EXHIBIT 10.15
DEED OF LEASE
ARTICLE 1: PARTIES
This DEED OF LEASE is made and executed in Bangalore on this the sixteenth
day of October Two Thousand and Two
BY AND BETWEEN
1. Mr. M Srinivas Reddy son of Late K.T. Muni Reddy and
2. Ms. K C Komala daughter of K T. Chinappa Reddy
3. Ms. Akkayamma wife of Late K. T. Muni Reddy
4. Ms. Chikka Muniyamma daughter of Late K.T. Muni Reddy
5. Ms. Rathnamma daughter of Late K.T Muni Reddy
Person 1 named above residing at No.131, Anjaneya Temple Street, Koramangala
Village, Bangalore 560095 and person 2 named above residing at No. 33, 5'h
Block, Koramangala, Bangalore 560095, hereinafter collectively referred to as
"the Lessors" (which expression shall unless repugnant to the context mean and
include their respective heirs, legal representatives, administrators, executors
and assigns) and persons 3, 4, & 5 named above are hereinafter collectively
referred to as the "Consenting Parties" (which expression shall unless repugnant
to the context mean and include their respective heirs, legal representatives,
administrators, executors and assigns) of the One Part
AND
HEALTHSCRIBE INDIA LIMITED, a Company registered under the Companies Act, 1956,
having its Registered Office at One HealthScribe Plaza, Koramangala Block 8,
Bangalore -560 095 represented herein by its Vice President, Mr. Surya V.
Ciryam, hereinafter called "the Lessee" (which expression shall unless repugnant
to the context mean and include its successors-in-interest and assigns) of the
Other Part.
WITNESSETH:
ARTICLE 2: GRANT OF LEASE
The Lessors hereby grant to the Lessee and the Lessee hereby accepts from
the Lessors a lease of all that piece and parcel of property fully described in
Article 3 herein below.
ARTICLE 3: DESCRIPTION OF THE PROPERTY
The property hereby leased is all that piece and parcel of property being
ground floor and first floor of the building having a total built area of 4480
square feet constructed on land bearing Khata No.873, House list No.637,
Koramangala Village, Begur Hobli, Bangalore South Taluk, Bangalore District with
new BMP address bearing No. 1/3, H Main Road, K R Garden, Ward
no.67, Koramangala, Bangalore South Taluk. The boundaries and measurement of the
aforesaid property bearing Khata No.873 are as follows:
East by: Krishna Reddy's property
West by: K.M Narayana Reddy's property
North by: 10 feet access passage between K. T Chinappa Reddy and Pillappa Reddy
properties
South by: K. M Narayana Reddy property
The property hereby leased is hereinafter referred to as "the Demised Premises".
ARTICLE 4:
ARTICLE 4: TERM, RENEWAL OPTION AND TERMINATION OPTION
(a) TERM
The term of the lease shall be initially for a period of five years
and six months commencing from I" October 2002 ending on 31" March
2008.
(b) RENEWAL OPTION
(1) The Lessee shall have the option to renew the lease by giving
a written notice of not less than sixty (60) days-to the
Lessors, for such further period or periods and on such same
terms and conditions as the Lessors and the Lessee may
mutually agree upon.
(2) The parties shall execute a fresh Lease Deed for the renewed
term.
(c) TERMINATION OPTION
(1) The Lessee shall have the right to terminate the lease,
without assigning any reason whatsoever by written notice to
the Lessors of its intent to so terminate of not less than
sixty (60) days prior to the Termination Date ("Termination
Option") or compensation in lieu of such notice period.
(2) In addition, in the event of the Lessors committing a breach
of any of the terms of this lease deed, or failing to fulfill
any of their obligations under this lease deed, the Lessee
shall be entitled to terminate this lease deed after giving a
written notice of thirty (30) days, provided that the Lessee
shall not be so entitled if the Lessors commence to remedy the
breach before the expiry of the above mentioned notice period.
(3) The Lessors shall be entitled to terminate this lease in the
event the Lessee breaches any of the terms of this lease deed
and/or defaults of payment of rent for two consecutive months,
by giving the Lessee a written notice of thirty (30) days,
provided that the Lessor shall not be entitled to so
terminate if the Lessee commences to remedy the breach before
the expiry of the above mentioned notice period.
(4) In any of the above cases, if the Lessee or Lessor exercise
their Termination Option, this lease shall stand terminated
effective as of the Termination Date and be of no further
force or effect and the Lessors shall on the Termination Date
and upon the Lessee surrendering the Demised Premises as
provided in Article 18 herein below refund to the Lessee the
Refundable Security Deposit and other moneys due by them to
the Lessee. If the Lessors fail to so refund, the Lessors
shall be liable to pay interest thereon at 18 percent per
annum and the Lessee shall be entitled to retain possession of
the Demised Premises until such time, free of lease rentals.
