Applied Optoelectronics Inc. filed SEC Form 8-K: Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation, Financial Statements and Exhibits
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Item 1.01 |
Entry into a Material Definitive Agreement. |
On October 7, 2024, Prime World International Holdings Ltd. (“Prime World”), a wholly owned subsidiary of Applied Optoelectronics, Inc., entered into a Land and Building Lease Agreement (the “Lease Agreement”) with San Ho Enterprise Co., Ltd. (the “Lessor”), under which Prime World will lease approximately 3,537 square meters of two adjoining parcels of land, designated as Land No. 0068 and No. 0069, located in the Gong 2nd Section of Linkou District, New Taipei City. The lease also includes a building on these parcels, totaling approximately 3,406 square meters, situated at Building No. 12, Gong 8th Road, Linkou District, New Taipei City (collectively, the “Leased Property”).
The lease term is for fifteen (15) years, commencing on December 1, 2024, and ending on November 30, 2039. A two-month renovation period from October 1 to November 30, 2024, will precede the lease term, during which no rent will be charged by the Lessor. During the lease term, the monthly rent will increase by three percent (3%) every three years. The monthly rent schedule, starting from December 1, 2024, through November 30, 2039, is as follows:
| Period | Monthly Rent |
| December 1, 2024 –November 30, 2027 | NTD 1,300,000 |
| December 1, 2027 –November 30, 2030 | NTD 1,339,000 |
| December 1, 2030 –November 30, 2033 | NTD 1,379,170 |
| December 1, 2033 –November 30, 2036 | NTD 1,420,545 |
| December 1, 2036 –November 30, 2039 | NTD 1,463,161 |
Under the terms of the Lease Agreement, Prime World has the right, at its own expense, to modify the building within the Leased Property as necessary to accommodate its production needs. Except as otherwise agreed by both parties in the Lease Agreement, neither party may terminate the lease early during the lease term.
Prime World holds additional rights under the Lease Agreement, including but not limited to: (i) the right of first refusal to purchase the Leased Property if the Lessor chooses to sell; (ii) the right to ensure that the Lease Agreement remains valid and binding on any purchaser in the event of a sale to a third party; and (iii) the right of first refusal to renew the lease under the same terms offered to other prospective tenants.
The foregoing description of the Lease Agreement does not purport to be a complete statement of the parties’ rights and obligations under the Lease Agreement and is qualified in its entirety by reference to the full text of the Lease Agreement, English translations of which are attached as Exhibit 10.1 to this Current Report on Form 8-K and incorporated by reference herein.
| Item 2.03 |
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information contained in Item 1.01 of this Current Report on Form 8-K with respect to the Lease Agreement is incorporated by reference into Item 2.03.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| 10.1 | Translation of the Land and Building Lease Agreement, dated October 7, 2024, between Prime World International Holdings Ltd., Taiwan Branch and San Ho Enterprise Co., Ltd. |
| 104 | Cover Page Interactive File (the cover page tags are embedded within the Inline XBRL document) |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: October 10, 2024 | APPLIED OPTOELECTRONICS, INC. | ||
| By: | /s/ David C. Kuo | ||
| Name | David C. Kuo | ||
| Title: | Chief Legal Officer | ||
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