/2006

                	 
      	
                  Place:
      Mexicali,B.C. Date:        2006

                
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                  WITNESSES:

                	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      /s/ Ricardo Medina	 
      	 
      	 
      /s/ Rodolfo Andrade	 
      
	
                  Ricardo
      Medina

                	 
      	
                  Rodolfo
      Andrade

                


        

      

    

    


     

    
      
        
           


        

        
           


          
            

          

        

        
           


        

      

    

     

    


    EXHIBIT
“F”

     

    GUARANTY

     

    WHEREAS,
INMOBILIARIA LA RUMOROSA, S.A.
DE C.V. (“hereinafter referred to as “COMPANY”) is the owner of
certain real property described as a portion of lot 98 (ninety eight) of Colonia
Rivera, of the city of Mexicali, Baja California, Mexico (hereinafter referred
to as the “REAL
PROPERTY”);

     

    WHEREAS,
IVEMSA S.A. DE C.V. (hereinafter referred to as “TENANT”), wishes to lease from
the COMPANY the REAL PROPERTY (as referred to in the “Lease”) an industrial
building built thereon by the COMPANY.

     

    WHEREAS,
this Guaranty is given by LEONARD’S METAL, INC., (hereinafter referred to as
“GUARANTOR”), to induce
COMPANY to enter into a Lease Agreement with TENANT, dated January 7th, 2006,
(the “Lease”).

     

    NOW
THEREFORE, in consideration of the foregoing, it is agreed:

     

    1.           OBLIGATION OF THE GUARANTOR.
GUARANTOR unconditionally guarantees to COMPANY, its successors and assigns, the
prompt, full and complete payment and performance to COMPANY of all the
conditions, covenants, obligations, liabilities and agreements of the TENANT as
set forth in the Lease dated January 7th, 2006
by and between COMPANY and TENANT or any extension thereof or amendment thereto
(the Lease and extensions are collectively referred to herein as the
“Lease”).  This Guaranty extends to and includes any and all interest
due or to become due, together with all attorneys’ fees, cost and expenses of
collection incurred by COMPANY in connection with any matter covered by this
Guaranty or the Lease.

     

    2.           TERM OF
GUARANTY.  The liability of the GUARANTOR shall continue until
payment is made and performance given pursuant to every obligation of the TENANT
now due or hereafter to become due in accordance with the terms of the Lease,
and until payment is made of any loss or damage incurred by COMPANY with respect
to any matter covered by this Guaranty or the Lease, except to pay COMPANY’S
attorneys’ fees, costs and expenses of collection incurred in proceeding against
GUARANTOR hereunder.

     

    This
Guaranty shall be irrevocable.  Nothing contained herein shall impose
upon GUARANTOR any greater or different liability than is or may be imposed on
said TENANT under the Lease.

     

    3.           CONSENT TO COMPANY’S
ACTS.  GUARANTOR consents, without affecting GUARANTOR’S
liability to COMPANY hereunder, that COMPANY may, without notice to or consent
of GUARANTOR, upon such terms as it may deem advisable:

     

    a.           Extend,
in whole or in part, by renewal or otherwise, any time of payment or performance
on the part of TENANT, provided for in the Lease.

     

    b.           Release,
surrender, exchange, modify or extend any period or duration, or any time for
performance or payment impair on the part of TENANT, required by the Lease,
and

     

    c.           Settle
or compromise any claim of COMPANY against TENANT or against any other person,
firm or corporation whose obligation is held by COMPANY under the
Lease.

     

    GUARANTOR
hereby ratifies and affirms any such extension, renewal, release, surrender,
exchange, modification, impairment settlement or compromise and all such acts
shall be binding upon GUARANTOR who hereby waives all defense, counterclaims or
offsets which GUARANTOR might have solely by reason thereof.

     

    4.           WAIVER OF
GUARANTOR.  GUARANTOR waives:

     

    
      	
               
      

            	
              a.

            	
              Notice
      of acceptance of this Guaranty by
COMPANY:

            


    

     

    
      	
               
      

            	
              b.

            	
              Notice
      of the failure of any person, firm or corporation to pay to COMPANY any
      indebtedness held by COMPANY as collateral security for any obligation of
      TENANT under the Lease, unless otherwise provided for in the
      Lease;

            


    

     

    
      	
               
      

            	
              c.