ARTICLE 5: RENT AND SECURITY DEPOSIT
(a) RENT
(1) The rent payable by the Lessee to the Lessors for the Demised
Premises shall be Rs.10/- (Rupees Ten only) per SFT, per month
of the total built area of 4480 SFT, such rent to be increased
every two years of the lease term by 15% over and above the
rent paid for the last preceding month.
(2) The tenancy month shall be the English Calendar month.
(3) It is hereby agreed by the Lessors that the rent shall be paid
in advance on or before 8th day of every calendar month for
which the rent shall be due by way of two Account Payee local
cheques dividing equally the total rent payable as per this
deed between the two Lessors, one drawn in favour of Mr. M.
Srinivas Reddy and the other in favour of Ms. K.C. Komala.
(4) The Lessee may wberever necessary deduct the tax at source as
per the provisions of the Income Tax Act, 1961 and issue the
necessary Certificates at the end of each financial year.
(5) The payment of rent for the ground floor measuring 2080 square
feet to begin from October 1st 2002 and rent for the first
floor measuring 2400 square feet from December 1st 2002 on
handing over possession of the same by the Lessors to the
Lessee on or before such date. Should there be any delay in
such handing over, rent for the first floor shall begin from
such date of hand over.
(b) REFUNDABLE SECURITY DEPOSIT
(1) The Lessee has this day, at the time of execution of this Deed
of Lease, paid to the Lessors as Refundable Security Deposit a
sum of Rs. 6,72,000/-(Rupees six lakhs seventy two thousands
only) divided equally between the two Lessors, Mr. M. Srinivas
Reddy and Ms. K.C. Komala, a sum of Rs. 3,36,000 (Rupees three
lakhs thirty six thousands) each, receipt
of which the Lessors hereby acknowledge. The Lessors shall
hold the Refundable Security Deposit during the term of the
lease and shall refund the said amount as provided in Article
4(c)(4).
(2) A sum of Rs. 5000 (rupees five thousand only) paid as nominal
advance vide clause No. 8 of our Letter Of Intent dated July
16, 2002 to be deducted from the amount payable as per
Article 5(b)(1) above to Lessor 1 (Mr. M. Srinivas Reddy)
(3) A sum of Rs. 48,000 (rupees forty-eight thousand only) divided
equally between the two Lessors (Rs. 24,000 each) to be
deducted from the amount payable as per Article 5(b)(1) above
being the maximum amount agreed by the Lessors to be borne by
them for the interior works of the first floor toilets which
will be. done by the Lessee. Refer clause No. 3(xvi) of our
Letter Of Intent dated July 16, 2002.
ARTICLE 6: LESSEE'S ENTITLEMENT THE LESSEE SHALL BE ENTITLED TO:
The Lessee shall be entitled to:
(a) To do up the interior of the Demised Premises, at the discretion and as
required by the Lessee and to install such fixtures, fittings, furniture,
etc. as the Lessee deems fit, without causing any structural damage to the
Premises.
(b) To make any additions or alterations to light points, wiring, electrical
fixtures and fittings,
(c) To erect partitions, to make cabins, install room air-conditioners or
central air-conditioning plant and related accessories including cooling
towers,
(d) To affix or install any and all communication apparatus or equipment
including but not limited to Dish Antennae,
(e) To erect or install infrastructure necessities for the purpose of affixing
or installing the said communication apparatus or equipment,
(f) To install generator sets, diesel storage tank, transformer, and
switchgear in the Demised Premises,
(g) To set up computer system, to lay cables, to change sanitary fittings, if
required, and to install facsimile and other facilities in the Demised
Premises,
(h) To display signboard, neon signs, advertisements in any part of the
Demised Premises,
(i) To fix or install such other devices, gadgets and equipments as the Lessee
may deem fit from time to time for the purpose of carrying on its
business,
(j) To run a GYM exclusively for its employees,
(k) To allow parking of vehicles for its employees,
(l) To offer any of the items of furniture, fixtures and other installations
and fittings for sale to the Lessors upon the expiry of the lease term and
if the Lessors refuses to purchase, to remove, at its discretion, such
additions, alterations, air-conditioners, internal partitions, cabins,
devices, gadgets, carpets, electrical fittings, furniture and fixtures and
other equipments installed by the Lessee, whether or not affixed to the
earth or to the building, without causing any structural damage to the
Demised Premises.
ARTICLE 7: LESSEE'S COVENANTS
The Lessee hereby covenants with the Lessors that it shall:
(a) Pay charges for electricity and water consumed by the Lessee in the
Demised Premises as per separate meters provided therefor;
(b) Maintain the interiors of the Demised Premises, their doors, windows,
fittings and accessories in good condition;
(c) Keep the Demised Premises in good order and condition, reasonable wear and
tear excepted;
(d) Not carry on or permit to be carried on in the Demised Premises any
offensive trade or business nor use the same or allow the same to be used
for any illegal purpose;
(e) Not carry out any structural alterations to the Demised Premises, and
(f) Not to bring in or store in the Demised Premises any hazardous goods or
goods which are of combustible or inflammable nature;
ARTICLE 8: LESSORS' COVENANTS
The Lessors covenants that:
(a) The Lessors have a good and marketable title to the Demised Premises;
(b) The Lessors are seized of and are entitled both in law and on facts to
lease the Demised Premises in the manner and on the terms and conditions
herein set out;
(c) The Demised Premises have been constructed in accordance with the plans
sanctioned and the rules, regulations and byelaws of the concerned
local/State/Central Government Authorities and the Lessors have obtained
all permissions/sanctions/approvals from the said Authorities for the
construction.
(d) In the event of there being a breach of any or all the covenants at
Article 8 (a) to (b) above and consequent to which the Lessee being
prevented from quiet and peaceful possession and enjoyment of the Demised
Premises or otherwise the Lessee suffering any loss or damage due to
default of the Lessors, the Lessors hereby agree and undertake to
keep and hold the Lessee indemnified and harmless at all times against
such loss or damage.
(e) The Lessors agree to close the entry from the North side passage of the
Demised Premises by a brick wall and to provide temporary opening on the
south side into the property belonging to K.M. Narayan Reddy, for purposes
of entry into the Demised Premises, during the term of this lease. Upon
termination of this lease the temporary entry mentioned above to the
Demised Premises stands barred and the said opening to be compulsorily
closed by the Lessors.
ARTICLE 9: ELECTRICAL SERVICE
The Lessors have provided 30 KW power from the Karnataka Power
Transmission Corporation Limited (KPTCL). If the Lessee requires additional
power load, the Lessee shall be entitled to apply for and obtain the additional
power load from KPTCL or any other supplier, the cost of which shall be borne
and paid by the Lessee. Provided that upon the termination of the lease, the
Lessee may surrender the additional power load to the KPTCL and collect the
deposit made therefor or give an option to the Lessors to purchase the
additional load. If the Lessors purchase the additional power load, the Lessee
shall be entitled to collect the deposit made therefor from the Lessors. The
Lessors shall co-operate with the Lessee in regard to availing of the additional
power load and its surrender as stated above and return of the deposits if any,
to the Lessee.
ARTICLE 10: ASSIGNMENT
The Lessee shall have the absolute right to assign this lease or sublease
the whole or any part of the Demised Premises to any of its Group Companies,
Holding Company, Subsidiary Company, Associated Company, licensees and
concessionaries without the Lessors' consent. However, the Lessee shall notify
the Lessors of such assignment or sublease and no assignment or sublease shall
release the Lessee of its obligations in this Deed of Lease.
ARTICLE 11: USE AND COMPLIANCE WITH LAW
(a) USE
The Lessee shall use the Demised Premises for the purpose of
business requirements
(b) COMPLIANCE WITH LAW
The Lessors and the Lessee hereby agree to comply with the relevant
law as may be applicable to the Demised Premises.
(c) FURTHER INDEMNITY
The Lessors shall indemnify the Lessee for any loss or damage caused
to the Lessee on account of any act done by the Lessors or their
agents or
representatives in the Demised Premises and on account of latent
defect in the Demised Premises.
ARTICLE 12: REPAIR AND MAINTENANCE RESPONSIBILITIES
(a) LESSEE'S REPAIR AND MAINTENANCE RESPONSIBILITIES
Except as provided in Article 12(b) (Lessors' Repair and Maintenance
Responsibilities) and natural wear and tear, the Lessee shall at its
sole cost and expenses repair and maintain the interior of the
Demised Premises and the internal electrical, water, drainage,
sewerage and other systems in the Demised Premises in good and
tenantable condition.
(b) LESSORS' REPAIR AND MAINTENANCE RESPONSIBILITIES
(1) Except for the Lessees responsibilities pursuant to Article
12(a), the Lessors, at their cost and expense, shall keep the
entire Demised Premises wind and watertight at all times, for
the proper use of the Demised Premises including, without
limitation, the building's roof, foundation, structure and
walls, external plumbing and drainage systems and sewerage
lines of the building.