            	
              In
      its case, any defects in perfection of the assignment and pledge of the
      rents by failure to record the Lease or any instrument or assignment and
      pledge in the respective Public Registry of Property and Commerce under
      Mexican Law;

            


    

     

    Notwithstanding
the above, Company shall provide information to GUARANTOR regarding any notice
of presentment, notice of nonperformance, notices of dishonor and notices of the
existence, creation or incurring of new or additional indebtedness or
obligations, demands for payment or performance or protest of any obligation of
TENANT to COMPANY under the Lease, unless otherwise provided for in the Lease;
allowing GUARANTOR to cure any breach on behalf of TENANT prior to initiation of
any action by COMPANY against either TENANT and/or COMPANY.

     

    5.           REPRESENTATIONS BY
GUARANTOR.  GUARANTOR represents and warrants that at the time
of execution and delivery of this Guaranty nothing exists to impair the
effectiveness of the liability of GUARANTOR to COMPANY hereunder, or the
immediate taking effect of this Guaranty as sole agreement between the GUARANTOR
and COMPANY with respect to guaranteeing all of TENANT’S obligations to COMPANY
under the Lease.

     

    GUARANTOR
further represents and warrants that GUARANTOR is authorized to execute and
deliver this Guaranty and that the person executing this Guaranty is authorized
to execute the same for and on behalf of GUARANTOR.

     

    6.           REMEDY OF
COMPANY.  In the event of any default on the part of TENANT as
defined in the Lease, COMPANY will proceed in the first instance against TENANT,
to collect any obligation assumed by TENANT under the Lease, and thereafter
GUARANTOR or any other person, firm or corporation but without first resorting
to any property at any time held by COMPANY and without first resorting to any
property at any time held by COMPANY as security.

     

    7.           MODIFICATION OF
AGREEMENT.  The whole of this Guaranty is herein set forth and
there is no verbal or other written agreement affecting the terms
hereof.  This Guaranty can be modified only by written instrument
signed by the GUARANTOR and the COMPANY.

     

    8.           NON-WAIVER BY
COMPANY.  The liability of GUARANTOR under this Guaranty shall
not be affected by the insolvency of COMPANY or TENANT, at any time or by the
acceptance by COMPANY of security, notices, acceptance, drafts or checks or by
assignment, foreclosure of the other dispositions thereof by COMPANY presenting
or providing for allowance any secured unsecured claim or demand or by COMPANY’S
acceptance of any plan or reorganization, settlement, compromise, dividend,
payment or distribution, and GUARANTOR shall not be entitled to claim any right
in or benefit by reason of any such plan or reorganization, settlement,
compromise, dividend, payment or distribution, or in or by reason of any
security held by COMPANY, or the proceeds or other disposition thereof, unless
and until all of said obligation, liabilities and indebtedness, together with
interest, attorney’s fees and costs due to COMPANY under this Guaranty or under
the Lease, shall have been paid in full.  Nothing contained in this
Agreement shall alter any of the rights or remedies of COMPANY against
TENANT.  GUARANTOR authorizes COMPANY, prior without notice or demand
and without affecting the liability of GUARANTOR hereunder, from time to time
to:

     

    
      	
               
      

            	
              a.

            	
              Renew,
      compromise, extend, accelerate, or otherwise change the time for payment
      of, or otherwise change the terms of the indebtedness or any part thereof
      under the Lease, including increase or decrease of any amounts due
      thereunder or any rate of interest specified therein provided that such
      renewal, compromise, extension, acceleration or other change is made
      pursuant to the terms of the Lease;

            


    

     

    
      	
               
      

            	
              b.

            	
              Take
      and hold security for the payment of this GUARANTY or indebtedness
      guaranteed and exchanged, enforced, waived, release any such
      security;

            


    

     

    
      	
               
      

            	
              c.

            	
              Apply
      such security and direct the order or manner of sale thereof as COMPANY in
      its discretion may determine; and

            


    

     

    
      	
               
      

            	
              d.

            	
              COMPANY
      may assign this Guaranty in whole or in part provided that GUARANTOR shall
      remain liable for their obligations hereunder unless released therefrom by
      COMPANY or its successors and provided further COMPANY authorizes such
      assignment and release in writing.

            


    

     

    9.           APPLICABLE
LAW.  This Guaranty is made in the State of Missouri, USA, and
the rights and obligations of the parties hereunder shall be construed and
enforced in accordance with the laws of such State.  It is hereby
expressly understood and agreed by the parties that in the event a dispute
should arise as to the performance of the obligations pursuant to this Guaranty,
any action relating to this Guaranty shall be instituted and prosecuted in the
courts of the County of St. Louis in the State of Missouri, USA, and each party
hereby submits to such Jurisdiction and waives the right to change the
venue.