(2) If the Lessors fail to carry out the structural or major
repairs as aforesaid and as pointed out by the Lessee, the
Lessee may, upon written notice to the Lessors, be entitled to
carry out the said repairs and deduct the cost thereof from
the rent due to the Lessors.
ARTICLE 13: REAL PROPERTY TAXES
The Lessors shall pay all present and future taxes, assessments, cess,
other charges and all outgoings imposed or levied upon in respect of the Demised
Premises by any local, State or Central Government Authorities.
ARTICLE 14: INSURANCE
1. INSURANCE BY THE LESSEE
1.1 The Lessee may insure and keep insured in such adequate
amounts to cover replacement or loss and with reputable
insurance Companies the following:
1.1.1 Such fixtures and fittings for the replacement of which the
Lessee is responsible;
1.1.2 all liabilities of the Lessee and its authorized agents,
employees and/or representatives arising out of and in
connection with the Lessee's use and occupation of the Demised
Premises;
2. INSURANCE BY THE LESSORS
2.1 The Lessors shall maintain "All Risk Property Insurance" and
keep the Demised Premises and the equipments installed by the
Lessors therein (excluding the equipments installed by the
Lessee) insured subject to such exclusions and limitations as
may be imposed by the insurers with a reputable insurance
Company in such value and for loss or damage by fire, storm,
earthquake, riot and such other natural disasters.
2.2 In the event of any damage or destruction resulting from any
such insured risks, the Lessors shall utilize all the
insurance proceeds on the reinstatement of the Demised
Premises in accordance with the existing plans, sections,
elevations and specifications thereof and shall provide the
Lessee the building reasonably equivalent to that now
existing.
2.3 Lessors shall provide at their own cost the deficit amount, if
any, required for reinstatement of the Demised Premises over
and above the insurance proceeds received by it.
2.4 If the whole or a substantial part of the Demised Premises are
destroyed or damaged by any natural disaster, whether insured
or not, so as to be unfit for the use of the Lessee, during
the period from the date of such destruction or damage until
the Demised Premises are reinstated, the rents due or a fair
proportion of them if there is only partial damage shall not
be payable by the Lessee. The period during which the Lessee
was unable to occupy and/or use the Demised Premises on
account of such damage or destruction shall not be considered
for the purpose of reckoning the term of the lease.
2.5 If the whole or a substantial part of the Demised Premises is
destroyed or damaged by any natural disaster or as a
consequence of such natural disaster, the Demised Premises are
in such state of disrepair that the Lessee considers not
possible to put the Demised Premises into repair or if the
Lessors are prevented from repairing the Demised Premises
within a reasonable time for any reason beyond its control,
then the lease shall be deemed to have been terminated
effective on the day of occurrence of such natural disaster
and the obligation of the Lessee to pay the rent for the
Demised Premises shall abate.
ARTICLE 15: QUIET ENJOYMENT
The Lessors warrant that they have the full right and authority to execute
this Deed of Lease and to grant the lease of the Demised Premises, and that the
Lessee, upon payment of the rent and performance of the covenants herein
contained, shall peaceably and quietly hold, possess and enjoy the demised
premises during the full term of this lease and any extensions
thereof without any interruption, disturbance, claims or demands whatsoever by
the Lessors or any person(s) on behalf of the Lessors.
ARTICLE 16: LESSEE'S RIGHT OF ACCESS
The Lessee and its employees/staff shall have 24 hours access to the
Demised Premises at all rimes during the term of the lease and Renewal Term
without any hindrance or interruption from or by the Lessors.
ARTICLE 17: LESSORS' RIGHT OF ENTRY
The Lessee agrees to permit the Lessors to enter into and upon any part of
the Demised Premises upon giving reasonable prior written notice to the Lessee
to inspect the Demised Premises.
ARTICLE 18: SURRENDER OF PROPERTY
Upon the expiration or termination of this lease, the Lessee shall pay all
charges for consumption of electricity and water up to that date and at its own
expense (1) remove the Lessee's goods and effects and those of persons claiming
under the Lessee, and (ii) quit and deliver up the Demised Premises peaceably
and quietly. Any property left in the demised premises after the expiration or
termination of this lease shall be deemed to have been abandoned and shall
become the property of the Lessors to dispose of as the Lessors deems expedient.
ARTICLE 19: DEFAULT REMEDIES
(a) LESSEE'S DEFAULT
The occurrence of any one or more of the following shall constitute
a default hereunder by the Lessee:
(1) Failure to pay the rent for sixty (60) days consecutively and
if the failure continues for ten (10) days after written
notice has been received by the Lessee from the Lessors;
(2) Failure to perform any other provision of this Deed of Lease
and if such failure to perform is not cured within fifteen
(15) days after written notice has been received by the
Lessee, provided that, the Lessee shall not be in default of
this Deed of Lease if the Lessee commences to cure the default
within the fifteen (15) day period and diligently and in good
faith continues to cure the default.
Notices given under this Article shall specify the alleged default and the
applicable provision(s) hereof, and shall demand that the Lessee performs the
provisions of this Deed of Lease or pay the rent that is in arrears, as the case
may be, within the applicable period of time.
(b) LESSORS' REMEDIES
In the event of any such default by the Lessee, the Lessors may at
any time after expiration of the applicable cure period:
(1) Terminate the Lessee's right to possession of the Demised
Premises by any lawful means, in which case, this lease and
the term hereof shall terminate and the Lessors shall be
entitled to recover, by lawful means, possession of the
Demised Premises from the Lessee; OR
(2) Maintain the Lessee's right to possession in which case this
lease shall continue in effect. In such event the Lessors
shall be entitled to enforce all or any of the Lessors' rights
and remedies under this Deed of Lease; OR
(3) Pursue any other remedy now or hereafter available to the
Lessors under the laws or judicial decisions of the State
where the Demised Premises are located.
(4) In the case of the Lessee's default as contemplated herein,
the Lessors shall have a duty to mitigate its damages.
(c) LESSEE'S REMEDIES
In the event of any failure by the Lessors to perform any of its
obligations under this Deed of Lease, the Lessee (except in the case
of an emergency) shall take no action without having first given the
Lessors written notice of any such default. Following such written
notice and failure by the Lessors to cure within thirty (30) days,
the Lessee shall have all rights available to it at Law or in equity
and shall have the further right to take the necessary actions to
perform the Lessors' uncured obligations under this Deed of Lease
and invoice the Lessors for the costs and other expenses thereof,
unless the Lessors have diligently commenced to perform its uncured
obligations under this Deed of Lease within the said thirty (30) day
period. The Lessors shall remit payment to the Lessee within ten
(10) days of receipt of invoice from the Lessee. If the Lessors fail
to remit payment to the Lessee within the aforesaid ten (10) day
period, the Lessee shall have the right to offset and deduct the
said sum from the rent.
ARTICLE 20: RIGHT OF FIRST REFUSAL
The Lessee shall have the right of first refusal to take the second floor
of the property bearing Khata No.873, House list No.637, Koramangala Village,
Begur Hobli, Bangalore South Taluk, as and when constructed. The Lessors shall
not offer the second floor for lease to any third party unless the Lessee shall
have refused in writing to take the same on lease.
ARTICLE 21: GENERAL PROVISION
(a) WAIVER OF BREACH
No failure by either of the parties to perform any covenant, term or
condition or provision of this Deed of Lease or to exercise any
right or remedy consequent upon a breach of this Deed of Lease shall
constitute a waiver of any such breach or of such covenant, term or
condition or provision. No waiver of any breach shall affect or
alter this Lease, but each and every covenant, condition, term of
this lease shall continue in full force and effect with respect to
any other then existing or subsequent breach.
(b) MODIFICATION.
This Deed of Lease is not subject to modification except in a
writing that all the parties to this Deed of Lease sign.
(c) JURISDICTION
Courts in Bangalore alone shall have jurisdiction to try and dispose
of any proceedings concerning this document and the lease created
herein.
(d) NOTICE
Any notice or other communication given or made in accordance with
this Deed of Lease shall be in writing and be sent in any manner
recognized by law either at the address of that party shown on the
first page of this Deed or at any other address it may from time to
time notify to the other party as being its address for service for
the purposes of this Deed.
IN WITNESS WHEREOF, the parties hereto have set their respective hands to these
presents on the day, month and year first above written.
Signed/LTI and delivered by the said)
Lessors/Consenting parties} /s/ M. Srinivas Reddy
above named} Mr. M. Srinivas Reddy
/s/ K.C. Komala
Ms. K.C. Komala
/s/ Akkayamma
Ms. Akkayamma
/s/ Chikka Mumyamma
Ms. Chikka Mumyamma
/s/ M. Rathnamma
Ms. Rathnamma
Signed and delivered by the said) For HealthScribe India Limited:
Authorized signatory, for and on) /s/ Surya V. Ciryam
behalf of the Lessee above named) Mr. Surya V. Ciryam, Authorized Signatory
Witnesses:
/s/