     

    10.           MISCELLANEOUS
PROVISIONS.  GUARANTOR agrees to pay to COMPANY attorney’s fees
and all other costs and expenses which may be incurred by the COMPANY in the
collection or efforts to collect the indebtedness owed by TENANT to COMPANY
pursuant to the Lease or in the collection or efforts to collect or enforcement
of the sums due under this Guaranty, provided that if GUARANTOR is the
prevailing party in any action or proceeding to enforce this Guaranty or
collection of amounts allegedly due hereunder, COMPANY shall pay GUARANTOR a
reasonable attorney’s fee and other costs and expenses which may be incurred by
GUARANTOR.  The paragraph heading of this Guaranty are not part of
this Guaranty and shall have no effect upon the construction of interpretation
of any part hereof and are inserted herein for convenience only.  In
the event that any provision hereof or any portion of any provision hereof shall
be deemed to be invalid or unenforceable, such invalidity or unenforceability
shall not affect any other portion of said provision or any provision
herein.  All remedies herein conferred upon COMPANY shall be
cumulative and no one exclusive of any other remedy conferred herein or by law
or equity.  Time is of the essence in the performance of each and
every obligation herein imposed.

     

    GUARANTOR
represents and warrants that it has all requisite power and authority to enter
into this Guaranty and that neither the execution or delivery of this Guaranty
or the consummation hereof nor the performance of the terms hereof will conflict
with or result in a breach of the terms, conditions or provision of or
constitute a default under or result in the creation of any lien pursuant to any
other agreement or instrument under which GUARANTOR is obligated.

     

    11.           ACKNOWLEDGMENT OF
ASSIGNMENT.  In the event this Guaranty is assigned to a bank
or other lending institution the, GUARANTOR shall furnish to such assignee a
letter stating that the GUARANTOR shall acknowledge receipt of notice of any
assignment by COMPANY of this Guaranty; that this Guaranty is in full force and
effect, that no change to this Guaranty as originally executed have been made;
that the GUARANTOR will not enter into any modification of this Guaranty without
first obtaining prior written approval thereof from said assignee; that said
assignee may rely solely upon the Guaranty with respect to the assignee’s right
to receive the rents and performance of TENANT’S other obligations in accordance
with the terms of the Lease; and that all payments made thereafter shall be made
to the assignee at such times not in conflict with those permissible under the
Lease.

     

    12.           NOTICE OF
DEFAULT.  Notwithstanding any provision to the contrary herein
expressed or implied, no claim of default on the part of TENANT or on part of
GUARANTOR shall be made hereunder unless and until notice of such default has
been given to TENANT as provided in the Lease and copy thereof mailed to
GUARANTOR by first class certified mail, postage prepaid at the following
address:

     

    
      	 
      	
              Leonard’s
      Metal, Inc.

            
	 
      	
              c/o
      LMI Aerospace, Inc.

            
	 
      	
              2600
      Mueller Road

            
	 
      	
              St.
      Charles, MO 63301

            
	 
      	
              Attn:  Mr.
      Michael Biffignani

            


    

    


    13.           SUCCESSOR
BOUND.  This Guaranty is binding jointly and severally upon
GUARANTOR and its legal representatives and successors and shall inure to the
benefit of COMPANY, its legal representatives, successor and
assignees.

     

    14.           TENANT
ACKNOWLEDGMENT.  In connection with Tenant’s performance of its
obligations under the Lease, Tenant acknowledges and agrees to (i) undertake all
acts or omissions as may be directed by Guarantor, in Guarantor’s sole
discretion, so long as such acts or omissions do not conflict with applicable
laws, rules or regulations; (ii) obtain the written consent of Guarantor prior
to exercising any option for additional space or right of renewal set forth in
the Lease; (iii) indemnify and hold Guarantor harmless for all claims, demands,
losses, liabilities, costs, expenses, obligations and damages which arise or
result from or relate to Tenant’s negligence or willful misconduct and/or
Tenant’s breach of the Lease.

     

    IN
WITNESS WHEREOF, the parties have signed this Agreement on January 7th,
2006.

     

    
      	 
      	
              GUARANTOR

            
	 
      	
              LEONARD’S
      METAL, INC.

            
	 
      	 
      
	 
      	 
      
	 
      	
              By:

            	
              /s/ Mike Biffignani

            
	 
      	 
      	 
      
	 
      	
              Name:

            	
              Mike Biffignani

            
	 
      	 
      	 
      
	 
      	
              Title:

            	
              CIO

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              COMPANY

            
	 
      	
              INMOBILIARIA
      LA RUMOROSA, S.A.DEC.V.

            
	 
      	 
      
	 
      	 
      
	 
      	
              By:

            	
              /s/Paflo Charvel

            
	 
      	 
      	
              PAFLO
      CHARVEL

            
	 
      	
              Its:

            	
              Legal
      Representative